SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
MediaOne Group, Inc.
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Delaware 84-0926774
(State of incorporation or organization) (IRS Employer
Identification No.)
188 Inverness Drive West, Englewood, CO 80112
(Address of principal executive offices) (Zip Code)
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If this form relates to the registration of a class of If this form relates to
the registration of a class of securities pursuant to Section 12(b) of the
Exchange Act securities pursuant to Section 12(g) of the Exchange and is
effective pursuant to General Instruction A.(c), Act and is effective pursuant
to General Instruction please check the following box. A.(d), please
check the following box.
Securities Act registration statement file number to which this form relates:
___________
(if applicable)
Securities to be registered pursuant to Section 12(b) of the Act:
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Title of each class Name of each exchange on which
to be so registered each class is to be registered
Rights to Purchase Series F Junior The New York Stock Exchange, Inc.
Participating Cumulative Preferred Stock The Pacific Exchange, Inc.
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Securities to be registered pursuant to Section 12(g) of the Act: None
Item 1. Description of Registrant's Securities to be Registered.
On February 5, 1999, the Board of Directors of MEDIAONE GROUP, INC.
(the "Corporation") declared a dividend distribution of one preferred stock
purchase right for each outstanding share of Common Stock, par value $0.01
per share (the "Common Stock"), of the Corporation held by stockholders of
record on April 6, 1999 (the "Record Date"). Each Right entitles the
registered holder to purchase from the Corporation one one-thousandth
(1/1,000) of a share of preferred stock of the Corporation, designated as
Series F Junior Participating Cumulative Preferred Stock (the "Preferred
Stock") at a price of $225 per one one-thousandth (1/1,000) of a share (the
"Exercise Price"). The description and terms of the Rights will be set forth in
a Rights Agreement (the "Rights Agreement") by and between the Corporation and
its Rights Agent (the "Rights Agent").
As discussed below, initially the Rights will not be exercisable,
certificates will not be sent to stockholders and the Rights will automatically
trade with the Common Stock.
The Rights, unless earlier redeemed by the Board of Directors, become
exercisable upon the close of business on the day (the "Distribution Date:)
which is the earlier of (i) the tenth day following the first date (the "Stock
Acquisition Date") on which there is a public announcement that a person or
group of affiliated or associated persons, with certain exceptions set forth
below, has acquired beneficial ownership of 15% or more of the outstanding
voting stock of the Corporation (an "Acquiring Person") or such earlier or later
date (not beyond the thirtieth day after the Stock Acquisition Date) as the
Board of Directors may determine or (ii) the tenth business day (or such later
date as may be determined by the Board of Directors prior to such time as any
person or group of affiliated or associated persons becomes an Acquiring Person)
after the date of the commencement or announcement of a person's or group's
intention to commence a tender or exchange offer the consummation of which would
result in the ownership of 15% or more of the Corporation's outstanding voting
stock (even if no shares are actually purchased pursuant to such offer); prior
thereto, the Rights will not be exercisable, will not be represented by a
separate certificate, and will not be transferable apart from the Common Stock,
but will instead be evidenced, (i) with respect to any of the shares of Common
Stock held in uncertificated book-entry form (a "Book-Entry") outstanding as of
the Record Date, by such Book-Entry and (ii) with respect to the shares of
Common Stock evidenced by Common Stock certificates outstanding as of the Record
Date, by such Common Stock certificate, together with a copy of this Summary of
Rights. An Acquiring Person does not include (A) the Corporation, (B) any
subsidiary of the Corporation, (C) any employee benefit plan or employee stock
plan of the Corporation or of any subsidiary of the Corporation, or any trust or
other entity organized, appointed, established or holding Common Stock for or
pursuant to the terms of any such plan or (D) any person or group whose
ownership of 15% or more of the shares of voting stock of the Corporation then
outstanding results solely from (i) any action or transaction or transactions
approved by the Board of Directors before such person or group became an
Acquiring Person or (ii) a reduction in the number of outstanding shares of
voting stock of the Corporation pursuant to a transaction or transactions
approved by the Board of Directors (provided that any person or group that does
not become an Acquiring Person by reason of clause (i) or (ii) above shall
become an Acquiring Person upon acquisition of an additional 1% or more of the
Corporation's voting stock then outstanding unless such acquisition of
additional voting stock will not result in such person or group becoming an
Acquiring Person by reason of such clause (i) or (ii). For purposes of the
foregoing, outstanding voting stock of the Corporation includes voting stock
that trades on a "when issued" basis on a national securities exchange or on the
National Association of Securities Dealers, Inc. Automated Quotation System
("NASDAQ").
Until the Distribution Date (or earlier redemption or expiration of the
Rights), new Common Stock certificates issued after April 6, 1999 will contain a
legend incorporating the Rights Agreement by reference. Until the Distribution
Date (or earlier redemption or expiration of the Rights), transfer on the
Corporation's Direct Registration System of any Common Stock represented by a
Book-Entry or a certificate outstanding as of April 6, 1999, and, in each case,
with or without a copy of this Summary of Rights attached thereto, will also
constitute the transfer of the Rights associated with the Common Stock
represented by such Book-Entry or certificate. As soon as practicable following
the Distribution Date, separate certificates evidencing the Rights ("Rights
Certificates") will be mailed to holders of record of the Common Stock as of the
close of business on the Distribution Date and such separate Rights Certificates
alone will evidence the Rights from and after the Distribution Date.
The Rights are not exercisable until the Distribution Date. Unless earlier
redeemed by the Corporation as described below, the Rights will expire at the
close of business on April 6, 2009 (the "Expiration Date") (or, if the
Distribution Date shall have occurred before April 6, 2009, at the close of
business on the 90th day following the Distribution Date).
The Preferred Stock is nonredeemable and, unless otherwise provided in
connection with the creation of a subsequent series of preferred stock, and (i)
pari passu with the Corporations Series A Junior Participating Cumulative
Preferred Stock and the Corporation's Series C Cumulative Redeemable Preferred
Stock, (ii) subordinate to any other series of the Corporation's preferred stock
and (iii) senior to the Common Stock. The Preferred Stock may not be issued
except upon exercise of Rights. Each share of Preferred Stock will be entitled
to receive when, as and if declared, a quarterly dividend in an amount equal to
(i) 1,000 times the cash dividends declared on the Corporation's Common Stock,
and (ii) a preferential cash dividend, if any, in preference to holders of
Common Stock in an amount equal to $25.00 per share of Preferred Stock less the
per share amount of all cash dividends declared on the Preferred Stock pursuant
to clause (i) since the immediately preceding quarterly dividend payment date.
In addition, Preferred Stock is entitled to 1,000 times any non-cash dividends
(other than dividends payable in equity securities) declared on the Common
Stock, in like kind. In the event of the liquidation of the Corporation, the
holders of Preferred Stock will be entitled to receive, for each share of
Preferred Stock, a payment in an amount equal to the greater of $1.00 per one
one-thousandth of a share plus accrued and unpaid dividends and distributions
thereon or 1,000 times the payment made per share of Common Stock. Each share of
Preferred Stock will have 1,000 votes, voting together with the Common Stock. In
the event of any merger, consolidation or other transaction in which Common
Stock is exchanged, each share of Preferred Stock will be entitled to receive
1,000 times the amount received per share of Common Stock. The rights of
Preferred Stock as to dividends, liquidation and voting are protected by
anti-dilution provisions. If the dividends accrued on the Preferred Stock for
four or more quarterly dividend periods, whether consecutive or not, shall not
have been declared and paid or irrevocably set aside for payment, the holders of
record of the Preferred Stock of the Corporation of all series (including the
Preferred Stock) will have the right to elect two members to the Corporation's
Board of Directors.
The number of shares of Preferred Stock issuable upon exercise of the
Rights is subject to certain adjustments from time to time in the event of a
stock dividend on, or a subdivision or combination of, the Common Stock. The
Exercise Price for the Rights is subject to adjustment in the event of
extraordinary distributions of cash or other property to holders of Common
Stock.
Unless the Rights are earlier redeemed, in the event that, after the time
that a Person becomes an Acquiring Person, the Corporation were to be acquired
in a merger or other business combination (in which any shares of Common Stock
are changed into or exchanged for other securities or assets) or more than 50%
of the assets or earning power of the Corporation and its subsidiaries (taken as
a whole) were to be sold or transferred in one or a series of related
transactions, the Rights Agreement provides that proper provision will be made
so that each holder of record, other than the Acquiring Person, of a Right will
from and after such date have the right to receive, upon payment of the Exercise
Price, that number of shares of common stock of the acquiring company having a
market value at the time of such transaction equal to two times the Exercise
Price.
In addition, unless the Rights are earlier redeemed, in the event that a
person or group becomes an Acquiring Person, the Rights Agreement provides that
proper provision will be made so that each holder of record of a Right, other
than the Acquiring Person (whose Rights will thereupon become null and void),
will thereafter have the right to receive, upon payment of the Exercise Price,
that number of one one-thousandths of a share of Preferred Stock having a market
value at the time of the transaction equal to two times the Exercise Price (such
market value to be determined with reference to the market value of the
Corporation's Common Stock as provided in the Rights Agreement).
At any time after any person or group becomes an Acquiring Person and prior
to the acquisition by such person or group of 50% or more of the outstanding
voting stock, the Board of Directors of the Corporation may exchange the Rights
(other than Rights owned by such person or group which will have become void),
in whole or in part, at an exchange ratio of one share of Common Stock per Right
(subject to adjustment).
Fractions of shares of Preferred Stock (other than fractions which are
integral multiples of one one-thousandth of a share) may, at the election of the
Corporation, be evidenced by depositary receipts. The Corporation may also issue
cash in lieu of fractional shares which are not integral multiples of one
one-thousandth of a share.
At any time on or prior to the close of business on the earlier of (i) the
tenth day after the Stock Acquisition Date (or such later date as a majority of
the Board of Directors may determine) or (ii) the Expiration Date, the
Corporation may redeem the Rights in whole, but not in part, at a price of
$0.005 per Right (the "Redemption Price"). Immediately upon the effective time
of the action of the Board of Directors of the Corporation authorizing
redemption of the Rights, the right to exercise the Rights will terminate and
the only right of the holders of Rights will be to receive the Redemption Price.
For as long as the Rights are then redeemable, the Corporation may, except
with respect to the redemption price or date of expiration of the Rights, amend
the Rights in any manner, including an amendment to extend the time period in
which the Rights may be redeemed. At any time when the Rights are not then
redeemable, the Corporation may amend the Rights in any manner that does not
materially adversely affect the interests of holders of the Rights as such.
Amendments to the Rights Agreement from and after the time that any Person
becomes an Acquiring Person and amendments to the redemption price or expiration
date of the Rights require the approval of a majority of the Continuing
Directors (as defined and provided in the Rights Agreement).
Until a Right is exercised, the holder, as such, will have no rights as a
stockholder of the Company, including, without limitation, the right to vote or
to receive dividends.
As of January 29, 1999 there were 631,649,722 shares of Common Stock issued
(of which 604,359,873 shares were outstanding and 27,289,849 shares were held in
treasury) and 25,779,609 shares reserved for issuance pursuant to employee
benefit plans. As long as the Rights are attached to the Common Stock, the
Company will issue one Right with each new share of Common Stock so that all
such shares will have Rights attached. The Company's Board of Directors has
reserved for issuance upon exercise of the Rights 2,000,000 shares of Series F
Junior Participating Cumulative Preferred Stock.
The Rights Agreement (which includes as Exhibit B the forms of Rights
Certificates and Election to Purchase and as Exhibit C the form of Certificate
of Designations of Series F Junior Participating Cumulative Preferred Stock) is
attached hereto as an exhibit and is incorporated herein by reference. The
foregoing description of the Rights is qualified in its entirety by reference to
the Rights Agreement and such exhibits thereto.
Item 2. Exhibits.
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Exhibit No. Description
(1) Form of Rights Agreement by and between MediaOne Group,
Inc. and the Rights Agent.
(2) Forms of Rights Certificate and of Election to Pur-
chase, included in Exhibit B to the Rights Agreement.
(3) Form of Certificate of Designations of Series F Junior
Participating Cumulative Preferred Stock, included
in Exhibit C to the Rights Agreement.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the registrant has duly caused this registration statement to be signed
on its behalf by the undersigned, thereunto duly authorized.
MEDIAONE GROUP, INC.
/s/ Stephen E. Brilz
By: _____________________________________
Name: Stephen E. Brilz
Title: Assistant Secretary
Date: March 29, 1999
EXHIBIT INDEX
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Exhibit No. Description
(1) Form of Rights Agreement (the "Rights Agreement")
by and between MediaOne Group, Inc. and its
Rights Agent (the Rights Agent).
(2) Forms of Rights Certificate and of Election to
Purchase, included in Exhibit B to the Rights
Agreement.
(3) Form of Certificate of Designations of Series F
Junior Participating Cumulative Preferred Stock,
included in Exhibit C to the Rights Agreement.
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RIGHTS AGREEMENT
by and between
MEDIAONE GROUP, INC.
and
the
Rights Agent
TABLE OF CONTENTS
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Page
Section 1. Certain Definitions...................................................................................2
Section 2. Appointment of Rights Agent..........................................................................10
Section 3. Issuance of Rights Certificates......................................................................10
Section 4. Form of Rights Certificates..........................................................................13
Section 5. Countersignature and Registration....................................................................14
Section 6. Transfer, Split Up, Combination and Exchange of Rights Certificates; Mutilated, Destroyed, Lost or Stolen
Rights Certificates........................................................................15
Section 7. Exercise of Rights; Exercise Price; Expiration Date of Rights........................................17
Section 8. Cancellation and Destruction of Rights Certificates..................................................21
Section 9. Reservation and Availability of Shares of Preferred Stock............................................21
Section 10. Preferred Stock Record Date.........................................................................23
Section 11. Adjustment of Exercise Price or Number of Shares....................................................24
Section 12. Certification of Adjusted Exercise Price or Number of Shares........................................31
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power................................32
Section 14. Fractional Rights and Fractional Shares.............................................................37
Section 15. Rights of Action....................................................................................39
Section 16. Agreement of Right Holders..........................................................................39
Section 17. Rights Certificate Holder Not Deemed a Stockholder..................................................41
Section 18. Concerning the Rights Agent.........................................................................41
Section 19. Merger or Consolidation of, or Change in Name of, the Rights Agent..................................42
Section 20. Duties of Rights Agent..............................................................................43
Section 21. Change of Rights Agent..............................................................................46
Section 22. Issuance of New Rights Certificates.................................................................47
Section 23. Redemption..........................................................................................48
Section 24. Notice of Proposed Actions..........................................................................49
Section 25. Notices 51
Section 26. Supplements and Amendments..........................................................................52
Section 27. Exchange 53
Section 28. Successors..........................................................................................54
Section 29. Benefits of this Rights Agreement...................................................................54
Section 30. Delaware Contract...................................................................................55
Section 31. Counterparts........................................................................................55
Section 32. Descriptive Headings................................................................................55
Section 33. Severability........................................................................................55
Section 34. Determinations And Actions By The Board Of Directors, Etc..........................................56
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Exhibit A Summary of Rights
Exhibit B Form of Rights Certificate
Exhibit C Form of Certificate of Designations Relating to the Terms of the Series F Junior Participating Cumulative
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Preferred Stock
RIGHTS AGREEMENT
Agreement by and between MediaOne Group, Inc., a Delaware corporation
(the "Corporation")and its Rights Agent (the "Rights Agent").
W I T N E S S E T H:
WHEREAS, on February 5, 1999, the Board of Directors of the
Corporation authorized the issuance of, and declared a dividend payable in,
one right (a "Right") for each share of Common Stock, $0.01 par value per
share, of the Corporation outstanding as of the close of business on April
6, 1999 (the "Record Date"), each such Right representing the right to
purchase one one-thousandth of a share of Series F Junior Participating
Cumulative Preferred Stock of the Corporation (the "Preferred Stock")
having the rights and preferences set forth in the Certificate of
Designations attached hereto as Exhibit C, authorized by the Board of
Directors on February 5, 1999, upon the terms and subject to the conditions
hereinafter set forth; and
WHEREAS, the Board of Directors of the Corporation further authorized the
issuance of one Right (subject to adjustment) with respect to each share of
Common Stock which may be issued between the Record Date and the earlier to
occur of the Distribution Date or the Expiration Date (as such terms are
hereinafter defined);
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 shall have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as such term is hereinafter
defined) who or which, together with all Affiliates (as such term is
hereinafter defined) and Associates (as such term is hereinafter defined)
of such Person, is the Beneficial Owner (as such term is hereinafter
defined) of 15% or more of the Voting Stock (as such term is hereinafter
defined) of the Corporation then outstanding; provided, that, an Acquiring
Person shall not include (i) an Exempt Person (as such term is hereinafter
defined) or (ii) any Person, together with all Affiliates and Associates of
such Person, who or which would be an Acquiring Person solely by reason of
(A) being the Beneficial Owner of shares of Voting Stock of the
Corporation, the Beneficial Ownership of which was acquired by such Person
(or his or its predecessor through merger, consolidation, amalgamation or
other similar legal succession) pursuant to any action or transaction or
series of related actions or transactions approved by the Board of
Directors before such Person otherwise became an Acquiring Person or (B) a
reduction in the number of outstanding shares of Voting Stock of the
Corporation pursuant to a transaction or a series of related transactions
approved by the Board of Directors of the Corporation; provided, further,
that in the event such Person described in this clause (ii) does not become
an Acquiring Person by reason of subclause (A) or (B) of this clause (ii),
such Person nonetheless shall become an Acquiring Person in the event such
Person thereafter acquires Beneficial Ownership of an additional 1% or more
of the Voting Stock of the Corporation then outstanding, unless the
acquisition of such additional Voting Stock would not result in such Person
becoming an Acquiring Person by reason of subclause (A) or (B) of this
clause (ii). Notwithstanding the foregoing, if the Board of Directors of
the Corporation determines in good faith that a Person who would otherwise
be an "Acquiring Person" as defined pursuant to the foregoing provisions of
this paragraph (a) has become such inadvertently, and such Person divests
as promptly as practicable (as determined in good faith by the Board of
Directors) a sufficient number of shares of Common Stock so that such
Person would no longer be an "Acquiring Person" as defined pursuant to the
foregoing provisions of this paragraph (a), then such Person shall not be
deemed an "Acquiring Person" for any purposes of this Rights Agreement.
(b) "Affiliate" shall have the meaning ascribed to such term in Rule 12b-2 of
the General Rules and Regulations under the Securities Exchange Act of
1934, as amended ("Exchange Act"), as in effect on the date of this Rights
Agreement.
(c) "Associate" of a Person (as such term is hereinafter defined) shall mean
(i) with respect to a corporation, any officer or director thereof or of
any Subsidiary (as such term is hereinafter defined) thereof, or any
Beneficial Owner (as such term is hereinafter defined) of 10% or more of
any class of equity security thereof, (ii) with respect to an association,
joint venture or other unincorporated organization, any officer or director
thereof or of a Subsidiary thereof or any Beneficial Owner of 10% or more
ownership interest therein, (iii) with respect to a partnership, any
general partner thereof or any limited partner thereof who is, directly or
indirectly, the Beneficial Owner of a 10% or greater ownership interest
therein, (iv) with respect to a limited liability company, any officer,
director or manager thereof or of a Subsidiary thereof or any member
thereof who is, directly or indirectly, the Beneficial Owner of a 10% or
greater ownership interest therein, (v) with respect to a business trust,
any officer or trustee thereof or of any Subsidiary thereof, (vi) with
respect to any other trust or an estate, any trustee, executor or similar
fiduciary or any Person who has a 10% or greater interest as a beneficiary
in the income from or principal of such trust or estate, (vii) with respect
to a natural person, any relative or spouse of such person, or any relative
of such spouse, who has the same home as such person, and (viii) any
Affiliate of such Person.
(d) A person shall be deemed the "Beneficial Owner" of, or to "Beneficially
Own," any securities (and correlative terms shall have correlative
meanings):
(i) which such Person or any of such Person's Affiliates or Associates
beneficially owns, directly or indirectly, for purposes of Section
13(d) of the Exchange Act and Regulations 13D and 13G thereunder, in
each case as in effect on the date hereof; or
(ii) which such Person or any of such Person's Affiliates or Associates has
(A) the right to acquire (whether such right is exercisable
immediately or only after the passage of time or the fulfillment of a
condition or both) pursuant to any agreement, arrangement or
understanding (whether or not in writing), or upon the exercise of
conversion rights, exchange rights, other rights (other than these
Rights), warrants or options, or otherwise; provided, however, that a
Person shall not be deemed the "Beneficial Owner" of, or to
"Beneficially Own," securities tendered pursuant to a tender or
exchange offer made by or on behalf of such Person or any of such
Person's Affiliates or Associates until such tendered securities are
accepted for purchase or exchange or (B) the right to vote, alone or
in concert with others, 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 securities if the agreement, arrangement or
understanding to vote such security (1) arises solely from a revocable
proxy or consent given in response to a proxy or consent solicitation
made pursuant to, and in accordance with, the applicable rules and
regulations under the Exchange Act and (2) is not at that time
reportable by such Person on a Schedule 13D report under the Exchange
Act (or any comparable or successor report), other than by reference
to a proxy or consent solicitation being conducted by such Person; or
(iii)which are Beneficially Owned, directly or indirectly, by any other
Person with which such Person or any of such Person's Affiliates or
Associates has any agreement, arrangement or understanding (whether or
not in writing) for the purpose of acquiring, holding, voting (except
as described in the proviso in clause (B) of subparagraph (ii) of this
paragraph (d)) or disposing of any securities of the Corporation;
provided, however, that for purposes of determining Beneficial
Ownership of securities under this Rights Agreement, officers and
directors of the Corporation solely by reason of their status as such
shall not constitute a group (notwithstanding that they may be
Associates of one another or may be deemed to constitute a group for
purposes of Section 13(d) of the Exchange Act) and shall not be deemed
to own shares owned by another officer or director of the Corporation.
Notwithstanding anything in this paragraph (d) to the contrary, a
Person engaged in the business of underwriting securities shall not
be deemed the "Beneficial Owner" of, or to "Beneficially Own," any
securities acquired in good faith in a firm commitment underwriting,
until the expiration of forty days after the date of such acquisition.
(e) "Book-Entry" shall mean an uncertificated book-entry for the Corporation's
Common Stock.
(f) "Business Day" shall mean any day other than a Saturday, Sunday, or day on
which banking institutions in the State of New York or Colorado are
authorized or obligated by law or executive order to close.
(g) "Close of Business" on any given date shall mean 5:00 p.m., New York City
time, on such date; provided, however, that if such date is not a Business
Day it shall mean 5:00 p.m., New York City time, on the next succeeding
Business Day.
(h) "Common Stock," when used with reference to the Corporation, shall mean the
common stock, $0.01 par value, of the Corporation. "Common Stock," when
used with reference to any Person other than the Corporation which shall be
organized in corporate form, shall mean the capital stock or other equity
security with the greatest voting power of such Person. "Common Stock,"
when used with reference to any Person other than the Corporation which
shall not be organized in corporate form, shall mean units of beneficial
interest which shall represent the right to participate in profits, losses,
deductions and credits of such Person and which shall be entitled to
exercise the greatest voting power of such Person.
(i) "Continuing Director" shall mean any member of the Board of Directors,
while such person is a member of the Board of Directors, who is not an
Acquiring Person, or an Affiliate or Associate of an Acquiring Person, or a
representative or nominee of an Acquiring Person or of any such Affiliate
or Associate, and who either (i) was a member of the Board of Directors
prior to the time that any Person became an Acquiring Person or
(ii) subsequently became a member of the Board of Directors, and whose
nomination for election or election to the Board of Directors was
recommended or approved by at least a majority of the Continuing Directors
then on the Board of Directors or by the sole remaining Continuing Director
then on the Board of Directors.
(j) "Distribution Date" shall have the meaning set forth in Section 3(b)
hereof.
(k) "Exchange Act" shall have the meaning set forth in Section 1(b) hereof.
(l) "Exempt Person" shall mean (i) the Corporation, (ii) any Subsidiary of the
Corporation or (iii) any employee benefit plan or employee stock plan of
the Corporation or any Subsidiary of the Corporation, or any trust or other
entity organized, appointed, established or holding Common Stock for or
pursuant to the terms of any such plan.
(m) "Exercise Price" shall have the meaning set forth in Sections 4 and 7(b)
hereof.
(n) "Expiration Date" shall have the meaning set forth in Section 7(a) hereof
(o) "Fair Market Value" of any property shall mean the fair market value of
such property as determined in accordance with Section 11(b) hereof.
(p) "NASDAQ" shall mean the National Association of Securities Dealers, Inc.
Automated Quotation System or any successor thereto or other comparable
quotation system.
(q) "Person" shall mean any individual, firm, corporation or other entity.
(r) "Principal Party" shall have the meaning set forth in Section 13(b) hereof.
(s) "Record Date" shall have the meaning set forth in the first Recital.
(t) "Redemption Price" shall have the meaning set forth in Section 23(a)
hereof.
(u) "Rights Certificate" shall have the meaning set forth in Section 3(d)
hereof.
(v) "Stock Acquisition Date" shall mean the first date on which there shall be
a public announcement by the Corporation or an Acquiring Person that an
Acquiring Person has become such (which, for purposes of this definition,
shall include, without limitation, a report filed pursuant to Section 13(d)
of the Exchange Act) or such earlier date as a majority of the Board of
Directors shall become aware of the existence of an Acquiring Person.
(w) "Subsidiary" of a Person shall mean any corporation or other entity of
which securities or other ownership interests having voting power
sufficient to elect a majority of the Board of Directors or other persons
performing similar functions are Beneficially Owned, directly or
indirectly, by such Person or by any corporation or other entity that is
otherwise controlled by such Person.
(x) "Summary of Rights" shall have the meaning set forth in Section 3(a)
hereof.
(y) "Trading Day" shall have the meaning set forth in Section 11(b) hereof.
(z) "Transfer Ta" shall mean any tax or charge, including any documentary
stamp tax, imposed or collected by any governmental or regulatory authority
in respect of any transfer of any security, instrument or right, including
Rights, shares of Common Stock and shares of Preferred Stock.
(aa) "Voting Stock" shall mean (i) the Common Stock of the Corporation and (ii)
any other shares of capital stock of the Corporation entitled to vote
generally in the election of directors or entitled to vote together with
the Common Stock in respect of any merger, consolidation, sale of all or
substantially all of the Corporation's assets, liquidation, dissolution or
winding up. For purposes of this Agreement, Voting Stock shall include
securities of the type referred to in clauses (i) and (ii) above that trade
on a "when issued" basis on a national securities exchange or on the
NASDAQ. For purposes of this Agreement, a stated percentage of the Voting
Stock shall mean a number of shares of the Voting Stock as shall equal in
voting power that stated percentage of the total voting power of the then
outstanding shares of Voting Stock in the election of a majority of the
Board of Directors or in respect of any merger, consolidation, sale of all
or substantially all of the Corporation's assets, liquidation, dissolution
or winding up.
Any determination required to be made by the Board of Directors of the
Corporation for purposes of applying the definitions contained in this Section 1
shall be made by the Board of Directors in its good faith judgment, and such
determination shall be binding on the Rights Agent and the holders of the
Rights.
Section 2. Appointment of Rights Agent.
The Corporation hereby appoints the Rights Agent to act as agent for
the Corporation and the holders of the Rights in accordance with the terms
and conditions hereof, and the Rights Agent hereby accepts such
appointment. The Corporation may from time to time appoint such Co-Rights
Agents as it may deem necessary or desirable.
Section 3. Issuance of Rights Certificates.
(a) On the Record Date (or as soon as practicable thereafter), the Corporation
or the Rights Agent shall send a copy of a Summary of Rights, in
substantially the form attached hereto as Exhibit A or such other form as
may be acceptable to the Corporation (the "Summary of Rights"), by first
class mail, postage prepaid, to each record holder of the Common Stock as
of the Close of Business on the Record Date, at the address of such holder
shown on the records of the Corporation.
(b) Until the Close of Business on the day which is the earlier of (i) the
tenth day after the Stock Acquisition Date or such earlier or later date
(not beyond the thirtieth day after the Stock Acquisition Date) as the
Board of Directors may from time to time fix by resolution adopted prior to
the Distribution Date that otherwise would have occurred or (ii) the tenth
business day (or such later date as may be determined by action of the
Board of Directors prior to such time as any Person becomes an Acquiring
Person) after the date of the commencement by any Person (other than an
Exempt Person) of, or the first public announcement of the intent of any
Person (other than an Exempt Person) to commence, a tender or exchange
offer upon the successful consummation of which such Person, together with
its Affiliates and Associates, would be the Beneficial Owner of 15% or more
of the then outstanding shares of Voting Stock of the Corporation
(irrespective of whether any shares are actually purchased pursuant to any
such offer) (the earlier of such dates being herein referred to as the
"Distribution Date"), (x) the Rights shall be evidenced by the
Book-Entries, or certificates for, Common Stock registered in the name of
the holders of Common Stock (together with, in the case of Book-Entries
representing, or the certificates for, Common Stock outstanding as of the
Record Date, the Summary of Rights) and not by separate Book-Entries or
Rights Certificates and the record holders of the Common Stock represented
by such Book-Entries or certificates shall be the record holders of the
Rights represented thereby and (y) each Right shall be transferable only
simultaneously and together with the transfer of a share of Common Stock
(subject to adjustment as hereinafter provided). Until the Distribution
Date (or, if earlier, the Expiration Date), transfer on the Corporation's
Direct Registration System of any Common Stock represented by a Book-Entry
or the surrender for transfer of any certificate for Common Stock shall
constitute the surrender for transfer of the Right or Rights associated
with the Common Stock evidenced thereby, whether or not accompanied by a
copy of the Summary of Rights.
(c) Rights shall be issued in respect of all shares of Common Stock that become
outstanding after the Record Date but prior to the earlier of the
Distribution Date or the Expiration Date and, in certain circumstances
provided in Section 22 hereof, may be issued in respect of shares of Common
Stock that become outstanding after the Distribution Date. Certificates for
Common Stock (including, without limitation, certificates issued upon
original issuance, dispensation from the Corporation's treasury or transfer
or exchange of Common Stock) after the Record Date but prior to the
earliest of the Distribution Date or the Expiration Date (or, in certain
circumstances as provided in Section 22 hereof, after the Distribution
Date) shall have impressed, printed, written or stamped thereon or
otherwise affixed thereto the following legend:
This certificate also evidences and entitles the holder hereof to the same
number of Rights (subject to adjustment) as the number of shares of Common Stock
represented by this certificate, such Rights being on the terms provided under
the Rights Agreement between MediaOne Group, Inc. (the "Corporation") and its
Rights Agent (the "Rights Agent"), as it may be amended from time to time (the
"Rights Agreement"), the terms of which are incorporated herein by reference and
a copy of which is on file at the principal executive offices of the
Corporation. Under certain circumstances, as set forth in the Rights Agreement,
such Rights shall be evidenced by separate certificates and shall no longer be
evidenced by this certificate. The Corporation shall mail to the registered
holder of this certificate a copy of the Rights Agreement without charge within
five days after receipt of a written request therefor. UNDER CERTAIN
CIRCUMSTANCES AS PROVIDED IN SECTION 7(e) OF THE RIGHTS AGREEMENT, RIGHTS ISSUED
TO OR BENEFICIALLY OWNED BY ACQUIRING PERSONS OR THEIR AFFILIATES OR ASSOCIATES
(AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF
SUCH RIGHTS SHALL BE NULL AND VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.
(d) As soon as practicable after the Distribution Date, the Corporation will
prepare and execute, the Rights Agent will countersign, and the Corporation
will send or cause to be sent (and the Rights Agent will, if requested,
send), by first class mail, postage prepaid, to each record holder of the
Common Stock as of the Close of Business on the Distribution Date, as shown
by the records of the Corporation, at the address of such holder shown on
such records, a certificate in the form provided by Section 4 hereof (a
"Rights Certificate"), evidencing one Right (subject to adjustment as
provided herein) for each share of Common Stock so held. As of and after
the Distribution Date, the Rights shall be evidenced solely by such Rights
Certificates and may be transferred by the transfer of the Rights
Certificate as permitted hereby, separately and apart from any transfer of
one or more shares of Common Stock.
(e) In addition, in connection with the issuance or sale of shares of Common
Stock following the Distribution Date and prior to the Expiration Date, the
Corporation (i) shall, with respect to shares of Common Stock so issued or
sold (x) pursuant to the exercise of stock options or under any employee
plan or arrangement or (y) upon the exercise, conversion or exchange of
other securities issued by the Corporation prior to the Distribution Date
and (ii) may, in any other case, if deemed necessary or appropriate by the
Board of Directors of the Corporation, issue Rights Certificates
representing the appropriate number of Rights in connection with such
issuance or sale; provided that no such Rights Certificate shall be issued
if, and to the extent that, (i) the Corporation shall be advised by counsel
that such issuance would create a significant risk of material adverse tax
consequences to the Corporation or the Person to whom such Rights
Certificate would be issued or (ii) appropriate adjustment shall otherwise
have been made in lieu of the issuance thereof.
Section 4. Form of Rights Certificates.
(a) The Rights Certificates (and the forms of election to purchase shares,
certificate and assignment to be printed on the reverse thereof), when, as
and if issued, shall 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 may be required to
comply with any law or with any rule or regulation made pursuant thereto or
with any rule or regulation of any stock exchange on which the Common Stock
or the Rights may from time to time be listed or as the Corporation may
deem appropriate to conform to usage or otherwise and as are not
inconsistent with the provisions of this Rights Agreement. Subject to the
provisions of Section 22 hereof, Rights Certificates evidencing Rights
whenever issued, (i) shall be dated as of the date of issuance of the
Rights they represent and (ii) subject to adjustment from time to time as
provided herein, on their face shall entitle the holders thereof to
purchase such number of shares (including fractional shares which are
integral multiples of one one-thousandth of a share) of Preferred Stock as
shall be set forth therein at the price payable upon exercise of a Right
provided by Section 7(b) hereof as the same may from time to time be
adjusted as provided herein (the "Exercise Price").
(b) Notwithstanding any other provision of this Rights Agreement, any Rights
Certificate that represents Rights Beneficially Owned by an Acquiring
Person or any Affiliate or Associate thereof or any other Person whose
Rights shall become void pursuant to Section 7(e) shall have impressed on,
printed on, written on or otherwise affixed to it (if the Corporation or
the Rights Agent has knowledge that such Person is an Acquiring Person or
an Associate or Affiliate or a nominee of any of the foregoing) the
following legend:
The Beneficial Owner of the Rights represented by this Rights Certificate
is an Acquiring Person or an Affiliate or an Associate of an Acquiring Person.
Accordingly, this Rights Certificate and the Rights represented hereby shall
become void in the circumstances specified in Section 7(e) of the Rights
Agreement.
Section 5. Countersignature and Registration.
(a) Each Rights Certificate shall be executed on behalf of the Corporation by
its Chairman of the Board, President or any Vice President, either manually
or by facsimile signature, and have affixed thereto the Corporation's seal
or a facsimile thereof which shall be attested to by the Secretary or an
Assistant Secretary of the Corporation, either manually or by facsimile
signature. Each Rights Certificate 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 Corporation
who shall have signed any Rights Certificate shall cease to be such officer
of the Corporation before countersignature by the Rights Agent and issuance
and delivery of the certificate by the Corporation, such Rights
Certificate, nevertheless, may be countersigned by the Rights Agent and
issued and delivered with the same force and effect as though the person
who signed such Rights Certificates had not ceased to be such officer of
the Corporation. Any Rights Certificate may be signed on behalf of the
Corporation by any person who, on the date of the execution of such Rights
Certificate, shall be a proper officer of the Corporation 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 one or more offices designated as the
appropriate place for the surrender of Rights Certificates upon exercise or
transfer, and in such other locations as may be required by law, 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 Sections 7(e), 7(f) and 14(b) 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,
may be (i) transferred or (ii) split up, combined or exchanged for one or
more other Rights Certificates, entitling the registered holder to purchase
a like number of shares of Preferred Stock as the Rights Certificate or
Rights Certificates surrendered then entitled such holder to purchase. Any
registered holder desiring to transfer any Rights Certificate shall
surrender the Rights Certificate at the office of the Rights Agent
designated for the surrender of Rights Certificates with the form of
certificate and assignment on the reverse side thereof duly endorsed (or,
enclosed with such Rights Certificate, a written instrument of transfer in
a form satisfactory to the Corporation and the Rights Agent), duly executed
by the registered holder thereof or his attorney duly authorized in
writing, and with such signature duly guaranteed. Any registered holder
desiring to split up, combine or exchange any Rights Certificate shall make
such request in writing delivered to the Rights Agent, and shall surrender
the Rights Certificate to be split up, combined or exchanged at the office
of the Rights Agent. Thereupon, the Rights Agent shall countersign and
deliver to the person entitled thereto a Rights Certificate or Rights
Certificates, as the case may be, as so requested. The Corporation may
require payment of a sum sufficient to cover any Transfer Tax that may be
imposed in connection with any transfer, split up, combination or exchange
of any Rights Certificates.
(b) Subject to the provisions of Sections 7(e), 7(f) and 14(b) hereof, upon
receipt by the Corporation 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, if requested by
the Corporation, reimbursement to the Corporation and the Rights Agent of
all reasonable expenses incidental thereto, or upon surrender to the Rights
Agent and cancellation of the Rights Certificate if mutilated, the
Corporation shall issue and deliver a new Rights Certificate of like tenor
to the Rights Agent for delivery to the registered owner in lieu of the
Rights Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Exercise Price; Expiration Date of Rights.
(a) The Rights shall not be exercisable until, and shall become exercisable on,
the Distribution Date (unless otherwise provided herein, including, without
limitation, the restrictions on exercisability set forth in Section 7(e)
and 23(a) hereof). Except as otherwise provided herein, the Rights may be
exercised, in whole or in part, at any time commencing with the
Distribution Date upon surrender of the Rights Certificate, with the form
of election to purchase and certificate on the reverse side thereof duly
executed (with signatures duly guaranteed), to the Rights Agent at the
principal office of the Rights Agent , together with payment of the
Exercise Price for each Right exercised, subject to adjustment as
hereinafter provided, at or prior to the Close of Business on the earlier
of (i) April 6, 2009 (or if the Distribution Date shall have occurred
before April 6, 2009, at the Close of Business on the 90th day following
the Distribution Date) or (ii) the date on which the Rights are redeemed as
provided in Section 23 hereof (such earlier date being herein referred to
as the "Expiration Date").
(b) The Exercise Price shall initially be $225 for each one one-thousandth
(1/1,000) of a share of Preferred Stock issued pursuant to the exercise of
a Right. The Exercise Price and the number of shares of Preferred Stock or
other securities to be acquired upon exercise of a Right shall be subject
to adjustment from time to time as provided in Sections 11 and 13 hereof.
The Exercise Price shall be payable in lawful money of the United States of
America, in accordance with paragraph (c) below.
(c) Except as otherwise provided herein, upon receipt of a Rights Certificate
representing exercisable Rights with the form of election to purchase duly
executed, accompanied by payment by certified check, cashier's check, bank
draft or money order payable to the Corporation or the Rights Agent of the
Exercise Price for the shares to be purchased and an amount equal to any
applicable Transfer Tax required to be paid by the holder of the Rights
Certificate in accordance with Section 9(e) hereof, the Rights Agent shall
thereupon promptly (i) requisition from any registrar or transfer agent (as
may be appropriate) of the Preferred Stock of the Corporation one or more
certificates representing the number of shares of Preferred Stock to be so
purchased, and the Corporation hereby authorizes and directs such registrar
or transfer agent (as may be appropriate) to comply with all such requests,
(ii) as provided in Section 14(b), at the election of the Corporation,
cause depositary receipts to be issued in lieu of fractional shares of
Preferred Stock, (iii) if the election provided for in the immediately
preceding clause (ii) has not been made, requisition from the Corporation
the amount of cash to be paid in lieu of the issuance of fractional shares
in accordance with Section 14(b) hereof, (iv) after receipt of such
Preferred Stock certificates and, if applicable, 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 (v) when appropriate, after receipt, promptly
deliver such cash to or upon the order of the registered holder of such
Rights Certificate; provided, however, that in the case of a purchase of
securities, other than Preferred Stock, pursuant to Section 13 hereof, the
Rights Agent shall promptly take the appropriate actions corresponding in
such case to that referred to in the foregoing clauses (i) through (v) of
this Section 7(c). Notwithstanding the foregoing provisions of this Section
7(c), the Corporation may suspend the issuance of shares of Preferred Stock
upon exercise of a Right for a reasonable period, not in excess of 120
days, during which the Corporation seeks to register under the Securities
Act of 1933, as amended (the "Act"), and any applicable securities law of
any other jurisdiction, the shares of Preferred Stock to be issued pursuant
to the Rights; provided, however, that nothing contained in this Section
7(c) shall relieve the Corporation of its obligations under Section 9(c)
hereof.
(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 to the registered holder of such Rights Certificate or his
assignee, subject to the provisions of Section 14(b) hereof.
(e) Notwithstanding any provision of this Rights Agreement to the contrary,
from and after the time (the "Invalidation Time") when any Person first
becomes an Acquiring Person, any Rights that are Beneficially Owned by (x)
such Acquiring Person (or any Associate or Affiliate of such Acquiring
Person), (y) a transferee of such Acquiring Person (or any such Associate
or Affiliate) who becomes a transferee after the Invalidation Time or (z) a
transferee of such Acquiring Person (or any such Associate or Affiliate)
who becomes a transferee prior to or concurrently with the Invalidation
Time pursuant to either (I) a transfer from the Acquiring Person to holders
of its equity securities or to any Person with whom it has any continuing
agreement, arrangement or understanding regarding the transferred Rights or
(II) a transfer which the Board of Directors has determined is part of a
plan, arrangement or understanding which has the purpose or effect of
avoiding the provisions of this Section 7(e), and subsequent transferees of
the Persons referred to in either clause (y) or (z) above, shall be void
without any further action and any holder of such Rights shall thereafter
have no rights whatsoever with respect to such Rights under any provision
of this Rights Agreement. The Corporation shall use all reasonable efforts
to ensure that the provisions of this Section 7(e) are complied with, but
shall have no liability to any holder of a Rights Certificate or any other
Person as a result of the Corporation's failure to make any determination
with respect to an Acquiring Person or its Affiliates, Associates or
transferees hereunder. No Rights Certificate shall be issued pursuant to
Section 3 hereof that represents Rights Beneficially Owned by an Acquiring
Person or any other Person whose Rights would be void pursuant to the
provisions of this Section 7(e) or any Associate, Affiliate or nominee
thereof; no Rights Certificate shall be issued at any time upon the
transfer of any Rights to an Acquiring Person or any other Person whose
Rights would be void pursuant to the provisions of this Section 7(e) or any
Associate, Affiliate or nominee thereof; and any Rights Certificate
delivered to the Rights Agent for transfer to an Acquiring Person whose
Rights would be void pursuant to the provisions of this Section 7(e) shall
be canceled.
(f) Notwithstanding anything in this Agreement to the contrary, neither the
Rights Agent nor the Corporation 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 following 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 and such other information as
the Corporation 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
Corporation or to any of its agents, be delivered to the Rights Agent for
cancellation or in canceled form, or, if surrendered to the Rights Agent,
shall be canceled by it, and no Rights Certificates shall be issued in lieu
thereof except as expressly permitted by any of the provisions of this
Rights Agreement. The Corporation shall deliver to the Rights Agent for
cancellation and retirement, and the Rights Agent shall cancel and retire,
any Rights Certificate purchased or acquired by the Corporation otherwise
than upon the exercise thereof. The Rights Agent shall deliver all canceled
Rights Certificates to the Corporation, or shall, at the written request of
the Corporation, destroy such canceled Rights Certificates, and in such
case shall deliver a certificate of destruction thereof to the Corporation.
Section 9. Reservation and Availability of Shares of Preferred Stock.
(a) The Corporation covenants and agrees that it will cause to be reserved and
kept available out of its authorized and unissued shares of Preferred Stock
or out of authorized and issued shares of Preferred Stock held in its
treasury, such number of shares of Preferred Stock as will from time to
time be sufficient to permit the exercise in full of all outstanding
Rights. The Corporation shall take such action as may be required for it to
comply with the foregoing sentence of this Section 9(a).
(b) The Corporation shall use its best efforts to cause, from and after such
time as the Rights become exercisable, all shares of Preferred Stock issued
or reserved for issuance in accordance with this Rights Agreement to be
listed, upon official notice of issuance, upon the principal national
securities exchange, if any, upon which the Common Stock is listed or, if
the principal market for the Common Stock is not on any national securities
exchange, to be eligible for quotation on NASDAQ or any successor thereto
or other comparable quotation system.
(c) The Corporation covenants and agrees that it will take all such actions as
may be necessary to insure that all shares of Preferred Stock delivered
upon exercise of Rights shall, at the time of delivery of the certificates,
for such shares (subject to payment of the Exercise Price in respect
thereof), be duly and validly authorized and issued and fully paid and
nonassessable shares.
(d) The Corporation shall use its best efforts to (i) file, as soon as
practicable following the occurrence of the event described in Section
11(a)(ii), or as soon as is required by law following the Distribution
Date, as the case may be, a registration statement under the Act, with
respect to the shares of Preferred Stock 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 Preferred Stock,
or (B) the Expiration Date. The Corporation may temporarily suspend, for a
period of time not to exceed 120 days, the issuance of shares of Preferred
Stock upon exercise of a Right in order to prepare and file a registration
statement under the Act and permit it to become effective. The Corporation
will also take such action as may be appropriate under, or to ensure
compliance with, the securities or "blue sky" laws of the various states in
connection with the exercisability of the Rights. Notwithstanding any
provision of this Agreement to the contrary, the Rights shall not be
exercisable in any jurisdiction unless the requisite qualification in such
jurisdiction shall have been obtained and until a registration statement
under the Act (if required) shall have been declared effective.
(e) The Corporation covenants and agrees that it will pay when due and payable
any and all federal and state Transfer Taxes which may be payable in
respect of the issuance or delivery of the Rights Certificates or of any
shares of Preferred Stock issued or delivered upon the exercise of Rights.
The Corporation shall not, however, be required to pay any Transfer Tax
which may be payable in respect of any transfer or delivery of a Rights
Certificate to a Person other than, or the issuance or delivery of
certificates for Preferred Stock upon exercise of Rights in a name other
than that of, the registered holder of the Rights Certificate, and the
Corporation shall not be required to or issue or deliver a Rights
Certificate or certificate for Preferred Stock to a Person other than such
registered holder until any such Transfer Tax shall have been paid (any
such Transfer Tax being payable by the holder of such Rights Certificate at
the time of surrender) or until it has been established to the
Corporation's satisfaction that no such Transfer Tax is due.
Section 10. Preferred Stock Record Date.
Each Person in whose name any certificate for shares of Preferred
Stock is issued upon the exercise of Rights shall for all purposes be
deemed to have become the holder of record of the Preferred Stock
represented thereby on, and such certificate shall be dated as of, the date
upon which the Rights Certificate evidencing such Rights was duly
surrendered and payment of the Exercise Price (and any applicable Transfer
Taxes) was made; provided, however, that, if the date of such surrender and
payment is a date upon which the Preferred Stock transfer books of the
Corporation are closed, such Person shall be deemed to have become the
record holder of such shares on, and such certificate shall be dated as of,
the next succeeding Business Day on which the Preferred Stock transfer
books of the Corporation are open. Prior to the exercise of the Rights
evidenced thereby, the holder of a Rights Certificate, as such, shall not
be entitled to any rights of a stockholder of the Corporation 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 Corporation, except as provided
herein.
Section 11. Adjustment of Exercise Price or Number of Shares.
The Exercise Price and the number of shares of Preferred Stock which
may be purchased upon exercise of a 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 Corporation shall at any time after the date of this
Rights Agreement (A) declare or pay any dividend on Common Stock
payable in shares of Common Stock, (B) subdivide or split the
outstanding shares of Common Stock into a greater number of shares or
(C) combine or consolidate the outstanding shares of Common Stock into
a smaller number of shares or effect a reverse split of the
outstanding shares of Common Stock, then and in each such event the
number of shares of Preferred Stock issuable upon the exercise of a
Right after the record date for such event (if one shall have been
established or, if not, after the date of such event) shall be the
number of shares of Preferred Stock issuable immediately prior to such
event multiplied by a fraction the numerator of which is the number of
Rights outstanding immediately prior to such event and the denominator
of which is the number of Rights outstanding immediately after such
event and the Exercise Price after such event shall be the Exercise
Price in effect immediately prior to such event multiplied by such
fraction. 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).
(ii) Subject to Section 27 of this Agreement, in the event that any Person
(other than an Exempt Person), alone or together with its Affiliates
and Associates, shall become an Acquiring Person, then, subject to the
last sentence of Section 23(a) and except as otherwise provided in
this Section 11, each holder of a Right, except as provided in Section
7(e) hereof, shall thereafter have the right to receive upon exercise
of such Right in accordance with the terms of this Rights Agreement
and payment of the Exercise Price, the greater of (1) the number of
one one-thousandths of a share of Preferred Stock for which such Right
was exercisable immediately prior to the first occurrence of the event
described in this Section 11(a)(ii) or (2) such number of one
one-thousandths of a share of Preferred Stock, based on the per share
Fair Market Value of the Preferred Stock (determined pursuant to
Section 11(b) hereof) on the date of such first occurrence, having a
value equal to twice the Exercise Price; provided, however, that if
the transaction that would otherwise give rise to the foregoing
adjustment is also subject to the provisions of Section 13 hereof,
then only the provisions of Section 13 hereof shall apply and no
adjustment shall be made pursuant to this Section 11(a)(ii).
(iii)In the event that the Corporation does not have available sufficient
authorized but unissued Preferred Stock to permit the adjustments
required pursuant to the foregoing subparagraph (i) or the exercise in
full of the Rights in accordance with the foregoing subparagraph (ii),
the Corporation shall take all such actions as may be necessary to
authorize and reserve for issuance such number of additional shares of
Preferred Stock as may from time to time be required to be issued upon
the exercise in full of all Rights from time to time outstanding and,
if necessary, shall use its best efforts to obtain stockholder
approval thereof. In lieu of issuing shares of Preferred Stock in
accordance with the foregoing subparagraphs (i) and (ii), the
Corporation may, if the Board of Directors determines that such action
is necessary or appropriate and not contrary to the interests of
holders of Rights, elect to issue or pay, upon the exercise of the
Rights, (A) cash, (B) other equity securities of the Corporation, (C)
debt securities of the Corporation, (D) other assets or (E) any
combination of the foregoing, in each case, having an aggregate Fair
Market Value equal to the Fair Market Value of the shares of Preferred
Stock which otherwise would have been issuable pursuant to Section
11(a)(ii), which Fair Market Value shall be determined by an
investment banking firm selected by the Board of Directors. For
purposes of the preceding sentence, the Fair Market Value of the
Preferred Stock shall be as determined pursuant to Section 11(b).
Subject to Section 23 hereof, any such election by the Board of
Directors of the Corporation must be made and publicly announced
within thirty (30) days after the date on which the event described in
Section 11(a)(ii) occurs.
(b) For the purpose of this Rights Agreement, the "Fair Market Value" of any
share of Preferred Stock, Common Stock or any other stock or any Right or
other security or any other property on any date shall be determined as
provided in this Section 11(b). In the case of a publicly-traded stock or
other security, the Fair Market Value on any date shall be deemed to be the
average of the daily closing prices per share of such stock or per unit of
such other security for the 30 consecutive Trading Days (as such term is
hereinafter defined) immediately prior to such date; provided, however,
that in the event that the Fair Market Value per share of any share of
Common Stock is determined during a period which includes any date that is
within 30 Trading Days after (i) the ex-dividend date for a dividend or
distribution on such stock payable in shares of Common Stock or securities
convertible into shares of Common Stock, or (ii) the effective date of any
subdivision, split, combination, consolidation, reverse stock split or
reclassification of such stock, then, and in each such case, the Fair
Market Value shall be appropriately adjusted by the Board of Directors of
the Corporation to take into account ex-dividend or post-effective date
trading. The closing price for any day shall be the last sale price,
regular way, or, in case no such sale takes place on such day, the average
of the closing bid and asked prices, regular way (in either case, as
reported in the applicable transaction reporting system with respect to
securities listed or admitted to trading on the New York Stock Exchange),
or, if the securities are not listed or admitted to trading on the New York
Stock Exchange, as reported in the applicable transaction reporting system
with respect to securities listed on the principal national securities
exchange on which such security is listed or admitted to trading; or, if
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 no bids for such security are 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 such
security selected by the Board of Directors of the Corporation. The term
"Trading Day" shall mean a day on which the principal national securities
exchange on which such security is listed or admitted to trading is open
for the transaction of business or, if such security is not listed or
admitted to trading on any national securities exchange, a Business Day. If
a security is not publicly held or not so listed or traded, "Fair Market
Value" shall mean the fair value per share of stock or per other unit of
such other security, as determined by an independent investment banking
firm experienced in the valuation of securities selected in good faith by
the Board of Directors of the Corporation, or, if no such investment
banking firm is, in the good faith judgment of the Board of Directors,
available to make such determination, in good faith by the Board of
Directors of the Corporation; provided, however, that for purposes of
making the adjustment provided for by Section 11(a)(ii) hereof, the Fair
Market Value of a share of Preferred Stock shall not be less than 100% of
the product of the Fair Market Value of a share of Common Stock multiplied
by the higher of the then Dividend Multiple or Vote Multiple applicable to
the Preferred Stock (as defined in the provisions of the Certificate of
Designations relating to the Preferred Stock) and shall not exceed 105% of
the product of the then Fair Market Value of a share of Common Stock
multiplied by the higher of the then Dividend Multiple or Vote Multiple
applicable to the Preferred Stock. In the case of property other than
securities, the "Fair Market Value" thereof shall be determined in good
faith by the Board of Directors of the Corporation based upon such
appraisals or valuation reports of such independent experts as the Board of
Directors of the Corporation shall in good faith determine to be
appropriate in accordance with good business practices and the interests of
the holders of Rights. Any such determination of Fair Market Value shall be
described in a statement filed with the Rights Agent and shall be binding
upon the Rights Agent.
(c) All calculations under this Section 11 shall be made to the nearest cent or
to the nearest one one-thousandth of a share, as the case may be.
(d) Irrespective of any adjustment or change in the Exercise Price or the
number of shares of Preferred Stock issuable upon the exercise of the
Rights, the Rights Certificates theretofore and thereafter issued may
continue to express the Exercise Price and the number of shares to be
issued upon exercise of the Rights as in the initial Rights Certificates
issued hereunder but, nevertheless, shall represent the Rights as so
adjusted.
(e) Before taking any action that would cause an adjustment reducing the
purchase price per whole share of Preferred Stock upon exercise of the
Rights below the then par value, if any, of the shares of Preferred Stock,
the Corporation shall use its best efforts to take any corporate action
which may, in the opinion of its counsel, be necessary in order that the
Corporation may validly and legally issue fully paid and non-assessable
shares of such Preferred Stock at such adjusted purchase price per share.
(f) Anything in this Section 11 to the contrary notwithstanding, in the event
of any reclassification of stock of the Corporation or any
recapitalization, reorganization or partial liquidation of the Corporation
or similar transaction, the Corporation shall be entitled to make such
further adjustments in the number of shares of Preferred Stock which may be
acquired upon exercise of the Rights, and such adjustments in the Exercise
Price therefor, in addition to those adjustments expressly required by the
other paragraphs of this Section 11, as the Board of Directors of the
Corporation shall determine to be necessary or appropriate in order for the
holders of the Rights in such event to be treated equitably and in
accordance with the purpose and intent of this Rights Agreement or in order
that any such event shall not, but for such adjustment, in the opinion of
counsel to the Corporation, result in the stockholders of the Corporation
being subject to any United States federal income tax liability by reason
thereof.
(g) In the event the Corporation shall at any time after the Record Date make
any distribution on the shares of Common Stock of the Corporation, whether
by way of a dividend or a reclassification of stock, a recapitalization,
reorganization or partial liquidation of the Corporation or otherwise, in
cash or any debt security, debt instrument, real or personal property or
any other property (other than any shares of Common Stock or other capital
stock of the Corporation and other than any right or warrant to acquire any
such shares, including any debt security convertible into or exchangeable
for any such share, at less than the Fair Market Value of such shares) and
the amount of such cash dividend or the Fair Market Value of such debt
security, debt instrument or property exceeds 150% of the aggregate amount
of the cash dividends declared or paid on the Common Stock of the
Corporation in the 15-month period immediately preceding such distribution,
then and in each such event, unless such distribution is part of or is made
in connection with a transaction to which Section 11(a)(ii) or Section 13
hereof applies, the Exercise Price shall be reduced by an amount equal to
the cash or the Fair Market Value of such distribution, as the case may be,
per share of Common Stock of the Corporation. For purposes hereof, the Fair
Market Value of any property distributed to the holders of shares of Common
Stock of the Corporation shall be the Fair Market Value of such property as
determined by an independent investment banking firm experienced in the
valuation of securities or the other property so distributed, as the case
may be, selected in good faith by the Board of Directors of the
Corporation, or, if no such investment banking firm is in the good faith
judgment of the Board of Directors available to make such determination,
in good faith by the Board of Directors of the Corporation, whose
determination shall be final and binding on the Corporation, the Rights
Agent and the holders of Rights.
Section 12. Certification of Adjusted Exercise Price or Number of Shares.
Whenever an adjustment is made as provided in Section 11, 13 or 23(c),
the Corporation shall (a) promptly prepare a certificate setting forth such
adjustment, and a brief statement of the facts giving rise to such
adjustment, (b) promptly file with the Rights Agent and with each transfer
agent for the Preferred Stock a copy of such certificate and (c) mail a
brief summary thereof to each holder of a Rights Certificate in accordance
with Section 25. Notwithstanding the foregoing sentence, the failure of the
Corporation to make such certification or give such notice shall not affect
the validity of or the force or effect of the requirement for such
adjustment. Any adjustment to be made pursuant to Section 11, 13 or 23(c)
of this Rights Agreement shall be effective as of the date of the event
giving rise to such adjustment. The Rights Agent shall be fully protected
in relying on any such certificate and on any adjustment therein contained
and shall not be deemed to have knowledge of any adjustment unless and
until it shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning
Power.
(a) In the event that, at any time after the time that any Person becomes an
Acquiring Person, (x) the Corporation shall, directly or indirectly,
consolidate with, or merge with and into, any other Person or Persons
(other than an Exempt Person or Persons) and the Corporation shall not be
the surviving or continuing corporation of such consolidation or merger, or
(y) any Person or Persons (other than an Exempt Person) shall, directly or
indirectly, consolidate with, or merge with and into, the Corporation, and
the Corporation 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
(other than an Exempt Person) or of the Corporation or cash or any other
property, or (z) the Corporation or one or more of its Subsidiaries shall,
directly or indirectly, sell or otherwise transfer to any other Person or
any Affiliate or Associate of such Person, in one or more transactions, or
the Corporation or one or more of its Subsidiaries shall sell or otherwise
transfer to any Persons in one or a series of related transactions, assets
or earning power aggregating more than 50% of the assets or earning power
of the Corporation and its Subsidiaries (taken as a whole), then, on the
first occurrence of any such event, proper provision shall be made so that
(i) each holder of record of a Right, except as provided in Section 7(e)
hereof, shall thereafter have the right to receive, upon the exercise
thereof and payment of the Exercise Price in accordance with the terms of
this Rights Agreement, such number of shares of validly issued, fully paid,
non-assessable and freely tradable Common Stock of the Principal Party (as
defined herein), not subject to any liens, encumbrances, rights of first
refusal or other adverse claims, as shall, based on the Fair Market Value
of the Common Stock of the Principal Party on the date of the consummation
of such consolidation, merger, sale or transfer, equal to twice the
Exercise Price; (ii) such Principal Party shall thereafter be liable for,
and shall assume, by virtue of such consolidation, merger, sale or
transfer, all the obligations and duties of the Corporation pursuant to
this Rights Agreement; (iii) the term "Corporation" for all purposes of
this Rights Agreement shall thereafter be deemed to refer to such Principal
Party; (iv) such Principal Party shall take such steps (including, but not
limited to, the reservation of a sufficient number of shares of its Common
Stock in accordance with the provisions of Section 9 hereof applicable to
the reservation of Preferred Stock) in connection with such consummation as
may be necessary to insure 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;
provided, however, that, upon the subsequent occurrence of any merger,
consolidation, sale of all or substantially all of the assets,
recapitalization, reclassification of shares, reorganization or other
extraordinary transaction in respect of such Principal Party, each holder
of a Right shall thereupon be entitled to receive, upon exercise of a Right
and payment of the Exercise Price, such cash, shares, rights, warrants and
other property which such holder would have been entitled to receive had
it, at the time of such transaction, owned the shares of Common Stock of
the Principal Party purchasable upon the exercise of a Right, and such
Principal Party shall take such steps (including, but not limited to,
reservation of shares of stock) as may be necessary to permit the
subsequent exercise of the Rights in accordance with the terms hereof for
such cash, shares, rights, warrants and other property; and (v) the
provisions of Section 11(a)(ii) hereof shall be of no effect following the
occurrence of any event described in clause (x), (y) or (z) above of this
Section 13(a).
(b) "Principal Party" shall mean:
(i) in the case of any transaction described in (x) or (y) of the first
sentence of Section 13(a) hereof: (A) the Person that is the issuer of
the securities into which shares of Common Stock of the Corporation
are changed or otherwise exchanged or converted in such merger or
consolidation, or, if there is more than one such issuer, the issuer
of the Common Stock of which has the greatest market value or (B) if
no securities are so issued, (x) the Person that is the other party to
the merger or consolidation and that survives such merger or
consolidation, or, if there is more than one such Person, the Person
the Common Stock of which has the greatest market value or (y) if the
Person that is the other party to the merger or consolidation does not
survive the merger or consolidation, the Person that does survive the
merger or consolidation (including the Corporation if it survives);
and
(ii) in the case of any transaction described in (z) of the first sentence
in Section 13(a), the Person that is the party receiving the greatest
portion of the assets or earning power transferred pursuant to such
transaction or transactions, or, if each Person that is a party to
such transaction or transactions receives the same portion of the
assets or earning power so transferred or if the Person receiving the
greatest portion of the assets or earning power cannot be determined,
whichever of such Persons as is the issuer of Common Stock having the
greatest market value of shares outstanding; provided, however, that
in any such case, if the Common Stock of such Person is not at such
time and has not been continuously over the preceding 12-month period
registered under Section 12 of the Exchange Act, and such Person is a
direct or indirect Subsidiary of another Person the Common Stock of
which is and has been so registered, the term "Principal Party" shall
refer to such other Person, or if such Person is a Subsidiary,
directly or indirectly, of more than one Person, the Common Stocks of
all of which are and have been so registered, the term "Principal
Party" shall refer to whichever of such Persons is the issuer of the
Common Stock having the greatest market value of shares outstanding.
(c) The Corporation shall not consummate any consolidation, merger or sale or
transfer of assets or earning power referred to in Section 13(a) unless the
Principal Party shall have a sufficient number of authorized shares of its
Common Stock that have not been issued or reserved for issuance to permit
exercise in full of all Rights in accordance with this Section 13 and
unless prior thereto the Corporation and the Principal Party involved
therein shall have executed and delivered to the Rights Agent an agreement
confirming that the Principal Party shall, upon consummation of such
consolidation, merger or sale or transfer of assets or earning power,
assume this Rights Agreement in accordance with Section 13(a) hereof and
that all rights of first refusal or preemptive rights in respect of the
issuance of shares of Common Stock of the Principal Party upon exercise of
outstanding Rights have been waived and that such transaction shall not
result in a default by the Principal Party under this Rights Agreement, and
further providing that, as soon as practicable after the date of any
consolidation, merger or sale or transfer of assets or earning power
referred to in Section 13(a) hereof, 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, use its best efforts to cause such
registration statement to become effective as soon as practicable
after such filing and use its best efforts to cause such registration
statement to remain effective (with a prospectus at all times meeting
the requirements of the Act) until the date of expiration of the
Rights, and similarly comply with applicable state securities laws;
(ii) use its best efforts to list (or continue the listing of) the Rights
and the securities purchasable upon exercise of the Rights on a
national securities exchange or to meet the eligibility requirements
for quotation on NASDAQ; and
(iii)deliver to holders of the Rights historical financial statements for
the Principal Party which comply in all respects with the requirements
for registration on Form 10 (or any successor form) under the Exchange
Act. In the event that any of the transactions described in Section
13(a) hereof shall occur at any time after the occurrence of a
transaction described in Section 11(a)(ii) hereof, the Rights which
have not theretofore been exercised shall, subject to the provisions
of Section 7(e) hereof, thereafter be exercisable in the manner
described in Section 13(a).
(d) In case the Principal Party which is to be a party to a transaction
referred to in this Section 13 has a provision in any of its authorized
securities or in its Certificate of Incorporation or By-Laws or other
instrument governing its corporate affairs, which provision would have the
effect of (i) causing such Principal Party to issue, in connection with, or
as a consequence of, the consummation of a transaction referred to in this
Section 13, shares of Common Stock of such Principal Party at less than the
then Fair Market Value per share (determined pursuant to Section 11(b)
hereof) or securities exercisable for, or convertible into, Common Stock of
such Principal Party at less than such then Fair Market Value (other than
to holders of Rights pursuant to this Section 13) or (ii) providing for any
special tax or similar payment in connection with the issuance to any
holder of a Right of Common Stock of such Principal Party pursuant to the
provisions of this Section 13, then, in such event, the Corporation shall
not consummate any such transaction unless prior thereto the Corporation
and such Principal Party shall have executed and delivered to the Rights
Agent a supplemental agreement providing that the provision in question of
such Principal Party shall have been canceled, waived or amended, or that
the authorized securities shall be redeemed, so that the applicable
provision will have no effect in connection with, or as a consequence of,
the consummation of the proposed transaction.
Section 14. Fractional Rights and Fractional Shares.
(a) The Corporation shall not be required to issue fractions of Rights or to
distribute Rights Certificates which evidence fractional Rights (i.e.,
Rights to acquire less than one one-thousandth of a share of Preferred
Stock), unless such fractional Rights result from a transaction referred to
in Section 11(a)(i) hereof. If the Corporation shall determine not to issue
such fractional Rights, then, in lieu of such fractional Rights, there
shall be paid to the holders of record 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 Fair Market Value of a
whole Right.
(b) The Corporation shall not be required to issue fractions of shares of
Preferred Stock (other than fractions which are integral multiples of
one-thousandth of a share) upon exercise of the Rights or to distribute
certificates which evidence fractional shares (other than fractions which
are integral multiples of one-thousandth of a share). In lieu of issuing
fractions of shares of Preferred Stock, the Corporation may, at its
election, issue depositary receipts evidencing fractions of shares pursuant
to an appropriate agreement between the Corporation and a depositary
selected by it, provided that such agreement shall provide that the holders
of such depositary receipts shall have all of the rights, privileges and
preferences to which they would be entitled as owners of the Preferred
Stock. With respect to fractional shares that are not integral multiples of
one-thousandth of a share, if the Corporation does not issue such
fractional shares or depositary receipts in lieu thereof, there shall be
paid to the holders of record of Rights Certificates at the time such
Rights are exercised as herein provided an amount in cash equal to the same
fraction of the Fair Market Value of a share of Preferred Stock.
(c) The holder of a Right by the acceptance of a Right expressly waives his
right to receive any fractional Right or any fractional shares of Preferred
Stock (other than fractions which are integral multiples of one
one-thousandth of a share) upon exercise of a Right.
Section 15. Rights of Action.
All rights of action in respect of this Rights Agreement, except the
rights of action given to the Rights Agent in Section 18 hereof, are vested
in the respective registered holders of the Rights Certificates (and, prior
to the Distribution Date, the holders of record of the Common Stock); and
any holder of record 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 own behalf and for his
own benefit, enforce, and may institute and maintain any suit, action or
proceeding against the Corporation to enforce, or otherwise act in respect
of, his right to exercise the Rights evidenced by such Rights Certificate
in the manner provided in such Rights Certificate and, in this Rights
Agreement. Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the holders of
Rights would not have an adequate remedy at law for any breach of this
Rights Agreement and will be entitled to specific performance of the
obligations under, and injunctive relief against actual or threatened
violations of, the obligations of any Person subject to this Rights
Agreement.
Section 16. Agreement of Right Holders.
Each holder of a Right, by accepting the same, consents and agrees
with the Corporation and the Rights Agent and with every other holder of a
Right that:
(a) Prior to the Distribution Date, the Rights shall be evidenced by the
Book-Entries representing, or the certificates for, Common Stock registered
in the name of the holders of Common Stock (together, as applicable, with
the Summary of Rights), which Book-Entries representing, or the
certificates for, Common Stock shall also constitute certificates for
Rights, and not by separate Rights Certificates, and each Right shall be
transferable only simultaneously and together with the transfer of shares
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 office of
the Rights Agent designated for such purpose, duly endorsed or accompanied
by a proper instrument of transfer;
(c) The Corporation and the Rights Agent may deem and treat the person in whose
name the Rights Certificate (or, prior to the Distribution Date, the
associated Book-Entry representing, or certificate for, Common Stock) 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 Corporation or the Rights Agent) for all purposes
whatsoever, and neither the Corporation nor the Rights Agent shall be
affected by any notice to the contrary.
(d) Notwithstanding anything in this Agreement to the contrary, neither the
Corporation nor the Rights Agent shall have any liability to any holder of
a Right or a beneficial interest in 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 Corporation must use its best efforts to
have any such order, decree or ruling lifted or otherwise overturned as
soon as possible; and
(e) Rights Beneficially Owned by certain persons will under certain
circumstances set forth in this Agreement become null and void pursuant to
Section 7(e) hereof; and
(f) This Agreement may be supplemented or amended from time to time pursuant to
Section 26 hereof.
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
Preferred Stock or any other securities 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 Corporation or any right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting
thereof (except as provided in Section 7(f) hereof), or to give or withhold
consent to any corporate action (except as provided in Section 7(f)
hereof), 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 Corporation agrees to pay to the Rights Agent reasonable compensation
for all services rendered by it hereunder and, from time to time, on demand
of the Rights Agent, its reasonable expenses and counsel fees and other
disbursements incurred in the administration and execution of this Rights
Agreement and the exercise and performance of its duties hereunder. The
Corporation 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 failed to be done by the Rights Agent in
connection with the acceptance and administration of this Rights Agreement,
including the costs and expenses of defending against any claim of
liability relating to the Rights or this Rights Agreement.
(b) The Rights Agent shall be protected against, and shall incur no liability
for or in respect of, any action taken, suffered or omitted by it in
connection with its administration of this Rights Agreement in reliance
upon any Rights Certificate or certificate for Preferred Stock or for other
securities of the Corporation, 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 of, or Change in Name of, the
Rights Agent.
(a) Any corporation into which the Rights Agent or any successor Rights Agent
may be merged or with which it may be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any corporation succeeding to
the corporate trust or stock transfer business of the Rights Agent or any
successor Rights Agent, shall be the successor to the Rights Agent under
this Rights Agreement without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided that such
corporation would be eligible for appointment as a successor Rights Agent
under the provisions of Section 21 hereof. In case at the time such
successor Rights Agent shall succeed to the agency created by this Rights
Agreement any of the Rights Certificates shall have been countersigned but
not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such 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 Rights Agent 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 Rights Agreement.
(b) In case at any time the name of the Rights Agent shall be changed and at
such time any of the Right Certificates shall have been countersigned but
not delivered, the Rights Agent may adopt the countersignature under its
prior name and deliver Rights Certificates so countersigned; 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; in all such cases such Rights
Certificates shall have the full force provided in the Rights Certificates
and in this Rights Agreement.
Section 20. Duties of Rights Agent.
The Rights Agent undertakes the duties and obligations imposed by this
Rights Agreement upon the following terms and conditions, by all of which
the Corporation 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 Corporation), 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 Rights Agreement the
Rights Agent shall deem it necessary or desirable that any fact or matter
be proved or established by the Corporation 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 or any Vice President and by the Treasurer or the
Secretary of the Corporation and delivered to the Rights Agent. Any 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 Rights
Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder to the Corporation and any other
Person only for its own negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any of the
statements of fact or recitals contained in this Rights Agreement or in the
Rights Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be
deemed to have been made by the Corporation only.
(e) The Rights Agent shall not be under any responsibility in respect of the
validity of this Rights Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the
validity or execution of any Rights Certificate (except its
countersignature thereof); nor shall it be responsible for any breach by
the Corporation of any covenant or condition contained in this Rights
Agreement or in any Rights Certificate; nor shall it be responsible for any
adjustment required under the provisions of Section 11 or 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 receipt of a certificate describing 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 Preferred Stock to be issued pursuant to this Rights Agreement or
any Rights Certificate or as to whether any shares of Preferred Stock will,
when issued, be validly authorized and issued, fully paid and
nonassessable.
(f) The Corporation 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 the Rights Agreement.
(g) The Rights Agent is hereby authorized and directed to accept instructions
with respect to the performance of its duties hereunder from the Chairman
of the Board, the President or any Vice President or the Secretary or the
Treasurer of the Corporation, 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 shareholder, director, officer or employee of the
Rights Agent may buy, sell or deal in any of the Rights or other securities
of the Corporation or become financially interested in any transaction in
which the Corporation may be interested, or contract with or lend money to
the Corporation or otherwise act as fully and freely as though it were not
the Rights Agent under this Rights Agreement. Nothing herein shall preclude
the Rights Agent from acting in any other capacity for the Corporation 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 Corporation resulting
from any such act, default, neglect or misconduct, provided reasonable care
was exercised in the selection and continued employment thereof.
Section 21. Change of Rights Agent.
The Rights Agent or any successor Rights Agent may resign and be
discharged from its duties under this Rights Agreement upon 30 days notice
in writing mailed to the Corporation and to each transfer agent of the
Common Stock and the Preferred Stock by registered or certified mail. The
Corporation may remove the Rights Agent or any successor Rights Agent (with
or without cause) upon 30 days notice in writing, mailed to the Rights
Agent or successor Rights Agent, as the case may be, and to each transfer
agent of the Common Stock and the Preferred Stock by registered or
certified mail. If the Rights Agent shall resign or be removed or shall
otherwise become incapable of acting, the Corporation shall appoint a
successor to the Rights Agent. Notwithstanding the foregoing provisions of
this Section 21, in no event shall the resignation or removal of a Rights
Agent be effective until a successor Rights Agent shall have been appointed
and have accepted such appointment. If the Corporation shall fail to make
such appointment within a period of 30 days after 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 Corporation), then the incumbent Rights Agent or the
holder of record 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 Corporation or by such a
court, shall be (a) a corporation organized and doing business under the
laws of the United States or of any state thereof, in good standing, which
is authorized under such laws to exercise corporate trust or stock transfer
powers and is subject to supervision or examination in the conduct of its
corporate trust or stock transfer business by federal or state authorities
and which has at the time of its appointment as Rights Agent a combined
capital and surplus of at least $50,000,000 or (b) an Affiliate controlled
by a corporation described in clause (a) of this sentence. After
appointment, the successor Rights Agent shall be vested with the same
powers, rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed, but the predecessor
Rights Agent shall deliver and transfer to the successor Rights Agent any
property at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Not
later than the effective date of any such appointment, the Corporation
shall file notice thereof in writing with the predecessor Rights Agent and
each transfer agent of the Common Stock and 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. Notwithstanding the foregoing
provisions, in the event of resignation, removal or incapacity of the
Rights Agent, the Corporation shall have the authority to act as the Rights
Agent until a successor Rights Agent shall have assumed the duties of the
Rights Agent hereunder.
Section 22. Issuance of New Rights Certificates.
Notwithstanding any of the provisions of this Rights Agreement or of
the Rights to the contrary, the Corporation 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 Exercise
Price per share and the number or kind or class of shares of stock or other
securities or property purchasable under the Rights Certificates made in
accordance with the provisions of this Rights Agreement.
Section 23. Redemption.
(a) The Corporation may, at its option, but only by the vote of a majority of
the Board of Directors, redeem all but not less than all of the then
outstanding Rights, at any time prior to the Close of Business on the
earlier of (i) the tenth day following the Stock Acquisition Date (subject
to extension by the Corporation as provided in Section 26 hereof) or
(ii) the Expiration Date, at a redemption price of $0.005 per Right,
subject to adjustments as provided in subsection (c) below (the "Redemption
Price"). Notwithstanding anything contained in this Agreement to the
contrary, the Rights shall not be exercisable pursuant to Section 11(a)(ii)
prior to the expiration of the Corporation's right of redemption hereunder
(b) Without any further action and without any notice, the right to exercise
the Rights will terminate effective at the time so designated by action of
the Board of Directors ordering the redemption of the Rights and the only
right thereafter of the holders of Rights shall be to receive the
Redemption Price. Within 10 days after the effective time of the action of
the Board of Directors ordering the redemption of the Rights, the
Corporation shall give notice of such redemption to the holders of the then
outstanding Rights by mailing such notice to all such holders at their last
addresses as they appear upon the registry books of the Rights Agent or,
prior to the Distribution Date, on the registry books of the transfer agent
for the Common Stock. Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives the
notice. Each notice of redemption will state the method by which the
payment of the Redemption Price will be made. At the option of the Board of
Directors, the Redemption Price may be paid in cash to each Rights holder
or by the issuance of shares (and, at the Corporation's election pursuant
to Section 14(b) hereof, cash or depositary receipts in lieu of fractions
of shares other than fractions which are integral multiples of one
one-thousandth (1/1,000) of a share) of Preferred Stock or Common Stock
having a Fair Market Value equal to such cash payment.
(c) In the event the Corporation shall at any time after the date of this
Rights Agreement (A) pay any dividend on Common Stock in shares of Common
Stock, (B) subdivide or split the outstanding shares of Common Stock into a
greater number of shares or (C) combine or consolidate the outstanding
shares of Common Stock into a smaller number of shares or effect a reverse
split of the outstanding shares of Common Stock, or (D) combine or
consolidate the outstanding shares of Common Stock into a smaller number of
shares of its capital stock in a reclassification of the Common Stock
(including any such reclassification in connection with a consolidation or
merger in which the Corporation is the continuing or surviving
corporation), then, and in each such event, the Redemption Price shall be
appropriately adjusted to reflect the foregoing.
Section 24. Notice of Proposed Actions.
(a) In case the Corporation, after the Distribution Date, shall propose (i) to
effect any of the transactions referred to in Section 11(a)(i) or 11(g) or
(ii) to offer to the holders of record of its Common Stock options,
warrants, or other rights to subscribe for or to purchase shares of Common
Stock (including any security convertible into or exchangeable for Common
Stock) or shares of stock of any class or any other securities, options,
warrants, convertible or exchangeable securities or other rights, or (iii)
to effect any reclassification of its Preferred Stock or Common Stock or
any recapitalization or reorganization of the Corporation, or (iv) to
effect any consolidation or merger with or into, or to effect any sale or
other transfer (or to permit one or more of its Subsidiaries to effect any
sale or other transfer), in one or more transactions, of more than 50% of
the assets or earning power of the Corporation and its Subsidiaries (taken
as a whole) to, any other Person or Persons, or (v) to effect the
liquidation, dissolution or winding up of the Corporation, then, in each
such case, the Corporation shall give to each holder of record of a Rights
Certificate, in accordance with Section 25, notice of such proposed action,
which shall specify the record date for the purposes of such transaction
referred to in Section 11(a)(i) or such dividend or distribution, or the
date on which such reclassification, recapitalization, reorganization,
consolidation, merger, sale or transfer of assets, liquidation,
dissolution, or winding up is to take place and the record date for
determining participation therein by the holders of record of Common Stock
or 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 10 days prior to the record date for determining holders of record
of the Preferred Stock for purposes of such action, and in the case of any
such other action, at least 10 days prior to the date of the taking of such
proposed action or the date of participation therein by the holders of
record of Common Stock or Preferred Stock, whichever shall be the earlier.
The failure to give notice required by this Section 24 or any defect
therein shall not affect the legality or validity of the action taken by
the Corporation or the vote upon any such action.
(b) In case any of the transactions referred to in Section 11(a)(i), 11(g) or
13 of this Rights Agreement are proposed, then, in any such case, the
Corporation shall give to each holder of Rights, in accordance with Section
25 hereof, notice of the proposal of such transaction at least 10 days
prior to consummating such transaction, which notice shall specify the
proposed event and the consequences of the event to holders of Rights under
Section 11(a)(i), 11(g) or 13 hereof, as the case may be, and, upon
consummating such transaction, shall similarly give notice thereof to each
holder of Rights.
Section 25. Notices.
Notices or demands authorized by this Rights Agreement to be given or
made by the Rights Agent or by the holder of record of any Rights
Certificate or Right to or on the Corporation 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:
MediaOne Group, Inc.
188 Inverness Drive West
Englewood, CO 80112
(303) 858-5800
Attention: General Counsel and Secretary
Subject to the provisions of Section 21, any notice or demand
authorized by this Rights Agreement to be given or made by the Corporation
or by the holder of record of any Rights Certificate or Right 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 Corporation) as follows:
[Rights Agent]
[Address]
Notices or demands authorized by this Rights Agreement to be given or
made by the Corporation or the Rights Agent to the holder of record of any
Rights Certificate or Right 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 Corporation.
Section 26. Supplements and Amendments.
For as long as the Rights are then redeemable and except as provided
in the last sentence of this Section 26, the Corporation may in its sole
and absolute discretion, and the Rights Agent shall if the Corporation so
directs, supplement or amend any provision of this Agreement without the
approval of any holders of the Rights. At any time when the Rights are not
then redeemable, the Corporation may, and the Rights Agent shall if the
Corporation so directs, supplement or amend this Rights Agreement without
the approval of any holders of Rights Certificates (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 or
(iii) to change or supplement the provisions hereunder in any manner which
the Corporation may deem necessary or desirable, provided that no such
supplement or amendment pursuant to this clause (iii) shall materially
adversely affect the interest of the holders of Rights Certificates. Upon
the delivery of a certificate from an appropriate officer of the
Corporation 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. Notwithstanding anything contained in
this Rights Agreement to the contrary, no supplement or amendment shall be
made which changes the Redemption Price or the Expiration Date and
supplements or amendments may be made after the time that any Person
becomes an Acquiring Person only if at the time of the action of the Board
of Directors approving such supplement or amendment there are then in
office not less than two Continuing Directors and such supplement or
amendment is approved by a majority of the Continuing Directors then in
office.
Section 27. Exchange.
(a) The Board of Directors of the Corporation may, at its option, at any time
after any Person becomes an Acquiring Person, exchange all or part of the
then outstanding and exercisable Rights (which shall not include Rights
that have become void pursuant to the provisions of Section 7(e) hereof)
for shares of Common Stock at an exchange ratio of one share per Right,
appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such exchange ratio
being hereinafter referred to as the "Exchange Ratio"). Notwithstanding the
foregoing, the Board of Directors shall not be empowered to effect such
exchange at any time after any Person (other than an Exempt Person),
together with all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 50% or more of the Voting Stock then outstanding.
(b) Immediately upon the action of the Board of Directors of the Corporation
ordering the exchange of any Rights pursuant to paragraph (a) of this
Section 27 and without any further action and without any notice, the right
to exercise such Rights shall terminate and the only right thereafter of a
holder of such Rights shall be to receive that number of shares of Common
Stock equal to the number of such Rights held by such holder multiplied by
the Exchange Ratio. The Corporation shall promptly give public notice of
any such exchange; provided, however, that the failure to give, or any
defect in, such notice shall not affect the validity of such exchange. The
Corporation promptly shall mail a notice of any such exchange to all of the
holders of such Rights at their last addresses as they appear upon the
registry books of the Rights Agent. Any notice which is mailed in the
manner herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of exchange will state the method by
which the exchange of the shares of Common Stock for Rights will be
effected and, in the event of any partial exchange, the number of Rights
which will be exchanged. Any partial exchange shall be effected pro rata
based on the number of Rights (other than Rights which have become void
pursuant to the provisions of Section 7(e) hereof) held by each holder of
Rights.
(c) In the event that there shall not be sufficient shares of Common Stock
issued but not outstanding or authorized but unissued to permit any
exchange of Rights as contemplated in accordance with this Section 27, the
Corporation shall take all such action as may be necessary to authorize
additional shares of Common Stock for issuance upon exchange of the Rights.
(d) The Corporation shall not be required to issue fractions of shares of
Common Stock or to distribute certificates which evidence fractional
shares. In lieu of such fractional shares, the Corporation shall pay to the
registered holders of the Rights Certificates with regard to which such
fractional shares of Common Stock would otherwise be issuable an amount in
cash equal to the same fraction of the current market value of a whole
share of Common Stock. For the purposes of this paragraph (d), the current
market value of a whole share of Common Stock shall be the closing price of
a share of Common Stock for the Trading Day immediately prior to the date
of exchange pursuant to this Section 27.
Section 28. Successors.
All of the covenants and provisions of this Rights Agreement by or for
the benefit of the Corporation or the Rights Agent shall bind and inure to
the benefit of their respective successors and assigns hereunder.
Section 29. Benefits of this Rights Agreement.
Nothing in this Rights Agreement shall be construed to give to any
Person or corporation other than the Corporation, the Rights Agent and the
registered holders of the Rights Certificates (and, prior to the
Distribution Date, the holders of Common Stock in their capacity as holders
of the Rights) any legal or equitable right, remedy or claim under this
Rights Agreement; but this Rights Agreement shall be for the sole and
exclusive benefit of the Corporation, the Rights Agent and the holders of
record of the Rights Certificates (and, prior to the Distribution Date, the
holders of Common Stock in their capacity as holders of the Rights).
Section 30. Delaware Contract.
This Rights Agreement 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 and
enforced in accordance with the laws of such state applicable to contracts
to be made and performed entirely within such state.
Section 31. Counterparts.
This Rights Agreement may be executed in any number of counterparts
and each of such counterparts shall for all purposes be deemed to be an
original, and all such counterparts shall together constitute but one and
the same instrument.
Section 32. Descriptive Headings.
Descriptive headings of the several Sections of this Rights Agreement
are inserted for convenience only and shall not control or affect the
meaning or construction of any of the provisions hereof.
Section 33. Severability.
If any term, provision, covenant or restriction of this Rights
Agreement is held by a court of competent jurisdiction or other authority
to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this rights agreement shall
remain in full force and effect and shall in no way be affected, impaired
or invalidated.
Section 34. Determinations And Actions By The Board Of Directors, Etc.
The Board of Directors of the Company shall have the exclusive power
and authority to administer this Agreement and to exercise all rights and
powers specifically granted to the Board of 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 of
Directors in good faith shall (x) be final, conclusive and binding on the
Company, the Rights Agent, the holders of the Rights and all other parties,
and (y) not subject the Board of Directors to any liability to the holders
of the Rights.
IN WITNESS WHEREOF, the parties hereto have caused this Rights Agreement to
be duly executed, all as of the day and year first above written.
MEDIAONE GROUP, INC.
Attest: _________________________ By: ___________________________________
(SEAL) Name:
Title:
[RIGHTS AGENT]
Attest: _________________________ By: ___________________________________
(SEAL) Name:
Title:
EXHIBIT A
TO RIGHTS AGREEMENT
UNDER CERTAIN CIRCUMSTANCES AS PROVIDED IN THE RIGHTS AGREEMENT (AS REFERRED TO
BELOW), RIGHTS ISSUED TO OR BENEFICIALLY OWNED BY ACQUIRING PERSONS OR THEIR
AFFILIATES OR ASSOCIATES (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR
ANY SUBSEQUENT HOLDER OF SUCH RIGHTS SHALL BE NULL AND VOID AND MAY NOT BE
TRANSFERRED TO ANY PERSON.
MEDIAONE GROUP, INC.
SUMMARY OF RIGHTS TO PURCHASE
SERIES F JUNIOR PARTICIPATING CUMULATIVE PREFERRED STOCK
On February 5, 1999, the Board of Directors of MEDIAONE GROUP, INC. (the
"Corporation") declared a dividend distribution of one preferred stock purchase
right for each outstanding share of Common Stock, par value $0.01 per share (the
"Common Stock"), of the Corporation held by stockholders of record on April 6,
1999 (the "Record Date"). Each Right entitles the registered holder to purchase
from the Corporation one one-thousandth (1/1,000) of a share of preferred stock
of the Corporation, designated as Series F Junior Participating Cumulative
Preferred Stock (the "Preferred Stock") at a price of $225 per one
one-thousandth (1/1,000) of a share (the "Exercise Price"). The description and
terms of the Rights are to be set forth in a Rights Agreement (the "Rights
Agreement") by and between the Corporation and its Rights Agent (the "Rights
Agent").
As discussed below, initially the Rights will not be exercisable,
certificates will not be sent to stockholders and the Rights will automatically
trade with the Common Stock.
The Rights, unless earlier redeemed by the Board of Directors, become
exercisable upon the close of business on the day (the "Distribution Date")
which is the earlier of (i) the tenth day following the first date (the "Stock
Acquisition Date") on which there is a public announcement that a person or
group of affiliated or associated persons, with certain exceptions set forth
below, has acquired beneficial ownership of 15% or more of the outstanding
voting stock of the Corporation (an "Acquiring Person") or such earlier or later
date (not beyond the thirtieth day after the Stock Acquisition Date) as the
Board of Directors may determine or (ii) the tenth business day (or such later
date as may be determined by the Board of Directors prior to such time as any
person or group of affiliated or associated persons becomes an Acquiring Person)
after the date of the commencement or announcement of a person's or group's
intention to commence a tender or exchange offer the consummation of which would
result in the ownership of 15% or more of the Corporation's outstanding voting
stock (even if no shares are actually purchased pursuant to such offer); prior
thereto, the Rights will not be exercisable, will not be represented by a
separate certificate, and will not be transferable apart from the Common Stock,
but will instead be evidenced, (i) with respect to any of the shares of Common
Stock held in uncertificated book-entry form (a "Book-Entry") outstanding as of
the Record Date, by such Book-Entry and (ii) with respect to the shares of
Common Stock evidenced by Common Stock certificates outstanding as of the Record
Date, by such Common Stock certificate, together with a copy of this Summary of
Rights. An Acquiring Person does not include (A) the Corporation, (B) any
subsidiary of the Corporation, (C) any employee benefit plan or employee stock
plan of the Corporation or of any subsidiary of the Corporation, or any trust or
other entity organized, appointed, established or holding Common Stock for or
pursuant to the terms of any such plan or (D) any person or group whose
ownership of 15% or more of the shares of voting stock of the Corporation then
outstanding results solely from (i) any action or transaction or transactions
approved by the Board of Directors before such person or group became an
Acquiring Person or (ii) a reduction in the number of outstanding shares of
voting stock of the Corporation pursuant to a transaction or transactions
approved by the Board of Directors (provided that any person or group that does
not become an Acquiring Person by reason of clause (i) or (ii) above shall
become an Acquiring Person upon acquisition of an additional 1% or more of the
Corporation's voting stock then outstanding unless such acquisition of
additional voting stock will not result in such person or group becoming an
Acquiring Person by reason of such clause (i) or (ii). For purposes of the
foregoing, outstanding voting stock of the Corporation includes voting stock
that trades on a "when issued" basis on a national securities exchange or on the
National Association of Securities Dealers, Inc. Automated Quotation System
("NASDAQ").
Until the Distribution Date (or earlier redemption or expiration of the
Rights), new Common Stock certificates issued after April 6, 1999 will contain a
legend incorporating the Rights Agreement by reference. Until the Distribution
Date (or earlier redemption or expiration of the Rights), transfer on the
Corporation's Direct Registration System of any Common Stock represented by a
Book-Entry or a certificate outstanding as of April 6, 1999, and, in each case,
with or without a copy of this Summary of Rights attached thereto, will also
constitute the transfer of the Rights associated with the Common Stock
represented by such Book-Entry or certificate. As soon as practicable following
the Distribution Date, separate certificates evidencing the Rights ("Rights
Certificates") will be mailed to holders of record of the Common Stock as of the
close of business on the Distribution Date and such separate Rights Certificates
alone will evidence the Rights from and after the Distribution Date.
The Rights are not exercisable until the Distribution Date. Unless earlier
redeemed by the Corporation as described below, the Rights will expire at the
close of business on April 6, 2009 (the "Expiration Date") (or, if the
Distribution Date shall have occurred before April 6, 2009, at the close of
business on the 90th day following the Distribution Date).
The Preferred Stock is nonredeemable and, unless otherwise provided in
connection with the creation of a subsequent series of preferred stock, and (i)
pari passu with the Corporation's Series A Junior Participating Cumulative
Preferred Stock and the Corporation's Series C Cumulative Redeemable Preferred
Stock, (ii) subordinate to any other series of the Corporation's preferred stock
and (iii) senior to the Common Stock. The Preferred Stock may not be issued
except upon exercise of Rights. Each share of Preferred Stock will be entitled
to receive when, as and if declared, a quarterly dividend in an amount equal to
(i) 1,000 times the cash dividends declared on the Corporation's Common Stock,
and (ii) a preferential cash dividend, if any, in preference to holders of
Common Stock in an amount equal to $25.00 per share of Preferred Stock less the
per share amount of all cash dividends declared on the Preferred Stock pursuant
to clause (i) since the immediately preceding quarterly dividend payment date.
In addition, Preferred Stock is entitled to 1,000 times any non-cash dividends
(other than dividends payable in equity securities) declared on the Common
Stock, in like kind. In the event of the liquidation of the Corporation, the
holders of Preferred Stock will be entitled to receive, for each share of
Preferred Stock, a payment in an amount equal to the greater of $1.00 per one
one-thousandth of a share plus accrued and unpaid dividends and distributions
thereon or 1,000 times the payment made per share of Common Stock. Each share of
Preferred Stock will have 1,000 votes, voting together with the Common Stock. In
the event of any merger, consolidation or other transaction in which Common
Stock is exchanged, each share of Preferred Stock will be entitled to receive
1,000 times the amount received per share of Common Stock. The rights of
Preferred Stock as to dividends, liquidation and voting are protected by
anti-dilution provisions. If the dividends accrued on the Preferred Stock for
four or more quarterly dividend periods, whether consecutive or not, shall not
have been declared and paid or irrevocably set aside for payment, the holders of
record of the Preferred Stock of the Corporation of all series (including the
Preferred Stock) will have the right to elect two members to the Corporation's
Board of Directors.
The number of shares of Preferred Stock issuable upon exercise of the
Rights is subject to certain adjustments from time to time in the event of a
stock dividend on, or a subdivision or combination of, the Common Stock. The
Exercise Price for the Rights is subject to adjustment in the event of
extraordinary distributions of cash or other property to holders of Common
Stock.
Unless the Rights are earlier redeemed, in the event that, after the time
that a Person becomes an Acquiring Person, the Corporation were to be acquired
in a merger or other business combination (in which any shares of Common Stock
are changed into or exchanged for other securities or assets) or more than 50%
of the assets or earning power of the Corporation and its subsidiaries (taken as
a whole) were to be sold or transferred in one or a series of related
transactions, the Rights Agreement provides that proper provision will be made
so that each holder of record, other than the Acquiring Person, of a Right will
from and after such date have the right to receive, upon payment of the Exercise
Price, that number of shares of common stock of the acquiring company having a
market value at the time of such transaction equal to two times the Exercise
Price.
In addition, unless the Rights are earlier redeemed, in the event that a
person or group becomes an Acquiring Person, the Rights Agreement provides that
proper provision will be made so that each holder of record of a Right, other
than the Acquiring Person (whose Rights will thereupon become null and void),
will thereafter have the right to receive, upon payment of the Exercise Price,
that number of one one-thousandths of a share of Preferred Stock having a market
value at the time of the transaction equal to two times the Exercise Price (such
market value to be determined with reference to the market value of the
Corporation's Common Stock as provided in the Rights Agreement).
At any time after any person or group becomes an Acquiring Person and prior
to the acquisition by such person or group of 50% or more of the outstanding
voting stock, the Board of Directors of the Corporation may exchange the Rights
(other than Rights owned by such person or group which will have become void),
in whole or in part, at an exchange ratio of one share of Common Stock per Right
(subject to adjustment).
Fractions of shares of Preferred Stock (other than fractions which are
integral multiples of one one-thousandth of a share) may, at the election of the
Corporation, be evidenced by depositary receipts. The Corporation may also issue
cash in lieu of fractional shares which are not integral multiples of one
one-thousandth of a share.
At any time on or prior to the close of business on the earlier of (i) the
tenth day after the Stock Acquisition Date (or such later date as a majority of
the Board of Directors may determine) or (ii) the Expiration Date, the
Corporation may redeem the Rights in whole, but not in part, at a price of
$0.005 per Right (the "Redemption Price"). Immediately upon the effective time
of the action of the Board of Directors of the Corporation authorizing
redemption of the Rights, the right to exercise the Rights will terminate and
the only right of the holders of Rights will be to receive the Redemption Price.
For as long as the Rights are then redeemable, the Corporation may, [except
with respect to the redemption price or date of expiration of the Rights,] amend
the Rights in any manner, including an amendment to extend the time period in
which the Rights may be redeemed. At any time when the Rights are not then
redeemable, the Corporation may amend the Rights in any manner that does not
materially adversely affect the interests of holders of the Rights as such.
Amendments to the Rights Agreement from and after the time that any Person
becomes an Acquiring Person and amendments to the redemption price or expiration
date of the Rights require the approval of a majority of the Continuing
Directors (as defined and provided in the Rights Agreement). Until a Right is
exercised, the holder, as such, will have no rights as a stockholder of the
Corporation, including, without limitation, the right to vote or to receive
dividends.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to the Corporation's report on Form 8-K
dated February 9, 1999. A copy of the Rights Agreement is available free of
charge from the Corporation. This summary description of the Rights does not
purport to be complete and is qualified in its entirety by reference to the
Rights Agreement which is incorporated in this summary description herein by
reference.
EXHIBIT B
TO RIGHTS AGREEMENT
[Form of Rights Certificate]
<TABLE>
<CAPTION>
<S> <C>
Certificate No. W - ________ Rights
</TABLE>
NOT EXERCISABLE AFTER (I) APRIL 6, 2009, OR (II) IF THE DISTRIBUTION DATE (AS
DEFINED BELOW) SHALL HAVE OCCURRED BEFORE THE DATE SPECIFIED IN CLAUSE (I), THE
DATE WHICH IS NINETY (90) DAYS AFTER APRIL 6, 2009, OR EARLIER IF REDEEMED. THE
RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY AND UNDER CERTAIN
OTHER CIRCUMSTANCES, AT $0.005 PER RIGHT (SUBJECT TO ADJUSTMENT), ON THE TERMS
SET FORTH OR REFERRED TO IN THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES AS
PROVIDED IN THE RIGHTS AGREEMENT (AS REFERRED TO BELOW), RIGHTS ISSUED TO OR
BENEFICIALLY OWNED BY ACQUIRING PERSONS OR THEIR AFFILIATES OR ASSOCIATES (AS
SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH
RIGHTS SHALL BE NULL AND VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.
Rights Certificate
This certifies that _________________, or registered assigns, is the
registered owner of the number of Rights set forth above, each of which
entitles the owner thereof, subject to the terms, provisions and conditions
of the Rights Agreement (the "Rights Agreement") by and between MediaOne
Group, Inc. (the "Corporation") and its Rights Agent (the "Rights Agent"), to
purchase from the Corporation at any time after the Distribution Date (as
such term is defined in the Rights Agreement) and prior to 5:00 p.m. (New
York City time) on April 6, 2009 (or if the Distribution Date shall have
occurred before April 6, 2009, at the close of business on the 90th day
following the Distribution Date) at the office of the Rights Agent
designated in the Rights Agreement for such purpose, or its successor as
Rights Agent, in New York, NY, one one-thousandth (1/1,000) of a fully paid
nonassessable share of Series F Junior Participating Cumulative Preferred
Stock, par value $1.00 per share, of the Corporation (the "Preferred
Stock") at a purchase price of $225, as the same may from time to time be
adjusted in accordance with the Rights Agreement (the "Exercise Price"),
upon presentation and surrender of this Rights Certificate with the Form of
Election to Purchase attached hereto duly executed.
As provided in the Rights Agreement, the Exercise Price and the number of
shares of Preferred Stock 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 and, upon the happening of certain events,
securities other than shares of Preferred Stock, or other property, may be
acquired upon exercise of the Rights evidenced by this Rights Certificate, as
provided in the Rights Agreement.
This Rights Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
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 of the Rights Agent,
the Corporation and the holders of record of Rights Certificates. Copies of the
Rights Agreement are on file at the principal executive office of the
Corporation.
This Rights Certificate, with or without other Rights Certificates, upon
surrender at the office of the Rights Agent designated in the Rights Agreement
for such purpose, may be exchanged for another Rights Certificate or Rights
Certificates of like tenor and date evidencing Rights entitling the holder of
record to purchase a like aggregate number of shares 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 Corporation at its option or under
certain other circumstances at a redemption price of $0.005 per Right. No
fractional shares of Preferred Stock (other than fractions which are integral
multiples of one one-thousandth (1/1,000) of a share) are required to be issued
upon the exercise of any Right or Rights evidenced hereby, and in lieu thereof
the Corporation may cause depositary receipts to be issued and/or a cash payment
may be made, as provided in the Rights Agreement.
No holder of this Rights Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of Preferred Stock or
of any other securities of the Corporation 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 Corporation or any right to vote for the election of
directors or upon any matter submitted to stockholders at 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 Corporation
and its corporate seal. Dated as of _____________, ____.
ATTEST:
_________________________________ By:_______________________________
Secretary Title:
Countersigned:
[RIGHTS AGENT]
By:______________________________
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 Certificates.)
FOR VALUE RECEIVED _____________________________________ hereby sells,
assigns and transfers unto __________________________
__________________________________________________________________ (Please print
name and address of transferee)
_____________________________________________________________________ Rights
evidenced by 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 Corporation, with full power of
substitution.
Dated: ________________, ____
____________________________________
Signature
Signature Guaranteed:
Certificate
The undersigned hereby certifies by checking the appropriate boxes that:
(1) this Rights Certificate [ ] is [ ] is not being sold, assigned or
transferred by or on behalf of a Person who is or was an Acquiring Person
or an Associate or an Affiliate thereof (as such terms are defined in the
Rights Agreement); and
(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 thereof (as such terms are defined in the Rights
Agreement). Dated: ________________, ____
__________________________________________
Signature
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 registered holder
desires to exercise the Rights Certificate.)
TO:_________________
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 such Rights and requests that
certificates for such share(s) be issued in the following name:
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 remaining of such Rights shall be registered in the
name of and delivered to:
Please insert social security or other identifying number:
______________________________
______________________________________________________________________________
(Please print name and address)
______________________________________________________________________________
Dated: ________________, ____
____________________________________
Signature
Signature must conform in all respects to name of holder as specified
on the fact of this Rights Certificate)
Signature Guaranteed
EXHIBIT C
TO RIGHTS AGREEMENT
FORM OF CERTIFICATE OF DESIGNATIONS
OF
SERIES F JUNIOR PARTICIPATING CUMULATIVE PREFERRED STOCK
OF
MEDIAONE GROUP, INC.
Pursuant to Section 151 of the Delaware
General Corporation Law
I, _____________, _______________________ of MediaOne Group, Inc., a
corporation organized and existing under the Delaware General Corporation Law
(the "Corporation"), in accordance with the provisions of Section 151 of such
law, DO HEREBY CERTIFY that: pursuant to the authority conferred upon the Board
of Directors by the Restated Certificate of Incorporation of the Corporation and
pursuant to Section 151 of the Delaware General Corporation Law the Board of
Directors on February 5, 1999 adopted the following resolution which creates a
series of 2,000,000 shares of Preferred Stock designated as Series F Junior
Participating Cumulative Preferred Stock.
RESOLVED, that pursuant to the authority vested in the Board of Directors
of the Corporation in accordance with the provisions of its Restated Certificate
of Incorporation, a series of Preferred Stock of the Corporation be, and hereby
is, created and that the designation and amount thereof and the voting powers,
preferences and relative, participating, optional or 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 F Junior Participating Cumulative Preferred Stock" (the
"Series F Preferred Stock") and the number of shares constituting such series
shall be 2,000,000.
Section 2. Dividends and Distributions.
(A) Subject to the provisions for adjustment hereinafter set forth, the holders
of shares of Series F 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, (i) cash dividends in an amount per share (rounded to the
nearest cent) equal to 1,000 times the aggregate per share amount of all
cash dividends declared or paid on the Common Stock, $0.01 par value per
share, of the Corporation (the "Common Stock") and (ii) a preferential cash
dividend (the "Preferential Dividends"), if any, on the first day of
February, May, August and November of each year (each 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 F
Preferred Stock, in an amount (except in the case of the first Quarterly
Dividend Payment Date if the date of the first issuance of Series F
Preferred Stock is a date other than a Quarterly Dividend Payment Date, in
which case such payment shall be a prorated amount of such amount) equal to
$25.00 per share of Series F Preferred Stock less the per share amount of
all cash dividends declared on the Series F Preferred Stock pursuant to
clause (i) of this sentence 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 F Preferred Stock. In the event the Corporation shall, at any
time after the issuance of any share or fraction of a share of Series F
Preferred Stock, make any distribution on the shares of Common Stock of the
Corporation, whether by way of a dividend or a reclassification of stock, a
recapitalization, reorganization or partial liquidation of the Corporation
or otherwise, which is payable in cash or any debt security, debt
instrument, real or personal property or any other property (other than
cash dividends subject to the immediately preceding sentence, a
distribution of shares of Common Stock or other capital stock of the
Corporation or a distribution of rights or warrants to acquire any such
share, including any debt security convertible into or exchangeable for any
such share, at a price less than the Fair Market Value (as hereinafter
defined) of such share), then, and in each such event the Corporation shall
simultaneously pay on each then outstanding share of Series F Preferred
Stock of the Corporation a distribution, in like kind, of 1,000 times such
distribution paid on a share of Common Stock (subject to the provisions for
adjustment hereinafter set forth). The dividends and distributions on the
Series F Preferred Stock to which holders thereof are entitled pursuant to
clause (i) of the first sentence of this paragraph and pursuant to the
second sentence of this paragraph are hereinafter referred to as
"Participating Dividends" and the multiple of such cash and non-cash
dividends on the Common Stock applicable to the determination of the
Participating Dividends, which shall be 1,000 initially but shall be
adjusted from time to time as hereinafter provided, is hereinafter referred
to as the "Dividend Multiple". In the event the Corporation shall at any
time after April 6, 2009 (the "Effective Date") declare or pay any dividend
or make any distribution on Common Stock payable in shares of Common Stock,
or effect a subdivision or split or a combination, consolidation or reverse
split of the outstanding shares of Common Stock into a greater or lesser
number of shares of Common Stock, or issue any of its capital stock in a
reclassification of the Common Stock (including any such reclassification
in connection with a consolidation or merger in which the Corporation is
the continuing or surviving corporation), then in each such case the
Dividend Multiple thereafter applicable to the determination of the amount
of Participating Dividends which holders of shares of Series F Preferred
Stock shall be entitled to receive shall be the Dividend Multiple
applicable immediately prior to such event multiplied 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 each Participating Dividend at the same time
it declares any cash or non-cash dividend or distribution on the Common
Stock in respect of which a Participating Dividend is required to be paid.
No cash or non-cash dividend or distribution on the Common Stock in respect
of which a Participating Dividend is required to be paid shall be paid or
set aside for payment on the Common Stock unless a Participating Dividend
in respect of such dividend or distribution on the Common Stock shall be
simultaneously paid, or set aside for payment, on the Series F Preferred
Stock.
(C) Preferential Dividends shall begin to accrue on outstanding shares of
Series F Preferred Stock from the Quarterly Dividend Payment Date next
preceding the date of issuance of any shares of Series F Preferred Stock.
Accrued but unpaid Preferential Dividends shall cumulate but shall not bear
interest. Preferential Dividends paid on the shares of Series F 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.
Section 3. Voting Rights.
The holders of shares of Series F Preferred Stock shall have the
following voting rights:
(A) Subject to the provisions for adjustment hereinafter set forth, each share
of Series F Preferred Stock shall entitle the holder thereof to 1,000 votes
on all matters submitted to a vote of the stockholders of the Corporation.
The number of votes which a holder of Series F Preferred Stock is entitled
to cast, as the same may be adjusted from time to time as hereinafter
provided, is hereinafter referred to as the "Vote Multiple". In the event
the Corporation shall at any time after the Effective Date declare or pay
any dividend on Common Stock payable in shares of Common Stock, or effect a
subdivision or split or a combination, consolidation or reverse split of
the outstanding shares of Common Stock into a greater or lesser number of
shares of Common Stock, or issue any of its capital stock in a
reclassification of the Common Stock (including any such reclassification
in connection with a consolidation or merger in which the Corporation is
the continuing or surviving corporation, then in each such case the Vote
Multiple thereafter applicable to the determination of the number of votes
per share to which holders of shares of Series F Preferred Stock shall be
entitled after such event shall be the Vote Multiple immediately prior to
such event multiplied by a fraction the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in the Certificate of Incorporation or
By-Laws, the holders of shares of Series F 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) In the event that the Preferential Dividends accrued on the Series F
Preferred Stock for four or more quarterly dividend periods, whether
consecutive or not, shall not have been declared and paid or set apart for
payment, the holders of record of Preferred Stock of the Corporation of all
series (including the Series F Preferred Stock), other than any series in
respect of which such right is expressly withheld by the Certificate of
Incorporation or the authorizing resolutions included in the Certificate of
Designations therefor, shall have the right, at the next meeting of
stockholders called for the election of directors, to elect two members to
the Board of Directors, which directors shall be in addition to the number
required by the By-Laws prior to such event, to serve until the next Annual
Meeting and until their successors are elected and qualified or their
earlier resignation, removal or incapacity or until such earlier time as
all accrued and unpaid Preferential Dividends upon the outstanding shares
of Series F Preferred Stock shall have been paid (or irrevocably set aside
for payment) in full. The holders of shares of Series F Preferred Stock
shall continue to have the right to elect directors as provided by the
immediately preceding sentence until all accrued and unpaid Preferential
Dividends upon the outstanding shares of Series F Preferred Stock shall
have been paid (or set aside for payment) in full. Such directors may be
removed and replaced by such stockholders, and vacancies in such
directorships may be filled only by such stockholders (or by the remaining
director elected by such stockholders, if there be one) in the manner
permitted by law; provided, however, that any such action by stockholders
shall be taken at a meeting of stockholders and shall not be taken by
written consent thereto.
(D) Except as otherwise required by the Certificate of incorporation or By-Laws
or set forth herein, holders of Series F 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 the taking of any corporate action.
Section 4. Certain Restrictions.
(A) Whenever Preferential Dividends or Participating Dividends are in arrears
or the Corporation shall be in default of payment thereof, thereafter and
until all accrued and unpaid Preferential Dividends and Participating
Dividends, whether or not declared, on shares of Series F Preferred Stock
outstanding shall have been paid or set aside for payment in full, and in
addition to any and all other rights which any holder of shares of Series F
Preferred Stock may have in such circumstances, 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 F Preferred Stock;
(ii) declare or pay dividends on or make any other distributions on any
shares of stock ranking on a parity as to dividends with the Series F
Preferred Stock, unless dividends are paid ratably on the Series F
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 if the full dividends
accrued thereon were to be paid;
(iii)except as permitted by subparagraph (iv) of this paragraph 4(A),
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 F 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 (both as to
dividends and upon liquidation, dissolution or winding up) to the
Series F Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any shares of Series F
Preferred Stock, or any shares of stock ranking on a parity with the
Series F Preferred Stock (either as to dividends or upon liquidation,
dissolution or winding up), except in accordance with a purchase offer
made 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 (as hereinafter defined) 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. A "Subsidiary" of the Corporation shall
mean any corporation or other entity of which securities or other ownership
interests having ordinary voting power sufficient to elect a majority of
the Board of Directors or other persons performing similar functions are
Beneficially Owned, directly or indirectly, by the Corporation or by any
corporation or other entity that is otherwise controlled by the
Corporation.
(C) The Corporation shall not issue any shares of Series F Preferred Stock
except upon exercise of Rights issued pursuant to that certain Rights
Agreement by and between the Corporation and the Rights Agent, a copy
of which is on file with the Secretary of the Corporation at its
principal executive office and shall be made available to stockholders
of record without charge upon written request therefor addressed to
said Secretary. Notwithstanding the foregoing sentence, nothing
contained in the provisions hereof shall prohibit or restrict the
Corporation from issuing for any purpose any series of Preferred Stock
with rights and privileges similar to, different from, or greater
than, those of the Series F Preferred Stock.
Section 5. Reacquired Shares.
Any shares of Series F Preferred Stock purchased or otherwise acquired
by the Corporation in any manner whatsoever shall be retired and canceled
promptly after the acquisition thereof. All such shares upon their
retirement and cancellation shall become authorized but unissued shares of
Preferred Stock, without designation as to series, and such shares may be
reissued as part of a new series of Preferred Stock to be created by
resolution or resolutions of the Board of Directors.
Section 6. Liquidation, Dissolution or Winding Up.
Upon any voluntary or involuntary liquidation, dissolution or winding
up of the Corporation, no distribution shall be made (i) to the holders of
shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series F Preferred Stock unless the
holders of shares of Series F Preferred Stock shall have received, subject
to adjustment as hereinafter provided, (A) $1,000 ($1.00 per one
one-thousandth of a share) plus an amount equal to accrued and unpaid
dividends and distributions thereon, whether or not declared, to the date
of such payment, or (B) if greater than the amount specified in clause
(i)(A) of this sentence, an amount equal to 1,000 times the aggregate
amount to be distributed per share to holders of Common Stock, as the same
may be adjusted as hereinafter provided, and (ii) to the holders of stock
ranking on a parity upon liquidation, dissolution or winding up with the
Series F Preferred Stock, unless simultaneously therewith distributions are
made ratably on the Series F Preferred Stock and all other shares of such
parity stock in proportion to the total amounts to which the holders of
shares of Series F Preferred Stock are entitled under clause (i)(A) of this
sentence and to which the holders of such parity shares are entitled, in
each case upon such liquidation, dissolution or winding up. The amount to
which holders of Series F Preferred Stock may be entitled upon liquidation,
dissolution or winding up of the Corporation pursuant to clause (i)(B) of
the foregoing sentence is hereinafter referred to as the "Participating
Liquidation Amount" and the multiple of the amount to be distributed to
holders of shares of Common Stock upon the liquidation, dissolution or
winding up of the Corporation applicable pursuant to said clause to the
determination of the Participating Liquidation Amount, as said multiple may
be adjusted from time to time as hereinafter provided, is hereinafter
referred to as the "Liquidation Multiple". In this event the Corporation
shall at any time after the Effective Date declare or pay any dividend on
Common Stock payable in shares of Common Stock, or effect a subdivision or
split or a combination, consolidation or reverse split of the outstanding
shares of Common Stock into a greater or lesser number of shares of Common
Stock, or issue any of its capital stock in a reclassification of the
Common Stock (including any such reclassification in connection with a
consolidation or merger in which the Corporation is the continuing or
surviving corporation, then in each such case the Liquidation Multiple
thereafter applicable to the determination of the Participating Liquidation
Amount to which holders of Series F Preferred Stock shall be entitled after
such event shall be the Liquidation Multiple applicable immediately prior
to such event multiplied 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. Certain Reclassifications and Other Events.
(A) In the event that holders of shares of Common Stock of the Corporation
receive after the Effective Date, in respect of their shares of Common
Stock any share of capital stock of the Corporation (other than any share
of Common Stock of the Corporation), whether by way of reclassification,
recapitalization, reorganization, dividend or other distribution or
otherwise (a "Transaction"), then, and in each such event the dividend
rights, voting rights and rights upon the liquidation, dissolution or
winding up of the Corporation of the shares of Series F Preferred Stock
shall be adjusted so that after such event the holders of Series F
Preferred Stock shall be entitled, in respect of each share of Series F
Preferred stock held, in addition to such rights in respect thereof to
which such holder was entitled immediately prior to such adjustment, to
(i) such additional dividends as equal the Dividend Multiple in effect
immediately prior to such Transaction multiplied by the additional
dividends which the holder of a share of Common Stock shall be entitled to
receive by virtue of the receipt in the Transaction of such capital stock,
(ii) such additional voting rights as equal the Vote Multiple in effect
immediately prior to such Transaction multiplied by the additional voting
rights which the holder of a share of Common Stock shall be entitled to
receive by virtue of the receipt in the Transaction of such capital stock
and (iii) such additional distributions upon liquidation, dissolution or
winding up of the Corporation as equal the Liquidation Multiple in effect
immediately prior to such Transaction multiplied by the additional amount
which the holder of a share of Common Stock shall be entitled to receive
upon liquidation, dissolution or winding up of the Corporation by virtue of
the receipt in the Transaction of such capital stock, as the case may be,
all as provided by the terms of such capital stock.
(B) In the event that holders of shares of Common Stock of the Corporation
receive after the Effective Date, in respect of their shares of Common
Stock any right or warrant to purchase Common Stock (including as such a
right, for all purposes of this paragraph, any security convertible into or
exchangeable for Common Stock) at a purchase price per share less than the
Fair Market Value (as hereinafter defined) of a share of Common Stock on
the date of issuance of such right or warrant, then and in each such event
the dividend rights, voting rights and rights upon the liquidation,
dissolution or winding up of the Corporation of the shares of Series F
Preferred Stock shall each be adjusted so that after such event the
Dividend Multiple, the Vote Multiple and the Liquidation Multiple shall
each be the product of the Dividend Multiple, the Vote Multiple and the
Liquidation Multiple, as the case may be, in effect immediately prior to
such event multiplied by a fraction the numerator of which shall be the
number of shares of Common Stock outstanding immediately before such
issuance of rights or warrants plus the maximum number of shares of Common
Stock which could be acquired upon exercise in full of all such rights or
warrants and the denominator of which shall be the number of shares of
Common Stock outstanding immediately before such issuance of rights or
warrants plus the number of shares of Common Stock which could be
purchased, at the Fair Market Value of the Common Stock at the time of such
issuance, by the maximum aggregate consideration payable upon exercise in
full of all such rights or warrants.
(C) In the event that holders of shares of Common Stock of the Corporation
receive after the Effective Date in respect of their shares of Common Stock
any right or warrant to purchase capital stock of the Corporation (other
than shares of Common Stock), including as such a right, for all purposes
of this paragraph, any security convertible into or exchangeable for
capital stock of the Corporation, (other than Common Stock), at a purchase
price per share less than the Fair Market Value of such shares of capital
stock on the date of issuance of such right or warrant, then and in each
such event the dividend rights, voting rights and rights upon liquidation,
dissolution or winding up of the Corporation of the shares of Series F
Preferred Stock shall each be adjusted so that after such event each holder
of a share of Series F Preferred Stock shall be entitled, in respect of
each share of Series F Preferred Stock held, in addition to such rights in
respect thereof to which such holder was entitled immediately prior to such
event, to receive (i) such additional dividends as equal the Dividend
Multiple in effect immediately prior to such event multiplied, first, by
the additional dividends to which the holder of a share of Common Stock
shall be entitled upon exercise of such right or warrant by virtue of the
capital stock which could be acquired upon such exercise and multiplied
again by the Discount Fraction (as hereinafter defined) and (ii) such
additional voting rights as equal the Vote Multiple in effect immediately
prior to such event multiplied, first, by the additional voting rights to
which the holder of a share of Common Stock shall be entitled upon exercise
of such right or warrant by virtue of the capital stock which could be
acquired upon such exercise and multiplied again by the Discount Fraction
and (iii) such additional distribution upon liquidation, dissolution or
winding up of the Corporation as equal the Liquidation Multiple in effect
immediately prior to such event multiplied, first, by the additional amount
which the holder of a share of Common Stock shall be entitled to receive
upon liquidation, dissolution or winding up of the Corporation upon
exercise of such right or warrant by virtue of the capital stock which
could be acquired upon such exercise and multiplied again by the Discount
Fraction. For purposes of this paragraph, the "Discount Fraction" shall be
a fraction the numerator of which shall be the difference between the Fair
Market Value of a share of the capital stock subject to a right or warrant
distributed to holders of shares of Common Stock of the Corporation as
contemplated by this paragraph immediately after the distribution thereof
and the purchase price per share for such share of capital stock pursuant
to such right or warrant and the denominator of which shall be the Fair
Market Value of a share of such capital stock immediately after the
distribution of such right or warrant.
(D) For purposes of this Certificate of Designations, the "Fair Market Value"
of a share of capital stock of the Corporation (including a share of Common
Stock) on any date shall be deemed to be the average of the daily closing
price per share thereof over the 30 consecutive Trading Days (as such term
is hereinafter defined) immediately prior to such date; provided, however,
that, in the event that such Fair Market Value of any such share of capital
stock is determined during a period which includes any date that is within
30 Trading Days after (i) the ex-dividend date for a dividend or
distribution on stock payable in shares of such stock or securities
convertible into shares of such stock, or (ii) the effective date of any
subdivision, split, combination, consolidation, reverse stock split or
reclassification of such stock, then, and in each such case, the Fair
Market Value shall be appropriately adjusted by the Board of Directors of
the Corporation to take into account ex-dividend or post-effective date
trading. The closing price for any day shall be the last sale price,
regular way, or, in case, no such sale takes place on such day, the average
of the closing bid and asked prices, regular way (in either case, as
reported in the applicable transaction reporting system with respect to
securities listed or admitted to trading on the New York Stock Exchange),
or, if the shares are not listed or admitted to trading on the New York
Stock Exchange, as reported in the applicable transaction reporting system
with respect to securities listed on the principal national securities
exchange on which the shares are listed or admitted to trading or, if the
shares 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 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 shares selected by the Board of Directors of the
Corporation. The term "Trading Day" shall mean a day in which the principal
national securities exchange on which the shares are listed or admitted to
trading is open for the transaction of business or, if the shares are not
listed or admitted to trading on any national securities exchange, on which
the New York Stock Exchange or such other national securities exchange as
may be selected by the Board of Directors of the Corporation is open. If
the shares are not publicly held or not so listed or traded on any day
within the period of 30 Trading Days applicable to the determination of
Fair Market Value thereof as aforesaid, "Fair Market Value" shall mean the
fair market value thereof per share as determined in good faith by the
Board of Directors of the Corporation. In either case referred to in the
foregoing sentence, the determination of Fair Market Value shall be
described in a statement filed with the Secretary of the Corporation.
Section 8. Consolidation, Merger, etc.
In case the Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash and/or any
other property, then in any such case each outstanding share of Series F
Preferred Stock shall at the same time be similarly exchanged for or
changed into the aggregate amount of stock, securities, cash and/or other
property (payable in like kind), as the case may be, for which or into
which each share of Common Stock is changed or exchanged multiplied by the
highest of the Vote Multiple, the Dividend Multiple or the Liquidation
Multiple in effect immediately prior to such event.
Section 9. Effective Time of Adjustments.
(A) Adjustments to the Series F Preferred Stock required by the provisions
hereof shall be effective as of the time at which the event requiring such
adjustments occurs.
(B) The Corporation shall give prompt written notice to each holder of a share
of Series F Preferred Stock of the effect of any adjustment to the voting
rights, dividend rights or rights upon liquidation, dissolution or winding
up of the Corporation of such shares required by the provisions hereof.
Notwithstanding the foregoing sentence, the failure of the Corporation to
give such notice shall not affect the validity of or the force or effect of
or the requirement for such adjustment.
Section 10. No Redemption.
The shares of Series F Preferred Stock shall not be redeemable at the
option of the Corporation or any holder thereof. Notwithstanding the
foregoing sentence of this Section, the Corporation may acquire shares of
Series F Preferred Stock in any other manner permitted by law, the
provisions hereof and the Certificate of Incorporation of the Corporation.
Section 11. Ranking.
Unless otherwise provided in the Restated Certificate of Incorporation
of the Corporation or a Certificate of Designations relating to a series of
preferred stock of the Corporation established after the issuance of any
share of Series F Preferred Stock or any right, warrant, or option
providing for the issuance thereof, the Series F Preferred Stock shall
rank, as to the payment of dividends and the distribution of assets on
liquidation, dissolution or winding up, (i) pari passu with the Series A
Junior Participating Cumulative Preferred Stock, par value $1.00 per share,
(ii) pari passu with the Series C Cumulative Redeemable Preferred Stock,
par value $1.00 per share, (iii) junior to all other series of the
Corporation's Preferred Stock and (iv) senior to the Common Stock.
Section 12. Amendment.
The provisions hereof and the Certificate of Incorporation of the
Corporation shall not be amended in any manner which would adversely affect
the rights, privileges or powers of the Series F Preferred Stock without,
in addition to any other vote of stockholders required by law, the
affirmative vote of the holders of two-thirds or more of the outstanding
shares of Series F Preferred Stock, voting together as a single class.
Section 13. Fractional Shares.
Series F Preferred Stock may be issued in fractions of a share (in one
one-thousandths (1/1,000) of a share and integral multiples thereof) that
shall entitle the holder thereof, in proportion to such holder's fractional
shares, to exercise voting rights, receive dividends, participate in
distributions and have the benefit of all other rights of holders of shares
of Series F Preferred Stock.
IN WITNESS WHEREOF, I have executed and subscribed this Certificate to
Designations and do affirm the foregoing as true under the penalties of perjury
this ___ day of February, 1999.
Name:
Title:
ATTEST:
Secretary
