SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: December 3, 1997
(Date of earliest event reported)
D E E R E & C O M P A N Y
(Exact name of registrant as specified in charter)
DELAWARE
(State or other jurisdiction of incorporation)
1-4121
(Commission File Number)
36-2382580
(IRS Employer Identification No.)
John Deere Road
Moline, Illinois 61265
(Address of principal executive offices and zip code)
(309)765-8000
(Registrant's telephone number, including area code)
_______________________________________
(Former name or former address, if changed since last report.)
Page 1 of 71 pages.
The Exhibit Index appears at Page 4.
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Item 5. Other Events.
On December 3, 1997, the Board of Directors of Deere &
Company (the "Company") approved the extension of the benefits
afforded by the Company's existing rights plan by adopting a
new stockholder rights plan. The new plan, like the existing
plan, is intended to deter coercive or partial offers which
will not provide fair value to all stockholders and enhance the
Board's ability to represent all stockholders and thereby
maximize stockholder values.
Pursuant to the new Rights Agreement between the Company
and The Bank of New York, as Rights Agent (the "1997 Rights
Agreement"), one Right will be issued for each outstanding
share of Common Stock, $1 par value, of the Company on the day
of the expiration of the existing rights (December 31, 1997).
Each of the new Rights will entitle the registered holder to
purchase from the Company one three-hundredth of a share of
Series A Participating Preferred Stock, $1 par value, at a
price of $225 per one three-hundredth of a share. The Rights
generally will not become exercisable unless and until, among
other things, any person acquires 15% or more of the
outstanding stock. The new Rights are redeemable under certain
circumstances at $.01 per Right and will expire, unless earlier
redeemed or extended, on December 31, 2007.
The description and terms of the new Rights are set forth
in the 1997 Rights Agreement, a copy of which is filed herewith
and is incorporated herein by reference.
Separately, the Board also authorized the repurchase of up
to $1 billion of Deere & Company Common Stock. At the Company's
discretion, repurchases will be made from time to time in the
open market and through privately negotiated transactions.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
(4) Rights Agreement, dated as of December 3, 1997
between Deere & Company and The Bank of New York,
which includes as Exhibit A thereto, the Form of
Rights Certificate.
(99) Press release.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned hereto duly authorized.
DEERE & COMPANY
By: /s/ Frank S. Cottrell
---------------------
Frank S. Cottrell
Secretary
Dated: 3 December 1997
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EXHIBIT INDEX
Sequential
Number and Description of Exhibit Page Number
(4) Rights Agreement, dated as of December 3, Page 5
1997 between Deere & Company and The Bank
of New York, which includes as Exhibit A
thereto, the Form of Rights Certificate.
(99) Press release. Page 71
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EXHIBIT 4
- --------------------------------------------------------------
- --------------------------------------------------------------
DEERE & COMPANY
and
THE BANK OF NEW YORK
Rights Agent
--------------------------------
Rights Agreement
Dated as of December 3, 1997
- --------------------------------------------------------------
- --------------------------------------------------------------
5
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TABLE OF CONTENTS
Page
Section 1. Certain Definitions 9
Section 2. Appointment of Rights Agent 14
Section 3. Issue of Rights Certificates 14
Section 4. Form of Rights Certificates 17
Section 5. Countersignature and Registration 18
Section 6. Transfer, Split Up, Combination and Exchange 19
of Rights Certificates; Mutilated, Destroyed,
Lost or Stolen Rights Certificates
Section 7. Exercise of Rights; Purchase Price; Expiration 20
Date of Rights
Section 8. Cancellation and Destruction of Rights 23
Certificates
Section 9. Reservation and Availability of Capital Stock 23
Section 10. Preferred Stock Record Date 26
Section 11. Adjustment of Purchase Price, Number and 26
Kind of Shares or Number of Rights
Section 12. Certificate of Adjusted Purchase Price or 38
Number of Shares
Section 13. Consolidation, Merger or Sale or Transfer 38
of Assets or Earning Power
Section 14. Fractional Rights and Fractional Shares 42
Section 15. Rights of Action 44
Section 16. Agreement of Rights Holders 44
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Section 17. Rights Certificate Holder Not Deemed a 45
Stockholder
Section 18. Concerning the Rights Agent 45
Section 19. Merger or Consolidation or Change of 46
Name of Rights Agent
Section 20. Duties of Rights Agent 47
Section 21. Change of Rights Agent 50
Section 22. Issuance of New Rights Certificates 51
Section 23. Redemption and Termination 52
Section 24. Exchange. 53
Section 25. Notice of Certain Events 54
Section 26. Notices 55
Section 27. Supplements and Amendments 56
Section 28. Successors 57
Section 29. Determinations and Actions by the Board of 57
Directors, etc.
Section 30. Benefits of this Agreement 58
Section 31. Severability 58
Section 32. Governing Law 58
Section 33. Counterparts 59
Section 34. Descriptive Headings 59
Exhibit A - Form of Rights Certificate 60
Exhibit B - Form of Summary of Rights 67
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RIGHTS AGREEMENT
RIGHTS AGREEMENT, dated as of December 3, 1997 (the
"Agreement"), between Deere & Company, a Delaware corporation
(the "Company"), and The Bank of New York, a New York
corporation (the "Rights Agent").
W I T N E S S E T H
WHEREAS, on December 9, 1987 (the "1987 Rights Dividend
Declaration Date"), the Board of Directors of the Company
authorized the Rights Agreement, dated as of December 9, 1987,
as amended, between the Company and the Rights Agent thereunder
(the "1987 Agreement") and declared a dividend distribution of
one right (a "1987 Right") for each share of Common Stock (as
hereinafter defined) of the Company outstanding at the close of
business on December 31, 1987 (the "1987 Record Date"). Each
1987 Right representing the right to purchase one one-hundredth
of a share of Series A Participating Preferred Stock of the
Company;
WHEREAS, on December 3, 1997, the Board of Directors of the
Company determined it desirable and in the best interests of
the Company and its shareholders for the Company to extend the
benefits afforded by the 1987 Agreement and to implement such
extension by executing this Agreement;
WHEREAS, on December 3, 1997 (the "Rights Dividend
Declaration Date"), the Board of Directors of the Company
authorized and declared a dividend distribution of one Right
(as hereinafter defined) for each share of Common Stock
outstanding upon the close of business on December 31, 1997
(the "Record Date"), and has authorized the issuance of one
Right (as such number may hereinafter be adjusted pursuant to
the provisions of Section 11(p) hereof) for each share of
Common Stock issued (whether as an original issuance or from
the Company's treasury) between the Record Date and the
Distribution Date (as hereinafter defined) and in certain other
circumstances provided herein, each Right initially
representing the right to purchase one three-hundredth of a
share of Series A Participating Preferred Stock of the Company
upon the terms and subject to the conditions hereinafter set
forth (the "Rights");
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NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereby agree as
follows:
Section 1. Certain Definitions. For purposes of this
Agreement, the following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person who or
which, together with all Affiliates and Associates of such
Person, shall be the Beneficial Owner of fifteen percent (15%)
or more of the shares of Common Stock then outstanding, but
shall not include the (i) Company, (ii) any Subsidiary of the
Company, (iii) any employee benefit plan of the Company, or of
any Subsidiary of the Company, or any Person or entity
organized, appointed or established by the Company for or
pursuant to the terms of any such plan or (iv) any Person who
becomes the Beneficial Owner of fifteen percent (15%) or more
of the shares of Common Stock then outstanding as a result of a
reduction in the number of shares of Common Stock outstanding
due to the repurchase of shares of Common Stock by the Company
unless and until such Person, after becoming aware that such
Person has become the Beneficial Owner of fifteen percent (15%)
or more of the then outstanding shares of Common Stock,
acquires beneficial ownership of additional shares of Common
Stock representing one percent (1%) or more of the shares of
Common Stock then outstanding, or (v) any such Person who has
reported or is required to report such ownership (but less than
20%) on Schedule 13G under the Securities and Exchange Act of
1934, as amended and in effect on the date of the Agreement
(the "Exchange Act") (or any comparable or successor report) or
on Schedule 13D under the Exchange Act (or any comparable or
successor report) which Schedule 13D does not state any
intention to or reserve the right to control or influence the
management or policies of the Company or engage in any of the
actions specified in Item 4 of such schedule (other than the
disposition of the Common Stock) and, within 10 Business Days
of being requested by the Company to advise it regarding the
same, certifies to the Company that such Person acquired shares
of Common Stock in excess of 14.9% inadvertently or without
knowledge of the terms of the Rights and who, together with all
Affiliates and Associates, thereafter does not acquire
additional shares of Common Stock while the Beneficial Owner of
15% or more of the shares of Common Stock then outstanding;
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provided, however, that if the Person requested to so certify
fails to do so within 10 Business Days, then such Person shall
become an Acquiring Person immediately after such 10-Business-
Day period.
(b) "Act" shall mean the Securities Act of 1933.
(c) "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the
General Rules and Regulations under the Securities Exchange Act
of 1934, as amended and in effect on the date of this Agreement
(the "Exchange Act").
(d) A Person shall be deemed the "Beneficial Owner" of,
and shall be deemed to "beneficially own," any securities:
(i) which such Person or any of such Person's
Affiliates or Associates, directly or indirectly, has the right
to acquire (whether such right is exercisable immediately or
only after the passage of time) pursuant to any agreement,
arrangement or understanding (whether or not in writing) or
upon the exercise of conversion rights, exchange rights,
rights, warrants or options, or otherwise; 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 such Person or any of such
Person's Affiliates or Associates until such tendered
securities are accepted for purchase or exchange, (B)
securities issuable upon exercise of Rights at any time prior
to the occurrence of a Triggering Event (as hereinafter
defined), or (C) securities issuable upon exercise of Rights
from and after the occurrence of a Triggering Event which
Rights were acquired by such Person or any of such Person's
Affiliates or Associates prior to the Distribution Date (as
hereinafter defined) or pursuant to Section 3(a) or Section 22
hereof (the "Original Rights") or pursuant to Section 11(i)
hereof in connection with an adjustment made with respect to
any Original Rights;
(ii) which such Person or any of such Person's
Affiliates or Associates, directly or indirectly, has the right
to vote or dispose of or has "beneficial ownership" of (as
determined pursuant to Rule 13d-3 of the General Rules and
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Regulations under the Exchange Act), including pursuant to any
agreement, arrangement or understanding, whether or not in
writing; provided, however, that a Person shall not be deemed
the "Beneficial Owner" of, or to "beneficially own," any
security under this subparagraph (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 given in response to a public
proxy or consent solicitation made pursuant to, and in
accordance with, the applicable provisions of the General Rules
and Regulations under the Exchange Act, and (B) is not
reportable by such Person on Schedule 13D under the Exchange
Act (or any comparable or successor report); or
(iii) which are beneficially owned, directly or
indirectly, by any other Person (or any Affiliate or Associate
thereof) with which such Person (or any of such Person's
Affiliates or Associates) has any agreement, arrangement or
understanding (whether or not in writing), for the purpose of
acquiring, holding, voting (except pursuant to a revocable
proxy as described in the proviso to subparagraph (ii) of this
paragraph (d)) or disposing of any voting securities of the
Company; provided, however, that nothing in this paragraph (d)
shall cause a Person engaged in business as an underwriter of
securities to be the "Beneficial Owner" of, or to "beneficially
own," any securities acquired through such Person's
participation in good faith in a firm commitment underwriting
until the expiration of forty days after the date of such
acquisition, and then only if such securities continue to be
owned by such Person at such expiration of forty days.
(e) "Business Day" shall mean any day other than a
Saturday, Sunday or a day on which banking institutions in the
States of Illinois or New York are authorized or obligated by
law or executive order to close.
(f) "Close of business" on any given date shall mean
5:00 P.M., New York City time (or Chicago time for purposes of
Section 23 hereof), on such date; provided, however, that if
such date is not a Business Day it shall mean 5:00 P.M., New
York City time (or Chicago time for purposes of Section 23
hereof), on the next succeeding Business Day.
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(g) "Common Stock" shall mean the common stock, $1 par
value, of the Company, except that "Common Stock" when used
with reference to any Person other than the Company shall mean
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.
(h) "Common Stock Equivalents" shall have the meaning
set forth in Section 11(a)(iii) hereof.
(i) "Current market price" shall have the meaning set
forth in Section 11(d)(i) hereof.
(j) "Current Value" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(k) "Distribution Date" shall have the meaning set forth
in Section 3(a) hereof.
(l) "Equivalent Preferred Stock" shall have the meaning
set forth in Section 11(b) hereof.
(m) "Exchange Act" shall have the meaning set forth in
Section 1(c) hereof.
(n) "Exchange Ratio" shall have the meaning set forth in
Section 24 hereof.
(o) "Expiration Date" shall have the meaning set forth
in Section 7(a) hereof.
(p) "Final Expiration Date" shall have the meaning set
forth in Section 7(a) hereof.
(q) "Person" shall mean any individual, firm,
corporation, partnership or other entity.
(r) "Preferred Stock" shall mean shares of Series A
Participating Preferred Stock, $1 par value, of the Company
and, to the extent that there are not a sufficient number of
shares of Series A Participating Preferred Stock authorized to
permit the full exercise of the Rights, any other series of
Preferred Stock, $1 par value, of the Company designated for
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such purpose containing terms substantially similar to the
terms of the Series A Participating Preferred Stock.
(s) "Principal Party" shall have the meaning set forth
in Section 13(b) hereof.
(t) "Purchase Price" shall have the meaning set forth in
Section 4(a)(ii) hereof.
(u) "Record Date" shall have the meaning set forth in
the WHEREAS clause at the beginning of this Agreement.
(v) "Redemption Price" shall have the meaning set forth
in Section 23(a) hereof.
(w) "Rights" shall have the meaning set forth in the
WHEREAS clause at the beginning of this Agreement.
(x) "Rights Certificates" shall have the meaning set
forth in Section 3(a) hereof.
(y) "Rights Dividend Declaration Date" shall have the
meaning set forth in the WHEREAS clause at the beginning of
this Agreement.
(z) "Section 11(a)(ii) Event" shall mean any event
described in Section 11(a)(ii) hereof.
(aa) "Section 11(a)(ii) Trigger Date" shall have the
meaning set forth in Section 11(a)(iii) hereof.
(bb) "Section 13 Event" shall mean any event described
in clauses (x), (y) or (z) of Section 13(a) hereof.
(cc) "Spread" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(dd) "Stock Acquisition Date" shall mean the first date
of public announcement (which, for purposes of the definition,
shall include, without limitation, a report filed pursuant
Section 13(d) under the Exchange Act) by the Company or an
Acquiring Person that an Acquiring Person has become such.
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(ee) "Subsidiary" shall mean, with reference to any
Person, any corporation of which an amount of voting securities
sufficient to elect at least a majority of the directors of
such corporation is beneficially owned, directly or indirectly,
by such Person, or otherwise controlled by such Person.
(ff) "Substitution Period" shall have the meaning set
forth in Section 11(a)(iii) hereof.
(gg) "Summary of Rights" shall have the meaning set
forth in Section 3(b) hereof.
(hh) "Trading Day" shall have the meaning set forth in
Section 11(d)(i) hereof.
(ii) "Triggering Event" shall mean 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 (who, in accordance with
Section 3 hereof, shall prior to the Distribution Date also be
the holders of the Common Stock) in accordance with the terms
and conditions hereof, and the Rights Agent hereby accepts such
appointment. The Company may from time to time appoint such co-
rights agents as it may deem necessary or desirable. The Rights
Agent shall have no duty to supervise and shall, in no event,
be liable for the acts or omissions of any such co-rights
agent.
Section 3. Issue of Rights Certificates.
(a) Until the earlier of (i) the close of business on
the tenth day after the Stock Acquisition Date (or, if the
tenth day after the Stock Acquisition Date occurs before the
Record Date, the close of business on the Record Date), or (ii)
the close of business on the tenth business day (or such later
date as the Board shall determine) after the date that a tender
or exchange offer by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the
Company or of any Subsidiary of the Company, or any Person or
entity organized, appointed or established by the Company for
or pursuant to the terms of any such plan) is first published
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or sent or given within the meaning of Rule 14d-2(a) of the
General Rules and Regulations under the Exchange Act, if upon
consummation thereof, such Person would become an Acquiring
Person (the earlier of (i) and (ii) being herein referred to as
the "Distribution Date"), (x) the Rights will be evidenced
(subject to the provisions of paragraph (b) of this Section 3)
by the certificates for the Common Stock registered in the
names of the holders of the Common Stock (which certificates
for Common Stock shall be deemed also to be certificates for
Rights) and not by separate certificates, and (y) the Rights
will be transferable only in connection with the transfer of
the underlying shares of Common Stock (including a transfer to
the Company). The Company shall give the Rights Agent prompt
written notice of the Distribution Date. As soon as practicable
after the Distribution Date, and receipt of written notice of
such Distribution Date from the Company the Rights Agent will
send by such means as may be selected by the Company, to each
record holder of the Common Stock as of the close of business
on the Distribution Date, at the address of such holder shown
on the records of the Company, one or more rights certificates,
in substantially the form of Exhibit A hereto (the "Rights
Certificates"), evidencing one Right for each share of Common
Stock so held, subject to adjustment as provided herein. In the
event that an adjustment in the number of Rights per share of
Common Stock has been made pursuant to Section 11(p) hereof, at
the time of distribution of the Rights Certificates, the
Company shall make the necessary and appropriate rounding
adjustments (in accordance with Section 14(a) hereof) so that
Rights Certificates representing only whole numbers of Rights
are distributed and cash is paid in lieu of any fractional
Rights. As of and after the Distribution Date, the Rights will
be evidenced solely by such Rights Certificates.
(b) The Company will make available, as promptly as
practicable following the Record Date, a copy of a Summary of
Rights, in substantially the form attached hereto as Exhibit B
(the "Summary of Rights") to any holder who may so request from
time to time prior to the expiration Date. With respect to
certificates for the Common Stock outstanding as of the Record
Date, until the Distribution Date, the Rights will be evidenced
by such certificates for the Common Stock and the registered
holders of the Common Stock shall also be the registered
holders of the associated Rights. Until the earlier of the
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Distribution Date or the Expiration Date (as such term is
defined in Section (a) hereof), the transfer of any
certificates representing shares of Common Stock in respect of
which Rights have been issued shall also constitute the
transfer of the Rights associated with such shares of Common
Stock.
(c) Rights shall be issued in respect of all shares of
Common Stock which are issued (whether originally issued or
from the Company's treasury) after the Record Date but prior to
the earlier of the Distribution Date or the Expiration Date.
Certificates representing such shares of Common Stock shall
also be deemed to be certificates for Rights and shall bear the
following legend (or the legend required under the 1987
Agreement):
This certificate also evidences and entitles the holder
hereof to certain Rights as set forth in the Rights
Agreement between Deere & Company (the "Company") and the
Rights Agent thereunder (the "Rights Agreement"), the terms
of which are hereby incorporated herein by reference and a
copy of which is on file at the principal offices of the
Company. Under certain circumstances, as set forth in the
Rights Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this
certificate. The Company will mail to the holder of this
certificate a copy of the Rights Agreement, as in effect on
the date of mailing, without charge, promptly after receipt
of a written request therefor. Under certain circumstances
set forth in the Rights Agreement, Rights issued to, or
held by, any Person who is, was or becomes an Acquiring
Person or any 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 become null and void.
With respect to such certificates bearing the foregoing
legend (or the legend required under the 1987 Agreement), until
the earlier of (i) the Distribution Date or (ii) the Expiration
Date, the Rights associated with the Common Stock represented
by such certificates shall be evidenced by such certificates
alone and registered holders of Common Stock shall also be the
registered holders of the associated Rights, and the transfer
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of any of such certificates shall also constitute the transfer
of the Rights associated with the Common Stock represented by
such certificates.
Section 4. Form of Rights Certificates.
(a) The Rights Certificates (and the forms of election
to purchase and of assignment to be printed on the reverse
thereof) shall each be substantially in the form set forth in
Exhibit A hereto and may have such marks of identification or
designation and such legends, summaries or endorsements printed
thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may
be required to comply with any applicable law or with any rule
or regulation made pursuant thereto or with any rule or
regulation of any stock exchange on which the Rights may from
time to time be listed, or to conform to usage. The Rights
Certificates shall be in machine printable format in a form
satisfactory to the Rights Agent. Subject to the provisions of
Section 11 and Section 22 hereof, the Rights Certificates,
whenever distributed, shall be dated as of the Record Date and
on their face shall entitle the holders thereof to purchase
such number of one three-hundredths of a share of Preferred
Stock as shall be set forth therein at the price set forth
therein (such exercise price per one three-hundredth of a
share, the "Purchase Price"), but the amount and type of
securities purchasable upon the exercise of each Right and the
Purchase Price thereof shall be subject to adjustment as
provided herein.
(b) Any Rights Certificate issued pursuant to Section
3(a), Section 11(i) or Section 22 hereof that represents Rights
beneficially owned by: (i) an Acquiring Person or any
Associate or Affiliate of an Acquiring Person, (ii) a
transferee of an Acquiring Person (or of any such Associate or
Affiliate) who becomes a transferee after the Acquiring Person
becomes such, or (iii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee
prior to or concurrently with the Acquiring Person becoming
such and receives such Rights pursuant to either (A) a transfer
(whether or not for consideration) from the Acquiring Person to
holders of equity interests in such Acquiring Person or to any
Person with whom such Acquiring Person has any continuing
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agreement, arrangement or understanding regarding the
transferred Rights or (B) a transfer which the Board of
Directors of the Company has determined is part of a plan,
arrangement or understanding which has as a primary purpose or
effect avoidance of Section 7(e) hereof, and any Rights
Certificate issued pursuant to Section 6 or Section 11 hereof
upon transfer, exchange, replacement or adjustment of any other
Rights Certificate referred to in this sentence, shall contain
(to the extent feasible) the following legend:
The Rights represented by this Rights Certificate are or
were beneficially owned by a Person who was or became an
Acquiring Person or an Affiliate or Associate of an
Acquiring Person (as such terms are defined in the Rights
Agreement). Accordingly, this Rights Certificate and the
Rights represented hereby may become null and void in the
circumstances specified in Section 7(e) of such Agreement.
Section 5. Countersignature and Registration.
(a) The Rights Certificates shall be executed on behalf
of the Company by its Chairman of the Board, its President or
any Vice President, either manually or by facsimile signature,
and shall have affixed thereto the Company's seal or a
facsimile thereof which shall be attested by the Secretary or
an Assistant Secretary of the Company, either manually or by
facsimile signature. The Rights Certificates shall be
countersigned by the Rights Agent, either manually or by
facsimile signature, and shall not be valid for any purpose
unless so countersigned. In case any officer of the Company who
shall have signed any of the Rights Certificates shall cease to
be such officer of the Company before countersignature by the
Rights Agent and issuance and delivery by the Company, such
Rights Certificates, nevertheless, may be countersigned by the
Rights Agent and issued and delivered by the Company with the
same force and effect as though the person who signed such
Rights Certificates had not ceased to be such officer of the
Company; and any Rights Certificates may be signed on behalf of
the Company by any person who, at the actual date of the
execution of such Rights Certificate, shall be a proper officer
of the Company to sign such Rights Certificate, although at the
date of the execution of this Rights Agreement any such person
was not such an officer.
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(b) Following the Distribution Date, the Rights Agent
will keep or cause to be kept, at its principal office or
offices designated as the appropriate place for surrender of
Rights Certificates upon exercise or transfer, books for
registration and transfer of the Rights Certificates issued
hereunder. Such books shall show the names and addresses of the
respective holders of the Rights Certificates, the number of
Rights evidenced on its face by each of the Rights Certificates
and the date of each of the Rights Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of
Rights Certificates; Mutilated, Destroyed, Lost or Stolen
Rights Certificates.
(a) Subject to the provisions of Section 4(b), Section
7(e) and Section 14 hereof, at any time after the close of
business on the Distribution Date, and at or prior to the close
of business on the Expiration Date, any Rights Certificate or
Certificates (other than Rights Certificates representing
Rights that may have been exchanged pursuant to Section 24
hereof) may be transferred, split up, combined or exchanged for
another Rights Certificate or Certificates, entitling the
registered holder to purchase a like number of one three-
hundredths of a share of Preferred Stock (or, following a
Triggering Event, Common Stock, other securities, cash or other
assets, as the case may be) as the Rights Certificate or
Certificates surrendered then entitles such holder (or former
holder in the case of a transfer) to purchase. Any registered
holder desiring to transfer, split up, combine or exchange any
Rights Certificate or Certificates shall make such request in
writing delivered to the Rights Agent, and shall surrender the
Rights Certificate or Certificates to be transferred, split up,
combined or exchanged at the principal office or offices of the
Rights Agent designated for such purpose. Neither the Rights
Agent nor the Company shall be obligated to take any action
whatsoever with respect to the transfer of any such surrendered
Rights Certificate until the registered holder shall have
completed and signed the certificate contained in the form of
assignment on the reverse side of such Rights Certificate and
shall have provided such additional evidence of the identity of
the Beneficial Owner (or former Beneficial Owner) or Affiliates
or Associates thereof as the Company shall reasonably request.
Thereupon the Rights Agent shall, subject to Section 4(b),
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Section 7(e), Section 14 and Section 24 hereof, countersign and
deliver to the Person entitled thereto a Rights Certificate or
Rights Certificates, as the case may be, as so requested. The
Company may require payment of a sum sufficient to cover any
tax or governmental charge that may be imposed in connection
with any transfer, split up, combination or exchange of Rights
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 Rights Certificate, and, in case
of loss, theft or destruction, of indemnity or security
reasonably satisfactory to them, and reimbursement to the
Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender to the Rights Agent and
cancellation of the Rights Certificate if mutilated, the
Company will execute and deliver a new Rights Certificate of
like tenor to the Rights Agent for countersignature and
delivery to the registered owner in lieu of the Rights
Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration
Date of Rights.
(a) Subject to Section 7(e) hereof, at any time after
the Distribution Date the registered holder of any Rights
Certificate may exercise the Rights evidenced thereby (except
as otherwise provided herein including, without limitation, the
restrictions on exercisability set forth in Section 9(c),
Section 11(a)(iii) and Section 23(a) hereof) in whole or in
part upon surrender of the Rights Certificate, with the form of
election to purchase and the certificate on the reverse side
thereof duly executed, to the Rights Agent at the principal
office or offices of the Rights Agent designated for such
purpose, together with payment of the aggregate Purchase Price
with respect to the total number of one three-hundredths of a
share (or other securities, cash or other assets, as the case
may be) as to which such surrendered Rights are then
exercisable, at or prior to the earlier of (i) 5:00 P.M., New
York City time, on December 31, 2007, or such later date as may
be established by the Board of Directors prior to the
expiration of the Rights (such date, as it may be extended by
the Board, the "Final Expiration Date"), or (ii) the time at
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which the Rights are redeemed or exchanged as provided in
Section 23 and Section 24 hereof (the earlier of (i) and (ii)
being herein referred to as the "Expiration Date").
(b) The Purchase Price for each one three-hundredth of a
share of Preferred Stock pursuant to the exercise of a Right
shall initially be $225, and shall be subject to adjustment
from time to time as provided in Sections 11 and 13(a) hereof
and shall be payable in accordance with paragraph (c) below.
(c) Upon receipt of a Rights Certificate representing
exercisable Rights, with the form of election to purchase and
the certificate duly executed, accompanied by payment, with
respect to each Right so exercised, of the Purchase Price per
one three-hundredth of a share of Preferred Stock (or other
shares, securities, cash or other assets, as the case may be)
to be purchased as set forth below and an amount equal to any
applicable transfer tax, the Rights Agent shall, subject to
Section 20(k) hereof, thereupon promptly (i) (A) requisition
from any transfer agent of the shares of Preferred Stock (or
make available, if the Rights Agent is the transfer agent for
such shares) certificates for the total number of one three-
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 total number of shares of Preferred
Stock issuable upon exercise of the Rights hereunder with a
depositary agent, requisition from the depositary agent
depositary receipts representing such number of one three-
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 fractional shares in accordance with Section 14
hereof, (iii) after receipt of such certificates or depositary
receipts, cause the same to be delivered to or, upon the order
of the registered holder of such Rights Certificate, registered
in such name or names as may be designated by such holder, and
(iv) after receipt thereof, deliver such cash, if any, to or
upon the order of the registered holder of such Rights
Certificate. The payment of the Purchase Price (as such amount
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may be adjusted pursuant to Section 11(a)(iii) hereof) shall be
made in cash or by certified bank check or bank draft payable
to the order of the Company. In the event that the Company is
obligated to issue other securities (including Common Stock) of
the Company, pay cash and/or distribute other property pursuant
to Section 11(a) hereof, the Company will make all arrangements
necessary so that such other securities, cash and/or other
property are available for distribution by the Rights Agent, if
and when appropriate. The Company reserves the right to require
prior to the occurrence of a Triggering Event that, upon any
exercise of Rights, a number of Rights be exercised so that
only whole shares of Preferred Stock will be issued.
(d) In case the registered holder of any Rights
Certificate shall exercise less than all the Rights evidenced
thereby, a new Rights Certificate evidencing Rights equivalent
to the Rights remaining unexercised shall be issued by the
Rights Agent and delivered to, or upon the order of, the
registered holder of such Rights Certificate, registered in
such name or names as may be designated by such holder, subject
to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of a Section
11(a)(ii) Event, any Rights beneficially owned by (i) an
Acquiring Person or an Associate or Affiliate of an Acquiring
Person, (ii) a transferee of an Acquiring Person (or of any
such Associate or Affiliate) who becomes a transferee after the
Acquiring Person becomes such, or (iii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who
becomes a transferee prior to or concurrently with the
Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person to holders of equity
interests in such Acquiring Person or to any Person with whom
the Acquiring Person has any continuing agreement, arrangement
or understanding regarding the transferred Rights or (B) a
transfer which the Board of Directors of the Company has
determined is part of a plan, arrangement or understanding
which has as a primary purpose or effect the avoidance of this
Section 7(e), shall become null and void without any further
action and no holder of such Rights shall have any rights
whatsoever with respect to such Rights, whether under any
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provision of this Agreement or otherwise. The Company shall use
all reasonable efforts to insure that the provisions of this
Section 7(e) and Section 4(b) hereof are complied with, but
shall have no liability to any holder of Rights Certificates or
other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or its
Affiliates, Associates or transferees hereunder.
(f) 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 upon the occurrence of any purported exercise as set
forth in this Section 7 unless such registered holder shall
have (i) completed and signed the certificate contained in the
form of election to purchase set forth on the reverse side of
the Rights Certificate surrendered for such exercise, and (ii)
provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or
Associates thereof as the Company shall reasonably request.
Section 8. Cancellation and Destruction of Rights
Certificates. All Rights Certificates surrendered for the
purpose of exercise, transfer, split up, combination or
exchange shall, if surrendered to the Company or any of its
agents, be delivered to the Rights Agent for cancellation or in
cancelled form, or, if surrendered to the Rights Agent, shall
be cancelled by it, and no Rights Certificates shall be issued
in lieu thereof except as expressly permitted by any of the
provisions of this Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement, and the Rights
Agent shall so cancel and retire, any other Rights Certificate
purchased or acquired by the Company otherwise than upon the
exercise thereof. The Rights Agent shall deliver all cancelled
Rights Certificates to the Company, or shall, at the written
request of the Company, destroy such cancelled Rights
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 out of its authorized and
unissued shares of Preferred Stock (and, following the
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occurrence of a Triggering Event, out of its authorized and
unissued shares of Common Stock and/or other securities or out
of its authorized and issued shares held in its treasury), the
number of shares of Preferred Stock (and, following the
occurrence of a Triggering Event, Common Stock and/or other
securities) that, as provided in this Agreement including
Section 11(a)(iii) hereof, will be sufficient to permit the
exercise in full of all outstanding Rights.
(b) So long as the shares of Preferred Stock (and,
following the occurrence of a Triggering Event, Common Stock
and/or other securities) issuable and deliverable upon the
exercise of the 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
shares reserved for such issuance to be listed on such exchange
upon official notice of issuance upon such exercise.
(c) The Company shall use its best efforts to (i) file,
as soon as practicable following the earliest date after the
first occurrence of a Section 11(a)(ii) Event on which the
consideration to be delivered by the Company upon exercise of
the Rights has been determined in accordance with Section
11(a)(iii) hereof, a registration statement under the Act, with
respect to the securities purchasable upon exercise of the
Rights on an appropriate form, (ii) cause such registration
statement to become effective as soon as practicable after such
filing, and (iii) cause such registration statement to remain
effective (with a prospectus at all times meeting the
requirements of the Act) until the earlier of (A) the date as
of which the Rights are no longer exercisable for such
securities, and (B) the date of the expiration of the Rights.
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 ninety (90) days
after the date set forth in clause (i) of the first sentence of
this Section 9(c), 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
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announcement at such time as the suspension has been rescinded.
In addition, if the Company shall determine that a registration
statement is required following the Distribution Date, the
Company may temporarily suspend the exercisability of the
Rights until such time as a registration statement has been
declared effective. Notwithstanding any provision of this
Agreement to the contrary, the Rights shall not be exercisable
in any jurisdiction if the requisite qualification in such
jurisdiction shall not have been obtained, the exercise thereof
shall not be permitted under applicable law, or a necessary
registration statement shall not have been declared effective.
(d) The Company covenants and agrees that it will take
all such action as may be necessary to ensure that all one
three-hundredths of a share of Preferred Stock (and, following
the occurrence of a Triggering Event, Common Stock and/or other
securities) delivered upon exercise of Rights shall, at the
time of delivery of the certificates for such shares (subject
to payment of the Purchase Price), be duly and validly
authorized and issued and fully paid and non-assessable.
(e) The Company further covenants and agrees that it
will pay when due and payable any and all federal and state
transfer taxes and charges which may be payable in respect of
the issuance or delivery of the Rights Certificates and of any
certificates for a number of one three-hundredths of a share of
Preferred Stock (or Common Stock and/or other securities, as
the case may be) upon the exercise of Rights. The Company shall
not, however, be required to pay any transfer tax which may be
payable in respect of any transfer or delivery of Rights
Certificates to a Person other than, or the issuance or
delivery of a number of one three-hundredths of a share of
Preferred Stock (or Common Stock and/or other securities, as
the case may be) in respect of a name other than that of the
registered holder of the Rights Certificates evidencing Rights
surrendered for exercise or to issue or deliver any
certificates for a number of one three-hundredths of a share of
Preferred Stock (or Common Stock and/or other securities, as
the case may be) in a name other than that of the registered
holder upon the exercise of any Rights until such tax shall
have been paid (any such tax being payable by the holder of
such Rights Certificate at the time of surrender) or until it
has been established to the Company's satisfaction that no such
tax is due.
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Section 10. Preferred Stock Record Date. Each person in
whose name any certificate for a number of one three-hundredths
of a share of Preferred Stock (or Common Stock and/or other
securities, as the case may be) is issued upon the exercise of
Rights shall for all purposes be deemed to have become the
holder of record of such fractional shares of Preferred Stock
(or Common Stock and/or other securities, as the case may be)
represented thereby on, and such certificate shall be dated,
the date upon which the Rights Certificate evidencing such
Rights was duly surrendered and payment of the Purchase Price
(and all applicable transfer taxes) was made; provided,
however, that if the date of such surrender and payment is a
date upon which the Preferred Stock (or Common Stock and/or
other securities, as the case may be) transfer books of the
Company are closed, such Person shall be deemed to have become
the record holder of such shares (fractional or otherwise) on,
and such certificate shall be dated, the next succeeding
Business Day on which the Preferred Stock (or Common Stock
and/or other securities, as the case may be) transfer books of
the Company are open. Prior to the exercise of the Rights
evidenced thereby, the holder of a Rights Certificate shall not
be entitled to any rights of a stockholder of the Company with
respect to shares for which the Rights shall be exercisable,
including, without limitation, the right to vote, to receive
dividends or other distributions or to exercise any preemptive
rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price, Number and Kind
of Shares or Number of Rights. The Purchase Price, the number
and kind of shares covered by each Right and the number of
Rights outstanding are subject to adjustment from time to time
as provided in this Section 11.
(a) (i) In the event the Company shall at any time
after the date of this Agreement (A) declare a dividend on the
Preferred Stock payable in shares of Preferred Stock, (B)
subdivide the outstanding Preferred Stock, (C) combine the
outstanding Preferred Stock into a smaller number of 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 in which the Company
is the continuing or surviving corporation), except as
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otherwise provided in this Section 11(a) and Section 7(e)
hereof, the Purchase Price in effect at the time of the record
date for such dividend or of the effective date of such
subdivision, combination or reclassification, and the number
and kind of shares of Preferred Stock or capital stock, as the
case may be, issuable on such date, shall be proportionately
adjusted so that the holder of any Right exercised after such
time shall be entitled to receive, upon payment of the Purchase
Price then in effect, the aggregate number and kind of shares
of Preferred Stock or 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 Preferred Stock transfer books of the
Company were open, such holder would have owned upon such
exercise and been entitled to receive by virtue of such
dividend, subdivision, combination or reclassification. If an
event occurs which would require an adjustment under both this
Section 11(a)(i) and Section 11(a)(ii) hereof, the adjustment
provided for in this Section 11(a)(i) shall be in addition to,
and shall be made prior to, any adjustment required pursuant to
Section 11(a)(ii) hereof.
(ii) In the event any Person shall, at any time
after the Rights Dividend Declaration Date, become an Acquiring
Person, unless the event causing such Person to become an
Acquiring Person is a transaction set forth in Section 13(a)
hereof, or is an acquisition of shares of Common Stock pursuant
to a tender offer or an exchange offer for all outstanding
shares of Common Stock at a price and on terms determined by at
least a majority of the members of the Board of Directors who
are not officers of the Company and who are not
representatives, nominees, Affiliates or Associates of an
Acquiring Person, after receiving advice from one or more
investment banking firms, to be (a) at a price which is fair to
stockholders and not inadequate (taking into account all
factors which such members of the Board deem relevant,
including, without limitation, prices which could reasonably be
achieved if the Company or its assets were sold on an orderly
basis designed to realize maximum value) and (b) otherwise in
the best interests of the Company and its stockholders then,
promptly following the occurrence of such event, proper
provision shall be made so that each holder of a Right (except
as provided below and in Section 7(e) hereof) shall thereafter
have the right to receive, upon exercise thereof at the then
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current Purchase Price in accordance with the terms of this
Agreement, in lieu of a number of one three-hundredths of a
share of Preferred Stock, such number of shares of Common Stock
of the Company as shall equal the result obtained by (x)
multiplying the then current Purchase Price by the then number
of one three-hundredths of a share of Preferred Stock for which
a Right was exercisable immediately prior to the first
occurrence of a Section 11(a)(ii) Event, and (y) dividing that
product (which, following such first occurrence, shall
thereafter be referred to as the "Purchase Price" for each
Right and for all purposes of this Agreement) by 50% of the
Current Market Price (determined pursuant to Section 11(d)
hereof) per share of Common Stock on the date of such first
occurrence (such number of shares, the "Adjustment Shares").
(iii) In the event that the number of shares of
Common Stock which are authorized by the Company's Restated
Certificate of Incorporation, but which are not outstanding or
reserved for issuance for purposes other than upon exercise of
the Rights, are not sufficient to permit the exercise in full
of the Rights in accordance with the foregoing subparagraph
(ii) of this Section 11(a), the Company shall (A) determine the
value of the Adjustment Shares issuable upon the exercise of a
Right (the "Current Value"), and (B) with respect to each Right
(subject to Section 7(e) hereof), make adequate provision to
substitute for the Adjustment Shares, upon the exercise of a
Right and payment of the applicable Purchase Price, (1) cash,
(2) a reduction in the Purchase Price, (3) Common Stock or
other equity securities of the Company (including, without
limitation, shares, or units of shares, of preferred stock,
such as the Preferred Stock, which the Board has deemed to have
the essentially same value or economic rights as shares of
Common Stock (such shares of preferred stock being referred to
as "Common Stock Equivalents")), (4) debt securities of the
Company, (5) other assets, or (6) any combination of the
foregoing, having an aggregate value equal to the Current Value
(less the amount of any reduction in the Purchase Price), where
such aggregate value has been determined by the Board based
upon the advice of a nationally recognized investment banking
firm selected by the Board; provided, however, that if the
Company shall not have made adequate provision to deliver value
pursuant to clause (B) above within thirty (30) days following
the later of (x) the first occurrence of a Section 11(a)(ii)
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Event and (y) the date on which the Company's right of
redemption pursuant to Section 23(a) expires (the later of (x)
and (y) being referred to herein as the "Section 11(a)(ii)
Trigger Date"), then the Company shall be obligated to deliver,
upon the surrender for exercise of a Right and without
requiring payment of the Purchase Price, shares of Common Stock
(to the extent available) and then, if necessary, cash, which
shares and/or cash have an aggregate value equal to the Spread.
For purposes of the preceding sentence, the term "Spread" shall
mean the excess of (i) the Current Value over (ii) the Purchase
Price. If the Board determines in good faith that it is likely
that sufficient additional shares of Common Stock could be
authorized for issuance upon exercise in full of the Rights,
the thirty (30) day period set forth above may be extended to
the extent necessary, but not more than ninety (90) days after
the Section 11(a)(ii) Trigger Date, in order that the Company
may seek shareholder approval for the authorization of such
additional shares (such thirty (30) day period, as it may be
extended, is herein called the "Substitution Period"). To the
extent that action is to be taken pursuant to the first and/or
third sentences of this Section 11(a)(iii), the Company (1)
shall provide, subject to Section 7(e) hereof, that such action
shall apply uniformly to all outstanding Rights, and (2) may
suspend the exercisability of the Rights until the expiration
of the Substitution Period in order to seek such shareholder
approval for such authorization of additional shares and/or to
decide the appropriate form of distribution to be made pursuant
to such first sentence and to determine the value thereof. In
the event of any such suspension, the Company shall issue a
public announcement stating that the exercisability of the
Rights has been temporarily suspended, as well as a public
announcement at such time as the suspension is no longer in
effect. For purposes of this Section 11(a)(iii), the value of
each Adjustment Share shall be the current market price per
share of the Common Stock on the Section 11(a)(ii) Trigger Date
and the per share or per unit value of any Common Stock
Equivalent shall be deemed to equal the current market price
per share of the Common Stock on such date.
(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 forty-five (45) calendar days
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after such record date) Preferred Stock (or shares having the
same rights, privileges and preferences as the shares of
Preferred Stock ("Equivalent Preferred Stock")) or securities
convertible into Preferred Stock or Equivalent Preferred Stock
at a price per share of Preferred Stock or per share of
Equivalent Preferred Stock (or having a conversion price per
share, if a security convertible into Preferred Stock or
Equivalent Preferred Stock) less than the Current Market Price
(as determined pursuant to Section 11(d) hereof) 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 record 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 offering price of the total number of shares of
Preferred Stock and/or Equivalent Preferred Stock so to be
offered (and/or the aggregate initial conversion price of the
convertible securities so to be offered) would purchase at such
Current Market Price, and the denominator of which shall be the
number of shares of Preferred Stock outstanding on such record
date, plus the number of additional shares of Preferred Stock
and/or Equivalent Preferred Stock to be offered for
subscription or purchase (or into which the convertible
securities so to be offered are initially convertible). In case
such subscription price may be paid by delivery of
consideration part or all of which may be in a form other than
cash, the value of such consideration shall be as determined in
good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent and the
holders of the Rights. 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 in the event that such rights 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 a
distribution to all holders of Preferred Stock (including any
such distribution made in connection with a consolidation or
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merger in which the Company is the continuing corporation) of
evidences of indebtedness, cash (other than a regular quarterly
cash dividend out of the earnings or retained earnings of the
Company), assets (other than a dividend payable in Preferred
Stock, but including any dividend payable in stock other than
Preferred Stock) or evidences of indebtedness, or of
subscription rights or warrants (excluding those referred to in
Section 11(b) hereof), the Purchase Price to be in effect after
such record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the Current
Market Price (as determined pursuant to Section 11(d) hereof)
per share of Preferred Stock on such record date, less the fair
market value (as determined in good faith by the Board of
Directors of the Company, whose determination shall be
described in a statement filed with the Rights Agent) of the
portion of the cash, assets or evidences of indebtedness so to
be distributed or of such subscription rights or warrants
applicable to a share of Preferred Stock, and the denominator
of which shall be such Current Market Price (as determined
pursuant to Section 11(d) hereof) per share of Preferred Stock.
Such adjustments shall be made successively whenever such a
record date is fixed, and in the event that such distribution
is not so made, the Purchase Price shall be adjusted to be the
Purchase Price which would have been 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)
hereof, 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 thirty (30)
consecutive Trading Days immediately prior to such date, and
for purposes of computations made pursuant to Section
11(a)(iii) hereof, 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 ten
(10) consecutive Trading Days immediately following such date;
provided, however, that in the event that the Current Market
Price per share of the 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
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convertible into shares of such Common Stock (other than the
Rights), or (B) any subdivision, combination or
reclassification of such Common Stock, and the ex-dividend date
for such dividend or distribution, or the record date for such
subdivision, combination or reclassification shall not have
occurred prior to the commencement of the requisite thirty (30)
Trading Day or ten (10) Trading Day Period, as set forth above,
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
the shares of Common Stock are not listed or admitted to
trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with
respect to securities listed on the principal national
securities exchange on which the shares of Common Stock are
listed or admitted to trading or, if the 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 Automated Quotation System
("NASDAQ") or such other system then in use, or, if on any such
date the 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
the Common Stock selected by the Board. If on any such date no
market maker is making a market in the Common Stock, the fair
value of such shares on such date as determined in good faith
by the Board shall be used. The term "Trading Day" shall mean 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. If the Common
Stock is not publicly held or not so listed or traded, Current
Market Price per share shall mean the fair value per share 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.
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(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 clause (i) of this Section 11(d) (other than the last
sentence thereof). If the Current Market Price per share of
Preferred Stock cannot be determined in the manner provided
above or if the Preferred Stock is not publicly held or listed
or traded in a manner described in clause (i) of this Section
11(d), 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
the Common Stock. If neither the Common Stock nor the Preferred
Stock is publicly held or so listed or traded, Current Market
Price per share of the Preferred Stock shall mean the fair
value per share 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. For all
purposes of this Agreement, the Current Market Price of a Unit
shall be equal to the Current Market Price of one share of
Preferred Stock divided by 100.
(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
one percent (1%) in the Purchase Price; provided, however, that
any adjustments which by reason of this Section 11(e) are not
required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under
this Section 11 shall be made to the nearest cent or to the
nearest 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. Notwithstanding the first sentence of this Section
11(e), any adjustment required by this Section 11 shall be made
no later than the earlier of (i) three (3) years from the date
of the transaction which mandates such adjustment, or (ii) the
Expiration Date.
(f) If as a result of an adjustment made pursuant to
Section 11(a)(ii) or Section 13(a) hereof, the holder of any
Right thereafter exercised shall become entitled to receive any
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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 Sections 11(a), (b), (c), (e),
(g), (h), (i), (j), (k) and (m), and the provisions of Sections
7, 9, 10, 13 and 14 hereof with respect to the Preferred Stock
shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price
hereunder shall evidence the right to purchase, at the adjusted
Purchase Price, the number of one three-hundredths of a share
of Preferred Stock purchasable from time to time hereunder upon
exercise of the Rights, all subject to further adjustment as
provided herein.
(h) Unless the Company shall have exercised its election
as provided in Section 11(i), upon each adjustment of the
Purchase Price as a result of the calculations made in Sections
11(b) and (c), each Right outstanding immediately prior to the
making of such adjustment shall thereafter evidence the right
to purchase, at the adjusted Purchase Price, that number of one
three-hundredths of a share of Preferred Stock (calculated to
the nearest one-millionth) obtained by (i) multiplying (x) the
number of one three-hundredths of a share covered by a Right
immediately prior to this adjustment, by (y) the Purchase Price
in effect immediately prior to such adjustment of the Purchase
Price, and (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 three-
hundredths of a share of Preferred Stock purchasable upon the
exercise of a Right. Each of the Rights outstanding after the
adjustment in the number of Rights shall be exercisable for the
number of one three-hundredths of a share of Preferred Stock
for which a Right was exercisable immediately prior to such
adjustment. Each Right held of record prior to such adjustment
of the number of Rights shall become that number of Rights
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(calculated to the nearest one-ten-thousandth) obtained by
dividing the Purchase Price in effect immediately prior to
adjustment of the Purchase Price by the Purchase Price in
effect immediately after adjustment of the Purchase Price. The
Company shall make a public announcement of its election to
adjust the number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on
which the Purchase Price is adjusted or any day thereafter,
but, if the Rights Certificates have been issued, shall be at
least ten (10) days later than the date of the public
announcement. If Rights 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 Rights
Certificates on such record date Rights Certificates
evidencing, subject to Section 14 hereof, the additional Rights
to which such holders shall be entitled as a result of such
adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and
replacement for the Rights Certificates held by such holders
prior to the date of adjustment, and upon surrender thereof, if
required by the Company, new Rights Certificates evidencing all
the Rights to which such holders shall be entitled after such
adjustment. Rights 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 Rights 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 three-hundredths of a share
of Preferred Stock issuable upon the exercise of the Rights,
the Rights Certificates theretofore and thereafter issued may
continue to express the Purchase Price per one three-hundredth
of a share and the number of one three-hundredths of a share
which were expressed in the initial Rights Certificates issued
hereunder.
(k) Before taking any action that would cause an
adjustment reducing the Purchase Price below the then stated
value, if any, of the number of one three-hundredths of a share
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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 non-assessable
such number of one three-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 three-hundredths of a share of Preferred Stock and other
capital stock or securities of the Company, if any, issuable
upon such exercise over and above the number of one three-
hundredths of a share of Preferred Stock and other capital
stock or securities of the Company, if any, issuable upon such
exercise on the basis of the Purchase Price in effect prior to
such adjustment; provided, however, that the Company shall
deliver to such holder a due bill or other appropriate
instrument evidencing such holder's right to receive such
additional shares (fractional or otherwise) or securities 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 in their good faith judgment the Board of
Directors of the Company shall determine to be advisable in
order that any (i) consolidation or subdivision of the
Preferred Stock, (ii) issuance wholly for cash of any shares of
Preferred Stock at less than the Current Market Price, (iii)
issuance wholly for cash of shares of Preferred Stock or
securities which by their terms are convertible into or
exchangeable for shares of Preferred Stock, (iv) stock
dividends or (v) issuance of rights, options or warrants
referred to in this Section 11, hereafter made by the Company
to holders of its Preferred Stock shall not be taxable to such
stockholders.
(n) The Company covenants and agrees that it shall not,
at any time after the Distribution Date, (i) consolidate with
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any other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) hereof), (ii)
merge with or into any other Person (other than a Subsidiary of
the Company in a transaction which complies with Section 11(o)
hereof), or (iii) sell or transfer (or permit any Subsidiary to
sell or transfer), in one transaction, or a series of related
transactions, assets or earning power aggregating more than 50%
of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person or Persons
(other than the Company and/or any of its Subsidiaries in one
or more transactions each of which complies with Section 11(o)
hereof), if (x) at the time of or immediately after such
consolidation, merger or sale there are any rights, warrants or
other instruments or securities outstanding or agreements in
effect which would substantially diminish or otherwise
eliminate the benefits intended to be afforded by the Rights or
(y) prior to, simultaneously with or immediately after such
consolidation, merger or sale, the shareholders of the Person
who constitutes, or would constitute, the "Principal Party" for
purposes of Section 13(a) hereof shall have received a
distribution of Rights previously owned by such Person or any
of its Affiliates and Associates.
(o) The Company covenants and agrees that, after the
Distribution Date, it will not, except as permitted by Section
23 or Section 26 hereof, take (or permit any Subsidiary to
take) any action if at the time such action is taken it is
reasonably foreseeable that such action will diminish
substantially or otherwise eliminate the benefits intended to
be afforded by the Rights.
(p) Anything in this Agreement to the contrary
notwithstanding, in the event that the Company shall at any
time after the Rights Dividend Declaration Date and prior to
the Distribution Date (i) declare a dividend on the outstanding
shares of Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding shares of Common Stock, or (iii)
combine the outstanding shares of 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 but prior to the Distribution Date, shall be
proportionately adjusted so that the number of Rights
thereafter associated with each share of Common Stock following
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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
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
Section 11 and Section 13 hereof, 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) if a Distribution
Date has occurred, mail a brief summary thereof to each holder
of a Rights Certificate in accordance with Section 26 hereof.
The Rights Agent shall be fully protected in relying on any
such certificate and on any adjustment therein contained and
shall not be deemed to have knowledge of such adjustment unless
and until it shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power.
(a) In the event that, following the Stock Acquisition
Date, directly or indirectly, (x) the Company shall consolidate
with, or merge with and into, any other Person (other than a
Subsidiary of the Company in a transaction which complies with
Section 11(o) hereof), and the Company shall not be the
continuing or surviving corporation of such consolidation or
merger, (y) any Person (other than a Subsidiary of the Company
in a transaction which complies with Section 11(o) hereof)
shall consolidate with, or merge with or into, the Company, and
the Company shall be the continuing or surviving corporation of
such consolidation or merger and, in connection with such
consolidation or merger, all or part of the outstanding shares
of Common Stock shall be changed into or exchanged for stock or
other securities of any other Person or cash or any other
property, or (z) the Company shall sell or otherwise transfer
(or one or more of its Subsidiaries shall sell or otherwise
38
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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 Person or Persons (other
than the Company or any Subsidiary of the Company in one or
more transactions each of which complies with Section 11(o)
hereof), then, and in each such case (except as may be
contemplated by Section 13(d) hereof), proper provision shall
be made so that: (i) each holder of a Right, except as
provided in Section 7(e) hereof, shall thereafter have the
right to receive, upon the exercise thereof at the then current
Purchase Price in accordance with the terms of this Agreement,
such number of validly authorized and issued, fully paid, non-
assessable and freely tradable shares of Common Stock of the
Principal Party (as such term is hereinafter defined), not
subject to any liens, encumbrances, rights of first refusal or
other adverse claims, as shall be equal to the result obtained
by (1) multiplying the then current Purchase Price by the
number of one three-hundredths of a share of Preferred Stock
for which a Right is exercisable immediately prior to the first
occurrence of a Section 13 Event (or, if a Section 11(a)(ii)
Event has occurred prior to the first occurrence of a Section
13 Event, multiplying the number of such one three-hundredths
of a share for which a Right was exercisable immediately prior
to the first occurrence of a Section 11(a)(ii) Event by the
Purchase Price in effect immediately prior to such first
occurrence), and dividing that product (which, following the
first occurrence of a Section 13 Event, shall be referred to as
the "Purchase Price" for each Right and for all purposes of
this Agreement) by (2) 50% of the Current Market Price
(determined pursuant to Section 11(d)(i) hereof) per share of
the Common Stock of such Principal Party on the date of
consummation of such Section 13 Event; (ii) such Principal
Party shall thereafter be liable for, and shall assume, by
virtue of such Section 13 Event, all the obligations and duties
of the 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 hereof shall apply only to such Principal Party
following the first occurrence of a Section 13 Event; (iv) such
Principal Party shall take such steps (including, but not
limited to, the reservation of a sufficient number of shares of
its Common Stock) in connection with the consummation of any
such transaction as may be necessary to assure that the
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<PAGE>
provisions hereof shall thereafter be applicable, as nearly as
reasonably may be, in relation to its shares of Common Stock
thereafter deliverable upon the exercise of the Rights; and (v)
the provisions of Section 11(a)(ii) hereof shall be of no
effect following the first occurrence of any Section 13 Event.
(b) "Principal Party" shall mean:
(i) in the case of any transaction described in
clause (x) or (y) of the first sentence of Section 13(a), the
Person that is the issuer of any securities into which shares
of Common Stock of the Company are converted in such merger or
consolidation, and if no securities are so issued, the Person
that is the other party to such merger or consolidation; and
(ii) in the case of any transaction described in
clause (z) of the first sentence of Section 13(a), the Person
that is the party receiving the greatest portion of the assets
or earning power transferred pursuant to such transaction or
transactions;
provided, however, that in any such case, (1) if the Common
Stock of such Person is not at such time and has not been
continuously over the preceding twelve (12) month period
registered under Section 12 of the Exchange Act, and such
Person is a direct or indirect Subsidiary of another Person the
Common Stock of which is and has been so registered, "Principal
Party" shall refer to such other person; and (2) 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, sale or transfer unless the Principal
Party shall have a sufficient number of authorized shares of
its Common Stock which have not been issued or reserved for
issuance to permit the exercise in full of the Rights in
accordance with this Section 13 and unless prior thereto the
Company and such Principal Party shall have executed and
delivered to the Rights Agent a supplemental agreement
providing for the terms set forth in paragraphs (a) and (b) of
this Section 13 and further providing that, as soon as
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practicable after the date of any consolidation, merger or sale
of assets mentioned in paragraph (a) of this Section 13, the
Principal Party will
(i) prepare and file a registration statement under
the Act, with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form,
and will use its best efforts to cause such registration
statement to (A) become effective as soon as practicable after
such filing and (B) remain effective (with a prospectus at all
times meeting the requirements of the Act) until the Expiration
Date;
(ii) take all such other action as may be necessary
to enable the Principal Party to issue the securities
purchasable upon exercise of the Rights, including but not
limited to the registration or qualification of such securities
under all requisite securities laws of jurisdictions of the
various states and the listing of such securities on such
exchanges and trading markets as may be necessary or
appropriate; and
(iii) will 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.
The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other
transfers. In the event that a Section 13 Event shall occur at
any time after the occurrence of a Section 11(a)(ii) Event, the
Rights which have not theretofore been exercised shall
thereafter become exercisable in the manner described in
Section 13(a).
(d) Notwithstanding anything in this Agreement to the
contrary, Section 13 shall not be applicable to a transaction
described in subparagraphs (x) and (y) of Section 13(a) if (i)
such transaction is consummated with a Person or Persons who
acquired shares of Common Stock pursuant to a tender offer or
exchange offer for all outstanding shares of Common Stock which
complies with the provisions of Section 11(a)(ii) hereof (or a
wholly owned subsidiary of any such Person or Persons), (ii)
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the price per share of Common Stock offered in such transaction
is not less than the price per share of Common Stock paid to
all holders of shares of Common Stock whose shares were
purchased pursuant to such tender offer or exchange offer, and
(iii) the form of consideration being offered to the remaining
holders of shares of Common Stock pursuant to such transaction
is the same as the form of consideration paid pursuant to such
tender offer or exchange offer. Upon consummation of any such
transaction contemplated by this Section 13(d), all Rights
hereunder shall expire.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue fractions
of Rights, except prior to the Distribution Date as provided in
Section 11(p) hereof, or to distribute Rights Certificates
which evidence fractional Rights. In lieu of such fractional
Rights, the Company shall pay to the registered holders of the
Rights Certificates with regard to which such fractional Rights
would otherwise be issuable, an amount in cash equal to the
same fraction of the current market value of a whole Right. For
purposes of this Section 14(a), the current market value of a
whole Right shall be the closing price of the Rights for the
Trading Day immediately prior to the date on which such
fractional Rights would have been otherwise issuable. The
closing price of the Rights for any day shall be the last sale
price, regular way, or, in case no such sale takes place on
such day, the average of the closing bid and asked prices,
regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to
securities listed or admitted to trading on the New York Stock
Exchange or, if the Rights are not listed or admitted to
trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with
respect to securities listed on the principal national
securities exchange on which the Rights are listed or admitted
to trading, or if the Rights are not listed or admitted to
trading on any national securities exchange, the last quoted
price or, if not so quoted, the average of the high bid and low
asked prices in the over-the-counter market, as reported by
NASDAQ or such other system then in use or, if on any such date
the Rights are not quoted by any such organization, the average
of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights,
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selected by the Board of Directors of the Company. If on any
such date no such market maker is making a market in the
Rights, the fair value of the Rights on such date as determined
in good faith by the Board of Directors of the Company shall be
used.
(b) the Company shall not be required to issue fractions
of shares of Preferred Stock (other than fractions which are
integral multiples of one three-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 integral multiples of one
three-hundredth of a share of Preferred Stock). In lieu of
fractional shares of Preferred Stock that are not integral
multiples of one three-hundredth of a share of Preferred Stock,
the Company may pay to the registered holders of Rights
Certificates at the time such Rights are exercised as herein
provided an amount in cash equal to the same fraction of the
current market value of one three-hundredth of a share of
Preferred Stock. For purposes of this Section 14(b), the
current market value of one three-hundredth of a share of
Preferred Stock shall be one three-hundredth of the closing
price of a share of Preferred Stock (as determined pursuant to
Section 11(d)(ii) hereof) for the Trading Day immediately prior
to the date of such exercise.
(c) Following the occurrence of a Triggering Event, 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 may
pay to the registered holders of Rights Certificates at the
time such Rights are exercised as herein provided an amount in
cash equal to the same fraction of the current market value of
one (1) share of Common Stock. For purposes of this Section
14(c), the current market value of one share of Common Stock
shall be the closing price of one share of Common Stock (as
determined pursuant to Section 11(d)(i) hereof) for the Trading
Day immediately prior to the date of such exercise.
(d) The holder of a Right by the acceptance of the
Rights 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.
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Section 15. Rights of Action. All rights of action in
respect of this Agreement are vested in the respective
registered holders of the Rights Certificates (and, prior to
the Distribution Date, the registered holders of the Common
Stock); and any registered holder of any Rights Certificate
(or, prior to the Distribution Date, of the Common Stock),
without the consent of the Rights Agent or of the holder of any
other Rights Certificate (or, prior to the Distribution Date,
of the Common Stock), may, in his own behalf and for his own
benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Company to enforce, or
otherwise act in respect of, his right to exercise the Rights
evidenced by such Rights Certificate in the manner provided in
such Rights Certificate and in this Agreement. Without limiting
the foregoing or any remedies available to the holders of
Rights, it is specifically acknowledged that the holders of
Rights would not have an adequate remedy at law for any breach
of this Agreement and shall be entitled to specific performance
of the obligations hereunder and injunctive relief against
actual or threatened violations of the obligations hereunder of
any Person subject to this Agreement.
Section 16. Agreement of Rights Holders. Every holder of
a Right by accepting the same consents and agrees with the
Company and the Rights Agent and with every other holder of a
Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of Common
Stock;
(b) after the Distribution Date, the Rights 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 Section 6(a) and Section 7(f) hereof, the
Company and the Rights Agent may deem and treat the person in
whose name a Rights Certificate (or, prior to the Distribution
Date, the associated Common Stock certificate) is registered as
the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the
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Rights Certificates or the associated Common Stock certificate
made by anyone other than the Company or the Rights Agent) for
all purposes whatsoever, and neither the Company nor the Rights
Agent, subject to the last sentence of Section 7(e) hereof,
shall be required to be affected by any notice to the contrary;
and
(d) notwithstanding anything in this Agreement to the
contrary, neither the Company nor the Rights Agent shall have
any liability to any holder of a Right or other Person as a
result of its inability to perform any of its obligations under
this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court
of competent jurisdiction or by a governmental, regulatory or
administrative agency or commission, or any statute, rule,
regulation or executive order promulgated or enacted by any
governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, 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. Rights Certificate Holder Not Deemed a
Stockholder. No holder, as such, of any Rights Certificate
shall be entitled to vote, receive dividends or be deemed for
any purpose the holder of the number of one three-hundredths of
a share of Preferred Stock or any other securities of the
Company which may at any time be issuable on the exercise of
the Rights represented thereby, nor shall anything contained
herein or in any Rights Certificate be construed to confer upon
the holder of any Rights Certificate, as such, any of the
rights of a stockholder of the Company or any right to vote for
the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of
meetings or other actions affecting stockholders (except as
provided in Section 25 hereof), or to receive dividends or
subscription rights, or otherwise, until the Right or Rights
evidenced by such Rights 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
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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
administration and execution of this Agreement and the exercise
and performance of its duties hereunder. The Company also
agrees to indemnify the Rights Agent for, and to hold it
harmless against, any loss, liability, or expense, incurred
without negligence, bad faith or willful misconduct on the part
of the Rights Agent, for anything done or omitted by the Rights
Agent in connection with the acceptance and administration of
this Agreement, including the costs and expenses of defending
against any claim of liability in the premises.
(b) The Rights Agent shall be protected and shall incur
no liability for or in respect of any action taken, suffered or
omitted by it in connection with its administration of this
Agreement in reliance upon any Rights 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, direction,
consent, certificate, statement, or other paper or document
believed by it to be genuine and to be signed, executed and,
where necessary, verified or acknowledged, by the proper Person
or Persons.
Section 19. Merger or Consolidation or Change of Name of
Rights Agent.
(a) Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to all,
or substantially all, the corporate trust, stock transfer or
other shareholder services 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; but only if such corporation would be eligible for
appointment as a successor Rights Agent under the provisions of
Section 21 hereof. In case at the time such successor Rights
Agent shall succeed to the agency created by this Agreement,
any of the Rights Certificates shall have been countersigned
but not delivered, any such successor Rights Agent may adopt
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the countersignature of a predecessor Rights Agent and deliver
such Rights Certificates so countersigned; and in case at that
time any of the Rights Certificates shall not have been
countersigned, any successor Rights Agent may countersign such
Rights Certificates either in the name of the predecessor or in
the name of the successor Rights Agent; and in all such cases
such Rights Certificates shall have the full force provided in
the Rights 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 Rights
Certificates shall have been countersigned but not delivered,
the Rights Agent may adopt the countersignature under its prior
name and deliver Rights Certificates so countersigned; and in
case at that time any of the Rights Certificates shall not have
been countersigned, the Rights Agent may countersign such
Rights Certificates either in its prior name or in its changed
name; and in all such cases such Rights Certificates shall have
the full force provided in the Rights 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 Rights 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 or suffering any action hereunder, such fact or
matter (unless other evidence in respect thereof be herein
specifically prescribed) may be deemed to be conclusively
proved and established by a certificate signed by the Chairman
of the Board, the President, any Vice President, the Treasurer,
any Assistant Treasurer, the Secretary or any Assistant
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Secretary of the Company and delivered to the Rights Agent; and
such certificate shall be full authorization to the Rights
Agent for any action taken or suffered in good faith by it
under the provisions of this Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable hereunder only for
its own 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 Rights Certificates or be required
to verify the same (except as to its countersignature on such
Rights Certificates), 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 Rights 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 Rights Certificate; nor shall it be
responsible for any adjustment required under the provisions of
Section 11, Section 13 or Section 24 hereof or responsible for
the manner, method or amount of any such adjustment or the
ascertaining of the existence of facts that would require any
such adjustment (except with respect to the exercise of Rights
evidenced by Rights 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 Rights
Certificate or as to whether any shares of Common Stock or
Preferred Stock will, when so issued, be validly authorized and
issued, fully paid and non-assessable.
(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.
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(g) The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its
duties hereunder from the Chairman of the Board, the President,
any Vice President, the Secretary, any Assistant Secretary, 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 or suffered to be taken by it in good faith in accordance
with instructions of any such officer.
(h) The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal
in any of the Rights or other securities of the Company or
become pecuniarily interested in any transaction in which the
Company may be interested, or contract with or lend money to
the Company or otherwise act as fully and freely as though it
were not Rights Agent under this Agreement. Nothing herein
shall preclude the Rights Agent from acting in any other
capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or
agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any
such attorneys or agents or for any loss to the Company
resulting from any such act, default, neglect or misconduct;
provided, however, 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
and/or 2 thereof, the Rights Agent shall not take any further
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action with respect to such requested exercise of transfer
without first consulting with the Company.
(l) The Company agrees to give the Rights Agent prompt
written notice of any event or ownership which would prohibit
the exercise or transfer of the Rights Certificates.
Section 21. Change of Rights Agent. The Rights Agent or
any successor Rights Agent may resign and be discharged from
its duties under this Agreement upon thirty (30) days' notice
in writing mailed to the Company, and to each transfer agent of
the Common Stock and Preferred Stock, by registered or
certified mail, and, if such resignation occurs after the
Distribution Date, to the registered holders of the Rights
Certificates by first-class mail. The Company may remove the
Rights Agent or any successor Rights Agent upon thirty (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, if such removal occurs after
the Distribution Date, to the holders of the Rights
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 thirty (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 Rights Certificate (who
shall, with such notice, submit his Rights Certificate for
inspection by the Company), then any registered holder of any
Rights 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 legal business entity organized
and doing business under the laws of the United States or of
the State of New York or of any other state of the United
States, in good standing, having an office in the State of New
York, which is authorized under such laws to exercise corporate
trust or stock transfer or shareholders services powers and
which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $100,000,000 or (b) an
affiliate of a legal business entity described in clause (a) of
this sentence. After appointment, the successor Rights Agent
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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, if such
appointment occurs after the Distribution Date, mail a notice
thereof in writing to the registered holders of the Rights
Certificates. Failure to give any notice provided for in this
Section 21, however, or any defect therein, shall not affect
the legality or validity of the resignation or removal of the
Rights Agent or the appointment of the successor Rights Agent,
as the case may be.
Section 22. Issuance of New Rights Certificates.
Notwithstanding any of the provisions of this Agreement or of
the Rights to the contrary, the Company may, at its option,
issue new Rights Certificates evidencing Rights in such form as
may be approved by the Board of Directors to reflect any
adjustment or change in the Purchase Price and the number or
kind or class of shares or other securities or property
purchasable under the Rights Certificates made in accordance
with the provisions of this Agreement. In addition, in
connection with the issuance or sale of shares of Common Stock
following the Distribution Date and prior to the redemption or
expiration of the Rights, the Company (a) shall, with respect
to shares of Common Stock so issued or sold pursuant to the
exercise of stock options or under any employee plan or
arrangement, granted or awarded as of the Distribution Date, or
upon the exercise, conversion or exchange of securities
hereinafter issued by the Company, and (b) may, in any other
case, if deemed necessary or appropriate by the Board of
Directors of the Company, issue Rights Certificates
representing the appropriate number of Rights in connection
with such issuance or sale; provided, however, that (i) no such
Rights Certificate shall be issued if, and to the extent that,
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 Rights
Certificate would be issued, and (ii) no such Rights
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Certificate shall be issued if, and to the extent that,
appropriate adjustment shall otherwise have been made in lieu
of the issuance thereof.
Section 23. Redemption and Termination.
(a) The Board of Directors of the Company may, at its
option, at any time prior to the earlier of (i) the close of
business on the tenth day following the Stock Acquisition Date
(or, if the Stock Acquisition Date shall have occurred prior to
the Record Date, the close of business on the tenth day
following the Record Date), or (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"). Notwithstanding anything contained in this
Agreement to the contrary, the Rights shall not be exercisable
after the first occurrence of a Section 11(a)(ii) Event until
such time as the Company's right of redemption hereunder has
expired. The Company may, at its option, pay the Redemption
Price in cash, shares of Common Stock (based on the Current
Market Price, as defined in Section 11(d)(i) hereof, of the
Common Stock at the time of redemption) or any other form of
consideration deemed appropriate by the Board of Directors.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the redemption of the Rights,
evidence of which shall have been filed with the Rights Agent
and without any further action and without any notice, the
right to exercise the Rights will terminate and the only right
thereafter of the holders of Rights shall be to receive the
Redemption Price for each Right so held. Promptly after the
action of the Board of Directors ordering the redemption of the
Rights, the Company shall give notice of such redemption to the
Rights Agent and the holders of the then outstanding Rights by
mailing such notice to all such holders at each holder's last
address as it appears upon the registry books of the Rights
Agent or, prior to the Distribution Date, on the registry books
of the transfer agent for the Common Stock. Any notice which is
mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice. Each such notice
of redemption will state the method by which the payment of the
Redemption Price will be made.
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Section 24. Exchange.
(a) The Board of Directors of the Company may, at its
option, at any time after any Person becomes an Acquiring
Person, exchange all or part of the then outstanding and
exercisable Rights (which shall not include Rights that have
become void pursuant to the provisions of Section 7(e) hereof)
for 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 of Directors of the Company shall not be empowered to
effect such exchange at any time after any Person (other than
the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or any such Subsidiary, or any
entity holding Common Stock for or pursuant to the terms of any
such plan), together with all Affiliates and Associates of such
Person, becomes the Beneficial Owner of 50% or more of the
Common Stock then outstanding.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the exchange of any Rights
pursuant to subsection (a) of this Section 24 and without any
further action and without any notice, the right to exercise
such Rights shall terminate and the only right thereafter of a
holder of such Rights shall be to receive that number of shares
of Common Stock equal to the number of such Rights held by such
holder multiplied by the Exchange Ratio. The Company shall
promptly give public notice of any such exchange; provided,
however, that the failure to give, or any defect in, such
notice shall not affect the validity of such exchange. The
Company promptly shall mail a notice of any such exchange to
all of the holders of such Rights at their last addresses as
they appear upon the registry books of the Rights Agent. Any
notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice.
Each such notice of exchange will state the method by which the
exchange of the Common Stock for Rights will be effected and,
in the event of any partial exchange, the number of Rights
which will be exchanged. Any partial exchange shall be effected
pro rata based on the number of Rights (other than Rights which
have become void pursuant to the provisions of Section 7(e)
hereof) held by each holder of Rights.
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(c) In any exchange pursuant to this Section 24, the
Company, at its option, may substitute Preferred Stock (or
Equivalent Preferred Stock, as such term is defined in
paragraph (b) of Section 11 hereof) for Common Stock
exchangeable for Rights, at the initial rate of one three-
hundredth of a share of Preferred Stock (or Equivalent
Preferred Stock) for each share of Common Stock, as
appropriately adjusted to reflect stock splits, stock dividends
and other similar transactions after the date hereof.
(d) In the event that there shall not be sufficient
shares of Common Stock issued but not outstanding or authorized
but unissued to permit any exchange of Rights as contemplated
in accordance with this Section 24, the Company shall take all
such action as may be necessary to authorize additional shares
of Common Stock for issuance upon exchange of the Rights.
(e) The Company shall not be required to issue fractions
of shares of Common Stock or to distribute certificates which
evidence fractional shares of Common Stock. In lieu of such
fractional shares of Common Stock, there shall be paid to the
registered holders of the Rights Certificates with regard to
which such fractional shares of Common Stock would otherwise be
issuable, an amount in cash equal to the same fraction of the
current market value of a whole share of Common Stock. For the
purposes of this subsection (e), the current market value of a
whole share of Common Stock shall be the closing price of a
share of Common Stock (as determined pursuant to the second
sentence of Section 11(d)(i) hereof) for the Trading Day
immediately prior to the date of exchange pursuant to this
Section 24.
Section 25. Notice of Certain Events.
(a) In case the Company shall 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 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
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Preferred Stock (other than a reclassification involving only
the subdivision of outstanding shares of Preferred Stock), or
(iv) to effect any consolidation or merger into or with any
other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) hereof), or to
effect any sale or other transfer (or to permit one or more of
its Subsidiaries to effect any sale or other transfer), in one
transaction or a series of related transactions, of 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
(other than the Company and/or any of its Subsidiaries in one
or more transactions each of which complies with Section 11(o)
hereof), 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 Rights Certificate, to the
extent feasible and in accordance with Section 26 hereof, a
notice of such proposed action, which shall specify the record
date for the purposes of such stock dividend, distribution of
rights or warrants, or the date on which such reclassification,
consolidation, merger, sale, transfer, liquidation,
dissolution, or winding up is to take place and the date of
participation therein by the holders of the shares 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 (i) or
(ii) above at least twenty (20) days prior to the record date
for determining holders of the shares of Preferred Stock for
purposes of such action, and in the case of any such other
action, at least twenty (20) days prior to the date of the
taking of such proposed action or the date of participation
therein by the holders of the shares of Preferred Stock
whichever shall be the earlier.
(b) In case any of the events set forth in Section
11(a)(ii) hereof shall occur, then, in any such case, (i) the
Company shall as soon as practicable thereafter give to each
holder of a Rights Certificate, to the extent feasible and in
accordance with Section 26 hereof, 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) hereof, and (ii) all references in the preceding
paragraph to Preferred Stock shall be deemed thereafter to
refer to Common Stock and/or, if appropriate, other securities.
Section 26. Notices. Notices or demands authorized by
this Agreement to be given or made by the Rights Agent or by
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the holder of any Rights Certificate to or on the Company shall
be sufficiently given or made if sent by first-class mail,
postage prepaid, addressed (until another address is filed in
writing with the Rights Agent by the Company) as follows:
Deere & Company
Attention: Corporate Secretary
John Deere Road
Moline, Illinois 61265
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 Rights Certificate to or on the
Rights Agent shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed (until another
address is filed in writing by the Rights Agent with the
Company) as follows:
The Bank of New York
Attention: Vice President Administration
101 Barclay Street - 12W
New York, New York 10286
Notices or demands authorized by this Agreement to be given
or made by the Company or the Rights Agent to the holder of any
Rights Certificate (or, if prior to the Distribution Date, to
the holder of certificates representing shares of Common Stock)
shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed to such holder at the address
of such holder as shown on the registry books of the Company.
Section 27. Supplements and Amendments. Prior to the
Distribution Date, and subject to the penultimate sentence of
this Section 27, the Company and the Rights Agent shall, if the
Company so directs, supplement or amend any provision of this
Agreement without the approval of any holders of certificates
representing shares of Common Stock. From and after the
Distribution Date, the Company and the Rights Agent shall, if
the Company so directs, supplement or amend this Agreement
without the approval of any holders of Rights Certificates in
order (i) to cure any ambiguity, (ii) to correct or supplement
any provision contained herein which may be defective or
inconsistent with any other provisions herein, (iii) to shorten
or lengthen any time period hereunder, or (iv) to change or
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supplement the provisions hereunder in any manner which the
Company may deem necessary or desirable and which shall not
adversely affect the interests of the holders of Rights
Certificates (other than an Acquiring Person or an Affiliate or
Associate of an Acquiring Person); provided, this Agreement may
not be supplemented or amended to lengthen any time period
hereunder, pursuant to clause (iii) of this sentence, (A) a
time period relating to when the Rights may be redeemed at such
time as the Rights are not then redeemable, or (B) any other
time period unless such lengthening is for the purpose of
protecting, enhancing or clarifying the rights of, and/or the
benefits to, the holders of Rights. Upon the delivery of a
certificate from an appropriate officer of the Company which
states that the proposed supplement or amendment is in
compliance with the terms of this Section 27, the Rights Agent
shall execute such supplement or amendment. Prior to the
Distribution Date, the interests of the holders of Rights shall
be deemed coincident with the interests of the holders of
Common Stock. Notwithstanding anything herein to the contrary,
this Agreement may not be amended at a time when the Rights are
not redeemable.
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 of
Directors, 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) of the General Rules and Regulations under the
Exchange Act. The Board of Directors of the Company shall have
the exclusive power and authority to administer this Agreement
and to exercise all rights and powers specifically granted to
the Board or to the Company, or as may be necessary or
advisable in the administration of this Agreement, including,
without limitation, the right and power to (i) interpret the
provisions of this Agreement, and (ii) make all determinations
deemed necessary or advisable for the administration of this
Agreement (including a determination to redeem or not redeem
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the Rights or to amend the Agreement). All such actions,
calculations, interpretations and determinations (including,
for purposes of clause (y) below, all omissions with respect to
the foregoing) which are done or made by the Board in good
faith, shall (x) be final, conclusive and binding on the
Company, the Rights Agent, the holders of the Rights and all
other parties, and (y) not subject the Board, or any directors
on the Board to any liability to the holders of the Rights.
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
Rights Certificates (and, prior to the Distribution Date,
registered holders of the Common Stock) any legal or equitable
right, remedy or claim under this Agreement; but this Agreement
shall be for the sole and exclusive benefit of the Company, the
Rights Agent and the registered holders of the Rights
Certificates (and, prior to the Distribution Date, registered
holders of the 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; provided, however, that notwithstanding
anything in this Agreement to the contrary, if any such term,
provision, covenant or restriction is held by such court or
authority to be invalid, void or unenforceable and the Board of
Directors of the Company determines in its good faith judgment
that severing the invalid language from this Agreement would
adversely affect the purpose or effect of this Agreement, the
right of redemption set forth in Section 23 hereof shall be
reinstated and shall not expire until the close of business on
the tenth day following the date of such determination by the
Board of Directors.
Section 32. Governing Law. This Agreement, each Right and
each Rights Certificate issued hereunder shall be deemed to be
a contract made under the laws of the State of Delaware and for
all purposes shall be governed by and construed in accordance
with the laws of such State applicable to contracts made and to
be performed entirely within such State, except that the rights
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and obligations of the Rights Agent shall be governed by the
laws of the State of New York.
Section 33. Counterparts. This Agreement may be executed
in any number of counterparts and each of such counterparts
shall for all purposes be deemed to be an original, and all
such counterparts shall together constitute but one and the
same instrument.
Section 34. Descriptive Headings. Descriptive headings of
the several sections of this Agreement are inserted for
convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and their respective corporate
seals to be hereunto affixed and attested, all as of the day
and year first above written.
Attest: DEERE & COMPANY
By: ________________________ By: ________________________
Name: Name:
Title: Title:
Attest: THE BANK OF NEW YORK
By: ________________________ By: ________________________
Name: Name:
Title: Title:
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Exhibit A
[Form of Rights Certificate]
Certificate No. R- ______________Rights
NOT EXERCISABLE AFTER DECEMBER 31, 2007 UNLESS EXTENDED
PRIOR THERETO BY THE BOARD OF DIRECTORS OR EARLIER IF REDEEMED
BY THE COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE
OPTION OF THE COMPANY, AT $.01 PER RIGHT ON THE TERMS SET FORTH
IN THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, RIGHTS
BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS SUCH TERM IS
DEFINED IN THE RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF
SUCH RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS REPRESENTED
BY THIS RIGHTS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A
PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR
ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN
THE RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHTS CERTIFICATE
AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN
THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF SUCH AGREEMENT.]
Rights Certificate
DEERE & COMPANY
This certifies that ____________________, or registered
assigns, is the registered owner of the number of Rights set
forth above, each of which entitles the owner thereof, subject
to the terms, provisions and conditions of the Rights
Agreement, dated as of December 3, 1997 (the "Rights
Agreement"), between Deere & Company, a Delaware corporation
(the "Company"), and The Bank of New York, a New York
corporation (the "Rights Agent"), to purchase from the Company
at any time prior to 5:00 P.M. (New York City time) on December
31, 2007 (unless such date is extended prior thereto by the
Board of Directors) at the office or offices of the Rights
Agent designated for such purpose, or its successors as Rights
Agent, one three-hundredth of a fully paid, non-assessable
share of Series A Participating Preferred Stock (the "Preferred
Stock") of the Company, at a purchase price of $225 per one
three-hundredth of a share (the "Purchase Price"), upon
- --------------------
1 The portion of the legend in brackets shall be inserted only
if applicable and shall replace the preceding sentence.
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presentation and surrender of this Rights Certificate with the
Form of Election to Purchase and related Certificate duly
executed. The number of Rights evidenced by this Rights
Certificate (and the number of shares which may be purchased
upon exercise thereof) set forth above, and the Purchase Price
per share set forth above, are the number and Purchase Price as
of December 3, 1997 based on the Preferred Stock as constituted
at such date. The Company reserves the right to require prior
to the occurrence of a Triggering Event (as such term is
defined in the Rights Agreement) that a number of Rights be
exercised so that only whole shares of Preferred Stock will be
issued.
Upon the occurrence of a Section 11(a)(ii) Event (as such
term is defined in the Rights Agreement), if the Rights
evidenced by this Rights Certificate are beneficially owned by
(a) an Acquiring Person or an Affiliate or Associate of any
such Acquiring Person (as such terms are defined in the Rights
Agreement), (b) a transferee of any such Acquiring Person,
Associate or Affiliate, or (c) under certain circumstances
specified in the Rights Agreement, a transferee of a person
who, after such transfer, became an Acquiring Person, or an
Affiliate or Associate of an Acquiring Person, such Rights
shall become null and void and no holder hereof shall have any
right with respect to such Rights from and after the occurrence
of such Section 11(a)(ii) Event.
As provided in the Rights Agreement, the Purchase Price and
the number and kind of shares of Preferred Stock or other
securities, which may be purchased upon the exercise of the
Rights evidenced by this Rights Certificate are subject to
modification and adjustment upon the happening of certain
events, including Triggering Events.
This Rights 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 Rights Certificates, which limitations of rights include
the temporary suspension of the exercisability of such Rights
under the specific circumstances set forth in the Rights
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Agreement. Copies of the Rights Agreement are on file at the
above-mentioned office of the Rights Agent and are also
available upon written request to the Rights Agent.
This Rights Certificate, with or without other Rights
Certificates, upon surrender at the principal office or offices
of the Rights Agent designated for such purpose, may be
exchanged for another Rights Certificate or Rights Certificates
of like tenor and date evidencing Rights entitling the holder
to purchase a like aggregate number of one three-hundredths of
a share of Preferred Stock as the Rights evidenced by the
Rights Certificate or Rights Certificates surrendered shall
have entitled such holder to purchase. If this Rights
Certificate shall be exercised in part, the holder shall be
entitled to receive upon surrender hereof another Rights
Certificate or Rights Certificates for the number of whole
Rights not exercised.
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate may be redeemed by the
Company at its option at a redemption price of $.01 per Right
at any time prior to the earlier of the close of business on
(i) the tenth day following the Stock Acquisition Date (as such
time period may be extended pursuant to the Rights Agreement),
and (ii) the Final Expiration Date. In addition, under certain
circumstances following the Stock Acquisition Date, the Rights
may be exchanged, in whole or in part, for shares of the Common
Stock, or shares of preferred stock of the Company having
essentially the same value or economic rights as such shares.
Immediately upon the action of the Board of Directors of the
Company authorizing any such exchange, and without any further
action or any notice, the Rights (other than Rights which are
not subject to such exchange) will terminate and the Rights
will only enable holders to receive the shares issuable upon
such exchange.
No fractional shares of Preferred Stock will be issued upon
the exercise of any Right or Rights evidenced hereby (other
than fractions which are integral multiples of one three-
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. The Company, at its election, may require
that a number of Rights be exercised so that only whole shares
of Preferred Stock would be issued.
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No holder of this Rights Certificate shall be entitled to
vote or receive dividends or be deemed for any purpose the
holder of shares of Preferred Stock or of any other securities
of the Company which may at any time be issuable on the
exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder
hereof, as such, any of the rights of a stockholder of the
Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting
thereof, or to give consent to or withhold consent from any
corporate action, or, to receive notice of meetings or other
actions affecting stockholders (except as provided in the
Rights Agreement), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced by
this Rights Certificate shall have been exercised as provided
in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory
for any purpose until it shall have been countersigned by the
Rights Agent.
WITNESS the facsimile signature of the proper officers of
the Company and its corporate seal.
Dated as of __________ __, ____
ATTEST: DEERE & COMPANY
__________________________ By: ________________________
Secretary Title:
Countersigned:
THE BANK OF NEW YORK
By: ____________________________
Authorized Signature
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[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires
to transfer the Rights Certificate.)
FOR VALUE RECEIVED _________________________________ hereby
sells, assigns and transfers unto ____________________________
______________________________________________________________
(Please print name and address of transferee)
this Rights Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and
appoint ________________ Attorney, to transfer the within
Rights Certificate on the books of the within-named Company,
with full power of substitution.
Dated: ______________, ____
__________________________________
Signature
Signature Guaranteed:
Certificate
The undersigned hereby certifies by checking the
appropriate boxes that:
(1) this Rights Certificate [ ] is [ ] is not being
sold, assigned and transferred 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 pursuant
to the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it [ ] did [ ] did not acquire the Rights
evidenced by this Rights Certificate from any Person who is,
was or subsequently became an Acquiring Person or an Affiliate
of Associate of an Acquiring Person.
Dated: ______________, ____
__________________________________
Signature
Signature Guaranteed:
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NOTICE
The signature to the foregoing Assignment and Certificate
must correspond to the name as written upon the face of this
Rights Certificate in every particular, without alteration or
enlargement or any change whatsoever.
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise Rights
represented by the Rights Certificate.)
To: DEERE & COMPANY:
The undersigned hereby irrevocably elects to exercise
__________ Rights represented by this Rights Certificate to
purchase the 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 shares
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 Rights Certificate, a new Rights Certificate
for the balance of such Rights shall be registered in the name
of and delivered to:
Please insert social security
of other identifying number
______________________________________________________________
(Please print name and address)
______________________________________________________________
Dated: ______________, ____ ___________________________
Signature
Signature Guaranteed:
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<PAGE>
CERTIFICATE
The undersigned hereby certifies by checking the
appropriate boxes that:
(1) the Rights evidenced by this Rights 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
pursuant to the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it [ ] did [ ] did not acquire the Rights
evidenced by this Rights Certificate from any Person who is,
was or became an Acquiring Person or an Affiliate or Associate
of an Acquiring Person.
Dated: ______________, ____ ___________________________
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Election to Purchase and
Certificate must correspond to the name as written upon the
face of this Rights Certificate in every particular, without
alteration or enlargement or any change whatsoever.
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Exhibit B
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED STOCK
On December 3, 1997, the Board of Directors of Deere &
Company (the "Company") declared a dividend distribution of one
Right for each outstanding share of Company Common Stock to
stockholders of record at the close of business on December 31,
1997 (the "Record Date"). Each Right entitles the registered
holder to purchase from the Company a unit consisting of one
three-hundredth of a share (a "Unit") of Series A Participating
Preferred Stock, $1 par value (the "Preferred Stock") at a
Purchase Price of $225 per Unit, subject to adjustment. The
description and terms of the Rights are set forth in a Rights
Agreement (the "Rights Agreement") between the Company and The
Bank of New York, as Rights Agent.
Initially, the Rights will be attached to all Common Stock
certificates representing shares then outstanding, and no
separate Rights Certificates will be distributed. Subject to
certain exceptions specified in the Rights Agreement, the
Rights will separate from the Common Stock and a Distribution
Date will occur upon the earlier of (i) 10 days following a
public announcement that a person or group of affiliated or
associated persons (an "Acquiring Person") has acquired
beneficial ownership of 15% or more of the outstanding shares
of Common Stock (the "Stock Acquisition Date"), other than as a
result of repurchases of stock by the Company or certain
inadvertent actions by institutional or certain other
stockholders, or (ii) 10 business days (or such later date as
the Board shall determine) following the commencement of a
tender offer or exchange offer that would result in a person or
group becoming an Acquiring Person. Until the Distribution
Date, (i) the Rights will be evidenced by the Common Stock
certificates and will be transferred with and only with such
Common Stock certificates, (ii) new Common Stock certificates
issued after the Record Date will contain a notation
incorporating the Rights Agreement by reference and (iii) the
surrender for transfer of any certificates for Common Stock
outstanding will also constitute the transfer of the Rights
associated with the Common Stock represented by such
certificate. Pursuant to the Rights Agreement, the Company
reserves the right to require prior to the occurrence of a
Triggering Event (as defined below) that, upon any exercise of
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<PAGE>
Rights, a number of Rights be exercised so that only whole
shares of Preferred Stock will be issued.
The Rights are not exercisable until the Distribution Date
and will expire at 5:00 P.M. (New York City time) on December
31, 2007, unless such date is extended or the Rights are
earlier redeemed or exchanged by the Company as described
below.
As soon as practicable after the Distribution Date, Rights
Certificates will be mailed to holders of record of the Common
Stock as of the close of business on the Distribution Date and,
thereafter, the separate Rights Certificates alone will
represent the Rights. Except as otherwise determined by the
Board of Directors, only shares of Common Stock issued prior to
the Distribution Date will be issued with Rights.
In the event that a Person becomes an Acquiring Person,
except pursuant to an offer for all outstanding shares of
Common Stock which the independent directors determine to be
fair and not inadequate to and to otherwise be in the best
interests of the Company and its stockholders, after receiving
advice from one or more investment banking firms, each holder
of a Right will thereafter have the right to receive, upon
exercise, Common Stock (or, in certain circumstances, cash,
property or other securities of the Company) having a value
equal to two times the exercise price of the Right.
Notwithstanding any of the foregoing, following the occurrence
of any of the events set forth in this paragraph, all Rights
that are, or (under certain circumstances specified in the
Rights Agreement) were, beneficially owned by any Acquiring
Person will be null and void. However, Rights are not
exercisable following the occurrence of the events set forth
above until such time as the Rights are no longer redeemable by
the Company as set forth below.
For example, at an exercise price of $225 per Right, each
Right not owned by an Acquiring Person (or by certain related
parties) following an event set forth in the preceding
paragraph would entitle its holder to purchase $450 worth of
Common Stock (or other consideration, as noted above) for $225.
Assuming that the Common Stock had a per share value of $50 at
such time, the holder of each valid Right would be entitled to
purchase 9 shares of Common Stock for $225.
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In the event that, at any time following the Stock
Acquisition Date, (i) the Company is acquired in a merger or
other business combination transaction in which the Company is
not the surviving corporation (other than with an entity which
acquired the shares pursuant to an offer described in the
second preceding paragraph), (ii) the Company engages in a
merger or other business combination transaction in which the
Company is the surviving corporation and the Common Stock of
the Company is changed or exchanged, or (iii) 50% or more of
the Company's assets or earning power is sold or transferred,
each holder of a Right (except Rights which have previously
been voided as set forth above) shall thereafter have the right
to receive, upon exercise, Common Stock of the acquiring
company having a value equal to two times the exercise price of
the Right. The events set forth in this paragraph and in the
second preceding paragraph are referred to as the "Triggering
Events."
At any time after a person becomes an Acquiring Person and
prior to the acquisition by such person or group of fifty
percent (50%) or more of the outstanding Common Stock, the
Board may exchange the Rights (other than Rights owned by such
person or group which have become void), in whole or in part,
at an exchange ratio of one share of Common Stock, or one three-
hundredth of a share of Preferred Stock (or of a share of a
class or series of the Company's preferred stock having
equivalent rights, preferences and privileges), per Right
(subject to adjustment).
At any time until ten days following the Stock Acquisition
Date, the Company may redeem the Rights in whole, but not in
part, at a price of $.01 per Right (payable in cash, Common
Stock or other consideration deemed appropriate by the Board of
Directors). Immediately upon the action of the Board of
Directors ordering redemption of the Rights, the Rights will
terminate and the only right of the holders of Rights will be
to receive the $.01 redemption price.
Until a Right is exercised, the holder thereof, as such,
will have no rights as a stockholder of the Company, including,
without limitation, the right to vote or to receive dividends.
While the distribution of the Rights will not be taxable to
stockholders or to the Company, stockholders may, depending
upon the circumstances, recognize taxable income in the event
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<PAGE>
that the Rights become exercisable for Common Stock (or other
consideration) of the Company or for Common Stock of the
acquiring company or in the event of the redemption of the
Rights as set forth above.
Any of the provisions of the Rights Agreement may be
amended by the Board of Directors of the Company prior to the
Distribution Date. After the Distribution Date, the provisions
of the Rights Agreement may be amended by the Board in order to
cure any ambiguity, to make changes which do not adversely
affect the interests of holders of Rights, or to shorten or
lengthen any time period under the Rights Agreement. The
foregoing notwithstanding, no amendment may be made at such
time as the Rights are not redeemable.
A copy of the Rights Agreement is being 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 Rights Agent.
This summary description of the Rights does not purport to be
complete and is qualified in its entirety by reference to the
Rights Agreement, which is incorporated herein by reference.
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EXHIBIT 99
FOR IMMEDIATE RELEASE CONTACT: Gordon Tjelmeland
3 DECEMBER 1997 Deere & Company
John Deere Road
Moline, IL 61265
309-765-5678
DEERE & COMPANY
DECLARES QUARTERLY DIVIDEND
Moline, Illinois -- The Deere & Company board of directors
today declared a quarterly dividend of 22 cents per share,
payable February 2, 1998 to shareholders of record on
December 31, 1997. This represents an increase of 10%.
The board today also authorized the repurchase of up to $1
billion of Deere & Company Common Stock. The Company currently
has approximately 250 million shares outstanding.
Deere & Company Chairman and Chief Executive Officer, Hans
W. Becherer said "Today's action by the board to extend our
stock repurchase program recognizes Deere's financial strength
and the Company's record operating performance for the last
fiscal year. It also reflects the board's continued confidence
in the Company's prospects. We believe this action provides
excellent value to our shareholders."
At the Company's discretion, repurchases of Deere & Company
Common Stock will be made from time to time in the open market
and through privately negotiated transactions.
On November 25, 1997, the Company reported record earnings
for its recently completed fiscal year with worldwide net
income of $960.1 million or $3.78 per share for the fiscal year
ended October 31, 1997.
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