UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) or (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
Piccadilly Cafeterias, Inc.
(Exact name of registrant as specified in its charter)
Louisiana 72-0604977
(State of incorporation or organization) (I.R.S. Employer Identification
Number)
3232 Sherwood Forest Boulevard 70816
Baton Rouge, Louisiana (Zip Code)
(Address of principal executive offices)
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
Title of each class Name of each exchange
TO BE SO REGISTERED ON WHICH EACH CLASS IS TO BE REGISTERED
Preferred Stock Purchase Rights New York Stock Exchange
If this Form relates to the registration of a class of debt securities
and is effective upon filing pursuant to General Instruction A.(c)(1),
please check the following box.
If this Form relates to the registration of a class of debt securities
and is to become effective simultaneous with the effectiveness of a
concurrent registration statement under the Securities Act of 1933 pursuant
to General Instruction A.(c)(2), please check the following box.
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
None
<PAGE>
ITEM 1. DESCRIPTION OF SECURITIES TO BE REGISTERED
On November 2, 1998, the Board of Directors of Piccadilly Cafeterias,
Inc., a Louisiana corporation (the "Company") declared a dividend of one
preferred stock purchase right (a "Right") for each outstanding share of
common stock, no par value (the "Common Stock"), of the Company. The
dividend is payable on November 6, 1998 to shareholders of record on
November 2, 1998 (the "Record Date"). Each Right entitles the registered
holder to purchase from the Company one one-hundredth of a share of Series
A Participating Cumulative Preferred Stock, no par value (the "Preferred
Stock"), of the Company at a price of $51.00 per one one-hundredth of a
share of Preferred Stock (the "Purchase Price"), subject to adjustment.
The description and terms of the Rights are set forth in a Rights Agreement
dated as of November 2, 1998 (the "Rights Agreement") between the Company
and Wachovia Bank, N.A., as Rights Agent (the "Rights Agent").
Subject to certain exceptions, 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 beneficial
ownership of 15% or more of the outstanding Common Stock, or (ii) 10
business days (or such later date as may be determined by action of the
Board of Directors prior to such time as any person or group of affiliated
persons becomes an Acquiring Person) following the commencement of, or
announcement of an intention to make, a tender offer or exchange offer the
consummation of which would result in the beneficial ownership by a person
or group of 15% or more of the outstanding Common Stock (the earlier of
such dates being called the "Distribution Date"), the Rights will be
evidenced, with respect to any of the Common Stock certificates outstanding
as of the Record Date, by such Common Stock certificate, with a copy of a
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 Common Stock. Until the Distribution
Date (or earlier redemption or expiration of the Rights), new Common Stock
certificates issued after the Record Date upon transfer or new issuance of
Common Stock will contain a notation incorporating the Rights Agreement by
reference. Until the Distribution Date (or earlier redemption or
expiration of the Rights), the surrender for transfer of any certificates
for Common Stock outstanding as of the Record Date, even without such
notation or a copy of the Summary of Rights being attached thereto, will
also constitute the transfer of the Rights associated with the Common Stock
represented by such certificate. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Common Stock as
of the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The
Rights will expire on November 2, 2008 (the "Final Expiration Date"),
unless the Final Expiration Date is extended or unless the Rights are
earlier redeemed or exchanged by the Company, in each case, as described
below.
The Purchase Price payable, and the number of shares of Preferred
Stock or other securities or property issuable, upon exercise of the Rights
are subject to adjustment from time to time to prevent dilution (i) in the
event of a stock dividend on, or a subdivision, combination or
reclassification of, the Preferred Stock, (ii) upon the grant to holders of
the Preferred Stock of certain rights or warrants to subscribe for or
purchase Preferred Stock at a price, or securities convertible into
Preferred Stock with a conversion price, less than the then-current market
price of the Preferred Stock or (iii) upon the distribution to holders of
the Preferred Stock of evidences of indebtedness or assets (excluding
regular periodic cash dividends 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).
The number of outstanding Rights and the number of one one-hundredths
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.
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-
hundredth of a share of Preferred Stock, which may, at the election of the
Company, be evidenced by depository 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.
Preferred Stock purchasable upon exercise of the Rights will not be
redeemable. Each share of Preferred Stock will be entitled to a minimum
preferential quarterly dividend payment of $1.00 but will be entitled to an
aggregate dividend of 100 times the dividend declared per share of Common
Stock. In the event of liquidation, the holders of the Preferred Stock
will be entitled to a minimum preferential liquidation payment of $0.01 per
share but will be entitled to an aggregate payment of 100 times the payment
made per share of Common Stock. Each share of Preferred Stock will have
100 votes, voting together with the Common Stock. Finally, in the event of
any merger, consolidation or other transaction in which Common Stock is
exchanged, each share of Preferred Stock will be entitled to receive 100
times the amount received per share of Common Stock. These rights are
protected by customary antidilution provisions.
Because of the nature of the Preferred Stock's dividend, liquidation
and voting rights, the value of the one one-hundredth of a share of
Preferred Stock purchasable upon exercise of each Right should approximate
the value of one share of Common Stock.
At any time after any person or group becomes an Acquiring Person,
each holder of a Right (other than the Acquiring Person) will thereafter
have the right to exercise the Right to purchase, in lieu of Preferred
Stock, Common Stock having a market value, at the time such person or group
became an Acquiring Person, equal to two times the Purchase Price of the
Right.
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 (other
than the Acquiring Person) will thereafter have the right to receive, upon
the exercise thereof at the then-current Purchase 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 Purchase
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 at the time of such occurrence of two times the
Purchase 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 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-hundredth of a share of Preferred Stock,
per Right (subject to adjustment).
At any time prior to the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 15% or more of
the outstanding Common Stock, the Board of Directors of the Company may
redeem the Rights in whole, but not in part, at a price of $.01 per Right
(the "Redemption Price"). The redemption of the Rights may be made
effective at such time, on such basis and with such conditions as the Board
of Directors in its sole discretion may establish. Immediately upon any
redemption of the Rights, the right to exercise the Rights will terminate
and the only right of the holders of Rights will be to receive the
Redemption Price.
The terms of the Rights may be amended by the Board of Directors of
the Company without the consent of the holders of the Rights, including an
amendment to lower the thresholds described above, 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 shareholder of the Company, including, without limitation, the
right to vote or to receive dividends.
As of November 2, 1998 there were 10,528,368 shares of Common Stock
issued and outstanding. As long as the Rights are attached to the Common
Stock, the Company will issue one Right with each new share of Common Stock
so that all such shares will have Rights attached.
The Rights Agreement and the press release announcing the declaration
of the Rights are attached hereto as exhibits and are incorporated herein
by reference. The foregoing description of the Rights is qualified in its
entirety by reference to such exhibits.
ITEM 2. EXHIBITS
1. Rights Agreement, dated as of November 2, 1998, between
Piccadilly Cafeterias, Inc. and Wachovia Bank, N.A., as Rights
Agent.
2. Form of Articles of Amendment to the Articles of Incorporation,
included in Exhibit A to the Rights Agreement.
3. Forms of Rights Certificate, Assignment, and Election to
Purchase, included in Exhibit B to the Rights Agreement.
4. Summary Description of the Shareholder Rights Plan, included in
Exhibit C to the Rights Agreement.
5. Press release dated November 2, 1998.
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this registration statement to
be signed on its behalf by the undersigned thereunto duly authorized.
PICCADILLY CAFETERIAS, INC.
By: /s/ Ronald A. LaBorde
Name: Ronald A. LaBorde
Title: President and Chief Executive
Officer
Dated: November 19, 1998
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
1. Rights Agreement, dated as of November 2, 1998, between
Piccadilly Cafeterias, Inc. and Wachovia Bank, N.A., as
Rights Agent.
2. Form of Articles of Amendment to the Articles of
Incorporation, included in Exhibit A to the Rights Agreement.
3. Forms of Rights Certificate, Assignment, and Election to
Purchase, included in Exhibit B to the Rights Agreement.
4. Summary Description of the Shareholder Rights Plan, included
in Exhibit C to the Rights Agreement.
5. Press release dated November 2, 1998.
RIGHTS AGREEMENT
dated as of
NOVEMBER 2, 1998
between
PICCADILLY CAFETERIAS, INC.
and
WACHOVIA BANK, N.A.
as Rights Agent
<PAGE>
PAGE
TABLE OF CONTENTS
PAGE
SECTION 1. Definitions 1
SECTION 2. Appointment of Rights Agent 5
SECTION 3. Issue of Right Certificates 5
SECTION 4. Form of Right Certificates 7
SECTION 5. Countersignature and Registration 7
SECTION 6. Transfer 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. Reservation and Availability of Capital Stock 11
SECTION 10. Preferred Stock Record Date 12
SECTION 11. Adjustment of Purchase Price, Number and Kind of
Shares or Number of Rights 12
SECTION 12. Certificate of Adjusted Purchase Price or Number of
Shares 20
SECTION 13. Consolidation, Merger or Sale or Transfer of Assets
or Earning Power 21
SECTION 14. Fractional Rights and Fractional Shares 23
SECTION 15. Rights of Action 24
SECTION 16. Agreement of Right Holders 25
SECTION 17. Right Certificate Holder Not Deemed a Shareholder 26
SECTION 18. Concerning the Rights Agent 26
SECTION 19. Merger or Consolidation or Change of Name of Rights
Agents 26
SECTION 20. Duties of Rights Agent 27
SECTION 21. Change of Rights Agent 29
SECTION 22. Issuance of New Right Certificates 30
SECTION 23. Redemption 30
SECTION 24. Exchange 31
SECTION 25. Notice of Proposed Actions 32
SECTION 26. Notices 33
SECTION 27. Supplements and Amendments 33
SECTION 28. Successors 34
SECTION 29. Determinations and Actions by the Board, etc 34
SECTION 30. Benefits of this Agreement 34
SECTION 31. Severability 34
SECTION 32. Governing Law 34
SECTION 33. Counterparts 35
SECTION 34. Descriptive Headings 35
Exhibit A - Form of Articles of Amendment to the Articles of
Incorporation
Exhibit B - Form of Right Certificate
Exhibit C - Summary Description of the Shareholder Rights Plan
<PAGE>
PAGE
RIGHTS AGREEMENT
AGREEMENT dated as of November 2, 1998 between Piccadilly
Cafeterias, Inc., a Louisiana corporation (the "COMPANY"), and
Wachovia Bank, N.A., as Rights Agent (the "RIGHTS AGENT"),
W I T N E S S E T H
WHEREAS, on November 2, 1998 the Board of Directors of the
Company authorized and declared a dividend of one preferred stock
purchase right (a "RIGHT") for each share of Common Stock (as
hereinafter defined) outstanding at the close of business on
November 2, 1998 (the "RECORD DATE") and has authorized the issuance,
upon the terms and subject to the conditions hereinafter set forth, of
one Right (subject to adjustment) in respect of each share of Common
Stock issued after the Record Date, each Right representing the right
to purchase, upon the terms and subject to the conditions hereinafter
set forth, one one-hundredth (subject to adjustment) of a share of
Preferred Stock (as hereinafter defined);
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. Definitions. The following terms, as used herein,
have the following meanings:
"ACQUIRING PERSON" means any Person who, together with all
Affiliates and Associates of such Person, is the Beneficial Owner of
the Threshold Percentage, but shall not include an Exempt Person;
provided, however, that (a) if the Board determines in good faith that
a Person who would otherwise be an "Acquiring Person" became the
Beneficial Owner of a number of shares of Common Stock, such that the
Person would otherwise qualify as an "Acquiring Person" inadvertently
(including, without limitation, because (i) such Person was unaware
that it beneficially owned a percentage of Common Stock that would
otherwise cause such Person to be an "Acquiring Person" or (ii) such
Person was aware of the extent of its Beneficial Ownership of Common
Stock but had no actual knowledge of the consequences of such
Beneficial Ownership under this Agreement) and without any intention
of changing, exercising or influencing control of the Company, then
such Person shall not be deemed to be or to have become an "Acquiring
Person" for any purposes of this Agreement unless and until such
Person shall have failed to divest itself as soon as practicable (as
determined, in good faith, by the Board of Directors of the Company)
of Beneficial Ownership of a sufficient number of shares of Common
Stock so that such Person would no longer otherwise qualify as an
"Acquiring Person"; and (b) no Person shall become an "Acquiring
Person" as the result of any acquisition of shares of Common Stock by
the Company which, by reducing the number of shares of Common Stock
outstanding, increases the proportionate number of shares of Common
Stock beneficially owned by such Person to the Threshold Percentage;
provided, however, that if a Person shall become the Beneficial Owner
of the Threshold Percentage by reason of such share acquisition by the
Company and shall thereafter become the Beneficial Owner of any
additional shares of Common Stock(other than pursuant to a dividend or
distribution paid or made by the Company on the outstanding Common
Stock or pursuant to a split or subdivision of the outstanding Common
Stock), then such Person shall be deemed to be an "Acquiring Person"
unless upon becoming the Beneficial Owner of such additional shares of
Common Stock such Person does not beneficially own the Threshold
Percentage.
"AFFILIATE" and "ASSOCIATE" have the respective meanings ascribed
to such terms in Rule 12b-2 under the Exchange Act as in effect on the
date hereof.
A Person shall be deemed the "BENEFICIAL OWNER" of, and shall be
deemed to have "Beneficial Ownership" of and to "beneficially own",
any securities:
(a) which such Person or any of its Affiliates or
Associates, directly or indirectly, beneficially owns (as
determined pursuant to Rule 13d-3 under the Exchange Act as in
effect on the date hereof);
(b) which such Person or any of its Affiliates or
Associates, directly or indirectly, has
(i) the right to acquire (whether such right
is exercisable immediately or only upon the occurrence of
certain events or the passage of time or both) pursuant to
any agreement, arrangement or understanding (other than
customary agreements with and between underwriters and
selling group members with respect to a bona fide public
offering of securities), or upon the exercise of conversion
rights, exchange rights, rights, warrants or options, or
otherwise; provided, however, that a Person shall not be
deemed the "Beneficial Owner" of, or to "beneficially own",
(A) 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, (B) securities which
such Person has a right to acquire upon the exercise of
Rights at any time prior to the time that any Person becomes
an Acquiring Person or (C) securities issuable upon the
exercise of Rights from and after the time that any Person
becomes an Acquiring Person if such Rights were acquired by
such Person or any of such Person's Affiliates or Associates
prior to the Distribution Date or pursuant to Section 3(a)
or Section 22 hereof ("ORIGINAL RIGHTS") or pursuant to
Section 11(i) or Section 11(p) with respect to an adjustment
to Original Rights; or
(ii) the right to vote (whether such right is
exercisable immediately or only upon the occurrence of
certain events or the passage of time or both) pursuant to
any agreement, arrangement or understanding (whether or not
in writing) or otherwise; provided that a Person shall not
be deemed the "Beneficial Owner" of, or to "beneficially
own", any security under this clause (ii) as a result of an
agreement, arrangement or understanding to vote such
security if such agreement, arrangement or understanding (A)
arises solely from a revocable proxy or consent given in
response to a public proxy or consent solicitation made
pursuant to the applicable rules and regulations under the
Exchange Act and (B) is not also then reportable by such
Person on Schedule 13D under the Exchange Act (or any
comparable or successor report); or
(c) which are beneficially owned, directly or
indirectly, by any other Person (or any Affiliate or Associate
thereof) and with respect to which such Person or any of its
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 pursuant to a revocable proxy or consent
as described in subparagraph (b)(ii) immediately above) or
disposing of any such securities;
provided, however, that no Person who is an officer, director or
employee of an Exempt Person shall be deemed, solely by reason of such
Person's status or authority as such, to be the "Beneficial Owner" of,
to have "Beneficial Ownership" of or to "beneficially own" any
securities that are "beneficially owned", including, without
limitation, in a fiduciary capacity, by an Exempt Person or by any
other such officer, director or employee of an Exempt Person.
"BOARD" means the Board of Directors of the Company.
"BUSINESS DAY" means any day other than a Saturday, Sunday or a
day on which banking institutions in the State of New York are
authorized or obligated by law or executive order to close.
"CLOSE OF BUSINESS" on any given date means 5:00 P.M., New York
City time, on such date; provided that if such date is not a Business
Day "close of business" means 5:00 P.M., New York City time, on the
next succeeding Business Day.
"COMMON STOCK" means the Common Stock, no par value, of the
Company, and any other common stock of the Company, except that, when
used with reference to any Person other than the Company, "Common
Stock" means the capital stock of such Person with the greatest voting
power, or the equity securities or other equity interest having power
to control or direct the management, of such Person.
"DISTRIBUTION DATE" means the earlier of (a) the close of
business on the tenth day after the Stock Acquisition Date and (b) the
close of business on the tenth Business Day (or such later day as may
be designated prior to the occurrence of a Section 11(a)(ii) Event by
action of the Board) after the date of the commencement of a tender or
exchange offer by any Person if, upon consummation thereof, such
Person would be an Acquiring Person; provided, however, that if either
of such dates occurs after the date of this Agreement and on or prior
to the Record Date, then the Distribution Date shall be the Record
Date.
"EXEMPT PERSON" shall mean the Company or any Subsidiary of the
Company, in each case including, without limitation, in its fiduciary
capacity, or any employee benefit plan of the Company or of any
Subsidiary of the Company, or any entity or trustee holding Common
Stock for or pursuant to the terms of any such plan or for the purpose
of funding any such plan or funding other employee benefits for
employees of the Company or of any Subsidiary of the Company.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXPIRATION DATE" means the earlier of (a) the Final Expiration
Date and (b) the time at which all Rights are redeemed as provided in
Section 23 or exchanged as provided in Section 24.
"FINAL EXPIRATION DATE" means the close of business on
November 2, 2008.
"PERSON" means an individual, corporation, limited liability
company, partnership, association, trust or any other entity or
organization.
"PREFERRED STOCK" means the Series A Participating Cumulative
Preferred Stock, no par value, of the Company, having the terms set
forth in the form of articles of amendment attached hereto as Exhibit
A.
"PURCHASE PRICE" means the price (subject to adjustment as
provided herein) at which a holder of a Right may purchase one
one-hundredth of a share of Preferred Stock (subject to adjustment as
provided herein) (or, in accordance with Section 11(a)(ii), may
purchase the Adjustment Shares-(as defined therein)) upon exercise of
a Right, which price shall initially be $51.00.
"SECTION 11(A)(II) EVENT" means any event described in the first
clause of Section 11(a)(ii).
"SECTION 13 EVENT" means any event described in clauses (x), (y)
or (z) of Section 13(a).
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"STOCK ACQUISITION DATE" means the date of the first public
announcement (including through the filing of a report on Schedule 13D
under the Exchange Act (or any comparable or successor report)) by the
Company or an Acquiring Person indicating that an Acquiring Person has
become such.
"SUBSIDIARY" of any Person means any other Person of which
securities or other ownership interests having ordinary voting power,
in the absence of contingencies, to elect a majority of the board of
directors or other Persons performing similar functions are at the
time directly or indirectly owned by such first Person.
"THRESHOLD PERCENTAGE", as of any date of determination, means
with respect to any Person and its Affiliates and Associates, 15% of
all then-outstanding Common Stock.
"TRADING DAY" means a day on which the principal national
securities exchange on which the shares of Common Stock are listed or
admitted to trading is open for the transaction of business or, if the
shares of Common Stock are not listed or admitted to trading on any
national securities exchange, a Business Day.
"TRIGGERING EVENT" means any Section 11(a)(ii) Event or any
Section 13 Event.
SECTION 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company and the
holders of the Rights 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 (each, a
"Co-Rights Agent") as it may deem necessary or desirable. If the
Company appoints one or more Co-Rights Agents, the respective duties
of the Rights Agent and any Co-Rights Agents shall be as the Company
shall determine, and references herein to the "Rights Agent" shall be
deemed to refer to the Rights Agent and/or the Co-Rights Agent, as
applicable.
SECTION 3. Issue of Right Certificates. (a) Prior to the
Distribution Date, (i) the Rights will be evidenced (subject to the
next to the last sentence of this Section 3(a)) by the certificates
for the Common Stock and not by separate Right Certificates (as
hereinafter defined) and the registered holders of the Common Stock
shall be deemed to be the registered holders of the associated Rights,
and (ii) the Rights will be transferable only in connection with the
transfer of the underlying shares of Common Stock. As soon as
practicable after the Record Date, the Company will send a copy of the
Summary of Rights substantially in the form of Exhibit C hereto, by
first-class, postage prepaid mail, to each record holder of the 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, prior
to 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. Prior to the Distribution Date
(or, if earlier, the Expiration Date), the surrender for transfer of
any certificate for Common Stock outstanding on the Record Date, with
or without a copy of the Summary of Rights, shall also constitute the
transfer of the Rights associated with the Common Stock represented
thereby.
(b) As soon as practicable after the Company has notified the
Rights Agent of the occurrence of the Distribution Date, the Rights
Agent will send, by first-class, insured, postage prepaid mail, to
each record holder of the Common Stock as of the close of business on
the Distribution Date (other than any Acquiring Person or any
Affiliate or Associate thereof), at the address of such holder shown
on the records of the Company, one or more Right Certificates
evidencing one Right (subject to adjustment as provided herein) for
each share of Common Stock so held. If an adjustment in the number of
Rights per share of Common Stock has been made pursuant to Section 11
the Company shall, at the time of distribution of the Right
Certificates, make the necessary and appropriate rounding adjustments
(in accordance with Section 14(a)) so that Right Certificates
representing only whole numbers of Rights are distributed and cash is
paid in lieu of any fractional Rights. From and after the
Distribution Date, the Rights will be evidenced solely by such Right
Certificates.
(c) Rights shall be issued in respect of all shares of Common
Stock outstanding as of the Record Date or issued (on original
issuance or out of treasury) after the Record Date but prior to the
earlier of the Distribution Date and the Expiration Date. In
addition, in connection with the issuance or sale of shares of Common
Stock following the Distribution Date and prior to the Expiration
Date, the Company (i) shall, with respect to shares of Common Stock so
issued or sold (x) pursuant to the exercise of stock options or under
any employee plan or arrangement or (y) upon the exercise, conversion
or exchange of other securities issued by the Company prior to the
Distribution Date and (ii) may, in any other case, if deemed necessary
or appropriate by the Board, issue Right Certificates representing the
appropriate number of Rights in connection with such issuance or sale;
provided that no such Right Certificate shall be issued if, and to the
extent that, (i) the Company shall be advised by counsel that such
issuance would create a significant risk of material adverse tax
consequences to the Company or the Person to whom such Right
Certificate would be issued or (ii) appropriate adjustment shall
otherwise have been made in lieu of the issuance thereof.
(d) Certificates issued for Common Stock after the Record Date
but prior to the earlier of the Distribution Date and the Expiration
Date shall have impressed on, printed on, written on or otherwise
affixed to them the following legend:
This certificate also evidences certain Rights as set forth in
a Rights Agreement between Piccadilly Cafeterias, Inc. and
Wachovia Bank, N.A. dated as of November 2, 1998 and as
amended from time to time (the "RIGHTS AGREEMENT"), the terms
of which are hereby incorporated herein by reference and a
copy of which is on file at the principal executive offices of
the Company. The Company will mail to the holder of this
certificate a copy of the Rights Agreement without charge
promptly after receipt of a written request therefor. Under
certain circumstances, as set forth in the Rights Agreement,
such Rights may be evidenced by separate certificates and no
longer be evidenced by this certificate, may be redeemed or
exchanged or may expire. AS SET FORTH IN THE RIGHTS
AGREEMENT, RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO IS,
WAS OR BECOMES AN ACQUIRING PERSON OR AN AFFILIATE OR
ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT), WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH
PERSON OR BY ANY SUBSEQUENT HOLDER, MAY BE NULL AND VOID.
SECTION 4. Form of Right Certificates. The certificates
evidencing the Rights (and the forms of assignment, election to
purchase and certificates to be printed on the reverse thereof) (the
"RIGHT CERTIFICATES") shall be substantially in the form of Exhibit B
hereto and may have such marks of identification or designation and
such legends, summaries or endorsements printed thereon as the Company
may deem appropriate and as are not inconsistent with the provisions
of this Agreement, or as may be required to comply with any applicable
law, rule or regulation 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. The Right Certificates, whenever distributed, shall
be dated as of the Record Date.
SECTION 5. Countersignature and Registration. (a) The Right
Certificates shall be executed on behalf of the Company by its
President and Chief Executive Officer or Secretary, either manually or
by facsimile signature, and shall have affixed thereto the Company's
seal or a facsimile thereof which shall be attested by the Secretary
or an Assistant Secretary of the Company, either manually or by
facsimile signature. The Right Certificates shall be manually
countersigned by the Rights Agent and shall not be valid for any
purpose unless so countersigned. In case any officer of the Company
whose manual or facsimile signature is affixed to 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 may, nevertheless, be countersigned
by the Rights Agent and issued and delivered 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. Any Right Certificate may
be signed on behalf of the Company by any Person who, at the actual
date of the execution of such Right Certificate, shall be a proper
officer of the Company to sign such Right Certificate, although at the
date of the execution of this Rights Agreement any such Person was not
such an officer.
(b) Following the Distribution Date, the Rights Agent will keep
or cause to be kept, at its principal office or offices designated as
the place for surrender of Right Certificates upon exercise, transfer
or exchange, books for registration and transfer of the Right
Certificates. Such books shall show with respect to each Right
Certificate the name and address of the registered holder thereof, the
number of Rights indicated on the certificate and the certificate
number.
SECTION 6. Transfer and Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen Right Certificates. (a) At any
time after the Distribution Date and prior to the Expiration Date, any
Right Certificate or Certificates may, upon the terms and subject to
the conditions set forth in this Agreement, be transferred or
exchanged for another Right Certificate or Certificates evidencing a
like number of Rights as the Right Certificate or Certificates
surrendered. Any registered holder desiring to transfer or exchange
any Right Certificate or Certificates shall surrender such Right
Certificate or Certificates (with, in the case of a transfer, the form
of assignment and certificate on the reverse side thereof duly
executed) to the Rights Agent at the principal office or offices of
the Rights Agent designated for such purpose. Neither the Rights
Agent nor the Company shall be obligated to take any action whatsoever
with respect to the transfer of any such surrendered Right Certificate
or Certificates until the registered holder of the Rights has complied
with the requirements of Section 7(e). Upon satisfaction of the
foregoing requirements, the Rights Agent shall, subject to Sections
7(d), 14 and 24, countersign and deliver to the Person entitled
thereto a Right Certificate or Certificates as so requested. The
Company may require payment of a sum sufficient to cover any transfer
tax or other governmental charge that may be imposed in connection
with any transfer or exchange of any Right Certificate or
Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in 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 issue and deliver a new
Right Certificate of like tenor to the Rights Agent for
countersignature and delivery to the registered owner 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, including Sections 7(d), 7(e), 9(c), 11(a), 23 and 24) in
whole or in part at any time after the Distribution Date and prior to
the Expiration Date upon surrender of the Right Certificate, with the
form of election to purchase and the certificate on the reverse side
thereof duly executed, to the Rights Agent at the principal office or
offices of the Rights Agent designated for such purpose, together with
payment (in lawful money of the United States of America by certified
check or bank draft payable to the order of the Company) of the
aggregate Purchase Price with respect to the Rights then to be
exercised and an amount equal to any applicable transfer tax or other
governmental charge.
(b) Upon satisfaction of the requirements of Section 7(a) and
subject to Section 20(k), the Rights Agent shall thereupon promptly
(i) (A) requisition from any transfer agent of the Preferred Stock (or
make available, if the Rights Agent is the transfer agent therefor)
certificates for the total number of one one-hundredths of a share of
Preferred Stock to be purchased (and the Company hereby irrevocably
authorizes its transfer agent to comply with all such requests) or (B)
if the Company shall have elected to deposit the shares of Preferred
Stock issuable upon exercise of the Rights with a depositary agent,
requisition from the depositary agent depositary receipts representing
interests in such number of one one-hundredths 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 with the depositary agent) and the
Company will direct the depositary agent to comply with such request,
(ii) requisition from the Company the amount of cash, if any, to be
paid in lieu of issuance of fractional shares in accordance with
Section 14 and (iii) after receipt of such certificates or depositary
receipts and cash, if any, cause the same to be delivered to or upon
the order of the registered holder of such Right Certificate (with
such certificates or receipts registered in such name or names as may
be designated by such holder). If the Company is obligated to deliver
Common Stock, other securities or assets pursuant to this Agreement,
the Company will make all arrangements necessary so that such other
securities and assets are available for delivery by the Rights Agent,
if and when appropriate.
(c) In case the registered holder of any Right Certificate shall
exercise less than all the Rights evidenced thereby, a new Right
Certificate evidencing the number of Rights remaining unexercised
shall be issued by the Rights Agent and 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, subject to
the provisions of Section 14.
(d) Notwithstanding anything in this Agreement to the contrary,
from and after the first occurrence of a Section 11(a)(ii) Event, any
Rights beneficially owned by (i) an Acquiring Person or an Associate
or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring
Person (or of any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person becomes such or (iii) a
transferee of an Acquiring Person (or of any such Associate or
Affiliate) who becomes a transferee prior to or concurrently with the
Acquiring Person becoming such and receives such Rights pursuant to
either (A) a transfer (whether or not for consideration) from the
Acquiring Person (or any such Associate or Affiliate) to holders of
equity interests in such Acquiring Person (or in any such Associate or
Affiliate) or to any Person with whom the Acquiring Person (or any
such Associate or Affiliate) has any continuing agreement, arrangement
or understanding regarding the transferred Rights or (B) a transfer
which is part of a plan, arrangement or understanding which has as a
primary purpose or effect the avoidance of this Section 7(d) shall
become null and void without any further action, and no holder of such
Rights shall have any rights whatsoever with respect to such Rights,
whether under any provision of this Agreement or otherwise. The
Company shall use all reasonable efforts to insure that the provisions
of this Section 7(d) are complied with, but shall have no liability to
any holder of Right Certificates or other Person as a result of its
failure to make any determinations with respect to an Acquiring Person
or its Affiliates and Associates or any transferee of any of them
hereunder.
(e) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder of Rights
upon the occurrence of any purported transfer pursuant to Section 6 or
exercise pursuant to this Section 7 unless such registered holder (i)
shall have completed and signed the certificate contained in the form
of assignment or election to purchase, as the case may be, set forth
on the reverse side of the Right Certificate surrendered for such
transfer or exercise, as the case may be, (ii) shall not have
indicated an affirmative response to clause 1 or 2 thereof and (iii)
shall have provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or
Associates thereof as the Company shall reasonably request.
SECTION 8. Cancellation and Destruction of Right Certificates.
All Right Certificates surrendered for exercise, transfer or exchange
shall, if surrendered to the Company or to any of its agents, be
delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered to the Rights Agent, shall be canceled by it, and
no Right Certificates shall be issued in lieu thereof except as
expressly permitted by this Agreement. The Company shall deliver to
the Rights Agent for cancellation, and the Rights Agent shall cancel,
any other Right Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall
deliver all canceled Right Certificates to the Company, or shall, at
the written request of the Company, destroy such canceled Right
Certificates, and in such case shall deliver a certificate of
destruction thereof to the Company.
SECTION 9. Reservation and Availability of Capital Stock. (a)
The Company covenants and agrees that it will cause to be reserved and
kept available a number of shares of Preferred Stock which are
authorized but not outstanding or otherwise reserved for issuance
sufficient to permit the exercise in full of all outstanding Rights as
provided in this Agreement.
(b) So long as the Preferred Stock issuable upon the exercise of
Rights may be listed on any national securities exchange, the Company
shall use its best efforts to cause, from and after such time as the
Rights become exercisable, all securities reserved for such issuance
to be listed on any such exchange upon official notice of issuance
upon such exercise.
(c) The Company shall use its best efforts (i) to file, as soon
as practicable following the earliest date after the occurrence of a
Section 11(a)(ii) Event as of which the consideration to be delivered
by the Company upon exercise of the Rights has been determined in
accordance with Section 11(a)(iii), or as soon as is required by law
following the Distribution Date, as the case may be, a registration
statement under the Securities Act with respect to the securities
issuable upon exercise of the Rights, (ii) to cause such registration
statement to become effective as soon as practicable after such filing
and (iii) to cause such registration statement to remain effective
(with a prospectus at all times meeting the requirements of the
Securities Act) until the earlier of (A) the date as of which the
Rights are no longer exercisable for such securities and (B) the
Expiration Date. The Company will also take such action as may be
appropriate under, or to ensure compliance with, the securities or
blue sky laws of the various states in connection with the
exercisability of the Rights. The Company may temporarily suspend,
for a period of time not to exceed 90 days after the date set forth in
clause 9(c)(i), the exercisability of the Rights in order to prepare
and file such registration statement and permit it to become
effective. Upon any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been
temporarily suspended, as well as a public announcement at such time
as the suspension is no longer in effect. Notwithstanding any such
provision of this Agreement to the contrary, the Rights shall not be
exercisable for securities in any jurisdiction if the requisite
qualification in such jurisdiction shall not have been obtained, such
exercise therefor shall not be permitted under applicable law or a
registration statement in respect of such securities shall not have
been declared effective.
(d) The Company covenants and agrees that it will take all such
action as may be necessary to insure that all one one-hundredths of a
share of Preferred Stock issuable upon exercise of Rights shall, at
the time of delivery of the certificates for such securities (subject
to payment of the Purchase Price), be duly and validly authorized and
issued and fully paid and nonassessable.
(e) The Company further covenants and agrees that it will pay
when due and payable any and all federal and state transfer taxes and
other governmental charges which may be payable in respect of the
issuance or delivery of the Right Certificates and of any certificates
for Preferred Stock upon the exercise of Rights. The Company shall
not, however, be required to pay any transfer tax or other
governmental charge which may be payable in respect of any transfer
involved in the issuance or delivery of any Right Certificates or of
any certificates for Preferred Stock to a Person other than the
registered holder of the applicable Right Certificate, and prior to
any such transfer, issuance or delivery any such tax or other
governmental charge shall have been paid by the holder of such Right
Certificate or it shall have been established to the Company's
satisfaction that no such tax or other governmental charge is due.
SECTION 10. Preferred Stock Record Date. Each Person (other
than the Company) in whose name any certificate for Preferred Stock is
issued upon the exercise of Rights shall for all purposes be deemed to
have become the holder of record of such 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 transfer taxes or other
governmental charges) was made; provided that if the date of such
surrender and payment is a date upon which the transfer books of the
Company relating to the Preferred Stock are closed, such Person shall
be deemed to have become the record holder of such shares on, and such
certificate shall be dated, the next succeeding Business Day on which
the applicable 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 shareholder of
the Company with respect to shares for which the Rights shall be
exercisable, including the right to vote, to receive dividends or
other distributions or to exercise any preemptive rights, and shall
not be entitled to receive any notice of any proceedings of the
Company except as provided herein.
SECTION 11. Adjustment of Purchase Price, Number and Kind of
Shares or Number of Rights. (a) (i) If the Company shall at any
time after the date of this Agreement (A) pay a dividend on the
Preferred Stock payable in shares of Preferred Stock, (B) subdivide
the outstanding Preferred Stock into a greater number of shares, (C)
combine the outstanding Preferred Stock into a smaller number of
shares 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
involving the Company), the Purchase Price in effect immediately prior
to the record date for such dividend or the effective date of such
subdivision, combination or reclassification, and the number and kind
of shares of Preferred Stock or other capital stock issuable on such
date shall be proportionately adjusted so that each holder of a Right
shall (except as otherwise provided herein, including Section 7(d))
thereafter be entitled to receive, upon exercise thereof at the
Purchase Price in effect immediately prior to such date, the aggregate
number and kind of shares of Preferred Stock or other capital stock,
as the case may be, which, if such Right had been exercised
immediately prior to such date and at a time when the applicable
transfer books of the Company were open, such holder would have been
entitled to receive upon such exercise and by virtue of such dividend,
subdivision, combination or reclassification. If an event occurs
which requires an adjustment under both this Section 11(a)(i) and
Section 11(a)(ii), the adjustment provided for in this Section
11(a)(i) shall be in addition to, and shall be made prior to, any
adjustment required pursuant to Section 11(a)(ii).
(ii) If any Person, alone or together with its Affiliates and
Associates, shall, at any time after the date of this Agreement,
become an Acquiring Person, then each holder of a Right shall (except
as otherwise provided herein, including Section 7(d)) thereafter be
entitled to receive, upon exercise thereof at the Purchase Price in
effect immediately prior to the first occurrence of a Section
11(a)(ii) Event, in lieu of Preferred Stock, such number of duly
authorized, validly issued, fully paid and nonassessable shares of
Common Stock of the Company (such shares being referred to herein as
the "ADJUSTMENT SHARES") as shall be equal to the result obtained by
dividing
(x) the product obtained by multiplying the Purchase
Price in effect immediately prior to the first occurrence of a
Section 11(a)(ii) Event by the number of one one-hundredths of a
share of Preferred Stock for which a Right was exercisable
immediately prior to such first occurrence (such product being
thereafter referred to as the "PURCHASE PRICE" for each Right) by
(y) 50% of the current market price (determined
pursuant to Section 11(d)(i)) per share of Common Stock on the
date of such first occurrence;
provided, however, that the Purchase Price (as so adjusted pursuant
this clause (ii)) and the number of Adjustment Shares receivable upon
exercise of a Right shall, following the occurrence of such Section
11(a)(ii) Event, be subject to further adjustment as appropriate in
accordance with Section 11(f). From and after the occurrence of a
Section 13 Event, any Rights that theretofore have not been exercised
pursuant to this Section 11(a)(ii) shall thereafter be exercisable
only in accordance with Section 13 and not pursuant to this Section
11(a)(ii).
(iii) If the number of shares of Common Stock which are authorized
by the Company's articles of incorporation but not outstanding or
reserved for issuance other than upon exercise of the Rights is not
sufficient to permit the exercise in full of the Rights in accordance
with Section 11(a)(ii), the Company shall, with respect to each Right,
make adequate provision to substitute for the Adjustment Shares, upon
payment of the Purchase Price then in effect, (A) (to the extent
available) shares of Common Stock and then, (B) (to the extent
available) such number of one one-hundredths of a share of Preferred
Stock as are then equivalent in value to the value of the Adjustment
Shares, and then, if necessary, (C) other equity or debt securities
of the Company, cash or other assets, a reduction in the Purchase
Price or any combination of the foregoing, having an aggregate value
(based upon the advice of a nationally recognized investment banking
firm) equal to the value of the Adjustment Shares; provided that
(x) the Company may, and (y) if the Company shall not have made
adequate provision as required above to deliver value within 30 days
following the first occurrence of a Section 11(a)(ii) Event (the
"SUBSTITUTION PERIOD"), then the Company shall be obligated to
deliver, upon the surrender for exercise of a Right and without
requiring payment of the Purchase Price, (1) (to the extent available)
shares of Common Stock and then (2) (to the extent available) one-
hundredths of a share of Preferred Stock and then, if necessary, (3)
other equity or debt securities of the Company, cash or other assets
or any combination of the foregoing, having an aggregate value (based
upon the advice of a nationally recognized investment banking firm)
equal to the excess of the value of the Adjustment Shares over the
Purchase Price. To the extent that the Company determines that some
action is required to be taken pursuant to the preceding sentence, the
Company (x) shall provide, subject to Section 7(d), that such action
shall apply uniformly to all outstanding Rights and (y) may suspend
the exercisability of the Rights until the expiration of the
Substitution Period in order to decide the appropriate form and value
of any consideration to be delivered as referred to in the preceding
sentence. If any such suspension occurs, the Company shall issue a
public announcement stating that the exercisability of the Rights has
been temporarily suspended, as well as a public announcement at such
time as the suspension is no longer in effect. For purposes of this
Section 11(a)(iii), the value of Common Stock shall be the current
market price per share of such Common Stock (as determined pursuant to
Section 11(d)) on the date of the first occurrence of a Section
11(a)(ii) Event; any common stock equivalent shall be deemed to have
the same value as the Common Stock on such date; and the value of
other securities or assets shall be determined pursuant to Section
11(d)(iii).
(b) In case the Company shall fix a record date for the issuance
of rights, options or warrants to all holders of Preferred Stock
entitling them to subscribe for or purchase (for a period expiring
within 45 calendar days after such record date) Preferred Stock (or
securities having the same rights, privileges and preferences as the
shares of Preferred Stock ("EQUIVALENT PREFERRED STOCK")) or
securities convertible into or exercisable for Preferred Stock (or
equivalent preferred stock) at a price per share of Preferred Stock
(or equivalent preferred stock) (in each case, taking account of any
conversion or exercise price) less than the current market price (as
determined pursuant to Section 11(d)) per share of 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
immediately prior to such date by a fraction, the numerator of which
shall be the number of shares of Preferred Stock outstanding on such
record date, plus the number of shares of Preferred Stock which the
aggregate price (taking account of any conversion or exercise price)
of the total number of shares of Preferred Stock (and/or equivalent
preferred stock) so to be offered would purchase at such current
market price and the denominator of which shall be the number of
shares of Preferred Stock outstanding on such record date plus the
number of additional shares of Preferred Stock (and/or equivalent
preferred stock) so to be offered. In case such subscription price
may be paid by delivery of 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, whose determination shall be
described in a statement filed with the Rights Agent and shall be
conclusive for all purposes. Shares of 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 if 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 Preferred Stock (including any such
distribution made in connection with a consolidation or merger
involving the Company) of evidences of indebtedness, equity securities
other than Preferred Stock, assets (other than a regular periodic cash
dividend out of the earnings or retained earnings of the Company) or
rights, options or warrants (excluding those referred to in Section
11(b)), the Purchase Price to be in effect after such record date
shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of
which shall be the current market price (as determined pursuant to
Section 11(d)) per share of Preferred Stock on such record date, less
the value (as determined pursuant to Section 11(d)(iii)) of such
evidences of indebtedness, equity securities, assets, rights, options
or warrants so to be distributed with respect to one share of
Preferred Stock and the denominator of which shall be such current
market price per share of Preferred Stock. Such adjustment shall be
made successively whenever such a record date is fixed, and if such
distribution is not so made, 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.
(d) (i) For the purpose of any computation hereunder other than
computations made pursuant to Section 11(a)(iii) or 14, the "current
market price" per share of Common Stock on any date shall be deemed to
be the average of the daily closing prices per share of such Common
Stock for the 30 consecutive Trading Days ending on the last Trading
Day immediately prior to such date; for purposes of computations made
pursuant to Section 11(a)(iii), the "current market price" per share
of Common Stock on any date shall be deemed to be the average of the
daily closing prices per share of such Common Stock for the 10
consecutive Trading Days immediately following such date; and for
purposes of computations made pursuant to Section 14, the "current
market price" per share of such Common Stock for any Trading Day shall
be deemed to be the closing price per share of such Common Stock for
such Trading Day; provided that if the current market price per share
of such Common Stock is determined during a period following the
announcement by the issuer of such Common Stock of (A) a dividend or
distribution on such Common Stock payable in shares of such Common
Stock or securities exercisable for or convertible into shares of such
Common Stock (other than the Rights), or (B) any subdivision,
combination or reclassification of such Common Stock, and prior to the
expiration of the requisite 30 Trading Day or 10 Trading Day period,
as set forth above, 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 market
price" shall be properly adjusted to take into account ex-dividend
trading. The closing price for each day shall be the last sale price,
regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either
case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the
New York Stock Exchange or, if such shares of Common Stock are not
listed or admitted to trading on the New York Stock Exchange, on the
principal national securities exchange on which such shares of Common
Stock are listed or admitted to trading or, if such shares of Common
Stock 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 the National Association of Securities Dealers, Inc.
Automated Quotation System ("NASDAQ") or such other system then in use
or, if on any such date such shares of Common Stock are not quoted by
any such organization, the average of the closing bid and asked prices
as furnished by a professional market maker making a market in such
Common Stock selected by the Board. If on any such date no market
maker is making a market in such Common Stock, the fair value of such
shares on such date as determined in good faith by the Board (or, if
at the time of such determination there is an Acquiring Person, by a
nationally recognized investment banking firm) shall be used. If
Common Stock is not publicly held or not so listed or traded, the
"CURRENT MARKET PRICE" per share of such Common Stock means the fair
value per share as determined in good faith by the Board, or, if at
the time of such determination there is an Acquiring Person, by a
nationally recognized investment banking firm, which determination
shall be described in a statement filed with the Rights Agent and
shall be conclusive for all purposes.
(ii) For the purpose of any computation hereunder, the
"current market price" per share of Preferred Stock shall be
determined in the same manner as set forth above for the Common
Stock in Section 11(d)(i) (other than the last sentence thereof).
If the current market price per share of Preferred Stock cannot
be determined in such manner, the "current market price" per
share of Preferred Stock shall be conclusively deemed to be an
amount equal to 100 (as such number may be appropriately adjusted
for such events as stock splits, stock dividends and
recapitalizations with respect to the Common Stock occurring
after the date of this Agreement) multiplied by the current
market price per share of Common Stock (as determined pursuant to
Section 11(d)(i) (other than the last sentence thereof)). If
neither the Common Stock nor the Preferred Stock is publicly held
or so listed or traded, the "current market price" per share of
the Preferred Stock shall be determined in the same manner as set
forth in the last sentence of Section 11(d)(i). For all purposes
of this Agreement, the "current market price" of one
one-hundredth of a share of Preferred Stock shall be equal to the
"current market price" of one share of Preferred Stock divided by
100.
(iii) For the purpose of any computation hereunder, the
value of any securities or assets other than Common Stock or
Preferred Stock shall be the fair value as determined in good
faith by the Board, or, if at the time of such determination
there is an Acquiring Person, by a nationally recognized
investment banking firm which determination shall be described in
a statement filed with the Rights Agent and shall be conclusive
for all purposes.
(e) Anything herein to the contrary notwithstanding, no
adjustment in the Purchase Price shall be required unless such
adjustment would require an increase or decrease of at least 1% in the
Purchase Price; provided 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 ten-thousandth of a share of Common Stock or other share or
one-millionth of a share of Preferred Stock, as the case may be.
(f) If at any time, as a result of an adjustment made pursuant to
Section 11(a)(ii) or Section 13(a), the holder of any Right shall be
entitled to receive upon exercise of such Right any shares of capital
stock other than Preferred Stock, thereafter the number of such other
shares so receivable upon exercise of any Right and the Purchase Price
thereof shall be subject to adjustment from time to time in a manner
and on terms as nearly equivalent as practicable to the provisions
with respect to the Preferred Stock contained in Section 11(a), 11(b),
11(c), 11(e), 11(g), 11(h), 11(i), 11(j), 11(k) and 11(m), and the
provisions of Sections 7, 9, 10, 13 and 14 with respect to the
Preferred Stock shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made hereunder shall evidence the right to purchase, at the
Purchase Price then in effect, the then applicable number of one
one-hundredths of a share of Preferred Stock and other capital stock
of the Company issuable from time to time hereunder upon exercise of
the Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as
provided in Section 11(i), upon each adjustment of the Purchase Price
as a result of the calculations made in Section 11(b) and 11(c), each
Right outstanding immediately prior to the making of such adjustment
shall thereafter evidence the right to purchase, at the adjusted
Purchase Price, that number of one one-hundredths of a share of
Preferred Stock (calculated to the nearest one-millionth) obtained by
(i) multiplying (x) the number of one one-hundredths of a share for
which a Right was exercisable immediately prior to this adjustment by
(y) the Purchase Price in effect immediately prior to such adjustment
of the Purchase Price and (ii) dividing the product so obtained by the
Purchase Price in effect immediately after such adjustment of the
Purchase Price.
(i) The Company may elect on or after the date of any adjustment
of the Purchase Price to adjust the number of Rights, in lieu of any
adjustment in the number of one one-hundredths of a share of Preferred
Stock issuable upon the exercise of a Right. Each of the Rights
outstanding after such adjustment of the number of Rights shall be
exercisable for the number of one one-hundredths of a share of
Preferred Stock for which such 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 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, 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 may bear, at the option of the Company, the adjusted
Purchase Price) and shall be registered in the names of the holders of
record of Right Certificates on the record date specified in the
public announcement.
(j) Irrespective of any adjustment or change in the Purchase
Price or the number of one one-hundredths 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 per one one-hundredth of a share and the number of shares which
were expressed in the initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an adjustment
reducing the Purchase Price below the par value, if any, of the number
of one one-hundredths of a share 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
such number of one one-hundredths of a share 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 issuance to the holder of any Right
exercised after such record date the number of one one-hundredths of a
share of Preferred Stock or other capital stock of the Company, if
any, issuable upon such exercise over and above the number of one
one-hundredths of a share of Preferred Stock or other capital stock of
the Company, if any, issuable upon such exercise on the basis of the
Purchase Price in effect prior to such adjustment; provided that the
Company shall deliver to such holder a due bill or other appropriate
instrument evidencing such holder's right to receive such additional
shares upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding,
the Company shall be entitled to make such reductions in the Purchase
Price, in addition to those adjustments expressly required by this
Section 11, as and to the extent that it, in its sole discretion,
shall determine to be advisable in order that any consolidation or
subdivision of the Preferred Stock, issuance wholly for cash of any
Preferred Stock at less than the current market price, issuance wholly
for cash of Preferred Stock or securities which by their terms are
convertible into or exercisable for Preferred Stock, stock dividends
or issuance of rights, options or warrants referred to in this Section
11, hereafter made by the Company to the holders of its Preferred
Stock, shall not be taxable to such shareholders.
(n) The Company covenants and agrees that it will not at any time
after the Distribution Date (i) consolidate, merge or otherwise
combine with or (ii) sell or otherwise transfer (and/or permit any of
its Subsidiaries to sell or otherwise transfer), in one transaction or
a series of related transactions, assets or earning power aggregating
more than 50% of the assets or earning power of the Company and its
Subsidiaries, taken as a whole, to any other Person or Persons if (x)
at the time of or immediately after such consolidation, merger,
combination or sale there are any rights, warrants or other
instruments or securities outstanding or any agreements or
arrangements in effect which would substantially diminish or otherwise
eliminate the benefits intended to be afforded by the Rights or (y)
prior to, simultaneously with or immediately after such consolidation,
merger, combination or sale, the shareholders of a Person who
constitutes, or would constitute, the "Principal Party" for the
purposes of Section 13 SHALL HAVE RECEIVED A DISTRIBUTION OF RIGHTS
PREVIOUSLY OWNED BY SUCH PERSON OR ANY OF ITS AFFILIATES AND
ASSOCIATES.
(o) The Company covenants and agrees that after the Distribution
Date, it will not, except as permitted by Sections 23, 24 and 27, take
(or permit any Subsidiary to take) any action if at the time such
action is taken it is reasonably foreseeable that such action will
substantially diminish or otherwise eliminate the benefits intended to
be afforded by the Rights.
(p) Notwithstanding anything in this Agreement to the contrary,
if at any time after the date hereof and prior to the Distribution
Date the Company shall (i) pay a dividend on the outstanding shares of
Common Stock payable in shares of Common Stock, (ii) subdivide the
outstanding Common Stock into a larger number of shares or (iii)
combine the outstanding Common Stock into a smaller number of shares,
the number of Rights associated with each share of Common Stock then
outstanding, or issued or delivered thereafter as contemplated by
Section 3(c), shall be proportionately adjusted so that the number of
Rights thereafter associated with each share of Common Stock following
any such event shall equal the result obtained by multiplying the
number of Rights associated with each share of Common Stock
immediately prior to such event by a fraction the numerator of which
shall be the total number of shares of Common Stock outstanding
immediately prior to the occurrence of the event and the denominator
of which shall be the total number of shares of Common Stock
outstanding immediately following the occurrence of such event.
SECTION 12. Certificate of Adjusted Purchase Price or Number of
Shares. Whenever an adjustment is made as provided in Sections 11
and 13, the Company shall (a) promptly prepare a certificate setting
forth such adjustment and a brief statement of the facts accounting
for such adjustment, (b) promptly file with the Rights Agent and with
each transfer agent for the Preferred Stock and the Common Stock a
copy of such certificate and (c) mail a brief summary thereof to each
holder of a Right Certificate (or, if prior to the Distribution Date,
to each holder of a certificate representing affected shares of Common
Stock) in the manner set forth in Section 26. The Rights Agent shall
be fully protected in relying on any such certificate and on any
adjustment therein contained.
SECTION 13. Consolidation, Merger or Sale or Transfer of Assets
or Earning Power. (a) If, following the occurrence of a Section
11(a)(ii) Event, directly or indirectly,
(x) the Company shall consolidate with, merge into, or
otherwise combine with, any other Person, and the Company shall
not be the continuing or surviving corporation of such
consolidation, merger or combination,
(y) any Person shall merge into, or otherwise combine
with, the Company, and the Company shall be the continuing or
surviving corporation of such merger or combination and, in
connection with such merger or combination, all or part of the
outstanding shares of Common Stock shall be changed into or
exchanged for other stock or securities of the Company or any
other Person, cash or any other property, or
(z) the Company and/or one or more of its Subsidiaries
shall sell or otherwise transfer, in one transaction or a series
of related transactions, assets or earning power aggregating more
than 50% of the assets or earning power of the Company and its
Subsidiaries, taken as a whole, to any other Person or Persons,
then, and in each such case, proper provision shall promptly be
made so that
(i) each holder of a Right shall thereafter be entitled
to receive, upon exercise thereof at the Purchase Price in effect
immediately prior to the first occurrence of a Section 11(a)(ii)
Event, such number of duly authorized, validly issued, fully paid
and nonassessable shares of freely tradeable Common Stock of the
Principal Party (as hereinafter defined), not subject to any
rights of call or first refusal, liens, encumbrances or other
claims, as shall be equal to the result obtained by dividing
(A) the product obtained by multiplying the
Purchase Price in effect immediately prior to the first
occurrence of a Section 11(a)(ii) Event by the number of one
one-hundredths of a share of Preferred Stock for which a
Right was exercisable immediately prior to such first
occurrence (such product being thereafter referred to as the
"PURCHASE PRICE" for each Right and for all purposes of this
Agreement) by
(B) 50% of the current market price
(determined pursuant to Section 11(d)(i)) per share of the
Common Stock of such Principal Party on the date of
consummation of such consolidation, merger, combination,
sale or transfer;
provided, however, that the Purchase Price (as so adjusted pursuant
to the foregoing clause (i)(A)) and the number of shares of Common
Stock of such Principal Party so receivable upon exercise of a Right
shall be subject to further adjustment as appropriate in accordance
with Section 11(f) to reflect any events occurring in respect of the
Common Stock of such Principal Party after the occurrence of such
consolidation, merger, sale or transfer;
(ii) the Principal Party shall thereafter be liable for,
and shall assume, by virtue of such consolidation, merger,
combination, 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 Principal Party, it being specifically intended
that the provisions of Section 11 shall apply only to such
Principal Party following the first occurrence of a Section 13
Event; and
(iv) such Principal Party shall take such steps
(including the authorization and reservation of a sufficient
number of shares of its Common Stock to permit exercise of all
outstanding Rights in accordance with this Section 13(a)) in
connection with the consummation of any such transaction as may
be necessary to assure that the provisions hereof shall
thereafter be applicable, as nearly as reasonably may be, in
relation to the shares of its Common Stock thereafter deliverable
upon the exercise of the Rights.
(b) "PRINCIPAL PARTY" means
(i) in the case of any transaction described in Section
13(a)(x) or (y), the Person that is the issuer of any securities
into which shares of Common Stock of the Company are converted in
such merger, consolidation or combination, and if no securities
are so issued, the Person that survives or results from such
merger, consolidation or combination; and
(ii) in the case of any transaction described in Section
13(a)(z), the Person that is the party receiving the greatest
portion of the assets or earning power transferred pursuant to
such transaction or transactions;
provided that in any such case, (A) if the Common Stock of such
Person is not at such time and has not been continuously over the
preceding 12-month period registered under Section 12 of the Exchange
Act, and such Person is a direct or indirect Subsidiary of another
Person the Common Stock of which is and has been so registered,
"Principal Party" shall refer to such other Person; and (B) in case
such Person is a Subsidiary, directly or indirectly, of more than one
Person, the Common Stocks of two or more of which are and have been so
registered, "Principal Party" shall refer to whichever of such Persons
is the issuer of the Common Stock having the greatest aggregate market
value.
(c) The Company shall not consummate any such consolidation,
merger, combination, sale or transfer unless the Principal Party shall
have a sufficient number of authorized shares of its Common Stock
which are not outstanding or otherwise reserved for issuance to permit
the exercise in full of the Rights in accordance with this Section 13
and unless prior thereto the Company and such Principal Party shall
have executed and delivered to the Rights Agent a supplemental
agreement providing for the terms set forth in Section 13(a) and 13(b)
and providing that, as soon as practicable after the date of any
consolidation, merger, combination, sale or transfer mentioned in
Section 13(a), the Principal Party will:
(i) prepare and file a registration statement under the
Securities Act with respect to the securities issuable upon
exercise of the Rights, and will use its best efforts to cause
such registration statement (A) to become effective as soon as
practicable after such filing and (B) to remain effective (with a
prospectus at all times meeting the requirements of the
Securities Act) until the Expiration Date; and
(ii) deliver to holders of the Rights historical
financial statements for the Principal Party and each of its
Affiliates which comply in all respects with the requirements for
registration on Form 10 under the Exchange Act.
SECTION 14. Fractional Rights and Fractional Shares. (a) The
Company shall not be required to issue fractions of Rights, except
prior to the Distribution Date as provided in Section 11(p), or to
distribute Right Certificates which evidence fractional Rights. In
lieu of any such fractional Rights, the Company shall pay to the
registered holders of the Right Certificates with regard to which such
fractional Rights would otherwise be issuable an amount in cash equal
to the same fraction of the current market price of a whole Right.
For purposes of this Section 14(a), the current market price of a
whole Right shall be the closing price of a Right for the Trading Day
immediately prior to the date on which such fractional Rights would
otherwise have been issuable. The closing price of a Right for any
day shall be the last sale price, regular way, or, in case no such
sale takes place on such day, the average of the closing bid and asked
prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to securities
listed or admitted to trading on the New York Stock Exchange or, if
the Rights are not listed or admitted to trading on the New York Stock
Exchange, 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. If on any
such date no such market maker is making a market in the Rights, the
current market price of the Rights on such date shall be as determined
in good faith by the Board, or, if at the time of such determination
there is an Acquiring Person, by a nationally recognized investment
banking firm.
(b) The Company shall not be required to issue fractions of
shares of Preferred Stock (other than fractions which are multiples of
one one-hundredth 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 multiples of one
one-hundredth of a share of Preferred Stock). In lieu of any such
fractional shares of Preferred Stock, the Company shall pay to the
registered holders of Right Certificates at the time such Rights are
exercised as herein provided an amount in cash equal to the same
fraction of the current market price of one one-hundredth of a share
of Preferred Stock. For purposes of this Section 14(b), the current
market price of one one-hundredth of a share of Preferred Stock shall
be one one-hundredth of the closing price of a share of Preferred
Stock (as determined pursuant to Section 11(d)) for the Trading Day
immediately prior to the date of such exercise.
(c) Following the occurrence of any Triggering Event or upon any
exchange pursuant to Section 24, the Company shall not be required to
issue fractions of shares of Common Stock upon exercise of the Rights
or to distribute certificates which evidence fractional shares of
Common Stock. In lieu of fractional shares of Common Stock, the
Company shall pay to the registered holders of Right Certificates at
the time such Rights are exercised or exchanged as herein provided an
amount in cash equal to the same fraction of the current market price
of a share of Common Stock. For purposes of this Section 14(c), the
current market price of a share of Common Stock shall be the closing
price of a share of Common Stock (as determined pursuant to Section
11(d)(i)) for the Trading Day immediately prior to the date of such
exercise or exchange.
(d) The holder of a Right by the acceptance of the Right
expressly waives his right to receive any fractional Rights or any
fractional shares upon exercise of a Right except as permitted by this
Section 14.
SECTION 15. Rights of Action. All rights of action in respect
of this Agreement are vested in the respective registered holders of
the Right Certificates (and, prior to the Distribution Date, the
registered holders of certificates representing Common Stock); and any
registered holder of any Right Certificate (or, prior to the
Distribution Date, of any certificate representing 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 any
certificate representing 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
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 or offices of the Rights
Agent designated for such purposes, duly endorsed or accompanied
by a proper instrument of transfer and with the appropriate forms
and certificates fully executed;
(c) subject to Sections 6 and 7, the Company and the
Rights Agent may deem and treat the Person in whose name a Right
Certificate (or, prior to the Distribution Date, a certificate
representing shares of Common Stock) is registered as the
absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the
Right Certificate or the certificate representing shares of
Common Stock made by anyone other than the Company or the Rights
Agent) for all purposes whatsoever, and neither the Company nor
the Rights Agent, subject to the last sentence of Section 7(d),
shall be affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the
contrary, neither the Company nor the Rights Agent shall have any
liability to any holder of a Right or other Person as a result of
its inability to perform any of its obligations under this
Agreement by reason of any preliminary or permanent injunction or
other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative
agency or commission, or any statute, rule, regulation or
executive order promulgated or enacted by any governmental
authority prohibiting or otherwise restraining performance of
such obligation; provided that the Company must use its best
efforts to have any such order, decree or ruling lifted or
otherwise overturned as soon as possible.
SECTION 17. Right Certificate Holder Not Deemed a Shareholder.
No holder, as such, of any Right Certificate shall be entitled to
vote, receive dividends or be deemed for any purpose the holder of the
shares of capital stock which may at any time be issuable on the
exercise of the Rights represented thereby, nor shall anything
contained herein or in any Right Certificate be construed to confer
upon the holder of any Right Certificate, as such, any of the rights
of a shareholder of the Company or any right to vote for the election
of directors or upon any matter submitted to shareholders at any
meeting thereof, or to give or withhold consent to any corporate
action, or to receive notice of meetings or other actions affecting
shareholders (except as provided in Section 25), or to receive
dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Right Certificate shall have been exercised
in accordance with the provisions hereof.
SECTION 18. Concerning the Rights Agent. (a) The Company
agrees to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on demand of
the Rights Agent, its reasonable expenses and counsel fees and
disbursements and other disbursements incurred in the execution or
administration of this Agreement and the exercise and performance of
its duties hereunder. The Company also agrees to indemnify the Rights
Agent for, and to hold it harmless against, any loss, liability, or
expense, incurred without negligence, bad faith or willful misconduct
on the part of the Rights Agent, for anything done or omitted by the
Rights Agent in connection with the administration of this Agreement
or the exercise or performance of its duties hereunder, including the
costs and expenses of defending against any claim of liability.
(b) The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or omitted
by it in connection with the administration of this Agreement or the
exercise or performance of its duties hereunder in reliance upon any
Right Certificate or certificate for Common Stock or for other
securities of the Company, instrument of assignment or transfer, power
of attorney, endorsement, affidavit, letter, notice, instruction,
direction, consent, certificate, statement, or other paper or document
believed by it to be genuine and to be signed, executed and, where
necessary, verified or acknowledged, by the proper Person or Persons.
SECTION 19. Merger or Consolidation or Change of Name of Rights
Agents. (a) Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights Agent
shall be a party, or any corporation succeeding to the corporate trust
or stock transfer business of the Rights Agent or any successor Rights
Agent, shall be the successor to the Rights Agent under this Agreement
without the execution or filing of any paper or any further act on the
part of any of the parties hereto; provided that such corporation
would be eligible for appointment as a successor Rights Agent under
the provisions of Section 21. 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 a predecessor Rights Agent and deliver such Right
Certificates so countersigned; and in case at that time any of the
Right Certificates shall not have been countersigned, any successor
Rights Agent may countersign such Right Certificates either in the
name of the predecessor Rights Agent or in the name of the successor
Rights Agent; and in all such cases such Right Certificates shall have
the full force provided in the Right Certificates and in this
Agreement.
(b) In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Right Certificates
so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, the Rights Agent may
countersign such Right Certificates either in its prior name or in its
changed name; and in all such cases such Right Certificates shall have
the full force provided in the Right Certificates and in this
Agreement.
SECTION 20. Duties of Rights Agent. The Rights Agent undertakes
the duties and obligations imposed by this Agreement upon the
following terms and conditions, by all of which the Company and the
holders of Right Certificates, by their acceptance thereof, shall be
bound:
(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 (including, without limitation, the
identity of any "Acquiring Person" and the determination of
"current market price") be proved or established by the Company
prior to taking, suffering or omitting to take any action
hereunder, such fact or matter (unless other evidence in respect
thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by a certificate signed by
the President and Chief Executive Officer and by the Treasurer or
any Assistant Treasurer or the Secretary or any Assistant
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, suffered or omitted in good faith by it
under the provisions of this Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable hereunder only for
its own gross negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained in
this Agreement or in the Right Certificates (except its
countersignature thereof) or be required to verify the same, but
all such statements and recitals are and shall be deemed to have
been made by the Company only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or
the execution and delivery hereof (except the due execution
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 7(d)) or any adjustment in the
terms of the Rights (including the manner, method or amount
thereof) provided for in Sections 3, 11, 13, 23 or 24, or the
ascertaining of the existence of facts that would require any
such adjustment (except with respect to the exercise of Rights
evidenced by Right Certificates after actual notice of any such
adjustment); nor shall it by any act hereunder be deemed to make
any representation or warranty as to the authorization or
reservation of any shares of Common Stock or Preferred Stock to
be issued pursuant to this Agreement or any Right Certificate or
as to whether any shares of Common Stock or Preferred Stock will,
when issued, be duly authorized, validly 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 the President and Chief Executive Officer,
or the Secretary or any Assistant Secretary or the Treasurer or
any Assistant 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, suffered
or omitted to be taken by it in good faith in accordance with
instructions of any such officer.
(h) The Rights Agent and any shareholder, director,
officer or employee of the Rights Agent may buy, sell or deal in
any of the Rights or other securities of the Company or become
pecuniarily interested in any transaction in which the Company
may be interested, or contract with or lend money to the Company
or otherwise act as fully and freely as though it were not the
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 Person.
(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 or to any holders of Rights
resulting from any such act, default, neglect or misconduct,
provided that reasonable care was exercised in the selection and
continued employment thereof.
(j) No provision of this Agreement shall require the
Rights Agent to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties
hereunder or in the exercise of its rights if there shall be
reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not
reasonably assured to it.
(k) If, with respect to any Right Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate attached to the form of assignment or form of
election to purchase, as the case may be, has either not been
completed or indicates an affirmative response to clause 1 or 2
thereof, the Rights Agent shall not take any further action with
respect to such requested exercise or transfer without first
consulting with the Company.
SECTION 21. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties
under this Agreement upon 30 days' notice in writing mailed to the
Company and to each transfer agent of the Common Stock and Preferred
Stock by registered or certified mail, and, subsequent to the
Distribution Date, to the holders of the Right Certificates by
first-class mail. The Company may remove the Rights Agent or any
successor Rights Agent upon 30 days' notice 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 and Preferred Stock by
registered or certified mail, and, subsequent to the Distribution
Date, to the holders of the Right Certificates by first-class mail.
If the Rights Agent shall resign or be removed or shall otherwise
become incapable of acting, the Company shall appoint a successor to
the Rights Agent. If the Company shall fail to make such appointment
within a period of 30 days after giving notice of such removal or
after it has been notified in writing of such resignation or
incapacity by the resigning or incapacitated Rights Agent or by the
holder of a Right Certificate (who shall, with such notice, submit his
Right Certificate for inspection by the Company), then the registered
holder of any Right Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any successor
Rights Agent, whether appointed by the Company or by such a court,
shall be (a) a corporation organized and doing business under the laws
of the United States or of any state of the United States, in good
standing, having a principal office in the State of New York, which is
authorized under such laws to exercise stock transfer or corporate
trust powers and is subject to supervision or examination by federal
or state authority and which has at the time of its appointment as
Rights Agent a combined capital and surplus of at least $50,000,000 or
(b) an Affiliate of a corporation described in clause 21(a). 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 and the Preferred Stock, and, subsequent to the
Distribution Date, mail a notice thereof in writing to the registered
holders of the Right Certificates. Failure to give any notice
provided for in this Section 21, 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 the Board to
reflect any adjustment or change in the Purchase Price and the number
or kind or class of shares of stock issuable upon exercise of the
Rights made in accordance with the provisions of this Agreement.
SECTION 23. Redemption. (a) The Board may, at its option, at
any time prior to the earlier of (i) the occurrence of a Section
11(a)(ii) Event and (ii) the Final Expiration Date, redeem all but not
less than all the then outstanding Rights at a redemption price of
$.01 per Right, as such amount may be appropriately adjusted to
reflect any stock split, stock dividend or similar transaction
occurring after the date hereof (such redemption price being
hereinafter referred to as the "REDEMPTION PRICE"). The redemption of
the Rights may be made effective at such time, on such basis and with
such conditions as the Board in its sole discretion may establish.
The Redemption Price shall be payable, at the option of the Company,
in cash, shares of Common Stock or such other form of consideration as
the Board shall determine.
(b) Immediately upon the action of the Board electing to redeem
the Rights (or at such later time as the Board may establish for the
effectiveness of such redemption), and without any further action and
without any notice, the right to exercise the Rights will terminate
and thereafter the only right of the holders of Rights shall be to
receive the Redemption Price for each Right so held. The Company
shall promptly thereafter give notice of such redemption to the Rights
Agent and the holders of the Rights in the manner set forth in Section
26; provided that the failure to give, or any defect in, such notice
shall not affect the validity of such redemption. 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.
SECTION 24. Exchange. (a) At any time after the occurrence of
a Section 11(a)(ii) Event, the Board may, at its option, exchange all
or part of the then outstanding and exercisable Rights (which shall
not include Rights that have become void pursuant to Section 7(d)) for
shares of Common Stock, at an exchange ratio of one share of Common
Stock per Right, appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after the date hereof
(such exchange ratio being hereinafter referred to as the "EXCHANGE
RATIO"). Notwithstanding the foregoing, the Board shall not be
empowered to effect such exchange at any time after an Acquiring
Person, together with all Affiliates and Associates of such Acquiring
Person, becomes the Beneficial Owner of 50% or more of the shares of
Common Stock then outstanding. From and after the occurrence of a
Section 13 Event, any Rights that theretofore have not been exchanged
pursuant to this Section 24(a) shall thereafter be exercisable only in
accordance with Section 13 and may not be exchanged pursuant to this
Section 24(a). The exchange of the Rights by the Board may be made
effective at such time, on such basis and with such conditions as the
Board in its sole discretion may establish.
(b) Immediately upon the effectiveness of the action of the Board
electing to exchange any Rights pursuant to Section 24(a) and without
any further action and without any notice, the right to exercise such
Rights will terminate and thereafter the only right of a holder of
such Rights shall be to receive that number of shares of Common Stock
equal to the number of such Rights held by such holder multiplied by
the Exchange Ratio. The Company shall promptly thereafter give notice
of such exchange to the Rights Agent and the holders of the Rights to
be exchanged in the manner set forth in Section 26; provided that the
failure to give, or any defect in, such notice shall not affect the
validity of such exchange. Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of exchange will state the
method by which the exchange of the shares of Common Stock for Rights
will be effected and, in the event of any partial exchange, the number
of Rights which will be exchanged. Any partial exchange shall be
effected pro rata based on the number of Rights (other than Rights
which have become void pursuant to Section 7(d)) held by each holder
of Rights.
(c) The Company may at its option substitute, and, in the event
that there shall not be sufficient shares of Common Stock issued but
not outstanding or authorized but unissued to permit the exchange of
Rights for Common Stock ordered in accordance with Section 24(a), the
Company shall substitute to the extent of such insufficiency, for each
share of Common Stock that would otherwise be issuable upon exchange
of a Right, a number of one-one hundredths of a share of Preferred
Stock such that the current market price (determined pursuant to
Section 11(d)) of such number of one-one hundredths of a share of
Preferred Stock is equal to the current market price (determined
pursuant to Section 11(d)) of one share of Common Stock, as the case
may be, as of the date of such exchange.
SECTION 25. Notice of Proposed Actions. (a) In case the
Company shall propose, at any time after the Distribution Date, (i) to
pay any dividend payable in stock of any class to the holders of
Preferred Stock or to make any other distribution to the holders of
Preferred Stock (other than a regular quarterly cash dividend out of
earnings or retained earnings of the Company), or (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, or
(iii) to effect any reclassification of its Preferred Stock (other
than a reclassification involving only the subdivision or combination
of outstanding shares of Preferred Stock) or (iv) to effect any
consolidation or merger with any other Person, or to effect and/or to
permit one or more of its Subsidiaries to effect any sale or other
transfer, in one transaction or a series of related transactions, of
assets or earning power aggregating more than 50% of the assets or
earning power of the Company and its Subsidiaries, taken as a whole,
to any other Person or Persons, or (v) to effect the liquidation,
dissolution or winding up of the Company, then, in each such case, the
Company shall give to each holder of a Right, to the extent feasible
and in accordance with Section 26, a notice of such proposed action,
which shall specify the record date for the purposes of any such
dividend, distribution or offering of rights or warrants, or the date
on which any 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 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 25(a)(i) or 25(a)(ii) above
at least 20 days prior to the record date for determining holders of
the Preferred Stock entitled to participate in such dividend,
distribution or offering, and in the case of any such other action, at
least 20 days prior to the date of the taking of such proposed action
or the date of participation therein by the holders of Preferred
Stock, whichever shall be the earlier. The failure to give notice
required by this Section or any defect therein shall not affect the
legality or validity of the action taken by the Company or the vote
upon any such action.
(b) Notwithstanding anything in this Agreement to the contrary,
prior to the Distribution Date a public filing by the Company with the
Securities and Exchange Commission shall constitute sufficient notice
to the holders of securities of the Company, including the Rights, for
purposes of this Agreement and no other notice need be given to such
holders.
(c) If a Triggering Event shall occur, then, in any such case,
(i) the Company shall as soon as practicable thereafter give to each
holder of a Right, in accordance with Section 26, a notice of the
occurrence of such event, which shall specify the event and the
consequences of the event to holders of Rights under Section 11(a)(ii)
or 13, as the case may be, and (ii) all references in Section 25(a) to
Preferred Stock shall be deemed thereafter to refer to Common Stock or
other capital stock, as the case may be.
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 to or on the Company shall be sufficiently given or made if
sent by first-class mail (postage prepaid) to the address of the
Company indicated on the signature page hereof or such other address
as the Company shall specify in writing to the Rights Agent. Subject
to the provisions of Section 21, any notice or demand authorized by
this Agreement to be given or made by the Company or by the holder of
any Right to or on the Rights Agent shall be sufficiently given or
made if sent by first-class mail (postage prepaid) to the address of
the Rights Agent indicated on the signature page hereof or such other
address as the Rights Agent shall specify in writing to the Company.
Notices or demands authorized by this Agreement to be given or made by
the Company or the Rights Agent to the holder of any Right Certificate
(or, prior to the Distribution Date, to the holder of any certificate
representing shares of Common Stock) shall be sufficiently given or
made if sent by first-class mail (postage prepaid) to the address of
such holder shown on the registry books of the Company.
SECTION 27. Supplements and Amendments. For so long as the
Rights are then redeemable, the Company may, and the Rights Agent
shall if the Company so directs, supplement or amend any provision of
this Agreement in any respect without the approval of any holders of
certificates representing shares of Common Stock. At any time when
the Rights are no longer redeemable, the Company may, and the Rights
Agent shall if the Company so directs, supplement or amend this
Agreement without the approval of any holders of Rights; provided,
however, that no such supplement or amendment may (a) adversely affect
the interests of the holders of Rights as such (other than an
Acquiring Person or an Affiliate or Associate of an Acquiring Person),
(b) cause this Agreement again to become amendable other than in
accordance with this sentence, or (c) cause the Rights again to become
redeemable. Upon the delivery of a certificate from an appropriate
officer of the Company which states that the proposed supplement or
amendment is in compliance with the terms of this Section, the Rights
Agent shall execute such supplement or amendment.
SECTION 28. Successors. All the covenants and provisions of
this Agreement by or for the benefit of the Company or the Rights
Agent shall bind and inure to the benefit of their respective
successors and assigns hereunder.
SECTION 29. Determinations and Actions by the Board, etc. For
all purposes of this Agreement, any calculation of the number of
shares of Common Stock outstanding at any particular time, including
for purposes of determining the particular percentage of such
outstanding shares of Common Stock of which any Person is the
Beneficial Owner, shall be made in accordance with the last sentence
of Rule 13d-3(d)(1)(i) under the Exchange Act as in effect on the date
of this Agreement. The Board shall have the exclusive power and
authority to administer this Agreement and to exercise all rights and
powers specifically granted to the Board or to the Company, or as may
be necessary or advisable in the administration of this Agreement,
including the right and power to (i) interpret the provisions of this
Agreement and (ii) make all determinations deemed necessary or
advisable for the administration of this Agreement (including a
determination to redeem or exchange or not to redeem or exchange the
Rights or to amend the Agreement).
SECTION 30. 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 certificates
representing the shares of 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 certificates representing the shares of Common
Stock).
SECTION 31. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or unenforceable,
the remainder of the terms, provisions, covenants and restrictions of
this Agreement shall remain in full force and effect and shall in no
way be affected, impaired or invalidated.
SECTION 32. Governing Law. This Agreement, each Right and each
Right Certificate issued hereunder shall be deemed to be a contract
made under the laws of the State of Louisiana and for all purposes
shall be governed by and construed in accordance with the laws of such
State applicable to contracts to be made and performed entirely within
such State, except that the rights and obligations of the Rights Agent
shall be governed by the laws of the State of North Carolina.
SECTION 33. Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all
purposes be deemed to be an original, and all such counterparts shall
together constitute one and the same instrument.
SECTION 34. Descriptive Headings. The captions herein are
included for convenience of reference only, do not constitute a part
of this Agreement and shall be ignored in the construction and
interpretation hereof.
<PAGE>
PAGE
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective authorized officers as of the
day and year first above written.
PICCADILLY CAFETERIAS, INC.
By: /s/ Ronald A. LaBorde
Name: Ronald A. LaBorde
Title: President and Chief Executive Officer
3232 S. Sherwood Forest Blvd.
Baton Rouge, LA 70821
Attention: Secretary
WACHOVIA BANK, N.A.
By: /s/ Deborah N. Keaton
Name: Deborah N. Keaton
Title: Vice President
301 North Church Street
Winston-Salem, NC 27101
Attention: Deborah N. Keaton
<PAGE>
PAGE
EXHIBIT A
FORM OF
ARTICLES OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
PICCADILLY CAFETERIAS, INC.
Piccadilly Cafeterias, Inc., a Louisiana corporation (the
"Corporation"), by and through its undersigned President and Secretary
and by authority of its Board of Directors, does hereby certify that:
Pursuant to the authority conferred upon the Board of Directors
by the Corporation's Articles of Incorporation and by Section 33(A) of
the Louisiana Business Corporation Law ("Louisiana Law"), and by
unanimous consent of the Corporation's Board of Directors on November
2, 1998, the Board of Directors adopted amendments to Article VI of
the Articles of Incorporation, by adding to the end of Article VI the
following provisions, which create a series of Preferred Stock in the
amount and having the designation, voting powers, preferences and
relative, participating, optional and other special rights and
qualifications, limitations and restrictions thereof as follows:
SECTION 1 . Designation and Number of Shares. The shares of
such series shall be designated as "Series A Participating Cumulative
Preferred Stock" (the "SERIES A PREFERRED STOCK"), and the number of
shares constituting such series shall be 500,000. Such number of
shares of the Series A Preferred Stock may be increased or decreased
by resolution of the Board of Directors; provided that no decrease
shall reduce the number of shares of Series A Preferred Stock to a
number less than the number of shares then outstanding plus the number
of shares issuable upon exercise or conversion of outstanding rights,
options or other securities issued by the Corporation.
SECTION 2. Dividends and Distributions.
(a) The holders of shares of Series A Preferred Stock shall be
entitled to receive, when, as and if declared by the Board of
Directors out of funds legally available for the purpose,
quarterly dividends payable on September 30, December 31, March
31 and June 30 of 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
any 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 and (ii) subject to the provision for
adjustment hereinafter set forth, 100 times the aggregate per
share amount of all cash dividends or other distributions and 100
times the aggregate per share amount of all non-cash dividends or
other distributions (other than (A) a dividend payable in shares
of Common Stock of the Corporation, no par value, (any such
Common Stock, the "COMMON STOCK") or (B) a subdivision of the
outstanding shares of Common Stock (by reclassification or
otherwise)), declared on the Common Stock since the immediately
preceding Quarterly Dividend Payment Date, or, with respect to
the first Quarterly Dividend Payment Date, since the first
issuance of any share or fraction of a share of Series A
Preferred Stock. If the Corporation shall at any time after
November 6, 1998 (the "RIGHTS DECLARATION DATE") pay any dividend
on Common Stock payable in shares of Common Stock or effect a
subdivision or combination of the outstanding shares of Common
Stock (by reclassification or otherwise) into a greater or lesser
number of shares of Common Stock, then in each such case the
amount to which holders of shares of Series A Preferred Stock
were entitled immediately prior to such event under clause
2(a)(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.
(b) The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in paragraph 2(a) above
immediately after it declares a dividend or distribution on the
Common Stock (other than as described in clauses 2(a)(ii)(A) and
2(a)(ii)(B) above); provided that if no dividend or distribution
shall have been declared on the Common Stock during the period
between any Quarterly Dividend Payment Date and the next
subsequent Quarterly Dividend Payment Date (or, with respect to
the first Quarterly Dividend Payment Date, the period between the
first issuance of any share or fraction of a share of Series A
Preferred Stock and such first 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.
(c) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such
shares of Series A Preferred Stock, unless the date of issue of
such shares is on or before the record date for the first
Quarterly Dividend Payment Date, in which case dividends on such
shares shall begin to accrue and be cumulative from the date of
issue of such shares, or unless the date of issue is a date after
the record date for the determination of holders of shares of
Series A Preferred Stock entitled to receive a quarterly dividend
and on or before such Quarterly Dividend Payment Date, in which
case 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 shares of 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 shares of Series
A Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall not be
more than 60 days prior to the date fixed for the payment
thereof.
SECTION 3. Voting Rights. In addition to any other voting
rights required by law, the holders of shares of Series A Preferred
Stock shall have the following voting rights:
(a) Subject to the provision for adjustment hereinafter set
forth, each share of Series A Preferred Stock shall entitle the
holder thereof to 100 votes on all matters submitted to a vote of
shareholders of the Corporation. If the Corporation shall at any
time after the Rights Declaration Date pay any dividend on Common
Stock payable in shares of Common Stock or effect a subdivision
or combination of the outstanding shares of Common Stock (by
reclassification or otherwise) into a greater or lesser number of
shares of Common Stock, then in each such case the number of
votes per share to which holders of shares of Series 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 shares of Common Stock outstanding
immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding
immediately prior to such event.
(b) Except as otherwise provided herein or by law, the holders
of shares of Series A Preferred Stock and the holders of shares
of Common Stock shall vote together as a single class on all
matters submitted to a vote of shareholders of the Corporation.
(c) (i) If at any time dividends on any Series A Preferred Stock
shall be in arrears in an amount equal to six quarterly dividends
thereon, the occurrence of such contingency shall mark the
beginning of a period (herein called a "DEFAULT PERIOD") which
shall extend until such time when all accrued and unpaid
dividends for all previous quarterly dividend periods and for the
current quarterly dividend period on all shares of Series A
Preferred Stock then outstanding shall have been declared and
paid or set apart for payment. During each default period, all
holders of Preferred Stock and any other series of Preferred
Stock then entitled as a class to elect directors, voting
together as a single class, irrespective of series, shall have
the right to elect two Directors.
(ii) During any default period, such voting right of the
holders of Series A Preferred Stock may be exercised initially
at a special meeting called pursuant to subparagraph 3(c)(iii)
hereof or at any annual meeting of shareholders, and thereafter
at annual meetings of shareholders; provided that neither such voting
right nor the right of the holders of any other series of
Preferred Stock, if any, to increase, in certain cases, the authorized
number of Directors shall be exercised unless the holders of 10% in
number of shares of Preferred Stock outstanding shall be present in
person or by proxy. The absence of a quorum of holders of Common
Stock shall not affect the exercise by holders of Preferred Stock of
such voting right. At any meeting at which holders of Preferred Stock
shall exercise such voting right initially during an existing default
period, they shall have the right, voting as a class, to elect
Directors to fill such vacancies, if any, in the Board of Directors
as may then exist up to two Directors or, if such right is
exercised at an annual meeting, to elect two Directors. If the number
which may be so elected at any special meeting does not amount to
the required number, the holders of the Preferred Stock shall have
the right to make such increase in the number of
Directors as shall be necessary to permit the election by them of the
required number. After the holders of the Preferred
Stock shall have exercised their right to elect Directors in any
default period and during the continuance of such period,
the number of Directors shall not be increased or decreased except
by vote of the holders of Preferred Stock as herein
provided or pursuant to the rights of any equity securities ranking
senior to or pari passu with the Series A Preferred Stock.
(iii) Unless the holders of Preferred Stock shall, during an
existing default period, have previously exercised their right to
elect Directors, the Board of Directors may order, or any shareholder
or shareholders owning in the aggregate not less than 10% of the total
number of shares of Preferred Stock outstanding, irrespective of
series, may request, the calling of a special meeting of holders of
Preferred Stock, which meeting shall thereupon be called by the
President and Chief Executive Officer or the Secretary of the
Corporation. Notice of such meeting and of any annual
meeting at which holders of Preferred Stock are entitled to vote
pursuant to this paragraph 3(c)(iii) shall be given to
each holder of record of Preferred Stock by mailing a copy of such
notice to him at his last address as the same appears
on the books of the Corporation. Such meeting shall be called for a
time not earlier than 20 days and not later than 60
days after such order or request or in default of the calling of such
meeting within 60 days after such order or request,
such meeting may be called on similar notice by any shareholder or
shareholders owning in the aggregate not less than 10%
of the total number of shares of Preferred Stock outstanding,
irrespective of series. Notwithstanding the provisions of
this paragraph 3(c)(iii), no such special meeting shall be called
during the period within 60 days immediately preceding
the date fixed for the next annual meeting of shareholders.
(iv) In any default period, the holders of Common Stock, and other
classes of stock of the Corporation if applicable, shall continue to
be entitled to elect the whole number of Directors until the holders
of Preferred Stock shall have exercised their right to elect two
Directors voting as a class, after the exercise of which right (x)
the Directors so elected by the holders of Preferred Stock shall
continue in office until their successors shall have been
elected by such holders or until the expiration of the default period,
and (y) any vacancy in the Board of Directors may
(except as provided in paragraph 3(c)(ii) hereof) be filled by vote
of a majority of the remaining Directors theretofore
elected by the holders of the class of stock which elected the
Director whose office shall have become vacant. References
in this paragraph 3(c) to Directors elected by the holders of a
particular class of stock shall include Directors elected
by such Directors to fill vacancies as provided in clause (y) of the
foregoing sentence.
(v) Immediately upon the expiration of a default period, (x) the
right of the holders of Preferred Stock as a class to elect Directors
shall cease, (y) the term of any Directors elected by the holders of
Preferred Stock as a class shall terminate, and (z) the number of
Directors shall be such number as may be provided for in the articles
of incorporation or bylaws irrespective of any increase made pursuant
to the provisions of paragraph 3(c)(ii) hereof (such
number being subject, however, to change thereafter in any manner
provided by law or in the articles of incorporation or
bylaws). Any vacancies in the Board of Directors effected by the
provisions of clauses (y) and (z) in the preceding
sentence may be filled by a majority of the remaining Directors.
(d) The Articles of Incorporation of the Corporation shall not
be amended in any manner (whether by merger or otherwise) so as
to adversely affect the powers, preferences or special rights of
the Series A Preferred Stock without the affirmative vote of the
holders of a majority of the outstanding shares of Series A
Preferred Stock, voting separately as a class.
(e) Except as otherwise provided herein, holders of Series A
Preferred Stock shall have no special voting rights, and their
consent shall not be required for taking any corporate action.
SECTION 4. Certain Restrictions.
(a) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided
in Section 2 are in arrears, thereafter and until all accrued and
unpaid dividends and distributions, whether or not declared, on
outstanding shares of Series A Preferred Stock shall have been
paid in full, the Corporation shall not:
(i) declare or pay dividends on, or make any other distributions on,
any shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred
Stock;
(ii) declare or pay dividends on, or make any other distributions
on, any shares of stock ranking on a parity (either as to dividends
or upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except dividends paid ratably on the Series A
Preferred Stock and all such other parity stock on which dividends
are payable or in arrears in proportion to the total amounts to which
the holders of all such shares are then entitled;
(iii) redeem, purchase or otherwise acquire for value any shares of
stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock; provided
that the Corporation may at any time redeem, purchase or otherwise
acquire shares of any such junior stock in exchange for shares of
stock of the Corporation ranking junior (as to dividends and upon
dissolution, liquidation or winding up) to the Series A Preferred
Stock; or
(iv) redeem, purchase or otherwise acquire for value any shares of
Series A Preferred Stock, or any shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or
winding up) 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 Series A
Preferred Stock and all such other parity stock upon such terms as
the Board of Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences
of the respective series and classes, shall determine in good faith
will result in fair and equitable treatment among the
respective series or classes.
(b) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for value any shares
of stock of the Corporation unless the Corporation could, under
paragraph 4(a), purchase or otherwise acquire such shares at such
time and in such manner.
SECTION 5. Reacquired Shares. Any shares of Series A Preferred
Stock redeemed, 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
become authorized but unissued shares of Preferred Stock without
designation as to series and may be reissued as part of a new series
of Preferred Stock to be created by resolution or resolutions of the
Board of Directors as permitted by the Articles of Incorporation or as
otherwise permitted under Louisiana Law.
SECTION 6. Liquidation, Dissolution and Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (1) to the holders of shares of stock
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 shares of Series A Preferred Stock shall
have received $0.01 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 shares 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 100 times the aggregate amount to be distributed
per share to holders of Common Stock, or (2) to the holders of stock
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
such other parity stock in proportion to the total amounts to which
the holders of all such shares are entitled upon such liquidation,
dissolution or winding up. If the Corporation shall at any time after
the Rights Declaration Date pay any dividend on Common Stock payable
in shares of Common Stock or effect a subdivision or combination of
the outstanding shares of Common Stock (by reclassification or
otherwise) into a greater or lesser number of shares of Common Stock,
then in each such case the aggregate amount to which holders of shares
of Series A Preferred Stock were entitled immediately prior to such
event under the proviso in clause (1) 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.
SECTION 7. Consolidation, Merger, Etc. If the Corporation
shall enter into any consolidation, merger, combination or other
transaction in which the shares of Common Stock are exchanged for or
changed into other stock or securities, cash or any other property,
then in any such case the shares of Series A Preferred Stock shall at
the same time be similarly exchanged for or changed into an amount per
share, subject to the provision for adjustment hereinafter set forth,
equal to 100 times the aggregate amount of stock, securities, cash or
any other property, as the case may be, into which or for which each
share of Common Stock is changed or exchanged. If the Corporation
shall at any time after the Rights Declaration Date pay any dividend
on Common Stock payable in shares of Common Stock or effect a
subdivision or combination of the outstanding shares of Common Stock
(by reclassification or otherwise) into a greater or lesser number of
shares of Common Stock, then in each such case the amount set forth
in the preceding sentence with respect to the exchange or change of
shares 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.
SECTION 8. No Redemption. The Series A Preferred Stock shall
not be redeemable.
SECTION 9. Rank. The Series A Preferred Stock shall rank
junior (as to dividends and upon liquidation, dissolution and winding
up) to all other series of the Corporation's preferred stock except
any series that specifically provides that such series shall rank
junior to the Series A Preferred Stock.
SECTION 10. Fractional Shares. Series A Preferred Stock may be
issued in fractions of a share which shall entitle the holder, in
proportion to such holder's fractional shares, to exercise voting
rights, receive dividends, participate in distributions and to have
the benefit of all other rights of holders of Series A Preferred
Stock.
<PAGE>
PAGE
IN WITNESS WHEREOF, we have executed and subscribed these
Articles of Amendment this 2nd day of November, 1998.
PICCADILLY CAFETERIAS, INC.
By: /s/ Ronald A. LaBorde
Ronald A. LaBorde, President
By: /s/ Mark L. Mestayer
Mark L. Mestayer, Secretary
<PAGE>
ACKNOWLEDGMENT
STATE OF LOUISIANA
PARISH OF EAST BATON ROUGE
BEFORE ME, the undersigned authority, personally came and appeared,
Ronald A. LaBorde and Mark L. Mestayer, the President and the Secretary,
respectively, of Piccadilly Cafeterias, Inc. and the persons who executed
the foregoing instrument in such capacities, and who, having been duly
sworn, acknowledge and declare in my presence and in the presence of the
undersigned witnesses, that they were authorized to and did execute the
foregoing instrument in their corporate capacities for Piccadilly
Cafeterias, Inc., as its and their free act and deed.
IN WITNESS WHEREOF, the appearers, witnesses and I have hereunto
affixed our hands on this 2nd day of November, 1998 at Baton Rouge,
Louisiana.
WITNESSES:
/s/ Anita B. Curran /s/ Ronald A. LaBorde
Ronald A. LaBorde
/s/ Ingrid Fritz /s/ Mark L. Mestayer
Mark L. Mestayer
/s/ Kelly C. Simoneaux
Notary Public
<PAGE>
PAGE
EXHIBIT B
[FORM OF RIGHT CERTIFICATE]
No. R- _______________ Rights
NOT EXERCISABLE AFTER THE EARLIER OF NOVEMBER 2, 2008 AND THE DATE
ON WHICH THE RIGHTS EVIDENCED HEREBY ARE REDEEMED OR EXCHANGED BY THE
COMPANY AS SET FORTH IN THE RIGHTS AGREEMENT. AS SET FORTH IN THE
RIGHTS AGREEMENT, RIGHTS ISSUED OR TRANSFERRED TO, OR HELD BY, ANY
PERSON WHO IS, WAS OR BECOMES AN ACQUIRING PERSON OR AN AFFILIATE OR
ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT),
WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR BY ANY
SUBSEQUENT HOLDER, MAY BE NULL AND VOID.
RIGHT CERTIFICATE
PICCADILLY CAFETERIAS, INC.
This Right Certificate certifies that ______________________, or
registered assigns, is the registered holder of the number of Rights
set forth above, each of which entitles the holder (upon the terms and
subject to the conditions set forth in the Rights Agreement dated as
of November 2, 1998 and as amended from time to time (the "RIGHTS
AGREEMENT") between Piccadilly Cafeterias, Inc., a Louisiana
corporation (the "COMPANY"), and Wachovia Bank, N.A. (the "RIGHTS
AGENT")) to purchase from the Company, at any time after the
Distribution Date and prior to the Expiration Date, one
one-hundredth[s] of a fully paid, nonassessable share of Series A
Participating Cumulative Preferred Stock (the "PREFERRED STOCK") of
the Company at a purchase price of $51.00 per one one-hundredth of a
share (the "PURCHASE PRICE"), payable in lawful money of the United
States of America, upon surrender of this Right Certificate, with the
form of election to purchase and related certificate duly executed,
and payment of the Purchase Price at an office of the Rights Agent
designated for such purpose.
Terms used herein and not otherwise defined herein have the
meanings assigned to them in the Rights Agreement.
The number of Rights evidenced by this Right Certificate (and the
number and kind of shares issuable upon exercise of each Right) and
the Purchase Price set forth above are as of ________, ____, and may
have been or in the future be adjusted as a result of the occurrence
of certain events, as more fully provided in the Rights Agreement.
Upon the occurrence of a Section 11(a)(ii) Event, if the Rights
evidenced by this Right Certificate are beneficially owned by (a) an
Acquiring Person or an Associate or Affiliate of an Acquiring Person,
(b) a transferee of an Acquiring Person (or any such Associate or
Affiliate) who becomes a transferee after the Acquiring Person becomes
such, or (c) under certain circumstances specified in the Rights
Agreement, a transferee of an Acquiring Person (or any such Associate
or Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such, such Rights shall become null and
void, and no holder hereof shall have any right with respect to such
Rights from and after the occurrence of such Section 11(a)(ii) Event.
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, which limitations of rights
include the temporary suspension of the exercisability of such Rights
under the specific circumstances set forth in the Rights Agreement.
Upon surrender at the principal office or offices of the Rights
Agent designated for such purpose and subject to the terms and
conditions set forth in the Rights Agreement, any Rights Certificate
or Certificates may be transferred or exchanged for another Rights
Certificate or Certificates evidencing a like number of Rights as the
Rights Certificate or Certificates surrendered.
Subject to the provisions of the Rights Agreement, the Board of
Directors of the Company may, at its option,
(a) at any time prior to the earlier of (i) the occurrence of a
Section 11(a)(ii) Event and (ii) the Final Expiration Date,
redeem all but not less than all the then outstanding Rights at a
redemption price of $.01 per Right; or
(b) at any time after any Person becomes an Acquiring Person
(but before such Person becomes the Beneficial Owner of 50% or
more of the shares of Common Stock then outstanding, exchange all
or part of the then outstanding Rights (other than Rights held by
the Acquiring Person and certain related Persons) for shares of
Common Stock at an exchange ratio of one share of Common Stock
per Right. If the Rights shall be exchanged in part, the holder
of this Right Certificate shall be entitled to receive upon
surrender hereof another Right Certificate or Certificates for
the number of whole Rights not exchanged.
No fractional shares of Preferred Stock are required to be issued
upon the exercise of any Right or Rights evidenced hereby (other than
fractions which are integral multiples of one one-hundredth of a share
of Preferred Stock, which may, at the election of the Company, be
evidenced by depositary receipts), but in lieu thereof a cash payment
will be made, as provided in the Rights Agreement. If this Right
Certificate shall be exercised in part, the holder shall be entitled
to receive upon surrender hereof another Right Certificate or
Certificates for the number of whole Rights not exercised.
No holder of this Right Certificate shall be entitled to vote,
receive dividends or be deemed for any purpose the holder of the
shares of capital stock 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 shareholder of the Company or any right to vote for
the election of directors or upon any matter submitted to shareholders
at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions
affecting shareholders (except as provided in the Rights Agreement),
or to receive dividends or subscription rights, or otherwise, until
the Right or Rights 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>
PAGE
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed under its corporate seal by its authorized officers.
Dated as of , 19__
PICCADILLY CAFETERIAS, INC.
By:
Title:
Countersigned:
WACHOVIA BANK, N.A.
as Rights Agent
By:
Authorized Signature
<PAGE>
PAGE
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(To be executed if the registered holder
desires to transfer the Right Certificate.)
FOR VALUE RECEIVED
hereby sells, assigns and transfers unto
(Please print name and address of transferee)
this Right Certificate, together with all right, title and interest
therein, and does hereby irrevocably constitute and appoint
______________________ Attorney, to transfer the within Right
Certificate on the books of the within-named Company, with full power
of substitution.
Dated: _____________________, 19__
Signature
Signature Guaranteed:
<PAGE>
PAGE
CERTIFICATE
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Right Certificate ___are
___are not being assigned by or on behalf of a Person who is or was an
Acquiring Person or an Affiliate or Associate of any such Acquiring
Person (as such terms are defined in the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it ___did ___did not acquire the Rights evidenced by this
Right Certificate from any Person who is, was or became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person.
Dated: __________, 19 __
Signature
The signatures to the foregoing Assignment and Certificate must
correspond to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement or
any change whatsoever.
<PAGE>
PAGE
FORM OF ELECTION TO PURCHASE
(To be executed if the registered holder desires to exercise Rights
represented by the Right Certificate.)
To: Piccadilly Cafeterias, Inc.
The undersigned hereby irrevocably elects to exercise
____________ Rights represented by this Right Certificate to purchase
shares of Preferred Stock issuable upon the exercise of the Rights (or
such other securities of the Company or of any other person which may
be issuable upon the exercise of the Rights) and requests that
certificates for such securities be issued in the name of and
delivered to:
Please insert social security
or other identifying number
(Please print name and address)
If such number of Rights shall not be all the Rights evidenced by
this Right Certificate, a new Right Certificate for the balance of
such Rights shall be registered in the name of and delivered to:
Please insert social security
or other identifying number
(Please print name and address)
Dated: ________________, 19__
Signature
Signature Guaranteed:
<PAGE>
PAGE
CERTIFICATE
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Right Certificate ___are
___are not being exercised by or on behalf of a Person who is or was
an Acquiring Person or an Affiliate or Associate of any such Acquiring
Person (as such terms are defined in the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it ___did ___did not acquire the Rights evidenced by this
Right Certificate from any Person who is, was or became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person.
Dated: ____________, 19 __
Signature
The signature to the foregoing Election to Purchase and Certificate
must correspond to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement or
any change whatsoever.
<PAGE>
PAGE
EXHIBIT C
AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS ISSUED OR TRANSFERRED TO,
OR HELD BY, ANY PERSON WHO IS, WAS OR BECOMES AN ACQUIRING PERSON OR
AN AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT), WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH
PERSON OR BY ANY SUBSEQUENT HOLDER, MAY BE NULL AND VOID.
SUMMARY OF RIGHTS
PICCADILLY CAFETERIAS, INC.
SHAREHOLDER RIGHTS PLAN
DATED NOVEMBER 2, 1998
(REPLACING PRIOR RIGHTS PLAN
THAT EXPIRED ON AUGUST 22, 1998)
Summary of Terms
FORM OF SECURITY The Board has declared a dividend of one
preferred stock purchase right for each
outstanding share of the Company's Common
Stock, payable to holders of record as of
the close of business on November 2, 1998
(each a "RIGHT" and collectively, the
"RIGHTS")
TRANSFER Prior to the Distribution Date{1}, the
Rights generally will be evidenced by the
certificates for and will be transferred
with the Common Stock, and the registered
holders of the Common Stock will be deemed
to be the registered holders of the Rights.
After the Distribution Date, the Rights Agent
will mail separate certificates evidencing the
Rights to each record holder of the Common Stock
as of the close of business on the Distribution
Date, and thereafter the Rights will be
transferable separately from the Common Stock.
EXERCISE Prior to the Distribution Date, the Rights will
not be exercisable.
After the Distribution Date, prior to the
occurrence of an event described below under
"Flip-In" and "Flip-Over", each Right will be
exercisable to purchase, for $51.00 (the
"PURCHASE PRICE"), one one-hundredth of a share
of Series A Participating Cumulative Preferred
Stock, no par value, of the Company.
FLIP-IN If any person or group (an "ACQUIRING PERSON")
becomes the beneficial owner of the Threshold
Percentage, then each Right (other than Rights
beneficially owned by the Acquiring Person and
certain affiliated persons) will entitle the
holder to purchase, for the Purchase Price, a
number of shares of the Company's Common Stock,
having a market value of twice the Purchase
Price. "THRESHOLD PERCENTAGE" means with respect
to any Person and its Affiliates and Associates
15% of all then-outstanding Common Stock.
FLIP-OVER If, after any person has become an Acquiring
Person, (1) the Company is involved in a merger
or other business combination in which the
Company is not the surviving corporation or its
Common Stock is exchanged for other securities or
assets or (2) the Company and/or one or more of
its subsidiaries sell or otherwise transfer
assets or earning power aggregating more than 50%
of the assets or earning power of the Company and
its subsidiaries, taken as a whole, then each
Right will entitle the holder to purchase, for
the Purchase Price, a number of shares of common
stock of the other party to such business
combination or sale (or in certain circumstances,
an affiliate) having a market value of twice the
Purchase Price.
EXCHANGE At any time after any person has become an
Acquiring Person (but before any person becomes
the beneficial owner of 50% or more of the
Company's Common Stock), the Board may exchange
all or part of the Rights (other than the Rights
beneficially owned by the Acquiring Person and
certain affiliated persons) for shares of Common
Stock at an exchange ratio of one share of Common
Stock per Right.
REDEMPTION The Board may redeem all of the Rights at a price
of $0.01 per Right at any time prior to the time
that any person becomes an Acquiring Person.
EXPIRATION The Rights will expire on November 2, 2008,
unless earlier exchanged or redeemed.
AMENDMENTS For so long as the Rights are redeemable, the
Rights Agreement may be amended in any respect.
At any time after the Rights are no longer
redeemable, the Rights Agreement may not be
amended in any respect that would adversely
affect the Rights holders (other than any
Acquiring Person and certain affiliated persons)
or cause the Rights again to become redeemable.
VOTING RIGHTS A rights holder has no rights as a shareholder of
the Company, including the right to vote and to
receive dividends.
ANTIDILUTION The Rights Agreement includes standard
PROVISIONS antidilution provisions designed to protect the
efficacy of the Rights.
TAXES While the dividend of the Rights will not be
taxable to shareholders or to the Company,
shareholders or the Company may, depending upon
the circumstances, recognize taxable income in
the event that the Rights become exercisable as
set forth above.
LEGEND Common stock certificates outstanding as of
November 2, 1998 contain a legend referring to
the rights governed by the Company's prior rights
agreement, which expired on August 22, 1998 (the
"Prior Rights"). These Prior Rights are no
longer effective, and the legend on the
outstanding common stock certificates pertaining
thereto should be disregarded. Common stock
certificates issued after November 2, 1998 will
contain a new legend referring to the Rights
discussed herein, in place of the prior legend.
With respect to currently outstanding common
stock certificates, the Rights discussed herein
will be evidenced by such certificates registered
in the names of the holders thereof, together
with a copy of this Summary of Rights,
notwithstanding the fact that the certificates
contain the prior legend rather than the new
legend referring to the Rights.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form
8-A. A copy of the Rights Agreement is available free of charge from
the Company. This summary description of the Rights does not purport
to be complete and is qualified in its entirety by reference to the
Rights Agreement, as amended from time to time, the complete terms of
which are hereby incorporated by reference.
**FOOTNOTES**
{1} Distribution Date generally means the earlier of:
(1) the 10th day after public announcement that any person or group has
become the beneficial owner of the Threshold Percentage; and
(2) the 10th business day after the date of the commencement of a tender
or exchange offer by any person which would, if consummated, result in
such person becoming the beneficial owner of the Threshold Percentage.
NEWS RELEASE
PICCADILLY CAFETERIAS, INC.
(NYSE:PIC)
FOR FURTHER INFORMATION CONTACT:
J. FRED JOHNSON
EXECUTIVE VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
FOR IMMEDIATE RELEASE
November 2, 1998
PICCADILLY CAFETERIAS, INC. DECLARES
REGULAR QUARTERLY DIVIDENDS AND ADOPTS SHAREHOLDER RIGHTS PLAN
BATON ROUGE, LOUISIANA, November 2, 1998--PICCADILLY CAFETERIAS, INC.
(NYSE:PIC) announced that the board of directors declared a regular quarterly
dividend of $.12 per share, payable January 4, 1999, on the common stock
outstanding to shareholders of record as of December 4, 1998.
The Company also announced today that its shareholders have elected Norman
C. Francis, Dale E. Redman and C. Ray Smith to three-year terms as members of
the board of directors. Mr. Francis is President of Xavier University of
Louisiana and a director of Entergy Corporation. Mr. Redman is Executive Vice
President, Chief Financial Officer and director of United Companies Financial
Corporation. Mr. Smith is a Tipton R. Snaveley Professor of Business
Administration at the Darden Graduate School of Business Administration,
University of Virginia and the Executive Director of Darden School Foundation.
Piccadilly also announced today that its board of directors has adopted an
updated Rights Plan to replace a Rights Plan originally adopted in Augst 1988,
which has expired. As with its previous Rights Plan, the new Rights Plan is
intended to protect shareholder interests in the event the Company becomes the
subject of a takeover initiative that would deny the Company's shareholders the
full value of their investment. Piccadilly has no knowledge that anyone is
considering a hostile takeover of the Company.
The Rights are intended to enable all shareholders to realize the long-term
value of their investment in Piccadilly. The Rights, which will be issued as a
dividend on November 6, 1998, to each common shareholder of record on November
2, 1998, will be exercisable only if a person acquires, or announces a tender
offer which would result in ownership of, 15 percent or more of the Company's
common stock. The initial exercise price will be $51.00 per Right. The Rights
will expire on November 2, 2008, unless redeemed or exchanged at an earlier
date. A summary of the updated rights plan will be sent to shareholders in the
near future.
Piccadilly operates 254 cafeterias, 13 quick-service restaurants and seven
Ralph & Kacoo's seafood restaurants. Operating units are located primarily in
the southeastern and mid-Atlantic United States.
