<PAGE> 1
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
Invacare Corporation
(Exact name of registrant as specified in its charter)
Ohio 95-2680965
- - ------------------------ -----------------------------------
(State of Incorporation) (IRS Employer Identification No.)
899 Cleveland Street, Elyria, Ohio 44036
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(Address of principal executive offices and zip code)
Securities to be registered pursuant to Section 12(b) of the Act:
None
----------------
(Title of Class)
Securities to be registered pursuant to Section 12(g) of the Act:
Rights to Purchase Common Shares of
Invacare Corporation, without par value
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(Title of Class)
<PAGE> 2
ITEM 1. Description of Registrant's Securities to be Registered
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On July 7, 1995, the Directors of Invacare Corporation (the "Company")
declared a dividend distribution of one Right for each outstanding common share
without par value (the "Common Shares") and each outstanding Class B common
share without par value ("Class B Common Shares"), of the Company. The
distribution is payable on July 18, 1995 to the shareholders of record on July
18, 1995. Each Right entitles the registered holder to purchase from the
Company one-tenth of one Common Share at a price of $16 per one-tenth share
(the "Purchase Price"), subject to adjustment. The description and terms of
the Rights are set forth in a Rights Agreement dated as of July 7, 1995 (the
"Rights Agreement") between the Company and National City Bank, as Rights Agent
(the "Rights Agent").
Until the earlier to occur of (i) 10 days following a public announcement
that a person or group of affiliated or associated persons (an "Acquiring
Person") has acquired, or obtained the right to acquire, beneficial ownership
of 30% or more of the outstanding voting power of the Company or (ii) 10 days
(or such later date as may be determined by action of the Board of Directors
prior to such time as any person becomes an Acquiring Person) following the
commencement of a tender offer or exchange offer for 30% or more of the
outstanding voting power of the Company (the earlier of such dates being called
the "Distribution Date"), the Rights will be evidenced, with respect to any of
the Common Share or Class B Common Share certificates outstanding as of July
18, 1995, by such Common Share or Class B Common Share certificate and, with
respect to Common Shares or Class B Common Shares of the Company without par
value thereafter issued (prior to the Expiration or Final Expiration Date) by
the certificates for such Common Shares or Class B Common Shares. The Rights
Agreement provides that, until the Distribution Date, the Rights will be
transferred with and only with the Common Shares and Class B Common Shares.
Until the Distribution Date (or earlier redemption or expiration of the
Rights), new Common Share or Class B Common Share certificates issued after
July 18, 1995 upon a transfer or new issuance of the Common Shares or Class B
Common Shares will contain a notation incorporating the Rights Agreement by
reference. Until the Distribution Date (or earlier redemption or expiration of
the Rights), the surrender for transfer of any certificates for Common Shares
or Class B Common Shares outstanding as of July 18, 1995 or thereafter issued
prior to the Distribution Date, will also constitute the transfer of the Rights
associated with the Common Shares or Class B Common Shares represented by such
certificate. As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be mailed to
holders of record of the Common Shares or Class B Common Shares as of the close
of business on the Distribution Date and such separate Right Certificates alone
will evidence the Rights.
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The Rights are not exercisable until the Distribution Date. The Rights will
expire on July 7, 2005, unless earlier redeemed by the Company as described
below.
The Purchase Price payable, and the number of Common Shares 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 Common
Shares or Class B Common Shares, (ii) upon the grant to holders of the Common
Shares or Class B Common Shares of certain rights or warrants to subscribe for
Common Shares or convertible securities at less than the current market price
of the Common Shares, or (iii) upon the distribution to holders of the Common
Shares or Class B Common Shares of evidences of indebtedness or assets
(excluding regular quarterly cash dividends on Common Shares or Class B Common
Shares and excluding dividends paid in Common Shares or Class B Common Shares)
or of subscription rights or warrants (other than those referred to above).
In the event that the Company is acquired by an Acquiring Person in a merger
or other business combination transaction or 50% or more of its assets or
earning power are sold to an Acquiring Person, proper provision shall be made
so that each holder of a Right, other than Rights that are or were beneficially
owned by the Acquiring Person after the date upon which the Acquiring Person
became such (which will thereafter be void), shall thereafter have the right to
receive, upon the exercise thereof at the then current exercise price of the
Right, that number of shares of common stock (or, under certain circumstances,
an economically equivalent security or securities) of the surviving, resulting
or acquiring person which at the time of such transaction would have a market
value of two times the exercise price of the Right. In the event that an
Acquiring Person merges into the Company and the Company's Common Shares are
not changed or exchanged, or in the event that an Acquiring Person engages in
one of a number of self-dealing transactions specified in the Rights Agreement,
proper provision shall be made so that each holder of a Right, other than
Rights that are or were beneficially owned by the Acquiring Person after the
date upon which the Acquiring Person became such (which will thereafter be
void), will thereafter have the right to receive upon exercise thereof at the
then current exercise price of the Right, that number of Common Shares having a
market value of two times the exercise price of the Right.
With certain exceptions, no adjustment in the Purchase Price will be required
until cumulative adjustments require an adjustment of at least 1% in such
Purchase Price. No fractional shares will be issued and in lieu thereof, an
adjustment in cash will be made based on the market price of the Common Shares
on the last trading date prior to the date of exercise.
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At any time prior to such time as any person becomes an Acquiring Person, the
Company may redeem the Rights in whole, but not in part, at a price of $0.01
per Right, subject to adjustment (the "Redemption Price"). Immediately upon
the action of the Board of Directors of the Company electing to redeem the
Rights, the right to exercise the Rights will terminate and the only right of
the holders of Rights will be to receive the Redemption Price. The Company
shall give notice of such redemption to the holders of the then outstanding
Rights by mailing such notice to all holders at their last addresses as they
appear on the Registry Books of the Rights Agent.
Until a Right is exercised, the holder thereof, as such, will have no rights
as a shareholder of the Company, including, without limitation, the right to
vote or to receive dividends.
As of March 31, 1995 there were 11,967,036 Common Shares and 2,584,525 Class
B Common Shares outstanding. The Company will reserve for issuance upon
exercise of the Rights one-tenth of the aggregate number of Common Shares and
Class B Common Shares that are issued and reserved for issuance at any time.
The form of Rights Agreement specifying the terms of the Rights, which
includes as Exhibit A the form of Right Certificate are attached hereto as
exhibits and are incorporated herein by reference. The foregoing description
of the Rights is qualified by reference to such exhibits.
ITEM 2. Exhibits
--------
1, 2 Rights Agreement between Invacare Corporation and the Rights Agent,
dated as of July 7, 1995 which includes as Exhibit A the form of Right
Certificate.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the registrant has duly caused this registration statement to be signed
on its behalf by the undersigned, thereto duly authorized.
INVACARE CORPORATION
(Registrant)
By /s/ Thomas R. Miklich
______________________________
Thomas R. Miklich
Chief Financial Officer
July 25, 1995
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<TABLE>
FORM 8-A
Exhibit Index
<CAPTION>
Exhibit Page
Number Description No.
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<S> <C>
1 Rights Agreement between Invacare Corporation and the Rights Agent,
dated as of July 7, 1995.
2 Form of Right Certificate (Exhibit A to the Rights Agreement).
</TABLE>
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<PAGE> 1
________________________________________________________________________________
INVACARE CORPORATION
and
NATIONAL CITY BANK
RIGHTS AGREEMENT
Dated as of July 7, 1995
________________________________________________________________________________
<PAGE> 2
<TABLE>
TABLE OF CONTENTS
<CAPTION>
PAGE
----
<S> <C>
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1. Certain Definitions . . . . . . . . . . . . . . . . . . . . . . . 1
Section 2. Appointment of Rights Agent . . . . . . . . . . . . . . . . . . . 3
Section 3. Issue of Right Certificates . . . . . . . . . . . . . . . . . . . 4
Section 4. Form of Right Certificates . . . . . . . . . . . . . . . . . . . 6
Section 5. Countersignature and Registration . . . . . . . . . . . . . . . . 6
Section 6. Transfer, Split Up, Combination and
Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen
Right Certificates . . . . . . . . . . . . . . . . . . . . . . . 7
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights . . . . . . . . . . . . . . . . . . . . 8
Section 8. Cancellation and Destruction of Right
Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 9. Reservation and Availability of
Common Shares . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 10. Common Shares Record Date . . . . . . . . . . . . . . . . . . . . 10
Section 11. Adjustment of Purchase Price, Number
and Type of Shares or Number of Rights . . . . . . . . . . . . . 10
Section 12. Certificate of Adjusted Purchase Price or
Number of Shares . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 13. Notice of Adjusted Purchase Price or
Number or Type of Shares to Holders
of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 14. Fractional Rights and Fractional
Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 15. Rights of Action . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 16. Agreement of Rights Holders . . . . . . . . . . . . . . . . . . . 22
Section 17. Right Certificate Holder Not Deemed a
Shareholder . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
</TABLE>
(i)
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<TABLE>
TABLE OF CONTENTS
(continued)
<CAPTION>
PAGE
----
<S> <C>
Section 18. Concerning the Rights Agent . . . . . . . . . . . . . . . . . . . 23
Section 19. Merger or Consolidation or Change
of Name of Rights Agent . . . . . . . . . . . . . . . . . . . . . 23
Section 20. Duties of Rights Agent . . . . . . . . . . . . . . . . . . . . . 24
Section 21. Change of Rights Agent . . . . . . . . . . . . . . . . . . . . . 26
Section 22. Issuance of New Right Certificates . . . . . . . . . . . . . . . 27
Section 23. Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 24. Notice of Certain Events . . . . . . . . . . . . . . . . . . . . 28
Section 25. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 26. Supplements and Amendments . . . . . . . . . . . . . . . . . . . 29
Section 27. Determinations and Actions by the
Board of Directors, etc. . . . . . . . . . . . . . . . . . . . . 30
Section 28. Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 29. Benefits of this Agreement . . . . . . . . . . . . . . . . . . . 31
Section 30. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 31. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 32. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 33. Descriptive Headings . . . . . . . . . . . . . . . . . . . . . . 32
Exhibit A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
</TABLE>
(ii)
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Rights Agreement, dated as of July 7, 1995 ("Agreement"), between
INVACARE CORPORATION, an Ohio corporation (the "Company"), and NATIONAL CITY
BANK, a national banking association (the "Rights Agent").
RECITALS
--------
The Directors of the Company have authorized and declared a dividend
consisting of one right ("Right") for each Common Share, without par value
("Common Share"), and for each Class B Common Share, without par value ("Class
B Common Share"), of the Company outstanding on July 18, 1995, each Right
representing the right to purchase one-tenth of one Common Share, and have
authorized the issuance of one Right with respect to each Common Share or Class
B Common Share issued after July 18, 1995 but prior to the earlier of the
Expiration Date or the Final Expiration Date (as such terms are defined in
Section 7 hereof), including, without limitation, Common Shares issued upon
exercise of employee stock options, but excluding Common Shares issued upon
exercise of any Right.
Accordingly, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
Section 1. CERTAIN DEFINITIONS.
For purposes of this Agreement, the following terms have the meanings
indicated:
(a) "Acquiring Person" shall mean any Person (as such
term is hereinafter defined) who or which, together with all Affiliates and
Associates (as such terms are hereinafter defined) of such Person, shall be the
Beneficial Owner (as such term is hereinafter defined) of 30% or more of the
total outstanding voting power of the Company, but shall not include the
Company, any Subsidiary or any employee benefit or stock ownership plan of the
Company or an entity holding Common Shares or Class B Common Shares (each as
hereafter defined) for or pursuant to the terms of any such plan.
Notwithstanding the foregoing, no Person shall become an "Acquiring Person" as
the result of an acquisition of Common Shares or Class B Common Shares by the
Company which, by reducing the number of shares outstanding, increases the
proportionate number of shares beneficially owned by such Person to 30% or more
of the then total outstanding voting power of the Company; PROVIDED, HOWEVER,
that if a Person shall become the Beneficial Owner of 30% or more of the then
total outstanding voting power of the Company by reason of share purchases by
the Company and shall, after such share purchases by the Company, become the
Beneficial Owner of any additional Common Shares or Class B Common Shares of
the Company, then such Person shall be deemed to be an "Acquiring Person."
Notwithstanding the foregoing, if the Board of Directors of the Company
determines in good faith that a Person who would
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otherwise be an "Acquiring Person," as defined pursuant to the foregoing
provisions of this paragraph (a), has become such inadvertently, and such
Person divests as promptly as practicable a sufficient number of Common Shares
or Class B Common Shares so that such Person would no longer be an "Acquiring
Person," as defined pursuant to the foregoing provisions of this paragraph (a),
then such Person shall not be deemed to be an "Acquiring Person" for any
purposes of this Agreement.
(b) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), as in effect on the date hereof.
(c) A Person shall be deemed the "Beneficial Owner" of
and shall be deemed to "beneficially own" any securities:
(i) which such Person or any of such Person's
Affiliates or Associates beneficially owns, directly or indirectly;
(ii) which such Person or any of such Person's
Affiliates or Associates has (A) the right to acquire (whether such right is
exercisable immediately or only after the passage of time) pursuant to any
agreement, arrangement or understanding, or upon the exercise of conversion
rights, exchange rights, rights (other than these Rights), warrants or options,
or otherwise; PROVIDED, HOWEVER, that a Person shall not be deemed the
Beneficial Owner of, or to beneficially own, securities tendered pursuant to a
tender or exchange offer made by or on behalf of such Person or any of such
Person's Affiliates or Associates until such tendered securities are accepted
for purchase or exchange; or (B) the right to vote pursuant to any agreement,
arrangement or understanding; PROVIDED, HOWEVER, that a Person shall not be
deemed the Beneficial Owner of, or to beneficially own, any security under this
clause (B) if such Person has the right to vote such security pursuant to an
agreement, arrangement or understanding which (1) arises solely from a
revocable proxy given to such Person in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the applicable rules and
regulations of the Exchange Act and (2) is not also then reportable on Schedule
13D under the Exchange Act (or any comparable or successor report); or
(iii) which are beneficially owned, directly or
indirectly, by any other Person with which such Person or any of such Person's
Affiliates or Associates has any agreement, arrangement or understanding for
the purpose of acquiring, holding, voting (except as described in Section
1(c)(ii)(B) above) or disposing of any securities of the Company.
(d) "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in the
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State of Ohio are authorized or obligated by law or executive order to close.
(e) "Close of business" on any given date shall mean 5:00
P.M., Cleveland, Ohio time, on such date; PROVIDED, HOWEVER, that if such date
is not a Business Day it shall mean 5:00 P.M., Cleveland, Ohio time, on the
next succeeding Business Day.
(f) "Common Shares" when used with reference to the
Company shall mean the Common Shares, without par value, of the Company
PROVIDED, that "Common Shares" when used with reference to any Person, other
than the Company, shall mean the capital stock with the greatest aggregate
voting power of such Person. "Class B Common Shares," when used with reference
to the Company, shall mean Class B Common Shares, without par value, of the
Company.
(g) "Disinterested Director" shall mean any member of the
Company's Board of Directors who is not an officer or employee of the Company
or any Subsidiary and is unaffiliated with an Acquiring Person or any
Affiliates or Associates of an Acquiring Person and was a member of the
Company's Board of Directors prior to the time that the Acquiring Person became
an Acquiring Person, and any successor of a Disinterested Director who is not
an officer or employee of the Company or any Subsidiary and is unaffiliated
with an Acquiring Person or any Affiliates or Associates of an Acquiring Person
and is recommended to succeed a Disinterested Director by a majority of
Disinterested Directors then on the Company's Board of Directors.
(h) "Person" shall mean any individual, firm, corporation
or other entity.
(i) "Share Acquisition Date" shall mean the first date of
public announcement by the Company or an Acquiring Person (by press release,
filing made with the Securities and Exchange Commission or otherwise) that an
Acquiring Person has become such.
(j) "Subsidiary" shall mean any corporation or other
entity of which a majority of the voting power of the voting equity securities
or equity interests is owned, directly or indirectly, by the Company.
Section 2. APPOINTMENT OF RIGHTS AGENT.
The Company hereby appoints the Rights Agent to act as agent for the
Company and the holders of the Rights (who, in accordance with Section 3
hereof, shall also be, prior to the Distribution Date, the holders of the
Common Shares and Class B Common Shares) in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time act as Co-Rights Agent or appoint such Co-Rights
Agents as it may deem necessary or desirable. Any actions which may be taken
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by the Rights Agent pursuant to the terms of this Agreement may be taken by any
such Co-Rights Agent.
Section 3. ISSUE OF RIGHT CERTIFICATES.
(a) Until the earlier of (i) the tenth calendar day after
the Share Acquisition Date or (ii) the tenth calendar day (or such later date
as may be determined by action of the Board of Directors prior to such time as
any Person becomes an Acquiring Person) after the date of the commencement of a
tender or exchange offer (as determined by reference to Rule 14d-2(a) under the
Exchange Act) by any Person (other than the Company or any employee benefit
plan of the Company) for 30% or more of the total outstanding voting power of
the Company (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 paragraph (b) of this Section 3) by the
certificates for Common Shares and Class B Common Shares registered in the
names of the record holders thereof (which certificates for Common Shares and
Class B Common Shares shall also be deemed to be Right Certificates) and not by
separate Right Certificates, and (y) the right to receive Right Certificates
will be transferable only in connection with the transfer of Common Shares and
Class B Common Shares in the stock transfer books of the Company maintained by
the Company or its appointed transfer agent. As soon as practicable after the
Distribution Date, the Rights Agent will send, by first-class, insured, postage
prepaid mail, to each record holder of Common Shares and Class B Common Shares
as of the close of business on the Distribution Date, at the address of such
holder shown on the records of the Company, a Right Certificate, in
substantially the form of Exhibit A hereto, evidencing one Right for each
Common Share or Class B Common Share so held, together with a notice setting
forth the Purchase Price (as defined in Section 4 hereof) as in effect on the
Distribution Date. As of the Distribution Date, the Rights will be evidenced
solely by such Right Certificates.
Whenever the Company issues any Common Shares or Class B Common Shares
after the Distribution Date but prior to the earlier of the Expiration Date or
the Final Expiration Date (as such terms are defined in Section 7 hereof), the
Company shall notify the Rights Agent of the record holder or holders of such
Common Shares or Class B Common Shares and as soon as practicable after receipt
of such notice, the Rights Agent will send, by first-class, insured, postage
prepaid mail, to each such holder, at the address of such holder shown on the
records of the Company, a Right Certificate evidencing one Right for each
Common Share or Class B Common Share so held.
Any Right Certificate issued pursuant to this Section 3 that
represents Rights beneficially owned by an Acquiring Person or any
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Associate or Affiliate thereof and any Right Certificate issued at any time
upon the transfer of any Rights to an Acquiring Person or any Associate or
Affiliate thereof or to any nominee of such Acquiring Person, Associate or
Affiliate, and any Right Certificate issued pursuant to Section 6 or Section 11
upon transfer, exchange, replacement or adjustment of any other Right
Certificate referred to in this sentence, shall be subject to and contain the
following legend:
The Rights represented by this Right Certificate were issued
to a Person who was an Acquiring Person or an Affiliate or an
Associate of an Acquiring Person. This Right Certificate and
the Rights represented hereby may become null and void in the
circumstances specified in Section 11(a)(ii) or Section 11(d)
of the Rights Agreement.
(b) With respect to certificates for Common Shares or
Class B Common Shares outstanding as of July 18, 1995, or certificates
representing Common Shares or Class B Common Shares issued subsequent thereto,
until the Distribution Date, the Rights will be evidenced by such certificates
registered in the names of the holders thereof. Until the Distribution Date
(or earlier redemption or expiration of the Rights), the surrender for transfer
of any certificate for Common Shares or Class B Common Shares (whether or not
such certificate was outstanding on July 18, 1995) shall also constitute the
transfer of the Rights associated with the Common Shares or Class B Common
Shares represented thereby.
(c) Certificates for Common Shares or Class B Common
Shares issued (including, without limitation, any certificates for Common
Shares issued upon exercise of stock options) or surrendered for transfer or
exchange after July 18, 1995 but prior to the earliest of the Distribution
Date, the Expiration Date or the Final Expiration Date (as such terms are
defined in Section 7), shall have stamped on, impressed on, printed on, written
on or otherwise affixed to them the following legend or such similar legend as
the Company may deem appropriate and as is not inconsistent with the provisions
of this Agreement, or as may be required to comply with any applicable law or
with any rule or regulation made pursuant thereto or with any rules or
regulation of the National Association of Securities Dealers, Inc. or of any
stock exchange on which the Rights may from time to time be listed, or to
conform to usage:
This Certificate also evidences and entitles the holder hereof
to certain Rights as set forth in a Rights Agreement between
Invacare Corporation and National City Bank, dated as of July
7, 1995 (the "Rights Agreement"), the terms of which are
hereby incorporated herein by reference and a copy of which is
on file at the principal executive offices of Invacare
Corporation. Under certain circumstances, as set forth in the
Rights Agreement, such Rights will be evidenced by separate
certificates and
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will no longer be evidenced by this Certificate. Invacare Corporation
will mail to the holder of this Certificate a copy of the Rights
Agreement without charge within five business days after receipt of a
written request therefor. Under certain circumstances, Rights issued
to Acquiring Persons (as defined in the Rights Agreement) may become
null and void.
Until the Distribution Date, Rights associated with Common Shares or Class B
Common Shares of the Company (whether or not represented by certificates
bearing the above legend) shall be evidenced by such certificates alone, and
the surrender for transfer of any such certificate shall also constitute the
surrender for transfer of the Rights associated with the Common Shares or Class
B Common Shares represented thereby.
Section 4. FORM OF RIGHT CERTIFICATES.
The Right Certificates (and the forms of election to purchase shares
and of assignment to be printed on the reverse thereof) shall be substantially
the same as Exhibit A hereto with such changes, marks of identification or
designation and such legends, summaries or endorsements printed thereon as the
Company may deem appropriate and as are not inconsistent with the provisions of
this Agreement, or as may be required to comply with any applicable law or with
any rule or regulation made pursuant thereto or with any rule or regulation of
the National Association of Securities Dealers, Inc. or of any stock exchange
on which the Rights may from time to time be listed, or to conform to usage.
Subject to the provisions of Section 22 hereof, the Right Certificates,
whenever issued, shall be dated as of July 18, 1995, and on their face shall
entitle the holders thereof to purchase such number of Common Shares as shall
be set forth therein at the price per one-tenth share set forth therein (the
"Purchase Price"), but the number of such shares and the Purchase Price shall
be subject to adjustment as provided herein.
Section 5. COUNTERSIGNATURE AND REGISTRATION.
The Right Certificates shall be executed on behalf of the Company by
its Chairman of the Board, President or any Vice President, either manually or
by facsimile signature, which shall be attested by the Secretary or an
Assistant Secretary of the Company, either manually or by facsimile signature.
The Right Certificates shall be manually countersigned by the Rights Agent and
shall not be valid for any purpose unless so countersigned. In case any
officer of the Company 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 the Rights Agent, and issued and
delivered by
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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 Certificate may be signed on behalf of the Company by any person who, at
the actual date of the execution of such Right Certificate, shall be a proper
officer of the Company to sign such Right Certificate, although at the date of
the execution of this Rights Agreement any such person was not such an officer.
Following the Distribution Date, the Rights Agent will keep or cause
to be kept, at one of its offices in Cleveland, Ohio, 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.
Subject to the provisions of 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 earlier of the Expiration Date or the Final Expiration Date (as
such terms are defined in Section 7), any Right Certificate or Certificates may
be transferred, split up, combined or exchanged for another Right Certificate
or Right Certificates, entitling the registered holder to purchase a like
number of one-tenths of Common Shares as the Right Certificate or Right
Certificates surrendered then entitled such holder to purchase. Any registered
holder desiring to transfer, split up, combine or exchange any Right
Certificate shall make such request in writing delivered to the Rights Agent,
and shall surrender the Right Certificate or Right Certificates to be
transferred, split up, combined or exchanged at the principal office of the
Rights Agent. Thereupon the Rights Agent shall countersign and deliver to the
person entitled thereto a Right Certificate or Right Certificates, as the case
may be, as so requested. The Company may require payment of a sum sufficient
to cover any tax or governmental charge that may be imposed in connection with
any transfer, split up, combination or exchange of Right Certificates.
Any person claiming a Right Certificate to have been lost, stolen,
destroyed or mutilated shall make an affidavit or affirmation of that fact,
shall give the Company and the Rights Agent a bond of indemnity satisfactory to
the Directors or to the Chairman of the Board, the President, any Vice
President or the Treasurer of the Company and, if required by the Directors or
any of such officers, shall advertise the same in such manner as may be
required, and upon surrender to the Rights Agent and cancellation of the Right
Certificate if mutilated, the Company will make and
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deliver a new Right Certificate of like tenor to the Rights Agent for delivery
to the registered owner in lieu of the Right Certificate so lost, stolen,
destroyed or mutilated.
Section 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION
DATE OF RIGHTS.
(a) The registered holder of any Right Certificate may
exercise the Rights evidenced thereby (except as otherwise provided herein) in
whole or in part at any time after the Distribution Date upon surrender of the
Right Certificate, with the form of election to purchase on the reverse side
thereof duly executed, to the Rights Agent at the principal office of the
Rights Agent in Cleveland, Ohio, together with payment of the aggregate
Purchase Price for the total number of one-tenths of Common Shares as to which
the Rights are exercised, at or prior to the close of business on the earlier
of (i) July 7, 2005 (the "Final Expiration Date"), or (ii) the date on which
the Rights are redeemed as provided in Section 23 hereof (such earlier date
being herein referred to as the "Expiration Date").
(b) The Purchase Price for each one-tenth Common Share
pursuant to the exercise of a Right shall initially be $16, shall be subject to
adjustment from time to time as provided in Section 11 hereof and shall be
payable in lawful money of the United States of America in accordance with
paragraph (c) below.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase duly executed,
accompanied by payment of the aggregate Purchase Price for the total number of
one-tenths of Common Shares to be purchased and an amount equal to any
applicable transfer tax in cash, or by certified check or bank draft payable to
the order of the Rights Agent, the Rights Agent shall thereupon promptly (i)
requisition from any transfer agent of the Common Shares (or make available, if
the Rights Agent is the transfer agent) certificates for the number of whole
Common Shares to be purchased and the Company hereby irrevocably authorizes its
transfer agent to comply with all such requests, (ii) when appropriate,
requisition from the Company the amount of cash to be paid in lieu of issuance
of fractional shares in accordance with Section 14 or in lieu of issuance of
Common Shares in accordance with Sections 11(a)(iii) or 11(d), (iii) promptly
after receipt of such certificates, cause the same to be delivered to or upon
the order of the registered holder of such Right Certificate, registered in
such name or names as may be designated by such holder and (iv) when
appropriate, after receipt promptly deliver such cash to or upon the order of
the registered holder of such Right Certificate.
(d) In case the registered holder of any Right
Certificate shall exercise less than all the Rights evidenced thereby, a new
Right Certificate evidencing Rights equivalent to
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the Rights remaining unexercised shall be issued by the Rights Agent to the
registered holder of such Right Certificate or to his or her duly authorized
assigns, subject to the provisions of Section 14 hereof.
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 to any of its stock transfer agents, be delivered to the Rights
Agent for cancellation or in cancelled form, or, if surrendered to the Rights
Agent, shall be cancelled by it, and no Right Certificates shall be issued in
lieu thereof except as expressly permitted by 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 cancelled Right
Certificates to the Company, or shall, at the written request of the Company,
destroy such cancelled Right Certificates, and in such case shall deliver a
certificate of destruction thereof to the Company.
Section 9. RESERVATION AND AVAILABILITY OF COMMON SHARES.
The Company covenants and agrees that it will cause to be reserved and
kept available out of its authorized and unissued Common Shares and/or any
authorized and issued Common Shares held in its treasury, the number of Common
Shares that will be sufficient to permit the exercise pursuant to Section 7
hereof of all outstanding Rights; such number of Common Shares reserved and
kept available shall be adjusted from time to time, if and to the extent
required, upon the occurrence of any of the events described in Section 11
hereof.
The Company covenants and agrees that it will take all such action as
may be necessary to ensure that all Common Shares delivered upon exercise of
Rights shall be, at the time of delivery of the certificates for such shares
(subject to payment of the Purchase Price), duly and validly authorized and
issued and fully paid and nonassessable shares.
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 Common Shares 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 the
issuance or delivery of certificates for the Common Shares in a
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name other than that of, the registered holder of the Right Certificate
evidencing Rights surrendered for exercise or to issue or deliver any
certificates for Common Shares upon the exercise of any Rights until any 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. COMMON SHARES RECORD DATE.
Each person in whose name any certificate for Common Shares is issued
upon the exercise of Rights shall for all purposes be deemed to have become the
holder of record of the Common Shares 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 aggregate
Purchase Price for the total number of one-tenths of Common Shares as to which
the Rights were exercised (and any applicable transfer taxes) was made;
PROVIDED, HOWEVER, that if the date of such surrender and payment is a date
upon which the Common Shares 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
Common Shares transfer books of the Company are open. Prior to the exercise of
the Rights evidenced thereby, the holder of a Right Certificate shall not be
entitled to any rights of a 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 PURCHASE PRICE, NUMBER AND TYPE OF
SHARES OR NUMBER OF RIGHTS.
The Purchase Price, the number and type 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 that the Company shall at any
time after the date of this Agreement (A) declare a dividend on the Common
Shares payable in Common Shares, (B) subdivide the outstanding Common Shares,
(C) combine the outstanding Common Shares into a smaller number of shares or
(D) issue any shares of its capital stock in a reclassification of the Common
Shares (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) or in Section 11(d), the
Purchase Price in effect at the time of the record date for such dividend or of
the effective date of such subdivision, combination or reclassification, and
the
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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 Common Shares transfer books of the Company were
open, he would have owned upon such exercise and been entitled to receive by
virtue of such dividend, subdivision, combination or reclassification. If an
event occurs which would require an adjustment under both Section 11(a)(i) and
Section 11(a)(ii) or Section 11(d), 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) or Section 11(d).
(ii) In the event that
(A) any Acquiring Person or any
Associate or Affiliate of any Acquiring Person, at any time after the
date of this Agreement, directly or indirectly, shall (1) merge into
the Company or otherwise combine with the Company and the Company
shall be the continuing or surviving corporation of such merger or
combination, other than in a transaction subject to Section 11(d)(ii),
(2) merge or otherwise combine with any Subsidiary, (3) in one or more
transactions, transfer any assets to the Company or any Subsidiary in
exchange (in whole or in part) for Common Shares or Class B Common
Shares, securities exercisable for or convertible into Common Shares
or Class B Common Shares or securities of any Subsidiary, or otherwise
obtain from the Company or any Subsidiary, with or without
consideration, any additional Common Shares or Class B Common Shares,
securities exercisable for or convertible into Common Shares or Class
B Common Shares or securities of any Subsidiary (other than as part of
a pro rata distribution to all holders of Common Shares or Class B
Common Shares), (4) sell, purchase, lease, exchange, mortgage, pledge,
transfer or otherwise dispose of (in one or more transactions), to,
from or with, as the case may be, the Company or any Subsidiary, other
than in a transaction subject to Section 11(d), assets on terms and
conditions less favorable to the Company than the Company would be
able to obtain in arm's-length negotiation with an unaffiliated third
party, (5) receive any compensation from the Company or any Subsidiary
other than compensation for full-time employment as a regular employee
at rates in accordance with the Company's (or its Subsidiaries') past
practices, or (6) receive the benefit, directly or indirectly (except
proportionately as a stockholder), of any loans, advances, guarantees,
pledges or other financial assistance or any tax credits or other tax
advantage provided by the Company or any Subsidiaries, or
(B) during such time as there is an
Acquiring Person, there shall be any reclassification of securities
(including any reverse stock split), or recapitalization of the
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Company, or any merger or consolidation of the Company with any
Subsidiary or any other transaction or series of transactions (whether
or not with or into or otherwise involving an Acquiring Person), other
than a transaction subject to Section 11(d), which has the effect,
directly or indirectly, of increasing by more than 1% the
proportionate share of the total voting power of the Company or any
Subsidiary which is directly or indirectly beneficially owned by any
Acquiring Person or any Associate or Affiliate of any Acquiring
Person,
then, and in each such case, proper provision shall be made so that each holder
of a Right, except as provided below, shall thereafter have a right to receive,
upon exercise thereof at the then-current Purchase Price in accordance with the
terms of this Agreement, such number of Common Shares as shall equal the result
obtained by (x) multiplying the then-current Purchase Price by the then number
of one-tenths of Common Shares for which a Right is then exercisable and
dividing that product by (y) 50% of the current per share market price of the
Common Shares (determined pursuant to Section 11(e)) on the date of the
occurrence of any one of the events listed above in this subparagraph (ii).
Notwithstanding the foregoing, upon the occurrence of any of the events listed
above in this subparagraph (ii), any Rights that are or were at any time
beneficially owned by any Acquiring Person or any Associate or Affiliate of the
Acquiring Person (which Acquiring Person, Associate or Affiliate is engaging in
one or more of the transactions set forth in subparagraph (ii)(A) above, or
realizing the benefit set forth in subparagraph (ii)(B) above, as the case may
be) after the date upon which such Acquiring Person became such shall become
void and any holder of such Rights shall thereafter have no right to exercise
such Rights under any provisions of this Agreement.
(iii) In the event that there shall not be
sufficient authorized but unissued Common Shares and/or authorized and issued
Common Shares held in Treasury to permit the exercise in full of the Rights in
accordance with the foregoing subparagraph (ii), the Company shall take all
such action as may be necessary to authorize additional Common Shares for
issuance upon exercise of the Rights; PROVIDED, HOWEVER, if the Company is
unable to cause the authorization of additional Common Shares then,
notwithstanding any other provision of this Agreement, the Company, with
respect to each Right for which Common Shares are not available for issuance
and to the extent necessary, shall, upon the exercise of any such Right, and in
lieu of issuing Common Shares and requiring payment therefor, pay an amount in
cash equal to the Purchase Price. To the extent that any legal or contractual
restrictions prevent the Company from paying the full amount of cash payable in
accordance with the foregoing sentence, the Company shall pay to holders of the
Rights as to which such payments are being made all amounts which are not then
restricted on a pro rata basis. The Company
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shall continue to make payments on a pro rata basis as funds become available
until such payments have been paid in full.
(b) In the event that the Company shall fix a record date
for the issuance of rights or warrants to all holders of Common Shares or Class
B Common Shares entitling them (for a period expiring within 45 calendar days
after such record date) to subscribe for or purchase Common Shares or Class B
Common Shares (or securities convertible into Common Shares or Class B Common
Shares) at a price per Common Share or Class B Common Share (or having a
conversion price per Common Share or Class B Common Share, if a security
convertible into Common Shares or Class B Common Shares) less than the current
per share market price of the Common Shares (as defined in Section 11(e)) on
such record date, the Purchase Price to be in effect after such record date
shall be determined by multiplying the Purchase Price in effect immediately
prior to such record date by a fraction, the numerator of which shall be the
number of Common Shares and Class B Common Shares outstanding on such record
date plus the number of Common Shares which the aggregate offering price of the
total number of Common Shares and Class B Common Shares so to be offered
(and/or the aggregate initial conversion price of the convertible securities so
to be offered) would purchase at such current market price and the denominator
of which shall be the number of Common Shares and Class B Common Shares
outstanding on such record date plus the number of additional Common Shares and
Class B Common Shares to be offered for subscription or purchase (or into which
the convertible securities so to be offered are initially convertible). In
case such subscription price may be paid in a consideration part or all of
which shall be in a form other than cash, the value of such consideration shall
be as determined in good faith by the Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent.
Common Shares or Class B Common Shares owned by or held for the account of the
Company shall not be deemed outstanding for the purpose of any such
computation. Such adjustment shall be made successively whenever such a record
date is fixed; and in the event that such rights or warrants are not so issued,
the Purchase Price shall be adjusted to be the Purchase Price which would then
be in effect if such record date had not been fixed.
(c) In the event that the Company shall fix a record date
for the making of a distribution to all holders of the Common Shares or Class B
Common Shares (including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing or surviving
corporation) of evidences of indebtedness, cash (other than a regular quarterly
cash dividend), assets (other than a dividend payable in Common Shares or Class
B Common Shares but including any dividend payable in shares other than Common
Shares or Class B Common Shares) or subscription rights or warrants (excluding
those referred to in Section 11(b)), the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price in
effect immediately
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prior to such record date by a fraction, the numerator of which shall be the
current per share market price of the Common Shares (as defined in Section
11(e)) on such record date, less the fair market value (as determined in good
faith by the Directors of the Company, whose determination shall be described
in a statement filed with the Rights Agent) of the portion of the assets, cash
or evidences of indebtedness so to be distributed (in the case of cash
dividends in excess of the amounts permitted above, only such excess portion)
or of such subscription rights or warrants applicable to one Common Share or
one Class B Common Share and the denominator of which shall be such current per
share market price of the Common Shares. Such adjustments shall be made
successively whenever such a record date is fixed; and in the event that such
distribution is not so made, the Purchase Price shall again be adjusted to be
the Purchase Price which would then be in effect if such record date had not
been fixed.
(d) In the event that, directly or indirectly, (i) the
Company shall consolidate with, or merge with or into, any Acquiring Person or
any Associate or Affiliate of any Acquiring Person and the Company shall not be
the continuing or surviving corporation of such merger or combination, (ii) any
Acquiring Person or any Associate or Affiliate of any Acquiring Person shall
consolidate with the Company, or merge with or into the Company and the Company
shall be the continuing or surviving corporation of such merger or
consolidation and, in connection with such merger or consolidation, all or part
of the Common Shares or Class B Common Shares shall be changed into or
exchanged for stock or other securities of such other Person or cash or any
other property, or (iii) the Company shall sell or otherwise transfer (or one
or more Subsidiaries shall sell or otherwise transfer), in one or more
transactions, assets or earning power aggregating more than 50% of the assets
or earning power of the Company and its Subsidiaries (taken as a whole) to any
Acquiring Person or any Associate or Affiliate of any Acquiring Person in a
transaction not covered by Section 11(a)(ii), then, and in each such case,
proper provision shall be made so that (A) each holder of a Right shall
thereafter have the right to receive, upon the exercise thereof at the
then-current Purchase Price in accordance with the terms of this Agreement,
such number of fully-paid and freely tradeable Common Shares of the Principal
Party (as hereafter defined) not subject to any adverse claims, as shall be
equal to the result obtained by (x) multiplying the then-current Purchase Price
by the number of one-tenths of Common Shares for which a Right is then
exercisable and dividing that product by (y) 50% of the current per share
market price of the Common Shares of such Principal Party (determined pursuant
to Section 11(e)) immediately prior to the consummation of such consolidation,
merger, sale or transfer; (B) such Principal Party shall thereafter be liable
for, and shall assume, by virtue of such consolidation, merger, sale or
transfer, all the obligations and duties of the Company pursuant to this
Agreement; (C) the term "Company" shall thereafter be deemed to refer to such
Principal Party; (D) such Principal Party shall take such steps
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(including, but not limited to, the reservation of a sufficient number of its
Common Shares in accordance with Section 9) 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
Common Shares thereafter deliverable upon the exercise of the Rights; and (E)
the provisions of Section 11(a)(ii) hereof shall be of no effect following the
consummation of any such merger, consolidation, sale or transfer. For purposes
of this Agreement, "Principal Party" shall mean (1) in the case of any
transaction described in (i) or (ii) of this Section 11(d), the Person that is
the issuer of any securities into which Common Shares or Class B Common Shares
of the Company are converted in such merger or consolidation, and if no
securities are so issued, the Person that is the other party to the merger or
consolidation; and (2) in the case of any transaction described in (iii) of
this Section 11(d), the Person that is the party receiving the greatest portion
of the assets or earning power transferred pursuant to such transaction or
transactions; PROVIDED, HOWEVER, that in connection with either subsection (1)
or (2) of this sentence, (w) if the Common Shares of such Person are not at
such time and have not been continuously over the preceding 12-month period
registered under Section 12 of the Exchange Act, and such Person is a direct or
indirect subsidiary of another Person the Common Shares of which are and have
been so registered, "Principal Party" shall refer to such other Person; and (x)
in case such Person is a subsidiary, directly or indirectly, of more than one
Person, the Common Shares of two or more of which are and have been so
registered, "Principal Party" shall refer to whichever of such Persons is the
issuer of the Common Shares having the greatest aggregate market value. The
Company shall not consummate any of the transactions listed above in
subparagraphs (i) through (iii), inclusive, unless prior thereto the Company
and the Principal Party shall have executed and delivered to the Rights Agent a
supplemental agreement providing for the terms set forth in this Section 11(d)
and further providing that, as soon as practicable after the date of any
consolidation, merger, sale or transfer of assets mentioned in subparagraphs
(i)-(iii) above, the Principal Party at its own expense will
(1) prepare and file a registration statement
under the Securities Act of 1933, as amended (the "Act"), with
respect to the Rights and the securities issuable upon
exercise of the Rights on an appropriate form, will use its
best efforts to cause such registration statement to become
effective as soon as practicable after such filing and will
use its best efforts to cause such registration statement to
remain effective (with a prospectus at all times meeting the
requirements of the Act) until the earlier of the Expiration
Date or the Final Expiration Date;
(2) use its best efforts to qualify or register
the Rights and the securities issuable upon exercise of the
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Rights under the blue sky laws of such jurisdictions as may be
necessary or appropriate; and
(3) deliver to holders of the Rights historical
financial statements for the Principal Party and each of its
Affiliates which comply in all material respects with the
requirements for registration on Form 10 under the Exchange
Act.
In the event that there shall not be sufficient authorized but
unissued Common Shares of the Principal Party or authorized and issued Common
Shares of the Principal Party held in treasury to permit the exercise in full
of the Rights in accordance with this Section 11(d), the Principal Party shall
take all such action as may be necessary to authorize additional Common Shares
for issuance upon exercise of the Rights; PROVIDED, HOWEVER, if the Principal
Party is unable to cause the authorization of additional Common Shares then,
notwithstanding any other provision of this Agreement, the Principal Party with
respect to each Right for which Common Shares are not available for issuance
and to the extent necessary, shall upon the exercise of any such Right, and in
lieu of issuing Common Shares and requiring payment therefor, pay an amount in
cash equal to the Purchase Price. To the extent that any legal or contractual
restrictions prevent the Principal Party from paying the full amount of cash
payable in accordance with the foregoing sentence, the Principal Party shall
pay to holders of the Rights as to which such payments are being made all
amounts which are not then restricted on a pro rata basis. The Principal Party
shall continue to make payments on a pro rata basis as funds become available
until such payments have been paid in full.
Notwithstanding the foregoing, upon the occurrence of any of the
events listed above in subparagraphs (i) through (iii), inclusive, any Rights
that are or were at any time beneficially owned by the Acquiring Person or any
Associate or Affiliate of the Acquiring Person (which Acquiring Person,
Associate or Affiliate is engaging in one or more of the transactions set forth
in subparagraphs (i) through (iii), inclusive, above) after the date upon which
such Acquiring Person became such shall become void and any holder of such
Rights shall thereafter have no right to exercise such Rights under any
provision of this Agreement.
The provisions of this Section 11(d) shall similarly apply to
successive mergers or consolidations or sales or other transfers.
(e) For the purpose of any computation hereunder, the
"current per share market price" of Common Shares on any date shall be deemed
to be the average of the daily closing prices per share of such Common Shares
for the thirty (30) consecutive Trading Days (as such term is hereinafter
defined) immediately prior to such date; PROVIDED, HOWEVER, that in the event
that the current per share market price of the Common Shares is determined
during a
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period following the announcement by the issuer of such Common Shares (i) of a
dividend or distribution on such Common Shares payable in such Common Shares or
securities convertible into such Common Shares or (ii) any subdivision,
combination or reclassification of such Common Shares, and prior to the
expiration of thirty (30) Trading Days after the ex-dividend date for such
dividend or distribution or the record date for such subdivision, combination
or reclassification, then, and in each such case, the "current market price"
shall be appropriately 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 Common Shares are
not listed or admitted to trading on the New York Stock Exchange, as reported
in the principal consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange on which the
Common Shares are listed or admitted to trading or, if the Common Shares are
not listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by the National Association
of Securities Dealers, Inc. Automated Quotation System ("NASDAQ") or such other
system then in use, or, if on any such date the Common Shares are not quoted by
any such organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the Common Shares
selected by the Directors of the Company. If on any such date no market maker
is making a market in the Common Shares, the fair value of such shares on such
date as determined in good faith by the Directors of the Company shall be used.
The term "Trading Day" shall mean any day on which the principal national
securities exchange on which the Common Shares are listed or admitted to
trading is open for the transaction of business or, if the Common Shares are
not listed or admitted to trading on any national securities exchange, a
Business Day. If the Common Shares are not publicly held or not so listed or
traded, "current per share market price" shall mean the fair value per share as
determined in good faith by the Directors of the Company, whose determination
shall be described in a statement filed with the Rights Agent.
(f) No adjustment in the Purchase Price shall be required
unless such adjustment would require an increase or decrease of at least 1% in
such price; PROVIDED, HOWEVER, that any adjustments which by reason of this
Section 11(f) 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 thousandth of a share as
the case may be.
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(g) If as a result of an adjustment made pursuant to
Section 11(a), the holder of any Right thereafter exercised shall become
entitled to receive any shares of capital stock of the Company other than
Common Shares, 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 Common Shares contained in Sections 11(a) through (d),
inclusive, and the provisions of Sections 7, 9 and 10 with respect to the
Common Shares shall apply on like terms to any such other shares.
(h) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder shall
evidence the right to purchase, at the adjusted Purchase Price, the number of
one-tenths of Common Shares purchasable from time to time hereunder upon
exercise of the Rights, all subject to further adjustment as provided herein.
(i) Unless the Company shall have exercised its election
as provided in Section 11(j), upon each adjustment of the Purchase Price as a
result of the calculations made in Sections 11(b) and (c), each Right
outstanding immediately prior to the making of such adjustment shall thereafter
evidence the right to purchase, at the adjusted Purchase Price, that number of
one-tenths of a Common Share (calculated to the nearest thousandth) obtained by
(i) multiplying (x) the number of one-tenths of a Common Share covered by a
Right immediately prior to such adjustment by (y) the Purchase Price in effect
immediately prior to such adjustment of the Purchase Price and (ii) dividing
the product so obtained by the Purchase Price in effect immediately after such
adjustment of the Purchase Price.
(j) The Company may elect, on or after the date of any
adjustment of the Purchase Price, to adjust the number of Rights in
substitution for any adjustment in the number of one-tenths of a Common Share
purchasable upon the exercise of a Right. Each of the Rights outstanding after
such adjustment of the number of Rights shall be exercisable for the number of
one-tenths of a Common Share 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 thousandth) obtained by dividing the Purchase Price in effect
immediately prior to adjustment of the Purchase Price by the Purchase Price in
effect immediately after adjustment of the Purchase Price. The Company shall
make a public announcement of its election to adjust the number of Rights,
indicating the record date for the adjustment, and, if known at the time, the
amount of the adjustment to be made. This record date may be the date on which
the Purchase Price is adjusted or any day thereafter, but, if the Right
Certificates have been issued, shall be at least ten (10) calendar days later
than the date of the public announcement. If Right Certificates have been
issued, upon each adjustment of the
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number of Rights pursuant to this Section 11(j), the Company shall, as promptly
as practicable, cause to be distributed to holders of record of Right
Certificates on such record date Right Certificates evidencing, subject to
Section 14, the additional Rights to which such holders shall be entitled as a
result of such adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment. Right Certificates so to be distributed shall be issued, executed
and countersigned in the manner provided for herein (and may bear, at the
option of the Company, the adjusted Purchase Price) and shall be registered in
the names of the holders of record of Right Certificates on the record date
specified in the public announcement.
(k) Irrespective of any adjustment or change in the
Purchase Price or the number or type of one-tenths of Common Shares issuable
upon the exercise of the Rights, the Right Certificates theretofore and
thereafter issued may continue to express the Purchase Price per share and the
number of one-tenths of a Common Share which were expressed in the initial
Right Certificate issued hereunder.
(l) In any case in which this Section 11 shall require
that an adjustment in the Purchase Price be made effective as of a record date
for a specified event, the Company may elect to defer until the occurrence of
such event the issuing to the holder of any Right exercised after such record
date the Common Shares and other capital stock or securities of the Company, if
any, issuable upon such exercise over and above the Common Shares and other
capital stock or securities of the Company, if any, issuable upon such exercise
on the basis of the Purchase Price in effect prior to such adjustment;
PROVIDED, HOWEVER, that the Company shall deliver to such holder a due bill or
other appropriate instrument evidencing such holder's right to receive such
additional shares upon the occurrence of the event requiring such adjustment.
(m) Anything in Sections 11(a) through (l), inclusive,
hereof to the contrary notwithstanding, the Company shall be entitled to make
such reductions in the Purchase Price, in addition to those adjustments
expressly required by this Section 11, as and to the extent that it in its sole
discretion shall determine to be advisable in order that any consolidation or
subdivision of the Common Shares or Class B Common Shares, issuance wholly for
cash of any of the Common Shares or Class B Common Shares, at less than the
current market price of the Common Shares, issuance wholly for cash of Common
Shares or Class B Common Shares, or securities which by their terms are
convertible into or exchangeable for Common Shares or Class B Common Shares,
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
Common Shares or
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Class B Common Shares, shall not be taxable to such shareholders.
(n) Notwithstanding any other provision of this
Agreement, no adjustment to the Purchase Price, the number of one-tenths of a
Common Share for which a Right is exercisable or the number of Rights
outstanding shall be made or be effective if such adjustment would have the
effect of reducing or limiting the benefits the holders of the Rights would
have had absent such adjustment, including, without limitation, the benefits
under Sections 11(a)(ii) and 11(d) hereof, unless the terms of this Agreement
are amended so as to preserve such benefits.
Section 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER OF
SHARES.
Whenever an adjustment is made as provided in Section 11, the Company
shall promptly prepare a certificate setting forth such adjustment, (including
a description of any Rights which have become void as a result thereof), and a
brief statement of the facts accounting for such adjustment and promptly file
with the Rights Agent and with each transfer agent for the Common Shares a copy
of such certificate.
Section 13. NOTICE OF ADJUSTED PURCHASE PRICE OR NUMBER OR TYPE
OF SHARES TO HOLDERS OF RIGHTS.
Whenever an adjustment is made as provided in Section 11 after the
Distribution Date, the Company shall mail a brief summary of such adjustment to
each holder of a Right Certificate in accordance with Section 25.
Section 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) The Company shall not be required to issue fractions
of Rights or to distribute Right Certificates which evidence fractional Rights.
In lieu of such fractional Rights, there shall be paid as promptly as
practicable to the registered holders of the Right Certificates with regard to
which such fractional Rights would otherwise be issuable, an amount in cash
equal to the same fraction of the current market value of a whole Right. For
the purposes of this Section 14(a), the current market value of a whole Right
shall be the closing price of the Rights for the Trading Day immediately prior
to the date on which such fractional Rights would have been otherwise issuable.
The closing price for any day shall be the last sale price, regular way, or, in
case no such sale takes place on such day, the average of the closing bid and
asked prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock
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Exchange or, if the Rights are not listed or admitted to trading on the New
York Stock Exchange, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal national
securities exchange on which the Rights are listed or admitted to trading or,
if the Rights are not listed or admitted to trading on any national securities
exchange, the last quoted price or, if not so quoted, the average of the high
bid and low asked prices in the over-the-counter market, as reported by NASDAQ
or such other system then in use or, if on any such date the Rights are not
quoted by any such organization, the average of the closing bid and asked
prices as furnished by a professional market maker making a market in the
Rights selected by the Directors of the Company. If on any such date no such
market maker is making a market in the Rights the fair value of the Rights on
such date as determined in good faith by the Directors of the Company shall be
used.
(b) The Company shall not be required to issue fractions
of Common Shares upon exercise of the Rights or to distribute certificates
which evidence fractional shares. In lieu of fractional shares, 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 current market value of one Common Share. For purposes of this Section
14(b), the current market value of a Common Share shall be the closing price of
a Common Share (as determined pursuant to the second sentence of Section 11(e))
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.
Section 15. RIGHTS OF ACTION.
All rights of action in respect of this Agreement are vested in the
respective registered holders of the Right Certificates (and, prior to the
Distribution Date, the registered holders of the Common Shares and/or Class B
Common Shares); and any registered holder of any Right Certificate (or, prior
to the Distribution Date, of the Common Shares and/or Class B Common Shares),
without the consent of the Rights Agent or of the holder of any other Right
Certificate (or, prior to the Distribution Date, of the Common Shares and/or
Class B Common Shares), may, in his own behalf and for his own benefit,
enforce, and may institute and maintain any suit, action or proceeding against
the Company to enforce, or otherwise act in respect of, his right to exercise
the Rights evidenced by such Right Certificate in the manner provided in such
Right Certificate and in this Agreement. Without limiting the foregoing or any
remedies available to the holders of Rights, it is specifically acknowledged
that the holders of Rights would not have an adequate remedy at law for any
breach of this Agreement and will
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be entitled to specific performance of the obligations under, and injunctive
relief against actual or threatened violations of, the obligations of any
Person subject to this Agreement.
Section 16. AGREEMENT OF RIGHTS HOLDERS.
Every holder of a Right by accepting the same consents and agrees with
the Company and the Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common Shares and
Class B Common Shares;
(b) after the Distribution Date, the Right Certificates
are transferable only on the registry books of the Rights Agent if surrendered
at the principal office of the Rights Agent, duly endorsed or accompanied by a
proper instrument of transfer; and
(c) the Company and the Rights Agent may deem and treat
the person in whose name the Right Certificate (or, prior to the Distribution
Date, the associated Common Share or Class B Common Share certificate) is
registered as the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the Right
Certificates or the associated Common Share or Class B Common Share certificate
made by anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent shall be affected by
any notice to the contrary.
Section 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 Common
Shares 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 24), or to
receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Right Certificate shall have been exercised in
accordance with the provisions hereof.
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<PAGE> 26
Section 18. CONCERNING THE RIGHTS AGENT.
The Company agrees to pay to the Rights Agent reasonable compensation
for all services rendered by it hereunder and, from time to time, on demand of
the Rights Agent, its reasonable expenses and counsel fees and other
disbursements incurred in the administration and execution of this Agreement
and the exercise and performance of its duties hereunder. The Company also
agrees to indemnify the Rights Agent for, and to hold it harmless against, any
loss, liability, or expense, incurred without negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything done or omitted by the
Rights Agent in connection with the acceptance and administration of this
Agreement, including the costs and expenses of defending against any claim of
liability.
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 for the Common Shares, Class B Common Shares 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 to be genuine and to be
signed, executed and, where necessary, verified or acknowledged, by the proper
person or persons.
Section 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS
AGENT.
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 business of the Rights Agent or any successor Rights Agent,
shall be the successor to the Rights Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation would be eligible for
appointment as a successor Rights Agent under the provisions of Section 21. In
case at the time such successor Rights Agent shall succeed to the agency
created by this Agreement, any of the Right Certificates shall have been
countersigned but not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Right
Certificates so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Right Certificates either in the name of the predecessor
Rights Agent or in the name of the successor Rights Agent; and in all such
cases such Right Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
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In case at any time the name of the Rights Agent shall be changed and
at such time any of the Right Certificates shall have been countersigned but
not delivered, the Rights Agent may adopt the countersignature under its prior
name and deliver Right Certificates so countersigned; and in case at that time
any of the Right Certificates shall not have been countersigned, the Rights
Agent may countersign such Right Certificates either in its prior name or in
its changed name; and in all such cases such Right Certificates shall have the
full force provided in the Right Certificates and in this Agreement.
Section 20. DUTIES OF RIGHTS AGENT.
The Rights Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions, by all of which the Company
and the holders of Right Certificates, by their acceptance thereof, shall be
bound:
(a) The Rights Agent may consult with legal counsel (who
may be legal counsel for the Company), and the opinion of such counsel shall be
full and complete authorization and protection to the Rights Agent as to any
action taken or omitted by it in good faith and in accordance with such
opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that any fact
or matter be proved or established by the Company prior to taking or suffering
any action hereunder, such fact or matter (unless other evidence in respect
thereof be herein specifically prescribed) may be deemed to be conclusively
proved and established by a certificate signed by any one of the Chairman of
the Board, the President, any Vice President, the Treasurer, the Secretary or
any Assistant Secretary of the Company and delivered to the Rights Agent; and
such certificate shall be full authorization to the Rights Agent for any action
taken or suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for
its own negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason
of any of the statements of fact or recitals contained in this Agreement or in
the Right Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be deemed
to have been made by the Company only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or the execution
and delivery hereof (except the due execution hereof by the Rights Agent) or in
respect of the validity or execution of any
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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 adjustment required under the provisions of Section 11
(including any adjustment which results in Rights becoming void) or responsible
for the manner, method or amount of any such adjustment or the ascertaining of
the existence of facts that would require any such adjustment (except with
respect to the exercise of Rights evidenced by Right Certificates after actual
notice of any such adjustment or voidance); nor shall it by any act hereunder
be deemed to make any representation or warranty as to the authorization or
reservation of any Common Shares to be issued pursuant to this Agreement or any
Right Certificate or as to whether any Common Shares will, when issued, be
validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying out or performing
by the Rights Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties hereunder
from any one of the Chairman of the Board, the President, any Vice President or
the Treasurer of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable for any
action taken or suffered to be taken by it in good faith in accordance with
instructions of any such officer.
(h) The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal in any of the
Rights or other securities of the Company or become pecuniarily interested in
any transaction in which the Company may be interested, or contract with or
lend money to the Company or otherwise act as fully and freely as though it
were not Rights Agent under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or for any other
legal entity.
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder either
itself or by or through its attorneys or agents, and the Rights Agent shall not
be answerable or accountable for any act, default, neglect or misconduct of any
such attorneys or agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct, provided reasonable care was exercised in
the selection and continued employment thereof. The Rights Agent shall not be
under any duty or responsibility to insure compliance with any applicable
federal or state securities laws in connection
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with the issuance, transfer or exchange of Right Certificates, Common Shares or
Class B Common Shares.
(j) The Rights Agent shall promptly remit to the Company
any funds paid to it upon exercise of the Rights pursuant to Section 7 hereof.
Section 21. CHANGE OF RIGHTS AGENT.
The Rights Agent or any successor Rights Agent may resign and be
discharged from its duties under this Agreement upon 30 days' notice in writing
mailed to the Company and to each transfer agent of the Common Shares and Class
B Common Shares by registered or certified mail, and to the holders of the
Right Certificates by first-class mail. The Company may remove the Rights
Agent or any successor Rights Agent upon 30 days' notice in writing, mailed to
the Rights Agent or successor Rights Agent, as the case may be, and to each
transfer agent of the Common Shares and Class B Common Shares 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 30 days
after giving notice of such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Rights Agent
or by the holder of a Right Certificate (who shall, with such notice, submit
his Right Certificate for inspection by the Company), then the registered
holder of any Right Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any successor Rights
Agent, whether appointed by the Company or by such a court, shall be a
corporation organized and doing business under the laws of the United States or
of the State of Ohio, Illinois or New York (or of any other state of the United
States so long as such corporation is authorized to do business as a banking
institution in the State of Ohio, Illinois or New York), in good standing
having a principal office in the State of Ohio, Illinois or New York, which is
authorized under such laws to exercise corporate trust powers and is subject to
supervision or examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined capital and surplus of at
least $50 million. After appointment, the successor Rights Agent shall be
vested with the same powers, rights, duties and responsibilities as if it had
been originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver
any further assurance, conveyance, act or deed necessary for the purpose. Not
later than the effective date of any such appointment, the Company shall file
notice thereof in writing with the predecessor Rights Agent and each transfer
agent of the Common Shares and Class B Common Shares, and mail a notice thereof
in writing to the
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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 Directors
to reflect any adjustment or change in the Purchase Price per share and the
number or kind or class of shares or other securities or property purchasable
under the Right Certificates made in accordance with the provisions of this
Agreement.
Section 23. REDEMPTION.
(a) The Board of Directors of the Company may, at its
option, at any time prior to such time as any Person becomes an Acquiring
Person, redeem all but not less than all the then outstanding Rights at a
redemption price of $.01 per Right, such redemption price to be appropriately
adjusted to reflect any stock split, stock dividend or similar transaction
occurring after the date hereof (such redemption price being hereinafter
referred to as the "Redemption Price"). The redemption of the Rights by the
Board of Directors may be made effective at such time, on such basis and with
such conditions as the Board of Directors in its sole discretion may establish.
(b) Immediately upon the action of the Directors of the
Company ordering the redemption of the Rights pursuant to paragraph (a) of this
Section 23, 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. The Company shall promptly
give public notice of any such redemption; PROVIDED, HOWEVER, that the failure
to give, or any defect in, any such notice shall not affect the validity of
such redemption. Within 10 days after such action of the Board of Directors
ordering the redemption of the Rights, the Company shall mail a notice of
redemption to all holders of the then outstanding Rights at their last
addresses as they appear upon the registry books of the Rights Agent or, prior
to the Distribution Date, on the registry books of the transfer agent for the
Common Shares and Class B Common Shares. 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
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<PAGE> 31
any Rights at any time in any manner other than that specifically set forth in
this Section 23 hereof, and other than in connection with the purchase of
Common Shares or Class B Common Shares prior to the Distribution Date.
Section 24. NOTICE OF CERTAIN EVENTS.
In case, after the Distribution Date, the Company shall propose (a) to
pay any dividend payable in stock of any class to the holders of Common Shares
or Class B Common Shares or to make any other distribution to the holders of
Common Shares or Class B Common Shares (other than regular quarterly cash
dividends) or (b) to offer to the holders of Common Shares or Class B Common
Shares rights or warrants to subscribe for or to purchase any additional Common
Shares or Class B Common Shares or shares of stock of any class or any other
securities, rights or options, or (c) to effect any reclassification of its
Common Shares or Class B Common Shares (other than a reclassification involving
only the subdivision of outstanding Common Shares and/or Class B Common
Shares), or (d) to effect any consolidation or merger into or with, or to
effect any sale or other transfer (or to permit one or more Subsidiaries to
effect any sale or other transfer), in one or more transactions, of more than
50% of the assets or earning power of the Company and its Subsidiaries (taken
as a whole) to, any other Person, or (e) to effect the liquidation, dissolution
or winding up of the Company, then, in each such case, the Company shall give
to each holder of a Right, in accordance with Section 25, a notice of such
proposed action, which shall specify the record date for the purposes of such
stock dividend, distribution or 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 Common Shares and/or Class B Common Shares, if
any such date is to be fixed, and such notice shall be so given, in the case of
any action covered by clause (a) or (b) above, at least 20 calendar days prior
to the record date for determining holders of the Common Shares and/or Class B
Common Shares for purposes of such action, and, in the case of any such other
action, at least 20 calendar days prior to the date of the taking of such
proposed action or the date of participation therein by the holders of the
Common Shares and/or Class B Common Shares, whichever shall be the earlier.
In case any of the events set forth in Section 11(a)(ii) or Section
11(d) of this Agreement shall occur, then, in any such case, the Company shall
as soon as practicable thereafter give to the Rights Agent and each holder of a
Right, in accordance with Section 25, a notice of the occurrence of such event,
which shall specify the event and the consequences of the event to holders of
Rights under Section 11(a)(ii) or 11(d).
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Section 25. NOTICES.
Notices or demands authorized by this Agreement to be given or made by
the Rights Agent or by the holder of any Right Certificate to or on the Company
shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with the Rights
Agent) as follows:
Invacare Corporation
899 Cleveland Street
Elyria, Ohio 44036
Attention: Chief Financial Officer
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, addressed (until another address is
filed in writing with the Company) as follows:
National City Bank
P.O. Box 92301
Cleveland, Ohio 44193
Attn: Corporate Trust Administration
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company.
Section 26. SUPPLEMENTS AND AMENDMENTS.
The Company may from time to time supplement or amend this Agreement
without the approval of any holders of Right Certificates in order to cure any
ambiguity, to correct or supplement any provision contained herein which may be
defective or inconsistent with any other provisions herein, or to make any
other provisions with respect to the Rights which the Company may deem
necessary or desirable, any such supplement or amendment to be evidenced by a
writing signed by the Company and the Rights Agent; PROVIDED, HOWEVER, that
from and after such time as any Person becomes an Acquiring Person, this
Agreement shall not be amended in any manner which would adversely affect the
interests of the holders of Rights. 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 thresholds set forth in Sections 1(a)
and 3(a) to not less than the greater of (i) the sum of .001% and the largest
percentage of the total outstanding voting power then known by the Company to
be held (beneficially or otherwise) by any Person (other than the Company, any
Subsidiary of
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the Company, any employee benefit plan of the Company or any Subsidiary of the
Company, or any entity holding Common Shares, or Class B Common Shares, for or
pursuant to the terms of any such plan) and (ii) 10%.
Section 27. DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS,
ETC.
For all purposes of this Agreement, any calculation of the number of
Common Shares and/or Class B Common Shares outstanding at any particular time,
including for purposes of determining the particular percentage of the total
voting power of the Company of which any Person is the Beneficial Owner, shall
be made in accordance with the provisions of Rule 13d-3d(1)(i) of the General
Rules and Regulations under the Exchange Act as in effect on the date hereof.
The Board of Directors of the Company (and, where specifically provided for
herein, the Disinterested Directors) shall have the exclusive power and
authority to administer this Agreement and to exercise all rights and powers
specifically granted to the Board, or the Company (or, where specifically
provided for herein, the Disinterested Directors), 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 (including any determination required by the definitions contained in
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 purpose of
clause (ii) below, all omissions with respect to the foregoing) which are done
or made by the Board (or, where specifically provided for herein, by the
Disinterested Directors) in good faith, shall (i) be final, conclusive and
binding on the Company, the Rights Agent, the holders of the Right Certificates
and all other parties, and (ii) not subject the Board or the Disinterested
Directors to any liability to the holders of the Right Certificate.
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. The Company covenants
and agrees that it shall not
(i) consolidate with,
(ii) merge with or into, or
(iii) sell or transfer, in one or more transactions, assets
or earning power aggregating more than 50%
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of the assets or earning power of the Company and its
Subsidiaries taken as a whole, to
any Acquiring Person or its Affiliates or Associates if at the time of or after
such consolidation, merger or sale there are any charter or by-law provisions
or any rights, warrants or other instruments outstanding or any other action
taken which would diminish or otherwise eliminate the benefits intended to be
afforded by the Rights, without the affirmative vote of the holders of at least
80% of the then outstanding Rights beneficially owned by Persons other than the
Acquiring Person or its Affiliates or Associates. The Company shall not
consummate any such consolidation, merger or sale unless prior thereto the
Company and such other Person shall have executed and delivered to the Rights
Agent a supplemental agreement so providing.
Section 29. BENEFITS OF THIS AGREEMENT.
Nothing in this Agreement shall be construed to give to any Person
other than the Company, the Rights Agent and the registered holders of the
Right Certificates (and, prior to the Distribution Date, the Common Shares and
Class B Common Shares) 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.
Section 30. SEVERABILITY.
If any term, provision, covenant or restriction of this Agreement is
held by a court of competent jurisdiction or other authority to be invalid,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.
Section 31. GOVERNING LAW.
This Agreement and each Right Certificate issued hereunder shall be
deemed to be a contract made under the laws of the State of Ohio and for all
purposes shall be governed by and construed in accordance with the laws of such
State applicable to contracts to be made and performed entirely within such
State.
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<PAGE> 35
Section 32. COUNTERPARTS.
This Agreement may be executed in any number of counterparts and each
of such counterparts shall for all purposes be deemed to be an original, and
all such counterparts shall together constitute but one and the same
instrument.
Section 33. DESCRIPTIVE HEADINGS.
Descriptive headings of the several Sections of this Agreement are
inserted for convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
INVACARE CORPORATION
Attest:
By By /s/Thomas R. Miklich
---------------------------- ----------------------------
NATIONAL CITY BANK
Attest:
By By /s/Dave Davis
---------------------------- ----------------------------
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<PAGE> 1
EXHIBIT A
--------
Form of Right Certificate
Certificate No. R- _______________ Rights
NOT EXERCISABLE AFTER JULY 7, 2005 OR EARLIER IF REDEEMED.
THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE
COMPANY, AT $.01 PER RIGHT, SUBJECT TO ADJUSTMENT, ON THE
TERMS SET FORTH IN THE RIGHTS AGREEMENT. THE RIGHTS
REPRESENTED BY THIS CERTIFICATE WERE ISSUED TO A PERSON WHO
WAS AN ACQUIRING PERSON OR AN ASSOCIATE OR AFFILIATE OF AN
ACQUIRING PERSON. THIS RIGHT CERTIFICATE AND THE RIGHTS
REPRESENTED HEREBY MAY BECOME VOID IN THE CIRCUMSTANCES
SPECIFIED IN SECTION 11(a)(ii) OR SECTION 11(d) OF THE RIGHTS
AGREEMENT.*
Right Certificate
___________________
This certifies that ______________________, or registered assigns, is
the registered owner of the number of Rights set forth above, each of which
entitles the owner thereof, subject to the terms, provisions and conditions of
the Rights Agreement dated as of July 7, 1995 (the "Rights Agreement") between
Invacare Corporation, an Ohio corporation (the "Company") and National City
Bank, a national banking association (the "Rights Agent"), to purchase from the
Company at any time after the Distribution Date (as such term is defined in the
Rights Agreement) and prior to 5:00 P.M. (Cleveland, Ohio time) on July 7, 2005
at the principal office of the Rights Agent, or its successors as Rights Agent,
in Cleveland, Ohio, one-tenth of one fully paid nonassessable Common Share,
without par value (a "Common Share") of the Company, at a purchase price of $16
per one-tenth of one Common Share (the "Purchase Price"), upon presentation and
surrender of this Right Certificate with the Form of Election to Purchase duly
executed. The number of Rights evidenced by this Right Certificate (and the
number of shares which may be purchased upon exercise thereof) set forth above,
and the Purchase Price per share set forth above, are the number and Purchase
Price as of July 18, 1995, based on the Common Shares as constituted at such
date.
__________________________________
* The portion of the legend in brackets shall be inserted only if
applicable.
33
<PAGE> 2
As provided in the Rights Agreement, the Purchase Price and the number
of Common Shares which may be purchased upon the exercise of the Rights
evidenced by this Right Certificate are subject to modification and adjustment
upon the happening of certain events.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the Rights Agreement are on file at the above-mentioned office of the Rights
Agent.
This Right Certificate, with or without other Right Certificates, upon
surrender at the principal office of the Rights Agent, may be exchanged for
another Right Certificate or Right Certificates of like tenor and date
evidencing Rights entitling the holder to purchase a like aggregate number of
one-tenths of Common Shares as the Rights evidenced by the Right Certificate or
Right Certificates surrendered shall have entitled such holder to purchase. If
this Right Certificate shall be exercised in part, the holder shall be entitled
to receive upon surrender hereof another Right Certificate or Right
Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Certificate may be redeemed by the Company at its option at a
redemption price of $.01 per Right, subject to adjustment.
No fractional Common Shares will be issued upon the exercise of any
Right or Rights evidenced hereby, but in lieu thereof a cash payment will be
made, as provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Common Shares
or of any other securities of the Company which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any of the
rights of a 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 the
Rights Agreement), or to receive dividends or subscription rights, or
otherwise, until the Right or Rights evidenced by this Right Certificate shall
have been exercised as provided in the Rights Agreement.
34
<PAGE> 3
This Right Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
References in this Right Certificate to Common Share or Common Shares
shall refer only to Common Shares, without par value, of the Company and not to
Class B Common Shares of the Company.
WITNESS the facsimile signature of the proper officers of the Company.
Dated as of _________, 1995.
INVACARE CORPORATION
Attest:
______________________________ By:___________________________
Title:___________________
Countersigned:
NATIONAL CITY BANK,
RIGHTS AGENT
By_____________________________
Authorized Signature
35
<PAGE> 4
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
------------------
(To be executed by the registered holder if such
holder desires to transfer the Right Certificates.)
FOR VALUE RECEIVED, ____________________________________
hereby sells, assigns and transfers unto ________________________
_________________________________________________________________
(Please print name and address of transferee)
_________________________________________________________________
this Right Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and
appoint ___________ Attorney, to transfer the within Right
Certificate on the books of the within- named Company, with full
power of substitution.
Dated:_________________, 19__
_______________________________
Signature
Signature Guaranteed:
NOTICE
------
The signature to the foregoing Assignment must correspond to the name
as written upon the face of this Right Certificate in every particular, without
alteration or enlargement or any change whatsoever.
36
<PAGE> 5
FORM OF ELECTION TO PURCHASE
----------------------------
(To be executed if holder desires to
exercise the Right Certificate.)
To Invacare Corporation:
The undersigned hereby irrevocably elects to exercise ____________
Rights represented by this Right Certificate to purchase the Common Shares
issuable upon the exercise of such Rights and requests that certificates for
such shares be issued in the name of:
Please insert social security
or other identifying number
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
If such number of Rights shall not be all the Rights evidenced by
this Right Certificate, a new Right Certificate for the balance
remaining of such Rights shall be registered in the name of and
delivered to:
Please insert social security
or other identifying number
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
Dated:____________________, 19__
______________________________
Signature
(Signature must conform in all
respects to name of holder as
specified on the face of this
Right Certificate)
Signature Guaranteed:
373/12873NLB.EVE
37
