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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20569
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FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
PREMIER PARKS INC.
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(Exact name of registrant as specified in its charter)
DELAWARE 73-6137714
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(State of Incorporation or Organization) (IRS Employer
Identification No.)
11501 NORTHEAST EXPRESSWAY, OKLAHOMA CITY, OK 73131
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(Address of principal executive offices) (Zip Code)
If this form relates to the registration of a class of securities pursuant to
Section 12(b) of the Exchange Act and is effective pursuant to General
Instruction A.(c), please check the following box. /X/
If this form relates to the registration of a class of securities pursuant to
Section 12(g) of the Exchange Act and is effective pursuant to General
Instruction A.(d), please check the following box. / /
Securities Act registration statement file number to which this form relates:
_____________________
(If applicable)
Securities to be registered pursuant to Section 12(b) of the Act:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH
TO BE SO REGISTERED EACH CLASS IS TO BE REGISTERED
PREFERRED STOCK PURCHASE RIGHTS NEW YORK STOCK EXCHANGE
Securities to be registered pursuant to Section 12(g) of the Act:
NONE
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(Title of Class)
Page 1 of ___ Pages
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Item 1. DESCRIPTION OF SECURITIES TO BE REGISTERED.
The Board of Directors of the Company has declared a dividend of one
Preferred Stock Purchase Right (the "Right(s)") for each outstanding share of
Common Stock, par value $0.05 per share (the "Common Stock"), of the Company.
The dividend is payable as of January 12, 1998 to stockholders of record on that
date. Each Right entitles the registered holder to purchase from the Company
one one-hundredth (1/100) of a share of a new series of preferred shares of the
Company, designated as Series A Junior Preferred Stock ("Preferred Stock"), at a
price of $250.00 per one one-hundredth (1/100) of a share (the "Exercise
Price"), subject to certain adjustments. The description and terms of the
Rights are set forth in a Rights Agreement (the "Rights Agreement") between the
Company and Bank One Trust Company, N.A., as Rights Agent ("Rights Agent"),
dated as of January 12, 1998.
Initially the Rights will not be exercisable, certificates will not be
sent to stockholders, and the Rights will automatically trade with the Common
Stock.
The Rights, unless earlier redeemed by the Board of Directors, become
exercisable upon the close of business on the day (the "Distribution Date")
which is the earlier of (i) the tenth day following a public announcement that a
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person or group of affiliated or associated persons, with certain exceptions set
forth below, has acquired beneficial ownership of 15% or more of the outstanding
voting stock of the Company (an "Acquiring Person") and (ii) the tenth business
day (or such later date as may be determined by the Board of Directors prior to
such time as any person or group of affiliated or associated persons becomes an
Acquiring Person) after the date of the commencement or announcement of a
person's or group's intention to commence a tender or exchange offer the
consummation of which would result in the ownership of 15% or more of the
Company's outstanding voting stock (even if no shares are actually purchased
pursuant to such offer); prior thereto, the Rights would not be exercisable,
would not be represented by a separate certificate, and would not be
transferable apart from the Company's Common Stock, but will instead be
evidenced, with respect to any of the Common Stock certificates outstanding as
of January 12, 1998, by such Common Stock certificate with a copy of this
Summary of Rights attached thereto. An Acquiring Person does not include (A)
the Company, (B) any subsidiary of the Company, (C) any employee benefit plan or
employee stock plan of the Company or of any subsidiary of the Company, or any
trust or other entity organized, appointed, established or holding Common Stock
for or
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pursuant to the terms of any such plan or (D) any person or group whose
ownership of 15% or more of the shares of voting stock of the Company then
outstanding results solely from (i) any action or transaction or transactions
approved by the Board of Directors before such person or group became an
Acquiring Person or (ii) a reduction in the number of issued and outstanding
shares of voting stock of the Company pursuant to a transaction or transactions
approved by the Board of Directors (provided that any person or group that does
not become an Acquiring Person by reason of clause (i) or (ii) above shall
become an Acquiring Person upon acquisition of an additional 1% of the Company's
voting stock unless such acquisition of additional voting stock will not result
in such person or group becoming an Acquiring Person by reason of such clause
(i) or (ii)).
Until the Distribution Date (or earlier redemption or expiration of
the Rights), new Common Stock certificates issued after January 12, 1998 will
contain a legend incorporating the Rights Agreement by reference. Until the
Distribution Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any of the Company's Common Stock certificates
outstanding as of January 12, 1998 with or without a copy of the Summary of
Rights attached, will also constitute the transfer of the
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Rights associated with the Common Stock represented by such certificate. As
soon as practicable following the Distribution Date, separate certificates
evidencing the Rights ("Right Certificates") will be mailed to holders of record
of the Company's Common Stock as of the close of business on the Distribution
Date and such separate certificates alone will evidence the Rights from and
after the Distribution Date.
The Rights are not exercisable until the Distribution Date. The
Rights will expire at the close of business on January 12, 2008, unless earlier
redeemed by the Company as described below.
The Preferred Stock is non-redeemable and, unless otherwise provided
in connection with the creation of a subsequent series of preferred stock,
subordinate to any other series of the Company's preferred stock. The Preferred
Stock may not be issued except upon exercise of Rights. Each share of Preferred
Stock will be entitled to receive when, as and if declared, a quarterly dividend
in an amount equal to the greater of $1.00 per share and 100 times the cash
dividends declared on the Company's Common Stock. In addition, the Preferred
Stock is entitled to 100 times any non-cash dividends (other than dividends
payable in equity securities) declared on the Common Stock, in like
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kind. In the event of liquidation, the holders of Preferred Stock will be
entitled to receive for each share, a liquidation payment in an amount equal to
the greater of $25,000.00 or 100 times the payment made per share of Common
Stock. Each share of Preferred Stock will have 100 votes, voting together with
the Common Stock. In the event of any merger, consolidation or other
transaction in which Common Stock is exchanged, each share of Preferred Stock
will be entitled to receive 100 times the amount received per share of Common
Stock. The rights of Preferred Stock as to dividends, liquidation and voting
are protected by anti-dilution provisions.
The number of shares of Preferred Stock issuable upon exercise of the
Rights is subject to certain adjustments from time to time in the event of a
stock dividend on, or a subdivision or combination of, the Common Stock. The
Exercise Price for the Rights is subject to adjustment in the event of
extraordinary distributions of cash or other property to holders of Common
Stock.
Unless the Rights are earlier redeemed or the transaction is approved
by the Board of Directors, in the event that, after the time that a Person
becomes an Acquiring Person, the Company were to be acquired in a merger or
other business combination (in which any shares of
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the Company's Common Stock are changed into or exchanged for other securities or
assets) or more than 50% of the assets or earning power of the Company and its
subsidiaries (taken as a whole) were to be sold or transferred in one or a
series of related transactions, the Rights Agreement provides that proper
provision will be made so that each holder of record of a Right will from and
after such date have the right to receive, upon payment of the Exercise Price,
that number of shares of common stock of the acquiring company having a market
value at the time of such transaction equal to two times the Exercise Price. In
addition, unless the Rights are earlier redeemed, if a person or group (with
certain exceptions) becomes the beneficial owner of 15% or more of the Company's
voting stock, the Rights Agreement provides that proper provision will be made
so that each holder of record of a Right, other than the Acquiring Person (whose
Rights will thereupon become null and void), will thereafter have the right to
receive, upon payment of the Exercise Price, that number of shares of the
Company's Preferred Stock having a market value at the time of the transaction
equal to two times the Exercise Price (such market value to be determined with
reference to the market value of the Company's Common Stock as provided in the
Rights Agreement). The Rights Agreement
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also grants the Board of Directors the option, after any person or group
acquires beneficial ownership of 15% or more of the voting stock but before
there has been a 50% acquisition, to exchange one share of common stock for each
then valid right (which would exclude rights held by the Acquiring Person that
have become void).
Fractions of shares of Preferred Stock (other than fractions that are
integral multiples of one one-hundredth (1/100) of a share) may, at the election
of the Company, be evidenced by depositary receipts. The Company may also issue
cash in lieu of fractional shares which are not integral multiples of one
one-hundredth (1/100) of a share.
At any time on or prior to the close of business on the tenth day
after the time that a person has become an Acquiring Person (or such later date
as a majority of the Board of Directors and a majority of the Continuing
Directors (as defined in the Rights Agreement) may determine), the Company may
redeem the Rights in whole, but not in part, at a price of $.01 per Right
("Redemption Price"). The Rights may be redeemed after the time that any Person
has become and Acquiring Person only if approved by a majority of the Continuing
Directors. Immediately upon the effective time of the action of the Board of
Directors of the Company authorizing redemption of the Rights, the right
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to exercise the Rights will terminate and the only right of the holders of the
Rights will be to receive the Redemption Price.
For as long as the Rights are then redeemable, the Company may, except
with respect to the redemption price or date of expiration of the Rights, amend
the Rights in any manner, including an amendment to extend the time period in
which the Rights may be redeemed. At any time when the Rights are not then
redeemable, the Company may amend the Rights in any manner that does not
materially adversely affect the interests of holders of the Rights as such.
Amendments to the Rights Agreement from and after the time that any Person
becomes an Acquiring Person requires the approval of a majority of the
Continuing Directors (as provided in the Rights Agreement).
Until a Right is exercised, the holder, as such, will have no rights
as a stockholder of the Company, including, without limitation, the right to
vote or to receive dividends.
As of December 15, 1997, there were 18,872,339 shares of Common
Stock issued and outstanding (and 1,765,038 shares reserved for issuance
under the Company's existing stock option plans). 206,400 shares of
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Preferred Stock have been reserved for issuance upon exercise of the Rights.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group who attempts to acquire the Company on
terms not approved by the Company's Board of Directors. The Rights should not
interfere with any merger or other business combination approved by the Board
since they may be redeemed by the Company at $.01 per Right at any time until
the close of business on the tenth day (or such later date as described above)
after a person or group has obtained beneficial ownership of 15% or more of the
voting stock.
The form of Rights Agreement between the Company and Bank One Trust
Company, N.A. as rights agent, specifying the terms of the Rights, which
includes as Exhibit A the form of Summary of Rights to Purchase Series A Junior
Preferred Stock, as Exhibit B the form of Right Certificate and as Exhibit C the
form of Certificate of Designations of the Company setting forth the terms of
the Preferred Stock are attached hereto as exhibits and incorporated herein by
reference. The foregoing description of the Rights is qualified by reference to
such exhibits.
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Item 2. EXHIBITS.
1. Rights Agreement dated as of January 12, 1998 between Premier
Parks, Inc. and Bank One Trust Company N.A., as Rights Agent. The
Rights Agreement includes as Exhibit B the form of Right
Certificate and as Exhibit C the form of Certificate of
Designations.
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SIGNATURES
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 hereunto duly authorized.
By: /s/ James F. Dannhauser
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Name: James F. Dannhauser
Title: Chief Financial Officer
January 8, 1998
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EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
1. Rights Agreement dated as of January 12, 1998 between Premier
Parks, Inc. and Bank One Trust Company N.A., as Rights Agent. The
Rights Agreement includes as Exhibit B the form of Right
Certificate and as Exhibit C the form of Certificate of
Designations.
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RIGHTS AGREEMENT
by and between
PREMIER PARKS INC.
and
BANK ONE TRUST COMPANY, N.A.
as Rights Agent
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Dated as of
January 12, 1998
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TABLE OF CONTENTS
SECTION PAGE
1. Certain Definitions.................................................... 2
2. Appointment of Rights Agent............................................ 12
3. Issuance of Right Certificates......................................... 13
4. Form of Right Certificates............................................. 16
5. Countersignature and Registration...................................... 17
6. Transfer, Split Up, Combination and Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen Right Certificates................ 18
7. Exercise of Rights; Exercise Price; Expiration Date of Rights.......... 20
8. Cancellation and Destruction of Right Certificates..................... 25
9. Reservation and Availability of Shares of Preferred Stock.............. 26
10. Preferred Stock Record Date............................................ 29
11. Adjustment of Exercise Price or Number of Shares....................... 30
12. Certification of Adjusted Exercise Price or Number of Shares........... 39
13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power... 40
14. Fractional Rights and Fractional Shares................................ 48
15. Rights of Action....................................................... 49
16. Agreement of Right Holders............................................. 50
17. Right Certificate Holder Not Deemed a Stockholder...................... 51
18. Concerning the Rights Agent............................................ 52
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SECTION PAGE
19. Merger or Consolidation of, or Change in Name of, the Rights Agent..... 53
20. Duties of Rights Agent................................................. 55
21. Change of Rights Agent................................................. 58
22. Issuance of New Right Certificates..................................... 60
23. Redemption............................................................. 61
24. Notice of Proposed Actions............................................. 63
25. Notices................................................................ 65
26. Supplements and Amendments............................................. 66
27. Exchange............................................................... 67
28. Successors............................................................. 70
29. Benefits of this Rights Agreement...................................... 70
30. Delaware Contract...................................................... 70
31. Counterparts........................................................... 70
32. Descriptive Headings................................................... 71
33. Severability........................................................... 71
Exhibit A -- Summary of Rights
Exhibit B -- Form of Right Certificate
Exhibit C -- Form of Certificate of Designations, Preferences and
Rights of Series A Junior Preferred Stock
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RIGHTS AGREEMENT
Agreement, dated as of January 12, 1998, by and between Premier
Parks Inc., a Delaware corporation (the "Company"), and Bank One Trust Company,
N.A., a national banking association (the "Rights Agent").
W I T N E S S E T H :
WHEREAS, on December 10, 1997, the Board of Directors of the
Company authorized the issuance of, and declared a dividend payable in, one
right (a "Right") for each share of Common Stock, $0.05 par value per share, of
the Company outstanding as of the close of business on January 12, 1998 (the
"Record Date"), each such Right representing the right to purchase one
one-hundredth of a share of Series A Junior Preferred Stock of the Company
("Preferred Stock") having the rights and preferences set forth in the form of
Certificate of Designations, Preferences and Rights attached hereto as Exhibit C
authorized by the Board of Directors on December 10, 1997, upon the terms and
subject to the conditions hereinafter set forth; and
WHEREAS, the Board of Directors of the Company further authorized
the issuance of one Right (subject to adjustment) with respect to each share of
Common Stock which may be issued between the Record Date and the earlier to
occur of the Distribution
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Date, the Expiration Date or the Final Expiration Date (as such terms are
hereinafter defined);
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 shall 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 such term is hereinafter defined) and Associates
(as such term is hereinafter defined) of such Person, shall be
the Beneficial Owner (as such term is hereinafter defined) of 15%
or more of the Voting Stock of the Company then outstanding;
provided, that, an Acquiring Person shall not include (i) an
Exempt Person (as such term is hereinafter defined) or (ii) any
Person, together with all Affiliates and Associates of such
Person, who or which would be an Acquiring Person solely by
reason of (A) being the Beneficial Owner of shares of Voting
Stock of the Company, the Beneficial Ownership of which was
acquired by such Person pursuant to any action or transaction or
series of related actions or transactions approved by the Board
of Directors before such
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Person otherwise became an Acquiring Person or (B) a reduction in
the number of issued and outstanding shares of Voting Stock of
the Company pursuant to a transaction or a series of related
transactions approved by the Board of Directors of the Company;
PROVIDED, FURTHER, that in the event such Person described in
this clause (ii) does not become an Acquiring Person by reason of
subclause (A) or (B) of this clause (ii), such Person nonetheless
shall become an Acquiring Person in the event such Person
thereafter acquires Beneficial Ownership of an additional 1% of
the Voting Stock of the Company, unless the acquisition of such
additional Voting Stock would not result in such Person becoming
an Acquiring Person by reason of subclause (A) or (B) of this
clause (ii). Notwithstanding the foregoing, if the Board of
Directors of the Company determines in good faith (but only if at
the time of such determination by the Board of Directors there
are then in office not less than two Continuing Directors and
such action is approved by a majority of the Continuing Directors
then in office) that a Person who would otherwise be an
"Acquiring Person" as defined pursuant to the foregoing
provisions of this paragraph (a) has become such inadvertently,
and such Person divests as
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promptly as practicable (as determined in good faith by the Board
of Directors) a sufficient number of shares of Common Stock so
that such Person would no longer be an "Acquiring Person" as
defined pursuant to the foregoing provisions of this paragraph
(a), then such Person shall not be deemed an "Acquiring Person"
for any purposes of this Rights Agreement.
(b) "Affiliate" shall have the meaning ascribed to such
term in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as amended ("Exchange Act"), as
in effect on the date of this Rights Agreement.
(c) "Associate" of a Person (as such term is hereinafter
defined) shall mean (i) with respect to a corporation, any
officer or director thereof or of any Subsidiary (as such term is
hereinafter defined) thereof, or any Beneficial Owner (as such
term is hereinafter defined) of 10% or more of any class of
equity security thereof, (ii) with respect to an association, any
officer or director thereof or of a Subsidiary thereof, (iii)
with respect to a partnership, any general partner thereof or any
limited partner thereof who is, directly or indirectly, the
Beneficial Owner of a 10% ownership interest therein, (iv) with
respect to
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a business trust, any officer or trustee thereof or of any
Subsidiary thereof, (v) with respect to any other trust or an
estate, any trustee, executor or similar fiduciary or any Person
who has a 15% or greater interest as a beneficiary in the income
from or principal of such trust or estate, (vi) with respect to a
natural person, any relative or spouse of such person, or any
relative of such spouse, who has the same home as such person,
and (vii) any Affiliate of such Person.
(d) A person shall be deemed the "Beneficial Owner" of, or to
"Beneficially Own", any securities (and correlative terms shall
have correlative meanings):
(i) which such Person or any of such Person's
Affiliates or Associates beneficially owns, directly or
indirectly, for purposes of Section 13(d) of the Exchange
Act and Regulations 13D and 13G thereunder (or any
comparable or successor law or regulation), in each case
as in effect on the date hereof; or
(ii) which such Person or any of such Person's
Affiliates or Associates has (A) the right to acquire
(whether such right is exercisable immediately or only
after the passage of time
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or the fulfillment of a condition or both) pursuant to
any agreement, arrangement or understanding, or upon the
exercise of conversion rights, exchange rights, other
rights (other than these Rights), warrants or options, or
otherwise; PROVIDED, HOWEVER, that a Person shall not be
deemed the "Beneficial Owner" of, or to "Beneficially
Own", securities tendered pursuant to a tender or
exchange offer made by such Person or any of such
Person's Affiliates or Associates until such tendered
securities are accepted for purchase or exchange or (B)
the right to vote, alone or in concert with others,
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 securities if the agreement,
arrangement or understanding to vote such security (1)
arises solely from a revocable proxy or consent given in
response to a proxy or consent solicitation made pursuant
to, and in accordance with, the applicable rules and
regulations under the Exchange Act and (2) is not at the
time reportable by such Person on a Schedule 13D report
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under the Exchange Act (or any comparable or successor
report), other than by reference to a proxy or consent
solicitation being conducted by such Person; or
(iii) which are beneficially owned, directly or
indirectly, by any other Person with which such Person or
any of such Person's Affiliates or Associates has any
agreement, arrangement or understanding (whether or not in
writing) for the purpose of acquiring, holding, voting
(except as described in clause (B) of subparagraph (ii) of
this paragraph (d)) or disposing of any securities of the
Company; PROVIDED, HOWEVER, that for purposes of
determining Beneficial Ownership of securities under this
Rights Agreement, officers and directors of the Company
solely by reason of their status as such shall not
constitute a group (notwithstanding that they may be
Associates of one another or may be deemed to constitute a
group for purposes of Section 13(d) the Exchange Act) and
shall not be deemed to own shares owned by another officer
or director of the Company.
Notwithstanding anything in this paragraph (d) to
the contrary, a Person engaged in the business of
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underwriting securities shall not be deemed the "Beneficial
Owner" of, or to "Beneficially Own," any securities acquired in
good faith in a firm commitment underwriting until the expiration
of forty days after the date of such acquisition.
(e) "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in the
State of [New York] are authorized or obligated by law or
executive order to close.
(f) "Close of Business" on any given date shall mean 5:00
P.M., Oklahoma City, Oklahoma time, on such date; PROVIDED,
HOWEVER, that if such date is not a Business Day it shall mean
5:00 P.M., Oklahoma City, Oklahoma time, on the next succeeding
Business Day.
(g) "Common Stock" when used with reference to the Company
shall collectively mean the Common Stock, $0.05 par value, of the
Company. "Common Stock" when used with reference to any Person
other than the Company which shall be organized in corporate form
shall mean the capital stock or other equity security with the
greatest per share voting power of such Person. "Common Stock"
when used with reference to any Person other than the Company
which shall not be organized in corporate form shall mean units
of beneficial
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interest which shall represent the right to participate in
profits, losses, deductions and credits of such Person and which
shall be entitled to exercise the greatest voting power per unit
of such Person.
(h) "Continuing Director" shall mean any member of the
Board of Directors, while such person is a member of the Board of
Directors, who is not an Acquiring Person, or an Affiliate or
Associate of an Acquiring Person, or a representative or nominee
of an Acquiring Person or of any such Affiliate or Associate, and
who either (i) was a member of the Board of Directors prior to
the time that any Person became an Acquiring Person (ii)
subsequently became a member of the Board of Directors, and whose
nomination for election or election to the Board of Directors was
recommended or approved by a majority of the Continuing Directors
then on the Board of Directors.
(i) "Distribution Date" shall have the meaning set
forth in Section 3(b) hereof.
(j) "Exchange Act" shall have the meaning set forth in
Section 1(b) hereof.
(k) "Exempt Person" shall mean (i) the Company, (ii) any
Subsidiary of the Company or (iii) any employee benefit plan or
employee stock plan of the
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Company or any Subsidiary of the Company, or any trust or other
entity organized, appointed, established or holding Common Stock
for or pursuant to the terms of any such plan.
(l) "Exercise Price" shall have the meaning set forth in
Sections 4 and 7(b) hereof.
(m) "Expiration Date" shall have the meaning set forth in
Section 7(a) hereof.
(n) "Fair Market Value" of any property shall mean the
fair market value of such property as determined in accordance
with Section 11(b) hereof.
(o) "Final Expiration Date" shall have the meaning set
forth in Section 7(a) hereof.
(p) "Person" shall mean any individual, firm, corporation
or other entity.
(q) "Principal Party" shall have the meaning set forth in
Section 13(b) hereof.
(r) "Redemption Price" shall have the meaning set forth in
Section 23(a) hereof.
(s) "Right Certificate" shall have the meaning set forth
in Section 3(d) hereof.
(t) "Stock Acquisition Date" shall mean the first date on
which there shall be a public announcement by the Company or an
Acquiring Person that an Acquiring
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Person has become such (which, for purposes of this definition,
shall include, without limitation, a report filed pursuant to
Section 13(d) of the Exchange Act) or such earlier date as a
majority of the Continuing Directors shall become aware of the
existence of an Acquiring Person.
(u) "Subsidiary" of a Person shall mean any corporation or
other entity of which securities or other ownership interests
having voting power sufficient to elect a majority of the board
of directors or other persons performing similar functions are
beneficially owned, directly or indirectly, by such Person or by
any corporation or other entity that is otherwise controlled by
such Person.
(v) "Summary of Rights" shall have the meaning set forth
in Section 3(a) hereof.
(w) "Trading Day" shall have the meaning set forth in
Section 11(b) hereof.
(x) "Transfer Tax" shall mean any tax or charge, including
any documentary stamp tax, imposed or collected by any
governmental or regulatory authority in respect of any transfer
of any security, instrument or right, including Rights, shares of
Common Stock and shares of Preferred Stock.
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(y) "Voting Stock" shall mean (i) the Common Stock of the
Company and (ii) any other shares of capital stock of the Company
entitled to vote generally in the election of directors or
entitled to vote together with the Common Stock in respect of any
merger, consolidation, sale of all or substantially all of the
Company's assets, liquidation, dissolution or winding up. For
purposes of this Agreement, a stated percentage of the Voting
Stock shall mean a number of shares of the Voting Stock as shall
equal in voting power that stated percentage of the total voting
power of the then outstanding shares of Voting Stock in the
election of a majority of the Board of Directors or in respect of
any merger, consolidation, sale of all or substantially all of
the Company's assets, liquidation, dissolution or winding up.
Any determination required to be made by the Board of Directors of the
Company for purposes of applying the definitions contained in this Section 1
shall be made by the Board of Directors in its good faith judgment, which
determination shall be binding on the Rights Agent and the holders of the
Rights.
Section 2. APPOINTMENT OF RIGHTS AGENT. The Company hereby
appoints the Rights Agent to act as agent for the Company and the holders of the
Rights in accordance with the terms and
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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. ISSUANCE OF RIGHT CERTIFICATES.
(a) On the Record Date (or as soon as practicable thereafter),
the Company or the Rights Agent shall send a copy of a Summary of Rights, in
substantially the form attached hereto as Exhibit A (the "Summary of Rights"),
by first class mail, postage prepaid, 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.
(b) Until the close of business on the day which is the earlier
of (i) the tenth day after the Stock Acquisition Date or (ii) the tenth business
day (or such later date as may be determined by action of the Board of Directors
prior to such time as any Person becomes an Acquiring Person) after the date of
the commencement by any Person (other than an Exempt Person) of, or the first
public announcement of the intent of any Person (other than an Exempt Person) to
commence, a tender or exchange offer upon the successful consummation of which
such Person, together with its Affiliates and Associates, would be the
Beneficial Owner of 15% or more of the then outstanding shares of Voting Stock
of the Company (irrespective of whether any shares are actually purchased
pursuant to any such offer) (the earlier of such dates
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being herein referred to as the "Distribution Date"), (x) the Rights shall be
evidenced by the certificates for Common Stock registered in the name of the
holders of Common Stock (together with, in the case of certificates for Common
Stock outstanding as of the Record Date, the Summary of Rights) and not by
separate Right certificates and the record holders of such certificates for
Common Stock shall be the record holders of the Rights represented thereby and
(y) each Right shall be transferable only simultaneously and together with the
transfer of a share of Common Stock (subject to adjustment as hereinafter
provided). Until the Distribution Date (or, if earlier, the Expiration Date or
Final Expiration Date), the surrender for transfer of any certificate for Common
Stock shall constitute the surrender for transfer of the Right or Rights
associated with the Common Stock evidenced thereby, whether or not accompanied
by a copy of the Summary of Rights.
(c) Rights shall be issued in respect of all shares of Common
Stock that become outstanding after the Record Date but prior to the earlier of
the Distribution Date, the Expiration Date or the Final Expiration Date and, in
certain circumstances provided in Section 22 hereof, may be issued in respect of
shares of Common Stock that become outstanding after the Distribution Date.
Certificates for Common Stock (including, without limitation, certificates
issued upon original issuance, disposition
14
<PAGE>
from the Company's treasury or transfer or exchange of Common Stock) after the
Record Date but prior to the earliest of the Distribution Date, the Expiration
Date, or the Final Expiration Date (or, in certain circumstances as provided in
Section 22 hereof, after the Distribution Date) shall have impressed, printed,
written or stamped thereon or otherwise affixed thereto the following legend:
This certificate also evidences and entitles the holder
hereof to the same number of Rights (subject to adjustment) as the
number of shares of Common Stock represented by this certificate, such
Rights being on the terms provided under the Rights Agreement between
Premier Parks Inc. and Bank One Trust Company, N.A., (the "Rights
Agent"), dated as of January 12, 1998, as it may be amended from time to
time (the "Rights Agreement"), the terms of which are incorporated
herein by reference and a copy of which is on file at the principal
executive offices of Premier Parks Inc. Under certain circumstances, as
set forth in the Rights Agreement, such Rights shall be evidenced by
separate certificates and shall no longer be evidenced by this
certificate. Premier Parks Inc. shall mail to the registered holder of
this certificate a copy of the Rights Agreement without charge within
five days after receipt of a written request therefor. UNDER CERTAIN
CIRCUMSTANCES AS PROVIDED IN SECTION 7(E) OF THE RIGHTS AGREEMENT,
RIGHTS ISSUED TO OR BENEFICIALLY OWNED BY ACQUIRING PERSONS OR THEIR
AFFILIATES OR ASSOCIATES (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS SHALL BE NULL AND
VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.
(d) As soon as practicable after the Distribution Date, the
Company will prepare and execute, the Rights Agent will countersign, and the
Company will send or cause to be sent (and the Rights Agent will, if requested,
send), by first class mail, postage prepaid, to each record holder of the Common
Stock as of
15
<PAGE>
the close of business on the Distribution Date, as shown by the records of the
Company, at the address of such holder shown on such records, a certificate in
the form provided by Section 4 hereof (a "Right Certificate"), evidencing one
Right (subject to adjustment as provided herein) for each share of Common Stock
so held. As of and after the Distribution Date, the Rights shall be evidenced
solely by Right Certificates and may be transferred by the transfer of the Right
Certificate as permitted hereby, separately and apart from any transfer of one
or more shares of Common Stock.
Section 4. FORM OF RIGHT CERTIFICATES. The Right Certificates
(and the forms of election to purchase shares, certificate and assignment to be
printed on the reverse thereof), when, as and if issued, shall be substantially
in the form set forth in Exhibit B hereto and may have such marks of
identification or designation and such legends, summaries or endorsements
printed thereon as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock
exchange on which the Common Stock or the Rights may from time to time be listed
or as the Company may deem appropriate to conform to usage or otherwise and as
are not inconsistent with the provisions of this Rights Agreement. Subject to
the provisions of Section 22 hereof, Right Certificates evidencing Rights
whenever issued, (i) shall be dated as of the
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date of issuance of the Rights they represent and (ii) subject to adjustment
from time to time as provided herein, on their face shall entitle the holders
thereof to purchase such number of shares (including fractional shares which are
integral multiples of one-hundredth of a share) of Preferred Stock as shall be
set forth therein at the price payable upon exercise of a Right provided by
Section 7(b) hereof as the same may from time to time be adjusted as provided
herein (the "Exercise Price").
Section 5. COUNTERSIGNATURE AND REGISTRATION.
(a) Each Right Certificate shall be executed on behalf of the
Company by its Chairman of the Board, President or any Vice President, either
manually or by facsimile signature, and 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 Right
Certificate shall be countersigned by the Rights Agent either manually or by
facsimile signature and shall not be valid for any purpose unless so
countersigned. In case any officer of the Company who shall have signed any
Right Certificate shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery of the
certificate by the Company, such Right Certificate, nevertheless, may be
countersigned by the Rights Agent and issued and delivered with the same force
and effect as though the person who
17
<PAGE>
signed such Right Certificates had not ceased to be such officer of the Company.
Any Right Certificate may be signed on behalf of the Company by any person who,
on the date of the execution of such Right Certificate, shall be a proper
officer of the Company to sign such Right Certificate, although at the date of
the execution of this Rights Agreement any such person was not such an officer.
(b) Following the Distribution Date, the Rights Agent will keep
or cause to be kept, at its principal office or one or more offices designated
as the appropriate place for surrender of Right Certificates upon exercise or
transfer, and in such other locations as may be required by law, books for
registration and transfer of the Right Certificates issued hereunder. Such books
shall show the names and addresses of the respective holders of the Right
Certificates, the number of Rights evidenced on its face by each of the Right
Certificates and the date of each of the Right Certificates.
Section 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF
RIGHT CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHT CERTIFICATES.
(a) Subject to the provisions of Section 7(e), 7(f) and 14
hereof, at any time after the Close of Business on the Distribution Date, and at
or prior to the Close of Business on the earlier of the Expiration Date or the
Final Expiration Date,
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<PAGE>
any Right Certificate, may be (i) transferred or (ii) split up, combined or
exchanged for one or more other Right Certificates, entitling the registered
holder to purchase a like number of shares of Preferred Stock as the Right
Certificate or Rights Certificates surrendered then entitled such holder to
purchase. Any registered holder desiring to transfer any Right Certificate shall
surrender the Right Certificate at the office of the Rights Agent designated for
the surrender of Right Certificates with the form of certificate and assignment
on the reverse side thereof duly endorsed (or enclosed with such Right
Certificate a written instrument of transfer in form satisfactory to the Company
and the Rights Agent), duly executed by the registered holder thereof or his
attorney duly authorized in writing, and with such signature duly guaranteed.
Any registered holder desiring to split up, combine or exchange any Right
Certificate shall make such request in writing delivered to the Rights Agent,
and shall surrender the Right Certificate to be split up, combined or exchanged
at the office of the Rights Agent designated therefor. Thereupon, the Rights
Agent shall countersign and deliver to the person entitled thereto a Right
Certificate or Right Certificates, as the case may be, as so requested. The
Company may require payment of a sum sufficient to cover any Transfer Tax that
may be imposed in connection with any transfer, split up, combination or
exchange of any Right Certificates.
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<PAGE>
(b) Subject to the provisions of Section 7(e), 7(f) and 14
hereof, upon receipt by the Company and the Rights Agent of evidence reasonably
satisfactory to them of the loss, theft, destruction or mutilation of a Right
Certificate, and, in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to them and, if requested by the Company,
reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, or upon surrender to the Rights Agent and cancellation of
the Right Certificate if mutilated, the Company shall issue and deliver a new
Right Certificate of like tenor to the Rights Agent for delivery to the
registered owner in lieu of the Right Certificate so lost, stolen, destroyed or
mutilated.
Section 7. EXERCISE OF RIGHTS; EXERCISE PRICE; EXPIRATION DATE OF
RIGHTS.
(a) The Rights shall not be exercisable until, and shall become
exercisable on, the Distribution Date (unless otherwise provided herein,
including, without limitation, the restrictions on exercisability set forth in
Section 7(e) and 23(a) hereof). Except as otherwise provided herein, the Rights
may be exercised, in whole or in part, at any time commencing with the
Distribution Date upon surrender of the Right Certificate, with the form of
election to purchase and certificate on the reverse side thereof duly executed
(with signatures duly guaranteed), to
20
<PAGE>
the Rights Agent at the principal office of the Rights Agent in Oklahoma City,
Oklahoma, together with payment of the Exercise Price for each Right exercised,
subject to adjustment as hereinafter provided, at or prior to the Close of
Business on the earlier of (i) January 12, 2008 (the "Final Expiration Date") or
(ii) the date on which the Rights are redeemed as provided in Section 23 hereof
(such earlier date being herein referred to as the "Expiration Date").
(b) The Exercise Price shall initially be $250.00 for each one
one-hundredth (1/100) of a share of Preferred Stock issued pursuant to the
exercise of a Right. The Exercise Price and the number of shares of Preferred
Stock or other securities to be acquired upon exercise of a Right shall be
subject to adjustment from time to time as provided in Sections 11 and 13
hereof. The Exercise Price shall be payable in lawful money of the United States
of America, in accordance with paragraph (c) below.
(c) Except as otherwise provided herein, upon receipt of a Right
Certificate representing exercisable Rights with the form of election to
purchase duly executed, accompanied by payment by certified check, cashier's
check, bank draft or money order payable to the Company or the Rights Agent of
the Exercise Price for the shares to be purchased and an amount equal to any
applicable Transfer Tax required to be paid by the holder of the
21
<PAGE>
Right Certificate in accordance with Section 9(e) hereof, the Rights Agent shall
thereupon promptly (i) requisition from any transfer agent of the Preferred
Stock of the Company one or more certificates representing the number of shares
of Preferred Stock to be so purchased, and the Company hereby authorizes and
directs such transfer agent to comply with all such requests, (ii) as provided
in Section 14(b), at the election of the Company, cause depositary receipts to
be issued in lieu of fractional shares of Preferred Stock, (iii) if the election
provided for in the immediately preceding clause (ii) has not been made,
requisition from the Company the amount of cash to be paid in lieu of the
issuance of fractional shares in accordance with Section 14(b) hereof, (iv)
after receipt of such Preferred Stock certificates and, if applicable,
depositary receipts, cause the same to be delivered to or upon the order of the
registered holder of such Right Certificate, registered in such name or names as
may be designated by such holder and (v) when appropriate, after receipt,
promptly deliver such cash to or upon the order of the registered holder of such
Right Certificate; PROVIDED, HOWEVER, that in the case of a purchase of
securities, other than Preferred Stock, pursuant to Section 13 hereof, the
Rights Agent shall promptly take the appropriate actions corresponding in such
case to that referred to in the foregoing clauses (i) through (v) of this
Section 7(c). Notwithstanding the foregoing provisions
22
<PAGE>
of this Section 7(c), the Company may suspend the issuance of shares of
Preferred Stock upon exercise of a Right for a reasonable period, not in excess
of 90 days, during which the Company seeks to register under the Securities Act
of 1933, as amended (the "Act"), and any applicable securities law of any other
jurisdiction, the shares of Preferred Stock to be issued pursuant to the Rights;
PROVIDED, HOWEVER, that nothing contained in this Section 7(c) shall relieve the
Company of its obligations under Section 9(c) hereof.
(d) In case the registered holder of any Right Certificate shall
exercise less than all the Rights evidenced thereby, a new Right Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be issued
by the Rights Agent to the registered holder of such Right Certificate or his
assign, subject to the provisions of Section 14(b) hereof.
(e) Notwithstanding any provision of this Rights Agreement to the
contrary, from and after the time (the "invalidation time") when any Person
first becomes an Acquiring Person, any Rights that are beneficially owned by (x)
such Acquiring Person (or any Associate or Affiliate of such Acquiring Person),
(y) a transferee of such Acquiring Person (or any such Associate or Affiliate)
who becomes a transferee after the invalidation time or (z) a transferee of such
Acquiring Person (or any such Associate or Affiliate) who becomes a transferee
23
<PAGE>
prior to or concurrently with the invalidation time pursuant to either (I) a
transfer from the Acquiring Person to holders of its equity securities or to any
Person with whom it has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (II) a transfer which the Board of Directors
has determined is part of a plan, arrangement or understanding which has the
purpose or effect of avoiding the provisions of this Section 7(e), and
subsequent transferees of such Persons referred to in clause (y) and (z) above,
shall be void without any further action and any holder of such Rights shall
thereafter have no rights whatsoever with respect to such Rights under any
provision of this Rights Agreement. The Company shall use all reasonable efforts
to ensure that the provisions of this Section 7(e) are complied with, but shall
have no liability to any holder of Right Certificates or any other Person as a
result of its failure to make any determination with respect to an Acquiring
Person or its Affiliates, Associates or transferees hereunder. No Right
Certificate shall be issued pursuant to Section 3 hereof that represents Rights
beneficially owned by an Acquiring Person whose Rights would be void pursuant to
the provisions of this Section 7(e) or any Associate or Affiliate thereof; no
Right Certificate shall be issued at any time upon the transfer of any Rights to
an Acquiring Person whose Rights would be void pursuant to the provisions of
this Section 7(e) or
24
<PAGE>
any Associate or Affiliate thereof or to any nominee of such Acquiring Person,
Associate or Affiliate; and any Right Certificate delivered to the Rights Agent
for transfer to an Acquiring Person whose Rights would be void pursuant to the
provisions of this Section 7(e) shall be cancelled.
(f) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder upon the occurrence of any purported
exercise as set forth in this Section 7 unless such registered holder shall have
(i) completed and signed the certificate following the form of election to
purchase set forth on the reverse side of the Right Certificate surrendered for
such exercise and (ii) provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company shall reasonably request.
Section 8. CANCELLATION AND DESTRUCTION OF RIGHT CERTIFICATES.
All Right Certificates surrendered for the purpose of exercise, transfer, split
up, combination or exchange shall, if surrendered to the Company or to any of
its agents, be delivered to the Rights Agent for cancellation or in cancelled
form, or, if surrendered to the Rights Agent, shall be cancelled by it, and no
Right Certificates shall be issued in lieu thereof except as expressly permitted
by any of the provisions of this
25
<PAGE>
Rights Agreement. The Company shall deliver to the Rights Agent for cancellation
and retirement, and the Rights Agent shall cancel and retire, any Right
Certificate purchased or acquired by the Company otherwise than upon the
exercise thereof. The Rights Agent shall deliver all cancelled Right
Certificates to the Company, or shall, at the written request of the Company,
destroy such cancelled Right Certificates, and in such case shall deliver a
certificate of destruction thereof to the Company.
Section 9. RESERVATION AND AVAILABILITY OF SHARES OF PREFERRED
STOCK.
(a) The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued shares of
Preferred Stock or out of authorized and issued shares of Preferred Stock
held in its treasury, such number of shares of Preferred Stock as will from
time to time be sufficient to permit the exercise in full of all outstanding
Rights.
(b) The Company shall use its best efforts to cause, from and
after such time as the Rights become exercisable, all shares of Preferred Stock
issued or reserved for issuance in accordance with this Rights Agreement to be
listed, upon official notice of issuance, upon the principal national securities
exchange, if any, upon which the Common Stock is listed or, if the principal
market for the Common Stock is not on any national
26
<PAGE>
securities exchange, to be eligible for quotation in the National Association of
Securities Dealers' Automated Quotation System or any successor thereto or other
comparable quotation system.
(c) The Company covenants and agrees that it will take all such
action as may be necessary to insure 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 Exercise Price in
respect thereof), be duly and validly authorized and issued and fully paid and
nonassessable shares.
(d) The Company shall use its best efforts to (i) file, as soon
as practicable following the occurrence of the event described in Section
11(a)(ii), or as soon as is required by law following the Distribution Date, as
the case may be, a registration statement under the Act, with respect to the
shares of 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 such filing, and (iii) cause such registration
statement to remain effective (with a prospectus at all times meeting the
requirements of the Act) until the earlier of (A) the date as of which the
Rights are no longer exercisable for Preferred Stock, and (b) the date of the
expiration of the Rights. The Company may temporarily suspend, for a period of
time not to exceed ninety days, the issuance of
27
<PAGE>
shares of Preferred Stock upon exercise of a Right in order to prepare and file
a registration statement under the Act and permit it to become effective. The
Company will also take such action as may be appropriate under, or to ensure
compliance with, the securities or "blue sky" laws of the various states in
connection with the exercisability of the Rights. Notwithstanding any provision
of this Agreement to the contrary, the Rights shall not be exercisable in any
jurisdiction unless the requisite qualification in such jurisdiction shall have
been obtained and until a registration statement under the Act (if required)
shall have been declared effective.
(e) The Company covenants and agrees that it will pay when due
and payable any and all federal and state Transfer Taxes which may be payable in
respect of the issuance or delivery of the Right Certificates or of any shares
of Preferred Stock issued or delivered 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 a Right Certificate to a Person other
than, or the issuance or delivery of certificates for Preferred Stock upon
exercise of Rights in a name other than that of, the registered holder of the
Right Certificate, and the Company shall not be required to issue or deliver a
Right Certificate or certificate for Preferred Stock to a Person other than such
registered holder until any such Transfer Tax shall
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<PAGE>
have been paid (any such Transfer Tax being payable by the holder of such Right
Certificate at the time of surrender) or until it has been established to the
Company's satisfaction that no such Transfer 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 Preferred Stock represented thereby on, and such certificate shall be
dated as of, the date upon which the Right Certificate evidencing such Rights
was duly surrendered and payment of the Exercise Price (and any applicable
Transfer Taxes) was made; PROVIDED, HOWEVER, that, if the date of such surrender
and payment is a date upon which the Preferred Stock transfer books of the
Company are closed, such Person shall be deemed to have become the record holder
of such shares on, and such certificate shall be dated as of, the next
succeeding Business Day on which the Preferred Stock transfer books of the
Company are open. Prior to the exercise of the Rights evidenced thereby, the
holder of a Right Certificate, as such, shall not be entitled to any rights of a
stockholder of the Company with respect to shares for which the Rights shall be
exercisable, including, without limitation, the right to vote, to receive
dividends or other distributions or to exercise any
29
<PAGE>
preemptive rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
Section 11. ADJUSTMENT OF EXERCISE PRICE OR NUMBER OF SHARES. The
Exercise Price and the number of shares of Preferred Stock which may be
purchased upon exercise of a Right are subject to adjustment from time to time
as provided in this Section 11.
(a) (i) In the event the Company shall at any time after
the date of this Rights Agreement (A) declare or pay any dividend
on Common Stock payable in shares of Common Stock, (B) subdivide
or split the outstanding shares of Common Stock into a greater
number of shares or (C) combine or consolidate the outstanding
shares of Common Stock into a smaller number of shares or effect
a reverse split of the outstanding shares of Common Stock, then
and in each such event the number of shares of Preferred Stock
issuable upon the exercise of a Right after the record date for
such event (if one shall have been established or, if not, after
the date of such event) shall be the number of shares of
Preferred Stock issuable immediately prior to such event
multiplied by a fraction the numerator of which is the number of
Rights outstanding immediately prior to such event and the
denominator of which is the number of Rights outstanding
immediately
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<PAGE>
after such event and the Exercise Price after such event shall be
the Exercise Price in effect immediately prior to such event
multiplied by such fraction. If an event occurs which would
require an adjustment under both this Section 11(a)(i) and
Section 11(a)(ii) hereof, the adjustment provided for in this
Section 11(a)(i) shall be in addition to, and shall be made prior
to, any adjustment required pursuant to Section 11(a)(ii).
(ii) Subject to Section 27 of this Agreement, in the event
that any Person (other than an Exempt Person), alone or together
with its Affiliates and Associates, shall become an Acquiring
Person, then, subject to the last sentence of Section 23(a) and
except as otherwise provided in this Section 11, each holder of a
Right, except as provided in Section 7(e) hereof, shall
thereafter have the right to receive upon exercise of such Right
in accordance with the terms of this Rights Agreement and payment
of the Exercise Price, the greater of (1) the number of one
one-hundredths of a share of Preferred Stock for which such Right
was exercisable immediately prior to the first occurrence of the
event described in this Section 11(a)(ii) or (2) such number of
one one-hundredths of a
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<PAGE>
share of Preferred Stock, based on the per share Fair Market
Value of the Preferred Stock (determined pursuant to Section
11(b) hereof) on the date of such first occurrence, having a
value equal to twice the Exercise Price; PROVIDED, HOWEVER, that
if the transaction that would otherwise give rise to the
foregoing adjustment is also subject to the provisions of Section
13 hereof, then only the provisions of Section 13 hereof shall
apply and no adjustment shall be made pursuant to this Section
11(a)(ii).
(iii) In the event that the Company does not have
available sufficient authorized but unissued Preferred Stock to
permit the adjustments required pursuant to the foregoing
subparagraph (i) or the exercise in full of the Rights in
accordance with the foregoing subparagraph (ii), the Company
shall take all such action as may be necessary to authorize and
reserve for issuance such number of additional shares of
Preferred Stock as may from time to time be required to be issued
upon the exercise in full of all Rights from time to time
outstanding and, if necessary, shall use its best efforts to
obtain stockholder approval thereof. In lieu of issuing shares of
Preferred Stock in accordance with the foregoing subparagraphs
(i) and (ii), the Company
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<PAGE>
may, if the Board of Directors determines (but only if at the
time of such determination by the Board of Directors there are
then in office not less than two Continuing Directors and such
action is approved by a majority of the Continuing Directors then
in office) that such action is necessary or appropriate and not
contrary to the interests of holders of Rights, elect to issue or
pay, upon the exercise of the Rights, cash, property, shares of
Preferred or Common Stock, or any combination thereof, having an
aggregate Fair Market Value equal to the Fair Market Value of the
shares of Preferred Stock which otherwise would have been
issuable pursuant to Section 11(a)(ii), which Fair Market Value
shall be determined by an investment banking firm selected by the
Board of Directors (but only if at the time of such selection
there are then in office not less than two Continuing Directors
and such selection is approved by a majority of the Continuing
Directors then in office). For purposes of the preceding
sentence, the Fair Market Value of the Preferred Stock shall be
as determined pursuant to Section 11(b). Subject to Section 23
hereof, any such election by the Board of Directors of the
Company must be made and publicly announced within thirty (30)
days after the
33
<PAGE>
date on which the event described in Section 11(a)(ii) occurs.
(b) For the purpose of this Rights Agreement, the "Fair Market
Value" of any share of Preferred Stock, Common Stock or any other stock or any
Right or other security or any other property on any date shall be determined as
provided in this Section 11(b). In the case of a publicly-traded stock or other
security, the Fair Market Value on any date shall be deemed to be the average of
the daily closing prices per share of such stock or per unit of such other
security for the 30 consecutive Trading Days (as such term is hereinafter
defined) immediately prior to such date; PROVIDED, HOWEVER, that in the event
that the Fair Market Value per share of any share of Common Stock is determined
during a period which includes any date that is within 30 Trading Days after (i)
the ex-dividend date for a dividend or distribution on such stock payable in
shares of Common Stock or securities convertible into shares of Common Stock, or
(ii) the effective date of any subdivision, split, combination, consolidation,
reverse stock split or reclassification of such stock, then, and in each such
case, the Fair Market Value shall be appropriately adjusted by the Board of
Directors of the Company to take into account ex-dividend or post-effective date
trading. The closing price for any day shall be the last sale price, regular
way, or, in case no such sale takes place on such day, the average of the
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<PAGE>
closing bid and asked prices, regular way (in either case, as reported in the
applicable transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock Exchange), or, if the securities are
not listed or admitted to trading on the New York Stock Exchange, as reported in
the applicable transaction reporting system with respect to securities listed on
the principal national securities exchange on which such security is listed or
admitted to trading; or, if not listed or admitted to trading on any national
securities exchange, the last quoted price (or, if not so quoted, the average of
the high bid and low asked prices) in the over-the-counter market, as reported
by the National Association of Securities Dealers, Inc. Automated Quotation
System ("NASDAQ") or such other system then in use; or, if no bids for such
security are quoted by any such organization, the average of the closing bid and
asked prices as furnished by a professional market maker making a market in such
security selected by the Board of Directors of the Company. The term "Trading
Day" shall mean a day on which the principal national securities exchange on
which such security is listed or admitted to trading is open for the transaction
of business or, if such security is not listed or admitted to trading on any
national securities exchange, a Business Day. If a security is not publicly held
or not so listed or traded, "Fair Market Value" shall mean the fair value
35
<PAGE>
per share of stock or per other unit of such other security, as determined by an
independent investment banking firm experienced in the valuation of securities
selected in good faith by the Board of Directors of the Company, or, if no such
investment banking firm is, in the good faith judgment of the Board of
Directors, available to make such determination, in good faith by the Board of
Directors of the Company; PROVIDED, HOWEVER, that for purposes of making the
adjustment provided for by Section 11(a)(ii) hereof, the Fair Market Value of a
share of Preferred Stock shall not be less than 100% of the product of the Fair
Market Value of a share of Common Stock multiplied by the higher of the then
Dividend Multiple or Vote Multiple applicable to the Preferred Stock (as defined
in the Certificate of Designations relating to the Preferred Stock) and shall
not exceed 105% of the product of the then Fair Market Value of a share of
Common Stock multiplied by the higher of the then Dividend Multiple or Vote
Multiple applicable to the Preferred Stock. In the case of property other than
securities, the "Fair Market Value" thereof shall be determined in good faith by
the Board of Directors of the Company based upon such appraisals or valuation
reports of such independent experts as the Board of Directors of the Company
shall in good faith determine to be appropriate in accordance with good business
practices and the interests of the holders of Rights. Any such determination of
Fair Market Value shall be
36
<PAGE>
described in a statement filed with the Rights Agent and shall be binding upon
the Rights Agent.
(c) All calculations under this Section 11 shall be made to the
nearest cent or to the nearest one one-hundredth of a share, as the case may be.
(d) Irrespective of any adjustment or change in the Exercise
Price or the number of shares of Preferred Stock issuable upon the exercise of
the Rights, the Right Certificates theretofore and thereafter issued may
continue to express the Exercise Price and the number of shares to be issued
upon exercise of the Rights as in the initial Right Certificates issued
hereunder but, nevertheless, shall represent the Rights as so adjusted.
(e) Before taking any action that would cause an adjustment
reducing the purchase price per whole share of Preferred Stock upon exercise of
the Rights below the then par value, if any, of the shares of Preferred Stock,
the Company shall use its best efforts to take any corporate action which may,
in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue fully paid and non-assessable shares of such Preferred
Stock at such adjusted purchase price per share.
(f) Anything in this Section 11 to the contrary notwithstanding,
in the event of any reclassification of stock of
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the Company or any recapitalization, reorganization or partial liquidation of
the Company or similar transaction, the Company shall be entitled to make such
further adjustments in the number of shares of Preferred Stock which may be
acquired upon exercise of the Rights, and such adjustments in the Exercise Price
therefor, in addition to those adjustments expressly required by the other
paragraphs of this Section 11, as the Board of Directors of the Company shall
determine to be necessary or appropriate in order for the holders of the Rights
in such event to be treated equitably and in accordance with the purpose and
intent of this Rights Agreement or in order that any such event shall not, but
for such adjustment, in the opinion of counsel to the Company, result in the
stockholders of the Company being subject to any United States federal income
tax liability by reason thereof.
(g) In the event the Company shall at any time after the Record
Date make any distribution on the shares of Common Stock of the Company, whether
by way of a dividend or a reclassification of stock, a recapitalization,
reorganization or partial liquidation of the Company or otherwise, in cash or
any debt security, debt instrument, real or personal property or any other
property (other than any shares of Common Stock or other capital stock of the
Company and other than any right or warrant to acquire any such shares,
including any debt security convertible into or exchangeable for any such share,
at less than the Fair
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Market Value of such shares) and the amount of such cash dividend or the Fair
Market Value of such debt security, debt instrument or property exceeds 150% of
the aggregate amount of the cash dividends declared or paid on the Common Stock
of the Company in the 15-month period immediately preceding such distribution,
then and in each such event, unless such distribution is part of or is made in
connection with a transaction to which Section 11(a)(ii) or Section 13 hereof
applies, the Exercise Price shall be reduced by an amount equal to the cash or
the Fair Market Value of such distribution, as the case may be, per share of
Common Stock of the Company. For purposes hereof, the Fair Market Value of any
property distributed to the holders of shares of Common Stock of the Company
shall be the Fair Market Value of such property as determined by an independent
investment banking firm experienced in the valuation of securities or the other
property so distributed, as the case may be, selected in good faith by the Board
of Directors of the Company, or, if no such investment banking firm is in the
good faith judgment of the Board of Directors available to make such
determination, in good faith by the Board of Directors of the Company, whose
determination shall be final and binding on the Company, the Rights Agent and
the holders of Rights.
Section 12. CERTIFICATION OF ADJUSTED EXERCISE PRICE OR NUMBER OF
SHARES. Whenever an adjustment is made as provided
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in Section 11, 13 or 23(c), the Company shall (a) promptly prepare a certificate
setting forth such adjustment, and a brief statement of the facts giving rise to
such adjustment, (b) promptly file with the Rights Agent and with each transfer
agent for the Preferred Stock a copy of such certificate and (c) mail a brief
summary thereof to each holder of a Right Certificate in accordance with Section
25. Notwithstanding the foregoing sentence, the failure of the Company to make
such certification or give such notice shall not affect the validity of or the
force or effect of the requirement for such adjustment. Any adjustment to be
made pursuant to Section 11, 13 or 23(c) of this Rights Agreement shall be
effective as of the date of the event giving rise to such adjustment. The Rights
Agent shall be fully protected in relying on any such certificate and on any
adjustment therein contained and shall not be deemed to have knowledge of any
adjustment unless and until it shall have received such certificate.
Section 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS
OR EARNING POWER CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR EARNING
POWER.
(a) In the event that, at any time after the time that any
Person becomes an Acquiring Person, (x) the Company shall, directly or
indirectly, consolidate with, or merge with and into, any other Person or
Persons (other than an Exempt Person) and the Company shall not be the surviving
or continuing
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corporation of such consolidation or merger, or (y) any Person or Persons (other
than an Exempt Person) shall, directly or indirectly, consolidate with, or merge
with and into, the Company, and the Company shall be the continuing or surviving
corporation of such consolidation or merger and, in connection with such
consolidation or merger, all or part of the outstanding shares of Common Stock
shall be changed into or exchanged for stock or other securities of any other
Person (other than an Exempt Person) or of the Company or cash or any other
property, or (z) the Company or one or more of its Subsidiaries shall, directly
or indirectly, sell or otherwise transfer to any other Person or any Affiliate
or Associate of such Person, in one or more transactions, or the Company or one
or more of its Subsidiaries shall sell or otherwise transfer to any Persons in
one or a series of related transactions, assets or earning power aggregating
more than 50% of the assets or earning power of the Company and its Subsidiaries
(taken as a whole), then, on the first occurrence of any such event, proper
provision shall be made so that (i) each holder of record of a Right, except as
provided in Section 7(e) hereof, shall thereafter have the right to receive,
upon the exercise thereof and payment of the Exercise Price in accordance with
the terms of this Rights Agreement, such number of shares of validly issued,
fully paid, non-assessable and freely tradeable Common Stock of the Principal
Party (as
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defined herein), not subject to any liens, encumbrances, rights of first refusal
or other adverse claims, as shall, based on the Fair Market Value of the Common
Stock of the Principal Party on the date of the Consummation of such
consolidation, merger, sale or transfer, equal twice the Exercise Price; (ii)
such Principal Party shall thereafter be liable for, and shall assume, by virtue
of such consolidation, merger, sale or transfer, all the obligations and duties
of the Company pursuant to this Rights Agreement; (iii) the term "Company" for
all purposes of this Rights Agreement shall thereafter be deemed to refer to
such Principal Party; (iv) such Principal Party shall take such steps
(including, but not limited to, the reservation of a sufficient number of shares
of its Common Stock in accordance with the provisions of Section 9 hereof
applicable to the reservation of Preferred 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;
PROVIDED, HOWEVER, that, upon the subsequent occurrence of any merger,
consolidation, sale of all or substantially all of the assets, recapitalization,
reclassification of shares, reorganization or other extraordinary transaction in
respect of such Principal Party, each holder of a Right shall thereupon be
entitled to receive, upon exercise of a Right and
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payment of the Exercise Price, such cash, shares, rights, warrants and other
property which such holder would have been entitled to receive had it, at the
time of such transaction, owned the shares of Common Stock of the Principal
Party purchasable upon the exercise of a Right, and such Principal Party shall
take such steps (including, but not limited to, reservation of shares of stock)
as may be necessary to permit the subsequent exercise of the Rights in
accordance with the terms hereof for such cash, shares, rights, warrants and
other property and (v) the provisions of Section 11(a)(ii) hereof shall be of no
effect following the occurrence of any event described in clause (x), (y) or (z)
above of this Section 13(a).
(b) "Principal Party" shall mean
(i) in the case of any transaction described in (x) or (y)
of the first sentence of Section 13(a) hereof: (A) the Person that is the issuer
of the securities into which shares of Common Stock of the Company are changed
or otherwise exchanged or converted in such merger or consolidation, or, if
there is more than one such issuer, the issuer of the Common Stock of which has
the greatest market value or (B) if no securities are so issued, (x) the Person
that is the other party to the merger or consolidation and that survives such
merger or consolidation, or, if there is more than one such Person, the Person
the Common Stock of which has the greatest market value or
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(y) if the Person that is the other party to the merger or consolidation does
not survive the merger or consolidation, the Person that does survive the merger
or consolidation (including the Company if it survives); and
(ii) in the case of any transaction described in (z) of the
first sentence in Section 13(a), the Person that is the party receiving the
greatest portion of the assets or earning power transferred pursuant to such
transaction or transactions, or, if each Person that is a party to such
transaction or transactions receives the same portion of the assets or earning
power so transferred or if the Person receiving the greatest portion of the
assets or earning power cannot be determined, whichever of such Persons as is
the issuer of Common Stock having the greatest market value of shares
outstanding; PROVIDED, HOWEVER, that in any such case, if the Common Stock of
such Person is not at such time and has not been continuously over the preceding
12-month period registered under Section 12 of the Exchange Act, and such Person
is a direct or indirect Subsidiary of another Person the Common Stock of which
is and has been so registered, the term "Principal Party" shall refer to such
other Person, or if such Person is a Subsidiary, directly or indirectly, of more
than one Person, the Common Stocks of all of which are and have been so
registered, the term "Principal Party" shall refer to whichever
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of such Persons is the issuer of the Common Stock having the greatest market
value of shares outstanding.
(c) The Company shall not consummate any consolidation, merger or
sale or transfer of assets or earning power referred to in Section 13(a) unless
the Principal Party shall have a sufficient number of authorized shares of its
Common Stock that have not been issued or reserved for issuance to permit
exercise in full of all Rights in accordance with this Section 13 and unless
prior thereto the Company and the Principal Party involved therein shall have
executed and delivered to the Rights Agent an agreement confirming that the
Principal Party shall, upon consummation of such consolidation, merger or sale
or transfer of assets or earning power, assume this Rights Agreement in
accordance with Section 13(a) hereof and that all rights of first refusal or
preemptive rights in respect of the issuance of shares of Common Stock of the
Principal Party upon exercise of outstanding Rights have been waived and that
such transaction shall not result in a default by the Principal Party under this
Rights Agreement, and further providing that, as soon as practicable after the
date of any consolidation, merger or sale or transfer of assets or earning power
referred to in Section 13(a) hereof, the Principal Party will:
(i) prepare and file a registration statement under the
Act with respect to the Rights and the
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securities purchasable upon exercise of the Rights on an
appropriate form, use its best efforts to cause such
registration statement to become effective as soon as practicable
after such filing and 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 date of
expiration of the Rights, and similarly comply with applicable
state securities laws;
(ii) use its best efforts to list (or continue the listing
of) the Rights and the securities purchasable upon exercise of
the Rights on a national securities exchange or to meet the
eligibility requirements for quotation on NASDAQ; and
(iii) deliver to holders of the Rights historical
financial statements for the Principal Party which comply in all
respects with the requirements for registration on Form 10 (or
any successor form) under the Exchange Act. In the event that any
of the transactions described in Section 13(a) hereof shall occur
at any time after the occurrence of a transaction described in
Section 11(a)(ii) hereof, the Rights which have not theretofore
been exercised shall, subject to
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the provisions of Section 7(e) hereof, thereafter be exercisable
in the manner described in Section 13(a).
(d) In case the Principal Party which is to be a party to a
transaction referred to in this Section 13 has a provision in any of its
authorized securities or in its Certificate of Incorporation or By-laws or other
instrument governing its corporate affairs, which provision would have the
effect of (i) causing such Principal Party to issue, in connection with, or as a
consequence of, the consummation of a transaction referred to in this Section
13, shares of Common Stock of such Principal Party at less than the then Fair
Market Value per share (determined pursuant to Section 11(b) hereof) or
securities exercisable for, or convertible into, Common Stock of such Principal
Party at less than such then Fair Market Value (other than to holders of Rights
pursuant to this Section 13) or (ii) providing for any special tax or similar
payment in connection with the issuance to any holder of a Right of Common Stock
of such Principal Party pursuant to the provisions of this Section 13, then, in
such event, the Company shall not consummate any such transaction unless prior
thereto the Company and such Principal Party shall have executed and delivered
to the Rights Agent a supplemental agreement providing that the provision in
question of such Principal Party shall have been canceled, waived or amended, or
that the authorized securities shall be redeemed, so that the
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applicable provision will have no effect in connection with, or as a consequence
of, the consummation of the proposed transaction.
Section 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES
(a) The Company shall not be required to issue fractions of
Rights or to distribute Right Certificates which evidence fractional Rights
(i.e., Rights to acquire less than one one-hundredth of a share of Preferred
Stock), unless such fractional Rights result from a transaction referred to in
Section 11(a)(i) hereof. If the Company shall determine not to issue such
fractional Rights, then, in lieu of such fractional Rights, there shall be paid
to the holders of record of the Right Certificates with regard to which such
fractional Rights would otherwise be issuable, an amount in cash equal to the
same fraction of the Fair Market Value of a whole Right.
(b) The Company shall not be required to issue fractions of
shares of Preferred Stock (other than fractions which are integral multiples of
one-hundredth of a share) upon exercise of the Rights or to distribute
certificates which evidence fractional shares (other than fractions which are
integral multiples of one-hundredth of a share). In lieu of issuing fractions of
shares of Preferred Stock, the Company may, at its election, issue depositary
receipts evidencing fractions of shares pursuant to an appropriate agreement
between the
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Company and a depositary selected by it, provided that such agreement shall
provide that the holders of such depositary receipts shall have all of the
rights, privileges and preferences to which they would be entitled as owners of
the Preferred Stock. With respect to fractional shares that are not integral
multiples of one-hundredth of a share, if the Company does not issue such
fractional shares or depositary receipts in lieu thereof, there shall be paid to
the holders of record of Right Certificates at the time such Right Certificates
are exercised as herein provided an amount in cash equal to the same fraction of
the Fair Market Value of a share of Preferred Stock.
(c) The holder of a Right by the acceptance of a Right expressly
waives his right to receive any fractional Right or any fractional shares of
Preferred Stock (other than fractions which are integral multiples of one
one-hundredth of a share) upon exercise of a Right.
Section 15. RIGHTS OF ACTION. All rights of action in respect of
this Rights Agreement, except the rights of action given to the Rights Agent in
Section 18 hereof, are vested in the respective registered holders of the Right
Certificates (and, prior to the Distribution Date, the holders of record of the
Common Stock); and any holder of record of any Right Certificate (or, prior to
the Distribution Date, of the Common Stock), without the consent of the Rights
Agent or of the holder of any
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other Right Certificate (or, prior to the Distribution Date, of the Common
Stock), may, in his own behalf and for his own benefit, enforce, and may
institute and maintain any suit, action or proceeding against the Company to
enforce, or otherwise act in respect of, his right to exercise the Rights
evidenced by such Right Certificate in the manner provided in such Right
Certificate and in this Rights 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 Rights Agreement and will be entitled to specific performance of
the obligations under, and injunctive relief against actual or threatened
violations of, the obligations of any Person subject to this Rights Agreement.
Section 16. AGREEMENT OF RIGHT HOLDERS. Each holder of a Right,
by accepting the same, consents and agrees with the Company and the Rights Agent
and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights shall be evidenced
by the certificates for Common Stock registered in the name of the
holders of Common Stock (together, as applicable, with the Summary of
Rights), which certificates for Common Stock shall also constitute
certificates for Rights, and not by separate Right Certificates, and
each
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Right shall be transferable only simultaneously and together with
the transfer of shares of Common Stock;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if
surrendered at the office of the Rights Agent designated for such
purpose, duly endorsed or accompanied by a proper instrument of
transfer; and
(c) the Company and the Rights Agent may deem and treat the
person in whose name the Right Certificate (or, prior to the
Distribution Date, the associated Common Stock certificate) is
registered as the absolute owner thereof and of the Rights evidenced
thereby (notwithstanding any notations of ownership or writing on the
Right Certificates or the associated Common Stock certificate made by
anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent shall be
affected by any notice to the contrary.
Section 17. RIGHT CERTIFICATE HOLDER NOT DEEMED A STOCKHOLDER. No
holder, as such, of any Right Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of Preferred Stock or any
other securities which may at any time be issuable on the exercise of the Rights
represented thereby, nor shall anything contained herein or in any Right
Certificate be construed to confer upon the holder of any
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Right Certificate, as such, any of the rights of a stockholder of the Company or
any right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof (except as provided in Section 7(f) hereof),
or to give or withhold consent to any corporate action (except as provided in
Section 7(f) hereof), or to receive notice of meetings or other actions
affecting stockholders (except as provided in Section 24 hereof), or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by such Right Certificate shall have been exercised in accordance with
the provisions hereof.
Section 18. CONCERNING THE RIGHTS AGENT.
(a) The Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from time to time,
on demand of the Rights Agent, its reasonable expenses and counsel fees and
other disbursements incurred in the administration and execution of this Rights
Agreement and the exercise and performance of its duties hereunder. The Company
also agrees to indemnify the Rights Agent for, and to hold it harmless against,
any loss, liability, or expense, incurred without negligence, bad faith or
willful misconduct on the part of the Rights Agent, for anything done or omitted
to be done by the Rights Agent in connection with the acceptance and
administration of this Rights Agreement, including
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the cost and expenses of defending against any claim of liability relating to
the Rights or this Rights Agreement.
(b) The Rights Agent shall be protected against, 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 Rights Agreement in reliance upon
any Right Certificate or certificate for Preferred 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 OF, OR CHANGE IN NAME OF, THE
RIGHTS AGENT.
(a) Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights Agent
or any successor Rights Agent shall be a party, or any corporation succeeding to
the corporate trust or stock transfer business of the Rights Agent or any
successor Rights Agent, shall be the successor to the Rights Agent under this
Rights 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
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appointment as a successor Rights Agent under the provisions of Section 21
hereof. In case at the time such successor Rights Agent shall succeed to the
agency created by this Rights 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
Right Certificates so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Right Certificates either in the name of the predecessor Rights
Agent or in the name of the successor Rights Agent; and in all such cases such
Right Certificates shall have the full force provided in the Right Certificates
and in this Rights Agreement.
(b) In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver Right Certificates so countersigned; in case at
that time any of the Right Certificates shall not have been countersigned, the
Rights Agent may countersign such Right Certificates either in its prior name or
in its changed name; in all such cases such Right Certificates shall have the
full force provided in the Right Certificates and in this Rights Agreement.
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Section 20. DUTIES OF RIGHTS AGENT. The Rights Agent undertakes
the duties and obligations imposed by this Rights Agreement upon the following
terms and conditions, by all of which the Company and the holders of Right
Certificates by their acceptance thereof shall be bound:
(a) The Rights Agent may consult with legal counsel (who may be
legal counsel for the Company), and the opinion of such counsel shall be full
and complete authorization and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Rights
Agreement the Rights Agent shall deem it necessary or desirable that any fact or
matter be proved or established by the Company prior to taking or suffering any
action hereunder, such 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
or any Vice President and by the Treasurer or the Secretary of the Company and
delivered to the Rights Agent. Any 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 Rights Agreement in reliance upon such certificate.
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(c) The Rights Agent shall be liable hereunder only for its own
negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any
of the statements of fact or recitals contained in this Rights Agreement or in
the Right Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be deemed to
have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Rights Agreement or the execution and delivery
hereof (except the due execution hereof by the Rights Agent) or in respect of
the validity or execution of any Right Certificate (except its countersignature
thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Rights Agreement or in any Right
Certificate; nor shall it be responsible for any adjustment required under the
provisions of Section 11 or 13 hereof or responsible for the manner, method or
amount of any such adjustment or the ascertaining of the existence of facts that
would require any such adjustment (except with respect to the exercise of Rights
evidenced by Right Certificates after receipt of a certificate describing 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
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shares of Preferred Stock to be issued pursuant to this Rights Agreement or any
Right Certificate or as to whether any shares of Preferred Stock will, when
issued, be validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge
and deliver or cause to be performed, executed, acknowledged and delivered all
such further and other acts, instruments and assurances as may reasonably be
required by the Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of the Rights 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 or any Vice President or the Secretary or
the Treasurer of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable for any
action taken or suffered to be taken by it in good faith in accordance with
instructions of any such officer.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though it were not the
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Rights Agent under this Rights 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.
Section 21. CHANGE OF RIGHTS AGENT. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties under this
Rights Agreement upon 30 days' notice in writing mailed to the Company and to
each transfer agent of the Common Stock and the Preferred Stock by registered or
certified mail. The Company may remove the Rights Agent or any successor Rights
Agent (with or without cause) 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 the Preferred Stock by registered or certified
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.
Notwithstanding the foregoing provisions of this
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Section 21, in no event shall the resignation or removal of a Rights Agent be
effective until a successor Rights Agent shall have been appointed and have
accepted such appointment. If the Company shall fail to make such appointment
within a period of 30 days after such removal or after it has been notified in
writing of such resignation or incapacity by the resigning or incapacitated
Rights Agent or by the holder of a Right Certificate (who shall, with such
notice, submit his Right Certificate for inspection by the Company), then the
incumbent Rights Agent or the holder of record of any Right Certificate may
apply to any court of competent jurisdiction for the appointment of a new Rights
Agent. Any successor Rights Agent, whether appointed by the Company or by such a
court, shall be (a) a corporation organized and doing business under the laws of
the United States or of any state thereof, in good standing, which is authorized
under such laws to exercise corporate trust or stock transfer powers and is
subject to supervision or examination in the conduct of its corporate trust or
stock transfer business by federal or state authorities and which has at the
time of its appointment as Rights Agent a combined capital and surplus of at
least $5,000,000 or (b) an Affiliate controlled by a corporation described in
clause (a) of this sentence. After appointment, the successor Rights Agent shall
be vested with the same powers, rights, duties and responsibilities as if it had
been originally
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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 Preferred Stock, and mail a notice thereof in writing to the registered
holders of the Right Certificates. Failure to give any notice provided for in
this Section 21, however, or any defect therein, shall not affect the legality
or validity of the resignation or removal of the Rights Agent or the appointment
of the successor Rights Agent, as the case may be. Notwithstanding the foregoing
provisions, in the event of resignation, removal or incapacity of the Rights
Agent, the Company shall have the authority to act as the Rights Agent until a
successor Rights Agent shall have assumed the duties of the Rights Agent
hereunder.
Section 22. ISSUANCE OF NEW RIGHT CERTIFICATES. Notwithstanding
any of the provisions of this Rights Agreement or of the Rights to the contrary,
the Company may, at its option, issue new Right Certificates evidencing Rights
in such form as may be approved by its Board of Directors to reflect any
adjustment or change in the Exercise Price per share and the number or
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kind or class of shares of stock or other securities or property purchasable
under the Right Certificates made in accordance with the provisions of this
Rights Agreement.
Section 23. REDEMPTION.
(a) The Company may, at its option, but only by the vote of a
majority of the Board of Directors, redeem all but not less than all of the then
outstanding Rights, at any time prior to the Close of Business on the earlier of
(i) the tenth day following the Stock Acquisition Date (subject to extension by
the Company as provided in Section 26 hereof) or (ii) the Final Expiration Date,
at a redemption price of $.01 per Right, subject to adjustments as provided in
subsection (c) below (the "Redemption Price"); PROVIDED, HOWEVER, that from and
after the time that any Person shall become an Acquiring Person, the Company may
redeem the Rights only if at the time of the action of the Board of Directors
there are then in office not less than two Continuing Directors and such
redemption is approved by a majority of the Continuing Directors then in office.
Notwithstanding anything contained in this Agreement to the contrary, the Rights
shall not be exercisable pursuant to Section 11(a)(ii) prior to the expiration
of the Company's right of redemption hereunder.
(b) Without any further action and without any notice, the right
to exercise the Rights will terminate effective at the
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time so designated by action of the Board of Directors ordering the redemption
of the Rights and the only right thereafter of the holders of Rights shall be to
receive the Redemption Price. Within 10 days after the effective time of the
action of the Board of Directors ordering the redemption of the Rights, the
Company shall give notice of such redemption to 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 Distribution Date, on the registry books of the transfer agent for the
Common Stock. Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each notice of
redemption will state the method by which the payment of the Redemption Price
will be made. At the option of the Board of Directors, the Redemption Price may
be paid in cash to each Rights holder or by the issuance of shares (and, at the
Company's election pursuant to Section 14(b) hereof, cash or depositary receipts
in lieu of fractions of shares other than fractions which are integral multiples
of one one-hundredth (1/100) of a share) of Preferred Stock or Common Stock
having a Fair Market Value equal to such cash payment.
(c) In the event the Company shall at any time after the date of
this Rights Agreement (A) pay any dividend on Common Stock in shares of Common
Stock, (B) subdivide or split the out
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<PAGE>
standing shares of Common Stock into a greater number of shares or (C) combine
or consolidate the outstanding shares of Common Stock into a smaller number of
shares or effect a reverse split of the outstanding shares of Common Stock,
then, and in each such event, the Redemption Price shall be appropriately
adjusted to reflect the foregoing.
Section 24. NOTICE OF PROPOSED ACTIONS.PROPOSED ACTIONS
(a) In case the Company, after the Distribution Date, shall
propose (i) to effect any of the transactions referred to in Section 11(a)(i) or
11(g) or (ii) to offer to the holders of record of its Common Stock options,
warrants, or other rights to subscribe for or to purchase shares of Common Stock
(including any security convertible into or exchangeable for Common Stock) or
shares of stock of any class or any other securities, options, warrants,
convertible or exchangeable securities or other rights, or (iii) to effect any
reclassification of its Preferred Stock or Common Stock or any recapitalization
or reorganization of the Company, or (iv) to effect any consolidation or merger
with or into, or to effect any sale or other transfer (or to permit one or more
of its Subsidiaries to effect any sale or other transfer), in one or more
transactions, of more than 50% of the assets or earning power of the Company and
its Subsidiaries (taken as a whole) to, any other Person or Persons, or (v) to
effect the liquidation, dissolution or winding up of the Company, then, in
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<PAGE>
each such case, the Company shall give to each holder of record of a Right
Certificate, in accordance with Section 25, notice of such proposed action,
which shall specify the record date for the purposes of such transaction
referred to in Section 11(a)(i) or such dividend or distribution, or the date on
which such reclassification, recapitalization, reorganization, consolidation,
merger, sale or transfer of assets, liquidation, dissolution, or winding up is
to take place and the record date for determining participation therein by the
holders of record of Common Stock or Preferred Stock, if any such date is to be
fixed, and such notice shall be so given in the case of any action covered by
clause (i) or (ii) above at least 10 days prior to the record date for
determining holders of record of the Preferred Stock for purposes of such
action, and in the case of any such other action, at least 10 days prior to the
date of the taking of such proposed action or the date of participation therein
by the holders of record of Common Stock or Preferred Stock, whichever shall be
the earlier. The failure to give notice required by this Section 24 or any
defect therein shall not affect the legality or validity of the action taken by
the Company or the vote upon any such action.
(b) In case any of the transactions referred to in Section
11(a)(i), 11(g) or 13 of this Rights Agreement are proposed, then, in any such
case, the Company shall give to each
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<PAGE>
holder of Rights, in accordance with Section 25 hereof, notice of the proposal
of such transaction at least 10 days prior to consummating such transaction,
which notice shall specify the proposed event and the consequences of the event
to holders of Rights under Section 11(a)(i), 11(g) or 13 hereof, as the case may
be, and, upon consummating such transaction, shall similarly give notice thereof
to each holder of Rights.
Section 25. NOTICES. Notices or demands authorized by this Rights
Agreement to be given or made by the Rights Agent or by the holder of record of
any Right Certificate or Right to or on the Company shall be sufficiently given
or made if sent by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Rights Agent) as follows:
Premier Parks Inc.
11501 Northeast Expressway
Oklahoma City, Oklahoma 73131
Subject to the provisions of Section 21, any notice or demand authorized by this
Rights Agreement to be given or made by the Company or by the holder of record
of any Right Certificate or Right to or on the Rights Agent shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed (until another address is filed in writing with the Company) as
follows:
Bank One Trust Company
P.O. Box 25848
Oklahoma City, Oklahoma 73125
65
<PAGE>
Notices or demands authorized by this Rights Agreement to be given or made by
the Company or the Rights Agent to the holder of record of any Right Certificate
or Right shall be sufficiently given or made if sent by first-class mail,
postage prepaid, addressed to such holder at the address of such holder as shown
on the registry books of the Company.
Section 26. SUPPLEMENTS AND AMENDMENTS. For as long as the Rights
are then redeemable and except as provided in the last sentence of this Section
26, the Company may in its sole and absolute discretion, and the Rights Agent
shall if the Company so directs, supplement or amend any provision of this
Agreement without the approval of any holders of the Rights. At any time when
the Rights are not then redeemable and except as provided in the last sentence
of this Section 26, the Company may, and the Rights Agent shall if the Company
so directs, supplement or amend this Rights Agreement without the approval of
any holders of Right Certificates (i) to cure any ambiguity, (ii) to correct or
supplement any provision contained herein which may be defective or inconsistent
with any other provisions herein or (iii) to change or supplement the provisions
hereunder in any manner which the Company may deem necessary or desirable,
provided that no such supplement or amendment pursuant to this clause (iii)
shall materially adversely affect the interest of the holders of Right
Certificates. Upon the delivery of a certificate from an appro
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<PAGE>
priate officer of the Company which states that the proposed supplement or
amendment is in compliance with the terms of this Section 26, the Rights Agent
shall execute such supplement or amendment. This Agreement may be amended or
supplemented at any time with the approval of a majority of the registered
holders of the Right Certificates (and, prior to the Distribution Date, the
Common Stock). Notwithstanding anything contained in this Rights Agreement to
the contrary, no supplement or amendment shall be made which changes the
Redemption Price or the Final Expiration Date and supplements or amendments may
be made after the time that any Person becomes an Acquiring Person only if at
the time of the action of the Board of Directors approving such supplement or
amendment there are then in office not less than two Continuing Directors and
such supplement or amendment is approved by a majority of the Continuing
Directors then in office.
Section 27. EXCHANGE. (a) The Board of Directors of the Company
may, at its option, at any time after any Person becomes an Acquiring Person,
exchange all or part of the then outstanding and exercisable Rights (which shall
not include Rights that have become void pursuant to the provisions of Section
7(e) hereof) for shares of Common Stock at an exchange ratio of one share per
Right, appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such exchange ratio being
hereinafter
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<PAGE>
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 an Exempt Person), together with all Affiliates and
Associates of such Person, becomes the Beneficial Owner of 50% or more of the
Voting Stock then outstanding.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the exchange of any Rights pursuant to paragraph (a) of this
Section 27 and without any further action and without any notice, the right to
exercise such Rights shall terminate and the only right thereafter of a holder
of such Rights shall be to receive that number of shares of Common Stock equal
to the number of such Rights held by such holder multiplied by the Exchange
Ratio. The Company shall promptly give public notice of any such exchange;
PROVIDED, HOWEVER, that the failure to give, or any defect in, such notice shall
not affect the validity of such exchange. The Company promptly shall mail a
notice of any such exchange to all of the holders of such Rights at their last
addresses as they appear upon the registry books of the Rights Agent. Any notice
which is mailed in the manner herein provided shall be deemed given, whether or
not the holder receives the notice. Each such notice of exchange will state the
method by which the exchange of the shares of Common Stock for Rights will be
effected and, in the
68
<PAGE>
event of any partial exchange, the number of Rights which will be exchanged. Any
partial exchange shall be effected pro rata based on the number of Rights (other
than Rights which have become void pursuant to the provisions of Section 7(e)
hereof) held by each holder of Rights.
(c) In the event that there shall not be sufficient shares of
Common Stock issued but not outstanding or authorized but unissued to permit any
exchange of Rights as contemplated in accordance with this Section 27, the
Company shall take all such action as may be necessary to authorize additional
shares of Common Stock for issuance upon exchange of the Rights.
(d) The Company shall not be required to issue fractions of
shares of Common Stock or to distribute certificates which evidence fractional
shares. 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 of Common Stock would otherwise be issuable an amount in cash
equal to the same fraction of the current market value of a whole share of
Common Stock. For the purposes of this paragraph (d), the current market value
of a whole share of Common Stock shall be the closing price of a share of Common
Stock for the Trading Day immediately prior to the date of exchange pursuant to
this Section 27.
69
<PAGE>
Section 28. SUCCESSORS. All of the covenants and provisions of
this Rights 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 RIGHTS AGREEMENT. Nothing in this
Rights Agreement shall be construed to give to any person or corporation other
than the Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the holders of Common Stock
in their capacity as holders of the Rights) any legal or equitable right, remedy
or claim under this Rights Agreement; but this Rights Agreement shall be for the
sole and exclusive benefit of the Company, the Rights Agent and the holders of
record of the Right Certificates (and, prior to the Distribution Date, the
holders of Common Stock in their capacity as holders of the Rights).
Section 30. DELAWARE CONTRACT. This Rights Agreement and each
Right Certificate issued hereunder shall be deemed to be a contract made under
the laws of the State of Delaware and for all purposes shall be governed by and
construed and enforced in accordance with the laws of such state applicable to
contracts to be made and performed entirely within such state.
Section 31. COUNTERPARTS. This Rights Agreement may be executed
in any number of counterparts and each of such coun
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terparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same instrument.
Section 32. DESCRIPTIVE HEADINGS. Descriptive headings of the
several Sections of this Rights Agreement are inserted for convenience only and
shall not control or affect the meaning or construction of any of the provisions
hereof.
Section 33. SEVERABILITY. If any term, provision, covenant or
restriction of this Rights 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 Rights
Agreement shall remain in full force and effect and shall in no way be affected,
impaired or invalidated.
71
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Rights
Agreement to be duly executed, all as of the day and year first above written.
By ________________________________
Name: James F. Dannhauser
Title: Chief Financial Officer
By ________________________________
Name:
Title:
<PAGE>
EXHIBIT A
UNDER CERTAIN CIRCUMSTANCES AS PROVIDED IN THE
RIGHTS AGREEMENT (AS REFERRED TO BELOW), RIGHTS
ISSUED TO OR BENEFICIALLY OWNED BY ACQUIRING PERSONS OR
THEIR AFFILIATES OR ASSOCIATES (AS SUCH TERMS ARE DEFINED
IN THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH
RIGHTS SHALL BE NULL AND
VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.
PREMIER PARKS INC.
SUMMARY OF RIGHTS TO PURCHASE
SERIES A JUNIOR PREFERRED STOCK
The Board of Directors of Premier Parks Inc. (the "Company") has
declared a dividend distribution of one Preferred Stock Purchase Right for each
outstanding share of Common Stock, par value $.05 per share (the "Common
Stock"), of the Company. The distribution is payable as of January 12, 1998 to
stockholders of record on that date. Each Right entitles the registered holder
to purchase from the Company one one-hundredth (1/100) of a share of preferred
stock of the Company, designated as Series A Junior Preferred Stock (the
"Preferred Stock") at a price of $250.00 per one one-hundredth (1/100) of a
share ("Exercise Price"). The description and terms of the Rights are set forth
in a Rights Agreement (the "Rights Agreement") between the Company and Bank One
Trust Company, N.A., as Rights Agent (the "Rights Agent").
AS DISCUSSED BELOW, INITIALLY THE RIGHTS WILL NOT BE EXERCISABLE,
CERTIFICATES WILL NOT BE SENT TO STOCKHOLDERS AND THE RIGHTS WILL AUTOMATICALLY
TRADE WITH THE COMMON STOCK.
The Rights, unless earlier redeemed by the Board of Directors,
become exercisable upon the close of business on the day (the "Distribution
Date") which is the earlier of (i) the tenth day following a public announcement
that a person or group of affiliated or associated persons, with certain
exceptions set forth below, has acquired beneficial ownership of 15% or more of
the outstanding voting stock of the Company (an "Acquiring Person") and (ii) the
tenth business day (or such later date as may be determined by the Board of
Directors prior to such time as any person or group of affiliated or associated
persons becomes an Acquiring Person) after the date of the commencement or
announcement of a person's or group's intention to commence a tender or exchange
offer the consummation of which would result
<PAGE>
in the ownership of 15% or more of the Company's outstanding voting stock (even
if no shares are actually purchased pursuant to such offer); prior thereto, the
Rights would not be exercisable, would not be represented by a separate
certificate, and would not be transferable apart from the Company's Common
Stock, but will instead be evidenced, with respect to any of the Common Stock
certificates outstanding as of January 12, 1998, by such Common Stock
certificate with a copy of this Summary of Rights attached thereto. An Acquiring
Person does not include (A) the Company, (B) any subsidiary of the Company, (C)
any employee benefit plan or employee stock plan of the Company or of any
subsidiary of the Company, or any trust or other entity organized, appointed,
established or holding Common Stock for or pursuant to the terms of any such
plan or (D) any person or group whose ownership of 15% or more of the shares of
voting stock of the Company then outstanding results solely from (i) any action
or transaction or transactions approved by the Board of Directors before such
person or group became an Acquiring Person or (ii) a reduction in the number of
issued and outstanding shares of voting stock of the Company pursuant to a
transaction or transactions approved by the Board of Directors (provided that
any person or group that does not become an Acquiring Person by reason of clause
(i) or (ii) above shall become an Acquiring Person upon acquisition of an
additional 1% of the Company's voting stock unless such acquisition of
additional voting stock will not result in such person or group becoming an
Acquiring Person by reason of such clause (i) or (ii)).
Until the Distribution Date (or earlier redemption or expiration
of the Rights), new Common Stock certificates issued after January 12, 1998 will
contain a legend incorporating the Rights Agreement by reference. Until the
Distribution Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any of the Common Stock certificates outstanding as of
January 12, 1998, with or without a copy of this Summary of Rights attached
thereto, will also constitute the transfer of the Rights associated with the
Common Stock represented by such certificate. As soon as practicable following
the Distribution Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Common Stock as of the
close of business on the Distribution Date and such separate certificates alone
will evidence the Rights from and after the Distribution Date.
The Rights are not exercisable until the Distribution Date. The
Rights will expire at the close of business on January 12, 2008, unless earlier
redeemed by the Company as described below.
2
<PAGE>
The Preferred Stock is nonredeemable and, unless otherwise
provided in connection with the creation of a subsequent series of preferred
stock, subordinate to any other series of the Company's preferred stock. The
Preferred Stock may not be issued except upon exercise of Rights. Each share of
Preferred Stock will be entitled to receive when, as and if declared, a
quarterly dividend in an amount equal to the greater of $1.00 per share or 100
times the cash dividends declared on the Company's Common Stock. In addition,
Preferred Stock is entitled to 100 times any non-cash dividends (other than
dividends payable in equity securities) declared on the Common Stock, in like
kind. In the event of the liquidation of the Company, the holders of Preferred
Stock will be entitled to receive, for each share of Preferred Stock, a payment
in an amount equal to the greater of $25,000.00 or 100 times the payment made
per share of Common Stock. Each share of Preferred Stock will have 100 votes,
voting together with the Common Stock. In the event of any merger, consolidation
or other transaction in which Common Stock is exchanged, each share of Preferred
Stock will be entitled to receive 100 times the amount received per share of
Common Stock. The rights of Preferred Stock as to dividends, liquidation and
voting are protected by anti-dilution provisions.
The number of shares of Preferred Stock issuable upon exercise of
the Rights is subject to certain adjustments from time to time in the event of a
stock dividend on, or a subdivision or combination of, the Common Stock. The
Exercise Price for the Rights is subject to adjustment in the event of
extraordinary distributions of cash or other property to holders of Common
Stock.
Unless the Rights are earlier redeemed, in the event that, after
the time that a Person becomes an Acquiring Person, the Company were to be
acquired in a merger or other business combination (in which any shares of
Common Stock are changed into or exchanged for other securities or assets) or
more than 50% of the assets or earning power of the Company and its subsidiaries
(taken as a whole) were to be sold or transferred in one or a series of related
transactions, the Rights Agreement provides that proper provision will be made
so that each holder of record of a Right will from and after such date have the
right to receive, upon payment of the Exercise Price, that number of shares of
common stock of the acquiring company having a market value at the time of such
transaction equal to two times the Exercise Price.
3
<PAGE>
In addition, unless the Rights are earlier redeemed, in the event
that a person or group becomes the beneficial owner of 15% or more of the
Company's voting stock, the Rights Agreement provides that proper provisions
will be made so that each holder of record of a Right, other than the Acquiring
Person (whose Rights will thereupon become null and void), will thereafter have
the right to receive, upon payment of the Exercise Price, that number of shares
of the Preferred Stock having a market value at the time of the transaction
equal to two times the Exercise Price (such market value to be determined with
reference to the market value of the Company's Common Stock as provided in the
Rights Agreement).
At any time after any person or group becomes an Acquiring Person
and prior to the acquisition by such person or group of 50% or more of the
outstanding voting stock, the Board of Directors of the Company may exchange the
Rights (other than Rights owned by such person or group which will have become
void), in whole or in part, at an exchange ratio of one share of Common Stock
per Right (subject to adjustment).
Fractions of shares of Preferred Stock (other than fractions
which are integral multiples of one one-hundredth of a share) may, at the
election of the Company, be evidenced by depositary receipts. The Company may
also issue cash in lieu of fractional shares which are not integral multiples of
one one-hundredth of a share.
At any time on or prior to the close of business on the earlier
of (i) the tenth day after the time that a person has become an Acquiring Person
(or such later date as a majority of the Board of Directors and a majority of
the Continuing Directors (as defined in the Rights Agreement) may determine) or
(ii) January 12, 2008, the Company may redeem the Rights in whole, but not in
part, at a price of $.01 per Right (the "Redemption Price"). The Rights may be
redeemed after the time that any Person has become an Acquiring Person only if
approved by a majority of the Continuing Directors. Immediately upon the
effective time of the action of the Board of Directors of the Company
authorizing redemption of the Rights, the right to exercise the Rights will
terminate and the only right of the holders of Rights will be to receive the
Redemption Price.
For as long as the Rights are then redeemable, the Company may,
except with respect to the redemption price or date of expiration of the Rights,
amend the Rights in any manner, including an amendment to extend the time period
in which the Rights may be redeemed. At any time when the Rights are not then
4
<PAGE>
redeemable, the Company may amend the Rights in any manner that does not
materially adversely affect the interests of holders of the Rights as such.
Amendments to the Rights Agreement from and after the time that any Person
becomes an Acquiring Person requires the approval of a majority of the
Continuing Directors (as provided in the Rights Agreement).
Until a Right is exercised, the holder, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends.
A copy of the Rights Agreement has been filed with the Securities
and Exchange Commission as an Exhibit to a Current Report on Form 8-K. A copy of
the Rights Agreement is available free of charge from the Company. This summary
description of the Rights does not purport to be complete and is qualified in
its entirety by reference to the Rights Agreement which is incorporated in this
summary description herein by reference.
5
<PAGE>
EXHIBIT B
[Form of Right Certificate]
Certificate No. W- ______ Rights
NOT EXERCISABLE AFTER JANUARY 12, 2008 OR EARLIER IF REDEEMED. THE
RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY AND UNDER
CERTAIN OTHER CIRCUMSTANCES, AT $.01 PER RIGHT (SUBJECT TO ADJUSTMENT),
ON THE TERMS SET FORTH OR REFERRED TO IN THE RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES AS PROVIDED IN THE RIGHTS AGREEMENT (AS REFERRED
TO BELOW), RIGHTS ISSUED TO OR BENEFICIALLY OWNED BY ACQUIRING PERSONS
OR THEIR AFFILIATES OR ASSOCIATES (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS SHALL BE NULL
AND VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.
Right Certificate
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 January 12, 1998 (the "Rights Agreement") between Premier Parks
Inc., a Delaware corporation (the "Company"), and Bank One Trust Company, N.A.,
a national banking association, (the "Rights Agent"), to purchase from the
Company at any time after the Distribution Date (as such term is defined in the
Rights Agreement) and prior to 5:00 P.M. (Oklahoma City, Oklahoma time) on
January 12, 2008 at the office of the Rights Agent designated in the Rights
Agreement for such purpose, or its
<PAGE>
successor as Rights Agent, in Oklahoma City, Oklahoma, one one-hundredth (1/100)
of a fully paid nonassessable share of Series A Junior Preferred Stock (the
"Preferred Stock") of the Company at a purchase price of $250.00, as the same
may from time to time be adjusted in accordance with the Rights Agreement (the
"Exercise Price"), upon presentation and surrender of this Right Certificate
with the Form of Election to Purchase attached hereto duly executed.
As provided in the Rights Agreement, the Exercise Price and the
number of shares of Preferred Stock which may be purchased upon the exercise of
the Rights evidenced by this Right Certificate are subject to modification and
adjustment upon the happening of certain events and, upon the happening of
certain events, securities other than shares of Preferred Stock, or other
property, may be acquired upon exercise of the Rights evidenced by this Right
Certificate, as provided in the Rights Agreement.
This Right Certificate is subject to all of the terms, provisions
and conditions of the Rights Agreement, which terms, provisions and conditions
are 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 of the Rights Agent,
the Company and the holders of record of Right Certificates.
2
<PAGE>
Copies of the Rights Agreement are on file at the principal executive office of
the Company.
This Right Certificate, with or without other Right Certificates,
upon surrender at the office of the Rights Agent designated in the Rights
Agreement for such purpose, may be exchanged for another Right Certificate or
Right Certificates of like tenor and date evidencing Rights entitling the holder
of record to purchase a like aggregate number of shares of Preferred Stock as
the Rights evidenced by the Right Certificate or Right Certificates surrendered
shall have entitled such holder to purchase. If this Right Certificate shall be
exercised in part, the holder shall be entitled to receive upon surrender
hereof, another Right Certificate or Right Certificates for the number of whole
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 or
under certain other circumstances at a redemption price of $.01 per Right.
No fractional shares of Preferred Stock (other than fractions
which are integral multiples of one one-hundredth (1/100) of a share) are
required to be issued upon the exercise of any Right or Rights evidenced hereby,
and in lieu thereof the Company may cause depositary receipts to be issued
and/or a cash payment may be made, as provided in the Rights Agreement.
3
<PAGE>
No holder of this Right Certificate, as such, shall be entitled
to vote or receive dividends or be deemed for any purpose the holder of
Preferred Stock or of any other securities of the Company which may at any time
be issuable on the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any
of the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at meeting
thereof, or to give or withhold consent to any corporate action or to receive
notice of meetings or other actions affecting stockholders (except as provided
in the Rights Agreement), or to receive dividends or subscription rights, or
otherwise, until the Right or Rights evidenced by this Right Certificate shall
have been exercised as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
4
<PAGE>
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal. Dated as of _____________, 199_.
ATTEST:
By
-------------------- ------------------------
Secretary Title:
Countersigned:
[Rights Agent]
By
------------------
Authorized Signature
5
<PAGE>
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificates.)
FOR VALUE RECEIVED__________________________________
hereby sells, assigns and transfers unto__________________________
__________________________________________________________________
(Please print name and address of transferee)
Rights evidenced by this Right Certificate, together with all right,
title and interest therein, and does hereby irrevocably constitute and
appoint _____________________________ Attorney to transfer the within
Right Certificate on the books of the within-named Company, with full
power of substitution.
Dated:________________, 199__
-------------------------
Signature
Signature Guaranteed:
6
<PAGE>
Certificate
The undersigned hereby certifies by checking the appropriate boxes that:
(1) this Right Certificate [ ] is [ ] is not being
sold, assigned or transferred by or on behalf of a Person who is or was
an Acquiring Person or an Associate or an Affiliate thereof (as such
terms are defined in the Rights Agreement); and
(2) after due inquiry and to the best knowledge of the
undersigned, it [ ] did [ ] did not acquire the Rights evidenced by this
Right Certificate from any Person who is, was or subsequently became an
Acquiring Person or an Affiliate or Associate thereof (as such terms are
defined in the Rights Agreement).
Dated: ____________, 199__ ________________________
Signature
NOTICE
The signature to the foregoing Assignment and Certificate
must correspond to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement or
any change whatsoever.
7
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed if registered holder
desires to exercise the Right Certificate.)
TO _____________________:
The undersigned hereby irrevocably elects to exercise
_________________ Rights represented by this Right Certificate to
purchase the shares of Preferred Stock issuable upon the exercise of
such Rights and requests that certificates for such share(s) be issued
in the following name:
Please insert social security or other identifying number:_____________
_______________________________________________________________________
(Please print name and address)
_______________________________________________________________________
If such number of Rights shall not be all the Rights evidenced by this
Right Certificate, a new Right Certificate for the balance remaining of
such Rights shall be registered in the name of and delivered to:
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<PAGE>
Please insert social security
or other identifying number:__________________________________________
______________________________________________________________________
(Please print name and address)
Dated: _____________, 199__
----------------------------
Signature
(Signature must conform in all
respects to name of holder as
specified on the fact of this
Right Certificate)
Signature Guaranteed:
9
<PAGE>
EXHIBIT C
FORM OF
CERTIFICATE OF DESIGNATIONS, PREFERENCES AND RIGHTS
OF
SERIES A JUNIOR PREFERRED STOCK
OF
PREMIER PARKS, INC.
Pursuant to Section 151 of the
Delaware General Corporation Law
I, James F. Dannhauser, Chief Financial Officer of Premier Parks
Inc., a corporation organized and existing under the Delaware General
Corporation Law (the "Company"), in accordance with the provisions of Section
151 of such law, DO HEREBY CERTIFY that pursuant to the authority conferred upon
the Board of Directors by Article IV of the Certificate of Incorporation of the
Company, the Board of Directors on December 10, 1997 adopted the following
resolution which creates a series of 206,400 shares of Preferred Stock
designated as Series A Junior Preferred Stock, as follows:
RESOLVED, that pursuant to Section 151 of the Delaware General
Corporation Law and the authority vested in the Board of Directors of the
Company in accordance with the provisions of ARTICLE IV of the Certificate of
Incorporation of the Company, a series of Preferred Stock of the Company be, and
hereby is, created, and the powers, designations, preferences and relative,
participating, optional or other
<PAGE>
special rights of the shares of such series, and the qualifications, limitations
or restrictions thereof, be, and hereby are, as follows:
Section 1. DESIGNATION AND AMOUNT. The shares of such series
shall be designated as "Series A Junior Preferred Stock" (the "Series A
Preferred Stock") and the number of shares constituting such series shall be
206,400.
Section 2. DIVIDENDS AND DISTRIBUTIONS.
(A) Subject to the provisions for adjustment hereinafter set
forth, the holders of shares of Series A Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds legally
available for the purpose, (i) cash dividends in an amount per share (rounded to
the nearest cent) equal to 100 times the aggregate per share amount of all cash
dividends declared or paid on the Common Stock, $0.05 par value per share, of
the Company (the "Common Stock") and (ii) a preferential cash dividend (the
"Preferential Dividends"), if any, in preference to the holders of Common Stock,
on the first day of April, July, October and January of each year (each a
"Quarterly Dividend Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a share of
Series A Preferred Stock, payable in an amount (except in the case of
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<PAGE>
the first Quarterly Dividend Payment if the date of the first issuance of Series
A Preferred Stock is a date other than a Quarterly Dividend Payment date, in
which case such payment shall be a prorated amount of such amount) equal to
$1.00 per share of Series A Preferred Stock less the per share amount of all
cash dividends declared on the Series A Preferred Stock pursuant to clause (i)
of this sentence since the immediately preceding Quarterly Dividend Payment Date
or, with respect to the first Quarterly Dividend Payment Date, since the first
issuance of any share or fraction of a share of Series A Preferred Stock. In the
event the Company shall, at any time after the issuance of any share or fraction
of a share of Series A Preferred Stock, make any distribution on the shares of
Common Stock of the Company, whether by way of a dividend or a reclassification
of stock, a recapitalization, reorganization or partial liquidation of the
Company or otherwise, which is payable in cash or any debt security, debt
instrument, real or personal property or any other property (other than cash
dividends subject to the immediately preceding sentence, a distribution of
shares of Common Stock or other capital stock of the Company or a distribution
of rights or warrants to acquire any such share, including any debt security
convertible into or exchangeable for any such share, at a price less than the
3
<PAGE>
Fair Market Value (as hereinafter defined) of such share), then, and in each
such event, the Company shall simultaneously pay on each then outstanding share
of Series A Preferred Stock of the Company a distribution, in like kind, of 100
times such distribution paid on a share of Common Stock (subject to the
provisions for adjustment hereinafter set forth). The dividends and
distributions on the Series A Preferred Stock to which holders thereof are
entitled pursuant to clause (i) of the first sentence of this paragraph and
pursuant to the second sentence of this paragraph are hereinafter referred to as
"Dividends" and the multiple of such cash and non-cash dividends on the Common
Stock applicable to the determination of the Dividends, which shall be 100
initially but shall be adjusted from time to time as hereinafter provided, is
hereinafter referred to as the "Dividend Multiple". In the event the Company
shall at any time after January 12, 1998 declare or pay any dividend or make any
distribution on Common Stock payable in shares of Common Stock, or effect a
subdivision or split or a combination, consolidation or reverse split of the
outstanding shares of Common Stock into a greater or lesser number of shares of
Common Stock, then in each such case the Dividend Multiple thereafter applicable
to the determination of the amount of Dividends which holders of shares of
Series
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<PAGE>
A Preferred Stock shall be entitled to receive shall be the Dividend Multiple
applicable immediately prior to such event multiplied by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
(B) The Company shall declare each Dividend at the same time it
declares any cash or non-cash dividend or distribution on the Common Stock in
respect of which a Dividend is required to be paid. No cash or non-cash dividend
or distribution on the Common Stock in respect of which a Dividend is required
to be paid shall be paid or set aside for payment on the Common Stock unless a
Dividend in respect of such dividend or distribution on the Common Stock shall
be simultaneously paid, or set aside for payment, on the Series A Preferred
Stock.
(C) Preferential Dividends shall begin to accrue on outstanding
shares of Series A Preferred Stock from the Quarterly Dividend Payment Date next
preceding the date of issuance of any shares of Series A Preferred Stock.
Accrued but unpaid Preferential Dividends shall cumulate but shall not bear
interest. Preferential Dividends paid on the shares of Series A Preferred Stock
in an amount less than
5
<PAGE>
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.
Section 3. VOTING RIGHTS. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provisions for adjustment hereinafter set
forth, each share of Series A Preferred Stock shall entitle the holder thereof
to 100 votes on all matters submitted to a vote of the holders of the Common
Stock. The number of votes which a holder of Series A Preferred Stock is
entitled to cast, as the same may be adjusted from time to time as hereinafter
provided, is hereinafter referred to as the "Vote Multiple". In the event the
Company shall at any time after January 12, 1998 declare or pay any dividend on
Common Stock payable in shares of Common Stock, or effect a subdivision or split
or a combination, consolidation or reverse split of the outstanding shares of
Common Stock into a greater or lesser number of shares of Common Stock, then in
each such case the Vote Multiple thereafter applicable to the determination of
the number of votes per share to which holders of shares of Series A Preferred
Stock shall be entitled after such event
6
<PAGE>
shall be the Vote Multiple immediately prior to such event multiplied 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, in the Restated
Certificate of Incorporation or By-laws, the holders of shares of Series A
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 Company.
(C) In the event that the Preferential Dividends accrued on the
Series A Preferred Stock for four or more quarterly dividend periods, whether
consecutive or not, shall not have been declared and paid or irrevocably set
aside for payment, the holders of record of Preferred Stock of the Company of
all series (including the Series A Preferred Stock), other than any series in
respect of which such right is expressly withheld by the Restated Certificate of
Incorporation or the authorizing resolutions included in any Certificate of
Designations therefor, shall have the right, at the next meeting of stockholders
called for the election of directors, to elect two members to the Board of
7
<PAGE>
Directors, which directors shall be in addition to the number required by the
By-laws prior to such event, to serve until the next Annual Meeting and until
their successors are elected and qualified or their earlier resignation, removal
or incapacity or until such earlier time as all accrued and unpaid Preferential
Dividends upon the outstanding shares of Series A Preferred Stock shall have
been paid (or irrevocably set aside for payment) in full. The holders of shares
of Series A Preferred Stock shall continue to have the right to elect directors
as provided by the immediately preceding sentence until all accrued and unpaid
Preferential Dividends upon the outstanding shares of Series A Preferred Stock
shall have been paid (or set aside for payment) in full. Such directors may be
removed and replaced by such stockholders, and vacancies in such directorships
may be filled only by such stockholders (or by the remaining director elected by
such stockholders, if there be one) in the manner permitted by law; provided,
however, that any such action by stockholders shall be taken at a meeting of
stockholders and shall not be taken by written consent thereto.
(D) Except as otherwise required by the Certificate of
Incorporation or By-laws or set forth herein, holders of Series A Preferred
Stock shall have no other special voting rights and their consent shall not be
8
<PAGE>
required (except to the extent they are entitled to vote with holders of Common
Stock as set forth herein) for the taking of any corporate action.
Section 4. CERTAIN RESTRICTIONS.
(A) Whenever Preferential Dividends or Dividends are in arrears
or the Company shall be in default of payment thereof, thereafter and until all
accrued and unpaid Preferential Dividends and Dividends, whether or not
declared, on shares of Series A Preferred Stock outstanding shall have been paid
or set irrevocably aside for payment in full, and in addition to any and all
other rights which any holder of shares of Series A Preferred Stock may have in
such circumstances, the Company shall not
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire for
consideration, any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the Series
A Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity as to
dividends with the Series A Preferred Stock, unless dividends are paid
ratably on the Series A Preferred Stock and all such parity stock on
which
9
<PAGE>
dividends are payable or in arrears in proportion to the total amounts
to which the holders of all such shares are then entitled if the full
dividends accrued thereon were to be paid;
(iii) except as permitted by subparagraph (iv) of this
paragraph 4(A), 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) with the
Series A Preferred Stock, provided that the Company may at any time
redeem, purchase or otherwise acquire shares of any such parity stock
in exchange for shares of any stock of the Company ranking junior
(both as to dividends and upon liquidation, dissolution or winding up)
to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of stock ranking on a
parity with the Series A Preferred Stock (either as to dividends or upon
liquidation, dissolution or winding up), except in accordance with a
purchase offer made 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
10
<PAGE>
respective series and classes, shall determine in good faith will result
in fair and equitable treatment among the respective series or classes.
(B) The Company shall not permit any Subsidiary (as hereinafter
defined) of the Company to purchase or otherwise acquire for consideration any
shares of stock of the Company unless the Company could, under paragraph (A) of
this Section 4, purchase or otherwise acquire such shares at such time and in
such manner. A "Subsidiary" of the Company shall mean any corporation or other
entity of which securities or other ownership interests having ordinary voting
power sufficient to elect a majority of the board of directors of such
corporation or other entity or other persons performing similar functions are
beneficially owned, directly or indirectly, by the Company or by any corporation
or other entity that is otherwise controlled by the Company.
(C) The Company shall not issue any shares of Series A Preferred
Stock except upon exercise of Rights issued pursuant to that certain Rights
Agreement dated as of January 12, 1998 between the Company and Bank One Trust
Company, N.A., as Rights Agent, a copy of which is on file with the Secretary of
the Company at its principal executive office and shall be made available to
stockholders of record without charge upon written request therefor addressed to
11
<PAGE>
said Secretary. Notwithstanding the foregoing sentence, nothing contained in the
provisions hereof shall prohibit or restrict the Company from issuing for any
purpose any series of Preferred Stock with rights and privileges similar to,
different from, or greater than, those of the Series A Preferred Stock.
Section 5. REACQUIRED SHARES. Any shares of Series A Preferred
Stock purchased or otherwise acquired by the Company in any manner whatsoever
shall be retired and cancelled promptly after the acquisition thereof. All such
shares upon their retirement and cancellation shall become authorized but
unissued shares of Preferred Stock, without designation as to series, and such
shares may be reissued as part of a new series of Preferred Stock to be created
by resolution or resolutions of the Board of Directors.
Section 6. LIQUIDATION, DISSOLUTION OR WINDING UP. Upon any
voluntary or involuntary liquidation, dissolution or winding up of the Company,
no distribution shall be made (i) to the holders of shares of stock ranking
junior (either as to dividends or upon liquidation, dissolution or winding up)
to the Series A Preferred Stock unless the holders of shares of Series A
Preferred Stock shall have received for each share of Series A Preferred Stock,
subject to adjustment as hereinafter provided, (A) $25,000.00 plus
12
<PAGE>
an amount equal to accrued and unpaid dividends and distributions thereon,
whether or not declared, to the date of such payment or, (B) if greater than the
amount specified in clause (i)(A) of this sentence, an amount equal to 100 times
the aggregate amount to be distributed per share to holders of Common Stock, as
the same may be adjusted as hereinafter provided and (ii) to the holders of
stock ranking on a parity upon liquidation, dissolution or winding up with the
Series A Preferred Stock, unless simultaneously therewith distributions are made
ratably on the Series A Preferred Stock and all other shares of such parity
stock in proportion to the total amounts to which the holders of shares of
Series A Preferred Stock are entitled under clause (i)(A) of this sentence and
to which the holders of such parity shares are entitled, in each case upon such
liquidation, dissolution or winding up. The amount to which holders of Series A
Preferred Stock may be entitled upon liquidation, dissolution or winding up of
the Company pursuant to clause (i)(B) of the foregoing sentence is hereinafter
referred to as the "Participating Liquidation Amount" and the multiple of the
amount to be distributed to holders of shares of Common Stock upon the
liquidation, dissolution or winding up of the Company applicable pursuant to
said clause to the determination of the Participating
13
<PAGE>
Liquidation Amount, as said multiple may be adjusted from time to time as
hereinafter provided, is hereinafter referred to as the "Liquidation Multiple".
In the event the Company shall at any time after January 12, 1998 declare or pay
any dividend on Common Stock payable in shares of Common Stock, or effect a
subdivision or split or a combination, consolidation or reverse split of the
outstanding shares of Common Stock into a greater or lesser number of shares of
Common Stock, then, in each such case, the Liquidation Multiple thereafter
applicable to the determination of the Participating Liquidation Amount to which
holders of Series A Preferred Stock shall be entitled after such event shall be
the Liquidation Multiple applicable immediately prior to such event multiplied
by a fraction the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately prior to such
event.
Section 7. CERTAIN RECLASSIFICATIONS AND OTHER EVENTS.
(A) In the event that holders of shares of Common Stock of the
Company receive after January 12, 1998 in respect of their shares of Common
Stock any share of capital stock of the Company (other than any share of Common
Stock
14
<PAGE>
of the Company), whether by way of reclassification, recapitalization,
reorganization, dividend or other distribution or otherwise (a "Transaction"),
then, and in each such event, the dividend rights, voting rights and rights upon
the liquidation, dissolution or winding up of the Company of the shares of
Series A Preferred Stock shall be adjusted so that after such event the holders
of Series A Preferred Stock shall be entitled, in respect of each share of
Series A Preferred Stock held, in addition to such rights in respect thereof to
which such holder was entitled immediately prior to such adjustment, to (i) such
additional dividends as equal the Dividend Multiple in effect immediately prior
to such Transaction multiplied by the additional dividends which the holder of a
share of Common Stock shall be entitled to receive by virtue of the receipt in
the Transaction of such capital stock, (ii) such additional voting rights as
equal the Vote Multiple in effect immediately prior to such Transaction
multiplied by the additional voting rights which the holder of a share of Common
Stock shall be entitled to receive by virtue of the receipt in the Transaction
of such capital stock and (iii) such additional distributions upon liquidation,
dissolution or winding up of the Company as equal the Liquidation Multiple in
effect immediately prior to such Transaction
15
<PAGE>
multiplied by the additional amount which the holder of a share of Common Stock
shall be entitled to receive upon liquidation, dissolution or winding up of the
Company by virtue of the receipt in the Transaction of such capital stock, as
the case may be, all as provided by the terms of such capital stock.
(B) In the event that holders of shares of Common Stock of the
Company receive after January 12, 1998 in respect of their shares of Common
Stock any right or warrant to purchase Common Stock (including as such a right,
for all purposes of this paragraph, any security convertible into or
exchangeable for Common Stock) at a purchase price per share less than the Fair
Market Value of a share of Common Stock on the date of issuance of such right or
warrant, then and in each such event the dividend rights, voting rights and
rights upon the liquidation, dissolution or winding up of the Company of the
shares of Series A Preferred Stock shall each be adjusted so that after such
event the Dividend Multiple, the Vote Multiple and the Liquidation Multiple
shall each be the product of the Dividend Multiple, the Vote Multiple and the
Liquidation Multiple, as the case may be, in effect immediately prior to such
event multiplied by a fraction the numerator of which shall be the number of
shares of Common Stock outstanding immediately before such issuance of rights or
warrants plus the maximum number of shares of Common Stock which could be
acquired upon exercise in full of all such rights or warrants and the
denominator of which shall be the number of shares of Common Stock outstanding
immediately before such
16
<PAGE>
issuance of rights or warrants plus the number of shares of Common Stock which
could be purchased, at the Fair Market Value of the Common Stock at the time of
such issuance, by the maximum aggregate consideration payable upon exercise in
full of all such rights or warrants.
(C) In the event that holders of shares of Common Stock of the
Company receive after January 12, 1998 in respect of their shares of Common
Stock any right or warrant to purchase capital stock of the Company (other than
shares of Common Stock), including as such a right, for all purposes of this
paragraph, any security convertible into or exchangeable for capital stock of
the Company (other than Common Stock), at a purchase price per share less than
the Fair Market Value of such shares of capital stock on the date of issuance of
such right or warrant, then and in each such event the dividend rights, voting
rights and rights upon liquidation, dissolution or winding up of the Company of
the shares of Series A Preferred Stock shall each be adjusted so that after such
event each holder of a share of
17
<PAGE>
Series A Preferred Stock shall be entitled, in respect of each share of Series A
Preferred Stock held, in addition to such rights in respect thereof to which
such holder was entitled immediately prior to such event, to receive (i) such
additional dividends as equal the Dividend Multiple in effect immediately prior
to such event multiplied, first, by the additional dividends to which the holder
of a share of Common Stock shall be entitled upon exercise of such right or
warrant by virtue of the capital stock which could be acquired upon such
exercise and multiplied again by the Discount Fraction (as hereinafter defined)
and (ii) such additional voting rights as equal the Vote Multiple in effect
immediately prior to such event multiplied, first, by the additional voting
rights to which the holder of a share of Common Stock shall be entitled upon
exercise of such right or warrant by virtue of the capital stock which could be
acquired upon such exercise and multiplied again by the Discount Fraction and
(iii) such additional distributions upon liquidation, dissolution or winding up
of the Company as equal the Liquidation Multiple in effect immediately prior to
such event multiplied, first, by the additional amount which the holder of a
share of Common Stock shall be entitled to receive upon liquidation, dissolution
or winding up of the Company upon exercise of such right or warrant by
18
<PAGE>
virtue of the capital stock which could be acquired upon such exercise and
multiplied again by the Discount Fraction. For purposes of this paragraph, the
"Discount Fraction" shall be a fraction the numerator of which shall be the
difference between the Fair Market Value of a share of the capital stock subject
to a right or warrant distributed to holders of shares of Common Stock of the
Company as contemplated by this paragraph immediately after the distribution
thereof and the purchase price per share for such share of capital stock
pursuant to such right or warrant and the denominator of which shall be the Fair
Market Value of a share of such capital stock immediately after the distribution
of such right or warrant.
(D) For purposes of this Certificate of Designations, the "Fair
Market Value" of a share of capital stock of the Company (including a share of
Common Stock) on any date shall be deemed to be the average of the daily closing
price per share thereof over the 30 consecutive Trading Days (as such term is
hereinafter defined) immediately prior to such date; provided, however, that, in
the event that such Fair Market Value of any such share of capital stock is
determined during a period which includes any date that is within 30 Trading
Days after (i) the ex-dividend date for a dividend or distribution on stock
19
<PAGE>
payable in shares of such stock or securities convertible into shares of such
stock, or (ii) the effective date of any subdivision, split, combination,
consolidation, reverse stock split or reclassification of such stock, then, and
in each such case, the Fair Market Value shall be appropriately adjusted by the
Board of Directors of the Company to take into account ex-dividend or
post-effective date trading. The closing price for any day shall be the last
sale price, regular way, or, in case, no such sale takes place on such day, the
average of the closing bid and asked prices, regular way (in either case, as
reported in the applicable transaction reporting system with respect to
securities listed or admitted to trading on the New York Stock Exchange), or, if
the shares are not listed or admitted to trading on the New York Stock Exchange,
as reported in the applicable transaction reporting system with respect to
securities listed on the principal national securities exchange on which the
shares are listed or admitted to trading or, if the shares are not listed or
admitted to trading on any national securities exchange, the last quoted price
or, if not so quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by the National Association of Securities
Dealers, Inc. Automated Quotation System ("NASDAQ") or such other system
20
<PAGE>
then in use, or if on any such date the shares are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the shares selected by the Board of
Directors of the Company. The term "Trading Day" shall mean a day on which the
principal national securities exchange on which the shares are listed or
admitted to trading is open for the transaction of business or, if the shares
are not listed or admitted to trading on any national securities exchange, on
which the New York Stock Exchange or such other national securities exchange as
may be selected by the Board of Directors of the Company is open. If the shares
are not publicly held or not so listed or traded on any day within the period of
30 Trading Days applicable to the determination of Fair Market Value thereof as
aforesaid, "Fair Market Value" shall mean the fair market value thereof per
share as determined in good faith by the Board of Directors of the Company. In
either case referred to in the foregoing sentence, the determination of Fair
Market Value shall be described in a statement filed with the Secretary of the
Company.
Section 8. CONSOLIDATION, MERGER, ETC. In case the Company shall
enter into any consolidation, merger, combination or other transaction in which
the shares of Common
21
<PAGE>
Stock are exchanged for or changed into other stock or securities, cash and/or
any other property, then in any such case each outstanding share of Series A
Preferred Stock shall at the same time be similarly exchanged for or changed
into the aggregate amount of stock, securities, cash and/or other property
(payable in like kind), as the case may be, for which or into which each share
of Common Stock is changed or exchanged multiplied by the highest of the Vote
Multiple, the Dividend Multiple or the Liquidation Multiple in effect
immediately prior to such event.
Section 9. EFFECTIVE TIME OF ADJUSTMENTS.
(A) Adjustments to the Series A Preferred Stock required by the
provisions hereof shall be effective as of the time at which the event requiring
such adjustments occurs.
(B) The Company shall give prompt written notice to each holder
of a share of Series A Preferred Stock of the effect of any adjustment to the
voting rights, dividend rights or rights upon liquidation, dissolution or
winding up of the Company of such shares required by the provisions hereof.
Notwithstanding the foregoing sentence, the failure of the Company to give such
notice shall not affect the validity of or the force or effect of or the
requirement for such adjustment.
22
<PAGE>
Section 10. NO REDEMPTION. The shares of Series A Preferred Stock
shall not be redeemable at the option of the Company or any holder thereof.
Notwithstanding the foregoing sentence of this Section, the Company may acquire
shares of Series A Preferred Stock in any other manner permitted by law, the
provisions hereof and the Certificate of Incorporation of the Company.
Section 11. RANKING. Unless otherwise provided in the Certificate
of Incorporation of the Company or a Certificate of Designations relating to a
subsequent series of preferred stock of the Company, the Series A Preferred
Stock shall rank junior to all other series of the Company's preferred stock as
to the payment of dividends and the distribution of assets on liquidation,
dissolution or winding up and senior to the Common Stock.
Section 12. AMENDMENT. The provisions hereof and the Certificate
of Incorporation of the Company shall not be amended in any manner which would
adversely affect the rights, privileges or powers of the Series A Preferred
Stock without, in addition to any other vote of stockholders required by law,
the affirmative vote of the holders of two-thirds or more of the outstanding
shares of Series A Preferred Stock, voting together as a single class.
23
<PAGE>
IN WITNESS WHEREOF, I have executed and subscribed this
Certificate of Designations and do affirm the foregoing as true under the
penalties of perjury this 8th day of January, 1998.
_________________________________
Name: James F. Dannhauser
Title: Chief Financial Officer
24
