SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-A/A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(B) OR (G) OF THE
SECURITIES EXCHANGE ACT OF 1934
MELLON BANK CORPORATION
- --------------------------------------------------------------------------------
(Exact Name of Registrant as specified in its Charter)
PENNSYLVANIA 25-1233834
- --------------------------------------------------------------------------------
(State of Incorporation or Organization) (IRS Employer Identification No.)
ONE MELLON BANK CENTER
PITTSBURGH, PENNSYLVANIA 15258-0001
- --------------------------------------------------------------------------------
(Address of Principal Executive Office) (Zip Code)
If this form relates to the If this form relates to the
registration of a class of the registration of a class of
securities pursuant to Section 12(b) securities pursuant to Section 12(g)
of the Exchange Act and is effective of the Exchange Act and is effective
to General Instruction A.(c), please pursuant to General Instruction A.(d),
check the following box. [X] please check the following box. [_]
Securities Act registration statement file number to which this form
relates: NONE
-------
(If applicable)
Securities to be Registered Pursuant to Section 12(b) of the Act:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH
TO BE SO REGISTERED: EACH CLASS IS TO BE REGISTERED:
------------------- -------------------------------
Stock Purchase Rights New York Stock Exchange, Inc.
Securities to be Registered Pursuant to Section 12(g) of the Act:
NONE
- --------------------------------------------------------------------------------
(Title of Class)
<PAGE>
This Form 8-A/A is filed to amend and restate the information set forth
in the Registration Statement on Form 8-A filed by Mellon Bank Corporation, a
Pennsylvania corporation, on October 31, 1996.
ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED.
On October 15, 1996, the Board of Directors of Mellon Bank Corporation,
a Pennsylvania corporation (the "Company"), declared a dividend payable October
31, 1996 of one right (a "Right") for each outstanding share of common stock,
par value $.50 per share ("Common Stock"), of the Company held of record at the
close of business on October 31, 1996 (the "Record Time"), or issued thereafter
and prior to the Separation Time (as defined in the following paragraph) and
thereafter pursuant to options and convertible securities outstanding at the
Separation Time. The Rights are issued pursuant to a Shareholder Protection
Rights Agreement, dated as of October 15, 1996 and amended and restated as of
May 17, 1999 (the "Rights Agreement"), between the Company and Mellon Bank,
N.A., as Rights Agent (the "Rights Agent"). Each Right entitles its registered
holder to purchase from the Company, after the Separation Time, one
one-hundredth of a share of Participating Preferred Stock, par value $1.00 per
share ("Participating Preferred Stock"), for $56.25 (the "Exercise Price"),
subject to adjustment.
Until the Separation Time, one Right will be associated with one share
of Common Stock and the rights will be evidenced only as described below. The
"Separation Time" means the close of business on the earlier of:
(i) The tenth Business Day (or such later date as the Board of
Directors of the Company may from time to time fix by resolution
adopted prior to the Separation Time that would otherwise have
occurred) after the date on which any Person commences a tender or
exchange offer which, if consummated, would result in such Person's
becoming an Acquiring Person (as defined in the following paragraph);
and
(ii) The first date (the "Flip-in Date") of public announcement by
the Company that a Person (as defined in the Rights Agreement) has
become an Acquiring Person, other than as the result of a Flip-over
Transaction or Event (as defined below);
provided that, if any tender or exchange offer referred to in clause (i) of this
definition is cancelled, terminated or otherwise withdrawn prior to the
Separation Time without the purchase of any shares of Common Stock pursuant
thereto, such offer shall be deemed, for purposes of this definition, never to
have been made.
An "Acquiring Person" is any Person who is a Beneficial Owner (as
defined in the Rights Agreement) of 15% or more of the outstanding shares of
Common Stock, but such term does not include:
-2-
<PAGE>
(i) Any Person who is the Beneficial Owner of 15% or more of the
outstanding shares of Common Stock on October 15, 1996 or who shall
become the Beneficial Owner of 15% or more of the outstanding shares of
Common Stock solely as a result of an acquisition by the Company of
shares of Common Stock, until such time hereafter or thereafter as such
Person shall become the Beneficial Owner (other than by means of a
stock dividend or stock split or by purchase from the Company) of any
additional shares of Common Stock;
(ii) Any Person who becomes the Beneficial Owner of 15% or more of
the outstanding shares of Common Stock but who acquired Beneficial
Ownership of shares of Common Stock without any plan or intention to
seek or affect control of the Company, if such Person promptly enters
into an irrevocable commitment to divest, and thereafter promptly
divests (without exercising or retaining any power, including voting,
with respect to such shares), sufficient shares of Common Stock (or
securities convertible into, exchangeable into or exercisable for
Common Stock) so that such Person ceases to be the Beneficial Owner of
15% or more of the outstanding shares of Common Stock;
(iii) Any Person who Beneficially Owns shares of Common Stock
consisting solely of one or more of (A) shares of Common Stock
Beneficially Owned pursuant to the grant or exercise of an option
granted to such Person (an "Option Holder") by the Company in
connection with an agreement to merge with, or acquire, the Company
entered into prior to a Flip-in Date, (B) shares of Common Stock (or
securities convertible into, exchangeable into or exercisable for
Common Stock), Beneficially Owned by such Option Holder or its
Affiliates or Associates at the time of grant of such option, (C)
shares of Common Stock (or securities convertible into, exchangeable
into or exercisable for Common Stock) acquired by Affiliates or
Associates of such Option Holder after the time of such grant which, in
the aggregate, amount to less than 1% of the outstanding shares of
Common Stock, and (D) shares of Common Stock (or securities convertible
into, exchangeable into or exercisable for Common Stock) which are held
by such Option Holder in trust accounts, managed accounts and the like
or otherwise held in a fiduciary capacity, that are beneficially owned
by third Persons who are not Affiliates or Associates of such Option
Holder or acting together with such Option Holder to hold such shares,
or which are held by such Person in respect of a debt previously
contracted; and
(iv) The Company, any wholly-owned Subsidiary of the Company or an
employee stock ownership plan or other employee benefit plan of the
Company or a wholly-owned subsidiary of the Company or any stock
benefit trust established by the Company.
The Rights Agreement provides that, until the Separation Time, the
Rights will be transferred with and only with the Common Stock. To the extent
issued after the Record Time but prior to the Separation Time, (i) Common Stock
certificates and (ii) any confirmation or
-3-
<PAGE>
advice by the Company of issuance or transfer of uncertificated shares of Common
Stock shall contain a legend and a notice, respectively, incorporating by
reference the terms of the Rights Agreement (as such may be amended from time to
time). Notwithstanding the absence of the legend or notice, (i) certificates
representing certificated shares of Common Stock issued and outstanding at the
Record Time shall evidence one Right for each share of Common Stock evidenced
thereby and (ii) uncertificated shares of Common Stock issued and outstanding at
the Record Time shall entitle the holder to one Right for each share of Common
Stock.
Until the Separation Time, the Rights will be evidenced only as
described in the preceding paragraph. Promptly following the Separation Time,
separate certificates evidencing the Rights ("Rights Certificates") will be
mailed to holders of record of Common Stock at the Separation Time.
The Rights will not be exercisable until after the Separation Time. The
Rights will expire on the earliest of (any such time, the "Expiration Time"):
(i) The Exchange Time,
(ii) The Redemption Time,
(iii) The close of business on the tenth anniversary of the Record
Time, and
(iv) Immediately prior to the effective time of a consolidation,
merger or share exchange of the Company (A) into another corporation or
(B) with another corporation in which the Company is the surviving
corporation but Common Stock is converted into cash and/or securities
of another corporation, in either case pursuant to an agreement entered
into by the Company prior to a Stock Acquisition Date.
After the Expiration Time, no Person shall have any rights pursuant to the
Rights Agreement or any Right.
The Exercise Price and the number of Rights outstanding, or in certain
circumstances the securities purchasable upon exercise of the Rights, are
subject to adjustment from time to time to prevent dilution in the event of a
Common Stock dividend on, or a subdivision or a combination into a smaller
number of shares of, Common Stock, or the issuance or distribution of any
securities or assets in respect of, in lieu of or in exchange for Common Stock.
In the event that prior to the Expiration Time a Flip-in Date shall
occur, the Company shall take such action as shall be necessary to ensure and
provide that each Right (other than Rights Beneficially Owned by the Acquiring
Person or any affiliate or associate thereof, which Rights shall become void)
shall constitute the right to purchase from the Company, upon the exercise
thereof in accordance with the terms of the Rights Agreement, that number of
shares
-4-
<PAGE>
of Common Stock or Participating Preferred Stock of the Company having an
aggregate Market Price (as defined in the Rights Agreement), on the date of the
public announcement of an Acquiring Person's becoming such (the "Stock
Acquisition Date") that gave rise to the Flip-in Date, equal to twice the
Exercise Price for an amount in cash equal to the then current Exercise Price.
In addition, the Board of Directors of the Company may, at its option, at any
time after a Flip-in Date, to the fullest extent that applicable law would not
prohibit Rights owned by Acquiring Persons or Affiliates or Associates thereof
becoming void pursuant to the provisions thereof, elect to exchange all (but not
less than all) the then outstanding Rights for shares of Common Stock at an
exchange ratio of one share of Common Stock per Right, appropriately adjusted in
order to protect the interests of holders of Rights generally in the event that
after the Separation Time an event such as a stock dividend, stock split,
reclassification or recapitalization shall have occurred with respect to the
Common Stock (such exchange ratio, as adjusted from time to time, being
hereinafter referred to as the "Exchange Ratio"). Immediately upon the action of
the Board of Directors of the Company electing to exchange the Rights, without
any further action and without any notice, the right to exercise the Rights will
terminate (the "Termination Time") and each Right will thereafter represent only
the right to receive a number of shares of Common Stock equal to the Exchange
Ratio. Whenever the Company shall become obligated under the provisions
described in this paragraph to issue shares of Common Stock upon exercise of or
in exchange for Rights, the Company, at its option, may substitute therefor
shares of Participating Preferred Stock, at a ratio of one one-hundredth of a
share of Participating Preferred Stock for each share of Common Stock so
issuable.
The Rights Agreement provides that prior to the Expiration Time, the
Company shall not enter into any agreement with an Acquiring Person with respect
to, consummate or permit to occur any Flip-over Transaction or Event (as defined
below) unless and until it shall have entered into a supplemental agreement with
the Flip-over Entity (i.e., the Person issuing any securities into which shares
of Common Stock are being converted or exchanged and, if no such securities are
being issued, the other party to such Flip-over Transaction or Event, or the
Person receiving the greatest portion of the assets or operating income or cash
flow being transferred in a Flip-over Transaction or Event), for the benefit of
the holders of the Rights, providing that, upon consummation or occurrence of
the Flip-over Transaction or Event:
(i) Each Right shall thereafter constitute the right to purchase
from the Flip-over Entity, upon exercise thereof in accordance with the
Rights Agreement, that number of shares of Flip-over Stock (i.e., the
capital stock with the greatest voting power in respect of the election
of directors of the Flip-over Entity) of the Flip-over Entity having an
aggregate Market Price on the date of consummation or occurrence of
such Flip-over Transaction or Event equal to twice the Exercise Price
for an amount in cash equal to the Exercise Price; and
(ii) The Flip-over Entity shall thereafter be liable for, and
shall assume, by virtue of such Flip-over Transaction or Event and such
supplemental agreement, all the obligations and duties of the Company
pursuant to the Rights Agreement. For purposes
-5-
<PAGE>
of the foregoing description, the term "Acquiring Person" shall include
any Acquiring Person and its Affiliates and Associates (as such terms
are defined in the Rights Agreement) counted together as a single
Person.
A "Flip-over Transaction or Event" is a transaction or series of
transactions on or after a Flip-in Date in which, directly or indirectly:
(i) The Company shall consolidate or merge with, or participate in
a share exchange with any other Person if, at the time of the
consolidation, merger or share exchange or at the time the Company
enters into any agreement with respect to any such consolidation,
merger or share exchange, the Acquiring Person controls the Board of
Directors of the Company and either (A) any terms of or arrangement
concerning the treatment of shares of capital stock in such
consolidation, merger or share exchange relating to the Acquiring
Person is not identical to the terms and arrangements relating to other
holders of the Common Stock or (B) the Person with whom the transaction
or series of transactions occurs is the Acquiring Person or an
Affiliate or Associate of the Acquiring Person, or
(ii) The Company shall sell or otherwise transfer (or one or more
of its subsidiaries shall sell or otherwise transfer) assets of the
Company and its Subsidiaries (taken as a whole) to any Person (other
than the Company or one or more of its wholly-owned subsidiaries) or to
two or more such Persons which are Affiliates or Associates or
otherwise acting in concert, if, at the time of the entry by the
Company (or any such Subsidiary) into an agreement with respect to such
sale or transfer of assets, the Acquiring Person controls the Board of
Directors of the Company.
For purposes of the foregoing description, (i) the term "Acquiring Person"
includes any Acquiring Person and its Affiliates and Associates (other than the
Company), and (ii) an Acquiring Person shall be deemed to control the Company's
Board of Directors when, following a Flip-in Date, the persons who were
directors of the Company (or persons nominated and/or appointed as directors by
vote of a majority of such persons) before the Stock Acquisition Date shall
cease to constitute a majority of the Company's Board of Directors.
The Rights Agreement provides that prior to the Expiration Time, unless
the Rights have been redeemed, the Company shall not enter into any agreement
with respect to, consummate or permit to occur any Flip-over Transaction or
Event if at the time thereof there are any rights, warrants or securities
outstanding or any other arrangements, agreements or instruments which would
eliminate or otherwise diminish in any material respect the benefits intended to
be afforded by the Rights Agreement to the holders of Rights upon consummation
of such transaction.
The Board of Directors of the Company may, at its option, at any time
prior to the close of business on the Flip-In Date, elect to redeem all (but not
less than all) the then out-
-6-
<PAGE>
standing Rights at the Redemption Price and the Company, at its option, may pay
the Redemption Price either in cash or shares of Common Stock or other
securities of the Company deemed by the Board of Directors, in the exercise of
its sole discretion, to be at least equivalent in value to the Redemption Price.
Immediately upon the action of the Board of Directors of the Company electing to
redeem the Rights (or, if the resolution of the Board of Directors electing to
redeem the Rights states that the redemption will not be effective until the
occurrence of a specified future time or event, upon the occurrence of such
future time or event), without any further action and without any notice, the
right to exercise the Rights will terminate and each Right will thereafter
represent only the right to receive the Redemption Price in cash or securities,
as determined by the Board of Directors. Promptly after the Rights are redeemed,
the Company shall give notice of such redemption to the Rights Agent and the
holders of the then outstanding Rights.
The holders of Rights will, solely by reason of their ownership of
Rights, have no rights as shareholders of the Company, including, without
limitation, the right to vote or to receive dividends.
The Rights will not prevent a takeover of the Company. However, the
Rights may cause substantial dilution to a person or group that acquires 15% or
more of the Common Stock unless the Rights are first redeemed by the Board of
Directors of the Company. Nevertheless, the Rights should not interfere with a
transaction that is in the best interests of the Company and its shareholders
because the Rights can be redeemed on or prior to the close of business on the
Flip-in Date, before the consummation of such transaction.
As long as the Rights are attached to the Common Stock, the Company
will issue one Right with each new share of Common Stock so that all such shares
will have Rights attached.
The Rights Agreement (which includes as Exhibit A the forms of Rights
Certificate and Election to Exercise and as Exhibit B the form of resolution of
the Company's Board of Directors establishing and designating the Participating
Preferred Stock) is attached hereto as an exhibit and is incorporated herein by
reference. The foregoing description of the Rights is qualified in its entirety
by reference to the Rights Agreement and such exhibits thereto.
ITEM 2. EXHIBITS.
(1) Shareholder Protection Rights Agreement, dated as of October 15, 1996,
between the Company and Mellon Bank, N.A., as Rights Agent (as amended
and restated as of May 17, 1999 and including exhibits thereto).
-7-
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this registration statement to be
signed on its behalf by the undersigned, thereunto duly authorized.
MELLON BANK CORPORATION
By: /s/ Carl Krasik
------------------------------
Name: Carl Krasik
Title: Secretary
Date: May 17, 1999
-8-
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
- ---------- -----------
(1) Shareholder Protection Rights Agreement, dated as of October 15,
1996, between the Company and Mellon Bank, N.A., as Rights Agent
(as amended and restated as of May 17, 1999 and including
exhibits thereto).
Exhibit (1)
AMENDMENT AND RESTATEMENT AGREEMENT, dated as of May 17, 1999 (this
"Amendment Agreement"), between Mellon Bank Corporation, a Pennsylvania
corporation (the "Company"), and Mellon Bank, N.A., a national banking
association, as Rights Agent under the Rights Agreement referred to below (the
"Rights Agent").
W I T N E S S E T H:
WHEREAS, the Company and the Rights Agent are parties to the
Shareholder Protection Rights Agreement, dated as of October 15, 1996 (as
amended by Amendment No. 1 thereto, dated as of June 2, 1997, the "Rights
Agreement");
WHEREAS, the Company has requested that the Rights Agent duly execute
and deliver this Amendment Agreement;
WHEREAS, Section 5.4 of the Rights Agreement provides that the Company
and the Rights Agent may from time to time amend the Rights Agreement in any
respect prior to the Flip-in Date (as defined in the Rights Agreement) and that
the Rights Agent will, at the request of the Company, execute and deliver any
amendment to the Rights Agreement satisfying the terms of Section 5.4; and
WHEREAS, no Flip-in Date has occurred as of the date hereof;
NOW, THEREFORE, in consideration of the premises, the parties hereby
agree as follows:
1. Amendment and Restatement. The Rights Agreement is hereby amended
and restated to read as set forth in the attached Amended and Restated
Shareholder Protection Rights Agreement.
2. Counterparts. This Amendment 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.
3. GOVERNING LAW. THIS AMENDMENT AGREEMENT SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA AND FOR ALL
PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF SUCH
STATE APPLICABLE TO CONTRACTS TO BE MADE AND PERFORMED ENTIRELY WITHIN SUCH
STATE.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Agreement to be executed as of the date first above written.
MELLON BANK CORPORATION
By /s/ Martin G. McGuinn
------------------------------------
Martin G. McGuinn
Chairman and Chief
Executive Officer
MELLON BANK, N.A.,
as Rights Agent
By /s/ Christopher M. Condron
------------------------------------
Christopher M. Condron
President and Chief
Operating Officer
<PAGE>
- -------------------------------------------------------------------------------
SHAREHOLDER PROTECTION RIGHTS AGREEMENT
dated as of
October 15, 1996
between
MELLON BANK CORPORATION
and
MELLON BANK, N.A.,
as Rights Agent
------------------------
Amended and Restated
as of
May 17, 1999
------------------------
- -------------------------------------------------------------------------------
<PAGE>
SHAREHOLDER PROTECTION RIGHTS AGREEMENT
Table of Contents
Page
----
ARTICLE I
DEFINITIONS............................... 1
1.1 Certain Definitions................................................... 1
ARTICLE II
THE RIGHTS.................................. 9
2.1 Summary of Rights..................................................... 9
2.2 Rights Associated with Common Stock; Legends.......................... 9
2.3 Exercise of Rights; Separation of Rights..............................11
2.4 Adjustments to Exercise Price; Number of
Rights................................................................14
2.5 Date on Which Exercise is Effective...................................15
2.6 Execution, Authentication, Delivery
and Dating of Rights Certificates.....................................15
2.7 Registration, Registration of Transfer and
Exchange..............................................................16
2.8 Mutilated, Destroyed, Lost and Stolen Rights
Certificates..........................................................17
2.9 Persons Deemed Owners.................................................18
2.10 Delivery and Cancellation of Certificates.............................18
2.11 Agreement of Rights Holders...........................................19
ARTICLE III
ADJUSTMENTS TO THE RIGHTS
IN THE EVENT OF CERTAIN TRANSACTIONS...................20
3.1 Flip-in...............................................................20
3.2 Flip-over.............................................................22
ARTICLE IV
THE RIGHTS AGENT.............................23
4.1 General...............................................................23
4.2 Merger or Consolidation or Change of Name of
Rights Agent..........................................................24
4.3 Duties of Rights Agent................................................25
4.4 Change of Rights Agent................................................27
-i-
<PAGE>
Page
----
ARTICLE V
MISCELLANEOUS..............................28
5.1 Redemption............................................................28
5.2 Expiration............................................................29
5.3 Issuance of New Rights Certificates...................................29
5.4 Supplements and Amendments............................................29
5.5 Fractional Shares.....................................................30
5.6 Rights of Action......................................................30
5.7 Holder of Rights Not Deemed a Shareholder.............................30
5.8 Notice of Proposed Actions............................................31
5.9 Notices...............................................................31
5.10 Suspension of Exercisability or Exchangeability.......................32
5.11 Costs of Enforcement..................................................32
5.12 Successors............................................................33
5.13 Benefits of this Agreement............................................33
5.14 Determination and Actions by the Board of Directors, etc..............33
5.15 Descriptive Headings..................................................33
5.16 GOVERNING LAW.........................................................33
5.17 Counterparts..........................................................33
5.18 Severability..........................................................34
EXHIBITS
Exhibit A Form of Rights Certificate
(Together with Form of
Election to Exercise)
Exhibit B Form of Resolution of Board of
Directors of Mellon Bank
Corporation Establishing and
Designating Participating
Preferred Stock
-ii-
<PAGE>
SHAREHOLDER PROTECTION RIGHTS AGREEMENT, dated as of October 15, 1996
and amended and restated as of May 17, 1999 (as further amended from time to
time, this "Agreement"), between Mellon Bank Corporation, a Pennsylvania
corporation (the "Company"), and Mellon Bank, N.A., a national banking
association, as Rights Agent (the "Rights Agent", which term shall include any
successor Rights Agent hereunder).
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company has (a) authorized and
declared a dividend of one right ("Right") in respect of each share of Common
Stock (as hereinafter defined) held of record as of the close of business on
October 31, 1996 (the "Record Time") and (b) as provided in Section 2.4,
authorized the issuance of one Right in respect of each share of Common Stock
issued or sold by the Company after the Record Time and prior to the Separation
Time (as hereinafter defined) and, to the extent provided in Section 5.3(b),
each share of Common Stock issued or sold by the Company after the Separation
Time;
WHEREAS, subject to the terms and conditions hereof, each Right
entitles the holder thereof, after the Separation Time, to purchase securities
or assets of the Company (or, in certain cases, securities of certain other
entities) pursuant to the terms and subject to the conditions set forth herein;
and
WHEREAS, the Company desires to appoint the Rights Agent to act on
behalf of the Company, and the Rights Agent is willing so to act, in connection
with the issuance, transfer, exchange and replacement of Rights Certificates (as
hereinafter defined), the exercise of Rights and other matters referred to
herein;
NOW, THEREFORE, in consideration of the premises and the respective
agreements set forth herein and intending to be legally bound hereby, the
parties hereby agree as follows:
ARTICLE I
DEFINITIONS
-----------
1.1 Certain Definitions. For purposes of this Agreement, the following
terms have the meanings indicated:
<PAGE>
"Acquiring Person" shall mean any Person who is a Beneficial Owner of
15% or more of the outstanding shares of Common Stock; provided, however, that
the term "Acquiring Person" shall not include
(i) any Person who is the Beneficial Owner of 15% or more of the
outstanding shares of Common Stock on October 15, 1996 or who shall
become the Beneficial Owner of 15% or more of the outstanding shares of
Common Stock solely as a result of an acquisition by the Company of
shares of Common Stock, until such time hereafter or thereafter as such
Person shall become the Beneficial Owner (other than by means of a
stock dividend or stock split or by purchase from the Company) of any
additional shares of Common Stock;
(ii) any Person who becomes the Beneficial Owner of 15% or more of
the outstanding shares of Common Stock but who acquired Beneficial
Ownership of shares of Common Stock without any plan or intention to
seek or affect control of the Company, if such Person promptly enters
into an irrevocable commitment to divest, and thereafter promptly
divests (without exercising or retaining any power, including voting,
with respect to such shares), sufficient shares of Common Stock (or
securities convertible into, exchangeable into or exercisable for
Common Stock) so that such Person ceases to be the Beneficial Owner of
15% or more of the outstanding shares of Common Stock;
(iii) any Person who Beneficially Owns shares of Common Stock
consisting solely of one or more of (A) shares of Common Stock
Beneficially Owned pursuant to the grant or exercise of an option
granted to such Person (an "Option Holder") by the Company in connec-
tion with an agreement to merge with, or acquire, the Company entered
into prior to the Flip-in Date, (B) shares of Common Stock (or
securities convertible into, exchangeable into or exercisable for
Common Stock), Beneficially Owned by such Option Holder or its Affil-
iates or Associates at the time of grant of such option, (C) shares of
Common Stock (or securities convertible into, exchangeable into or
exercisable for Common Stock) acquired by Affiliates or Associates of
such Option Holder after the time of such grant which, in the
aggregate, amount to less than 1% of the out standing shares of Common
Stock, and (D) shares of Common Stock (or securities convertible into,
exchange-
-2-
<PAGE>
able into or exercisable for Common Stock) which are held by such
Option Holder in trust accounts, managed accounts and the like or
otherwise held in a fiduciary capacity, that are beneficially owned by
third Persons who are not Affiliates or Associates of such Option
Holder or acting together with such Option Holder to hold such shares,
or which are held by such Person in respect of a debt previously
contracted; and
(iv) the Company, any wholly-owned Subsidiary of the Company, any
employee stock ownership plan or other employee benefit plan of the
Company or a wholly-owned subsidiary of the Company or any employee
stock benefit trust established by the Company ("Employee Plans").
"Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 under the Securities Exchange Act of 1934,
as such Rule is in effect on the date of this Agreement.
A Person shall be deemed the "Beneficial Owner", and to have
"Beneficial Ownership", of, and to "Beneficially Own", any securities as to
which such Person or any of such Person's Affiliates or Associates is or may be
deemed to be the beneficial owner pursuant to Rules 13d-3 and 13d-5 under the
Exchange Act, as such Rules are in effect on the date of this Agreement, as well
as any securities as to which such Person or any of such Person's Affiliates or
Associates has the right to become Beneficial Owner (whether such right is
exercisable immediately or only after the passage of time or the occurrence of
conditions) pursuant to any agreement, arrangement or understanding, or upon the
exercise of conversion rights, exchange rights, rights (other than the Rights),
warrants or options, or otherwise; provided, however, that a Person shall not be
deemed the "Beneficial Owner" of, to have "Beneficial Ownership" of, or to
"Beneficially Own", any security (i) solely because such security has been
tendered pursuant to a tender or exchange offer made by such Person or any of
such Person's Affiliates or Associates until such tendered security is accepted
for payment or exchange, (ii) solely because such Person or any of such Person's
Affiliates or Associates has or shares the power to vote or direct the voting of
such security pursuant to a revocable proxy given in response to a public proxy
or consent solicitation made to more than ten holders of shares of a class of
stock of the Company registered under Section 12 of the Exchange Act and
pursuant to, and in accordance with, the applicable rules and regulations under
the
-3-
<PAGE>
Exchange Act, except if such power (or the arrangements relating thereto) is
then reportable under Item 6 of Schedule 13D under the Exchange Act (or any
similar provision of a comparable or successor report), or (iii) solely because
of the grant by the Company to such Person, in connection with the execution of
an agreement to acquire the Company, of options to acquire such security;
provided, further, that the Warburg Entities shall not be deemed to Beneficially
Own shares of Common Stock owned by their Associates (other than their
Affiliates, general partners, officers and directors), and such Associates
(other than such Affiliates, general partners, officers and directors) shall not
be deemed to Beneficially Own shares of Common Stock owned by the Warburg
Entities. Notwithstanding the foregoing, no officer or director of the Company
shall be deemed to Beneficially Own any securities of any other Person by virtue
of any actions such officer or director takes in such capacity. For purposes of
this Agreement, in determining the percentage of the outstanding shares of
Common Stock with respect to which a Person is the Beneficial Owner, all shares
as to which such Person is deemed the Beneficial Owner shall be deemed
outstanding.
"Business Day" shall mean any day other than a Saturday, Sunday or a
day on which banking institutions in The City of New York or the Commonwealth of
Pennsylvania are generally authorized or obligated by law or executive order to
close.
"close of business" on any given date shall mean the time on such date
(or, if such date is not a Business Day, the time on the next succeeding
Business Day) at which the offices of the transfer agent for the Common Stock
(or, after the Separation Time, the offices of the Rights Agent) are closed to
the public.
"Common Stock" shall mean the shares of Common Stock, par value $.50
per share, of the Company.
"Company" shall have the meaning set forth in the preamble.
"Election to Exercise" shall have the meaning set forth in Section
2.3(d) hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
-4-
<PAGE>
"Exchange Ratio" shall have the meaning set forth in Section 3.1(c)
hereof.
"Exchange Time" shall mean the time at which the right to exercise the
Rights shall terminate pursuant to Section 3.1(c) hereof.
"Exercise Price" shall mean, as of any date, the price at which a
holder may purchase the securities issuable upon exercise of one whole Right.
Until adjustment thereof in accordance with the terms hereof, the Exercise Price
shall equal $56.25 (after giving effect to the June 2, 1997 and May 17, 1999
dividends, each of one share of Common Stock for each share of Common Stock
issued).
"Expansion Factor" shall have the meaning set forth in Section 2.4(a)
hereof.
"Expiration Time" shall mean the earliest of (i) the Exchange Time,
(ii) the Redemption Time, (iii) the close of business on the tenth anniversary
of the Record Time and (iv) immediately prior to the effective time of a
consolidation, merger or share exchange of the Company (A) into another
corporation or (B) with another corporation in which the Company is the
surviving corporation but Common Stock is converted into cash and/or securities
of another corporation, in either case pursuant to an agreement entered into by
the Company prior to a Stock Acquisition Date.
"Flip-in Date" shall mean any Stock Acquisition Date which is not the
result of a Flip-over Transaction or Event.
"Flip-over Entity," for purposes of Section 3.2, shall mean (i) in the
case of a Flip-over Transaction or Event described in clause (A) of the
definition thereof, the Person issuing any securities into which shares of
Common Stock are being converted or exchanged and, if no such securities are
being issued, the other party to such Flip-over Transaction or Event and (ii) in
the case of a Flip-over Transaction or Event referred to in clause (B) of the
definition thereof, the Person receiving the greatest portion of the (i) assets
or (ii) operating income or cash flow being transferred in such Flip-over
Transaction or Event, provided in all cases if such Person is a subsidiary of a
corporation, the parent corporation shall be the Flip-Over Entity.
-5-
<PAGE>
"Flip-over Stock" of any Person shall mean the capital stock (or
similar equity interest) with the greatest voting power in respect of the
election of directors (or other persons similarly responsible for direction of
the business and affairs) of the Flip-Over Entity.
"Flip-over Transaction or Event" shall mean a transaction or series of
transactions on or after a Flip-in Date in which, directly or indirectly, (A)
the Company shall consolidate or merge with, or participate in a share exchange
with any other Person if, at the time of the consolidation, merger or share
exchange or at the time the Company enters into any agreement with respect to
any such consolidation, merger or share exchange, the Acquiring Person Controls
the Board of Directors of the Company and either (i) any terms of or arrangement
concerning the treatment of shares of capital stock in such consolidation,
merger or share exchange relating to the Acquiring Person is not identical to
the terms and arrangements relating to other holders of the Common Stock or (ii)
the Person with whom the transaction or series of transactions occurs is the
Acquiring Person or an Affiliate or Associate of the Acquiring Person, or (B)
the Company shall sell or otherwise transfer (or one or more of its Subsidiaries
shall sell or otherwise transfer) assets of the Company and its Subsidiaries
(taken as a whole) to any Person (other than the Company or one or more of its
wholly owned Subsidiaries) or to two or more such Persons which are Affiliates
or Associates or otherwise acting in concert, if, at the time of the entry by
the Company (or any such Subsidiary) into an agreement with respect to such sale
or transfer of assets, the Acquiring Person Controls the Board of Directors of
the Company. For purposes of the foregoing description, (x) the term "Acquiring
Person" shall include any Acquiring Person and its Affiliates and Associates
(other than the Company) and (y) an Acquiring Person shall be deemed to Control
the Company's Board of Directors when, following a Flip-in Date, the persons who
were directors of the Company (or persons nominated and/or appointed as
directors by vote of a majority of such persons) before the Stock Acquisition
Date shall cease to constitute a majority of the Company's Board of Directors.
"Market Price" per share of any securities on any date shall mean the
average of the daily closing prices per share of such securities (determined as
described below) on each of the 20 consecutive Trading Days through and
including the Trading Day immediately preceding such date;
-6-
<PAGE>
provided, however, that if an event of a type analogous to any of the events
described in Section 2.4 hereof shall have caused the closing prices used to
determine the Market Price on any Trading Days during such period of 20 Trading
Days not to be fully comparable with the closing price on such date, each such
closing price so used shall be appropriately adjusted in order to make it fully
comparable with the closing price on such date. The closing price per share of
any securities on any date shall be the last reported sale price, regular way,
or, in case no such sale takes place or is quoted on such date, the average of
the closing bid and asked prices, regular way, for each share of such securi-
ties, 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, Inc. or, if the securities are not listed or
admitted to trading on the New York Stock Exchange, Inc., as reported in the
principal consolidated transaction reporting system with respect to securities
listed on the principal national securities exchange on which the securities are
listed or admitted to trading or, if the securities are not listed or admitted
to trading on any national securities exchange, as reported by the National
Association of Securities Dealers, Inc. Automated Quotation System or such
other system then in use, or, if on any such date the securities are not listed
or admitted to trading on any national securities exchange or 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 securities selected by the
Board of Directors of the Company; provided, however, that if on any such date
the securities are not listed or admitted to trading on a national securities
exchange or traded in the over-the-counter market, the closing price per share
of such securities on such date shall mean the fair value per share of
securities on such date as determined in good faith by the Board of Directors of
the Company, after consultation with a nationally recognized investment banking
firm, and set forth in a certificate delivered to the Rights Agent.
"Participating Preferred Stock" shall mean the series of Participating
Preferred Stock, par value $1.00 per share, of the Company created by a
Statement Affecting Class or Series of Shares in substantially the form set
forth in Exhibit B hereto appropriately completed.
"Option Holder" shall have the meaning set forth in the definition of
Acquiring Person.
-7-
<PAGE>
"Person" shall mean any individual, firm, partnership, association,
group (as such term is used in Rule 13d-5 under the Securities Exchange Act of
1934, as such Rule is in effect on the date of this Agreement), corporation or
other entity.
"Record Time" shall have the meaning set forth in the Recitals.
"Redemption Price" shall mean an amount (calcu lated to the nearest one
one-hundredth of a cent) equal to the Exercise Price, as in effect at the
Redemption Time, divided by 22,500 (i.e., $0.0025 after giving effect to the
June 2, 1997 and May 17, 1999 dividends, each of one share of Common Stock for
each share of Common Stock issued).
"Redemption Time" shall mean the time at which the right to exercise
the Rights shall terminate pursuant to Section 5.1 hereof.
"Right" shall have the meaning set forth in the Recitals.
"Rights Agent" shall have the meaning set forth in the Preamble.
"Rights Certificate" shall have the meaning set forth in Section 2.3(c)
hereof.
"Rights Register" shall have the meaning set forth in Section 2.7(a)
hereof.
"Rights Registrar" shall have the meaning set forth in Section 2.7(a)
hereof.
"Separation Time" shall mean the close of business on the earlier of
(i) the tenth Business Day (or such later date as the Board of Directors of the
Company may from time to time fix by resolution adopted prior to the Separation
Time that would otherwise have occurred) after the date on which any Person
commences a tender or exchange offer which, if consummated, would result in such
Person's becoming an Acquiring Person and (ii) the Flip-in Date; provided that,
if the foregoing results in the Separation Time being prior to the Record Time,
the Separation Time shall be the Record Time and provided further, that, if any
tender or exchange offer referred to in clause (i) of this definition is
cancelled, terminated or otherwise withdrawn prior to the
-8-
<PAGE>
Separation Time without the purchase of any shares of Common Stock pursuant
thereto, such offer shall be deemed, for purposes of this definition, never to
have been made.
"Stock Acquisition Date" shall mean the first date of public
announcement by the Company (by any means) that a Person has become an Acquiring
Person.
"Subsidiary" of any specified Person shall mean any corporation or
other entity of which a majority of the voting power of the equity securities or
a majority of the equity interest is Beneficially Owned, directly or indirectly,
by such Person.
"Trading Day", when used with respect to any securities, shall mean a
day on which the New York Stock Exchange, Inc. is open for the transaction of
business or, if such securities are not listed or admitted to trading on the New
York Stock Exchange, Inc., a day on which the principal national securities
exchange on which such securities are listed or admitted to trading is open for
the transaction of business or, if such securities are not listed or admitted
to trading on any national securities exchange, a Business Day.
ARTICLE II
THE RIGHTS
----------
2.1 Summary of Rights. As soon as practicable after the Record Time,
the Company will mail a letter summarizing the terms of the Rights to each
holder of record of Common Stock as of the Record Time, at such holder's address
as shown by the records of the Company.
2.2 Rights Associated with Common Stock; Legends. (a) Until the
Separation Time, each share of Common Stock held of record as of the Record Time
and, as provided in Section 2.4, each share of Common Stock issued or sold by
the Company after the Record Time and prior to the Separation Time shall have
associated with it one Right (which shall be evidenced only as described in
Sections 2.1, 2.2(b) and 2.2(c)).
(b) Certificates for certificated shares of Common Stock issued after
the Record Time but prior to the Separation Time shall have impressed on,
printed on, written on or otherwise affixed to them the following legend:
-9-
<PAGE>
"Until the Separation Time (as defined in the Rights Agreement referred
to below), this certificate also evidences and entitles the holder
hereof to certain Rights as set forth in a Shareholder Protection
Rights Agreement, dated as of October 15, 1996 (as such may be amended
from time to time, the "Rights Agreement"), between Mellon Bank
Corporation (the "Company") and Mellon Bank, N.A., as Rights Agent, the
terms of which are hereby incorporated herein by reference and a copy
of which is on file at the principal executive offices of the Company.
Under certain circumstances, as set forth in the Rights Agreement,
such Rights may be redeemed, may become exercisable for securities or
assets of the Company or securities of another entity, may be exchanged
for shares of Common Stock or other securities or assets of the
Company, may expire, may become void (if they are "Beneficially Owned"
by an "Acquiring Person" or an Affiliate or Associate thereof, as such
terms are defined in the Rights Agreement, or by any transferee of any
of the foregoing) or may be evidenced by separate certificates and may
no longer be evidenced by this certificate. The Company will mail or
arrange for the mailing of a copy of the Rights Agreement to the holder
of this certificate without charge after the receipt of a written
request therefor."
Until the Separation Time, certificates representing certificated shares of
Common Stock that are issued and outstanding at the Record Time shall evidence
one Right for each share of Common Stock evidenced thereby notwithstanding the
absence of the foregoing legend.
(c) Any confirmation or advice by the Company issued after the Record
Time but prior to the Separation Time of issuance or transfer of uncertificated
shares of Common Stock shall contain a notice of the existence of the Rights
associated with such shares of Common Stock. The form of such notice shall be as
the Company may elect from time to time. Without limiting the generality of the
foregoing, such notice may take the form of (i) a general statement to the
effect that rights may be attached to such shares and that a shareholder may
obtain a full copy of the text of such rights free of charge from the Company or
(ii) a statement similar to the following:
-10-
<PAGE>
"Until the Separation Time (as defined in the Agreement referred to
below), holders of the Company's Common Stock are entitled to certain
Rights as set forth in a Shareholder Protection Rights Agreement, dated
as of October 15, 1996 (as amended from time to time), between the
Company and Mellon Bank, N.A., as Rights Agent. A copy of the
Agreement, which is incorporated herein by reference, is on file at the
Company's executive offices and will be mailed without charge to any
shareholder upon written request. Under certain circumstances, the
Rights may be redeemed, may become exercisable for securities or assets
of the Company or another entity, may be exchanged for Common Stock or
other securities or assets of the Company, may expire, may become void
(if they are "Beneficially Owned" by an "Acquiring Person" or an
Affiliate or Associate thereof, as such terms are defined in the
Agreement, or by any transferee of any of the foregoing) or may be
evidenced by separate certificates and may no longer be attached to the
Common Stock."
Uncertificated shares of Common Stock issued and outstanding at the Record Time
(if any) shall, until the Separation Time, entitle the holder to one Right for
each share of Common Stock notwithstanding the absence of any such notice on any
confirmation or advice issued on or before the Record Time.
2.3 Exercise of Rights; Separation of Rights. (a) Subject to Sections
3.1, 5.1 and 5.10 and subject to adjustment as herein set forth, each Right will
entitle the holder thereof, after the Separation Time and prior to the
Expiration Time, to purchase, for the Exercise Price, one one-hundredth of a
share of Participating Preferred Stock.
(b) Until the Separation Time, (i) no Right may be exercised and (ii)
each Right will be associated with a share of Common Stock and will be
transferable only together with, and will be transferred by a transfer of, such
associated share. Notwithstanding any other provision of this Agreement, any
Rights held by the Company or any of its Subsidiaries (other than Rights held in
a fiduciary capacity or pursuant to any Employee Plans) shall not be exercisable
by the Company or any such Subsidiary.
-11-
<PAGE>
(c) Subject to the terms and conditions hereof, after the Separation
Time and prior to the Expiration Time, the Rights (i) may be exercised and (ii)
may be transferred independent of shares of Common Stock. Promptly following the
Separation Time, the Rights Agent will mail to each holder of record of Common
Stock as of the Separation Time (other than any Person whose Rights have become
void pursuant to Section 3.1(b)), at such holder's address as shown by the
records of the Company (the Company hereby agreeing to furnish copies of such
records to the Rights Agent for this purpose), (x) a certificate (a "Rights
Certificate") in substantially the form of Exhibit A hereto appropriately
completed, representing the number of Rights held by such holder at the
Separation Time and having 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 law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any national securities
exchange or quotation system on which the Rights may from time to time be listed
or traded, or to conform to usage, and (y) a disclosure statement describing the
Rights.
(d) Subject to the terms and conditions hereof, Rights may be exercised
on any Business Day after the Separation Time and prior to the Expiration Time
by submitting to the Rights Agent the Rights Certificate evidencing such Rights
with an Election to Exercise (an "Election to Exercise") substantially in the
form attached to the Rights Certificate duly completed, accompanied by payment
in cash, or by certified or official bank check or money order payable to the
order of the Company, of a sum equal to the Exercise Price multiplied by the
number of Rights being exercised and a sum sufficient to cover any transfer tax
or charge which may be payable in respect of any transfer involved in the
transfer or delivery of Rights Certificates or the issuance or delivery of
shares (or certificates for shares or depositary receipts or both) in a name
other than that of the holder of the Rights being exercised.
(e) Upon receipt of a Rights Certificate, with an Election to Exercise
accompanied by payment as set forth in Section 2.3(d), and subject to the terms
and conditions hereof, the Rights Agent will thereupon promptly (i)(A)
requisition from a transfer agent shares or other securities to be purchased,
including, in case so requested by the registered holder of the Rights
Certificate or if elected by
-12-
<PAGE>
the Company, certificates representing the same (the Company hereby irrevocably
authorizing its transfer agents to comply with all such requisitions), and (B)
if the Company elects pursuant to Section 5.5 hereof not to issue fractional
shares, requisition from the depositary selected by the Company depositary
receipts representing the fractional shares to be purchased or requisition from
the Company the amount of cash to be paid in lieu of fractional shares in
accordance with Section 5.5 and (ii) after receipt of such shares, certificates,
depositary receipts and/or cash, deliver the same to or upon the order of the
registered holder of such Rights Certificate, registered (in the case of shares,
certificates and/or depositary receipts) in such name or names as may be
designated by such holder.
(f) In case the holder of any Rights shall exercise less than all the
Rights evidenced by such holder's Rights Certificate, a new Rights Certificate
evidencing the Rights remaining unexercised will be issued by the Rights Agent
to such holder or to such holder's duly authorized assigns.
(g) The Company covenants and agrees that it will (i) cause to be kept
available until the Expiration Time out of its authorized and unissued shares of
capital stock a number of shares of Participating Preferred Stock that will be
sufficient to permit the exercise in full of all outstanding Rights; (ii) take
all such action as may be necessary to ensure that all shares delivered upon
exercise of Rights shall, at the time of delivery thereof (subject to payment of
the Exercise Price), be duly and validly authorized, executed, issued and
delivered and fully paid and nonassessable; (iii) take all such action as may be
necessary to comply with any applicable requirements of the Securities Act of
1933 or the Exchange Act, and the rules and regulations thereunder, and any
other applicable law, rule or regulation, in connection with the issuance of any
shares upon exercise of Rights; and (iv) pay when due and payable any and all
federal and state transfer taxes and charges which may be payable in respect of
the original issuance or delivery of the Rights Certificates or of any shares
issued upon the exercise of Rights, provided that the Company shall not be
required to pay any transfer tax or charge which may be payable in respect of
any transfer involved in the transfer or delivery of Rights Certificates or the
issuance or delivery of shares in a name other than that of the holder of the
Rights being transferred or exercised.
-13-
<PAGE>
2.4 Adjustments to Exercise Price; Number of Rights. (a) In the event
the Company shall at any time after the Record Time and prior to the Separation
Time (i) declare or pay a dividend on Common Stock payable in Common Stock, (ii)
subdivide the outstanding Common Stock or (iii) combine the outstanding Common
Stock into a smaller number of shares of Common Stock, (x) the Exercise Price in
effect after such adjustment will be equal to the Exercise Price in effect
immediately prior to such adjustment divided by the number of shares of Common
Stock (the "Expansion Factor") that a holder of one share of Common Stock imme-
diately prior to such dividend, subdivision or combination would hold thereafter
as a result thereof and (y) each Right held prior to such adjustment will become
that number of Rights equal to the Expansion Factor, and the adjusted number of
Rights will be deemed to be distributed among the shares of Common Stock with
respect to which the original Rights were associated (if they remain
outstanding) and the shares issued in respect of such dividend, subdivision or
combination, so that each such share of Common Stock will have exactly one Right
associated with it. Each adjustment made pursuant to this paragraph shall be
made as of the payment or effective date for the applicable dividend,
subdivision or combination.
In the event the Company shall at any time after the Record Time and
prior to the Separation Time issue or sell any shares of Common Stock otherwise
than in a transaction referred to in the preceding paragraph, each such share of
Common Stock so issued or sold shall automatically have one new Right associated
with it (which Right shall be evidenced as described in Section 2.2(b) or (c),
as the case may be). To the extent provided in Section 5.3(b), Rights shall be
issued by the Company in respect of shares of Common Stock that are issued or
sold by the Company after the Separation Time.
(b) In the event the Company shall at any time after the Record Time
and prior to the Separation Time issue or distribute any securities or assets in
respect of, in lieu of or in exchange for Common Stock (other than pursuant to a
regular periodic cash dividend or a dividend paid solely in Common Stock)
whether by dividend, in a reclassification or recapitalization (including any
such transaction involving a merger, consolidation or share exchange), or
otherwise, the Company shall make such adjustments, if any, in the Exercise
Price, number of Rights and/or securities or other property purchasable upon
exercise of
-14-
<PAGE>
Rights as the Board of Directors of the Company, in its sole discretion, may
deem to be appropriate under the circumstances in order to adequately protect
the interests of the holders of Rights generally, and the Company and the Rights
Agent shall amend this Agreement as necessary to provide for such adjustments.
(c) Each adjustment to the Exercise Price made pursuant to this Section
2.4 shall be calculated to the nearest cent. Whenever an adjustment to the
Exercise Price is made pursuant to this Section 2.4, the Company shall (i)
promptly prepare a certificate setting forth such adjustment and a brief
statement of the facts accounting for such adjustment and (ii) promptly file
with the Rights Agent and with each transfer agent for the Common Stock a copy
of such certificate.
(d) Rights Certificates shall represent the securities purchasable
under the terms of this Agreement, including any adjustment or change in the
securities purchasable upon exercise of the Rights, even though such
certificates may continue to express the securities purchasable at the time of
issuance of the initial Rights Certificates.
2.5 Date on Which Exercise is Effective. Each person in whose name any
shares are issued upon the exercise of Rights shall for all purposes be deemed
to have become the holder of record of the shares on the date upon which the
Rights Certificate evidencing such Rights was duly surrendered and payment of
the Exercise Price for such Rights (and any applicable taxes and other
governmental charges payable by the exercising holder hereunder) was made;
provided, however, that if the date of such surrender and payment is a date upon
which the stock transfer books of the Company are closed, such person shall be
deemed to have become the record holder of such shares on, and such certificate
shall be dated, the next succeeding Business Day on which the stock transfer
books of the Company are open.
2.6 Execution, Authentication, Delivery and Dating of Rights
Certificates. (a) The Rights Certificates shall be executed on behalf of the
Company by its Chairman of the Board, President, Chief Executive Officer or one
of its Vice Chairmen, under its corporate seal reproduced thereon attested by
its Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Rights Certificates may be manual or facsimile.
-15-
<PAGE>
Rights Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the countersignature and delivery of such Rights
Certificates.
Promptly after the Company learns of the Separation Time, the Company
will notify the Rights Agent of such Separation Time and will deliver Rights
Certificates executed by the Company to the Rights Agent for countersignature,
and, subject to Section 3.1(b), the Rights Agent shall manually countersign and
deliver such Rights Certificates to the holders of the Rights pursuant to
Section 2.3(c) hereof. No Rights Certificate shall be valid for any purpose
unless manually countersigned by the Rights Agent.
(b) Each Rights Certificate shall be dated the date of countersignature
thereof.
2.7 Registration, Registration of Transfer and Exchange. (a) After the
Separation Time, the Company will cause to be kept a register (the "Rights
Register") in which, subject to such reasonable regulations as it may prescribe,
the Company will provide for the registration and transfer of Rights. The Rights
Agent is hereby appointed "Rights Registrar" for the purpose of maintaining the
Rights Register for the Company and registering Rights and transfers of Rights
after the Separation Time as herein provided, provided that the Rights Agent is
hereby authorized to appoint ChaseMellon Shareholder Services, L.L.C. as Rights
Registrar (in which capacity such Rights Registrar shall be entitled to the
benefits of Article IV hereof as if it were Rights Agent). In the event that the
Rights Agent shall cease to be the Rights Registrar, the Rights Agent will have
the right to examine the Rights Register at all reasonable times after the
Separation Time.
After the Separation Time and prior to the Expiration Time, upon
surrender for registration of transfer or exchange of any Rights Certificate,
and subject to the provisions of Section 2.7(c) and (d), the Company will
execute, and the Rights Agent will countersign and deliver, in the name of the
holder or the designated transferee or transferees, as required pursuant to the
holder's instructions, one or more new Rights Certificates evidencing the same
aggregate number of Rights as did the Rights Certificate so surrendered.
-16-
<PAGE>
(b) Except as otherwise provided in Section 3.1(b), all Rights issued
upon any registration of transfer or exchange of Rights Certificates shall be
the valid obligations of the Company, and such Rights shall be entitled to the
same benefits under this Agreement as the Rights surrendered upon such
registration of transfer or exchange.
(c) Every Rights Certificate surrendered for registration of transfer
or exchange shall be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company or the Rights Agent, as the case
may be, duly executed by the holder thereof or such holder's attorney duly
authorized in writing. As a condition to the issuance of any new Rights
Certificate under this Section 2.7, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto.
(d) The Company shall not be required to register the transfer or
exchange of any Rights after such Rights have become void under Section 3.1(b),
been exchanged under Section 3.1(c) or been redeemed or terminated under Section
5.1.
2.8 Mutilated, Destroyed, Lost and Stolen Rights Certificates. (a) If
any mutilated Rights Certificate is surrendered to the Rights Agent prior to the
Expiration Time, then, subject to Sections 3.1(b), 3.1(c) and 5.1, the Company
shall execute and the Rights Agent shall countersign and deliver in exchange
therefor a new Rights Certificate evidencing the same number of Rights as did
the Rights Certificate so surrendered.
(b) If there shall be delivered to the Company and the Rights Agent
prior to the Expiration Time (i) evidence to their satisfaction of the
destruction, loss or theft of any Rights Certificate and (ii) such security or
indemnity as may be required by them to save each of them and any of their
agents harmless, then, subject to Sections 3.1(b), 3.1(c) and 5.1 and in the
absence of notice to the Company or the Rights Agent that such Rights
Certificate has been acquired by a bona fide purchaser, the Company shall
execute and upon its request the Rights Agent shall countersign and deliver, in
lieu of any such destroyed, lost or stolen Rights Certificate, a new Rights
Certificate evidencing the same number of Rights as did the Rights Certificate
so destroyed, lost or stolen.
-17-
<PAGE>
(c) As a condition to the issuance of any new Rights Certificate under
this Section 2.8, the Company may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Rights
Agent) connected therewith.
(d) Every new Rights Certificate issued pursuant to this Section 2.8 in
lieu of any destroyed, lost or stolen Rights Certificate shall evidence an
original additional contractual obligation of the Company, whether or not the
destroyed, lost or stolen Rights Certificate shall be at any time enforceable by
anyone, and subject to Section 3.1(b), shall be entitled to all the benefits of
this Agreement equally and proportionately with any and all other Rights duly
issued hereunder.
2.9 Persons Deemed Owners. Prior to due presentment of a Rights
Certificate (or, prior to the Separation Time, the associated Common Stock
certificate for certificated shares or duly completed transfer instructions for
uncertificated shares) for registration of transfer, the Company, the Rights
Agent and any agent of the Company or the Rights Agent may deem and treat the
person in whose name such Rights Certificate (or, prior to the Separation Time,
such share of Common Stock) is registered as the absolute owner thereof and of
the Rights evidenced thereby (or associated therewith) for all purposes
whatsoever, including the payment of the Redemption Price, and neither the
Company nor the Rights Agent shall be affected by any notice to the contrary. As
used in this Agreement, unless the context otherwise requires, the term "holder"
of any Rights shall mean the registered holder of such Rights (or, prior to the
Separation Time, the associated shares of Common Stock).
2.10 Delivery and Cancellation of Certificates. All Rights Certificates
surrendered upon exercise or for redemption, registration of transfer or
exchange shall, if surrendered to any person other than the Rights Agent, be
delivered to the Rights Agent and, in any case, shall be promptly cancelled by
the Rights Agent. The Company may at any time deliver to the Rights Agent for
cancellation any Rights Certificates previously countersigned and delivered
hereunder which the Company may have acquired in any manner whatsoever, and all
Rights Certificates so delivered shall be promptly cancelled by the Rights
Agent. No Rights Certificates shall be countersigned in lieu of or in exchange
for any Rights Certificates cancelled as provided
-18-
<PAGE>
in this Section 2.10, except as expressly permitted by this Agreement. The
Rights Agent shall destroy all cancelled Rights Certificates and deliver a
certificate of destruction to the Company.
2.11 Agreement of Rights Holders. Every holder of Rights by accepting
the same consents and agrees with the Company and the Rights Agent and with
every other holder of Rights that:
(a) prior to the Separation Time, each Right will be transferable
only together with, and will be transferred by a transfer of, the
associated share of Common Stock;
(b) after the Separation Time, the Rights Certificates will be
transferable only on the Rights Register as provided herein;
(c) prior to due presentment of a Rights Certificate (or, prior
to the Separation Time, the associated Common Stock certificate for
certificated shares or duly completed transfer instructions for
uncertificated shares) for registration of transfer, the Company, the
Rights Agent and any agent of the Company or the Rights Agent may deem
and treat the person in whose name such Rights Certificate (or, prior
to the Separation Time, such share of Common Stock) is registered as
the absolute owner thereof and of the Rights evidenced thereby (or
associated therewith) for all purposes whatsoever, and neither the
Company nor the Rights Agent shall be affected by any notice to the
contrary;
(d) Rights beneficially owned by certain Persons will, under the
circumstances set forth in Section 3.1(b), become void; and
(e) this Agreement may be supplemented or amended from time to
time pursuant to Section 2.4(b) or 5.4 hereof.
-19-
<PAGE>
ARTICLE III
ADJUSTMENTS TO THE RIGHTS
IN THE EVENT OF CERTAIN TRANSACTIONS
------------------------------------
3.1 Flip-in. (a) In the event that prior to the Expiration Time a
Flip-in Date shall occur, except as provided in this Section 3.1, each Right
shall constitute the right to purchase from the Company, upon exercise thereof
in accordance with the terms hereof (but subject to Section 5.10), that number
of shares of Common Stock having an aggregate Market Price on the Stock
Acquisition Date equal to twice the Exercise Price for an amount in cash equal
to the Exercise Price (such right to be appropriately adjusted in order to
protect the interests of the holders of Rights generally in the event that on or
after such Stock Acquisition Date an event of a type analogous to any of the
events described in Section 2.4(a) or (b) shall have occurred with respect to
the Common Stock).
(b) Notwithstanding the foregoing, any Rights that are or were
Beneficially Owned, on or after the Stock Acquisition Date on which an Acquiring
Person became such, by such Acquiring Person or by an Affiliate or Associate
thereof or by any transferee, direct or indirect, of any of the foregoing shall
become void and any holder of such Rights (including transferees) shall
thereafter have no right to exercise or transfer such Rights under any provi-
sion of this Agreement. If any Rights Certificate is presented for assignment or
exercise and the Person presenting the same will not complete the certification
set forth at the end of the form of assignment or notice of election to exercise
and provide such additional evidence of the identity of the Beneficial Owner and
its Affiliates and Associates (or former Beneficial Owners and their Affiliates
and Associates) as the Company shall reasonably request, then the Company shall
be entitled conclusively to deem the Beneficial Owner thereof to be an Acquiring
Person or an Affiliate or Associate thereof or a transferee of any of the
foregoing and accordingly will deem the Rights evidenced thereby to be void and
not transferable or exercisable.
(c) The Board of Directors of the Company may, at its option, at any
time after a Flip-in Date, to the fullest extent that applicable law would not
prohibit Rights owned by certain Persons referred to in Section 3.1(b) becoming
void pursuant to the provisions thereof, elect to exchange all (but not less
than all) the then outstanding Rights
-20-
<PAGE>
(which shall not include Rights that have become void pursuant to the provisions
of Section 3.1(b)) for shares of Common Stock at an exchange ratio of one share
of Common Stock per Right, appropriately adjusted in order to protect the
interests of holders of Rights generally in the event that after the Separation
Time an event of a type analogous to any of the events described in Section
2.4(a) or (b) shall have occurred with respect to the Common Stock (such
exchange ratio, as adjusted from time to time, being herein after referred to as
the "Exchange Ratio").
Immediately upon the action of the Board of Directors of the Company
electing to exchange the Rights, without any further action and without any
notice, the right to exercise the Rights will terminate and each Right (other
than Rights that have become void pursuant to Section 3.1(b)) will thereafter
represent only the right to receive a number of shares of Common Stock equal to
the Exchange Ratio. Promptly after the action of the Board of Directors electing
to exchange the Rights, the Company shall give notice thereof (specifying the
steps to be taken to receive shares of Common Stock in exchange for Rights) to
the Rights Agent and the holders of the Rights (other than Rights that have
become void pursuant to Section 3.1(b)) outstanding immediately prior thereto by
mailing such notice in accordance with Section 5.9.
Each Person in whose name any shares are issued upon the exchange of
Rights pursuant to this Section 3.1(c) or Section 3.1(d) shall for all purposes
be deemed to have become the holder of record of the shares on, and any
certificate or confirmation or advice of issuance relating to such shares shall
be dated, the date upon which the Rights Certificate evidencing such Rights was
duly surrendered and payment of any applicable taxes and other governmental
charges payable by the holder was made; provided, however, that if the date of
such surrender and payment is a date upon which the stock transfer books of the
Company are closed, such Person shall be deemed to have become the record holder
of such shares on, and any such certificate, advice or confirmation shall be
dated, the next succeeding Business Day on which the stock transfer books of the
Company are open.
(d) Whenever the Company shall become obligated under Section 3.1(a) or
(c) to issue shares of Common Stock upon exercise of or in exchange for Rights,
the Company, at its option, may substitute therefor shares of Participating
-21-
<PAGE>
Preferred Stock, at a ratio of one one-hundredth of a share of Participating
Preferred Stock for each share of Common Stock so issuable.
(e) In the event that there shall not be sufficient treasury shares or
authorized but unissued shares of Common Stock or Participating Preferred Stock
of the Company to permit the exercise or exchange in full of the Rights in
accordance with Section 3.1(a) or (c), and the Company elects not to, or is
otherwise unable to, make the exchange referred to in Section 3.1(c), the
Company shall take such action as shall be necessary to ensure and provide, to
the extent permitted by applicable law and any agreements or instruments in
effect on the Stock Acquisition Date to which it is a party, that each Right
shall there after constitute the right to receive, (x) at the Company's option,
either (A) in return for the Exercise Price, debt or equity securities or other
assets (or a combination thereof) having a fair value equal to twice the
Exercise Price, or (B) without payment of consideration (except as otherwise
required by applicable law), debt or equity securities or other assets (or a
combination thereof) having a fair value equal to the Exercise Price, or (y) if
the Board of Directors of the Company elects to exchange the Rights in accor
dance with Section 3.1(c), debt or equity securities or other assets (or a
combination thereof) having a fair value equal to the product of the Market
Price of a share of Common Stock on the Flip-in Date times the Exchange Ratio in
effect on the Flip-in Date, where in any case set forth in (x) or (y) above the
fair value of such debt or equity securities or other assets shall be as
determined in good faith by the Board of Directors of the Company, after
consultation with a nationally recognized investment banking firm.
3.2 Flip-over. (a) Prior to the Expiration Time, the Company shall not
enter into any agreement with an Acquiring Person with respect to, consummate or
permit to occur any Flip-over Transaction or Event unless and until it shall
have entered into a supplemental agreement with the Flip-over Entity, for the
benefit of the holders of the Rights, providing that, upon consummation or
occurrence of the Flip-over Transaction or Event (i) each Right shall thereafter
constitute the right to purchase from the Flip-over Entity, upon exercise
thereof in accordance with the terms hereof, that number of shares of Flip-over
Stock of the Flip-over Entity having an aggregate Market Price on the date of
consummation or occurrence of such Flip-over Trans-
-22-
<PAGE>
action or Event equal to twice the Exercise Price for an amount in cash equal to
the Exercise Price (such right to be appropriately adjusted in order to protect
the interests of the holders of Rights generally in the event that after such
date of consummation or occurrence an event of a type analogous to any of the
events described in Section 2.4(a) or (b) shall have occurred with respect to
the Flip-over Stock) and (ii) the Flip-over Entity shall thereafter be liable
for, and shall assume, by virtue of such Flip-over Transaction or Event and such
supplemental agreement, all the obligations and duties of the Company pursuant
to this Agreement. The provisions of this Section 3.2 shall apply to successive
Flip-over Transactions or Events.
(b) Prior to the Expiration Time, unless the Rights will be redeemed
pursuant to Section 5.1 hereof in connection therewith, the Company shall not
enter into any agreement with respect to, consummate or permit to occur any
Flip-over Transaction or Event if at the time thereof there are any rights,
warrants or securities outstanding or any other arrangements, agreements or
instruments which would eliminate or otherwise diminish in any material respect
the benefits intended to be afforded by this Rights Agreement to the holders of
Rights upon consummation of such transaction.
ARTICLE IV
THE RIGHTS AGENT
----------------
4.1 General. (a) The Company hereby appoints the Rights Agent to act as
agent for the Company in accor dance with the terms and conditions hereof, and
the Rights Agent hereby accepts such appointment. The Company agrees to pay to
the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and other disbursements incurred in the administration
and execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent 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 to be done 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.
-23-
<PAGE>
(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 certificate for
securities purchasable upon exercise of Rights, Rights Certificate, certificate
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.
4.2 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 is a party, will be the successor to the Rights Agent under this Agreement
without the execution or filing of any paper or any further act on the part of
any of the parties hereto, provided that such corporation would be eligible for
appointment as a successor Rights Agent under the provisions of Section 4.4
hereof. In case at the time such successor Rights Agent succeeds to the agency
created by this Agreement any of the Rights Certificates have been
countersigned but not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Rights Certi-
ficates so countersigned; and in case at that time any of the Rights Certifi-
cates have not been countersigned, any successor Rights Agent may countersign
such Rights Certificates either in the name of the predecessor Rights Agent or
in the name of the successor Rights Agent; and in all such cases such Rights
Certificates will 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 is 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.
-24-
<PAGE>
4.3 Duties of Rights Agent. The Rights Agent undertakes the duties and
obligations imposed by this Agree ment 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 will 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 deems it necessary or desirable that any fact or
matter be proved or established by the Company prior to taking or
suffering any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically prescribed) may be
deemed to be conclusively proved and established by a certificate
signed by a person believed by the Rights Agent to be the Chairman of
the Board, the President, the Chief Executive Officer or any Vice
Chairman and by the Treasurer or any Assistant Treasurer or the
Secretary or any Assistant Secretary of the Company and delivered to
the Rights Agent; and such certificate will 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 will be liable hereunder only for its own
negligence, bad faith or willful misconduct.
(d) The Rights Agent will not be liable for or by reason of any of
the statements of fact or recitals contained in this Agreement or in
the certificates for securities purchasable upon exercise of Rights or
the Rights Certificates (except its countersignature thereof) or be
required to verify the same, but all such statements and recitals are
and will be deemed to have been made by the Company only.
(e) The Rights Agent will not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery
hereof (except the due authorization, execution and delivery hereof by
-25-
<PAGE>
the Rights Agent) or in respect of the validity or execution of any
certificate for securities purchasable upon exercise of Rights or
Rights Certificates (except its countersignature thereof); nor will it
be responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any Rights Certificate; nor
will it be responsible for any change in the exercisability of the
Rights (including the Rights becoming void pursuant to Section 3.1(b)
hereof) or any adjustment required under the provisions of Section 2.4,
3.1 or 3.2 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 after receipt of the certificate contemplated by Section 2.4
describing any such adjustment); nor will it by any act hereunder be
deemed to make any representation or warranty as to the authorization
or reservation of any securities purchasable upon exercise of Rights or
any Rights or as to whether any securities purchasable upon exercise of
Rights will, when issued, be duly and validly authorized, executed,
issued and delivered and fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge
and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances
as may reasonably be required by the Rights Agent for the carrying out
or performing by the Rights Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder
from any person believed by the Rights Agent to be the Chairman of the
Board, the President, Chief Executive Officer or any Vice Chairman or
the Secretary or any Assistant Secretary or the Treasurer or any
Assistant Treasurer of the Company, and to apply to such persons for
advice or instructions in connection with its duties, and it shall not
be liable for any action taken or suffered by it in good faith in
accordance with instructions of any such person.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy,
-26-
<PAGE>
sell or deal in Common Stock, 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 will not
be answerable or accountable for any act, default, neglect or
misconduct of any such attorneys or agents or for any loss to the
Company resulting from any such act, default, neglect or misconduct,
provided reasonable care was exercised in the selection and continued
employment thereof.
4.4 Change of Rights Agent. The Rights Agent may resign and be
discharged from its duties under this Agreement upon 90 days' notice (or such
lesser notice as is acceptable to the Company) in writing mailed to the Company
and to each transfer agent of Common Stock by registered or certified mail, and
to the holders of the Rights in accordance with Section 5.9. The Company may
remove the Rights Agent upon 30 days' notice in writing, mailed to the Rights
Agent and to each transfer agent of the Common Stock by registered or certified
mail, and to the holders of the Rights in accordance with Section 5.9. If the
Rights Agent should resign or be removed or otherwise become incapable of
acting, the Company will appoint a successor to the Rights Agent. If the Company
fails to make such appointment within a period of 30 days after 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 any Rights (which
holder shall, with such notice, submit such holder's Rights Certificate for
inspection by the Company), then the holder of any Rights may apply to any
court of competent jurisdiction for the appointment of a new Rights Agent. Any
successor Rights Agent, whether appointed by the Company or by such a court,
shall be a corporation organized and doing business under the laws of the United
States or of the Commonwealth of Pennsylvania, in good standing, having its
principal office in the Commonwealth of Pennsylvania, which is authorized under
such laws to exer-
-27-
<PAGE>
cise the powers of the Rights Agent contemplated by this Agreement and is
subject to supervision or examination by federal or state authority and which
has at the time of its appointment as Rights Agent a combined capital and
surplus of at least $50,000,000. After appointment, the successor Rights Agent
will 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 will file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Stock, and mail a notice thereof in writing to the holders of the
Rights. Failure to give any notice provided for in this Section 4.4, 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.
ARTICLE V
MISCELLANEOUS
-------------
5.1 Redemption. (a) The Board of Directors of the Company may, at its
option, at any time prior to the close of business on the Flip-In Date, elect to
redeem all (but not less than all) the then outstanding Rights at the Redemption
Price and the Company, at its option, may pay the Redemption Price either in
cash or shares of Common Stock or other securities of the Company deemed by the
Board of Directors, in the exercise of its sole discretion, to be at least
equivalent in value to the Redemption Price.
(b) Immediately upon the action of the Board of Directors of the
Company electing to redeem the Rights (or, if the resolution of the Board of
Directors electing to redeem the Rights states that the redemption will not be
effective until the occurrence of a specified future time or event, upon the
occurrence of such future time or event), without any further action and without
any notice, the right to exercise the Rights will terminate and each Right will
thereafter represent only the right to receive the Redemption Price in cash or
securities, as determined by the Board of Directors. Promptly after the Rights
are redeemed, the Company shall give notice of such redemption to the Rights
-28-
<PAGE>
Agent and the holders of the then outstanding Rights by mailing such notice in
accordance with Section 5.9.
5.2 Expiration. The Rights and this Agreement shall expire at the
Expiration Time and no Person shall have any rights pursuant to this Agreement
or any Right after the Expiration Time, except, if the Rights are exchanged or
redeemed, as provided in Section 3.1(c), 3.1(d), 3.1(e) or 5.1.
5.3 Issuance of New Rights Certificates. (a) 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 its Board of Directors to reflect any adjustment or change in
the number or kind or class of shares of stock purchasable upon exercise of
Rights made in accordance with the provisions of this Agreement.
(b) In addition, in connection with the issuance or sale of shares of
Common Stock by the Company following the Separation Time and prior to the
Expiration Time pursuant to the terms of securities convertible or redeemable
into shares of Common Stock or to options, in each case issued or granted prior
to, and outstanding at, the Separation Time, the Company shall issue to the
holders of such shares of Common Stock, Rights Certificates representing the
appropriate number of Rights in connection with the issuance or sale of such
shares of Common Stock; provided, however, in each case, (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 to the Person to whom such
Rights Certificates would be issued, (ii) no such Rights Certificates shall be
issued if, and to the extent that, appropriate adjustment shall have otherwise
been made in lieu of the issuance thereof, and (iii) the Company shall have no
obligation to distribute Rights Certificates to any Acquiring Person or
Affiliate or Associate of an Acquiring Person or any transferee of any of the
foregoing.
5.4 Supplements and Amendments. The Company and the Rights Agent may
from time to time supplement or amend this Agreement without the approval of any
holders of Rights (i) in any respect prior to the Flip-in Date, (ii) to make any
changes on or after the Flip-in Date that the Company may deem necessary or
desirable and which shall not materi-
-29-
<PAGE>
ally adversely affect the interests of the holders of Rights generally or (iii)
in order to cure any ambiguity or to correct or supplement any provision
contained herein which may be inconsistent with any other provisions herein or
otherwise defective. The Rights Agent will duly execute and deliver any
supplement or amendment hereto requested by the Company which satisfies the
terms of the preceding sentence.
5.5 Fractional Shares. If the Company elects not to issue fractional
shares upon exercise or redemption of Rights, the Company shall, in lieu
thereof, (a) evidence such fractional shares by depositary receipts issued
pursuant to an appropriate agreement between the Company and a depositary
selected by it, provided that such agreement shall provide that each holder of a
depositary receipt shall have all of the rights, privileges and preferences to
which he would be entitled as a beneficial owner of such fractional share, or
(b) pay to the registered holder of such Rights the appropriate fraction of the
Market Price per share in cash.
5.6 Rights of Action. Subject to the terms of this Agreement, rights of
action in respect of this Agreement, other than rights of action vested solely
in the Rights Agent, are vested in the respective holders of the Rights; and any
holder of any Rights, without the consent of the Rights Agent or of the holder
of any other Rights, may, on such holder's own behalf and for such holder's own
bene fit and the benefit of other holders of Rights, enforce, and may institute
and maintain any suit, action or proceeding against the Company to enforce, or
otherwise act in respect of, such holder's right to exercise such holder's
Rights in the manner provided in such holder's 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
will be entitled to specific performance of the obligations under, and
injunctive relief against actual or threatened violations of the obligations of
any Person subject to, this Agreement.
5.7 Holder of Rights Not Deemed a Shareholder. No holder, as such, of
any Rights shall be entitled to vote, receive dividends or be deemed for any
purpose the holder of shares or any other securities which may at any time be
issuable on the exercise of such Rights, nor shall anything contained herein or
in any Rights Certificate be construed
-30-
<PAGE>
to confer upon the holder of any Rights, as such, any of the rights of a
shareholder of the Company or any right to vote for the election of directors or
upon any matter submitted to shareholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of meetings or
other actions affecting shareholders (except as provided in Section 5.8 hereof),
or to receive dividends or subscription rights, or otherwise, until such Rights
shall have been exercised or exchanged in accordance with the provisions hereof.
5.8 Notice of Proposed Actions. In case the Company shall propose after
the Separation Time and prior to the Expiration Time (i) to effect or permit (in
cases where the Company's permission is required) occurrence of any Flip-in Date
or Flip-over Transaction or Event or (ii) to effect the liquidation, dissolution
or winding up of the Company, then, in each such case, the Company shall give to
each holder of a Right, in accordance with Section 5.9 hereof, a notice of such
proposed action, which shall specify the Flip-in Date or the date on which such
Flip-over Transaction or Event, liquidation, dissolution, or winding up is to
take place, and such notice shall be so given at least 20 Business Days prior to
the date of the taking of such proposed action.
5.9 Notices. Notices or demands authorized or required by this
Agreement to be given or made by the Rights Agent or by the holder of any Rights
to or on the Company shall be sufficiently given or made if delivered or sent by
first-class mail, postage prepaid, addressed (until another address is filed in
writing with the Rights Agent) as follows:
Mellon Bank Corporation
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258
Attention: General Counsel
Any notice or demand authorized or required by this Agreement to be given or
made by the Company or by the holder of any Rights to or on the Rights Agent
shall be sufficiently given or made if delivered or sent by first-class mail,
postage prepaid, addressed (until another address is filed in writing with the
Company) as follows:
-31-
<PAGE>
Mellon Bank, N.A.
One Mellon Bank Center
Room 4826
Pittsburgh, Pennsylvania 15258
Attention: Corporate Secretarial Services
Notices or demands authorized or required by this Agreement to be given or made
by the Company or the Rights Agent to or on the holder of any Rights shall be
sufficiently given or made if delivered or sent by first-class mail, postage
prepaid, addressed to such holder at the address of such holder as it appears
upon the registry books of the Rights Agent or, prior to the Separation Time, on
the registry books of the transfer agent for the Common Stock, as the case may
be. Any notice which is mailed in the manner herein provided shall be deemed
given, whether or not the holder receives the notice.
5.10 Suspension of Exercisability or Exchangeability. To the extent
that the Company determines in good faith that some action will or need be taken
pursuant to Section 3.1(c) or (e) or to comply with federal or state securities
laws, the Company may suspend the exercisability or exchangeability of the
Rights for a reasonable period of up to ninety (90) days following the date of
the occurrence of the Separation Time or the Flip-in Date in order to take such
action or comply with such laws. In the event of any such suspension, the
Company shall issue as promptly as practicable a public announcement stating
that the exercisability or exchangeability of the Rights has been temporarily
suspended. Notice thereof pursuant to Section 5.9 shall not be required.
Failure to give a notice pursuant to the provisions of this Agreement
shall not affect the validity of any action taken hereunder.
5.11 Costs of Enforcement. The Company agrees that if the Company or
any other Person the securities of which are purchasable upon exercise of Rights
fails to fulfill any of its obligations pursuant to this Agreement, then the
Company or such Person will reimburse the holder of any Rights for the costs and
expenses (including legal fees) incurred by such holder in actions to enforce
such holder's rights pursuant to any Rights or this Agreement.
-32-
<PAGE>
5.12 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.
5.13 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
holders of the Rights 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 holders of the Rights.
5.14 Determination and Actions by the Board of Directors, etc. 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. 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 of Directors of
the Company to any liability to the holders of the Rights.
5.15 Descriptive Headings. Descriptive headings appear herein for
convenience only and shall not control or affect the meaning or construction of
any of the provisions hereof.
5.16 GOVERNING LAW. THIS AGREEMENT AND EACH RIGHT ISSUED HEREUNDER
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE COMMONWEALTH OF
PENNSYLVANIA AND FOR ALL PURPOSES SHALL BE GOVERNED BY AND CONSTRUED IN ACCOR-
DANCE WITH THE LAWS OF SUCH STATE APPLICABLE TO CONTRACTS TO BE MADE AND
PERFORMED ENTIRELY WITHIN SUCH STATE.
5.17 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.
-33-
<PAGE>
5.18 Severability. If any term or provision hereof or the application
thereof to any circumstance shall, in any jurisdiction and to any extent, be
invalid or unenforceable, such term or provision shall be ineffective as to
such jurisdiction to the extent of such invalidity or unenforceability without
invalidating or rendering unenforceable the remaining terms and provisions
hereof or the application of such term or provision to circumstances other than
those as to which it is held invalid or unenforceable.
-34-
<PAGE>
EXHIBIT A
[FORM OF RIGHTS CERTIFICATE]
Certificate No. W- ________ Rights
THE RIGHTS ARE SUBJECT TO REDEMPTION OR MANDATORY
EXCHANGE, AT THE OPTION OF THE COMPANY, ON THE TERMS SET
FORTH IN THE RIGHTS AGREEMENT. RIGHTS BENEFICIALLY OWNED
BY ACQUIRING PERSONS OR AFFILIATES OR ASSOCIATES THEREOF
(AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR
TRANSFEREES OF ANY OF THE FOREGOING WILL BE VOID.
Rights Certificate
MELLON BANK CORPORATION
This certifies that ______________________, or registered assigns, is
the registered holder of the number of Rights set forth above, each of which
entitles the registered holder thereof, subject to the terms, provisions and
conditions of the Shareholder Protection Rights Agreement, dated as of October
15, 1996 (as such may be amended from time to time, the "Rights Agreement"),
between Mellon Bank Corporation, a Pennsylvania corporation (the "Company"), and
Mellon Bank, N.A., a national banking association, as Rights Agent (the "Rights
Agent", which term shall include any successor Rights Agent under the Rights
Agreement), to purchase from the Company at any time after the Separation Time
(as such term is defined in the Rights Agreement) and prior to the close of
business on October 31, 2006, one one-hundredth of a fully paid share of
Participating Preferred Stock, par value $1.00 per share (the "Participating
Preferred Stock"), of the Company (subject to adjustment as provided in the
Rights Agreement) at the Exercise Price referred to below, upon presentation and
surrender of this Rights Certificate with the Form of Election to Exercise duly
executed at the designated office of the Rights Agent. The Exercise Price shall
initially be $56.25 per Right (after giving effect to the June 2, 1997 and May
17, 1999 dividends, each of one share of Common Stock for each share of Common
Stock issued) and shall be subject to adjustment in certain events as provided
in the Rights Agreement.
In certain circumstances described in the Rights Agreement, the Rights
evidenced hereby may entitle the registered holder thereof to purchase
securities of an entity other than the Company or securities or assets of the
<PAGE>
Company other than Participating Preferred Stock, all as provided in the Rights
Agreement.
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. Copies of
the Rights Agreement are on file at the principal office of the Company and are
available without cost upon written request.
This Rights Certificate, with or without other Rights Certificates,
upon surrender at the office of the Rights Agent designated for such purpose,
may be exchanged for another Rights Certificate or Rights Certificates of like
tenor evidencing an aggregate number of Rights equal to the aggregate number of
Rights evidenced by the Rights Certificate or Rights Certificates surrendered.
If this Rights Certificate shall be exercised in part, the registered 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 (a) redeemed by the Company under certain
circumstances at its option at a redemption price of $.0025 per Right, or (b)
exchanged by the Company under certain circumstances at its option for one share
of Common Stock or one one-hundredth of a share of Participating Preferred Stock
per Right (or, in certain cases, other securities or assets of the Company),
subject in each case to adjustment in certain events as provided in the Rights
Agreement.
No holder of this Rights Certificate, as such, shall be entitled to
vote or receive dividends or be deemed for any purpose the holder of any
securities which may at any time be issuable on the exercise hereof, nor shall
anything contained in the Rights Agreement or herein be construed to confer upon
the holder hereof, as such, any of the rights of a shareholder of the Company or
any right to vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
shareholders (except as provided in the Rights Agreement), or to receive
-2-
<PAGE>
dividends or subscription rights, or otherwise, until the Rights evidenced by
this Rights Certificate shall have been exercised or exchanged as provided in
the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned as provided in the Rights
Agreement.
WITNESS the facsimile signature of the proper officers of the Company
and its corporate seal.
Date:
------------------------
ATTEST: MELLON BANK CORPORATION
- ----------------------------- By
Secretary ----------------------------
Countersigned:
[NAME OF RIGHTS AGENT
OR RIGHTS REGISTRAR]
By
---------------------------
Authorized Signature
-3-
<PAGE>
[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 Certificates.)
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 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 Guaranteed:
----------------------------------
Signature
(Signature must correspond to
name as written upon the face
of this Rights Certificate in
every particular, without
alteration or enlargement or
any change whatsoever.)
Signatures must be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee Medallion program), pursuant to
SEC Rule 17Ad-15.
<PAGE>
- -------------------------------------------------------------------------------
(To be completed if true)
The undersigned hereby represents, for the benefit of all holders of Rights and
shares of Common Stock, that the Rights evidenced by this Rights Certificate are
not, and, to the knowledge of the undersigned, have never been, Beneficially
Owned by an Acquiring Person or an Affiliate or Associate thereof (as defined in
the Rights Agreement).
-----------------------------------
Signature
- -------------------------------------------------------------------------------
NOTICE
------
In the event the certification set forth above is not completed in
connection with a purported assignment, the Company will deem the Beneficial
Owner of the Rights evidenced by the enclosed Rights Certificate to be an
Acquiring Person or an Affiliate or Associate thereof (as defined in the Rights
Agreement) or a transferee of any of the foregoing and accordingly will deem the
Rights evidenced by such Rights Certificate to be void and not transferable or
exercisable.
<PAGE>
[To be attached to each Rights Certificate]
FORM OF ELECTION TO EXERCISE
(To be executed if holder desires to
exercise the Rights Certificate.)
TO: MELLON BANK CORPORATION
The undersigned hereby irrevocably elects to exercise
_________________ whole Rights represented by the attached Rights Certificate to
purchase the shares of Participating Preferred Stock issuable upon the exercise
of such Rights and requests that certificates for such shares be issued in the
name of:
----------------------------------------
Address:
-------------------------------
----------------------------------------
Social Security or Other Taxpayer
Identification Number:
----------------------------------------
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:
----------------------------------------
Address:
-------------------------------
----------------------------------------
Social Security or Other Taxpayer
Identification Number:
----------------------------------------
Dated:
---------------------------
Signature Guaranteed: -----------------------------------
Signature
(Signature must correspond to name
as written upon the face of this
Rights Certificate in every
particular, without alteration
or enlargement or any change
whatsoever)
<PAGE>
Signatures must be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee Medallion program), pursuant to
SEC Rule 17Ad-15.
- -------------------------------------------------------------------------------
(To be completed if true)
The undersigned hereby represents, for the benefit of all
holders of Rights and shares of Common Stock, that the Rights evidenced by the
enclosed Rights Certificate are not, and, to the knowledge of the undersigned,
have never been, Beneficially Owned by an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement).
-----------------------------------
Signature
- -------------------------------------------------------------------------------
NOTICE
------
In the event the certification set forth above is not completed in
connection with a purported exercise, the Company will deem the Beneficial Owner
of the Rights evidenced by the enclosed Rights Certificate to be an Acquiring
Person or an Affiliate or Associate thereof (as defined in the Rights Agreement)
or a transferee of any of the foregoing and accordingly will deem the Rights
evidenced by such Rights Certificate to be void and not transferable or
exercisable.
<PAGE>
EXHIBIT B
FORM OF RESOLUTION OF BOARD OF DIRECTORS OF
MELLON BANK CORPORATION ESTABLISHING AND DESIGNATING
PARTICIPATING PREFERRED STOCK
STATEMENT AFFECTING CLASS OR
SERIES OF SHARES OF
MELLON BANK CORPORATION
In compliance with the requirements of Section 1522 of the Pennsylvania
Business Corporation Law, the undersigned corporation, desiring to state the
voting rights, designations, preferences, qualifications, privileges,
limitations, conversion rights and other special rights of a series of shares of
its Preferred Stock, hereby certifies that:
1. The name of the Corporation is Mellon Bank Corporation.
2. The resolutions establishing and designating the series of shares of
Preferred Stock and fixing and determining the relative rights and preferences
of such series, as adopted at meetings duly convened and held on October 15,
1996, April 15, 1997, March 17, 1998 and April 19, 1999, set forth in full, are
as follows:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of this Corporation by the Restated Articles of Incorporation, as
amended, there is hereby created and the Corporation be, and it hereby is,
authorized to issue up to 8,000,000 shares of a new series of Preferred Stock
and hereby fixes the designations, powers, preferences and relative,
participating, optional or other special rights, and the qualifications,
limitations or restrictions as follows:
(i) The distinctive serial designation of this series shall be
"Participating Preferred Stock" (hereinafter called "this Series").
Each share of this Series shall be identical in all respects with the
other shares of this Series except as to the dates from and after which
dividends thereon shall be cumulative.
(ii) The number of shares in this Series shall initially be
_______, which number may from time to time be increased or decreased
(but not below the number then outstanding) by the Board of
<PAGE>
Directors. Shares of this Series purchased by the Corporation shall be
cancelled and shall revert to authorized but unissued shares of
Preferred Stock undesignated as to series. Shares of this Series may be
issued in fractional shares, which fractional shares shall entitle the
holder, in proportion to such holder's fractional share, to all rights
of a holder of a whole share of this Series.
(iii) The holders of full or fractional shares of this Series
shall be entitled to receive, when and as declared by the Board of
Directors, but only out of funds legally available therefor, dividends,
(A) on each date that dividends or other distributions (other than
dividends or distributions payable in Common Stock of the Corporation)
are payable on or in respect of Common Stock comprising part of the
Reference Package (as defined below), in an amount per whole share of
this Series equal to the aggregate amount of dividends or other
distributions (other than dividends or distributions payable in Common
Stock of the Corporation) that would be payable on such date to a
holder of the Reference Package and (B) on the last day of March, June,
September and December in each year, in an amount per whole share of
this Series equal to the excess (if any) of $________* over the
aggregate dividends paid per whole share of this Series during the
three month period ending on such last day. Each such dividend shall be
paid to the holders of record of shares of this Series on the date, not
exceeding fifty days preceding such dividend or distribution payment
date, fixed for the purpose by the Board of Directors in advance of
payment of each particular dividend or distribution. Dividends on each
full and each fractional share of this Series shall be cumulative from
the date such full or fractional share is originally issued; provided
that any such full or fractional share originally issued after a
dividend record date and on or prior to the dividend payment date to
which such record date relates shall not be entitled to receive the
dividend payable on such dividend
- --------
* Insert an amount equal to 1/4 of 1% of the Exercise Price divided by the
number of shares purchasable upon exercise of one Right (i.e., a guaranteed
1% dividend).
-2-
<PAGE>
payment date or any amount in respect of the period from such original
issuance to such dividend payment date.
The term "Reference Package" shall initially mean 100 shares of
Common Stock, par value $.50 per share ("Common Stock"), of the
Corporation. In the event the Corporation shall, at any time after the
close of business on _____________,* (A) declare or pay a dividend on
any Common Stock payable in Common Stock, (B) subdivide any Common
Stock or (C) combine any Common Stock into a smaller number of shares,
then and in each such case the Reference Package after such event shall
be the Common Stock that a holder of the Reference Package immediately
prior to such event would hold thereafter as a result thereof.
Holders of shares of this Series shall not be entitled to any
dividends, whether payable in cash, property or stock, in excess of
full cumulative dividends, as herein provided on this Series.
So long as any shares of this Series are outstanding, no dividend
(other than a dividend in Common Stock or in any other stock ranking
junior to this Series as to dividends and upon liquidation) shall be
declared or paid or set aside for payment or other distribution
declared or made upon the Common Stock or upon any other stock ranking
junior to this Series as to dividends or upon liquidation, nor shall
any Common Stock nor any other stock of the Corporation ranking junior
to or on a parity with this Series as to dividends or upon liquidation
be redeemed, purchased or otherwise acquired for any consideration (or
any moneys be paid to or made available for a sinking fund for the
redemption of any shares of any such stock) by the Corporation (except
by conversion into or exchange for stock of the Corporation ranking
junior to this Series as to dividends and upon liquidation), unless, in
each case, the full cumulative dividends (including the dividend to be
due upon payment of such dividend, distribution, redemption, purchase
or other acquisition) on all
- --------
* Insert date of Separation Time
-3-
<PAGE>
outstanding shares of this Series shall have been, or shall
contemporaneously be, paid.
The preferences of each share of this Series with respect to
dividend payments or distributions upon the voluntary or involuntary
liquidation, dissolution or winding up of the Corporation (herein
referred to as "liquidation"), as the case may be, will be in every
respect on a parity with the preferences of every other share of this
Series as to dividend payments or upon liquidation and of every other
share of capital stock of the Corporation which is not specifically
made senior or junior to the shares of this Series as to dividend
payments or upon liquidation. The rights of this Series will be senior
to the Common Stock of the Corporation with respect to dividend
payments and distribution upon liquidation of the Corporation.
(iv) In the event of any merger, consolidation, reclassification
or other transaction in which the shares of Common Stock are exchanged
for or changed into other stock or securities, cash and/or any other
property, then in any such case the shares of this Series shall at the
same time be similarly exchanged or changed in an amount per whole
share equal to the aggregate amount of stock, securities, cash and/or
any other property (payable in kind), as the case may be, that a holder
of the Reference Package would be entitled to receive as a result of
such transaction.
(v) In the event of any liquidation, dissolution or winding up of
the affairs of the Corporation, whether voluntary or involuntary, the
holders of full and fractional shares of this Series shall be entitled,
before any distribution or payment is made on any date to the holders
of the Common Stock or any other stock of the Corporation ranking
Junior to this Series upon liquidation, to be paid in full an amount
per whole share of this Series equal to the greater of (A) $__________*
or (B) the aggregate amount distributed or to be distributed prior to
such date in connection with such liquidation, dissolution
- --------
* Insert an amount equal to 100 times the Exercise Price in effect as of the
Separation Time.
-4-
<PAGE>
or winding up to a holder of the Reference Package (such greater amount
being hereinafter referred to as the "Liquidation Preference"),
together with accrued dividends to such distribution or payment date,
whether or not earned or declared. If such payment shall have been made
in full to all holders of shares of this Series, the holders of shares
of this Series as such shall have no right or claim to any of the
remaining assets of the Corporation.
In the event the assets of the Corporation available for
distribution to the holders of shares of this Series upon any
liquidation, dissolution or winding up of the Corporation, whether
voluntary or involuntary, shall be insufficient to pay in full all
amounts to which such holders are entitled pursuant to the first
paragraph of this Section (v), no such distribution shall be made on
account of any shares of any other class or series of Preferred Stock
ranking on a parity with the shares of this Series upon such
liquidation, dissolution or winding up unless proportionate
distributive amounts shall be paid on account of the shares of this
Series, ratably in proportion to the full distributable amounts for
which holders of all such parity shares are respectively entitled upon
such liquidation, dissolution or winding up.
Upon the liquidation, dissolution or winding up of the
Corporation, the holders of shares of this Series then outstanding
shall be entitled to be paid out of assets of the Corporation
available for distribution to its shareholders all amounts to which
such holders are entitled pursuant to the first paragraph of this
Section (v) before any payment shall be made to the holders of Common
Stock or any other stock of the Corporation ranking junior upon
liquidation to this Series.
For the purposes of this Section (v), the consolidation, or merger
or binding share exchange of the Corporation with any other corpo-
ration or the sale, transfer, division or lease by the Corporation of
all or any part of its property shall not be deemed to constitute a
liquidation, dissolution or winding up of the Corporation.
-5-
<PAGE>
(vi) The shares of this Series shall not be redeemable.
(vii) In addition to any other vote or consent of shareholders
required by law or by the Restated Articles of Incorporation of the
Corporation, each whole share of this Series shall, on any matter, vote
as a class with any other capital stock comprising part of the
Reference Package and voting on such matter and shall have the number
of votes thereon that a holder of the Reference Package would have.
IN WITNESS WHEREOF, MELLON BANK CORPORATION has caused this Statement
Affecting Class or Series of Shares to be signed by its duly authorized officer,
and its corporate seal duly attested by another such officer, to be duly affixed
this day of
----- ---------------.
MELLON BANK CORPORATION
By
-----------------------
Name:
Title:
[Corporate Seal]
Attest:
By
----------------------
Name:
Title:
-6-
