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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
Imatec, Ltd.
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(Exact name of registrant as specified in its charter)
Delaware 11-3289398
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
150 East 58th Street, New York, New York 10155
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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 of which
to be so registered each class is to be registered
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None
Securities to be registered pursuant to Section 12 (g) of the Act:
Title of each class Name of each exchange of which
to be so registered each class is to be registered
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Share Purchase Rights OTC Bulletin Board
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RIGHTS AGREEMENT (the "Rights Agreement"), effective as of August 17,
1998, between IMATEC, LTD., a Delaware corporation (the "Company") with
executive offices at 150 East 58th Street, New York, New York, 10155, and
CONTINENTAL STOCK TRANSFER & TRUST COMPANY, (the "Rights Agent"), a New York
corporation with executive offices located at 2 Broadway, New York, New York,
10004.
W I T N E S S E T H:
WHEREAS, on August 17, 1998, the Board of Directors of the Company
authorized and declared a dividend of one common share purchase right (as
hereinafter defined) for each share of common stock (as hereinafter defined)
outstanding at the close of business on August 28, 1998, (the "Record Date"),
each right representing the right to purchase one share of Common Stock upon
the terms, and subject to the conditions, herein set forth. At that time, the
Board of Directors further authorized and directed the issuance of one right
with respect to each share of Common Stock that became outstanding between the
Record Date and the Distribution Date (as hereinafter defined);
Accordingly, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions
Purposes of this Rights Agreement, the following terms have the
meanings set forth below:
(a) "Acquiring Person" shall mean any Person who or which, together
with all Affiliates and Associates of such Person, shall become, at any time
after the date of this Rights Agreement (whether or not such status continues
for any period), the Beneficial Owner of shares of Common Stock representing
20% or more of the Common Stock then outstanding, other than as a result of a
Permitted Offer. Notwithstanding the foregoing, (A) the term "Acquiring
Person" shall not include (i) the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or any Subsidiary of the Company, or any
member of the Board of Directors of the Company on the date of effectiveness
of this Rights Agreement, or (ii) any Person, which together with all
Affiliates and Associates of such Person, shall become the Beneficial Owner of
20% or more of the then outstanding Common Stock as a result of the
acquisition of shares of Common Stock directly from the Company (provided,
however, that if, after such acquisition, such Person, or an Affiliate or
Associate of such Person, becomes the Beneficial Owner of any additional
shares of Common Stock in an acquisition not made directly from the Company,
then such Person shall be deemed an Acquiring Person), and (B) no Person shall
be deemed to be an "Acquiring Person" either (X) as a result of the
acquisition of shares of Common Stock by the Company which, by reducing the
number of shares of Common Stock outstanding, increases the proportional
number of shares beneficially owned by such Person together with all
Affiliates and Associates of such Person; except that if (i) a Person would
become an Acquiring Person (but for the operation of this subclause (X)) as a
result of the acquisition of shares of Common Stock by the Company, and (ii)
after such share acquisition by the Company, such Person, or an Affiliate or
Associate of such Person, becomes the Beneficial Owner of any additional
shares of Common Stock, then such Person shall be deemed an Acquiring Person,
or (Y) if (i) such Person, or an Affiliate or Associate of such Person
inadvertently becomes the Beneficial Owner of 20% or more of the outstanding
Common Stock, (ii) within eight days thereafter such Person notifies the Board
of Directors that such Person
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did so inadvertently, and (iii) within two days after such notification, such
Person is the Beneficial Owner of less than 20% of the outstanding Common
Stock.
(b) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations
under the Exchange Act.
(c) A Person shall be deemed the "Beneficial Owner" of, and shall be
deemed to have acquired "beneficial ownership" of, or to "beneficially own",
any securities:
(i) which such Person or any of such Person's Affiliates or
Associates beneficially owns, directly or indirectly, as
determined pursuant to Rule 13d-3 of the General Rules and
Regulations under the Exchange Act as of the date hereof;
(ii) which such Person or any of such Person's Affiliates or
Associates has (A) the right to acquire (whether such right
is exercisable immediately or only after the passage of
time) pursuant to any agreement, arrangement, or
understanding (other than customary agreements with and
between underwriters and selling group members with respect
to a bona fide public offering of securities), or upon the
exercise of conversion rights, exchange rights, rights
(other than the Rights), warrants or options, or otherwise;
provided, however, that a Person shall not be deemed the
Beneficial Owner of, or to beneficially own, securities
tendered pursuant to a tender or exchange offer made by, or
on behalf of, such Person or any of such Person's Affiliates
or Associates until such tendered securities are accepted
for purchase or exchange; or (B) the right to vote pursuant
to any agreement, arrangement, or understanding; provided,
however, that a Person shall not be deemed the Beneficial
Owner of, or to beneficially own, any security if the
agreement, arrangement, or understanding to vote such
security (1) arises solely from a revocable proxy or consent
given to such Person in response to a public proxy or
consent solicitation made pursuant to, and in accordance
with, the applicable rules and regulations promulgated under
the Exchange Act and (2) is not also then reportable on
Schedule 13D under the Exchange Act (or any comparable or
successor report); or
(iii) which are beneficially owned, directly or indirectly, by any
other Person with which such Person or any of such Person's
Affiliates or Associates has any agreement, arrangement, or
understanding (other than customary agreements with and
between underwriters and selling group members with respect
to a bona fide public offering of securities) for the
acquiring, holding, voting (except to the extent
contemplated by the proviso to Section 1(c)(ii)(B)) or
disposing of any securities of the Company. Notwithstanding
anything in this definition of "Beneficial Owner" to the
contrary, the phrase "then outstanding," when used with
reference to a Person's beneficial ownership of securities
of the Company, shall mean the number of such securities
then issued and outstanding together with the number of such
securities not then actually issued and outstanding which
such Person would be deemed to own beneficially hereunder.
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(d) "Business Day" shall mean any day other than a Saturday, a
Sunday, or a day on which banking institutions in the City of New York, New
York, are authorized or obligated by law or executive order to close.
(e) "Close of Business" on any given date shall mean 5:00 P.M., New
York City local time on such date; provided, however, that if such date is not
a Business Day it shall mean 5:00 P.M., New York City local time on the next
succeeding Business Day.
(f) "Common Stock," when used with reference to the Company, shall
mean the Company's common stock, par value $0.001 per share, and any other
class or classes or series of common stock of the Company resulting from any
subdivision, combination, recapitalization, or reclassification of shares of
such common stock. "Common Stock" when used with reference to any Person other
than the Company shall mean the capital stock (or equity interest) with the
greatest voting power of such other Person or, if such other Person is a
Subsidiary of another Person, the Person or Persons which ultimately control
such first mentioned Person.
(g) "Company" shall have the meaning set forth in the introductory
paragraph to this Rights Agreement.
(h) "Distribution Date" shall have the meaning set forth in Section
3(a) hereof.
(i) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(j) "Exchange Ratio" shall have the meaning set forth in Section
24(a) hereof.
(k) "Final Expiration Date" shall have the meaning set forth in
Section 7(a) hereof.
(l) "Nasdaq" shall have the meaning set forth in Section 11(d)
hereof.
(m) "Permitted Offer" shall mean a tender or exchange offer which is
for all outstanding Common Stock at a price and on terms determined, prior to
the purchase of shares under such tender or exchange offer, by at least a
majority of the members of the Board of Directors who are not officers of the
Company and who are not (or would not be, if the offer were consummated)
Acquiring Persons or Affiliates, Associates, nominees, or representatives of
an Acquiring Person, to be adequate and otherwise in the best interest of the
Company and its stockholders (other than the Person or any Affiliate or
Associate thereof on whose basis the offer is being made). In determining
whether an offer is adequate or in the best interests of the Company and its
stockholders, the Board of Directors may take into account all factors that it
deems relevant including, without limitation, (1) the consideration being
offered in the proposal in relation to the Board's estimate of: (i) the
current value of the Company in a freely negotiated sale of either the Company
by merger, consolidation, or otherwise, or all or substantially all of the
Company's assets, (ii) the current value of the Company if orderly liquidated,
and (iii) the future value of the Company over a period of years as an
independent entity discounted to current value; (2) then existing political,
economic, and other factors bearing on security prices generally or the
current market value of the Company's securities in particular; (3) whether
the proposal might violate federal, state, or local laws; (4) the financial
conditions and earnings prospects of the person making the proposal,
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including the person's ability to service its debt and other existing or
likely financial obligations; and (5) the competence, experience, and
integrity of the person making the acquisition proposal.
(n) "Person" shall mean any individual, firm, partnership,
corporation, trust, association, joint venture, or other entity, and shall
include any successor (by merger or otherwise) of such entity.
(o) "Principal Party" shall have the meaning set forth in Section
13(b) hereof.
(p) "Purchase Price" shall have the meaning set forth in Section 7(a)
hereof.
(q) "Record Date" shall have the meaning set forth in the recitals to
this Rights Agreement.
(r) "Redemption Date" shall have the meaning set forth in Section
7(a) hereof.
(s) "Redemption Price" shall have the meaning set forth in Section 23
hereof.
(t) "Rights" shall mean the rights to purchase shares of Common Stock
authorized by the Board of Directors of the Company after the Record Date.
(u) "Rights Agent" shall have the meaning set forth in the
introductory paragraph to this Rights Agreement.
(v) "Rights Agreement" shall have the meaning set forth in the
introductory paragraph to this Rights Agreement.
(w) "Right Certificates" shall have the meaning set forth in the
Section 3(a) hereof.
(x) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(y) "Shares Acquisition Date" shall mean the first date of a public
announcement (which, for purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 13(d) under the Exchange Act)
by the Company or an Acquiring Person that an Acquiring Person has become
such; provided, that, if such Person is determined not to have become an
Acquiring Person pursuant to Section 1(a) hereof, then no Shares Acquisition
Date shall be deemed to have occurred.
(z) "Subsidiary" of any Person shall mean any corporation or other
entity of which a majority of the voting power of the voting equity securities
or equity interest is owned, directly or indirectly, by such Person.
(aa) "Summary of Rights" shall have the meaning set forth in Section
3(b) hereof.
(bb) "Trading Day" shall have the meaning set forth in Section 11(d)
hereof.
(cc) "Voting Securities" shall have the meaning set forth in Section
13(a) hereof.
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Section 2. Appointment of Rights Agent
The Company hereby appoints the Rights Agent to act as agent for the
Company and the holders of the Rights (who, in accordance with Section 3
hereof, shall, prior to the Distribution Date also be the holders of the
Common Stock) in accordance with the terms and conditions hereof, and the
Rights Agent hereby accepts such appointment. The Company may from time to
time appoint such co-Rights Agents as it may deem necessary or desirable.
Section 3. Issue of Right Certificates
(a) Until the earlier of (i) the close of business on the tenth day
after the Shares Acquisition Date, or (ii) the close of business on the tenth
business day (or such later date as may be determined by action of the Board
of Directors of the Company prior to such time as any Person becomes an
Acquiring Person) after the date that a tender or exchange offer by any Person
(other than the Company, any Subsidiary of the Company, any employee benefit
plan of the Company or of any Subsidiary of the Company or any entity holding
shares of Common Stock for or pursuant to the terms of any such plan, or any
member of the Board of Directors of the Company on the date of effectiveness
of this Rights Agreement) is first published or sent or given within the
meaning of Rule 14d-2 of the General Rules and Regulations under the Exchange
Act, if upon consummation thereof, such Person would be the Beneficial Owner
of 20% or more of the shares of Common Stock then outstanding; (the earlier of
such dates being herein referred to as the "Distribution Date"), (x) the
Rights will be evidenced (subject to the provisions of Section 3(b) hereof) by
the certificates for the shares of Common Stock registered in the names of the
holders thereof (which certificates shall also be deemed to be certificates
for Rights) and not by separate certificates, and (y) the Rights (and the
right to receive separate certificates ("Right Certificates")) will be
transferable only in connection with the transfer of the underlying shares of
Common Stock (including a transfer to the Company) as more fully set out
below. As soon as practicable after the Distribution Date, the Company will
prepare and execute, the Rights Agent will countersign, and the Company will
send or cause to be sent (and the Rights Agent will, if requested, send) by
first-class, postage-prepaid mail, to each record holder of shares 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, which
shall be in substantially the form of Exhibit A hereto, evidencing one Right
for each share of Common Stock so held. As of and after the Distribution Date,
the Rights will be evidenced solely by such Right Certificates.
(b) As promptly as reasonably practicable following the Record Date,
the Company will send a copy of a Summary of Rights to Purchase Shares of
Common Stock, in substantially the form of Exhibit B hereto (the "Summary of
Rights"), by first-class, postage-prepaid mail, to each record holder of
shares 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. Until the
Distribution Date (or the earlier of the Redemption Date or the Final
Expiration Date), the surrender for transfer of any certificate for shares of
Common Stock outstanding, with or without a copy of the Summary of Rights
attached thereto, shall also constitute the transfer of the Rights associated
with such shares of Common Stock.
(c) Certificates for shares of Common Stock which become outstanding
(including, without limitation, reacquired shares which are subsequently
disposed of by the Company) after the
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Record Date, but prior to the earliest of the Distribution Date, the
Redemption Date, or the Final Expiration Date, shall have impressed on,
printed on, written on, or otherwise affixed to them the a legend in
substantially the form set forth below:
"This certificate also evidences and entitles the holder hereof to
certain rights as set forth in the Rights Agreement, as it may from
time to time be supplemented or amended, between Imatec, Ltd. and
Continental Stock Transfer & Trust Company, the terms of which are
hereby incorporated herein by reference and a copy of which is on
file at the principal executive offices of Imatec, Ltd. Under certain
circumstances, as set forth in the Rights Agreement, such rights may
be redeemed or exchanged, may expire, or may be evidenced by separate
certificates and no longer be evidenced by this certificate. Imatec,
Ltd. will mail to the holder of this certificate a copy of the Rights
Agreement without charge within five days after receipt of a written
request therefor. Under certain circumstances, rights issued to, or
held by, Acquiring Persons or their Affiliates or Associates and any
subsequent holder of such rights may become null and void."
With respect to such certificates containing the foregoing legend,
until the Distribution Date, the Rights associated with the shares of Common
Stock represented by such certificates shall be evidenced by such certificates
alone, and the surrender for transfer of any such certificate shall also
constitute the transfer of the Rights associated therewith. In the event that
the Company purchases or acquires any shares of Common Stock prior to the
Distribution Date, any Rights associated with such shares of Common Stock
shall be deemed canceled and retired unless and until such shares of Common
Stock are subsequently issued by the Company so that the Company shall not be
entitled to exercise any Rights associated with the shares of Common Stock
which are no longer outstanding.
Section 4. Form of Right Certificates
(a) The Right Certificates (and the forms of election to purchase and
of assignment to be printed on the reverse thereof) shall be substantially the
same as provided for in Section 3(a) hereof 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 Rights 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.
Subject to the provisions of Section 22 hereof, the Right Certificates shall
entitle the holders thereof to purchase such number and kind of shares of
Common Stock as shall be set forth therein at the price per share set forth
therein, but the number and kind of such shares of Common Stock and the price
per share shall be subject to adjustment as provided herein.
(b) Any Right Certificate issued pursuant to Section 3(a) or Section
22 hereof that represents Rights which are null and void pursuant to Section
11(a)(ii) of this Rights Agreement and any Right Certificate issued pursuant
to Section 6, Section 11, or Section 22 hereof upon transfer, exchange,
replacement, or adjustment of any other Right Certificate referred to in this
sentence, shall contain (to the extent feasible) the following legend:
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"The Rights represented by this Right Certificate are or were
beneficially owned by a Person who was or became an Acquiring Person
or an Affiliate or Associate of an Acquiring Person (as such terms
are defined in the Rights Agreement). Accordingly, this Right
Certificate and the Rights represented hereby are null and void."
Notwithstanding the above provision, failure to place such legend on
any Right Certificate representing Rights which are otherwise null and void
pursuant to the terms of this Rights Agreement shall not affect the null and
void status of such Rights.
Section 5. Countersignature and Registration
The Right Certificates shall be executed on behalf of the Company by
its Chairman of the Board, its Chief Executive Officer, its President, any of
its Vice Presidents, or its Treasurer, either manually or by facsimile
signature, shall have affixed thereto the Company's seal or a facsimile
thereof, and shall be attested by the Secretary or an Assistant Secretary of
the Company, either manually or by facsimile signature. The Right Certificates
shall be manually countersigned by the Rights Agent and shall not be valid for
any purpose unless countersigned. In case any officer of the Company who shall
have signed any of the Right Certificates shall cease to be such officer of
the Company before countersignature by the Rights Agent and issuance and
delivery by the Company, such Right Certificates, nevertheless, may be
countersigned by the Rights Agent and issued and delivered by the Company with
the same force and effect as though the person who signed such Right
Certificates had not ceased to be such officer of the Company; and any Right
Certificate may be signed on behalf of the Company by any person who, at the
actual date of the execution of such Right Certificate, shall be a proper
officer of the Company to sign such Right Certificate, although at the date of
the execution of this Rights Agreement any such person was not such an
officer.
Following the Distribution Date, the Rights Agent will keep or cause
to be kept, at its principal office or offices designated as the appropriate
place for surrender or transfer of such Right Certificate, books for
registration and transfer of the Right Certificates issued hereunder. Such
books shall show the names and addresses of the respective holders of the
Right Certificates, the number of Rights evidenced on its face by each of the
Right Certificates and the date of each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates;
Mutilated, Destroyed, Lost, or Stolen Right Certificates
Subject to the provisions of Section 14 hereof, at any time after the
Close of Business on the Distribution Date, and at or prior to the Close of
Business on the earlier of the Redemption Date or the Final Expiration Date,
any Right Certificate or Right Certificates (other than Right Certificates
representing Rights that have become void pursuant to Section 11(a)(ii) hereof
or that have been exchanged pursuant to Section 24 hereof) may be transferred,
split up, combined, or exchanged for another Right Certificate or Right
Certificates, respectively, entitling the registered holder to purchase a like
number and kind of shares of Common Stock as the Right Certificate or Right
Certificates surrendered then entitled such holder to purchase. Any registered
holder desiring to transfer, split up, combine, or exchange any Right
Certificate or Right Certificates shall make such request in writing delivered
to the Rights Agent, and shall surrender the Right Certificate or Right
Certificates to be transferred, split up, combined, or exchanged at the
principal office or offices of
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the Rights Agent designated for such purpose. Thereupon, the Rights Agent
shall countersign and deliver to the Person entitled thereto a Right
Certificate or Right Certificates, as the case may be, as so requested. The
Company may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer, split
up, combination, or exchange of Right Certificates. Upon receipt by the
Company and the Rights Agent of evidence 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, and, at the Company's request, reimbursement to the
Company and the Rights Agent of all reasonable expenses incidental thereto,
and upon surrender to the Rights Agent and cancellation of the Right
Certificate if mutilated, the Company will make and deliver a new Right
Certificate of like tenor to the Rights Agent for delivery to the registered
holder in lieu of the Right Certificate so lost, stolen, destroyed, or
mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights
(a) Subject to Section 11(a)(ii) hereof, the registered holder of any
Right Certificate may exercise the Rights evidenced thereby (except as
otherwise provided herein) in whole or in part at any time after the
Distribution Date upon surrender of the Right Certificate, with the form of
election to purchase on the reverse side thereof duly executed, to the Rights
Agent at the principal office or offices of the Rights Agent designated for
such purpose, together with payment of the price per share (rounded to the
nearest cent) provided for in paragraph (b) below (the "Purchase Price") for
each share of Common Stock as to which the Rights are exercised, at or prior
to the earliest of (i) the Close of Business on August 17, 2008 (the "Final
Expiration Date"), (ii) the time at which the Rights are redeemed as provided
in Section 23 hereof (the "Redemption Date"), or (iii) the time at which such
Rights are exchanged as provided in section 24 hereof.
(b) The Purchase Price for each share of Common Stock pursuant to the
exercise of a Right shall initially be $200, subject to adjustment from time
to time as provided in Sections 11 and 13 hereof, and shall be payable in
lawful money of the United States of America in accordance with paragraph (c)
below.
(c) Upon receipt of a Right Certificate representing exercisable
Rights, with the form of election to purchase duly executed, accompanied by
payment of the Purchase Price for the shares of Common Stock to be purchased
and an amount equal to any applicable transfer tax required to be paid by the
holder of such Right Certificate in accordance with Section 9 hereof by
certified check, cashier's check, or money order payable to the order of the
Company, the Rights Agent shall thereupon promptly (i) requisition from any
transfer agent of the Common Stock certificates for the number and kind of
shares of Common Stock to be purchased (or depository receipts when
appropriate) and the Company hereby irrevocably authorizes its transfer agents
to comply with all such requests, (ii) when appropriate, requisition from the
Company the amount of cash to be paid in lieu of issuance of fractional shares
in accordance with section 14 hereof, (iii) after receipt of such
certificates, cause the same to be delivered to or upon the order of the
registered holder of such Right Certificate, registered in such name or names
as may be designated by such holder, and (iv) when appropriate, after receipt,
deliver such cash to or upon the order of the registered holder of such Right
Certificate.
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(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) So long as the Common Stock issuable upon the exercise of Rights
may be listed on any national securities exchange, the Company shall use its
reasonable best efforts to cause all shares reserved for such issuance to be
listed on such exchange upon official notice of issuance upon such exercise.
(f) Notwithstanding the foregoing, the Rights shall not be
exercisable under any circumstances unless there shall be at the time of
exercise an effective registration statement under the Securities Act relating
to the issuance of the shares of Common Stock upon the exercise thereof or the
exchange thereof pursuant to Section 24 hereof.
(g) Notwithstanding anything herein to the contrary, no Right shall
constitute an offer to sell or the solicitation of an offer to buy any
securities, nor shall there by any sale of Rights or the issuance of
securities upon exercise of the Rights in any state in which such offer,
solicitation, or sale would be unlawful prior to registration or qualification
under the securities laws of any such states.
Section 8. Cancellation and Destruction of Right Certificates
All Right Certificates surrendered for the purpose of exercise,
transfer, split up, combination, or exchange shall, if surrendered to the
Company or to any of its agents, be delivered to the Rights Agent for
cancellation or in canceled form, or, if surrendered to the Rights Agent,
shall be canceled by it, and no Right Certificates shall be issued in lieu
thereof, except as expressly permitted by any of the provisions of this Rights
Agreement. The Company shall deliver to the Rights Agent for cancellation and
retirement, and the Rights Agent shall so cancel and retire, any other Right
Certificate purchased or acquired by the Company otherwise that upon the
exercise thereof. The Rights Agent shall deliver all canceled Right
Certificates to the Company, or shall, at the written request of the Company,
destroy such canceled Right Certificates, and, in such case, shall deliver a
certificate of destruction thereof to the Company.
Section 9. Availability of Shares of Common Stock
(a) The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued Common Stock or
any Common Stock held in its treasury, the number and kind of shares of Common
Stock that will be sufficient to permit the exercise in full of all
outstanding Rights in accordance with this Rights Agreement.
(b) The Company covenants and agrees that it will take all such
action as may be necessary to ensure that all shares of Common Stock 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 shares of Common Stock.
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(c) The Company 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 Common Stock upon the exercise of Rights. The Company shall not,
however, be required (i) to pay any transfer tax which may be payable in
respect of any transfer or delivery of Right Certificates to a person other
than, or the issuance or delivery of certificates or depository receipts for
the shares of Common Stock in a name other than that of, the registered holder
of the Right Certificate evidencing Rights surrendered for exercise, or (ii)
to issue or to deliver any certificates for shares of Common Stock 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 reasonable
satisfaction that no such tax is due.
Section 10. Record Holders of Common Stock Issued Upon Exercise of Rights
Each person in whose name any certificate for shares of Common Stock
is issued upon the exercise of Rights shall for all purposes be deemed to have
become the holder of record of the shares of Common Stock 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; provided,
however, that if the date of such surrender and payment is a date upon which
the Company's transfer books for the shares of Common Stock 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
such transfer books 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 holder of Common Stock for which the Rights evidenced thereby 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 and Kind of Shares of Common
Stock or Number of Rights
The Purchase Price, the number of shares of Common Stock or other
securities 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 Record
Date (A) declare a dividend on the Common Stock payable in
Common Stock, (B) subdivide the outstanding shares of Common
Stock into a greater number of such shares, (C) combine the
outstanding shares of Common Stock into a smaller number of
such shares, or (D) issue any shares of its capital stock in
a reclassification of the Common 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), the Purchase Price in effect for Rights at the time
of the record date for such dividend or of the effective
date of such subdivision, combination, or reclassification,
and the number and kind of shares of capital stock issuable
on such date, shall be proportionately adjusted so that the
holder of any Right exercised after such time shall, upon
payment of the
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Purchase Price then in effect, be entitled to receive the
aggregate number and kind of shares of capital stock which,
if such Right had been exercised immediately prior to such
date and at a time when the Common Stock transfer books of
the Company were open, he would have owned upon such
exercise and been entitled to receive by virtue of such
dividends, subdivision, combination, or reclassification;
provided, however, that in no event shall the consideration
to be paid upon the exercise of one such Right be less than
the per share par value of the Common Stock. If an event
occurs which would require an adjustment under both Section
11(a)(i) and Section 11(a)(ii), the adjustment provided for
in this Section 11(a)(i) shall be in addition to, and shall
be made prior to, any adjustment required pursuant to
Section 11(a)(ii).
(ii) Subject to Section 24 of this Rights Agreement, in the event
any Person becomes an Acquiring Person, then the Purchase
Price for each share of Common Stock issuable upon exercise
of Rights shall be reduced to an amount equal to 331/3% of
the current market price per share of such Common Stock
(determined pursuant to Section 11(d)) on the Shares
Acquisition Date.) Notwithstanding the above, if the
transaction that would otherwise give rise to the foregoing
adjustment is also subject to the provisions of Section 13
hereof, then only the provisions of Section 13 hereof shall
apply and no adjustment shall be made pursuant to this
Section 11(a)(ii).
From and after the occurrence of the event described above,
any Rights that are or were acquired or beneficially owned
by any Acquiring Person (or any Associate or Affiliate of
such Acquiring Person) shall be void and any holder of such
Rights shall thereafter have no right to exercise such
Rights under any provision of this Rights Agreement. No
Right Certificate shall be issued pursuant to Section 3 that
represents Rights beneficially owned by an Acquiring Person
whose Rights would be void pursuant to the preceding
sentence or any Associate or Affiliate thereof; no Right
Certificate shall be issued at any time upon the transfer of
any Rights to or from an Acquiring Person whose Rights would
be void pursuant to the preceding sentence or any Associate
or Affiliate thereof or to or from any nominee of such
Acquiring Person, Associate or Affiliate; and any Right
Certificate delivered to the Rights Agent for transfer to or
from an Acquiring Person (or any Associate, Affiliate or
nominee of such Acquiring Person) whose Rights would be void
pursuant to the preceding sentence shall be canceled.
(iii) In the event that there shall not be sufficient shares of
Common Stock issued but not outstanding or authorized but
unissued to permit the exercise in full of the Rights in
accordance with the foregoing subparagraph, the Company
shall, to the extent permitted by applicable law, take all
such action as may be necessary to authorize additional
shares of Common Stock for issuance upon exercise of the
Rights, including the calling of a meeting of stockhholders;
provided, however, if the Company is unable to cause the
authorization of additional shares of Common Stock, then the
Company, to the extent necessary and permitted by applicable
law and any agreements or instruments in effect on the date
hereof to which it is a party, shall, at its option (A) pay
cash equal to twice the applicable Purchase Price (as
adjusted pursuant to this Section 11) in lieu of issuing any
such shares of Common Stock and requiring payment therefor,
(B) issue equity securities having a value
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equal to the market price of the shares of Common Stock
which otherwise would have been issuable pursuant to the
foregoing subparagraph, which value shall be determined by
the Board of Directors of the Company, whose determination
shall be described in a statement filed with the Rights
Agent, or (C) distribute a combination of Common Stock,
cash, and/or other equity securities having a value equal to
the market price of the shares of the Common Stock which are
otherwise issuable pursuant to the foregoing subparagraph
(ii), determined in accordance with the preceding clause
(B), upon exercise of the related Rights.
(b) In case the Company shall fix a record date for the issuance of
rights (other than the Rights), options, or warrants to all holders of Common
Stock entitling them (for a period expiring within 45 calendar days after such
record date) to subscribe for or purchase shares of Common Stock, or
securities convertible into shares of Common Stock at a price per share (or
having a conversion price per share, if a security convertible into Common
Stock) less than the then current per share market price (as defined in
Section 11(d)) of the Common Stock on such record date, the Purchase Price to
be in effect after such record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such record date by a fraction,
the numerator of which shall be the number of shares of Common Stock
outstanding on such record date plus the number of shares of Common Stock
which the aggregate offering price of the total number of shares so to be
offered (and/or the aggregate initial conversion price of the convertible
securities so to be offered) would purchase at such current market price and
the denominator of which shall be the number of shares of Common Stock
outstanding on such record date plus the number of additional shares of Common
Stock to be offered for subscription or purchase (or into which the
convertible securities so to be offered are initially convertible); provided,
however, that in no event shall the consideration to be paid upon the exercise
of one Right be less than the per share par value of the shares of capital
stock of the Company issuable upon exercise of one Right. In case such
subscription price may be paid in 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 Common 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 shares of Common 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 quarterly cash dividend, a
dividend payable in shares of Common Stock or other distribution referred to
in Section 11(a) hereof) or subscription rights or warrants (excluding those
referred to in Section 11(b) hereof), the Purchase Price in effect after such
record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of which
shall be the then current per share market price of the Common Stock on such
record date, less the fair market value (as determined in good faith by the
Board of Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the Rights
Agent) of the portion of such assets or evidences of indebtedness so to be
distributed or of such subscription rights or
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<PAGE>
warrants applicable to one share of Common Stock and the denominator of which
shall be such current per share market price of the Common Stock; provided,
however, that in no event shall the consideration to be paid upon the exercise
of one Right be less than the per share par value of the shares of capital
stock of the Company to be issued upon exercise of one Right. Such adjustments
shall be made successively whenever such a record date if 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) For the purpose of any computation hereunder, the "current per
share market price" of a share of Common Stock on any date shall be deemed to
be the average of the daily closing prices per share of Common Stock for the
30 consecutive Trading Days immediately prior to such date; provided, however,
that in the event that the current per share market price of a share of Common
Stock is determined during a period following the announcement by the Company
of (A) a dividend or distribution to holders of the shares of Common Stock,
payable in shares of Common Stock or securities convertible into shares of
Common Stock, or (B) any subdivision, combination, or reclassification of the
Common Stock, and prior to the expiration of 30 Trading Days after the ex
dividend date for such dividend or distribution, or the record date for such
subdivision, combination, or reclassification, then, and in each such case,
the current per share market price shall be appropriately adjusted to reflect
the current market price per share of Common Stock. The closing price for each
day shall be the last sale price, regular way, or, in case no such sale takes
place on such day, the average of the closing bid and asked prices, regular
way, in either case as reported in the principal consolidated transaction
reporting system with respect to securities listed or admitted to trading on
the New York Stock Exchange or, if the Common Stock is not listed or admitted
to trading on the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to securities listed on
the principal national securities exchange on which the Common Stock is listed
or admitted to trading or, if Common Stock is not listed or admitted to
trading on any national securities exchange, the last quoted price or, if not
so quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by The Nasdaq Stock Market, Inc.
("Nasdaq") then in use, or, if on any such date Common Stock is not quoted by
any such organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the 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 Common
Stock on such date as determined in good faith by the Board of Directors of
the Company shall be used, whose determination shall be described in a
statement filed with the Rights Agent. The term "Trading Day" shall mean a day
on which the principal national securities exchange on which Common Stock is
listed or admitted to trading is open for the transaction of business or, if
the Common Stock is not listed or admitted to trading on any national
securities exchange, a Business Day. If the Common Stock is not publicly held
or so listed or traded, "current per share market price" shall mean the fair
value per share as determined in good faith by the Board of Directors of the
Company, whose determination shall be described in a statement filed with the
Rights Agent.
(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 the Purchase Price; provided, however,
that any adjustments which by reason of this Section 11(e) are not required to
be made shall be carried forward and taken into account in any subsequent
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<PAGE>
adjustment. All calculations under this Section 11 shall be made to the
nearest cent or to the nearest one ten-thousandth of a share as the case may
be.
(f) If, as a result of an adjustment made pursuant to Section 11(a)
hereof, the holder of any Right thereafter exercised shall become entitled to
receive any shares of capital stock of the Company other than shares of Common
Stock, thereafter the number of such other shares so receivable upon exercise
of any Right shall be subject to adjustment from time to time in a manner and
on terms as nearly equivalent as practicable to the provisions with respect to
the Common Stock contained in Section 11(a) through (c), inclusive, and the
provisions of Sections 7, 9, 10, 13 and 14 with respect to the Common Stock
shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made hereunder to the Purchase Price applicable thereto shall
evidence the right to purchase, at the adjusted Purchase Price, the number of
shares of Common Stock or other capital stock purchasable from time to time
hereunder upon exercise of such Rights, all subject to further adjustment as
provided herein.
(h) Unless the Company shall have exercised its election as provided
in Section 11(i), upon each adjustment of the Purchase Price as a result of
the calculations made in Sections 11(b) and (c), each related Right
outstanding immediately prior to the making of such adjustment shall
thereafter evidence the right to purchase, at the adjusted Purchase Price, the
number of shares of Common Stock (calculated to the nearest one ten-thousandth
of a share) obtained by (i) multiplying (x) the number of shares covered by
such Right immediately prior to this adjustment by (y) the Purchase Price in
effect immediately prior to such Purchase Price adjustment, and (ii) dividing
the product so obtained by the Purchase Price in effect immediately after such
Purchase Price adjustment.
(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 Common Stock purchasable upon the
exercise of a Right. Each of such Rights outstanding after such adjustment of
the number of such Rights shall be exercisable for the number of shares of
Common Stock for which such Right was exercisable immediately prior to such
adjustment. Each such Right held of record prior to such adjustment of the
number of Rights shall become that number of such Rights (calculated to the
nearest one ten-thousandth) obtained by dividing the Purchase Price in effect
immediately prior to adjustment of such Purchase Price by the Purchase Price
in effect immediately after such adjustment. The Company shall make a public
announcement of its election to adjust the number of Rights indicating the
record date for the adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which the Purchase
Price is adjusted or any day thereafter, but, if the Right Certificates have
been issued, shall be at least 10 days later than the date of the public
announcement. If Right Certificates have been issued, upon each adjustment of
the number of such Rights pursuant to this Section 11(i), the Company shall,
as promptly as practicable, cause to be distributed to holders of record of
such Right Certificates on such record date 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 such 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.
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<PAGE>
Right Certificates so to be distributed shall be issued, executed, and
countersigned in the manner provided for herein and shall be registered in the
names of the holders of record of Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase Price or
the number of shares of Common Stock issuable upon the exercise of the Rights,
the Right Certificates theretofore and thereafter issued may continue to
express the Purchase Price and the number of shares of Common Stock which were
expressed in such Right Certificates theretofore issued hereunder.
(k) Before taking any action that would cause an adjustment reducing
the Purchase Price below the then par value, if any, of the shares of Common
Stock issuable upon exercise of the Rights, the Company shall take any
corporate action which may, in the opinion of its counsel, be necessary in
order that the Company may validly and legally issue fully paid and
nonassessable shares of Common 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 issuing to the holder of any related Right exercised after such
record date of the Common Stock and other capital stock or securities of the
Company, if any, issuable upon such exercise over and above the shares of
Common 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, but shall not be required, to make such reductions
in the Purchase Price in addition to those adjustments expressly required by
this Section 11, as and to the extent that it in its sole discretion shall
determine to be advisable in order that (i) any consolidation or subdivision
of the Common Stock, (ii) issuance wholly for cash of any Common Stock at less
than the current market price, (iii) issuance wholly for cash or Common Stock
or securities which by their terms are convertible into or exchangeable for
shares of Common Stock, (iv) dividends on the Common Stock payable in shares
of Common Stock, or (v) issuance of rights, options, or warrants referred to
hereinabove in Section 11(b), hereafter made by the Company to holders of
shares of Common 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 or 27 hereof, take (or
permit any Subsidiary to take) any action the purpose of which is to, or if at
the time such action is taken it is reasonably foreseeable that the effect of
such action is to, materially diminish or otherwise eliminate the benefits
intended to be afforded by the Rights. [Notwithstanding the foregoing, prior
to the Distribution Date the Company shall be entitled to amend this Rights
Agreement and the Rights in any and all respects.]
Section 12. Certificate of Adjustment
Whenever an adjustment is made as provided in Sections 11 or 13
hereof, the Company shall promptly (a) prepare a certificate setting forth
such adjustment, and a brief statement of the facts
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<PAGE>
accounting for such adjustment, (b) file with the Rights Agent and with each
transfer agent for the Common Stock a copy of such certificate, and (c)
include a brief summary thereof in the next quarterly or current report filed
pursuant to the Exchange Act by the Company, and, following the Distribution
Date, mail such summary to each holder of a Right Certificate in accordance
with Section 25 hereof.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning
Power
(a) In the event that, on or following the Distribution Date,
directly or indirectly, (x) the Company shall consolidate with, or merge with
and into, any other Person, (y) the Company shall consolidate with, or merge
with, any other Person, and the Company shall be the continuing or surviving
corporation of such consolidation or merger (other than, in a case of any
transaction described in (x) or (y), a merger or consolidation which would
result in all of the securities generally entitled to vote in the election of
directors ("Voting Securities") of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into securities of the surviving entity) all of the voting
securities of the Company or such surviving entity outstanding immediately
after such merger or consolidation and the holders of such securities not
having changed as a result of such merger or consolidation), or (z) the
Company shall sell or otherwise transfer (or one or more of its Subsidiaries
shall sell or otherwise transfer), in one or a series of related 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 (other than the Company or any Subsidiary of the Company in one or more
transactions each of which does not violate Section 11(n) hereof), then, and
in each such case (except as provided in Section 13(d) hereof), proper
provision shall be made so that (i) each holder of a Right, except as provided
in Section 11(a) hereof, shall thereafter have the right to receive, upon the
exercise thereof at a price equal to the then current Purchase Price (without
giving effect to any adjustment to such Purchase Price pursuant to Section
11(a)(ii)) multiplied by the number of shares of Common Stock for which such
Right is then exercisable, in accordance with the terms of this Rights
Agreement, such number of freely tradable shares of Common Stock of the
Principal Party, not subject to any liens, encumbrances, rights of first
refusal, or other adverse claims, as shall equal the result obtained by (A)
multiplying the then current Purchase Price (without giving effect to any
adjustment to such Purchase Price pursuant to Section 11(a)(ii)) by the number
of shares of Common Stock for which such Right is then exercisable and (B)
dividing that product by 50% of the then current per share market price of the
Common Stock of such Principal Party (determined pursuant to Section 11(d)
hereof) on the date of consummation of such consolidation, merger, sale, or
transfer; (ii) such Principal Party shall thereafter be liable for, and shall
assume, by virtue of such consolidation, merger, sale, or transfer, all of the
obligations and duties of the Company pursuant to this Rights 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 hereof
shall apply only to such Principal Party following the first occurrence of an
event described in this Section 13; and (iv) such Principal Party shall take
such steps (including, but not limited to, the reservation of a sufficient
number of its shares of Common Stock in accordance with Section 9 hereof) in
connection with such consummation as may be necessary to assure that the
provisions hereof shall thereafter be applicable, as nearly as reasonably may
be, in relation to the shares of Common Stock thereafter deliverable upon the
exercise of the Rights.
(b) "Principal Party" shall mean
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(i) in the case of any transaction described in clause (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 such merger or
consolidation (including, if applicable, the Company if it
is the surviving corporation); and
(ii) in the case of any transaction described in clause (z) of
the first sentence of Section 13(a), the Person that is the
party receiving the greatest portion of the assets or
earnings power transferred pursuant to such transaction or
transactions; provided, however, that in any of the
foregoing cases, (1) if the shares of Common Stock of such
Person are not at such time and have not been continuously
over the preceding twelve (12) month period registered under
Section 12 of the Exchange Act, and such Person is a direct
or indirect Subsidiary of another Person the shares of
Common Stock of which are and have been so registered,
"Principal Party" shall refer to such other Person; (2) in
case such Person is a Subsidiary, directly or indirectly, of
more than one Person, the shares of Common Stock of two or
more of which are and have been so registered, "Principal
Party" shall refer to whichever of such Persons is the
issuer of the Common Stock having the greatest aggregate
market value; and (3) in case such Person is owned, directly
or indirectly, by a joint venture formed by two or more
Persons that are not owned, directly or indirectly, by the
same Person, the rules set forth in (1) and (2) above shall
apply to each of the chains of ownership having an interest
in such joint ventures as if such party were a "Subsidiary"
of both or all of such joint ventures and the Principal
Parties in each such chain shall bear the obligations set
forth in this Section 13 in the same ratio as their direct
or indirect interests in such Person bear to the total of
such interests.
(c) The Company shall not consummate any such consolidation, merger,
sale, or transfer unless the Principal Party shall have a sufficient number of
shares of its authorized shares of Common Stock which have not been issued or
reserved for issuance to permit the exercise in full of the Rights in
accordance with this Section 13 and unless prior 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, sale, or transfer mentioned in
paragraph (a) of this Section 13, the Principal Party at its own expense
shall:
(i) prepare and file a registration statement under the
Securities Act, with respect to the Rights and the
securities purchasable upon exercise of the Rights on an
appropriate form, and will use its best efforts to cause
such registration statement to (A) become effective as soon
as practicable after such filing and (B) remain effective
(with a prospectus at all times meeting the requirements of
the Securities Act) until the Final Expiration Date;
(ii) use its best efforts to qualify or register the Rights and
the securities purchasable upon exercise of the Rights under
the blue sky laws of such jurisdictions as may be necessary
or appropriate; and
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(iii) deliver to holders of the Rights historical financial
statements for the Principal Party 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
mergers or consolidations or sales or other transfers. In the event that the
events described in this Section 13 shall occur at any time after the
occurrence of the events described in Section 11(a)(ii), the Rights which have
not theretofore been exercised shall thereafter become exercisable in the
manner described in Section 13(a).
(d) Notwithstanding anything in this Agreement to the contrary,
Section 13 shall not be applicable to a transaction described in subparagraphs
(x) and (y) of Section 13(a) if (i) such transaction is consummated with a
Person or Persons who acquired shares of Common Stock pursuant to a Permitted
Offer (or a wholly owned subsidiary of any such Person or Persons), (ii) the
price per share of the Common Stock offered in such transaction is not less
than the price per share of Common Stock whose shares were purchased pursuant
to such tender offer or exchange offer, and (iii) the form of consideration
being offered to the remaining holders of shares of Common Stock pursuant to
such transaction is the same as the form of consideration paid pursuant to
such tender offer or exchange offer. Upon consummation of any such transaction
contemplated by this Section 13(d), all Rights hereunder shall expire.
Section 14. Fractional Rights and Fractional Shares
(a) The Company shall not be required to issue fractions of Rights or
to distribute Right Certificates which evidence fractional Rights. In lieu of
such fractional Rights, there shall be paid to the registered holders of the
Right Certificates with regard to which such fractional Rights would otherwise
be issuable, an amount in cash equal to the same fraction of the current
market value of a whole Right. For the purposes of this Section 14(a), the
current market value of a whole Right shall be the closing price of such
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 closing 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 such 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 such 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 such Rights on such date 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,
shall be used.
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(b) The Company shall not be required to issue fractions of shares of
Common Stock upon exercise of the Rights or exchange of the Rights for shares
of Common Stock pursuant to Section 24 of this Rights Agreement, or to
distribute certificates which evidence fractional shares of such securities.
Fractions of shares of Common Stock may, at the election of the Company, be
evidenced by depository receipts, pursuant to an appropriate agreement between
the Company and a depositary selected by it; provided that such agreement
shall provide that the holders of such depositary receipts shall have the
rights, privileges, and preferences to which they are entitled as beneficial
owners of the shares of Common Stock represented by such depositary receipts.
In lieu of fractional shares of Common Stock or depositary receipts, 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 share of Common Stock. For
the purposes of this Section 14(b), the current market value of a share of
Common Stock shall be the closing price of a share of Common Stock (as
determined pursuant to the second sentence of Section 11(d) hereof) for the
Trading Day immediately prior to the date of such exercise.
(c) The holder of a Right by the acceptance of such Right expressly
waives his right to receive any fractional Rights or any fractional shares
upon exercise of a Right (except as provided above).
Section 15. Rights of Action
All rights of action in respect of this Rights Agreement, excepting
the rights of action given to the Rights Agent under Section 18 hereof, are
vested in the respective registered holders of the Right Certificates (and,
prior to the Distribution Date, the registered holders of the shares of Common
Stock); and any registered holder of any Right Certificate (or, prior to the
Distribution Date, of the shares of 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 shares of 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 in respect of,
his right to exercise the Rights evidenced by such Right Certificate in the
manner provided in such Right Certificate and in this Rights 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 Rights Agreement and
will be entitled to specific performance of the obligations under, and
injunctive relief against actual or threatened violations of the obligations
of any Person subject to, this Rights 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 shares of 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 principal office of the Rights Agent, duly endorsed or accompanied by a
proper instrument of transfer;
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(c) the Company and the Rights Agent may deem and treat the person in
whose name the Right Certificate (or, prior to the Distribution Date, the
associated certificates for shares of Common Stock) 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 certificates for shares of Common Stock made by anyone other than
the Company or the Rights Agent) for all purposes whatsoever, and neither the
Company nor the Rights Agent shall be affected by any notice to the contrary;
(d) notwithstanding anything in this Rights Agreement to the
contrary, neither the Company nor the Rights Agent shall have any liability to
any holder of a Right or a beneficial interest in a Right or other Person as a
result of its inability to perform any of its obligations under this Rights
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 its best reasonable
efforts to have any such order, decree, or ruling lifted or otherwise
overturned as soon as possible; and
(e) prior to the Distribution Date, the Company shall be entitled to
amend this Rights agreement and the Rights in any and all respects.
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 shares of
Common Stock or any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby, nor shall anything
contained herein or in any Right Certificate be construed to confer upon the
holder of any Right Certificate, as such, any of the rights of a stockholder
of the Company or any right to vote for the election of directors or upon any
matter submitted to stockholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of meetings or
other actions affecting stockholders (except as provided in Section 25
hereof), or to receive dividends or subscription rights, or otherwise, until
the Right or Rights evidenced by such Right Certificate shall have been
exercised in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent
The Company agrees to pay to the Rights Agent reasonable compensation
for all services rendered by it hereunder and, from time to time, on demand of
the Rights Agent, its reasonable expenses, counsel fees, and other
disbursements incurred in the administration and execution of this Rights
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, for anything
done or omitted by the Rights Agent in connection with the acceptance and
administration of this Rights Agreement, including the costs and expenses of
defending against any claim of liability in the indemnity provided for herein.
Such right to indemnification shall survive the expiration of the Rights and
the termination of this Rights Agreement.
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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 Rights Agreement in reliance upon any Right
Certificate or certificate for shares of Common Stock or for other securities
of the Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate,
statement, or other paper or document believed by it to be genuine and to be
signed, executed, and, where necessary, verified or acknowledged, by the
proper Person or Persons, or otherwise upon the advice of counsel as set forth
in Section 20 hereof.
Section 19. Merger or Consolidation or Change of Name of Rights Agent
Any 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
stock transfer or all or substantially all of the corporate trust business of
the Rights Agent or any successor Rights Agent, shall be the successor to the
Rights Agent under this Rights Agreement without the execution or filing of
any paper or any further act on the part of any of the parties hereto,
provided that such corporation would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21 hereof. In case at
the time such successor Rights Agent shall succeed to the agency created by
this Rights Agreement any of the Right Certificates shall have been
countersigned, but not delivered, any such successor Rights Agent may adopt
the countersignature of the predecessor Rights Agent and deliver such Right
Certificates so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Right Certificates either in the name of the predecessor
Rights Agent or in the name of the successor Rights Agent; and in all such
cases such Right Certificates shall have the full force provided in the Right
Certificates and in this Rights Agreement.
In case at any time the name of the Rights Agent shall be changed and
at such time any of the Right Certificates shall have been countersigned but
not delivered, the Rights Agent may adopt the countersignature under its prior
name and deliver Right Certificates so countersigned; and in case at that time
the 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 Rights Agreement.
Section 20. Duties of Rights Agent
The Rights Agent undertakes the duties and obligations imposed by
this Rights Agreement upon the following terms and conditions, by all of which
the Company and the holders of Right Certificates, by their acceptance
thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may be, but
need not be, legal counsel for the Company or its own in-house counsel), 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.
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(b) Whenever in the performance of its duties under this Rights
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 of Directors, the Chief Executive Officer, the President, any Vice
President, the Treasurer, or the Secretary of the Company and delivered to the
Rights Agent; and such certificate shall be full authorization to the Rights
Agent for any action taken or suffered in good faith by it under the
provisions of this Rights Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder to the Company and any
other Person only for its own negligence, bad faith, or willful misconduct.
(d) The Rights Agent shall not be liable for, or by reason of, any of
the statements of fact or recitals contained in this Rights Agreement or in
the Right Certificates (except its countersignature on such Rights
Certificates) or be required to verify the same, but all such statements and
recitals are, and shall be deemed to have been, made by the Company only.
(e) The Rights Agent shall not be under any responsibility in respect
of the validity of this Rights 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 Rights Agreement or in any Right
Certificate; nor shall it be responsible for any change in the exercisability
of the Rights (including the Rights becoming void pursuant to Section
11(a)(ii) hereof) or any adjustment in the terms of the Rights (including the
manner, method, or amount thereof) provided for in Sections 3, 7, 11, 13, 23,
or 24 hereof, or the ascertaining of the existence of facts that would require
any such change or adjustment (except with respect to the exercise of Rights
evidenced by Right Certificates after actual notice that such change or
adjustment is required); nor shall it by any act hereunder be deemed to make
any representation or warranty as to the authorization or reservation of any
shares of Common Stock to be issued pursuant to this Rights Agreement or any
Right Certificate or as to whether any shares of 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 Rights Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from any
one of the Chairman of the Board of Directors, the Chief Executive Officer,
the President, any Vice President, the Treasurer, or the Secretary of the
Company, and to apply to such officers for advice or instructions in
connection with its duties, and it shall not be liable for any action taken or
suffered by it in good faith in accordance with instructions of any such
officer or for any delay in acting while waiting for those instructions.
(h) The Rights Agent and any stockholder, 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
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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 Rights Agreement. Nothing
herein shall preclude the Rights Agent from acting in any other capacity for
the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself or by
or through its attorneys or agents, and the Rights Agent shall not be
answerable or accountable for any act, default, neglect, or misconduct of any
such attorneys or agent or for any loss to the Company resulting from any such
act, default, neglect, or misconduct, provided reasonable care was exercised
in the selection.
Section 21. Change of Rights Agent
The Rights Agent or any successor Rights Agent may resign and be
discharged from its duties under this Rights Agreement upon 30 days' notice in
writing mailed to the Company and to each transfer agent of the shares of
Common Stock by registered or certified mail, and to the holders of the Right
Certificates by first-class mail. The Company may remove the Rights Agent or
any successor Rights Agent upon 30 days' notice in writing, mailed to the
Rights Agent or successor Rights Agent, as the case may be, and to each
transfer agent of the shares of 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 30 days after
giving notice of such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights Agent or by
the holder of a Right Certificate (who shall, with such notice, submit his
Right Certificate for inspection by the Company), then the registered holder
of any Right Certificate may apply to any court of competent jurisdiction for
the appointment of a new Rights Agent. Any successor Rights Agent, whether
appointed by the Company or by such a court, shall be (a) a corporation
organized and doing business under the laws of the United States or of any
state of the United States, in good standing, which is authorized under such
laws to exercise corporate trust or stock transfer powers and is subject to
supervision or examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined capital and surplus of at
least $25 million, or (b) an affiliate of a corporation described in clause
(a) of this sentence. After appointment, the successor Rights Agent shall be
vested with the same powers, rights, duties, and responsibilities as if it had
been originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver
any further assurance, conveyance, act, or deed necessary for the purpose. Not
later than the effective date of any such appointment the Company shall file
notice thereof in writing with the predecessor Rights Agent and each transfer
agent of the shares of 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.
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Section 22. Issuance of New Right Certificates
Notwithstanding any of the provisions of this Rights Agreement or of
the Rights, 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 Rights Agreement
In addition, in connection with the issuance or sale of shares of
Common Stock following the Distribution Date and prior to the earlier of the
Redemption Date and the Final Expiration Date, 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, notes, or debentures 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) the Company shall not be obligated to
issue any such Right Certificates 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 Right Certificate shall be
issued if, and to the extent that, appropriate adjustment shall otherwise have
been made in lieu of the issuance thereof.
Section 23. Redemption
(a) The Board of Directors of the Company may, at its option, at any
time prior to such time as any Person becomes an Acquiring Person, redeem all,
but not less than all, of the then outstanding Rights at an initial redemption
price of $0.001 per Right (the "Redemption Price"). The Redemption Price shall
be appropriately adjusted to reflect any stock split, stock dividend, or
similar transaction occurring after the date hereof. The redemption of the
Rights by the Board of Directors may be made effective at such time, on such
basis, and with such conditions as the Board of Directors in its sole
discretion may establish.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights pursuant to paragraph (b) of
this Section 23 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. The Company
shall promptly give public notice of any such redemption; provided, however,
that the failure to give, or any defect in, any such notice shall not affect
the validity of such redemption. Within 10 days after such action of the Board
of Directors ordering the redemption of the Rights, the Company shall mail a
notice of redemption to all the holders of the then outstanding Rights at
their last addresses as they appear upon the registry books of the Rights
Agent or, prior to the Distribution Date, on the registry books of the
transfer agent for the shares of Common Stock. Any notice which is mailed in
the manner herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of redemption will state the method by
which the payment of the Redemption Price will be made. Neither the Company
nor any of its Affiliates or Associates may redeem, acquire, or purchase for
value any Rights at any time in any manner other than that specifically set
forth in this
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Section 23 or in Section 24 hereof, and other than in connection with the
purchase of shares of Common Stock prior to the Distribution Date.
Section 24. Exchange
(a) The Board of Directors of the Company may, at its option, at any
time after any Person becomes an Acquiring Person, exchange all or part of the
then outstanding and exercisable Rights (which shall not include Rights that
have become void pursuant to the provisions of Section 11(a)(ii) hereof) for
shares of Common Stock at an exchange ratio of one share of Common Stock per
Right, appropriately adjusted to reflect any stock split, stock dividend, or
similar transaction occurring after the date hereof (such exchange ratio being
hereinafter referred to as the "Exchange Ratio"). Notwithstanding the
foregoing, the Board of Directors shall not be empowered to effect such
exchange at any time after any Person (other than the Company, any Subsidiary
of the Company, any employee benefit plan of the Company or any such
Subsidiary, any entity holding shares of Common Stock for or pursuant to the
terms of any such plan or any trust agreement entered into by the Company to
secure benefits payable under any employee benefit plan of the Company or any
Subsidiary of the Company or any member of the Board of Directors on the date
of effectiveness of this Rights Agreement), together with all Affiliates and
Associates of such Person, becomes the Beneficial Owner of shares of Common
Stock representing 50% or more of the shares of Common Stock then outstanding.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the exchange of any Rights pursuant to subsection (a) of this
Section 24 and without any further action and without any notice, the right to
exercise such Rights shall terminate and the only right thereafter of a holder
of such Rights shall be to receive that number of shares of Common Stock equal
to the number of such Rights held by such holder multiplied by the Exchange
Ratio. The Company shall promptly give public notice of any such exchange;
provided, however, that the failure to give, or any defect in, such notice
shall not affect the validity of such exchange. The Company shall promptly
mail a notice of any such exchange to all of the holders of the Rights at such
last addresses as they appear upon the registry books of the Rights Agent. Any
notice which is mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice. Each such notice of exchange
will state the method by which the exchange of the shares of Common Stock for
Rights will be effected and, in the event of any partial exchange, the number
and kind of Rights which will be exchanged. Any partial exchange shall be
effected pro rata based on the number of Rights being exchanged (other than
Rights which have become void pursuant to the provisions of Section 11(a)(ii)
hereof) held by each holder of such Rights.
(c) In the event that there shall not be sufficient shares of Common
Stock issued, but not outstanding or authorized, but unissued to permit any
exchange of Rights as contemplated in accordance with this Section 24, the
Company shall take all such action as may be necessary to authorize additional
shares of Common Stock for issuance upon exchange of the Rights.
Section 25. Notice of Certain Events
(a) In case the Company, following the Distribution Date, shall
propose (i) to pay any dividend payable in stock of any class or series to
holders of shares of Common Stock or to make any other distribution to holders
of shares of Common Stock (other than a regular quarterly cash
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dividend), (ii) to offer to holders of shares of Common Stock rights or
warrants to subscribe for, or to purchase, any additional shares of Common
Stock or any other securities, rights, or options, (iii) to effect any
reclassification of the Common Stock (other than a reclassification involving
only the subdivision of outstanding shares of Common Stock), (iv) to effect
any consolidation or merger with or into, or to effect any sale or other
transfer (or to permit one or more of its Subsidiaries to effect any sale or
other transfer), in one or more transactions, of 50% or more of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to, any
other Person (other than the Company and/or any of its Subsidiaries in one or
more transactions each of which does not violate Section 11(n) hereof), or (v)
to effect the liquidation, dissolution, or winding up of the Company, then, in
each such case, the Company shall give to each holder of a Right Certificate,
in accordance with Section 26 hereof, a notice of such proposed action to the
extent feasible, which shall specify the record date for the purposes of such
stock dividend, or distribution of rights or warrants, or the date on which
such reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution, or winding up is to take place and the date of participation
therein by holders of shares of Common 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
(i) or (ii) above at least 10 days prior to the record date for determining
holders of shares of Common Stock for purposes of such action, and in the case
of any such other action, at least 10 days prior to the date of the taking of
such proposed action or the date of participation therein by holders of shares
of Common Stock, whichever shall be the earlier. The failure to give notice
required by this Section 25 or any defect therein shall not affect the
legality or validity of the action taken by the Company or the vote upon any
such action.
(b) In case any of the events set forth in Section 11(a)(ii) hereof
shall occur, then the Company shall as soon as practicable thereafter give to
each holder of a Right Certificate, in accordance with Section 26 hereof, a
notice of the occurrence of such event, which notice shall describe such event
and the consequences of such event to holders of Rights under Section
11(a)(ii) hereof.
Section 26. Notices
Notices or demands authorized by this Rights Agreement to be given or
made by the Rights Agent or by the holder of any Right Certificate to or on
the Company shall be sufficiently given or made if sent by first-class mail,
postage prepaid, addressed (until another address is filed in writing with the
Rights Agent) as follows:
Imatec, Ltd.
150 East 58th Street
New York, New York 10155
Attention: President
Subject to the provisions of Section 21 hereof, any notice or demand
authorized by this Rights Agreement to be given or made by the Company or by
the holder of any Right Certificate
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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:
Continental Stock Transfer & Trust Company
2 Broadway
Floor 19
New York, New York 10004
Attention: Compliance Department
Notices or demands authorized by this Rights 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 Distribution Date, the Company and the Rights Agent
shall, if the Company so directs, supplement or amend any provision of this
Rights Agreement without the approval of any holders of certificates
representing shares of Common Stock. From and after the Distribution Date, the
Company and the Rights Agent shall, if the Company so directs, supplement or
amend this Rights Agreement without the approval of any holders of Rights
Certificates in order (i) to cure any ambiguity, (ii) to correct or supplement
any provision contained herein which may be defective or inconsistent with any
other provisions herein, (iii) to shorten or lengthen any time period
hereunder, 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);
provided, however, that this Rights Agreement may not be supplemented or
amended to lengthen, pursuant to clause (iii) of this sentence, (A) a time
period relating to when the Rights may be redeemed at such time as the Rights
are not then redeemable, or (B) any other time period unless such lengthening
is for the purpose of protecting, enhancing, or clarifying the rights of,
and/or the benefits to, the holders of Rights. Without limiting the foregoing,
the Company may at any time prior to such time as any Person becomes an
Acquiring Person amend this Rights Agreement to lower the thresholds set forth
in Sections 1(a) and 3(a) hereof from 20% to not less than the greater of (i)
any percentage greater than the largest percentage of the then outstanding
shares of Common Stock then known by the Company to be beneficially owned by
any Person (other than the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or any Subsidiary of the Company, any
entity holding shares of Common Stock for or pursuant to the terms of any such
plan, any person exempted from the definition of Acquiring Person pursuant to
the last sentence of the definition thereof set forth in Section 1 of this
Rights Agreement, or any member of the Board of Directors of the Company on
the effective date of this Rights Agreement) together with all Affiliates or
Associates of such Person, or (ii) 10%. 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, provided that
such supplement or amendment does not adversely affect the rights or
obligations of the Rights Agent under Section 18 or Section 20 of this Rights
Agreement. Prior to the Distribution Date, the interests of the holders of
Rights shall be deemed coincident with the interests of the holders of shares
of Common Stock.
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Section 28. Successors
All the covenants and provisions of this Rights 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. Detections by the Board of Directors
For all purposes of this Rights 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 last sentence of Rule 13d-3(d)(1)(i) of the
General Rules and Regulations under the Exchange Act. The Board of Directors
of the Company shall have the exclusive power and authority to administer this
Rights Agreement and to exercise all rights and powers specifically granted to
the Board of Directors or to the Company, or as may be necessary or advisable
in the administration of this Rights Agreement, including, without limitation,
the right and power to (i) interpret the provisions of this Rights Agreement,
and (ii) make all determinations deemed necessary or advisable for the
administration of this Rights Agreement (including a determination to redeem
or not redeem the Rights or to amend the Rights Agreement or a determination
that an adjustment to the Redemption Price or Exchange Ratio is or is not
appropriate). All such actions, calculations, interpretations, and
determinations (including, for purposes of clause (y) below, all omissions
with respect to the foregoing) which are done or made by the Board of
Directors in good faith, shall (x) be final, conclusive, and binding on the
Company, the Rights Agent, the holders of the Rights, and all other parties,
and (y) not subject the Board of Directors to any liability to the holders of
the Rights.
Section 30. Benefits of the Rights Agreement
Nothing in this Rights Agreement shall be construed to give to any
person or corporation other than the Company, the Rights Agent, and the
registered holders of the Right Certificates (and, prior to the Distribution
Date, the shares of Common Stock) any legal or equitable right, remedy, or
claim under this Rights Agreement; but this Rights Agreement shall be for the
sole and exclusive benefit of the Company, the Rights Agent, and the
registered holders of the Right Certificates (and, prior to the Distribution
Date, the shares of Common Stock).
Section 31. Severability
If any term, provision, covenant, or restriction of this Rights
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 Rights Agreement shall remain in full
force and effect and shall in no way be affected, impaired, or invalidated.
Section 32. Governing Law
This Rights Agreement and each Right Certificate issued hereunder
shall be deemed to be under the laws of the State of Delaware and for all
purposes shall be governed by, and construed in
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accordance with, the laws of such State applicable to contracts to be made and
performed entirely within such State.
Section 33. Counterparts
This Rights Agreement may be executed in any number of counterparts
and each of such counterparts shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and the
same instrument.
Section 34. Descriptive Headings
Descriptive headings of the several Sections of this Rights Agreement
are inserted for convenience only and shall not control or affect the meaning
or construction of any of the provisions hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Rights
Agreement to be duly executed and attested, all as of the day and year first
written above.
IMATEC, LTD.
Attest:
By: ____________________________ By:_______________________________________
Assistant Secretary Dr. Hanoch Shalit
Chairman of the Board of Directors,
President, and Chief Executive
Officer
CONTINENTAL STOCK TRANSFER
& TRUST COMPANY
Attest:
By: ____________________________ By:_______________________________________
Assistant Secretary Vice President
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EXHIBIT A
FORM OF RIGHT CERTIFICATE
Certificate No. R-_______ ______ Rights
NOT EXERCISABLE AFTER AUGUST 17, 2008 OR EARLIER IF REDEMPTION OR EXCHANGE
OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $0.001 PER RIGHT AND TO
EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.
Right Certificate
IMATEC, LTD.
This certifies that ____________________ or registered assigns, is
the registered owner of the number of Rights set forth above, each of which
entitles the owner thereof, subject to the terms, provisions and conditions of
the Rights Agreement, dated as of August 17, 1998 (the "Rights Agreement"),
between Imatec, Ltd., a Delaware corporation (the "Company") and Continental
Stock Transfer & Trust Company (the "Rights Agent"), to purchase from the
Company at any time after the Distribution Date (as such term is defined in
the Rights Agreement) and prior to 5:00 P.M. New York City local time, on
August 17, 1998, at the principal office of the Rights Agent, or at the office
of its successor as Rights Agent, one fully paid non-assessable share of
Imatec, Ltd. Common Stock, par value $0.0001 per share (the "Stock"), at a
purchase price of $1,200 per share (the "Purchase Price"), upon presentation
and surrender of this Right Certificate with the Form of Election to Purchase
duly executed. The number of Rights evidenced by this Right Certificate (and
the number of shares of Stock which may be purchased upon exercise hereof) set
forth above, and the Purchase Price set forth above, are the number and
Purchase Price as of August 28, 1998, (the "Record Date") based on the shares
of Stock of the Company as constituted at such date. As provided in the Rights
Agreement, the Purchase Price and the number of shares of Stock which may be
purchased upon the exercise of the Rights evidenced by this Right Certificate
are subject to modification and adjustment upon the happening of certain
events.
This Right Certificate is subject to all of the terms, provisions,
and conditions of the Rights Agreement, which terms, provisions, and
conditions are hereby incorporated herein by reference and made a part hereof
and to which Rights Agreement reference is hereby made for a full description
of the rights, limitations of rights, obligations, duties and immunities
hereunder of the Rights Agent and the holders of the Right Certificates.
Copies of the Rights Agreement are on file at the principal executive offices
of the Company and the above-mentioned offices of the Rights Agent.
This Right Certificate, with or without other Rights Certificates,
upon surrender at the principal office of the Rights Agent, may be exchanged
for another Right Certificate or Certificates of like tenor and date
evidencing Rights entitling the holder to purchase a like aggregate number of
shares of Stock as the Rights evidenced by the Right Certificate or
Certificates surrendered shall have entitled such holder to purchase. If this
Right Certificate shall be exercised in part, the holder
<PAGE>
shall be entitled to receive upon surrender hereof another Right Certificate
or Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Right Certificate (i) may be redeemed by the Company at its
option at a redemption price of $ 0.001 per Right, or (ii) may be exchanged in
whole or in part for shares of Stock. No fractional shares of Stock will be
issued upon the exercise of any Right or Rights evidenced hereby, 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,
receive dividends, or be deemed for any purpose the holder of the shares of
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 Rights Agreement.
This Right Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
Witness the facsimile signature of the proper officers of the Company
and its corporate seal. Dated as of August 28, 1998.
ATTEST: IMATEC, LTD.
By: ____________________________
Dr. Hanoch Shalit
Chairman of the Board of Directors,
President, and Chief Executive
Officer
Countersigned: ___________________________
CONTINENTAL STOCK TRANSFER
& TRUST COMPANY
By: ___________________________________
[Authorized Signature]
<PAGE>
EXHIBIT A - 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 will 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: ______________________, 19/20____ _____________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a registered
national securities exchange, a member of the National Association of
Securities Dealers, Inc., or a commercial bank or trust company having an
office or correspondent in the United States.
----------------------------------------------------
The undersigned hereby certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).
___________________________________
Signature
<PAGE>
EXHIBIT B
SUMMARY OF RIGHTS TO
PURCHASE SHARES OF COMMON STOCK
Effective as of August 17, 1998, the Board of Directors of Imatec,
Ltd. (the "Company") adopted a Rights Agreement (the "Rights Agreement") and
authorized and declared a dividend of one common share purchase right (a
"Right") for each outstanding share of common stock, par value $0.001 per
share of the Company (the "Common Stock"). The dividend is payable on August
28, 1998, to the stockholders of record on that date (the "Record Date"), and
with respect to shares of Common Stock issued thereafter until the
Distribution Date (as hereinafter defined) or the expiration or earlier
redemption or exchange of the Rights. Except as set forth below, each Right
entitles the registered holder to purchase from the Company, at any time after
the Distribution Date one share of Common Stock at a price per share of
$1,200, subject to adjustment (the "Purchase Price"). The description and
terms of the Rights are as set forth in the Rights Agreement.
Initially the Rights will be attached to all certificates
representing shares of Common Stock then outstanding, and no separate Rights
Certificates will be distributed. The Rights will separate from the shares of
Common Stock upon the earlier to occur of (i) 10 days after the public
announcement of a person's or group of affiliated or associated persons'
having acquired beneficial ownership of 20% or more of the outstanding shares
of Common Stock (such person or group being hereinafter referred to as an
"Acquiring Person"); or (ii) 10 days (or such later date as the Board of
Directors may determine) following the commencement of, or announcement of an
intention to make, a tender offer or exchange offer the consummation of which
would result in a person or group's becoming an Acquiring Person (the earlier
of such dates being called the "Distribution Date").
The Rights Agreement provides that, until the Distribution Date, the
Rights will be transferred with, and only with, the shares of Common Stock.
Until the Distribution Date (or earlier redemption or expiration), new Common
Stock certificates issued after the Record Date upon transfer or new issuance
of shares of Common Stock will contain a notation incorporating the Rights
Agreement by reference. Until the Distribution Date (or earlier redemption or
expiration of the Rights), the surrender for transfer of any certificates for
shares of Common Stock outstanding as of the Record Date, even without such
notation or a copy of this Summary of Rights being attached thereto, will also
constitute the transfer of the Rights associated with the shares of Common
Stock represented by such certificate. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights (the "Right
Certificates") will be mailed to holders of record of the shares of Common
Stock as of the close of business on the Distribution Date (and to each
initial record holder of certain shares of Common Stock issued after 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 on August 17, 2008 (the "Final Expiration Date"), unless
the Final Expiration Date is extended or unless the Rights are earlier
redeemed or exchanged by the Company, in each case, as described below.
In the event that any person becomes an Acquiring Person (except
pursuant to a tender or exchange offer which is for all outstanding shares of
Common Stock at a price and on terms which
<PAGE>
a majority of certain members of the Board of Directors determines to be
adequate and in the best interests of the Company, its stockholders and other
relevant constituencies, other than such Acquiring Person, its affiliates and
associates (a "Permitted Offer")), each holder of a Right will thereafter have
the right (the "Flip-In Right") to acquire one share of Common Stock for a
purchase price equal to 331/3% of the then current market price.
Notwithstanding the foregoing, all Rights that are, or were, beneficially
owned by an Acquiring Person or any affiliate or associate thereof will be
null and void and not exercisable.
In the event that, at any time following the Distribution Date, (i)
the Company is acquired in a merger or other business combination transaction
in which the holders of all of the outstanding shares of Common Stock
immediately prior to the consummation of the transaction are not the holders
of all of the surviving corporations's voting power, or (ii) more than 50% of
the Company's assets or earning power is sold or transferred, then each holder
of a Right (except Rights which have been previously voided as set forth
above) shall thereafter have the right (the "Flip-Over Right") to receive,
upon exercise and payment of the Purchase Price, shares of Common Stock of the
acquiring company having a value equal to two times the Purchase Price. If a
transaction would otherwise result in a holder's having a Flip-In as well as a
Flip-Over Right, then only the Flip-Over Right will be exercisable; if a
transaction results in a holder's having a Flip-Over Right subsequent to a
transaction resulting in a holder's having a Flip-In Right, a holder will have
Flip-Over Rights only to the extent such holder's Flip-In Rights have not been
exercised.
The Purchase Price payable, and the number of shares of Common Stock
or other securities or property issuable, upon exercise of Rights are subject
to adjustment from time to time to prevent dilution (i) in the event of a
stock dividend on, or a subdivision, combination, or reclassification of the
Common Stock, (ii) upon the grant to holders of shares of Common Stock of
certain rights or warrants to subscribe for or purchase Common Stock at a
price, or securities convertible into shares of Common Stock with a conversion
price, less than the then current market price of the Common Stock, or (iii)
upon the distribution to holders of the shares of Common Stock of evidences of
indebtedness or assets (excluding regular periodic cash dividends paid out of
earnings or retained earnings or dividends payable in shares of Common Stock)
or of subscription rights or warrants (other than those referred to above).
However, no adjustment in the Purchase Price will be required until cumulative
adjustments require an adjustment of at least 1%.
No fractional shares of Common Stock will be issued and in lieu
thereof, an adjustment in cash will be made based on the market price of the
Common Stock on the last trading day prior to the date of exercise.
At any time prior to the time a person becomes an Acquiring Person,
the Board of Directors of the Company may redeem the Rights in whole, but not
in part, at a price of $0.001 per Right (the "Redemption Price"). The
redemption of the Rights may be made effective at such time on such basis and
with such conditions as the Board of Directors in its sole discretion may
establish. Immediately upon any redemption of the Rights, the right to
exercise the Rights will terminate and the only right of the holders of Rights
will be to receive the Redemption Price.
At any time after any person becomes an Acquiring Person and prior to
the acquisition by such person or group of shares of Common Stock representing
50% or more of the then outstanding shares of Common Stock, the Board of
Directors of the Company may exchange the Rights (other
<PAGE>
than Rights which have become null and void), in whole or in part, at an
exchange ratio of one share of Common Stock per Right (subject to adjustment).
All of the provisions of the Rights Agreement may be amended prior to
the Distribution Date by the Board of Directors of the Company for any reason
it deems appropriate. Prior to the Distribution Date, the Board is also
authorized, as it deems appropriate, to lower the thresholds for distribution
and Flip-In Rights to not less than the greater of (i) any percentage greater
than the largest percentage then held by any stockholder (other than certain
exempted parties), or (ii) 10%. After the Distribution Date, the provisions of
the Rights Agreement may be amended by the Board of Directors in order to cure
any ambiguity, defect or inconsistency, to make changes which do not adversely
affect the interests of holders of Rights (excluding the interests of any
Acquiring Person), or, subject to certain limitations, to shorten or lengthen
any time period under the Rights Agreement.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the
right to vote or to receive dividends. While the distribution of the Rights
will not be taxable to stockholders of the Company, stockholders may,
depending upon the circumstances, recognize taxable income should the Rights
become exercisable or upon the occurrence of certain events thereafter.
Notwithstanding anything herein to the contrary, no Right shall
constitute an offer to sell or the solicitation of an offer to buy any
securities, nor shall there by any sale of Rights or the issuance of
securities upon exercise of the Rights in any state in which such offer,
solicitation, or sale would be unlawful prior to registration or qualification
under the securities laws of any such states.
Notwithstanding the foregoing, the Rights shall not be exercisable
under any circumstances unless there shall be at the time of exercise an
effective registration statement under the Securities Act of 1933, as amended,
relating to the issuance of the shares of Common Stock issuable upon the
exercise or exchange of the Rights.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to the Company's Registration Statement on
Form 8-A with respect to the Rights filed with the Securities and Exchange
Commission (Commission File No. ). A copy of the Rights Agreement is available
free of charge from the Company. This summary description of the Rights does
not purport to be complete and is qualified in its entirety by reference to
the Rights Agreement, which is hereby incorporated herein by reference.
