RIGHTS AGREEMENT
BY AND BETWEEN
NORTH COUNTRY FINANCIAL CORPORATION
AND
REGISTRAR AND TRANSFER COMPANY
RIGHTS AGENT
DATED AS OF JUNE 21, 2000
TABLE OF CONTENTS
PAGE
SECTION 1. CERTAIN DEFINITIONS. 1
SECTION 2. APPOINTMENT OF RIGHTS AGENT. 4
SECTION 3. ISSUE OF RIGHT CERTIFICATES. 5
SECTION 4. FORM OF RIGHT CERTIFICATES. 6
SECTION 5. COUNTERSIGNATURE AND REGISTRATION. 6
SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND
EXCHANGE OF RIGHT CERTIFICATES; MUTILATED, DESTROYED,
LOST OR STOLEN RIGHT CERTIFICATES. 7
SECTION 7. EXERCISE OF RIGHTS; PURCHASE PRICE;
EXPIRATION DATE OF RIGHTS 7
SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHT
CERTIFICATES. 9
SECTION 9. AVAILABILITY OF PREFERRED SHARES. 9
SECTION 10. PREFERRED SHARES RECORD DATE. 10
SECTION 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER OF
SHARES OR NUMBER OF RIGHTS. 10
SECTION 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR
NUMBER OF SHARES. 17
SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER
OF ASSETS OR EARNING POWER. 18
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES. 19
SECTION 15. RIGHTS OF ACTION. 20
SECTION 16. AGREEMENT OF RIGHT HOLDERS. 21
SECTION 17. RIGHT CERTIFICATE HOLDER NOT DEEMED A
SHAREHOLDER. 21
SECTION 18. CONCERNING THE RIGHTS AGENT. 22
SECTION 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME
OF RIGHTS AGENT. 22
SECTION 20. DUTIES OF RIGHTS AGENT. 23
SECTION 21. CHANGE OF RIGHTS AGENT. 25
SECTION 22. ISSUANCE OF NEW RIGHT CERTIFICATES. 25
SECTION 23. REDEMPTION. 26
SECTION 24. EXCHANGE. 26
SECTION 25. NOTICE OF CERTAIN EVENTS. 27
SECTION 26. NOTICES. 28
SECTION 27. SUPPLEMENTS AND AMENDMENTS. 29
SECTION 28. SUCCESSORS. 29
SECTION 29. BENEFITS OF THIS AGREEMENT. 30
SECTION 30. SEVERABILITY. 30
SECTION 31. GOVERNING LAW. 30
SECTION 32. COUNTERPARTS. 30
SECTION 33. DESCRIPTIVE HEADINGS. 30
Signatures 30
Exhibit A Attachment to the Certificate of Amendment. A-1
Exhibit B Form of Right Certificate. B-1
Exhibit C Summary of Rights to Purchase Preferred Shares. C-1
RIGHTS AGREEMENT
THIS RIGHTS AGREEMENT ("Agreement"), dated as of
June 21, 2000, is made between NORTH COUNTRY FINANCIAL
CORPORATION, a Michigan corporation (the "Company"),
and REGISTRAR AND TRANSFER COMPANY, a New Jersey
corporation (the "Rights Agent").
WHEREAS, the Board of Directors of the Company
(the "Board") has authorized and declared a dividend of
one preferred share purchase right (a "Right") for each
Common Share (as hereinafter defined) of the Company
outstanding on the Record Date (as hereinafter
defined), each Right representing the right to purchase
one one-thousandth of a Preferred Share (as hereinafter
defined), upon the terms and subject to the conditions
herein set forth, and has further authorized and
directed the issuance of one Right with respect to each
Common Share that shall become outstanding between the
Record Date and the earliest of the Distribution Date,
the Redemption Date and the Final Expiration Date (as
such terms are hereinafter defined);
Accordingly, in consideration of the premises and
the mutual agreements herein set forth, the parties
hereby agree as follows:
SECTION 1. CERTAIN DEFINITIONS.
For purposes of this Agreement, the following
terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as such
term is hereinafter defined) who or which, together
with all Affiliates and Associates (as such terms are
hereinafter defined) of such Person, shall be the
Beneficial Owner (as such term is hereinafter defined)
of 10% or more of the Common Shares of the Company then
outstanding, but shall not include the Company, any
Subsidiary (as such term is hereinafter defined) of the
Company, any employee benefit plan of the Company or of
any Subsidiary of the Company or any entity holding
Common Shares for or pursuant to the terms of any such
plan. Notwithstanding the foregoing, no Person shall
become an "Acquiring Person" as the result of an
acquisition of Common Shares by the Company which, by
reducing the number of shares outstanding, increases
the proportionate number of shares beneficially owned
by such Person to 10% or more of the Common Shares of
the Company then outstanding; provided, however, that
if a Person shall become the Beneficial Owner of 10% or
more of the Common Shares of the Company then
outstanding by reason of share purchases by the Company
and shall, after such share purchases by the Company,
become the Beneficial Owner of any additional Common
Shares of the Company, then such Person shall be deemed
to be an "Acquiring Person." Notwithstanding the
foregoing, if the Board determines in good faith that a
Person who would otherwise be an "Acquiring Person," as
defined pursuant to the foregoing provisions of this
Section 1(a), has become such inadvertently, and
without any plan or intention to seek or affect control
of the Company, and such Person divests as promptly as
practicable (without exercising or retaining any power,
including voting, with respect to such shares) a
sufficient number of
Common Shares so that such Person
would no longer be an "Acquiring Person," as defined
pursuant to the foregoing provisions of this Section
1(a), then such Person shall not be deemed to be an
"Acquiring Person" for any purposes of this Agreement.
(b) "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-
2 of the General Rules and Regulations under the
Exchange Act.
(c) A Person shall be deemed the "Beneficial Owner" of
and shall be deemed to "beneficially own" any
securities:
(i) which such Person or any of such Person's
Affiliates or Associates beneficially owns, directly or
indirectly;
(ii) which such Person or any of such Person's
Affiliates or Associates has:
(A) the right to acquire (whether such right is
exercisable immediately or only after the passage of
time) pursuant to any agreement, arrangement or
understanding (other than customary agreements with and
between underwriters and selling group members with
respect to a bona fide public offering of securities),
or upon the exercise of conversion rights, exchange
rights, rights (other than these Rights), warrants or
options, or otherwise; provided, however, that a Person
shall not be deemed the Beneficial Owner of, or to
beneficially own, securities tendered pursuant to a
tender or exchange offer made by or on behalf of such
Person or any of such Person's Affiliates or Associates
until such tendered securities are accepted for
purchase or exchange; or
(B) the right to vote pursuant to any agreement,
arrangement or understanding; provided, however, that a
Person shall not be deemed the Beneficial Owner of, or
to beneficially own, any security if the agreement,
arrangement or understanding to vote such security (1)
arises solely from a revocable proxy or consent given
to such Person in response to a public proxy or consent
solicitation made pursuant to, and in accordance with,
the applicable rules and regulations promulgated under
the Exchange Act and (2) is not also then reportable on
Schedule 13D under the Exchange Act (or any comparable
or successor report); or
(iii) which are beneficially owned, directly or
indirectly, by any other Person with which such Person
or any of such Person's Affiliates or Associates has
any agreement, arrangement or understanding (other than
customary agreements with and between underwriters and
selling group members with respect to a bona fide
public offering of securities) for the purpose of
acquiring, holding, voting (except to the extent
contemplated by the proviso to Section 1(c)(ii)(B)) or
disposing of any securities of the Company.
Notwithstanding anything in this definition of
Beneficial Ownership to the contrary, the phrase "then
outstanding," when used with reference to a Person's
Beneficial Ownership of securities of the Company,
shall mean the number of such securities then issued
and outstanding together with the number of such
securities not then actually issued and outstanding
which such Person would be deemed to own beneficially
hereunder.
(d) "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking
institutions in the State of Michigan or the State of
New Jersey are authorized or obligated by law or
executive order to close.
(e) "Close of business" on any given date shall mean
5:00 P.M., Traverse City, Michigan time, on such date;
provided, however, that if such date is not a Business
Day it shall mean 5:00 P.M., Traverse City, Michigan
time, on the next succeeding Business Day.
(f) "Common Shares" when used with reference to the
Company shall mean the shares of common stock of the
Company. "Common Shares" when used with reference to
any Person other than the Company, shall mean the
capital stock (or equity interest) with the greatest
voting power of such other Person or, if such other
Person is a Subsidiary of another Person, the Person or
Persons which ultimately control such first-mentioned
Person.
(g) "Distribution Date" shall mean the earlier of (i)
the tenth day after the Shares Acquisition Date (as
such term is hereinafter defined), or (ii) the tenth
business day (or such later date as may be determined
by action of the Board prior to such time as any Person
becomes an Acquiring Person) after the date of the
commencement by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of
the Company or of any Subsidiary of the Company or any
entity holding Common Shares for or pursuant to the
terms of any such plan) of, or the first public
announcement of the intention of any Person (other than
the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or of any
Subsidiary of the Company or any entity holding Common
Shares for or pursuant to the terms of any such plan)
to commence, a tender or exchange offer the
consummation of which would result in any Person
becoming the Beneficial Owner of Common Shares
aggregating 10% or more of the then outstanding Common
Shares (including any such date which is after the date
of this Agreement and prior to the issuance of the
Rights).
(h) "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended, as in effect on the date of
this Agreement.
(i) [Reserved.]
(j) "Final Expiration Date" shall mean July 31, 2010.
(k) "NASDAQ" shall mean the National Association of
Securities Dealers, Inc. Automated Quotations System.
(l) "Person" shall mean any individual, firm,
corporation, limited liability company or other entity,
and shall include any successor (by merger or
otherwise) of such entity.
(m) "Preferred Shares" shall mean shares of Series B
Junior Participating Preferred Stock of the Company
having the rights and preferences set forth in the
attachment to the Certificate of Amendment attached to
this Agreement as Exhibit A.
(n) The "Purchase Price" for each one one-thousandth
of a Preferred Share purchasable pursuant to the
exercise of a Right shall mean $200, subject to
adjustment from time to time as provided in Sections 11
and 13 hereof.
(o) "Record Date" shall mean July 31, 2000.
(p) "Redemption Date" shall mean that date, if any, on
which the Board shall redeem the Rights as provided in
Section 23 hereof.
(q) "Redemption Price" shall mean $.01 per Right,
appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after
the date hereof.
(r) "Right Certificate" shall mean certificates
evidencing ownership of Rights in substantially the
form set out in Exhibit B hereto.
(s) "Share Exchange" shall mean an exchange pursuant
to Section 450.1702 of the Michigan Business
Corporation Act.
(t) "Shares Acquisition Date" shall mean the first
date of public announcement by the Company or an
Acquiring Person that an Acquiring Person has become
such.
(u) "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 equity
interest is owned, directly or indirectly, by such
Person.
(v) "Trading Day" shall mean a day on which the
principal national securities exchange on which a
security is listed or admitted to trading is open for
the transaction of business or, if the security is not
listed or admitted to trading on any national
securities exchange, a Business Day.
SECTION 2. APPOINTMENT OF RIGHTS AGENT.
The Company hereby appoints the Rights Agent to
act as agent for 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. The Rights Agent shall
have no duty to supervise, and in no event shall be
liable for, the acts or omissions of any such Co-Rights
Agent.
SECTION 3. ISSUE OF RIGHT CERTIFICATES.
(a) Until the Distribution Date, (x) the Rights will
be evidenced (subject to the provisions of paragraph
(b) of this Section 3 by the certificates for the
Common Shares registered in the names of the holders of
the Common Shares and not by separate certificates, and
(y) Rights will be transferable only in connection with
the transfer of the underlying Common Shares (including
a transfer to the Company).
(b) As promptly as practicable following the Record
Date, the Company will send a copy of a Summary of
Rights to Purchase Preferred Shares, in substantially
the form attached hereto as Exhibit C ("Summary of
Rights"), by first class mail, postage prepaid, to each
record holder of the Common Shares as of the close of
business on the Record Date, at the address of such
holder shown on the records of the Company. With
respect to certificates of the Common Shares
outstanding as of the Record Date, until the
Distribution Date or the earlier surrender for transfer
thereof or the Redemption Date or Final Expiration
Date, the Rights associated with the Common Shares
represented by such certificates shall be evidenced by
such certificates for the Common Shares together with a
copy of the Summary of Rights, and the registered
holders of the Common Shares shall also be the
registered holders of the associated Rights. Until the
earlier of the Distribution Date, the Redemption Date
or the Final Expiration Date, the transfer of any of
the certificates for the Common Shares outstanding on
the Record Date, with or without a copy of the Summary
of Rights attached thereto, shall also constitute the
transfer of the Rights associated with the Common
Shares represented by such certificates.
(c) Rights shall be issued in respect of all Common
Shares which become outstanding (including, without
limitation, reacquired Common Shares referred to in the
last sentence of this paragraph (c)) after the Record
Date, but prior to the earliest of the Distribution
Date, the Redemption Date or the Final Expiration Date.
Certificates representing such Common Shares shall also
be deemed to represent the related Rights. After the
Record Date, but prior to the earliest of the
Distribution Date, the Redemption Date or the Final
Expiration Date, certificates representing Common
Shares shall have impressed on, printed on, written on,
or otherwise affixed to them the following legend:
"This certificate also evidences and entitles the
holder hereof to certain rights as set forth in a
Rights Agreement between North Country Financial
Corporation and Registrar and Transfer Company,
dated as of June 21 (the "Rights Agreement"), the
terms of which are hereby incorporated herein by
reference and a copy of which is on file at the
principal executive offices of North Country
Financial Corporation. Under certain
circumstances, as set forth in the Rights
Agreement, such Rights shall be evidenced by
separate certificates and shall no longer be
evidenced by this certificate. North Country
Financial Corporation shall mail to the holder of
this certificate a copy of the Rights Agreement
without charge after receipt of a written request
therefor. Under certain circumstances, as set
forth in the Rights Agreement, Rights issued to
any Person who becomes an Acquiring Person or any
Associate or Affiliate of an Acquiring Person (as
such terms
are defined in the Rights Agreement)
(or nominee of any of them) may become null and
void."
With respect to such certificates containing the
foregoing legend, until the Distribution Date, the
Rights associated with the Common Shares
represented by such certificates shall be
evidenced by such certificates alone, and the
surrender for transfer of any such certificate
shall also constitute the transfer of the Rights
associated with the Common Shares represented
thereby. In the event that the Company purchases
or acquires any Common Shares after the Record
Date, but prior to the Distribution Date, any
Rights associated with such Common Shares shall be
deemed canceled and retired so that the Company
shall not be entitled to exercise any Rights
associated with the Common Shares which are no
longer outstanding.
(d) As soon as practicable after the Distribution
Date, the Company shall promptly notify the Rights
Agent thereof and provide the Rights Agent with a list
of shareholders of Common Shares, and the Company shall
prepare and execute, the Rights Agent shall
countersign, and the Company shall send or cause to be
sent (and the Rights Agent shall, if requested, send)
by first-class, insured, postage-prepaid mail, to each
record holder of Common Shares as of the close of
business on the Distribution Date, at the address of
such holder shown on the records of the Company, a
Right Certificate evidencing one Right for each Common
Share so held. As of the Distribution Date, the Rights
shall be evidenced solely by such Right Certificates.
SECTION 4. FORM OF RIGHT CERTIFICATES.
The Right Certificates (and the forms of election
to purchase Preferred Shares and of assignment to be
printed on the reverse thereof) shall be substantially
the same as Exhibit B hereto and may have such marks of
identification or designation and such legends,
summaries or endorsements printed thereon as the
Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, and
which do not affect the rights, duties or
responsibilities of the Rights Agent, or as may be
required to comply with any applicable law or with any
rule or regulation made pursuant thereto or with any
rule or regulation of any stock exchange on which the
Rights may from time to time be listed, or to conform
to usage. Subject to the provisions of Section 22
hereof, the Right Certificates shall entitle the
holders thereof to purchase such number of one one-
thousandths of a Preferred Share as shall be set forth
therein at the Purchase Price set forth therein, but
the number of such one one-thousandths of a Preferred
Share and the Purchase Price shall be subject to
adjustment as provided herein.
SECTION 5. COUNTERSIGNATURE AND REGISTRATION.
The Right Certificates shall be executed on behalf
of the Company by any of its Chairman of the Board, its
President, or any Vice President, and attested by any
of its by Secretary or any Assistant Secretary, either
manually or by facsimile signature. The Right
Certificates shall not be valid for any purpose unless
countersigned by the Rights Agent. In case any officer
of the Company who shall have signed any of the Right
Certificates shall cease to be such officer of the
Company before countersignature by the Rights Agent and
issuance and
delivery by the Company, such Right
Certificates, nevertheless, may be countersigned by the
Rights Agent, and issued and delivered by the Company
with the same force and effect as though the person who
signed such Right Certificates had not ceased to be
such officer of the Company; and any Right Certificate
may be signed on behalf of the Company by any person
who holds any such office at the actual date of the
execution of such Right Certificate, although at the
date of the execution of this Rights Agreement such
person was not such an officer.
Following the Distribution Date, the Rights Agent
shall keep or cause to be kept, at its offices
designated for such purpose, books for registration and
transfer of the Right Certificates issued hereunder.
Such books shall show the names and addresses of the
respective holders of the Right Certificates, the
number of Rights evidenced on its face by each of the
Right Certificates, and the date of each of the Right
Certificates.
SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE
OF RIGHT CERTIFICATES; MUTILATED, DESTROYED,
LOST OR STOLEN RIGHT CERTIFICATES.
Subject to the provisions of Section 14 hereof, at
any time after the close of business on the
Distribution Date and at or prior to the close of
business on the earlier of the Redemption Date or the
Final Expiration Date, any Right Certificate or Right
Certificates (other than Right Certificates
representing Rights that have become void pursuant to
Section 11(a)(ii) hereof or that have been exchanged
pursuant to Section 24 hereof) may be transferred,
split up, combined or exchanged for another Right
Certificate or other Right Certificates, entitling the
registered holder to purchase a like number of one one-
thousandths of a Preferred Share as the Right
Certificate or Right Certificates surrendered then
entitled such holder to purchase. Any registered
holder desiring to transfer, split up, combine or
exchange any Right Certificate or Right Certificates
shall make such request in writing delivered to the
Rights Agent, and shall surrender the Right Certificate
or Right Certificates to be transferred, split up,
combined or exchanged at the office of the Rights Agent
designated for such purpose. Thereupon the Rights
Agent shall countersign and deliver to the person
entitled thereto a Right Certificate or Right
Certificates, as the case may be, as so requested. The
Company may require payment of a sum sufficient to
cover any tax or governmental charge that may be
imposed in connection with any transfer, split up,
combination or exchange of Right Certificates. Upon
receipt by the Company and the Rights Agent of evidence
satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of
loss, theft or destruction, of indemnity or security
satisfactory to them, and, at the Company's request,
reimbursement to the Company and the Rights Agent of
all reasonable expenses incidental thereto, and upon
surrender to the Rights Agent and cancellation of the
Right Certificate if mutilated, the Company shall make
and deliver a new Right Certificate of like tenor to
the Rights Agent for delivery to the registered holder
in lieu of the Right Certificate so lost, stolen,
destroyed or mutilated.
SECTION 7. EXERCISE OF RIGHTS; PURCHASE PRICE;
EXPIRATION DATE OF RIGHTS
(a) The registered holder of any Right Certificate may
exercise the Rights evidenced thereby (except as
otherwise provided herein) in whole or in part at any
time after the
Distribution Date upon surrender of the
Right Certificate (with the form of election to
purchase on the reverse side thereof duly executed) to
the Rights Agent at the office of the Rights Agent
designated for such purpose, together with payment of
the Purchase Price for each one one-thousandth of a
Preferred Share as to which the Rights are exercised,
at or prior to the earliest of:
(i) the close of business on the Final Expiration Date,
(ii) the close of business on the Redemption Date, or
(iii) the time at which such Rights are exchanged
as provided in Section 24 hereof.
(b) The Purchase Price shall be payable in lawful
money of the United States of America in accordance
with Section 7(c).
(c) Upon receipt of a Right Certificate representing
exercisable Rights (with the form of election to
purchase duly executed), accompanied by payment (by
certified check, cashier's check, or money order
payable to the order of the Company) of the Purchase
Price for the shares to be purchased and an amount
equal to any applicable tax or governmental charge
required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof, the
Rights Agent shall thereupon promptly
(i) (A) requisition from any transfer agent of
the Preferred Shares certificates for the number of
Preferred Shares to be purchased, and the Company
hereby irrevocably authorizes its transfer agent to
comply with all such requests, or
(B) requisition from the depositary agent depositary
receipts representing such number of one one-
thousandths of a Preferred Share as are to be purchased
(in which case certificates for the Preferred Shares
represented by such receipts shall be deposited by the
transfer agent with the depositary agent) and the
Company hereby directs the depositary agent to comply
with such request; and
(ii) when necessary to comply with this Agreement,
requisition from the Company the amount of cash to be
paid in lieu of issuance of fractional shares in
accordance with Section 14 hereof; and
(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
Right Certificate, registered in such name or names as
may be designated by such holder; and
(iv) when necessary to comply with this Agreement,
after receipt, promptly deliver such cash to or upon
the order of the registered holder of such Right
Certificate.
(d) In case the registered holder of any Right
Certificate shall exercise less than all the Rights
evidenced thereby, a new Right Certificate evidencing
Rights equivalent to the Rights remaining unexercised
shall be issued by the Rights Agent to the registered
holder of such Right Certificate or to his duly
authorized assigns, subject to the provisions of
Section 6 and Section 14 hereof.
SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHT
CERTIFICATES.
All Right Certificates surrendered for the purpose
of exercise, transfer, split up, combination or
exchange shall, if surrendered to the Company or to any
of its agents, be delivered to the Rights Agent for
cancellation or in canceled form, or, if surrendered to
the Rights Agent, shall be canceled by it, and no Right
Certificates shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this
Rights Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement, and the
Rights Agent shall so cancel and retire, any other
Right Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights
Agent shall deliver all canceled Right Certificates to
the Company, or shall, at the written request of the
Company, destroy such canceled Right Certificates, and
in such case shall deliver a certificate of destruction
thereof to the Company.
SECTION 9. AVAILABILITY OF PREFERRED SHARES.
The Company covenants and agrees that it shall
cause to be reserved and kept available out of its
authorized and unissued Preferred Shares, the number of
Preferred Shares that shall be sufficient to permit the
exercise in full of all outstanding Rights in
accordance with Section 7 hereof.
The Company covenants and agrees that it shall
take all such actions as may be necessary to ensure
that all Preferred Shares delivered upon exercise of
the Rights shall, at the time of delivery of the
certificates for such Preferred Shares (subject to
payment of the Purchase Price), be duly and validly
authorized and issued and fully paid and nonassessable
shares.
The Company covenants and agrees that it shall pay
when due and payable any and all taxes and governmental
charges which may be payable in respect of the issuance
or delivery of the Right Certificates or of any
Preferred Shares upon the exercise of Rights. The
Company shall not, however, be required to pay any tax
or governmental charge which may be payable in respect
of any transfer or delivery of Right Certificates to a
person other than, or the issuance or delivery of
certificates or depositary receipts for the Preferred
Shares in a name other than that of, the registered
holder of the Right Certificate evidencing Rights
surrendered for exercise, or to issue or to deliver any
certificates or depositary receipts for Preferred
Shares upon the exercise of any Rights until any such
tax or governmental charge shall have been paid (any
such tax or governmental charge being payable by the
holder of such Right Certificate at the time of
surrender) or until it has been established to the
Company's reasonable satisfaction that no such tax or
governmental charge is due.
SECTION 10. PREFERRED SHARES RECORD DATE.
Each Person in whose name any certificate for
Preferred Shares is issued upon the exercise of Rights
shall for all purposes be deemed to have become the
holder of record of the Preferred Shares represented
thereby on, and such certificate shall be dated, the
date upon which the Right Certificate evidencing such
Rights was duly surrendered and payment of the Purchase
Price (and any applicable taxes and governmental
charges) was made; provided, however, that if the date
of such surrender and payment is a date upon which the
Preferred Shares transfer books of the Company are
closed, such person shall be deemed to have become the
record holder of such shares on, and such certificate
shall be dated, the next succeeding Business Day on
which the Preferred Shares transfer books of the
Company are open.
Prior to the issuance of Preferred Shares upon the
exercise of the Rights evidenced thereby, the holder of
a Right Certificate shall not be entitled to any rights
of a holder of Preferred Shares for which the Rights
shall be exercisable, including, without limitation,
the right to vote, to receive dividends or other
distributions, or to exercise any preemptive rights,
and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
SECTION 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER
OF SHARES OR NUMBER OF RIGHTS.
The Purchase Price, the number of Preferred Shares
covered by each Right, and the number of Rights
outstanding are subject to adjustment from time to time
as provided in this Section 11.
(a) (i) In the event the Company shall at any time
after the date of this Agreement
(A) declare a dividend on the Preferred Shares payable
in Preferred Shares,
(B) subdivide the outstanding Preferred Shares,
(C) combine the outstanding Preferred Shares into a
smaller number of Preferred Shares, or
(D) issue any shares of its capital stock in a
reclassification of the Preferred Shares (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), 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 capital stock issuable on such date,
shall be proportionately adjusted so that the holder of
any Right exercised after such time shall be entitled
to receive the aggregate number and kind of shares of
capital stock which, if such Right had been exercised
immediately prior to such date and at a time when the
Preferred Shares transfer books of the Company were
open, the holder would have owned upon such exercise
and been entitled to receive by virtue of such
dividend, subdivision, combination or reclassification;
provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right
be less than the aggregate par value of the shares of
capital stock of the Company issuable upon exercise of
one Right. If an event occurs which would require an
adjustment under both Section 11(a)(i) and Section
11(a)(ii), 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).
(ii) Subject to Section 24 of this Agreement, in
the event any Person becomes an Acquiring
Person, each holder of a Right shall
thereafter have a right to receive, upon
exercise thereof at a price equal to the then
current Purchase Price multiplied by the
number of one one-thousandths of a Preferred
Share for which a Right is then exercisable,
in accordance with the terms of this
Agreement and in lieu of Preferred Shares,
such number of Common Shares of the Company
as shall equal the result obtained by
multiplying:
(A) the then current Purchase Price by the number of
one one-thousandths of a Preferred Share for which a
Right is then exercisable and dividing that product, by
(B) 50% of the then current per share market price of
the Company's Common Shares (determined pursuant to
Section 11(d) hereof) on the date of the occurrence of
such event.
In the event that any Person shall become an
Acquiring Person and the Rights shall then be
outstanding, the Company shall not take any
action which would eliminate or diminish the
benefits intended to be afforded by the
Rights.
From and after the occurrence of such event,
any Rights that are or were acquired or
beneficially owned by any Acquiring Person
(or any Associate or Affiliate thereof, or
nominee of any of them) shall be null and
void and any holder of such Rights shall
thereafter have no right to exercise such
Rights under any provision of this Agreement.
No Right Certificate shall be issued pursuant
to Section 3 hereof or otherwise that
represents Rights beneficially owned by an
Acquiring Person whose Rights would be null
and void pursuant to the preceding sentence
(or any Associate or Affiliate thereof, or
nominee of any of them); no Right Certificate
shall be issued at any time upon the transfer
of any Rights to an Acquiring Person whose
Rights would be null and void pursuant to the
preceding sentence (or any Associate or
Affiliate thereof or any nominee of any of
them); and any Right Certificate delivered to
the Rights Agent for transfer to an Acquiring
Person whose Rights would be null and void
pursuant to the preceding sentence (or any
Associate or Affiliate thereof, or nominee of
any of them) shall be canceled. In addition,
any Right Certificate issued pursuant to
Section 3 hereof
that represents Rights
beneficially owned by an Acquiring Person (or
any Associate or Affiliate thereof, or
nominee of any of them) and any Right
Certificate issued at any time upon the
transfer of any Rights to an Acquiring Person
(or any Associate or Affiliate thereof, or
nominee of any of them) and any Right
Certificate issued pursuant to Sections 6,
7(d), 11, or 22 hereof upon transfer,
exchange, replacement or adjustment of any
other Right Certificate referred to in this
sentence, shall contain the following legend:
"The Rights represented by this Right
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 described in the
Rights Agreement) or a nominee of one of
them. This Right Certificate and the
Rights represented hereby may become
null and void in the circumstances
specified in the Rights Agreement."
(iii) In the event that there shall not be
sufficient Common Shares issued but not outstanding or
authorized but unissued to permit the exercise in full
of the Rights in accordance with the foregoing Section
11(a)(ii), the Company shall take all such actions as
may be necessary to authorize additional Common Shares
for issuance upon exercise of the Rights. In the event
the Company, after good faith effort, shall be unable
to take all such actions as may be necessary to
authorize such additional Common Shares, the Company
shall substitute, for each Common Share that would
otherwise be issuable upon exercise of a Right, a
number of Preferred Shares or fraction thereof such
that the current per share market price of one
Preferred Share multiplied by such number or fraction
is equal to the current per share market price of one
Common Share as of the date of issuance of such
Preferred Shares or fraction thereof.
(b) In case the Company shall fix a record date for
the issuance of rights, options or warrants to all
holders of Preferred Shares entitling them (for a
period expiring within 45 calendar days after such
record date) to subscribe for or purchase Preferred
Shares (or shares having the same rights, privileges
and preferences as the Preferred Shares ("Equivalent
Preferred Shares")) or securities convertible into
Preferred Shares or Equivalent Preferred Shares at a
price per share (or having a conversion price per
share, if a security convertible into Preferred Shares
or Equivalent Preferred Shares) less than the then
current per share market price of the Preferred Shares
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 Preferred Shares
outstanding on such record date plus the number of
Preferred Shares which the aggregate offering price of
the total number of Preferred Shares and/or Equivalent
Preferred Shares so to be offered (and/or the aggregate
initial conversion 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 Preferred Shares outstanding on such record date
plus the number of additional Preferred Shares and/or
Equivalent Preferred Shares to be offered for
subscription or purchase (or into which the convertible
securities so to be offered are initially
convertible); provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right
be less than the aggregate par value of the shares of
capital stock of the Company issuable upon the exercise
of one Right. 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 as determined in good faith by
the Board of Directors of the Company, whose
determination shall be described in a statement filed
with the Rights Agent and shall be binding on the
Rights Agent and holders of the Rights. Preferred
Shares 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, options or warrants are
not so issued, the Purchase Price shall be
adjusted to be the Purchase Price which would then
be in effect if such record date had not been
fixed.
(c) In case the Company shall fix a record date for
the making of a distribution to all holders of the
Preferred Shares (including any such distribution made
in connection with a consolidation or merger in which
the Company is the continuing or surviving corporation)
of evidences of indebtedness or assets (other than a
regular quarterly cash dividend or a dividend payable
in Preferred Shares) or subscription rights or warrants
(excluding those referred to in Section 11(b) hereof),
the Purchase Price to be in effect after such record
date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the then
current per share market price of the Preferred Shares
on such record date, less the fair market value (as
determined in good faith by the Board of Directors of
the Company, whose determination shall be described in
a statement filed with the Rights Agent and shall be
binding on the Rights Agent and holders of the Rights)
of the portion of the assets or evidences of
indebtedness so to be distributed or of such
subscription rights or warrants applicable to one
Preferred Share and the denominator of which shall be
such current per share market price of the Preferred
Shares; provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right
be less than the aggregate par value of the shares of
capital stock of the Company to be issued upon the
exercise of one Right.
Such adjustments shall be made successively
whenever such a record date is fixed; and in the
event that such distribution is not so made, the
Purchase Price shall again be adjusted to be the
Purchase Price which would then be in effect if
such record date had not been fixed.
(d) (i) For the purpose of any computation hereunder,
the "current per share market price" of any security (a
"Security" for the purpose of this Section 11(d)(i)) on
any date shall be deemed to be the average of the daily
closing prices per share of such Security for the 30
consecutive Trading Days immediately prior to such
date; provided, however, that in the event that the
current per share market price of the Security is
determined during a period following the announcement
by the issuer of such Security of a dividend or
distribution on such Security payable in shares
of such Security or securities convertible into such shares,
or any subdivision, combination or reclassification of
such Security, 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 per share market price
shall be appropriately adjusted to reflect the current
market price per share equivalent of such Security.
The closing price for each day shall be:
(A) the last sale price, regular way, or, in case no
such sale takes place on such day, the average of the
closing bid and asked prices, regular way, in either
case as reported in the principal consolidated
transaction reporting system with respect to securities
listed on the principal national securities exchange on
which the Security is listed or admitted to trading, or
(B) if the Security is not listed or admitted to
trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the
high bid and low asked prices in the over-the-counter
market, as reported by NASDAQ or such other system then
in use, or
(C) if the Security is 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 Security selected by the Board.
(ii) For the purpose of any computation hereunder,
the "current per share market price" of the
Preferred Shares shall be determined in
accordance with the method set forth in
Section 11(d)(i). If the Preferred Shares
are not publicly traded, the "current per
share market price" of the Preferred Shares
shall be conclusively deemed to be the
current per share market price of the Common
Shares as determined pursuant to Section
11(d)(i) (appropriately adjusted to reflect
any stock split, stock dividend or similar
transaction occurring after the Record Date),
multiplied by one thousand. If neither the
Common Shares nor the Preferred Shares are
publicly held or so listed or traded,
"current per share market price" shall mean
the fair value per share as determined in
good faith by the Board, whose determination
shall be described in a statement filed with
the Rights Agent.
(e) 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 one ten-millionth of a Preferred Share or one
ten-thousandth of any other share or security 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
requires such adjustment or (ii) the date of the
expiration of the right to exercise any Rights.
(f) If, as a result of an adjustment made pursuant to
Section 11(a) hereof, the holder of any Right
thereafter exercised shall become entitled to receive
any shares of capital stock of the Company other than
Preferred Shares, thereafter the number of such other
shares so receivable upon exercise of any Right shall
be subject to adjustment from time to time in a manner
and on terms as nearly equivalent as practicable to the
provisions with respect to the Preferred Shares
contained in Sections 11(a) through (c), inclusive, and
the provisions of Sections 7, 9, 10 and 13 hereof with
respect to the Preferred Shares shall apply on like
terms to any such other shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price
hereunder shall evidence the right to purchase, at the
adjusted Purchase Price, the number of one one-
thousandths of a Preferred Share purchasable from time
to time hereunder upon exercise of the Rights, all
subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its
election as provided in Section 11(i), upon each
adjustment of the Purchase Price as a result of the
calculations made in Sections 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-thousandths of a Preferred Share (calculated
to the nearest one ten-millionth of a Preferred Share)
obtained by:
(i) multiplying the number of one one-thousandths of a
share covered by a Right immediately prior to this
adjustment by 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 one one-thousandths of a Preferred Share
purchasable upon the exercise of a Right. Each of the
Rights outstanding after such adjustment of the number
of Rights shall be exercisable for the number of one
one-thousandths of a Preferred Share for which a Right
was exercisable immediately prior to such adjustment.
Each Right held of record prior to such adjustment of
the number of Rights shall become that number of Rights
(calculated to the nearest one ten-thousandth) obtained
by dividing the Purchase Price in effect immediately
prior to adjustment of the Purchase Price by the
Purchase Price in effect immediately after adjustment
of the Purchase Price. The Company shall make a public
announcement of its election to adjust the number of
Rights, indicating the record date for the adjustment,
and, if known at the time, the amount of the adjustment
to be made. This record date may be the date on which
the Purchase Price is adjusted or any day thereafter,
but, if the Right Certificates have been issued, shall
be at least 10 days later than the date of the public
announcement.
If Right Certificates have been issued, upon each
adjustment of the number of Rights pursuant to
this Section 11(i), the Company shall, as promptly
as practicable, cause to be distributed to holders
of record of Right Certificates on such record
date Right Certificates evidencing, subject to
Section 14 hereof, the additional Rights to which
such holders shall be entitled as a result of such
adjustment, or, at the option of the Company,
shall cause to be distributed to such holders of
record in substitution and replacement for the
Right Certificates held by such holders prior to
the date of adjustment, and upon surrender
thereof, if required by the Company, new Right
Certificates evidencing all the Rights to which
such holders shall be entitled after such
adjustment. Right Certificates so to be
distributed shall be issued, executed and
countersigned in the manner provided for herein
and shall be registered in the names of the
holders of record of Right Certificates on the
record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the
Purchase Price or the number of one one-thousandths of
a Preferred Share issuable upon the exercise of the
Rights, the Right Certificates theretofore and
thereafter issued may continue to express the Purchase
Price and the number of one one-thousandths of a
Preferred Share which were expressed in the initial
Right Certificates issued hereunder.
(k) Before taking any action that would cause an
adjustment reducing the Purchase Price below one one-
thousandth of the then par value, if any, of the
Preferred Shares issuable upon exercise of the Rights,
the Company shall take any corporate actions which may,
in the opinion of its counsel, be necessary in order
that the Company may validly and legally issue fully
paid and nonassessable Preferred Shares at such
adjusted Purchase Price.
(l) In any case in which this Section 11 shall require
that an adjustment in the Purchase Price be made
effective as of a record date for a specified event,
the Company may elect to defer (and shall promptly
notify the Rights Agent of any such election) until the
occurrence of such event the issuing to the holder of
any Right exercised after such record date of the
Preferred Shares and other capital stock or securities
of the Company, if any, issuable upon such exercise
over and above the Preferred Shares and other capital
stock or securities of the Company, if any, issuable
upon such exercise on the basis of the Purchase Price
in effect prior to such adjustment; provided, however,
that the Company shall deliver to such holder a due
xxxx or other appropriate instrument evidencing such
holder's right to receive such additional shares upon
the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make
such reductions in the Purchase Price, in addition to
those adjustments expressly required by this Section
11, as and to the extent that it in its sole discretion
shall determine to be advisable in order that any
consolidation or subdivision of the Preferred Shares,
issuance wholly for cash of any Preferred Shares at
less than the current market price, issuance wholly for
cash of Preferred Shares or securities which by their
terms are convertible into or exchangeable for
Preferred Shares, dividends on Preferred Shares payable
in Preferred Shares, or issuance of rights, options or
warrants referred to herein
above in Section 11(b), hereafter made by the Company to
holders of its Preferred Shares shall not be taxable to
such shareholders.
(n) In the event that at any time after the Record
Date and prior to the Distribution Date, the Company
shall:
(i) declare or pay any dividend on the Common Shares
payable in Common Shares, or
(ii) effect a subdivision, combination or consolidation
of the Common Shares (by reclassification or otherwise
than by payment of dividends in Common Shares) into a
greater or lesser number of Common Shares,
then in any such case,
(A) the number of one one-thousandths of a Preferred
Share purchasable after such event upon proper exercise
of each Right shall be determined by multiplying the
number of one one-thousandths of a Preferred Share so
purchasable immediately prior to such event by a
fraction, the numerator of which is the number of
Common Shares outstanding immediately before such event
and the denominator of which is the number of Common
Shares outstanding immediately after such event, and
(B) each Common Share outstanding immediately after
such event shall have issued with respect to it that
number of Rights which each Common Share outstanding
immediately prior to such event had issued with respect
to it.
The adjustments provided for in this Section 11(n)
shall be made successively whenever such a
dividend is declared or paid or such a
subdivision, combination or consolidation is
effected. If an event occurs which would require
an adjustment under Section 11(a)(ii) and this
Section 11(n), the adjustments provided for in
this Section 11(n) shall be in addition and prior
to any adjustment required pursuant to Section
11(a)(ii).
SECTION 12. CERTIFICATE OF ADJUSTED PURCHASE
PRICE OR NUMBER OF SHARES.
Whenever an adjustment is made as provided in Section
11 or 13 hereof, the Company shall promptly:
(a) prepare a certificate setting forth such
adjustment, and a brief, reasonably detailed statement
of the facts and computations accounting for such
adjustment,
(b) file with the Rights Agent and with each transfer
agent for the Common Shares or the Preferred Shares a
copy of such certificate, and
(c) mail a brief summary thereof to each holder of a
Right Certificate in accordance with Section 25 hereof.
The Rights Agent shall be fully protected in relying on
the terms of any such certificate and on any adjustment
contained therein.
SECTION 13. CONSOLIDATION, MERGER OR SALE OR
TRANSFER OF ASSETS OR EARNING POWER.
In the event, directly or indirectly, at any time after
a Person has become an Acquiring Person,
(a) the Company shall consolidate with, or merge with
and into, any other Person,
(b) 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
merger and, in connection with such merger, all or part
of the Common Shares shall be changed into or exchanged
for stock or other securities of any other Person (or
the Company) or cash or any other property,
(c) the Company shall be a party to a Share Exchange
immediately following which the Company is a Subsidiary
of any other Person, or
(d) the Company shall sell or otherwise transfer (or
one or more of its Subsidiaries shall sell or otherwise
transfer), in one or more transactions, assets or
earning power aggregating 50% or more of the assets or
earning power of the Company and its Subsidiaries
(taken as a whole) to any other Person other than the
Company or one or more of its wholly owned
Subsidiaries, then, and in each such case, proper
provision shall be made so that
(i) each holder of a Right (except as otherwise
provided herein) shall thereafter have the right to
receive, upon the exercise thereof at a price equal to
the then current Purchase Price multiplied by the
number of one-thousandths of a Preferred Share for
which a Right is then exercisable, in accordance with
the terms of this Agreement and in lieu of Preferred
Shares, such number of Common Shares of such other
Person (including the Company as successor thereto or
as the surviving corporation) as shall equal the result
obtained by multiplying the then current Purchase Price
by the number of one- thousandths of a Preferred Share
for which a Right is then exercisable and dividing that
product by 50% of the then current per share market
price of the Common Shares of such other Person
(determined pursuant to Section 11(d) hereof) on the
date of consummation of such consolidation, merger,
Share Exchange, sale or transfer;
(ii) the issuer of such Common Shares shall thereafter
be liable for, and shall assume, by virtue of such
consolidation, merger, Share Exchange, sale 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 issuer; and
(iv) such issuer shall take such steps (including, but
not limited to, the reservation of a sufficient number
of its Common Shares in accordance with Section 9
hereof) in connection with such consummation as may be
necessary to assure that the provisions hereof shall
thereafter be applicable, as nearly as reasonably may
be, in relation to the Common Shares thereafter
deliverable upon the exercise of the Rights.
The Company shall not consummate any such
consolidation, merger, Share Exchange, sale or transfer
unless prior thereto the Company and such issuer shall
have executed and delivered to the Rights Agent a
supplemental agreement so providing.
The Company shall not enter into any transaction
of the kind referred to in this Section 13 if at the
time of such transaction there are any rights,
warrants, instruments or securities outstanding or any
agreements or arrangements which, as a result of the
consummation of such transaction, would eliminate or
substantially diminish the benefits intended to be
afforded by the Rights.
The provisions of this Section 13 shall similarly
apply to successive consolidations, mergers, Share
Exchanges, sales, or other transfers.
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) The Company shall not be required to issue
fractions of Rights or to distribute Right Certificates
which evidence fractional Rights. In lieu of such
fractional Rights, there shall be paid to the
registered holders of the Right Certificates with
regard to which such fractional Rights would otherwise
be issuable, an amount in cash equal to the same
fraction of the current market value of a whole Right.
For the purposes of this Section 14(a), the current
market value of a whole Right shall be the closing
price of the Rights for the Trading Day immediately
prior to the date on which such fractional Rights would
have been otherwise issuable. The closing price for
any day shall be the last sale price, regular way, or,
in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular
way, in either case as reported in the principal
consolidated transaction reporting system with respect
to securities listed or admitted to trading on the
principal national securities exchange on which the
Rights are listed or admitted to trading or, if the
Rights are not listed or admitted to trading on any
national securities exchange, the last quoted price or,
if not so quoted, the average of the high bid and low
asked prices in the over-the-counter market, as
reported by NASDAQ or such other system then in use or,
if on any such date the Rights are not quoted by any
such organization, the average of the closing bid and
asked prices as furnished by a professional market
maker making a market in the Rights selected by the
Board. If on any such date no such market maker is
making a market in the Rights, the fair value of the
Rights on such date as determined in good faith by the
Board shall be used.
(b) The Company shall not be required to issue
fractions of Preferred Shares (other than fractions
which are integral multiples of one one-thousandth of a
Preferred Share) upon
exercise of the Rights or to
distribute certificates which evidence fractional
Preferred Shares (other than fractions which are
integral multiples of one one-thousandth of a Preferred
Share). Fractions of Preferred Shares in integral
multiples of one one-thousandth of a Preferred Share
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 Preferred
Shares represented by such depositary receipts. In
lieu of fractional Preferred Shares that are not
integral multiples of one one-thousandth of a Preferred
Share, the Company shall pay to the registered holders
of Right 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
Preferred Share. For the purposes of this Section
14(b), the current market value of a Preferred Share
shall be the closing price of a Preferred Share (as
determined pursuant to the second sentence of Section
11(d)(i) hereof) for the Trading Day immediately prior
to the date of such exercise.
(c) The holder of a Right, by the acceptance thereof,
expressly waives his right to receive any fractional
Rights or any fractional shares upon exercise of a
Right (except as provided above).
(d) The Rights Agent shall have no duty or obligation
with respect to this Section 14 or Section 24(d) unless
and until it has received specific instructions (and
sufficient cash, if required) from the Company with
respect to its duties and obligations under such
Sections.
SECTION 15. RIGHTS OF ACTION.
All rights of action in respect of this Agreement,
excepting the rights of action given to the Rights
Agent under Section 18 hereof, are vested in the
respective registered holders of the Right Certificates
(and, prior to the Distribution Date, the registered
holders of the Common Shares). Any registered holder
of any Right Certificate (or, prior to the Distribution
Date, of the Common Shares), without the consent of the
Rights Agent or of the holder of any other Right
Certificate (or, prior to the Distribution Date, of the
Common Shares), may, on his own behalf and for his own
benefit, enforce, and may institute and maintain any
suit, action or proceeding against the Company to
enforce, or otherwise act in respect of, his right to
exercise the Rights evidenced by such Right Certificate
in the manner provided in such Right Certificate and in
this Agreement. Without limiting the foregoing or any
remedies available to the holders of Rights, it is
specifically acknowledged that the holders of Rights
would not have an adequate remedy at law for any breach
of this Agreement and shall be entitled to specific
performance of the obligations under, and injunctive
relief against actual or threatened violations of the
obligations of any Person subject to this Agreement.
SECTION 16. AGREEMENT OF RIGHT HOLDERS.
Every holder of a Right, by accepting the same,
consents and agrees with the Company and the Rights
Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights shall
be transferable only in connection with the transfer of
the Common Shares;
(b) after the Distribution Date, the Right
Certificates are transferable only on the registry
books of the Rights Agent if surrendered at the office
of the Rights Agent designated for such purpose, duly
endorsed or accompanied by a proper instrument of
transfer;
(c) the Company and the Rights Agent may deem and
treat the person in whose name the Right Certificate
(or, prior to the Distribution Date, the Common Shares
certificate) is registered as the absolute owner
thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing
on the Right Certificate or the Common Shares
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) notwithstanding anything in this Agreement to the
contrary, neither the Company nor the Rights Agent
shall have any liability to any holder of a Right or
other Person as a result of its inability to perform
any of its obligations under this Agreement by reason
of any preliminary or permanent injunction or other
order, decree or ruling (whether interlocutory or
final) issued by a court of competent jurisdiction or
by a governmental, regulatory or administrative agency
or commission, or any statute, rule, regulation or
executive order promulgated or enacted by any
governmental authority, prohibiting or otherwise
restraining performance of such obligation; provided,
however, the Company must use its best efforts to have
any such order, decree or ruling lifted or otherwise
overturned as soon as possible.
SECTION 17. RIGHT CERTIFICATE HOLDER NOT DEEMED A SHAREHOLDER.
No holder, as such, of any Right Certificate shall
be entitled to vote, receive dividends or be deemed for
any purpose the holder of the Preferred Shares or any
other securities of the Company which may at any time
be issuable on the exercise of the Rights represented
thereby, nor shall anything contained herein or in any
Right Certificate be construed to confer upon the
holder of any Right Certificate, as such, any of the
rights of a shareholder of the Company or any right to
vote for the election of directors or upon any matter
submitted to shareholders at any meeting thereof, or to
give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting
shareholders (except as provided in Section 25 hereof),
or to receive dividends or subscription rights, or
otherwise, until the Right or Rights evidenced by such
Right Certificate shall have been exercised in
accordance with the provisions hereof.
SECTION 18. CONCERNING THE RIGHTS AGENT.
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 other disbursements incurred in the preparation,
delivery, administration, execution and amendment 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, damage, judgment, fine, penalty, claim,
demand, settlement, cost or expense, incurred without
negligence, bad faith or willful misconduct on the part
of the Rights Agent, for any action taken, suffered or
omitted by the Rights Agent in connection with the
acceptance and administration of this Agreement or the
exercise or performance of its duties hereunder,
including, without limitation, the costs and expenses
of defending against any claim of such liability. The
indemnity provided herein shall survive the termination
of this Agreement and the termination and the
expiration of the Rights.
The Rights Agent shall be authorized to rely on,
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 acceptance and
administration of this Agreement or the exercise or
performance of its duties hereunder in reliance upon
any Right Certificate or certificate for the Preferred
Shares or Common Shares or 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, or
otherwise upon the advice of counsel as set forth in
Section 20 hereof.
SECTION 19. MERGER OR CONSOLIDATION OR CHANGE
OF NAME OF RIGHTS AGENT.
Any Person into which the Rights Agent or any
successor Rights Agent may be merged or with which it
may be consolidated, or any Person resulting from any
merger or consolidation to which the Rights Agent or
any successor Rights Agent shall be a party, or any
Person succeeding to the stock transfer or shareholder
services 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 Person
would be eligible for appointment as a successor Rights
Agent under the provisions of Section 21 hereof. In
case, at the time such successor Rights Agent shall
succeed to the agency created by this Agreement, any of
the Right Certificates shall have been countersigned
but not delivered, any such successor Rights Agent may
adopt the countersignature of the predecessor Rights
Agent and deliver such Right Certificates so
countersigned; and in case at that time any of the
Right Certificates shall not have been countersigned,
any successor Rights Agent may countersign such Right
Certificates either in the name of the predecessor
Rights Agent or in the name of the successor Rights
Agent; and in all such cases such Right Certificates
shall have the full force provided in the Right
Certificates and in this Agreement.
In case, at any time the name of the Rights Agent
shall be changed and at such time any of the Right
Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Right
Certificates so countersigned; and in case, at that
time any of the Right Certificates shall not have been
countersigned, the Rights Agent may countersign such
Right Certificates either in its prior name or in its
changed name; and in all such cases, such Right
Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
SECTION 20. DUTIES OF RIGHTS AGENT.
The Rights Agent undertakes the duties and
obligations, and only the duties and obligations,
imposed by this Agreement (and no implied duties or
obligations) upon the following terms and conditions,
by all of which the Company and the holders of Right
Certificates, by their acceptance thereof, shall be
bound:
(a) The Rights Agent may consult with legal counsel
(who may be legal counsel for the Company), and the
advice or opinion of such counsel shall be full and
complete authorization and protection to the Rights
Agent, and the Rights Agent shall incur no liability
for or in respect of any action taken, suffered or
omitted by it in good faith and in accordance with such
advice or opinion.
(b) Whenever, in the performance of its duties under
this Agreement, the Rights Agent shall deem it
necessary or desirable that any fact or matter be
proved or established by the Company prior to taking,
suffering or omitting any action hereunder, such fact
or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be
conclusively proved and established by a certificate
signed by any one of the Chairman of the Board, the
Chief Executive Officer, the President, any Vice
President, the Treasurer or the Secretary of the
Company and delivered to the Rights Agent; and such
certificate shall be full authorization and protection
to the Rights Agent, and the Rights Agent shall incur
no liability for or in respect of any action taken,
suffered or omitted in good faith by it under the
provisions of this Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable hereunder to the
Company and any other Person only for its own
negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals
contained in this Agreement or in the Right
Certificates (except its countersignature thereof) or
be required to verify the same, but all such statements
and recitals are and shall be deemed to have been made
by the Company only.
(e) The Rights Agent shall not have any liability for,
nor shall it be under any responsibility in respect of
the validity of this Agreement or the execution and
delivery hereof (except the due execution hereof by the
Rights Agent) or in respect of the validity or
execution of any Right Certificate (except its
countersignature thereof); nor shall it be responsible for
any breach by the Company of any covenant or
condition contained in this Agreement or in any Right
Certificate; nor shall it be responsible for any change
in the exercisability of the Rights (including the
Rights becoming void pursuant to Section 11(a)(ii)
hereof) or any adjustment in the terms of the Rights
(including the manner, method or amount thereof)
provided for in Sections 3, 11, 13, 23, or 24 hereof,
or the ascertaining of the existence of facts that
would require any such change or adjustment (except
with respect to the exercise of Rights evidenced by
Right Certificates after actual notice that such change
or adjustment is required); nor shall it by any act
hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any
Preferred Shares to be issued pursuant to this
Agreement or any Right Certificate or as to whether any
Preferred Shares shall, when issued, be validly
authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it shall perform, execute,
acknowledge and deliver (or cause to be performed,
executed, acknowledged and delivered) all such further
and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the
carrying out or performing by the Rights Agent of the
provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance
of its duties hereunder from any one of the Chairman of
the Board, the Chief Executive Officer, the President,
any Vice President, the Secretary, Assistant Secretary
or the Treasurer of the Company, and to apply to such
officers for advice or instructions in connection with
its duties, and such advice or instructions shall be
full authorization and protection to the Rights Agent
and the Rights Agent shall incur no liability for or in
respect of any action taken, suffered or omitted by it
in good faith in accordance with the advice or
instructions of any such officer or for any delay in
acting while waiting for such advice or instructions.
(h) The Rights Agent and any shareholder, director,
officer, member, Affiliate 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 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
Person.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any
duty hereunder either itself or by or through its
attorneys or agents, and the Rights Agent shall not be
answerable or accountable for any act, default, neglect
or misconduct of any such attorneys or agents or for
any loss to the Company resulting from any such act,
default, neglect or misconduct, absent negligence, bad
faith or willful misconduct 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 it believes
that repayment of such funds or adequate indemnification
against such risk or liability is not assured it.
SECTION 21. CHANGE OF RIGHTS AGENT.
The Rights Agent or any successor Rights Agent may
resign and be discharged from its duties under this
Agreement upon 30 days' notice in writing mailed to the
Company and to each transfer agent of the Common Shares
or Preferred Shares by registered or certified mail,
and to the holders of the Right Certificates by first-
class mail.
The Company may remove the Rights Agent or any
successor Rights Agent upon 30 days' notice in writing,
mailed to the Rights Agent or successor Rights Agent,
as the case may be, and to each transfer agent of the
Common Shares or Preferred Shares by registered or
certified mail, and to the holders of the Right
Certificates by first-class mail.
If the Rights Agent shall resign or be removed or
shall otherwise become incapable of acting, the Company
shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a
period of 30 days after 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 Right
Certificate (who shall, with such notice, submit his
Right Certificate for inspection by the Company), then
the registered holder of any Right Certificate may
apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor
Rights Agent, whether appointed by the Company or by
such a court, shall be a Person organized and doing
business under the laws of the United States or of any
state of the United States in good standing, and
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 million.
After appointment, the successor Rights Agent
shall be vested with the same powers, rights, duties
and responsibilities as if it had been originally named
as Rights Agent, without further act or deed. 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 Shares or
Preferred Shares, and mail a notice thereof in writing
to the registered holders of the Right Certificates.
Failure to give any notice provided for in this Section
21, however, or any defect therein, shall not affect
the legality or validity of the resignation or removal
of the Rights Agent or the appointment of the successor
Rights Agent, as the case may be.
SECTION 22. ISSUANCE OF NEW RIGHT CERTIFICATES.
Notwithstanding any of the provisions of this
Agreement or of the Rights Certificates to the
contrary, the Company may, at its option, issue new
Right Certificates evidencing Rights in such form as
may be approved by the Board to reflect any adjustment
or change in the Purchase
Price and the number or kind or class of shares or
other securities or property purchasable under the
Right Certificates made in accordance with the
provisions of this Agreement.
SECTION 23. REDEMPTION.
(a) The Board may, at its option, at any time prior to
such time as any Person becomes an Acquiring Person,
redeem all but not less than all of the then
outstanding Rights at the Redemption Price; provided,
however, that in connection with a transaction to be
accounted for as a pooling of interests, the Board
shall have the option to pay the Redemption Price in
securities or other property with an equivalent value
per Right. The redemption of the Rights by the Board
may be made effective at such time on such basis and
with such conditions as the Board in its sole
discretion may establish.
(b) Immediately upon the action of the Board ordering
the redemption of the Rights pursuant to Section 23(a),
and without any further action and without any notice,
the right to exercise the Rights shall terminate and
the only right thereafter of the holders of Rights
shall be to receive the Redemption Price. The Company
shall promptly give public notice of any such
redemption; provided, however, that the failure to
give, or any defect in, any such notice shall not
affect the validity of such redemption. Within 10 days
after such action of the Board ordering the redemption
of the Rights, the Company shall mail a notice of
redemption to all the holders of the then outstanding
Rights at their last addresses as they appear upon the
registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the
transfer agent for the Common Shares. Any notice which
is mailed in the manner herein provided shall be deemed
given, whether or not the holder receives the notice.
Each such notice of redemption shall state the method
by which the payment of the Redemption Price shall be
made. Neither the Company nor any of its Affiliates or
Associates may redeem, acquire or purchase for value
any Rights at any time in any manner other than that
specifically set forth in this Section 23 or in Section
24 hereof, and other than in connection with the
purchase of Common Shares prior to the Distribution
Date.
SECTION 24. EXCHANGE.
(a) The Board may, at its option, at any time after
any Person becomes an Acquiring Person, exchange all or
part of the then outstanding and exercisable Rights
(which shall not include Rights that have become null
and void pursuant to the provisions of Section
11(a)(ii) hereof) for Common Shares at an exchange
ratio of one Common Share 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 Board shall not be empowered to effect such
exchange at any time after any Person (other than the
Company, any Subsidiary of the Company, any employee
benefit plan of the Company or any such Subsidiary, or
any entity holding Common Shares 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 Common Shares then
outstanding.
(b) Immediately upon the action of the Board ordering
the exchange of any Rights pursuant to Section 24(a),
and without any further action and without any notice,
the right to exercise such Rights shall terminate and
the only right thereafter of holders of such Rights
shall be to receive that number of Common Shares equal
to the number of such Rights held by such holder
multiplied by the Exchange Ratio. The Company shall
promptly notify the Rights Agent and 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 the Common Shares for Rights shall be effected and,
in the event of any partial exchange, the number of
Rights which shall be exchanged. Any partial exchange
shall be effected pro rata based on the number of
Rights (other than Rights which have become void
pursuant to the provisions of Section 11(a)(ii) hereof)
held by each holder of Rights.
(c) In the event that there shall not be sufficient
Common Shares issued but not outstanding or authorized
but unissued to permit any exchange of Rights as
contemplated in accordance with this Section 24, the
Company shall take all such actions as may be necessary
to authorize additional Common Shares for issuance upon
exchange of the Rights. In the event the Company
shall, after good faith effort, be unable to take all
such actions as may be necessary to authorize such
additional Common Shares, the Company shall substitute,
for each Common Share that would otherwise be issuable
upon exchange of a Right, a number of Preferred Shares
or fraction thereof such that the current per share
market price of one Preferred Share multiplied by such
number or fraction is equal to the current per share
market price of one Common Share as of the date of
issuance of such Preferred Shares or fraction thereof.
(d) The Company shall not be required to issue
fractions of Common Shares or to distribute
certificates which evidence fractional Common Shares.
In lieu of such fractional Common Shares, the Company
shall pay to the registered holders of the Right
Certificates with regard to which such fractional
Common Shares would otherwise be issuable an amount in
cash equal to the same fraction of the current market
value of a whole Common Share. For the purposes of
this Section 24(d), the current market value of a whole
Common Share shall be the closing price of a Common
Share (as determined pursuant to the second sentence of
Section 11(d)(i) hereof) for the Trading Day
immediately prior to the date of exchange pursuant to
this Section 24.
SECTION 25. NOTICE OF CERTAIN EVENTS.
(a) In case the Company shall propose
(i) to pay any dividend payable in stock of any class
to the holders of its Preferred Shares or to make any
other distribution to the holders of its Preferred
Shares (other than a regular quarterly cash dividend),
(ii) to offer to the holders of its Preferred Shares
rights or warrants to subscribe for or to purchase any
additional Preferred Shares or shares of stock of any
class or any other securities, rights or options,
(iii) to effect any reclassification of its
Preferred Shares (other than a reclassification
involving only the subdivision of outstanding Preferred
Shares),
(iv) to effect any consolidation or merger into or
with, to effect any Share Exchange 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 50% or more of the
assets or earning power of the Company and its
Subsidiaries (taken as a whole) to, any other Person,
(v) to effect the liquidation, dissolution or winding
up of the Company, or
(vi) to declare or pay any dividend on the Common
Shares payable in Common Shares or to effect a
subdivision, combination or consolidation of the Common
Shares (by reclassification or otherwise than by
payment of dividends in Common Shares), then, in each
such case, the Company shall give to the Rights Agent
and each holder of a Right 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, or distribution of
rights or warrants, or the date on which such
reclassification, consolidation, merger, Share
Exchange, sale, transfer, liquidation, dissolution, or
winding up is to take place and the date of
participation therein by the holders of the Common
Shares and/or Preferred Shares, if any such date is to
be fixed, and such notice shall be so given in the case
of any action covered by Section 25(a)(i) or (ii) above
at least 10 days prior to the record date for
determining holders of the Preferred Shares for
purposes of such action, and in the case of any such
other action, at least 10 days prior to the date of the
taking of such proposed action or the date of
participation therein by the holders of the Common
Shares and/or Preferred Shares, whichever shall be the
earlier.
(b) In case an event set forth in Section 11(a)(ii)
hereof shall occur, then the Company shall as soon as
practicable thereafter give to the Rights Agent and
each holder of a Right Certificate, in accordance with
Section 26 hereof, a notice of the occurrence of such
event, which notice shall describe such event and the
consequences of such 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 Right Certificate to or on the Company shall be
sufficiently given or made if sent by first-class mail,
postage prepaid, addressed (until another address is
filed in writing with the Rights Agent) as follows:
North Country Financial Corporation
0000 Xxxxx Xxxxxxx Xxxxx
Xxxxxxxx Xxxx, Xxxxxxxx 00000
Attention: Secretary
Subject to the provisions of Section 21 hereof,
any notice or demand authorized by this Agreement to be
given or made by the Company or by the holder of any
Right Certificate to or on the Rights Agent shall be
sufficiently given or made if sent by first-class mail,
postage prepaid, addressed (until another address is
filed in writing with the Company) as follows:
Registrar and Transfer Company
00 Xxxxxxxx Xxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Vice President/Administration
Notices or demands authorized by this Agreement to
be given or made by the Company or the Rights Agent to
the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail,
postage prepaid, addressed to such holder at the
address of such holder as shown on the registry books
of the Company.
SECTION 27. SUPPLEMENTS AND AMENDMENTS.
The Company may from time to time supplement or
amend this Agreement without the approval of any
holders of Right Certificates in order to cure any
ambiguity, to correct or supplement any provision
contained herein which may be defective or inconsistent
with any other provisions herein, or to make any other
provisions with respect to the Rights which the Company
may deem necessary or desirable, any such supplement or
amendment to be evidenced by a writing signed by the
Company and the Rights Agent; provided, however, that
from and after such time as any Person becomes an
Acquiring Person, this Agreement shall not be amended
in any manner which would adversely affect the
interests of the Rights Agent or 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 and, provided such supplement or
amendment does not change or increase the Rights
Agent's duties, liabilities or obligations hereunder,
the Rights Agent shall execute such supplement or
amendment.
SECTION 28. 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 29. BENEFITS OF THIS AGREEMENT.
Nothing in this Agreement shall be construed to
give to any person or corporation other than the
Company, the Rights Agent and the registered holders of
the Right Certificates (and, prior to the Distribution
Date, the Common Shares) any legal or equitable right,
remedy or claim under this Agreement; but this
Agreement shall be for the sole and exclusive benefit
of the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the
Distribution Date, the Common Shares).
SECTION 30. SEVERABILITY.
If any term, provision, covenant or restriction of
this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall
remain in full force and effect and shall in no way be
affected, impaired or invalidated.
SECTION 31. GOVERNING LAW.
This Agreement and each Right Certificate issued
hereunder shall be deemed to be a contract made under
the laws of the State of Michigan and for all purposes
shall be governed by and construed in accordance with
the laws thereof applicable to contracts to be made and
performed entirely within Michigan; provided, however,
that all provisions regarding the rights, duties and
obligations of the Rights Agent shall be governed by
and construed in accordance with the laws of the State
of New Jersey applicable to contracts made and to be
performed entirely within such State.
SECTION 32. COUNTERPARTS.
This Agreement may be executed in any number of
counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the
same instrument.
SECTION 33. 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.
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed as of the day and
year first above written.
NORTH COUNTRY FINANCIAL REGISTRAR AND TRANSFER
CORPORATION COMPANY
By: /s/ Xxxxxx X. Xxxx By: /s/ Xxxxxxx Tatler
--------------------- --------------------
Name: Xxxxxx X. Xxxx Name: Xxxxxxx Tatler
Title: Chairman and Chief Title: Vice President-Chief of Staff
Executive Officer
Exhibit A
ATTACHMENT TO THE
CERTIFICATE OF AMENDMENT
OF
NORTH COUNTY FINANCIAL CORPORATION
NOW, THEREFORE, BE IT RESOLVED, That pursuant to
the authority vested in the Board of Directors of this
Corporation in accordance with the provisions of its
Articles of Incorporation, a series of Preferred Stock
of the Corporation be and it hereby is created, and
that the designation and number of shares and relative
rights, preferences and limitations thereof are as
follows:
1. Designation and Amount.
The shares of such series shall be designated as
"Series B Junior Participating Preferred Stock" (the
"Series B Preferred Stock"); the number of shares
constituting such series shall be one hundred thousand
(100,000). Such number of shares may be increased or
decreased by resolution of the Board of Directors;
provided, that no decrease shall reduce the number of
shares of Series B Preferred Stock to a number less
than the number of shares then outstanding plus the
number of shares reserved for issuance upon the
exercise of outstanding options, rights or warrants or
upon the conversion of any outstanding securities
issued by the Corporation into Series B Preferred
Stock.
2. Dividends and Distributions.
(a) Subject to the rights of the holders of any
shares of any series of Preferred Stock (or any similar
stock) ranking prior and superior to the Series B
Preferred Stock with respect to dividends, the holders
of shares of Series B Preferred Stock, in preference to
the holders of Common Stock, without par value (the
"Common Stock"), of the Corporation and of any other
junior stock, shall be entitled to receive, when, as
and if declared by the Board of Directors out of funds
legally available for the purpose, quarterly dividends
payable in cash on the first day of March, June,
September and December in each year (each such date
being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly
Dividend Payment Date after the first issuance of a
share or fraction of a share of Series B Preferred
Stock, in an amount per share (rounded to the nearest
cent) equal to the greater of (i) $10 or (ii) subject
to the provision for adjustment hereinafter set forth,
1,000 times the aggregate per share amount of all cash
dividends, and 1,000 times the aggregate per share
amount (payable in kind) of all non-cash dividends or
other distributions, other than a dividend payable in
shares of Common Stock or a subdivision of the
outstanding shares of Common Stock (by reclassification
or otherwise), declared on the Common Stock since the
immediately preceding Quarterly Dividend Payment Date
or, with respect to the first Quarterly Dividend
Payment Date, since the first issuance of any share or
fraction of a share of Series B Preferred Stock. In
the event the Corporation shall at any time declare or
pay any dividend on the Common Stock payable in shares
of Common Stock, or
effect a subdivision or combination
or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment
of a dividend in shares of Common Stock) into a greater
or lesser number of shares of Common Stock, then in
each such case the amount to which holders of shares of
Series B Preferred Stock were entitled immediately
prior to such event under clause (ii) of the preceding
sentence shall be adjusted by multiplying such amount
by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after
such event and the denominator of which is the number
of shares of Common Stock that were outstanding
immediately prior to such event.
(b) The Corporation shall declare a dividend or
distribution on the Series B Preferred Stock as
provided in paragraph (a) of this Section immediately
after it declares a dividend or distribution on the
Common Stock (other than a dividend payable in shares
of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on
the Common Stock during the period between any
Quarterly Dividend Payment Date and the next subsequent
Quarterly Dividend Payment Date, a dividend of $10 per
share on the Series B Preferred Stock shall
nevertheless be payable on such subsequent Quarterly
Dividend Payment Date.
(c) Dividends shall begin to accrue and be
cumulative on outstanding shares of Series B Preferred
Stock from the Quarterly Dividend Payment Date next
preceding the date of issue of such shares, unless the
date of issue of such shares is prior to the record
date for the first Quarterly Dividend Payment Date, in
which case dividends on such shares shall begin to
accrue from the date of issue of such shares, or unless
the date of issue is a Quarterly Dividend Payment Date
or is a date after the record date for the
determination of holders of shares of Series B
Preferred Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment
Date, in either of which events such dividends shall
begin to accrue and be cumulative from such Quarterly
Dividend Payment Date. Accrued but unpaid dividends
shall not bear interest. Dividends paid on the shares
of Series B Preferred Stock in an amount less than the
total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record
date for the determination of holders of shares of
Series B Preferred Stock entitled to receive payment of
a dividend or distribution declared thereon, which
record date shall be not more than 60 days prior to the
date fixed for the payment thereof.
3. Voting Rights. The holders of shares of
Series B Preferred Stock shall have the following
voting rights:
(a) Subject to the provision for adjustment
hereinafter set forth, each share of Series B Preferred
Stock shall entitle the holder thereof to 1,000 votes
on all matters submitted to a vote of the shareholders
of the Corporation. In the event the Corporation shall
at any time declare or pay any dividend on the Common
Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of
Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the number of
votes per share to which holders of shares of Series B
Preferred Stock were entitled immediately prior to such
event shall be adjusted by multiplying such number by a
fraction, the numerator of which
is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number
of shares of Common Stock that were outstanding immediately
prior to such event.
(b) Except as otherwise provided herein, in any
certificate of amendment or such other similar document
creating a series of Preferred Stock or any similar
stock, or by law, the holders of shares of Series B
Preferred Stock and the holders of shares of Common
Stock and any other capital stock of the Corporation
having general voting rights shall vote together as one
class on all makers submitted to a vote of shareholders
of the Corporation.
(c) Except as set forth herein, or as otherwise
provided by law, holders of Series B Preferred Stock
shall have no special voting rights and their consent
shall not be required (except to the extent they are
entitled to vote with holders of Common Stock as set
forth herein) for taking any corporate action.
4. Certain Restrictions.
(a) Whenever quarterly dividends or other
dividends or distributions payable on the Series B
Preferred Stock as provided in Section 1, above, are in
arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared,
on shares of Series B Preferred Stock outstanding shall
have been paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior
(either as to dividends or upon liquidation,
dissolution or winding up) to the Series B Preferred
Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a
parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series B Preferred
Stock, except dividends paid ratably on the Series B
Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to
the total amounts to which the holders of all such
shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior
(either as to dividends or upon liquidation,
dissolution or winding up), to the Series B Preferred
Stock, provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any
such junior stock in exchange for shares of any stock
of the Corporation ranking junior (either as to
dividends or upon dissolution, liquidation or winding
up) to the Series B Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series B Preferred Stock,
or any shares of stock ranking on a parity with the
Series B Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of
such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend
rates and other relative rights
and preferences of the respective series and classes, shall
determine in good faith will result in fair and equitable
treatment among the respective series or classes.
(b) The Corporation shall not permit any
subsidiary of the Corporation to purchase or otherwise
acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under
paragraph (a) of this Section 3, purchase or otherwise
acquire such shares at such time and in such manner.
5. Reacquired Shares. Any shares of Series B
Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired
and canceled promptly after the acquisition thereof.
All such shares shall upon their cancellation become
authorized but unissued shares of Preferred Stock and
may be reissued as part of a new series of Preferred
Stock subject to the conditions and restrictions on
issuance set forth herein, in the Articles of
Incorporation, or in any certificate of amendment or
such other similar document creating a series of
Preferred Stock or any similar stock or as otherwise
required by law.
6. Liquidation, Dissolution or Winding Up. Upon
any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (a) to the
holders of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding
up) to the Series B Preferred Stock unless, prior
thereto, the holders of shares of Series B Preferred
Stock shall have received $1,000 per share, plus an
amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the
date of such payment, provided that the holders of
shares of Series B Preferred Stock shall be entitled to
receive an aggregate amount per share, subject to the
provision for adjustment hereinafter set forth, equal
to 1,000 times the aggregate amount to be distributed
per share to holders of shares of Common Stock, or (b)
to the holders of shares of stock ranking on a parity
(either as to dividends or upon liquidation,
dissolution or winding up) with the Series B Preferred
Stock, except distributions made ratably on the Series
B Preferred Stock and all such parity stock in
proportion to the total amounts to which the holders of
all such shares are entitled upon such liquidation,
dissolution or winding up. In the event the Corporation
shall at any time declare or pay any dividend on the
Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each
such case the aggregate amount to which holders of
shares of Series B Preferred Stock were entitled
immediately prior to such event under the proviso in
clause (b) of the preceding sentence shall be adjusted
by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock
outstanding immediately after such event and the
denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such
event.
7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of
Common Stock are exchanged for or changed into other
stock or securities, cash and/or any other property,
then in any such case each share of Series B Preferred
Stock shall at the same time be similarly exchanged or
changed into an amount per share, subject to the
provision for adjustment hereinafter set forth,
equal to 1,000 times the aggregate amount of stock,
securities, cash and/or any other property (payable in
kind), as the case may be, into which or for which each
share of Common Stock is changed or exchanged. In the
event the Corporation shall at any time declare or pay
any dividend on the Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock
(by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each
such case the amount set forth in the preceding
sentence with respect to the exchange or change of
shares of Series B Preferred Stock shall be adjusted by
multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock
outstanding immediately after such event and the
denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such
event.
8. No Redemption. The shares of Series B
Preferred Stock shall not be redeemable.
9. Rank. The Series B Preferred Stock shall
rank, with respect to the payment of dividends and the
distribution of assets, junior to all series of any
other class of the Corporation's Preferred Stock.
Exhibit B
Form of Right Certificate - Front Side
Certificate No. R-_______________ _______________ Rights
NOT EXERCISABLE AFTER _________________ ____,
2010, OR EARLIER REDEMPTION OR EXCHANGE. THE RIGHTS
ARE SUBJECT TO REDEMPTION AT $.01 PER RIGHT AND TO
EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, RIGHTS
BENEFICIALLY OWNED BY ACQUIRING PERSONS, ASSOCIATES OR
AFFILIATES OF ACQUIRING PERSONS (AS SUCH TERMS ARE
DEFINED IN THE RIGHTS AGREEMENT) (OR NOMINEE OF ANY OF
THEM) OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY
BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS
RIGHT 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 DESCRIBED IN THE
RIGHTS AGREEMENT) OR A NOMINEE OF ONE OF THEM. THIS
RIGHT CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY
BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN
THE RIGHTS AGREEMENT.]1
Right Certificate
NORTH COUNTRY FINANCIAL CORPORATION
This certifies that _______________________, or
registered assigns, is the registered owner of the
number of Rights set forth above, each of which
entitles the owner thereof, subject to the terms,
provisions and conditions of the Rights Agreement,
dated as of June 21, 2000 (the "Rights Agreement"),
between North Country Financial Corporation, a Michigan
corporation (the "Company"), and Registrar and Transfer
Company (the "Rights Agent"), to purchase from the
Company at any time after the Distribution Date (as
such term is defined in the Rights Agreement) and prior
to 5:00 P.M., Traverse City, Michigan time, on July 31,
2010, at the office of the Rights Agent designated for
such purpose, or at the office of its successor as
Rights Agent, one one-thousandth of a fully paid non-
assessable share of Series B Junior Participating
Preferred Stock (the "Preferred Shares"), of the
Company, at a purchase price of $200.00 per one one-
thousandth of a Preferred Share (the "Purchase Price"),
upon presentation and surrender of this Right
Certificate with the Form of Election to Purchase duly
executed.
The number of Rights evidenced by this Right
Certificate (and the number of one one-thousandths of a
Preferred Share which may be purchased upon exercise
hereof) and the Purchase Price set forth above are the
number and Purchase Price as of _________________,
200__, based on the Preferred Shares as constituted at
such date. As provided in the Rights Agreement, the
Purchase Price and the number of one one-thousandths of
a Preferred Share
-----------------------
1 The portion of the legend in brackets shall be inserted only if applicable.
which may be purchased upon the exercise of the Rights evidenced
by this Right Certificate are subject to modification and adjustment
upon the happening of certain events.
This Right Certificate is subject to all of the
terms, provisions and conditions of the Rights
Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part
hereof and reference is hereby made to the Rights
Agreement for a full description of the rights,
limitations of rights, obligations, duties and
immunities of the Rights Agent, the Company, and the
holders of the Right Certificates. Copies of the
Rights Agreement are on file at the principal executive
offices of the Company and the above-mentioned offices
of the Rights Agent.
This Right Certificate, upon surrender at the
office of the Rights Agent designated for such purpose,
may be exchanged for another Right Certificate of like
tenor and date evidencing Rights entitling the holder
to purchase a like aggregate number of Preferred Shares
as the Rights evidenced by the Right Certificate. If
this Right Certificate shall be exercised in part, the
holder shall be entitled to receive upon surrender
hereof another Right Certificate or Right Certificates
for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement,
the Rights evidenced by this Certificate (i) may be
redeemed by the Company at a redemption price of $.01
per Right or (ii) may be exchanged in whole or in part
for shares of the Company's Common Stock, par value
$.01 per share, or Preferred Shares.
No fractional Preferred Shares shall be issued
upon the exercise of any Right or Rights evidenced
hereby (other than fractions which are integral
multiples of one one-thousandth of a Preferred Share,
which may, at the election of the Company, be evidenced
by depositary receipts), but in lieu thereof a cash
payment shall be made, as provided in the Rights
Agreement.
No holder of this Right Certificate shall be
entitled to vote or receive dividends or be deemed for
any purpose the holder of the Preferred Shares or of
any other securities of the Company which may at any
time be issuable on the exercise hereof, nor shall
anything contained in the Rights Agreement or herein be
construed to confer upon the holder hereof, as such,
any of the rights of a stockholder of the Company or
any right to vote for the election of directors or upon
any matter submitted to stockholders at any meeting
thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or
other actions affecting stockholders (except as
provided in the Rights Agreement), or to receive
dividends or subscription rights, or otherwise, until
the Right or Rights evidenced by this Right Certificate
shall have been exercised as provided in the Rights
Agreement.
This Right Certificate shall not be valid or
obligatory for any purpose until it has been
countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper
officers of the Company, dated as of ______________________ ____, ______.
ATTEST: NORTH COUNTRY
FINANCIAL CORPORATION
By: ________________________ By: ________________________
Secretary
Countersigned (for purposes of authentication):
REGISTRAR AND TRANSFER COMPANY
By: __________________________
Authorized Signature
Form of Right Certificate - Reverse Side
NOTICE
The signature in the Form of Assignment or Form of
Election to Purchase, as the case may be, must conform
to the name as written upon the face of this Right
Certificate in every particular, without alteration or
enlargement or any change whatsoever.
In the event the certification set forth below in
the Form of Assignment or the Form of Election to
Purchase, as the case may be, is not completed, the
Company and the Rights Agent will deem the beneficial
owner of the Rights evidenced by this Right Certificate
to be an Acquiring Person or an Affiliate or Associate
thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.
FORM OF ASSIGNMENT
(To be executed by the registered holder to transfer the Right Certificate.)
FOR VALUE RECEIVED, __________________, hereby
sells, assigns and transfers unto _____________________
________________________________________________________
(Please print name and address of transferee)
this Right Certificate, together with all right, title
and interest therein, and does hereby irrevocably
constitute and appoint ______________________________
______________ Attorney, to transfer the within Right
Certificate on the books of the within-named Company, with
full power of substitution.
Signature: ___________________________ Dated: ___________________
Signature Guaranteed:
(Signatures must be guaranteed by a member firm of
a registered national securities exchange, a member of
the National Association of Securities Dealers, Inc.,
or a commercial bank or trust company having an office
or correspondent in the United States.)
The undersigned hereby certifies that the Rights
evidenced by this Right Certificate are not
beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the
Rights Agreement).
Signature: _________________________________
FORM OF ELECTION TO PURCHASE
(To be executed by registered holder to exercise Rights
represented by the Right Certificate.)
To: NORTH COUNTRY FINANCIAL CORPORATION
The undersigned hereby irrevocably elects to
exercise ________ Rights represented by this Right
Certificate to purchase the Preferred Shares issuable
upon the exercise of such Rights and requests that
certificates for such Preferred Shares be issued in the
name of: _____________________________________________
_____________________________________________________
(Please print name and address)
Social security or taxpayer identification number: _________________
If such number of Rights shall not be all the
Rights evidenced by this Right Certificate, a new Right
Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:
____________________________________________________________
____________________________________________________________
(Please print name and address)
Social security or taxpayer identification number:
Signature: _____________________________ Dated: _____________________
Signature Guaranteed:
(Signatures must be guaranteed by a member firm of
a registered national securities exchange, a member of
the National Association of Securities Dealers, Inc.,
or a commercial bank or trust company having an office
or correspondent in the United States.)
The undersigned hereby certifies that the Rights
evidenced by this Right Certificate are not
beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the
Rights Agreement).
Signature: ___________________________
Exhibit C
Summary of Rights to Purchase Preferred Shares
The board of directors of North Country Financial
Corporation (the "Company") has adopted a shareholders
rights plan pursuant to which one right to purchase one
one-thousandth of a share of the Company's newly
created Series B junior participating preferred stock
was issued as a dividend for each outstanding share of
common stock. In addition, all newly-issued shares of
common stock will have one right issued with and
attached to each share of common stock. Each Right,
when exercisable, represents the right to purchase one
one-thousandth of a share of Series B junior
participating preferred stock for $200.00. The rights
will become exercisable ten days after a person or
group acquires 10% or more of the Company's outstanding
common stock, or commences or announces a tender or
exchange offer which would result in such ownership.
If, after the rights become exercisable, the
Company were to be acquired through a merger or other
business combination transaction or 50% or more of the
Company's assets or earning power were sold, each right
would permit the holder to purchase, for the exercise
price, common stock of the acquiring company having a
market value of twice the exercise price. In addition,
if any person acquires 10% or more of the Company's
outstanding common stock, each right not owned by such
person would permit the purchase, for the exercise
price of $200.00, of common stock of the Company having
a market value of twice the exercise price.
The rights expire on July 31, 2010, unless earlier
redeemed by the Company in accordance with the terms of
the rights plan. The purchase price payable and the
shares of Series B junior participating preferred stock
issuable upon exercise of the rights is subject to
adjustment from time to time as specified in the rights
plan. In addition, the board of directors retains the
authority to redeem (at $0.01 per right) and replace
the rights with new rights at any time, provided that
no such redemption could occur after a person or group
acquires 10% or more of the Company's outstanding
common stock.
Shares of Series B junior participating preferred
stock, when issued upon exercise of the rights, will be
nonredeemable and will rank junior to all series of any
other class of the Company's preferred stock. Each
share of Series B junior participating preferred stock
will be entitled to a cumulative preferential quarterly
dividend payment equal to the greater of $10 per share
or 1,000 times the dividend declared per share of the
Company's common stock. In the event of liquidation,
the holders of shares of Series B junior participating
preferred stock will be entitled to a preferential
liquidation payment equal to the greater of $1,000 per
share or 1,000 times the payment made per share of the
Company's common stock. Finally, in the event of any
merger, consolidation or other transaction in which
common stock is exchanged, each share of Series B
junior participating preferred stock will be entitled
to receive 1,000 times the amount received per share of
common stock. The foregoing rights are subject to
antidilution adjustments.
A copy of the rights agreement which specifies the
terms of the rights has been filed with the Securities
and Exchange Commission as an exhibit to a registration
statement on Form 8-A with respect to the rights. A
copy of the rights agreement is also available free of
charge from
the Company upon request. This summary is
not complete and is qualified in its entirety by
reference to the rights agreement.
