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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
CABOT CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 04-2271897
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(State of incorporation or organization) (I.R.S. Employer
Identification No.)
75 State Street
Boston, Massachusetts 02109-1806
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(Address of principal executive offices) (Zip Code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange
to be so registered on which each class
- ------------------- is to be registered
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Preferred Stock Purchase Rights New York Stock Exchange
Boston Stock Exchange
Pacific Stock Exchange
If this Form relates to the registration of a class of debt securities
and is effective upon filing pursuant to General Instruction A.(c)(1), please
check the following box. / /
If this Form relates to the registration of a class of debt securities
and is to become effective simultaneously with the effectiveness of a
concurrent registration statement under the Securities Act of 1933 pursuant to
General Instruction A.(c)(2), please check the following box. / /
Securities to be registered pursuant to Section 12(g) of the Act:
None
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(Title of Class)
Page 1 of 81 Pages
Exhibit Index on Page 10
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Item 1. Description of Securities to be Registered.
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On November 10, 1995, the Board of Directors of Cabot
Corporation, a Delaware corporation (the "Corporation"), declared
a dividend distribution of one preferred share purchase right (a
"Right") for each outstanding share of Common Stock, par value
$1.00 per share (the "Common Shares"), of the Corporation. The
dividend is payable to the stockholders of record on November 24,
1995 (the "Record Date"), and with respect to Common Shares
issued thereafter until the Distribution Date (as defined below)
and, in certain circumstances, with respect to Common Shares
issued after the Distribution Date. Except as set forth below,
each Right, when it becomes exercisable, entitles the registered
holder to purchase from the Corporation one one-hundredth of a
share of Series A Junior Participating Preferred Stock, par value
$1.00 per share (the "Preferred Shares"), at a price of $200 per
one one-hundredth of a Preferred Share (the "Purchase Price")
subject to adjustment. The description and terms of the Rights
are set forth in a Rights Agreement, dated as of November 10,
1995 (the "Rights Agreement"), between the Corporation and The
First National Bank of Boston (the "Rights Agent").
Initially, the Rights will be attached to all
certificates representing Common Shares then outstanding, and no
separate Right Certificates (as hereinafter defined) will be
distributed. The Rights will separate from the Common Shares on
the close of business on the tenth day after the earlier to occur
of (i) the first date of public announcement that a person or
"group" (other than a Grandfathered Person, as hereinafter
defined) has acquired beneficial ownership of 15% or more of the
outstanding Common Shares (except pursuant to a Permitted Offer,
as hereinafter defined), or (ii) the date of commencement of, or
announcement of an intention to commence, a tender offer or
exchange offer the consummation of which would result in a person
or group becoming an Acquiring Person (as hereinafter defined)
(such tenth day being called the "Distribution Date"). A person
or group whose acquisition of Common Shares causes a Distribution
Date pursuant to clause (i) above is an "Acquiring Person." The
first date of public announcement that a person or group has
become an Acquiring Person is the "Shares Acquisition Date."
"Grandfathered Persons" include:
(a) any descendant of Godfrey L. Cabot (the
deceased founder of the Corporation), or any spouse,
widow or widower of any such descendant (any such
descendants, spouses, widows and widowers collectively
defined as the "Cabot Family Members");
(b) any trust (including any voting trust) which
is in existence on the date of this Agreement and which
has been established by Godfrey L.
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Cabot or one or more Cabot Family Members, any estate
of, or the executor or administrator of any estate of,
or any guardian or custodian for, a Cabot Family
Member who died on or before the date of this
Agreement (such trusts, estates, executors,
administrators or guardians or custodians collectively
defined as the "Cabot Family Entities");
(c) any estate of, or the executor or
administrator of any estate of, or any guardian or
custodian for, a Cabot Family Member who dies after the
date of this Agreement, or any trust established after
the date hereof by one or more Cabot Family Members or
Cabot Family Entities, provided that one or more Cabot
Family Members or Cabot Family Entities, collectively,
are the beneficiaries of at least 80% of the
actuarially-determined beneficial interests in such
estate or trust;
(d) any charitable organization which qualifies
as an exempt organization under Section 501(c) of the
Internal Revenue Code of 1986, as amended ("Charitable
Organization") which is established by one or more
Cabot Family Members or Cabot Family Entities (a "Cabot
Family Charitable Organization");
(e) any corporation of which at least 80% of the
voting power and at least 80% of the equity interest is
held, directly or indirectly, by or for the benefit of
one or more Cabot Family Members, Cabot Family
Entities, estates, executors, administrators, guardians
or custodians or trusts described in clause (c) above,
or Cabot Family Charitable Organizations; and
(f) any general partnership, limited partnership,
organization or other entity or arrangement of which at
least 80% of the voting interest and at least 80% of
the economic interest is held, directly or indirectly,
by or for the benefit of one or more Cabot Family
Members, Cabot Family Entities, estates, executors,
administrators, guardians or custodians, or trusts
described in clause (c) above, or Cabot Family
Charitable Organizations;
provided, however, that a Grandfathered Person
ceases to be a Grandfathered Person at the time that
all or any part of its interest in the Common Shares
becomes reportable on a Schedule 13D under the
Securities Exchange Act of 1934, as amended (or any
comparable or successor report) as part of a "group"
(as such term is defined or used under Rule 13d-5(b) of
the General Rules and Regulations under the Securities
Exchange Act of 1934, as amended) which beneficially
owns, directly or indirectly, 15% or more of the then
outstanding Common Shares and
Page 3 of 81 Pages
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includes one or more persons (including any affiliate
or associate thereof) who (i) are not Grandfathered
Persons and (ii) individually or in the aggregate
beneficially own, directly or indirectly, in excess of
1% of the then outstanding Common Shares.
For purposes of the definition of Grandfathered Person,
the term "descendant" shall be deemed to include adopted children
and the issue of such adopted children, including adopted issue,
provided that any such adoptee is adopted before his or her
eighteenth birthday.
The Rights Agreement provides that, until the
Distribution Date, the Rights will be transferred with and only
with the Common Shares. Until the Distribution Date (or earlier
redemption or expiration of the Rights) new Common Share
certificates issued after the Record Date upon transfer or new
issuance of Common Shares will contain a notation incorporating
the Rights Agreement by reference. Until the Distribution Date
(or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for Common Shares
outstanding as of the Record Date, even without such notation or
a copy of the Summary of Rights being attached thereto, will also
constitute the transfer of the Rights associated with the Common
Shares 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 Shares as of the close of business on the
Distribution Date (and to each initial record holder of certain
Common Shares issued after the Distribution Date), and such
separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution
Date and will expire at the close of business on November 10,
2005, unless earlier redeemed by the Corporation as described
below.
In the event that any person becomes an Acquiring
Person (except pursuant to a Permitted Offer as defined below),
or if a Section 13(a)(z) Event (as defined below) occurs, each
holder of a Right will have (subject to the terms of the Rights
Agreement) the right (the "Flip-In Right") to receive upon
exercise the number of Common Shares, or, in the discretion of
the Board of Directors, one one-hundredths of a Preferred Share
(or, in certain circumstances, other securities of the
Corporation) having a value (immediately prior to such triggering
event) equal to two times the exercise price of the Right.
Notwithstanding the foregoing, following the occurrence of an
event described above, all Rights that are, or (under certain
circumstances specified in the Rights Agreement) were,
beneficially owned by any Acquiring Person or any affiliate or
associate thereof will be null and void. A "Permitted Offer" is
a tender or exchange offer for all outstanding Common Shares
which is at a price and on terms determined, prior to the
purchase of shares under such tender or exchange offer, by the
Board of Directors to be adequate
Page 4 of 81 Pages
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(taking into account all factors that such Directors deem
relevant) and otherwise in the best interests of the Corporation,
its stockholders and its other relevant constituencies (other
than the person or any affiliate or associate thereof on whose
behalf the offer is being made) taking into account all factors
that such directors may deem relevant.
If the Corporation does not have sufficient treasury
stock or authorized and unissued Common Shares fully to honor the
Rights, holders will be entitled to purchase the maximum number
of Common Shares issuable and one one-hundredth of a Preferred
Share, and the Corporation may issue additional Common Shares or
other equity or debt securities upon exercise of the Rights. If
the Corporation is unable to make sufficient Common Shares or
other equity or debt available, the rights of holders to purchase
Common Shares may be proportionately reduced. Under certain
circumstances, the Board, at its option may also issue Common
Shares in exchange for all or part of the exercisable Rights
after the Distribution Date at the rate of one Common Share for
each Right.
In the event that, at any time following the Shares
Acquisition Date, (i) the Corporation is acquired in a merger or
other business combination transaction in which the holders of
all of the outstanding Common Shares immediately prior to the
consummation of the transaction are not the holders of all of the
surviving corporation's voting power, or (ii) (herein referred to
as a Section 13(a)(z) Event) more than 50% of the Corporation's
assets or earning power is sold or transferred, in either case
with or to an Acquiring Person or any affiliate or associate or
any other person in which such Acquiring Person, affiliate or
associate has an interest or any person acting on behalf of or in
concert with such Acquiring Person, affiliate or associate, or,
if in such transaction all holders of Common Shares are not
treated alike, any other person, then each holder of a Right
(except Rights which previously have been voided as set forth
above) shall thereafter have the right (the "Flip-Over Right") to
receive, upon exercise, common shares of the acquiring company
having a value equal to two times the exercise price of the
Right. The holder of a Right will continue to have the Flip-Over
Right whether or not such holder exercises or surrenders the Flip-
In Right.
The Purchase Price payable, and the number of one-
hundredths of a Preferred Share or other securities 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 Shares, (ii) upon the grant to holders of the Preferred
Shares of certain rights or warrants to subscribe for or purchase
Preferred Shares at a price, or securities convertible into
Preferred Shares with a conversion price, less than the then
current market price of the Preferred Shares or (iii) upon the
distribution to holders of the Preferred Shares of evidences of
indebtedness or assets (excluding regular quarterly cash
dividends) or of subscription rights or warrants (other than
those referred to above).
Page 5 of 81 Pages
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The Purchase Price is also subject to adjustment in the
event of a stock split of the Common Shares or a stock dividend
on the Common Shares payable in Common Shares or subdivisions,
consolidations or combinations of the Common Shares occurring, in
any such case, prior to the Distribution Date.
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
one-hundredths of a Preferred Share will be issued and in lieu
thereof, an adjustment in cash will be made based on the market
price of the Preferred Shares on the last trading day price to
the date of exercise.
Preferred Shares purchasable upon exercise of the
Rights will not be redeemable. Each Preferred Share will be
entitled to a minimum preferential quarterly dividend payment of
$18.00 per share but, if greater, will be entitled to an
aggregate dividend per share of 100 times the dividend declared
per Common Share. In the event of liquidation, the holders of
the Preferred Shares will be entitled to a minimum preferential
liquidation payment of $18.00 per share; thereafter, and after
the holders of the Common Shares receive a liquidation payment of
$0.18 per share, the holders of the Preferred Shares and the
holders of the Common Shares will share the remaining assets in
the ratio of one hundred to 1 (as adjusted) for each Preferred
Share and Common Share so held, respectively. Finally, in the
event of any merger, consolidation or other transaction in which
Common Shares are exchanged, each Preferred Share will be
entitled to receive one hundred times the amount received per
Common Share. These rights are protected by customary
antidilution provisions. In the event that the amount of accrued
and unpaid dividends on the Preferred Shares is equivalent to at
least six full quarterly dividends, the holders of the Preferred
Shares shall have the right, voting as a class, to elect two
directors in addition to the directors elected by the holders of
the Common Shares until all cumulative dividends on the Preferred
Shares have been paid through the last quarterly dividend payment
date or until non-cumulative dividends have been paid regularly
for at least one year.
At any time prior to the earlier to occur of (i) the
close of business on the tenth day following the Shares
Acquisition Date or (ii) the expiration of the Rights, and under
certain other circumstances, the Corporation may redeem the
Rights in whole, but not in part, at a redemption price of $.01
per Right (the "Redemption Price"). Additionally, following the
Shares Acquisition Date, the Corporation may redeem the then
outstanding Rights in whole, but not in part, at the Redemption
Price, provided that such redemption is in connection with a
merger or other business combination transaction or series of
transactions involving the Corporation in which all holders of
Common Shares are treated alike but not involving an Interested
Stockholder (as defined in the Rights Agreement).
Page 6 of 81 Pages
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All of the provisions of the Rights Agreement may be
amended by the Board of Directors of the Corporation prior to the
Distribution Date. After the Distribution Date, the provisions
of the Rights Agreement may be amended in order to cure any
ambiguity, defect or inconsistency, to make changes which do not
adversely affect the interests of holders of Rights (excluding
the interests of any Acquiring Person), or, subject to certain
limitations, to shorten or lengthen any time period under the
Rights Agreement.
Until a Right is exercised, the holder thereof, as
such, will have no rights as a stockholder of the Corporation,
including, without limitation, the right to vote or to receive
dividends. While the distribution of the Rights will not be
taxable to stockholders of the Corporation, stockholders may,
depending upon the circumstances, recognize taxable income should
the Rights become exercisable or upon the occurrence of certain
events thereafter.
As of November 1, 1995, there were 67,774,968 Common
Shares issued and outstanding, including 29,685,900 Common Shares
held in the treasury. As of November 1, 1995, there were
4,302,341 unissued Common Shares reserved for issuance under the
Corporation's employee benefit plans. Each outstanding Common
Share on the Record Date will receive one Right. As long as the
Rights are attached to the Common Shares, the Corporation will
issue one Right with each new Common Share so that all such
shares will have attached rights. 1,000,000 Preferred Shares
have been reserved for issuance upon exercise of the Rights.
The Rights have certain anti-takeover effects. The
Rights will cause substantial dilution to a person or group that
attempts to acquire the Corporation without conditioning the
offer on (i) the Rights being redeemed, (ii) a substantial number
of Rights being acquired or (iii) the offer being deemed a
"Permitted Offer" under the Rights Agreement. However, the
Rights should not interfere with any merger or other business
combination in connection with a Permitted Offer or that is
approved by the Corporation because the Rights are redeemable
under certain circumstances.
In connection with the issuance of the Rights, the
Board of Directors of the Corporation intends to redeem the
Corporation's existing preferred share purchase rights ("Old
Rights") established in December 1986. Holders of record of the
Old Rights as of the redemption date, which is also the Record
Date for the Rights, will receive a redemption payment for the
Old Rights equal to $.05 per Common Share.
Attached hereto as Exhibit 1 and incorporated herein by
reference is a copy of the Rights Agreement, dated as of November
10, 1995, between the Corporation and The First National Bank of
Boston, as Rights Agent, specifying the terms of the Rights,
including the exhibits thereto, as follows: Exhibit A -- The
Form of Right Certificate;
Page 7 of 81 Pages
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Exhibit B -- The Summary of Rights to Purchase Shares; and Exhibit C -- The
Amended Certificate of Designation, Preferences and Rights of Series A Junior
Participating Preferred Stock of Cabot Corporation. The foregoing description
of the Rights is qualified by reference to the Rights Agreement and the
exhibits thereto.
Item 2. Exhibits.
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1. Rights Agreement, dated as of November
10, 1995, between Cabot Corporation and
The First National Bank of Boston, as
Rights Agent, which includes, as
Exhibit A thereto, the Form of Right
Certificate, as Exhibit B thereto, the
Summary of Rights to Purchase Shares and
as Exhibit C thereto, the Amended
Certificate of Designation, Preferences
and Rights of Series A Junior
Participating Preferred Stock of Cabot
Corporation.
Page 8 of 81 Pages
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SIGNATURE
Pursuant to the requirements of Section 12 of the
Securities Exchange Act of 1934, the registrant has duly caused
this registration statement to be signed on its behalf by the
undersigned, thereto duly authorized.
CABOT CORPORATION
By: /s/ Kennett F. Burnes
------------------------
Name: Kennett F. Burnes
Title: President
Dated: November 13, 1995
Page 9 of 81 Pages
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EXHIBIT INDEX
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<TABLE>
<CAPTION>
Exhibit Description Page
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<S> <C> <C>
1 Rights Agreement, dated as of November 10, 11
1995, between Cabot Corporation and The
First National Bank of Boston, as Rights
Agent, which includes, as Exhibit A
thereto, the Form of Right Certificate, as
Exhibit B thereto, the Summary of Rights to
Purchase Shares and as Exhibit C thereto,
the Amended Certificate of Designation,
Preferences and Rights of Series A Junior
Participating Preferred Stock of Cabot
Corporation.
</TABLE>
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EXHIBIT 1
________________________________________________________________________________
CABOT CORPORATION
and
THE FIRST NATIONAL BANK OF BOSTON, as
Rights Agent
Rights Agreement
Dated as of November 10, 1995
________________________________________________________________________________
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<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
<S> <C>
Section 1. Certain Definitions....................... 1
Section 2. Appointment of Rights Agent............... 6
Section 3. Issue of Right Certificates............... 6
Section 4. Form of Right Certificate................. 8
Section 5. Countersignature and Registration......... 9
Section 6. Transfer, Split-Up, Combination and
Exchange of Right Certificates; Mutilated,
Destroyed, Lost or Stolen Right
Certificate............................... 9
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights................. 10
Section 8. Cancellation and Destruction of Right
Certificates.............................. 13
Section 9. Reservation and Availability of Capital
Stock..................................... 13
Section 10. Preferred Shares Record Date.............. 14
Section 11. Adjustment of Purchase Price, Number and
Kind of Shares or Number of Rights........ 15
Section 12. Certificate of Adjusted Purchase Price or
Number of Shares.......................... 22
Section 13. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power................ 23
Section 14. Fractional Rights and Fractional Shares... 26
Section 15. Rights of Action.......................... 27
Section 16. Agreement of Right Holders................ 28
Section 17. Right Certificate Holder Not Deemed a
Stockholder............................... 28
Section 18. Concerning the Rights Agent............... 29
</TABLE>
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<TABLE>
<S> <C>
Section 19. Merger or Consolidation or Change of Name
of Rights Agent................................. 29
Section 20. Duties of Rights Agent.......................... 30
Section 21. Change of Rights Agent.......................... 32
Section 22. Issuance of New Right Certificates.............. 33
Section 23. Redemption and Termination...................... 34
Section 24. Exchange........................................ 35
Section 25. Notice of Certain Events........................ 36
Section 26. Notices......................................... 37
Section 27. Supplements and Amendments...................... 38
Section 28. Determination and Actions by the Board of
Directors, etc.................................. 38
Section 29. Successors...................................... 39
Section 30. Benefits of this Agreement...................... 39
Section 31. Severability.................................... 39
Section 32. Governing Law................................... 39
Section 33. Counterparts.................................... 39
Section 34. Descriptive Headings............................ 40
Signatures ................................................ 41
</TABLE>
Exhibit A - Form of Right Certificate
Exhibit B - Summary of Rights to Purchase Shares
Exhibit C - Amended Certificate of Designation, Preferences
and Rights of Series A Junior Participating
Preferred Stock of Cabot Corporation
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<TABLE>
<CAPTION>
Defined Term Cross Reference Sheet
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<S> <C>
Acquiring Person.................................. Section 1(a)
Act............................................... Section 1(b)
Adjustment Shares................................. Section 11(a)(ii)
Adjusted Number of Shares......................... Section 11(a)(iii)
Adjusted Purchase Price........................... Section 11(a)(iii)
Affiliate......................................... Section 1(c)
Agreement......................................... Preface
Associate......................................... Section 1(c)
Beneficial Owner.................................. Section 1(d)
beneficially own.................................. Section 1(d)
Business Day...................................... Section 1(e)
Cabot Family Charitable Organization.............. Section 1(j)(iv)
Cabot Family Entities............................. Section 1(j)(ii)
Cabot Family Members.............................. Section 1(j)(i)
capital stock equivalent.......................... Section 11(a)(iii)
Charitable Organization........................... Section 1(j)(iv)
Close of Business................................. Section 1(f)
Common Shares..................................... Section 1(g)
Corporation....................................... Preface
current per share market price.................... Section 11(d)(i)
descendant........................................ Section 1(j)
Distribution Date................................. Section 1(h)
equivalent preferred shares....................... Section 11(b)
Exchange Act...................................... Section 1(c)
Exchange Ratio.................................... Section 24(a)
Final Expiration Date............................. Section 1(i)
Grandfathered Person.............................. Section 1(j)
group............................................. Section 1(j)(vi)
Interested Stockholder............................ Section 1(k)
NASDAQ............................................ Section 11(d)(i)
Permitted Offer................................... Section 1(l)
Person............................................ Section 1(m)
Preferred Shares.................................. Section 1(n)
Principal Party................................... Section 13(b)
Proration Factor.................................. Section 11(a)(iii)
Purchase Price.................................... Section 4(a)
Record Date....................................... Preface
</TABLE>
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<TABLE>
<S> <C>
Redemption Date ................................... Section 1(o)
Redemption Price .................................. Section 23(a)(i)
Right ............................................. Preface
Right Certificate ................................. Section 3(a)
Rights Agent ...................................... Preface
Rights Agreement .................................. Section 3(c)
Section 11(a)(ii) Event ........................... Section 1(p)
Section 13(a)(z) Event ............................ Section 13
Section 13 Event .................................. Section 1(q)
Security .......................................... Section 11(d)(i)
Shares Acquisition Date ........................... Section 1(r)
Subsidiary ........................................ Section 1(s)
Summary of Rights ................................. Section 3(b)
then outstanding .................................. Section 1(d)(iii)
Trading Day ....................................... Section 11(d)(i)
Triggering Event .................................. Section 1(t)
voting securities ................................. Section 13(a)
</TABLE>
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RIGHTS AGREEMENT
----------------
RIGHTS AGREEMENT, dated as of November 10, 1995 (the
"Agreement"), between CABOT CORPORATION, a Delaware corporation
(the "Corporation"), and The First National Bank of Boston (the
"Rights Agent").
The Board of Directors of the Corporation has
authorized and declared a dividend of one preferred share
purchase right (a "Right") for each Common Share (as hereinafter
defined) of the Corporation outstanding at 5:00 P.M., Eastern
Standard Time, on November 24, 1995 (the "Record Date"), each
Right representing the right to purchase one one-hundredth
(subject to adjustment as provided herein) of a Preferred Share
(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 with respect to each Common
Share that shall become outstanding between the Record Date and
the earliest of the Distribution Date, the Redemption Date or the
Final Expiration Date (as such terms are hereinafter defined);
provided, however, that Rights may be issued with respect to
Common Shares that shall become outstanding after the
Distribution Date and prior to the earlier of the Redemption Date
and the Final Expiration Date in accordance with the provisions
of Section 22 of this Agreement.
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 meanings indicated:
(a) "Acquiring Person" shall mean any Person who or
which, together with all Affiliates and Associates of such
Person, shall be the Beneficial Owner of 15% or more of the then
outstanding Common Shares (other than as a result of a Permitted
Offer) or was such a Beneficial Owner at any time after the date
hereof, whether or not such person continues to be the Beneficial
Owner of 15% or more of the then outstanding Common Shares.
Notwithstanding the foregoing, (A) the term "Acquiring Person"
shall not include (i) the Corporation, (ii) any Subsidiary of the
Corporation, (iii) any employee benefit plan of the Corporation
or of any Subsidiary of the Corporation, (iv) any Person or
entity organized, appointed or established by the Corporation for
or pursuant to the terms of any such plan acting in such
capacity, or (v) any Grandfathered Person, and (B) no Person
shall become an "Acquiring Person" (i) as a result of the
acquisition of Common Shares by the Corporation which, by
reducing the number of Common Shares outstanding, increases the
proportional number of shares beneficially owned by such Person
together with all Affiliates and Associates of such Person,
provided, that if (1) a Person would become an Acquiring Person
(but for the operation of this subclause (i)) as
<PAGE> 7
a result of the acquisition of Common Shares by the Corporation,
and (2) after such share acquisition by the Corporation, such
Person, or an Affiliate or Associate of such Person, becomes the
Beneficial Owner of any additional Common Shares, then such
Person shall be deemed an Acquiring Person; or (ii) if (1) within
five Business Days after such Person would otherwise have become
or, if such Person did so inadvertently, after such Person
discovers that such Person would otherwise have become, an
Acquiring Person (but for the operation of this subclause (ii)),
such Person notifies the Board of Directors that such Person did
so inadvertently, a (2) within two Business Days after such
notification, such Person divests itself of a sufficient number
of Common Shares so that such Person is the Beneficial Owner of
such number of Common Shares that such Person no longer would be
an Acquiring Person.
(b) "Act" shall mean the Securities Act of 1933, as
amended and as in effect on the date of this Agreement.
(c) "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the
General Rules and Regulations under the Securities Exchange Act
of 1934, as amended and as in effect on the date of this
Agreement (the "Exchange Act").
(d) A Person shall be deemed the "Beneficial Owner" of
and shall be deemed to "beneficially own" any securities:
(i) which such Person or any of such Person's
Affiliates or Associates beneficially owns, directly or
indirectly;
(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,
or upon the exercise of conversion rights, exchange rights,
rights (other than the Rights), warrants or options, or
otherwise; provided, however, that a Person shall not be deemed
the Beneficial Owner of, or to beneficially own, securities
tendered pursuant to a tender or exchange offer made by or on
behalf of such Person or any of such Person's Affiliates or
Associates until such tendered securities are accepted for
purchase or exchange; or (B) the right to vote pursuant to any
agreement, arrangement or understanding; provided, however, that
a Person shall not be deemed the Beneficial Owner of, or to
beneficially own, any security if the agreement, arrangement or
understanding to vote such security (1) arises solely from a
revocable proxy or consent given to such Person in response to a
public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations promulgated
under the Exchange Act and (2) is not also then reportable on
Schedule 13D under the Exchange Act (or any comparable or
successor report); or
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(iii) which are beneficially owned, directly or
indirectly, by any other Person (or any Affiliate or Associate
thereof) 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) relating to the acquisition,
holding, voting (except to the extent contemplated by the proviso
to Section l(d)(ii)(B)) or disposing of any securities of the
Corporation.
Notwithstanding anything in this definition of
Beneficial Ownership to the contrary, the phrase "then
outstanding," when used with reference to a Person's Beneficial
Ownership of securities of the Corporation, shall mean the number
of such securities then issued and outstanding together with the
number of such securities not then actually issued and
outstanding which such Person would be deemed to own beneficially
hereunder.
(e) "Business Day" shall mean any day other than a
Saturday, Sunday or federal holiday.
(f) "Close of Business" on any given date shall mean
5:00 P.M., Boston, Massachusetts time, on such date; provided,
however, that if such date is not a Business Day it shall mean
5:00 P.M., Boston, Massachusetts time, on the next succeeding
Business Day.
(g) "Common Shares" when used with reference to the
Corporation shall mean the shares of Common Stock, par value
$1.00 per share, of the Corporation or, in the event of a
subdivision, combination or consolidation with respect to such
shares of Common Stock, the shares of Common Stock resulting from
such subdivision, combination or consolidation. "Common Shares"
when used with reference to any Person other than the Corporation
shall mean the capital stock (or equity interest) with the
greatest combined economic and 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) "Final Expiration Date" shall have the meaning set
forth in Section 7 hereof.
(j) "Grandfathered Person" shall mean any of the
following:
(i) any descendant of Godfrey L. Cabot (the
deceased founder of the Corporation), or any spouse,
widow or widower of any such descendant
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<PAGE> 9
(any such descendants, spouses, widows and widowers
collectively defined as the "Cabot Family Members");
(ii) any trust (including any voting trust) which
is in existence on the date of this Agreement and which
has been established by Godfrey L. Cabot or one or more
Cabot Family Members, any estate of, or the executor or
administrator of any estate of, or any guardian or
custodian for, a Cabot Family Member who died on or
before the date of this Agreement (such trusts,
estates, executors, administrators or guardians or
custodians collectively defined as the "Cabot Family
Entities");
(iii) any estate of, or the executor or
administrator of any estate of, or any guardian or
custodian for, a Cabot Family Member who dies after the
date of this Agreement, or any trust established after
the date hereof by one or more Cabot Family Members or
Cabot Family Entities, provided that one or more Cabot
Family Members or Cabot Family Entities, collectively,
are the beneficiaries of at least 80% of the
actuarially-determined beneficial interests in such
estate or trust;
(iv) any charitable organization which qualifies
as an exempt organization under Section 501(c) of the
Internal Revenue Code of 1986, as amended ("Charitable
Organization") which is established by one or more
Cabot Family Members or Cabot Family Entities (a "Cabot
Family Charitable Organization");
(v) any corporation of which at least 80% of the
voting power and at least 80% of the equity interest is
held, directly or indirectly, by or for the benefit of
one or more Cabot Family Members, Cabot Family
Entities, estates, executors, administrators, guardians
or custodians or trusts described in clause (iii)
above, or Cabot Family Charitable Organizations; and
(vi) any general partnership, limited partnership,
organization or other entity or arrangement of which at
least 80% of the voting interest and at least 80% of
the economic interest is held, directly or indirectly,
by or for the benefit of one or more Cabot Family
Members, Cabot Family Entities, estates, executors,
administrators, guardians or custodians, or trusts
described in clause (iii) above, or Cabot Family
Charitable Organizations;
provided, however, that a Grandfathered Person
shall cease to be a Grandfathered Person at the time
that all or any part of its interest in the Common
Shares becomes reportable on a Schedule 13D under the
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<PAGE> 10
Exchange Act (or any comparable or successor report) as
part of a "group" (as such term is defined or used
under Rule 13d-5(b) of the General Rules and
Regulations under the Exchange Act) which beneficially
owns, directly or indirectly, 15% or more of the then
outstanding Common Shares and includes one or more
Persons (including any Affiliate or Associate thereof)
who (i) are not Grandfathered Persons and (ii)
individually or in the aggregate beneficially own,
directly or indirectly, in excess of 1% of the then
outstanding Common Shares.
For purposes of the definition of Grandfathered Person,
the term "descendant" shall be deemed to include adopted children
and the issue of such adopted children, including adopted issue,
provided that any such adoptee is adopted before his or her
eighteenth birthday.
(k) "Interested Stockholder" shall mean any Acquiring
Person or any Affiliate or Associate of an Acquiring Person or
any other Person in which any such Acquiring Person, Affiliate or
Associate has an interest which represents in excess of 5% of the
total combined economic or voting power of such person, or any
other Person acting directly or indirectly on behalf of or in
concert with any such Acquiring Person, Affiliate or Associate.
(l) "Permitted Offer" shall mean a tender or exchange
offer for all outstanding Common Shares which is at a price and
on terms determined, prior to the purchase of shares under such
tender or exchange offer, by the Board of Directors to be
adequate and otherwise in the best interests of the Corporation,
its stockholders and its other relevant constituencies (other
than the Person or any Affiliate or Associate thereof on whose
behalf the offer is being made) taking into account all factors
that such Directors may deem relevant.
(m) "Person" shall mean any individual, firm,
partnership, corporation, trust, association, joint venture or
other entity, and shall include any successor (by merger or
otherwise) of such entity.
(n) "Preferred Shares" shall mean shares of Series A
Junior Participating Preferred Stock, with a par value of $1.00
per share, of the Corporation having the relative rights,
preferences and limitations set forth in the Form of Amended
Certificate of Designation, Preferences and Rights attached to
this Agreement as Exhibit C.
(o) "Redemption Date" shall have the meaning set forth
in Section 7 hereof.
(p) "Section 11(a)(ii) Event" shall mean any event
described in Section 11(a)(ii) hereof.
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(q) "Section 13 Event" shall mean any event described
in clause (x), (y) or (z) of Section 13(a) hereof.
(r) "Shares 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 the Exchange Act) by the Corporation or an Acquiring
Person that an Acquiring Person has become such.
(s) "Subsidiary" of any Person shall mean any
corporation or other Person of which a majority of the voting
power of the voting equity securities or equity interest is
owned, directly or indirectly, by such Person.
(t) "Triggering Event" shall mean any Section
11(a)(ii) Event or any Section 13 Event.
Section 2. APPOINTMENT OF RIGHTS AGENT. The
Corporation hereby appoints the Rights Agent to act as agent for
the Corporation 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 Shares) in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such
appointment. The Corporation 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 close of business on the tenth day after the earlier to occur
of (i) the Shares Acquisition Date or (ii) the date of the
commencement by any Person (other than the Corporation, any
Subsidiary of the Corporation, any employee benefit plan of the
Corporation or of any Subsidiary of the Corporation or any Person
or entity organized, appointed or established by the Corporation
for or pursuant to the terms of any such plan) of, or of the
first public announcement of the intention of any Person (other
than the Corporation, any Subsidiary of the Corporation, any
employee benefit plan of the Corporation or of any Subsidiary of
the Corporation or any Person or entity organized, appointed or
established by the Corporation for or pursuant to the terms of
any such plan) to commence (which intention to commence remains
in effect for five Business Days after such announcement), a
tender or exchange offer the consummation of which would result
in any Person becoming an Acquiring Person (including, in the
case of both (i) and (ii), any such date which is after the date
of this Agreement and prior to the issuance of the Rights), such
tenth day 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 Shares
registered in the names of the holders thereof (which
certificates shall also be deemed to be Right Certificates) and
not by separate Right Certificates, and (y) the right to receive
Right Certificates will be transferable only in connection with
the transfer of the underlying Common Shares (including a
transfer to the Corporation); provided, however, that if a
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<PAGE> 12
tender offer prior to the occurrence of a Distribution Date is
terminated, then no Distribution Date shall occur as a result of
such tender offer. As soon as practicable after the Distribution
Date, the Corporation will prepare and execute, the Rights Agent
will countersign, and the Corporation will send or cause to be
sent by first-class, postage-prepaid mail, to each record holder
of Common Shares as of the close of business on the Distribution
Date, at the address of such holder shown on the records of the
Corporation, a Right Certificate, in substantially the form of
Exhibit A hereto (a "Right Certificate"), evidencing one Right
for each Common Share so held. As of and after the Distribution
Date, the Rights will be evidenced solely by such Right
Certificates.
(b) As promptly as practicable following the Record
Date, the Corporation will send a copy of a Summary of Rights to
Purchase Shares, in substantially the form of Exhibit B hereto
(the "Summary of Rights"), by first-class, postage-prepaid mail,
to each record holder of Common Shares as of the close of
business on the Record Date, at the address of such holder shown
on the records of the Corporation. With respect to certificates
for Common Shares outstanding as of the Record Date, until the
Distribution Date, the Rights will be evidenced by such
certificates registered in the names of the holders thereof
together with a copy of the Summary of Rights attached thereto.
Until the Distribution Date (or the earlier of the Redemption
Date or the Final Expiration Date), the surrender for transfer of
any certificate for Common Shares outstanding on the Record Date,
with or without a copy of the Summary of Rights attached thereto,
shall also constitute the transfer of the Rights associated with
such Common Shares.
(c) Certificates for Common Shares which become
outstanding (including, without limitation, reacquired Common
Shares referred to in the last sentence of this paragraph (c))
after the Record Date but prior to the earliest of the
Distribution Date, the Redemption Date or the Final Expiration
Date shall be deemed also to be certificates for Rights and shall
bear the following legend:
This certificate also evidences and
entitles the holder hereof to certain
rights as set forth in a Rights
Agreement between Cabot Corporation and
The First National Bank of Boston, dated
as of November 10, 1995 (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 Cabot
Corporation. 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. Cabot Corporation will
mail to the holder of this certificate a
copy of the
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Rights Agreement without charge after
receipt of a written request therefor
from such holder. Under certain
circumstances set forth in the Rights
Agreement, Rights issued to, or held
by, any Person who is, was or
becomes an Acquiring Person or an
Affiliate or Associate thereof (as
defined in the Rights Agreement) and
certain related persons, whether
currently held by or on behalf of such
Person or by any subsequent holder, may
become null and void.
With respect to such certificates containing the foregoing
legend, until the Distribution Date, the Rights associated with
the Common Shares represented by such certificates shall be
evidenced by such certificates alone, and the surrender for
transfer of any such certificate shall also constitute the
transfer of the Rights associated with the Common Shares
represented thereby. In the event that the Corporation purchases
or acquires any Common Shares after the Record Date but prior to
the Distribution Date, any Rights associated with such Common
Shares shall be deemed cancelled and retired so that the
Corporation shall not be entitled to exercise any Rights
associated with the Common Shares which are no longer
outstanding.
Section 4. FORM OF RIGHT CERTIFICATE. (a) The Right
Certificates (and the forms of election to purchase and of
assignment to be printed on the reverse thereof) shall be
substantially in the form set forth in Exhibit A hereto and may
have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the
Corporation may deem appropriate and as are not inconsistent with
the provisions of this Agreement, or as may be required to comply
with any applicable law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any stock
exchange on which the Rights may from time to time be listed, or
to conform to usage. Subject to the provisions of Section 11 and
Section 22 hereof, the Right Certificates shall entitle the
holders thereof to purchase such number of one one-hundredths of
a Preferred Share as shall be set forth therein at the price per
one one-hundredth of a Preferred Share set forth therein (the
"Purchase Price"), but the amount and type of securities
purchasable upon the exercise of each Right and the Purchase
Price thereof shall be subject to adjustment as provided herein.
(b) Any Right Certificate issued pursuant to Section
3(a) or Section 22 hereof that represents Rights which are null
and void pursuant to Section 7(e) of this Agreement and any Right
Certificate issued pursuant to Section 6 or Section 11 hereof
upon transfer, exchange, replacement or adjustment of any other
Right Certificate referred to in this sentence, shall contain (to
the extent feasible) the following legend:
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<PAGE> 14
The Rights represented by this Right
Certificate are or were beneficially
owned by a Person who was or became an
Acquiring Person or an Affiliate or
Associate of an Acquiring Person (as
such terms are defined in the Rights
Agreement). Accordingly, this Right
Certificate and the Rights represented
hereby are null and void.
Provisions of Section 7(e) of this Rights Agreement shall be
operative whether or not the foregoing legend is contained on any
such Right Certificate.
Section 5. COUNTERSIGNATURE AND REGISTRATION. The
Right Certificates shall be executed on behalf of the Corporation
by its Chairman of the Board, its President, any of its Vice
Presidents, or its Treasurer, either manually or by facsimile
signature, shall have affixed thereto the Corporation's seal or a
facsimile thereof, and shall be attested by the Secretary or an
Assistant Secretary of the Corporation, either manually or by
facsimile signature. The Right Certificates shall be
countersigned by the Rights Agent and shall not be valid for any
purpose unless so countersigned. In case any officer of the
Corporation who shall have signed any of the Right Certificates
shall cease to be such officer of the Corporation before
countersignature by the Rights Agent and issuance and delivery by
the Corporation, such Right Certificates may nevertheless be
countersigned by the Rights Agent and issued and delivered by the
Corporation with the same force and effect as though the person
who signed such Right Certificates had not ceased to be such
officer of the Corporation; and any Right Certificate may be
signed on behalf of the Corporation by any person who, at the
actual date of the execution of such Right Certificate, shall be
a proper officer of the Corporation to sign such Right
Certificate, although at the date of the execution of this Rights
Agreement any such person was not such an officer.
Following the Distribution Date, the Rights Agent will
keep or cause to be kept, at its office designated as the
appropriate place for surrender of such Right Certificate for
transfer, 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 certificate number 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 CERTIFICATE. Subject to the provisions of Section
4(b), Section 7(e) and Section 14 hereof, at any time after the
close of business on the Distribution Date, and at or prior to
the close of business on the earlier of the Redemption Date or
the Final Expiration Date, any Right Certificate or Right
Certificates may be transferred, split up, combined or exchanged
for another Right
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<PAGE> 15
Certificate or Right Certificates, entitling the registered holder
to purchase a like number of one one-hundredths of a Preferred Share
(or, following a Triggering Event, other securities, as the case may
be) as the Right Certificate or Right Certificates surrendered then
entitled such holder (or former holder in the case of a transfer) to
purchase. Any registered holder desiring to transfer, split up, combine
or exchange any Right Certificate or Right Certificates shall make
such request in writing delivered to the Rights Agent, and shall
surrender the Right Certificate or Right Certificates to be
transferred, split up, combined or exchanged at the principal
office or offices of the Rights Agent designated for such
purpose. Neither the Rights Agent nor the Corporation shall be
obligated to take any action whatsoever with respect to the
transfer of any such surrendered Right Certificate until the
registered holder shall have completed and signed the certificate
contained in the form of assignment on the reverse side of such
Right Certificate and shall have provided such additional
evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the
Corporation shall reasonably request. Thereupon the Rights Agent
shall, subject to Section 4(b), Section 7(e) and Section 14
hereof, countersign and deliver to the Person entitled thereto a
Right Certificate or Right Certificates, as the case may be, as
so requested. The Corporation may require payment of a sum
sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer, split-up, combination or
exchange of Right Certificates.
Upon receipt by the Corporation 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 Corporation's request,
reimbursement to the Corporation and the Rights Agent of all
reasonable expenses incidental thereto, and upon surrender to the
Rights Agent and cancellation of the Right Certificate if
mutilated, the Corporation will make and deliver a new Right
Certificate of like tenor to the Rights Agent for
countersignature and delivery to the registered holder in lieu of
the Right Certificate so lost, stolen, destroyed or mutilated.
Section 7. EXERCISE OF RIGHTS; PURCHASE PRICE;
EXPIRATION DATE OF RIGHTS. (a) Subject to Section 7(e) hereof,
the registered holder of any Right Certificate may exercise the
Rights evidenced thereby (except as otherwise provided herein) in
whole or in part at any time after the Distribution Date upon
surrender of the Right Certificate, with the form of election to
purchase and the certificate on the reverse side thereof duly
executed, to the Rights Agent at the principal office or offices
of the Rights Agent designated for such purpose, together with
payment of the aggregate Purchase Price for the total number of
one one-hundredths of a Preferred Share (or other securities, as
the case may be) as to which such surrendered Rights are
exercised, at or prior to the earliest of (i) the Close of
Business on November 10, 2005 (the "Final Expiration Date"), (ii)
the time at which the Rights are redeemed as provided in Section
23 hereof (the "Redemption
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<PAGE> 16
Date"), (iii) the time at which the Rights are exchanged as provided
in Section 24 hereof, or (iv) the consummation of a transaction
contemplated by Section 13(d) hereof.
(b) The Purchase Price for each one-hundredth of a
Preferred Share pursuant to the exercise of a Right shall
initially be $200, shall be subject to adjustment from time to
time as provided in the next sentence and in Sections 11 and
13(a) hereof and shall be payable in accordance with paragraph
(c) below. Anything in this Agreement to the contrary
notwithstanding, in the event that at any time after November 24,
1995 and prior to the Distribution Date, the Corporation shall
(i) declare or pay any dividend on the Common Shares payable in
Common Shares or (ii) effect a subdivision, combination or
consolidation of the Common Shares (by reclassification or
otherwise than by payment of dividends in Common Shares) into a
greater or lesser number of Common Shares, then in any such case,
each Common Share outstanding following such subdivision,
combination or consolidation shall continue to have one Right
(subject to adjustment as provided herein) associated therewith
and the Purchase Price following any such event shall be
proportionately adjusted to equal the result obtained by
multiplying the Purchase Price immediately prior to such event by
a fraction the numerator of which shall be the total number of
Common Shares outstanding immediately prior to the occurrence of
the event and the denominator of which shall be the total number
of Common Shares outstanding immediately following the occurrence
of such event. The adjustment provided for in the preceding
sentence shall be made successively whenever such a dividend is
declared or paid or such a subdivision, combination or
consolidation is effected.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase and the
certificate duly executed, accompanied by payment of the Purchase
Price for the Preferred Shares (or other securities, as the case
may be) 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 6 hereof by certified
check, cashier's check or money order payable to the order of the
Corporation, the Rights Agent shall thereupon promptly (i) (A)
requisition from any transfer agent of the Preferred Shares
certificates for the number of Preferred Shares to be purchased
and the Corporation hereby irrevocably authorizes its transfer
agent to comply with all such requests, or (B) requisition from
the depositary agent (if the Corporation, in its sole discretion,
shall have elected to deposit the Preferred Shares issuable upon
exercise of the Rights hereunder into a depositary) depositary
receipts representing such number of one one-hundredths of a
Preferred Share as are to be purchased (in which case
certificates for the Preferred Shares represented by such
receipts shall be deposited by the transfer agent with the
depositary agent) and the Corporation will direct the depositary
agent to comply with such requests, (ii) when appropriate,
requisition from the Corporation the amount of cash to be paid in
lieu of issuance of fractional shares in accordance with Section
14 hereof, (iii) after receipt of such certificates or depositary
receipts, cause the same to be
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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 thereof, deliver
such cash to or upon the order of the registered holder of such Right
Certificate. In the event that the Corporation is obligated to
issue other securities (including Common Shares) of the
Corporation pursuant to Section 11(a) hereof, the Corporation
will make all arrangements necessary so that such other
securities are available for distribution by the Rights Agent, if
and when appropriate.
In addition, in the case of an exercise of the Rights
by a holder pursuant to Section 11(a)(ii), the Rights Agent shall
return such Right Certificate to the registered holder thereof
after imprinting, stamping or otherwise indicating thereon that
the rights represented by such Right Certificate no longer
include the rights provided by Section 11(a)(ii) of the Rights
Agreement and if less than all the Rights represented by such
Right Certificate were so exercised, the Rights Agent shall
indicate on the Right Certificate the number of Rights
represented thereby which continue to include the rights provided
by Section 11(a)(ii).
(d) In case the registered holder of any Right
Certificate shall exercise less than all the Rights evidenced
thereby, a new Right Certificate evidencing Rights equivalent to
the Rights remaining unexercised shall be issued by the Rights
Agent to the registered holder of such Right Certificate or to
his duly authorized assigns, subject to the provisions of Section
14 hereof, or the Rights Agent shall place an appropriate
notation on the Right Certificate with respect to those rights
exercised.
(e) Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of a Section
11(a)(ii) Event, any Rights beneficially owned by (i) an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person, (ii) a transferee of an Acquiring Person (or of any
Affiliate or Associate thereof) who becomes a transferee after
the Acquiring Person becomes such, or (iii) a transferee of an
Acquiring Person (or of any Affiliate or Associate thereof) who
becomes a transferee prior to or concurrently with the Acquiring
Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the
Acquiring Person to holders of equity interests in such Acquiring
Person or to any Person with whom the Acquiring Person has a
continuing agreement, arrangement or understanding regarding the
transferred Rights or (B) a transfer which the Board of Directors
of the Corporation has determined is part of a plan, arrangement
or understanding which has as a primary purpose or effect the
avoidance of this Section 7(e), shall become null and void
without any further action and no holder of such Rights shall
have any rights whatsoever with respect to such Rights, whether
under any provision of this Agreement or otherwise. The
Corporation shall use all reasonable efforts to insure that the
provisions of this Section 7(e) and Section 4(b) hereof are
complied with, but shall have no liability to any holder of Right
Certificates or other Person as a result of its failure to make
any
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<PAGE> 18
determinations with respect to an Acquiring Person or its
Affiliates, Associates or transferees hereunder.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Corporation shall be
obligated to undertake any action with respect to a registered
holder upon the occurrence of any purported exercise as set forth
in this Section 7 unless such registered holder shall have (i)
completed and signed the certificate contained in the form of
election to purchase set forth on the reverse side of the Right
Certificate surrendered for such exercise, and (ii) provided such
additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) or Affiliates or Associates thereof as
the Corporation shall reasonably request.
Section 8. CANCELLATION AND DESTRUCTION OF RIGHT
CERTIFICATES. All Right Certificates surrendered for the purpose
of exercise (other than a partial exercise), transfer, split up,
combination or exchange shall, if surrendered to the Corporation
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 Rights Agreement. The Corporation
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 Corporation
otherwise than upon the exercise thereof. The Rights Agent shall
deliver all cancelled Right Certificates to the Corporation, or
shall, at the written request of the Corporation, destroy such
cancelled Right Certificates, and in such case shall deliver a
certificate of destruction thereof to the Corporation.
Section 9. RESERVATION AND AVAILABILITY OF CAPITAL
STOCK. The Corporation covenants and agrees that at all time
prior to the occurrence of a Section 11(a)(ii) Event it will
cause to be reserved and kept available out of its authorized and
unissued Preferred Shares, or any authorized and issued Preferred
Shares held in its treasury, the number of Preferred Shares that
will be sufficient to permit the exercise in full of all
outstanding Rights and, after the occurrence of a
Section 11(a)(ii) Event, shall, to the extent reasonably
practicable, so reserve and keep available a sufficient number of
Common Shares (and/or other securities) which may be required to
permit the exercise in full of the Rights pursuant to this
Agreement.
So long as the Preferred Shares (and, after the
occurrence of a Section 11(a)(ii) Event, Common Shares, or any
other securities, as the case may be) issuable upon the exercise
of the Rights may be listed on any national securities exchange,
the Corporation 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 on such exchange upon
official notice of issuance upon such exercise.
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The Corporation covenants and agrees that it will take
all such action as may be necessary to ensure that all Preferred
Shares (or Common Shares and/or other securities, as the case may
be) delivered upon exercise of Rights shall, at the time of
delivery of the certificates for such shares or other securities
(subject to payment of the Purchase Price), be duly and validly
authorized and issued and fully paid and non-assessable shares or
securities.
The Corporation 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
Preferred Shares (or Common Shares and/or other securities, as
the case may be) upon the exercise of Rights. The Corporation
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 Shares
(or Common Shares and/or other securities, as the case may be) in
a name other than that of, the registered holder of the Right
Certificate evidencing Rights surrendered for exercise, or to
issue or to deliver any certificates or depositary receipts for
Preferred Shares (or Common Shares and/or other securities, as
the case may be) upon the exercise of any Rights, until any such
tax shall have been paid (any such tax being payable by the
holder of such Right Certificate at the time of surrender) or
until it has been established to the Corporation's reasonable
satisfaction that no such tax is due.
The Corporation shall use its best efforts to (i) file,
as soon as practicable following the Shares Acquisition Date (or,
if required by law, at such earlier time following the
Distribution Date as so required), a registration statement under
the Act, with respect to the securities purchasable upon exercise
of the Rights on an appropriate form, (ii) cause such
registration statement to become effective as soon as practicable
after such filing, and (iii) cause such registration statement to
remain effective (with a prospectus at all times meeting the
requirements of the Act and the rules and regulations thereunder)
until the date of the expiration of the rights provided by
Section 11(a)(ii). The Corporation will also take such action as
may be appropriate under the blue sky laws of the various states.
Section 10. PREFERRED SHARES RECORD DATE. Each Person
in whose name any certificate for Preferred Shares (or Common
Shares and/or other securities, as the case may be) is issued
upon the exercise of Rights shall for all purposes be deemed to
have become the holder of record of the Preferred Shares (or
Common Shares and/or other securities, as the case may be)
represented thereby on, and such certificate shall be dated, the
date upon which the Right Certificate evidencing such Rights was
duly surrendered and 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 Shares (or Common Shares and/or other securities, as
the case may
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<PAGE> 20
be) transfer books of the Corporation 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 Shares (or Common Shares and/or other
securities, as the case may be) transfer books of the Corporation
are open.
Section 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER AND
KIND OF SHARES OR NUMBER OF RIGHTS. The Purchase Price, the
number and kind of shares covered by each Right and the number of
Rights outstanding are subject to adjustment from time to time as
provided in this Section 11.
(a) (i) In the event the Corporation shall at any
time after the date of this Agreement (A) declare a dividend on
the Preferred Shares payable in Preferred Shares, (B) subdivide
the outstanding Preferred Shares or (C) combine the outstanding
Preferred Shares into a smaller number of Preferred Shares or (D)
issue any shares of its capital stock in a reclassification of
the Preferred Shares (including any such reclassification in
connection with a consolidation or merger in which the
Corporation is the continuing or surviving corporation), except
as otherwise provided in this Section 11(a) and Section 7(e)
hereof, the Purchase Price in effect at the time of the record
date for such dividend or of the effective date of such
subdivision, combination or reclassification, and the number and
kind of shares of 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 Preferred Shares transfer books of the
Corporation were open, such 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 Corporation issuable upon exercise
of one Right. If an event occurs which would require an
adjustment under both Section 11(a)(i) and Section 11(a)(ii), the
adjustment provided for in this Section 11(a)(i) shall be in
addition to, and shall be made prior to, any adjustment required
pursuant to Section 11(a)(ii).
(ii) In the event any Person, alone or together with
its Affiliates and Associates, shall become an Acquiring Person,
then proper provision shall be made so that each holder of a
Right (except as provided below and in Section 7(e) hereof)
shall, for a period of 60 days after the later of (i) the close
of business on the tenth day after the occurrence of any such
event or (ii) the effective date of an appropriate registration
statement under the Act pursuant to Section 9 hereof, and in
addition, if a Section 13(a)(z) Event shall have occurred, for a
second period of 60 days after the later of (i) the occurrence of
the Section 13(a)(z) Event or the effective date of an
appropriate registration statement under the Act pursuant to
Section 9 hereof, have a right to receive,
15
<PAGE> 21
upon exercise thereof at a price equal to the then current Purchase
Price, in accordance with the terms of this Agreement, such number
of Common Shares (or, in the discretion of the Board of Directors,
one one-hundredths of a Preferred Share) as shall equal the result
obtained by (x) multiplying the then current Purchase Price by the
then number of one one-hundredths of a Preferred Share for which a
Right was exercisable immediately prior to the first occurrence of
a Section 11(a)(ii) Event or immediately prior to the Section 13(a)(z)
Event, as the case may be, and (y) dividing that product by 50% of
the then current per share market price of the Corporation's Common
Shares (determined pursuant to Section 11(d) hereof) on the date of
such first occurrence (such number of shares being referred to as
the "Adjustment Shares");
(iii) In the event that there shall not be
sufficient treasury shares or authorized but unissued (and
unreserved) Common Shares to permit the exercise in full of the
Rights in accordance with the foregoing subparagraph (ii) and the
Rights become so exercisable (and the Board has determined to
make the Rights exercisable into fractions of a Preferred Share),
notwithstanding any other provision of this Agreement, to the
extent necessary and permitted by applicable law, each Right
shall thereafter represent the right to receive, upon exercise
thereof at the then current Purchase Price in accordance with the
terms of this Agreement, (x) a number of (or fractions of) Common
Shares (up to the maximum number of Common Shares which may
permissibly be issued) and (y) one one-hundredth of a Preferred
Share or a number of (or fractions of) other equity securities of
the Corporation (or, in the discretion of the Board of Directors,
debt) which the Board of Directors of the Corporation has
determined to have the same aggregate current market value
(determined pursuant to Sections 11(d)(i) and (ii) hereof, to the
extent applicable) as one Common Share (such number of (or
fractions of) Preferred Shares (or other equity securities or
debt of the Corporation) being referred to as a "capital stock
equivalent"), equal in the aggregate to the number of Adjustment
Shares; provided, however, if sufficient Common Shares and/or
capital stock equivalents are unavailable, then the Corporation
shall, to the extent permitted by applicable law, take all such
action as may be necessary to authorize additional Common Shares
or capital stock equivalents for issuance upon exercise of the
Rights, including the calling of a meeting of stockholders; and
provided, further, that if the Corporation is unable, because it
is not permitted by applicable law, to cause sufficient Common
Shares and/or capital stock equivalents to be available for
issuance upon exercise in full of the Rights, then each Right
shall thereafter represent the right to receive the Adjusted
Number of Shares upon exercise at the Adjusted Purchase Price (as
such terms are hereinafter defined). As used herein, the term
"Adjusted Number of Shares" shall be equal to that number of (or
fractions of) Common Shares (and/or capital stock equivalents)
equal to the product of (x) the number of Adjustment Shares and
(y) a fraction, the numerator of which is the number of Common
Shares (and/or capital stock equivalents) available for issuance
upon exercise of the Rights and the denominator of which is the
aggregate number of Adjustment Shares
16
<PAGE> 22
otherwise issuable upon exercise in full of all Rights (assuming
there were a sufficient number of Common Shares available) (such
fraction being referred to as the "Proration Factor"). The
"Adjusted Purchase Price" shall mean the product of the Purchase
Price and the Proration Factor. The Board of Directors may, but
shall not be required to, establish procedures to allocate the
right to receive Common Shares and capital stock equivalents upon
exercise of the Rights among holders of Rights.
(b) In case the Corporation shall fix a record date
for the issuance of rights (other than the Rights), options or
warrants to all holders of Preferred Shares entitling them (for a
period expiring within 45 calendar days after such record date)
to subscribe for or purchase Preferred Shares (or shares having
the same rights and privileges as the Preferred Shares
("equivalent preferred shares") or securities convertible into
Preferred Shares or equivalent preferred shares at a price per
Preferred Share or equivalent preferred share (or having a
conversion price per share, if a security convertible into
Preferred Shares or equivalent preferred shares) less than the
then current per share market price of the Preferred Shares (as
determined pursuant to Section 11(d) hereof) on such record date,
the Purchase Price to be in effect after such record date shall
be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the
numerator of which shall be the number of Preferred Shares
outstanding on such record date plus the number of Preferred
Shares which the aggregate offering price of the total number of
Preferred Shares and/or equivalent preferred shares so to be
offered (and/or the aggregate initial conversion price of the
convertible securities so to be offered) would purchase at such
current per share market price, and the denominator of which
shall be the number of Preferred Shares outstanding on such
record date plus the number of additional Preferred Shares and/or
equivalent preferred shares to be offered for subscription or
purchase (or into which the convertible securities so to be
offered are initially convertible); 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 Corporation 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 determined in good
faith by the Board of Directors of the Corporation, whose
determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent. Preferred
Shares owned by or held for the account of the Corporation 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 Corporation shall fix a record date
for the making of a distribution to all holders of the Preferred
Shares (including any such distribution made in connection with a
consolidation or merger in which the Corporation is the
continuing or
17
<PAGE> 23
surviving corporation) of evidences of indebtedness
or assets (other than a regular quarterly cash dividend or a
dividend payable in Preferred Shares) or subscription rights or
warrants (excluding those referred to in Section 11(b) hereof),
the Purchase Price to be in effect after such record date shall
be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the
numerator of which shall be the then current per share market
price (as determined pursuant to Section 11(d) hereof) of the
Preferred Shares on such record date, less the fair market value
(as determined in good faith by the Board of Directors of the
Corporation, whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the
Rights Agent) of the portion of the assets or evidences of
indebtedness so to be distributed or of such subscription rights
or warrants applicable to one Preferred Share and the denominator
of which shall be such current per share market price of the
Preferred Shares; 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 Corporation 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) For the purpose of any computation hereunder,
the "current per share market price" of any security (a
"Security" for the purpose 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 thirty (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 thirty (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 in the principal consolidated
transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock Exchange or, if the
Security is not listed or admitted to trading on the New York
Stock Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities listed on
the principal national securities exchange on which the 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
18
<PAGE> 24
average of the high bid and low asked prices in the over-the-counter
market, as reported by the National Association of Securities
Dealers, Inc. Automated Quotations System ("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 Corporation. If on any such date no such market
maker is making a market in the Security, the fair value of the
Security on such date as determined in good faith by the Board of
Directors of the Corporation shall be used. 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. Subject to Section 11(d)(ii), if any
Security is not publicly held or so listed or traded, "current
per share market price" of such Security shall mean the fair
market value per share as determined in good faith by the Board
of Directors of the Corporation, whose determination shall be
described in a statement filed with the Rights Agent and shall be
binding on the Rights Agent.
(ii) For the purpose of any computation hereunder,
the "current per share market price" of the Preferred Shares
shall be determined in accordance with the method set forth in
Section 11(d)(i). If the Preferred Shares are not publicly
traded, the current per share market price of the Preferred
Shares shall be conclusively deemed to be the current per share
market price of the Common Shares as determined pursuant to
Section 11(d)(i) (appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the
date hereof), multiplied by one hundred. If neither the Common
Shares nor the Preferred Shares are publicly held or so listed or
traded, "current per share market price" shall mean the fair
value per share as determined in good faith by the Board of
Directors of the Corporation, whose determination shall be
described in a statement filed with the Rights Agent and shall be
binding on the Rights Agent.
(e) Notwithstanding anything herein to the contrary,
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 one-hundredth of a
Preferred Share or one ten-thousandth of any 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 (3) years
from the date of the transaction which mandates such adjustment
or (ii) the Final Expiration Date.
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<PAGE> 25
(f) If, as a result of an adjustment made pursuant to
Section 11(a)(ii) or Section 13(a) hereof, the holder of any
Right thereafter exercised shall become entitled to receive any
shares of capital stock of the Corporation other than Preferred
Shares, thereafter the number of other shares so receivable upon
exercise of any Right shall be subject to adjustment from time to
time in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Preferred Shares contained
in Sections 11(a) through (c), inclusive, and the provisions of
Sections 7, 9, 10, 13 and 14 with respect to the Preferred Shares
shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Corporation
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-hundredths of a Preferred Share
purchasable from time to time hereunder upon exercise of the
Rights, all subject to further adjustment as provided herein.
(h) Unless the Corporation 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-hundredths of a Preferred Share (calculated to the
nearest one ten-thousandth of a Preferred Share) obtained by (i)
multiplying (x) the number of Preferred Shares covered by a Right
immediately prior to this adjustment of the Purchase Price by (y)
the Purchase Price in effect immediately prior to such adjustment
of the Purchase Price and (ii) dividing the product so obtained
by the Purchase Price in effect immediately after such adjustment
of the Purchase Price.
(i) The Corporation may elect on or after the date of
any adjustment of the Purchase Price to adjust the number of
Rights, in lieu of any adjustment in the number of one one-
hundredths of a Preferred Share purchasable upon the exercise of
a Right. Each of the Rights outstanding after such adjustment of
the number of Rights shall be exercisable for the number of one
one-hundredths of a Preferred Share 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 Corporation 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 ten (10) days later than the date of the public
announcement. If Right Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section
11(i), the Corporation shall,
20
<PAGE> 26
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 Corporation,
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 Corporation, 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 andshall 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-hundredths of a Preferred
Share 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-hundredths
of a Preferred Share 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 value,
if any, of the number of one one-hundredths of a Preferred Share,
Common Shares or other securities issuable upon exercise of the
Rights, the Corporation shall take any corporate action which
may, in the opinion of its counsel, be necessary in order that
the Corporation may validly and legally issue such number of
fully paid and nonassessable one one-hundredths of a Preferred
Share, Common Shares or other securities at such adjusted
Purchase Price.
(1) 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 Corporation may elect to
defer until the occurrence of such event the issuance to the
holder of any Right exercised after such record date the
Preferred Shares, Common Shares or other securities of the
Corporation, if any, issuable upon such exercise over and above
the Preferred Shares, Common Shares or other securities of the
Corporation, if any, issuable upon exercise on the basis of the
Purchase Price in effect prior to such adjustment; provided,
however, that the Corporation 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) Notwithstanding anything in this Section 11 to the
contrary, the Corporation 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 be
advisable in order that any (i) consolidation or subdivision of
the Preferred Shares, (ii) issuance wholly for cash of Preferred
Shares at
21
<PAGE> 27
less than the current market price, (iii) issuance
wholly for cash of Preferred Shares or securities which by their
terms are convertible into or exchangeable for Preferred Shares,
(iv) stock dividends or (v) issuance of rights, options or
warrants referred to in this Section 11, hereafter made by the
Corporation to holders of its Preferred Shares shall not be
taxable to such stockholders.
(n) The Corporation covenants and agrees that it shall
not, at any time after the Distribution Date, (i) consolidate
with any other Person (other than a Subsidiary of the Corporation
in a transaction which does not violate Section 11(o) hereof),
(ii) merge with or into any other Person (other than a Subsidiary
of the Corporation in a transaction which does not violate
Section 11(o) hereof), or (iii) sell or transfer (or permit any
Subsidiary to sell or transfer), in one transaction, or a series
of related transactions, assets or earning power aggregating more
than 50% of the assets or earning power of the Corporation and
its Subsidiaries (taken as a whole) to any other Person or
Persons (other than the Corporation and/or any of its
Subsidiaries in one or more transactions each of which does not
violate Section 11(o) hereof), if (x) at the time of or
immediately after such consolidation, merger, sale or transfer
there are any charter or by-law provisions or any rights,
warrants or other instruments or securities outstanding or
agreements in effect or other actions taken, which would
materially diminish or otherwise eliminate the benefits intended
to be afforded by the Rights or (y) prior to, simultaneously with
or immediately after such consolidation, merger or sale, the
stockholders of the Person who constitutes, or would constitute,
the "Principal Party" for purposes of Section 13(a) hereof shall
have received a distribution of Rights previously owned by such
Person or any of its Affiliates and Associates. The Corporation
shall not consummate any such consolidation, merger, sale or
transfer unless prior thereto the Corporation and such other
Person shall have executed and delivered to the Rights Agent a
supplemental agreement evidencing compliance with this Section
11(n).
(o) The Corporation covenants and agrees that, after
the Distribution Date, it will not, except as permitted by
Section 23 or Section 27 hereof, take (or permit any Subsidiary
to take) any action the purpose of which is to, or if at the time
such action is taken it is reasonably foreseeable that the effect
of such action is to, materially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights.
(p) The exercise of Rights under Section 11(a)(ii)
shall only result in the reduction of rights under Section
11(a)(ii) to the extent so exercised and shall not otherwise
affect the rights represented by the Rights under this Rights
Agreement, including the rights represented by Section 13.
Section 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR
NUMBER OF SHARES. Whenever an adjustment is made as provided in
Sections 11 or 13 hereof, the Corporation shall promptly (a)
prepare a certificate setting forth such adjustment, and a brief
statement
22
<PAGE> 28
of the facts accounting for such adjustment, (b) file
with the Rights Agent and with each transfer agent for the Common
Shares and the Preferred Shares a copy of such certificate and
(c) mail a brief summary thereof to each holder of a Right
Certificate in accordance with Section 26 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 such adjustment unless and until it shall
have received such certificate.
Section 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER
OF ASSETS OR EARNING POWER. (a) In the event that, on or
following the Shares Acquisition Date, directly or indirectly,
(x) the Corporation shall consolidate with, or merge with and
into, any Interested Stockholder or, if in such merger or
consolidation all holders of Common Shares are not treated alike,
any other Person, (y) the Corporation shall consolidate with, or
merge with, any Interested Stockholder or, if in such merger or
consolidation all holders of Common Shares are not treated alike,
any other Person, and the Corporation shall be the continuing or
surviving corporation of such consolidation or merger (other
than, in a case of any transaction described in (x) or (y), a
merger or consolidation which would result in all of the
securities generally entitled to vote in the election of
directors ("voting securities") of the Corporation outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into securities of
the surviving entity) all of the voting securities of the
Corporation or such surviving entity outstanding immediately
after such merger or consolidation and the holders (and relative
percentage holdings of each such holder) of such securities not
having changed as a result of such merger or consolidation), or
(z) (the transactions on or following a Shares Acquisition Date
referred to in this Section 13(a)(z) will in this Agreement be
referred to as Section 13(a)(z) Events and any such transaction
will in this Agreement be referred to as a Section 13(a)(z)
Event) the Corporation shall sell or otherwise transfer (or one
or more of its Subsidiaries shall sell or otherwise transfer), in
one transaction or a series of related transactions, assets or
earning power aggregating more than 50% of the assets or earning
power of the Corporation and its Subsidiaries (taken as a whole)
to any Interested Stockholder or Persons or, if in such
transaction all holders of Common Shares are not treated alike,
any other Person, (other than the Corporation or any Subsidiary
of the Corporation in one or more transactions each of which does
not violate Section 11(o) hereof), then, and in each such case
(except as provided in Section 13(d) hereof), proper provision
shall be made so that (i) each holder of a Right, except as
provided in Section 7(e) hereof, shall thereafter have the right
to receive, upon the exercise thereof at a price equal to the
then current Purchase Price, in accordance with the terms of this
Agreement and in lieu of Preferred Shares, such number of freely
tradeable Common Shares of the Principal Party (as hereinafter
defined), not subject to any liens, encumbrances, rights of first
refusal or other adverse claims, as shall equal the result
obtained by (A) multiplying the then current Purchase Price by
the number of one one-hundredths of a Preferred Share for which a
Right is then exercisable (without taking into account any
adjustment
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<PAGE> 29
previously made pursuant to Section 11(a)(ii)) and
dividing that product by (B) 50% of the then current per share
market price of the Common Shares of such Principal Party
(determined pursuant to Section 11(d) hereof) on the date of
consummation of such Section 13 Event; (ii) such Principal Party
shall thereafter be liable for, and shall assume, by virtue of
such Section 13 Event, all the obligations and duties of the
Corporation pursuant to this Agreement, except that if a
Section 13(a)(z) Event shall have occurred, the Corporation shall
continue to be subject to all of its obligations and duties under
this Agreement (except as set forth in clause (iii) below) and
such Principal Party shall also be subject to those obligations
and duties; (iii) the term "Corporation" shall thereafter be
deemed to refer to such Principal Party, except that if a
Section 13(a)(z) Event shall have occurred, the term
"Corporation" shall also be deemed to refer to the Corporation,
it being specifically intended that the provisions of Section 11
hereof shall apply only to such Principal Party following the
first occurrence of a Section 13 Event unless a Section 13(a)(z)
Event shall have occurred, in which case it is intended that the
provisions of Section 11 hereof shall apply to both the
Corporation and to such Principal Party during the second 60 day
period referred to in Section 11 (a)(ii) hereof and only to such
Principal Party thereafter; and (iv) such Principal Party shall
take such steps (including, but not limited to, the reservation
of a sufficient number of its Common Shares) in connection with
the consummation of 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 Common Shares
thereafter deliverable upon the exercise of the Rights.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in
clause (x) or (y) of the first sentence of Section 13(a), the
Person that is the issuer of any securities into which Common
Shares of the Corporation are converted in such merger or
consolidation, and if no securities are so issued, the Person
that is the other party to such merger or consolidation
(including, if applicable, the Corporation if it is the surviving
corporation); and
(ii) in the case of any transaction described in
clause (z) of the first sentence of Section 13(a), the Person
that is the party receiving the greatest portion of the assets or
earning power transferred pursuant to such transaction or
transactions;
provided, however, that in any of the foregoing cases, (1) if the
Common Shares of such Person are not at such time and have not
been continuously over the preceding twelve (12) month period
registered under Section 12 of the Exchange Act, and such Person
is a direct or indirect Subsidiary of another Person the Common
Shares of which are and have been so registered, "Principal
Party" shall refer to such other Person; (2) in case such Person
is a Subsidiary, directly or indirectly, of more than one Person,
the Common Shares of two or more of which are and have been so
registered, "Principal Party" shall
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refer to whichever of such Persons is the issuer of the Common
Shares having the greatest aggregate market value; and (3) in case
such Person is owned, directly or indirectly, by a joint venture
formed by two or more Persons that are not owned, directly or
indirectly, by the same Person, the rules set forth in (1) and (2)
above shall apply to each of the chains of ownership having an
interest in such joint venture as if such party were a "Subsidiary"
of both or all of such joint venturers and the Principal Parties
in each such chain shall bear the obligations set forth in this
Section 13 in the same ratio as their direct or indirect interests
in such Person bear to the total of such interests.
(c) The Corporation shall not consummate any such
consolidation, merger, sale or transfer unless the Principal
Party shall have a sufficient number of its authorized Common
Shares which have not been issued or reserved for issuance to
permit the exercise in full of the Rights in accordance with this
Section 13 and unless prior thereto the Corporation and such
Principal Party shall have executed and delivered to the Rights
Agent a supplemental agreement providing for the terms set forth
in paragraphs (a) and (b) of this Section 13 and further
providing that, as soon as practicable after the date of any
consolidation, merger, sale or transfer mentioned in paragraph
(a) of this Section 13, the Principal Party at its own expense
shall:
(i) prepare and file a registration statement
under the Act with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form,
and use its best efforts to cause such registration statement to
(A) become effective as soon as practicable after such filing and
(B) remain effective (with a prospectus at all times meeting the
requirements of the Act) until the Final Expiration Date;
(ii) use its best efforts to qualify or register
the Rights and the securities purchasable upon exercise of the
Rights under the blue sky laws of such jurisdictions as may be
necessary or appropriate; and
(iii) deliver to holders of the Rights historical
financial statements for the Principal Party which comply in all
respects with the requirements for registration on Form 10 under
the Exchange Act.
The provisions of this Section 13 shall similarly apply
to successive mergers or consolidations or sales or other
transfers. The rights under this Section 13 shall be in addition
to the rights to exercise Rights and adjustments under Section
11(a)(ii) and shall survive any exercise thereof.
(d) Notwithstanding anything in this Agreement to the
contrary, Section 13 shall not be applicable to a transaction
described in subparagraphs (x) and (y) of Section 13(a) if: (i)
such transaction is consummated with a Person or Persons who
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acquired Common Shares pursuant to a Permitted Offer (or a wholly
owned Subsidiary of any such Person or Persons); (ii) the price
per Common Share offered in such transaction is not less than the
price per Common Share paid to all holders of Common Shares whose
shares were purchased pursuant to such Permitted Offer; and (iii)
the form of consideration offered in such transaction is the same
as the form of consideration paid pursuant to such Permitted
Offer. Upon consummation of any such transaction contemplated by
this Section 13(d), all Rights hereunder shall expire.
Section 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) The Corporation shall not be required to issue fractions of
Rights or to distribute Right Certificates which evidence
fractional Rights. In lieu of such fractional Rights, there
shall be paid to the registered holders of the Right Certificates
with regard to which such fractional Rights would otherwise be
issuable, an amount in cash equal to the same fraction of the
current market value of a whole Right. For the purposes of this
Section 14(a), the current market value of a whole Right shall be
the closing price of the Rights for the Trading Day immediately
prior to the date on which such fractional Rights would have been
otherwise issuable. The closing price for any day shall be the
last sale price, regular way, or, in case no such sale takes
place on such day, the average of the closing bid and asked
prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to
securities listed or admitted to trading on the New York Stock
Exchange or, if the Rights are not listed or admitted to trading
on the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange
on which the Rights are listed or admitted to trading or, if the
Rights are not listed or admitted to trading on any national
securities exchange, the last quoted price or, if not so quoted,
the average of the high bid and low asked prices in the over-the-
counter market, as reported by NASDAQ or such other system then
in use or, if on any such date the Rights are not quoted by any
such organization, the average of the closing bid and asked
prices as furnished by a professional market maker making a
market in the Rights selected by the Board of Directors of the
Corporation. If on any such date no such market maker is making
a market in the Rights, the fair value of the Rights on such date
as determined in good faith by the Board of Directors of the
Corporation shall be used.
(b) The Corporation shall not be required to issue
fractions of Preferred Shares (other than fractions which are one
one-hundredths or integral multiples of one one-hundredth of a
Preferred Share) upon exercise of the Rights or to distribute
certificates which evidence fractional Preferred Shares (other
than fractions which are one one-hundredths or integral multiples
of one one-hundredth of a Preferred Share). Fractions of
Preferred Shares in integral multiples of one one-hundredth of a
Preferred Share may, at the election of the Corporation, be
evidenced by depositary receipts, pursuant to an appropriate
agreement between the Corporation and a depositary selected by
it; provided that such agreement shall provide that the holders
of such depositary
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receipts shall have the rights, privileges and
preferences to which they are entitled as beneficial owners of
the Preferred Shares represented by such depositary receipts. In
lieu of fractional Preferred Shares that are not one
one-hundredth or integral multiples of one one-hundredth of a
Preferred Share, the Corporation 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 Preferred Share. For
the purposes of this Section 14(b), the current market value of a
Preferred Share shall be the closing price of a Preferred Share
(as determined pursuant to Section 11(d)(ii) hereof) for the
Trading Day immediately prior to the date of such exercise.
(c) Following the occurrence of one of the
transactions or events specified in Section 11 giving rise to the
right to receive Common Shares, capital stock equivalents (other
than Preferred Shares) or other securities upon the exercise of a
Right, the Corporation shall not be required to issue fractions
of shares or units of such Common Shares, capital stock
equivalents or other securities upon exercise of the Rights or to
distribute certificates which evidence fractions of such Common
Shares, capital stock equivalents or other securities. In lieu
of fractional shares or units of such Common Shares, capital
stock equivalents or other securities, the Corporation may pay to
the registered holders of Right Certificates at the time such
Rights are exercised as herein provided an amount in cash equal
to the same fraction of the current market value of a share or
unit of such Common Shares, capital stock equivalents or other
securities. For purposes of this Section 14(c), the current
market value shall be determined in the manner set forth in
Section 11(d) hereof for the Trading Day immediately prior to the
date of such exercise and, if such capital stock equivalent is
not traded, each such capital stock equivalent shall have the
value of one one-hundredth of a Preferred Share.
(d) The holder of a Right by the acceptance of the
Right expressly waives his right to receive any fractional Rights
or any fractional share 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 Shares); and any registered holder of any Right
Certificate (or, prior to the Distribution Date, of the Common
Shares), without the consent of the Rights Agent or of the holder
of any other Right Certificate (or, prior to the Distribution
Date, of the Common Shares), may, in his own behalf and for his
own benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Corporation to enforce, or
otherwise act in respect of, his right to exercise the Rights
evidenced by such Right Certificate in the manner provided in
such Right Certificate and in this Agreement. Without limiting
the foregoing or any remedies available to the holders of Rights,
it is specifically acknowledged that the
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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
Corporation and the Rights Agent and with every other holder of a
Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common
Shares;
(b) after the Distribution Date, the Right
Certificates are transferable only on the registry books of the
Rights Agent if surrendered at the principal office or offices of
the Rights Agent designated for such purpose, duly endorsed or
accompanied by a proper instrument of transfer and with the
appropriate form fully executed;
(c) subject to Section 6 and Section 7(f) hereof, the
Corporation and the Rights Agent may deem and treat the person in
whose name the Right Certificate (or, prior to the Distribution
Date, the associated Common Shares certificate) is registered as
the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the
Right Certificate or the associated Common Shares certificate
made by anyone other than the Corporation or the Rights Agent)
for all purposes whatsoever, and neither the Corporation nor the
Rights Agent, subject to the last sentence of Section 7(e)
hereof, shall be required to be affected by any notice to the
contrary; and
(d) notwithstanding anything in this Agreement to the
contrary, neither the Corporation nor the Rights Agent shall have
any liability to any holder of a Right or a beneficial interest
in a Right or other Person as a result of its inability to
perform any of its obligations under this Agreement by reason of
any preliminary or permanent injunction or other order, decree or
ruling issued by a court of competent jurisdiction or by a
governmental, regulatory or administrative agency or commission,
or any statute, rule, regulation or executive order promulgated
or enacted by any governmental authority, prohibiting or
otherwise restraining performance of such obligation; provided,
however, the Corporation must use its best efforts to have any
such order, decree or ruling lifted or otherwise overturned as
soon as possible.
Section 17. RIGHT CERTIFICATE HOLDER NOT DEEMED A
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 Shares or any other
securities of the Corporation which may at any time be issuable
on the exercise of the Rights represented
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<PAGE> 34
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
Corporation or any right to vote for the election of directors
or upon any matter submitted to stockholders at any meeting
thereof, or to give or withhold consent to any corporate action,
or to receive notice of meetings or other actions affecting
stockholders (except as provided in Section 25 hereof), or to receive
dividends or other distributions or to exercise any preemptive or
subscription rights, or otherwise, until the Right or Rights
evidenced by such Right Certificate shall have been exercised in
accordance with the provisions hereof.
Section 18. CONCERNING THE RIGHTS AGENT. The
Corporation agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from
time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and other disbursements incurred in the
administration and execution of this Agreement and the exercise
and performance of its duties hereunder. The Corporation 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 in the premises.
The Rights Agent shall be protected and shall incur no
liability for, or in respect of any action taken, suffered or
omitted by it in connection with, its administration of this
Agreement in reliance upon any Right Certificate or certificate
for Common Shares or for other securities of the Corporation,
instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document believed by it
to be genuine and to be signed, executed and, where necessary,
verified or acknowledged, by the proper Person or Persons.
Section 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME
OF RIGHTS AGENT. Any corporation into which the Rights Agent or
any successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to the
stock transfer or all or substantially all of the corporate trust
business of the Rights Agent or any successor Rights Agent, shall
be the successor to the Rights Agent under this 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
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<PAGE> 35
countersignature of a 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 or in
the name of the successor Rights Agent; and in all such cases
such Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall
be changed and at such time any of the Right Certificates shall
have been countersigned but not delivered, the Rights Agent may
adopt the countersignature under its prior name and deliver Right
Certificates so countersigned; and in case at that time any of
the Right Certificates shall not have been countersigned, the
Rights Agent may countersign such Right Certificates either in
its prior name or in its changed name; and in all such cases such
Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
Section 20. DUTIES OF RIGHTS AGENT. The Rights Agent
undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, by all of which the
Corporation 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 Corporation), 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 (including, without limitation,
the identity of an Acquiring Person and the determination of the
current market price of any Security) be proved or established by
the Corporation prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect
thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by a certificate signed by
any one of the Chairman of the Board, the President, any Vice
President, the Treasurer or the Secretary of the Corporation and
delivered to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken or
suffered in good faith by it under the provisions of this
Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only
for its own negligence, bad faith or willful misconduct.
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(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 on such Right Certificates) or be required to
verify the same, but all such statements and recitals are and
shall be deemed to have been made by the Corporation 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
Corporation of any covenant or condition contained in this
Agreement or in any Rights Certificate; nor shall it be
responsible for any adjustment required under the provisions of
Section 11 or Section 13 hereof or responsible for the manner,
method or amount of any such adjustment or the ascertaining of
the existence of facts that would require any such adjustment
(except with respect to the exercise of Rights evidenced by Right
Certificates after receipt of the certificate described in
Section 12 hereof); nor shall it by any act hereunder be deemed
to make any representation or warranty as to the authorization or
reservation of any Preferred Shares or Common Shares or other
securities to be issued pursuant to this Agreement or any Right
Certificate or as to whether any Preferred Shares or Common
Shares or other securities will, when issued, be validly
authorized and issued, fully paid and nonassessable.
(f) The Corporation agrees that it will perform,
execute, acknowledge and deliver or cause to be performed,
executed, acknowledged and delivered all such further and other
acts, instruments and assurances as may reasonably be required by
the Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its
duties hereunder from any one of the Chairman of the Board, the
President, any Vice President, the Treasurer or the Secretary of
the Corporation, and to apply to such officers for advice or
instructions in connection with its duties, and shall not be
liable for any action taken or suffered by it in good faith in
accordance with instructions of any such officer. Any
application by the Rights Agent for written instructions from the
Corporation 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 Rights Agreement and the date on 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 Corporation
actually receives such application, unless any such officer shall
have consented in writing to an earlier
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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 instruction 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 Corporation or
become pecuniarily interested in any transaction in which the
Corporation may be interested, or contract with or lend money to
the Corporation 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 Corporation or for any other legal entity.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents,
and the Rights Agent shall not be answerable or accountable for
any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Corporation resulting from any such
act, default, neglect or misconduct, provided reasonable care was
exercised in the selection and continued employment thereof.
(j) No provision of this Agreement shall require the
Rights Agent to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties
hereunder or in the exercise of its rights if there shall be
reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not
reasonably assured to it.
(k) If, with respect to any Rights Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate attached to the form of assignment or form of
election to purchase, as the case may be, has not been completed,
the Rights Agent shall not take any further action with respect
to such requested exercise of transfer without first consulting
with the Corporation.
Section 21. CHANGE OF RIGHTS AGENT. The Rights Agent
or any successor Rights Agent may resign and be discharged from
its duties under this Agreement upon thirty (30) days' notice in
writing mailed to the Corporation and to each transfer agent of
the Preferred Shares or Common Shares by registered or certified
mail, and to the holders of the Right Certificates by first-class
mail. The Corporation may remove the Rights Agent or any
successor Rights Agent upon sixty (60) days' notice in writing,
mailed to the Rights Agent or successor Rights Agent, as the case
may be, and to each transfer agent of the Preferred Shares or
Common Shares by registered or certified mail, and to 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 Corporation shall appoint a successor to the Rights
Agent. If the Corporation shall fail to make such appointment
within a
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period of sixty (60) 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 Corporation), 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 Corporation or by such a court,
shall be a corporation organized and doing business under the
laws of the United States or of the State of New York or the
Commonwealth of Massachusetts (or of any other state of the
United States so long as such corporation is authorized to do
business as a banking institution in the State of New York or the
Commonwealth of Massachusetts), in good standing, having a
principal office in the State of New York or the Commonwealth of
Massachusetts, 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 $100,000,000. After
appointment, the successor Rights Agent shall be vested with the
same powers, rights, duties and responsibilities as if it had
been originally named as Rights Agent without further act or
deed; but the predecessor Rights Agent shall deliver and transfer
to the successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment the Corporation
shall file notice thereof in writing with the predecessor Rights
Agent and each transfer agent of the Preferred Shares or Common
Shares and mail a notice thereof in writing to the registered
holders of the Right Certificates. Failure to give any notice
provided for in this Section 21, however, or any defect therein,
shall not affect the legality or validity of the resignation or
removal of the Rights Agent or the appointment of the successor
Rights Agent, as the case may be.
Section 22. ISSUANCE OF NEW RIGHT CERTIFICATES.
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Corporation may, at its option, issue
new Right Certificates evidencing Rights in such form as may be
approved by its Board of Directors to reflect any adjustment or
change in the Purchase Price and the number or kind or class of
shares or other securities or property purchasable under the
Right Certificates made in accordance with the provisions of this
Agreement.
In addition, in connection with the issuance or sale of
Common Shares following the Distribution Date and prior to the
earliest of the Redemption Date, the Final Expiration Date and
the consummation of a transaction contemplated by Section 13(d)
hereof, the Corporation (a) shall with respect to Common Shares
so issued or sold pursuant to the exercise of stock options or
under any employee plan or arrangement, or upon the exercise,
conversion or exchange of securities, notes or debentures issued
by the Corporation, and (b) may, in any other case, if deemed
necessary or appropriate by the Board of Directors of the
Corporation, issue Right Certificates representing the
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appropriate number of Rights in connection with such issuance or
sale; provided, however, that no Right Certificate shall be
issued if, and to the extent that, appropriate adjustment shall
otherwise have been made in lieu of the issuance thereof.
Section 23. REDEMPTION AND TERMINATION. (a) (i) The
Board of Directors of the Corporation may, at its option, redeem
all but not less than all the then outstanding Rights at a
redemption price of $.01 per Right, as such amount may be
appropriately adjusted to reflect any stock split, stock dividend
or similar transaction occurring after the date hereof (such
redemption price being hereinafter referred to as the "Redemption
Price"), at any time prior to the earlier of (x) the close of
business on the tenth day after the Shares Acquisition Date, or
(y) the Final Expiration Date. The Corporation shall pay the
Redemption Price in cash. Notwithstanding anything contained in
this Agreement to the contrary, the Rights shall not be
exercisable pursuant to Section 11(a)(ii) prior to the expiration
of the Corporation's right of redemption hereunder.
(ii) In addition, the Board of Directors of the
Corporation may, at its option, at any time following a Shares
Acquisition Date but prior to any Section 13 Event redeem all but
not less than all of the then outstanding Rights at the
Redemption Price in connection with any Section 13 Event in which
all holders of Common Shares are treated alike and not involving
(other than as a holder of Common Shares being treated like all
other such holders) an Interested Stockholder.
(b) In the case of a redemption permitted under
Section 23(a)(i), immediately upon the date for redemption set
forth (or determined in the manner specified in) in a resolution
of the Board of Directors of the Corporation ordering the
redemption of the Rights, evidence of which shall have been filed
with the Rights Agent, and without any further action and without
any notice, the right to exercise the Rights will terminate and
the only right thereafter of the holders of Rights shall be to
receive the Redemption Price for each Right so held. In the case
of a redemption permitted only under Section 23(a)(ii), evidence
of which shall have been filed with the Rights Agent, the right
to exercise the Rights will terminate and represent only the
right to receive the Redemption Price upon the later of ten
Business Days following the giving of notice (which notice may
state that such redemption is subject to a specified future
contingency) or the expiration of any period during which the
rights under Section 11(a)(ii) may be exercised. The Corporation
shall promptly give public notice of any such redemption;
provided, however, that the failure to give, or any defect in,
any such notice shall not affect the validity of such redemption.
Within ten (10) days after such date for redemption set forth in
a resolution of the Board of Directors ordering the redemption of
the Rights, the Corporation 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 Shares. Any notice which is
mailed in the manner herein provided shall
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be deemed given, whether or not the holder receives the notice.
Each such notice of redemption will state the method by which the
payment of the Redemption Price will be made. Neither the
Corporation nor any of its Affiliates or Associates may redeem,
acquire or purchase for value any Rights at any time in any manner
other than that specifically set forth in this Section 23 and
other than in connection with the purchase of Common Shares prior
to the Distribution Date.
(c) In the case of a redemption permitted under
Section 23(a)(i), the Corporation may, at its option,
discharge all of its obligations with respect to the Rights by
(i) issuing a press release announcing the manner of redemption
of the Rights in accordance with this Agreement and (ii) mailing
payment of the Redemption Price to the registered holders of the
Rights at their last addresses as they appear on the registry
books of the Rights Agent or, prior to the Distribution Date, on
the registry books of the Transfer Agent of the Common Shares,
and upon such action, all outstanding Rights and Right
Certificates shall be null and void without any further action by
the Corporation.
Section 24. EXCHANGE. (a) The Board of Directors of
the Corporation may, at its option, at any time after the time
that any Person becomes an Acquiring Person, exchange all or part
of the then outstanding and exercisable Rights (which shall not
include Rights that have become void pursuant to the provisions
of Section 7(e) and Section 11(a)(ii) hereof) for Common Shares
of the Corporation at an exchange ratio of one Common Share per
Right, appropriately adjusted to reflect any stock split, stock
dividend or similar transaction involving either the Common
Shares or the Preferred Shares occurring after the date hereof
(such exchange ratio being hereinafter referred to as the
"Exchange Ratio"). Notwithstanding the foregoing, the Board of
Directors shall not be empowered to effect such exchange at any
time after any Person (other than the Corporation, any Subsidiary
of the Corporation, any employee benefit plan of the Corporation
or any such Subsidiary, any entity holding Common Shares for or
pursuant to the terms of any such plan or any trustee,
administrator or fiduciary of such a plan), together with all
Affiliates and Associates of such Person, becomes the Beneficial
Owner of 50% or more of the Common Shares then outstanding.
(b) Immediately upon the action of the Board of
Directors of the Corporation ordering the exchange of any Rights
pursuant to subsection (a) of this Section 24 and without any
further action and without any notice, the right to exercise such
rights shall terminate and the only right thereafter of a holder
of such Rights shall be to receive that number of Common Shares
equal to the number of such rights held by such holder multiplied
by the Exchange Ratio. The Corporation 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 Corporation promptly shall
mail a notice of any such exchange to all of the holders of such
Rights at their last addresses as they appear upon the registry
books of the Rights Agent. Any
35
<PAGE> 41
notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice.
Each such notice of exchange will state the method by which
the exchange of the Common Shares for Rights will be effected
and, in the event of any partial exchange, the number of Rights
which will be exchanged. Any partial exchange shall be effected
pro rata based on the number of Rights (other than Rights which
have become void pursuant to the provisions of Section 7(e) and
Section 11(a)(ii) hereof) held by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the
Corporation, at its option, may substitute Preferred Shares (or
equivalent preferred shares, as such term is defined in Section
11(b) hereof) for some or all of the Common Shares exchangeable
for Rights, at the initial rate of one-hundredth of a Preferred
Share (or equivalent preferred share) for each Common Share, as
appropriately adjusted to reflect adjustments in the voting
rights of the Preferred Shares pursuant to the terms thereof, so
that the fraction of a Preferred Share delivered in lieu of each
Common Share shall have the same voting rights as one Common
Share.
(d) The Board of Directors of the Corporation shall
not authorize any exchange transaction referred to in
Section 24(a) hereof unless at the time such exchange is
authorized there shall be sufficient Common Shares or Preferred
Shares issued but not outstanding or authorized but unissued to
permit the exchange of Rights as contemplated in accordance with
this Section 24.
Section 25. NOTICE OF CERTAIN EVENTS. (a) In case
the Corporation shall propose (i) to pay any dividend payable in
stock of any class to the holders of its Preferred Shares or to
make any other distribution to the holders of its Preferred
Shares (other than a regularly quarterly cash dividend), (ii) to
offer to the holders of its Preferred Shares rights or warrants
to subscribe for or to purchase any additional Preferred Shares
or shares of stock of any class or any other securities, rights
or options, (iii) to effect any reclassification of its Preferred
Shares (other than a reclassification involving only the
subdivision of outstanding Preferred Shares), (iv) to effect any
consolidation or merger into or with any other Person (other than
a Subsidiary of the Corporation in a transaction which does not
violate Section 11(o) hereof), or to effect any sale or other
transfer (or to permit one or more of its Subsidiaries to effect
any sale or other transfer) in one or more transactions, of 50%
or more of the assets or earning power of the Corporation and its
Subsidiaries (taken as a whole) to any other Person or Persons
(other than the Corporation and/or any of its Subsidiaries in one
or more transactions each of which does not violate Section 11(o)
hereof), or (v) to effect the liquidation, dissolution or winding
up of the Corporation, then, in each such case, the Corporation
shall give to each holder of a Right Certificate, in accordance
with Section 26 hereof, a notice of such proposed action to the
extent feasible and file a certificate with the Rights Agent to
that effect, which shall specify the record date for the purposes
of such stock dividend, or distribution of rights or
36
<PAGE> 42
warrants, or the date on which such reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution,
or winding up is to take place and the date of participation
therein by the holders of the Preferred Shares, if any such date
is to be fixed, and such notice shall be so given in the case
of any action covered by clause (i) or (ii) above at least twenty
(20) days prior to the record date for determining holders of the
Preferred Shares for purposes of such action, and in the case of
any such other action, at least twenty (20) days prior to the
date of the taking of such proposed action or the date of
participation therein by the holders of the Preferred Shares,
which ever shall be the earlier.
(b) In case of a Section 11(a)(ii) Event, then (i) the
Corporation shall as soon as practicable thereafter give to each
holder of a Right Certificate, in accordance with Section 26
hereof, a notice of the occurrence of such event, which notice
shall describe such event and the consequences of such event to
holders of Rights under Section 11(a)(ii) hereof and (ii) all
references in the preceding paragraph (a) to Preferred Shares
shall be deemed thereafter to refer also, if appropriate, to
Common Shares and/or, if appropriate, other securities of the
Corporation.
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 Corporation 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:
Cabot Corporation
75 State Street
Boston, Massachusetts 02109-1806
Attention: Secretary
Subject to the provisions of Section 21 hereof, any notice or
demand authorized by this Agreement to be given or made by the
Corporation 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 Corporation) as follows:
The First National Bank of Boston
Mail Stop 45-02-16
150 Royall Street
Canton, Massachusetts 02021
Attention: Client Administration
Notices or demands authorized by this Agreement to be given or
made by the Corporation or the Rights Agent to the holder of any
Right Certificate or, if prior to the Distribution
37
<PAGE> 43
Date, to the holder of certificates representing Common Shares shall be
sufficiently given or made if sent by first-class mail, postage
prepaid, addressed to such holder at the address of such holder
as shown on the registry books of the Corporation.
Section 27. SUPPLEMENTS AND AMENDMENTS. Prior to the
Distribution Date, the Corporation and the Rights Agent shall, if
the Corporation so directs, supplement or amend any provision of
this Agreement without the approval of any holders of
certificates representing Common Shares. From and after the
Distribution Date, the Corporation and the Rights Agent shall, if
the Corporation so directs, supplement or amend this Agreement
without the approval of any holders of Right Certificates in
order (i) to cure any ambiguity, (ii) to correct or supplement
any provision contained herein which may be defective or
inconsistent with any other provisions herein, (iii) to shorten
or lengthen any time period hereunder or (iv) to change or
supplement the provisions hereunder in any manner which the
Corporation may deem necessary or desirable and which shall not
adversely affect the interests of the holders of Right
Certificates (other than an Acquiring Person or an Affiliate or
Associate of an Acquiring Person); provided, however, that this
Agreement may not be supplemented or amended to lengthen,
pursuant to clause (iii) of this sentence, (A) a time period
relating to when the Rights may be redeemed at such time as the
Rights are not then redeemable, or (B) any other time period
unless such lengthening is for the purpose of protecting,
enhancing or clarifying the rights of, and/or the benefits to,
the holders of Rights. Upon the delivery of a certificate from
an appropriate officer of the Corporation which states that the
proposed supplement or amendment is in compliance with the terms
of this Section 27, the Rights Agent shall execute such
supplement or amendment, provided that such supplement or
amendment does not adversely affect the rights or obligations of
the Rights Agent under Section 18 or Section 20 of this
Agreement. Prior to the Distribution Date, the interests of the
holders of Rights shall be deemed coincident with the interests
of the holders of Common Shares.
Section 28. DETERMINATION AND ACTIONS BY THE BOARD OF
DIRECTORS, ETC. The Board of Directors of the Corporation shall
have the exclusive power and authority to administer this
Agreement and to exercise all rights and powers specifically
granted to the Board, or the Corporation, 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 the Agreement and
whether any proposed amendment adversely affects the interests of
the holders of Right Certificates). For all purposes of this
Agreement, any calculation of the number of Common Shares or
other securities outstanding at any particular time, including
for purposes of determining the particular percentage of such
outstanding Common Shares or any other securities 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
38
<PAGE> 44
Regulations under the Exchange Act as in effect on the date of
this Agreement. All such actions, calculations, interpretations
and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing) which are done or
made by the Board in good faith, shall (x) be final, conclusive
and binding on the Corporation, the Rights Agent, the holders of
the Right Certificates and all other parties, and (y) not subject
the Board to any liability to the holders of the Right
Certificates.
Section 29. SUCCESSORS. All the covenants and
provisions of this Agreement by or for the benefit of the
Corporation or the Rights Agent shall bind and inure to the
benefit of their respective successors and assigns hereunder.
Section 30. BENEFITS OF THIS AGREEMENT. Nothing in
this Agreement shall be construed to give to any person or
corporation other than the Corporation, the Rights Agent and the
registered holders of the Right Certificates (and, prior to the
Distribution Date, the Common Shares) any legal or equitable
right, remedy or claim under this Agreement; but this Agreement
shall be for the sole and exclusive benefit of the Corporation,
the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the Common
Shares).
Section 31. SEVERABILITY. If any term, provision,
covenant or restriction of this Agreement is held by a court of
competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants
and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated;
provided, however, that notwithstanding anything in this
Agreement to the contrary, if any such term, provision, covenant
or restriction is held by such court or authority to be invalid,
void or unenforceable and the Board of Directors of the
Corporation determines in its good faith judgment that severing
the invalid language from this Agreement would adversely affect
the purpose or effect of this Agreement, the right of redemption
set forth in Section 23 hereof shall be reinstated and shall not
expire until the close of business on the tenth day following the
date of such determination by the Board of Directors.
Section 32. GOVERNING LAW. This Agreement, each Right
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.
39
<PAGE> 45
Section 34. DESCRIPTIVE HEADINGS. Descriptive
headings of the several Sections of this Agreement are inserted
for convenience only and shall not control or affect the meaning
or construction of any of the provisions hereof.
40
<PAGE> 46
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and attested, all as of the date
and year first above written.
CABOT CORPORATION
By /s/ Kennett F. Burnes
--------------------------
Name: Kennett F. Burnes
Title: President
THE FIRST NATIONAL BANK OF BOSTON
By /s/ Katherine S. Anderson
---------------------------------
Name: Katherine S. Anderson
Title: Administration Manager
41
<PAGE> 47
Exhibit A
---------
Form of Right Certificate
Certificate No. R- ______ Rights
NOT EXERCISABLE AFTER NOVEMBER 10, 2005, OR EARLIER IF
REDEEMED BY THE CORPORATION. THE RIGHTS ARE SUBJECT TO
REDEMPTION AT $.01 PER RIGHT ON THE TERMS SET FORTH IN
THE RIGHTS AGREEMENT.
UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS
AGREEMENT, RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO
IS, WAS OR BECOMES AN ACQUIRING PERSON OR AN AFFILIATE
OR ASSOCIATE THEREOF (AS DEFINED IN THE RIGHTS
AGREEMENT) AND CERTAIN RELATED PERSONS, WHETHER
CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR BY ANY
SUBSEQUENT HOLDER, SHALL BECOME NULL AND VOID.
Right Certificate
Cabot Corporation
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
November 10, 1995 (the "Rights Agreement"), between Cabot
Corporation, a Delaware corporation (the "Corporation"), and The
First National Bank of Boston (the "Rights Agent"), to purchase
from the Corporation at any time after the Distribution Date (as
such term is defined in the Rights Agreement) and prior to 5:00
P.M., Boston, Massachusetts time, on November 10, 2005, unless
the Rights evidenced hereby shall have been previously redeemed
by the Corporation, at the principal office or offices of the
Rights Agent designated for such purpose, or at the office of its
successor as Rights Agent, one one-hundredth of a fully paid non-
assessable share of Series A Junior Participating Preferred
Stock, with a par value of $1.00 per share (the "Preferred
Shares"), of the Corporation, at a purchase price of $200 per one
one-hundredth of a Preferred Share (the
<PAGE> 48
"Purchase Price"), upon presentation and surrender of this Right
Certificate with the Form of Election to Purchase duly executed.
The number of Rights evidenced by this Right Certificate (and
the number of one one-hundredths of a Preferred Share 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 November 24, 1995 based on the Preferred Shares as
constituted at such date.
Upon the occurrence of a Section 11(a)(ii) Event (as
such term is defined in the Rights Agreement), if the Rights
evidenced by this Right Certificate are beneficially owned by (i)
an Acquiring Person or an Affiliate or Associate of any such
Acquiring Person (as such terms are defined in the Rights
Agreement), (ii) a transferee of any such Acquiring Person,
Associate or Affiliate who becomes a transferee after the
Acquiring Person becomes such, or (iii) under certain
circumstances specified in the Rights Agreement, a transferee of
any such Acquiring Person, Associate or Affiliate who becomes a
transferee prior to or concurrently with the Acquiring Person
becoming such, such Rights shall become null and void and no
holder hereof shall have any right with respect to such Rights
from and after the occurrence of such Section 11(a)(ii) Event.
As provided in the Rights Agreement, the Purchase Price
and the number of one one-hundredths of a Preferred Share or
other securities which may be purchased upon the exercise of the
Rights evidenced by this Right Certificate are subject to
modification and adjustment upon the happening of certain events,
including Triggering Events (as such term is defined in the
Rights Agreement).
This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights 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 Corporation and the holders of
the Right Certificates, which limitations of rights include the
temporary suspension of the exercisability of such Rights under
the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the principal
executive offices of the Corporation and the principal office or
offices of the Rights Agent.
This Right Certificate, with or without other Right
Certificates, upon surrender at the principal office of the
Rights Agent, 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
Preferred Shares or other securities 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
A-2
<PAGE> 49
holder shall be entitled to receive upon surrender hereof another
Right Certificate or Right Certificates for the number of whole
Rights not exercised.
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate may be redeemed by the
Corporation at a redemption price of $.01 per Right (subject to
adjustment as provided in the Rights Agreement) payable in Common
Shares or cash.
The Corporation shall not be required to issue
fractions of Rights or to distribute Right Certificates which
evidence fractional Rights. In lieu of such fractional Rights,
there shall be paid to the registered holders of the Right
Certificates with regard to which such fractional Rights would
otherwise be issuable, an amount in cash equal to the same
fraction of the current market value of a whole Right as defined
in the Rights Agreement.
The Corporation will not be required to issue fractions
of Preferred Shares (other than fractions which are one
one-hundredths or integral multiples of one one-hundredth of a
Preferred Share) upon exercise of the Rights or to distribute
certificates which evidence fractional Preferred Shares (other
than fractions which are one one-hundredths or integral multiples
of one one-hundredth of a Preferred Share). In lieu of
fractional Preferred Shares other than fractions that are
multiples of one one-hundredth of a Share, the Corporation will
pay to the registered holders of Right Certificates at the time
such Rights are exercised an amount in cash equal to the same
fraction of the current market value of one Preferred Share as
defined in the Rights Agreement.
No holder of this Right Certificate shall be entitled
to vote or receive dividends or be deemed for any purpose the
holder of the Preferred Shares or of any other securities of the
Corporation which may at any time be issuable on the exercise
hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such,
any of the rights of a stockholder of the Corporation or any
right to vote for the election of directors or upon any matter
submitted to stockholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting stockholders (except as
provided in the Rights Agreement), or to receive dividends or
other distributions or to exercise any preemptive 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.
A-3
<PAGE> 50
WITNESS the facsimile signature of the proper officers
of the Corporation and its corporate seal. Dated as of
_________, ______.
[SEAL]
ATTEST: CABOT CORPORATION
Attest:
By By
---------------------- -----------------------
Name: Name:
Title: Title:
Countersigned:
THE FIRST NATIONAL BANK OF BOSTON
By
----------------------
Authorized Signatory
Name:
Title:
A-4
<PAGE> 51
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
------------------
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR VALUE RECEIVED ____________________________________________
hereby sells, assigns and transfers unto ______________________
_______________________________________________________________
(Please print name and address of transferee)
_______________________________________________________________
this Right Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and
appoint _________ Attorney, to transfer the within Right
Certificate on the books of the within-named Corporation, with
full power of substitution.
Dated: ____________, _____
______________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank,
savings association, credit union or trust company having an
office or correspondent in the United States or other eligible
guarantor institution which is a participant in a signature
guarantee medallion program.
- -----------------------------------------------------------------
The undersigned hereby certifies that (1) the Rights
evidenced by this Right Certificate are not being sold, assigned
or transferred by or on behalf of a Person who is or was an
Acquiring Person or an Affiliate or Associate thereof (as such
terms are defined in the Rights Agreement) and (2) after due
inquiry and to the best knowledge of the undersigned, the
undersigned did not acquire the Rights evidenced by this Right
Certificate from any Person who is or was an Acquiring Person or
an Affiliate or Associate thereof (as such terms are defined in
the Rights Agreement).
_________________________
Signature
A-5
<PAGE> 52
- -------------------------------------------------------------------
Form of Reverse Side of Right Certificate -- continued
FORM OF ELECTION TO PURCHASE
----------------------------
(To be executed by the registered holder
if such holder desires to exercise Rights
represented by the Right Certificate.)
To the Rights Agent:
The undersigned hereby irrevocably elects to exercise
Rights represented by this Right Certificate to purchase the
Preferred Shares, Common Shares or such other securities issuable
upon the exercise of such Rights at this time as follows:
Please Insert
Number of Rights To Be Exercised
--------------------------------
(i) Preferred Shares Exercise _________
(ii) Section 11(a)(ii) Exercise _________
(iii) Section 13 Exercise _________
The undersigned requests that certificates for such
Preferred Shares, Common Shares or other securities be issued in
the name of:
Please insert social security
or other identifying number ____________________________________
________________________________________________________________
(Please print name and address of transferee)
________________________________________________________________
If such number of Rights shall not be all the Rights evidenced by
this Right Certificate, a new Right Certificate for the balance
remaining of such Rights shall be registered in the name of and
delivered to:
Please insert social security
or other identifying number ____________________________________
________________________________________________________________
(Please print name and address of transferee)
________________________________________________________________
A-6
<PAGE> 53
Dated: _________, 19__
_______________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank,
savings association, credit union or trust company having an
office or correspondent in the United States or other eligible
guarantor institution which is a participant in a signature
guarantee medallion program.
A-7
<PAGE> 54
Form of Reverse Side of Right Certificate -- continued.
- ------------------------------------------------------------------
The undersigned hereby certifies that (1) the Rights
evidenced by this Right Certificate are not being exercised by or
on behalf of a Person who is or was an Acquiring Person or an
Affiliate or Associate thereof (as such terms are defined in the
Rights Agreement) and (2) after due inquiry and to the best
knowledge of the undersigned, the undersigned did not acquire the
Rights evidenced by this Rights Certificate from any Person who
is or was an Acquiring Person or an Affiliate or Associate
thereof (as such terms are defined in the Rights Agreement).
________________________
Signature
- ----------------------------------------------------------------
NOTICE
------
The signature on the foregoing Forms of Assignment and
Election and certificates 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, the Corporation and the Rights
Agent will deem the Beneficial Owner of the Rights evidenced by
this Right Certificate to be an Acquiring Person or an Affiliate
or Associate thereof (as such terms are defined in the Rights
Agreement) and such Assignment or Election to Purchase will not
be honored.
A-8
<PAGE> 55
Exhibit B
---------
SUMMARY OF RIGHTS TO PURCHASE SHARES
UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS
AGREEMENT, RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO IS, WAS
OR BECOMES AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE
THEREOF (AS DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN RELATED
PERSONS, WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR
BY ANY SUBSEQUENT HOLDER, SHALL BECOME NULL AND VOID.
On November 10, 1995, the Board Of Directors of Cabot
Corporation, a Delaware corporation (the "Corporation"), declared
a dividend distribution of one preferred share purchase right (a
"Right") for each outstanding share of Common Stock, par value
$1.00 per share (the "Common Shares"), of the Corporation. The
dividend is payable to the stockholders of record as of 5:00
P.M., Eastern Standard Time, on November 24, 1995 (the "Record
Date"), and with respect to Common Shares issued thereafter until
the Distribution Date (as defined below) and, in certain
circumstances, with respect to Common Shares issued after the
Distribution Date. Except as set forth below, each Right, when
it becomes exercisable, entitles the registered holder to
purchase from the Corporation one one-hundredth of a share of
Series A Junior Participating Preferred Stock, par value $1.00
per share (the "Preferred Shares") at a price of $200 per one one-
hundredth of a Preferred Share (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights are set
forth in a Rights Agreement, dated as of November 10, 1995 (the
"Rights Agreement"), between the Corporation and The First
National Bank of Boston (the "Rights Agent").
Initially, the Rights will be attached to all
certificates representing Common Shares then outstanding, and no
separate Right Certificates (as hereinafter defined) will be
distributed. The Rights will separate from the Common Shares on
the close of business on the tenth day after the earlier to occur
of (i) the first date of public announcement that a person or
"group" (other than a Grandfathered Person, as hereinafter
defined) has acquired beneficial ownership of 15% or more of the
outstanding Common Shares (except pursuant to a Permitted Offer,
as hereinafter defined); or (ii) the date of commencement of, or
announcement of an intention to commence, a tender offer or
exchange offer the consummation of which would result in a person
or group becoming an Acquiring Person (as hereinafter defined)
(such tenth day being called the "Distribution Date"). A person
or group whose acquisition of Common Shares causes a Distribution
Date pursuant to clause (i) above is an "Acquiring Person." The
first date of
<PAGE> 56
public announcement that a person or group has become an
Acquiring Person is the "Shares Acquisition Date."
"Grandfathered Persons" include:
(a) any descendant of Godfrey L. Cabot (the
deceased founder of the Corporation), or any spouse,
widow or widower of any such descendant (any such
descendants, spouses, widows and widowers collectively
defined as the "Cabot Family Members");
(b) any trust (including any voting trust) which
is in existence on the date of this Agreement and which
has been established by Godfrey L. Cabot or one or more
Cabot Family Members, any estate of, or the executor or
administrator of any estate of, or any guardian or
custodian for, a Cabot Family Member who died on or
before the date of this Agreement (such trusts,
estates, executors, administrators or guardians or
custodians collectively defined as the "Cabot Family
Entities");
(c) any estate of, or the executor or
administrator of any estate of, or any guardian or
custodian for, a Cabot Family Member who dies after the
date of this Agreement, or any trust established after
the date hereof by one or more Cabot Family Members or
Cabot Family Entities, provided that one or more Cabot
Family Members or Cabot Family Entities, collectively,
are the beneficiaries of at least 80% of the
actuarially-determined beneficial interests in such
estate or trust;
(d) any charitable organization which qualifies
as an exempt organization under Section 501(c) of the
Internal Revenue Code of 1986, as amended ("Charitable
Organization") which is established by one or more
Cabot Family Members or Cabot Family Entities (a "Cabot
Family Charitable Organization");
(e) any corporation of which at least 80% of the
voting power and at least 80% of the equity interest is
held, directly or indirectly, by or for the benefit of
one or more Cabot Family Members, Cabot Family
Entities, estates, executors, administrators, guardians
or custodians or trusts described in clause (iii)
above, or Cabot Family Charitable Organizations; and
(f) any general partnership, limited partnership,
organization or other entity or arrangement of which at
least 80% of the voting interest and at least 80% of
the economic interest is held, directly or indirectly,
by or for the benefit of one or more Cabot Family
Members, Cabot Family Entities,
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estate, executors, administrators, guardians or
custodians, or trusts described in clause (iii) above,
or Cabot Family Charitable Organizations;
provided, however, that a Grandfathered Person
ceases to be a Grandfathered Person at the time that
all or any part of its interest in the Common Shares
becomes reportable on a Schedule 13D under the
Securities Exchange Act of 1934, as amended (or any
comparable or successor report) as part of a "group"
(as such term is defined or used under Rule 13d-5(b) of
the General Rules and Regulations under the Securities
Exchange Act of 1934, as amended) which beneficially
owns, directly or indirectly, 15% or more of the then
outstanding Common Shares and includes one or more
persons (including any affiliate or associate thereof)
who (i) are not Grandfathered Persons and (ii)
individually or in the aggregate beneficially own,
directly or indirectly, in excess of 1% of the then
outstanding Common Shares.
For purposes of the definition of Grandfathered Person,
the term "descendant" shall be deemed to include adopted
children, and the issue of such adopted children, including
adopted issue, provided that any such adoptee is adopted before
his or her eighteenth birthday.
The Rights Agreement provides that, until the
Distribution Date, the Rights will be transferred with and only
with the Common Shares. Until the Distribution Date (or earlier
redemption or expiration of the Rights) new Common Share
certificates issued after the Record Date upon transfer or new
issuance of Common Shares will contain a notation incorporating
the Rights Agreement by reference. Until the Distribution Date
(or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for Common Shares
outstanding as of the Record Date, even without such notation or
a copy of this Summary of Rights being attached thereto, will
also constitute the transfer of the Rights associated with the
Common Shares 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 Shares as of the close
of business on the Distribution Date (and to each initial record
holder of certain Common Shares issued after the Distribution
Date), and such separate Right Certificates alone will evidence
the Rights.
The rights are not exercisable until the Distribution
Date and will expire at 5:00 P.M., Boston, Massachusetts time, on
November 10, 2005, unless earlier redeemed by the Corporation as
described below.
In the event that any person becomes an Acquiring
Person (except pursuant to a Permitted Offer as defined below),
or if a Section 13(a)(z) Event (as hereinafter
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<PAGE> 58
defined) occurs, each holder of a Right will have (subject to the
terms of the Rights Agreement) the right (the "Flip-In Right") to
receive upon exercise the number of Common Shares, or, in the
discretion of the Board of Directors, one one-hundredths of a
Preferred Share (or, in certain circumstances, other securities
of the Corporation) having a value (immediately prior to such
triggering event) equal to two times the exercise price of the
Right. Notwithstanding the foregoing, following the occurrence of
the event described above, all Rights that are, or (under certain
circumstances specified in the Rights Agreement) were, beneficially
owned by any Acquiring Person or any affiliate or associate thereof
will be null and void. A "Permitted Offer" is a tender or exchange
offer for all outstanding Common Shares which is at a price and on
terms determined, prior to the purchase of shares under such tender
or exchange offer, by the Board of Directors to be adequate (taking
into account all factors that such Directors deem relevant) and
otherwise in the best interests of the Corporation, its stockholders
and its other relevant constituencies (other than the person or any
affiliate or associate thereof on whose basis the offer is being
made) taking into account all factors that such directors may deem
relevant.
If the Corporation does not have sufficient treasury
stock or authorized and unissued Common Shares fully to honor the
Rights, holders will be entitled to purchase the maximum number
of Common Shares issuable and one one-hundredth of a Preferred
Share, and the Corporation may issue additional Common Shares or
other equity or debt securities upon exercise of the Rights. If
the Corporation is unable to make sufficient Common Shares or
other equity or debt available, the rights of holders to purchase
Common Shares may be proportionately reduced. Under certain
circumstances, the Board, at its option may also issue Common
Shares in exchange for all or part of the exercisable Rights
after the Distribution Date at the rate of one Common Share for
each Right.
In the event that, at any time following the Shares
Acquisition Date, (i) the Corporation is acquired in a merger or
other business combination transaction in which the holders of
all of the outstanding Common Shares immediately prior to the
consummation of the transaction are not the holders of all of the
surviving corporation's voting power, or (ii) (herein referred to
as a Section 13(a)(z) Event) more than 50% of the Corporation's
assets or earning power is sold or transferred, in either case
with or to an Acquiring Person or any affiliate or associate or
any other person in which such Acquiring Person, affiliate or
associate has an interest or any person acting on behalf of or in
concert with such Acquiring Person, affiliate or associate, or,
if in such transaction all holders of Common Shares are not
treated alike, any other person, then each holder of a Right
(except Rights which previously have been voided as set forth
above) shall thereafter have the right (the "Flip-Over Right") to
receive, upon exercise, common shares of the acquiring company
having a value equal to two times the exercise price of the
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<PAGE> 59
Right. The holder of a Right will continue to have the Flip-Over
Right whether or not such holder exercises or surrenders the Flip-
In Right.
The Purchase Price payable, and the number of one-
hundredths of a Preferred Share or other securities 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 Shares, (ii) upon the grant to holders of the Preferred
Shares of certain rights or warrants to subscribe for or purchase
Preferred Shares at a price, or securities convertible into
Preferred Shares with a conversion price, less than the then
current market price of the Preferred Shares or (iii) upon the
distribution to holders of the Preferred Shares of evidences of
indebtedness or assets (excluding regular quarterly cash
dividends) or of subscription rights or warrants (other than
those referred to above).
The Purchase Price is also subject to adjustment in the
event of a stock split of the Common Shares or a stock dividend
on the Common Shares payable in Common Shares or subdivisions,
consolidations or combinations of the Common Shares occurring, in
any such case, prior to the Distribution Date.
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
one-hundredths of a Preferred Share will be issued and in lieu
thereof, an adjustment in cash will be made based on the market
price of the Preferred Shares on the last trading day price to
the date of exercise.
Preferred Shares purchasable upon exercise of the
Rights will not be redeemable. Each Preferred Share will be
entitled to a minimum preferential quarterly dividend payment of
$18.00 per share but, if greater, will be entitled to an
aggregate dividend per share of 100 times the dividend declared
per Common Share. In the event of liquidation, the holders of
the Preferred Shares will be entitled to a minimum preferential
liquidation payment of $18.00 per share; thereafter, and after
the holders of the Common Shares receive a liquidation payment of
$0.18 per share, the holders of the Preferred Shares and the
holders of the Common Shares will share the remaining assets in
the ratio of one hundred to 1 (as adjusted) for each Preferred
Share and Common Share so held, respectively. Finally, in the
event of any merger, consolidation or other transaction in which
Common Shares are exchanged, each Preferred Share will be
entitled to receive one hundred times the amount received per
Common Share. These rights are protected by customary
antidilution provisions. In the event that the amount of accrued
and unpaid dividends on the Preferred Shares is equivalent to at
least six full quarterly dividends, the holders of the Preferred
Shares shall have the right, voting as a class, to elect two
directors in addition to the directors elected by the holders of
the Common Shares until all cumulative dividends on the Preferred
Shares have been paid through the last quarterly
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<PAGE> 60
dividend payment date or until non-cumulative dividends have been
paid regularly for at least one year.
At any time prior to the earlier to occur of (i) the
close of business on the tenth day following the Shares
Acquisition Date or (ii) the expiration of the Rights, and under
certain other circumstances, the Corporation may redeem the
Rights in whole, but not in part, at a redemption price of $.01
per Right (the "Redemption Price"). Additionally, following the
Shares Acquisition Date, the Corporation may redeem the then
outstanding Rights in whole, but not in part, at the Redemption
Price, provided that such redemption is in connection with a
merger or other business combination transaction or series of
transactions involving the Corporation in which all holders of
Common Shares are treated alike but not involving an Interested
Stockholder (as defined in the Rights Agreement).
All of the provisions of the Rights Agreement may be
amended by the Board of Directors of the Corporation prior to the
Distribution Date. After the Distribution Date, the provisions
of the Rights Agreement may be amended in order to cure any
ambiguity, defect or inconsistency, to make changes which do not
adversely affect the interests of holders of Rights (excluding
the interests of any Acquiring Person), or, subject to certain
limitations, to shorten or lengthen any time period under the
Rights Agreement.
Until a Right is exercised, the holder thereof, as
such, will have no rights as a stockholder of the Corporation,
including, without limitation, the right to vote or to receive
dividends. While the distribution of the Rights will not be
taxable to stockholders of the Corporation, stockholders may,
depending upon the circumstances, recognize taxable income should
the Rights become exercisable or upon the occurrence of certain
events thereafter.
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Exhibit C
---------
AMENDED CERTIFICATE OF DESIGNATION, PREFERENCES AND
RIGHTS OF SERIES A JUNIOR PARTICIPATING
PREFERRED STOCK OF CABOT CORPORATION
(Pursuant to Section 151
of the General Corporation Law of the State of Delaware)
We, Kennett F. Burnes, President, and Charles D.
Gerlinger, Secretary of Cabot Corporation (the "Corporation"), a
corporation organized and existing under the General Corporation
Law of the State of Delaware, in accordance with the provisions
of Section 103 thereof, DO HEREBY CERTIFY as follows:
That pursuant to the authority conferred upon the Board
of Directors by the Certificate of Incorporation of the said
Corporation, said Board of Directors on November 10, 1995, voted
to create a series of 1,000,000 shares of Preferred Stock
designated as Series A Junior Participating Preferred Stock:
VOTED, that pursuant to the authority granted to and
vested in the Board of Directors of this Corporation in
accordance with the provisions of the Corporation's Certificate
of Incorporation and Section 151(g) of the General Corporation
Law of the State of Delaware, the Board of Directors hereby
approves and adopts an amendment to the Certificate of
Designation, Preferences and Rights of the Series A Junior
Participating Preferred Stock of Cabot Corporation, which
Certificate is hereby amended in its entirety, and hereby states
the designation and number of shares, and fixes the relative
rights, preferences and limitations thereof (in addition to the
provisions set forth in the Corporation's Certificate of
Incorporation which are applicable to the Preferred Stock of all
classes and series) as follows:
Section 1. DESIGNATION AND AMOUNT. There shall be a
series of Preferred Stock, par value $1.00 per share, of the
Corporation which shall be designated as "Series A Junior
Participating Preferred Stock," par value $1.00 per share, and
the number of shares constituting such series shall be 1,000,000.
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 A Junior Participating
Preferred Stock to a number less than that of the shares then
outstanding plus the number of shares issuable upon exercise of
outstanding rights, options or warrants or upon conversion of
outstanding securities issued by the Corporation.
<PAGE> 62
Section 2. DIVIDENDS AND DISTRIBUTIONS.
(A) Subject to the prior and superior rights of the
holders of any shares of any series of Preferred Stock ranking
prior and superior to the Series A Junior Participating Preferred
Stock with respect to dividends, the holders of shares of Series
A Junior Participating Preferred Stock in preference to the
holders of shares of Common Stock, par value $1.00 per share (the
"Common Stock"), of the Corporation and any other junior 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 of
each fiscal quarter of the Corporation in each year or such other
dates as the Board of Directors of the Corporation shall approve
(each such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a
share of Series A Junior Participating Preferred Stock in an
amount per share (rounded to the nearest cent) equal to the
greater of (a) $18.00 or (b) subject to the provision for
adjustment hereinafter set forth, 100 times the aggregate per
share amount of all cash dividends, and 100 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 or a subdivision of the outstanding shares of Common
Stock (by reclassification or otherwise), declared on the Common
Stock since the immediately preceding Quarterly Dividend Payment
Date, or, with respect to the first Quarterly Dividend Payment
Date, since the first issuance of any share or fraction of a
share of Series A Junior Participating Preferred Stock. In the
event the Corporation shall at any time after November 24, 1995
(the "Rights Declaration Date") (i) declare any dividend on
Common Stock payable in shares of Common Stock, (ii) subdivide
(by a stock split or otherwise) the outstanding Common Stock, or
(iii) combine (by a reverse stock split or otherwise) the
outstanding Common Stock into a smaller number of shares, then in
each such case the amount to which holders of shares of Series A
Junior Participating Preferred Stock were entitled immediately
prior to such event under clause (b) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or
distribution on the Series A Junior Participating Preferred Stock
as provided in paragraph (A) above at the time 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 Quarterly Dividend
Payment Date and the next subsequent Quarterly Dividend Payment
Date, a dividend of $18.00 per share on the Series A Junior
Participating Preferred Stock shall nevertheless be payable on
such subsequent Quarterly Dividend Payment Date.
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(C) So long as any shares of the Series A Junior
Participating Preferred Stock are outstanding, no dividends or
other distributions shall be declared, paid or distributed, or
set aside for payment or distribution, on the Common Stock
unless, in each case, the dividend required by this Section 2 to
be declared on the Series A Junior Participating Preferred Stock
shall have been declared.
(D) The holders of the shares of the Series A Junior
Participating Preferred Stock shall not be entitled to receive
any dividends or other distributions except as provided herein.
(E) Dividends shall begin to accrue and be cumulative
on outstanding shares of Series A Junior Participating Preferred
Stock from the Quarterly Dividend Payment Date next preceding the
date of issue of such shares of Series A Junior Participating
Preferred Stock unless the date of issue of such shares is prior
to the record date for the first Quarterly Dividend Payment Date,
in which case dividends on such shares shall begin to accrue from
the date of issue of such shares, or unless the date of issue is
a Quarterly Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series A
Junior Participating Preferred Stock entitled to receive a
quarterly dividend and before such Quarterly Dividend Payment
Date in either of which events such dividends shall begin to
accrue and be cumulative from such Quarterly Dividend Payment
Date. Accrued but unpaid dividends shall not bear interest.
Dividends paid on the shares of Series A Junior Participating
Preferred Stock in an amount less than the total 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
A Junior Participating Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which
record date shall be no more than 60 days prior to the date fixed
for the payment thereof.
Section 3. VOTING RIGHTS. The holders of shares of
Series A Junior Participating Preferred Stock shall have the
following voting rights:
(A) Subject to the provision for adjustment
hereinafter set forth, each share of Series A Junior
Participating Preferred Stock shall entitle the holder thereof to
100 votes on all matters submitted to a vote of the stockholders
of the Corporation. In the event the Corporation shall at any
time after the Rights Declaration Date (i) declare any dividend
on Common Stock payable in shares of Common Stock, (ii) subdivide
(by a stock split or otherwise) the outstanding Common Stock, or
(iii) combine (by a reverse stock split or otherwise) the
outstanding Common Stock into a smaller number of shares, then in
each such case the number of votes per share to which holders of
shares of Series A Junior Participating 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
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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) Except as otherwise provided herein or by law, the
holders of shares of Series A Junior Participating Preferred
Stock and the holders of shares of Common Stock shall vote
together as one class on all matters submitted to a vote of
stockholders of the Corporation.
(C) (i) If at any time dividends on any Series A
Junior Participating Preferred Stock shall be in arrears in an
amount equal to at least six (6) full quarterly dividends
(whether or not declared and whether or not consecutive) thereon,
the occurrence of such contingency shall mark the beginning of a
period (herein called a "default period") which shall extend
until such time when all accrued and unpaid dividends for all
previous quarterly dividend periods and for the current quarterly
dividend period on all shares of Series A Junior Participating
Preferred Stock then outstanding shall have been declared and
paid or set apart for payment. During each default period, all
holders of Preferred Stock (including holders of the Series A
Junior Participating Preferred Stock) with dividends in arrears
in an amount equal to at least six (6) full quarterly dividends
(whether or not declared and whether or not consecutive) thereon,
voting as a class, irrespective of series, shall have the right
to elect two (2) Directors.
(ii) During any default period, such voting right
of the holders of Series A Junior Participating Preferred Stock
may be exercised initially at a special meeting called pursuant
to subparagraph (iii) of this Section 3(C) or at any annual
meeting of stockholders, and thereafter at annual meetings of
stockholders, provided that neither such voting right nor the
right of the holders of any other series of Preferred Stock, if
any, to increase, in certain cases, the authorized number of
Directors shall be exercised unless the holders of one-third
(1/3) in number of shares of Preferred Stock outstanding shall be
present in person or by proxy. The absence of a quorum of the
holders of Common Stock shall not affect the exercise by the
holders of Preferred Stock of such voting right. At any meeting
at which the holders of Preferred Stock shall exercise such
voting right initially during an existing default period, they
shall have the right, voting as a class, to elect Directors to
fill such vacancies, if any, in the Board of Directors as may
then exist up to two (2) Directors or, if such right is exercised
at an annual meeting, to elect two (2) Directors. If the number
which may be so elected at any special meeting does not amount to
the required number, the holders of the Preferred Stock shall
have the right to make such increase in the number of Directors
as shall be necessary to permit the election by them of the
required number. After the holders of the Preferred Stock shall
have exercised their right to elect Directors in any default
period and during the continuance of such period, the number of
directors shall not be increased
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or decreased except by vote of the holders of Preferred Stock
as herein provided or pursuant to the rights of any equity
securities ranking senior to or pari passu with the Series A
Junior Participating Preferred Stock.
(iii) Unless the holders of Preferred Stock
shall, during an existing default period, have previously
exercised their right to elect Directors, the Board of Directors
may order, or any stockholder or stockholders owning in the
aggregate not less than ten percent (10%) of the total number of
Preferred Stock outstanding, irrespective of series, may request,
the calling of a special meeting of the holders of Preferred
Stock, which meeting shall thereupon be called by the Chairman of
the Board or the President of the Corporation. Notice of such
meeting and of any annual meeting at which holders of Preferred
Stock are entitled to vote pursuant to this paragraph (C)(iii)
shall be given to each holder of record of Preferred Stock by
mailing a copy of such notice to him at his last address as the
same appears on the books of the Corporation. Such meeting shall
be called for a time not earlier than 10 days and not later than
60 days after such order or request or in default of the calling
of such meeting within 60 days after such order or request, such
meeting may be called on similar notice by any stockholder or
stockholders owning in the aggregate not less than ten percent
(10%) of the total number of shares of Preferred Stock
outstanding. Notwithstanding the provisions of this paragraph
(C)(iii), no such special meeting shall be called during the
period within 60 days immediately preceding the date fixed for
the next annual meeting of the stockholders.
(iv) In any default period, the holders of Common
Stock, and other classes of stock of the Corporation if
applicable, shall continue to be entitled to elect the whole
number of Directors until the holders of Preferred Stock shall
have exercised their right to elect two (2) Directors voting as a
class, after the exercise of which right (x) the Directors so
elected by the holders of Preferred Stock shall continue in
office until their successors shall have been elected by such
holders or until the expiration of the default period, and (y)
any vacancy in the Board of Directors may (except as provided in
paragraph (C)(ii) of this Section 3) be filled by a vote of a
majority of the remaining Directors theretofore elected by the
holders of the class of stock which elected the Director whose
office shall become vacant. References in this paragraph (C) to
Directors elected by the holders of a particular class of stock
shall include Directors elected by such Directors to fill
vacancies as provided in clause (y) of the foregoing sentence.
(v) Immediately upon the expiration of a default
period, (x) the right of the holders of Preferred Stock as a
class to elect Directors shall cease, (y) the term of any
Directors elected by the holders of Preferred Stock as a class
shall terminate, and (z) the number of Directors shall be such
number as may be provided for in the Certificate of Incorporation
or By-laws irrespective of any increase made pursuant to the
provisions of paragraph (C)(ii) of this Section 3 (such number
being subject, however, to change thereafter in any manner
provided by law or in the Certificate of Incorporation or By-
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<PAGE> 66
laws). Any vacancies in the Board of Directors effected by the
provisions of clauses (y) and (z) in the preceding sentence may
be filled by a majority of the remaining Directors.
(D) Except as set forth herein, holders of Series A
Junior Participating 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.
Section 4. CERTAIN RESTRICTIONS.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Junior Participating
Preferred Stock as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A
Junior Participating Preferred Stock outstanding shall have been
paid in full, the Corporation shall not:
(i) Declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire for
consideration any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Junior Participating Preferred Stock;
(ii) Declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding up)
with the Series A Junior Participating Preferred Stock except
dividends paid ratably on the Series A Junior Participating
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 on a parity (either
as to dividends or upon liquidation, dissolution or winding up)
with the Series A Junior Participating Preferred Stock provided
that the Corporation may at any time redeem, purchase or
otherwise acquire shares of any such parity stock in exchange for
shares of any stock of the Corporation ranking junior (either as
to dividends or upon dissolution, liquidation or winding up) to
the Series A Junior Participating Preferred Stock; or
(iv) Purchase or otherwise acquire for
consideration any shares of Series A Junior Participating
Preferred Stock or any shares of stock ranking on a parity with
the Series A Junior Participating Junior 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
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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.
Section 5. REACQUIRED SHARES. Any shares of Series A
Junior Participating 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 cancellation become authorized
but unissued shares of Preferred Stock and may be reissued as
part of a new series of Preferred Stock to be created by
resolution or resolutions of the Board of Directors, subject to
the conditions and restrictions on issuance set forth herein.
Section 6. LIQUIDATION, DISSOLUTION OR WINDING UP.
(A) Upon any liquidation (voluntary or otherwise),
dissolution or winding up of the Corporation, no distribution
shall be made to the holders of shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or
winding up) to the Series A Junior Participating Preferred Stock
unless, prior thereto, the holders of shares of Series A Junior
Participating Preferred Stock shall have received per share, the
amount of $18.00, plus an amount equal to accrued and unpaid
dividends and distributions thereon, whether or not declared, to
the date of such payment (the "Series A Liquidation Preference").
Following the payment of the full amount of the Series A
Liquidation Preference, no additional distributions shall be made
to the holders of shares of Series A Junior Participating
Preferred Stock unless, prior thereto, the holders of shares of
Common Stock shall have received an amount per share (the "Common
Adjustment") equal to the quotient obtained by dividing (i) the
Series A Liquidation Preference by (ii) 100 (as appropriately
adjusted as set forth in paragraph (C) below to reflect such
events as stock splits, stock dividends and recapitalizations
with respect to the Common Stock) (such number in clause (ii),
the "Adjustment Number"). Following the payment of the full
amount of the Series A Liquidation Preference and the Common
Adjustment in respect of all outstanding shares of Series A
Junior Participating Preferred Stock and Common Stock,
respectively, holders of Series A Junior Participating Preferred
Stock and holders of shares of Common Stock shall receive their
ratable and proportionate share of the remaining assets to be
distributed in the ratio of the Adjustment Number to 1 with
respect to such Preferred Stock and Common Stock, on a per share
basis, respectively.
(B) In the event there are not sufficient assets
available to permit payment in full of the Series A Liquidation
Preference and the liquidation preferences of all
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other series of Preferred Stock, if any, which rank on a parity
with the Series A Junior Participating Preferred Stock, then such
remaining assets shall be distributed ratably to the holders
of such parity shares in proportion to their respective
liquidation preferences. In the event there are not sufficient
assets available to permit payment in full of the Common Adjustment,
then such remaining assets shall be distributed ratably to the
holders of Common Stock.
(C) In the event the Corporation shall at any time
after the Rights Declaration Date (i) declare any dividend on
Common Stock payable in shares of Common Stock, (ii) subdivide
the outstanding Common Stock, or (iii) combine the outstanding
Common Stock into a smaller number of shares, then in each case
the Adjustment Number in effect immediately prior to such event
shall be adjusted by multiplying such Adjustment Number by a
fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 7. CONSOLIDATION, MERGER, ETC. If the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common
Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such
event the shares of Series A Junior Participating Preferred Stock
shall at the same time be similarly exchanged or changed in an
amount per share (subject to the provision for adjustment
hereinafter set forth) equal to the Adjustment Number times the
aggregate amount of stock, securities, cash and/or any other
property (payable in kind), as the case may be, into which or for
which each share of Common Stock is changed or exchanged.
Section 8. NO REDEMPTION. The shares of Series A
Junior Participating Preferred Stock shall not be redeemable.
Section 9. RANKING. The Series A Junior Participating
Preferred Stock shall rank junior to all other series of the
Corporation's Preferred Stock as to the payment of dividends and
the distribution of assets, unless the terms of any such series
shall provide otherwise.
Section 10. FRACTIONAL SHARES. Series A Junior
Participating Preferred Stock may be issued in fractions of a
share which shall entitle the holder, in proportion to such
holder's fractional shares, to exercise voting rights, receive
dividends, participate in distributions and to have the benefit
of all other rights of holders of Series A Junior Participating
Preferred Stock.
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Section 11. AMENDMENT. The Certificate of
Incorporation of the Corporation shall not be further amended in
any manner which would materially alter or change the powers,
preferences or special rights of the Series A Junior
Participating Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of a majority or more
of the outstanding shares of Series A Junior Participating
Preferred Stock, voting separately as a class.
Section 12. EFFECTIVE DATE. This Amended Certificate
of Designation, Preferences and Rights of Series A Junior
Participating Preferred Stock of Cabot Corporation shall be
effective at 5:00 P.M., Eastern Standard Time, on November 24,
1995.
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IN WITNESS WHEREOF, I have executed and subscribed this
Certificate and do affirm the foregoing as true under penalties
of perjury this 10th day of November, 1995.
By:_________________________
Kennett F. Burnes
President
Attest:
____________________________
Charles D. Gerlinger
Secretary
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