Exhibit 1
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ATLAS AIR WORLDWIDE HOLDINGS, INC.
and
COMPUTERSHARE TRUST COMPANY, as Rights Agent
RIGHTS AGREEMENT
Dated as of June 18, 2001
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TABLE OF CONTENTS
Page
Section 1. Certain Definitions..............................................1
Section 2. Appointment of Rights Agent......................................7
Section 3. Issue of Right Certificates......................................7
Section 4. Form of Right Certificates.......................................9
Section 5. Countersignature and Registration...............................10
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates....................................................11
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights...12
Section 8. Cancellation and Destruction of Right Certificates..............14
Section 9. Reservation and Availability of Shares of Capital Stock.........14
Section 10. Junior Preferred Stock Record Date..............................16
Section 11. Adjustment of Purchase Price, Number of Shares or Number
of Rights.......................................................17
Section 12. Certificate of Adjusted Purchase Price or Number of Shares......25
Section 13. Fractional Rights and Fractional Shares.........................25
Section 14. Rights of Action................................................27
Section 15. Agreement of Right Holders......................................27
Section 16. Right Certificate Holder Not Deemed a Stockholder...............28
Section 17. Concerning the Rights Agent.....................................28
Section 18. Merger or Consolidation or Change of Name of Rights Agent.......29
Section 19. Duties of Rights Agent..........................................30
Section 20. Change of Rights Agent..........................................33
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Page
Section 21. Issuance of New Right Certificates..............................34
Section 22. Redemption and Termination......................................34
Section 23. Exchange........................................................35
Section 24. Notice of Certain Events........................................37
Section 25. Notices.........................................................37
Section 26. Supplements and Amendments......................................38
Section 27. Successors......................................................39
Section 28. Determinations and Actions by the Board of Directors............39
Section 29. Benefits of This Agreement......................................39
Section 30. Severability....................................................40
Section 31. Governing Law...................................................40
Section 32. Counterparts....................................................40
Section 33. Descriptive Headings............................................40
Exhibit A - Certificate of Designation...................................A-1
Exhibit B - Form of Right Certificate....................................B-1
Exhibit C - Summary of Rights to Purchase Junior
Preferred Stock..............................................C-1
Exhibit D - Incumbency Certificate.......................................D-1
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RIGHTS AGREEMENT
Rights Agreement (the "Agreement"), dated as of June 18, 2001, between
Atlas Air Worldwide Holdings, Inc., a Delaware corporation (the "Company"), and
Computershare Trust Company, a Colorado corporation, as Rights Agent (the
"Rights Agent").
W I T N E S S E T H :
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WHEREAS, the Board of Directors of the Company on June 18, 2001 (the
"Rights Dividend Declaration Date") authorized and declared a dividend
distribution (the "Distribution") of one Right for each outstanding share of the
Common Stock, par value $0.01 per share (the "Common Stock"), of the Company
outstanding at the close of business on July 2, 2001 (the "Record Date") and has
authorized and directed the issuance of one Right (as such number may
hereinafter be adjusted pursuant to the provisions hereof) in respect of each
share of Common Stock (as such term is hereinafter defined) issued (whether
originally issued or delivered from the Company's treasury stock) between the
Record Date and the earlier of the Distribution Date or the Expiration Date (as
such terms are hereinafter defined), each Right initially representing the right
to purchase, under certain circumstances, one one-thousandth of a share of
Series A Junior Participating Preferred Stock, $1.00 par value (the "Junior
Preferred Stock"), of the Company having the rights, powers and preferences set
forth in the Certificate of Designation attached hereto as Exhibit A, upon the
terms and subject to the conditions hereinafter set forth (the "Rights");
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" shall mean any Person (as such term is
hereinafter defined) who or which, together with all Affiliates (as such
term is hereinafter defined) and Associates (as such term is hereinafter
defined) of such Person, shall be the Beneficial Owner (as such term is
hereinafter defined) of securities of the Company constituting a
Substantial Block (as such term is hereinafter defined), but shall not
include (i) the Company, any Subsidiary (as such term is hereinafter
defined) of the Company, any employee benefit plan of the Company or of any
Subsidiary of the Company or any Person organized, appointed or established
by the Company or any Subsidiary of the Company for or pursuant to the
terms of any such plan; (ii) any Person who or which, together with all
Affiliates and Associates of such Person, becomes the Beneficial Owner of a
Substantial Block solely as a result of a change in the aggregate num-
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ber of shares of Voting Stock (as such term is hereinafter defined)
outstanding since the last date on which such Person acquired Beneficial
Ownership of any shares of the Voting Stock constituting all or a portion
of such Substantial Block; (iii) any Person who or which, together with all
Affiliates and Associates of such Person, becomes the Beneficial Owner of a
Substantial Block in the good faith belief that such acquisition would not
(x) cause such Person and its Affiliates and Associates to become the
Beneficial Owner of a Substantial Block and such Person relied in good
faith in computing the percentage of its voting power on publicly filed
reports or documents of the Company which are inaccurate or out-of-date or
(y) otherwise cause a Distribution Date or the adjustment provided for in
Section 11(a)(ii) to occur; and (iv) any Xxxxxxx Person (as such term is
hereinafter defined). Notwithstanding clause (ii) or (iii) of the prior
sentence, if any Person that is not an Acquiring Person due to such clause
(ii) or (iii) does not cease to be the Beneficial Owner of a Substantial
Block by the close of business on the fifth Business Day (as such term is
hereinafter defined) after notice from the Company (the date of notice
being the first Business Day) that such Person is the Beneficial Owner of a
Substantial Block, such Person shall, at the end of such five Business Day
period, become an Acquiring Person (and such clause (ii) or (iii) shall no
longer apply to such Person). For purposes of this definition, the
determination whether any Person acted in "good faith" shall be
conclusively determined by the Board of Directors of the Company.
Notwithstanding the foregoing, no Person shall become an "Acquiring Person"
as a result of an acquisition of Voting Stock by the Company which, by
reducing the number of shares of Voting Stock outstanding, increases the
proportionate voting power of Voting Stock beneficially owned by such
Person to 20% or more of the total voting power of the then outstanding
shares of Voting Stock of the Company; provided, however, if a Person shall
become the Beneficial Owner of a Substantial Block as a result of an
acquisition of Voting Stock by the Company and shall, after such
acquisition of Voting Stock by the Company, become the Beneficial Owner of
any additional Voting Stock of the Company other than pursuant to a stock
split, stock dividend or similar transaction, and immediately thereafter be
the Beneficial Owner of a Substantial Block, then such Person shall be
deemed to be an "Acquiring Person."
(b) "Act" shall mean the Securities Act of 1933, as amended.
(c) "Adjustment Shares" shall have the meaning set forth in Section
11(a)(ii) hereof.
(d) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
as in effect on the date hereof.
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(e) "Agreement" shall have the meaning set forth in the introduction
hereto.
(f) A Person shall be deemed the "Beneficial Owner" of and shall be
deemed to "beneficially own" any securities:
(i) which such Person or any of such Person's Affiliates or Associates has,
directly or indirectly, the right to acquire (whether such right is exercisable
immediately or only after the passage of time or upon the occurrence of an
event) 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; provided, however, a Person shall not be
deemed the "Beneficial Owner" of, or to "beneficially own," (1) securities
tendered pursuant to a tender or exchange offer made by such Person or any of
such Person's Affiliates or Associates until such tendered securities are
accepted for purchase or exchange, (2) securities issuable upon exercise of
Rights at any time prior to the occurrence of a Triggering Event or (3)
securities issuable upon exercise of Rights from and after the occurrence of a
Triggering Event, which Rights were acquired by such Person or any of such
Person's Affiliates or Associates prior to the Distribution Date or pursuant to
Section 3(a) hereof ("Original Rights") or pursuant to Section 11(i) or Section
21 hereof in connection with an adjustment made with respect to Original Rights;
or
(ii) which such Person or any of such Person's Affiliates or Associates
has, directly or indirectly, the right to vote or dispose of or has "beneficial
ownership" of (as determined pursuant to Rule 13d-3 of the General Rules and
Regulations under the Exchange Act), including pursuant to any agreement,
arrangement or understanding (whether or not in writing) or has a "pecuniary
interest" or an "indirect pecuniary interest" in (as determined pursuant to Rule
16a-1(a)(2) of the General Rules and Regulations under the Exchange Act);
provided, however, a Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially own," any security under this subparagraph (ii) if the agreement,
arrangement or understanding to vote such security (1) arises solely from a
revocable proxy given in response to a public proxy or consent solicitation made
pursuant to, and in accordance with, the applicable rules and regulations of the
Exchange Act and (2) is not then reportable on Schedule 13D under the Exchange
Act (or any comparable or successor report); or
(iii) which are beneficially owned, directly or indirectly, by any other
Person with which such Person or any of such Person's Affiliates or Associates
has any agreement, arrangement or understanding (whether or not in writing) for
the purpose of acquiring, holding, voting (except pursuant to a revocable proxy
as described in the proviso to subparagraph (ii) of this paragraph (g)) or
disposing of any securities of the Company.
Notwithstanding the foregoing, nothing contained in this definition shall
cause a Person ordinarily engaged in business as an underwriter of securities to
be the "Beneficial
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Owner" of, or to "beneficially own," any securities acquired in a bona fide firm
commitment underwriting pursuant to an underwriting agreement with the Company.
(g) "Business Day" shall mean any day other than a Saturday, Sunday,
or a day on which banking institutions in the State of New York are
authorized or obligated by law or executive order to close.
(h) "Certification" shall have the meaning set forth in Section 17
hereof.
(i) "Xxxxxxx Person" shall mean (i) Xxxxx X. Xxxxxxx, her lineal
descendants and their spouses (so long as they remain spouses) and the
estate of any of the foregoing persons, and any partnership, trust,
corporation or other entity to the extent any shares of Voting Stock owned
by such entity are considered beneficially owned by any of such individuals
or estates, and (ii) any person who would be an Acquiring Person solely by
reason of being deemed to be the Beneficial Owner of shares of Voting Stock
beneficially owned by any such estate or entity, whether by acting as an
officer, director, executor, trustee, personal representative or other
managing person of any such entity, or by reason of any ownership interest
or other pecuniary interest in any such entity, or having an agreement,
arrangement or understanding with any such individual, estate or entity.
(j) "close of business" on any given date shall mean 5:00 P.M., New
York City time, on such date; provided, however, if such date is not a
Business Day it shall mean 5:00 P.M., New York City time, on the next
succeeding Business Day.
(k) "Common Stock" when used with reference to the Company shall mean
the Common Stock, $0.01 par value, of the Company. "Common Stock" when used
with reference to any Person other than the Company shall mean either the
capital stock with the greatest voting power of such other Person or, if
such Person is a Subsidiary of another Person, the equity securities or
other equity interest having power to control or direct the management of
such other Person.
(l) "Common Stock Equivalents" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(m) "Company" shall have the meaning set forth in the introduction
hereto.
(n) "Current Market Price" shall have the meaning set forth in Section
11(d) hereof.
(o) "Current Value" shall have the meaning set forth in Section
11(a)(iii) hereof.
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(p) "Distribution" shall have the meaning set forth in the recitals
hereto.
(q) "Distribution Date" shall have the meaning set forth in Section
3(a) hereof.
(r) "Equivalent Junior Preferred Stock" shall have the meaning set
forth in Section 11(b) hereof.
(s) "Exchange Act" shall have the meaning set forth in the definitions
of "Affiliate" and "Associate" above.
(t) "Exchange Ratio" shall have the meaning set forth in Section 23(a)
hereof.
(u) "Expiration Date" shall have the meaning set forth in Section 7(a)
hereof.
(v) "Final Expiration Date" shall have the meaning set forth in
Section 7(a) hereof.
(w) "Incumbency Certificate" shall have the meaning set forth in
Section 26 hereof.
(x) "Junior Preferred Stock" shall mean the shares of Series A Junior
Participating Preferred Stock, par value $1.00 per share, of the Company.
(y) "NASDAQ" shall have the meaning set forth in Section 11(d)(i)
hereof.
(z) "Original Rights" shall have the meaning set forth in the
definition of "Beneficial Owner" above.
(aa) "Person" shall mean any individual, firm, corporation,
partnership, trust or other entity.
(bb) "Purchase Price" shall have the meaning set forth in Section 4(a)
hereof.
(cc) "Record Date" shall have the meaning set forth in the recitals
hereto.
(dd) "Redemption Price" shall have the meaning set forth in Section
22(a) hereof.
(ee) "Right" shall have the meaning set forth in the recitals hereto.
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(ff) "Right Certificate" shall have the meaning set forth in Section
3(a) hereof.
(gg) "Rights Agent" shall have the meaning set forth in the
introduction hereto.
(hh) "Rights Dividend Declaration Date" shall have the meaning set
forth in the recitals hereto.
(ii) "Section 11(a)(ii) Event" shall mean any event described in
Section 11(a)(ii) hereof.
(jj) "Section 11(a)(ii) Trigger Date" shall have the meaning set forth
in Section 11(a)(iii) hereof.
(kk) "Shares Acquisition Date" shall mean the first date of public
announcement (which, for purposes of this definition, includes a report
filed pursuant to Section 13(d) of the Exchange Act) by the Company or an
Acquiring Person that an Acquiring Person has become such.
(ll) "Spread" shall have the meaning set forth in Section 11(a)(iii)
hereof.
(mm) "Subsidiary" shall mean, with reference to any Person, any
corporation (or other entity) of which an amount of voting securities (or
comparable ownership interests) sufficient to elect at least a majority of
the directors (or comparable individuals) of such corporation (or other
entity) is beneficially owned or otherwise controlled, directly or
indirectly, by such Person.
(nn) "Substantial Block" shall mean a number of shares of the Voting
Stock which are entitled to twenty percent (20%) or more (without regard to
any instruments, agreements, arrangements or understandings to which a
holder thereof may be a party or to which such shares may be subject or by
which such shares may be bound) of the aggregate voting power of all
outstanding shares of Voting Stock.
(oo) "Substitution Period" shall have the meaning set forth in Section
11(a)(iii) hereof.
(pp) "Summary of Rights" shall have the meaning set forth in Section
3(b) hereof.
(qq) "Trading Day" shall have the meaning set forth in Section
11(d)(i) hereof.
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(rr) "Triggering Event" shall mean any Section 11(a)(ii) Event.
(ss) "Voting Stock" when used with reference to the Company shall mean
the Common Stock and any other outstanding shares of capital stock of the
Company which are entitled to vote generally in the election of directors.
Any term defined in the singular shall have the same meaning in the plural and
any term defined in the plural shall have the same meaning in the singular.
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 shall act as Co-Rights Agent and may from time to time appoint such
other Co-Rights Agents as it may deem necessary or desirable upon ten calendar
days' written notice to the Rights Agent. In no event shall the Rights Agent
have any duty to supervise or in any way be liable for the actions or omissions
of such Co-Rights Agents.
Section 3. Issue of Right Certificates. (a) Until the earlier of (i) the
close of business on the tenth calendar day after the Shares Acquisition Date
(or, if the tenth calendar day after the Shares Acquisition Date occurs before
the Record Date, the close of business on the Record Date) or (ii) the close of
business on the tenth calendar day (or such later date as may be determined by
action of the Board of Directors prior to such time as any Person becomes an
Acquiring Person) after the date of the commencement of, or first public
announcement of the intent of any Person (other than the Company, any Subsidiary
of the Company, any employee benefit 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) to
commence, a tender or exchange offer if, upon consummation thereof, such Person
would be an Acquiring Person (the earlier of the dates in subsections (i) and
(ii) hereof being herein referred to as the "Distribution Date") (x) the Rights
will be evidenced (subject to the provisions of paragraph (b) of this Section 3)
by the certificates for the Common Stock registered in the names of the holders
of the Common Stock (which certificates for the Common Stock shall be deemed
also to be Right Certificates) and not by separate Right Certificates, and (y)
the right to receive Right Certificates will be transferable only in connection
with the transfer of Common Stock. As soon as practicable after receipt by the
Rights Agent of written notice from the Company of the Distribution Date, the
Rights Agent, at the Company's expense, will send by first-class, postage
prepaid mail, to each record holder of Common Stock as of the close of business
on the Distribution Date, at the address of such holder shown on the records of
the Company, a Right Certificate in substantially the form of Exhibit B hereto
(the "Right Certificate"), evidencing one Right for each share of the Common
Stock so held, subject to adjustment as provided
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herein. As of the Distribution Date, the Rights will be evidenced solely by such
Right Certificates.
(b) As soon as practicable following the Record Date, the Company will send
a copy of a Summary of Rights to Purchase Junior Preferred Stock, in
substantially the form attached hereto as Exhibit C (the "Summary of Rights"),
by first-class, postage prepaid mail, to each record holder of Common Stock as
of the close of business on the Record Date, at the address of such holder shown
on the records of the Company. With respect to certificates for Common Stock
outstanding as of the Record Date, until the Distribution Date, the Rights will
be evidenced by such certificates for Common Stock, and the registered holders
of the Common Stock shall also be the registered holders of the associated
Rights. Until the Distribution Date (or earlier redemption or expiration of the
Rights), the surrender for transfer or conversion of any of the certificates for
Common Stock outstanding on the Record Date shall also constitute the transfer
of the Rights associated with the Common Stock represented by such certificate.
(c) Rights shall be issued in respect of all shares of Common Stock issued
after the Record Date but prior to the earlier of the Distribution Date or the
Expiration Date (as such term is defined in Section 7), or, in certain
circumstances provided in Section 21 hereof, after the Distribution Date.
Certificates representing such shares of Common Stock shall have impressed on,
printed on, written on or otherwise affixed to them the following legend:
This certificate also evidences and entitles the holder hereof to certain
Rights as set forth in a Rights Agreement between Atlas Air Worldwide
Holdings, Inc. and Computershare Trust Company dated as of June 18, 2001
(the "Rights Agreement"), the terms of which are hereby incorporated herein
by reference and a copy of which is on file at the principal executive
offices of Atlas Air Worldwide Holdings, Inc. Under certain circumstances,
as set forth in the Rights Agreement, such Rights will be evidenced by
separate certificates and will no longer be evidenced by this certificate.
Atlas Air Worldwide Holdings, Inc. will mail to the holder of this
certificate a copy of the Rights Agreement as in effect on the date of
mailing without charge within five Business Days after receipt of a written
request therefor. Rights beneficially owned by an Acquiring Person and
certain other persons will be null and void under certain circumstances set
forth in the Rights Agreement.
After the due execution of any supplement or amendment to this Agreement in
accordance with the terms hereof, the reference to this Agreement in the
foregoing legend shall mean the Agreement as so supplemented or amended. Until
the Distribution Date, the Rights associated with the Common Stock represented
by certificates containing the foregoing legend shall be
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evidenced by such certificates alone, and the surrender for transfer or
conversion of any of such certificates shall also constitute the transfer of the
Rights associated with the Common Stock represented by such certificate. In the
event that the Company purchases or acquires any shares of Common Stock after
the Record Date but prior to the Distribution Date, any Rights associated with
such Common Stock shall be deemed canceled and retired so that the Company shall
not be entitled to exercise any Rights associated with the shares of Common
Stock which are no longer outstanding. The failure to print the foregoing legend
on any such Common Stock certificate or any other defect therein shall not
affect in any manner whatsoever the application or interpretation of the
provisions of Section 7(e) hereof.
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) shall be substantially the same as Exhibit B hereto and may
have such marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate (but which do
not affect the rights or duties of the Rights Agent) and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with any
rule or regulation of the NASDAQ National Market or of any stock exchange on
which the Rights may from time to time be listed, or to conform to usage. The
Right Certificates shall be in machine-printable format and in a form reasonably
satisfactory to the Rights Agent. Subject to the provisions of Section 11 and
Section 21 hereof, the Right Certificates, whenever distributed, shall be dated
as of the Record Date, shall show the date of countersignature, and on their
face shall entitle the holders thereof to purchase such number of shares of
Junior Preferred Stock (or following a Triggering Event, Common Stock, other
securities, cash or other assets, as the case may be) as shall be set forth
therein at the price per one one-thousandth of a share of Junior Preferred Stock
set forth therein (the "Purchase Price"), but the number of such shares and the
Purchase Price shall be subject to adjustment as provided herein.
(b) Notwithstanding any other provision of this Agreement, (i) any Right
Certificate issued pursuant to Section 3(a) or Section 21 hereof that represents
Rights beneficially owned by: (x) an Acquiring Person or any Associate or
Affiliate thereof, (y) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee after the Acquiring Person
becomes such or (z) 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 such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the Acquiring Person to
holders of equity interests in such Acquiring Person or to any Person with whom
such Acquiring Person has any agreement, arrangement or understanding (whether
or not in writing) regarding the transferred Rights or (B) a transfer which the
Board of Directors of the Company has determined is part of a plan, arrangement
or understanding (whether or not in writing) which has as a primary
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purpose or effect avoidance of Section 7(e) hereof, (ii) any Right Certificate
issued at any time to any nominee of such Acquiring Person, Associate or
Affiliate and (iii) any Right Certificate issued pursuant to Section 6 or
Section 11 hereof, upon transfer, exchange, replacement or adjustment of any
other Right Certificate referred to in this sentence, shall contain (to the
extent feasible following the written instruction of the Company to the Rights
Agent) the following legend, modified as applicable to apply to such Person:
The Rights represented by this Right Certificate are or were beneficially
owned by a Person who was or became an Acquiring Person or an Affiliate or
an Associate of an Acquiring Person (as such terms are defined in the
Rights Agreement). Accordingly, this Right Certificate and the Rights
represented will be null and void in the circumstances specified in Section
7(e) of the Rights Agreement.
The Company shall instruct the Rights Agent in writing of the Rights which
should be so legended and shall supply the Rights Agent with such legended Right
Certificates.
Section 5. Countersignature and Registration. The Right Certificates shall
be executed on behalf of the Company by one of its authorized officers either
manually or by facsimile signature. The Right Certificates shall be
countersigned by an authorized signatory of the Rights Agent either manually or
by facsimile signature and shall not be valid for any purpose unless so
countersigned. In case any officer of the Company who shall have signed any of
the Right Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Right Certificates, nevertheless, may be countersigned by the Rights Agent,
issued and delivered with the same force and effect as though the person who
signed such Right Certificates had not ceased to be such officer of the 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, shall be a
proper officer of the Company to sign such Right Certificate, although at the
date of the execution of this Agreement any such person was not such an officer.
In case any authorized signatory of the Rights Agent who shall have
countersigned any of the Right Certificates shall cease to be such signatory
before delivery by the Company, such Right Certificates, nevertheless, may be
issued and delivered by the Company with the same force and effect as though the
person who countersigned such Right Certificates had not ceased to be such
signatory; and any Right Certificate may be countersigned on behalf of the
Rights Agent by any person who, at the actual date of the countersignature of
such Right Certificate, shall be a proper signatory of the Rights Agent to
countersign such Right Certificate, although at the date of the execution of
this Agreement any such person was not such a signatory.
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Following the Distribution Date, the Rights Agent will keep or cause to be
kept, at its office designated for such purpose, books for registration and
transfer of the Right Certificates issued hereunder. Such books shall show the
names and addresses of the respective holders of the Right Certificates, the
number of Rights evidenced on its face by each of the Right Certificates, the
date of each of the Right Certificates and the date of countersignature of each
of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates. Subject
to the provisions of Section 13 hereof, at any time after the close of business
on the Distribution Date, and at or prior to the close of business on the
Expiration Date, any Right Certificate or Right Certificates may be transferred,
split up, combined or exchanged for another Right Certificate or Right
Certificates, entitling the registered holder to purchase a like number of
shares of Junior Preferred Stock (or following a Triggering Event, Common Stock,
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 shall make such request in writing delivered to the Rights
Agent, and shall surrender the Right Certificate or Right Certificates to be
transferred, split up, combined or exchanged at the office of the Rights Agent
designated for such purpose, along with a signature guarantee and such other and
further documentation as the Rights Agent may reasonably request. Neither the
Rights Agent nor the Company shall be obligated to take any action whatsoever
with respect to the transfer of any such surrendered Right Certificate until the
registered holder shall have completed and signed the certificate contained in
the form of assignment on the reverse side of such Right Certificate and shall
have provided such additional evidence, as the Company or the Rights Agent shall
reasonably request, of the identity of the Beneficial Owner, Affiliates or
Associates thereof or of the holder, or of any other Person with which such
holder or any of such holder's Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing) for the purpose of
acquiring, holding, voting or disposing of securities of the Company. Thereupon
the Rights Agent shall, subject to Section 4(b), Section 7(e), Section 13 and
Section 19(k) hereof, 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 from a Right Certificate holder 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. The Rights Agent shall have no duty or obligation to take any
action under any Section of this Agreement which requires the payment by a
Rights holder of applicable taxes and governmental charges unless and until the
Rights Agent is satisfied that all such taxes and/or charges have been paid.
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
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case of loss, theft or destruction, of indemnity or security satisfactory to
them, along with a signature guarantee and such other further documentation as
the Rights Agent may reasonably request and reimbursement to the Company and the
Rights Agent of all reasonable expenses incidental thereto, and upon surrender
to the Rights Agent and cancellation of the Right Certificate, if mutilated, 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.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights.
(a) Subject to Section 7(e) hereof, the registered holder of any Right
Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein, including, without limitation, the restrictions on
exercisability set forth in Sections 3(a), 9(c), 11(a)(iii), 22(a) and 23(b)
hereof) in whole or in part at any time after the Distribution Date upon
surrender of the Right Certificate, with the form of election to purchase on the
reverse side thereof duly executed, to the Rights Agent at the designated office
of the Rights Agent, together with payment of the aggregate Purchase Price for
the total number of one one-thousandths of a share of Junior Preferred Stock (or
shares of Common Stock, other securities, cash or other assets, as the case may
be) as to which the Rights are then exercisable, at or prior to the earliest of
(i) the close of business on July 2, 2011 (the "Final Expiration Date"), (ii)
the time at which the Rights are exchanged as provided in Section 23 or (iii)
the time at which the Rights are redeemed as provided in Section 22 (such
earliest date being herein referred to as the "Expiration Date").
(b) The Purchase Price for each one one-thousandth of a share of Junior
Preferred Stock pursuant to the exercise of a Right shall initially be $115,
shall be subject to adjustment from time to time as provided in Section 11
hereof and shall be payable in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing exercisable Rights,
with the form of election to purchase and the certificate duly executed and
completed accompanied by payment of the Purchase Price for the number of one
one-thousandths of shares of Junior Preferred Stock (or shares of Common Stock,
other securities, cash or other assets, as the case may be) to be purchased and
an amount equal to any applicable transfer tax, the Rights Agent shall
thereupon, subject to Section 19(k), promptly (i) requisition from any transfer
agent of Junior Preferred Stock (or make available, if the Rights Agent is the
transfer agent for such shares) certificates for the number of one
one-thousandths of shares of Junior Preferred Stock to be purchased and the
Company hereby irrevocably authorizes its transfer agent to comply with all such
requests, (ii) if the Company shall have elected to deposit the total number of
shares of Junior Preferred Stock issuable upon exercise of the Rights hereunder
with a depositary agent, requisition from the depositary agent depositary
receipts representing such number of shares of Junior Preferred Stock as are to
be purchased (in which case
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certificates for the shares of Junior Preferred Stock represented by such
receipts shall be deposited by the transfer agent with the depositary agent) and
the Company hereby directs the depositary agent to comply with such request,
(iii) when appropriate, requisition from any transfer agent of the Common Stock
of the Company (or make available, if the Rights Agent is the transfer agent for
such shares) certificates for the total number of shares of Common Stock to be
paid in accordance with Section 11(a)(ii) and 11(a)(iii), (iv) when appropriate,
requisition from the Company the amount of cash to be paid in lieu of issuance
of fractional shares in accordance with Section 13, (v) 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 (vi) when appropriate,
after receipt deliver such cash to or upon the order of the registered holder of
such Right Certificate. The payment of the then Purchase Price may be made in
cash or by certified bank check or bank draft or money order payable to the
order of the Company or the Rights Agent. In the event that the Company is
obligated to issue securities, distribute property or pay cash pursuant to
Section 11(a)(iii) hereof, the Company will make all arrangements necessary so
that cash, property or securities are available for payment, distribution or
issuance by the Rights Agent, if and when appropriate.
(d) In case the registered holder of any Right Certificate shall exercise
less than all the Rights evidenced thereby, a new Right Certificate evidencing
Rights equivalent to the Rights remaining unexercised shall be issued by the
Rights Agent to the registered holder of such Right Certificate or to his duly
authorized assigns, subject to the provisions of Section 13 hereof.
(e) Notwithstanding anything in this Agreement to the contrary, from and
after the first occurrence of a Section 11(a)(ii) Event, any Rights beneficially
owned by (i) an Acquiring Person or 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 became 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 such Rights pursuant to either (A) a transfer
(whether or not for consideration) from the Acquiring Person to holders of
equity interests in such Acquiring Person or to any Person with whom the
Acquiring Person has any agreement, arrangement or understanding (whether or not
in writing) regarding the transferred Rights or (B) a transfer which the Board
of Directors of the Company has determined is part of a plan, arrangement or
understanding (whether or not in writing) which has as a primary purpose or
effect the avoidance of this Section 7(e), shall become null and void without
any further action and no holder of such Rights shall have any rights whatsoever
with respect to such Rights, whether under any provision of this Agreement or
otherwise. The Company shall notify the Rights Agent when this Section 7(e)
applies and shall use all reasonable efforts to insure that the provisions of
this Section 7(e) and Section 4(b) hereof are complied with, but neither the
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Company nor the Rights Agent shall have any liability to any holder of Right
Certificates or other Person as a result of the Company's failure to make any
determinations with respect to an Acquiring Person or its Affiliates, Associates
or transferees hereunder. The Rights Agent will endeavor to comply with the
provisions hereof to the extent it has received instructions from the Company
concerning such matters.
(f) Notwithstanding anything in this Agreement to the contrary, neither the
Rights Agent nor the Company shall be obligated to undertake any action with
respect to a registered holder upon the occurrence of any purported exercise as
set forth in this Section 7 unless such registered holder shall have (i)
completed and signed the certificate contained in the form of election to
purchase set forth on the reverse side of the Right Certificate surrendered for
such exercise and (ii) provided such additional evidence of the identity of the
Beneficial Owner, Affiliates or Associates thereof or of the holder, or of any
other Person with which such holder or any of such holder's Affiliates or
Associates has any agreement, arrangement or understanding (whether or not in
writing) for the purpose of acquiring, holding, voting or disposing of any
securities of the Company as the Company or the Rights Agent shall reasonably
request.
Section 8. Cancellation of Right Certificates. All Right Certificates
surrendered for the purpose of exercise, transfer, split up, combination or
exchange shall, if surrendered to the Company or to any of its agents, be
delivered to the Rights Agent for cancellation or in canceled form, or, if
surrendered to the Rights Agent, shall be canceled by it, and no Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Agreement. The Company shall deliver to the Rights
Agent for cancellation and retirement, and the Rights Agent shall so cancel and
retire, any other Right Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall deliver all
canceled Right Certificates to the Company.
Section 9. Reservation and Availability of Shares of Capital Stock. (a) The
Company covenants and agrees that it will cause to be reserved and kept
available out of its authorized and unissued shares of Junior Preferred Stock
(and, following the occurrence of a Triggering Event, out of its authorized and
unissued shares of Common Stock and/or other securities) or out of its
authorized and issued shares of Junior Preferred Stock (and, following the
occurrence of a Triggering Event, out of its authorized and issued Common Stock
and/or other securities) held in its treasury, the number of shares of Junior
Preferred Stock (and, following the occurrence of a Triggering Event, Common
Stock and/or other securities) that will be sufficient to permit the exercise in
full of all outstanding Rights (it being understood that any of the foregoing
shares or securities may also be reserved for other purposes) or will take such
other steps as are appropriate to assure that the number of such shares or
securities (or their equivalents) sufficient to permit the exercise in full of
all outstanding Rights will be available upon such exercise.
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(b) So long as the shares of Junior Preferred Stock (and, following the
occurrence of a Triggering Event, Common Stock and/or other securities) issuable
upon the exercise of Rights may be listed on any national securities exchange,
or admitted to trading on NASDAQ, the Company shall use its best efforts to
cause, from and after such time as the Rights become exercisable (but only to
the extent that the Board of Directors of the Company determines that it is
reasonably likely that the Rights will be exercised), all shares reserved for
such issuance to be listed on such exchange or admitted to trading on NASDAQ
upon official notice of issuance upon such exercise.
(c) The Company shall use its best efforts (X)(i) to file, as soon as
practicable following the first occurrence of a Section 11(a)(ii) Event, or as
soon as required by law, as the case may be, a registration statement under the
Act with respect to the securities purchasable upon exercise of the Rights on an
appropriate form, (ii) to cause such registration statement to become effective
as soon as practicable after such filing and (iii) to cause such registration
statement to remain effective (with a prospectus at all times meeting the
requirements of the Act) until the earlier of (A) the date as of which the
Rights are no longer exercisable for such securities and (B) the Expiration Date
and (Y)(i) to file appropriate applications with any state or federal regulatory
bodies having jurisdiction over the issuance of the securities (or assets)
purchasable upon exercise of the Rights in order to obtain any approvals or
orders of such bodies as may be legally required, (ii) to cause such approvals
to be obtained or orders to be issued as soon as practicable after such filing
and (iii) to cause such approvals or orders to remain effective until the
earlier of (A) the date as of which the Rights are no longer exercisable for
such securities (or assets) and (B) the Expiration Date, to the extent not
previously obtained. The Company will also take such action as may be
appropriate under the blue sky laws of the various states. The Company may
temporarily suspend, (X) for a period of time not to exceed ninety (90) days
after the date set forth in clause (X)(i) of the first sentence of this Section
9(c), the exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective and (Y) for a period of
time not in excess of one hundred eighty (180) days after such date (or for such
longer period as is required by any applicable law or rule or regulation of any
appropriate regulatory bodies), the exercisability of the Rights in order to
obtain any such required regulatory body approvals or orders. Upon any such
suspension, the Company shall issue a public announcement and shall give
simultaneous written notice to the Rights Agent stating that the exercisability
of the Rights has been temporarily suspended, as well as 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 shall not be exercisable in any jurisdiction unless the requisite
qualifications in such jurisdiction shall have been obtained. The Rights Agent
may assume that any Right exercised is permitted to be exercised under
applicable law, unless specifically notified in writing by the Company prior to
such exercise, and shall have no liability for acting in reliance upon such
assumption.
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(d) The Company covenants and agrees that it will take all such action as
may be necessary to ensure that all shares of the Junior Preferred Stock (and
following the occurrence of a Triggering Event, Common Stock and/or other
securities) delivered upon exercise of Rights shall, at the time of delivery of
the certificates for such shares (subject to payment of the Purchase Price), be
duly and validly authorized and issued and fully paid and nonassessable.
(e) The Company further covenants and agrees that it will pay when due and
payable any and all taxes and government charges which may be payable in respect
of the issuance or delivery of the Right Certificates or of any shares of the
Junior Preferred Stock (or Common Stock and/or other securities, as the case may
be) upon the exercise of Rights. The Company shall not, however, be required (a)
to pay any transfer tax which 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 Junior Preferred Stock (or Common Stock and/or other
securities, as the case may be) in a name other than that of the registered
holder of the Right Certificate evidencing Rights surrendered for exercise or
(b) to issue or deliver any certificates for shares of the Junior Preferred
Stock (or Common Stock and/or other securities, as the case may be) upon the
exercise of any Rights until any such tax shall have been paid (any such tax
being payable by the holder of such Right Certificate at the time of surrender)
or until it has been established to the Company's satisfaction that no such tax
is due.
Section 10. Junior Preferred Stock Record Date. Each Person in whose name
any certificate for any number of shares of Junior Preferred Stock (or Common
Stock and/or other securities, as the case may be) is issued upon the exercise
of Rights shall for all purposes be deemed to have become the holder of record
of such whole and/or fractional shares of Junior Preferred Stock (or Common
Stock and/or other securities, as the case may be) represented thereby on, and
such certificate shall be dated the date upon which the Right Certificate
evidencing such Rights was duly surrendered and payment of the Purchase Price
(and any applicable taxes and charges) was made and shall show the date of
countersignature; provided, however, if the date of such surrender and payment
is a date upon which the Junior Preferred Stock (or Common Stock and/or other
securities, as the case may be) transfer books of the Company are closed, such
person shall be deemed to have become the record holder of such shares on, and
such certificate shall be dated, the next succeeding Business Day on which the
Junior Preferred Stock (or Common Stock and/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 shall not be entitled to
any rights of a stockholder of the Company with respect to shares for which the
Rights shall be exercisable, including, without limitation, the right to vote,
to receive dividends or other distributions or to exercise any preemptive
rights, and shall not be entitled to receive any notice of any proceedings of
the Company, except as provided herein.
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Section 11. Adjustment of Purchase Price, Number of Shares or Number of
Rights. The Purchase Price, the number of shares covered by each Right and the
number of Rights outstanding are subject to adjustment from time to time as
provided in this Section 11.
(a) (i) In the event the Company shall at any time after the date of this
Agreement (A) declare a dividend on the Junior Preferred Stock payable in shares
of the Junior Preferred Stock, (B) subdivide the outstanding Junior Preferred
Stock, (C) combine the outstanding Junior Preferred Stock into a smaller number
of shares or (D) issue any shares of its capital stock in a reclassification of
the Junior Preferred Stock (including any such reclassification in connection
with a consolidation or merger in which the Company is the continuing or
surviving corporation), except as otherwise provided in this Section 11(a) and
Section 7(e) hereof, the Purchase Price in effect at the time of the record date
for such dividend or of the effective date of such subdivision, combination or
reclassification, and the number and kind of shares of Junior Preferred Stock or
capital stock, as the case may be, issuable on such date, shall be
proportionately adjusted so that the holder of any Right exercised after such
time shall be entitled to receive upon payment of the Purchase Price then in
effect the aggregate number and kind of shares of capital stock which, if such
Right had been exercised immediately prior to such date and at a time when the
Junior Preferred Stock (or Common Stock and/or other securities) transfer books
of the Company were open, he would have owned upon such exercise and been
entitled to receive by virtue of such dividend, subdivision, combination or
reclassification. If an event occurs which would require an adjustment under
both this Section 11(a)(i) and Section 11(a)(ii), the adjustment provided for in
this Section 11(a)(i) shall be in addition to, and shall be made prior to, any
adjustment required pursuant to Section 11(a)(ii).
(ii) Subject to Section 23 of this Agreement, in the event any Person,
alone or together with its Affiliates and Associates, becomes an Acquiring
Person (a "Section 11(a)(ii) Event"), then, prior to the later of (x) the date
on which the Company's rights of redemption pursuant to Section 22(a) expire, or
(y) five (5) days after the date of the first occurrence of a Section 11(a)(ii)
Event, proper provision shall be made so that each holder of a Right, except as
provided in Section 7(e) hereof, shall thereafter have a right to receive, upon
exercise thereof at the then current Purchase Price for the number of one
one-thousandths of a share of Junior Preferred Stock for which such Right is
then exercisable in accordance with the terms of this Agreement, in lieu of
shares of Junior Preferred Stock, such number of shares of the Common Stock of
the Company as shall equal the result obtained by (x) multiplying the then
current Purchase Price by the then number of one one-thousandths of a share of
Junior Preferred Stock for which a Right is then exercisable and dividing that
product by (y) fifty percent (50%) of the Current Market Price per share of the
Common Stock of the Company (determined pursuant to Section 11(d)) on the date
of the occurrence of the event listed above in this subparagraph (ii) (such
number of shares are hereinafter referred to as the "Adjustment Shares")
provided that the Purchase Price and the number of Adjustment Shares shall be
fur-
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ther adjusted as provided in this Agreement to reflect any events occurring
after the date of such first occurrence.
(iii) In the event that the number of shares of Common Stock which are
authorized by the Company's Certificate of Incorporation but not outstanding or
reserved for issuance for purposes other than upon exercise of the Rights are
not sufficient to permit the exercise in full of the Rights in accordance with
the foregoing subparagraph (ii), the Company shall (A) determine the excess of
(1) the value of the Adjustment Shares issuable upon the exercise of a Right
(the "Current Value") over (2) the Purchase Price (such excess, the "Spread")
and (B) with respect to each Right, make adequate provision to substitute for
the Adjustment Shares, upon exercise of the Rights and payment of the applicable
Purchase Price, (1) cash, (2) a reduction in the Purchase Price, (3) Common
Stock or other equity securities of the Company (including, without limitation,
shares, or units of shares, of preferred stock which the Board of Directors of
the Company has deemed to have the same value as shares of Common Stock (such
shares of preferred stock, "Common Stock Equivalents")), (4) debt securities of
the Company, (5) other assets or (6) any combination of the foregoing, having an
aggregate value equal to the Current Value, where such aggregate value has been
determined by the Board of Directors of the Company based upon the advice of a
nationally recognized investment banking firm selected by the Board of Directors
of the Company; provided, however, if the Company shall not have made adequate
provision to deliver value pursuant to clause (B) above within thirty (30) days
following the later of (x) the first occurrence of a Section 11(a)(ii) Event and
(y) the date on which the Company's rights of redemption pursuant to Section
22(a) expires (the later of (x) and (y) being referred to herein as the "Section
11(a)(ii) Trigger Date"), then the Company shall be obligated to deliver, upon
the surrender for exercise of a Right and without requiring payment of the
Purchase Price, shares of Common Stock (to the extent available) and then, if
necessary, cash, which shares and/or cash have an aggregate value equal to the
Spread. If the Board of Directors of the Company shall determine in good faith
that it is likely that sufficient additional shares of Common Stock could be
authorized for issuance upon exercise in full of the Rights, the thirty (30) day
period set forth above may be extended to the extent necessary, but not more
than ninety (90) days after the Section 11(a)(ii) Trigger Date, in order that
the Company may seek stockholder approval for the authorization of such
additional shares (such period, as it may be extended, the "Substitution
Period"). To the extent that the Company determines that some action need be
taken pursuant to the first and/or second sentences of this Section 11(a)(iii),
the Company (x) shall provide, subject to Section 7(e) hereof, that such action
shall apply uniformly to all outstanding Rights and (y) may suspend the
exercisability of the Rights until the expiration of the Substitution Period in
order to seek any authorization of additional shares and/or to decide the
appropriate form of distribution to be made pursuant to such first sentence and
to determine the value thereof. In the event of any such suspension, the Company
shall issue a public announcement and shall give simultaneous written notice to
the Rights Agent stating that the exercisability of the Rights has been
temporarily suspended, as well as a public announcement and notice to
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the Rights Agent at such time as the suspension is no longer in effect. For
purposes of this Section 11(a)(iii), the value of the Common Stock shall be the
Current Market Price (as determined pursuant to Section 11(d) hereof) per share
of the Common Stock on the Section 11(a)(ii) Trigger Date and the value of any
Common Stock Equivalent shall be deemed to have the same value as the Common
Stock on such date. The Company shall give the Rights Agent notice of the
selection of any Common Stock Equivalent under this Section 11(a)(iii).
(b) In case the Company shall fix a record date for the issuance of rights,
options or warrants to all holders of Junior Preferred Stock entitling them (for
a period expiring within forty-five (45) calendar days after such record date)
to subscribe for or purchase Junior Preferred Stock (or securities having
substantially the same rights, privileges and preferences as the shares of
Junior Preferred Stock ("Equivalent Junior Preferred Stock") or convertible into
the Junior Preferred Stock or Equivalent Junior Preferred Stock) at a price per
share of the Junior Preferred Stock or Equivalent Junior Preferred Stock (or
having a conversion price per share, if a security convertible into the Junior
Preferred Stock or Equivalent Junior Preferred Stock) less than the Current
Market Price (as defined in Section 11(d) per share of the Junior Preferred
Stock or Equivalent Junior Preferred Stock, as the case may be) on such record
date, the Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in effect immediately prior to such
record date by a fraction, of which the numerator shall be the number of shares
of Junior Preferred Stock outstanding on such record date plus the number of
shares of Junior Preferred Stock or Equivalent Junior Preferred Stock which the
aggregate offering price of the total number of shares of Junior Preferred Stock
or Equivalent Junior Preferred Stock 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 shall be the
number of shares of Junior Preferred Stock outstanding on such record date plus
the number of additional shares of Junior Preferred Stock and/or Equivalent
Junior Preferred Stock to be offered for subscription or purchase (or into which
the convertible securities so to be offered are initially convertible). In case
such subscription price may be paid by delivery of consideration part or all of
which shall be in a form other than cash, the value of such consideration shall
be as determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent.
Shares of Junior Preferred Stock owned by or held for the account of the Company
shall not be deemed outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date is fixed; and
in the event that such rights, options or warrants are not so issued, the
Purchase Price shall be adjusted to be the Purchase Price which would then be in
effect if such record date had not been fixed.
(c) In case the Company shall fix a record date for the making of a
distribution to all holders of Junior Preferred Stock (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving
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corporation) of evidences of indebtedness or assets (other than a regular
periodic cash dividend or a dividend payable in Junior Preferred Stock) or
subscription rights or warrants (excluding those referred to in Section 11(b)),
the Purchase Price to be in effect after such record date shall be determined by
multiplying the Purchase Price in effect immediately prior to such record date
by a fraction, of which the numerator shall be the Current Market Price per
share of Junior Preferred Stock (as defined in Section 11(d)) on such record
date, less the fair market value (as determined in good faith by the Board of
Directors of the Company, whose determination shall be described in a statement
filed with the Rights Agent) of the portion of the assets or evidences of
indebtedness so to be distributed or of such subscription rights or warrants
applicable to one share of Junior Preferred Stock and of which the denominator
shall be such Current Market Price per share of Junior Preferred Stock. Such
adjustments shall be made successively whenever such a record date is fixed; and
in the event that such distribution is not so made, the Purchase Price shall
again be adjusted to be the Purchase Price which would then be in effect if such
record date had not been fixed.
(d) (i) For the purpose of any computation hereunder, other than
computations made pursuant to Section 11(a)(iii), the "Current Market Price" per
share of Common Stock on any date shall be deemed to be the average of the daily
closing prices per share of the Common Stock for the thirty (30) consecutive
Trading Days (as such term is hereinafter defined in this paragraph (d))
immediately prior to but not including such date and for purposes of
computations made pursuant to Section 11(a)(iii) hereof, the "Current Market
Price" per share of Common Stock on any date shall be deemed to be the average
of the daily closing prices per share of the Common Stock for the ten (10)
consecutive Trading Days immediately following but not including such date;
provided, however, in the event that the Current Market Price per share of
Common Stock is determined during the period following the announcement by the
issuer of such Common Stock of (A) a dividend or distribution on such Common
Stock payable in shares of Common Stock or securities convertible into shares of
Common Stock (other than the Rights) or (B) any subdivision, combination or
reclassification of Common Stock, and prior to the expiration of the requisite
30 Trading Day or 10 Trading Day period, as set forth above after the
ex-dividend date for such dividend or distribution or the record date for such
subdivision, combination or reclassification, then, and in each such case, the
Current Market Price shall be appropriately adjusted to take into account
ex-dividend trading. The closing price for each day shall be the last sale
price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the shares of the Common Stock are not listed or admitted to trading on the
New York Stock Exchange, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal national
securities exchange on which the shares of the Common Stock are listed or
admitted to trading or, if the shares of the Common Stock are not listed or
admitted to trading on any national securities exchange, the last quoted price
or, if not so quoted,
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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. Automated
Quotation System ("NASDAQ") or such other system then in use, or, if on any such
date the shares of the Common Stock are not quoted by such organization, the
average of the closing bid and asked prices as furnished by a professional
market maker making a market in the Common Stock selected by the Board of
Directors of the Company. If on any such date no market maker is making a market
in the Common Stock, the fair value of such shares on such date shall be as
determined in good faith by the Board of Directors (which may, in its sole
discretion, rely upon the opinion of an independent investment banking firm
selected by the Board of Directors) whose determination shall be described in a
statement filed with the Rights Agent and shall be conclusive for all purposes.
The term "Trading Day" shall mean a day on which the principal national
securities exchange on which the shares of Common Stock are listed or admitted
to trading is open for the transaction of business or, if the shares of the
Common Stock are not listed or admitted to trading on any national securities
exchange, a Monday, Tuesday, Wednesday, Thursday or Friday on which banking
institutions in the State of New York are not authorized or obligated by law or
executive order to close. If the Common Stock is not publicly held or not so
listed or traded, "Current Market Price" per share shall mean the fair value per
share as determined in good faith by the Board of Directors (which may, in its
sole discretion, rely upon the opinion of an independent investment banking firm
selected by the Board of Directors) whose determination shall be described in a
statement filed with the Rights Agent and shall be conclusive for all purposes.
(ii) For the purpose of any computation hereunder, the Current Market Price
per share of Junior Preferred Stock shall be determined in the same manner as
set forth above for the Common Stock in clause (i) of this Section 11(d) (other
than the last sentence thereof). If the Current Market Price per share of Junior
Preferred Stock cannot be determined in the manner provided above or if the
Junior Preferred Stock is not publicly held or listed or traded in any manner
described in clause (i) of this Section 11(d), the Current Market Price per
share of Junior Preferred Stock shall be conclusively deemed to be an amount
equal to one thousand (1,000) (as such number may be appropriately adjusted for
such events as stock splits, stock dividends and recapitalizations with respect
to the Common Stock occurring after the date of this Agreement) multiplied by
the Current Market Price per share of the Common Stock. If neither the Common
Stock nor the Junior Preferred Stock is publicly held or so listed or traded,
Current Market Price per share of the Junior Preferred Stock shall mean the fair
value per share as determined in good faith by the Board of Directors of the
Company, whose determination shall be described in a statement filed with the
Rights Agent and shall be conclusive for all purposes. For all purposes of this
Agreement, the Current Market Price of one one-thousandth of a share of Junior
Preferred Stock shall be equal to the Current Market Price of one share of
Junior Preferred Stock divided by one thousand (1,000).
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(e) Anything herein to the contrary notwithstanding, no adjustment in the
Purchase Price shall be required unless such adjustment would require an
increase or decrease of at least one percent (1%) in such price; provided,
however, any adjustments which by reason of this Section 11(e) are not required
to be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made to the nearest
cent, the nearest ten-thousandth of a share of Common Stock or the nearest
one-millionth of a share of Junior Preferred Stock, as the case may be.
Notwithstanding the first sentence of this Section 11(e), any adjustment
required by this Section 11 shall be made no later than the earlier of (i) three
years from the date of the transaction which mandates such adjustment or (ii)
the Expiration Date.
(f) If as a result of an adjustment made pursuant to Section 11(a), the
holder of any Right thereafter exercised shall become entitled to receive any
shares of capital stock other than shares of Junior Preferred Stock, thereafter
the number of such other shares so receivable upon exercise of any Right and the
Purchase Price thereof shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the shares of Junior Preferred Stock contained in Sections 11(a)
through (q), inclusive, and the provisions of Sections 7, 9, 10 and 13 with
respect to the Junior Preferred Stock shall apply on like terms to any such
other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of one one-thousandths of a
share of Junior Preferred Stock purchasable from time to time hereunder upon
exercise of the Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as provided in
Section 11(i), upon each adjustment of the Purchase Price as a result of the
calculations made in Sections 11(b) and (c), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of shares (calculated to
the nearest one-millionth) obtained by (i) multiplying (x) the number of shares
covered by a Right immediately prior to this adjustment by (y) the Purchase
Price in effect immediately prior to such adjustment of the Purchase Price and
(ii) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any adjustment of the
Purchase Price to adjust the number of Rights, in substitution for any
adjustment in the number of shares of Junior Preferred Stock purchasable upon
the exercise of a Right. Each of the Rights outstanding after such adjustment of
the number of Rights shall be exercisable for the number of shares of Junior
Preferred Stock for which a Right was exercisable immediately
-23-
prior to such adjustment. Each Right held of record prior to such adjustment of
the number of Rights shall become that number of Rights (calculated to the
nearest ten-thousandth) obtained by dividing the Purchase Price in effect
immediately prior to adjustment of the Purchase Price by the Purchase Price in
effect immediately after the adjustment of the Purchase Price. The Company shall
make a public announcement and shall give simultaneous written notice to the
Rights Agent 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 is adjusted or any day thereafter, but, if the Right
Certificates have been issued, shall be at least ten (10) days later than the
date of the public announcement. If Right Certificates have been issued, upon
each adjustment of the number of Rights pursuant to this Section 11(i), the
Company shall, as promptly as practicable, cause to be distributed to holders of
Right Certificates on such record date Right Certificates evidencing, subject to
Section 13, the additional Rights to which such holders shall be entitled as a
result of such adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment. Right Certificates so to be distributed shall be issued, executed
and countersigned in the manner provided for herein (and may bear, at the option
of the Company, the adjusted Purchase Price) and shall be registered in the
names of the holders of record of Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase Price or the
number of shares of Junior Preferred Stock issuable upon the exercise of the
Rights, the Right Certificates theretofore and thereafter issued may continue to
express the Purchase Price per share and the number of shares which were
expressed in the initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an adjustment reducing the
Purchase Price below one one-thousandth of the then stated value, if any, of a
share of Junior Preferred Stock issuable upon exercise of the Rights, the
Company shall take any corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and legally issue
fully paid and nonassessable such number of one one-thousandths of a share of
such Junior Preferred Stock at such adjusted Purchase Price.
(l) In any case in which this Section 11 shall require that an adjustment
in the Purchase Price be made effective as of a record date for a specified
event, the Company may elect to defer until the occurrence of such event the
issuance to the holder of any Right exercised after such record date the shares
of Junior Preferred Stock and other capital stock or securities of the Company,
if any, issuable
-24-
upon such exercise over and above the shares of Junior Preferred Stock and other
capital stock or securities of the Company, if any, issuable upon such exercise
on the basis of the Purchase Price in effect prior to such adjustment; provided,
however, the Company shall deliver to such holder a due xxxx or other
appropriate instrument evidencing such holder's right to receive such additional
shares upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that the Board of Directors of the Company shall determine to be
advisable in order that any consolidation or subdivision of shares of Junior
Preferred Stock, issuance wholly for cash of any shares of Junior Preferred
Stock at less than the Current Market Price, issuance wholly for cash of the
Junior Preferred Stock or securities which by their terms are convertible into
or exchangeable for Junior Preferred Stock, stock dividends or issuance of
rights, options or warrants referred to hereinabove in this Section 11 hereafter
made by the Company to holders of its Junior Preferred Stock shall not be
taxable to such stockholders.
(n) The Company covenants and agrees that, after the Distribution Date, it
will not, except as permitted by Sections 22, 23 and 26 hereof, take (nor will
it permit any of its Subsidiaries to take) any action if at the time such action
is taken it is reasonably foreseeable that such action will diminish
substantially or otherwise eliminate the benefits intended to be afforded by the
Rights.
(o) The Company covenants and agrees that it shall not, at any time after
the Distribution Date, (i) consolidate with any other Person (other than a
Subsidiary of the Company in a transaction which complies with Section 11(n)),
(ii) merge with or into any other Person (other than a Subsidiary of the Company
in a transaction which complies with Section 11(n)) or (iii) sell or transfer
(or permit any of its Subsidiaries to sell or transfer), in one or more
transactions, assets or earning power aggregating more than fifty percent (50%)
of the assets or earning power of the Company and its Subsidiaries (taken as a
whole) to any other Person or Persons (other than the Company and/or any of its
Subsidiaries in one or more transactions each of which complies with Section
11(n)) if at the time of or immediately after such consolidation, merger or sale
there are any rights, warrants or other instruments or securities outstanding or
agreements in effect which would substantially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights.
(p) Anything in this Agreement to the contrary notwithstanding, in the
event that the Company shall at any time after the Record Date and prior to the
Distribution Date (i) declare a dividend on the outstanding shares of Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding shares
of Common Stock or (iii) combine the outstanding shares of Common Stock into a
smaller number of shares, the number of Rights associated with each share of
Common Stock then outstanding, or issued or delivered there-
-25-
after but prior to the Distribution Date, shall be proportionately adjusted so
that the number of Rights thereafter associated with each share of Common Stock
following any such event shall equal the result obtained by multiplying the
number of Rights associated with each share of Common Stock immediately prior to
such event by a fraction, the numerator of which shall be the total number of
shares of Common Stock outstanding immediately prior to the occurrence of the
event and the denominator of which shall be the total number of shares of Common
Stock outstanding immediately following the occurrence of such event.
(q) Notwithstanding anything in this Agreement to the contrary, prior to
the Distribution Date, the Company may, in lieu of making any adjustment to the
Purchase Price, the number of shares of Junior Preferred Stock eligible for
purchase on exercise of each Right or the number of Rights outstanding, which
adjustment would otherwise be required by Section 11(a)(i), 11(b), 11(c), 11(h)
or 11(i), make such other equitable adjustment or adjustments thereto as the
Board of Directors (whose determination shall be conclusive) deems appropriate
in the circumstances and not inconsistent with the objectives of the Board of
Directors in adopting this Agreement and such Sections.
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Section 11, the Company shall (a)
promptly prepare a certificate setting forth such adjustment, and a brief
statement of the calculations and facts accounting for such adjustment and the
adjusted Purchase Price, (b) promptly file with the Rights Agent and with each
transfer agent for the Junior Preferred Stock and the Common Stock a copy of
such certificate and (c) mail a brief summary thereof to each holder of a Right
Certificate in accordance with Section 25. The Rights Agent shall be fully
protected in relying on any such certificate and on any adjustment therein
contained and shall have no duty with respect to and shall not be deemed to have
knowledge of any adjustment unless and until it shall have received such a
certificate.
Section 13. Fractional Rights and Fractional Shares. (a) The Company shall
not be required to issue fractions of Rights or to distribute Right Certificates
which evidence fractional Rights. In lieu of such fractional Rights, the Company
shall 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 shall
be the closing price of the Rights for the Trading Day immediately prior to the
date on which such fractional Rights would have been otherwise issuable. The
closing price for any day shall be the last sale price, regular way, or, in case
no such sale takes place on such day, the average of the closing bid and asked
prices, regular way, in either case as reported in the principal consolidated
trans-
-26-
action reporting system with respect to securities listed or admitted to trading
on the New York Stock Exchange or, if the Rights are not listed or admitted to
trading on the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to securities listed on
the principal national securities exchange on which the Rights are listed or
admitted to trading or, if the Rights are not listed or admitted to trading on
any national securities exchange, the last quoted price or, if not so quoted,
the average of the high bid and low asked prices in the over-the-counter market,
as reported by NASDAQ or such other system then in use, or, if on any such date
the Rights are not quoted by any such organization, the average of the closing
bid and asked prices as furnished by a professional market maker making a market
in the Rights selected by the Board of Directors of the Company. If on any such
date no such market maker is making a market in the Rights, the fair value of
the Rights on such date as determined in good faith by the Board of Directors of
the Company shall be used.
(b) The Company shall not be required to issue fractions of shares of
Junior Preferred Stock (other than fractions which are integral multiples of one
one-thousandth of a share of Junior Preferred Stock) upon exercise of the Rights
or to distribute certificates which evidence fractional shares (other than
fractions which are integral multiples of one one-thousandth of a share of
Junior Preferred Stock). In lieu of fractional shares that are not integral
multiples of one one-thousandth of a share of Junior Preferred Stock, the
Company may pay to the registered holders of Right Certificates at the time the
Rights evidenced thereby are exercised or exchanged as herein provided an amount
in cash equal to the same fraction of the current market value of one
one-thousandth of a share of Junior Preferred Stock. For purposes of this
Section 13(b), the current market value of one one-thousandth of a share of
Junior Preferred Stock shall be one one-thousandth of the closing price of a
share of Junior Preferred Stock (as determined pursuant to Section 11(d)(ii))
for the Trading Day immediately prior to the date of such exercise.
(c) Following the occurrence of a Triggering Event the Company shall not be
required to issue fractions of shares of Common Stock upon exercise of the
Rights or to distribute certificates which evidence fractional shares of Common
Stock. In lieu of fractional shares of Common Stock, the Company may pay to the
registered holders of Right Certificates at the time such Rights are exercised
as herein provided an amount in cash equal to the same fraction of the current
market value of one (1) share of Common Stock. For purposes of this Section
13(c), the current market value of one share of Common Stock shall be the
closing price of one share of Common Stock (as determined pursuant to Section
11(d)(i) hereof) for the Trading Day immediately prior to the date of such
exercise.
(d) 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 or exchange of a Right, except as otherwise permitted by this Section
13.
(e) The Rights Agent shall have no duty or obligation with respect to this
Section 13 and Section 23(e) hereof unless and until it has received specific
instructions (and suf-
-27-
ficient cash, if required) from the Company with respect to its duties and
obligations under such Sections.
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 Distribution Date, the registered holders of the
Common Stock); and any registered holder of any Right Certificate (or, prior to
the Distribution Date, of the Common Stock), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Stock), may, on his own behalf and for his own
benefit, enforce, and may institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect of, his right to
exercise the Rights evidenced by such Right Certificate in the manner provided
in such Right Certificate and in this Agreement. Without limiting the foregoing
or any remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and will be entitled to specific performance of
the obligations hereunder and injunctive relief against actual or threatened
violations of the obligations hereunder of any Person subject to this Agreement.
Section 15. Agreement of Right Holders. Every holder of a Right by
accepting the same consents and agrees with the Company and the Rights Agent and
with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be transferable
only in connection with the transfer of the Common Stock;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered
at the office of the Rights Agent designated for such purpose, duly
endorsed or accompanied by a proper instrument of transfer and with the
appropriate forms and certificates fully executed;
(c) subject to Section 6 and Section 7(f) hereof, the Company and the
Rights Agent may deem and treat the Person in whose name the Right
Certificate (or, prior to the Distribution Date, the associated Common
Stock certificate) is registered as the absolute owner thereof and of the
Rights evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the associated Common Stock
certificate made by anyone other than the Company or the Rights Agent) for
all purposes whatsoever, and neither the Company nor the Rights Agent shall
be required to be affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any
holder of a Right or other Person as a result of its inability to perform
any of its obligations under this
-28-
Agreement by reason of any preliminary or permanent injunction or other
order, decree, judgment or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission, or any statute, rule, regulation or executive order promulgated
or enacted by any governmental authority, prohibiting or otherwise
restraining performance of such obligation; provided, however, the Company
must use its best efforts to have any such order, decree, judgment or
ruling lifted or otherwise overturned as soon as possible.
Section 16. Right Certificate Holder Not Deemed a Stockholder. No holder,
as such, of any Right Certificate shall be entitled to vote, receive dividends
or be deemed for any purpose the holder of the number of shares of Junior
Preferred Stock or any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby, nor shall anything
contained herein or in any Right Certificate be construed to confer upon the
holder of any Right Certificate, as such, any of the rights of a stockholder of
the Company or any right to vote for the election of directors or upon any
matter submitted to stockholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings or other
actions affecting stockholders (except as provided in Section 24), or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by such Right Certificate shall have been exercised in accordance with
the provisions hereof.
Section 17. Concerning the Rights Agent. The Company agrees to pay to the
Rights Agent such compensation as shall be agreed to in writing between the
Company and the Rights Agent for all services rendered by it hereunder and, from
time to time, on demand of the Rights Agent, its reasonable expenses and counsel
fees and other disbursements incurred in the preparation, execution, delivery,
amendment and administration of this Agreement and the exercise and performance
of its duties hereunder. The Company also agrees to indemnify the Rights Agent
for, and to hold it harmless against, any loss, liability, damage, judgment,
fine, penalty, claim, demand, settlement, cost or expense (including the
reasonable fees and expenses of counsel), incurred without gross negligence, bad
faith or willful misconduct on the part of the Rights Agent (each as may be
finally determined by a court of competent jurisdiction) for any action taken,
suffered or omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the costs and expenses of defending
against any claim of liability on the premises. Anything to the contrary
notwithstanding, in no event shall the Rights Agent be liable for special,
punitive, indirect, consequential or incidental loss or damage of any kind
whatsoever (including, but not limited to, lost profits), even if the Rights
Agent has been advised of the likelihood of such loss or damage. The indemnity
provided herein shall survive the termination of this Agreement and the
termination and the expiration of the Rights. The costs and expenses incurred in
enforcing this right of indemnification shall be paid by the Company. Any
liability of the Rights Agent under this Rights Agreement will be limited to the
amount of fees paid by the Company to the
-29-
Rights Agent. The provisions of this Section 17 shall survive the expiration of
the Rights and the termination of this Agreement. Notwithstanding anything in
this Agreement to the contrary, in no event shall the Rights Agent be liable for
special, indirect or consequential loss or damage of any kind whatsoever
(including but not limited to lost profits), even if the Rights Agent has been
advised of the likelihood of the loss or damage and regardless of the form of
the action.
The Rights Agent shall be authorized and protected and shall incur no
liability for or in respect of any action taken, suffered or omitted by it in
connection with its acceptance and administration of this Agreement in reliance
upon any Right Certificate or certificate for Common Stock or for other
securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
instruction, adjustment notice, certificate, statement, or other paper or
document believed by it to be genuine and to be signed, executed and, where
necessary, verified or acknowledged, by the proper Person or Persons.
In addition to the foregoing, the Rights Agent shall be protected and shall
incur no liability for, or in respect of, any action taken, suffered or omitted
by it in connection with its administration of this Agreement in reliance upon
(i) the execution of the certification concerning beneficial ownership appended
to the Form of Assignment and the Form of Election to Purchase included as part
of Exhibit B hereto (the "Certification"), unless the Rights Agent shall have
actual knowledge that, as executed, the Certification is untrue or (ii) the
non-execution or failure to complete the Certification including, without
limitation, any refusal to honor any otherwise permissible assignment or
election by reason of such non-execution or failure.
Section 18. Merger or Consolidation or Change of Name of Rights Agent. Any
Person into which the Rights Agent or any successor Rights Agent may be merged
or with which it may be consolidated, or any Person resulting from any merger or
consolidation to which the Rights Agent or any successor Rights Agent shall be a
party, or any Person succeeding to all or substantially all the corporate trust
business of the Rights Agent or any successor Rights Agent, shall be the
successor to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
provided that such Person would be eligible for appointment as a successor
Rights Agent under the provisions of Section 20. In case at the time such
successor Rights Agent shall succeed to the agency created by this Agreement any
of the Right Certificates shall have been countersigned but not delivered, any
such successor Rights Agent may adopt the countersignature of the predecessor so
countersigned; and in case at that time any of the Right Certificates shall not
have been countersigned, any successor Rights Agent may countersign such Right
Certificates either in the name of the predecessor Rights Agent or in the name
of
-30-
the successor Rights Agent; and in all such cases such Right Certificates shall
have the full force provided in the Right Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall be changed and at
such time any of the Right Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the countersignature under its prior name
and deliver Right Certificates so countersigned; and in case at that time any of
the Right Certificates shall not have been countersigned, the Rights Agent may
countersign such Right Certificates either in its prior name or in its changed
name; and in all such cases such Right Certificates shall have the full force
provided in the Right Certificates and in this Agreement.
Section 19. Duties of Rights Agent. The Rights Agent undertakes only the
duties and obligations expressly imposed by this Agreement, and no implied
duties or obligations shall be read into this Agreement against the Rights
Agent, upon the following terms and conditions, by all of which the Company and
the holders of Right Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel of its selection (who
may be legal counsel for the Company) and the advice or opinion of such counsel
shall be full and complete authorization and protection to the Rights Agent as
to any action taken, suffered or omitted by it in accordance with such advice or
opinion.
(b) Whenever in the performance of its duties under this Agreement the
Rights Agent shall deem it necessary or desirable that any fact or matter
be proved or established by the Company prior to taking, suffering or
omitting to take any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically prescribed) may be
deemed to be conclusively proved and established by a certificate signed by
any one of the Chairman of the Board, the President, any Vice President,
the Treasurer or the Secretary of the Company and delivered to the Rights
Agent; and such certificate shall be full authorization to the Rights Agent
for any action taken, suffered or omitted by it under the provisions of
this Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its own gross
negligence, bad faith or willful misconduct (and as may be finally
determined by a court of competent jurisdiction); provided, however, the
Rights Agent shall not be liable for any indirect, special, consequential
or punitive damages. The issuance or non-issuance of a Right Certificate or
Junior Preferred Stock or other security issued in lieu of Junior Preferred
Stock in accordance with instructions given to the Rights Agent by the
Company pursuant to Section 19(k) hereof or in accordance with the terms
hereof shall not constitute gross negligence, bad faith or willful
misconduct.
-31-
(d) The Rights Agent shall not be liable for or by reason of any of
the statements of fact or recitals contained in this Agreement or in the
Right Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be
deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in respect
of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the
validity or execution of any Right Certificate (except its countersignature
thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Agreement or in any Right
Certificate; nor shall it be responsible for any adjustment required under
the provisions of Section 11 or responsible for the manner, method or
amount of any such adjustment or the ascertaining of the existence of facts
that would require any such adjustment (except with respect to the exercise
of Rights evidenced by Right Certificates after actual notice of any such
adjustment); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any
shares of Junior Preferred Stock or Common Stock to be issued pursuant to
this Agreement or any Right Certificate or as to whether any shares of
Junior Preferred Stock or Common Stock will, when issued, be validly
authorized and issued, fully paid and nonassessable, nor shall the Rights
Agent be responsible for the legality of the terms hereof in its capacity
as an administrative agent.
(f) The 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 and
certificates delivered pursuant to any provision hereof from any one of the
Chairman of the Board, the President, any Vice President, the Secretary or
the Treasurer of the Company, and is authorized to apply to such officers
for advice or instructions in connection with its duties, and it shall not
be liable for any action taken, suffered or omitted
-32-
to be taken by it in accordance with instructions of any such officer. An
application by the Rights Agent for written instructions from the Company
may, at the option of the Rights Agent, set forth in writing any action
proposed to be taken, suffered or omitted by the Rights Agent with respect
to its duties and obligations under this Agreement and the date on and/or
after which such action shall be taken, or such omission shall be effective
and the Rights Agent shall not be liable for any action taken, suffered or
omitted in accordance with a proposal included in any such application on
or after the date specified therein (which date shall not be less than
three Business Days after the Company receives such application) without
the consent of the Company unless prior to taking, suffering or omitting
such action, the Rights Agent has received written instructions in response
to such application specifying the actions to be taken, suffered or
omitted.
(h) The Rights Agent and any shareholder, affiliate, director, officer
or employee of the Rights Agent may buy, sell or deal in any of the Rights
or other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or
lend money to the Company or otherwise act as fully and freely as though it
were not Rights Agent under this Agreement. Nothing herein shall preclude
the Rights Agent from acting in any other capacity for the Company or for
any other 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 by itself
or by or through its attorneys or agents, and the Rights Agent shall not be
answerable or accountable for any act, default, neglect or misconduct of
any such attorneys or agents or for any loss to the Company or any other
person resulting from any such act, default, neglect or misconduct;
provided, however, reasonable care was exercised in the selection thereof.
(j) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder or in the exercise of its
rights if it believes that repayment of such funds or adequate
indemnification against such risk or liability is not reasonably assured to
it.
(k) If, with respect to any Right Certificate surrendered to the
Rights Agent for exercise or transfer, the 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, the Rights
Agent shall not take any further action with respect to such requested
exercise or transfer without first consulting the Company. The Company
shall give the Rights Agent prompt written instructions as to the action to
be taken regarding the Right Certificate involved. The Rights Agent shall
not be liable for acting in accordance with such instructions.
(l) In addition to the foregoing, the Rights Agent shall be protected
and shall incur no liability for, or in respect of, any action taken or
omitted by it in connection with its administration of this Agreement if
such acts or omissions are in reliance upon (i) the proper execution of the
certification concerning beneficial ownership appended to the form of
assignment and the form of election to purchase attached hereto
-33-
unless the Rights Agent shall have actual knowledge that, as executed, such
certification is untrue, or (ii) the non-execution of such certification
including, without limitation, any refusal to honor any otherwise
permissible assignment or election by reason of such non-execution.
(m) The Company agrees to give the Rights Agent prompt written notice
of any event of ownership of which the Company is aware and which would
prohibit the exercise or transfer of the Right Certificates.
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 thirty (30) days' notice in writing mailed to the Company
and to each transfer agent of the Junior Preferred Stock and the Common
Stock by registered or certified mail, and, at the Company's expense, to
the holders of the Right Certificates by first-class mail. The Company may
remove the Rights Agent or any successor Rights Agent upon thirty (30)
days' notice in writing, mailed to the Rights Agent or successor Rights
Agent, as the case may be, and to each transfer agent of the Junior
Preferred Stock and the Common Stock by registered or certified mail, and
to the holders of the Right Certificates by first-class mail. If the Rights
Agent shall resign or be removed or shall otherwise become incapable of
acting, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of thirty (30)
days after giving notice of such removal or after it has been notified in
writing of such resignation or incapacity by the resigning or incapacitated
Rights Agent or by the holder of a Right Certificate (who shall, with such
notice, submit his Right Certificate for inspection by the Company), then
the Company shall become the temporary Rights Agent and the registered
holder of any Right Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any successor
Rights Agent, whether appointed by the Company or by such a court, shall be
(i) a Person organized and doing business under the laws of the United
States or of the State of New York (or of any other state of the United
States so long as such Person is authorized to do business as a banking or
trust institution in the State of New York), in good standing, having an
office in the State of New York, which is subject to supervision or
examination by federal or state authority or which has at the time of its
appointment as Rights Agent a combined capital and surplus of at least $25
million or (ii) an affiliate of such Person. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties
and responsibilities as if it had been originally named as Rights Agent
without further act or deed; but the predecessor Rights Agent shall deliver
and transfer to the successor Rights Agent any property at the time held by
it hereunder, and execute and deliver any further assurance, conveyance,
act or deed necessary for the purpose. Not later than the effective date of
any such appointment the Company shall file notice thereof in writing with
the predecessor Rights
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Agent and each transfer agent of the Junior Preferred Stock and the Common
Stock, and mail a notice thereof in writing to the registered holders of
the Right Certificates. Failure to give any notice provided for in this
Section 20, however, or any defect therein, shall not affect the legality
or validity of the resignation or removal of the Rights Agent or the
appointment of the successor Rights Agent, as the case may be.
Section 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 and the number or kind or class of shares or other securities
or property purchasable under the Right Certificates made in accordance with the
provisions of this Agreement. In addition, in connection with the issuance or
sale of shares of Common Stock following the Distribution Date and prior to the
redemption or expiration of the Rights, the Company (a) shall, with respect to
shares of Common Stock so issued or sold pursuant to the exercise of stock
options or under any employee plan or arrangement, or upon the exercise,
conversion or exchange of securities hereinafter issued by the Company, and (b)
may, in any other case, if deemed necessary or appropriate by the Board of
Directors of the Company, issue Right Certificates representing the appropriate
number of Rights in connection with such issuance or sale; provided, however,
(i) no such Right Certificate shall be issued if, and to the extent that, the
Company shall be advised by counsel that such issuance would create a
significant risk of material adverse tax consequences to the Company or the
Person to whom such Right Certificate would be issued and (ii) no such Right
Certificate shall be issued if, and to the extent that, appropriate adjustment
shall otherwise have been made in lieu of the issuance thereof.
Section 22. Redemption and Termination. (a) The Board of Directors of the
Company may, at its option, at any time prior to the earlier of (x) the close of
business on the tenth calendar day following the Shares Acquisition Date (or if
the Shares Acquisition Date shall have occurred prior to the Record Date, the
close of business on the tenth day following the Record Date) or (y) the close
of business on the Final Expiration Date, redeem all but not less than all of
the then outstanding Rights at a redemption price of $.001 per Right as
appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof (such redemption price being
hereinafter referred to as the "Redemption Price"), and the Company may, at its
option, pay the Redemption Price either, in whole or in part, in shares of its
Common Stock (valued at their Current Market Price as defined in Section
11(d)(i) on the date of the redemption), other securities, cash or other assets.
Notwithstanding anything contained in this Agreement to the contrary, the Rights
shall not be exercisable after the first occurrence of a Section 11(a)(ii) Event
until such time as the Company's right of redemption hereunder has expired.
-35-
(b) In deciding whether or not to exercise the Company's right of
redemption hereunder, the Board of Directors of the Company shall act in good
faith, in a manner they reasonably believe to be in the best interests of the
Company and with such care, including reasonable inquiry, skill and diligence,
as a person of ordinary prudence would use under similar circumstances, and they
may consider the long-term and short-term effects of any action upon employees,
customers and creditors of the Company and upon communities in which offices or
other establishments of the Company are located, and all other pertinent
factors.
(c) 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 shall be to receive the Redemption
Price for each Right held. Within ten (10) days after the action of the Board of
Directors ordering the redemption of the Rights, the Company shall give notice
of such redemption to the holders of the then outstanding Rights by mailing such
notice to the Rights Agent and to all such holders at their last addresses as
they appear upon the registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the transfer agent for the Common
Stock. Any notice which is mailed in the manner herein provided shall be deemed
given, whether or not the holder receives the notice. Each such notice of
redemption will state the method by which the payment of the Redemption Price
will be made. Neither the Company nor any of its Affiliates or Associates may
redeem, acquire or purchase for value any Rights at any time in any manner other
than that specifically set forth in this Section 22, and other than in
connection with the repurchase of Common Stock prior to the Distribution Date.
Section 23. Exchange. (a) The Board of Directors of the Company may, at its
option, from time to time on or after a Section 11(a)(ii) Event, exchange all or
part of the then outstanding and exercisable Rights (which shall not include
Rights that have become void pursuant to the provisions of Section 7(e) hereof)
for shares of Common Stock at an exchange ratio of one share of Common Stock per
Right appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date of this Agreement (such exchange
ratio being hereinafter referred to as the "Exchange Ratio").
(b) Immediately upon the action of the Board of Directors of the Company
ordering the exchange of any Rights pursuant to Section 23(a) and without any
further action and without any notice, the right to exercise such Rights shall
terminate and the only right thereafter of a holder of such Rights shall be to
receive that number of shares of Common Stock equal to the number of such Rights
held by such holder multiplied by the Exchange Ratio. Promptly after the action
of the Board of Directors ordering an exchange of the Rights, the Company shall
give notice of any such exchange to the Rights Agent and the holders of the then
outstanding Rights by mailing such notice to all such holders at each holder's
last ad-
-36-
dress as it appears upon the registry books of the Rights Agent; provided,
however, the failure to give, or any defect in, such notice shall not affect the
validity of such exchange. Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives the notice.
Each such notice of exchange will state the method by which the exchange of the
shares of Common Stock for Rights will be effected and, in the event of any
partial exchange, the number of Rights which will be exchanged. Any partial
exchange shall be effected pro rata based on the number of Rights (other than
Rights which have become null and void pursuant to the provisions of Section
7(e) hereof) held by each holder of Rights.
(c) In any exchange pursuant to this Section 23, the Company, at its
option, may substitute shares of Junior Preferred Stock (or Equivalent Junior
Preferred Stock, as such term is defined in Section 11(b) hereof) for shares of
Common Stock exchangeable for the Rights, at the initial rate of one
one-thousandth of a share of Junior Preferred Stock (or Equivalent Junior
Preferred Stock) for each share of Common Stock, as appropriately adjusted to
reflect adjustments in the dividend rights of the Junior Preferred Stock
pursuant to the terms thereof.
(d) In the event that there shall not be sufficient shares of Common Stock
or Junior Preferred Stock issued, but not outstanding, or authorized but
unissued, to permit any exchange of Rights as contemplated in accordance with
this Section 23 or that any regulatory actions or approvals are required in
connection therewith, the Company shall take all such action as may be necessary
to authorize additional Common Stock or Junior Preferred Stock for issuance upon
exchange of the Rights.
(e) The Company shall not be required to issue fractional shares of Common
Stock or to distribute certificates which evidence fractional shares of Common
Stock pursuant to this Section 23. In lieu of such fractional shares of Common
Stock, the Company shall pay to the registered holders of the Right Certificates
with regard to which such fractional shares of Common Stock would otherwise be
issuable an amount in cash equal to the same fraction of the current market
value of a whole share of Common Stock. For the purposes of this Section 23(e),
the current market value of a whole share of Common Stock shall be the closing
price of a share of Common Stock (as determined pursuant to the second sentence
of Section 11(d)(i) hereof) for the Trading Day immediately prior to the date of
exchange pursuant to this Section 23.
(f) In any exchange pursuant to this Section 23, the Company, at its
option, may substitute for any share of Common Stock exchangeable for a Right
(i) Common Stock Equivalents, (ii) cash, (iii) debt securities of the Company,
(iv) other assets or (v) any combination of the foregoing, having an aggregate
value which a majority of the Board of Directors of the Company shall have
determined in good faith to be equal to the Current Market Price of
-37-
one share of Common Stock (determined pursuant to Section 11(d) hereof) on the
Trading Day immediately preceding the date of exchange pursuant to this Section
23.
Section 24. Notice of Certain Events. In case the Company shall propose at
any time following the Distribution Date (a) to pay any dividend payable in
stock of any class to the holders of Junior Preferred Stock or to make any other
distribution to the holders of Junior Preferred Stock (other than a regular
periodic cash dividend), (b) to offer to the holders of Junior Preferred Stock
rights or warrants to subscribe for or to purchase any additional shares of
Junior Preferred Stock or shares of stock of any class or any other securities,
rights or options, (c) to effect any reclassification of Junior Preferred Stock
(other than a reclassification involving only the subdivision of outstanding
Junior Preferred Stock), (d) to effect any consolidation or merger into or with
any other Person (other than a Subsidiary of the Company in a transaction which
complies with Section 11(n) hereof) or to effect any sale or other transfer (or
to permit one or more of its Subsidiaries to effect any sale or other transfer),
in one or more transactions, of more than fifty percent (50%) of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to any
other Person or Persons (other than the Company and/or any of its Subsidiaries
in one or more transactions each of which complies with Section 11(n) hereof) or
(e) to effect the liquidation, dissolution or winding up of the Company, then,
in each such case, the Company shall give to the Rights Agent and to each holder
of a Right, in accordance with Section 25, a notice of such proposed action,
which shall specify the record date for the purposes of such stock dividend,
distribution of rights or Rights, or the date on which such reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution or winding up is
to take place and the date of participation therein by the holders of the Junior
Preferred Stock, if any such date is to be fixed, and such notice shall be so
given in the case of any action covered by clause (a) or (b) above at least
twenty (20) days prior to the record date for determining holders of the Junior
Preferred Stock for purposes of such action, and in the case of any such other
action, at least twenty (20) days prior to the date of the taking of such
proposed action or the date of participation therein by the holders of the
Junior Preferred Stock, whichever shall be the earlier.
In case a Section 11(a)(ii) Event shall occur, then, in any such case, the
Company shall as soon as practicable thereafter give to the Rights Agent and to
each holder of a Right, to the extent feasible and in accordance with Section
25, a notice of the occurrence of such event, which shall specify the event and
the consequences of the event to holders of Rights under Section 11(a)(ii) and
all references in the preceding paragraph to Junior Preferred Stock shall be
deemed to thereafter refer to Common Stock and/or other securities, as the case
may be.
Section 25. Notices. Notices or demands authorized by this Agreement to be
given or made by the Rights Agent or by the holder of any Right Certificate to
or on the
-38-
Company shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with the Rights
Agent) as follows:
Atlas Air Worldwide Holdings, Inc.
0000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxx X. Xxxxx, Senior Vice President
and General Counsel
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 shall be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed (until another address is
filed in writing with the Company) as follows:
Computershare Trust Company
00000 Xxxx Xxxxxxx Xxxxxxx, Xxxxx X-0
Xxxxxxxx, Xxxxxxxx 00000
Attention: Trust Department
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company.
Section 26. Supplements and Amendments. Prior to the earlier of the
Distribution Date or the Shares Acquisition Date and subject to the penultimate
sentence of this Section 26, the Company may from time to time supplement or
amend this Agreement without the approval of any holders of Right Certificates.
From and after the earlier of the Distribution Date or the Shares Acquisition
Date, and subject to the penultimate sentence of this Section 26, the Company
may from time to time supplement or amend this Agreement without the approval of
any holders of Right Certificates in order (i) to cure any ambiguity, (ii) to
correct or supplement any provision contained herein which may be defective or
inconsistent with any other provisions herein, (iii) to lengthen the time period
during which the Rights may be redeemed following the Shares Acquisition Date
for up to an additional twenty (20) days beyond the time period set forth in
Section 22(a) or (iv) to change or supplement the provisions hereunder in any
manner which the Company may deem necessary or desirable and which shall not
adversely affect the interests of the holders of Right Certificates (other than
an Acquiring Person or an Affiliate or Associate of an Acquiring Person). The
Company shall provide the Rights Agent with an Incumbency Certificate in
substantially the form attached hereto as Exhibit D (the "Incumbency
Certificate") and shall update it as necessary. Upon the delivery of a
certificate from an authorized officer of the Company which states that the
pro-
-39-
posed supplement or amendment is in compliance with the terms of this Section
26, the Rights Agent shall execute such supplement or amendment unless the
Rights Agent shall have determined in good faith that such supplement or
amendment would adversely affect its interests under this Agreement.
Notwithstanding anything in this Agreement to the contrary, no supplement or
amendment shall be made on or after the Distribution Date which changes the
Redemption Price, the Final Expiration Date, the Purchase Price or the number of
shares of Junior Preferred Stock for which a Right is then exercisable.
Section 27. Successors. All the covenants and provisions of this Agreement
by or for the benefit of the Company or the Rights Agent shall bind and inure to
the benefit of their respective successors and assigns hereunder.
Section 28. Determinations and Actions by the Board of Directors. For all
purposes of this Agreement, any calculation of the number of shares of Voting
Stock outstanding at any particular time, including for purposes of determining
the particular percentage of such outstanding shares of Voting Stock of which
any Person is the Beneficial Owner, shall 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 shall have the exclusive
power and authority to administer this Agreement and to exercise all rights and
powers specifically granted to the Company's Board of Directors, 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 and calculations
deemed necessary or advisable for the administration of this Agreement
(including a determination to redeem or not redeem the Rights or to amend the
Agreement). All such actions, calculations, interpretations and determinations
(including, for the purpose of clause (ii) below, all omissions with respect to
the foregoing) which are done or made by the Board in good faith, shall (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 Company's
Board of Directors to any liability to the holders of the Right Certificates.
The Rights Agent shall always be entitled to assume that the Company's Board of
Directors acted in good faith and shall be fully protected and incur no
liability in reliance thereon.
Section 29. Benefits of This Agreement. Nothing in this Agreement shall be
construed to give to any Person other than the Company, the Rights Agent and the
registered holders of the Right Certificates (and, prior to the Distribution
Date, the Common Stock) any legal or equitable right, remedy or claim under this
Agreement; but this Agreement shall be for the sole and exclusive benefit of the
Company, the Rights Agent and the registered holders of the Right Certificates
(and, prior to the Distribution Date, registered holders of the Common Stock).
-40-
Section 30. Severability. If any term, provision, covenant, or restriction
of this Agreement is held by a court of competent jurisdiction or other
authority to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired or invalidated;
provided, however, notwithstanding anything in this Agreement to the contrary,
if any such term, provision, covenant or restriction is held by such court or
authority to be invalid, void or unenforceable and the Board of Directors of the
Company determines in its good faith judgment that severing the invalid language
from this Agreement would adversely affect the purpose or effect of this
Agreement, the right of redemption set forth in Section 22 hereof shall be
reinstated and shall not expire until the close of business on the tenth day
following the date of such determination by the Board of Directors.
Section 31. Governing Law. This Agreement and each Right Certificate issued
hereunder shall be deemed to be a contract made under the laws of the State of
Delaware and for all purposes shall be governed by and construed in accordance
with the laws of such State applicable to contracts to be made and performed
entirely within such State except that the rights, duties and obligations of the
Rights Agent under this Agreement shall be governed by the laws of the State of
New York.
Section 32. Counterparts. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
Section 33. Descriptive Headings. Descriptive headings of the several
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
-41-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
[SEAL]
ATLAS AIR WORLDWIDE HOLDINGS, INC.
By:
------------------------------------------
Name:
------------------------------------------
Title:
------------------------------------------
COMPUTERSHARE TRUST COMPANY, Rights Agent
By:
------------------------------------------
Name:
------------------------------------------
Title:
------------------------------------------
Attest:
By:
-----------------------------------
Name:
-----------------------------------
Title:
-----------------------------------
Exhibit A
CERTIFICATE OF DESIGNATION,
PREFERENCES AND RIGHTS OF
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
ATLAS AIR WORLDWIDE HOLDINGS, INC.
------------------
Pursuant to Section 151 of the
General Corporation Law of the
State of Delaware
------------------
ATLAS AIR WORLDWIDE HOLDINGS, INC. (the "Corporation"), a corporation
organized and existing under the General Corporation Law of the State of
Delaware does hereby certify that, pursuant to authority conferred upon the
Board of Directors by the Certificate of Incorporation and pursuant to the
provisions of Section 151 of the Delaware General Corporation Law, said Board of
Directors duly adopted the following resolution, which resolution remains in
full force and effect as of June 18, 2001:
RESOLVED, that pursuant to authority conferred upon the Board of Directors
by the Certificate of Incorporation of the Corporation there is hereby created a
series of preferred stock of the Corporation; which series shall have the
following powers, preferences, and relative, participating, optional or other
special rights, and the qualifications, limitations or restrictions thereof, in
addition to those set forth in the Certificate of Incorporation of the
Corporation:
1. Designation and Amount. The series of Preferred Stock established hereby
shall be designated as "Series A Junior Participating Preferred Stock," par
value $1.00, and the authorized number of shares of Series A Junior
Participating Preferred Stock shall be 40,000 shares.
2. Dividends and Distributions. (A) Subject to the rights of the holders of
any shares of any series of Preferred Stock ranking prior and superior to the
shares of Series A Junior Participating Preferred Stock with respect to
dividends, the holders of shares of Series A Junior Participating Preferred
Stock shall be entitled to receive, when, as and if declared by the Board of
Directors out of funds legally available for the purpose, quarterly dividends
payable in cash on the first day of February, May, August and November in each
year
A-1
(each such date being referred to herein as a "Quarterly Dividend Payment
Date"), commencing on the first Quarterly Dividend Payment Date after the first
issuance of a share or fraction of a share of Series A Junior Participating
Preferred Stock, in an amount per share (rounded to the nearest cent) equal to
the greater of (a) $10.00 per share or (b) subject to the provision for
adjustment hereinafter set forth, one thousand (1,000) times the aggregate per
share amount of all cash dividends, and one thousand (1,000) times the aggregate
per share amount (payable in kind) of all non-cash dividends or other
distributions other than a dividend payable in shares of Common Stock or a
subdivision of the outstanding shares of Common Stock (by reclassification or
otherwise), declared on the Common Stock, par value $0.01, of the Corporation
(the "Common Stock") since the immediately preceding Quarterly Dividend Payment
Date, or, with respect to the first Quarterly Dividend Payment Date, since the
first issuance of any share or fraction of a share of Series A Junior
Participating Preferred Stock. In the event the Corporation shall at any time
after June 18, 2001 (the "Rights Dividend Declaration Date") (i) declare any
dividend on Common Stock payable in shares of Common Stock, (ii) subdivide the
outstanding shares of Common Stock, or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such case the amount to
which holders of shares of Series A Junior Participating Preferred Stock were
entitled immediately prior to such event under clause (b) of the preceding
sentence shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on the Series
A Junior Participating Preferred Stock as provided in Paragraph (A) above
immediately after it declares a dividend or distribution on the Common Stock
(other than a dividend payable in shares of Common Stock); provided, however, in
the event no dividend or distribution shall have been declared on the Common
Stock during the period between any Quarterly Dividend Payment Date and the next
subsequent Quarterly Dividend Payment Date, a dividend of $10.00 per share on
the Series A Junior Participating Preferred Stock shall nevertheless be payable
on such subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding shares
of Series A Junior Participating Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares of Series A Junior
Participating Preferred Stock, unless the date of issue of such shares is prior
to the record date for the first Quarterly Dividend Payment Date, in which case
dividends on such shares shall begin to accrue from the date of issue of such
shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a
date after the record date for the determination of holders of shares of Series
A Junior Participating Preferred Stock entitled to receive a quarterly dividend
and before such Quarterly Dividend Payment Date, in either of which events such
dividends shall begin to accrue and be cumulative from such Quarterly Dividend
Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends
paid on the shares of Series A Junior Participat-
A-2
ing Preferred Stock in an amount less than the total amount of such dividends at
the time accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders of shares of
Series A Junior Participating Preferred Stock entitled to receive payment of a
dividend or distribution declared thereon, which record date shall be no more
than thirty (30) days prior to the date fixed for the payment thereof.
3. Voting Rights. The holders of shares of Series A Junior Participating
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Junior Participating Preferred Stock shall entitle
the holder thereof to one thousand (1,000) votes on all matters submitted
to a vote of the stockholders of the Corporation. In the event the
Corporation shall at any time after the Rights Declaration Date (i) declare
any dividend on Common Stock payable in shares of Common Stock, (ii)
subdivide the Common Stock or (iii) combine the outstanding Common Stock
into a smaller number of shares, then in each such case the number of votes
per share to which holders of shares of Series A Junior Participating
Preferred Stock were entitled immediately prior to such event shall be
adjusted by multiplying such number by a fraction the numerator of which is
the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in the Certificate of
Incorporation or by law, the holders of shares of Series A Junior
Participating Preferred Stock and the holders of shares of Common Stock,
shall vote together as one class on all matters submitted to a vote of
stockholders of the Corporation.
(C) (i) If at any time dividends on any Series A Junior Participating
Preferred Stock shall be in arrears in an amount equal to six (6) quarterly
dividends thereon, the occurrence of such contingency shall xxxx the
beginning of a period (herein called a "default period") which shall extend
until such time when all accrued and unpaid dividends for all previous
quarterly dividend periods and for the current quarterly dividend period on
all shares of Series A Junior Participating Preferred Stock then
outstanding shall have been declared and paid or set apart for payment.
During each default period, all holders of Preferred Stock (including
holders of the Series A Junior Participating Preferred Stock) with
dividends in arrears in an amount equal to six (6) quarterly dividends
thereon, voting as a class, irrespective of series, shall have the right to
elect two (2) directors.
(ii) During any default period, such voting right of the holders of
Series A Junior Participating Preferred Stock may be exercised initially at
a special
A-3
meeting called pursuant to subparagraph (iii) of this Section 3(C) or at
any annual meeting of stockholders, and thereafter at annual meetings of
stockholders, provided that neither such voting right nor the right of the
holders of any other series of Preferred Stock, if any, to increase, in
certain cases, the authorized number of directors shall be exercised unless
the holders of ten percent (10%) in number of shares of Preferred Stock
outstanding shall be present in person or by proxy. The absence of a quorum
of the holders of Common Stock shall not affect the exercise by the holders
of Preferred Stock of such voting right. At any meeting at which the
holders of Preferred Stock shall exercise such voting right initially
during an existing default period, they shall have the right, voting as a
class, to elect directors to fill such vacancies, if any, in the Board of
Directors as may then exist up to two (2) directors or, if such right is
exercised at an annual meeting, to elect two (2) directors. If the number
which may be so elected at any special meeting does not amount to the
required number, the holders of the Preferred Stock shall have the right to
make such increase in the number of directors as shall be necessary to
permit the election by them of the required number. After the holders of
the Preferred Stock shall have exercised their right to elect directors in
any default period and during the continuance of such period, the number of
directors shall not be increased or decreased except by vote of the holders
of Preferred Stock as herein provided or pursuant to the rights of any
equity securities ranking senior to or pari passu with the Series A Junior
Participating Preferred Stock.
(iii) Unless the holders of Preferred Stock shall, during an existing
default period, have previously exercised their right to elect directors,
the Board of Directors may order, or any stockholder or stockholders owning
in the aggregate not less than ten percent (10%) of the total number of
shares of Preferred Stock outstanding, irrespective of series, may request,
the calling of a special meeting of the holders of Preferred Stock, which
meeting shall thereupon be called by the President, a Vice-President or the
Secretary of the Corporation. Notice of such meeting and of any annual
meeting at which holders of Preferred Stock are entitled to vote pursuant
to this Paragraph (C)(iii) shall be given to each holder of record of
Preferred Stock by mailing a copy of such notice to him at his last address
as the same appears on the books of the Corporation. Such meeting shall be
called for a time not earlier than twenty (20) days and not later than
sixty (60) days after such order or request or in default of the calling of
such meeting within sixty (60) days after such order or request, such
meeting may be called on similar notice by any stockholder or stockholders
owning in the aggregate not less than ten percent (10%) of the total number
of shares of Preferred Stock outstanding. Notwithstanding the provisions of
this Paragraph (C)(iii), no such special meeting shall be called during the
period within sixty (60) days immediately preceding the date fixed for the
next annual meeting of the stockholders.
(iv) In any default period, the holders of Common Stock, and other
classes of stock of the Corporation if applicable, shall continue to be
entitled to elect
A-4
the whole number of directors until the holders of Preferred Stock shall
have exercised their right to elect two (2) directors voting as a class,
after the exercise of which right (x) the directors so elected by the
holders of Preferred Stock shall continue in office until their successors
shall have been elected by such holders or until the expiration of the
default period and (y) any vacancy in the Board of Directors may (except as
provided in Paragraph (C)(ii) of this Section 3) be filled by vote of a
majority of the remaining directors theretofore elected by the holders of
the class of stock which elected the director whose office shall have
become vacant. References in this Paragraph (C) to directors elected by the
holders of a particular class of stock shall include directors elected by
such directors to fill vacancies as provided in clause (y) of the foregoing
sentence.
(v) Immediately upon the expiration of a default period, (x) the right
of the holders of Preferred Stock as a class to elect directors shall
cease, (y) the term of any directors elected by the holders of Preferred
Stock as a class shall terminate and (z) the number of directors shall be
such number as may be provided for in the certificate of incorporation or
by-laws irrespective of any increase made pursuant to the provisions of
Paragraph (C)(ii) of this Section 3 (such number being subject, however, to
change thereafter in any manner provided by law or in the certificate of
incorporation or by-laws). Any vacancies in the Board of Directors effected
by the provisions of clauses (y) and (z) in the preceding sentence may be
filled by a majority of the remaining directors.
(D) Except as set forth herein, holders of Series A Junior
Participating Preferred Stock shall have no special voting rights and their
consent shall not be required (except to the extent they are entitled to
vote with holders of Common Stock as set forth herein) for taking any
corporate action.
4. Certain Restrictions. (A) Whenever quarterly dividends or other
dividends or distributions payable on the Series A Junior Participating
Preferred Stock as provided in Section 2 are in arrears, thereafter and until
all accrued and unpaid dividends and distributions, whether or not declared, on
shares of Series A Junior Participating Preferred Stock outstanding shall have
been paid in full, the Corporation shall not:
(i) declare or pay dividends on, make any other distributions on, or
redeem or purchase or otherwise acquire for consideration any shares
of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Junior Participating
Preferred Stock;
(ii) declare or pay dividends on or make any other distributions on any
shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Junior
Participating Preferred Stock, ex-
A-5
cept dividends paid ratably on the Series A Junior Participating
Preferred Stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts to which the
holders of all such shares are then entitled;
(iii) redeem, purchase or otherwise acquire for consideration shares of any
stock ranking on a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Junior Participating
Preferred Stock, provided that the Corporation may at any time redeem,
purchase or otherwise acquire shares of any such parity stock in
exchange for shares of any stock of the Corporation ranking junior
(either as to dividends or upon dissolution, liquidation or winding
up) to the Series A Junior Participating Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any shares of Series A
Junior Participating Preferred Stock, or any shares of stock ranking
on a parity with the Series A Junior Participating Preferred Stock,
except in accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all holders
of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other
relative rights and preferences of the respective series and classes,
shall determine in good faith will result in fair and equitable
treatment among the respective series or classes;
(B) The Corporation shall not permit any subsidiary of the Corporation to
purchase or otherwise acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under subparagraph (A) of this
Paragraph 4, purchase or otherwise acquire such shares at such time and in such
manner.
5. Reacquired Shares. Any shares of Series A Junior Participating Preferred
Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and canceled promptly after the acquisition thereof.
All such shares shall upon their cancellation become authorized but unissued
shares of Preferred Stock and may be reissued as part of a new series of
Preferred Stock to be created by resolution or resolutions of the Board of
Directors, subject to the conditions and restrictions on issuance set forth
herein.
6. Liquidation, Dissolution or Winding Up. (A) Upon any liquidation
(voluntary or otherwise), dissolution or winding up of the Corporation, no
distribution shall be made to the holders of shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or winding up) to the
Series A Junior Participating Preferred Stock unless, prior thereto, the holders
of shares of Series A Junior Participating Preferred Stock shall have received
an amount equal to $1,000 per share of Series A Junior Participating Preferred
Stock, plus an amount equal to accrued and unpaid dividends and distributions
thereon, whether or
A-6
not declared, to the date of such payment (the "Series A Liquidation
Preference"). Following the payment of the full amount of the Series A
Liquidation Preference, no additional distributions shall be made to the holders
of shares of Series A Junior Participating Preferred Stock unless, prior
thereto, the holders of shares of Common Stock shall have received an amount per
share (the "Common Adjustment") equal to the quotient obtained by dividing (i)
the Series A Junior Liquidation Preference by (ii) one thousand (1,000) (as
appropriately adjusted as set forth in subparagraph (C) below to reflect such
events as stock splits, stock dividends and recapitalizations with respect to
the Common Stock) (such number in clause (ii), the "Adjustment Number").
Following the payment of the full amount of the Series A Liquidation Preference
and the Common Adjustment in respect of all outstanding shares of Series A
Junior Participating Preferred Stock and Common Stock, respectively, holders of
Series A Junior Participating Preferred Stock and holders of shares of Common
Stock shall receive their ratable and proportionate share of the remaining
assets to be distributed in the ratio of the Adjustment Number to one (1) with
respect to such Preferred Stock and Common Stock, on a per share basis,
respectively.
(B) In the event, however, that there are not sufficient assets available
to permit payment in full of the Series A Liquidation Preference and the
liquidation preferences of all other series of Preferred Stock, if any, which
rank on a parity with the Series A Junior Participating Preferred Stock, then
such remaining assets shall be distributed ratably to the holders of such parity
shares in proportion to their respective liquidation preferences. In the event,
however, that there are not sufficient assets available to permit payment in
full of the Common Adjustment, then such remaining assets shall be distributed
ratably to the holders of Common Stock.
(C) In the event the Corporation shall at any time after the Rights
Dividend Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the Adjustment Number in effect immediately prior to such event
shall be adjusted by multiplying such Adjustment Number by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
7. Consolidation, Merger, etc. In case the Corporation shall enter into any
consolidation, merger, combination or other transaction in which the shares of
Common Stock are exchanged for or changed into other stock or securities, cash
and/or any other property, then in any such case the shares of Series A Junior
Participating Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to one thousand (1,000) times the aggregate amount
of stock, securities, cash and/or any other property (payable in kind), as the
case may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the
A-7
Corporation shall at any time after the Rights Dividend Declaration Date (i)
declare any dividend on Common Stock payable in shares of Common Stock (ii)
subdivide the outstanding Common Stock or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such case the amount set
forth in the preceding sentence with respect to the exchange or change of shares
of Series A Junior Participating Preferred Stock shall be adjusted by
multiplying such amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
8. Redemption. The shares of Series A Junior Participating Preferred Stock
shall not be redeemable.
9. Ranking. The Series A Junior Participating Preferred Stock shall rank
junior to all other series of the Corporation's Preferred Stock as to the
payment of dividends and the distribution of assets, unless the terms of any
such series shall provide otherwise.
10. Amendment. At any time when any shares of Series A Junior Participating
Preferred Stock are outstanding, neither the Certificate of Incorporation of the
Corporation nor this Certificate of Designation shall be amended in any manner
which would materially alter or change the powers, preferences or special rights
of the Series A Junior Participating Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of a majority or more of
the outstanding shares of Series A Junior Participating Preferred Stock, voting
separately as a class.
11. Fractional Shares. Series A Junior Participating Preferred Stock may be
issued in fractions of a share which shall entitle the holder, in proportion to
such holder's fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of Series A Junior Participating Preferred Stock.
A-8
IN WITNESS WHEREOF, we have executed and subscribed this Certificate and do
affirm the foregoing as true under penalties of perjury as of this th day of , .
ATLAS AIR WORLDWIDE HOLDINGS, INC.
By:
--------------------------------------------
[Name]
[Title]
ATTEST:
By:
-----------------------------------
[Name]
[Title]
A-9
EXHIBIT B
[Form of Right Certificate]
Certificate No. R- ________ Rights
NOT EXERCISABLE AFTER JULY 2, 2011 OR EARLIER IF REDEEMED BY THE COMPANY. THE
RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $.001 PER
RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS SUCH TERM IS
DEFINED IN THE RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY
BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHT CERTIFICATE ARE OR
WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN
AFFILIATE OR AN ASSOCIATE OF AN 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.](1)
ATLAS AIR WORLDWIDE HOLDINGS, INC.
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 Rights Agreement dated as
of June 18, 2001 (the "Rights Agreement") between Atlas Air Worldwide Holdings,
Inc., a Delaware corporation (the "Company"), and Computershare Trust Company, a
Colorado corporation, as Rights Agent (the "Rights Agent"), to purchase from the
Company at any time prior to 5:00 P.M. (New York City time) on July 2, 2011 at
the office of the Rights Agent designated for such purpose, or its successors as
Rights Agent, one one-thousandth of a fully paid, non-assessable share of Series
A Junior Participating Preferred Stock, $1.00 par value (the "Junior Preferred
----------
1 The portion of the legend in brackets shall be inserted only if
applicable and shall replace the preceding sentence.
B-1
Stock"), of the Company, at a purchase price of $115 per one one-thousandth of a
share (the "Purchase Price"), upon presentation and surrender of this Right
Certificate with the Form of Election to Purchase and related Certificate duly
executed, along with a signature guarantee and such other and further
documentation as the Rights Agent may reasonably request. The number of Rights
evidenced by this Right Certificate (and the number of shares which may be
purchased upon exercise thereof) set forth above, and the Purchase Price per
share set forth above, are the number and Purchase Price as of June 18, 2001,
based on the Junior Preferred Stock as constituted at such date. The Company
reserves the right to require prior to the occurrence of a Triggering Event (as
such term is defined in the Rights Agreement) that a number of Rights be
exercised so that only whole shares of Junior Preferred Stock will be issued.
Upon the occurrence of a Triggering Event, if the Rights evidenced by this
Right Certificate are beneficially owned by (i) an Acquiring Person or an
Affiliate or Associate of any such Acquiring Person (as such terms are defined
in the Rights Agreement), (ii) a transferee of any such Acquiring Person,
Associate or Affiliate or (iii) under certain circumstances specified in the
Rights Agreement, a transferee of a person who, after such transfer, became an
Acquiring Person or an Affiliate or Associate of an Acquiring Person, such
Rights would become null and void and no holder hereof would 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 and the number and
kind of shares of Junior Preferred Stock (or, in certain circumstances, common
stock and/or other securities) which may be purchased upon the exercise of the
Rights evidenced by this Right Certificate are subject to modification and
adjustment upon the happening of certain events, including Triggering Events.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates, which
limitations of rights include the temporary suspension of the exercisability of
such Rights under the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the above-mentioned office of the
Rights Agent and at the executive offices of the Company.
This Right Certificate, with or without other Right Certificates, upon
surrender at the office of the Rights Agent designated for such purpose, along
with a signature guarantee and such other and further documentation as the
Rights Agent may reasonably request, 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 one one-thousandths
of a share of Junior Preferred Stock as the Rights evidenced by the Right
Certificate or Right Cer-
B-2
tificates surrendered shall have entitled such holder to purchase. If this Right
Certificate shall be exercised in part, the holder shall be entitled to receive
upon surrender hereof, along with a signature guarantee and such other and
further documentation as the Rights Agent may reasonably request, another Right
Certificate or Right Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Certificate may be redeemed by the Company at its option at a redemption
price of $.001 per Right at any time prior to the earlier of the close of
business on (i) the tenth day following the Shares Acquisition Date (as such
time period may be extended pursuant to the Rights Agreement) and (ii) the Final
Expiration Date. In addition, under certain circumstances following the Shares
Acquisition Date, the Rights may be exchanged, in whole or in part, for shares
of common stock or shares of preferred stock of the Company having essentially
the same value or economic rights as such shares. Immediately upon the action of
the Board of Directors of the Company authorizing any such exchange, and without
any further action or any notice, the Rights (other than Rights which are not
subject to such exchange) will terminate and the Rights will only enable holders
to receive the shares issuable upon such exchange.
No fractional shares of Junior Preferred Stock will be issued upon the
exercise of any Right or Rights evidenced hereby (other than fractions which are
integral multiples of one one-thousandth of a share of Junior Preferred Stock),
but in lieu thereof a cash payment will be made, as provided in the Rights
Agreement. The Company, at its election, may require that a number of Rights be
exercised so that only whole shares of Junior Preferred Stock would be issued.
No holder of this Right Certificate shall be entitled to vote or receive
dividends or be deemed for any purpose the holder of shares of Junior Preferred
Stock or of any other securities of the Company which may at any time be
issuable on the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any
of the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give consent to or withhold consent from any corporate
action, or to receive notice of meetings or other actions affecting stockholders
(except as provided in the Rights Agreement), or to receive dividends or
subscription rights, or otherwise, until the Right or Rights evidenced by this
Right Certificate shall have been exercised as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by an authorized signatory of the Rights
Agent.
B-3
WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal. Dated as of __________, ____.
[SEAL]
ATTEST: ATLAS AIR WORLDWIDE HOLDINGS, INC.
By: By:
----------------------------------- -------------------------------
Name: Name:
Title: Title:
Countersigned:
COMPUTERSHARE TRUST COMPANY,
as Rights Agent
By:
-----------------------------------
Name:
Title:
Date:
B-4
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR VALUE RECEIVED ___________________________ hereby sells, assigns and
transfers unto__________________________________________________________________
________________________________________________________________________________
(Please print name and address of transferee)
________________________________________________________________________________
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint ________________ Attorney, to
transfer the within Right Certificate on the books of the within named Company,
with full power of substitution.
Dated: __________, ____
____________________________________________
Signature
B-5
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
Affiliate or Associate of any such Acquiring Person (as such terms are defined
pursuant to 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 Affiliate or
Associate of an Acquiring Person.
Dated: _____________, ____
____________________________________________
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 or enlargement or any change whatsoever.
B-6
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise
Rights evidenced by the Right Certificate.)
To Atlas Air Worldwide Holdings, Inc.:
The undersigned hereby irrevocably elects to exercise ________________
Rights represented by this Right Certificate to purchase the shares of Junior
Preferred Stock issuable upon the exercise of the Rights (or such other
securities of the Company or of any other Person which may be issuable upon the
exercise of the Rights) and requests that certificates for such shares be issued
in the name of:
Please insert social security or
other taxpayer identifying number
________________________________________________________________________________
(Please print name and address)
If such number of Rights shall not be all the Rights evidenced by this
Right Certificate, a new Right Certificate for the balance of such Rights shall
be registered in the name of and delivered to:
Please insert social security or
other taxpayer identifying number
________________________________________________________________________________
(Please print name and address)
________________________________________________________________________________
Dated: ____________, ____
____________________________________________
Signature
B-7
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes that:
(1) the Rights evidenced by this Right Certificate [ ] are [ ] are not
being exercised by or on behalf of a Person who is or was an Acquiring Person or
an Affiliate or Associate of any such Acquiring Person (as such terms are
defined pursuant to 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 became an Acquiring Person or an Affiliate or Associate of
an Acquiring Person.
Dated: ______________, ____
____________________________________________
Signature
________________________________________________________________________________
NOTICE
The signature to the foregoing Election to Purchase and Certificate must
correspond to the name as written upon the face of this Right Certificate in
every particular, without alteration or enlargement or any change whatsoever.
B-8
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE
JUNIOR PREFERRED STOCK
The Board of Directors of Atlas Air Worldwide Holdings, Inc. (the
"Company") has declared a dividend distribution of one Right for each
outstanding share of Common Stock, par value $0.01 (the "Common Stock"), of the
Company. The distribution is payable to holders of record on July 2, 2001 (the
"Record Date"). Each Right entitles the registered holder to purchase from the
Company one one-thousandth of a share of Series A Junior Participating Preferred
Stock, $1.00 par value (the "Junior Preferred Stock"), at a price of $115.00 per
one one-thousandth of a share (the "Purchase Price"), subject to adjustment. The
description and terms of the Rights are set forth in a Rights Agreement (the
"Rights Agreement") between the Company and Computershare Trust Company, as
Rights Agent (the "Rights Agent").
Distribution Date; Transfer of Rights
Until the earlier to occur of (i) ten calendar days following the date (the
"Shares Acquisition Date") of public announcement that a person or group of
affiliated or associated persons, subject to certain exceptions (an "Acquiring
Person") acquired, or obtained the right to acquire, beneficial ownership of
Common Stock or other voting securities ("Voting Stock") that have 20% or more
of the voting power of the outstanding shares of Voting Stock or (ii) ten
calendar days (or such later date as may be determined by action of the Board of
Directors prior to the time any person or group of affiliated persons becomes an
Acquiring Person) following the commencement or announcement of an intention to
make a tender offer or exchange offer the consummation of which would result in
such person or group acquiring, or obtaining the right to acquire, beneficial
ownership of Voting Stock having 20% or more of the voting power of the
outstanding shares of Voting Stock (the earlier of such dates being called the
"Distribution Date"), the Rights will be evidenced, with respect to any of the
Company's Common Stock certificates outstanding as of the Record Date, by such
Common Stock certificates. The Rights Agreement provides that, until the
Distribution Date, the Rights will be transferred with and only with the
Company's Common Stock. Until the Distribution Date (or earlier redemption or
expiration of the Rights), new Common Stock certificates issued after the Record
Date upon transfer or new issuance of the Company's Common Stock will contain a
notation incorporating the Rights Agreement by reference. Until the Distribution
Date (or earlier redemption or expiration of the Rights), the surrender for
transfer of any of the Company's Common Stock certificates outstanding as of the
Record Date or issued thereafter will also constitute the transfer of the Rights
associated with the Common
C-1
Stock represented by such certificate. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Company's Common Stock
as of the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights. The Rights Agreement provides that,
as defined therein, the term "Acquiring Person" shall not include Xxxxx X.
Xxxxxxx (and certain related Persons) who currently beneficially own Voting
Stock in excess of 45% of the voting power.
The Rights are not exercisable until the Distribution Date. The Rights will
expire at the close of business on July 2, 2011, unless earlier redeemed or
exchanged by the Company as described below.
Exercise of Rights for Common Stock of the Company
In the event that a Person becomes an Acquiring Person, each holder of a
Right will thereafter have the right to receive, upon exercise, Common Stock
(or, in certain circumstances, cash, property or other securities of the
Company) having a value equal to two times the Purchase Price of the Right.
Notwithstanding any of the foregoing, following the occurrence of the event set
forth in this paragraph, all Rights that are, or (under certain circumstances
specified in the Rights Agreement) were, beneficially owned by any Acquiring
Person will be null and void.
Exchange of Rights
At any time after the occurrence of the event set forth under the heading
"Exercise of Rights for Common Stock of the Company" above, the Board of
Directors may exchange the Rights (other than Rights owned by the Acquiring
Person which shall have become void), in whole or in part, at an exchange ratio
of one share of Common Stock (or a fraction of a share of Junior Preferred Stock
having the same market value) per Right (subject to adjustment).
Redemption of Rights
At any time prior to 5:00 P.M., New York City time, on the tenth calendar
day following the Shares Acquisition Date, the Company may redeem the Rights in
whole, but not in part, at a price of $.001 per Right (the "Redemption Price").
Immediately upon the action of the Board of Directors of the Company electing to
redeem the Rights, the Company shall make announcement thereof, and upon such
action, the right to exercise the Rights will terminate and the only right of
the holders of Rights will be to receive the Redemption Price.
Rights Holder Not a Stockholder
C-2
Until a Right is exercised or exchanged, the holder thereof, as such, will
have no rights as a stockholder of the Company, including, without limitation,
the right to vote or to receive dividends.
Terms of the Junior Preferred Stock
The Junior Preferred Stock will rank junior to all other series of the
Company's preferred stock with respect to payment of dividends and as to
distributions of assets in liquidation. Each share of Junior Preferred Stock
will have a quarterly dividend rate per share equal to the greater of $10.00 or
1,000 times the per share amount of any dividend (other than a dividend payable
in shares of Common Stock or a subdivision of the Common Stock) declared from
time to time on the Common Stock, subject to certain adjustments. The Junior
Preferred Stock will not be redeemable. Generally, in the event of liquidation,
the holders of each one one-thousandth of a share of the Junior Preferred Stock
will receive a payment equivalent to that received by the holders of each share
of Common Stock. Generally, each share of Junior Preferred Stock will vote
together with the Common Stock and any other series of cumulative preferred
stock entitled to vote in such manner and will be entitled to 1,000 votes,
subject to certain adjustments. In the event of any merger, consolidation,
combination or other transaction in which shares of Common Stock are exchanged
for or changed into other stock or securities, cash and/or other property, each
share of Junior Preferred Stock will be entitled to receive 1,000 times the
aggregate amount of stock, securities, cash and/or other property, into which or
for which each share of Common Stock is changed or exchanged, subject to certain
adjustments. The foregoing dividend, voting and liquidation rights of the Junior
Preferred Stock are protected against dilution in the event that additional
shares of Common Stock are issued pursuant to a stock split or stock dividend or
distribution. Because of the nature of the Junior Preferred Stock's dividend,
voting, liquidation and other rights, the value of the one one-thousandth of a
share of Junior Preferred Stock purchasable with each Right is intended to
approximate the value of one share of Common Stock.
Amendments to Terms of the Rights
Any of the provisions of the Rights Agreement may be amended by the Board
of Directors of the Company prior to the Distribution Date. After the
Distribution Date, the provisions of the Rights Agreement may be amended by the
Board in order to cure any ambiguity, defect or inconsistency, or to make
changes which do not adversely affect the interests of holders of Rights
(excluding the interests of any Acquiring Person).
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A dated
____, 2001. A copy of the Rights Agreement is available free of charge from the
Company. This summary description of the Rights does not purport to be complete
and is qualified in its entirety by reference to the Rights Agreement, which is
hereby incorporated herein by reference.
C-3
EXHIBIT D
ATLAS AIR WORLDWIDE HOLDINGS, INC.
INCUMBENCY CERTIFICATE
I, Xxxxx X. Xxxxxxxx, do hereby certify that I am the Secretary of Atlas
Air Worldwide Holdings, Inc., a Delaware Corporation (the "Company"), and do
further certify in such capacity that (i) the following named individuals are
duly appointed officers of the Company who hold the offices set forth opposite
their names, and (ii) the signature opposite the name and title of each such
officer is his true and correct signature:
NAME OFFICE SIGNATURE
---- ------ ---------
Xxxxxxx X. Xxxxxxx Chief Executive Officer and Treasurer _________________________________
Xxxxx X. Xxxxxxx President and Chief Operating Officer _________________________________
Xxxxxx X. Xxxxx Senior Vice President and General _________________________________
Counsel
Xxxxxx X. Xxxxxxxx Vice President and Controller _________________________________
Xxxx X. xx Xxxxx Senior Vice President - Strategic _________________________________
Planning and Assistant Secretary
Xxxxx X. Xxxxxxxx Secretary
D-1
IN WITNESS WHEREOF, I have hereunto set my hand this ___ day of _____,
2001.
___________________________________________
Xxxxx X. Xxxxxxxx
Secretary
I, _____, ______ of the Company, do hereby certify that Xxxxx X. Xxxxxxxx
is duly elected, qualified and acting Secretary of the Company, and that his
signature set forth above is his genuine signature.
IN WITNESS WHEREOF, I have hereunto set my hand this ___ day of _____,
2001.
__________________________________________
[Name]
[Title]
D-2
