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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
JUNE 23, 1998
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Date of report (Date of earliest event reported)
BOWNE & CO., INC.
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(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
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DELAWARE 1-05842 13-2618477
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(State of incorporation organization) (Commission (I.R.S. Employer
File Number) Identification No.)
345 HUDSON STREET
NEW YORK, NEW YORK 10014
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(Address of principal executive (zip code)
offices)
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ITEM 5. OTHER EVENTS.
Reincorporation from the State of New York to the State of Delaware.
Reincorporation; Merger Agreement. On June 19, 1998, Bowne & Co., Inc.,
a New York corporation ("Bowne--New York"), and Bowne & Co., Inc., a wholly
owned subsidiary of Bowne--New York and a Delaware corporation (the "Company" or
"Bowne--Delaware") entered into an Agreement and Plan of Merger pursuant to
which Bowne--New York would merged with and into Bowne--Delaware (the "Merger").
The Merger was effective on June 23, 1998 and the Company is now incorporated
in the State of Delaware.
Certificate of Incorporation and Bylaws. At the effective time of the
Merger, the Certificate of Incorporation and Bylaws of Bowne--Delaware in effect
immediately prior to the effective time of the Merger continue to constitute the
Certificate of Incorporation and Bylaws of Bowne--Delaware.
Directors. The directors of Bowne--New York in office at the effective
time of the Merger currently constitute the directors of Bowne--Delaware, each
holding the same directorship in Bowne--Delaware as he or she held in Bowne--New
York for the terms elected and/or until their respective successors are elected
or appointed and qualified. The directors of Bowne--Delaware will continue to be
members of the same class of directors as they were in Bowne--New York, and the
time for election of each class of directors for Bowne--Delaware will be the
same as it was for the corresponding class of directors of Bowne--New York.
Officers. The officers of Bowne--New York in office at the effective
time of the Merger constitute the officers of Bowne--Delaware, each holding the
same office in Bowne--Delaware as he or she held in Bowne--New York for the
terms elected and/or until their respective successors are elected or appointed
and qualified.
Effect of the Merger. On and after the effective time of the Merger,
the separate existence of Bowne--New York and Bowne--Delaware ceased and
Bowne--Delaware succeeded, without further action, to all the properties and
assets of Bowne--New York and Bowne--Delaware of every kind, nature and
description and to Bowne--New York's and Bowne--Delaware's business as a going
concern. Bowne--Delaware also succeeded to all rights, title and interests to
all real estate and other property owned by Bowne--New York or Bowne--Delaware
without reversion or impairment, without further act or deed, and without any
transfer or assignment having occurred, but subject to any existing liens
thereon. All liabilities and obligations of Bowne--New York or Bowne--Delaware
are now the liabilities and obligations of Bowne--New York, and any proceedings
pending against Bowne--New York or Bowne--Delaware are continued as if the
Merger had not occurred.
Bowne--New York Capital Stock. At the effective time of the Merger, by
virtue of the Merger and without any action on the part of Bowne--New York,
Bowne--Delaware or the holders of any of the common stock ("Bowne--New York
Common Stock") of Bowne--New York, each issued and outstanding share of
Bowne--New York Common Stock and each share of Common Stock of Bowne--New York
held in the treasury of Bowne--New York, were converted into one share of
Bowne--Delaware Common Stock.
Bowne--Delaware Capital Stock. At the effective time of the Merger, by
virtue of the Merger and without any action on the part of Bowne--New York,
Bowne--Delaware or the holders of any of the common stock ("Bowne--Delaware
Common Stock") of Bowne--Delaware, each issued and outstanding share of
Bowne--Delaware Common Stock was cancelled.
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Adoption of Rights Agreement under Delaware Law. Bowne--Delaware also
agreed to adopt a Rights Agreement prior to the effective time of the Merger
substantially similar to the Rights Agreement, dated as of January 30, 1997,
between Bowne--New York and The Bank of New York providing for the issuance of
preferred share purchase rights with each share of Bowne--Delaware Common Stock
issued in the Merger such that the holders of Bowne--Delaware Common Stock would
have effectively the same rights after the Merger that the holders of Bowne--New
York Common Stock had immediately prior to the Merger.
Preferred Share Purchase Rights.
The Company is authorized to issue two classes of capital stock: Common
Stock, par value one cent ($.01) per share (the "Common Stock"), of which
60,000,000 shares are authorized; and Preferred Stock issuable in series, par
value one cent ($.01) per share (herein referred to as the "Preferred Stock"),
of which 1,000,000 shares are authorized. As of June 23, 1998, 18,410,983 shares
of Common Stock were issued and outstanding and no shares of Preferred Stock
were issued or outstanding.
On June 19, 1998 the Board of Directors of Bowne--Delaware authorized
and directed that one preferred share purchase right (a "Right") be issued with
each share of Common Stock, issued in the merger (the "Merger") of Bowne & Co.,
Inc., a New York corporation ("Bowne--New York") into the Company pursuant to
the Agreement and Plan of Merger, dated June 19, 1998, between the Company and
Bowne--New York. Each Right entitles the registered holder to purchase from the
Company one one-thousandth of a share of Series B Junior Participating Preferred
Stock, par value $.01 per share (the "Series B Preferred Stock") of the Company
at a price of $125 per one one-thousandth of a share of Series B Preferred Stock
(the "Purchase Price"), subject to adjustment. The description and terms of the
Rights are set forth in a Rights Agreement dated as of June 19, 1998, as the
same may be amended from time to time (the "Rights Agreement"), between the
Company and The Bank of New York, as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated persons (with
certain exceptions an "Acquiring Person") have acquired beneficial ownership of
20% or more of the outstanding shares of Common Stock or (ii) 10 business days
(or such later date as may be determined by action of the Board of Directors
prior to such time as any person or group of affiliated persons becomes an
Acquiring Person) following the commencement of, or announcement of an intention
to make, a tender offer or exchange offer the consummation of which would result
in the beneficial ownership by a person or group of 20% or more of the
outstanding shares of Common Stock (the earlier of such dates being called the
"Distribution Date") the Rights will be evidenced by with respect to any Old
Certificates (as defined below) outstanding as of the effective time of the
Merger, by such Old Certificates together with a copy of the Summary of Rights
substantially in the form of Exhibit C to the Rights Agreement (the "Summary of
Rights") or by such new certificates issued or exchanged in connection with the
Merger, as the case may be.
The Rights Agreement provides that, until the Distribution Date (or
earlier redemption or expiration of the Rights), the Rights will be transferred
with and only with the Common Stock. Following the Merger and until the
Distribution Date (or earlier redemption or expiration of the Rights),
certificates issued by the Company representing shares of Common Stock (whether
in exchange for certificates of Bowne--New York (the "Old Certificates") or
otherwise) will contain a notation incorporating the Rights Agreement by
reference. After the Merger and until the Distribution Date (or earlier
redemption or expiration of the Rights), the Rights associated with the shares
of Common Stock issued in the Merger and represented by Old Certificates will,
until such Old Certificates are exchanged or new certificates for Common Stock
are issued by the Company, be evidenced by such Old Certificates registered in
the names of the holders thereof together with the Summary of Rights. Until the
Distribution Date (or earlier redemption or expiration of the Rights),
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the surrender for transfer of any certificates for shares of Common Stock
(including Old Certificates), even without such notation or a copy of the
Summary of Rights, will also constitute the transfer of the Rights associated
with the shares of Common Stock represented by such certificate. As soon as
practicable following the Distribution Date, separate certificates evidencing
the Rights ("Right Certificates") will be mailed to holders of record of the
Common Stock as of the close of business on the Distribution Date and such
separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights
will expire on January 30, 2007 (the "Final Expiration Date"), unless the Final
Expiration Date is advanced or extended or unless the Rights are earlier
redeemed or exchanged by the Company, in each case as described below.
The Purchase Price payable, and the number of shares of Series B
Preferred Stock or other securities or property issuable, upon exercise of the
Rights are subject to adjustment from time to time to prevent dilution (i) in
the event of a stock dividend on, or a subdivision, combination or
reclassification of, the Series B Preferred Stock, (ii) upon the grant to
holders of the Series B Preferred Stock of certain rights or warrants to
subscribe for or purchase Series B Preferred Stock at a price, or securities
convertible into Series B Preferred Stock with a conversion price, less than the
then-current market price of the Series B Preferred Stock or (iii) upon the
distribution to holders of the Series B Preferred Stock of evidences of
indebtedness or assets (excluding regular periodic cash dividends or dividends
payable in Series B Preferred Stock) or of subscription rights or warrants
(other than those referred to above).
The Rights are also subject to adjustment in the event of a stock
dividend on the Common Stock payable in shares of Common Stock or subdivisions,
consolidations or combinations of the Common Stock occurring, in any such case,
prior to the Distribution Date.
Shares of Series B Preferred Stock purchasable upon exercise of the
Rights will not be redeemable. Each share of Series B Preferred Stock will be
entitled, when, as and if declared, to a minimum preferential quarterly dividend
payment of $100 per share but will be entitled to an aggregate dividend of 1000
times the dividend declared per share of Common Stock. In the event of
liquidation, dissolution or winding up of the Company, the holders of the Series
B Preferred Stock will be entitled to a minimum preferential liquidation payment
of $100 per share (plus any accrued but unpaid dividends) but will be entitled
to an aggregate payment of 1000 times the payment made per share of Common
Stock. Each share of Series B Preferred Stock will have 1000 votes, voting
together with the Common Stock. Finally, in the event of any merger,
consolidation or other transaction in which shares of Common Stock are converted
or exchanged, each share of Series B Preferred Stock will be entitled to receive
1000 times the amount received per share of Common Stock. These rights are
protected by customary antidilution provisions.
Because of the nature of the Series B Preferred Stock's dividend,
liquidation and voting rights, the value of the one one-thousandth interest in a
share of Series B Preferred Stock purchasable upon exercise of each Right should
approximate the value of one share of Common Stock.
In the event that any person or group of affiliated or associated
persons becomes an Acquiring Person, each holder of a Right, other than Rights
beneficially owned by the Acquiring Person (which will thereupon become void),
will thereafter have the right to receive upon exercise of a Right and payment
of the Purchase Price, that number of shares of Common Stock having a market
value of two times the Purchase Price.
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In the event that, after a person or group has become an Acquiring
Person, the Company is acquired in a merger or other business combination
transaction or 50% or more of its consolidated assets or earning power are sold,
proper provision will be made so that each holder of a Right (other than Rights
beneficially owned by an Acquiring Person which will have become void) 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 of
the person with whom the Company has engaged in the foregoing transaction (or
its parent), which number of shares at the time of such transaction will have a
market value of two times the Purchase Price.
At any time after any person or group becomes an Acquiring Person and
prior to the acquisition by such person or group of 50% or more of the
outstanding shares of Common Stock or the occurrence of an event described in
the prior paragraph, the Board of Directors of the Company may exchange the
Rights (other than Rights owned by such person or group which will have become
void), in whole or in part, at an exchange ratio of one share of Common Stock,
or a fractional share of Series B Preferred Stock (or of a share of a class or
series of the Company's preferred stock having similar rights, preferences and
privileges) of equivalent value, per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional shares of Series B Preferred Stock will be
issued (other than fractions which are integral multiples of one one-thousandth
of a share of Series B Preferred Stock, which may, at the election of the
Company, be evidenced by depositary receipts) and in lieu thereof, an adjustment
in cash will be made based on the market price of the Series B Preferred Stock
on the last trading day prior to the date of exercise.
At any time prior to the time an Acquiring Person becomes such, the
Board of Directors of the Company may redeem the Rights in whole, but not in
part, at a price of $.01 per Right (the "Redemption Price"). The redemption of
the Rights may be made effective at such time, on such basis and with such
conditions as the Board of Directors in its sole discretion may establish.
Immediately upon any redemption of the Rights, the right to exercise the Rights
will terminate and the only right of the holders of Rights will be to receive
the Redemption Price.
For so long as the Rights are then redeemable, the Company may, except
with respect to the redemption price, amend the Rights in any manner. After the
Rights are no longer redeemable, the Company may, except with respect to the
redemption price, amend the Rights in any manner that does not adversely affect
the interests of holders of the Rights.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends.
A copy of the Rights Agreement is filed as an Exhibit to this Current
Report on Form 8-K. A copy of the Rights Agreement is available free of charge
from the Company. This description of the Rights does not purport to be complete
and is qualified in its entirety by reference to the Rights Agreement, as the
same may be amended from time to time, which is hereby incorporated herein by
reference.
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ITEM 7. EXHIBITS.
1. Agreement and Plan of Merger, dated June 19, 1998 by
and between Bowne & Co., Inc., a New York corporation
and Bowne & Co., Inc. a Delaware corporation.
2. Certificate of Designations of Bowne--Delaware (filed
in Delaware on June 19, 1998).
3. Certificate of Incorporation of Bowne--Delaware
(filed in Delaware on June 19, 1998).
4. By-Laws of Bowne--Delaware (effective June 19, 1998).
5. Rights Agreement, dated as of June 19, 1998, between
the Company and The Bank of New York, which includes
the Certificate of Designations for the Series B
Junior Participating Preferred Stock as Exhibit A,
the form of Right Certificate as Exhibit B and the
Summary of Rights to Purchase Preferred Shares as
Exhibit C.
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SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
BOWNE & CO., INC
/s/ Douglas F. Bauer
Douglas F. Bauer
Counsel and Corporate Secretary
Dated: June 24, 1998
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EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
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1. Agreement and Plan of Merger, dated June 19, 1998
by and between Bowne & Co., Inc., a New York
corporation and Bowne & Co., Inc. a Delaware
corporation.
2. Certificat of Incorporation of Bowne-Delaware
(filed in Delaware on June 19, 1998).
3. Certificate of Designations of Bowne-Delaware
(filed in Delaware on June 19, 1998).
4. By-Laws of Bowne-Delaware (effective June 19,
1998).
5. Rights Agreement, dated as of June 19, 1998,
between the Company and The Bank of New York,
which includes the Certificate of Designations
for the Series B Junior Participating Preferred
Stock as Exhibit A, the form of Right Certificate
as Exhibit B and the Summary of Rights to Purchase
Preferred Shares as Exhibit C.
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement"), made
this 19th day of June, 1998, by and between Bowne & Co., Inc., a New York
corporation ("Bowne-New York"), and Bowne & Co., Inc., a Delaware corporation
and a wholly-owned subsidiary of Bowne-New York ("Bowne-Delaware") (the two
corporate parties hereto being sometimes collectively referred to as the
"Constituent Corporations").
W I T N E S S E T H:
WHEREAS, the Boards of Directors of Bowne-New York and Bowne-
Delaware have determined that the proposed merger (the "Merger") of Bowne-New
York with Bowne-Delaware upon the terms hereinafter set forth is advisable and
in the best interests of the shareholders of such corporations and the Boards of
Directors of Bowne-New York and Bowne-Delaware have adopted and approved this
Agreement and both such Boards of Directors have directed that this Agreement be
submitted to the shareholders of Bowne-New York and Bowne-Delaware for their
approval; and
WHEREAS, the Merger is intended to constitute a reorganization
within the meaning of Section 368(a)(1)(F) of the Internal Revenue Code of 1986;
and
WHEREAS, Bowne-New York and Bowne-Delaware, as appropriate,
intend to take all such action as may be necessary or appropriate as and when
required by the provisions of this Agreement, in order to consummate the Merger;
and
WHEREAS, the authorized capital stock of Bowne-New York
consists solely of (i) 60,000,000 shares of common stock, par value $.01 per
share, of which 18,409,983 shares are issued and outstanding as of the date
hereof and (ii) 1,000,000 shares of preferred stock, par vale $.01 per share, of
which no shares are issued and outstanding as of the date hereof; and
WHEREAS, the authorized capital stock of Bowne-Delaware
consists solely of (i) 60,000,000 shares of common stock, par value $.01 per
share, of which 100 shares are issued and outstanding as of the date hereof, all
of which shares are owned by Bowne-New York and (ii) 1,000,000 shares of
preferred stock, par vale $.01 per share, of which no shares are issued and
outstanding as of the date hereof;
NOW, THEREFORE, the Constituent Corporations do hereby agree
to merge on the terms and conditions herein provided, as follows:
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ARTICLE I
GENERAL
1.1 Agreement to Merge. The parties to this Agreement agree to
effect the Merger herein provided for, subject to the terms and conditions set
forth herein.
1.2 Effective Time of the Merger. The Merger shall be
effective in accordance with the laws of the States of New York and Delaware.
The date and time the Merger becomes effective is referred to as the "Effective
Time of the Merger".
1.3 Surviving Corporation. At the Effective Time of the
Merger, Bowne-New York shall be merged with and into Bowne-Delaware, and
Bowne-Delaware shall be the surviving corporation, governed by the laws of the
State of Delaware (hereinafter sometimes called the "Surviving Corporation").
The name of the Surviving Corporation will be Bowne & Co., Inc.
1.4 Certificate of Incorporation and Bylaws. At the Effective
Time of the Merger, the Certificate of Incorporation and Bylaws of
Bowne-Delaware in effect immediately prior to the Effective Time of the Merger
shall be the Certificate of Incorporation and Bylaws of the Surviving
Corporation, subject always to the right of the Surviving Corporation to amend
its Certificate of Incorporation and Bylaws in accordance with the laws of the
State of Delaware and the provisions of the Certificate of Incorporation.
1.5 Directors. The directors of Bowne-New York in office at
the Effective Time of the Merger shall be and constitute the directors of the
Surviving Corporation, each holding the same directorship in the Surviving
Corporation as he or she held in Bowne-New York for the terms elected and/or
until their respective successors shall be elected or appointed and qualified.
The directors of the Surviving Corporation shall continue to be members of the
same class of directors as they were in Bowne-New York, and the time for
election of each class of directors for the Surviving Corporation shall be the
same as it was for the corresponding class of directors of Bowne-New York.
1.6 Officers. The officers of Bowne-New York in office at the
Effective Time of the Merger shall be and constitute the officers of the
Surviving Corporation, each holding the same office in the Surviving Corporation
as he or she held in Bowne-New York for the terms elected and/or until their
respective successors shall be elected or appointed and qualified.
1.7 Effect of the Merger. On and after the Effective Time of
the Merger, the separate existence of Bowne-New York and Bowne-Delaware shall
cease and the Surviving Corporation shall succeed, without further action, to
all the properties and assets of Bowne-New York and Bowne-Delaware of every
kind, nature and description and to Bowne-New York's and Bowne-Delaware's
business as a going concern. The Surviving Corporation shall also succeed to all
rights, title and interests to all real estate and other property owned by
2
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Bowne-New York or Bowne-Delaware without reversion or impairment, without
further act or deed, and without any transfer or assignment having occurred, but
subject to any existing liens thereon. All liabilities and obligations of
Bowne-New York or Bowne-Delaware shall become the liabilities and obligations of
the Surviving Corporation, and any proceedings pending against Bowne-New York or
Bowne-Delaware will be continued as if the Merger had not occurred.
1.8 Further Assurances. Bowne-New York hereby agrees that at
any time, or from time to time, as and when requested by the Surviving
Corporation, or by its successors and assigns, it will execute and deliver, or
cause to be executed and delivered in its name by its last acting officers, or
by the corresponding officers of the Surviving Corporation, all such
conveyances, assignments, transfers, deeds or other instruments, and will take
or cause to be taken such further or other action and give such assurances as
the Surviving Corporation, its successors or assigns may deem necessary or
desirable in order to evidence the transfer, vesting of any property, right,
privilege or franchise or to vest or perfect in or confirm to the Surviving
Corporation, its successors and assigns, title to and possession of all the
property, rights, privileges, powers, immunities, franchises and interests
referred to in this Article I and otherwise to carry out the intent and purposes
thereof.
ARTICLE II
CAPITAL STOCK OF THE CONSTITUENT CORPORATIONS
2.1 Bowne-New York Capital Stock. At the Effective Time of the
Merger, by virtue of the Merger and without any action on the part of Bowne-New
York, Bowne-Delaware or the holders of any of the common stock ("Bowne-New York
Common Stock") of Bowne-New York, each issued and outstanding share of Bowne-New
York Common Stock and each share of Common Stock of Bowne-New York held in the
treasury of Bowne-New York shall be converted into one share of Bowne-Delaware
Common Stock.
2.2 Bowne-Delaware Capital Stock. At the Effective Time of the
Merger, by virtue of the Merger and without any action on the part of Bowne-New
York, Bowne-Delaware or the holders of any of the common stock ("Bowne-Delaware
Common Stock") of Bowne-Delaware, each issued and outstanding share of
Bowne-Delaware Common Stock shall be cancelled.
2.3 Series B Junior Participating Preferred Stock.
Bowne-Delaware agrees to adopt a Rights Agreement prior to the Effective Time
and substantially similar to the Rights Agreement, dated as of January 30, 1997,
between Bowne-New York and The Bank of New York providing for the issuance of
preferred share purchase rights (the "Rights") with each share of Bowne-Delaware
Common Stock issued in the Merger such that the holders of Bowne-Delaware Common
Stock will have effectively the same Rights after the Merger that the holders of
Bowne-New York Common Stock had immediately prior to the Merger.
3
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ARTICLE III
TERMINATION AND AMENDMENT
3.1 Termination. This Agreement may be terminated and
abandoned at any time prior to the Effective Time of the Merger, whether before
or after action thereon by the shareholders of the Constituent Corporations, by
the mutual written consent of the Boards of Directors of Bowne-New York and
Bowne-Delaware.
3.2 Consequences of Termination. In the event of the
termination and abandonment of this Agreement pursuant to the provisions of
Section 3.1 hereof, this Agreement shall be of no further force or effect.
3.3 Modification, Amendment, Etc. Any of the terms or
conditions of this Agreement may be waived at any time, whether before or after
action thereon by the shareholders of the Constituent Corporations, by the party
entitled to the benefits thereof, and this Agreement may be modified or amended
at any time, whether before or after action thereon by the shareholders of the
Constituent Corporations, to the full extent permitted by the corporate laws of
the States of New York and Delaware. Any waiver, modification or amendment shall
be effective only if reduced to writing and executed by the duly authorized
representatives of the Constituent Corporations.
ARTICLE IV
MISCELLANEOUS
4.1 Expenses. The Surviving Corporation shall pay all expenses
of carrying this Agreement into effect and accomplishing the Merger herein
provided for.
4.2 Headings. Descriptive headings are for convenience only
and shall not control or affect the meaning or construction of any provisions of
this Agreement.
4.3 Counterparts. This Agreement may be executed in any number
of counterparts, each of which when so executed and delivered shall be deemed to
be an original instrument, and all such counterparts together shall constitute
only one original.
4.4 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York without regard to
the conflicts of laws principals thereof.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed on its behalf by an officer duly authorized thereunto
as of the date first above written.
BOWNE & CO., INC., a New York corporation
By /s/ Denise K. Fletcher
Its Senior Vice President and Chief Financial Officer
BOWNE & CO., INC., a Delaware corporation
By /s/ Denise K. Fletcher
Its Senior Vice President and Chief Financial Officer
5
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CERTIFICATE OF INCORPORATION
OF
BOWNE & CO., INC.
The undersigned, in order to form a corporation for the
purpose hereinafter stated, under and pursuant to the provisions of the General
Corporation Law of the State of Delaware, hereby certifies that:
FIRST: The name of the Corporation is "Bowne & Co., Inc."
SECOND: The purpose of the Corporation is to engage in any
lawful act or activity for which corporations may be organized under the General
Corporation Law of the State of Delaware.
THIRD: The registered office and registered agent of the
Corporation is Corporation Service Company, 1013 Centre Road, Wilmington,
Delaware, 19805.
FOURTH: The aggregate number of shares which the Corporation
shall have authority to issue is sixty-one million (61,000,000), sixty million
shares of which shall be Common Stock of the par value of $.01 per share and one
million shares of which shall be Preferred Stock of the par value of $.01 per
share. The relative rights, preferences and limitations of the shares of each
class of stock are as follows:
Each holder of Common Stock shall be entitled to one vote for
each share of such stock held by him. Each holder of shares of any series of
Preferred Stock shall be entitled to such voting rights, if any, as shall be
fixed by the Board of Directors of the Company at the time of the issuance of
such series as prescribed by law.
Subject to the provisions of this Article, the Board of
Directors is hereby expressly authorized to issue in series or otherwise the
shares of Preferred Stock, and to fix from time to time before issuance the
number of shares to be included in any series and the terms, limitations,
relative rights and preferences of all shares of such series. The authority of
the Board of Directors with respect to each series shall include, without
limitation thereto, the authority to determine any or all of the following and
the shares of each series may vary from the shares of any other series in the
following respects:
(a) The number of shares constituting such series and the
designation thereof to distinguish the shares of such series from the
shares of all other series;
(b) The annual dividend rate on the shares of such series and
whether such dividends shall be cumulative, and, if cumulative, the
date from which dividends shall be cumulative;
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(c) The redemption price or prices for shares of such series,
if redeemable, and the terms and conditions of such redemption;
(d) The preference, if any, of shares of such series in the
event of any voluntary or involuntary liquidation, dissolution or
winding up of the company;
(e) The voting rights, if any, of shares of such series in
addition to the voting rights prescribed by law, and the terms of
exercise of such voting rights;
(f) The right, if any, of shares of such series to be
converted into shares of any other series or class and the terms and
conditions of such conversion;
(g) The sinking fund provisions, if any, for the redemption or
repurchase of shares of such series; and
(h) Any other terms, limitations and relative rights and
preferences of such series, to the extent permitted by law.
Convertible shares surrendered upon conversion, or redeemable
shares which are redeemed, purchased or otherwise reacquired by the Company,
shall be held as treasury shares until reissued, retired or cancelled by action
of the Board of Directors.
FIFTH: No holder of any of the shares of any class of the
Corporation shall be entitled as of right to subscribe for, purchase, or
otherwise acquire any shares of any class of the Corporation or any securities
convertible into or carrying rights or options which the Corporation proposes to
grant for the purchase of shares of any class of the Corporation or for the
purchase of any shares or other securities of the Corporation which are
convertible into or exchangeable for, or which carry any rights to subscribe
for, purchase, or otherwise acquire, shares of any class of the Corporation; and
any and all of such shares or other securities of the Corporation, whether now
or hereafter authorized or created, may be issued or transferred if the same
have been reacquired and have treasury status, and any and all of such rights
and options may be granted by the Board of Directors to such persons, firms,
corporations and associations, and for such lawful consideration, and on such
terms, as the Board of Directors in its discretion may determine, without first
offering the same, or any thereof, to any said holder.
SIXTH: Whenever, by any provision of law, the vote of
shareholders at a meeting thereof is required or permitted to be taken in
connection with any corporate action, such corporate action shall be taken only
at a stockholder's meeting and not by written consent.
SEVENTH: Prior to the merger of Bowne & Co., Inc., a New York
corporation, with and into the Corporation, the initial Board of Directors shall
consist of those directors set forth in the statement of the Sole Incorporator.
Therefore, the Board of Directors shall consist of not fewer than nine nor more
than fifteen directors, as shall be fixed from time to time by resolution
adopted by a majority of the Board of Directors then in office.
<PAGE> 3
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Notwithstanding any other provision of this Certificate of Incorporation, and in
addition to any other vote that may be required by this Certificate of
Incorporation or by law, this Article may not be amended, altered, repealed or
otherwise changed unless approved by the affirmative vote of the holders of at
least two-thirds of the outstanding shares of stock of the Corporation entitled
to vote thereon.
EIGHTH: The directors elected by the holders of Common Stock
shall be divided into three classes, namely Classes I, II and III. Each class
shall be as nearly equal in number as practicable, and no class shall include
fewer than three directors. Newly created directorships resulting from an
increase in the number of directors, and vacancies occurring in the Board of
Directors for any other reason, may be filled by the affirmative vote of a
majority of the directors then in office, even though such number may constitute
less than a quorum. A director elected to fill a newly created directorship, and
a director elected to fill a vacancy, shall be elected to hold office until the
next annual meeting of shareholders, and until his successor has been elected
and has qualified. No decrease in the number of directors shall shorten the term
of any incumbent director. Subject to the foregoing, at each annual meeting of
shareholders, commencing with the 1985 annual meeting, the successors to the
class of directors whose term of office shall then expire shall be elected to
hold office for a term that shall expire at the third succeeding annual meeting
of shareholders. Directors elected by the shareholders or the Board of Directors
pursuant to this Article EIGHTH may not be removed without cause.
Notwithstanding any other provisions of this Certificate of Incorporation, and
in addition to any other vote that may be required by law or this Certificate of
Incorporation, this Article may not be amended, altered, repealed or otherwise
changed unless approved by the affirmative vote of the holders of at least
two-thirds of the outstanding shares of stock of the Corporation entitled to
vote thereon.
NINTH: Except as otherwise provided by the General Corporation
Law of the State of Delaware as the same exists or may hereafter be amended, no
director of the Corporation shall be personally liable to the Corporation or its
stockholders for monetary damages for breach of fiduciary duty as a director.
Any repeal or modification of this Article NINTH by the stockholders of the
Corporation shall not adversely affect any right or protection of a director of
the Corporation existing at the time of such repeal or modification.
TENTH: The Board of Directors of the Corporation, acting by
majority vote, may alter, amend or repeal the By-Laws of the Corporation.
ELEVENTH: The name and address of the sole incorporator is
Mark Cresitello, 425 Lexington Avenue, New York City, New York 10017-3909.
<PAGE> 4
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IN WITNESS WHEREOF, the undersigned has signed this
Certificate of Incorporation on June 19, 1998.
/s/ Mark C. Cresitello
Sole Incorporator
<PAGE> 1
CERTIFICATE OF DESIGNATIONS
OF
SERIES B JUNIOR PARTICIPATING PREFERRED STOCK
OF
BOWNE & CO., INC.
(Pursuant to Section 151 of the
General Corporation Law of the State of Delaware)
-------------------
Bowne & Co., Inc., a corporation organized and existing under
the General Corporation Law of the State of Delaware (hereinafter called the
"Corporation"), hereby certifies that the following resolution was duly adopted
by the Board of Directors of the Corporation as required by Section 151 of the
General Corporation Law of the State of Delaware by written consent on June 19,
1998:
RESOLVED, that pursuant to the authority granted to and vested
in the Board of Directors of the Corporation (hereinafter called the "Board of
Directors") in accordance with the provisions of the Corporation's Certificate
of Incorporation, (hereinafter called the "Certificate of Incorporation"), a
series of Preferred Stock, par value $.01 per share (the "Preferred Stock"), of
the Corporation be and hereby is created, to be designated "Series B Junior
Participating Preferred Stock" (hereinafter called "Series B Preferred Stock")
and hereby states the designation and number of shares, and fixes the adopts
these resolutions establishing the designations, number of shares, preferences,
voting powers and other rights, powers and preferences thereof, and the
restrictions and limitations thereof, as follows:
1. Amount of Designation. The number of shares constituting
the Series B Preferred Stock shall be 80,000. Such number of shares may
be increased or decreased by resolution of the Board of Directors;
provided, that no decrease shall reduce the number of shares of Series
B Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for issuance upon the
exercise of outstanding options, rights or warrants or upon the
conversion of any outstanding securities issued by the Corporation
convertible into Series B Preferred Stock.
<PAGE> 2
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2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock of the Corporation (the "Preferred Stock")
(or any similar stock) ranking prior and superior to the Series B
Preferred Stock with respect to dividends, the holders of shares of
Series B Preferred Stock in preference to the holders of Common Stock
par value $.01 per share of the Corporation (the "Common Stock") and of
any other stock of the Corporation ranking junior to the Series B
Preferred Stock shall be entitled to receive, when, as and if declared
by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the last day in each
calendar quarter in each year (each such date being referred to herein
as a "Dividend Payment Date"), commencing on the first Dividend Payment
Date after the first issuance of a share or fraction of a share of
Series B Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to the greater of (x) $1 or (y) subject to the
provision for adjustment hereinafter set forth, 1,000 times the
aggregate per share amount of all cash dividends, and 1,000 times the
aggregate per share amount (payable in kind) of all non-cash dividends
or other distributions other than a dividend payable in shares of
Common Stock, declared on the Common Stock since the immediately
preceding Dividend Payment Date or, with respect to the first Dividend
Payment Date, since the first issuance of any share or fraction of a
share of Series B Preferred Stock. In the event the Corporation shall
at any time after June 19, 1998, declare or pay any dividend on the
Common Stock payable in shares of Common Stock, or effect a subdivision
or combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend
in shares of Common Stock) into a greater or lesser number of shares of
Common Stock, then in each such case the amount to which holders of
shares of Series B Preferred Stock were entitled immediately prior to
such event under clause (y) of the preceding sentence shall be adjusted
by multiplying such amount by a fraction, the numerator of which is the
number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution
on the Series B Preferred Stock as provided in paragraph (A) of this
Section immediately after it declares a dividend or distribution on the
Common Stock (other than a dividend payable in shares of Common Stock);
provided that, in the event no dividend or distribution shall have been
declared on the Common Stock during the period between any Dividend
Payment Date and the next subsequent Dividend Payment Date, a dividend
of $1 per share on the Series B
<PAGE> 3
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Preferred Stock shall nevertheless be payable, when, as and if
declared, on such subsequent Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative, whether
or not earned or declared, on outstanding shares of Series B Preferred
Stock from the Dividend Payment Date next preceding the date of issue
of such shares, unless the date of issue of such shares is prior to the
record date for the first Dividend Payment Date, in which case
dividends on such shares shall begin to accrue from the date of issue
of such shares, or unless the date of issue is a Dividend Payment Date
or is a date after the record date for the determination of holders of
shares of Series B Preferred Stock entitled to receive a quarterly
dividend and before such Dividend Payment Date, in either of which
events such dividends shall begin to accrue and be cumulative from such
Dividend Payment Date. Accrued but unpaid dividends shall not bear
interest. Dividends paid on the shares of Series B Preferred Stock in
an amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. The
Board of Directors may fix a record date for the determination of
holders of shares of Series B Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which record
date shall be not more than 60 days prior to the date fixed for the
payment thereof.
3. Voting Rights. The holders of shares of Series B Preferred
Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth and except as otherwise provided in the Certificate of
Incorporation or required by law, each share of Series B Preferred
Stock shall entitle the holder thereof to 1,000 votes on all matters
upon which the holders of the Common Stock of the Corporation are
entitled to vote. In the event the Corporation shall at any time after
June 19, 1998, declare or pay any dividend on the Common Stock payable
in shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common
Stock, then in each such case the number of votes per share to which
holders of shares of Series B Preferred Stock were entitled immediately
prior to such event shall be adjusted by multiplying such number by a
fraction, the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
<PAGE> 4
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(B) Except as otherwise provided in the Certificate of
Incorporation, a Certificate of Designation, or in any amendment
creating a series of Preferred Stock or any similar stock, and except
as otherwise required by law, the holders of shares of Series B
Preferred Stock and the holders of shares of Common Stock and any other
capital stock of the Corporation having general voting rights shall
vote together as one class on all matters submitted to a vote of
shareholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by
law, holders of Series B Preferred Stock shall have no special voting
rights and their consent shall not be required (except to the extent
they are entitled to vote with holders of Common Stock as set forth
herein) for taking any corporate action.
4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series B Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not earned or declared, on
shares of Series B Preferred Stock outstanding shall have been paid in
full, the Corporation shall not:
(i) Declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (as to
dividends) to the Series B Preferred Stock;
(ii) Declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity (as
to dividends) with the Series B Preferred Stock, except
dividends paid ratably on the Series B Preferred Stock and all
such parity stock on which dividends are payable or in arrears
in proportion to the total amounts to which the holders of all
such shares are then entitled;
(iii) Redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding-up) to
the Series B Preferred Stock, provided that the Corporation
may at any time redeem, purchase or otherwise acquire shares
of any such junior stock in exchange for shares of any stock
of the Corporation ranking junior (as to dividends and upon
dissolution, liquidation or winding-up) to the Series B
Preferred Stock or rights, warrants or options to acquire such
junior stock;
(iv) Redeem or purchase or otherwise acquire for
consideration any shares of Series B Preferred Stock,
<PAGE> 5
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or any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding-up) with
the Series B Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of such
shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and
other relative rights and preferences of the respective series
and classes, shall determine in good faith will result in fair
and equitable treatment among the respective series or
classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any
shares of stock of the Corporation unless the Corporation could, under
paragraph (A) of this Section 4, purchase or otherwise acquire such
shares at such time and in such manner.
5. Reacquired Shares. Any shares of Series B Preferred Stock
purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the
acquisition thereof. All such shares shall upon their retirement become
authorized but unissued shares of Preferred Stock and may be reissued
as part of a new series of Preferred Stock to be created by resolution
or resolutions of the Board of Directors, subject to any conditions and
restrictions on issuance set forth herein.
6. Liquidation, Dissolution or Winding-Up. Upon any
liquidation, dissolution or winding-up of the Corporation, no
distribution shall be made (A) to the holders of the Common Stock or of
shares of any other stock of the Corporation ranking junior, upon
liquidation, dissolution or winding-up, to the Series B Preferred Stock
unless, prior thereto, the holders of shares of Series B Preferred
Stock shall have received $100 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not
earned or declared, to the date of such payment, provided that the
holders of shares of Series B Preferred Stock shall be entitled to
receive an aggregate amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 1,000 times the aggregate
amount to be distributed per share to holders of shares of Common
Stock, or (B) to the holders of shares of stock ranking on a parity
upon liquidation, dissolution or winding-up with the Series B Preferred
Stock, except distributions made ratably on the Series B Preferred
Stock and all such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such
liquidation, dissolution or winding-up. In the event, however, that
there are not sufficient assets available to
<PAGE> 6
6
permit payment in full of the Series B liquidation preference and the
liquidation preferences of all other classes and series of stock of the
Corporation, if any, that rank on a parity with the Series B Preferred
Stock in respect thereof, then the assets available for such
distribution shall be distributed ratably to the holders of the Series
B Preferred Stock and the holders of such parity shares in the
proportion to their respective liquidation preferences. In the event
the Corporation shall at any time after June 19, 1998 declare or pay
any dividend on the Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such case the
aggregate amount to which holders of shares of Series B Preferred Stock
were entitled immediately prior to such event under the proviso in
clause (A) of the preceding sentence shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
7. Consolidation, Merger, etc. In case the Corporation shall
enter into any consolidation, merger, combination or other transaction
in which the shares of Common Stock are converted into, exchanged for
or changed into other stock or securities, cash and/or any other
property, then in any such case each share of Series B Preferred Stock
shall at the same time be similarly converted into, exchanged for or
changed into an amount per share (subject to the provision for
adjustment hereinafter set forth) equal to 1,000 times the aggregate
amount of stock, securities, cash and/or any other property (payable in
kind), as the case may be, into which or for which each share of Common
Stock is converted, exchanged or converted. In the event the
Corporation shall at any time after June 19, 1998 declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to the
conversion, exchange or change of shares of Series B Preferred Stock
shall be adjusted by multiplying such amount by a fraction, the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number
of shares of Common Stock that were outstanding immediately prior to
such event.
<PAGE> 7
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8. No Redemption. The shares of Series B Preferred Stock shall
not be redeemable from any holder.
9. Rank. The Series B Preferred Stock shall rank with respect
to the payment of dividends and the distribution of assets upon
liquidation, dissolution or winding-up of the Corporation, junior to
all other series of Preferred Stock and senior to the Common Stock.
10. Amendment. If any proposed amendment to the Certificate of
Incorporation (including the adoption of any Certificate of Designation
or amendment to a Certificate of Designation) would alter, change or
repeal any of the preferences, powers or special rights given to the
Series B Preferred Stock so as to affect the Series B Preferred Stock
adversely, then the holders of the Series B Preferred Stock shall be
entitled to vote separately as a class upon such amendment, and the
affirmative vote of two-thirds of the outstanding shares of the Series
B Preferred Stock voting separately as a class, shall be necessary for
the adoption thereof, in addition to such other vote as may be required
by the General Corporation Law of the State of Delaware.
11. Fractional Shares. Series B Preferred Stock may be issued
in fractions of a share that shall entitle the holder, in proportion to
such holder's fractional shares, to exercise voting rights, receive
dividends, participate in distributions and to have the benefit of all
other rights of holders of Series B Preferred Stock.
<PAGE> 8
IN WITNESS WHEREOF, this Certificate of Designations is
executed on behalf of the Corporation by its Senior Vice President and Chief
Financial Officer and attested by its Secretary this 19th day of June, 1998.
/s/ Denise K. Fletcher
Name: Denise K. Fletcher
Title: Senior Vice President and
Chief Financial Officer
Attest:
/s/ Douglas F. Bauer
Name: Douglas F. Bauer
Title: Secretary
<PAGE> 1
BOWNE & CO., INC.
BY-LAWS
(EFFECTIVE JUNE 19, 1998)
ARTICLE I -- OFFICES
Section 1. Principal Office
The principal office of the Corporation shall be located in the City of
New York, County and State of New York.
Section 2. Additional Offices
The Corporation may also have offices and places of business at such
places as the Board of Directors may from time to time determine or the business
of the Corporation may require.
ARTICLE II -- MEETINGS OF SHAREHOLDERS
Section 1. Annual Meeting
The annual meeting of the shareholders of the Corporation for the
election of directors and for the transaction of such other business as may
properly be brought before the meeting shall be held at such hour, date and
place within or without the State of Delaware as shall be determined by the
Board of Directors and stated in the notice of meeting thereof.
Section 2. Special Meetings
Special meetings of shareholders for the election of directors or for
any other purpose may be held at such time and place, within or without the
State of Delaware, as shall be stated in the notice of the meeting. Special
meetings of shareholders for any purpose or purposes, unless otherwise
prescribed by statute or by the Certificate of Incorporation, may be called by
resolution of the Board of Directors or by the Chief Executive Officer.
Section 3. Notice of Shareholder Meetings
Written notice of every meeting of shareholders, stating the place,
date, and hour of the meeting, the purpose or purposes for which the meeting is
called, and, unless it is the annual meeting, by or at whose direction it is
being issued, shall be served personally or by mail upon each shareholder
entitled to vote thereat not less than ten (10) nor more than sixty
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2
(60) days prior to the meeting. If, at any meeting, action is proposed to be
taken which would, if taken, entitle shareholders fulfilling the requirements of
Section 262 of the Delaware General Corporation Law (procedure to perfect
shareholder's appraisal rights) to receive payment for their shares, the notice
of such meeting shall include a statement of that purpose and to that effect.
If mailed, such notice shall be directed to a shareholder at his
address as it shall appear on the books of the Corporation unless he shall have
filed with the Secretary of the Corporation a written request that notices
intended for him shall be mailed to the address designated in such request.
Section 4. Record Date
For the purpose of determining the shareholders entitled to notice of
or to vote at any meeting of shareholders or any adjournment thereof, or to
express consent to or dissent from any proposal without a meeting, or for the
purpose of determining shareholders entitled to receive payment of any dividend
or the allotment of any rights, or for the purpose of any other action affecting
the interests of shareholders, the Board of Directors may fix, in advance, a
record date. Such date shall not be more than sixty (60) nor less than ten (10)
days before the date of any such meeting, nor more than sixty (60) days prior to
any other action.
In each such case, except as otherwise provided by law, only such
persons as shall be shareholders of record on the date so fixed shall be
entitled to notice of, and to vote at, such meeting and any adjournment thereof,
or to express such consent or dissent, or to receive payment of such dividend or
such allotment of rights, or otherwise to be recognized as shareholders for the
related purpose, notwithstanding any registration of transfer of shares on the
books of the Corporation after any such record date so fixed.
Section 5. Quorum
The holders of a majority of the shares issued and outstanding and
entitled to vote thereat, present in person or represented by proxy, shall be
necessary to and shall constitute a quorum at all meetings of the shareholders
for the transaction of business, except as otherwise provided by statute or by
the Certificate of Incorporation or these By-Laws. If a quorum shall not be
present or represented, the shareholders entitled to vote thereat, present in
person or represented by proxy, shall have power to adjourn the meeting from
time to time, without notice other than announcement at the meeting, until a
quorum shall be present or represented. At any such adjourned meeting at which a
quorum shall be present or represented, any business may be transacted which
might have been transacted at the meeting as originally noticed. If a meeting is
adjourned for more than thirty (30) days, or if after the meeting is adjourned a
new record date is fixed for the adjourned meeting, a notice of the adjourned
meeting shall be given to each stockholder of record entitled to vote at the
meeting.
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Section 6. Voting
Directors shall, except as otherwise required by law or by the
Certificate of Incorporation as permitted by law, be elected by a plurality of
the votes cast at a meeting of shareholders by the holders of shares entitled to
vote in the election.
Whenever any corporate action, other than the election of directors, is
to be taken by vote of the shareholders, it shall, except as otherwise required
by law or by the Certificate of Incorporation as permitted by law, be authorized
by a majority of the votes cast at a meeting of shareholders by the holders of
shares entitled to vote thereon.
Section 7. Proxies
Every proxy must be signed by the shareholder or his attorney-in-fact.
No proxy shall be valid after the expiration of three years from the date
thereof unless otherwise specified therein. Every proxy shall be revocable at
the pleasure of the shareholder executing it, except if it states that it is
irrevocable and is coupled with an interest sufficient in law to support an
irrevocable power or as otherwise provided by law.
Section 8. Consents
Whenever, by any provision of law, the vote of shareholders at a
meeting thereof is required or permitted to be taken in connection with any
corporate action, such corporate action shall be taken only at a stockholder's
meeting and not by written consent.
Section 9. Nominations and Proposals
The Board of Directors may nominate candidates for election as
directors of the Corporation and may propose such other matters for approval of
the stockholders as the Board deems necessary or appropriate.
Any stockholder entitled to vote for directors may nominate candidates
for election as directors of the Corporation, provided, however, that so long as
the Corporation has more than one stockholder, no nominations for director of
the Corporation by any person other than the Board of Directors shall be
presented to any meeting of the stockholders unless the person making the
nomination is a record stockholder and shall have delivered a written notice to
the Secretary of the Corporation not earlier than ninety (90) days nor later
than sixty (60) days in advance of the anniversary of the date of the
immediately preceding annual meeting or if the date of the annual meeting occurs
more than thirty (30) days before or sixty (60) days after the anniversary of
such immediately preceding annual meeting, not later than the close of business
on the later of (i) the sixtieth day prior to such annual meeting and (ii) the
tenth day following the date on which public announcement of the date of such
meeting is first made. Such notice shall (a) set forth the name and address of
the person advancing such nomination and the nominee, together with such
information concerning the person making the nomination and the nominee as would
be required by the appropriate rules and regulations of the Securities and
Exchange Commission to be included in a proxy statement soliciting
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proxies for the election of such nominee, and (b) shall include the duly
executed written consent of such nominee to serve as a director if elected.
No proposal by any person other than the Board of Directors shall be
submitted for the approval of stockholders at any regular or special meeting of
stockholders of the Corporation unless the person advancing such proposal shall
have delivered a written notice to the Secretary of the Corporation not earlier
than ninety (90) days nor later than sixty (60) days in advance of the
anniversary of the date of the immediately preceding annual meeting or if the
date of the annual meeting occurs more than thirty (30) days before or sixty
(60) days after the anniversary of such immediately preceding annual meeting,
not later than the close of business on the later of (i) the sixtieth day prior
to such annual meeting and (ii) the tenth day following the date on which public
announcement of the date of such meeting is first made. Such notice shall set
forth the name and address of the person advancing the proposal, any material
interest of such person in the proposal, and such other information concerning
the person making such proposal and the proposal itself as would be required by
the appropriate rules and regulations of the Securities and Exchange Commission
to be included in a proxy statement soliciting proxies for the proposals.
For purposes of this Section, "public announcement" shall mean
disclosure in a press release reported by the Dow Jones News Service, Associated
Press or a comparable national news service or in a document publicly filed by
the Corporation with the Securities and Exchange Commission pursuant to Section
13, 14 or 15(d) of the Securities Exchange Act of 1934.
ARTICLE III -- DIRECTORS
Section 1. Number; Tenure
The number of directors to constitute the first Board of Directors
shall be the number specified in the Statement of Organization of the
Corporation executed by the incorporator. Thereafter, the Board of Directors
shall consist of not fewer than nine nor more than fifteen directors as shall be
fixed from time to time by resolution adopted by a vote of a majority of the
Board of Directors then in office at a meeting thereof.
Directors shall be elected at the annual meeting of shareholders in the
manner and for the terms specified in the Certificate of Incorporation, and,
except as provided in Section 2 of this Article III, each director shall be
elected to serve until his successor has been elected and has qualified.
Section 2. Resignation, Removal
Any director may resign at any time. Any director may be removed for
cause by action of the Board or vote of the shareholders, but no director shall
be removed without cause.
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Section 3. Vacancies
If any vacancy occurs in the Board of Directors by reason of the death,
resignation, retirement, disqualification or removal from office of any director
with cause, or if any new directorships are created, the directors then in
office, although less than a quorum, may by majority vote choose a successor or
successors, or fill any newly created directorship, and the directors so chosen
shall hold office until the next annual meeting of shareholders and until their
successors have been elected and have qualified.
ARTICLE IV -- MEETINGS OF THE BOARD
Section 1. Place
The Board of Directors of the Corporation may hold meetings, both
regular and special, either within or without the State of Delaware. Any one or
more members of the Board of Directors, or any committee thereof, may, unless
otherwise restricted by the Certificate of Incorporation or these By-Laws,
participate in a meeting of the Board of Directors, or any committee thereof, by
means of a conference telephone or similar communications equipment by which all
persons participating in the meeting can hear and be heard by each other, and
such participation shall constitute presence in person at the meeting.
Section 2. Regular Meetings
A regular meeting of the Board of Directors may be held immediately
following the annual meeting of stockholders in each year without notice,
provided a quorum shall be present. Regular meetings of the Board of Directors
may be held without notice at such time and at such place as shall from time to
time be determined by the Board.
Section 3. Special Meetings
Special meetings of the Board of Directors may be called by the
Chairman of the Board or by the Chief Executive Officer on two days notice to
each director, either personally or by mail or telegram. Notice of any special
meeting of the Board of Directors need not be given to any director who submits
a signed waiver of notice, whether before or after the meeting, or who attends
the meeting without protesting, prior thereto or at its commencement, the lack
of such notice to him.
Section 4. Quorum; Voting
At all meetings of the Board of Directors the presence of not less than
a majority of the entire Board shall be necessary to constitute a quorum for the
transaction of business, and the vote of a majority of the directors present at
any meeting at which a quorum is present shall be the act of the Board of
Directors, except as may be otherwise specifically provided by law.
<PAGE> 6
6
In determining the presence of a quorum at a meeting of the Board of
Directors or a committee thereof which approves a contract or other transaction
between the Corporation and one or more of its directors, or between the
Corporation and any other corporation, firm, association or other entity in
which one or more of its directors are directors or officers or are financially
interested, the common or interested directors shall be counted. If a quorum
shall not be present at any meeting of the Board or Directors, the directors
present thereat may adjourn the meeting from time to time, without notice other
than announcement at the meeting, until a quorum shall be present.
ARTICLE V -- COMMITTEES OF THE BOARD
Section 1. Designation
The Board of Directors, by resolution adopted by a majority of the
entire Board, may designate from among its members an Executive Committee
consisting of three (3) or more directors. The Board of Directors, by resolution
adopted by a majority of the entire Board, may designate from among its members
one or more additional committees. Each such additional committee shall consist
of three (3) or more directors and each shall have such powers and duties as
shall be fixed by the Board. However, no such committee shall have authority as
to any of the following matters:
(a) approving or adopting, or recommending to the
stockholders, any action or matter expressly required
by Section 141 of the Delaware General Corporation
Law to be submitted to stockholders for approval; or
(b) adopting, amending or repealing any By-Law of the
Corporation.
The Board may designate one or more directors as alternate members of
any such committee who may replace any absent or disqualified member or members
at any meeting of such committee. In the absence or disqualification of a member
of a committee, the member or members present at any meeting and not
disqualified from voting (whether or not such members constitute a quorum) may
unanimously appoint another member of the Board of Directors to act at the
meeting in the place of any such absent or disqualified member.
Section 2. Tenure; Reports
Each such committee shall serve at the pleasure of the Board. It shall
keep minutes of its meetings and report on its meetings to the Board.
Section 3. Executive Committee
Except as set forth in Section 1 of this Article V, the Executive
Committee shall have, between meetings of the Board, all the powers of the Board
of Directors in the management of the business and affairs of the Corporation
and may exercise such powers to the full extent the Board might exercise such
powers as though it were in session.
<PAGE> 7
7
ARTICLE VI -- OFFICERS
Section 1. Appointment
The Board of Directors shall appoint a President, a Secretary and a
Treasurer. The Board of Directors may also appoint one or more Vice Presidents
and such other officers as it may determine.
Section 2. Term of Office; Removal; Vacancies
All officers shall be appointed by the Board of Directors and shall
hold office until the next annual meeting of stockholders and until their
successors are appointed and have qualified. Any officer may be removed with or
without cause at any time by the Board of Directors. If any office becomes
vacant for any reason, the Board of Directors may fill such vacancy.
Section 3. Compensation
The compensation of all officers of the Corporation shall be fixed by
the Board of Directors.
Section 4. The President
The President may, in the absence of the Chairman of the Board and the
Chief Executive Officer, preside at all meetings of the shareholders and
directors; he may effectuate policy decisions and orders of the Board and see
that all resolutions of the Board of Directors are carried into effect. The
President shall have such other powers and duties as may from time to time be
assigned by the Board.
Section 5. Vice President
The Vice President, or Vice Presidents, shall have such powers and
duties as may be designated by the Board of Directors.
Section 6. The Secretary
The Secretary shall attend all meetings of the Board and all meetings
of the shareholders and record all votes and prepare the minutes of all
proceedings in a book, to be kept for that purpose. He shall give, or cause to
be given, notice of all meetings of shareholders and all special meetings of the
Board of Directors and shall perform such other duties as may be designated by
the Board of Directors. He shall keep in safe custody the seal of the
Corporation and, when authorized by the Board, affix the same to any instrument
requiring it and, when so affixed, it shall be attested by his signature, or the
signature of an Assistant Secretary. He shall keep safe custody of the stock
certificate books and shareholder records.
<PAGE> 8
8
Section 7. The Treasurer
The Treasurer shall have care and custody of the funds of the
Corporation and its other valuable effects, including securities, and he shall
keep full and accurate accounts of receipts and disbursements in books belonging
to the Corporation and shall deposit all monies and other valuable effects in
the care and to the credit of the Corporation in such depositories as may be
designated by the Board of Directors. The Treasurer shall disburse the funds of
the Corporation as ordered by the Board. If required by the Board of Directors,
the Treasurer shall give the Corporation a bond for such term, in such sum and
with such surety or sureties as shall be satisfactory to the Board for the
faithful performance of the duties of his office.
ARTICLE VII -- INDEMNIFICATION
Section 1. Indemnification of Officers, Directors, Employees and Agents
The Corporation shall, to the fullest extent permitted by the
Delaware General Corporation Law, as the same may be amended and supplemented,
indemnify any and all persons whom it shall have power to indemnify under said
statute from and against any and all expenses, liabilities or other matters
referred to in or covered by the said statute, and the indemnification provided
for herein shall not be deemed exclusive of any other rights to which those
persons, other than directors or officers, may be entitled under any agreement,
vote of shareholders or directors or otherwise, both as to action in his
official capacity and as to action in another capacity while holding such
office, and shall continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such person. To the fullest extent permitted by
the Delaware General Corporation Law, the Corporation shall indemnify any
current or former director or officer of the Corporation and may, at the
discretion of the Board of Directors, indemnify any current or former employee
or agent of the Corporation against all expenses, judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in connection with
any threatened, pending or completed action, suit or proceeding brought by or in
the right of the Corporation or otherwise, to which he was or is a party by
reason of his current or former position with the Corporation or by reason of
the fact that he is or was serving, at the request of the Corporation, as a
director, officer, partner, trustee, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise.
ARTICLE VIII -- SHARE CERTIFICATES
Section 1. Form, Signature and Transfer
Certificates for stock shall be in such form as the Board of Directors
may from time to time prescribe and shall be signed by the Chairman of the Board
or Chief Executive Officer and by the Treasurer or an Assistant Treasurer or the
Secretary or an Assistant Secretary, and may be countersigned and registered in
such manner and by such transfer agents and registrars as the Board may
prescribe. Where any certificate is signed by a transfer agent or
<PAGE> 9
9
transfer clerk and by a registrar, the signature or signatures of any officers
of the Corporation upon such certificate may be facsimile, engraved or printed;
provided that where the certificate is manually signed by a registrar other than
the Corporation or any employee of the Corporation, the signature of the
transfer agent or transfer clerk may be facsimile, engraved or printed. Shares
of stock of the Corporation shall be transferable or assignable on the books of
the Corporation only by the holders in person or by a duly authorized attorney,
and only upon the surrender for cancellation of the certificates therefor
accompanied by a duly executed assignment and power of attorney endorsed thereon
or attached thereto and such proof or a guarantee of authenticity of the
signature as the Corporation or its agents may reasonably require. The
Corporation may treat the holder of record of any share or shares of stock as
the holder in fact thereof and need not recognize any other claim thereto or
interest therein on the part of any other person, whether or not it has express
or other notice thereof, except as otherwise expressly provided by law. Lost or
destroyed certificates may be replaced in accordance with such regulations as
the Board of Directors may prescribe.
ARTICLE IX -- GENERAL PROVISIONS
Section 1. Fiscal Year
The fiscal year of the Corporation shall be fixed, and shall be subject
to change, by the Board of Directors.
Section 2. Corporate Seal
The corporate seal of the Corporation shall be in such form as the
Board of Directors shall prescribe. The corporate seal on any corporate bond or
other obligation for the payment of money may be a facsimile, engraved or
printed.
Section 3. Checks
All checks or demands for money and notes or other instruments
evidencing indebtedness or obligations of the Corporation shall be signed by
such officer or officers or such other persons as the Board of Directors may
from time to time designate.
ARTICLE X -- AMENDMENTS
Section 1. Power to Amend
The Board of Directors shall have the power to amend, repeal or adopt
By-Laws at any regular or special meeting of the Board. However, any By-Laws
adopted by the Board may be amended or repealed by vote of the holders of a
majority of shares of capital stock represented in person or by proxy at any
meeting.
<PAGE> 1
Rights Agreement
Bowne & Co., Inc.
and
The Bank of New York,
as Rights Agent
Dated as of June 19, 1998
<PAGE> 2
TABLE OF CONTENTS
Section 1. Certain Definitions............................................... 1
Section 2. Appointment of Rights Agent....................................... 8
Section 3. Issue of Right Certificates....................................... 9
Section 4. Form of Right Certificates........................................12
Section 5. Countersignature and Registration.................................13
Section 6. Transfer, Split Up, Combination and Exchange of
Right Certificates; Mutilated, Destroyed, Lost or Stolen
Right Certificates................................................14
Section 7. Exercise of Rights, Purchase Price; Expiration
Date of Rights....................................................16
Section 8. Cancellation and Destruction of Right
Certificates......................................................18
Section 9. Availability of Shares of Preferred Stock.........................19
Section 10. Preferred Stock Record Date......................................22
Section 11. Adjustment of Purchase Price, Number of Shares
and Number of Rights.............................................23
Section 12. Certificate of Adjusted Purchase Price or Number
of Shares........................................................42
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earnings Power.........................................42
Section 14. Fractional Rights and Fractional Shares..........................50
Section 15. Rights of Action.................................................53
Section 16. Agreement of Right Holders.......................................54
Section 17. Right Certificate Holder Not Deemed a
Stockholder......................................................55
Section 18. Concerning the Rights Agent......................................55
Section 19. Merger or Consolidation or Change of Name of
Rights Agent.....................................................56
Section 20. Duties of Rights Agent...........................................58
Section 21. Change of Rights Agent...........................................62
Section 22. Issuance of New Right Certificates...............................64
Section 23. Redemption.......................................................65
- i -
<PAGE> 3
Page
Section 24. Exchange.........................................................66
Section 25. Notice of Certain Events.........................................69
Section 26. Notices..........................................................71
Section 27. Supplements and Amendments.......................................72
Section 28. Successors.......................................................73
Section 29. Benefits of this Agreement.......................................73
Section 30. Determinations and Actions by the Board of
Directors........................................................73
Section 31. Severability.....................................................74
Section 32. Governing Law....................................................74
Section 33. Counterparts.....................................................74
Section 34. Descriptive Headings.............................................74
- ii -
<PAGE> 4
RIGHTS AGREEMENT
Rights Agreement ("Agreement"), dated as of June 19, 1998
between Bowne & Co., Inc., a Delaware corporation (the "Company"), and The Bank
of New York, a national banking association (the "Rights Agent").
The Board of Directors of the Company has authorized and
directed that one preferred share purchase right (a "Right") shall be issued
with each share of Common Stock (as hereinafter defined) of the Company issued
in the Merger (as hereinafter defined), each Right representing the right to
purchase one one-thousandth (subject to adjustment) of a share of Preferred
Stock (as hereinafter defined), upon the terms and subject to the conditions
herein set forth, and has further authorized and directed the issuance of one
Right (subject to adjustment as provided herein) with respect to each share of
Common Stock that shall become outstanding subsequent to the Merger and prior to
the earliest of the Distribution Date, the Redemption Date and the Final
Expiration Date (as such terms are hereinafter defined); provided, however, that
Rights may be issued with respect to shares of Common Stock that shall become
outstanding after the Distribution Date and prior to the Redemption Date and the
Final Expiration Date in accordance with Section 22.
Accordingly, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this
Agreement, the following terms have the meaning indicated:
<PAGE> 5
2
(a) "Acquiring Person" shall mean any Person (as such term is
hereinafter defined) who or which shall be the Beneficial Owner (as
such term is hereinafter defined) of 20% or more of the shares of
Common Stock then outstanding, but shall not include an Exempt Person
(as such term is hereinafter defined); provided, however, that if the
Board of Directors of the Company determines in good faith that a
Person who would otherwise be an "Acquiring Person" has become such
inadvertently (including, without limitation, because (i) such Person
was unaware that it beneficially owned a percentage of Common Stock
that would otherwise cause such Person to be a "Acquiring Person" or
(ii) such Person was aware of the extent of its Beneficial Ownership of
Common Stock but had no actual knowledge of the consequences of such
Beneficial Ownership under this Agreement) and without any intention of
changing or influencing control of the Company, and such Person, as
promptly as practicable after being advised of such determination
divested or divests himself or itself of Beneficial Ownership of a
sufficient number of shares of Common Stock so that such Person would
no longer be an Acquiring Person, then such Person shall not be deemed
to be or to have become an "Acquiring Person" for any purposes of this
Agreement. Notwithstanding the foregoing, no Person shall become an
"Acquiring Person" as the result of an acquisition of shares of Common
Stock by the Company which, by reducing the number of shares
outstanding, increases the
<PAGE> 6
3
proportionate number of shares beneficially owned by such Person to 20%
or more of the shares of Common Stock then outstanding, provided,
however, that if a Person shall become the Beneficial Owner of 20% or
more of the shares of Common Stock then outstanding by reason of such
share acquisitions by the Company and thereafter become the Beneficial
Owner of any additional shares of Common Stock (other than pursuant to
a dividend or distribution paid or made by the Company on the
outstanding Common Stock or pursuant to a split or subdivision of the
outstanding Common Stock), then such Person shall be deemed to be an
"Acquiring Person" (i) unless upon the consummation of the acquisition
of such additional shares of Common Stock such Person does not own 20%
or more of the shares of Common Stock then outstanding or (ii) the
proviso to the first sentence of this Section 1(a) is applicable. For
all purposes of this Agreement, any calculation of the number of shares
of Common Stock outstanding at any particular time, including for
purposes of determining the particular percentage of such outstanding
shares of Common Stock of which any Person is the Beneficial Owner,
shall be made in accordance with the last sentence of Rule
13d-3(d)(1)(i) of the General Rules and Regulations under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), as in
effect on the date hereof.
(b) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of
<PAGE> 7
4
the General Rules and Regulations under the Exchange Act, as in effect
on the date of this Agreement.
(c) "American Stock Exchange" shall mean the American
Stock Exchange, Inc.
(d) A Person shall be deemed the "Beneficial Owner" of, shall
be deemed to have "Beneficial Ownership" of and shall be deemed to
"beneficially own" any securities:
(i) which such Person or any of such Person's
Affiliates or Associates is deemed to beneficially own,
directly or indirectly within the meaning of Rule 13d-3 of the
General Rules and Regulations under the Exchange Act as in
effect on the date of this Agreement;
(ii) which such Person or any of such Person's
Affiliates or Associates has (A) the right to acquire (whether
such right is exercisable immediately or only after the
passage of time) pursuant to any agreement, arrangement or
understanding (other than customary agreements with and
between underwriters and selling group members with respect to
a bona fide public offering of securities), or upon the
exercise of conversion rights, exchange rights, rights,
warrants or options, or otherwise; provided, however, that a
Person shall not be deemed the Beneficial Owner of, or to
beneficially own, (x) 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
<PAGE> 8
5
purchase or (y) securities which such Person has a right to
acquire on the exercise of Rights at any time prior to the
time a Person becomes an Acquiring Person; or (B) the right to
vote pursuant to any agreement, arrangement or understanding;
provided, however, that a Person shall not be deemed the
Beneficial Owner of, or to beneficially own, any security by
reason of such agreement, arrangement or understanding if the
agreement, arrangement or understanding to vote such security
(1) arises solely from a revocable proxy or consent given to
such Person in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the
applicable rules and regulations promulgated under the
Exchange Act and (2) is not also then reportable on Schedule
13D under the Exchange Act (or any comparable or successor
report); or
(iii) which are beneficially owned, directly or indirectly,
by any other Person with which such Person or any of such
Person's Affiliates or Associates has any agreement,
arrangement or understanding (other than customary agreements
with and between underwriters and selling group members with
respect to a bona fide public offering of securities) for the
purpose of acquiring, holding, voting (except to the extent
contemplated by the proviso to Section 1(c)(ii)(B)) or
disposing of any securities of the Company.
<PAGE> 9
6
(e) "Business Day" shall mean any day other than a Saturday, a
Sunday, or a day on which banking institutions in the State of New
York, or the State in which the principal office of the Rights Agent is
located, are authorized or obligated by law or executive order to
close.
(f) "close of business" on any given date shall mean 5:00
P.M., New York City time, on such date; provided, however, that if such
date is not a Business Day it shall mean 5:00 P.M., New York City time,
on the next succeeding Business Day.
(g) "Common Stock" when used with reference to the Company
shall mean the common stock, par value $.01, of the Company (whether
such Common Stock is represented by certificates of Bowne-New York (as
hereinafter defined) not exchanged for certificates of the Company
after the Merger or certificates of the Company issued after the
Merger). "Common Stock" when used with reference to any Person other
than the Company shall mean the capital stock (or, in the case of an
unincorporated entity, the equivalent equity interest) with the
greatest voting power of such other Person or, if such other Person is
a subsidiary of another Person, the Person or Persons which ultimately
control such first-mentioned Person.
(h) "Distribution Date" shall have the meaning set forth in
Section 3 hereof.
(i) "equivalent preferred shares" shall have the meaning set
forth in Section 11(b) hereof.
<PAGE> 10
7
(j) "Exempt Person" shall mean (i) Bowne & Co., Inc., a New
York corporation and the sole stockholder of the Company prior to the
Merger and (ii) the Company, any Subsidiary (as such term is
hereinafter defined) of the Company, in each case including, without
limitation, in its fiduciary capacity, or, any employee benefit plan of
the Company or of any Subsidiary of the Company, or any entity or
trustee holding Common Stock for or pursuant to the terms of any such
plan or for the purpose of funding any such plan or funding other
employee benefits for employees of the Company or of any Subsidiary of
the Company.
(k) "Final Expiration Date" shall have the meaning set forth
in Section 7 hereof.
(l) "Merger" shall mean the merger of Bowne & Co., Inc. a New
York corporation ("Bowne-New York") with and into the Company pursuant
to the Agreement and Plan of Merger, dated June 19, 1998, between
Bowne-New York and the Company (the "Merger Agreement").
(m) "Old Certificate" shall mean those certificates of Common
Stock, par value $.01 per share, of Bowne--New York held by the holders
thereof immediately prior to the Merger.
(n) "Person" shall mean any individual, firm, corporation or
other entity, and shall include any successor (by merger or otherwise)
of such entity.
(o) "Preferred Stock" shall mean the Series B Junior
Participating Preferred Stock, par value $.01 per share, of the Company
having the rights and preferences set forth in
<PAGE> 11
8
the Form of the Certificate of Designations attached to this
Agreement as Exhibit A.
(p) "Redemption Date" shall have the meaning set forth in
Section 7 hereof.
(q) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(r) "Stock Acquisition Date" shall mean the first date of
public announcement (which for purposes of this definition, shall
include, without limitation, a report filed pursuant to Section 13(d)
of the Exchange Act) by the Company or an Acquiring Person that an
Acquiring Person has become such or such earlier date as a majority of
the Board of Directors shall become aware of the existence of an
Acquiring Person.
(s) "Subsidiary" of any Person shall mean any corporation or
other entity of which securities or other ownership interests having
ordinary voting power sufficient to elect a majority of the board of
directors or other persons performing similar functions are
beneficially owned, directly or indirectly, by such Person, and any
corporation or other entity that is otherwise controlled by such
Person.
Section 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company and the holders of the
Rights (who, in accordance with Section 3 hereof, shall prior to the
Distribution Date also be the holders of Common Stock) in accordance with the
terms and conditions hereof, and the Rights Agent hereby accepts such
appointment.
<PAGE> 12
9
The Company may from time to time appoint such co-Rights Agents as it may deem
necessary or desirable.
Section 3. Issue of Right Certificates. (a) Until the earlier
of (i) the tenth day after the Stock Acquisition Date or (ii) the tenth business
day (or such later date as may be determined by action of the Board of Directors
prior to such time as any Person becomes an Acquiring Person) after the date of
the commencement by any Person (other than an Exempt Person) of, or of the first
public announcement of the intention of such Person (other than an Exempt
Person) to commence, a tender or exchange offer the consummation of which would
result in any Person (other than an Exempt Person) becoming the Beneficial Owner
of shares of Common Stock aggregating 20% or more of the Common Stock then
outstanding (including any such date which is after the date of this Agreement
and prior to the issuance of the Rights), the earlier of such dates being herein
referred to as the "Distribution Date"), (x) the Rights will be evidenced
(subject to the provisions of Section 3(b) hereof) by the certificates for
Common Stock registered in the names of the holders thereof and not by separate
Right Certificates, and (y) the Rights will be transferable only in connection
with the transfer of Common Stock. As soon as practicable after the Distribution
Date, the Company will prepare and execute, the Rights Agent will countersign,
and the Company will send or cause to be sent (and the Rights Agent will, if
requested, send) by first-class, insured, postage-prepaid mail, to each record
holder of Common Stock as of the close of business on the Distribution Date
(other
<PAGE> 13
10
than any Acquiring Person or any Associate or Affiliate of an Acquiring Person),
at the address of such holder shown on the records of the Company, a Right
Certificate, in substantially the form of Exhibit B hereto (a "Right
Certificate"), evidencing one Right (subject to adjustment as provided herein)
for each share of Common Stock so held. As of the Distribution Date, the Rights
will be evidenced solely by such Right Certificates.
(b) Following the Merger, the Company will send a copy of the
Summary of Rights to Purchase Shares of Preferred Stock (the "Summary of
Rights") substantially in the form attached hereto as Exhibit C, by first-class,
postage-prepaid mail, to each record holder of common stock, par value $.01 per
share, of Bowne-New York immediately prior to the Merger (other than any
Acquiring Person or any Associate or Affiliate of an Acquiring Person) at the
address of such holder shown on the records of Bowne-New York immediately prior
to the Merger. As soon as practicable after the date of the Merger, the Company
shall file with the Securities and Exchange Commission the full text of this
Agreement and a summary thereof, which summary shall be in substantially the
form of the Summary of Rights. Until the Distribution Date (or the earlier of
the Redemption Date or the Final Expiration Date), the Rights associated with
shares of Common Stock issued in the Merger which, in accordance with the Merger
Agreement, are to be represented by Old Certificates until exchanged for new
certificates of Common Stock of the Company after the Merger, will be evidenced
by such Old Certificates registered in the names of the holders thereof together
with the
<PAGE> 14
11
Summary of Rights, until such Old Certificates are exchanged or replaced with
new certificates of Common Stock of the Company. Until the Distribution Date (or
the earlier of the Redemption Date or the Final Expiration Date), the surrender
for transfer of any Old Certificate, with or without a copy of the Summary of
Rights, shall also constitute the transfer of the Rights associated with the
Common Stock represented thereby.
(c) Certificates issued for Common Stock (including, without
limitation, in exchange for Old Certificates, upon transfer of outstanding
Common Stock, disposition of Common Stock out of treasury stock or issuance or
reissuance of Common Stock out of authorized but unissued shares) after the date
hereof but prior to the earliest of the Distribution Date, the Redemption Date
or the Final Expiration Date shall have impressed on, printed on, written on or
otherwise affixed to them, the following legend:
This certificate also evidences and entitles the holder hereof
to certain rights as set forth in the Rights Agreement between
Bowne & Co., Inc. and The Bank of New York, dated as of June
19, 1998 as the same may be amended from time to time (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 Bowne & Co., Inc..
Under certain circumstances, as set forth in the Rights
Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this
certificate. Bowne & Co., Inc. will mail to the holder of this
certificate a copy of the Rights Agreement without charge
after receipt of a written request therefor. Under certain
circumstances, as set forth in the Rights Agreement, Rights
owned by or transferred to any Person who becomes an Acquiring
Person (as defined in the Rights Agreement) and
<PAGE> 15
12
certain transferees thereof will become null and void and will
no longer be transferable.
With respect to such certificates containing the foregoing legend, until the
Distribution Date (or the earlier of the Redemption Date or the Final Expiration
Date), the Rights associated with the Common Stock represented by such
certificates shall be evidenced by such certificates alone, and the surrender
for transfer of any such certificate, except as otherwise provided herein, shall
also constitute the transfer of the Rights associated with the Common Stock
represented thereby. In the event that the Company purchases or otherwise
acquires any Common Stock (whether represented by Old Certificates or new
certificates of the Company) after the Merger but prior to the Distribution
Date, any Rights associated with such Common Stock shall be deemed cancelled and
retired so that the Company shall not be entitled to exercise any Rights
associated with the Common Stock which are no longer outstanding.
Notwithstanding this paragraph (c), the omission of a legend
shall not affect the enforceability of any part of this Agreement or the rights
of any holder of the Rights.
Section 4. Form of Right Certificates. The Right Certificates
(and the forms of election to purchase shares and of assignment to be printed on
the reverse thereof) shall be substantially in the form set forth in Exhibit B
hereto and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply
<PAGE> 16
13
with any applicable law or with any rule or regulation made pursuant thereto or
with any rule or regulation of the American Stock Exchange or of any other stock
exchange or automated quotation system on which the Rights may from time to time
be listed, or to conform to usage. Subject to the provisions of Sections 11, 13
and 22 hereof, the Right Certificates shall entitle the holders thereof to
purchase such number of one one-thousandths of a share of Preferred Stock as
shall be set forth therein at the price per one one-thousandth of a share of
Preferred Stock set forth therein (the "Purchase Price"), but the number of such
one one-thousandths of a share of Preferred Stock and the Purchase Price shall
be subject to adjustment as provided herein.
Section 5. Countersignature and Registration. (a) The Right
Certificates shall be executed on behalf of the Company by the Chairman of the
Board of Directors, the President, any of the Senior Vice Presidents or Vice
Presidents, the Treasurer or the Controller of the Company, either manually or
by facsimile signature, shall have affixed thereto the Company's seal or a
facsimile thereof, and shall be attested by the Secretary or an Assistant
Secretary of the Company, either manually or by facsimile signature. The Right
Certificates shall be manually countersigned by the Rights Agent and shall not
be valid for any purpose unless countersigned. In case any officer of the
Company who shall have signed any of the Right Certificates shall cease to be
such officer of the Company before countersignature by the Rights Agent and
issuance and delivery by
<PAGE> 17
14
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 Agreement any
such Person was not such an officer.
(b) Following the Distribution Date, the Rights Agent will
keep or cause to be kept, at an office or agency designated for such purpose,
books for registration and transfer of the Right Certificates issued hereunder.
Such books shall show the names and addresses of the respective holders of the
Right Certificates, the number of Rights evidenced on its face by each of the
Right Certificates and the date of each of the Right Certificates.
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(e), 11(a)(ii) and 14 hereof, at any time
after the close of business on the Distribution Date, and prior to the close of
business on the earlier of the Redemption Date or the Final Expiration Date, any
Right Certificate or Right Certificates may be transferred, split up, combined
or exchanged for another Right Certificate or Right Certificates, entitling
<PAGE> 18
15
the registered holder to purchase a like number of one one-thousandths of a
share of Preferred Stock as the Right Certificate or Right Certificates
surrendered then entitled such holder to purchase. Any registered holder
desiring to transfer, split up, combine or exchange any Right Certificate or
Right Certificates shall make such request in writing delivered to the Rights
Agent, and shall surrender the Right Certificate or Right Certificates to be
transferred, split up, combined or exchanged at the office or agency of the
Rights Agent designated for such purpose. Thereupon the Rights Agent shall
countersign and deliver to the Person entitled thereto a Right Certificate or
Right Certificates, as the case may be, as so requested. The Company may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer, split up, combination or exchange of
Right Certificates.
(b) Subject to the provisions of Section 11(a)(ii) hereof, at
any time after the Distribution Date and prior to the close of business on the
earlier of the Redemption Date or the Final Expiration Date, upon receipt by the
Company and the Rights Agent of evidence reasonably satisfactory to them of the
loss, theft, destruction or mutilation of a Right Certificate, and, in case of
loss, theft or destruction, of indemnity or security reasonably satisfactory to
them, and, at the Company's request, reimbursement to the Company and the Rights
Agent of all reasonable expenses incidental thereto, and upon surrender to the
Rights Agent and cancellation of the Right Certificate if
<PAGE> 19
16
mutilated, the Company will make and deliver a new Right Certificate of like
tenor to the Rights Agent for delivery to the registered holder in lieu of the
Right Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights, Purchase Price; Expiration Date
of Rights. (a) Except as otherwise provided herein, the Rights shall become
exercisable on the Distribution Date, and thereafter the registered holder of
any Right Certificate may, subject to Section 11(a)(ii) hereof and except as
otherwise provided herein, exercise the Rights evidenced thereby in whole or in
part 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 agency of the Rights Agent designated for such purpose, together with
payment of the Purchase Price for each one one-thousandth of a share of
Preferred Stock as to which the Rights are exercised, at any time which is both
after the Distribution Date and prior to the earliest of (i) the close of
business on January 30, 2007 (the "Final Expiration Date"), (ii) the time at
which the Rights are redeemed as provided in Section 23 hereof (the "Redemption
Date") or (iii) the time at which such Rights are exchanged as provided in
Section 24 hereof.
(b) The Purchase Price shall be initially $125 for each one
one-thousandth of a share of Preferred Stock purchasable upon the exercise of a
Right. The Purchase Price and the number of one one-thousandths of a share of
Preferred Stock or other securities or property to be acquired upon exercise of
a Right
<PAGE> 20
17
shall be subject to adjustment from time to time as provided in Sections 11 and
13 hereof and shall be payable in lawful money of the United States of America
in accordance with paragraph (c) of this Section 7.
(c) Except as otherwise provided herein, upon receipt of a
Right Certificate representing exercisable Rights, with the form of election to
purchase duly executed, accompanied by payment of the aggregate Purchase Price
for the shares of Preferred Stock to be purchased and an amount equal to any
applicable transfer tax required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof, in cash or by certified check,
cashier's check or money order payable to the order of the Company, the Rights
Agent shall thereupon promptly (i) (A) requisition from any transfer agent of
the Preferred Stock certificates for the number of shares of Preferred Stock to
be purchased and the Company hereby irrevocably authorizes its transfer agent to
comply with all such requests, or (B) requisition from the depositary agent
depositary receipts representing interests in such number of one one-thousandths
of a share of Preferred Stock as are to be purchased (in which case certificates
for the Preferred Stock represented by such receipts shall be deposited by the
transfer agent with the depositary agent) and the Company hereby directs the
depositary agent to comply with such request, (ii) when appropriate, requisition
from the Company the amount of cash to be paid in lieu of issuance of fractional
shares in accordance with Section 14 hereof, (iii) promptly after receipt of
such certificates or depositary
<PAGE> 21
18
receipts, cause the same to be delivered to or upon the order of the registered
holder of such Right Certificate, registered in such name or names as may be
designated by such holder and (iv) when appropriate, after receipt, promptly
deliver such cash to or upon the order of the registered holder of such Right
Certificate.
(d) Except as otherwise provided herein, in case the
registered holder of any Right Certificate shall exercise less than all the
Rights evidenced thereby, a new Right Certificate evidencing Rights equivalent
to the exercisable Rights remaining unexercised shall be issued by the Rights
Agent to the registered holder of such Right Certificate or to his duly
authorized assigns, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder of Rights upon the
occurrence of any purported transfer or exercise of Rights pursuant to Section 6
hereof or this Section 7 unless such registered holder shall have (i) completed
and signed the certificate contained in the form of assignment or election to
purchase set forth on the reverse side of the Rights Certificate surrendered for
such transfer or exercise and (ii) provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) thereof as the
Company shall reasonably request.
Section 8. Cancellation and Destruction of Right Certificates.
All Right Certificates surrendered for the purpose
<PAGE> 22
19
of exercise, transfer, split up, combination or exchange shall, if surrendered
to the Company or to any of its agents, be delivered to the Rights Agent for
cancellation or in cancelled form, or, if surrendered to the Rights Agent, shall
be cancelled by it, and no Right Certificates shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this Agreement. The
Company shall deliver to the Rights Agent for cancellation and retirement, and
the Rights Agent shall so cancel and retire, any other Right Certificate
purchased or acquired by the Company otherwise than upon the exercise thereof.
The Rights Agent shall deliver all 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. Availability of Shares of Preferred Stock.
(a) The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued shares of
Preferred Stock or any shares of Preferred Stock held in its treasury, the
number of shares of Preferred Stock that will be sufficient to permit the
exercise in full of all outstanding Rights.
(b) So long as the shares of Preferred Stock (and, following
the time that a Person becomes an Acquiring Person, shares of Common Stock and
other securities) issuable upon the exercise of Rights may be listed or admitted
to trading on the American Stock Exchange, the New York Stock Exchange or listed
on any other national securities exchange or quotation system, the
<PAGE> 23
20
Company shall use its best efforts to cause, from and after such time as the
Rights become exercisable, all shares reserved for such issuance to be listed or
admitted to trading on the American Stock Exchange, the New York Stock Exchange
or listed on any other exchange or quotation system upon official notice of
issuance upon such exercise.
(c) From and after such time as the Rights become exercisable,
the Company shall use its best efforts, if then necessary to permit the issuance
of shares of Preferred Stock (and following the time that a Person first becomes
an Acquiring Person, shares of Common Stock and other securities) upon the
exercise of Rights, to register and qualify such shares of Preferred Stock (and
following the time that a Person first becomes an Acquiring Person, shares of
Common Stock and other securities) under the Securities Act and any applicable
state securities or "Blue Sky" laws (to the extent exemptions therefrom are not
available), cause such registration statement and qualifications to become
effective as soon as possible after such filing and keep such registration and
qualifications effective until the earlier of the date as of which the Rights
are no longer exercisable for such securities and the Final Expiration Date. The
Company may temporarily suspend, for a period of time not to exceed 90 days, the
exercisability of the Rights in order to prepare and file a registration
statement under the Securities Act and 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
<PAGE> 24
21
well as a public announcement at such time as the suspension is no longer in
effect. Notwithstanding any provision of this Agreement to the contrary, the
Rights shall not be exercisable in any jurisdiction unless the requisite
qualification in such jurisdiction shall have been obtained and until a
registration statement under the Securities Act (if required) shall have been
declared effective.
(d) The Company covenants and agrees that it will take all
such action as may be necessary to ensure that all shares of Preferred Stock
(and, following the time that a Person becomes an Acquiring Person, shares of
Common Stock and other securities) delivered upon exercise of Rights shall, at
the time of delivery of the certificates therefor (subject to payment of the
Purchase Price), be duly and validly authorized and issued and fully paid and
nonassessable shares.
(e) The Company further covenants and agrees that it will pay
when due and payable any and all federal and state transfer taxes and charges
which may be payable in respect of the issuance or delivery of the Right
Certificates or of any shares of Preferred Stock (or shares of Common Stock or
other securities) upon the exercise of Rights. The Company shall not, however,
be required to pay any transfer tax which may be payable in respect of any
transfer or delivery of Right Certificates to a Person other than, or the
issuance or delivery of certificates or depositary receipts for the Preferred
Stock (or shares of Common Stock or other securities) in a name other than that
of, the registered holder of the Right Certificate evidencing Rights
<PAGE> 25
22
surrendered for exercise or to issue or deliver any certificates or depositary
receipts for Preferred Stock (or shares of Common Stock or other securities)
upon the exercise of any Rights until any such tax shall have been paid (any
such tax being payable by that holder of such Right Certificate at the time of
surrender) or until it has been established to the Company's reasonable
satisfaction that no such tax is due.
Section 10. Preferred Stock Record Date. Each Person in whose
name any certificate for Preferred Stock is issued upon the exercise of Rights
shall for all purposes be deemed to have become the holder of record of the
shares of Preferred Stock represented thereby on, and such certificate shall be
dated, the date upon which the Right Certificate evidencing such Rights was duly
surrendered and payment of the Purchase Price (and any applicable transfer
taxes) was made; provided, however, that if the date of such surrender and
payment is a date upon which the Preferred Stock transfer books of the Company
are closed, such Person shall be deemed to have become the record holder of such
shares on, and such certificate shall be dated, the next succeeding Business Day
on which the Preferred Stock transfer books of the Company are open. Prior to
the exercise of the Rights evidenced thereby, the holder of a Right Certificate
shall not be entitled to any rights of a holder of Preferred Stock for which the
Rights shall be exercisable, including, without limitation, the right to vote or
to receive dividends or other distributions, and shall not be entitled to
receive any notice of any proceedings of the Company, except as provided herein.
<PAGE> 26
23
Section 11. Adjustment of Purchase Price, Number of Shares and
Number of Rights. The Purchase Price, the number of shares of Preferred Stock or
other securities or property purchasable 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 the Company shall at any time after the
date of this Agreement (A) declare a dividend on the Preferred
Stock payable in shares of Preferred Stock, (B) subdivide the
outstanding Preferred Stock, (C) combine the outstanding
Preferred Stock into a smaller number of Preferred Stock or
(D) issue any shares of its capital stock in a
reclassification of the Preferred Stock (including any such
reclassification in connection with a consolidation or merger
in which the Company is the continuing or surviving
corporation), except as otherwise provided in this Section
11(a), the Purchase Price in effect at the time of the record
date for such dividend or of the effective date of such
subdivision, combination or reclassification, and the number
and kind of shares of capital stock issuable on such date,
shall be proportionately adjusted so that the holder of any
Right exercised after such time shall be entitled to receive
the aggregate number and kind of shares of capital stock
which, if such Right had been exercised immediately prior to
such date and at a time when the
<PAGE> 27
24
Preferred Stock transfer books of the Company were open, the
holder would have owned upon such exercise and been entitled
to receive by virtue of such dividend, subdivision,
combination or reclassification; provided, however, that in no
event shall the consideration to be paid upon the exercise of
one Right be less than the aggregate par value of the shares
of capital stock of the Company issuable upon exercise of one
Right.
(ii) Subject to Section 24 of this Agreement and
except as otherwise provided in this Section 11(a)(ii), in the
event that any Person becomes an Acquiring Person, then (A)
the Purchase Price shall be adjusted to be the Purchase Price
in effect immediately prior to such Person becoming an
Acquiring Person multiplied by the number of one
one-thousandths of a share of Preferred Stock for which a
Right was exercisable immediately prior to such Person
becoming an Acquiring Person, whether or not such Right was
then exercisable, and (B) each holder of a Right, except as
otherwise provided in this Section 11(a)(ii) and Subsection
11(a)(iii), hereof, shall thereafter have the right to
receive, upon exercise at a price equal to the Purchase Price
(as so adjusted), in accordance with the terms of this
Agreement and in lieu of shares of Preferred Stock, such
number of shares of Common Stock (or at the option of the
Company, such number of one one-
<PAGE> 28
25
thousandths of shares of Preferred Stock) as shall equal the
result obtained by (x) multiplying the then current Purchase
Price by the number of one one-thousandths of a share of
Preferred Stock for which a Right is then exercisable and
dividing that product by (y) 50% of the then current per share
market price of the Company's Common Stock (determined
pursuant to Section 11(d) hereof) on the date such Person
became an Acquiring Person; provided, however, that the
Purchase Price and the number of shares of Common Stock so
receivable upon exercise of a Right shall thereafter be
subject to further adjustment as appropriate in accordance
with Section 11(f) hereof. Notwithstanding anything in this
Agreement to the contrary, however, from and after the time
(the "invalidation time") when any Person first becomes an
Acquiring Person, any Rights that are beneficially owned by
(x) any Acquiring Person (or any Affiliate or Associate of any
Acquiring Person), (y) a transferee of any Acquiring Person
(or any such Affiliate or Associate) who becomes a transferee
after the invalidation time or (z) a transferee of any
Acquiring Person (or any such Affiliate or Associate) who
became a transferee prior to or concurrently with the
invalidation time pursuant to either (I) a transfer from the
Acquiring Person to holders of its equity securities or to any
Person with whom it has any continuing agreement, arrangement
or
<PAGE> 29
26
understanding regarding the transferred Rights or (II) a
transfer which the Board of Directors has determined is part
of a plan, arrangement or understanding which has the purpose
or effect of avoiding the provisions of this paragraph, and
subsequent transferees of such Persons, shall be void without
any further action and any holder of such Rights shall
thereafter have no rights whatsoever with respect to such
Rights under any provision of this Agreement. The Company
shall use all reasonable efforts to ensure that the provisions
of this Section 11(a)(ii) are complied with, but shall have no
liability to any holder of Right Certificates or other Person
as a result of its failure to make any determinations with
respect to an Acquiring Person or its Affiliates, Associates
or transferees hereunder. From and after the invalidation
time, no Right Certificate shall be issued pursuant to Section
3 or Section 6 hereof that represents Rights that are or have
become void pursuant to the provisions of this paragraph, and
any Right Certificate delivered to the Rights Agent that
represents Rights that are or have become void pursuant to the
provisions of this paragraph shall be cancelled. From and
after the occurrence of an event specified in Section 13(a)
hereof, any Rights that theretofore have not been exercised
pursuant to this Section 11(a)(ii) shall
<PAGE> 30
27
thereafter be exercisable only in accordance with Section 13
and not pursuant to this Section 11(a)(ii).
(iii) The Company may at its option substitute for a
share of Common Stock issuable upon the exercise of Rights in
accordance with the foregoing subparagraph (ii) such number or
fractions of shares of Preferred Stock having an aggregate
current market value equal to the current per share market
price of a share of Common Stock. In the event that there
shall not be sufficient shares of Common Stock issued but not
outstanding or authorized but unissued to permit the exercise
in full of the Rights in accordance with the foregoing
subparagraph (ii), the Board of Directors shall, to the extent
permitted by applicable law and any material agreements then
in effect to which the Company is a party (A) determine the
excess of (1) the value of the shares of Common Stock issuable
upon the exercise of a Right in accordance with the foregoing
subparagraph (ii) (the "Current Value") over (2) the then
current Purchase Price multiplied by the number of one one-
thousandths of shares of Preferred Stock for which a Right was
exercisable immediately prior to the time that the Acquiring
Person became such (such excess, the "Spread"), and (B) with
respect to each Right (other than Rights which have become
void pursuant to Section 11(a)(ii)), make adequate provision
to substitute for the shares of Common Stock issuable in
accordance with
<PAGE> 31
28
subparagraph (ii) upon exercise of the Right and payment of
the applicable Purchase Price, (1) cash, (2) a reduction in
the Purchase Price, (3) shares of Preferred Stock or other
equity securities of the Company (including, without
limitation, shares or fractions of shares of preferred stock
which, by virtue of having dividend, voting and liquidation
rights substantially comparable to those of the shares of
Common Stock, are deemed in good faith by the Board of
Directors to have substantially the same value as the shares
of Common Stock (such shares of preferred stock and shares or
fractions of shares of preferred stock are hereinafter
referred to as "Common Stock equivalents")), (4) debt
securities of the Company, (5) other assets, or (6) any
combination of the foregoing, having a value which, when added
to the value of the shares of Common Stock actually issued
upon exercise of such Right, shall have an aggregate value
equal to the Current Value (less the amount of any reduction
in the Purchase Price), where such aggregate value has been
determined by the Board of Directors upon the advice of a
nationally recognized investment banking firm selected in good
faith by the Board of Directors; provided, however, if the
Company shall not make adequate provision to deliver value
pursuant to clause (B) above within thirty (30) days following
the date that the Acquiring Person became such (the "Section
<PAGE> 32
29
11(a)(ii) Trigger Date"), then the Company shall be obligated
to deliver, to the extent permitted by applicable law and any
material agreements then in effect to which the Company is a
party, upon the surrender for exercise of a Right and without
requiring payment of the Purchase Price, shares of Common
Stock (to the extent available), and then, if necessary, such
number or fractions of shares of Preferred Stock (to the
extent available) and then, if necessary, cash, which shares
and/or cash have an aggregate value equal to the Spread. If,
upon the date any Person becomes an Acquiring Person, the
Board of Directors shall determine in good faith that it is
likely that sufficient additional shares of Common Stock could
be authorized for issuance upon exercise in full of the
Rights, then, if the Board of Directors so elects, the thirty
(30) day period set forth above may be extended to the extent
necessary, but not more than ninety (90) days after the
Section 11(a)(ii) Trigger Date, in order that the Company may
seek stockholder approval for the authorization of such
additional shares (such thirty (30) day period, as it may be
extended, is herein called the "Substitution Period"). To the
extent that the Company determines that some action need be
taken pursuant to the second and/or third sentence of this
Section 11(a)(iii), the Company (x) shall provide, subject to
Section 11(a)(ii) hereof and the last
<PAGE> 33
30
sentence of this Section 11(a)(iii) hereof, that such action
shall apply uniformly to all outstanding Rights and (y) may
suspend the exercisability of the Rights until the expiration
of the Substitution Period in order to seek any authorization
of additional shares and/or to decide the appropriate form of
distribution to be made pursuant to such second sentence and
to determine the value thereof. In the event of 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. For
purposes of this Section 11(a)(iii), the value of the shares
of Common Stock shall be the current per share market price
(as determined pursuant to Section 11(d)(i)) on the Section
11(a)(ii) Trigger Date and the per share or fractional value
of any "Common Stock equivalent" shall be deemed to equal the
current per share market price of the Common Stock. The Board
of Directors of the Company may, but shall not be required to,
establish procedures to allocate the right to receive shares
of Common Stock upon the exercise of the Rights among holders
of Rights pursuant to this Section 11(a)(iii).
(b) In case the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of Preferred
Stock entitling them (for a period expiring
<PAGE> 34
31
within 45 calendar days after such record date) to subscribe for or
purchase Preferred Stock (or shares having similar rights, privileges
and preferences as the Preferred Stock ("equivalent preferred shares"))
or securities convertible into Preferred Stock or equivalent preferred
shares at a price per share of Preferred Stock or equivalent preferred
shares (or having a conversion price per share, if a security
convertible into shares of Preferred Stock or equivalent preferred
shares) less than the then current per share market price of the
Preferred Stock (determined pursuant to Section 11(d) hereof) on such
record date, the Purchase Price to be in effect after such record date
shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of
which shall be the number of shares of Preferred Stock and equivalent
preferred shares outstanding on such record date plus the number of
shares of Preferred Stock and equivalent preferred shares which the
aggregate offering price of the total number of shares of Preferred
Stock and/or equivalent preferred shares so to be offered (and/or the
aggregate initial conversion price of the convertible securities so to
be offered) would purchase at such current market price, and the
denominator of which shall be the number of shares of Preferred Stock
and equivalent preferred shares outstanding on such record date plus
the number of additional shares of Preferred Stock and/or equivalent
preferred shares to be offered for subscription
<PAGE> 35
32
or purchase (or into which the convertible securities so to be offered
are initially convertible); provided, however, that in no event shall
the consideration to be paid upon the exercise of one Right be less
than the aggregate par value of the shares of capital stock of the
Company issuable upon exercise of one Right. In case such subscription
price may be paid in 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. Shares of Preferred Stock and equivalent preferred 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 case the Company shall fix a record date for the making
of a distribution to all holders of the Preferred Stock (including any
such distribution made in connection with a consolidation or merger in
which the Company is the continuing or surviving corporation) of
evidences of indebtedness or assets (other than a regular quarterly
cash dividend or a dividend payable in Preferred Stock) or subscription
rights or warrants (excluding those referred to
<PAGE> 36
33
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 then current per share market price of
the Preferred Stock (determined pursuant to Section 11(d) hereof) on
such record date, less the fair market value (as determined in good
faith by the Board of Directors of the Company whose determination
shall be described in a statement filed with the Rights Agent) of the
portion of the assets or evidences of indebtedness so to be distributed
or of such subscription rights or warrants applicable to one share of
Preferred Stock, and the denominator of which shall be such current per
share market price (determined pursuant to Section 11(d) hereof) of the
Preferred Stock; provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right be less than
the aggregate par value of the shares of capital stock of the Company
to be issued upon exercise of one Right. Such adjustments shall be made
successively whenever such a record date is fixed; and in the event
that such distribution is not so made, the Purchase Price shall again
be adjusted to be the Purchase Price which would then be in effect if
such record date had not been fixed.
(d) (i) Except as otherwise provided herein, for the purpose
of any computation hereunder, the "current per share market price" of
any security (a "Security" for the purpose
<PAGE> 37
34
of this Section 11(d)(i)) on any date shall be deemed to be the average
of the daily closing prices per share of such Security for the 30
consecutive Trading Days (as such term is hereinafter defined)
immediately prior to such date; provided, however, that in the event
that the current per share market price of the Security is determined
during a period following the announcement by the issuer of such
Security of (A) a dividend or distribution on such Security payable in
shares of such Security or securities convertible into such shares, or
(B) any subdivision, combination or reclassification of such Security,
and prior to the expiration of 30 Trading Days after the ex-dividend
date for such dividend or distribution, or the record date for such
subdivision, combination or reclassification, then, and in each such
case, the current per share market price shall be appropriately
adjusted to reflect the current market price per share equivalent of
such Security. 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 by the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the
American Stock Exchange, the New York Stock Exchange or, if the
Security is not listed or admitted to trading on the American Stock
Exchange, the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to
<PAGE> 38
35
securities listed on the principal national securities exchange on
which the Security is listed or admitted to trading or, if the Security
is not listed or admitted to trading on any national securities
exchange, the last quoted price or, if not so quoted, the average of
the high bid and low asked prices in the over-the-counter market, as
reported by NASDAQ or such other system then in use, or, if on any such
date the Security is not quoted by any such organization, the average
of the closing bid and asked prices as furnished by a professional
market maker making a market in the Security selected by the Board of
Directors of the Company. The term "Trading Day" shall mean a day on
which the principal national securities exchange on which the Security
is listed or admitted to trading is open for the transaction of
business or, if the Security is not listed or admitted to trading on
any national securities exchange, a Business Day.
(ii) For the purpose of any computation hereunder, if the
Preferred Stock is publicly traded, the "current per share market
price" of the Preferred Stock shall be determined in accordance with
the method set forth in Section 11(d)(i). If the Preferred Stock is not
publicly traded but the Common Stock is publicly traded, the "current
per share market price" of the Preferred Stock shall be conclusively
deemed to be the current per share market price of the Common Stock as
determined pursuant to Section 11(d)(i) multiplied by one thousand
(appropriately adjusted
<PAGE> 39
36
to reflect any stock split, stock dividend or similar transaction
occurring after the date hereof). If neither the Common Stock nor the
Preferred Stock is publicly traded, "current per share market price"
shall mean the fair value per share as determined in good faith by the
Board of Directors of the Company, whose determination shall be
described in a statement filed with the Rights Agent.
(e) No adjustment in the Purchase Price shall be required
unless such adjustment would require an increase or decrease of at
least 1% in the Purchase Price; provided, however, that any adjustments
which by reason of this Section 11(e) are not required to be made shall
be carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 11 shall be made to the nearest
cent or to the nearest one ten-thousandth of a share of Preferred Stock
or share of Common Stock or other share or 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 or (ii) the date of the expiration of the
right to exercise any Rights.
(f) If as a result of an adjustment made pursuant to Section
11(a) hereof, the holder of any Right thereafter exercised shall become
entitled to receive any shares of capital stock of the Company other
than the Preferred Stock, thereafter the Purchase Price and the number
of such other
<PAGE> 40
37
shares so receivable upon exercise of a 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
Preferred Stock contained in Sections 11(a), 11(b), 11(c), 11(e),
11(h), 11(i) and 11(m) and the provisions of Sections 7, 9, 10, 13 and
14 hereof with respect to the Preferred Stock shall apply on like terms
to any such other shares.
(g) All Rights originally issued by the Company subsequent to
any adjustment made to the Purchase Price hereunder shall evidence the
right to purchase, at the adjusted Purchase Price, the number of one
one-thousandths of a share of Preferred Stock purchasable from time to
time hereunder upon exercise of the Rights, all subject to further
adjustment as provided herein.
(h) Unless the Company shall have exercised its election as
provided in Section 11(i), upon each adjustment of the Purchase Price
as a result of the calculations made in Sections 11(b) and (c), each
Right outstanding immediately prior to the making of such adjustment
shall thereafter evidence the right to purchase, at the adjusted
Purchase Price, that number of one one-thousandths of a share of
Preferred Stock (calculated to the nearest one ten-thousandth of a
share of Preferred Stock) obtained by (i) multiplying (x) the number of
one one-thousandths of a share covered by a Right immediately prior to
such adjustment by (y) the Purchase Price in effect immediately prior
to such
<PAGE> 41
38
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 one one-thousandths of
a share of Preferred Stock purchasable upon the exercise of a Right.
Each of the Rights outstanding after such adjustment of the number of
Rights shall be exercisable for the number of one one-thousandths of a
share of Preferred Stock for which a Right was exercisable immediately
prior to such adjustment. Each Right held of record prior to such
adjustment of the number of Rights shall become that number of Rights
(calculated to the nearest one ten-thousandth) obtained by dividing the
Purchase Price in effect immediately prior to adjustment of the
Purchase Price by the Purchase Price in effect immediately after
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 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
<PAGE> 42
39
Section 11(i), the Company may, as promptly as practicable, cause to be
distributed to holders of record of Right Certificates on such record
date Right Certificates evidencing, subject to Section 14 hereof, the
additional Rights to which such holders shall be entitled as a result
of such adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and replacement
for the Right Certificates held by such holders prior to the date of
adjustment, and upon surrender thereof, if required by the Company, new
Right Certificates evidencing all the Rights to which such holders
shall be entitled after such adjustment. Right Certificates so to be
distributed shall be issued, executed and countersigned in the manner
provided for herein and shall be registered in the names of the holders
of record of Right Certificates on the record date specified in the
public announcement.
(j) Irrespective of any adjustment or change in the Purchase
Price or the number of one one-thousandths of a share of Preferred
Stock issuable upon the exercise of the Rights, the Right Certificates
theretofore and thereafter issued may continue to express the Purchase
Price and the number of one one-thousandths of a share of Preferred
Stock which were expressed in the initial Right Certificates issued
hereunder.
(k) Before taking any action that would cause an adjustment
reducing the Purchase Price below the then par
<PAGE> 43
40
value, if any, of the Preferred Stock or other shares of capital stock
issuable upon exercise of the Rights, the Company shall take any
corporate action which may, in the opinion of its counsel, be necessary
in order that the Company may validly and legally issue fully paid and
nonassessable shares of Preferred Stock or other such shares at such
adjusted Purchase Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date
for a specified event, the Company may elect to defer until the
occurrence of such event the issuing to the holder of any Right
exercised after such record date of the Preferred Stock and other
capital stock or securities of the Company, if any, issuable upon such
exercise over and above the Preferred Stock and other capital stock or
securities of the Company, if any, issuable upon such exercise on the
basis of the Purchase Price in effect prior to such adjustment;
provided, however, that the Company shall deliver to such holder a due
bill or other appropriate instrument evidencing such holder's right to
receive such additional shares upon the occurrence of the event
requiring such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such reductions
in the Purchase Price, in addition to those adjustments expressly
required by this Section 11, as and to the extent that it in its sole
discretion shall determine to
<PAGE> 44
41
be advisable in order that any consolidation or subdivision of the
Preferred Stock, issuance wholly for cash of any shares of Preferred
Stock at less than the current market price, issuance wholly for cash
or Preferred Stock or securities which by their terms are convertible
into or exchangeable for Preferred Stock, dividends on Preferred Stock
payable in shares of Preferred Stock or issuance of rights, options or
warrants referred to hereinabove in Section 11(b), hereafter made by
the Company to holders of its Preferred Stock shall not be taxable to
such stockholders.
(n) Anything in this Agreement to the contrary
notwithstanding, in the event that at any time after the date of this
Agreement and prior to the Distribution Date, the Company shall (i)
declare or pay any dividend on the Common Stock payable in Common Stock
or (ii) effect a subdivision, combination or consolidation of the
Common Stock (by reclassification or otherwise than by payment of a
dividend payable in Common Stock) into a greater or lesser number of
Common Stock, then in any such case, the number of Rights associated
with each share of Common Stock then outstanding, or issued or
delivered thereafter, shall be proportionately adjusted so that the
number of Rights thereafter associated with each share of Common Stock
following any such event shall equal the result obtained by multiplying
the number of Rights associated with each share of Common Stock
immediately prior to such event by a
<PAGE> 45
42
fraction the numerator of which shall be the total number of shares of
Common Stock outstanding immediately prior to the occurrence of the
event and the denominator of which shall be the total number of shares
of Common Stock outstanding immediately following the occurrence of
such event.
(o) The Company agrees that, after the earlier of the
Distribution Date or the Stock Acquisition Date, it will not, except as
permitted by Sections 23, 24 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 diminish substantially
or eliminate the benefits intended to be afforded by the Rights.
Section 12. Certificate of Adjusted Purchase Price or Number
of Shares. Whenever an adjustment is made as provided in Section 11 or 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 Stock
or the Preferred Stock a copy of such certificate and (c) mail a brief summary
thereof to each holder of a Right Certificate in accordance with Section 25
hereof (if so required under Section 25 hereof). The Rights Agent shall be fully
protected in relying on any such certificate and on any adjustment therein
contained and shall not be deemed to have knowledge of any such adjustment
unless and until it shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer
of Assets or Earnings Power. (a) In the event, directly or
<PAGE> 46
43
indirectly, at any time after any Person has become an Acquiring Person, (i) the
Company shall merge with and into any other Person, (ii) any Person shall
consolidate with the Company, or any Person shall merge with and into the
Company and the Company shall be the continuing or surviving corporation of such
merger and, in connection with such merger, all or part of the Common Stock
shall be changed into or exchanged for stock or other securities of any other
Person (or of the Company) or cash or any other property, or (iii) the Company
shall sell or otherwise transfer (or one or more of its Subsidiaries shall sell
or otherwise transfer), in one or more transactions, assets or earning power
aggregating 50% or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person (other than the Company or
one or more of its wholly-owned Subsidiaries), then upon the first occurrence of
such event, proper provision shall be made so that: (A) each holder of record of
a Right (other than Rights which have become void pursuant to Section 11(a)(ii))
shall thereafter have the right to receive, upon the exercise thereof at a price
equal to the then current Purchase Price multiplied by the number of one
one-thousandths of a share of Preferred Stock for which a Right was exercisable
(whether or not such Right was then exercisable) immediately prior to the time
that any Person first became an Acquiring Person (each as subsequently adjusted
thereafter pursuant to Sections 11(a)(i), 11(b), 11(c), 11(h), 11(i) and 11(m)),
in accordance with the terms of this Agreement and in lieu of Preferred Stock,
such number of validly issued, fully
<PAGE> 47
44
paid and non-assessable and freely tradeable shares of Common Stock of the
Principal Party (as defined herein) not subject to any liens, encumbrances,
rights of first refusal or other adverse claims, as shall be equal to the result
obtained by (1) multiplying the then current Purchase Price by the number of one
one-thousandths of a share of Preferred Stock for which a Right was exercisable
immediately prior to the time that any Person first became an Acquiring Person
(as subsequently adjusted thereafter pursuant to Sections 11(a)(i), 11(b),
11(c), 11(h), 11(i) and 11(m)) and (2) dividing that product by 50% of the then
current per share market price of the Common Stock of such Principal Party
(determined pursuant to Section 11(d)(i) hereof) on the date of consummation of
such consolidation, merger, sale or transfer; provided that the Purchase Price
and the number of shares of Common Stock of such Principal Party issuable upon
exercise of each Right shall be further adjusted as provided in Section 11(f) of
this Agreement to reflect any events occurring in respect of such Principal
Party after the date of the such consolidation, merger, sale or transfer; (B)
such Principal Party shall thereafter be liable for, and shall assume, by virtue
of such consolidation, merger, sale or transfer, all the obligations and duties
of the Company pursuant to this Agreement; (C) the term "Company" shall
thereafter be deemed to refer to such Principal Party; and (D) such Principal
Party shall take such steps (including, but not limited to, the reservation of a
sufficient number of its shares of Common Stock in accordance with Section 9
hereof) in connection with such consummation of
<PAGE> 48
45
any such transaction as may be necessary to assure that the provisions hereof
shall thereafter be applicable, as nearly as reasonably may be, in relation to
the shares of its Common Stock thereafter deliverable upon the exercise of the
Rights; provided that, upon the subsequent occurrence of any consolidation,
merger, sale or transfer of assets or other extraordinary transaction in respect
of such Principal Party, each holder of a Right shall thereupon be entitled to
receive, upon exercise of a Right and payment of the Purchase Price as provided
in this Section 13(a), such cash, shares, rights, warrants and other property
which such holder would have been entitled to receive had such holder, at the
time of such transaction, owned the Common Stock of the Principal Party
receivable upon the exercise of a Right pursuant to this Section 13(a), and such
Principal Party shall take such steps (including, but not limited to,
reservation of shares of stock) as may be necessary to permit the subsequent
exercise of the Rights in accordance with the terms hereof for such cash,
shares, rights, warrants and other property.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in (i)
or (ii) of the first sentence of Section 13(a) hereof: (A) the Person
that is the issuer of the securities into which the shares of Common
Stock are converted in such merger or consolidation, or, if there is
more than one such issuer, the issuer the shares of Common Stock of
which have the greatest aggregate market value of shares outstanding,
<PAGE> 49
46
or (B) if no securities are so issued, (x) the Person that is the other
party to the merger, if such Person survives said merger, or, if there
is more than one such Person, the Person the shares of Common Stock of
which have the greatest aggregate market value of shares outstanding or
(y) if the Person that is the other party to the merger does not
survive the merger, the Person that does survive the merger (including
the Company if it survives) or (z) the Person resulting from the
consolidation; and
(ii) in the case of any transaction described in
(iii) of the first sentence in Section 13(a) hereof, the Person that is
the party receiving the greatest portion of the assets or earning power
transferred pursuant to such transaction or transactions, or, if each
Person that is a party to such transaction or transactions receives the
same portion of the assets or earning power so transferred or if the
Person receiving the greatest portion of the assets or earning power
cannot be determined, whichever of such Persons as is the issuer of
Common Stock having the greatest aggregate market value of shares
outstanding;
provided, however, that in any such case described in the foregoing clause
(b)(i) or (b)(ii), if the Common Stock of such Person is not at such time or has
not been continuously over the preceding 12-month period registered under
Section 12 of the Exchange Act, then (1) if such Person is a direct or indirect
Subsidiary of another Person the Common Stock of which is and has been so
registered, the term "Principal Party" shall refer to
<PAGE> 50
47
such other Person, or (2) if such Person is a Subsidiary, directly or
indirectly, of more than one Person, and the Common Stocks of all of such
persons have been so registered, the term "Principal Party" shall refer to
whichever of such Persons is the issuer of Common Stock having the greatest
aggregate market value of shares outstanding, or (3) if such Person is owned,
directly or indirectly, by a joint venture formed by two or more Persons that
are not owned, directly or indirectly, by the same Person, the rules set forth
in clauses (1) and (2) above shall apply to each of the owners having an
interest in the venture as if the Person owned by the joint venture was a
Subsidiary of both or all of such joint venturers, and the Principal Party in
each such case shall bear the obligations set forth in this Section 13 in the
same ratio as its interest in such Person bears to the total of such interests.
(c) The Company shall not consummate any consolidation,
merger, sale or transfer referred to in Section 13(a) hereof unless prior
thereto the Company and the Principal Party involved therein shall have executed
and delivered to the Rights Agent an agreement confirming that the requirements
of Sections 13(a) and (b) hereof shall promptly be performed in accordance with
their terms and that such consolidation, merger, sale or transfer of assets
shall not result in a default by the Principal Party under this Agreement as the
same shall have been assumed by the Principal Party pursuant to Sections 13(a)
and (b) hereof and providing that, as soon as practicable after executing
<PAGE> 51
48
such agreement pursuant to this Section 13, the Principal Party
will:
(i) prepare and file a registration statement under
the Securities Act, if necessary, with respect to the Rights and the
securities purchasable upon exercise of the Rights on an appropriate
form, use its best efforts to cause such registration statement to
become effective as soon as practicable after such filing and use its
best efforts to cause such registration statement to remain effective
(with a prospectus at all times meeting the requirements of the
Securities Act) until the Final Expiration Date, and similarly comply
with applicable state securities laws;
(ii) use its best efforts, if the Common Stock of the
Principal Party shall be listed or admitted to trading on the American
Stock Exchange, the New York Stock Exchange or on another national
securities exchange, to list or admit to trading (or continue the
listing of) the Rights and the securities purchasable upon exercise of
the Rights on the American Stock Exchange, the New York Stock Exchange
or such securities exchange, or, if the Common Stock of the Principal
Party shall not be listed or admitted to trading on the American Stock
Exchange, the New York Stock Exchange or a national securities
exchange, to cause the Rights and the securities receivable upon
exercise of the Rights to be reported by such other system then in use;
(iii) deliver to holders of the Rights historical
financial statements for the Principal Party which comply in
<PAGE> 52
49
all respects with the requirements for registration on Form
10 (or any successor form) under the Exchange Act; and
(iv) obtain waivers of any rights of first refusal or
preemptive rights in respect of the Common Stock of the Principal Party
subject to purchase upon exercise of outstanding Rights.
(d) In case the Principal Party has provision in any of its
authorized securities or in its certificate of incorporation or by-laws or other
instrument governing its corporate affairs, which provision would have the
effect of (i) causing such Principal Party to issue (other than to holders of
Rights pursuant to this Section 13), in connection with, or as a consequence of,
the consummation of a transaction referred to in this Section 13, shares of
Common Stock of such Principal Party at less than the then current market price
per share thereof (determined pursuant to Section 11(d) hereof) or securities
exercisable for, or convertible into, Common Stock of such Principal Party at
less than such then current market price, or (ii) providing for any special
payment, tax or similar provision in connection with the issuance of the Common
Stock of such Principal Party pursuant to the provisions of Section 13, then, in
such event, the Company hereby agrees with each holder of Rights that it shall
not consummate any such transaction unless prior thereto the Company and such
Principal Party shall have executed and delivered to the Rights Agent a
supplemental agreement providing that the provision in question of such
Principal Party shall have been cancelled, waived or amended, or
<PAGE> 53
50
that the authorized securities shall be redeemed, so that the applicable
provision will have no effect in connection with, or as a consequence of, the
consummation of the proposed transaction.
(e) The Company covenants and agrees that it shall not, at any
time after a Person first becomes an Acquiring Person enter into any transaction
of the type contemplated by (i) - (iii) of Section 13(a) hereof if (x) at the
time of or immediately after such consolidation, merger, sale, transfer or other
transaction there are any rights, warrants or other instruments or securities
outstanding or agreements in effect which would substantially diminish or
otherwise eliminate the benefits intended to be afforded by the Rights, (y)
prior to, simultaneously with or immediately after such consolidation, merger,
sale, transfer of other transaction, the stockholders of the Person who
constitutes, or would constitute, the Principal Party for purposes of Section
13(a) hereof shall have received a distribution of Rights previously owned by
such Person or any of its Affiliates or Associates or (z) the form or nature of
organization of the Principal Party would preclude or limit the exercisability
of the Rights.
Section 14. Fractional Rights and Fractional Shares. (a) The
Company shall not be required to issue fractions of Rights or to distribute
Right Certificates which evidence fractional Rights (except prior to the
Distribution Date in accordance with Section 11(n) hereof). In lieu of such
fractional Rights, there shall be paid to the registered holders
<PAGE> 54
51
of the Right Certificates with regard to which such fractional Rights would
otherwise be issuable, an amount in cash equal to the same fraction of the
current market value of a whole Right. For the purposes of this Section 14(a),
the current market value of a whole Right shall be the closing price of the
Rights for the Trading Day immediately prior to the date on which such
fractional Rights would have been otherwise issuable. The closing price for any
day shall be the last sale price, regular way, or, in case no such sale takes
place on such day, the average of the closing bid and asked prices, regular way,
in either case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the American
Stock Exchange, the New York Stock Exchange or, if the Rights are not listed or
admitted to trading on the American Stock Exchange, the New York Stock Exchange,
as reported in the principal consolidated transaction reporting system with
respect to securities listed on the principal national securities exchange on
which the Rights are listed or admitted to trading or, if the Rights are not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by NASDAQ or such other
system then in use or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights selected by the Board of
Directors of the Company. If on any such date no
<PAGE> 55
52
such market maker is making a market in the Rights, the fair value of the Rights
on such date as determined in good faith by the Board of Directors of the
Company shall be used.
(b) The Company shall not be required to issue fractions of
Preferred Stock (other than fractions which are integral multiples of one
one-thousandth of a share of Preferred Stock) upon exercise of the Rights or to
distribute certificates which evidence fractional shares of Preferred Stock
(other than fractions which are integral multiples of one one-thousandth of a
share of Preferred Stock). Interests in fractions of Preferred Stock in integral
multiples of one one-thousandth of a share of Preferred Stock may, at the
election of the Company, be evidenced by depositary receipts, pursuant to an
appropriate agreement between the Company and a depositary selected by it;
provided, that such agreement shall provide that the holders of such depositary
receipts shall have all the rights, privileges and preferences to which they are
entitled as beneficial owners of the Preferred Stock represented by such
depositary receipts. In lieu of fractional shares of Preferred Stock that are
not integral multiples of one one-thousandth of a share of Preferred Stock, the
Company shall pay to the registered holders of Right Certificates at the time
such Rights are exercised as herein provided an amount in cash equal to the same
fraction of the current market value of one share of Preferred Stock. For the
purposes of this Section 14(b), the current market value of a share of Preferred
Stock shall be the closing price of a share of Preferred Stock (as determined
pursuant to Section 11(d)(i)
<PAGE> 56
53
hereof) for the Trading Day immediately prior to the date of such
exercise.
(c) The Company shall not be required to issue fractions of
shares of Common Stock or to distribute certificates which evidence fractional
shares of Common Stock upon the exercise or exchange of Rights. In lieu of such
fractional shares of Common Stock, the Company shall pay to the registered
holders of the Right Certificates with regard to which such fractional shares of
Common Stock would otherwise be issuable an amount in cash equal to the same
fraction of the current market value of a whole share of Common Stock (as
determined in accordance with Section 14(a) hereof) for the Trading Day
immediately prior to the date of such exercise or exchange.
(d) The holder of a Right by the acceptance of the Right
expressly waives his right to receive any fractional Rights or any fractional
shares upon exercise of a Right (except as provided above).
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 Stock); and any registered holder of any Right Certificate (or,
prior to the Distribution Date, of the Common Stock), without the consent of the
Rights Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Stock), on his own behalf and for his own
benefit, may
<PAGE> 57
54
enforce, and may institute and maintain any suit, action or proceeding against
the Company to enforce, or otherwise act in respect of, his right to exercise
the Rights evidenced by such Right Certificate (or, prior to the Distribution
Date, such Common Stock) in the manner provided in such Right Certificate and in
this Agreement. Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the holders of Rights
would not have an adequate remedy at law for any breach of this Agreement and
will be entitled to specific performance of the obligations under, and
injunctive relief against actual or threatened violations of, the obligations of
any Person subject to this Agreement.
Section 16. Agreement of Right Holders. Every holder of a
Right, by accepting the same, consents and agrees with the Company and the
Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common Stock;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if
surrendered at the office or agency of the Rights Agent designated for
such purpose, duly endorsed or accompanied by a proper instrument of
transfer; and
(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 Common Stock
<PAGE> 58
55
certificate) is registered as the absolute owner thereof and of the
Rights evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the Common Stock certificate made
by anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent shall be
affected by any notice to the contrary.
Section 17. Right Certificate Holder Not Deemed a Stockholder.
No holder, as such, of any Right Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of the Preferred Stock or any
other securities of the Company which may at any time be issuable on the
exercise of the Rights represented thereby, nor shall anything contained herein
or in any Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in this Agreement), or to receive dividends or
subscription rights, or otherwise, until the Rights evidenced by such Right
Certificate shall have been exercised in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent. (a) The Company
agrees to pay to the Rights Agent reasonable compensation for all services
rendered by it hereunder and, from time to time,
<PAGE> 59
56
on demand of the Rights Agent, its reasonable expenses and counsel fees and
other disbursements incurred in the administration and execution of this
Agreement and the exercise and performance of its duties hereunder. The Company
also agrees to indemnify the Rights Agent for, and to hold it harmless against,
any loss, liability or expense, incurred without negligence, bad faith or
willful misconduct on the part of the Rights Agent, 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 for the Preferred Stock or Common Stock or for other
securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document believed by it to be genuine
and to be signed, executed and, where necessary, verified or acknowledged, by
the proper Person or Persons, or otherwise upon the advice of counsel as set
forth in Section 20 hereof.
Section 19. Merger or Consolidation or Change of Name of
Rights Agent. (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
<PAGE> 60
57
merger or consolidation to which the Rights Agent or any successor Rights Agent
shall be a party, or any corporation succeeding to the stock transfer or
corporate trust powers of the Rights Agent or any successor Rights Agent, shall
be the successor to the Rights Agent under this Agreement without the execution
or filing of any paper or any further act on the part of any of the parties
hereto; provided, that such corporation would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21 hereof. In case at the
time such successor Rights Agent shall succeed to the agency created by this
Agreement, any of the Right Certificates shall have been countersigned but not
delivered, any such successor Rights Agent may adopt the countersignature of the
predecessor Rights Agent and deliver such Right Certificates so countersigned;
and in case at that time any of the Right Certificates shall not have been
countersigned, any successor Rights Agent may countersign such Right
Certificates 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
<PAGE> 61
58
its prior name or in its changed name and in all such cases such Right
Certificates shall have the full force provided in the Right Certificates and in
this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this Agreement upon the
following terms and conditions, by all of which the Company and the holders of
Right Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may
be legal counsel for the Company), and the opinion of such counsel
shall be full and complete authorization and protection to the Rights
Agent as to any action taken or omitted by it in good faith and in
accordance with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that
any fact or matter be proved or established by the Company prior to
taking or suffering any action hereunder, such fact or matter (unless
other evidence in respect thereof be herein specifically prescribed)
may be deemed to be conclusively proved and established by a
certificate signed by any one of the Chairman of the Board of
Directors, the President, any Senior Vice President or Vice President,
the Treasurer, the Controller or the Secretary of the Company and
delivered to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken or suffered in
good faith
<PAGE> 62
59
by it under the provisions of this Agreement in reliance
upon such certificate.
(c) The Rights Agent shall be liable hereunder to the Company
and any other Person only for its own negligence, bad faith or wilful
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 hereof by the Rights Agent) or in
respect of the validity or execution of any Right Certificate (except
its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this
Agreement or in any Right Certificate; nor shall it be responsible for
any change in the exercisability of the Rights (including the Rights
becoming void pursuant to Section 11(a)(ii) hereof) or any adjustment
in the terms of the Rights (including the manner, method or amount
thereof) provided for in Sections 3, 11, 13, 23 and 24, or the
ascertaining of the existence of facts that would require any such
change or adjustment (except with respect to the exercise of Rights
evidenced by Right Certificates
<PAGE> 63
60
after receipt of a certificate furnished pursuant to Section 12,
describing such change or adjustment); nor shall it by any act
hereunder be deemed to make any representation or warranty as to the
authorization or reservation of any shares of Preferred Stock or other
securities to be issued pursuant to this Agreement or any Right
Certificate or as to whether any shares of Preferred 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 person reasonably believed by the Rights Agent to be
one of the Chairman of the Board of Directors, the President, the Chief
Financial Officer, any Senior Vice President or Vice President or the
Secretary of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable
for any action taken or suffered by it in good faith in accordance with
instructions of any such officer or for any delay in acting while
waiting for those instructions. Any application by the Rights Agent for
<PAGE> 64
61
written instructions from the Company may, at the option of the Rights
Agent, set forth in writing any action proposed to be taken or omitted
by the Rights Agent under this Agreement and the date on and/or after
which such action shall be taken or such omission shall be effective.
The Rights Agent shall not be liable for any action taken by, or
omission of, the Rights Agent in accordance with a proposal included in
any such application on or after the date specified in such application
(which date shall not be less than five Business Days after the date
any officer of the Company actually receives such application, unless
any such officer shall have consented in writing to an earlier date)
unless, prior to taking any such action (or the effective date in the
case of an omission), the Rights Agent shall have received written
instructions in response to such application specifying the action to
be taken or omitted.
(h) The Rights Agent and any stockholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights
or other securities of the Company or become pecuniarily interested in
any transaction in which the Company may be interested, or contract
with or lend money to the Company or otherwise act as fully and freely
as though it were not Rights Agent under this Agreement. Nothing herein
shall preclude the Rights Agent from acting in any other capacity for
the Company or for any other legal entity.
<PAGE> 65
62
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder
either itself or by or through its attorneys or agents, and the Rights
Agent shall not be answerable or accountable for any act, default,
neglect or misconduct of any such attorneys or agents or for any loss
to the Company resulting from any such act, default, neglect or
misconduct, provided reasonable care was exercised in the selection and
continued employment thereof.
(j) If, with respect to any Rights Certificate surrendered to
the Rights Agent for exercise or transfer, the certificate contained in
the form of assignment or the form of election to purchase set forth on
the reverse thereof, as the case may be, has not been completed to
certify the holder is not an Acquiring Person (or an Affiliate or
Associate thereof), the Rights Agent shall not take any further action
with respect to such requested exercise or transfer without first
consulting with the Company.
Section 21. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties under this
Agreement upon 30 days' notice in writing mailed to the Company and to each
transfer agent of the Common Stock or Preferred Stock by registered or certified
mail, and, following the Distribution Date, to the holders of the Right
Certificates by first-class mail. The Company may remove the Rights Agent or any
successor Rights Agent upon 30 days' notice
<PAGE> 66
63
in writing, mailed to the Rights Agent or successor Rights Agent, as the case
may be, and to each transfer agent of the Common Stock or Preferred Stock by
registered or certified mail, and, following the Distribution Date, to the
holders of the Right Certificates by first-class mail. If the Rights Agent shall
resign or be removed or shall otherwise become incapable of acting, the Company
shall appoint a successor to the Rights Agent. If the Company shall fail to make
such appointment within a period of 30 days after giving notice of such removal
or after it has been notified in writing of such resignation or incapacity by
the resigning or incapacitated Rights Agent or by the holder of a Right
Certificate (who shall, with such notice, submit his Right Certificate for
inspection by the Company), then the registered holder of any Right Certificate
may apply to any court of competent jurisdiction for the appointment of a new
Rights Agent. Any successor Rights Agent, whether appointed by the Company or by
such a court, shall be a corporation organized and doing business under the laws
of the United States or any State thereof, which is authorized under such laws
to exercise corporate trust or stock transfer powers and is subject to
supervision or examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined capital and surplus of at
least $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
<PAGE> 67
64
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 Stock or Preferred Stock, and, following
the Distribution Date, mail a notice thereof in writing to the registered
holders of the Right Certificates. Failure to give any notice provided for in
this Section 21, however, or any defect therein, shall not affect the legality
or validity of the resignation or removal of the Rights Agent or the appointment
of the successor Rights Agent, as the case may be.
Section 22. Issuance of New Right Certificates.
Notwithstanding any of the provisions of this Agreement or of the Rights to the
contrary, the Company may, at its option, issue new Right Certificates
evidencing Rights in such forms as may be approved by its Board of Directors to
reflect any adjustment or change in the Purchase Price and the number or kind or
class of shares or other securities or property purchasable under the Right
Certificates made in accordance with the provisions of this Agreement. In
addition, in connection with the issuance or sale of Common Stock following the
Distribution Date and prior to the earlier of the Redemption Date and the Final
Expiration Date, the Company may with respect to shares of Common Stock so
issued or sold pursuant to (i) the exercise of stock options, (ii) under any
employee plan or arrangement, (iii) upon the exercise, conversion or exchange of
securities, notes or debentures issued
<PAGE> 68
65
by the Company or (iv) a contractual obligation of the Company in each case
existing prior to the Distribution Date, issue Rights Certificates representing
the appropriate number of Rights in connection with such issuance or sale.
Section 23. Redemption. (a) The Board of Directors of the
Company may, at any time prior to such time as any Person first becomes an
Acquiring Person, redeem all but not less than all the then outstanding Rights
at a redemption price of $.01 per Right, appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring after the date
hereof (the redemption price being hereinafter referred to as the "Redemption
Price"). The redemption of the Rights may be made effective at such time, on
such basis and with such conditions as the Board of Directors in its sole
discretion may establish. The Company may, at its option, pay the Redemption
Price in cash, shares of Common Stock (based on the current market price of the
Common Stock at the time of redemption) or any other form of consideration
deemed appropriate by the Board of Directors.
(b) Immediately upon the action of the Board of Directors
ordering the redemption of the Rights pursuant to paragraph (a) of this Section
23 (or at such later time as the Board of Directors may establish for the
effectiveness of such redemption), and without any further action and without
any notice, the right to exercise the Rights will terminate and the only right
thereafter of the holders of Rights shall be to receive the Redemption Price.
The Company shall promptly give public notice of any such redemption; provided,
however, that the
<PAGE> 69
66
failure to give, or any defect in, any such notice shall not affect the validity
of such redemption. Within 10 days after such action of the Board of Directors
ordering the redemption of the Rights (or such later time as the Board of
Directors may establish for the effectiveness of such redemption), the Company
shall mail a notice of redemption to all the holders of the then outstanding
Rights at their last addresses as they appear upon the registry books of the
Rights Agent or, prior to the Distribution Date, on the registry books of the
transfer agent for the Common Stock. Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the holder receives the
notice. Each such notice of redemption shall state the method by which the
payment of the Redemption Price will be made.
Section 24. Exchange. (a) The Board of Directors of the
Company may, at its option, at any time after any Person first becomes an
Acquiring Person, exchange all or part of the then outstanding and exercisable
Rights (which shall not include Rights that have not become effective or that
have become void pursuant to the provisions of Section 11(a)(ii) hereof) for
shares of Common Stock at an exchange ratio of one share of Common Stock per
Right, appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such amount per Right being
hereinafter referred to as the "Exchange Ratio"). Notwithstanding the foregoing,
the Board of Directors shall not be empowered to effect such exchange at any
time after (1) any Person (other than
<PAGE> 70
67
an Exempt Person), together with all Affiliates and Associates of such Person,
becomes the Beneficial Owner of shares of Common Stock aggregating 50% or more
of the shares of Common Stock then outstanding or (2) the occurrence of an event
specified in Section 13(a) hereof. From and after the occurrence of an event
specified in Section 13(a) hereof, any Rights that theretofore have not been
exchanged pursuant to this Section 24(a) shall thereafter be exercisable only in
accordance with Section 13 and may not be exchanged pursuant to this Section
24(a). The exchange of the Rights by the Board of Directors may be made
effective at such time, on such basis and with such conditions as the Board of
Directors in its sole discretion may establish.
(b) Immediately upon the effectiveness of the action of the
Board of Directors of the Company ordering the exchange of any Rights pursuant
to paragraph (a) of this Section 24 and without any further action and without
any notice, the right to exercise such Rights shall terminate and the only right
thereafter of a holder of such Rights shall be to receive that number of shares
of Common Stock equal to the number of such Rights held by such holder
multiplied by the Exchange Ratio. The Company shall promptly give public notice
of any such exchange; provided, however, that the failure to give, or any defect
in, such notice shall not affect the validity of such exchange. The Company
shall promptly mail a notice of any such exchange to all of the holders of the
Rights so exchanged at their last addresses as they appear upon the registry
books of the Rights Agent. Any notice which is mailed in the manner herein
provided shall be
<PAGE> 71
68
deemed given, whether or not the holder receives the notice. Each such notice of
exchange will state the method by which the exchange of the shares of Common
Stock for Rights will be effected and, in the event of any partial exchange, the
number of Rights which will be exchanged. Any partial exchange shall be effected
pro rata based on the number of Rights (other than Rights which have become void
pursuant to the provisions of Section 11(a)(ii) hereof) held by each holder of
Rights.
(c) In the event that there shall not be sufficient shares of
Common Stock issued but not outstanding or authorized but unissued to permit any
exchange of Right as contemplated in accordance with this Section 24, the
Company may, in its discretion, take such action as may be necessary to
authorize additional shares of Common Stock for issuance upon exchange of the
Rights. In the event that the Company shall determine not to take such action or
shall, after good faith effort, be unable to take such action as may be
necessary to authorize such additional shares of Common Stock, the Company shall
substitute, to the extent of such insufficiency, for each share of Common Stock
that would otherwise be issuable upon exchange of a Right, a number of shares of
Preferred Stock or fractions thereof (or equivalent preferred shares as such
term is defined in Section 11(b)) having an aggregate current per share market
price (determined pursuant to Section 11(d) hereof) equal to the current per
share market price of one share of Common Stock (determined pursuant to Section
11(d) hereof) as of the date of issuance of such shares
<PAGE> 72
69
of Preferred Stock or fractions thereof (or equivalent preferred shares).
(d) The Company shall not, in connection with any exchange pursuant to
this Section 24, be required to issue fractions of shares of Common Stock or to
distribute certificates which evidence fractional shares of Common Stock. In
lieu of such fractional shares of Common Stock, the Company shall pay to the
registered holders of the Right Certificates with regard to which such
fractional shares of Common Stock would otherwise be issuable an amount in cash
equal to the same fraction of the current market value of a whole share of
Common Stock. For the purposes of this paragraph (d), the current market value
of a whole share of Common Stock shall be the closing price of a share of Common
Stock (as determined pursuant to the second sentence of Section 11(d)(i) hereof)
for the Trading Day immediately prior to the date of exchange pursuant to this
Section 24.
Section 25. Notice of Certain Events. (a) In case the Company
shall at any time after the earlier of the Distribution Date or the Stock
Acquisition Date propose (i) to pay any dividend payable in stock of any class
to the holders of its Preferred Stock or to make any other distribution to the
holders of its Preferred Stock (other than a regular quarterly cash dividend),
(ii) to offer to the holders of its Preferred Stock rights or warrants to
subscribe for or to purchase any additional shares of Preferred Stock or shares
of stock of any class or any other securities, rights or options, (iii) to
effect any reclassification of its Preferred Stock (other than a
<PAGE> 73
70
reclassification involving only the subdivision or combination of outstanding
Preferred Stock), (iv) to effect the liquidation, dissolution or winding up of
the Company, or (v) to declare or pay any dividend on the Common Stock payable
in Common Stock or to effect a subdivision, combination or consolidation of the
Common Stock (by reclassification or otherwise than by payment of dividends in
Common Stock), then, in each such case, the Company shall give to each holder of
a Right Certificate, in accordance with Section 26 hereof, a notice of such
proposed action, which shall specify the record date for the purposes of such
stock dividend, or distribution of rights or warrants, or the date on which such
liquidation, dissolution or winding up is to take place and the date of
participation therein by the holders of the Common Stock and/or Preferred Stock,
if any such date is to be fixed, and such notice shall be so given in the case
of any action covered by clause (i) or (ii) above at least 10 days prior to the
record date for determining holders of the Preferred Stock for purposes of such
action, and in the case of any such other action, at least 10 days prior to the
date of the taking of such proposed action or the date of participation therein
by the holders of the Common Stock and/or Preferred Stock, whichever shall be
the earlier.
(b) In case any event described in Section 11(a)(ii) or
Section 13 shall occur then the Company shall as soon as practicable thereafter
give to each holder of a Right Certificate (or if occurring prior to the
Distribution Date, the holders of the Common Stock) in accordance with Section
26 hereof, a notice
<PAGE> 74
71
of the occurrence of such event, which notice shall describe such event and the
consequences of such event to holders of Rights under Section 11(a)(ii) and
Section 13 hereof.
Section 26. Notices. Notices or demands authorized by this
Agreement to be given or made by the Rights Agent or by the holder of any Right
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:
Bowne & Co., Inc.
345 Hudson Street
New York, New York 10014
Attention: Corporate Secretary
Subject to the provisions of Section 21 hereof, any notice or demand authorized
by this Agreement to be given or made by the Company or by the holder of any
Right Certificate to or on the Rights Agent shall be sufficiently given or made
if sent by first-class mail, postage prepaid, addressed (until another address
is filed in writing with the Company) as follows:
The Bank of New York
101 Barclay Street
New York, New York 10286
Attention: Shareholders Services Division
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company.
<PAGE> 75
72
Section 27. Supplements and Amendments. Except as otherwise
provided in this Section 27, for so long as the Rights are then redeemable, the
Company may in its sole and absolute discretion, and the Rights Agent shall if
the Company so directs, supplement or amend any provision of this Agreement in
any respect without the approval of any holders of the Rights. At any time when
the Rights are no longer redeemable, except as otherwise provided in this
Section 27, the Company may, and the Rights Agent shall, if the Company so
directs, supplement or amend this Agreement without the approval of any holders
of Rights Certificates in order to (i) cure any ambiguity, (ii) correct or
supplement any provision contained herein which may be defective or inconsistent
with any other provisions herein, (iii) shorten or lengthen any time period
hereunder, or (iv) change or supplement the provisions hereunder in any manner
which the Company may deem necessary or desirable; provided that no such
supplement or amendment shall adversely affect the interests of the holders of
Rights as such (other than an Acquiring Person or an Affiliate or Associate of
an Acquiring Person), and no such amendment may cause the rights again to become
redeemable or cause the Agreement again to become amendable other than in
accordance with this sentence. Notwithstanding anything contained in this
Agreement to the contrary, no supplement or amendment shall be made which
decreases the Redemption Price. Upon the delivery of a certificate from an
appropriate officer of the Company which states that the proposed supplement or
<PAGE> 76
73
amendment is in compliance with the terms of this Section 27, the Rights Agent
shall execute such supplement or amendment.
Section 28. Successors. All the covenants and provisions of
this Agreement by or for the benefit of the Company or the Rights Agent shall
bind and inure to the benefit of their respective successors and assigns
hereunder.
Section 29. Benefits of this Agreement. Nothing in this
Agreement shall be construed to give to any Person other than the Company, the
Rights Agent and the registered holders of the Right Certificates (and, prior to
the Distribution Date, the Common Stock) any legal or equitable right, remedy or
claim under this Agreement; but this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the registered holders of
the Right Certificates (and, prior to the Distribution Date, the Common Stock).
Section 30. Determinations and Actions by the Board of
Directors. The Board of Directors of the Company shall have the exclusive power
and authority to administer this Agreement and to exercise the rights and powers
specifically granted to the Board of Directors of the Company 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 administration of this Agreement (including, without
limitation, a determination to redeem or not redeem the Rights or to amend this
Agreement). All such actions, calculations, interpretations
<PAGE> 77
74
and determinations (including, for purposes of clause (y) below, all omissions
with respect to the foregoing) that are done or made by the Board of Directors
of the Company in good faith, shall (x) be final, conclusive and binding on the
Company, the Rights Agent, the holders of the Rights, as such, and all other
parties, and (y) not subject the Board of Directors to any liability to the
holders of the Rights.
Section 31. Severability. If any term, provision, covenant or
restriction of this Agreement or applicable to 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
laws of the State of Delaware and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts to
be made and performed entirely within such State.
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
<PAGE> 78
75
for convenience only and shall not control or affect the meaning or construction
of any of the provisions hereof.
<PAGE> 79
76
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and attested, all as of the day and year first
above written.
Attest: Bowne & Co., Inc.
By /s/ Douglas F. Bauer By /s/ Denise K. Fletcher
----------------------------- --------------------------
Name: Douglas F. Bauer Name: Denise K. Fletcher
Title: Counsel and Title: Senior Vice President
Corporate Secretary and Chief Financial
Officer
Attest: The Bank of New York
By /s/ Diane M. Ajjan By /s/ John Sivertsen
----------------------------- --------------------------
Name: Diane M. Ajjan Name: John Sivertsen
Title: Assistant Vice President Title: Vice President
<PAGE> 80
Exhibit A
FORM
OF
CERTIFICATE OF DESIGNATIONS
OF
SERIES B JUNIOR PARTICIPATING PREFERRED STOCK
OF
BOWNE & CO., INC.
(Pursuant to Section 151 of the
General Corporation Law of the State of Delaware)
-------------------
Bowne & Co., Inc., a corporation organized and existing under
the General Corporation Law of the State of Delaware (hereinafter called the
"Corporation"), hereby certifies that the following resolution was duly adopted
by the Board of Directors of the Corporation as required by Section 151 of the
General Corporation Law of the State of Delaware by written consent on June 19,
1998:
RESOLVED, that pursuant to the authority granted to and vested
in the Board of Directors of the Corporation (hereinafter called the "Board of
Directors") in accordance with the provisions of the Corporation's Certificate
of Incorporation, (hereinafter called the "Certificate of Incorporation"), a
series of Preferred Stock, par value $.01 per share (the "Preferred Stock"), of
the Corporation be and hereby is created, to be designated "Series B Junior
Participating Preferred Stock" (hereinafter called "Series B Preferred Stock")
and hereby states the designation and number of shares, and fixes the adopts
these resolutions establishing the designations, number of shares, preferences,
voting powers and other rights, powers and preferences thereof, and the
restrictions and limitations thereof, as follows:
1. Amount of Designation. The number of shares constituting
the Series B Preferred Stock shall be 80,000. Such number of shares may
be increased or decreased by resolution of the Board of Directors;
provided, that no decrease shall reduce the number of shares of Series
B Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for issuance upon the
exercise of outstanding options, rights or warrants or upon the
conversion of any outstanding securities issued by the Corporation
convertible into Series B Preferred Stock.
A-1
<PAGE> 81
2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock of the Corporation (the "Preferred Stock")
(or any similar stock) ranking prior and superior to the Series B
Preferred Stock with respect to dividends, the holders of shares of
Series B Preferred Stock in preference to the holders of Common Stock
par value $.01 per share of the Corporation (the "Common Stock") and of
any other stock of the Corporation ranking junior to the Series B
Preferred Stock shall be entitled to receive, when, as and if declared
by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the last day in each
calendar quarter in each year (each such date being referred to herein
as a "Dividend Payment Date"), commencing on the first Dividend Payment
Date after the first issuance of a share or fraction of a share of
Series B Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to the greater of (x) $1 or (y) subject to the
provision for adjustment hereinafter set forth, 1,000 times the
aggregate per share amount of all cash dividends, and 1,000 times the
aggregate per share amount (payable in kind) of all non-cash dividends
or other distributions other than a dividend payable in shares of
Common Stock, declared on the Common Stock since the immediately
preceding Dividend Payment Date or, with respect to the first Dividend
Payment Date, since the first issuance of any share or fraction of a
share of Series B Preferred Stock. In the event the Corporation shall
at any time after June 19, 1998, declare or pay any dividend on the
Common Stock payable in shares of Common Stock, or effect a subdivision
or combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend
in shares of Common Stock) into a greater or lesser number of shares of
Common Stock, then in each such case the amount to which holders of
shares of Series B Preferred Stock were entitled immediately prior to
such event under clause (y) of the preceding sentence shall be adjusted
by multiplying such amount by a fraction, the numerator of which is the
number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution
on the Series B Preferred Stock as provided in paragraph (A) of this
Section immediately after it declares a dividend or distribution on the
Common Stock (other than a dividend payable in shares of Common Stock);
provided that, in the event no dividend or distribution shall have been
declared on the Common Stock during the period between any Dividend
Payment Date and the next subsequent Dividend Payment Date, a dividend
of $1 per share on the Series B
A-2
<PAGE> 82
Preferred Stock shall nevertheless be payable, when, as and if
declared, on such subsequent Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative, whether
or not earned or declared, on outstanding shares of Series B Preferred
Stock from the Dividend Payment Date next preceding the date of issue
of such shares, unless the date of issue of such shares is prior to the
record date for the first Dividend Payment Date, in which case
dividends on such shares shall begin to accrue from the date of issue
of such shares, or unless the date of issue is a Dividend Payment Date
or is a date after the record date for the determination of holders of
shares of Series B Preferred Stock entitled to receive a quarterly
dividend and before such Dividend Payment Date, in either of which
events such dividends shall begin to accrue and be cumulative from such
Dividend Payment Date. Accrued but unpaid dividends shall not bear
interest. Dividends paid on the shares of Series B Preferred Stock in
an amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding. The
Board of Directors may fix a record date for the determination of
holders of shares of Series B Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which record
date shall be not more than 60 days prior to the date fixed for the
payment thereof.
3. Voting Rights. The holders of shares of Series B Preferred
Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth and except as otherwise provided in the Certificate of
Incorporation or required by law, each share of Series B Preferred
Stock shall entitle the holder thereof to 1,000 votes on all matters
upon which the holders of the Common Stock of the Corporation are
entitled to vote. In the event the Corporation shall at any time after
June 19, 1998, declare or pay any dividend on the Common Stock payable
in shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common
Stock, then in each such case the number of votes per share to which
holders of shares of Series B Preferred Stock were entitled immediately
prior to such event shall be adjusted by multiplying such number by a
fraction, the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
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(B) Except as otherwise provided in the Certificate of
Incorporation, a Certificate of Designation, or in any amendment
creating a series of Preferred Stock or any similar stock, and except
as otherwise required by law, the holders of shares of Series B
Preferred Stock and the holders of shares of Common Stock and any other
capital stock of the Corporation having general voting rights shall
vote together as one class on all matters submitted to a vote of
shareholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by
law, holders of Series B Preferred Stock shall have no special voting
rights and their consent shall not be required (except to the extent
they are entitled to vote with holders of Common Stock as set forth
herein) for taking any corporate action.
4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series B Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not earned or declared, on
shares of Series B Preferred Stock outstanding shall have been paid in
full, the Corporation shall not:
(i) Declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (as to
dividends) to the Series B Preferred Stock;
(ii) Declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity (as
to dividends) with the Series B Preferred Stock, except
dividends paid ratably on the Series B Preferred Stock and all
such parity stock on which dividends are payable or in arrears
in proportion to the total amounts to which the holders of all
such shares are then entitled;
(iii) Redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding-up) to
the Series B Preferred Stock, provided that the Corporation
may at any time redeem, purchase or otherwise acquire shares
of any such junior stock in exchange for shares of any stock
of the Corporation ranking junior (as to dividends and upon
dissolution, liquidation or winding-up) to the Series B
Preferred Stock or rights, warrants or options to acquire such
junior stock;
(iv) Redeem or purchase or otherwise acquire for
consideration any shares of Series B Preferred Stock,
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<PAGE> 84
or any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding-up) with
the Series B Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of such
shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and
other relative rights and preferences of the respective series
and classes, shall determine in good faith will result in fair
and equitable treatment among the respective series or
classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any
shares of stock of the Corporation unless the Corporation could, under
paragraph (A) of this Section 4, purchase or otherwise acquire such
shares at such time and in such manner.
5. Reacquired Shares. Any shares of Series B Preferred Stock
purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the
acquisition thereof. All such shares shall upon their retirement become
authorized but unissued shares of Preferred Stock and may be reissued
as part of a new series of Preferred Stock to be created by resolution
or resolutions of the Board of Directors, subject to any conditions and
restrictions on issuance set forth herein.
6. Liquidation, Dissolution or Winding-Up. Upon any
liquidation, dissolution or winding-up of the Corporation, no
distribution shall be made (A) to the holders of the Common Stock or of
shares of any other stock of the Corporation ranking junior, upon
liquidation, dissolution or winding-up, to the Series B Preferred Stock
unless, prior thereto, the holders of shares of Series B Preferred
Stock shall have received $100 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not
earned or declared, to the date of such payment, provided that the
holders of shares of Series B Preferred Stock shall be entitled to
receive an aggregate amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 1,000 times the aggregate
amount to be distributed per share to holders of shares of Common
Stock, or (B) to the holders of shares of stock ranking on a parity
upon liquidation, dissolution or winding-up with the Series B Preferred
Stock, except distributions made ratably on the Series B Preferred
Stock and all such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such
liquidation, dissolution or winding-up. In the event, however, that
there are not sufficient assets available to
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<PAGE> 85
permit payment in full of the Series B liquidation preference and the
liquidation preferences of all other classes and series of stock of the
Corporation, if any, that rank on a parity with the Series B Preferred
Stock in respect thereof, then the assets available for such
distribution shall be distributed ratably to the holders of the Series
B Preferred Stock and the holders of such parity shares in the
proportion to their respective liquidation preferences. In the event
the Corporation shall at any time after June 19, 1998 declare or pay
any dividend on the Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such case the
aggregate amount to which holders of shares of Series B Preferred Stock
were entitled immediately prior to such event under the proviso in
clause (A) of the preceding sentence shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
7. Consolidation, Merger, etc. In case the Corporation shall
enter into any consolidation, merger, combination or other transaction
in which the shares of Common Stock are converted into, exchanged for
or changed into other stock or securities, cash and/or any other
property, then in any such case each share of Series B Preferred Stock
shall at the same time be similarly converted into, exchanged for or
changed into an amount per share (subject to the provision for
adjustment hereinafter set forth) equal to 1,000 times the aggregate
amount of stock, securities, cash and/or any other property (payable in
kind), as the case may be, into which or for which each share of Common
Stock is converted, exchanged or converted. In the event the
Corporation shall at any time after June 19, 1998 declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to the
conversion, exchange or change of shares of Series B Preferred Stock
shall be adjusted by multiplying such amount by a fraction, the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number
of shares of Common Stock that were outstanding immediately prior to
such event.
A-6
<PAGE> 86
8. No Redemption. The shares of Series B Preferred Stock shall
not be redeemable from any holder.
9. Rank. The Series B Preferred Stock shall rank with respect
to the payment of dividends and the distribution of assets upon
liquidation, dissolution or winding-up of the Corporation, junior to
all other series of Preferred Stock and senior to the Common Stock.
10. Amendment. If any proposed amendment to the Certificate of
Incorporation (including the adoption of any Certificate of Designation
or amendment to a Certificate of Designation) would alter, change or
repeal any of the preferences, powers or special rights given to the
Series B Preferred Stock so as to affect the Series B Preferred Stock
adversely, then the holders of the Series B Preferred Stock shall be
entitled to vote separately as a class upon such amendment, and the
affirmative vote of two-thirds of the outstanding shares of the Series
B Preferred Stock voting separately as a class, shall be necessary for
the adoption thereof, in addition to such other vote as may be required
by the General Corporation Law of the State of Delaware.
11. Fractional Shares. Series B Preferred Stock may be issued
in fractions of a share that shall entitle the holder, in proportion to
such holder's fractional shares, to exercise voting rights, receive
dividends, participate in distributions and to have the benefit of all
other rights of holders of Series B Preferred Stock.
A-7
<PAGE> 87
IN WITNESS WHEREOF, this Certificate of Designations is
executed on behalf of the Corporation by its Senior Vice President and Chief
Financial Officer and attested by its Secretary this 19th day of June, 1998.
---------------------------------
Name: Denise K. Fletcher
Title: Senior Vice President and
Chief Financial Officer
Attest:
- ------------------------------
Name: Douglas F. Bauer
Title: Secretary
A-8
<PAGE> 88
Exhibit B
Form of Right Certificate
Certificate No. R- ____ ___ Rights
NOT EXERCISABLE AFTER JANUARY 30, 2007 OR EARLIER IF REDEMPTION OR
EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.01 PER RIGHT
AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS
OWNED BY OR TRANSFERRED TO ANY PERSON WHO BECOMES AN ACQUIRING PERSON
(AS DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN TRANSFEREES THEREOF
WILL BECOME NULL AND VOID AND WILL NO LONGER BE TRANSFERABLE.
Right Certificate
Bowne & Co., 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 June 19, 1998 as the same may be amended from time to
time (the "Rights Agreement"), between Bowne & Co., Inc., a Delaware corporation
(the "Company"), and The Bank of New York (the "Rights Agent"), to purchase from
the Company at any time after the Distribution Date (as such term is defined in
the Rights Agreement) and prior to 5:00 P.M., New York City time, on January 30,
2007 at the office or agency of the Rights Agent designated for such purpose, or
of its successor as Rights Agent, one one-thousandth of a fully paid
non-assessable share of Series B Junior Participating Preferred Stock, par value
$.01 per share (the "Preferred Stock"), of the Company, at a purchase price of
$125 per one one-thousandth of a share of Preferred Stock (the "Purchase
Price"), upon presentation and surrender of this Right Certificate with the Form
of Election to Purchase duly executed. The number of Rights evidenced by this
Rights Certificate (and the number of one one-thousandths of a share of
Preferred Stock which may be purchased upon exercise hereof) set forth above,
and the Purchase Price set forth above, are the number and Purchase Price as of
June 19, 1998 based on the Preferred Stock as constituted at such date. As
provided in the Rights Agreement, the Purchase Price, the number of one
one-thousandths of a share of Preferred Stock (or other securities or property)
which may be purchased upon the exercise of the Rights and the number of Rights
evidenced by this Right Certificate are subject to modification and adjustment
upon the happening of certain events.
B-1
<PAGE> 89
This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms, provisions and
conditions are hereby incorporated herein by reference and made a part hereof
and to which Rights Agreement reference is hereby made for a full description of
the rights, limitations of rights, obligations, duties and immunities hereunder
of the Rights Agent, the Company and the holders of the Right Certificates.
Copies of the Rights Agreement are on file at the principal executive offices of
the Company and the above-mentioned office or agency of the Rights Agent. The
Company will mail to the holder of this Right Certificate a copy of the Rights
Agreement without charge after receipt of a written request therefor.
This Right Certificate, with or without other Right
Certificates, upon surrender at the office or agency of the Rights Agent
designated for such purpose, may be exchanged for another Right Certificate or
Right Certificates of like tenor and date evidencing Rights entitling the holder
to purchase a like aggregate number of shares of Preferred Stock as the Rights
evidenced by the Right Certificate or Right Certificates surrendered shall have
entitled such holder to purchase. If this Right Certificate shall be exercised
in part, the holder shall be entitled to receive upon surrender hereof another
Right Certificate or Right Certificates for the number of whole Rights not
exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Certificate (i) may be redeemed by the Company at a redemption
price of $.01 per Right or (ii) may be exchanged in whole or in part for shares
of Preferred Stock or shares of the Company's Common Stock, par value $.01 per
share.
No fractional shares of Preferred Stock or Common Stock will
be issued upon the exercise or exchange of any Right or Rights evidenced hereby
(other than fractions of Preferred Stock which are integral multiples of one
one-thousandth of a share of Preferred Stock, which may, at the election of the
Company, be evidenced by depositary receipts), but in lieu thereof a cash
payment will be made, as provided in the Rights Agreement.
No holder of this Right Certificate, as such, shall be
entitled to vote or receive dividends or be deemed for any purpose the holder of
the Preferred Stock or of any other securities of the Company which may at any
time be issuable on the exercise or exchange hereof, nor shall anything
contained in the Rights Agreement or herein be construed to confer upon the
holder hereof, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in the Rights Agreement) or to
B-2
<PAGE> 90
receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by this Right certificate shall have been exercised as provided
in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights Agent.
B-3
<PAGE> 91
WITNESS the facsimile signature of the proper officers
of the Company and its corporate seal. Dated as of _____________.
ATTEST: Bowne & Co., Inc.
By __________________ By __________________
Countersigned:
_______________________,
as Rights Agent
By _________________________
Authorized Signature
B-4
<PAGE> 92
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 transfer unto ______________________________________________________
________________________________________________________________________________
(Please print name and address of transferee)
________________________________________________________________________________
Rights represented by this Right Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and appoint
___________________ Attorney, to transfer said Rights on the books of the
within-named Company, with full power of substitution.
Dated: _________________
______________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a bank, trust company,
broker, dealer or other eligible institution participating in a recognized
signature guarantee medallion program.
________________________________________________________________________________
(To be completed)
The undersigned hereby certifies that the Rights evidenced by
this Right Certificate are not beneficially owned by, were not acquired by the
undersigned from, and are not being assigned to, an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).
___________________________
Signature
B-5
<PAGE> 93
Form of Reverse Side of Right Certificate - continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise
Rights represented by the Rights Certificate)
To Bowne & Co., Inc.:
The undersigned hereby irrevocably elects to exercise
__________________ Rights represented by this Right Certificate to purchase the
shares of Preferred Stock (or other securities or property) issuable upon the
exercise of such Rights and requests that certificates for such shares of
Preferred Stock (or such other securities) be issued in the name of:
________________________________________________________________________________
(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 delivery to:
Please insert social security
or other identifying number
________________________________________________________________________________
(Please print name and address)
________________________________________________________________________________
Dated: ____________________
________________________
Signature
(Signature must conform to holder specified on Right Certificate)
Signature Guaranteed:
Signature must be guaranteed by bank, trust company, broker,
dealer or other eligible institution participating in a recognized signature
guarantee medallion program.
B-6
<PAGE> 94
Form of Reverse Side of Right Certificate -- continued
________________________________________________________________________________
(To be completed)
The undersigned certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by, and were not acquired by the
undersigned from, an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement).
______________________
Signature
________________________________________________________________________________
NOTICE
The signature in the Form of Assignment or Form of Election to
Purchase, as the case may be, must conform to the name as written upon the face
of this Right Certificate in every particular, without alteration or enlargement
or any change whatsoever.
In the event the certification set forth above in the Form of
Assignment or the Form of Election to Purchase, as the case may be, is not
completed, such Assignment or Election to Purchase will not be honored.
B-7
<PAGE> 95
Exhibit C
UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT,
RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO BECOMES AN ACQUIRING
PERSON (AS DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN TRANSFEREES
THEREOF WILL BECOME NULL AND VOID AND WILL NO LONGER BE TRANSFERABLE.
SUMMARY OF RIGHTS TO PURCHASE
Shares of Preferred Stock
On June 19, 1998 the Board of Directors of Bowne & Co., Inc.
(the "Company") authorized and directed that one preferred share purchase right
(a "Right") be issued with each share of common stock, par value $.01 per share,
of the Company (the "Common Stock") issued in the merger (the "Merger") of Bowne
& Co., Inc., a New York corporation ("Bowne-New York") into the Company pursuant
to the Agreement and Plan of Merger, dated June 19, 1998, between the Company
and Bowne-New York. Each Right entitles the registered holder to purchase from
the Company one one-thousandth of a share of Series B Junior Participating
Preferred Stock, par value $.01 per share (the "Preferred Stock") of the Company
at a price of $125 per one one-thousandth of a share of Preferred Stock (the
"Purchase Price"), subject to adjustment. The description and terms of the
Rights are set forth in a Rights Agreement dated as of June 19, 1998, as the
same may be amended from time to time (the "Rights Agreement"), between the
Company and The Bank of New York, as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated persons (with
certain exceptions an "Acquiring Person") have acquired beneficial ownership of
20% or more of the outstanding shares of Common Stock or (ii) 10 business days
(or such later date as may be determined by action of the Board of Directors
prior to such time as any person or group of affiliated persons becomes an
Acquiring Person) following the commencement of, or announcement of an intention
to make, a tender offer or exchange offer the consummation of which would result
in the beneficial ownership by a person or group of 20% or more of the
outstanding shares of Common Stock (the earlier of such dates being called the
"Distribution Date").
The Rights Agreement provides that, until the Distribution
Date (or earlier redemption or expiration of the Rights), the Rights will be
transferred with and only with the Common Stock. Following the Merger and until
the Distribution Date (or earlier redemption or expiration of the Rights),
certificates issued by the Company representing shares of Common Stock (whether
in exchange for certificates of Bowne--New York (the "Old Certificates") or
otherwise) will contain a notation incorporating the Rights Agreement by
reference. After the Merger and until the Distribution Date (or earlier
redemption or expiration of the Rights), the Rights associated with the shares
<PAGE> 96
of Common Stock issued in the Merger and represented by Old Certificates will,
until such Old Certificates are exchanged or new certificates for Common Stock
are issued by the Company, be evidenced by such Old Certificates registered in
the names of the holders thereof together with this Summary of Rights. Until the
Distribution Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for shares of Common Stock (including
Old Certificates), even without such notation or a copy of this Summary of
Rights, will also constitute the transfer of the Rights associated with the
shares of Common Stock represented by such certificate. As soon as practicable
following the Distribution Date, separate certificates evidencing the Rights
("Right Certificates") will be mailed to holders of record of the Common Stock
as of the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on January 30, 2007 (the "Final Expiration Date"), unless
the Final Expiration Date is advanced or extended or unless the Rights are
earlier redeemed or exchanged by the Company, in each case as described below.
The Purchase Price payable, and the number of shares of
Preferred Stock or other securities or property issuable, upon exercise of the
Rights are subject to adjustment from time to time to prevent dilution (i) in
the event of a stock dividend on, or a subdivision, combination or
reclassification of, the Preferred Stock, (ii) upon the grant to holders of the
Preferred Stock of certain rights or warrants to subscribe for or purchase
Preferred Stock at a price, or securities convertible into Preferred Stock with
a conversion price, less than the then-current market price of the Preferred
Stock or (iii) upon the distribution to holders of the Preferred Stock of
evidences of indebtedness or assets (excluding regular periodic cash dividends
or dividends payable in Preferred Stock) or of subscription rights or warrants
(other than those referred to above).
The Rights are also subject to adjustment in the event of a
stock dividend on the Common Stock payable in shares of Common Stock or
subdivisions, consolidations or combinations of the Common Stock occurring, in
any such case, prior to the Distribution Date.
Shares of Preferred Stock purchasable upon exercise of the
Rights will not be redeemable. Each share of Preferred Stock will be entitled,
when, as and if declared, to a minimum preferential quarterly dividend payment
of $100 per share but will be entitled to an aggregate dividend of 1000 times
the dividend declared per share of Common Stock. In the event of liquidation,
dissolution or winding up of the Company, the holders of the Preferred Stock
will be entitled to a minimum preferential liquidation payment of $100 per share
(plus any
2
<PAGE> 97
accrued but unpaid dividends) but will be entitled to an aggregate payment of
1000 times the payment made per share of Common Stock. Each share of Preferred
Stock will have 1000 votes, voting together with the Common Stock. Finally, in
the event of any merger, consolidation or other transaction in which shares of
Common Stock are converted or exchanged, each share of Preferred Stock will be
entitled to receive 1000 times the amount received per share of Common Stock.
These rights are protected by customary antidilution provisions.
Because of the nature of the Preferred Stock's dividend,
liquidation and voting rights, the value of the one one-thousandth interest in a
share of Preferred Stock purchasable upon exercise of each Right should
approximate the value of one share of Common Stock.
In the event that any person or group of affiliated or
associated persons becomes an Acquiring Person, each holder of a Right, other
than Rights beneficially owned by the Acquiring Person (which will thereupon
become void), will thereafter have the right to receive upon exercise of a Right
and payment of the Purchase Price, that number of shares of Common Stock having
a market value of two times the Purchase Price.
In the event that, after a person or group has become an
Acquiring Person, the Company is acquired in a merger or other business
combination transaction or 50% or more of its consolidated assets or earning
power are sold, proper provision will be made so that each holder of a Right
(other than Rights beneficially owned by an Acquiring Person which will have
become void) 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 of the person with whom the Company has engaged in the foregoing
transaction (or its parent), which number of shares at the time of such
transaction will have a market value of two times the Purchase Price.
At any time after any person or group becomes an Acquiring
Person and prior to the acquisition by such person or group of 50% or more of
the outstanding shares of Common Stock or the occurrence of an event described
in the prior paragraph, the Board of Directors of the Company may exchange the
Rights (other than Rights owned by such person or group which will have become
void), in whole or in part, at an exchange ratio of one share of Common Stock,
or a fractional share of Preferred Stock (or of a share of a class or series of
the Company's preferred stock having similar rights, preferences and privileges)
of equivalent value, per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an adjustment of at least
1% in such Purchase Price. No fractional shares of Preferred Stock will be
issued (other than fractions which are integral multiples of one one-thousandth
of a share of
3
<PAGE> 98
Preferred Stock, which may, at the election of the Company, be evidenced by
depositary receipts) and in lieu thereof, an adjustment in cash will be made
based on the market price of the Preferred Stock on the last trading day prior
to the date of exercise.
At any time prior to the time an Acquiring Person becomes
such, the Board of Directors of the Company may redeem the Rights in whole, but
not in part, at a price of $.01 per Right (the "Redemption Price"). The
redemption of the Rights may be made effective at such time, on such basis and
with such conditions as the Board of Directors in its sole discretion may
establish. Immediately upon any redemption of the Rights, the right to exercise
the Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price.
For so long as the Rights are then redeemable, the Company
may, except with respect to the redemption price, amend the Rights in any
manner. After the Rights are no longer redeemable, the Company may, except with
respect to the redemption price, amend the Rights in any manner that does not
adversely affect the interests of holders of the Rights.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, including, without limitation,
the right to vote or to receive dividends.
A copy of the Rights Agreement will be 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 does not purport to be complete
and is qualified in its entirety by reference to the Rights Agreement, as the
same may be amended from time to time, which is hereby incorporated herein by
reference.
4
