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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
MISSISSIPPI CHEMICAL CORPORATION
(Exact name of registrant as specified in its charter)
Mississippi 64-0292638
(State of incorporation of (IRS Employer
organization) Identification No.)
P.O. Box 388,
Yazoo City, Mississippi 39194
(Address of principal (Zip Code)
executive offices)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange of which
to be so registered each class is to be registered
None Not applicable
Securities to be registered pursuant to Section 12(g) of the Act:
Preferred Share Purchase Rights
(Title of Class)
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Item 1. Description of Registrant's Securities to be
Registered
On August 2, 1994, the Board of Directors of Mississippi
Chemical Corporation, a Mississippi corporation (the "Company"),
declared a dividend of one preferred share purchase right (a
"Right") for each share of Common Stock, $0.01 par value, of the
Company (the "Common Stock"). The dividend is payable on August
15, 1994 to shareholders of record at the close of business on
August 5, 1994 (the "Record Date") and with respect to all shares
of Common Stock that become outstanding after the Record Date and
prior to the earliest of the Separation Date (as defined below),
the redemption of the Rights, the exchange of the Rights and the
expiration of the Rights. Except as set forth below and subject
to adjustment as provided in the Rights Agreement (as defined
below), each Right entitles the registered holder to purchase
from the Company one one-hundredth of a share of the Company's
Preferred Stock, Series A, $0.01 par value per share (the
"Preferred Stock"), at an exercise price of $50.00 per share (the
"Purchase Price"). The description and terms of the Rights are
set forth in a Rights Agreement dated as of August 8, 1994 (the
"Rights Agreement"), between the Company and Harris Trust and
Savings Bank, as Rights Agent (the "Rights Agent").
The Rights will be evidenced by Common Stock certificates
and not separate certificates until the earlier to occur of (i)
10 days following the date of public disclosure that a person or
group, together with persons affiliated or associated with it (an
"Acquiring Person"), has acquired, or obtained the right to
acquire, beneficial ownership of 15% or more of the outstanding
Common Stock (the "Stock Acquisition Date") and (ii) 10 days
following commencement or disclosure of an intention to commence
a tender offer or exchange offer by a person other than the
Company and certain related entities if, upon consummation of the
offer, such person or group, together with persons affiliated or
associated with it, could acquire beneficial ownership of 25% or
more of the outstanding Common Stock (the earlier of such dates
being called "Separation Date"). Until the Separation Date (or
earlier redemption or expiration of the Rights), the transfer of
Common Stock will also constitute transfer of the associated
Rights. Following the Separation Date, separate certificates
will evidence the Rights.
The Rights will first become exercisable on the Separation
Date (unless sooner redeemed). The Rights will expire at the
close of business on August 15, 2004 (the "Expiration Date"),
unless earlier redeemed or exchanged by the Company as described
below.
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The Purchase Price and the number of shares of Preferred
Stock or other securities, cash or other property issuable upon
exercise of the Rights are subject to adjustment from time to
time to prevent dilution (i) in the event of a stock dividend or
distribution on, or a subdivision, combination or
reclassification of, the Preferred Stock, (ii) upon the grant to
holders of the Preferred Stock of certain rights, options,
warrants to subscribe for Preferred Stock or securities
convertible into Preferred Stock at less than the current market
price of the Preferred Stock, or (iii) upon the distribution to
holders of the Preferred Stock of other securities, cash
(excluding regular periodic cash dividends at an annual rate not
in excess of 125% of the annualized rate of cash dividends paid
during the preceding fiscal year), property, evidences of
indebtedness, or assets.
In the event that, following the Separation Date, the
Company is acquired in a merger or other business combination in
which the Common Stock does not remain outstanding or is changed
or 50% or more of its consolidated assets or earning power is
sold, leased, exchanged, mortgaged, pledged or otherwise
transferred or disposed of (in one transaction or a series of
transactions) the Rights will "flip over" and entitle each holder
of a Right to purchase, upon the exercise of the Right at the
then-current Purchase Price, that number of shares of common
stock of the acquiring company (or, in certain circumstances, one
of its affiliates) which at the time of such transaction would
have a market value of two times the Purchase Price.
If (i) a person acquires beneficial ownership of 20% or more
of the Common Stock, (ii) the Company is the surviving
corporation in a merger with an Acquiring Person and the Common
Stock remains outstanding and unchanged, or (iii) an Acquiring
Person engages in a "self-dealing" transaction specified in the
Rights Agreement, the Rights will "flip in" and entitle each
holder of a Right, except as provided below, to purchase, upon
exercise at the then-current Purchase Price, that number of
shares of Common Stock having a market value of two times the
Purchase Price.
Any "flip over" event or "flip in" event is a "Triggering
Event."
Any Rights beneficially owned at any time on or after the
Separation Date by an Acquiring Person or an affiliate or
associate of an Acquiring Person (whether or not such ownership
is subsequently transferred) will become null and void upon the
occurrence of the earlier of the Board of Directors decision to
exchange the rights and a Triggering Event, and any holder of
such Rights will have no right to exercise such Rights.
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Under certain circumstances, the disinterested directors can
approve a transaction with a specific shareholder and freeze the
Rights in connection with that specific transaction.
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price. Holders will
have no right to receive fractional shares of Preferred Stock
(other than fractions which are integral multiples of one one-
hundredth of a share of Preferred Stock) upon the exercise of
Rights. In lieu of such fractional shares, an adjustment in cash
may be made based on the market price of the Preferred Stock on
the last trading date prior to the date of exercise.
The number of outstanding Rights and the number of one one-
hundredths of a share of Preferred Stock issuable upon exercise
of each Right and the Purchase Price are also subject to
adjustment in the event of a stock split of the Common Stock or
distributions, subdivisions, consolidations or combinations of
the Common Stock occurring, in any such case, prior to the
Separation Date.
At any time prior to the earlier of (i) the closing of
business on the tenth day following the time that it becomes
public that an Acquiring Person has become such (with the
possibility for the Board of Directors to extend this time for an
additional 10 days) and (ii) the Expiration Date, the Company may
redeem the Rights in whole, but not in part, at a price of $0.01
per Right. Immediately upon the action of the Company's Board of
Directors electing to redeem the Rights, the right to exercise
the Rights will terminate and the only right of the holders of
Rights thereafter will be to receive the applicable redemption
price.
At any time any person becomes an Acquiring Person and prior
to such time as such person, together with its affiliates becomes
the beneficial owner of at least 50% of the Company's outstanding
Common Stock, the Company may, provided that all necessary
regulatory approvals have been obtained, exchange the Rights
(other than Rights owned by such Acquiring Person which become
null and void), in whole or in part, at a ratio of one share of
Common Stock per Right, subject to adjustment.
Until a Right is exercised, the holder has no rights as a
shareholder of the Company, including, without limitation, the
right to vote or to receive dividends or distributions.
The Company may, without the approval of any holder of the
Rights, but only if at that time the Board of Directors consists
of a majority of disinterested directors, supplement or amend any
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provision of the Rights Agreement, except the redemption window,
the Purchase Price or the redemption price.
Preferred Stock purchasable upon exercise of the Rights will
not be redeemable. Each share of Preferred Stock will be
entitled to a minimum preferential quarterly dividend payment of
$25.00 per share but will be entitled to an aggregate dividend of
100 times the dividend declared per share of Common Stock, if it
is greater. In the event of liquidation, the holders of the
Preferred Stock will be entitled to a minimum preferential
liquidation payment of $100.00 per share, but will be entitled to
an aggregate payment of 100 times the payment made per share of
Common Stock, if it is greater. In the event of any merger or
other business combination in which Common Stock is exchanged,
each share of Preferred Stock will be entitled to receive 100
times the amount received per share of Common Stock. These
rights are protected by customary antidilution provisions.
Because of the nature of the Preferred Stock's dividend,
liquidation and voting rights, the value of the one one-hundredth
of a share of Preferred Stock purchasable upon exercise of each
Right is intended to approximate the value of one share of Common
Stock.
The Rights have certain anti-takeover effects. The Rights
may cause substantial dilution to a person or group that attempts
to acquire the Company on terms not approved by the Company's
Board of Directors, except pursuant to an offer conditioned upon
a substantial number of Rights being acquired. The Rights should
not interfere with any merger or other business combination
approved by the Board of Directors prior to the time a person or
group has acquired beneficial ownership of 15% or more of the
Common Stock, because until such time, the Rights may be redeemed
by the Company at $0.01 per Right.
Pursuant to the Rights Agreement, Rights Certificates will
not be mailed until as soon as practicable after the earlier of
the tenth day after public announcement that a person or group
has acquired beneficial ownership of 15% or more of the Common
Stock or the tenth day after a person commences, or announces an
intention to commence, a tender or exchange offer the
consummation of which could result in a person beneficially
owning 25% or more of the Common Stock.
A copy of the Rights Agreement is attached as Exhibit
1. A copy of the Rights Agreement will be available free of
charge from the Company. This summary description of the Rights
does not purport to be complete and is qualified in its entirety
by reference to the Rights Agreement, which is hereby
incorporated herein by reference.
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Item 2. Exhibits.
1. Rights Agreement dated as of August 8, 1994
between Mississippi Chemical Corporation and
Harris Trust and Savings Bank as Rights Agent,
which includes as Exhibit A the Certificate of
Designation of Preferred Stock, Series A setting
forth the terms of the Preferred Stock; as Exhibit
B forms of Rights Certificate; and as Exhibit C
the form of Summary of Rights.
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SIGNATURE
Pursuant to the requirements of Section 12 of the
Securities Exchange Act of 1934, the registrant has duly caused
this registration statement to be signed on its behalf by the
undersigned, thereto duly authorized.
MISSISSIPPI CHEMICAL CORPORATION
Date: August 8, 1994 By: /s/ Charles O. Dunn
Name: Charles O. Dunn
Title: President and Chief
Executive Officer
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Exhibit 1
_________________________________________________________________
MISSISSIPPI CHEMICAL CORPORATION
and
HARRIS TRUST AND SAVINGS BANK
Rights Agent
_____________________
Rights Agreement
Dated as of August 8, 1994
_________________________________________________________________
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TABLE OF CONTENTS
Section Page
1. Certain Definitions . . . . . . . . . . . . . . . . . . . 1
2. Appointment of Rights Agent . . . . . . . . . . . . . . . 8
3. Issue of Rights Certificates . . . . . . . . . . . . . . 8
4. Form of Rights Certificates . . . . . . . . . . . . . . . 9
5. Countersignature and Registration . . . . . . . . . . . . 10
6. Transfer, Split Up, Combination and Exchange of Rights
Certificates; Mutilated, Destroyed, Lost or Stolen
Rights Certificates . . . . . . . . . . . . . . . . . . 11
7. Exercise of Rights; Purchase Price; Expiration Date of
Rights . . . . . . . . . . . . . . . . . . . . . . . . . 12
8. Cancellation and Destruction of Rights Certificates . . . 15
9. Reservation and Availability of Preferred Stock . . . . . 15
10. Preferred Stock Record Date . . . . . . . . . . . . . . 17
11. The Flip-In . . . . . . . . . . . . . . . . . . . . . . 17
12. The Flip-Over . . . . . . . . . . . . . . . . . . . . . 22
13. Adjustment of Purchase Price, Number and Kind of Shares
or Number of Rights . . . . . . . . . . . . . . . . . . 26
14. Fractional Rights and Fractional Shares . . . . . . . . 33
15. Rights of Action . . . . . . . . . . . . . . . . . . . . 34
16. Agreement of Rights Holders . . . . . . . . . . . . . . 34
17. Rights Holder Not Deemed a Shareholder . . . . . . . . . 35
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18. Concerning the Rights Agent . . . . . . . . . . . . . . 36
19. Merger or Consolidation or Change of Name of Rights
Agent . . . . . . . . . . . . . . . . . . . . . . . . . 36
20. Duties of Rights Agent . . . . . . . . . . . . . . . . . 37
21. Change of Rights Agent . . . . . . . . . . . . . . . . . 40
22. Issuance of New Rights Certificates . . . . . . . . . . 41
23. Redemption and Termination . . . . . . . . . . . . . . . 41
24. Exchange . . . . . . . . . . . . . . . . . . . . . . . . 43
25. Notice of Certain Events . . . . . . . . . . . . . . . . 44
26. Notices . . . . . . . . . . . . . . . . . . . . . . . . 45
27. Supplements and Amendments . . . . . . . . . . . . . . . 46
28. Successors . . . . . . . . . . . . . . . . . . . . . . . 47
29. Benefits of this Agreement . . . . . . . . . . . . . . . 47
30. Severability . . . . . . . . . . . . . . . . . . . . . . 47
31. Governing Law . . . . . . . . . . . . . . . . . . . . . 47
32. Counterparts . . . . . . . . . . . . . . . . . . . . . . 47
33. Descriptive Headings . . . . . . . . . . . . . . . . . . 48
EXHIBITS
EXHIBIT A -- Form of Certificate of Designation, Preferences and
Rights
EXHIBIT B -- Forms of Rights Certificates
EXHIBIT C -- Form of Rights Summary
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RIGHTS AGREEMENT
Rights Agreement, dated as of August 8, 1994 (the
"Agreement"), between MISSISSIPPI CHEMICAL CORPORATION, a
Mississippi corporation (the "COMPANY"), and HARRIS TRUST AND
SAVINGS BANK, (the "RIGHTS AGENT").
W I T N E S S E T H:
WHEREAS, on August 2, 1994, the Board of Directors of
the Company authorized and declared a dividend distribution of
one Right (as hereinafter defined) payable on August 15, 1994 for
each outstanding share of common stock, par value $0.01 per
share, of the Company (the "COMMON STOCK") outstanding on August
5, 1994 (the "Record Date"), and the issuance of one Right for
each share of Common Stock of the Company issued between the
Record Date and the Separation Date (as hereinafter defined) and
one Right for each share of Common Stock of the Company issued
upon exercise of stock options granted prior to the Separation
Date or under any employee plan or arrangement established prior
to the Separation Date, each Right representing the right to
purchase one one-hundredth of a share of Preferred Stock, Series
A, of the Company having the rights, powers and preferences set
forth in the form of Certificate of Designation, Preferences and
Rights attached hereto as Exhibit A, upon the terms and subject
to the conditions hereinafter set forth (the "RIGHTS");
NOW, THEREFORE, in consideration of the premises and
the mutual agreements herein set forth, the parties hereby agree
as follows:
Section 1. Certain Definitions. For purposes of this
Agreement, the following terms have the meanings indicated:
(a) "ACQUIRING PERSON" shall mean any Person (as such
term is hereinafter defined) who or which, together with all
Affiliates (as hereinafter defined) and Associates (as
hereinafter defined) of such Person, shall be the Beneficial
owner (as hereinafter defined) of 15% or more of the shares of
Common Stock then outstanding and shall include all Affiliates
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and Associates of such Person, but shall not include the Company,
any Subsidiary of the Company, any employee benefit plan of the
Company or any Subsidiary of the Company or any entity holding
shares of Common Stock organized, appointed or established by the
Company for or pursuant to the terms of any such plan.
(b) "AFFILIATE" shall mean, with respect to a speci-
fied Person, a Person that directly, or indirectly through one or
more intermediaries, controls or is controlled by, or is under
common control with, the Person specified.
(c) "APPROVED ACQUIRING PERSON" shall mean an
Acquiring Person who becomes such by virtue of the acquisition of
Common Stock directly from the Company, and an Approved Acquiring
Person shall cease to be such if thereafter the Approved
Acquiring Person (i) ceases to be the Beneficial Owner of 15% or
more of the shares of Common Stock then outstanding, or (ii)
takes any affirmative action to increase its proportionate share
of the outstanding Common Stock in one transaction or a series of
transactions by more than 5% of the aggregate number of shares of
Common Stock then outstanding without the prior approval of a
majority of the Continuing Directors; provided that except as
provided in clause (i) hereof, an Approved Acquiring Person shall
not lose its status as such as a result of any actions taken by
the Company which change the number of shares of Common Stock
outstanding.
(d) "ASSOCIATE" shall mean, with respect to a
specified Person, (i) any corporation or organization (other than
the Company or a Subsidiary of the Company) of which such Person
is an officer, director or partner or is, directly or indirectly,
the beneficial owner of 10% or more of any class of equity
security as defined in Rule 3a-11 of the General Rules and
Regulations under the Exchange Act, (ii) any trust or other
estate in which such Person has a substantial beneficial interest
or as to which such Person serves as trustee or in a similar
fiduciary capacity, and (iii) any relative or spouse of such
Person, or any relative of such spouse, who has the same home as
such Person, or is an officer or director of any corporation
controlling or controlled by such Person.
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(e) "BENEFICIAL OWNERSHIP" shall be determined
pursuant to Rule 13d-3 of the General Rules and Regulations under
the Securities Exchange Act of 1934 (or any successor rule or
statutory provision) or, if Rule 13d-3 shall be rescinded and
there shall be no successor rule or statutory provision thereto,
pursuant to Rule 13d-3 as in effect on the date hereof; provided,
however, that a Person shall, in any event, also be deemed to be
the "Beneficial Owner" of any securities:
(i) which such Person or any Affiliate or
Associate thereof beneficially owns, directly or
indirectly;
(ii) which such Person or any Affiliate or
Associate thereof, directly or indirectly, has the
right to acquire (whether such right is exercisable
immediately or only after the passage of time) pursuant
to any agreement, arrangement or understanding (whether
or not in writing) or upon the exercise of conversion
rights, exchange rights, rights, warrants or options,
or otherwise; provided, however, that a Person shall
not be deemed the "Beneficial Owner" of, or to
"beneficially own," (A) securities tendered pursuant to
a tender or exchange offer made by or on behalf of such
Person or any Affiliate or Associate thereof until the
tendered securities are accepted for purchase or
exchange, or (B) securities issuable upon exercise of
the Rights;
(iii) which such Person or any Affiliate or
Associate thereof, directly or indirectly, has sole or
shared voting or investment power with respect thereto
pursuant to any agreement, arrangement or understanding
(whether or not in writing); provided, however, that a
Person shall not be deemed the "Beneficial Owner' of,
or to "beneficially own," any security under this
subparagraph (iii) as a result of an agreement,
arrangement or understanding to vote such security if
the agreement, arrangement or understanding (A) arises
solely from a revocable proxy given in response to a
public proxy or consent solicitation made pursuant to,
and in accordance with, the applicable provisions of
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the General Rules and Regulations under the Exchange
Act, and (B) is not also then reportable by such Person
on Schedule 13D under the Exchange Act; or
(iv) which are beneficially owned, directly or
indirectly, by any other Person or any Affiliate or
Associate thereof with which such Person or any
Affiliate or Associate thereof has any agreement,
arrangement or understanding (whether or not in
writing), for the purpose of acquiring, holding, voting
(except pursuant to a revocable proxy as described in
subparagraph (iii) of this paragraph (e)) or disposing
of any voting securities of the Company.
Nothing in this Section 1(e) shall cause a Person
engaged in business as an underwriter to be the "Beneficial
Owner" of, or to "beneficially own," any securities acquired
through such Person's participation in good faith in a firm
commitment underwriting until the expiration of 40 days after the
date of such acquisition.
(f) "BUSINESS DAY" shall mean any day other than a
Saturday, Sunday or a day on which banking institutions in the
State of Illinois are authorized or obligated by law or executive
order to close.
(g) "CLOSE OF BUSINESS" on any given date shall mean
5:00 P.M., Chicago, Illinois time, on such date; provided,
however, that if such date is not a Business Day it shall mean
5:00 P.M., Chicago, Illinois time, on the next succeeding
Business Day.
(h) "CLOSING PRICE" of any security on any given day
shall be the last sale price, regular way, of such security or,
in case no such sale takes place on such day, the average of the
closing bid and asked prices, regular way, on the principal
trading market on which such security is then traded.
(i) "COMMON STOCK" shall mean the common stock, par
value $0.01 per share, of the Company, and "common stock" when
used with reference to any Person other than the Company shall
mean the capital stock with the greatest voting power, or the
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equity securities or other equity interest having power to
control or direct the management, of such Person.
(j) "CONTINUING DIRECTOR" shall mean any director of
the Company who is not an Acquiring Person or a representative or
nominee of an Acquiring Person, and (i) who was elected by the
stockholders or appointed by the Board of Directors of the
Company prior to the date as of which the Acquiring Person became
an Acquiring Person, or (ii) who was designated (before his
initial election or appointment as a director) as a Continuing
Director by a majority of the Continuing Directors.
(k) "CURRENT MARKET PRICE" of any security on any
given day shall be deemed to be the average of the daily Closing
Prices per share or other trading unit of such security for 10
consecutive Trading Days (as hereinafter defined) immediately
preceding such date; provided, however, that with respect to
shares of capital stock, in the event that the current market
price per share of the capital stock is determined during a
period following the announcement of (i) a dividend or
distribution on the capital stock payable in shares of such
capital stock or securities convertible into shares of such
capital stock (other than the Rights), or (ii) any subdivision,
combination or reclassification of the capital stock, and prior
to the expiration of the requisite 10 Trading Day period, as set
forth above, after the ex-dividend date for such dividend or
distribution, or the record date for such subdivision, com-
bination or reclassification, then and in each such case, the
Current Market Price, shall be properly adjusted to take into
account ex-dividend trading; and provided further that if the
security is not publicly held or not so listed or traded, Current
Market Price per share or other trading unit shall mean the fair
value per share or other trading unit as determined in good faith
by the Board of Directors of the Company, whose determination
shall be described in a statement filed with the Rights Agent and
shall be conclusive for all purposes.
(l) "EQUIVALENT PREFERRED STOCK" shall mean any class
or series of capital stock of the Company, other than the
Preferred Stock, which is entitled to participate on a
proportional basis with the Preferred Stock in dividends and
other distributions, including distributions upon the
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liquidation, dissolution or winding up of the Company. In
calculating the number of shares any class or series of
Equivalent Preferred Stock for purposes of Section 13 of this
Agreement, the number of shares or fractions of Equivalent
Preferred Stock that are entitled to the same dividend or
distribution as a whole share of Preferred Stock shall be deemed
to be one share.
(m) "EXCHANGE ACT" shall mean the Securities Exchange
Act of 1934, as amended and in effect on the date of this
Agreement, and all references to any rule or regulation of the
General Rules and Regulations under the Exchange Act shall be,
except as otherwise specifically provided herein, to such rule or
regulation as was in effect on the date of this Agreement.
(n) "EXCHANGE DATE" shall mean the date at which the
rights are exchanged as provided in Section 24 of this Agreement.
(o) "EXPIRATION DATE" shall mean the Close of Business
on August 15, 2004 subject to extension as provided in Section
12(c) of this Agreement.
(p) "FLIP-IN EVENT" shall mean any of the events
described in Section 11(a) of this Agreement.
(q) "FLIP-OVER EVENT" shall mean any of the events
described in Section 12(a) of this Agreement.
(r) "PERSON" shall mean any individual, firm,
corporation, partnership or other entity and shall include any
"group" as that term is used in Rule 13d-5(b) under the Exchange
Act.
(s) "PURCHASE PRICE" shall mean with respect to each
Right, the price set forth in Section 7(b) of this Agreement.
(t) "PREFERRED STOCK" shall mean shares of Preferred
Stock, Series A par value $0.01 per share, of the Company.
(u) "REDEMPTION DATE" shall mean the time at which the
Rights are ordered to be redeemed pursuant to Section 23 of this
Agreement.
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(v) "SEPARATION DATE" shall mean the earlier of (i)
the tenth day after the Stock Acquisition Date (as hereinafter
defined) or (ii) the tenth day after the date of the commencement
of, or first public announcement of the intent to commence, a
tender or exchange offer by any Person (other than the Company,
any Subsidiary of the Company, any employee benefit plan of the
Company or any Subsidiary of the Company or any entity holding
shares of Common Stock organized, appointed or established by the
Company for or pursuant to the terms of any such plan), if upon
consummation thereof, such Person would be the Beneficial Owner
of 25% or more of the shares of Common Stock then outstanding
(including any such date which is after the date of this
Agreement and prior to the issuance of the Rights).
(w) "STOCK ACQUISITION DATE" shall mean the first date
of public announcement by the Company, an Acquiring Person or
otherwise, that an Acquiring Person, other than an Approved
Acquiring Person, has become such.
(x) "SUBSIDIARY" shall mean, with reference to any
Person, any corporation of which a majority of any class of
equity security is Beneficially Owned, directly or indirectly, by
such Person.
(y) "TRADING DAY," with respect to any security shall
mean a day on which the principal national securities exchange on
which the security is listed or admitted to trading is open for
the transaction of business or, if the security is not listed or
admitted to trading on any national securities exchange, a
Business Day.
(z) "TRIGGERING EVENT" shall mean a Flip-In Event or a
Flip-Over Event.
(aa) "WHOLE BOARD" shall mean the total number of
directors which the Company would have if there were no
vacancies.
Any determination required by the definitions contained
in this Section 1 shall be made by the Board of Directors of the
Company in its good faith judgment, which determination shall be
final and binding on the Rights Agent.
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Section 2. Appointment of Rights Agent. The Company
hereby appoints the Rights Agent to act as agent for the Company
and the holders of the Rights (who, in accordance with Section 3
of this Agreement, shall prior to the Separation Date also be the
holders of the Common Stock) in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such
appointment. The Company may from time to time appoint such
co-Rights Agents as it may deem necessary or desirable.
Section 3. Issue of Rights Certificates.
(a) Until the Separation Date, (i) the Rights will be
evidenced by the certificates for the Common Stock registered in
the names of the holders of the Common Stock (which certificates
for Common Stock shall be deemed also to be certificates for
Rights) and not by separate certificates, and (ii) the Rights
will be transferable only in connection with the transfer of the
underlying shares of Common Stock (including a transfer to the
Company).
(b) As soon as practicable after the Separation Date,
the Rights Agent will send by first-class, insured, postage
prepaid mail, to each record holder of the Common Stock as of the
Close of Business on the Separation Date, at the address of such
holder shown on the records of the Company, a Rights certificate
(the "RIGHTS CERTIFICATE"), evidencing one Right (as adjusted
from time to time prior to the Separation Date pursuant to this
Agreement) for each share of Common Stock so held. As of and
after the Separation Date, the Rights will be evidenced solely by
Rights Certificates.
(c) As soon as practicable after the Record Date, the
Company will send a copy of a Summary of Rights, in substantially
the form attached hereto as Exhibit C (the "SUMMARY OF RIGHTS"),
by first-class, postage prepaid mail to each record holder of the
Common Stock as of the Close of Business on the Record Date, at
the address of such holder shown on the records of the Company.
(d) Certificates for the Common Stock issued after the
Record Date but prior the earlier of the Separation Date or the
Expiration Date (as hereinafter defined), shall be deemed also to
be certificates for Rights, and shall bear the following legend:
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This certificate also evidences and entitles the
holder hereof to certain Rights as set forth in the
Rights Agreement between Mississippi Chemical Corpora-
tion (the "Company") and Harris Trust and Savings Bank,
dated as of August 8, 1994 (the "Rights Agreement"),
the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the
principal offices of the Company. Under certain
circumstances, as set forth in the Rights Agreement,
such Rights will be evidenced by separate certificates
and will no longer be evidenced by this certificate.
The Company will mail to the holder of this certificate
a copy of the Rights Agreement without charge after
receipt of a written request therefor. Under certain
circumstances, Rights beneficially owned by Acquiring
Persons (as defined in the Rights Agreement) become
null and void and the holder of such Rights (including
any subsequent holder) shall not have any right to
exercise the Rights.
(e) After the Separation Date but prior to the
Expiration Date, Rights shall be issued in connection with the
issuance of Common Stock upon the exercise of stock options
granted prior to the Separation Date or pursuant to other
benefits under any employee plan or arrangement established prior
to the Separation Date; provided, however, that if, pursuant to
the terms of any option or other benefit plan, the number of
shares issuable thereunder is adjusted after the Separation Date,
the number of Rights issuable upon issuance of the shares shall
be equal only to the number of shares which would have been
issuable prior to the adjustment.
Section 4. Form of Rights Certificates.
(a) The Rights Certificates (and the form of election
to purchase shares and form of assignment) shall be in
substantially the form attached hereto as Exhibit B and may have
such marks of identification or designation and such legends,
summaries or endorsements printed thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of
this Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant
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thereto or with any rule or regulation of any stock exchange on
which the Rights may from time to time be listed or to conform to
usage. Subject to the provisions of this Agreement, the Rights
Certificates, whenever issued, shall be dated as of the Record
Date and on their face shall entitle the holders thereof to
purchase such number of shares of Preferred Stock which shall be
set forth therein at the Purchase Price set forth therein,
subject to adjustment as provided in this Agreement.
(b) Any Rights Certificate issued pursuant to Section
3(a) of this Agreement that represents Rights beneficially owned
by an Acquiring Person or that represents any Rights owned on or
after the Separation Date by any Person who subsequently becomes
an Acquiring Person and any Rights Certificate issued at any time
upon the transfer of any Rights to an Acquiring Person or to any
nominee of such Acquiring Person and any Rights Certificate
issued pursuant to Section 6 or Section 13 of this Agreement upon
transfer, exchange, replacement or adjustment of any other Rights
Certificate referred to in this sentence, may contain the
following legend:
The Rights represented by this Rights Certificate
were issued to a Person who was or became an Acquiring
Person. This Rights Certificate and the Rights
represented hereby may become void in the circumstances
specified in Section 7(e) of the Rights Agreement.
Section 5. Countersignature and Registration.
(a) The Rights Certificates shall be executed on
behalf of the Company by the Chairman of its Board of Directors,
its President or any Vice President, either manually or by
facsimile signature and shall have affixed thereto the Company's
seal or a facsimile thereof which shall be attested by the
Secretary or an Assistant Secretary of the Company, either
manually or by facsimile signature. Each Rights Certificate
shall be manually countersigned by the Rights Agent and shall not
be valid for any purpose unless so countersigned. In case any
officer of the Company who shall have signed any of the Rights
Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by
the Company, such Rights Certificates, nevertheless, may be
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countersigned by the Rights Agent, and issued and delivered by
the Company with the same force and effect as though the person
who signed such Rights Certificates had not ceased to be such
officer of the Company; and any Rights Certificate may be signed
on behalf of the Company by any person who, at the actual date of
the execution of such Rights Certificate, shall be a proper
officer of the Company to sign such Rights Certificate, although
at the date of the execution of this Rights Agreement any such
person was not such an officer.
(b) Following the Separation Date, the Rights Agent
will keep or cause to be kept, at one of its offices, books for
registration and transfer of the Rights Certificates issued
hereunder. Such books shall show the names and addresses of the
respective holders of the Rights Certificates, the number of
Rights evidenced by each of the Rights Certificates, and the
certificate number and the date of each of the Rights
Certificates.
Section 6. Transfer, Split Up, Combination and
Exchange of Rights Certificates; Mutilated, Destroyed, Lost or
Stolen Rights Certificates.
(a) Subject to the provisions of Section 14 of this
Agreement, at any time after the Close of Business on the
Separation Date, and at or prior to the Close of Business on the
Expiration Date, any Rights Certificate or Certificates may be
transferred, split up, combined or exchanged for another Rights
Certificate or Certificates, entitling the registered holder to
purchase a like number of shares of Preferred Stock (or other
securities, cash or other property, as the case may be) as the
Rights Certificate or Certificates surrendered then entitled such
holder (or former holder in the case of a transfer) to purchase.
Any registered holder desiring to transfer, split up, combine or
exchange any Rights Certificate or Certificates shall make such
request in writing delivered to the Rights Agent, and shall
surrender the Rights Certificate or Certificates to be
transferred, split up, combined or exchanged at the principal
office of the Rights Agent designated for such purpose.
Thereupon, the Rights Agent shall countersign and deliver to the
Person entitled thereto a Rights Certificate or Rights
Certificates, as the case may be, as so requested. The Company
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may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Rights
Certificates.
(b) Upon receipt by the Company and the Rights Agent
of evidence reasonably satisfactory to them of the loss, theft,
destruction or mutilation of a Rights Certificate, and, in case
of loss, theft or destruction, of indemnity or security reason-
ably satisfactory to them, and reimbursement to the Company and
the Rights Agent of all reasonable expenses incidental thereto,
and upon surrender to the Rights Agent and cancellation of the
Rights Certificate if mutilated, the Company will execute and
deliver a new Rights Certificate of like tenor to the Rights
Agent for countersignature and delivery to the registered owner
in lieu of the Rights Certificate so lost, stolen, destroyed or
mutilated.
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights.
(a) Each Right shall entitle (except as otherwise
provided in this Agreement) the registered holder thereof, upon
the exercise thereof as provided in this Agreement, to purchase,
for the Purchase Price, at any time after the Separation Date and
prior to the earliest of the Expiration Date, the Exchange Date
and the Redemption Date, one one-hundredth share of Preferred
Stock, subject to adjustment from time to time as provided in
Section 13 of this Agreement, payable in lawful money of the
United States of America in accordance with Paragraph (c) below.
(b) Subject to Section 7(e), Section 23(a) and Section
24 of this Agreement, the registered holder of any Rights
Certificate may exercise the Rights evidenced thereby in whole or
in part at any time after the Separation Date upon surrender of
the Rights Certificate, with the form of election to purchase on
the reverse side thereof including the certificate contained
therein duly executed, to the Rights Agent at the principal
office of the Rights Agent, together with payment of the Purchase
Price for each one one-hundredth share of Preferred Stock as to
which the Rights are exercised prior to the earliest of the
Expiration Date, the Exchange Date and the Redemption Date.
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(c) Upon receipt of a Rights Certificate representing
exercisable Rights, with the form of election to purchase
including the certificate contained therein duly executed,
accompanied by payment of the Purchase Price for the shares (or
cash or other assets as the case may be) to be purchased and an
amount equal to any applicable transfer tax in cash, or by
certified check or bank draft payable to the order of the
Company, the Rights Agent shall thereupon promptly:
(i)(A) requisition from any transfer agent for the
Preferred Stock certificates for the number of one one-
hundredths of a share of Preferred Stock to be purchased and
the Company hereby irrevocably authorizes its transfer agent
to comply with all such requests, or (B) requisition from
the depositary agent depositary receipts representing such
number of one one-hundredths of a share of Preferred Stock
as are to be purchased (in which case certificates for the
shares of Preferred Stock represented by such receipts shall
be deposited by the transfer agent with the depositary
agent) and the Company will direct the depositary agent to
comply with such request;
(ii) requisition from the Company the amount of cash,
if any, to be paid in lieu of fractional shares in
accordance with Section 14 of this Agreement;
(iii) after receipt of such certificates or depositary
receipts, cause the same to be delivered to or upon the
order of the registered holder of such Rights Certificate,
registered in such name or names as may be designated by
such holder; and
(iv) after receipt, deliver such cash, if any, to
or upon the order of the registered holder of such
Rights Certificate.
In the event that the Company is obligated to issue other
securities (including shares of Common Stock) of the Company, pay
cash and/or distribute other property pursuant to this Agreement,
the Company will make all arrangements necessary so that such
other securities, cash and/or other property are available for
distribution by the Rights Agent, if and when appropriate.
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<PAGE>
(d) In case the registered holder of any Rights
Certificate shall exercise less than all the Rights evidenced
thereby, a new Rights Certificate evidencing Rights equivalent to
the Rights remaining unexercised shall be issued by the Rights
Agent and delivered to the registered holder of such Rights
Certificate or to his duly authorized assigns, subject to the
provisions of Section 6 and Section 14 of this Agreement.
(e) Notwithstanding anything in this Agreement to the
contrary, upon the occurrence of the earlier of (x) the date on
which the Board of Directors of the Company decides to exchange
the Rights pursuant to Section 24 of this Agreement and (y) a
Triggering Event, any unexercised Rights that are or were, at any
time on or after the earlier to occur of (i) the Separation Date
and (ii) the Stock Acquisition Date, beneficially owned by an
Acquiring Person (other than an Approved Acquiring Person who is
not a party to the Triggering Event) or owned by any Person who
subsequently becomes an Acquiring Person (other than an Approved
Acquiring Person who is not a party to the Triggering Event)
shall immediately become permanently null and void without any
further action, and no holder of such Rights shall have any right
whatsoever with respect to such Rights under this Agreement or
otherwise. The Company shall use all reasonable efforts to
ensure that the provisions of this Section 7(e) and Section 4(b)
of this Agreement are complied with, but shall have no liability
to any holder of Rights Certificates or to any other Person as a
result of its failure to make any determinations with respect to
an Acquiring Person or its Affiliates, Associates or transferees
hereunder.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be
obligated to undertake any action with respect to a registered
holder of any Rights Certificate upon the occurrence of any
purported exercise thereof unless such registered holder shall
have (i) completed and signed the certificate contained in the
form of election to purchase set forth on the reverse side of the
Rights Certificate surrendered for such exercise and (ii)
provided such additional evidence of the identity of the
Beneficial Owner (or former or proposed Beneficial Owner) or
Affiliates thereof as the Company shall reasonably request.
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<PAGE>
Section 8. Cancellation and Destruction of Rights
Certificates. All Rights Certificates surrendered for the
purpose of exercise, transfer, split-up, combination or exchange
shall, if surrendered to the Company or any of its agents, be
delivered to the Rights Agent for cancellation or in cancelled
form, or, if surrendered to the Rights Agent, shall be cancelled
by it, and no Rights Certificates shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this
Agreement. The Company shall deliver to the Rights Agent for
cancellation and retirement, and the Rights Agent shall so cancel
and retire, any other Rights Certificates purchased or acquired
by the Company otherwise than upon the exercise thereof. The
Rights Agent shall deliver all cancelled Rights Certificates to
the Company, or shall, at the written request of the Company,
destroy such cancelled Rights Certificates, and in such case
shall deliver a certificate of destruction thereof to the
Company.
Section 9. Reservation and Availability of Preferred
Stock.
(a) The Company covenants and agrees that it will cause
to be reserved and kept available at all times out of its
authorized and unissued shares of Preferred Stock or its
authorized and issued shares of Preferred Stock held in its
treasury, free from preemptive rights or any right of first
refusal, the number of shares of Preferred Stock that will be
sufficient to permit the exercise in full of all Rights from time
to time outstanding.
(b) So long as the shares of Preferred Stock issuable
upon the exercise of the Rights may be listed on any national
securities exchange, the Company shall use its best efforts to
cause, from and after the time the Rights become exercisable, all
shares reserved for such issuance to be listed on such exchange
upon official notice of issuance upon such exercise.
(c) The Company shall use its best efforts to:
(i) file, as soon as practicable following the earlier
of the Separation Date or as soon as is required by law, a
registration statement under the Securities Act of 1933 (the
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<PAGE>
"Act"), with respect to the Preferred Stock purchasable upon
exercise of the Rights on an appropriate form;
(ii) cause such registration statement to become
effective as soon as practicable after the filing; and
(iii) cause such registration statement to remain
effective (with a prospectus at all times meeting the
requirements of the Act) until the earliest of (A) the date
as of which Rights are no longer exercisable for such
securities, (B) the Expiration Date and (C) the Redemption
Date.
The Company will also take all action necessary to ensure
compliance with the securities or "blue sky" laws of the various
states in connection with the exercisability of the Rights. The
Company may temporarily suspend, for a period of time not to
exceed ninety (90) days after the date set forth in clause (i) of
the first sentence of this Section 9(c), the exercisability of
the Rights in order to prepare and file such registration
statements and permit them to become effective. Upon any such
suspension, the Company shall issue a public announcement stating
that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the
suspension is no longer in effect. Notwithstanding any provision
of this Agreement to the contrary, the Rights shall not be
exercisable in any jurisdiction unless the requisite
qualification in that jurisdiction shall have been obtained and,
if applicable, until a registration statement has been declared
effective.
(d) The Company covenants and agrees that it will take
all such action as may be necessary to ensure that all shares of
Preferred Stock delivered upon exercise of Rights shall, at the
time of delivery of the certificates for such shares (subject to
payment of the Purchase Price), be duly and validly authorized
and issued and fully paid and nonassessable.
(e) The Company further covenants and agrees that it
will pay when due and payable any and all federal and state
transfer taxes and charges which may be payable in respect of the
issuance or delivery of the Rights Certificates and of any shares
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of Preferred Stock upon the exercise of Rights. The Company
shall not, however, be required to pay any transfer tax which may
be payable in respect of any transfer or delivery of Rights
Certificates to a Person other than, the issuance or delivery of
the shares of Preferred Stock, in respect of a name other than
that of, the registered holder of the Rights Certificates
evidencing Rights surrendered for exercise or the issuance or
delivery of any certificates for shares of Preferred Stock in a
name other than that of, the registered holder, upon the exercise
of any Rights, until such tax shall have been paid (any such tax
being payable by the holder of such Rights Certificate at the
time of surrender) or until it has been established to the
Company's satisfaction that no such tax is due.
Section 10. Preferred Stock Record Date. Each Person
in whose name any certificate for shares of Preferred Stock is
issued upon the exercise of Rights shall for all purposes be
deemed to have become the holder of record of the shares of
Preferred Stock represented thereby on, and such certificate
shall be dated, the date upon which the Rights Certificate
evidencing such Rights was duly surrendered and payment of the
Purchase Price (and all applicable transfer taxes) was made;
provided, however, that if the date of such surrender and payment
is a date upon which the Preferred Stock transfer books of the
Company are closed, such Person shall be deemed to have become
the record holder of such shares on, and such certificate shall
be dated, the next succeeding Business Day on which the Preferred
Stock transfer books of the Company are open.
Section 11. The Flip-In. (a) In the event:
(i) any Acquiring Person, directly or indirectly,
shall merge into the Company or otherwise combine with
the Company and the Company shall be the continuing or
surviving corporation of such merger or combination and
the Common Stock of the Company shall remain
outstanding and unchanged, except pursuant to a merger
or other combination involving an Approved Acquiring
Person which was approved by a majority of the
Continuing Directors; or
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(ii) any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of
the Company or of any Subsidiary of the Company, or any
entity organized, appointed or established pursuant to
the terms of such plan) shall become the Beneficial
Owner of 20% or more of the shares of Common Stock then
outstanding (except pursuant to an offer for all
outstanding shares of Common Stock at a price and upon
such terms and conditions as a majority of the
Continuing Directors determine to be in the best
interests of the Company and its stockholders, other
than such Acquiring Person); or
(iii) any Acquiring Person shall, in one or a series
of related transactions, directly or indirectly, transfer
any assets to the Company or any of its Subsidiaries in
exchange (in whole or in part) for shares of Common Stock or
for securities exercisable or exchangeable for, or
convertible into, shares of Common Stock or otherwise obtain
from the Company or any of its Subsidiaries, with or without
consideration, any additional Common Stock or other
securities of the Company or securities of any of its
subsidiaries or securities exercisable or exchangeable for,
or convertible into, shares of Common Stock or other
securities of the Company or securities of any of its
Subsidiaries (other than an issuance upon conversion of
convertible securities of the Company or any such Subsidiary
that were not acquired from the Company or any such
Subsidiary) except pursuant to a transaction or series of
transactions approved by a majority of the Continuing
Directors at a time when there are no Acquiring Persons
other than Approved Acquiring Persons; or
(iv) any Acquiring Person shall sell, purchase,
lease, exchange, mortgage, pledge, otherwise transfer
or dispose or acquire, from, to, with or of, the
Company or any of its Subsidiaries, assets (including
securities) on terms and conditions less favorable to
the Company or such Subsidiary than the Company or such
Subsidiary would be able to obtain in an arm's-length
transaction with an unrelated third party, unless those
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transactions are approved by a majority of the
Continuing Directors; or
(v) during the time when there is an Acquiring
Person, there shall be any reclassification of
securities (including any reverse stock split), or
recapitalization of the Company, or any merger or
consolidation of the Company with any of its
Subsidiaries or any other transaction or series of
transactions involving the Company (whether or not with
or into or otherwise involving an Acquiring Person)
which has the effect, directly or indirectly, of
increasing by more than 1% the proportionate share of
the outstanding shares of any class of equity
securities of the Company or any of its Subsidiaries
which is directly or indirectly owned by any Acquiring
Person, except pursuant to a transaction or series of
transactions approved by a majority of the Continuing
Directors at a time when there are no Acquiring Persons
other than Approved Acquiring Persons; or
(vi) any Acquiring Person shall, directly or
indirectly, sell, purchase, lease, exchange, mortgage,
pledge, otherwise transfer or acquire or dispose, in
one transaction or a series of related transactions,
from, to, with or of, the Company or any of its
Subsidiaries, assets having an aggregate fair market
value (as determined in good faith by a majority of the
Continuing Directors) in excess of 10% or more of the
total assets of the Company as shown on its
consolidated balance sheet as of the end of the most
recent fiscal quarter ending prior to the time the
determination is being made to the stockholders of the
Company, unless such sale or lease has been approved by
a majority of the Continuing Directors; or
(vii) during the time when there is an Acquiring
Person, there shall be any distribution of assets or
securities of the Company or of any of its
Subsidiaries, in one transaction or a series of
transactions, having an aggregate fair market value (as
determined in good faith by a majority of the
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Continuing Directors) in excess of 10% or more of the
total assets of the Company as shown on its
consolidated balance sheet as of the end of the most
recent fiscal quarter ending prior to the time the
determination is being made to the stockholders of the
Company, unless the distribution is approved by a
majority of the Continuing Directors; or
(viii) any Acquiring Person, directly or
indirectly, shall receive management fees or other
compensation from the Company or any of its
Subsidiaries other than compensation for full-time
employment as a regular employee or directors' fees on
the same basis as the other directors of the Company or
any of its Subsidiaries, or receive the benefit of
guarantees or other financial assistance or tax credits
or other tax advantages from the Company or any of its
Subsidiaries, unless those transactions are approved by
a majority of the Continuing Directors; or
(ix) during the time when there is an Acquiring
Person, (1) there shall be any reduction in the annual rate
of dividends paid on the Common Stock (except as necessary
or appropriate, in the opinion of a majority of the
Continuing Directors, for valid business reasons, to reflect
any subdivision of the Common Stock or as required under the
laws of the jurisdiction of incorporation of the Company) or
(2) there shall be a failure to increase the annual rate of
dividends as necessary to reflect any reclassification
(including any reverse stock split), recapitalization,
combination, reorganization or any similar transaction which
has the effect of reducing the number of shares of
outstanding Common Stock (except as necessary or
appropriate, in the opinion of a majority of the Continuing
Directors, for valid business reasons or to the extent such
increase in the rate of dividends would be prohibited under
the laws of the jurisdiction of incorporation of the
Company);
then, and in each case, subject to the provisions of Section 24
of this Agreement, each holder of a Right, except as provided
below and in Section 7(e) of this Agreement, shall thereafter
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have a right to receive, upon exercise of the Right at the then
current Purchase Price, in accordance with the terms of this
Agreement, in lieu of shares of Preferred Stock, such number of
shares of Common Stock of the Company as shall equal the result
obtained by (x) multiplying the then current Purchase Price by
the then number of one one-hundredths of a share of Preferred
Stock for which a Right is then exercisable and dividing that
product by (y) 50% of the Current Market Price per share of the
Common Stock on the date on which the first of the events listed
above in this subparagraph (a) occurs (such number of shares
being herein referred to as the "ADJUSTMENT SHARES").
(b) In the event that there shall not be sufficient
treasury shares or authorized but unissued shares of Common Stock
to permit the exercise in full of the Rights in accordance with
the foregoing subparagraph (a), the Company shall take all such
action as may be necessary to authorize additional shares of
Common Stock for issuance upon exercise of the Rights; provided,
however, that if the Company is unable to cause the authorization
of a sufficient number of additional shares of Common Stock,
then, in the event the Rights become so exercisable, the Company,
with respect to each Right and to the extent necessary and
permitted by applicable law and any agreements or instruments in
effect on the date hereof to which the Company is a party, shall,
upon the exercise of such Rights,
(i) pay an amount in cash equal to the excess of
(A) the product of (1) the number of Adjustment Shares,
multiplied by (2) the Current Market Price of the Common
Stock (such product being herein referred to as the "CURRENT
VALUE"), over (B) the Purchase Price, in lieu of issuing
shares of Common Stock and requiring payment therefor, or
(ii) issue debt or equity securities, or a
combination thereof, having a value equal to the Current
Value, where the value of such securities shall be
determined by a nationally recognized investment banking
firm selected by the Board of Directors of the Company, and
require the payment of the Purchase Price, or
(iii) deliver any combination of cash, property,
Common Stock and/or other securities having the requisite
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value, and require payment of all or any requisite portion
of the Purchase Price.
To the extent that the Company determines that some
action need be taken pursuant to clauses (i), (ii), or (iii) of
the proviso of this Section 11(b), a majority of the Continuing
Directors may suspend the exercisability of the Rights for a
period of up to 45 days following the date on which the first of
the events listed in Section 11(a)(i), (ii) or (iii) of this
Agreement shall have occurred, in order to decide the appropriate
form of distribution to be made pursuant to the above proviso and
to determine the value thereof. In the event of any suspension,
the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as
well as a public announcement at the time the suspension is no
longer in effect.
Section 12. The Flip-Over
(a) In the event that, following the Separation Date,
directly or indirectly:
(w) the Company shall consolidate with, or merge with
and into, any other Person; or
(x) any Person shall consolidate with the Company, or
merge with and into the Company and the Company shall be the
continuing or surviving corporation of such merger and, in
connection with such merger, all or part of the shares of
Common Stock shall be changed into or exchanged for stock or
other securities of any other Person or cash or any other
property; or
(y) the Company shall effect a share exchange in which
all or part of the Common Stock of the Company shall be
changed into (including, without limitation, any conversion
into or exchange for) securities of any other Person, cash
or any other property; or
(z) the Company shall sell, lease, exchange, mortgage,
pledge or otherwise transfer (or one or more of its
Subsidiaries shall sell, lease, exchange, mortgage, pledge
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or otherwise transfer), in one or more transactions, assets
or earning power aggregating more than 50% of the assets or
earning power of the Company and its Subsidiaries (taken as
a whole) to any other Person or Persons
then, and in each such case, subject to the provisions of Section
24 of this Agreement, except where the Person involved in the
transaction is an Approved Acquiring Person and the transaction
was approved by a majority of the Continuing Directors,
(i) each holder of a Right, except as provided in
Section 7(e) of this Agreement, shall thereafter have
the right to receive, upon the exercise thereof at the
then current Purchase Price in accordance with the
terms of this Agreement, such number of shares of
freely tradeable common stock of the Principal Party,
free and clear of any lien, encumbrance or other
adverse claim, as shall be equal to the result obtained
by (1) multiplying the then current Purchase Price by
the number of one one-hundredths of a share of
Preferred Stock for which a Right is then exercisable
(or the number of one one-hundredths of a share of
Preferred Stock for which a Right was exercisable
immediately prior to the occurrence of the Flip-In
Event if a Flip-In Event has previously occurred) and
dividing that product by (2) 50% of the Current Market
Price per share of the common stock of such Principal
Party on the date of consummation of the Flip-Over
Event;
(ii) all common stock of any Person for which any
Right may be exercised after consummation of a Business
Combination as provided in this Section 12(a) shall, when
issued upon exercise thereof in accordance with this
Agreement, be duly and validly authorized and issued and
fully paid and nonassessable;
(iii) such Principal Party shall thereafter be
liable for, and shall assume, by virtue of the
Flip-Over Event, all the obligations and duties of the
Company pursuant to this Agreement;
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(iv) the term "Company" shall thereafter be
deemed to refer to such Principal Party, it being
specifically intended that the provisions of Section 13
hereof shall apply to such Principal Party;
(v) such Principal Party shall take such steps
(including, but not limited to, the reservation of a
sufficient number of shares of its common stock) in
connection with such consummation as may be necessary
to assure that the provisions hereof shall thereafter
be applicable, as nearly as reasonably may be, in
relation to its shares of common stock thereafter
deliverable upon the exercise of the Rights; and
(vi) the provisions of Section 11 of this
Agreement shall be of no effect following the first
occurrence of any Flip-Over Event.
(b) "PRINCIPAL PARTY" shall mean:
(i) in the case of any transaction described in
(w), (x) or (y) of the first sentence of this Section
12, the Person that is the issuer of any securities
into which shares of Common Stock of the Company are
converted or exchanged in such merger or consolidation,
and if no securities are so issued, the Person that is
the other party to the merger or consolidation; and
(ii) in the case of any transaction described in
(z) of the first sentence in this Section 12, the
Person that is the party receiving the greatest portion
of the assets or earning power transferred pursuant to
such transaction or transactions;
provided, however, that in any such case, (1) if the common stock
of such Person is not at such time and has not been continuously
over the preceding 12-month period registered under the
Securities Exchange Act of 1934, as then in effect, and such
Person is a direct or indirect Subsidiary of another Person the
common stock of which is and has been so registered, "Principal
Party" shall refer to such other Person; and (2) in case such
Person is a Subsidiary, directly or indirectly, of more than one
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Person, the common stocks of two or more of which are and have
been so registered, "Principal Party" shall refer to whichever of
such Persons is the issuer of the common stock having the
greatest aggregate market value.
(c) The Company shall not consummate any Flip-Over
Event unless prior thereto the Company and each Principal Party
and each other Person who may become a Principal Party shall have
executed and delivered to the Rights Agent a supplemental
agreement providing for the terms set forth in paragraphs (a) and
(b) of this Section 12 and further providing that, as soon as
practicable after the date of any Flip-Over Event, the Principal
Party will:
(i) prepare and file at its own expense a
registration statement under the Act with respect to
the Rights and the securities purchasable upon exercise
of the Rights on an appropriate form, will use its best
efforts to cause such registration statement to become
effective as soon as practicable after such filing and
will use its best efforts to cause such registration
statement to remain effective (with a prospectus at all
times meeting the requirements of the Act) until the
earliest of the Expiration Date, the Exchange Date and
the Redemption Date; and
(ii) will deliver to holders of the Rights
historical financial statements for the Principal Party
and each of its Affiliates which comply in all respects
with the requirements for registration on Form 10 under
the Exchange Act.
The Principal Party shall temporarily suspend, for a period of
time not to exceed 90 days following the occurrence of a Flip--
Over Event, the exercisability of the Rights in order to prepare
an file the registration statement referred to in clause (i)
above, and the Expiration Date shall be extended by the number of
days of such suspension. The provisions of this Section 12 shall
similarly apply to successive Flip-Over Events. In the event
that a Flip-Over Event shall occur at any time after the
occurrence of a Flip-In Event, the Rights which have not
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theretofore been exercised shall thereafter become exercisable in
the manner described in Section 12(a).
Section 13. Adjustment of Purchase Price, Number and
Kind of Shares or Number of Rights. The Purchase Price, the
number and kind of shares covered by each Right and the number of
Rights outstanding are subject to adjustment from time to time as
provided in this Section 13.
(a) In the event the Company shall at any time after
the date of this Agreement (A) declare a dividend or make a
distribution on the Preferred Stock payable in shares of
Preferred Stock into a larger number of shares, (B) subdivide the
outstanding Preferred Stock into a larger number of shares, (C)
combine the outstanding Preferred Stock into a smaller number of
shares, or (D) issue any shares of its capital stock in a
reclassification of the Preferred Stock (including any such
reclassification in connection with a consolidation or merger in
which the Company is the continuing or surviving corporation),
then in each such event, except as otherwise provided in this
Section 13(a), the Purchase Price in effect at the time of the
record date for such dividend or distribution, or of the
effective date of such subdivision, combination or
reclassification, and the number and kind of shares of Preferred
Stock or capital stock issuable on such date, shall be
proportionately adjusted so that the holder of any Rights (except
as provided in Section 7(e) of this Agreement) exercised on or
after such time shall be entitled to receive upon payment of the
Purchase Price in effect immediately prior to such date, the
aggregate number and kind of shares of Preferred Stock or capital
stock which, if such Rights had been exercised immediately prior
to such date and at a time when the Preferred Stock transfer
books of the Company were open, he would have owned upon such
exercise and been entitled to receive by virtue of such dividend,
distribution, subdivision, combination or reclassification. If
an event occurs which would require an adjustment under both
Section 11(a) of this Agreement and this Section 13(a), the
adjustment provided for in this Section 13(a) shall be in
addition to, and shall be made prior to any adjustment required
pursuant to Section 11(a).
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(b) In case the Company shall fix a record date for
the issuance of rights, options or warrants to all holders of
Preferred Stock entitling them to subscribe for or purchase
Preferred Stock (or Equivalent Preferred Stock) or securities
convertible into Preferred Stock or Equivalent Preferred Stock at
a price per share of Preferred Stock or per share of Equivalent
Preferred Stock (or having a conversion price per share, if a
security convertible into Preferred Stock or Equivalent Preferred
Stock) of less than the Current Market Price per share of
Preferred Stock on such record date, the Purchase Price to be in
effect after the record date shall be determined by multiplying
the Purchase Price in effect immediately prior to the record date
by a fraction,
(1) the numerator of which shall be the number of
shares of Preferred Stock and Equivalent Preferred Stock (if
any) outstanding on the record date, plus the number of
shares of Preferred Stock and Equivalent Preferred Stock
which the aggregate exercise price of the total number of
shares of Preferred Stock and/or Equivalent Preferred Stock
which are obtainable upon the exercise of the rights,
options or warrants (and/or the aggregate initial conversion
price of the convertible securities so offered) would
purchase at the current market price; and
(2) the denominator of which shall be the number of
shares of Preferred Stock and Equivalent Preferred Stock (if
any) outstanding on the record date, plus the number of
additional shares of Preferred Stock and/or Equivalent
Preferred Stock which may be obtained upon exercise of the
rights, options or warrants (or into which the convertible
securities so offered are initially convertible).
If the subscription price may be paid in a consideration part or
all of which shall be in a form other than cash, the value of
such consideration shall be as determined in good faith by the
Board of Directors of the Company, whose determination shall be
described in a statement filed with the Rights Agent and shall be
binding on the Rights Agent. Shares of Preferred Stock or
Equivalent Preferred Stock owned by or held for the account of
the Company shall not be deemed outstanding for the purpose of
any such computation. Such adjustment shall be made successively
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whenever such a record date is fixed; and in the event that
rights, options or warrants are not issued following an
adjustment, the Purchase Price shall again be adjusted to be the
Purchase Price which would be in effect if the record date had
not been fixed.
(c) In case the Company shall fix a record date for a
distribution to all holders of Preferred Stock (including any
such distribution made in connection with a consolidation or
merger in which the Company is the surviving corporation) of
evidences of indebtedness, cash (other than a regular periodic
cash dividend at an annual rate not in excess of 125% of the
annual rate of the cash dividend paid on the Preferred Stock
during the immediately preceding fiscal year), assets (other than
a dividend payable in Preferred Stock, but including any dividend
payable in stock other than Preferred Stock) or subscription
rights or warrants (excluding those referred to in Section
13(b)), the Purchase Price to be in effect after such record date
shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction,
(1) the numerator of which shall be the Current Market
Price per share of Preferred Stock on such record date, less
the fair market value (as determined in good faith by the
Board of Directors of the Company, whose determination shall
be described in a statement filed with the Rights Agent) of
the portion of the cash, assets or evidences of indebtedness
so to be distributed or of such subscription rights or
warrants applicable to one share of Preferred Stock; and
(2) the denominator of which shall be such current
market price per share of Preferred Stock.
Such adjustments shall be made successively whenever such a
record date is fixed; and in the event that such distribution is
not so made, the Purchase Price shall again be adjusted to be the
Purchase Price which would be in effect if such record date had
not been fixed.
(d) Anything herein to the contrary notwithstanding,
no adjustment in the Purchase Price shall be required unless such
adjustment would require an increase or decrease of at least 1%
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in the Purchase Price; provided, however, that any adjustments
which by reason of this Section 13(d) are not required to be made
shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 13 shall be made
to the nearest cent or to the nearest ten-thousandth of a share
of Common Stock or other share of one-millionth of a share of
Preferred Stock, as the case may be. Notwithstanding the first
sentence of this Section 13(d), any adjustment required by this
Section 13 shall be made no later than the earlier of (i) three
years from the date of the transaction which mandates the
adjustment or (ii) the earliest of the Expiration Date, the
Exchange Date and the Redemption Date.
(e) If as a result of an adjustment made pursuant to
Section 11(a), the holder of any Rights thereafter exercised
shall become entitled to receive any securities of the Company
other than shares of Preferred Stock, thereafter the number of
such other securities so receivable upon exercise of any Rights
shall be subject to adjustment from time to time in a manner and
on terms as nearly equivalent as practicable to the provisions
with respect to the shares contained in Section 13(a) through
(c), inclusive, and the provisions of Sections 7, 9, 10, 12 and
14 of this Agreement with respect to the Preferred Stock shall
apply on like terms to any such other securities.
(f) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder
shall evidence the right to purchase, at the adjusted Purchase
Price, the number of shares of Preferred Stock purchasable from
time to time hereunder upon exercise of the Rights, all subject
to further adjustment as provided in this Agreement.
(g) Unless the Company shall have exercised its
election as provided in Section 13(h), upon each adjustment of
the Purchase Price as a result of the calculations made in
Sections 13(b) and (c), each Right outstanding immediately prior
to the making of such adjustment shall thereafter evidence the
right to purchase, at the adjusted Purchase Price, that number of
one one-hundredths of a share of Preferred Stock (calculated to
the nearest one-millionth) obtained by
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(i) multiplying (x) the number of one one-hundredths of
a share of Preferred Stock covered by a Right immediately
prior to this adjustment by (y) the Purchase Price in effect
immediately prior to such adjustment of the Purchase Price
and
(ii) dividing the product so obtained by the Purchase
Price in effect immediately after such adjustment of the
Purchase Price.
(h) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights,
in substitution for any adjustment in the number of shares of
Preferred Stock purchasable upon the exercise of a Right. Each
of the Rights outstanding after the adjustment in the number of
Rights shall be exercisable for the number of one one-hundredths
of a share of Preferred Stock for which a Right was exercisable
immediately prior to such adjustment. Each Right held of record
prior to such adjustment of the number of Rights shall become
that number of Rights (calculated to the nearest one-millionth)
obtained by dividing the Purchase Price in effect immediately
prior to adjustment of the Purchase Price by the Purchase Price
in effect immediately after adjustment of the Purchase Price.
The Company shall make a public announcement of its election to
adjust the number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which
the Purchase Price is adjusted or any day thereafter, but, if the
Rights Certificates have been issued, shall be at least 10 days
later than the date of the public announcement. If Rights
Certificates have been issued, upon each adjustment of the number
of Rights pursuant to this Section 13(h), the Company shall, as
promptly as practicable, cause to be distributed to holders of
record of Rights Certificates on such record date Rights
Certificates evidencing, subject to Section 14 hereof, the
additional Rights to which such holders shall be entitled as a
result of such adjustment, or, at the option of the Company,
shall cause to be distributed to such holders of record in
substitution and replacement for the Rights Certificates held by
such holders prior to the date of adjustment, and upon surrender
thereof, if required by the Company, new Rights Certificates
evidencing all the Rights to which such holders shall be entitled
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after such adjustment. Rights Certificates so to be distributed
shall be issued, executed and countersigned in the manner
provided for herein (and may bear, at the option of the Company,
the adjusted Purchase Price) and shall be registered in the names
of the holders of record of Rights Certificates on the record
date specified in the public announcement.
(i) Irrespective of any adjustment or change in the
Purchase Price or the number of one one-hundredths of a share of
Preferred Stock issuable upon the exercise of the Rights, the
Rights Certificates theretofore and thereafter issued may
continue to express the Purchase Price per share and the number
of shares which were expressed in the initial Rights Certificates
issued hereunder.
(j) Before taking any action that would cause an
adjustment reducing the Purchase Price below the par value of the
shares of Preferred Stock issuable upon exercise of the Rights,
the Company shall take any corporate action which may, in the
opinion of its counsel, be necessary in order that the Company
may validly and legally issue fully paid and nonassessable shares
of Preferred Stock at such adjusted Purchase Price.
(k) In any case in which this Section 13 shall require
that an adjustment in the Purchase Price be made effective as of
a record date for a specified event, the Company may elect to
defer until the occurrence of such event the issuance to the
holder of any Rights exercised after such record date the shares
of Preferred Stock and other capital stock or securities, cash or
property of the Company, if any, issuable upon such exercise over
and above the shares of Preferred Stock and other capital stock
or securities, cash or property of the Company, if any, issuable
upon such exercise on the basis of the Purchase Price in effect
prior to such adjustment; provided, however, that the Company
shall deliver to such holder a due bill or other appropriate
instrument evidencing such holder's right to receive such
additional shares and other capital stock or securities, cash or
property upon the occurrence of the event requiring such
adjustment.
(l) Anything in this Section 13 to the contrary
notwithstanding, the Company shall be entitled to make such
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reductions in the Purchase Price, in addition to those
adjustments expressly required by this Section 13, as and to the
extent that in its sole discretion the Company shall determine to
be advisable in order that any (i) consolidation or subdivision
of the Preferred Stock, (ii) issuance wholly for cash of any
shares of Preferred Stock at less than the Current Market Price,
(iii) issuance wholly for cash of shares of Preferred Stock or
securities which by their terms are convertible into or
exchangeable or exercisable for shares of Preferred Stock, (iv)
stock dividends, or (v) issuance of rights, options or warrants
referred to in this Section 13, hereafter made by the Company to
holders of its Preferred Stock shall, if practicable, not be
taxable to such stockholders.
(m) The Company covenants and agrees that it shall not
(i) consolidate with, (ii) merge with or into, or (iii) directly
or indirectly sell, lease or otherwise transfer or dispose of, in
one or more transactions, assets or earning power aggregating
more than 50% of the assets or earning power of the Company and
its Subsidiaries taken as a whole, to any other Person, if at the
time of or immediately after such consolidation, merger, sale,
lease, transfer or disposition there are any rights, warrants or
other instruments or securities outstanding or agreements in
effect which would substantially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights.
(n) The Company covenants and agrees that, after the
Stock Acquisition Date, it will not, except as permitted by
Section 23 or Section 27 of this Agreement, take any action the
purpose or effect of which is to diminish substantially or
otherwise eliminate the benefits intended to be afforded by the
Rights, unless such action is approved by a majority of the
Continuing Directors.
(o) Anything in this Agreement to the contrary
notwithstanding, in the event that the Company shall at any time
prior to the Separation Date (i) declare a dividend or
distribution on the outstanding shares of Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding shares of
Common Stock, or (iii) combine the outstanding shares of Common
Stock into a smaller number of shares, the number of Rights
associated with each share of Common Stock then outstanding, or
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issued or delivered thereafter but prior to the Separation Date,
shall be proportionately adjusted so that the number of Rights
thereafter associated with each share of Common Stock following
any such event shall equal the result obtained by multiplying the
number of Rights associated with each share of Common Stock
immediately prior to such event by a fraction, (1) the numerator
of which shall be the total number of shares of Common Stock
outstanding immediately prior to the occurrence of the event and
(2) the denominator of which shall be the total number of shares
of Common Stock outstanding immediately following the occurrence
of such event.
(p) Whenever an adjustment is made as provided in
Sections 11, 12 and 13 of this Agreement, the Company shall (a)
promptly prepare a certificate setting forth such adjustment and
a brief statement of the facts accounting for such adjustment,
(b) promptly file with the Rights Agent and with each transfer
agent for the Preferred Stock and the Common Stock a copy of such
Certificate and (c) mail a brief summary thereof to each holder
of a Rights Certificate in accordance with Section 26 of this
Agreement. The Rights Agent shall be fully protected in relying
on any such certificate and on any adjustment therein contained.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue
fractional Rights or to distribute Rights Certificates which
evidence fractional Rights. In lieu of such fractional Rights,
there shall be paid to the registered holders of the Rights
Certificates with regard to which such fractional Rights would
otherwise be issuable, an amount in cash equal to the same
fraction of the Current Market Price of a whole Right as of the
date on which such fractional Rights would have been otherwise
issuable.
(b) The Company shall not be required to issue
fractions of shares of Preferred Stock (other than fractions
which are integral multiples of one one-hundredth of a share of
Preferred Stock) upon exercise of the Rights or to distribute
certificates which evidence fractional shares of Preferred Stock
(other than fractions which are integral multiples of one
one-hundredth of a share of Preferred Stock). In lieu of
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fractional shares of Preferred Stock that are not integral
multiples of one one-hundredth of a share of Preferred Stock, the
Company may pay to the registered holders of Rights Certificates,
at the time such Rights are exercised as herein provided, an
amount in cash equal to the same fraction of the Current Market
Price of one one-hundredth of a share of Preferred Stock as of
the date of such exercise.
(c) The holder of a Right by its acceptance thereof
expressly waives any right to receive any fractional Rights or
any fractional shares upon exercise of a Right.
Section 15. Rights of Action. All rights of action in
respect of this Agreement are vested in the respective registered
holders of the Rights Certificates (and, prior to the Separation
Date, the registered holders of the Common Stock); and any
registered holder of any Rights Certificate (or, prior to the
Separation Date, of the Common Stock) without the consent of the
Rights Agent or of the holder of any other Rights Certificate
(or, prior to the Separation Date, of the Common Stock), may, in
his own behalf and for his own benefit, enforce, and may
institute and maintain any suit, action or proceeding against the
Company to enforce, or otherwise act in respect of, his rights
pursuant to this Agreement. Without limiting the foregoing or
any remedies available to the holders of Rights, it is
specifically acknowledged that the holders of Rights would not
have an adequate remedy at law for any breach of this Agreement
and shall be entitled to specific performance of the obligations
hereunder and injunctive relief against actual or threatened
violations of the obligations hereunder of any Person subject to
this Agreement.
Section 16. Agreement of Rights Holders. Every holder
of a Right by accepting the same consents and agrees with the
Company and the Rights Agent and with every other holder of a
Right that:
(a) prior to the Separation Date, the Rights will be
transferable only in connection with the transfer of Common
Stock;
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(b) after the Separation Date, the Rights Certificates
are transferable only on the registry books of the Rights Agent
if surrendered at the principal corporate trust office of the
Rights Agent, duly endorsed or accompanied by a proper instrument
of transfer;
(c) the Company and the Rights Agent may deem and
treat the person in whose name a Rights Certificate (or, prior to
the Separation Date, the associated Common Stock certificate) is
registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or
writing on the Rights Certificates or the associated Common Stock
certificate made by anyone other than the Company or the Rights
Agent) for all purposes whatsoever, and neither the Company nor
the Rights Agent shall be affected by any notice to the contrary;
and
(d) notwithstanding anything in this Agreement to the
contrary, neither the Company nor the Rights Agent shall have any
liability to any holder of a Right or other Person as a result of
its inability to perform any of its obligations under this
Agreement by reason of any preliminary or permanent injunction or
other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative
agency or commission, or any statute, rule, regulation or
executive order promulgated or enacted by any governmental
authority prohibiting or otherwise restraining performance of
such obligation; provided, however, the Company must use its best
efforts to have any such order, decree or ruling lifted or
otherwise overturned.
Section 17. Rights Holder Not Deemed a Shareholder.
Except as otherwise expressly provided in this Agreement, no
holder, as such, of any Rights Certificate shall be entitled to
vote, receive dividends or be deemed for any purpose the holder
of the shares of Preferred Stock or any other securities of the
Company which may at any time be issuable on the exercise of the
Rights represented thereby, nor shall anything contained herein
or in any Rights Certificate be construed to confer upon the
holder of any Rights Certificate, as such, any of the rights of a
shareholder of the Company or any right to vote for the election
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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, or to receive dividends or subscription
rights, or otherwise, until and only to the extent that the Right
or Rights evidenced by such Rights Certificate shall have been
exercised in accordance with the provisions of this Agreement.
Section 18. Concerning the Rights Agent. The Company
agrees to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on
demand of the Rights Agent, its reasonable expenses and counsel
fees and disbursements and other disbursements incurred in the
administration and execution of this Agreement and the exercise
and performance of its duties hereunder. The Company also agrees
to indemnify the Rights Agent for, and to hold it harmless
against, any loss, liability, or expense, incurred without
negligence, bad faith or willful misconduct on the part of the
Rights Agent, for anything done or omitted by the Rights Agent in
connection with the acceptance and administration of this
Agreement, including the costs and expenses of defending against
any claim of liability in the premises. The indemnification
provided for hereunder shall survive the expiration of the Rights
and the termination of this Agreement.
The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or
omitted by it in connection with its administration of this
Agreement in reliance upon any Rights Certificate or certificate
for Common Stock or for other securities of the Company,
instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document believed by it
to be genuine and to be signed, executed and, where necessary,
verified or acknowledged, by the proper Person or Persons.
Section 19. Merger or Consolidation or Change of Name
of Rights Agent. Any corporation into which the Rights Agent or
any successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to the
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corporate trust business of the Rights Agent or any successor
Rights Agent, shall be the successor to the Rights Agent under
this Agreement without the execution or filing of any paper or
any further act on the part of any of the parties hereto,
provided that such corporation would be eligible for appointment
as a successor Rights Agent under the provisions of Section 21 of
this Agreement. In case at the time such successor Rights Agent
shall succeed to the agency created by this Agreement, any of the
Rights Certificates shall have been countersigned but not
delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such
Rights Certificates so countersigned; and in case at that time
any of the Rights Certificates shall not have been countersigned,
any successor Rights Agent may countersign such Rights
Certificates either in the name of the predecessor or in the name
of the successor Rights Agent; and in all such cases such Rights
Certificates shall have the full force provided in the Rights
Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall
be changed and at such time any of the Rights Certificates shall
have been countersigned but not delivered, the Rights Agent may
adopt the countersignature under its prior name and deliver
Rights Certificates so countersigned; and in case at that time
any of the Rights Certificates shall not have been countersigned,
the Rights Agent may countersign such Rights Certificates either
in its prior name or in its changed name; and in all such cases
such Rights Certificates shall have the full force provided in
the Rights Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, by all of which the
Company and the holders of Rights Certificates, by their
acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel
(who may be legal counsel for the Company), and the opinion of
such counsel shall be full and complete authorization and
protection to the Rights Agent as to any action taken or omitted
by it in good faith and in accordance with such opinion.
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(b) Whenever in the performance of its duties under
this Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter (including, without limitation,
the identity of any Acquiring Person) be proved or established by
the Company prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively
proved and established by a certificate signed by the Chairman of
the Board, the President, any Vice President, the Treasurer, any
Assistant Treasurer, the Secretary or any Assistant Secretary of
the Company and delivered to the Rights Agent; and such
certificate shall be full authorization to the Rights Agent, for
any action taken or suffered in good faith by it under the
provisions of this Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only
for its own negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of facts or recitals contained in
this Agreement or in the Rights Certificates or be required to
verify the same (except as to its countersignature on such Rights
Certificates), but all such statements and recitals are and shall
be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or
the execution and delivery hereof (except the due execution
hereof by the Rights Agent) or in respect of the validity or
execution of any Rights Certificate (except its countersignature
thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement
or in any Rights Certificate; nor shall it be responsible for any
adjustment required under the provisions of Sections 11 or 13 of
this Agreement or responsible for the manner, method or amount of
any such adjustment or the ascertaining of the existence of facts
that would require any such adjustment (except with respect to
the exercise of Rights evidenced by Rights Certificates after
actual notice of any such adjustment); nor shall it by any act
hereunder be deemed to make any representation or warranty as to
the authorization or reservation of any shares of Common Stock or
Preferred Stock to be issued pursuant to this Agreement or any
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Rights Certificate or as to whether.any shares of Common Stock or
Preferred Stock will, when so issued, be validly authorized and
issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts,
instruments and assurances as may reasonably be required by the
Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its
duties hereunder from the Chairman of the Board, the President,
any Vice President, the Secretary, any Assistant Secretary, the
Treasurer or any Assistant Treasurer of the Company, and to apply
to such officers for advice or instructions in connection with
its duties, and it shall not be liable for any action taken or
suffered to be taken by it in good faith in accordance with
instructions of any such officer.
(h) The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal in
any of the Rights or other securities of the Company or become
pecuniarily interested in any transaction in which the Company
may be interested, or contract with or lend money to the Company
or otherwise act as fully and freely as though it were not Rights
Agent under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or
for any other legal entity.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents,
and the Rights Agent shall not be answerable or accountable for
any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct provided reasonable care was
exercised in the selection and continued employment thereof.
(j) No provision of this Agreement shall require the
Rights Agent to expend or risk its own funds or otherwise incur
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any financial liability in the performance of any of its duties
hereunder or in the exercise of its rights if there shall be
reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not
reasonably assured to it.
(k) The Rights Agent shall not be required to take
notice or be deemed to have notice of any fact event or
determination under the Rights Agreement unless and until the
Rights Agent shall be specifically notified in writing by the
Company of such fact, event or determination.
Section 21. Change of Rights Agent. The Rights Agent
or any successor Rights Agent may resign and be discharged from
its duties under this Agreement upon 30 days' notice in writing
mailed to the Company, and to each transfer agent of the Common
Stock and Preferred Stock by registered or certified mail, and to
the holders of the Rights Certificates by first-class mail. The
Company may remove the Rights Agent or any successor Rights Agent
upon 30 days' notice in writing, mailed to the Rights Agent or
successor Rights Agent, as the case may be, and to each transfer
agent of the Common Stock and Preferred Stock, by registered or
certified mail, and to the holders of the Rights Certificates by
first-class mail. If the Rights Agent shall resign or be removed
or shall otherwise become incapable of acting, the Company shall
appoint a successor to the Rights Agent. If the Company shall
fail to make such appointment within a period of 30 days after
giving notice of such removal or after it has been notified in
writing of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the holder of a Rights
Certificate (who shall, with such notice, submit his Rights
Certificate for inspection by the Company), then the registered
holder of any Rights Certificate may apply to any court of
competent jurisdiction for the appointment of a new Rights Agent.
Any successor Rights Agent, whether appointed by the Company or
by such a court, shall be a corporation organized and doing
business under the laws of the United States or of the State of
Mississippi (or of any other state of the United States so long
as such corporation is authorized to do business as a banking
institution in the State of Mississippi), in good standing, which
is authorized under such laws to exercise corporate trust powers
and is subject to supervision or examination by federal or state
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<PAGE>
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 shall be vested
with the same powers, rights, duties and responsibilities as if
it had been originally named as Rights Agent without further act
or deed; but the predecessor Rights Agent shall deliver and
transfer to the successor Rights Agent any property at the time
held by it hereunder, and execute and deliver any further
assurance, conveyance, act or deed necessary for the purpose.
Not later than the effective date of any such appointment, the
Company shall file notice thereof in writing with the predecessor
Rights Agent and each transfer agent of the Common Stock and the
Preferred Stock, and mail a notice thereof in writing to the
registered holders of the Rights Certificates. Failure to give
any notice provided for in this Section 21, however, or any
defect therein, shall not affect the legality or validity of the
resignation or removal of the Rights Agent or the appointment of
the successor Rights Agent, as the case may be.
Section 22. Issuance of New Rights Certificates.
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new
Rights Certificates evidencing Rights in such form as may be
approved by its Board of Directors to reflect any adjustment or
change in the Purchase Price per share and the number or kind or
class of shares or other securities or property purchasable under
the Rights Certificates made in accordance with the provision of
this Agreement.
Section 23. Redemption and Termination.
(a) The Board of Directors of the Company may, at its
option, at any time prior to 5:00 P.M., Chicago, Illinois time,
on the earlier of (i) the tenth day following the Stock
Acquisition Date, subject to extension by the Board of Directors
for a period of time up to, but not exceeding, ten additional
days, or (ii) the Expiration Date, redeem all but not less than
all the then outstanding Rights at a redemption price of $0.01
per Right, appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after the date
hereof (such redemption price being hereinafter referred to as
the "REDEMPTION PRICE"); provided, however, that at the time of
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the redemption the Company's Board of Directors consists of a
majority of Continuing Directors. Notwithstanding anything in
this Agreement to the contrary, no Rights may be exercised at any
time that the Rights are subject to redemption in accordance with
the terms of this Agreement.
(b) Immediately upon the action of the Board of
Directors of the Company extending the redemption period pursuant
to Section 23(a)(i), evidence of which shall have been filed with
the Rights Agent, the Company shall issue a press release
indicating the date to which the Board of Directors has extended
its right to redeem the Rights.
(c) Notwithstanding the provisions of Section 23(a) of
this Agreement, following the expiration of the Company's right
to redeem the Rights due to the occurrence of a Stock Acquisition
Date, and prior to the occurrence of a Triggering Event, the
right of redemption may be reinstated by the Board of Directors
of the Company to allow the Rights to be redeemed in connection
with a merger or other business combination involving the Company
which has been approved by the affirmative vote of 67% of the
total number of outstanding shares of Common Stock which are not
beneficially owned by any Acquiring Person; provided that at the
time of the reinstatement the Board of Directors consists of a
majority of Continuing Directors. Once reinstated, the
redemption shall be effected in the manner provided for in
Sections 23(b) and (d) of this Agreement for the purpose of
effectuating the approved merger or other business combination.
(d) Immediately upon the action of the Board of
Directors of the Company ordering the redemption of the Rights,
evidence of which shall have been filed with the Rights Agent and
without any further action and without any notice, the right to
exercise the Rights will terminate and the only right thereafter
of the holders of Rights shall be to receive the Redemption
Price. Within 10 days after the action of the Board of Directors
ordering the redemption of the Rights, the Company shall give
notice of such redemption to the Rights Agent and the holders of
the then outstanding Rights by mailing such notice to all such
holders at their last addresses as they appear upon the registry
books of the Rights Agent or prior to the Separation Date, on the
registry books of the Transfer Agent for the Common Stock. Any
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<PAGE>
notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice.
Each such notice of redemption will state the method by which the
payment of the Redemption Price will be made. In any case,
failure to give such notice to any particular holder of Rights
shall not affect the sufficiency of the notice to other holders
of Rights. Neither the Company nor any of its Affiliates or
Associates may redeem for value any Rights at any time, in any
manner, other than that specifically set forth in this Section
23, and neither the Company nor any of its Affiliates or
Associates may acquire or purchase for value any Rights at any
time, in any manner, other than in connection with the purchase
of shares of associated Common Stock prior to the Separation
Date.
Section 24. Exchange.
(a) The Company may, at its option but subject to
receipt of any required regulatory approvals, by action of the
Board of Directors, at any time after any Person becomes an
Acquiring Person, exchange all or part of the then outstanding
and exercisable Rights (which shall not include Rights that have
become void pursuant to the provisions of Section 7(e)) for
shares of Common Stock at an exchange ratio of one share of
Common Stock per Right, appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring
after the date hereof (such exchange ratio being herein referred
to as the "EXCHANGE RATIO"). Notwithstanding the foregoing, the
Board of Directors shall not be empowered to effect such exchange
at any time after any Person (other than the Company, any
Subsidiary of the Company any employee plan of the Company or of
a Subsidiary of the Company or any Person holding Common Shares
for or pursuant to the terms of any such employee plan), together
with all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 50 percent or more of the Common Stock then
outstanding.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the exchange of any Rights
pursuant to Section 24(a) and without any further action and
without any notice, the right to exercise such Rights shall
terminate and the only right thereafter of a holder of such
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Rights shall be to receive that number of shares of Common Stock
equal to the number of such Rights held by such holder multiplied
by the Exchange Ratio. The Company shall promptly give public
notice of any such exchange; provided, however, that the failure
to give, or any defect in, such notice shall not affect the
validity of such exchange. The Company promptly shall mail a
notice of any such exchange to all of the holders of such Rights
at their last addresses as they appear upon the registry books of
Rights Agent. Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of exchange will state the
method by which the exchange of the Common Stock for Rights will
be effected and, in the event of any partial exchange, the number
of Rights which will be exchanged. Any partial exchange shall be
effected pro rata based on the number of Rights (other than
Rights which have become void pursuant to the provisions of
Section 7(e)) held by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the
Company, at its option, may substitute Preferred (or Equivalent
Preferred Stock) for shares of Common Stock exchangeable for
Rights, at the initial rate of one one-hundredth of a share of
Preferred Stock (or Equivalent Preferred Stock) for each share of
Common Stock, as appropriately adjusted to reflect adjustments in
the voting rights of the Preferred Stock pursuant to the terms
thereof, so that the fraction of a share of Preferred Stock
delivered in lieu of each share of Common Stock shall have at
least the same voting rights as one share of Common Stock.
(d) The Company shall not be required to issue
fractions of shares of Common Stock or to distribute certificates
which evidence fractional Common Stock. In lieu of such
fractional shares, the Company shall pay to the registered
holders of the Right Certificates with regard to which such
fractional shares would otherwise be issuable an amount in cash
equal to the same fraction of the Current Market Value of a whole
share of Common Stock.
Section 25. Notice of Certain Events.
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(a) In case the Company shall propose (i) to pay any
dividend payable in stock of any class to the holders of
Preferred Stock or to make any other distribution to the holders
of Preferred Stock (other than a regular quarterly cash dividend
at a rate not in excess of $20 per share), or (ii) to offer to
the holders of Preferred Stock rights or warrants to subscribe
for or to purchase any additional shares of Preferred Stock or
shares of stock of any class or any other securities, rights or
options, or (iii) to effect any reclassification of its Preferred
Stock (other than a reclassification involving only the
subdivision of outstanding shares of Preferred Stock), or (iv) to
effect any Flip-Over Event, or (v) to effect the liquidation,
dissolution or winding up of the Company, then, in each such
case, the Company shall give to each holder of a Rights
Certificate, in accordance with Section 26, a notice of such
proposed action, which shall specify the record date for the
purposes of such stock dividend, distribution of rights or
warrants, or the date on which such reclassification, Flip-Over
Event, liquidation, dissolution, or winding up is to take place
and the date of participation therein by the holders of the
shares of Preferred Stock, if any such date is to be fixed, and
such notice shall be so given in the case of any action covered
by clause (i) or (ii) above at least 20 days prior to the record
date for determining holders of the shares of Preferred Stock for
purposes of such action, and in the case of any such other
action, at least 20 days prior to the date of the taking of such
proposed action or the date of participation therein by the
holders of the shares of Preferred Stock whichever shall be the
earlier.
(b) Upon the occurrence of a Flip-In Event or a
Flip-Over Event, the Company or Principal Party, as the case may
be, shall as soon as practicable thereafter give to each holder
of a Rights Certificate, to the extent feasible and in accordance
with Section 26, a notice of the occurrence of such event and the
consequences thereof to holders of Rights under Sections 11(a) or
12(a) of this Agreement, as the case may be.
Section 26. Notices. Notices or demands authorized by
this Agreement to be given or made by the Rights Agent or by the
holder of any Rights Certificate to or on the Company shall be
sufficiently given or made if sent by first-class mail, postage
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<PAGE>
prepaid, addressed (until another address is filed in writing
with the Rights Agent) as follows:
Mississippi Chemical Corporation
P.O. Box 388
Yazoo City, Mississippi 39194-0388
Attention: Secretary
Subject to the provisions of Section 21, any notice or demand
authorized by this Agreement to be given or made by the Company
or by the holder of any Rights Certificate to or on the Rights
Agent shall be sufficiently given or made if delivered by
first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Company) as follows:
Harris Trust and Savings Bank
311 West Monroe Street
Chicago, Illinois 60606
Attention: Susan M. Shadel
Notices or demands authorized by this Agreement to be given or
made by the Company or the Rights Agent to the holder of any
Rights Certificate shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed to such holder at
the address of such holder as shown on the registry books of the
Company. The Company shall deliver a copy of any notice or
demand it delivers to the holder of any Rights Certificate to the
Rights Agent and the Rights Agent shall deliver a copy of any
notice or demand it deliver to the holder of any Rights
Certificate to the Company.
Section 27. 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
Certificates in order to cure any ambiguity, to correct or
supplement any provision contained herein which may be defective
or inconsistent with any other provisions herein or to change or
supplement the provisions hereunder in any manner which the
Company may deem necessary or desirable and which shall not
adversely affect the interests of the holders of rights
Certificates other than an Acquiring Person; provided, however,
that this Agreement may not be supplemented or amended in any way
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<PAGE>
unless the Company's Board of Directors consists of a majority of
Continuing Directors at the time of such amendment or supplement
and provided further that no amendment or supplement may be made
if the effect would be to extend or shorten the redemption period
after the Stock Acquisition Date or change the Purchase Price or
the Redemption Price.
Section 28. Successors. All the covenants and
provisions of this Agreement by or for the benefit of the Company
or the Rights Agent shall bind and inure to the benefit of their
respective successors and assigns hereunder.
Section 29. Benefits of this Agreement. Nothing in
this Agreement shall be construed to give to any Person other
than the Company, the Rights Agent and the registered holders of
the Rights Certificates (and, prior to the Separation Date, the
Common Stock) any legal or equitable right, remedy or claim under
this Agreement; but this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the
registered holders of the Rights Certificates (and, prior to the
Separation Date, the Common Stock).
Section 30. Severability. If any term, provision,
covenant or restriction of this Agreement is held by a court of
competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants
and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
Section 31. Governing Law. This Agreement, each Right
and each Rights Certificate issued hereunder shall be deemed to
be a contract made under the laws of the State of Mississippi and
for all purposes shall be governed by and construed in accordance
with the laws of such State applicable to contracts made and to
be performed entirely within such State.
Section 32. Counterparts. This Agreement may be
executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and
the same instrument.
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Section 33. Descriptive Headings. Descriptive
headings of the several Sections of this Agreement are inserted
for convenience only and shall not control or affect the meaning
or construction of any of the provisions hereof.
* * * *
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and their respective corporate
seals to be hereunto affixed and attested, all as of the day and
year first above written.
HARRIS TRUST MISSISSIPPI CHEMICAL CORPORATION
AND SAVINGS BANK
By: /s/ T. D. Grady By: /s/ Charles O. Dunn
Name: T. D. Grady Name: Charles O. Dunn
Title: Vice President Title: President and Chief
Executive Officer
Attest: Attest:
By: /s/ K. W. Penn By: /s/ Rosalyn B. Glascoe
Name: K. W. Penn Name: Rosalyn B. Glascoe
Title: Assistant Secretary Title: Corporate Secretary
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Exhibit A
FORM OF
CERTIFICATE OF DESIGNATIONS
OF PREFERRED STOCK
of
MISSISSIPPI CHEMICAL CORPORATION
Pursuant to Section 79-4-6.02 of the
Mississippi Business Corporation Act
We, Coley L. Bailey, Chairman of the Board of Directors and
Rosalyn B. Glascoe, Secretary, of Mississippi Chemical
Corporation, a corporation organized and existing under the
Mississippi Business Corporation Act, in accordance with the
provisions of Section 79-4-6.02 thereof, DO HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board of
Directors by the Certificate of Incorporation of the said
Corporation, the said Board of Directors on August 2, 1994,
adopted the following resolution creating a series of 250,000
shares of Preferred Stock designated as "Preferred Stock, Series
A":
RESOLVED, that pursuant to the authority vested in the Board
of Directors of this Corporation in accordance with the
provisions of its Certificate of Incorporation a series of
Preferred Stock of the Corporation be, and it hereby is, created,
and that the designation and amount thereof and the voting
powers, preferences and relative, participating, optional and
other special rights of the shares of such series, and the
qualifications, limitations or restrictions thereof are as
follows:
Section 1. Designation and Amount. The shares of such
series shall be designated as "Preferred Stock, Series A" (the
A-1
<PAGE>
"Preferred Stock") and the number of shares constituting such
series shall be 250,000.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the holders
of any shares of any series of preferred stock ranking prior
and superior to the shares of Preferred Stock with respect to
dividends, the holders of shares of Preferred Stock, in
preference to the holders of common stock, $.01 par value per
share, of the Corporation (the "Common Stock") and of any
other junior stock, shall be entitled to receive, when, as and
if declared by the Board of Directors out of funds legally
available for the purpose, quarterly dividends payable in cash
on the fifteenth day of March, June, September and December in
each year (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the first
Quarterly Dividend Payment Date after the first issuance of a
share or fraction of a share of Preferred Stock, in an amount
per share (rounded to the nearest cent) equal to the greater
of (a) $25.00 or (b) subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share
amount of all cash dividends, and 100 times the aggregate per
share amount (payable in kind) of all non-cash dividends or
other distributions other than a dividend payable in shares of
Common Stock or a subdivision of the outstanding shares of
Common Stock (by reclassification or otherwise), declared on
the Common Stock since the immediately preceding Quarterly
Dividend Payment Date or, with respect to the first Quarterly
Dividend Payment Date, since the first issuance of any share
or fraction of a share of Preferred Stock. In the event the
Corporation shall at any time on or after August 15, 1994
declare or pay any dividend on Common Stock payable in shares
of Common Stock, or effect a subdivision of combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of
shares of Common Stock, then in each such case the amount to
which holders of shares of Preferred Stock were entitled
immediately prior to such event under clause (b) of the
preceding sentence shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of
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<PAGE>
shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such
event.
(B) The Corporation shall declare a dividend or
distribution on the Preferred Stock as provided in paragraph
(A) of this Section immediately after it declares a dividend
or distribution on the Common Stock (other than a dividend
payable in shares of Common Stock); provided that, in the
event no dividend or distribution shall have been declared on
the Common Stock during the period between any Quarterly
Dividend Payment Date and the next subsequent Quarterly
Dividend Payment Date, a dividend of $25.00 per share on the
Preferred Stock shall nevertheless be payable on such
subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such
shares of Preferred Stock, unless the date of issue of such
shares is prior to the record date for the first Quarterly
Dividend Payment Date, in which case dividends on such shares
shall begin to accrue from the date of issue of such shares,
or unless the date of issue is a Quarterly Dividend Payment
Date or is a date after the record date for the determination
of holders of shares of Preferred Stock entitled to receive a
quarterly dividend and before such Quarterly Dividend Payment
Date, in either of which events such dividends shall begin to
accrue and be cumulative from such Quarterly Dividend Payment
Date. Accrued but unpaid dividends shall not bear interest.
Dividends paid on the shares of Preferred Stock in an amount
less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata
on a share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for
the determination of holders of shares of Preferred Stock
entitled to receive payment of a dividend or distribution
declared thereon, which record date shall be not more than 60
days prior to the date fixed for the payment thereof.
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<PAGE>
Section 3. Voting Rights. The holders of shares of
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth, each share of Preferred Stock shall entitle the holder
thereof to 100 votes on all matters submitted to a vote of the
stockholders of the Corporation. In the event the Corporation
shall at any time on or after August 15, 1994 declare or pay
any dividend on Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common
Stock, then in each such case the number of votes per share to
which holders of shares of Preferred Stock were entitled
immediately prior to such event shall be adjusted by
multiplying such number by a fraction, the numerator of which
is the number of shares of Common Stock outstanding
immediately after such event, and the denominator of which is
the number of shares of Common Stock that were outstanding
immediately prior to such event.
(B) Except as otherwise provided herein or by law, the
holders of shares of Preferred Stock and the holders of shares
of Common Stock shall vote together as one class on all
matters submitted to a vote of stockholders of the
Corporation.
(C) Except as set forth herein, holders of Preferred Stock
shall have no special voting rights and their consent shall
not be required (except to the extent they are entitled to
vote with holders of Common Stock as set forth herein) for
taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and
unpaid dividends and distributions, whether or not declared,
on shares of Preferred Stock outstanding shall have been paid
in full, the Corporation shall not:
A-4
<PAGE>
(i) declare or pay dividends on, or make any other
distributions on, any shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding
up) to the Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or
winding up) with the Preferred Stock, except dividends paid
ratably on the Preferred Stock and all such parity stock on
which dividends are payable or in arrears in proportion to
the total amounts to which the holders of all such shares
are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or
winding up) to the Preferred Stock, provided that the
Corporation may at any time redeem, purchase or otherwise
acquire shares of any such parity stock in exchange for
shares of any stock of the Corporation ranking junior
(either as to dividends or upon dissolution, liquidation or
winding up) to the Preferred Stock; or
(iv) purchase or otherwise acquire for consideration
any shares of Preferred Stock, or any shares of stock
ranking on a parity with the Preferred Stock, except in
accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of
Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences of
the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the
respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration
any shares of stock of the Corporation unless the Corporation
could, under paragraph (A) of this Section 4, purchase or
otherwise acquire such shares at such time and in such manner.
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<PAGE>
Section 5. Reacquired Shares. Any shares of Preferred
Stock purchased or otherwise acquired by the Corporation in any
manner whatsoever shall be retired and cancelled promptly after
the acquisition thereof. All such shares shall upon their
cancellation become authorized but unissued shares of preferred
stock and may be reissued as part of a new series of preferred
stock to be created by resolution or resolutions of the Board of
Directors, subject to the conditions and restrictions on issuance
set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. Upon
any liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (1) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Preferred Stock unless, prior
thereto, the holders of shares of Preferred Stock shall have
received $100.00 per share, plus an amount equal to accrued and
unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment, provided that the holders
of shares of Preferred Stock shall be entitled to receive an
aggregate amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 100 times the
aggregate amount to be distributed per share to holders of Common
Stock, or (2) to the holders of stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding up)
with the Preferred Stock, except distributions made ratably on
the Preferred Stock and all other such parity stock in proportion
to the total amounts to which the holders of all such shares are
entitled upon such liquidation, dissolution or winding up. In
the event the Corporation shall at any time on or after August
15, 1994 declare or pay any dividend on Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the aggregate amount to
which holders of shares of Preferred Stock were entitled
immediately prior to such event under the proviso in clause (1)
of the preceding sentence shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of
shares of Common Stock outstanding immediately after such event
A-6
<PAGE>
and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common
Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case
the shares of Preferred Stock then outstanding shall at the same
time be similarly exchanged or changed in an amount per share
(subject to the provision for adjustment hereinafter set forth)
equal to 100 times the aggregate amount of stock, securities,
cash and/or any other property (payable in kind), as the case may
be, into which or for which each share of Common Stock is changed
or exchanged. In the event the Corporation shall at any time on
or after August 15, 1994 declare or pay any dividend on Common
Stock payable in shares of Common Stock, or effect a subdivision
or combination or consolidation of the outstanding shares of
Common Stock (by reclassification or otherwise) into a greater or
lesser number of shares of Common Stock, then in each such case
the amount set forth in the preceding sentence with respect to
the exchange or change of shares of Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator
of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding
immediately prior to such event.
Section 8. No Redemption. The shares of Preferred Stock
shall not be redeemable.
Section 9. Amendment. The Certificate of Incorporation of
the Corporation shall not be amended in any manner which would
materially alter or change the powers, preferences or special
rights of the Preferred Stock so as to affect them adversely
without the affirmative vote of the holders of two-thirds or more
of the outstanding shares of Preferred Stock, voting together as
a single class.
A-7
<PAGE>
IN WITNESS WHEREOF, we have executed and subscribed
this Certificate and do affirm the foregoing as true under the
penalties of perjury as of this ____ day of __________, 1994.
___________________________________
Coley L. Bailey
Chairman of the Board of Directors
ATTEST:
_____________________________
Rosalyn B. Glascoe, Secretary
A-8
<PAGE>
Exhibit B
[Form of Rights Certificate]
Certificate No. R- ____________ Rights
NOT EXERCISABLE AFTER AUGUST 15, 2004 OR EARLIER IF NOTICE
OF REDEMPTION OR EXCHANGE IS GIVEN.
THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE
COMPANY, ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.
[THE RIGHTS REPRESENTED BY THIS CERTIFICATE ARE OR WERE
BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN
ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN
ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT). ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE
RIGHTS REPRESENTED HEREBY MAY BECAME NULL AND VOID IN THE
CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS
AGREEMENT.]
RIGHTS CERTIFICATE
MISSISSIPPI CHEMICAL CORPORATION
This certifies that ________________________________ or
registered assigns, is the registered owner of the number of
Rights set forth above, each of which entitles the owner thereof,
subject to the terms, provisions and conditions of the Rights
Agreement dated as of August 8, 1994 (the "RIGHTS AGREEMENT")
between Mississippi Chemical Corporation, a Mississippi
corporation (the "COMPANY"), and Harris Trust and Savings Bank
(the "RIGHTS AGENT"), unless notice of redemption shall have been
previously given by the Company, to purchase from the Company at
any time after the Separation Date (as such term is defined in
the Rights Agreement) and prior to 5:00 P.M. (Chicago, Illinois
time) on August 15, 2004 at the principal corporate trust office
of the Rights Agent, or at the office of its successor as Rights
Agent, one one-hundredth of a fully paid nonassessable share of
the Preferred Stock, Series A (the "PREFERRED STOCK"), par value
B-1
<PAGE>
$0.01 per share, of the Company, at a purchase price of $50.00
per one one-hundredth share (the "PURCHASE PRICE") upon
presentation and surrender of this Rights Certificate with the
Form of Election to Purchase duly executed. The Purchase Price
may be paid in cash or by certified bank check or money order
payable to the order of the Company.
The number of Rights evidenced by this Rights Certificate
(and the number of shares of Preferred Stock which may be
purchased upon exercise thereof) and the Purchase Price set forth
above have been determined as of August 15, 1994, based on the
Common Stock of the Company as constituted at such date. As
provided in the Rights Agreement, the Purchase Price and the
number of shares of Preferred Stock or other securities, cash or
other property which may be purchased upon the exercise of the
Rights evidenced by this Rights Certificate are subject to
modification and adjustment upon the happening of certain events.
If the Rights evidenced by this Rights Certificate are or
were formerly beneficially owned, on or after the earlier of the
Separation Date and the Stock Acquisition Date, by an Acquiring
Person or an Affiliate, Associate or direct or indirect
transferee of an Acquiring Person, such Rights may become null
and void and the holder of any such Right (including any
subsequent holder) shall not have any right with respect to such
Right.
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. Capitalized terms used in this Rights
Certificate have the same meanings as such terms are defined in
the Rights Agreement. Copies of the Rights Agreement are on file
at the principal executive offices of the Company and the
above-mentioned office of the Rights Agent.
This Rights Certificate, with or without other Rights
Certificates, upon surrender at the principal corporate trust
B-2
<PAGE>
office of the Rights Agent, may be exchanged for another Rights
Certificate or Rights Certificates of like tenor and date
evidencing Rights entitling the holder to purchase a like
aggregate number of shares of Preferred Stock or other property
as the Rights evidenced by the Rights Certificate or Rights
Certificates surrendered entitled such holder to purchase. If
this Rights Certificate shall be exercised in part, the holder
shall be entitled to receive upon surrender hereof another Rights
Certificate or Rights Certificates for the number of whole Rights
not exercised.
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate may be redeemed by the
Company at its option at a redemption price of $0.01 per Right at
any time prior to the earlier of (i) the close of business on the
tenth day following the time it becomes public that an Acquiring
Person has become such (with the possibility of an extension for
an additional ten (10) days) and (ii) the Expiration Date.
No fractional shares of Preferred Stock (other than
fractions that are integral multiples of one one-hundredth of
share of Preferred Stock, which may, at the election of the
Company, be evidenced by depository receipts) are required to be
issued upon the exercise of any Right or Rights evidenced hereby,
but in lieu thereof the Company may elect to make a cash payment,
as provided in the Rights Agreement.
No holder of this Rights Certificate, as such, shall be
entitled to vote or to receive dividends or shall be deemed, for
any purpose, the holder of Preferred Stock or of any other
securities, cash or property which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights
Agreement or this Certificate be construed to confer upon the
holder hereof, as such, any of the rights of a stockholder of the
Company, including, without limitation, any right to vote for the
election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings
or other actions affecting stockholders (except as provided in
the Rights Agreement), or to receive dividends or subscription
rights, or to institute, as a holder of Preferred Stock or other
securities issuable on the exercise of the Rights represented by
B-3
<PAGE>
this Certificate, any derivative action, or otherwise, until and
only to the extent the Right or Rights evidenced by this Rights
Certificate shall have been exercised as provided in the Rights
Agreement.
This Rights Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights
Agent.
WITNESS the facsimile signature of the proper officers of
the Company and its corporate seal. Dated as of __________,
19__.
MISSISSIPPI CHEMICAL CORPORATION
By: ____________________________________
Title:
B-4
<PAGE>
ATTEST:
______________________________
Secretary
Countersigned:
______________________________
By____________________________
Authorized Signature
B-5
<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 hereby irrevocably constitute and appoint
_____________________ Attorney to transfer the within Rights
Certificate on the books of the within-named Company, with full
power of substitution.
Dated: ________________________, 19__
________________________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or
trust company having an office or correspondent in the United
States.
B-6
<PAGE>
CERTIFICATE
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) this Rights Certificate [ ] is [ ] is not being sold,
assigned and transferred by or on behalf of a Person who is or
was an Acquiring Person or an Affiliate or Associate of any such
Acquiring Person (as such terms are defined pursuant to the
Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it [ ] did [ ] did not acquire the Rights evidenced
by this Rights Certificate from any Person who is or was an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person.
Dated: __________________, 19__ Signature ____________________
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or
trust company having an office or correspondent in the United
States.
NOTICE
The signature to the foregoing Assignment must correspond to
the name as written upon the face of this Rights Certificate in
every particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above in the Form
of Assignment is not completed, the Company will deem the
beneficial owner of the Rights evidenced by this Right
Certificate to be an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement) and, in
B-7
<PAGE>
the case of an Assignment, will affix a legend to that effect on
any Rights Certificate issued in exchange for this Rights
Certificate.
B-8
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise the Rights
represented by this Rights Certificate)
To: Mississippi Chemical Corporation
The undersigned hereby irrevocably elects to exercise
__________________ Rights represented by this Rights Certificate
to purchase the shares of Preferred Stock, Series A or other
securities, cash or other property issuable upon the exercise of
such Rights and requests that certificates for such shares or
other securities be issued in the name of, and such cash or other
property be paid to:
Please insert social security or other identifying number
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
If such number of Rights shall not be all the Rights evidenced by
this Rights Certificate, a new Rights Certificate for the
remaining balance of such Rights shall be registered in the name
of and delivered to:
Please insert social security or other identifying number
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
Dated: _______________, 19__
Signature ______________________________
(Signature must conform in all respects
to name of holder as specified on the
face of this Rights Certificate)
B-9
<PAGE>
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or
trust company having an office or correspondent in the United
States.
B-10
<PAGE>
CERTIFICATE
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) this Rights Certificate [ ] is [ ] is not being
exercised by or on behalf of a Person who is or was an Acquiring
Person or an Affiliate or Associate of any such Acquiring Person
(as such terms are defined pursuant to the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it [ ] did [ ] did not acquire the Rights evidenced
by this Rights Certificate from any Person who is or was an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person.
Dated: _____________, 19__ Signature _________________________
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or
trust company having an office or correspondent in the United
States.
NOTICE
The signature on the foregoing Form of Election to Purchase
and Certificate must correspond to the name as written upon the
face of this Rights Certificate in every particular, without
alteration or enlargement or any change whatsoever.
In the event the certification set forth above in the Form
of Election is not completed, the Company will deem the
beneficial owner of the Rights evidenced by this Rights
Certificate to be an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement) and, in
the case of an Assignment, will affix a legend to that effect on
B-11
<PAGE>
any Rights Certificate issued in exchange for this Rights
Certificate.
B-12
<PAGE>
Exhibit C
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED STOCK
On August 2, 1994, the Board of Directors of Mississippi
Chemical Corporation, a Mississippi corporation (the "COMPANY"),
declared a dividend of one preferred share purchase right (a
"RIGHT") for each share of Common Stock, $0.01 par value, of the
Company (the "COMMON STOCK"). The dividend is payable on August
15, 1994 to shareholders of record at the close of business on
August 5, 1994 (the "RECORD DATE") and with respect to all shares
of Common Stock that become outstanding after the Record Date and
prior to the earliest of the Separation Date (as defined below),
the redemption of the Rights, the exchange of the Rights and the
expiration of the Rights. Except as set forth below and subject
to adjustment as provided in the Rights Agreement (as defined
below), each Right entitles the registered holder to purchase
from the Company one one-hundredth of a share of the Company's
Preferred Stock, Series A, $0.01 par value per share (the
"PREFERRED STOCK"), at an exercise price of $50.00 per share (the
"PURCHASE PRICE"). The description and terms of the Rights are
set forth in a Rights Agreement dated as of August 8, 1994 (the
"RIGHTS AGREEMENT"), between the Company and Harris Trust and
Savings Bank, as Rights Agent (the "RIGHTS AGENT").
The Rights will be evidenced by Common Stock certificates and
not separate certificates until the earlier to occur of (i) 10
days following the date of public disclosure that a person or
group, together with persons affiliated or associated with it (an
"ACQUIRING PERSON"), has acquired, or obtained the right to
acquire, beneficial ownership of 15% or more of the outstanding
Common Stock (the "STOCK ACQUISITION DATE") and (ii) 10 days
following commencement or disclosure of an intention to commence
a tender offer or exchange offer by a person other than the
Company and certain related entities if, upon consummation of the
offer, such person or group, together with persons affiliated or
associated with it, could acquire beneficial ownership of 25% or
more of the outstanding Common Stock (the earlier of such dates
being called "SEPARATION DATE"). Until the Separation Date (or
earlier redemption or expiration of the Rights), the transfer of
Common Stock will also constitute transfer of the associated
Rights. Following the Separation Date, separate certificates
will evidence the Rights.
C-1
<PAGE>
The Rights will first become exercisable on the Separation
Date (unless sooner redeemed). The Rights will expire at the
close of business on August 15, 2004 (the "EXPIRATION DATE"),
unless earlier redeemed or exchanged by the Company as described
below.
The Purchase Price and the number of shares of Preferred Stock
or other securities, cash or other property issuable upon
exercise of the Rights are subject to adjustment from time to
time to prevent dilution (i) in the event of a stock dividend or
distribution on, or a subdivision, combination or
reclassification of, the Preferred Stock, (ii) upon the grant to
holders of the Preferred Stock of certain rights, options,
warrants to subscribe for Preferred Stock or securities
convertible into Preferred Stock at less than the current market
price of the Preferred Stock, or (iii) upon the distribution to
holders of the Preferred Stock of other securities, cash
(excluding regular periodic cash dividends at an annual rate not
in excess of 125% of the annualized rate of cash dividends paid
during the preceding fiscal year), property, evidences of
indebtedness, or assets.
In the event that, following the Separation Date, the Company
is acquired in a merger or other business combination in which
the Common Stock does not remain outstanding or is changed or 50%
or more of its consolidated assets or earning power is sold,
leased, exchanged, mortgaged, pledged or otherwise transferred or
disposed of (in one transaction or a series of transactions) the
Rights will "FLIP OVER" and entitle each holder of a Right to
purchase, upon the exercise of the Right at the then-current
Purchase Price, that number of shares of common stock of the
acquiring company (or, in certain circumstances, one of its
affiliates) which at the time of such transaction would have a
market value of two times the Purchase Price.
If (i) a person acquires beneficial ownership of 20% or more
of the Common Stock, (ii) the Company is the surviving
corporation in a merger with an Acquiring Person and the Common
Stock remains outstanding and unchanged, or (iii) an Acquiring
Person engages in a "SELF-DEALING" transaction specified in the
Rights Agreement, the Rights will "FLIP IN" and entitle each
holder of a Right, except as provided below, to purchase, upon
exercise at the then-current Purchase Price, that number of
C-2
<PAGE>
shares of Common Stock having a market value of two times the
Purchase Price.
Any "flip over" event or "flip in" event is a "TRIGGERING
EVENT."
Any Rights beneficially owned at any time on or after the
Separation Date by an Acquiring Person or an affiliate or
associate of an Acquiring Person (whether or not such ownership
is subsequently transferred) will become null and void upon the
occurrence of the earlier of the Board of Directors decision to
exchange the rights and a Triggering Event, and any holder of
such Rights will have no right to exercise such Rights.
Under certain circumstances, the disinterested directors can
approve a transaction with a specific shareholder and freeze the
Rights in connection with that specific transaction.
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price. Holders will
have no right to receive fractional shares of Preferred Stock
(other than fractions which are integral multiples of one one-
hundredth of a share of Preferred Stock) upon the exercise of
Rights. In lieu of such fractional shares, an adjustment in cash
may be made based on the market price of the Preferred Stock on
the last trading date prior to the date of exercise.
The number of outstanding Rights and the number of one one-
hundredths of a share of Preferred Stock issuable upon exercise
of each Right and the Purchase Price are also subject to
adjustment in the event of a stock split of the Common Stock or
distributions, subdivisions, consolidations or combinations of
the Common Stock occurring, in any such case, prior to the
Separation Date.
At any time prior to the earlier of (i) the closing of
business on the tenth day following the time that it becomes
public that an Acquiring Person has become such (with the
possibility for the Board of Directors to extend this time for an
additional 10 days) and (ii) the Expiration Date, the Company may
redeem the Rights in whole, but not in part, at a price of $0.01
per Right. Immediately upon the action of the Company's Board of
Directors electing to redeem the Rights, the right to exercise
C-3
<PAGE>
the Rights will terminate and the only right of the holders of
Rights thereafter will be to receive the applicable redemption
price.
At any time any person becomes an Acquiring Person and prior
to such time as such person, together with its affiliates becomes
the beneficial owner of at least 50% of the Company's outstanding
Common Stock, the Company may, provided that all necessary
regulatory approvals have been obtained, exchange the Rights
(other than Rights owned by such Acquiring Person which become
null and void), in whole or in part, at a ratio of one share of
Common Stock per Right, subject to adjustment.
Until a Right is exercised, the holder has no rights as a
shareholder of the Company, including, without limitation, the
right to vote or to receive dividends or distributions.
The Company may, without the approval of any holder of the
Rights, but only if at that time the Board of Directors consists
of a majority of disinterested directors, supplement or amend any
provision of the Rights Agreement, except the redemption window,
the Purchase Price or the redemption price.
Preferred Stock purchasable upon exercise of the Rights will
not be redeemable. Each share of Preferred Stock will be
entitled to a minimum preferential quarterly dividend payment of
$25.00 per share but will be entitled to an aggregate dividend of
100 times the dividend declared per share of Common Stock, if it
is greater. In the event of liquidation, the holders of the
Preferred Stock will be entitled to a minimum preferential
liquidation payment of $100.00 per share, but will be entitled to
an aggregate payment of 100 times the payment made per share of
Common Stock, if it is greater. In the event of any merger or
other business combination in which Common Stock is exchanged,
each share of Preferred Stock will be entitled to receive 100
times the amount received per share of Common Stock. These
rights are protected by customary antidilution provisions.
Because of the nature of the Preferred Stock's dividend,
liquidation and voting rights, the value of the one one-hundredth
of a share of Preferred Stock purchasable upon exercise of each
Right is intended to approximate the value of one share of Common
Stock.
C-4
<PAGE>
The Rights have certain anti-takeover effects. The Rights may
cause substantial dilution to a person or group that attempts to
acquire the Company on terms not approved by the Company's Board
of Directors, except pursuant to an offer conditioned upon a
substantial number of Rights being acquired. The Rights should
not interfere with any merger or other business combination
approved by the Board of Directors prior to the time a person or
group has acquired beneficial ownership of 15% or more of the
Common Stock, because until such time, the Rights may be redeemed
by the Company at $0.01 per Right.
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission and is available free of
charge from the Company. This summary description of the Rights
does not purport to be complete and is qualified in its entirety
by reference to the Rights Agreement, which is hereby
incorporated herein by reference.
C-5
