SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
SEEQ TECHNOLOGY INCORPORATED
(Exact name of registrant as specified in charter)
Delaware 94-2711298
(State of incorporation (IRS Employer
or organization) Identification No.)
47200 Bayside Parkway
Fremont, California 94538
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (510)226-7400
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be
registered
___________________ ______________________________
Securities to be registered pursuant to Section 12(g) of the Act:
PREFERRED SHARE PURCHASE RIGHTS
(Title of Class)
<PAGE>
Item 1. Description of Registrant's Securities to be Registered
On April 21, 1995, the Board of Directors of SEEQ
Technology Incorporated (the "Company") declared a dividend of
one preferred share purchase right (a "Right") for each out-
standing share of common stock, $0.01 par value (the "Common
Shares"), of the Company. The dividend is payable on May 2, 1995
(the "Record Date"), to the stockholders of record on that date.
Each Right entitles the registered holder to purchase from the
Company one one-hundredth of a share of Series A Junior
Participating Preferred Stock, $0.01 par value (the "Preferred
Shares"), of the Company at a price of $15 per one one-hundredth
of a Preferred Share (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights are set
forth in a Rights Agreement (the "Rights Agreement") between the
Company and American Stock Transfer & Trust Company, as Rights
Agent (the "Rights Agent").
Until the earlier to occur of (i) 10 days
following a public announcement that a person or group of
affiliated or associated persons (an "Acquiring Person") have
acquired beneficial ownership of 15% or more of the outstanding
Common Shares or (ii) 10 business days (or such later date as may
be determined by action of the Board of Directors prior to such
time as any Person becomes an Acquiring Person) following the
commencement of, or announcement of an intention to make, a
tender offer or exchange offer the consummation of which would
result in the beneficial ownership by a person or group of 15% or
more of such outstanding Common Shares (the earlier of such dates
being called the "Distribution Date"), the Rights will be
evidenced, with respect to any of the Common Share certificates
outstanding as of the Record Date, by such Common Share
certificate.
The Rights Agreement provides that, until the
Distribution Date, the Rights will be transferred with and only
with the Common Shares. Until the Distribution Date (or earlier
redemption or expiration of the Rights), new Common Share
certificates issued after the Record Date, upon transfer or new
issuance of Common Shares, 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 certificates for Common Shares
outstanding as of the Record Date will also constitute the
transfer of the Rights associated with the Common Shares
represented by such certificate. As soon as practicable
following the Distribution Date, separate certificates evidencing
the Rights ("Right Certificates") will be mailed to holders of
record of the Common Shares 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 on May 2, 2005 (the
"Final Expiration Date"), unless the Final Expiration Date is
extended or unless the Rights are earlier redeemed by the
Company, in each case, as described below.
The Purchase Price payable, and the number of Preferred
Shares or other securities or property issuable, upon exercise of
the Rights are subject to adjustment from time to time to prevent
dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the
Preferred Shares, (ii) upon the grant to holders of the Preferred
Shares of certain rights or warrants to subscribe for or purchase
Preferred Shares at a price, or securities convertible into
Preferred Shares with a conversion price, less than the then
current market price of the Preferred Shares or (iii) upon the
distribution to holders of the Preferred Shares of evidences of
indebtedness or assets (excluding regular periodic cash dividends
paid out of earnings or retained earnings or dividends payable in
Preferred Shares) or of subscription rights or warrants (other
than those referred to above).
The number of outstanding Rights and the number of one
one-hundredths of a Preferred Share issuable upon exercise of
each Right are also subject to adjustment in the event of a stock
split of the Common Shares or a stock dividend on the Common
Shares payable in Common Shares or subdivisions, consolidations
or combinations of the Common Shares occurring, in any such case,
prior to the Distribution Date.
Preferred Shares purchasable upon exercise of the
Rights will not be redeemable. Each Preferred Share will be
entitled to an aggregate dividend of 100 times the dividend
declared per Common Share. In the event of liquidation, the
holders of the Preferred Shares will be entitled to an aggregate
2.
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payment of 100 times the payment made per Common Share. Each
Preferred Share will have 100 votes, voting together with the
Common Shares. Finally, in the event of any merger,
consolidation or other transaction in which Common Shares are
exchanged, each Preferred Share will be entitled to receive 100
times the amount received per Common Share. These rights are
protected by customary antidilution provisions.
Because of the nature of the Preferred Shares'
dividend, liquidation and voting rights, the value of the one
one-hundredth interest in a Preferred Share purchasable upon
exercise of each Right should approximate the value of one Common
Share.
In the event that, following the Distribution
Date, the Company is acquired in a merger or other business
combination transaction, or 50% or more of its consolidated
assets or earning power are sold, proper provision will be made
so that each holder of a Right will thereafter have the right to
receive, upon the exercise thereof at the then current exercise
price of the Right, that number of shares of common stock of the
acquiring company which at the time of such transaction will have
a market value of two times the exercise price of the Right.
In the event that any person or group of affiliated or
associated persons becomes the beneficial owner of 15% or more of
the outstanding Common Shares (except pursuant to a tender offer
for all of the Common Shares at a price and on terms determined
by a majority of the Continuing Directors to be fair to and
otherwise in the best interests of the Company and its
stockholders), proper provision will be made so that each holder
of a Right, other than Rights beneficially owned by the Acquiring
Person (which will thereafter be void), will thereafter have the
right to receive upon exercise that number of Common Shares (or
cash, other securities or property) having a market value of two
times the exercise price of the Right.
At any time after the acquisition by a person or
group of affiliated or associated persons of beneficial ownership
of 15% or more of the outstanding Common Shares and prior to the
acquisition by such person or group of 50% or more of the
outstanding Common Shares, the Board of Directors of the Company
may exchange the Rights (other than Rights owned by such person
or group which have become void), in whole or in part, at an
exchange ratio of one Common Share, or one one-hundredth of a
Preferred Share (or a fraction of a Preferred Share having
equivalent market value), per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase
Price will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price. No fractional
Preferred Shares will be issued (other than fractions which are
integral multiples of one one-hundredth of a Preferred Share,
which may, at the election of the Company, be evidenced by
depositary receipts) and, in lieu thereof, an adjustment in cash
will be made based on the market price of the Preferred Shares on
the last trading day prior to the date of exercise.
At any time prior to the tenth business day after the
acquisition by a person or group of affiliated or associated
persons of beneficial ownership of 15% or more of the outstanding
Common Shares, the Board of Directors of the Company may redeem
the Rights in whole, but not in part, at a price of $0.01 per
Right (the "Redemption Price"). The redemption of the Rights may
be made effective at such time on such basis and with such
conditions as the Board of Directors in its sole discretion may
establish. Immediately upon any redemption of the Rights, the
right to exercise the Rights will terminate and the only right of
the holders of Rights will be to receive the Redemption Price.
The Rights are also redeemable under other circumstances as
specified in the Rights Agreement.
The terms of the Rights may be amended by the
Board of Directors of the Company without the consent of the
holders of the Rights, including an amendment to lower certain
thresholds described above to not less than the greater of (i)
any percentage greater than the largest percentage of the
outstanding Common Shares then known to the Company to be
beneficially owned by any person or group of affiliated or
associated persons and (ii) 15%, except that from and after such
time as any person becomes an Acquiring Person no such amendment
may adversely affect the interests of the holders of the Rights.
3.
<PAGE>
Until a Right is exercised, the holder thereof, as
such, will have no rights as a stockholder of the Company,
including, without limitation, the right to vote or to receive
dividends.
The Rights have certain anti-takeover effects.
The Rights will cause substantial dilution to a person or group
that attempts to acquire the Company on terms not approved by
the Company's Board of Directors, except pursuant to an offer
conditioned on a substantial number of Rights being acquired.
The Rights should not interfere with any merger or other business
combination approved by the Board of Directors since the Rights
may be redeemed by the Company at the Redemption Price prior to
the time that a person or group has acquired beneficial ownership
of 15% or more of the Common Shares.
The Rights Agreement, dated as of April 21, 1995,
between the Company and American Stock Transfer & Trust Company,
as Rights Agent, specifying the terms of the Rights is attached
hereto as an exhibit and is incorporated herein by reference.
The foregoing description of the Rights is qualified in its
entirety by reference to such exhibit.
4.
<PAGE>
Item 2. Exhibits.
1. Rights Agreement, dated as of April 21, 1995, between
the Company and American Stock Transfer & Trust Company, which
includes the Certificate of Designations for the Series A Junior
Participating Preferred Stock as Exhibit A, the form of Right
Certificate as Exhibit B and the Summary of Rights to Purchase
Preferred Shares as Exhibit C. Pursuant to the Rights Agreement,
printed Right Certificates will not be mailed until as soon as
practicable after the earlier of the tenth day after public
announcement that a person or group has acquired beneficial
ownership of 15% or more of the Common Shares or the tenth
business day (or such later date as may be determined by action
of the Board of Directors) after a person commences, or announces
its intention to commence, a tender offer or exchange offer the
consummation of which would result in the beneficial ownership by
a person or group of 15% or more of the Common Shares.
5.
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this
registration statement to be signed on its behalf by the
undersigned, thereto duly authorized.
SEEQ TECHNOLOGY INCORPORATED
DATE: April 28, 1995 By: RALPH J. HARMS
_______________________________
Name: Ralph J. Harms
Title: Vice President, Finance
and Administration,
Chief Financial Officer
and Secretary
6.
<PAGE>
EXHIBIT INDEX
EXHIBIT
NUMBER DOCUMENT DESCRIPTION
_______ ____________________
1. Rights Agreement, dated as of April 21, 1995, between the
Company and American Stock Transfer & Trust Company, which
includes the Certificate of Designations for the Series A Junior
Participating Preferred Stock as Exhibit A, the form of Right
Certificate as Exhibit B and the Summary of Rights to Purchase
Preferred Shares as Exhibit C. Pursuant to the Rights Agreement,
printed Right Certificates will not be mailed until as soon as
practicable after the earlier of the tenth day after public
announcement that a person or group has acquired beneficial
ownership of 15% or more of the Common Shares or the tenth
business day (or such later date as may be determined by action
of the Board of Directors) after a person commences, or announces
its intention to commence, a tender offer or exchange offer the
consummation of which would result in the beneficial ownership by
a person or group of 15% or more of the Common Shares.
7.
_________________________________________________________________
SEEQ TECHNOLOGY INCORPORATED
and
AMERICAN STOCK TRANSFER & TRUST COMPANY
Rights Agent
Rights Agreement
Dated as of April 21, 1995
_________________________________________________________________
<PAGE>
TABLE OF CONTENTS
Page
Section 1. Certain Definitions . . . . . . . . . . . . . . 1
Section 2. Appointment of Rights Agent . . . . . . . . . . 8
Section 3. Issue of Right Certificates . . . . . . . . . . 8
Section 4. Form of Right Certificates. . . . . . . . . . . 11
Section 5. Countersignature and Registration . . . . . . . 12
Section 6. Transfer, Split-Up, Combination and Exchange
of Right Certificates; Mutilated, Destroyed,
Lost or Stolen Right Certificates . . . . . . . 13
Section 7. Exercise of Rights; Purchase Price; Expiration
Date of Rights . . . . . . . . . . . . . . . . . 14
Section 8. Cancellation and Destruction of Right
Certificates . . . . . . . . . . . . . . . . . . 17
Section 9. Availability of Preferred Shares . . . . . . . . 17
Section 10. Preferred Shares Record Date . . . . . . . . . 20
Section 11. Adjustment of Purchase Price, Number of Shares
or Number of Rights . . . . . . . . . . . . . . 21
Section 12. Certificate of Adjusted Purchase Price or Number
of Shares . . . . . . . . . . . . . . . . . . . 36
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power . . . . . . . . . . . . 37
Section 14. Fractional Rights and Fractional Shares . . . . 40
Section 15. Rights of Action . . . . . . . . . . . . . . . 42
Section 16. Agreement of Right Holders . . . . . . . . . . 43
Section 17. Right Certificate Holder Not Deemed a
Stockholder. . . . . . . . . . . . . . . . . . . 44
Section 18. Concerning the Rights Agent. . . . . . . . . . . 45
Section 19. Merger or Consolidation or Change of Name of
Rights Agent . . . . . . . . . . . . . . . . . . 46
i.
<PAGE>
Section 20. Duties of Rights Agent . . . . . . . . . . . . . 47
Section 21. Change of Rights Agent . . . . . . . . . . . . . 51
Section 22. Issuance of New Right Certificates . . . . . . . 53
Section 23. Redemption . . . . . . . . . . . . . . . . . . . 54
Section 24. Exchange . . . . . . . . . . . . . . . . . . . . 56
Section 25. Notice of Certain Events . . . . . . . . . . . . 59
Section 26. Notices. . . . . . . . . . . . . . . . . . . . . 61
Section 27. Supplements and Amendments . . . . . . . . . . . 62
Section 28. Successors . . . . . . . . . . . . . . . . . . . 63
Section 29. Determinations and Actions by the Board of
Directors . . . . . . . . . . . . . . . . . . . 63
Section 30. Benefits of This Agreement . . . . . . . . . . . 64
Section 31. Severability . . . . . . . . . . . . . . . . . . 65
Section 32. Governing Law. . . . . . . . . . . . . . . . . . 65
Section 33. Counterparts . . . . . . . . . . . . . . . . . . 65
Section 34. Descriptive Headings . . . . . . . . . . . . . . 66
Exhibit A - Form of Certificate of Designations of Series A
Junior Participating Preferred Stock of SEEQ
Technology Incorporated
Exhibit B - Form of Right Certificate
Exhibit C - Summary of Rights to Purchase Preferred Shares
ii.
<PAGE>
RIGHTS AGREEMENT
Rights Agreement, dated as of April 21, 1995, between
SEEQ Technology Incorporated, a Delaware corporation (the
"Company"), and American Stock Transfer & Trust Company (the
"Rights Agent").
The Board of Directors of the Company has authorized
and declared a dividend of one preferred share purchase right (a
"Right") for each Common Share (as hereinafter defined) of the
Company outstanding as of the Close of Business (as hereinafter
defined) on May 2, 1995 (the "Record Date"), each Right
representing the right to purchase one one-hundredth of a
Preferred Share (as hereinafter defined) upon the terms and
subject to the conditions herein set forth, and has further
authorized and directed the issuance of one Right with respect to
each Common Share that shall become outstanding between the
Record Date and the earliest of the Distribution Date, the
Redemption Date or the Final Expiration Date (as such terms are
hereinafter defined).
Accordingly, 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 15% or more of the Common Shares of the
Company then outstanding, but
1.
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shall not include the Company, any Subsidiary (as such term is
hereinafter defined) of the Company, any employee benefit plan of
the Company or any Subsidiary of the Company, or any entity
holding Common Shares for or pursuant to the terms of any such
plan. Notwithstanding the foregoing, no Person shall become an
"Acquiring Person" as the result of an acquisition of Common
Shares by the Company which, by reducing the number of shares
outstanding, increases the proportionate number of shares
beneficially owned by such Person to 15% or more of the Common
Shares of the Company then outstanding; provided, however, that
if a Person shall become the Beneficial Owner of 15% or more of
the Common Shares of the Company then outstanding by reason of
share purchases by the Company and shall, after such share
purchases by the Company, become the Beneficial Owner of any
additional Common Shares of the Company, then such Person shall
be deemed to be an "Acquiring Person." Notwithstanding the
foregoing, if the Board of Directors of the Company determines
(upon approval by a majority of the Continuing Directors (as such
term is hereinafter defined)) in good faith that a Person who
would otherwise be an Acquiring Person, as defined pursuant to
the foregoing provisions of this paragraph (a), is eligible to
file and did file a Schedule 13G, and such Person divests as
promptly as practicable a sufficient number of Common Shares so
that such Person would no longer be an Acquiring Person, as
defined pursuant to the foregoing provisions of this paragraph
(a), then such Person shall not be deemed to be an "Acquiring
Person" for any purpose of this Agreement.
2.
<PAGE>
(b) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General
Rules and Regulations under the Exchange Act (as such term is
hereinafter defined).
(c) 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 beneficially owns, directly or
indirectly;
(ii) which such Person or any of such Person's
Affiliates or Associates has (A) the right to acquire (whether
such right is exercisable immediately or only after the passage
of time) pursuant to any agreement, arrangement or understanding
(other than customary agreements with and between underwriters
and selling group members with respect to a bona fide public
offering of securities), or upon the exercise of conversion
rights, exchange rights, rights (other than these Rights),
warrants or options, or otherwise; provided, however that a
Person shall not be deemed the Beneficial Owner of, or to
beneficially own, (1) securities tendered pursuant to a tender or
exchange offer made by or on behalf of such Person or any of such
Person's Affiliates or Associates until such tendered
securities are accepted for purchase or exchange or
(2) securities which a Person or any Person's Affiliates or
Associates may be deemed to have the right to acquire pursuant to
any merger or other acquisition agreement between the Company and
such Person (or one or more of such Person's Affiliates or
Associates) if such agreement has been approved by the Board of
Directors of the
3.
<PAGE>
Company, upon the affirmative vote of a majority of the
Continuing Directors, prior to there being an Acquiring Person;
or (B) the right to vote pursuant to any agreement, arrangement
or understanding; provided, however, that a Person shall not be
deemed the Beneficial Owner of, or to beneficially own, any
security if the agreement, arrangement or understanding to vote
such security (1) arises solely from a revocable proxy or consent
given to such Person in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the
applicable rules and regulations promulgated under the Exchange
Act and (2) is not also 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 (other than customary agreements
with and between underwriters and selling group members with
respect to a bona fide public offering of securities) for the
purpose of acquiring, holding, voting (except to the extent
contemplated by the proviso to Section 1(c)(ii)(B)) or disposing
of any securities of the Company.
Notwithstanding anything in this definition of
Beneficial Ownership to the contrary, the phrase "then
outstanding," when used with reference to a Person's Beneficial
Ownership of securities of the Company, shall mean the number of
such securities then issued and outstanding together with the
number of such securities not then actually
4.
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issued and outstanding which such Person would be deemed to own
beneficially hereunder.
(d) "Business Day" shall mean any day other than a
Saturday, a Sunday, or a day on which banking institutions in the
State of California are authorized or obligated by law or
executive order to close.
(e) "Company" shall have the meaning set forth in the first
paragraph at the beginning of this Agreement.
(f) "Close of Business" on any given date shall mean 5:00
P.M., San Francisco, California time, on such date;
provided, however, that if such date is not a Business Day it
shall mean 5:00 P.M., San Francisco, California time, on the next
succeeding Business Day.
(g) "Common Shares" when used with reference to the Company
shall mean the shares of common stock, $.01 par value, of the
Company. "Common Shares" when used with reference to any Person
other than the Company shall mean the capital stock (or other
equity interest) with the greatest voting power of such other
Person or, if such other Person is a Subsidiary of another
Person, the Person or Persons which ultimately control such
first-mentioned Person.
(h) "common stock equivalents" shall have the meaning set
forth in Section 11 hereof.
(i) "Continuing Director" shall mean (i) any person
who is a member of the Board of Directors of the Company, while
such person is a member of the Board of Directors, who is not an
Acquiring Person, or an Affiliate or Associate of an Acquiring
5.
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Person, or a representative or agent of an Acquiring Person or of
any such Affiliate or Associate, and who was a member of the
Board of Directors prior to the date of this Agreement, or (ii)
any person who subsequently becomes a member of the Board of
Directors and who, while such person is a member of the Board of
Directors, is not an Acquiring Person or an Affiliate or
Associate of an Acquiring Person, or a representative or agent of
an Acquiring Person or of any such Affiliate or Associate, if
such Person's nomination for election or such Person's election
to the Board of Directors is recommended or approved by a
majority of the Continuing Directors then on the Board of
Directors.
(j) "current per share market price" shall have the meaning
set forth in Section 11 hereof.
(k) "Current Value" shall have the respective meanings set
forth in Section 11 hereof and Section 24 hereof.
(l) "Distribution Date" shall have the meaning set forth in
Section 3 hereof.
(m) "equivalent preferred shares" shall have the meaning set
forth in Section 11 hereof.
(n) "Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended, as in effect on the date of this
Agreement.
(o) "Exchange ratio" shall have the meaning set forth in
Section 24 hereof.
(p) "Final Expiration Date" shall have the meaning set forth
in Section 7 hereof.
6.
<PAGE>
(q) "issuer" shall have the meaning set forth in Section 13
hereof.
(r) "Person" shall mean any individual, firm, corporation
or other entity, and shall include any successor (by merger or
otherwise) of such entity.
(s) "Preferred Shares" shall mean shares of Series A Junior
Participating Preferred Shares, no par value, of the Company
having the rights and preferences set forth in the Form of
Certificate of Designations attached to this Agreement as
Exhibit A.
(t) "Purchase Price" shall have the meaning set forth in
Section 4 hereof.
(u) "Record Date" shall have the meaning set forth in the
second paragraph at the beginning of this Agreement.
(v) "Redemption Date" shall have the meaning set forth in
Section 7 hereof.
(w) "Redemption Price" shall have the meaning set forth in
Section 23 hereof.
(x) "Right" shall have the meaning set forth in the second
paragraph at the beginning of this Agreement.
(y) "Right Certificate" shall have the meaning set forth in
Section 3 hereof.
(z) "Rights Agent" shall have the meaning set forth in the
first paragraph at the beginning of this Agreement.
(aa) "Securities Act" shall have the meaning set forth in
Section 9 hereof.
(bb) "Security" shall have the meaning set forth in
Section 11 hereof.
(cc) "Shares Acquisition Date" shall mean the first date of
public announcement (which, for purposes of this definition,
shall include, without limitation, a
7.
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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.
(dd) "Spread" shall have the meaning set forth in
Section 11 hereof.
(ee) "Subsidiary" of any Person shall mean any corporation
or other entity of which a majority of the voting power of the
voting equity securities or equity interest is owned, directly or
indirectly, by such Person.
(ff) "Substitution Period" shall have the meaning set forth
in Section 11 hereof.
(gg) "Summary of Rights" shall have the meaning set forth
in Section 3 hereof.
(hh) "Trading Day" shall have the meaning set forth in
Section 11 hereof.
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 may
from time to time appoint such co-Rights Agents as it may deem
necessary or desirable.
Section 3. Issue of Right Certificates. (a) Until the
earlier of (i) the tenth day after the Shares Acquisition Date or
(ii) the tenth business day (or such later date as may be
determined by action of the Board of Directors (upon approval by
a majority of the Continuing Directors) prior to such time as any
Person becomes an Acquiring Person) after the date of the
commencement by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the
Company or of any
8.
<PAGE>
Subsidiary of the Company or any entity holding Common Shares for
or pursuant to the terms of any such plan) 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
entity holding Common Shares for or pursuant to the terms of any
such plan) to commence, a tender or exchange offer the
consummation of which would result in any Person becoming the
Beneficial Owner of Common Shares aggregating 15% or more of the
then outstanding Common Shares (including any such date which is
after the date of this Agreement and prior to the issuance of the
Rights; the earlier of such dates being herein referred to as the
"Distribution Date"), (x) the Rights will be evidenced (subject
to the provisions of Section 3(b) hereof) by the certificates for
Common Shares registered in the names of the holders thereof
(which certificates shall also be deemed 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 Shares. As soon as
practicable after the Distribution Date, the Company will notify
the Rights Agent thereof and the Company will prepare and
execute, the Rights Agent will countersign, and the Company will
send or cause to be sent (and the Rights Agent will, if
requested, send) by first-class, insured, postage-prepaid mail,
to each record holder of Common Shares 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 B hereto (a "Right
Certificate"), evidencing one Right for each Common Share so
held. As of the Distribution Date, the Rights will be evidenced
solely by such Right Certificates.
9.
<PAGE>
(b) On the Record Date, or as soon as practicable
thereafter, the Company will send a copy of a Summary of Rights
to Purchase Preferred Shares, in substantially the form of
Exhibit C hereto (the "Summary of Rights"), by first-class,
postage-prepaid mail, to each record holder of Common Shares 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 Shares outstanding as of the Record Date,
until the Distribution Date, the Rights will be evidenced by such
certificates registered in the names of the holders thereof
together with a copy of the Summary of Rights attached thereto.
Until the Distribution Date (or the earlier of the Redemption
Date or the Final Expiration Date), the surrender for transfer of
any certificate for Common Shares outstanding on the Record Date,
with or without a copy of the Summary of Rights attached thereto,
shall also constitute the transfer of the Rights associated with
the Common Shares represented thereby.
(c) Certificates for Common Shares which become
outstanding (including, without limitation, reacquired Common
Shares referred to in the last sentence of this paragraph (c))
after the Record Date but prior to the earliest of the
Distribution Date, the Redemption Date or the Final Expiration
Date 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 SEEQ TECHNOLOGY INCORPORATED AND AMERICAN STOCK TRANSFER
& TRUST COMPANY DATED AS OF APRIL 21, 1995 (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 SEEQ TECHNOLOGY INCORPORATED. UNDER CERTAIN
CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS
10.
<PAGE>
AGREEMENT, SUCH RIGHTS WILL BE EVIDENCED BY SEPARATE CERTIFICATES
AND WILL NO LONGER BE EVIDENCED BY THIS CERTIFICATE. SEEQ
TECHNOLOGY INCORPORATED WILL MAIL TO THE HOLDER OF THIS
CERTIFICATE A COPY OF THE RIGHTS AGREEMENT WITHOUT CHARGE AFTER
RECEIPT OF A WRITTEN REQUEST THEREFOR. UNDER CERTAIN
CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS
ISSUED TO ANY PERSON WHO BECOMES AN ACQUIRING PERSON (AS DEFINED
IN THE RIGHTS AGREEMENT) MAY BECOME NULL AND VOID.
With respect to such certificates containing the
foregoing legend, until the Distribution Date, the Rights
associated with the Common Shares represented by such
certificates shall be evidenced by such certificates alone, and
the surrender for transfer of any such certificate shall also
constitute the transfer of the Rights associated with the Common
Shares represented thereby. In the event that the Company
purchases or acquires any Common Shares after the Record Date but
prior to the Distribution Date, any Rights associated with such
Common Shares shall be deemed cancelled and retired so that the
Company shall not be entitled to exercise any Rights associated
with the Common Shares which are no longer outstanding.
Section 4. Form of Right Certificates. The Right
Certificates (and the forms of election to purchase Preferred
Shares and of assignment to be printed on the reverse thereof)
shall be substantially the same as Exhibit B 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 or
transaction reporting system on which the Rights may from time to
time be listed, or to conform to usage. Subject to the
provisions of Section 22 hereof,
11.
<PAGE>
the Right Certificates shall entitle the holders thereof to
purchase such number of one one-hundredths of a Preferred Share
as shall be set forth therein at the price per one one-hundredth
of a Preferred Share set forth therein (the "Purchase Price"),
but the number of such one one-hundredths of a Preferred Share
and the Purchase Price shall be subject to adjustment as provided
herein.
Section 5. Countersignature and Registration. The
Right Certificates shall be executed on behalf of the Company by
its Chairman of the Board, its President, any of its Vice
Presidents, or its Treasurer, either manually or by facsimile
signature, shall have affixed thereto the Company's seal or a
facsimile thereof, and shall be attested by the Secretary or an
Assistant Secretary of the Company, either manually or by
facsimile signature. The Right Certificates shall be manually
countersigned by the Rights Agent and shall not be valid for any
purpose unless 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 and issued and delivered by the Company 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.
12.
<PAGE>
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, the number of Rights evidenced on its face by each
of the Right Certificates and the date of each of the Right
Certificates.
Section 6. Transfer, Split-Up, Combination and
Exchange of Right Certificates; Mutilated, Destroyed, Lost or
Stolen Right Certificates. 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 earlier of the Redemption Date or the Final Expiration Date,
any Right Certificate or Right Certificates (other than Right
Certificates representing Rights that have become void pursuant
to Section 11(a)(ii) hereof or that have been exchanged pursuant
to Section 24 hereof) 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 one
one-hundredths of a Preferred Share (or other securities or
property) as the Right Certificate or Right Certificates
surrendered then entitled such 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 principal
office of the Rights Agent. Thereupon the Rights Agent shall
countersign and deliver to the person entitled thereto a Right
Certificate or Right Certificates, as the case may be, as so
requested. The Company may require payment of a sum sufficient
to cover any tax or
13.
<PAGE>
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, and, at the Company's request,
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 holder in lieu of the Right Certificate so lost,
stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights. (a) The registered holder of any
Right Certificate may exercise the Rights evidenced thereby
(except as otherwise provided herein) 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 and
certification on the reverse side thereof duly executed, to the
Rights Agent at the office of the Rights Agent designated for
such purpose, together with payment of the Purchase Price for
each one one-hundredth of a Preferred Share as to which the
Rights are exercised, at or prior to the earliest of (i) the
Close of Business on May 2, 2005 (the "Final Expiration Date"),
(ii) the time at which the Rights are redeemed as provided in
Section 23 hereof (the "Redemption Date"), (iii) the time at
which such Rights are exchanged as provided in Section 24 hereof,
or (iv) the consummation of any merger or
14.
<PAGE>
other acquisition involving the Company pursuant to an agreement
described in Section 1(c)(ii)(A)(2) hereof.
(b) The Purchase Price for each one one-hundredth of a
Preferred Share pursuant to the exercise of a Right shall
initially be $15, shall be subject to adjustment from time to
time as provided in Sections 11 and 13 hereof and shall be
payable in lawful money of the United States of America in
accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase duly
executed, accompanied by payment of the Purchase Price for the
shares to be purchased and an amount equal to any applicable
transfer tax required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof by certified
check, cashier's check or money order payable to the order of the
Company, the Rights Agent shall thereupon promptly (i) (A)
requisition from any transfer agent of the Preferred Shares
certificates for the number of Preferred Shares to be purchased
and the Company hereby irrevocably authorizes its transfer agent
to comply with all such requests, or (B) requisition from a
depositary agent properly appointed by the Company depositary
receipts representing such number of one one-hundredths of a
Preferred Share as are to be purchased (in which case
certificates for the Preferred Shares represented by such
receipts shall be deposited by the transfer agent with the
depositary agent) and the Company hereby directs the depositary
agent to comply with such request, (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 hereof, (iii) after receipt of such certificates or depositary
receipts, cause the
15.
<PAGE>
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, deliver such cash to or upon the
order of the registered holder of such Right Certificate.
(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) The Company covenants and agrees that it will
cause to be reserved and kept available out of its authorized and
unissued Preferred Shares or any Preferred Shares held in its
treasury, the number of Preferred Shares that will be sufficient
to permit the exercise in full of all outstanding Rights in
accordance with this Section 7.
(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 (or
former Beneficial Owner) or Affiliates or Associates thereof as
the Company shall reasonably request.
16.
<PAGE>
Section 8. Cancellation and Destruction of Right
Certificates. All Right Certificates surrendered for the purpose
of exercise, transfer, split up, combination or exchange shall,
if surrendered to the Company or to any of its agents, be
delivered to the Rights Agent for cancellation or in cancelled
form, or, if surrendered to the Rights Agent, shall be cancelled
by it, and no Right Certificates shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this
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 cancelled Right Certificates
to the Company, or shall, at the written request of the Company,
destroy such cancelled Right Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.
Section 9. Availability of Preferred Shares. (a) The
company covenants and agrees that it will use its best efforts to
cause to be reserved and kept available out of and to the extent
of its authorized and unissued shares of Preferred Stock not
reserved for another purpose (and, following the occurrence of an
event described in Section 11(a)(ii) or Section 13(a), out of its
authorized and unissued shares of Common Stock and/or other
securities), the number of Preferred Shares (and, following the
occurrence of any such event, Common Stock and/or other
securities) that will be sufficient to permit the exercise in
full of all outstanding Rights.
(b) If the Preferred Shares (or, following the
occurrence of an event described in Section 11(a)(ii) or Section
13(a), the Common Shares and/or other
17.
<PAGE>
securities) are at any time listed on a national securities
exchange or included for quotation on any transaction reporting
system, then so long as the Preferred Shares (and, following the
occurrence of any such event, Common Shares and/or other
securities) issuable and deliverable upon exercise of the Rights
may be listed on such exchange or included for quotation on any
such transaction reporting system, 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 or included for quotation
on any such transaction reporting system upon official notice of
issuance upon such exercise.
(c) The Company shall use its best efforts to
(i) file, as soon as practicable following the earliest date
after the first occurrence of an event described in Section
11(a)(ii) in which the consideration to be delivered by the
Company upon exercise of the Rights has been determined in
accordance with Section 11(a)(iv) hereof, or as soon as is
required by law following the Distribution Date, as the case may
be, a registration statement under the Securities Act of 1933, as
amended (the "Securities 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 Securities Act) until
the earlier of (A) the date as of which the Rights are no longer
exercisable for such securities or (B) the date of expiration of
the Rights. The Company may temporarily suspend, for a period
not
18.
<PAGE>
to exceed ninety (90) days after the date set forth in clause
(i) of the first sentence of this Section 9(c), the
exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective. Upon
any such suspension, the Company shall issue a public
announcement stating, and notify the Rights Agent, that the
exercisability of the Rights has been temporarily suspended, as
well as a public announcement and notification to the Rights
Agent at such time as the suspension is no longer in effect. The
Company will also take such action as may be appropriate under,
or to ensure compliance with, the securities or "blue sky" laws
of the various states in connection with the exercisability of
the Rights. Notwithstanding any provision of this Agreement to
the contrary, the Rights shall not be exercisable in any
jurisdiction, unless the requisite qualification in such
jurisdiction shall have been obtained, or an exemption therefrom
shall be available and until a registration statement has been
declared effective.
(d) The Company covenants and agrees that it will take
all such action as may be necessary to ensure that all Preferred
Shares delivered upon exercise of Rights shall, at the time of
delivery of the certificates for such Preferred Shares (subject
to payment of the Purchase Price), be duly and validly authorized
and issued and fully paid and nonassessable shares.
(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
Preferred Shares upon the exercise of Rights. The Company shall
not, however, be required to pay any transfer tax which may be
payable in respect of any transfer or delivery of Right
19.
<PAGE>
Certificates to a person other than, or the issuance or delivery
of certificates or depositary receipts for the Preferred Shares
in a name other than that of, the registered holder of the Right
Certificate evidencing Rights surrendered for exercise or to
issue or to deliver any certificates or depositary receipts for
Preferred Shares 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 reasonable
satisfaction that no such tax is due.
Section 10. Preferred Shares Record Date. Each person
in whose name any certificate for Preferred Shares is issued upon
the exercise of Rights shall for all purposes be deemed to have
become the holder of record of the Preferred Shares 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; provided, however, that if the date of
such surrender and payment is a date upon which the Preferred
Shares transfer books of the Company are closed, such person
shall be deemed to have become the record holder of such shares
on, and such certificate shall be dated, the next succeeding
Business Day on which the Preferred Shares 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 holder of Preferred 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
20.
<PAGE>
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
Preferred Shares covered by each Right and the number of Rights
outstanding are subject to adjustment from time to time as
provided in this Section 11.
(a) (i) In the event the Company shall at any time
after the date of this Agreement (A) declare a dividend on the
Preferred Shares payable in Preferred Shares, (B) subdivide the
outstanding Preferred Shares, (C) combine the outstanding
Preferred Shares into a smaller number of Preferred Shares or
(D) issue any shares of its capital stock in a reclassification
of the Preferred Shares (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), 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 capital stock issuable on such
date, shall be proportionately adjusted so that the holder of any
Right exercised after such time shall be entitled to receive 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 the Preferred Shares transfer books of the Company
were open, such holder would have owned upon such exercise and
been entitled to receive by virtue of such dividend, subdivision,
combination or reclassification; provided, however, that in no
event shall the consideration to be paid
21.
<PAGE>
upon the exercise of one Right be less than the aggregate par
value of the shares of capital stock of the Company issuable upon
exercise of one Right. If an event occurs which would require an
adjustment under both 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 that any Person becomes an Acquiring
Person, each holder of a Right shall thereafter have a right to
receive, upon exercise thereof at a price equal to the then
current Purchase Price multiplied by the number of one one-
hundredths of a Preferred Share for which a Right is then
exercisable, in accordance with the terms of this Agreement and
in lieu of Preferred Shares, such number of Common Shares of the
Company as shall equal the result obtained by (x) multiplying the
then current Purchase Price by the number of one one-hundredths
of a Preferred Share for which a Right is then exercisable and
dividing that product by (y) 50% of the then current per share
market price of the Company's Common Shares (determined pursuant
to Section 11(d) hereof) on the date of the occurrence of such
event. In the event that any Person shall become an Acquiring
Person and the Rights shall then be outstanding, the Company
shall not take any action which would eliminate or diminish the
benefits intended to be afforded by the Rights.
Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of an event in
which any Person shall become an Acquiring Person, any Rights
beneficially owned by (A) an Acquiring Person or an Associate or
Affiliate of an Acquiring Person, (B) a transferee of an
Acquiring Person (or of any such Associate
22.
<PAGE>
or Affiliate) who becomes a transferee after the Acquiring Person
becomes such, or (C) 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 (1) a transfer (whether
or not for consideration) from the Acquiring Person to holders of
equity interests in such Acquiring Person or to any Person with
whom the Acquiring Person has any continuing agreement,
arrangement or understanding regarding the transferred Rights or
(2) a transfer which the Board of Directors, upon approval by a
majority of the Continuing Directors, has determined is part of a
plan, arrangement or understanding which has as a primary purpose
or effect the avoidance of this Section 11(a)(ii), 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. No Right Certificate shall be issued pursuant to
Section 3 that represents Rights beneficially owned by an
Acquiring Person whose Rights would be void pursuant to the
preceding sentence or any Associate or Affiliate thereof; no
Right Certificate shall be issued at any time upon the transfer
of any Rights to an Acquiring Person whose Rights would be void
pursuant to the preceding sentence or any Associate or Affiliate
thereof or to any nominee of such Acquiring Person, Associate or
Affiliate; and any Right Certificate delivered to the Rights
Agent for transfer to an Acquiring Person whose Rights would be
void pursuant to the preceding sentence shall be cancelled. The
Company shall use all reasonable efforts to ensure that the
provisions of this Section 11(a)(ii) 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
23.
<PAGE>
any determinations with respect to an Acquiring person or its
Affiliates, Associates or transferees hereunder.
(iii) The right to buy Common Shares of the
Company pursuant to subparagraph (ii) of this paragraph (a) shall
not arise if the event causing such Person to become an Acquiring
Person (A) is a consolidation, merger, sale, transfer or similar
transaction subject to Section 13 hereof, or (B) is an
acquisition of shares of Common Stock pursuant to a tender offer
or an exchange offer for all outstanding Common Shares at a price
and on terms determined by at least a majority of the Continuing
Directors, and after receiving advice from one or more investment
banking firms, to be (1) at a price which is fair to stockholders
(taking into account all factors which such members of the Board
of Directors deem relevant including, without limitation, prices
which could reasonably be achieved if the Company or its assets
were sold in an orderly basis designed to realize maximum value)
and (2) otherwise in the best interests of the Company and its
stockholders.
(iv) In lieu of issuing Common Shares in
accordance with Section 11(a)(ii) hereof, the Company may, if the
Board of Directors of the Company, upon approval by a majority of
the Continuing Directors, determines that such action is
necessary or appropriate and not contrary to the interest of
holders of Rights (and, in the event that the number of Common
Shares which are authorized by the Company's Articles of
Incorporation but not outstanding or reserved for issuance for
purposes other than upon exercise of the Rights are not
sufficient to permit the exercise in full of the Rights, or if
any necessary regulatory approval for such issuance has not been
obtained
24.
<PAGE>
by the Company, the Company shall): (A) determine the excess of
(1) the value of the Common Shares issuable upon the exercise of
a Right (the "Current Value") over (2) the Purchase Price (such
excess being referred to as the "Spread") and (B) with respect to
each Right, make adequate provision to substitute for such Common
Shares, upon exercise of the Rights, (1) cash, (2) a reduction in
the Purchase Price, (3) other equity securities of the Company
(including, without limitation, shares or units of shares of any
series of preferred stock which the Board of Directors of the
Company, upon approval by a majority of the Continuing Directors,
has deemed to have the same value as Common Shares (such shares
or units of shares of preferred stock are herein called "common
stock equivalents")), except to the extent that the Company has
not obtained any necessary regulatory approval for such issuance,
(4) debt securities of the Company, except to the extent that the
Company has not obtained any necessary regulatory approval for
such issuance, (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, upon approval by a majority of the
Continuing Directors, based upon the advice of a nationally
recognized investment banking firm selected by the Board of
Directors of the Company, upon approval by a majority of the
Continuing Directors; provided, however, if the Company shall not
have made adequate provision to deliver value pursuant to clause
(B) above within thirty (30) days following the occurrence of an
event described in Section 11(a)(ii), then the Company shall be
obligated to deliver, upon the surrender for exercise of a Right
and without requiring payment of the Purchase Price, Common
Shares (to the extent
25.
<PAGE>
available), except to the extent that the Company has not
obtained any necessary regulatory approval for such issuance, and
then, if necessary, cash, which shares and/or cash have an
aggregate value equal to the Spread. If the Board of Directors,
upon approval by a majority of the Continuing Directors, shall
determine in good faith that it is likely that sufficient
additional Common Shares could be authorized for issuance upon
exercise in full of the Rights or that any necessary regulatory
approval for such issuance will 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 occurrence of an
event described in Section 11(a)(ii), in order that the Company
may seek stockholder approval for the authorization of such
additional shares or take action to obtain such regulatory
approval (such period, as it may be extended, the "Substitution
Period"). To the extent that the Company determines that some
action need be taken pursuant to the first and/or second
sentences of this Section 11(a)(iv), the Company (x) shall
provide that such action shall apply uniformly to all outstanding
Rights held by holders entitled to receive Common Shares or other
securities or property upon exercise of such 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 take any action to obtain any required
regulatory approval and/or to decide the appropriate form of
distribution to be made pursuant to such first sentence and to
determine the value thereof. In the event of any such
suspension, the Company shall issue a public announcement stating
that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the
suspension is no longer in effect and shall promptly
26.
<PAGE>
notify the Rights Agent of such suspension. For purposes of this
Section 11(a)(iv), the value of the Common Shares shall be the
current per share market price (as determined pursuant to Section
11(d) hereof) of the Common Shares at the Close of Business on
the date of the occurrence of one of the events described in
Section 11(a)(ii) and the value of any "common stock equivalent"
shall be deemed to have the same value as the Common Shares on
such date.
(b) In the event that the Company shall fix a record
date for the issuance of rights, options or warrants to all
holders of Preferred Shares entitling them (for a period expiring
within 45 calendar days after such record date) to subscribe for
or purchase Preferred Shares (or shares having the same rights,
privileges and preferences as the Preferred Shares ("equivalent
preferred shares")) or securities convertible into Preferred
Shares or equivalent preferred shares at a price per Preferred
Share or equivalent preferred share (or having a conversion price
per share, if a security convertible into Preferred Shares or
equivalent preferred shares) less than the then current per share
market price of the Preferred Shares (as defined in Section
11(d)) on such record date, the Purchase Price to be in effect
after such record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such record date by
a fraction, the numerator of which shall be the number of
Preferred Shares outstanding on such record date plus the number
of Preferred Shares which the aggregate offering price of the
total number of Preferred Shares and/or equivalent preferred
shares so to be offered (and/or the aggregate initial conversion
price of the convertible securities so to be offered) would
purchase at such current market price and the denominator of
which shall be the number
27.
<PAGE>
of Preferred Shares outstanding on such record date plus the
number of additional Preferred Shares and/or equivalent preferred
shares 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 in a
consideration part or all of which shall be in a form other than
cash, the value of such consideration shall be as determined in
good faith by the Board of Directors of the Company, upon
approval by a majority of the Continuing Directors, whose
determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent and the
holders of the Rights. Preferred Shares 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 the Preferred
Shares (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 quarterly cash dividend or a dividend
payable in Preferred Shares) or subscription rights or warrants
(excluding those referred to in Section 11(b) hereof), the
Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the
numerator of which shall be the then current per share market
price of the Preferred Shares on such record date,
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less the fair market value (as determined in good faith by the
Board of Directors of the Company, upon approval by a majority of
the Continuing Directors, 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 Preferred
Share and the denominator of which shall be such current per
share market price of the Preferred Shares. 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) (i) For the purpose of any computation
hereunder, the "current per share market price" of any security
(a "Security" for the purpose of this Section 11(d)(i)) on any
date shall be deemed to be the average of the daily closing
prices per share of such Security for the thirty (30) consecutive
Trading Days (as such term is hereinafter defined) immediately
prior to such date; provided, however, that in the event that the
current per share market price of the Security is determined
during a period following the announcement by the issuer of such
Security of (A) a dividend or distribution on such Security
payable in shares of such Security or securities convertible into
such shares, or (B) any subdivision, combination or
reclassification of such Security and prior to the expiration of
thirty (30) Trading Days 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 per share market price shall be
appropriately adjusted to reflect the current market price per
share equivalent of such Security. The
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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 Nasdaq National Market ("Nasdaq") or, if the
Security is not listed or admitted to trading on the Nasdaq, as
reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal
national securities exchange on which the Security is listed or
admitted to trading or, if the Security is 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
Nasdaq or such other system then in use, or, if on any such date
the Security is 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 Security
selected by the Board of Directors of the Company, upon approval
by a majority of the Continuing Directors. If on any such date
no market maker is making a market in the Security, the "current
per share market price" of such Security on such date as
determined in good faith by the Board of Directors of the Company
as provided for above shall be used. The term "Trading Day"
shall mean a day on which the principal national securities
exchange on which the Security is listed or admitted to trading
is open for the transaction of business or, if the Security is
not listed or admitted to trading on any national securities
exchange, a Business Day.
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(ii) For the purpose of any computation
hereunder, the "current per share market price" of the Preferred
Shares shall be determined in accordance with the method set
forth in Section 11(d)(i). If the Preferred Shares are not
publicly traded, the "current per share market price" of the
Preferred Shares shall be conclusively deemed to be the current
per share market price of the Common Shares as determined
pursuant to Section 11(d)(i) (appropriately adjusted to reflect
any stock split, stock dividend or similar transaction occurring
after the date hereof), multiplied by one hundred. If neither
the Common Shares nor the Preferred Shares are publicly held or
so listed or traded, "current per share market price" shall mean
the fair value per share as determined in good faith by the Board
of Directors of the Company, upon approval by a majority of the
Continuing Directors, whose determination shall be described in a
statement filed with the Rights Agent.
(e) No adjustment in the Purchase Price shall be
required unless such adjustment would require an increase or
decrease of at least 1% in the Purchase Price; provided, however,
that any adjustments which by reason of this Section 11(e) are
not required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under
this Section 11 shall be made to the nearest cent or to the
nearest one one-millionth of a Preferred Share or one ten-
thousandth of any other share or security as the case may be.
Notwithstanding the first sentence of this Section 11(e), any
adjustment required by this Section 11 shall be made no later
than the earlier of (i) three years from the date of the
transaction which requires such adjustment or (ii) the date of
the expiration of the right to exercise any Rights.
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(f) If as a result of an adjustment made pursuant to
Section 11(a) hereof, the holder of any Right thereafter
exercised shall become entitled to receive any shares of capital
stock of the Company other than Preferred Shares, thereafter the
number of such other shares so receivable upon exercise of any
Right shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Preferred Shares contained in
Section 11(a) through (c), inclusive, and the provisions of
Sections 7, 9, 10, 13 and 14 with respect to the Preferred Shares
shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder
shall evidence the right to purchase, at the adjusted Purchase
Price, the number of one one-hundredths of a Preferred Share
purchasable from time to time hereunder upon exercise of the
Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its
election as provided in Section 11(i), upon each adjustment of
the Purchase Price as a result of the calculations made in
Sections 11(b) and (c), each Right outstanding immediately prior
to the making of such adjustment shall thereafter evidence the
right to purchase, at the adjusted Purchase Price, that number of
one one-hundredths of a Preferred Share (calculated to the
nearest one one-millionth of a Preferred Share) obtained by (i)
multiplying (x) the number of one one-hundredths of a share
covered by a Right immediately prior to this adjustment by (y)
the Purchase Price in effect immediately prior to such adjustment
of the
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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 one one-
hundredths of a Preferred Share 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 one
one-hundredths of a Preferred Share for which a Right was
exercisable immediately prior to such adjustment. Each Right
held of record prior to such adjustment of the number of Rights
shall become that number of Rights (calculated to the nearest one
ten-thousandth) obtained by dividing the Purchase Price in effect
immediately prior to adjustment of the Purchase Price by the
Purchase Price in effect immediately after adjustment of the
Purchase Price. The Company shall make a public announcement of
its election to adjust the number of Rights, indicating the
record date for the adjustment, and, if known at the time, the
amount of the adjustment to be made. This record date may be the
date on which the Purchase Price is adjusted or any day
thereafter, but, if the 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 Section
11(i), the Company shall, as promptly as practicable, cause to be
distributed to holders of record of Right Certificates on such
record date Right Certificates evidencing, subject to Section 14
hereof, the additional Rights to which such holders shall be
entitled as a result of such adjustment, or, at the option of the
Company, shall cause to be distributed to such
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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 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 one one-hundredths of a Preferred
Share issuable upon the exercise of the Rights, the Right
Certificates theretofore and thereafter issued may continue to
express the Purchase Price and the number of one one-hundredths
of a Preferred Share 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 one one-hundredth of
the then par value, if any, of the Preferred Shares issuable upon
exercise of the Rights, the Company shall take any corporate
action which may, in the opinion of its counsel, be necessary in
order that the Company may validly and legally issue fully paid
and nonassessable Preferred Shares 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 issuing to the
holder of any Right exercised after such record date of the
Preferred Shares and other capital
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stock or securities of the Company, if any, issuable upon such
exercise over and above the Preferred Shares 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 it in its sole discretion shall determine to be
advisable in order that any consolidation or subdivision of the
Preferred Shares, issuance wholly for cash of any Preferred
Shares at less than the current market price, issuance wholly for
cash of Preferred Shares or securities which by their terms are
convertible into or exchangeable for Preferred Shares, dividends
on Preferred Shares payable in Preferred Shares or issuance of
rights, options or warrants referred to hereinabove in Section
11(b), hereafter made by the Company to holders of its Preferred
Shares shall not be taxable to such stockholders.
(n) In the event that at any time after the date of
this Agreement and prior to the Distribution Date, the Company
shall (i) declare or pay any dividend on the Common Shares
payable in Common Shares or (ii) effect a subdivision,
combination or consolidation of the Common Shares (by
reclassification or otherwise than by payment of dividends in
Common Shares) into a greater or lesser number of Common Shares,
then in any such case (A) the number of one one-hundredths of a
Preferred Share
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purchasable after such event upon proper exercise of each Right
shall be determined by multiplying the number of one one-
hundredths of a Preferred Share so purchasable immediately prior
to such event by a fraction, the numerator of which is the number
of Common Shares outstanding immediately before such event and
the denominator of which is the number of Common Shares
outstanding immediately after such event, and (B) each Common
Share outstanding immediately after such event shall have issued
with respect to it that number of Rights which each Common Share
outstanding immediately prior to such event had issued with
respect to it. The adjustments provided for in this Section
11(n) shall be made successively whenever such a dividend is
declared or paid or such a subdivision, combination or
consolidation is effected.
Section 12. Certificate of Adjusted Purchase Price or
Number of Shares. Whenever an adjustment is made as provided in
Sections 11 and 13 hereof, the Company shall promptly
(a) prepare a certificate setting forth such adjustment, and a
brief statement of the facts accounting for such adjustment, (b)
file with the Rights Agent and with each transfer agent for the
Common Shares or the Preferred Shares a copy of such
certificate and (c) mail a brief summary thereof to each holder
of a Right Certificate in accordance with Section 25 hereof.
Notwithstanding the foregoing sentence, the failure by the
Company to make such certification or give such notice shall not
affect the validity of or the force or effect of the requirement
for such adjustment. The Rights Agent shall be fully protected
in relying on any such certificate and on any adjustment
contained therein and shall not be deemed to have knowledge of
such adjustment unless and until it shall have received such
certificate.
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Section 13. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power. (a) Except as provided in Section
13(b) hereof, in the event, directly or indirectly, (1) the
Company shall consolidate with, or merge with and into, any other
Person, (2) any Person shall consolidate with the Company, or
merge with and into the Company and the Company shall be the
continuing or surviving corporation of such consolidation or
merger and, in connection with such consolidation or merger, all
or part of the Common Shares shall be changed into or exchanged
for stock or other securities of any other Person (or the
Company) or cash or any other property, or (3) the Company shall
sell or otherwise transfer (or one or more of its Subsidiaries
shall sell or otherwise transfer), in one or more transactions,
directly or indirectly, assets or earning power aggregating 50%
or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person other than
the Company or one or more of its wholly-owned Subsidiaries,
then, and in each such case, proper provision shall be made so
that (i) each holder of a Right (except as otherwise provided
herein) shall thereafter have the right to receive, upon the
exercise thereof at a price equal to the then current Purchase
Price multiplied by the number of one one-hundredths of a
Preferred Share for which a Right is then exercisable, in
accordance with the terms of this Agreement and in lieu of
Preferred Shares, such number of Common Shares of such other
Person (including the Company as successor thereto or as the
surviving corporation) as shall equal the result obtained by (A)
multiplying the then current Purchase Price by the number of one
one-hundredths of a Preferred Share for which a Right is then
exercisable and dividing that product by (B) 50% of the then
current per share market price of the Common Shares
37.
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of such other Person (determined pursuant to Section 11(d)
hereof) on the date of consummation of such consolidation,
merger, sale or transfer; (ii) the issuer of such Common Shares
shall thereafter be liable for, and shall assume, by virtue of
such consolidation, merger, sale or transfer, all the obligations
and duties of the Company pursuant to this Agreement; (iii) the
term "Company" shall thereafter be deemed to refer to such
issuer; and (iv) such issuer shall take such steps (including,
but not limited to, the reservation of a sufficient number of its
Common Shares in accordance with Section 9 hereof) 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 Common Shares thereafter
deliverable upon the exercise of the Rights. The Company shall
not consummate any such consolidation, merger, sale or transfer
unless prior thereto the Company and such issuer shall have
executed and delivered to the Rights Agent a supplemental
agreement so providing. The Company shall not enter into any
transaction of the kind referred to in this Section 13 if at the
time of such transaction there are any rights, warrants,
instruments or securities outstanding or any agreements or
arrangements which, as a result of the consummation of such
transaction, would eliminate or substantially diminish the
benefits intended to be afforded by the Rights. The provisions
of this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers.
The supplemental agreement referred to above in this
Section 13(a) to be entered into by the Company and the Rights
Agent shall also provide that, as soon as
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practicable after the date of any of the events described in
Section 13(a), such issuer shall:
(i) prepare and file a registration statement
under the Securities Act with respect to the Rights and the
securities purchasable upon exercise of the Rights on an
appropriate form, use its best efforts to cause such registration
statement to become effective as soon as practicable after such
filing and use its best efforts to cause such registration
statement to remain effective (with a prospectus at all times
meeting the requirements of the Securities Act) until the Final
Expiration Date, and similarly comply with applicable state
securities laws;
(ii) use its best efforts to list (or continue
the listing of) the Rights and the securities purchasable upon
exercise of the Rights on a national securities exchange or to
meet the eligibility requirements for quotation on Nasdaq; and
(iii) deliver to holders of the Rights historical
financial statements for such issuer which comply in all respects
with the requirements for registration on Form 10 (or any
successor form) under the Exchange Act.
(b) In the event of any merger or other acquisition
transaction involving the Company pursuant to an agreement
described in Section 1(c)(ii)(A)(2), the provisions of Section
13(a) hereof shall not be applicable to such transaction and this
Rights Agreement and the rights of holders of Rights hereunder
shall be terminated in accordance with Section 7(a) hereof.
(c) The term "issuer," for purposes of this
Section 13, shall refer to the Person (or Affiliate or Associate)
referred to in Section 13(a); provided, however, that (i) if
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such Person (or Affiliate or Associate) is a direct or indirect
Subsidiary of another Person, the term "issuer" shall refer to
such other Person, and (ii) in case such Person is a Subsidiary,
directly or indirectly, of more than one Person, the term
"issuer" shall refer to whichever of such Persons is the issuer
of such Common Shares having the greatest aggregate value.
(d) If, for any reason, the Rights cannot be exercised
for Common Shares of such issuer as provided in Section 13(a),
then each holder of Rights shall have the right to exchange its
Rights for cash from such issuer in an amount equal to the number
of Common Shares that it would otherwise be entitled to purchase
multiplied by 50% of the current per share market price, as
determined pursuant to Section 11(d) hereof, of such Common
Shares of such issuer. If, for any reason, the foregoing
provision cannot be applied to determine the cash amount into
which the Rights are exchangeable, then the Board of Directors of
the Company, upon approval by a majority of the Continuing
Directors, based upon the advice of one or more nationally
recognized investment banking firms, shall determine such amount
reasonably and with good faith to the holders of Rights. Any
such determination shall be final and binding on the Rights Agent
and the holders of Rights.
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, there
shall be paid 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
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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 Nasdaq or, if the
Rights are not listed or admitted to trading on the Nasdaq, 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, upon approval by a
majority of the Continuing Directors. 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, upon approval by a
majority of the Continuing Directors, shall be used.
(b) The Company shall not be required to issue
fractions of Preferred Shares (other than fractions which are
integral multiples of one one-hundredth of a
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Preferred Share) upon exercise of the Rights or to distribute
certificates which evidence fractional Preferred Shares (other
than fractions which are integral multiples of one one-hundredth
of a Preferred Share). Fractions of Preferred Shares in integral
multiples of one one-hundredth of a Preferred Share may, at the
election of the Company, be evidenced by depositary receipts,
pursuant to an appropriate agreement between the Company and a
depositary selected by it; provided, that such agreement shall
provide that the holders of such depositary receipts shall have
all the rights, privileges and preferences to which they are
entitled as beneficial owners of the Preferred Shares represented
by such depositary receipts. In lieu of fractional Preferred
Shares that are not integral multiples of one one-hundredth of a
Preferred Share, the Company shall pay to the registered holders
of Right Certificates at the time such Rights are exercised as
herein provided an amount in cash equal to the same fraction of
the current market value of one Preferred Share. For the
purposes of this Section 14(b), the current market value of a
Preferred Share shall be the closing price of a Preferred Share
(as determined pursuant to the second sentence of Section
11(d)(i) hereof) for the Trading Day immediately prior to the
date of such exercise.
(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 of a Right (except as
provided above).
Section 15. Rights of Action. All rights of action in
respect of this Agreement, excepting the rights of action given
to the Rights Agent under Section 18 hereof, are vested in the
respective registered holders of the Right Certificates (and,
prior
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to the Distribution Date, the registered holders of the Common
Shares); and any registered holder of any Right Certificate (or,
prior to the Distribution Date, of the Common Shares), 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 Shares), may, in such holder's own behalf and for such
holder's own benefit, enforce, and may institute and maintain any
suit, action or proceeding against the Company to enforce, or
otherwise act in respect of, such holder's right to exercise 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 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
Shares;
(b) after the Distribution Date, the Right
Certificates are transferable only on the registry books of the
Rights Agent if surrendered at the principal office of the Rights
Agent, duly endorsed or accompanied by a proper instrument of
transfer; and
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(c) subject to Sections 6 and 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 Shares 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 Shares certificate
made by anyone other than the Company or the Rights Agent) for
all purposes whatsoever, and neither the Company nor the Rights
Agent shall be affected by any notice to the contrary.
(d) notwithstanding anything in this Agreement to the
contrary, neither the Company nor the Rights Agent shall have any
liability to any holder of a Right or other Person as a result of
its inability to perform any of its obligations under this
Agreement by reason of any preliminary or permanent injunction or
other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative
agency or commission, or any statute, rule, regulation or
executive order promulgated or enacted by any governmental
authority, prohibiting or otherwise restraining performance of
such obligation; provided, however, the Company must use its best
efforts to have any such order, decree or ruling lifted or
otherwise overturned as soon as possible.
Section 17. 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 Preferred Shares or any other
securities of the Company which may at any time be issuable on
the exercise of the Rights represented
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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 hereof), or to
receive dividends or subscription rights, or otherwise, until the
Right or Rights evidenced by such Right Certificate shall have
been exercised in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent. 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 gross negligence, bad
faith or willful misconduct on the part of the Rights Agent, for
any action taken, suffered or omitted by the Rights Agent in
connection with the execution, acceptance and administration of
this Agreement and the exercise and performance hereunder of its
duties, including the costs and expenses of defending against and
appealing any claim of liability in the premises. The indemnity
provided herein shall survive the termination of this Agreement
and the expiration of the Rights.
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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 and the exercise and performance of its duties
hereunder in reliance upon any Right Certificate or certificate
for the Preferred Shares or Common Shares or for other securities
of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction,
consent, certificate, statement, or other paper or document
believed by it to be genuine and to be signed, executed and,
where necessary, verified or acknowledged, by the proper person
or persons, or otherwise upon the advice of counsel as set forth
in Section 20 hereof.
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
stock transfer or 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 hereof. 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 Rights Agent and deliver such
Right Certificates so countersigned; and in
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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 of
its choice (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,
suffered or omitted by it in good faith and in accordance with
such opinion.
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(b) Whenever in the administration, exercise and
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, suffering
or omitting 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 Chief Executive Officer, the 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, suffered
or omitted in good faith by it under the provisions of this
Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder to the
Company and any other Person only for its own negligence, bad
faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained in
this Agreement or in the 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 liability
or responsibility in respect of the legality, validity or
enforceability of this Agreement or the execution and delivery
hereof (except the due execution hereof by the Rights Agent) or
in respect of the legality, validity or enforceability or the
execution of any Right Certificate (except its countersignature
thereof); nor shall it be liable or responsible for any breach by
the Company
48.
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of any covenant or condition contained in this Agreement or in
any Right Certificate; nor shall it be responsible for any change
in the exercisability of the Rights (including the Rights
becoming void pursuant to Section 11(a)(ii) hereof) or any
adjustment in the terms of the Rights (including the manner,
method or amount thereof) provided for in Section 3, 11, 13, 23
or 24, or the ascertaining of the existence of facts that would
require any such change or adjustment (except with respect to the
exercise of Rights evidenced by Right Certificates after receipt
of the certificate described in Section 12 hereof); nor shall it
by any act hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any Preferred
Shares to be issued pursuant to this Agreement or any Right
Certificate or as to whether any Preferred Shares 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 administration,
exercise and performance of its duties hereunder from any one of
the Chairman of the Board, the Chief Executive Officer, the
President, any Vice President, the Secretary or the Treasurer of
the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be
responsible or liable for any action taken, suffered or omitted
by it in good faith in
49.
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accordance with instructions of any such officer or for any delay
in acting while waiting for those instructions. Any application
by the Rights Agent for written instructions from the Company
may, at the option of the Rights Agent, set forth in writing any
action proposed to be taken or omitted by the Rights Agent under
this Rights Agreement and the date on and/or after which such
action shall be taken or such omission shall be effective. The
Rights Agent shall not be liable for any action taken by, or
omission of, the Rights Agent in accordance with a proposal
included in any such application on or after the date specified
in such application (which date shall not be less than five (5)
Business Days after the date any officer of the Company actually
received such application, unless any such officer shall have
consented in writing to an earlier date) unless, prior to taking
any such action (or the effective date in the case of an
omission), the Rights Agent shall have received written
instructions in response to such application specifying the
action 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 itself or by or through
50.
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its attorneys or agents, and the Rights Agent shall not be
answerable or accountable for any act, default, neglect or
misconduct of any such attorneys or agents or for any loss to the
Company resulting from any such act, default, neglect or
misconduct, provided reasonable care was exercised in the
selection and continued employment thereof.
(j) No provision of this Agreement shall require the
Rights Agent to expend or risk its own funds or otherwise incur
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, transfer, split up,
combination or exchange, the certification on the form of
assignment or form of election to purchase, as the case may be,
that the Rights evidenced by the Right Certificate are not owned
by an Acquiring Person, or an Affiliate or Associate thereof, has
either not been completed or in any manner indicates any other
response thereto, the Rights Agent shall not take any further
action with respect to such requested exercise, transfer, split
up, combination or exchange, without first consulting with the
Company.
Section 21. Change of Rights Agent. The Rights Agent
or any successor Rights Agent may resign and be discharged from
its duties under this Agreement upon thirty (30) days' notice in
writing mailed to the Company and to each transfer agent of the
Common Shares or Preferred Shares (as to which the Rights Agent
has received prior written notice) by registered or certified
mail, and the Company shall mail notice thereof
51.
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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 Shares or Preferred Shares
(as to which the Rights Agent has received prior written notice)
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 such holder's Right Certificate for inspection by the
Company), then 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 any state of the United States so long as
such corporation is authorized to do business as a banking
institution, is in good standing, and is authorized under such
laws to exercise corporate trust or stock transfer powers and is
subject to supervision or examination by federal or state
authority and which has at the time of its appointment as Rights
Agent a combined capital and surplus of at least $50 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
52.
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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 Shares or Preferred Shares,
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.
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, upon approval by a majority
of the Continuing 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 Common Shares following the Distribution Date and prior to the
redemption or expiration of the Rights, the Company (a) shall,
with respect to Common Shares so issued or sold pursuant to the
exercise of stock options or under any employee benefit plan or
arrangement or upon the exercise, conversion or exchange of
securities of the Company currently outstanding or issued at any
time in the future by the Company and (b) may, in any other case,
if deemed necessary or appropriate by the
53.
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Board of Directors of the Company, upon approval by a majority of
the Continuing Directors, 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 and this sentence shall be null and void
ab initio if, and to the extent that, such issuance or this
sentence would create a significant risk of or result in material
adverse tax consequences to the Company or the Person to whom
such Right Certificate would be issued or would create a
significant risk of or result in such options' or employee plans'
or arrangements' failing to qualify for otherwise available
special tax treatment 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. (a) The Company may, at its
option, upon approval by a majority of the Continuing Directors,
at any time prior to the earliest of (i) the tenth business day
following the Shares Acquisition Date, or (ii) such date or dates
on or after the tenth business day following the Shares
Acquisition Date to which such option may be extended by a
majority of the Continuing Directors (for one or more successive
10 day periods) by vote(s) first taken or written consent(s)
first given prior to the tenth business day following the Shares
Acquisition Date and, thereafter, prior to the completion of any
such 10 day extension or extensions (or, if the Shares
Acquisition Date shall have occurred prior to the Record Date,
prior to (A) the tenth business day following the Record Date or
(B) such date or dates on or after the tenth business day after
the Record Date to which such option may be extended by a
majority of the Continuing Directors (for one or more successive
10 day periods) by vote(s) first taken or written
54.
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consent(s) first given prior to the tenth business day following
the Record Date and, thereafter, prior to the completion of any
such 10 day extension or extensions), redeem all but not less
than all the then outstanding Rights at a redemption price of
$.01 per Right, appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the
date hereof (such redemption price being hereinafter referred to
as the "Redemption Price"), and the Company may, at its option,
pay the Redemption Price either in cash, Common Shares (based on
the current per share market price thereof (as determined
pursuant to Section 11(d) hereof) at the time of redemption), or
any other form of consideration deemed appropriate by the Board
of Directors. The redemption of the Rights by the Board of
Directors may be made effective at such time on such basis and
with such conditions as the Board of Directors in its sole
discretion may establish, upon approval by a majority of the
Continuing Directors.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the redemption of the Rights
pursuant to paragraph (a) of this Section 23, 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. The
Company shall promptly give public notice of any such redemption;
provided, however, that the failure to give, or any defect in,
any such notice shall not affect the validity of such redemption.
Within 10 days after such action of the Board of Directors
ordering the redemption of the Rights, the Company shall give
notice of such redemption to the Rights Agent and shall mail a
notice of redemption to all the holders of the then outstanding
Rights at their last addresses as they appear upon the
55.
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registry books of the Rights Agent or, prior to the Distribution
Date, on the registry books of the transfer agent for the Common
Shares. 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
or in Section 24 hereof, and other than in connection with the
purchase of Common Shares prior to the Distribution Date.
Section 24. Exchange. (a) The Company, at its option,
upon approval by a majority of the Continuing Directors, at any
time after any Person becomes an Acquiring Person, may 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 11(a)(ii) hereof) for Common Shares at an
exchange ratio of one Common Share per Right, appropriately
adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof (such exchange ratio
being hereinafter referred to as the "Exchange Ratio").
Notwithstanding the foregoing, the Board of Directors shall not
be empowered to effect such exchange at any time after any Person
(other than the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or any such Subsidiary, or
any entity holding Common Shares for or pursuant to the terms of
any such plan), together with all Affiliates and Associates of
such Person, becomes the Beneficial Owner of 50% or more of the
Common Shares then outstanding.
56.
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(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 Common Shares
equal to the number of such Rights held by such holder multiplied
by the Exchange Ratio. The Company shall promptly give public
notice of any such exchange; provided, however that the failure
to give, or any defect in, such notice shall not affect the
validity of such exchange. The Company promptly shall mail a
notice of any such exchange to all of the holders of such Rights
at their last addresses as they appear upon the registry books of
the Rights Agent. Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of exchange will state the
method by which the exchange of the Common Shares for Rights will
be effected and, in the event of any partial exchange, the number
of Rights which will be exchanged. Any partial exchange shall be
effected pro rata based on the number of Rights (other than
Rights which have become void pursuant to the provisions of
Section 11(a)(ii) hereof) held by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the
Company, at its option, may substitute Preferred Shares (or
equivalent preferred shares, as such term is defined in Section
11(b) hereof) for Common Shares exchangeable for Rights, at the
initial rate of one one-hundredth of a Preferred Share (or
equivalent preferred share) for each Common Share, as
appropriately adjusted to reflect adjustments in the voting
rights of the Preferred Shares pursuant to the terms thereof, so
that the fraction of a Preferred
57.
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Share delivered in lieu of each Common Share shall have the same
voting rights as one Common Share.
(d) In the event that there shall not be sufficient
Common Shares or Preferred Shares issued but not outstanding or
authorized but unissued to permit any exchange of Rights as
contemplated in accordance with Section 24(a), the Company shall
either take such action as may be necessary to authorize
additional Common Shares or Preferred Shares for issuance upon
exchange of the Rights or alternatively, at the option of the
Board of Directors, upon approval by a majority of the Continuing
Directors, with respect to each Right (i) pay cash in an amount
equal to the Purchase Price, in lieu of issuing Common Shares or
Preferred Shares in exchange therefor, or (ii) issue debt or
equity securities, or a combination thereof, having a value equal
to the Current Value (as hereinafter defined) of the Common
Shares or Preferred Shares exchangeable for each such Right,
where the value of such securities shall be determined by a
nationally recognized investment banking firm selected by the
Board of Directors, upon approval by a majority of the Continuing
Directors, or (iii) deliver any combination of cash, property,
Common Shares, Preferred Shares and/or other securities having a
value equal to the Current Value in exchange for each Right. The
term "Current Value", for the purposes of this Section 24, shall
mean the product of the current per share market price of Common
Shares (determined pursuant to Section 11(d) on the date of the
occurrence of the event described above in subparagraph (a))
multiplied by the number of Common Shares for which the Right
otherwise would be exchangeable if there were sufficient shares
available. To the extent that the Company determines that some
action need be taken pursuant to
58.
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clauses (i), (ii) or (iii) of this Section 24(d), the Board of
Directors, upon approval by a majority of the Continuing
Directors, may temporarily suspend the exercisability of the
Rights for a period of up to sixty (60) days following the date
on which the event described in Section 24(a) shall have
occurred, in order to seek any authorization of additional Common
Shares or Preferred Shares and/or to decide the appropriate form
of distribution to be made pursuant to the above provision and to
determine the value thereof. In the event of any such
suspension, the Company shall issue a public announcement stating
that the exercisability of the Rights has been temporarily
suspended.
(e) The Company shall not be required to issue
fractions of Common Shares or to distribute certificates which
evidence fractional Common Shares. In lieu of such fractional
Common Shares, the Company shall pay to the registered holders of
the Right Certificates with regard to which such fractional
Common Shares would otherwise be issuable an amount in cash equal
to the same fraction of the current market value of a whole
Common Share. For the purposes of this paragraph (e), the
current market value of a whole Common Share shall be the closing
price of a Common Share (as determined pursuant to the second
sentence of Section 11(d)(i) hereof) for the Trading Day
immediately prior to the date of exchange pursuant to this
Section 24.
Section 25. Notice of Certain Events. (a) In case the
Company shall propose (i) to pay any dividend payable in stock of
any class to the holders of its Preferred Shares or to make any
other distribution to the holders of its Preferred Shares (other
than a regular quarterly cash dividend), (ii) to offer to the
holders of its Preferred
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Shares rights or warrants to subscribe for or to purchase any
additional Preferred Shares or shares of stock of any class or
any other securities, rights or options, (iii) to effect any
reclassification of its Preferred Shares (other than a
reclassification involving only the subdivision of outstanding
Preferred Shares), (iv) to effect any consolidation or merger
into or with, 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 50% or more of
the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to, any other Person, (v) to effect the
liquidation, dissolution or winding up of the Company, or (vi) to
declare or pay any dividend on the Common Shares payable in
Common Shares or to effect a subdivision, combination or
consolidation of the Common Shares (by reclassification or
otherwise than by payment of dividends in Common Shares), then,
in each such case, the Company shall give to each holder of a
Right Certificate, in accordance with Section 26 hereof, a notice
of such proposed action, which shall specify the record date for
the purposes of such stock dividend, or distribution of rights or
warrants, or the date on which such reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution,
or winding up is to take place and the date of participation
therein by the holders of the Common Shares and/or Preferred
Shares, if any such date is to be fixed, and such notice shall be
so given in the case of any action covered by clause (i) or (ii)
above at least ten (10) days prior to the record date for
determining holders of the Preferred Shares for purposes of such
action, and in the case of any such other action, at least ten
(10) days prior to the date of the taking of such proposed action
60.
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or the date of participation therein by the holders of the Common
Shares and/or Preferred Shares, whichever shall be the earlier.
(b) In case any of the events set forth in Section
11(a)(ii) hereof shall occur, then the Company shall as soon as
practicable thereafter give to each holder of a Right
Certificate, in accordance with Section 26 hereof, a notice of
the occurrence of such event, which notice shall describe such
event and the consequences of such event to holders of Rights
under Section 11(a)(ii) hereof. In the event any Person becomes
an Acquiring Person, the Company will promptly notify the Rights
Agent thereof.
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 (until another address is filed in writing
with the Rights Agent) as follows:
SEEQ Technology Incorporated
47200 Bayside Parkway
Fremont, California 94538
Attention: Phillip J. Salsbury
President and Chief Executive Officer
Subject to the provisions of Section 21 hereof, 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:
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American Stock Transfer & Trust Company
40 Wall Street
New York, New York 10005
Attention: Compliance Department
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
Distribution Date, the Company may supplement or amend this
Agreement in any respect, without the approval of any holders of
Rights, by action of its Board of Directors upon approval by a
majority of the Continuing Directors, and the Rights Agent shall,
if the Company so directs, execute such supplement or amendment.
From and after the Distribution Date, the Company may from time
to time supplement or amend this Agreement without the approval
of any holders of Rights, by action of its Board of Directors,
upon approval by a majority of the Continuing Directors, in order
to cure any ambiguity, to correct or supplement any provision
contained herein which may be defective or inconsistent with any
other provisions herein, or to make any other provisions with
respect to the Rights which the Company may deem necessary or
desirable and which shall be consistent with, and for the purpose
of fulfilling, the objectives of the Board of Directors in
adopting this Agreement, including, without limitation, to change
the Purchase Price, the Redemption Price, any time periods herein
specified, and any other term hereof, any such supplement or
amendment to be evidenced by a writing signed by the Company and
the Rights
62.
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Agent; provided, however, that from and after such time as any
Person becomes an Acquiring Person, this Agreement shall not be
amended in any manner which would adversely affect the interests
of the holders of Rights. Upon receipt of a certificate from an
appropriate officer of the Company that the proposed supplement
or amendment is consistent with this Section 27 and, after such
time as any Person has become an Acquiring Person, that the
proposed supplement or amendment does not adversely affect the
interests of the holders of Rights, the Rights Agent shall
execute such supplement or amendment. Without limiting the
foregoing, the Company may at any time prior to such time as any
Person becomes an Acquiring Person, by action of its Board of
Directors, upon approval by a majority of the Continuing
Directors, amend this Agreement to lower the thresholds set forth
in Sections 1(a) and 3(a) to not less than the greater of (i) any
percentage greater than the largest percentage of the outstanding
Common Shares then known by the Company to be beneficially owned
by any Person (other than the Company, any Subsidiary of the
Company, any employee benefit plan of the Company or any
Subsidiary of the Company, or any entity holding Common Shares
for or pursuant to the terms of any such plan) and (ii) 10%.
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 Common Shares outstanding at any particular
time, including for purposes of determining the particular
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percentage of such outstanding Common Shares of which any Person
is the Beneficial Owner, shall be made in accordance with the
last sentence of Rule 13d-3(d)(1)(i) of the General Rules and
Regulations under the Exchange Act. The Board of Directors of
the Company (and, where specifically provided for herein, only
upon approval by a majority of the Continuing Directors) 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). All such actions,
calculations, interpretations and determinations (including, for
purposes of clause (y) below, all omissions with respect to the
foregoing), which are done or made by the Board (or, where
specifically provided for herein, upon approval by a majority of
the Continuing Directors) in good faith, shall (x) be final,
conclusive and binding on the Company, the Rights Agent, the
holders of the Right Certificates and all other parties and (y)
not subject the Board or the Continuing Directors to any
liability to the holders of the Rights.
Section 30. Benefits of This Agreement. Nothing in
this Agreement shall be construed to give to any person or
corporation other than the Company, the Rights Agent and the
registered holders of the Right Certificates (and, prior to the
Distribution Date, the Common Shares) any legal or equitable
right, remedy or claim under this Agreement; but this Agreement
shall be for the sole and exclusive benefit of the
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Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the Common
Shares).
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,
upon approval by a majority of the Continuing Directors,
determines in its good faith judgment that severing the invalid
language from this Agreement would adversely affect the purpose
or effect of this Agreement, the right of redemption set forth in
Section 23 hereof shall be reinstated and shall not expire until
the tenth business day following the date of such determination
by the Board of Directors of the Company.
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.
Section 33. Counterparts. This Agreement may be
executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed
65.
<PAGE>
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
or convenience only and shall not control or affect the meaning
or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and attested, all as of the day and
year first above written.
ATTEST: SEEQ TECHNOLOGY INCORPORATED
By RALPH J. HARMS By PHILLIP J. SALSBURY
_________________________ __________________________
Name: Ralph J. Harms Name: Phillip J. Salsbury
Title: Vice President Title: President and Chief
Finance and Executive Officer
Administration,
Chief Financial Officer
and Secretary
ATTEST: AMERICAN STOCK TRANSFER & TRUST
COMPANY
By ISAAC J. KAGAN By HERBERT J. LEMMER
_________________________ ____________________________
Name: Isaac J. Kagan Name: Herbert J. Lemmer
Title: Vice President Title: Vice President
66.
<PAGE>
Exhibit A
FORM
of
CERTIFICATE OF DESIGNATIONS
of
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
of
SEEQ TECHNOLOGY INCORPORATED
(Pursuant to Section 151 of the
Delaware General Corporation Law)
__________________________________
SEEQ Technology Incorporated, a corporation organized
and existing under the General Corporation Law of the State of
Delaware (hereinafter called the "Corporation"), hereby certifies
that the following resolution was adopted by the Board of
Directors of the Corporation as required by Section 151 of the
General Corporation Law at meetings duly called and held on
April 18, 1995 and April 21, 1995:
RESOLVED, that pursuant to the authority granted to and
vested in the Board of Directors of the Corporation (hereinafter
called the "Board of Directors" or the "Board") in accordance
with the provisions of the Certificate of Incorporation, the
Board of Directors hereby creates a series of Preferred Stock,
par value $.01 per share (the "Preferred Stock"), of the
Corporation and hereby states the designation and number of
shares, and fixes the relative rights, preferences, and
limitations thereof as follows:
Series A Junior Participating Preferred Stock:
Section 1. Designation and Amount. The shares of such
series shall be designated as "Series A Junior Participating
Preferred Stock" (the "Series A Preferred Stock") and the number
of shares constituting the Series A Preferred Stock shall be
Three Hundred Fifty Thousand (350,000). Such number of shares
may be increased or decreased by resolution of the Board of
Directors; provided, that no decrease shall reduce the
A-1
<PAGE>
number of shares of Series A Preferred Stock to a number less
than the number of shares then outstanding plus the number of
shares reserved for issuance upon the exercise of outstanding
options, rights or warrants or upon the conversion of any
outstanding securities issued by the Corporation convertible into
Series A Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares
of any series of Preferred Stock (or any similar stock) ranking
prior and superior to the Series A Preferred Stock with respect
to dividends, the holders of shares of Series A Preferred Stock,
in preference to the holders of the Common Stock, par value $.01
per share (the "Common Stock"), of the Corporation, and of any
other junior stock, shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available
for the purpose, quarterly dividends payable in cash on the first
day of March, June, September and December in each year (each
such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a
share of Series A Preferred Stock, in an amount per share
(rounded to the nearest cent) equal to, subject to the provision
for adjustment hereinafter set forth, 100 times the aggregate per
share amount of all cash dividends, and 100 times the aggregate
per share amount (payable in kind) of all non-cash dividends or
other distributions, other than a dividend payable in shares of
Common Stock or a subdivision of the outstanding shares of Common
Stock (by reclassification or otherwise), declared on the Common
Stock since the immediately preceding Quarterly Dividend Payment
Date or, with respect to the first Quarterly Dividend Payment
Date, since the first issuance of any share or fraction of a
share of Series A Preferred Stock. In the event the Corporation
shall at any time declare or pay any dividend on the Common Stock
payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the
amount to which holders of shares of Series A Preferred Stock
were entitled immediately prior to such event under clause (b) of
the preceding sentence shall be adjusted by multiplying such
amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event
and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or
distribution on the Series A Preferred Stock as provided in
paragraph (A) of this Section immediately after it declares a
dividend or distribution on the Common Stock (other than a
dividend payable in shares of Common Stock).
A-2
<PAGE>
(C) Dividends shall begin to accrue and be cumulative
on outstanding shares of Series A Preferred Stock from the
Quarterly Dividend Payment Date next preceding the date of issue
of such shares, unless the date of issue of such shares is prior
to the record date for the first Quarterly Dividend Payment Date,
in which case dividends on such shares shall begin to accrue from
the date of issue of such shares, or unless the date of issue is
a Quarterly Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series A
Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of which
events such dividends shall begin to accrue and be cumulative
from such Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares
of Series A Preferred Stock in an amount less than the total
amount of such dividends at the time accrued and payable on such
shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders
of shares of Series A Preferred Stock entitled to receive payment
of a dividend or distribution declared thereon, which record date
shall be not more than 60 days prior to the date fixed for the
payment thereof.
Section 3. Voting Rights. The holders of shares of
Series A Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment
hereinafter set forth, each share of Series A Preferred Stock
shall entitle the holder thereof to 100 votes on all matters
submitted to a vote of the stockholders of the Corporation. In
the event the Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common Stock,
or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the number of votes per share to which
holders of shares of Series A Preferred Stock were entitled
immediately prior to such event shall be adjusted by multiplying
such number by a fraction, the numerator of which is the number
of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such
event.
(B) Except as otherwise provided herein, in any other
Certificate of Designations creating a series of Preferred Stock
or any similar stock, or by law, the holders of shares of Series
A Preferred Stock and the holders of shares of Common Stock and
any other capital stock of the Corporation having general voting
rights shall vote together as one class on all matters submitted
to a vote of stockholders of the Corporation.
A-3
<PAGE>
(C) Except as set forth herein, or as otherwise
provided by law, holders of Series A Preferred Stock shall have
no special voting rights and their consent shall not be required
(except to the extent they are entitled to vote with holders of
Common Stock as set forth herein) for taking any corporate
action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided
in Section 2 are in arrears, thereafter and until all accrued and
unpaid dividends and distributions, whether or not declared, on
shares of Series A Preferred Stock outstanding shall have been
paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either as
to dividends or upon liquidation, dissolution or winding up) to
the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding up)
with the Series A Preferred Stock, except dividends paid ratably
on the Series A Preferred Stock and all such parity stock on
which dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares are then
entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock, provided that the Corporation may at
any time redeem, purchase or otherwise acquire shares of any such
junior stock in exchange for shares of any stock of the
Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A Preferred
Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock, or any
shares of stock ranking on a parity with the Series A Preferred
Stock, except in accordance with a purchase offer made in writing
or by publication (as determined by the Board of Directors) to
all holders of such shares upon such terms as the Board of
Directors, after consideration of the respective annual dividend
rates and other relative rights and preferences of the respective
series and classes, shall determine in good faith will result in
fair and equitable treatment among the respective series or
classes.
(B) The Corporation shall not permit any subsidiary of
the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the
A-4
<PAGE>
Corporation unless the Corporation could, under
paragraph (A) of this Section 4, purchase or otherwise acquire
such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A
Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired and
cancelled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but
unissued shares of Preferred Stock and may be reissued as part of
a new series of Preferred Stock subject to the conditions and
restrictions on issuance set forth herein, in the Certificate of
Incorporation, or in any other Certificate of Designations
creating a series of Preferred Stock or any similar stock or as
otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up.
Upon any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (1) to the holders of
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred
Stock unless, prior thereto, the holders of shares of Series A
Preferred Stock shall have received $100 per share, plus an
amount equal to accrued and unpaid dividends and distributions
thereon, whether or not declared, to the date of such payment,
provided that the holders of shares of Series A Preferred Stock
shall be entitled to receive an aggregate amount per share,
subject to the provision for adjustment hereinafter set forth,
equal to 100 times the aggregate amount to be distributed per
share to holders of shares of Common Stock, or (2) to the holders
of shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except distributions made ratably on the Series
A Preferred Stock and all such parity stock in proportion to the
total amounts to which the holders of all such shares are
entitled upon such liquidation, dissolution or winding up. In
the event the Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common Stock,
or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the aggregate amount to which holders of
shares of Series A Preferred Stock were entitled immediately
prior to such event under the proviso in clause (1) of the
preceding sentence shall be adjusted by multiplying such amount
by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common
Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case
each share of Series A Preferred Stock shall at the same time be
similarly exchanged or changed into an amount per share, subject
to the provision for adjustment hereinafter set forth, equal to
100 times the aggregate
A-5
<PAGE>
amount of stock, securities, cash and/or any other property
(payable in kind), as the case may be, into which or for which
each share of Common Stock is changed or exchanged. In the event
the Corporation shall at any time declare or pay any dividend on
the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater
or lesser number of shares of Common Stock, then in each such
case the amount set forth in the preceding sentence with respect
to the exchange or change of shares of Series A Preferred Stock
shall be adjusted by multiplying such amount by a fraction, the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series A
Preferred Stock shall not be redeemable.
Section 9. Rank. The Series A Preferred Stock shall
rank, with respect to the payment of dividends and the
distribution of assets, junior to all series of any other class
of the Corporation's Preferred Stock.
Section 10. Amendment. The Certificate of
Incorporation of the Corporation shall not be amended in any
manner which would materially alter or change the powers,
preferences or special rights of the Series A Preferred Stock so
as to affect them adversely without the affirmative vote of the
holders of at least a majority of the outstanding shares of
Series A Preferred Stock, voting together as a single class.
IN WITNESS WHEREOF, this Certificate of Designations is
executed on behalf of the Corporation by its President and Chief
Executive Officer and its corporate seal attested by its
Secretary this day of April, 1995.
PHILLIP J. SALSBURY
______________________________________
Name: Phillip J. Salsbury
Title: President and Chief Executive
Officer
[SEAL]
Attest:
RALPH J. HARMS
_______________________
Ralph J. Harms,
Vice President, Finance
and Administration,
Chief Financial Officer
and Secretary
A-6
<PAGE>
Exhibit B
Form of Right Certificate
Certificate No. R-
___________ Rights
NOT EXERCISABLE AFTER MAY 2, 2005 OR EARLIER IF
REDEMPTION OR EXCHANGE OCCURS. 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 BENEFICIALLY OWNED BY AN ACQUIRING
PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS
SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND ANY
SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND VOID. [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 SUCH
AGREEMENT.]*_/
Right Certificate
SEEQ TECHNOLOGY INCORPORATED
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
April 21, 1995 (the "Rights Agreement"), between SEEQ Technology
Incorporated, a Delaware corporation (the "Company"), and
American Stock Transfer & Trust Company (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., New York, New York
_______________
*_/ The portion of the legend in bracket shall be inserted
only if applicable and shall replace the preceding sentence.
B-1
<PAGE>
time, on May 2, 2005, at the office of the Rights Agent
designated for such purpose, or at the office of its successor as
Rights Agent, one one-hundredth of a fully paid non-assessable
share of Series A Junior Participating Preferred Stock, par value
$.01 per share (the "Preferred Shares") of the Company, at a
purchase price of $15 per one one-hundredth of a Preferred Share
(the "Purchase Price"), upon presentation and surrender of this
Right Certificate with the Form of Election to Purchase duly
executed. The number of Rights evidenced by this Right
Certificate (and the number of one one-hundredths of a Preferred
Share which may be purchased upon exercise hereof) set forth
above, and the Purchase Price set forth above, are the number and
Purchase Price as of May 2, 1995 based on the Preferred Shares as
constituted at such date. As provided in the Rights Agreement,
the Purchase Price and the number of one one-hundredths of a
Preferred Share 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.
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 principal executive offices of the Company.
This Right Certificate, with or without other Right
Certificates, upon surrender at the principal office of the
Rights Agent, 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
Preferred Shares as the Rights evidenced by the Right Certificate
or Right Certificates surrendered shall have entitled such holder
to purchase. If this Right Certificate shall be exercised in
part, the holder shall be entitled to receive upon surrender
hereof another Right Certificate or Right Certificates for the
number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate may be redeemed by the
Company at a redemption price of $.01 per Right.
No fractional Preferred Shares will be issued upon the
exercise of any Right or Rights evidenced hereby (other than
fractions which are integral multiples of one one-hundredth of a
Preferred Share, which may, at the election of the Company, be
evidenced by depositary receipts), but in lieu thereof a cash
payment will be made, as provided in the Rights Agreement.
No holder of this Right Certificate, as such, shall be
entitled to vote or receive dividends or be deemed for any
purpose the holder of the Preferred Shares or
B-2
<PAGE>
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 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.
WITNESS the signature of the proper officers of the
Company and its corporate seal. Dated as of , 19 .
[SEAL]
ATTEST: SEEQ TECHNOLOGY INCORPORATED
By ______________________________
Countersigned:
AMERICAN STOCK
TRANSFER & TRUST COMPANY
as Rights Agent
By __________________
Authorized Officer
B-3
<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 Certificate.)
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: , 19
__________________________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a participant in a
Securities Transfer Association recognized signature program.
- -----------------------------------------------------------------
- -----------------------------------------------------------------
CERTIFICATION
The undersigned hereby certifies that the Rights
evidenced by this Right Certificate are not beneficially owned by
an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement).
__________________________________________
Signature
Form of Reverse Side of Right Certificate --
continued
B-4
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise the Right
Certificate.)
To SEEQ TECHNOLOGY INCORPORATED
The undersigned hereby irrevocably elects to exercise
_______________ Rights represented by this Right Certificate to
purchase the Preferred Shares issuable upon the exercise of such
Rights and requests that certificates for such Preferred Shares
be issued in the name of:
Please insert social security
or other identifying number
(Please print name and address)
If such number of Rights shall not be all the Rights evidenced by
this Right Certificate, a new Right Certificate for the balance
remaining of such Rights shall be registered in the name of and
delivered to:
Please insert social security
or other identifying number
(Please print name and address)
Dated: , 19
__________________________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a participant in a
Securities Transfer Association recognized signature program.
B-5
<PAGE>
Form of Reverse Side of Right Certificate -- continued
- -----------------------------------------------------------------
- ----------------------------------------------------------------
CERTIFICATION
The undersigned hereby certifies that the Rights
evidenced by this Right Certificate are not beneficially owned by
an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement).
__________________________________________
Signature
- -----------------------------------------------------------------
- -----------------------------------------------------------------
NOTICE
The signature in the foregoing Forms of Assignment and
Election to Purchase must conform to the name as written upon the
face of this Right Certificate in every particular, without
alteration or enlargement or any change whatsoever.
In the event the certification set forth above in the
Form of Assignment or the Form of Election to Purchase, as the
case may be, is not completed, the Company and the Rights Agent
will deem the beneficial owner of the Rights evidenced by this
Right Certificate to be an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.
B-6
<PAGE>
Exhibit C
SEEQ TECHNOLOGY INCORPORATED
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES
On April 21, 1995, the Board of Directors of SEEQ
Technology Incorporated (the "Company") declared a dividend of
one preferred share purchase right (a "Right") for each
outstanding share of Common Stock (the "Common Stock"), par value
$.01 per share (the "Common Shares"), of the Company. The
dividend is payable on May 2, 1995 (the "Record Date") to the
stockholders of record on that date. Each Right entitles the
registered holder to purchase from the Company one one-hundredth
of a share of Series A Junior Participating Preferred Stock, par
value $.01 per share (the "Preferred Shares"), of the Company at
a price of $15 per one one-hundredth of a Preferred Share (the
"Purchase Price"), subject to adjustment. The description and
terms of the Rights are set forth in a Rights Agreement dated as
of April 21, 1995 (the "Rights Agreement") between the Company
and American Stock Transfer & Trust Company, as Rights Agent (the
"Rights Agent").
Until the earlier to occur of (i) 10 days following a
public announcement that a person or group of affiliated or
associated persons (an "Acquiring Person") have acquired
beneficial ownership of 15% or more of the outstanding Common
Shares or (ii) 10 business days (or such later date as may be
determined by action of the Board of Directors prior to such time
as any Person becomes an Acquiring Person) following the
commencement of, or announcement of an intention to make, a
tender offer or exchange offer the consummation of which would
result in the beneficial ownership by a person or group of 15% or
more of such outstanding Common Shares (the earlier of such dates
being called the "Distribution Date"), the Rights will be
evidenced, with respect to any of the Common Share certificates
outstanding as of the Record Date, by such Common Share
certificate with a copy of this Summary of Rights attached
thereto.
The Rights Agreement provides that, until the
Distribution Date, the Rights will be transferred with and only
with the Common Shares. Until the Distribution Date (or earlier
redemption or expiration of the Rights), new Common Share
certificates issued after the Record Date, upon transfer or new
issuance of Common Shares 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 certificates for Common Shares,
outstanding as of the Record Date, even without such notation or
a copy
C-1
<PAGE>
of this Summary of Rights being attached thereto, will also
constitute the transfer of the Rights associated with the Common
Shares represented by such certificate. As soon as practicable
following the Distribution Date, separate certificates evidencing
the Rights ("Right Certificates") will be mailed to holders of
record of the Common Shares 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 May 2,
2005 (the "Final Expiration Date"), unless the Final Expiration
Date is extended or unless the Rights are earlier redeemed by the
Company, in each case as described below.
The Purchase Price payable, and the number of Preferred
Shares or other securities or property issuable, upon exercise of
the Rights are subject to adjustment from time to time to prevent
dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred
Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights or warrants to subscribe for or purchase Preferred
Shares at a price, or securities convertible into Preferred
Shares with a conversion price, less than the then current market
price of the Preferred Shares or (iii) upon the distribution to
holders of the Preferred Shares of evidences of indebtedness or
assets (excluding regular periodic cash dividends paid out of
earnings or retained earnings or dividends payable in Preferred
Shares) or of subscription rights or warrants (other than those
referred to above).
The number of outstanding Rights and the number of one
one-hundredths of a Preferred Share issuable upon exercise of
each Right are also subject to adjustment in the event of a stock
split of the Common Shares or a stock dividend on the Common
Shares payable in Common Shares or subdivisions, consolidations
or combinations of the Common Shares occurring, in any such case,
prior to the Distribution Date.
Preferred Shares purchasable upon exercise of the
Rights will not be redeemable. Each Preferred Share will be
entitled to an aggregate dividend of 100 times the dividend
declared per Common Share. In the event of liquidation, the
holders of the Preferred Shares will be entitled to an aggregate
payment of 100 times the payment made per Common Share. Each
Preferred Share will have 100 votes, voting together with the
Common Shares. Finally, in the event of any merger,
consolidation or other transaction in which Common Shares are
exchanged, each Preferred Share will be entitled to receive 100
times the amount received per Common Share. These rights are
protected by customary antidilution provisions.
C-2
<PAGE>
Because of the nature of the Preferred Shares'
dividend, liquidation and voting rights, the value of the one
one-hundredth interest in a Preferred Share purchasable upon
exercise of each Right should approximate the value of one Common
Share.
In the event that, after the Rights become exercisable,
the Company is acquired in a merger or other business combination
transaction with an Acquiring Person or an affiliate thereof, or
50% or more of its consolidated assets or earning power are sold
to an Acquiring Person or an affiliate thereof, proper provision
will be made so that each holder of a Right will thereafter have
the right to receive, upon exercise thereof at the then current
exercise price of the Right, that number of shares of common
stock of the acquiring company which at the time of such
transaction will have a market value of two times the exercise
price of the Right.
In the event that any person or group of affiliated or
associated persons becomes the beneficial owner of 15% or more of
the outstanding Common Shares (except pursuant to a tender offer
for all of the Common Shares at a price and on terms determined
by a majority of the Continuing Directors to be fair to and
otherwise n the best interests of the Company and its
stockholders) proper provision shall be made so that each holder
of a Right, other than Rights beneficially owned by the Acquiring
Person (which will thereafter be void), will thereafter have the
right to receive upon exercise that number of Common Shares (or
cash, other securities or property) having a market value of two
times the exercise price of the Right.
At any time after the acquisition by a person or group
of affiliated or associated persons of beneficial ownership of
15% or more of the outstanding Common Shares and prior to the
acquisition by such person or group of 50% or more of the
outstanding Common Shares, the Board of Directors of the Company
may exchange the Rights (other than Rights owned by such person
or group which have become void), in whole or in part, at an
exchange ratio of one Common Share (or a fraction of a Preferred
Share having equivalent market value) per Right (subject to
adjustment).
With certain exceptions, no adjustment in the Purchase
Price will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price. No fractional
Preferred Shares will be issued (other than fractions which are
integral multiples of one one-hundredth of a Preferred Share,
which may, at the election of the Company, be evidenced by
depositary receipts) and, in lieu thereof, an adjustment in cash
will be made based on the market price of the Preferred Shares on
the last trading day prior to the date of exercise.
At any time within ten (10) business days after a
person or group of affiliated or associated persons acquire
beneficial ownership of 15% or more of the outstanding Common
Shares (unless the Board of Directors extends such ten-day
period), the Board of
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Directors of the Company may redeem the Rights in whole, but not
in part, at a price of $.01 per Right (the "Redemption Price"),
upon the approval of a majority of the Continuing Directors. The
redemption of the rights may be made effective at such time on
such basis and with such conditions as the Board of Directors in
its sole discretion may establish. Immediately upon any
redemption of the Rights, the right to exercise the Rights will
terminate and the only right of the holders of Rights will be to
receive the Redemption Price. The Rights are also redeemable
under other circumstances as specified in the Rights Agreement.
The terms of the Rights may be amended by the Board of
Directors of the Company without the consent of the holders of
the Rights upon the approval of a majority of the Continuing
Directors, including an amendment to lower certain thresholds
described above to not less than the greater of (i) any
percentage greater than the largest percentage of the outstanding
Common Shares then known to the Company to be beneficially owned
by any person or group of affiliated or associated persons and
(ii) 15%, except that from and after a Distribution Date no such
amendment may adversely affect the interests of the holders of
the Rights.
Until a Right is exercised, the holder thereof, as
such, will have no rights as a stockholder of the Company,
including, without limitation, the right to vote or to receive
dividends.
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. 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.
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