THELEN REID & PRIEST LLP
Attorneys At Law
40 West 57th Street
New York, NY 10019
October 9, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: National Fuel Gas Company
Form U-1 Application-Declaration
(File No. 70-8841)
--------------------------------
Ladies and Gentlemen:
Pursuant to Rule 24 under the Public Utility Holding
Company Act of 1935, as amended, this letter is filed on behalf
of National Fuel Gas Company (the "Company") to notify the
Securities and Exchange Commission (the "Commission") of the
Company's intention to amend its existing rights agreement. The
proposed amendment will be carried out in accordance with the
terms and conditions of the Company's Application-Declaration
filed April 11, 1996 (file no. 70-8841) and pursuant to the order
of the Commission with respect thereto dated June 12, 1996.
Pursuant to the Commission's order, the Company and
Marine Midland Bank, as Rights Agent (the "Rights Agent") have
previously entered into a certain Rights Agreement, dated as of
June 12, 1996 (the "Original Agreement"). The
Application-Declaration authorized by the Commission allows the
Company to amend the Original Agreement as permitted by the terms
thereof. The proposed amendments are in compliance with, and
permitted by, the terms of the Original Agreement.
Pursuant to Section 27 of the Original Agreement, the
Company is authorized to supplement or amend the Original
Agreement from time to time and, so long as its interests are not
adversely affected thereby, the Rights Agent has undertaken to
execute any such supplement or amendment. On September 17, 1998,
the Board of Directors of the Company authorized the officers of
the Company to amend the Original Agreement in certain respects.
The reasons for entering into an amended agreement are
several. First, in light of recent legal developments which have
called into question the validity of provisions in rights plans
conferring special voting rights on certain directors, the
Board of Directors has decided to replace such provision with a
requirement that redemption decisions and other determinations be
made only upon the affirmative vote of three-fourths of the entire
Board of Directors. Second, in light of the fact that various
provisions of the Original Agreement do not contemplate the need
for additional regulatory approval, the Board of Directors has
decided to amend the Original Agreement to qualify certain Company
obligations which may require prior regulatory approval. Third,
the Board of Directors has determined that it is appropriate to
extend the term of the Original Agreement for an additional two
years and to qualify certain provisions thereof.
On the basis of our conversation with the Staff of the
Office of Public Utility Regulation, the Company plans to proceed
with entering into an Amended and Restated Rights Agreement on
or after October 16, 1998.
Attached hereto as Exhibit A-4 please find a draft of
the Amended and Restated Rights Agreement between the Company and
Marine Midland Bank, Rights Agent.
Very truly yours,
Thelen Reid & Priest LLP,
Counsel for National Fuel Gas Company
/s/ Robert J. Reger, Jr.
----------------------------------------
By: Robert J. Reger, Jr.
cc: James R. Peterson
<PAGE>
EXHIBIT INDEX
Exhibit Description
------- -----------
A-4 Draft of Amended & Restated Rights Agreement
DRAFT 9/15/98
NATIONAL FUEL GAS COMPANY
and
MARINE MIDLAND BANK, Rights Agent
RIGHTS AGREEMENT
Amended and Restated as of October _____, 1998
<PAGE>
TABLE OF CONTENTS
Page
RIGHTS AGREEMENT
Section 1. Certain Definitions. . . . . . . . . . . . . . . . . .
Section 2. Appointment of Rights Agent . . . . . . . . . . . . . .
Section 3. Issue of Right Certificates . . . . . . . . . . . . . .
Section 4. Form of Right Certificates. . . . . . . . . . . . . . .
Section 5. Countersignature and Registration . . . . . . . . . . .
Section 6. Transfer, Split Up, Combination and
Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen
Right Certificates . . . . . . . . . . . . . . . . . .
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights. . . . . . . . . . . . . . .
Section 8. Cancellation and Destruction of
Right Certificates. . . . . . . . . . . . . . . . . . .
Section 9. Reservation and Availability of
Shares of Common Stock. . . . . . . . . . . . . . . . .
Section 10. Common Stock Record Date . . . . . . . . . . . . . . .
Section 11. Adjustment of Purchase Price, Number
of Shares or Number of Rights . . . . . . . . . . . . .
Section 12. Certificate of Adjusted Purchase
Price or Number of Shares. . . . . . . . . . . . . . .
Section 13. Consolidation, Merger or Sale or
Transfer of Assets or Earning Power. . . . . . . . . .
Section 14. Fractional Rights and Fractional
Shares. . . . . . . . . . . . . . . . . . . . . . . . .
Section 15. Rights of Action. . . . . . . . . . . . . . . . . . . .
Section 16. Agreement of Right Holders . . . . . . . . . . . . . .
Section 17. Right Certificate Holder Not Deemed a
Stockholder. . . . . . . . . . . . . . . . . . . . . .
Section 18. Concerning the Rights Agent. . . . . . . . . . . . . .
Section 19. Merger or Consolidation or Change of
Name of Rights Agent . . . . . . . . . . . . . . . . .
Section 20. Duties of Rights Agent. . . . . . . . . . . . . . . . .
Section 21. Change of Rights Agent. . . . . . . . . . . . . . . . .
Section 22. Issuance of New Right Certificates . . . . . . . . . .
Section 23. Redemption and Termination. . . . . . . . . . . . . . .
Section 24. Exchange. . . . . . . . . . . . . . . . . . . . . . . .
Section 25. Notice of Certain Events. . . . . . . . . . . . . . . .
Section 26. Notices . . . . . . . . . . . . . . . . . . . . . . . .
Section 27. Supplements and Amendments. . . . . . . . . . . . . . .
Section 28. Successors. . . . . . . . . . . . . . . . . . . . . . .
Section 29. Determinations and Actions by the
Board of Directors . . . . . . . . . . . . . .
Section 30. Benefits of This Agreement. . . . . . . . . . . . .
Section 31. Severability. . . . . . . . . . . . . . . . . . . . . .
Section 32. Governing Law. . . . . . . . . . . . . . . . . . . . .
Section 33. Counterparts. . . . . . . . . . . . . . . . . . . . . .
Section 34. Descriptive Headings. . . . . . . . . . . . . . . . . .
Exhibit A - Form of Right Certificate . . . . . . . . . . . . . . . . .
Form of Assignment . . . . . . . . . . . . . . . . . . . . . .
Certificate. . . . . . . . . . . . . . . . . . . . . . . . . .
Notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Form of Election to Purchase. . . . . . . . . . . . . . . . . .
Exhibit B - Summary of Rights to Purchase
Common Stock. . . . . . . . . . . . . . . . . . . . . . . . . .
<PAGE>
AMENDED AND RESTATED RIGHTS AGREEMENT
This AMENDED AND RESTATED RIGHTS AGREEMENT, dated as of
____________, 1998 (the "Agreement"), between NATIONAL FUEL GAS COMPANY, a New
Jersey corporation (the "Company"), and MARINE MIDLAND BANK, a trust company
organized under the laws of the State of New York (the "Rights Agent").
W I T N E S S E T H
WHEREAS, the Company and the Rights Agent have heretofore
entered into that certain Rights Agreement, dated as of June 12, 1996 (the
"Original Agreement"); and
WHEREAS, the Board of Directors of the Company on March 19,
1996 ("Rights Dividend Declaration Date") authorized and declared a dividend
distribution (the "Distribution") of one Right for each share of Common Stock,
$1.00 par value, of the Company (the "Common Stock") outstanding at the close of
business on July 31, 1996 (the "Record Date") and further authorized and
directed the issuance of one Right (as such number may be adjusted pursuant to
the provisions of Section 11(i) hereof) for each share of Common Stock issued
(whether originally issued or delivered from the Company's treasury stock)
between the Record Date and the earlier of the Distribution Date or the
Expiration Date (as such terms are hereinafter defined), each Right initially
representing the right to purchase one-half of one share of Common Stock, upon
the terms and subject to the conditions hereinafter set forth (the "Rights");
and
WHEREAS, pursuant to Section 27 of the Original Agreement, the
Company is authorized to amend the Original Agreement from time to time and, so
long as its interests are not adversely affected thereby, the Rights Agent has
undertaken to execute any such amendment; and
WHEREAS, the Board of Directors of the Company has determined
that it is necessary and desirable that the Original Agreement be amended in
certain respects; and
WHEREAS, the Rights Agent has determined that the amendments
to the Original Agreement proposed by the Company and reflected in this
Agreement (i) are in compliance with the terms of Section 27 of the Original
Agreement and (ii) will not adversely affect its interests thereunder;
WHEREAS, the Company and the Rights Agent have agreed that,
for ease and convenience of reference, it is desirable to incorporate such
amendments into an instrument which restates in its entirety the Original
Agreement, as so amended;
NOW, THEREFORE, in consideration of the premises and
the mutual agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this
Agreement, the following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as
such term is hereinafter defined) who or which, together with all Affiliates
and Associates (as such terms are hereinafter defined) of such Person, shall be
the Beneficial Owner (as such term is hereinafter defined) of securities of the
Company constituting a Substantial Block (as such term is hereinafter defined),
but shall not include (i) the Company, any Subsidiary (as such term is
hereinafter defined) of the Company, any employee benefit plan of the Company
or of any Subsidiary of the Company or any Person organized, appointed or
established by the Company or any Subsidiary of the Company for or pursuant to
the terms of any such plan, (ii) any Person who or which, together with all
Affiliates and Associates of such Person, becomes the Beneficial Owner of a
Substantial Block solely as a result of a change in the aggregate number of
shares of Voting Stock (as such term is hereinafter defined) outstanding since
the last date on which such Person acquired Beneficial Ownership of any shares
of the Voting Stock constituting all or a portion of such Substantial Block;
and (iii) any Person who or which, together with all Affiliates and Associates
of such Person, becomes the Beneficial Owner of a Substantial Block in the good
faith belief that such acquisition would not (x) cause such Person and its
Affiliates and Associates to become the Beneficial Owner of a Substantial
Block and such Person relied in good faith in computing the percentage of its
voting power on publicly filed reports or documents of the Company which are
inaccurate or out-of-date or (y) otherwise cause a Distribution Date or the
adjustment provided for in Section 11(a) to occur. Notwithstanding clause (ii)
or (iii) of the prior sentence, if any Person that is not an Acquiring Person
due to such clause (ii) or (iii) does not cease to be the Beneficial Owner of
a Substantial Block by the close of business on the fifth Business Day (as
such term is hereinafter defined) after notice from the Company (the date of
notice being the first Business Day) that such Person is the Beneficial Owner
of a Substantial Block, such Person shall, at the end of such five Business
Day period, become an Acquiring Person (and such clause (ii) or (iii) shall no
longer apply to such Person). For purposes of this definition, the
determination whether any Person acted in "good faith" shall be conclusively
determined by the Board of Directors of the Company, acting by the vote
required to redeem the Rights under Section 23.
(b) "Act" shall have the meaning set forth in
Section 9(c) hereof.
(c) "Adjustment Shares" shall have the meaning
set forth in Section 11(a)(ii) hereof.
(d) "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the General Rules
and Regulations under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), as in effect on the date hereof.
(e) "Agreement" shall have the meaning set forth
in the introduction hereto.
(f) A Person shall be deemed the "Beneficial
Owner" of, and shall be deemed to "beneficially own," any securities:
(i) which such Person or any of such
Person's Affiliates or Associates has, directly or indirectly, the right to
acquire (whether such right is exercisable immediately or only after the passage
of time or upon the occurrence of an event) pursuant to any agreement,
arrangement or understanding (whether or not in writing), or upon the exercise
of conversion rights, exchange rights, rights, warrants or options, or
otherwise; provided, however, that a Person shall not be deemed the "Beneficial
Owner" of, or to "beneficially own," (1) 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, (2) securities issuable upon exercise of Rights at any time prior to
the occurrence of a Triggering Event (as such term is hereinafter defined), or
(3) securities issuable upon exercise of Rights from and after the occurrence of
a Triggering Event, which Rights were acquired by such Person or any of such
Person's Affiliates or Associates prior to the Distribution Date or pursuant to
Section 3(a) hereof ("Original Rights") or pursuant to Section 11(i) or Section
22 hereof in connection with an adjustment made with respect to Original Rights;
or
(ii) which such Person or any of such
Person's Affiliates or Associates has, directly or indirectly, the right to vote
or dispose of or has "beneficial ownership" of (as determined pursuant to Rule
13d-3 of the General Rules and Regulations under the Exchange Act), including
pursuant to any agreement, arrangement or understanding (whether or not in
writing); provided, however, that a Person shall not be deemed the "Beneficial
Owner" of, or to "beneficially own," any security under this subparagraph (ii)
if the agreement, arrangement or understanding to vote such security (1) arises
solely from a revocable proxy given in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the applicable rules and
regulations of the Exchange Act and (2) is not then reportable on Schedule 13D
under the Exchange Act (or any comparable or successor report); or
(iii) which are beneficially owned,
directly or indirectly, by any other Person with which such Person or any of
such Person's Affiliates or Associates has any agreement, arrangement or
understanding (whether or not in writing) for the purpose of acquiring, holding,
voting (except pursuant to a revocable proxy as described in the proviso to
subparagraph (ii) of this paragraph (f)) or disposing of any securities of the
Company.
Notwithstanding the foregoing, nothing contained in this definition shall cause
a Person ordinarily engaged in business as an underwriter of securities to be
the "Beneficial Owner" of, or to "beneficially own," any securities acquired in
a bona fide firm commitment underwriting pursuant to an underwriting agreement
with the Company.
(g) "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.
(h) "Certification" shall have the meaning
set forth in Section 18 hereof.
(i) "Close of business" on any given day
shall mean 5:00 P.M., Buffalo, New York time, on such day; provided, however,
that if such day is not a Business Day, it shall mean 5:00 P.M., Buffalo, New
York time, on the next succeeding Business Day.
(j) "Common Stock," when used with reference
to the Company, shall mean the shares of common stock, $1.00 par value, of the
Company. "Common Stock," when used with reference to any Person other than the
Company, shall mean either the capital stock with the greatest voting power of
such other Person or, if such Person is a Subsidiary of another Person, the
equity securities or other equity interest having power to control or direct the
management of such Person.
(k) "Common Stock Equivalent" shall have the
meaning set forth in Section 11(a)(iii).
(l) "Company" shall have the meaning set forth
in the introduction hereto.
(m) "Current Market Price" shall have the meaning
set forth in Section 11(d) hereof.
(n) "Current Value" shall have the meaning set
forth in Section 11(a)(iii) hereof.
(o) _______ "Distribution" shall have the meaning set
forth in the recitals hereto.
(p) _______ "Distribution Date" shall have the
meaning set forth in Section 3(a) hereof.
(q) _______ "Equivalent Common Stock" shall have the
meaning set forth in Section 11(b) hereof.
(r) "Exchange Act" shall have the meaning set
forth in the definitions of "Affiliate" and "Associate" above.
(s) ______ "Exchange Ratio" shall have the meaning
set forth in Section 24(a) hereof.
(t) ______ "Expiration Date" shall have the meaning
set forth in Section 7(a) hereof.
(u) ______ "Final Expiration Date" shall have the
meaning set forth in Section 7(a) hereof.
(v) [Intentionally omitted]
(w) "Original Rights" shall have the meaning set
forth in the definition of "Beneficial Owner" above.
(x) "Person" shall mean any individual, firm,
corporation, limited liability company, partnership (general, limited or limited
liability), trust or other entity, and shall include any successor (by merger or
otherwise) of such entity.
(y) "Principal Party" shall have the meaning
set forth in Section 13(b) hereof.
(z) "Purchase Price" shall have the meaning
set forth in Section 4(a) hereof.
(aa) "Record Date" shall have the meaning set
forth in the recitals hereto.
(bb) "Redemption Price" shall have the meaning
set forth in Section 23(a) hereof.
(cc) "Right Certificate" shall have the meaning
set forth in Section 3(a) hereof.
(dd) "Rights" shall have the meaning set forth in
the recitals hereto.
(ee) "Rights Agent" shall have the meaning set
forth in the introduction hereto.
(ff) "Rights Dividend Declaration Date" shall
have the meaning set forth in the recitals hereto.
(gg) "Section 11(a)(ii) Event" shall mean any
event described in Section 11(a)(ii).
(hh) "Section 11(a)(ii) Trigger Date" shall have
the meaning set forth in Section 11(a)(iii).
(ii) "Section 13 Event" shall mean any event
described in Section 13(a).
(jj) "Shares Acquisition Date" shall mean the
first date of public announcement (which, for purposes of this definition,
includes a report filed pursuant to Section 13(d) of the Exchange Act) by the
Company or an Acquiring Person that an Acquiring Person has become such.
(kk) "Spread" shall have the meaning set forth
in Section 11(a)(iii) hereof.
(ll) "Subsidiary" shall mean, with reference to
any Person, any corporation (or other entity) of which an amount of voting
securities (or comparable ownership interests) sufficient to elect at least a
majority of the directors (or comparable individuals) of such corporation (or
other entity) is beneficially owned or otherwise controlled, directly or
indirectly, by such Person.
(mm) "Substantial Block" shall mean a number of
shares of Voting Stock which have 10% or more of the aggregate voting power of
all outstanding shares of Voting Stock.
(nn) "Substitution Period" shall have the meaning
set forth in Section 11(a)(iii) hereof.
(oo) "Summary of Rights" shall have the meaning
set forth in Section 3(b) hereof.
(pp) "Trading Day" shall have the meaning set
forth in Section 11(d) hereof.
(qq) "Triggering Event" shall mean any
Section 11(a)(ii) Event or Section 13 Event.
(rr) "Voting Stock," as of the date of any
determination, shall mean the shares of Common Stock, $1.00 par value, then
outstanding and any other shares of capital stock of the Company which are
entitled to vote generally in the election of directors.
Section 2. Appointment of Rights Agent. The Company
hereby appoints the Rights Agent to act as agent for the Company in accordance
with the terms and conditions hereof, and the Rights Agent hereby accepts such
appointment. The Company shall act as Co-Rights Agent and may from time to time
appoint such other Co-Rights Agents as it may deem necessary or desirable upon
ten calendar days' written notice to the Rights Agent. In no event shall the
Rights Agent have any duty to supervise or in any way be liable for such
Co-Rights Agents.
Section 3. Issue of Right Certificates. (a) Until the
earlier of (i) the close of business on the tenth calendar day after the Shares
Acquisition Date (or, if the tenth day after the Shares Acquisition Date occurs
before the Record Date, the close of business on the Record Date) or (ii) the
close of business on the tenth calendar day after the date of the commencement
of, or of the first public announcement of the intention of any Person (other
than the Company, any Subsidiary of the Company, any employee benefit plan of
the Company or of any Subsidiary of the Company or any Person organized,
appointed or established by the Company or any Subsidiary of the Company for or
pursuant to the terms of any such plan) to commence, a tender or exchange offer
if, upon consummation thereof, such Person would become an Acquiring Person (the
earlier of the dates in subsection (i) and (ii) hereof being herein referred to
as the "Distribution Date") (x) the Rights will be evidenced (subject to the
provisions of paragraph (b) of this Section 3) by the certificates for the
Common Stock registered in the names of the holders of the Common Stock (which
certificates for Common Stock shall be deemed also to be Right Certificates) and
not by separate Right Certificates, and (y) the right to receive Right
Certificates will be transferable only in connection with the transfer of Common
Stock. As soon as practicable after receipt by the Rights Agent of written
notice from the Company of the Distribution Date, the Rights Agent, at the
Company's expense, will send by first-class, postage prepaid mail, to each
record holder of Common Stock as of the close of business on the Distribution
Date, at the address of such holder shown on the records of the Company, a Right
Certificate, in substantially the form of Exhibit A hereto (a "Right
Certificate"), evidencing one Right for each share of Common Stock so held,
subject to adjustment as provided herein. As of the Distribution Date, the
Rights will be evidenced solely by such Right Certificates.
(b) As soon as
practicable following the Record Date, the Company will send a
copy of a Summary of Rights to Purchase Common Stock, in substantially the form
attached hereto as Exhibit B (the "Summary of Rights"), by first-class, postage
prepaid mail, to each record holder of Common Stock as of the close of business
on the Record Date, at the address of such holder shown on the records of the
Company. With respect to certificates for Common Stock outstanding as of the
Record Date, until the Distribution Date, the Rights will be evidenced by such
certificates for Common Stock, and the registered holders of Common Stock shall
also be the registered holders of the associated Rights. Until the Distribution
Date (or earlier redemption or expiration of the Rights), the surrender for
transfer of any of the certificates for Common Stock outstanding on the Record
Date shall also constitute the transfer of the Rights associated with Common
Stock represented by such certificate.
(c) Rights shall be issued in respect of all
shares of Common Stock issued after the Record Date but prior to the earlier of
the Distribution Date or the Expiration Date (as such term is defined in Section
7), or, in certain circumstances provided in Section 22 hereof, after the
Distribution Date. Certificates representing such shares of Common Stock shall
have impressed on, printed on, written on or otherwise affixed to them the
following legend:
This certificate also evidences and entitles the
holder hereof to certain Rights as set forth in a Rights
Agreement between National Fuel Gas Company and Marine Midland
Bank dated as of June 12, 1996 (the "Rights Agreement"), the
terms of which are hereby incorporated herein by reference and
a copy of which is on file at the principal executive offices
of National Fuel Gas Company. Under certain circumstances, as
set forth in the Rights Agreement, such Rights will be
evidenced by separate certificates and will no longer be
evidenced by this certificate. National Fuel Gas Company will
mail to the holder of this certificate a copy of the Rights
Agreement as in effect on the date of mailing without charge
within five Business Days after receipt of a written request
therefor. Under certain circumstances set forth in the Rights
Agreement, Rights beneficially owned by an Acquiring Person
may become null and void.
After the due execution of any supplement or
amendment to this Agreement in accordance with the terms hereof, the reference
to this Agreement in the foregoing legend shall mean the Agreement as so
supplemented or amended. Until the Distribution Date, the Rights associated with
Common Stock represented by certificates containing the foregoing legend shall
be evidenced by such certificates alone, and the surrender for transfer of any
of such certificates shall also constitute the transfer of the Rights associated
with Common Stock represented by such certificates. In the event that the
Company purchases or acquires any shares of Common Stock after the Record Date
but prior to the Distribution Date, any Rights associated with such Common Stock
shall be deemed canceled and retired so that the Company shall not be entitled
to exercise any Rights associated with the shares of Common Stock which are no
longer outstanding. The failure to print the foregoing legend on any such Common
Stock certificate or any other defect therein shall not affect in any manner
whatsoever the application or interpretation of the provisions of Section 7(e)
hereof.
Section 4. Form of Right Certificates. (a) The Right
Certificates (and the forms of election to purchase shares and of assignment to
be printed on the reverse thereof) shall be substantially the same as Exhibit A
hereto and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock
exchange on which the Rights may from time to time be listed, or to conform to
usage. The Right Certificates shall be in machine-printable format and in a form
reasonably satisfactory to the Rights Agent. Subject to the provisions of
Section 11 and Section 22 hereof, the Right Certificates, whenever distributed,
shall be dated as of the Record Date (or, with respect to Rights appurtenant to
shares of Common Stock issued or, in the case of Company treasury stock,
delivered thereafter, dated as of the date of issuance or delivery of such
shares), shall show the date of countersignature, and on their face shall
entitle the holders thereof to purchase such number of shares of Common Stock
(or following a Triggering Event, other securities, cash or other assets, as the
case may be) as shall be set forth therein at the price set forth therein (such
exercise price per share of Common Stock, the "Purchase Price"), but the number
of such shares and the Purchase Price shall be subject to adjustment as provided
herein.
(b) Any Right Certificate issued pursuant to
Section 3(a) or Section 22 hereof that represents Rights beneficially owned by:
(i) an Acquiring Person or any Associate or Affiliate of an Acquiring Person,
(ii) a transferee of an Acquiring Person (or of any such Associate or Affiliate)
who becomes a transferee after the Acquiring Person becomes such, or (iii) a
transferee of an Acquiring Person (or of any such Associate or Affiliate) who
becomes a transferee prior to or concurrently with the Acquiring Person becoming
such and receives such Rights pursuant to either (A) a transfer (whether or not
for consideration) from the Acquiring Person to holders of equity interests in
such Acquiring Person or to any Person with whom such Acquiring Person has any
continuing agreement, arrangement or understanding (whether or not in writing)
regarding the transferred Rights or (B) a transfer which the Board of Directors
of the Company has determined is part of a plan, arrangement or understanding
(whether or not in writing) which has as a primary purpose or effect the
avoidance of Section 7(e) hereof; and any Right Certificate issued pursuant to
Section 6 or Section 11 hereof, upon transfer, exchange, replacement or
adjustment of any other Right Certificate referred to in this sentence, shall
contain (to the extent feasible) the following legend, modified as applicable to
apply to such Person:
The Rights represented by this Right Certificate are
or were beneficially owned by a Person who was or
became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person (as such terms are
defined in the Rights Agreement). Accordingly, this
Right Certificate and the Rights represented hereby
may become null and void in the circumstances
specified in Section 7(e) of such Agreement.
Section 5. Countersignature and Registration. The
Right Certificates shall be executed on behalf of the Company by one of its
authorized officers either manually or by facsimile signature. The Right
Certificates shall be countersigned by an authorized signatory of the Rights
Agent either manually or by facsimile signature and shall not be valid for any
purpose unless so countersigned. In case any officer of the Company who shall
have signed any of the Right Certificates shall cease to be such officer of the
Company before countersignature by the Rights Agent and issuance and delivery by
the Company, such Right Certificates, nevertheless, may be countersigned by the
Rights Agent, issued and delivered with the same force and effect as though the
person who signed such Right Certificates had not ceased to be such officer of
the Company; and any Right Certificate may be signed on behalf of the Company by
any person who, at the actual date of the execution of such Right Certificate,
shall be a proper officer of the Company to sign such Right Certificate,
although at the date of the execution of this Rights Agreement any such person
was not such an officer.
In case any authorized signatory of the Rights Agent
who shall have countersigned any of the Right Certificates shall cease to be
such signatory before delivery by the Company, such Right Certificates,
nevertheless, may be issued and delivered by the Company with the same force and
effect as though the person who countersigned such Right Certificates had not
ceased to be such signatory; and any Right Certificates may be countersigned on
behalf of the Rights Agent by any person who, at the actual date of the
countersignature of such Right Certificate, shall be a proper signatory of the
Rights Agent to countersign such Right Certificate, although at the date of the
execution of this Rights Agreement any such person was not such a signatory.
Following the Distribution Date, the Rights Agent
will keep or cause to be kept, at its office designated for such purpose, 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 issued hereunder, the number of Rights evidenced on its face by
each of the Right Certificates, the date of each of the Right Certificates and
the date of countersignature of each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and
Exchange of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates. Subject to the provisions of Section 14 hereof, at any time after
the close of business on the Distribution Date, and at or prior to the close of
business on the Expiration Date, any Right Certificate or Right Certificates may
be transferred, split up, combined or exchanged for another Right Certificate or
Right Certificates, entitling the registered holder to purchase a like number of
shares of Common Stock (or following a Triggering Event, other securities, cash
or other assets, as the case may be) as the Right Certificate or Right
Certificates surrendered then entitled such holder (or, in the case of a
transfer, such former holder) to purchase. Any registered holder desiring to
transfer, split up, combine or exchange any Right Certificate or Right
Certificates shall make such request in writing delivered to the Rights Agent,
and shall surrender the Right Certificate or Right Certificates to be
transferred, split up, combined or exchanged at the office of the Rights Agent
designated for such purpose, along with a signature guarantee and such other and
further documentation as the Rights Agent may reasonably request. Neither the
Rights Agent nor the Company shall be obligated to take any action whatsoever
with respect to the transfer of any such surrendered Right Certificate until the
registered holder shall have completed and signed the certificate contained in
the form of assignment on the reverse side of such Right Certificate and shall
have provided such additional evidence, as the Company shall reasonably request,
of the identity of the Beneficial Owner, Affiliates or Associates of such
Beneficial Owner or holder, or of any other Person with which such holder or any
of such holder's Affiliates or Associates has any agreement, arrangement or
understanding (whether or not in writing) for the purpose of acquiring, holding,
voting or disposing of securities of the Company. Thereupon the Rights Agent
shall, subject to Section 14 and Section 20(k) hereof, 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 from a Right
Certificates holder of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any transfer, split up, combination or
exchange of Right Certificates.
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, along with a signature
guarantee and such other and further documentation as the Rights Agent may
reasonably request, and if requested by the Company, reimbursement to the
Company and the Rights Agent of all reasonable expenses incidental thereto, and
upon surrender to the Rights Agent and cancellation of the Right Certificate if
mutilated, the Company will make 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; Purchase Price;
Expiration Date of Rights. (a) Subject to Section 7(e) hereof, the registered
holder of any Right Certificate may exercise the Rights evidenced thereby
(except as otherwise provided herein, including, without limitation, the
restrictions on exercisability set forth in Sections 9 (c) , 11 (a) (iii) , 23
(a) and 24 (b) hereof) in whole or in part at any time after the Distribution
Date upon surrender of the Right Certificate, with the form of election to
purchase on the reverse side thereof duly executed, to the Rights Agent at the
designated office of the Rights Agent, together with payment of the aggregate
Purchase Price for the total number of shares of Common Stock (or other
securities, cash or other assets, as the case may be) as to which the Rights are
then exercisable, at or prior to the earliest of (i) the close of business on
July 31, 2008 (the "Final Expiration Date"), (ii) the time at which the Rights
are redeemed as provided in Section 23 hereof or (iii) the time at which all
exercisable Rights are exchanged as provided in Section 24 hereof, (such
earliest date being herein referred to as the "Expiration Date").
(b) The Purchase Price for each full share of
Common Stock pursuant to the exercise of a Right shall initially be $130.00
(being $65.00 per half share of Common Stock), shall be subject to adjustment
from time to time as provided in Sections 11 and 13 hereof and shall be payable
in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate
representing exercisable Rights, with the form of election to purchase and the
certificate duly executed and completed, accompanied by payment of the Purchase
Price for the number of shares of Common Stock (or other securities, cash or
other assets, as the case may be) to be purchased and an amount equal to any
applicable transfer tax, the Rights Agent shall thereupon, subject to Section
20(k), promptly (i) requisition from the Company certificates for the total
number of shares of Common Stock to be purchased, (ii) when appropriate,
requisition from the Company the amount of cash to be paid in lieu of issuance
of fractional shares in accordance with Section 14, (iii) promptly after receipt
of such certificates, 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 (iv) when appropriate, after receipt
promptly deliver such payment to or upon the order of the registered holder of
such Right Certificate. The payment of the Purchase Price must be made by
certified bank check or bank draft or money order payable to the order of the
Company or the Rights Agent. In the event that the Company is obligated to issue
securities, distribute property or make payment pursuant to section 11(a)(iii)
hereof, the Company will make all arrangements necessary so that check, property
or securities are available for issuance, distribution or payment by the Rights
Agent, if and when appropriate.
(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 to his duly authorized assigns, subject to the provisions
of Section 14 hereof.
(e) Notwithstanding anything in this Agreement
to the contrary, from and after the first occurrence of a Section 11(a)(ii)
Event, any Rights beneficially owned by (i) an Acquiring Person or an Associate
or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person
(or of any such Associate or Affiliate) who becomes a transferee after the
Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for consideration) from the
Acquiring Person to holders of equity interests in such Acquiring Person or to
any Person which whom the Acquiring Person has any continuing agreement,
arrangement or understanding (whether or not in writing) regarding the
transferred Rights or (B) a transfer which the Board of Directors of the Company
has determined is part of a plan, arrangement or understanding (whether or not
in writing) which has as a primary purpose or effect the avoidance of this
section 7(e), shall become null and void without any further action and no
holder of such Rights shall have any rights whatsoever with respect to such
Rights, whether under any provision of this Agreement or otherwise. The Company
shall use all reasonable efforts to insure that the provisions of this Section
7(e) and Section 4(b) hereof are complied with, but shall have no liability to
any holder of Right Certificates or other Person as a result of its failure to
make any determinations with respect to an Acquiring Person, or any of its
Affiliates, Associates or transferees hereunder.
(f) Notwithstanding anything in this Agreement to
the contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder upon the occurrence of
any purported exercise as set forth in this Section 7 unless such registered
holder shall have (i) completed and signed the certificate contained in the form
of election to purchase set forth on the reverse side of the Right Certificate
surrendered for such exercise, and (ii) provided such additional evidence of the
identity of the Beneficial Owner, Affiliates or Associates of such Beneficial
Owner or holder, or of any other Person with which such holder or any of such
holder's Affiliates or Associates has any agreement, arrangement or
understanding (whether or not in writing) for the purpose of acquiring, holding,
voting or disposing of any securities of the Company 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
canceled form, or, if surrendered to the Rights Agent, shall be canceled by it,
and no Right Certificates shall be issued in lieu thereof except as expressly
permitted by any of the provisions of this Rights Agreement. The Company shall
deliver to the Rights Agent for cancellation and retirement, and the Rights
Agent shall so cancel and retire, any other Right Certificate purchased or
acquired by the Company otherwise than upon the exercise thereof. The Rights
Agent shall deliver all canceled Right Certificates to the Company, or shall, at
the written request of the Company, destroy such canceled Right Certificates,
and in such case shall deliver a certificate of destruction thereof to the
Company.
Section 9. Reservation and Availability of Shares of
Common Stock. (a) The Company covenants and agrees that it will use every
reasonable effort to reserve and make available out of its authorized and
unissued shares of Common Stock (and following the occurrence of a Triggering
Event, out of its authorized and unissued other securities), or out of its
authorized and issued shares of Common Stock (and, following the occurrence of a
Triggering Event, out of its authorized and issued other securities) held in its
treasury, the number of shares of Common Stock (and, following the occurrence of
a Triggering Event, other securities) that will be sufficient to permit the
exercise in full of all outstanding Rights (it being understood that any of the
foregoing shares or securities may also be reserved for other purposes) or will
take such other steps as are appropriate to assure that the number of such
shares or securities (or their equivalents) sufficient to permit the exercise in
full of all outstanding Rights will be available upon such exercise. The Company
shall use every reasonable effort to obtain, as soon as practicable following
the occurrence of a Triggering Event (to the extent not theretofore obtained),
such regulatory approvals and take such other action as may be necessary for it
to issue and/or sell securities purchasable upon the exercise of the Rights.
(b) So long as the shares of Common Stock (and,
following the occurrence of a Triggering Event, other securities) issuable upon
the exercise of Rights may be listed on any national securities exchange, the
Company shall use its best efforts to cause, from and after such time as the
Rights become exercisable (but only to the extent that it is reasonably likely
that the Rights will be exercised), all shares reserved for such issuance to be
listed on such exchange upon official notice of issuance upon such exercise.
(c) The Company shall use its best efforts to
(i) file, as soon as practicable following the first occurrence of a Section
11(a)(ii) Event, or as soon as required by law, as the case may be, a
registration statement under the Securities Act of 1933, as amended (the "Act"),
with respect to the securities purchasable upon exercise of the Rights on an
appropriate form, (ii) cause such registration statement to become effective as
soon as practicable after such filing, and (iii) cause such registration
statement to remain effective (with a prospectus at all times meeting the
requirements of the Act) until the earlier of (A) the date as of which the
Rights are no longer exercisable for such securities, and (B) the Expiration
Date. The Company will also take such action as may be appropriate under the
blue sky laws of the various states. The Company may temporarily suspend, for a
period of time not to exceed ninety (90) days after the date set forth in clause
(i) of the first sentence of this Section 9(c), the exercisability of the Rights
in order to prepare and file such registration statement and permit it to become
effective. Upon any such suspension, the Company shall issue a public
announcement and shall give simultaneous written notice to the Rights Agent
stating that the exercisability of the Rights has been temporarily suspended, as
well as a public announcement and notice to the Rights Agent at such time as the
suspension is no longer in effect. Notwithstanding any provision of this
Agreement to the contrary, the Rights shall not be exercisable in any
jurisdiction unless the requisite qualifications in such jurisdiction shall have
been obtained.
(d) The Company covenants and agrees that it
will take all such action as may be necessary to ensure that all shares of
Common Stock (and following the occurrence of a Triggering Event, other
securities) delivered upon exercise of Rights shall, at the time of delivery of
the certificates for such shares (subject to payment of the Purchase Price), be
duly and validly authorized and issued and fully paid and nonassessable.
(e) The Company further covenants and agrees
that it will pay when due and payable any and all federal and state transfer
taxes and charges which may be payable in respect of the issuance or delivery of
the Right Certificates or of any shares of the Common Stock (or other
securities, as the case may be) upon the exercise of Rights. The Company shall
not, however, be required (a) to pay any transfer tax which may be payable in
respect of any transfer involved in the transfer or delivery of Right
Certificates or the issuance or delivery of certificates for Common Stock (or
other securities, as the case may be) in a name other than that of the
registered holder of the Right Certificate evidencing Rights surrendered for
exercise or (b) to issue or deliver any certificates for a number of shares of
Common Stock (or other securities, as the case may be) upon the exercise of any
Rights until any such tax shall have been paid (any such 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 tax is due.
Section 10. Common Stock Record Date. Each Person
in whose name any certificate for any number of shares of Common Stock (or other
securities, as the case may be) is issued upon the exercise of Rights shall for
all purposes be deemed to have become the holder of record of the shares of
Common Stock (or other securities, as the case may be) represented thereby on,
and such certificate shall be dated the date upon which the Right Certificate
evidencing such Rights was duly surrendered and payment of the Purchase Price
(and any applicable transfer taxes) was made and shall show the date of
countersignature; provided, however, that if the date of such surrender and
payment is a date upon which Common Stock (or other securities, as the case may
be) transfer books of the Company are closed, such Person shall be deemed to
have become the record holder of such shares on, and such certificate shall be
dated, the next succeeding Business Day on which the Common Stock (or other
securities, as the case may be) transfer books of the Company are open. Prior to
the exercise of the Rights evidenced thereby, the holder of a Right Certificate
shall not be entitled to any rights of a stockholder of the Company with respect
to shares for which the Rights shall be exercisable, including, without
limitation, the right to vote, to receive dividends or other distributions or to
exercise any preemptive rights, and shall not be entitled to receive any notice
of any proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price, Number of
Shares or Number of Rights. The Purchase Price, the number of shares covered by
each Right and the number of Rights outstanding are subject to adjustment from
time to time as provided in this Section 11.
(a) (i) In the event the Company shall at any
time after the date of this Agreement (A) declare a dividend on the Common Stock
payable in shares of the Common Stock, (B) subdivide the outstanding Common
Stock, (C) combine the outstanding Common Stock into a smaller number of shares
or (D) issue any shares of its capital stock in a reclassification of Common
Stock (including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing or surviving corporation), except
as otherwise provided in this Section 11(a) and Section 7(e) hereof, the
Purchase Price in effect at the time of the record date for such dividend or of
the effective date of such subdivision, combination or reclassification, and the
number and kind of shares of Common Stock or capital stock, as the case may be,
issuable on such date, shall be proportionately adjusted so that the holder of
any Right exercised after such time shall be entitled to receive, upon payment
of the Purchase Price then in effect, the aggregate number and kind of shares of
capital stock which, if such Right had been exercised immediately prior to such
date and at a time when Common Stock (or other securities) transfer books of the
Company were open, he or she would have owned upon such exercise and been
entitled to receive by virtue of such dividend, subdivision, combination or
reclassification. If an event occurs which would require an adjustment under
both this Section 11(a)(i) and Section 11(a)(ii), 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 24 of this
Agreement, in the event any Person, alone or together with its Affiliates and
Associates, becomes at any time after the Rights Dividend Declaration Date, an
Acquiring Person except as the result of a transaction set forth in Section
13(a) hereof, then, prior to the later of (x) the date on which the Company's
rights of redemption pursuant to Section 23(a) expire, or (y) five (5) days
after the date of the first occurrence of a Section 11(a)(ii) Event, proper
provision shall be made so that each holder of a Right, except as provided in
Section 7(e) hereof, shall thereafter have a right to receive, upon exercise
thereof at the then current Purchase Price in accordance with the terms of this
Agreement, such number of shares of Common Stock of the Company as shall equal
the result obtained by (x) multiplying the then current Purchase Price for a
full share of Common Stock by the number of shares of Common Stock for which a
Right is then exercisable and dividing that product by (y) 50% of the Current
Market Price per share of Common Stock of the Company (determined pursuant to
Section 11(d)) on the date of the occurrence of the event described above in
this subparagraph (ii) (such number of shares is hereinafter referred to as the
"Adjustment Shares"), provided that the Purchase Price and the number of
Adjustment Shares shall be further adjusted as provided in this Agreement to
reflect any events occurring after the date of such first occurrence.
(iii) If (x) the number of shares of Common
Stock which are authorized by the Company's certificate of incorporation but not
outstanding or reserved for issuance for purposes other than upon exercise of
the Rights is not sufficient to permit the exercise in full of the Rights in
accordance with the foregoing subparagraph (ii), or (y) any regulatory approvals
necessary for the issuance of such Common Stock have not been obtained by the
Company, or (z) the issuance of Common Stock of the Company shall not then be
permitted under the Company's certificate of incorporation or any applicable law
or administrative or judicial regulation or order, the Company shall (A)
determine the excess of (1) the value of the Adjustment Shares issuable upon the
exercise of a Right (the "Current Value") over (2) the Purchase Price (such
excess, the "Spread"), and (B) with respect to each Right, but subject to
Section 9 hereof and, if and to the extent required, to the receipt by the
Company of any necessary regulatory approvals, make adequate provision to
substitute for the Adjustment Shares, upon exercise of the Rights and payment of
the applicable Purchase Price, (1) cash, (2) a reduction in the Purchase Price,
(3) other equity securities of the Company (including, without limitation,
shares of preferred stock which the Board of Directors of the Company has deemed
to have the same value as shares of Common Stock (such shares of preferred
stock, "Common Stock Equivalents")), (4) debt securities of the Company, (5)
other assets, or (6) any combination of the foregoing, having an aggregate value
equal to the Current Value, where such aggregate value has been determined by
the Board of Directors of the Company based upon the advice of a nationally
recognized investment banking firm selected by the Board of Directors of the
Company; provided, however, that if the Company shall not have made adequate
provision to deliver value pursuant to clause (B) above within thirty (30) days
following the later of (x) the first occurrence of a Section 11(a)(ii) Event and
(y) the date on which the Company's rights of redemption pursuant to Section
23(a) expire (the later of (x) and (y) being referred to herein as the "Section
11(a)(ii) Trigger Date"), then the Company shall be obligated to deliver, upon
the surrender for exercise of a Right and without requiring payment of the
Purchase Price, shares of Common Stock (to the extent available and subject to
receipt by the Company of any necessary regulatory approvals) and then, if
necessary, cash, which shares and/or cash have an aggregate value equal to the
Spread. If the Board of Directors of the Company shall determine in good faith
that it is likely that sufficient additional shares of Common Stock could be
authorized for issuance upon exercise in full of the Rights and that any
necessary regulatory approvals for such issuance could be obtained, the thirty
(30) day period set forth above may be extended to the extent necessary, but not
more than ninety (90) days after the Section 11(a)(ii) Trigger Date, in order
that the Company may seek stockholder approval for the authorization of such
additional shares and/or regulatory approvals for the issuance of such
additional shares (such period, as it may be extended, the "Substitution
Period"). To the extent that the Company determines that some action need be
taken and/or additional regulatory approvals obtained pursuant to the first
and/or second sentences of this subparagraph (iii), the Company (x) shall
provide, subject to Section 7(e) hereof, that such action shall apply uniformly
to all outstanding Rights, and (y) may suspend the exercisability of the Rights
until the expiration of the Substitution Period in order to seek any
authorization of additional shares, to obtain any required regulatory approvals
and/or to decide the appropriate form of distribution to be made pursuant to
such first sentence and to determine the value thereof. In the event of any such
suspension, the Company shall issue a public announcement and shall give
concurrent written notice to the Rights Agent stating that the exercisability of
the Rights has been temporarily suspended, as well as a public announcement and
notice to the Rights Agent at such time as the suspension is no longer in
effect. ______ For purposes of this subparagraph (iii), the value of the Common
Stock shall be the Current Market Price (as determined pursuant to Section 11(d)
hereof) per share of Common Stock on the Section 11 (a) (ii) Trigger Date and
the value of any Common Stock Equivalent shall be deemed to be the same as the
value of Common Stock on such date. The Company shall give the Rights Agent
notice of the selection of any Common Stock Equivalent under this subparagraph
(iii).
(b) In case the Company shall fix a record date
for the issuance of rights, options or warrants to all holders of Common Stock
entitling them (for a period expiring within 45 calendar days after such record
date) to subscribe for or purchase Common Stock (or securities having
substantially the same rights, privileges and preferences as the shares of
Common Stock ("Equivalent Common Stock") or convertible into Common Stock or
Equivalent Common Stock) at a price per share of Common Stock or Equivalent
Common Stock (or having a conversion price per share, if a security convertible
into Common Stock or Equivalent Common Stock) less than the Current Market Price
(as defined in Section 11(d) per share of Common Stock or Equivalent Common
Stock, as the case may be) on such record date, the Purchase Price to be in
effect after such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a fraction, of which
the numerator shall be the number of shares of Common Stock outstanding on such
record date plus the number of shares of Common Stock or Equivalent Common Stock
which the aggregate offering price of the total number of shares of Common Stock
or Equivalent Common Stock so to be offered (and/or the aggregate initial
conversion price of the convertible securities so to be offered) would purchase
at such Current Market Price and of which the denominator shall be the number of
shares of Common Stock outstanding on such record date plus the number of
additional shares of Common Stock and/or Equivalent Common Stock to be offered
for subscription or purchase (or into which the convertible securities so to be
offered are initially convertible). In case such subscription price may be paid
by delivery of consideration part or all of which shall be in a form other than
cash, the value of such consideration shall be as determined in good faith by
the Board of Directors of the Company, whose determination shall be described in
a statement filed with the Rights Agent. Shares of Common Stock owned by or held
for the account of the Company shall not be deemed outstanding for the purpose
of any such computation. Such adjustment shall be made successively whenever
such a record date is fixed; and in the event that such rights, options or
warrants are not so issued, the Purchase Price shall be adjusted to be the
Purchase Price which would then be in effect if such record date had not been
fixed.
(c) In case the Company shall fix a record date
for the making of a distribution to all holders of Common Stock (including any
such distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation) of evidences of indebtedness
or assets (other than a regular periodic cash dividend or a dividend payable in
Common Stock) or subscription rights or warrants (excluding those referred to in
Section 11(b)), the Purchase Price to be in effect after such record date shall
be determined by multiplying the Purchase Price in effect immediately prior to
such record date by a fraction, of which the numerator shall be the Current
Market Price per share of Common Stock (as defined in Section 11(d)) on such
record date, less the fair market value (as determined in good faith by the
Board of Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent) of the portion of the assets or evidences
of indebtedness so to be distributed or of such subscription rights or warrants
applicable to one share of Common Stock and of which the denominator shall be
such Current Market Price per share of Common Stock. Such adjustments shall be
made successively whenever such a record date is fixed; and in the event that
such distribution is not so made, the Purchase Price shall again be adjusted to
be the Purchase Price which would then be in effect if such record date had not
been fixed.
(d) For the purpose of any computation
hereunder, other than computations made pursuant to Section 11(a)(iii), the
"Current Market Price" per share of Common Stock on any date shall be deemed to
be the average of the daily closing prices per share of such Common Stock for
the thirty (30) consecutive Trading Days (as such term is hereinafter defined in
this paragraph (d)) immediately prior to such date and, for purposes of
computations made pursuant to Section 11(a)(iii) hereof, the Current Market
Price per share of Common Stock on any date shall be deemed to be the average of
the daily closing prices per share of such Common Stock for the ten (10)
consecutive Trading Days immediately following such date; provided, however,
that in the event that the Current Market Price per share of Common Stock is
determined during the period following the announcement by the issuer of such
Common Stock of (A) a dividend or distribution on such Common Stock payable in
shares of such Common Stock or securities convertible into shares of such Common
Stock (other than the Rights) or (B) any subdivision, combination or
reclassification of such Common Stock, and prior to the expiration of the
requisite 30 Trading Day or 10 Trading Day period, as set forth above, after the
ex-dividend date for such dividend or distribution or the record date for such
subdivision, combination or reclassification, then, and in each such case, the
Current Market Price shall be appropriately adjusted to take into account
ex-dividend trading. The closing price for each day shall be the last sale
price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the shares of the Common Stock are not listed or admitted to trading on the
New York Stock Exchange, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal national
securities exchange on which the shares of the Common Stock are listed or
admitted to trading or, if the shares of the Common Stock are not listed or
admitted to trading on any national securities exchange, the last quoted price,
or, if not so quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by the National Association of Securities
Dealers, Inc. Automated Quotation System ("NASDAQ") or such other system then in
use, or, if on any such date the shares of Common Stock are not quoted by such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in Common Stock selected by the Board
of Directors of the Company. If on any such date no market maker is making a
market in the Common Stock, the fair value of such shares on such date shall be
as determined by the Board of Directors of the Company upon the advice of a
nationally-recognized, independent investment banking firm selected by the Board
of Directors, whose determination shall be described in a statement filed with
the Rights Agent and shall be conclusive for all purposes. The term "Trading
Day" shall mean a day on which the principal national securities exchange on
which the shares of Common Stock are listed or admitted to trading is open for
the transaction of business or, if the shares of Common Stock are not listed or
admitted to trading on any national securities exchange, a Monday, Tuesday,
Wednesday, Thursday or Friday on which banking institutions in the State of New
York are not authorized or obligated by law or executive order to close. If the
Common Stock is not publicly held or not so listed or traded, "Current Market
Price" per share shall mean the fair value per share as determined by the Board
of Directors of the Company upon the advice of a nationally-recognized,
independent investment banking firm selected by the Board of Directors, whose
determination shall be described in a statement filed with the Rights Agent and
shall be conclusive for all purposes.
(e) Anything herein to the contrary
notwithstanding, no adjustment in the Purchase Price shall be required unless
such adjustment would require an increase or decrease of at least 1% in such
price; provided, however, that any adjustments which by reason of this Section
11(e) are not required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under this Section 11
shall be made to the nearest cent or to the nearest ten-thousandth of a share of
Common Stock. Notwithstanding the first sentence of this Section 11(e), any
adjustment required by this Section 11 shall be made no later than the earlier
of (i) three years from the date of the transaction which mandates such
adjustment or (ii) the Expiration Date.
(f) If, as a result of an adjustment made
pursuant to Section 11(a) or Section 13(a), the holder of any Right thereafter
exercised shall become entitled to receive any shares of capital stock other
than shares of Common Stock, thereafter the number of such other shares so
receivable upon exercise of any Right and the Purchase Price thereof shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common Stock
contained in Section 11(a) through (p), inclusive, and the provisions of
Sections 7, 9, 10, 13 and 14 with respect to Common Stock shall apply on like
terms to any such other shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder shall evidence
the right to purchase, at the adjusted Purchase Price, the number of shares of
Common Stock purchasable from time to time hereunder upon exercise of the
Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its
election as provided in Section 11(i), upon each adjustment of the Purchase
Price as a result of the calculations made in Section 11(b) and (c), each Right
outstanding immediately prior to the making of such adjustment shall thereafter
evidence the right to purchase, at the adjusted Purchase Price, that number of
shares (calculated to the nearest tenth-thousandth) obtained by (i) multiplying
(x) the number of shares covered by a Right immediately prior to this adjustment
by (y) the Purchase Price in effect immediately prior to such adjustment of the
Purchase Price and (ii) dividing the product so obtained by the Purchase Price
in effect immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date
of any adjustment of the Purchase Price to adjust the number of Rights, in
substitution for any adjustment in the number of shares of Common Stock
purchasable upon the exercise of a Right. Each of the Rights outstanding after
such adjustment of the number of Rights shall be exercisable for the number of
shares of Common Stock for which a Right was exercisable immediately prior to
such adjustment. Each Right held of record prior to such adjustment of the
number of Rights shall become that number of Rights (calculated to the nearest
ten-thousandth) obtained by dividing the Purchase Price in effect immediately
prior to adjustment of the Purchase Price by the Purchase Price in effect
immediately after the adjustment of the Purchase Price. The Company shall make a
public announcement and shall give simultaneous written notice to the Rights
Agent of its election to adjust the number of Rights, indicating the record date
for the adjustment to be made. This record date may be the date on which the
Purchase Price is adjusted or any day thereafter, but, if the Right Certificates
have been issued, shall be at least 10 days later than the date of the public
announcement. If Right Certificates have been issued, upon each adjustment of
the number of Rights pursuant to this subparagraph (i), the Company shall, as
promptly as practicable, cause to be distributed to holders of Right
Certificates on such record date Right Certificates evidencing, subject to
Section 14, the additional Rights to which such holders shall be entitled as a
result of such adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment. Right Certificates so to be distributed shall be issued, executed
and countersigned in the manner provided for herein (and may bear, at the option
of the Company, the adjusted Purchase Price) and shall be registered in the
names of the holders of record of Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in
the Purchase Price or the number of shares of Common Stock issuable upon the
exercise of the Rights, the Right Certificates theretofore and thereafter issued
may continue to express the Purchase Price per share and the number of shares
which were expressed in the initial Right Certificates issued hereunder.
(k) Before taking any action that would cause
an adjustment reducing the Purchase Price below the then par value, if any, of a
share of Common Stock issuable upon exercise of the Rights, the Company shall
take any corporate action which may, in the opinion of its counsel, be necessary
in order that the Company may validly and legally issue such number of fully
paid and nonassessable shares of such Common Stock at such adjusted Purchase
Price.
(l) In any case in which this Section 11
shall require that an adjustment in the Purchase Price be made effective as of a
record date for a specified event, the Company may elect to defer until the
occurrence of such event the issuance to the holder of any Right exercised after
such record date of the number of shares of Common Stock and other capital stock
or securities of the Company, if any, issuable upon such exercise over and above
the number of shares of Common Stock and other capital stock or securities of
the Company, if any, issuable upon such exercise on the basis of the Purchase
Price in effect prior to such adjustment; provided, however, that the Company
shall deliver to such holder a due bill or other appropriate instrument
evidencing such holder's right to receive such additional shares upon the
occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such reductions in the
Purchase Price, in addition to those adjustments expressly required by this
Section 11, as and to the extent that the Board of Directors of the Company
shall determine to be advisable in order that any consolidation or subdivision
of shares of Common Stock, issuance wholly for cash of any shares of Common
Stock at less than the Current Market Price, issuance wholly for cash of the
Common Stock or securities which by their terms are convertible into or
exchangeable for Common Stock, stock dividends or issuance of rights, options or
warrants referred to hereinabove in this Section 11 hereafter made by the
Company to holders of its Common Stock shall not be taxable to such
stockholders.
(n) The Company covenants and agrees that,
after the Distribution Date, it will not, except as permitted by Sections 23, 24
and 27 hereof, take (nor will it permit any of its Subsidiaries to take) any
action if at the time such action is taken it is reasonably foreseeable that
such action will diminish substantially or otherwise eliminate the benefits
intended to be afforded by the Rights.
(o) The Company covenants and agrees that it
shall not, at any time after the Distribution Date, (i) consolidate with any
other Person (other than a Subsidiary of the Company in a transaction which
complies with Section 11(n)), (ii) merge with or into any other Person (other
than a Subsidiary of the Company in a transaction which complies with Section
11(n)), or (iii) sell or transfer (or permit any of its Subsidiaries to sell or
transfer), in one or more transactions, assets or earning power aggregating more
than 50% of the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any other Person or Persons (other than the Company and/or
any of its Subsidiaries in one or more transactions each of which complies with
Section 11(n)) if (x) at the time of or immediately after such consolidation,
merger or sale there are any rights, warrants or other instruments or securities
outstanding or agreements in effect which would substantially diminish or
otherwise eliminate the benefits intended to be afforded by the Rights or (y)
prior to, simultaneously with or immediately after such consolidation, merger or
sale, the stockholders of the Person who constitutes, or would constitute, the
"Principal Party" for purposes of Section 13(a) hereof shall have received a
distribution of Rights previously owned by such Person or any of its Affiliates
and Associates.
(p) Notwithstanding anything in this Agreement
to the contrary, prior to the Distribution Date, the Company may, in lieu of
making any adjustment to the Purchase Price, the number of shares of Common
Stock eligible for purchase on exercise of each Right or the number of Rights
outstanding, which adjustment would otherwise be required by Section 11(a)(i),
11(b), 11(c), 11(h) or 11(i), make such other equitable adjustment or
adjustments thereto as the Board of Directors (whose determination shall be
conclusive) deems appropriate in the circumstances and not inconsistent with the
objectives of the Board of Directors in adopting this Agreement and such
Sections.
Section 12. Certificate of Adjusted Purchase Price or
Number of Shares. Whenever an adjustment is made as provided in Sections 11 and
13, the Company shall (a) promptly prepare a certificate setting forth such
adjustment, a brief statement of the facts accounting for such adjustment and
the adjusted Purchase Price, (b) promptly file with the Rights Agent and with
each transfer agent for the Common Stock a copy of such certificate and (c) mail
a brief summary thereof to each holder of a Right Certificate in accordance with
Section 26. The Rights Agent shall be fully protected in relying on any such
certificate and on any adjustment therein contained.
Section 13. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power. (a) In the event that, following the Shares
Acquisition Date, directly or indirectly, (x) the Company shall consolidate
with, or merge with or into, any other Person (other than a Subsidiary of the
Company in a transaction which complies with Section 11(n)) and the Company
shall not be the continuing or surviving corporation of such consolidation or
merger, (y) any Person (other than a Subsidiary of the Company in a transaction
which complies with Section 11(n)) shall consolidate, merge with or into the
Company and the Company shall be the continuing or surviving corporation of such
consolidation or merger and in connection with such consolidation or merger, all
or part of the Common Stock shall be changed into or exchanged for stock or
other securities of any other Person or cash or any other property, or (z) the
Company shall sell or otherwise transfer (or one or more of its Subsidiaries
shall sell or otherwise transfer), in one or more transactions, assets or
earning power aggregating more than 50% of the assets or earning power of the
Company and its Subsidiaries (taken as a whole) to any other Person or Persons
(other than the Company or any of its Subsidiaries in one or more transactions
each of which complies with Section 11(n) hereof), then, and in each such case,
proper provision shall be made so that (i) each holder of a Right (except as
provided in Section 7(e)) shall thereafter have the right to receive, upon the
exercise thereof at the then current Purchase Price in accordance with the terms
of this Agreement, such number of validly issued, fully paid, nonassessable and
freely tradable shares of Common Stock of the Principal Party (as hereinafter
defined) , not subject to any liens, encumbrances, rights of call or first
refusal, or other adverse claims as shall be equal to the result obtained by (1)
multiplying the then current Purchase Price for a full share of Common Stock by
the number of shares of Common Stock for which a Right is exercisable
immediately prior to the first occurrence of a Section 13 Event (or, if a
Section 11(a) (ii) Event has occurred prior to the first occurrence of a Section
13 Event, multiplying the number of such shares for which a Right was
exercisable immediately prior to the first occurrence of a Section 11(a) (ii)
Event by the Purchase Price for a full share of Common Stock in effect
immediately prior to such first occurrence), and dividing that product (which,
following the first occurrence of a Section 13 Event, shall be referred to as
the "Purchase Price" for each Right and for all purposes of this Agreement) by
(2) 50% of the Current Market Price per share of the Common Stock of such
Principal Party (determined in the manner described in Section 11 (d) ) on the
date of consummation of such consolidation, merger, sale or transfer; (ii) the
Principal Party shall thereafter be liable for, and shall assume, by virtue of
such Section 13 Event, all the obligations and duties of the Company pursuant to
this Agreement; (iii) the term "Company" shall thereafter be deemed to refer to
such Principal Party, it being specifically intended that the provisions of
Section 11 shall thereafter apply 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 Section 9) 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 the shares of its Common Stock thereafter deliverable upon
the exercise of the Rights, and (v) the provisions of Section 11(a)(ii) hereof
shall be of no effect following the first occurrence of any Section 13 Event.
(b) "Principal Party" shall mean
(1) in the case of any transaction
described in (x) or (y) of the first sentence of Section 13(a), the Person
that is the issuer of any securities into which shares of Common Stock of the
Company are converted in such merger or consolidation and, if no securities are
so issued, the Person that is the other party to the merger or consolidation;
and
(2) 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; provided, however, that in any
such case, (x) 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 corporation the Common Stock of which is and has been so
registered, "Principal Party" shall refer to such other corporation and (y) if
such Person is a Subsidiary, directly or indirectly, of more than one
corporation, the Common Stocks of two or more of which are and have been so
registered, "Principal Party" shall refer to whichever of such corporations is
the issuer of the Common Stock having the greatest market value.
(3) The Company shall not consummate
any Section 13 Event unless the Principal Party shall have a sufficient number
of authorized shares of its Common Stock which are neither outstanding nor
reserved for issuance to permit the exercise in full of the Rights in accordance
with this Section 13 and unless prior thereto the Company and such Principal
Party shall have executed and delivered to the Rights Agent a supplemental
agreement providing for the terms set forth in paragraphs (a) and (b) of this
Section 13 and further providing that, as soon as practicable after the date of
any consolidation, merger or sale of assets mentioned in paragraph (a) of this
Section 13, the Principal Party
(i) will prepare and file a
registration statement under the Act with respect to the Rights and the
securities purchasable upon exercise of the Rights on an appropriate form, will
use its best efforts to cause such registration statement to become effective as
soon as practicable after such filing and will use its best efforts to cause
such registration statement to remain effective (with a prospectus at all times
meeting the requirements of the Act) until the Expiration Date; and
(ii) will deliver to holders
of the Rights historical financial statements for the Principal Party and each
of its Affiliates which comply in all respects with the requirements for
registration on Form 10 under the Exchange Act.
The provisions of this Section 13 shall similarly apply to successive Section 13
Events. In the event that a Section 13 Event shall occur at any time after the
occurrence of a Section 11(a)(ii) Event, the Rights which have not theretofore
been exercised shall thereafter become exercisable in the manner described in
Section 13(a).
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. In lieu of such
fractional Rights, the Company shall pay to the registered holders of the Right
Certificates with regard to which such fractional Rights would otherwise be
issuable an amount in cash equal to the same fraction of the current market
value of a whole Right. For the purposes of this Section 14(a), the current
market value of a whole Right shall be the closing price of the Rights for the
Trading Day immediately prior to the date on which such fractional Rights would
have been otherwise issuable. The closing price for any day shall be the last
sale price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the Rights are not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the Rights are listed or admitted to trading or, if the Rights are not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by NASDAQ or such other
system then in use, or, if on any such date the Rights are not quoted by any
such organization, the average of the closing bid and asked prices as furnished
by a professional market maker making a market in the Rights selected by the
Board of Directors of the Company. If on any such date no such market maker is
making a market in the Rights, the fair value of the Rights on such date, as
determined in good faith by the Board of Directors of the Company, shall be
used.
(b) The Company shall not be required to issue
fractions of shares of Common Stock or Common Stock Equivalents upon exercise or
exchange of the Rights or to distribute certificates which evidence fractional
shares. In lieu of fractional shares of Common Stock or Common Stock
Equivalents, the Company may pay to the registered holders of Right Certificates
at the time the Rights evidenced thereby are exercised or exchanged as herein
provided an amount in cash equal to the same fraction of the current market
value of Common Stock or Common Stock Equivalents. For purposes of this Section
14(b), the current market value of one share of Common Stock shall be the
closing price of a share of Common Stock (as determined pursuant to Section
11(d)) for the Trading Day immediately prior to the date of such exercise or
exchange, as the case may be, and the current market value of any Common Stock
Equivalent shall be the same as the current market value of the Common Stock on
such date.
(c) The holder of a Right by the acceptance of
the Right expressly waives his right to receive any fractional Rights or any
fractional shares upon exercise or exchange of a Right, except as otherwise
permitted by this Section 14.
Section 15. Rights of Action. All rights of action
in respect of this Agreement are vested in the respective registered holders of
the Right Certificates (and, prior to the Distribution Date, the registered
holders of the Common Stock); and any registered holder 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 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 Agreement. Without limiting the
foregoing or any remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and will be entitled to specific performance of
the obligations hereunder and injunctive relief against actual or threatened
violations of the obligations hereunder of any Person subject to this Agreement.
Section 16. Agreement of Right Holders. Every holder
of a Right by accepting the same consents and agrees with the Company and the
Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights
will be transferable only in connection with the transfer of the Common Stock;
(b) after the Distribution Date, the Right
Certificates will be 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 with the
appropriate forms and certificates fully executed, along with a signature
guarantee and such other and further documentation as the Rights Agent may
reasonably request;
(c) subject to Section 6 and Section 7(f)
hereof, 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
whatever, and neither the Company nor the Rights Agent shall be affected by
any notice to the contrary;
(d) notwithstanding anything in this Agreement
to the contrary, neither the Company nor the Rights Agent shall have any
liability to any holder of a Right or other Person as a result of its inability
to perform any of its obligations under this Agreement by reason of any
preliminary or permanent injunction or other order, decree or ruling issued by a
court of competent jurisdiction or by a governmental, regulatory or
administrative agency or commission, or any statute, rule, regulation or
executive order promulgated or enacted by any governmental authority,
prohibiting or otherwise restraining performance of such obligation; provided,
however, that the Company must use its best efforts to have any such order,
decree or ruling lifted or otherwise overturned as soon as possible.
Section 17. Right Certificate Holder Not Deemed a
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 the number
of shares of Common Stock or any other securities of the Company that may at any
time be issuable on the exercise of the Rights represented thereby, nor shall
anything contained herein or in any Right Certificate be construed to confer
upon the holder of any Right Certificate, as such, any of the rights of a
stockholder of the Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of meetings or
other actions affecting stockholders (except as provided in Section 25), or to
receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Right Certificate shall have been exercised or
exchanged for Common Stock in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent. The
agreements set forth in this Section 18 shall survive termination of the
Agreement and the payments of all amounts hereunder. The Company agrees to pay
to the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and other disbursements incurred in the administration
and execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent for, and to
hold it harmless against, any loss, liability or expense, incurred without
negligence, bad faith or willful misconduct on the part of the Rights Agent
(including the reasonable fees and expenses of counsel), for anything done or
omitted by the Rights Agent in connection with the acceptance and administration
of this Agreement, including the costs and expenses of defending against any
claim of liability in the premises.
The Rights Agent shall be protected and shall incur
no liability for or in respect of any action taken, suffered or omitted by
it in connection with its administration of this Agreement in reliance upon any
Right Certificate or certificate for Common Stock or other securities of the
Company, instrument of assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, direction, consent, instruction, adjustment notice,
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.
In addition to the foregoing, the Rights Agent shall
be protected and shall incur no liability for, or in respect of, any action
taken or omitted by it in connection with its administration of this Agreement
in reliance upon (i) the proper execution of the certification appended to the
Form of Assignment and the Form of Election to Purchase included as part of
Exhibit B hereto (the "Certification"), unless the Rights Agent shall have
actual knowledge that, as executed, the Certification is untrue or (ii) the
non-execution or failure to complete the Certification including, without
limitation, any refusal to honor any otherwise permissible assignment or
election by reason of such nonexecution or failure.
Section 19. Merger or Consolidation or Change of Name
of Rights Agent. Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights Agent
or any successor Rights Agent shall be a party, or any corporation succeeding to
the corporate trust business of the Rights Agent or any successor Rights Agent,
shall be the successor to the Rights Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation would be eligible for appointment
as a successor Rights Agent under the provisions of Section 21. In case at the
time such successor Rights Agent shall succeed to the agency created by this
Agreement, any of the Right Certificates shall have been countersigned but not
delivered, any such successor Rights Agent may adopt the countersignature of the
predecessor so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Right Certificates either in the name of the predecessor Rights
Agent or in the name of the successor Rights Agent; and in all such cases such
Right Certificates shall have the full force provided in the Right Certificates
and in this Agreement.
In case at any time the name of the Rights Agent shall
be changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Right Certificates so
countersigned; and in case at that time any of the Right Certificates shall
not have been countersigned, the Rights Agent may countersign such Right
Certificates either in its prior name or in its changed name; and in
all such cases such Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this Agreement upon the
following terms and conditions, by all of which the Company and the holders of
Right Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal
counsel (who may be legal counsel for the Company), and the opinion of such
counsel shall be full and complete authorization and protection to the Rights
Agent as to any action taken or omitted by it in good faith and in accordance
with such opinion.
(b) Whenever in the performance of its duties
under this Agreement the Rights Agent shall deem it necessary or desirable that
any fact or matter 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 any one of the
Chairman of the Board, the President, any Senior Vice President, any Vice
President, the Treasurer or the Secretary of the Company and delivered to the
Rights Agent; and such certificate shall be full authorization to the Rights
Agent for any action taken or suffered in good faith by it under the provisions
of this Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder
only for its own negligence, bad faith or willful misconduct. The issuance or
non-issuance of a Right Certificate or Common Stock or other security issued in
lieu of Common Stock in accordance with instructions given to the Rights Agent
by the Company pursuant to Section 20(k) hereof or in accordance with the terms
hereof shall not constitute negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or
by reason of any of the statements of fact or recitals contained in this
Agreement or in the Right Certificates (except its countersignature thereof) or
be required to verify the same, but all such statements and recitals are and
shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or the execution and
delivery hereof (except the due execution hereof by the Rights Agent) or in
respect of the validity or execution of any Right Certificate (except its
countersignature thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement or in any Right
Certificate; nor shall it be responsible for any adjustment required under the
provisions of Section 11 or 13 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 actual notice of any such adjustment); nor
shall it by any act hereunder be deemed to make any representation or warranty
as to the authorization or reservation of any shares of Common Stock to be
issued pursuant to this Agreement or any Right Certificate or as to whether any
shares of Common 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 this Agreement.
(g) The Rights Agent is hereby authorized and
directed to accept instructions with respect to the performance of its duties
hereunder and certificates delivered pursuant to any provision hereof from any
one of the Chairman of the Board, the President, any Senior Vice President, any
Vice President, the Secretary or the Treasurer of the Company, and is authorized
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. An
application by the Rights Agent for instructions may set forth in writing any
action proposed to be taken or omitted by the Rights Agent with respect to its
duties and obligations under this Agreement and the date on and/or after which
such action shall be taken, and the Rights Agent shall not be liable for any
action taken or omitted in accordance with a proposal included in any such
application on or after the date specified therein (which date shall not be less
than one Business Day after the Company receives such application) without the
consent of the Company unless, prior to taking or omitting such action, the
Rights Agent has received written instructions in response to an application
specifying the actions to be taken or omitted.
(h) The Rights Agent and any stockholder,
director, officer or employee of the Rights Agent may buy, sell or deal in any
of the Rights or other securities of the Company or become pecuniarily
interested in any transaction in which the Company may be interested, or
contract with or lend money to the Company, or otherwise act as fully and freely
as though it were not Rights Agent under this Agreement. Nothing herein shall
preclude the Rights Agent from acting in any other capacity for the Company or
for any other legal entity.
(i) The Rights Agent may execute and exercise
any of the rights or powers hereby vested in it or perform any duty hereunder
either by itself or by or through its attorneys or agents, and the Rights Agent
shall not be answerable or accountable for any act, default, neglect or
misconduct of any such attorneys or agents or for any loss to the Company
resulting from any such act, default, neglect or misconduct; provided, however,
that reasonable care was exercised in the selection thereof.
(j) No provision of this Agreement shall
require the Rights Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or in the
exercise of its rights if there shall be reasonable grounds for believing that
repayment of such funds or adequate indemnification against such risk or
liability is not reasonably assured to it.
(k) If, with respect to any Right Certificate
surrendered to the Rights Agent for exercise or transfer, the certificate
attached to the form of assignment or form of election to purchase, as the case
may be, either has not been completed or does not indicate an affirmative
response, the Rights Agent shall not take any further action with respect to
such requested exercise or transfer without first consulting the Company. The
Company shall give the Rights Agent prompt written instructions as to the action
to be taken regarding the Right Certificates involved. The Rights Agent shall
not be liable for acting in accordance with such instructions.
Section 21. Change of Rights Agent. The Rights Agent
or any successor Rights Agent may resign and be discharged from its duties under
this Agreement upon thirty (30) days' notice in writing mailed to the Company by
registered or certified mail, and, at the Company's expense, to the holders of
the Right Certificates by first class mail. The Company may remove the Rights
Agent or any successor Rights Agent upon thirty (30) days' notice in writing,
mailed to the Rights Agent or successor Rights Agent, as the case may be, and to
each transfer agent of the Common Stock by registered or certified mail, and to
the holders of the Right Certificates by first-class mail. If the Rights Agent
shall resign or be removed or shall otherwise become incapable of acting, the
Company shall appoint a successor to the Rights Agent. If the Company shall fail
to make such appointment within a period of thirty (30) days after giving notice
of such removal or after it has been notified in writing of such resignation or
incapacity by the resigning or incapacitated Rights Agent or by the holder of a
Right Certificate (who shall, with such notice, submit his Right Certificate for
inspection by the Company), then the Company shall become the temporary Rights
Agent and the registered holder of any Right Certificate may apply to any court
of competent jurisdiction for the appointment of a new Rights Agent. Any
successor Rights Agent, whether appointed by the Company or by such a court,
shall be a corporation organized and doing business under the laws of the United
States or of the State of New York (or of any other state of the United States
so long as such corporation is authorized to do business as a banking
institution in the State of New York), in good standing, having a principal
office in the State of New York, which is authorized under such laws to exercise
corporate trust powers, is subject to supervision or examination by federal or
state authority, and has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $25 million. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall deliver and transfer
to the successor Rights Agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose. Not later than the effective date of any such appointment the
Company shall file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common Stock, and 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.
Precedessor Rights Agent shall be released and discharged from any and all
further responsibility incurred after its termination as Rights Agent.
Section 22. Issuance of New Right Certificates.
Notwithstanding any of the provisions of this Agreement or of the Rights to the
contrary, the Company may, at its option, issue new Right Certificates
evidencing Rights in such form as may be approved by its Board of Directors to
reflect any adjustment or change in the Purchase Price and the number or kind or
class of shares or other securities or property purchasable under the Right
Certificates made in accordance with the provisions of this Agreement. In
addition, in connection with the issuance or sale of shares of Common Stock
following the Distribution Date and prior to the redemption or expiration of the
Rights, the Company (a) shall, with respect to shares of Common Stock so issued
or sold pursuant to the exercise of stock options or under any employee plan or
arrangement, or upon the exercise, conversion or exchange of securities
hereinafter issued by the Company, and (b) may, in any other case, if deemed
necessary or appropriate by the Board of Directors of the Company, issue Right
Certificates representing the appropriate number of Rights in connection with
such issuance or sale; provided, however, that (i) no such Right Certificate
shall be issued if, and to the extent that, the Company shall be advised by
counsel that such issuance would create a significant risk of material adverse
tax consequences to the Company or the Person to whom such Right Certificate
would be issued, and (ii) no such Right Certificate shall be issued if, and to
the extent that, appropriate adjustment shall otherwise have been made in lieu
of the issuance thereof.
Section 23. Redemption and Termination. (a) The
Board of Directors of the Company, upon the affirmative vote of three-fourths of
the entire Board of Directors, may, at its option, at any time prior to the
earlier of (x) the close of business on the tenth day following the Shares
Acquisition Date (or if the Shares Acquisition Date shall have occurred prior to
the Record Date, the close of business on the tenth day following the Record
Date), or (y) the Final Expiration Date, redeem all but not less than all of the
then outstanding Rights at a redemption price of $.01 per Right as appropriately
adjusted to reflect any stock split, stock dividend or similar transaction
occurring after the date hereof (such redemption price being hereinafter
referred to as the "Redemption Price"), and the Company may, at its option, pay
the Redemption Price either in shares of its Common Stock (valued at their
Current Market Price as defined in Section 11(d) on the date of the redemption),
other securities, cash or other assets. Notwithstanding anything contained in
this Agreement to the contrary, the Rights shall not be exercisable after the
first occurrence of a Section 11(a)(ii) Event until such time as the Company's
right of redemption hereunder has expired.
(b) In deciding whether or not to exercise the
Company's right of redemption hereunder, the Board of Directors of the Company
shall act in good faith, in a manner they reasonably believe to be in the best
interests of the Company and with such care, including reasonable inquiry, skill
and diligence, as a person of ordinary prudence would use under similar
circumstances, and they may consider the long-term and short-term effects of any
action upon employees, customers and creditors of the Company and upon
communities in which offices or other establishments of the Company are located,
and all other pertinent factors.
(c) Immediately upon the action of the Board
of Directors of the Company ordering the redemption of the Rights, and without
any further action and without any notice, the right to exercise the Rights will
terminate and the only right thereafter of the holders of Rights shall be to
receive the Redemption Price for each Right held. Within 10 days after the
action of the Board of Directors ordering the redemption of the Rights, the
Company shall give notice of such redemption to the holders of the then
outstanding Rights by mailing such notice to the Rights Agent and 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 such notice of redemption will state the method by which the
payment of the Redemption Price will be made. Neither the Company nor any of its
Affiliates or Associates may redeem, acquire or purchase for value any Rights at
any time in any manner other than that specifically set forth in this Section
23, and other than in connection with the repurchase of Common Stock prior to
the Distribution Date.
Section 24. Exchange. (a) The Board of Directors of
the Company, upon the affirmative vote of three-fourths of the entire Board of
Directors, may, at its option but subject to the receipt by the Company of any
required regulatory approvals, at any time and from time to time on or after a
Section 11(a)(ii) Event, 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 of Common Stock per Right, appropriately adjusted
to reflect any stock split, stock dividend or similar transaction occurring
after the date of this Agreement (such exchange ratio being hereinafter referred
to as the "Exchange Ratio").
(b) Immediately upon the action of the Board of
Directors of the Company ordering the exchange of any Rights pursuant to
subsection (a) of this Section 24 and without any further action and without any
notice, the right to exercise such Rights shall terminate and the only right
thereafter of a holder of such Rights shall be to receive that number of shares
of Common Stock equal to the number of such Rights held by such holder
multiplied by the Exchange Ratio. The Company shall promptly give public notice
of any such exchange; provided, however, that the failure to give, or any defect
in, such notice shall not affect the validity of such exchange. The Company
promptly shall mail a notice of any such exchange to all of the holders of such
Rights at their last addresses as they appear upon the registry books of the
Rights Agent. Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each such notice of
exchange will state the method by which the exchange will be effected and, in
the event of any partial exchange, the number of Rights which will be exchanged.
Any partial exchange shall be effected pro rata based on the number of Rights
(other than Rights which have become void pursuant to the provisions of Section
7(e) hereof) held by each holder of Rights.
(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 24, the Company shall take all such action as may be necessary to
authorize additional shares of Common Stock or for issuance upon exchange of the
Rights, subject, however, to Section 24(d) hereof.
(d) In any exchange pursuant to this Section 24,
the Company, at its option but subject to the receipt by the Company of any
required regulatory approvals, may substitute for any share of Common Stock
exchangeable for a Right (i) Common Stock Equivalents, (ii) cash, (iii) debt
securities of the Company, (iv) other assets, or (v) any combination of the
foregoing, having an aggregate value which three-fourths of the entire Board of
Directors of the Company shall have determined in good faith to be equal to the
Current Market Price of one share of Common Stock (determined pursuant to
Section 11(d) hereof) on the Trading Day immediately preceding the date of
exchange pursuant to this Section 24.
Section 25. Notice of Certain Events. In case the
Company shall propose at any time following the Distribution Date (a) to pay any
dividend payable in stock of any class to the holders of Common Stock or to make
any other distribution to the holders of Common Stock (other than a regular
periodic cash dividend), or (b) to offer to the holders of Common Stock rights
or warrants to subscribe for or to purchase any additional shares of Common
Stock or shares of stock of any class or any other securities, rights or
options, or (c) to effect any reclassification of Common Stock (other than a
reclassification involving only the subdivision of outstanding Common Stock), or
(d) to effect any consolidation or merger into or with any other Person (other
than a Subsidiary of the Company in a transaction which complies with Section
11(n) hereof), or to effect any sale or other transfer (or to permit one or more
of its Subsidiaries to effect any sale or other transfer), in one 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 (other than
the Company and/or any of its Subsidiaries in one or more transactions each of
which complies with Section 11(n) hereof), or (e) to effect the liquidation,
dissolution or winding up of the Company, then, in each such case, the Company
shall give to the Rights Agent and to each holder of a Right, in accordance with
Section 26, a notice of such proposed action, which shall specify the record
date for the purposes of such stock dividend, distribution of rights or Rights,
or the date on which such reclassification, consolidation, merger, sale,
transfer, liquidation, dissolution, or winding up is to take place and the date
of participation therein by the holders of the Common 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 (a) or (b) above at least twenty (20) days prior to the record date
for determining holders of the Common Stock for purposes of such action, and in
the case of any such other action, at least twenty (20)) days prior to the date
of the taking of such proposed action or the date of participation therein by
the holders of the Common Stock, whichever shall be the earlier.
In case a Section 11(a)(ii) Event shall occur, then,
in any such case, the Company shall as soon as practicable thereafter give to
the Rights Agent and to each holder of a Right, to the extent feasible and in
accordance with Section 26 a notice of the occurrence of such event, which shall
specify the event and the consequences of the event to holders of Rights under
Section 11(a)(ii).
Section 26. Notices. Notices or demands authorized
by this Agreement to be given or made by the Rights Agent or by the holder of
any Right Certificate to or on the Company shall be sufficiently given or made
if sent by first-class mail, postage prepaid, addressed (unless and until
another address is filed in writing with the Rights Agent) as follows:
National Fuel Gas Company
10 Lafayette Square
Buffalo, New York 14203
Attention: Corporate Secretary
Subject to the provisions of Section 21, any notice or demand authorized by
this Agreement to be given or made by the Company or by the holder of any Right
Certificate to or on the Rights Agent shall be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed (until another address is
filed in writing with the Company) as follows:
Marine Midland Bank
140 Broadway
12th Floor
Corporate Trust Services
New York, New York 10005-1180
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company.
Section 27. Supplements and Amendments. Prior to the
earlier of the Distribution Date or the Shares Acquisition Date and subject to
the penultimate sentence of this Section 27, the Company may from time to time
supplement or amend this Agreement in writing without the approval of any
holders of Right Certificates; provided that any such supplement or amendment
shall have been approved by the affirmative vote of three-fourths of the entire
Board of Directors. From and after the earlier of the Distribution Date or the
Shares Acquisition Date, and subject to the penultimate sentence of this Section
27, the Company, pursuant to a like three-fourths vote of its Board of
Directors, may from time to time supplement or amend this Agreement in writing
without the approval of any holders of Right Certificates in order (i) to cure
any ambiguity, (ii) to correct or supplement any provision contained herein
which may be defective or inconsistent with any other provisions herein, (iii)
to lengthen the time period during which the Rights may be redeemed following
the Shares Acquisition Date for up to an additional twenty days beyond the time
period set forth in Section 23 (a), or (iv) to change or supplement the
provisions hereunder in any manner which the Company may deem necessary or
desirable and which shall not adversely affect the interests of the holders of
Right Certificates (other than an Acquiring Person or an Affiliate or Associate
of an Acquiring Person). Upon the delivery of a certificate from an appropriate
officer of the Company which states that the proposed supplement or amendment is
in compliance with the terms of this Section 27, the Rights Agent shall execute
such supplement or amendment unless the Rights Agent shall have determined in
good faith that such supplement or amendment would adversely affect its
interests under this Agreement. Notwithstanding anything in this Agreement to
the contrary, no supplement or amendment shall be made on or after the
Distribution Date which changes the Redemption Price, the Final Expiration Date,
the Purchase Price or the number of shares of Common Stock for which a Right is
then exercisable. Prior to the earlier of the Shares Acquisition Date or the
Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Common Stock.
Section 28. Successors. All the covenants and
provisions of this Agreement by or for the benefit of the Company or the Rights
Agent shall bind and inure to the benefit of their respective successors and
assigns hereunder.
Section 29. Determinations and Actions by the Board
of Directors. For all purposes of this Agreement, any calculation of the number
of shares of Common Stock outstanding at any particular time, including for
purposes of determining the particular percentage of such outstanding shares of
Common Stock of which any Person is the Beneficial owner, shall be made in
accordance with the provisions of Rule 13d-3(d)(1)(i) of the General Rules and
Regulations under the Exchange Act. The Board of Directors of the Company shall
have the exclusive power and authority to administer this Agreement and to
exercise all rights and powers specifically granted to the Board or the Company,
or as may be necessary or advisable in the administration of this Agreement,
including, without limitation, the right and power to (i) interpret the
provisions of this Agreement, and (ii) make all determinations deemed necessary
or advisable for the administration of this Agreement (including a determination
to redeem or not redeem the Rights or to amend the Agreement); and, where
specifically prescribed herein, such Board actions, calculations,
interpretations and determinations shall be undertaken or made only pursuant to
the affirmative vote of three-fourths of the entire Board of Directors. All such
actions, calculations, interpretations and determinations (including, for the
purpose of clause (ii) below, all omissions with respect to the foregoing) which
are done or made by the Board in good faith, shall (i) be final, conclusive and
binding on the Company, the Rights Agent, the holders of the Right Certificates
and all other parties, and (ii) not subject the Board to any liability to the
holders of the Right Certificates.
Section 30. Benefits of This Agreement. Nothing in
this Agreement shall be construed to give to any Person other than the Company,
the Rights Agent and the registered holders of the Right Certificates (and,
prior to the Distribution Date, the Common Stock) any legal or equitable right,
remedy or claim under this Agreement; but this Agreement shall be for the sole
and exclusive benefit of the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date,
registered holders of the Common Stock).
Section 31. Severability. If any term, provision,
covenant, or restriction of this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated; provided, however, that notwithstanding anything in this
Agreement to the contrary, if any such term, provision, covenant or restriction
is held by such court or authority to be invalid, void or unenforceable and the
Board of Directors of the Company determines in its good faith judgment that
severing the invalid language from this Agreement would adversely affect the
purpose or effect of this Agreement, the right of redemption set forth in
Section 23, hereof, if then expired, shall be reinstated and shall not expire
until the close of business on the tenth day following the date of such
determination by the Board of Directors.
Section 32. Governing Law. This Agreement 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 in accordance with the laws of such State applicable to contracts to
be made and performed entirely within such State. Notwithstanding anything to
the contrary contained herein, any dispute regarding the carrying out of its
obligations hereunder by the Rights Agent shall be governed by the laws of New
York.
Section 33. Counterparts. This Agreement may be
executed in any number of counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such counterparts shall
together constitute but one and the same instrument.
Section 34. Descriptive Headings. Descriptive
headings of the several Sections of this Agreement are inserted for convenience
only and shall not control or affect the meaning or construction of any of the
provisions hereof.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
[SEAL]
NATIONAL FUEL GAS COMPANY
By:_______________________________
Name: Philip C. Ackerman
Title: Senior Vice President
Attest:
By:
-------------------------------
Name:
--------------------------
Title:
-------------------------
[SEAL]
MARINE MIDLAND BANK
By:_______________________________
Name:
Title:
Attest:
By:
-------------------------------
Name:
--------------------------
Title:
-------------------------
<PAGE>
EXHIBIT A
[Form of Right Certificate]
Certificate No. R- Rights
-------
NOT EXERCISABLE AFTER JULY 31, 2008 OR EARLIER IF NOTICE OF REDEMPTION OR
EXCHANGE IS GIVEN. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE
COMPANY, AT $.01 PER RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, RIGHTS MAY NOT BE EXERCISABLE AND THE
RIGHTS AGREEMENT MAY BE AMENDED WITHOUT THE APPROVAL OF THE RIGHTS OWNERS.
NATIONAL FUEL GAS COMPANY
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 June 12, 1996, as the same may from time to time be
amended in accordance with its terms (as amended, the "Rights Agreement")
between National Fuel Gas Company, a New Jersey corporation (the "Company") and
_______________________ (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. (Buffalo, New York time) on July 31, 2008 at
the designated office of the Rights Agent, or its successors as Rights Agent, in
_____________, New York, one-half of one fully paid, nonassessable share of the
Common Stock, $1.00 par value (the "Common Stock"), of the Company, at a
purchase price of $130.00 per share (the "Purchase Price"), being $65.00 per
half share, upon presentation and surrender of this Right Certificate with the
Form of Election to Purchase and related certificate duly executed, along with a
signature guarantee and such other and further documentation as the Rights Agent
may reasonably request. The number of Rights evidenced by this Right Certificate
(and the number of shares which may be purchased upon exercise thereof) set
forth above, and the Purchase Price per share set forth above, are the number
and Purchase Price as of ________________ 1996, based on the Common Stock of the
Company as constituted at such date.
Upon the occurrence of a Section 11(a)(ii) Event (as such term is
defined in the Rights Agreement), if the Rights evidenced by this Right
Certificate are beneficially owned by (i) an Acquiring Person or an Affiliate or
Associate of any such Acquiring Person (as such terms are defined in the Rights
Agreement) , (ii) a transferee of any such Acquiring Person, Associate or
Affiliate, or (iii) under certain circumstances specified in the Rights
Agreement, a transferee of a person who after such transfer, became an Acquiring
Person, such Rights shall become null and void and no holder hereof shall have
any right with respect to such Rights from and after the occurrence of such
Section 11(a)(ii) Event.
As provided in the Rights Agreement, the Purchase Price and the
number and kind of shares of Common Stock (or, in certain circumstances, other
securities) 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, including Triggering Events (as such term is
defined 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 hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the Rights Agreement are on file at the above-mentioned office of the Rights
Agent, and at the executive offices of the Company.
This Right Certificate, with or without other Right Certificates,
upon surrender at the designated office of the Rights Agent, along with a
signature guarantee and such other and further documentation as the Rights Agent
may reasonably request, may be exchanged for another Right Certificate or Right
Certificates of like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of shares of Common 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, along
with a signature guarantee and such other and further documentation as the
Rights Agent may reasonably request, 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 (a) may be redeemed by the Company at its option
at a redemption price of $.01 per Right prior to the earlier of the close of
business on (i) the tenth day following the Shares Acquisition Date and (ii) the
Final Expiration Date or (b) may be exchanged in whole or in part for shares of
Common Stock and/or other securities, cash or other assets of the Company deemed
to have the same value as shares of Common Stock, at any time after a Section
11(a)(ii) Event. The Rights Agreement may be amended without the approval of the
holders of the Rights as and to the extent set forth therein.
No fractional shares of Common Stock will be issued upon the
exercise or exchange of any Right or Rights evidenced hereby, but in lieu
thereof a cash payment will be made, as provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Common Stock or
of any other securities of the Company which may at any time be issuable on the
exercise hereof, nor shall anything contained in the Rights Agreement or herein
be construed to confer upon the holder hereof, as such, any of the rights of a
stockholder of the Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof, or to give 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 or exchanged for Common Stock as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
<PAGE>
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal. Dated as of 1996.
[SEAL] NATIONAL FUEL GAS COMPANY
By:
---------------------------
Name
Title
ATTEST:
By:
-------------------------------
Name:
Title:
Countersigned:
-----------------------,
as Rights Agent
By:
---------------------------
Authorized Signature
Date:
<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)
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:
----------------------------
Signature
- ----------------------------------------------
Signature Guaranteed:
(Signatures must be guaranteed.)
<PAGE>
CERTIFICATE
- ----------------------------------
The undersigned hereby certifies by checking the
appropriate space that:
Exercising this Right Certificate will ____
will not _____ enable the undersigned, its Affiliates, its Associates and/or any
other Person with which the undersigned or any of the undersigned's Affiliates
or Associates has any agreement, arrangement or understanding (whether or not in
writing) for the purpose of acquiring, holding, voting or disposing of
securities of the Company to obtain, individually or in the aggregate,
beneficial ownership of Common Stock or other securities that have 10% or more
of the aggregate voting power of the outstanding shares of the Common Stock and
other securities having voting power.
Dated:
---------------------------- ------------------------------
Signature
Signature Guaranteed:
(Signatures must be guaranteed.)
<PAGE>
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.
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise Rights evidenced by the Right
Certificate.)
To National Fuel Gas Company:
The undersigned hereby irrevocably elects to exercise __________ Rights
represented by this Right Certificate to purchase the shares of Common Stock
issuable upon the exercise of such Rights (or such other securities of the
Company or of any other Person which may be issuable upon the exercise of the
Rights) and requests that certificates for such shares be issued in the name of:
Please insert social security or other taxpayer 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:
Please insert social security or other taxpayer identifying number
- ------------------------------------------------------------------------------
(Please print name and address)
- ------------------------------------------------------------------------------
Dated: ___________, ____
- ---------------------------------
Signature
Signature Guaranteed:
(Signatures must be guaranteed.)
<PAGE>
SUMMARY OF RIGHTS TO PURCHASE COMMON STOCK EXHIBIT B
On June 13, 1996, the Board of Directors of National Fuel Gas Company
(the "Company") declared a dividend distribution of one Right for each
outstanding share of Common Stock, $1.00 par value, of the Company (the "Common
Stock") to stockholders of record at the close of business on July 31, 1996 (the
"Record Date"). The Rights are to be issued pursuant to a shareholder rights
plan which was approved by the Board of Directors on March 19, 1996. Each Right
entitles the registered holder to purchase from the Company one-half of one
share of common Stock at a price of $130 per share (the "Purchase Price"), being
$65.00 per half share, subject to adjustment. The description and terms of the
Rights are set forth in a Rights Agreement (the "Rights Agreement") between the
Company and Marine Midland Bank, as Rights Agent (the "Rights Agent").
Distribution Date; Transfer of Rights
- -------------------------------------
Until the earlier to occur of (i) ten days following the date (the
"Shares Acquisition Date") of the public announcement that a person or group of
affiliated or associated persons (an "Acquiring Person") has acquired, or
obtained the right to acquire, beneficial ownership of Common Stock or other
voting securities ("Voting Stock") that have 10% or more of the voting power of
the outstanding shares of Voting Stock or (ii) ten days following the
commencement or announcement of an intention to make a tender offer or exchange
offer the consummation of which would result in such person acquiring, or
obtaining the right to acquire, beneficial ownership of Voting Stock having 10%
or more of the voting power of the outstanding shares of Voting Stock (the
earlier of such dates being called the "Distribution Date"), the Rights will be
evidenced, with respect to any of the Company's Common Stock certificates
outstanding as of the Record Date, by such Common Stock certificate. The Rights
Agreement provides that, until the Distribution Date, the Rights will be
transferred with and only with the Company's Common Stock. Until the
Distribution Date (or earlier redemption or expiration of the Rights), new
Common Stock certificates issued after the Record Date upon transfer or new
issuance of the Company's Common Stock will contain a notation incorporating the
Rights Agreement by reference. Until the Distribution Date (or earlier
redemption or expiration of the Rights), the surrender for transfer of any of
the Company's Common Stock certificates outstanding as of the Record Date 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 Company's Common Stock
as of the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights
will expire at the close of Business on July 31, 2008, unless earlier redeemed
or exchanged by the Company as described below.
Exercise of Rights for Common Stock of the Company
- --------------------------------------------------
Subject to redemption or exchange of the Rights, at any time following
the Distribution Date, each holder of a Right will thereafter have the right to
receive, upon exercise, Common Stock (or, in certain circumstances, cash,
property or other securities of the Company) having a value equal to two times
the Purchase Price of the Right then in effect. Notwithstanding any of the
foregoing, following the occurrence of such event set forth in this paragraph,
all Rights that are, or (under certain circumstances specified in the Rights
Agreement) were, beneficially owned by any Acquiring Person will be null and
void.
Exercise of Rights for Shares of the Acquiring Company
- ---------------------------------------------
In the event that, at any time following the Shares Acquisition Date,
(i) the Company is acquired in a merger or other business combination
transaction, or (ii) 50% or more of the Company's assets or earning power is
sold or transferred, each holder of a Right (except Rights which previously have
been voided as set forth above) shall thereafter have the right to receive, upon
exercise, Common Stock of the acquiring company having a value equal to two
times the Purchase Price of the Right then in effect.
Adjustments to Purchase Price
- -----------------------------
The Purchase Price payable, and the number of shares of Common Stock
(or other securities, as the case may be) issuable upon exercise of the Rights
are subject to adjustment from time to time to prevent dilution (i) in the event
of a stock dividend on, or a subdivision, combination or reclassification of,
the Common Stock, (ii) upon the grant to holders of the Common Stock of certain
rights or warrants to subscribe for or purchase shares of the Common Stock or
convertible securities at less than the then Current Market Price of the Common
Stock or (iii) upon the distribution to holders of the Common Stock of evidences
of indebtedness or assets (excluding regular periodic cash dividends or
dividends payable in the Common Stock) or of subscription rights or warrants
(other than those referred to above). Prior to the Distribution Date, the Board
of Directors of the Company may make such equitable adjustments as it deems
appropriate in the circumstances in lieu of any adjustment otherwise required by
the foregoing.
With certain exceptions, no adjustment in the Purchase Price will be
required until the earlier of (i) three years from the date of the event giving
rise to such adjustment or (ii) the time at which cumulative adjustments
require an adjustment of at least 1% in such Purchase Price. No fractional
shares of Common Stock will be issued and, in lieu thereof, an adjustment in
cash will be made based on the market price of the Common Stock on the last
trading date prior to the date of exercise.
Redemption and Exchange of Rights
- ---------------------------------
At any time prior to 5:00 P.M. Buffalo, New York time on the tenth day
following the Shares Acquisition Date, the Company may redeem the Rights in
whole, but not in part, at a price of $.01 per Right (the "Redemption Price").
The decision to redeem shall require the affirmative vote of three-fourths of
the entire Board of Directors. Immediately upon the action of the Board of
Directors of the Company electing to redeem the Rights, the Company shall make
announcement thereof, and upon such action, the right to exercise the Rights
will terminate and the only right of the holders of Rights will be to receive
the Redemption Price.
At any time after the occurrence of the event set forth under the
heading "Exercise of Rights for Common Stock of the Company" above, the Board of
Directors, acting by the affirmative vote of three-fourths of the entire Board
of Directors, may exchange the Rights (other than Rights owned by an Acquiring
Person, which have become void), in whole or in part, at an exchange ratio of
one share of Common Stock, and/or other securities, cash or other assets deemed
to have the same value as one share of Common Stock, per Right, subject to
adjustment.
Until a Right is exercised or exchanged for Common Stock, the holder
thereof, as such, will have no rights as a stockholder of the Company,
including, without limitation, the right to vote or to receive dividends. While
the distribution of the Rights will not be taxable to stockholders or to the
Company, stockholders may, depending upon the circumstances, recognize taxable
income in the event that the Rights become exercisable for Common Stock or other
consideration of the Company or for the stock of the Acquiring Person as set
forth above, or are exchanged as provided in the preceding paragraph.
Amendments to Terms of the Rights
- ---------------------------------
Any of the provisions of the Rights Agreement may be amended by the
Board of Directors of the Company without the consent of the holders of the
Rights prior to the Distribution Date; provided that any such amendment is
approved by the affirmative vote of three-fourths of the entire Board of
Directors. Thereafter, the provisions of the Rights Agreement may be amended
by the Board of Directors, acting by a like three-fourths vote, in order to cure
any ambiguity, defect or inconsistency, or to make changes which do not
adversely affect the interests of holders of Rights (excluding the interest of
any Acquiring Person); provided, however, that no supplement or amendment may be
made on or after the Distribution Date which changes those provisions relating
to the principal economic terms of the Rights. The Board of Directors may also,
by a like three-fourths vote, extend the redemption period for up to an
additional 20 days.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A dated
June 12, 1996. 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 hereby incorporated herein by reference.
