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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
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CROWN CENTRAL PETROLEUM MARYLAND 52-0550682
CORPORATION (State or other I.R.S. Employer
(Exact name of jurisdiction of Identification Number)
registrant as incorporation or
specified in its organization)
charter)
One North Charles Street
Baltimore, Maryland 21201
(410) 539-7400
(Address of principal executive offices) (Zip Code)
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If this form relates to the If this form relates to the
registration of a class of registration of a class of
securities pursuant to securities pursuant to
Section 12(b) of the Section 12(g) of the
of the Exchange Act and is Exchange Act and is
effective pursuant to General effective pursuant to
Instruction A.(c), please check General Instruction A.(d),
the following box. X please check the following
box. ---
Securities Act registration statement file number to which this form
relates: N/A
----
(If applicable)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Each Exchange on which
to be so Registered Class is to be Registered
- -------------------------- -------------------------
Series A Preferred Stock
Purchase Rights American Stock Exchange
Series B Preferred Stock
Purchase Rights American Stock Exchange
Securities to be registered pursuant to Section 12(g) of the Act:
Title to Each Class
- -------------------------------------------------------------
N/A
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ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE
REGISTERED
The following is a summary of the principal terms of the
Rights Agreement (the "Rights Agreement") dated as of February 1,
2000 between Crown Central Petroleum Corporation (the "Company")
and First Union National Bank, as Rights Agent (the "Rights
Agent"), which is qualified in its entirety by reference to the
text of the Rights Agreement. A copy of the Rights Agreement is
attached hereto as Exhibit 4 and is incorporated herein by
reference. A copy of the Rights Agreement is available free of
charge from the secretary of the Company at One North Charles
Street, Baltimore, Maryland 21201.
(a) DECLARATION OF DIVIDEND
On February 1, 2000, the Board of Directors of the Company
declared a dividend of one Series A preferred share purchase right
(a "Series A Right") for each outstanding share of Class A Common
Stock, par value $5.00 per share, of the Company (the "Class A
Common Stock") and one Series B preferred share purchase right (a
"Series B Right" and together with the Series A Rights,
collectively, the "Rights") for each outstanding share of Class B
Common Stock, par value $5.00 per share, of the Company (the
"Class B Common Stock" and together with the Class A Common Stock,
collectively, the "Common Stock"). The dividend is payable on
February 15, 2000 (the "Record Date") to the stockholders of
record on that date.
Under certain circumstances (set forth in Section (b) below),
(i) each Series A Right entitles the registered holder to purchase
from the Company one one-thousandth (1/1000) of a share of Series
A Junior Participating Preferred Stock of the Company, no par
value (the "Series A Preferred Stock") at a price of $16 (subject
to adjustment as provided in the Rights Agreement) per one one-
thousandth (1/1000) of a share of Series A Preferred Stock (the
"Series A Purchase Price") and (ii) each Series B Right entitles
the registered holder to purchase from the Company one one-
thousandth (1/1000) of a share of Series B Junior Participating
Preferred Stock of the Company, no par value (the "Series B
Preferred Stock" and together with the Series A Preferred Stock,
collectively, the "Preferred Stock") at a price of $16 (subject to
adjustment as provided in the Rights Agreement) per one one-
thousandth (1/1000) of a share of Series B Preferred Stock (the
"Series B Purchase Price" and together with the Series A Purchase
Price, collectively, the "Purchase Price").
(b) EXERCISE OF RIGHTS
The Rights may not be exercised until the earlier to occur
of:
(i) 10 days following a public announcement that a person or
group of affiliated or associated persons (an "Acquiring Person")
have acquired (other than through an Approved Transaction as
discussed below), with respect to either class of Common Stock,
beneficial ownership of (1) a number of shares that exceeds 15% of
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the total number of then outstanding shares of such class of
Common Stock (for any person who on the date of the Rights
Agreement beneficially owned a number of shares that is less than
14% of the total number of then outstanding shares of a class of
Common Stock), or (2) the number of shares as disclosed on such
Person's Schedule 13D or 13G, as the case may be, most recently
filed with the Securities and Exchange Commission prior to the
date of the Rights Agreement, plus an additional number of shares
of such class of Common Stock that exceeds 1% of the total number
of shares of such class of Common Stock outstanding as of the date
of the Rights Agreement (for any person who on the date of the
Rights Agreement beneficially owned a number of shares that is
equal to or exceeds 14% of the total number of outstanding shares
of either class of Common Stock) (either (1) or (2) above is
hereinafter referred to as a "Substantial Block" of Common Stock);
or
(ii) 10 business days (or such later date as may be
determined by action of the Board of Directors of the Company
prior to such time as any person or group of affiliated persons
becomes an Acquiring Person) following the commencement of, or
announcement of an intention to make, a tender offer (other than a
tender offer which is an Approved Transaction) or exchange offer
the consummation of which may result in the beneficial ownership
by a person or group of a Substantial Block (the earlier of such
dates described in clauses (i) and (ii) being referred to as the
"Distribution Date").
Under the Rights Agreement, an Approved Transaction means
either (i) a tender offer to all of the holders of each class of
Common Stock (A) which provides for the acquisition by the tender
offeror of all of the issued and outstanding shares of both Class
A Common and Class B Common (other than shares of Common Stock
held by an Acquiring Person or its Associates or Affiliates)
solely for cash; (B) following which tender offer the tender
offeror exercises reasonable best efforts to consummate a
statutory merger within 90 days of the date of the tender offer
pursuant to which the shares of Common Stock not tendered pursuant
to the tender offer are exchanged for cash on terms no less
favorable to the holders of such Common Stock as was offered in
the tender offer; and (C) which a majority of the Board of
Directors of the Company, prior to the date on which such tender
offer was commenced, shall have approved and, after receiving
advice from one or more investment banking firms, determined to be
fair to the holders of Common Stock from a financial point of
view, taking into account all factors which such Directors deem
relevant including, without limitation, values indicated in light
of long-term prospects or business plans or aggregate prices or
values which could reasonably be achieved if part or all of the
Company or its assets were sold or restructured on an orderly
basis designed to realize maximum long-term value; or (ii) a
statutory merger (A) in which all shares of Common Stock are
exchanged for cash, and (B) which a majority of the Board of
Directors of the Company, prior to the date on which the merger
was agreed upon, shall have approved and, after receiving advice
from one or more investment banking firms, determined to be fair
to the holders of the Common Stock from a financial point of view,
taking into account all factors which such Directors deem relevant
including, without limitation, values indicated in light of long-
term prospects or business plans or aggregate prices or values
which could reasonably be achieved if part or all of the Company
or its assets were sold or restructured on an orderly basis
designed to realize maximum long-term value. No one can become an
Acquiring Person solely as a result of acquiring securities
pursuant to and in accordance with an Approved Transaction.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, including, without
limitation, the right to vote or to receive dividends. The Rights
will expire on February 14, 2001 (the "Final Expiration Date"),
unless the Company exchanges the Rights as described in Section
(g) below.
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(c) CERTIFICATION OF RIGHTS
Until the Distribution Date, the Rights will be evidenced,
with respect to any of the Common Stock outstanding as of the
Record Date, by certificates evidencing shares of such Common
Stock having a copy of a summary of rights in the form attached to
the Rights Agreement as EXHIBIT B (the "Summary of Rights")
attached thereto. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights
("Right Certificates") will be mailed to holders of record of the
Company's Common Stock as of the close of business on the
Distribution Date and such separate Right Certificates alone will
evidence the Rights associated with such Common Stock.
(d) TRANSFER OF RIGHTS
Until the Distribution Date (or earlier redemption or
expiration of the Rights):
(i) the Rights will be transferred with and only with the
Common Stock;
(ii) upon transfer or new issuance of Common Stock, new
certificates for shares of Common Stock issued after the Record
Date will contain a notation incorporating the Rights Agreement by
reference; and
(iii) the transfer of any Common Stock outstanding as of the
Record Date, including surrender for transfer of any certificates
therefor 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 such Common Stock.
(e) ANTI-DILUTION AND OTHER INVESTOR PROTECTIONS
The Purchase Price payable, and the number of shares of
Preferred Stock or other securities or property issuable, upon
exercise of the Rights are subject to adjustment from time to time
to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred
Stock, (ii) upon the grant to holders of the Preferred Stock of
certain rights or warrants to subscribe for or purchase shares of
Preferred Stock at a price, or securities convertible into
Preferred Stock with a conversion price, less than the
then-current market price of the Preferred Stock, or (iii) upon
the distribution to holders of the Preferred Stock of evidences of
indebtedness or assets (excluding regular periodic cash dividends
paid out of earnings or retained earnings or dividends payable in
shares of Preferred Stock) or of subscription rights or warrants
(other than those referred to above). With certain exceptions, no
adjustment in the Purchase Price will be required until cumulative
adjustments require an adjustment of at least 1% in such Purchase
Price.
The number of outstanding Rights and the number of one
one-thousandths (1/1000) of a share of Preferred Stock issuable
upon exercise of each Right are also subject to adjustment in the
event of a stock split of the Common Stock or a stock dividend on
the Common Stock payable in shares of Common Stock or
subdivisions, consolidations or combinations of the Common Stock
occurring, in any such case, prior to the Distribution Date.
In the event that the Company is acquired in a merger or
other business combination transaction other than an Approved
Transaction or 50% or more of its consolidated assets or earning
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power are sold after a person or group has become an Acquiring
Person, proper provisions will be made so that each holder of a
Right will thereafter have the right to receive, upon the exercise
thereof at the then current exercise price of the Right, that
number of shares of common stock of the acquiring company which at
the time of such transaction will have a market value of two times
the exercise price of the Right. In the event that any person or
group of affiliated or associated persons becomes an Acquiring
Person, proper provision shall be made so that each holder of a
Right, other than Rights beneficially owned by the Acquiring
Person (which will thereafter be void), will thereafter have the
right to receive upon exercise that number of shares of Common
Stock having a market value of two times the exercise price of the
Right.
The Company shall not be required to issue fractions of
shares of Preferred Stock (other than fractions which are integral
multiples of one one-thousandth (1/1000) of a share of Preferred
Stock) upon exercise of the Rights or to distribute certificates
which evidence fractional shares of Preferred Stock (other than
fractions which are integral multiples of one one-thousandth
(1/1000) of a share of Preferred Stock). Fractions of shares of
Preferred Stock in integral multiples of one one-thousandth
(1/1000) of a share of Preferred Stock may, at the election of the
Company, be evidenced by depositary receipts, pursuant to an
appropriate agreement between the Company and a depositary
selected by it; provided that such agreement shall provide that
the holders of such depositary receipts shall have all the rights,
privileges and preferences to which they are entitled as
beneficial owners of the shares of Preferred Stock represented by
such depositary receipts.
In lieu of fractional shares of Preferred Stock that are not
integral multiples of one one-thousandth (1/1000) of a share of
Preferred Stock, the Company may, at its option, either (i) pay to
any registered holder of a Right Certificate at the time such
Rights are exercised as herein provided an amount in cash equal to
the same fraction of the current market value of one share of
Preferred Stock, or (ii) round up any fractional share of
Preferred Stock to the next highest integral multiple of one one-
thousandth (1/1000) of a share of Preferred Stock and issue such
next highest integral multiple of one one-thousandth (1/1000) of a
share of Preferred Stock.
(f) RIGHTS AND PREFERENCES OF THE UNDERLYING PREFERRED
STOCK
Preferred Stock purchasable upon exercise of the Rights will
be nonredeemable. Each share of Preferred Stock will have a
minimum preferential quarterly dividend in an amount per share
equal to the greater of (i) $1.00, or (ii) subject to certain
adjustments, 1000 times the aggregate per share amount of all cash
dividends, and 1000 times the aggregate per share amount (payable
in kind) of all non-cash dividends or other distributions other
than a dividend payable in corresponding Common Stock or a
subdivision of the outstanding Common Stock (by reclassification
or otherwise), declared on the corresponding Common Stock, since
the date of the immediately preceding quarterly dividend payment
or, with respect to the date of the first quarterly dividend
payment, since the first issuance of any share or fraction of a
share of Preferred Stock. In the event of liquidation, the
holders of shares of Preferred Stock will receive a preferential
liquidation payment equal to the greater of $1.00 per share, plus
accrued and unpaid dividends and distributions thereon, or 1000
times the payment made per share of corresponding Common Stock.
Each share of Series A Preferred Stock will have 1000 votes
and each share of Series B Preferred Stock will have 100 votes,
voting together with the Common Stock on all matters on which
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the shares of Class A Common and the shares of Class B Common vote
together and, to the extent entitled to vote for the election or
removal of Directors, separately by class for the election or
removal of Directors. If, on any record date for determining
stockholders entitled to vote for the election or removal of
Directors, a certain threshold number of shares of Series A
Preferred Stock is then issued and outstanding (as such threshold
is determined pursuant to the Articles Supplementary attached as
EXHIBIT 3(i) hereto), the holders of Series A Preferred Stock will
then have the ability to elect and remove one more Director than
the number of Directors the Class A Common Stock is then entitled
to elect and remove. If, on any record date for determining
stockholders entitled to vote for the election or removal of
Directors, a certain threshold number of shares of Series B
Preferred Stock is then issued and outstanding (as such threshold
is determined pursuant to the Articles Supplementary attached as
EXHIBIT 3(i) hereto), the holders of Series B Preferred Stock will
then be entitled to elect two Directors.
In the event of any merger, consolidation or other
transaction in which shares of Common Stock are exchanged, each
share of Preferred Stock will be entitled to receive 1000 times
the amount received per share of corresponding Common Stock.
These rights are protected by customary antidilution provisions.
Because of the nature of the dividend, liquidation and voting
rights of the Preferred Stock, the value of one one-thousandth
(1/1000) interest in a share of Series A Preferred Stock
purchasable upon exercise of each Series A Right should
approximate the value of one share of Class A Common Stock and the
value of one one-thousandth (1/1000) interest in a share of Series
B Preferred Stock purchasable upon exercise of each Series B Right
should approximate the value of one share of Class B Common Stock.
(g) BOARD'S ABILITY TO EXCHANGE THE RIGHTS
At any time after any person or group becomes an Acquiring
Person and prior to the acquisition by such person or group of 50%
or more of the outstanding shares of Common Stock, the Board of
Directors of the Company may exchange the Rights (other than
Rights owned by such person or group which will have become void),
in whole or in part, at an exchange ratio of one share of Common
Stock, or one one-thousandth (1/1000) of a share of Preferred
Stock (or of a share of a class or series of the Company's
Preferred Stock having equivalent rights, preferences and
privileges), per Right, subject to adjustment.
(h) BOARD'S ABILITY TO REDEEM THE RIGHTS
At any time prior to the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of a
Substantial Block of either class of Common Stock, the Board of
Directors of the Company may redeem the Rights in whole, but not
in part, at a price of $.001 per Right or, at the option of the
Board of Directors, for one one-thousandth (1/1000) of a share of
Class A Common Stock per Series A Right and one one-thousandth
(1/1000) of a share of Class B Common Stock per Series B Right
(either, the "Redemption Price"). The redemption of the Rights
may be made effective at such time on such basis with such
conditions as the Board of Directors in its sole discretion may
establish. Immediately upon any redemption of the Rights, the
right to exercise the Rights will terminate and the only right of
the holders of the Rights will be to receive the Redemption Price.
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(i) AMENDMENT
The terms of the Rights may be amended in certain respects by
the Board of Directors of the Company without the consent of the
holders of the Rights, except that from and after such time as any
person or group of affiliated or associated persons becomes an
Acquiring Person no such amendment may adversely affect the
interests of the holders of the Rights.
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ITEM 2. EXHIBITS
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Exhibit No. Description
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3(i) Articles Supplementary setting forth the
designation, preferences and rights of the
Series A Junior Participating Preferred Stock
and the Series B Junior Participating Preferred
Stock of Crown Central Petroleum Corporation
dated February 1, 2000.
4 Rights Agreement dated as of February 1, 2000
between the Company and First Union National
Bank, as Rights Agent.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused
this Registration Statement to be signed on its behalf by the
undersigned, thereto duly authorized.
CROWN CENTRAL PETROLEUM CORPORATION
By:/s/ John E. Wheeler, Jr.
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Name: John E. Wheeler, Jr.
Title: Executive Vice President--Chief
Financial Officer
Date: February 1, 2000
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EXHIBIT INDEX
Exhibit No. Description
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3(i) Articles Supplementary setting forth the
designation, preferences and rights of the
Series A Junior Participating Preferred Stock
and the Series B Junior Participating Preferred
Stock of Crown Central Petroleum Corporation
dated February 1, 2000.
4 Rights Agreement dated as of February 1, 2000
between the Company and First Union National
Bank, as Rights Agent.
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EXHIBIT 3(i)
ARTICLES SUPPLEMENTARY
Crown Central Petroleum Corporation, a Maryland corporation
having its principal office in Baltimore, Maryland (hereinafter
referred to as the "Corporation"), hereby certifies to the State
Department of Assessments and Taxation of Maryland, that:
FIRST: Pursuant to the authority vested in the Board of
Directors of the Corporation by Sections 5.1 and 5.2 of the
Amended and Restated Articles of Incorporation of the Corporation,
the Board of Directors has duly authorized and created two series
of preferred shares of the Corporation, designated as "Series A
Junior Participating Preferred Stock" and "Series B Junior
Participating Preferred Stock" (the Series A Junior Participating
Preferred Stock and the Series B Junior Participating Preferred
Stock are collectively referred to herein as the "Preferred
Stock"), respectively.
SECOND: A description of such Preferred Stock, including the
respective preferences, conversion and other rights, voting
powers, restrictions, limitations as to dividends, qualifications,
and terms and conditions for redemption, all as set by the Board
of Directors of the Corporation, and as set forth in the new
Section 5.4 and Section 5.5 of the Corporation's Amended and
Restated Articles of Incorporation, is as follows:
Section 5.4. Series A Junior Participating Preferred Stock.
(a) Designation and Amount. Pursuant to a resolution
adopted by the Board of Directors of the Corporation on February
1, 2000, 4,818 preferred shares (of no par value) are hereby
constituted as a series of preferred shares of the Corporation
which shall be designated as "Series A Junior Participating
Preferred Stock" (the "Series A Preferred Stock"), the preferences
and relative, optional and other special rights of which and the
qualifications, limitations or restrictions of which shall be as
set forth herein.
(b) Dividends and Distribution. Subject to the prior and
superior rights of the holders of any preferred shares of any
series ranking prior and superior to the Series A Preferred Stock
with respect to dividends, the holders of Series A Preferred
Stock, in preference to the holders of Class A Common Stock and
Class B Common Stock of the Corporation, shall be entitled to
receive, together and on parity with the Series B Preferred Stock
described in Section 5.5 below, 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 fifteenth day of
January, April, July and October in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"),
commencing on the first Quarterly Dividend Payment Date after the
first issuance of a share or fraction of a share of Series A
Preferred Stock, in an amount per share (rounded to the nearest
cent) equal to the greater of (i) $1.00 or (ii) subject to the
provision for adjustment hereinafter set forth, 1000 times the
aggregate per share amount of all cash dividends, and 1000 times
the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions other than a dividend payable in
Common Stock or a subdivision of the outstanding Common Stock (by
reclassification or otherwise), declared on the Common Stock,
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since the immediately preceding Quarterly Dividend Payment Date
or, with respect to the first Quarterly Dividend Payment Date,
since the first issuance of any share or fraction of a share of
Series A Preferred Stock. In the event the Corporation shall at
any time declare or pay any dividend on Common Stock payable in
Common Stock, or effect a subdivision or combination or
consolidation of the outstanding Common Stock (by reclassification
or otherwise than by payment of a dividend in Common Stock) into a
greater or lesser number of shares of Common Stock, then in each
such case the amount to which holders of Series A Preferred Stock
were entitled immediately prior to such event under clause (ii) 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.
The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in this paragraph
immediately after it declares a dividend or distribution on the
Class A Common Stock (other than a dividend payable in Common
Stock); provided that, in the event no dividend or distribution
shall have been declared on the Class A Common Stock during the
period between any Quarterly Dividend Payment Date and the next
subsequent Quarterly Dividend Payment Date, a dividend of $1.00
per share on the Series A Preferred Stock shall nevertheless be
payable on such subsequent Quarterly Dividend Payment Date.
Dividends shall begin to accrue and be cumulative on
outstanding Series A Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such Series A
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 Series A 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 Series A Preferred Stock in
an amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on
a share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for the
determination of holders of Series A 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.
(c) Voting Rights. The holders of Series A Preferred Stock
shall have the following voting rights:
(1) In all proceedings in which action of the
stockholders shall be taken, subject to the provision for
adjustment hereinafter set forth, each share of Series A Preferred
Stock shall entitle the holder thereof to 1000 votes on
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all matters submitted to a vote of the shareholders of the
Corporation. In the event the Corporation shall at any time
declare or pay any dividend on Common Stock payable in Common
Stock, or effect a subdivision or combination or consolidation of
the outstanding Common Stock (by reclassification or otherwise
than by payment of a dividend in Common Stock) into a greater or
lesser number of Common Stock, then in each such case the number
of votes per share to which holders of Series A Preferred Stock
were entitled immediately prior to such event shall be adjusted by
multiplying such number by a fraction the numerator of which is
the number of Common Stock outstanding immediately after such
event and the denominator of which is the number of Common Stock
that were outstanding immediately prior to such event.
(2) Except as otherwise provided herein or by law, the
holders of Series A Preferred Stock, and the holders of Common
Stock and all other series or classes of stock (including, without
limitation, the Series B Preferred) shall vote together as one
class on all matters submitted to a vote of shareholders of the
Corporation.
(3) The foregoing clauses (c)(1) and (c)(2) notwithstanding,
the holders of Series A Preferred Stock shall be not be entitled
to vote for the election or removal of directors unless, on the
record date set for determining the stockholders entitled to vote
on such matter or matters, there is then issued and outstanding an
amount of Series A Preferred Stock which is in excess of 25% of
the Series A Preferred Stock issuable to the holders of Class A
Common Stock (other than to an Acquiring Person within the meaning
of the Shareholder Rights Plan adopted by the Board of Directors
on February 1, 2000 (the "Rights Plan")) in the event all holders
of Class A Common Stock (other than any Acquiring Person within
the meaning of the Rights Plan) were to subscribe to all of the
Series A Preferred Stock issuable to the holders of Class A Common
Stock upon exercise of all Rights issued to holders of Class A
Common Stock pursuant to the Rights Plan. In the event the
holders of Series A Preferred Stock become entitled to vote in any
election or removal of directors in accordance with the previous
sentence, they shall be entitled, voting separately as a class, to
elect and to remove that number of directors of the Corporation as
is equal to (i) the total number of directors of the Corporation,
less the number of directors which the holders of Class B Common
Stock or any other class or classes or series of stock, other than
the Class A Common Stock, have the right to elect, divided by (ii)
two; PROVIDED, HOWEVER, that the number derived by dividing clause
(i) by clause (ii) above shall be adjusted by (X) rounding such
number up to the nearest whole number if such number is not a
whole number, or (Y) in the event such number is a whole number,
adding one (1) to such number.
(4) Except as set forth herein, holders of Series A
Preferred Stock shall have no special or class voting rights.
(d) Certain Restrictions.
(1) Whenever quarterly dividends or other dividends or
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distributions payable on the Series A Preferred Stock as provided
in paragraph (b) are in arrears, thereafter and until all accrued
and unpaid dividends and distributions, whether or not declared,
on Series A 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 the Corporation ranking junior to
(either as to dividends or upon liquidation, dissolution or
winding up) the Series A Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of the Corporation ranking on a parity
(either as to dividends or upon liquidation, dissolution or
winding up) with the Series A Preferred Stock, except dividends
paid ratably on the Series A Preferred Stock and all such parity
shares 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 any shares of the Corporation ranking on a parity
(either as to dividends or upon liquidation, dissolution or
winding up) with the Series A Preferred Stock, provided that the
Corporation may at any time redeem, purchase or otherwise acquire
any such parity shares in exchange for any shares of the
Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A Preferred
Stock; or
(iv) purchase or otherwise acquire for
consideration any Series A Preferred Stock, or any shares of the
Corporation ranking on a parity with the Series A Preferred Stock,
except in accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend rates and
other relative rights and preferences of the respective series and
classes shall determine in good faith will result in fair and
equitable treatment among the respective series or classes.
(2) The Corporation shall not permit any subsidiary of
the Corporation to purchase or otherwise acquire for consideration
any shares of the Corporation unless the Corporation could, under
subparagraph (1) of this paragraph (d), purchase or otherwise
acquire such shares at such time and in such manner.
(e) Reacquired Shares. Any Series A Preferred Stock
purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and canceled promptly after the
acquisition thereof. All such shares shall upon their
cancellation, and upon the taking of any action required by
applicable law, become authorized but unissued preferred shares
<PAGE>
and may be reissued as part of a new series of preferred shares to
be created by resolution or resolutions of the Board of Directors,
subject to the conditions and restrictions on issuance set forth
herein.
(f) Liquidation, Dissolution or Winding Up. Upon any
voluntary liquidation, dissolution or winding up of the
Corporation, no distribution shall be made:
(1) to the holders of shares of the Corporation ranking
junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series A Preferred Stock unless, prior thereto,
the holders of Series A Preferred Stock shall have received $1.00
per share, plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of
such payment, provided that the holders of Series A Preferred
Stock shall be entitled to receive an aggregate amount per share,
subject to the provision for adjustment hereinafter set forth,
equal to 1000 times the aggregate amount to be distributed per
share to holders of Common Stock, or
(2) to the holders of shares of the Corporation ranking
on a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Preferred Stock,
except distributions made ratably on the Series A Preferred Stock
and all other such parity shares in proportion to the total
amounts to which the holders of all such shares are entitled upon
such liquidation, dissolution or winding up.
(g) Consolidation Merger, etc. In case the Corporation
shall enter into any consolidation, merger, combination or other
transaction in which the shares of Common Stock are exchanged for
or changed into other shares or securities, cash and/or any other
property, then in any such case the Series A 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 1000 times the aggregate amount of shares,
securities, cash and/or any other property (payable in kind), as
the case may be, into which or for which each share of Common
Stock is changed or exchanged. In the event the Corporation shall
at any time declare or pay any dividend on Common Stock payable in
Common Stock, or effect a subdivision or combination or
consolidation of the outstanding Common Stock (by reclassification
or otherwise than by payment of a dividend in Common Stock) into a
greater or lesser number of shares of Common Stock, then each such
case the amount set forth in the preceding sentence with respect
to the exchange or change of Series A Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately
prior to such event.
(h) No Redemption. The Series A Preferred Stock shall not
be redeemable.
(i) Ranking. The Series A Preferred Stock shall be
<PAGE>
junior to all other series of the Corporation's preferred shares
as to the payment of dividends and the distribution of assets,
except for the Series B Preferred Stock, which shall be and hereby
is made pari passu with the Series A Preferred Stock, and except
to the extent any other series is hereafter made pari passu with
the Series A Preferred Stock.
(j) Amendment. The Certificate of Incorporation of the
Corporation shall not be amended in any manner which would
materially alter or change the powers, preferences or special
rights of the Series A Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of two-
thirds or more of the outstanding Series A Preferred Stock voting
together as a single class.
Section 5.5. Series B Junior Participating Preferred Stock.
(a) Designation and Amount. Pursuant to a resolution
adopted by the Board of Directors of the Corporation on February
1, 2000, 5,254 preferred shares (of no par value) are hereby
constituted as a series of preferred shares of the Corporation
which shall be designated as "Series B Junior Participating
Preferred Stock" (the "Series B Preferred Stock"), the preferences
and relative, optional and other special rights of which and the
qualifications, limitations or restrictions of which shall be as
set forth herein.
(b) Dividends and Distribution. Subject to the prior and
superior rights of the holders of any preferred shares of any
series ranking prior and superior to the Series B Preferred Stock
with respect to dividends, the holders of Series B Preferred
Stock, in preference to the holders of Class A Common Stock and
Class B Common Stock of the Corporation, shall be entitled to
receive, together and on parity with the Series A Preferred Stock
described in Section 5.4 above, 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 fifteenth day of
January, April, July and October in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"),
commencing on the first Quarterly Dividend Payment Date after the
first issuance of a share or fraction of a share of Series B
Preferred Stock, in an amount per share (rounded to the nearest
cent) equal to the greater of (i) $1.00 or (ii) subject to the
provision for adjustment hereinafter set forth, 1000 times the
aggregate per share amount of all cash dividends, and 1000 times
the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions other than a dividend payable in
Common Stock or a subdivision of the outstanding 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 B Preferred Stock. In the event the Corporation shall at
any time declare or pay any dividend on Common Stock payable in
Common Stock, or effect a subdivision or combination or
consolidation of the outstanding Common Stock (by reclassification
or otherwise than by payment of a dividend in Common Stock) into a
greater or lesser number of shares of Common Stock, then in each
such case the amount to which holders of Series B Preferred Stock
were entitled immediately prior to such event under clause (ii) of
the preceding sentence shall be adjusted by multiplying such
amount by a fraction the numerator
<PAGE>
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.
The Corporation shall declare a dividend or distribution
on the Series B Preferred Stock as provided in this paragraph
immediately after it declares a dividend or distribution on the
Class B Common Stock (other than a dividend payable in Common
Stock); provided that, in the event no dividend or distribution
shall have been declared on the Class B Common Stock during the
period between any Quarterly Dividend Payment Date and the next
subsequent Quarterly Dividend Payment Date, a dividend of $1.00
per share on the Series B Preferred Stock shall nevertheless be
payable on such subsequent Quarterly Dividend Payment Date.
Dividends shall begin to accrue and be cumulative on
outstanding Series B Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such Series B
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 Series B 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 Series B Preferred Stock in
an amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on
a share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for the
determination of holders of Series B 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.
(c) Voting Rights. The holders of Series B Preferred Stock
shall have the following voting rights:
(1) In all proceedings in which action of the
stockholders shall be taken, subject to the provision for
adjustment hereinafter set forth, each share of Series B Preferred
Stock shall entitle the holder thereof to 100 votes on all matters
submitted to a vote of the shareholders of the Corporation. In
the event the Corporation shall at any time declare or pay any
dividend on Common Stock payable in Common Stock, or effect a
subdivision or combination or consolidation of the outstanding
Common Stock (by reclassification or otherwise than by payment of
a dividend in Common Stock) into a greater or lesser number of
Common Stock, then in each such case the number of votes per share
to which holders of Series B Preferred Stock were entitled
immediately prior to such event shall be adjusted by multiplying
such number by a fraction the numerator of which is the number of
Common Stock outstanding immediately after such event and the
denominator of which is the number of Common Stock
<PAGE>
that were outstanding immediately prior to such event.
(2) Except as otherwise provided herein or by law, the
holders of Series B Preferred Stock, and the holders of Common
Stock and all other series or classes of stock (including, without
limitation, the Series A Preferred Stock) shall vote together as
one class on all matters submitted to a vote of shareholders of
the Corporation.
(3) The foregoing clauses (c)(1) and (c)(2)
notwithstanding, the holders of Series B Preferred Stock shall be
not be entitled to vote for the election or removal of directors
unless, on the record date set for determining the stockholders
entitled to vote on such matter or matters, there is then issued
and outstanding an amount of Series B Preferred Stock which is in
excess of 25% of the Series B Preferred Stock issuable to the
holders of Class B Common Stock (other than to an Acquiring Person
within the meaning of the Rights Plan) in the event all holders of
Class B Common (other than any Acquiring Person within the meaning
of the Rights Plan) were to subscribe to all of the Series B
Preferred Stock issuable to the holders of Class B Common Stock
upon exercise of all Rights issued to holders of Class B Common
Stock pursuant to the Rights Plan. In the event the holders of
Series B Preferred Stock become entitled to vote in any election
or removal of directors in accordance with the previous sentence,
they shall be entitled, voting separately as a class, to elect and
to remove two directors of the Corporation.
(4) Except as set forth herein, holders of Series B
Preferred Stock shall have no special or class voting rights.
(d) Certain Restrictions.
(1) Whenever quarterly dividends or other dividends or
distributions payable on the Series B Preferred Stock as provided
in paragraph (b) are in arrears, thereafter and until all accrued
and unpaid dividends and distributions, whether or not declared,
on Series B 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 the Corporation ranking junior to
(either as to dividends or upon liquidation, dissolution or
winding up) the Series B Preferred Stock;
(ii) declare or pay dividends on or make any
other distributions on any shares of the Corporation ranking on a
parity (either as to dividends or upon liquidation, dissolution or
winding up) with the Series A Preferred Stock, except dividends
paid ratably on the Series B Preferred Stock and all such parity
shares 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;
<PAGE>
(iii) redeem or purchase or otherwise acquire
for consideration any shares of the Corporation ranking on a
parity (either as to dividends or upon liquidation, dissolution or
winding up) with the Series B Preferred Stock, provided that the
Corporation may at any time redeem, purchase or otherwise acquire
any such parity shares in exchange for any shares of the
Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series B Preferred
Stock; or
(iv) purchase or otherwise acquire for
consideration any Series B Preferred Stock, or any shares of the
Corporation ranking on a parity with the Series B Preferred Stock,
except in accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend rates and
other relative rights and preferences of the respective series and
classes shall determine in good faith will result in fair and
equitable treatment among the respective series or classes.
(2) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any
shares of the Corporation unless the Corporation could, under
subparagraph (1) of this paragraph (d), purchase or otherwise
acquire such shares at such time and in such manner.
(e) Reacquired Shares. Any Series B Preferred Stock
purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and canceled promptly after the
acquisition thereof. All such shares shall upon their
cancellation, and upon the taking of any action required by
applicable law, become authorized but unissued preferred shares
and may be reissued as part of a new series of preferred shares to
be created by resolution or resolutions of the Board of Directors,
subject to the conditions and restrictions on issuance set forth
herein.
(f) Liquidation, Dissolution or Winding Up. Upon any
voluntary liquidation, dissolution or winding up of the
Corporation, no distribution shall be made:
(1) to the holders of shares of the Corporation ranking
junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series B Preferred Stock unless, prior thereto,
the holders of Series B Preferred Stock shall have received $1.00
per share, plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of
such payment, provided that the holders of Series B Preferred
Stock shall be entitled to receive an aggregate amount per share,
subject to the provision for adjustment hereinafter set forth,
equal to 1000 times the aggregate amount to be distributed per
share to holders of Common Stock, or
(2) to the holders of shares of the Corporation
<PAGE>
ranking on a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series B Preferred Stock,
except distributions made ratably on the Series B Preferred Stock
and all other such parity shares in proportion to the total
amounts to which the holders of all such shares are entitled upon
such liquidation, dissolution or winding up.
(g) Consolidation Merger, etc. In case the Corporation
shall enter into any consolidation, merger, combination or other
transaction in which the shares of Common Stock are exchanged for
or changed into other shares or securities, cash and/or any other
property, then in any such case the Series B 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 1000 times the aggregate amount of shares,
securities, cash and/or any other property (payable in kind), as
the case may be, into which or for which each share of Common
Stock is changed or exchanged. In the event the Corporation shall
at any time declare or pay any dividend on Common Stock payable in
Common Stock, or effect a subdivision or combination or
consolidation of the outstanding Common Stock (by reclassification
or otherwise than by payment of a dividend in Common Stock) into a
greater or lesser number of shares of Common Stock, then each such
case the amount set forth in the preceding sentence with respect
to the exchange or change of Series B Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately
prior to such event.
(h) No Redemption. The Series B Preferred Stock shall not
be redeemable.
(i) Ranking. The Series B Preferred Stock shall be junior
to all other series of the Corporation's preferred shares as to
the payment of dividends and the distribution of assets, except
for the Series A Preferred Stock, which shall be and hereby is
made pari passu with the Series B Preferred Stock, and except to
the extent any other series is hereafter made pari passu with the
Series B Preferred Stock.
(j) Amendment. The Certificate of Incorporation of the
Corporation shall not be amended in any manner which would
materially alter or change the powers, preferences or special
rights of the Series B Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of two-
thirds or more of the outstanding Series B Preferred Stock voting
together as a single class.
<PAGE>
IN WITNESS WHEREOF, Crown Central Petroleum Corporation has
caused these Articles Supplementary to be signed and acknowledged
in its name and on its behalf by its Executive Vice President and
its corporate seal to be hereunto affixed and attested by its
Secretary on the 1st day of February, 2000.
ATTEST: CROWN CENTRAL PETROLEUM
CORPORATION
/s/Dolores B. Rawlings /s/John E. Wheeler, Jr.
- ------------------- By-----------------------
Dolores B. Rawlings John E. Wheeler, Jr.
Secretary Executive Vice President
THE UNDERSIGNED, Executive Vice President of Crown Central
Petroleum Corporation, who executed on behalf of said Corporation
the foregoing Articles Supplementary to the Charter, of which this
certificate is made a part, hereby acknowledges, in the name and
on behalf of said Corporation, the foregoing Articles
Supplementary to the Charter to be the corporate act of said
Corporation, and further certifies that, to the best of his
knowledge, information and belief, the matters and facts set forth
therein with respect to the approval thereof are true in all
material respects under the penalties of perjury.
/s/John E. Wheeler, Jr.
Dated: February 1, 2000 ------------------------
John E. Wheeler, Jr.
Executive Vice President
<PAGE>
EXHIBIT 4
CROWN CENTRAL PETROLEUM CORPORATION
AND
FIRST UNION NATIONAL BANK,
RIGHTS AGENT
RIGHTS AGREEMENT
DATED AS OF FEBRUARY 1, 2000
<PAGE>
Table of Contents
Section Page
Section 1. Certain Definitions............................1
Section 2. Appointment of Rights Agent....................6
Section 3. Issues of Right Certificates...................6
Section 4. Form of Right Certificates.....................8
Section 5. Countersignature and Registration..............8
Section 6. Transfer, Split Up, Combination and Exchange
of Right Certificates; Mutilated, Destroyed,
Lost or Stolen Right Certificates............8
Section 7. Exercise of Rights; Purchase Price; Expiration
Date of Rights...............................9
Section 8. Cancellation and Destruction of Right
Certificates................................10
Section 9. Availability of Preferred Stock...............10
Section 10. Preferred Stock Record Date...................11
Section 11. Adjustment of Purchase Price, Number of
Shares or Number of Rights.................11
Section 12. Certificate of Adjusted Purchase Price or
Number of Shares...........................17
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power....................17
Section 14. Fractional Rights and Fractional Shares.......18
Section 15. Rights of Action..............................19
Section 16. Agreement of Right Holders....................20
Section 17. Right Holder Not Deemed a Stockholder.........20
Section 18. Concerning the Rights Agent...................20
Section 19. Merger or Consolidation or Change of Name
of Rights Agent............................21
Section 20. Duties of Rights Agent........................21
Section 21. Change of Rights Agent........................23
Section 22. Issuance of New Right Certificates............24
Section 23. Redemption....................................24
Section 24. Exchange......................................25
Section 25. Notice of Certain Events......................26
Section 26. Notices.......................................27
Section 27. Supplements and Amendments....................28
Section 28. Successors....................................28
Section 29. Benefits of this Agreement....................28
Section 30. Severability..................................28
Section 31. Governing Law.................................28
Section 32. Counterparts..................................28
Section 33. Descriptive Headings..........................29
EXHIBITS
Exhibit A-1 - Form of Series A Right Certificate
Exhibit A-2 - Form of Series B Right Certificate
Exhibit B - Summary of Rights to Purchase Preferred Stock
<PAGE>
RIGHTS AGREEMENT
THIS RIGHTS AGREEMENT (this "Agreement") dated as of February
1, 2000, is entered into between Crown Central Petroleum
Corporation, a Maryland corporation (the "Company"), and First
Union National Bank, a national banking association, as rights
agent (the "Rights Agent").
The Board of Directors of the Company has authorized and
declared a dividend with respect to shares of Common Stock of the
Company outstanding on February 15, 2000 (the "Record Date") of
one Series A Preferred share purchase right (a "Series A Right")
for each share of Class A Common and one Series B Preferred share
purchase right (a "Series B Right") for each share of Class B
Common. Each Series A Right represents the right to purchase one
one-thousandth of a share of Series A Preferred and each Series B
Right represents the right to purchase one one-thousandth of a
share of Series B Preferred, upon the terms and subject to the
conditions herein set forth. The Board of Directors of the
Company has further authorized and directed the issuance of one
Series A Right with respect to each share of Class A Common and
one Series B Right with respect to each share of Class B Common
that shall become outstanding between the Record Date and the
earliest of the Distribution Date, the Redemption Date and the
Final Expiration Date.
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 a Substantial Block of either
Class of Common Stock, but shall not include the Company, any
Subsidiary of the Company, any employee benefit plan of the
Company or any Subsidiary of the Company, or any entity holding
Common Stock for or pursuant to the terms of any such plan.
Notwithstanding the foregoing, no Person shall become an
"Acquiring Person" solely:
(i) as the result of an acquisition of Common
Stock by the Company which, by reducing the total number of Common
Stock of either Class outstanding causes such Person to become the
Beneficial Owner of a Substantial Block; provided, however, that
if a Person shall become the Beneficial Owner of a Substantial
Block of either Class of Common Stock solely as the result of an
acquisition of Common Stock by the Company and shall, after such
stock purchases by the Company, become the Beneficial Owner of any
additional Common Stock of either Class, then such Person shall be
deemed to be an "Acquiring Person";
(ii) as a result of shares of Common Stock
acquired pursuant to and in accordance with an Approved
Transaction.
<PAGE>
Notwithstanding the foregoing, if the Board of Directors
of the Company determines in good faith that a Person who would
otherwise be an "Acquiring Person," as defined pursuant to the
foregoing provisions of this paragraph (a), has become such
inadvertently, and such Person divests as promptly as practicable
a sufficient number of shares of Common Stock of the Class with
respect to which that Person has a Substantial Block so that such
Person would no longer be an "Acquiring Person," as defined
pursuant to the foregoing provisions of this paragraph (a), then
such Person shall not be deemed to be an "Acquiring Person" for
any purposes of this Agreement.
(b) "Affiliate" shall have the meaning ascribed to
such term in Rule 12b-2 of the General Rules and Regulations under
the Exchange Act as in effect on the date of this Agreement.
(c) "Approved Transaction" shall mean either (i) a
tender offer to all of the holders of each class of Common Stock
(A) which provides for the acquisition by the tender offeror of
all of the issued and outstanding shares of both Class A Common
and Class B Common (other than shares of Common Stock held by an
Acquiring Person or its Associates or Affiliates) solely for cash;
(B) following which tender offer the tender offeror exercises
reasonable best efforts to consummate a statutory merger within 90
days of the date of the tender offer pursuant to which the shares
of Common Stock not tendered pursuant to the tender offer are
exchanged for cash on terms no less favorable to the holders of
such Common Stock as was offered in the tender offer; and (C)
which a majority of the Board of Directors of the Company, prior
to the date on which such tender offer was commenced, shall have
approved and, after receiving advice from one or more investment
banking firms, determined to be fair to the holders of Common
Stock from a financial point of view, taking into account all
factors which such members of the Board deem relevant including,
without limitation, values indicated in light of long-term
prospects or business plans or aggregate prices or values which
could reasonably be achieved if part or all of the Company or its
assets were sold or restructured on an orderly basis designed to
realize maximum long-term value; or (ii) a statutory merger (A) in
which all shares of Common Stock are exchanged for cash, and (B)
which a majority of the Board of Directors of the Company, prior
to the date on which the merger was agreed upon, shall have
approved and, after receiving advice from one or more investment
banking firms, determined to be fair to the holders of the Common
Stock from a financial point of view, taking into account all
factors which such members of the Board deem relevant including,
without limitation, values indicated in light of long-term
prospects or business plans or aggregate prices or values which
could reasonably be achieved if part or all of the Company or its
assets were sold or restructured on an orderly basis designed to
realize maximum long-term value.
(d) "Associate" shall have the meaning ascribed to
such term in Rule 12b-2 of the General Rules and Regulations under
the Exchange Act as in effect on the date of this Agreement.
(e) 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;
<PAGE>
(ii) which such Person or any of such Person's
Affiliates or Associates has (A) the right to acquire (whether
such right is exercisable immediately or only after the passage of
time) pursuant to any agreement, arrangement or understanding
(other than customary agreements with and between underwriters and
selling group members with respect to a bona fide public offering
of securities), or upon the exercise of conversion rights,
exchange rights, rights (other than these Rights), warrants or
options, or otherwise; provided, however, that a Person shall not
be deemed the Beneficial Owner of, or to beneficially own,
securities tendered pursuant to a tender or exchange offer made by
or on behalf of such Person or any of such Person's Affiliates or
Associates until such tendered securities are accepted for
purchase or exchange; or (B) the right to vote pursuant to any
agreement, arrangement or understanding; provided, however, that a
Person shall not be deemed the Beneficial Owner of, or to
beneficially own, any security if the agreement, arrangement or
understanding to vote such security (1) arises solely from a
revocable proxy or consent given to such Person in response to a
public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable rules and regulations promulgated
under the Exchange Act and (2) is not also then reportable on
Schedule 13D under the Exchange Act (or any comparable or
successor report); or
(iii)which are beneficially owned, directly or
indirectly, by any other Person with which such Person or any of
such Person's Affiliates or Associates has any agreement,
arrangement or understanding (other than customary agreements with
and between underwriters and selling group members with respect to
a bona fide public offering of securities) for the purpose of
acquiring, holding, voting (except to the extent contemplated by
the proviso to Section 1(d)(ii)(B)) or disposing of any securities
of the Company.
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 Company, shall mean the number of such
securities then issued and outstanding together with the number of
such securities not then actually issued and outstanding which
such Person would be deemed to own beneficially hereunder.
(f) "Business Day" shall mean any day other than a
Saturday, a Sunday, or a day on which banking institutions in
Baltimore, Maryland and in the state in which the principal office
of the Rights Agent is located are authorized or obligated by law
or executive order to close.
(g) "Class" shall mean the Class A Common or the Class
B Common, or both, as the context may require.
<PAGE>
(h) "Class A Common" means Class A Common Stock of the
Company, $5.00 par value.
(i) "Class B Common" means Class B Common Stock of the
Company, $5.00 par value.
(j) "Close of Business" on any given date shall mean
5:00 P.M., Baltimore, Maryland time, on such date; provided,
however, that, if such date is not a Business Day, it shall mean
5:00 P.M., Baltimore, Maryland time, on the next succeeding
Business Day.
(k) "Common Stock" when used with reference to the
Company shall mean the shares of Class A Common and Class B
Common, provided, however, that percentages of Class A Common and
Class B Common shall be calculated separately by class. "Common
Stock" when used with reference to any Person other than the
Company shall mean the capital stock (or equity interest) with the
greatest voting power of such other Person or, if such other
Person is a Subsidiary of another Person, the Person or Persons
which ultimately control such first-mentioned Person.
(l) "Company" shall have the meaning set forth in the
preamble hereof.
(m) "current per share market price" shall have the
meaning set forth in Section 11(d) hereof.
(n) "Distribution Date" shall have the meaning set
forth in Section 3 hereof.
(o) "equivalent preferred shares" shall have the
meaning set forth in Section 11(b) hereof.
(p) "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended.
(q) "Exchange Ratio" shall have the meaning set forth
in Section 24(a) hereof.
(r) "Final Expiration Date" shall have the meaning set
forth in Section 7(a) hereof.
(s) "NASDAQ" shall mean the National Association of
Securities Dealers, Inc. Automated Quotations System.
(t) "Person" shall mean any individual, firm,
corporation, partnership, limited liability company or other
entity, and shall include any successor (by merger or otherwise)
of such entity.
(u) "Preferred Stock" shall mean the shares of Series
A Preferred and Series B Preferred.
(v) "Purchase Price" shall have the meaning set forth
in Section 7(b) hereof.
<PAGE>
(w) "Record Date" shall have the meaning set forth in
the second paragraph hereof.
(x) "Redemption Date" shall have the meaning set forth
in Section 7(a) hereof.
(y) "Redemption Price" shall have the meaning set
forth in Section 23(a) hereof.
(z) "Rights Agent" shall have the meaning set forth in
the preamble hereof.
(aa) "Right" shall mean a Series A Right or a Series B
Right, and "Rights" in the plural shall mean either or both as the
context requires.
(bb) "Right Certificate" shall have the meaning set
forth in Section 3(a) hereof.
(cc) "Security" shall have the meaning set forth in
Section 11(d) hereof.
(dd) "Series A Preferred" shall mean the shares of
Series A Junior Participating Preferred Stock, no par value, of
the Company having the rights and preferences set forth in the
Articles Supplementary of the Company establishing such series of
preferred stock.
(ee) "Series A Right" shall have the meaning set forth
in the second paragraph hereof.
(ff) "Series B Preferred" shall mean shares of Series B
Junior Participating Preferred Stock, no par value, of the Company
having the rights and preferences set forth in the Articles
Supplementary of the Company establishing such series of preferred
stock.
(gg) "Series B Right" shall have the meaning set forth
in the second paragraph hereof.
(hh) "Stock Acquisition Date" shall mean the first date
of public announcement by the Company or an Acquiring Person that
an Acquiring Person has become such.
(ii) "Subsidiary" of any Person shall mean any
corporation or other entity of which a majority of the voting
power of the voting equity securities or equity interest is owned,
directly or indirectly, by such Person.
(jj) "Substantial Block" shall be calculated separately
by Class of Common Stock and, with respect to each Class of Common
Stock, shall mean (1) for any Person who on the date of this
Agreement beneficially owns a number of shares that is less than
14% of the total number of then outstanding shares of such Class
of Common Stock, a number of shares of such Class of Common Stock
that exceeds 15% of the total number of then outstanding shares of
such Class of Common Stock, or (2) for any Person who on the date
of this Agreement beneficially owns a number of shares that is
equal to or exceeds 14% of the total number of outstanding shares
of such Class of Common Stock, the number of shares of such Class
of Common Stock as disclosed on such Person's Schedule 13D or 13G,
as the
<PAGE>
case may be, most recently filed with the Securities and Exchange
Commission prior to the date of this Agreement, plus an additional
number of shares of such Class of Common Stock that exceeds 1% of
the total number of shares of such Class of Common Stock
outstanding on the date of this Agreement.
(kk) "Summary of Rights" shall have the meaning set
forth in Section 3(b) hereof.
(ll) "Trading Day" shall have the meaning set forth in
Section 11(d) hereof.
Section 2. APPOINTMENT OF RIGHTS AGENT. The Company hereby
appoints the Rights Agent to act as agent for the Company and the
holders of the Rights (who, in accordance with Section 3 hereof,
shall, prior to the Distribution Date, also be the holders of the
Common Stock) in accordance with the terms and conditions hereof,
and the Rights Agent hereby accepts such appointment. The Company
may from time to time appoint such co-Rights Agents as it may deem
necessary or desirable.
SECTION 3. ISSUE OF RIGHT CERTIFICATES.
(a) Until the earlier of (i) the tenth day after
the Stock Acquisition Date or (ii) the tenth Business Day (or such
later date as may be determined by action of the Board of
Directors of the Company prior to such time as any Person becomes
an Acquiring Person) after the date of the commencement by any
Person (other than the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or of any Subsidiary of the
Company or any entity holding Common Stock 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 Company, any
Subsidiary of the Company, any employee benefit plan of the
Company or of any Subsidiary of the Company or any entity holding
Common Stock for or pursuant to the terms of any such plan) to
commence, a tender offer (other than a tender offer which is an
Approved Transaction) or exchange offer, the consummation of which
may result in any Person becoming the Beneficial Owner of a
Substantial Block (the earlier of such dates being herein referred
to as the "Distribution Date") of either Class of Common Stock,
(x) the Rights associated with each Class of Common Stock will be
evidenced (subject to the provisions of Section 3(b) hereof) by
the certificates for such Class of Common Stock 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 associated
Common Stock. As soon as practicable after the Distribution Date,
the Company will prepare and execute, the Rights Agent will
countersign, and the Company will send or cause to be sent (and
the Rights Agent will, if requested in writing by the Company,
send) by first-class, insured, postage-prepaid mail, to each
record holder of Common Stock as of the close of business on the
Distribution Date, at the address of such holder shown on the
records of the Company, a Right Certificate, in substantially the
form of Exhibit A-1 (Series A Rights) and Exhibit A-2 (Series B
Rights) hereto (each a "Right Certificate"), evidencing one Series
A Right for each share of Class A Common so held and one Series B
Right for each share of Class B Common so held. If the Company
requests that the Rights Agent send such Rights Certificates, it
shall timely provide to the Rights Agent a list, in physical and
acceptable electronic formats, of the holders of Common Stock as
of the close of business on the
<PAGE>
Distribution Date with the address of each such holder as shown on
the records of the Company. As of the Distribution Date, the
Rights will be evidenced solely by such Right Certificates.
(b) On the Record Date, or as soon as practicable
thereafter, the Company will send a copy of a Summary of Rights to
Purchase Preferred Stock, in substantially the form of Exhibit B
hereto (the "Summary of Rights"), by first-class, postage-prepaid
mail, to each record holder of Common Stock as of the Close of
Business on the Record Date, at the address of such holder shown
on the records of the Company. With respect to certificates for
Common Stock outstanding as of the Record Date, until the
Distribution Date, the Rights will be evidenced by such
certificates 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 transfer of any Common
Stock outstanding on the Record Date, including the surrender for
transfer of any certificate representing such Common Stock with or
without a copy of the Summary of Rights attached thereto, shall
also constitute the transfer of the Rights associated with such
Common Stock.
(c) Certificates for Common Stock which become
outstanding (whether upon issuance out of authorized but unissued
Common Stock or issuance upon transfer or exchange of outstanding
Common Stock) after the Record Date but prior to the earliest of
the Distribution Date, the Redemption Date or the Final Expiration
Date shall have impressed on, printed on, written on or otherwise
affixed to them, in the case of share certificates, the following
legend:
This certificate also evidences and entitles the holder
hereof to certain rights as set forth in a Rights Agreement
between Crown Central Petroleum Corporation and First Union
National Bank, dated as of February 1, 2000 (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 Crown Central Petroleum 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. Crown Central Petroleum
Corporation will mail to the holder of this certificate a copy of
the Rights Agreement without charge after receipt of a written
request therefor. Under certain circumstances, as set forth in
the Rights Agreement, Rights issued to any Person who becomes an
Acquiring Person (as defined in the Rights Agreement) will become
null and void.
With respect to such certificates containing the foregoing legend,
until the Distribution Date, the Rights associated with the Common
Stock represented by such certificates shall be evidenced by such
certificates alone, and the surrender for transfer of any such
certificate shall also constitute the transfer of the Rights
associated with the Common Stock represented thereby. In the
event that the Company purchases or acquires any Common Stock
after the Record Date but prior to the Distribution Date or Final
Expiration Date, any Rights associated with such Common Stock
shall be deemed cancelled and retired so that the Company shall
not be entitled to exercise any Rights associated with shares of
Common Stock which are no longer outstanding.
<PAGE>
SECTION 4. FORM OF RIGHT CERTIFICATES. The Right
Certificates (and the forms of election to purchase Preferred
Stock and of assignment to be printed on the reverse thereof)
shall be substantially the same as Exhibit A-1 with respect to
Series A Rights and Exhibit A-2 with respect to Series B Rights,
and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company
may deem appropriate and as are not inconsistent with the
provisions of this Agreement, or as may be required to comply with
any applicable law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on
which the Rights may from time to time be listed, or to conform to
usage. Subject to the provisions of Section 22 hereof, the Series
A Right Certificates shall entitle the holders thereof to purchase
such number of one one-thousandths of a share of Series A
Preferred as shall be set forth therein at the price per one
one-thousandth of a share of Series A Preferred set forth therein
and the Series B Right Certificates shall entitle the holders
thereof to purchase such number of one one-thousandths of a share
of Series B Preferred as shall be set forth therein at the price
per one one-thousandth of a share of Series B Preferred set forth
therein, but the number of such one one-thousandths of such shares
of Preferred Stock and the Purchase Price thereof shall be subject
to adjustment as provided herein.
SECTION 5. COUNTERSIGNATURE AND REGISTRATION. The Right
Certificates shall be executed on behalf of the Company by its
Chairman of the Board, its Chief Executive Officer, its President,
any of its Vice Presidents, or its Treasurer, either manually or
by facsimile signature, shall have affixed thereto the Company's
seal or a facsimile thereof, and shall be attested by the
Secretary or an Assistant Secretary of the Company, either
manually or by facsimile signature. The Right Certificates shall
be manually countersigned by the Rights Agent and shall not be
valid for any purpose unless countersigned. In case any officer
of the Company who shall have signed any of the Right Certificates
shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by
the Company, such Right Certificates, nevertheless, may be
countersigned by the Rights Agent and issued and delivered by the
Company with the same force and effect as though the Person who
signed such Right Certificates had not ceased to be such officer
of the Company; and any Right Certificate may be signed on behalf
of the Company by any Person who, at the actual date of the
execution of such Right Certificate, shall be a proper officer of
the Company to sign such Right Certificate although at the date of
the execution of this Rights Agreement any such Person was not
such an officer.
Following the Distribution Date, the Rights Agent will keep
or cause to be kept, at its principal office, books for
registration and transfer of the Right Certificates issued
hereunder; provided that if the Company, rather than the Rights
Agent, sends the Rights Certificates pursuant to Section 3(a), the
Company shall timely provide to the Rights Agent a list, in
physical and acceptable electronic formats, of the holders of
Common Stock as of the close of business on the Distribution Date
with the address of each such holder as shown on the records of
the Company. Such books shall show the names and addresses of the
respective holders of the Right Certificates, the number of Rights
evidenced on its face by each of the Right Certificates and the
date of each of the Right Certificates.
SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF
RIGHT CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHT
CERTIFICATES. Subject to the provisions of Section 14 hereof, at
any time after the Close of Business on the Distribution Date, and
<PAGE>
at or prior to the Close of Business on the earlier of the
Redemption Date or the Final Expiration Date, any Right
Certificate or Right Certificates (other than Right Certificates
representing Rights that have become void pursuant to Section
11(a)(ii) hereof or that have been exchanged pursuant to Section
24 hereof) may be transferred, split up, combined or exchanged for
another Right Certificate or Right Certificates entitling the
registered holder to purchase a like number of one one-thousandths
of a share of Preferred Stock as the Right Certificate or Right
Certificates surrendered then entitled such holder to purchase.
Any registered holder desiring to transfer, split up, combine or
exchange any Right Certificate or Right Certificates shall make
such request in writing delivered to the Rights Agent, and shall
surrender the Right Certificate or Right Certificates to be
transferred, split up, combined or exchanged at the principal
office of the Rights Agent. Thereupon the Rights Agent shall
countersign and deliver to the Person entitled thereto a Right
Certificate or Right Certificates, as the case may be, as so
requested. The Company may require payment of a sum sufficient to
cover any tax or governmental charge that may be imposed in
connection with any transfer, split up, combination or exchange of
Right Certificates.
Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to
them, and, at the Company's request, reimbursement to the Company
and the Rights Agent of all reasonable expenses incidental
thereto, and upon surrender to the Rights Agent and cancellation
of the Right Certificate if mutilated, the Company will make and
deliver a new Right Certificate of like tenor to the Rights Agent
for delivery to the registered holder in lieu of the Right
Certificate so lost, stolen, destroyed or mutilated.
SECTION 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION
DATE OF RIGHTS.
(a) The registered holder of any Right Certificate
may exercise the Rights evidenced thereby (except as otherwise
provided herein), in whole or in part, at any time after the
Distribution Date, upon surrender of the Right Certificate, with
the form of election to purchase on the reverse side thereof duly
executed, to the Rights Agent at the principal office of the
Rights Agent, together with payment of the Purchase Price for each
one one-thousandth of a share of Series A Preferred or Series B
Preferred as to which the Rights are exercised, at or prior to the
earliest of (i) the Close of Business on February 14, 2001 (the
"Final Expiration Date"), (ii) the time at which the Rights are
redeemed as provided in Section 23 hereof (the "Redemption Date"),
or (iii) the time at which such Rights are exchanged as provided
in Section 24 hereof.
(b) The Purchase Price for each one one-thousandth
of a share of Series A Preferred and for each one one-thousandth
of a share of Series B Preferred purchasable pursuant to the
exercise of a Right shall initially be $16, and shall be subject
to adjustment from time to time as provided in Section 11 or 13
hereof (the "Purchase Price") and shall be payable in lawful money
of the United States of America in accordance with paragraph (c)
below.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase duly
executed, accompanied by payment of the Purchase Price for the
shares to be purchased and an amount equal to any applicable
transfer tax required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof by certified
check,
<PAGE>
cashier's check or money order payable to the order of the
Company, the Rights Agent shall thereupon promptly (i) (A)
requisition from any transfer agent of the Preferred Stock
certificates for the number of shares of Preferred Stock to be
purchased and the Company hereby irrevocably authorizes any such
transfer agent to comply with all such requests, or (B)
requisition from the depositary agent depositary receipts
representing such number of one one-thousandths of a share of
Preferred Stock as are to be purchased (in which case certificates
for the shares of Preferred Stock represented by such receipts
shall be deposited by the transfer agent of the Preferred Stock
with such depositary agent) and the Company hereby directs such
depositary agent to comply with such request; (ii) when
appropriate, requisition from the Company the amount of cash to be
paid in lieu of issuance of fractional shares in accordance with
Section 14 hereof; (iii) after receipt of such certificates or
depositary receipts, cause the same to be delivered to or upon the
order of the registered holder of such Right Certificate,
registered in such name or names as may be designated by such
holder; and (iv) when appropriate, after receipt, deliver such
cash to or upon the order of the registered holder of such Right
Certificate.
(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.
SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHT
CERTIFICATES. All Right Certificates surrendered for the purpose
of exercise, transfer, split up, combination or exchange shall, if
surrendered to the Company or to any of its agents, be delivered
to the Rights Agent for cancellation or in cancelled form, or, if
surrendered to the Rights Agent, shall be cancelled by it, and no
Right Certificates shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Agreement.
The Company shall deliver to the Rights Agent for cancellation and
retirement, and the Rights Agent shall so cancel and retire, any
other Right Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall
deliver all cancelled Right Certificates to the Company, or shall,
at the written request of the Company, destroy such cancelled
Right Certificates, and, in such case, shall deliver a certificate
of destruction thereof to the Company.
SECTION 9. Availability of Preferred Stock. The Company
covenants and agrees that it will cause to be reserved and kept
available out of its authorized and unissued Preferred Stock , the
number of shares of Preferred Stock that will be sufficient to
permit the exercise in full of all outstanding Rights in
accordance with Section 7. The Company covenants and agrees that
it will take all such action as may be necessary to ensure that
all shares of Preferred Stock delivered upon exercise of Rights
shall, at the time of delivery of the certificates for such shares
of Preferred Stock (subject to payment of the Purchase Price), be
duly and validly authorized and issued and fully paid and
nonassessable shares.
The Company further covenants and agrees that it will pay when
due and payable any and all federal and state transfer taxes and
charges which may be payable in respect of the issuance or
delivery of the Right Certificates or of any shares of Preferred
Stock upon the exercise of Rights. The Company shall not,
however, be required to pay any transfer tax which may be payable
in respect of
<PAGE>
any transfer or delivery of Right Certificates to a Person other
than, or the issuance or delivery of certificates or depositary
receipts for the shares of Preferred Stock 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 shares of Preferred Stock
upon the exercise of any Rights until any such tax shall have
been paid (any such tax being payable by the holder of such Right
Certificate at the time of surrender) or until it has been
established to the Company's reasonable satisfaction that no such
tax is due.
10. PREFERRED STOCK RECORD DATE. Each Person in whose name
any SECTION certificate for Preferred Stock is issued upon the
exercise of Rights shall for all purposes be deemed to have become
the holder of record of the Preferred Stock represented thereby
on, and such certificate shall be dated, the date upon which the
Right Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and any applicable transfer taxes)
was made; provided, however, that if the date of such surrender
and payment is a date upon which the Preferred Stock transfer
books of the Company are closed, such Person shall be deemed to
have become the record holder of such shares on, and such
certificate shall be dated, the next succeeding Business Day on
which the Preferred Stock transfer books of the Company are open.
Prior to the exercise of the Rights evidenced thereby, the holder
of a Right Certificate shall not be entitled to any rights of a
holder of Preferred Stock for which the Rights shall be
exercisable, including, without limitation, the right to vote, to
receive dividends or other distributions or to exercise any
preemptive rights, and shall not be entitled to receive any notice
of any proceedings of the Company, except as provided herein.
SECTION 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER OF SHARES
OR NUMBER OF RIGHTS. The Purchase Price, the number of shares of
Preferred Stock covered by each Right and the number of Rights
outstanding are subject to adjustment from time to time as
provided in this Section 11.
(a) (i) In the event the Company shall at any
time after the date of this Agreement (A) declare a dividend on
Preferred Stock payable in Preferred Stock, (B) subdivide the
outstanding Preferred Stock, (C) combine the outstanding Preferred
Stock into a smaller number of shares of Preferred Stock or (D)
issue any shares of its capital stock in a reclassification of the
Preferred Stock (including any such reclassification in connection
with a consolidation or merger in which the Company is the
continuing or surviving corporation), except as otherwise provided
in this Section 11(a), the Purchase Price in effect at the time of
the record date for such dividend or of the effective date of such
subdivision, combination or reclassification, and the number and
kind of shares of capital stock issuable on such date, shall be
proportionately adjusted so that the holder of any Right exercised
after such time shall be entitled to receive the aggregate number
and kind of shares of capital stock which, if such Right had been
exercised immediately prior to such date and at a time when the
Preferred Stock transfer books of the Company were open, he would
have owned upon such exercise and been entitled to receive by
virtue of such dividend, subdivision, combination or
reclassification; provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right be less
than the aggregate par value of the shares of capital stock of the
Company issuable upon exercise of one Right.
<PAGE>
(ii) Subject to Section 24 of this Agreement,
in the event any Person becomes an Acquiring Person, each holder
of a Right shall thereafter have a right to receive, upon exercise
thereof at a price equal to the then current Purchase Price
multiplied by the number of one one-thousandths of a share of
Preferred Stock for which such Right is then exercisable, in
accordance with the terms of this Agreement and (i) in lieu of
shares of Series A Preferred, such number of shares of Class A
Common of the Company as shall equal the result obtained by (A)
multiplying the then current Purchase Price by the number of one
one-thousandths of a share of Series A Preferred for which such
Right is then exercisable and dividing that product by (B) 50% of
the then current per share market price of the Company's Class A
Common (determined pursuant to Section 11(d) hereof) on the date
of the occurrence of such event, and (ii) in lieu of shares of
Series B Preferred, such number of shares of Class B Common of the
Company as shall equal the result obtained by (A) multiplying the
then current Purchase Price by the number of one one-thousandths
of a share of Series B Preferred for which such Right is then
exercisable and dividing that product by (B) 50% of the then
current per share market price of the Company's Class B Common
(determined pursuant to Section 11(d) hereof) on the date of the
occurrence of such event. In the event that any Person shall
become an Acquiring Person and Rights shall then be outstanding,
the Company shall not take any action which would eliminate or
diminish the benefits intended to be afforded by the Rights.
From and after the occurrence of such event, any Rights that
are or were acquired or beneficially owned by any Acquiring Person
(or any Associate or Affiliate of such Acquiring Person) shall be
void and any holder of such Rights shall thereafter have no right
to exercise such Rights under any provision of this Agreement. No
Right Certificate shall be issued pursuant to Section 3 that
represents Rights beneficially owned by an Acquiring Person whose
Rights would be void pursuant to the preceding sentence or any
Associate or Affiliate thereof; no Right Certificate shall be
issued at any time upon the transfer of any Rights to an Acquiring
Person whose Rights would be void pursuant to the preceding
sentence or any Associate or Affiliate thereof or to any nominee
of such Acquiring Person, Associate or Affiliate; and any Right
Certificate delivered to the Rights Agent for transfer to an
Acquiring Person whose Rights would be void pursuant to the
preceding sentence shall be cancelled.
(iii) In the event that there shall not be sufficient
Class A Common authorized but unissued to permit the exercise in
full of the Series A Rights in accordance with the foregoing
subparagraph (ii), the Company shall take all such action as may
be necessary to authorize additional Class A Common for issuance
upon exercise of the Series A Rights. In the event the Company
shall, after good faith effort, be unable to take all such action
as may be necessary to authorize such additional Class A Common,
the Company shall substitute, for each Class A Common share that
would otherwise be issuable upon exercise of a Series A Right, a
number of shares of Series A Preferred or fraction thereof such
that the current per share market price of one share of Series A
Preferred multiplied by such number or fraction is equal to the
current per share market price of one Class A Common share as of
the date of issuance of such shares of Series A Preferred or
fraction thereof.
(iv) In the event that there shall not be sufficient
Class B Common authorized but unissued to permit the exercise in
full of the Series B Rights in accordance with the foregoing
subparagraph (ii), the Company shall take all such action as may
be necessary to authorize additional Class B Common for issuance
upon exercise of the Series B Rights. In the event the Company
shall, after good
<PAGE>
faith effort, be unable to take all such action as may be
necessary to authorize such additional Class B Common, the Company
shall substitute, for each Class B Common share that would
otherwise be issuable upon exercise of a Series B Right, a number
of shares of Series B Preferred or fraction thereof such that the
current per share market price of one share of Series B Preferred
multiplied by such number or fraction is equal to the current per
share market price of one Class B Common share as of the date of
issuance of such shares of Series B Preferred or fraction thereof.
(b) In case the Company shall fix a record date for
the issuance of rights, options or warrants to all holders of
shares of Series A Preferred and/or Series B Preferred entitling
them (for a period expiring within 45 calendar days after such
record date) to subscribe for or purchase shares of such
corresponding class of Preferred Stock (or shares having the same
rights, privileges and preferences as shares of such corresponding
class of Preferred Stock ("equivalent preferred shares")) or
securities convertible into shares of such corresponding class of
Preferred Stock or equivalent preferred shares at a price per
share of Preferred Stock or equivalent preferred shares (or having
a conversion price per share, if a security convertible into
Preferred Stock or equivalent preferred shares) less than the then
current per share market price of such Preferred Stock on such
record date, the Purchase Price to be in effect after such record
date shall be determined by multiplying the Purchase Price in
effect for such Preferred Stock immediately prior to such record
date by a fraction, the numerator of which shall be the number of
shares of Series A Preferred and/or Series B Preferred, as the
case may be, outstanding on such record date plus the number of
shares of such Preferred Stock which the aggregate offering price
of the total number of shares of such Preferred Stock and/or
equivalent preferred shares so to be offered (and/or the aggregate
initial conversion price of the convertible securities so to be
offered) would purchase at such current market price and the
denominator of which shall be the number of shares of such
Preferred Stock outstanding on such record date plus the number of
additional shares of Series A Preferred and/or Series B Preferred,
as the case may be, 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
Company issuable upon exercise of one Right. In case such
subscription price may be paid in a consideration part or all of
which shall be in a form other than cash, the value of such
consideration shall be as determined in good faith by the Board of
Directors of the Company, whose determination shall be described
in a written statement filed with the Rights Agent. Preferred
Stock owned by or held for the account of the Company shall not be
deemed outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date
is fixed; and in the event that such rights, options or warrants
are not so issued, the Purchase Price shall be adjusted to be the
Purchase Price which would then be in effect if such record date
had not been fixed.
(c) In case the Company shall fix a record date for
the making of a distribution to all holders of the shares of
Series A Preferred and/or Series B Preferred, as the case may be,
(including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing or
surviving corporation) of evidences of indebtedness or assets
(other than a regular quarterly cash dividend or a dividend
payable in shares of Series A Preferred and/or Series B Preferred,
as the case may be) or subscription rights or warrants (excluding
those referred to in Section 11(b) hereof), the Purchase Price to
be in
<PAGE>
effect after such record date shall be determined by multiplying
the Purchase Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the then current
per share market price of such Preferred Stock on such record
date, less the fair market value (as determined in good faith by
the Board of Directors of the Company, whose determination shall
be described in a statement filed with the Rights Agent) of the
portion of the assets or evidences of indebtedness so to be
distributed or of such subscription rights or warrants applicable
to one share of Series A Preferred and/or Series B Preferred, as
the case may be, and the denominator of which shall be such
current per share market price of such Preferred Stock; provided,
however, that in no event shall the consideration to be paid upon
the exercise of one Right be less than the aggregate par value of
the shares of capital stock of the Company to be issued upon
exercise of one Right. Such adjustments shall be made
successively whenever such a record date is fixed; and in the
event that such distribution is not so made, the Purchase Price
shall again be adjusted to be the Purchase Price which would then
be in effect if such record date had not been fixed.
(d) (i) 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 30 consecutive Trading Days
immediately prior to such date; provided, however, that in the
event that the current per share market price of the Security is
determined during a period following the announcement by the
issuer of such Security of (A) a dividend or distribution on such
Security payable in shares of such Security or securities
convertible into such shares, or (B) any subdivision, combination
or reclassification of such Security and prior to the expiration
of 30 Trading Days after the ex-dividend date for such dividend or
distribution, or the record date for such subdivision, combination
or reclassification, then, and in each such case, the current per
share market price shall be appropriately adjusted to reflect the
current market price per share equivalent of such Security. The
closing price for each day shall be the last sale price, regular
way, or, in case no such sale takes place on such day, the average
of the closing bid and asked prices, regular way, in either case,
as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on
the American Stock Exchange or, if the Security is not listed or
admitted to trading on the American 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 average of the high bid and low asked prices in the
over-the-counter market, as reported by NASDAQ or such other
system then in use, or, if on any such date the Security is not
quoted by any such organization, the average of the closing bid
and asked prices as furnished by a professional market maker
making a market in the Security selected by the Board of Directors
of the Company. The term "Trading Day" shall mean a day on which
the principal national securities exchange on which the Security
is listed or admitted to trading is open for the transaction of
business or, if the Security is not listed or admitted to trading
on any national securities exchange, a Business Day.
(ii) For the purpose of any computation
hereunder, the "current per share market price" of shares of
Series A Preferred and/or Series B Preferred shall be determined
in accordance with the method set forth in Section 11(d)(i). If
any such shares of Preferred Stock are not publicly traded, the
"current per share market price" of the shares of Series A
Preferred shall be conclusively deemed to be the current per share
market price of the Class A Common and the "current per share
<PAGE>
market price" of the shares of Series B Preferred shall be
conclusively deemed to be the current per share market price of
the Class B Common, each 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 thousand. If the Class A Common and the Series
A Preferred, and the Class B Common and the Series B Preferred,
are not publicly held or so listed or traded, "current per share
market price" shall mean the fair value per share as determined in
good faith by the Board of Directors of the Company, whose
determination shall be described in a written statement filed with
the Rights Agent.
(e) No adjustment in the Purchase Price shall be
required unless such adjustment would require an increase or
decrease of at least 1% in the Purchase Price; provided, however,
that any adjustments which by reason of this Section 11(e) are not
required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under this
Section 11 shall be made to the nearest cent or to the nearest one
one-millionth of a share of Preferred Stock 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 years from the date of the transaction
which requires such adjustment, or (ii) the date of the expiration
of the right to exercise any Rights.
(f) If, as a result of an adjustment made pursuant
to Section 11(a) hereof, the holder of any Right thereafter
exercised shall become entitled to receive any shares of capital
stock of the Company other than shares of Preferred Stock,
thereafter the number of such other shares so receivable upon
exercise of any Right shall be subject to adjustment from time to
time in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the shares of Preferred Stock
contained in Section 11(a) through (c), inclusive, and the
provisions of Sections 7, 9, 10 and 13 with respect to the shares
of Preferred Stock shall apply on like terms to any such other
shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder
shall evidence the right to purchase, at the adjusted Purchase
Price, the number of one one-thousandths of a share of Preferred
Stock purchasable from time to time hereunder upon exercise of the
Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its
election as provided in Section 11(i), upon each adjustment of the
Purchase Price as a result of the calculations made in Sections
11(b) and (c), each Right outstanding immediately prior to the
making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of one
one-thousandths of a share of Preferred Stock (calculated to the
nearest one one-millionth of a share of Preferred Stock) obtained
by (A) multiplying (x) the number of one one-thousandths of a
share covered by a Right immediately prior to this adjustment by
(y) the Purchase Price in effect immediately prior to such
adjustment of the Purchase Price and (B) dividing the product so
obtained by the Purchase Price in effect immediately after such
adjustment of the Purchase Price.
(i) The Company may elect on or after the date of
any adjustment of the Purchase Price to adjust the number of
Rights in substitution for any adjustment in the number of one
<PAGE>
one-thousandths of a share of Preferred Stock purchasable upon the
exercise of a Right. Each of the Rights outstanding after such
adjustment of the number of Rights shall be exercisable for the
number of one one-thousandths of a share of Preferred Stock for
which a Right was exercisable immediately prior to such
adjustment. Each Right held of record prior to such adjustment of
the number of Rights shall become that number of Rights
(calculated to the nearest one ten-thousandth) obtained by
dividing the Purchase Price in effect immediately prior to
adjustment of the Purchase Price by the Purchase Price in effect
immediately after adjustment of the Purchase Price. The Company
shall make a public announcement of its election to adjust the
number of Rights, indicating the record date for the adjustment,
and, if known at the time, the amount of the adjustment to be
made. This record date may be the date on which the Purchase
Price is adjusted or any day thereafter, but, if the Right
Certificates have been issued, shall be at least 10 days later
than the date of the public announcement. If Right Certificates
have been issued, upon each adjustment of the number of Rights
pursuant to this Section 11(i), the Company shall, as promptly as
practicable, cause to be distributed to holders of record of Right
Certificates on such record date Right Certificates evidencing,
subject to Section 14 hereof, the additional Rights to which such
holders shall be entitled as a result of such adjustment, or, at
the option of the Company, shall cause to be distributed to such
holders of record in substitution and replacement for the Right
Certificates held by such holders prior to the date of adjustment,
and upon surrender thereof, if required by the Company, new Right
Certificates evidencing all the Rights to which such holders shall
be entitled after such adjustment. Right Certificates so to be
distributed shall be issued, executed and countersigned in the
manner provided for herein and shall be registered in the names of
the holders of record of Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the
Purchase Price or the number of one one-thousandths of a share of
Preferred Stock issuable upon the exercise of the Rights, the
Right Certificates theretofore and thereafter issued may continue
to express the Purchase Price and the number of one
one-thousandths of a share of Preferred Stock which were expressed
in the initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an
adjustment reducing the Purchase Price below one one-thousandth of
the then par value, if any, of the shares of Preferred Stock
issuable upon exercise of the Rights, the Company shall take any
corporate action which may, in the opinion of its counsel, be
necessary in order that the Company may validly and legally issue
fully paid and nonassessable shares of Preferred Stock at such
adjusted Purchase Price.
(l) In any case in which this Section 11 shall
require that an adjustment in the Purchase Price be made effective
as of a record date for a specified event, the Company may elect
to defer until the occurrence of such event the issuing to the
holder of any Right exercised after such record date of the
Preferred Stock and other capital stock or securities of the
Company, if any, issuable upon such exercise over and above the
Preferred Stock and other capital stock or securities of the
Company, if any, issuable upon such exercise on the basis of the
Purchase Price in effect prior to such adjustment; provided,
however, that the Company shall deliver to such holder a due bill
or other appropriate instrument evidencing such holder's right to
receive such additional shares upon the occurrence of the event
requiring such adjustment.
<PAGE>
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such
reductions in the Purchase Price, in addition to those adjustments
expressly required by this Section 11, as and to the extent that
it, in its sole discretion, shall determine to be advisable in
order that any consolidation or subdivision of the Series A
Preferred and/or Series B Preferred, issuance wholly for cash of
any shares of Preferred Stock at less than the current market
price, issuance wholly for cash of shares of Preferred Stock or
securities which by their terms are convertible into or
exchangeable for shares of Preferred Stock, dividends on shares of
Preferred Stock payable in shares of Preferred Stock or issuance
of rights, options or warrants referred to hereinabove in Section
11(b), hereafter made by the Company to holders of its Preferred
Stock shall not be taxable to such stockholders.
(n) In the event that at any time after the date of
this Agreement and prior to the Distribution Date, the Company
shall (i) declare or pay any dividend on the Class A Common and/or
Class B Common payable in shares of Common Stock or (ii) effect a
subdivision, combination or consolidation of one or both of the
classes of Common Stock (by reclassification or otherwise than by
payment of dividends in shares of Common Stock) into a greater or
lesser number of shares of Common Stock, then in any such case (A)
the number of one one-thousandths of a share of Series A Preferred
and/or Series B Preferred purchasable after such event upon proper
exercise of each Right shall be determined by multiplying the
number of one one-thousandths of a share of such Preferred Stock
so purchasable immediately prior to such event by a fraction, the
numerator of which is the number of shares of corresponding Common
Stock outstanding immediately before such event and the
denominator of which is the number of shares of corresponding
Common Stock outstanding immediately after such event, and (B)
each share of corresponding Common Stock outstanding immediately
after such event shall have issued with respect to it that number
of Rights which each share of corresponding Common Stock
outstanding immediately prior to such event had issued with
respect to it. The adjustments provided for in this Section 11(n)
shall be made successively whenever such a dividend is declared or
paid or such a subdivision, combination or consolidation is
effected.
SECTION 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR
NUMBER OF SHARES. Whenever an adjustment is made as provided in
Section 11 or 13 hereof, the Company shall promptly (a) prepare a
certificate setting forth such adjustment, and a brief statement
of the facts accounting for such adjustment, (b) file with the
Rights Agent and with each transfer agent for the Common Stock or
the Preferred Stock a copy of such certificate and (c) mail a
brief summary thereof to each holder of a Right Certificate in
accordance with Section 25 hereof. The Rights Agent shall be
fully protected in relying on any such certificate and on any
adjustment therein and shall not be obligated or responsible for
calculating any adjustment nor shall it be deemed to have
knowledge of any such adjustment unless and until it shall have
received such a certificate.
SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF
ASSETS OR EARNING POWER. In the event, directly or indirectly, at
any time after a Person has become an Acquiring Person, (a) the
Company shall consolidate with, or merge with and into, any other
Person, (b) any Person shall consolidate with the Company, or
merge with and into the Company and the Company shall be the
continuing or surviving corporation of such merger and, in
connection with such merger, all or part of the Common Stock shall
be changed into or exchanged for stock or other securities of any
other Person (or the Company) or cash or any other property, or
(c) the Company
<PAGE>
shall sell or otherwise transfer (or one or more of its
Subsidiaries shall sell or otherwise transfer), in one or more
transactions, assets or earning power aggregating 50% or more of
the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any other Person other than the Company or
one or more of its wholly-owned Subsidiaries, then, and in each
such case, proper provision shall be made so that (i) each holder
of a Right (except as otherwise provided herein) shall thereafter
have the right to receive, upon the exercise thereof at a price
equal to the then current Purchase Price for such Right multiplied
by the number of one one-thousandths of a share of Preferred Stock
for which such Right is then exercisable, in accordance with the
terms of this Agreement and in lieu of shares of Preferred Stock,
such number of shares of Common Stock of such other Person
(including the Company as successor thereto or as the surviving
corporation) as shall equal the result obtained by (A) multiplying
the then current Purchase Price by the number of one
one-thousandths of a share of Preferred Stock for which such Right
is then exercisable and dividing that product by (B) 50% of the
then current per share market price of the Common Stock of such
other Person (determined pursuant to Section 11(d) hereof) on the
date of consummation of such consolidation, merger, sale or
transfer; (ii) the issuer of such Common Stock shall thereafter be
liable for, and shall assume, by virtue of such consolidation,
merger, sale or transfer, all the obligations and duties of the
Company pursuant to this Agreement; (iii) the term "Company" shall
thereafter be deemed to refer to such issuer; and (iv) such issuer
shall take such steps (including, but not limited to, the
reservation of a sufficient number of shares of its Common Stock
in accordance with Section 9 hereof) in connection with such
consummation as may be necessary to assure that the provisions
hereof shall thereafter be applicable, as nearly as reasonably may
be, in relation to the shares of Common Stock thereafter
deliverable upon the exercise of the Rights. The Company shall
not consummate any such consolidation, merger, sale or transfer
unless prior thereto the Company and such issuer shall have
executed and delivered to the Rights Agent a supplemental
agreement so providing. The Company shall not enter into any
transaction of the kind referred to in this Section 13 if at the
time of such transaction there are any rights, warrants,
instruments or securities outstanding or any agreements or
arrangements which, as a result of the consummation of such
transaction, would eliminate or substantially diminish the
benefits intended to be afforded by the Rights. The provisions of
this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers.
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) The Company shall not be required to issue
fractions of Rights or to distribute Right Certificates which
evidence fractional Rights. In lieu of such fractional Rights,
the Company may, at its option, either (i) pay to any registered
holder of a Right Certificate with regard to which any fractional
Right would otherwise be issuable, an amount in cash equal to the
same fraction of the current market value of a whole Right, or
(ii) round up any fractional Right to the next highest whole
number of Rights and issue such next highest whole number of
Rights. For the purposes of this Section 14(a), the current
market value of a whole Right shall be the closing price of the
Rights for the Trading Day immediately prior to the date on which
such fractional Rights would have been otherwise issuable. The
closing price for any day shall be the last sale price, regular
way, or, in case no such sale takes place on such day, the average
of the closing bid and asked prices, regular way, in either case,
as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on
the American Stock Exchange or, if the Rights are not listed or
admitted to trading on the American Stock Exchange, as reported in
the principal consolidated transaction reporting system with
respect to
<PAGE>
securities listed on the principal national securities exchange on
which the Rights are listed or admitted to trading or, if the
Rights are not listed or admitted to trading on any national
securities exchange, the last quoted price or, if not so quoted,
the average of the high bid and low asked prices in the over-the-
counter market, as reported by NASDAQ or such other system then in
use or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the
Rights selected by the Board of Directors of the Company. If on
any such date no such market maker is making a market in the
Rights, the fair value of the Rights on such date as determined in
good faith by the Board of Directors of the Company shall be used.
(b) The Company shall not be required to issue
fractions of shares of Preferred Stock (other than fractions which
are integral multiples of one one-thousandth of a share of
Preferred Stock) upon exercise of the Rights or to distribute
certificates which evidence fractional shares of Preferred Stock
(other than fractions which are integral multiples of one one-
thousandth of a share of Preferred Stock). Fractions of shares of
Preferred Stock in integral multiples of one one-thousandth of a
share of Preferred Stock may, at the election of the Company, be
evidenced by depositary receipts, pursuant to an appropriate
agreement between the Company and a depositary selected by it;
provided that such agreement shall provide that the holders of
such depositary receipts shall have all the rights, privileges and
preferences to which they are entitled as beneficial owners of the
shares of Preferred Stock represented by such depositary receipts.
In lieu of fractional shares of Preferred Stock that are not
integral multiples of one one-thousandth of a share of Preferred
Stock, the Company may, at its option, either (i) pay to any
registered holder of a Right Certificate at the time such Rights
are exercised as herein provided an amount in cash equal to the
same fraction of the current market value of one share of
Preferred Stock, or (ii) round up any fractional share of
Preferred Stock to the next highest integral multiple of one one-
thousandth of a share of Preferred Stock and issue such next
highest integral multiple of one one-thousandth of a share of
Preferred Stock. For the purposes of this Section 14(b), the
current market value of a share of Preferred Stock shall be the
closing price of a share of Preferred Stock (as determined
pursuant to the second sentence of Section 11(d)(i) hereof) for
the Trading Day immediately prior to the date of such exercise.
(c) The holder of a Right by the acceptance of the
Right expressly waives his right to receive any fractional Rights
or any fractional shares upon exercise of a Right (except as
provided above).
SECTION 15. RIGHTS OF ACTION. All rights of action in
respect of this Agreement, excepting the rights of action given to
the Rights Agent under Section 18 hereof, are vested in the
respective registered holders of the Right Certificates (and,
prior to the Distribution Date, the registered holders of the
Common Stock); and any registered holder of any Right Certificate
(or, prior to the Distribution Date, of the Common Stock), without
the consent of the Rights Agent or of the holder of any other
Right Certificate (or, prior to the Distribution Date, of the
Common Stock), may, in his own behalf and for his own benefit,
enforce, and may institute and maintain any suit, action or
proceeding against the Company to enforce, or otherwise act in
respect of, his right to exercise the Rights evidenced by such
Right Certificate in the manner provided in such Right Certificate
and in this Agreement. Without limiting the foregoing or any
remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate
remedy at law for any breach of this Agreement and will be
entitled to specific
<PAGE>
performance of the obligations under, and injunctive relief
against actual or threatened violations of the obligations of any
Person subject to, this Agreement.
SECTION 16. AGREEMENT OF RIGHT HOLDERS. Every holder of
a Right, by accepting the same, consents and agrees with the
Company and the Rights Agent and with every other holder of a
Right that:
(a) prior to the Distribution Date, the Rights will
be transferable only in connection with the transfer of Common
Stock;
(b) after the Distribution Date, the Right
Certificates are transferable only on the registry books of the
Rights Agent if surrendered at the principal office of the Rights
Agent, duly endorsed or accompanied by a proper instrument of
transfer; and
(c) the Company and the Rights Agent may deem and
treat the Person in whose name the Right Certificate (or, prior to
the Distribution Date, the associated Common Stock certificate) is
registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the associated Common Stock
certificate made by anyone other than the Company or the Rights
Agent) for all purposes whatsoever, and neither the Company nor
the Rights Agent shall be affected by any notice to the contrary.
SECTION 17. RIGHT HOLDER NOT DEEMED A STOCKHOLDERS. No
holder, as such, of any Right shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of the Preferred
Stock or any other securities of the Company which may at any time
be issuable on the exercise of the Rights represented thereby, nor
shall anything contained herein or in any Right Certificate, or
Summary of Rights, be construed to confer upon the holder of any
Right, as such, any of the rights of a stockholder of the Company
or any right to vote for the election of directors or upon any
matter submitted to stockholders at any meeting thereof, or to
give or withhold consent to any corporate action, or to receive
notice of meetings or other actions affecting stockholders (except
as provided in Section 25 hereof), or to receive dividends or
subscription rights, or otherwise, until the Right or Rights shall
have been exercised in accordance with the provisions hereof.
SECTION 18. CONCERNING THE RIGHTS AGENT. The Company agrees
to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on
demand of the Rights Agent, its reasonable expenses and counsel
fees and other disbursements incurred in the administration and
execution of this Agreement and the exercise and performance of
its duties hereunder. The Company also agrees to indemnify the
Rights Agent, its directors, officers, employees and agents for,
and to hold it and them harmless against, any loss, liability or
expense incurred without gross negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything done or
omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement or the performance of the Rights
Agent's duties hereunder, including the costs and expenses of
defending against any claim of liability in the premises. The
indemnity provided in this Section 18 shall survive the expiration
of the Rights and the termination of the Agreement.
<PAGE>
The Rights Agent shall be protected and shall incur no
liability for, or in respect of any action taken, suffered or
omitted by it in connection with, its administration of this
Agreement in reliance upon any Right Certificate or certificate
for the shares of Preferred Stock or the shares of Common Stock or
for other securities of the Company, instrument of assignment or
transfer, power of attorney, endorsement, affidavit, letter,
notice, direction, consent, certificate, statement, or other paper
or document believed by it to be genuine and to be signed,
executed and, where necessary, verified or acknowledged, by the
proper Person or Persons, or otherwise upon the advice of counsel
as set forth in Section 20 hereof.
SECTION 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF
RIGHTS AGENT. Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to the stock
transfer or corporate trust powers of the Rights Agent or any
successor Rights Agent, shall be the successor to the Rights Agent
under this Agreement without the execution or filing of any paper
or any further fact on the part of any of the parties hereto;
provided that such corporation would be eligible for appointment
as a successor Rights Agent under the provisions of Section 21
hereof. In case at the time such successor Rights Agent shall
succeed to the agency created by this Agreement, any of the Right
Certificates shall have been countersigned but not delivered, any
such successor Rights Agent may adopt the countersignature of the
predecessor Rights Agent and deliver such Right Certificates so
countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor
Rights Agent may countersign such Right Certificates either in the
name of the predecessor Rights Agent or in the name of the
successor Rights Agent; and in all such cases such Right
Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have
been countersigned but not delivered, the Rights Agent may adopt
the countersignature under its prior name and deliver Right
Certificates so countersigned; and in case at that time any of the
Right Certificates shall not have been countersigned, the Rights
Agent may countersign such Right Certificates either in its prior
name or in its changed name; and in all such cases such Right
Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
SECTION 20. DUTIES OF RIGHTS AGENT. The Rights Agent
undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, by all of which the
Company and the holders of Right Certificates, by their acceptance
thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel
(who may be legal counsel for the Company), and the opinion of
such counsel shall be full and complete authorization and
protection to the Rights Agent as to any action taken or omitted
by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under
this Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter be proved or established by the
Company prior to taking or suffering any action hereunder, such
<PAGE>
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 Chief Executive Officer, the President, any Vice
President, the Treasurer or the Secretary of the Company and
delivered to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken or suffered
in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder to
the Company and any other Person only for its own gross
negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained in
this Agreement or in the Right Certificates (except its
countersignature thereof) or be required to verify the same, but
all such statements and recitals are and shall be deemed to have
been made by the Company only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or the
execution and delivery hereof (except the due execution hereof by
the Rights Agent) or in respect of the validity or execution of
any Right Certificate (except its countersignature thereof); nor
shall it be responsible for any breach by the Company of any
covenant or condition contained in this Agreement or in any Right
Certificate; nor shall it be responsible for any change in the
exercisability of the Rights (including the Rights becoming void
pursuant to Section 11(a)(ii) hereof) or any adjustment in the
terms of the Rights (including the manner, method or amount
thereof) provided for in Section 3, 11, 13, 23 or 24, or the
ascertaining of the existence of facts that would require any such
change or adjustment (except with respect to the exercise of
Rights evidenced by Right Certificates after actual notice that
such change or adjustment is required); nor shall it by any act
hereunder be deemed to make any representation or warranty as to
the authorization or reservation of any shares of Preferred Stock
to be issued pursuant to this Agreement or any Right Certificate
or as to whether any shares of Preferred Stock will, when issued,
be validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform,
execute, acknowledge and deliver or cause to be performed,
executed, acknowledged and delivered all such further and other
acts, instruments and assurances as may reasonably be required by
the Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and
directed to accept instructions with respect to the performance of
its duties hereunder from any one of the Chairman of the Board,
the Chief Executive Officer, the President, any Vice President,
the Secretary or the Treasurer of the Company, and to apply to
such officers for advice or instructions in connection with its
duties, and it shall not be liable for any action taken or
suffered by it in good faith in accordance with instructions of
any such officer or for any delay in acting while waiting for
those instructions. Any application by the Rights Agent for
written instructions from the Company may, at the option of the
Rights Agent, set forth in writing any action proposed to be taken
or omitted by the Rights Agent under this Agreement and the date
on 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
<PAGE>
included in any such application on or after the date specified in
such application (which date shall not be sooner than that date
which is five Business Days after the date any officer of the
Company actually receives such application, unless any such
officer shall have consented in writing to an earlier date)
unless, prior to taking any such action (or the effective date in
the case of an omission), the Rights Agent shall have received
written instructions in response to such application specifying
the action to be taken or omitted.
(h) The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal in
any of the Rights or other securities of the Company or become
pecuniarily interested in any transaction in which the Company may
be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Rights
Agent under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or
for any other legal entity.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents,
and the Rights Agent shall not be answerable or accountable for
any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such act,
default, neglect or misconduct as long as the Rights Agent was not
grossly negligent in the selection thereof.
(j) The Rights Agent undertakes only the express
duties and obligations imposed on it by this Agreement and no
implied duties or obligations shall be read into this Agreement
against the Rights Agent.
(k) Anything in this Agreement to the contrary
notwithstanding, in no event shall the Rights Agent be liable for
special, indirect or consequential loss or damage of any kind
whatsoever (including but not limited to lost profits).
(l) 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.
SECTION 21. CHANGE OF RIGHTS AGENT. The Rights Agent or
any successor Rights Agent may resign and be discharged from its
duties under this Agreement upon 30-days' notice in writing mailed
to the Company and to each transfer agent of the Common Stock or
Preferred Stock by registered or certified mail, and to the
holders of the Right Certificates by first-class mail. The
Company may remove the Rights Agent or any successor Rights Agent
upon 30-days' notice in writing, mailed to the Rights Agent or
successor Rights Agent, as the case may be, and to each transfer
agent of the Common Stock or Preferred Stock by registered or
certified mail, and to the holders of the Right Certificates by
first- class mail. If the Rights Agent shall resign or be removed
or shall otherwise become incapable of acting, the Company shall
appoint a successor to the Rights Agent. If the Company shall
fail to make such appointment within a period of 30 days after
giving notice of such removal or after it has been notified in
writing of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the
<PAGE>
holder of a Right Certificate (who shall, with such notice, submit
his Right Certificate for inspection by the Company), then the
registered holder of any Right Certificate may apply to any court
of competent jurisdiction for the appointment of a new Rights
Agent. Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be a corporation organized and
doing business under the laws of the United States or of the State
of Maryland (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 Maryland), in good standing, having an
office in the State of Maryland or the State of New York, which is
authorized under such laws to exercise corporate trust or stock
transfer powers and is subject to supervision or examination by
federal or state authority and which has at the time of its
appointment as Rights Agent a combined capital and surplus of at
least $50 million. After appointment, the successor Rights Agent
shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights
Agent without further act or deed; but the predecessor Rights
Agent shall deliver and transfer to the successor Rights Agent any
property at the time held by it hereunder, and execute and deliver
any further assurance, conveyance, act or deed necessary for the
purpose. Not later than the effective date of any such
appointment, the Company shall file notice thereof in writing with
the predecessor Rights Agent and each transfer agent of the Common
Stock or Preferred Stock, and mail a notice thereof in writing to
the registered holders of the Right Certificates. Failure to give
any notice provided for in this Section 21, however, or any defect
therein, shall not affect the legality or validity of the
resignation or removal of the Rights Agent or the appointment of
the successor Rights Agent, as the case may be.
SECTION 22. ISSUANCE OF NEW RIGHT CERTIFICATES.
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new
Right Certificates evidencing Rights in such form as may be
approved by its Board of Directors to reflect any adjustment or
change in the Purchase Price and the number or kind or class of
shares or other securities or property purchasable under the Right
Certificates made in accordance with the provisions of this
Agreement.
SECTION 23. REDEMPTION.
(a) The Board of Directors of the Company may, at
its option, at any time prior to such time as any Person becomes
an Acquiring Person, redeem all but not less than all the then
outstanding Rights at a redemption price, at the option of the
Board of Directors of the Company, of $.001 per Right or for one
one-thousandth (1/1000) of a share of Class A Common per Series A
Right and one one-thousandth (1/1000) of a share of Class B Common
per Series B Right, as such redemption price is 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"). The
redemption of the Rights by the Board of Directors of the Company
may be made effective at such time, on such basis and with such
conditions as the Board of Directors of the Company, in its sole
discretion, may establish. For the purposes of this Section 23
and anything in this Agreement to the contrary notwithstanding,
the Company may issue fractions of either Class of Common Stock
and distribute certificates which evidence fractional shares of
Common Stock.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the redemption of the Rights
pursuant to paragraph (a) of this Section 23, and without any
<PAGE>
further action and without any notice, the right to exercise the
Rights will terminate and the only right thereafter of the holders
of Rights shall be to receive the Redemption Price. The Company
shall promptly give public notice of any such redemption;
provided, however, that the failure to give, or any defect in, any
such notice shall not affect the validity of such redemption.
Within 10 days after such action of the Board of Directors of the
Company ordering the redemption of the Rights, the Company shall
mail a notice of redemption to all the holders of the then
outstanding Rights at their last addresses as they appear upon the
registry books of the Rights Agent or, prior to the Distribution
Date, on the registry books of the transfer agent for the Common
Stock. Any notice which is mailed in the manner herein provided
shall be deemed given, whether or not the holder receives the
notice. Each such notice of redemption will state the method by
which the payment of the Redemption Price will be made. Neither
the Company nor any of its Affiliates or Associates may redeem,
acquire or purchase for value any Rights at any time in any manner
other than that specifically set forth in this Section 23 or in
Section 24 hereof, and other than in connection with the purchase
of shares of Common Stock prior to the Distribution Date.
SECTION 24. EXCHANGE.
(a) The Board of Directors of the Company may, at
its option, at any time after any Person becomes an Acquiring
Person, exchange all or part of the then outstanding and
exercisable Series A Rights (which shall not include Series A
Rights that have become void pursuant to the provisions of Section
3(a) or Section 11(a)(ii) hereof) for Class A Common at an
exchange ratio of one Class A Common share per Series A Right
and/or the then outstanding and exercisable Series B Rights (which
shall not include Series B Rights that have become void pursuant
to the provisions of Section 3(a) or Section 11(a)(ii) hereof) for
Class B Common at an exchange ratio of one Class B Common share
per Series B Right, appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the
date hereof (such exchange ratio being hereinafter referred to as
the "Exchange Ratio"). Notwithstanding the foregoing, the Board
of Directors of the Company shall not be empowered to effect such
exchange at any time after any Person (other than the Company, any
Person having beneficial ownership of 50% or more of either or
both Classes of the Common Stock outstanding on the Record Date,
any Subsidiary of the Company, any employee benefit plan of the
Company or any such Subsidiary, or any entity holding shares of
Common Stock for or pursuant to the terms of any such plan),
together with all Affiliates and Associates of such Person,
becomes the Beneficial Owner of 50% or more of either Class of
Common Stock then outstanding.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the exchange of any Rights
pursuant to paragraph (a) of this Section 24 and without any
further action and without any notice, the right to exercise such
Rights shall terminate and the only right thereafter of a holder
of such Series A Rights and/or Series B Rights shall be to receive
that number of Class A Common shares and/or Class B Common shares
equal to the number of such Rights held by such holder multiplied
by the Exchange Ratio. The Company shall promptly give public
notice of any such exchange; provided, however, that the failure
to give, or any defect in, such notice shall not affect the
validity of such exchange. The Company 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 notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives
the
<PAGE>
notice. Each such notice of exchange will state the method by
which the exchange of the Class A Common shares for Series A
Rights and the Class B Common shares for Series B 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 3(a)
or Section 11(a)(ii) hereof) held by each holder of Rights.
(c) In the event that there shall not be sufficient
Class A Common shares authorized but unissued to permit any
exchange of Series A Rights or Class B Common shares authorized
but unissued to permit any exchange of Series B Rights, each as
contemplated in accordance with this Section 24, the Company shall
take all such action as may be necessary to authorize additional
Class A Common shares and/or Class B Common shares, as the case
may be, for issuance upon exchange of the Rights. In the event
the Company shall, after good faith effort, be unable to take all
such action as may be necessary to authorize such additional Class
A Common shares and/or Class B Common shares, the Company shall
substitute, for each Class A Common share and/or Class B Common
share that would otherwise be issuable upon exchange of a Right, a
number of shares of Preferred Stock (of like series) or fraction
thereof such that the current per share market price of one share
of Series A Preferred multiplied by such number or fraction is
equal to the current per share market price of one Class A Common
share and one share of Series B Preferred multiplied by such
number or fraction is equal to the current per share market price
of one Class B Common share as of the date of issuance of such
shares of Preferred Stock or fraction thereof.
(d) The Company shall not be required to issue
fractions of either Class of Common Stock or to distribute
certificates which evidence fractional shares of Common Stock. In
lieu of such fractional shares of Common Stock, the Company shall,
at its option, (i) pay to the registered holder of a Right
Certificate with regard to which any fractional share of Common
Stock would otherwise be issuable an amount in cash equal to the
same fraction of the current market value of a whole share of
Class A Common or Class B Common, as the case may be, or (ii)
round up any fractional share of Common Stock to the next highest
whole number of shares of Common Stock and issue such next
highest whole number of shares of Common Stock. For the purposes
of this paragraph (d), the current market value of a whole Class A
Common share and a whole Class B Common share shall be the closing
price of such share (as determined pursuant to the second sentence
of Section 11(d)(i) hereof) for the Trading Day immediately prior
to the date of exchange pursuant to this Section 24.
SECTION 25. NOTICE OF CERTAIN EVENTS.
(a) In case the Company shall propose (i) to pay any
dividend payable in stock of any class to the holders of its
Preferred Stock or to make any other distribution to the holders
of its Preferred Stock (other than a regular quarterly cash
dividend), (ii) to offer to the holders of its Preferred Stock
rights or warrants to subscribe for or to purchase any additional
shares of Preferred Stock or shares of stock of any class or any
other securities, rights or options, (iii) to effect any
reclassification of its Preferred Stock (other than a
reclassification involving only the subdivision of outstanding
Series A Preferred and/or Series B Preferred), (iv) to effect any
consolidation or merger into or with, or to effect any sale or
other transfer (or to permit one or more of its Subsidiaries to
effect any sale or other
<PAGE>
transfer), in one or more transactions, of 50% or more of the
assets or earning power of the Company and its Subsidiaries (taken
as a whole) to, any other Person, (v) to effect the liquidation,
dissolution or winding up of the Company, or (vi) to declare or
pay any dividend on the Class A Common shares payable in Class A
Common shares or on the Class B Common shares payable in Class B
Common shares or to effect a subdivision, combination or
consolidation of either Class of Common Stock (by reclassification
or otherwise than by payment of dividends in shares of Common
Stock), then, in each such case, the Company shall give to each
holder of a Right Certificate, in accordance with Section 26
hereof, a notice of such proposed action, which shall specify the
record date for the purposes of such stock dividend, or
distribution of rights or warrants, or the date on which such
reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution, or winding up is to take place and the
date of participation therein by the holders of such Common Stock
and/or Preferred Stock, if any such date is to be fixed, and such
notice shall be so given in the case of any action covered by
clause (i) or (ii) above at least 10 days prior to the record date
for determining holders of Preferred Stock for purposes of such
action, and in the case of any such other action, at least 10 days
prior to the date of the taking of such proposed action or the
date of participation therein by the holders of the Common Stock
and/or Preferred Stock, whichever shall be the earlier.
(b) In case the event set forth in Section 11(a)(ii)
hereof shall occur, then the Company shall as soon as practicable
thereafter give to each holder of a Right Certificate, in
accordance with Section 26 hereof, a notice of the occurrence of
such event, which notice shall describe such event and the
consequences of such event to holders of Rights under Section
11(a)(ii) hereof.
SECTION 26, NOTICES. Notices or demands authorized by
this Agreement to be given or made by the Rights Agent or by the
holder of any Right Certificate to or on the Company shall be
sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with
the Rights Agent) as follows:
Crown Central Petroleum Corporation
P.O. Box 1168
Baltimore, Maryland 21203
Attention: Thomas L. Owsley, Senior Vice President-- Legal
Subject to the provisions of Section 21 hereof, any notice or
demand authorized by this Agreement to be given or made by the
Company or by the holder of any Right Certificate to or on the
Rights Agent shall be sufficiently given or made if sent by first-
class mail, postage prepaid, addressed (until another address is
filed in writing with the Company) as follows:
First Union National Bank
1525 West W. T. Harris Boulevard, 3C3
Charlotte, North Carolina 23262-1153
Attention: Shareholder Services Group
Notices or demands authorized by this Agreement to be given or
made by the Company or the Rights Agent to the holder of any Right
Certificate shall be sufficiently given or made if sent by first-
<PAGE>
class mail, postage prepaid, addressed to such holder at the
address of such holder as shown on the registry books of the
Company.
SECTION 27. SUPPLEMENTS AND AMENDMENTS. The Company may
from time to time supplement or amend this Agreement without the
approval of any holders of Right Certificates in order to cure any
ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with any other provisions
herein, or to make any other provisions with respect to the Rights
which the Company may deem necessary or desirable, any such
supplement or amendment to be evidenced by a writing signed by the
Company and the Rights Agent; provided, however, that from and
after such time as any Person becomes an Acquiring Person, this
Agreement shall not be amended in any manner which would adversely
affect the interests of the holders of Rights. Notwithstanding
anything contained in this Agreement to the contrary, no
supplement or amendment that changes the rights or duties of the
Rights Agent under this Agreement in any material respect shall be
effective without the consent of the Rights Agent. Upon the
delivery of a certificate from an officer of the Company which
states that the proposed supplement or amendment is in compliance
with the terms of this Section 26, the Rights Agent shall promptly
execute such supplement or amendment.
SECTION 28, SUCCESSORS. All the covenants and provisions
of this Agreement by or for the benefit of the Company or the
Rights Agent shall bind and inure to the benefit of their
respective successors and assigns hereunder.
SECTION 29. BENEFITS OF THIS AGREEMENT. Nothing in
this Agreement shall be construed to give to any Person other than
the Company, the Rights Agent and the registered holders of the
Right Certificates (and, prior to the Distribution Date, the
registered holders of Company Common Stock) any legal or equitable
right, remedy or claim under this Agreement; but this Agreement
shall be for the sole and exclusive benefit of the Company, the
Rights Agent and the registered holders of the Right Certificates
(and, prior to the Distribution Date, the Company Common Stock).
SECTION 30. SEVERABILITY. If any term, provision,
covenant or restriction of this Agreement is held by a court of
competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants
and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
SECTION 31. GOVERNING LAW. This Agreement and each
Right Certificate issued hereunder shall be deemed to be a
contract made under the laws of the State of Maryland and for all
purposes shall be governed by and construed in accordance with the
laws of State of Maryland applicable to contracts to be made and
performed entirely within such State.
SECTION 32. 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.
<PAGE>
SECTION 33. 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.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and attested, all as of the day and
year first above written.
ATTEST: FIRST UNION NATIONAL BANK,
as Rights Agent
/s/ Edmund Wiener By:/s/ James M. Clark
- ----------------------- ---------------------
Name: James M. Clark
Title: Vice President
ATTEST: CROWN CENTRAL PETROLEUM
CORPORATION
/s/ Dolores Rawlings By:/s/ John E. Wheeler, Jr.
- --------------------------- -------------------------
Name: John E. Wheeler, Jr.
Title: Executive Vice President-
Chief Financial Officer
<PAGE>
Exhibit A-
1
Form of Right Certificate
(Series A Preferred)
Certificate No. R-
_______ Rights
NOT EXERCISABLE AFTER FEBRUARY 14, 2001 OR EARLIER IF REDEMPTION
OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE
OPTION OF THE BOARD OF DIRECTORS, AT $.001 PER RIGHT OR FOR ONE
ONE-THOUSANDTH (1/1000) OF ONE SHARE OF CLASS A COMMON PER RIGHT
AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.
Right Certificate For Series A Preferred
CROWN CENTRAL PETROLEUM CORPORATION
This certifies that _________________, or registered assigns,
is the registered owner of the number of Series A 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 February 1, 2000 (the "Rights Agreement"), between Crown
Central Petroleum Corporation, a Maryland corporation (the
"Company"), and First Union National Bank (the "Rights Agent"), to
purchase from the Company at any time after the Distribution Date
(as such term is defined in the Rights Agreement) and prior to
5:00 P.M., Baltimore, Maryland time, on February 14, 2001, at the
principal office of the Rights Agent, or at the office of its
successor as Rights Agent, one one-thousandth of a fully paid non-
assessable share of Series A Junior Participating Preferred Stock,
no par value, of the Company, (the "Series A Preferred Stock") at
a purchase price of $16 (subject to adjustment as provided in the
Rights Agreement) per one one-thousandth of a share of Series A
Preferred Stock (the "Purchase Price"), upon presentation and
surrender of this Right Certificate with the Form of Election to
Purchase duly executed. The number of Series A Rights evidenced
by this Right Certificate (and the number of one one-thousandths
of a share of Series A Preferred Stock which may be purchased upon
exercise hereof) set forth above, and the Purchase Price set forth
above, are the number and Purchase Price as of February 15, 2000,
based on the shares of Series A Preferred Stock as constituted at
such date. As provided in the Rights Agreement, the Purchase
Price and the number of one one-thousandths of a share of Series A
Preferred Stock which may be purchased upon the exercise of the
Series A Rights evidenced by this Right Certificate are subject to
modification and adjustment upon the happening of certain events.
This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities
hereunder of the Rights Agent, the Company and the holders of the
Right Certificates. Copies of the Rights Agreement are on file at
the principal executive offices of the Company and the principal
office of the Rights Agent.
<PAGE>
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 shares of Series
A Preferred Stock as the Rights evidenced by the Right Certificate
or Right Certificates surrendered shall have entitled such holder
to purchase. If this Right Certificate shall be exercised in
part, the holder shall be entitled to receive upon surrender
hereof another Right Certificate or Right Certificates for the
number of whole Series A Rights not exercised.
Subject to the provisions of the Rights Agreement, the Series
A Rights evidenced by this Right Certificate (i) may be redeemed
by the Company at a redemption price, at the option of the Board
of Directors, of $.001 per Right or for one one-thousandth
(1/1000) of one share of Class A Common per Right, or (ii) may be
exchanged in whole or in part for shares of Series A Preferred
Stock or shares of the Company's Class A Common, par value $5.00
per share.
No fractional shares of Series A Preferred Stock will be
issued upon the exercise of any Right or Rights evidenced hereby
(other than fractions which are integral multiples of one
one-thousandth of a share of Series A Preferred Stock, which may,
at the election of the Company, be evidenced by depositary
receipts). In lieu thereof, at the option of the Company, either
a cash payment will be made or such fractional share (other than
fractions which are integral multiples of one one-thousandth of a
share of Series A Preferred Stock) will be rounded up to the next
integral multiple of one one-thousandth of a share of Series A
Preferred Stock, as provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote
or receive dividends or be deemed for any purpose the holder of
shares of the Series A Preferred Stock or of any other securities
of the Company which may at any time be issuable on the exercise
hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any
of the rights of a stockholder of the Company or any right to vote
for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings
or other actions affecting stockholders (except as provided in the
Rights Agreement), or to receive dividends or subscription rights,
or otherwise, until the Right or Rights evidenced by this Right
Certificate shall have been exercised as provided in the Rights
Agreement.
This Right Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights
Agent.
<PAGE>
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal.
Dated as of ______________, ____.
- ------------------------------- By:--------------------
Name:
Title:
ATTEST: CROWN CENTRAL PETROLEUM
CORPORATION
- -------------------------------- By:--------------------
Name:
Title:
<PAGE>
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to
transfer the Right Certificate.)
FOR VALUE RECEIVED, -----------------------------------
hereby sells, assigns and transfers unto --------------- (Please
print name and address of transferee) this Right Certificate,
together with all right, title and interest therein, and does
hereby irrevocably constitute and appoint ----------------
Attorney, to transfer the within Right Certificate on the books of
Crown Central Petroleum and its transfer agent, 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 or
trust company having an office or correspondent in the United
States.
The undersigned hereby certifies that the Series A Rights
evidenced by this Right Certificate are not beneficially owned by
an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement).
Signature
-------------------------
------------------------------
<PAGE>
Form of Reverse Side of Right Certificate - continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise Series A Rights
represented by the Right Certificate.)
To: Crown Central Petroleum Corporation
The undersigned hereby irrevocably elects to exercise -------
Series A Rights represented by this Right Certificate to purchase
shares of the Series A Preferred Stock issuable upon the exercise
of such Series A Rights and requests that certificates for such
shares of Series A Preferred Stock be issued in the name of:
Please insert social security
or other identifying number
(Please print name and address)
If such number of Series A Rights shall not be all the Series A
Rights evidenced by this Right Certificate, a new Right
Certificate for the balance remaining of such Series A Rights
shall be registered in the name of and delivered to:
Please insert social security
or other identifying number
(Please print name and address)
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 or trust company
having an office or correspondent in the United States.
---------------------------------------------
<PAGE>
Form of Reverse Side of Right Certificate - continued
The undersigned hereby certifies that the Series A
Rights evidenced by this Right Certificate are not beneficially
owned by an Acquiring Person or an Affiliate or Associate thereof
(as defined in the Rights Agreement).
Signature
--------------------------
--------------------------
---------------------------
NOTICE
The signature in the Form of Assignment or Form of Election
to Purchase, as the case may be, must conform to the name as
written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above in the Form of
Assignment or the Form of Election to Purchase, as the case may
be, is not completed, the Company and the Rights Agent will deem
the beneficial owner of the Series A Rights evidenced by this
Right Certificate to be an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.
<PAGE>
Exhibit A-2
Form of Right Certificate
(Series B Preferred)
Certificate No. R-
------- Rights
NOT EXERCISABLE AFTER FEBRUARY 14, 2001 OR EARLIER IF REDEMPTION
OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE
OPTION OF THE BOARD OF DIRECTORS, AT $.001 PER RIGHT OR FOR ONE
ONE-THOUSANDTH (1/1000) OF ONE SHARE OF CLASS B COMMON PER RIGHT
AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.
Right Certificate For Series B Preferred
CROWN CENTRAL PETROLEUM CORPORATION
This certifies that -------------, or registered assigns, is
the registered owner of the number of Series B 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 February 1, 2000 (the "Rights Agreement"), between Crown
Central Petroleum Corporation, a Maryland corporation (the
"Company"), and First Union National Bank (the "Rights Agent"), to
purchase from the Company at any time after the Distribution Date
(as such term is defined in the Rights Agreement) and prior to
5:00 P.M., Baltimore, Maryland time, on February 14, 2001, at the
principal office of the Rights Agent, or at the office of its
successor as Rights Agent, one one-thousandth of a fully paid non-
assessable share of Series B Junior Participating Preferred Stock,
no par value, of the Company, (the "Series B Preferred Stock") at
a purchase price of $16 (subject to adjustment as provided in the
Rights Agreement) per one one-thousandth of a share of Series B
Preferred Stock (the "Purchase Price"), upon presentation and
surrender of this Right Certificate with the Form of Election to
Purchase duly executed. The number of Series B Rights evidenced
by this Right Certificate (and the number of one one-thousandths
of a share of Series B Preferred Stock which may be purchased upon
exercise hereof) set forth above, and the Purchase Price set forth
above, are the number and Purchase Price as of February 15, 2000,
based on the shares of Series B Preferred Stock as constituted at
such date. As provided in the Rights Agreement, the Purchase
Price and the number of one one-thousandths of a share of Series B
Preferred Stock which may be purchased upon the exercise of the
Series B Rights evidenced by this Right Certificate are subject to
modification and adjustment upon the happening of certain events.
This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities
hereunder of the Rights Agent, the Company and the holders of the
Right Certificates. Copies of the Rights Agreement are on file at
the principal executive offices of the Company and the principal
office of the Rights Agent.
<PAGE>
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 shares of Series
B Preferred Stock as the Rights evidenced by the Right Certificate
or Right Certificates surrendered shall have entitled such holder
to purchase. If this Right Certificate shall be exercised in
part, the holder shall be entitled to receive upon surrender
hereof another Right Certificate or Right Certificates for the
number of whole Series B Rights not exercised.
Subject to the provisions of the Rights Agreement, the Series
B Rights evidenced by this Right Certificate (i) may be redeemed
by the Company at a redemption price, at the option of the Board
of Directors, of $.001 per Right or for one one-thousandth
(1/1000) of one share of Class B Common per Right, or (ii) may be
exchanged in whole or in part for shares of Series B Preferred
Stock or shares of the Company's Class B Common, par value $5.00
per share.
No fractional shares of Series B Preferred Stock will be
issued upon the exercise of any Right or Rights evidenced hereby,
other than fractions which are integral multiples of one one-
thousandth of a share of Series B Preferred Stock, which may, at
the election of the Company, be evidenced by depositary receipts.
In lieu thereof, at the option of the Company, either a cash
payment will be made or such fractional share (other than
fractions which are integral multiples of one one-thousandth of a
share of Series B Preferred Stock) will be rounded up to the next
integral multiple of one one-thousandth of a share of Series B
Preferred Stock, as provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote
or receive dividends or be deemed for any purpose the holder of
shares of the Series B Preferred Stock or of any other securities
of the Company which may at any time be issuable on the exercise
hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any
of the rights of a stockholder of the Company or any right to vote
for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings
or other actions affecting stockholders (except as provided in the
Rights Agreement), or to receive dividends or subscription rights,
or otherwise, until the Right or Rights evidenced by this Right
Certificate shall have been exercised as provided in the Rights
Agreement.
This Right Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights
Agent.
<PAGE>
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal.
Dated as of ----------------,-------.
- -------------------------------By:-------------------------
Name:
Title:
ATTEST: CROWN CENTRAL PETROLEUM
CORPORATION
- -------------------------------By:-------------------------
Name:
Title:
<PAGE>
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to
transfer the Right Certificate.)
FOR VALUE RECEIVED, ------------------------------- hereby sells,
assigns and transfers unto --------------------------- (Please
print name and address of transferee) this Right Certificate,
together with all right, title and interest therein, and does
hereby irrevocably constitute and appoint ------------------------
- ------- Attorney, to transfer the within Right Certificate on the
books of Crown Central Petroleum Corporation and its transfer
agent, 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 or
trust company having an office or correspondent in the United
States.
The undersigned hereby certifies that the Series B Rights
evidenced by this Right Certificate are not beneficially owned by
an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement).
Signature
--------------------
-------------------------------
<PAGE>
Form of Reverse Side of Right Certificate - continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise Series B Rights
represented by the Right Certificate.)
To: Crown Central Petroleum Corporation
The undersigned hereby irrevocably elects to exercise-----
Series B Rights represented by this Right Certificate to purchase
shares of the Series B Preferred Stock issuable upon the exercise
of such Series B Rights and requests that certificates for such
Series B Preferred Stock be issued in the name of:
Please insert social security
or other identifying number
(Please print name and address)
If such number of Series B Rights shall not be all the Series B
Rights evidenced by this Right Certificate, a new Right
Certificate for the balance remaining of such Series B Rights
shall be registered in the name of and delivered to:
Please insert social security
or other identifying number
(Please print name and address)
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 or trust company
having an office or correspondent in the United States.
-----------------------
<PAGE>
Form of Reverse Side of Right Certificate - continued
The undersigned hereby certifies that the Series B Rights
evidenced by this Right Certificate are not beneficially owned by
an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement).
Signature
----------------------
----------------------------
NOTICE
The signature in the Form of Assignment or Form of Election
to Purchase, as the case may be, must conform to the name as
written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above in the Form of
Assignment or the Form of Election to Purchase, as the case may
be, is not completed, the Company and the Rights Agent will deem
the beneficial owner of the Series B Rights evidenced by this
Right Certificate to be an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored
<PAGE>
Exhibit B
SUMMARY OF RIGHTS TO PURCHASE PREFERRED STOCK
On February 1, 2000, the Board of Directors of Crown Central
Petroleum Corporation (the "Company") declared a dividend of one
Series A preferred share purchase right (a "Series A Right") for
each outstanding share of Class A common stock, par value $5.00
per share, of the Company (the "Class A Common") and one Series B
preferred share purchase right (a "Series B Right" and together
with the Series A Rights, collectively, the "Rights") for each
outstanding share of Class B common stock, par value $5.00 per
share, of the Company (the "Class B Common" and together with the
Class A Common, collectively, the "Common Stock"). The dividend
is payable on February 15, 2000 (the "Record Date") to the
stockholders of record on that date. Each Series A Right entitles
the registered holder to purchase from the Company one
one-thousandth of a share of Series A Junior Participating
Preferred Stock of the Company, no par value (the "Series A
Preferred Stock") at a price of $16 (subject to adjustment as
provided in the Rights Agreement) per one one-thousandth of a
share of Series A Preferred Stock (the "Series A Purchase Price").
Each Series B Right entitles the registered holder to purchase
from the Company one one-thousandth of a share of Series B Junior
Participating Preferred Stock of the Company, no par value (the
"Series B Preferred Stock" and together with the Series A
Preferred Stock, collectively, the "Preferred Stock") at a price
of $16 (subject to adjustment as provided in the Rights Agreement)
per one one-thousandth of a share of Series B Preferred Stock (the
"Series B Purchase Price" and together with the Series A Purchase
Price, collectively, the "Purchase Price"). The description and
terms of the Series A Rights and the Series B Rights are set forth
in a Rights Agreement (the "Rights Agreement") between the Company
and First Union National Bank, as Rights Agent (the "Rights
Agent").
Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated
persons (an "Acquiring Person") have acquired, with respect to
either class of Common Stock, beneficial ownership of (1) a number
of shares of either class of Common Stock that exceeds 15% of the
total number of then outstanding shares of such class of Common
Stock (for any person who on the date of the Rights Agreement
beneficially owns a number of shares that is less than 14% of the
total number of then outstanding shares of a class of Common
Stock), or (2) the number of shares of either class of Common
Stock as disclosed on such person's Schedule 13D or 13G, as the
case may be, most recently filed with the Securities and Exchange
Commission prior to the date of the Rights Agreement, plus an
additional number of shares of such class of Common Stock that
exceeds 1% of the total number of shares of such class of Common
Stock outstanding the date of the Rights Agreement (for any person
who on the date of the Rights Agreement beneficially owns a number
of shares that is equal to or exceeds 14% of the total number of
outstanding shares of either class of Common Stock) (either (1) or
(2) above is hereinafter referred to as a "Substantial Block" of
Common Stock), or (ii) 10 business days (or such later date as may
be determined by action of the Board of Directors of the Company
prior to such time as any person or group of affiliated persons
becomes an Acquiring Person) following the commencement of, or
announcement of an intention to make, a tender offer or exchange
offer the consummation of which may result in the beneficial
ownership by a person or group of a Substantial Block (the earlier
of such dates being the "Distribution Date"), the Rights will be
evidenced, with respect to any of the Common Stock outstanding as
of the
<PAGE>
Record Date, by such Common Stock share certificate with a copy of
this Summary of Rights attached thereto.
The Rights Agreement provides that, until the Distribution
Date (or earlier redemption or expiration of the Rights), the
Rights will be transferred with and only with the shares of Common
Stock. Until the Distribution Date (or earlier redemption or
expiration of the Rights), upon transfer or new issuance of shares
of Common Stock, new Common Stock share certificates issued after
the Record Date will contain a notation incorporating the Rights
Agreement by reference. Until the Distribution Date (or earlier
redemption or expiration of the Rights), the transfer of any
shares of Common Stock outstanding as of the Record Date,
including surrender for transfer of any certificates therefor 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 such shares of Common Stock. As soon as
practicable following the Distribution Date, separate certificates
evidencing the Rights ("Right Certificates") will be mailed to
holders of record of shares of the Common Stock as of the close of
business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights associated with shares
of Common Stock.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on February 14, 2001 (the "Final Expiration
Date"), unless the Rights are earlier exchanged by the Company, as
described below.
The Purchase Price payable, and the number of shares of
Preferred Stock or other securities or property issuable, upon
exercise of the Rights are subject to adjustment from time to time
to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred
Stock; (ii) upon the grant to holders of shares of Preferred Stock
of certain rights or warrants to subscribe for or purchase shares
of Preferred Stock at a price, or securities convertible into
shares of Preferred Stock with a conversion price, less than the
then-current per share market price of the Preferred Stock; or
(iii) upon the distribution to holders of shares of the Preferred
Stock of evidences of indebtedness or assets (excluding regular
periodic cash dividends paid out of earnings or retained earnings
or dividends payable in Preferred Stock) or of subscription rights
or warrants (other than those referred to above).
The number of outstanding Rights and the number of one one-
thousandths of a share of Preferred Stock issuable upon exercise
of each Right are also subject to adjustment in the event of a
stock split of the Common Stock or a stock dividend on the Common
Stock payable in shares of Common Stock or subdivisions,
consolidations or combinations of the Common Stock occurring, in
any such case, prior to the Distribution Date.
Shares of Preferred Stock purchasable upon exercise of the
Rights will be nonredeemable. Each share of Preferred Stock will
have a minimum preferential quarterly dividend in an amount per
share equal to the greater of (i) $1.00 or (ii) subject to certain
adjustments, 1000 times the aggregate per share amount of all cash
dividends, and 1000 times the aggregate per share amount (payable
in kind) of all non-cash dividends or other distributions other
than a dividend payable in Common Stock or a subdivision of the
outstanding Common Stock (by reclassification or otherwise),
declared on the Common Stock, since the date of the immediately
preceding quarterly dividend payment or, with respect to the date
of
<PAGE>
the first quarterly dividend payment, since the first issuance of
any share or fraction of a share of Preferred Stock. In the event
of liquidation, the holders of shares of Preferred Stock will
receive a preferential liquidation payment equal to the greater of
$1.00 per share, plus accrued and unpaid dividends and
distributions thereon, or 1000 times the payment made per
corresponding share of Common Stock.
Each share of Series A Preferred Stock will have 1000 votes and
each share of Series B Preferred Stock will have 100 votes, voting
together with the shares of Common Stock on all matters on which
the shares of Class A Common and the shares of Class B Common vote
together and separately for the election of Directors of the
Company, to the extent the Preferred Stock is permitted to vote
for the election or removal of Directors. If, on the record date
for determining stockholders entitled to vote for the election or
removal of Directors, at least a certain threshold number of
shares of Series A Preferred Stock is issued and outstanding (as
set forth in the Articles Supplementary filed with the Maryland
State Department of Assessments and Taxation designating the
Series A Preferred Stock and the Series B Preferred Stock), the
holders of Series A Preferred Stock will have the ability to elect
one more director than the number of directors which the Class A
Common Stock is then entitled to elect and if, on the record date
for determining stockholders entitled to vote for the election or
removal of Directors, at least a certain threshold number of
shares of Series B Preferred Stock is issued and outstanding (as
set forth in the Articles Supplementary filed with the Maryland
State Department of Assessments and Taxation designating the
Series A Preferred Stock and the Series B Preferred Stock), the
holders of Series B Preferred holders will have the ability to
elect two directors.
Finally, in the event of any merger, consolidation or other
transaction in which shares of Common Stock are exchanged, each
share of Preferred Stock will be entitled to receive 1000 times
the amount received per share of Common Stock of like class.
These rights are protected by customary antidilution provisions.
Because of the nature of the dividend, liquidation and voting
rights of the Preferred Stock, the value of one one-thousandth
interest in a share of Series A Preferred Stock purchasable upon
exercise of each Series A Right should approximate the value of
one share of Series A Common Stock and the value of one one-
thousandth interest in a share of Series B Preferred Stock
purchasable upon exercise of each Series B Right should
approximate the value of one share of Series B Common Stock.
In the event that the Company is acquired in a merger or
other business combination transaction or 50% or more of its
consolidated assets or earning power are sold after a person or
group has become an Acquiring Person, proper provision will be
made so that each holder of a Right will thereafter have the right
to receive, upon the exercise thereof at the then current exercise
price of the Right, that number of shares of common stock of the
acquiring company which at the time of such transaction will have
a market value of two times the exercise price of the Right. In
the event that any person or group of affiliated or associated
persons becomes an Acquiring Person, proper provision shall be
made so that each holder of a Right, other than Rights
beneficially owned by the Acquiring Person (which will thereafter
be void), will thereafter have the right to receive upon exercise
that number of shares of Common Stock having a market value of two
times the exercise price of the Right.
At any time after any person or group becomes an Acquiring
Person and prior to the acquisition by such person or group of 50%
or more of the outstanding shares of Common Stock, the Board of
Directors of the Company may exchange the Rights (other than
Rights owned by such person or group which will have become void),
in whole or in part, at an exchange ratio of one share of Common
Stock, or one one-thousandth of a share of Preferred Stock (or of
a share of a class or series of the Company's preferred stock
having equivalent rights, preferences and privileges), per Right
(subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price. No fractional
shares of Preferred Stock will be issued (other than fractions
which are integral multiples of one one-thousandth of a share of
Preferred Stock, which may, at the election of the Company, be
evidenced by depositary receipts) and, in lieu thereof, an
adjustment in cash will be made based on the market price of the
Preferred Stock on the last trading day prior to the date of
exercise.
At any time prior to the acquisition by a person or group of
affiliated or associated persons of beneficial ownership, with
respect to either class of Common Stock, of (1) a number of shares
of Common Stock that exceeds 15% of the total number of then
outstanding shares of such class of Common Stock (for any person
who on the date of the Rights Agreement beneficially owns a number
of shares that is less than 14% of the total number of then
outstanding shares of a class of Common Stock), or (2) the number
of shares of Common Stock as disclosed on such person's Schedule
13D or 13G, as the case may be, most recently filed with the
Securities and Exchange Commission prior to the date of the Rights
Agreement, plus an additional number of shares of such class of
Common Stock that exceeds 1% of the total number of shares of such
class of Common Stock outstanding the date of the Rights Agreement
(for any person who on the date of the Rights Agreement
beneficially owns a number of shares that is equal to or exceeds
14% of the total number of outstanding shares of either class of
Common Stock), the Board of Directors of the Company may redeem
the Rights in whole, but not in part, at the option of the Board
of Directors, at a price (the "Redemption Price") of $.001 per
Right or for one one-thousandth (1/1000) of one share of Class A
Common per Series A Right and one one-thousandth (1/1000) of one
share of Class B Common per Series B Right. The redemption of the
Rights may be made effective at such time on such basis with such
conditions as the Board of Directors in its sole discretion may
establish. Immediately upon any redemption of the Rights, the
right to exercise the Rights will terminate and the only right of
the holders of the Rights will be to receive the Redemption Price.
The terms of the Rights may be amended in certain respects by
the Board of Directors of the Company without the consent of the
holders of the Rights, except that from and after such time as any
person or group of affiliated or associated persons becomes an
Acquiring Person no such amendment may adversely affect the
interests of the holders of the Rights.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, including, without
limitation, the right to vote or to receive dividends.
A copy of the Rights Agreement will be filed with the
Securities and Exchange Commission as an Exhibit to a Registration
Statement on Form 8-A not later than the date on which the Rights
become separately tradeable. A copy of the Rights Agreement is
available free of charge from the Company. This summary
description of the Rights does not purport to be complete and is
qualified in its entirety by reference to the Rights Agreement,
which is hereby incorporated herein by reference.
* * * * * *
