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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
March 18, 1999
Date of Report (Date of earliest event reported)
SYSTEMS & COMPUTER TECHNOLOGY CORPORATION
(Exact name of issuer as specified in charter)
DELAWARE 0-11521 23-10701520
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(State or Other Jurisdiction Commission (I.R.S. Employer
of Incorporation or Organization) file number Identification Number)
Great Valley Corporate Center
Four Country View Road
Malvern, PA 19355
(Address of principal executive offices)
(610) 647-5930
(Registrant's telephone number, including area code)
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Item 5. Other Events
On March 18, 1999, the Board of Directors of Systems &
Computer Technology Corporation (the "Company") adopted a Stockholder Rights
Plan, providing that one Right shall be attached to each share of Common Stock
of the Company. The Rights will be distributed on April 16, 1999 to Shareholders
of record on April 9, 1999. Each Right entitles the registered holder to
purchase from the Company a unit (a "Unit") consisting of one one-hundredth of a
share of Series A Preferred Stock, with a par value of $.10 per share (the
"Preferred Stock"), at a purchase price of $100 per Unit (the "Purchase Price"),
subject to adjustment. The description and terms of the Rights are set forth in
the Rights Agreement (the "Rights Agreement"), dated as of April 13, 1999,
between the Company and ChaseMellon Shareholder Services L.L.C., as Rights Agent
(the "Rights Agent").
Initially, the Rights will be attached to all Common Stock
certificates representing shares then outstanding, and no separate Rights
Certificate will be distributed. The Rights will be separated from the common
stock only upon a Distribution Date, which will occur upon the earlier of (i) a
public announcement or other knowledge of the Company that a person or group of
affiliated or associated persons (an "Acquiring Person") has acquired, or
obtained the right to acquire, beneficial ownership of 15% or more of the
outstanding shares of Common Stock (the "Stock Acquisition Date") or (ii) the
close of business on a date designated by the Board of Directors following the
commencement of a tender or exchange offer that would result in a person or
group beneficially owning 15% or more of such outstanding shares of Common
Stock. Until the Distribution Date, (i) the Rights will be evidenced by the
Common Stock certificates and will be transferred with and only with such Common
Stock certificates, (ii) new Common Stock certificates will contain a notation
incorporating the Rights Agreement by reference and (iii) the surrender for
transfer of any certificates for Common Stock outstanding will also constitute
the transfer of the Rights associated with the Common Stock represented by such
certificate.
The Rights are not exercisable until the Distribution Date and
will expire at the close of business on April 13, 2009, unless earlier redeemed
by the Company as described below.
As soon as practicable after the Distribution Date, Rights
Certificates will be mailed to holders of record of the Common Stock as of the
close of business on the Distribution Date and, thereafter, the separate Rights
Certificates alone will represent the Rights. Except as otherwise determined by
the Board of Directors, only shares of Common Stock prior to the Distribution
Date will be issued with Rights.
In the event that an Acquiring Person becomes the beneficial
owner of 15% or more of the then outstanding shares of Common Stock, each holder
of a Right will thereafter have the right to receive, upon exercise, that number
of shares of Series A Preferred Stock (or, in certain circumstances, cash,
property or other securities of the Company), having a value equal to two times
the exercise price of the Right. The exercise price is the Purchase Price times
the number of shares of Common Stock associated with each Right (initially, one
to one).
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Notwithstanding any of the foregoing, following the occurrence of the event set
forth in this paragraph (the "Flip-In Event"), all Rights that are, or (under
certain circumstances specified in the Rights Agreement) were, beneficially
owned by any Acquiring Person will be null and void. However, Rights are not
exercisable following the occurrence of the Flip-In Event set forth above until
such time as the Rights are no longer redeemable by the Company as set forth
below.
In the event that following the Stock Acquisition Date, (i)
the Company is acquired in a merger or consolidation in which the Company is not
the surviving corporation or (ii) 50% or more of the Company's assets or earning
power is sold or transferred, each holder of a Right (except Rights which have
previously been voided as set forth above) shall thereafter have the right to
receive, upon exercise of the Right, Common Stock of the acquiring company
having a value equal to two times the exercise price of the Right.
Units of Preferred Shares which are purchasable under the Plan
will not be redeemable, and will be subordinate to any other shares of Preferred
Stock that may be issued by the Company. Each Preferred Share will be entitled
to an aggregate dividend of 100 times the dividend declared per Common Share,
but in no event shall such minimum preferential quarterly dividend payment be
less than $1.00 per 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, but in no event shall they receive less than
$1.00 per share plus accrued and unpaid dividends and distributions. 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 voting, dividend, and liquidation
rights of the Preferred Shares, the value of the one one-hundredth unit interest
in a Preferred Share purchasable upon exercise of each Right should approximate
the value of one Common Share.
The Purchase Price payable, and the number of Units of
Preferred Stock 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 Stock, or (ii) if holders of the Preferred
Stock are granted certain rights or warrants to subscribe for Preferred Stock or
evidences of indebtedness or assets (excluding regular quarterly cash dividends)
or of subscription rights or warrants (other than those referred to above).
No fractional Units of Preferred Stock will be issued and, in
lieu thereof, an adjustment in cash will be made based on the market price of
the Preferred Stock (or of the Common if there is no trading market for the
Preferred) on the last trading date prior to the date of exercise.
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At any time prior to 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 $.01 per Right (the "Redemption
Price"). 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, payable, at the election of a majority of the
Directors, in cash or in securities of the Company.
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. While the distribution of the Rights
will not be taxable to stockholders or to the Company, stockholders may,
depending upon the circumstances, recognize taxable income in the event that the
rights become exercisable for Preferred Stock (or other consideration) of the
Company as set forth above.
Other than those provisions relating to the principal economic
terms of the Rights, any of the provisions of the Rights Agreement may be
amended by the Board of Directors of the Company prior to the Distribution Date.
After the Distribution Date, the provisions of the Rights Agreement may be
amended by the Board in order to cure any ambiguity, or to make changes which do
not adversely affect the interests of holders of Rights (excluding the interest
of any Acquiring Person); provided that no amendment may reduce the Redemption
Price or provide for an earlier Expiration Date.
The summary description of the Rights set forth herein does
not purport to be complete and is qualified in its entirety by reference to the
Rights Agreement, which is filed as Exhibit 4.1 hereto.
Item 7. Exhibits.
Exhibit Description
4.1 Rights Agreement, dated as of April 13, 1999, between
Systems & Computer Technology Corporation and
ChaseMellon Shareholder Services L.L.C., including
Terms of Series A Participating Preferred Stock
(which is attached as Exhibit A to the Rights
Agreement) and Form of Right Certificate (which is
attached as Exhibit B to the Rights Agreement.
99 Press Release, dated March 22, 1999.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, Registrant has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.
Date: April 15, 1999 SYSTEMS & COMPUTER
TECHNOLOGY CORPORATION
By: /s/ Richard Blumenthal
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Richard Blumenthal, Esquire
Senior Vice President, General
Counsel and Secretary
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EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
4.1 Rights Agreement, dated as of April 13,
1999, between Systems & Computer Technology
Corporation and ChaseMellon Shareholder
Services L.L.C., including Terms of Series A
Participating Preferred Stock (which is
attached as Exhibit A) and Form of Right
Certificate (which is attached as Exhibit B
to the Rights Agreement).
99 Press Release, dated March 22, 1999.
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Exhibit 4.1
STOCKHOLDER RIGHTS AGREEMENT
Dated as of April 13, 1999
between
SYSTEMS & COMPUTER TECHNOLOGY CORPORATION
and
CHASEMELLON SHAREHOLDER SERVICES L.L.C.
as Rights Agent
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STOCKHOLDER RIGHTS AGREEMENT (the "Rights Agreement"), dated
as of April 13, 1999, between SYSTEMS & COMPUTER TECHNOLOGY CORPORATION, a
Delaware corporation (the "Company"), and ChaseMellon Shareholder Services,
L.L.C., as Rights Agent (the "Rights Agent").
The Board of Directors of the Company has authorized and
declared a dividend of one Right (as hereinafter defined) for each share of
Common Stock, par value $.01 per share, of the Company (the "Common Stock')
outstanding at the Close of Business (as hereinafter defined) on April 9, 1999
(the 'Record Date'), and has authorized the issuance of one Right on April 16,
1999 (the "Payment Date") (as such number may hereafter be adjusted pursuant to
the provisions of this Rights Agreement) with respect to each share of Common
Stock that shall become outstanding between the Record Date and the earliest of
the Distribution Date, the Redemption Date or the Expiration Date (as such terms
are hereinafter defined); provided, however, that Rights may be issued with
respect to shares of Common Stock that shall become outstanding after the
Distribution Date and prior to the earlier of the Redemption Date or the
Expiration Date in accordance with the provisions of Section 23. Each Right
shall initially represent the right to purchase one one-hundredths (1/100ths) of
a share of Series A Participating Preferred Stock, par value $.10 per share, of
the Company (the "Preferred Shares"), having the powers, rights and preferences
set forth in the Certificate of Designation attached hereto and made a part
hereof as Exhibit A.
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 Rights
Agreement, the following terms have the meanings indicated:
"Acquiring Person" shall mean any Person who or which, alone
or together with all Affiliates and Associates of such Person, shall be the
Beneficial Owner of 15% or more of the Common Shares then outstanding, but shall
not include (a) the Company, any Subsidiary of the Company, any employee benefit
plan of the Company or of any of its Subsidiaries, or any Person holding Common
Shares for or pursuant to the terms of any such employee benefit plan or (b) any
such Person who has become such a Beneficial Owner solely because (i) of a
change in the aggregate number of Common Shares outstanding since the last date
on which such Person acquired Beneficial Ownership of any Common Shares or (ii)
it acquired such Beneficial Ownership in the good faith belief that such
acquisition would not (x) cause such Beneficial Ownership to equal or exceed 15%
of the Common Shares then outstanding and such Person relied in good faith in
computing the percentage of its Beneficial Ownership on publicly filed reports
or documents of the Company which are inaccurate or out-of-date or (y) otherwise
cause a Distribution Date or the adjustment provided for in Section 11(a) to
occur. Notwithstanding clause (b) of the prior sentence, if any Person that is
not an Acquiring Person due to such clause (b) does not reduce its percentage of
Beneficial Ownership of Common Shares to less than 15% by the
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Close of Business on the fifth Business Day after notice from the Company (the
date of notice being the first day) that such Person's Beneficial Ownership of
Common Shares so equals or exceeds 15%, such Person shall, at the end of such
five Business Day period, become an Acquiring Person (and such clause (b) shall
no longer apply to such Person). For purposes of this definition, the
determination whether any Person acted in "good faith" shall be conclusively
determined by the Board of Directors of the Company, acting by a vote of those
directors of the Company as would be required to redeem the Rights under Section
24.
"Affiliate" and "Associate,' when used with reference to any
Person, shall have the respective meanings ascribed to such terms in Rule 12b-2
of the General Rules and Regulations under the Exchange Act, as in effect on the
date of this Rights Agreement.
A Person shall be deemed the "Beneficial Owner" of, and shall
be deemed to "beneficially own," and shall be deemed to have "Beneficial
Ownership" of, any securities:
(i) which such Person or any of such Person's Affiliates or
Associates is deemed to "beneficially own" within the meaning of Rule 13d-3 of
the General Rules and Regulations under the Exchange Act, as in effect on the
date of this Rights Agreement;
(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 (written or oral), or upon the exercise of
conversion rights, exchange rights, rights (other than the Rights), warrants or
options, or otherwise; provided, however, that a Person shall not be deemed the
Beneficial Owner of, or to beneficially own, or to have Beneficial Ownership of,
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 thereunder, or (B) the
right to vote pursuant to any agreement, arrangement or understanding (written
or oral) provided, however, that a Person shall not be deemed the 'Beneficial
Owner of, or to beneficially own, any security if (1) the agreement, arrangement
or understanding (written or oral) to vote such security 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 under the Exchange Act and (2) the beneficial ownership of
such security is not also then reportable on Schedule 13D under the Exchange Act
(or any comparable or successor report);
(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 (written or oral) for
the purpose of acquiring, holding, voting (except pursuant to a revocable proxy
as described in clause (ii) (B) of this definition) or disposing of any
securities of the Company.
Notwithstanding the foregoing, nothing contained in this definition shall cause
a Person ordinarily
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engaged in business as an underwriter of securities to be the "Beneficial Owner"
of, or to "beneficially own," any securities acquired in a bona fide firm
commitment underwriting pursuant to an underwriting agreement with the Company.
"Book Value," when used with reference to Common Shares issued
by any Person, shall mean the amount of equity of such Person applicable to each
Common Share, determined (i) in accordance with generally accepted accounting
principles in effect on the date as of which such Book Value is to be
determined, (ii) using all the consolidated assets and all the consolidated
liabilities of such Person on the date as of which such Book Value is to be
determined, except that no value shall be included in such assets for goodwill
arising from consummation of a business combination, and (iii) after giving
effect to (A) the exercise of all rights, options and warrants to purchase such
Common Shares (other than the Rights), and the conversion of all securities
convertible into such Common Shares, at an exercise or conversion price, per
Common Share, which is less than such Book Value before giving effect to such
exercise or conversion (whether or not exercisability or convertibility is
conditioned upon occurrence of a future event), (B) all dividends and other
distributions on the capital stock of such Person declared prior to the date as
of which such Book Value is to be determined and to be paid or made after such
date, and (C) any other agreement, arrangement or understanding (written or
oral), or transaction or other action prior to the date as of which such Book
Value is to be determined which would have the effect of thereafter reducing
such Book Value.
"Business Combination" shall have the meaning set forth in
Section 11(c)(I).
"Business Day" shall mean each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking institutions in the City
of New York, New York, are authorized or obligated by law or executive order to
close.
"Certificate of Designation" shall mean the Certificate of
Designation of Series A Participating Preferred Stock setting forth the powers,
preferences, rights, qualifications, limitations and restrictions of such series
of Preferred Stock of the Company, a copy of which is attached as Exhibit A.
"Close of Business" on any given date shall mean 5:00 p.m.,
New York City time, on such date; provided, however, that, if such date is not a
Business Day, "Close of Business" shall mean 5:00 p.m., New York City time, on
the next succeeding Business Day.
"Common Shares," when used with reference to the Company,
prior to a Business Combination, shall mean the shares of Common Stock of the
Company, or any other shares of capital stock of the Company into which the
Common Stock shall be reclassified or changed. "Common Shares," when used with
reference to any Person (other than the Company prior to a Business
Combination), shall mean shares of capital stock of such Person (if such Person
is a corporation) of any class or series, or units of equity interests in such
Person (if such Person is not a corporation) of any class or series, the terms
of which do not limit (as a maximum amount and
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not merely in proportional terms) the amount of dividends or income payable on
such class or series or the amount of assets on such class or series upon any
voluntary or involuntary liquidation, dissolution or winding up of such Person
and do not provide that such class or series is subject to redemption at the
option of such Person, or any shares of capital stock or units of equity
interests into which the foregoing shall be reclassified or changed; provided,
however, that, if at any time there shall be more than one such class or series
of capital stock or equity interests of such Person, "Common Shares"of such
Person shall include all such classes and series substantially in the proportion
of the total number of shares, or other units of each such class or series
outstanding at such time.
"Common Stock" shall have the meaning set forth in the
introductory paragraph of this Rights Agreement.
"Company" shall have the meaning set forth in the heading of
this Rights Agreement; provided, however, that if there is a Business
Combination, "Company" shall have the meaning set forth in Section 11(c)(III).
The term "control" with respect to any Person shall mean the
power to direct the management and policies of such Person, directly or
indirectly, by or through stock ownership, agency or otherwise, or pursuant to
or in connection with an agreement, arrangement or understanding (written or
oral) with one or more other Persons by or through stock ownership, agency or
otherwise, and the terms "controlling" and "controlled" shall have meanings
correlative to the foregoing.
"Distribution Date" shall have the meaning set forth in
Section 3(b).
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as in effect on the date in question, unless otherwise specifically provided.
"Exchange Consideration" shall have the meaning set forth in
Section 11(b)(I).
"Expiration Date" shall have the meaning set forth in Section
7(a).
"Major Part," when used with reference to the assets of the
Company and its Subsidiaries as of any date, shall mean assets (i) having a fair
market value aggregating 50% or more of the total fair market value of all the
assets of the Company and its Subsidiaries (taken as a whole) as of the date in
question, (ii) accounting for 50% or more of the total value (net of
depreciation and amortization) of all the assets of the Company and its
Subsidiaries (taken as a whole) as would be shown on a consolidated or combined
balance sheet of the Company and its Subsidiaries as of the date in question,
prepared in accordance with generally accepted accounting principles then in
effect, or (iii) accounting for 50% or more of the total amount of earnings
before interest, taxes, depreciation and amortization or revenues of the Company
and its Subsidiaries (taken as a whole) as would be shown on, or derived from, a
consolidated or combined statement
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of income of the Company and its Subsidiaries for the period of 12 months ending
on the last day of the Company's monthly accounting period next preceding the
date in question, prepared in accordance with generally accepted accounting
principles then in effect.
"Market Value," when used with reference to Common Shares on
any date, shall be deemed to be the average of the daily closing prices, per
share, of such Common Shares for the period which is the shorter of (1) 30
consecutive Trading Days immediately prior to the date in question or (2) the
number of consecutive Trading Days beginning on the Trading Day immediately
after the date of the first public announcement of the event requiring a
determination of the Market Value and ending on the Trading Day immediately
prior to the record date of such event; provided, however, that, in the event
that the Market Value of such Common Shares is to be determined in whole or in
part during a period following the announcement by the issuer of such Common
Shares of any action of the type described in Section 12(a) that would require
an adjustment thereunder, then, and in each such case, the Market Value of such
Common Shares shall be appropriately adjusted to reflect the effect of such
action on the market price of such Common Shares. The closing price for each
Trading Day shall be the closing price quoted on the composite tape for
securities listed on the principal United States securities exchange registered
under the Exchange Act (or any recognized foreign stock exchange) on which such
securities are listed, or, if such securities are not listed on any such
exchange, the average of the closing bid and asked quotations with respect to a
share of such securities on the National Association of Securities Dealers, Inc.
Automated Quotations System or such other system then in use, or, if no such
quotations are available, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in such securities
selected by the Board of Directors of the Company. If on any such Trading Day no
market maker is making a market in such securities, the closing price of such
securities on such Trading Day shall be deemed to be the fair value of such
securities as determined in good faith by the Board of Directors of the Company
(whose determination shall be described in a statement filed with the Rights
Agent and shall be binding on the Rights Agent, the holders of Rights and all
other Persons); provided, however, that, for the purpose of determining the
closing price of the Preferred Shares for any Trading Day on which there is no
such market maker for the Preferred Shares the closing price on such Trading Day
shall be deemed to be the Formula Number (as defined in the Certificate of
Designation) times the closing price of the Common Shares of the Company on such
Trading Day.
"Payment Date" shall have the meaning set forth in the
introductory paragraph of this Rights Agreement.
"Person" shall mean an individual, corporation, partnership,
joint venture, association, trust, unincorporated organization or other entity.
"Preferred Shares" shall have the meaning set forth in the
introductory paragraph of this Rights Agreement. Any reference in this Rights
Agreement to Preferred Shares shall be deemed to include any authorized fraction
of a Preferred Share, unless the context otherwise requires.
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"Principal Party" shall mean the Surviving Person in a
Business Combination; provided, however, that, if such Surviving Person is a
direct or indirect Subsidiary of any other Person, "Principal Party" shall mean
the Person which is the ultimate parent of such Surviving Person and which is
not itself a Subsidiary of another Person. In the event ultimate control of such
Surviving Person is shared by two or more Persons, "Principal Party" shall mean
that Person that is immediately controlled by such two or more Persons.
"Purchase Price" with respect to each Right shall mean $100,
as such amount may from time to time be adjusted as provided herein, and shall
be payable in lawful money of the United States of America. All references
herein to the Purchase Price shall mean the Purchase Price as in effect at the
time in question.
"Record Date" shall have the meaning set forth in the
introductory paragraph of this Rights Agreement.
"Redemption Date" shall have the meaning set forth in Section
24(a).
"Redemption Price" with respect to each Right shall mean $.01,
as such amount may from time to time be adjusted in accordance with Section 12.
All references herein to the Redemption Price shall mean the Redemption Price as
in effect at the time in question.
"Registered Common Shares" shall mean Common Shares which are,
as of the date of consummation of a Business Combination, and have continuously
been for the 12 months immediately preceding such date, registered under Section
12 of the Exchange Act.
"Right Certificate" shall mean a certificate evidencing a
Right in substantially the form attached hereto and made a part hereof as
Exhibit B.
"Rights" shall mean the rights to purchase Preferred Shares
(or other securities) as provided in this Rights Agreement.
"Securities Act" shall mean the Securities Act of 1933, as in
effect on the date in question, unless otherwise specifically provided.
"Subsidiary" shall mean a Person, at least a majority of the
total outstanding voting power (being the power under ordinary circumstances
(and not merely upon the happening of a contingency) to vote in the election of
directors of such Person (if such Person is a corporation) or to participate in
the management and control of such Person (if such Person is not a corporation)
which is owned, directly or indirectly, by another Person or by one or more
other Subsidiaries of such other Person or by such other Person and one or more
other Subsidiaries of such other Person.
"Surviving Person" shall mean (1) the Person which is the
continuing or surviving Person in a consolidation or merger specified in Section
11(c)(I)(i) or 11(c)(I)(ii) or (2) the Person
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to which the Major Part of the assets of the Company and its Subsidiaries is
sold, leased, exchanged or otherwise transferred or disposed of in a transaction
specified in Section 11(c)(I)(iii); provided, however, that, if the Major Part
of the assets of the Company and its Subsidiaries is sold, leased, exchanged or
otherwise transferred or disposed of in one or more related transactions
specified in Section 11(c)(I)(iii) to more than one Person, the "Surviving
Person" in such case shall mean the Person that acquired assets of the Company
and/or its Subsidiaries with the greatest fair market value in such transaction
or transactions.
"Trading Day" shall mean a day on which the principal national
securities exchange (or principal recognized foreign stock exchange, as the case
may be) on which any Common Shares, Preferred Shares or Rights, as the case may
be, are listed or admitted to trading is open for the transaction of business
or, if the Common Shares, Preferred Shares or Rights in question are not listed
or admitted to trading on any national securities exchange (or recognized
foreign stock exchange, as the case may be), on a Business Day.
SECTION 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company in accordance with the
term and conditions hereof, and the Rights Agent hereby accepts such
appointment. The Company may from time to time appoint one or more co-Rights
Agents as it may deem necessary or desirable (the term "Rights Agent" being used
herein to refer, collectively, to the Rights Agent together with any such co-
Rights Agents). In the event the Company ,appoints one or more Rights Agents,
the respective duties of the Rights Agent and any co-Rights Agents shall be as
the Company shall determine. The Rights Agent shall have no duty to supervise,
and in no event shall be liable for, the acts or omissions of any such co-Rights
Agent.
SECTION 3. Issue of Rights and Right Certificates. (a)
Effective on or after the Payment Date, one Right shall be associated with each
Common Share outstanding on the Record Date, each additional Common Share that
shall become outstanding between the Record Date and the earliest of the
Distribution Date, the Redemption Date or the Expiration Date and each
additional Common Share with which Rights are issued after the Distribution Date
but prior to the earlier of the Redemption Date or the Expiration Date as
provided in Section 23; provided, however, that, if the number of outstanding
Rights are combined into a smaller number of outstanding Rights pursuant to
Section 12(a), the appropriate fractional Right determined pursuant to such
Section shall thereafter be associated with each such Common Share.
(b) Until the earlier of (i) such time as the Company
learns that a Person has become an Acquiring Person or (ii) the Close of
Business on such date, if any, as may be designated by the Board of Directors of
the Company following the commencement of, or first public disclosure of an
intent to commence, a tender or exchange offer by any Person (other than the
Company, any Subsidiary of the Company, any employee benefit plan of the Company
or of any of its Subsidiaries, or any Person holding Common Shares for or
pursuant to the terms of any such employee benefit plan) for outstanding Common
Shares, if upon consummation of such tender or exchange offer such Person could
be the Beneficial Owner of 15% or more of the
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outstanding Common Shares (the Close of Business on the earlier of such dates
being the "Distribution Date"), (x) the Rights will be evidenced by the
certificates for Common Shares registered in the names of the holders thereof
and not by separate Right Certificates and (y) the Rights, including 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 send, by first-class, postage-prepaid mail, to each record
holder of Common Shares as of the Distribution Date, at the address of such
holder shown on the records of the Company, a Right Certificate evidencing one
whole Right for each Common Share (or for the number of Common Shares with which
one whole Right is then associated if the number of Rights per Common Share held
by such record holder has been adjusted in accordance with the provision in
Section 3(a)). If the number of Rights associated with each Common Share has
been adjusted in accordance with the provision in Section 3(a), at the time of
distribution of the Right Certificates the Company may make any necessary and
appropriate rounding adjustments so that Right Certificates representing only
whole numbers of Rights are distributed and cash is paid in lieu of any
fractional Right in accordance with Section 15(a). As of and after the
Distribution Date, the Rights will be evidenced solely by such Right
Certificates.
(c) With respect to any certificate for Common
Shares, until the earliest of the Distribution Date, the Redemption Date or the
Expiration Date, the Rights associated with the Common Shares represented by any
such certificate shall be evidenced by such certificate alone, the registered
holders of the Common Shares shall also be the registered holders of the
associated Rights and the surrender for transfer of any such certificate shall
also constitute the transfer of the Rights associated with the Common Shares
represented thereby.
(d) Certificates issued for Common Shares after the
Record Date (including, without limitation, upon transfer or exchange of
outstanding Common Shares), but prior to the earliest of the Distribution Date,
the Redemption Date or the Expiration Date, may have 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 Stockholder Rights Agreement dated as
of April 13, 1999, as it may be amended from time to time (the "Rights
Agreement"), between Systems & Computer Technology Corporation (the "Company")
and ChaseMellon Shareholder Services L.L.P. as Rights Agent (the "Rights
Agent"), the terms of which are hereby incorporated herein by reference and a
copy of which is on file at the principal executive offices of the Company.
Under certain circumstances, as set forth in the Rights Agreement, such Rights
will be evidenced by separate certificates and will no longer be evidenced by
this certificate. The Company will mail to the holder of this certificate a copy
of the Rights Agreement without charge after receipt of a written request
therefor. Rights beneficially owned by Acquiring Persons or their Affiliates or
Associates (as such terms are defined in the Rights Agreement) and by any
subsequent holder of such Rights are null and void and nontransferable."
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Notwithstanding this paragraph (d), the omission of a legend shall not affect
the enforceability of any part of this Rights Agreement or the rights of any
holder of Rights.
SECTION 4. Form of Right Certificates. The Right Certificates
(and the form of election to purchase and form of assignment to be printed on
the reverse side thereof), shall be in substantially the form set forth as
Exhibit B and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem
appropriate which do not affect the duties or responsibilities of the Rights
Agent and as are not inconsistent with the provisions of this Rights Agreement,
or as may be required to comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock
exchange on which the Rights may from time to time be listed, or to conform to
usage. Subject to the provisions of Sections 7, 11 and 23, the Right
Certificates, whenever issued, shall be dated as of the Distribution Date, and
on their face shall entitle the holders thereof to purchase such number of
Preferred Shares as shall be set forth therein for the Purchase Price set forth
therein, subject to adjustment from time to time as herein provided.
SECTION 5. Execution, Countersignature and Registration. (a)
The Right Certificates shall be executed on behalf of the Company by the
Chairman of the Board, the Chief Executive Officer, the President, the Chief
Operating Officer, the Treasurer or a Vice President (whether preceded by any
additional title) of the Company, either manually or by facsimile signature, and
have affixed thereto the Company's seal or a facsimile thereof which shall be
attested by the Secretary, an Assistant Secretary or a Vice President (whether
preceded by any additional title, provided that such Vice President shall not
have also executed the Right Certificates) 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 or obligatory for any purpose unless so
countersigned. In case an officer of the Company who shall have signed any of
the Right Certificates shall cease to be such an officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Right Certificates may nevertheless 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 an
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 execution of such Right
Certificate, shall be a proper officer of the Company to sign such Right
Certificate, although at the date of execution of this Rights Agreement any such
person was not such an officer of the Company.
(b) Following the Distribution Date and receipt by
the Rights Agent of all necessary information, the Rights Agent will keep or
cause to be kept, at an office or agency 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 by each of the Right Certificates,
the certificate number of each of the Right Certificates and the date of each of
the Right Certificates.
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SECTION 6. Transfer, Split-up, Combination and Exchange of
Right Certificates: Mutilated, Destroyed, Lost or Stolen Right Certificates;
Uncertificated Rights.
(a) Subject to the provisions of Sections 7(e) and
15, at any time after the Distribution Date, and at or prior to the Close of
Business on the earlier of the Redemption Date or the Expiration Date, any Right
Certificate or Right Certificates may be transferred, split-up, combined or
exchanged for another Right Certificate or Right Certificates representing, in
the aggregate, the same number of Rights as the Right Certificate or Right
Certificates surrendered then represented. Any registered holder desiring to
transfer, split-up, combine or exchange any Right Certificate shall make such
request in writing delivered to the Rights Agent and shall surrender the Right
Certificate or Right Certificates to be transferred, split-up, combined or
exchanged at an office or agency of the Rights Agent designated for such
purpose; provided, however, that neither the Rights Agent nor the Company shall
be obligated to take any action with respect to the transfer of any Right
Certificate surrendered for transfer until the registered holder shall have
completed and signed the certification contained in the form of assignment on
the reverse side of much Right Certificate and shall have 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. Thereupon the Rights Agent shall, subject to Sections 7(e)
and 15, 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 charge that
may be imposed in connection with any transfer, split-up, combination or
exchange of Right Certificates. The Rights Agent shall have no duty or
obligation under this Section unless and until it is satisfied that all such
taxes and/or charges have been paid.
(b) Upon receipt by the Company and the Rights Agent
of evidence reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a valid Right Certificate, and, in case of loss, theft or
destruction of indemnity or security 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 a new
Right Certificate of like tenor and deliver such new Right Certificate to the
Rights Agent for delivery to the registered owner in lieu of the Right
Certificate so lost, stolen, destroyed or mutilated.
(c) Notwithstanding any other provision hereof, the
Company and the Rights Agent may amend this Rights Agreement to provide for
uncertificated Rights in addition to or in place of Rights evidenced by Right
Certificates.
SECTION 7. Exercise of Rights; Expiration Date of Rights.
(a) Subject to Section 7(e) and except as otherwise
provided herein (including Section 11), each Right shall entitle the registered
holder thereof, upon exercise thereof as provided herein, to purchase for the
Purchase Price, at any time after the Distribution Date and at or prior to the
earlier of (i) the Close of Business on the 10th anniversary of the date of this
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Rights Agreement (the Close of Business on such date being the "Expiration
Date'), or (ii) the Redemption Date, one one-hundredths (1/100ths) of a
Preferred Share, subject to adjustment from time to time as provided in sections
11 and 12.
(b) 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 on the reverse side
thereof duly and properly 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-hundredths (1/100ths) of a Preferred Share as to which
the Rights are exercised, at or prior to the earlier of (i) the Expiration Date
or (ii) the Redemption Date.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase duly and properly
executed, accompanied by payment of the Purchase Price for the Preferred Shares
to be purchased together with an amount equal to any applicable tax or charge,
in lawful money of the United States of America, in cash or by certified check
or money order payable to the order of the Company, the Rights Agent shall
thereupon (i) either (A) promptly requisition from any transfer agent of the
Preferred Shares (or make available, if the Rights Agent is the transfer agent)
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) if the Company shall have elected to deposit the Preferred
Shares with a depositary agent under a depositary arrangement, promptly
requisition from the depositary agent depositary receipts representing the
number of one one-hundredths (1/100ths) of a Preferred Share to be purchased (in
which case certificates for the Preferred Shares to be represented by such
receipts shall be deposited by the transfer agent with the depositary agent) and
the Company will direct the depositary agent to comply with all such requests,
(ii) when appropriate, promptly requisition from the Company the amount of cash
to be paid in lieu of issuance of fractional shares in accordance with Section
15, (iii) promptly after receipt of such certificates or depositary receipts,
cause the same to be delivered to or upon the order of the registered holder of
such Right Certificate, registered in such name or names as may be designated by
such holder and (iv) when appropriate, after receipt promptly 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 fewer 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 and delivered to the registered
holder of such Right Certificate or to his duly authorized assigns, subject to
the provisions of Section 15.
(e) Notwithstanding anything in this Rights Agreement
to the contrary, any Rights that are at any time beneficially owned by an
Acquiring Person or any Affiliate or Associate of an Acquiring Person shall be
null and void and nontransferable, and any holder of any such Right (including
any purported transferee or subsequent holder) shall not have any right to
exercise or transfer any such Right.
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(f) Notwithstanding anything in this Rights Agreement
to the contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder of any Right
Certificates 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 or
the Rights Agent shall reasonably request.
(g) The Company may temporarily suspend, for a period
of time not to exceed 90 calendar days after the Distribution Date, the
exercisability of the Rights in order to prepare and file a registration
statement under the Securities Act, on an Appropriate form, with respect to the
Preferred Shares purchasable upon exercise of the Rights and permit such
registration statement to become effective; provided, however, that no such
suspension shall remain effective after, and the Rights shall without any
further action by the Company or any other Person become exercisable immediately
upon, the effectiveness of such registration statement. Upon any such
suspension, the Company shall issue a public announcement with prompt notice
thereof to the Rights Agent stating that the exercisability of the Rights has
been temporarily suspended and shall issue a further public announcement with
prompt notice thereof to the Rights Agent at such time as the suspension is no
longer in effect. Notwithstanding any provision herein to the contrary, the
Rights shall not be exercisable in any jurisdiction if the requisite
qualification under the Blue Sky or securities laws of such jurisdiction shall
not have been obtained or the exercise of the Rights shall not be permitted
under applicable law.
SECTION 8. Cancellation and Destruction of Right Certificates.
All Right Certificates surrendered or presented to the Rights Agent for the
purpose of exercise, transfer, split-up, combination or exchange, and any Right
Certificate representing Rights that have become null and void and
nontransferable pursuant to Section 7(e) surrendered or presented if surrendered
or presented to the Company or to any of its agents, for any purpose, shall be
canceled by it, and no Right Certificates shall be issued in lieu thereof except
as expressly permitted by 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 Right Certificates purchased or acquired by the Company.
The Rights Agent shall deliver all canceled Right Certificates to the Company,
or shall, at the written request of the Company, destroy such canceled Right
Certificates, and in such case shall deliver a certificate of destruction
thereof to the Company.
SECTION 9. Reservation and Availability of Preferred Shares.
(a) 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 authorized and issued Preferred Shares held in its
treasury, free from preemptive rights or any right of first refusal, a
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number of Preferred Shares sufficient to permit the exercise in full of all
outstanding Rights.
(b) In the event that there shall not be sufficient
Preferred Shares issued but not outstanding or authorized but unissued to permit
the exercise or exchange of Rights in accordance with Section 11, the Company
covenants and agrees that it will take all such action as may be necessary to
authorize additional Preferred Shares for issuance upon the exercise or exchange
of Rights pursuant to Section 11; provided, however, that if the Company is
unable to cause the authorization of additional Preferred Shares, then the
Company shall, or in lieu of seeking any such authorization, the Company may, to
the extent necessary and permitted by applicable law and any agreements or
instruments in effect prior to the Distribution Date to which it is a party, (A)
upon surrender of a Right, pay cash equal to the Purchase Price in lieu of
issuing Preferred Shares and requiring payment therefor, (B) upon due exercise
of a Right and payment of the Purchase Price for each Preferred Share as to
which such Right is exercised, issue equity securities having a value equal to
the value of the Preferred Shares which otherwise would have been issuable
pursuant to Section 11, which value shall be determined by a nationally
recognized investment banking firm selected by the Board of Directors of the
Company or (C) upon due exercise of a Right and payment of the Purchase Price
for each Preferred Share as to which such Right is exercised, distribute a
combination of Preferred Shares, cash and/or other equity and/or debt securities
having an aggregate value equal to the value of the Preferred Shares which
otherwise would have been issuable pursuant to Section 11, which value shall be
determined by a nationally recognized investment banking firm selected by the
Board. To the extent that any legal or contractual restrictions (pursuant to
agreements or, instruments in effect prior to the Distribution Date to which it
is party) prevent the Company from paying the full amount payable in accordance
with the foregoing sentence, the Company shall pay to holders of the Rights as
to which such payments are being made all amounts which are not then restricted
on a pro rata basis as such payments become permissible under such legal or
contractual restrictions until such payments have been paid in full.
(c) 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 or exchange 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.
(d) So long as the Preferred Shares issuable upon the
exercise or exchange of Rights are to be listed on any national securities
exchange, the Company covenants and agrees to use its best efforts to cause,
from and after such time as the Rights become exercisable or exchangeable, all
Preferred Shares reserved for such issuance to be listed on such securities
exchange upon official notice of issuance upon such exercise or exchange.
(e) The Company further covenants and agrees that it
will pay when due and payable any and all taxes and charges which may be payable
in respect of the issuance or delivery of Right Certificates or of any Preferred
Shares or Common Shares or other securities upon the exercise or exchange of the
Rights. The Company shall not, however, be required to pay
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any tax or charge which may be payable in respect of any transfer or delivery of
Right Certificates to a Person other than, or in respect of the issuance or
delivery of certificates for the Preferred Shares or Common Shares or other
securities, as the case may be, in a name other than that of the registered
holder of the Right Certificate evidencing Rights surrendered for exercise or
exchange, or to issue or deliver any certificates for Preferred Shares or Common
Shares or other securities, as the case may be, upon the exercise or exchange of
any Rights until any such tax or charge shall have been paid (any such tax or
charge being payable by the holder of such Right Certificate at the time of
surrender) or until it has been established to the Company's satisfaction that
no such tax or charge is due.
SECTION 10. Preferred Shares Record Date. Each Person in whose
name any certificate for Preferred Shares or Common Shares or other securities
is issued upon the exercise or exchange of Rights shall for all purposes be
deemed to have become the holder of record of the Preferred Shares or Common
Shares or other securities, as the case may be, represented thereby on, and such
certificate shall be dated the date upon which the Right Certificate evidencing
such Rights was duly surrendered and payment of any Purchase Price (and any
applicable tax or charge) was made; provided, however, that, if the date of such
surrender and payment is a date upon which the transfer books of the Company for
the Preferred Shares or Common Shares or other securities, as the case may be,
are closed, such Person shall be deemed to have become the record holder of such
Preferred Shares or Common Shares or other securities, as the case may be, on,
and such certificate shall be dated, the next succeeding Business Day on which
the transfer books of the Company for the Preferred Shares or Common Shares or
other securities, as the case may be, are open.
SECTION 11. Adjustments in Rights After There Is an Acquiring
Person; Exchange of Rights for Shares; Business Combinations.
(a) Upon a Person becoming an Acquiring Person,
proper provision shall be made so that each holder of a Right, except as
provided in Section 7(e), shall thereafter have a right to receive, upon
exercise thereof for the Purchase Price in accordance with the terms of this
Rights Agreement, such number of one one-hundredths (1/100ths) of a Preferred
Share as shall equal the result obtained by multiplying the Purchase Price by a
fraction, the numerator of which is the number of one one-hundredths (1/100ths)
of a Preferred Share for which a Right is then exercisable and the denominator
of which is 50% of the market value of the Common Shares on the date on which a
Person becomes an Acquiring Person. As soon as practicable after a Person
becomes an Acquiring Person (provided the Company shall not have elected to make
the exchange permitted by Section 11(b)(I) for all outstanding Rights), the
Company covenants and agrees to use its best efforts to:
(I) prepare and file a registration statement under
the Securities Act, on an appropriate form, with respect to
the Preferred Shares purchasable upon exercise of the Rights;
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(II) cause such registration statement to become
effective as soon as practicable after such filing;
(III) cause such registration statement to remain
effective (with a prospectus at all times meeting the
requirements of the Securities Act) until the Expiration Date;
and
(IV) qualify or register the Preferred Shares
purchasable upon exercise of the Rights under the Blue Sky or
securities laws of such jurisdictions as may be necessary or
appropriate.
(b) (I) The Board of Directors of the Company may, at
its option, at any time after a Person becomes an Acquiring Person, mandatorily
exchange all or part of the then outstanding and exercisable Rights (which shall
not include Rights that shall have become null and void and nontransferable
pursuant to the provisions of Section 7(e)) for consideration per Right
consisting of one-half of the securities that would be issuable at such time
upon the exercise of one Right in accordance with Section 11(a) or, if
applicable, Section 9(b) (the consideration issuable per Right pursuant to this
Section 11(b)(I) being the "Exchange Consideration"). The Board of Directors of
the Company may, at its option, issue, in substitution for Preferred Shares,
Common Shares in an amount per Preferred Share equal to the Formula Number (as
defined in the Certificate of Designation) if there are sufficient Common Shares
issued but not outstanding or authorized but unissued. If the Board of Directors
of the Company elects to exchange all the Rights for Exchange Consideration
pursuant to this Section II(b)(1) prior to the physical distribution of the
Right Certificates, the Corporation may distribute the Exchange Consideration in
lieu of distributing Right Certificates, in which case for purposes of this
Rights Agreement holders of Rights shall be deemed to have simultaneously
received and surrendered for exchange Right Certificates on the date of such
distribution.
(II) Any action of the Board of Directors of the
Company ordering the exchange of any Rights pursuant to Section 11(b)(I) shall
be irrevocable and, immediately upon the taking of such action and without any
further action and without any notice, the right to exercise any such Right
pursuant to Section 11(a) shall terminate and the only right thereafter of a
holder of such Right shall be to receive the Exchange Consideration in exchange
for each such Right held by such holder or, if the Exchange Consideration shall
not have been paid or issued, to exercise any such Right pursuant to Section
11(c)(I). 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 holders of such Rights at their last
addresses as they appear upon the registry books of the Rights Agent and give
prompt notice thereof to 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 Rights for the Exchange Consideration shall be effected and, in
the event of any partial exchange, the number of Rights which will be exchanged.
Any exchange shall be effected
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pro rata based on the number of Rights (other than Rights which shall have
become null and void and nontransferable pursuant to the provisions of Section
7(e)) held by each holder of Rights.
(c) (I) In the event that, following a Distribution
Date, directly or indirectly, any transactions specified in the following clause
(i), (ii) or (iii) of this Section 11(I)(c) (each such transaction being a
"Business Combination") shall be consummated:
(i) the Company shall consolidate with, or
merge with and into, any Acquiring Person or any Affiliate or Associate of an
Acquiring Person;
(ii) any Acquiring Person or any Affiliate or
Associate of an Acquiring Person shall merge with and into the Company and, in
connection with such merger, all or part of the Common Shares shall be changed
into or exchanged for capital stock or other securities of the Company or of any
Acquiring Person or Affiliate or Associate of an Acquiring Person or cash or any
other property; or
(iii) the Company shall sell, lease, exchange
or otherwise transfer or dispose of (or one or more of its Subsidiaries shall
sell, lease, exchange or otherwise transfer or dispose of), in one or more
transactions, the Major Part of the assets of the Company and its Subsidiaries
(taken as a whole) to any Acquiring Person or any Affiliate or Associate of an
Acquiring Person, then, in each such case, proper provision shall be made so
that each holder of a Right, except as provided in Section 7(e), shall
thereafter have the right to receive, upon the exercise thereof for the Purchase
Price in accordance with the terms of this Rights Agreement, the securities
specified below (or, at such holder's option, the securities specified in
Section 11(a)):
(A) If the Principal Party in such Business
Combination has Registered Common Shares outstanding, each
Right shall thereafter represent the right to receive, upon
the exercise thereof for the Purchase Price in accordance with
the terms of this Rights Agreement, such number of Registered
Common Shares of such Principal Party, free and clear of all
liens, encumbrances or other adverse claims, as shall have an
aggregate Market Value equal to the result obtained by
multiplying the Purchase Price by two;
(B) If the Principal Party involved in such Business
Combination does not have Registered Common Shares
outstanding, each Right shall thereafter represent the right
to receive, upon the exercise thereof for the Purchase Price
in accordance with the terms of this Rights Agreement, at the
election of the holder of such Right at the time of the
exercise thereof, any of:
(1) such number of Common Shares of the
Surviving Person in such Business Combination as shall have an
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aggregate Book Value immediately after giving effect to such
Business Combination equal to the result obtained by
multiplying the Purchase Price by two;
(2) such number of Common Shares of the
Principal Party in such Business Combination (if the Principal
Party is not also the Surviving Person in such Business
Combination) as shall have an aggregate Book Value immediately
after giving effect to such Business Combination equal to the
result obtained by multiplying the Purchase Price by two; or
(3) if the Principal Party in such Business
Combination is an Affiliate of one or more Persons which has
Registered Common Shares outstanding, such number of
Registered Common Shares of whichever of such Affiliates of
the Principal Party has Registered Common Shares with the
greatest aggregate Market Value on the date of consummation of
such Business Combination and shall have an aggregate Market
Value on the date of such Business Combination equal to the
result obtained by multiplying the Purchase Price by two.
(II) The Company shall not consummate any Business Combination unless
each issuer of Common Shares for which Rights may be exercised, as set forth in
this Section 11(c), shall have sufficient authorized Common Shares that have not
been issued or reserved for issuance (and which shall, when issued upon exercise
thereof in accordance with this Rights Agreement, be validly issued, fully paid
and nonassessable and free of preemptive rights, rights of first refusal or any
other restrictions or limitations on the transfer or ownership thereof) to
permit the exercise in full of the Rights in accordance with this Section 11(c)
and unless prior thereto:
(i) a registration statement under the
Securities Act on an appropriate form, with respect to the Rights and the Common
Shares of such issuer purchasable upon exercise of the Rights, shall be
effective under the Securities Act; and
(ii) the Company and each such issuer shall
have:
(A) executed and delivered to the Rights Agent a
supplemental agreement providing for the assumption by such
issuer of the obligations set forth in this Section 11(c)
(including the obligation of such issuer to issue Common
Shares upon the exercise of Rights in accordance with the
terms set forth in Sections 11(c)(I) and 11(c)(III) and
further providing that such issuer, at its own expense, will
use its best efforts to:
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(1) cause a registration statement under the
Securities Act on an appropriate form, with respect to the
Rights and the Common Shares of such issuer purchasable upon
exercise of the Rights, to remain effective (with a prospectus
at all times meeting the requirements of the Securities Act)
until the Expiration Date;
(2) qualify or register the Rights and the
Common Shares of such issuer purchasable upon exercise of the
Rights under the Blue Sky or securities laws of such
jurisdictions as may be necessary or appropriate; and
(3) list the Rights and the Common Shares of
such issuer purchasable upon exercise of the Rights on each
national securities exchange on which the Common Shares were
listed prior to the consummation of the Business Combination
or, if the Common Shares were not listed on a national
securities exchange prior to the consummation of the Business
Combination, on a national securities exchange;
(B) furnished to the Rights Agent a written opinion
of independent counsel stating that such supplemental
agreement is a valid, binding and enforceable agreement of
such issuer; and
(C) filed with the Rights Agent a certificate of a
nationally recognized firm of independent accountants setting
forth the number of Common Shares of such issuer which may be
purchased upon the exercise of each Right after the
consummation of such Business Combination.
(III) After consummation of any Business Combination and
subject to the provisions of Section 11(c)(II), (i) each issuer of Common Shares
for which Rights may be exercised as set forth in this Section 11(c) shall be
liable for, and shall assume, by virtue of such Business Combination, all the
obligations and duties of the Company pursuant to this Rights Agreement, (ii)
the term "Company" shall thereafter be deemed to refer to such issuer, (iii)
each such issuer shall take such steps in connection with such consummation as
may be necessary to assure that the provisions hereof (including the provisions
of Sections 11(a) and 11(c)) shall thereafter be applicable, as nearly as
reasonably may be, in relation to its Common Shares thereafter deliverable upon
the exercise of the Rights, and (iv) the number of Common Shares of each such
issuer thereafter 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 of Sections 11 and 12 and the provisions of
Section 7, 9 and 10 with respect to the Preferred Shares shall apply, as nearly
as reasonably may be, on like terms to any such Common Shares.
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SECTION 12. Certain Adjustments.
(a) To preserve the actual or potential economic
value of the Rights, if at any time after the date of this Rights Agreement
there shall be any change in the Common Shares or the Preferred Shares, whether
by reason of stock dividends, stock splits, recapitalizations, mergers,
consolidations, combinations or exchanges of securities, split-ups, split-offs,
spin-offs, liquidations, other similar changes in capitalization, any
distribution or issuance of cash, assets, evidences of indebtedness or
subscription rights, options or warrants to holders of Common Shares or
Preferred Shares, as the case may be (other than distribution of the Rights or
regular quarterly cash dividends) or otherwise, then, in each such event the
Board of Directors of the Company shall make such appropriate adjustments in the
number of Preferred Shares (or the number and kind of other securities) issuable
upon exercise of each Right, the Purchase Price and Redemption Price in effect
at such time and the number of Rights outstanding at such time (including the
number of Rights or fractional Rights associated with each Common Share) such
that following such adjustment such event shall not have had the effect of
reducing or limiting the benefits the holders of the Rights would have had
absent such event.
(b) If, as a result of an adjustment made pursuant to
Section 12(a), the holder of any Right thereafter exercised shall become
entitled to receive any securities other than Preferred Shares, thereafter the
number of such securities 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 of Sections 11 and 12 and the
provisions of Sections 7, 9 and 10 with respect to the Preferred Shares shall
apply, as nearly as reasonably may be, on like terms to any such other
securities.
(c) All Rights originally issued by the Company
subsequent to any adjustment made to the amount of Preferred Shares or other
securities relating to a Right shall evidence the right to purchase, for the
Purchase Price, the adjusted number and kind of securities purchasable from time
to time hereunder upon exercise of the Rights, all subject to further adjustment
as provided herein.
(d) Irrespective of any adjustment or change in the
Purchase Price or the number of Preferred Shares or number or kind of other
securities issuable upon the exercise of the Rights, the Right Certificates
theretofore and thereafter issued may continue to express the terms which were
expressed in the initial Right Certificates issued hereunder.
(e) In any case in which action taken pursuant to
Section 12(a) requires that an adjustment be made effective as of a record date
for a specified event, the Company may elect to defer with prompt notice thereof
to the Rights Agent until the occurrence of such event the issuing to the holder
of any Right exercised after such record date the Preferred Shares and/or other
securities, if any, issuable upon such exercise over and above the Preferred
Shares and/or other securities, if any, issuable before giving effect to such
adjustment; provided, however, that the Company shall deliver to such holder a
due bill or other appropriate instrument evidencing such
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holder's right to receive such additional securities upon the occurrence of the
event requiring such adjustment.
SECTION 13. Certificate of Adjustment. Whenever an adjustment
is made as provided in Section 11 or 12, the Company shall (a) promptly prepare
a certificate setting forth such adjustment and a brief statement of the facts
and computations accounting for such adjustment (b) promptly file with the
Rights Agent and with each transfer agent for the Preferred Shares a copy of
such certificate and (c) mail a brief summary thereof to each holder of a Right
Certificate (or, prior to the Distribution Date, of the Common Shares) in
accordance with Section 25. The Rights Agent shall be fully protected in relying
on any such certificate and on any adjustment therein contained and shall have
no duty with respect to and shall not be deemed to have knowledge of any such
adjustment unless and until it shall have received such Certificate.
SECTION 14. Additional Covenants.
(a) Notwithstanding any other provision of this
Rights Agreement, no adjustment to the number of Preferred Shares (or fractions
of a share) or other securities for which a Right is exercisable or the number
of Rights outstanding or associated with each Common Share or any similar or
other adjustment shall be made or be effective if such adjustment would have the
effect of reducing or limiting the benefits the holders of the Rights would have
had absent such adjustment, including, without limitation, the benefits under
Sections 11 and 12, unless the terms of this Rights Agreement are amended as to
preserve such benefits.
(b) The Company covenants and agrees that, after the
Distribution Date, except as permitted by Section 26, it will not take (or
permit any Subsidiary of the Company to take) any action if at the time such
action is taken it is intended or reasonably foreseeable that such action will
reduce or otherwise limit the benefits the holders of the Rights would have had
absent such action, including, without limitation, the benefits under Sections
11 and 12. Any action taken by the Company during any period after any Person
becomes an Acquiring Person but prior to the Distribution Date shall be null and
void unless such action could be taken under this Section 14(b) from and after
the Distribution Date. The Company shall not consummate any Business Combination
if any issuer of Common Shares for which Rights may be exercised after such
Business Combination in accordance with Section 11(c) shall have taken any
action that reduces or otherwise limits the benefits the holders of the Rights
would have had absent such action, including, without limitation, the benefits
under Sections 11 and 12.
SECTION 15. Fractional Rights and Fractional Shares.
(a) The Company may, but shall not be required to,
issue fractions of Rights or distribute Right Certificates which evidence
fractional Rights. In lieu of such fractional Rights, the Company may pay to the
registered holders of the Right Certificates with regard to which such
fractional Rights would otherwise be issuable an amount in cash equal to the
same fraction of the current Market Value of a whole Right. For purposes of this
Section 15(a), the
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current Market Value of a whole Right shall be the closing price of the Rights
(as determined pursuant to the second and third sentences of the definition of
Market Value contained in Section 1) for the Trading Day immediately prior to
the date on which such fractional Rights would have been otherwise issuable.
(b) The Company may, but shall not be required to,
issue fractions of Preferred Shares upon exercise of the Rights or distribute
certificates which evidence fractional Preferred Shares. In lieu of fractional
Preferred Shares, the Company may elect to (i) utilize a depository arrangement
as provided by the terms of the Preferred Shares or (ii) in the case of a
fraction of a Preferred Share (other than one one-hundredths (1/100ths) of a
Preferred Share or any integral multiple thereof), 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, if any are outstanding and publicly traded (or the Formula
Number times the current Market Value of one Common Share if the Preferred
Shares are not outstanding and publicly traded). For purposes of this Section
15(b), the current Market Value of a Preferred Share (or Common Share) shall be
the closing price of a Preferred Share (or Common Share) (as determined pursuant
to the second and third sentences of the definition of Market Value contained in
Section 1) for the Trading Day immediately prior to the date of such exercise.
If, as a result of an adjustment made pursuant to Section 12(a), the holder of
any Right thereafter exercised shall become entitled to receive any securities
other than Preferred Shares, the provisions of this Section 15(b) shall apply,
as nearly as reasonably may be, on like terms to such other securities.
(c) The Company may, but shall not be required to,
issue fractions of Common Shares upon exchange of Rights pursuant to Section
11(b), or to distribute certificates which evidence fractional Common Shares. In
lieu of such fractional Common Shares, the Company may 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 one Common Share as of the date on which a Person
became an Acquiring Person.
(d) The holder of Rights by the acceptance of the
Rights expressly waives his right to receive any fractional Rights or any
fractional shares upon exercise of a Right except as provided in this Section
15.
SECTION 16. Rights of Action.
(a) All rights of action in respect of this Rights
Agreement except the rights of action given to the Rights Agent under this
Rights Agreement are vested in the respective registered holders of the Right
Certificates (and, prior 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)
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may, in his own behalf and for his own benefit, enforce, and may institute and
maintain any suit, action or proceeding against the Company to enforce, or
otherwise act in respect of, his right to exercise the Rights evidenced by such
Right Certificate in the manner provided in such Right Certificate and in this
Rights Agreement. Without limiting the foregoing or any remedies available to
the holders of Rights, it is specifically acknowledged that the holders of
Rights would not have an adequate remedy at law for any breach of this Rights
Agreement and shall be entitled to specific performance of the obligations of
any Person under, and injunctive relief against actual or threatened violations
of the obligations of any Person subject to, this Rights Agreement.
(b) Any holder of Rights who prevails in an action to
enforce the provisions of this Rights Agreement shall be entitled to recover the
reasonable costs and expenses, including attorneys' fees, incurred in such
action.
SECTION 17. Transfer and Ownership of Rights and Right
Certificates.
(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 will be transferable, subject to Section 7(e), only on the registry
books of the Rights Agent if surrendered at the office of the Rights Agent
designated for such purpose, duly endorsed or accompanied by a proper instrument
of transfer.
(c) The Company and the Rights Agent may deem and
treat the Person in whose name a 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 certificate for Common Shares made by anyone other than the Company
or the Rights Agent) for all purposes whatsoever, and neither the Company nor
the Rights Agent shall be affected by any notice to the contrary.
SECTION 18. Right Certificate Holder Not Deemed a Stockholder.
No holder, as such, of any Right Certificate shall be entitled to vote or
receive dividends or be deemed, for any purpose, the holder of the Preferred
Shares or of any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby, nor shall anything
contained herein or in any 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, including, without limitation, any right to vote for the election
of directors or upon any matter submitted to stockholders at any meeting
thereof, or to give or withhold consent to any corporate action, or to receive
notice of meetings or other actions affecting stockholders, or to receive
dividends or other distributions 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.
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SECTION 19. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent
reasonable compensation for all services rendered by it hereunder and from time
to time, on demand of the Rights Agent, its reasonable expenses and counsel fees
and other disbursements incurred in the administration, preparation, delivery,
amendment and execution of this Rights Agreement and the exercise and
performance of its duties hereunder. The Company also agrees to indemnify the
Rights Agent for, and to hold it harmless against, any loss, liability damage,
judgment, fine, penalty, claim, demand, settlement, cost or expense, incurred
without gross negligence, bad faith or willful misconduct, as determined by a
court of competent jurisdiction, on the part of the Rights Agent, for any action
taken, suffered or omitted by the Rights Agent in connection with the acceptance
and administration of this Agreement, including without limitation the costs and
expenses of defending against any claim of liability arising therefrom, directly
or indirectly. The indemnity provided to the Rights Agent in this Rights
Agreement shall survive the termination of this Agreement and the termination
and the expiration of the Rights. The costs and expenses incurred in enforcing
this right of indemnification shall be paid by the Company.
(b) The Rights Agent shall be authorized and
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 Rights
Agreement in reliance upon any Right Certificate or certificate for the 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.
SECTION 20. Merger or Consolidation or Change of Rights
Agent.
(a) Any Person into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be consolidated, or
any Person resulting from any merger or consolidation to which the Rights Agent
or any successor Rights Agent shall be a party, or any Person 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 Rights
Agreement without the execution or filing of any paper or any further act on the
part of any of the parties hereto; provided that such corporation would be
eligible for appointment as a successor Rights Agent under the provisions of
Section 22. In case, at the time such successor Rights Agent shall succeed to
the agency created by this Rights 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 case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Right Certificates either in the name of the predecessor Rights
Agent or in the name of the successor Rights Agent; and in all such cases such
Right Certificates shall have the full force provided in the Right Certificates
and in this Rights Agreement.
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(b) In case at any time the name of the Rights Agent
shall be changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver Right Certificates so countersigned; 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 Rights Agreement.
SECTION 21. Duties of Rights Agent. The Rights Agent
undertakes only the duties and obligations expressly imposed by this Rights
Agreement upon the following terms and conditions, by all of which the Company
and the holders of Right Certificates (or, prior to the Distribution Date, of
the Common Shares), by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel
(who may be legal counsel for the Company), and the advice or 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 advice or opinion.
(b) Whenever in the performance of its duties under
this Rights Agreement the Rights Agent shall deem it necessary or desirable that
any fact or matter (including, without limitation, the identity of any Acquiring
Person and the determination of current per share market price) be proved or
established by the Company prior to taking, refraining from taking or suffering
any action hereunder, such fact or matter (unless other evidence in respect
thereof be herein specifically prescribed) may be deemed to be conclusively
proved and established by a certificate signed by any one of the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, a Vice President (whether preceded by any
additional title), the Treasurer or the Secretary of the Company and delivered
to the Rights Agent; and such certificate shall be full authorization and
protection to the Rights Agent and the Rights Agent shall incur no liability for
or in respect of any action taken, suffered or omitted in good faith by it under
the provisions of this Rights Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only
for its own gross negligence, bad faith or willful misconduct as determined by a
court of competent jurisdiction; provided, however, that anything to the
contrary notwithstanding in no event shall the Rights Agent be liable for
special, punitive, indirect, consequential or incidental loss or damage of any
kind whatsoever (including but not limited to lost profits), even if the Rights
Agent has been advised of the likelihood of such loss or damage.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained in this Rights
Agreement or in the Right Certificates (except as to 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.
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(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Rights Agreement or the
execution and delivery hereof (except the due execution hereof by the Rights
Agent) or in respect of the validity or execution of any Right Certificate
(except its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this Rights
Agreement or in any Right Certificate; nor shall it be responsible for any
adjustment required under the provisions of Section 11 or 12 or responsible for
the manner, method or amount of any such adjustment or the ascertaining of the
existence of facts that would require any such adjustment (except with respect
to the exercise of Rights evidenced by Right Certificates after actual notice of
any such adjustment); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any
Preferred Shares or Common Shares to be issued pursuant to this Rights Agreement
or any Right Certificate or as to whether any Preferred Shares or Common Shares
will, when so issued, be validly authorized and issued, fully paid and
nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying out or performing by
the Rights Agent of the provisions of this Rights Agreement.
(g) The Rights Agent is hereby authorized and
directed to accept instructions with respect to the performance of its duties
hereunder from any one of the Chairman of the Board, the Chief Executive
Officer, the President, the Chief Operating Officer, a Vice President (whether
preceded by any additional title), the Secretary or the Treasurer of the
Company, in connection with its duties and it shall not be liable for any action
taken or suffered or omitted to be taken by it in good faith in accordance with
instructions of any such officer. 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, suffered or omitted by the
Rights Agent under this Agreement and the date on and/or after which such action
shall be taken or suffered or such omission shall be effective. The Rights Agent
shall not be liable for any action taken or suffered 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 Business Days after the date any officer of the Company actually
receives 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, suffered or omitted.
(h) The Rights Agent and any stockholder, director,
affiliate, 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
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interested, or contract with or lend money to the Company or otherwise act as
fully and freely as though it were not the Rights Agent under this Rights
Agreement. Nothing herein shall preclude the Rights Agent from acting in any
other capacity for the Company or for any other Person.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty hereunder either
itself or by or through its attorneys or agents, and the Rights Agent shall not
be answerable or accountable for any act, default, neglect or misconduct of any
such attorneys or agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct absent gross negligence, bad faith or wilful
misconduct, as determined by a court of competent jurisdiction, in the selection
and continued employment thereof.
(j) The Company agrees to indemnify and to hold the
Rights Agent harmless against any loss, liability, damage, judgment, fine,
penalty, claim, demand, settlement, cost or expense (including reasonable fees
and expenses of counsel) which the Rights Agent may incur resulting from actions
taken, suffered or omitted by it pursuant to this Rights Agreement; provided,
however, that the Rights Agent shall not be indemnified or held harmless with
respect to any such loss, liability, damage or expense incurred by the Rights
Agent as a result of, or arising out of, its own gross negligence, bad faith or
willful misconduct, as determined by a court of competent jurisdiction. The
Rights Agent will use reasonable efforts to promptly notify the Company, by
letter or by facsimile confirmed by letter, of the assertion of any action,
proceeding, suit or claim against the Rights Agent, after the Rights Agent shall
have notice, or otherwise have knowledge, of any such assertion of an action,
proceeding, suit or claim or has been served with the summons or other first
legal process giving information as to the nature and basis of the action,
proceeding, suit or claim. The Company shall be entitled to participate at its
own expense in the defense of any such action, proceeding, suit or claim, and,
if the Company so elects, the Company shall assume the defense of any such
action, proceeding, suit or claim. In the event that the Company assumes such
defense, the Company shall not thereafter be liable for the fees and expenses of
any additional counsel retained by the Rights Agent, so long as the Company
shall retain counsel satisfactory to the Rights Agent, in the exercise of its
reasonable judgment, to defend such action, proceeding, suit or claim; provided,
however, that if in the judgment of counsel for the Rights Agent, the use of
such counsel retained by the Company to represent both the Company and the
Rights Agent would pose a conflict of interest, then the Rights Agent shall be
permitted to retain additional counsel the reasonable fees and expenses of which
shall be payable by the Company. The Rights Agent agrees not to settle any
litigation in connection with any action, proceeding, suit or claim with respect
to which it may seek indemnification from the Company without the prior written
consent of the Company which consent shall not be unreasonably withheld. 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 it believes that
repayment of such funds or adequate indemnification against such risk or
liability is not reasonably assured to it.
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(k) If, with respect to any Rights Certificate
surrendered to the Rights Agent for exercise or transfer, the certificate
contained in the form of assignment or the form of election to purchase set
forth on the reverse thereof, as the case may be, has not been completed to
certify the holder is not an Acquiring person (or an Affiliate or Associate
thereof), the Rights Agent shall not take any further action with respect to
such requested exercise or transfer without first consulting with the Company.
SECTION 22. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties under this
Rights Agreement upon 30 days' notice in writing mailed to the Company and to
each transfer agent of the Common Shares and the Preferred Shares by registered
or certified mail, and to the holders of the Right Certificates (or, prior to
the Distribution Date, of the Common Shares) by first-class mail. The Company
may remove the Rights Agent or any successor Rights Agent upon 30 days' notice
in writing, mailed to the Rights Agent or successor Rights Agent, as the case
may be, and to each transfer agent of the Common Shares and the Preferred Shares
by registered or certified mail, and to the holders of the Right Certificates
(or, prior to the Distribution Date, of the Common Shares) by first-class mail.
If the Rights Agent shall resign or be removed or shall otherwise become
incapable of acting, the Company shall appoint a successor to the Rights Agent.
If the Company shall fail to make such appointment within a period of 30 days
after giving notice of such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Rights Agent or
by the holder of a Right Certificate (or, prior to the Distribution Date, of the
Common Shares) (who shall, with such notice, submit his Right Certificate or,
prior to the Distribution Date, the certificate representing his Common Shares,
for inspection by the Company), then the registered holder of any Right
Certificate (or, prior to the Distribution Date, of the Common Shares) 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, in good standing, which is
authorized to do business under such laws and is subject to supervision or
examination by Federal or state authority and which has at the time of its
appointment as Rights Agent a combined capital and surplus of at least
$50,000,000; provided that the principal transfer agent for the Common Shares
shall in any event be qualified to be the Rights Agent. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall deliver and transfer
to the successor Rights Agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose. Not later than the effective date of any such appointment, the
Company shall file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common Shares and the Preferred Shares, and mail
a notice thereof in writing to the registered holders of the Right Certificates
(or, prior to the Distribution Date, of the Common Shares). Failure to give any
notice provided for in this Section 22, 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.
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SECTION 23. Issuance of Additional Rights and Right
Certificates. Notwithstanding any of the provisions of this Rights Agreement or
of the Rights to the contrary, the Company may, at its option, issue new Right
Certificates evidencing Rights in such form as may be approved by its Board of
Directors to reflect any adjustment or change made in accordance with the
provisions of this Rights Agreement. In addition, in connection with the
issuance or sale of Common Shares following the Distribution Date and prior to
the earlier of the Redemption Date and the Expiration Date, the Company (a)
shall, with respect to Common Shares so issued or sold pursuant to the exercise
of stock options or under any employee plan or arrangement, or upon the
exercise, conversion or exchange of securities, notes or debentures issued by
the Company, and (b) may, in any other case, if deemed necessary or appropriate
by the Board of Directors of the Company, issue Right Certificates representing
the appropriate number of Rights in connection with such issuance or sale;
provided, however, that (i) no such Right Certificate shall be issued if, and to
the extent that, the Company shall be advised by counsel that such issuance
would create a significant risk of material adverse tax consequences to the
Company or the Person to whom such Right Certificate would be issued, and (ii)
no such Right Certificate shall be issued if, and to the extent that,
appropriate adjustment shall otherwise have been made in lieu of the issuance
thereof.
SECTION 24. Redemption and Termination.
(a) The Board of Directors of the Company may, at its
option, at any time prior to the earlier of (i) such time as a Person becomes an
Acquiring Person and (ii) the Expiration Date, order the redemption of all, but
not fewer than all, the then outstanding Rights at the Redemption Price (the
date of such redemption being the 'Redemption Date'), and the Company, at its
option, may pay the Redemption Price either in cash or Common Shares or other
securities of the Company deemed by the Board of Directors of the Company, in
the exercise of its sole discretion, to be at least equivalent in value to the
Redemption Price; provided, however, such redemption is subject to any
limitations contained herein on the right to redeem outstanding Rights
(including the occurrence of any event or the expiration of any period after
which the Rights may no longer be redeemed).
(b) Immediately upon the action of the Board of
Directors of the Company ordering the redemption of the Rights, and without any
further action and without any notice, the right to exercise the Rights will
terminate and the only right thereafter of the holders of Rights shall be to
receive the Redemption Price. Within 10 Business Days after the action of the
Board of Directors of the Company ordering the redemption of the Rights, the
Company shall give notice of such redemption to the Rights Agent and to the
holders of the then outstanding Rights by mailing such notice to all such
holders at their last addresses as they appear upon the registry books of the
Rights Agent or, prior to the Distribution Date, on the registry books of the
transfer agent for the Common Shares. Each such notice of redemption will state
the method by which payment of the Redemption Price will be made. The notice, if
mailed in the manner herein provided, shall be conclusively presumed to have
been duly given, whether or not the holder of Rights receives such notice. In
any case, failure to give such notice by mail, or any defect in the notice, to
any particular holder of Rights shall not affect the sufficiency of the notice
to other holders of Rights.
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SECTION 25. Notices. Notices or demands authorized by this
Agreement to be given or made by the Rights Agent or by the holder of a Right
Certificate (or, prior to the Distribution Date, of the Common Shares) 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:
Systems & Computer Technology Corporation
Great Valley Corporate Center
4 Country View Road
Malvern, PA 19355
Attention of General Counsel
Subject to the provisions of Section 22, any notice or demand
authorized by this Rights Agreement to be given or made by the Company or by the
holder of a Right Certificate (or, prior to the Distribution Date, of the Common
Shares) 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:
ChaseMellon Shareholder Services L.L.C.
450 West 33rd Street, 10th Floor
New York, NY 10001
Attention: Monty Harry
Notices or demands authorized by this Rights Agreement to be given or made by
the Company or the Rights Agent to any holder of a Right Certificate (or, prior
to the Distribution Date, of the Common Shares) 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 Rights Agent
or, prior to the Distribution Date, on the registry books of the transfer agent
for the Common Shares.
SECTION 26. Supplements and Amendments. At any time prior to
the Distribution Date and subject to the last sentence of this Section 26, the
Company may, and the Rights Agent shall if the Company so directs, supplement or
amend any provision of this Rights Agreement (including, without limitation, the
date on which the Distribution Date shall occur, the time during which the
Rights may be redeemed pursuant to Section 24 or any provision of the
Certificate of Designation) without the approval of any holder of the Rights.
From and after the Distribution Date and subject to applicable law, the Company
may, and the Rights Agent shall if the Company so directs, amend this Rights
Agreement without the approval of any holders of Right Certificates (i) to cure
any ambiguity or to correct or supplement any provision contained herein which
may be defective or inconsistent with any other provision of this Rights
Agreement or (ii) to make any other provisions in regard to matters or questions
arising hereunder which the Company may deem necessary or desirable and which
shall not adversely affect the interests of the
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<PAGE>
holders of Right Certificates (other than an Acquiring Person or an Affiliate or
Associate of an Acquiring Person). Any supplement or amendment adopted during
any period after any Person has become an Acquiring Person but prior to the
Distribution Date shall be null and void unless such supplement or amendment
could have been adopted under the prior sentence from and after the Distribution
Date. Upon the delivery of a certificate from an appropriate officer of the
Company which states that the proposed supplement or amendment is in compliance
with the terms of this Section 26, the Rights Agent shall execute such
supplement or amendment, provided that such supplement or amendment does not
adversely alter, change or increase the rights, duties, liabilities and
obligations of the Rights Agent under this Agreement. Notwithstanding anything
to the contrary contained in this Rights Agreement, no supplement or amendment
to this Rights Agreement shall be made which (a) reduces the Redemption Price
(except as required by Section 12(a)) or (b) provides for an earlier Expiration
Date.
SECTION 27. Successors. All the covenants and provisions of
this Rights Agreement by or for the benefit of the Company or the Rights Agent
shall bind and inure to the benefit of their respective successors and assigns
hereunder.
SECTION 28. Benefits of Rights Agreement; Determinations and
Actions by the Board of Directors, etc.
(a) Nothing in this Rights Agreement shall be
construed to give to any Person other than the Company, the Rights Agent and the
registered holders of the Right Certificates (and prior to the Distribution
Date, of the Common Shares) any legal or equitable right, remedy or claim under
this Rights Agreement; but this Rights Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the registered holders of
the Right Certificates (and, prior to the Distribution Date, of the Common
Shares).
(b) Except as explicitly otherwise provided in this
Rights Agreement, the Board of Directors of the Company shall have the exclusive
power and authority, to administer this Rights Agreement and to exercise all
rights and powers specifically granted to the Board of Directors of the Company
or to the Company, or as may be necessary or advisable in the administration of
this Rights Agreement, including, without limitation, the right and power to (i)
interpret the provisions of this Rights Agreement and (ii) make all
determinations deemed necessary or advisable for the administration of this
Rights Agreement (including, without limitation, a determination to redeem or
not redeem the Rights or to amend this Rights Agreement and a determination of
whether there is an Acquiring Person).
(c) Nothing contained in this Rights Agreement shall
be deemed to be in derogation of the obligation of the Board of Directors of the
Company to exercise its fiduciary duty. Without limiting the foregoing, nothing
contained herein shall be construed to suggest or imply that the Board of
Directors shall not be entitled to reject any tender offer, or to recommend that
holders of Common Shares reject any tender offer, or to take any other action
(including, without limitation, the commencement, prosecution, defense or
settlement of any litigation and the
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<PAGE>
submission of additional or alternative offers or other proposals) with respect
to any tender offer that the Board of Directors believes is necessary or
appropriate in the exercise of such fiduciary duty.
SECTION 29. Severability. If any term, provision, covenant or
restriction of this Rights Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions of this Rights
Agreement shall remain in full force and effect and shall in no way be affected,
impaired or invalidated; provided that, anything in this Rights Agreement to the
contrary notwithstanding, if any such term, provision, covenant or restriction
is held by such court or authority to be invalid, void or unenforceable and the
Board of Directors of the Company determines in its good faith judgment that
severing the invalid language from this Rights Agreement would adversely affect
the purpose or effect of this Rights Agreement, the right of redemption set
forth in Section 24 hereof shall be reinstated and shall not expire until the
Close of Business on the tenth day following the date of such determination by
the Board of Directors of the Company.
SECTION 30. Governing Law. This Rights Agreement and each
Right Certificate issued hereunder shall be deemed to be a contract made under
the law of the State of Delaware and for all purposes shall be governed by and
construed in accordance with the law of such State applicable to contracts to be
made and performed entirely within such State; provided however, that all
provisions regarding the rights, duties and obligations of the Rights Agent
shall be governed by and construed in accordance with the laws of the State of
New York applicable to contracts made and to be performed entirely within such
State.
SECTION 31. Counterparts; Effectiveness. The Rights Agreement
may be executed in any number of counterparts and each of such counterparts
shall for all purposes be deemed to be an original, and all such counterparts
shall together constitute but one and the same instrument. This Rights Agreement
shall be effective as of the Close of business on the date hereof.
SECTION 32. Descriptive Headings. Descriptive headings of the
several Sections of this Rights Agreement are inserted for convenience only and
shall not control or affect the meaning or construction of any of the provisions
of this Rights Agreement.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Rights
Agreement to be duly executed as of the day and year first above written.
SYSTEMS & COMPUTER TECHNOLOGY CORPORATION
By:
--------------------------------------------------
Name: Richard A. Blumenthal
Title: Senior Vice President, General Counsel and
Secretary
Attest:
- ----------------------
Name:
Title:
Countersigned:
ChaseMellon Shareholder Services L.L.C., as Rights Agent,
By:
-----------------------
Name: James Hagan
Title: Vice President
Authorized Officer
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<PAGE>
EXHIBIT A
CERTIFICATE OF DESIGNATION OF
POWERS, RIGHTS AND PREFERENCES OF
SYSTEMS & COMPUTER TECHNOLOGY CORPORATION
SERIES A PARTICIPATING PREFERRED STOCK
SECTION 1. Designation and Amount. The shares of such series
shall be designated as "Series A Participating Preferred Stock" (the "Series A
Preferred Stock") and the number of shares constituting the Series A Preferred
Stock shall be 1,000,000. Such number of shares may be increased or decreased by
resolution of the Board of Directors of Systems & Computer Technology
Corporation (hereinafter referred to as "Corporation"); provided, that no
decrease shall reduce the 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 Common Stock,
$.01 par value 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 the greater of (a) $1.00 or (b) subject
to the provision for adjustment hereinafter set forth, 100
times the aggregate per share amount of all cash dividends,
and 100 times the aggregate per share amount (payable in kind)
of all non-cash dividends or other distributions, other than a
dividend payable in shares of Common Stock or a subdivision of
the outstanding shares of Common Stock (by reclassification or
otherwise), declared on the Common Stock since the immediately
preceding Quarterly Dividend Date or, with respect
A-1
<PAGE>
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); provided that, in
the event no dividend or distribution shall have been declared
on the Common Stock during the period between any Quarterly
Dividend Payment Date and the next subsequent Quarterly
Dividend Payment Date, a dividend of $1.00 per share on the
Series A Preferred Stock shall nevertheless be payable on such
subsequent Quarterly Dividend Payment Date; and further
provided that, in no event shall any dividend or distribution
declared on the Common Stock during any such period be paid
unless and until the dividends or distributions on the Series
A Preferred Stock declared or otherwise payable hereunder have
been paid.
(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
A-2
<PAGE>
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 no
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.
(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.
A-3
<PAGE>
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.
A-4
<PAGE>
(B) The Corporation shall not permit any subsidiary
of the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the Corporation unless
the Corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in
such manner.
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 $1.00 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not declared,
to the date of such payment, provided that the holders of shares of 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 amount of stock,
securities, cash and/or any
A-5
<PAGE>
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 Company
shall at any time declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or issue additional shares of Common Stock in such
consolidation, merger, combination or other transaction after which the Common
Stock remains outstanding, 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.
(A) None of the powers, preferences and relative,
participating, optional and other special rights of the Series A Preferred Stock
as provided herein or in the Certificate of Incorporation shall be amended in
any manner which would alter or change the powers, preferences, rights or
privileges of the holders of Series A Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of at least 66-2/3% of the
outstanding shares of Series A Preferred Stock, voting as a separate class.
(B) No amendment under subsection (A) of this
Section 10 shall be deemed to apply to any shares of Series A Preferred Stock
originally issued prior to the effective date of such amendment without the
approval of the holder of such shares.
A-6
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused this Certificate to be
duly executed in its corporate name on this 13th day of April 1999.
SYSTEMS & COMPUTER TECHNOLOGY CORPORATION
By: ---------------------------------------------------
Name: Richard A. Blumenthal, Esquire
Title: Senior Vice President, General Counsel and
Secretary
Attest:
- ---------------------------
Name:
Title:
A-7
<PAGE>
EXHIBIT B
[Form of Right Certificate]
Certificate No. [R]
_________________ Rights
NOT EXERCISABLE AFTER APRIL 13, 2009, OR EARLIER IF REDEEMED
BY THE COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE
OPTION OF THE COMPANY, AT $.01 PER RIGHT, ON THE TERMS SET
FORTH IN THE RIGHTS AGREEMENT. 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
BY ANY SUBSEQUENT HOLDER OF SUCH RIGHTS ARE NULL AND VOID AND
NONTRANSFERABLE.
Right Certificate
SYSTEMS & COMPUTER TECHNOLOGY CORPORATION
This certifies that __________, or registered assigns, is the
registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the
Stockholder Rights Agreement dated as of April 13, 1999 (the "Rights
Agreement"), between Systems & Computer Technology Corporation, a Delaware
corporation (the "Company"), and ChaseMellon Shareholder Services L.L.C. as
Rights Agent (the "Rights Agent"), unless the Rights evidenced hereby shall have
been previously redeemed by the Company, to purchase from the Company at any
time after the Distribution Date (as defined in the Rights Agreement) and prior
to 5:00 p.m., New York City time, on the 10th anniversary of the date of the
Rights Agreement (the "Expiration Date"), at the principal office of the Rights
Agent, or its successors as Rights Agent, in the City of New York, New York,
one-hundredths (1/100ths) of a fully paid, nonassessable share of Series A
Participating Preferred Stock, par value $.10 per share, of the Company (the
"Preferred Shares"), at a purchase price per one one-hundredths (1/100ths) of a
share equal to $100 (the "Purchase Price") payable in cash, upon presentation
and surrender of this Right Certificate with the Form of Election to Purchase
duly executed.
B-1
<PAGE>
The Purchase Price and the number and kind of shares which may be
purchased upon exercise of each Right evidenced by this Right Certificate, as
set forth above, are the Purchase Price and the number and kind of shares which
may be so purchased as of April 16, 1999. As provided in the Rights Agreement,
the Purchase Price and the number and kind of shares which may be purchased upon
the exercise of each Right evidenced by this Right Certificate are subject to
modification and adjustment upon the happening of certain events.
If the Rights evidenced by this Right Certificate are at any time
beneficially owned by an Acquiring Person or an Affiliate or Associate of an
Acquiring Person (as such terms are defined in the Rights Agreement), such
Rights shall be null and void and nontransferable and the holder of any such
Right (including any purported transferee or subsequent holder) shall not have
any right to exercise or transfer any such Right.
This Right Certificate is subject to all 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
reference to the Rights Agreement is hereby made for a full description of the
rights, limitations of rights, obligations, duties and immunities hereunder of
the Rights Agent, the Company and the holders of the Right Certificates. Copies
of the Rights Agreement are on file at the above-mentioned office of the Rights
Agent and are also available from the Company upon written request.
This Right Certificate, with or without other Right Certificates, upon
surrender at the office of the Rights Agent designated for such purposes 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
and kind of 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 Right Certificate may be redeemed by the Company at its option at a
redemption price (in cash or shares of Common Stock or other securities of the
Company deemed by the Board of Directors to be at least equivalent in value) of
$.01 per Right (which amount shall be subject to adjustment as provided in the
Rights Agreement) at any time prior to the earlier of (i) such time as a Person
becomes an Acquiring Person and (ii) the Expiration Date.
The Company may, but shall not be required to, issue fractions of
Preferred Shares or distribute certificates which evidence fractions of
Preferred Shares upon the exercise of any Right or Rights evidenced hereby. In
lieu of issuing fractional shares, the Company may elect to make a cash payment
as provided in the Rights Agreement for fractions of a share other than one
one-hundredths (1/100ths) of a share or any integral multiple thereof or to
issue certificates or utilize a depository arrangement as provided in the terms
of the Rights Agreement and the Preferred Shares.
B-2
<PAGE>
No holder of this Right Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Preferred
Shares or of any other securities of the Company which may at any time be
issuable on the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any
of the rights of a stockholder of the Company, including, without limitation,
any right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in the Rights Agreement), or to receive
dividends or other distributions or subscription rights, or otherwise, until the
Right or Rights evidenced by this Right Certificate shall have been exercised as
provided in accordance with the provisions of 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 facsimile signature of the proper officers of the Company
and its corporate seal.
Dated as of _________________.
SYSTEMS & COMPUTER TECHNOLOGY CORPORATION
By:
--------------------------------------
Name:
Title:
Attest:
- -------------------------
Name:
Title:
Countersigned:
ChaseMellon Shareholder Services L.L.C., as Rights Agent,
By:_______________________________
Authorized Officer
[On Reverse Side of Right Certificate]
B-3
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed by the registered holder if such holder desires to exercise the
Rights represented by this Right Certificate.)
To the Rights Agent:
The undersigned hereby irrevocably elects to exercise ______________
Rights represented by this Right Certificate to purchase the Preferred Shares
(or other shares) issuable upon the exercise of such Rights and requests that
certificates for such 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: _____________, __
---------------------------------
Signature
Signature Guaranteed:
NOTICE
The signature on the foregoing Form of Election to Purchase must
correspond to the name as written upon the face of this Right Certificate in
every particular, without alteration or enlargement or any change whatsoever.
B-4
<PAGE>
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Right Certificate ___are
___are not being exercised by or on behalf of a Person who is or was an
Acquiring Person or an Affiliate or Associate of any such Acquiring Person (as
such terms are defined in the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it ___did ___did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Dated: _____________, ___ ________________________________
Signature
________________________
The signature to the foregoing Election to Purchase and Certificate must
correspond to the name as written upon the face of this Right Certificate in
every particular, without alteration or enlargement or any change whatsoever.
B-5
<PAGE>
Form of Assignment
(To be executed if the registered 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: __________________, ____
______________________________
Signature
Signature Guaranteed:
B-6
<PAGE>
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Right Certificate ___are
___are not being assigned by or on behalf of a Person who is or was an Acquiring
Person or an Affiliate or Associate of any such Acquiring Person (as such terms
are defined in the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it ___did ___did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Dated: _____________, ___ ________________________________
Signature
________________________
The signature to the foregoing Assignment and Certificate must correspond to the
name as written upon the face of this Right Certificate in every particular,
without alteration or enlargement or any change whatsoever.
B-7
<PAGE>
Monday March 22, 1:55 Eastern Time
Company Press Release
SOURCE: Systems & Computer Technology Corporation
Systems & Computer Technology
Corporation Announces Adoption of Shareholder Rights Plan
MALVERN, Pa., March 22/PRNewswire/ -- The Board of Directors of Systems &
Computer Technology Corporation (Nasdaq: SCTC-news) has adopted a Shareholder
Rights Plan pursuant to which the Company will distribute one Preferred Share
Purchase Right (at an exercise price of $ 100) for each outstanding share of SCT
common stock. The Rights will be exercisable only if a person or group acquires
15% or more of SCT common stock or announces a tender offer the consummation of
which would result in ownership by a person or group of 15% or more of the
common stock. SCT will be entitled to redeem the Rights at one cent per Right
during a specified period of time after public announcement that any person or
group has acquired 15% or more of the Company's Common Stock.
The Rights are not being distributed in response to any specific effort to
acquire control of the Company, and the Board is not aware of any such effort.
The Rights are not intended to prevent a takeover which is in the best interests
of all the stockholders, but are designed to assure that all SCT stockholders
realize the long-term value of their investment, receive fair and equal
treatment, to guard against abusive tactics to gain control of the Company and
to encourage anyone seeking to acquire the Company to negotiate with the Board
prior to attempting a takeover.
The Rights will be distributed on April 16, 1999 to shareholders of record on
April 9, 1999. Details of the Rights distribution are contained in a letter
which is being mailed to all SCT stockholders.
SCT, headquartered in Malvern, PA, is a leading provider of client/server,
mission-critical, enterprise software and a series of information technology
services for higher education, manufacturing and distribution, government, and
utilities. The company provides long-term information and technology solutions
and is a recognized leader in outsourcing. SCT has approximately 3,600 employees
and serves more than 2,500 clients worldwide. For more information, visit SCT's
Web site at www.sctcorp.com.
SOURCE: Systems & Computer Technology Corporation
http://biz.yahoo.com 4/12/99
