SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
December 6, 1995
(Date of earliest event reported)
HARTMARX CORPORATION
(Exact name of Registrant as specified in its charter)
Delaware 1-8501 36-3217140
(State of (Commission File No.) (IRS Employer
Incorporation) Identification No.)
101 North Wacker Drive
Chicago, Illinois 60606
(Address of principal executive offices, including zip code)
(312) 372-6300
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
ITEM 5. OTHER EVENTS.
Rights Agreement
On December 6, 1995, the Board of Directors of
Hartmarx Corporation (the "Company") approved the exten-
sion of the benefits afforded by the Company's existing
rights plan by adopting a new shareholder rights plan.
The new plan, like the existing plan, is intended to
promote continuity and stability, deter coercive or
partial offers which will not provide fair value to all
shareholders and enhance the Board's ability to represent
all shareholders and thereby maximize shareholder values.
Pursuant to the new Rights Agreement between
the Company and First Chicago Trust Company of New York,
as Rights Agent (the "1995 Rights Agreement"), one Right
will be issued for each outstanding share of common
stock, par value $2.50 per share, of the Company on the
expiration of the existing rights (January 31, 1996).
Each of the new Rights will entitle the registered holder
to purchase from the Company one one-thousandth of a
share of Series A Junior Participating Preferred Stock,
par value $1.00 per share, at a price of $25 per one one-
thousandth of a share. The Rights, however, will not
become exercisable unless and until, among other things,
any person acquires 15% or more of the outstanding common stock.
The new Rights are redeemable under certain circumstances
at $.01 per Right and will expire, unless earlier re-
deemed, on January 31, 2006.
The description and terms of the new Rights are
set forth in the 1995 Rights Agreement, a copy of which
is filed herewith and is incorporated herein by refer-
ence.
By-Law Amendments
On December 6, 1995, the Board of Directors of
the Company approved certain amendments to the Company's
existing By-Laws. These amendments to the By-Laws are
summarized below.
Article I, Section 1 of the By-Laws was amended
to provide that no business may be transacted at an
annual meeting of stockholders of the Company other than
business that is (i) specified in the notice of meeting
given by the Board of Directors of the Company, (ii)
otherwise properly brought before the annual meeting by
the Board of Directors of the Company or (iii) otherwise
properly brought before the annual meeting by any stock-
holder of the Company. For business to be properly brought
before an annual meeting by a stockholder, the By-Laws require
that the stockholder must give notice of such business, in proper
written form as provided in the By-laws, to the Secretary of
the Company no earlier than December 15 and no later than
February 15 immediately preceding such annual meeting.
Article II, Section 3 of the By-Laws was amend-
ed to provide that persons may be nominated to stand for
election as a director of the Company only (i) by or at
the direction of the Board of Directors of the Company or
(ii) by any stockholder of the Company (A) who is a
stockholder of record on the record date for the determination
of stockholders entitled to vote at the annual meeting and
(B) who submits to the Company a notice of the nomination
for election, in proper written form as provided in the By-Laws,
(1) with respect to an election to be held at an annual meeting
of stockholders, no earlier than December 15 and no later
than February 15 immediately preceding such annual meeting or
(2) with respect to an election to be held at a special meeting
of stockholders, the close of business on the fifteenth day
following the earlier of the date on which notice of such meeting
is first given to stockholders or the date on which public
disclosure of such meeting is first made. Such notice must be
accompanied by a written consent of each proposed nominee to be
named as a nominee and to serve as a director if elected.
Article II, Section 10 of the By-Laws relating
to indemnification of officers and directors was
amended to, among other things, provide that (i) the
Company will advance to any person defending an
action for which indemnification under the By-Laws is
available any expenses incurred by such person during
such defense, provided that such person undertakes to
reimburse the Company for all advanced expenses in the
event that it shall ultimately be determined that such
person is not entitled to indemnification and (ii) rights
to indemnification may not be retroactively reduced by
subsequent amendment to the General Corporation Law of
the State of Delaware or the By-Laws.
The foregoing description of the amended By-
Laws does not purport to be complete and is qualified in
its entirety by reference to the amended By-Laws which
are attached hereto as an exhibit and incorporated herein
by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
Exhibits:
3.2 By-Laws of Hartmarx Corporation, as amended
through December 6, 1995.
4.1 Rights Agreement, dated as of December 6, 1995,
between Hartmarx Corporation and First Chicago
Trust Company of New York, as Rights Agent,
which includes as Exhibit A the Certificate of
Designation, Preferences and Rights of the
Series A Junior Participating Preferred Stock
and as Exhibit B the form of Rights Certificate.
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned
hereunto duly authorized.
HARTMARX CORPORATION
By: /S/ GLENN R. MORGAN
Name: Glenn R. Morgan
Title: Executive Vice Presi
dent and Chief Financial
Officer
Date: December 29, 1995
EXHIBIT INDEX
Exhibit Description Page
3.2 By-Laws of Hartmarx Corporation,
as amended through December 6,
1995
4.1 Rights Agreement, dated as of
December 6, 1995, between
Hartmarx Corporation and First
Chicago Trust Company of New
York, as Rights Agent, which
includes as Exhibit A the Cer-
tificate of Designation, Prefer-
ences and Rights of the Series A
Junior Participating Preferred
Stock and as Exhibit B the form
of Rights Certificate.
BY-LAWS
OF
HARTMARX CORPORATION
(Formed under the laws of the State of Delaware)
As Adopted by the Board of Directors to December 6, 1995
ARTICLE I
STOCKHOLDERS
Section 1. Annual Meeting. A meeting of
the stockholders for the election of directors and the
transaction of only such other business as is properly
brought before the meeting in accordance with these By-
Laws shall be held annually on a day between April 1 and
April 20, inclusive, to be designated by the Board of
Directors and in the absence of such designation, on the
first Monday in April, or, if it be a public holiday, on
the next succeeding business day.
To be properly brought before the meeting,
business must be either (a) specified in the notice of
meeting (or any supplement thereto) given by or at the
direction of the Board, (b) otherwise properly brought
before the meeting by or at the direction of the Board,
or (c) otherwise properly brought before the meeting by a
stockholder. In addition to any other applicable
requirements, for business to be properly brought before
an annual meeting by a stockholder, the stockholder must
have given timely notice thereof in writing to the
Secretary of the Corporation. To be timely, a
stockholder's notice must be delivered to or mailed and
received at the principal executive offices of the
Corporation, no earlier than December 15 and no later
than February 15 immediately preceding the annual meeting
of stockholders. A stockholder's notice to the Secretary
shall set forth as to each matter the stockholder
proposes to bring before the annual meeting (i) a brief
description of the business desired to be brought before
the annual meeting and the reasons for conducting such
business at the annual meeting, (ii) the name and record
address of the stockholder proposing such business, (iii)
the class and number of shares of the Corporation which
are beneficially owned by the stockholder, and (iv) any
material interest of the stockholder in such business.
The Chairman of an annual meeting shall, if the
facts warrant, determine and declare to the meeting that
business was not properly brought before the meeting in
accordance with the provisions of this Section 1, and if
he should so determine, he shall so declare to the
meeting and any such business not properly brought before
the meeting shall not be transacted.
Section 2. Special Meetings. Special
meetings of the stockholders may be called by the Board
of Directors or, subject to the control of the Board, by
the Chairman, or in his absence, the President.
Section 3. Place of Meetings. Meetings of
stockholders shall be held at such place, within or
without the State of Delaware, as may be fixed by the
Board of Directors. If no place is so fixed, such
meetings shall be held at the office of the Corporation
in the City of Chicago, in the State of Illinois.
Section 4. Notice of Meetings. Notice of
each meeting of stockholders shall be given in writing
and shall state the place, date and hour of the meeting
and the purpose or purposes for which the meeting is
called. Notice of a special meeting shall indicate that
it is being issued by or at the direction of the person
or persons calling or requesting the meeting.
If, at any meeting, action is proposed to be
taken which would, if taken, entitle objecting
stockholders to receive payment for their shares of
stock, the notice shall include a statement of that
purpose and to that effect.
A copy of the notice of each meeting shall be
given, personally or by first class mail, not less than
ten nor more than sixty days before the date of the
meeting, to each stockholder entitled to vote at such
meeting. If mailed, such notice is given when deposited
in the United States mail, with postage thereon prepaid,
directed to the stockholder at his address as it appears
on the record of stockholders, or, if he shall have filed
with the Secretary of the Corporation a written request
that notices to him be mailed to some other address, then
directed to him at such other address.
When a meeting is adjourned to another time or
place, it shall not be necessary to give any notice of
the adjourned meeting if the time and place to which the
meeting is adjourned are announced at the meeting at
which the adjournment is taken, and at the adjourned
meeting any business may be transacted that might have
been transacted on the original date of the meeting.
However, if the adjournment is for more than thirty (30)
days, or if after the adjournment, the Board of Directors
fixes a new record date for the adjourned meeting, a
notice of the adjourned meeting shall be given to each
stockholder of record on the new record date entitled to
notice under the preceding paragraphs of this Section 4.
Section 5. Waiver of Notice. Notice of any
meeting need not be given to any stockholder who submits
a signed waiver of notice, in person or by proxy, whether
before or after the meeting. The attendance of any
stockholder at a meeting, in person or by proxy, without
protesting prior to the conclusion of the meeting the
lack of notice of such meeting, shall constitute a waiver
of notice by him.
Section 6. Inspectors of Election. The
Board of Directors shall, in advance of any stockholders'
meeting, appoint one or more inspectors to act at the
meeting or any adjournment thereof and to make a written
report thereof. The Board of Directors may designate one
or more alternate inspectors to replace any inspector who
fails to act. If no inspector or alternate is able to
act, the person presiding at the meeting shall appoint
one or more inspectors to act at the meeting. Each
inspector, before entering upon the discharge of his
duties, shall take and sign an oath faithfully to execute
his duties of inspector with strict impartiality and
according to the best of his ability.
The inspector(s) shall ascertain the number of
shares outstanding and the voting power of each,
determine the shares represented at the meeting, the
existence of a quorum and the validity of proxies and
ballots, count all votes and ballots, determine and
retain for a reasonable period a record of the
disposition of any challenges made to any determination
by the inspector(s), certify their determination of the
number of shares represented at the meeting and their
count of all votes and ballots, and do such other acts as
are proper to conduct the election or vote with fairness
to all stockholders. The inspector(s) may appoint or
retain other persons or entities to assist the
inspector(s) in the performance of the duties of the
inspector(s). Any record or certificate made by the
inspectors shall be prima facie evidence of the facts
stated and of the vote as certified by said inspector(s).
Section 7. List of Stockholders at Meetings. The
Secretary shall provide a complete list of the stockholders
entitled to vote at the ensuing election, arranged in alphabetical
order, with the address of each, and the number of shares
held by each. Such list shall be open to the examination
of any stockholder, for any purpose germane to the
meeting, during ordinary business hours, for a period of
at least ten days prior to the meeting, either at a place
within the city where the meeting is to be held, which
place shall be specified in the notice of the meeting,
or, if not so specified, at the place where the meeting
is to be held. The list shall also be produced and kept
at the time and place of the meeting during the whole
time thereof, and may be inspected by any stockholder who
is present.
Section 8. Qualification of Voters. Unless
otherwise provided in the Certificate of Incorporation,
every stockholder of record shall be entitled at every
meeting of stockholders to one vote for every share of
stock standing in his name on the record of stockholders.
Treasury shares as of the record date and
shares held as of the record date by another domestic or
foreign corporation of any type or kind, if a majority of
the shares entitled to vote in the election of directors
of such other corporation is held as of the record date
by the Corporation, shall not be shares entitled to vote
or to be counted in determining the total number of
outstanding shares.
Shares held by an administrator, executor,
guardian, conservator, committee, or other fiduciary,
except a trustee, may be voted by him, either in person
or by proxy, without transfer of such shares into his
name. Shares held by a trustee may be voted by him,
either in person or by proxy, only after the shares have
been transferred into his name as trustee or into the
name of his nominee.
Shares standing in the name of another domestic
or foreign corporation of any type or kind may be voted
by such officer, agent or proxy as the By-Laws of such
corporation may provide, or, in the absence of such
provision, as the board of directors of such corporation
may determine.
A stockholder shall not sell his vote or issue
a proxy to vote to any person for any sum of money or
anything of value except as permitted by law.
Section 9. Quorum of Stockholders. The
holders of not less than one-third of the shares of stock
entitled to vote thereat shall constitute a quorum at a
meeting of stockholders for the transaction of any
business, provided that when a specified item of business
is required to be voted on by a class or series, voting
as a class, the holders of not less than one-third of the
shares of such class or series of stock shall constitute
a quorum for the transaction of such specified item of
business.
When a quorum is once present to organize a
meeting, it is not broken by the subsequent withdrawal of
any stockholders.
The stockholders who are present in person or
by proxy and who are entitled to vote may, by a majority
of votes cast, adjourn the meeting despite the absence of
a quorum.
Section 10. Proxies. Every stockholder
entitled to vote at a meeting of stockholders or to
express consent or dissent without a meeting may
authorize another person or persons to act for him by
proxy.
Every proxy must be signed by the stockholder
or his attorney-in-fact. No proxy shall be valid after
the expiration of three years from the date thereof
unless otherwise provided in the proxy. Every proxy
shall be revocable at the pleasure of the stockholder
executing it, except as otherwise provided by law.
The authority of the holder of a proxy to act
shall not be revoked by the incompetence or death of the
stockholder who executed the proxy unless, before the
authority is exercised, written notice of an adjudication
of such incompetence or of such death is received by the
Secretary or any Assistant Secretary.
Section 11. Vote of Stockholders. Directors
shall, except as otherwise required by law, be elected by
a plurality of the votes cast at a meeting of
stockholders by the holders of shares entitled to vote in
the election.
Whenever any corporate action, other than the
election of directors, is to be taken by vote of the
stockholders, it shall, except as otherwise required by
law or the Certificate of Incorporation or the By-Laws,
be authorized by a majority of the votes cast at a
meeting of stockholders by the holders of shares entitled
to vote thereon.
Section 12. Fixing Record Date. For the
purpose of determining the stockholders entitled to
notice of or to vote at any meeting of stockholders or
any adjournment thereof, or to express consent to or
dissent from any proposal without a meeting, or for the
purpose of determining stockholders entitled to receive
payment of any dividend or the allotment of any rights,
or for the purpose of any other action, the Board of
Directors may fix, in advance, a date as the record date
for any such determination of stockholders. Such date
shall not be more than sixty nor less than ten days
before the date of such meeting, nor more than sixty days
prior to any other action.
When a determination of stockholders of record
entitled to notice of or to vote at any meeting of
stockholders has been made as provided in this section,
such determination shall apply to any adjournment
thereof, unless the Board of Directors fixes a new record
date for the adjourned meeting.
ARTICLE II
BOARD OF DIRECTORS
Section 1. Power of Board and Qualification of
Directors. The business of the Corporation shall be managed by
the Board of Directors. Each director shall be at least twenty-one
years of age.
Section 2. Number of Directors. The number
of directors constituting the entire Board of Directors
shall be thirteen, except that, effective December 6,
1995, the number shall be increased to fourteen, but only
during the remainder of the terms of the incumbent
directors. A majority of the total number of directors
authorized by this By-Law may amend this By-Law, to
change the number of directors, provided, however, that
no decrease in the number of directors shall shorten the
term of an incumbent director.
Section 3. Election and Term of Directors.
At each annual meeting of stockholders, directors shall
be elected to hold office until the next annual meeting
and until their successors have been elected and
qualified.
Only persons who are nominated in accordance
with the following procedures shall be eligible for
election as directors. Nominations for the election of
directors may be made by the Board of Directors or by a
committee appointed by the Board of Directors, or by any
stockholder entitled to vote in the election of directors
generally, provided that such stockholder has given
actual written notice of such stockholder's nomination or
nominations to the Secretary of the Corporation (a) with
respect to an election to be held at an annual meeting of
stockholders, no earlier than December 15 and no later
than February 15 immediately preceding the annual meeting
of stockholders, and (b) with respect to an election to
be held at a special meeting of stockholders for the
election of directors, the close of business on the
fifteenth day following (i) the date on which notice of
such meeting is first given to stockholders or (ii) the
date on which public disclosure of such meeting is first
made, whichever is earlier.
Each such notice shall set forth: (a) the name
and record address of the stockholder who intends to make
the nomination and the name, age, business address and
residence address of the person or persons to be
nominated; (b) a representation that the stockholder is a
holder of record of stock of the Corporation entitled to
vote at such meeting and intends to appear in person or
by proxy at the meeting to nominate the person or persons
specified in the notice and stating the number of shares
held by such stockholder; (c) a description of all
arrangements or understandings involving any stockholder,
each such nominee and any other person or persons (naming
such person or persons) pursuant to which the nomination
or nominations are to be made by the stockholder or
relating to the Corporation or its securities or to such
nominee's service as a director if elected; (d) such
other information regarding such nominee proposed by such
stockholder as would be required to be disclosed in
solicitations for proxies for election of Directors
pursuant to Rule 14a under the Securities Exchange Act of
1934, as amended; and (e) the consent of each nominee to
serve as a director of the Corporation if so elected.
The Corporation may require any proposed nominee to
furnish such other information as may reasonably be
required by the Corporation to determine the eligibility
of such proposed nominee to serve as a director of the
Corporation.
The Chairman of the meeting shall, if the facts
warrant, determine and declare to the meeting that a
nomination was not made in accordance with the foregoing
procedure, and if he should so determine, he shall so
declare to the meeting and the defective nomination shall
be disregarded.
Section 4. Quorum of Directors and Action
by the Board. A majority of the entire Board of
Directors shall constitute a quorum for the transaction
of business, and, except where otherwise provided in
these By-Laws, the vote of a majority of the directors
present at a meeting at the time of such vote, if a
quorum is then present, shall be the act of the Board.
Section 5. Meetings of the Board. An
annual meeting of the Board of Directors shall be held in
each year directly after the annual meeting of
stockholders. Regular meetings of the Board shall be
held at such times as may be fixed by the Board. Special
meetings of the Board may be held at any time upon the
call of the Chairman, or in his absence, the President,
or upon the call of any two directors.
Meetings of the Board of Directors shall be
held at such places as may be fixed by the Board for
annual and regular meetings and in the notice of meeting
for special meetings.
No notice need be given of annual or regular
meetings of the Board of Directors. Notice of each
special meeting of the Board shall be given to each
director either by mail not later than noon, Chicago
time, on the third day prior to the meeting or by
telegram, written message or orally to the director not
later than noon, Chicago time, on the day prior to the
meeting. Notices are deemed to have been given: by
mail, when deposited in the United States mail; by
telegram at the time of filing; and by messenger at the
time of delivery. Notices by mail, telegram or messenger
shall be sent to each director at the address designated
by him for that purpose, or, if none has been so
designated, at his last known residence or business
address.
Notice of a meeting of the Board of Directors
need not be given to any director who submits a signed
waiver of notice whether before or after the meeting, or
who attends the meeting without protesting, prior thereto
or at its commencement, the lack of notice to him.
A notice, or waiver of notice, need not specify
the purpose of any meeting of the Board of Directors.
A majority of directors present, whether or not
a quorum is present, may adjourn any meeting to another
time and place. Notice of any adjournment of a meeting
to another time or place shall be given, in the manner
described above, to the directors who were not present at
the time of the adjournment and, unless such time and
place are announced at the meeting, to the other
directors.
Section 5.1. Participation in Meetings of the Board
or Committees Thereof by Means of Telephone or Similar Equipment.
Any one or more members of the Board of Directors, the
Executive Committee, or any other Committee of the Board
may participate in a meeting of such Board or Committee
by means of a conference telephone or similar
communications equipment allowing all persons
participating in the meeting to hear each other at the
same time. Participation by such means shall constitute
presence in person at a meeting.
Section 5.2. Action of the Board or
Committees Thereof by Unanimous Written Consent. Any
action required or permitted to be taken by the Board of
Directors, the Executive Committee, or any other
Committee of the Board of Directors may be taken without
a meeting if all members of the Board or of the Committee
consent in writing to the adoption of a resolution
authorizing the action. The resolution and the written
consents thereto by the members of the Board or Committee
shall be filed with the minutes of the proceedings of the
Board or Committee.
Section 6. Resignations. Any director of
the Corporation may resign at any time by giving written
notice to the Board of Directors or to the Chairman or
the Secretary of the Corporation. Such resignation shall
take effect at the time specified therein; and unless
otherwise specified therein the acceptance of such
resignation shall not be necessary to make it effective.
Section 7. Removal of Directors. Any or
all of the directors may be removed, with or without
cause, by the holders of a majority of the shares then
entitled to vote at an election of directors at a meeting
of the stockholders or by the unanimous written consent
of all stockholders entitled to vote.
Section 8. Newly Created Directorships and Vacancies.
Newly created directorships resulting from an increase in the
number of directors and vacancies occurring in the Board of
Directors for any reason may be filled by vote of a
majority of the directors then in office, although less
than a quorum exists. A director elected to fill a
vacancy shall be elected to hold office for the unexpired
term of his predecessor.
Section 9. Compensation of Directors. The
Board of Directors shall have authority to fix the
compensation of directors for services in any capacity.
Section 10. Indemnification.
(a) General Indemnification. Each person
who was or is made a party or is threatened to be made a
party to or is involved in any action, suit or
proceeding, whether civil, criminal, administrative or
investigative, and any appeal therefrom (hereinafter,
collectively, a "proceeding"), by reason of the fact that
he or she, or a person of whom he or she is the legal
representative, is, was or had agreed to become a
director of the Corporation or is, was or had agreed to
become an officer of the Corporation or is or was serving
at the request of the Corporation as a director, officer,
employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise,
including service with respect to employee benefit plans,
shall be indemnified and held harmless by the Corporation
to the fullest extent permitted under the General
Corporation Law of the State of Delaware (the "DGCL"), as
the same now exists or may hereafter be amended (but, in
the case of any such amendment, only to the extent that
such amendment permits the Corporation to provide broader
indemnification rights than the DGCL permitted the
Corporation to provide prior to such amendment), against
all expenses, liabilities and losses (including
attorneys' fees, judgments, fines, excise taxes or
penalties and amounts paid or to be paid in settlement)
reasonably incurred or suffered by such person in
connection therewith; provided, that a person seeking
indemnity in connection with a proceeding (or part
thereof) initiated by such person against the Corporation
or any director, officer, employee or agent of the
Corporation shall not be entitled to the foregoing
indemnification unless the Corporation has joined in or
consented to such proceeding (or part thereof).
(b) Expenses. Expenses, including
attorneys' fees, incurred by a person referred to in
paragraph (a) of this Section 10 in defending or
otherwise being involved in a proceeding shall be paid by
the Corporation in advance of the final disposition of
such proceeding, including any appeal therefrom, upon
receipt of an undertaking (the "Undertaking") by or on
behalf of such person to repay such amount if it shall
ultimately be determined that he or she is not entitled
to be indemnified by the Corporation.
(c) Non-Exclusivity of Rights. The rights
conferred on any person by this Section 10 shall not be
exclusive of any other right which such person may have
or hereafter acquire under any statute, provision of the
Certificate of Incorporation, By-Law, agreement, vote of
stockholders or disinterested directors or otherwise.
The Board of Directors shall have the authority, by
resolution, to provide for such other indemnification of
directors, officers, employees or agents as it shall deem
appropriate.
(d) Insurance. The Corporation may
purchase and maintain insurance to protect itself and any
director, officer, employee or agent of the Corporation
or another corporation, partnership, joint venture, trust
or other enterprise against any expenses, liabilities or
losses, whether or not the Corporation would have the
power to indemnify such person against such expenses,
liabilities or losses under the DGCL.
(e) Enforceability. The provisions of
this Section 10 shall be applicable to all proceedings
commenced after its adoption, whether such arise out of
events, acts, omissions or circumstances which occurred
or existed prior or subsequent to such adoption, and
shall continue as to a person who has ceased to be a
director or officer and shall inure to the benefit of the
heirs, executors and administrators of such person. This
Section 10 shall be deemed to grant each person who, at
any time that this Section 10 is in effect, serves or
agrees to serve in any capacity which entitles him or her
to indemnification hereunder rights against the
Corporation to enforce the provisions of this Section 10,
and any repeal or other modification of this Section 10
or any repeal or modification of the DGCL or any other
applicable law shall not limit any rights of
indemnification then existing or arising out of events,
acts, omissions or circumstances occurring or existing
prior to such repeal or modification, including, without
limitation, the right to indemnification for proceedings
commenced after such repeal or modification to enforce
this Section 10 with regard to acts, omissions, events or
circumstances occurring or existing prior to such repeal
or modification.
(f) Severability. If this Section 10 or
any portion hereof shall be invalidated on any ground by
any court of competent jurisdiction, then the Corporation
shall nevertheless indemnify each director and officer of
the Corporation as to costs, charges and expenses
(including attorneys' fees), judgments, fines and amounts
paid in settlement with respect to any proceeding,
whether civil, criminal, administrative or investigative,
including an action by or in the right of the
Corporation, to the full extent permitted by any
applicable portion of this Section 10 that shall not have
been invalidated and to the full extent permitted by
applicable law.
Section 11. Executive Committee. The Board
of Directors, by resolution adopted by a majority of the
entire Board, may designate from among its members an
Executive Committee, consisting of four or more
directors, which shall have all the authority of the
Board, except that the Executive Committee shall have no
authority as to the following matters:
(1) Amending the Certificate of
Incorporation;
(2) Adopting an agreement of merger or
consolidation;
(3) Recommending to the stockholders the
sale, lease or exchange of all or
substantially all of the Corporation's
property and assets;
(4) Recommending to the stockholders a
dissolution of the Corporation or a
revocation of a dissolution;
(5) Amending the By-Laws of the
Corporation;
(6) Declaring a dividend; or
(7) Authorizing the issuance of stock.
The Board of Directors may designate one or
more directors (who may or may not be officers and
employees of the Corporation) as alternate members of the
Executive Committee, who may replace any absent member or
members for all purposes, including the constituting of a
quorum at any meeting of such Committee.
Three members of the Executive Committee shall
constitute a quorum for the transaction of business, and
the vote of a majority of the members present at a
meeting at the time of such vote if a quorum is then
present, shall be the act of such Committee. Meetings of
the Executive Committee may be called by any member of
the Executive Committee, and notices thereof shall be
given to each member of the Executive Committee in the
same manner as notices to directors are provided for in
the case of notices of special meetings of the Board of
Directors, but notice may in any case be waived.
The Executive Committee shall serve at the
pleasure of the Board of Directors.
Section 12. Audit and Finance Committee.
The Audit and Finance Committee of the Board of Directors
will consist of three or more directors, none of whom
shall be an officer or employee of the Corporation. The
number of members of the Committee will be determined
each year at the annual meeting of the Board of
Directors.
The Audit and Finance Committee will maintain,
through regularly scheduled meetings, communications
between the directors and independent accountants and
will provide assistance to the Board in fulfilling its
fiduciary and statutory responsibilities related to
corporate accounting, integrity of financial controls,
and reporting practices. The Committee will also review
the financial policies and procedures of the Corporation
and oversee and make recommendations to the Board
concerning the Corporation's investment and dividend
policies and methods of financing corporate operations.
The Committee will also have overall oversight
responsibility for the investment and management of the
assets of the Corporation's pension plans, the
appointment of investment managers and plan trustees and
the operation of the various benefits committees. The
Committee will make periodic reports to the entire Board
on such matters as the Committee or the Board may
specify.
Section 13. Compensation and Stock Option Committee.
The Compensation and Stock Option Committee of the Board of
Directors will consist of three or more directors, none
of whom shall be an officer or employee of the
Corporation. The number of members of the Committee will
be determined each year at the annual meeting of the
Board of Directors.
The Compensation and Stock Option Committee
will exercise the full powers of the entire Board with
respect to fixing the compensation to be paid from time
to time to all officers and employees of the Corporation
and its subsidiaries whose compensation is above the
minimum level determined by the Committee from time to
time to be appropriate for control by directors of the
Corporation. The Committee will also grant all stock
options and make other determinations necessary or
advisable for the administration of all stock option
plans and similar plans. The Committee will make
periodic reports to the entire Board on such matters as
the Committee or the Board may specify.
Section 14. Nominating and Governance
Committee. The Nominating and Governance Committee of
the Board of Directors will consist of three or more
directors. The number of members of the Committee will
be determined each year at the annual meeting of the
Board of Directors.
The Nominating and Governance Committee will
review and make recommendations to the entire Board
concerning the qualifications and selection of candidates
for election as directors and officers of the
Corporation. The Committee will also advise and make
recommendations to the Board on all matters pertaining to
directorship and corporate governance practices and the
Corporation's position and practices on significant
issues of corporate public responsibility.
Section 15. Management Operations Committee.
The Management Operations Committee of the Board of
Directors will consist of one or more directors, each of
whom shall also be an employee or officer of the
Corporation. The Board of Directors shall establish from
time to time by resolution the composition, functions and
responsibilities of the Management Operations Committee.
Section 16. Other Committees. The Board of
Directors, by resolution adopted by a majority of the
entire Board, may designate from among its members
committees other than those described in the foregoing
By-Laws. Any such Committee of which a majority of the
members shall not be officers or employees of the
Corporation may be authorized by the resolution
establishing it to have all of the authority of the Board
with respect to matters delegated to it by said
resolution. No resolution establishing and delegating
authority to a committee pursuant to this section shall
confer authority as to any of the matters listed in
Section 11 of this Article, Paragraphs (1) - (6)
inclusive.
ARTICLE III
OFFICERS
Section 1. Officers. The officers of the
Corporation shall consist of a Chairman, a President, a
Secretary and a Treasurer. In addition, the Board of
Directors may elect one or more Executive Vice
Presidents, Senior Vice Presidents, or Vice Presidents, a
General Counsel, a Controller, Assistant Secretaries,
Assistant Treasurers, Assistant General Counsels, group
officers, divisional officers and such other officers as
the Board of Directors may determine, and the respective
provisions of these By-Laws with respect to the duties
and powers of such additional officers shall be
applicable only during any time such additional officers
shall be elected and acting. The Chairman shall be a
member of the Board of Directors. Other officers of the
Corporation may, but need not, be members of the Board of
Directors. Any two or more offices may be held by the
same person, except the offices of Chairman and
Secretary, or President and Secretary.
Section 2. Term of Office and Removal. All
officers of the Corporation shall be elected annually by
the Board of Directors as soon as may be practicable
after the annual election of directors. Vacancies may be
filled, or new offices created and filled, at any meeting
of the Board of Directors. Each officer elected by the
Board of Directors shall hold office for the term for
which he is elected, and until his successor has been
elected and qualified. Unless otherwise provided in the
resolution of the Board of Directors electing an officer,
his term of office shall extend to and expire at the
meeting of the Board following the next annual meeting of
stockholders. Any officer may be removed by the Board,
with or without cause, at any time. Removal of an
officer without cause shall be without prejudice to his
contract rights, if any, and the election of an officer
shall not of itself create contract rights.
Section 3. Powers and Duties. The officers
of the Corporation shall have such authority and perform
such duties in the management of the Corporation, as may
be prescribed in these By-Laws or by the Board of
Directors and, to the extent not so prescribed, they
shall have such authority and perform such duties in the
management of the Corporation, subject to the control of
the Board, as generally pertain to their respective
offices. Securities of other corporations held by the
Corporation may be voted by any officer designated by the
Board and, in the absence of any such designation, by the
Chairman, the President, any Vice President, the
Secretary or the Treasurer. The Board may require any
officer, agent or employee to give security for the
faithful performance of his duties.
Section 4. Books to be Kept. The
Corporation shall keep (a) correct and complete books and
records of account, (b) minutes of the proceedings of the
stockholders, Board of Directors, Executive Committee and
any other committees of directors, and (c) a current list
of the directors and officers and their residence
addresses; and the Corporation shall also keep at its
office in the State of Illinois, or at the office of its
transfer agent or registrar in the State of Illinois, if
any, a record containing the names and addresses of all
stockholders, the number and class of shares held by each
and the dates when they respectively became the owners of
record thereof.
The Board of Directors may determine whether
and to what extent and at what times and places and under
what conditions and regulations any accounts, books,
records or other documents of the Corporation, other than
the stock ledger and list of stockholders, shall be open
to inspection, and no creditor, security holder or other
person shall have any right to inspect any accounts,
books, records or other documents of the Corporation
except as conferred by the Statute or as so authorized by
the Board or an officer of the Corporation.
Section 5. Checks, Notes, etc. All checks
and drafts on, and withdrawals from, the Corporation's
accounts with banks or other financial institutions, and
all bills of exchange, notes and other instruments for
the payment of money, drawn, made, indorsed, or accepted
by the Corporation, shall be signed on its behalf by the
person or persons thereunto authorized by, or pursuant to
resolution of, the Board of Directors.
ARTICLE IV
DUTIES OF OFFICERS
Section 1. Chairman. The Chairman shall
preside at all meetings of the stockholders and of the
Board of Directors, and shall have such other duties and
powers as may be assigned to him by the Board of
Directors or the Executive Committee.
Section 2. President. The President shall
have such duties and powers as may be assigned to him by
the Board of Directors or the Executive Committee. In
the absence of the Chairman, he shall preside at meetings
of the stockholders and of the Board of Directors.
Section 3. Vice Presidents. The Vice
Presidents, which shall include any Executive Vice
Presidents or Senior Vice Presidents, shall have such
duties and powers as may be assigned to them by the
Chairman, the President, the Board of Directors or the
Executive Committee.
Section 4. Secretary. The Secretary shall:
(a) keep the minutes of meetings of the stockholders, the
Board of Directors and the Executive Committee in one or
more books provided for that purpose; (b) see that all
notices are duly given in accordance with the provisions
of these By-Laws or as required by law; (c) be custodian
of the corporate record books and of the seal of the
Corporation, and see that the seal of the Corporation is
affixed to all documents, the execution of which on
behalf of the Corporation under its seal is duly
authorized in accordance with the provisions of these By-
Laws; and (d) in general perform all duties incident to
the office of the Secretary and such other duties as from
time to time may be assigned to him by the Board of
Directors, the Executive Committee, the Chairman or the
President.
Section 5. General Counsel. The General
Counsel shall give legal counsel and advice to the Board
of Directors and its committees. He shall be the chief
attorney at law for the Corporation and its subsidiaries,
shall be the head of the Corporation's Legal Department,
and shall select, engage and approve payment of fees to
attorneys retained to represent the Corporation or its
subsidiaries in litigation or otherwise.
Section 6. Treasurer. The Treasurer shall
have charge and custody of all funds and securities of
the Corporation. He shall deposit or invest all monies
and other valuable effects of the Corporation in the name
and to the credit of the Corporation in such depositories
as may be designated by the Board of Directors or the
Executive Committee or in such short-term investments as
he shall select with the approval of the Chairman or the
President. He shall disburse funds of the Corporation as
may be ordered by the Board of Directors or the Executive
Committee, taking proper vouchers for such disbursements.
He shall render to the Chairman, the President, the Board
of Directors and the Executive Committee, whenever any
thereof may require it, an account of his transactions as
Treasurer and of the financial position of the
Corporation.
Section 7. Controller. The Controller
shall be the chief accounting officer of the Corporation.
He shall, when proper, approve all bills for purchases,
payrolls and similar instruments providing for
disbursement of money by the Corporation, for payment by
the Treasurer. He shall be in charge of and maintain
books of account and accounting records of the
Corporation. He shall perform such other acts as are
usually performed by the controller of a corporation. He
shall render to the Chairman, the President, the Board of
Directors and the Executive Committee, such reports as
any thereof may require.
Section 8. Assistant Secretaries, Assistant
Treasurers and Assistant General Counsels. The Assistant
Secretaries, Assistant Treasurers and Assistant General
Counsels shall have such duties and powers as may be assigned
by the Secretary, the Treasurer or the General Counsel
respectively, or by the Chairman, the President, the Board
of Directors or the Executive Committee.
Section 9. Divisional and Group Officers.
The divisional officers and group officers shall have
such duties and powers with respect to their divisions or
groups as may be assigned to them by the Chairman, the
President, the Board of Directors or the Executive
Committee.
ARTICLE V
FORMS OF CERTIFICATES AND LOSS
AND TRANSFER OF STOCK
Section 1. Forms of Stock Certificates.
The shares of stock of the Corporation shall be
represented by certificates, in such forms as the Board
of Directors may prescribe, signed by the Chairman, the
President or a Vice President, and the Secretary, an
Assistant Secretary, the Treasurer or an Assistant
Treasurer, and may be sealed with the seal of the
Corporation or a facsimile thereof. The signatures of
the officers upon a certificate may be facsimiles if the
certificate is countersigned by a transfer agent or
registered by a registrar other than the Corporation or
its employee. In case any officer who has signed or
whose facsimile signature has been placed upon a
certificate shall have ceased to be such officer before
such certificate is issued, it may be issued by the
Corporation with the same effect as if he were such
officer at the date of issue.
Each certificate representing shares of stock
shall state upon the face thereof:
(1) That the Corporation is formed under
the laws of the State of Delaware;
(2) The name of the person or persons to
whom issued; and
(3) The number and class of stock, and the
designation of the series, if any,
which such certificate represents.
Section 2. Transfers of Stock. Shares of
stock of the Corporation shall be transferable on the
stock ledger upon presentment to the Corporation or a
transfer agent of a certificate or certificates
representing the shares of stock requested to be
transferred, with proper endorsement on the certificate
or on a separate accompanying document, together with
such evidence of the payment of transfer taxes and
compliance with other provisions of law as the
Corporation or its transfer agent may require.
Section 3. Lost, Stolen or Destroyed Stock
Certificates. No certificate for shares of stock of the
Corporation shall be issued in place of any certificate
alleged to have been lost, destroyed or wrongfully taken,
except if and to the extent required by the Board of
Directors, upon:
(1) Production of evidence of loss,
destruction or wrongful taking;
(2) Delivery of a bond indemnifying the
Corporation and its agents against any
claim that may be made against it or
them on account of the alleged loss,
destruction or wrongful taking of the
replaced certificate or the issuance
of the new certificate; and
(3) Compliance with such other reasonable
requirements as may be imposed.
ARTICLE VI
OTHER MATTERS
Section 1. Corporate Seal. The Board of
Directors may adopt a corporate seal, alter such seal at
pleasure, and authorize it to be used by causing it or a
facsimile to be affixed or impressed or reproduced in any
other manner.
Section 2. Fiscal Year. The fiscal year of
the Corporation shall begin on the first day of December
in each year and end on the thirtieth day of November in
each year.
Section 3. Amendments. By-Laws of the
Corporation may be adopted, amended or repealed by vote
of the holders of the shares of stock at the time
entitled to vote in the election of any directors. By-
Laws may also be adopted, amended or repealed by the
Board of Directors, but any By-Law adopted by the Board
may be amended or repealed by the stockholders entitled
to vote thereon as hereinabove provided.
If any By-Law regulating an impending election
of directors is adopted, amended or repealed by the Board
of Directors, there shall be set forth in the notice of
the next meeting of stockholders for the election of
directors the By-Law so adopted, amended or repealed,
together with a concise statement of the changes made.
HARTMARX CORPORATION
and
First Chicago Trust Company of New York
Rights Agent
Rights Agreement
Dated as of December 6, 1995
Table of Contents
Section Page
1. Certain Definitions . . . . . . . . . . . . 1
2. Appointment of Rights Agent . . . . . . . . 6
3. Issue of Rights Certificates . . . . . . . 6
4. Form of Rights Certificates . . . . . . . . 9
5. Countersignature and Registration . . . . . 10
6. Transfer, Split Up, Combination and
Exchange of Rights Certificates;
Mutilated, Destroyed, Lost or Stolen
Rights Certificates . . . . . . . . . . . 11
7. Exercise of Rights; Purchase Price;
Expiration Date of Rights . . . . . . . . 12
8. Cancellation and Destruction of Rights
Certificates . . . . . . . . . . . . . . . 15
9. Reservation and Availability of Capital
Stock . . . . . . . . . . . . . . . . . . 15
10. Preferred Stock Record Date . . . . . . . 18
11. Adjustment of Purchase Price, Number and
Kind of Shares or Number of Rights . . . 18
12. Certificate of Adjusted Purchase Price or
Number of Shares . . . . . . . . . . . . 31
13. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power . . . . . . . 31
14. Fractional Rights and Fractional Shares . 35
15. Rights of Action . . . . . . . . . . . . . 37
16. Agreement of Rights Holders . . . . . . . 37
17. Rights Certificate Holder Not Deemed a
Stockholder . . . . . . . . . . . . . . . 38
18. Concerning the Rights Agent . . . . . . . 39
19. Merger or Consolidation or Change of Name
of Rights Agent . . . . . . . . . . . . . 39
20. Duties of Rights Agent . . . . . . . . . . 40
21. Change of Rights Agent . . . . . . . . . . 43
22. Issuance of New Rights Certificates . . . 44
23. Redemption and Termination . . . . . . . . 45
24. Notice of Certain Events . . . . . . . . . 46
25. Notices . . . . . . . . . . . . . . . . . 48
26. Supplements and Amendments . . . . . . . . 48
27. Successors . . . . . . . . . . . . . . . . 49
28. Determinations and Actions by the Board of
Directors, etc. . . . . . . . . . . . . . 49
29. Benefits of this Agreement . . . . . . . . 50
30. Severability . . . . . . . . . . . . . . . 50
31. Governing Law . . . . . . . . . . . . . . 51
32. Counterparts . . . . . . . . . . . . . . . 51
33. Descriptive Headings . . . . . . . . . . . 51
Exhibit A -- Certificate of Designation, Preferences and Rights
Exhibit B -- Form of Rights Certificate
RIGHTS AGREEMENT
RIGHTS AGREEMENT, dated as of December 6, 1995
(the "Agreement"), between Hartmarx Corporation, a
Delaware corporation (the "Company"), and First Chicago
Trust Company of New York, a New York corporation (the
"Rights Agent").
W I T N E S S E T H
WHEREAS, on December 6, 1995 (the "Rights
Dividend Declaration Date"), the Board of Directors of
the Company authorized and declared a dividend
distribution of one Right for each share of common stock,
par value $2.50 per share, of the Company (the "Common
Stock") outstanding at the close of business on January
31, 1996 (the "Record Date"), and has authorized the
issuance of one Right (as such number may hereinafter be
adjusted pursuant to the provisions of Section 11(p)
hereof) for each share of Common Stock of the Company
issued between the Record Date (whether originally issued
or delivered from the Company's treasury) and the
Distribution Date each Right initially representing the
right to purchase one one-thousandth of a share of Series
A Junior Participating Preferred Stock (the "Preferred
Stock") of the Company having the rights, powers and
preferences set forth in the form of Certificate of
Designation, Preferences and Rights attached hereto as
Exhibit A, upon the terms and subject to the conditions
hereinafter set forth (the "Rights");
NOW, THEREFORE, in consideration of the
premises and the mutual agreements herein set forth, the
parties hereby agree as follows:
Section 1. Certain Definitions. For purposes
of this Agreement, the following terms have the meanings
indicated:
(a) "Acquiring Person" shall mean any
Person who or which, 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 (i) the Company, (ii)
any Subsidiary of the Company, (iii) any employee benefit
plan of the Company or of any Subsidiary of the Company,
(iv) any Person or entity organized, appointed or
established by the Company for or pursuant to the terms
of any such plan, (v) any such Person who has reported or
is required to report such ownership (but less than 25%)
on Schedule 13G under the Exchange Act (or any comparable
or successor report) or on Schedule 13D under the
Exchange Act (or any comparable or successor report)
which Schedule 13D does not state any intention to or
reserve the right to control or influence the management
or policies of the Company or engage in any of the
actions specified in Item 4 of such Schedule (other than
the disposition of the Common Stock) and, within 10
Business Days of being requested by the Company to advise
it regarding the same, certifies to the Company that such
Person acquired shares of Common Stock in excess of 14.9%
inadvertently or without knowledge of the terms of the
Rights and who, together with all Affiliates and
Associates, thereafter does not acquire additional shares
of Common Stock while the Beneficial Owner of 15% or more
of the shares of Common Stock then outstanding; provided,
however, that if the Person requested to so certify fails
to do so within 10 Business Days, then such Person shall
become an Acquiring Person immediately after such 10
Business Day Period or (vi) Traco International, N.V.
("Traco") or any of its Affiliates that, during the
Agreement Period (as defined in the Stockholder's
Agreement, dated September 20, 1992, between Traco and
the Company (the "Stockholder Agreement")), agree in
writing to be bound by the provisions of the
Stockholder's Agreement in accordance with the provisions
of the Stockholder's Agreement (each of Traco and such
Affiliates, a "Traco Stockholder," and together, the
"Traco Stockholders"), if and so long as neither Traco
nor any of its Affiliates has become or agreed to become
the Beneficial Owner of any Common Stock other than (1)
pursuant to the Securities Purchase Agreement, dated
September 20, 1992, between the Company and Traco (the
"Securities Purchase Agreement"), (2) during the
Agreement Period under the Stockholder's Agreement, as
specifically permitted by the Stockholder's Agreement,
(3) pursuant to employee benefit plans of the Company or
(4) as a result of a stock split, stock dividend or other
distribution of any securities of the Company to its
stockholders generally. Acquisition of Beneficial
Ownership of Common Stock pursuant to clauses (1) through
(4) above are referred to herein as "Permitted Traco
Purchases." Notwithstanding the foregoing, no Person
shall become an "Acquiring Person" solely as the result
of an acquisition of Common Stock by the Company which,
by reducing the number of shares outstanding, increases
the proportionate number of shares beneficially owned by
a Person to 15% or more of the Common Stock of the
Company then outstanding as determined above; provided,
however, that if a Person becomes the Beneficial Owner of
15% or more of the Common Stock of the Company then
outstanding (as determined above) solely by reason of
purchases of Common Stock by the Company and shall, after
such purchases by the Company, become the Beneficial
Owner of any additional shares of Common Stock by any
means whatsoever, then such Person shall be deemed to be
an "Acquiring Person."
(b) "Affiliate" and "Associate" shall
have the respective meanings ascribed to such terms in
Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as amended and in effect
on the date of this Agreement (the "Exchange Act").
(c) A Person shall be deemed the
"Beneficial Owner" of, and shall be deemed to
"beneficially own," any securities:
(i) which such Person or any of
such Person's Affiliates or Associates,
directly or indirectly, has the right to
acquire (whether such right is exercisable
immediately or only after the passage of time)
pursuant to any agreement, arrangement or
understanding (whether or not in writing) or
upon the exercise of conversion rights,
exchange rights, rights, warrants or options,
or otherwise; provided, however, that a Person
shall not be deemed the "Beneficial Owner" of,
or to "beneficially own," (A) securities
tendered pursuant to a tender or exchange offer
made by such Person or any of such Person's
Affiliates or Associates until such tendered
securities are accepted for purchase or
exchange, or (B) securities issuable upon
exercise of Rights at any time prior to the
occurrence of a Triggering Event, or (C)
securities issuable upon exercise of Rights
from and after the occurrence of a Triggering
Event which Rights were acquired by such Person
or any of such Person's Affiliates or
Associates prior to the Distribution Date or
pursuant to Section 3(a) or Section 22 hereof
(the "Original Rights") or pursuant to Section
11(i) hereof in connection with an adjustment
made with respect to any Original Rights;
(ii) which such Person or any of
such Person's Affiliates or Associates,
directly or indirectly, has the right to vote
or dispose of or has "beneficial ownership" of
(as determined pursuant to Rule 13d-3 of the
General Rules and Regulations under the
Exchange Act), including pursuant to any
agreement, arrangement or understanding,
whether or not in writing; provided, however,
that a Person shall not be deemed the
"Beneficial Owner" of, or to "beneficially
own," any security under this subparagraph (ii)
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 given in
response to a public proxy or consent
solicitation made pursuant to, and in
accordance with, the applicable provisions of
the General 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
(iii) which are beneficially owned,
directly or indirectly, by any other Person (or
any Affiliate or Associate thereof) with which
such Person (or any of such Person's Affiliates
or Associates) has any agreement, arrangement
or understanding (whether or not in writing),
for the purpose of acquiring, holding, voting
(except pursuant to a revocable proxy as
described in the proviso to subparagraph (ii)
of this paragraph (c)) or disposing of any
voting securities of the Company; provided,
however, that nothing in this paragraph (c)
shall cause a person engaged in business as an
underwriter of securities to be the "Beneficial
Owner" of, or to "beneficially own," any
securities acquired through such person's
participation in good faith in a firm
commitment underwriting until the expiration of
forty days after the date of such acquisition.
(d) "Business Day" shall mean any day
other than a Saturday, Sunday or a day on which banking
institutions in the State of Illinois are authorized or
obligated by law or executive order to close.
(e) "Close of business" on any given date
shall mean 5:00 P.M., Chicago time, on such date;
provided, however, that if such date is not a Business
Day it shall mean 5:00 P.M., Chicago time, on the next
succeeding Business Day.
(f) "Common Stock" shall mean the common
stock, par value $2.50 per share, of the Company, except
that "Common Stock" when used with reference to any
Person other than the Company shall mean 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.
(g) "Continuing Director" shall mean (i)
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 of an Acquiring
Person or of any such Affiliate or Associate, and was a
member of the Board prior to the date of this Agreement,
or (ii) any Person who subsequently becomes a member of
the Board, 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 of
an Acquiring Person or of any such Affiliate or
Associate, if such Person's nomination for election or
election to the Board is recommended or approved by a
majority of the Continuing Directors.
(h) "Person" shall mean any individual,
firm, corporation, partnership or other entity.
(i) "Preferred Stock" shall mean shares
of Series A Junior Participating Preferred Stock, par
value $1.00 per share, of the Company, and, to the extent
that there are not a sufficient number of shares of
Series A Junior Participating Preferred Stock authorized
to permit the full exercise of the Rights, any other
series of Preferred Stock, par value $1.00 per share, of
the Company designated for such purpose containing terms
substantially similar to the terms of the Series A Junior
Participating Preferred Stock.
(j) "Section 11(a)(ii) Event" shall mean
any event described in Section 11(a)(ii) hereof.
(k) "Section 13 Event" shall mean any
event described in clauses (x), (y) or (z) of Section
13(a) hereof.
(l) "Stock Acquisition Date" shall mean
the first date of public announcement (which, for
purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 13(d)
under the Exchange Act) by the Company or an Acquiring
Person that an Acquiring Person has become such.
(m) "Subsidiary" shall mean, with
reference to any Person, any corporation of which an
amount of voting securities sufficient to elect at least
a majority of the directors of such corporation is
beneficially owned, directly or indirectly, by such
Person, or otherwise controlled by such Person.
(n) "Triggering Event" shall mean any
Section 11(a)(ii) Event or any Section 13 Event.
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 (who, in
accordance with Section 3 hereof, shall prior to the
Distribution Date also be the holders of the Common
Stock) in accordance with the terms and conditions
hereof, and the Rights Agent hereby accepts such
appointment. The Company may from time to time appoint
such Co-Rights Agents as it may deem necessary or
desirable.
Section 3. Issue of Rights Certificates.
(a) Until the earliest of (i) the close
of business on the tenth day after the Stock Acquisition
Date (or, if the tenth day after the Stock Acquisition
Date occurs before the Record Date, the close of business
on the Record Date) or (ii) the close of business on the
tenth business day (or such later date as the Board shall
determine) after the date that a tender or exchange offer
by any Person (other than the Company, any Subsidiary of
the Company, any employee benefit plan of the Company or
of any Subsidiary of the Company, or any Person or entity
organized, appointed or established by the Company for or
pursuant to the terms of any such plan) is first
published or sent or given within the meaning of Rule
14d-2(a) of the General Rules and Regulations under the
Exchange Act, if upon consummation thereof, such Person
would be the Beneficial Owner of 15% or more of the
shares of Common Stock then outstanding (the earlier of
(i) and (ii) being herein referred to as the
"Distribution Date"), (x) the Rights will be evidenced
(subject to the provisions of paragraph (b) of this
Section 3) by the certificates for the Common Stock
registered in the names of the holders of the Common
Stock (which certificates for Common Stock shall be
deemed also to be certificates for Rights) and not by
separate certificates, and (y) the Rights will be
transferable only in connection with the transfer of the
underlying shares of Common Stock (including a transfer
to the Company). As soon as practicable after 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, in substantially the form of Exhibit
B hereto (the "Rights Certificates"), evidencing one
Right for each share of Common Stock so held, subject to
adjustment as provided herein. In the event that an
adjustment in the number of Rights per share of Common
Stock has been made pursuant to Section 11(p) hereof, at
the time of distribution of the Rights Certificates, the
Company shall make the necessary and appropriate rounding
adjustments (in accordance with Section 14(a) hereof) so
that Rights Certificates representing only whole numbers
of Rights are distributed and cash is paid in lieu of any
fractional Rights. As of and after the Distribution
Date, the Rights will be evidenced solely by such Rights
Certificates.
(b) With respect to certificates for the
Common Stock outstanding as of the Record Date, until the
Distribution Date, the Rights will be evidenced by such
certificates for the Common Stock and the registered
holders of the Common Stock shall also be the registered
holders of the associated Rights. Until the earlier of
the Distribution Date or the Expiration Date (as such
term is defined in Section 7 hereof), the transfer of any
certificates representing shares of Common Stock in
respect of which Rights have been issued shall also
constitute the transfer of the Rights associated with
such shares of Common Stock.
(c) Rights shall be issued in respect of
all shares of Common Stock which are issued (whether
originally issued or from the Company's treasury) after
the Record Date but prior to the earlier of the
Distribution Date or the Expiration Date or in certain
circumstances provided in Section 22 hereof, after the
Distribution Date. Certificates representing such shares
of Common Stock shall also be deemed to be certificates
for Rights, and shall bear the following legend:
This certificate also evidences and
entitles the holder hereof to certain Rights as
set forth in the Rights Agreement between
Hartmarx Corporation (the "Company") and First
Chicago Trust Company of New York (the "Rights
Agent") dated as of December 6, 1995, as
amended from time to time (the "Rights
Agreement"), the terms of which are hereby
incorporated herein by reference and a copy of
which is on file at the principal offices of
Hartmarx Corporation. Under certain
circumstances, as set forth in the Rights
Agreement, such Rights will be evidenced by
separate certificates and will no longer be
evidenced by this certificate. Hartmarx
Corporation will mail to the holder of this
certificate a copy of the Rights Agreement, as
in effect on the date of mailing, without
charge promptly after receipt of a written
request therefor. Under certain circumstances
set forth in the Rights Agreement, Rights
issued to, or held by, any Person who is, was
or becomes an Acquiring Person or any 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 become null and void.
With respect to such certificates containing the
foregoing legend, until the earlier of (i) the
Distribution Date or (ii) the Expiration Date, the Rights
associated with the Common Stock represented by such
certificates shall be evidenced by such certificates
alone and registered holders of Common Stock shall also
be the registered holders of the associated Rights, and
the transfer of any of such certificates shall also
constitute the transfer of the Rights associated with the
Common Stock represented by such certificates.
Section 4. Form of Rights Certificates.
(a) The Rights Certificates (and the
forms of election to purchase and of assignment to be
printed on the reverse thereof) shall each be
substantially in the form set forth in Exhibit B hereto
and may have such marks of identification or designation
and such legends, summaries or endorsements printed
thereon as the Company may deem appropriate and as are
not inconsistent with the provisions of this Agreement,
or as may be required to comply with any applicable law
or with any rule or regulation made pursuant thereto or
with any rule or regulation of any stock exchange on
which the Rights may from time to time be listed, or to
conform to usage. Subject to the provisions of Section
11 and Section 22 hereof, the Rights Certificates,
whenever distributed, shall be dated as of the Record
Date and on their face shall entitle the holders thereof
to purchase such number of one one-thousandths of a share
of Preferred Stock as shall be set forth therein at the
price set forth therein (such exercise price per one
one-thousandth of a share, the "Purchase Price"), but the
amount and type of securities purchasable upon the
exercise of each Right and the Purchase Price thereof
shall be subject to adjustment as provided herein.
(b) Any Rights Certificate issued
pursuant to Section 3(a) or Section 22 hereof that
represents Rights beneficially owned by: (i) an
Acquiring Person or any Associate or Affiliate of an
Acquiring Person, (ii) a transferee of an Acquiring
Person (or of any such Associate or Affiliate) who
becomes a transferee after the Acquiring Person becomes
such, or (iii) a transferee of an Acquiring Person (or of
any such Associate or Affiliate) who becomes a transferee
prior to or concurrently with the Acquiring Person
becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from
the Acquiring Person to holders of equity interests in
such Acquiring Person or to any Person with whom such
Acquiring Person has any continuing agreement,
arrangement or understanding regarding the transferred
Rights or (B) a transfer which the Board of Directors of
the Company has determined is part of a plan, arrangement
or understanding which has as a primary purpose or effect
avoidance of Section 7(e) hereof, and any Rights
Certificate issued pursuant to Section 6 or Section 11
hereof upon transfer, exchange, replacement or adjustment
of any other Rights Certificate referred to in this
sentence, shall contain (to the extent feasible) the
following legend:
The Rights represented by this Rights
Certificate are or were beneficially owned by a
Person who was or became an Acquiring Person or
an Affiliate or Associate of an Acquiring
Person (as such terms are defined in the Rights
Agreement). Accordingly, this Rights
Certificate and the Rights represented hereby
may become null and void in the circumstances
specified in Section 7(e) of such Agreement.
Section 5. Countersignature and Registration.
(a) The Rights 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 Rights Certificates shall be
countersigned by the Rights Agent, either manually or by
facsimile signature and shall not be valid for any
purpose unless so countersigned. In case any officer of
the Company who shall have signed any of the Rights
Certificates shall cease to be such officer of the
Company before countersignature by the Rights Agent and
issuance and delivery by the Company, such Rights
Certificates, nevertheless, may be countersigned by the
Rights Agent and issued and delivered by the Company with
the same force and effect as though the person who signed
such Rights Certificates had not ceased to be such
officer of the Company; and any Rights Certificates may
be signed on behalf of the Company by any person who, at
the actual date of the execution of such Rights
Certificate, shall be a proper officer of the Company to
sign such Rights 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 appropriate
place for surrender of Rights Certificates upon exercise
or transfer, books for registration and transfer of the
Rights Certificates issued hereunder. Such books shall
show the names and addresses of the respective holders of
the Rights Certificates, the number of Rights evidenced
on its face by each of the Rights Certificates and the
date of each of the Rights Certificates.
Section 6. Transfer, Split Up, Combination and
Exchange of Rights Certificates; Mutilated, Destroyed,
Lost or Stolen Rights Certificates. (a) Subject to the
provisions of Section 4(b), Section 7(e) and Section 14
hereof, at any time after the close of business on the
Distribution Date, and at or prior to the close of
business on the Expiration Date, any Rights Certificate
or Certificates may be transferred, split up, combined or
exchanged for another Rights Certificate or Certificates,
entitling the registered holder to purchase a like number
of one one-thousandths of a share of Preferred Stock (or,
following a Triggering Event, Common Stock, other
securities, cash or other assets, as the case may be) as
the Rights Certificate or Certificates surrendered then
entitled such holder (or former holder in the case of a
transfer) to purchase. Any registered holder desiring to
transfer, split up, combine or exchange any Rights
Certificate or Certificates shall make such request in
writing delivered to the Rights Agent, and shall
surrender the Rights Certificate or Certificates to be
transferred, split up, combined or exchanged 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 Rights Certificate until the registered
holder shall have completed and signed the certificate
contained in the form of assignment on the reverse side
of such Rights Certificate and shall have provided such
additional evidence of the identity of the Beneficial
Owner (or former Beneficial Owner) or Affiliates or
Associates thereof as the Company shall reasonably
request. Thereupon the Rights Agent shall, subject to
Section 4(b), Section 7(e) and Section 14 hereof,
countersign and deliver to the Person entitled thereto a
Rights Certificate or Rights Certificates, as the case
may be, as so requested. The Company may require payment
of a sum sufficient to cover any tax or governmental
charge that may be imposed in connection with any
transfer, split up, combination or exchange of Rights
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 Rights
Certificate, and, in case of loss, theft or destruction,
of indemnity or security reasonably satisfactory to them,
and 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
Rights Certificate if mutilated, the Company will execute
and deliver a new Rights Certificate of like tenor to the
Rights Agent for countersignature and delivery to the
registered owner in lieu of the Rights Certificate so
lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights. (a) Subject to Section 7(e)
hereof, the registered holder of any Rights Certificate
may exercise the Rights evidenced thereby (except as
otherwise provided herein including, without limitation,
the restrictions on exercisability set forth in Section
9(c), Section 11(a)(iii) and Section 23(a) hereof) in
whole or in part at any time after the Distribution Date
upon surrender of the Rights 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 of the
aggregate Purchase Price with respect to the total number
of one one-thousandths of a share (or other securities,
cash or other assets, as the case may be) as to which
such surrendered Rights are then exercisable, at or prior
to the earlier of (i) the close of business on January
31, 2006, (the "Final Expiration Date"), or (ii) the time
at which the Rights are redeemed as provided in Section
23 hereof (the earlier of (i) and (ii) being herein
referred to as the "Expiration Date").
(b) The Purchase Price for each one
one-thousandth of a share of Preferred Stock pursuant to
the exercise of a Right shall initially be $25, and shall
be subject to adjustment from time to time as provided in
Sections 11 and 13(a) hereof and shall be payable in
accordance with paragraph (c) below.
(c) Upon receipt of a Rights Certificate
representing exercisable Rights, with the form of
election to purchase and the certificate duly executed,
accompanied by payment, with respect to each Right so
exercised, of the Purchase Price per one one-thousandth
of a share of Preferred Stock (or other shares,
securities, cash or other assets, as the case may be) to
be purchased as set forth below and an amount equal to
any applicable transfer tax, the Rights Agent shall,
subject to Section 20(k) hereof, thereupon promptly (i)
(A) requisition from any transfer agent of the shares of
Preferred Stock (or make available, if the Rights Agent
is the transfer agent for such shares) certificates for
the total number of one one-thousandths of a share of
Preferred 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 total number of shares of
Preferred Stock issuable upon exercise of the Rights
hereunder with a depositary agent, requisition from the
depositary agent depositary receipts representing such
number of one one-thousandths of a share of Preferred
Stock as are to be purchased (in which case certificates
for the shares of Preferred 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 fractional shares in accordance
with Section 14 hereof, (iii) after receipt of such
certificates or depositary receipts, cause the same to be
delivered to or upon the order of the registered holder
of such Rights Certificate, registered in such name or
names as may be designated by such holder, and (iv) after
receipt thereof, deliver such cash, if any, to or upon
the order of the registered holder of such Rights
Certificate. The payment of the Purchase Price (as such
amount may be reduced pursuant to Section 11(a)(iii)
hereof) shall be made in cash or by certified bank check
or bank draft payable to the order of the Company. In
the event that the Company is obligated to issue other
securities (including Common Stock) of the Company, pay
cash and/or distribute other property pursuant to Section
11(a) hereof, the Company will make all arrangements
necessary so that such other securities, cash and/or
other property are available for distribution by the
Rights Agent, if and when appropriate. The Company
reserves the right to require prior to the occurrence of
a Triggering Event that, upon any exercise of Rights, a
number of Rights be exercised so that only whole shares
of Preferred Stock would be issued.
(d) In case the registered holder of any
Rights Certificate shall exercise less than all the
Rights evidenced thereby, a new Rights Certificate
evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent and
delivered to, or upon the order of, the registered holder
of such Rights Certificate, registered in such name or
names as may be designated by such holder, subject to the
provisions of Section 14 hereof.
(e) Notwithstanding anything in this
Agreement to the contrary, from and after the first
occurrence of a Section 11(a)(ii) Event, any Rights
beneficially owned by (i) an Acquiring Person or an
Associate or Affiliate of an Acquiring Person, (ii) a
transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee after
the Acquiring Person becomes such, or (iii) a transferee
of an Acquiring Person (or of any such Associate or
Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer
(whether or not for consideration) from the Acquiring
Person to holders of equity interests in such Acquiring
Person or to any Person with whom the Acquiring Person
has any continuing agreement, arrangement or
understanding regarding the transferred Rights or (B) a
transfer which the Board of Directors of the Company has
determined is part of a plan, arrangement or
understanding which has as a primary purpose or effect
the avoidance of this Section 7(e), shall become null and
void without any further action and no holder of such
Rights shall have any rights whatsoever with respect to
such Rights, whether under any provision of this
Agreement or otherwise. The Company shall use all
reasonable efforts to insure that the provisions of this
Section 7(e) and Section 4(b) hereof are complied with,
but shall have no liability to any holder of Rights
Certificates or other Person as a result of its failure
to make any determinations with respect to an Acquiring
Person or any of its Affiliates, Associates or
transferees hereunder.
(f) Notwithstanding anything in this
Agreement to the contrary, neither the Rights Agent nor
the Company shall be obligated to undertake any action
with respect to a registered holder upon the occurrence
of any purported exercise as set forth in this Section 7
unless such registered holder shall have (i) completed
and signed the certificate contained in the form of
election to purchase set forth on the reverse side of the
Rights Certificate surrendered for such exercise, and
(ii) provided such additional evidence of the identity of
the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall
reasonably request.
Section 8. Cancellation and Destruction of
Rights Certificates. All Rights Certificates surrendered
for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the
Company or 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 Rights Certificates shall be issued in lieu
thereof except as expressly permitted by any of the
provisions of this Agreement. The Company shall deliver
to the Rights Agent for cancellation and retirement, and
the Rights Agent shall so cancel and retire, any other
Rights Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights
Agent shall deliver all cancelled Rights Certificates to
the Company, or shall, at the written request of the
Company, destroy such cancelled Rights 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 out
of its authorized and unissued shares of Preferred Stock
(and, following the occurrence of a Triggering Event, out
of its authorized and unissued shares of Common Stock
and/or other securities or out of its authorized and
issued shares held in its treasury), the number of shares
of Preferred Stock (and, following the occurrence of a
Triggering Event, Common Stock and/or other securities)
that, as provided in this Agreement including Section
11(a)(iii) hereof, will be sufficient to permit the
exercise in full of all outstanding Rights.
(b) So long as the shares of Preferred
Stock (and, following the occurrence of a Triggering
Event, Common Stock and/or other securities) issuable and
deliverable upon the exercise of the 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 shares reserved for
such issuance to be listed on such exchange upon official
notice of issuance upon such exercise.
(c) The Company shall use its best
efforts to (i) file, as soon as practicable following the
earliest date after the first occurrence of a Section
11(a)(ii) Event on which the consideration to be
delivered by the Company upon exercise of the Rights has
been determined in accordance with Section 11(a)(iii)
hereof, a registration statement under the Securities Act
of 1933 (the "Act"), with respect to the securities
purchasable upon exercise of the Rights on an appropriate
form, (ii) cause such registration statement to become
effective as soon as practicable after such filing, and
(iii) cause such registration statement to remain
effective (with a prospectus at all times meeting the
requirements of the Act) until the earlier of (A) the
date as of which the Rights are no longer exercisable for
such securities, and (B) the date of the expiration of
the Rights. 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 ninety (90) days after the date set forth in
clause (i) of the first sentence of this Section 9(c),
the exercisability of the Rights in order to prepare and
file such registration statement and permit it to become
effective. Upon any such suspension, the Company shall
issue a public announcement stating 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. In addition,
if the Company shall determine that a registration
statement is required following the Distribution Date,
the Company may temporarily suspend the exercisability of
the Rights until such time as a registration statement
has been declared effective. Notwithstanding any
provision of this Agreement to the contrary, the Rights
shall not be exercisable in any jurisdiction if the
requisite qualification in such jurisdiction shall not
have been obtained, the exercise thereof shall not be
permitted under applicable law or a registration
statement shall not have been declared effective.
(d) The Company covenants and agrees that
it will take all such action as may be necessary to
ensure that all one one-thousandths of a share of
Preferred Stock (and, following the occurrence of a
Triggering Event, Common Stock and/or other securities)
delivered upon exercise of Rights shall, at the time of
delivery of the certificates for such shares (subject to
payment of the Purchase Price), be duly and validly
authorized and issued and fully paid and nonassessable.
(e) The Company further covenants and
agrees that it will pay when due and payable any and all
federal and state transfer taxes and charges which may be
payable in respect of the issuance or delivery of the
Rights Certificates and of any certificates for a number
of one one-thousandths of a share of Preferred Stock (or
Common Stock and/or other securities, as the case may be)
upon the exercise of Rights. The Company shall not,
however, be required to pay any transfer tax which may be
payable in respect of any transfer or delivery of Rights
Certificates to a Person other than, or the issuance or
delivery of a number of one one-thousandths of a share of
Preferred Stock (or Common Stock and/or other securities,
as the case may be) in respect of a name other than that
of, the registered holder of the Rights Certificates
evidencing Rights surrendered for exercise or to issue or
deliver any certificates for a number of one
one-thousandths of a share of Preferred Stock (or Common
Stock and/or other securities, as the case may be) in a
name other than that of the registered holder upon the
exercise of any Rights until such tax shall have been
paid (any such tax being payable by the holder of such
Rights Certificate at the time of surrender) or until it
has been established to the Company's satisfaction that
no such tax is due.
Section 10. Preferred Stock Record Date. Each
person in whose name any certificate for a number of one
one-thousandths of a share of Preferred Stock (or Common
Stock and/or other securities, as the case may be) is
issued upon the exercise of Rights shall for all purposes
be deemed to have become the holder of record of such
fractional shares of Preferred Stock (or Common Stock
and/or other securities, as the case may be) represented
thereby on, and such certificate shall be dated, the date
upon which the Rights Certificate evidencing such Rights
was duly surrendered and payment of the Purchase Price
(and all applicable transfer taxes) was made; provided,
however, that if the date of such surrender and payment
is a date upon which the Preferred Stock (or Common Stock
and/or other securities, as the case may be) transfer
books of the Company are closed, such Person shall be
deemed to have become the record holder of such shares
(fractional or otherwise) on, and such certificate shall
be dated, the next succeeding Business Day on which the
Preferred Stock (or Common Stock and/or other securities,
as the case may be) transfer books of the Company are
open. Prior to the exercise of the Rights evidenced
thereby, the holder of a Rights Certificate shall not be
entitled to any rights of a stockholder of the Company
with respect to shares for which the Rights shall be
exercisable, including, without limitation, the right to
vote, to receive dividends or other distributions or to
exercise any preemptive rights, and shall not be entitled
to receive any notice of any proceedings of the Company,
except as provided herein.
Section 11. Adjustment of Purchase Price,
Number and Kind of Shares or Number of Rights. The
Purchase Price, the number and kind of shares covered by
each Right and the number of Rights outstanding are
subject to adjustment from time to time as provided in
this Section 11.
(a)(i) In the event the Company
shall at any time after the date of this
Agreement (A) declare a dividend on the
Preferred Stock payable in shares of Preferred
Stock, (B) subdivide the outstanding Preferred
Stock, (C) combine the outstanding Preferred
Stock into a smaller number of shares, or (D)
issue any shares of its capital stock in a
reclassification of the Preferred Stock
(including any such reclassification in
connection with a consolidation or merger in
which the Company is the continuing or
surviving corporation), except as otherwise
provided in this Section 11(a) and Section 7(e)
hereof, the Purchase Price in effect at the
time of the record date for such dividend or of
the effective date of such subdivision,
combination or reclassification, and the number
and kind of shares of Preferred Stock or
capital stock, as the case may be, issuable on
such date, shall be proportionately adjusted so
that the holder of any Right exercised after
such time shall be entitled to receive, upon
payment of the Purchase Price then in effect,
the aggregate number and kind of shares of
Preferred Stock or 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 Preferred Stock transfer books of the
Company were open, he or she would have owned
upon such exercise and been entitled to receive
by virtue of such dividend, subdivision,
combination or reclassification. If an event
occurs which would require an adjustment under
both this Section 11(a)(i) and Section
11(a)(ii) hereof, the adjustment provided for
in this Section 11(a)(i) shall be in addition
to, and shall be made prior to, any adjustment
required pursuant to Section 11(a)(ii) hereof.
(ii) In the event that any Person
(other than the Company, any Subsidiary of the
Company, any employee benefit plan of the
Company or of any Subsidiary of the Company, or
any Person or entity organized, appointed or
established by the Company for or pursuant to
the terms of any such plan), alone or together
with its Affiliates and Associates, shall, at
any time after the Rights Dividend Declaration
Date, become an Acquiring Person, unless the
event causing the Person to become an Acquiring
Person is a transaction set forth in Section
13(a) hereof, or is an acquisition of shares of
Common Stock pursuant to a tender offer or an
exchange offer for all outstanding shares of
Common Stock at a price and on terms determined
by at least a majority of the members of the
Board of Directors who are not officers of the
Company and who are not representatives,
nominees, Affiliates or Associates of an
Acquiring Person, after receiving advice from
one or more investment banking firms, to be (a)
at a price which is fair to stockholders
(taking into account all factors which such
members of the Board deem relevant including,
without limitation, prices which could
reasonably be achieved if the Company or its
assets were sold on an orderly basis designed
to realize maximum value) and (b) otherwise in
the best interests of the Company and its
stockholders; then, promptly following the
occurrence of any event described in Section
11(a)(ii) hereof, proper provision shall be
made so that each holder of a Right (except as
provided below and in Section 7(e) hereof)
shall thereafter have the right to receive,
upon exercise thereof at the then current
Purchase Price in accordance with the terms of
this Agreement, in lieu of a number of one
one-thousandths of a share of Preferred Stock,
such number of shares of Common Stock of the
Company as shall equal the result obtained by
(x) multiplying the then current Purchase Price
by the then number of one one-thousandths of a
share of Preferred Stock for which a Right was
exercisable immediately prior to the first
occurrence of a Section 11(a)(ii) Event, and
(y) dividing that product (which, following
such first occurrence, shall thereafter be
referred to as the "Purchase Price" for each
Right and for all purposes of this Agreement)
by 50% of the current market price (determined
pursuant to Section 11(d) hereof) per share of
Common Stock on the date of such first
occurrence (such number of shares, the
"Adjustment Shares").
(iii) In the event that the number
of shares of Common Stock which are authorized
by the Company's Amended and Restated
Certificate of Incorporation but not
outstanding or reserved for issuance for
purposes other than upon exercise of the Rights
are not sufficient to permit the exercise in
full of the Rights in accordance with the
foregoing subparagraph (ii) of this Section
11(a), the Company shall (A) determine the
value of the Adjustment Shares issuable upon
the exercise of a Right (the "Current Value"),
and (B) with respect to each Right (subject to
Section 7(e) hereof), make adequate provision
to substitute for the Adjustment Shares, upon
the exercise of a Right and payment of the
applicable Purchase Price, (1) cash, (2) a
reduction in the Purchase Price, (3) Common
Stock or other equity securities of the Company
(including, without limitation, shares, or
units of shares, of preferred stock, such as
the Preferred Stock, which the Board has deemed
to have essentially the same value or economic
rights as shares of Common Stock (such shares
of preferred stock being referred to as "Common
Stock Equivalents")), (4) debt securities of
the Company, (5) other assets, or (6) any
combination of the foregoing, having an
aggregate value equal to the Current Value
(less the amount of any reduction in the
Purchase Price), where such aggregate value has
been determined by the Board based upon the
advice of a nationally recognized investment
banking firm selected by the Board; provided,
however, that if the Company shall not have
made adequate provision to deliver value
pursuant to clause (B) above within thirty (30)
days following the later of (x) the first
occurrence of a Section 11(a)(ii) Event and (y)
the date on which the Company's right of
redemption pursuant to Section 23(a) expires
(the later of (x) and (y) being referred to
herein as the "Section 11(a)(ii) Trigger
Date"), then the Company shall be obligated to
deliver, upon the surrender for exercise of a
Right and without requiring payment of the
Purchase Price, shares of Common Stock (to the
extent available) and then, if necessary, cash,
which shares and/or cash have an aggregate
value equal to the Spread. For purposes of the
preceding sentence, the term "Spread" shall
mean the excess of (i) the Current Value over
(ii) the Purchase Price. If the Board
determines 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 thirty (30) day
period set forth above may be extended to the
extent necessary, but not more than ninety (90)
days after the Section 11(a)(ii) Trigger Date,
in order that the Company may seek shareholder
approval for the authorization of such
additional shares (such thirty (30) day period,
as it may be extended, is herein called the
"Substitution Period"). To the extent that
action is to be taken pursuant to the first
and/or third sentences of this Section
11(a)(iii), the Company (1) shall provide,
subject to Section 7(e) hereof, that such
action shall apply uniformly to all outstanding
Rights, and (2) may suspend the exercisability
of the Rights until the expiration of the
Substitution Period in order to seek such
shareholder approval for such authorization of
additional shares and/or to decide the
appropriate form of distribution to be made
pursuant to such first sentence and to
determine the value thereof. In the event of
any such suspension, the Company shall issue a
public announcement stating that the
exercisability of the Rights has been
temporarily suspended, as well as a public
announcement at such time as the suspension is
no longer in effect. For purposes of this
Section 11(a)(iii), the value of each
Adjustment Share shall be the Current Market
Price per share of the Common Stock on the
Section 11(a)(ii) Trigger Date and the per
share or per unit value of any Common Stock
Equivalent shall be deemed to equal the Current
Market Price per share of the Common Stock on
such date.
(b) In case the Company shall fix a
record date for the issuance of rights (other than the
Rights), options or warrants to all holders of Preferred
Stock entitling them to subscribe for or purchase (for a
period expiring within forty-five (45) calendar days
after such record date) Preferred Stock (or shares having
the same rights, privileges and preferences as the shares
of Preferred Stock ("equivalent preferred stock")) or
securities convertible into Preferred Stock or equivalent
preferred stock at a price per share of Preferred Stock
or per share of equivalent preferred stock (or having a
conversion price per share, if a security convertible
into Preferred Stock or equivalent preferred stock) less
than the current market price (as determined pursuant to
Section 11(d) hereof) per share of Preferred 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
record date by a fraction, the numerator of which shall
be the number of shares of Preferred Stock outstanding on
such record date, plus the number of shares of Preferred
Stock which the aggregate offering price of the total
number of shares of Preferred Stock and/or equivalent
preferred stock so to be offered (and/or the aggregate
initial conversion price of the convertible securities so
to be offered) would purchase at such current market
price, and the denominator of which shall be the number
of shares of Preferred Stock outstanding on such record
date, plus the number of additional shares of Preferred
Stock and/or equivalent preferred stock to be offered for
subscription or purchase (or into which the convertible
securities so to be offered are initially convertible).
In case such subscription price may be paid by delivery
of consideration part or all of which may 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
binding on the Rights Agent and the holders of the
Rights. Shares of Preferred Stock owned by or held for
the account of the Company shall not be deemed
outstanding for the purpose of any such computation.
Such adjustment shall be made successively whenever such
a record date is fixed, and in the event that such rights
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 a distribution to all holders of
Preferred Stock (including any such distribution made in
connection with a consolidation or merger in which the
Company is the continuing corporation) of evidences of
indebtedness, cash (other than a regular quarterly cash
dividend out of the earnings or retained earnings of the
Company), assets (other than a dividend payable in
Preferred Stock, but including any dividend payable in
stock other than Preferred Stock) or subscription rights
or warrants (excluding those referred to in Section 11(b)
hereof), the Purchase Price to be in effect after such
record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such record
date by a fraction, the numerator of which shall be the
current market price (as determined pursuant to Section
11(d) hereof) per share of Preferred Stock on such record
date, less the fair market value (as determined in good
faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed
with the Rights Agent and shall be binding on the Rights
Agent and the holders of the Rights) of the portion of
the cash, assets or evidences of indebtedness so to be
distributed or of such subscription rights or warrants
applicable to a share of Preferred Stock and the
denominator of which shall be such current market price
(as determined pursuant to Section 11(d) hereof) per
share of Preferred Stock. Such adjustments shall be made
successively whenever such a record date is fixed, and in
the event that such distribution is not so made, the
Purchase Price shall be adjusted to be the Purchase Price
which would have been 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) hereof, the Current Market
Price per share of Common Stock on any date shall be
deemed to be the average of the daily closing prices per
share of such Common Stock for the thirty (30)
consecutive Trading Days immediately prior to such date,
and for purposes of computations made pursuant to Section
11(a)(iii) hereof, the Current Market Price per share of
Common Stock on any date shall be deemed to be the
average of the daily closing prices per share of such
Common Stock for the ten (10) consecutive Trading Days
immediately following such date; provided, however, that
in the event that the Current Market Price per share of
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
convertible into shares of such Common Stock (other than
the Rights), or (B) any subdivision, combination or
reclassification of such Common Stock, and the
ex-dividend date for such dividend or distribution, or
the record date for such subdivision, combination or
reclassification shall not have occurred prior to the
commencement of the requisite thirty (30) Trading Day or
ten (10) Trading Day period, as set forth above, 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, as reported in the principal
consolidated transaction reporting system with respect to
securities listed on the principal national securities
exchange on which the shares of 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. 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 shall be used. The term
"Trading Day" shall mean a day on which the principal
national securities exchange on which the shares of
Common Stock are listed or admitted to trading is open
for the transaction of business or, if the shares of
Common Stock are not listed or admitted to trading on any
national securities exchange, a Business Day. If the
Common Stock is not publicly held or not so listed or
traded, Current Market Price per share shall mean the
fair value per share as determined in good faith by the
Board, whose 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 share of
Preferred Stock shall be determined in the same manner as
set forth above for the Common Stock in clause (i) of
this Section 11(d) (other than the last sentence
thereof). If the Current Market Price per share of
Preferred Stock cannot be determined in the manner
provided above or if the Preferred Stock is not publicly
held or listed or traded in a manner described in clause
(i) of this Section 11(d), the Current Market Price per
share of Preferred Stock shall be conclusively deemed to
be an amount equal to 1,000 (as such number may be
appropriately adjusted for such events as stock splits,
stock dividends and recapitalizations with respect to the
Common Stock occurring after the date of this Agreement)
multiplied by the Current Market Price per share of the
Common Stock. If neither the Common Stock nor the
Preferred Stock is publicly held or so listed or traded,
Current Market Price per share of the Preferred Stock
shall mean the fair value per share as determined in good
faith by the Board, whose determination shall be
described in a statement filed with the Rights Agent and
shall be conclusive for all purposes. For all purposes
of this Agreement, the Current Market Price of a Unit
shall be equal to the Current Market Price of one share
of Preferred Stock divided by 1,000.
(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 one percent (1%) in the
Purchase Price; provided, however, that any adjustments
which by reason of this Section 11(e) are not required to
be made shall be carried forward and taken into account
in any subsequent adjustment. All calculations under
this Section 11 shall be made to the nearest cent or to
the nearest ten-thousandth of a share of Common Stock or
other share or one-ten millionth of a share of Preferred
Stock, as the case may be. Notwithstanding the first
sentence of this Section 11(e), any adjustment required
by this Section 11 shall be made no later than the
earlier of (i) three (3) years from the date of the
transaction which mandates such adjustment, or (ii) the
Expiration Date.
(f) If as a result of an adjustment made
pursuant to Section 11(a)(ii) or Section 13(a) hereof,
the holder of any Right thereafter exercised shall become
entitled to receive any shares of capital stock other
than Preferred 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 Preferred Stock contained in Sections 11(a), (b),
(c), (e), (g), (h), (i), (j), (k) and (m), and the
provisions of Sections 7, 9, 10, 13 and 14 hereof with
respect to the Preferred Stock shall apply on like terms
to any such other shares.
(g) All Rights originally issued by the
Company subsequent to any adjustment made to the Purchase
Price hereunder shall evidence the right to purchase, at
the adjusted Purchase Price, the number of one
one-thousandths of a share of Preferred Stock purchasable
from time to time hereunder upon exercise of the Rights,
all subject to further adjustment as provided herein.
(h) Unless the Company shall have
exercised its election as provided in Section 11(i), upon
each adjustment of the Purchase Price as a result of the
calculations made in Sections 11(b) and (c), each Right
outstanding immediately prior to the making of such
adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of
one one-thousandths of a share of Preferred Stock
(calculated to the nearest one-ten millionth) obtained by
(i) multiplying (x) the number of one one-thousandths of
a share covered by a Right immediately prior to this
adjustment, by (y) the Purchase Price in effect
immediately prior to such adjustment of the 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 one one-thousandths of a share of Preferred
Stock purchasable upon the exercise of a Right. Each of
the Rights outstanding after the adjustment in the number
of Rights shall be exercisable for the number of one
one-thousandths of a share of Preferred Stock for which a
Right was exercisable immediately prior to such
adjustment. Each Right held of record prior to such
adjustment of the number of Rights shall become that
number of Rights (calculated to the nearest
one-ten-thousandth) obtained by dividing the Purchase
Price in effect immediately prior to adjustment of the
Purchase Price by the Purchase Price in effect
immediately after adjustment of the Purchase Price. The
Company shall make a public announcement of its election
to adjust the number of Rights, indicating the record
date for the adjustment, and, if known at the time, the
amount of the adjustment to be made. This record date
may be the date on which the Purchase Price is adjusted
or any day thereafter, but, if the Rights Certificates
have been issued, shall be at least ten (10) days later
than the date of the public announcement. If Rights
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 Rights Certificates
on such record date Rights Certificates evidencing,
subject to Section 14 hereof, the additional Rights to
which such holders shall be entitled as a result of such
adjustment, or, at the option of the Company, shall cause
to be distributed to such holders of record in
substitution and replacement for the Rights Certificates
held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new
Rights Certificates evidencing all the Rights to which
such holders shall be entitled after such adjustment.
Rights 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 Rights Certificates on
the record date specified in the public announcement.
(j) Irrespective of any adjustment or
change in the Purchase Price or the number of one one-
thousandth of a share of Preferred Stock issuable upon
the exercise of the Rights, the Rights Certificates
theretofore and thereafter issued may continue to express
the Purchase Price per one one-thousandth of a share and
the number of one one-thousandth of a share which were
expressed in the initial Rights Certificates issued
hereunder.
(k) Before taking any action that would
cause an adjustment reducing the Purchase Price below the
then stated value, if any, of the number of one
one-thousandths of a share of Preferred 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 one one-thousandth of a share of Preferred
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 one
one-thousandths of a share of Preferred Stock and other
capital stock or securities of the Company, if any,
issuable upon such exercise over and above the number of
one one-thousandths of a share of Preferred Stock and
other capital stock or securities of the Company, if any,
issuable upon such exercise on the basis of the Purchase
Price in effect prior to such adjustment; provided,
however, that the Company shall deliver to such holder a
due bill or other appropriate instrument evidencing such
holder's right to receive such additional shares
(fractional or otherwise) or securities 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 in their good faith
judgment the Board of Directors of the Company shall
determine to be advisable in order that any (i)
consolidation or subdivision of the Preferred Stock, (ii)
issuance wholly for cash of any shares of Preferred Stock
at less than the current market price, (iii) issuance
wholly for cash of shares of Preferred Stock or
securities which by their terms are convertible into or
exchangeable for shares of Preferred Stock, (iv) stock
dividends or (v) issuance of rights, options or warrants
referred to in this Section 11, hereafter made by the
Company to holders of its Preferred Stock shall not be
taxable to such stockholders.
(n) The Company covenants and agrees that
it shall not, at any time after the Distribution Date,
(i) consolidate with any other Person (other than a
Subsidiary of the Company in a transaction which complies
with Section 11(o) hereof), (ii) merge with or into any
other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) hereof), or
(iii) sell or transfer (or permit any Subsidiary to sell
or 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 (other than the Company and/or any of
its Subsidiaries in one or more transactions each of
which complies with Section 11(o) hereof), if (x) at the
time of or immediately after such consolidation, merger
or sale there are any rights, warrants or other
instruments or securities outstanding or agreements in
effect which would substantially diminish or otherwise
eliminate the benefits intended to be afforded by the
Rights or (y) prior to, simultaneously with or
immediately after such consolidation, merger or sale, the
shareholders of the Person who constitutes, or would
constitute, the "Principal Party" for purposes of Section
13(a) hereof shall have received a distribution of Rights
previously owned by such Person or any of its Affiliates
and Associates.
(o) The Company covenants and agrees
that, after the Distribution Date, it will not, except as
permitted by Section 23 or Section 26 hereof, 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 diminish substantially or otherwise
eliminate the benefits intended to be afforded by the
Rights.
(p) Anything in this Agreement to the
contrary notwithstanding, in the event that the Company
shall at any time after the Rights Dividend Declaration
Date and prior to the Distribution Date (i) declare a
dividend on the outstanding shares of Common Stock
payable in shares of Common Stock, (ii) subdivide the
outstanding shares of Common Stock, or (iii) combine the
outstanding shares of 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 but prior to the Distribution Date,
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 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 Section 11 and Section 13 hereof, 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
Preferred Stock and the Common Stock, a copy of such
certificate, and (c) mail a brief summary thereof to each
holder of a Rights Certificate (or, if prior to the
Distribution Date, to each holder of a certificate
representing shares of Common Stock) in accordance with
Section 25 hereof. The Rights Agent shall be fully
protected in relying on any such certificate and on any
adjustment therein contained.
Section 13. Consolidation, Merger or Sale or
Transfer of Assets or Earning Power.
(a) In the event that, following the
Stock Acquisition Date, directly or indirectly, (x) the
Company shall consolidate with, or merge with and into,
any other Person (other than a Subsidiary of the Company
in a transaction which complies with Section 11(o)
hereof), and the Company shall not be the continuing or
surviving corporation of such consolidation or merger,
(y) any Person (other than a Subsidiary of the Company in
a transaction which complies with Section 11(o) hereof)
shall consolidate with, or merge with or into, the
Company, and the Company shall be the continuing or
surviving corporation of such consolidation or merger
and, in connection with such consolidation or merger, all
or part of the outstanding shares of Common Stock shall
be changed into or exchanged for stock or other
securities of any other Person or cash or any other
property, or (z) the Company shall sell or otherwise
transfer (or one or more of its Subsidiaries shall sell
or otherwise transfer), in one 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
Person or Persons (other than the Company or any
Subsidiary of the Company in one or more transactions
each of which complies with Section 11(o) hereof), then,
and in each such case (except as may be contemplated by
Section 13(d) hereof), proper provision shall be made so
that: (i) each holder of a Right, except as provided in
Section 7(e) hereof, shall thereafter have the right to
receive, upon the exercise thereof at the then current
Purchase Price in accordance with the terms of this
Agreement, such number of validly authorized and issued,
fully paid, non-assessable and freely tradeable shares of
Common Stock of the Principal Party (as such term is
hereinafter defined), not subject to any liens,
encumbrances, rights of first refusal or other adverse
claims, as shall be equal to the result obtained by (1)
multiplying the then current Purchase Price by the number
of one one-thousandths of a share of Preferred Stock for
which a Right is exercisable immediately prior to the
first occurrence of a Section 13 Event (or, if a Section
11(a)(ii) Event has occurred prior to the first
occurrence of a Section 13 Event, multiplying the number
of such one one-thousandths of a share for which a Right
was exercisable immediately prior to the first occurrence
of a Section 11(a)(ii) Event by the Purchase Price in
effect immediately prior to such first occurrence), and
dividing that product (which, following the first
occurrence of a Section 13 Event, shall be referred to as
the "Purchase Price" for each Right and for all purposes
of this Agreement) by (2) 50% of the current market price
(determined pursuant to Section 11(d)(i) hereof) per
share of the Common Stock of such Principal Party on the
date of consummation of such Section 13 Event; (ii) such
Principal Party shall thereafter be liable for, and shall
assume, by virtue of such Section 13 Event, all the
obligations and duties of the Company pursuant to this
Agreement; (iii) the term "Company" shall thereafter be
deemed to refer to such Principal Party, it being
specifically intended that the provisions of Section 11
hereof shall apply only to such Principal Party following
the first occurrence of a Section 13 Event; (iv) such
Principal Party shall take such steps (including, but not
limited to, the reservation of a sufficient number of
shares of its Common Stock) in 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 its shares of Common Stock thereafter deliverable upon
the exercise of the Rights; and (v) the provisions of
Section 11(a)(ii) hereof shall be of no effect following
the first occurrence of any Section 13 Event.
(b) "Principal Party" shall mean
(i) in the case of any
transaction described in clause (x) or (y) of
the first sentence of Section 13(a), the Person
that is the issuer of any securities into which
shares of Common Stock of the Company are
converted in such merger or consolidation, and
if no securities are so issued, the Person that
is the other party to such merger or
consolidation; and
(ii) in the case of any
transaction described in clause (z) of the
first sentence of Section 13(a), the Person
that is the party receiving the greatest
portion of the assets or earning power
transferred pursuant to such transaction or
transactions;
provided, however, that in any such case, (1) if the
Common Stock of such Person is not at such time and has
not been continuously over the preceding twelve (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 (2) 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, sale or transfer unless the
Principal Party shall have a sufficient number of
authorized shares of its Common Stock which have not been
issued or reserved for issuance to permit the exercise in
full of the Rights in accordance with this Section 13 and
unless prior thereto the Company and such Principal Party
shall have executed and delivered to the Rights Agent a
supplemental agreement providing for the terms set forth
in paragraphs (a) and (b) of this Section 13 and further
providing that, as soon as practicable after the date of
any consolidation, merger or sale of assets mentioned in
paragraph (a) of this Section 13, the Principal Party
will
(i) prepare and file a
registration statement under the Act, with
respect to the Rights and the securities
purchasable upon exercise of the Rights on an
appropriate form, and will use its best efforts
to cause such registration statement to (A)
become effective as soon as practicable after
such filing and (B) remain effective (with a
prospectus at all times meeting the
requirements of the Act) until the Expiration
Date; and
(ii) will deliver to holders of
the Rights historical financial statements for
the Principal Party and each of its Affiliates
which comply in all respects with the
requirements for registration on Form 10 under
the Exchange Act.
The provisions of this Section 13 shall similarly apply
to successive mergers or consolidations or sales or other
transfers. In the event that a Section 13 Event shall
occur at any time after the occurrence of a Section
11(a)(ii) Event, the Rights which have not theretofore
been exercised shall thereafter become exercisable in the
manner described in Section 13(a).
(d) Notwithstanding anything in this
Agreement to the contrary, Section 13 shall not be
applicable to a transaction described in subparagraphs
(x) and (y) of Section 13(a) if (i) such transaction is
consummated with a Person or Persons who acquired shares
of Common Stock pursuant to a tender offer or exchange
offer for all outstanding shares of Common Stock which
complies with the provisions of Section 11(a)(ii)(B)
hereof (or a wholly owned subsidiary of any such Person
or Persons), (ii) the price per share of Common Stock
offered in such transaction is not less than the price
per share of Common Stock paid to all holders of shares
of Common Stock whose shares were purchased pursuant to
such tender offer or exchange offer and (iii) the form of
consideration being offered to the remaining holders of
shares of Common Stock pursuant to such transaction is
the same as the form of consideration paid pursuant to
such tender offer or exchange offer. Upon consummation
of any such transaction contemplated by this Section
13(d), all Rights hereunder shall expire.
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) hereof, or
to distribute Rights Certificates which evidence
fractional Rights. In lieu of such fractional Rights,
there shall be paid to the registered holders of the
Rights Certificates with regard to which such fractional
Rights would otherwise be issuable, an amount in cash
equal to the same fraction of the current market value of
a whole Right. For purposes of this Section 14(a), the
current market value of a whole Right shall be the
closing price of the Rights for the Trading Day
immediately prior to the date on which such fractional
Rights would have been otherwise issuable. The closing
price of the Rights for any day shall be the last sale
price, regular way, or, in case no such sale takes place
on such day, the average of the closing bid and asked
prices, regular way, in either case as reported in the
principal consolidated transaction reporting system with
respect to securities listed or admitted to trading on
the New York Stock Exchange or, if the Rights are not
listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities
listed on the principal national securities exchange on
which the Rights are listed or admitted to trading, or if
the Rights are not listed or admitted to trading on any
national securities exchange, the last quoted price or,
if not so quoted, the average of the high bid and low
asked prices in the over-the-counter market, as reported
by NASDAQ or such other system then in use or, if on any
such date the Rights are not quoted by any such
organization, the average of the closing bid and asked
prices as furnished by a professional market maker making
a market in the Rights selected by the Board of Directors
of the Company. If on any such date no such market maker
is making a market in the Rights the fair value of the
Rights on such date as determined in good faith by the
Board of Directors of the Company shall be used.
(b) The Company shall not be required to
issue fractions of shares of Preferred Stock (other than
fractions which are integral multiples of one
one-thousandth of a share of Preferred Stock) upon
exercise of the Rights or to distribute certificates
which evidence fractional shares of Preferred Stock
(other than fractions which are integral multiples of one
one-thousandth of a share of Preferred Stock). In lieu
of fractional shares of Preferred Stock that are not
integral multiples of one one-thousandth of a share of
Preferred Stock, the Company may pay to the registered
holders of Rights Certificates at the time such Rights
are exercised as herein provided an amount in cash equal
to the same fraction of the current market value of one
one-thousandth of a share of Preferred Stock. For
purposes of this Section 14(b), the current market value
of one one-thousandth of a share of Preferred Stock shall
be one one-thousandth of the closing price of a share of
Preferred Stock (as determined pursuant to Section
11(d)(ii) hereof) for the Trading Day immediately prior
to the date of such exercise.
(c) Following the occurrence of a
Triggering Event, 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 may pay to
the registered holders of Rights Certificates at the time
such Rights are exercised as herein provided an amount in
cash equal to the same fraction of the current market
value of one (1) share of Common Stock. For purposes of
this Section 14(c), the current market value of one share
of Common Stock shall be the closing price of one share
of Common Stock (as determined pursuant to Section
11(d)(i) hereof) for the Trading Day immediately prior to
the date of such exercise.
(d) The holder of a Right by the
acceptance of the Rights expressly waives his or her
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 Rights Certificates
(and, prior to the Distribution Date, the registered
holders of the Common Stock); and any registered holder
of any Rights Certificate (or, prior to the Distribution
Date, of the Common Stock), without the consent of the
Rights Agent or of the holder of any other Rights
Certificate (or, prior to the Distribution Date, of the
Common Stock), may, in his or her own behalf and for his
or her 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
or her right to exercise the Rights evidenced by such
Rights Certificate in the manner provided in such Rights
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 shall be entitled to
specific performance of the obligations hereunder and
injunctive relief against actual or threatened violations
of the obligations hereunder of any Person subject to
this Agreement.
Section 16. Agreement of Rights 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
Rights 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 Section 6(a) and Section
7(f) hereof, the Company and the Rights Agent may deem
and treat the person in whose name a Rights Certificate
(or, prior to the Distribution Date, the associated
Common Stock certificate) is registered as the absolute
owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on
the Rights Certificates or the associated Common Stock
certificate made by anyone other than the Company or the
Rights Agent) for all purposes whatsoever, and neither
the Company nor the Rights Agent, subject to the last
sentence of Section 7(e) hereof, shall be required to 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, however, the Company must use its best efforts
to have any such order, decree or ruling lifted or
otherwise overturned as soon as possible.
Section 17. Rights Certificate Holder Not
Deemed a Stockholder. No holder, as such, of any Rights
Certificate shall be entitled to vote, receive dividends
or be deemed for any purpose the holder of the number of
one one-thousandths of a share of Preferred Stock or any
other securities of the Company which may at any time be
issuable on the exercise of the Rights represented
thereby, nor shall anything contained herein or in any
Rights Certificate be construed to confer upon the holder
of any Rights 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 24 hereof),
or to receive dividends or subscription rights, or
otherwise, until the Right or Rights evidenced by such
Rights 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 administration and execution of this
Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the
Rights Agent for, and to hold it harmless against, any
loss, liability, or expense, incurred without negligence,
bad faith or willful misconduct on the part of the Rights
Agent, for anything done or omitted by the Rights Agent
in connection with the acceptance and administration of
this Agreement, including the costs and expenses of
defending against any claim of liability in the premises.
(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 its administration of this Agreement in reliance
upon any Rights 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, 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 shareholder services 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, however, that such corporation would be
eligible for appointment as a successor Rights Agent
under the provisions of Section 21 hereof. In case at
the time such successor Rights Agent shall succeed to the
agency created by this Agreement, any of the Rights
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 Rights Certificates so countersigned; and in
case at that time any of the Rights Certificates shall
not have been countersigned, any successor Rights Agent
may countersign such Rights Certificates either in the
name of the predecessor or in the name of the successor
Rights Agent; and in all such cases such Rights
Certificates shall have the full force provided in the
Rights 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
Rights Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Rights
Certificates so countersigned; and in case at that time
any of the Rights Certificates shall not have been
countersigned, the Rights Agent may countersign such
Rights Certificates either in its prior name or in its
changed name; and in all such cases such Rights
Certificates shall have the full force provided in the
Rights 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 Rights 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 or suffering any action hereunder, such fact or
matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be
conclusively proved and established by a certificate
signed by the Chairman of the Board, the President, any
Vice President, the Treasurer, any Assistant Treasurer,
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 or suffered in good faith by it under the
provisions of this Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable
hereunder only for its own negligence, bad faith or
willful misconduct.
(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 Rights
Certificates or be required to verify the same (except as
to its countersignature on such Rights Certificates), 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 Rights
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 Rights Certificate; nor shall it be responsible
for any adjustment required under the provisions of
Section 11 or Section 13 hereof or responsible for the
manner, method or amount of any such adjustment or the
ascertaining of the existence of facts that would require
any such adjustment (except with respect to the exercise
of Rights evidenced by Rights 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 or Preferred Stock to be issued
pursuant to this Agreement or any Rights Certificate or
as to whether any shares of Common Stock or Preferred
Stock will, when so issued, be validly authorized and
issued, fully paid and nonassessable.
(f) The Company agrees that it will
perform, execute, acknowledge and deliver or cause to be
performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the
carrying out or performing by the Rights Agent of the
provisions of this 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, any Vice President, the
Secretary, any Assistant Secretary, 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 or suffered 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 Rights Agent under this Agreement. Nothing herein
shall preclude the Rights Agent from acting in any other
capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and
exercise any of the rights or powers hereby vested in it
or perform any duty hereunder either itself or by or
through its attorneys or agents, and the Rights Agent
shall not be answerable or accountable for any act,
default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any
such act, default, neglect or misconduct; provided,
however, reasonable care was exercised in the selection
and continued employment thereof.
(j) The Rights Agent shall not be under
any duty or responsibility to institute any action, suit
or legal proceeding or to take any other action likely to
involve expense unless the Company or one or more holders
of Rights Certificates shall furnish the Rights Agent
with security and indemnity to its reasonable
satisfaction for any costs and expenses which may be
incurred.
(k) If, with respect to any Right
Certificate surrendered to the Rights Agent for exercise
or transfer, the certificate attached to the form of
assignment or form of election to purchase, as the case
may be, has either not been completed or indicates an
affirmative response to clause 1 and/or 2 thereof, the
Rights Agent shall not take any further action with
respect to such requested exercise of transfer without
first consulting with the Company.
(l) The Rights Agent shall not be liable
for failure to perform any duties except as specifically
set forth herein and no implied covenants or obligations
shall be read into this Agreement against the Rights
Agent whose duties and obligations are ministerial and
shall be determined solely by the express provisions
hereof.
Section 21. Change of Rights Agent. The
Rights Agent or any successor Rights Agent may resign and
be discharged from its duties under this Agreement upon
thirty (30) days' notice in writing mailed to the
Company, and to each transfer agent of the Common Stock
and Preferred Stock, by registered or certified mail, and
to the holders of the Rights Certificates by first-class
mail. The Company may remove the Rights Agent or any
successor Rights Agent upon thirty (30) days' notice in
writing, mailed to the Rights Agent or successor Rights
Agent, as the case may be, and to each transfer agent of
the Common Stock and Preferred Stock, by registered or
certified mail, and to the holders of the Rights
Certificates by first-class mail. If the Rights Agent
shall resign or be removed or shall otherwise become
incapable of acting, the Company shall appoint a
successor to the Rights Agent. If the Company shall fail
to make such appointment within a period of thirty (30)
days after giving notice of such removal or after it has
been notified in writing of such resignation or
incapacity by the resigning or incapacitated Rights Agent
or by the holder of a Rights Certificate (who shall, with
such notice, submit his Rights Certificate for inspection
by the Company), then any registered holder of any Rights
Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent.
Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be a corporation
organized and doing business under the laws of the United
States or of the State of New York (or of any other state
of the United States so long as such corporation is
authorized to do business as a banking institution in the
State of New York), in good standing, which is authorized
under such laws to exercise 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
$100,000,000. 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 Preferred
Stock, and mail a notice thereof in writing to the
registered holders of the Rights Certificates. Failure
to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the
legality or validity of the resignation or removal of the
Rights Agent or the appointment of the successor Rights
Agent, as the case may be.
Section 22. Issuance of New Rights
Certificates. Notwithstanding any of the provisions of
this Agreement or of the Rights to the contrary, the
Company may, at its option, issue new Rights Certificates
evidencing Rights in such form as may be approved by its
Board of Directors to reflect any adjustment or change in
the Purchase Price and the number or kind or class of
shares or other securities or property purchasable under
the Rights Certificates made in accordance with the
provisions of this Agreement. In addition, in connection
with the issuance or sale of shares of Common Stock
following the Distribution Date and prior to the
redemption or expiration of the Rights, the Company (a)
shall, with respect to shares of Common Stock so issued
or sold pursuant to the exercise of stock options or
under any employee plan or arrangement, granted or
awarded as of the Distribution Date, or upon the
exercise, conversion or exchange of securities
hereinafter issued by the Company, and (b) may, in any
other case, if deemed necessary or appropriate by the
Board of Directors of the Company, issue Rights
Certificates representing the appropriate number of
Rights in connection with such issuance or sale;
provided, however, that (i) no such Rights Certificate
shall be issued if, and to the extent that, the Company
shall be advised by counsel that such issuance would
create a significant risk of material adverse tax
consequences to the Company or the Person to whom such
Rights Certificate would be issued, and (ii) no such
Rights Certificate shall be issued if, and to the extent
that, appropriate adjustment shall otherwise have been
made in lieu of the issuance thereof.
Section 23. Redemption and Termination.
(a) The Board of Directors of the Company
may, at its option, at any time prior to the earlier of
(i) the close of business on the tenth day following the
Stock Acquisition Date (or, if the Stock Acquisition Date
shall have occurred prior to the Record Date, the close
of business on the tenth day following the Record Date),
or (ii) the Final Expiration Date, redeem all but not
less than all the then outstanding Rights at a redemption
price of $0.01 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, however, if the
Board of Directors of the Company authorizes redemption
of the Rights in either of the circumstances set forth in
clauses (i) and (ii) below, then there must be Continuing
Directors then in office and such authorization shall
require the concurrence of a majority of such Continuing
Directors: (i) such authorization occurs on or after the
time a Person becomes an Acquiring Person, or (ii) such
authorization occurs on or after the date of a change
(resulting from a proxy or consent solicitation) in a
majority of the directors in office at the commencement
of such solicitation if any Person who is a participant
in such solicitation has stated (or, if upon the
commencement of such solicitation, a majority of the
Board of Directors of the Company has determined in good
faith) that such Person (or any of its Affiliates or
Associates) intends to take, or may consider taking, any
action which would result in such Person becoming an
Acquiring Person or which would cause the occurrence of a
Triggering Event unless, concurrent with such
solicitation, such Person (or one or more of its
Affiliates or Associates) is making a cash tender offer
pursuant to a Schedule 14D-1 (or any successor form)
filed with the Securities and Exchange Commission for all
outstanding shares of Common Stock not beneficially owned
by such Person (or by its Affiliates or Associates).
Notwithstanding anything contained in this Agreement to
the contrary, the Rights shall not be exercisable after
the first occurrence of a Section 11(a)(ii) Event until
such time as the Company's right of redemption hereunder
has expired. The Company may, at its option, pay the
Redemption Price in cash, shares of Common Stock (based
on the "current market price", as defined in Section
11(d)(i) hereof, of the Common Stock at the time of
redemption) or any other form of consideration deemed
appropriate by the Board of Directors.
(b) Immediately upon the action of the
Board of Directors of the Company ordering the redemption
of the Rights, evidence of which shall have been filed
with the Rights Agent and without any further action and
without any notice, the right to exercise the Rights will
terminate and the only right thereafter of the holders of
Rights shall be to receive the Redemption Price for each
Right so held. Promptly after the action of the Board of
Directors ordering the redemption of the Rights, the
Company shall give notice of such redemption to the
Rights Agent and the holders of the then outstanding
Rights by mailing such notice to all such holders at each
holder's last address as it appears upon the registry
books of the Rights Agent or, prior to the Distribution
Date, on the registry books of the transfer agent for the
Common Stock. Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the
holder receives the notice. Each such notice of
redemption will state the method by which the payment of
the Redemption Price will be made.
Section 24. Notice of Certain Events.
(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
Preferred Stock or to make any other distribution to the
holders of Preferred 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 Preferred Stock rights or warrants to subscribe for or
to purchase any additional shares of Preferred Stock or
shares of stock of any class or any other securities,
rights or options, or (iii) to effect any
reclassification of its Preferred Stock (other than a
reclassification involving only the subdivision of
outstanding shares of Preferred Stock), or (iv) to effect
any consolidation or merger into or with any other Person
(other than a Subsidiary of the Company in a transaction
which complies with Section 11(o) hereof), or to effect
any sale or other transfer (or to permit one or more of
its Subsidiaries to effect any sale or other transfer),
in one transaction or a series of related transactions,
of more than 50% of the assets or earning power of the
Company and its Subsidiaries (taken as a whole) to any
other Person or Persons (other than the Company and/or
any of its Subsidiaries in one or more transactions each
of which complies with Section 11(o) hereof), 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 Rights Certificate, to the extent
feasible and in accordance with Section 25 hereof, a
notice of such proposed action, which shall specify the
record date for the purposes of such stock dividend,
distribution of rights or warrants, or the date on which
such reclassification, consolidation, merger, sale,
transfer, liquidation, dissolution, or winding up is to
take place and the date of participation therein by the
holders of the shares of Preferred Stock, if any such
date is to be fixed, and such notice shall be so given in
the case of any action covered by clause (i) or (ii)
above at least twenty (20) days prior to the record date
for determining holders of the shares of Preferred Stock
for purposes of such action, and in the case of any such
other action, at least twenty (20) days prior to the date
of the taking of such proposed action or the date of
participation therein by the holders of the shares of
Preferred Stock whichever shall be the earlier.
(b) In case any of the events set forth
in Section 11(a)(ii) hereof shall occur, then, in any
such case, (i) the Company shall as soon as practicable
thereafter give to each holder of a Rights Certificate,
to the extent feasible and in accordance with Section 25
hereof, 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) hereof, and
(ii) all references in the preceding paragraph to
Preferred Stock shall be deemed thereafter to refer to
Common Stock and/or, if appropriate, other securities.
Section 25. Notices. Notices or demands
authorized by this Agreement to be given or made by the
Rights Agent or by the holder of any Rights Certificate
to or on the Company shall be sufficiently given or made
if sent by first-class mail, postage prepaid, addressed
(until another address is filed in writing with the
Rights Agent) as follows:
Hartmarx Corporation
101 North Wacker Drive
Chicago, Illinois 60606
Attention: General Counsel
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 Rights Certificate
to or on the Rights Agent shall be sufficiently given or
made if sent by first-class mail, postage prepaid,
addressed (until another address is filed in writing with
the Company) as follows:
First Chicago Trust Company
of New York
525 Washington Boulevard
Mail Suite 4660
Jersey City, New Jersey 07310
Attention: Tenders and Exchanges
Administration
Notices or demands authorized by this Agreement to be
given or made by the Company or the Rights Agent to the
holder of any Rights Certificate (or, if prior to the
Distribution Date, to the holder of certificates
representing shares of Common Stock) shall be
sufficiently given or made if sent by first-class mail,
postage prepaid, addressed to such holder at the address
of such holder as shown on the registry books of the
Company.
Section 26. Supplements and Amendments. Prior
to the Distribution Date and subject to the penultimate
sentence of this Section 26, 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 and subject to the penultimate sentence of this
Section 26, the Company and the Rights Agent shall, if
the Company so directs, supplement or amend this
Agreement without the approval of any holders of Rights
Certificates in order (i) to cure any ambiguity, (ii) to
correct or supplement any provision contained herein
which may be defective or inconsistent with any other
provisions herein, (iii) to shorten or lengthen any time
period hereunder (which lengthening or shortening,
following the first occurrence of an event set forth in
clauses (i) and (ii) of the first proviso to Section
23(a) hereof, shall be effective only if there are
Continuing Directors and shall require the concurrence of
a majority of such Continuing Directors), or (iv) to
change or supplement the provisions hereunder in any
manner which the Company may deem necessary or desirable
and which shall not adversely affect the interests of the
holders of Rights Certificates (other than an Acquiring
Person or an Affiliate or Associate of an Acquiring
Person); provided, this Agreement may not be supplemented
or amended to lengthen, pursuant to clause (iii) of this
sentence, (A) a time period relating to when the Rights
may be redeemed at such time as the Rights are not then
redeemable, or (B) any other time period unless such
lengthening is for the purpose of protecting, enhancing
or clarifying the rights of, and/or the benefits to, the
holders of Rights (other than an Acquiring Person and its
Affiliates and Associates). Upon the delivery of a
certificate from an appropriate officer of the Company
which states that the proposed supplement or amendment is
in compliance with the terms of this Section 26, the
Rights Agent shall execute such supplement or amendment.
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 27. 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 28. 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) of the General Rules and Regulations under
the Exchange Act. The Board of Directors of the Company
(with, where specifically provided for herein, the
concurrence 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 (with, where
specifically provided for herein, the concurrence of the
Continuing Directors) or to the Company, or as may be
necessary or advisable in the administration of this
Agreement, including, without limitation, the right and
power to (i) interpret the provisions of this Agreement,
and (ii) make all determinations deemed necessary or
advisable for the administration of this Agreement
(including a determination to redeem or not redeem the
Rights or to amend the Agreement). All such actions,
calculations, interpretations and determinations
(including, for purposes of clause (y) below, all
omissions with respect to the foregoing) which are done
or made by the Board (with, where specifically provided
for herein, the concurrence of 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 or the Continuing Directors to any liability to the
holders of the Rights.
Section 29. 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 Rights Certificates (and,
prior to the Distribution Date, registered holders of the
Common Stock) any legal or equitable right, remedy or
claim under this Agreement; but this Agreement shall be
for the sole and exclusive benefit of the Company, the
Rights Agent and the registered holders of the Rights
Certificates (and, prior to the Distribution Date,
registered holders of the Common Stock).
Section 30. Severability. If any term,
provision, covenant or restriction of this Agreement is
held by a court of competent jurisdiction or other
authority to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force
and effect and shall in no way be affected, impaired or
invalidated; provided, however, that notwithstanding
anything in this Agreement to the contrary, if any such
term, provision, covenant or restriction is held by such
court or authority to be invalid, void or unenforceable
and the Board of Directors of the Company determines in
its good faith judgment that severing the invalid
language from this Agreement would adversely affect the
purpose or effect of this Agreement, the right of
redemption set forth in Section 23 hereof 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. Without
limiting the foregoing, if any provision requiring a
majority of the Board of Directors of the Company to be
Continuing Directors to act is held by any court of
competent jurisdiction or other authority to be invalid,
void or unenforceable, such determination shall then be
made by the Board of Directors of the Company in
accordance with applicable law and the Company's Amended
and Restated Certificate of Incorporation and By-Laws.
Section 31. Governing Law. This Agreement,
each Right and each Rights 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 made and to be
performed entirely within such State.
Section 32. Counterparts. This Agreement may
be executed in any number of counterparts and each of
such counterparts shall for all purposes be deemed to be
an original, and all such counterparts shall together
constitute but one and the same instrument.
Section 33. Descriptive Headings. Descriptive
headings of the several Sections of this Agreement are
inserted for convenience only and shall not control or
affect the meaning or construction of any of the
provisions hereof.
IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be duly executed and their
respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Attest: HARTMARX CORPORATION
By /S/ MARY D. ALLEN By /S/ GLENN R. MORGAN
Name: Mary D. Allen Name: Glenn R. Morgan
Title: Secretary Title: Executive Vice
President and Chief
Financial Officer
Attest: FIRST CHICAGO TRUST COMPANY
OF NEW YORK
By /S/ RALPH PERSICO By /S/ JOANNE GOROSTIOLA
Name: Ralph Persico Name: Joanne Gorostiola
Title: Customer Service Title: Assistant Vice
Representative President
Exhibit A
FORM OF
CERTIFICATE OF DESIGNATION, PREFERENCES
AND RIGHTS OF SERIES A JUNIOR
PARTICIPATING PREFERRED STOCK
of
HARTMARX CORPORATION
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
The undersigned officers of Hartmarx
Corporation, a corporation organized and existing under
the General Corporation Law of the State of Delaware, in
accordance with the provisions of Section 103 thereof, DO
HEREBY CERTIFY:
That pursuant to the authority conferred upon
the Board of Directors by the Restated Certificate of
Incorporation, as amended, of the said Corporation, the
said Board of Directors on December 6, 1995 adopted the
following resolution creating a series of 165,000 shares
of Preferred Stock designated as Series A Junior
Participating Preferred Stock:
BE IT FURTHER RESOLVED, that pursuant to the
authority vested in the Board of Directors of this
Corporation in accordance with the provisions of its
Restated Certificate of Incorporation, as amended, a
series of Preferred Stock of the Corporation be and it is
hereby created, and that the designation and amount
thereof and the voting powers, preferences and relative,
participating, optional and other special rights of the
shares of such series, and the qualifications,
limitations or restrictions thereof are as follows:
Section 1. Designation and Amount. The shares
of such series shall be designated as "Series A Junior
Participating Preferred Stock" and the number of shares
constituting such series shall be 165,000.
Section 2. Dividends and Distributions.
(A) The holders of shares of Series A Junior
Participating Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of
Directors out of funds legally available for the purpose,
quarterly dividends payable in cash on the last day of
March, June, September and December in each year (each
such date being referred to herein as a "Quarterly
Dividend Payment Date"), commencing on the first
Quarterly Dividend Payment Date after the first issuance
of a share or fraction of a share of Series A Junior
Participating Preferred Stock, in an amount per share
(rounded to the nearest cent) equal to the greater of (a)
$0.01 or (b) subject to the provision for adjustment
hereinafter set forth, 1,000 times the aggregate per
share amount of all cash dividends, and 1,000 times the
aggregate per share amount (payable in kind) of all
non-cash dividends or other distributions other than a
dividend payable in shares of Common Stock or a
subdivision of the outstanding shares of Common Stock (by
reclassification or otherwise), declared on the Common
Stock, par value $2.50 per share, of the Corporation (the
"Common Stock") since the immediately preceding Quarterly
Dividend Payment Date, or, with respect to the first
Quarterly Dividend Payment Date, since the first issuance
of any share or fraction of a share of Series A Junior
Participating Preferred Stock. In the event the
Corporation shall at any time after December 6, 1995 (the
"Rights Declaration Date") (i) declare any dividend on
Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding Common Stock, or (iii) combine
the outstanding Common Stock into a smaller number of
shares, then in each such case the amount to which
holders of shares of Series A Junior Participating
Preferred Stock were entitled immediately prior to such
event under clause (b) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such
event.
(B) The Corporation shall declare a dividend
or distribution on the Series A Junior Participating
Preferred Stock as provided in Paragraph (A) above
immediately after it declares a dividend or distribution
on the Common Stock (other than a dividend payable in
shares of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on the
Common Stock during the period between any Quarterly
Dividend Payment Date and the next subsequent Quarterly
Dividend Payment Date, a dividend of $0.01 per share on
the Series A Junior Participating Preferred Stock shall
nevertheless be payable on such subsequent Quarterly
Dividend Payment Date.
(C) Dividends shall begin to accrue and be
cumulative on outstanding shares of Series A Junior
Participating Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such
shares of Series A Junior Participating Preferred Stock,
unless the date of issue of such shares is prior to the
record date for the first Quarterly Dividend Payment
Date, in which case dividends on such shares shall begin
to accrue from the date of issue of such shares, or
unless the date of issue is a Quarterly Dividend Payment
Date or is a date after the record date for the
determination of holders of shares of Series A Junior
Participating Preferred Stock entitled to receive a
quarterly dividend and before such Quarterly Dividend
Payment Date, in either of which events such dividends
shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the
shares of Series A Junior Participating Preferred Stock
in an amount less than the total amount of such dividends
at the time accrued and payable on such shares shall be
allocated pro rata on a share-by-share basis among all
such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of
holders of shares of Series A Junior Participating
Preferred Stock entitled to receive payment of a dividend
or distribution declared thereon, which record date shall
be no more than 30 days prior to the date fixed for the
payment thereof.
Section 3. Voting Rights. The holders of
shares of Series A Junior Participating Preferred Stock
shall have the following voting rights:
(A) Subject to the provision for adjustment
hereinafter set forth, each share of Series A Junior
Participating Preferred Stock shall entitle the holder
thereof to 1,000 votes on all matters submitted to a vote
of the stockholders of the Corporation. In the event the
Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the
outstanding Common Stock, or (iii) combine the
outstanding Common Stock into a smaller number of shares,
then in each such case the number of votes per share to
which holders of shares of Series A Junior Participating
Preferred Stock were entitled immediately prior to such
event shall be adjusted by multiplying such number by a
fraction the numerator of which is the number of shares
of Common Stock outstanding immediately after such event
and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to
such event.
(B) Except as otherwise provided herein or by
law, the holders of shares of Series A Junior
Participating Preferred Stock and the holders of shares
of Common Stock shall vote together as one class on all
matters submitted to a vote of stockholders of the
Corporation.
(C) (i) If at any time dividends on
any Series A Junior Participating Preferred
Stock shall be in arrears in an amount equal to
six (6) quarterly dividends thereon, the
occurrence of such contingency shall mark the
beginning of a period (herein called a "default
period") which shall extend until such time
when all accrued and unpaid dividends for all
previous quarterly dividend periods and for the
current quarterly dividend period on all shares
of Series A Junior Participating Preferred
Stock then outstanding shall have been declared
and paid or set apart for payment. During each
default period, all holders of Preferred Stock
(including holders of the Series A Junior
Participating Preferred Stock) with dividends
in arrears in an amount equal to six (6)
quarterly dividends thereon, voting as a class,
irrespective of series, shall have the right to
elect two (2) Directors.
(ii) During any default period, such
voting right of the holders of Series A Junior
Participating Preferred Stock may be exercised
initially at a special meeting called pursuant
to subparagraph (iii) of this Section 3(C) or
at any annual meeting of stockholders, and
thereafter at annual meetings of stockholders,
provided that such voting right shall not be
exercised unless the holders of ten percent
(10%) in number of shares of Preferred Stock
outstanding shall be present in person or by
proxy. The absence of a quorum of the holders
of Common Stock shall not affect the exercise
by the holders of Preferred Stock of such
voting right. At any meeting at which the
holders of Preferred Stock shall exercise such
voting right initially during an existing
default period, they shall have the right,
voting as a class, to elect Directors to fill
such vacancies, if any, in the Board of
Directors as may then exist up to two (2)
Directors or, if such right is exercised at an
annual meeting, to elect two (2) Directors. If
the number which may be so elected at any
special meeting does not amount to the required
number, the holders of the Preferred Stock
shall have the right to make such increase in
the number of Directors as shall be necessary
to permit the election by them of the required
number. After the holders of the Preferred
Stock shall have exercised their right to elect
Directors in any default period and during the
continuance of such period, the number of
Directors shall not be increased or decreased
except by vote of the holders of Preferred
Stock as herein provided or pursuant to the
rights of any equity securities ranking senior
to or pari passu with the Series A Junior
Participating Preferred Stock.
(iii) Unless the holders of
Preferred Stock shall, during an existing
default period, have previously exercised their
right to elect Directors, the Board of
Directors may order, or any stockholder or
stockholders owning in the aggregate not less
than ten percent (10%) of the total number of
shares of Preferred Stock outstanding,
irrespective of series, may request, the
calling of special meeting of the holders of
Preferred Stock, which meeting shall thereupon
be called by the Chairman, the President, a
Vice-President or the Secretary of the
Corporation. Notice of such meeting and of any
annual meeting at which holders of Preferred
Stock are entitled to vote pursuant to this
Paragraph (C)(iii) shall be given to each
holder of record of Preferred Stock by mailing
a copy of such notice to him or her at his or
her last address as the same appears on the
books of the Corporation. Such meeting shall
be called for a time not earlier than 20 days
and not later than 60 days after such order or
request or in default of the calling of such
meeting within 60 days after such order or
request, such meeting may be called on similar
notice by any stockholder or stockholders
owning in the aggregate not less than ten
percent (10%) of the total number of shares of
Preferred Stock outstanding. Notwithstanding
the provisions of this Paragraph (C)(iii), no
such special meeting shall be called during the
period within 60 days immediately preceding the
date fixed for the next annual meeting of the
stockholders.
(iv) In any default period, the
holders of Common Stock, and other classes of
stock of the Corporation if applicable, shall
continue to be entitled to elect the whole
number of Directors until the holders of
Preferred Stock shall have exercised their
right to elect two (2) Directors voting as a
class, after the exercise of which right (x)
the Directors so elected by the holders of
Preferred Stock shall continue in office until
their successors shall have been elected by
such holders or until the expiration of the
default period, and (y) any vacancy in the
Board of Directors may (except as provided in
Paragraph (C)(ii) of this Section 3) be filled
by vote of a majority of the remaining
Directors theretofore elected by the holders of
the class of stock which elected the Director
whose office shall have become vacant.
References in this Paragraph (C) to Directors
elected by the holders of a particular class of
stock shall include Directors elected by such
Directors to fill vacancies as provided in
clause (y) of the foregoing sentence.
(v) Immediately upon the expiration
of a default period, (x) the right of the
holders of Preferred Stock as a class to elect
Directors shall cease, (y) the term of any
Directors elected by the holders of Preferred
Stock as a class shall terminate, and (z) the
number of Directors shall be such number as may
be provided for in the certificate of
incorporation or by-laws irrespective of any
increase made pursuant to the provisions of
Paragraph (C)(ii) of this Section 3 (such
number being subject, however, to change
thereafter in any manner provided by law or in
the certificate of incorporation or by-laws).
Any vacancies in the Board of Directors
effected by the provisions of clauses (y) and
(z) in the preceding sentence may be filled by
a majority of the remaining Directors.
(D) Except as set forth herein, holders of
Series A Junior Participating Preferred Stock shall have
no special voting rights and their consent shall not be
required (except to the extent they are entitled to vote
with holders of Common Stock as set forth herein) for
taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other
dividends or distributions payable on the Series A Junior
Participating Preferred Stock as provided in Section 2
are in arrears, thereafter and until all accrued and
unpaid dividends and distributions, whether or not
declared, on shares of Series A Junior Participating
Preferred Stock outstanding shall have been paid in full,
the Corporation shall not
(i) declare or pay dividends
on, make any other distributions on, or redeem
or purchase or otherwise acquire for
consideration any shares of stock ranking
junior (either as to dividends or upon
liquidation, dissolution or winding up) to the
Series A Junior Participating Preferred Stock;
(ii) declare or pay dividends
on or make any other distributions on any
shares of stock ranking on a parity (either as
to dividends or upon liquidation, dissolution
or winding up) with the Series A Junior
Participating Preferred Stock, except dividends
paid ratably on the Series A Junior
Participating Preferred Stock and all such
parity stock on which dividends are payable or
in arrears in proportion to the total amounts
to which the holders of all such shares are
then entitled;
(iii) redeem or purchase or
otherwise acquire for consideration shares of
any stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or
winding up) with the Series A Junior
Participating Preferred Stock, provided that
the Corporation may at any time redeem,
purchase or otherwise acquire shares of any
such parity stock in exchange for shares of any
stock of the Corporation ranking junior (either
as to dividends or upon dissolution,
liquidation or winding up) to the Series A
Junior Participating Preferred Stock; or
(iv) purchase or otherwise
acquire for consideration any shares of Series
A Junior Participating Preferred Stock, or any
shares of stock ranking on a parity with the
Series A Junior Participating Preferred Stock,
except in accordance with a purchase offer made
in writing or by publication (as determined by
the Board of Directors) to all holders of such
shares upon such terms as the Board of
Directors, after consideration of the
respective annual dividend rates and other
relative rights and preferences of the
respective series and classes, shall determine
in good faith will result in fair and equitable
treatment among the respective series or
classes.
(B) The Corporation shall not permit any
subsidiary of the Corporation to purchase or otherwise
acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under Paragraph
(A) of this Section 4, purchase or otherwise acquire such
shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of
Series A Junior Participating Preferred Stock purchased
or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after
the acquisition thereof. All such shares shall upon
their cancellation become authorized but unissued shares
of Preferred Stock and may be reissued as part of a new
series of Preferred Stock to be created by resolution or
resolutions of the Board of Directors, subject to the
conditions and restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding
Up. (A) Upon any liquidation (voluntary or otherwise),
dissolution or winding up of the Corporation, no
distribution shall be made to the holders of shares of
stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A
Junior Participating Preferred Stock unless, prior
thereto, the holders of shares of Series A Junior
Participating Preferred Stock shall have received an
amount equal to 1,000 times the Exercise Price, plus an
amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the
date of such payment (the "Series A Liquidation
Preference"). Following the payment of the full amount
of the Series A Liquidation Preference, no additional
distributions shall be made to the holders of shares of
Series A Junior Participating Preferred Stock unless,
prior thereto, the holders of shares of Common Stock
shall have received an amount per share (the "Common
Adjustment") equal to the quotient obtained by dividing
(i) the Series A Liquidation Preference by (ii) 1,000 (as
appropriately adjusted as set forth in subparagraph (C)
below to reflect such events as stock splits, stock
dividends and recapitalizations with respect to the
Common Stock) (such number in clause (ii), the
"Adjustment Number"). Following the payment of the full
amount of the Series A Liquidation Preference and the
Common Adjustment in respect of all outstanding shares of
Series A Junior Participating Preferred Stock and Common
Stock, respectively, holders of Series A Junior
Participating Preferred Stock and holders of shares of
Common Stock shall receive their ratable and
proportionate share of the remaining assets to be
distributed in the ratio of the Adjustment Number to 1
with respect to such Preferred Stock and Common Stock, on
a per share basis, respectively.
(B) In the event, however, that there are not
sufficient assets available to permit payment in full of
the Series A Liquidation Preference and the liquidation
preferences of all other series of preferred stock, if
any, which rank on a parity with the Series A Junior
Participating Preferred Stock, then such remaining assets
shall be distributed ratably to the holders of such
parity shares in proportion to their respective
liquidation preferences. In the event, however, that
there are not sufficient assets available to permit
payment in full of the Common Adjustment, then such
remaining assets shall be distributed ratably to the
holders of Common Stock.
(C) In the event the Corporation shall at any
time after the Rights Declaration Date (i) declare any
dividend on Common Stock payable in shares of Common
Stock, (ii) subdivide the outstanding Common Stock, or
(iii) combine the outstanding Common Stock into a smaller
number of shares, then in each such case the Adjustment
Number in effect immediately prior to such event shall be
adjusted by multiplying such Adjustment Number by a
fraction the numerator of which is the number of shares
of Common Stock outstanding immediately after such event
and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to
such event.
Section 7. Consolidation, Merger, etc. In
case the Corporation shall enter into any consolidation,
merger, combination or other transaction in which the
shares of Common Stock are exchanged for or changed into
other stock or securities, cash and/or any other
property, then in any such case the shares of Series A
Junior Participating Preferred Stock shall at the same
time be similarly exchanged or changed in an amount per
share (subject to the provision for adjustment
hereinafter set forth) equal to 1,000 times the aggregate
amount of stock, securities, cash and/or any other
property (payable in kind), as the case may be, into
which or for which each share of Common Stock is changed
or exchanged. In the event the Corporation shall at any
time after the Rights Declaration Date (i) declare any
dividend on Common Stock payable in shares of Common
Stock, (ii) subdivide the outstanding Common Stock, or
(iii) combine the outstanding Common Stock into a smaller
number of shares, then in each such case the amount set
forth in the preceding sentence with respect to the
exchange or change of shares of Series A Junior
Participating Preferred Stock shall be adjusted by
multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which
is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 8. No Redemption. The shares of
Series A Junior Participating Preferred Stock shall not
be redeemable.
Section 9. Amendment. The Amended and
Restated Certificate of Incorporation of the Corporation
shall not be further amended in any manner which would
materially alter or change the powers, preferences or
special rights of the Series A Junior Participating
Preferred Stock so as to affect them adversely without
the affirmative vote of the holders of a majority or more
of the outstanding shares of Series A Junior
Participating Preferred Stock, voting separately as a
class.
Section 10. Fractional Shares. Series A
Junior Participating Preferred Stock may be issued in
fractions of a share which shall entitle the holder, in
proportion to such holders fractional shares, to exercise
voting rights, receive dividends, participate in
distributions and to have the benefit of all other rights
of holders of Series A Junior Participating Preferred
Stock.
IN WITNESS WHEREOF, we have executed and
subscribed this Certificate and do affirm the foregoing
as true under the penalties of perjury this __th day of
, 1995.
HARTMARX CORPORATION
Name:
Title:
Attest:
Secretary
Exhibit B
[Form of Rights Certificate]
Certificate No. R- ________ Rights
NOT EXERCISABLE AFTER , 2006 OR EARLIER IF
REDEEMED BY THE COMPANY. THE RIGHTS ARE SUBJECT TO
REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.01 PER
RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.
UNDER CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY
AN ACQUIRING PERSON (AS SUCH TERM IS DEFINED IN THE
RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH
RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS REPRESENTED
BY THIS RIGHTS 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 OR (AS SUCH
TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY,
THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY
MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED
IN SECTION 7(e) OF SUCH AGREEMENT.](1)
Rights Certificate
HARTMARX CORPORATION
This certifies that , or
registered assigns, is the registered owner of the number
of Rights set forth above, each of which entitles the
owner thereof, subject to the terms, provisions and
conditions of the Rights Agreement, dated as of
, 1995 (the "Rights Agreement"), between Hartmarx
Corporation, a Delaware corporation (the "Company"), and
First Chicago Trust Company of New York, a New York
corporation (the "Rights Agent"), to purchase from the
Company at any time prior to 5:00 P.M. (Chicago time) on
, 2006 at the office or offices of the Rights
Agent designated for such purpose, or its successors as
Rights Agent, one one-thousandth of a fully paid, non-
assessable share of Series A Junior Participating
Preferred Stock (the "Preferred Stock") of the Company,
at a purchase price of $25 per one one-thousandth of a
share (the "Purchase Price"), upon presentation and
surrender of this Rights Certificate with the Form of
Election to Purchase and related Certificate duly
executed. The number of Rights evidenced by this Rights
Certificate (and the number of shares which may be
purchased upon exercise thereof) set forth above, and the
Purchase Price per share set forth above, are the number
and Purchase Price as of , 1995 based on the
Preferred Stock as constituted at such date. The Company
reserves the right to require prior to the occurrence of
a Triggering Event (as such term is defined in the Rights
1 The portion of the legend in brackets shall be
inserted only if applicable and shall replace the
preceding sentence.
Agreement) that a number of Rights be exercised so that
only whole shares of Preferred Stock will be issued.
Upon the occurrence of a Section 11(a)(ii)
Event (as such term is defined in the Rights Agreement),
if the Rights evidenced by this Rights Certificate are
beneficially owned by (i) an Acquiring Person or an
Affiliate or Associate of any such Acquiring Person (as
such terms are defined in the Rights Agreement), (ii) a
transferee of any such Acquiring Person, Associate or
Affiliate, or (iii) under certain circumstances specified
in the Rights Agreement, a transferee of a person who,
after such transfer, became an Acquiring Person, or an
Affiliate or Associate of an Acquiring Person, such
Rights shall become null and void and no holder hereof
shall have any right with respect to such Rights from and
after the occurrence of such Section 11(a)(ii) Event.
As provided in the Rights Agreement, the
Purchase Price and the number and kind of shares of
Preferred Stock or other securities, which may be
purchased upon the exercise of the Rights evidenced by
this Rights Certificate are subject to modification and
adjustment upon the happening of certain events,
including Triggering Events.
This Rights 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
Rights 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. Copies of the Rights Agreement are on
file at the above-mentioned office of the Rights Agent
and are also available upon written request to the Rights
Agent.
This Rights Certificate, with or without other
Rights Certificates, upon surrender at the principal
office or offices of the Rights Agent designated for such
purpose, may be exchanged for another Rights Certificate
or Rights Certificates of like tenor and date evidencing
Rights entitling the holder to purchase a like aggregate
number of one one-thousandths of a share of Preferred
Stock as the Rights evidenced by the Rights Certificate
or Rights Certificates surrendered shall have entitled
such holder to purchase. If this Rights Certificate
shall be exercised in part, the holder shall be entitled
to receive upon surrender hereof another Rights
Certificate or Rights Certificates for the number of
whole Rights not exercised.
Subject to the provisions of the Rights
Agreement, the Rights evidenced by this Certificate may
be redeemed by the Company at its option at a redemption
price of $0.01 per Right at any time prior to the earlier
of the close of business on (i) the tenth day following
the Stock Acquisition Date (as such time period may be
extended pursuant to the Rights Agreement), and (ii) the
Final Expiration Date. In addition, the Rights may be
exchanged, in whole or in part, for shares of the Common
Stock, or shares of preferred stock of the Company having
essentially the same value or economic rights as such
shares. Immediately upon the action of the Board of
Directors of the Company authorizing any such exchange,
and without any further action or any notice, the Rights
(other than Rights which are not subject to such
exchange) will terminate and the Rights will only enable
holders to receive the shares issuable upon such
exchange. Under certain circumstances set forth in the
Rights Agreement, the decision to redeem the Rights shall
require the concurrence of a majority of the Continuing
Directors.
No fractional shares of Preferred Stock will be
issued upon the exercise of any Right or Rights evidenced
hereby (other than fractions which are integral multiples
of one one-thousandth of a share of Preferred 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.
No holder of this Rights Certificate shall be
entitled to vote or receive dividends or be deemed for
any purpose the holder of shares of Preferred Stock or of
any other securities of the Company which may at any time
be issuable on the exercise hereof, nor shall anything
contained in the Rights Agreement or herein be construed
to confer upon the holder hereof, as such, any of the
rights of a stockholder of the Company or any right to
vote for the election of directors or upon any matter
submitted to stockholders at 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 Rights Certificate shall have been exercised as
provided in the Rights Agreement.
This Rights Certificate shall not be valid or
obligatory for any purpose until it shall have been
countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper
officers of the Company and its corporate seal.
Dated as of ,
ATTEST: HARTMARX CORPORATION
____________________ By_______________________
Secretary Title:
Countersigned:
First Chicago Trust Company
of New York
By______________________
Authorized Signature
[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Rights Certificate.)
FOR VALUE RECEIVED
hereby sells, assigns and transfer unto
(Please print name and address of transferee)
this Rights Certificate, together with all right, title
and interest therein, and does hereby irrevocably
constitute and appoint _________________ Attorney, to
transfer the within Rights 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) this Rights Certificate [ ] is [ ] is
not being sold, assigned and transferred 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 pursuant to 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 Rights Certificate
from any Person who is, was or subsequently became an
Acquiring Person or an Affiliate or Associate of an
Acquiring Person.
Dated: __________________, 19__ ______________________
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Assignment and
Certificate must correspond to the name as written upon
the face of this Rights Certificate in every particular,
without alteration or enlargement or any change
whatsoever.
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise Rights represented by the
Rights Certificate.)
To: HARTMARX CORPORATION
The undersigned hereby irrevocably elects to
exercise __________ Rights represented by this Rights
Certificate to purchase the shares of Preferred 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 shares 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 Rights Certificate, a new Rights
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 Rights
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 or
(as such terms are defined pursuant to 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 Rights Certificate
from any Person who is, was or became an Acquiring Person
or an Affiliate or Associate of an Acquiring Person.
Dated: ___________, 19__ ___________________________
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Election to
Purchase and Certificate must correspond to the name as
written upon the face of this Rights Certificate in every
particular, without alteration or enlargement or any
change whatsoever.
