<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
__________
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF
SECURITIES PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
TRW Inc.
- -------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Ohio 34-575430
- --------------------------------------- -----------------
(State of Incorporation or Organization) (I.R.S. Employer
Identification Number)
1900 Richmond Road, Cleveland, OH 44124
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(Address of principal executive offices) (Zip Code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
- ------------------- ------------------------------
Preference Stock Purchase Rights New York Stock Exchange
Chicago Stock Exchange
Pacific Stock Exchange
Philadelphia Stock Exchange
Securities to be registered pursuant to Section 12(g) of the Act:
None
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(Title of Class)
<PAGE> 2
ITEM 1. Description of Registrant's Securities to be Registered.
The Board of Directors (the "Directors") of TRW Inc. (the "Company")
have declared a dividend distribution of one right (a "Right") for each
outstanding share of Common Stock, $.625 par value (the "Common Shares"), of
the Company. The distribution is payable on May 17, 1996 (the "Record Date")
to the shareholders of record as of the close of business on the Record Date.
Each Right entitles the registered holder to purchase from the Company one
one-hundredth of a share of Cumulative Redeemable Serial Preference Stock II,
Series 4, without par value (the "Preference Stock II"), of the Company at a
price of $300 per one one-hundredth of a share of Preference Stock II (the
"Purchase Price"), subject to adjustment. The description and terms of the
Rights are set forth in a Rights Agreement, dated as of April 24, 1996 (the
"Rights Agreement"), between the Company and National City Bank, as Rights
Agent (the "Rights Agent").
Until the earlier to occur of (i) the close of business on the tenth
business day following a public announcement that a person or group of
affiliated or associated persons (an "Acquiring Person") has acquired, or
obtained the right to acquire, beneficial ownership of 20% or more of the
outstanding shares of capital stock of the Company which may be voted on all
matters submitted to shareholders of the Company generally (the "Voting
Shares"); provided, however, the Company, any subsidiary of the Company, any
employee benefit or stock ownership plan of the Company, any person who
acquires Voting Shares from the Company in transactions approved by the
Directors, any person who becomes the beneficial owner of 20% or more of the
outstanding Voting Shares as a result of an acquisition of Voting Shares by the
Company (so long as that person does not afterwards acquire additional Voting
Shares), and any person whom the Directors determine has inadvertently become
an Acquiring Person and who promptly divests sufficient Voting Shares so as no
longer to be an Acquiring Person are excluded from the definition of Acquiring
Person, (ii) the close of business on the tenth business day (or such later
date as may be specified by a majority of the Directors) following the
commencement of a tender offer or exchange offer by a person or group of
affiliated or associated persons, the consummation of which would result in
beneficial ownership by such person of 20% or more of such outstanding Voting
Shares or (iii) the close of business on the tenth business day after the first
occurrence of certain events described below which would result in the Rights
becoming exercisable to purchase Common Shares or common stock of another
person (the earliest of such dates being hereinafter called the "Distribution
Date"), the Rights will be evidenced, with respect to any of the Common Share
certificates outstanding as of the Record Date, and certain subsequently issued
Common Shares, by such Common Share certificates. The Rights Agreement
provides that, until the Distribution Date, the Rights will be transferred with
and only with the Common Shares. Until the Distribution Date (or earlier
redemption or expiration of the Rights), new Common Share certificates issued
after the Record Date upon transfer or new issuance of Common Shares 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
<PAGE> 3
of any certificates for Common Shares outstanding as of the Record Date will
also constitute the transfer of the Rights associated with the Common Shares
represented by such certificates. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights (the "Right
Certificates") will be mailed to holders of record of the Common Shares as of
the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.
No Right is exercisable at any time prior to the Distribution Date.
The Rights will expire on April 24, 2006 (the "Final Expiration Date") unless
earlier redeemed by the Company as described below. Until a Right is
exercised, the holder thereof, as such, will have no rights as a shareholder of
the Company, including without limitation the right to vote or to receive
dividends. Upon the occurrence of certain events described below, the Rights
will become exercisable to purchase Common Shares or common stock of another
person in lieu of shares of Preference Stock II.
In the event that (i) an Acquiring Person merges into or combines with
the Company where the Company is the surviving corporation or engages in
certain other self-dealing transactions, (ii) during such time as there is an
Acquiring Person, there is a reclassification of securities or other
transaction which increases by more than one percent the amount of Company
securities owned by the Acquiring Person, (iii) any person, together with all
affiliated and associated persons, becomes an Acquiring Person, or (iv) (a) (1)
any person is determined by the Directors to have become, or to have announced
an intention to become, the owner of an amount of Voting Shares that the
Directors determine is substantial (which amount is not less than 5% of the
outstanding Voting Shares) and (2) the Directors determine that such ownership
is causing or may reasonably be anticipated to cause a material adverse effect
on the Company's government contracting business (such person being an "Adverse
Person") or (b) as to any specific person, the Directors have established a
specific percentage of outstanding Voting Shares (which percentage is not less
than 5% nor less than the ownership level of Voting Shares which such person
has publicly announced it owns) which, if owned by such person, will result in
such person being declared an Adverse Person in accordance with the criteria
set forth above and such person becomes an Adverse Person (each event described
in (i) - (iv) above being a "Flip-in Event"), proper provision shall be made so
that each holder of a Right, other than Rights that are or were owned
beneficially by such person on or after the date upon which such person became
an Acquiring Person or an Adverse Person (which will thereafter be void), will
thereafter have the right to receive, upon exercise thereof at the then current
exercise price of the Right, that number of Common Shares (or, in certain
circumstances, cash, property or other securities of the Company or any
combination thereof) having a market value of two times the exercise price of
the Right.
In the event that after any person has become an Acquiring Person (i)
the Company merges with or into any person and the Company is not the
surviving corporation, (ii) any person merges with or into the Company and the
Company is the surviving corporation, but its Common
<PAGE> 4
Shares are changed or exchanged or (iii) 50% or more of the Company's assets or
earning power, including without limitation securities creating obligations of
the Company, are sold to any person (each event described in (i) - (iii) above
being a "Flip-over Event"), proper provision shall be made so that each holder
of a Right (other than Rights held by an Acquiring Person or an Adverse Person)
will thereafter have the right to receive, upon exercise thereof at the then
current Purchase Price, that number of shares of common stock (or, under
certain circumstances, an economically equivalent security or securities) of
such other person which at the time of such transaction would have a market
value of two times the exercise price of the Right.
The Purchase Price payable, and the number of shares of Preference
Stock II or other securities or property issuable upon exercise of the Rights
are subject to adjustment from time to time to prevent dilution. With certain
exceptions, no adjustment in the Purchase Price will be required until
cumulative adjustments require an adjustment in the Purchase Price of at least
one percent. No fractional shares of Preference Stock II will be issued (other
than fractions which are integral multiples of one one-hundredth of a share of
Preference Stock II), and in lieu thereof, a payment in cash may be made based
on the market price of the shares of Preference Stock II on the last trading
day prior to the date of exercise.
The Company may redeem the Rights in whole, but not in part, at a
price of $.01 per Right, subject to adjustment (the "Redemption Price") at any
time prior to the earlier of (i) the close of business on the tenth business
day after the first occurrence of a Flip-in Event or a Flip-over Event or (ii)
April 24, 2006; provided, however, that the Directors may not redeem the Rights
after they declare a person to be an Adverse Person. Immediately upon the
effective date of the action of the Directors electing to redeem the Rights,
the right to exercise the Rights will terminate and the only right of the
holders of Rights will be to receive the Redemption Price. The Company will
give notice of any redemption to the holders of the then outstanding Rights by
mailing notice to all such holders at their last addresses as they appear on
the registry books of the Rights Agent.
At any time after the occurrence of a Flip-in Event or a Flip-over
Event, but before any person or group of affiliated or associated persons
becomes the beneficial owner of 50% or more of the then outstanding Common
Shares, the Company may exchange all or part of the then outstanding and
exercisable Rights for Common Shares at an exchange ratio of one Common Share
per Right, as adjusted. Immediately upon the action of the Directors ordering
the exchange of any Rights, the right to exercise those Rights shall terminate
and the only right thereafter of a holder of those Rights will be to receive
the appropriate number of Common Shares in exchange. The Company will give
notice of any exchange by public announcement and by mailing notice of the
exchange to all the holders of the affected Rights at their last addresses as
they appear on the registry books of the Rights Agent.
The Company may amend the Rights Agreement without the approval of any
holders of Rights in order to cure any ambiguity, to correct or supplement
<PAGE> 5
any defective or inconsistent provision, or to make any other provisions with
respect to the Rights as the Company may deem necessary or desirable; provided,
however, that from and after the earlier of (i) the Distribution Date or (ii)
the date on which the Directors declare any person to be an Adverse Person (the
"Final Amendment Date") the Rights Agreement may not be amended in any manner
that would adversely affect the interests of the holders of Rights. Without
limiting the foregoing, the Company may at any time prior to the Final
Amendment Date amend the Rights Agreement to lower the ownership thresholds
governing when a beneficial owner becomes an Acquiring Person and when the
Distribution Date occurs to not less than the greater of (a) the sum of .001%
and the largest percentage of outstanding Common Shares then beneficially owned
by any person (other than the Company, any subsidiary of the Company, any
employee benefit or stock ownership plan of the Company, or any person who
acquires Voting Shares from the Company in transactions approved by the
Directors) or (b) 10%.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
on terms not approved by the Directors. The Rights should not interfere with
any merger or other business combination approved by the Directors since the
Directors may, at their option, at any time until ten business days following
the first occurrence of a Flip-in Event or a Flip-over Event, redeem all, but
not less than all, of the then outstanding Rights at the applicable Redemption
Price.
This summary description of the Rights is as of April 24, 1996, does
not purport to be complete, and is qualified in its entirety by reference to
the Rights Agreement, which is incorporated herein by this reference.
ITEM 2. Exhibits.
---------
1. Rights Agreement, dated as of April 24, 1996, between the
Registrant and National City Bank, as Rights Agent, which
includes as Exhibit B thereto the Form of Right Certificate.
<PAGE> 6
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this registration statement to be
signed on its behalf by the undersigned, thereto duly authorized.
TRW Inc.
(Registrant)
By /s/ Martin A. Coyle
---------------------------------
Martin A. Coyle
Executive Vice President,
General Counsel and Secretary
April 25, 1996
<PAGE> 7
EXHIBIT INDEX
Exhibit No. Description
----------- -----------
1 Rights Agreement, dated as of April 24, 1996,
between the Registrant and National City Bank,
as Rights Agent, which includes as Exhibit B
thereto the Form of Right Certificate.
<PAGE> 1
Exhibit 1
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TRW INC.
and
NATIONAL CITY BANK
RIGHTS AGREEMENT
Dated as of April 24, 1996
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<PAGE> 2
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Section 1. Certain Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 2. Appointment of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 3. Issue of Right Certificates . . . . . . . . . . . . . . . . . . . . . . . . . 6
Section 4. Form of Right Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Section 5. Countersignature and Registration . . . . . . . . . . . . . . . . . . . . . 8
Section 6. Transfer, Split Up, Combination and
Exchange of Right Certificates;
Mutilated, Destroyed, Lost or
Stolen Right Certificates . . . . . . . . . . . . . . . . . . . . . . 9
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights . . . . . . . . . . . . . . . . . . . . . . 10
Section 8. Cancellation and Destruction of
Right Certificates . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 9. Company Covenants Concerning Shares and
Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 10. Record Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 11. Adjustment of Purchase Price, Number and
Type of Shares or Number of Rights . . . . . . . . . . . . . . . . . 14
Section 12. Certificate of Adjusted Purchase Price or
Number of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 13. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power . . . . . . . . . . . . . . . . . . . . . 24
Section 14. Fractional Rights and Fractional Shares . . . . . . . . . . . . . . . . . . . 27
Section 15. Rights of Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
Section 16. Agreement of Rights Holders . . . . . . . . . . . . . . . . . . . . . . . . . 29
</TABLE>
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<TABLE>
<S> <C> <C>
Section 17. Right Certificate Holder Not Deemed a
Shareholder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 18. Concerning the Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 19. Merger or Consolidation or Change of Name
of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 20. Duties of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 21. Change of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Section 22. Issuance of New Right Certificates . . . . . . . . . . . . . . . . . . . . . . 34
Section 23. Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 24. Notice of Certain Events . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Section 25. Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 26. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
Section 27. Supplements and Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 28. Successors; Certain Covenants . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 29. Benefits of this Agreement . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 30. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 31. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 32. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 33. Descriptive Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Exhibit A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
Exhibit B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1
</TABLE>
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RIGHTS AGREEMENT
----------------
This RIGHTS AGREEMENT, dated as of April 24, 1996 (this
"Agreement"), is made and entered into by and between TRW INC., an Ohio
corporation (the "Company"), and NATIONAL CITY BANK, a national banking
association (the "Rights Agent").
RECITALS
--------
WHEREAS, on April 24, 1996, the Board of Directors of the
Company (the "Directors") authorized and declared a dividend distribution of
one right ("Right") for each share of Common Stock, $.625 par value, of the
Company (a "Common Share") outstanding as of the close of business on May 17,
1996 (the "Record Date"), each Right initially representing the right to
purchase one one-hundredth of a share of Preference Stock II (as hereinafter
defined), upon the terms and subject to the conditions herein set forth, and
further authorized and directed the issuance of one Right with respect to (a)
each Common Share issued or delivered by the Company (whether originally issued
or delivered from the Company's treasury) after the Record Date but prior to
the Distribution Date (as hereinafter defined) and (b) for each Common Share
issued between the Record Date and the Expiration Date (as hereinafter defined)
upon exercise of employee stock options granted prior to the Distribution Date
or upon the conversion of convertible securities issued prior to the
Distribution Date;
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 shall have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (other than
the Company or any Related Person) who or which, together with all Affiliates
and Associates of such Person, shall be the Beneficial Owner of 20% or more of
the Voting Shares then outstanding. Notwithstanding the foregoing, no Person
shall become an "Acquiring Person" as the result of an acquisition of Voting
Shares by the Company which, by reducing the number of shares outstanding,
increases the proportionate number of shares beneficially owned by such Person
to 20% or more of the Voting Shares then outstanding; PROVIDED, HOWEVER, that
if a Person shall become the Beneficial Owner of 20% or more of the Voting
Shares then outstanding by reason of share purchases by the Company and shall,
after such share purchases by the Company, become the Beneficial Owner of any
additional Voting Shares, then such Person shall be
<PAGE> 5
deemed to be an "Acquiring Person." Notwithstanding the foregoing, if the
Directors determine in good faith that a Person who would otherwise be an
"Acquiring Person," as defined pursuant to the foregoing provisions of this
Section 1(a), has become such inadvertently, and such Person divests as
promptly as practicable a sufficient number of Voting Shares so that such
Person would no longer be an "Acquiring Person," as defined pursuant to the
foregoing provisions of this Section 1(a), then such Person shall not be deemed
to be an "Acquiring Person" for any purposes of this Agreement.
(b) "Adverse Person" shall mean any Person declared to be
an Adverse Person by the Directors upon determination (with the
concurrence of a majority of the Directors, which majority shall
include a majority of the Directors who are not representatives,
nominees, Affiliates or Associates of an Acquiring Person or an
Adverse Person) that the criteria set forth in Section 11(a)(ii)(D)
apply to such Person.
(c) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act, as in effect on the date of this
Agreement.
(d) 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, directly or indirectly, has the
right to acquire (whether such right is exercisable
immediately or only after the passage of time) pursuant to any
agreement, arrangement or understanding (whether or not in
writing), or upon the exercise of conversion rights, exchange
rights, rights (other than the Rights), warrants or options,
or otherwise; PROVIDED, HOWEVER, that a Person shall not be
deemed the Beneficial Owner of, or to beneficially own, (A)
securities tendered pursuant to a tender or exchange offer
made by or on behalf of such Person or any of such Person's
Affiliates or Associates until such tendered securities are
accepted for purchase or exchange, (B) securities issuable
upon exercise of Rights at any time prior to a Triggering
Event, or (C) 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,
pursuant to Section 3(a) or Section 22 hereof (the "Original
Rights") or pursuant to Section 11(i) hereof in connection
with an adjustment made with respect to any Original Rights;
or
(ii) which such Person or any of such Person's
Affiliates or Associates, directly or indirectly, has the
right to vote or dispose of, including pursuant to any
agreement, arrangement or understanding (whether or not in
writing); or
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<PAGE> 6
(iii) of which any other Person is the Beneficial
Owner if such Person or any of such Person's Affiliates or
Associates has any agreement, arrangement or understanding
(whether or not in writing) with such other Person (or any of
such other Person's Affiliates or Associates) with respect to
acquiring, holding, voting or disposing of any securities of
the Company;
PROVIDED, HOWEVER, that a Person shall not be deemed the Beneficial
Owner of, or to beneficially own, any security (A) if such Person has
the right to vote such security pursuant to an agreement, arrangement
or understanding (whether or not in writing) which (1) arises solely
from a revocable proxy given to such Person in response to a public
proxy or consent solicitation made pursuant to, and in accordance
with, the applicable rules and regulations of the Exchange Act and (2)
is not also then reportable on Schedule 13D under the Exchange Act (or
any comparable or successor report), or (B) if such beneficial
ownership arises solely as a result of such Person's status as a
"clearing agency," as defined in Section 3(a)(23) of the Exchange Act;
and PROVIDED, FURTHER, that nothing in this paragraph shall cause a
Person engaged in business as an underwriter of securities to be the
Beneficial Owner of any securities acquired through such Person's
participation in good faith in an underwriting syndicate pursuant to
an agreement to which the Company is a party until the expiration of
40 calendar days after the date of such acquisition.
(e) "Business Day" shall mean any day other than a
Saturday, Sunday or a day on which banking institutions in the State
of Ohio (or such other state in which the principal office of the
Rights Agent is located) are authorized or obligated by law or
executive order to close.
(f) "Close of Business" on any given date shall mean 5:00
P.M., Cleveland, Ohio time, on such date; PROVIDED, HOWEVER, that if
such date is not a Business Day it shall mean 5:00 P.M., Cleveland,
Ohio time, on the next succeeding Business Day.
(g) "Common Shares" when used with reference to the
Company shall mean the Common Stock, $.625 par value, of the Company;
PROVIDED, HOWEVER, that, if the Company is the continuing or surviving
corporation in a transaction described in Section 11(a)(ii) or Section
13(a)(ii) hereof, "Common Shares" when used with reference to the
Company shall mean the capital stock or equity security with the
greatest aggregate voting power of the Company. "Common Shares" when
used with reference to any corporation or other legal entity, other
than the Company, including an Issuer (as defined in Section 13(b)
hereof), shall mean the capital stock or equity security with the
greatest aggregate voting power of such corporation or other legal
entity.
(h) "Company" shall mean TRW Inc., an Ohio corporation.
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<PAGE> 7
(i) "Distribution Date" shall mean the earlier of: (i)
the Close of Business on the tenth Business Day after the Share
Acquisition Date, (ii) the Close of Business on the tenth Business Day
(or such later date as may be specified by a majority of the Directors
then in office) after the date of the commencement of a tender or
exchange offer (as determined by reference to Rule 14d-2(a) under the
Exchange Act) by any Person (other than the Company or any Related
Person), the consummation of which offer would result in beneficial
ownership by such Person of 20% or more of the outstanding Voting
Shares and (iii) the Close of Business on the tenth Business Day after
the occurrence of a Triggering Event (provided that if any of (i),
(ii) and (iii) occur prior to the Record Date, then the Distribution
Date shall occur on and be the Record Date).
(j) "Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended.
(k) "Expiration Date" shall mean the earlier of (i) the
Close of Business on the Final Expiration Date and (ii) the time at
which the Rights are redeemed as provided in Section 23 hereof.
(l) "Final Amendment Date" shall mean the earlier of (i)
the Distribution Date or (ii) the date on which the Directors declare
any Person to be an Adverse Person in accordance with Section
11(a)(ii)(D) hereof.
(m) "Final Expiration Date" shall mean the tenth
anniversary of the date of this Agreement.
(n) "Flip-in Event" shall mean any event described in
clauses (A), (B), (C) or (D) of Section 11(a)(ii) hereof.
(o) "Flip-over Event" shall mean any event described in
subsections (i), (ii) or (iii) of Section 13(a) hereof.
(p) "Issuer" shall have the meaning set forth in Section
13(b) of this Agreement.
(q) "NASDAQ" shall mean the National Association of
Securities Dealers, Inc. Automated Quotation System.
(r) "Person" shall mean any individual, firm,
corporation, partnership or other legal entity, and shall include any
successor (by merger or otherwise) of such entity.
(s) "Preference Stock II" shall mean shares of Cumulative
Redeemable Preference Stock II, Series 4, without par value, of the
Company
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<PAGE> 8
having the rights and preferences set forth in the Amended Articles of
Incorporation of the Company, as amended by the form of Certificate of
Adoption of Amendment attached to this Agreement as Exhibit A.
(t) "Purchase Price" shall mean initially $300 per one
one-hundredth of a share of Preference Stock II and shall be subject
to adjustment from time to time as provided in this Agreement.
(u) "Redemption Price" shall mean $.01 per Right, subject
to adjustment by resolution of the Directors to reflect any stock
split, stock dividend or similar transaction occurring after the date
hereof.
(v) "Related Person" shall mean (i) any Subsidiary of the
Company, (ii) any employee benefit or stock ownership plan of the
Company or any entity holding Common Shares for or pursuant to the
terms of any such plan, or (iii) any Person who acquires Voting Shares
from the Company or any other Related Person in one or a series of
related transactions, each of which is approved by a majority of the
Directors, which majority shall include a majority of the Directors
who are not representatives, nominees, Affiliates or Associates of an
Acquiring Person or an Adverse Person, provided that the first such
approval shall be deemed an approval as well with respect to all
Voting Shares of which such Person is the beneficial owner immediately
prior to the time of such first approval; PROVIDED, HOWEVER, that if
any Person who becomes a Related Person solely by virtue of subsection
(iii) above, or any Affiliate or Associate of such Person,
subsequently becomes the Beneficial Owner of any additional Voting
Shares in a transaction or transactions not approved by a majority of
the Directors in the manner provided in subsection (iii) above such
Person shall no longer be deemed a "Related Person" with respect to
all Voting Shares of which it, or any of its Affiliates or Associates,
is the Beneficial Owner.
(w) "Right" shall have the meaning set forth in the
recitals to this Agreement.
(x) "Right Certificates" shall mean certificates
evidencing the Rights, in substantially the form of Exhibit B attached
hereto.
(y) "Rights Agent" shall mean National City Bank, and its
successors and assigns.
(z) "Securities Act" shall mean the Securities Act of
1933, as amended.
(aa) "Share Acquisition Date" shall mean the first date of
public announcement by the Company or an Acquiring Person (by press
release,
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filing made with the Securities and Exchange Commission or otherwise)
that an Acquiring Person has become such.
(bb) "Subsidiary" of any Person shall mean any corporation
or other legal entity of which a majority of the voting power of the
voting equity securities or equity interests is owned, directly or
indirectly, by such Person.
(cc) "Trading Day" shall mean any day on which the
principal national securities exchange on which the Common Shares are
listed or admitted to trading is open for the transaction of business
or, if the Common Shares are not listed or admitted to trading on any
national securities exchange, a Business Day.
(dd) "Triggering Event" shall mean any Flip-in Event or
Flip-over Event.
(ee) "Voting Shares" shall mean all capital stock of the
Company authorized to be issued from time to time under the Amended
Articles of Incorporation of the Company which by its terms may be
voted on all matters submitted to shareholders of the Company
generally.
Section 2. APPOINTMENT OF RIGHTS AGENT. The Company appoints
the Rights Agent to act as agent for the Company and the holders of the Rights
(who, in accordance with Section 3, shall also be, prior to the Distribution
Date, the holders of the Common Shares) in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment and
hereby certifies that it complies with the requirements of the New York Stock
Exchange governing transfer agents and registrars. The Company may from time
to time act as Co-Rights Agent or appoint such Co-Rights Agents as it may deem
necessary or desirable. Any actions which may be taken by and any deliveries
which are to be made to the Rights Agent pursuant to the terms of this
Agreement may be taken by and may be delivered to any such Co-Rights Agents.
Section 3. ISSUE OF RIGHT CERTIFICATES. (a) Until the
Distribution Date, (i) the Rights will be evidenced by the certificates
representing Common Shares registered in the names of the record holders
thereof (which certificates representing Common Shares shall also be deemed to
be Right Certificates) and not by separate Right Certificates, (ii) the Rights
will be transferable only in connection with the transfer of the underlying
Common Shares, and (iii) the transfer of any certificates evidencing Common
Shares in respect of which Rights have been issued shall also constitute the
transfer of the Rights associated with the Common Shares evidenced by such
certificates.
(b) Rights will be issued by the Company in respect of
all Common Shares issued or delivered by the Company (whether originally issued
or delivered from the Company's treasury) after the Record Date but prior to
the Distribution Date, provided that in the case of Common Shares issued upon
exercise of employee stock
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options granted prior to the Distribution Date and securities issued prior to
the Distribution Date which are convertible into Common Shares, Rights shall be
issued in respect of all such shares issued prior to the Expiration Date.
Rights shall also be issued to the extent provided in Section 22 in respect of
Common Shares which are issued (whether originally issued or from the Company's
treasury) after the Distribution Date and prior to the Expiration Date.
Certificates for Common Shares which become outstanding (including, without
limitation, certificates issued upon surrender for transfer) after the Record
Date but prior to the Distribution Date shall bear the following legend or such
similar legend as the Company may deem appropriate and as is 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 any stock exchange or transaction reporting system on
which the Rights may from time to time be listed or quoted, or to conform to
usage:
This Certificate also evidences and entitles the holder hereof
to certain Rights as set forth in a Rights Agreement between
TRW Inc. and National City Bank, dated as of April 24, 1996,
as it may be amended from time to time (the "Rights
Agreement"), the terms of which are incorporated herein by
this reference and a copy of which is on file at the principal
executive offices of TRW Inc. Under certain circumstances, as
set forth in the Rights Agreement, such Rights may be
redeemed, may expire, may be amended or may be evidenced by
separate certificates and no longer be evidenced by this
Certificate. TRW Inc. will mail to the holder of this
Certificate a copy of the Rights Agreement without charge
within five business days after receipt of a written request
therefor. Under certain circumstances as set forth in the
Rights Agreement, Rights beneficially owned by an Acquiring
Person or an Adverse Person and any Affiliate or Associate
thereof (as such terms are defined in the Rights Agreement)
and any subsequent holder of such Rights may become null and
void.
(c) As soon as practicable after the Distribution Date,
the Company shall give the Rights Agent written notice thereof and the Rights
Agent shall send, by first-class, insured, postage prepaid mail, to each record
holder of Common Shares as of the Close of Business on the Distribution Date,
at the address of such holder shown on the records of the Company, a Right
Certificate, evidencing one Right for each Common Share so held, subject to
adjustment as provided herein. As of and after the Distribution Date, the
Rights will be evidenced solely by such Right Certificates.
Section 4. FORM OF RIGHT CERTIFICATES. (a) The Right
Certificates (and the forms of election to purchase and of assignment to be
printed on the reverse thereof)
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shall be substantially in the form set forth as Exhibit B hereto with such
changes, marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange or transaction
reporting system on which the Common Shares or Rights may from time to time be
listed or quoted, or to conform to usage. Subject to Sections 11(i) and 22
hereof, the Right Certificates, whenever issued, shall be dated as of the
Distribution Date, and on their face shall entitle the holders thereof to
purchase such number of one one-hundredths of a share of Preference Stock II as
shall be set forth therein at the Purchase Price set forth therein, but the
number and type of securities purchasable upon exercise of each Right at the
Purchase Price shall be subject to adjustment as provided herein.
(b) Any Right Certificate issued pursuant to Sections 3,
6, 7(c), 11(i) or 22 hereof that represents Rights the Beneficial Owner of
which is any Acquiring Person or Adverse Person or any Associate or Affiliate
of an Acquiring Person or Adverse Person, and any Right Certificate issued at
any time upon the transfer of any Rights to an Acquiring Person or Adverse
Person or any Associate or Affiliate thereof or to any nominee of such
Acquiring Person or Adverse Person, Associate or Affiliate (including any
Rights beneficially owned by a transferee of such Acquiring Person or Adverse
Person or any Associate or Affiliate of any of them who becomes a transferee
(i) after such Acquiring Person or Adverse Person became such or (ii) prior to
or concurrently with such Acquiring Person or Adverse Person having become
such, where any such transferee has received such Rights pursuant to a transfer
which the Directors have determined is part of a plan, arrangement or
understanding which has as a primary purpose or effect the avoidance of
Sections 11(a)(ii) or 13(a) hereof), shall be subject to and bear the following
legend or such similar legend as the Company may deem appropriate and as is 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 any stock exchange or any transaction
reporting system on which the Common Shares or the Rights may from time to time
be listed or quoted, or to conform to usage:
The Rights represented by this Right Certificate are or were
issued to, or beneficially owned by, a Person who was an
Acquiring Person or an Adverse Person or an Affiliate or an
Associate of an Acquiring Person or an Adverse Person (as such
terms are defined in the Rights Agreement). This Right
Certificate and the Rights represented hereby may become null
and void in the circumstances specified in the Rights
Agreement.
Section 5. COUNTERSIGNATURE AND REGISTRATION. (a) The Right
Certificates shall be executed on behalf of the Company by its Chairman of the
Board, President or any Vice President, either manually or by facsimile
signature, and shall
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have affixed thereto the Company's seal or a facsimile thereof which shall be
attested by the Secretary or an Assistant Secretary of the Company, either
manually or by facsimile signature. The Right Certificates shall be manually
countersigned by the Rights Agent and shall not be valid for any purpose unless
so countersigned. In case any officer of the Company who shall have signed any
of the Right Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Right Certificates, nevertheless, may be countersigned by the Rights
Agent, and issued and delivered by the Company with the same force and effect
as though the person who signed such Right Certificates had not ceased to be
such officer of the Company; and any Right Certificate may be signed on behalf
of the Company by any person who, 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 Rights Agreement any
such person was not such an officer.
(b) Following the Distribution Date, the Rights Agent
will keep or cause to be kept, at the principal office of the Rights Agent
designated for such purpose and at such other offices as the Company shall
advise the Rights Agent are required to comply with any applicable law or with
any rule or regulation made pursuant thereto or with any rule or regulation of
any stock exchange or any transaction reporting system on which the Common
Shares or the Rights may from time to time be listed or quoted, 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 the face of each of the Right
Certificates and the date of each of the Right Certificates.
Section 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF
RIGHT CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHT CERTIFICATES.
(a) Subject to Sections 4(b), 7(d) and 14 hereof, at any time after the Close
of Business on the Distribution Date and prior to 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 Preference Stock II
(or other securities, 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 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 principal office of the Rights Agent designated for such
purpose. The Company may require payment of a sum sufficient to cover any tax
or governmental charge that may be imposed in connection with any transfer,
split up, combination or exchange of Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of loss, theft or destruction,
of indemnity or security
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<PAGE> 13
reasonably satisfactory to them, and reimbursement to the Company and the
Rights Agent of all reasonable expense incidental thereto, and upon surrender
to the Rights Agent and cancellation of the Right Certificate if mutilated, the
Company will execute and deliver a new Right Certificate of like tenor to the
Rights Agent for countersignature and 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) The registered holder of any Right Certificate may
exercise the Rights evidenced thereby (except as otherwise provided herein) in
whole or in part at any time after the Distribution Date and prior to the
Expiration 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 an office of the Rights Agent designated for such purpose, together
with payment of the Purchase Price for each one one-hundredth of a share of
Preference Stock II (or other securities, cash or assets, as the case may be)
as to which such surrendered Rights are exercised and an amount in cash equal
to any applicable transfer tax required to be paid by the holder of such Right
Certificate in accordance with Sections 9, 11(a)(iii) and 23 hereof. The
Purchase Price shall be payable in lawful money of the United States of America
by certified check or bank draft payable to the order of the Company.
(b) Subject to Sections 7(d) and 11(a)(ii) hereof, upon
receipt of a Right Certificate and payment as described above, the Rights Agent
shall promptly (i) requisition from any transfer agent of the shares of
Preference Stock II (or make available, if the Rights Agent is the transfer
agent) certificates representing the number of shares of Preference Stock II to
be purchased and the Company hereby irrevocably authorizes its transfer agent
to comply with all such requests, or, if the Company shall have elected to
deposit the total number of shares of Preference Stock II issuable upon
exercise of the Rights hereunder with a depositary agent, requisition from the
depositary agent depositary receipts representing such number of one
one-hundredths of a share of Preference Stock II as are to be purchased (in
which case certificates for the shares of Preference Stock II represented by
such receipts shall be deposited by the transfer agent with the depositary
agent) and the Company will direct the depositary agent to comply with such
request, (ii) promptly after receipt of such certificates (or depositary
receipts, as the case may be), 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, (iii) if appropriate,
requisition from the Company the amount of cash to be paid in lieu of the
issuance of fractional shares in accordance with Section 14 hereof or in lieu
of the issuance of Common Shares in accordance with Section 11(a)(iii) hereof,
(iv) if appropriate, after receipt, promptly deliver such cash to or upon the
order of the registered holder of such Right Certificate, and (v) deliver any
due bill or other instrument provided to the Rights Agent by the Company for
delivery to the registered holder of such Right Certificate as provided by
Section 11(l) hereof.
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<PAGE> 14
(c) 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 Section 14
hereof.
(d) 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 any purported transfer of any Right
Certificate pursuant to Section 6 hereof or exercise of a Right Certificate as
set forth in this Section 7 unless the registered holder of such Right
Certificate shall have (i) completed and signed the certificate following the
form of assignment or election to purchase set forth on the reverse side of the
Right Certificate surrendered for such transfer or exercise and (ii) provided
such additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company shall
reasonably request.
(e) Notwithstanding anything in this Agreement to the
contrary, the Rights shall not be exercisable in any jurisdiction if the
requisite qualification or registration in such jurisdiction shall not have
been effected or the exercise of the Rights shall not be permitted under
applicable law. The Company shall give written notice of such jurisdiction to
the Rights Agent.
Section 8. CANCELLATION AND DESTRUCTION OF RIGHT
CERTIFICATES. All Right Certificates surrendered for the purpose of exercise,
transfer, split up, combination or exchange shall, if surrendered to the
Company or to any of its stock transfer 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 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, or
shall, at the written request of the Company, destroy such canceled Right
Certificates and deliver a certificate of destruction thereof to the Company.
Section 9. COMPANY COVENANTS CONCERNING SHARES AND RIGHTS.
The Company covenants and agrees that:
(a) It will cause to be reserved and kept available out
of its authorized and unissued shares of Preference Stock II or any shares of
Preference Stock II held in its treasury, the number of shares of Preference
Stock II that will be sufficient to permit the exercise pursuant to Section 7
hereof of all outstanding Rights.
(b) So long as the shares of Preference Stock II (and,
following the occurrence of a Triggering Event, Common Shares and/or other
securities) issuable and deliverable upon the exercise of the Rights may be
listed on a national securities
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<PAGE> 15
exchange, it will endeavor to cause, from and after such time as the Rights
become exercisable, all shares reserved for such issuance to be listed on such
exchange upon official notice of issuance.
(c) It will take all such action as may be necessary to
ensure that all shares of Preference Stock II (and, following the occurrence of
a Triggering Event, Common Shares and/or other securities) delivered upon
exercise of Rights, at the time of delivery of the certificates for such
shares, shall be (subject to payment of the Purchase Price) duly and validly
authorized and issued, fully paid and nonassessable shares, free and clear of
any liens, encumbrances or other adverse claims and not subject to any rights
of call or first refusal.
(d) It will pay when due and payable any and all federal
and state transfer taxes and charges that may be payable in respect of the
issuance or delivery of the Right Certificates or of any shares of Preference
Stock II (or Common Shares and/or other securities, as the case may be) upon
the exercise of Rights; PROVIDED, HOWEVER, it will not be required to pay any
transfer tax or charge which may be payable in respect of any transfer or
delivery of Right Certificates to a person other than, or the issuance or
delivery of certificates or depositary receipts representing shares of
Preference Stock II (or Common Shares 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 to issue or deliver any
certificates for shares of Preference Stock II (or Common Shares and/or other
securities, as the case may be) upon the exercise of any Rights until any such
tax or charge shall have been paid (any such tax or charge being payable by the
holder of such Right Certificate at the time of surrender) or until it has been
established to the Company's satisfaction that no such tax is due.
(e) It will use its best efforts to (i) file on an
appropriate form, as soon as practicable following the first occurrence of a
Triggering Event, subject to Section 11(a)(iii) hereof in the case of a Flip-in
Event, a registration statement under the Securities Act with respect to the
securities purchasable upon exercise of the Rights, (ii) cause such
registration statement to become effective as soon as practicable after such
filing, and (iii) cause such registration statement to remain effective (with a
prospectus 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. The Company will also take such action
as may be appropriate under, or to ensure compliance with, the securities or
"blue sky" laws of the various states in connection with the exercisability of
the Rights; PROVIDED, HOWEVER, that the Company may temporarily suspend the
exercisability of the Rights in order to prepare and file such registration
statement and permit it to become effective and upon any such suspension, the
Company will give written notice to the Rights Agent and will issue a public
announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as giving such notice and issuing a public announcement at
such time as the suspension is no longer in effect. In addition, if the
Company shall determine that a registration statement is required following the
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Distribution Date, the Company may temporarily suspend the exercisability of
the Rights until such time as a registration statement has been declared
effective.
(f) Notwithstanding anything in this Agreement to the
contrary, the Company covenants and agrees that, after the Final Amendment
Date, it will not, except as permitted by Section 23, Section 25 or Section 27
hereof, take (or permit any Subsidiary to take) any action if at the time such
action is taken it is reasonably foreseeable that such action will diminish or
otherwise eliminate the benefits intended to be afforded by the Rights.
(g) In the event that the Company is obligated to issue
other securities of the Company, pay cash and/or distribute other property
pursuant to Sections 11, 13 or 25 hereof, it will make all arrangements
necessary so that such other securities, cash and/or property are available for
distribution by the Rights Agent, if and when appropriate.
(h) The Company covenants and agrees that it shall not,
at any time after the Distribution Date, directly or indirectly, (i)
consolidate with, or merge with or into, any Person (other than a Subsidiary of
the Company in a transaction which complies with Section 9(f) hereof), or (ii)
sell or otherwise transfer (or permit one or more of its Subsidiary to sell or
otherwise transfer), in one or more transactions, assets or earning power
(including without limitation securities creating any obligation on the part of
the Company and/or any of its Subsidiaries) representing in the aggregate 50%
or more of the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any Person (other than the Company or any Subsidiary of
the Company in a transaction that complies with Section 9(f) hereof), if (x) at
the time of or immediately after such consolidation, merger or sale there are
any rights, warrants or other instruments or securities outstanding which would
substantially diminish or otherwise eliminate the benefits intended to be
afforded by the Rights or (y) prior to, simultaneously with or immediately
after such consolidation, merger or sale, the shareholders of the Person who
constitutes, or would constitute, the Issuer for purposes of Section 13(a)
hereof shall have received a distribution of Rights previously owned by such
Person or any of its Affiliates and Associates.
Section 10. RECORD HOLDERS. Each Person in whose name any
certificate representing shares of Preference Stock II (or Common Shares 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 the
shares of Preference Stock II (or Common Shares 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, if required, payment of the Purchase Price (and all applicable
transfer taxes) was made; PROVIDED, HOWEVER, that if the date of such surrender
and payment is a date upon which the shares of Preference Stock II (or Common
Shares 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 securities on, and such certificate
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<PAGE> 17
shall be dated, the next succeeding Business Day on which the shares of
Preference Stock II (or Common Shares 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, as such, shall not
be entitled to any rights of a shareholder of the Company with respect to
securities for which the Rights shall be exercisable, including without
limitation the right to vote, receive dividends or other distributions or
exercise any preemptive rights, and shall not be entitled pursuant to such
Rights to receive any notice of any proceedings of the Company, except as
provided herein.
Section 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER AND TYPE OF
SHARES OR NUMBER OF RIGHTS. The Purchase Price, the number and kind 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 that the Company shall at any time after the date
of this Agreement (A) declare a dividend on the shares of Preference
Stock II payable in shares of Preference Stock II, (B) subdivide the
outstanding shares of Preference Stock II, (C) combine the outstanding
shares of Preference Stock II into a smaller number of shares or (D)
issue any shares of its capital stock in a reclassification of the
shares of Preference Stock II (including any such reclassification in
connection with a consolidation or merger in which the Company is the
continuing or surviving corporation), 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/or the
number and/or kind of shares of capital stock issuable on such date
upon exercise of a Right, shall be proportionately adjusted so that if
a holder of Rights after such time were to exercise that number of
Rights (or fraction thereof) which would result in the aggregate
amount of the Purchase Price payable upon such exercise (at the
Purchase Price then in effect) being equal to the amount of the
Purchase Price payable prior to such time upon exercise of a Right, he
would be entitled to receive the aggregate number and kind of shares
of capital stock which, if such Right had been exercised immediately
prior to such date and at a time when the shares of Preference Stock
II transfer books of the Company were open, he or she 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) hereof or Section 13 hereof, the
adjustment provided for in this Section 11(a)(i) shall be in addition
to, and shall be made prior to, any adjustment required pursuant to
Section 11(a)(ii) or Section 13 hereof.
(ii) In the event that
(A) any Acquiring Person or any Associate or
Affiliate of any Acquiring Person, at any time after the date
of this Agreement, directly or
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<PAGE> 18
indirectly, shall (1) merge into the Company or otherwise
combine with the Company and the Company shall be the
continuing or surviving corporation of such merger or
combination (other than in a transaction subject to Section 13
hereof), (2) merge or otherwise combine with any Subsidiary of
the Company, (3) in one or more transactions (other than in
connection with the exercise of Rights or the exercise or
conversion of securities exercisable or convertible into
capital stock of the Company or any of its Subsidiaries)
transfer any assets to the Company or any of its Subsidiaries
in exchange (in whole or in part) for shares of any class of
capital stock of the Company or any of its Subsidiaries or for
securities exercisable for or convertible into shares of any
class of capital stock of the Company or any of its
Subsidiaries, or otherwise obtain from the Company or any of
its Subsidiaries, with or without consideration, any
additional shares of any class of capital stock of the Company
or any of its Subsidiaries or securities exercisable for or
convertible into shares of any class of capital stock of the
Company or any of its Subsidiaries (other than as part of a
pro rata distribution to all holders of such shares of any
class of capital stock of the Company, or any of its
Subsidiaries), (4) sell, purchase, lease, exchange, mortgage,
pledge, transfer or otherwise dispose (in one or more
transactions) of any assets (including securities), to, from,
with or of, as the case may be, the Company or any of its
Subsidiaries (other than in a transaction subject to Section
13 hereof), (5) receive any compensation from the Company or
any of its Subsidiaries other than compensation as a director
or for full-time employment as a regular employee, in either
case, at rates in accordance with the Company's (or its
Subsidiaries') past practices, or (6) receive the benefit,
directly or indirectly (except proportionately as a
shareholder), of any loans, advances, guarantees, pledges or
other financial assistance or any tax credits or other tax
advantage provided by the Company or any of its Subsidiaries,
or
(B) during such time as there is an Acquiring
Person, there shall be any reclassification of securities
(including any reverse stock split), or recapitalization of
the Company, or any merger or consolidation of the Company
with any of its Subsidiaries or any other transaction or
series of transactions involving the Company or any of its
Subsidiaries (whether or not with or into or otherwise
involving an Acquiring Person), other than a transaction
subject to Section 13 hereof, which has the effect, directly
or indirectly, of increasing by more than 1% the proportionate
share of the outstanding shares of any class of equity
securities or of securities exercisable for or convertible
into equity securities of the Company or any of its
Subsidiaries of which an Acquiring Person or any Associate or
Affiliate of any Acquiring Person is the Beneficial Owner, or
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(C) any Person (other than the Company or any
Related Person), together with all Affiliates and Associates
of such Person, shall at any time after the date of this
Agreement, become an Acquiring Person, or
(D) any Person shall be declared to be an Adverse
Person by the Directors upon (i) a determination by the
Directors, at any time after the date of this Agreement, that
such Person, alone or together with its Affiliates and
Associates, has become, or has announced an intention to
become, in one or more transactions, the Beneficial Owner of
an amount of Voting Shares which the Directors determine to be
substantial (which amount shall in no event be less than 5% of
the Voting Shares then outstanding) and (ii) a determination
by the Directors after reasonable inquiry and investigation,
including consultation with such persons as such Directors
shall deem appropriate, that such Beneficial Ownership is
causing or may reasonably be anticipated to cause a material
adverse effect (including without limitation impairment of
relationships with customers or impairment of the Company's
ability to maintain its competitive position) on the business,
financial condition or prospects of the Company's government
contracting business; in addition, as to any specific Person,
if the Directors by resolution establish a specific percentage
of the outstanding Voting Shares (which percentage shall in no
event be less than 5% of the Voting Shares then outstanding or
less than or equal to the ownership level of Voting Shares
which such Person has publicly announced that it beneficially
owns as of the date of such resolution), which if beneficially
owned by such Person will result in such Person being an
Adverse Person in accordance with the criteria of the first
sentence of this Section 11(a)(ii)(D) and such Person then
acquires beneficial ownership of such specific percentage,
then, and in each such case, proper provision shall be made so that
upon the Close of Business on the tenth Business Day after the date of
the first occurrence of any event described in Section 11(a)(ii)(A),
(B),(C) or (D) hereof each holder of a Right, except as provided
below, shall thereafter have a right to receive, upon exercise thereof
in accordance with the terms of this Agreement at an exercise price
per Right equal to the product of the then-current Purchase Price
multiplied by the number of one one-hundredths of a share of
Preference Stock II for which a Right was exercisable immediately
prior to the first occurrence of such Flip-in Event, in lieu of shares
of Preference Stock II, such number of Common Shares as shall equal
the result obtained by multiplying the then-current Purchase Price by
the number of one one-hundredths of a share of Preference Stock II for
which a Right was exercisable immediately prior to the first
occurrence of such Flip-in Event, and dividing that product by 50% of
the current per share market price of the Common Shares (determined
pursuant to Section 11(d) hereof) on the date of the first occurrence
of any such Flip-in Event (such number of Common Shares shall
constitute and is
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<PAGE> 20
hereinafter referred to as the "Adjustment Shares"). Notwithstanding
anything in this Agreement to the contrary, from and after the first
occurrence of any such Flip-in Event, any Rights of which any
Acquiring Person or Adverse Person or any Associate or Affiliate of
such Acquiring Person or Adverse Person which the Directors, in their
sole discretion, determine is or was involved in or caused or
facilitated, directly or indirectly (including through any change in
the Directors) such Flip-in Event and is or was at any time the
Beneficial Owner (including any Rights beneficially owned by a
transferee of such Acquiring Person or Adverse Person or any Associate
or Affiliate or any of them who becomes a transferee (i) after such
Acquiring Person or Adverse Person became such or (ii) prior to or
concurrently with such Acquiring Person or Adverse Person having
become such, where such transferee has received such Rights pursuant
to a transfer which the Directors have determined is part of a plan,
arrangement or understanding which has as a primary purpose or effect
the avoidance of this Section 11(a)(ii)) on or after the date upon
which such Acquiring Person or Adverse Person became such shall become
void and any holder of such Rights shall thereafter have no right to
exercise such Rights under any provision of this Agreement.
(iii) In lieu of issuing Common Shares in accordance with the
provision of Section 11(a)(ii) hereof, the Company may, if the
Directors determine that the action described immediately below in
this Section 11(a)(iii) is necessary or appropriate and not contrary
to the interests of the holders of Rights (other than any Acquiring
Person or Adverse Person and any Affiliate or Associate of any such
Person): (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 being hereinafter referred to
as the "Spread"), and (B) with respect to each Right (subject to the
last sentence of Section 11(a)(ii) hereof), make adequate provision to
substitute for the Adjustment Shares, upon the exercise of a Right and
payment of the applicable Purchase Price, (1) cash, (2) a reduction in
the Purchase Price, (3) Common Shares or other equity securities of
the Company (including shares, or units of shares, of preference stock
which the Directors have deemed to have the same value as shares of
Preference Stock II (such shares or units of shares are hereinafter
referred to as "Common Stock Equivalents")), (4) debt securities of
the Company, (5) other assets, or (6) any combination of the
foregoing, having an aggregate value equal to the Current Value, where
such aggregate value has been determined by the Directors based upon
the advice of a nationally recognized investment banking firm selected
by the Directors; PROVIDED, HOWEVER, that if the Company shall not
have made adequate provision to deliver value pursuant to clause (B)
above within 30 days following the later of (x) the first occurrence
of a Flip-in Event and (y) the date on which the Company's right of
redemption pursuant to Section 23(a) expires (the later of (x) and (y)
being hereinafter referred to as the "Flip-in 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, Common
Shares (to the extent
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<PAGE> 21
available) and then, if necessary, cash, which shares and/or cash have
an aggregate value equal to the Spread. To the extent that any legal
or contractual restrictions prevent the Company from paying the full
amount of cash payable in accordance with the foregoing sentence, the
Company shall pay to holders of the Rights as to which such payments
are payable all amounts which are not then restricted on a pro rata
basis and shall continue to make payments on a pro rata basis as funds
become available until the full amount due to each such Right holder
has been paid. In the event that there shall not be sufficient
authorized but unissued Common Shares or authorized and issued Common
Shares held in treasury to permit the exercise in full of the Rights
in accordance with Section 11(a)(ii) hereof, the 30 day period set
forth above may be extended up to 90 days after the Flip-in Trigger
Date, in order that the Company may seek shareholder approval for the
authorization of such additional shares (such period is hereinafter
referred to as the "Substitution Period"). To the extent that action
is to be taken pursuant to the first or second sentence of this
Section 11(a)(iii), the Company (u) shall provide, subject to the last
sentence of Section 11(a)(ii) hereof, that such action shall apply
uniformly to all outstanding Rights, and (v) may suspend the
exercisability of the Rights until the expiration of the Substitution
Period in order to seek such shareholder approval for such
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 will give written notice to the Rights Agent and will issue a
public announcement stating that the exercisability of the Rights has
been temporarily suspended, as well as giving such notice and issuing
a public announcement at such time as the suspension is no longer in
effect. For purposes of this Section 11(a)(iii), the value of a
Common Share shall be the current per share market price per Common
Share on the Flip-in Trigger Date and the per share or per unit value
of any Common Stock Equivalent shall be deemed to equal the current
per share market price per Common Share on such date.
(b) In the event that the Company shall fix a record date
for the issuance of rights, options or warrants to all holders of
shares of Preference Stock II entitling them (for a period expiring
within 45 calendar days after such record date) to subscribe for or
purchase shares of Preference Stock II (or securities having
equivalent rights, privileges and preferences as the shares of
Preference Stock II ("equivalent preferred shares")) or securities
convertible into shares of Preference Stock II or equivalent preferred
shares at a price per share of Preference Stock II or equivalent
preferred share (or having a conversion price per share, if a security
convertible into shares of Preference Stock II or equivalent preferred
shares) less than the current per share market price of the shares of
Preference Stock II (as determined pursuant to Section 11(d) hereof)
on such record date, the Purchase Price to be in effect after such
record date shall be determined by multiplying the Purchase Price in
effect immediately prior to such record date by a fraction, the
numerator of which shall be the number of shares of Preference Stock
II outstanding on such record
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<PAGE> 22
date plus the number of shares of Preference Stock II which the
aggregate offering price of the total number of shares of Preference
Stock II and/or equivalent preferred shares so to be offered (and/or
the aggregate initial conversion price of the convertible securities
so to be offered) would purchase at such current per share market
price and the denominator of which shall be the number of shares of
Preference Stock II outstanding on such record date plus the number of
additional shares of Preference Stock II and/or equivalent preferred
shares to be offered for subscription or purchase (or into which the
convertible securities so to be offered are initially convertible).
In case such subscription price may be paid in a consideration part or
all of which shall be in a form other than cash, the value of such
consideration shall be as determined in good faith by the Directors,
whose determination shall be described in a statement filed with the
Rights Agent and shall be conclusive for all purposes. Shares of
Preference Stock II 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 the event that the Company shall fix a record date
for the making of a distribution to all holders of shares of
Preference Stock II (including any such distribution made in
connection with a consolidation or merger in which the Company is the
continuing or surviving corporation) of evidences of indebtedness,
cash (other than a regular periodic cash dividend at a rate not in
excess of 125% of the rate of the highest regular periodic cash
dividend paid during the immediately preceding two years), assets,
stock (other than a dividend payable in shares of Preference Stock II)
or subscription rights, options or warrants (excluding those referred
to in Section 11(b) hereof), the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price
in effect immediately prior to such record date by a fraction, the
numerator of which shall be the current per share market price of the
shares of Preference Stock II (as determined pursuant to Section 11(d)
hereof) on such record date or, if earlier, the date on which shares
of Preference Stock II begin to trade on an ex-dividend or when-issued
basis with respect to such distribution, less the fair market value
(as determined in good faith by the Directors, whose determination
shall be described in a statement filed with the Rights Agent and
shall be conclusive for all purposes) of the portion of the cash,
assets, stock or evidences of indebtedness so to be distributed (in
the case of periodic cash dividends, only that portion in excess of
125% of the rate of the highest regular periodic cash dividend paid
during the immediately preceding two years) or of such subscription
rights, options or warrants applicable to one share of Preference
Stock II, and the denominator of which shall be such current per share
market price of the shares of Preference Stock II. 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
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<PAGE> 23
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) hereof, the
"current per share market price" of Common Shares on any date shall be
deemed to be the average of the daily closing prices per share of such
Common Shares for the 30 consecutive Trading Days immediately prior to
such date and for purposes of the computation made pursuant to Section
11(a)(iii) hereof, the "current per share market price" on any date
shall be deemed to be the average of the daily closing prices per
share of such Common Shares for the 10 consecutive Trading Days
immediately following such date; PROVIDED, HOWEVER, that in the event
that the current per share market price of the Common Shares is
determined during a period following the announcement by the issuer of
such Common Shares of (A) a dividend or distribution on such Common
Shares payable in such Common Shares or securities convertible into
such Common Shares (other than the Rights) or (B) any subdivision,
combination or reclassification of such Common Shares, and prior to
the expiration of 30 Trading Days after the ex-dividend date for such
dividend or distribution, or the record date for such subdivision,
combination or reclassification, then, and in each such case, the
current per share market price shall be appropriately adjusted to take
into account ex-dividend trading or to reflect the current per share
market price per Common Share equivalent. 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 Common Shares 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 Common Shares are
listed or admitted to trading or, if the Common Shares 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 Common
Shares are not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market
maker making a market in the Common Shares selected by the Directors.
If the Common Shares are not publicly held or not so listed or traded,
or not the subject of available bid and asked quotes, "current per
share market price" shall mean the fair value per share as determined
in good faith by the 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 per share market price" of the shares of Preference Stock II
shall be determined in the
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<PAGE> 24
same manner as set forth above for Common Shares in Section 11(d)(i),
other than the last sentence thereof. If the current per share market
price of the shares of Preference Stock II cannot be determined in the
manner provided above, the current per share market price of the
shares of Preference Stock II shall be conclusively deemed to be an
amount equal to the current per share market price of the Common
Shares multiplied by one hundred (as such number may be appropriately
adjusted to reflect events such as stock splits, stock dividends,
recapitalizations or similar transactions relating to the Common
Shares occurring after the date of this Agreement). If neither the
Common Shares nor the shares of Preference Stock II are publicly held
or so listed or traded, or the subject of available bid and asked
quotes, "current per share market price" of the shares of Preference
Stock II shall mean the fair value per share as determined in good
faith by the Directors, 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 per share
market price of one one-hundredth of a share of Preference Stock II
shall be equal to the current per share market price of one share of
Preference Stock II divided by 100.
(e) Except as set forth in the last sentence of this
Section 11(e), no adjustment in the Purchase Price shall be required
unless such adjustment would require an increase or decrease of at
least 1% in such price; PROVIDED, HOWEVER, that any adjustments which
by reason of this Section 11(e) are not required to be made shall be
carried forward and taken into account in any subsequent adjustment.
All calculations under Section 11 shall be made to the nearest cent or
to the nearest one-thousandth of a Common Share or other share or one
hundred-thousandth of a share of Preference Stock II, as the case may
be. Notwithstanding the first sentence of this Section 11(e), any
adjustment required by Section 11 shall be made no later than the
earlier of (i) three years from the date of the transaction which
requires such adjustment or (ii) the Expiration Date.
(f) If as a result of an adjustment made pursuant to
Section 11(a)(ii) or Section 13(a) hereof, the holder of any Right
thereafter exercised shall become entitled to receive any shares of
capital stock of the Company other than shares of Preference Stock II,
thereafter the number of such other shares so receivable upon exercise
of any Right shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the
provisions with respect to the shares of Preference Stock II contained
in this Section 11 and the provisions of Sections 7, 9, 10, 13 and 14
hereof with respect to the shares of Preference Stock II 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 shares of Preference
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Stock II 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) hereof, upon each adjustment of the
Purchase Price as a result of the calculations made in Section 11(b)
hereof and Section 11(c) hereof made with respect to a distribution of
subscription rights, options or warrants applicable to shares of
Preference Stock II, each Right outstanding immediately prior to the
making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of one
one-hundredths of a share of Preference Stock II (calculated to the
nearest one hundred-thousandth of a share of Preference Stock II)
obtained by (i) multiplying the number of one one-hundredths of a
share of Preference Stock II covered by a Right immediately prior to
this adjustment by the Purchase Price in effect immediately prior to
such adjustment of the Purchase Price and (ii) dividing the product so
obtained by the Purchase Price in effect immediately after such
adjustment of the Purchase Price.
(i) The Company may elect, on or after the date of any
adjustment of the Purchase Price, to adjust the number of Rights in
substitution for any adjustment in the number of shares of Preference
Stock II purchasable upon the exercise of a Right. Each of the Rights
outstanding after such adjustment of the number of Rights shall be
exercisable for the number of one one-hundredths of a share of
Preference Stock II for which a Right was exercisable immediately
prior to such adjustment. Each Right held of record prior to such
adjustment of the number of Rights shall become that number of Rights
(calculated to the nearest one-thousandth) obtained by dividing the
Purchase Price in effect immediately prior to adjustment of the
Purchase Price by the Purchase Price in effect immediately after
adjustment of the Purchase Price. The Company shall make a public
announcement of its election to adjust the number of Rights,
indicating the record date for the adjustment, and, if known at the
time, the amount of the adjustment to be made. This record date may
be the date on which the Purchase Price is adjusted or any day
thereafter, but, if the Right Certificates have been issued, shall be
at least 10 calendar days later than the date of the public
announcement. If Right Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section 11(i), the
Company shall, as promptly as practicable cause to be distributed to
holders of record of Right Certificates on such record date Right
Certificates evidencing, subject to Section 14 hereof, the additional
Rights to which such holders shall be entitled as a result of such
adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and replacement
for the Right Certificates held by such holders prior to the date of
adjustment, and upon surrender thereof if required by the Company, new
Right Certificates evidencing all the Rights to which such holders
shall be entitled after such adjustment. Right Certificates so to be
distributed shall be issued, executed and countersigned in the manner
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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 or kind of shares issuable upon the
exercise of the Rights, the Right Certificates theretofore and
thereafter issued may continue to express the Purchase Price and the
number of shares which were expressed in the initial Right Certificate
issued hereunder.
(k) Before taking any action that would cause an
adjustment reducing the Purchase Price below one one-hundredth of the
then par value, if any, of the shares of Preference Stock II 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 shares of Preference Stock II (or fractions thereof) 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 of the number of shares of
Preference Stock II or other capital stock or securities of the
Company, if any, issuable upon such exercise over and above the number
of shares of Preference Stock II or other capital stock or securities
of the Company, if any, issuable upon such exercise on the basis of
the Purchase Price in effect prior to such adjustment; PROVIDED,
HOWEVER, that the Company shall deliver to such holder a due bill or
other appropriate instrument evidencing such holder's right to receive
such additional shares (fractional or otherwise), of capital stock or
securities upon the occurrence of the event requiring such adjustment.
(m) Notwithstanding anything in this Agreement to the
contrary, 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 the Directors shall determine in their good faith
judgment to be advisable in order that any (i) consolidation or
subdivision of the shares of Preference Stock II, (ii) issuance wholly
for cash of shares of Preference Stock II at less than the current per
share market price therefor, (iii) issuance wholly for cash of shares
of Preference Stock II or securities which by their terms are
convertible into or exchangeable for shares of Preference Stock II,
(iv) stock dividends, or (v) issuance of rights, options or warrants
referred to in this Section 11, hereafter made by the Company to
holders of its shares of Preference Stock II shall not be taxable to
such shareholders.
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(n) Notwithstanding anything in this Agreement to the
contrary, in the event that the Company shall at any time after the
date of this Agreement and prior to the Distribution Date (i) declare
a dividend on the outstanding Common Shares payable in Common Shares,
(ii) subdivide the outstanding Common Shares, (iii) combine the
outstanding Common Shares into a smaller number of shares, or (iv)
issue any shares of its capital stock in a reclassification of the
outstanding Common Shares, the number of Rights associated with each
Common Share then outstanding, or issued or delivered thereafter but
prior to the Distribution Date, shall be proportionately adjusted so
that the number of Rights thereafter associated with each Common Share
following any such event shall equal the result obtained by
multiplying the number of Rights associated with each Common Share
immediately prior to such event by a fraction the numerator of which
shall be the total number of Common Shares outstanding immediately
prior to the occurrence of the event and the denominator of which
shall be the total number of Common Shares outstanding immediately
following the occurrence of such event.
(o) The failure by the Directors to declare a Person to
be an Adverse Person or to establish a specific beneficial ownership
percentage with respect to a specific Person as contemplated by
Section 11(a)(ii)(D) hereof following such Person becoming the
Beneficial Owner of 5% or more of the outstanding Voting Shares shall
not imply that such Person is not an Adverse Person or limit such
Directors' right at any time in the future to declare such Person to
be an Adverse Person or to establish such a specific beneficial
ownership percentage with respect to such specific Person.
Section 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER
OF SHARES. Whenever an adjustment is made as provided in Section 11 or Section
13(a) hereof, the Company shall (a) promptly prepare a certificate setting
forth such adjustment and a brief statement of the facts accounting for such
adjustment, (b) promptly file with the Rights Agent and with each transfer
agent for the Common Shares and the shares of Preference Stock II, a copy of
such certificate, and (c) if such adjustment is made after the Distribution
Date, mail a brief summary of such adjustment to each holder of a Right
Certificate in accordance with Section 26 hereof.
Section 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF
ASSETS OR EARNING POWER.
(a) In the event that, following the Share Acquisition
Date, directly or indirectly,
(i) the Company shall consolidate with, or merge with or
into, any Person (other than a Subsidiary of the Company in a
transaction that complies with Section 9(f) hereof) and the Company
shall not be the continuing or surviving corporation of such
consolidation or merger,
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(ii) any Person (other than a Subsidiary of the Company in a
transaction that complies with Section 9(f) hereof) shall consolidate
with the Company, or merge with or into the Company and the Company
shall be the continuing or surviving corporation of such merger or
consolidation and, in connection with such merger or consolidation,
all or part of the Common Shares shall be changed into or exchanged
for stock or other securities of such other Person or cash or any
other property, or
(iii) the Company shall sell or otherwise transfer (or one or
more of its Subsidiaries shall sell or otherwise transfer), in one or
more transactions, assets or earning power (including without
limitation securities creating any obligation on the part of the
Company and/or any of its Subsidiaries) representing in the aggregate
50% or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any Person (other than the Company
or any Subsidiary of the Company in a transaction that complies with
Section 9(f) hereof),
then, and in each such case, proper provision shall be made so that (A) except
as provided below, upon the Close of Business on the tenth Business Day after
the first occurrence of any event described in Section 13(a)(i), (ii) or (iii)
hereof each holder of a Right shall thereafter have the right to receive, upon
the exercise thereof in accordance with the terms of this Agreement at an
exercise price per Right equal to the product of the then-current Purchase
Price multiplied by the number of one one-hundredths of a share of Preference
Stock II for which a Right is then exercisable, in lieu of shares of Preference
Stock II, such number of validly authorized and issued, fully paid,
nonassessable and freely tradeable Common Shares of the Issuer (as such term is
hereinafter defined), free and clear of any liens, encumbrances and other
adverse claims and not subject to any rights of call or first refusal, as shall
be equal to the result obtained by multiplying the then-current Purchase Price
by the number of one one-hundredths of a share of Preference Stock II for which
a Right is exercisable immediately prior to the first occurrence of any
Flip-over Event (or, if a Flip-in Event has occurred prior to the first
occurrence of a Flip-over Event, multiplying the number of one one-hundredths
of a share of Preference Stock II for which a Right was exercisable immediately
prior to the first occurrence of a Flip-in Event by the Purchase Price in
effect immediately prior to the first occurrence of such Flip-in Event) and
dividing that product by 50% of the current per share market price of the
Common Shares of the Issuer (determined pursuant to Section 11(d) hereof), on
the date of consummation of such Flip-over Event; (B) the Issuer shall
thereafter be liable for, and shall assume, by virtue of such Flip-over Event,
all the obligations and duties of the Company pursuant to this Agreement; (C)
the term "Company" shall thereafter be deemed to refer to the Issuer; and (D)
the Issuer shall take such steps (including without limitation the reservation
of a sufficient number of its Common Shares to permit the exercise of all
outstanding Rights) in connection with such consummation as may be necessary to
assure that the provisions hereof shall thereafter be applicable, as nearly as
reasonably may be possible, in relation to its Common Shares thereafter
deliverable upon the exercise of the Rights. Notwithstanding the
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foregoing, upon the occurrence of any of the events listed above in
subparagraphs (i) through (iii), inclusive, any Rights that are or were at any
time beneficially owned by any Acquiring Person or Adverse Person or any
Affiliate or Associate of such Acquiring Person or Adverse Person including any
Rights beneficially owned by a transferee of such Acquiring Person or Adverse
Person or any Associate or Affiliate of any of them who becomes a transferee
(i) after such Acquiring Person or Adverse Person became such or (ii) prior to
or concurrently with such Acquiring Person or Adverse Person having become
such, where such transferee has received such Rights pursuant to a transfer
which the Directors have determined is part of a plan, arrangement or
understanding which has as a primary purpose or effect the avoidance of this
Section 13(a)) on or after the date upon which such Acquiring Person or Adverse
Person became such, shall become void and any holder of such Rights shall
thereafter have no right to exercise such Rights under this Agreement.
(b) For purposes of this Section 13, "Issuer" shall mean
(i) in the case of any Flip-over Event described in Sections l3(a)(i) or (ii)
above, the Person that is the continuing, surviving resulting or acquiring
Person (including the Company as the continuing or surviving corporation of a
transaction described in Section l3(a)(ii) above), and (ii) in the case of any
Flip-over Event described in Section 13(a)(iii) above, the Person that is the
party receiving the greatest portion of the assets or earning power (including
without limitation securities creating any obligation on the part of the
Company and/or any of its Subsidiaries) transferred pursuant to such
transaction or transactions; PROVIDED, HOWEVER, that, in any such case, (A) if
(1) no class of equity security of such Person is at the time of such merger,
consolidation or transaction, and has been continuously over the preceding
12-month period, registered pursuant to Section 12 of the Exchange Act, and (2)
such Person is a subsidiary directly or indirectly, of another Person, a class
of equity security of which is and has been so registered the term "Issuer"
shall mean such other Person; and (B) in case such Person is a Subsidiary,
directly or indirectly, of more than one Person, a class of equity security of
two or more of which are and have been so registered the term "Issuer" shall
mean whichever of such Persons is the issuer of the equity security having the
greatest aggregate market value. Notwithstanding the foregoing, if the Issuer
in any of the Flip-over Events listed above is not a corporation or other legal
entity having outstanding equity securities, then, and in each such case (i) if
the Issuer is directly or indirectly wholly owned by a corporation or other
legal entity having outstanding equity securities, then all references to
Common Shares of the Issuer shall be deemed to be references to the Common
Shares of the corporation or other legal entity having outstanding equity
securities which ultimately controls the Issuer, and (ii) if there is no such
corporation or other legal entity having outstanding equity securities (Y)
proper provision shall be made so that the Issuer shall create or otherwise
make available for purposes of the exercise of the Rights in accordance with
the terms of this Agreement, a type or types of security or securities having a
fair market value at least equal to the economic value of the Common Shares
which each holder of a Right would have been entitled to receive if the Issuer
had been a corporation or other legal entity having outstanding equity
securities; and (Z) all other
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provisions of this Agreement shall apply to the issuer of such securities as if
such securities were Common Shares.
(c) The Company shall not consummate any Flip-over Event
unless the Issuer shall have a sufficient number of authorized Common Shares
(or other securities as contemplated in Section 13(b) above) which have not
been issued or reserved for issuance to permit the exercise in full of the
Rights in accordance with this Section 13 and unless prior to such consummation
the Company and the Issuer shall have executed and delivered to the Rights
Agent a supplemental agreement providing for the terms set forth in subsections
(a) and (b) of this Section 13 and further providing that as soon as
practicable after the consummation of any Flip-over Event, the Issuer will
(i) prepare and file a registration statement under the
Securities Act, with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form, and
will use its best efforts to cause such registration statement to (A)
become effective as soon as practicable after such filing and (B)
remain effective (with a prospectus at all times meeting the
requirements of the Act) until the Expiration Date; and
(ii) deliver to holders of the Rights historical financial
statements for the Issuer and each of its Affiliates which comply in
all respects with the requirements for registration on Form 10 under
the Exchange Act.
(d) The provisions of this Section 13 shall similarly apply
to successive mergers or consolidations or sales or other transfers. In the
event that a Flip-over Event occurs at any time after the occurrence of a
Flip-in Event, the Rights which have not theretofore been exercised shall
thereafter become exercisable in the manner described in this Section 13.
Section 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES. (a) The
Company shall not be required to issue fractions of Rights or to distribute
Right Certificates which evidence fractional Rights. In lieu of such
fractional Rights, the Company shall pay as promptly as practicable to the
registered holders of the Right Certificates with regard to which such
fractional Rights would otherwise be issuable, an amount in cash equal to the
same fraction of the current market value of a whole Right. For the purposes
of this Section 14(a), the current market value of a whole Right shall be the
closing price of the Rights for the Trading Day immediately prior to the date
on which such fractional Rights would have been otherwise issuable. The
closing price for any day shall be the last sale price, regular way, or, in
case no such sale takes place on such day, the average of the closing bid and
asked prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed or
admitted to trading on the 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
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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 Directors. 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 Directors
shall be used and shall be conclusive for all purposes.
(b) The Company shall not be required to issue fractions
of shares of Preference Stock II (other than fractions which are integral
multiples of one one-hundredth of a share of Preference Stock II) upon exercise
of the Rights or to distribute certificates which evidence fractional shares of
Preference Stock II (other than fractions which are integral multiples of one
one-hundredth of a share of Preference Stock II). Fractions of shares of
Preference Stock II in integral multiples of one one-hundredth of a share of
Preference Stock II may, at the election of the Company, be evidenced by
depositary receipts pursuant to an appropriate agreement between the Company
and a depositary selected by it, provided that such agreement shall provide
that the holders of such depositary receipt shall have all the rights,
Privilege and Preferences to which they are entitled as beneficial owners of
the shares of Preference Stock II represented by such depositary receipts. In
lieu of fractional shares of Preference Stock II that are not integral
multiples of one one-hundredth of a share of Preference Stock II, 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 one-hundredth of a share of Preference Stock
II. For purposes of this Section 14(b), the current market value of one
one-hundredth of a share of Preference Stock II shall be the closing price of
one one-hundredth of a share of Preference Stock II (determined pursuant to
Section 11(d)(ii) hereof) 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 Common Shares upon exercise
of the Rights or to distribute certificates which evidence fractional Common
Shares. In lieu of fractional Common Shares, 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 Common Share. For purposes of this Section 14(c), the
current market value of one Common Share shall be the closing price of a Common
Share (determined pursuant to the second sentence of Section 11(d)(i) hereof)
for the Trading Day immediately prior to the date of such exercise.
Section 15. RIGHTS OF ACTION. All rights of action in
respect of this Agreement, excepting the rights of action given to the Rights
Agent under Section 18 hereof, are vested in the respective registered holders
of the Right Certificates (and,
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prior to the Distribution Date, the registered holders of the Common Shares);
and any registered holder of any Right Certificate (or, prior to the
Distribution Date, of the Common Shares), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Shares), may in 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 or Common Share
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 under this
Agreement, and injunctive relief against actual or threatened violations of the
obligations of any Person subject to this Agreement.
Section 16. AGREEMENT OF RIGHTS HOLDERS. Every holder of a
Right by accepting the same consents and agrees with the Company and the Rights
Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common
Shares;
(b) after the Distribution Date, the Right Certificates
are transferable only on the registry books of the Rights Agent if
surrendered at the principal office of the Rights Agent designated for
such purpose, duly endorsed or accompanied by a proper instrument of
transfer;
(c) subject to Sections 7(d) and 11(a)(ii) 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 Share certificate) is registered as the absolute
owner thereof and of the Rights evidenced thereby (notwithstanding any
notations of ownership or writing on the Right Certificate or the
associated Common Share certificate made by anyone other than the
Company or the Rights Agent) for all purposes whatsoever, and neither
the Company nor the Rights Agent shall be affected by any notice to
the contrary;
(d) the holder expressly waives any right to receive any
fractional rights or any fractional shares upon exercise of a Right,
except as otherwise provided in Section 14 hereof;
(e) 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 to any other Person as a result
of its inability to perform any of its obligations under this
Agreement by reason of any preliminary or permanent injunction or
other order, decree or ruling issued by a court of competent
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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 shall use its best efforts to have any such
order, decree or ruling lifted or otherwise overturned as soon as
possible.
Section 17. RIGHT CERTIFICATE HOLDER NOT DEEMED A
SHAREHOLDER. No holder of any Right Certificate, as such, shall be entitled to
vote, receive dividends or be deemed for any purpose the holder of the shares
of Preference Stock II or any other securities of the Company which may at any
time be issuable upon the exercise of the Rights represented thereby, nor shall
anything contained herein or in any Right Certificate be construed to confer
upon the holder of any Right Certificate, as such, any of the rights of a
shareholder of the Company or any right to vote for the election of Directors
or upon any matter submitted to shareholders at any meeting thereof, or to give
or withhold consent to any corporate action, or to receive notice of meetings
or other actions affecting shareholders (except as provided in Section 24
hereof), or to receive dividends or subscription rights, or otherwise, until
the Right or Rights evidenced by such Right Certificate shall have been
exercised in accordance with the provisions hereof.
Section 18. CONCERNING THE RIGHTS AGENT. (a) The Company
agrees to pay to the Rights Agent reasonable compensation for all services
rendered by it hereunder and, from time to time, on demand of the Rights Agent,
its reasonable expenses and counsel fees and other disbursements incurred in
the administration and execution of this Agreement and the exercise and
performance of its duties hereunder. The Company also agrees to indemnify the
Rights Agent for, and to hold it harmless against, any loss, liability, suit,
action, proceeding or expense, incurred without negligence, bad faith or
willful misconduct on the part of the Rights Agent, for anything done or
omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the costs and expenses of defending
against any claim of liability arising therefrom, directly or indirectly.
(b) The Rights Agent shall be protected and shall incur
no liability for or in respect of any action taken, suffered or omitted by it,
without negligence, bad faith or willful misconduct on its part, in connection
with its administration of this Agreement in reliance upon any Right
Certificate or certificate evidencing shares of Preference Stock Il or other
securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document believed by it to be genuine
and to be signed, executed and, where necessary, verified or acknowledged, by
the proper Person or Persons.
Section 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF
RIGHTS AGENT. (a) Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting
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from any merger or consolidation to which the Rights Agent or any successor
Rights Agent shall be a party, or any corporation succeeding to the corporate
trust business of the Rights Agent or any successor Rights Agent, shall be the
successor to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties
hereto, provided that such corporation would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21 hereof. In case at
the time such successor Rights Agent shall succeed to the agency created by
this Agreement, any of the Right Certificates shall have been countersigned but
not delivered, any such successor Rights Agent may adopt the countersignature
of the predecessor Rights Agent and deliver such Right Certificates so
countersigned; and in case at that time any of the Right Certificates shall not
have been countersigned, any successor Rights Agent may countersign such Right
Certificates in the name of the successor Rights Agent; and in all such cases
such Right Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent
shall be changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Right Certificates so
countersigned; and in case at that time any of the Right Certificates shall not
have been countersigned, the Rights Agent may countersign such Right
Certificates either in its prior name or in its changed name; and in all such
cases such Right Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
Section 20. DUTIES OF RIGHTS AGENT. The Rights Agent
undertakes the duties and obligations imposed by this Agreement upon the
following terms and conditions, by all of which the Company and the holders of
Right Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who
may be legal counsel for the Company), and the opinion of such counsel
shall be full and complete authorization and protection to the Rights
Agent as to any action taken or omitted by it in good faith and in
accordance with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that
any fact or matter be proved or established by the Company prior to
taking or suffering any action hereunder, such fact or matter (unless
other evidence in respect thereof 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 or any Vice President of the Company and delivered to the
Rights Agent; and such certificate shall be full authorization to the
Rights Agent for any action taken or suffered in good faith and
without negligence or willful misconduct by it under the provisions of
this Agreement in reliance upon such certificate.
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(c) The Rights Agent shall be liable hereunder only for
its own negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason
of any of the statements of fact or recitals contained in this
Agreement or in the Right Certificates (except its countersignature
thereof) or be required to verify the same, but all such statements
and recitals are and shall be deemed to have been made by the Company
only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or the
execution and delivery hereof (except the due execution and delivery
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, Section 13 or Section 25 hereof (including
any adjustment which results in Rights becoming void) 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 or
voidance); 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 stock or other securities to be issued pursuant to this
Agreement or any Right Certificate or as to whether any shares of
stock or other securities will, when issued, be validly authorized and
issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts,
instruments and assurances as may reasonably be required by the Rights
Agent for the carrying out or performing by the Rights Agent of the
provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties
hereunder from any one of the Chairman of the Board, the President or
any Vice President of the Company, and to apply to such officers for
advice or instructions in connection with its duties, and it shall not
be liable for any action taken or suffered to be taken by it in good
faith in accordance with instructions of any such officer.
(h) The Rights Agent and any shareholder, Director,
officer or employee of the Rights Agent may buy, sell or deal in any
of the Rights or other securities of the Company or become pecuniarily
interested in any transaction in which the Company may be interested,
or contract with or lend money to the Company or otherwise act as
fully and freely as though it were not Rights Agent
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under this Agreement. Nothing herein shall preclude the Rights Agent
from acting in any other capacity for the Company or for any other
legal entity.
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder
either itself or by or through its attorneys or agents, and the Rights
Agent shall not be answerable or accountable for any act, default,
neglect or misconduct of any such attorneys or agents or for any loss
to the Company resulting from any such act, default, neglect or
misconduct, provided reasonable care was exercised in the selection
and continued employment thereof.
(j) If, with respect to any Right Certificate surrendered
to the Rights Agent for exercise or transfer, the certificate attached
to the form of assignment or form of election to purchase, as the case
may be, has either not been completed or indicates an affirmative
response to clause 1 or 2 thereof, the Rights Agent shall not take any
further action with respect to such requested exercise or transfer
without first consulting with the Company.
Section 21. CHANGE OF RIGHTS AGENT. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties under this
Agreement upon 30 days' notice in writing mailed to the Company and to each
transfer agent of the Common Shares and shares of Preference Stock II by
registered or certified mail, and to the holders of the Right Certificates by
first-class mail. The Company may remove the Rights Agent or any successor
Rights Agent upon 30 days' notice in writing, mailed to the Rights Agent or
successor Rights Agent, as the case may be, and to each transfer agent of the
Common Shares and shares of Preference Stock II by registered or certified
mail, and to the holders of the Right Certificates by first-class mail. If the
Rights Agent shall resign or be removed or shall otherwise become incapable of
acting, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of 30 days after
giving notice of such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights Agent or by
the holder of a Right Certificate (who shall, with such notice, submit his
Right Certificate for inspection by the Company), then the registered holder of
any Right Certificate may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor Rights Agent, whether
appointed by the Company or by such a court, shall be a corporation organized
and doing business under the laws of the United States or of the State of Ohio
(or of any other state of the United States so long as such corporation is
authorized to do business as a banking institution in the State of Ohio), in
good standing, having a principal office in the State of Ohio, which is
authorized under such laws to exercise corporate trust powers and is subject to
supervision or examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined capital and surplus of at
least $50 million and which shall otherwise meet any requirements imposed by
the New York Stock Exchange on transfer agents and registrars. After
appointment, the successor Rights Agent shall be vested with the same powers,
rights, duties and
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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 any property thereafter sent to it in the belief that it
continues to act as Rights Agent, and execute and deliver any further
assurance, conveyance, act or deed necessary for the purpose. Not later than
the effective date of any such appointment, the Company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Shares and shares of Preference Stock II, and mail a notice thereof
in writing to the registered holders of the Right Certificates. Failure to
give any notice provided for in this Section 21, however, or any defect
therein, shall not affect the legality or validity of the resignation or
removal of the Rights Agent or the appointment of the successor Rights Agent,
as the case may be.
Section 22. ISSUANCE OF NEW RIGHT CERTIFICATES.
Notwithstanding any of the provisions of this Agreement or of the Rights to the
contrary, the Company may, at its option, issue new Right Certificates
evidencing Rights in such form as may be approved by its Directors to reflect
any adjustment or change in the Purchase Price per share and the number or kind
or class of shares or other securities or property purchasable under the Right
Certificates made in accordance with the provisions of this Agreement. In
addition, in connection with the issuance or sale of Common Shares following
the Distribution Date (other than upon exercise of a Right) and prior to the
Expiration Date, the Company (a) shall, with respect to Common Shares so issued
or sold pursuant to the exercise of stock options granted by the Company prior
to the Distribution Date or under any employee plan or arrangement entered into
prior to the Distribution Date, or upon the exercise, conversion or exchange of
securities issued by the Company prior to the Distribution Date, and (b) may,
in any other case, if deemed necessary or appropriate by the Directors, issue
Right Certificates representing the appropriate number of Rights in connection
with such issuance or sale; PROVIDED, HOWEVER, that (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 shall 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 23. REDEMPTION. (a) The Directors may, at their
option, redeem all but not less than all of the then-outstanding Rights at the
Redemption Price at any time prior to the earlier of (i) the Close of Business
on the tenth Business Day after the occurrence of a Triggering Event or (ii)
the Final Expiration Date; PROVIDED, HOWEVER, that the Directors may not redeem
after they declare any Person to be an Adverse Person in accordance with
Section 11(a)(ii)(D) hereof. Notwithstanding anything contained in this
Agreement to the contrary, the Rights shall not be exercisable after the first
occurrence of a Flip-in Event until such time as the Company's right of
redemption set forth in this Section 23(a) has expired.
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(b) Immediately upon the effective date of the action of
the Directors 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. Promptly after the action of the Directors ordering the
redemption of the Rights, the Company shall publicly announce such action, and
the Company shall give notice of such redemption to the holders of the
then-outstanding Rights by mailing such notice to all such holders at their
last addresses as they appear upon the registry books of the Rights Agent or,
prior to the Distribution Date, on the registry books of the transfer agent for
the Common Shares. Any notice which is mailed in the manner herein provided
shall be deemed given, whether or not the holder receives the notice. Each
such notice of redemption will state the method by which the payment of the
Redemption Price will be made. The Company may, at its option, pay the
Redemption Price in cash, Common Shares (based upon the current per share
market price of the Common Shares (determined pursuant to Section 11(d) hereof)
at the time of redemption) or any other form of consideration deemed
appropriate by the Directors.
(c) At any time, a majority of the Directors, which
majority shall include a majority of the Directors who are not representatives,
nominees, Affiliates or Associates of an Acquiring Person or an Adverse Person,
may relinquish any or all of the rights to redeem the Rights under Section
23(a) hereof by duly adopting a resolution to that effect. Promptly after
adoption of such a resolution, the Company shall publicly announce such action.
Immediately upon adoption of such resolution, the rights of the Directors under
the portions of this Section 23 specified in such resolution shall terminate
without further action and without any notice.
Section 24. NOTICE OF CERTAIN EVENTS. (a) In case, after the
Distribution Date, the Company shall propose (i) to pay any dividend payable in
stock of any class to the holders of shares of Preference Stock II or to make
any other distribution to the holders of shares of Preference Stock II (other
than a regular periodic cash dividend at a rate not in excess of 125% of the
rate of the highest regular periodic cash dividend paid during the immediately
preceding two years), (ii) to offer to the holders of shares of Preference
Stock II rights, options or warrants to subscribe for or to purchase any
additional shares of Preference Stock II or shares of stock of any class or any
other securities, rights or options, (iii) to effect any reclassification of
its shares of Preference Stock II (other than a reclassification involving only
the subdivision of outstanding shares of Preference Stock II), (iv) to effect
any consolidation or merger into or with, or to effect any sale or other
transfer (or to permit one or more of its Subsidiaries to effect any sale or
other transfer), in one or more transactions, of assets or earning power
(including without limitation securities creating any obligation on the part of
the Company and/or any of its Subsidiaries) representing more than 50% of the
assets and earning power of the Company and its Subsidiaries, taken as a whole,
to any other Person or Persons, or (v) to effect the liquidation, dissolution
or winding up of the Company, then, in each such case, the Company shall give
to each holder of a Right Certificate, in accordance with Section 26 hereof, a
notice of such proposed action, which shall specify the record date for the
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purposes of such stock dividend, distribution or offering of rights, options or
warrants, or the date on which such reclassification, consolidation, merger,
sale, transfer, liquidation, dissolution, or winding up is to take place and
the date of participation therein by the holders of the shares of Preference
Stock II, if any such date is to be fixed, and such notice shall be so given,
in the case of any action covered by clause (i) or (ii) above, at least 20
calendar days prior to the record date for determining holders of the shares of
Preference Stock II for purposes of such action, and, in the case of any such
other action, at least 20 calendar days prior to the date of the taking of such
proposed action or the date of participation therein by the holders of the
shares of Preference Stock II, whichever shall be the earlier.
(b) In case any Triggering Event shall occur, then, in
each such case, the Company shall as soon as practicable thereafter give to the
Rights Agent and each holder of a Right Certificate, in accordance with Section
26 hereof, a notice of the occurrence of such event, which shall specify the
event and the consequences of the event to holders of Rights.
Section 25. EXCHANGE. (a) The Directors may, in their
discretion, at any time after the date of the occurrence of a Triggering 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 11(a)(ii) hereof) for Common Shares at an exchange ratio of one Common
Share per Right, appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof (such exchange
ratio is hereinafter referred to as the "Exchange Ratio"). Notwithstanding the
foregoing, the Directors shall not be empowered to effect such exchange at any
time after any Person (other than the Company or any Related Person), together
with all Affiliates and Associates of such Person, becomes the Beneficial Owner
of 50% or more of the Common Shares then outstanding.
(b) Immediately upon the action of the Directors ordering
the exchange of any Rights, 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 Common
Shares equal to the number of such Rights held by such holder multiplied by the
Exchange Ratio. The Company shall promptly issue a public announcement of any
such exchange; PROVIDED, HOWEVER, that the failure to give, or any defect in,
such public announcement shall not affect the validity of such exchange. The
Company promptly shall mail a notice of any such exchange to all holders of
such Rights at their last addresses as they appear upon the registry books of
the Rights Agent. Any notice which is mailed in the manner herein provided
shall be deemed given, whether or not the holder receives the notice. Each
such notice of exchange will state the method by which the exchange of the
Common Shares 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 void pursuant to the provisions of Section 11(a)(ii) hereof)
held by each holder of Rights.
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(c) In the event that there shall not be sufficient
authorized but unissued Common Shares or authorized and issued Common Shares
held in treasury to permit any exchange of Rights as contemplated in accordance
with this Section 25, the Company shall take all such action as may be
necessary to authorize additional Common Shares for issuance upon exchange of
the Rights. In the event the Company shall, after good faith effort, be unable
to take all such action as may be necessary to authorize such additional Common
Shares, the Company shall substitute, for each Common Share that would
otherwise be issuable upon exchange of a Right, a number of shares of
Preference Stock II or fraction thereof such that the current per share market
price of one share of Preference Stock II multiplied by such number or fraction
is equal to the current per share market price of one Common Share as of the
date of issuance of such shares of Preference Stock II or fraction thereof.
(d) The Company shall not be required to issue fractions
of Common Shares or to distribute certificates which evidence fractional Common
Shares. In lieu of such fractional Common Shares, the Company shall pay as
promptly as practicable to the registered holders of the Right Certificates
with regard to which such fractional Common Shares would otherwise be issuable,
an amount in cash equal to the same fraction of the current market value of a
whole Common Share. For the purposes of this Section 25(d), the current market
value of a whole Common Share shall be the closing price of a Common Share (as
determined pursuant to the second sentence of Section 11(d)(i) hereof) for the
Trading Day immediately prior to the date of exchange pursuant to this Section
25.
Section 26. NOTICES. (a) Notices or demands authorized by
this Agreement to be given or made by the Rights Agent or by the holder of any
Right Certificate to or on the Company shall be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed (until another address is
filed in writing with the Rights Agent) as follows:
TRW Inc.
1900 Richmond Road
Cleveland, Ohio 44124
Attention: Secretary
(b) Subject to the provisions of Section 21 hereof, any
notice or demand authorized by this Agreement to be given or made by the
Company or by the holder of any Right Certificate to or on the Rights Agent
shall be sufficiently given or made if sent by first-class mail, postage
prepaid addressed (until another address is filed in writing with the Company)
as follows:
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<PAGE> 41
National City Bank
Corporate Trust Department
1900 East Ninth Street
Cleveland, Ohio 44114
Attention: Sherry L. DaMore
(c) Notices or demands authorized by this Agreement to be
given or made by the Company or the Rights Agent to or on the holder of any
Right Certificate shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed to such holder at the address of such holder
as shown on the registry books of the Rights Agent.
Section 27. SUPPLEMENTS AND AMENDMENTS. The Company may from
time to time supplement or amend this Agreement without the approval of any
holders of Rights in order to cure any ambiguity, to correct or supplement any
provision of this Agreement (or any exhibit hereto) which may be defective or
inconsistent with any other provisions herein, or to make any other provisions
with respect to the Rights which the Company may deem necessary or desirable,
any such supplement or amendment to be evidenced by a writing signed by the
Company and the Rights Agent; PROVIDED, HOWEVER, that from and after the Final
Amendment Date, this Agreement shall not be amended in any manner which would
adversely affect the interests of the holders of Rights. Without limiting the
foregoing, the Company may at any time prior to the Final Amendment Date amend
this Agreement to lower the thresholds set forth in Sections 1(a) and 1(i) to
not less than the greater of (i) the sum of .001% and the largest percentage of
the outstanding Common Shares then known by the Company to be beneficially
owned by any Person (other than the Company or any Related Person) or (ii) 10%.
Section 28. SUCCESSORS; CERTAIN COVENANTS. All the covenants
and provisions of this Agreement by or for the benefit of the Company or the
Rights Agent shall bind and inure to the benefit of their respective successors
and assigns hereunder.
Section 29. BENEFITS OF THIS AGREEMENT. Nothing in this
Agreement shall be construed to give to any Person other than the Company, the
Rights Agent and the registered holders of the Right Certificates (and, prior
to the Distribution Date, the Common Shares) any legal or equitable right,
remedy or claim under this Agreement; this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the registered holders
of the Right Certificates (or prior to the Distribution Date, the Common
Shares). The Rights Agent is the agent of the Company and not of the holders
of the Right Certificates.
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
-38-
<PAGE> 42
be affected, impaired or invalidated; PROVIDED, HOWEVER, that 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 Directors determine in their 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 23 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
Directors. Without limiting the foregoing, if any provision requiring a
majority of the Directors who are not representatives, nominees, Affiliates or
Associates of an Acquiring Person to act is held by any court of competent
jurisdiction to be invalid, void or unenforceable, such authority shall be made
by the Directors in accordance with applicable law and the Company's Articles
of Incorporation and Regulations.
Section 31. GOVERNING LAW. This Agreement and each Right
Certificate issued hereunder shall be deemed to be a contract made under the
internal substantive laws of the State of Ohio and for all purposes shall be
governed by and construed in accordance with the internal substantive laws of
such State applicable to contracts to be made and performed entirely within
such State.
Section 32. COUNTERPARTS. This Agreement may be executed in
any number of counterparts and each of such counterparts shall for all purposes
be deemed to be an original, and all such counterparts shall together
constitute but one and the same instrument.
Section 33. DESCRIPTIVE HEADINGS. Descriptive headings of
the several Sections of this Agreement are inserted for convenience only and
shall not control or affect the meaning or construction of any of the
provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and attested, all as of the day and year first
above written.
TRW INC.
Attest:
By /s/ Jean M. Schmidt By /s/ Martin A. Coyle
-------------------------- -------------------------
Name: Jean M. Schmidt Name: Martin A. Coyle
Title: Assistant Secretary Title: Executive Vice
President
NATIONAL CITY BANK
Attest:
By /s/ Houston E. Cockrell By /s/ Sherry L. DaMore
-------------------------- -------------------------
Name: Houston E. Cockrell Name: Sherry L. DaMore
Title: Senior Vice President Title: Vice President
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<PAGE> 43
EXHIBIT A
FORM OF
CERTIFICATE OF ADOPTION OF
AMENDED ARTICLES OF INCORPORATION
OF
TRW INC.
We, Martin A. Coyle, an Executive Vice President, and Jean M. Schmidt,
an Assistant Secretary, of TRW Inc., an Ohio corporation (the "Corporation"),
do hereby certify that, pursuant to Section 1701.70(B)(1) of the Ohio Revised
Code and the authority conferred by the Corporation's Amended Articles of
Incorporation (the "Amended Articles"), the Directors of the Corporation, at a
meeting thereof duly called and held on April 24, 1996, at which meeting a
quorum was present and acting throughout, adopted the following resolutions to
further amend the Corporation's Amended Articles and that such Amended Articles
are attached to this Certificate as Exhibit A:
RESOLVED that the Corporation's Amended Articles of Incorporation be
further amended with respect to Section 4 and Section 5(a) of Division
C-4 of Article Fourth to reflect the revised Shareholder Rights Plan,
as follows:
SECTION 4. Redemption Rights. Subject to the provisions of
Section 6(b)(iii) of Division C of Article Fourth thereof and in
accordance with the provisions of Section 4 of Division C of
Article Fourth hereof, the shares of Series 4 shall be redeemable
from time to time at the option of the Directors of the
Corporation, as a whole or in part, at any time, at a redemption
price per share equal to 100 times the then applicable Purchase
Price as defined in that certain rights agreement, dated as of
April 24, 1996 between the corporation and its rights agent (the
"Rights Agreement"), as the same may be amended from time to time
in accordance with its terms, subject to adjustment from time to
time as provided in the Rights Agreement. Copies of the Rights
Agreement are available from the Corporation upon request. In the
event less than all of the outstanding shares of Series 4 are to
be redeemed, the Corporation shall select by lot the shares so to
be redeemed in such manner as shall be prescribed by the Directors
of the Corporation.
A-1
<PAGE> 44
SECTION 5. Liquidation Rights.
(a) In the event of any voluntary or involuntary
liquidation, dissolution or winding up of the affairs of the
Corporation (hereinafter referred to as a "Liquidation"), no
distribution shall be made to the holders of shares of stock
ranking junior (either as to dividends or upon Liquidation) to the
shares of Series 4, unless, prior thereto, the holders of shares
of Series 4 shall have received at least an amount per share equal
to 100 times the then applicable Purchase Price as defined in the
Rights Agreement, as the same may be amended from time to time in
accordance with its terms, subject to adjustment from time to time
as provided in the Rights Agreement, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or
not earned or declared, to the date of such payment, provided that
the holders of shares of Series 4 shall be entitled to receive at
least an aggregate amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 100 times the aggregate
amount to be distributed per share to holders of shares of Common
Stock (the "Series 4 Liquidation Preference");
FURTHER RESOLVED that (i) the amended and restated Articles of
Incorporation of the Corporation, in the form presented to this
meeting be, and they hereby are, adopted as the Corporation's Amended
Articles of Incorporation (the "Amended Articles") and (ii) a copy of
the Amended Articles is ordered filed as Exhibit ___ to the minutes of
this meeting;
FURTHER RESOLVED that any officer or assistant officer of the
Corporation is authorized and empowered, for and on behalf of the
Corporation, to execute such documents and to take such other actions
in connection with the adoption of such Amended Articles, including,
but not limited to, the filing thereof in any jurisdiction where such
filing is required, as such person shall deem necessary and
appropriate; and
A-2
<PAGE> 45
FURTHER RESOLVED that if, in connection with the adoption of the
Amended Articles pursuant to the foregoing resolutions, any particular
form of resolution or resolutions is required, such resolution or
resolutions shall be deemed adopted hereby when certified by the
Secretary (or any Assistant Secretary) of the Corporation; provided,
however, that such resolutions do not exceed or contradict the
authorities granted pursuant to the foregoing resolutions.
IN WITNESS WHEREOF, Martin A. Coyle, an Executive Vice President, and
Jean M. Schmidt, an Assistant Secretary, of TRW Inc., acting for and on behalf
of the Corporation, have hereunto subscribed their names this 24th day of
April, 1996.
___________________________________________
Executive Vice President
___________________________________________
Assistant Secretary
A-3
<PAGE> 46
Exhibit B
---------
[Form of Right Certificate]
Certificate No. R- __________ Rights
NOT EXERCISABLE AFTER APRIL 24, 2006 OR EARLIER IF REDEEMED BY
THE COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE
OPTION OF THE COMPANY, AT $.01 PER RIGHT ON THE TERMS SET
FORTH IN THE RIGHTS AGREEMENT. [THE RIGHTS REPRESENTED BY
THIS RIGHT CERTIFICATE ARE OR WERE ISSUED TO, OR BENEFICIALLY
OWNED BY, A PERSON WHO WAS AN ACQUIRING PERSON OR AN ADVERSE
PERSON OR AN AFFILIATE OR AN ASSOCIATE OF AN ACQUIRING PERSON
OR AN ADVERSE PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT). THIS RIGHT CERTIFICATE AND THE RIGHTS REPRESENTED
HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED
IN THE RIGHTS AGREEMENT.]*
Right Certificate
TRW INC.
This certifies that ____________________, or registered
assigns, is the registered owner of the number of Rights set forth above, each
of which entitles the owner thereof, subject to the terms, provisions and
conditions of the Rights Agreement, dated as of April 24, 1996 (the "Rights
Agreement"), between TRW Inc., an
__________________________________
* The portion of the legend in brackets shall be inserted only if
applicable.
B-1
<PAGE> 47
Ohio corporation (the "Company"), and National City Bank, a national banking
association (the "Rights Agent"), to purchase from the Company at any time
after the Distribution Date (as such term is defined in the Rights Agreement)
and prior to 5:00 p.m. (Cleveland, Ohio time) on April 24, 2006 at the
principal office of the Rights Agent, in Cleveland, Ohio or its successor as
Rights Agent, one one-hundredth of a fully paid nonassessable share of the
Cumulative Redeemable Preference Stock II, Series 4, without par value (the
"Preference Stock II"), of the Company, at a purchase price of $300 per one
one-hundredth of a share of Preference Stock II (the "Purchase Price"), upon
presentation and surrender of this Right Certificate with the Form of Election
to Purchase duly executed. The number of Rights evidenced by this Right
Certificate (and the number of shares of Preference Stock II which may be
purchased upon exercise thereof) set forth above, and the Purchase Price per
one one-hundredth of a share of Preference Stock II set forth above, are the
number and Purchase Price as of April 24, 1996. No Right is exercisable at any
time prior to the Distribution Date.
As provided in the Rights Agreement, the Purchase Price and
the number and type of 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, and the Rights are subject to
amendment, redemption and certain other events, including Triggering Events (as
such term is defined in the Rights Agreement).
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
B-2
<PAGE> 48
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.
This Right Certificate, with or without other Right
Certificates, upon surrender at the principal office of the Rights Agent in
Cleveland, Ohio, 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 shares of Preference Stock II as the Rights
evidenced by the Right Certificate or Right Certificates 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 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 (unless the Directors have declared any
Person to be an Adverse Person (as such terms are defined in the Rights
Agreement) in accordance with the Rights Agreement) be redeemed by the Company
at its option at a redemption price of $.01 per Right, at any time prior to the
earlier of (i) the Close of Business on the tenth day after the occurrence of a
Triggering Event or (ii) the Final Expiration Date (as such terms are defined
in the Rights Agreement).
B-3
<PAGE> 49
Subject to the provisions of the Rights Agreement, at the
election of the Directors of the Company, the Rights evidenced by this
Certificate may, at any time after the date of the occurrence of a Triggering
Event but before any Person, together with its Affiliates and Associates,
becomes the Beneficial Owner of 50% or more of the then outstanding Common
Shares (as such terms are defined in the Rights Agreement), be exchanged in
whole or in part for Common Shares.
No fractional shares of Preference Stock II will be issued
upon the exercise of any Right or Rights evidenced hereby (other than fractions
which are integral multiples of one one-hundredth of a share of Preference
Stock II, which may, at the election of the Company, be evidenced by depositary
receipts), but in lieu thereof a cash payment will be made, as provided in the
Rights Agreement.
No holder of this Right Certificate, as such, shall be
entitled to vote or receive dividends or be deemed for any purpose the holder
of the shares of Preference Stock II or of any other securities of the Company
which may at any time be issuable on the exercise of the Right or Rights
represented hereby, nor shall anything contained herein or in the Rights
Agreement be construed to confer upon the holder hereof, as such, any of the
rights of a shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting shareholders (except as provided in the
Rights Agreement), or to receive dividends or subscription rights, or
otherwise, until the Right or Rights evidenced by this Right Certificate shall
have been exercised as provided in the Rights Agreement.
B-4
<PAGE> 50
This Right Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal. Dated as of [the issuance date].
ATTEST: TRW INC.
___________________________ By _________________________
Secretary Title:
Countersigned:
By ________________________
Authorized Signature
B-5
<PAGE> 51
[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
Signature Guaranteed:
B-6
<PAGE> 52
CERTIFICATE
-----------
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Right Certificate [ ]
are [ ] are not being sold, assigned or transferred by or on behalf of a
Person who is or was an Acquiring Person or an Adverse Person or an Affiliate
or Associate of any such 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 Adverse Person or an Affiliate or Associate of any such
Person.
Dated: ______________ , ____
________________________________________
Signature
Signature Guaranteed:
NOTICE
------
The signatures 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-7
<PAGE> 53
FORM OF ELECTION TO PURCHASE
----------------------------
(To be executed if holder desires to
exercise the Right Certificate)
To TRW Inc.:
The undersigned hereby irrevocably elects to exercise
________________ Rights represented by this Right Certificate to purchase the
shares of Preference Stock II issuable upon the exercise of such Rights (or
such other securities of the Company or any other person, or cash or other
property of the Company, which may become issuable upon the exercise of the
Rights) and requests that certificates for such shares be issued in the name of
and delivered to:
________________________________________________________________________________
(Please print name and address)
________________________________________________________________________________
Please insert social security
or other identifying number: ______________
If such number of Rights shall not be all the Rights evidenced by this
Right Certificate, a new Right Certificate for the balance remaining of such
Rights shall be registered in the name of and delivered to:
________________________________________________________________________________
(Please print name and address)
________________________________________________________________________________
Please insert social security
or other identifying number: ______________
Dated: ________________, ____
_______________________________________
Signature
(Signature must conform in all respects
to name of holder as specified on the
face of this Right Certificate)
Signature Guaranteed:
<PAGE> 54
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 Adverse Person or an Affiliate or Associate of any such
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 Adverse Person or an Affiliate or Associate of any such
Person.
Dated: ______________ , ____
________________________________________
Signature
Signature Guaranteed:
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.
