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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 12(G) OF THE
SECURITIES EXCHANGE ACT OF 1934
CHOICEPOINT INC.
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(Exact name of registrant as specified in its charter)
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GEORGIA 58-2309650
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(State of incorporation or organization) (IRS employer
identification no.)
If this form relates to the registration of a If this form relates to the registration of a
class of securities pursuant to Section 12(b) class of securities pursuant to Section 12(g)
of the Exchange Act and is effective pursuant of the Exchange Act and is effective pursuant
to General Instruction A.(c), please check the to General Instruction A.(d), please check the
following box. [X] following box. [ ]
1000 Alderman Drive
Alpharetta, Georgia 30005
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(Address of principal executive offices) (zip code)
</TABLE>
Securities Act registration statement file number to which this form
relates:
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(if applicable)
Securities to be registered pursuant to Section 12(b) of the Act:
Rights to Purchase Common Stock
(Pursuant to Rights Agreement)
-------------------------------
(Title of Class)
Securities to be registered pursuant to Section 12(g) of the Act:
None
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ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED
General
The Board of Directors of ChoicePoint Inc. (the "Company") has
declared a dividend distribution of one right (a "Right") for each outstanding
share of common stock, par value $0.10 per share (the "Common Shares"), of the
Company. The distribution is payable to the shareholders of record as of the
close of business on November 14, 1997 (the "Record Date"). Each Right
entitles the registered holder to purchase from the Company one Common Share at
a price of $180 (the "Purchase Price"), subject to adjustment. The description
and terms of the Rights are set forth in a Rights Agreement, dated as of
October 29, 1997 (the "Rights Agreement"), between the Company and SunTrust
Bank, Atlanta, as Rights Agent (the "Rights Agent").
Copies of the Rights Agreement are 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 specific
provisions of the Rights Agreement, including the definitions therein of
certain terms, which are incorporated herein by reference.
Summary of 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 upon the earliest
of (i) the close of business on the tenth calendar day (or such later date as
may be specified by the Board of Directors) following a public announcement
that a person or group of affiliated or associated persons has acquired, or
obtained the right to acquire, beneficial ownership of 15% or more of the
outstanding Common Shares (an "Acquiring Person"), (ii) the close of business
on the tenth business day following the commencement of a tender offer or
exchange offer by a person or group of affiliated or associated persons, the
consummation of which would result in beneficial ownership by such person or
group of 15% or more of the outstanding Common Shares, or (iii) the close of
business on the tenth calendar day following the first date of public
announcement of the first occurrence of a Flip-in Event or a Flip-over Event
(as such terms are hereinafter defined) (the earliest of such dates being
hereinafter called the "Distribution Date").
Until the Distribution Date, the Rights will be evidenced by
certificates for the Common Stock and will be transferred with and only with
the Common Shares. After the Record Date, all newly-issued Common Stock
certificates will contain a notation incorporating the Rights Agreement by
reference. Until the Distribution Date (or earlier redemption, exchange or
expiration of the Rights), the surrender for transfer of any certificates for
Common Shares in respect of which Rights have been issued will also constitute
the transfer of the Rights associated with the Common Shares represented by
such certificates. As soon as practicable following the Distribution Date,
separate certificates evidencing the Rights (the "Right Certificates") will be
mailed to holders of record of the Common Shares of the close of business on
the Distribution Date and such separate Right Certificates alone will evidence
the Rights.
No Right is exercisable at any time prior to the Distribution Date.
The Rights will expire on October 29, 2007 (the "Final Expiration Date") unless
earlier redeemed or exchanged by the
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Company as described below. Until a Right is exercised, the holder thereof, as
such, will have no rights as a shareholder of the Company, including without
limitation the right to vote or to receive dividends.
The Purchase Price payable, and the number and kind of securities
issuable upon exercise of the Rights and the number of Rights outstanding 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 Shares, (ii) upon the grant to holders of the Common Shares of certain
rights, options or warrants to subscribe for or purchase Common Shares at a
price, or securities convertible into Common Shares with a conversion price
less than the then current market price of the Common Shares or (ii) upon the
distribution to holders of the Common Shares of evidences of indebtedness or
cash (excluding regular periodic cash dividends), assets, stock (excluding
dividends payable in Common Shares) or of subscription rights, options or
warrants (other than those referred to above).
In the event (a "Flip-in Event") that (i) any Acquiring Person merges
into or combines with the Company and the Company is the surviving corporation
or any Acquiring Person effects certain other transactions with the Company, as
described in the Rights Agreement, (ii) during such time as there is an
Acquiring Person, there shall be any reclassification of securities or
recapitalization or reorganization of the Company which has the effect of
increasing by more than 1% the proportionate share of the outstanding shares of
any class of equity securities of the Company or any of its subsidiaries
beneficially owned by the Acquiring Person, or (iii) any person or group of
affiliated or associated persons becomes the beneficial owner of 20% or more of
the outstanding Common Shares, proper provision shall be made so that each
holder of a Right, other than Rights that are or were owned beneficially by the
Acquiring Person (which, from and after the later of the Distribution Date and
the date of the earliest of any such events, will be void), will thereafter
have the right to receive, upon exercise thereof upon payment of the Purchase
Price of the Right, that number of Common Shares (or, under certain
circumstances, an economically equivalent security or securities of the
Company) having a market value of two times the exercise price of the Right.
To illustrate the operation of such an adjustment, at a Purchase Price
of $180.00 assuming the current market price (as determined pursuant to the
provisions of the Rights Agreement) per Common Share were $40.00, each Right
not owned beneficially by an Acquiring Person at or after the time of such an
occurrence would entitle its holder to purchase (after the Distribution Date)
from the Company nine (9) Common Shares (having a market value of $360.00) for
$180.00.
In the event (a "Flip-over Event") that, following the first date of
public announcement that a person has become an Acquiring Person, (i) the
Company consolidates with or merges with or into any person and the Company is
not the surviving corporation, (ii) any person consolidates with or merges with
or into the Company and the Company is the surviving corporation, but its
Common Shares are changed or exchanged, (iii) the Company effects a share
exchange with another person, or (iv) 50% or more of the Company's assets or
earning power, including without limitation securities creating obligations of
the Company, are sold, proper provision shall be made so that each holder of a
Right will thereafter have the right to receive, upon the exercise thereof at
the then current exercise price of the Right, that number of shares of common
stock (or, under certain
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circumstances, an economically equivalent security or securities) of such other
person which at the time of such transaction would have a market value of two
times the exercise price of the Right.
At any time after the later of the Distribution Date and the first
occurrence of a Flip-in Event or Flip-over Event and prior to the acquisition
by any person or group of affiliated or associated persons of 50% or more of
the outstanding Common Shares, the Board of Directors of the Company may
exchange the Rights (other than any Rights which have become void), in whole or
in part, at an exchange ratio of one Common Share per Right (subject to
adjustment).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment in the Purchase
Price of at least 1%. The Company is not required to issue fractional Common
Shares or other securities issuable upon the exercise of Rights. In lieu of
issuing such securities, the Company may males a cash payment, as provided in
the Rights Agreement.
The Company may redeem the Rights in whole, but not in part, at a
price of $0.01 per Right (the "Redemption Price"), at any time prior to the
close of business on the later of (i) the Distribution Date and (ii) the first
date of public announcement that a person has become an Acquiring Person.
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.
The Rights Agreement may be amended by the Company without the
approval of any holders of Right Certificates, including amendments which add
other events requiring adjustment to the purchase price payable and the number
of Common Shares or other securities issuable upon the exercise of the Rights
or which modify procedures relating to the redemption of the Rights, provided
that no amendment may be made at such time as the Rights are not then
redeemable that decreases the stated Redemption Price or the period of time
remaining until the Final Expiration Date or that modifies a time period
relating to when the Rights may be redeemed.
Terms of the Common Stock
The terms of the Company's Common Stock, for which the Rights may be
exercised under certain circumstances as described above, are incorporated
herein by reference to the summary thereof included under the caption
"Description of Capital Stock" in the Company's prospectus included as part of
its Registration Statement on Form S-1 (Reg. No. 333-30297).
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ITEM 2. EXHIBITS
The following exhibits are filed as part of the Registration
Statement:
3.01* Articles of Incorporation, as amended.
3.02* Bylaws, as amended.
4.01* Form of Common Stock certificate.
4.02 Rights Agreement, dated as of October 29, 1997, by and
between ChoicePoint Inc. and SunTrust Bank, Atlanta.
________________
* Incorporated herein by reference to the exhibit of the same number
in the Company's Registration Statement on Form S-1 (Commission
File No. 333-30297), filed June 30, 1997.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the Registrant has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized.
CHOICEPOINT INC.
By: /s/ J. Michael de Janes
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J. Michael de Janes
General Counsel and Assistant Secretary
Dated: November 4, 1997
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EXHIBIT INDEX
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<CAPTION>
Exhibit
No. Description
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<S> <C>
3.01* Articles of Incorporation, as amended.
3.02* Bylaws, as amended.
4.01* Form of Common Stock certificate.
4.02 Rights Agreement, dated as of October 29,1997, by and
between ChoicePoint Inc. and SunTrust Bank, Atlanta.
</TABLE>
________________
* Incorporated herein by reference to the exhibit of the same number
in the Company's Registration Statement on Form S-1 (Commission
File No. 333-30297), filed June 30, 1997.
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EXHIBIT 4.02
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CHOICEPOINT INC.
and
SUNTRUST BANK, ATLANTA
RIGHTS AGREEMENT
Dated as of October 29, 1997
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TABLE OF CONTENTS
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Page
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RECITALS
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Section 1. Certain Definitions............................................................................................1
Section 2. Appointment of Rights Agent....................................................................................7
Section 3. Issue of Right Certificates....................................................................................8
Section 4. Form of Right Certificates.....................................................................................9
Section 5. Countersignature and Registration.............................................................................11
Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen Right Certificates...................................................12
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights.................................................13
Section 8. Cancellation and Destruction of Right Certificates............................................................17
Section 9. Company Covenants Concerning Securities and Rights............................................................17
Section 10. Record Date..................................................................................................20
Section 11. Adjustment of Purchase Price, Number and Kind of Securities or
Number of Rights..........................................................................................20
Section 12. Certificate of Adjusted Purchase Price or Number of Securities...............................................33
</TABLE>
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Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power.........................................33
Section 14. Fractional Rights and Fractional Securities..................................................................37
Section 15. Rights of Action.............................................................................................39
Section 16. Agreement of Rights Holders..................................................................................40
Section 17. Right Certificate Holder Not Deemed a Shareholder............................................................41
Section 18. Concerning the Rights Agent..................................................................................41
Section 19. Merger or Consolidation or Change of Name of Rights Agent....................................................42
Section 20. Duties of Rights Agent.......................................................................................43
Section 21. Change of Rights Agent.......................................................................................46
Section 22. Issuance of New Right Certificates...........................................................................47
Section 23. Redemption...................................................................................................48
Section 24. Notice of Certain Events.....................................................................................50
Section 25. Notices......................................................................................................51
Section 26. Supplements and Amendments...................................................................................52
Section 27. Exchange.....................................................................................................53
Section 28. Successors; Certain Covenants................................................................................55
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Section 29. Benefits of this Agreement...................................................................................55
Section 30. Determinations and Actions by the Board of Directors, etc....................................................55
Section 31. Severability.................................................................................................56
Section 32. Governing Law................................................................................................56
Section 33. Counterparts.................................................................................................56
Section 34. Descriptive Headings.........................................................................................56
Exhibit A Form of Rights Certificate...................................................................A-1
Exhibit B Summary of Rights to Purchase Common Shares..................................................B-1
</TABLE>
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RIGHTS AGREEMENT
This RIGHTS AGREEMENT, dated as of October 29, 1997 (this "Agreement"),
is made and entered into by and between ChoicePoint Inc., a Georgia corporation
(the "Company"), and SunTrust Bank, Atlanta, a Georgia banking corporation (the
"Rights Agent").
RECITALS
WHEREAS, on October 29, 1997, the Board of Directors of the Company
authorized and declared a dividend distribution of one right ("Right") for each
share of Common Stock, par value $0.10 per share, of the Company (a "Common
Share") outstanding as of the Close of Business (as hereinafter defined) on
November 14, 1997 (the "Record Date"), each Right initially representing the
right to purchase one Common Share, upon the terms and subject to the conditions
herein set forth, and further authorized and directed the issuance of one Right
with respect to each Common Share issued or delivered by the Company (whether
originally issued or delivered from the Company's treasury) after the Record
Date but prior to the earlier of the Distribution Date (as hereinafter defined)
and the Expiration Date (as hereinafter defined).
NOW THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this
Agreement, the following terms shall have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (other than the Company or
any Subsidiary of the Company or any employee benefit or stock ownership plan of
the Company or of any Subsidiary of the Company or any entity holding Common
Shares for or pursuant to the terms of any such plan) who or which, together
with all Affiliates and Associates of such Person, shall be the Beneficial Owner
of 15% or more of the Common Shares then outstanding; provided, however, that a
Person shall not be deemed to have become an Acquiring Person solely as a result
of a reduction in the number of Common Shares
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outstanding unless and until such time as (i) such Person or any Affiliate or
Associate of such Person shall thereafter become the Beneficial Owner of any
additional Common Shares, other than as a result of a stock dividend, stock
split or similar transaction effected by the Company in which all holders of
Common Shares are treated equally, or (ii) any other Person who is the
Beneficial Owner of any Common Shares shall thereafter become an Affiliate or
Associate of such Person.
(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, as in effect on the date of this Agreement.
(c) A Person shall be deemed the Beneficial Owner of, and to
"beneficially own," any securities:
(i) which such Person or any of such Person's Affiliates
or Associates, directly or indirectly, has the right to acquire
(whether such right is exercisable immediately or only after the
passage of time) pursuant to any agreement, arrangement or
understanding (whether or not in writing), or upon the exercise of
conversion rights, exchange rights, rights, warrants or options, or
otherwise (in each case, other than upon exercise or exchange of the
Rights); 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
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(ii) which such Person or any of such Person's Affiliates
or Associates, directly or indirectly, has the right to vote or dispose
of, including pursuant to any agreement, arrangement or understanding
(whether or not in writing); or
(iii) of which any other Person is the Beneficial Owner, if
such Person or any of such Person's Affiliates or Associates has any
agreement, arrangement or understanding (whether or not in writing)
with such other Person (or any of such other Person's Affiliates or
Associates) with respect to acquiring, holding, voting or disposing of
any securities of the Company;
provided, however, that a Person shall not be deemed the Beneficial Owner of, or
to beneficially own, any security (A) if such Person has the right to vote such
security pursuant to an agreement, arrangement or understanding (whether or not
in writing) which (1) arises solely from a revocable proxy given to such Person
in response to a public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations of the Exchange Act and
(2) is not also then reportable on Schedule 13D under the Exchange Act (or any
comparable or successor report), or (B) if such beneficial ownership arises
solely as a result of such Person's status as a "clearing agency", as defined in
Section 3(a)(23) of the Exchange Act; and provided, further, that nothing in
this paragraph (c) shall cause a Person engaged in business as an underwriter of
securities to be the Beneficial Owner of, or to beneficially own, any securities
acquired through such Person's participation in good faith in an underwriting
syndicate until the expiration of 40 calendar days after the date of such
acquisition, or such later date as the Board of Directors of the Company may
determine in any specific case.
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(d) "Business Day" shall mean any day other than a Saturday,
Sunday or a day on which banking institutions in the State of Georgia (or such
other state in which the principal office of the Rights Agent is located) are
authorized or obligated by law or executive order to close.
(e) "Close of Business" on any given date shall mean 5:00 P.M.,
Eastern time, on such date; provided, however, that if such date is not a
Business Day it shall mean 5:00 P.M., Eastern time, on the next succeeding
Business Day.
(f) "Common Shares" when used with reference to the Company shall
mean the Common Stock, par value $.10 per share, of the Company; provided,
however, that, if the Company is the continuing or surviving corporation in a
transaction described in Section 11(a)(ii) or Section 13(a)(ii) hereof, "Common
Shares" when used with reference to the Company shall mean the capital stock or
equity security with the greatest aggregate voting power of the Company. Common
Shares when used with reference to any corporation or other legal entity, other
than the Company, including an Issuer, shall mean the capital stock or equity
security with the greatest aggregate voting power of such corporation or other
legal entity.
(g) "Company" shall mean ChoicePoint Inc., a Georgia corporation.
(h) "Distribution Date" shall mean the earliest of: (i) the Close
of Business on the tenth calendar day (or, unless the Distribution Date shall
have previously occurred, such later date as may be specified by the Board of
Directors of the Company) after the Share Acquisition Date, (ii) the Close of
Business on the tenth Business Day (or, unless the Distribution Date shall have
previously occurred, such later date as may be specified by the Board of
Directors of the Company) after the date of the commencement of a tender or
exchange offer by any Person (other than the Company or any Subsidiary of
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the Company or any employee benefit or stock ownership plan of the Company or of
any Subsidiary of the Company or any entity holding Common Shares for or
pursuant to the terms of any such plan), if upon the consummation thereof such
Person would be the Beneficial Owner of 15% or more of the outstanding Common
Shares, and (iii) the Close of Business on the tenth calendar day after the
first date of public announcement by the Company or an Acquiring Person (by
press release, filing made with the Securities and Exchange Commission or
otherwise) of the first occurrence of a Triggering Event; provided, however,
that if the earliest of such dates would otherwise occur prior to the Record
Date, the Distribution Date shall mean the Close of Business on the Record Date.
(i) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
(j) "Expiration Date" shall mean the earliest of (i) the Close of
Business on the Final Expiration Date, (ii) the time at which the Rights are
redeemed as provided in Section 23 hereof, and (iii) the time at which all
exercisable Rights are exchanged as provided in Section 27 hereof.
(k) "Final Expiration Date" shall mean the tenth anniversary of
the Record Date.
(l) "Flip-in Event" shall mean any event described in clauses (A)
(B) or (C) of Section 11(a)(ii) hereof.
(m) "Flip-over Event" shall mean any event described in
subsections (i), (ii), (iii) or (iv) of Section 13(a) hereof.
(n) "Issuer" shall have the meaning set forth in Section 13(b)
hereof.
(o) "NASDAQ" shall mean the National Association of Securities
Dealers, Inc. Automated Quotation System.
(p) "NYSE" shall mean the New York Stock Exchange, Inc.
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(q) "Person" shall mean any individual, firm, corporation,
partnership or other legal entity, and shall include any successor (by merger
or otherwise) of such entity.
(r) "Purchase Price" shall mean initially $180 per Common Share,
and shall be subject to further adjustment from time to time as provided in this
Agreement.
(s) "Redemption Price" shall mean $0.01 per Right, subject to
adjustment by resolution of the Board of Directors of the Company to reflect any
stock split, stock dividend or similar transaction occurring after the date
hereof.
(t) "Right" shall have the meaning set forth in the Recitals to
this Agreement.
(u) "Right Certificates" shall mean certificates evidencing the
Rights, in substantially the form of Exhibit A attached hereto.
(v) "Rights Agent" shall mean SunTrust Bank, Atlanta, unless and
until a successor Rights Agent shall have become such pursuant to the terms of
this Agreement, and thereafter, "Rights Agent" shall mean such successor Rights
Agent.
(w) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(x) "Share Acquisition Date" shall mean the first date of public
announcement by the Company or an Acquiring Person (by press release, filing
made with the Securities and Exchange Commission or otherwise) that an Acquiring
Person has become such.
(y) "Subsidiary" when used with reference to any Person shall
mean any corporation or other legal entity of which a majority of the voting
power of the voting equity securities or equity interests is owned, directly or
indirectly, by such Person; provided, however, that for purposes of Section
13(b) hereof, Subsidiary when used with reference to any Person shall mean any
corporation or other legal entity of
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which at least 20% of the voting power of the voting equity securities or equity
interests is owned, directly or indirectly, by such Person.
(z) "Summary of Rights" shall mean the Summary of Rights to
Purchase Common Shares, in substantially the form of Exhibit B attached hereto.
(aa) "Trading Day" shall mean any day on which the principal
national securities exchange on which the Common Shares are listed or admitted
to trading is open for the transaction of business or, if the Common Shares are
not listed or admitted to trading on any national securities exchange, a
Business Day.
(bb) "Triggering Event" shall mean any Flip-in Event or Flip-over
Event.
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 also be, prior to the
Distribution Date, the holders of the Common Shares) in accordance with the
terms and conditions hereof, and the Rights Agent hereby accepts such
appointment and hereby certifies that it complies with the requirements of the
NYSE governing transfer agents and registrars. The Company may from time to time
act as Co-Rights Agent or appoint such Co-Rights Agents as it may deem necessary
or desirable. Any actions which may be taken by the Rights Agent pursuant to the
terms of this Agreement may be taken by any such Co-Rights Agent. To the extent
that any Co-Rights Agent takes any action pursuant to this Agreement, such
Co-Rights Agent shall be entitled to all of the rights and protections of and
subject to all of the applicable duties and obligations imposed upon, the Rights
Agent pursuant to the terms of this Agreement.
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Section 3. Issue of Right Certificates.
(a) Until the Distribution Date, (i) the Rights shall be evidence
by the certificates representing Common Shares registered in the names of the
record holders thereof (which certificates representing Common Shares shall also
be deemed to be Right Certificates), together with a copy of the Summary of
Rights, (ii) the Rights shall be transferable only in connection with the
transfer of the underlying Common Shares, and (iii) the surrender for transfer
of any certificates evidencing Common Shares in respect of which Rights have
been issued, with or without a copy of the Summary of Rights, shall also
constitute the transfer of the Rights associated with the Common Shares
evidenced by such certificates.
(b) As promptly as practicable after the Record Date, the Company
shall send a copy of the Summary of Rights by first-class, postage prepaid mail,
to each record holder of Common Shares as of the close of business on the Record
Date, at the address of such holder shown on the records of the Company as of
such date.
(c) Rights shall be issued by the Company in respect of all Common
Shares (other than Common Shares issued upon the exercise or exchange of any
Right) issued or delivered by the Company (whether originally issued or
delivered from the Company's treasury) after the Record Date but prior to the
earlier of the Distribution Date and the Expiration Date. Certificates
evidencing such Common Shares shall have stamped on, impressed on, printed on,
written on or otherwise affixed to them the following legend or such similar
legend as the Company may deem appropriate and as is not inconsistent with the
provisions of this Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with any
rule or regulation of any stock exchange or transaction
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reporting system on which the Common Shares may from time to time be listed or
quoted, or to conform to usage:
This Certificate also evidences and entitles the holder hereof
to certain Rights as set forth in a Rights Agreement between
ChoicePoint Inc. and SunTrust Bank, Atlanta, dated as of October 29,
1997 (the "Rights Agreement"), the terms of which are hereby
incorporated herein by reference and a copy of which is on file at the
principal executive offices of ChoicePoint Inc. Under certain
circumstances, as set forth in the Rights Agreement, such Rights may be
redeemed, may expire, may be amended or may be evidenced by separate
certificates and no longer be evidenced by this Certificate.
ChoicePoint Inc. will mail to the holder of this Certificate a copy of
the Rights Agreement without charge promptly after receipt of a written
request therefor. Under certain circumstances as set forth in the
Rights Agreement, Rights beneficially owned by an Acquiring Person or
any Affiliate or Associate of an Acquiring Person (as such terms are
defined in the Rights Agreement) may become null and void.
(d) As promptly as practicable after the Distribution Date, the
Company shall prepare and execute, the Rights Agent will countersign and the
Company shall send or cause to be sent (and the Rights Agent shall, if
requested, send), by first-class, insured, postage prepaid mail, to each record
holder of Common Shares as of the Close of Business on the Distribution Date, at
the address of such holder shown on the records of the Company, a Right
Certificate, evidencing one Right for each Common Share so held, subject to
adjustment. As of and after the Distribution Date, the Rights shall be evidenced
solely by such Right Certificates.
Section 4. Form of Right Certificates. (a) The Right
Certificates (and the form of election to purchase and form of assignment to be
printed on the reverse thereof) shall be substantially in the form set forth as
Exhibit A hereto with such changes, marks of identification or designation and
such legends, summaries or endorsements printed thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock
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exchange or transaction reporting system on which the Rights may from time to
time be listed or quoted, or to conform to usage. Subject to the provisions of
Section 22 hereof, the Right Certificates, whenever issued, on their face shall
entitle the holders thereof to purchase such number of Common Shares as shall be
set forth therein at the Purchase Price set forth therein, but the Purchase
Price, the number and kind of securities issuable upon exercise of each Right
and the number of Rights outstanding shall be subject to adjustment as provided
herein.
(b) Any Rights Certificate issued hereunder that represents Rights
beneficially owned by (i) an Acquiring Person or any Associate or Affiliate of
an Acquiring Person, (ii) a transferee of an Acquiring Person (or an any such
Associate or Affiliate) who becomes a transferee after the Acquiring Person
becomes such, or (iii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the Acquiring Person to
holders of equity interests in such Acquiring Person or to any Person with whom
such Acquiring Person has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (b) a transfer that the Board of Directors
of the Company has determined is part of a plan, arrangement or understanding
that has the primary purpose or effect the avoidance of Section 7(d) hereof, and
any Right Certificate issued pursuant to Section 6 or Section 11 hereof upon
transfer, exchange, replacement or adjustment of any other Right Certificate
referred to in this sentence, shall contain (to the extent feasible) the
following legend:
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The Rights represented by this Right Certificate are
or were beneficially owned by 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 may become null and void in the circumstances specified
in Section 7(d) of such Agreement.
Section 5. Countersignature and Registration.
(a) The Right Certificates shall be executed on behalf of the
Company by its Chairman of the Board, President or any Vice President, either
manually or by facsimile signature, and shall have affixed thereto the Company's
seal or a facsimile thereof which shall be attested by the Secretary or an
Assistant Secretary of the Company, either manually or by facsimile signature.
The Right Certificates shall be manually countersigned by the Rights Agent and
shall not be valid for any purpose unless so countersigned. In case any officer
of the Company who shall have signed any of the Right Certificates shall cease
to be such officer of the Company before countersignature by the Rights Agent
and issuance and delivery by the Company, such Right Certificates, nevertheless,
may be countersigned by the Rights Agent, and issued and delivered by the
Company with the same force and effect as though the person who signed such
Right Certificates had not ceased to be such officer of the Company; and any
Right Certificate may be signed on behalf of the Company by any person who, at
the actual date of the execution of such Right Certificate, shall be a proper
officer of the Company to sign such Right Certificate, although at the date of
the execution of this Rights Agreement any such person was not such an officer.
(b) Following the Distribution Date, the Rights Agent shall keep
or cause to be kept, at the principal office of the Rights Agent designated for
such purpose and at such other offices as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with any
rule or regulation of any stock exchange or any transaction reporting system on
which the Rights may
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from time to time be listed or quoted, books for registration and transfer of
the Right Certificates issued hereunder. Such books shall show the names and
addresses of the respective holders of the Right Certificates, the number of
Rights evidenced on its face by each of the Right Certificates and the date of
each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of
Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
(a) Subject to the provisions of Sections 7(d) and 14 hereof, at
any time after the Close of Business on the Distribution Date and prior to the
Expiration Date, any Right Certificate or Right Certificates representing
exercisable Rights may be transferred, split up, combined or exchanged for
another Right Certificate or Right Certificates, entitling the registered holder
to purchase a like number of Common Shares (or other securities, as the case may
be) as the Right Certificate or Right Certificates surrendered then entitled
such holder (or former holder in the case of a transfer) to purchase. Any
registered holder desiring to transfer, split up, combine or exchange 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 of the
Rights Agent designated for such purpose. Thereupon or as promptly as
practicable thereafter, subject to the provisions of Sections 7(d) and 14
hereof, the Company shall prepare, execute and deliver to the Rights Agent, and
the Rights Agent shall countersign and deliver 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.
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(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation of
a Right Certificate, and, in any such event, of indemnity or security reasonably
satisfactory to them, and reimbursement to the Company and the Rights Agent of
all reasonable expenses incidental thereto, and upon surrender to the Rights
Agent and cancellation of the Right Certificate if mutilated, the Company shall
prepare, execute and deliver a new Right Certificate of like tenor to the Rights
Agent and the Rights Agent shall countersign and deliver such new Right
Certificate 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) The registered holder of any Right Certificate may exercise
the Rights evidenced thereby (except as otherwise provided herein) in whole or
in part at any time after the Distribution Date and prior to the Expiration
Date, upon surrender of the Right Certificate, with the form of election to
purchase on the reverse side thereof duly executed, to the Rights Agent at the
office or offices of the Rights Agent designated for such purpose, together with
payment in cash, in lawful money of the United States of America by certified
check or bank draft payable to the order of the Company equal to the sum of (i)
the aggregate Purchase Price for the total number of securities as to which such
surrendered Rights are exercised and (ii) an amount equal to any applicable
transfer tax required to be paid by the holder of such Right Certificate in
accordance with the provisions of Section 9 hereof. In lieu of the cash payment
referred to in the immediately preceding sentence, following the occurrence of a
Triggering Event, the registered holder of a Right Certificate may exercise the
Rights evidenced thereby (except as otherwise provided herein) in whole or in
part upon surrender of the Right Certificate as described above together with an
election to exercise such Rights without payment of cash on the reverse side
thereof duly
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completed. With respect to any Rights as to which such an election is made, the
holder shall receive a number of Common Shares or other securities having a
value equal to the difference between (x) the value of the Common Shares or
other securities that would have been issuable upon payment of the cash amount
as described above, and (y) the sum of items (i) and (ii) above. For purposes of
this Section 7(a), the value of any Common Share or other security shall be the
current per share market price of a Common Share (determined pursuant to Section
11(d) hereof) on the Trading Day immediately preceding the date of the first
occurrence of a Triggering Event.
(b) Upon receipt of a Right Certificate representing exercisable
Rights with the form of election to purchase duly executed, accompanied by
either payment as described in Section 7(a) above or a duly completed election
to exercise without payment of cash, the Rights Agent shall promptly (i)
requisition from any transfer agent of the Common Shares (or make available, if
the Rights Agent is the transfer agent) certificates representing the number of
Common Shares to be purchased (and the Company hereby irrevocably authorizes and
directs its transfer agent to comply with all such requests), (ii) 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, (iii) when appropriate, requisition from the
Company or any transfer agent therefor (or make available, if the Rights Agent
is the transfer agent) certificates representing the number of equivalent common
shares to be issued in lieu of the issuance of Common Shares in accordance with
the provisions of Section 11(a)(iii) hereof, (iv) when appropriate, 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, (v) when appropriate,
requisition from the Company the amount of cash to be paid in lieu of the
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issuance of fractional shares in accordance with the provisions of Section 14
hereof or in lieu of the issuance of Common Shares in accordance with the
provisions of Section 11(a)(iii) hereof, (vi) when appropriate, after receipt,
deliver such cash to or upon the order of the registered holder of such Right
Certificate, and (vii) when appropriate, deliver any due bill or other
instrument provided to the Rights Agent by the Company for delivery to the
registered holder of such Right Certificate as provided by Section 11(1) hereof.
(c) In case the registered holder of any Right Certificate shall
exercise less than all the Rights evidenced thereby, the Company shall prepare,
execute and deliver a new Right Certificate evidencing Rights equivalent to the
Rights remaining unexercised and the Rights Agent shall countersign and deliver
such new Right Certificate to the registered holder of such Right Certificate or
to his duly authorized assigns, subject to the provisions of Section 14 hereof.
(d) Notwithstanding anything in this Agreement to the contrary,
from and after the later of the Distribution Date and the first occurrence of a
Triggering Event, any Rights beneficially owned by (i) an Acquiring Person or an
Associate or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring
Person (or of any such Associate or Affiliate) who becomes a transferee after
the Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person
(or of any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such rights
pursuant to either (A) a transfer (whether or not for consideration) from the
Acquiring Person to holders of equity interests in such Acquiring Person or to
any Person with whom the Acquiring Person has any continuing agreement,
arrangement or understanding regarding the transfer of Rights, or (B) a transfer
that the Board of Directors of the Company has determined is part of a plan,
arrangement or
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understanding that has as a primary purpose or effect the avoidance of this
Section 7(d), shall become null and void without any further action, no holder
of such Rights shall have any rights whatsoever with respect to such Rights,
whether under any provision of this Agreement or otherwise, and any Right
Certificate delivered to the Rights Agent for transfer to an Acquiring Person or
any Affiliate or Associate thereof shall be cancelled. The Company shall use all
reasonable efforts to ensure that the provisions of this Section 7(d) and
Section 4(b) hereof are complied with, but shall have no liability to any holder
of Rights Certificates or other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or its Affiliates, Associates
or transferees hereunder.
(e) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to any purported transfer, split up, combination or exchange
of any Right Certificate pursuant to Section 6 hereof or exercise of a Right
Certificate as set forth in this Section 7 unless the registered holder of such
Right Certificate shall have (i) completed and signed the certificate following
the form of assignment or form of election to purchase, as applicable, set forth
on the reverse side of the Right Certificate for such transfer, split up,
combination, exchange or exercise, and (ii) provided such additional evidence of
the identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates
or Associates thereof as the Company shall have reasonably requested.
Section 8. Cancellation and Destruction of Right Certificates.
All Right Certificates surrendered for the purpose of exercise, transfer, split
up, combination or exchange shall, if surrendered to the Company or to any of
its stock transfer agents, be delivered to the Rights Agent for cancellation or
in cancelled form, or, if surrendered to the Rights Agent, shall be cancelled by
it, and no Right Certificates
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shall be issued in lieu thereof except as expressly permitted by this Agreement.
The Company shall deliver to the Rights Agent for cancellation and retirement,
and the Rights Agent shall so cancel and retire, any other Right Certificate
purchased or acquired by the Company otherwise than upon the exercise thereof.
The Rights Agent shall deliver all cancelled Right Certificates to the Company,
or shall, at the written request of the Company, destroy such cancelled Right
Certificates, and in such case shall deliver a certificate of destruction
thereof to the Company.
Section 9. Company Covenants Concerning Securities and Rights.
The Company covenants and agrees that:
(a) So long as the Common Shares issuable upon the exercise of
the Rights may be listed on a national securities exchange, it shall endeavor
to cause, from and after such time as the Rights become exercisable, all
securities reserved for issuance upon the exercise of Rights to be listed on
such exchange upon official notice of issuance.
(b) It shall take all such action as may be necessary to ensure
that all Common Shares and/or other securities delivered upon exercise of
Rights, at the time of delivery of the certificates for such securities shall be
(subject to payment of the Purchase Price) duly and validly authorized and
issued, fully paid and nonassessable securities.
(c) It shall pay when due and payable any and all federal and
state transfer taxes and charges that may be payable in respect of the issuance
or delivery of the Right Certificates and of any certificates representing
securities issued upon the exercise of Rights; provided, however, that the
Company shall not be required to pay any transfer tax or charge which may be
payable in respect of any transfer or delivery of Right Certificates to a person
other than, or the issuance or delivery of certificates representing securities
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issued upon the exercise of Rights in a name other than that of, the registered
holder of the Right Certificate evidencing Rights surrendered for exercise, or
to issue or deliver any certificates representing securities issued upon the
exercise of any Rights until any such tax or charge shall have been paid (any
such tax or charge being payable by the holder of such Right Certificate at the
time of surrender) or until it has been established to the Company's reasonable
satisfaction that no such tax is due.
(d) It shall use its best efforts (i) to file on an appropriate
form, as soon as practicable following the later of the first occurrence of a
Triggering Event or the Distribution Date, a registration statement under the
Securities Act with respect to the securities issuable upon exercise of the
Rights, (ii) to cause such registration statement to become effective as soon as
practicable after such filing, and (iii) to cause such registration statement to
remain effective (with a prospectus at all times meeting the requirements of the
Act) until the earlier of (A) the date as of which the Rights are no longer
exercisable for such securities and (B) the Expiration Date. The Company shall
also take such action as may be appropriate under, or to ensure compliance with,
the securities or "blue sky" laws of the various states in connection with the
exercisability of the Rights. The Company may temporarily suspend, for a period
of time after the date set forth in clause (i) of the first sentence of this
Section 9(d), the exercisability of the Rights in order to prepare and file such
registration statement and to permit it to become effective. Upon any such
suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as well as a public
announcement at such time as the suspension is no longer in effect. In addition,
if the Company shall determine that a registration statement should be filed
under the Securities Act or any state securities laws following the Distribution
Date, the Company may temporarily suspend the exercisability of the Rights in
each relevant jurisdiction until such time as a registration
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statement has been declared effective and, upon any such suspension, the Company
shall issue a public announcement stating that the exercisability of the Rights
has been temporarily suspended, as well as a public announcement at such time as
the suspension is no longer in effect. Notwithstanding anything in this
Agreement to the contrary, the Rights shall not be exercisable in any
jurisdiction if the requisite registration or qualification in such jurisdiction
shall not have been effected or the exercise of the Rights shall not be
permitted under applicable law.
(e) Notwithstanding anything in this Agreement to the contrary,
after the Distribution Date it shall not, except as permitted by Section 23, 26
or 27 hereof, take (or permit any Subsidiary to take) any action if at the time
such action is taken it is reasonably foreseeable that such action will
eliminate or otherwise diminish the benefits intended to be afforded by the
Rights.
(f) In the event that the Company is obligated to issue other
securities of the Company and/or pay cash pursuant to Section 11, 13 or 14
hereof, it shall make all arrangements necessary so that such other securities
and/or cash are available for distribution by the Rights Agent, if and when
appropriate.
Section 10. Record Date. Each Person in whose name any
certificate representing Common Shares is issued upon the exercise of Rights
shall for all purposes be deemed to have become the holder of record of the
Common Shares 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 all applicable transfer
taxes) was made; provided, however, that if the date of such surrender and
payment is a date upon which the Common Shares transfer books of the Company are
closed, such Person shall be deemed to have become the record holder of such
securities on, and such certificate shall be dated, the next succeeding Business
Day on which the Common Shares transfer books of the Company are open.
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Prior to the exercise of the Rights evidenced thereby, the holder of a Right
Certificate shall not be entitled to any rights of a shareholder of the Company
with respect to securities for which the Rights shall be exercisable, including,
without limitation, the right to vote, 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
Securities or Number of Rights. The Purchase Price, the number and kind of
securities issuable upon exercise of each Right and the number of Rights
outstanding are subject to adjustment from time to time as provided in this
Section 11.
(a) (i) In the event that the Company shall at any time after the
date of this Agreement (A) effect a dividend on the Common Shares payable in
Common Shares, (B) subdivide the outstanding Common Shares, (C) combine the
outstanding Common Shares into a smaller number of shares or (D) issue any
shares of its capital stock in a reclassification of the Common Shares
(including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing or surviving corporation), the
Purchase Price in effect at the time of the record date for such dividend or on
the effective date of such subdivision, combination or reclassification, and/or
the number and/or kind of shares of capital stock issuable on such date upon
exercise of a Right, shall be proportionately adjusted so that the holder of any
Right exercised after such time shall be entitled to receive upon payment of the
Purchase Price then in effect the aggregate number and kind of shares of capital
stock which, if such Right had been exercised immediately prior to such date and
at a time when the Common Shares transfer books of the Company were open, the
holder of such Right would have owned upon such exercise and been entitled to
receive by virtue of such dividend, subdivision, combination or
reclassification. If an event
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occurs which would require an adjustment under both this Section 11(a)(i) and
Section 11(a)(ii) hereof or Section 13 hereof, the adjustment provided for in
this Section 11(a)(i) shall be in addition to, and shall be made prior to, any
adjustment required pursuant to Section 11(a)(ii) or Section 13 hereof.
(ii) Subject to the provisions of Section 23 or 27
hereof, in the event that:
(A) any Acquiring Person or any Affiliate or
Associate of any Acquiring Person, at any time after the date
of this Agreement, directly or indirectly, shall (1) merge
into the Company or otherwise combine with the Company and the
Company shall be the continuing or surviving corporation of
such merger or combination (other than in a transaction
subject to Section 13 hereof), (2) merge or otherwise combine
with any Subsidiary of the Company, (3) in one or more
transactions (other than in connection with the exercise or
exchange of Rights or the exercise or conversion of securities
exercisable for or convertible into shares of any class of
capital stock of the Company or any of its Subsidiaries)
transfer any assets to the Company or any of its Subsidiaries
in exchange (in whole or in part) for shares of any class of
capital stock of the Company or any of its Subsidiaries or for
securities exercisable for or convertible into shares of any
class of capital stock of the Company or any of its
Subsidiaries, or otherwise obtain from the Company or any of
its Subsidiaries, with or without consideration, any
additional shares of any class of capital stock of the Company
or any of its Subsidiaries or securities exercisable for or
convertible into shares of any class of capital stock of the
Company or any of its Subsidiaries (other than as part of a
pro rata distribution to all holders of such shares of any
class of capital stock of the Company, or any of its
Subsidiaries), (4) sell, purchase, lease,
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exchange, mortgage, pledge, transfer or otherwise dispose (in
one or more transactions), to, from, with or of, as the case
may be, the Company or any of its Subsidiaries (other than in
a transaction subject to Section 13 hereof ), assets,
including securities, on terms and conditions less favorable
to the Company than the Company would be able to obtain in
arm's-length negotiation with an unaffiliated third party, (5)
receive any compensation from the Company or any of its
Subsidiaries other than compensation as a director or for
full-time employment as a regular employee, in either case, at
rates in accordance with the Company's (or its Subsidiaries')
past practices, or (6) receive the benefit, directly or
indirectly (except proportionately as a shareholder), of any
loans, advances, guarantees, pledges or other financial
assistance or any tax credits or other tax advantage provided
by the Company or any of its Subsidiaries; or
(B) during such time as there is an Acquiring
Person, there shall be any reclassification of securities
(including any reverse stock split), or recapitalization of
the Company, or any merger or consolidation of the Company
with any of its Subsidiaries or any other transaction or
series of transactions involving the Company or any of its
Subsidiaries (whether or not with or into or otherwise
involving an Acquiring Person), other than a transaction
subject to Section 13 hereof, which has the effect, directly
or indirectly, of increasing by more than 1% the proportionate
share of the outstanding shares of any class of equity
securities or of securities exercisable for or convertible
into equity securities of the Company or any of its
Subsidiaries of which an Acquiring Person or any Affiliate or
Associate of any Acquiring Person, is the Beneficial Owner; or
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(C) any Person (other than the Company or any
Subsidiary of the Company or any employee benefit or stock
ownership plan of the Company or of any Subsidiary of the
Company or any entity holding Common Shares for or pursuant to
the terms of any such plan) who or which, together with all
Affiliates and Associates of such Person, shall at any time
after date of this Agreement, become the Beneficial Owner of
20% or more of the Common Shares then outstanding (other than
pursuant to any transaction set forth in Section 13(a)
hereof); provided, however, that a Person shall not be deemed
to have become the Beneficial Owner of 20% or more of the
Common Shares then outstanding for the purposes of this
Section 11(a)(ii)(C) solely as a result of a reduction in the
number of Common Shares outstanding unless and until such time
as (1) such Person or any Affiliate or Associate of such
Person shall thereafter become the Beneficial Owner of any
additional Common Shares other than as a result of a stock
dividend, stock split or similar transaction effected by the
Company in which all holders of Common Shares are treated
equally, or (2) any other Person who is the Beneficial Owner
of any Common Shares shall thereafter become an Affiliate or
Associate of such Person;
then, and in each such case, proper provision shall
be made so that each holder of a Right, except as provided
below, shall thereafter have a right to receive, upon exercise
thereof in accordance with the terms of this Agreement at an
exercise price per Right equal to the product of the
then-current Purchase Price multiplied by the number of Common
Shares for which a Right was exercisable immediately prior to
the first occurrence of a Triggering Event, such number of
Common Shares as shall equal the result obtained by (x)
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multiplying the then-current Purchase Price by the number of
Common Shares for which a Right was exercisable immediately
prior to the first occurrence of a Triggering Event, and
dividing that product by (y) 50% of the current per share
market price of the Common Shares (determined pursuant to
Section 11(d) hereof) on the date of the first occurrence of a
Triggering Event.
(iii) Upon the occurrence of the Distribution Date or a
Flip-in Event, if there shall not be sufficient Common Shares
authorized but unissued or issued but not outstanding to permit the
issuance of all the Common Shares issuable in accordance with the
provisions hereof upon the exercise of a Right, the Board of Directors
of the Company shall use its best efforts promptly to authorize and,
subject to the provisions of Section 9(d) hereof, make available for
issuance additional Common Shares or other equity securities of the
Company having equivalent voting rights and an equivalent value (as
determined in good faith by the Board of Directors of the Company) to
the Common Shares (for purposes of this Section 11(a)(iii), "equivalent
common shares"). In the event that equivalent common shares are so
authorized, upon the exercise of a Right in accordance with the
provisions of Section 7 hereof, the registered holder shall be entitled
to receive (A) Common Shares, to the extent any are available and (B) a
number of equivalent common shares, which the Board of Directors of the
Company shall have determined in good faith to have a value equivalent
to the excess of (x) the aggregate current per share market value of
all the Common Shares issuable in accordance with subsection (ii)
hereof upon the exercise of a Right (the "Exercise Value") over (y) the
aggregate current per share market value of any Common Shares available
for issuance upon the exercise of such Right; provided, however, that
if at any time after
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90 calendar days after the first occurrence of a Flip-in Event, there
shall not be sufficient Common Shares and/or equivalent common shares
available for issuance upon the exercise of a Right, then the Company
shall be obligated to deliver, upon the surrender of such Right and
without requiring payment of the Purchase Price, Common Shares (to the
extent available), equivalent common shares (to the extent available)
and then cash (to the extent permitted by applicable law and any
agreements or instruments to which the Company is a party in effect
immediately prior to the first occurrence of any Flip-in Event), which
securities and cash shall have an aggregate value equal to the excess
of (1) the Exercise Value over (2) the product of the then-current
Purchase Price multiplied by the number of Common Shares for which a
Right was exercisable immediately prior to the first occurrence of a
Triggering Event. To the extent that any legal or contractual
restrictions prevent the Company from paying the full amount of cash
payable in accordance with the foregoing sentence, the Company shall
pay to holders of the Rights as to which such payments are being made
all amounts which are not then restricted on a pro rata basis and shall
continue to make payments on a pro rata basis as funds become available
until the full amount due to each such Rights holder has been paid.
(b) In the event that the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of Common Shares
entitling them (for a period expiring within 45 calendar days after such record
date) to subscribe for or purchase Common Shares (or securities having
equivalent rights, privileges and preferences as the Common Shares (for purposes
of this Section 11(b), "equivalent common shares")) or securities convertible
into Common Shares or equivalent common shares at a price per Common Share or
equivalent common share (or having a conversion price per share, if a security
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convertible into Common Shares or equivalent common shares) less than the
current per share market price of the Common Shares (determined pursuant to
Section 11(d) hereof) on such record date, the Purchase Price to be in effect
after such record date shall be determined by multiplying the Purchase Price in
effect immediately prior to such record date by a fraction, the numerator of
which shall be the number of Common Shares outstanding on such record date plus
the number of Common Shares which the aggregate offering price of the total
number of Common Shares and/or equivalent common shares so to be offered (and/or
the aggregate initial conversion price of the convertible securities so to be
offered) would purchase at such current per share market price and the
denominator of which shall be the number of Common Shares outstanding on such
record date plus the number of additional Common Shares and/or equivalent common
shares to be offered for subscription or purchase (or into which the convertible
securities so to be offered are initially convertible). In case such
subscription price may be paid in a consideration part or all of which shall be
in a form other than cash, the value of such consideration shall be as
determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent.
Common Shares owned by or held for the account of the Company shall not be
deemed outstanding for the purpose of any such computation. Such adjustment
shall be made successively whenever such a record date is fixed; and in the
event that such rights, options or warrants are not so issued, the Purchase
Price shall be adjusted to be the Purchase Price which would then be in effect
if such record date had not been fixed.
(c) In the event that the Company shall fix a record date for the
making of a distribution to all holders of Common Shares (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation) of evidences of
indebtedness,
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cash (other than a regular periodic cash dividend), assets, stock (other than a
dividend payable in Common Shares) or subscription rights, options or warrants
(excluding those referred to in Section 11(b) hereof), the Purchase Price to be
in effect after such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a fraction, the
numerator of which shall be the current per share market price of the Common
Shares (as determined pursuant to Section 11(d) hereof) on such record date or,
if earlier, the date on which Common Shares begin to trade on an ex-dividend or
when-issued basis for such distribution, less the fair market value (as
determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent) of
the portion of the evidences of indebtedness, cash, assets or stock so to be
distributed or of such subscription rights, options or warrants applicable to
one Common Share, and the denominator of which shall be such current per share
market price of the Common Shares. Such adjustments shall be made successively
whenever such a record date is fixed; and in the event that such distribution is
not so made, the Purchase Price shall again be adjusted to be the Purchase Price
which would then be in effect if such record date had not been fixed.
(d) For the purpose of any computation hereunder, the "current per
share market price" of Common Shares on any date shall be deemed to be the
average of the daily closing prices per share of such Common Shares for the 30
consecutive Trading Days immediately prior to such date; provided, however, that
in the event that the current per share market price of the Common Shares is
determined during a period following the announcement by the issuer of such
Common Shares of (i) a dividend or distribution on such Common Shares payable in
such Common Shares or securities convertible into such Common Shares (other than
the Rights) or (ii) any subdivision, combination or reclassification of such
Common
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Shares, and prior to the expiration of 30 Trading Days after the ex-dividend
date for such dividend or distribution, or the record date for such subdivision,
combination or reclassification, then, and in each such case, the current per
share market price shall be appropriately adjusted to take into account
ex-dividend trading or to reflect the current per share market price per Common
Share equivalent. The closing price for each day shall be the last sale price,
regular way, or, in case no such sale takes place on such day, the average of
the closing bid and asked prices, regular way, in either case as reported in the
principal consolidated transaction reporting system with respect to securities
listed or admitted to trading on the NYSE or, if the Common Shares are not
listed or admitted to trading on the NYSE, as reported in the principal
consolidated transaction reporting system with respect to securities listed on
the principal national securities exchange on which the Common Shares are listed
or admitted to trading or, if the Common Shares are not listed or admitted to
trading on any national securities exchange, the last quoted price or, if not so
quoted, the average of the high bid and low asked prices in the over-the-counter
market, as reported by NASDAQ or such other system then in use, or, if on any
such date the Common Shares are not quoted by any such organization, the average
of the closing bid and asked prices as furnished by a professional market maker
making a market in the Common Shares selected by the Board of Directors of the
Company. If the Common Shares are not publicly held or not so listed or traded,
or not the subject of available bid and asked quotes, "current per share market
price" shall mean the fair value per share as determined in good faith by the
Board of Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent.
(e) Except as set forth below, no adjustment in the Purchase
Price shall be required unless such adjustment would require an increase or
decrease of at least 1% in such price; provided, however, that any
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adjustments which by reason of this Section 11(e) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 11 shall be made to the nearest cent or to
the nearest one ten thousandth of a Common Share or other security, as the case
may be. Notwithstanding the first sentence of this Section 11(e), any adjustment
required by this Section 11 shall be made no later than the earlier of (i) three
years from the date of the transaction which requires such adjustment and (ii)
the Expiration Date.
(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 securities of the Company other than Common Shares, thereafter the
number of such other securities 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 Shares
contained in this Section 11, and the provisions of Sections 7, 9, 10 and 13
hereof with respect to the Common Shares shall apply on like terms to any such
other securities.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of Common Shares issuable
from time to time hereunder upon exercise of the Rights, all subject to further
adjustment as provided herein.
(h) Unless the Company shall have exercised its election as
provided in Section 11(i) hereof, upon each adjustment of the Purchase Price as
a result of the calculations made in Section 11(b) and Section 11(c) hereof made
with respect to a distribution of subscription rights, options or warrants
applicable to Common Shares, each Right outstanding immediately prior to the
making of such adjustment
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shall thereafter evidence the right to purchase, at the adjusted Purchase Price,
that number of Common Shares (calculated to the nearest one-thousandth a Common
Share) obtained by (i) multiplying (x) the number of Common Shares issuable upon
exercise of a Right immediately prior to this adjustment by (y) the Purchase
Price in effect immediately prior to such adjustment of the Purchase Price, and
(ii) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.
(i) The Company may elect, on or after the date of any adjustment
of the Purchase Price, to adjust the number of Rights in substitution for any
adjustment in the number of Common Shares issuable upon the exercise of a Right.
Each of the Rights outstanding after such adjustment of the number of Rights
shall be exercisable for the number of Common Shares for which a Right was
exercisable immediately prior to such adjustment. Each Right held of record
prior to such adjustment of the number of Rights shall become that number of
Rights (calculated to the nearest one-thousandth) obtained by dividing the
Purchase Price in effect immediately prior to adjustment of the Purchase Price
by the Purchase Price in effect immediately after adjustment of the Purchase
Price. The Company shall make a public announcement of its election to adjust
the number of Rights, indicating the record date for the adjustment, and, if
known at the time, the amount of the adjustment to be made. This record date may
be the date on which the Purchase Price is adjusted or any day thereafter, but,
if the Right Certificates have been issued, shall be at least 10 calendar days
later than the date of the public announcement. If Right Certificates have been
issued, upon each adjustment of the number of Rights pursuant to this Section
11(i), the Company shall, as promptly as practicable, cause to be distributed to
holders of record of Right Certificates on such record date Right Certificates
evidencing, subject to the provisions of Section 14 hereof, the additional
Rights to which such
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holders shall be entitled as a result of such adjustment, or, at the option of
the Company, shall cause to be distributed to such holders of record in
substitution and replacement for the Right Certificates held by such holders
prior to the date of adjustment, and upon surrender thereof if required by the
Company, new Right Certificates evidencing all the Rights to which such holders
shall be entitled after such adjustment. Right Certificates so to be distributed
shall be issued, executed and countersigned in the manner provided for herein
(and may bear, at the option of the Company, the adjusted Purchase Price) and
shall be registered in the names of the holders of record of Right Certificates
on the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase
Price or the number or kind of securities issuable upon the exercise of the
Rights, the Right Certificates theretofore and thereafter issued may continue to
express the Purchase Price and the number and kind of securities which were
expressed in the initial Right Certificate issued hereunder.
(k) Before taking any action that would cause an adjustment
reducing the Purchase Price below the then par value, if any, of the Common
Shares or other securities 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 Common Shares or such other securities at such adjusted Purchase
Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuance to the holder of any Right exercised after such record date
the number of Common Shares or other securities of the Company, if any, issuable
upon such exercise over
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and above the number of Common Shares or other 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 Common Shares or other securities upon the
occurrence of the event requiring such adjustment.
(m) Notwithstanding anything in this Agreement to the contrary,
the Company shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that in its good faith judgment the Board of Directors of the Company
shall determine to be advisable in order that any (i) consolidation or
subdivision of the Common Shares, (ii) issuance wholly for cash of Common Shares
at less than the current per share market price therefor, (iii) issuance wholly
for cash of Common Shares or securities which by their terms are convertible
into or exchangeable for Common Shares, (iv) stock dividends, or (v) issuance of
rights, options or warrants referred to in this Section 11, hereafter made by
the Company to holders of its Common Shares shall not be taxable to such
shareholders.
Section 12. Certificate of Adjusted Purchase Price or Number of
Securities. Whenever an adjustment is made as provided in Section 11 or Section
13 hereof, the Company shall promptly (a) prepare a certificate setting forth
such adjustment and a brief statement of the facts accounting for such
adjustment, (b) file with the Rights Agent and with each transfer agent for the
Common Shares a copy of such certificate, and (c) if such adjustment is made
after the Distribution Date, mail a brief summary of such adjustment to each
holder of a Right Certificate in accordance with Section 15 hereof.
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Section 13. Consolidation, Merger or Sale or Transfer of Assets
or Earning Power.
(a) In the event that, following the Share Acquisition Date,
directly or indirectly:
(i) the Company shall consolidate with, or merge with or
into, any other Person and the Company shall not be the continuing or
surviving corporation of such consolidation or merger; or
(ii) any Person shall consolidate with the Company, or
merge with or into the Company and the Company shall be the continuing
or surviving corporation of such merger or consolidation and, in
connection with such merger or consolidation, all or part of the Common
Shares shall be changed into or exchanged for stock or other securities
of any other Person or cash or any other property; or
(iii) the Company shall be a party to any statutory share
exchange with any other Person; or
(iv) the Company shall sell or otherwise transfer (or one
or more of its Subsidiaries shall sell or otherwise transfer), in one
or more transactions, assets or earning power (including, without
limitation, securities creating any obligation on the part of the
Company and/or any of its Subsidiaries) representing in the aggregate
more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any Person or Persons;
then, and in each such case, proper provision shall
be made so that (A) each holder of a Right (except as otherwise
provided herein) shall thereafter have the right to receive, upon the
exercise thereof in accordance with the terms of this Agreement at an
exercise price per Right equal to the product of the then-current
Purchase Price multiplied by the number of Common Shares for which a
Right was exercisable immediately prior to the first occurrence of a
Triggering Event, such
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number of validly authorized and issued, fully paid, nonassessable and
freely tradable Common Shares of the Issuer, free and clear of any
liens, encumbrances and other adverse claims and not subject to any
rights of call or first refusal, as shall be equal to the result
obtained by (x) multiplying the then-current Purchase Price by the
number of Common Shares for which a Right is exercisable immediately
prior to the first occurrence of a Triggering Event and dividing that
product by (y) 50% of the current per share market price of the Common
Shares of the Issuer (determined pursuant to Section 11(d) hereof), on
the date of consummation of such Flip-over Event; (B) the Issuer shall
thereafter be liable for, and shall assume, by virtue of the
consummation of such Flip-over Event, all the obligations and duties of
the Company pursuant to this Agreement; (C) the term "Company" shall
thereafter be deemed to refer to the Issuer; and (D) the Issuer shall
take such steps (including, without limitation, the reservation of a
sufficient number of its Common Shares to permit the exercise of all
outstanding Rights) in connection with such consummation as may be
necessary to assure that the provisions hereof shall thereafter be
applicable, as nearly as reasonably may be possible, in relation to its
Common Shares thereafter deliverable upon the exercise of the Rights.
(b) For purposes of this Section 13, "Issuer" shall mean (i) in
the case of any Flip-over Event described in Sections 13(a)(i) or (ii) above,
the Person that is the continuing, surviving, resulting or acquiring Person
(including the Company as the continuing or surviving corporation of a
transaction described in Section 13(a)(ii) above), (ii) in the case of any
Flip-over Event described in Section 13(a)(iii) above, the Person acquiring the
securities of the shareholders of the Company in such exchange and (iii) in the
case of any Flip-over Event described in Section 13(a)(iv) above, the Person
that is the party receiving the greatest portion of the assets or earning power
(including, without limitation, securities creating any
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obligation on the part of the Company and/or any of its Subsidiaries)
transferred pursuant to such transaction or transactions; provided, however,
that, in any such case, (A) if (1) no class of equity security of such Person
is, at the time of such merger, consolidation or transaction and has been
continuously over the preceding 12-month period, registered pursuant to Section
12 of the Exchange Act, and (2) such Person is a Subsidiary, directly or
indirectly, of another Person, a class of equity security of which is and has
been so registered, the term "Issuer" shall mean such other Person; and (B) in
case such Person is a Subsidiary, directly or indirectly, of more than one
Person, a class of equity security of two or more of which are and have been so
registered, the term Issuers shall mean whichever of such Persons is the issuer
of the equity security having the greatest aggregate market value.
Notwithstanding the foregoing, if the Issuer in any of the Flip-over Events
listed above is not a corporation or other legal entity having outstanding
equity securities, then, and in each such case, (x) if the Issuer is directly or
indirectly wholly owned by a corporation or other legal entity having
outstanding equity securities, then all references to Common Shares of the
Issuer shall be deemed to be references to the Common Shares of the corporation
or other legal entity having outstanding equity securities which ultimately
controls the Issuer, and (y) if there is no such corporation or other legal
entity having outstanding equity securities, (I) proper provision shall be made
so that the Issuer shall create or otherwise make available for purposes of the
exercise of the Rights in accordance with the terms of this Agreement, a kind or
kinds of security or securities having a fair market value at least equal to the
economic value of the Common Shares which each holder of a Right would have been
entitled to receive if the Issuer had been a corporation or other legal entity
having outstanding equity securities; and (II) all other provisions of this
Agreement shall apply to the issuer of such securities as if such securities
were Common Shares.
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(c) The Company shall not consummate any Flip-over Event, unless
the Issuer shall have a sufficient number of authorized Common Shares (or other
securities as contemplated in Section 13(b) above) which have not been issued or
reserved for issuance to permit the exercise in full of the Rights in accordance
with this Section 13 and unless prior to such consummation the Company and the
Issuer shall have executed and delivered to the Rights Agent a supplemental
agreement providing for the terms set forth in subsections (a) and (b) of this
Section 13 and further providing that as promptly as practicable after the
consummation of any Flip-over Event, the Issuer shall:
(i) prepare and file a registration statement under the
Securities Act, with respect to the Rights and the securities issuable
upon exercise of the Rights on an appropriate form, and shall 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 Expiration Date;
(ii) take all such action as may be appropriate under, or
to ensure compliance with, the securities or "blue sky" laws of the
various states in connection with the exercisability of the Rights; and
(iii) deliver to holders of the Rights historical financial
statements for the Issuer and each of its Affiliates which comply in
all respects with the requirements for registration on Form 10 under
the Exchange Act.
(d) The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other transfers. In the event
that a Flip-over Event occurs at any time after the
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occurrence of a Flip-in Event, the Rights which have not theretofore been
exercised shall thereafter become exercisable in the manner described in Section
13(a) hereof.
Section 14. Fractional Rights and Fractional Securities.
(a) The Company shall not be required to issue fractions of Right
or to distribute Right Certificates which evidence fractional Rights. In lieu of
such fractional Rights, the Company shall pay as promptly as practicable to the
registered holders of the Right Certificates with regard to which such
fractional Rights otherwise would be issuable, an amount in cash equal to the
same fraction of the current market value of a whole Right. For the purposes of
this Section 14(a), the current market value of a whole Right shall be the
closing price of the Rights for the Trading Day immediately prior to the date on
which such fractional Rights otherwise would have been issuable. The closing
price for any day shall be the last sale price, regular way, or, in case no such
sale takes place on such day, the average of the closing bid and asked prices,
regular way, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or admitted to
trading on the NYSE or, if the Rights are not listed or admitted to trading on
the NYSE, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the Rights are listed or admitted to trading or, if the Rights are not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by NASDAQ or such other
system then in use or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights selected by the Board of
Directors of the Company. If on any such date no such market maker is making a
market in the Rights, the fair value
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of the Rights on such date as determined in good faith by the Board of Directors
of the Company shall be used.
(b) The Company shall not be required to issue fractions of Common
Shares or other securities issuable upon exercise or exchange of the Rights or
to distribute certificates which evidence any such fractional securities. In
lieu of issuing any such fractional securities, the Company may pay to any
Person to whom or which such fractional securities would otherwise be issuable
an amount in cash equal to the same fraction of the current market value of one
such security. For purposes of this Section 14(b), the current market value of a
Common Share or other security issuable upon the exercise or exchange of Rights
shall be the closing price thereof (as determined in the same manner as set
forth for Common Shares in the second sentence of Section 11(d) hereof) for the
Trading Day immediately prior to the date of such exercise or exchange;
provided, however, that if neither the Common Shares nor any such other
securities are publicly held or listed or admitted to trading on any national
securities exchange, or the subject of available bid and asked quotes, the
current market value of one Common Share or such other security shall be
determined in good faith by the Board of Directors of the Company.
Section 15. Rights of Action. All rights of action in respect of
this Agreement, excepting the rights of action given to the Rights Agent under
Section 18 hereof, are vested in the respective registered holders of the Right
Certificates (and, prior to the Distribution Date, the registered holders of the
Common Shares); and any registered holder of any Right Certificate (or, prior to
the Distribution Date, of the Common Shares), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the holder of any Common Shares), may in his own behalf
and for his own benefit enforce, and may institute and maintain any suit, action
or proceeding against the Company to
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enforce, or otherwise act in respect of, his right to exercise Rights evidenced
by such Right Certificate or Common Share certificate in the manner provided in
such Right Certificate and in this Agreement. Without limiting the foregoing or
any remedies available to the holders of Rights, it is specifically acknowledged
that the holders of Rights would not have an adequate remedy at law for any
breach of this Agreement and shall be entitled to specific performance of the
obligations under this Agreement, and injunctive relief against actual or
threatened violations of the obligations of any Person subject to this
Agreement.
Section 16. Agreement of Rights Holders. Every holder of a
Right by accepting the same consents and agrees with the Company and the Rights
Agent and with every other holder of a Right that:
(a) Prior to the Distribution Date, the Rights shall be
transferable only in connection with the transfer of the Common Shares;
(b) After the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the principal office of the Rights Agent designated for such purpose, duly
endorsed or accompanied by a proper instrument of transfer;
(c) The Company and the Rights Agent may deem and treat the
person in whose name the Right Certificate (or, prior to the Distribution Date,
the associated Common Share certificate) is registered as the absolute owner
thereof and of the Rights evidenced thereby (notwithstanding any notations of
ownership or writing on the Right Certificate or the associated Common Share
certificate made by anyone other than the Company or the Rights Agent) for all
purposes whatsoever, and neither the Company nor the Rights Agent shall be
affected by any notice to the contrary;
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(d) Such holder expressly waives any right to receive any
fractional Rights and any fractional securities upon exercise or exchange of a
Right, except as otherwise provided in Section 14 hereof; and
(e) Notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any holder
of a Right or other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, that the Company shall use
its best efforts to have any such order, decree or ruling lifted or otherwise
overturned as soon as possible.
Section 17. Right Certificate Holder Not Deemed a Shareholder.
No holder, as such, of any Right Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of the Common Shares or any
other securities of the Company which may at any time be issuable upon the
exercise of the Rights represented thereby, nor shall anything contained herein
or in any Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a shareholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
shareholders (except as provided in Section 24 hereof), or to receive dividends
or subscription rights, or otherwise, until the Right or Rights evidenced by
such Right Certificate shall have been exercised in accordance with the
provisions of this Agreement or exchanged pursuant to the provisions of Section
27 hereof.
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Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from time to time,
on demand of the Rights Agent, its reasonable expenses and counsel fees and
other disbursements incurred in the administration and execution of this
Agreement and the exercise and performance of its duties hereunder. The Company
also agrees to indemnify the Rights Agent for, and to hold it harmless against,
any loss, liability, suit, action, proceeding or expense, incurred without gross
negligence, bad faith or willful misconduct on the part of the Rights Agent, for
anything done or omitted by the Rights Agent in connection with the acceptance
and administration of this Agreement, including the costs and expenses of
defending against any claim of liability arising therefrom, directly or
indirectly.
(b) The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or omitted by it in
connection with its administration of this Agreement in reliance upon any Right
Certificate or certificate evidencing Common Shares or other securities of the
Company, instrument of assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, direction, consent, certificate, statement or other
paper or document believed by it to be genuine and to be signed, executed and,
where necessary, verified or acknowledged, by the proper Person or Persons.
Section 19. Merger or Consolidation or Change of Name of Rights
Agent.
(a) Any corporation into which the Rights Agent or any successor Rights
Agent may be merged or with which it may be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any corporation succeeding to the
corporate trust business of the Rights Agent or any successor Rights Agent,
shall be the successor to the
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Rights Agent under this Agreement without the execution or filing of any paper
or any further act on the part of any of the parties hereto, provided that such
corporation would be eligible for appointment as a successor Rights Agent under
the provisions of Section 21 hereof. In case at the time such successor Rights
Agent shall succeed to the agency created by this Agreement, any of the Right
Certificates shall have been countersigned but not delivered, any such successor
Rights Agent may adopt the countersignature of the predecessor Rights Agent and
deliver such Right Certificates so countersigned; and in case at that time any
of the Right Certificates shall not have been countersigned, any successor
Rights Agent may countersign such Right Certificates either in the name of the
predecessor Rights Agent or in the name of the successor Rights Agent; and in
all such cases such Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver Right Certificates so countersigned; and in
case at that time any of the Right Certificates shall not have been
countersigned, the Rights Agent may countersign such Right Certificates either
in its prior name or in its changed name; and in all such cases such Right
Certificates shall have the full force provided in the Right Certificates and in
this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes
the duties and obligations imposed by this Agreement upon the following terms
and conditions, by all of which the Company and the holders of Right
Certificates, by their acceptance thereof, shall be bound:
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(a) The Rights Agent may consult with legal counsel (who may be
legal counsel for the Company), and the opinion of such counsel shall be full
and complete authorization and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that any fact or
matter be proved or established by the Company prior to taking or suffering any
action hereunder, such fact or matter (unless other evidence in respect thereof
be herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by any one of the Chairman of the Board, the
President or any Vice President of the Company and delivered to the Rights
Agent; and such certificate shall be full authorization to the Rights Agent for
any action taken or suffered in good faith by it under the provisions of this
Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its own
gross negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any
of the statements of fact or recitals contained in this Agreement or in the
Right Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be deemed to
have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution and delivery hereof by the Rights Agent) or in
respect of the validity or execution of any Right Certificate (except its
countersignature thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained
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in this Agreement or in any Right Certificate; nor shall it be responsible for
any adjustment required under the provisions of Section 11 or Section 13 hereof
(including any adjustment which results in Rights becoming void) or responsible
for the manner, method or amount of any such adjustment or the ascertaining of
the existence of facts that would require any such adjustment (except with
respect to the exercise of Rights evidenced by Right Certificates after actual
notice of any such adjustment); nor shall it by any act hereunder be deemed to
make any representation or warranty as to the authorization or reservation of
any shares of stock or other securities to be issued pursuant to this Agreement
or any Right Certificate or as to whether any shares of stock or other
securities will, when issued, be validly authorized and issued, fully paid and
nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge
and deliver or cause to be performed, executed, acknowledged and delivered all
such further and other acts, instruments and assurances as may reasonably be
required by the Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from any
one of the Chairman of the Board, the President or any Vice President of the
Company, and to apply to such officers for advice or instructions in connection
with its duties, and it shall not be liable for any action taken or suffered to
be taken by it in good faith in accordance with instructions of any such
officer.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
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<PAGE> 49
Company or otherwise act as fully and freely as though it were not Rights Agent
under this Agreement. Nothing herein shall preclude the Rights Agent from acting
in any other capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself or by or
through its attorneys or agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such act, default,
neglect or misconduct, provided reasonable care was exercised in the selection
and continued employment thereof. The Agent shall not be under any duty or
responsibility to insure compliance with any applicable federal or state
securities laws in connection with the issuance, transfer or exchange of Right
Certificates.
(j) If, with respect to any Right Certificate surrendered to the
Rights Agent for exercise, transfer, split up, combination or exchange, the
certificate attached to the form of assignment or form of election to purchase,
as the case may be, has either not been completed or indicates an affirmative
response to clause 1 or 2 thereof, the Rights Agent shall not take any further
action with respect to such requested exercise, transfer, split up, combination
or exchange, without first consulting with the Company.
Section 21. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties under this
Agreement upon 30 calendar days' notice in writing mailed to the Company and to
each transfer agent of the Common Shares 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 calendar days'
notice in writing, mailed to the Rights Agent or successor Rights Agent, as the
case may be, and to each transfer agent of the Common Shares by registered
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<PAGE> 50
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
calendar days after giving notice of such removal or after it has been notified
in writing of such resignation or incapacity by the resigning or incapacitated
Rights Agent or by the holder of a Right Certificate (who shall, with such
notice, submit his Right Certificate for inspection by the Company), then the
registered holder of any Right Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any successor Rights
Agent, whether appointed by the Company or by such a court, shall be a
corporation organized and doing business under the laws of the United States or
of the State of Georgia or New York (or of any other state of the United States
so long as such corporation is authorized to do business as a banking
institution in the State of Georgia or New York), in good standing, having a
principal office in the State of Georgia or New York, which is authorized under
such laws to exercise corporate trust powers and is subject to supervision or
examination by federal or state authority and which has at the time of its
appointment as Rights Agent a combined capital and surplus of at least $50
million. After appointment, the successor Rights Agent 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 Common Shares,
and mail a notice thereof in writing to the registered holders of the Right
Certificates. Failure to give any notice
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<PAGE> 51
provided for in this Section 21, however, or any defect therein, shall not
affect the legality or validity of the resignation or removal of the Rights
Agent or the appointment of the successor Rights Agent, as the case may be.
Section 22. Issuance of New Right Certificates. Notwithstanding
any of the provisions of this Agreement or of the Rights to the contrary, the
Company may, at its option, issue new Right Certificates evidencing Rights in
such form as may be approved by its Board of Directors to reflect any adjustment
or change in the Purchase Price per share and the number or kind of securities
issuable upon exercise of the Rights made in accordance with the provisions of
this Agreement. In addition, in connection with the issuance or sale by the
Company of Common Shares following the Distribution Date and prior to the
Expiration Date, the Company (a) shall, with respect to Common Shares so issued
or sold pursuant to the exercise or conversion of securities issued prior to the
Distribution Date which are exercisable for, or convertible into, Common Shares,
and (b) may, in any other case, if deemed necessary, appropriate or desirable by
the Board of Directors of the Company, issue Right Certificates representing an
equivalent number of Rights as would have been issued in respect of such Common
Shares if they had been issued or sold prior to the Distribution Date, as
appropriately adjusted as provided herein as if they had been so issued or sold;
provided, however, that (i) no such Right Certificate shall be issued if, and to
the extent that, in its good faith judgment the Board of Directors of the
Company shall have determined that the issuance of such Right Certificate could
have a material adverse tax consequence to the Company or to the Person to whom
or which such Right Certificate otherwise would be issued, and (ii) no such
Right Certificate shall be issued if, and to the extent that, appropriate
adjustment otherwise shall have been made in lieu of the issuance thereof.
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<PAGE> 52
Section 23. Redemption.
(a) The Board of Directors of the Company may, at its option,
redeem all but not less than all of the then-outstanding Rights at the
Redemption Price at any time prior to the Close of Business on the later of (i)
the Distribution Date and (ii) the Share Acquisition Date.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights, and without any further action
and without any notice, the right to exercise the Rights shall terminate and the
only right thereafter of the holders of Rights shall be to receive the
Redemption Price. Promptly after such action ordering the redemption of the
Rights, the Company shall publicly announce such action, and within 10 calendar
days thereafter, the Company shall give notice of such redemption to the holders
of the then-outstanding Rights by mailing such notice to all such holders at
their last addresses as they appear upon the registry books of the Company;
provided, however, that the failure to give, or any defect in, any such notice
shall not affect the validity of the redemption of the Rights. Any notice which
is mailed in the manner herein provided shall be deemed given, whether or not
the holder receives the notice. The notice of redemption mailed to the holders
of Rights shall state the method by which the payment of the Redemption Price
will be made. The Company may, at its option, pay the Redemption Price in cash,
Common Shares (based upon the current per share market price of the Common
Shares (determined pursuant to Section 11(d) hereof) at the time of redemption)
or any other form of consideration deemed appropriate by the Board of Directors
of the Company (based upon the fair market value of such other consideration,
determined by the Board of Directors of the Company in good faith) or any
combination thereof.
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<PAGE> 53
(c) At any time following the Share Acquisition Date, the Board of
Directors of the Company may relinquish the right to redeem the Rights under
this Section 23 by duly adopting a resolution to that effect. Immediately upon
adoption of such resolution, the rights of the Board of Directors of the Company
to redeem the Rights shall terminate without further action and without any
notice. Promptly after adoption of such a resolution, the Company shall publicly
announce such action; provided, however, that the failure to give, or any defect
in, any such notice shall not affect the validity of such action of the Board of
Directors of the Company.
Section 24. Notice of Certain Events.
(a) In case, after the Distribution Date, the Company shall
propose (i) to pay any dividend payable in stock of any class to the holders of
Common Shares or to make any other distribution to the holders of Common Shares
(other than a regular periodic cash dividend), (ii) to offer to the holders of
Common Shares rights, options or warrants to subscribe for or to purchase any
additional Common Shares or shares of stock of any class or any other
securities, rights or options, (iii) to effect any reclassification of its
Common Shares (other than a reclassification involving only the subdivision of
outstanding Common Shares), (iv) to effect any consolidation or merger into or
with, or to effect any sale or other transfer (or to permit one or more of its
Subsidiaries to effect any sale or other transfer), in one or more transactions,
of assets or earning power (including, without limitation, securities creating
any obligation on the part of the Company and/or any of its Subsidiaries)
representing more than 50% of the assets and earning power of the Company and
its Subsidiaries, taken as a whole, to any other Person or Persons, or (v) to
effect the liquidation, dissolution or winding up of the Company, then, in each
such case, the Company shall give to each holder of a Right Certificate, in
accordance with Section 25 hereof, a notice of such proposed action,
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<PAGE> 54
which shall specify the record date for the purposes of such stock dividend,
distribution or offering of rights, options or warrants, or the date on which
such reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution, or winding up is to take place and the date of participation
therein by the holders of the Common Shares, 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 calendar days prior to the record date for
determining holders of the Common Shares for purposes of such action, and, in
the case of any such other action, at least 10 calendar days prior to the date
of the taking of such proposed action or the date of participation therein by
the holders of the Common Shares, whichever shall be the earlier.
(b) In case any Triggering Event shall occur, then, in any such
case, the Company shall as soon as practicable thereafter give to the Rights
Agent and each holder of a Right Certificate, in accordance with Section 25
hereof, a notice of the occurrence of such event, which shall specify the event
and the consequences of the event to holders of Rights.
Section 25. Notices.
(a) Notices or demands authorized by this Agreement to be given
or made by the Rights Agent or by the holder of any Right Certificate to or on
the Company shall be sufficiently given or made if sent by first-class mail,
postage prepaid, addressed (until another address is filed in writing with the
Rights Agent) as follows:
ChoicePoint Inc.
1000 Alderman Drive
Alpharetta, Georgia 30302
Attention: President
(b) Subject to the provisions of Section 21 hereof, any notice or
demand authorized by this Agreement to be given or made by the Company or by the
holder of any Right Certificate to or on the
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<PAGE> 55
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:
SunTrust Bank, Atlanta
Corporate Trust Department
P.O. Box 4625
Atlanta, Georgia 30302
Attention: Department Manager
(c) Notices or demands authorized by this Agreement to be given
or made by the Company or the Rights Agent to the holder of any Right
Certificate (or, if prior to the Distribution Date, to the holder of any
certificate evidencing Common Shares) shall be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed to such holder at the
address of such holder as shown on the registry books of the Company.
Section 26. Supplements and Amendments. Prior to the
Distribution Date and subject to the last sentence of this Section 26, if the
Company so directs, the Company and the Rights Agent may supplement or amend
any provision of this Agreement without the approval of any holders of
certificates representing Common Shares. From and after the Distribution Date
and subject to the last sentence of this Section 26, if the Company so directs,
the Company and the Rights Agent may supplement or amend this Agreement without
the approval of any holders of Right Certificates in order (i) to cure any
ambiguity, (ii) to correct or supplement any provision contained herein which
may be defective or inconsistent with any other provisions herein, (iii) to
shorten or lengthen any time period hereunder, or (iv) to supplement or amend
the provisions hereunder in any manner which the Company may deem desirable,
including, without limitation, the addition of other events requiring
adjustment to the Rights under Sections 11 or 13 hereof or procedures relating
to the redemption of the Rights, which supplement or amendment shall not, in
the good faith
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<PAGE> 56
determination of the Board of Directors of the Company, adversely affect the
interests of the holders of Right Certificates (other than an Acquiring Person
or an Affiliate or Associate of an Acquiring Person). Upon the delivery of a
certificate from an officer of the Company that states that the proposed
supplement or amendment is in compliance with the terms of this Section 26, the
Rights Agent shall execute such supplement or amendment; provided, however, that
the failure or refusal of the Rights Agent to execute such supplement or
amendment shall not affect the validity of any supplement or amendment adopted
by the Company, any of which shall be effective in accordance with the terms
thereof. Notwithstanding anything in this Agreement to the contrary, no
supplement or amendment shall be made at such time as the Rights are not then
redeemable which decreases the stated Redemption Price or the period of time
remaining until the Final Expiration Date or which modifies a time period
relating to when the Rights may be redeemed.
Section 27. Exchange.
(a) The Board of Directors of the Company may, at its option, at
any time after the later of the Distribution Date and the first occurrence of a
Triggering Event, exchange all or part of the then-outstanding and exercisable
Rights (which shall not include Rights that have become void pursuant to the
provisions of Section 11(a)(ii) hereof) for Common Shares at an exchange ratio
of one Common Share per Right, appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the date hereof
(such exchange ratio being hereinafter referred to as the Exchange Ratios).
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, or any entity holding Common Shares for or pursuant to the
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<PAGE> 57
terms of any such plan), who or which, together with all Affiliates and
Associates of such Person, becomes the Beneficial Owner of 50% or more of the
Common Shares then outstanding.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the exchange of any Rights pursuant to Section 27(a) hereof,
and without any further action and without any notice, the right to exercise
such Rights shall terminate and the only right with respect to such Rights
thereafter of the holder of such Rights shall be to receive that number of
Common Shares equal to the number of such Rights held by such holder multiplied
by the Exchange Ratio. Promptly after the action of the Board of Directors of
the Company ordering the exchange of any Rights pursuant to Section 27(a)
hereof, the Company shall publicly announce such action, and within 10 calendar
days thereafter shall give notice of any such exchange to all of the holders of
such Rights at their last addresses as they appear upon the registry books of
the Rights Agent; provided, however, that the failure to give, or any defeat in,
such notice shall not affect the validity of such exchange. Any notice which is
mailed in the manner herein provided shall be deemed given, whether or not the
holder receives the notice. Each such notice of exchange shall state the method
by which the exchange of the Common Shares for Rights will be effected and, in
the event of any partial exchange, the number of Rights which will be exchanged.
Any partial exchange shall be effected pro rata based on the number of Rights
(other than Rights which have become void pursuant to the provisions of Section
11(a)(ii) hereof) held by each holder of Rights.
(c) In any exchange pursuant to this Section 27, the Company, at
its option, may substitute for any Common Share exchangeable for a Right, (i)
equivalent common shares (as such term is used in Section 11(a)(iii) hereof),
(ii) cash, (iii) debt securities of the Company, (iv) other assets, or (v) any
combination of the foregoing, in any event having an aggregate value which the
Board of Directors of the
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<PAGE> 58
Company shall have determined in good faith to be equal to the current market
value of one Common Share (determined pursuant to Section 11(d) hereof) on the
Trading Day immediately preceding the date of exchange pursuant to this Section
27.
Section 28. Successors; Certain Covenants. All the covenants
and provisions of this Agreement by or for the benefit of the Company or the
Rights Agent shall bind and inure to the benefit of their respective successors
and assigns hereunder.
Section 29. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any Person other than the Company, the Rights
Agent and the registered holders of the Right Certificates (and, prior to the
Distribution Date, the Common Shares) any legal or equitable right, remedy or
claim under this Agreement; but this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the registered holders of
the Right Certificates (or prior to the Distribution Date, the Common Shares).
Section 30. Determinations and Actions by the Board of
Directors, etc.. For all purposes of this Agreement, any calculation of the
number of Common Shares outstanding at any particular time, including for
purposes of determining the particular percentage of such outstanding shares 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 Agreement and to exercise all
rights and powers specifically granted to the Board or to the Company, or as
may be necessary or advisable in the administration of this Agreement,
including, without limitation, the right and power to (i) interpret the
provisions of this Agreement, and (ii) make all determinations deemed necessary
or advisable for the
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<PAGE> 59
administration of this Agreement (including a determination to redeem or
exchange or not to redeem or exchange the Rights or to amend the Agreement). 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 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 any member of the Board to any liability to
the holders of the Rights.
Section 31. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated.
Section 32. Governing Law. This Agreement and each Right
Certificate issued hereunder shall be deemed to be a contract made under the
internal substantive laws of the State of Georgia and for all purposes shall be
governed by and construed in accordance with the internal substantive laws of
such State applicable to contracts to be made and performed entirely within such
State.
Section 33. Counterparts. This Agreement may be executed in
any number of counterparts and each of such counterparts shall for all purposes
be deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.
Section 34. Descriptive Headings. Descriptive headings of the
several Sections of this Agreement are inserted for convenience only and shall
not control or affect the meaning or construction of any of the provisions
hereof.
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<PAGE> 60
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
[SEAL]
Attest: CHOICEPOINT INC.
By: By
---------------------------- -----------------------------------
Secretary Chairman and Chief Executive Officer
[SEAL]
Attest: SUNTRUST BANK, ATLANTA
By: By
---------------------------- ------------------------------------
Name: Thomas Donaldson
Title: Group Vice President
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<PAGE> 61
Exhibit A
Form of Right Certificate
Rights
Certificate No. R- -----------
NOT EXERCISABLE AFTER OCTOBER 29, 2007 OR EARLIER IF
REDEEMED. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT
THE OPTION OF THE COMPANY, AT $0.01 PER RIGHT ON THE
TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES SPECIFIED IN THE RIGHTS
AGREEMENT, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING
PERSON OR AN AFFILIATE OR AN ASSOCIATE OF AN
ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT) MAY BECOME NULL AND VOID.
Right Certificate
CHOICEPOINT INC.
This certifies that _______________, or registered assigns, is the
registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the Rights
Agreement, dated as of October 29, 1997 (the "Rights Agreement"), between
ChoicePoint Inc., a Georgia corporation (the "Company"), and SunTrust Bank,
Atlanta, a Georgia banking corporation (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. (Eastern time) on October 29, 2007
at the principal office or offices of the Rights Agent designated for such
purpose, one fully paid nonassessable share of common stock, par value $.10 per
share (the "Common Shares"), of the Company, at a purchase price of $180 per
Common Share (the "Purchase Price"), upon presentation and surrender of this
Right Certificate with the Form of Election to Purchase and related Certificate
duly executed. If this Right Certificate shall be exercised in part, the holder
shall be entitled to receive upon surrender hereof another Right Certificate or
Right Certificates for the number of whole Rights not exercised. The number of
Rights evidenced by this Right Certificate (and the number of Common Shares
which may be purchased upon exercise thereof) set forth above, and the Purchase
Price set forth above, are the number and Purchase Price as of November 14,
1997, based on the Common Shares as constituted at such date.
As provided in the Rights Agreement, the Purchase Price and the number
and kind of securities issuable upon the exercise of the Rights evidenced by
this Right Certificate are subject to adjustment upon the happening of certain
events.
A-1
<PAGE> 62
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 of the Rights Agent,
the Company and the holders of the Right Certificates, which limitations of
rights include the temporary suspension of the exercisability of the Rights
under the circumstances specified in the Rights Agreement. Copies of the Rights
Agreement are on file at the above-mentioned office of the Rights Agent.
Pursuant to the Rights Agreement, from and after the later of the
Distribution Date and the first occurrence of a Flip-in Event (as such term is
defined in the Rights Agreement), (i) any Rights that are or were acquired or
beneficially owned by any Acquiring Person (or any Affiliate or Associate 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 the
Rights Agreement, (ii) no Right Certificate shall be issued pursuant to the
Rights Agreement that represents Rights beneficially owned by an Acquiring
Person or any Affiliate or Associate thereof, (iii) no Right Certificate shall
be issued at any time upon the transfer of any Rights to an Acquiring Person or
any Affiliate or Associate thereof or to any nominee of such Acquiring Person or
Affiliate or Associate thereof, and (iv) any Right Certificate delivered to the
Rights Agent for transfer to an Acquiring Person or any Affiliate or Associate
thereof shall be cancelled.
This Right Certificate, with or without other Right Certificates, may
be transferred, split up, combined or exchanged for another Right Certificate or
Right Certificates, entitling the holder to purchase a like number of Common
Shares (or other securities, as the case may be) as the Right Certificate or
Right Certificates surrendered shall have entitled such holder (or former holder
in the case of a transfer) to purchase, upon presentation and surrender hereof
at the principal office of the Rights Agent designated for such purpose, with
the Form of Assignment (if appropriate) and the related Certificate duly
executed.
Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Certificate may be redeemed by the Company at its option at a redemption
price of $0.01 per Right. The Rights Agreement may be supplemented and amended
by the Company, as provided therein.
The Company is not required to issue fractional Common Shares or other
securities issuable upon the exercise of any Right or Rights evidenced hereby.
In lieu of issuing such fractional Common Shares or other securities, the
Company may make a cash payment, as provided in the Rights Agreement.
No holder of this Right Certificate, as such, shall be entitled to vote
or receive dividends or be deemed for any purpose the holder of the Common
Shares or of any other securities of the Company which may at any time be
issuable upon the exercise of the Right or Rights represented hereby, nor shall
anything contained herein or in the Rights Agreement be construed to confer upon
the holder hereof, as such, any of the rights of a shareholder of the Company or
any right to vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
shareholders (except as provided in the Rights Agreement), or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
A-2
<PAGE> 63
evidenced by this Right Certificate shall have been exercised in accordance with
the provisions of 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.
A-3
<PAGE> 64
WITNESS the facsimile signature of the proper officers of the Company
and its corporate seal. Dated as of __________, 19__.
ATTEST: CHOICEPOINT INC.
By
- ---------------------------------- ------------------------------
Secretary Title:
[SEAL]
Countersigned:
SunTrust Bank, Atlanta
By
-------------------------------
Authorized Signature
A-4
<PAGE> 65
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate)
FOR VALUE RECEIVED,___________________________________________________
hereby sells, assigns and transfers unto_______________________________________
- -------------------------------------------------------------------------------
(Please print name and address of transferee)
- -------------------------------------------------------------------------------
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint ____________________ Attorney, to
transfer the within Right Certificate on the books of the within-named Company,
with full power of substitution.
Dated: ____________, 19__
----------------------------------
Signature
Signature Guaranteed:
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Right Certificate [ ] are [ ] are not
being sold, assigned, transferred, split up, combined or exchanged by or on
behalf of a Person who is or was an Acquiring Person or an Affiliate or
Associate of any such Person (as such terms are defined in the Rights
Agreement);
(2) after due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Right Certificate from
any Person who is, was or became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person.
Dated: __________, 19__
---------------------------------
Signature
A-5
<PAGE> 66
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise the Right Certificate)
To ChoicePoint Inc.:
The undersigned hereby irrevocably elects to exercise ________ Rights
represented by this Right Certificate to purchase the Common Shares or other
securities issuable upon the exercise of such Rights and requests that
certificates for such securities be issued in the name of:
Please insert social security
or other identifying number:
-------------------------------------------------
(Please print name and address)
- -------------------------------------------------------------------------------
If such number of Rights shall not be all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:
Please insert social security or
other identifying number:
-----------------------------------------------------
- -------------------------------------------------------------------------------
(Please print name and address)
- -------------------------------------------------------------------------------
Optional Election to Exercise without Payment of Cash:
With respect to the exercise of the ________ Rights specified above,
the undersigned hereby elects to exercise such Rights without payment of cash
and to receive a number of Common Shares or other securities having a value (as
determined pursuant to the Rights Agreement) equal to the difference between (i)
the value of the Common Shares or other securities that would have been issuable
upon the exercise thereof upon payment of the cash amount as provided in the
Rights Agreement, and (ii) the amount of such cash payment.
Dated: __________, 19__
--------------------------------
Signature
Signature Guaranteed:
A-6
<PAGE> 67
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Right Certificate [ ] are [ ]
are not being exercised by or on behalf of a Person who is or was an Acquiring
Person or an Affiliate or Associate of any such Person (as such terms are
defined pursuant to the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it [ ] did [ ] did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Dated: __________, 19__
----------------------------------
Signature
NOTICE
Signatures on the foregoing Form of Assignment and Form of Election to
Purchase and in the related Certificates must correspond to the name as written
upon the face of this Right Certificate in even particular, without alteration
or enlargement or any change whatsoever.
Signatures must be guaranteed by a member fine 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.
A-7
<PAGE> 68
Exhibit B
SUMMARY OF RIGHTS TO PURCHASE
COMMON SHARES
The Board of Directors of ChoicePoint Inc. (the "Company") has declared
a dividend distribution of one right (a "Right") for each outstanding share of
common stock, par value $0.10 per share (the "Common Shares"), of the Company.
The distribution is payable to the shareholders of record as of the close of
business on November 14, 1997 (the "Record Date"). Each Right entitles the
registered holder to purchase from the Company one Common Share at a price of
$180 (the "Purchase Price"), subject to adjustment. The description and terms of
the Rights are set forth in a Rights Agreement, dated as of October 29, 1997
(the "Rights Agreement"), between the Company and SunTrust Bank, Atlanta, as
Rights Agent (the "Rights Agent").
Until the earliest to occur of (i) the close of business on the tenth
calendar day (or such later date as may be specified by the Board of Directors)
following a public announcement that a person or group of affiliated or
associated persons has acquired, or obtained the right to acquire, beneficial
ownership of 15% or more of the outstanding Common Shares (an "Acquiring
Person"), (ii) the close of business on the tenth business day following the
commencement of a tender offer or exchange offer by a person or group of
affiliated or associated persons, the consummation of which would result in
beneficial ownership by such person or group of 15% or more of the outstanding
Common Shares, or (iii) the close of business on the tenth calendar day
following the first date of public announcement of the first occurrence of a
Flip-in Event or a Flip-over Event (as such terms are hereinafter defined) (the
earliest of such dates being hereinafter called the "Distribution Date"), the
Rights will be evidenced, with respect to any of the Common Share certificates
outstanding as of the Record Date, by such Common Share certificates.
The Rights Agreement provides that, until the Distribution Date, the
Rights will be transferred with and only with the Common Shares. Until the
Distribution Date (or earlier redemption, exchange or expiration of the Rights),
new Common Share certificates issued after the Record Date upon transfer or new
issuance of Common Shares will contain a notation incorporating the Rights
Agreement by reference. Until the Distribution Date (or earlier redemption,
exchange or expiration of the Rights), the surrender for transfer of any
certificates for Common Shares in respect of which Rights have been issued will
also constitute the transfer of the Rights associated with the Common Shares
represented by such certificates. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights (the "Right
Certificates") will be mailed to holders of record of the Common Shares of the
close of business on the Distribution Date and such separate Right Certificates
alone will evidence the Rights.
No Right is exercisable at any time prior to the Distribution Date. The
Rights will expire on October 29, 2007 (the "Final Expiration Date") unless
earlier redeemed or exchanged by the Company as
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described below. Until a Right is exercised, the holder thereof, as such, will
have no rights as a shareholder of the Company, including without limitation the
right to vote or to receive dividends.
The Purchase Price payable, and the number and kind of securities
issuable upon exercise of the Rights and the number of Rights outstanding 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 Shares, (ii) upon the grant to holders of the Common Shares of certain
rights, options or warrants to subscribe for or purchase Common Shares at a
price or securities convertible into Common Shares with a conversion price
less than the then current market price of the Common Shares or (ii) upon the
distribution to holders of the Common Shares of evidences of indebtedness or
cash (excluding regular periodic cash dividends), assets, stock (excluding
dividends payable in Common Shares) or of subscription rights, options or
warrants (other than those referred to above).
In the event (a "Flip-in Event") that (i) any Acquiring Person merges
into or combines with the Company and the Company is the surviving corporation
or any Acquiring Person effects certain other transactions with the Company, as
described in the Rights Agreement, (ii) during such time as there is an
Acquiring Person, there shall be any reclassification of securities or
recapitalization or reorganization of the Company which has the effect of
increasing by more than 1% the proportionate share of the outstanding shares of
any class of equity securities of the Company or any of its subsidiaries
beneficially owned by the Acquiring Person, or (iii) any person or group of
affiliated or associated persons becomes the beneficial owner of 20% or more of
the outstanding Common Shares proper provision shall be made so that each holder
of a Right, other than Rights that are or were owned beneficially by the
Acquiring Person (which, from and after the later of the Distribution Date and
the date of the earliest of any such events, will be void), will thereafter have
the right to receive, upon exercise thereof upon payment of the Purchase Price
of the Right, that number of Common Shares (or, under certain circumstances, an
economically equivalent security or securities of the Company) having a market
value of two times the exercise price of the Right, .
To illustrate the operation of such an adjustment, at a Purchase Price
of $180.00 assuming the current market price (as determined pursuant to the
provisions of the Rights Agreement) per Common Share were $40.00, each Right not
owned beneficially by an Acquiring Person at or after the time of such an
occurrence would entitle its holder to purchase (after the Distribution Date)
from the Company nine (9) Common Shares (having a market value of $360.00) for
$180.00.
In the event (a "Flip-over Event") that, following the first date of
public announcement that a person has become an Acquiring Person, (i) the
Company consolidates with or merges with or into any person and the Company is
not the surviving corporation, (ii) any person consolidates with or merges with
or into the Company and the Company is the surviving corporation, but its Common
Shares are changed or exchanged, (iii) the Company effects a share exchange with
another person, or (iv) 50% or more of the Company's assets or earning power,
including without limitation securities creating obligations of the Company, are
sold, proper provision shall be made so that each holder of a Right will
thereafter have the right to receive, upon the exercise thereof at the then
current exercise price of the Right, that number of shares of common stock (or,
under certain
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circumstances, an economically equivalent security or securities) of such other
person which at the time of such transaction would have a market value of two
times the exercise price of the Right.
At any time after the later of the Distribution Date and the first
occurrence of a Flip-in Event or Flip-over Event and prior to the acquisition by
any person or group of affiliated or associated persons of 50% or more of the
outstanding Common Shares, the Board of Directors of the Company may exchange
the Rights (other than any Rights which have become void), in whole or in part,
at an exchange ratio of one Common Share per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment in the Purchase
Price of at least 1%. The Company is not required to issue fractional Common
Shares or other securities issuable upon the exercise of Rights. In lieu of
issuing such securities, the Company may males a cash payment, as provided in
the Rights Agreement.
The Company may redeem the Rights in whole, but not in part, at a price
of $0.01 per Right (the "Redemption Price"), at any time prior to the close of
business on the later of (i) the Distribution Date and (ii) the first date of
public announcement that a person has become an Acquiring Person. 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.
The Rights Agreement may be amended by the Company without the approval
of any holders of Right Certificates, including amendments which add other
events requiring adjustment to the purchase price payable and the number of
Common Shares or other securities issuable upon the exercise of the Rights or
which modify procedures relating to the redemption of the Rights, provided that
no amendment may be made at such time as the Rights are not then redeemable that
decreases the stated Redemption Price or the period of time remaining until the
Final Expiration Date or that modifies a time period relating to when the Rights
may be redeemed.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A. A
copy of the Rights Agreement is available free of charge from the Company. This
summary description of the Rights is as of October 29, 1997, does not purport to
be complete and is qualified in its entirety by reference to the Rights
Agreement, which is incorporated herein by this reference.
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