Securities And Exchange Commission
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported)
October 6, 1997
Pfizer Inc.
(Exact name of registrant as specified in its charter)
Delaware 1-3619 13-5315170
(State or Other (Commission File (I.R.S. Employer
Jurisdiction of Number) Identification No.)
Incorporation)
235 East 42nd Street
New York, New York 10017
(Address of Principal Executive (Zip Code)
Offices
Registrant's telephone number, including area code:
(212) 573-2323
Item 5. Other Events
Effective October 6, 1997 the Board of Directors of Pfizer Inc. (the
Company") declared a dividend of one preferred stock purchase right (a
"Right") for each share of common stock of the Company (the "Common Stock").
The dividend was directed to be issued to stockholders of record as of the
close of business on October 6, 1997. Each Right represents the right to
purchase one thousandth of a share of Series A Junior Preferred Stock
("Preferred Stock"), of the Company at a price of $275 (as the same may be
adjusted, the "Exercise Price"). The description and terms of the Rights are
set forth in a Rights Agreement (as the same may be amended from time to time,
the "Rights Agreement") dated as of October 6, 1997, between the Company and
ChaseMellon Shareholder Services L.L.C., as Rights Agent (the "Rights Agent").
The summary description of the Rights set out below does not purport to
be complete, and is qualified in its entirety by reference to the Rights
Agreement, as the same may be amended from time to time, which is hereby
incorporated herein by reference.
The Rights will be evidenced by Common Stock certificates until the
earlier to occur of (i) 10 days following a public announcement that a person
or group of affiliated or associated persons (with certain exceptions, an
"Acquiring Person") have acquired beneficial ownership of 15% or more of the
outstanding shares of Common Stock or (ii) 10 business days (or such later
date as may be determined by action of the Board of Directors prior to such
time as any person or group of affiliated persons becomes an Acquiring Person)
following the commencement of, or announcement of an intention to make, a
tender offer or exchange offer the consummation of which would result in the
beneficial ownership by a person or group of 30% or more of the outstanding
shares of Common Stock (the earlier of such dates being called the
"Distribution Date").
The Rights Agreement provides that, until the Distribution Date (or
earlier redemption or expiration of the Rights): (i) the Rights will be
transferred with and only with the Common Stock; (ii) Common Stock
certificates will contain a notation referencing the Rights and Rights
Agreement; and (iii) the surrender for transfer of any certificates for shares
of Common Stock will also constitute the transfer of the Rights associated
with the shares of Common Stock 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 Stock as of the close of business on the Distribution Date and
thereafter such separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights
will expire on October 5, 2007 (the "Final Expiration Date"), unless the
Rights are earlier redeemed or exchanged by the Company, in each case as
described below.
The Exercise Price payable, and the number of shares of Preferred Stock
or other securities or property issuable, upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution, for example, in
the event of a stock dividend on, or a subdivision, combination or
reclassification of, the Common Stock.
Shares of Preferred Stock purchasable upon exercise of the Rights will
be entitled, when, as and if declared, to a minimum preferential quarterly
dividend payment of 1000 times the per share amount of dividends declared on
common stock. If no common stock dividend is declared in a quarter, a
preferred stock dividend of $100 per share will be required. In the event of
liquidation, dissolution or winding up of the Company, the holders of the
Preferred Stock will be entitled to a preferential distribution payment of at
least 1000 times the payment made per share of Common Stock. Each share of
Preferred Stock will entitle the holder to one vote, voting together with the
Common Stock. Finally, in the event of any merger, consolidation or other
transaction in which shares of Common Stock are converted or exchanged, the
holder of each share of Preferred Stock will be entitled to receive 1000 times
the amount of consideration received per share of Common Stock in respect of
such transaction. The Rights are protected by customary antidilution
provisions.
Because of the nature of the Preferred Stock's dividend and liquidation
rights, the fair market value of the one thousandth of a share of Preferred
Stock purchasable upon exercise of each Right should approximate the fair
market value of one share of Common Stock.
If any person or group of affiliated or associated persons becomes an
Acquiring Person, each holder of a Right, (other than Rights beneficially
owned by the Acquiring Person, which become void), will have the right to
receive upon exercise and payment of the then current Exercise Price, that
number of shares of Preferred Stock having a market value of two times the
Exercise Price.
If, after a person or group has become an Acquiring Person, the Company
is acquired in a merger or other business combination transaction, or 50% or
more of its consolidated assets or earning power are sold, proper provision
will be made so that each holder of a Right (other than Rights beneficially
owned by an Acquiring Person, which become void) will thereafter have the
right to receive, upon exercise at the then current Exercise Price, that
number of shares of common stock of the person with whom the Company has
engaged in the foregoing transaction (or its parent), which at the time of
such transaction will have a market value of two times the Exercise Price.
In lieu of exercise, the Board of Directors of the Company may exchange
the Rights (other than Rights owned by the Acquiring Person, which become
void), in whole or in part, for such securities or other property or rights as
the Board may determine, including common stock or preferred stock of the
Company of any class or series.
No fractional shares of Preferred Stock will be issued, other than
fractions which are integral multiples of one thousandth of a share, which
may, at the election of the Company, be evidenced by depositary receipts. In
lieu of any other fractional interest, an adjustment in cash will be made
based on the market price of the Preferred Stock.
At any time prior to the time an Acquiring Person becomes 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, subject to adjustment (the "Redemption
Price"). The redemption of the Rights may be made effective at such time, on
such basis and with such conditions as the Board of Directors may establish.
Immediately upon any redemption of the Rights, the right to exercise the
Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price. The Rights may be amended by the Company to the
extent and on the conditions set out in the Rights Agreement.
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 7. Exhibits.
1. Rights Agreement, dated as of October 6, 1997, between the Company
and ChaseMellon Shareholder Services L.L.C.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PFIZER INC.
Dated:October 6, 1997
By:/s/ C.L. Clemente
______________________
Name: C.L. Clemente
Title: Senior Vice President &
Secretary
EXHIBIT INDEX
Exhibit No. Description
1 Rights Agreement, dated as of October 6, 1997,
between the Company and ChaseMellon Shareholder
Services L.L.C.
<PAGE>
RIGHTS AGREEMENT
This Rights Agreement (this "Agreement" or "Agreement") is entered
into effective October 6, 1997 by and between PFIZER INC., a Delaware
corporation (the "Company"), and CHASEMELLON SHAREHOLDER SERVICES, L.L.C., a
limited liability company registered in the State of New Jersey (the "Rights
Agent").
W I T N E S S E T H :
WHEREAS, as of September 25, 1997, the Board of Directors of the
Company authorized the issuance of, and declared a dividend payable in, one
"Right" for each share of Common Stock of the Company outstanding as of the
close of business on October 6, 1997 (the "Record Date"), with each such Right
entitling the holder to purchase 1/1000 of a share of Series A Junior
Preferred Stock of the Company, upon the terms and subject to the conditions
set forth in this Agreement; and
WHEREAS, the above-named Rights Agent has agreed to serve in that
capacity as prescribed herein; and
WHEREAS, the Board of Directors of the Company has granted the
Rights by means of a contemporaneous distribution thereof to all Record Date
holders of the aforesaid Common Stock, and by means of issuance of such Rights
in tandem with all other shares of Common Stock that are issued thereafter and
prior to the earlier of the Expiration Date and the Final Expiration Date; and
WHEREAS, the Board of Directors of the Company has approved the
terms and conditions of the Rights and the other provisions hereof such that
each Right shall have the attributes of and be subject to the terms and
conditions provided herein.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions
Unless otherwise defined in this Agreement, capitalized terms used herein
shall have the meanings ascribed to such terms as provided below. Any
determination made by the Board of Directors of the Company for purposes of
applying the definitions contained in this Agreement shall be final and
binding on the Rights Agent and the holders of the Rights for all purposes.
(a) "Acquiring Person" shall mean any Person who or which, together
with all Affiliates and Associates of such Person, shall be the Beneficial
Owner of 15% or more of the shares of Voting Stock of the Company then out-
standing; provided, however, that an Acquiring Person shall not include an
Exempt Person or any Person, together with all Affiliates and Associates of
such Person, who or which would be an Acquiring Person by reason of (i) being
the Beneficial Owner of shares of Voting Stock of the Company, the Beneficial
Ownership of which was acquired by such Person (or his or its predecessor)
pursuant to a transaction or series of related transactions approved by the
Board of Directors of the Company and effected before such Person (or his or
its predecessor) otherwise became an Acquiring Person, (ii) a reduction in the
number of issued and outstanding shares of Voting Stock of the Company
pursuant to a transaction or a series of related transactions approved by the
Board of Directors of the Company, or (iii) any action or transaction deemed
by the Board of Directors of the Company not to cause such Person to become an
Acquiring Person, which determination is made prior to such Person (or his or
its predecessor) otherwise becoming an Acquiring Person. If a Person does not
become an Acquiring Person by reason of clause (i), (ii) or (iii) above, such
Person nonetheless shall become an Acquiring Person if such Person thereafter
acquires Beneficial Ownership of an additional 1% of the Voting Stock of the
Company, unless the exemption of clause (i), (ii) or (iii) above apply to that
subsequent acquisition. Notwithstanding the foregoing, if the Board of
Directors of the Company determines that a Person who would otherwise be an
"Acquiring Person" as defined pursuant to the foregoing provisions of this
paragraph (a) has become such inadvertently, and such Person divests as
promptly as practicable (as determined by the Board of Directors) a sufficient
number of shares of Voting Stock so that such Person would no longer be an
"Acquiring Person" as defined pursuant to the foregoing provisions of this
paragraph, then such Person shall not be deemed an "Acquiring Person" for any
purposes of this Agreement.
(b) "Affiliate" shall have the meaning ascribed to such term in Rule
12b-2 of the General Rules and Regulations under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), as in effect on the date of this
Agreement
(c) "Agreement" shall mean this Agreement, as amended and restated
from time to time.
(d) "Associate" of a Person shall mean (i) with respect to a
corporation, any officer or director thereof or of any Subsidiary thereof, or
any Beneficial Owner of 10% or more of any class of equity security thereof,
(ii) with respect to an association, any officer or director thereof or of a
Subsidiary thereof, (iii) with respect to a partnership, any general partner
thereof or any limited partner thereof who is, directly or indirectly, the
Beneficial Owner of a 10% ownership interest therein, (iv) with respect to a
business trust, any officer or trustee thereof or of any Subsidiary thereof,
(v) with respect to any other trust or an estate, any trustee, executor or
similar fiduciary or any Person who has a 20% or greater interest as a bene-
ficiary in the income from or principal of such trust or estate or who
otherwise has a substantial beneficial interest in such trust or estate, (vi)
with respect to a natural person, any relative or spouse of such person, or
any relative of such spouse, who has the same home as such person, and (vii)
any Affiliate of such Person.
(e) A person shall be deemed the "Beneficial Owner" of, acquire
Beneficial Ownership of, or to "beneficially own", any securities:
(i) which such Person or any of such Person's Affiliates or
Associates beneficially owns, directly or indirectly, for purpose of Section
13(d) of the Exchange Act and Regulation 13D-G thereunder (or any comparable
or successor law or regulation), in each case as in effect on the date of this
Agreement; and
(ii) which such Person or any of such Person's Affiliates or
Associates has (A) the right to acquire (whether such right is exercisable
immediately or only after the passage of time or the fulfillment of a
condition or both) pursuant to any agreement, arrangement or understanding, or
upon the exercise of conversion rights, exchange rights, other rights (other
than the Rights), warrants or options, or otherwise; provided, however, that a
Person shall not be deemed the "Beneficial Owner" of, or to "beneficially
own", securities tendered pursuant to a tender or exchange offer made by such
Person or any of such Person's Affiliates or Associates until such tendered
securities are accepted for purchase or exchange or (B) the right to vote,
alone or in concert with others, pursuant to any agreement, arrangement or
understanding (whether or not in writing); provided, however, that a Person
shall not be deemed the "Beneficial Owner" of, or to "beneficially own", any
securities if the agreement, arrangement or understanding to vote such
security (1) arises solely from a revocable proxy or consent given in response
to a proxy or consent solicitation made pursuant to, and in accordance with,
the applicable rules and regulations under the Exchange Act and (2) is not at
the time reportable by such Person on a Schedule 13D report under the Exchange
Act (or any comparable or successor report), other than by reference to a
proxy or consent solicitation being conducted by such Person; or
(iii) which are beneficially owned, directly or indirectly, by any
other Person with which such Person or any of such Person's Affiliates or
Associates has any agreement, arrangement or understanding (whether or not in
writing) for the purpose of acquiring, holding, voting (except as described in
clause B of subparagraph (ii) of this paragraph (d)) or disposing of any
securities of the Company.
Notwithstanding the foregoing, for purposes of determining beneficial
ownership of securities under this Agreement, officers and directors of the
Company shall not constitute a group (notwithstanding that they may be Associ-
ates of one another or may be deemed to constitute a group for purposes of the
Exchange Act) and shall not be deemed to own shares owned by another officer
or director of the Company.
(f) "Business Day" shall mean any day other than a Saturday, Sunday,
or a day on which banking institutions in the State of New York are authorized
or obligated by law or executive order to close.
(g) "Close of Business" on any given date shall mean 5:00 P.M., New
York time, on such date; provided, however, that if such date is not a
Business Day, it shall mean 5:00 P.M., New York time, on the next succeeding
Business Day.
(h) "Common Stock" shall mean the Common Stock (presently $0.05 par
value) of the Company. "Common Stock" when used with reference to the
Principal Party shall mean the capital stock or other equity security with the
greatest voting power of the Principal Party and, when used with reference to
any Person other than the Company or the Principal Party, shall mean the
capital stock or other equity security with the greatest voting power of such
Person or, if such Person is a Subsidiary of or is controlled by another
Person, the Person which ultimately controls such first mentioned Person.
(i) "Company" shall have the meaning set forth in the Recitals of this
Agreement.
(j) "Distribution Date" shall have the meaning set forth in Section
3(b) hereof.
(k) "Exchange Act" shall have the meaning set forth in Section l(b)
hereof.
(l) "Exempt Person" shall mean the Company, any Subsidiary of the
Company, any employee benefit plan or employee stock plan of the Company or of
any Subsidiary of the Company, or any trust or other entity organized,
appointed, established or holding Common Stock for or pursuant to the terms of
any such plan.
(m) "Exercise Price" shall have the meaning set forth in Section 7(b)
hereof.
(n) "Expiration Date" shall have the meaning set forth in Section 7(a)
hereof.
(o) "Fair Market Value" of any property shall mean the fair market
value of such property as determined in accordance with Section 11(b) hereof.
(p) "Final Expiration Date" shall have the meaning set forth in
Section 7(a) hereof.
(q) "Person" shall mean any individual, firm, corporation or other
entity.
(r) "Preferred Stock" shall have the meaning set forth in the Recitals
of this Agreement.
(s) "Principal Party" shall have the meaning set forth in Section
13(b) hereof.
(t) "Record Date" for the Rights shall mean October 3, 1997, at the
close of business on that date.
(u) "Redemption Price" shall have the meaning set forth in Section
23(a) hereof.
(v) A "Right" shall mean the right to purchase one thousandth (1/1000)
of a share of Preferred Stock, subject to exercise, expiration, nullification,
redemption, adjustment and all other terms and conditions of a Right as
provided herein.
(w) "Rights Agent" shall have the meaning set forth in the Recitals of
this Agreement.
(x) "Right Certificate" shall have the meaning set forth in Section
3(d) hereof.
(y) "Stock Acquisition Date" shall mean the first date by which both
(i) an Acquiring Person has become such and (ii) a public announcement of such
fact has been made by either the Company or such Acquiring Person.
(z) "Subsidiary" of a Person shall mean any corporation or other
entity of which securities or other ownership interests having voting power
sufficient to elect a majority of the board of directors or other persons
performing similar functions are beneficially owned, directly or indirectly,
by such Person or by any corporation or other entity that is otherwise
controlled by such Person.
(aa) "Summary of Rights" shall have the meaning set forth in Section
3(a) hereof.
(bb) "Trading Day" shall have the meaning set forth in Section 11(b)
hereof.
(cc) "Transfer Tax" shall mean any tax or charge, including any
documentary stamp tax, imposed or collected by any governmental or regulatory
authority in respect of any transfer of any security, instrument or right,
including Rights, shares of Common Stock and shares of Preferred Stock.
(dd) "Voting Stock" shall mean (i) the Common Stock of the
Company and (ii) any other shares of capital stock of the Company entitled to
vote generally in the election of directors or entitled to vote together with
the Common Stock in respect of any merger, consolidation, sale of all or
substantially all of the Company's assets, liquidation, dissolution or winding
up.
Section 2. Appointment of Rights Agent
The Company hereby appoints the Rights Agent to act as agent for the Company
and the holders of the Rights 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 replacement Rights Agent or Co-Rights Agents as
it may deem necessary or desirable.
Section 3. Issuance of Right Certificates
(a) Following the initial issuance of the Rights, the Company shall
send a Summary of Rights describing the Rights to each holder of the Common
Stock as of the close of business on the Record Date. The Summary of Rights
will be deemed amended by any amended terms hereof included as an exhibit to
any of the Company's reports to the Securities and Exchange Commission. At
any time or times it deems appropriate, the Company may issue a revised
Summary of Rights or other summary of the then-current terms of the Rights and
publish or provide it to such holders of Common Stock or the Rights as it
deems appropriate.
(b) Until the earlier to occur of (i) the close of business on the
tenth day after the Stock Acquisition Date, and (ii) the close of business on
the tenth day (or such later date as may be determined by the Board of
Directors prior to such time as any Person becomes an Acquiring Person) after
the date of the commencement by any Person (other than an Exempt Person) of,
or the first public announcement of the intent of any Person (other than an
Exempt Person) to commence, a tender or exchange offer upon the successful
consummation of which such Person, together with its Affiliates and
Associates, would be the Beneficial Owner of 30% or more of the then
outstanding shares of Voting Stock of the Company (irrespective of whether any
shares are actually purchased pursuant to any such offer), (the earlier of
such dates being herein referred to as the "Distribution Date"), (x) the
Rights shall be evidenced (subject to the provisions of Section 3(a)) by the
certificates for Common Stock registered in the name of the holders of the
Common Stock (which certificates for Common Stock shall also constitute
certificates for Rights) and not by separate Right Certificates, and the
record holders of such certificates for Common Stock shall be the record
holders of the Rights represented thereby and (y) each Right shall be
transferable only simultaneously and together with the transfer of a share of
Common Stock (subject to adjustment as hereinafter provided). Until the
Distribution Date (or, if earlier, the Expiration Date or Final Expiration
date), the surrender for transfer of any certificate for Common Stock shall
constitute the surrender for transfer of the Right or Rights associated with
the Common Stock evidenced thereby, whether or not a copy of the Summary of
Rights is transferred simultaneously with such share certificate.
(c) Certificates for Common Stock issued after the Record Date but
prior to the earliest of the Distribution Date, the Expiration Date, or the
Final Expiration Date shall have impressed, printed, written or stamped
thereon or otherwise affixed thereto the following legend:
This certificate also evidences and entitles the holder hereof to
the same number of Rights as the number of shares of Common Stock represented
by this certificate. These Rights are described in the Rights Agreement of
Pfizer Inc. (as it may be amended from time to time, the "Rights Agreement").
Under circumstances set forth in the Rights Agreement, the Rights shall be
evidenced by separate Right Certificates, and shall no longer be evidenced by
this certificate. The terms of the Rights Agreement are incorporated herein
by reference. A copy is on file with the Corporate Secretary of Pfizer Inc.
at its principal executive offices. Without charge, Pfizer Inc. will mail to
the registered holder of this certificate a copy of the Rights Agreement
within five days after receipt of a written request directed to its Corporate
Secretary. UNDER CIRCUMSTANCES DESCRIBED IN THE RIGHTS AGREEMENT, RIGHTS
ISSUED TO OR OWNED BY "ACQUIRING PERSONS," THEIR "AFFILIATES" AND "ASSOCIATES"
(AS DEFINED THEREIN), AND ANY SUBSEQUENT HOLDER SHALL BE NULL AND VOID AND MAY
NOT BE TRANSFERRED TO ANY PERSON.
Certificates for Common Stock bearing a legend similar to the above which was
authorized by any prior effective rights agreement of the Company may also be
used until the supply of such Certificates is exhausted.
(d) As promptly as practicable after the Distribution Date, the Rights
Agent shall send, by first class mail, postage prepaid, to each record holder
of the Common Stock as of the close of business on the Distribution Date, as
shown by the records of the Company, at the address of such holder shown on
such records, a certificate in the form provided by Section 4 hereof (a "Right
Certificate"), evidencing one Right for each share of Common Stock so held. As
of and after the Distribution Date, the Rights shall be evidenced solely by
Right Certificates, and may be transferred by the transfer of the Right
Certificate as permitted hereby, separately and apart from any transfer of one
or more shares of Common Stock.
Section 4. Form of Right Certificates
(a) The Right Certificates (and the forms of election to purchase
shares, certificate as to status and assignment to be printed on the back
thereof), when, as and if issued, shall be substantially in the form set forth
in Exhibit A hereto and may have such marks of identification or designation
and such legends, summaries or endorsements printed thereon as may be required
to comply with any law or with any rule or regulation made pursuant thereto or
with any rule or regulation of any stock exchange on which the Common Stock or
the Rights may from time to time be listed or as the Company may deem
appropriate to conform to usage or otherwise and as are not inconsistent with
the provisions of this Agreement. Subject to the provisions of Section 22
hereof, Right Certificates evidencing Rights 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 Exercise Price provided herein as the same may
from time to time be adjusted according to the terms hereof.
(b) Notwithstanding any other provision of this Agreement, any Right
Certificate that represents Rights beneficially owned by an Acquiring Person
or any Affiliate or Associate thereof shall have impressed on, printed on,
written on or otherwise affixed to it (if the Company or the Rights Agent has
knowledge that such Person is an Acquiring Person or an Associate or Affiliate
or a nominee of any of the foregoing) the following legend:
The Beneficial Owner of the Rights represented by this Right Certificate
is an Acquiring Person or an Affiliate or an Associate of an Acquiring Person.
Accordingly, this Right Certificate and the Rights represented hereby may be
or may become void in the circumstances specified in Section 7 of the Rights
Agreement.
Section 5. Countersignature and Registration
(a) Each Right Certificate shall be executed on behalf of the Company
by its Chairman of the Board of Directors, President or any Vice President,
either manually or by facsimile signature, and have affixed thereto the
Company's seal or a facsimile thereof which shall be attested by the Secretary
or an Assistant Secretary of the Company, either manually or by facsimile
signature. Each Right Certificate shall be countersigned by the Rights Agent
either manually or by facsimile signature and shall not be valid for any
purpose unless so countersigned. In case any officer of the Company who shall
have signed any Right Certificate shall cease to be such officer of the
Company before countersignature by the Rights Agent and issuance and delivery
of the certificate by the Company, such Right 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 Right Certificates had
not ceased to be such officer of the Company. Any Right Certificate may be
signed on behalf of the Company by any person who, on the date of the
execution of such Right Certificate, shall be a proper officer of the Company
to sign such Right Certificate, although at the date of the execution of this
Agreement any such person was not such an officer.
(b) Following the Distribution Date, the Rights Agent will keep
or cause to be kept books for registration and transfer of the Right
Certificates issued hereunder at its shareholder services office or offices
designated as the appropriate place for surrender of certificates upon
exercise or transfer. Such books shall show the names and addresses of the
respective holders of the Right Certificates, the number of Rights evidenced
on its face by each of the Right Certificates, the date of each of the Right
Certificates, and such other information deemed appropriate by the Rights
Agent and/or the Company.
Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen Right Certificates
(a) Subject to the provisions of Section 14(b) hereof, at any time
after the close of business on the Distribution Date, and at or prior to the
close of business on the earlier of the Expiration Date or the Final
Expiration Date, any Right Certificate may be (i) transferred or (ii) split
up, combined or exchanged for one or more other Right Certificates, entitling
the registered holder to purchase a like number of shares of Preferred Stock
as the Right Certificate surrendered then entitled such holder to purchase.
Any registered holder desiring to transfer any Right Certificate shall
surrender the Right Certificate at the shareholder services office of the
Rights Agent with the form of certificate and assignment on the back thereof
endorsed (or with a written instrument of transfer in form satisfactory to the
Company and the Rights Agent enclosed with such Right Certificate), executed
by the registered holder thereof or his attorney authorized in writing, and
with such signature guaranteed by a commercial bank or brokerage firm
registered with the New York Stock Exchange. Any registered holder desiring to
split up, combine or exchange any Right Certificate shall make such request in
writing delivered to the Rights Agent, and shall surrender the Right
Certificate to be split up, combined or exchanged at the office of the Rights
Agent designated for such purpose. Thereupon, the Rights Agent shall
countersign and deliver to the person entitled thereto a Right Certificate or
Right Certificates, as the case may be, as so requested. The Company may
require payment of a sum sufficient to cover any Transfer Tax that may be
imposed in connection with any transfer, split up, combination or exchange of
any Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation
of a Right Certificate, and, in case of loss, theft or destruction, of indem-
nity or security reasonably satisfactory to them and, if requested by the
Company, reimbursement to the Company and the Rights Agent of all reasonable
expenses incidental thereto, or upon surrender to the Rights Agent and
cancellation of a mutilated Right Certificate, the Company shall issue and
deliver a new Right Certificate of like tenor to the Rights Agent for delivery
to the registered owner in lieu of the Right Certificate so lost, stolen,
destroyed or mutilated.
Section 7. Exercise of Rights: Exercise Price; Expiration Date of Rights;
Nullification of Certain Rights; Related Matters
(a) The Rights shall not be exercisable until, but shall become
exercisable on, the Distribution Date, unless otherwise provided herein,
including, without limitation, the restrictions on exercisability set forth in
Section 23(a) hereof. The Rights may be exercised, in whole or in part, upon
surrender of the Right Certificate, with the form of election to purchase and
certificate on the back thereof duly executed (with signatures duly
guaranteed), to the Rights Agent at the office of the Rights Agent designated
for such purpose, together with payment of the Exercise Price with respect to
each Right exercised, subject to adjustment as hereinafter provided. Such
exercise will be permitted only on and after the Distribution Date and at or
prior to the close of business on the earlier of (i) October 5, 2007 (the
"Final Expiration Date") or (ii) the date on which the Rights are redeemed as
provided in Section 23 hereof (such earlier date being herein referred to as
the "Expiration Date").
(b) The Exercise Price initially set under this Agreement shall be
$275.00 for each one thousandth (1/1000) of a share of Preferred Stock issued
pursuant to the exercise of a Right. The Exercise Price and the number of
shares of Preferred Stock or other securities to be acquired upon exercise of
a Right shall be subject to adjustment from time to time as provided herein.
The Exercise Price shall be payable in lawful money of the United States of
America, in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate with the form of election to
purchase and certificate duly executed, accompanied by payment by check or
money order payable to the order of the Company or the Rights Agent of the
Exercise Price or so much thereof as is necessary for the purchase of shares
or other securities to be purchased upon exercise of the Rights and an amount
equal to any applicable Transfer Tax, the Rights Agent shall thereupon
promptly (i) requisition from the Company, as transfer agent of the Preferred
Stock, (or such other transfer agent, if applicable) one or more certificates
representing the number of shares of Preferred Stock to be so purchased, which
requests the Company hereby authorizes and directs itself, as transfer agent,
(or such other transfer agent, if applicable) to comply with, (ii) as provided
in Section 14(b), at the election of the Company, cause depository receipts to
be issued in lieu of fractional shares of Preferred Stock, (iii) when
appropriate, requisition from the Company the amount of cash to be paid in
lieu of issuing fractional shares in accordance with Section 14(b) hereof and
(iv) cause such Preferred Stock certificates and/or depository receipts or
cash payments to be delivered to or upon the order of the registered holder of
such Right Certificate, registered in such name or names as may be designated
by such holder, and, when appropriate, after receipt, promptly deliver such
cash to or upon the order of the registered holder of such Right Certificate;
provided, however, that in the case of a purchase of securities, other than
Preferred Stock, pursuant to Section 13 hereof, the Rights Agent shall
promptly take the appropriate action corresponding in such case to that
referred to in the foregoing clauses (i) through (iv) of this Section 7(c).
Notwithstanding the foregoing provisions of this Section 7(c), the Company may
suspend the issuance of shares of Preferred Stock upon exercise of a Right for
a reasonable period, not in excess of 90 days, during which the Company seeks
to register under the Securities Act of 1933, as amended, and any applicable
securities law of any other jurisdiction the shares of Preferred Stock to be
issued pursuant to the Rights; provided, however, that nothing contained in
this Section 7(c) shall relieve the Company of its obligations under Section
9(c) hereof.
(d) In case the registered holder of any Right Certificate shall
exercise less than all the Rights evidenced thereby, a new Right Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be
issued by the Rights Agent to the registered holder of such Right Certificate
or his assign, subject to the provisions of Section 14(b) hereof.
(e) Notwithstanding any provision of this Agreement to the contrary,
from and after the time when any Person first becomes an Acquiring Person, any
Rights that are beneficially owned by (x) such Acquiring Person (or any
Associate or Affiliate of such Acquiring Person), (y) a transferee of such
Acquiring Person (or any such Associate or Affiliate) who becomes a transferee
after such time, or (z) a transferee of such Acquiring Person (or any such
Associate or Affiliate) who becomes a transferee prior to or concurrently with
that event pursuant to either (i) a transfer from the Acquiring Person to
holders of its equity securities or to any Person with whom it has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (ii) a transfer which the Board of Directors has determined is part
of a plan, arrangement or understanding which has the purpose or effect of
avoiding the provisions of this Section 7(e), and subsequent transferees of
such Persons referred to in clause (y) and (z) above, shall be void without
any further action and any holder of such Rights shall thereafter have no
rights whatsoever with respect to such Rights, whether under any provision of
this Agreement or otherwise. The Company shall use all reasonable efforts to
ensure that the provisions of this Section 7(e) are complied with, but shall
have no liability to any holder of Right Certificates or any other Person as a
result of its failure to make any determination with respect to an Acquiring
Person or its Affiliates, Associates or transferees. No Right Certificate
shall be issued pursuant to Section 3 hereof that represents Rights
beneficially owned by an Acquiring Person whose Rights would be void pursuant
to the provisions of this Section 7(e) or any Associate or Affiliate thereof.
No Right Certificate shall be issued at any time upon the transfer of any
Rights to an Acquiring Person whose Rights would be void pursuant to the
Provisions of this Section 7(e) or any Associate or Affiliate thereof or to
any nominee of such Acquiring Person, Associate or Affiliate. Any Right
Certificate delivered to the Rights Agent for transfer to an Acquiring Person
whose Rights would be void pursuant to the provisions of this Section 7(e)
shall be canceled.
(f) [INTENTIONALLY OMITTED.]
(g) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder upon the occurrence of any
purported exercise as set forth in this Section 7 unless such registered
holder shall have (i) completed and signed the certificate following the form
of election to purchase set forth on the back of the Right Certificate
surrendered for such exercise and (ii) provided such additional evidence of
the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company shall reasonably request.
Section 8. Cancellation and Destruction of Right Certificates
All Right Certificates surrendered for the purpose of exercise, transfer,
split up, combination or exchange shall, if surrendered to the Company or 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 Right Certificates shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Agreement. The Company
shall deliver to the Rights Agent for cancellation and retirement, and the
Rights Agent shall cancel and retire, any Right Certificate purchased or
acquired by the Company otherwise than upon the exercise thereof. The Rights
Agent shall deliver all canceled Right Certificates to the Company, or shall,
at the written request of the Company, destroy such canceled Right
Certificates, and in such case shall deliver a certificate of destruction
thereof to the Company.
Section 9. Reservation and Availability of Shares of Preferred Stock
(a) The Company covenants and agrees that it will cause to be reserved
and kept available out of its authorized and unissued shares of preferred
stock or out of authorized and issued shares of Preferred Stock held in its
treasury, such number of shares of Preferred Stock as will from time to time
be sufficient to permit the exercise in full of all outstanding Rights. The
Company shall take such action as may be required for it to comply with the
foregoing sentence of this Section 9(a).
(b) The Company shall use its best efforts to cause, from and after
such time as the Rights become exercisable, all shares of Preferred Stock
issued or reserved for issuance in accordance with this Agreement to be
listed, upon official notice of issuance, upon the principal national
securities exchange, if any, upon which the Common Stock is listed or, if the
principal market for the Common Stock is not on any national securities
exchange, to be eligible for quotation in the National Association of
Securities Dealers' Automated Quotation System or any successor thereto or
other comparable quotation system.
(c) The Company covenants and agrees that it will take all such action
as may be necessary to insure that all shares of Preferred Stock delivered
upon exercise of Rights shall, at the time of delivery of the certificates for
such shares (subject to payment of the Exercise Price in respect thereof), be
duly and validly authorized and issued and fully paid and nonassessable
shares.
(d) The Company further covenants and agrees that it will pay when due
and payable any and all federal and state Transfer Taxes which may be payable
in respect of the issuance or delivery of the Right Certificates or of any
shares of Preferred Stock issued or delivered upon the exercise of Rights. The
Company shall not, however, be required to pay any Transfer Tax which may be
payable in respect of any transfer or delivery of a Right Certificate to a
Person other than, or the issuance or delivery of certificates for Preferred
Stock upon exercise of Rights in a name other than that of, the registered
holder of the Right Certificate. The Company shall not be required to issue
or deliver a Right Certificate or certificate for Preferred Stock to a person
other than such registered holder until any such Transfer Tax shall have been
paid (any such Transfer Tax being payable by the holder of such Right
Certificate at the time of surrender) or until it has been established to the
Company's satisfaction that no such Transfer Tax is due.
Section 10. Preferred Stock Issuance Date
Each Person in whose name any certificate for shares of Preferred Stock is
issued upon the exercise of Rights shall for all purposes be deemed to have
become the holder of record of the Preferred Stock represented thereby on, and
such certificate shall be dated as of, the date upon which the Right Certifi-
cate evidencing such Rights was duly surrendered and payment of the Exercise
Price (and any applicable Transfer Taxes) was made. If the date of such
surrender and payment is a date upon which the Preferred Stock transfer books
of the Company are closed, however, such person shall be deemed to have become
the record holder of such shares on, and such certificate shall be dated as
of, the next succeeding Business Day on which the Preferred Stock transfer
books of the Company are open. Prior to the exercise of the Rights evidenced
thereby, the holder of a Right Certificate, as such, shall not be entitled to
any rights of a stockholder of the Company with respect to shares for which
the Rights shall be exercisable, including, without limitation, the right to
vote, to receive dividends or other distributions or to exercise any
preemptive rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
Section 11. Adjustment of Exercise Price or Number of Shares; Alternative
Payment Upon Exercise; Exchange in Lieu of Exercise
The Exercise Price, the number of shares which may be purchased upon exercise
of a Right and the number of Rights outstanding are subject to adjustment from
time to time as provided in this Section 11.
(a) (i) If the Company shall at any time after the date of
this Agreement
(A) declare or pay any dividend on Common Stock payable in
shares of Common Stock,
(B) subdivide or split the outstanding shares of Common
Stock into a greater number of shares or
(C) combine or consolidate the outstanding shares of
Common Stock into a smaller number of shares or effect a reverse split of the
outstanding shares of Common Stock,
then and in each such event the number of shares of Preferred Stock issuable
upon the exercise of a Right after the record date for such event (if one
shall have established or, if not, after the date of such event) shall be
calculated as follows:
(D) the number of shares of Preferred Stock issuable in
respect of such Right immediately prior to such event shall be multiplied by a
fraction the numerator of which is the number of Rights outstanding immedi-
ately prior to such event and the denominator of which is the number of Rights
outstanding immediately after such event; and
(E) the Exercise Price after such event shall be the
Exercise Price in effect immediately prior to such event multiplied by the
same fraction.
If an event occurs which would require an adjustment under both this Section
11(a)(i) and Section 11(a)(ii) hereof, the adjustment provided for in this
Section 11(a)(i) shall be in addition to, and shall be made prior to, any
adjustment required pursuant to Section 11(a)(ii).
(ii) Subject to clause (iv) below, if any Person, alone or
together with its Affiliates and Associates, shall become an Acquiring Person,
then, effective as of ten days after the Stock Acquisition Date, proper
provision shall be made so that each holder of a Right, except as provided in
Section 7(e) hereof, shall thereafter have a right to receive for each Right,
upon exercise thereof in accordance with the terms of this Agreement and
payment of the Exercise Price, the greater of (1) the number of shares of
Preferred Stock for which such Right was exercisable immediately prior to such
event or (2) such number of shares of Preferred Stock, based on the Fair
Market Value of the Preferred Stock (determined pursuant to Section 11(b)
hereof) on the Stock Acquisition Date, having a value equal to twice the
Exercise Price; provided, however, that if the transaction that would
otherwise give rise to the foregoing adjustment is also subject to the
provisions of Section 13 hereof, then only the provisions of Section 13 hereof
shall apply and no adjustment shall be made pursuant to this Section
11(a)(ii).
(iii) If the Company does not have available sufficient authorized
but unissued Preferred Stock to permit the adjustments required pursuant to
the foregoing subparagraph (i) or the exercise in full of the Rights in
accordance with the foregoing subparagraph (ii), the Company shall take all
such action as may be necessary to authorize and reserve for issuance such
number of additional shares of Preferred Stock as may from time to time be
required to be issued upon the exercise in full of all Rights from time to
time outstanding and, if necessary, shall use its best efforts to obtain
stockholder approval thereof. If the Board of Directors determines that such
action is necessary or appropriate and not contrary to the interests of
holders of Rights, in lieu of issuing shares of Preferred Stock in whole or in
part to satisfy its obligations in accordance with the foregoing subparagraphs
(i) and (ii), the Company may determine to issue or pay, upon the exercise of
the Rights, cash, property, contractual rights, shares of any class or series
of preferred or common stock, or any combination thereof, having an aggregate
Fair Market Value equal to the Fair Market Value of the shares of Preferred
Stock which otherwise would have been issuable.
(iv) At any time following the time that any Person, along or
together with its Affiliates and Associates, shall have become an Acquiring
Person, the Board of Directors may, at its option, determine to exchange for
all or any portion of the outstanding and exercisable Rights either one share
of Common Stock of the Company, 1/1000 of a share of Preferred Stock, or such
cash, property, contractual rights, shares (or fractions thereof) of any class
or series of preferred or common stock of the Company or any subsidiary, or
any combination thereof, having an aggregate Fair Market Value not less than
the Fair Market Value of the Rights exchanged. Upon a determination to effect
such an exchange, all exercisable Rights will be converted into the right to
receive such consideration as the Board determines, the right to exercise such
Rights shall terminate, and the only right thereafter of a holder of such
Rights shall be to receive the consideration determined by the Board of
Directors.
(v) "Fair Market Value" of any security or property shall be
determined by the Board of Directors (which may consider the advice of an
investment banking firm or other advisors of its choosing) pursuant to Section
11(b). Subject to Section 23 hereof, any such determination by the Board of
Directors of the Company must be made (and, in appropriate cases, publicly
announced) promptly, and in any event within thirty days after the date of the
event giving rise to the valuation requirement.
(vi) The Company shall provide notice of any exchange of Rights
to all holders of such Rights at their last addresses as they appear upon the
registry books of the Rights Agent. Any notice which is provided in that
manner shall be deemed given, whether or not the holder receives the notice.
Each such notice of exchange will state the consideration for the exchange,
the method by which the exchange will be effected and, in the event of any
partial exchange, the number of Rights which will be exchanged. Any partial
exchange shall be effected pro rata based on the number of Rights (other than
Rights which have become void pursuant to the provisions of Section 7(e)
hereof) held by each holder of Rights.
(vii) The Company shall not be required to issue fractions of
shares of stock or to distribute certificates which evidence fractional
shares. In lieu of fractional shares, the Company shall pay to the registered
holders of the Right Certificates with regard to which such fractional shares
of stock would otherwise be issuable an amount in cash equal to the same
fraction of the current market value of a whole share of such stock.
(b) For the purpose of this Agreement, the "Fair Market Value" of any
share of Preferred Stock, Common Stock or any other stock or any Right or
other security or any other property on any date shall be determined as
provided in this Section 11(b). In the case of a publicly-traded stock or
other security, the Fair Market Value on any date shall be deemed to be the
average of the daily closing prices per share of such stock or per unit of
such other security for the 30 consecutive Trading Days immediately prior to
such date. If the Fair Market Value per share of any share of common stock is
determined during a period which includes any date that is within 30 Trading
Days after (i) the ex-dividend date for a dividend or distribution on such
stock payable in shares of Common Stock or securities convertible into shares
of Common Stock, or (ii) the effective date of any subdivision, split,
combination, consolidation, reverse stock split or reclassification of such
stock, then, and in each such case, the Fair Market Value shall be
appropriately adjusted by the Board of Directors of the Company to take into
account ex-dividend or post-effective date trading. The closing price for any
day shall be the last sale price, regular way, or, in case no such sale takes
place on such day, the average of the closing bid and asked prices, regular
way (in either case, as reported in the applicable transaction reporting
system with respect to securities listed or admitted to trading on the New
York Stock Exchange). If the securities are not listed or admitted to trading
on the New York Stock Exchange, the Closing Price for any day shall be as
reported in the applicable transaction reporting system with respect to
securities listed on the principal national securities exchange on which such
security is listed or admitted to trading; or, if not listed or admitted to
trading on any national securities exchange, the last quoted price (or, if not
so quoted, the average of the high bid and low asked prices) in the
over-the-counter market, as reported by the National Association of Securities
Dealers, Inc. Automated Quotation System ("NASDAQ") or such other system then
in use; or, if no bids for such security are quoted by any such organization,
the average of the closing bid and asked prices as furnished by a professional
market maker making a market in such security selected by the Board of
Directors of the Company. The term "Trading Day" shall mean a day on which the
principal national securities exchange on which such security is listed or
admitted to trading is open for the transaction of business or, if such
security is not listed or admitted to trading on any national securities
exchange, a Business Day. If a security is not publicly held or not so listed
or traded, "Fair Market Value" shall mean the fair value per share of stock or
per other unit of such other security as determined by an independent
investment banking firm experienced in the valuation of securities, selected
by the Board of Directors of the Company, or, if the Board of Directors shall
determine that no such investment banking firm is available to make such
determination, by the Board of Directors of the Company; provided, however,
that for purposes of making the adjustment provided for by Section 11(a)(ii)
hereof, the Fair Market Value of a share of Preferred Stock shall not be less
than 100% of the product of the Fair Market Value of a share of Common Stock
multiplied by the "Dividend Multiple" applicable to the Preferred Stock (as
such term is then currently defined in the Certificate of Designations
relating to the Preferred Stock) and shall not exceed 105% of the product of
the then Fair Market Value of a share of Common Stock multiplied by the higher
of the then Dividend Multiple or Vote Multiple applicable to the Preferred
Stock. In the case of property other than securities, the "Fair Market Value"
thereof shall be determined by the Board of Directors of the Company based
upon such appraisals or valuation reports of such independent experts as the
Board of Directors of the Company shall determine to be appropriate in
accordance with good business practices and the interests of the holders of
Rights. Any such determination of Fair Market Value shall be described in a
statement filed with the Rights Agent and shall be binding upon the Rights
Agent.
(c) All calculations under this Section 11 shall be made to the
nearest cent or to the nearest ten-thousandth of a share of Preferred Stock,
as the case may be.
(d) Irrespective of any adjustment or change in the Exercise Price or
the number of shares of Preferred Stock issuable upon the exercise of the
Rights, the Right Certificates theretofore and thereafter issued may continue
to express the Exercise Price and the number of shares to be issued upon
exercise of the Rights as in the initial Right Certificates issued hereunder
but, nevertheless, shall represent the Rights as so adjusted.
(e) Anything in this Section 11 to the contrary notwithstanding, in
the event of any reclassification of stock of the Company or any
recapitalization, reorganization or partial liquidation of the Company or
similar transaction, the Board of Directors of the Company shall be entitled
to make such further adjustments in the number of shares of Preferred Stock
which may be acquired upon exercise of the Rights, and such adjustments in the
purchase price per share therefor, in addition to those adjustments expressly
required by the other paragraphs of this Section 11, as the Board of Directors
of the Company shall determine to be necessary or appropriate in order for the
holders of the Rights in such event to be treated equitably and in accordance
with the purpose and intent of this Agreement or in order that any such event
shall not, but for such adjustment, in the opinion of counsel to the Company,
result in the stockholders of the Company being subject to any United States
federal income tax liability by reason thereof.
(f) In the event the Company shall at any time after the Record Date
make any distribution on the shares of Common Stock of the Company, whether by
way of a dividend or a reclassification of stock, a recapitalization,
reorganization or partial liquidation of the Company or otherwise, in cash or
any debt security, debt instrument, real or personal property or any other
rights or property (other than any shares of Common Stock or other capital
stock of the Company and other than any right or warrant to acquire any such
shares, including any debt security convertible into or exchangeable for any
such share, at less than the Fair Market Value of such shares) and the amount
of such cash dividend or the Fair Market Value of such debt security, debt
instrument or property exceeds 150% of the aggregate amount of the cash
dividends declared or paid on the Common Stock of the Company in the 15-month
period immediately preceding such distribution, then and in each such event,
unless such distribution is part of or is made in connection with a
transaction to which Section 11(a)(ii) or Section 13 hereof applies, the
Exercise Price shall be reduced by an amount equal to the cash or the Fair
Market Value of such distribution, as the case may be, per share of Common
Stock of the Company. For purposes hereof, the Fair Market Value of any
property distributed to the holder of shares of Common Stock of the Company
shall be the fair market value of such property as determined by an
independent investment banking firm experienced in the valuation of securities
or the other property so distributed, as the case may be, selected by the
Board of Directors of the Company, or, if the Board of Directors shall
determine that no such investment banking firm is available to make such
determination, by the Board of Directors of the Company, whose determination
shall be final and binding on the Company, the Rights Agent and the holders of
Rights.
(g) Before taking any action that would cause an adjustment reducing
the purchase price per whole share of Preferred Stock upon exercise of the
Rights below the then par value, if any, of the shares of Preferred Stock, the
Company shall use its best efforts to 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 non-assessable shares of such Preferred Stock
at such adjusted purchase price per share.
Section 12. Certification of Adjusted Exercise Price or Number of Shares
Whenever an adjustment is made as provided in Sections 11, 13, or 23(c), the
Company shall (a) promptly prepare a certificate setting forth such adjustment
and a brief statement of the facts giving rise to such adjustment, and (b)
promptly file with the Rights Agent and with the Company as transfer agent for
the Preferred Stock (or such other transfer agent, if applicable) a copy of
such certificate. In addition, the Company may distribute a brief statement
of the effect of such adjustment to the holders of Right Certificates in
accordance with Section 25, or may publish a notice to the same effect.
Notwithstanding the foregoing sentence, the failure of the Company to comply
therewith shall not affect the validity of or the force or effect of the
requirement for such adjustment, and any adjustment to be made pursuant to
Sections 11, 13 or 23(c) of this Agreement shall be effective as of the date
of the event giving rise to such adjustment. The Rights Agent shall be fully
protected in relying on any such certificate and on any adjustment therein
contained and shall not be deemed to have knowledge of any adjustment unless
and until it shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning
Power.
(a) In the event that, at any time after any Person becomes an
Acquiring Person:
(x) the Company shall, directly or indirectly, consolidate with, or
merge with and into, any other Person or Persons and the Company shall not be
the surviving or continuing corporation of such consolidation or merger, or
(y) any Person or Persons shall, directly or indirectly, consolidate
with, or merge with and into, the Company, and the Company shall be the
continuing or surviving corporation of such consolidation or merger and, in
connection with such consolidation or merger, all or part of the outstanding
shares of Common Stock shall be changed into or exchanged for stock or other
securities of any other Person or of the Company or cash or any other
property, or
(z) the Company or one or more of its Subsidiaries shall, directly or
indirectly, sell or otherwise transfer to any other Person or any Affiliate or
Associate of such Person, in one or more transactions, or the Company or one
or more of its Subsidiaries shall sell or otherwise transfer to any Persons in
one or a series of related transactions, assets or earning power aggregating
more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole),
then, on the first occurrence of any such event, proper provision shall be
made so that:
(i) each holder of record of a Right shall thereafter have the
right to receive, upon the exercise thereof and payment of the Exercise Price
in accordance with the terms of this Agreement, such number of shares of
validly issued, fully paid and non-assessable Common Stock of the Principal
Party whose aggregate value shall, based on the Fair Market Value of the
Common Stock of the Principal Party on the date of consummation of such
consolidation, merger, sale or transfer, equal twice the Exercise Price;
(ii) such Principal Party shall thereafter be liable for, and
shall assume, by virtue of such consolidation, merger, sale or transfer, all
the obligations and duties of the Company pursuant to this Agreement;
(iii) the term "Company" for all purposes of this Agreement shall
thereafter be deemed to refer to such Principal Party; and
(iv) such Principal Party shall take such steps (including, but
not limited to, the reservation of a sufficient number of shares of its Common
Stock in accordance with the provisions of Section 9 hereof applicable to the
reservation of Preferred Stock) in connection with such consummation as may be
necessary to assure that the provisions hereof shall thereafter be applicable,
as nearly as reasonably may be, in relation to its shares of Common Stock
thereafter deliverable upon the exercise of the Rights.
However, upon the subsequent occurrence of any merger, consolidation, sale of
all or substantially all of the assets, recapitalization, reclassification of
shares, reorganization or other extraordinary transaction in respect of such
Principal Party, each holder of a Right shall thereupon be entitled to
receive, upon exercise of a Right and payment of the Exercise Price, such
cash, shares, rights, warrants and other property which such holder would have
been entitled to receive had it, at the time of such transaction, owned the
shares of Common Stock of the Principal Party purchasable upon the exercise of
a Right, and such Principal Party shall take such steps (including, but not
limited to, reservation of shares of stock) as may be necessary to permit the
subsequent exercise of the Rights in accordance with the terms hereof for such
cash, shares, rights, warrants and other property.
(b) "Principal Party" shall mean:
(i) in the case of any transaction described in (x) or (y) of
the first sentence of Section 13(a) hereof: (A) the Person that is the issuer
of the securities into which shares of Common Stock of the Company are
converted in such merger or consolidation, or, if there is more than one such
issuer, the issuer the Common Stock of which has the greatest market value or
(B) if no securities are so issued, (x) the Person that is the other party to
the merger or consolidation and that survives such merger or consolidation,
or, if there is more than one such Person, the Person the Common Stock of
which has the greatest market value or (y) if the Person that is the other
party to the merger or consolidation does not survive the merger or
consolidation, the Person that does survive the merger or consolidation
(including the Company if it survives); and
(ii) in the case of any transaction described in (z) of the first
sentence in Section 13(a), the Person that is the party receiving the greatest
portion of the assets or earning power transferred pursuant to such
transaction or transactions, or, if each Person that is a party to such
transaction or transactions receives the same portion of the assets or earning
power so transferred or if the Person receiving the greatest portion of the
assets or earning power cannot be determined, whichever of such Persons as is
the issuer of Common Stock having the greatest market value of shares
outstanding. If the Common Stock of such Person is not at such time and has
not been continuously over the preceding 12-month period registered under
Section 12 of the Exchange Act and such Person is a direct or indirect
Subsidiary of another Person the Common Stock of which is and has been so
registered, the term "Principal Party" shall refer to such other Person, or if
such Person is a Subsidiary, directly or indirectly, of more than one person,
the Common Stocks of all of which are and have been so registered, the term
"Principal Party" shall refer to whichever of such Persons is the issuer of
the Common Stock having the greatest market value of shares outstanding.
(c) The Company shall not consummate any consolidation, merger
or sale or transfer of assets or earning power referred to in Section 13(a)
unless prior thereto the Company and the Principal Party involved therein
shall have executed and delivered to the Rights Agent an agreement confirming
that the Principal Party shall, upon consummation of such consolidation,
merger or sale or transfer of assets or earning power, assume this Agreement
in accordance with Sections 13(a) and (b) hereof and that all rights of first
refusal or preemptive rights in respect of the issuance of shares of Common
Stock of the Principal Party upon exercise of outstanding Rights have been
waived and that such transaction shall not result in a default by the
Principal Party under this Agreement, and further providing that, as soon as
practicable after the date of any consolidation, merger or sale or transfer of
assets or earning power referred to in Section 13(a) hereof, the Principal
Party will:
(i) prepare and file a registration statement under the
Securities Act of 1933, as amended (the "Securities Act"), with respect to the
Rights and the securities purchasable upon exercise of the Rights on an
appropriate form, use its best efforts to cause such registration statement to
become effective as soon as practicable after such filing and use its best
efforts to cause such registration statement to remain effective (with a
prospectus at all times meeting the requirements of the Securities Act) until
the date of expiration of the Rights, and similarly comply with applicable
state securities laws;
(ii) use its best efforts to list (or continue the listing of)
the Rights and the securities purchasable upon exercise of the Rights on a
national securities exchange or to meet the eligibility requirements for
quotation on NASDAQ; and
(iii) deliver to holders of the Rights historical financial
statements for the Principal Party which comply in all respects with the
requirements for registration on Form 10 (or any successor form) under the
Exchange Act.
If any of the transactions described in Section 13(a) hereof shall occur at
any time after the occurrence of a transaction described in Section 11(a)(ii)
hereof, the Rights which have not theretofore been exercised shall, subject to
the provisions of Section 7(e) hereof, thereafter be exercisable in the manner
described in Section 13(a) (without taking into account any prior adjustment
required by Section 11(a)(ii)).
Section 14. Fractional Rights and Fractional Shares
(a) The Company shall not be required to issue fractions of Rights or
to distribute Right Certificates which evidence fractional Rights (i.e.,
Rights to acquire less than one eight-hundredth of a share of Preferred Stock,
as such figure may be adjusted as provided in this Agreement), unless such
fractional Rights result from a transaction referred to in Section 11(a)(i)
hereof. If the Company shall determine not to issue such fractional Rights,
then, in lieu of such fractional Rights, there shall be paid to the holders of
record of the Right Certificates with regard to which such fractional Rights
would otherwise be issuable, an amount in cash equal to the same fraction of
the Fair Market Value of a whole Right.
(b) The Company shall not be required to issue fractions of
shares of Preferred Stock upon exercise of the Rights or to distribute
certificates which evidence fractional shares. In lieu of issuing fractions of
shares of Preferred Stock, the Company may, at its election, deposit the
number of whole shares of Preferred Stock which such fractional shares would
aggregate (rounded to the lowest near whole number) with a depositary selected
by it pursuant to an appropriate agreement between the Company and such
depositary and cause such depositary to issue depositary receipts representing
interests in the shares of Preferred Stock so deposited. If the Company does
not cause depositary receipts to be issued in lieu of fractional shares of
Preferred Stock, or if depositary receipts issued to one or more holders do
not fully represent an interest in the fraction of share that such a holder
would have otherwise been entitled to, there shall be paid to the holders of
record of Right Certificates at the time such Right Certificates are exercised
as herein provided, an amount in cash equal to the product of (i)(A) the
fraction of a share of Preferred Stock which each such holder would otherwise
have been entitled to upon the exercise of his Rights (if no depository
receipts are issued) or (B), if depository receipts are issued, the fraction,
if any, resulting from the difference between the fraction in clause A and the
fraction of a share represented by the depository receipts issued to such
holder and (ii) the Fair Market Value of a share of Preferred Stock.
(c) Each holder of a Right, by the acceptance thereof expressly waives
any right to receive any fractional Right or any fractional shares upon
exercise of a Right.
Section 15. Rights of Action
All rights of action in respect of this Agreement, except the rights of action
given to the Rights Agent in Section 18 hereof, are vested in the respective
registered holders of the Right Certificates (and, prior to the Distribution
Date, the holders of record of the Common Stock); and any holder of record of
any Right Certificate (or, prior to the Distribution Date, of the Common
Stock), without the consent of the Rights Agent or of the holder of any other
Right Certificate (or, prior to the Distribution Date, of the Common Stock),
may, in his own behalf and for his own benefit, enforce, and may institute and
maintain any suit, action or proceeding against the Company to enforce, or
otherwise act in respect of, his right to exercise the Rights evidenced by
such Right Certificate in the manner provided in such Right Certificate and in
this Agreement. Without limiting the foregoing or any remedies available to
the holders of Rights, it is specifically acknowledged that the holders of
Rights would not have an adequate remedy at law for any breach of this
Agreement and will 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 Right Holders
Each 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 shall be evidenced
(subject to the provisions of Section 3(b) hereof) by the certificates for
Common Stock registered in the name of the holders of the Common Stock (which
certificates for Common Stock shall also constitute certificates for Rights)
and not by separate Right Certificates, and each Right shall be transferable
only simultaneously and together with the transfer of shares of Common Stock;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the office of the Rights Agent designated for such purpose, duly endorsed or
accompanied by a proper instrument of transfer; and
(c) the Company and the Rights Agent may deem and treat the
Person in whose name the Right Certificate (or, prior to the Distribution
Date, the associated Common Stock certificate) is registered as the absolute
owner thereof and of the Rights evidenced thereby (notwithstanding any
notations of ownership or writing on the Right Certificates or the associated
Common Stock certificate made by anyone to other than the Company or the
Rights Agent) for all purposes whatsoever, and neither the Company nor the
Rights Agent shall be affected by any notice to the contrary.
Section 17. Right Certificate Holder Not Deemed a Stockholder
No holder, as such, of any Right Certificate shall be entitled to vote,
receive dividends or be deemed for any purpose the holder of Preferred Stock
or any other securities which may at any time be issuable on the exercise of
the Rights represented thereby, nor shall anything contained herein or in any
Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a stockholder of the Company or 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 Section 24 hereof), or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by such Right Certificate shall have been exercised in accordance
with the provisions hereof.
Section 18. Concerning the Rights Agent
(a) The Company agrees to pay to the Rights Agent reasonable
compensation for 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 gross negligence, bad faith or
willful misconduct on the part of the Rights Agent, for anything done or
omitted to be done by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the cost and expenses of defending
against any claim of liability relating to the Rights or this Agreement.
(b) The Rights Agent shall be protected against, and shall incur no
liability for or in respect of, any action taken, suffered or omitted by it in
connection with its administration of this Agreement in reliance upon any
Right Certificate or certificate for Preferred 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 document or paper believed by it to be genuine and to be
signed, executed and, where necessary, verified or acknowledged, by the proper
person or persons.
Section 19. Merger or Consolidation of, or Change in Name of, the Rights
Agent.
(a) Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the corporate trust or stock transfer business of the Rights
Agent or any successor Rights Agent, shall be the successor to the Rights
Agent under this Agreement without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided that such
corporation would be eligible for appointment as a successor Rights Agent
under the provisions of Section 21 hereof. In case at the time such successor
Rights Agent shall succeed to the agency created by this Agreement any of the
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 Right Certificates so countersigned; and in case
at that time any of the Right Certificates shall not have been countersigned,
any successor Rights Agent may countersign such Right Certificates either in
the name of the predecessor Rights Agent or in the name of the successor
Rights Agent; and in all such cases such Right Certificates shall have the
full force provided in the Right Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent shall be changed
and at such time any of the Right Certificates shall have been countersigned
but not delivered, the Rights Agent may adopt the countersignature under its
prior name and deliver Right Certificates so countersigned; in case at that
time any of the Right Certificates shall not have been countersigned, the
Rights Agent may countersign such Right Certificates either in its prior name
or in its changed name; in all such cases such Right Certificates shall have
the full force provided in the Right Certificates and in this Agreement.
Section 20. Duties of Rights Agent
The Rights Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions, by all of which the Company
and the holders of Right Certificates, by their acceptance thereof, shall be
bound:
(a) The Rights Agent may consult with legal counsel (who may be legal
counsel for the Company), and the opinion of such counsel shall be full and
complete authorization and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement the
Rights Agent shall deem it necessary or desirable that any fact or matter be
proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by the President or any Vice President and
by the Treasurer or any Assistant Treasurer or the Secretary or any Assistant
Secretary of the Company and delivered to the Rights Agent. Any such
certificate shall be full authorization to the Rights Agent for any action
taken or suffered in good faith by it under the provisions of this Agreement
in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its own gross
negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any of
the statements of fact or recitals contained in this Agreement or in the Right
Certificates (except its countersignature thereof) or be required to verify
the same, but all such statements and recitals are and shall be deemed to have
been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in respect
of the validity of this Agreement or the execution and delivery hereof (except
the due execution hereof by the Rights Agent) or in respect of the validity or
execution of any Right Certificate (except its countersignature thereof); nor
shall it be responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any covenant or condition
contained in this Agreement or in any Right Certificate; nor shall it be
responsible for any adjustment required under the provisions of Sections 11 or
13 hereof or responsible for the manner, method or amount of any such
adjustment or the ascertaining of the existence of facts that would require
any such adjustment (except with respect to the exercise of Rights evidenced
by Right Certificates after receipt of a certificate describing any such
adjustment); nor shall it by any act hereunder be deemed to make any represen-
tation or warranty as to the authorization or reservation of any shares of
Preferred Stock to be issued pursuant to this Agreement or any Right
Certificate or as to whether any shares of Preferred Stock will, when issued,
be validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all
such further and other acts, instruments and assurances as may reasonably be
required by the Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from the
Chairman of the Board of Directors, the President, any Vice President, the
Secretary, any Assistant Secretary, the Treasurer, or any Assistant Treasurer
of the Company, and to apply to such officers for advice or instructions in
connection with its duties. The Rights Agent 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. The Rights Agent may apply to the Company
for written instructions on a particular matter or matters by serving written
notice of its request to the Company as provided in Section 25. Any such
application by the Rights Agent for written instructions may, at the option of
the Rights Agent, set forth in writing any action proposed to be taken or
omitted by the Rights Agent with respect to its duties or obligations under
this Agreement and the date on and/or after which such action shall be taken
or omitted. Such date shall not be less than three business days after the
date the Company receives such original signed application of the Rights Agent
in hand, unless one of the above-enumerated officers shall have consented in
writing to an earlier date. The Rights Agent shall not be liable for any
action taken or omitted in accordance with the proposal included in any such
application on or after the date specified therein unless, prior to taking or
omitting any such action, the Rights Agent has received written instructions
from the Company signed by one of the said officers in response to such
application specifying the action to be taken or omitted.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend
money to the Company or otherwise act as fully and freely as though it were
not the Rights Agent under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or for any
other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself or by
or through its attorneys or agents, and the Rights Agent shall not be
answerable or accountable for any act, default, neglect or misconduct of any
such attorneys or agents or for any loss to the Company resulting from any
such act, default, neglect or misconduct, provided reasonable care was
exercised in the selection and continued employment thereof.
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 and the Preferred
Stock by registered or certified mail. The Company may remove the Rights Agent
or any successor Rights Agent (with or without cause) upon 30 days' notice in
writing, mailed to the Rights Agent or successor Rights Agent, as the case may
be, and to the Company, as transfer agent of the Common Stock, (or such other
transfer agent or agents, if applicable) and the Preferred Stock by registered
or certified mail. If the Rights Agent shall resign or be removed or shall
otherwise become incapable of acting, the Company shall appoint a successor to
the Rights Agent. Notwithstanding the foregoing provisions of this Section 21,
in no event shall the resignation or removal of a Rights Agent be effective
until a successor Rights Agent shall have been appointed and have accepted
such appointment. If the 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 the holder of a Right Certificate (who shall, with such notice,
submit his Right Certificate for inspection by the Company), then the
incumbent Rights Agent or the holder of record of any Right Certificate may
apply to any court of competent jurisdiction for the appointment of a new
Rights Agent. Any successor Rights Agent, whether appointed by the Company or
by such a court, shall be a corporation organized and doing business under the
laws of the United States or of any state thereof, in good standing, having
its office in the State of New York, which is authorized under such laws to
exercise corporate trust or stock transfer powers and is subject to
supervision or examination in the conduct of its corporate trust or stock
transfer business by federal or state authorities and which has at the time of
its appointment as Rights Agent a combined capital and surplus of at least
$50,000,000. After appointment, the successor Rights Agent shall be vested
with the same powers, rights, duties and responsibilities as if it had been
originally named as Rights Agent without further act or deed, but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver
any further assurance, conveyance, act or deed necessary for the purpose. Not
later than the effective date of any such appointment, the Company shall file
notice thereof in writing with the predecessor Rights Agent and each transfer
agent of the Common Stock and Preferred Stock, and mail a notice thereof in
writing by mail to the registered holders of the Right Certificates. Failure
to give any notice provided for in this Section, however, or any defect
therein, shall not affect the legality or validity of the resignation or
removal of the Rights Agent or the appointment of the successor Rights Agent,
as the case may be. Notwithstanding the foregoing provisions, in the event of
resignation, removal or incapacity of the Rights Agent, the Company shall have
the authority to act as the Rights Agent until a successor Rights Agent shall
have assumed the duties of the Rights Agent hereunder.
Section 22. Issuance of New Right Certificates
Notwithstanding any of the provisions of this Agreement or of the Rights to
the contrary, the Company may, at its option, issue new Right Certificates
evidencing Rights in such form as may be approved by its Board of Directors to
reflect an adjustment or change in the Exercise Price per share and the number
or kind or class of shares of stock or other securities or property
purchasable under the Right Certificates made in accordance with the
provisions of this Agreement.
Section 23. Redemption
(a) The Board of Directors may determine, at its option, to redeem all
but not less than all the then outstanding Rights, at any time prior to the
close of business on the earlier of (i) the tenth day following the Stock
Acquisition Date (or such later date as of the Board of Directors may
determine) or (ii) the Final Expiration Date, at a redemption price of $.01
per Right, payable in cash, securities of the Company or other property as
determined by the Board of Directors subject to adjustments as provided in
subsection (c) below (the "Redemption Price"). Notwithstanding anything
contained in this Agreement to the contrary, the Rights shall not be
exercisable pursuant to Section 11(a)(ii) prior to the expiration of the
Company's right of redemption hereunder.
(b) At the time designated by the action of the Board of Directors of
the Company pursuant to the preceding subsection ordering the redemption of
the Rights, and without any further action and without any notice, the right
to exercise the Rights will terminate and the only right thereafter of the
holders of Rights shall be to receive or collect the Redemption Price. Except
as otherwise provided in this Section, within 10 days after the effective time
of the action of the Board of Directors ordering the redemption of the Rights,
the Company shall give notice of such redemption to the holders of the then
outstanding Rights by providing such notice to such holders at their last
addresses as they appear upon the registry books of the Rights Agent or, prior
to the Distribution Date, on the registry books of the transfer agent for the
Common Stock. Any notice which is provided in the manner herein provided shall
be deemed given, whether or not the holder receives the notice. Each notice of
redemption will state the method by which the payment of the Redemption Price
will be made, which may be by such means and at such time as the Board of
Directors determines to be appropriate at the time, considering, among other
things, the aggregate amount to be paid to the respective holders of Rights.
(c) If the Company shall at any time after the date of this Agreement
(A) pay any dividend on Common Stock in shares of Common Stock, (B) subdivide
or split the outstanding shares of Common Stock into a greater number of
shares or (C) combine or consolidate the outstanding shares of Common Stock
into a smaller number of shares or effect a reverse split of the outstanding
shares of Common Stock, then and in each such event the Redemption Price shall
be adjusted so that Redemption Price after such event shall equal the
Redemption Price immediately prior to such event multiplied by a fraction the
denominator of which is the number of shares of Common Stock outstanding
immediately after such event and the numerator of which is the number of
shares of Common Stock outstanding immediately prior to such event. In each
case, however, such adjustment to the Redemption Price shall be made only if
the amount of the Redemption Price shall be reduced or increased by $.01 per
Right.
Section 24. Notice of Proposed Actions.
(a) In case the Company, after the Distribution Date, shall propose
(i) to effect any of the transactions referred to in Section 11(a)(i) or to
pay any dividend to the holders of record of its Common Stock payable in stock
of any class or to make any other distribution to the holders of record of its
Common Stock (other than a regular periodic cash dividend at a rate not in
excess of 125% of the rate of the last cash dividend theretofore paid), or
(ii) to offer to the holders of record of its Common Stock options, warrants,
or other rights to subscribe for or to purchase shares of Common Stock
(including any security convertible into or exchangeable for Common Stock) or
shares of stock of any class or any other securities, options, warrants,
convertible or exchangeable securities or other rights, or (iii) to effect any
reclassification of its Preferred Stock or Common Stock or any
recapitalization or reorganization of the Company, or (iv) to effect any
consolidation or merger with or into, or to effect any sale or other transfer
(or to permit one or more of its Subsidiaries to effect any sale or other
transfer), in one or more transactions, of more than 50% of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to, any
other Person or Persons, or (v) to effect the liquidation, dissolution or
winding up of the Company, then, in each such case, the Company shall give to
each holder of record of a Right Certificate, in accordance with Section 25,
notice of such proposed action. Such notice shall specify the record date
for the purposes of such transaction referred to in Section 11(a)(i) or such
dividend or distribution, or the date on which such reclassification,
recapitalization, reorganization, consolidation, merger, sale or transfer of
assets, liquidation, dissolution, or winding up is to take place and the
record date for determining participation therein by the holders of record of
Common Stock or Preferred Stock, if any such date is to be fixed. Such notice
shall be so given in the case of any action covered by clause (i) or (ii)
above at least 10 days prior to the record date for determining holders of
record of the Preferred Stock for purposes of such action, and in the case of
any such other action, at least 10 days prior to the date of the taking of
such proposed action or the date or participation therein by the holders of
record of Common Stock or Preferred Stock, whichever shall be the earlier. The
failure to give notice required by this Section 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.
(b) In case any of the transactions referred to in either Section
11(a)(ii) or Section 13 of this Agreement are proposed, then, in any such
case, the Company shall give to each holder of Rights, in accordance with
Section 25 hereof, notice of the proposal of such transaction at least 10 days
prior to consummating such transaction, which notice shall specify the
proposed event and the consequences of the event to holders of Rights under
Section 11(a)(ii) or Section 13 hereof, as the case may be, and, upon
consummating such transaction, shall similarly give notice thereof to each
holder of Rights.
Section 25. Notices
(a) Notices or demands authorized by this Agreement to be given
or made by the Company or by the holder of record of any Right Certificate or
Right to or on the Rights Agent shall be sufficiently given or made if sent by
mail, postage prepaid, addressed (until another address is filed in writing
with the Company) as follows:
ChaseMellon Shareholder Services, L.L.C.
Attn: Group Vice President
450 West 33rd Street, 15th Floor
New York, NY 10001-2697
In cases of notices or demands by the Company, a FAX copy of same shall also
be sent to (212) 947-7628 (or such substitute Fax number as the Rights Agent
shall specify by notice to the Company as provided herein), provided that such
fax copy shall be a courtesy copy and not in and of itself legally sufficient
or required.
(b) Subject to the provisions of Section 21, any notice or
demand authorized by this Agreement to be given or made by the Rights Agent or
by the holder of record of any Right Certificate or Right to or on the Company
shall be sufficiently given or made if sent by mail, postage prepaid,
addressed (until another address is filed in writing with the Rights Agent) as
follows:
Pfizer Inc.
Attn.: Corporate Secretary
235 East 42nd Street
New York, New York 10017
In cases of notices or demands by the Rights Agent, a FAX copy of same shall
also be sent to (212) 573-1853, Attn: Corporate Secretary (or to such
substitute Fax number as the Company shall specify by notice to the Rights
Agent as provided herein), provided that such fax copy shall be a courtesy
copy and not in and of itself legally sufficient or required.
(c) Notices or demands authorized by this Agreement to be given
or made by the Company or the Rights Agent to the holder of record of any
Right Certificate or Right shall be sufficiently given or made if sent by
mail, postage prepaid by any class or classes of delivery deemed appropriate
by the Company, addressed to such holder at the address of such holder as
shown on the registry books of the Company, or by any other means of delivery
or notice deemed appropriate by the Company.
Section 26. Supplements and Amendments
At any time for so long as the Rights are redeemable according to the
provisions of this Agreement, the Company from time to time may, in its sole
and absolute discretion, and the Rights Agent shall if the Company so directs,
supplement or amend any provision of this Agreement without the approval of
any holder of Rights. At any time when the Rights are not then redeemable,
the Company may, and the Rights Agent shall if the Company so directs,
supplement or amend this Agreement without the approval of any holders of
Rights (i) to cure any ambiguity, (ii) to correct or supplement any provision
contained herein which may be defective or inconsistent with any other
provisions herein, (iii) to amend or supplement the provisions hereof in any
manner which the Company may deem necessary or desirable, provided that no
such amendment or supplement pursuant to this clause (iii) shall materially
adversely affect the interests of the holders of Rights (other than an
Acquiring Person or any Affiliate or Associate of an Acquiring Person) or (iv)
to extend the Final Expiration Date and make such adjustment in the Exercise
Price and other terms hereof as the Board of Directors shall determine to be
appropriate under the circumstances. Upon the delivery of a certificate from
an appropriate officer of the Company which states that the proposed
supplement or amendment is in compliance with the terms of this Section, the
Rights Agent shall execute such supplement or amendment. This Agreement also
may be amended or supplemented at any time with the approval of a majority of
the registered holders of the Right Certificates (and, prior to the
Distribution Date, the Common Stock).
Section 27. Successors.
All of 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
Nothing in this Agreement shall be construed to give to any person or
corporation other than the Company, the Rights Agent and the registered holders
of the Right Certificates (and, prior to the Distribution Date, the Common
Stock) any legal or equitable right, remedy or claim under this Agreement; but
this Agreement shall be for the sole and exclusive benefit of the Company, the
Rights Agent and the holders of record of the Right Certificates (and, prior
to the Distribution Date, the Common Stock).
Section 29. Delaware Contract
This Agreement and each Right Certificate issued hereunder shall be deemed to be
a contract made under the laws of the State of Delaware and for all purposes
shall be governed by and construed and enforced in accordance with the laws of
such state applicable to contracts to be made and performed entirely within such
state.
Section 30. Counterparts
This Agreement may be executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same instrument.
Section 31. Descriptive Headings
Descriptive headings of the several Sections of this Agreement are inserted
for convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
Section 32. Severability
If any term, provision, covenant or restriction of this Agreement is held by a
court of competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed, all as of the day and year first
above written.
PFIZER INC.
By: /s/ C.L. Clemente
_________________________
Senior Vice President and
Secretary
test: /s/ Terence J. Gallagher
_________________________________
Terence J. Gallagher
Vice President & Assistant Secretary
(seal)
[Rights Agent]
By: /s/
_________________________
Vice President
Attest: /s/
__________________________
Authorized Officer
(seal)
<PAGE>
EXHIBIT A
[Form of Right Certificate]
Certificate No. W-_________ _______Rights
NOT EXERCISABLE AFTER OCTOBER 5, 2007 OR EARLIER IF REDEEMED. THE RIGHTS ARE
SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.01 PER RIGHT
(SUBJECT TO ADJUSTMENT) ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES AS PROVIDED IN THE RIGHTS AGREEMENT, RIGHTS BENEFICIALLY
OWNED BY AN ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE THEREOF OR
SUBSEQUENT HOLDER OF SUCH RIGHTS (AS DEFINED IN THE RIGHTS AGREEMENT) MAY
BECOME NULL AND VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON. [THE
BENEFICIAL OWNER OF THE RIGHTS REPRESENTED BY THIS RIGHT CERTIFICATE IS AN
ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON.
ACCORDINGLY, THIS RIGHT CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BE
OR BECOME VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS
AGREEMENT.]<F1>
[FN]
<F1>The portion of the legend in brackets shall be inserted only if
applicable and shall replace the preceding sentence.
</FN>
Right Certificate
PFIZER 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 October 6, 1997, as amended from time to
time (the "Rights Agreement"), between Pfizer Inc., a Delaware corporation
(the "Company"), and the "Rights Agent" named therein, 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. New York time on October 5, 2007
at the office of the Rights Agent or its successor as Rights Agent designated
for such purpose, one-thousandth (1/1000) of a fully paid nonassessable share
of the Series A Junior Preferred Stock ("Preferred Stock") of the Company at
the price of $ 275.00, as the same may from time to time be adjusted in
accordance with the Rights Agreement (the "Exercise Price"), upon presentation
and surrender of this Right Certificate with the Form of Election to Exercise
duly executed.
Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Certificate may be redeemed by the Company at its option at a
redemption price of $0.01 per Right, subject to adjustment as provided in the
Rights Agreement.
As provided in the Rights Agreement, the Exercise Price and the number
of shares of Preferred Stock which may be purchased upon the exercise of the
Rights evidenced by this Right Certificate are subject to modification and
adjustment upon the happening of certain events and, upon the happening of
certain events or determinations by the Company, securities other than shares
of Preferred Stock or other property may be acquired upon exercise of or in
exchange for the Rights evidenced by this Right Certificate, all as provided
by the Rights Agreement.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
incorporated herein by reference and made a part hereof and to which Rights
Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities of the Rights Agent,
the Company and the holders of record of the Right Certificates. Copies of
the Rights Agreement are on file with and may be requested in writing from the
Corporate Secretary at the principal executive office of the Company.
This Right Certificate, with or without other Right Certificates, upon
surrender at the office of the Rights Agent designated for such purpose, may
be exchanged for another Right Certificate or Right Certificates of like tenor
and data evidencing Rights entitling the holder of record to purchase a like
aggregate number of shares of Preferred Stock as the Rights evidenced by the
Right Certificate or Right Certificates surrendered shall have entitled such
holder to purchase. If this Right Certificate shall be exercised in part, the
holder shall be entitled to receive upon surrender hereof, another Right
Certificate or Right Certificates for the number of whole Rights not
exercised.
No fractional shares of Preferred Stock are required to be issued upon the
exercise of any Right or Rights evidenced hereby, and in lieu thereof the
Company may cause depository receipts to be issued and/or a cash payment to be
made, as provided in the Rights Agreement.
No holder of this Right Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of Preferred Stock
or of any other securities of the Company which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any of the
rights of a stockholder of the Company or 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, or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by this Right Certificate shall have been exercised as provided in
the Rights Agreement.
This Right 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 ____________________, ______
ATTEST: PFIZER INC.
______________________________________ By________________________________
Secretary Title:
Countersigned:
["RIGHTS AGENT"]
By:________________________________
Authorized Signature
[Back of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to transfer the
Right Certificate)
FOR VALUE RECEIVED_____________________________________________
hereby sells, assigns and transfers unto
______________________________________________________________________________
(Please print name and address of transferee)
_______________________________________________________________________________
Rights evidenced by this Right Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and
appoint_________________________________________________________________
Attorney to transfer the within Right Certificate on the books of the within-
named Company, with full power of substitution.
Dated: ___________________ __________ __________________________________
Signature
Signature Guaranteed:______________________________
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes that:
(1) this Right Certificate ____ is _____ is not being sold, assigned or
transferred by or on behalf of a Person who is or was an Acquiring Person or an
Associate or an Affiliate thereof (as such terms are defined in the Amended and
Restated Rights Agreement dated as of October 5, 1997 to which Pfizer Inc. is a
party; and
(2) after due inquiry and to the best knowledge of the undersigned, it
____ did ____ did not acquire the Rights evidenced by this Right Certificate
from any Person who is, was or subsequently became an Acquiring Person or
an Affiliate or Associate thereof (as such terms are defined in said
Rights Agreement.
Dated: ___________________ __________ __________________________________
Signature
Signature
NOTICE
The signatures to the foregoing Assignment and certificate must correspond
to the name as written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.
<PAGE>
FORM OF ELECTION TO EXERCISE
(To be executed if registered holder desires to exercise the Right Certificate).
To________________________________:
The undersigned hereby irrevocably elects to exercise__________________
Rights represented by this Right Certificate to purchase the shares of Preferred
Stock issuable upon the exercise of such Rights and requests that certificates
for such shares(s) be issued in the name:
Please insert social security or other identifying number:____________________
______________________________________________________________________________
(Please print name and address)
If such number of Rights shall not be all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:
Please insert social security or other identifying number:__________________
____________________________________________________________________________
(Please print name and address)
Dated:____________,______ Signature:_____________________________________
(Signature must conform in all respects to name of
holder as specified on the face of this Right
Certificate)
Signature Guaranteed:__________________________
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes that:
(1) this Right Certificate is ____ is not _____being sold, assigned or
transferred by or on behalf of a Person who is or was an Acquiring Person or an
Associate or an Affiliate thereof (as such terms are defined in the Amended and
Restated Rights Agreement dated as of October 5, 1997 to which Pfizer Inc. is a
party); and
(2) after due inquiry and to the best knowledge of the undersigned,
it ____did ____ did not acquire the Rights evidenced by this Rights Certificate
from any Person who is, was or subsequently became an Acquiring Person or an
Affiliate or Associate thereof (as such terms are defined in said Rights
Agreement).
Dated:____________,______ ___________________________________________
Signature
