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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-A/A
AMENDMENT TO APPLICATION OR REPORT
Filed pursuant to Section 12, 13 or 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
CHRYSLER CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
AMENDMENT NO. 3 TO FORM 8-A
The undesigned registrant hereby amends the following items,
financial statements, exhibits or other portions of its Application for
Registration on Form 8-A dated February 10, 1988 for its Rights to Purchase
Junior Participating Cumulative Preferred Stock, par value $1.00 per share, as
set forth in the pages attached hereto:
Item 1. Description of Registrant's Securities to be
Registered
Item 2. Exhibits.
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Item 1. Description of Registrant's Securities to be Registered.
Item 1 of the Form 8-A dated February 10, 1988, as amended by
the Form 8 dated September 8, 1989 and Form 8 dated December 14, 1990 (as so
amended, the "Form 8-A"), filed by Chrysler Corporation (the "Company") is
hereby amended by adding the following:
On December 1, 1994, the Company further amended the Rights
Agreement by entering into Amendment No. 1, dated as of December 1, 1994 (the
"Amendment"), to the Amended and Restated Rights Agreement with First Chicago
Trust Company of New York. Capitalized terms used and not otherwise defined
herein have the meanings ascribed to them in the Rights Agreement and
Amendment.
The Rights Agreement has been amended to increase from 10% to
15% the threshold of beneficial ownership at which a Person is deemed to be an
Acquiring Person.
In addition, the Rights Agreement has been amended to modify the
definition of "Acquiring Person" to (i) exclude from the definition of
"Acquiring Person" a person determined by the Board of Directors to have
inadvertently become the Beneficial Owner of 15% or more of the Company's
Common Stock if that person promptly disposes of a sufficient number of shares
in order to reduce the number of shares Beneficially Owned below the 15%
threshold and (ii)
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provide that if a person is a director or officer of the Company, the stock
Beneficially Owned by other directors or officers will not, solely for that
reason, be attributed to that person.
The Rights Agreement was also amended to (i) eliminate the
ability of the Company to redeem the Rights during the ten business day period
following the day on which the Company is notified that a person has become an
Acquiring Person and (ii) eliminate the requirement that only "Continuing
Directors" can redeem the Rights following a change in a majority of the Board
of Directors.
The Rights Agreement was also amended to permit the Company,
in connection with an exchange for Rights, at its option, to substitute for
each share of Common Stock exchangeable for Rights, a fractional share of
Preferred Stock (or other series of substantially similar preferred stock of
the Company) having the same voting rights as one share of Common Stock.
The Rights Agreement was further amended to limit the period
during which the Board of Directors may amend in any respect whatsoever any
provision of the Rights (other than those relating to the principal economic
terms of the Rights) to the period prior to the time the Company is notified
that a person has become an Acquiring Person.
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A copy of the Amendment has been attached as an exhibit hereto
and is incorporated herein by reference. The foregoing description of the
amendments to the Amended and Restated Rights Agreement does not purport to be
complete and is qualified in its entirety by reference to the Amendment.
Item 2. Exhibits.
Item 2 of the Form 8-A is hereby amended by adding the
following exhibit attached hereto:
4. Amendment No. 1, dated as of December 1, 1994, to
Amended and Restated Rights Agreement, dated as of
December 14, 1990, between the Company and First
Chicago Trust Company of New York.
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this amendment to be signed on its behalf
by the undesigned, thereunto duly authorized.
CHRYSLER CORPORATION
-----------------------------
(Registrant)
By: /s/ William J. O'Brien
-----------------------
William J. O'Brien
Vice President, General
Counsel and Secretary
Dated: December 1, 1994
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Exhibit Index
Exhibit No. Description
- ----------- -----------
4 Amendment No. 1, dated as of December 1, 1994, to Amended and
Restated Rights Agreement, dated as of December 14, 1990,
between the Company and First Chicago Trust Company of New
York.
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EXHIBIT 4
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AMENDED AND RESTATED RIGHTS AGREEMENT
AMENDMENT NO. 1
Amendment No. 1, dated as of December 1, 1994 (the
"Amendment"), to the Rights Agreement, dated as of February 4, 1988, amended
and restated as of December 14, 1990 (the "Rights Agreement"), between Chrysler
Corporation, a Delaware corporation (the "Company"), and First Chicago Trust
Company of New York (formerly known as Morgan Shareholder Services Trust
Company), a New York corporation (the "Rights Agent").
W I T N E S S E T H :
WHEREAS, the Company and the Rights Agent entered into the
Rights Agreement; and
WHEREAS, on December 1, 1994, the Board of Directors of the
Company, in accordance with Section 26 of the Rights Agreement, determined it
desirable and in the best interests of the Company and its stockholders to
supplement and amend certain provisions of the Rights Agreement.
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NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereby agree as follows:
Section 1. Amendment to Section 1. The definition of
"Acquiring Person" in Section 1(a) of the Rights Agreement is amended to read
in its entirety as follows:
"(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 Common
Stock of the Company then outstanding, but shall not include any
employee benefit plan of the Company or any Subsidiary of the Company
or any Person organized, appointed or established by the Company or
such Subsidiary for or pursuant to the terms of any such employee
benefit plan. Notwithstanding the foregoing:
(i) no Person shall become an `Acquiring Person'
as the result of an acquisition of shares of Common Stock by
the Company which, by reducing the number of shares of Common
Stock outstanding, increases the proportionate number of
shares Beneficially Owned by such Person to 15% or more of the
shares of Common Stock of the Company then outstanding,
provided, however, that if a Person shall become the
Beneficial Owner of 15% or more of the shares of Common Stock
of the Company by reason of share purchases by the Company and
shall, after such share purchases by the Company, at a time
when such Person Beneficially Owns 15% or more of the Common
Stock, become the Beneficial Owner of any additional shares of
Common Stock of the Company, then such Person shall be deemed
to be an `Acquiring Person';
(ii) if the Board of Directors of the Company
determines in good faith that a Person who would otherwise be
an `Acquiring Person' has
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become such inadvertently (including, without limitation, because (A)
such Person was unaware that he or it Beneficially Owned a percentage
of Common Stock that would otherwise cause such Person to be an
`Acquiring Person' or (B) such Person was aware of the extent of his
or its Beneficial Ownership but had no actual knowledge of the
consequences of such Beneficial Ownership under this Agreement) and
without any intention of changing or influencing control of the
Company, and if such Person, as promptly as practicable after being
advised of such determination, divests himself or itself of Beneficial
Ownership of a sufficient number of shares of Common Stock so that
such Person would no longer be an `Acquiring Person', then such Person
shall not be deemed to be or to have become an `Acquiring Person' for
any purposes of this Agreement; and
(iii) no Person shall become an `Acquiring Person'
by virtue of ownership of Common Stock of the Company by any
Affiliate and/or Associate of such Person, which Affiliate and/or
Associate is deemed to be an Affiliate and/or Associate of such
Person solely by reason of such Affiliate and/or Associate being a
director or officer of the Company."
Section 2. Amendments to Section 3. (a) The first sentence
of section 3(a) of the Rights Agreement is amended by deleting the number "10%"
and inserting in lieu thereof the number "15%".
(b) The second sentence of section 3(b) of the Rights
Agreement is amended by deleting the date "December 14, 1990" and inserting in
lieu thereof the date "December 1, 1994".
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(c) The legend set forth in section 3(c) of the Rights
Agreement is amended by adding the phrase "and further amended as of December
1, 1994, and as it may be amended from time to time" immediately after the
phrase "December 14, 1990".
Section 3. Amendment to Section 13(a). Clause (y) of the
first sentence of section 13(a) of the Rights Agreement is amended by adding
the phrase "the Company or" immediately after the phrase "changed into or
exchanged for stock or other securities of".
Section 4. Amendment to Section 23. Section 23 of the Rights
Agreement is amended to read in its entirety as follows:
"Section 23. Redemption. (a) The Company may, by resolution
of its Board of Directors, at its option, at any time prior to the earlier of
(x) the Stock Acquisition Time or (y) the Close of Business on the Final
Expiration Date, redeem all but not less than all of the then outstanding
Rights at a redemption price of $.05 per Right (payable in cash, shares of
Common Stock (based on the Current Market Price of the Common Stock at the time
of redemption) or any other form of consideration deemed appropriate by the
Board of Directors of the Company), appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the date hereof
(such redemption price being hereinafter referred to as the 'Redemption
Price').
(b) Immediately upon the action of the Board of Directors of
the Company ordering the redemption of the Rights (or at such time subsequent
to such action as the
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Board of Directors may determine), and without any further action and without
any notice, the right to exercise the Rights will terminate and the only right
thereafter of the holders of Rights shall be to receive the Redemption Price.
Within 10 days after 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 mailing such notice to all such
holders at their last addresses as they appear upon the registry books of the
Rights Agent or, prior to the Distribution Date, on the registry books of the
transfer agent for the Common Stock of the Company. Any notice which is mailed
in the manner herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of redemption will state the method by
which the payment of the Redemption Price will be made. Neither the Company
nor any of its Affiliates or Associates may redeem, acquire or purchase any
Rights at any time in any manner other than that specifically set forth in this
Section 23 or Section 23A and other than in connection with the repurchase of
Common Stock of the Company prior to the Distribution Date."
Section 5. Amendment to Section 23A. Section 23A of the
Rights Agreement is amended to reletter paragraphs (c) and (d) thereof as
paragraphs (d) and (e), respectively, and to add a new paragraph (c) and amend
former paragraph (c) to read in its entirety as follows:
"(c) In any exchange pursuant to this
Section 23A, the Company, at its option, may substitute shares
of Preferred Stock (or any other series of preferred stock of
the Company containing terms substantially similar to the
terms of the Preferred Stock) for some or all of the shares of
Common Stock exchangeable for Rights, at the initial rate of
one one-hundredth of a share of Preferred Stock (or of such
other series of preferred stock of the Company) for each share
of Common Stock, as appropriately adjusted to reflect
adjustments in the voting rights of the Preferred Stock
pursuant to the terms thereof, so that the fraction of a share
of Preferred Stock (or of such other series of preferred stock
of the
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Company) delivered in lieu of each share of Common Stock
shall have the same voting rights as one share of Common Stock.
(d) In the event that there shall not be
sufficient shares of Common Stock or Preferred Stock (or any
other series of preferred stock of the Company containing
terms substantially similar to the terms of the Preferred
Stock) issued but not outstanding or authorized but unissued
to permit any exchange of Rights as contemplated in accordance
with this Section 23A, the Company shall take all such action
as may be necessary to authorize additional shares of Common
Stock or Preferred Stock (or such other series of preferred
stock of the Company) for issuance upon exchange of the
Rights."
Section 6. Amendment to Section 26. Section 26 of the Rights
Agreement is amended to read in its entirety as follows:
"Section 26. Supplements and Amendments. Prior to the Stock
Acquisition Time and subject to the penultimate sentence of this Section 26,
the Company may, by resolution of its Board of Directors, and the Rights Agent
shall, if the Company so directs, supplement or amend any provision of this
Agreement in any respect whatsoever (including, without limitation, any
extension of the period in which the Rights may be redeemed) without the
approval of any holders of certificates representing shares of Common Stock of
the Company. From and after the Stock Acquisition Time and subject to the
penultimate sentence of this Section 26, without the approval of any holders of
certificates representing shares of Common Stock of the Company or of Right
Certificates, the Company may, by resolution of its Board of Directors (which
resolution shall be effective only with the concurrence of a majority of the
Continuing Directors, and only if the Continuing Directors constitute a
majority of the number of directors then in office), and the Rights Agent
shall, if the Company so directs, supplement or amend this Agreement in order
(i) to cure any ambiguity, (ii) to correct or supplement any provision
contained herein which may be defective or inconsistent with any other
provisions herein, (iii) to shorten or lengthen any time period hereunder or
(iv) to change or supplement or make any
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other provisions in any manner which the Company may deem necessary or
desirable, which shall not adversely affect the interests of, or diminish
substantially or eliminate the benefits intended to be afforded by the Rights
to, the holders of Right Certificates (other than an Acquiring Person or an
Affiliate or Associate of any such Person); provided, however, that this
Agreement may not be supplemented or amended to lengthen, pursuant to clause
(iii) of this sentence, (A) a time period relating to when the Rights may be
redeemed or to modify the ability (or inability) of the Board of Directors of
the Company to redeem the Rights, in either case at such time as the Rights are
not then redeemable or (B) any other time period unless such lengthening is for
the purpose of protecting, enhancing or clarifying the rights of or the
benefits to the holders of Rights (other than an Acquiring Person or an
Affiliate or Associate of any such Person). 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 26, the
Rights Agent shall execute such supplement or amendment. Notwithstanding
anything contained in this Agreement to the contrary, no supplement or
amendment shall be made which changes the Redemption Price, the Final
Expiration Date, the Purchase Price or the number of one one-hundredths of a
share of Preferred Stock for which a Right is exercisable. Prior to the Stock
Acquisition Time, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Common Stock."
Section 7. Amendment to Right Certificate. The form of Right
Certificate set forth in Exhibit B attached to the Rights Agreement is hereby
amended to read in its entirety as set forth in Exhibit B attached hereto.
Section 8. Amendment to Summary of Rights. The form of
Summary of Rights set forth in Exhibit C attached to the Rights Agreement is
hereby amended to read in its entirety as set forth in Exhibit C attached
hereto.
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Section 9. Rights Agreement as Amended. The term "Agreement"
as used in the Rights Agreement shall be deemed to refer to the Rights
Agreement as amended hereby. This Amendment shall be effective as of the date
hereof and, except as set forth herein, the Rights Agreement shall remain in
full force and effect and be otherwise unaffected hereby.
Section 10. Counterparts. This Amendment may be executed in
any number of counterparts and each of such counterparts shall for all purposes
be deemed to be an
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original, and all such counterparts shall together constitute but one and the
same instrument.
IN WITNESS WHEREOF, the parties have caused this Amendment to
be duly executed and their respective corporate seals to be hereunto affixed
and attested, all as of the day and year first above written.
Attest: CHRYSLER CORPORATION
By: /s/ Holly E. Leese By: /s/ William J. O'Brien
---------------------- ------------------------
Title: Assistant Title: Vice President,
Secretary General Counsel
and Secretary
Attest: FIRST CHICAGO TRUST
COMPANY OF NEW YORK
By: /s/ Richard T. Wiencek By: /s/ Michael R. Phalen
----------------------- ----------------------
Title: Assistant Vice Title: Vice President
President
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EXHIBIT B
[Form of Right Certificate]
Certificate No. R- ______ Rights
NOT EXERCISABLE AFTER FEBRUARY 22, 1998 OR EARLIER IF THE BOARD OF DIRECTORS
ORDERS THE REDEMPTION OR EXCHANGE OF THE RIGHTS. THE RIGHTS ARE SUBJECT TO
REDEMPTION AT $.05 PER RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE
RIGHTS AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN
ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE
DEFINED IN THE RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY
BECOME NULL AND VOID. THE RIGHTS SHALL NOT BE EXERCISABLE, AND SHALL BE VOID
SO LONG AS HELD, BY A HOLDER IN ANY JURISDICTION WHERE THE REQUISITE
QUALIFICATION TO THE ISSUANCE TO SUCH HOLDER, OR THE EXERCISE BY SUCH HOLDER,
OF THE RIGHTS IN SUCH JURISDICTION SHALL NOT HAVE BEEN OBTAINED OR BE
OBTAINABLE. [THE RIGHTS REPRESENTED BY THIS CERTIFICATE ARE OR WERE
BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN
AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT). ACCORDINGLY, THIS CERTIFICATE AND THE RIGHTS REPRESENTED
HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e)
OF SUCH AGREEMENT.](1)
Rights Certificate
CHRYSLER CORPORATION
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 February 4, 1988, amended and restated as of
December 14, 1990, and further amended by Amendment No. 1, dated as of December
1, 1994 (the Rights
- --------------------
(1) The portion of the legend in brackets shall be inserted only if
applicable and shall replace the preceding sentence.
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Agreement as so amended is hereinafter referred to as the "Rights
Agreement"), between Chrysler Corporation, a Delaware corporation (the
"Company"), and First Chicago Trust Company of New York (formerly known as
Morgan Shareholder Services Trust Company), a New York corporation (the "Rights
Agent"), to purchase from the Company at any time after the Distribution Date
(as such term is defined in the Rights Agreement) and prior to 5:00 P.M. (New
York City time) on February 22, 1998, at the principal office of the Rights
Agent, or its successors as Rights Agent, one one-hundredth of a fully paid
nonassessable share of Junior Participating Cumulative Preferred Stock, par
value $1.00 per share (the "Preferred Stock"), of the Company, at a purchase
price of $120 per one one-hundredth of a share of Preferred Stock (the
"Purchase Price"), upon presentation and surrender of this Right Certificate
with the Form of Election to Purchase and the Certificate contained therein
duly executed. The number of Rights evidenced by this Right Certificate (and
the number of one one-hundredth of a share of Preferred Stock which may be
purchased upon exercise thereof) set forth above, and the Purchase Price per
one one-hundredth of a share of Preferred Stock set forth above, are the number
and Purchase Price as of February 22, 1988,
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based on the shares of Preferred Stock as constituted at such date.
From and after the first occurrence of a Section 11(a)(ii)
Event (as defined in the Rights Agreement), if the Rights evidenced by this
Right Certificate are beneficially owned by (i) an Acquiring Person or an
Affiliate or Associate thereof (as such terms are defined in the Rights
Agreement), (ii) a transferee of any such Acquiring Person (or of any Associate
or Affiliate thereof) who becomes a transferee after such Acquiring Person (or
any Associate or Affiliate thereof) becomes such or (iii) under certain
circumstances specified in the Rights Agreement, a transferee of such Acquiring
Person (or of any Associate or Affiliate thereof) who becomes a transferee
prior to or concurrently with such Acquiring Person becoming such, such Rights
shall become null and void and no holder hereof shall have any right with
respect to such Rights from and after the occurrence of such Section 11(a)(ii)
Event.
The Rights evidenced by this Right Certificate shall not be
exercisable, and shall be void so long as held, by a holder in any jurisdiction
where the requisite qualification to the issuance to such holder, or the
exercise by such holder, of the Rights in such jurisdiction shall not have been
obtained or be obtainable.
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As provided in the Rights Agreement, the Purchase Price and
the number of one one-hundredths of a share of Preferred Stock or the number
and kind of other securities 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, including Section 11(a)(ii)
Events and Section 13 Events (as defined in the Rights Agreement).
This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, as it may be amended from
time to time, which terms, provisions and conditions are hereby incorporated
herein by reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights, limitations of
rights, obligations, duties and immunities hereunder of the Rights Agent, the
Company and the holders of the Right Certificates, which limitations of rights
include the temporary suspension of the exercisability of such Rights under the
specific circumstances set forth in the Rights Agreement. Copies of the Rights
Agreement are on file at the principal executive offices of the Company and the
above-mentioned office of the Rights Agent and are also available upon written
request to the Rights Agent.
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This Right Certificate, with or without other Right
Certificates, upon surrender at the principal office of the Rights Agent, may
be exchanged for another Right Certificate or Right Certificates of like tenor
and date evidencing Rights entitling the holder to purchase a like aggregate
number of one one-hundredths of a share 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.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Right Certificate may be redeemed by the Company at a
redemption price of $.05 per Right at any time prior to the earlier of (i) the
Stock Acquisition Time (as defined in the Rights Agreement) and (ii) the close
of business on the Expiration Date (as defined in the Rights Agreement).
Subject to the provisions of the Rights Agreement, the rights evidenced by this
Right Certificate may be exchanged in whole or part for shares of Common Stock
or fractional shares of Preferred Stock (or any
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other substantially similar series of preferred stock of the Company).
No fractional shares of Preferred Stock will be issued upon
the exercise of any Right or Rights evidenced hereby (other than fractions
which are integral multiples of one one-hundredth of a share of Preferred
Stock, which may, at the election of the Company, be evidenced by depositary
receipts), but in lieu thereof a cash payment will be made, as provided in the
Rights Agreement.
Other than those provisions relating to the principal economic
terms of the Rights, any of the provisions of the Rights Agreement may be
amended by the Board of Directors of the Company (following the Stock
Acquisition Time, only with the concurrence of a majority of the Continuing
Directors) in any respect whatsoever up until the Stock Acquisition Time and
thereafter in certain respects which do not adversely affect the interests of
holders of Right Certificates (other than an Acquiring Person or the Affiliates
or Associates thereof).
No holder of this Right Certificate shall be entitled to vote
or receive dividends or be deemed for any purpose the holder of shares 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 con-
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tained 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 (except as provided in the Rights Agreement), or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by this Right Certificate shall have been exercised as provided in
the Rights Agreement.
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 __________, 19__.
ATTEST: CHRYSLER CORPORATION
By
------------------------- -------------------------
Secretary Title:
Countersigned:
First Chicago Trust Company
of New York
By
-----------------------
Authorized Signature
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EXHIBIT C
CHRYSLER CORPORATION
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED STOCK
On February 4, 1988, the Board of Directors of Chrysler
Corporation (the "Company") declared a dividend distribution of one Preferred
Share Purchase Right (a "Right") for each outstanding share of Common Stock,
par value $1.00 per share, of the Company (the "Common Stock"). On September
7, 1989, December 14, 1990 and December 1, 1994, the Board of Directors amended
the terms of the Rights. The following is a summary of the terms of the
Rights, as so amended.
Each Right entitles the registered holder to purchase from the
Company one one-hundredth of a share of Junior Participating Cumulative
Preferred Stock, par value $1.00 per share, of the Company (the "Preferred
Stock") at a price of $120 per one one-hundredth of a share of Preferred Stock,
subject to adjustment (the "Purchase Price"). The description and terms of the
Rights are set forth in a Rights Agreement, amended and restated as of December
14, 1990, as amended by Amendment No. 1, dated as of December 1, 1994 (the
Rights Agreement, as so amended, is hereinafter referred to as the "Rights
Agreement"), between the Company and First Chicago Trust Company of New York
(formerly known as Morgan Shareholder Services Trust Company), as Rights Agent
(the "Rights Agent").
Initially, the Rights will be attached to all Common Stock
certificates representing shares then outstanding, and no separate certificates
representing the Rights ("Right Certificates") will be distributed. The Rights
will separate from the Common Stock and a "Distribution Date" will occur upon
the earlier to occur of (i) ten days following the time (the "Stock Acquisition
Time") of a public announcement that a person or group of affiliated or
associated persons (an "Acquiring Person") acquired, or obtained the right to
acquire, beneficial ownership of 15% or more of the outstanding Common Stock of
the Company and (ii) ten business days (or, if determined by the Board of
Directors (with the concurrence of a majority of the Continuing Directors (as
hereinafter defined)), a specified or unspecified later date) following the
commencement or announcement of an intention to make a
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tender offer or exchange offer which, if successful, would cause the bidder to
own 15% of more of the outstanding Common Stock.
The Rights Agreement provides that, until the Distribution
Date, (i) the Rights will be transferred with and only with the Common Stock,
(ii) new Common Stock certificates issued after February 22, 1988, upon
transfer or new issuance of the Common Stock, will contain a notation
incorporating the Rights Agreement by reference and (iii) the surrender for
transfer of any of the Common Stock certificates outstanding 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 Right Certificates will be mailed to holders of
record of the Common Stock as of the close of business on the Distribution Date
and such separate Right Certificates alone will evidence the Rights. Except as
otherwise determined by the Board of Directors, only shares of Common Stock
issued prior to the Distribution Date will be issued with Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on February 22, 1998, unless earlier redeemed or
exchanged by the Company as described below.
In the event that, after the Stock Acquisition Time, the
Company is acquired in a merger or other business combination transaction
(except certain transactions with a person who became an Acquiring Person as a
result of a tender offer described in the next succeeding paragraph) or 50% or
more of its assets, cash flow or earning power is sold, proper provision shall
be made so that each holder of a Right shall thereafter have the right to
receive, upon the exercise thereof at the then current exercise price of the
Right, that number of shares of common stock of the acquiring company which at
the time of such transaction would have a market value (as defined in the
Rights Agreement) of two times the Purchase Price of the Right. In the event
that, after the Stock Acquisition Time, the Company were the surviving
corporation of a merger and its Common Stock were changed or exchanged, proper
provision shall be made so that each holder of a Right will thereafter have the
right to receive upon exercise that number of shares of common stock of the
Company having a market value of two times the exercise price of the Right.
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In the event that a person or group becomes an Acquiring
Person (except pursuant to a tender offer for all outstanding Common Stock
determined to be at a fair price and otherwise in the best interests of the
Company and its stockholders by a majority of the Outside Directors), proper
provision shall be made so that each holder of a Right (other than the
Acquiring Person) will thereafter have the right to receive upon exercise that
number of shares of Common Stock (or, in certain circumstances, cash, a
reduction in the Purchase Price, Common Stock, other equity securities of the
Company, debt securities of the Company, other property or a combination
thereof) having a market value (as defined in the Rights Agreement) of two
times the Purchase Price of the Right. Notwithstanding any of the foregoing,
following the occurrence of any of the events set forth in this paragraph, all
Rights that are, or (under certain circumstances specified in the Rights
Agreement) were, beneficially owned by any Acquiring Person (or an affiliate,
associate or transferee thereof) will be null and void. A person will not be
an Acquiring Person if the Board of Directors of the Company determines that
such person or group became an Acquiring Person inadvertently and such person
or group promptly divests itself of a sufficient number of shares of Common
Stock so that such person or group is no longer an Acquiring Person.
The Purchase 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 (i) in
the event of a stock dividend on, or a subdivision, combination or
reclassification of, the Preferred Stock, (ii) upon the grant to holders of
Preferred Stock of certain rights or warrants to subscribe for Preferred Stock
or convertible securities at less than the current market price of Preferred
Stock or (iii) upon the distribution to holders of Preferred Stock of evidences
of indebtedness or assets (excluding regular periodic cash dividends or
dividends payable in Preferred Stock) or of subscription rights or warrants
(other than those referred to above). The number of Rights and number of
shares of Preferred Stock issuable upon the exercise of each Right are also
subject to adjustment in the event of a stock split, combination or stock
dividend on the Common Stock.
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an adjustment of at least
1% in such Purchase Price.
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No fractional shares of Preferred Stock will be issued (other than fractions
which are integral multiples of one one-hundredth of a share of Preferred Stock
which may, upon the election of the Company, be evidenced by depositary
receipts) and, in lieu thereof, an adjustment in cash will be made based on the
market price of the Preferred Stock on the last trading date prior to the date
of exercise.
At any time prior to the earlier of the Stock Acquisition Time
and the Expiration Date (as defined in the Rights Agreement), the Board of
Directors may redeem the Rights in whole, but not in part, at a price of $.05
per Right (the "Redemption Price"). Immediately upon the action of the Board
of Directors ordering redemption of the Rights, the Rights will terminate and
the only right of the holders of Rights will be to receive the $.05 Redemption
Price.
At any time after a person becomes an Acquiring Person and
prior to the acquisition by such Person of 50% or more of the outstanding
shares of Common Stock, the Board of Directors of the Company may exchange the
Rights (other than Rights beneficially owned by such Person which have become
void), in whole or part, at an exchange ratio of one share of Common Stock per
Right (subject to adjustment). The Company, at its option, may substitute one
one-hundredth of a share of Preferred Stock (or other series of substantially
similar preferred stock of the Company) for each share of Common Stock to be
exchanged.
Each share of Preferred Stock purchasable upon exercise of the
Rights will have a minimum preferential dividend of $10 per year, but will be
entitled to receive, in the aggregate, a dividend of 100 times the dividend
declared on the shares of Common Stock. In the event of liquidation, the
holders of the shares of Preferred Stock will be entitled to receive a minimum
liquidation payment of $100 per share, but will be entitled to receive an
aggregate liquidation payment equal to 100 times the payment made per share of
Common Stock. Each share of Preferred Stock will have one hundred votes,
voting together with the shares of Common Stock. In the event of any merger,
consolidation or other transaction in which shares of Common Stock are
exchanged, each share of Preferred Stock will be entitled to receive 100 times
the amount and type of consideration received per share of Common Stock. The
rights of the shares of Preferred Stock as to dividends and liquidation, and in
the event of mergers and consolidations, are protected by anti-dilution
provisions.
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Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, other than rights resulting
from such holder's ownership of shares of Common Stock, including, without
limitation, the right to vote or to receive dividends. While the distribution
of the Rights will not be taxable to stockholders or to the Company,
stockholders may, depending upon the circumstances, recognize taxable income in
the event that the Rights become exercisable for Common Stock (or other
consideration) of the Company or for common stock of the acquiring company as
set forth above.
Other than those provisions relating to the principal economic
terms of the Rights, any of the provisions of the Rights Agreement may be
amended by the Board of Directors prior to the Stock Acquisition Time. After
such time, the provisions of the Rights Agreement may be amended by the Board
of Directors (only with the concurrence of a majority of the Continuing
Directors) in order to cure any ambiguity, to correct or supplement defective
or inconsistent provisions, to shorten or lengthen any time period under the
Rights Agreement, to make changes which do not adversely affect the interests
of the holders of Rights (excluding the interests of any Acquiring Person) or
to shorten or lengthen any time period under the Rights Agreement; provided,
however, that no amendment to adjust the time period governing redemption shall
be made at such time as the Rights are not redeemable.
The term "Continuing Director" means any member of the Board
of Directors of the Company who was a member of the Board prior to the Stock
Acquisition Time, and any person who is subsequently elected to the Board if
such person is recommended or approved by a majority of the Continuing
Directors then on the Board of Directors, but shall not include an Acquiring
Person or an affiliate, associate, representative or nominee of an Acquiring
Person.
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an Exhibit to an Amendment on Form 8
dated December 14, 1990. A copy of Amendment No. 1 to the Rights Agreement has
been filed with the Securities and Exchange Commission as an Exhibit to an
Amendment on Form 8 dated December 1, 1994. Copies of the Rights Agreement and
Amendment No. 1 are available free of charge from the Company. This summary
description of the Rights does not purport to be complete and is qualified in
its entirety by reference to the Rights Agreement, as it may
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be amended from time to time, which is hereby incorporated herein by reference.
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