SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A/A
AMENDMENT NO. 1
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
LEXMARK INTERNATIONAL GROUP, INC.
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(Exact name of registrant as specified in its charter)
Delaware 22-3074422
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(State of incorporation or organization) .R.S. Employer Identification No.)
One Lexmark Centre Drive
740 West New Circle Road
Lexington, Kentucky 40550
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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
------------------- ------------------------------
Preferred Stock New York Stock Exchange, Inc.
Purchase Rights
Securities to be registered pursuant to Section 12(g) of the Act:
None
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(Title of class)
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Item 1. Description of Registrant's Securities to Be Registered.
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On February 11, 1999, the Board of Directors of Lexmark
International Group, Inc. (the "Company") amended and restated its Rights
Agreement dated as of February 18, 1998 between the Company and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent (as amended and restated, the
"Amended and Restated Rights Agreement"). Capitalized terms used without
definition herein shall have the meanings ascribed to such terms in the Amended
and Restated Rights Agreement.
The amendments contained in the Amended and Restated Rights
Agreement consist of the following: (i) the Final Expiration Date has been
extended from January 31, 2008 to January 31, 2009; (ii) each Right has been
modified to entitle the registered holder thereof to purchase from the Company
one one-thousandth, rather than one one-hundredth, of a share of Preferred
Stock; (iii) the term Continuing Director has been deleted from the Amended and
Restated Rights Agreement and, consistent therewith, all references to
Continuing Director decision-making have been removed from the Amended and
Restated Rights Agreement, such decision-making now being vested in a majority
of the Independent Directors; and (iv) the definition of an Independent Director
has been amended to mean, with respect to any transaction or series of
transactions, a member of the Board of Directors of the Company other than a
director who has a relationship that would interfere with the exercise of
independent judgment in carrying out the responsibilities of a director or a
financial interest in or with respect to such transaction or series of
transactions. The foregoing summary does not purport to be complete and is
qualified in its entirety by reference to the full text of the Amended and
Restated Rights Agreement filed herewith as Exhibit 1, which Exhibit is hereby
incorporated herein by reference.
Item 2. Exhibits
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1 Amended and Restated Rights Agreement, dated as of
February 11, 1999, between Lexmark International
Group, Inc. and ChaseMellon Shareholder Services,
L.L.C., as Rights Agent.
2
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SIGNATURE
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, thereunto duly authorized.
Dated: February 11,1999
LEXMARK INTERNATIONAL GROUP, INC.
By: /s/ Gary E. Morin
----------------------------
Name: Gary E. Morin
Title: Vice President and Chief
Financial Officer
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EXHIBIT INDEX
Number Description
- ------ -----------
1 Amended and Restated Rights Agreement, dated as of February
11, 1999, between Lexmark International Group, Inc. and
ChaseMellon Shareholder Services, L.L.C., as Rights Agent.
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===============================================================================
LEXMARK INTERNATIONAL GROUP, INC.
and
CHASEMELLON SHAREHOLDER SERVICES, L.L.C., as Rights Agent
AMENDED AND RESTATED RIGHTS AGREEMENT
Dated as of
February 11, 1999
================================================================================
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TABLE OF CONTENTS
Page
Section 1. Certain Definitions.............................................1
Section 2. Appointment of Rights Agent.....................................8
Section 3. Issue of Right Certificates.....................................8
Section 4. Form of Right Certificates......................................10
Section 5. Countersignature and Registration...............................11
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen
Right Certificates............................................12
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights...13
Section 8. Cancellation and Destruction of Right Certificates..............16
Section 9. Reservation and Availability of Shares of Capital Stock.........16
Section 10. Preferred Stock Record Date.....................................19
Section 11. Adjustment of Purchase Price, Number of Shares or
Number of Rights..............................................19
Section 12. Certificate of Adjusted Purchase Price or Number of Shares......30
Section 13. Consolidation, Merger or Sale or Transfer of Assets
or Earning Power..............................................30
Section 14. Fractional Rights and Fractional Shares.........................33
Section 15. Rights of Action................................................34
Section 16. Agreement of Right Holders......................................35
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Page
Section 17. Right Certificate Holder Not Deemed a Stockholder...............36
Section 18. Concerning the Rights Agent.....................................36
Section 19. Merger or Consolidation or Change of Name of Rights Agent.......37
Section 20. Duties of Rights Agent..........................................38
Section 21. Change of Rights Agent..........................................41
Section 22. Issuance of New Right Certificates..............................42
Section 23. Redemption and Termination......................................42
Section 24. Exchange........................................................44
Section 25. Notice of Certain Events........................................45
Section 26. Notices.........................................................46
Section 27. Supplements and Amendments......................................47
Section 28. Successors .....................................................48
Section 29. Determinations and Actions by the Board of Directors............48
Section 30. Benefits of this Agreement......................................49
Section 31. Severability ...................................................49
Section 32. Governing Law ..................................................49
Section 33. Counterparts .................................................. 49
Section 34. Descriptive Headings............................................50
EXHIBIT A Amended Certificate of Designation.............................A-1
EXHIBIT B Form of Right Certificate......................................B-1
EXHIBIT C Summary of Rights to Purchase Preferred Stock..................C-1
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AMENDED AND RESTATED RIGHTS AGREEMENT
-------------------------------------
Amended and Restated Rights Agreement, originally dated as of
February 18, 1998, and amended and restated as of February 11, 1999,
between Lexmark International Group, Inc., a Delaware corporation
(the "Company"), and ChaseMellon Shareholder Services, L.L.C., a New Jersey
limited liability company (the "Rights Agent").
W I T N E S S E T H :
- - - - - - - - - -
WHEREAS, the Board of Directors of the Company on February 18,
1998 (the "Rights Dividend Declaration Date") authorized and declared a dividend
distribution (the "Distribution") of one Right for each outstanding share of the
Class A Common Stock, par value $0.01 per share, and Class B Common Stock, par
value $0.01 per share, of the Company (collectively, the "Common Stock")
outstanding at the close of business on April 3, 1998 (the "Record Date") and
has authorized and directed the issuance of one Right (as such number may
hereinafter be adjusted pursuant to the provisions of Section 11(p) hereof) in
respect of each share of Common Stock issued (whether originally issued or
delivered from the Company's treasury stock) between the Record Date and the
earlier of the Distribution Date or the Expiration Date (as such terms are
hereinafter defined), each Right initially representing the right to purchase,
under certain circumstances, one one-thousandth of a share of Series A Junior
Participating Preferred Stock of the Company having the rights, powers and
preferences set forth in the Certificate of Designation attached hereto as
Exhibit A, upon the terms and subject to the conditions hereinafter set forth
(the "Rights"); and
WHEREAS, the Company and the Rights Agent desire to amend this
Agreement, in accordance with Section 27 hereof, on the terms and subject to the
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this
-------------------
Agreement, the following terms have the meanings indicated:
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(a) "Acquiring Person" shall mean any Person (as such term is
hereinafter defined) who or which, together with all Affiliates (as
such term is hereinafter defined) and Associates (as such term is
hereinafter defined) of such Person, shall be the Beneficial Owner (as
such term is hereinafter defined) of securities of the Company
constituting a Substantial Block (as such term is hereinafter defined),
but shall not include (i) the Company, any Subsidiary of the Company,
any employee benefit plan of the Company or of any Subsidiary of the
Company or any Person organized, appointed or established by the
Company or any Subsidiary of the Company for or pursuant to the terms
of any such plan; (ii) any Person who or which, together with all
Affiliates and Associates of such Person, becomes the Beneficial Owner
of a Substantial Block solely as a result of a change in the aggregate
number of shares of Voting Stock outstanding since the last date on
which such Person acquired Beneficial Ownership of any shares of the
Voting Stock constituting all or a portion of such Substantial Block;
and (iii) any Person who or which, together with all Affiliates and
Associates of such Person, becomes the Beneficial Owner of a
Substantial Block in the good faith belief that such acquisition would
not (x) cause such Person and its Affiliates and Associates to become
the Beneficial Owner of a Substantial Block and such Person relied in
good faith in computing the percentage of its voting power on publicly
filed reports or documents of the Company which are inaccurate or
out-of-date or (y) otherwise cause a Distribution Date or the
adjustment provided for in Section 11(a) to occur. Notwithstanding
clause (ii) or (iii) of the prior sentence, if any Person that is not
an Acquiring Person due to such clause (ii) or (iii) does not cease to
be the Beneficial Owner of a Substantial Block by the close of business
on the fifth Business Day after notice from the Company (the date of
notice being the first day) that such Person is the Beneficial Owner of
a Substantial Block, such Person shall, at the end of such five
Business Day period, become an Acquiring Person (and such clause (ii)
or (iii) shall no longer apply to such Person). For purposes of this
definition, the determination whether any Person acted in "good faith"
shall be conclusively determined by the Board of Directors of the
Company, acting by a vote of those directors of the Company whose
approval would be required to redeem the Rights under Section 23.
Notwithstanding the foregoing, no Person shall become an "Acquiring
Person" as a result of an acquisition of Common Stock by the Company
which, by reducing the number of shares of Common Stock outstanding,
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increases the proportionate number of shares of Common Stock
beneficially owned by such Person to 15% or more of the shares of
Common Stock of the Company then outstanding; provided, however, that
if a Person shall become the Beneficial Owner of 15% or more of the
shares of Common Stock of the Company then outstanding as a result of
an acquisition of Common Stock by the Company and shall, after such
acquisition of Common Stock by the Company, become the Beneficial Owner
of any additional Common Stock of the Company other than pursuant to a
stock split, stock dividend or similar transaction) and immediately
thereafter be the Beneficial Owner of 15% or more of the shares of
Common Stock then outstanding, then such Person shall be deemed to be
an "Acquiring Person".
(b) "Act" shall have the meaning set forth in Section 9(c)
hereof.
(c) "Adjustment Shares" shall have the meaning set forth in
Section 11(a)(ii) hereof.
(d) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), as in effect on the date hereof.
(e) "Agreement" shall have the meaning set forth in the
introduction hereto.
(f) A Person shall be deemed the "Beneficial Owner" of and
shall be deemed to "beneficially own" any securities:
(i) which such Person or any of such Person's
Affiliates or Associates has, directly or indirectly, the
right to acquire (whether such right is exercisable
immediately or only after the passage of time or upon the
occurrence of an event) pursuant to any agreement, arrangement
or understanding (whether or not in writing), or upon the
exercise of conversion rights, exchange rights, rights,
warrants or options, or otherwise; provided, however, that a
Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially own," (1) securities tendered pursuant to a
tender or exchange offer made by such Person or any of such
Person's Affiliates or Associates until such tendered
securities are accepted for purchase or exchange, (2)
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securities issuable upon exercise of Rights at any time prior
to the occurrence of a Triggering Event or (3) securities
issuable upon exercise of Rights from and after the occurrence
of a Triggering Event, which Rights were acquired by such
Person or any of such Person's Affiliates or Associates prior
to the Distribution Date or pursuant to Section 3(a) hereof
("Original Rights") or pursuant to Section 11(i) or Section 22
hereof in connection with an adjustment made with respect to
Original Rights; or
(ii) which such Person or any of such Person's
Affiliates or Associates has, directly or indirectly, the
right to vote or dispose of or has "beneficial ownership" of
(as determined pursuant to Rule 13d-3 of the General Rules and
Regulations under the Exchange Act), including pursuant to any
agreement, arrangement or understanding (whether or not in
writing) or has a "pecuniary interest" or an "indirect
pecuniary interest" in (as determined pursuant to Rule
16a-1(a)(2) of the General Rules and Regulations under the
Exchange Act); provided, however, that a Person shall not be
deemed the "Beneficial Owner" of, or to "beneficially own,"
any security under this subparagraph (ii) if the agreement,
arrangement or understanding to vote such security (1) arises
solely from a revocable proxy given in response to a public
proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations of the
Exchange Act and (2) is not then reportable on Schedule 13D
under the Exchange Act (or any comparable or successor
report); or
(iii) which are beneficially owned, directly or
indirectly, by any other Person with which such Person or any
of such Person's Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing) for
the purpose of acquiring, holding, voting (except pursuant to
a revocable proxy as described in the proviso to subparagraph
(ii) of this paragraph (f)) or disposing of any securities of
the Company.
Notwithstanding the foregoing, nothing contained in this definition
shall cause a Person ordinarily engaged in business as an underwriter
of securities to be the "Beneficial Owner" of, or to "beneficially
own," any securities acquired in a bona fide firm commitment
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underwriting pursuant to an underwriting agreement with the Company.
(g) "Business Day" shall mean any day other than a Saturday,
Sunday, or a day on which banking institutions in the State of New York
are authorized or obligated by law or executive order to close.
(h) "Certification" shall have the meaning set forth in
Section 18 hereof.
(i) "close of business" on any given date shall mean 5:00
P.M., New York City time, on such date, provided, however, if such date
is not a Business Day it shall mean 5:00 P.M. on the next succeeding
Business Day.
(j) "Common Stock" when used with reference to the Company
shall mean the Class A Common Stock, par value $0.01 per share, and
Class B Common Stock, par value $0.01 per share, of the Company.
"Common Stock" when used with reference to any Person other than the
Company shall mean either the capital stock with the greatest voting
power of such other Person or, if such Person is a Subsidiary of
another Person, the equity securities or other equity interest having
power to control or direct the management of such Person.
(k) "Common Stock Equivalents" shall have the meaning set
forth in Section 11(a)(iii) hereof.
(l) "Company" shall have the meaning set forth in the
introduction hereto.
(m) "Current Market Price" shall have the meaning set forth in
Section 11(d) hereof.
(n) "Current Value" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(o) "Distribution" shall have the meaning set forth in the
recitals hereto.
(p) "Distribution Date" shall have the meaning set forth in
Section 3(a) hereof.
(q) "Equivalent Preferred Stock" shall have the meaning set
forth in Section 11(b) hereof.
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(r) "Exchange Act" shall have the meaning set forth in the
definitions of "Affiliate" and "Associate" above.
(s) "Exchange Ratio" shall have the meaning set forth in
Section 24(a) hereof.
(t) "Expiration Date" shall have the meaning set forth in
Section 7(a) hereof.
(u) "Final Expiration Date" shall have the meaning set forth
in Section 7(a) hereof.
(v) "Independent Director" shall mean, with respect to any
transaction or series of transactions, a member of the Board of
Directors of the Company other than a director who has a relationship
that would interfere with the exercise of independent judgment in
carrying out the responsibilities of a director or a financial interest
in or with respect to such transaction or series of transactions.
(w) "Original Rights" shall have the meaning set forth in the
definition of "Beneficial Owner" above.
(x) "Person" shall mean any individual, firm, corporation,
partnership or other entity.
(y) "Preferred Stock" shall mean the shares of Series A Junior
Participating Preferred Stock, par value $0.01 per share, of the
Company.
(z) "Principal Party" shall have the meaning set forth in
Section 13(b) hereof.
(aa) "Purchase Price" shall have the meaning set forth in
Section 4(a) hereof.
(bb) "Record Date" shall have the meaning set forth in the
recitals hereto.
(cc) "Redemption Price" shall have the meaning set forth in
Section 23(a) hereof.
(dd) "Rights" shall have the meaning set forth in the
recitals hereto.
(ee) "Rights Agent" shall have the meaning set forth in the
introduction hereto.
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(ff) "Right Certificate" shall have the meaning set forth in
Section 3(a) hereof.
(gg) "Rights Dividend Declaration Date" shall have the meaning
set forth in the recitals hereto.
(hh) "Section 11(a)(ii) Event" shall mean any event described
in Section 11(a)(ii) hereof.
(ii) "Section 11(a)(ii) Trigger Date" shall have the meaning
set forth in Section 11(a)(iii) hereof.
(jj) "Section 13 Event" shall mean any event described in
Section 13(a) hereof.
(kk) "Shares Acquisition Date" shall mean the first date of
public announcement (which, for purposes of this definition, includes a
report filed pursuant to Section 13(d) of the Exchange Act) by the
Company or an Acquiring Person that an Acquiring Person has become
such.
(ll) "Spread" shall have the meaning set forth in Section
11(a)(iii) hereof.
(mm) "Subsidiary" shall mean, with reference to any Person,
any corporation (or other entity) of which an amount of voting
securities (or comparable ownership interests) sufficient to elect at
least a majority of the directors (or comparable individuals) of such
corporation (or other entity) is beneficially owned or otherwise
controlled, directly or indirectly, by such Person.
(nn) "Substantial Block" shall mean a number of shares of the
Voting Stock which has 15% or more of the aggregate voting power of all
outstanding shares of Voting Stock.
(oo) "Substitution Period" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(pp) "Summary of Rights" shall have the meaning set forth in
Section 3(b) hereof.
(qq) "Trading Day" shall have the meaning set forth in Section
11(d) hereof.
(rr) "Triggering Event" shall mean any Section 11(a)(ii)
Event or Section 13 Event.
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(ss) "Voting Stock" shall mean the outstanding shares of Class
A Common Stock, $0.01 par value, and any other shares of capital stock
of the Company which are entitled to vote generally in the election of
directors.
Section 2. Appointment of Rights Agent. The Company hereby
----------------------------
appoints the Rights Agent to act as agent for the Company in accordance with the
terms and conditions hereof, and the Rights Agent hereby accepts such
appointment. The Company shall act as Co-Rights Agent and may from time to time
appoint such other Co-Rights Agents as it may deem necessary or desirable upon
ten calendar days' written notice to the Rights Agent. In no event shall the
Rights Agent have any duty to supervise or in any way be liable for such
Co-Rights Agents.
Section 3. Issue of Right Certificates. (a) Until the
---------------------------
earlier of (i) the close of business on the tenth calendar day after the
Shares Acquisition Date (or, if the tenth calendar day after the Shares
Acquisition Date occurs before the Record Date, the close of business on
the Record Date) or (ii) the close of business on the tenth calendar day
(or such later date as may be determined by action of the Board of
Directors prior to such time as any Person becomes an Acquiring Person) after
the date of the commencement of, or first public announcement of the intent of
any Person (other than the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or of any Subsidiary of the Company or any Person
organized, appointed or established by the Company or any Subsidiary of the
Company or any Person organized, appointed or established by the Company or any
Subsidiary of the Company for or pursuant to the terms of such plan) to
commence, a tender or exchange offer if, upon consummation thereof, such Person
would be an Acquiring Person (the earlier of the dates in subsections (i) and
(ii) hereof being herein referred to as the "Distribution Date") (x) the Rights
will be evidenced (subject to the provisions of paragraph (b) of this Section 3)
by the certificates for the Common Stock registered in the names of the holders
of the Common Stock (which certificates for the Common Stock shall be deemed
also to be Right Certificates) and not by separate Right Certificates, and (y)
the right to receive Right Certificates will be transferable only in connection
with the transfer of Common Stock. As soon as practicable after receipt by the
Rights Agent of written notice from the Company of the Distribution Date, the
Rights Agent, at the Company's expense, will send by first-class, postage
prepaid mail, to each record holder of Common Stock as of the close of business
on the Distribution Date, at the address of such holder shown on the records of
the Company, a Right Certificate, in substantially the form of Exhibit B hereto,
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evidencing one Right for each share of the Common Stock so held, subject to
adjustment as provided herein. As of the Distribution Date, the Rights will be
evidenced solely by such Right Certificates.
(b) As soon as practicable following the Record Date, the
Company will send a copy of a Summary of Rights to Purchase Preferred Stock, in
substantially the form attached hereto as Exhibit C (the "Summary of Rights"),
by first-class, postage prepaid mail, to each record holder of Common Stock as
of the close of business on the Record Date, at the address of such holder shown
on the records of the Company. With respect to certificates for Common Stock
outstanding as of the Record Date, until the Distribution Date, the Rights will
be evidenced by such certificates for Common Stock, and the registered holders
of the Common Stock shall also be the registered holders of the associated
Rights. Until the Distribution Date (or earlier redemption or expiration of the
Rights), the surrender for transfer of any of the certificates for Common Stock
outstanding on the Record Date shall also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate.
(c) Rights shall be issued in respect of all shares of Common
Stock issued after the Record Date but prior to the earlier of the Distribution
Date or the Expiration Date (as such term is defined in Section 7), or, in
certain circumstances provided in Section 22 hereof, after the Distribution
Date. Certificates representing such shares of Common Stock shall have impressed
on, printed on, written on or otherwise affixed to them the following legend:
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in a Rights Agreement between Lexmark
International Group, Inc. and ChaseMellon Shareholders Services, L.L.C.
(the "Rights Agreement"), the terms of which are hereby incorporated
herein by reference and a copy of which is on file at the principal
executive offices of Lexmark International Group, Inc. Under certain
circumstances, as set forth in the Rights Agreement, such Rights will
be evidenced by separate certificates and will no longer be evidenced
by this certificate. Lexmark International Group, Inc. will mail to the
holder of this certificate a copy of the Rights Agreement as in effect
on the date of mailing without charge within five Business Days after
receipt of a written request therefor. Under certain circumstances set
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forth in the Rights Agreement, Rights beneficially owned by an
Acquiring Person may become null and void.
After the due execution of any supplement or amendment to this Agreement in
accordance with the terms hereof, the reference to this Agreement in the
foregoing legend shall mean the Agreement as so supplemented or amended. Until
the Distribution Date, the Rights associated with the Common Stock represented
by certificates containing the foregoing legend shall be evidenced by such
certificates alone, and the surrender for transfer of any of such certificates
shall also constitute the transfer of the Rights associated with the Common
Stock represented by such certificate. In the event that the Company purchases
or acquires any shares of Common Stock after the Record Date but prior to the
Distribution Date, any Rights associated with such Common Stock shall be deemed
canceled and retired so that the Company shall not be entitled to exercise any
Rights associated with the shares of Common Stock which are no longer
outstanding. The failure to print the foregoing legend on any such Common Stock
certificate or any other defect therein shall not affect in any manner
whatsoever the application or interpretation of the provisions of Section 7(e)
hereof.
Section 4. Form of Right Certificates. (a) The Right
------------------------------
Certificates (and the forms of election to purchase shares and of assignment to
be printed on the reverse thereof) shall be substantially the same as Exhibit B
hereto and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem
appropriate 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 on which the Rights may from time to time be listed, or to conform to
usage. The Right Certificates shall be in machine-printable format and in a form
reasonably satisfactory to the Rights Agent. Subject to the provisions of
Section 11 and Section 22 hereof, the Right Certificates, whenever distributed,
shall be dated as of the Record Date, shall show the date of countersignature,
and on their face shall entitle the holders thereof to purchase such number of
shares of Preferred Stock (or following a Triggering Event, Class A Common
Stock, other securities, cash or other assets, as the case may be) as shall be
set forth therein at the price per one one-thousandth of a share of Preferred
Stock set forth therein (the "Purchase Price"), but the number of such shares
and the Purchase Price shall be subject to adjustment as provided herein.
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(b) Notwithstanding any other provision of this Agreement, (i)
any Right Certificate issued pursuant to Section 3(a) or Section 22 hereof that
represents Rights beneficially owned by: (x) an Acquiring Person or any
Associate or Affiliate thereof, (y) a transferee of an Acquiring Person (or of
any such Associate or Affiliate) who becomes a transferee after the Acquiring
Person became such, or (z) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the Acquiring Person to
holders of equity interests in such Acquiring Person or to any Person with whom
such Acquiring Person has any continuing agreement, arrangement or understanding
(whether or not in writing) regarding the transferred Rights or (B) a transfer
which the Board of Directors of the Company has determined is part of a plan,
arrangement or understanding (whether or not in writing) which has as a primary
purpose or effect avoidance of Section 7(e) hereof, (ii) any Right Certificate
issued at any time to any nominee of such Acquiring Person, Associate or
Affiliate, and (iii) any Right Certificate issued pursuant to Section 6 or
Section 11 hereof, upon transfer, exchange, replacement or adjustment of any
other Right Certificate referred to in this sentence, shall contain (to the
extent feasible following the written instruction of the Company to the Rights
Agent) the following legend, modified as applicable to apply to such Person:
The Rights represented by this Right Certificate are or were
beneficially owned by a Person who was or became an Acquiring Person or
an Affiliate or an Associate of an Acquiring Person (as such terms are
defined in the Amended and Restated Rights Agreement). Accordingly,
this Right Certificate and the Rights represented may become null and
void in the circumstances specified in Section 7(e) of the Amended and
Restated Rights Agreement.
Section 5. Countersignature and Registration. The Right
-----------------------------------
Certificates shall be executed on behalf of the Company by one of its authorized
officers either manually or by facsimile signature. The Right Certificates shall
be countersigned by an authorized signatory of the Rights Agent either manually
or by facsimile signature and shall not be valid for any purpose unless so
countersigned. In case any officer of the Company who shall have signed any of
the Right Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
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such Right Certificates, nevertheless, may be countersigned by the Rights Agent,
issued and delivered with the same force and effect as though the person who
signed such Right Certificates had not ceased to be such officer of the Company;
and any Right Certificate may be signed on behalf of the Company by any person
who, at the actual date of the execution of such Right Certificate, shall be a
proper officer of the Company to sign such Right Certificate, although at the
date of the execution of this Agreement any such person was not such an officer.
In case any authorized signatory of the Rights Agent who shall
have countersigned any of the Right Certificates shall cease to be such
signatory before delivery by the Company, such Right Certificates, nevertheless,
may be issued and delivered by the Company with the same force and effect as
though the person who countersigned such Right Certificates not ceased to be
such signatory; and any Right Certificate may be countersigned on behalf of the
Rights Agent by any person who, at the actual date of the countersignature of
such Right Certificate, shall be a proper signatory of the Rights Agent to
countersign such Right Certificate, although at the date of the execution of
this Agreement any such person was not such a signatory.
Following the Distribution Date, the Rights Agent will keep or
cause to be kept, at its office designated for such purpose, books for
registration and transfer of the Right Certificates issued hereunder. Such books
shall show the names and addresses of the respective holders of the Right
Certificates, the number of Rights evidenced on its face by each of the Right
Certificates, and the date of each of the Right Certificates and the date of
countersignature of each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of
--------------------------------------------------
Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
- -------------------------------------------------------------------------------
Subject to the provisions of Section 14 hereof, at any time after the close of
business on the Distribution Date, and at or prior to the close of business on
the 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 Preferred Stock (or following a Triggering Event, Class A Common
Stock, other securities, cash or other assets, as the case may be) as the Right
Certificate or Right Certificates surrendered then entitled such holder (or
former holder in the case of a transfer) to purchase. Any registered holder
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<PAGE>
desiring to transfer, split up, combine or exchange any Right Certificate or
Right Certificates shall make such request in writing delivered to the Rights
Agent, and shall surrender the Right Certificate or Right Certificates to be
transferred, split up, combined or exchanged at the office of the Rights Agent
designated for such purpose, along with a signature guarantee and such other and
further documentation as the Rights Agent may reasonably request. Neither the
Rights Agent nor the Company shall be obligated to take any action whatsoever
with respect to the transfer of any such surrendered Right Certificate until the
registered holder shall have completed and signed the certificate contained in
the form of assignment on the reverse side of such Right Certificate and shall
have provided such additional evidence, as the Company shall reasonably request,
of the identity of the Beneficial Owner, Affiliates or Associates thereof or of
the holder, or of any other Person with which such holder or any of such
holder's Affiliates or Associates has any agreement, arrangement or
understanding (whether or not in writing) for the purpose of acquiring, holding,
voting or disposing of securities of the Company. Thereupon the Rights Agent
shall, subject to Section 4(b), Section 7(e), Section 14 and Section 20(k)
hereof, countersign and deliver to the Person entitled thereto a Right
Certificate or Right Certificates, as the case may be, as so requested. The
Company may require payment from a Right Certificate holder of a sum sufficient
to cover any tax or governmental charge that may be imposed in connection with
any transfer, split up, combination or exchange of Right Certificates.
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 reasonably satisfactory to them, along with a signature guarantee and
such other further documentation as the Rights Agent may reasonably request and
reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender to the Rights Agent and cancellation of
the Right Certificate if mutilated, the Company will make and deliver a new
Right Certificate of like tenor to the Rights Agent for delivery to the
registered owner in lieu of the Right Certificate so lost, stolen, destroyed or
mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date
---------------------------------------------------
of Rights. (a) Subject to Section 7(e) hereof, the registered holder of any
- ---------
Right Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein, including, without limitation, the restrictions on
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<PAGE>
exercisability set forth in Sections 9(c), 11(a)(iii), 23(b) and 24(b) hereof)
in whole or in part at any time after the Distribution Date upon surrender of
the Right Certificate, with the form of election to purchase on the reverse side
thereof duly executed, to the Rights Agent at the designated office of the
Rights Agent, together with payment of the aggregate Purchase Price for the
total number of one one-thousandths of shares of Preferred Stock (or shares of
Class A Common Stock, other securities, cash or other assets, as the case may
be) as to which the Rights are then exercisable, at or prior to the earliest of
(i) the close of business on January 31, 2009 (the "Final Expiration Date"),
(ii) the time at which the Rights are exchanged as provided in Section 24, or
(iii) the time at which the Rights are redeemed as provided in Section 23 (such
earliest date being herein referred to as the "Expiration Date").
(b) The Purchase Price for each one one-thousandth of a share
of Preferred Stock pursuant to the exercise of a Right shall initially be $200,
shall be subject to adjustment from time to time as provided in Sections 11 and
13 hereof and shall be payable in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase and the certificate
duly executed and completed accompanied by payment of the Purchase Price for the
number of one one-thousandths of shares of Preferred Stock (or shares of Class A
Common Stock, other securities, cash or other assets, as the case may be) to be
purchased and an amount equal to any applicable transfer tax, the Rights Agent
shall thereupon, subject to Section 20(k), promptly (i) requisition from any
transfer agent of Preferred Stock certificates for the number of one
one-thousandths of shares of Preferred Stock to be purchased and the Company
hereby irrevocably authorizes its transfer agent to comply with all such
requests, (ii) if the Company shall have elected to deposit the total number of
shares of Preferred Stock issuable upon exercise of the Rights hereunder with a
depositary agent, requisition from the depositary agent depositary receipts
representing such number of shares of Preferred Stock as are to be purchased (in
which case certificates for the shares of Preferred Stock represented by such
receipts shall be deposited by the transfer agent with the depositary agent) and
the Company hereby directs the depositary agent to comply with such request,
(iii) when appropriate, requisition from any transfer agent of the Common Stock
of the Company certificates for the total number of shares of Class A Common
Stock to be paid in accordance with Section 11(a)(ii) and 11(a)(iii), (iv) when
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<PAGE>
appropriate, requisition from the Company the amount of cash to be paid in lieu
of issuance of fractional shares in accordance with Section 14, (v) promptly
after receipt of such certificates or depositary receipts, cause the same to be
delivered to or upon the order of the registered holder of such Right
Certificate, registered in such name or names as may be designated by such
holder and (vi) when appropriate, after receipt promptly deliver such cash to or
upon the order of the registered holder of such Right Certificate. The payment
of the then Purchase Price may be made in cash or by certified bank check or
bank draft or money order payable to the order of the Company or the Rights
Agent. In the event that the Company is obligated to issue securities,
distribute property or pay cash pursuant to Section 11(a)(iii) hereof, the
Company will make all arrangements necessary so that cash, property or
securities are available for issuance, distribution or payment by the Rights
Agent, if and when appropriate.
(d) In case the registered holder of any Right Certificate
shall exercise less than all the Rights evidenced thereby, a new Right
Certificate evidencing Rights equivalent to the Rights remaining unexercised
shall be issued by the Rights Agent to the registered holder of such Right
Certificate or to his duly authorized assigns, subject to the provisions of
Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of a Section 11(a)(ii) Event, any
Rights beneficially owned by (i) an Acquiring Person or any Associate or
Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee after the Acquiring
Person became such, or (iii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the Acquiring Person to
holders of equity interests in such Acquiring Person or to any Person with whom
the Acquiring Person has any continuing agreement, arrangement or understanding
(whether or not in writing) regarding the transferred Rights or (B) a transfer
which the Board of Directors of the Company has determined is a part of a plan,
arrangement or understanding (whether or not in writing) which has as a primary
purpose or effect the avoidance of this Section 7(e), shall become null and void
without any further action and no holder of such Rights shall have any rights
whatsoever with respect to such Rights, whether under any provision of this
Agreement or otherwise. The Company shall use all reasonable efforts to insure
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<PAGE>
that the provisions of this Section 7(e) and Section 4(b) hereof are complied
with, but shall have no liability to any holder of Right Certificates or other
Person as a result of its failure to make any determinations with respect to an
Acquiring Person or its Affiliates, Associates or transferees hereunder.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder upon the occurrence of
any purported exercise as set forth in this Section 7 unless such registered
holder shall have (i) completed and signed the certificate contained in the form
of election to purchase set forth on the reverse side of the Right Certificate
surrendered for such exercise, and (ii) provided such additional evidence of the
identity of the Beneficial Owner, Affiliates or Associates thereof or of the
holder, or of any other Person with which such holder or any of such holder's
Affiliates or Associates has any agreement, arrangement or understanding
(whether or not in writing) for the purpose of acquiring, holding, voting or
disposing of any securities of the Company as the Company shall reasonably
request.
Section 8. Cancellation and Destruction of Right Certificates.
--------------------------------------------------
All Right Certificates surrendered for the purpose of exercise, transfer, split
up, combination or exchange shall, if surrendered to the Company or to any of
its agents, be delivered to the Rights Agent for cancellation or in canceled
form, or, if surrendered to the Rights Agent, shall be canceled by it, and no
Right Certificates shall be issued in lieu thereof except as expressly permitted
by any of the provisions of this Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Right Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall deliver
all canceled Right Certificates to the Company, or shall, at the written request
of the Company, destroy such canceled Right Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Shares of Capital
--------------------------------------------------
Stock. (a) The Company covenants and agrees that it will cause to be reserved
- -----
and kept available out of its authorized and unissued shares of Preferred Stock
(and following the occurrence of a Triggering Event, out of its authorized and
unissued shares of Common Stock and/or other securities) or out of its
authorized and issued shares of Preferred Stock (and, following the occurrence
of a Triggering Event, out of its authorized and issued Common Stock and/or
16
<PAGE>
other securities) held in its treasury, the number of shares of Preferred Stock
(and, following the occurrence of a Triggering Event, Class A Common Stock
and/or other securities) that will be sufficient to permit the exercise in full
of all outstanding Rights (it being understood that any of the foregoing shares
or securities may also be reserved for other purposes) or will take such other
steps as are appropriate to assure that the number of such shares or securities
(or their equivalents) sufficient to permit the exercise in full of all
outstanding Rights will be available upon such exercise.
(b) So long as the shares of Preferred Stock (and, following
the occurrence of a Triggering Event, Class A Common Stock and/or other
securities) issuable upon the exercise of Rights may be listed on any national
securities exchange, the Company shall use its best efforts to cause, from and
after such time as the Rights become exercisable (but only to the extent that it
is reasonably likely that the Rights will be exercised), all shares reserved for
such issuance to be listed on such exchange upon official notice of issuance
upon such exercise.
(c) The Company shall use its best efforts (X) (i) to file, as
soon as practicable following the first occurrence of a Section 11(a)(ii) Event,
or as soon as required by law, as the case may be, a registration statement
under the Securities Act of 1933, as amended (the "Act"), with respect to the
securities purchasable upon exercise of the Rights on an appropriate form, (ii)
to cause such registration statement to become effective as soon as practicable
after such filing, and (iii) to cause such registration statement to remain
effective (with a prospectus at all times meeting the requirements of the Act)
until the earlier of (A) the date as of which the Rights are no longer
exercisable for such securities, and (B) the Expiration Date and (Y) (i) to file
appropriate applications with any state or federal regulatory bodies having
jurisdiction over the issuance of the securities (or assets) purchasable upon
exercise of the Rights in order to obtain any approvals or orders of such bodies
as may be legally required, (ii) to cause such approvals to be obtained or
orders to be issued as soon as practicable after such filing and (iii) to cause
such approvals or orders to remain effective until the earlier of (A) the date
as of which the Rights are no longer exercisable for such securities (or
assets), and (B) the Expiration Date, to the extent not previously obtained. The
Company will also take such action as may be appropriate under the blue sky laws
of the various states. The Company may temporarily suspend, (X) for a period of
17
<PAGE>
time not to exceed ninety (90) days after the date set forth in clause (X)(i) of
the first sentence of this Section 9(c), the exercisability of the Rights in
order to prepare and file such registration statement and permit it to become
effective and (Y) for a period of time not in excess of 180 days after such date
(or for such longer period as is required by any applicable law, rule or
regulation of any appropriate regulatory bodies), the exercisability of the
Rights in order to obtain any such required regulatory body approvals or orders.
Upon any such suspension, the Company shall issue a public announcement and
shall give simultaneous written notice to the Rights Agent stating that the
exercisability of the Rights has been temporarily suspended, as well as a public
announcement and notice to the Rights Agent at such time as the suspension is no
longer in effect. Notwithstanding any provision of this Agreement to the
contrary, the Rights shall not be exercisable in any jurisdiction unless the
requisite qualifications in such jurisdiction shall have been obtained.
(d) The Company covenants and agrees that it will take all
such action as may be necessary to ensure that all shares of the Preferred Stock
(and following the occurrence of a Triggering Event, Class A Common Stock and/or
other securities) delivered upon exercise of Rights shall, at the time of
delivery of the certificates for such shares (subject to payment of the Purchase
Price), be duly and validly authorized and issued and fully paid and
nonassessable.
(e) The Company further covenants and agrees that it will pay
when due and payable any and all federal and state transfer taxes and charges
which may be payable in respect of the issuance or delivery of the Right
Certificates or of any shares of the Preferred Stock (or Class A Common Stock
and/or other securities, as the case may be) upon the exercise of Rights. The
Company shall not, however, be required (a) to pay any transfer tax which may be
payable in respect of any transfer involved in the transfer or delivery of Right
Certificates or the issuance or delivery of certificates for the Preferred Stock
(or Class A Common Stock and/or other securities, as the case may be) in a name
other than that of the registered holder of the Right Certificate evidencing
Rights surrendered for exercise or (b) to issue or deliver any certificates for
shares of the Preferred Stock (or Class A Common Stock and/or other securities,
as the case may be) upon the exercise of any Rights until any such tax shall
have been paid (any such tax being payable by the holder of such Right
Certificate at the time of surrender) or until it has been established to the
Company's satisfaction that no such tax is due.
18
<PAGE>
Section 10. Preferred Stock Record Date. Each person in
---------------------------
whose name any certificate for any number of shares of Preferred Stock
(or Class A Common Stock and/or other securities, as the case may be) is
issued upon the exercise of Rights shall for all purposes be
deemed to have become the holder of record of such whole and/or fractional
shares of Preferred Stock (or Class A Common Stock and/or other securities, as
the case may be) represented thereby on, and such certificate shall be dated the
date upon which the Right Certificate evidencing such Rights was duly
surrendered and payment of the Purchase Price (and any applicable transfer
taxes) was made and shall show the date of countersignature; provided, however,
-----------------
that if the date of such surrender and payment is a date upon which the
Preferred Stock (or Class A Common Stock and/or other securities, as the case
may be) transfer books of the Company are closed, such person shall be deemed to
have become the record holder of such shares on, and such certificate shall be
dated, the next succeeding Business Day on which the Preferred Stock (or Class A
Common Stock and/or other securities, as the case may be) transfer books of the
Company are open. Prior to the exercise of the Rights evidenced thereby, the
holder of a Right Certificate shall not be entitled to any rights of a
stockholder of the Company with respect to shares for which the Rights shall be
exercisable, including, without limitation, the right to vote, to receive
dividends or other distributions or to exercise any preemptive rights, and shall
not be entitled to receive any notice of any proceedings of the Company, except
as provided herein.
Section 11. Adjustment of Purchase Price, Number of Shares or
-------------------------------------------------
Number of Rights. The Purchase Price, the number of shares covered by each
- ----------------
Right and the number of Rights outstanding are subject to adjustment from time
to time as provided in this Section 11.
(a)(i) In the event the Company shall at any time after the
date of this Agreement (A) declare a dividend on the Preferred Stock payable in
shares of the Preferred Stock, (B) subdivide the outstanding Preferred Stock,
(C) combine the outstanding Preferred Stock into a smaller number of shares or
(D) issue any shares of its capital stock in a reclassification of the Preferred
Stock (including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing or surviving corporation), except
as otherwise provided in this Section 11(a) and Section 7(e) hereof, the
Purchase Price in effect at the time of the record date for such dividend or of
the effective date of such subdivision, combination or reclassification, and the
number and kind of shares of Preferred Stock or capital stock, as the case may
19
<PAGE>
be, issuable on such date, shall be proportionately adjusted so that the holder
of any Right exercised after such time shall be entitled to receive upon payment
of the Purchase Price then in effect the aggregate number and kind of shares of
capital stock which, if such Right had been exercised immediately prior to such
date and at a time when the Preferred Stock (or Common Stock and/or other
securities) 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),
the adjustment provided for in this Section 11(a)(i) shall be in addition to,
and shall be made prior to, any adjustment required pursuant to section
11(a)(ii).
(ii) Subject to Section 24 of this Agreement, in the event
any Person, alone or together with its Affiliates and Associates, becomes an
Acquiring Person except as the result of a transaction set forth in Section
13(a) hereof, then, prior to the later of (x) the date on which the Company's
rights of redemption pursuant to Section 23(a) expire, or (y) five (5)
days after the date of the first occurrence of a Section 11(a)(ii) Event,
proper provision shall be made so that each holder of a Right, except as
provided in Section 7(e) hereof, shall thereafter have a right to receive,
upon exercise thereof at the then current Purchase Price for the number of one
one-thousandths of a share of Preferred Stock for which such Right is then
exercisable in accordance with the terms of this Agreement, in lieu of shares
of Preferred Stock, such number of shares of the Class A Common Stock of the
Company as shall equal the result obtained by (x) multiplying the then
current Purchase Price by the then number of one one-thousandths of a
share of Preferred Stock for which a Right is then exercisable and
dividing that product by (y) 50% of the Current Market Price per share of the
Class A Common Stock of the Company (determined pursuant to Section 11(d))
on the date of the occurrence of the event listed above in this
subparagraph (ii) (such number of shares are hereinafter referred to as the
"Adjustment Shares") provided that the Purchase Price and the number of
Adjustment Shares shall be further adjusted as provided in this Agreement to
reflect any events occurring after the date of such first occurrence.
(iii) In the event that the number of shares of Common Stock
which are authorized by the Company's Third Restated Certificate of
Incorporation but not outstanding or reserved for issuance for purposes other
20
<PAGE>
than upon exercise of the Rights are not sufficient to permit the exercise in
full of the Rights in accordance with the foregoing subparagraph (ii), the
Company shall (A) determine the excess of (1) the value of the Adjustment Shares
issuable upon the exercise of a Right (the "Current Value") over (2) the
Purchase Price (such excess, the "Spread"), and (B) with respect to each Right,
make adequate provision to substitute for the Adjustment Shares, upon exercise
of the Rights and payment of the applicable Purchase Price, (1) cash, (2) a
reduction in the Purchase Price, (3) Class A Common Stock or other equity
securities of the Company (including, without limitation, shares, or units of
shares, of preferred stock which a majority of the Independent Directors and the
Board of Directors of the Company have deemed to have the same value as shares
of Class A Common Stock (such shares of preferred stock, "Common Stock
Equivalents")), (4) debt securities of the Company, (5) other assets, or (6) any
combination of the foregoing, having an aggregate value equal to the Current
Value, where such aggregate value has been determined by a majority of the
Independent Directors and the Board of Directors of the Company based upon the
advice of a nationally recognized investment banking firm selected by the Board
of Directors of the Company; provided, however, if the Company shall not have
made adequate provision to deliver value pursuant to clause (B) above within
thirty (30) days following the later of (x) the first occurrence of a Section
11(a)(ii) Event and (y) the date on which the Company's rights of redemption
pursuant to Section 23(a) expires (the later of (x) and (y) being referred to
herein as the "Section 11(a)(ii) Trigger Date"), then the Company shall be
obligated to deliver, upon the surrender for exercise of a Right and without
requiring payment of the Purchase Price, shares of Class A Common Stock (to the
extent available) and then, if necessary, cash, which shares and/or cash have an
aggregate value equal to the Spread. If the Board of Directors of the Company
shall determine in good faith that it is likely that sufficient additional
shares of Class A Common Stock could be authorized for issuance upon exercise in
full of the Rights, the thirty (30) day period set forth above may be extended
to the extent necessary, but not more than ninety (90) days after the Section
11(a)(ii) Trigger Date, in order that the Company may seek shareholder approval
for the authorization of such additional shares (such period, as it may be
extended, the "Substitution Period"). To the extent that the Company determines
that some action need be taken pursuant to the first and/or second sentences of
this Section 11(a)(iii), the Company (x) shall provide, subject to Section 7(e)
hereof, that such action shall apply uniformly to all outstanding Rights, and
(y) may suspend the exercisability of the Rights until the expiration of the
21
<PAGE>
Substitution Period in order to seek any authorization of additional shares
and/or to decide the appropriate form of distribution to be made pursuant to
such first sentence and to determine the value thereof. In the event of any such
suspension, the Company shall issue a public announcement and shall give
simultaneous written notice to the Rights Agent stating that the exercisability
of the Rights has been temporarily suspended, as well as a public announcement
and notice to the Rights Agent at such time as the suspension is no longer in
effect. For purposes of this Section 11(a)(iii), the value of the Common Stock
shall be the Current Market Price (as determined pursuant to Section 11(d)
hereof) per share of the Common Stock on the Section 11(a)(ii) Trigger Date and
the value of any Common Stock Equivalent shall be deemed to have the same value
as the Common Stock on such date. The Company shall give the Rights Agent notice
of the selection of any Common Stock Equivalent under this Section 11(a)(iii).
(b) In case the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of Preferred Stock
entitling them (for a period expiring within 45 calendar days after such record
date) to subscribe for or purchase Preferred Stock (or securities having
substantially the same rights, privileges and preferences as the shares of
Preferred Stock ("Equivalent Preferred Stock") or convertible into the Preferred
Stock or Equivalent Preferred Stock) at a price per share of the Preferred Stock
or Equivalent Preferred Stock (or having a conversion price per share, if a
security convertible into the Preferred Stock or Equivalent Preferred Stock)
less than the Current Market Price (as defined in Section 11(d) per share of the
Preferred Stock or Equivalent Preferred Stock, as the case may be) on such
record date, the Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in effect immediately prior to such
record date by a fraction, of which the numerator shall be the number of shares
of Preferred Stock outstanding on such record date plus the number of shares of
Preferred Stock or Equivalent Preferred Stock which the aggregate offering price
of the total number of shares of Preferred Stock or Equivalent Preferred Stock
so to be offered (and/or the aggregate initial conversion price of the
convertible securities so to be offered) would purchase at such Current Market
Price and of which the denominator shall be the number of shares of Preferred
Stock outstanding on such record date plus the number of additional shares of
Preferred Stock and/or Equivalent Preferred Stock to be offered for subscription
or purchase (or into which the convertible securities so to be offered are
initially convertible). In case such subscription price may be paid by delivery
22
<PAGE>
of consideration part or all of which shall be in a form other than cash, the
value of such consideration shall be as determined in good faith by the Board of
Directors of the Company, whose determination shall be described in a statement
filed with the Rights Agent. Shares of Preferred Stock owned by or held for the
account of the Company shall not be deemed outstanding for the purpose of any
such computation. Such adjustment shall be made successively whenever such a
record date is fixed; and in the event that such rights, options or warrants are
not so issued, the Purchase Price shall be adjusted to be the Purchase Price
which would then be in effect if such record date had not been fixed.
(c) In case the Company shall fix a record date for the making
of a distribution to all holders of Preferred Stock (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation) of evidences of indebtedness
or assets (other than a regular periodic cash dividend or a dividend payable in
Preferred Stock) or subscription rights or warrants (excluding those referred to
in Section 11(b)), the Purchase Price to be in effect after such record date
shall be determined by multiplying the Purchase Price in effect immediately
prior to such record date by a fraction, of which the numerator shall be the
Current Market Price per share of Preferred Stock (as defined in Section 11(d))
on such record date, less the fair market value (as determined in good faith by
the Board of Directors of the Company, whose determination shall be described in
a statement filed with the Rights Agent) of the portion of the assets or
evidences of indebtedness so to be distributed or of such subscription rights or
warrants applicable to one share of Preferred Stock and of which the denominator
shall be such Current Market Price per share of Preferred Stock. Such
adjustments shall be made successively whenever such a record date is fixed; and
in the event that such distribution is not so made, the Purchase Price shall
again be adjusted to be the Purchase Price which would then be in effect if such
record date had not been fixed.
(d)(i) For the purpose of any computation hereunder, other
than computations made pursuant to Section 11(a)(iii), the "Current Market
Price" per share of Common Stock on any date shall be deemed to be the average
of the daily closing prices per share of such Common Stock for the 30
consecutive Trading Days (as such term is hereinafter defined in this paragraph
(d)) immediately prior to such date and for purposes of computations made
pursuant to Section 11(a)(iii) hereof, the "Current Market Price" per share of
23
<PAGE>
Common Stock on any date shall be deemed to be the average of the daily closing
prices per share of such Common Stock for the ten (10) consecutive Trading Days
immediately following such date; provided, however, that in the event that the
Current Market Price per share of Common Stock is determined during the period
following the announcement by the issuer of such Common Stock of (A) a dividend
or distribution on such Common Stock payable in shares of such Common Stock or
securities convertible into shares of such Common Stock (other than the Rights)
or (B) any subdivision, combination or reclassification of such Common Stock,
and prior to the expiration of the requisite 30 Trading Day or 10 Trading Day
period, as set forth above after the ex-dividend date for such dividend or
distribution or the record date for such subdivision, combination or
reclassification, then, and in each such case, the Current Market Price shall be
appropriately adjusted to take into account ex-dividend trading. The closing
price for each day shall be the last sale price, regular way, or, in case no
such sale takes place on such day, the average of the closing bid and asked
prices, regular way, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the shares of the Common Stock are
not listed or admitted to trading on the New York Stock Exchange, as reported in
the principal consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange on which the
shares of the Common Stock are listed or admitted to trading or, if the shares
of the Common Stock are not listed or admitted to trading on any national
securities exchange, the last quoted price or, if not so quoted, the average of
the high bid and low asked prices in the over-the-counter market, as reported by
the National Association of Securities Dealers, Inc. Automated Quotation System
("NASDAQ") or such other system then in use, or, if on any such date the shares
of the Common Stock are not quoted by such organization, the average of the
closing bid and asked prices as furnished by a professional market maker making
a market in the Common Stock selected by the Board of Directors of the Company.
If on any such date no market maker is making a market in the Common Stock, the
fair value of such shares on such date shall be as determined in good faith by
the Independent Directors if the Independent Directors constitute a majority of
the Board of Directors or, in the event the Independent Directors do not
constitute a majority of the Board of Directors, by an independent investment
banking firm selected by the Board of Directors, whose determination shall be
described in a statement filed with the Rights Agent and shall be conclusive for
all purposes. The term "Trading Day" shall mean a day on which the principal
national securities exchange on which the shares of Common Stock are listed or
24
<PAGE>
admitted to trading is open for the transaction of business or, if the shares of
the Common Stock are not listed or admitted to trading on any national
securities exchange, a Monday, Tuesday, Wednesday, Thursday or Friday on which
banking institutions in the State of New York are not authorized or obligated by
law or executive order to close. If the Common Stock is not publicly held or not
so listed or traded, "Current Market Price" per share shall mean the fair value
per share as determined in good faith by the Independent Directors if the
Independent Directors constitute a majority of the Board of Directors or, in the
event the Independent Directors do not constitute a majority of the Board of
Directors, by an independent investment banking firm selected by the Board of
Directors, whose determination shall be described in a statement filed with the
Rights Agent and shall be conclusive for all purposes.
(ii) For the purpose of any computation hereunder, the
"Current Market Price" per share of Preferred Stock shall be determined in the
same manner as set forth above for the Common Stock in clause (i) of this
Section 11(d) (other than the last sentence thereof). If the Current
Market Price per share of Preferred Stock cannot be determined in the manner
provided above or if the Preferred Stock is not publicly held or listed or
traded in any manner described in clause (i) of this Section 11(d), the
"Current Market Price" per share of Preferred Stock shall be conclusively
deemed to be an amount equal to 1,000 (as such number may be appropriately
adjusted for such events as stock splits, stock dividends and recapitalizations
with respect to the Common Stock occurring after the date of this Agreement)
multiplied by the Current Market Price per share of the Common Stock. If
neither the Common Stock nor the Preferred Stock is publicly held or so listed
or traded, "Current Market Price" per share of the Preferred Stock
shall mean the fair value per share as determined in good faith by the Board of
Directors of the Company, whose determination shall be described in a statement
filed with the Rights Agent and shall be conclusive for all purposes. For all
purposes of this Agreement, the "Current Market Price" of one one-thousandths of
a share of Preferred Stock shall be equal to the "Current Market Price" of one
share of Preferred Stock divided by 1,000.
(e) Anything herein to the contrary notwithstanding, no
adjustment in the Purchase Price shall be required unless such adjustment would
require an increase or decrease of at least 1% in such price; provided, however,
-----------------
that any adjustments which by reason of this Section 11(e) are not required to
25
<PAGE>
be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made to the nearest
cent or to the nearest ten-thousandth of a share of Common Stock or one
millionth of a share of Preferred Stock as the case may be. Notwithstanding the
first sentence of this Section 11(e), any adjustment required by this Section 11
shall be made no later than the earlier of (i) three years from the date of the
transaction which mandates such adjustment or (ii) the Expiration Date.
(f) If as a result of an adjustment made pursuant to Section
11(a) or Section 13(a), the holder of any Right thereafter exercised shall
become entitled to receive any shares of capital stock other than shares of
Preferred Stock, thereafter the number of such other shares so receivable upon
exercise of any Right and the Purchase Price thereof shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the shares contained in Section
11(a) through (q), inclusive, and the provisions of Sections 7, 9, 10, 13 and 14
with respect to the Preferred Stock shall apply on like terms to any such other
shares.
(g) All Rights originally issued by the Company subsequent to
any adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of one one-thousandths of a
share of Preferred Stock purchasable from time to time hereunder upon exercise
of the Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as
provided in section 11(i), upon each adjustment of the Purchase Price as a
result of the calculations made in Section 11(b) and (c), each Right outstanding
immediately prior to the making of such adjustment shall thereafter evidence the
right to purchase, at the adjusted Purchase Price, that number of shares
(calculated to the nearest one-millionth) obtained by (i) multiplying (x) the
number of shares covered by a Right immediately prior to this adjustment by (y)
the Purchase Price in effect immediately prior to such adjustment of the
Purchase Price and (ii) dividing the product so obtained by the Purchase Price
in effect immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights, in substitution
for any adjustment in the number of shares of Preferred Stock purchasable upon
26
<PAGE>
the exercise of a Right. Each of the Rights outstanding after such adjustment of
the number of Rights shall be exercisable for the number of shares of Preferred
Stock for which a Right was exercisable immediately prior to such adjustment.
Each Right held of record prior to such adjustment of the number of Rights shall
become that number of Rights (calculated to the nearest ten-thousandth) obtained
by dividing the Purchase Price in effect immediately prior to adjustment of the
Purchase Price by the Purchase Price in effect immediately after the adjustment
of the Purchase Price. The Company shall make a public announcement and shall
give simultaneous written notice to the Rights Agent of its election to adjust
the number of Rights, indicating the record date for the adjustment to be made.
This record date may be the date on which the Purchase Price is adjusted or any
day thereafter, but, if the Right Certificates have been issued, shall be at
least 10 days later than the date of the public announcement. If Right
Certificates have been issued, upon each adjustment of the number of Rights
pursuant to this Section 11(i), the Company shall, as promptly as practicable,
cause to be distributed to holders of Right Certificates on such record date
Right Certificates evidencing, subject to Section 14, the additional Rights to
which such holders shall be entitled as a result of such adjustment, or, at the
option of the Company, shall cause to be distributed to such holders of record
in substitution and replacement for the Right Certificates held by such holders
prior to the date of adjustment, and upon surrender thereof, if required by the
Company, new Right Certificates evidencing all the Rights to which such holders
shall be entitled after such adjustment. Right Certificates so to be distributed
shall be issued, executed and countersigned in the manner provided for herein
(and may bear, at the option of the Company, the adjusted Purchase Price) and
shall be registered in the names of the holders of record of Right Certificates
on the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase
Price or the number of shares of Preferred Stock issuable upon the exercise of
the Rights, the Right Certificates theretofore and thereafter issued may
continue to express the Purchase Price per share and the number of shares which
were expressed in the initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an adjustment
reducing the Purchase Price below one one-thousandth of the then stated value,
if any, of a share of Preferred Stock issuable upon exercise of the Rights, the
Company shall take any corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and legally issue
27
<PAGE>
fully paid and nonassessable such number of one one-thousandths of a share of
such Preferred Stock at such adjusted Purchase Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuance to the holder of any Right exercised after such record date
the shares of Preferred Stock and other capital stock or securities of the
Company, if any, issuable upon such exercise over and above the shares of
Preferred Stock and other capital stock or securities of the Company, if any,
issuable upon such exercise on the basis of the Purchase Price in effect prior
to such adjustment; provided, however, that the Company shall deliver to such
holder a due bill or other appropriate instrument evidencing such holder's right
to receive such additional shares upon the occurrence of the event requiring
such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such reductions in the
Purchase Price, in addition to those adjustments expressly required by this
Section 11, as and to the extent that the Board of Directors of the Company
shall determine to be advisable in order that any consolidation or subdivision
of shares of Preferred Stock, issuance wholly for cash of any of shares of
Preferred Stock at less than the Current Market Price, issuance wholly for cash
of the Preferred Stock or securities which by their terms are convertible into
or exchangeable for Preferred Stock, stock dividends or issuance of rights,
options or warrants referred to hereinabove in this Section 11, hereafter made
by the Company to holders of its Preferred Stock shall not be taxable to such
stockholders.
(n) The Company covenants and agrees that, after the
Distribution Date, it will not, except as permitted by Sections 23, 24 and 27
hereof, take (nor will it permit any of its Subsidiaries to take) any action if
at the time such action is taken it is reasonably foreseeable that such action
will diminish substantially or otherwise eliminate the benefits intended to be
afforded by the Rights.
(o) The Company covenants and agrees that it shall not, at any
time after the Distribution Date, (i) consolidate with any other Person (other
than a Subsidiary of the Company in a transaction which complies with Section
11(n)), (ii) merge with or into any other Person (other than a Subsidiary of the
28
<PAGE>
Company in a transaction which complies with Section 11(n)), or (iii) sell or
transfer (or permit any of its Subsidiaries to sell or transfer), in one or more
transactions, assets or earning power aggregating more than 50% of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to, any
other Person or Persons (other than the Company and/or any of its Subsidiaries
in one or more transactions each of which complies with Section 11(n)) if (x) at
the time of or immediately after such consolidation, merger or sale there are
any rights, warrants or other instruments or securities outstanding or
agreements in effect which would substantially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights or (y) prior to,
simultaneously with or immediately after such consolidation, merger or sale, the
stockholders of the Person who constitutes, or would constitute, the "Principal
Party" 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.
(p) Anything in this Agreement to the contrary
notwithstanding, in the event that the Company shall at any time after the
Record Date and prior to the Distribution Date (i) declare a dividend on the
outstanding shares of Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding shares of Common Stock, or (iii) combine the
outstanding shares of Common Stock into a smaller number of shares, the number
of Rights associated with each share of Common Stock then outstanding, or issued
or delivered thereafter but prior to the Distribution Date, shall be
proportionately adjusted so that the number of Rights thereafter associated with
each share of Common Stock following any such event shall equal the result
obtained by multiplying the number of Rights associated with each share of
Common Stock immediately prior to such event by a fraction, the numerator of
which shall be the total number of shares of Common Stock outstanding
immediately prior to the occurrence of the event and the denominator of which
shall be the total number of shares of Common Stock outstanding immediately
following the occurrence of such event.
(q) Notwithstanding anything in this Agreement to the
contrary, prior to the Distribution Date, the Company may, in lieu of making any
adjustment to the Purchase Price, the number of shares of Preferred Stock
eligible for purchase on exercise of each Right or the number of Rights
outstanding, which adjustment would otherwise be required by Section 11(a)(i),
11(b), 11(c), 11(h) or 11(i), make such other equitable adjustment or
adjustments thereto as the Board of Directors (whose determination shall be
conclusive) deems appropriate in the circumstances and not inconsistent with the
29
<PAGE>
objectives of the Board of Directors in adopting this Agreement and such
Sections.
Section 12. Certificate of Adjusted Purchase Price or Number
-------------------------------------------------
of Shares. Whenever an adjustment is made as provided in Sections 11 and 13, the
- ---------
Company shall (a) promptly prepare a certificate setting forth such adjustment,
and a brief statement of the facts accounting for such adjustment and the
adjusted Purchase Price, (b) promptly file with the Rights Agent and with each
transfer agent for the Preferred Stock and the Common Stock a copy of such
certificate and (c) mail a brief summary thereof to each holder of a Right
Certificate in accordance with Section 26. The Rights Agent shall be fully
protected in relying on any such certificate and on any adjustment therein
contained.
Section 13. Consolidation, Merger or Sale or Transfer of
------------------------------------------------
Assets or Earning Power. (a) In the event that, following the Shares Acquisition
- -----------------------
Date, directly or indirectly, (x) the Company shall consolidate with, or merge
with and into, any other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(n)) and the Company shall not be the
continuing or surviving corporation of such consolidation or merger, (y) any
Person (other than a Subsidiary of the Company in a transaction which complies
with Section 11(n)) shall consolidate, merge with and into the Company and the
Company shall be the continuing or surviving corporation of such consolidation
or merger and, in connection with such consolidation or merger, all or part of
the Common Stock shall be changed into or exchanged for stock or other
securities of any other Person or cash or any other property, or (z) the Company
shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell
or otherwise transfer), in one or more transactions, assets or earning power
aggregating more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person or Persons (other than the
Company or any of its Subsidiaries in one or more transactions each of which
complies with Section 11(n) hereof), then, and in each such case proper
provision shall be made so that (i) each holder of a Right (except as provided
in Section 7(e)) shall thereafter have the right to receive, upon the exercise
thereof at the then current Purchase Price in accordance with the terms of this
Agreement, such number of validly issued, fully paid, non-assessable and freely
tradable shares of Common Stock of the Principal Party (as hereinafter defined),
not subject to any liens, encumbrances, rights of call or first refusal, or
other adverse claims as shall be equal to the result obtained by (1) multiplying
30
<PAGE>
the then current Purchase Price by the then number of one one-thousandths of a
share of Preferred Stock for which a Right is exercisable immediately prior to
the first occurrence of a Section 13 Event (or, if a Section 11(a)(ii) Event has
occurred prior to the first occurrence of a Section 13 Event, multiplying the
number of such one one-thousandths of a share for which a Right was exercisable
immediately prior to the first occurrence of a Section 11(a)(ii) Event by the
Purchase Price in effect immediately prior to such first occurrence), and
dividing that product (which, following the first occurrence of a Section 13
Event, shall be referred to as the "Purchase Price" for each Right and for all
purposes of this Agreement) by (2) 50% of the Current Market Price per share of
the Common Stock of such Principal Party (determined in the manner described in
Section 11(d)) on the date of consummation of such consolidation, merger, sale
or transfer; (ii) the Principal Party shall thereafter be liable for, and shall
assume, by virtue of such Section 13 Event, all the obligations and duties of
the Company pursuant to this Agreement; (iii) the term "Company" shall
thereafter be deemed to refer to such Principal Party, it being specifically
intended that the provisions of Section 11 shall thereafter apply to such
Principal Party; (iv) such Principal Party shall take such steps (including, but
not limited to, the reservation of a sufficient number of shares of its Common
Stock in accordance with Section 9) in connection with such consummation as may
be necessary to assure that the provisions hereof shall thereafter be
applicable, as nearly as reasonably may be, in relation to the shares of its
Common Stock thereafter deliverable upon the exercise of the Rights; and (v) the
provisions of Section 11(a)(ii) hereof shall be of no effect following the first
occurrence of any Section 13 Event.
(b) "Principal Party" shall mean
(1) in the case of any transaction described in (x) or (y) of
the first sentence of Section 13(a), the Person that is the issuer of
any securities into which shares of Common Stock of the Company are
converted in such merger or consolidation, and if no securities are so
issued, the Person that is the other party to the merger or
consolidation; and
(2) in the case of any transaction described in (z) of the
first sentence in this Section 13, the Person that is the party
receiving the greatest portion of the assets or earning power
transferred pursuant to such transaction or transactions;
31
<PAGE>
provided, however, that in any such case, (x) if the Common Stock of such Person
- -----------------
is not at such time and has not been continuously over the preceding 12-month
period registered under Section 12 of the Exchange Act, and such Person is a
direct or indirect Subsidiary of another corporation the Common Stock of which
is and has been so registered, "Principal Party" shall refer to such other
corporation; (y) if such Person is a Subsidiary, directly or indirectly, of more
than one corporation, the Common Stocks of two or more of which are and have
been so registered, "Principal Party" shall refer to whichever of such
corporations is the issuer of the Common Stock having the greatest market value.
(c) The Company shall not consummate any Section 13 Event
unless all regulatory approvals for the consummation of such Section 13 Event
and the exercise of the Rights in accordance with the terms of this Agreement
have been obtained and the Principal Party shall have a sufficient number of
authorized shares of its Common Stock which are neither outstanding nor reserved
for issuance to permit the exercise in full of the Rights in accordance with
this Section 13 and unless prior thereto the Company and such Principal Party
shall have executed and delivered to the Rights Agent a supplemental agreement
providing for the terms set forth in paragraphs (a) and (b) of this Section 13
and further providing that, as soon as practicable after the date of any
consolidation, merger or sale of assets mentioned in paragraph (a) of this
Section 13, the Principal Party will
(i) prepare and file a registration statement under the Act
with respect to the Rights and the securities purchasable upon exercise
of the Rights on an appropriate form, will use its best efforts to
cause such registration statement to become effective as soon as
practicable after such filing and will use its best efforts to cause
such registration statement to remain effective (with a prospectus at
all times meeting the requirements of the Act) until the Expiration
Date; and
(ii) will deliver to holders of the Rights historical
financial statements for the Principal Party and each of its Affiliates
which comply in all respects with the requirements for registration on
Form 10 under the Exchange Act.
The provisions of this Section 13 shall similarly apply to successive Section 13
Events. In the event that a Section 13 Event shall occur at any time after the
32
<PAGE>
occurrence of a Section 11(a)(ii) Event, the Rights which have not theretofore
been exercised shall thereafter become exercisable in the manner described in
Section 13(a).
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 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 listed or admitted to trading or, if the Rights are not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by NASDAQ or such other
system then in use or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights selected by the Board of
Directors of the Company. If on any such date no such market maker is making a
market in the Rights the fair value of the Rights on such date as determined in
good faith by the Board of Directors of the Company shall be used.
(b) The Company shall not be required to issue fractions of
shares of Preferred Stock (other than fractions which are integral multiples of
one one-thousandth of a share of Preferred Stock) upon exercise of the Rights or
to distribute certificates which evidence fractional shares (other than
fractions which are integral multiples of one one-thousandth of a share of
Preferred Stock). In lieu of fractional shares that are not integral multiples
of one one-thousandth of a share of Preferred Stock, the Company may pay to the
33
<PAGE>
registered holders of Right Certificates at the time the Rights evidenced
thereby are exercised or exchanged as herein provided an amount in cash equal to
the same fraction of the current market value of one one-thousandth of a share
of Preferred Stock. For purposes of this Section 14(b), the current market value
of one one-thousandth of a share of Preferred Stock shall be one one-thousandth
of the closing price of a share of Preferred Stock (as determined pursuant to
Section 11(d)(ii)) for the Trading Day immediately prior to the date of such
exercise.
(c) Following the occurrence of a Triggering Event the Company
shall not be required to issue fractions of shares of Class A Common Stock upon
exercise of the Rights or to distribute certificates which evidence fractional
shares of Class A Common Stock. In lieu of fractional shares of Class A Common
Stock, the Company may pay to the registered holders of Right Certificates at
the time such Rights are exercised as herein provided an amount in cash equal to
the same fraction of the current market value of one (1) share of Class A Common
Stock. For purposes of this Section 14(c), the current market value of one share
of Class A Common Stock shall be the closing price of one share of Class A
Common Stock (as determined pursuant to Section 11(d)(i) hereof) for the Trading
Day immediately prior to the date of such exercise.
(d) The holder of a Right by the acceptance of the Rights
expressly waives his right to receive any fractional Rights or any fractional
shares upon exercise of a Right, except as otherwise permitted by this Section
14.
Section 15. Rights of Action. All rights of action in respect
----------------
of this Agreement are vested in the respective registered holders of the Right
Certificates (and, prior to the Distribution Date, the registered holders of the
Common Stock); and any registered holder of any Right Certificate (or, prior to
the Distribution Date, of the Common Stock), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Stock), may, 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 respect of, his right to
exercise the Rights evidenced by such Right Certificate in the manner provided
in such Right Certificate and in this Agreement. Without limiting the foregoing
or any remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and will be entitled to specific performance of
the obligations hereunder and injunctive relief against actual or threatened
34
<PAGE>
violations of the obligations hereunder of any Person subject to this Agreement.
Section 16. Agreement of Right Holders. Every holder of a
--------------------------
Right by accepting the same consents and agrees with the Company and the
Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common Stock;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if
surrendered at the office of the Rights Agent designated for such
purpose, duly endorsed or accompanied by a proper instrument of
transfer and with the appropriate forms and certificates fully
executed, along with a signature guarantee and such other and further
documentation as the Rights Agent may reasonably request;
(c) subject to Section 6 and Section 7(f) hereof, the Company
and the Rights Agent may deem and treat the Person in whose name the
Right Certificate (or, prior to the Distribution Date, the associated
Common Stock certificate) is registered as the absolute owner thereof
and of the Rights evidenced thereby (notwithstanding any notations of
ownership or writing on the Right Certificates or the associated Common
Stock certificate made by anyone other than the Company or the Rights
Agent) for all purposes whatsoever, and neither the Company nor the
Rights Agent shall be required to be affected by any notice to the
contrary;
(d) notwithstanding anything in this Agreement to the
contrary, neither the Company nor the Rights Agent shall have any
liability to any holder of a Right or other Person as a result of its
inability to perform any of its obligations under this Agreement by
reason of any preliminary or permanent injunction or other order,
decree or ruling issued by a court of competent jurisdiction or by a
governmental, regulatory or administrative agency or commission, or any
statute, rule, regulation or executive order promulgated or enacted by
any governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, the Company must use
-----------------
35
<PAGE>
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 Stockholder.
-------------------------------------------------
No holder, as such, of any Right Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of the number of shares of
Preferred Stock or any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby, nor shall anything
contained herein or in any Right Certificate be construed to confer upon the
holder of any Right Certificate, as such, any of the rights of a 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 stockholders (except as provided in Section 25), or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by such Right Certificate shall have been exercised in accordance with
the provisions hereof.
Section 18. Concerning the Rights Agent. The Company agrees to
---------------------------
pay to the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and other disbursements incurred in the administration
and execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent for, and to
hold it harmless against, any loss, liability, or expense, incurred without
negligence, bad faith or willful misconduct on the part of the Rights Agent
(including the reasonable fees and expenses of counsel), 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 in the premises. Anything to the contrary notwithstanding, in
no event shall the Rights Agent be liable for special, indirect, consequential
or incidental loss or damage of any kind whatsoever (including but not limited
to lost profits), even if the Rights Agent has been advised of the likelihood of
such loss or damage.
The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or omitted by it in
connection with its administration of this Agreement in reliance upon any Right
Certificate or certificate for Common Stock or for other securities of the
Company, instrument of assignment or transfer, power of attorney, endorsement,
36
<PAGE>
affidavit, letter, notice, direction, consent, instruction, adjustment notice,
certificate, statement, or other paper or document believed by it to be genuine
and to be signed, executed and, where necessary, verified or acknowledged, by
the proper Person or Persons.
In addition to the foregoing, the Rights Agent shall be
protected and shall incur no liability for, or in respect of, any action taken
or omitted by it in connection with its administration of this Agreement in
reliance upon (i) the proper execution of the certification concerning
beneficial ownership appended to the Form of Assignment and the Form of Election
to Purchase included as part of Exhibit B hereto (the "Certification"), unless
the Rights Agent shall have actual knowledge that, as executed, the
Certification is untrue or (ii) the non-execution or failure to complete the
Certification including, without limitation, any refusal to honor any otherwise
permissible assignment or election by reason of such non-execution or failure.
Section 19. Merger or Consolidation or Change of Name of
--------------------------------------------
Rights Agent. Any corporation into which the Rights Agent or any successor
- ------------
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights Agent
or any successor Rights Agent shall be a party, or any corporation, succeeding
to the corporate trust business of the Rights Agent or any successor Rights
Agent, shall be the successor to the Rights Agent under this Agreement without
the execution or filing of any paper or any further act on the part of any of
the parties hereto, provided that such corporation would be eligible for
appointment as a successor Rights Agent under the provisions of Section 21. In
case at the time such successor Rights Agent shall succeed to the agency created
by this Agreement, any of the Right Certificates shall have been countersigned
but not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor so countersigned; and in case at that time
any of the Right Certificates shall not have been countersigned, any successor
Rights Agent may countersign such Right Certificates either in the name of the
predecessor Rights Agent or in the name of the successor Rights Agent; and in
all such cases such Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the countersignature
37
<PAGE>
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 the 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, any Vice President, the Treasurer or the Secretary of the
Company and delivered to the Rights Agent; and such certificate shall
be full authorization to the Rights Agent for any action taken or
suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its
own negligence, bad faith or willful misconduct. The issuance or
non-issuance of a Right Certificate or Preferred Stock or other
security issued in lieu of Preferred Stock in accordance with
instructions given to the Rights Agent by the Company pursuant to
Section 20(k) hereof or in accordance with the terms hereof shall not
constitute 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
38
<PAGE>
be required to verify the same, but all such statements and recitals
are and shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery
hereof (except the due execution hereof by the Rights Agent) or in
respect of the validity or execution of any Right Certificate (except
its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this
Agreement or in any Right Certificate; nor shall it be responsible for
any adjustment required under the provisions of Sections 11 or 13 or
responsible for the manner, method or amount of any such adjustment or
the ascertaining of the existence of facts that would require any such
adjustment (except with respect to the exercise of Rights evidenced by
Right Certificates after actual notice of any such adjustment); nor
shall it by any act hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any shares of
Preferred Stock or Common Stock to be issued pursuant to this Agreement
or any Right Certificate or as to whether any shares of Preferred Stock
or Common Stock 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 and certificates delivered pursuant to any provision hereof
from any one of the Chairman of the Board, the President, any Vice
President, the Secretary or the Treasurer of the Company, and is
authorized to apply to such officers for advice or instructions in
connection with its duties, and it shall not be liable for any action
taken or suffered to be taken by it in good faith in accordance with
instructions of any such officer. An application by the Rights Agent
for instructions may set forth in writing any action proposed to be
taken or omitted by the Rights Agent with respect to its duties and
39
<PAGE>
obligations under this Agreement and the date on and/or after which
such action shall be taken, and the Rights Agent shall not be liable
for any action taken or omitted in accordance with a proposal included
in any such application on or after the date specified therein (which
date shall not be less than one Business Day after the Company receives
such application) without the consent of the Company unless prior to
taking or omitting such action, the Rights Agent has received written
instructions in response to application specifying the actions to be
taken or omitted.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights
or other securities of the Company or become pecuniarily interested in
any transaction in which the Company may be interested, or contract
with or lend money to the Company or otherwise act as fully and freely
as though it were not Rights Agent under this Agreement. Nothing herein
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 by itself or by or through its attorneys or agents, and the
Rights Agent shall not be answerable or accountable for any act,
default, neglect or misconduct of any such attorneys or agents or for
any loss to the Company resulting from any such act, default, neglect
or misconduct; provided, however, reasonable care was exercised in the
selection thereof.
(j) No provision of this Agreement shall require the Rights
Agent to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder or in the
exercise of its rights if there shall be reasonable grounds for
believing that repayment of such funds or adequate indemnification
against such risk or liability is not reasonably assured to it.
(k) If, with respect to any Rights Certificate surrendered to
the Rights Agent for exercise or transfer, the certificate attached to
the form of assignment or form of election to purchase, as the case may
be, has either not been completed or indicates an affirmative response,
the Rights Agent shall not take any further action with respect to such
requested exercise or transfer without first consulting the Company.
40
<PAGE>
The Company shall give the Rights Agent prompt written instructions as
to the action to be taken regarding the Rights Certificates involved.
The Rights Agent shall not be liable for acting in accordance with such
instructions.
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 thirty (30) days' notice in writing mailed to the Company and to
each transfer agent of the Preferred Stock and the Common Stock by registered or
certified mail, and, at the Company's expense, to the holders of the Right
Certificates by first class mail. The Company may remove the Rights Agent or any
successor Rights Agent upon thirty (30) days' notice in writing, mailed to the
Rights Agent or successor Rights Agent, as the case may be, and to each transfer
agent of the Preferred Stock and the Common Stock by registered or certified
mail, and to the holders of the Right Certificates by first-class mail. If the
Rights Agent shall resign or be removed or shall otherwise become incapable of
acting, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of thirty (30) days
after giving notice of such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Rights Agent or
by the holder of a Right Certificate (who shall, with such notice, submit his
Right Certificate for inspection by the Company), then the Company shall become
the temporary Rights Agent and the registered holder of any Right Certificate
may apply to any court of competent jurisdiction for the appointment of a new
Rights Agent. Any successor Rights Agent, whether appointed by the Company or by
such a court, shall be a corporation organized and doing business under the laws
of the United States or of the State of New York (or of any other state of the
United States so long as such corporation is authorized to do business as a
banking or trust institution in the State of New York), in good standing, having
a principal office in the State of New York, which is authorized under such laws
to exercise corporate trust powers and is subject to supervision or examination
by federal or state authority or which has at the time of its appointment as
Rights Agent a combined capital and surplus of at least $25 million. After
appointment, the successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as Rights
Agent without further act or deed; but the predecessor Rights Agent shall
41
<PAGE>
deliver and transfer to the successor Rights Agent any property at the time held
by it hereunder, and execute and deliver any further assurance, conveyance, act
or deed necessary for the purpose. Not later than the effective date of any such
appointment the Company shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Preferred Stock and the
Common Stock, and mail a notice thereof in writing to the registered holders of
the Right Certificates. Failure to give any notice provided for in this Section
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 Board of Directors
to reflect any adjustment or change in the Purchase Price and the number
or kind or class of shares or other securities or property purchasable
under the Right Certificates made in accordance with the provisions of this
Agreement. In addition, in connection with the issuance or sale of shares of
Common Stock following the Distribution Date and prior to the redemption or
expiration the Rights, the Company (a) shall, with respect to shares of Common
Stock so issued or sold pursuant to the exercise of stock options or under any
employee plan or arrangement, or upon the exercise, conversion or exchange of
securities hereinafter issued by the Company, and (b) may, in any other case, if
deemed necessary or appropriate by the Board of Directors of the Company, issue
Right Certificates representing the appropriate number of Rights in connection
with such issuance or sale; provided, however, 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 would be issued, and (ii) no such Right Certificate shall be
issued if, and to the extent that, appropriate adjustment shall otherwise have
been made in lieu of the issuance thereof.
Section 23. Redemption and Termination. (a) The Board of
----------------------------
Directors of the Company may, at its option, at any time prior to the earlier of
(x) the close of business on the tenth calendar day following the Shares
Acquisition Date (or if the Shares Acquisition Date shall have occurred prior to
the Record Date, the close of business on the tenth day following the Record
Date), or (y) the Final Expiration Date, redeem all but not less than all of the
then outstanding Rights at a redemption price of $.001 per Right as
appropriately adjusted to reflect any stock split, stock dividend or similar
42
<PAGE>
transaction occurring after the date hereof (such redemption price being
hereinafter referred to as the "Redemption Price"), and the Company may, at its
option, pay the Redemption Price either in shares of its Common Stock (valued at
their Current Market Price as defined in Section 11(d)(i) on the date of the
redemption), other securities, cash or other assets; provided, however, that if
the Board of Directors of the Company authorizes redemption of the Rights on or
after the Shares Acquisition Date, then there must be Independent Directors in
office and such authorization shall require the concurrence of a majority of the
Independent Directors. Notwithstanding anything contained in this Agreement to
the contrary, the Rights shall not be exercisable after the first occurrence of
a Section 11(a)(ii) Event until such time as the Company's right of redemption
hereunder has expired.
(b) In deciding whether or not to exercise the Company's right
of redemption hereunder, the Board of Directors of the Company shall act in good
faith, in a manner they reasonably believe to be in the best interests of the
Company and with such care, including reasonable inquiry, skill and diligence,
as a person of ordinary prudence would use under similar circumstances, and they
may consider the long-term and short-term effects of any action upon employees,
customers and creditors of the Company and upon communities in which offices or
other establishments of the Company are located, and all other pertinent
factors.
(c) Immediately upon the action of the Board of Directors of
the Company ordering the redemption of the Rights, and without any further
action and without any notice, the right to exercise the Rights will terminate
and the only right thereafter of the holders of Rights shall be to receive the
Redemption Price for each Right held. Within 10 days after the action of the
Board of Directors ordering the redemption of the Rights, the Company shall give
notice of such redemption to the holders of the then outstanding Rights by
mailing such notice to the Rights Agent and to all such holders at their last
addresses as they appear upon the registry books of the Rights Agent or, prior
to the Distribution Date, on the registry books of the transfer agent for the
Common Stock. Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each such notice of
redemption will state the method by which the payment of the Redemption Price
will be made. Neither the Company nor any of its Affiliates or Associates may
redeem, acquire or purchase for value any Rights at any time in any manner other
43
<PAGE>
than that specifically set forth in this Section 23, and other than in
connection with the repurchase of Common Stock prior to the Distribution Date.
Section 24. Exchange. (a) The Board of Directors of the
--------
Company may, at its option (provided that there are then Independent Directors
in office and a majority of the Independent Directors concur), at any time and
from time to time on or after a Section 11(a)(ii) Event, exchange all or
part of the then outstanding and exercisable Rights (which shall not
include Rights that have become void pursuant to the provisions of
Section 7(e) hereof) for shares of Class A Common Stock at an exchange
ratio of one share of Class A Common Stock per Right, appropriately
adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof (such exchange ratio being
hereinafter referred to as the "Exchange Ratio").
(b) Immediately upon the action of the Board of Directors of
the Company ordering the exchange of any Rights pursuant to Section 24(a) and
without any further action and without any notice, the right to exercise such
Rights shall terminate and the only right thereafter of a holder of such Rights
shall be to receive that number of shares of Class A Common Stock equal to the
number of such Rights held by such holder multiplied by the Exchange Ratio.
Promptly after the action of the Board of Directors ordering an exchange of the
Rights, the Company shall give notice of any such exchange to the Rights Agent
and the holders of the then outstanding Rights by mailing such notice to all
such holders at each holder's last address as it appears upon the registry books
of the Rights Agent; provided, however, that the failure to give, or any defect
in, such notice shall not affect the validity of such exchange. Any notice which
is mailed in the manner herein provided shall be deemed given, whether or not
the holder receives the notice. Each such notice of exchange will state the
method by which the exchange of the shares of Class A Common Stock for Rights
will be effected and, in the event of any partial exchange, the number of Rights
which will be exchanged. Any partial exchange shall be effected pro rata based
on the number of Rights (other than Rights which have become void pursuant to
the provisions of Section 7(e) hereof) held by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the Company,
at its option, may substitute shares of Preferred Stock (or Equivalent Preferred
Stock, as such term is defined in Section 11(b) hereof) for shares of Class A
Common Stock exchangeable for the Rights, at the initial rate of one
one-thousandth of a share of Preferred Stock (or Equivalent Preferred Stock) for
44
<PAGE>
each share of Class A Common Stock, as appropriately adjusted to reflect
adjustments in the dividend rights of the Preferred Stock pursuant to the terms
thereof.
(d) In the event that there shall not be sufficient shares of
Class A Common Stock or Preferred Stock issued, but not outstanding, or
authorized but unissued, to permit any exchange of Rights as contemplated in
accordance with this Section 24 or that any regulatory actions or approvals are
required in connection therewith, the Company shall take all such action as may
be necessary to authorize additional Class A Common Stock or Preferred Stock for
issuance upon exchange of the Rights.
(e) The Company shall not be required to issue fractional
shares of Class A Common Stock or to distribute certificates which evidence
fractional shares of Class A Common Stock pursuant to this Section 24. In lieu
of such fractional shares of Class A Common Stock, the Company shall pay to the
registered holders of the Right Certificates with regard to which such
fractional shares of Class A Common Stock would otherwise be issuable an amount
in cash equal to the same fraction of the current market value of a whole share
of Class A Common Stock. For the purposes of this Section 24(e), the current
market value of a whole share of Class A Common Stock shall be the closing price
of a share of Class A Common Stock (as determined pursuant to the second
sentence of Section 11(d)(i) hereof) for the Trading Day immediately prior to
the date of exchange pursuant to this Section 24.
(f) In any exchange pursuant to this Section 24, the Company,
at its option, may substitute for any share of Class A Common Stock exchangeable
for a Right (i) Common Stock Equivalents (ii) cash, (iii) debt securities of the
Company, (iv) other assets, or (v) any combination of the foregoing, having an
aggregate value which a majority of the Independent Directors and the Board of
Directors of the Company shall have determined in good faith to be equal to the
Current Market Price of one share of Class A Common Stock (determined pursuant
to Section 11(d) hereof) on the Trading Date immediately preceding the date of
exchange pursuant to this Section 24.
Section 25. Notice of Certain Events. In case the Company
-------------------------
shall propose at any time following the Distribution Date (a) to pay any
dividend payable in stock of any class to the holders of Preferred Stock or to
make any other distribution to the holders of Preferred Stock (other than a
regular periodic cash dividend), or (b) to offer to the holders of Preferred
45
<PAGE>
Stock rights or warrants to subscribe for or to purchase any additional shares
of Preferred Stock or shares of stock of any class or any other securities,
rights or options, or (c) to effect any reclassification of Preferred Stock
(other than a reclassification involving only the subdivision of outstanding
Preferred Stock), or (d) to effect any consolidation or merger into or with any
other Person (other than a Subsidiary of the Company in a transaction which
complies with Section 11(n) hereof), or to effect any sale or other transfer (or
to permit one or more of its Subsidiaries to effect any sale or other transfer),
in one or more transactions, of more than 50% of the assets or earning power of
the Company and its Subsidiaries (taken as a whole) to, any other Person or
Persons (other than the Company and/or any of its Subsidiaries in one or more
transactions each of which complies with Section 11(n) hereof), or (e) to effect
the liquidation, dissolution or winding up of the Company, then, in each such
case, the Company shall give to the Rights Agent and to each holder of a Right,
in accordance with Section 26, a notice of such proposed action, which shall
specify the record date for the purposes of such stock dividend, distribution of
rights or Rights, or the date on which such reclassification, consolidation,
merger, sale, transfer, liquidation, dissolution, or winding up is to take place
and the date of participation therein by the holders of the Preferred Stock, if
any such date is to be fixed, and such notice shall be so given in the case of
any action covered by clause (a) or (b) above at least twenty (20) days prior to
the record date for determining holders of the Preferred Stock for purposes of
such action, and in the case of any such other action, at least twenty (20) days
prior to the date of the taking of such proposed action or the date of
participation therein by the holders of the Preferred Stock, whichever shall be
the earlier.
In case a Section 11(a)(ii) Event shall occur, then, in any
such case, the Company shall as soon as practicable thereafter give to the
Rights Agent and to each holder of a Right, to the extent feasible and in
accordance with Section 26, a notice of the occurrence of such event, which
shall specify the event and the consequences of the event to holders of Rights
under Section 11(a)(ii) and all references in the preceding paragraph to
Preferred Stock shall be deemed to thereafter refer to Class A Common Stock
and/or other securities, as the case may be.
Section 26. Notices. Notices or demands authorized by this
Agreement to be given or made by the Rights Agent or by the holder of any Right
46
<PAGE>
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:
Lexmark International Group, Inc.
One Lexmark Centre Drive
740 New Circle Road NW
Lexington, Kentucky 40550
Attention: General Counsel
Subject to the provisions of Section 21, 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:
ChaseMellon Shareholder Services, L.L.C.
450 West 33rd Street
15th Floor
New York, New York 10001
Attention: Frank Misciagna
Notices or demands authorized by this Agreement to be given or
made by the Company or the Rights Agent to the holder of any Right Certificate
shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed to such holder at the address of such holder as shown on the
registry books of the Company.
Section 27. Supplements and Amendments. Prior to the earlier
--------------------------
of the Distribution Date or the Shares Acquisition Date and subject to the
ultimate sentence of this Section 27, the Company may from time to time
supplement or amend this Agreement without the approval of any holders of Right
Certificates. From and after the earlier of the Distribution Date or the Shares
Acquisition Date, and subject to the penultimate sentence of this Section 27,
the Company may from time to time supplement or amend this Agreement without the
approval of any holders of Right Certificates in order (i) to cure any
ambiguity, (ii) to correct or supplement any provision contained herein which
may be defective or inconsistent with any other provisions herein, or (iii) to
lengthen the time period during which the Rights may be redeemed following the
Shares Acquisition Date for up to an additional twenty days beyond the time
period set forth in Section 23(a) (provided that any such lengthening shall be
effective only if there are Independent Directors and shall require the
47
<PAGE>
concurrence of a majority of such Independent Directors), or (iv) to change or
supplement the provisions hereunder in any manner which the Company may deem
necessary or desirable and which shall not adversely affect the interests of the
holders of Right Certificates (other than an Acquiring Person or an Affiliate or
Associate of an Acquiring Person). Upon the delivery of a certificate from an
appropriate officer of the Company which states that the proposed supplement or
amendment is in compliance with the terms of this Section 27, the Rights Agent
shall execute such supplement or amendment unless the Rights Agent shall have
determined in good faith that such supplement or amendment would adversely
affect its interests under this Agreement. Notwithstanding anything in this
Agreement to the contrary, no supplement or amendment shall be made on or after
the Distribution Date which changes the Redemption Price, the Final Expiration
Date, the Purchase Price or the number of shares of Preferred Stock for which a
Right is then exercisable.
Section 28. Successors. All the covenants and provisions
----------
of this Agreement by or for the benefit of the Company or the Rights Agent
shall bind and inure to the benefit of their respective successors and assigns
hereunder.
Section 29. Determinations and Actions by the Board of
------------------------------------------------
Directors. For all purposes of this Agreement, any calculation of the number of
- ---------
shares of Common Stock outstanding at any particular time, including for
purposes of determining the particular percentage of such outstanding shares of
Common Stock of which any Person is the Beneficial Owner, shall be made in
accordance with the provisions of Rule 13d-3(d)(1)(i) of the General Rules and
Regulations under the Exchange Act. The Board of Directors of the Company (and,
where specifically provided for herein, the Independent Directors) shall have
the exclusive power and authority to administer this Agreement and to exercise
all rights and powers specifically granted to the Board or the Company (or, as
expressly provided, the Independent Directors), or as may be necessary or
advisable in the administration of this Agreement, including, without
limitation, the right and power to (i) interpret the provisions of this
Agreement, and (ii) make all determinations deemed necessary or advisable for
the administration of this Agreement (including a determination to redeem or not
redeem the Rights or to amend the Agreement). All such actions, calculations,
interpretations and determinations (including, for the purpose of clause (ii)
below, all omissions with respect to the foregoing) which are done or made by
the Board (or, as provided for, by the Independent Directors) in good faith,
shall (i) be final, conclusive and binding on the Company, the Rights Agent, the
48
<PAGE>
holders of the Right Certificates and all other parties, and (ii) not subject
the Board or the Independent Directors to any liability to the holders of the
Right Certificates.
Section 30. Benefits of this Agreement. Nothing in this
-----------------------------
Agreement shall be construed to give to any Person other than the Company, the
Rights Agent and the registered holders of the Right Certificates (and, prior to
the Distribution Date, the Common Stock) any legal or equitable right, remedy or
claim under this Agreement; but this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the registered holders of
the Right Certificates (and, prior to the Distribution Date, registered holders
of the Common Stock).
Section 31. Severability. If any term, provision, covenant or
------------
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated;
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 Board of
Directors of the Company determines in its good faith judgment that severing the
invalid language from this Agreement would adversely affect the purpose or
effect of this Agreement, the right of redemption set forth in Section 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 Board of Directors.
Section 32. Governing Law. This Agreement and each Right
--------------
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of Delaware and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts to
be made and performed entirely within such State except that the rights, duties
and obligations of the Rights Agent under this Agreement shall be governed by
the laws of the State of New York.
Section 33. Counterparts. This Agreement may be executed in
------------
any number of counterparts and each of such counterparts shall for all
purposes be deemed to be an original, and all such counterparts shall
together constitute but one and the same instrument.
49
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Section 34. Descriptive Headings. Descriptive headings of
--------------------
the several Sections of this Agreement are inserted for convenience only and
shall not control or affect the meaning or construction of any of the provisions
hereof.
50
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
[SEAL]
LEXMARK INTERNATIONAL GROUP, INC.
Attest
By: /s/ Vincent J. Cole By: Gary E. Morin
---------------------------------- ----------------------------------
Name: Vincent J. Cole Name: Gary E. Morin
Title: Vice President, General Title: Vice President and Chief
Counsel and Secretary Financial Officer
[SEAL]
Attest: CHASEMELLON SHAREHOLDER
SERVICES, L.L.C.,
as Rights Agent
By: By:
---------------------------------- ----------------------------------
Name: Name:
Title: Title:
51
<PAGE>
EXHIBIT A
Series A Junior Participating Preferred Stock
(Liquidation Preference $1.00 Per Share)
AMENDED CERTIFICATE OF DESIGNATION
LEXMARK INTERNATIONAL GROUP, INC.
----------------------------
Certificate of Designation of Board of Directors Classifying
and Designating a Series of Preferred Stock as
Series A Junior Participating Preferred Stock
and Fixing Distribution and
Other Preferences and Rights of Such Series
----------------------------
Dated as of February 11, 1999
<PAGE>
LEXMARK INTERNATIONAL GROUP, INC.
----------
Amended Certificate of Designation of
Board of Directors Classifying and Designating a
Series of Preferred Stock as
Series A Junior Participating Preferred Stock
and Fixing Distribution and
Other Preferences and Rights of Such Series
----------
Lexmark International Group, Inc., a Delaware corporation,
having its principal office in the State of Kentucky in the City of Lexington
(the "Company"), hereby certifies that:
Pursuant to authority conferred upon the Board of Directors by
the Third Restated Certificate of Incorporation ("Charter") and Bylaws of the
Company, the Board of Directors (A) pursuant to resolutions adopted on February
18, 1998 (i) authorized the creation and issuance of up to 1,000,000 shares of
Series A Junior Participating Preferred Stock which stock was previously
authorized but not issued and (ii) determined the voting powers, designations,
preferences and relative, participating, optional or other special rights,
qualifications, limitations or restrictions, and terms and conditions of
redemption of the shares of such series and the Dividend Rate payable on such
series and (B) pursuant to resolutions adopted on February 11, 1999,
authorized certain modifications to such voting powers, designations,
preferences and relative, participating, optional or other special
rights, qualifications, limitations or restrictions, and terms and conditions of
redemption, number of shares and Dividend Rate. Such voting powers,
designations, preferences and relative, participating, optional or other special
rights, qualifications, limitations or restrictions, and terms and conditions of
redemption, number of shares and Dividend Rate, as modified, are as follows:
Section 1. Number of Shares and Designation. This class of
---------------------------------
Preferred Stock, which is authorized but not issued as of the date hereof,
shall be designated the Series A Junior Participating Preferred
Stock (the "Series A Preferred Shares") and the number of shares which shall
constitute such series shall be 1,000,000 shares, par value $0.01 per share.
Such number of shares may be increased or decreased by resolution of the Board
A-2
<PAGE>
of Directors; provided, that no decrease shall reduce the number of Series A
Preferred Shares to a number less than the number of shares then outstanding
plus the number of shares reserved for issuance upon the exercise of outstanding
options, rights or warrants or upon the conversion of any outstanding securities
issued by the Company convertible into Series A Preferred Shares.
Section 2. Dividend Rights. (1) Subject to the rights of
----------------
holders of any shares of any series of Preferred Stock (or any similar stock)
ranking prior and superior to the Series A Preferred Shares with respect to
dividends, the holders of Series A Preferred Shares shall be entitled prior to
the payment of any dividends on shares ranking junior to the Series A Preferred
Shares to receive, when, as and if declared by the Board of Directors out of
funds legally available for the purpose, quarterly dividends payable in cash on
the first day of February, May, August and November in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"), commencing on
the first Quarterly Dividend Payment Date after the first issuance of a share or
fraction of a share of Series A Preferred Shares, in an amount per share
(rounded to the nearest cent) equal to the greater of (a) $1.00 or (b) subject
to the provision for adjustment hereinafter set forth, 1,000 times the aggregate
per share amount of all cash dividends, and 1,000 times the aggregate per share
amount (payable in kind) of all non-cash dividends or other distributions (other
than a dividend payable in shares of common stock, par value $0.01 per share, of
the Company (the "Common Stock") or a subdivision of the outstanding shares of
Common Stock (by reclassification or otherwise)) declared on the Common Stock
since the immediately preceding Quarterly Dividend Payment Date, or, with
respect to the first Quarterly Dividend Payment Date, since the first issuance
of any share or fraction of a share of Series A Preferred Shares. In the event
the Company shall at any time (i) declare or pay any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the outstanding Common Stock,
or (iii) combine the outstanding Common Stock into a smaller number of shares,
then in each such case the amount to which holders of Series A Preferred Shares
were entitled immediately prior to such event under clause (b) of the preceding
sentence shall be adjusted by multiplying such amount by a fraction, the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
(2) The Company shall declare a dividend or distribution on
the Series A Preferred Shares as provided in subparagraph (1) above immediately
after it declares a dividend or distribution on the Common Stock (other than a
A-3
<PAGE>
dividend payable in shares of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on the Common Stock during the
period between any Quarterly Dividend Payment Date and the next subsequent
Quarterly Dividend Payment Date, a dividend of $1.00 per share on the Series A
Preferred Shares shall nevertheless be payable on such subsequent Quarterly
Dividend Payment Date.
(3) Dividends shall begin to accrue and be cumulative on
outstanding Series A Preferred Shares from the Quarterly Dividend Payment Date
next preceding the date of issue of such Series A Preferred Shares, unless the
date of issue of such shares is prior to the record date for the first Quarterly
Dividend Payment Date, in which case dividends on such shares shall begin to
accrue from the date of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record date for the
determination of holders of Series A Preferred Shares entitled to receive a
quarterly dividend and before such Quarterly Dividend Payment Date, in either of
which events such dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear
interest. Dividends paid on the Series A Preferred Shares in an amount less than
the total amount of such dividends at the time accrued and payable on such
shares shall be allocated pro rata on a share-by-share basis among all such
shares at the time outstanding. The Board of Directors may fix a record date for
the determination of holders of Series A Preferred Shares entitled to receive
payment of a dividend or distribution declared thereon, which record date shall
be no more than 30 days prior to the date fixed for the payment thereof.
Section 3. Liquidation. (1) Upon any liquidation, dissolution
-----------
or winding up of the Company, no distribution shall be made to the holders of
shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Shares unless, prior
thereto, the holders of shares of Series A Preferred Shares shall have received
$1.00 per share (the "Series A Liquidation Preference"), plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not declared,
to the date of such payment. Following the payment of the full amount of the
Series A Liquidation Preference, no additional distributions shall be made to
the holders of shares of Series A Preferred Shares unless, prior thereto, the
holders of shares of Common Stock shall have received an amount per share (the
"Common Adjustment") equal to the quotient obtained by dividing (i) the Series A
Liquidation Preference by (ii) 1,000 (as appropriately adjusted as set forth in
subparagraph (3) below to reflect such events as stocks splits, stock dividends
<PAGE>
and recapitalizations with respect to the Common Stock) (such number in clause
(ii), the "Adjustment Number"). Following the payment of the full amount of the
Series A Liquidation Preference and the Common Adjustment in respect of all
outstanding Series A Preferred Shares and shares of Common Stock, respectively,
holders of Series A Preferred Shares and holders of shares of Common Stock shall
receive their ratable and proportionate share of the remaining assets to be
distributed in the ratio of the Adjustment Number to 1 with respect to the
Series A Preferred Shares and Common Stock, on a per share basis, respectively.
(2) In the event, however, that there are not sufficient
assets available to permit payment in full of the Series A Liquidation
Preference and the liquidation preferences of all other series of Preferred
Stock, if any, which rank on a parity with the Series A Preferred Shares, then
such remaining assets shall be distributed ratably to the holders of such parity
shares in proportion to their respective liquidation preferences. In the event,
however, that there are not sufficient assets available to permit payment in
full of the Common Adjustment, then such remaining assets shall be distributed
ratably to the holders of Common Stock.
(3) In the event the Company shall at any time (i) declare any
dividend on Common Stock payable in shares of Common Stock, (ii) subdivide the
outstanding Common Stock, or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the Adjustment Number in effect
immediately prior to such event shall be adjusted by multiplying such Adjustment
Number by a fraction, the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately prior to
such event.
Section 4. No Redemption. The Series A Preferred Shares
-------------
shall not be redeemable.
Section 5. Voting Rights. The holders of Series A Preferred
-------------
Shares shall have the
following voting rights:
(1) Subject to the provision for adjustment hereinafter set
forth, each Series A Preferred Share shall entitle the holder thereof to 1,000
votes on all matters voted on at a meeting of the stockholders of the Company.
In the event the Company shall at any time (i) declare or pay any dividend on
Common Stock payable in shares of Common Stock, or (ii) subdivide the
outstanding Common Stock, or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the number of votes per share
to which holders of Series A Preferred Shares were entitled immediately prior to
A-5
<PAGE>
such event shall be adjusted by multiplying such number by a fraction, the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
(2) Except as otherwise provided herein or by law, the holders
of Series A Preferred Shares and the holders of shares of Class A Common Stock
and any other capital stock of the Company having general voting rights shall
vote together as one voting group on all matters submitted to a vote of
stockholders of the Company.
(3) Except as set forth herein or as otherwise provided by
law, holders of Series A Preferred Shares shall have no special voting rights
and their consent shall not be required (except to the extent they are entitled
to vote with holders of Class A Common Stock as set forth herein) for taking any
corporate action.
Section 6. Certain Restrictions.
--------------------
(1) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in Section 2
are in arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on Series A Preferred Shares outstanding
shall have been paid in full, the Company shall not:
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire for
consideration any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the Series
A Preferred Shares;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Shares, except dividends paid ratably on the Series
A Preferred Shares and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts to which the
holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Shares, provided that the Company may at any time
redeem, purchase or otherwise acquire shares of any such parity stock
A-6
<PAGE>
in exchange for shares of any stock of the Company ranking junior
(either as to dividends or upon dissolution, liquidation or winding up)
to the Series A Preferred Shares; or
(iv) purchase or otherwise acquire for consideration
any shares of Series A Preferred Shares or any shares of stock ranking
on a parity with the Series A Preferred Shares, except in accordance
with a purchase offer made in writing or by publication (as determined
by the Board of Directors) to all holders of such shares upon such
terms as the Board of Directors, after consideration of the respective
annual dividend rates and other relative rights and preferences of the
respective series and classes, shall determine in good faith will
result in fair and equitable treatment among the respective series or
classes.
(2) The Company shall not permit any subsidiary of the Company
to purchase or otherwise acquire for consideration any shares of stock of the
Company unless the Company could, under subparagraph (1) of this Section 6,
purchase or otherwise acquire such shares at such time and in such manner.
Section 7. Reacquired Shares. Any Series A Preferred Shares
------------------
purchased or otherwise acquired by the Company in any manner whatsoever shall be
retired and cancelled promptly after the acquisition thereof. All such shares
shall upon their cancellation become authorized but unissued shares of Preferred
Stock and may be reissued as part of a new series of Preferred Stock to be
created by resolution or resolutions of the Board of Directors, subject to the
conditions and restrictions on issuance set forth herein or in the Charter.
Section 8. Merger, Consolidation, etc. In case the Company
----------------------------
shall enter into any merger, consolidation, combination or other transaction in
which the shares of Common Stock are exchanged for or changed into other stock
or securities, cash and/or any other property, then in any such case each Series
A Preferred Share shall at the same time be similarly exchanged or changed into
an amount per share (subject to the provision for adjustment hereinafter set
forth) equal to 1,000 times the aggregate amount of stock, securities, cash
and/or any other property (payable in kind), as the case may be, into which or
for which each share of Common Stock is changed or exchanged. In the event the
Company shall at any time (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the amount set forth in the preceding sentence with respect to
the exchange or change of Series A Preferred Shares shall be adjusted by
A-7
<PAGE>
multiplying such amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 9. Ranking. The Series A Preferred Shares shall rank,
-------
with respect to the payment of dividends and distribution of assets, junior to
all series of any other class of the Company's Preferred Stock unless the terms
of any such series shall provide otherwise.
Section 10. Amendment. The Charter, including this Amended
---------
Certificate of Designation establishing the rights and preferences of
the Series A Preferred Shares, shall not be amended in any manner which would
materially alter or change the powers, preferences or special rights of the
Series A Preferred Shares so as to affect them adversely without the affirmative
vote of the holders of a majority of the outstanding shares of Series A
Preferred Shares, voting separately as one voting group.
Section 11. Fractional Shares. Series A Preferred Shares may
------------------
be issued in fractions of a share which shall entitle the holder, in proportion
to such holder's fractional shares, to exercise voting rights, receive
dividends, participate in distributions and to have the benefit of all other
rights of holders of Series A Preferred Shares.
A-8
<PAGE>
IN WITNESS WHEREOF, the Company has caused this Amended
Certificate of Designation to be signed in its name and on its behalf
and attested to by the undersigned on this day of February 11, 1999 and the
undersigned acknowledges under the penalties of perjury that this Amended
Certificate of Designation is the corporate act of said Company and
that to the best of his knowledge, information and belief, the matters and
facts set forth herein are true in all material respects.
LEXMARK INTERNATIONAL GROUP, INC.
By:
---------------------------
Name: Gary E. Morin
Title: Vice President and Chief
Financial Officer
Attest:
- ------------------------------
Name: Vincent J. Cole
Title: Vice President, General Counsel
and Secretary
A-9
<PAGE>
EXHIBIT B
[FORM OF RIGHT CERTIFICATE]
Certificate No. R- Rights
-------
NOT EXERCISABLE AFTER JANUARY 31, 2009 OR EARLIER IF NOTICE OF
REDEMPTION IS GIVEN. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE
OPTION OF THE COMPANY, AT $.001 PER RIGHT ON THE TERMS SET FORTH IN THE
AMENDED AND RESTATED RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES,
RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS DEFINED IN THE
AMENDED AND RESTATED RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER MAY
BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS AMENDED AND
RESTATED RIGHT CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON
WHO WAS OR BECAME AN ACQUIRING PERSON OR AN ASSOCIATE OR AFFILIATE OF
AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE AMENDED AND
RESTATED RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHT CERTIFICATE AND THE
RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES
SPECIFIED IN SECTION 7(e) OF THE AMENDED AND RESTATED RIGHTS
AGREEMENT.]*
LEXMARK INTERNATIONAL GROUP, INC.
Right Certificate
This certifies that , or registered assigns, is the registered
owner of the number of Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of the Amended and
Restated Rights Agreement dated as of , 1999 (the "Amended and Restated Rights
Agreement") between Lexmark International Group, Inc., a Delaware corporation
(the "Company"), and ChaseMellon Shareholder Services, L.L.C., a New Jersey
limited liability company (the "Rights Agent"), to purchase from the Company at
any time after the Distribution Date (as such term is defined in the Amended and
Restated Rights Agreement) and prior to 5:00 P.M. (New York City time) on
January 31, 2009 at the designated office of the Rights Agent, or its successors
- ----------------------
* The portion of the legend in brackets shall be inserted only if applicable.
B-1
<PAGE>
as Rights Agent, in New York, New York, one one-thousandth of a fully paid
non-assessable share of the Series A Junior Participating Preferred Stock, par
value $0.01 per share (the "Preferred Stock"), of the Company, at a purchase
price of $200 per one one-thousandth of a share (the "Purchase Price"), upon
presentation and surrender of this Right Certificate with the Form of Election
to Purchase and related certificate duly executed, along with a signature
guarantee and such other and further documentation as the Rights Agent may
reasonably request. The number of Rights evidenced by this Right Certificate
(and the number of shares which may be purchased upon exercise thereof) set
forth above, and the Purchase Price per share set forth above, are the number
and Purchase Price as of February 18, 1998, based on the Preferred Stock of the
Company as constituted at such date.
Upon the occurrence of a Triggering Event (as such term is
defined in the Amended and Restated Rights Agreement), if the Rights evidenced
by this Right Certificate are beneficially owned by (i) an Acquiring Person or
an Affiliate or Associate of any such Acquiring Person (as such terms are
defined in the Amended and Restated Rights Agreement), (ii) a transferee of any
such Acquiring Person, Associate or Affiliate, or (iii) under certain
circumstances specified in the Amended and Restated Rights Agreement, a
transferee of a person who after such transfer, became an Acquiring Person, or
an Affiliate or Associate of an Acquiring Person, such Rights shall become null
and void and no holder hereof shall have any right with respect to such Rights
from and after the occurrence of such Triggering Event.
As provided in the Amended and Restated Rights Agreement, the
Purchase Price and the number and kind of shares of Preferred Stock (or, in
certain circumstances, common stock and/or other securities) which may be
purchased upon the exercise of the Rights evidenced by this Right Certificate
are subject to modification and adjustment upon the happening of certain events,
including Triggering Events.
This Right Certificate is subject to all of the terms,
provisions and conditions of the Amended and Restated Rights Agreement, which
terms, provisions and conditions are hereby incorporated herein by reference and
made a part hereof and to which Amended and Restated Rights Agreement reference
is hereby made for a full description of the rights, limitations of rights,
obligations, duties and immunities hereunder of the Rights Agent, the Company
and the holders of the Right Certificates. Copies of the Amended and Restated
Rights Agreement are on file at the above-mentioned office of the Rights Agent,
and at the executive offices of the Company.
B-2
<PAGE>
This Right Certificate, with or without other Right
Certificates, upon surrender at the designated office of the Rights Agent, along
with a signature guarantee and such other and further documentation as the
Rights Agent may reasonably request, may be exchanged for another Right
Certificate or Right Certificates of like tenor and date evidencing Rights
entitling the holder to purchase a like aggregate number of one one-thousandth
of a share of Preferred Stock 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, along with a signature guarantee and
such other and further documentation as the Rights Agent may reasonably request,
another Right Certificate or Right Certificates for the number of whole Rights
not exercised.
Subject to the provisions of the Amended and Restated Rights
Agreement, the Rights evidenced by this Certificate may be (i) redeemed by the
Company at a redemption price of $.001 per Right or (ii) exchanged by the
Company in whole or in part for shares of common stock or Preferred Stock.
No fractional shares of Preferred Stock will be issued upon
the exercise of any Right or Rights evidenced hereby (other than fractions which
are integral multiples of one one-thousandth of a share of Preferred Stock), but
in lieu thereof a cash payment will be made, as provided in the Rights
Agreement.
No holder of this Right Certificate shall be entitled to vote
or receive dividends or be deemed for any purpose the holder of the Preferred
Stock or of any other securities of the Company which may at any time be
issuable on the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any
of the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give or withhold consent to any corporate action, or, to
receive notice of meetings or other actions affecting stockholders (except as
provided in the Rights Agreement), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced by this Right
Certificate shall have been exercised as provided in the Amended and Restated
Rights Agreement.
This Right Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights Agent.
B-3
<PAGE>
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal. Dated as of April 3, 1998.
[SEAL]
ATTEST: LEXMARK INTERNATIONAL GROUP, INC.
By: By:
----------------------- -----------------------
Name: Name:
Title: Title:
Countersigned:
CHASEMELLON SHAREHOLDER SERVICES,
L.L.C., as Rights Agent
By: -----------------------
Authorized Signature
Date:
B-4
<PAGE>
[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:
--------------------------------------------
(Signatures must be guaranteed by a commercial bank or trust company or by a
member of the New York Stock Exchange.)
B-5
<PAGE>
CERTIFICATE
-----------
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) this Right Certificate [ ] is [ ] is not being sold,
assigned and transferred by or on behalf of a Person who is or was an Acquiring
Person or an Affiliate or Associate of any such Acquiring Person (as such terms
are defined pursuant to the Amended and Restated Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it [ ] did [ ] did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or subsequently became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person.
Dated: ,
------------ -------
----------------------------
Signature
Signature Guaranteed:
--------------------------------------------
(Signatures must be guaranteed by a commercial bank or trust company or by a
member of the New York Stock Exchange.)
NOTICE
------
The signature to the foregoing Assignment and Certificate must
correspond to the name as written upon the face of this Right Certificate in
every particular, without alteration or enlargement or any change whatsoever.
B-6
<PAGE>
FORM OF ELECTION TO PURCHASE
----------------------------
(To be executed if holder desires to exercise
Rights evidenced by the Right Certificate.)
Lexmark International Group, Inc.:
The undersigned hereby irrevocably elects to exercise
Rights represented by this Right Certificate to purchase the
- ---------------
shares of the Preferred Stock issuable upon the exercise of such Rights (or such
other securities of the Company or of any other Person which may be issuable
upon the exercise of the Rights) and requests that certificates for such shares
be issued in the name of:
Please insert social security or
other taxpayer identifying number
- -------------------------------------------------------------------------------
(Please print name and address)
- -------------------------------------------------------------------------------
If such number of Rights shall not be all the Rights evidenced
by this Right Certificate, a new Right Certificate for the balance remaining of
such Rights shall be registered in the name of and delivered to:
Please insert social security or
other taxpayer identifying number
- -------------------------------------------------------------------------------
(Please print name and address)
- -------------------------------------------------------------------------------
Dated:
-------------, ------
----------------------------------
Signature
Signature Guaranteed:
-----------------------------------------------
(Signatures must be guaranteed by a commercial bank or trust company or by a
member of the New York Stock Exchange.)
B-7
<PAGE>
CERTIFICATE
-----------
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Right Certificate [ ] are [ ]
are not being exercised by or on behalf of a Person who is or was an Acquiring
Person or an Affiliate or Associate of any such Acquiring Person (as such terms
are defined pursuant to the Amended and Restated Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it [ ] did [ ] did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or subsequently became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person.
Dated:
-------------, -------
------------------------------------
Signature
Signature Guaranteed:
---------------------------------------------------
(Signatures must be guaranteed by a commercial bank or trust company or by a
member of the New York Stock Exchange.)
NOTICE
------
The signature to the foregoing Election to Purchase and
Certificate must correspond to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement or any change
whatsoever.
B-8
<PAGE>
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE PREFERRED STOCK
The Board of Directors of Lexmark International Group, Inc.
(the "Company") has declared a dividend distribution of one Right for each
outstanding share of Class A Common Stock, par value $0.01 per share, and Class
B Common Stock, par value $0.01 per share (collectively, the "Common Stock"), of
the Company. The distribution is payable to holders of record on April 3, 1998
(the "Record Date"). Each Right entitles the registered holder to purchase from
the Company one one-thousandth of a share of Series A Junior Participating
Preferred Stock (the "Preferred Stock"), at a price of $200 per one
one-thousandth of a share (the "Purchase Price"), subject to adjustment. The
description and terms of the Rights are set forth in an Amended and Restated
Rights Agreement (the "Amended and Restated Rights Agreement") between the
Company and ChaseMellon Shareholder Services, L.L.C., as Rights Agent (the
"Rights Agent").
Distribution Date; Transfer of Rights
- -------------------------------------
Until the earlier to occur of (i) ten calendar days following
the date (the "Shares Acquisition Date") of public announcement that a person or
group of affiliated or associated persons (an "Acquiring Person") acquired, or
obtained the right to acquire, beneficial ownership of Class A Common Stock or
other voting securities ("Voting Stock") that have 15% or more of the voting
power of the outstanding shares of Voting Stock or (ii) ten calendar days (or
such later date as may be determined by action of the Board of Directors prior
to the time any person or group of affiliated persons becomes an Acquiring
Person) following the commencement or announcement of an intention to make a
tender offer or exchange offer the consummation of which would result in such
person or group acquiring, or obtaining the right to acquire, beneficial
ownership of Voting Stock having 15% or more of the voting power of the
outstanding shares of Voting Stock (the earlier of such dates being called the
"Distribution Date"), the Rights will be evidenced, with respect to any of the
Company's Common Stock certificates outstanding as of the Record Date, by such
Common Stock certificates. The Amended and Restated Rights Agreement provides
C-1
<PAGE>
that, until the Distribution Date, the Rights will be transferred with and only
with the Company's Common Stock. Until the Distribution Date (or earlier
redemption or expiration of the Rights), new Common Stock certificates issued
after the Record Date upon transfer or new issuance of the Company's Common
Stock will contain a notation incorporating the Amended and Restated Rights
Agreement by reference. Until the Distribution Date (or earlier redemption or
expiration of the Rights), the surrender for transfer of any of the Company's
Common Stock certificates outstanding as of the Record Date will also constitute
the transfer of the Rights associated with the Common Stock represented by such
certificate. As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be mailed to
holders of record of the Company's Common Stock as of the close of business on
the Distribution Date and such separate Right Certificates alone will evidence
the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire at the close of business on January 31, 2009, unless
earlier redeemed or exchanged by the Company as described below.
Exercise of Rights for Common Stock of the Company
- --------------------------------------------------
In the event that a Person becomes an Acquiring Person, each
holder of a Right will thereafter have the right to receive, upon exercise,
Class A Common Stock (or, in certain circumstances, cash, property or other
securities of the Company) having a value equal to two times the Purchase Price
of the Right. Notwithstanding any of the foregoing, following the occurrence of
the event set forth in this paragraph, all Rights that are, or (under certain
circumstances specified in the Amended and Restated Rights Agreement) were,
beneficially owned by any Acquiring Person will be null and void.
Exercise of Rights for Shares of the Acquiring Company
- ------------------------------------------------------
In the event that, at any time following the Shares
Acquisition Date, (i) the Company is acquired in a merger or other business
combination transaction, or (ii) 50% or more of the Company's assets or earning
power is sold or transferred, each holder of a Right (except Rights which
previously have been voided as set forth above) shall thereafter have the right
to receive, upon exercise, common stock of the acquiring company having a value
equal to two times the Purchase Price of the Right.
Adjustments to Purchase Price
- -----------------------------
The Purchase Price payable, and the number of shares of
Preferred Stock (or Class A Common Stock or other securities, as the case may
be) issuable, upon exercise of the Rights are subject to adjustment from time to
time to prevent dilution (i) in the event of a stock dividend on, or a
C-2
<PAGE>
subdivision, combination or reclassification of the Preferred Stock, (ii) upon
the grant to holders of the Preferred Stock of certain rights or warrants to
subscribe for shares of the Preferred Stock or convertible securities at less
than the current market price of the Preferred Stock or (iii) upon the
distribution to holders of the Preferred Stock of evidences of indebtedness or
assets (excluding regular periodic cash dividends out of earnings or retained
earnings or dividends payable in the Preferred Stock) or of subscription rights
or warrants (other than those referred to above).
With certain exceptions, no adjustment in the Purchase Price
will be required until the earlier of (i) three years from the date of the event
giving rise to such adjustment and (ii) the time at which cumulative adjustments
require an adjustment of at least 1% in such Purchase Price. No fractional
shares will be issued (other than fractional shares which are integral multiples
of one one-thousandth of a share of Preferred Stock) and, in lieu thereof, an
adjustment in cash will be made based on the market price of the Preferred Stock
on the last trading date prior to the date of exercise.
Redemption and Exchange of Rights
- ---------------------------------
At any time after the occurrence of the event set forth under
the heading "Exercise of Rights for Common Stock of the Company" above, the
Board of Directors (with the concurrence of a majority of the Independent
Directors (as defined below)) may exchange the Rights (other than Rights owned
by the Acquiring Person which shall have become void), in whole or in part, at
an exchange ratio of one share of Class A Common Stock (or a fraction of a share
of Preferred Stock having the same market value) per Right (subject to
adjustment).
At any time prior to 5:00 P.M. New York City time on the tenth
calendar day following the Shares Acquisition Date, the Company may redeem the
Rights in whole, but not in part, at a price of $.001 per Right (the "Redemption
Price"). Under certain circumstances set forth in the Amended and Restated
Rights Agreement, the decision to redeem shall require that there be Independent
Directors in office and that a majority of the Independent Directors concur in
such decision. Immediately upon the action of the Board of Directors of the
Company electing to redeem the Rights with, if required, the concurrence of the
Independent Directors, the Company shall make announcement thereof, and upon
such action, the right to exercise the Rights will terminate and the only right
of the holders of Rights will be to receive the Redemption Price.
Until a Right is exercised or exchanged, the holder thereof,
as such, will have no rights as a stockholder of the Company, including, without
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limitation, the right to vote or to receive dividends.
Terms of the Preferred Stock
- ----------------------------
The Preferred Stock will rank junior to all other series of
the Company's preferred stock with respect to payment of dividends and as to
distributions of assets in liquidation. Each share of Preferred Stock will have
a quarterly dividend rate per share equal to the greater of $1.00 or 1,000 times
the per share amount of any dividend (other than a dividend payable in shares of
Common Stock or a subdivision of the Common Stock) declared from time to time on
the Common Stock, subject to certain adjustments. The Preferred Stock will not
be redeemable. In the event of liquidation, the holders of the Preferred Stock
will be entitled to receive a preferred liquidation payment per share of $1.00
(plus accrued and unpaid dividends) or, if greater, an amount equal to 1,000
times the payment to be made per share of Common Stock, subject to certain
adjustments. Generally, each share of Preferred Stock will vote together with
the Class A Common Stock and any other series of cumulative preferred stock
entitled to vote in such manner and will be entitled to 1,000 votes, subject to
certain adjustments. In the event of any merger, consolidation, combination or
other transaction in which shares of Common Stock are exchanged for or changed
into other stock or securities, cash and/or other property, each share of
Preferred Stock will be entitled to receive 1,000 times the aggregate amount of
stock, securities, cash and/or other property, into which or for which each
share of Common Stock is changed or exchanged, subject to certain adjustments.
The foregoing dividend, voting and liquidation rights of the Preferred Stock are
protected against dilution in the event that additional shares of Common Stock
are issued pursuant to a stock split or stock dividend or distribution. Because
of the nature of the Preferred Stock's dividend, voting, liquidation and other
rights, the value of the one one-thousandth of a share of Preferred Stock
purchasable with each Right is intended to approximate the value of one share of
Class A Common Stock.
Amendments to Terms of the Rights
- ---------------------------------
Any of the provisions of the Amended and Restated Rights
Agreement may be amended by the Board of Directors of the Company prior to the
Distribution Date. After the Distribution Date, the provisions of the Amended
and Restated Rights Agreement may be amended by the Board (in certain
circumstances, with the concurrence of the Independent Directors) in order to
cure any ambiguity, defect or inconsistency, or to make changes which do not
adversely affect the interests of holders of Rights (excluding the interests of
any Acquiring Person); provided, however, that no supplement or amendment may be
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made after the Distribution Date which changes those provisions relating to the
principal economic terms of the Rights.
The term "Independent Directors" means, with respect to any
transaction or series of transactions, a member of the Board of Directors of the
Company other than a director who has a relationship that would interfere with
the exercise of independent judgment in carrying out the responsibilities of a
director or a financial interest in or with respect to such transaction or
series of transactions.
A copy of the Amended and Restated Rights Agreement has been
filed with the Securities and Exchange Commission as an Exhibit to Amendment No.
1 to the Registration Statement on Form 8-A dated February 27, 1998. A copy of
the Amended and Restated Rights Agreement is available free of charge from the
Company. This summary description of the Rights does not purport to be complete
and is qualified in its entirety by reference to the Amended and Restated Rights
Agreement, which is hereby incorporated herein by reference.
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