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
HEALTH CARE REIT, INC.
(Exact name of registrant as specified in its charter)
Delaware 34-1096634
(State of incorporation (I.R.S. Employer
or organization) Identification No.)
One SeaGate, Suite 1950, P.O. Box 1475, Toledo, Ohio 43603-1475
(Address of principal executive offices) (Zip Code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of exchange on which
to be so registered each class is to be registered
Rights to Purchase Junior New York Stock Exchange
Participating Preferred Stock
Series A, parvalue $1.00 per
Share
Title of Case
Not Applicable
Securities to be registered pursuant to Section 12(g) of the Act:
This Document contains ___ pages. The Exhibit Index is located on
page five.
INFORMATION REQUIRED IN REGISTRATION STATEMENT
Item 1. Description of Registrant's Securities to be Registered.
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES
On July 19, 1994, the Board of Directors of Health Care
REIT, Inc. (the "Company") authorized the issuance of one preferred
share purchase right (a "Right") for each outstanding share of
common stock, par value $1.00 per share (the "Common Shares"), of
the Company. The distribution is payable on July 29, 1994 to the
stockholders of record at the close of business on August 5, 1994
(the "Record Date"), and with respect to all Common Shares that
become outstanding after the Record Date and prior to the earliest
of the Distribution Date (as defined below), the redemption of the
Rights, the exchange of the Rights, and the expiration of the
Rights (and, in certain cases, following the Distribution Date).
Each Right entitles the registered holder to purchase from the
Company one one-thousandth of a share of a Junior Participating
Preferred Stock, Series A, par value $1.00 per share, of the
Company (the "Preferred Shares") at a price of $48 per one one-
thousandth of a Preferred Share (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights are set forth
in a Rights Agreement (the "Rights Agreement") between the Company
and Chemical Bank, as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) the expiration of the
Company's redemption rights following the date of public disclosure
that a person or group other than certain exempt persons (an
"Acquiring Person"), together with persons affiliated or associated
with such Acquiring Person (other than those that are exempt
persons), has acquired, or obtained the right to acquire,
beneficial ownership of 15% or more of the outstanding Common
Shares (the "Stock Acquisition Date") or (ii) the tenth day after
the date of commencement or public disclosure of an intention to
commence a tender offer or exchange offer by a person other than an
exempt person if, upon consummation of the offer, such person could
acquire beneficial ownership of 15% or more of the outstanding
Common Shares (the earlier of such dates being called the
"Distribution Date"), the Rights will be evidenced by Common Share
certificates and not by separate certificates. The Rights
Agreement provides that, until the Distribution Date (or earlier
redemption, exchange or expiration of the Rights), the Rights will
be transferred with and only with the Common Shares. Until the
Distribution Date (or earlier redemption, exchange or expiration of
the Rights), new Common Share certificates issued after August 5,
1994, upon transfer or new issuance of the Common Shares, will
contain a notation incorporating the Rights Agreement by reference.
Until the Distribution Date (or earlier redemption, exchange or
expiration of the Rights) the surrender for transfer of any
certificate for Common Shares, with or without such notation or a
copy of this Summary of Rights being attached thereto, will also
constitute the transfer of the Rights associated with the 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 as of the close of business on the
Distribution Date, and such separate Right Certificates alone will
evidence the Rights.
The Rights will first become exercisable after the
Distribution Date (unless sooner redeemed or exchanged). The
Rights will expire at the close of business on August 5, 2004 (the
"Expiration Date"), unless earlier redeemed or exchanged by the
Company as described below.
The Purchase Price payable, and the number of Preferred
Shares or other securities, cash or other 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 or
distribution on, or a subdivision, combination or reclassification
of, the Preferred Shares, (ii) upon the grant to holders of the
Preferred Shares of certain rights, options or warrants to
subscribe for Preferred Shares or securities convertible into
Preferred Shares at less than the current market price of the
Preferred Shares or (iii) upon the distribution to holders of the
Preferred Shares of evidences of indebtedness or assets (excluding
regular periodic cash dividends out of earnings or retained
earnings) or of subscription rights or warrants (other than those
referred to above). In addition, the Purchase Price payable and
the number of Preferred Shares purchasable, on exercise of a Right
is subject to adjustment in the event that the Company should (i)
declare or pay any dividend on the Common Shares payable in Common
Shares or (ii) effect a subdivision or combination of the Common
Shares into a different number of Common Shares.
In the event that, at any time following public
disclosure that an Acquiring Person has become such, the Company is
involved in a merger or other business combination transaction
where the Company is not the surviving corporation or where Common
Stock is changed or exchanged or in a transaction or transactions
wherein 50% or more of its consolidated assets or earning power are
sold, proper provision would be made so that each holder of a Right
(other than such Acquiring Person and certain related persons or
transferees) 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 of the acquiring company or
the Company, as the case may be, 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 there is public disclosure
that an Acquiring Person has become such, proper provision would be
made so that each holder of a Right, other than Rights that are or
were beneficially owned by the Acquiring Person and certain related
persons and transferees (which will thereafter be void), on or
after the earlier of the Distribution Date and the first public
disclosure that an Acquiring Person has become such, will
thereafter have the right to receive upon exercise that number of
Common Shares having at the time of such transaction a market value
of two times the exercise price of the Right. In addition, the
Company's Board of Directors has the option of exchanging all or
part of the Rights (excluding void Rights) for an equal number of
Common Shares in the manner described in the Rights Agreement.
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
Preferred Shares will be issued (other than fractions which are
integral multiples of one one-thousandth of a Preferred Share,
which may, at the election of the Company, be evidenced by
depositary receipts) and in lieu thereof, an adjustment in cash
will be made based on the market price of the Preferred Shares on
the last trading date prior to the date of exercise.
At any time on or before public disclosure that an
Acquiring Person has become such, the Board of Directors of the
Company may redeem the Rights in whole, but not in part, at a price
of $.01 per Right (the "Redemption Price"), provided that, if any
person has become an Acquiring Person or there has been a change
(resulting from one or more proxy or consent solicitations) in a
majority of the directors in office at the commencement of the
first such solicitation if any person who is a participant in any
such solicitation has stated (or, if upon the commencement of any
such solicitation, a majority of the continuing directors has
determined in good faith) that such person (or any of its
affiliates or associates) intends to take, or may consider taking,
any action that would result in such person (or any of its
affiliates or associates) becoming an Acquiring Person or that
would cause the occurrence of a business combination with or
involving such person (or any of its affiliates or associates),
then any redemption of the Rights must be concurred in by a
majority of continuing directors. Immediately upon action of the
Board of Directors ordering redemption of the Rights, the ability
of holders to exercise the Rights will terminate and the only
rights of such holders will be to receive the Redemption Price.
At any time on or before a public disclosure that an
Acquiring Person has become such, the Board of Directors of the
Company may amend or supplement the Rights Agreement without the
approval of the Rights Agent or any holder of the Rights, except
for an amendment or supplement which would change the Redemption
Price, the final expiration date of the Rights or the Purchase
Price. Thereafter, the Board of Directors of the Company may amend
or supplement the Rights Agreement without such approval only to
increase the benefits to holders of the Rights or to create new
interests in such holders. However, under the circumstances
referred to in the preceding paragraph, any such amendment or
supplement must be concurred in by a majority of the continuing
directors. Immediately upon the action of the Board of Directors
providing for any amendment or supplement, such amendment or
supplement will be deemed effective.
The Preferred Shares purchasable upon exercise of the
Rights will not be redeemable. Each Preferred Share will be
entitled to a minimum preferential quarterly dividend payment equal
to the greater of $25 per share and 1,000 times the dividend
declared per Common Share. In the event of liquidation, the
holders of the Preferred Shares will be entitled to a minimum
preferential liquidation payment equal to the greater of $100 per
share and 1,000 times the payment made per Common Share. Each
Preferred Share will have 1,000 votes per share, voting together
with the Common Shares. In the event of any merger, consolidation
or other transaction in which Common Shares are exchanged, each
Preferred Share will be entitled to receive 1,000 times the amount
received per Common Share. These rights are protected by customary
antidilution provisions.
The Rights have certain anti-takeover effects. The
Rights may cause substantial dilution to a person or group other
than an exempt person that attempts to acquire the Company on terms
not approved by the Board, except pursuant to an offer conditioned
on a substantial number of Rights being acquired. The Rights
should not interfere with any merger or other business combination
approved by the Board of Directors prior to the time a person or
group other than an exempt person has acquired beneficial ownership
of 15% or more of the Common Shares, because until such time the
Rights may generally be redeemed by the Company at $.01 per Right.
Until a Right is exercised, the holder thereof, as such,
will have no rights as a stockholder of the Company, including,
without limitation, the right to vote or to receive dividends.
Item 2. Exhibits.
Exhibit No. Description
1 Specimen of Rights Certificate.
2 Form of Rights Agreement between Regis-
trant and Chemical Bank, as Rights Agent.
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the
Securities Exchange Act of 1934, the Registrant has duly caused
this registration statement to be signed on its behalf by the
undersigned, thereto duly authorized.
HEALTH CARE REIT, INC.
("Registrant")
Dated: August 1, 1994 By: /S/BRUCE G. THOMPSON
Chairman of the Board and
Chief Executive Officer
<PAGE>
EXHIBIT INDEX
Exhibit Number Description
1 Specimen of Rights Certificate
2 Form of Rights Agreement between
Registrant and Chemical Bank, as
Rights Agent
Exhibit A
FORM OF
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
OF JUNIOR PARTICIPATING PREFERRED STOCK, SERIES A
OF
HEALTH CARE REIT, INC.
Pursuant to Section 151 of the Corporation Law
of the State of Delaware
We, Bruce G. Thompson, Chairman of the Board of Directors
and Chief Executive Officer, and Erin C. Ibele, Vice President and
Corporate Secretary, of Health Care REIT, Inc., a corporation
organized and existing under the General Corporation Law of the
State of Delaware, in accordance with the provisions of Section 151
thereof, DO HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board
of Directors by the Second Restated Certificate of Incorporation of
the said Corporation, the said Board of Directors on July 19, 1994,
adopted the following resolution creating a series of thirteen
thousand (13,000) shares of Preferred Stock designated as Junior
Participating Preferred Stock, Series A:
RESOLVED, that pursuant to the authority vested in the
Board of Directors of this Corporation in accordance with the
provisions of its Second Restated Certificate of Incorporation a
series of Preferred Stock of the Corporation be, and it hereby is,
created, and that the designation and amount thereof and the voting
powers, preferences and relative, participating, optional and other
special rights of the shares of such series, and the
qualifications, limitations or restrictions thereof are as follows:
Section 1. Designation and Amount. The shares of such
series shall be designated as "Junior Participating Preferred
Stock, Series A" (the "Series A Preferred Stock") and the number of
shares constituting such series shall be thirteen thousand
(13,000).
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the
holders of any shares of any series of Preferred Stock ranking
prior and superior to the shares of Series A Preferred Stock with
respect to dividends, the holders of shares of Series A Preferred
Stock, in preference to the holders of Common Stock, par value
$1.00 per share, of the Corporation (the "Common Stock") and of any
other junior stock, shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available
for the purpose, quarterly dividends payable in cash on the
fifteenth day of March, June, September and December in each year
(each such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend Payment
Date after the first issuance of a share or fraction of a share of
Series A Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to the greater of (a) $25.00 or (b) subject to
the provision for adjustment hereinafter set forth, 1,000 times the
aggregate per share amount of all cash dividends, and 1,000 times
the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions other than a dividend payable in
shares of Common Stock or a subdivision of the outstanding shares
of Common Stock (by reclassification or otherwise), declared on the
Common Stock since the immediately preceding Quarterly Dividend
Payment Date or, with respect to the first Quarterly Dividend
Payment Date, since the first issuance of any share or fraction of
a share of Series A Preferred Stock. In the event the Corporation
shall at any time on or after August 5, 1994, declare or pay any
dividend on Common Stock payable in shares of Common Stock, or
effect a subdivision of combination or consolidation of the
outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock)
into a greater or lesser number of shares of Common Stock, then in
each such case the amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event under
clause (b) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of which is the
number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distri-
bution on the Series A Preferred Stock as provided in
paragraph (A) of this Section immediately after it declares a
dividend or distribution on the Common Stock (other than a dividend
payable in shares of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on the Common
Stock during the period between any Quarterly Dividend Payment Date
and the next subsequent Quarterly Dividend Payment Date, a dividend
of $25.00 per share on the Series A Preferred Stock shall neverthe-
less be payable on such subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be
cumulative on outstanding shares of Series A Preferred Stock from
the Quarterly Dividend Payment Date next preceding the date of
issue of such shares of Series A Preferred Stock, unless the date
of issue of such shares is prior to the record date for the first
Quarterly Dividend Payment Date, in which case dividends on such
shares shall begin to accrue from the date of issue of such shares,
or unless the date of issue is a Quarterly Dividend Payment Date or
is a date after the record date for the determination of holders of
shares of Series A Preferred Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment Date, in either
of which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued but
unpaid dividends shall not bear interest. Dividends paid on the
shares of Series A Preferred Stock in an amount less than the total
amount of such dividends at the time accrued and payable on such
shares shall be allocated pro rata on a share-by-share basis among
all such shares at the time outstanding. The Board of Directors
may fix a record date for the determination of holders of shares of
Series A Preferred Stock entitled to receive payment of a dividend
or distribution declared thereon, which record date shall be not
more than 60 days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of
Series A Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment
hereinafter set forth, each share of Series A preferred Stock shall
entitle the holder thereof to 1,000 votes on all matters submitted
to a vote of the stockholders of the Corporation. In the event the
Corporation shall at any time on or after August 5, 1994, declare
or pay any dividend on Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock)
into a greater or lesser number of shares of Common Stock, then in
each such case the number of votes per share to which holders of
shares of Series A Preferred Stock were entitled immediately prior
to such event shall be adjusted by multiplying such number by a
fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator
of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) Except as otherwise provided herein or by law,
the holders of shares of Series A Preferred Stock and the holders
of shares of Common Stock shall vote together as one class on all
matters submitted to a vote of stockholders of the Corporation.
(C) Except as set forth herein, holders of Series
A Preferred Stock shall have no special voting rights and their
consent shall not be required (except to the extent they are
entitled to vote with holders of Common Stock as set forth herein)
for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends
or distributions payable on the Series A Preferred Stock as
provided in Section 2 are in arrears, thereafter and until all
accrued and unpaid dividends and distributions, whether or not
declared, on shares of Series A Preferred Stock outstanding shall
have been paid in full, the Corporation shall not:
(i) declare or pay dividends on, or make any
other distributions on, any shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding up) to
the Series A Preferred Stock;
(ii) declare or pay dividends on or make any
other distributions on any shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or winding
up) with the Series A Preferred Stock, except dividends paid
ratably on the Series A Preferred Stock and all such parity stock
on which dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares are then
entitled;
(iii) redeem or purchase or otherwise acquire
for consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such
junior stock in exchange for shares of any stock of the Corporation
ranking junior (either as to dividends or upon dissolution,
liquidation or winding up) to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock, or any shares
of stock ranking on a parity with the Series A Preferred Stock,
except in accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend rates and
other relative rights and preferences of the respective series and
classes, shall determine in good faith will result in fair and
equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary
of the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the Corporation unless the
Corporation could, under paragraph (A) of this Section 4, purchase
or otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A
Preferred Stock purchased or otherwise acquired by the Corporation
in any manner whatsoever shall be retired and cancelled promptly
after the acquisition thereof. All such shares shall upon their
cancellation become authorized but unissued shares of preferred
stock and may be reissued as part of a new series of preferred
stock to be created by resolution or resolutions of the Board of
Directors, subject to the conditions and restrictions on issuance
set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. Upon
any liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (1) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock unless,
prior thereto, the holders of shares of Series A Preferred Stock
shall have received $100 per share, plus an amount equal to accrued
and unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment, provided that the holders of
shares of Series A Preferred Stock shall be entitled to receive an
aggregate amount per share, subject to the provision for adjustment
hereinafter set forth, equal to 1,000 times the aggregate amount to
be distributed per share to holders of Common Stock, or (2) to the
holders of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except distributions made ratably on the Series A
Preferred Stock and all other such parity stock in proportion to
the total amounts to which the holders of all such shares are
entitled upon such liquidation, dissolution or winding up. In the
event the Corporation shall at any time on or after August 5, 1994,
declare or pay any dividend on Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the aggregate amount to
which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under the proviso in clause (1) of
the preceding sentence shall be adjusted by multiplying such amount
by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger, combination
or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash
and/or any other property, then in any such case the shares of
Series A Preferred Stock then outstanding shall at the same time be
similarly exchanged or changed in an amount per share (subject to
the provision for adjustment hereinafter set forth) equal to 1,000
times the aggregate amount of stock, securities, cash and/or any
other property (payable in kind), as the case may be, into which or
for which each share of Common Stock is changed or exchanged. In
the event the Corporation shall at any time on or after August 5,
1994, declare or pay any dividend on Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or consoli-
dation of the outstanding shares of Common Stock (by reclassifi-
cation or otherwise) into a greater or lesser number of shares of
Common Stock, then in each such case the amount set forth in the
preceding sentence with respect to the exchange or change of shares
of Series A Preferred Stock shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of shares
of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series A
Preferred Stock shall not be redeemable.
Section 9. Amendment. The Second Restated Certificate
of Incorporation of the Corporation shall not be amended in any
manner which would materially alter or change the powers,
preferences or special rights of the Series A Preferred Stock so as
to affect them adversely without the affirmative vote of the
holders of two-thirds of the outstanding shares of Series A
Preferred Stock, voting together as a single class.
IN WITNESS WHEREOF, we have executed and subscribed this
Certificate and do affirm the foregoing as true under the penalties
of perjury this ____ day of July, 1994.
__________________________________
Bruce G. Thompson, Chairman of the
Board and Chief Executive Officer
ATTEST:
_____________________________
Erin C. Ibele, Vice President
and Corporate Secretary
___________________________________________________________________
HEALTH CARE REIT, INC.
and
CHEMICAL BANK
Rights Agent
RIGHTS AGREEMENT
Dated as of July 19, 1994
__________________________________________________________________
<PAGE>
Table of Contents
Page
Recitals . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 1. Certain Definitions . . . . . . . . . . . . . 1
Section 2. Appointment of Rights Agent . . . . . . . . . 8
Section 3. Issuance of Rights Certificates . . . . . . . 8
Section 4. Form of Rights Certificates . . . . . . . . . 10
Section 5. Execution, Countersignature and Regis-
tration . . . . . . . . . . . . . . . . . . . 12
Section 6. Transfer, Division, Combination and
Exchange of Rights Certificates;
Mutilated, Destroyed, Lost or Stolen
Rights Certificates . . . . . . . . . . . . . 12
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights . . . . . . . . . . 13
Section 8. Cancellation and Destruction of Rights
Certificates . . . . . . . . . . . . . . . . . 16
Section 9. Reservation and Availability of
Preferred Stock . . . . . . . . . . . . . . . 16
Section 10. Preferred Stock Record Date . . . . . . . . . 18
Section 11. Adjustments to Purchase Price, Number
of Shares or Number of Rights . . . . . . . . 18
Section 12. Certification of Adjustments . . . . . . . . . 27
Section 13. Consolidation, Merger or Sale or
Transfer of Assets or Earning Power . . . . . 28
Section 14. Fractional Rights and Fractional
Shares . . . . . . . . . . . . . . . . . . . . 31
Section 15. Rights of Action . . . . . . . . . . . . . . . 32
Section 16. Agreement of Rights Holders Concerning
Transfer and Ownership of Rights . . . . . . . 33
Section 17. Rights Holder Not Deemed a Stockholder . . . . 33
Section 18. Concerning the Rights Agent . . . . . . . . . 33
Section 19. Merger of Consolidation or Change of
Name of Rights Agent . . . . . . . . . . . . . 34
Section 20. Duties of Rights Agent . . . . . . . . . . . . 35
Section 21. Change of Rights Agent . . . . . . . . . . . . 37
Section 22. Issuance of New Rights Certificates . . . . . 38
Section 23. Redemption of Certain Events . . . . . . . . . 38
Section 24. Notice of Certain Events . . . . . . . . . . . 39
Section 25. Notices . . . . . . . . . . . . . . . . . . . 40
Section 26. Supplements and Amendments . . . . . . . . . . 41
Section 27. Successors . . . . . . . . . . . . . . . . . . 42
Section 28. Benefits of this Agreement;
Determinations and Actions by the
Board of Directors . . . . . . . . . . . . . . 42
Section 29. Severability . . . . . . . . . . . . . . . . . 43
Section 30. Governing Law . . . . . . . . . . . . . . . . 43
Section 31. Counterparts . . . . . . . . . . . . . . . . . 43
Section 32. Descriptive Headings . . . . . . . . . . . . . 43
Section 33. Grammatical Construction . . . . . . . . . . . 43
Exhibit A -- Certificate of Designation, Preferences and Rights
of Junior Participating Preferred Stock, Series A
Exhibit B -- Form of Rights Certificate
Exhibit C -- Form of Summary of Rights
<PAGE>
RIGHTS AGREEMENT
Rights Agreement dated as of July 19, 1994, between
Health Care REIT, Inc., a Delaware corporation (the "Company") and
Chemical Bank, a New York banking corporation (the "Rights Agent").
W I T N E S S E T H
WHEREAS, the Board of Directors of the Company has
authorized and declared a dividend of one preferred share purchase
right (the "Right") for each share of Common Stock (as defined in
Section 1) outstanding on the Record Date (as defined in Section 1)
and has authorized the issuance of one Right for each share of
Common Stock issued between the Record Date and the Distribution
Date (as defined in Section 1), and, in certain cases following the
Distribution Date, each Right representing, as of the Record Date,
the right to purchase one one-thousandth of a share of Preferred
Stock (as defined in Section 1) upon the terms and subject to the
conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements set forth in this Agreement, the parties hereby
agree as follows:
Section 1. Certain Definitions. For purposes of this
Agreement, the following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person who or
which, together with all Affiliates and Associates of such Person,
shall be (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 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.
No Person shall become an "Acquiring Person" solely as
the result of (i) an acquisition of Common Stock by the Company
which, by reducing the number of shares outstanding, increases the
proportionate number of shares beneficially owned by such Person to
15% or more of the Common Stock then outstanding as determined
above, or (ii) such Person becoming the Beneficial Owner of 15% or
more of the Common Stock then outstanding as 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 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 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 Common Stock into a larger
number of shares or a similar transaction), then such Person shall
be deemed to be an "Acquiring Person."
(b) "Affiliate" of a Person shall have the meaning given
to such term in Rule 12b-2 of the General Rules and Regulations
under the Exchange Act, as in effect on the date of this Agreement;
provided that, for purposes of this Agreement, the term "Affiliate"
shall not include any Person that is an Exempt Person.
(c) "Associate" of a Person shall have the meaning
given to such term in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act, as in effect on the date of
this Agreement; provided that, for purposes of this Agreement, the
term "Associate" shall not include any Person that is an Exempt
Person.
(d) Except as provided below, a Person shall be deemed
the "Beneficial Owner" of, and shall be deemed to "beneficially
own," any securities:
(i) which such Person or any Affiliate or Associate
of such Person beneficially owns, directly or indirectly;
(ii) which such Person or any Affiliate or Associate
of such Person has, directly or indirectly, the right or obligation
(whether or not then exercisable or effective) to acquire pursuant
to any agreement, arrangement or understanding (whether or not in
writing), 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 Affiliate or Associate of such Person until such
tendered securities are accepted for purchase or exchange; and
provided further, that prior to the occurrence of a Triggering
Event, a Person shall not be deemed the Beneficial Owner of, or to
beneficially own, securities obtainable upon exercise of the
Rights;
(iii) which such Person or any Affiliate or Associate
of such Person has, directly or indirectly, the right (whether or
not then exercisable) to vote, or to direct the voting of, pursuant
to any agreement, arrangement or understanding (whether or not in
writing); provided, however, that a Person shall not be deemed the
Beneficial Owner of, or to beneficially own, any security pursuant
to this clause (iii) if the agreement, arrangement or understanding
to vote, or to direct the voting of, such security (A) arises
solely from a revocable proxy or consent given in response to a
public proxy or consent solicitation made pursuant to, and in
accordance with, the Exchange Act and applicable rules and
regulations thereunder and (B) is not also then reportable under
Item 6 (or any comparable or successor item) of Schedule 13D under
the Exchange Act (or any comparable or successor schedule or
report);
(iv) which such Person or any Affiliate or Associate
of such Person has "beneficial ownership" of (as determined
pursuant to Rule 13d-3 of the General Rules and Regulations under
the Exchange Act or any successor provision); or
(v) which are beneficially owned, directly or
indirectly, by any other Person or any Affiliate or Associate of
such other Person with whom such Person or any Affiliate or
Associate of such Person has any agreement, arrangement or
understanding (whether or not in writing) for the purpose of
acquiring, holding, voting (except pursuant to a revocable proxy as
described in subparagraph (iii) of this Section 1(d)) or disposing
of any securities of the Company.
Nothing in this Section 1(d) shall cause a Person engaged
in business as an underwriter of securities to be the "Beneficial
Owner" of, or to "beneficially own," any securities acquired
through such Person's participation in good faith in a firm
commitment underwriting until the expiration of 40 days after the
date of such acquisition.
Notwithstanding anything in this Agreement to the
contrary, for purposes of this Agreement, no Person shall be
treated as the "Beneficial Owner" of, or to "beneficially own," any
securities owned by any other Person that is an Exempt Person.
(e) "Business Combination" shall have the meaning set
forth in Section 13 of this Agreement.
(f) "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in the
State of Ohio are authorized or obligated by law or executive order
to close.
(g) "Close of Business" on any given date shall mean
5:00 p.m., Toledo, Ohio time, on such date; provided, however, that
if such date is not a Business Day it shall mean 5:00 p.m., Toledo,
Ohio time, on the next succeeding Business Day.
(h) "Common Stock" when used in any context applicable
prior to a Business Combination shall mean the Common Stock, $1.00
par value per share, of the Company (as the same may be changed by
reason of any combination, subdivision or reclassification of the
Common Stock). "Common Stock" when used with reference to any
Person (other than the Company prior to a Business Combination)
shall mean shares of capital stock of such Person (if such Person
is a corporation) of any class or series, or units of equity
interests in such Person (if such Person is not a corporation) of
any class or series, the terms of which shares or units do not
limit (as a fixed amount and not merely in proportional terms) the
amount of dividends or income payable or distributable on such
shares or units or the amount of assets distributable on such
shares or units upon any voluntary or involuntary liquidation,
dissolution or winding up of such Person and do not provide that
such shares or units are subject to redemption at the option of
such Person, or any shares of capital stock or units of equity
interests into which the foregoing shall be reclassified or
changed; provided, however, that if at any time there shall be more
than one such class or series of capital stock of or equity
interests in such Person, "Common Stock" of such Person shall
include all such classes and series substantially in the proportion
of the total number of shares or other units of each such class or
series outstanding at such time.
(i) "Continuing Director" shall mean (i) any member of
the Board of Directors of the Company, while such Person is a
member of the Board of Directors of the Company, who is not an
Acquiring Person (as defined herein), or an Affiliate or Associate
of an Acquiring Person or a representative, designee or nominee of
an Acquiring Person or of any such Affiliate or Associate, and who
was a member of the Board of Directors of the Company on the date
of this Agreement, and (ii) any Person who becomes a member of the
Board of Directors of the Company after the date of this Agreement,
while such Person is a member of the Board of Directors of the
Company, who is not an Acquiring Person, or an Affiliate or
Associate of an Acquiring Person, or a representative, designee or
nominee of an Acquiring Person or of any such Affiliate or
Associate, if such Person's nomination for election, or election,
to the Board of Directors of the Company is recommended or approved
by a majority of the Continuing Directors.
(j) "Current Market Price" per share of Common Stock,
Preferred Stock or Equivalent Shares on any date shall be deemed to
be the average of the daily closing prices per share of such Common
Stock, Preferred Stock or Equivalent Shares for the 30 consecutive
Trading Days (as such term is hereinafter defined) immediately
prior to such date for the purpose of any computation under this
Agreement except computations made pursuant to Section 11(a)(iv),
and for the Trading Day immediately prior to such date for the
purpose of any computation under Section 11(a)(iv); provided,
however, that in the event that the Current Market Price per share
of Common Stock, Preferred Stock or Equivalent Shares is determined
during a period following the announcement by the issuer of such
Common Stock, Preferred Stock or Equivalent Shares of (i) a
dividend or distribution on such Common Stock, Preferred Stock or
Equivalent Shares other than a regular quarterly cash dividend, or
(ii) any subdivision, combination or reclassification of such
Common Stock, Preferred Stock or Equivalent Shares, and prior to
the expiration of 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 such dividend, distribution,
subdivision, combination or reclassification. The closing price
for each Trading Day shall be the last sale price, regular way, on
such day, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, on such
day, 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 Stock, Preferred Stock or Equivalent 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 United States
national securities exchange on which the Common Stock, Preferred
Stock or Equivalent Shares are listed or admitted to trading or, if
the Common Stock, Preferred Stock or Equivalent Shares are not
listed or admitted to trading on any United States national
securities exchange, the last quoted sale price on such day or, if
not so quoted, the average of the high bid and low asked prices in
the over-the-counter market on such day, as reported by the
National Association of Securities Dealers, Inc. Automated
Quotation System ("NASDAQ") or such other system then in use. If
on such day the Common Stock, Preferred Stock or Equivalent Shares
are not quoted by any such organization, the average of the closing
bid and asked prices on such day as furnished by a professional
market maker making a market in the Common Stock, Preferred Stock
or Equivalent Shares selected by a majority of the Continuing
Directors (or if no Continuing Directors are then in office, the
Board of Directors of the Company) shall be used. If no such
market maker is making a market, the fair market value of such
shares on such day as determined in good faith by a majority of the
Continuing Directors (or if no Continuing Directors are then in
office, the Board of Directors of the Company) or the Board of
Directors of the issuer of such Common Stock, Preferred Stock or
Equivalent Shares shall be used, which determination shall be
described in a statement filed with the Rights Agent and shall be
binding and conclusive for all purposes. The term "Trading Day"
shall mean a day on which the principal United States national
securities exchange on which the Common Stock, Preferred Stock or
Equivalent Shares are listed or admitted to trading is open for the
transaction of business or, if the Common Stock, Preferred Stock or
Equivalent Shares are not listed or admitted to trading on any
United States national securities exchange, but are traded in the
over-the-counter market and reported by NASDAQ, then any day for
which NASDAQ reports the high bid and low asked prices in the over-
the-counter market, or if the Common Stock, Preferred Stock or
Equivalent Shares are not traded in the over-the-counter market and
reported by NASDAQ, then a Business Day. If the Common Stock,
Preferred Stock or Equivalent Shares have not been so listed or
admitted to trading for 30 or more Trading Days or traded in the
over-the-counter market and reported by NASDAQ for 30 or more
Trading Days, "Current Market Price" per share shall mean the fair
market value per share as determined in good faith by a majority of
the Continuing Directors (or, if no Continuing Directors are then
in office, the Board of Directors of the Company), whose
determination shall be described in a statement filed with the
Rights Agent and shall be binding and conclusive for all purposes.
(k) "Distribution Date" shall mean the earlier of
(i) the day after the Company's right to redeem the Rights pursuant
to Section 23(a)(i) expires and (ii) the tenth day after
commencement or public disclosure of an intention to commence
(including, without limitation, any such commencement or public
disclosure which occurs on or after the date of this Agreement and
prior to the issuance of the Rights) a tender offer or exchange
offer by a Person if, after acquiring the maximum number of
securities sought pursuant to such offer, such Person, or any
Affiliate or Associate of such Person, would be an Acquiring
Person.
(l) "Equivalent Shares" shall mean any class or series
of capital stock of the Company, other than the Preferred Stock,
which is entitled to participate on a proportional basis with the
Preferred Stock in dividends and other distributions, including
distributions upon the liquidation, dissolution or winding up of
the Company. In calculating the number of any class or series of
Equivalent Shares for purposes of Section 11, the number of shares,
or fractions of a share, of such class or series of capital stock
that is entitled to the same dividend or distribution as a whole
share of Preferred Stock shall be deemed to be one share.
(m) "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended, and any successor statute.
(n) "Exchange Date" shall mean the time at which the
Rights are exchanged pursuant to Section 11(a)(iv).
(o) "Exempt Event" shall mean with respect to any
Person, the acquisition by such Person of Beneficial Ownership of
Common Stock solely as a result of the occurrence of a Triggering
Event and the effect of such Triggering Event on the last proviso
of clause (ii) of the definition of Beneficial Owner, other than a
Triggering Event in which such Person becomes an Acquiring Person.
(p) "Exempt Person" shall mean (i) the Company, (ii) any
Subsidiary of the Company, (iii) any employee benefit plan of the
Company or of any Subsidiary of the Company, (iv) any Person
holding Common Stock for any such employee benefit plan or for
employees of the Company or of any Subsidiary of the Company
pursuant to the terms of any such employee benefit plan.
(q) "Expiration Date" shall mean the Close of Business
on the tenth anniversary of the Record Date.
(r) "Person" shall mean any individual, firm, corpora-
tion, partnership, joint venture, association, trust,
unincorporated organization or other entity, and shall include any
"group" as that term is used in Rule 13d-5(b) under the Exchange
Act (or any successor provision).
(s) "Preferred Stock" shall mean the Company's Junior
Participating Preferred Stock, Series A, $1.00 par value per share,
having the rights and preferences set forth in the Certificate of
Designation, Preferences and Rights of Junior Participating
Preferred Stock, Series A, attached hereto as Exhibit A.
(t) "Principal Party" shall mean (i) in the case of any
Business Combination described in clause (i), (ii) or (iii) of the
first sentence of Section 13(a), (A) the Person that is the issuer
of any securities into which shares of Common Stock of the Company
are converted or for which they are exchanged in such Business
Combination or, if there is more than one such issuer, the issuer
of the Common Stock which has the greatest aggregate market value
or (B) if no securities are so issued, the Person that survives or
results from the Business Combination or, if there is more than one
such Person, the Person the Common Stock of which has the greatest
aggregate market value, and (ii) in the case of any Business
Combination described in clause (iv) of the first sentence in
Section 13(a), the Person that receives the greatest portion of the
assets or earning power transferred pursuant to such Business
Combination or, if each Person that is a party to such Business
Combination receives the same portion of the assets or earning
power so transferred or if the Person receiving the greatest
portion of the assets or earning power cannot reasonably be
determined, whichever of such Persons is the issuer of the Common
Stock which has the greatest aggregate market value; provided,
however, that in any such case, if the Common Stock of such Person
is not at such time and has not been continuously over the
preceding 12-month period registered under Section 12 of the
Exchange Act and such Person is a direct or indirect Subsidiary of
one or more other Persons, then (x) "Principal Party" shall refer
to whichever of such other Persons has Common Stock that is and has
been continuously over the preceding 12-month period registered
under Section 12 of the Exchange Act; (y) if the Common Stocks of
two or more of such other Persons are and have been so registered,
"Principal Party" shall refer to whichever of such other Persons is
the issuer of the Common Stock which has the greatest aggregate
market value; or (z) if the Common Stock of none of such other
Persons has been so registered, "Principal Party" shall refer to
whichever of such other Persons (other than an individual) is the
Person which has the equity securities with the greatest aggregate
market value. In case such Person is owned, directly or
indirectly, by a joint venture formed by two or more Persons that
are not owned, directly or indirectly, by the same Person, the
rules set forth above shall apply to each of the chains of
ownership having an interest in such joint venture as if such
Person were a Subsidiary of both or all of such joint venturers and
the Principal Parties in each such chain shall bear the obligations
set forth in Section 13 in the same ratio as their direct or
indirect interests in such Person bear to the total of such
interests.
(u) "Purchase Price" with respect to each Right shall
initially be $48.00 per one one-thousandth of a share of Preferred
Stock, shall be subject to adjustment from time to time as provided
in Sections 11 and 13, and shall be payable in lawful money of the
United States of America in cash or by certified check or bank
draft payable to the order of the Company.
(v) "Record Date" shall mean the Close of Business on
August 5, 1994.
(w) "Redemption Date" shall mean the time at which the
Rights are scheduled to be redeemed as provided in Section 23.
(x) "Schedule 13D" and "Schedule 13G" have the meanings
assigned under Regulation 13D under the Exchange Act and include
any successor schedules or reports.
(y) "Securities Act" shall mean the Securities Act of
1933, as amended, and any successor statute.
(z) "Stock Acquisition Date" shall mean the first date
(including, without limitation, any such date which is on or after
the date of this Agreement and prior to the issuance of the Rights)
of public disclosure by the Company, an Acquiring Person or
otherwise that an Acquiring Person has become such.
(aa) "Subsidiary" shall have the meaning given to such
term in Rule 12b-2 of the General Rules and Regulations under the
Exchange Act, as in effect on the date of this Agreement.
(bb) "Summary of Rights" shall mean a summary of the
Rights, in substantially the form attached hereto as Exhibit C.
(cc) "Triggering Event" shall mean a Person becoming an
Acquiring Person.
Section 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company in
accordance with the terms and conditions hereof, and the Rights
Agent hereby accepts such appointment. The Company may from time
to time appoint such co-Rights Agents as it may deem necessary or
desirable.
Section 3. Issuance of Rights Certificates.
(a) Until the Distribution Date: (i) the Rights shall
be issued in respect of and shall be evidenced by the certificates
representing the shares of Common Stock issued and outstanding on
the Record Date and shares of Common Stock issued after the Record
Date and prior to the earliest of the Distribution Date, the
Redemption Date, the Exchange Date or the Expiration Date (which
certificates for Common Stock shall be deemed to also be
certificates evidencing the Rights), and not by separate
certificates; (ii) the registered holders of such shares of Common
Stock shall also be the registered holders of the Rights associated
with such shares; and (iii) the Rights shall be transferable only
in connection with the transfer of shares of Common Stock, and the
surrender for transfer of any certificate for such shares of Common
Stock shall also constitute the surrender for transfer of the
Rights associated with such shares. As soon as practicable after
the Company has notified the Rights Agent of the occurrence of the
Distribution Date, the Rights Agent shall mail, by first-class,
insured, postage prepaid mail, to each record holder of the Common
Stock as of the Close of Business on the Distribution Date, as
shown by the records of the Company, at the address of such holder
shown on such records, one or more certificates evidencing the
Rights ("Rights Certificates"), in substantially the form of
Exhibit B hereto, evidencing one Right (as adjusted from time to
time pursuant to this Agreement) for each share of Common Stock so
held. From and after the Distribution Date, the Rights will be
evidenced solely by such Rights Certificates. In the event that an
adjustment in the number of Rights per share of Common Stock has
been made pursuant to Section 11(o) of this Agreement, at the time
of distribution of the Rights Certificates, the Company may make
the necessary and appropriate adjustments (in accordance with
Section 14(a) of this Agreement) so that Rights Certificates
representing only whole numbers of Rights are distributed and cash
is paid in lieu of any fractional Rights.
(b) As soon as practicable after the Record Date, the
Company will send a copy of the Summary of Rights by first-class,
postage prepaid mail, to each record holder of Common Stock as of
the Close of Business on the Record Date, as shown by the records
of the Company, at the address of such holder shown on such
records.
(c) Rights shall be issued in respect of all shares of
Common Stock which are issued or sold by the Company after the
Record Date but prior to the earliest of the Distribution Date, the
Redemption Date, the Exchange Date and the Expiration Date. In
addition, in connection with the issuance or sale of Common Stock
by the Company following the Distribution Date and prior to the
earliest of the Redemption Date, the Exchange Date and the
Expiration Date, the Company shall, with respect to Common Stock so
issued or sold pursuant to (i) the exercise of stock options issued
prior to the Distribution Date or under any employee plan or
arrangement created prior to the Distribution Date, or (ii) upon
the exercise, conversion or exchange of securities issued by the
Company prior to the Distribution Date, issue Rights and Rights
Certificates representing the appropriate number of Rights in
connection with such issuance or sale; provided, however, that
(x) no such Rights and Rights Certificate shall be issued if, and
to the extent that, the Company shall be advised by counsel that
such issuance would create a significant risk of material adverse
tax consequences to the Company or the Person to whom such Rights
Certificate would be issued and (y) no such Rights and Rights
Certificates shall be issued, if, and to the extent that,
appropriate adjustment shall otherwise have been made in lieu of
the issuance thereof. Certificates issued after the Record Date
representing shares of Common Stock outstanding on the Record Date
or shares of Common Stock issued after the Record Date but prior to
the earliest of the Distribution Date, the Redemption Date, the
Exchange Date and the Expiration Date shall have impressed,
printed, or written on, or otherwise affixed to them a legend
substantially in the following form:
This certificate also evidences and entitles the holder
hereof to certain Rights as set forth in a Rights Agreement between
Health Care REIT, Inc. and Chemical Bank, as Rights Agent, dated as
of July 19, 1994 (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 Health Care REIT, Inc.
Under certain circumstances, as set forth in the Rights Agreement,
such Rights will be evidenced by separate certificates and will no
longer be evidenced by this certificate. Health Care REIT, Inc.
will mail to the holder of this certificate a copy of the Rights
Agreement without charge after receipt of a written request
therefor. Under certain circumstances, Rights that were, are or
become beneficially owned by Acquiring Persons or their Associates
or Affiliates (as such terms are defined in the Rights Agreement)
may become null and void and the holder of any of such Rights
(including any subsequent holder) shall not have any right to
exercise such Rights.
Section 4. Form of Rights Certificates.
(a) The Rights Certificates (and the form of election to
purchase shares and form of assignment to be printed on the reverse
thereof) shall be in substantially the form of Exhibit B hereto and
may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company
may deem appropriate and as are not inconsistent with the
provisions of this Agreement, or as may be required to comply with
any law or with any rule or regulation made pursuant thereto or
with any rule or regulation of any stock exchange on which the
Rights may from time to time be listed, or to conform to usage.
Subject to the provisions of this Agreement, the Rights
Certificates, whenever issued, shall be dated as of the
Distribution Date, and on their face shall entitle the holders
thereof to purchase such number of shares of Preferred Stock as
shall be set forth therein at the Purchase Price set forth therein,
but the number of such securities and the Purchase Price shall be
subject to adjustment as provided in this Agreement.
(b) Notwithstanding any other provision of this
Agreement, (i) any Rights Certificate issued pursuant to this
Agreement that represents Rights beneficially owned or formerly
beneficially owned, on or after the earlier of the Distribution
Date and the Stock Acquisition Date, by a Person known by the
Company to be: (A) an Acquiring Person or an Associate or
Affiliate of an Acquiring Person; (B) a direct or indirect
transferee of an Acquiring Person (or of an Associate or Affiliate
of such Acquiring Person) who becomes or becomes entitled to be a
transferee after the Acquiring Person becomes such; or (C) a direct
or indirect transferee of an Acquiring Person (or of an Associate
or Affiliate of such Acquiring Person) who becomes or becomes
entitled to be a transferee prior to or concurrently with the
Acquiring Person becoming such and receives such Rights pursuant to
either (x) a direct or indirect transfer (whether or not for
consideration) from the Acquiring Person (or from an Associate or
Affiliate of such Acquiring Person) to holders of equity interests
in such Acquiring Person (or to holders of equity interests in an
Associate or Affiliate of such Acquiring Person) or to any Person
with whom such Acquiring Person (or an Associate or Affiliate of
such Acquiring Person) has any continuing agreement, arrangement or
understanding regarding the transferred Rights or (y) a direct or
indirect transfer which a majority of the Continuing Directors (or,
if no Continuing Directors are then in office, the Board of
Directors of the Company) has determined is part of a plan,
arrangement or understanding which has as a primary purpose or
effect the avoidance of Section 7(e) of this Agreement, or (ii) any
Rights Certificate issued pursuant to this Agreement upon transfer,
exchange, replacement or adjustment of any other Rights Certificate
beneficially owned by a Person referred to in this Section 4(b),
shall contain (to the extent feasible) the following legend:
The Rights represented by this Rights Certificate are or
were beneficially owned by a Person who was or became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person (as such
terms are defined in the Rights Agreement). Accordingly, this
Rights Certificate and the Rights represented hereby may become
null and void in the circumstances specified in Section 7(e) of the
Rights Agreement.
Section 5. Execution, Countersignature and Registration.
(a) Each Rights Certificate shall be executed on behalf
of the Company by the Company's Chairman of the Board and Chief
Executive Officer, Vice Chairman of the Board, President and Chief
Operating Officer or any Vice President, either manually or by
facsimile signature, and shall have affixed thereto the Company's
seal or a facsimile thereof which shall be attested by the
Company's Secretary or an Assistant Secretary, either manually or
by facsimile signature. Each Rights Certificate shall be
countersigned by the Rights Agent either manually or, if permitted
by the Company, by facsimile signature and shall not be valid for
any purpose unless so countersigned. In case any officer of the
Company who shall have signed a Rights Certificate shall cease to
be such officer of the Company before countersignature by the
Rights Agent and issuance and delivery by the Company, such Rights
Certificate nevertheless may be countersigned by the Rights Agent
and issued and delivered with the same force and effect as though
the Person who signed such Rights Certificate had not ceased to be
such officer of the Company; and any Rights Certificate may be
signed on behalf of the Company by any Person who, at the actual
date of the execution of such Rights Certificate, shall be a proper
officer of the Company to sign such Rights Certificate, although at
the date of the execution of this Agreement any such Person was not
such an officer.
(b) Following the Distribution Date, the Rights Agent
shall keep or cause to be kept, at its principal corporate trust
office, books for registration and transfer of the Rights
Certificates issued hereunder. Such books shall show the names and
addresses of the respective holders of the Rights Certificates, the
number of Rights evidenced by each Rights Certificate, and the
certificate number and the date of issuance of each Rights
Certificate.
Section 6. Transfer, Division, Combination and Exchange of
Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights
Certificates.
(a) Subject to the provisions of Section 14, at any time
after the Close of Business on the Distribution Date and at or
prior to the Close of Business on the earliest of the Redemption
Date, the Exchange Date and the Expiration Date, any Rights
Certificate or Rights Certificates may be transferred, divided,
combined or exchanged for another Rights Certificate or Rights
Certificates, entitling the registered holder to purchase a like
number of shares of Preferred Stock (or other securities, cash or
other property, following a Triggering Event or a Business
Combination, as the case may be) as the Rights Certificate or
Rights Certificates surrendered then entitled such holder to
purchase. Any registered holder desiring to transfer, divide,
combine or exchange any Rights Certificate shall make such request
in writing delivered to the Rights Agent, and shall surrender the
Rights Certificate or Rights Certificates to be transferred,
divided, combined or exchanged at the principal corporate trust
office of the Rights Agent. Thereupon the Rights Agent shall
countersign and deliver to the Person entitled thereto a Rights
Certificate or Rights Certificates, as the case may be, as so
requested. As a condition to such transfer, division, combination
or exchange, the Company may require payment by the surrendering
holder of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection therewith. Neither the Rights
Agent nor the Company shall be obligated to take any action
whatsoever with respect to the transfer of any such surrendered
Rights Certificate until the registered holder shall have duly
completed and executed the form of assignment on the reverse side
of such Rights Certificate and shall have provided such additional
evidence of the identity of the Beneficial Owner (or such former or
proposed Beneficial Owner) thereof or such Beneficial Owner's
Affiliates or Associates as the Company shall reasonably request.
(b) Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft,
destruction or mutilation of a Rights Certificate, and, in case of
loss, theft or destruction, of indemnity or security reasonably
satisfactory to them, and reimbursement to the Company and the
Rights Agent of all reasonable expenses incidental thereto, and
upon surrender to the Rights Agent and cancellation of the Rights
Certificate if mutilated, the Company will make and deliver a new
Rights Certificate of like tenor to the Rights Agent for delivery
to the registered owner in lieu of the Rights Certificate so lost,
stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration
Date of Rights.
(a) Each Right shall entitle (except as otherwise
provided in this Agreement) the registered holder thereof, upon the
exercise thereof as provided in this Agreement, to purchase, for
the Purchase Price, at any time after the Distribution Date and
prior to the earliest of the Expiration Date, the Exchange Date and
the Redemption Date, one one-thousandth of a share of Preferred
Stock, subject to adjustment from time to time as provided in
Sections 11 and 13.
(b) The registered holder of any Rights Certificate may
exercise the Rights evidenced thereby (except as otherwise provided
in this Agreement) in whole or in part (except that no fraction of
a Right may be exercised) at any time on or after the Distribution
Date and prior to the earliest of the Expiration Date, the Exchange
Date and the Redemption Date, by surrendering the Rights
Certificate, with the form of election to purchase on the reverse
side thereof duly executed, to the Rights Agent at the principal
corporate trust office of the Rights Agent, together with payment
of the Purchase Price for each one one-thousandth of a share of
Preferred Stock (or other securities, cash or other assets, as the
case may be) as to which the Rights are exercised.
(c) Upon receipt of a Rights Certificate representing
exercisable Rights, with the form of election to purchase duly
executed, accompanied by payment of the Purchase Price for each one
one-thousandth of a share of Preferred Stock (or, following a
Triggering Event or a Business Combination, other securities, cash
or other assets, as the case may be) to be purchased and an amount
in cash, certified bank check or bank draft payable to the order of
the Company equal to any applicable transfer tax required to be
paid by the surrendering holder pursuant to Section 9(d), the
Rights Agent shall, subject to the provisions of this Agreement,
thereupon promptly (i)(A) requisition from any transfer agent for
the Preferred Stock (or make available, if the Rights Agent is the
transfer agent for such shares) certificates for the total number
of one one-thousandths of a share of Preferred Stock (or other
securities, as the case may be) to be purchased (and the Company
hereby irrevocably authorizes its transfer agent to comply with all
such requests), or (B) if the Company shall have elected to deposit
the total number of shares of Preferred Stock (or other securities,
as the case may be) issuable upon exercise of the Rights with a
depositary agent, requisition from the depositary agent depositary
receipts representing such number of one one-thousandths of a share
of Preferred Stock (or other securities, as the case may be) as are
to be purchased (in which case certificates for the Preferred Stock
(or other securities, as the case may be) represented by such
receipts shall be deposited by the transfer agent with the
depositary agent) and the Company shall direct the depositary agent
to comply with such request; (ii) after receipt of such certifi-
cates or depositary receipts, cause the same to be delivered to or
upon the order of the registered holder of such Rights Certificate,
registered in such name or names as may be designated by such
holder; and (iii) if appropriate, requisition from the Company the
amount of cash to be paid in lieu of issuance of fractional shares
in accordance with Section 14 of this Agreement and, promptly after
receipt thereof, cause the same to be delivered to or upon the
order of the registered holder of such Rights Certificate. In the
event that the Company is obligated to issue other securities
(including shares of Common Stock) of the Company, pay cash and/or
distribute other property pursuant to this Agreement, the Company
will make all arrangements necessary so that such other securities,
cash and/or other property are available for distribution by the
Rights Agent, if and when appropriate.
(d) In case the registered holder of any Rights
Certificate shall exercise less than all the Rights evidenced
thereby, a new Rights Certificate evidencing Rights equivalent to
the Rights remaining unexercised shall be issued by the Rights
Agent and delivered to the registered holder of such Rights
Certificate or to his duly authorized assigns, subject to the
provisions of Section 6 and Section 14.
(e) Notwithstanding anything in this Agreement to the
contrary, any Rights that are or were formerly beneficially owned
on or after the earlier of the Distribution Date or the Stock
Acquisition Date by (i) an Acquiring Person or any Associate or
Affiliate of an Acquiring Person, (ii) a direct or indirect
transferee of an Acquiring Person (or of an Associate or Affiliate
of such Acquiring Person) who becomes or becomes entitled to be a
transferee after the Acquiring Person becomes such, or (iii) a
direct or indirect transferee of an Acquiring Person (or of an
Associate or Affiliate of such Acquiring Person) who becomes or
becomes entitled to be a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a direct or indirect transfer (whether or
not for consideration) from the Acquiring Person (or from an
Associate or Affiliate of such Acquiring Person) to holders of
equity interests in such Acquiring Person (or to holders of equity
interests in any Associate or Affiliate of such Acquiring Person)
or to any Person with whom the Acquiring Person (or an Associate or
Affiliate of such Acquiring Person) has any continuing agreement,
arrangement or understanding regarding the transferred Rights or
(B) a direct or indirect transfer which a majority of the
Continuing Directors (or, if no Continuing Directors are then in
office, the Board of Directors of the Company) determines is part
of a plan, arrangement or understanding which has as a primary
purpose or effect the avoidance of this Section 7(e), shall,
immediately upon the occurrence of a Triggering Event and without
any further action, be null and void and no holder of such Rights
shall have any rights whatsoever with respect to such Rights
whether under this Agreement or otherwise, provided, however, that,
in the case of transferees under clause (ii) or clause (iii) above,
any Rights beneficially owned by such transferee shall be null and
void only if and to the extent such Rights were formerly
beneficially owned by a Person who was, at the time such Person
beneficially owned such Rights, or who later became, an Acquiring
Person or an Affiliate or Associate of such Acquiring Person. The
Company shall use all reasonable efforts to ensure that the
provisions of this Section 7(e) and Section 4(b) are complied with,
but shall have no liability to any holder of a Rights Certificate
or to any other Person as a result of the Company's failure to
make, or any delay in making (including any such failure or delay
by the Continuing Directors and/or the Board of Directors of the
Company) any determinations with respect to an Acquiring Person or
its Affiliates, Associates or transferees hereunder.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be
obligated to undertake any action with respect to the registered
holder of a Rights Certificate upon the occurrence of any purported
exercise as set forth in this Section 7 unless such registered
holder shall have (i) completed and signed the certificate
contained in the form of election to purchase set forth on the
reverse side of the Rights Certificate surrendered for such
exercise and (ii) provided such additional evidence of the identity
of the Beneficial Owner (or former or proposed Beneficial Owner)
thereof or the Affiliates or Associates of such Beneficial Owner
(or former or proposed Beneficial Owner) as the Company shall
reasonably request.
Section 8. Cancellation and Destruction of Rights
Certificates. All Rights Certificates surrendered for the purpose
of exercise, transfer, division, combination or exchange shall, if
surrendered to the Company or to any of its agents, be delivered to
the Rights Agent for cancellation or in canceled form, or, if
surrendered to the Rights Agent, shall be canceled by it, and no
Rights Certificates shall be issued in lieu thereof except as
expressly permitted by the provisions of this Agreement. The
Company shall deliver to the Rights Agent for cancellation and
retirement, and the Rights Agent shall so cancel and retire, any
other Rights Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall
deliver all canceled Rights Certificates to the Company, or shall,
at the written request of the Company, destroy such canceled Rights
Certificates, and in such case shall deliver a certificate of
destruction thereof to the Company.
Section 9. Reservation and Availability of Preferred Stock.
(a) The Company covenants and agrees that it will cause
to be reserved and kept available at all times out of its
authorized and unissued shares of Preferred Stock or its authorized
and issued shares of Preferred Stock held in its treasury (and,
following the occurrence of a Triggering Event, out of its
authorized and unissued shares of Common Stock and/or other
securities or out of its authorized and issued shares of Common
Stock and/or other securities held in its treasury) free from
preemptive rights or any right of first refusal, a sufficient
number of shares of Preferred Stock (and, following the occurrence
of a Triggering Event, shares of Common Stock and/or other
securities) to permit the exercise in full of all Rights from time
to time outstanding.
(b) The Company further covenants and agrees, so long as
the Preferred Stock (and, following the occurrence of a Triggering
Event, shares of Common Stock and/or other securities) issuable
upon the exercise of Rights may be listed on any United States
national securities exchange, to use its best efforts to cause,
from and after the time that the Rights become exercisable, all
such shares and/or other securities reserved for such issuance to
be listed on such exchange upon official notice of issuance upon
such exercise.
(c) The Company further covenants and agrees that it
will take all such action as may be necessary to ensure that all
shares of Preferred Stock (and, following the occurrence of a
Triggering Event or a Business Combination, shares of Common Stock
and/or other securities) delivered upon the exercise of Rights
shall, at the time of delivery of the certificates for such shares
and/or such other securities (subject to payment of the Purchase
Price), be duly and validly authorized and issued, fully paid,
nonassessable, freely tradeable, not subject to liens or
encumbrances, and free of preemptive rights, rights of first
refusal or any other restrictions or limitations on the transfer or
ownership thereof, of any kind or nature whatsoever.
(d) 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
original issuance or delivery of the Rights Certificates or of any
certificates for shares of Preferred Stock (or Common Stock and/or
other securities, as the case may be) upon the exercise of Rights.
The Company shall not, however, be required to (i) pay any transfer
tax which may be payable in respect of any transfer involved in the
issuance or delivery of any Rights Certificates or the issuance or
delivery of any certificates for shares of Preferred Stock (or
Common Stock and/or other securities as the case may be) to a
Person other than, or in a name other than that of, the registered
holder of the Rights Certificate evidencing Rights surrendered for
exercise or (ii) transfer or deliver any Rights Certificate or
issue or deliver any certificates for shares of Preferred Stock (or
Common Stock and/or other securities as the case may be) upon the
exercise of any Rights until any such tax shall have been paid (any
such tax being payable by the holder of such Rights Certificate at
the time of surrender) or until it has been established to the
Company's satisfaction that no such tax is due.
(e) The Company shall use its best efforts (i) as soon
as practicable following a Triggering Event (provided the
consideration to be delivered by the Company upon exercise of the
Rights has been determined in accordance with Section 11(a)(iii) of
this Agreement), or as soon as is required by law following the
Distribution Date, as the case may be, to prepare and file a
registration statement on an appropriate form under the Securities
Act with respect to the securities purchasable upon exercise of the
Rights, (ii) to cause such registration statement to become
effective as soon as practicable after such filing, and (iii) to
cause such registration statement to remain effective (with a
prospectus at all times meeting the requirements of the Securities
Act) until the earlier of (A) the date as of which Rights are no
longer exercisable for such securities and (B) the Expiration Date.
The Company shall also use its best efforts to take such action as
may be necessary or appropriate under, or to ensure compliance
with, the securities or "blue sky" laws of the various states in
connection with the exercise of the Rights. The Company may
temporarily suspend, for a period of time not to exceed 90 days
after the date of a Triggering Event described in clause (i) of the
first sentence of this paragraph of Section 9, the exercisability
of the Rights in order to prepare and file such registration
statement and permit it to become effective. Upon any such
suspension, the Company shall make a public announcement stating
that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the
suspension is no longer in effect. Notwithstanding any provision
of this Agreement to the contrary, the Rights shall not be
exercisable in any jurisdiction unless the requisite qualification
in such jurisdiction shall have been obtained and until a
registration statement has been declared effective.
Section 10. Preferred Stock Record Date. Each Person in
whose name any certificate for shares of Preferred Stock (or Common
Stock and/or other securities, as the case may be) is issued upon
the exercise of Rights shall for all purposes be deemed to have
become the holder of record of the Preferred Stock (or Common Stock
and/or other securities, as the case may be) represented thereby
on, and such certificate shall be dated, the date upon which the
Rights Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and any applicable transfer taxes)
was made; provided, however, that if the date of such surrender and
payment is a date upon which the Preferred Stock (or Common Stock
and/or other securities, as the case may be) transfer books of the
Company are closed, such Person shall be deemed to have become the
record holder of such shares (and/or such other securities, as the
case may be) on, and such certificate shall be dated, the next
succeeding Business Day on which the Preferred Stock (or Common
Stock and/or other securities, as the case may be) transfer books
of the Company are open.
Section 11. Adjustments to Purchase Price, Number of Shares
or Number of Rights. The Purchase Price, the number and kind of
securities, cash and other property obtainable upon exercise of
each Right and the number of Rights outstanding shall be subject to
adjustment from time to time as provided in this Section 11.
(a) (i) In the event the Company shall at any time on
or after the date of this Agreement (A) pay a dividend or make a
distribution on the Preferred Stock payable in shares of Preferred
Stock, (B) subdivide (by a stock split or otherwise) the
outstanding Preferred Stock into a larger number of shares,
(C) combine (by a reverse stock split or otherwise) the outstanding
Preferred Stock into a smaller number of shares, or (D) issue any
securities in a reclassification of the Preferred Stock (including
any such reclassification in connection with a consolidation or
merger in which the Company is the surviving corporation), then in
each such event the Purchase Price and the redemption price set
forth in Section 23, as each is in effect at the time of the record
date for such dividend or distribution, or of the effective date of
such subdivision, combination or reclassification, shall be
proportionately adjusted by multiplying the Purchase Price and such
redemption price by a fraction the numerator of which shall be the
total number of shares of Preferred Stock outstanding immediately
prior to the occurrence of such event and the denominator of which
shall be the total number of shares of Preferred Stock outstanding
immediately following the occurrence of such event. If an event
occurs which would require an adjustment under both this
Section 11(a)(i) and Section 11(a)(ii), the adjustment provided for
in this Section 11(a)(i) shall be in addition to, and shall be made
prior to, any adjustment required pursuant to Section 11(a)(ii).
(ii) Upon the first occurrence of a Triggering
Event, proper provision shall be made so that each holder of a
Right, except as otherwise provided in this Agreement, shall
thereafter have the right to receive, and the Company shall issue,
upon exercise thereof at the then-current Purchase Price required
to be paid in order to exercise a Right in accordance with the
terms of this Agreement, in lieu of the number of one one-
thousandths of a share of Preferred Stock or other securities
receivable upon exercise of a Right prior to the occurrence of the
Triggering Event, such number of shares of Common Stock of the
Company as shall equal the result obtained by (x) multiplying the
then-current Purchase Price by the number of one-thousandths of a
share of Preferred Stock or other securities for which a Right was
then exercisable (without giving effect to such Triggering Event)
and (y) dividing that product by 50% of the Current Market Price
per share of Common Stock on the date of the occurrence of the
Triggering Event (such number of shares being referred to as the
"Adjustment Shares"); provided, however, that if the transaction or
event that would otherwise give rise to the foregoing adjustment is
also subject to the provisions of Section 13 of this Agreement,
then only the provisions of Section 13 of this Agreement shall
apply and no adjustment shall be made pursuant to this
Section 11(a)(ii). Upon the occurrence of such Triggering Event,
the Purchase Price required to be paid in order to exercise a Right
shall be unchanged, and the Purchase Price shall be appropriately
adjusted to reflect, and shall thereafter mean, the amount required
to be paid per share of Common Stock upon exercise of a Right.
(iii) In lieu of issuing shares of Common Stock in
accordance with Section 11(a)(ii), the Company may, if a majority
of the Continuing Directors (or if no Continuing Directors are then
in office, the Board of Directors of the Company) determine that
such action is necessary or appropriate and not contrary to the
interests of holders of Rights (and, in the event that the number
of shares of Common Stock which are authorized by the Company's
certificate of incorporation, but which are not outstanding or
reserved for issuance for purposes other than upon exercise of the
Rights, are not sufficient to permit the exercise in full of the
Rights in accordance with Section 11(a)(ii), the Company shall)
take one or more of the following actions: (A) reduce the Purchase
Price required to be paid in order to exercise a Right by any
amount (the "Reduction Amount"), in which event the number of
Adjustment Shares and/or the amount of any Substitute Consideration
(as hereinafter defined) issuable in respect of each Right (the
Adjustment Shares, if any, and the Substitute Consideration, if
any, issuable in respect of a Right are herein collectively
referred to as the "Total Consideration") shall be reduced so that
the aggregate value of the Total Consideration issuable in respect
of each Right is equal to the Current Value (as hereinafter
defined) less the Reduction Amount (herein the "Adjusted Current
Value"), and/or (B) make adequate provision with respect to each
Right to substitute for all or part of the Adjustment Shares
otherwise obtainable upon exercise of a Right: (1) cash, (2) other
equity securities of the Company (including, without limitation,
shares, or units of shares, of preferred stock which a majority of
the Continuing Directors (or if no Continuing Directors are then in
office, the Board of Directors of the Company) have determined to
have the same value as shares of Common Stock (such shares or units
of preferred stock being referred to as "Common Stock
Equivalents")), (3) debt securities of the Company, (4) other
assets, or (5) any combination of the foregoing (collectively,
"Substitute Consideration"), having an aggregate value which, when
added to the value of the Adjustment Shares (if any) in respect of
which no substitution is being made, is equal to the Adjusted
Current Value. If a majority of the Continuing Directors (or if no
Continuing Directors are then in office, the Board of Directors)
determine to issue or deliver any equity securities (other than
Common Stock or Common Stock Equivalents), debt securities and/or
other assets pursuant to this Section 11(a)(iii), the value of such
securities and/or assets shall be determined by a majority of the
Continuing Directors (or if no Continuing Directors are then in
office, the Board of Directors of the Company) based upon the
advice of a nationally recognized investment banking firm selected
by a majority of the Continuing Directors (or if no Continuing
Directors are then in office, the Board of Directors of the
Company). If the Company is required to make adequate provision to
deliver value pursuant to the first sentence of this Section
11(a)(iii) and the Company shall not have made such adequate
provision to deliver value within ninety (90) days following the
first occurrence of a Triggering Event (the "Substitution Period"),
then notwithstanding any provision of Section 11(a)(ii) or this
Section 11(a)(iii) to the contrary, the Company shall be obligated
to deliver, upon the surrender for exercise of a Right and without
requiring payment of the Purchase Price, shares of Common Stock (to
the extent available) and then, if necessary, cash, which shares
and/or cash have an aggregate value equal to the excess of the
Current Value over the Purchase Price. If both Common Stock and
cash are to be delivered pursuant to the preceding sentence,
amounts of both Common Stock and cash shall be delivered upon
surrender of each Right in a ratio of Common Stock to cash that
bears the same ratio as the total value of all Common Stock to be
delivered (as determined pursuant to this Section 11(a)(iii)) bears
to the total value of all cash to be delivered; provided, however,
that the Company may adjust such ratio to avoid issuing any
fractional shares of Common Stock so long as the method of
adjustment is applied consistently to each holder of Rights
entitled to receive value thereon pursuant to this
Section 11(a)(iii). To the extent that the Company determines that
some action is to be taken pursuant to the first and/or third
sentences of this Section 11(a)(iii), the Company (x) shall
provide, subject to Section 7(e) hereof, that such action shall
apply uniformly to all outstanding Rights, and (y) may suspend the
exercisability of the Rights but in no event to a time later than
the expiration of the Substitution Period. In the event of any
such suspension, the Company shall issue a public announcement
stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the
suspension is no longer in effect. Upon any change in the
Adjustment Shares obtainable upon exercise of a Right pursuant to
this Section 11(a)(iii), the Purchase Price shall thereafter mean
the amount, if any, required to be paid upon exercise of a Right
for the Adjustment Shares, if any, and the Substitute
Consideration, if any, then issuable or deliverable upon exercise
of a Right, and a majority of the Continuing Directors (or if no
Continuing Directors are then in office, the Board of Directors of
the Company) shall make any necessary provisions to ensure that the
provisions of Section 11(e) shall thereafter apply as appropriate
to the Total Consideration. For purposes of this Section
11(a)(iii), (A) "Current Value" shall be the product derived by
multiplying (x) the number of Adjustment Shares issuable in respect
of each Right determined under Section 11(a)(ii), by (y) the
Current Market Price per share of Common Stock on the date of the
Triggering Event, and (B) the value of each share of Common Stock
and each share or unit of any "Common Stock Equivalent" shall be
deemed conclusively to be equal to the Current Market Price per
share of the Common Stock on the date of the Triggering Event.
(iv) A majority of the Continuing Directors (or if
no Continuing Directors are then in office, the Board of Directors
of the Company) may, at their option, at any time and from time to
time after the first occurrence of a Triggering Event, cause the
Company to exchange, for all or part of the then-outstanding and
exercisable Rights (which shall not include Rights that have become
void pursuant to the provisions of Section 7(e) hereof), shares of
Common Stock or Common Stock Equivalents at an exchange ratio of
one share of Common Stock per Right, appropriately adjusted to
reflect any stock split, stock dividend or similar transaction
occurring after the date of this Agreement (such exchange ratio
being hereinafter referred to as the "Exchange Ratio"). Any
partial exchange shall be effected on a pro rata basis based on the
number of Rights (other than Rights which have become void pursuant
to the provisions of Section 7(e) hereof) held by each holder of
Rights.
Immediately upon the action of a majority of the
Continuing Directors (or if no Continuing Directors are then in
office, the Board of Directors of the Company) ordering the
exchange of any Rights pursuant to this Section 11(a)(iv) and
without any further action and without any notice, the right to
exercise such Rights shall terminate and the only right thereafter
of a holder of such Rights shall be to receive that number of
shares of Common Stock and/or Common Stock Equivalents equal to the
number of such Rights held by such holder multiplied by the
Exchange Ratio. The Company shall promptly give public notice of
any such exchange and in addition, the Company shall promptly mail
a notice of any such exchange to all of the holders of such Rights
in accordance with Section 25 of this Agreement; provided, however,
that the failure to give, any delay in giving or any defect in,
such notice shall not affect the validity of such exchange. Each
such notice of exchange will state the method by which the exchange
of the Common Stock or Common Stock Equivalents for Rights will be
effected and, in the event of any partial exchange, the number of
Rights which will be exchanged. In the event that the number of
shares of Common Stock which is authorized but not outstanding or
reserved for issuance for a purpose other than exercise of the
Rights is not sufficient to permit any exchange of Rights as
contemplated in accordance with this Section 11(a)(iv), the Board
of Directors of the Company shall take all such action within its
power as may be necessary to authorize additional shares of Common
Stock for issuance upon exchange of the Rights. The Company shall
not be required to issue fractions of shares of Common Stock or
Common Stock Equivalents or to distribute certificates which
evidence fractional shares of Common Stock or Common Stock
Equivalents. In lieu of such fractional shares of Common Stock or
Common Stock Equivalents, the Company shall pay to the registered
holders of the Rights Certificates with regard to which such
fractional shares of Common Stock or Common Stock Equivalents would
otherwise be issuable an amount in cash equal to the product
derived by multiplying (x) the subject fraction, by (y) the last
sale price of the Company's Common Stock on the fifth Trading Day
following the public announcement of the exchange by the Company,
or, in case no such sale takes place on such day, the average of
the closing bid and asked prices on such day, in either case on a
when issued basis (taking into account the exchange), 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 Company's Common Stock is not so listed
or traded, then as determined in the manner provided under the
definition of "Current Market Price," adjusted to take into account
the exchange). For the purposes of this Section 11(a)(iv) the
value of any Common Stock Equivalent on any date shall be the same
as the value of the Common Stock, as determined pursuant to the
previous sentence, on such date.
(b) If the Company shall at any time on or after the
date of this Agreement fix a record date for the issuance of
rights, options or warrants to holders of Preferred Stock entitling
them to subscribe for or purchase Preferred Stock or Equivalent
Shares (or securities convertible into Preferred Stock or
Equivalent Shares) at a price per share of Preferred Stock or
Equivalent Shares (or, in the case of a convertible security,
having a conversion price per share of Preferred Stock or
Equivalent Shares) less than the Current Market Price per share of
Preferred Stock on such record date, the Purchase Price to be in
effect after such record date shall be determined by multiplying
the Purchase Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the number of shares
of Preferred Stock and Equivalent Shares (if any) outstanding on
such record date, plus the number of shares of Preferred Stock or
Equivalent Shares, as the case may be, which the aggregate exercise
and/or conversion price for the total number of shares of Preferred
Stock or Equivalent Shares, as the case may be, which are
obtainable upon exercise and/or conversion of such rights, options,
warrants or convertible securities would purchase at such Current
Market Price, and the denominator of which shall be the number of
shares of Preferred Stock and Equivalent Shares (if any)
outstanding on such record date, plus the number of additional
shares of Preferred Stock or Equivalent Shares, as the case may be,
which may be obtained upon exercise and/or conversion of such
rights, options, warrants or convertible securities. 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 a majority of
the Continuing Directors (or, if no Continuing Directors are then
in office, by the Board of Directors of the Company), whose
determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent. Preferred
Stock and Equivalent Shares owned by or held for the account of the
Company or any Subsidiary 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, options or warrants
are not issued following such adjustment, the Purchase Price shall
be readjusted to be the Purchase Price which would have been in
effect if such record date had not been fixed.
(c) In case the Company shall at any time after the date
of this Agreement fix a record date for the making of a
distribution to holders of Preferred Stock (including any such
distribution made in connection with a reclassification of the
Preferred Stock or a consolidation or merger in which the Company
is the surviving corporation) of securities (other than Preferred
Stock and rights, options or warrants referred to in Section
11(b)), cash (other than a regular periodic cash dividend out of
earnings or retained earnings), property, evidences of
indebtedness, or assets, the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the Current Market Price
per share of Preferred Stock on such record date, less the fair
market value (as determined in good faith by a majority of the
Continuing Directors (or if no Continuing Directors are then in
office, by the Board of Directors of the Company) whose determina-
tion shall be described in a statement filed with the Rights Agent)
of such securities, cash, property, evidences of indebtedness or
assets to be so distributed in respect of one share of Preferred
Stock, and the denominator of which shall be such Current Market
Price per share of Preferred Stock on such record date. Such
adjustments shall be made successively whenever such a record date
is fixed; and in the event that such distribution is not made
following such adjustment, the Purchase Price shall be readjusted
to be the Purchase Price which would have been in effect if such
record date had not been fixed.
(d) Except as provided below, no adjustment in the
Purchase Price shall be required unless such adjustment would
require an increase or decrease of at least 1% in the Purchase
Price; provided, however, that any adjustments which by reason of
this Section 11(d) 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, to the nearest ten-thousandth of a share of Common Stock, or
to the nearest ten-millionth of a share of Preferred Stock, as the
case may be. Notwithstanding the first sentence of this
Section 11(d), any adjustment required by this Section 11 shall be
made no later than the earlier of (i) three years from the date of
the transaction which requires such adjustment or (ii) the
Expiration Date.
(e) If, as a result of an adjustment made pursuant to
Section 11(a) or Section 13(a) of this Agreement, the holder of any
Right thereafter exercised shall become entitled to receive any
securities of the Company other than shares of Preferred Stock,
thereafter the Purchase Price and the number of such other
securities 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 shares of Preferred Stock contained in this Section 11 and the
provisions of Sections 7, 9, 10, 12, 13, 14 and 24 with respect to
the shares of Preferred Stock shall apply on like terms to any such
other securities.
(f) 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 shares of Preferred Stock or other securities,
cash or other property purchasable from time to time hereunder upon
exercise of the Rights, all subject to further adjustment as
provided in this Agreement.
(g) Unless the Company shall have exercised its election
as provided in Section 11(h), upon each adjustment of the Purchase
Price as a result of the calculations made in Sections 11(a)(i),
11(b) and 11(c), each Right outstanding immediately prior to the
making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of one one-
thousandths of a share of Preferred Stock (calculated to the
nearest one ten-millionth of a share of Preferred Stock) obtained
by (i) multiplying the number of one one-thousandths of a share of
Preferred Stock covered by a Right immediately prior to adjustment
pursuant to this Section 11(g) by 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.
(h) The Company may elect, on or after the date of any
adjustment of the Purchase Price or any adjustment to the number of
shares of Preferred Stock for which a Right may be exercised, to
adjust the number of Rights, in lieu of an adjustment in the number
of one one-thousandths of a share of Preferred Stock purchasable
upon the exercise of a Right. Each of the Rights outstanding after
such adjustment of the number of Rights shall be exercisable for
the number of one one-thousandths of a share of Preferred Stock for
which a Right was exercisable immediately prior to such adjustment.
Each Right outstanding prior to such adjustment of the number of
Rights shall become that number of Rights (calculated to the
nearest one hundred-thousandth) obtained by dividing the Purchase
Price in effect immediately prior to such adjustment by the
Purchase Price in effect immediately after such adjustment. The
Company shall make a public announcement of its election to adjust
the number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the adjustment
to be made. This record date may be the date on which the Purchase
Price is adjusted or any day thereafter, but, if the Rights
Certificates have been issued, shall be at least 10 days after the
date of the public announcement. If Rights Certificates have been
issued, upon each adjustment of the number of Rights pursuant to
this Section 11(h) the Company shall, as promptly as practicable,
cause to be distributed to holders of record of Rights Certificates
on such record date a new Rights Certificate 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 Rights Certificates held by
such holders prior to the date of adjustment and upon surrender
thereof (if required by the Company), new Rights Certificates
evidencing all the Rights to which such holders shall be entitled
after such adjustment. Rights Certificates to be so distributed
shall be issued, executed and countersigned in the manner provided
for in this Agreement (and may bear, at the option of the Company,
the adjusted Purchase Price) and shall be registered in the names
of the holders of record of Rights Certificates on the record date
specified in the public announcement.
(i) Irrespective of any adjustment or change in the
Purchase Price or the number or kind of shares issuable upon the
exercise of the Rights, the Rights Certificates theretofore and
thereafter issued may continue to express the Purchase Price per
one one-thousandth of a share of Preferred Stock and the number of
shares of Preferred Stock which were expressed in the initial
Rights Certificates issued hereunder.
(j) Before taking any action that would cause an
adjustment reducing the Purchase Price below the then par value, if
any, of one one-thousandth of a share of Preferred Stock issuable
upon exercise of the Rights, the Company shall take any corporate
action which may, in the opinion of its counsel, be necessary in
order that the Company may validly and legally issue fully paid and
nonassessable one one-thousandth shares of such Preferred Stock at
such adjusted Purchase Price.
(k) In any case in which this Section 11 shall require
that an adjustment be made effective as of a record date for a
specified event, the Company may elect to defer until the
occurrence of such event the issuance to the holder of any Right
exercised after such record date the shares of Preferred Stock and
other securities, cash or property of the Company, if any, issuable
upon such exercise over and above the shares of Preferred Stock and
other securities, cash or property of the Company, if any, issuable
upon such exercise on the basis of the Purchase Price in effect
prior to such adjustment; provided, however, that the Company shall
deliver to such holder a due bill or other appropriate instrument
evidencing such holder's right to receive such additional shares
(fractional or otherwise) or other securities, cash or property
upon the occurrence of the event requiring such adjustment.
(l) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such
reductions in the Purchase Price, in addition to those adjustments
expressly required by this Section 11, as and to the extent that it
in its sole discretion shall determine to be advisable in order
that any combination or subdivision of the Preferred Stock,
issuance wholly for cash of any Preferred Stock at less than the
Current Market Price, issuance wholly for cash of Preferred Stock
or securities which by their terms are convertible into or
exchangeable or exercisable for Preferred Stock, stock dividends or
issuance of rights, options or warrants referred to in this
Section 11, hereafter made by the Company to holders of its
Preferred Stock, shall not be taxable to such stockholders.
(m) The Company covenants and agrees that it shall not
(i) consolidate with, (ii) merge with or into, or (iii) directly or
indirectly sell, lease, or otherwise transfer or dispose of (in one
transaction or a series of related transactions) assets or earning
power aggregating more than 50% of the assets or earning power of
the Company and its Subsidiaries taken as a whole, to any other
Person if (A) at the time of or immediately after such
consolidation, merger, sale, lease, transfer or disposition there
are any rights, warrants, securities or other instruments
outstanding or agreements in effect which would substantially
diminish or otherwise eliminate the benefits intended to be
afforded by the Rights, (B) prior to, simultaneously with or
immediately after such consolidation, merger, sale, lease, transfer
or disposition the stockholders (or equity holders) of the Person
who constitutes, or would constitute, the Principal Party in such
transaction shall have received a distribution of Rights previously
owned by such Person or any of its Affiliates or Associates or
(C) the form or nature of organization of the Principal Party would
preclude or limit the exercisability of the Rights. The Company
shall not consummate any such consolidation, merger, sale, lease,
transfer or disposition unless prior thereto the Company and such
other Person shall have executed and delivered to the Rights Agent
a supplemental agreement evidencing compliance with this
Section 11(m).
(n) The Company covenants and agrees that, after the
Stock Acquisition Date it will not, except as permitted by
Section 11(a)(iv), 26 or 29(b) of this Agreement, take (or permit
any Subsidiary to take) any action if at the time such action is
taken it is reasonably foreseeable that such action will, directly
or indirectly, diminish or otherwise eliminate the benefits
intended to be afforded by the Rights.
(o) Anything in this Agreement to the contrary
notwithstanding, if the Company shall at any time prior to the
Distribution Date (i) pay a dividend or distribution on the
outstanding shares of Common Stock payable in shares of Common
Stock, (ii) subdivide the outstanding Common Stock, or
(iii) combine the outstanding Common Stock into a smaller number of
shares, then the number of Rights associated with each share of
Common Stock then outstanding, or issued or delivered thereafter
but prior to the Distribution Date, and the Purchase Price under,
and the number of one one-thousandths of a share of Preferred Stock
issuable in respect of, the Rights, shall be proportionately
adjusted, so that following such event one Right (with the Purchase
Price and the number of one one-thousandths of a share
proportionately adjusted thereunder) shall thereafter be associated
with each share of Common Stock then outstanding, or issued or
delivered thereafter but prior to the Distribution Date. For
example, if the Company effects a two-for-one stock split at a time
when each Right (if it becomes exercisable) would entitle the
holder to purchase one one-thousandth of a share of Preferred Stock
for a Purchase Price of $"Z", then following such stock split each
previous Right would be split into two current Rights and
thereafter each current Right, upon becoming exercisable, would
(subject to further adjustment) entitle the holder to purchase one
two-thousandth of a share of Preferred Stock at a Purchase Price of
1/2 x $"Z".
Section 12. Certification of Adjustments. Whenever an
adjustment is made as provided in Sections 11 and 13, the Company
shall (a) promptly prepare a certificate setting forth such
adjustment and a brief statement of the facts accounting for such
adjustment, (b) promptly file with the Rights Agent and with each
transfer agent for the Preferred Stock a copy of such certificate,
and (c) mail a brief summary thereof to each holder of a Rights
Certificate (or, if no Rights Certificates have been issued, to
each holder of a certificate representing shares of Common Stock)
in accordance with Section 25. Notwithstanding the foregoing
sentence, the failure of the Company to give such notice shall not
affect the validity of or the force or effect of or the requirement
for such adjustment. Any adjustment to be made pursuant to
Sections 11 and 13 of this Agreement shall be effective as of the
date of the event giving rise to such adjustment.
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power.
(a) A "Business Combination" shall be deemed to occur in
the event that, in or following a Triggering Event, (i) the Company
shall, directly or indirectly, consolidate with, or merge with and
into, any other Person (other than a Subsidiary of the Company in
a transaction that complies with Section 11(m) and Section 11(n) of
this Agreement) in a transaction in which the Company is not the
continuing, resulting or surviving corporation of such merger or
consolidation, (ii) any Person (other than a Subsidiary of the
Company in a transaction that complies with Section 11(m) and
Section 11(n) of this Agreement) shall, directly or indirectly,
consolidate with the Company, or shall merge with and into the
Company, in a transaction in which the Company is the continuing,
resulting or surviving corporation of such merger or consolidation
and, in connection with such merger or consolidation, all or part
of the Common Stock shall be changed (including, without
limitation, any conversion into or exchange for securities of the
Company or of any other Person, cash or any other property),
(iii) the Company shall, directly or indirectly, effect a share
exchange in which all or part of the Common Stock shall be changed
(including, without limitation, any conversion into or exchange for
securities of any other Person, cash or any other property) or
(iv) the Company shall, directly or indirectly, sell, lease,
exchange, mortgage, pledge or otherwise transfer or dispose of (or
one or more of its Subsidiaries shall directly or indirectly sell,
lease, exchange, mortgage, pledge or otherwise transfer or dispose
of), in one transaction or a series of related transactions, assets
or earning power aggregating more than 50% of the assets or earning
power of the Company and its Subsidiaries (taken as a whole) to any
other Person (other than the Company or any of its Subsidiaries in
one or more transactions each and all of which comply with
Section 11(m) and Section 11(n) of this Agreement).
In the event of a Business Combination, proper provision
shall be made so that each holder of a Right (except as otherwise
provided in this Agreement) shall thereafter have the right to
receive, upon the exercise thereof at the Purchase Price
immediately prior to the first occurrence of a Triggering Event
multiplied by the number of one one-thousandths of a share of
Preferred Stock for which a Right was exercisable immediately prior
to the first occurrence of a Triggering Event (without giving
effect to the Triggering Event) in accordance with the terms of
this Agreement, such number of shares of Common Stock of the
Principal Party as shall be equal to the result obtained by
(x) multiplying the Purchase Price immediately prior to the first
occurrence of a Triggering Event by the number of one one-
thousandths of a share of Preferred Stock for which a Right was
exercisable immediately prior to the first occurrence of a
Triggering Event (without giving effect to the Triggering Event),
and (y) dividing that product by 50% of the Current Market Price
per share of the Common Stock of such Principal Party immediately
prior to the consummation of such Business Combination. All shares
of Common Stock of any Person for which any Right may be exercised
after consummation of a Business Combination as provided in this
Section 13(a) shall, when issued upon exercise thereof in
accordance with this Agreement, be duly and validly authorized and
issued, fully paid, nonassessable, freely tradeable, not subject to
liens or encumbrances, and free of preemptive rights, rights of
first refusal or any other restrictions or limitations on the
transfer or ownership thereof of any kind or nature whatsoever.
(b) After consummation of any Business Combination,
(i) the Principal Party shall be liable for, and shall assume, by
virtue of such Business Combination and without the necessity of
any further act, all the obligations and duties of the Company
pursuant to this Agreement, (ii) the term "Company" as used in this
Agreement shall thereafter be deemed to refer to such Principal
Party, and (iii) such Principal Party shall take all steps
(including, but not limited to, the reservation of a sufficient
number of shares of its Common Stock in accordance with Section 9)
in connection with such Business Combination as necessary to ensure
that the provisions of this Agreement shall thereafter be
applicable, as nearly as reasonably may be, in relation to the
shares of its Common Stock thereafter deliverable upon the exercise
of the Rights.
(c) The Company shall not consummate any Business
Combination unless prior thereto (i) the Principal Party shall have
a sufficient number of authorized shares of its Common Stock which
have not been issued or reserved for issuance (other than shares
reserved for issuance pursuant to this Agreement to the holders of
Rights) to permit the exercise in full of the Rights in accordance
with this Section 13, (ii) the Company and such Principal Party
shall have executed and delivered to the Rights Agent a
supplemental agreement providing for the fulfillment of the
Principal Party's obligations and the terms as set forth in
paragraphs (a) and (b) of this Section 13 and further providing
that, as soon as practicable on or after the date of such Business
Combination, the Principal Party, at its own expense, shall
(A) prepare and file, if necessary, a registration statement on an
appropriate form under the Securities Act with respect to the
Rights and the securities purchasable upon exercise of the Rights,
(B) use its best efforts to cause such registration statement to
become effective as soon as practicable after such filing and
remain effective (with a prospectus at all times meeting the
requirements of the Securities Act) until the Expiration Date,
(C) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which
comply in all respects with the requirements for registration on
Form 10 (or any successor form) under the Exchange Act, (D) use its
best efforts to qualify or register the Rights and the securities
purchasable upon exercise of the Rights under the state securities
or "blue sky" laws of such jurisdictions as may be necessary or
appropriate, (E) use its best efforts to list the Rights and the
securities purchasable upon exercise of the Rights on a United
States national securities exchange, and (F) obtain waivers of any
rights of first refusal or preemptive rights in respect of the
Common Stock of the Principal Party subject to purchase upon
exercise of outstanding Rights, (iii) the Company and the Principal
Party shall have furnished to the Rights Agent an opinion of
independent counsel stating that such supplemental agreement is a
legal, valid and binding agreement of the Principal Party
enforceable against the Principal Party in accordance with its
terms, and (iv) the Company and the Principal Party shall have
filed with the Rights Agent a certificate of a nationally
recognized firm of independent accountants setting forth the number
of shares of Common Stock of such issuer which may be purchased
upon the exercise of each Right after the consummation of such
Business Combination.
(d) The provisions of this Section 13 shall similarly
apply to successive Business Combinations. In the event a Business
Combination shall be consummated at any time after the occurrence
of a Triggering Event, the Rights which have not theretofore been
exercised shall thereafter be exercisable for the consideration and
in the manner described in Section 13(a). Following a Business
Combination, the provisions of Section 11(a)(ii) of this Agreement
shall be of no effect.
(e) Notwithstanding any other provision of this
Agreement, no adjustment to the number of shares of Preferred Stock
(or fractions of a share) or other securities, cash or other
property for which a Right is exercisable or the number of Rights
outstanding or associated with each share of Common Stock or any
similar or other adjustment 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 and 13, unless the terms of this Agreement are amended
so as to preserve such benefits.
(f) The Company covenants and agrees that it shall not
effect any Business Combination if at the time of, or immediately
after such Business Combination, there are any rights, options,
warrants or other instruments outstanding which would diminish or
otherwise eliminate the benefits intended to be afforded by the
Rights.
(g) Without limiting the generality of this Section 13,
in the event the nature of the organization of any Principal Party
shall preclude or limit the acquisition of Common Stock of such
Principal Party upon exercise of the Rights as required by
Section 13(a) as a result of a Business Combination, it shall be a
condition to such Business Combination that such Principal Party
shall take such steps (including, but not limited to, a
reorganization) as may be necessary to ensure that the benefits
intended to be derived under this Section 13 upon the exercise of
the Rights are assured to the holders thereof.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue
fractional Rights or to distribute Rights Certificates which
evidence fractional Rights. In lieu of such fractional Rights, the
Company may at its option pay to the registered holders of the
Rights Certificates with respect 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 a Right for the Trading Day
immediately prior to the date on which such fractional Rights
otherwise would have been issuable. The closing price for any
Trading Day shall be the last sale price on such day, regular way,
or, in case no such sale takes place on such day, the average of
the closing bid and asked prices, regular way, on such day, in
either case as reported in the principal consolidated transaction
reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the Rights are not
listed or admitted to trading on the New York Stock Exchange, as
reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal United States
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 United States national securities exchange, the last
quoted sale price on such day or, if not so quoted, the average of
the high bid and low asked prices on such day in the over-the-
counter market, as reported by NASDAQ or such other system then in
use or, if on such day the Rights are not quoted by any such
system, the average of the closing bid and asked prices on such day
as furnished by a professional market maker making a market in the
Rights selected by a majority of the Continuing Directors (or if no
Continuing Directors are then in office, the Board of Directors of
the Company). If on such day no such market maker is making a
market in the Rights, the current market value of the Rights on
such day shall be determined in good faith by a majority of the
Continuing Directors (or if no Continuing Directors are then in
office, the Board of Directors of the Company), whose determination
shall be described in a statement filed with the Rights Agent and
shall be binding and conclusive for all purposes.
(b) The Company shall not be required to issue fractions
of shares of Preferred Stock (other than fractions which are
integral multiples of one one-thousandth of a share of Preferred
Stock) upon exercise of the Rights or to distribute certificates
which evidence fractional shares of Preferred Stock (other than
fractions which are integral multiples of one one-thousandth of a
share of Preferred Stock). Fractions of shares of Preferred Stock
may, at the election of the Company, be evidenced by depositary
receipts, pursuant to an appropriate agreement between the Company
and a depositary selected by it, provided that such agreement shall
provide that the holders of such depositary receipts shall have all
the rights, privileges and preferences to which they are entitled
as beneficial owners of the Preferred Stock. In lieu of fractional
shares of Preferred Stock that are not integral multiples of one
one-thousandth of a share of Preferred Stock, the Company may at
its option (i) issue scrip or warrants in registered form (either
represented by a certificate or uncertificated) or in bearer form
(represented by a certificate) which shall entitle the holder to
receive a full one one-thousandth of a share of Preferred Stock
upon the surrender of such scrip or warrants aggregating a full one
one-thousandth of a share of Preferred Stock, or (ii) pay to the
registered holders of Rights Certificates at the time such Rights
Certificates are exercised as provided in this Agreement an amount
in cash equal to the same fraction of the current market value of
a share of Preferred Stock. For purposes of this Section 14(b),
the current market value of a share of Preferred Stock shall be the
closing price of a share of Preferred Stock (as determined pursuant
to the second sentence of the definition of "Current Market Price"
in Section 1) for the Trading Day immediately prior to the date of
such exercise.
(c) The holder of a Right by his acceptance thereof
expressly waives any right to receive any fractional Rights or any
fractional shares upon exercise of a Right (except as otherwise
provided in this Agreement).
Section 15. Rights of Action. Except as otherwise provided,
all rights of action in respect of this Agreement are vested in the
respective registered holders of the Rights Certificates (and,
prior to the Distribution Date, any registered holders of
associated Common Stock); and any registered holder of any Rights
Certificate (or, prior to the Distribution Date, any share of
associated Common Stock), without the consent of the Rights Agent
or of the holder of any other Right, may, on 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 rights pursuant to 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 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 Concerning Transfer
and Ownership of Rights. Every holder of a Right by accepting the
same consents and agrees with the Company and the Rights Agent and
with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of Common Stock;
(b) after the Distribution Date, the Rights Certificates
will be transferable on the registry books of the Rights Agent only
if surrendered at the principal corporate trust 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 a Rights Certificate (or, prior to the
Distribution Date, the associated Common Stock certificate) is
registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or
writing on the Rights Certificate or the associated Common Stock
certificate made by anyone other than the Company, the transfer
agent for the Common Stock 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. Rights Holder Not Deemed a Stockholder. No
holder, as such, of any Rights Certificate shall be entitled to
vote or to receive dividends or distributions or shall be deemed
for any purpose the holder of Preferred Stock or any other
securities, cash or other property which may at any time be
issuable on the exercise of the Rights represented thereby, nor
shall anything contained in this Agreement or in any Rights
Certificate be construed to confer upon the holder of any Rights
Certificate, as such, any of the rights of a stockholder of the
Company, including, without limitation, any right (i) to vote for
the election of directors or upon any matter submitted to
stockholders at any meeting thereof, (ii) to give or withhold
consent to any corporate action, (iii) to receive notice of
meetings or other actions affecting stockholders (except as
provided in Section 24), (iv) to receive dividends, distributions
or subscription rights, (v) to institute, as a holder of Preferred
Stock or other securities issuable on exercise of the Rights
represented by any Rights Certificate, any derivative action on
behalf of the Company, or otherwise, until and only to the extent
that the Right or Rights evidenced by such Rights Certificate shall
have been exercised in accordance with the provisions of this
Agreement.
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, willful misconduct or breach of this
Agreement on the part of the Rights Agent, for anything done or
omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the costs and expenses
of defending against any claim of liability in the premises.
The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or
omitted by it in connection with its administration of this
Agreement in reliance upon any Rights Certificate or certificate
for Preferred Stock or Common Stock or for other securities of the
Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document reasonably
believed by it to be genuine and to be signed, executed and, when
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 document 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 Rights Certificates shall have
been countersigned but not delivered, any such successor Rights
Agent may adopt the countersignature of the predecessor Rights
Agent and deliver such Rights Certificate so countersigned; and in
case at that time any of the Rights Certificates shall not have
been countersigned, any successor Rights Agent may countersign such
Rights Certificate either in the name of the predecessor Rights
Agent or in the name of the successor Rights Agent; and in all such
cases such Rights Certificates shall have the full force provided
in the Rights Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall be
changed and at such time any of the Rights Certificates shall have
been countersigned but not delivered, the Rights Agent may adopt
the countersignature under its prior name and deliver Rights
Certificates so countersigned; and in case at that time any of the
Rights Certificates shall not have been countersigned, the Rights
Agent may countersign such Rights Certificates either in its prior
name or in its changed name; and in all such cases such Rights
Certificates shall have the full force provided in the Rights
Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, by all of which the
Company and the holders of Rights Certificates, by their acceptance
thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who
may be legal counsel for the Company), and the opinion of such
counsel shall be full and complete authorization and protection to
the Rights Agent as to any action taken or omitted by it in good
faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable
that any fact or matter (including, without limitation, the
identity of any Acquiring Person or any Affiliate or Associate of
an Acquiring Person or the determination of Current Market Price)
be proved or established by the Company prior to taking or
suffering any action hereunder, such fact or matter (unless other
evidence in respect thereof be specifically prescribed in this
Agreement) may be deemed to be conclusively proved and established
by a certificate signed by the Chairman of the Board and Chief
Executive Officer, the Vice Chairman of the Board, the President
and Chief Operating Officer, any Vice President, the Treasurer or
the 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
the negligence, bad faith, willful misconduct or breach of this
Agreement by it or its attorneys or agent. Anything in this
Agreement to the contrary notwithstanding, in no event shall the
Rights Agent be liable for special, indirect or consequential loss
or damage of any kind whatsoever (including but not limited to loss
profits) even if the Rights Agent has been advised of the
likelihood of such loss and damage and regardless of the form of
the action.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained in
this Agreement or in the Rights Certificates (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 of this Agreement (except the due execution
and delivery of this Agreement by the Rights Agent) or in respect
of the validity or execution of any Rights Certificate (except its
countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in
this Agreement or in any Rights Certificate; nor shall it be
responsible for any change or adjustment in the terms of the Rights
(including the manner, method or amount thereof) provided for in
Sections 3, 11, 13 or 23 or the ascertaining of the existence of
facts that would require any such change or adjustment (except with
respect to the exercise of Rights evidenced by Rights Certificates
after actual notice of any change or adjustment is required); nor
shall it by any act hereunder be deemed to make any representation
or warranty as to the authorization or reservation of any shares of
Preferred Stock, Common Stock or other securities to be issued
pursuant to this Agreement or any Rights Certificate or as to
whether any shares of Preferred Stock, Common Stock or other
securities 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 performance by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its
duties hereunder from the Chairman of the Board and Chief Executive
Officer, the Vice Chairman of the Board, the President and Chief
Operating Officer, any Vice President, the Secretary 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 the Rights Agent were
not serving as such under this Agreement. Nothing in this
Agreement shall preclude the Rights Agent from acting in any other
capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder
either itself or by or through its attorneys or agents.
(j) If, with respect to any Rights Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate attached to the form of assignment or form of election
to purchase, as the case may be, has either not been completed or
indicates an affirmative response to clause 1 and/or 2 thereof, the
Rights Agent shall not take any further action with respect to such
requested exercise or transfer without first consulting with the
Company.
Section 21. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties
under this Agreement upon 30 days' notice in writing mailed to the
Company and to each transfer agent of the Common Stock or Preferred
Stock by registered or certified mail, and to the holders of the
Rights Certificates by first-class mail. The Company may remove
the Rights Agent or any successor Rights Agent upon 30 days' notice
in writing, mailed to the Rights Agent or successor Rights Agent,
as the case may be, and to each transfer agent of the Common Stock
or Preferred Stock by registered or certified mail, and to the
holders of the Rights Certificates by first-class mail. If the
Rights Agent shall resign or be removed or shall otherwise become
incapable of acting, the Company shall appoint a successor to the
Rights Agent. Notwithstanding any other provision of this
Agreement, in no event shall the resignation or removal of a Rights
Agent be effective until a successor Rights Agent shall have been
appointed and have accepted such appointment. If the Company shall
fail to make such appointment within a period of 30 days after such
removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights
Agent or by any holder of a Rights Certificate (who shall, with
such notice, submit his Rights Certificate for inspection by the
Company), then the incumbent Rights Agent or the registered holder
of any Rights Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any
successor Rights Agent, whether appointed by the Company or by such
a court, shall be a corporation organized and doing business under
the laws of the United States or of the State of Ohio (or of any
other state of the United States so long as such corporation is
authorized to conduct a corporate trust or banking business in the
State of Ohio) in good standing, which is authorized under such
laws to exercise corporate trust powers and is subject to super-
vision 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 $50,000,000. After appointment, the
successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the
successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for such purpose. Not later than
the effective date of any such appointment, the Company shall file
notice thereof in writing with the predecessor Rights Agent and
each transfer agent of the Common Stock or Preferred Stock, and
mail a notice thereof in writing to the registered holders of the
Rights Certificates. Failure to give any notice provided for in
this Section 21, however, or any defect therein, shall not affect
the legality or validity of the resignation or removal of the
Rights Agent or the appointment of the successor Rights Agent, as
the case may be.
Section 22. Issuance of New Rights Certificates.
Notwithstanding any of the provisions of this Agreement or of the
Rights Certificates to the contrary, the Company may, at its
option, issue new Rights Certificates evidencing new Rights in such
form as may be approved by a majority of the Continuing Directors
(or if no Continuing Directors are then in office, by the Board of
Directors of the Company) to reflect any adjustment or change in
the Purchase Price per share and the number or kind or class of
securities, cash or other property purchasable under the Rights
Certificates made in accordance with the provisions of this
Agreement.
Section 23. Redemption and Termination.
(a) Subject to Section 23(b) below, the Board of
Directors of the Company may, at its option, at any time prior to
the earlier of (i) the Stock Acquisition Date and (ii) the
Expiration Date, redeem all but not less than all the then-
outstanding Rights at a redemption price of $.01 per Right
(appropriately adjusted to reflect any stock split, stock dividend
or similar transaction occurring after the date of this Agreement).
(b) At the time and date of effectiveness set forth in
any resolution of the Board of Directors of the Company ordering
the redemption of the Rights, without any further action and
without any further 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; provided, however, that
such resolution of the Board of Directors of the Company may be
revoked, rescinded or otherwise modified at any time prior to the
time and date of effectiveness set forth in such resolution, in
which event the right to exercise will not terminate at the time
and date originally set for such termination by the Board of
Directors of the Company, and provided further that, if the Board
of Directors of the Company authorizes redemption of the Rights in
either of the circumstances set forth in clauses (x) and (y) below,
then there must be Continuing Directors then in office and such
authorization shall require the concurrence of a majority of such
Continuing Directors: (x) such authorization occurs on or after
the date a Person becomes an Acquiring Person or (y) such
authorization occurs on or after the date of a change (resulting
from one or more proxy or consent solicitations) in a majority of
the directors in office at the commencement of the first such
solicitation if any Person who is a participant in any such
solicitation has stated (or, if upon the commencement of any such
solicitation, a majority of the Continuing Directors has determined
in good faith) that such Person (or any of its Affiliates or
Associates) intends to take, or may consider taking, any action
that would result in such Person (or any of its Affiliates or
Associates) becoming an Acquiring Person or that would cause the
occurrence of a Business Combination with or involving such Person
(or any of its Affiliates or Associates). As soon as practicable
after the action of the Board of Directors of the Company ordering
the redemption of the Rights, the Company shall give notice of such
redemption to the Rights Agent and to the holders of the then-
outstanding Rights by mailing such notice to all such holders at
their last addresses as they appear upon the registry books of the
Rights Agent or, prior to the issuance of Rights Certificates, on
the registry books of the transfer agent for the Common Stock. Any
notice which is mailed in the manner provided in this Agreement
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. In any
case, failure to give such notice by mail, or any defect in the
notice, to any particular holder of Rights shall not affect the
sufficiency of the notice to other holders of Rights. In the case
of a redemption permitted under this Section 23, the Company may,
at its option, discharge all of its obligations with respect to the
Rights by (i) issuing a press release announcing the manner of
redemption of the Rights and (ii) mailing payment of the redemption
price to the registered holders of the Rights at their last
addresses as they appear on the registry books of the Rights Agent
or, prior to the issuance of the Rights Certificates, on the
registry books of the transfer agent for the Common Stock, and upon
such action, all outstanding Rights Certificates shall be null and
void without any further action by the Company. Neither the
Company nor any of its Affiliates or Associates may redeem, acquire
or purchase for value any Rights at any time in any manner other
than that specifically set forth in this Section 23, and other than
in connection with the purchase of shares of Common Stock prior to
the earlier of the Distribution Date and the Expiration Date.
Section 24. Notice of Certain Events. In case the Company,
on or after the Distribution Date, shall propose to (a) pay any
dividend payable in stock of any class to the holders of its
Preferred Stock or to make any other distribution to the holders of
its Preferred Stock (other than a regular periodic cash dividend at
an annual rate not in excess of 125% of the annualized rate of the
cash dividend paid on the Preferred Stock during the immediately
preceding fiscal year), or (b) offer to the holders of its
Preferred Stock rights, options, or warrants to subscribe for or to
purchase any additional shares of Preferred Stock or shares of
stock of any class or any other securities, rights or options, or
(c) effect any reclassification of the Preferred Stock (other than
a reclassification involving only the subdivision of outstanding
shares of Preferred Stock, a change in the par value of such
Preferred Stock or a change from par value to no par value), or
(d) directly or indirectly effect any consolidation or merger into
or with, or effect any sale, lease, exchange, or other transfer or
disposition (or to permit one or more of its Subsidiaries to effect
any sale, lease, exchange or other transfer or disposition), in one
transaction or a series of related transactions, of more than 50%
of the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to, any other Person, or (e) 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 any record date for the purposes of such stock
dividend or distribution of rights, or the date on which such
reclassification, consolidation, merger, sale, lease, exchange,
transfer, disposition, liquidation, dissolution, or winding up is
to take place and if such holders will or may participate therein,
the date of participation therein by the holders of Common Stock
and/or Preferred Stock, if any such date is to be fixed, and such
notice shall be so given in the case of any action covered by
clause (a) or (b) above at least 20 days prior to the record date
for determining holders of the Preferred Stock for purposes of such
action, and in the case of any such other action, at least 20 days
prior to the date of the taking of such proposed action or the date
of participation therein, if any, by the holders of Preferred
Stock, whichever shall be the earlier. The failure to give notice
as required by this Section 24 or any defect therein shall not
affect the legality or validity of the action taken by the Company
or the vote upon any such action.
In case any Triggering Event or Business Combination
shall occur, then, in any such case, the Company shall as soon as
practicable thereafter give to each holder of a Rights Certificate,
in accordance with Section 25, notice of the occurrence of such
Triggering Event or Business Combination, which shall specify the
Triggering Event or Business Combination and include a description
of the consequences of such event to holders of Rights under
Section 11(a)(ii) or 13.
Section 25. Notices. Notices or demands authorized by this
Agreement to be given or made by the Rights Agent or by the holder
of any Rights Certificate to or on the Company shall be
sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with
the Rights Agent) as follows:
Health Care REIT, Inc.
One SeaGate, Suite 1950
Toledo, Ohio 43604
Attn: Vice President and General Counsel
Subject to the provisions of Section 21, any notice or demand
authorized by this Agreement to be given or made by the Company or
by the holder of any Rights Certificate to or on the Rights Agent
shall be sufficiently given or made if sent by first-class mail,
postage prepaid, addressed (until another address is filed in
writing with the Company) as follows:
Chemical Bank
450 W. 33rd Street, 15th Floor
New York, New York 10001
Attn: Equity Relationship Management Vice President
Notices or demands authorized by this Agreement to be given or made
by the Company or the Rights Agent to the holder of any Rights
Certificate 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 (or, if no Rights Certificates have been issued, if sent by
first-class mail, postage prepaid, addressed to each holder of a
certificate representing shares of Common Stock at the address of
such holder as shown on the Company's Common Stock registry books).
Section 26. Supplements and Amendments.
(a) Subject to Section 26(d) below, at any time prior to
the Stock Acquisition Date, the Board of Directors of the Company
may, except as provided in Section 26(c), and the Rights Agent
shall, if so directed, supplement or amend any provision of this
Agreement without the approval of any holders of Rights.
(b) Subject to Section 26(d) below, from and after the
Stock Acquisition Date, the Board of Directors of the Company may,
except as provided in Section 26(c), and the Rights Agent shall, if
so directed, amend this Agreement without the approval of any
holders of Rights Certificates (i) to cure any ambiguity, (ii) to
correct or supplement any provision contained in this Agreement
which may be defective or inconsistent with any other provision of
this Agreement, or (iii) to change or supplement the provisions
hereunder in any manner which the Company may deem necessary or
desirable and which shall not adversely affect the interests of the
holders of Rights Certificates (other than an Acquiring Person or
an Affiliate or Associate of an Acquiring Person).
(c) No supplement or amendment to this Agreement shall
be made which changes the Purchase Price, the number of shares of
Preferred Stock, other securities, cash or other property for which
a Right is then exercisable or the redemption price or provides for
an earlier Expiration Date.
(d) Immediately upon the action of the Board of
Directors of the Company providing for any amendment or supplement
pursuant to this Section 26, and without any further action and
without notice, such amendment or supplement shall be deemed
effective, provided that, if the Board of Directors authorizes an
amendment or supplement of this Agreement in either of the
circumstances set forth in clauses (x) and (y) of Section 23(b) of
this Agreement, then there must be Continuing Directors then in
office and such authorization shall require the concurrence of a
majority of such Continuing Directors. Promptly following the
adoption of any amendment or supplement pursuant to this
Section 26, the Company shall deliver to the Rights Agent a copy,
certified by the Secretary or any Assistant Secretary of the
Company, of resolutions of the Board of Directors of the Company
adopting such amendment or supplement. Upon such delivery, the
amendment or supplement shall be administered by the Rights Agent
as part of this Agreement in accordance with the terms of this
Agreement, as so amended or supplemented.
Section 27. Successors. All the covenants and provisions of
this Agreement by or for the benefit of the Company or the Rights
Agent shall bind and inure to the benefit of their respective
successors and assigns hereunder.
Section 28. Benefits of this Agreement; Determinations and
Actions by the Board of Directors. Nothing in this Agreement shall
be construed to give to any Person other than the Company, the
Rights Agent and the registered holders of Rights any legal or
equitable right, remedy or claim under this Agreement; and this
Agreement shall be for the sole and exclusive benefit of the
Company, the Rights Agent and the registered holders of the Rights.
For purposes of this Agreement, any calculation of the
number of shares of Common Stock outstanding at any particular time
shall be made in accordance with the last sentence of Rule 13d-
3(d)(1)(i) of the General Rules and Regulations under the Exchange
Act (or any successor provision); provided, however, that any such
calculation made for purposes of determining the particular
percentage of outstanding shares of Common Stock of which any
Person is the Beneficial Owner shall also include any such other
securities not then actually issued and outstanding which such
Person would be deemed to be the Beneficial Owner of, or to
"beneficially own," pursuant to Section 1(d) of this Agreement.
The Board of Directors of the Company (or, where specifically
provided for herein, a majority of the Continuing Directors) shall
have the exclusive power and authority to administer this Agreement
and to exercise all rights and powers specifically granted to the
Continuing Directors, the Board of Directors of the Company or the
Company, or as may be necessary or advisable in the administration
of this Agreement, including, without limitation, the right and
power to (i) interpret the provisions of this Agreement, and
(ii) make all determinations deemed necessary or advisable for the
administration of this Agreement (including a determination to
redeem or not redeem the Rights, to exchange or not exchange the
Rights for Common Stock or other securities of the Company, or to
amend or supplement this Agreement). All such actions,
calculations, interpretations and determinations (including, for
purposes of clause (y) below, all omissions with respect to the
foregoing) which are done or made by the Board of Directors of the
Company (or, where specifically provided for herein, a majority of
the Continuing Directors) in good faith, shall (x) be final,
conclusive and binding on the Company, the Rights Agent, the
holders of the Rights and all other Persons, and (y) not subject
the Board of Directors of the Company or the Continuing Directors
to any liability to the holders of the Rights.
Section 29. Severability.
(a) If any term, provision, covenant or restriction of
this Agreement or the application thereof to any Person or to any
circumstance 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.
(b) If legal counsel to the Company delivers to the
Company a written opinion to the effect that, as a result of
changes in federal law or Delaware law, any term, provision,
covenant or restriction of this Agreement may be invalid, void, or
unenforceable, then, notwithstanding any other provision of this
Agreement, the Company and the Rights Agent may amend this
Agreement to modify, revise or delete such term, provision,
covenant or restriction to the extent necessary to comply with such
law as so changed.
Section 30. Governing Law. This Agreement and each Rights
Certificate issued hereunder shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall
be governed by and construed in accordance with the internal laws
of such state applicable to contracts to be made and performed
entirely within such State, except that Sections 18, 19, 20 and 21
concerning the rights and duties of the Rights Agent, shall be
governed by the laws of the State of New York.
Section 31. Counterparts. This Agreement may be executed in
counterparts and each of such counterparts shall for all purposes
be deemed to be an original, and both such counterparts shall
together constitute but one and the same instrument.
Section 32. 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 of this Agreement.
Section 33. Grammatical Construction. Throughout this
Agreement, where such meanings would be appropriate, (a) any
pronouns used herein shall include the corresponding masculine,
feminine or neuter forms (e.g., references to "he" shall also
include "she" and "it" and references to "who" and "whom" shall
also include "which"), and (b) the plural form of nouns and
pronouns shall include the singular and vice-versa (e.g.,
references to "Continuing Directors" shall also mean "Continuing
Director" if there be only one Continuing Director at the relevant
time).
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.
HEALTH CARE REIT, INC.
By /s/ BRUCE G. THOMPSON
Name: Bruce G. Thompson
ATTEST:
Title: Chairman of the Board & CEO
By /s/ ERIN C. IBELE
Name: Erin C. Ibele
Title: Vice President
CHEMICAL BANK
By /s/ LESLIE A DELUCA
Name: Leslie A. DeLuca
ATTEST:
Title: Assistant Vice President
By /s/ AMY E. EATON
Name: Amy E. Eaton
Title: Assistant Vice President
<PAGE>
FORM OF
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
OF JUNIOR PARTICIPATING PREFERRED STOCK, SERIES A
OF
HEALTH CARE REIT, INC.
Pursuant to Section 151 of the Corporation Law
of the State of Delaware
We, Bruce G. Thompson, Chairman of the Board of Directors
and Chief Executive Officer, and Erin C. Ibele, Vice President and
Corporate Secretary, of Health Care REIT, Inc., a corporation
organized and existing under the General Corporation Law of the
State of Delaware, in accordance with the provisions of Section 151
thereof, DO HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board
of Directors by the Second Restated Certificate of Incorporation of
the said Corporation, the said Board of Directors on July 19, 1994,
adopted the following resolution creating a series of thirteen
thousand (13,000) shares of Preferred Stock designated as Junior
Participating Preferred Stock, Series A:
RESOLVED, that pursuant to the authority vested in the
Board of Directors of this Corporation in accordance with the
provisions of its Second Restated Certificate of Incorporation a
series of Preferred Stock of the Corporation be, and it hereby is,
created, and that the designation and amount thereof and the voting
powers, preferences and relative, participating, optional and other
special rights of the shares of such series, and the
qualifications, limitations or restrictions thereof are as follows:
Section 1. Designation and Amount. The shares of such
series shall be designated as "Junior Participating Preferred
Stock, Series A" (the "Series A Preferred Stock") and the number of
shares constituting such series shall be thirteen thousand
(13,000).
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the
holders of any shares of any series of Preferred Stock ranking
prior and superior to the shares of Series A Preferred Stock with
respect to dividends, the holders of shares of Series A Preferred
Stock, in preference to the holders of Common Stock, par value
$1.00 per share, of the Corporation (the "Common Stock") and of any
other junior stock, shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available
for the purpose, quarterly dividends payable in cash on the
fifteenth day of March, June, September and December in each year
(each such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend Payment
Date after the first issuance of a share or fraction of a share of
Series A Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to the greater of (a) $25.00 or (b) subject to
the provision for adjustment hereinafter set forth, 1,000 times the
aggregate per share amount of all cash dividends, and 1,000 times
the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions other than a dividend payable in
shares of Common Stock or a subdivision of the outstanding shares
of Common Stock (by reclassification or otherwise), declared on the
Common Stock since the immediately preceding Quarterly Dividend
Payment Date or, with respect to the first Quarterly Dividend
Payment Date, since the first issuance of any share or fraction of
a share of Series A Preferred Stock. In the event the Corporation
shall at any time on or after August 5, 1994, declare or pay any
dividend on Common Stock payable in shares of Common Stock, or
effect a subdivision of combination or consolidation of the
outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock)
into a greater or lesser number of shares of Common Stock, then in
each such case the amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event under
clause (b) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of which is the
number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or
distribution on the Series A Preferred Stock as provided in
paragraph (A) of this Section immediately after it declares a
dividend or distribution on the Common Stock (other than a dividend
payable in shares of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on the Common
Stock during the period between any Quarterly Dividend Payment Date
and the next subsequent Quarterly Dividend Payment Date, a dividend
of $25.00 per share on the Series A Preferred Stock shall neverthe-
less be payable on such subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be
cumulative on outstanding shares of Series A Preferred Stock from
the Quarterly Dividend Payment Date next preceding the date of
issue of such shares of Series A Preferred Stock, unless the date
of issue of such shares is prior to the record date for the first
Quarterly Dividend Payment Date, in which case dividends on such
shares shall begin to accrue from the date of issue of such shares,
or unless the date of issue is a Quarterly Dividend Payment Date or
is a date after the record date for the determination of holders of
shares of Series A Preferred Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment Date, in either
of which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued but
unpaid dividends shall not bear interest. Dividends paid on the
shares of Series A Preferred Stock in an amount less than the total
amount of such dividends at the time accrued and payable on such
shares shall be allocated pro rata on a share-by-share basis among
all such shares at the time outstanding. The Board of Directors
may fix a record date for the determination of holders of shares of
Series A Preferred Stock entitled to receive payment of a dividend
or distribution declared thereon, which record date shall be not
more than 60 days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of
Series A Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment
hereinafter set forth, each share of Series A preferred Stock shall
entitle the holder thereof to 1,000 votes on all matters submitted
to a vote of the stockholders of the Corporation. In the event the
Corporation shall at any time on or after August 5, 1994, declare
or pay any dividend on Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock)
into a greater or lesser number of shares of Common Stock, then in
each such case the number of votes per share to which holders of
shares of Series A Preferred Stock were entitled immediately prior
to such event shall be adjusted by multiplying such number by a
fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator
of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) Except as otherwise provided herein or by law,
the holders of shares of Series A Preferred Stock and the holders
of shares of Common Stock shall vote together as one class on all
matters submitted to a vote of stockholders of the Corporation.
(C) Except as set forth herein, holders of Series
A Preferred Stock shall have no special voting rights and their
consent shall not be required (except to the extent they are
entitled to vote with holders of Common Stock as set forth herein)
for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends
or distributions payable on the Series A Preferred Stock as
provided in Section 2 are in arrears, thereafter and until all
accrued and unpaid dividends and distributions, whether or not
declared, on shares of Series A Preferred Stock outstanding shall
have been paid in full, the Corporation shall not:
(i) declare or pay dividends on, or make any
other distributions on, any shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding up) to
the Series A Preferred Stock;
(ii) declare or pay dividends on or make any
other distributions on any shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or winding
up) with the Series A Preferred Stock, except dividends paid
ratably on the Series A Preferred Stock and all such parity stock
on which dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares are then
entitled;
(iii) redeem or purchase or otherwise acquire
for consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such
junior stock in exchange for shares of any stock of the Corporation
ranking junior (either as to dividends or upon dissolution,
liquidation or winding up) to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock, or any shares
of stock ranking on a parity with the Series A Preferred Stock,
except in accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend rates and
other relative rights and preferences of the respective series and
classes, shall determine in good faith will result in fair and
equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary
of the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the Corporation unless the
Corporation could, under paragraph (A) of this Section 4, purchase
or otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A
Preferred Stock purchased or otherwise acquired by the Corporation
in any manner whatsoever shall be retired and cancelled promptly
after the acquisition thereof. All such shares shall upon their
cancellation become authorized but unissued shares of preferred
stock and may be reissued as part of a new series of preferred
stock to be created by resolution or resolutions of the Board of
Directors, subject to the conditions and restrictions on issuance
set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. Upon
any liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (1) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock unless,
prior thereto, the holders of shares of Series A Preferred Stock
shall have received $100 per share, plus an amount equal to accrued
and unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment, provided that the holders of
shares of Series A Preferred Stock shall be entitled to receive an
aggregate amount per share, subject to the provision for adjustment
hereinafter set forth, equal to 1,000 times the aggregate amount to
be distributed per share to holders of Common Stock, or (2) to the
holders of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except distributions made ratably on the Series A
Preferred Stock and all other such parity stock in proportion to
the total amounts to which the holders of all such shares are
entitled upon such liquidation, dissolution or winding up. In the
event the Corporation shall at any time on or after August 5, 1994,
declare or pay any dividend on Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the aggregate amount to
which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under the proviso in clause (1) of
the preceding sentence shall be adjusted by multiplying such amount
by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger, combination
or other transaction in which the shares of Common Stock are
exchanged for or changed into other stock or securities, cash
and/or any other property, then in any such case the shares of
Series A Preferred Stock then outstanding shall at the same time be
similarly exchanged or changed in an amount per share (subject to
the provision for adjustment hereinafter set forth) equal to 1,000
times the aggregate amount of stock, securities, cash and/or any
other property (payable in kind), as the case may be, into which or
for which each share of Common Stock is changed or exchanged. In
the event the Corporation shall at any time on or after August 5,
1994, declare or pay any dividend on Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or consoli-
dation of the outstanding shares of Common Stock (by reclassifi-
cation or otherwise) into a greater or lesser number of shares of
Common Stock, then in each such case the amount set forth in the
preceding sentence with respect to the exchange or change of shares
of Series A Preferred Stock shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of shares
of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series A
Preferred Stock shall not be redeemable.
Section 9. Amendment. The Second Restated Certificate
of Incorporation of the Corporation shall not be amended in any
manner which would materially alter or change the powers,
preferences or special rights of the Series A Preferred Stock so as
to affect them adversely without the affirmative vote of the
holders of two-thirds of the outstanding shares of Series A
Preferred Stock, voting together as a single class.
IN WITNESS WHEREOF, we have executed and subscribed this
Certificate and do affirm the foregoing as true under the penalties
of perjury this ____ day of July, 1994.
__________________________________
Bruce G. Thompson, Chairman of the
Board and Chief Executive Officer
ATTEST:
_____________________________
Erin C. Ibele, Vice President
and Corporate Secretary
<PAGE>
[Form of Rights Certificate]
Certificate No. R- __________Rights
NOT EXERCISABLE AFTER JULY 19, 2004
OR EARLIER IF NOTICE OF REDEMPTION OR EXCHANGE
IS GIVEN. THE RIGHTS ARE SUBJECT TO REDEMPTION OR
EXCHANGE, AT THE OPTION OF THE COMPANY, ON THE
TERMS SET FORTH IN THE RIGHTS AGREEMENT.
[IF THE RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE
ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS
OR BECAME AN ACQUIRING PERSON OR AN ASSOCIATE
OR AFFILIATE OF AN ACQUIRING PERSON (AS SUCH TERMS
ARE DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY,
THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED
HEREBY MAY BECOME NULL AND VOID IN THE
CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE
RIGHTS AGREEMENT.]
Rights Certificate
HEALTH CARE REIT, INC.
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 19, 1994 (the "Rights Agreement") between Health
Care REIT, Inc., a Delaware corporation (the "Company"), and
Chemical Bank, a New York banking corporation (the "Agent"), unless
notice of redemption shall have been previously given by the
Company, 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. (Toledo, Ohio time) on July 19, 2004, at the
principal corporate trust office of the Rights Agent, or at the
office of its successor as Rights Agent, one one-thousandth of a
fully paid nonassessable share of the Junior Participating
Preferred Stock, Series A, par value $1.00 per share, of the
Company (the "Preferred Stock"), at a purchase price (the "Purchase
Price") of $48.00 per one one-thousandth share, upon presentation
and surrender of this Rights Certificate with the Form of Election
to Purchase duly executed. The Purchase Price may be paid in cash
or by certified bank check or bank draft payable to the order of
the Company.
As provided in the Rights Agreement, the Purchase Price
and the number of shares of Preferred Stock or other securities,
cash or other property which may be purchased upon the exercise of
the Rights evidenced by this Rights Certificate are subject to
modification and adjustment upon the happening of certain events.
If the Rights evidenced by this Rights Certificate are or
were formerly beneficially owned, on or after the earlier of the
Distribution Date and the Stock Acquisition Date, by (i) an
Acquiring Person or any Associate or Affiliate of an Acquiring
Person, or (ii) a direct or indirect transferee of an Acquiring
Person (or of any Associate or Affiliate of an Acquiring Person),
such Rights may become null and void, in which event the holder of
any such Right (including any subsequent holder) shall not have any
right with respect to such Right.
This Rights Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder
of the Rights Agent, the Company and the holders of the Rights
Certificates. Capitalized terms used but not defined in this
Rights Certificate that are defined in the Rights Agreement shall
have the same meanings ascribed to them in the Rights Agreement.
Copies of the Rights Agreement are on file at the principal
executive offices of the Company and the above-mentioned office of
the Rights Agent.
This Rights Certificate, with or without other Rights
Certificates, upon surrender at the principal corporate trust
office of the Rights Agent, may be exchanged for another Rights
Certificate or Rights Certificates of like tenor and date
evidencing Rights entitling the holder to purchase a like aggregate
number of shares of Preferred Stock or other property as the Rights
evidenced by the Rights Certificate or Rights Certificates
surrendered entitled such holder to purchase. If this Rights
Certificate shall be exercised in part, the holder shall be
entitled to receive upon surrender hereof another Rights
Certificate or Rights Certificates for the number of whole Rights
not exercised.
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate (a) may be redeemed by the
Board of Directors of the Company at its option at a redemption
price of $.01 per Right subject to adjustment, at any time prior to
the earlier of (i) 12:00 midnight (Toledo, Ohio time) on the Stock
Acquisition Date, and (ii) the Expiration Date or, (b) may be
exchanged by the Board of Directors of the Company at its option in
whole or in part for shares of the Company's Common Stock or other
Company securities.
No fractional shares of Preferred Stock (other than
fractions that are integral multiples of one one-thousandth of a
share of Preferred Stock, which may, at the election of the
Company, be evidenced by depository receipts) are required to be
issued upon the exercise of any Right or Rights evidenced hereby,
but in lieu thereof the Company may elect to (i) evidence
fractional shares by depositary receipts, (ii) issue scrip or
warrants in registered form (either represented by a certificate or
uncertificated) or in bearer form (represented by a certificate)
which shall entitle the holder to receive a full share upon the
surrender of such scrip or warrants aggregating a full share, or
(iii) make a cash payment, as provided in the Rights Agreement.
No holder of this Rights Certificate, as such, shall
beentitled to vote or to receive dividends on, or shall be deemed
for any purpose the holder of, Preferred Stock or of any other
securities, cash or property which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights
Agreement or this Certificate be construed to confer upon the
holder hereof, as such, any of the rights of a stockholder of the
Company, including, without limitation, any right to vote for the
election of directors or upon any matter submitted to stockholders
at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions
affecting stockholders (except as provided in the Rights
Agreement), or to receive dividends or subscription rights, or to
institute, as a holder of Preferred Stock or other securities
issuable on the exercise of the Rights represented by this
Certificate, any derivative action, or otherwise, until and only to
the extent the Right or Rights evidenced by this Rights Certificate
shall have been exercised as provided in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory
for any purpose until it shall have been countersigned by the
Rights Agent.
* * * * *
WITNESS the facsimile signature of the proper officers of
the Company and its corporate seal. Dated as of ___________.
HEALTH CARE REIT, INC.
By: _____________________________
Title:_____________________________
ATTEST:
By___________________________
Title:_______________________
CHEMICAL BANK
By:________________________________
Title:_____________________________
ATTEST:
By:___________________________
Title:________________________
[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Rights Certificate.)
FOR VALUE RECEIVED the undersigned ____________________
________________ hereby sells, assigns and transfers unto _______
_________________________________________________________________
(Please print name and address of transferee)
________________________________________________ Rights evidenced
by this Rights Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and
appoint _________________ Attorney to transfer the said Rights and
a Rights Certificate evidencing such Rights on the books of the
within-named Company, with full power of substitution.
A new Rights Certificate evidencing the remaining
balance, if any, of such Rights not hereby sold, assigned and
transferred shall be mailed to and registered in the name of the
undersigned unless such person requests that such Rights
Certificate be registered in the name of and mailed to (complete
only if a Rights Certificate evidencing any remaining balance of
Rights is to be registered in a name other than the undersigned):
Please insert social security
or other identifying number: ________________________
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
The undersigned hereby certifies by checking the
appropriate boxes that:
(1) this Rights Certificate or any Rights evidenced
hereby are not being sold, assigned and transferred by or on behalf
of a Person who is or was an Acquiring Person or an Affiliate or
Associate of an Acquiring Person (as such terms are defined in the
Rights Agreement); and
(2) after due inquiry and to the best knowledge of the
undersigned, the undersigned did not acquire any of the Rights
evidenced by this Rights Certificate from any Person who is or was
an Acquiring Person or an Affiliate or Associate of an Acquiring
Person.
Dated: _______________, ____
_________________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or
trust company having an office or correspondent in the United
States.
NOTICE
The signature to the foregoing Form of Assignment must
correspond to the name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement
or any change whatsoever.
In the event the certification set forth above in the
Form of Assignment is not completed, the Company will deem the
beneficial owner of the Rights evidenced by this Right Certificate
to be an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement) and, in the case of an assignment
or other transfer of this Rights Certificate or any Rights
evidenced hereby, will affix a legend to that effect on any Rights
Certificate issued in whole or partial exchange for this Rights
Certificate.
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise
the Rights represented by this Rights Certificate)
To: Health Care REIT, Inc.
The undersigned hereby irrevocably elects to exercise
____________________ Rights represented by this Rights Certifi-cate
to purchase the shares of Preferred Stock or other securities, cash
or other property issuable upon the exercise of such Rights and
requests that certificates for such shares or other securities be
issued in the name of, and such cash or other property be paid to:
Please insert social security
or other identifying number: ________________________
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
A new Rights Certificate evidencing the remaining
balance, if any, of such Rights not hereby exercised shall be
mailed to and registered in the name of the undersigned unless such
person requests that such Rights Certificate be registered in the
name of and mailed to (complete only if Rights Certificate
evidencing any remaining balance of Rights is to be registered in
a name other than the undersigned):
Please insert social security
or other identifying number: ________________________
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
The undersigned hereby certifies by checking the
appropriate boxes that:
(1) the Rights evidenced by this Rights Certificate are
not being exercised by or on behalf of a Person who is or was an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person (as such terms are defined in the Rights Agreement); and
(2) after due inquiry and to the best knowledge of the
undersigned, the undersigned did not acquire the Rights evidenced
by this Rights Certificate from any Person who is or was an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person.
Dated: _______________, ____
___________________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or
trust company having an office or correspondent in the United
States.
NOTICE
The signature on the foregoing Form of Election to
Purchase must correspond to the name as written upon the face of
this Rights Certificate in every particular, without alteration or
enlargement or any change whatsoever.
In the event the certification set forth above in the
Form of Election to Purchase is not completed, the Company will
deem the beneficial owner of the Rights evidenced by this Rights
Certificate to be an Acquiring Person or an Affiliate or Associate
thereof (as defined in the Rights Agreement) and, in the case of an
assignment or other transfer of this Rights Certificate or any
Rights evidenced hereby, will affix a legend to that effect on any
Rights Certificate issued in whole or partial exchange for this
Rights Certificate.
<PAGE>
FORM OF
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES
On July 19, 1994, the Board of Directors of Health Care
REIT, Inc. (the "Company") authorized the issuance of one preferred
share purchase right (a "Right") for each outstanding share of
common stock, par value $1.00 per share (the "Common Shares"), of
the Company. The distribution is payable on July 29, 1994 to the
stockholders of record at the close of business on August 5, 1994
(the "Record Date"), and with respect to all Common Shares that
become outstanding after the Record Date and prior to the earliest
of the Distribution Date (as defined below), the redemption of the
Rights, the exchange of the Rights, and the expiration of the
Rights (and, in certain cases, following the Distribution Date).
Each Right entitles the registered holder to purchase from the
Company one one-thousandth of a share of a Junior Participating
Preferred Stock, Series A, par value $1.00 per share, of the
Company (the "Preferred Shares") at a price of $48 per one one-
thousandth of a Preferred Share (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights are set forth
in a Rights Agreement (the "Rights Agreement") between the Company
and Chemical Bank, as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) the expiration of the
Company's redemption rights following the date of public disclosure
that a person or group other than certain exempt persons (an
"Acquiring Person"), together with persons affiliated or associated
with such Acquiring Person (other than those that are exempt
persons), has acquired, or obtained the right to acquire,
beneficial ownership of 15% or more of the outstanding Common
Shares (the "Stock Acquisition Date") or (ii) the tenth day after
the date of commencement or public disclosure of an intention to
commence a tender offer or exchange offer by a person other than an
exempt person if, upon consummation of the offer, such person could
acquire beneficial ownership of 15% or more of the outstanding
Common Shares (the earlier of such dates being called the
"Distribution Date"), the Rights will be evidenced by Common Share
certificates and not by separate certificates. The Rights
Agreement provides that, until the Distribution Date (or earlier
redemption, exchange or expiration of the Rights), the Rights will
be transferred with and only with the Common Shares. Until the
Distribution Date (or earlier redemption, exchange or expiration of
the Rights), new Common Share certificates issued after August 5,
1994, upon transfer or new issuance of the Common Shares, will
contain a notation incorporating the Rights Agreement by reference.
Until the Distribution Date (or earlier redemption, exchange or
expiration of the Rights) the surrender for transfer of any
certificate for Common Shares, with or without such notation or a
copy of this Summary of Rights being attached thereto, will also
constitute the transfer of the Rights associated with the 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 as of the close of business on the
Distribution Date, and such separate Right Certificates alone will
evidence the Rights.
The Rights will first become exercisable after the
Distribution Date (unless sooner redeemed or exchanged). The
Rights will expire at the close of business on August 5, 2004 (the
"Expiration Date"), unless earlier redeemed or exchanged by the
Company as described below.
The Purchase Price payable, and the number of Preferred
Shares or other securities, cash or other 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 or
distribution on, or a subdivision, combination or reclassification
of, the Preferred Shares, (ii) upon the grant to holders of the
Preferred Shares of certain rights, options or warrants to
subscribe for Preferred Shares or securities convertible into
Preferred Shares at less than the current market price of the
Preferred Shares or (iii) upon the distribution to holders of the
Preferred Shares of evidences of indebtedness or assets (excluding
regular periodic cash dividends out of earnings or retained
earnings) or of subscription rights or warrants (other than those
referred to above). In addition, the Purchase Price payable and
the number of Preferred Shares purchasable, on exercise of a Right
is subject to adjustment in the event that the Company should (i)
declare or pay any dividend on the Common Shares payable in Common
Shares or (ii) effect a subdivision or combination of the Common
Shares into a different number of Common Shares.
In the event that, at any time following public
disclosure that an Acquiring Person has become such, the Company is
involved in a merger or other business combination transaction
where the Company is not the surviving corporation or where Common
Stock is changed or exchanged or in a transaction or transactions
wherein 50% or more of its consolidated assets or earning power are
sold, proper provision would be made so that each holder of a Right
(other than such Acquiring Person and certain related persons or
transferees) 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 of the acquiring company or
the Company, as the case may be, 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 there is public disclosure
that an Acquiring Person has become such, proper provision would be
made so that each holder of a Right, other than Rights that are or
were beneficially owned by the Acquiring Person and certain related
persons and transferees (which will thereafter be void), on or
after the earlier of the Distribution Date and the first public
disclosure that an Acquiring Person has become such, will
thereafter have the right to receive upon exercise that number of
Common Shares having at the time of such transaction a market value
of two times the exercise price of the Right. In addition, the
Company's Board of Directors has the option of exchanging all or
part of the Rights (excluding void Rights) for an equal number of
Common Shares in the manner described in the Rights Agreement.
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
Preferred Shares will be issued (other than fractions which are
integral multiples of one one-thousandth of a Preferred Share,
which may, at the election of the Company, be evidenced by
depositary receipts) and in lieu thereof, an adjustment in cash
will be made based on the market price of the Preferred Shares on
the last trading date prior to the date of exercise.
At any time on or before public disclosure that an
Acquiring Person has become such, the Board of Directors of the
Company may redeem the Rights in whole, but not in part, at a price
of $.01 per Right (the "Redemption Price"), provided that, if any
person has become an Acquiring Person or there has been a change
(resulting from one or more proxy or consent solicitations) in a
majority of the directors in office at the commencement of the
first such solicitation if any person who is a participant in any
such solicitation has stated (or, if upon the commencement of any
such solicitation, a majority of the continuing directors has
determined in good faith) that such person (or any of its
affiliates or associates) intends to take, or may consider taking,
any action that would result in such person (or any of its
affiliates or associates) becoming an Acquiring Person or that
would cause the occurrence of a business combination with or
involving such person (or any of its affiliates or associates),
then any redemption of the Rights must be concurred in by a
majority of continuing directors. Immediately upon action of the
Board of Directors ordering redemption of the Rights, the ability
of holders to exercise the Rights will terminate and the only
rights of such holders will be to receive the Redemption Price.
At any time on or before a public disclosure that an
Acquiring Person has become such, the Board of Directors of the
Company may amend or supplement the Rights Agreement without the
approval of the Rights Agent or any holder of the Rights, except
for an amendment or supplement which would change the Redemption
Price, the final expiration date of the Rights or the Purchase
Price. Thereafter, the Board of Directors of the Company may amend
or supplement the Rights Agreement without such approval only to
increase the benefits to holders of the Rights or to create new
interests in such holders. However, under the circumstances
referred to in the preceding paragraph, any such amendment or
supplement must be concurred in by a majority of the continuing
directors. Immediately upon the action of the Board of Directors
providing for any amendment or supplement, such amendment or
supplement will be deemed effective.
The Preferred Shares purchasable upon exercise of the
Rights will not be redeemable. Each Preferred Share will be
entitled to a minimum preferential quarterly dividend payment equal
to the greater of $25 per share and 1,000 times the dividend
declared per Common Share. In the event of liquidation, the
holders of the Preferred Shares will be entitled to a minimum
preferential liquidation payment equal to the greater of $100 per
share and 1,000 times the payment made per Common Share. Each
Preferred Share will have 1,000 votes per share, voting together
with the Common Shares. In the event of any merger, consolidation
or other transaction in which Common Shares are exchanged, each
Preferred Share will be entitled to receive 1,000 times the amount
received per Common Share. These rights are protected by customary
antidilution provisions.
The Rights have certain anti-takeover effects. The
Rights may cause substantial dilution to a person or group other
than an exempt person that attempts to acquire the Company on terms
not approved by the Board, except pursuant to an offer conditioned
on a substantial number of Rights being acquired. The Rights
should not interfere with any merger or other business combination
approved by the Board of Directors prior to the time a person or
group other than an exempt person has acquired beneficial ownership
of 15% or more of the Common Shares, because until such time the
Rights may generally be redeemed by the Company at $.01 per Right.
Until a Right is exercised, the holder thereof, as such,
will have no rights as a stockholder of the Company, including,
without limitation, the right to vote or to receive dividends.
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an Exhibit to an Application
for Registration on Form 8-A. A copy of the Rights Agreement is
available free of charge from the Company. This summary
description of the Rights does not purport to be complete and is
qualified in its entirety by reference to the Rights Agreement,
which is hereby incorporated herein by reference.
