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Exhibit 4.1
XX-XXX STORES, INC.
AND
NATIONAL CITY BANK, NATIONAL ASSOCIATION, AS RIGHTS AGENT
AMENDED AND RESTATED
RIGHTS AGREEMENT
DATED AS OF
OCTOBER 31, 2000
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AMENDED AND RESTATED
RIGHTS AGREEMENT
This AMENDED AND RESTATED RIGHTS AGREEMENT (this "Agreement"),
dated as of October 31, 2000, is made and entered into by and between Xx-Xxx
Stores, Inc., an Ohio corporation (the "Company"), and National City Bank,
National Association, as Rights Agent (the "Rights Agent").
One right (a "Right") has been distributed with respect to
each Class A Common Share (as hereinafter defined) outstanding on October 31,
2000, and the Board of Directors of the Company has authorized the issuance of
one Right in respect of (1) each Class A Common Share issued after October 31,
2000, and the earlier of the Shares Acquisition Date or the Expiration Date (as
such terms are hereinafter defined), (2) each Class B Common Share (as
hereinafter defined) outstanding on December 29, 2000, and (3) each Class B
Common Share issued between December 29, 2000, and the earlier of the Shares
Acquisition Date or the Expiration Date, including in each case Common Shares
that are treasury shares and subsequently become outstanding. Each Right
represents the right to purchase one Class A Common Share.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereby agree as follows:
Section 1. CERTAIN DEFINITIONS. For purposes of this Agreement, the
following terms have the meanings indicated:
(a) "Acquiring Person" means any Person (as such term is hereinafter
defined) that, together with all Affiliates and Associates (as such terms are
hereinafter defined) of the Person, is the Beneficial Owner (as such term is
hereinafter defined) of a number of Class A Common Shares that equals or exceeds
15% of the number of Class A Common Shares then outstanding, but will not
include the Company, any subsidiary of the Company, any employee benefit plan or
employee stock ownership plan of the Company or of any subsidiary of the Company
or any person organized, appointed or established by the Company or any
subsidiary of the Company for or pursuant to the terms of any such plan.
Notwithstanding the foregoing, no Person will become an "Acquiring
Person" as the result of an acquisition of Class A Common Shares by the Company
that, by reducing the number of shares outstanding, increases the proportionate
number of shares beneficially owned by the Person to 15% or more of the Class A
Common Shares then outstanding; except that, if a Person becomes the Beneficial
Owner of 15% or more of the Class A Common Shares then outstanding by reason of
share purchases by the Company and, after such share purchases by the Company,
becomes the Beneficial Owner of any additional Class A Common Shares, then the
Person will be deemed to be an "Acquiring Person". In addition, if the Board of
Directors of the Company determines in good faith that a Person that would
otherwise be an "Acquiring Person" has become the Beneficial Owner of 15% or
more of the Class A Common Shares inadvertently, and the Person divests as
promptly as practicable a sufficient number of Class A Common Shares so that the
Person would no longer be an "Acquiring Person", then the Person will not be
deemed to be an "Acquiring Person" for any purposes of this Agreement.
(b) "Affiliate" and "Associate" have the meanings given to them in Rule
12b-2 of the General Rules and Regulations under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), as in effect on the date hereof.
(c) "Associated Acquiring Person" means (i) any Associate or Affiliate
of an Acquiring Person, (ii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee after the Acquiring Person
becomes such or (iii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives Rights pursuant to either (A) a
transfer (whether or not for consideration) from the Acquiring Person to any
Person who holds an equity interest in such Acquiring Person or with whom the
Acquiring Person has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer that the Board of Directors
of the
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Company has determined is part of a plan, arrangement or understanding that has,
as a primary purpose or effect, the avoidance of Section 7(e).
(d) A Person will be deemed to be the "Beneficial Owner of and will be
deemed to "beneficially own" any securities:
(i) that the Person, or any of the Person's Affiliates or
Associates, beneficially owns, directly or indirectly;
(ii) that the Person or any of the Person's Affiliates or
Associates, directly or indirectly, has the right to acquire (whether
such right is exercisable immediately or only after the passage of
time) pursuant to any agreement, arrangement or understanding (whether
or not in writing), or upon the exercise of conversion rights, exchange
rights, rights, warrants or options, or otherwise; except that, a
Person will not be deemed to be the "Beneficial Owner" of or to
"beneficially own" (1) securities tendered pursuant to a tender offer
made by the Person or any of the Person's Affiliates or Associates
until such tendered securities are accepted for purchase, or (2)
securities issuable upon exercise of these Rights;
(iii) that the Person or any of the Person's Affiliates or
Associates, directly or indirectly, has the right to vote or dispose
of, pursuant to any agreement, arrangement or understanding (whether or
not in writing); except that, a Person will not be deemed to be the
Beneficial Owner of or to "beneficially own" any security under this
subparagraph (iii) if the agreement, arrangement or understanding to
vote such security (A) arises solely from a revocable proxy given in
response to a public proxy or consent solicitation made pursuant to,
and in accordance with, the applicable rules and regulations under the
Exchange Act and (B) is not then reportable by the Person on Schedule
13D under the Exchange Act (or any comparable or successor report); or
(iv) that are beneficially owned, directly or indirectly, by
any other Person with which the Person or any of the Person's
Affiliates or Associates has any agreement, arrangement or
understanding (whether or not in writing) for the purpose of acquiring,
holding, voting (except pursuant to a revocable proxy as described in
subparagraph (iii) of this paragraph (c)) or disposing of any
securities of the Company.
Notwithstanding the foregoing, (x) a Person will not be deemed
to be the Beneficial Owner of, or to "beneficially own," any security if
beneficial ownership arises solely as a result of the Person's status as a
"clearing agency," as defined in Section 3(a)(23) of the Exchange Act, (y) a
Person engaged in business as an underwriter of securities will not be deemed to
be the Beneficial Owner of, or to "beneficially own," any securities acquired
through the Person's participation in good faith in an underwriting syndicate
pursuant to an agreement to which the Company is a party until expiration of 40
calendar days after the date on which the securities are acquired, and (z) for
purposes of determining the amount of Class A Common Shares beneficially owned
by any of the Family Members, (A) the Class A Common Shares beneficially owned
by any one or more of the Family Members will not be deemed to be beneficially
owned by any other Family member, whether individually or as part of a group,
and (B) the Class A Common Shares beneficially owned by any one or more of the
Family Members that, after the date of this Agreement, are transferred (whether
the transfer is voluntarily or by operation of law and whether the transfer is
of a direct or indirect interest in the shares) to any other Family Member will
not be deemed to be beneficially owned by the other Family Member.
(e) "Business Day" means any day other than a Saturday, Sunday
or a day on which banking institutions in the State of Ohio are authorized or
obligated by law or executive order to close.
(f) "Class A Common Shares" means the Class A Common Shares,
without par value, of the Company.
(g) "Class B Common Shares" means the Class B Common Shares,
without par value, of the Company.
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(h) "Close of business" on any given date means 5:00 P.M.,
Cleveland time, on such date; except that, if such date is not a Business Day,
it will mean 5:00 P.M., Cleveland time, on the next succeeding Business Day.
(i) "Common Shares" means the Class A Common Shares and the
Class B Common Shares.
(j) "Current market price" is defined in Section 11(d).
(k) "Exchange Act" is defined in Section 10.
(l) "Exercise Price" means the exercise price per share set
forth in Section 11.
(m) "Expiration Date" is defined in Section 7(a).
(n) "Family Members" mean Xxxxxx Xxxxxxxx, Xxxxx Xxxxxxxx,
Xxxxxx Xxxxxxxxx, Xxxx Xxxxxxxxx, Xxxxx Xxxxx, Xxxxxxx Xxxxx, their descendants,
their spouses, and the spouses of their descendants, the executors,
administrators, and custodians of any of the foregoing, and any trust for the
benefit of any of the foregoing.
(o) "Issuance" includes the issuance of authorized but
unissued shares and the transfer of treasury shares. In the event the Class A
Common Shares or Class B Common Shares are subdivided into a greater number of
shares, the excess of the number of shares into which the Class A Common Shares
or the Class B Common Shares are subdivided over the number of shares prior to
the subdivision will be deemed to be "issued."
(p) "NASDAQ" is defined in Section 11(d).
(q) "Person" means any individual, firm, corporation or other
entity.
(r) "Purchase Price" means the purchase price per share set
forth in Section 7(b).
(s) "Redemption Price" is defined in Section 22(a).
(t) "SEC" means the Securities and Exchange Commission.
(u) "Securities Act" is defined in Section 9(c).
(v) "Shares Acquisition Date" means the first date of public
announcement by the Company or an Acquiring Person (by press release, filing
made with the SEC or otherwise) that an Acquiring Person has become such.
(w) "Subsidiary" means any corporation or other entity of
which a majority of the voting power of the voting equity securities or other
equity interests is owned, directly or indirectly, by the Company.
(x) "Triggering Event" is defined in Section 11(a)(ii).
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. Any actions that may be taken by the Rights
Agent pursuant to the terms of this Agreement may be taken by any such Co-Rights
Agent.
Section 3. ISSUE OF RIGHT CERTIFICATES.
(a) Until the Shares Acquisition Date, (i) the Rights will be
evidenced (subject to the provisions of Section 3(b)) by the certificates for
the Common Shares registered in the names of the holders of the Common
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Shares (which certificates for the Common Shares will also be deemed to be Right
Certificates) and not by separate Right Certificates, and (ii) the right to
receive Right Certificates will be transferable only in connection with the
transfer of the Common Shares. As soon as practicable after receipt of written
notice from the Company that the Shares Acquisition Date has occurred, the
Rights Agent will send, by first-class, insured, postage prepaid mail, at the
expense of the Company, to each record holder of the Common Shares as of the
close of business on the Shares Acquisition Date, at the address of such holder
shown on the records of the Company, a Right Certificate, in substantially the
form of Exhibit A hereto, evidencing one Right for each Common Share held of
record as of the close of business on the Shares Acquisition Date. As of the
close of business on the Shares Acquisition Date, the Rights will be evidenced
solely by such Right Certificates.
(b) Rights will be issued in respect of all Common Shares
issued (including but not limited to Common Shares that are treasury shares and
subsequently become outstanding) or surrendered for transfer or exchange after
October 31, 2000, in the case of Class A Common Shares, or after December 29,
2000, in the case of Class B Common Shares, but prior to the earlier of the
Shares Acquisition Date or the Expiration Date. Certificates representing such
Common Shares will 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 an Amended and Restated Rights Agreement
between Xx-Xxx Stores, Inc., and ____________________, as Rights Agent,
dated as of October 31, 2000, as such Amended and Restated Rights
Agreement may be amended from time to time thereafter, a copy of which
is on file at the principal executive offices of Xx-Xxx Stores, Inc.
Under certain circumstances, as set forth in the Amended and Restated
Rights Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this certificate.
Xx-Xxx Stores, Inc., will mail to the holder of this certificate a copy
of the Amended and Restated Rights Agreement (as in effect on the date
of mailing) without charge promptly after receipt of a written request
therefor. Under certain circumstances, Rights that are or were
beneficially owned by Acquiring Persons or their Affiliates or
Associates (as such terms are defined in the Amended and Restated
Rights Agreement) and any subsequent holder of such Rights may become
null and void.
Until the Shares Acquisition Date, the Rights associated with
the Common Shares represented by such certificates will be evidenced by such
certificates alone, and the surrender for transfer of any of such certificates
will also constitute the surrender for transfer of the Rights associated with
the Common Shares represented by such certificate.
Section 4. FORM OF RIGHT CERTIFICATES.
(a) The Right Certificates (and the forms of election to
purchase shares and of assignment to be printed on the reverse thereof) will be
substantially the same as Exhibit A hereto and may have such marks of
identification or designation and such legends, summaries or endorsements
printed thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
applicable law, 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 of any association on which the Rights may from time to time
be authorized for quotation, or to conform to usage. Subject to the provisions
of Section 21, the Right Certificates, whenever issued, will entitle the holders
thereof to purchase such number of Class A Common Shares (or, following a
Triggering Event, Class A Common Shares, other securities, cash or other assets,
as the case may be) as will be set forth therein at the Purchase Price (or, upon
the occurrence of a Triggering Event, at the Exercise Price), but the number of
such shares, the Purchase Price and the Exercise Price will be subject to
adjustment as provided herein.
(b) Notwithstanding any other provision of this Agreement, any
Right Certificate issued pursuant to Section 3 or Section 21 that represents
Rights beneficially owned by an Acquiring Person or an Associated Acquiring
Person, any Right Certificate issued at any time to any nominee of an Acquiring
Person or an Associated Acquiring Person, and any Right Certificate issued
pursuant to Section 6 or Section 11 upon transfer, exchange, replacement or
adjustment of any Right Certificate referred to in this sentence, will contain
the following legend:
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The Rights represented by this Right Certificate are or were
beneficially owned by a Person who was or became an Acquiring Person or
an Associated Acquiring Person (as such terms are defined in the Rights
Agreement between Xx-Xxx Stores, Inc., and ____________________, as
Rights Agent, dated as of October 31, 2000). Accordingly, this Right
Certificate and the Rights represented hereby may become null and void
in the circumstances specified in Section 7(e) of the Rights Agreement.
Section 5. COUNTERSIGNATURE AND REGISTRATION. The Right
Certificates will be executed on behalf of the Company by its Chairman of the
Board, President or any Vice President, either manually or by facsimile
signature, and will be attested by the Secretary or an Assistant Secretary of
the Company, either manually or by facsimile signature. The Right Certificates
will be countersigned manually or by facsimile by the Rights Agent and will not
be valid for any purpose unless so countersigned. In case any officer of the
Company who has signed any of the Right Certificates ceases to hold such office
of the Company before countersignature by the Rights Agent and issuance and
delivery by the Company, such Right Certificates may nevertheless be
countersigned by the Rights Agent, issued and delivered with the same force and
effect as though the person who signed such Right Certificates had not ceased to
hold such office of the Company; and any Right Certificate may be signed on
behalf of the Company by any person who, at the actual date of the execution of
such Right Certificate, is a proper officer of the Company to sign such Right
Certificate, although at the date of the execution of this Rights Agreement any
the Person did not hold such office.
Following the Shares Acquisition Date, the Rights Agent will
keep or cause to be kept, at one of its offices in Cleveland, Ohio, books for
registration and transfer of the Right Certificates. Such books will 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.
(a) Subject to the provisions of Section 4(b), Section 7(e)
and Section 13, at any time after the close of business on the Shares
Acquisition Date, and at or prior to the close of business on the Expiration
Date, any Right Certificate or Certificates may be transferred, split up,
combined or exchanged for another Right Certificate or Right Certificates,
entitling the registered holder to purchase a like number of Class A Common
Shares (or, following a Triggering Event, a like number or amount of Class A
Common Shares, other securities, cash or other assets, as the case may be) as
the Right Certificate or Right Certificates surrendered then entitled such
holder (or former holder in the case of a transfer) to purchase. Any registered
holder desiring to transfer, split up, combine or exchange any Right Certificate
or Right Certificates will make such request in writing delivered to the Rights
Agent, and will surrender the Right Certificate or Right Certificates to be
transferred, split up, combined or exchanged at the principal office of the
Rights Agent in Cleveland, Ohio for such purpose. Neither the Rights Agent nor
the Company will be obligated to take any action with respect to the transfer of
any such surrendered Right Certificate until the registered holder has completed
and signed the certificate contained in the form of assignment on the reverse
side of such Right Certificate and has provided such additional evidence of the
identity of the Beneficial Owner or former Beneficial Owner, or Affiliates or
Associates thereof, as the Company may reasonably request. Thereupon the Rights
Agent will, subject to Section 4(b), Section 7(e) and Section 13, countersign
and deliver to the person entitled thereto a Right Certificate or Right
Certificates, as the case may be, as so requested. The Company may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer, split up, combination or exchange of
Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of the loss, theft or
destruction of a Right Certificate, of indemnity or security reasonably
satisfactory to them and reimbursement to the Company and the Rights Agent of
all reasonable expenses incidental thereto, and, in case of the mutilation of a
Right Certificate, upon surrender to the Rights Agent and cancellation of the
mutilated Right Certificate, the Company will make and deliver a new Right
Certificate of like tenor to the Rights Agent for delivery to the registered
owner in lieu of the Right Certificate so lost, stolen, destroyed or mutilated.
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Section 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE
OF RIGHTS; NULL AND VOID RIGHTS.(a) Subject to Section 7(e), 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
Shares Acquisition 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 its principal office in Cleveland, Ohio, together with payment of the
aggregate Purchase Price with respect to the total number of Class A Common
Shares (or the aggregate Exercise Price with respect to the total number of
Class A Common Shares or other securities, cash or other assets, as the case may
be) as to which such surrendered Rights are then exercised, at or prior to the
close of business on October 31, 2010 (the "Expiration Date").
(b) Each Right will, as of the date of this Amended and
Restated Rights Agreement, represent the right to purchase one Class A Common
Share, subject to adjustment as provided in Section 11. The Purchase Price for
each Class A Common Share pursuant to the exercise of a Right will, as of the
date of this Amended and Restated Rights Agreement, be $60.00, subject to
further adjustment from time to time as provided in Section 11, and will 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 and the certificate
duly executed, accompanied by payment of the Purchase Price for the Class A
Common Shares (or the Exercise Price for the Class A Common Shares, other
securities, cash or assets, as the case may be) to be purchased and an amount
equal to any applicable transfer tax in cash, or by certified check or bank
draft payable to the order of the Company, the Rights Agent will, subject to
Section 19(k), promptly (i) requisition from any transfer agent of the Class A
Common Shares certificates for the total number of Class A Common Shares to be
purchased, and the Company hereby irrevocably authorizes its transfer agent to
comply with all such requisitions, (ii) if the Company has elected to deposit
the total number of Class A Common Shares issuable upon exercise of the Rights
with a depositary agent, requisition from the depositary agent depositary
receipts representing such number of Class A Common Shares as are to be
purchased (in which case certificates for the Class A Common Shares represented
by such receipts will be deposited by the transfer agent with the depositary
agent), and the Company will direct the depositary agent to comply with all such
requisitions, (iii) when applicable, requisition from the Company the amount of
cash to be paid in lieu of issuance of fractional shares in accordance with
Section 13, (iv) 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 (v) when applicable, after receipt promptly
deliver such cash to or upon the order of the registered holder of such Right
Certificate. In the event that the Company is obligated to issue securities, pay
cash or distribute assets pursuant to Section 11(a)(ii) or Section 13, the
Company will make all arrangements necessary so that such securities, cash, and
assets are available for issuance, payment, or distribution by the Rights
Agent, as and when appropriate.
(d) In case the registered holder of any Right Certificate
exercises less than all the Rights evidenced thereby, a new Right Certificate
evidencing Rights equivalent to the Rights remaining unexercised will 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 13.
(e) Notwithstanding anything in this Agreement to the
contrary, any Rights that are or were at any time beneficially owned by an
Acquiring Person or an Associated Acquiring Person, will become null and void
upon the occurrence of a Triggering Event and no holder of such Rights will have
any right with respect to such Rights under any provision of this Agreement from
and after the occurrence of the Triggering Event. The Company will use all
reasonable efforts to insure that the provisions of this Section 7(e) and
Section 4(b) are complied with, but will have no liability to any holder of
Right Certificates or other Person as a result of its failure properly to make
any determinations with respect to an Acquiring Person, an Associated Acquiring
Person or their transferees or nominees hereunder.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company will be obligated to
undertake any action with respect to a registered holder upon the occurrence of
any purported exercise as set forth in this Section 7 unless such registered
holder has (i) completed and signed the certificate contained in the form of
election to purchase set forth on the reverse side of the Right Certificate
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surrendered for such exercise and (ii) provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates or
Associates thereof as the Company may reasonably request.
Section 8. CANCELLATION AND DESTRUCTION OF RIGHT CERTIFICATES.
All Right Certificates surrendered for the purpose of exercise, transfer, split
up, combination or exchange will, if surrendered to the Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in cancelled form
or, if surrendered to the Rights Agent, will be cancelled by it, and no Right
Certificates will be issued in lieu thereof except as expressly permitted by the
provisions of this Agreement. The Company will deliver to the Rights Agent for
cancellation and retirement, and the Rights Agent will cancel and retire, any
Right Certificate purchased or acquired by the Company otherwise than upon the
exercise thereof. The Rights Agent will deliver all cancelled Right Certificates
to the Company or will, at the written request of the Company, destroy such
cancelled Right Certificates and, in such case, will deliver a certificate of
destruction thereof to the Company.
Section 9. RESERVATION AND AVAILABILITY OF CLASS A COMMON
SHARES.
(a) The Company will cause to be reserved and kept available
out of its authorized and unissued Class A Common Shares or any authorized and
issued Class A Common Shares held in its treasury, the number of Class A Common
Shares that will be sufficient to permit the exercise in full of all outstanding
Rights.
(b) The Company will, as soon as practicable following a
Triggering Event, cause all Class A Common Shares (or other securities, as the
case may be) reserved for issuance upon exercise of the Rights to be, upon
official notice of issuance, listed on the stock exchange or market on which the
Class A Common Shares are then listed for trading.
(c) The Company will, as soon as practicable following the
first occurrence of a Triggering Event, (i) prepare and file a registration
statement under the Securities Act of 1933 (the "Securities Act") with respect
to the Rights and the securities purchasable upon exercise of the Rights on an
appropriate form, (ii) use its reasonable best efforts to cause such
registration statement to become effective as soon as practicable after such
filing, and (iii) use its reasonable best efforts to cause such registration
statement to remain effective (with a prospectus at all times meeting the
requirements of the Securities Act) until the date of the expiration of the
Rights. The Company will also take such actions as may be appropriate under the
blue sky laws of the various states in connection with the issuance of the
Rights and the securities purchasable upon exercise of the Rights. The Company
may temporarily suspend, for a period of time not to exceed ninety (90) days,
the exercisability of the Rights in order to prepare and file such registration
statement. Upon any such suspension, the Company will issue a public
announcement and notice to the Rights Agent stating that the exercisability of
the Rights has been temporarily suspended, and the Company will issue a public
announcement and notice to the Rights Agent at such time as the suspension is no
longer in effect. Notwithstanding any provision of this Agreement to the
contrary, the Rights will not be exercisable in any jurisdiction in which any
requisite registration or qualification will not have been obtained.
(d) The Company will take all such action as may be necessary
to ensure that all Class A Common Shares (or other securities, as the case may
be) delivered upon exercise of Rights will, at the time of delivery of the
certificates therefor (subject to payment of the Purchase Price or the Exercise
Price, as the case may be), be duly and validly authorized and issued, fully
paid and nonassessable, freely tradeable, free and clear of any liens,
encumbrances or other adverse claims and not subject to any call or first
refusal right.
(e) The Company will pay when due and payable all federal and
state transfer taxes and charges that may be payable in respect of the issuance
or delivery of the Right Certificates or of any Class A Common Shares (or other
securities, as the case may be) upon the exercise of Rights. The Company will
not, however, be required to (a) pay any transfer tax that may be payable in
respect of any transfer involved in the transfer or delivery of Right
Certificates or the issuance or delivery of certificates for the Class A Common
Shares (or other securities, as the case may be) in a name other than that of
the registered holder of the Right Certificate evidencing the Rights surrendered
for exercise or (b) issue or deliver any certificates for a number of Class A
Common Shares (or other securities, as the case may be) upon the exercise of any
Rights until any such tax has been paid (any such tax being payable by the
holder of such Right Certificate at the time of surrender) or until it has been
established to the Company's satisfaction that no such tax is due.
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Section 10. CLASS A COMMON SHARE CERTIFICATE DATE. Each person
in whose name any certificate for Class A Common Shares (or other securities, as
the case may be) is issued upon the exercise of Rights will for all purposes be
deemed to have become the holder of record of such Class A Common Shares (or
other securities, as the case may be) represented thereby on, and such
certificate will be dated, the date upon which the Right Certificate evidencing
such Rights was duly surrendered and payment of the Purchase Price (or the
Exercise Price, as the case may be) and any applicable transfer taxes was made;
except that, if the date of such surrender and payment is a date upon which the
Class A Common Share (or other security, as the case may be) transfer books of
the Company are closed, the Person will be deemed to have become the record
holder thereof on, and such certificate will be dated, the next succeeding
Business Day on which the Class A Common Shares (or other securities, as the
case may be) transfer books of the Company are open. Prior to the exercise of
the Rights evidenced thereby, the holder of a Right Certificate will not be
entitled to any rights of a shareholder of the Company with respect to shares
for which the Rights are exercisable, including, without limitation, the right
to vote, to receive dividends or other distributions or to exercise any
preemptive rights, and will not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
Section 11. ADJUSTMENT OF PURCHASE PRICE, EXERCISE PRICE,
NUMBER AND TYPE OF SHARES OR NUMBER OF RIGHTS. The Purchase Price and the
Exercise Price, the number of Class A Common 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 at any time after the date of
this Agreement (A) declares a dividend on the Class A Common Shares
payable in Class A Common Shares, (B) subdivides the outstanding Class
A Common Shares, (C) combines the outstanding Class A Common Shares
into a smaller number of shares, or (D) issues any shares of its
capital stock in a reclassification of the Class A Common 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) and
Section 7(e), the Purchase Price and the Exercise 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 Class A Common Shares or shares of capital stock, as the
case may be, issuable on such date, will be proportionately adjusted so
that the holder of any Right exercised after such time will be entitled
to receive the aggregate number and kind of Class A Common Shares or
shares of capital stock, as the case may be, which, if such Right had
been exercised immediately prior to such date and at a time when the
Class A Common Share transfer books of the Company were open, such
holder would have owned upon such exercise and been entitled to receive
by virtue of such dividend, subdivision, combination or
reclassification. If an event occurs that would require an adjustment
under both this Section 11(a) and Section 11(a), the adjustment
provided for in this Section 11(a) will be in addition to, and will be
made prior to any adjustment required pursuant to Section 11(a).
(ii) In the event any Person becomes an Acquiring Person (a
"Triggering Event"), each holder of a Right (except as provided in
Section 7(e)) will thereafter have the right to receive, upon exercise
of the Right in accordance with the terms of this Agreement, one Class
A Common Share for an Exercise Price of $.50 per share; the number of
such Class A Common Shares and the Exercise Price will be subject to
adjustment as provided in this Section 11.
(iii) In the event that there are not enough Class A Common
Shares authorized but unissued or held as treasury shares to permit the
exercise in full of the Rights in accordance with paragraph (ii) above,
the Company will take all such actions as may be necessary to authorize
a sufficient number of additional Class A Common Shares to permit the
exercise in full of the Rights and will refrain from paying dividends
or making any other distributions on the Class A Common Shares or the
Class B Common Shares until such additional Class A Common Shares have
been authorized and made available to the holders of the Rights for
issuance upon exercise of their Rights.
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(b) In case the Company fixes a record date for the issuance
of rights or warrants to all holders of Class A Common Shares entitling them
(for a period expiring within 45 calendar days after such record date) to
subscribe for or purchase Class A Common Shares at a price per Class A Common
Share (or having a conversion price per share, if a security convertible into
Class A Common Shares) less than the current market price (as defined in Section
11(d)) per Class A Common Share on such record date, the Purchase Price and the
Exercise Price to be in effect after such record date will be determined by
multiplying the Purchase Price and the Exercise Price in effect immediately
prior to such record date by a fraction, of which the numerator is the number of
Class A Common Shares outstanding on such record date plus the number of Class A
Common Shares which the aggregate offering price of the total number of Class A
Common 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 of which the denominator is the number of Class A Common Shares
outstanding on such record date plus the number of additional Class A Common
Shares to be offered for subscription or purchase (or into which the convertible
securities so to be offered are initially convertible). In case such
subscription price is paid in a consideration part or all of which is in a form
other than cash, the value of such consideration will be as determined in good
faith by the Board of Directors of the Company, whose determination will be
described in a statement filed with the Rights Agent. Class A Common Shares
owned by or held for the account of the Company will not be deemed outstanding
for the purpose of any such computation. Such adjustment will be made
successively whenever such a record date is fixed; and in the event that such
rights or warrants are not so issued, the Purchase Price and the Exercise Price
will be adjusted to be the Purchase Price and the Exercise Price that would then
be in effect if such record date had not been fixed.
(c) In case the Company fixes a record date for the making of
a distribution to all holders of Class A Common 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 periodic cash dividend or a dividend payable in
Class A Common Shares, but including any dividend payable in stock other than
Class A Common Shares) or subscription rights or warrants (excluding those
referred to in Section 11(b)), the Purchase Price and the Exercise Price to be
in effect after such record date will be determined by multiplying the Purchase
Price or the Exercise Price, as the case may be, in effect immediately prior to
such record date by a fraction, of which the numerator is the current market
price (as defined in Section 11(d)) per Class A Common Share on such record
date, less the fair market value (as determined in good faith by the Board of
Directors of the Company, whose determination will be described in a statement
filed with the Rights Agent) of the portion of the assets or evidences of
indebtedness so to be distributed or of such subscription rights or warrants
applicable to one Class A Common Share and of which the denominator is the
current market price of one Class A Common Share. Such adjustments will be made
successively whenever such a record date is fixed; and in the event that such
distribution is not so made, the Purchase Price and the Exercise Price will be
adjusted to be the Purchase Price and the Exercise Price that would then be in
effect if such record date had not been fixed.
(d) For the purpose of any computation hereunder, the "current
market price" or "value" per share of the Class A Common Shares on any date of
determination will be the average of the daily closing prices per share of such
Class A Common Shares for the 30 consecutive Trading Days (as such term is
hereinafter defined) immediately prior to such date; except that, in the event
that the "current market price" or "value" per share of the Class A Common
Shares is determined during the period following the announcement by the issuer
of such Class A Common Shares of (A) a dividend or distribution on such Class A
Common Shares payable in such Class A Common Shares or securities convertible
into such Class A Common Shares or (B) any subdivision, combination or
reclassification of such Class A Common Shares and prior to the expiration of 30
Trading Days after the ex-dividend date for such dividend or distribution or the
record date for such subdivision, combination or reclassification, then, and in
each such case, the "current market price" or "value" will be appropriately
adjusted to take into account ex-dividend trading. The closing price for each
day will be the last sale price, regular way, or, in case no such sale takes
place on such day, the average of the closing bid and asked prices, regular way,
in either case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the New York
Stock Exchange (the "NYSE") or, if the Class A Common Shares are not listed or
admitted to trading on the NYSE, as reported in the NASDAQ Stock Market
("NASDAQ") or, if the Class A Common Shares are not listed or admitted to
trading on the NYSE or NASDAQ, as reported in the principal consolidated
transaction reporting system on which the Class A Common Shares are listed or
admitted to trading or, if the Class A Common Shares are not listed or admitted
to trading on the NYSE or NASDAQ or reported by any consolidated transaction
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reporting system, the average of the high bid and low asked prices in the
over-the-counter market as reported by the National Association of Securities
Dealers, Inc. or such other organization then reporting transactions in the
over-the-counter market or, if on any such date the Class A Common Shares are
not listed or admitted to trading on the NYSE or NASDAQ or reported by any
consolidated transaction reporting system or other organization, the average of
the closing bid and asked prices as furnished by a professional market maker
making a market in the Class A Common Shares selected by the Board of Directors
of the Company. The term "Trading Day" will mean a day on which the principal
national securities exchange or market on which Class A Common Shares are listed
or admitted to trading is open for the transaction of business or, if the Class
A Common Shares are not listed or admitted to trading on any national securities
exchange or market, a Monday, Tuesday, Wednesday, Thursday or Friday on which
banking institutions in the State of Ohio are not authorized or obligated by law
or executive order to close. If the Class A Common Shares are not publicly held
or not so listed or traded, "current market price" or "value" per share will
mean the value per share as determined in good faith by an independent
investment banking firm selected by the Board of Directors, whose determination
will be described in a statement filed with the Rights Agent and will be
conclusive for all purposes.
(e) No adjustment in the Purchase Price or the Exercise Price
will be required unless such adjustment would require an increase or decrease of
at least 1% in such price; provided, however, that any adjustments that by
reason of this Section 11(e) are not required to be made will be carried forward
and taken into account in any subsequent adjustment. All calculations under this
Section 11 will be made to the nearest cent or to the nearest ten-thousandth of
a Class A Common Share, as the case may be. Notwithstanding the first sentence
of this Section 11(e), any adjustment required by this Section 11 will be made
no later than the earlier of (i) three years from the date of the transaction
that mandates 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), the holder of any Right exercised after such adjustment becomes entitled
to receive upon exercise of such Right any shares of capital stock of the
Company other than Class A Common Shares, thereafter the number of, and the
Purchase Price and the Exercise Price for, such other shares will 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 Class A Common Shares
contained in Section 11(a) through (m)) inclusive, and the provisions of Section
7, Section 9, Section 10 and Section 13 with respect to the Class A Common
Shares will 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 or the Exercise Price hereunder will
evidence the right to purchase, at the adjusted Purchase Price or the adjusted
Exercise Price, as the case may be, the number of Class A Common Shares (or
other securities, as the case may be) purchasable from time to time hereunder
upon exercise of the Rights, all subject to further adjustment as provided
herein.
(h) Unless the Company has exercised its election as provided
in Section 11(i), upon each adjustment of the Purchase Price or the Exercise
Price as a result of the calculations made in Section 11(b) and Section 11(c),
each Right outstanding immediately prior to the making of such adjustment will
thereafter evidence the right to purchase, at the adjusted Purchase Price or the
adjusted Exercise Price, as the case may be, that number of Class A Common
Shares (calculated to the nearest ten-thousandth) obtained by (i) multiplying
(x) the number of Class A Common Shares covered by a Right immediately prior to
this adjustment by (y) the Purchase Price or the Exercise Price, as the case may
be, in effect immediately prior to such adjustment and (ii) dividing the product
so obtained by the Purchase Price or the Exercise Price, as the case may be, in
effect immediately after such adjustment.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price or the Exercise Price to adjust the number of
Rights, in substitution for any adjustment in the number of Class A Common
Shares purchasable upon the exercise of a Right. Each of the Rights outstanding
after such adjustment of the number of Rights will be exercisable for the number
of Class A Common Shares 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 will become that number of Rights (calculated to the nearest
ten-thousandth), obtained by dividing the Purchase Price or the Exercise Price,
as the case may be, in effect immediately prior to such adjustment by the
Purchase Price
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or the Exercise Price, as the case may be, in effect immediately after such
adjustment. The Company will make a public announcement of its election to
adjust the number of Rights, indicating the record date for the adjustment to be
made. This record date may be the date on which the Purchase Price or the
Exercise Price, as the case may be, is adjusted or any day thereafter but, if
Right Certificates have been issued, will 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 will, as promptly as practicable, cause to be distributed to holders of
Right Certificates on such record date Right Certificates evidencing, subject to
Section 13, the additional Rights to which such holders will be entitled as a
result of such adjustment or, at the option of the Company, will 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 will be entitled after such
adjustment. Right Certificates so to be distributed will be issued, executed and
countersigned in the manner provided for herein (and may bear, at the option of
the Company, the adjusted Purchase Price or the adjusted Exercise Price) and
will be registered in the names of the holders of record of Right Certificates
on the record date specified in the public announcement.
(j) Notwithstanding any adjustment or change in the Purchase
Price, the Exercise Price or the number of Class A Common Shares issuable upon
the exercise of the Rights, the Right Certificates theretofore and thereafter
issued may continue to express the Purchase Price, the Exercise Price and the
number of Class A Common Shares that were expressed in the initial Right
Certificates.
(k) Before taking any action that would cause an adjustment
reducing the Purchase Price or the Exercise Price below the stated capital, if
any, of a Class A Common Share issuable upon exercise of the Rights, the Company
will take any corporate action that may be necessary in order that the Company
may validly and legally issue fully paid and nonassessable Class A Common Shares
at such adjusted Purchase Price and or at such adjusted Exercise Price, as the
case may be.
(l) In any case in which this Section 11(i) requires that an
adjustment in the Purchase Price or the Exercise Price be made effective as of a
record date for a specified event, the Company may elect to defer until the
occurrence of such event the issuing to the holder of any Right exercised after
such record date the number of Class A Common Shares issuable upon such exercise
over and above the number of Class A Common Shares issuable upon such exercise
on the basis of the Purchase Price or the Exercise Price in effect prior to such
adjustment; provided, however, that the Company will deliver to such holder a
due xxxx or other appropriate instrument evidencing such holder's right to
receive such additional Class A Common Shares upon the occurrence of the event
requiring such adjustment.
(m) Anything in this Section 11(i) to the contrary
notwithstanding, the Company will be entitled to make such reduction in the
Purchase Price or the Exercise Price, in addition to those adjustments expressly
required by this Section 11(i), as and to the extent that it in its sole
discretion determines to be advisable in order that any consolidation or
subdivision of Class A Common Shares, issuance wholly for cash of any Class A
Common Shares at less than the current market price, issuance wholly for cash of
securities that by their terms are convertible into or exchangeable for Class A
Common Shares, stock dividends or issuance of rights, options or warrants
referred to in this Section 11(i), hereafter made by the Company to holders of
its Class A Common Shares will not be taxable to such holders.
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Section 12. CERTIFICATES OF ADJUSTED PURCHASE PRICE, EXERCISE
PRICE OR NUMBER OF SHARES. Whenever an adjustment is made as provided in Section
11(i), the Company will (a) promptly prepare a certificate setting forth such
adjustment, and a brief statement of the facts accounting for such adjustment,
(b) promptly file with the Rights Agent and with each transfer agent for the
Common Shares a copy of such certificate, and (c) mail a brief summary thereof
to each holder of a Right Certificate (or, if prior to the Shares Acquisition
Date, to each holder of a certificate representing Common Shares) in accordance
with Section 24. The Rights Agent will be fully protected in relying on any such
certificate and on any adjustment therein contained, will not be obligated or
responsible for calculating any adjustment and will not be deemed to have
knowledge of such adjustment unless and until it has received such certificate.
Section 13. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) The Company will not be required to issue fractions of
Rights or to distribute Right Certificates that evidence fractional Rights. In
lieu of such fractional Rights, the Company will pay 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 13(a),
the current market value of a whole Right will 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 each
day will be the last sale price, regular way, or, in case no such sale takes
place on such day, the average of the closing bid and asked prices, regular way,
in either case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the New York
Stock Exchange (the "NYSE") or, if the Rights are not listed or admitted to
trading on the NYSE, as reported in NASDAQ or, if the Rights are not listed or
admitted to trading on the NYSE or NASDAQ, as reported in the principal
consolidated transaction reporting system on which the Rights are listed or
admitted to trading or, if the Rights are not listed or admitted to trading on
the NYSE or NASDAQ or reported by any consolidated transaction reporting system,
the average of the high bid and low asked prices in the over-the-counter market
as reported by the National Association of Securities Dealers, Inc. or such
other organization then reporting transactions in the over-the-counter market
or, if on any such date the Rights are not listed or admitted to trading on the
NYSE or NASDAQ or reported by any consolidated transaction reporting system or
other organization, the average of the closing bid and asked prices as furnished
by a professional market maker making a market in the Rights selected by the
Board of Directors of the Company.
(b) The Company will not be required to issue fractions of
Class A Common Shares upon exercise of the Rights or to distribute certificates
that evidence fractional shares. In lieu of fractional Class A Common Shares,
the Company may pay to the registered holders of Right Certificates at the time
such Right Certificates are exercised as herein provided an amount in cash equal
to the same fraction of the current market value of one Class A Common Share.
For purposes of this Section 13(b), the current market value of one Class A
Common Share will be the closing price of a Class A Common Share (as determined
pursuant to Section 11(d)) for the Trading Day immediately prior to the date of
such exercise.
(c) The holder of a Right by the acceptance of the Right
expressly waives his right to receive any fractional Rights or any fractional
shares upon exercise of a Right.
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Section 14. RIGHTS OF ACTION. All rights of action in respect
of this Agreement are vested in the respective registered holders of the Right
Certificates (and, prior to the Shares Acquisition Date, the registered holders
of the Common Shares); and any registered holder of any Right Certificate (or,
prior to the Shares Acquisition Date, of any Common Share), without the consent
of the Rights Agent or of the holder of any other Right Certificate (or, prior
to the Shares Acquisition Date, of the Common Shares), may, in the holder's own
behalf and for the holder's own benefit, enforce, and may institute and maintain
any suit, action or proceeding against the Company to enforce, or otherwise act
in respect of, the holder's right to exercise the Rights evidenced by such Right
Certificate. Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the holders of Rights
would not have an adequate remedy at law for any breach of this Agreement and
will be entitled to specific performance of the obligations under, and
injunctive relief against actual or threatened violations of, the obligations of
any Person subject to this Agreement.
Section 15. AGREEMENT OF RIGHT HOLDERS. Every holder of a
Right by accepting such Right consents and agrees with the Company and the
Rights Agent and with every other holder of a Right that:
(a) prior to the Shares Acquisition Date, the Rights will be
transferable only in connection with the transfer of the Common Shares;
(b) after the Shares Acquisition Date, the Right Certificates
are transferable only on the registry books of the Rights Agent if surrendered
at the principal office of the Rights Agent in Cleveland, Ohio, duly endorsed or
accompanied by a proper instrument of transfer and with the appropriate forms
and certificates fully executed; and
(c) subject to Section 6, Section 7(e) and Section 7(f), the
Company and the Rights Agent may deem and treat the Person in whose name the
Right Certificate (or, prior to the Shares Acquisition Date, the associated
Common Share certificate) is registered as the absolute owner thereof and of the
Rights evidenced thereby (notwithstanding any notations of ownership or writing
on the Right Certificates or the associated Common Share certificate made by
anyone other than the Company or the Rights Agent) for all purposes, and neither
the Company nor the Rights Agent will be affected by any notice to the contrary.
Section 16. RIGHT CERTIFICATE HOLDER NOT DEEMED A SHAREHOLDER.
No holder, as such, of a Right Certificate will be entitled to vote, receive
dividends or be deemed for any purpose to be the holder of the number of Class A
Common Shares that may at any time be issuable on the exercise of the Rights
represented thereby, nor will anything contained herein or in any Right
Certificate give to any holder, as such, of a Right Certificate 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
23), or to receive dividends or subscription rights, or otherwise, until the
Right or Rights evidenced by such Right Certificate have been exercised in
accordance with the provisions of this Agreement.
Section 17. CONCERNING THE RIGHTS AGENT.
(a) The Company will 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, to reimburse it for or pay its reasonable expenses
and counsel fees and other disbursements incurred in the administration and
execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent for, and to
hold it harmless against, any loss, liability or expense incurred without gross
negligence, bad faith or willful misconduct on the part of the Rights Agent as a
result of anything done or omitted to be done by the Rights Agent in connection
with the acceptance and administration of this Agreement, including without
limitation the costs and expenses of defending against any claim of liability in
connection therewith. The costs and expenses of enforcing this right of
indemnification will also be paid by the Company. The indemnification provided
for hereunder will survive the expiration of the Rights and the termination of
this Agreement.
(b) The Rights Agent may conclusively rely upon and will be
protected and will incur no liability for or in respect of any action taken,
suffered or omitted by it in connection with its administration of this
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Agreement in reliance upon any Right Certificate or certificate for Common
Shares or other securities, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement or other document believed by it in good faith to be
genuine and to be signed, executed and, where necessary, verified or
acknowledged by the proper person or persons.
(c) Notwithstanding anything in this Agreement to the
contrary, in no event will the Rights Agent be liable for special, indirect or
consequential loss or damage of any kind (including but not limited to lost
profits), even if the Rights Agent has been advised of the likelihood of such
loss or damage and regardless of the form of the action.
Section 18. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF
RIGHTS AGENT.
(a) Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be consolidated, or
any corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent will be a party, or any corporation,
succeeding to the shareholder services business of the Rights Agent or any
successor Rights Agent, will be the successor to the Rights Agent under this
Agreement without the execution or filing of any document or any further act on
the part of any of the parties hereto, provided that such corporation is for
appointment as a successor Rights Agent under the provisions of Section 20. In
case at the time such successor Rights Agent succeeds to the agency created by
this Agreement any of the Right Certificates has been countersigned but not
delivered, any such successor Rights Agent may adopt the countersignature of the
predecessor so countersigned; in case at that time any of the Right Certificates
have not 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 will have the full force provided in the Right Certificates and in
this Agreement.
(b) In case at any time the name of the Rights Agent is
changed and at such time any of the Right Certificates has been countersigned
but not delivered, the Rights Agent may adopt the countersignature under its
prior name and deliver Right Certificates so countersigned; in case at that time
any of the Right Certificates have not 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 will have the full force
provided in the Right Certificates and in this Agreement.
Section 19. DUTIES OF RIGHTS AGENT. The Rights Agent
undertakes the duties and obligations imposed by this Agreement upon the
following terms and conditions, and no implied duties or obligations will be
read into this Agreement against the Rights Agent, by all of which the Company
and the holders of Right Certificates, by their acceptance thereof, will be
bound:
(a) Before the Rights Agent acts or refrains from acting, the
Rights Agent may consult with legal counsel (who may be legal counsel for the
Company), and the opinion of such counsel will be full and complete
authorization and protection to the Rights Agent as to any action taken or
omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent deems it necessary or desirable that any fact or
matter be proved or established by the Company prior to taking or suffering any
action hereunder, such fact or matter (unless other evidence in respect thereof
is specifically prescribed in this Agreement) may be deemed to be conclusively
proved and established by a certificate signed by any one of the Chairman of the
Board, the President, any Vice President, the Treasurer or the Secretary of the
Company and delivered to the Rights Agent; and such certificate will be full
authorization to the Rights Agent for any action taken or omitted in good faith
by it under the provisions of this Agreement in reliance upon such certificate.
(c) The Rights Agent will be liable hereunder only for its own
gross negligence, bad faith or willful misconduct.
(d) The Rights Agent will 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
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such statements or recitals, but all such statements and recitals are and will
be deemed to have been made by the Company only.
(e) The Rights Agent will not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the
validity or execution of any Right Certificate (except its countersignature
thereof and as provided in Section 17); nor will it be responsible for any
breach by the Company of any covenant or condition contained in this Agreement
or in any Right Certificate; nor will it be responsible for any adjustment
required under the provisions of Section 11 or the manner, method or amount of
any such adjustment or the ascertaining of the existence of facts that would
require any such adjustment (except with respect to the exercise of Rights
evidenced by Right Certificates after actual notice of any such adjustment); nor
will it by any act hereunder be deemed to make any representation or warranty as
to the authorization or reservation of any Class A Common Shares to be issued
pursuant to this Agreement or any Right Certificate or as to whether any Class A
Common Shares will, when issued, be validly authorized and issued, fully paid
and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying out or performing by
the Rights Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties hereunder from
any one of the Chairman of the Board, the President, any Vice President, the
Treasurer or the Secretary of the Company, and to apply to such officers for
advice or instructions in connection with its duties, and it will not be liable
for any action taken or suffered to be taken by it in good faith in accordance
with instructions of any such officer or for any delay in acting while waiting
for those instructions.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though it were not Rights Agent
under this Agreement. Nothing herein will 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 will not be
answerable or accountable for any act, default, neglect or misconduct of any
such attorney or agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct, provided reasonable care was exercised in
the selection and continued employment thereof.
(j) No provision of this Agreement will require the Rights
Agent to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder or in the exercise of its
rights if there will be reasonable grounds for believing that repayment of such
funds or adequate indemnification against such risk or liability is not
reasonably assured to it.
(k) The Rights Agent will not be required to take notice or be
deemed to have notice of any fact, event or determination (including, without
limitation, any dates or events defined in this Agreement or the designation of
any Person as an Acquiring Person, Associated Acquiring Person, Affiliate or
Associate) under this Agreement unless and until the Rights Agent is
specifically notified in writing by the Company of such fact, event or
determination.
(l) If, with respect to any Right Certificate surrendered to
the Rights Agent for exercise or transfer, the certificate attached to the form
of assignment or form of election to purchase, as the case may be, has either
not been completed or indicates an affirmative response to clause 1 or 2
thereof, the Rights Agent will not take any further action with respect to such
requested exercise or transfer without first consulting with the Company.
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Section 20. 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 by registered or certified mail
to the Company and to each transfer agent of the Common Shares; if the
resignation occurs after a Triggering Event, notice in writing will, at the
expense of the Company, also be sent by first class mail to the holders of the
Right Certificates. The Rights Agent or any successor Rights Agent that the
Company may appoint may, prior to a Triggering Event, be removed by the Company
and be discharged from its duties under this Agreement upon 30 days notice in
writing mailed by registered or certified mail to the Rights Agent and to each
transfer agent of the Common Shares. If the Rights Agent resigns or is removed
by the Company or otherwise becomes incapable of acting, the Company will
appoint a successor to the Rights Agent. If the Company fails to make such
appointment within a period of 30 days 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 will, with such notice, submit his
Right Certificate for inspection by the Company) or after it has given notice of
such removal, then the registered holder of any Right Certificate may apply to
any court of competent jurisdiction for the appointment of a successor Rights
Agent. Any successor Rights Agent, whether appointed by the Company or by such a
court, will be a corporation organized and doing business under the law of the
United States or of any other state of the United States, in good standing, that
is authorized under such laws to exercise corporate trust powers and is subject
to supervision or examination by federal or state authority or that 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 will be vested
with the same powers, rights, duties and responsibilities as if it had been
originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent will 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 will file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Shares. Failure to give any notice provided for in this Section 20 or
any defect therein, however, will 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 21. ISSUANCE OF NEW RIGHT CERTIFICATES.
Notwithstanding any of the provisions of this Agreement or of the Rights to the
contrary, the Company may, at its option, issue new Right Certificates
evidencing Rights in such form as may be approved by its Board of Directors to
reflect any adjustment or change in the Purchase Price or the Exercise Price per
share and the number, 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 22. REDEMPTION.
(a) The Board of Directors of the Company may, at its option,
at any time prior to the earlier of the Shares Acquisition Date or the
Expiration Date, redeem all but not less than all of the then outstanding Rights
at a redemption price of $0.005 per Right, appropriately further adjusted to
reflect any stock split, stock dividend or similar transaction occurring after
the date hereof (the "Redemption Price").
(b) Immediately upon the action of the Board of Directors of
the Company ordering the redemption of the Rights, and without any further
action and without any notice, the right to exercise the Rights will terminate
and the only right thereafter of the holders of Rights will be to receive the
Redemption Price. Within ten calendar days after the action of the Board of
Directors ordering the redemption of the Rights, the Company will give notice of
such redemption to the holders of the then outstanding Rights by mailing such
notice to all such holders at their last addresses as they appear upon the
registry books of the Rights Agent or, prior to the Shares Acquisition Date, on
the registry books of the transfer agent for the Common Shares. Any notice that
is mailed in the manner herein provided will be deemed given, whether or not the
holder receives the notice. Each such notice of redemption will state the method
by which the payment of the Redemption Price will be made. Neither the Company
nor any of its Affiliates or Associates may redeem, acquire or purchase for
value any of the Rights at any time in any manner other than that specifically
set forth in this Section 22 or in connection with the repurchase of Common
Shares prior to the Shares Acquisition Date.
Section 23. NOTICE OF CERTAIN EVENTS. In case the Company
proposes at any time following the Shares Acquisition Date to (a) pay any
dividend payable in stock of any class to the holders of Class A Common Shares
or make any other distribution to the holders of Class A Common Shares (other
than dividends payable in
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Class A Shares and regular cash dividends), (b) offer to the holders of Class A
Common Shares rights or warrants to subscribe for or to purchase any additional
Class A Common Shares or shares of stock of any class or any other securities,
rights or options, (c) effect any reclassification of its Common Shares, (d)
effect any consolidation or merger into or with, or to effect any sale or other
transfer (or to permit one or more of its Subsidiaries to effect any sale or
other transfer), in one or more transactions, of more than 50% of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to, any
other Person, or (e) effect the liquidation, dissolution or winding up of the
Company, then, in each such case, the Company will give to the Rights Agent and
to each holder of a Right, in accordance with Section 24, a notice of such
proposed action, which will specify the record date for the purposes of such
stock dividend, distribution of rights or warrants, or the date on which such
reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution or winding up is to take place and the date of participation therein
by the holders of the Class A Common Shares, if any such date is to be fixed,
and such notice will be so given, in the case of any action described in clause
(a) or (b) above, at least twenty days prior to the record date for determining
holders of the Class A Common Shares for purposes of such action and, in the
case of any such other action, at least twenty days prior to the date of the
taking of such proposed action or the date of participation therein by the
holders of the Class A Common Shares, whichever will be the earlier.
In case of any Triggering Event, then the Company will as soon
as practicable thereafter give to the Rights Agent and to each holder of a
Right, in accordance with Section 24, a notice of the occurrence of such
Triggering Event, which will specify the event and the consequences of the event
to holders of Rights under Section 11(a)(ii).
Section 24. 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 will be sufficiently given or made if
personally delivered or sent by first-class mail, postage prepaid, addressed
(until another address is filed in writing with the Rights Agent) as follows:
Xx-Xxx Stores, Inc.
0000 Xxxxxx Xxxx
Xxxxxx, Xxxx 00000
Attention: President
Subject to the provisions of Section 20, 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 will be sufficiently given or made if
personally delivered or sent by registered or certified mail and will be deemed
given upon receipt, addressed (until another address is filed in writing with
the Company) as follows:
National City Bank
0000 Xxxx 0xx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Corporate Trust Administration
Notices or demands authorized by this Agreement to be given or
made by the Company or the Rights Agent to or on the holder of any Right
Certificate will be sufficiently given or made if personally delivered or 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 25. 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 (i) cure any ambiguity, (ii) correct
or supplement any provision contain herein which may be defective or
inconsistent with any other provision herein, or (iii) prior to the Shares
Acquisition Date, change or supplement the provisions hereunder that the Company
may deem necessary or desirable and not adverse to the interests of the holders
of Common Shares. 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 25, the Rights Agent will execute such
supplement or amendment unless the Rights Agent determines in good faith that
such supplement or amendment would adversely affect its interests under this
Agreement. Prior to the Shares Acquisition Date, the interests of the holders of
Rights will be deemed coincident with the interests of the holders of Common
Shares. Notwithstanding
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anything in this Agreement to the contrary, no supplement or amendment that
changes the rights and duties of the Rights Agent under this agreement will be
effective against the Rights Agent without the execution of such supplement or
amendment by the Rights Agent.
Section 26. SUCCESSORS. All the covenants and provisions of
this Agreement by or for the benefit of the Company or the Rights Agent will
bind and inure to the benefit of their respective successors and assigns
hereunder.
Section 27. DETERMINATION AND ACTIONS BY THE BOARD OF
DIRECTORS, ETC. For all purposes of this Agreement, any calculation of the
number of Class A Common Shares outstanding at any particular time, including
for purposes of determining the particular percentage of such outstanding Class
A Common Shares of which any Person is the Beneficial Owner, will be made in
accordance with the provisions of Rule 13d-3(d)(1)(i) of the General Rules and
Regulations under the Exchange Act. The Board of Directors of the Company will
have the exclusive power and authority to administer this Agreement and to
exercise all rights and powers specifically granted to the Board, or the
Company, or as may be necessary or advisable in the administration of this
Agreement, including, without limitation, the right and power to (i) interpret
the provisions of this Agreement, and (ii) make all determinations deemed
necessary or advisable for the administration of this Agreement (including a
determination to redeem or not redeem the Rights or to amend or supplement this
Agreement). All such actions, calculations, interpretations and determinations
(including, for the purpose of clause (ii) below, all omissions with respect to
the foregoing) that are done or made by the Board in good faith, will (i) be
final, conclusive and binding on the Company, the Rights Agent, the holders of
the Right Certificates and all other parties, and (ii) not subject the Board to
any liability to any holder of any Right Certificate.
Section 28. BENEFITS OF THIS AGREEMENT. Nothing in this
Agreement will 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 Shares Acquisition Date, the registered holders of the Common
Shares) any legal or equitable right, remedy or claim under this Agreement; but
this Agreement will 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 Shares Acquisition Date, the registered holders of the Common Shares).
Section 29. 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 will remain in
full force and effect and will in no way be affected, impaired or invalidated
Section 30. GOVERNING LAW. This Agreement and each Right
Certificate will be deemed to be a contract made under the laws of the State of
Ohio and for all purposes will be governed by and construed in accordance with
the laws of such State applicable to contracts to be made and performed entirely
within such State.
Section 31. COUNTERPARTS. This Agreement may be executed in
any number of counterparts and each of such counterparts will for all purposes
be deemed to be an original, and all such counterparts will together constitute
but one and the same instrument.
Section 32. DESCRIPTIVE HEADINGS. Descriptive headings of the
Sections of this Agreement are inserted for convenience only and will not
control or affect the meaning or construction of any of the provisions hereof.
[signature page follows]
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and attested, all as of the day and year first
above written.
XX-XXX STORES, INC. ATTEST:
By: /s/ Xxxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxx
----------------------------------- ------------------------------
Name: Xxxxx X. Xxxxxx Name: Xxxxxx X. Xxxxxx
--------------------------------- ----------------------------
Title: Executive Vice President, CFO Title: Vice President, Finance
-------------------------------- ---------------------------
[RIGHTS AGENT] ATTEST:
By: /s/ Xxxxx X. Xxxxx By: /s/ Xxxxxxxx X. Xxxxxxxxx
----------------------------------- ------------------------------
Name: Xxxxx X. Xxxxx Name: Xxxxxxxx X. Xxxxxxxxx
--------------------------------- ----------------------------
Title: Vice President Title: Vice President
-------------------------------- ---------------------------
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INDEX OF DEFINED TERMS
Page
----
Acquiring Person.........................................................1
Affiliate................................................................2
Agreement................................................................1
Associate................................................................2
Associated Acquiring Person..............................................2
Beneficial Owner.........................................................2
beneficially own.........................................................2
Business Day.............................................................3
Class A Common Shares....................................................3
Class B Common Shares....................................................3
Close of business........................................................3
Common Shares............................................................3
Company..................................................................1
current market price....................................................12
Exchange Act.............................................................2
Exercise Price...........................................................3
Expiration Date..........................................................7
Family Members...........................................................3
Issuance.................................................................4
NASDAQ..................................................................13
NYSE....................................................................13
Person...................................................................4
Purchase Price...........................................................4
Redemption Price........................................................22
Right....................................................................1
Rights Agent.............................................................1
SEC......................................................................4
Securities Act...........................................................9
Shares Acquisition Date..................................................4
Subsidiary...............................................................4
Trading Day.............................................................13
Triggering Event........................................................11
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EXHIBIT A
[FORM OF RIGHT CERTIFICATE]
Certificate No. R - ___________ Rights
NOT EXERCISABLE AFTER october 31, 2010 OR EARLIER IF NOTICE OF
REDEMPTION IS GIVEN. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE
OPTION OF THE COMPANY, AT $0.005 PER RIGHT ON THE TERMS SET FORTH IN
THE amended and restated RIGHTS AGREEMENT. [THE RIGHTS REPRESENTED BY
THIS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR
BECAME AN ACQUIRING PERSON OR AN ASSOCIATED ACQUIRING PERSON (AS SUCH
TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHT
CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID
IN THE CIRCUMSTANCES SPECIFIED IN Section 7(e) OF THE RIGHTS
AGREEMENT.]*
RIGHT CERTIFICATE
This certifies that _________________, or registered assigns,
is the registered owner of the number of Rights set forth above, each of which
entitles the owner thereof, subject to the terms, provisions and conditions of
the Amended and Restated Rights Agreement, dated as of October 31, 2000 and as
amended to date (the "Rights Agreement"), between Xx-Xxx Stores, Inc., an Ohio
corporation (the "Company"), and ____________________, as Rights Agent (the
"Rights Agent"), to purchase from the Company at any time after the Shares
Acquisition Date (as such term is defined in the Rights Agreement) and prior to
5:00 P.M., Cleveland time, on October 31, 2010, at the principal office of the
Rights Agent, or its successors as Rights Agent, in __________, ___________, one
Class A Common Share of the Company (the "Class A Common Share"), at a purchase
price of $60.00 per 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, the number
of Class A Common Shares that may be purchased upon exercise thereof and the
Purchase Price per share set forth above are the numbers and Purchase Price as
of October 31, 2000, based on the Class A Common Shares of the Company as
constituted at such date.
Upon the occurrence of a Triggering Event (as such term is
defined in the Rights Agreement), each Right will entitled the holder to
receive, upon presentation and surrender of this Right Certificate with the Form
of Election to Purchase duly executed, one Class A Common Share for an Exercise
Price of $.50 per share (the "Exercise Price").
If the Rights evidenced by this Right Certificate are or at
any time were beneficially owned by an Acquiring Person or an Associated
Acquiring Person (as such terms are defined in the Rights Agreement), such
Rights will become null and void and no holder hereof will have any right with
respect to such Rights from and after the occurrence of such Triggering Event.
As provided in the Rights Agreement, the Purchase Price, the
Exercise Price and number and kind of Class A Common Shares or other securities
that 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; reference is 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 office of the Rights Agent in ________, ________. In
--------
* The portion of the legend in brackets will be inserted only if
applicable.
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addition, the Company will mail to the holder of this certificate a copy of the
Rights Agreement (as in effect on the date of mailing) without charge promptly
after receipt of a written request therefor.
This Right Certificate, with or without other Right
Certificates, upon surrender at the principal office of the Rights Agent, may be
exchanged for another Right Certificate or Right Certificates of like tenor and
date evidencing Rights entitling the holder to purchase a like aggregate number
of Class A Common Shares as the Rights evidenced by the Right Certificate or
Right Certificates surrendered entitled such holder to purchase. If this Right
Certificate is exercised in part, the holder will 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 Right Certificate may be redeemed by the Company at its option
at a redemption price of $0.005 per Right.
The Company will not issue any fractional Class A Common
Shares upon the exercise of any Right or Rights evidenced hereby, but in lieu
thereof may make a cash payment, as provided in the Rights Agreement.
No holder of this Right Certificate will be entitled to vote
or receive dividends or be deemed for any purpose the holder of the Class A
Common Shares or of any other securities of the Company that may at any time be
issuable on the exercise hereof, nor will anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any
of the rights of a shareholder of the 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 the Rights Agreement), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced by this Right
Certificate have been exercised as provided in the Rights Agreement.
This Right Certificate will not be valid or obligatory for any
purpose until it has been countersigned by the Rights Agent.
WITNESS the signature (which may be by facsimile) of the
proper officers of the Company. Dated as of __________________, 20___.
XX-XXX STORES, INC. ATTEST:
By:_____________________________ By:_____________________________
Name:___________________________ Name:___________________________
Title:____________________________ Title:__________________________
Countersigned:
By:_____________________________
Name:___________________________
Title:__________________________
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[FORM OF REVERSE SIDE OF RIGHT CERTIFICATE]
FORM OF ASSIGNMENT
(To be executed by the registered holder if the
holder desires to transfer the Right Certificate)
FOR VALUE RECEIVED _________________________________ hereby
sells, assigns and transfers unto
(Please print name and address of transferee)
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint _______________________________
as attorney, to transfer the Right Certificate on the books of Xx-Xxx Stores,
Inc., with full power of substitution.
Dated: __________________, 20___
Signature
Signature Guaranteed:
CERTIFICATE
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) this Right Certificate [ ] is [ ] is not being sold,
assigned and transferred by or on behalf of a Person who is or was an Acquiring
Person or an Associated Acquiring Person (as such terms are defined in the
Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, the undersigned [ ] did [ ] did not acquire the Rights evidenced by
this Right Certificate from any Person who is, was or subsequently became an
Acquiring Person or an Associated Acquiring Person.
Dated: __________________, 20___
Signature
NOTICE
The signature to the foregoing Assignment and Certificate must
correspond to the name as written upon the face of this Right Certificate in
every particular, without alteration, enlargement or change.
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FORM OF ELECTION TO PURCHASE CLASS A COMMON SHARES
(To be executed if the holder desires to
exercise the Right Certificate in accordance with
Section 11(a)(ii) of the Rights Agreement)
To Xx-Xxx Stores, Inc.:
The undersigned hereby irrevocably elects to exercise
________________ Rights represented by this Right Certificate to purchase the
Class A Common Shares issuable upon the exercise of such Rights and requests
that certificates for such shares be issued in the name of:
(Please print name and address)
Please insert social security
or other identifying number: ______________________________
If such number of Rights are not all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
will be registered in the name of and delivered to:
(Please print name and address)
Please insert social security
or other identifying number: ______________________________
Dated: __________________, 20___
Signature
(Signature must conform in all respects to
name of the holder as specified on the face of
this Right Certificate)
Signature Guaranteed:
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CERTIFICATE
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Right Certificate [ ] are [ ]
are not being exercised by or on behalf of a Person who is or was an Acquiring
Person or an Associated Acquiring Person (as such terms are defined in the
Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it [ ] did [ ] did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or subsequently became an Acquiring
Person or an Associated Acquiring Person.
Dated: ______________, 20___
Signature
NOTICE
The signature to the foregoing Election to Purchase and
Certificate must correspond to the name as written upon the fact of this Right
Certificate in every particular, without alteration or enlargement or any change
whatsoever.
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EXHIBIT B
SUMMARY OF RIGHTS TO PURCHASE
CLASS A COMMON SHARES
The Board of Directors of Xx-Xxx Stores, Inc. (the "Company")
has authorized the issuance of one Right for each outstanding Class A Common
Share, without par value, of the Company (the "Class A Common Shares") and each
Class B Common Share, without par value, of the Company (the "Class A Common
Shares"; the Class A Common Shares and the Class B Common Shares are referred to
together as the "Common Shares"). As of October 31, 2000, Each Right entitles
the registered holder to purchase from the Company one Class A Common Share at a
price of $60.00 (the "Purchase Price"), subject to adjustment. Following the
Shares Acquisition Date (as hereinafter defined) and under the conditions
described below, each Right entitles the registered holder (other than an
Acquiring Person (as hereinafter defined) or Associated Acquiring Person) to
acquire one Class A Common Share for an exercise price of $.50 per share (the
"Exercise Price"). The description and terms of the Rights are set forth in an
Amended and Restated Rights Agreement (the "Rights Agreement"), dated as of
October 31, 2000, by and between the Company and ____________________, as Rights
Agent (the "Rights Agent").
Until there is a public announcement that a person or group of
affiliated or associated persons (an "Acquiring Person") has acquired, or
obtained the right to acquire, beneficial ownership of 15% or more of the Class
A Common Shares then outstanding (the "Shares Acquisition Date"), the Rights
will be evidenced by the certificate for such Class A Common Share.
The Rights Agreement provides that, until the Shares
Acquisition Date, the Rights will be transferred with and only with the
associated Common Shares. Until the Shares Acquisition Date (or the earlier
redemption or expiration of the Rights), the surrender for transfer of any
certificate for Common Shares will also constitute the transfer of the Rights
associated with the Common Shares represented by the certificates. As soon as
practicable following the Shares Acquisition Date, separate certificates
evidencing the Rights ("Right Certificates") will be mailed to holders of record
of the Common Shares as of the close of business on the Shares Acquisition Date,
and thereafter such separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Shares Acquisition
Date. The Rights will expire at the close of business on October 31, 2010 unless
earlier redeemed by the Company as described below.
Upon the occurrence of a Triggering Event (as defined in the
Rights Agreement), each holder of a Right, other than Rights that were or are
beneficially owned by an Acquiring Person or an Associated Acquiring Person
(which will thereafter be void), will have the right to receive, upon exercise
of the Right and payment of the Exercise Price, one Class A Common Share of the
Company.
The Purchase Price and the Exercise Price, and the number of
Class A Common Shares or other securities issuable upon exercise of the Rights,
are subject to adjustment from time to time to prevent dilution.
With certain exceptions, no adjustment in the Purchase Price
or the Exercise Price will be required until cumulative adjustments require an
adjustment of at least 1% in the Purchase Price or the Exercise Price. No
fractional shares will be issued and, in lieu thereof, an adjustment in cash
will be made based on the market price of the Class A Common Shares on the last
trading date prior to the date of exercise.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a shareholder of the Company, including, without limitation,
the right to vote or to receive dividends.
At any time prior to the Shares Acquisition Date, the Board of
Directors of the Company may redeem the Rights in whole, but not in part, at a
price of $0.005 per Right (the "Redemption Price"). Immediately upon the action
of the Board of Directors of the Company electing to redeem the Rights, the
Company will make
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announcement thereof, and the right to exercise the Rights will terminate and
the only right of the holders of Rights will be to receive the Redemption Price.
The provisions of the Rights Agreement may be amended by the
Board of Directors in order to cure any ambiguity, to correct any defect or
inconsistency or, prior to the Shares Acquisition Date, to make changes deemed
to be not adverse to the interests of the holders of the Rights.
A copy of the Rights Agreement has been, and any amendments
thereto will be, filed with the Securities and Exchange Commission as an exhibit
to the Company's registration of the Rights on Form 8-A. A copy of the Rights
Agreement is available from the Company free of charge to any holder of Class A
Common Shares of the Company. This summary description of the Rights does not
purport to be complete and is qualified in its entirety by reference to the
Rights Agreement, as it may be amended from time to time.
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