SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
WESTBANK CORPORATION
(Exact name of registrant as specified in charter)
Massachusetts 04-2830731
(State or other jurisdiction (IRS employer
of incorporation) identification no.)
225 Park Avenue, P.O. Box 149, West Springfield, MA 01090-0149
(Address of principal executive offices) (Zip code)
Securities to be registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which each class is
to be so registered to be registered
None None
Securities to be registered pursuant to Section 12(g) of the Act:
Preferred Stock Purchase Rights
(Title of Class)
<PAGE>
Item 1. Description of Registrant's Securities to be Registered.
On November 19, 1997, the Board of Directors of the Company
adopted an Amended and Restated Shareholder Rights Agreement (the
Rights Agreement ). The following description of the terms of the
Rights Agreement does not purport to be complete and is qualified in
its entirety by reference to the Rights Agreement.
Pursuant to the terms of the Rights Agreement, the Board of
Directors declared a dividend distribution of one Preferred Stock
Purchase Right (a Right ) for each outstanding share of Common Stock
of the Company (the Common Stock ) to stockholders of record as of
the close of business on December 3, 1997 (the Record Date ). In
addition, one Right will automatically attach to each share of
Common Stock issued between the Record Date and the Distribution
Date (as hereinafter defined). Each Right entitles the registered
holder thereof to purchase from the Company a unit consisting of one
ten-thousandth of a share (a Unit ) of Series A Junior Participating
Cumulative Preferred Stock, par value $5.00 per share (the Preferred
Stock ), at a cash exercise price of $60.00 per Unit (the Exercise
Price ), subject to adjustment.
Initially, the Rights are not exercisable and are attached to
and trade with all outstanding shares of Common Stock outstanding as
of, and issued subsequent to, the Record Date. The Rights will
separate from the Common Stock and will become exercisable upon the
earliest of (i) the close of business on the tenth calendar day
following the first public announcement that a person or group of
affiliated or associated persons has acquired beneficial ownership
of 15% or more of the outstanding shares of Common Stock (an
Acquiring Person ) (the date of said announcement being referred to
as the Stock Acquisition Date ), (ii) the close of business on the
tenth business day (or such other day as the Board of Directors may
determine) following the commencement of a tender offer or exchange
offer that would result upon its consummation in a person or group
becoming the beneficial owner of 15% or more of the outstanding
shares of Common Stock or (iii) the determination by the Board of
Directors that any person is an Adverse Person (the earliest of such
dates being herein referred to as the Distribution Date ).
The Board of Directors may declare a person to be an Adverse
Person after a determination that such person, alone or together
with its affiliates and associates, has become the beneficial owner
of 10% or more of the outstanding shares of Common Stock and a
determination by the Board of Directors, after reasonable inquiry
and investigation, including such consultation, if any, with such
persons as the directors shall deem appropriate, that (a) such
beneficial ownership by such person is intended to cause, is
reasonably likely to cause or will cause the Company to repurchase
the Common Stock beneficially owned by such person or to cause
pressure on the Company to take action or enter into a transaction
or series of transactions which would provide such person with
short-term financial gain under circumstances where the Board of
Directors determines that the best long-term interests of the
Company and its stockholders, but for the actions and possible
actions of such person, would not be served by taking such action or
entering into such transaction or series of transactions at that
<PAGE>
time or (b) such beneficial ownership is causing, or is reasonably
likely to cause, a material adverse impact (including, but not
limited to, impairment of relationships with customers or impairment
of the Company s ability to maintain its competitive position) on
the business or prospects of the Company. No delay or failure by
the Board of Directors to declare a person to be an Adverse Person
shall in any way waive or otherwise affect the power of the Board of
Directors subsequently to declare a person an Adverse Person. In
the event that the Board of Directors should at any time determine,
upon reasonable inquiry and investigation, including consultation
with such persons as the Board of Directors shall deem appropriate,
that such person has not met or complied with any condition
specified by the Board of Directors, the Board of Directors may at
any time thereafter declare the person to be an Adverse Person.
Until the Distribution Date (or earlier redemption, exchange or
expiration of the Rights), (a) the Rights will be evidenced by the
Common Stock certificates and will be transferred with and only with
such Common Stock certificates, (b) new Common Stock certificates
issued after the Record Date will contain a notation incorporating
the Rights Agreement by reference, and (c) the surrender for
transfer of any certificates for Common Stock will also constitute
the transfer of the Rights associated with the Common Stock
represented by such certificate.
The Rights are not exercisable until the Distribution Date and
will expire at the close of business on November 19, 2007, unless
previously redeemed or exchanged by the Company as described below.
As soon as practicable after the Distribution Date, Right
Certificates will be mailed to holders of record of Common Stock as
of the close of business on the Distribution Date and, thereafter,
the separate Right Certificates alone will represent the Rights.
Except as otherwise determined by the Board of Directors, only
shares of Common Stock issued prior to the Distribution Date will be
issued with Rights.
In the event that a Stock Acquisition Date occurs or the Board
of Directors determines that a person is an Adverse Person, proper
provision will be made so that each holder of a Right (other than an
Acquiring Person, an Adverse Person or their associates or
affiliates, whose Rights shall become null and void) will thereafter
have the right to receive upon exercise that number of Units of
Preferred Stock of the Company having a market value of two times
the exercise price of the Right (such right being referred to as the
Subscription Right ). In the event that, at any time following the
Stock Acquisition Date, (i) the Company consolidates with, or merges
with and into, any other person, and the Company is not the
continuing or surviving corporation, (ii) any person consolidates
with the Company, or merges with and into the Company and the
Company is the continuing or surviving corporation of such merger
and, in connection with such merger, all or part of the shares of
Common Stock are changed into or exchanged for stock or other
securities of any other person or cash or any other property, or
(iii) 50% or more of the Company s assets or earning power is sold,
mortgaged or otherwise transferred, each holder of a Right shall
<PAGE>
thereafter have the right to receive, upon exercise, common stock of
the acquiring company having a market value equal to two times the
exercise price of the Right (such right being referred to as the
Merger Right ). The holder of a Right will continue to have the
Merger Right whether or not such holder has exercised the
Subscription Right. Rights that are or were beneficially owned by
an Acquiring Person or an Adverse Person may (under certain
circumstances specified in the Rights Agreement) become null and
void.
At any time after the Stock Acquisition Date occurs or the
Board of Directors determines that a person is an Adverse Person,
the Board of Directors may, at its option, exchange all or any part
of the then outstanding and exercisable Rights for shares of Common
Stock or Units of Preferred Stock at an exchange ratio of one share
of Common Stock or one Unit of Preferred Stock per Right.
Notwithstanding the foregoing, the Board of Directors generally will
not be empowered to effect such exchange at any time after any
person becomes the beneficial owner of 50% or more of the Common
Stock of the Company.
The Exercise Price payable, and the number of Units of
Preferred Stock or other securities or property issuable, upon
exercise of the Rights are subject to adjustment from time to time
to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred
Stock, (ii) if holders of the Preferred Stock are granted certain
rights or warrants to subscribe for Preferred Stock or convertible
securities at less than the current market price of the Preferred
Stock, or (iii) upon the distribution to holders of the Preferred
Stock of evidences of indebtedness or assets (excluding regular
quarterly cash dividends) or of subscription rights or warrants
(other than those referred to above).
With certain exceptions, no adjustment in the Exercise Price
will be required until cumulative adjustments amount to at least 1%
of the Exercise Price. The Company is not obligated to issue
fractional Units. If the Company elects not to issue fractional
Units, in lieu thereof an adjustment in cash will be made based on
the fair market value of the Preferred Stock on the last trading
date prior to the date of exercise. Any of the provisions of the
Rights Agreement may be amended by the Board of Directors of the
Company at any time prior to the Distribution Date.
The Rights may be redeemed in whole, but not in part, at a
price of $0.001 per Right (payable in cash, Common Stock or other
consideration deemed appropriate by the Board of Directors) by the
Board of Directors only until the earliest of (i) the date on which
a person is declared to be an Adverse Person, (ii) the close of
business on the tenth calendar day after the Stock Acquisition Date,
or (iii) the expiration date of the Rights Agreement. Immediately
upon the action of the Board of Directors ordering redemption of the
Rights, the Rights will terminate and thereafter the only right of
the holders of Rights will be to receive the redemption price.
The Rights Agreement may be amended by the Board of Directors
<PAGE>
in its sole discretion until the Distribution Date. After the
Distribution Date, the Board of Directors may, subject to certain
limitations set forth in the Rights Agreement, amend the Rights
Agreement only to cure any ambiguity, defect or inconsistency, to
shorten or lengthen any time period, or to make changes that do not
adversely affect the interests of Rights holders (excluding the
interests of an Acquiring Person, an Adverse Person or their
associates or affiliates). In addition, the Board of Directors may
at any time prior to such time as any person becomes an Acquiring
Person amend the Rights Agreement to lower the threshold at which a
person becomes an Acquiring Person to not less than the greater of
(i) the sum of .001% and the largest percentage of the outstanding
Common Stock then owned by any person and (ii) 10%.
Until a Right is exercised, the holder will have no rights as a
stockholder of the Company (beyond those as an existing
stockholder), including the right to vote or to receive dividends.
While the distribution of the Rights will not be taxable to
stockholders or to the Company, stockholders may, depending upon the
circumstances, recognize taxable income in the event that the Rights
become exercisable for Units, other securities of the Company, other
consideration or for common stock of an acquiring company.
The certificate of vote of directors establishing the Preferred
Stock and the form of Right Certificate are attached as Exhibits A
and B, respectively, to the Rights Agreement (which is included as
Exhibit 1 to this Form 8-A). The foregoing 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
herein by reference.
Item 2 - Exhibits
Exhibit 1 Amended and Restated Shareholder Rights Agreement, dated
November 19, 1997, between Westbank Corporation and
State Street Bank and Trust Company, as Rights
Agent.
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this
registration statement to be signed on its behalf by the
undersigned, thereto duly authorized.
WESTBANK CORPORATION
Date: November 24, 1997 By:/s/ Donald R. Chase
Donald R. Chase
President and Chief Executive Officer
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
1 Amended and Restated Shareholder Rights Agreement, dated
November 19, 1997, between Westbank Corporation and
State Street Bank and Trust Company, as Rights Agent
WESTBANK CORPORATION
and
STATE STREET BANK AND TRUST COMPANY,
as Rights Agent
Amended and Restated Shareholder Rights Agreement
Dated as of November 19, 1997
<PAGE>
TABLE OF CONTENTS
Section Page
1. Certain Definitions 2
2. Amendment and Restatement of the Original Rights Agreement;
Appointment of Rights Agent 6
3. Issue of Right Certificates 7
4. Form of Right Certificates 9
5. Countersignature and Registration 10
6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates 11
7. Exercise of Rights; Exercise Price; Expiration Date of
Rights 12
8. Cancellation and Destruction of Right Certificates 14
9. Reservation and Availability of Preferred Stock 14
10. Preferred Stock Record Date 15
11. Adjustment of Exercise Price, Number and Kind of Shares or
Number of Rights 16
12. Certificate of Adjusted Exercise Price or Number of Shares 25
13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power 25
14. Fractional Rights and Fractional Shares 29
15. Rights of Action 29
16. Agreement of Right Holders 30
17. Right Certificate Holder Not Deemed a Shareholder 30
18. Concerning the Rights Agent 31
19. Merger or Consolidation or Change of Name of Rights Agent 31
<PAGE>
20. Duties of Rights Agent 32
21. Change of Rights Agent 34
22. Issuance of New Right Certificates 35
23. Redemption 35
24. Exchange 36
25. Notice of Certain Events 38
26. Notices 39
27. Supplements and Amendments 40
28. Successors 40
29. Determinations and Actions by the Board of Directors 40
30. Benefits of this Agreement 41
31. Severability 41
32. Governing Law 41
33. Counterparts 42
34. Descriptive Headings 42
Exhibit A -- Certificate of Designation of
Series A Junior
Participating Cumulative Preferred Stock
Exhibit B -- Form of Right Certificate
<PAGE>
AMENDED AND RESTATED SHAREHOLDER RIGHTS AGREEMENT
Agreement (the "Agreement"), dated as of November 19, 1997, between
Westbank Corporation, a Massachusetts corporation (the "Company"),
and State Street Bank and Trust Company, a Massachusetts trust
company (the "Rights Agent").
W I T N E S S E T H
WHEREAS, the Company and the Rights Agent entered into a Shareholder
Rights Agreement dated as of December 27, 1989 (the "Original Rights
Agreement"), pursuant to which, among other things, the Board of
Directors of the Company authorized and declared a dividend
distribution of one Right (as defined in the Original Rights
Agreement and hereinafter referred to as a "Common Stock Purchase
Right")) per share of Common Stock (as hereinafter defined) of the
Company to holders of outstanding shares of Common Stock; and
WHEREAS, the Board of Directors of the Company desires to provide
shareholders of the Company with the opportunity to benefit from the
long-term prospects and value of the Company and to ensure that
shareholders of the Company receive fair and equal treatment in the
event of any proposed takeover of the Company; and
WHEREAS, the Board of Directors of the Company has determined that
it is in the best interests of the shareholders of the Company to
amend and restate the Original Rights Agreement in its entirety to,
among other things, cancel the Common Stock Purchase Rights issued
pursuant to the Original Rights Agreement and provide for the
issuance of preferred stock purchase rights to the stockholders of
the Company in accordance with this Agreement; and
WHEREAS, on November 19, 1997, the Board of Directors of the Company
authorized and declared a dividend distribution of one Right (as
such term is hereinafter defined) for each outstanding share of
Common Stock of the Company outstanding as of the close of business
on December 4, 1997 (the "Record Date"), and contemplates the
issuance of one Right for each share of Common Stock of the Company
issued (whether originally issued or sold from the Company's
treasury, except in the case of treasury shares having associated
Rights) between the Record Date and the earlier of the Distribution
Date or the Expiration Date (as such terms are hereinafter defined),
each Right initially representing the right to purchase one
ten-thousandth of a share of Series A Junior Participating
Cumulative Preferred Stock of the Company having the rights, powers
and preferences set forth on Exhibit A hereto, upon the terms and
subject to the conditions hereinafter set forth (the "Rights"); and
WHEREAS, the Company desires to appoint the Rights Agent to act as
rights agent hereunder, in accordance with the terms and conditions
hereof;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
<PAGE>
Section 1. Certain Definitions. For purposes of this Agreement, the
following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as 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, shall be the Beneficial Owner (as such term
is hereinafter defined) of 15% or more of the shares of Common Stock
of the Company then outstanding, but shall not include (i) the
Company, (ii) any Subsidiary (as such term is hereinafter defined)
of the Company, (iii) any employee benefit plan or compensation
arrangement of the Company or any Subsidiary of the Company or (iv)
any Person holding shares of Common Stock of the Company organized,
appointed or established by the Company or any Subsidiary of the
Company for or pursuant to the terms of any such employee benefit
plan or compensation arrangement (the Persons described in clauses
(i) through (iv) above are referred to herein as "Exempt Persons").
Notwithstanding the foregoing, no Person shall become an "Acquiring
Person" as the result of an acquisition of the Company's Common
Stock by the Company which, by reducing the number of shares
outstanding, increases the proportionate number of shares
beneficially owned by such Person to 15% or more of the shares of
Common Stock of the Company then outstanding; provided, however,
that if a Person shall become the Beneficial Owner of 15% or more of
the shares of Common Stock of the Company then outstanding by reason
of share purchases by the Company and shall, after such share
purchases by the Company, become the Beneficial Owner of any
additional shares (other than pursuant to a stock split, stock
dividend or similar transaction) of Common Stock of the Company and
immediately thereafter be the Beneficial Owner of 15% or more of the
shares of Common Stock of the Company then outstanding, then such
Person shall be deemed to be an "Acquiring Person."
In addition, notwithstanding the foregoing, a Person shall not be an
"Acquiring Person" if the Board of Directors of the Company
determines that a Person who would otherwise be an "Acquiring
Person," as defined pursuant to the foregoing provisions of this
Section 1(a), has become such inadvertently, and such Person divests
as promptly as practicable (or within such period of time as the
Board of Directors determines is reasonable) a sufficient number of
shares of Common Stock of the Company so that such Person would no
longer be an "Acquiring Person," as defined pursuant to the
foregoing provisions of this Section 1(a).
(b) "Adjustment Shares" shall have the meaning set forth in Section
11(a)(iii) hereof.
(c) "Adverse Person" shall mean any Person declared to be an Adverse
Person by the Board of Directors upon a determination of the Board
of Directors that the criteria set forth in Section 11(a)(ii)(B)
apply to such Person.
(d) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and
<PAGE>
Regulations (the "Rules") under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), as in effect on the date of this
Agreement; provided, however, that no Person who is a director or
officer of the Company shall be deemed an Affiliate or an Associate
of any other director or officer of the Company solely as a result
of his or her position as director or officer of the Company.
(e) A Person shall be deemed the "Beneficial Owner" of, and shall be
deemed to "beneficially own," any securities:
(i) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, beneficially owns (as determined
pursuant to Rule 13d-3 of the Rules under the Exchange Act, as in
effect on the date of this Agreement);
(ii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has:
(A) the right to acquire (whether such right is exercisable
immediately or only after the passage of time or upon the
satisfaction of any conditions or both) pursuant to any agreement,
arrangement or understanding (whether or not in writing) (other than
customary agreements with and between underwriters and selling group
members with respect to a bona fide public offering of securities)
or upon the exercise of conversion rights, exchange rights, rights
(other than the Rights), warrants or options, or otherwise;
provided, however, that a Person shall not be deemed the "Beneficial
Owner" of, or to "beneficially own," (1) securities tendered
pursuant to a tender or exchange offer made by or on behalf of such
Person or any of such Person's Affiliates or Associates until such
tendered securities are accepted for purchase or exchange; (2)
securities issuable upon exercise of these Rights at any time prior
to the occurrence of a Triggering Event; or (3) securities issuable
upon exercise of Rights from and after the occurrence of a
Triggering Event, which Rights were acquired by such Person or any
of such Person's Affiliates or Associates prior to the Distribution
Date or pursuant to Sections 3(a), 11(i) or 22 hereof; or
(B) the right to vote pursuant to any agreement, arrangement or
understanding (whether or not in writing); provided, however, that a
Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially own," any security under this clause (B) if the
agreement, arrangement or understanding to vote such security (1)
arises solely from a revocable proxy given in response to a public
proxy or consent solicitation made pursuant to, and in accordance
with, the Rules of the Exchange Act and (2) is not also then
reportable by such person on Schedule 13D under the Exchange Act (or
any comparable or successor report); or
<PAGE>
(C) the right to dispose of pursuant to any agreement, arrangement
or understanding (whether or not in writing) (other than customary
arrangements with and between underwriters and selling group members
with respect to a bona fide public offering of securities); or
(iii) which are beneficially owned, directly or indirectly, by any
other Person (or any Affiliate or Associate thereof) with which such
Person or any of such Person's Affiliates or Associates has any
agreement, arrangement or understanding (whether or not in writing)
(other than customary agreements with and between underwriters and
selling group members with respect to a bona fide public offering of
securities) for the purpose of acquiring, holding, voting (except
pursuant to a revocable proxy as described in clause (B) of Section
1(d)(ii) hereof) or disposing of any securities of the Company;
provided, however, that (1) no Person engaged in business as an
underwriter of securities shall be deemed the Beneficial Owner of
any securities acquired through such Person's participation as an
underwriter in good faith in a firm commitment underwriting until
the expiration of forty (40) days after the date of such
acquisition, and (2) no Person who is a director or an officer of
the Company shall be deemed, as a result of his or her position as
director or officer of the Company, the Beneficial Owner of any
securities of the Company that are beneficially owned by any other
director or officer of the Company.
(f) "Business Day" shall mean any day other than a Saturday, Sunday,
or a day on which banking institutions in the State of Massachusetts
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.,
Boston, Massachusetts time, on such date; provided, however, that if
such date is not a Business Day it shall mean 5:00 P.M., Boston,
Massachusetts time, on the next succeeding Business Day.
(h) "Common Stock" when used in reference to the Company shall mean
the common stock, par value $2.00 per share, of the Company or any
other shares of capital stock of the Company into which such stock
shall be reclassified or changed. "Common Stock" when used with
reference to any Person other than the Company organized in
corporate form shall mean (i) the capital stock or other equity
interest of such Person with the greatest voting power, (ii) the
equity securities or other equity interest having power to control
or direct the management of such Person or (iii) if such Person is a
Subsidiary of another Person, the Person or Persons which ultimately
control such first-mentioned Person and which have issued any such
outstanding capital stock, equity securities or equity interest.
"Common Stock" when used with reference to any Person not organized
in corporate form shall mean units of beneficial interest which
shall be entitled to exercise the greatest voting power of such
Person or, in the case of a limited partnership, shall have the
power to remove or otherwise replace the general partner or
partners.
<PAGE>
(i) "Current Value" shall have the meaning set forth in Section
11(a)(iii) hereof.
(j) "Depositary Agent" shall have the meaning set forth in Section
7(c) hereof.
(k) "Distribution Date" shall have the meaning defined in Section
3(a) hereof.
(l) "Exercise Price" shall have the meaning defined in Section 4(a)
hereof.
(m) "Expiration Date" and "Final Expiration Date" shall have the
meanings set forth in Section 7(a) hereof.
(n) "Fair Market Value" of any securities or other property shall be
as determined in accordance with Section 11(d) hereof.
(o) "Group" shall have the meaning set forth in clause (b) of the
definition of "Person."
(p) "Person" shall mean (a) an individual, a corporation, a
partnership, an association, a joint stock company, a trust, a
business trust, a government or political subdivision, any
unincorporated organization, or any other association or entity, or
(b) a "group" as that term is used for purposes of Section 13(d)(3)
of the Securities Exchange Act of 1934, as amended (any such group
under this Clause (b), a "Group").
(q) "Preferred Stock" shall mean shares of Series B Junior
Participating Cumulative Preferred Stock, par value $5.00 per share,
of the Company having the rights and preferences set forth in the
form of Certificate of Designation attached hereto as Exhibit A.
(r) "Preferred Stock Equivalents" shall have the meaning set forth
in Section 11(b) hereof.
(s) "Principal Party" shall have the meaning defined in Section
13(b) hereof.
(t) "Redemption Price" shall have the meaning defined in Section 23
hereof.
(u) "Registered Common Stock" shall have the meaning set forth in
Section 13(b) hereof.
(v) "Right Certificate" shall have the meaning set forth in Section
3(a) hereof.
<PAGE>
(w) "Section 11(a)(ii) Event" shall mean any event described in
Section 11(a)(ii) hereof.
(x) "Section 11(a)(ii) Trigger Date" shall have the meaning set
forth in Section 11(a)(ii) hereof.
(y) "Section 13 Event" shall mean any event described in clauses
(x), (y) or (z) of Section 13(a) hereof.
(z) "Section 24(a)(i) Exchange Ratio" shall have the meaning set
forth in Section 24(a)(i) hereof.
(aa) "Section 24(a)(ii) Exchange Ratio" shall have the meaning set
forth in Section 24(a)(ii) hereof.
(bb) "Spread" shall have then meaning set forth in Section
11(a)(iii) hereof.
(cc) "Stock Acquisition Date" shall mean the date of the first
public announcement (which for purposes of this definition shall
include, without limitation, the issuance of a press release or the
filing of a publicly-available report or other document with the
Securities and Exchange Commission or any other governmental agency)
by the Company or an Acquiring Person that an Acquiring Person has
become such.
(dd) "Subsidiary" shall mean, with reference to any Person, any
corporation or other entity of which securities or other ownership
interest having ordinary voting power sufficient, in the absence of
contingencies, to elect a majority of the board of directors or
other persons performing similar functions of such corporation or
other entity are at the time directly or indirectly beneficially
owned or otherwise controlled by such Person and any Affiliate of
such Person.
(ee) "Substitution Period" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(ff) "Triggering Event" shall mean any Section 11(a)(ii) Event or
any Section 13 Event.
Section 2. Amendment and Restatement of the Original Rights
Agreement; Appointment of Rights Agent.
(a) The Original Rights Agreement is hereby amended and restated in
its entirety by this Agreement and in connection therewith all
Common Stock Purchase Rights issued pursuant to the Original Rights
Agreement are deemed to be canceled and terminated as of the date
hereof without further action and no holder of any such Common Stock
Purchase Rights shall have any rights whatsoever with respect to
<PAGE>
such Common Stock Purchase Rights, whether under any provision of
this Agreement or otherwise.
(b) The Company hereby appoints the Rights Agent to act as agent for
the Company and the holders of the Rights (who, in accordance with
Section 3 hereof, shall prior to the Distribution Date (as
hereinafter defined in Section 3(a)) also be the holders of the
Common Stock of the Company) in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such
appointment. The Company may from time to time appoint such
Co-Rights Agents as it may deem necessary or desirable. In the
event the Company appoints one or more Co-Rights Agents, the
respective duties of the Rights Agent and any Co-Rights Agents shall
be as the Company shall determine. The Company shall give notice to
the Rights Agent of the appointment of one or more Co-Rights Agents
and the respective duties of the Rights Agent and any such Co-Rights
Agents.
Section 3. Issue of Right Certificates.
(a) From the date hereof until the earlier of (i) the Close of
Business on the tenth calendar day after the Stock Acquisition Date,
(ii) the Close of Business on the tenth Business Day (or such other
calendar day, if any, as the Board of Directors may determine in its
sole discretion) after the date a tender or exchange offer by any
Person, other than an Exempt Person, is first published or sent or
given within the meaning of Rule 14d-4(a) of the Exchange Act, or
any successor rule, if, upon consummation thereof, such Person would
be the Beneficial Owner of 15% or more of the shares of Common Stock
of the Company then outstanding or (iii) the determination by the
Board of Directors of the Company, pursuant to the criteria set
forth in Section 11(a)(ii)(B) hereof, that a Person is an Adverse
Person (including any such date which is after the date of this
Agreement and prior to the issuance of the Rights) (the earlier of
such dates being herein referred to as the "Distribution Date"), (x)
the Rights will be evidenced (subject to the provisions of Section
3(b) hereof) by the certificates for the Common Stock of the Company
registered in the names of the holders of the Common Stock of the
Company (which certificates for Common Stock of the Company shall be
deemed also to be certificates for Rights) and not by separate
certificates, and (y) the Rights will be transferable only in
connection with the transfer of the underlying shares of Common
Stock of the Company. As soon as practicable after the Distribution
Date, the Rights Agent will, at the Company's expense send, by
first-class, insured, postage prepaid mail, to each record holder of
the Common Stock of the Company as of the Close of Business on the
Distribution Date, at the address of such holder shown on the
records of the Company, one or more certificates, in substantially
the form of Exhibit B hereto (the "Right Certificates"), evidencing
one Right for each share of Common Stock of the Company so held,
subject to adjustment as provided herein. In the event that an
adjustment in the number of Rights per share of Common Stock of the
Company has been made pursuant to Section 11(o) hereof, the Company
may make the necessary and appropriate rounding adjustments (in
accordance with Section 14(a) hereof) at the time of distribution of
the Right Certificates, so that Right Certificates representing only
<PAGE>
whole numbers of Rights are distributed and cash is paid in lieu of
any fractional Rights. As of and after the Close of Business on the
Distribution Date, the Rights will be evidenced solely by such Right
Certificates.
(b) With respect to certificates for the Common Stock of the Company
issued prior to the Close of Business on the Record Date, the Rights
will be evidenced by such certificates for the Common Stock of the
Company on or until the Distribution Date (or the earlier
redemption, expiration or termination of the Rights), and the
registered holders of the Common Stock of the Company also shall be
the registered holders of the associated Rights. Until the
Distribution Date (or the earlier redemption, expiration or
termination of the Rights), the transfer of any of the certificates
for the Common Stock of the Company outstanding prior to the date of
this Agreement shall also constitute the transfer of the Rights
associated with the Common Stock of the Company represented by such
certificate.
(c) Certificates for the Common Stock of the Company issued after
the Record Date, but prior to the earlier of the Distribution Date
or the redemption, expiration or termination of the Rights, shall be
deemed also to be certificates for Rights, and shall bear a legend,
substantially in the form set forth below:
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in an Amended and Restated Shareholder
Rights Agreement between Westbank Corporation and State Street Bank
and Trust Company, as Rights Agent, dated as of November 19, 1997,
as amended, restated, renewed or extended from time to time (the
"Rights Agreement"), the terms of which are hereby incorporated
herein by reference and a copy of which is on file at the principal
offices of Westbank Corporation and the stock transfer
administration office of the Rights Agent. Under certain
circumstances, as set forth in the Rights Agreement, such Rights
will be evidenced by separate certificates and will no longer be
evidenced by this certificate. Westbank Corporation may redeem the
Rights at a redemption price of $.001 per Right, subject to
adjustment, under the terms of the Rights Agreement. Westbank
Corporation will mail to the holder of this certificate a copy of
the Rights Agreement, as in effect on the date of mailing, without
charge promptly after receipt of a written request therefor. Under
certain circumstances, Rights issued to or held by Acquiring
Persons, Adverse Persons or any Affiliates or Associates thereof (as
defined in the Rights Agreement), and any subsequent holder of such
Rights, may become null and void. The Rights shall not be
exercisable, and shall be void so long as held, by a holder in any
jurisdiction where the requisite qualification, if any, to the
issuance to such holder, or the exercise by such holder, of the
Rights in such jurisdiction shall not have been obtained or be
<PAGE>
obtainable.
With respect to such certificates containing the foregoing legend,
the Rights associated with the Common Stock of the Company
represented by such certificates shall be evidenced by such
certificates alone until the Distribution Date (or the earlier
redemption, expiration or termination of the Rights), and the
transfer of any of such certificates shall also constitute the
transfer of the Rights associated with the Common Stock of the
Company represented by such certificates. In the event that the
Company purchases or acquires any shares of Common Stock of the
Company after the Record Date but prior to the Distribution Date,
any Rights associated with such Common Stock of the Company shall be
deemed canceled and retired so that the Company shall not be
entitled to exercise any Rights associated with the shares of Common
Stock of the Company which are no longer outstanding. The failure
to print the foregoing legend on any such certificate representing
Common Stock of the Company or any defect therein shall not affect
in any manner whatsoever the application or interpretation of the
provisions of Section 7(e) hereof.
Section 4. Form of Right Certificates.
(a) The Right Certificates (and the forms of election to purchase
shares and of assignment and certificate to be printed on the
reverse thereof) shall each be substantially in the form of Exhibit
B hereto and may have such marks of identification or designation
and such legends, summaries or endorsements printed thereon as the
Company may deem appropriate and as are not inconsistent with the
provisions of this Agreement, or as may be required to comply with
any applicable law, rule or regulation or with any rule or
regulation of any stock exchange on which the Rights may from time
to time be listed, or to conform to customary usage. The Rights
Certificates shall be in a machine printable format and in a form
reasonably satisfactory to the Rights Agent. Subject to the
provisions of Section 11 and Section 22 hereof, the Right
Certificates, whenever distributed, shall be dated as of the Record
Date, shall show the date of countersignature, and on their face
shall entitle the holders thereof to purchase such number of one
ten-thousandths of a share of Preferred Stock as shall be set forth
therein at the price set forth therein (the "Exercise Price"), but
the number of such shares and the Exercise Price shall be subject to
adjustment as provided herein.
(b) Any Right Certificate issued pursuant to Section 3(a) or Section
22 hereof that represents Rights beneficially owned by (i) an
Acquiring Person, an Adverse Person or any Associate or Affiliate of
an Acquiring Person or an Adverse Person, (ii) a transferee of an
Acquiring Person or an Adverse Person (or of any Associate or
Affiliate of an Acquiring Person or an Adverse Person) who becomes a
transferee after the Acquiring Person or Adverse Person becomes
such, or (iii) a transferee of an Acquiring Person or an Adverse
Person (or of any such Associate or Affiliate) who becomes a
transferee prior to or concurrently with the Acquiring Person or
Adverse Person becoming such and receives such Rights pursuant to
either (A) a transfer (whether or not for consideration) from the
Acquiring Person or Adverse Person to holders of equity interests in
such Acquiring Person or Adverse Person or to any Person with whom
the Acquiring Person or Adverse Person has any continuing agreement,
arrangement or understanding (whether or not in writing) regarding
<PAGE>
the transferred Rights, the shares of Common Stock of the Company
associated with such Rights or the Company or (B) a transfer which
the Board of Directors of the Company has determined is part of a
plan, arrangement or understanding which has as a primary purpose or
effect the avoidance of Section 7(e) hereof, and any Right
Certificate issued pursuant to Section 6, Section 11 or Section 22
upon transfer, exchange, replacement or adjustment of any other
Right Certificate referred to in this sentence, shall have deleted
therefrom the second sentence of the existing legend on such Right
Certificate and in substitution therefor shall contain the following
legend:
The Rights represented by this Right Certificate are or were
beneficially owned by a Person who was or became an Acquiring
Person, an Adverse Person or an Affiliate or an Associate of an
Acquiring Person or an Adverse Person (as such terms are defined in
the Rights Agreement). This Right Certificate and the Rights
represented hereby may become null and void under certain
circumstances as specified in Section 7(e) of the Rights Agreement.
The Company shall give notice to the Rights Agent promptly after it
becomes aware of the existence and identity of any Acquiring Person
or Adverse Person or any Associate or Affiliate thereof. The
Company shall instruct the Rights Agent in writing of the Rights
which should be so legended. The failure to print the foregoing
legend on any such Right Certificate or any defect therein shall not
affect in any manner whatsoever the application or interpretation of
the provisions of Section 7(e) hereof.
Section 5. Countersignature and Registration.
(a) The Right Certificates shall be executed on behalf of the
Company by its Chairman of the Board of Directors, or its President
or any Vice President and by its Treasurer or any Assistant
Treasurer, or by its Secretary or any Assistant Secretary, either
manually or by facsimile signature, and shall have affixed thereto
the Company's seal or a facsimile thereof which shall be attested to
by the Secretary or any Assistant Secretary of the Company, either
manually or by facsimile signature. The Right Certificates shall be
manually countersigned by an authorized signatory of the Rights
Agent and shall not be valid for any purpose unless so
countersigned, and such countersignature upon any Right Certificate
shall be conclusive evidence, and the only evidence, that such Right
Certificate has been duly countersigned as required hereunder. In
case any officer of the Company who shall have signed any of the
Right Certificates shall cease to be such officer of the Company
before countersignature by the Rights Agent and issuance and
delivery by the Company, such Right Certificates, nevertheless, may
be countersigned by an authorized signatory of the Rights Agent, and
issued and delivered by the Company with the same force and effect
as though the person who signed such Right Certificates had not
ceased to be such officer of the Company; and any Right Certificates
may be signed on behalf of the Company by any person who, at the
actual date of the execution of such Right Certificate, shall be a
<PAGE>
proper officer of the Company to sign such Right Certificate,
although at the date of the execution of this Rights Agreement any
such person was not such an officer.
(b) Following the Distribution Date, the Rights Agent will keep or
cause to be kept, at one of its offices designated as the
appropriate place for surrender of Right Certificates upon exercise
or transfer, books for registration and transfer of the Right
Certificates issued hereunder. Such books shall show the names and
addresses of the respective holders of the Right Certificates, the
number of Rights evidenced on its face by each of the Right
Certificates and the date of each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates.
(a) Subject to the provisions of Section 4(b), Section 7(e) and
Section 14 hereof, at any time after the Close of Business on the
Distribution Date, and at or prior to the Close of Business on the
Expiration Date, any Right Certificate or Certificates may be
transferred, split up, combined or exchanged for another Right
Certificate or Certificates, entitling the registered holder to
purchase a like number of one ten-thousandths of a share of
Preferred Stock (or following a Triggering Event, preferred stock,
cash, property, debt securities, Common Stock of the Company or any
combination thereof) as the Right Certificate or Certificates
surrendered then entitled such holder to purchase and at the same
Exercise Price. Any registered holder desiring to transfer, split
up, combine or exchange any Right Certificate shall make such
request in writing delivered to the Rights Agent, and shall
surrender the Right Certificate or Certificates to be transferred,
split up, combined or exchanged, with the form of assignment and
certificate duly executed, at the office or offices of the Rights
Agent designated for such purpose. Neither the Rights Agent nor the
Company shall be obligated to take any action whatsoever with
respect to the transfer of any such surrendered Right Certificate
until the registered holder shall have completed and signed the
certificate contained in the form of assignment on the reverse side
of such Right Certificate and shall have provided such additional
evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company
shall reasonably request. Thereupon the Rights Agent shall, subject
to Section 4(b), Section 7(e) and Section 14 hereof, countersign and
deliver to the Person entitled thereto a Right Certificate or
Certificates, as the case may be, as so requested. The Company may
require payment by the registered holder of a Right Certificate, of
a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer, split up, combination or
exchange of Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of loss, theft or
destruction, of indemnity or security satisfactory to them, and
reimbursement to the Company and the Rights Agent of all reasonable
expenses incidental thereto, and upon surrender to the Rights Agent
and cancellation of the Right Certificate, if mutilated, the Company
<PAGE>
will execute and deliver a new Right Certificate of like tenor to
the Rights Agent for countersignature and delivery to the registered
owner in lieu of the Right Certificate so lost, stolen, destroyed or
mutilated.
Section 7. Exercise of Rights; Exercise Price; Expiration Date of
Rights.
(a) Subject to Section 7(e) hereof, the registered holder of any
Right Certificate may exercise the Rights evidenced thereby (except
as otherwise provided herein) in whole or in part at any time after
the Distribution Date upon surrender of the Right Certificate, with
the form of election to purchase and the certificate on the reverse
side thereof duly executed, to the Rights Agent at the office or
offices of the Rights Agent designated for such purpose, together
with payment of the aggregate Exercise Price for the total number of
one ten-thousandths of a share of Preferred Stock (or other
securities, cash or other assets, as the case may be) as to which
such surrendered Rights are then exercised, at or prior to the
earlier of (i) the Close of Business on the tenth anniversary of the
date of this Agreement (the "Final Expiration Date"), (ii) the time
at which the Rights are redeemed as provided in Section 23 hereof or
(iii) the time at which such Rights are exchanged as provided in
Section 24 hereof (the earlier of (i), (ii) or (iii) being herein
referred to as the "Expiration Date"). Except as set forth in
Section 7(e) hereof and notwithstanding any other provision of this
Agreement, any Person who prior to the Distribution Date becomes a
record holder of shares of Common Stock of the Company may exercise
all of the rights of a registered holder of a Right Certificate with
respect to the Rights associated with such shares of Common Stock of
the Company in accordance with the provisions of this Agreement, as
of the date such Person becomes a record holder of shares of Common
Stock of the Company.
(b) The Exercise Price for each one ten-thousandth of a share of
Preferred Stock pursuant to the exercise of a Right shall initially
be sixty dollars ($60.00), shall be subject to adjustment from time
to time as provided in Section 11 and Section 13 hereof and shall be
payable in lawful money of the United States of America in
accordance with Section 7(c) below.
(c) As promptly as practicable following the Distribution Date, the
Company shall deposit with a corporation, trust, bank or similar
institution in good standing organized under the laws of the United
States or any State of the United States, which is authorized under
such laws to exercise corporate trust or stock transfer powers and
is subject to supervision or examination by a federal or state
authority (such institution is hereinafter referred to as the
"Depositary Agent"), certificates representing the shares of
Preferred Stock that may be acquired upon exercise of the Rights and
the Company shall cause such Depositary Agent to enter into an
agreement pursuant to which the Depositary Agent shall issue
receipts representing interests in the shares of Preferred Stock so
deposited. Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase and the
certificate on the reverse side thereof duly executed, accompanied
by payment of the Exercise Price for the shares to be purchased and
an amount equal to any applicable transfer tax (as determined by the
Rights Agent) in cash, or by certified check or bank draft payable
<PAGE>
to the order of the Company, the Rights Agent shall, subject to
Section 20(k) hereof, thereupon promptly (i) requisition from the
Depositary Agent (or make available, if the Rights Agent is the
Depositary Agent) depositary receipts or certificates for the number
of one ten-thousandths of a share of Preferred Stock to be purchased
and the Company hereby irrevocably authorizes the Depositary Agent
to comply with all such requests, (ii) when appropriate, requisition
from the Company the amount of cash, if any, to be paid in lieu of
issuance of fractional shares in accordance with Section 14 hereof,
(iii) promptly after receipt of such certificates or depositary
receipts, cause the same to be delivered to or upon the order of the
registered holder of such Right Certificate, registered in such name
or names as may be designated by such holder and (iv) when
appropriate, after receipt promptly deliver such cash to or upon the
order of the registered holder of such Right Certificate. In the
event that the Company is obligated to issue other securities
(including Common Stock) of the Company, pay cash or distribute
other property pursuant to Section 11(a) hereof, the Company will
make all arrangements necessary so that such other securities, cash
or other property are available for distribution by the Rights
Agent, if and when appropriate. The payment of the Exercise Price
may be made in cash or by certified or bank check payable to the
order of the Company, or by wire transfer of immediately available
funds to the account of the Company (provided that notice of such
wire transfer shall be given by the holder of the related Right to
the Rights Agent).
(d) In case the registered holder of any Right Certificate shall
exercise less than all the Rights evidenced thereby, a new Right
Certificate evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent and delivered to the
registered holder of such Right Certificate or to his duly
authorized assigns, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the contrary, from
and after the first occurrence of a Section 11(a)(ii) Event or
Section 13 Event, any Rights beneficially owned by (i) an Acquiring
Person, an Adverse Person or any Associate or Affiliate of an
Acquiring Person or an Adverse Person, (ii) a transferee of an
Acquiring Person or an Adverse Person (or of any Associate or
Affiliate of an Acquiring Person or an Adverse Person) who becomes a
transferee after the Acquiring Person or Adverse Person becomes such
or (iii) a transferee of an Acquiring Person or an Adverse Person
(or of any Associate or Affiliate of an Acquiring Person or an
Adverse Person) who becomes a transferee prior to or concurrently
with the Acquiring Person or Adverse Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or
not for consideration) from the Acquiring Person or Adverse Person
to holders of equity interests in such Acquiring Person or Adverse
Person or to any Person with whom the Acquiring Person or Adverse
Person has any continuing agreement, arrangement or understanding
regarding the transferred Rights, the shares of Common Stock of the
Company associated with such Rights or the Company, or (B) a
transfer which the Board of Directors of the Company has determined
is part of a plan, arrangement or understanding which has as a
primary purpose or effect the avoidance of this Section 7(e), shall
be null and void without any further action and no holder of such
<PAGE>
Rights shall have any rights whatsoever with respect to such Rights,
whether under any provision of this Agreement or otherwise. The
Company shall use all reasonable efforts to ensure that the
provisions of this Section 7(e) and Section 4(b) hereof are complied
with, but shall have no liability to any holder of Right
Certificates or other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or Adverse Person
or any Affiliates or Associates of an Acquiring Person or an Adverse
Person or any transferee of any of them hereunder.
(f) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder of Rights
upon the occurrence of any purported exercise as set forth in this
Section 7 unless such registered holder shall have (i) completed and
signed the certificate contained in the form of election to purchase
set forth on the reverse side of the Right Certificate surrendered
for such exercise, and (ii) provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably
request.
Section 8. Cancellation and Destruction of Right Certificates. All
Right Certificates surrendered for the purpose of exercise,
transfer, split up, combination or exchange shall, if surrendered to
the Company or 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 Right Certificates
shall be issued in lieu thereof except as expressly permitted by any
of the provisions of this Agreement. The Company shall deliver to
the Rights Agent for cancellation and retirement, and the Rights
Agent shall so cancel and retire, any other Right Certificate
purchased or acquired by the Company otherwise than upon the
exercise thereof. The Rights Agent shall deliver all canceled Right
Certificates to the Company.
Section 9. Reservation and Availability of Preferred Stock.
(a) The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued
shares of Preferred Stock or any authorized and issued shares of
Preferred Stock held in its treasury, the number of shares of
Preferred Stock that will be sufficient to permit the exercise in
full of all outstanding and exercisable Rights. Upon the occurrence
of any events resulting in an increase in the aggregate number of
shares of Preferred Stock issuable upon exercise of all outstanding
Rights in excess of the number then reserved, the Company shall make
appropriate increases in the number of shares so reserved.
(b) The Company 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 to be listed, upon official
notice of issuance, upon the principal national securities exchange,
if any, upon which the Common Stock of the Company is listed or, if
the principal market for the Common Stock of the Company is not on
any national securities exchange, to be eligible for quotation on
the National Association of Securities Dealers Automated Quotation
System ("NASDAQ") or any successor thereto or other comparable
quotation system.
<PAGE>
(c) The Company shall use its best efforts to (i) file, as soon as
practicable following the earliest date after the occurrence of a
Section 11(a)(ii) Event on which the consideration to be delivered
by the Company upon exercise of the Rights has been determined in
accordance with Section 11(a)(iii) hereof, or as soon as required by
law following the Distribution Date, as the case may be, a
registration statement under the Securities Act of 1933, as amended
(the "Securities Act"), with respect to the securities purchasable
upon exercise of the Rights on an appropriate form, (ii) cause such
registration statement to become effective as soon as practicable
after such filing and (iii) cause such registration statement to
remain effective (with a prospectus that at all times meets the
requirements of the Securities Act) until the earlier of (A) the
date as of which the Rights are no longer exercisable for such
securities or (B) the Expiration Date. The Company will also take
such action as may be appropriate under, and which will ensure
compliance with, the securities or "blue sky" laws of the various
states in connection with the exercisability of the Rights. The
Company may temporarily suspend, for a period of time not to exceed
ninety (90) days after the date determined in accordance with the
provisions of the first sentence of this Section 9(c), the
exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective. Upon such
suspension, the Company shall issue a public announcement stating
that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the
suspension is no longer in effect, in each case with prompt written
notice to the Rights Agent. Notwithstanding any such 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.
(d) The Company covenants and agrees that it will take all such
action as may be necessary to ensure that all shares of Preferred
Stock delivered upon the exercise of the Rights shall, at the time
of delivery of the certificates or depositary receipts for such
shares (subject to payment of the Exercise Price), be duly and
validly authorized and issued and fully paid and nonassessable.
(e) The Company further covenants and agrees that it will pay when
due and payable any and all federal and state transfer taxes and
charges which may be payable in respect of the issuance or delivery
of the Right Certificates or of any certificates for shares of
Preferred Stock upon the exercise of Rights. The Company shall not,
however, be required to pay any transfer tax which may be payable in
respect of any transfer or delivery of Right Certificates to a
person other than, or in respect of the issuance or delivery of
securities in a name other than that of, the registered holder of
the Right Certificates evidencing Rights surrendered for exercise or
to issue or deliver any certificates for securities in a name other
than that of the registered holder upon the exercise of any Rights
until such tax shall have been paid (any such tax being payable by
the holder of such Right Certificate at the time of surrender) or
until it has been established to the Company's satisfaction that no
such tax is due.
Section 10. Preferred Stock Record Date. Each Person in whose name
any certificate for Preferred Stock (including any fraction of a
share of Preferred Stock) is issued upon the exercise of Rights
shall for all purposes be deemed to have become the holder of record
<PAGE>
of the shares of Preferred Stock represented thereby on, and such
certificate shall be dated, the date upon which the Right
Certificate evidencing such Rights was duly surrendered and payment
of the 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 Company
are closed, such person shall be deemed to have become the record
holder of such shares on, and such certificate shall be dated, the
next succeeding Business Day on which the Preferred Stock transfer
books of the Company are open; and further provided, however, that
if delivery of shares of Preferred Stock is delayed pursuant to
Section 9(c), such Person shall be deemed to have become the record
holder of such shares of Preferred Stock only when such shares first
become deliverable. Prior to the exercise of the Right evidenced
thereby, the holder of a Right Certificate shall not be entitled to
any rights of a shareholder of the Company with respect to shares
for which the Rights shall be exercisable, including, without
limitation, the right to vote, to receive dividends or other
distributions or to exercise any preemptive rights, and shall not be
entitled to receive any notice of any proceedings of the Company,
except as provided herein.
Section 11. Adjustment of Exercise Price, Number and Kind of Shares
or Number of Rights. The Exercise Price, the number and kind of
shares covered by each Right and the number of Rights outstanding
are subject to adjustment from time to time as provided in this
Section 11.
(a) (i) In the event the Company shall at any time after the date of
this Agreement (A) declare a dividend on the Preferred Stock payable
in shares of Preferred Stock, (B) subdivide the outstanding
Preferred Stock, (C) combine the outstanding Preferred Stock into a
smaller number of shares or (D) issue any shares of its capital
stock in a reclassification of the Preferred Stock (including any
such reclassification in connection with a consolidation or merger
in which the Company is the continuing or surviving corporation),
except as otherwise provided in this Section 11(a) and Section 7(e)
hereof, the Exercise Price in effect at the time of the record date
for such dividend or of the effective date of such subdivision,
combination or reclassification, and the number and kind of shares
of capital stock issuable on such date, shall be proportionately
adjusted so that the holder of any Right exercised after such time
shall be entitled to receive the aggregate number and kind of shares
of capital stock which, if such Right had been exercised immediately
prior to such date and at a time when the Preferred Stock transfer
books of the Company were open, such holder would have owned upon
such exercise and been entitled to receive by virtue of such
dividend, subdivision, combination or reclassification; provided,
however, that in no event shall the consideration to be paid upon
the exercise of a Right be less than the aggregate par value of the
shares of capital stock of the Company issuable upon exercise of a
Right. If an event occurs which would require an adjustment under
both Section 11(a)(i) and Section 11(a)(ii) hereof, the adjustment
provided for in this Section 11(a)(i) shall be in addition to, and
shall be made prior to, any adjustment required pursuant to Section
11(a)(ii) hereof.
(ii) Subject to the provisions of Section 24 hereof, in the
event
<PAGE>
(A) any Person, alone or together with its Affiliates and
Associates, shall become an Acquiring Person, or
(B) the Board of Directors of the Company, by majority vote, shall
declare any Person to be an Adverse Person, after (x) a
determination that such Person, alone or together with its
Affiliates and Associates, has become the Beneficial Owner of 10% or
more of the outstanding shares of Common Stock of the Company and
(y) a determination by the Board of Directors, after reasonable
inquiry and investigation, including such consultation, if any, with
such persons as such directors shall deem appropriate, that (a) such
Beneficial Ownership by such Person is intended to cause, is
reasonably likely to cause or will cause the Company to repurchase
the Common Stock of the Company beneficially owned by such Person or
to cause pressure on the Company to take action or enter into a
transaction or series of transactions which would provide such
Person with short-term financial gain under circumstances where the
Board of Directors determines that the best long-term interests of
the Company and its shareholders, but for the actions and possible
actions of such Person, would not be served by taking such action or
entering into such transactions or series of transactions at that
time or (b) such Beneficial Ownership is causing or reasonably
likely to cause a material adverse impact (including, but not
limited to, impairment of relationships with customers or impairment
of the Company's ability to maintain its competitive position) on
the business or prospects of the Company. No delay or failure by
the Board of Directors to declare a Person to be an Adverse Person
shall in any way waive or otherwise affect the power of the Board of
Directors subsequently to declare a Person to be an Adverse Person.
In the event that the Board of Directors should at any time
determine, upon reasonable inquiry and investigation, including
consultation with such Persons as the Board of Directors shall deem
appropriate, that such Person has not met or complied with any
condition specified by the Board of Directors, the Board of
Directors may at any time thereafter declare such Person to be an
Adverse Person pursuant to the provisions of this Section
11(a)(ii)(B),
then, and in each such case, promptly following any such occurrence,
proper provision shall be made so that each holder of a Right,
except as provided in Section 7(e) hereof, shall thereafter have a
right to receive, upon exercise thereof at the then current Exercise
Price in accordance with the terms of this Agreement, such number of
shares of Preferred Stock of the Company as shall equal the result
obtained by (x) multiplying the then current Exercise Price by the
then number of one ten-thousandths of a share of Preferred Stock for
which a Right was exercisable immediately prior to the first
occurrence of a Section 11(a)(ii) Event, whether or not such Right
was then exercisable, and dividing that product by (y) 50% of the
Fair Market Value per one ten-thousandth of a share of the Preferred
Stock (determined pursuant to Section 11(d)) on the date of the
occurrence of a Section 11(a)(ii) Event (such number of shares being
referred to as the "Adjustment Shares").
<PAGE>
(iii) In lieu of issuing any shares of Preferred Stock in accordance
with Section 11(a)(ii) hereof, the Company, acting by or pursuant to
resolution of the Board of Directors, may, and in the event that the
number of shares of Preferred Stock which are authorized by the
Company's Articles of Organization but not outstanding or reserved
for issuance for purposes other than upon exercise of the Rights is
not sufficient to permit the exercise in full of the Rights in
accordance with the foregoing subparagraph (ii) of this Section
11(a), the Company, acting by or pursuant to resolution of the Board
of Directors, shall: (A) determine the excess of (X) the Fair Market
Value of the Adjustment Shares issuable upon the exercise of a Right
(the "Current Value") over (Y) the Exercise Price attributable to
each Right (such excess being referred to as the "Spread") and (B)
with respect to all or a portion of each Right (subject to Section
7(e) hereof), make adequate provision to substitute for the
Adjustment Shares, upon payment of the applicable Exercise Price,
(1) cash, (2) a reduction in the Exercise Price, (3) Preferred Stock
Equivalents which the Board of Directors has deemed to have the same
value as shares of Common Stock of the Company, (4) debt securities
of the Company, (5) other assets of the Company or (6) any
combination of the foregoing which, when added to any shares of
Preferred Stock issued upon such exercise, has an aggregate value
equal to the Current Value, where such aggregate value has been
determined by the Board of Directors based upon the advice of a
nationally recognized investment banking firm selected by the Board
of Directors; provided, however, that if the Company shall not have
made adequate provision to deliver value pursuant to clause (B)
above within thirty (30) days following the later of (x) the first
occurrence of a Section 11(a)(ii) Event and (y) the date on which
the Company's right of redemption pursuant to Section 23(a) expires
(the later of (x) and (y) being referred to herein as the "Section
11(a)(ii) Trigger Date"), then the Company shall be obligated to
deliver, upon the surrender for exercise of a Right and without
requiring payment of the Exercise Price, shares of Preferred Stock
(to the extent available) and then, if necessary, cash, which shares
and/or cash have an aggregate value equal to the Spread. If the
Board of Directors shall determine in good faith that it is likely
that sufficient additional shares of Preferred Stock could be
authorized for issuance upon exercise in full of the Rights, the
30-day period set forth above may be extended to the extent
necessary, but not more than ninety (90) days after the Section
11(a)(ii) Trigger Date, in order that the Company may seek
stockholder approval for the authorization of such additional shares
(such period, as it may be extended, being referred to herein as the
"Substitution Period"). To the extent that the Company determines
that some action need be taken pursuant to the first and/or second
sentences of this Section 11(a)(iii), the Company (x) shall provide,
subject to Section 7(e) hereof, that such action shall apply
uniformly to all outstanding Rights and (y) may suspend the
exercisability of the Rights until the expiration of the
Substitution Period in order to seek any authorization of additional
shares and/or to decide the appropriate form of distribution to be
<PAGE>
made pursuant to such first sentence and to determine the value
thereof. In the event of any such suspension, the Company shall
issue a public announcement stating that the exercisability of the
Rights has been temporarily suspended and a public announcement at
such time as the suspension is no longer in effect. For purposes of
this Section 11(a)(iii), the value of the Preferred Stock shall be
the Fair Market Value (as determined pursuant to Section 11(d)
hereof) per share of the Preferred Stock on the Section 11(a)(ii)
Trigger Date and the value of any Preferred Stock Equivalent shall
be deemed to have the same value as the Preferred Stock on such
date.
(b) If the Company shall fix a record date for the issuance of
rights, options or warrants to all holders of Preferred Stock
entitling them (for a period expiring within forty-five (45)
calendar days after such record date) to subscribe for or purchase
Preferred Stock (or securities having the same or more favorable
rights, privileges and preferences as the shares of Preferred Stock
("Preferred Stock Equivalents")) or securities convertible into
Preferred Stock or Preferred Stock Equivalents at a price per share
of Preferred Stock or per share of Preferred Stock Equivalents (or
having a conversion price per share, if a security convertible into
Preferred Stock or Preferred Stock Equivalents) less than the Fair
Market Value (as determined pursuant to Section 11(d) hereof) per
share of Preferred Stock on such record date, the Exercise Price to
be in effect after such record date shall be determined by
multiplying the Exercise Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the
number of shares of Preferred Stock outstanding on such record date,
plus the number of shares of Preferred Stock which the aggregate
offering price of the total number of shares of Preferred Stock
and/or Preferred Stock Equivalents to be offered (and the aggregate
initial conversion price of the convertible securities so to be
offered) would purchase at such Fair Market Value and the
denominator of which shall be the number of shares of Preferred
Stock outstanding on such record date, plus the number of additional
shares of Preferred Stock and Preferred Stock Equivalents to be
offered for subscription or purchase (or into which the convertible
securities so to be offered are initially convertible); provided,
however, that in no event shall the consideration to be paid upon
the exercise of a Right be less than the aggregate par value of the
shares of capital stock of the Company issuable upon exercise of a
Right. In case such subscription price may be paid in a
consideration part or all of which shall be in a form other than
cash, the value of such consideration shall be the Fair Market Value
thereof determined in accordance with Section 11(d) hereof. Shares
of Preferred Stock owned by or held for the account of the Company
shall not be deemed outstanding for the purpose of any such
computation. Such adjustments shall be made successively whenever
such a record date is fixed; and in the event that such rights or
warrants are not so issued, the Exercise Price shall be adjusted to
be the Exercise Price which would then be in effect if such record
date had not been fixed.
(c) If the Company shall fix a record date for the making of a
distribution to all holders of Preferred Stock (including any such
distribution made in connection with a consolidation or merger in
which the Company is the continuing or surviving corporation), of
<PAGE>
evidences of indebtedness, cash (other than a regular periodic cash
dividend out of the earnings or retained earnings of the Company),
assets (other than a dividend payable in Preferred Stock, but
including any dividend payable in stock other than Preferred Stock)
or convertible securities, subscription rights or warrants
(excluding those referred to in Section 11(b)), the Exercise Price
to be in effect after such record date shall be determined by
multiplying the Exercise Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the Fair
Market Value (as determined pursuant to Section 11(d) hereof) per
one ten-thousandth of a share of Preferred Stock on such record
date, less the Fair Market Value (as determined pursuant to Section
11(d) hereof) of the portion of the cash, assets or evidences of
indebtedness so to be distributed or of such convertible securities,
subscription rights or warrants applicable to one ten-thousandth of
a share of Preferred Stock and the denominator of which shall be the
Fair Market Value (as determined pursuant to Section 11(d) hereof)
per one ten-thousandth of a share of Preferred Stock; provided,
however, that in no event shall the consideration to be paid upon
the exercise of a Right be less than the aggregate par value of the
shares of capital stock of the Company issuable upon exercise of a
Right. Such adjustments shall be made successively whenever such a
record date is fixed; and in the event that such distribution is not
so made, the Exercise Price shall again be adjusted to be the
Exercise Price which would be in effect if such record date had not
been fixed.
(d) For the purpose of this 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 shall be determined as
provided in this Section 11(d).
(i) 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 stock is determined during a period following the
announcement by the issuer of such stock of (x) a dividend or
distribution on such stock payable in shares of such stock or
securities convertible into shares of such stock or (y) any
subdivision, combination or reclassification of such stock, and
prior to the expiration of the 30 Trading Day period after the
ex-dividend date for such dividend or distribution, or the record
date for such subdivision, combination or reclassification, then,
and in each such case, the Fair Market Value shall be properly
adjusted to take into account ex-dividend trading. The closing
price for each day shall be the last sale price, regular way, or, in
case no such sale takes place on such day, the average of the
closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system
with respect to securities listed or admitted to trading on the New
York Stock Exchange or, if the securities are not listed or admitted
to trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange on
which 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 last
quoted high bid and low asked prices) in the over-the-counter
market, as reported by NASDAQ or such other system then in use; or,
if on any such date no bids for such security are quoted by any such
<PAGE>
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 Company. If on
any such date no market maker is making a market in such security,
the Fair Market Value of such security on such date shall be
determined reasonably and with utmost good faith to the holders of
the Rights by the Board of Directors of the Company, provided,
however, that if at the time of such determination there is an
Acquiring Person or an Adverse Person, the Fair Market Value of such
security on such date shall be determined by a nationally recognized
investment banking firm selected by the Board of Directors, which
determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent and the
holders of the Rights. 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.
(ii) 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 security, determined reasonably and with
utmost good faith to the holders of the Rights by the Board of
Directors of the Company; provided, however, that if at the time of
such determination there is an Acquiring Person or an Adverse
Person, the Fair Market Value of such security on such date shall be
determined by a nationally recognized investment banking firm
selected by the Board of Directors, which determination shall be
described in a statement filed with the Rights Agent and shall be
binding on the Rights Agent and the holders of the Rights; provided,
however, that for the purposes of making any adjustment provided for
by Section 11(a)(ii) hereof, the Fair Market Value of a share of
Preferred Stock shall not be less than 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 (as both of such terms
are defined in the Certificate of Designation attached as Exhibit A
hereto) applicable 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.
(iii) In the case of property other than securities, the Fair Market
Value thereof shall be determined reasonably and with utmost good
faith to the holders of Rights by the Board of Directors of the
Company; provided, however, that if at the time of such
determination there is an Acquiring Person or an Adverse Person, the
<PAGE>
Fair Market Value of such property on such date shall be determined
by a nationally recognized investment banking firm selected by the
Board of Directors, which determination shall be described in a
statement filed with the Rights Agent and shall be binding upon the
Rights Agent and the holders of the Rights.
(e) Anything herein to the contrary notwithstanding, no adjustment
in the Exercise Price shall be required unless such adjustment would
require an increase or decrease of at least 1% in the Exercise
Price; provided, however, that any adjustments which by reason of
this Section 11(e) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All
calculations under this Section 11 shall be made to the nearest cent
or to the nearest one-millionth of a share of Common Stock of the
Company or hundred-millionth of a share of Preferred Stock, as the
case may be, or to such other figure as the Board of Directors may
deem appropriate. Notwithstanding the first sentence of this
Section 11(e), any adjustment required by this Section 11 shall be
made no later than the earlier of (i) three (3) years from the date
of the transaction which mandates such adjustment or (ii) the
Expiration Date.
(f) If as a result of any provision of Section 11(a) or Section
13(a) hereof, the holder of any Right thereafter exercised shall
become entitled to receive any shares of capital stock of the
Company other than Preferred Stock, thereafter the number of such
other shares so receivable upon exercise of any Right shall be
subject to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to
the Preferred Stock contained in Section 11(a), (b), (c), (d), (e),
(g) through (k) and (m), inclusive, and the provisions of Sections
7, 9, 10, 13 and 14 hereof with respect to the Preferred Stock shall
apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Exercise Price hereunder shall evidence the
right to purchase, at the adjusted Exercise Price, the number of one
ten-thousandths of a share of Preferred Stock (or other securities
or amount of cash or combination thereof) purchasable from time to
time hereunder upon exercise of the Rights, all subject to further
adjustment as provided herein.
(h) Unless the Company shall have exercised its election as provided
in Section 11(i), upon each adjustment of the Exercise Price as a
result of the calculations made in Section 11(b) and (c), each Right
outstanding immediately prior to the making of such adjustment shall
thereafter evidence the right to purchase, at the adjusted Exercise
Price, that number of one ten-thousandths of a share of Preferred
Stock (calculated to the nearest one hundred-millionth) as the Board
of Directors reasonably determines is appropriate to preserve
economic value of the Rights, including, by way of example, that
number obtained by (i) multiplying (x) the number of one
ten-thousandths of a share of Preferred Stock for which a Right may
be exercisable immediately prior to this adjustment by (y) the
Exercise Price in effect immediately prior to such adjustment of the
Exercise Price and (ii) dividing the product so obtained by the
Exercise Price in effect immediately after such adjustment of the
Exercise Price.
<PAGE>
(i) The Company may elect on or after the date of any adjustment of
the Exercise Price to adjust the number of Rights, in substitution
for any adjustment in the number of shares of Preferred Stock
purchasable upon the exercise of a Right. Each of the Rights
outstanding after the adjustment in the number of Rights shall be
exercisable for the number of one ten-thousandths of a share of
Preferred Stock for which a Right was exercisable immediately prior
to such adjustment. Each Right held of record prior to such
adjustment of the number of Rights shall become that number of
Rights (calculated to the nearest one-millionth) obtained by
dividing the Exercise Price in effect immediately prior to
adjustment of the Exercise Price by the Exercise Price in effect
immediately after adjustment of the Exercise Price. The Company
shall make a public announcement of its election to adjust the
number of Rights, indicating the record date for the adjustment,
and, if known at the time, the amount of the adjustment to be made.
This record date may be the date on which the Exercise Price is
adjusted or any day thereafter, but, if the Right Certificates have
been issued, shall be at least ten (10) days later than the date of
the public announcement. If Right Certificates have been issued,
upon each adjustment of the number of Rights pursuant to this
Section 11(i), the Company shall, as promptly as practicable, cause
to be distributed to holders of record of Right Certificates on such
record date Right Certificates evidencing, subject to Section 14
hereof, the additional Rights to which such holders shall be
entitled as a result of such adjustment, or, at the option of the
Company, shall cause to be distributed to such holders of record in
substitution and replacement for the Right Certificates held by such
holders prior to the date of adjustment, and upon surrender thereof,
if required by the Company, new Right Certificates evidencing all
the Rights to which such holders shall be entitled after such
adjustment. Right Certificates so to be distributed shall be
issued, executed and countersigned in the manner provided for herein
(and may bear, at the option of the Company, the adjusted Exercise
Price) and shall be registered in the names of the holders of record
of Right Certificates on the record date specified in the public
announcement.
(j) Irrespective of any adjustment or change in the Exercise Price
or the number of one ten-thousandths of a share of Preferred Stock
issuable upon the exercise of the Rights, the Right Certificates
theretofore and thereafter issued may continue to express the
Exercise Price per share and the number of shares which were
expressed in the initial Right Certificates issued hereunder without
prejudice to any adjustment or change.
(k) Before taking any action that would cause an adjustment reducing
the Exercise Price below the then stated value, if any, of the
number of one ten-thousandths of a share of Preferred Stock issuable
upon exercise of the Rights, the Company shall take any corporate
action which may, in the opinion of its counsel, be necessary in
order that the Company may validly and legally issue fully paid and
nonassessable shares of Preferred Stock at such adjusted Exercise
Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Exercise Price be made effective as of a record
date for a specified event, the Company may elect to defer until the
occurrence of such event the issuing to the holder of any Right
exercised after such record date the number of one ten-thousandths
<PAGE>
of a share of Preferred Stock or other capital stock or securities
of the Company, if any, issuable upon such exercise over and above
the number of one ten-thousandths of a share of Preferred Stock and
other capital stock or securities of the Company, if any, issuable
upon such exercise on the basis of the Exercise Price in effect
prior to such adjustment; provided, however, that the Company shall
deliver to such holder a due bill or other appropriate instrument
evidencing such holder's right to receive such additional shares
upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the Exercise
Price, in addition to those adjustments expressly required by this
Section 11, as and to the extent that in their good faith judgment a
majority of the Board of Directors shall determine to be advisable
in order that any consolidation or subdivision of the Preferred
Stock, issuance wholly for cash of any shares of Preferred Stock at
less than the Fair Market Value, issuance wholly for cash of shares
of Preferred Stock or securities which by their terms are
convertible into or exchangeable for shares of Preferred Stock,
stock dividends or issuance of rights, options or warrants referred
to hereinabove in this Section 11, hereafter made by the Company to
holders of its Preferred Stock, shall not be taxable to such
shareholders.
(n) The Company covenants and agrees that it shall not, at any time
after the Distribution Date and so long as the Rights have not been
redeemed pursuant to Section 23 hereof or exchanged pursuant to
Section 24 hereof, (i) consolidate with (other than a Subsidiary of
the Company in a transaction that complies with the proviso at the
end of this sentence), (ii) merge with or into, or (iii) sell or
transfer (or permit any Subsidiary to sell or transfer), in one
transaction or a series of related transactions, assets or earning
power aggregating 50% or more of the assets or earning power of the
Company and its Subsidiaries taken as a whole, to any other Person
or Persons (other than the Company and/or any of its Subsidiaries in
one or more transactions each of which complies with the proviso at
the end of this sentence) if (x) at the time of or immediately after
such consolidation, merger or sale there are any rights, warrants or
other instruments outstanding or agreements or arrangements in
effect which would substantially diminish or otherwise eliminate the
benefits intended to be afforded by the Rights, or (y) prior to,
simultaneously with or immediately after such consolidation, merger
or sale the shareholders of a Person who constitutes, or would
constitute, the "Principal Party" for the purposes of Section 13(a)
hereof shall have received a distribution of Rights previously owned
by such Person or any of its Affiliates and Associates; provided,
however, that this Section 11(n) shall not affect the ability of any
Subsidiary of the Company to consolidate with, or merge with or
into, or sell or transfer assets or earning power to, any other
Subsidiary of the Company. The Company further covenants and agrees
that after the Distribution Date it will not, except as permitted by
Section 23 or Section 27 hereof, take (or permit any Subsidiary to
take) any action if at the time such action is taken it is
reasonably foreseeable that such action will substantially diminish
or otherwise eliminate the benefits intended to be afforded by the
Rights.
<PAGE>
(o) Notwithstanding anything in this Agreement to the contrary, in
the event the Company shall at any time after the date of this
Agreement and prior to the Distribution Date (i) declare or pay any
dividend on the outstanding Common Stock of the Company payable in
shares of Common Stock of the Company or (ii) effect a subdivision,
combination or consolidation of the outstanding shares of Common
Stock of the Company (by reclassification or otherwise than by
payment of dividends in shares of Common Stock of the Company) into
a greater or lesser number of shares of Common Stock of the Company,
then in any such case (A) the number of one ten-thousandths of a
share of Preferred Stock purchasable after such event upon proper
exercise of each Right shall be determined by multiplying the number
of one ten-thousandths of a share of Preferred Stock so purchasable
immediately prior to such event by a fraction, the numerator of
which is the number of shares of Common Stock of the Company
outstanding immediately prior to such event and the denominator of
which is the number of shares of Common Stock of the Company
outstanding immediately after such event, and (B) each share of
Common Stock of the Company outstanding immediately after such event
shall have issued with respect to it that number of Rights which
each share of Common Stock of the Company outstanding immediately
prior to such event had issued with respect to it. The adjustments
provided for in this Section 11(o) shall be made successively
whenever such a dividend is declared or paid or such a subdivision,
combination or consolidation is effected.
(p) The exercise of Rights under Section 11(a)(ii) shall only result
in the loss of rights under Section 11(a)(ii) to the extent so
exercised and shall not otherwise affect the rights of holders of
Right Certificates under this Rights Agreement, including rights to
purchase securities of the Principal Party following a Section 13
Event which has occurred or may thereafter occur, as set forth in
Section 13 hereof. Upon exercise of a Right Certificate under
Section 11(a)(ii), the Rights Agent shall return such Right
Certificate duly marked to indicate that such exercise has occurred.
Section 12. Certificate of Adjusted Exercise Price or Number of
Shares. Whenever an adjustment is made as provided in Section 11 or
Section 13 hereof, the Company shall (a) promptly prepare a
certificate setting forth such adjustment and a brief statement of
the facts accounting for such adjustment, (b) promptly file with the
Rights Agent and with each transfer agent for the Preferred Stock
and the Common Stock of the Company a copy of such certificate and
(c) mail a brief summary thereof to each holder of a Right
Certificate in accordance with Section 26 hereof. The Rights Agent
shall be fully protected in relying on any such certificate and on
any adjustment contained therein and shall not be deemed to have
knowledge of any such 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, following the Stock Acquisition Date,
directly or indirectly, (x) the Company shall consolidate with, or
merge with and into, any other Person (other than a Subsidiary of
the Company in a transaction which is not prohibited by Section
11(n) hereof), and the Company shall not be the continuing or
<PAGE>
surviving corporation of such consolidation or merger, (y) any
Person (other than a Subsidiary of the Company in a transaction
which is not prohibited by the proviso at the end of the first
sentence of Section 11(n) hereof) shall consolidate with the
Company, or merge with and into the Company and the Company shall be
the continuing or surviving corporation of such merger and, in
connection with such merger, all or part of the shares of Common
Stock of the Company shall be changed into or exchanged for stock or
other securities of any other Person or cash or any other property,
or (z) the Company shall sell, mortgage or otherwise transfer (or
one or more of its Subsidiaries shall sell, mortgage or otherwise
transfer), in one transaction or a series of related transactions,
assets or earning power aggregating 50% or more of the assets or
earning power of the Company and its Subsidiaries (taken as a whole)
to any other Person or Persons (other than the Company or any
Subsidiary of the Company in one or more transactions, each of which
is not prohibited by the proviso at the end of the first sentence of
Section 11(n) hereof), then, and in each such case, proper provision
shall be made so that: (i) each holder of a Right, except as
provided in Section 7(e) hereof, shall have the right to receive,
upon the exercise thereof at the then current Exercise Price in
accordance with the terms of this Agreement, such number of validly
authorized and issued, fully paid and nonassessable shares of freely
tradeable Common Stock of the Principal Party (as hereinafter
defined in Section 13(b)), free and clear of rights of call or first
refusal, liens, encumbrances, transfer restrictions or other adverse
claims, as shall be equal to the result obtained by (1) multiplying
the then current Exercise Price by the number of one ten-thousandths
of a share of Preferred Stock for which a Right is exercisable
immediately prior to the first occurrence of a Section 13 Event, and
dividing that product by (2) 50% of the Fair Market Value
(determined pursuant to Section 11(d) hereof) per share of the
Common Stock of such Principal Party on the date of consummation of
such consolidation, merger, sale or transfer; (ii) such Principal
Party shall thereafter be liable for, and shall assume, by virtue of
such consolidation, merger, sale, mortgage or transfer, all the
obligations and duties of the Company pursuant to this Agreement;
(iii) the term "Company" shall thereafter be deemed to refer to such
Principal Party, it being specifically intended that the provisions
of Section 11 hereof shall apply to such Principal Party; and (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 to permit exercise of all outstanding Rights in
accordance with this Section 13(a) and the making of payments in
cash and/or other securities in accordance with Section 11(a)(iii)
hereof) in connection with such consummation as may be necessary to
assure that the provisions hereof shall thereafter be applicable, as
nearly as reasonably may be, in relation to its shares of Common
Stock thereafter deliverable upon the exercise of the Rights.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in clause (x) or (y) of
the first sentence of Section 13(a), the Person that is the issuer
of any securities into which shares of Common Stock of the Company
are converted in such merger or consolidation, or, if there is more
than one such issuer, the issuer of Common Stock that has the
highest aggregate Fair Market Value (determined pursuant to Section
11(d)), and if no securities are so issued, the Person that is the
<PAGE>
other party to the merger or consolidation, or, if there is more
than one such Person, the Person the Common Stock of which has the
highest aggregate Fair Market Value (determined pursuant to Section
11(d)); and
(ii) in the case of any transaction described in clause (z) of the
first sentence of Section 13(a), the Person that is the party
receiving the greatest portion of the assets or earning power
transferred pursuant to such transaction or transactions, or, if
each Person that is a party to such transaction or transactions
receives the same portion of the assets or earning power transferred
pursuant to such transaction or transactions or if the Person
receiving the largest portion of the assets or earning power cannot
be determined, whichever Person the Common Stock of which has the
highest aggregate Fair Market Value (determined pursuant to Section
11(d));
provided, however, that in any such case, (1) if the Common Stock of
such Person is not at such time and has not been continuously over
the preceding 12-month period registered under Section 12 of the
Exchange Act ("Registered Common Stock") or such Person is not a
corporation, and such Person is a direct or indirect Subsidiary or
Affiliate of another Person who has Registered Common Stock
outstanding, "Principal Party" shall refer to such other Person; (2)
if the Common Stock of such Person is not Registered Common Stock or
such Person is not a corporation, and such Person is a direct or
indirect Subsidiary of another Person but is not a direct or
indirect Subsidiary of another Person which has Registered Common
Stock outstanding, "Principal Party" shall refer to the ultimate
parent entity of such first-mentioned Person; (3) if the Common
Stock of such Person is not Registered Common Stock or such Person
is not a corporation, and such Person is directly or indirectly
controlled by more than one Person, and one or more of such other
Persons has Registered Common Stock outstanding, "Principal Party"
shall refer to whichever of such other Persons is the issuer of the
Registered Common Stock having the highest aggregate Fair Market
Value (determined pursuant to Section 11(d)); and (4) if the Common
Stock of such Person is not Registered Common Stock or such Person
is not a corporation, and such Person is directly or indirectly
controlled by more than one Person, and none of such other Persons
has Registered Common Stock outstanding, "Principal Party" shall
refer to whichever ultimate parent entity is the corporation having
the greatest stockholders' equity or, if no such ultimate parent
entity is a corporation, "Principal Party" shall refer to whichever
ultimate parent entity is the entity having the greatest net assets.
(c) The Company shall not consummate any such consolidation, merger,
sale or transfer unless prior thereto (x) the Principal Party shall
have a sufficient number of authorized shares of its Common Stock,
which have not been issued or reserved for issuance, to permit the
exercise in full of the Rights in accordance with this Section 13,
and (y) the Company and each Principal Party and each other Person
who may become a Principal Party as a result of such consolidation,
merger, sale or transfer shall have executed and delivered to the
Rights Agent a supplemental agreement providing for the terms set
forth in Section 13(a) and (b) and further providing that, as soon
<PAGE>
as practicable after the date of any consolidation, merger, sale or
transfer of assets mentioned in Section 13(a), the Principal Party
at its own expense will:
(i) prepare and file a registration statement under the Securities
Act with respect to the Rights and the securities purchasable upon
exercise of the Rights on an appropriate form, use its reasonable
best efforts to cause such registration statement to become
effective as soon as practicable after such filing and use its
reasonable best efforts to cause such registration statement to
remain effective (with a prospectus that at all times meets the
requirements of the Securities Act) until the Expiration Date;
(ii) use its reasonable best efforts to qualify or register the
Rights and the securities purchasable upon exercise of the Rights
under the blue sky laws of such jurisdictions as may be necessary or
appropriate;
(iii) use its reasonable 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
(iv) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which
comply in all respects with the requirements for registration on
Form 10 under the Exchange Act.
(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 affairs, which provision
would have the effect of (i) causing such Principal Party to issue
(other than to holders of Rights pursuant to this Section 13), 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 current Fair Market
Value (determined pursuant to Section 11(d)) or securities
exercisable for, or convertible into, Common Stock of such Principal
Party at less than such Fair Market Value, or (ii) providing for any
special payment, tax or similar provisions in connection with the
issuance of the Common Stock of such Principal Party pursuant to the
provisions of this Section 13, then, in such event, the Company
shall not consummate any such transaction unless prior thereto the
Company 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.
The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other transfers.
<PAGE>
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue fractions of Rights,
except prior to the Distribution Date as provided in Section 11(o)
hereof, or to distribute Right Certificates which evidence
fractional Rights. If the Company elects not to issue such
fractional Rights, the Company shall pay, in lieu of such fractional
Rights, to the registered holders of the Right Certificates with
regard to which such fractional Rights would otherwise be issuable,
an amount in cash equal to the same fraction of the Fair Market
Value of a whole Right, as determined pursuant to Section 11(d)
hereof.
(b) The Company shall not be required to issue fractions of shares
of Preferred Stock (other than fractions which are integral
multiples of one ten-thousandth of a share of Preferred Stock) upon
exercise of the Rights or to distribute certificates which evidence
fractional shares of Preferred Stock (other than fractions which are
integral multiples of one ten-thousandth of a share of Preferred
Stock). In lieu of fractional shares of Preferred Stock that are
not integral multiples of one ten-thousandth of a share of Preferred
Stock, the Company may pay to the registered holders of Right
Certificates at the time such Rights are exercised as herein
provided an amount in cash equal to the same fraction of the Fair
Market Value of one ten-thousandth of a share of Preferred Stock.
For purposes of this Section 14(b), the Fair Market Value of one
ten-thousandth of a share of Preferred Stock shall be determined
pursuant to Section 11(d) hereof for the Trading Day immediately
prior to the date of such exercise.
(c) The holder of a Right by the acceptance of the Rights expressly
waives his right to receive any fractional Rights or any fractional
shares upon exercise of a Right, except as permitted by this Section
14.
Section 15. Rights of Action. All rights of action in respect of
this Agreement, other than rights of action vested in the Rights
Agent pursuant to Sections 18 and 20 hereof, are vested in the
respective registered holders of the Right Certificates (or, prior
to the Distribution Date, the registered holders of the Common Stock
of the Company); and any registered holder of any Right Certificate
(or, prior to the Distribution Date, of the Common Stock of the
Company), without the consent of the Rights Agent or of the holder
of any other Right Certificate (or, prior to the Distribution Date,
of the Common Stock of the Company), may, in such registered
holder's own behalf and for such registered holder's own benefit,
enforce, and may institute and maintain any suit, action or
proceeding against the Company to enforce, or otherwise act in
respect of, his right to exercise the Right evidenced by such Right
Certificate in the manner provided in such Right Certificate and in
this Agreement. Without limiting the foregoing or any remedies
available to the holders of Rights, it is specifically acknowledged
that the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and shall be entitled to specific
performance of the obligations hereunder and injunctive relief
against actual or threatened violations of the obligations hereunder
of any Person subject to this Agreement. Holders of Rights shall be
entitled to recover the reasonable costs and expenses, including
<PAGE>
attorneys' fees, incurred by them in any action to enforce the
provisions of this Agreement.
Section 16. Agreement of Right Holders. Every holder of a Right,
by accepting the same, consents and agrees with the Company and the
Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, each Right will be transferable
only simultaneously and together with the transfer of shares of
Common Stock of the Company;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if
surrendered at the office or offices of the Rights Agent designated
for such purpose, duly endorsed or accompanied by a proper
instrument of transfer;
(c) subject to Sections 6(a) and 7(f), the Company and the Rights
Agent may deem and treat the person in whose name a Right
Certificate (or, prior to the Distribution Date, the associated
certificate representing Common Stock of the Company) is registered
as the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the Right
Certificates or the associated certificate representing Common Stock
of the Company made by anyone other than the Company or the Rights
Agent) for all purposes whatsoever, and, subject to the last
sentence of Section 7(e), neither the Company nor the Rights Agent
shall be affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to
any holder of a Right or other Person as the 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 obligations; provided, however, that
the Company must use its best efforts to have any such order, decree
or ruling lifted or otherwise overturned as soon as possible.
Section 17. Right Certificate Holder Not Deemed a Shareholder. No
holder, as such, of any Right Certificate shall be entitled to vote,
receive dividends or be deemed for any purpose the holder of the
shares of Preferred Stock or any other securities of the Company
which may at any time be issuable on the exercise of the Rights
represented thereby, nor shall anything contained herein or in any
Right Certificate be construed to confer upon the holder of any
Right Certificate, as such, any of the rights of a shareholder of
the Company or any right to vote for the election of directors or
upon any matter submitted to shareholders at any meeting thereof, or
to give or withhold consent to any corporate action, or to receive
notice of meetings or other actions affecting shareholders (except
as provided in Section 25 hereof), or to receive dividends or
<PAGE>
subscription rights, or otherwise, until the Right or Rights
evidenced by such Right Certificate shall have been exercised in
accordance with the provisions hereof.
Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent such compensation
as shall be agreed to in writing between the Company and the Rights
Agent for all services rendered by it hereunder and, from time to
time, on demand of the Rights Agent, its reasonable expenses and
counsel fees and disbursements and other disbursements incurred in
the administration and execution of this Agreement and the exercise
and performance of its duties hereunder. The Company also agrees to
indemnify the Rights Agent for, and to hold it harmless against, any
loss, liability, or expense, incurred without gross negligence, bad
faith or willful misconduct on the part of the Rights Agent, for
anything done or omitted by the Rights Agent in connection with the
acceptance and administration of this Agreement, including the costs
and expenses of defending against any claim of liability arising
therefrom, directly or indirectly. The provisions of this Section
18(a) shall survive the expiration of the Rights and the termination
of this Agreement.
(b) The Rights Agent shall be protected and shall incur no liability
for or in respect of any action taken, suffered or omitted by it in
connection with its administration of this Agreement in reliance
upon any Right Certificate or certificate representing Common Stock
of the Company, Preferred Stock, or other securities of the Company,
instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document believed by it in
good faith and without negligence to be genuine and to be signed and
executed by the proper Person or Persons.
(c) The Rights Agent shall not be liable for consequential damages
under any provision of this Agreement or for any consequential
damages arising out of any act or failure to act hereunder.
Section 19. Merger or Consolidation or Change of Name of Rights
Agent.
(a) Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or
any corporation resulting from any merger or consolidation to which
the Rights Agent or any successor Rights Agent shall be a party, or
any corporation succeeding to the corporate trust or shareholder
services business of the Rights Agent or any successor Rights Agent,
shall be the successor to the Rights Agent under this Agreement
without the execution or filing of any paper or any further act on
the part of any of the parties hereto, provided that such
corporation would be eligible for appointment as a successor Rights
Agent under the provisions of Section 21 hereof. In case at the
time such successor Rights Agent shall succeed to the agency created
by this Agreement, any of the Right Certificates shall have been
countersigned but not delivered, any such successor Rights Agent may
adopt the countersignature of the predecessor Rights Agent and
deliver such Right Certificates so countersigned; and in case at
<PAGE>
that time any of the Right Certificates shall not have been
countersigned, any successor Rights Agent may countersign such Right
Certificates either in the name of the predecessor or in the name of
the successor Rights Agent; and in all such cases such Right
Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have
been countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Right Certificates
so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, the Rights Agent may
countersign such Right Certificates either in its prior name or in
its changed name; and in all such cases such Right Certificates
shall have the full force provided in the Right Certificates and in
this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes
the duties and obligations expressly imposed by this Agreement upon
the following terms and conditions, by all of which the Company and
the holders of Right Certificates, by their acceptance thereof,
shall be bound:
(a) The Rights Agent may consult with legal counsel selected by it
(who may be legal counsel for the Company), and the opinion of such
counsel shall be full and complete authorization and protection to
the Rights Agent as to any action taken or omitted by it in good
faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement
the Rights Agent shall deem it necessary or desirable that any fact
or matter (including, without limitation, the identity of any
Acquiring Person or Adverse Person and the determination of "Fair
Market Value") be proved or established by the Company prior to
taking or suffering any action hereunder, such fact or matter
(unless other evidence in respect thereof shall be herein
specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by a person believed by the
Rights Agent to be the Chairman of the Board of Directors, a Vice
Chairman of the Board of Directors, the President, a Vice President,
the Treasurer, any Assistant Treasurer, the Secretary or an
Assistant Secretary of the Company 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 Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable hereunder only for its own
gross negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any of
the statements of fact or recitals contained in this Agreement or in
the Right Certificates (except its countersignature thereof) or be
required to verify the same, but all such statements and recitals
are and shall be deemed to have been made by the Company only.
<PAGE>
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and
delivery hereof (except the due execution hereof by the Rights
Agent) or in respect of the validity or execution of any Right
Certificate (except its countersignature thereof); nor shall it be
responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any Right Certificate;
nor shall it be responsible for any change in the exercisability of
the Rights (including the Rights becoming void pursuant to Section
7(e) hereof) or any adjustment required under the provisions of
Sections 11, 13 or 23(c) 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 Right
Certificates after receipt of a certificate describing any such
adjustment furnished in accordance with Section 12 hereof), nor
shall it be responsible for any determination by the Board of
Directors of the Company of the Fair Market Value of the Rights or
Preferred Stock pursuant to the provisions of Section 14 hereof; nor
shall it by any act hereunder be deemed to make any representation
or warranty as to the authorization or reservation of any shares of
Common Stock of the Company or Preferred Stock to be issued pursuant
to this Agreement or any Right Certificate or as to whether any
shares of Common Stock of the Company or Preferred Stock will, when
so issued, be validly authorized and issued, fully paid and
nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge
and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and
assurances as may reasonably be required by the Rights Agent for the
carrying out or performing by the Rights Agent of the provisions of
this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder
and certificates delivered pursuant to any provision hereof from any
person believed by the Rights Agent to be the Chairman of the Board
of Directors, any Vice Chairman of the Board of Directors, the
President, a Vice President, the Secretary, an Assistant Secretary,
the Treasurer or an Assistant Treasurer of the Company, and is
authorized 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. Any application
by the Rights Agent for written instructions from the Company may,
at the option of the Rights Agent, set forth in writing any action
proposed to be taken or omitted by the Rights Agent under this
Agreement and the date on or after which such action shall be taken
or such omission shall be effective. The Rights Agent shall not be
liable for any action taken by, or omission of, the Rights Agent in
accordance with a proposal included in such application on or after
the date specified in such application (which date shall not be less
than five Business Days after the date any officer of the Company
actually receives such application, unless any such officer shall
have consented in writing to an earlier date) unless, prior to
taking any such action (or the effective date in the case of an
omission), the Rights Agent shall have received written instructions
in response to such application specifying the action to be taken or
omitted.
<PAGE>
(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 Company or become pecuniarily
interested in any transaction in which the Company may be
interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not the Rights
Agent under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or
for any other 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.
(j) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder or in
the exercise of its rights if there shall be reasonable grounds for
believing that repayment of such funds or adequate indemnification
against such risk or liability is not reasonably assured to it.
(k) If, with respect to any Right Certificate surrendered to the
Rights Agent for exercise or transfer, the certificate attached to
the form of assignment or form of election to purchase, as the case
may be, has either not been completed or indicates an affirmative
response to clause (1) or clause (2) thereof, the Rights Agent shall
not take any further action with respect to such requested exercise
or transfer without first consulting with the Company.
Section 21. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties
under this Agreement upon thirty (30) days' notice in writing mailed
to the Company by first class mail. The Company may remove the
Rights Agent or any successor Rights Agent (with or without cause)
upon thirty (30) days' notice in writing, mailed to the Rights Agent
or successor Rights Agent, as the case may be, and to each transfer
agent of the Common Stock of the Company and Preferred Stock by
registered or certified mail, and to the holders of the Right
Certificates by first-class mail. If the Rights Agent shall resign
or be removed or shall otherwise become incapable of acting, the
Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of
thirty (30) days after giving notice of such removal or after it has
been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the holder of a Right
Certificate (who shall, with such notice, submit his Right
Certificate for inspection by the Company), then the incumbent
Rights Agent or the registered holder of any Right Certificate may
apply to any court of competent jurisdiction for the appointment of
a new Rights Agent. Any successor Rights Agent, whether appointed
by the Company or by such a court, shall be (a) a corporation
organized and doing business under the laws of the United States or
of the Commonwealth of Massachusetts or the State of New York (or of
any other state of the United States so long as such corporation is
authorized to do business as a banking institution in the
Commonwealth of Massachusetts or the State of New York), in good
standing, which is authorized under such laws to exercise stock
transfer or corporate trust powers and is subject to supervision or
examination by federal or state authority and which has at the time
<PAGE>
of its appointment as Rights Agent a combined capital and surplus of
at least $100,000,000 or (b) an Affiliate of a corporation described
in clause (a) of this sentence. After appointment, the successor
Rights Agent shall be vested with the same powers, rights, duties
and responsibilities as if it had been originally named as Rights
Agent without further act or deed; but the predecessor Rights Agent
shall deliver and transfer to the successor Rights Agent any
property at the time held by it hereunder, and execute and deliver
any further assurance, conveyance, act or deed necessary for the
purpose. Not later than the effective date of any such appointment,
the Company shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Common Stock
of the Company and the Preferred Stock, and mail a notice thereof in
writing to the registered holders of the Right Certificates.
Failure to give any notice provided for in this Section 21, however,
or any defect therein, shall not affect the legality or validity of
the resignation or removal of the Rights Agent or the appointment of
the successor Rights Agent, as the case may be.
Section 22. Issuance of New Right Certificates. Notwithstanding
any of the provisions of this Agreement or of the Rights to the
contrary, the Company may, at its option, issue new Right
Certificates evidencing Rights in such form as may be approved by
its Board of Directors 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 Right
Certificates made in accordance with the provisions of this
Agreement. In addition, in connection with the issuance or sale of
shares of Common Stock of the Company following the Distribution
Date and prior to the redemption or expiration of the Rights, the
Company (a) shall, with respect to shares of Common Stock of the
Company so issued or sold pursuant to the exercise of stock options
or under any employee plan or arrangement, or upon the exercise,
conversion or exchange of securities hereafter issued by the
Company, and (b) may, in any other case, if deemed necessary or
appropriate by the Board of Directors of the Company, issue Right
Certificates representing the appropriate number of Rights in
connection with such issuance or sale; provided, however, that (i)
no such Right Certificate shall be issued if, and to the extent
that, the Company shall be advised by counsel that such issuance
would create a significant risk of material adverse tax consequences
to the Company or the person to whom such Right Certificate would be
issued, and (ii) no such Right Certificate shall be issued if, and
to the extent that, appropriate adjustments shall otherwise have
been made in lieu of the issuance thereof.
Section 23. Redemption.
(a) The Board of Directors of the Company may, at its option, redeem
all but not less than all of the then outstanding Rights at a
redemption price of $.001 per Right, appropriately adjusted to
reflect any dividend declared or paid on the Common Stock of the
Company in shares of Common Stock of the Company or any subdivision
or combination of the outstanding shares of Common Stock of the
Company or similar event occurring after the date of this Agreement
(such redemption price, as adjusted from time to time, being
hereinafter referred to as the "Redemption Price"). The Rights may
be redeemed only until the earlier to occur of (i) 5:00 P.M.,
Boston, Massachusetts time, on the tenth calendar day after the
Stock Acquisition Date, (ii) the declaration by the Board of
<PAGE>
Directors that any Person is an Adverse Person or (iii) the Final
Expiration Date.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights, and without any
further action and without any notice, the right to exercise the
Rights will terminate and the only right thereafter of the holders
of Rights shall be to receive the Redemption Price for each Right so
held. Promptly after the action of the Board of Directors ordering
the redemption of the Rights, the Company shall give notice of such
redemption to the Rights Agent and the holders of the then
outstanding Rights by mailing such notice to the Rights Agent and 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 of the Company. Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of redemption will state the
method by which the payment of the Redemption Price will be made.
Neither the Company nor any of its Affiliates or Associates may
redeem, acquire or purchase for value any Rights at any time in any
manner other than that specifically set forth in this Section 23 or
Section 24 hereof or in connection with the purchase of shares of
Common Stock of the Company prior to the Distribution Date.
(c) The Company may, at its option, pay the Redemption Price in
cash, shares of Common Stock of the Company (based on the Fair
Market Value of the Common Stock of the Company as of the time of
redemption) or any other form of consideration deemed appropriate by
the Board of Directors.
Section 24. Exchange.
(a) (i) The Board of Directors of the Company may, at its option, at
any time on or after the Distribution Date, 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 of the Company at an
exchange ratio of one share of Common Stock of the Company 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 "Section
24(a)(i) 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 Common Stock of the Company.
(ii) Notwithstanding the foregoing, the Board of Directors of the
Company may, at its option, at any time on or after the Distribution
Date, exchange all or part of the then outstanding and exercisable
Rights (which shall not include Rights that have become void
<PAGE>
pursuant to the provisions of Section 7(e) hereof) for shares of
Common Stock of the Company at an exchange ratio specified in the
following sentence, as appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the
date of this Agreement. Subject to the adjustment described in the
foregoing sentence, each Right may be exchanged for that number of
shares of Common Stock of the Company obtained by dividing the
Spread (as defined in Section 11(a)(iii)) by the then Fair Market
Value per one ten-thousandth of a share of Preferred Stock on the
earlier of (x) the date on which any person becomes an Acquiring
Person or (y) the date on which a tender or exchange offer by any
Person (other than an Exempt Person) is first published or sent or
given within the meaning of Rule 14d-4(a) of the Exchange Act or any
successor rule, if upon consummation thereof such Person would be
the Beneficial Owner of more than 15% of the shares of Common Stock
of the Company then outstanding (such exchange ratio being referred
to herein as the "Section 24(a)(ii) 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 Common Stock of the Company.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the exchange of any Rights pursuant to subsection
(a) of this Section 24 and without any further action and without
any notice, the right to exercise such Rights shall terminate and
the only right thereafter of a holder of such Rights shall be to
receive that number of shares of Common Stock of the Company equal
to the number of such Rights held by such holder multiplied by the
Section 24(a)(i) Exchange Ratio or the Section 24(a)(ii) Exchange
Ratio, as applicable. The Company shall promptly give notice of any
such exchange in accordance with Section 26 hereof and shall
promptly 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; provided, however, that the failure to
give, or any defect in, such notice shall not affect the validity of
such exchange. Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives
the notice. Each such notice of exchange will state the method by
which the exchange of the shares of Common Stock of the Company 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 any exchange pursuant to this Section 24, the Company, at its
option, may substitute Preferred Stock (or Preferred Stock
Equivalent, as such term is defined in Section 11(b) hereof) for
Common Stock of the Company exchangeable for Rights, at the initial
rate of one ten-thousandth of a share of Preferred Stock (or
Preferred Stock Equivalent) for each share of Common Stock of the
Company, as appropriately adjusted to reflect adjustments in the
voting rights of the Preferred Stock pursuant to the terms thereof,
<PAGE>
so that the fraction of a share of Preferred Stock delivered in lieu
of each share of Common Stock of the Company shall have the same
voting rights as one share of Common Stock of the Company.
(d) In the event that there shall not be sufficient shares of Common
Stock of the Company or Preferred Stock (or Preferred Stock
Equivalent) issued but not outstanding or authorized but unissued to
permit any exchange of Rights as contemplated in accordance with
this Section 24, the Company shall take all such action as may be
necessary to authorize additional shares of Common Stock of the
Company or Preferred Stock (or Preferred Stock Equivalent) for
issuance upon exchange of the Rights.
(e) The Company shall not be required to issue fractions of Common
Stock of the Company or to distribute certificates which evidence
fractional shares of Common Stock of the Company. If the Company
elects not to issue such fractional shares of Common Stock of the
Company, the Company shall pay, in lieu of such fractional shares of
Common Stock of the Company, to the registered holders of the Right
Certificates with regard to which such fractional shares of Common
Stock of the Company would otherwise be issuable, an amount in cash
equal to the same fraction of the Fair Market Value of a whole share
of Common Stock of the Company. For the purposes of this paragraph
(e), the Fair Market Value of a whole share of Common Stock of the
Company shall be the closing price of a share of Common Stock of the
Company (as determined pursuant to the second sentence of Section
11(d)(i) hereof) for the Trading Day immediately prior to the date
of exchange pursuant to this Section 24.
Section 25. Notice of Certain Events.
(a) In case the Company shall propose, at any time after the
Distribution Date, (i) to pay any dividend payable in stock of any
class to the holders of Preferred Stock or to make any other
distribution to the holders of Preferred Stock (other than a regular
periodic cash dividend out of earnings or retained earnings of the
Company), or (ii) to offer to the holders of Preferred Stock rights
or warrants to subscribe for or to purchase any additional shares of
Preferred Stock or shares of stock of any class or any other
securities, rights or options, or (iii) to effect any
reclassification of its Preferred Stock (other than a
reclassification involving only the subdivision of outstanding
shares of Preferred Stock), or (iv) to effect any consolidation or
merger into or with, or to effect any sale, mortgage or other
transfer (or to permit one or more of its Subsidiaries to effect any
sale, mortgage or other transfer), in one transaction or a series of
related transactions, of 50% or more of the assets or earning power
of the Company and its Subsidiaries (taken as a whole) to, any other
Person (other than a Subsidiary of the Company in one or more
transactions each of which is not prohibited by the proviso at the
end of the first sentence of Section 11(n) hereof), (v) to effect
the liquidation, dissolution or winding up of the Company, or (vi)
to declare or pay any dividend on the Common Stock of the Company
<PAGE>
payable in Common Stock of the Company or to effect a subdivision,
combination or consolidation of the Common Stock of the Company (by
reclassification or otherwise than by payment of dividends in Common
Stock of the Company) then in each such case, the Company shall give
to each holder of a Right Certificate and to the Rights Agent, in
accordance with Section 26 hereof, a notice of such proposed action,
which shall specify the record date for the purposes of such stock
dividend, distribution of rights or warrants, or the date on which
such reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution, or winding up is to take place and the
date of participation therein by the holders of the shares of Common
Stock of the Company and/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 twenty (20) days
prior to the record date for determining holders of the shares of
Preferred Stock for purposes of such action, and in the case of any
such other action, at least twenty (20) days prior to the date of
the taking of such proposed action or the date of participation
therein by the holders of the shares of Common Stock of the Company
and/or Preferred Stock, whichever shall be the earlier; provided,
however, no such notice shall be required pursuant to this Section
25 as a result of any Subsidiary of the Company effecting a
consolidation or merger with or into, or effecting a sale or other
transfer of assets or earnings power to, any other Subsidiary of the
Company in a manner not inconsistent with the provisions of this
Agreement.
(b) In case any Section 11(a)(ii) Event shall occur, then, in any
such case, the Company shall as soon as practicable thereafter give
to each registered holder of a Right Certificate and to the Rights
Agent, in accordance with Section 26 hereof, a notice of the
occurrence of such event, which shall specify the event and the
consequences of the event to holders of Rights under Section
11(a)(ii) hereof.
Section 26. Notices. Notices or demands authorized by this
Agreement to be given or made by the Rights Agent or by the holder
of any Right Certificate to or on the Company shall be sufficiently
given or made if sent by first-class mail, postage prepaid, by
facsimile transmission or by nationally-recognized overnight courier
addressed (until another address is filed in writing with the Rights
Agent) as follows:
Westbank Corporation 225 Park Avenue West Springfield, Massachusetts
01090 Attention: Clerk
Subject to the provisions of Section 21, any notice or demand
authorized by this Agreement to be given or made by the Company or
by the holder of any Right Certificate to or on the Rights Agent
shall be sufficiently given or made if sent by first-class mail,
postage prepaid, by facsimile transmission or by
nationally-recognized overnight courier addressed (until another
address is filed in writing with the Company) as follows:
State Street Bank and Trust Company 150 Royall Street Canton,
Massachusetts 02021 Attention: Administration
Notices or demands authorized by this Agreement to be given or made
<PAGE>
by the Company or the Rights Agent to the holder of any Right
Certificate (or, prior to the Distribution Date, to the holder of
any certificate representing shares of Common Stock of the Company)
shall be sufficiently given or made if sent by first-class mail,
postage prepaid, addressed to such holder at the address of such
holder as shown on the registry books of the Company.
Section 27. Supplements and Amendments. Prior to the Distribution
Date, the Company and the Rights Agent shall, if the Company so
directs, supplement or amend any provision of this Agreement as the
Company may deem necessary or desirable without the approval of any
holders of certificates representing shares of Common Stock of the
Company. From and after the Distribution Date, the Company and the
Rights Agent shall, if the Company so directs, supplement or amend
this Agreement without the approval of any holder of Right
Certificates in order (i) to cure any ambiguity, (ii) to correct or
supplement any provision contained herein which may be defective or
inconsistent with any other provisions herein, (iii) to shorten or
lengthen any time period hereunder, or (iv) to change or supplement
the provisions hereof in any manner which the Company may deem
necessary or desirable and which shall not adversely affect the
interests of the holders of Right Certificates (other than an
Acquiring Person, Adverse Person or any Affiliate or Associate of an
Acquiring Person or Adverse Person); provided, however, that from
and after the Distribution Date this Agreement may not be
supplemented or amended to lengthen, pursuant to clause (iii) of
this sentence, (A) a time period relating to when the Rights may be
redeemed at such time as the Rights are not then redeemable or (B)
any other time period unless such lengthening is for the purpose of
protecting, enhancing or clarifying the rights of, and the benefits
to, the holders of Rights (other than an Acquiring Person, Adverse
Person or any Affiliate or Associate of an Acquiring Person or
Adverse Person). Without limiting the foregoing, the Company may at
any time prior to such time as any Person becomes an Acquiring
Person amend this Agreement to lower the threshold set forth in
Section 1(a) to not less than the greater of (i) the sum of .001%
and the largest percentage of the outstanding Common Stock of the
Company then known by the Company to be beneficially owned by any
Person (other than the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or any Subsidiary of the
Company, or any entity holding Common Stock of the Company for or
pursuant to the terms of any such plan) and (ii) 10%. Upon the
delivery of such certificate from an appropriate officer of the
Company which states that the proposed supplement or amendment is in
compliance with the terms of this Section 27, the Rights Agent shall
execute such supplement or amendment. Prior to the Distribution
Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Common Stock of the
Company. Notwithstanding any other provision hereof, the Rights
Agent's consent must be obtained regarding any amendment or
supplement pursuant to this Section 27 which alters the Rights
Agent's rights or duties.
Section 28. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent
shall bind and inure to the benefit of their respective successors
and assigns hereunder.
Section 29. Determinations and Actions by the Board of Directors.
For all purposes of this Agreement, any calculation of the number of
<PAGE>
shares of Common Stock of the Company outstanding at any particular
time, including for purposes of determining the particular
percentage of such outstanding shares of Common Stock of the Company
of which any Person is the Beneficial Owner, shall be made in
accordance with the last sentence of Rule 13d-3(d)(1)(i) of the
Rules under the Exchange Act as in effect on the date hereof. 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 any member of the Board of Directors to any
liability to the holders of the Rights or to any other person.
Section 30. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than
the Company, the Rights Agent and the registered holders of the
Right Certificates (and, prior to the Distribution Date, the Common
Stock of the Company) any legal or equitable right, remedy or claim
under this Agreement; but this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the
registered holders of the Right Certificates (and, prior to the
Distribution Date, registered holders of the Common Stock of the
Company).
Section 31. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated; provided,
however, that notwithstanding anything in this Agreement to the
contrary, if any such term, provision, covenant or restriction is
held by such court or authority to be invalid, void or unenforceable
and the Board of Directors of the Company determines in its good
faith judgment that severing the invalid language from the Agreement
would adversely affect the purpose or effect of the Agreement, the
right of redemption set forth in Section 23 hereof shall be
reinstated and shall not expire until the Close of Business on the
tenth day following the date of such determination by the Board of
Directors.
Section 32. Governing Law. This Agreement, each Right and each
Right Certificate issued hereunder shall be deemed to be a contract
made under the laws of the Commonwealth of Massachusetts and for all
purposes shall be governed by and construed in accordance with the
laws of such Commonwealth applicable to contracts to be made and to
be performed entirely within such Commonwealth. The courts of the
Commonwealth of Massachusetts and of the United States of America
located in the Commonwealth of Massachusetts (the "Massachusetts
Courts") shall have exclusive jurisdiction over any litigation
<PAGE>
arising out of or relating to this Agreement and the transactions
contemplated hereby, and any Person commencing or otherwise involved
in any such litigation shall waive any objection to the laying of
venue of such litigation in the Massachusetts Courts and shall not
plead or claim in any Massachusetts Court that such litigation
brought therein has been brought in an inconvenient forum.
Section 33. Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all
purposes be deemed to be an original, and all such counterparts
shall together constitute but one and the same instrument.
Section 34. Descriptive Headings. Descriptive headings of the
several Sections of this Agreement are inserted for convenience only
and shall not control or affect the meaning or construction of any
of the provisions hereof.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as an instrument under seal and attested, all as of
the day and year first above written.
ATTEST: WESTBANK CORPORATION
By:/s/ John M. Lilly By:/s/ Donald R. Chase
Name: John M. Lilly Name: Donald R. Chase
Title: President
ATTEST: STATE STREET BANK AND TRUST COMPANY, as Rights Agent
By:/s/ Scott L. Lanciloti By:/s/ Joseph E. McDavitt
Name: Scott L. Lanciloti Name: Joseph E. McDavitt
Title: Vice President
