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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): June 17, 1998
MATERIAL SCIENCES CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-8803 95-2673173
(State or other jurisdiction of (Commission File Number) (IRS Employer
incorporation) Identification No.)
2300 East Pratt Boulevard
Elk Grove Village, Illinois 60007
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(Address of principal executive
offices)
Registrant's telephone number, including area code: (847) 439-8270
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Item 5. Other Events.
On June 17, 1998, the Board of Directors amended the Registrant's By-
Laws, principally to provide for advance notices of nominations of directors and
stockholder proposals. A copy of the Registrant's By-Laws, as amended, is filed
herewith as Exhibit 3.
Also on June 17, 1998, the Board of Directors of the Registrant
approved an amendment (the "Amendment") to the Rights Agreement (the "Rights
Agreement"), dated as of June 20, 1996, between the Registrant and ChaseMellon
Shareholder Services, L.L.C., as rights agent. The Amendment lowers the
threshold amount (from 20% to 15%) upon which a beneficial owner of shares of
the Registrant's Common Stock becomes an Acquiring Person (as defined in the
Rights Agreement) and triggers a Distribution Date (as defined in the Rights
Agreement). A copy of the Amendment is filed herewith as Exhibit 4.
Additionally, the Registrant approved change in control arrangements
for approximately 84 employees, including Change of Control Agreements for all
of its executive officers. In general, the Change in Control Agreements with the
executive officers provide that in the event that after a Change in Control (as
defined therein) employment is terminated by the Registrant without "Cause" (as
defined therein) or by such executive for "Good Reason" (as defined therein) or,
within 30 days after the first anniversary of a Change in Control, without Good
Reason, the Registrant will pay to such executive officer a lump sum payment of
one and a half to three times such executive officer's annual base salary plus
bonus plus required defined contribution plan contributions, and will provide
other compensation and benefits. Such Change in Control Agreements also provide
for gross-up payments for certain income tax payments and for, in some cases,
covenants not to compete.
The Registrant also approved an amendment to the Supplemental Employee
Retirement Plan established in 1992 (the "1992 SERP"). The amendment to the
1992 SERP changed the terms and provisions of the 1992 SERP to immediately vest
participants and commence benefits in a change of control situation and increase
the years of service credited from actual years of service to actual years of
service plus two years in a change of control situation.
Item 7. Financial Statements and Exhibits.
(a) Financial Statements of Business Acquired.
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Not applicable.
(b) Pro Forma Financial Information.
Not applicable.
(c) Exhibits.
See the exhibits listed in the Index to Exhibits.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
MATERIAL SCIENCES CORPORATION
Dated: June 19, 1998 By: /s/ James J. Waclawik, Sr.
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James J. Waclawik, Sr.
Vice President, Chief Financial Officer and
Secretary
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Index to Exhibits
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Exhibit No. Description of Document
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3 By-Laws of the Registrant, as amended
4 First Amendment to Rights Agreement, dated as of June 17, 1998
between the Registrant and ChaseMellon Shareholder Services,
L.L.C., as rights agent
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Exhibit 3
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By-Laws
OF
MATERIAL SCIENCES CORPORATION
(Revised June 17, 1998)
ARTICLE I
Offices
SECTION 1.1 Registered Office. The registered office of the
Corporation in the State of Delaware shall be located at 1209 Orange Street in
the City of Wilmington County of New Castle and the name of its registered agent
is The Corporation Trust Company. The registered office and/or registered agent
of the Corporation may be changed from time to time by action of the Board of
Directors.
SECTION 1.2 Other Offices. The Corporation may also have offices at
such other places both within or without the State of Delaware as the Board of
Directors may from time to time determine or the business of the Corporation may
require.
ARTICLE II
Meetings of Stockholders
SECTION 2.1 Annual Meeting. The annual meeting of the Stockholders
shall be held at 10:00 a.m. on the third Friday in June in each year (if not a
legal holiday, or, if a legal holiday, then on the next succeeding business day)
or at such other time or date as the Board of Directors shall determine, for the
purpose of electing Directors and for the transaction of such other business as
may come before the meeting. If the election of Directors shall not be held on
the day hereinbefore designated for the annual meeting, or at any adjournment
thereof, the Board of Directors shall cause such election to be held at a
special meeting of Stockholders as soon thereafter as convenient.
SECTION 2.2 Special Meetings. Except as otherwise prescribed by
statute or the Certificate of Incorporation, special meetings of the
Stockholders, for any purpose or purposes may be called by the Chairman of the
Board, in his discretion, and shall be called by the Chairman of the Board or
the Secretary at the request in writing of a majority of the directors then
holding office, or at the request in writing of Stockholders owning at least the
number of shares of the Corporation
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issued and outstanding and entitled to caste a majority of the votes at such
meeting. Any such written request shall state the purpose or purposes of the
proposed meeting and may designate the location thereof.
SECTION 2.3 Place of Meetings. Each meeting of the Stockholders for
the election of Directors shall be held at the principal office of the
Corporation in Elk Grove Village, Illinois, unless the Chairman of the Board, a
majority of the Directors then holding office, or Stockholders entitled to cast
not less than a majority of the votes at the meeting shall designate any other
place, within or without the State of Delaware, as the place of such meeting.
Meetings of Stockholders for any other purpose may be held at such place, within
or without the State of Delaware, and at such time as shall be determined
pursuant to Section 2.2 and stated in the notice of the meeting or in a duly
executed waiver of notice thereof.
SECTION 2.4 Notice of Meetings. Written or printed notice stating the
place and time of each annual or special meeting of the Stockholders and, in the
case of a special meeting, the purpose or purposes for which the meeting is
called, shall be given no less than ten days nor more than sixty (60) days
before the date of the meeting.
When a meeting is adjourned to another time or place, no notice of the
adjourned meeting other than an announcement at the meeting need be given unless
the adjournment is for more than thirty (30) days or a new record date is fixed
for the adjourned meeting after such adjournment.
SECTION 2.5 Meeting of all Stockholders. If all of the Stockholders of
the Corporation entitled to vote shall meet at any time and place, either within
or without the state of Delaware, and consent to the holding of a meeting, such
meeting shall be valid without call or notice and any corporate action may be
taken at such meeting.
SECTION 2.6 Stockholder List. At least ten days before every meeting
of Stockholders, a complete list of the Stockholders entitled to vote at such
meeting, arranged in alphabetical order, and showing the address of each such
Stockholder and the number of shares registered in the name of each such
Stockholder, shall be prepared by the officer who has charge of the stock ledger
of the Corporation. Such list shall be open to examination of any Stockholder of
the Corporation during ordinary business hours, for any purpose germane to the
meeting, for a period of at least ten (10) days prior to the meeting, at the
office of the Corporation in Chicago, Illinois, and the list shall be produced
and kept at the time and place of meeting during the whole time thereof, and
subject to the inspection by any Stockholder who may be present.
SECTION 2.7 Quorum. The holders of capital stock of the Corporation
having a majority of the voting power thereof, present in person or represented
by proxy, shall be requisite for, and shall constitute, a quorum at all meetings
of the Stockholders of the Corporation for the transaction of business, except
as otherwise provided by Delaware law, the Certificate of Incorporation or these
By-Laws. If, however, such quorum shall not be present or represented at
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any meeting of the Stockholders, the Stockholders entitled to vote thereat
present in person or represented by proxy shall have power to adjourn the
meeting from time to time until a quorum shall be present or represented. At
such adjourned meeting at which a quorum shall be present or represent ed, any
business may be transacted which might have been transacted at the meeting as
originally notified.
SECTION 2.8 Proxies. At every meeting of the Stockholders, each
Stockholder having the right to vote thereat shall be entitled to vote in person
or by proxy. Such proxy shall be appointed by an instrument in writing
subscribed by such Stockholder and bearing a date not more than three years
prior to such meeting, unless such proxy provides for a longer period, and it
shall be filed with the Secretary of the Corporation before, or at the time of
the meeting.
SECTION 2.9 Voting. Unless the Certificate of Incorporation provides
otherwise, at every meeting of Stockholders, each Stockholder shall be entitled
to one vote for each share of stock of the Corporation entitled to vote thereat
and registered in the name of such Stockholder on the books of the Corporation
on the pertinent record date. When a quorum is present at any meeting of the
Stockholders the vote of the holders of capital stock of the Corporation having
a majority of the voting power thereof, represented at such meeting in person or
by proxy, shall decide any question brought before such meeting, unless the
question is one upon which, by provision of Delaware law, the Certificate of
Incorporation or these By-Laws, a different vote is required, in which case such
provision shall govern and control the decision of such question. If the
Certificate of Incorporation provides for more or less than one vote for any
share on any matter, every reference in these By-Laws to a majority or other
proportion of stock shall refer to such majority or other proportion of the
votes of such stock.
SECTION 2.10 Voting of Certain Shares. Shares standing in the name of
another corporation, domestic or foreign, and entitled to vote may be voted by
such officer, agent, or proxy as the by-laws of such corporation may prescribe
or, in the absence of such provision, as the board of directors of such
corporation may determine. Shares standing in the name of a deceased person, a
minor or an incompetent and entitled to vote may be voted by such person's
administrator, executor, guardian or conservator, as the case may be, either in
person or by proxy. Shares standing in the name of a trustee, receiver or
pledgee and entitled to vote may be voted by such trustee, receiver or pledgee
either in person or by proxy as provided by Delaware law.
SECTION 2.11 Cumulative Voting. Subject to the provisions of the next
sentence, at all elections of directors of the Corporation, each Stockholder
shall be entitled to cumulate his votes and to give one candidate a number of
votes equal to the number of directors to be elected multiplied by the number of
votes to which his shares are entitled, or to distribute his votes on the same
principle among as many candidates as he shall think fit. No Stockholder shall
be entitled to cumulate his votes unless the name of the candidate or candidates
for whom such votes would be cast has been placed in nomination prior to the
voting and any Stockholder has given notice at the meeting prior to the voting
of such Stockholder's intention to cumulate his votes. The
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candidates receiving the highest number of votes up to the number of directors
to be elected shall be elected.
SECTION 2.12 Action Without Meeting Prohibited. As provided in the
Certificate of Incorporation, no action required to, or which may, be taken at
an annual or special meeting of Stockholders of the Corporation may be taken
without a meeting, and the power of the Stockholders of the Corporation to act
by written consent, whether pursuant to Section 228 of the General Corporation
Law of the State of Delaware or otherwise, is specifically denied.
SECTION 2.13 Treasury Stock. Shares of its own stock belonging to the
Corporation or to another corporation if a majority of the shares entitled to
vote in the election of directors of such other corporation is held by this
Corporation, shall not be voted at any meeting and shall not be counted in
determining the total number of outstanding shares for the purpose of
determining whether a quorum is present. Nothing in this section shall be
construed to limit the right of this Corporation to vote shares of its own stock
held by it in a fiduciary capacity.
SECTION 2.14 Advance Notice of Nominations. Subject to such rights of
the holders of any class or series of preferred stock as shall be prescribed in
the Certificate of Incorporation or in the resolutions of the Board of Directors
providing for the issuance of any such class or series, only persons who are
nominated in accordance with the procedures set forth in this Section 2.14 shall
be eligible for election as, and to serve as, directors. Nominations of persons
for election to the Board of Directors may be made at a meeting of the
Stockholders at which directors are to be elected (a) by or at the direction of
the Board of Directors or (b) by any Stockholder of the Corporation entitled to
vote at such meeting in the election of directors who complies with the
requirements of this Section 2.14. Such nominations, other than those made by or
at the direction of the Board of Directors, shall be preceded by timely advance
notice in writing to the Secretary of the Corporation. To be timely, a
Stockholder's notice shall be delivered to the Secretary at the principal
executive offices of the Corporation not later than the close of business on the
sixtieth (60th) day nor earlier than the close of business on the ninetieth
(90th) day prior to the first anniversary of the preceding year's annual
meeting; provided, however, that in the event that the date of the annual
meeting is more than thirty (30) days before or more than sixty (60) days after
such anniversary date, notice by the Stockholder to be timely must be so
delivered not earlier than the close of business on the ninetieth (90th) day
prior to such annual meeting and not later than the close of business on the
later of the sixtieth (60th) day prior to such annual meeting or the tenth
(10th) day following the day on which public announcement of the date of such
meeting is first made by the Corporation. In no event shall the public
announcement of an adjournment of an annual meeting commence a new time period
for the giving of a Stockholder's notice as described above. A Stockholder's
notice to the Secretary shall set forth (x) as to each person whom the
Stockholder proposes to nominate for election or re-election as a director, (i)
the name, age, business address and residence address of such person, (ii) the
principal occupation or employment of such person, (iii) the number of shares of
each class of capital stock of the Corporation beneficially owned by such
person, and (iv) the written consent of such person to having such person's name
placed in nomination at the meeting and to serve as a director if elected and
(y) as to the Stockholder giving
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the notice, (i) the name and address, as they appear on the Corporation's books,
of such Stockholder and (ii) the number of shares of each class of voting stock
of the Corporation which are then beneficially owned by the Stockholder. The
presiding officer of the meeting of Stockholders shall determine whether the
requirements of this Section 2.14 have been met with respect to any nomination
or intended nomination. If the presiding officer determines that any nomination
was not made in accordance with the requirements of this Section 2.14, he or she
shall so declare at the meeting and the defective nomination shall be
disregarded.
SECTION 2.15 Advance Notice of Stockholder Proposals. At any annual
meeting of Stockholders and effective as of any Stockholder meeting subsequent
to the 1998 annual Stockholder meeting, only such business shall be conducted,
and only such proposals shall be acted upon, as shall have been brought before
the annual meeting (a) by or at the direction of the Board of Directors or (b)
by any Stockholder of the Corporation who complies with the requirements of this
Section 2.15 and as shall otherwise be proper subjects for Stockholder action
and shall be properly introduced at the meeting. For a proposal to be properly
brought before an annual meeting by a Stockholder, the Stockholder must have
given timely advance notice thereof in writing to the Secretary of the
Corporation. To be timely, a Stockholder's notice shall be delivered to the
Secretary at the principal executive offices of the Corporation not later than
the close of business on the sixtieth (60th) day nor earlier than the close of
business on the ninetieth (90th) day prior to the first anniversary of the
preceding year's annual meeting; provided, however, that in the event that the
date of the annual meeting is more than thirty (30) days before or more than
sixty (60) days after such anniversary date, notice by the Stockholder to be
timely must be so delivered not earlier than the close of business on the
ninetieth (90th) day prior to such annual meeting and not later than the close
of business on the later of the sixtieth (60th) day prior to such annual meeting
or the tenth (10th) day following the day on which public announcement of the
date of such meeting is first made by the Corporation. In no event shall the
public announcement of an adjournment of an annual meeting commence a new time
period for the giving of a Stockholder's notice as described above. A
Stockholder's notice to the Secretary shall set forth as to each matter the
Stockholder proposes to bring before the annual meeting (w) a description of the
proposal desired to be brought before the annual meeting and the reasons for
conducting such business at the annual meeting, (x) the name and address, as
they appear on the Corporation's books, of the Stockholder proposing such
business and any other Stockholders known by such Stockholder to be supporting
such proposal, (y) the class and number of shares of the Corporation's stock
which are beneficially owned by the Stockholder on the date of such notice and
(z) any financial interest of the Stockholder in such proposal. The presiding
officer of the annual meeting shall determine whether the requirements of this
Section 2.15 have been met with respect to any Stockholder proposal. If the
presiding officer determines that a Stockholder proposal was not made in
accordance with the terms of this Section 2.15, he or she shall so declare at
the meeting and any such proposal shall not be acted upon at the meeting.
At a special meeting of Stockholders, only such business shall be
acted upon as shall have been set forth in the notice relating to the meeting or
as shall constitute matters incident to the conduct of the meeting as the
presiding officer of the meeting shall determine to be appropriate.
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ARTICLE III
Directors
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SECTION 3.1 Number and election. The number of Directors which shall
constitute the whole Board of Directors shall be as fixed from time to time by a
resolution adopted by a majority of the Directors then in office; provided,
however, that no decrease in the number of directors constituting the whole
Board of Directors shall shorten the term of any incumbent Director. Directors
shall be elected annually by the Stockholders as provided in Section 2.1 or in
accordance with Section 3.2 of these By-Laws and each Director elected shall
hold office until his successor is elected and qualified or until his death or
resignation or until he shall have been removed in the manner hereinafter
provided. Directors need not be residents of the State of Delaware or
Stockholders of this Corporation.
SECTION 3.2 Resignations and Vacancies. Any Director may resign at any
time by giving written notice to the Chairman of the Board, the President, the
Secretary or the Board of Directors. Any such resignation shall take effect at
the date of the receipt of such notice or at any later time specified therein;
and, unless otherwise specified therein the acceptance of such resignation shall
not be necessary to make it effective. If, at any other time than the annual
meeting of the Stockholders any vacancy occurs in the Board of Directors caused
by resignation, death, retirement, disqualification or removal from office of
any Director or otherwise, or any new Directorship is created by an increase in
the authorized number of Directors by resolution pursuant to Section 3.1 of
these By-Laws, a majority of the Directors then in office, although less than a
quorum, may choose a successor, or fill the newly created Directorship, and the
Director so chosen shall hold office until the next annual election of Directors
by the Stockholders and until his successor shall be duly elected and qualified,
unless sooner displaced.
SECTION 3.3 Removal. Any Director may be removed, with or without
cause, at any meeting of the Stockholders, by the affirmative vote of the
holders of capital stock of the Corporation having a majority of the voting
power thereof, and the vacancy in the Board of Directors caused by such removal
may be filled by the Stockholders at such meeting; provided, however, that no
director may be removed without cause if the votes cast against his removal
would be sufficient to elect him if then cumulatively voted at an election of
the entire Board of Directors.
SECTION 3.4 Management of Affairs of Corporation. The property and
business of the Corporation shall be managed by its Board of Directors, which
may exercise all such powers of the Corporation and do all such lawful acts and
things as are not by Delaware law or by the Certificate of Incorporation or by
these By-Laws directed or required to be exercised or done by Stockholders. In
case the Corporation shall transact any business or enter into any contract with
a Director, or with any firm of which one or more of its Directors are members,
or with any trust, firm, corporation or association in which any Director is a
Stockholder, director or officer or otherwise interested, the officers of the
Corporation and the Directors in question shall be severally under the duty of
disclosing all material facts as to their interest to the remaining Directors
prior to any
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authorization of the transaction by the Board of Directors. In the case of
continuing relationships in the normal course of business such disclosure shall
be deemed effective, when once given, as to all transactions and contracts
subsequently entered into.
SECTION 3.5 Dividends and Reserves. Dividends upon stock of the
Corporation may be declared by the Board of Directors at any regular or special
meeting, pursuant to law. Dividends may be paid in cash in property, in shares
of stock or otherwise in the form, and to the extent, permitted by law. The
Board of Directors may set apart, out of any funds of the Corporation available
for dividends, a reserve or reserves for working capital or for any other lawful
purpose, and also may abolish any such reserve in the manner in which it was
created.
SECTION 3.6 Regular Meetings. An annual meeting of the Board of
Directors shall be held, without other notice than this By-Law, immediately
after, and at the same place as, the annual meeting of the Stockholders. The
Board of Directors may provide, by resolution, the time and place, either within
or without the State of Delaware, for the holding of additional regular meetings
without other notice than such resolution.
SECTION 3.7 Special Meetings. Special meetings of the Board of
Directors may be called by or at the request the Chairman of the Board, the
President, any vice president, the Secretary, any assistant secretary or any two
Directors, to be held at such time and place, either within or without the State
of Delaware, as shall be designated by the call and specified in the notice of
such meeting and notice thereof shall be given as provided in Section 3.8 of
these By-Laws.
SECTION 3.8 Notice of Special Meetings. Except as otherwise prescribed
by Delaware law, written or actual oral notice of the time and place of each
special meeting of the Board of Directors shall be given at least two days prior
to the time of holding the meeting. Any Director may waive notice of any
meeting.
SECTION 3.9 Quorum. At each meeting of the Board of Directors, the
presence of not less than a majority of the total number of Directors shall be
necessary and sufficient to constitute a quorum for the transaction of business,
and the act of a majority of the Directors present at any meeting at which there
is a quorum shall be the act of the Board of Directors, except as may be
otherwise specifically provided by Delaware law or these By-Laws. If a quorum
shall not be present at any meeting of Directors, the Directors present thereat
may adjourn the meeting from time to time, without notice other than
announcement at the meeting, until a quorum shall be present.
SECTION 3.10 Meetings by Conference Telephone. Unless otherwise
restricted by the Certificate of Incorporation, any member of the Board of
Directors or of any committee designated by the Board of Directors may
participate in a meeting of the Directors or committee by means of conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other, and participation in a meeting
by means of such equipment shall constitute presence in person at such meeting.
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SECTION 3.11 Presumption of Assent. Unless otherwise provided by
Delaware law, a Director of the Corporation who is present at a meeting of the
Board of Directors at which action is taken on any corporate matter shall be
presumed to have assented to the action taken unless his dissent shall be
entered in the minutes of the meeting or unless he shall file his written
dissent to such action with the person acting as Secretary of the meeting before
the adjournment thereof or shall forward such dissent by registered mail to the
Secretary of the Corporation immediately after the adjournment of the meeting.
Such right to dissent shall not apply to a Director who voted in favor of such
action.
SECTION 3.12 Action Without Meeting. Unless otherwise restricted by
the Certificate of Incorporation or these By-Laws, any action required or
permitted to be taken at any meeting of the Board of Directors, or of any
committee thereof, may be taken without a meeting, if a written consent thereto
is signed by all members of the Board of Directors or of such committee, as the
case may be, and such written consent is filed with the minutes of proceedings
of the Board of Directors or committee.
SECTION 3.13 Executive Committee. The Board of Directors may, by
resolution passed by a majority of the number of Directors fixed by these By-
Laws, designate one or more Directors of the Corporation to constitute an
Executive Committee, which, except to the extent otherwise provided in the
resolution designating the Executive Committee and by Delaware law, shall have
and may exercise all the powers and authority of the Board of Directors in the
management of the business and affairs of the Corporation and may authorize the
seal of the Corporation to be affixed to all papers which may require it.
SECTION 3.14 Other Committees. The Board of Directors may, by
resolution passed by a majority of the number of Directors fixed by these By-
Laws, designate such other committees as it may from time to time determine.
Each such committee shall consist of such number of Directors, shall serve for
such term and shall have and may exercise, during intervals between meetings of
the Board of Directors, such duties, functions and powers as the Board of
Directors may from time to time prescribe.
SECTION 3.15 Alternates. The Board of Directors may from time to time
designate from among the Directors alternates to serve on one or more committees
as occasion may require. Whenever a quorum cannot be secured for any meeting of
any committee from among the regular members thereof and designated alternates,
the member or members of such committee present at such meeting and not
disqualified from voting, whether or not he or they constitute a quorum, may
unanimously appoint another member of the Board of Directors to act at the
meeting in place of such absent or disqualified member.
SECTION 3.16 Quorum and Manner of Acting - Committees. The presence of
a majority of the designated members of any committee shall constitute a quorum
for the transaction of business at any meeting of much committee, and the act of
a majority of those present shall be necessary for the taking of any action
thereat.
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SECTION 3.17 Committee Chairmen, Books and Records. The chairman of
each committee shall be selected from among the members of the committee by the
Board of Directors.
Each committee shall keep a record of its acts and proceedings and all
actions of each committee shall be reported to the Board of Directors at its
next meeting.
Each committee shall fix its own rules of procedure not inconsistent
with these By-Laws or the resolution of the Board or Directors designating such
committee and shall meet at such times and places and upon such call or notice
as shall be provided by such rules.
SECTION 3.18 Fees and Compensation of Directors. Directors shall not
receive any stated salary for their services as such; but, by resolution of the
Board of Directors, a fixed fee, with or without expenses of attendance, may be
allowed for attendance at each regular or special meeting of the Board of
Directors. Members of the Board of Directors may be allowed their reasonable
traveling expenses when actually engaged in the business of the Corporation.
Members of any committee may be allowed like fees and expenses for attending
committee meetings. Nothing herein contained shall be construed to preclude any
Director from serving the Corporation in any other capacity and receiving
compensation therefor.
SECTION 3.19 Reliance Upon Records. Every Director of the Corporation,
and every member of any committee designated by the Board of Directors pursuant
to authority conferred by Section 3.15 of these By-Laws, shall, in the
performance of his duties, be fully protected in relying in good faith upon the
books of account or reports made to the Corporation by any of its officials, or
by an independent certified public accountant, or by an appraiser selected with
reasonable care by the Board of Directors or by such committee, or in relying in
good faith upon other records of the Corporation, including, without limiting
the generality of the foregoing, records setting forth or relating to the value
and amount of assets, liabilities and profits of the Corporation or any other
facts pertinent to the existence and amount of surplus or other funds from which
dividends might properly be declared or paid or with which stock of the
Corporation might lawfully be purchased or redeemed.
ARTICLE IV
Notices
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SECTION 4.1 Manner of Notice. Whenever under the provisions of
Delaware law, the Certificate of Incorporation or these By-Laws notice is
required to be given to any Stockholder, Director or member of any committee
designated by the Board of Directors, it shall not be construed to require
personal delivery and such notice may be given in writing by depositing it, in a
sealed envelope, in the United States mail, first class, postage prepaid,
addressed (or by delivering it to a
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telegraph company, charges prepaid, for transmission) to such Stockholder,
Director or member either at the address of such Stockholder, Director or member
as it appears on the books of the Corporation or, in the case of such a Director
or member, at his business address; and such notice shall be deemed to be given
at the time when it is thus deposited in the United States mail (or delivered to
the telegraph company). Such requirement for notice shall be deemed satisfied,
except in the case of Stockholder meetings with respect to which written notice
is mandatorily required by law, if actual notice is received orally or in
writing by the person entitled thereto as far in advance of the event with
respect to which notice is given as the minimum notice period required by law or
these By-Laws.
SECTION 4.2 Waiver of Notice. Whenever any notice is required to be
given under the provisions of Delaware law, the Certificate of Incorporation or
these By-Laws, a waiver thereof in writing signed by the person or persons
entitled to such notice, whether before, at or after the time stated therein,
shall be deemed equivalent thereto. Attendance by a person at a meeting shall
constitute a waiver of notice of such meeting, except when the person attends a
meeting for the express purpose of objecting, at the beginning of the meeting,
to the transaction of any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at, nor the purpose of, any
regular or special meeting of the Stockholders, Directors or Committee of
Directors need be specified in any written waiver of notice unless so required
by Delaware law, the Certificate of Incorporation or these By-Laws.
ARTICLE V
Officers
--------
SECTION 5.1 Offices and Official Positions. The officers of the
Corporation shall be a Chairman of the Board or a President, or both, one or
more Vice Presidents (the rank and number thereof to be determined by the Board
of Directors), a Secretary, a Chief Financial Officer and such assistant
secretaries, assistant treasurers, and other officers as the Board of Directors
shall determine. Any two or more offices may be held by the same person. None of
the officers need be a Director or a Stockholder of the Corporation or a
resident of the State of Delaware. The Board of Directors may from time to time
establish and abolish official positions within any divisions into which the
business and operations of the Corporation may be divided pursuant to Section
6.1 of these By-Laws, and assign titles and duties to such positions. Those
appointed to official positions within divisions may, but need not, be officers
of the Corporation. The Board of Directors shall appoint officers to official
positions within a division and may with or without cause remove from such a
position any person appointed to it. In any event, the authority incident to an
official position within a division shall be limited to acts and transactions
within the scope of the business and operations of such division.
SECTION 5.2 Election and Terms of Office. The officers of the
Corporation shall be elected annually by the Board of Directors at their first
meeting held after each regular annual
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meeting of the Stockholders. If the election of officers shall not be held at
such meeting of the Board of Directors, such election shall be held at a regular
or special meeting of the Board of Directors as soon thereafter as may be
convenient. Each officer shall hold office until his successor is elected and
qualified or until his death or resignation or until he shall have been removed
in the manner hereinafter provided.
SECTION 5.3 Removal and Resignation. Any officer may be removed,
either with or without cause, by a majority of the Directors then in office at
any regular or special meeting of the Board of Directors; but such removal shall
be without prejudice to the contract rights, if any, of such person so removed.
Any officer may resign at any time by giving written notice to the Board of
Directors, to the President or to the Secretary of the Corporation. Any such
resignation shall take effect at the date of the receipt of such notice or at
any later time specified therein; and unless otherwise specified therein, the
acceptance of such resignation shall not be necessary to make it effective.
SECTION 5.4 Vacancies. A vacancy in any office because of death,
resignation, removal, or any other cause may be filled for the unexpired portion
of the term by the Board of Directors.
SECTION 5.5 Chairman of the Board. The Board of Directors may, in its
discretion, elect a Chairman of the Board, who, unless otherwise determined by
the Board of Directors, shall preside at all meetings of the Board of Directors
at which he is present and shall exercise and perform any other powers and
duties assigned to him by the Board of Directors or prescribed by the By-Laws.
If the office of President is vacant, the Chairman of the Board shall be the
general manager and chief executive officer of the Corporation and shall
exercise the duties of the President as set forth in Section 5.6.
SECTION 5.6 President. Subject to any supervisory powers, if any, that
may be given by the Board of Directors or the By-Laws to the Chairman of the
Board, if there be such an officer, the President shall be the Corporation's
general manager and chief executive officer and shall, subject to the control of
the Board of Directors, have general supervision, direction and control of the
business, affairs and officers of the Corporation. Unless otherwise determined
by the Board of Directors, he shall preside as chairman at all meetings of the
Stockholders, and in the absence of the Chairman of the Board, or if there be
none, at all meetings of the Board of Directors. He shall have the general
powers and duties of management usually vested in the office of President of a
Corporation; shall have any other powers and duties that are prescribed by the
Board of Directors or the By-Laws; and shall be primarily responsible for
carrying out all orders and resolutions of the Board of Directors.
SECTION 5.7 Vice Presidents. In the absence or disability of the chief
executive officer, the vice-presidents in order of their rank as fixed by the
Board of Directors, or, if not ranked, the vice president designated by the
Board of Directors, or if there has been no such designation, the vice president
designated by the chief executive officer shall perform all the duties of the
chief
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executive officer and when so acting, shall have all the powers of, and be
subject to all the restrictions on, the chief executive officer. Each vice
president shall have any of the powers and perform any other duties that from
time to time may be prescribed for him by the Board of Directors. or the By-laws
or the chief executive officer.
SECTION 5.8 Secretary. The Secretary shall keep or cause to be kept a
book of minutes of all meetings and actions by written consent of all directors,
Stockholders and committees of the Board of Directors. The minutes of each
meeting shall state the time and place that it was held and such other
information as shall be necessary to determine whether the meeting was held in
accordance with law and these By-Laws and the actions taken thereat. The
Secretary shall keep or cause to be kept at the Corporation's principal
executive office, or at the office of its transfer agent or registrar, a record
of the Stockholders of the Corporation giving the names and addresses of all
Stockholders and the number and class of shares held by each. The Secretary
shall give, or cause to be given, notice of all meetings of Stockholders,
Directors and committees required to be given under these By-Laws or by law,
shall keep or cause the keeping of the corporate seal in safe custody and shall
have any other powers and perform any other duties that are prescribed by the
Board of Directors or the By-laws or the chief executive officer. If the
Secretary refused or fails to give notice of any meeting lawfully called, any
other officer of the Corporation may give notice of such meeting.
SECTION 5.9 Chief Financial Officer. The Chief Financial Officer shall
keep and maintain, or cause to be kept and maintained, adequate and correct
books and records of account. The Chief Financial Officer shall cause all money
and other valuables in the name and to the credit of the Corporation to be
deposited at the depositories designated by the Board of Directors or any person
authorized by the Board of Directors to designate such depositories. He shall
render to the chief executive officer and Board of Directors, when either of
them request it, an account of all his transactions as Chief Financial Officer
and of the financial condition of the Corporation and shall have any other
powers and perform any other duties that are prescribed by the Board of
Directors or the By-Laws or the chief executive officer.
SECTION 5.10 Assistant Treasurers and Assistant Secretaries. The
assistant treasurers and assistant secretaries shall perform all functions and
duties which the Secretary or Chief Financial Officer, as the case may be, may
assign or delegate; but such assignment or delegation shall not relieve the
principal officer from the responsibilities and liabilities of his office. In
addition, an assistant secretary or an assistant treasurer, as thereto
authorized by the Board of Directors, may sign with the Chairman of the Board,
the President, or a vice president, certificates for shares of the Corporation,
the issuance of which shall have been duly authorized by resolution of the Board
of Directors; and the assistant secretaries and assistant treasurers shall, in
general, perform such duties as shall be assigned to them by the Secretary or
the Chief Financial Officer, respectively, or by the Chairman of the Board, the
President or by the Board of Directors. The assistant treasurers shall, if
required by the Board of Directors, give bonds for the faithful discharge of
their duties in such sums, and with such surety or sureties, as the Board of
Directors shall determine.
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SECTION 5.11 Salaries. The salaries of the officers shall be fixed
from time to time by the Board of Directors or by such officer as it shall
designate for such purpose or as it shall otherwise direct. No officer shall be
prevented from receiving a salary or other compensation by reason of the fact
that he is also a Director of the Corporation.
ARTICLE VI
Divisions
---------
SECTION 6.1 Divisions of the Corporation. The Board of Directors shall
have the power to create and establish such operating divisions of the
Corporation as it may from time to time deem advisable.
SECTION 6.2 Official Positions within a Division. The President may
appoint individuals, whether or not they are officers of the Corporation, to,
and may, with or without cause, remove them from, official positions established
within a division, but not filled by the Board of Directors.
ARTICLE VII
Contracts, Loans, Checks and Deposits
-------------------------------------
SECTION 7.1 Contracts and Other Instruments. The Board of Directors
may authorize any officer or officers, agent or agents, to enter into any
contract or execute and deliver any instrument in the name of and on behalf of
the Corporation, or of any division thereof, and such authority may be general
or confined to specific instances.
SECTION 7.2 Loans. No loans shall be contracted on behalf of the
Corporation, or any division thereof, and no evidence of indebtedness shall be
issued in the name of the Corporation, or any division thereof, unless
authorized by a resolution of the Board of Directors. Such authority may be
general or confined to specific instances.
SECTION 7.3 Checks, Drafts, etc. All checks, demands, drafts or other
orders for the payment of money, notes or other evidences of indebtedness issued
in the name of the Corporation, or any division thereof, shall be signed by such
officer or officers agent or agents of the Corporation, and in such manner, as
shall from time to time be authorized by the Board of Directors.
SECTION 7.4 Deposits. All funds of the Corporation, or any division
thereof, not otherwise employed shall be deposited from time to time to the
credit of the Corporation in such banks, trust companies or other depositories
as the Board of Directors may select.
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ARTICLE VIII
Certificates of Stock and their Transfer
----------------------------------------
SECTION 8.1 Certificates of Stock. The certificates of stock of the
Corporation shall be in such form as may be determined by the Board of
Directors, shall be numbered and shall be entered in the books of the
Corporation as they are issued. They shall exhibit the holder's name and number
of shares and shall be signed by the Chairman of the Board, the President or a
vice president and by the Chief Financial Officer or an assistant treasurer or
the Secretary or an assistant secretary. If any stock certificate is signed (a)
by a transfer agent or an assistant transfer agent or (b) by a transfer clerk
acting on behalf of the Corporation and a registrar, the signature of any
officer of the Corporation may be facsimile. In case any such officer whose
facsimile signature has thus been used on any such certificate shall cease to be
such officer, whether because of death, resignation or otherwise, before such
certificate has been delivered by the Corporation, such certificate may
nevertheless be delivered by the Corporation, as though the person whose
facsimile signature has been used thereon had not ceased to be such officer. All
certificates properly surrendered to the Corporation for transfer shall be
canceled and no new certificate shall be issued to evidence transferred shares
until the former certificate for at least a like number of shares shall have
been surrendered and canceled and the Corporation reimbursed for any applicable
taxes on the transfer, except that in the case of a lost, destroyed or mutilated
certificate a new one may be issued therefor upon such terms, and with such
indemnity, if any, to the Corporation, as the Board of Directors may prescribe
specifically or in general terms or by delegation to a transfer agent for the
Corporation.
SECTION 8.2 Lost, Stolen or Destroyed Certificates. The Board of
Directors, in individual cases, or by general resolution or by delegation to the
transfer agent, may direct a new certificate or certificates to be issued in
place of any certificate or certificates theretofore issued by the Corporation
alleged to have been lost, stolen or destroyed, upon the making of an affidavit
of that fact by the person claiming the certificate of stock to be lost, stolen
or destroyed. When authorizing such issue of a new certificate or certificates,
the Board of Directors may, in its discretion and as a condition precedent to
the issuance thereof, require the owner of such lost, stolen or destroyed
certificates, or his legal representative to advertise the same in such manner
as it shall require and or to give the corporation a bond in such sum as it may
direct as indemnity against any claim that may be made against the Corporation
with respect to the certificate alleged to have been lost, stolen or destroyed.
SECTION 8.3 Transfers of Stock. Upon surrender to the Corporation or
the transfer agent of the Corporation of a certificate for shares duly endorsed
or accompanied by proper evidence of succession, assignment or authority to
transfer, and upon payment-of applicable taxes with respect to such transfer,
and in compliance with any restrictions on transfer applicable to the
certificate or shares represented thereby of which the Corporation shall have
notice (including the provisions of Article IX of these By-Laws, if applicable)
and subject to such rules and regulations as the Board of Directors may from
time to time deem advisable concerning the transfer and registration of
certificates for shares of capital stock of the Corporation, the Corporation
shall issue a new certificate
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to the person entitled thereto, cancel the old certificate and record the
transaction upon its books. Transfers of shares shall be made only on the books
of the Corporation by the registered holder thereof or by his attorney or
successor duly authorized as evidenced by documents filed with the Secretary or
transfer agent of the Corporation.
SECTION 8.4 Restrictions on Transfer. Any Stockholder may enter into
an agreement with other Stockholders or with the Corporation providing for
reasonable limitation or restriction on the right of such Stockholder to
transfer shares of capital stock of the corporation held by him. Any such
limitation or restriction on the transfer of shares of this Corporation may be
set forth on certificates representing shares of capital stock or notice thereof
may be otherwise given to the Corporation or the transfer agent, in which case
the Corporation or the transfer agent shall not be required to transfer such
shares upon the books of the Corporation without receipt of satisfactory
evidence of compliance with the terms of such limitation or restriction.
SECTION 8.5 Fixing Record Date. The Board of Directors may fix in
advance a date not exceeding sixty (60) days, nor less than ten (10) days,
preceding the date of any meeting of Stockholders, or the date for the payment
of any dividend, or the date for the allotment of rights, or the date when any
change or conversion or exchange of capital stock shall go into effect, or a
date in connection with obtaining any consent, as a record date for the
determination of the Stockholders entitled to notice of, and to vote at, any
such meeting, or adjournment thereof or entitled to receive payment of any such
dividend, or to any such allotment of rights, or to exercise the rights in
respect of any such change, conversion or exchange of capital stock, or to give
such consent, and in such case such Stockholders and only such Stockholders as
shall be Stockholders of record on the date so fixed shall be entitled to notice
of, and to vote at, such meeting and any adjournment thereof, or to receive
payment of such dividend, or to receive such allotment of rights, or to exercise
such rights, or to give such consent, as the case may be, notwithstanding any
transfer of any stock on the books of the Corporation after any such record date
fixed as aforesaid.
SECTION 8.6 Stockholders of Record. The Corporation shall be entitled
to treat the holder of record of any share or shares of capital stock as the
holder in fact thereof and accordingly, shall not be bound to recognize any
equitable or other claim to or interest in such share or shares on the part of
any other person, whether or not it shall have express or other notice thereof,
except as otherwise provided by the laws of Delaware.
ARTICLE IX
Restrictions on Transfer of Common Stock Series
Issued Pursuant to Corporation's Stock Purchase Plan
----------------------------------------------------
SECTION 9.1 Applicability. The provisions of this Article IX shall
apply to shares of each series of Common Stock (including, without limitation,
shares of the Corporation's Series B Common Stock) issued by the Corporation to
persons pursuant to its Stock Purchase Plan as
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heretofore and hereafter amended (hereinafter in this Article IX, such shares
are referred to as the "Series Common Stock"); provided, however, that the
provisions and restrictions of this Article IX shall not apply to any shares of
Common Stock into which the shares of Series Common Stock may have been
converted pursuant to the terms of such Series Common Stock.
SECTION 9.2 Consent to Transfer. No holder of Series Common Stock
shall transfer, assign, pledge, encumber or otherwise dispose of any shares of
Series Common Stock without the prior written approval of the Corporation. Such
approval, however, shall not be required with respect to any of the following
transactions:
(i) gratuitous transfer of any or all of the Series Common Stock to
the members of the holder's immediate family (i.e., spouse or children) or to a
trust established for the benefit of one or more such family members;
(ii) transfer of any or all of the Series Common Stock to the heirs or
legatees of the holder by will or the laws of intestate succession;
(iii) pledge of Series Common Stock with the Corporation as security
for the payment of the purchase price; or
(iv) conversion of Series Common Stock into shares of Common Stock of
the Corporation in accordance with the provisions of the Certificate of
Determination of Preferences relating to such Series Common Stock.
Any individual to whom Series Common Stock is transferred by means of
a transaction specified in i) or (ii) above and any individual to whom Series
Common Stock is transferred with the prior written approval of the Corporation
shall be bound by all the terms and provisions of these By-Laws applicable to
Series Common Stock, and no such transferee of Series Common Stock shall be
entered on the records of the Corporation as a holder of Series Common Stock
unless such transferee files with the Corporation a written acknowledgment of
the applicability of these By-Laws to his Series Common Stock.
SECTION 9.3 Right of First Refusal. In the event any holder of Series
Common Stock desires to accept a bone fide third-party offer to purchase any or
all of the Series Common Stock held by him (such shares to be hereafter called
the "Target Shares"), the holder shall promptly i) deliver to the Secretary of
the Corporation written notice of the offer and the basic terms and conditions
thereof, including the proposed purchase price, and (ii) provide satisfactory
proof that the disposition of the Target Shares to the third-party offeror would
not be in contravention of applicable federal and state securities laws.
SECTION 9.4 Exercise of Right. The Corporation shall, for a period of
thirty (30) days following receipt of the notice of intended disposition, have
the right to purchase any or all of the Target Shares upon substantially the
same terms and conditions specified in such notice.
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However, should the third party offer involve other than cash consideration for
the Target Shares, then the Board of Directors shall have the authority to make
a good faith determination of the fair market value of the offered consideration
and may effect the purchase of the Target Shares by making a cash payment equal
to the value of the offered consideration as determined by the Board of
Directors. The Corporation's repurchase right shall be exercisable by written
notice delivered to the holder of the Target Shares prior to the expiration of
the thirty (30) day exercise period. If such right is exercised, the Corporation
shall effect its purchase of the Target Shares, including payment of the
purchase price, not more than thirty (30) days thereafter; and at such time the
holder of the Target Shares shall deliver to the Corporation the certificates
representing the Target Shares to be purchased, each certificate to be properly
endorsed for transfer.
SECTION 9.5 Non-Exercise of Right. In the event written notice of
exercise of the purchase right is not given to the holder of the Target Shares
within thirty (30) days following the date of the Corporation's receipt of the
notice of intended disposition, the holder shall, for a period of thirty (30)
days thereafter have the right to sell or otherwise dispose of the Target Shares
upon terms and conditions (including the purchase price) no more favorable to
the third party purchaser than those specified in the notice of intended
disposition given to the Corporation; provided, however, that the holder must
first obtain the Corporation's written approval of the sale or disposition in
accordance with Section 9.2 above and effect such sale or disposition in
compliance with applicable federal and state securities laws and not in
contravention of any contractual restrictions to which the holder is bound. The
third party purchaser shall acquire the Target Shares subject to the terms and
provisions of these By-Laws applicable to Series Common Stock and shall not make
any subsequent disposition of the Target Shares without complying with such
terms and provisions. The third party purchaser shall not be entered on the
records of the Corporation as a holder of the Target Shares unless such
individual files with the Corporation a written acknowledgment of the
applicability of these By-Laws to his Series Common Stock. In the event the
holder does not sell or otherwise dispose of the Target Shares within the
specified thirty (30) day period, the Corporation's right of first refusal shall
continue to be applicable to any sub-sequent disposition of the Target Shares by
the holder.
SECTION 9.6 Assignment. The Corporation may assign its purchase rights
under these By-Laws to any person or entity selected by the Board of Directors.
SECTION 9.7 Legend. All certificates representing shares of Series
Common Stock shall be endorsed with the following legend:
"The shares represented by this certificate are subject to certain
restrictions on transfer and repurchase rights in favor of the
Corporation. Such repurchase rights and transfer restrictions are set
forth in the Corporation's By-Laws, and a copy of the applicable
provisions of the By-Laws may be obtained upon written request to the
Secretary of the Corporation."
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SECTION 9.8 Notices. Any notice required in connection with the
exercise of the Corporation's right of first refusal or in connection with the
disposition of any Series Common Stock shall be given in writing and shall be
deemed effective upon personal delivery or upon deposit in the United States
mail, registered or certified, postage prepaid and addressed to the party
entitled to such notice at the address of record.
SECTION 9.9 Contractual Restrictions. The restriction on the
transferability of the Series Common Stock imposed by these By-Laws shall not
preclude the Corporation from imposing additional restrictions on
transferability as a condition for the issuance of one or more shares of Series
Common Stock.
ARTICLE X
Indemnification
---------------
SECTION 10.1 General. Each person who at any time is or shall have
been a Director, officer, employee or agent of this Corporation, or is or shall
have been serving at the request of the Corporation as a Director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, and the heirs, executors arid administrators of any such
person shall be indemnified by this Corporation in accordance with and to the
full extent permitted by the Delaware General corporation Law as in effect from
time to time.
If authorized by the Board of Directors, the Corporation may purchase
and maintain insurance on behalf of any person to the full extent permitted by
the Delaware General Corporation Law as in effect at the time of the adoption of
this By-Law or as amended from time to time.
ARTICLE XI
General Provisions
------------------
SECTION 11.1 Fiscal Year. The fiscal year of the Corporation shall
begin on the first day of March of each year and end on the last day of February
of the next succeeding calendar year.
SECTION 11.2 Seal. The corporate seal shall have inscribed thereon the
name of the Corporation, and the words "CORPORATE SEAL" and "DELAWARE" and it
shall otherwise be in the form approved by the Board of Directors. Such seal may
be used by causing it, or a facsimile thereof, to be impressed or affixed or
otherwise reproduced.
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ARTICLE XII
Amendments
----------
SECTION 12.1 In General. Any provision of these By-laws may be
altered, amended or repealed from time to time by the affirmative vote of the
holders of capital stock of the Corporation, having a majority of the voting
power thereof, present in person or represented by proxy at any annual meeting
of Stockholders at which a quorum is present, or at any special meeting of
Stockholders at which a quorum is present, if notice of the proposed alteration,
amendment or repeal be contained in the notice of such special meeting, or by
the affirmative vote of a majority of the Directors then qualified and acting at
any regular or special meeting of the Board of Directors; provided, however,
that the Stockholders may provide specifically for limitations on the power of
Directors to amend particular By-Laws and, in such event, the Directors' power
of amendment shall be so limited; and further provided that no reduction in the
number of Directors shall have the effect of removing any Director prior to the
expiration of his term of office.
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Exhibit 4
----------
FIRST AMENDMENT TO RIGHTS AGREEMENT
THIS FIRST AMENDMENT to the Rights Agreement (the "Rights Agreement")
dated as of June 20, 1996, between Material Sciences Corporation, a Delaware
corporation (the "Company") and ChaseMellon Shareholder Services, L.L.C., as
Rights Agent, is dated as of the 17th day of June 1998.
WHEREAS, the Board of Directors of the Company believes that it is in
the best interests of the Company and its stockholders to change the definitions
of "Acquiring Person" and "Distribution Date" set forth in the Rights Agreement
to lower the threshold amount upon which a beneficial owner of shares of the
Company's Common Stock becomes an Acquiring Person and upon which a beneficial
owner triggers the Distribution Date under the Rights Agreement;
WHEREAS, the Board of Directors of the Company believes that it is in
the best interests of the Company and its stockholders that the Rights Agreement
be amended as set forth herein; and
WHEREAS, Section 27 of the Rights Agreement authorizes the Board of
Directors of the Company and the Rights Agent to adopt the proposed amendment
without the approval of the holders of the Rights.
NOW, THEREFORE, in consideration of the recitals (which are deemed to
be a part of this Amendment) and agreements contained herein, the parties hereto
agree to amend the Rights Agreement as follows:
1. Section 1(a) of the Rights Agreement is hereby deleted in its
entirety and the following provision is inserted in lieu thereof:
"Acquiring Person" shall mean any Person who or which, together with
all Affiliates and Associates of such Person, is (or has previously been,
at any time after the date of this Agreement, whether or not such Person(s)
continues to be) the Beneficial Owner of 15% or more of the shares of
Common Stock then outstanding (determined without taking into account any
securities exercisable or exchangeable for, or convertible into, Common
Stock, other than any such securities beneficially owned by the Acquiring
Person and Affiliates and Associates of such Person). However, "Acquiring
Person" shall not include any Exempt Person.
A Person shall not become an "Acquiring Person" solely as a result of
(i) an acquisition of the shares of Common Stock by the Company which, by
reducing the number of shares outstanding, increases the proportionate
number of shares beneficially owned by such Person to 15% or more of the
shares of Common Stock then outstanding as determined above, or (ii) such
Person becoming the Beneficial Owner of 15% or more of the shares of Common
Stock then outstanding as
<PAGE>
determined above solely as a result of an Exempt Event; provided, however,
that if a Person becomes the Beneficial Owner of 15% or more of the shares
of Common Stock then outstanding as determined above solely by reason of
such a share acquisition by the Company or the occurrence of such an Exempt
Event and such Person shall, after becoming the Beneficial Owner of such
shares of Common Stock, become the Beneficial Owner of any additional
shares of Common Stock by any means whatsoever (other than as a result of
the subsequent occurrence of an Exempt Event, a stock dividend or a
subdivision of the shares of Common Stock into a larger number of shares or
a similar transaction), then such Person shall be deemed to be an
"Acquiring Person."
2. Section 1(l) of the Rights Agreement is hereby deleted in its
entirety and the following is inserted in lieu thereof:
"Distribution Date" shall mean the earlier of (i) the tenth day after
the Stock Acquisition Date or (ii) the tenth day after the date (the "Offer
Date") of the commencement by any Person (other than an Exempt Person) of,
or first public disclosure of an intention to commence by any Person (other
than an Exempt Person), a tender offer or exchange offer the consummation
of which would result in any Person having beneficial ownership of 15% or
more of the then outstanding shares of Common Stock (including any Stock
Acquisition Date or Offer Date which is after the date of this Agreement
and prior to the issuance of the Rights).
3. Capitalized terms used but not defined herein shall have the
meaning assigned to such terms in the Rights Agreement.
4. Except as expressly amended hereby, the Rights Agreement remains in
full force and effect.
5. This Amendment shall be deemed to be a contract made under the laws
of the State of Delaware, and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts made
and performed entirely within such State.
6. This Amendment 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.
* * * * * * * *
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be duly executed as of the day and year first written above.
MATERIAL SCIENCES CORPORATION
Attest:
By: By:
---------------------------- ---------------------------------
Name: Name: Gerald G. Nadig
Title: Title: Chairman, President and Chief
Executive Officer
CHASEMELLON SHAREHOLDER
SERVICES, L.L.C.
Attest:
By: By:
---------------------------- ---------------------------------
Name: Name:
Title: Title:
