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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
______
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
VILLAGE BANCORP, INC.
-----------------------------------------------------
(Exact name of registrant as specified in its charter)
CONNECTICUT 06-1076844
- ---------------------------------------- ----------------------------------
(State of incorporation or organization) (IRS Employer Identification No.)
25 Prospect Street, Ridgefield, CT 06877
- ---------------------------------------- ----------------------------------
(Address of principal executive offices) (Zip Code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
------------------- ------------------------------
Common Stock Purchase Rights NASDAQ
Securities to be registered pursuant to Section 12(g) of the Act:
None
----------------------------------------
(Title of Class)
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Item 1. Description of Registrant's Securities to be Registered.
--------------------------------------------------------
On September 19, 1996, the Board of Directors of Village Bancorp,
Inc. (the "Company") declared a dividend of one common stock purchase
right (a "Right") for each outstanding share of common stock, par value
$3.33 per share (the "Common Stock"), of the Company payable to holders of
record as of the close of business on October 4, 1996 (the "Record Date").
Prior to the Distribution Date (as defined below), the Rights
will be evidenced by the certificates for and will be transferred with the
Common Stock, and the registered holders of the Common Stock will be deemed to
be the registered holders of the Rights. After the Distribution Date, the
Rights Agent will mail separate certificates evidencing the Rights to each
record holder of the Common Stock as of the close of business on the
Distribution Date, and thereafter the Rights will be transferable separately
from the Common Stock. The "Distribution Date" means the earlier of (i) the
10th day (or such later day as may be designated by a majority of the
Continuing Directors (as hereinafter defined)) after the date (the "Stock
Acquisition Date") of the first public announcement that a person (other than
the Company or any of its subsidiaries or any employee benefit plan of the
Company or any such subsidiary) has acquired beneficial ownership of 15% or
more of the outstanding shares of Common Stock (an "Acquiring Person") and
(ii) the 10th business day (or such later day as may be designated by a
majority of the Continuing Directors) after the date of the commencement of a
tender or exchange offer by any person which would, if consummated, result in
such person becoming an Acquiring Person.
Prior to the Distribution Date, the Rights will not be
exercisable. After the Distribution Date, each Right will be exercisable to
purchase, for $6.00 (the "Purchase Price"), one-tenth of a share of Common
Stock. The terms and conditions of the Rights are set forth in a Rights
Agreement dated as of September 19, 1996 between the Company and American
Stock Transfer & Trust Company, as Rights Agent (the "Rights Agreement"), a
copy of which is attached as an exhibit hereto and the description thereof is
qualified in its entirety by reference thereto.
If any person becomes an Acquiring Person, each Right (other
than Rights beneficially owned by the Acquiring Person and certain affiliated
persons) will entitle the holder to purchase, for ten times the Purchase Price
(the "Adjusted Purchase Price"), a number of shares of Common Stock having a
market value of twice the Adjusted Purchase Price.
If, after any person has become an Acquiring Person, (1) the
Company is involved in a merger or other business combination in which the
Company is not the surviving corporation or its Common Stock is exchanged for
other securities or assets or (2) the Company and/or one or more of its
subsidiaries sell or otherwise transfer assets or earning power aggregating
more than 50% of the assets or earning power of the Company and its
subsidiaries, taken as a whole, then each Right will entitle the holder to
purchase, for the Adjusted Purchase Price, a number of shares of common stock
of the other party to such business combination or sale (or in certain
circumstances, an affiliate) having a market value of twice the Adjusted
Purchase Price.
At any time after any person has become an Acquiring Person
(but before any person becomes the beneficial owner of 50% or more of the
outstanding shares of Common Stock), a majority of the Continuing Directors
may exchange all or part of the Rights (other than Rights beneficially owned
by an Acquiring Person and certain affiliated persons) for shares of Common
Stock at an exchange ratio of one share of Common Stock per Right.
The Board of Directors may redeem all of the Rights at a price
of $.01 per Right at any time prior to the close of business on the 10th day
after the Stock Acquisition Date (or such later date as may be designated by a
majority of the Continuing Directors). After any person has become an
Acquiring Person, the Rights may be redeemed only with the approval of a
majority of the Continuing Directors.
"Continuing Director" means any member of the Board of
Directors who was a member of the Board prior to the time an Acquiring Person
becomes such or any person who is subsequently elected to the Board if such
person is recommended or approved by a majority of the Continuing Directors.
Continuing Directors do not include an Acquiring Person, an affiliate or
associate of an Acquiring Person or any representative or nominee of the
foregoing.
The Rights will expire on October 4, 2006, unless earlier
exchanged or redeemed.
Prior to the Distribution Date, the Rights Agreement may be
amended in any respect. After the Distribution Date, the Rights Agreement may
be amended in any respect that does not adversely affect Rights holders (other
than any Acquiring Person and certain affiliated persons). After any person
has become an Acquiring Person, the Rights Agreement may be amended only with
the approval of a majority of the Continuing Directors.
Rights holders have no rights as a stockholder of the Company,
including the right to vote and to receive dividends.
The Rights Agreement includes antidilution provisions designed
to prevent efforts to diminish the effectiveness of the Rights.
As of September 19, 1996 there were 951,422 shares of Common
Stock outstanding and 96,016 shares reserved for issuance under the Company's
stock option plans. Each outstanding share of Common Stock on the Record Date
will receive one Right. Shares of Common Stock issued after the Record Date
and prior to the Distribution Date will be issued with a Right attached so
that all shares of Common Stock outstanding prior to the Distribution Date
will have Rights attached. 154,744 shares of Common Stock have been reserved
for issuance upon exercise of the Rights.
The Rights have certain anti-takeover effects. The Rights may
cause substantial dilution to a person that attempts to acquire the Company
without a condition to such an offer that a substantial number of the Rights
be acquired or that the Rights be redeemed or declared invalid. The Rights
should not interfere with any merger or other business combination approved by
the Board of Directors (under some circumstances, with the concurrence of the
Continuing Directors) since the Rights may be redeemed by the Company as
described above.
While the dividend of the Rights will not be taxable to
stockholders or to the Company, stockholders or the Company may, depending
upon the circumstances, recognize taxable income in the event that the Rights
become exercisable as set forth above.
Item 2. Exhibits
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1 and 2. Form of Rights Agreement dated as of September 19,
1996 between Village Bancorp, Inc. and American
Stock Transfer & Trust Company, as Rights Agent,
which includes as Exhibit A thereto the form of
Right Certificate.
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this registration statement to
be signed on its behalf by the undersigned thereto duly authorized.
VILLAGE BANCORP, INC.
/s/ Robert V. Macklin
By _________________________________________
Name: Robert V. Macklin
Title: President/Chief Executive Officer
Dated: September 25, 1996
EXHIBIT INDEX
Exhibit
Number Description of Exhibit Page
------- ---------------------- ----
1 and 2 Form of Rights Agreement
dated as of September 19,
1996 between Village
Bancorp, Inc. and American
Stock Transfer & Trust
Company, as Rights Agent,
which includes as Exhibit
A thereto the form of Right
Certificate.
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RIGHTS AGREEMENT
dated as of
September 19, 1996
between
Village Bancorp, Inc.
and
American Stock Transfer & Trust Company,
as Rights Agent
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TABLE OF CONTENTS
Page
----
Section 1. Definitions....................................................1
Section 2. Appointment of Rights Agent....................................4
Section 3. Issue of Right Certificates....................................4
Section 4. Form of Right Certificates.....................................6
Section 5. Countersignature and Registration..............................6
Section 6. Transfer and Exchange of Right Certificates; Mutilated,
Destroyed, Lost or Stolen Right Certificates.................7
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights..7
Section 8. Cancellation and Destruction of Right Certificates.............9
Section 9. Reservation and Availability of Capital Stock..................9
Section 10. Common Stock Record Date......................................10
Section 11. Adjustment of Purchase Price, Number and Kind of Shares or
Number of Rights............................................11
Section 12. Certificate of Adjusted Purchase Price or Number of Shares....18
Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power...............................................18
Section 14. Fractional Rights and Fractional Shares.......................20
Section 15. Rights of Action..............................................21
Section 16. Agreement of Right Holders....................................22
Section 17. Right Certificate Holder Not Deemed a Stockholder.............23
Section 18. Concerning the Rights Agent...................................23
Section 19. Merger or Consolidation or Change of Name of Rights Agent.....23
Section 20. Duties of Rights Agent........................................24
Section 21. Change of Rights Agent........................................26
Section 22. Issuance of New Right Certificates............................27
Section 23. Redemption....................................................27
Section 24. Exchange......................................................28
Section 25. Notice of Proposed Actions....................................28
Section 26. Notices.......................................................29
Section 27. Supplements and Amendments....................................30
Section 28. Successors....................................................30
Section 29. Determinations and Actions by the Board of Directors, etc.....30
Section 30. Benefits of this Agreement....................................31
Section 31. Severability..................................................31
Section 32. Governing Law.................................................31
Section 33. Counterparts..................................................31
Section 34. Descriptive Headings..........................................31
Exhibit A - Form of Rights Certificate
Exhibit B - Summary Description of Stockholders Rights Plan
RIGHTS AGREEMENT
AGREEMENT dated as of September 19, 1996, between Village Bancorp,
Inc., a Connecticut corporation (the "Company"), and American Stock Transfer &
Trust Company, as Rights Agent (the "Rights Agent"),
W I T N E S S E T H
WHEREAS, on September 19, 1996 the Board of Directors of the Company
authorized and declared a dividend of one common stock purchase right (a
"Right") for each share of Common Stock (as hereinafter defined) outstanding
at the close of business on October 4, 1996 (the "Record Date") and has
authorized the issuance, upon the terms and subject to the conditions
hereinafter set forth, of one Right in respect of each share of Common Stock
issued after the Record Date, each Right initially representing the right to
purchase, upon the terms and subject to the conditions hereinafter set forth,
one-tenth of a share (each such one-tenth of a share being a "Unit") of Common
Stock;
NOW, THEREFORE, the parties hereto agree as follows:
Section 1. Definitions. The following terms, as used herein, have
the following meanings:
"Acquiring Person" means any Person who, together with all Affiliates
and Associates of such Person, shall be the Beneficial Owner of 15% or more of
the shares of Common Stock then outstanding, but shall not include the
Company, any of its Subsidiaries, any employee benefit plan of the Company or
any of its Subsidiaries or any Person organized, appointed or established by
the Company or any of its Subsidiaries for or pursuant to the terms of any
such plan.
"Adjusted Purchase Price" has the meaning set forth in Section
11(a)(ii).
"Adjustment Shares" has the meaning set forth in Section 11(a)(ii).
"Affiliate" and "Associate" have the respective meanings ascribed to
such terms in Rule 12b-2 under the Exchange Act as in effect on the date
hereof.
A Person shall be deemed the "Beneficial Owner" of, and shall be
deemed to "beneficially own", any securities:
(a) which such Person or any of its Affiliates or Associates,
directly or indirectly, beneficially owns (as determined pursuant to
Rule 13d-3 under the Exchange Act as in effect on the date hereof);
(b) which such Person or any of its Affiliates or Associates,
directly or indirectly, has
(i) the right to acquire (whether such right is
exercisable immediately or only upon the occurrence of certain
events or the passage of time or both) pursuant to any
agreement, arrangement or understanding (whether or not in
writing) or otherwise (other than pursuant to the Rights);
provided that a Person shall not be deemed the "Beneficial
Owner" of or to "beneficially own" securities tendered pursuant
to a tender or exchange offer made by or on behalf of such
Person or any of its Affiliates or Associates until such
tendered securities are accepted for payment or exchange; or
(ii) the right to vote (whether such right is exercisable
immediately or only upon the occurrence of certain events or the
passage of time or both) pursuant to any agreement, arrangement
or understanding (whether or not in writing) or otherwise;
provided that a Person shall not be deemed the "Beneficial
Owner" of or to "beneficially own" any security under this
clause (ii) as a result of an agreement, arrangement or
understanding to vote such security if such agreement,
arrangement or understanding (A) arises solely from a revocable
proxy or consent given 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 (B)
is not also then reportable by such Person on Schedule 13D
under the Exchange Act (or any comparable or successor report);
or
(c) which are beneficially owned, directly or indirectly, by
any other Person (or any Affiliate or Associate thereof) with which
such Person or any of its Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing) for the
purpose of acquiring, holding, voting (except pursuant to a revocable
proxy as described in subparagraph (b)(ii) immediately above) or
disposing of any such securities.
"Business Day" means any day other than a Saturday, Sunday or a day on
which banking institutions in the State of New York are authorized or
obligated by law or executive order to close.
"Close of business" on any given date means 5:00 P.M., New York City
time, on such date; provided that if such date is not a Business Day "close of
business" means 5:00 P.M., New York City time, on the next succeeding Business
Day.
"Common Stock" means the Common Stock, par value $3.33 per share, of
the Company, except that, when used with reference to any Person other than the
Company, "Common Stock" means the capital stock of such Person with the
greatest voting power, or the equity securities or other equity interest
having power to control or direct the management, of such Person.
"Common Stock Equivalents" has the meaning set forth in Section
11(a)(iii).
"Continuing Director" means any member of the Board of Directors of
the Company, while such Person is a member of the Board, who is not an
Acquiring Person or an Affiliate or Associate of an Acquiring Person or a
representative or nominee of an Acquiring Person or of any such Affiliate or
Associate and either (a) was a member of the Board immediately prior to the
time any Person becomes an Acquiring Person or (b) subsequently becomes a
member of the Board, if such Person's nomination for election or election to
the Board is recommended or approved by a majority of the Continuing Directors.
"Distribution Date" means the earlier of (a) the close of business on
the tenth day (or such later day as may be designated by action of a majority
of the Continuing Directors) after the Stock Acquisition Date and (b) the
close of business on the tenth Business Day (or such later day as may be
designated by action of a majority of the Continuing Directors) after the date
of the commencement of a tender or exchange offer by any Person if, upon
consummation thereof, such Person would be an Acquiring Person.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Expiration Date" means the earlier of (a) the Final Expiration Date
and (b) the time at which all Rights are redeemed as provided in Section 23 or
exchanged as provided in Section 24.
"Final Expiration Date" means the close of business on October 4,
2006.
"Person" means an individual, corporation, partnership, association,
trust or any other entity or organization.
"Principal Party" has the meaning set forth in Section 13(b).
"Purchase Price" means the price (subject to adjustment as provided
herein) at which a holder of a Right may purchase one Unit of Common Stock
(subject to adjustment as provided herein) upon exercise of a Right, which
price shall initially be $6.00.
"Right" has the meaning set forth in the Whereas Clause.
"Right Certificate" has the meaning set forth in Section 4(a).
"Section 11(a)(ii) Event" means any event described in the first
clause of Section 11(a)(ii).
"Section 13 Event" means any event described in clauses (x), (y) or
(z) of Section 13(a).
"Securities Act" means the Securities Act of 1933, as amended.
"Stock Acquisition Date" means the date of the first public
announcement (including the filing of a report on Schedule 13D under the
Exchange Act (or any comparable or successor report)) by the Company or an
Acquiring Person indicating that an Acquiring Person has become such.
"Subsidiary" of any Person means any other Person of which securities
or other ownership interests having ordinary voting power, in the absence of
contingencies, to elect a majority of the board of directors or other Persons
performing similar functions are at the time directly or indirectly owned by
such first Person.
"Substitution Period" has the meaning as set forth in Section
11(a)(iii).
"Trading Day" means a day on which the principal national securities
exchange on which the shares of Common Stock are listed or admitted to trading
is open for the transaction of business or, if the shares of Common Stock are
not listed or admitted to trading on any national securities exchange, a
Business Day.
"Triggering Event" means any Section 11(a)(ii) Event or any Section 13
Event.
"Unit" has the meaning set forth in the Whereas Clause.
Section 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company and the holders of
the Rights in accordance with the terms and conditions hereof, and the Rights
Agent hereby accepts such appointment. The Company may from time to time
appoint such Co-Rights Agents as it may deem necessary or desirable. If the
Company appoints one or more Co-Rights Agents, the respective duties of the
Rights Agent and any Co-Rights Agents shall be as the Company shall determine.
Section 3. Issue of Right Certificates. (a) Prior to the
Distribution Date, (i) the Rights will be evidenced by the certificates for
the Common Stock and not by separate Right Certificates (as hereinafter
defined) and the registered holders of the Common Stock shall be deemed to be
the registered holders of the associated Rights, and (ii) the Rights will be
transferable only in connection with the transfer of the underlying shares of
Common Stock. As soon as practicable after the Record Date, the Company will
send a summary of the Rights substantially in the form of Exhibit B hereto, by
first-class, postage prepaid mail, to each record holder of the Common Stock
as of the close of business on the Record Date at the address of such holder
shown on the records of the Company.
(b) As soon as practicable after the Company has notified the
Rights Agent of the occurrence of the Distribution Date, the Rights Agent will
send, by first-class, insured, postage prepaid mail, to each record holder of
the Common Stock as of the close of business on the Distribution Date, at the
address of such holder shown on the records of the Company, one or more Right
Certificates evidencing one Right (subject to adjustment as provided herein)
for each share of Common Stock so held. If an adjustment in the number of
Rights per share of Common Stock has been made pursuant to Section 11(p), the
Company shall, at the time of distribution of the Right Certificates, make the
necessary and appropriate rounding adjustments (in accordance with Section
14(a)) so that Right Certificates representing only whole numbers of Rights
are distributed and cash is paid in lieu of any fractional Rights. From and
after the Distribution Date, the Rights will be evidenced solely by such Right
Certificates.
(c) Rights shall be issued in respect of all shares of Common
Stock outstanding as of the Record Date or issued (on original issuance or out
of treasury) after the Record Date but prior to the earlier of the
Distribution Date and the Expiration Date. In addition, in connection with
the issuance or sale of shares of Common Stock following the Distribution Date
and prior to the Expiration Date, the Company (i) shall, with respect to
shares of Common Stock so issued or sold (x) pursuant to the exercise of stock
options or under any employee plan or arrangement or (y) upon the exercise,
conversion or exchange of other securities issued by the Company prior to the
Distribution Date and (ii) 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 that no such Right Certificate shall be issued if, and to the
extent that, (i) 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 or (ii)
appropriate adjustment shall otherwise have been made in lieu of the issuance
thereof.
(d) Certificates for the Common Stock issued after the Record
Date but prior to the earlier of the Distribution Date and the Expiration Date
shall have impressed on, printed on, written on or otherwise affixed to them
the following legend:
This certificate also evidences certain Rights as set forth in a
Rights Agreement between Village Bancorp, Inc. and American Stock
Transfer & Trust Company dated as of September 19, 1996 (the "Rights
Agreement"), the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal executive
offices of the Company. The Company will mail to the holder of this
certificate a copy of the Rights Agreement without charge promptly
after receipt of a written request therefor. Under certain
circumstances, as set forth in the Rights Agreement, such Rights may
be evidenced by separate certificates and no longer be evidenced by
this certificate, may be redeemed or exchanged or may expire. As set
forth in the Rights Agreement, Rights issued to, or held by, any
Person who is, was or becomes an Acquiring Person or an Affiliate or
Associate thereof (as such terms are defined in the Rights
Agreement), whether currently held by or on behalf of such Person or
by any subsequent holder, may be null and void.
Section 4. Form of Right Certificates. (a) The certificates
evidencing the Rights (and the forms of assignment, election to purchase and
certificates to be printed on the reverse thereof) (the "Right Certificates")
shall be substantially in the form of Exhibit A hereto and may have such marks
of identification or designation and such legends, summaries or endorsements
printed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law, rule or regulation or with any rule or
regulation of any stock exchange on which the Rights may from time to time be
listed, or to conform to usage. The Right Certificates, whenever distributed,
shall be dated as of the Record Date.
(b) Any Right Certificate representing Rights beneficially
owned by any Person referred to in clauses (i), (ii) or (iii) of the first
sentence of Section 7(d) shall (to the extent feasible) contain the following
legend:
The Rights represented by this Right Certificate are or were
beneficially owned by a Person who was or became an Acquiring Person
or an Affiliate or Associate of an Acquiring Person (as such terms
are defined in the Rights Agreement). This Right Certificate and the
Rights represented hereby may be or may become null and void in the
circumstances specified in Section 7(d) of such Agreement.
Section 5. Countersignature and Registration. (a) The Right
Certificates shall be executed on behalf of the Company by its Chairman of the
Board, its President or any Vice President, either manually or by facsimile
signature, and shall have affixed thereto the Company's seal or a facsimile
thereof which shall be attested by the Secretary or an Assistant Secretary of
the Company, either manually or by facsimile signature. The Right
Certificates shall be manually countersigned by the Rights Agent and shall not
be valid for any purpose unless so countersigned. In case any officer of the
Company whose manual or facsimile signature is affixed to the Right
Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Right Certificates may, nevertheless, be countersigned by the Rights
Agent and issued and delivered with the same force and effect as though the
Person who signed such Right Certificates had not ceased to be such officer of
the Company. Any Right Certificate may be signed on behalf of the Company by
any Person who, at the actual date of the execution of such Right Certificate,
shall be a proper officer of the Company to sign such Right Certificate,
although at the date of the execution of this Rights Agreement any such Person
was not such an officer.
(b) Following the Distribution Date, the Rights Agent will
keep or cause to be kept, at its principal office or offices designated as the
place for surrender of Right Certificates upon exercise, transfer or exchange,
books for registration and transfer of the Right Certificates. Such books
shall show with respect to each Right Certificate the name and address of the
registered holder thereof, the number of Rights indicated on the certificate
and the certificate number.
Section 6. Transfer and Exchange of Right Certificates; Mutilated,
Destroyed, Lost or Stolen Right Certificates. (a) At any time after the
Distribution Date and prior to the Expiration Date, any Right Certificate or
Certificates may, upon the terms and subject to the conditions set forth below
in this Section 6(a), be transferred or exchanged for another Right
Certificate or Certificates evidencing a like number of Rights as the Right
Certificate or Certificates surrendered. Any registered holder desiring to
transfer or exchange any Right Certificate or Certificates shall surrender
such Right Certificate or Certificates (with, in the case of a transfer, the
form of assignment and certificate on the reverse side thereof duly executed)
to the Rights Agent at the principal office or offices of the Rights Agent
designated for such purpose. Neither the Rights Agent nor the Company shall
be obligated to take any action whatsoever with respect to the transfer of any
such surrendered Right Certificate or Certificates until the registered holder
of the Rights has complied with the requirements of Section 7(e). Upon
satisfaction of the foregoing requirements, the Rights Agent shall, subject to
Sections 4(b), 7(d), 14 and 24, countersign and deliver to the Person entitled
thereto a Right Certificate or Certificates as so requested. The Company may
require payment of a sum sufficient to cover any transfer tax or other
governmental charge that may be imposed in connection with any transfer or
exchange of any Right Certificate or Certificates.
(b) Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of loss, theft or destruction,
of indemnity or security reasonably satisfactory to them, and, at the
Company's request, reimbursement to the Company and the Rights Agent of all
reasonable expenses incidental thereto, and upon surrender to the Rights Agent
and cancellation of the Right Certificate if mutilated, the Company will issue
and deliver a new Right Certificate of like tenor to the Rights Agent for
countersignature and delivery to the registered owner in lieu of the Right
Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights. (a) The registered holder of any Right Certificate may exercise the
Rights evidenced thereby (except as otherwise provided herein, including
Sections 7(d) and (e), 9(c), 11(a) and 24) in whole or in part at any time
after the Distribution Date and prior to the Expiration Date upon surrender of
the Right Certificate, with the form of election to purchase and the
certificate on the reverse side thereof duly executed, to the Rights Agent at
the principal office or offices of the Rights Agent designated for such
purpose, together with payment (in lawful money of the United States of
America by certified check or bank draft payable to the order of the Company)
of the aggregate Purchase Price with respect to the Rights then to be
exercised and an amount equal to any applicable transfer tax or other
governmental charge.
(b) Upon satisfaction of the requirements of Section 7(a) and
subject to Section 20(k), the Rights Agent shall thereupon promptly (i)(A)
requisition from any transfer agent of the Common Stock (or make available, if
the Rights Agent is the transfer agent therefor) certificates for the total
number of Units of Common Stock 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 shares of Common Stock
issuable upon exercise of the Rights with a depositary agent, requisition from
the depositary agent depositary receipts representing such number of Units of
Common Stock as are to be purchased (in which case certificates for the shares
of Common Stock represented by such receipts shall be deposited by the
transfer agent with the depositary agent) and the Company will direct the
depositary agent to comply with such request, (ii) requisition from the
Company the amount of cash, if any, to be paid in lieu of issuance of
fractional shares in accordance with Section 14 and (iii) after receipt of
such certificates or depositary receipts and cash, if any, cause the same to
be delivered to or upon the order of the registered holder of such Right
Certificate (with such certificates or receipts registered in such name or
names as may be designated by such holder). If the Company is obligated to
deliver other securities or assets pursuant to this Agreement, the Company
will make all arrangements necessary so that such other securities and assets
are available for delivery by the Rights Agent, if and when appropriate.
(c) In case the registered holder of any Right Certificate
shall exercise less than all the Rights evidenced thereby, a new Right
Certificate evidencing the number of Rights remaining unexercised shall be
issued by the Rights Agent and 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, subject to the provisions of Section 14.
(d) Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of a Section 11(a)(ii) Event,
any Rights beneficially owned by (i) an Acquiring Person or an Associate or
Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee after the
Acquiring Person becomes such or (iii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for consideration) from the
Acquiring Person (or any such Associate or Affiliate) to holders of equity
interests in such Acquiring Person (or in any such Associate or Affiliate) or
to any Person with whom the Acquiring Person (or any such Associate or
Affiliate) has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer which the Continuing
Directors have determined is part of a plan, arrangement or understanding
which has as a primary purpose or effect the avoidance of this Section 7(d)
shall become null and void without any further action, and no holder of such
Rights shall have any rights whatsoever with respect to such Rights, whether
under any provision of this Agreement or otherwise. The Company shall use all
reasonable efforts to insure that the provisions of this Section 7(d) and
Section 4(b) are complied with, but shall have no liability to any holder of
Right Certificates or other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or its Affiliates and
Associates or any transferee of any of them hereunder.
(e) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder of Rights upon the occurrence of
any purported transfer pursuant to Section 6 or exercise pursuant to this
Section 7 unless such registered holder (i) shall have completed and signed
the certificate contained in the form of assignment or election to purchase,
as the case may be, set forth on the reverse side of the Right Certificate
surrendered for such transfer or exercise, as the case may be, (ii) shall not
have indicated an affirmative response to clause 1 or 2 thereof and (iii)
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.
Section 8. Cancellation and Destruction of Right Certificates. All
Right Certificates surrendered for exercise, transfer or exchange shall, if
surrendered to the Company or to any of its agents, be delivered to the Rights
Agent for cancellation or in cancelled form, or, if surrendered to the Rights
Agent, shall be cancelled by it, and no Right Certificates shall be issued in
lieu thereof except as expressly permitted by this Agreement. The Company
shall deliver to the Rights Agent for cancellation, and the Rights Agent shall
cancel, any other Right Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall deliver all
cancelled Right Certificates to the Company, or shall, at the written request
of the Company, destroy such cancelled Right Certificates, and in such case
shall deliver a certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Capital Stock. (a) The
Company covenants and agrees that it will cause to be reserved and kept
available a number of shares of Common Stock which are authorized but not
outstanding or otherwise reserved for issuance sufficient to permit the
exercise in full of all outstanding Rights as provided in this Agreement.
(b) So long as the Common Stock issuable upon the exercise of
Rights may be listed on any national securities exchange, the Company shall
use its best efforts to cause, from and after such time as the Rights become
exercisable, all securities reserved for such issuance to be listed on any
such exchange upon official notice of issuance upon such exercise.
(c) The Company shall use its best efforts (i) to file, as
soon as practicable following the earliest date after the occurrence of a
Section 11(a)(ii) Event as of which the consideration to be delivered by the
Company upon exercise of the Rights has been determined in accordance with
Section 11(a)(iii), or as soon as is required by law following the
Distribution Date, as the case may be, a registration statement under the
Securities Act with respect to the securities issuable upon exercise of the
Rights, (ii) to cause such registration statement to become effective as soon
as practicable after such filing and (iii) to cause such registration
statement to remain effective (with a prospectus at all times meeting the
requirements of the Securities Act) until the earlier of (A) the date as of
which the Rights are no longer exercisable for such securities and (B) the
Expiration Date. The Company will also take such action as may be appropriate
under, or to ensure compliance with, the securities or blue sky laws of the
various states in connection with the exercisability of the Rights. The
Company may temporarily suspend, for a period of time not to exceed 90 days
after the date set forth in clause (i) of the first sentence of this Section
9(c), the exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective. Upon any such
suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as well as a
public announcement at such time as the suspension is no longer in effect.
Notwithstanding any such provision of this Agreement to the contrary, the
Rights shall not be exercisable for securities in any jurisdiction if the
requisite qualification in such jurisdiction shall not have been obtained,
such exercise therefor shall not be permitted under applicable law or a
registration statement in respect of such securities shall not have been
declared effective.
(d) The Company covenants and agrees that it will take all
such action as may be necessary to insure that all Units of Common Stock
issuable upon exercise of Rights shall, at the time of delivery of the
certificates for such securities (subject to payment of the Purchase Price),
be duly and validly authorized and issued and fully paid and nonassessable.
(e) The Company further covenants and agrees that it will pay
when due and payable any and all federal and state transfer taxes and other
governmental charges which may be payable in respect of the issuance or
delivery of the Right Certificates and of any certificates for Common Stock
upon the exercise of Rights. The Company shall not, however, be required to
pay any transfer tax or other governmental charge which may be payable in
respect of any transfer involved in the issuance or delivery of any Right
Certificates or of any certificates for Common Stock to a Person other than
the registered holder of the applicable Right Certificate, and prior to any
such transfer, issuance or delivery any such tax or other governmental charge
shall have been paid by the holder of such Right Certificate or it shall have
been established to the Company's satisfaction that no such tax or other
governmental charge is due.
Section 10. Common Stock Record Date. Each Person (other than the
Company) in whose name any certificate for Common Stock is issued upon the
exercise of Rights shall for all purposes be deemed to have become the holder
of record of such Common Stock represented thereby on, and such certificate
shall be dated, the date upon which the Right Certificate evidencing such
Rights was duly surrendered and payment of the Purchase Price (and any
transfer taxes or other governmental charges) was made; provided that if the
date of such surrender and payment is a date upon which the transfer books of
the Company relating to the Common Stock are closed, such Person shall be
deemed to have become the record holder of such shares on, and such
certificate shall be dated, the next succeeding Business Day on which the
applicable transfer books of the Company are open. Prior to the exercise of
the Rights evidenced thereby, the holder of a Right Certificate shall not be
entitled to any rights of a stockholder of the Company with respect to shares
for which the Rights shall be exercisable, including the right to vote, to
receive dividends or other distributions or to exercise any preemptive rights,
and shall not be entitled to receive any notice of any proceedings of the
Company except as provided herein.
Section 11. Adjustment of Purchase Price, Number and Kind of Shares
or Number of Rights. (a) (i) If the Company shall at any time after the date
of this Agreement (A) pay a dividend on the Common Stock payable in shares of
Common Stock, (B) subdivide the outstanding Common Stock into a greater number
of shares, (C) combine the outstanding Common Stock into a smaller number of
shares or (D) issue any shares of its capital stock in a reclassification of
the Common Stock (including any such reclassification in connection with a
consolidation or merger involving the Company), the Purchase Price in effect
immediately prior to the record date for such dividend or of the effective
date of such subdivision, combination or reclassification, and the number and
kind of shares of Common Stock or other capital stock issuable on such date
shall be proportionately adjusted so that each holder of a Right shall (except
as otherwise provided herein, including Section 7(d)) thereafter be entitled
to receive, upon exercise thereof at the Purchase Price in effect immediately
prior to such date, the aggregate number and kind of shares of Common Stock or
other capital stock, as the case may be, which, if such Right had been
exercised immediately prior to such date and at a time when the applicable
transfer books of the Company were open, such holder would have been entitled
to receive upon such exercise and by virtue of such dividend, subdivision,
combination or reclassification. If an event occurs which requires an
adjustment under both this Section 11(a)(i) and Section 11(a)(ii), the
adjustment provided for in this Section 11(a)(i) shall be in addition to, and
shall be made prior to, any adjustment required pursuant to Section 11(a)(ii).
(ii) If any Person, alone or together with its Affiliates and
Associates, shall, at any time after the date of this Agreement, become an
Acquiring Person, then proper provision shall promptly be made so that each
holder of a Right shall (except as otherwise provided herein, including
Section 7(d)) thereafter be entitled to receive, upon exercise thereof at a
purchase price equal to ten times the Purchase Price in effect immediately
prior to the first occurrence of a Section 11(a)(ii) Event (the "Adjusted
Purchase Price"), in lieu of the number of Units of Common Stock for which a
Right was exercisable immediately prior to the first occurrence of a Section
11(a)(ii) Event, such number of duly authorized, validly issued, fully paid and
nonassessable shares of Common Stock of the Company (such shares being
referred to herein as the "Adjustment Shares") as shall be equal to the result
obtained by dividing
(x) the product obtained by multiplying the Adjusted Purchase
Price by the number of Units of Common Stock for which a Right was
exerciseable immediately prior to such first occurrence by
(y) 50% of the current market price (determined pursuant to
Section 11(d)(i)) per share of Common Stock on the date of such first
occurrence;
provided that if the transaction that would otherwise give rise to the
foregoing adjustment is also subject to the provisions of Section 13, then
only the provisions of Section 13 shall apply and no adjustment shall be made
pursuant to this Section 11(a)(ii).
(iii) If the number of shares of Common Stock which are
authorized by the Company's certificate of incorporation but not outstanding
or reserved for issuance other than upon exercise of the Rights is not
sufficient to permit the exercise in full of the Rights in accordance with
Section 11(a)(ii), the Company shall, with respect to each Right, make
adequate provision to substitute for the Adjustment Shares, upon payment of
the Adjusted Purchase Price then in effect, (A) (to the extent available)
Common Stock and then, (B) (to the extent available) other equity securities
of the Company which a majority of the Continuing Directors has determined to
be essentially equivalent to shares of Common Stock in respect to dividend,
liquidation and voting rights (such securities being referred to herein as
"Common Stock Equivalents") and then, if necessary, (C) other equity or debt
securities of the Company, cash or other assets, a reduction in the Adjusted
Purchase Price or any combination of the foregoing, having an aggregate value
(as determined by the Continuing Directors based upon the advice of a
nationally recognized investment banking firm selected by the Continuing
Directors) equal to the value of the Adjustment Shares; provided that (x) the
Company may, and (y) if the Company shall not have made adequate provision as
required above to deliver value within 30 days following the later of the
first occurrence of a Section 11(a)(ii) Event and the first date that the
right to redeem the Rights pursuant to Section 23 shall expire, then the
Company shall be obligated to, deliver, upon the surrender for exercise of a
Right and without requiring payment of the Adjusted Purchase Price, (1) (to
the extent available) Common Stock and then (2) (to the extent available)
Common Stock Equivalents and then, if necessary, (3) other equity or debt
securities of the Company, cash or other assets or any combination of the
foregoing, having an aggregate value (as determined by the Continuing
Directors based upon the advice of a nationally recognized investment banking
firm selected by the Continuing Directors) equal to the excess of the value of
the Adjustment Shares over the Adjusted Purchase Price. If the Continuing
Directors of the Company shall determine in good faith that it is likely that
sufficient additional shares of Common Stock could be authorized for issuance
upon exercise in full of the Rights, the 30 day period set forth above (such
period, as it may be extended, being referred to herein as the "Substitution
Period") may be extended to the extent necessary, but not more than 90 days
following the first occurrence of a Section 11(a)(ii) Event, in order that the
Company may seek stockholder approval for the authorization of such additional
shares. To the extent that the Company determines that some action is to be
taken pursuant to the first and/or second sentence of this Section 11(a)(iii),
the Company (X) shall provide, subject to Section 7(d), that such action shall
apply uniformly to all outstanding Rights and (Y) may suspend the
exercisability of the Rights until the expiration of the Substitution Period
in order to seek any authorization of additional shares and/or to decide the
appropriate form and value of any consideration to be delivered as referred
to in such first and/or second sentence. If any such suspension occurs, the
Company shall issue a public announcement stating that the exercisability of
the Rights has been temporarily suspended, as well as a public announcement at
such time as the suspension is no longer in effect. For purposes of this
Section 11(a)(iii), the value of the Common Stock shall be the current market
price per share of Common Stock (as determined pursuant to Section 11(d)) on
the later of the date of the first occurrence of a Section 11(a)(ii) Event and
the first date that the right to redeem the Rights pursuant to Section 23
shall expire; any Common Stock Equivalent shall be deemed to have the same
value as the Common Stock on such date; and the value of other securities or
assets shall be determined pursuant to Section 11(d)(iii).
(b) In case the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of Common Stock
entitling them to subscribe for or purchase (for a period expiring within 45
calendar days after such record date) Common Stock (or Common Stock
Equivalents) or securities convertible into or exercisable for Common Stock
(or Common Stock Equivalents) at a price per share of Common Stock (or Common
Stock Equivalents) (in each case, taking account of any conversion or exercise
price) less than the current market price (as determined pursuant to Section
11(d)) per share of Common Stock on such record date, the Purchase Price to be
in effect after such record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such date by a fraction, the
numerator of which shall be the number of shares of Common Stock outstanding
on such record date, plus the number of shares of Common Stock which the
aggregate price (taking account of any conversion or exercise price) of the
total number of shares of Common Stock (and/or Common Stock Equivalents) so to
be offered would purchase at such current market price and the denominator of
which shall be the number of shares of Common Stock outstanding on such record
date plus the number of additional shares of Common Stock (and/or Common Stock
Equivalents) so to be offered. In case such subscription price may be paid by
delivery of consideration part or all of which shall be in a form other than
cash, the value of such consideration shall be as determined in good faith by
the Board of Directors of the Company, whose determination shall be described
in a statement filed with the Rights Agent and shall be conclusive for all
purposes. Shares of Common Stock owned by or held for the account of the
Company shall not be deemed outstanding for the purpose of any such
computation. Such adjustment shall be made successively whenever such a
record date is fixed, and if such rights, options or warrants are not so
issued, the Purchase Price shall be adjusted to be the Purchase Price which
would then be in effect if such record date had not been fixed.
(c) In case the Company shall fix a record date for the making
of a distribution to all holders of Common Stock (including any such
distribution made in connection with a consolidation or merger involving the
Company) of evidences of indebtedness, equity securities other than Common
Stock, assets (other than a regular periodic cash dividend out of the earnings
or retained earnings of the Company) or rights, options or warrants (excluding
those referred to in Section 11(b)), the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price in
effect immediately prior to such record date by a fraction, the numerator of
which shall be the current market price (as determined pursuant to Section
11(d)) per share of Common Stock on such record date, less the value (as
determined pursuant to Section 11(d)(iii)) of such evidences of indebtedness,
equity securities, assets, rights, options or warrants so to be distributed
with respect to one share of Common Stock and the denominator of which shall
be such current market price per share of Common Stock. Such adjustment shall
be made successively whenever such a record date is fixed, and if such
distribution is not so made, the Purchase Price shall be adjusted to be the
Purchase Price which would then be in effect if such record date had not been
fixed.
(d) (i) For the purpose of any computation hereunder other than
computations made pursuant to Section 11(a)(iii) or 14, the "current market
price" per share of Common Stock on any date shall be deemed to be the average
of the daily closing prices per share of such Common Stock for the 30
consecutive Trading Days immediately prior to such date; for purposes of
computations made pursuant to Section 11(a)(iii), the "current market price"
per share of Common Stock on any date shall be deemed to be the average of the
daily closing prices per share of such Common Stock for the 10 consecutive
Trading Days immediately following such date; and for purposes of computations
made pursuant to Section 14, the "current market price" per share of Common
Stock for any Trading Day shall be deemed to be the closing price per share of
Common Stock for such Trading Day; provided that if the current market price
per share of the Common Stock is determined during a period following the
announcement by the issuer of such Common Stock of (A) a dividend or
distribution on such Common Stock payable in shares of such Common Stock or
securities exercisable for or convertible into shares of such Common Stock
(other than the Rights), or (B) any subdivision, combination or
reclassification of such Common Stock, and prior to the expiration of the
requisite 30 Trading Day or 10 Trading Day period, as set forth above, after
the ex-dividend date for such dividend or distribution, or the record date for
such subdivision, combination or reclassification, then, and in each such
case, the "current market price" shall be properly adjusted to take into
account ex-dividend trading. The closing price for each day shall be the last
sale price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with
respect to securities listed or admitted to trading on the New York Stock
Exchange or, if the shares of Common Stock are not listed or admitted to
trading on the New York Stock Exchange, on the principal national securities
exchange on which the shares of Common Stock are listed or admitted to trading
or, if the shares of Common Stock are not listed or admitted to trading on any
national securities exchange, the last quoted price or, if not so quoted, the
average of the high bid and low asked prices in the over-the-counter market, as
reported by the National Association of Securities Dealers, Inc. Automated
Quotation System ("NASDAQ") or such other system then in use or, if on any
such date the shares of Common Stock are not quoted by any such organization,
the average of the closing bid and asked prices as furnished by a professional
market maker making a market in the Common Stock selected by the Board of
Directors of the Company, or, if at the time of such selection there is an
Acquiring Person, by a majority of the Continuing Directors. If on any such
date no market maker is making a market in the Common Stock, the fair value of
such shares on such date as determined in good faith by the Board of Directors
of the Company (or, if at the time of such determination there is an Acquiring
Person, by a majority of the Continuing Directors) shall be used. If the
Common Stock is not publicly held or not so listed or traded, the "current
market price" per share means the fair value per share as determined in good
faith by the Board of Directors of the Company, or, if at the time of such
determination there is an Acquiring Person, by a majority of the Continuing
Directors, or if there are no Continuing Directors, by a nationally recognized
investment banking firm selected by the Board of Directors, which
determination shall be described in a statement filed with the Rights Agent
and shall be conclusive for all purposes.
(ii) For the purpose of any computation hereunder, the
"current market price" per Unit of Common Stock shall be an amount equal to
the current market price per share of Common Stock (as determined pursuant to
Section 11(d)(i))divided by ten.
(iii) For the purpose of any computation hereunder, the value
of any securities or assets other than Common Stock shall be the fair value as
determined in good faith by the Board of Directors of the Company, or, if at
the time of such determination there is an Acquiring Person, by a majority of
the Continuing Directors then in office, or, if there are no Continuing
Directors, by a nationally recognized investment banking firm selected by the
Board of Directors, which determination shall be described in a statement
filed with the Rights Agent and shall be conclusive for all purposes.
(e) Anything herein to the contrary notwithstanding, no
adjustment in the Purchase Price shall be required unless such adjustment
would require an increase or decrease of at least 1% in the Purchase Price;
provided that any adjustments which by reason of this Section 11(e) are not
required to be made shall be carried forward and taken into account in any
subsequent adjustment. All calculations under this Section 11 shall be made
to the nearest cent or to the nearest ten-thousandth of a share of Common
Stock.
(f) If at any time, as a result of an adjustment made pursuant
to Section 11(a)(ii) or Section 13(a), the holder of any Right shall be
entitled to receive upon exercise of such Right any shares of capital stock
other than Common Stock, thereafter the number of such other shares so
receivable upon exercise of any Right and the Purchase Price thereof shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the Common Stock
contained in Section 11(a), (b), (c), (e), (g), (h), (i), (j), (k) and (m),
and the provisions of Sections 7, 9, 10, 13 and 14 with respect to the Common
Stock shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to
any adjustment made hereunder shall evidence the right to purchase, at the
Purchase Price then in effect, the then applicable number of Units of Common
Stock and other capital stock of the Company issuable from time to time
hereunder upon exercise of the Rights, all subject to further adjustment as
provided herein.
(h) Unless the Company shall have exercised its election as
provided in Section 11(i), upon each adjustment of the Purchase Price as a
result of the calculations made in Section 11(b) and (c), each Right
outstanding immediately prior to the making of such adjustment shall
thereafter evidence the right to purchase, at the adjusted Purchase Price,
that number of Units of Common Stock (calculated to the nearest one-millionth)
obtained by (i) multiplying (x) the number of Units of Common Stock for which
a Right was exercisable immediately prior to this adjustment by (y) the
Purchase Price in effect immediately prior to such adjustment of the Purchase
Price and (ii) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights, in lieu of
any adjustment in the number of Units of Common Stock issuable upon the
exercise of a Right. Each of the Rights outstanding after such adjustment of
the number of Rights shall be exercisable for the number of Units of Common
Stock for which such Right was exercisable immediately prior to such
adjustment. Each Right held of record prior to such adjustment of the number
of Rights shall become that number of Rights (calculated to the nearest
ten-thousandth) obtained by dividing the Purchase Price in effect immediately
prior to adjustment of the Purchase Price by the Purchase Price in effect
immediately after adjustment of the Purchase Price. The Company shall make
a public announcement of its election to adjust the number of Rights,
indicating the record date for the adjustment, and, if known at the time, the
amount of the adjustment to be made. This record date may be the date on
which the Purchase Price is adjusted or any day thereafter, but, if the Right
Certificates have been issued, shall be at least 10 days later than the date
of the public announcement. If Right Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section 11(i), the Company
shall, as promptly as practicable, cause to be distributed to holders of
record of Right Certificates on such record date Right Certificates
evidencing, subject to Section 14, the additional Rights to which such holders
shall be entitled as a result of such adjustment, or, at the option of the
Company, shall cause to be distributed to such holders of record in
substitution and replacement for the Right Certificates held by such holders
prior to the date of adjustment, and upon surrender thereof, if required by
the Company, new Right Certificates evidencing all the Rights to which such
holders shall be entitled after such adjustment. Right Certificates so to be
distributed shall be issued, executed and countersigned in the manner provided
for herein (and may bear, at the option of the Company, the adjusted Purchase
Price) and shall be registered in the names of the holders of record of Right
Certificates on the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase
Price or the number of Units of Common Stock issuable upon the exercise of the
Rights, the Right Certificates theretofore and thereafter issued may continue
to express the Purchase Price per Unit of Common Stock and the number of
shares which were expressed in the initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an adjustment
reducing the Purchase Price below the par value, if any, of the number of
Units of Common Stock issuable upon exercise of the Rights, the Company shall
take any corporate action which may, in the opinion of its counsel, be
necessary in order that the Company may validly and legally issue fully paid
and nonassessable such number of Units of Common Stock at such adjusted
Purchase Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuance to the holder of any Right exercised after such record date
the number of Units of Common Stock or other capital stock of the Company, if
any, issuable upon such exercise over and above the number of Units of Common
Stock or other capital stock of the Company, if any, issuable upon such
exercise on the basis of the Purchase Price in effect prior to such
adjustment; provided that the Company shall deliver to such holder a due bill
or other appropriate instrument evidencing such holder's right to receive such
additional shares upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such reductions in the
Purchase Price, in addition to those adjustments expressly required by this
Section 11, as and to the extent that it, in its sole discretion, shall
determine to be advisable in order that any consolidation or subdivision of
the Common Stock, issuance wholly for cash of any Common Stock at less than
the current market price, issuance wholly for cash of Common Stock or
securities which by their terms are convertible into or exercisable for Common
Stock, stock dividends or issuance of rights, options or warrants referred to
in this Section 11, hereafter made by the Company to the holders of its Common
Stock, shall not be taxable to such stockholders.
(n) The Company covenants and agrees that it will not at any
time after the Distribution Date (i) consolidate, merge or otherwise combine
with or (ii) sell or otherwise transfer (and/or permit any of its Subsidiaries
to sell or otherwise transfer), in one transaction or a series of related
transactions, assets or earning power aggregating more than 50% of the assets
or earning power of the Company and its Subsidiaries, taken as a whole, to any
other Person or Persons if (x) at the time of or immediately after such
consolidation, merger, combination or sale there are any rights, warrants or
other instruments or securities outstanding or any agreements or arrangements
in effect which would substantially diminish or otherwise eliminate the
benefits intended to be afforded by the Rights or (y) prior to, simultaneously
with or immediately after such consolidation, merger, combination or sale, the
stockholders of a Person who constitutes, or would constitute, the "Principal
Party" for the purposes of Section 13 shall have received a distribution of
Rights previously owned by such Person or any of its Affiliates and Associates.
(o) The Company covenants and agrees that after the
Distribution Date, it will not, except as permitted by Sections 23, 24 and 27,
take (or permit any Subsidiary to take) any action if at the time such action
is taken it is reasonably foreseeable that such action will substantially
diminish or otherwise eliminate the benefits intended to be afforded by the
Rights.
(p) Notwithstanding anything in this Agreement to the
contrary, if at any time after the date hereof and prior to the Distribution
Date the Company shall (i) pay a dividend on the outstanding shares of Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding Common
Stock into a larger number of shares or (iii) combine the outstanding Common
Stock into a smaller number of shares, the number of Rights associated with
each share of Common Stock then outstanding, or issued or delivered thereafter
as contemplated by Section 3(c), shall be proportionately adjusted so that the
number of Rights thereafter associated with each share of Common Stock
following any such event shall equal the result obtained by multiplying the
number of Rights associated with each share of Common Stock immediately prior
to such event by a fraction the numerator of which shall be the total number
of shares of Common Stock outstanding immediately prior to the occurrence of
the event and the denominator of which shall be the total number of shares of
Common Stock outstanding immediately following the occurrence of such event.
Section 12. Certificate of Adjusted Purchase Price or Number of
Shares. Whenever an adjustment is made as provided in Sections 11 and 13, the
Company shall (a) promptly prepare a certificate setting forth such adjustment
and a brief statement of the facts accounting for such adjustment, (b)
promptly file with the Rights Agent and with each transfer agent for the
Common Stock a copy of such certificate and (c) mail a brief summary thereof
to each holder of a Right Certificate (or, if prior to the Distribution Date,
to each holder of a certificate representing shares of Common Stock) in the
manner set forth in Section 26. The Rights Agent shall be fully protected in
relying on any such certificate and on any adjustment therein contained.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power. (a) If, following the Stock Acquisition Date, directly or
indirectly,
(x) the Company shall consolidate with, merge into, or
otherwise combine with, any other Person, and the Company shall not
be the continuing or surviving corporation of such consolidation,
merger or combination,
(y) any Person shall merge into, or otherwise combine with, the
Company, and the Company shall be the continuing or surviving
corporation of such merger or combination and, in connection with
such merger or combination, all or part of the outstanding shares of
Common Stock shall be changed into or exchanged for other stock or
securities of the Company or any other Person, cash or any other
property, or
(z) the Company and/or one or more of its Subsidiaries shall
sell or otherwise transfer, in one transaction or a series of related
transactions, assets or earning power aggregating more than 50% of
the assets or earning power of the Company and its Subsidiaries,
taken as a whole, to any other Person or Persons,
then, and in each such case, proper provision shall promptly be made so that
(1) each holder of a Right shall thereafter be entitled to
receive, upon exercise thereof at the Adjusted Purchase Price in effect
immediately prior to the first occurrence of any Triggering Event, such number
of duly authorized, validly issued, fully paid and nonassessable shares of
freely tradeable Common Stock of the Principal Party (as hereinafter defined),
not subject to any rights of call or first refusal, liens, encumbrances or
other claims, as shall be equal to the result obtained by dividing
(A) the product obtained by multiplying the Adjusted Purchase
Price by the number of Units of Common Stock for which a Right was
exercisable immediately prior to such first occurrence by
(B) 50% of the current market price (determined pursuant to
Section 11(d)(i)) per share of the Common Stock of such Principal
Party on the date of consummation of such consolidation, merger,
combination, sale or transfer;
(2) the Principal Party shall thereafter be liable for, and
shall assume, by virtue of such consolidation, merger, combination, sale or
transfer, all the obligations and duties of the Company pursuant to this
Agreement;
(3) the term "Company" shall thereafter be deemed to refer to
such Principal Party, it being specifically intended that the provisions of
Section 11 shall apply only to such Principal Party following the first
occurrence of a Section 13 Event; and
(4) such Principal Party shall take such steps (including the
authorization and reservation of a sufficient number of shares of its Common
Stock to permit exercise of all outstanding Rights in accordance with this
Section 13(a)) in connection with the consummation of any such transaction as
may be necessary to assure that the provisions hereof shall thereafter be
applicable, as nearly as reasonably may be, in relation to the shares of its
Common Stock thereafter deliverable upon the exercise of the Rights.
(b) "Principal Party" means
(i) in the case of any transaction described in Section
13(a)(x) or (y), the Person that is the issuer of any securities into
which shares of Common Stock of the Company are converted in such
merger, consolidation or combination, and if no securities are so
issued, the Person that survives or results from such merger,
consolidation or combination; and
(ii) in the case of any transaction described in Section
13(a)(z), the Person that is the party receiving the greatest portion
of the assets or earning power transferred pursuant to such
transaction or transactions;
provided that in any such case, (A) if the Common Stock of such Person is not
at such time and has not been continuously over the preceding 12-month period
registered under Section 12 of the Exchange Act, and such Person is a direct or
indirect Subsidiary of another Person the Common Stock of which is and has
been so registered, "Principal Party" shall refer to such other Person; and
(B) in case such Person is a Subsidiary, directly or indirectly, of more than
one Person, the Common Stocks of two or more of which are and have been so
registered, "Principal Party" shall refer to whichever of such Persons is the
issuer of the Common Stock having the greatest aggregate market value.
(c) The Company shall not consummate any such consolidation,
merger, combination, sale or transfer unless the Principal Party shall have a
sufficient number of authorized shares of its Common Stock which are not
outstanding or otherwise reserved for issuance to permit the exercise in full
of the Rights in accordance with this Section 13 and unless prior thereto the
Company and such Principal Party shall have executed and delivered to the
Rights Agent a supplemental agreement providing for the terms set forth in
Section 13(a) and (b) and providing that, as soon as practicable after the
date of any consolidation, merger, combination, sale or transfer mentioned in
Section 13(a), the Principal Party will
(i) prepare and file a registration statement under the
Securities Act with respect to the securities issuable upon exercise
of the Rights, and will use its best efforts to cause such
registration statement (A) to become effective as soon as practicable
after such filing and (B) to remain effective (with a prospectus at
all times meeting the requirements of the Securities Act) until the
Expiration Date and
(ii) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which
comply in all respects with the requirements for registration on Form
10 under the Exchange Act.
The provisions of this Section 13 shall similarly apply to successive mergers,
consolidations, combinations, sales or other transfers. If any Section 13
Event shall occur at any time after the occurrence of a Section 11(a)(ii)
Event, the Rights which have not theretofore been exercised shall thereafter
become exercisable in the manner described in Section 13(a).
Section 14. Fractional Rights and Fractional Shares. (a) The
Company shall not be required to issue fractions of Rights, except prior to
the Distribution Date as provided in Section 11(p), or to distribute Right
Certificates which evidence fractional Rights. In lieu of any such fractional
Rights, the Company shall pay to the registered holders of the Right
Certificates with regard to which such fractional Rights would otherwise be
issuable an amount in cash equal to the same fraction of the current market
price of a whole Right. For purposes of this Section 14(a), the current
market price of a whole Right shall be the closing price of a Right for the
Trading Day immediately prior to the date on which such fractional Rights
would otherwise have been issuable. The closing price of a Right for any day
shall be the last sale price, regular way, or, in case no such sale takes
place on such day, the average of the closing bid and asked prices, regular
way, in either case as reported in the principal consolidated transaction
reporting system with respect to securities listed or admitted to trading on
the New York Stock Exchange or, if the Rights are not listed or admitted to
trading on the New York Stock Exchange, on the principal national securities
exchange on which the Rights are listed or admitted to trading or, if the
Rights are not listed or admitted to trading on any national securities
exchange, the last quoted price, or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as reported by NASDAQ
or such other system then in use or, if on any such date the Rights are not
quoted by any such organization, the average of the closing bid and asked
prices as furnished by a professional market maker making a market in the
Rights selected by the Board of Directors of the Company, or, if at the time
of such selection there is an Acquiring Person, by a majority of the
Continuing Directors. If on any such date no such market maker is making a
market in the Rights, the current market price of the Rights on such date
shall be as determined in good faith by the Board of Directors of the Company,
or, if at the time of such determination there is an Acquiring Person, by a
majority of the Continuing Directors.
(b) Following the occurrence of any Triggering Event or upon
any exchange pursuant to Section 24, the Company shall not be required to
issue fractions of shares of Common Stock upon exercise of the Rights or to
distribute certificates which evidence fractional shares of Common Stock. In
lieu of fractional shares of Common Stock, the Company shall pay to the
registered holders of Right Certificates at the time such Rights are exercised
or exchanged as herein provided an amount in cash equal to the same fraction
of the current market price of a share of Common Stock. For purposes of this
Section 14(c), the current market price of a share of Common Stock shall be
the closing price of a share of Common Stock (as determined pursuant to
Section 11(d)(i)) for the Trading Day immediately prior to the date of such
exercise or exchange.
(c) The holder of a Right by the acceptance of the Right
expressly waives his right to receive any fractional Rights or any fractional
shares upon exercise of a Right except as permitted by this Section 14.
Section 15. Rights of Action. All rights of action in respect of
this Agreement are vested in the respective registered holders of the Right
Certificates (and, prior to the Distribution Date, the registered holders of
certificates representing Common Stock); and any registered holder of any
Right Certificate (or, prior to the Distribution Date, of any certificate
representing Common Stock), without the consent of the Rights Agent or of the
holder of any other Right Certificate (or, prior to the Distribution Date, of
any certificate representing Common Stock), may, in his own behalf and for his
own benefit, enforce, and may institute and maintain any suit, action or
proceeding against the Company to enforce, or otherwise act in respect of, his
right to exercise the Rights evidenced by such Right Certificate in the manner
provided in such Right Certificate and in this Agreement. Without limiting the
foregoing or any remedies available to the holders of Rights, it is
specifically acknowledged that the holders of Rights would not have an
adequate remedy at law for any breach of this Agreement and will be entitled
to specific performance of the obligations under, and injunctive relief
against actual or threatened violations of the obligations of, any Person
subject to this Agreement.
Section 16. Agreement of Right Holders. Every holder of a Right by
accepting the same consents and agrees with the Company and the Rights Agent
and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of Common Stock;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the principal office or offices of the Rights Agent designated for such
purposes, duly endorsed or accompanied by a proper instrument of transfer and
with the appropriate forms and certificates fully executed;
(c) subject to Sections 6 and 7, the Company and the Rights
Agent may deem and treat the Person in whose name a Right Certificate (or,
prior to the Distribution Date, a certificate representing shares of Common
Stock) is registered as the absolute owner thereof and of the Rights evidenced
thereby (notwithstanding any notations of ownership or writing on the Right
Certificate or the certificate representing shares of Common Stock made by
anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent, subject to the last
sentence of Section 7(d), shall be affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the
contrary, neither the Company nor the Rights Agent shall have any liability to
any holder of a Right or other Person as a result of its inability to perform
any of its obligations under this Agreement by reason of any preliminary or
permanent injunction or other order, decree or ruling issued by a court of
competent jurisdiction or by a governmental, regulatory or administrative
agency or commission, or any statute, rule, regulation or executive order
promulgated or enacted by any governmental authority prohibiting or otherwise
restraining performance of such obligation; provided that the Company must use
its best efforts to have any such order, decree or ruling lifted or otherwise
overturned as soon as possible.
Section 17. Right Certificate Holder Not Deemed a Stockholder. No
holder, as such, of any Right Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of the shares of capital
stock 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 or any right to
vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in Section 25), or to receive dividends or
subscription rights, or otherwise, until the Right or Rights evidenced by such
Right Certificate shall have been exercised in accordance with the provisions
hereof.
Section 18. Concerning the Rights Agent. (a) The Company agrees to
pay to the Rights Agent reasonable compensation for all services rendered by
it hereunder and, from time to time, on demand of the Rights Agent, its
reasonable expenses and counsel fees and disbursements and other disbursements
incurred in the execution or administration of this Agreement and the exercise
and performance of its duties hereunder. The Company also agrees to indemnify
the Rights Agent for, and to hold it harmless against, any loss, liability, or
expense, incurred without negligence, bad faith or willful misconduct on the
part of the Rights Agent, for anything done or omitted by the Rights Agent in
connection with the administration of this Agreement or the exercise or
performance of its duties hereunder, including the costs and expenses of
defending against any claim of liability.
(b) The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or omitted by it in
connection with the administration of this Agreement or the exercise or
performance of its duties hereunder in reliance upon any Right Certificate or
certificate for Common Stock or for other securities of the Company,
instrument of assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, instruction, direction, consent, certificate,
statement, or other paper or document believed by it to be genuine and to be
signed, executed and, where necessary, verified or acknowledged, by the proper
Person or Persons.
Section 19. Merger or Consolidation or Change of Name of Rights
Agent. (a) Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the corporate trust or stock transfer business of the Rights
Agent or any successor Rights Agent, shall be the successor to the Rights
Agent under this Agreement without the execution or filing of any paper or any
further act on the part of any of the parties hereto; provided that such
corporation would be eligible for appointment as a successor Rights Agent
under the provisions of Section 21. In case at the time such successor Rights
Agent shall succeed to the agency created by this Agreement, any of the Right
Certificates shall have been countersigned but not delivered, any such
successor Rights Agent may adopt the countersignature of a 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 Agreement.
(b) In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Right Certificates so
countersigned; and in case at that time any of the Right Certificates shall
not have been countersigned, the Rights Agent may countersign such Right
Certificates either in its prior name or in its changed name; and in all such
cases such Right Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes
the duties and obligations imposed by this Agreement upon the following terms
and conditions, by all of which the Company and the holders of Right
Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may be
legal counsel for the Company), and the opinion of such counsel shall be full
and complete authorization and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that any fact
or matter (including, without limitation, the identity of any "Acquiring
Person" and the determination of "current market price") be proved or
established by the Company prior to taking, suffering or omitting to take any
action hereunder, such fact or matter (unless other evidence in respect
thereof be herein specifically prescribed) may be deemed to be conclusively
proved and established by a certificate signed by the Chairman of the Board,
the President or any Vice President and by the Treasurer or any Assistant
Treasurer or the Secretary or any Assistant Secretary of the Company and
delivered to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken, suffered or omitted in
good faith by it under the provisions of this Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable hereunder only for its own
negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of
any of the statements of fact or recitals contained in this Agreement or in
the Right Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be deemed
to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the
validity or execution of any Right Certificate (except its countersignature
thereof); nor shall it be responsible for any breach by the Company of any
covenant or condition contained in this Agreement or in any Right Certificate;
nor shall it be responsible for any change in the exercisability of the Rights
(including the Rights becoming void pursuant to Section 7(d)) or any
adjustment in the terms of the Rights (including the manner, method or amount
thereof) provided for in Sections 3, 11, 13, 23 or 24, or the ascertaining of
the existence of facts that would require any such adjustment (except with
respect to the exercise of Rights evidenced by Right Certificates after actual
notice of any such adjustment); nor shall it by any act hereunder be deemed to
make any representation or warranty as to the authorization or reservation of
any shares of Common Stock to be issued pursuant to this Agreement or any
Right Certificate or as to whether any shares of Common Stock will, when
issued, be duly authorized, validly issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying out or performing
by the Rights Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties hereunder
from the Chairman of the Board, the President or any Vice President or the
Secretary or any Assistant Secretary or the Treasurer or any Assistant
Treasurer of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable for any
action taken, suffered or omitted to be taken by it in good faith in
accordance with instructions of any such officer.
(h) The Rights Agent and any stockholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend
money to the Company or otherwise act as fully and freely as though it were
not the Rights Agent under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or for any
other 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 or to any
holders of Rights resulting from any such act, default, neglect or misconduct,
provided that reasonable care was exercised in the selection and continued
employment thereof.
(j) No provision of this Agreement shall require the Rights
Agent to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder or in the exercise
of its rights if there shall be reasonable grounds for believing that
repayment of such funds or adequate indemnification against such risk or
liability is not reasonably assured to it.
(k) If, with respect to any Right Certificate surrendered to
the Rights Agent for exercise or transfer, the certificate attached to the
form of assignment or form of election to purchase, as the cases may be, has
either not been completed or indicates an affirmative response to clause 1 or
2 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 21. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties under this
Agreement upon 30 days' notice in writing mailed to the Company and to each
transfer agent of the Common Stock by registered or certified mail, and,
subsequent to the Distribution Date, to the holders of the Right Certificates
by first-class mail. The Company may remove the Rights Agent or any successor
Rights Agent upon 30 days' notice in writing, mailed to the Rights Agent or
successor Rights Agent, as the case may be, and to each transfer agent of the
Common Stock and Common Stock by registered or certified mail, and, subsequent
to the Distribution Date, to the holders of the Right Certificates by
first-class mail. If the Rights Agent shall resign or be removed or shall
otherwise become incapable of acting, the Company shall appoint a successor to
the Rights Agent. If the Company shall fail to make such appointment within a
period of 30 days after giving notice of such removal or after it has been
notified in writing of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the holder of a Right Certificate (who shall,
with such notice, submit his Right Certificate for inspection by the Company),
then the registered holder of any Right Certificate may apply to any court of
competent jurisdiction for the appointment of a new Rights Agent. Any
successor Rights Agent, whether appointed by the Company or by such a court,
shall be (a) a corporation organized and doing business under the laws of the
United States or of any state of the United States, in good standing, having a
principal office in the State of New York, which is authorized under such laws
to exercise stock transfer or corporate trust powers and is subject to
supervision or examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined capital and surplus of at
least $50,000,000 or (b) an Affiliate of a corporation described in clause (a)
of this sentence. After appointment, the successor Rights Agent shall be
vested with the same powers, rights, duties and responsibilities as if it had
been originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver
any further assurance, conveyance, act or deed necessary for the purpose. Not
later than the effective date of any such appointment, the Company shall file
notice thereof in writing with the predecessor Rights Agent and each transfer
agent of the Common Stock and the Common Stock, and, subsequent to the
Distribution Date, mail a notice thereof in writing to the registered holders
of the Right Certificates. Failure to give any notice provided for in this
Section 21, or any defect therein, shall not affect the legality or validity
of the resignation or removal of the Rights Agent or the appointment of the
successor Rights Agent, as the case may be.
Section 22. Issuance of New Right Certificates. Notwithstanding
any of the provisions of this Agreement or of the Rights to the contrary, the
Company may, at its option, issue new Right Certificates evidencing Rights in
such form as may be approved by its Board of Directors to reflect any
adjustment or change in the Purchase Price and the number or kind or class of
shares of stock issuable upon exercise of the Rights made in accordance with
the provisions of this Agreement.
Section 23. Redemption. (a) The Board of Directors of the Company
may, at its option, at any time prior to the earlier of (i) the close of
business on the tenth day after the Stock Acquisition Date (or such later date
as a majority of the Continuing Directors may designate prior to such time as
the Rights are no longer redeemable) and (ii) the Final Expiration Date,
redeem all but not less than all the then outstanding Rights at a redemption
price of $.01 per Right, as such amount may be appropriately adjusted to
reflect any stock split, stock dividend or similar transaction occurring after
the date hereof (such redemption price being hereinafter referred to as the
"Redemption Price"); provided that after any Person has become an Acquiring
Person, any redemption of the Rights shall be effective only if there are
Continuing Directors then in office, and such redemption shall have been
approved by a majority of such Continuing Directors. Notwithstanding anything
in this Agreement to the contrary, the Rights shall not be exercisable after
the first occurrence of a Section 11(a)(ii) Event until such time as the
Company's right of redemption hereunder has expired.
(b) Immediately upon the action of the Board of Directors of
the Company electing to redeem the Rights and without any further action and
without any notice, the right to exercise the Rights will terminate and
thereafter the only right of the holders of Rights shall be to receive the
Redemption Price for each Right so held. The Company shall promptly
thereafter give notice of such redemption to the Rights Agent and the holders
of the Rights in the manner set forth in Section 26; provided that the failure
to give, or any defect in, such notice shall not affect the validity of such
redemption. Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each such notice
of redemption will state the method by which the payment of the Redemption
Price will be made. Neither the Company nor any of its Affiliates or
Associates may redeem, acquire or purchase for value any Rights at any time in
any manner other than that specifically set forth in Section 23 or 24, and
other than in connection with the purchase, acquisition or redemption of
shares of Common Stock prior to the Distribution Date.
Section 24. Exchange. (a) At any time after any Person becomes an
Acquiring Person, a majority of the Continuing Directors may, at their option,
exchange all or part of the then outstanding and exercisable Rights (which
shall not include Rights that have become void pursuant to Section 7(d)) for
shares of Common Stock at an exchange ratio of one share of Common Stock per
Right, appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such exchange ratio being
hereinafter referred to as the "Exchange Ratio"). Notwithstanding the
foregoing, the Board of Directors shall not be empowered to effect such
exchange at any time after any Person (other than the Company, any of its
Subsidiaries, any employee benefit plan of the Company or any of its
Subsidiaries or any Person organized, appointed or established by the Company
or any of its Subsidiaries for or pursuant to the terms of any such plan),
together with all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 50% or more of the shares of Common Stock then outstanding.
(b) Immediately upon the action of the Continuing Directors
electing to exchange any Rights pursuant to Section 24(a) and without any
further action and without any notice, the right to exercise such Rights will
terminate and thereafter the only right of a holder of such Rights shall be to
receive that number of shares of Common Stock equal to the number of such
Rights held by such holder multiplied by the Exchange Ratio. The Company
shall promptly thereafter give notice of such exchange to the Rights Agent and
the holders of the Rights to be exchanged in the manner set forth in Section
26; provided that the failure to give, or any defect in, such notice shall not
affect the validity of such exchange. Any notice which is mailed in the
manner herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of exchange will state the method by
which the exchange of the shares of Common Stock for Rights will be effected
and, in the event of any partial exchange, the number of Rights which will be
exchanged. Any partial exchange shall be effected pro rata based on the
number of Rights (other than Rights which have become void pursuant to Section
7(d)) held by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the Company,
at its option, may substitute Common Stock Equivalents (as defined in Section
11(a)(iii)) for shares of Common Stock exchangeable for Rights, at the initial
rate of one Common Stock Equivalent for each share of Common Stock, as
appropriately adjusted to reflect adjustments in dividend, liquidation and
voting rights of Common Stock Equivalents pursuant to the terms thereof, so
that each Common Stock Equivalent delivered in lieu of each share of Common
Stock shall have essentially the same dividend, liquidation and voting rights
as one share of Common Stock.
Section 25. Notice of Proposed Actions. (a) In case the Company
shall propose, at any time after the Distribution Date, (i) to pay any
dividend payable in stock of any class to the holders of Common Stock or to
make any other distribution to the holders of Common Stock (other than a
regular quarterly cash dividend out of earnings or retained earnings of the
Company), or (ii) to offer to the holders of its Common Stock rights or
warrants to subscribe for or to purchase any additional shares of Common Stock
or shares of stock of any class or any other securities, rights or options, or
(iii) to effect any reclassification of its Common Stock (other than a
reclassification involving only the subdivision or combination of outstanding
shares of Common Stock) or (iv) to effect any consolidation or merger with any
other Person, or to effect and/or to permit one or more of its Subsidiaries to
effect any sale or other transfer, in one transaction or a series of related
transactions, of assets or earning power aggregating more than 50% of the
assets or earning power of the Company and its Subsidiaries, taken as a whole,
to any other Person or Persons, or (v) to effect the liquidation, dissolution
or winding up of the Company, then, in each such case, the Company shall give
to each holder of a Right, to the extent feasible and in accordance with
Section 26, a notice of such proposed action, which shall specify the record
date for the purposes of any such dividend, distribution or offering of rights
or warrants, or the date on which any such reclassification, consolidation,
merger, sale, transfer, liquidation, dissolution or winding up is to take
place and the date of participation therein by the holders of Common Stock, if
any such date is to be fixed, and such notice shall be so given in the case of
any action covered by clause (i) or (ii) above at least 20 days prior to the
record date for determining holders of the Common Stock entitled to
participate in such dividend, distribution or offering, and in the case of any
such other action, at least 20 days prior to the date of the taking of such
proposed action or the date of participation therein by the holders of Common
Stock, whichever shall be the earlier. The failure to give notice required by
this Section or any defect therein shall not affect the legality or validity
of the action taken by the Company or the vote upon any such action.
(b) Notwithstanding anything in this Agreement to the
contrary, prior to the Distribution Date a public filing by the Company with
the Securities and Exchange Commission shall constitute sufficient notice to
the holders of securities of the Company, including the Rights, for purposes
of this Agreement and no other notice need be given to such holders.
(c) If a Triggering Event shall occur, then, in any such case,
(1) the Company shall as soon as practicable thereafter give to each holder of
a Right, in accordance with Section 26, a notice of the occurrence of such
event, which shall specify the event and the consequences of the event to
holders of Rights under Section 11(a)(ii) or 13, as the case may be.
Section 26. Notices. Notices or demands authorized by this
Agreement to be given or made by the Rights Agent or by the holder of any
Right to or on the Company shall be sufficiently given or made if sent by
first-class mail (postage prepaid) to the address of the Company indicated on
the signature page hereof or such other address as the Company shall specify
in writing to the Rights Agent. Subject to the provisions of Section 21, any
notice or demand authorized by this Agreement to be given or made by the
Company or by the holder of any Right to or on the Rights Agent shall be
sufficiently given or made if sent by first-class mail (postage prepaid) to
the address of the Rights Agent indicated on the signature page hereof or such
other address as the Rights Agent shall specify in writing to the Company.
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate (or, prior
to the Distribution Date, to the holder of any certificate representing shares
of Common Stock) shall be sufficiently given or made if sent by first-class
mail (postage prepaid) to the address of such holder shown on the registry
books of the Company.
Section 27. Supplements and Amendments. Prior to the Distribution
Date, the Company and the Rights Agent shall, if the Company so directs,
supplement or amend any provision of this Agreement without the approval of
any holders of certificates representing shares of Common Stock. From and
after the Distribution Date, the Company and the Rights Agent shall, if the
Company so directs, supplement or amend this Agreement without the approval of
any holders of Right Certificates in order (a) to cure any ambiguity, (b) to
correct or supplement any provision contained herein which may be defective or
inconsistent with any other provisions herein or (c) to change or supplement
the provisions hereof in any manner which the Company may deem necessary or
desirable and which shall not adversely affect the interests of the holders of
Rights (other than an Acquiring Person or an Affiliate or Associate of an
Acquiring Person). Notwithstanding the foregoing, after any Person has become
an Acquiring Person, any supplement or amendment shall be effective only if
there are Continuing Directors then in office, and such supplement or
amendment shall have been approved by a majority of such Continuing Directors.
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, the Rights Agent shall execute such supplement or
amendment. Prior to the Distribution Date, the interests of the holders of
Rights shall be deemed coincident with the interests of the holders of Common
Stock.
Section 28. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
Section 29. Determinations and Actions by the Board of Directors,
etc. For all purposes of this Agreement, any calculation of the number of
shares of Common Stock outstanding at any particular time, including for
purposes of determining the particular percentage of such outstanding shares
of Common Stock of which any Person is the Beneficial Owner, shall be made in
accordance with the last sentence of Rule 13d-3(d)(1)(i) under the Exchange
Act as in effect on the date of this Agreement. The Board of Directors of the
Company (or, after any Person has become an Acquiring Person, a majority of
the Continuing Directors) shall have the exclusive power and authority to
administer this Agreement and to exercise all rights and powers specifically
granted to the Board or to the Company, or as may be necessary or advisable in
the administration of this Agreement, including the right and power to (i)
interpret the provisions of this Agreement and (ii) make all determinations
deemed necessary or advisable for the administration of this Agreement
(including a determination to redeem or exchange or not to redeem or exchange
the Rights or to amend the Agreement). All such actions, calculations,
interpretations and determinations (including, for purposes of clause (y)
below, all omissions with respect to the foregoing) which are done or made by
the Board (or, after any Person has become an Acquiring Person, by the
Continuing Directors) in good faith shall (x) be final, conclusive and binding
on the Company, the Rights Agent, the holders of the Rights and all other
parties, and (y) not subject the Board of Directors of the Company or the
Continuing Directors to any liability to the holders of the Rights.
Section 30. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any Person other than the Company, the Rights
Agent and the registered holders of the Right Certificates (and, prior to the
Distribution Date, the certificates representing the shares of Common Stock)
any legal or equitable right, remedy or claim under this Agreement; but this
Agreement shall be for the sole and exclusive benefit of the Company, the
Rights Agent and the registered holders of the Right Certificates (and, prior
to the Distribution Date, the certificates representing the shares of Common
Stock).
Section 31. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain
in full force and effect and shall in no way be affected, impaired or
invalidated; provided that, notwithstanding anything in this Agreement to the
contrary, if any such term, provision, covenant or restriction is held by such
court or authority to be invalid, void or unenforceable and the Board of
Directors of the Company (or, after any Person has become an Acquiring Person,
a majority of the Continuing Directors) determines in its good faith judgment
that severing the invalid language from this Agreement would adversely affect
the purpose or effect of this Agreement, the right of redemption set forth in
Section 23 hereof shall be reinstated and shall not expire until the close of
business on the tenth day following the date of such determination by the
Board of Directors or Continuing Directors, as the case may be.
Section 32. Governing Law. This Agreement, each Right and each Right
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of Delaware and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts to
be made and performed entirely within such State, except that the rights and
obligations of the Rights Agent shall be governed by the law of the State of
New York.
Section 33. Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together constitute
one and the same instrument.
Section 34. Descriptive Headings. The captions herein are included
for convenience of reference only, do not constitute a part of this Agreement
and shall be ignored in the construction and interpretation hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of
the day and year first above written.
VILLAGE BANCORP, INC.
/s/ Robert V. Macklin
By: ______________________________
Name: Robert V. Macklin
Title: President and Chief
Executive Officer
Village Bancorp, Inc.
25 Prospect Street
Ridgefield, CT 06877
Attention: President and Chief
Executive Officer
AMERICAN STOCK TRANSFER &
TRUST COMPANY
/s/ Herbert J. Lemmer
By: ____________________________
Name: Herbert J. Lemmer
Title: Vice President
American Stock Transfer & Trust Company
40 Wall Street
46th Floor
New York, NY 10005
Attention: Executive Vice President
Exhibit A
[Form of Right Certificate]
No. R- ____________Rights
NOT EXERCISABLE AFTER THE EARLIER OF OCTOBER 4, 2006 AND THE DATE ON WHICH THE
RIGHTS EVIDENCED HEREBY ARE REDEEMED OR EXCHANGED BY THE COMPANY AS SET FORTH
IN THE RIGHTS AGREEMENT. AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS ISSUED
TO, OR HELD BY, ANY PERSON WHO IS, WAS OR BECOMES AN ACQUIRING PERSON OR AN
AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT), WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR BY ANY
SUBSEQUENT HOLDER, MAY BE NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS
RIGHT CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME
AN ACQUIRING PERSON OR AN AFFILIATE OR AN ASSOCIATE OF AN ACQUIRING PERSON (AS
SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). THIS RIGHT CERTIFICATE AND
THE RIGHTS REPRESENTED HEREBY MAY BE OR MAY BECOME NULL AND VOID IN THE
CIRCUMSTANCES SPECIFIED IN SECTION 7(d) OF THE RIGHTS AGREEMENT.](1)
RIGHT CERTIFICATE
VILLAGE BANCORP, INC.
This Right Certificate certifies that ______________________, or
registered assigns, is the registered holder of the number of Rights set
forth above, each of which entitles the holder (upon the terms and subject
to the conditions set forth in the Rights Agreement dated as of September
19, 1996 (the "Rights Agreement") between Village Bancorp, Inc., a Delaware
corporation (the "Company"), and American Stock Transfer & Trust Company
(the "Rights Agent")) to purchase from the Company, at any time after the
Distribution Date and prior to the Expiration Date, ___ one-tenth[s] of a
fully paid, nonassessable share (each such one-tenth of a share being a
"Unit") of Common Stock, par value $3.33, of the Company (the "Common
Stock") at a purchase price of $6.00 per Unit of Common Stock (the
"Purchase Price"), payable in lawful money of the United States of America,
upon surrender of this Right Certificate, with the form of election to
purchase and related certificate duly executed, and payment of the Purchase
Price at an office of the Rights Agent designated for such purpose.
- ------------------
(1) If applicable, insert this portion of the legend and delete the preceding
sentence.
Terms used herein and not otherwise defined herein have the
meanings assigned to them in the Rights Agreement.
The number of Rights evidenced by this Right Certificate (and
the number and kind of shares issuable upon exercise of each Right) and the
Purchase Price set forth above are as of October 4, 1996, and may have been or
in the future be adjusted as a result of the occurrence of certain events, as
more fully provided in the Rights Agreement.
Upon the occurrence of a Section 11(a)(ii) Event, if the Rights
evidenced by this Right Certificate are beneficially owned by (a) an Acquiring
Person or an Associate or Affiliate of an Acquiring Person, (b) a transferee
of an Acquiring Person (or any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person becomes such, or (c) under certain
circumstances specified in the Rights Agreement, a transferee of an Acquiring
Person (or any such Associate or Affiliate) who becomes a transferee prior to
or concurrently with the Acquiring Person becoming such, such Rights shall
become null and void, and no holder hereof shall have any right with respect
to such Rights from and after the occurrence of such Section 11(a)(ii) Event.
This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms, provisions and
conditions are hereby incorporated herein by reference and made a part hereof
and to which Rights Agreement reference is hereby made for a full description
of the rights, limitations of rights, obligations, duties and immunities
hereunder of the Rights Agent, the Company and the holders of the Right
Certificates, which limitations of rights include the temporary suspension of
the exercisability of such Rights under the specific circumstances set forth
in the Rights Agreement.
Upon surrender at the principal office or offices of the Rights
Agent designated for such purpose and subject to the terms and conditions set
forth in the Rights Agreement, any Rights Certificate or Certificates may be
transferred or exchanged for another Rights Certificate or Certificates
evidencing a like number of Rights as the Rights Certificate or Certificates
surrendered.
Subject to the provisions of the Rights Agreement, the Board of
Directors of the Company may, at its option,
(a) at any time prior to the earlier of (i) the close of
business on the tenth day after the Stock Acquisition Date (or such
later date as a majority of the Continuing Directors may designate
prior to such time as the Rights are no longer redeemable) and (ii)
the Final Expiration Date, redeem all but not less than all the then
outstanding Rights at a redemption price of $.01 per Right; or
(b) at any time after any Person becomes an Acquiring Person
(but before such Person becomes the Beneficial Owner of 50% or more
of the shares of Common Stock then outstanding), exchange all or part
of the then outstanding Rights (other than Rights held by the
Acquiring Person and certain related Persons) for shares of Common
Stock at an exchange ratio of one share of Common Stock per Right.
If the Rights shall be exchanged in part, the holder of this Right
Certificate shall be entitled to receive upon surrender hereof
another Right Certificate or Certificates for the number of whole
Rights not exchanged.
No fractional shares of Common Stock are required to be issued
upon the exercise of any Right or Rights evidenced hereby (other than
fractions which are multiples of one-tenth of a share of Common Stock, which
may, at the election of the Company, be evidenced by depositary receipts), but
in lieu thereof a cash payment will be made, as provided in the Rights
Agreement. If this Right Certificate shall be exercised in part, the holder
shall be entitled to receive upon surrender hereof another Right Certificate
or Certificates for the number of whole Rights not exercised.
No holder of this Right Certificate shall be entitled to vote,
receive dividends or be deemed for any purpose the holder of the shares of
capital stock which may at any time be issuable on the exercise hereof, nor
shall anything contained in the Rights Agreement or herein be construed to
confer upon the holder hereof, as such, any of the rights of a stockholder of
the Company or any right to vote for the election of directors or upon any
matter submitted to stockholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of meetings or
other actions affecting stockholders (except as provided in the Rights
Agreement), or to receive dividends or subscription rights, or otherwise, until
the Right or Rights evidenced by this Right Certificate shall have been
exercised as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal by its authorized officers.
Dated as of ________________, 19__
VILLAGE BANCORP, INC.
By______________________
Title:
[SEAL]
Attest:
______________________
Secretary
Countersigned:
AMERICAN STOCK TRANSFER & TRUST COMPANY
as Rights Agent
By____________________
Authorized Signature
Form of Reverse Side of Right Certificate
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: _____________________, 19__
___________________________
Signature
Signature Guaranteed:
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: __________, 19 __ ________________________
Signature
__________
The signatures 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.
__________
FORM OF ELECTION TO PURCHASE
(To be executed if the registered holder desires to exercise
Rights represented by the Right Certificate.)
To: Village Bancorp, Inc.
The undersigned hereby irrevocably elects to exercise
____________ Rights represented by this Right Certificate to purchase shares
of Common Stock issuable upon the exercise of the Rights (or such other
securities of the Company or of any other person which may be issuable upon
the exercise of the Rights) and requests that certificates for such securities
be issued in the name of and delivered to:
Please insert social security
or other identifying number
__________________________________________________________
(Please print name and address)
___________________________________________________________
If such number of Rights shall not be all the Rights evidenced
by this Right Certificate, a new Right Certificate for the balance of such
Rights shall be registered in the name of and delivered to:
Please insert social security
or other identifying number
___________________________________________________________
(Please print name and address)
___________________________________________________________
Dated: ________________, 19__
___________________________
Signature
Signature Guaranteed:
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: __________, 19 __ ________________________
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.
__________
Exhibit B
VILLAGE BANCORP, INC.
STOCKHOLDER RIGHTS PLAN
Summary of Terms
Form of Security: The Board of Directors has declared a dividend of
one common stock purchase right for each
outstanding share of the Company's Common Stock,
payable to holders of record as of the close of
business on October 4, 1996 (each a "Right" and
collectively, the "Rights")
Transfer: Prior to the Distribution Date(1), the Rights
will be evidenced by the certificates for and
will be transferred with the Common Stock, and
the registered holders of the Common Stock will
be deemed to be the registered holders of the
Rights.
After the Distribution Date, the Rights Agent
will mail separate certificates evidencing the
Rights to each record holder of the Common Stock
as of the close of business on the Distribution
Date, and thereafter the Rights will be
transferable separately from the Common Stock.
Exercise: Prior to the Distribution Date(1), the Rights
will not be exercisable.
After the Distribution Date, each Right will be
exercisable to purchase, for $6.00 (the "Purchase
Price"), one-tenth of a share (each such
one-tenth of a share being a "Unit") of the
Company's Common Stock.
- ------------
(1) Distribution Date means the earlier of:
(1) the 10th day after public announcement that any portion or
group has become the beneficial owner of 15% or more of the
Company's Common Stock and
(2) the 10th business day after the date of commencement of a
tender or exchange offer by any person which would, if
consummated, result in such person becoming the beneficial
owner of 15% or more of the Company's Common Stock
in each case, subject to extension by a majority of the Directors
affiliated with the Acquiring Person.
Flip-In: If any person or group (an "Acquiring Person")
becomes the beneficial owner of 15% or more of
the Company's Common Stock, then each Right
(other than Rights beneficially owned by the
Acquiring Person and certain affiliated persons)
will entitle the holder to purchase, for ten
times the Purchase Price (the "Adjusted Purchase
Price"), a number of shares of the Company's
Common Stock having a market value of twice the
Adjusted Purchase Price.
Flip-Over: If, after any person has become an Acquiring
Person, (1) the Company is involved in a merger
or other business combination in which the
Company is not the surviving corporation or its
Common Stock is exchanged for other securities
or assets or (2) the Company and/or one or more
of its subsidiaries sell or otherwise transfer
assets or earning power aggregating more than
50% of the assets or earning power of the
Company and its subsidiaries, taken as a whole,
then each Right will entitle the holder to
purchase, for the Adjusted Purchase Price, a
number of shares of common stock of the other
party to such business combination or sale (or
in certain circumstances, an affiliate) having a
market value of twice the Adjusted Purchase
Price.
Exchange: At any time after any person has become an
Acquiring Person (but before any person becomes
the beneficial owner of 50% or more of the
Company's Common Stock), a majority of the
Directors not affiliated with the Acquiring
Person may exchange all or part of the Rights
(other than the Rights beneficially owned by the
Acquiring Person and certain affiliated persons)
for shares of Common Stock at an exchange ratio
of one share of Common Stock per Right.
Redemption: The Board of Directors may redeem all of the
Rights at a price of $.01 per Right at any time
prior to the close of business on the 10th day
after public announcement that any person has
become an Acquiring Person (subject to extension
by a majority of the Directors not affiliated
with the Acquiring Person).
After any person has become an Acquiring Person,
the Rights may be redeemed only with the approval
of a majority of the Directors not affiliated
with the Acquiring Person.
Expiration: The Rights will expire on October 4, 2006 unless
earlier exchanged or redeemed.
Amendments: Prior to the Distribution Date, the Rights
Agreement may be amended in any respect.
After the Distribution Date, the Rights Agreement
may be amended in any respect that does not
adversely affect the Rights holders (other than
any Acquiring Person and certain affiliated
persons).
After any person has become an Acquiring Person,
the Rights Agreement may be amended only with the
approval of a majority of the Directors not
affiliated with the Acquiring Person.
Voting Rights: Rights holders have no rights as a stockholder
of the Company, including the right to vote and
to receive dividends.
Antidilution The Rights Agreement includes antidilution
provisions Provisions: designed to
prevent efforts to diminish the efficacy of the
Rights.
Taxes: While the dividend of the Rights will not be
taxable to stockholders or to the Company,
stockholders or the Company may, depending upon
the circumstances, recognize taxable income in
the event that the Rights become exercisable as
set forth above.
_______________
A copy of the Rights Agreement has been filed with the Securities and Exchange
Commission as an Exhibit to a Registration Statement on Form 8-A. A copy of
the Rights Agreement is available free of charge from the Company. This
summary description of the Rights does not purport to be complete and is
qualified in its entirety by reference to the Rights Agreement.
