SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A/A
______________
AMENDING FORM 8-A DATED NOVEMBER 4, 1988
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
FIRSTFED FINANCIAL CORP.
______________________________________________________
(Exact name of registrant as specified in its charter)
Delaware 95-4087449
______________________________ ________________________
(State of incorporation or (I.R.S. Employer
organization) Identification No.)
401 Wilshire Boulevard
Santa Monica, CA 90401-1490
______________________________ ___________________________
Address of principal executive (Zip Code)
offices)
If this form relates to the registration of a class of
securities pursuant to Section 12(b) of the Exchange Act and is
effective pursuant to General Instruction A.(c), check the
following box. [ X ]
If this form relates to the registration of a class of
securities pursuant to Section 12(g) of the Exchange Act and is
effective pursuant to General Instruction A.(d), check the
following box. [__]
Securities Act registration statement file number to
which this form relates (if applicable): Not applicable
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange
to be so registered on which each class
is to be registered
_______________________________ __________________________
Preferred Stock Purchase Rights New York Stock Exchange
Securities to be registered pursuant to Section 12(g) of the Act:
None
______________________________________________________________
(Title of Class)
<PAGE>
AMENDMENT NO. 1
TO FORM 8-A FILED NOVEMBER 4, 1988
The undersigned registrant hereby amends Item 1 of its
Registration of Certain Classes of Securities Pursuant to Section
12(b) or (g) of the Securities Exchange Act of 1934 on Form 8-A,
filed November 4, 1988 (the "Form 8-A"), as set forth below:
Item 1 of the Form 8-A is amended by substituting
the following:
Item 1. Description of Securities to be Registered.
-------------------------------------------
On October 20, 1988 the Board of Directors of FirstFed
Financial Corp. (the "Company") declared a dividend distribution
of one right (a "Right") for each outstanding share of common
stock, $.01 par value (the "Common Stock"), of the Company to
stockholders of record at the close of business on November 15,
1988 (the "Record Date"), with such Rights to expire on November
15, 1998. On June 25, 1998, the Board of Directors of the
Company extended the expiration date of the Rights and adopted
certain amendments to the terms of the Rights. Except as set
forth below, each Right (as amended), when exercisable, entitles
the registered holder to purchase from the Company one
one-thousandth share of a series of preferred stock, designated
as Series A Preferred Stock, $0.01 par value (the "Preferred
Stock"), at a price of $200.00 per share (the "Purchase Price"),
subject to adjustment. The description and terms of the Rights,
as amended, are set forth in an Amended and Restated Rights
Agreement (the "Rights Agreement") between the Company and Harris
Trust and Savings Bank, as Rights Agent.
Initially, the Rights will be attached to all Common Stock
certificates representing shares then outstanding, and no
separate Rights certificates will be distributed. Until the
earlier to occur of (i) the first date of public announcement
that, without the prior consent of the Disinterested Directors
(as defined in the Rights Agreement), a Person (as defined in the
Rights Agreement), alone or together with its Affiliates and
Associates (as defined in the Rights Agreement), has acquired, or
obtained the right to acquire, beneficial ownership of 15% or
more of the outstanding shares of Common Stock of the Company
(the "Stock Acquisition Date") or (ii) the close of business on
the tenth (10th) business day (unless such date is extended by
the Board of Directors) following the commencement of (or a
public announcement of an intention to make) a tender offer or
exchange offer which would result in any Person or group of
related Persons becoming an Acquiring Person (the earliest of
such dates being called the "Distribution Date"), the Rights will
be evidenced, with respect to any of the Common Stock
certificates outstanding as of June 25, 1998, by such Common
Stock certificates.
The Rights Agreement provides that, until the Distribution
Date, the Rights will be transferred with and only with Common
Stock certificates. From as soon as practicable after the Record
Date and until the Distribution Date (or earlier redemption or
expiration of the Rights), new Common Stock certificates issued
after June 25, 1998 upon transfer, replacement or new issuance of
the Common Stock will contain a notation incorporating the Rights
Agreement by reference. Until the Distribution Date (or earlier
redemption or expiration of the Rights), the surrender for
transfer of any Common Stock certificates outstanding as of the
Record Date (with
<PAGE>
or without this Summary or Rights attached) will also constitute
the transfer of the Rights associated with the Common Stock
represented by such certificate. As soon as practicable
following the Distribution Date, separate certificates evidencing
the Rights ("Rights Certificates") will be mailed to holders of
record of the Common Stock as of the close of business on the
Distribution Date, and the separate Rights Certificates alone
will evidence the Rights.
The Rights are not exercisable until the Distribution Date
and will expire on November 15, 2008, unless earlier redeemed by
the Company as described below.
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 the Preferred
Stock of certain rights or warrants to subscribe for Preferred
Stock, certain convertible securities or securities having the
same or more favorable rights, privileges and preferences as the
Preferred Stock at less than the current market price of the
Preferred Stock or (iii) upon the distribution to holders of the
Preferred Stock of evidences of indebtedness or assets (excluding
regular quarterly cash dividends out of earnings or retained
earnings) or of subscription rights or warrants (other than those
referred to above).
The Purchase Price is also subject to adjustment in the
event of a stock split of the outstanding shares of Common Stock,
or a stock dividend on the outstanding shares of Common Stock
payable in shares of Common Stock, or subdivisions,
consolidations or combinations of the outstanding shares of
Common Stock occurring, in any such case, prior to the
Distribution Date.
With certain exceptions, no adjustments in the Purchase
Price will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price. No fractional
Rights will be issued and, in lieu thereof, an adjustment in cash
will be made based on the market price of the Rights on the last
trading date prior to the date of on which such fractional Rights
would otherwise be issuable.
In the event that any Person becomes an Acquiring Person
(unless pursuant to a tender offer or exchange offer for all
outstanding shares of Common Stock at a price and on terms
determined, prior to the purchase of shares under such tender or
exchange offer, by at least a majority of the members of the
Disinterested Directors to be both adequate and otherwise in the
best interests of the Company and its stockholders (a "Permitted
Offer")), proper provision shall be made so that each holder of a
Right will thereafter have the right for a 60-day period after
the later of (i) the date of such event or (ii) the effectiveness
of an appropriate registration statement, to receive upon
exercise of the Right that number of units of one one-thousandths
of a share of Preferred Stock (or, under certain circumstances,
shares of Common Stock or other securities) having an average
market value during a specified time period (immediately prior to
the occurrence of a Person becoming an Acquiring Person) of two
times the Purchase Price of the
Right (such right being called the "Flip-In Right").
Disinterested Directors are directors of the
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Company who are not (i) officers or employees of the Company,
(ii) Acquiring Persons or Affiliates or Associates thereof, or
representatives of any of them, or (iii) any Person who was
directly or indirectly proposed or nominated as a director of the
Company by an Acquiring Person.
In the event that, at any time on or following the Stock
Acquisition Date, the Company is, directly or indirectly,
acquired in a merger or other business combination transaction or
50% or more of the Company's assets or earning power are sold (in
one transaction or a series of transactions), proper provision
shall be made so that each holder of a Right (except a Right
voided as set forth below) shall thereafter have the right to
receive, upon the exercise thereof at the then current Purchase
Price of the Right, that number of shares of common stock of the
acquiring company (or, in the event there is more than one
acquiring company, the acquiring company receiving the greatest
portion of the assets or earning power transferred) which, on the
date of the consummation of such transaction, would have a market
value of two times the Purchase Price of the Right (such right
being called the "Flip-Over Right").
The holder of a Right will continue to have the Flip-Over
Right whether or not such holder exercises the Flip-In Right.
Upon the occurrence of any of the events giving rise to the
exercisability of the Flip-Over Right or the Flip-In Right, any
Rights that are or were at any time owned by an Acquiring Person
engaging in any of such transactions or receiving the benefits
thereof on or after the time the Acquiring Person becomes such
shall become null and void insofar as they relate to the Flip-
Over Right or the Flip-In Right.
The number of outstanding Rights associated with each share
of Common Stock and the voting and economic rights of each one
one-thousandth of a share of Preferred Stock issuable upon
exercise of each Right are also subject to adjustment in the
event of a stock split of the Common Stock or a stock dividend on
the Common Stock payable in Common Stock or subdivisions,
consolidations or combinations of the Common Stock occurring, in
any such case, prior to the Distribution Date.
At any time prior to the earlier to occur of (i) the close
of business on the Stock Acquisition Date or (ii) the expiration
of the Rights, the Company may redeem the rights in whole, but
not in part, at a price of $.01 per Right (the "Redemption
Price"), which redemption shall be effective upon the
authorization of a majority of the Board of Directors.
Additionally, following the Stock Acquisition Date and the
expiration of the period during which the Flip-In is exercisable,
the Company may redeem the then outstanding Rights in whole, but
not in part, at the Redemption Price provided that such
redemption is in connection with a merger or other business
combination transaction or series of transactions involving the
Company in which all holders of Common Stock are treated alike,
but not involving an Acquiring Person or any Affiliates or
Associates thereof. The redemption of Rights described in the
preceding sentence shall be effective only as of such time when
the Flip-in Right is not exercisable, and in any event, only
after 10 business days prior notice. Upon the effective date of
the 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.
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<PAGE>
At any time after a Person becomes an Acquiring Person but
before such Acquiring Person, together with all Affiliates and
Associates of such Person, becomes the Beneficial Owner of 50% or
more of the Common Shares then outstanding, the Company may, at
its option, exchange all or part of the then outstanding and
exercisable Rights (other than those owned by the Acquiring
Person, together with any Affiliates and Associates of such
Acquiring Person, which have become null and void) at an exchange
ratio of one share of Common Stock per Right, appropriately
adjusted to reflect any stock split, stock dividend or similar
transaction involving either the Common Stock or the Preferred
Stock occurring after the date hereof (the "Exchange Ratio").
Immediately upon the action of the Board of Directors ordering
the exchange of any Rights and without any further action and
without any notice, the right to exercise such Rights shall
terminate and the only right thereafter of a holder of such
Rights shall be to receive that number of shares of Common Stock
equal to the number of such Rights held by such holder multiplied
by the Exchange Ratio.
The Preferred Stock purchasable upon exercise of the Rights
will be nonredeemable and junior to any other series of preferred
stock the Company may issue (unless otherwise provided in the
terms of such stock). Each share of Preferred Stock will have a
preferential quarterly dividend in an amount equal to 1,000 times
the dividend declared on each share of Common Stock, but in no
event less than $10.00. In the event of liquidation, the holders
of Preferred Stock will receive a preferred liquidation payment
equal to the greater of 1,000 times the payment made per share of
Common Stock. In the event of liquidation, the holders of
Preferred Stock will receive a preferred liquidation payment per
share equal to the greater of 1,000 times the Purchase Price per
Right or 1,000 times the payment made per each share of Common
Stock.
Each share of Preferred Stock will have 1,000 votes, voting
together with the shares of Common Stock, on all matters
submitted to a vote of the shareholders of the Company. If the
Company fails to pay dividends on the Preferred Stock for a
specified period (a "default period"), the holders of Preferred
Stock shall have the additional right to elect two (2) directors
to the Board of Directors until such default period expires.
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 1,000 times
the amount and type of consideration received per share of Common
Stock. The rights of the Preferred Stock as to dividends and
liquidation, and in the event of mergers and consolidations, are
protected by customary anti-dilution provisions. Fractional
shares of Preferred Stock will be issuable; however, the Company
may elect to distribute depositary receipts in lieu of such
fractional shares. In lieu of fractional shares other than
fractions that are multiples of one one-thousandth of a share, 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.
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.
The terms of the Rights may be amended by the Board of
Directors of the Company and the Rights Agent, (i) prior to the
Distribution Date in any manner, and (ii) on or after the
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<PAGE>
Distribution Date to cure any ambiguity, to shorten or lengthen
any time period under the Rights Agreement, to correct or
supplement any provision of the Rights Agreement which may be
defective or inconsistent with any other provisions, or in any
manner not adversely affecting the interests of the holders of
the Rights.
Attached hereto as Exhibit 4.1 and incorporated herein by
reference is a copy of the form of Amended and Restated Rights
Agreement between the Company and Harris Trust and Savings Bank
specifying the terms of the Rights and the exhibits thereto, as
follows: Exhibit A - The Amended Certificate of Designation;
Exhibit B - The Form of Rights Certificate; and Exhibit C - The
Summary of Rights to Purchase Preferred Shares. The foregoing
description of the Rights is qualified in its entirety by
reference to the Amended and Restated Rights Agreement.
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<PAGE>
Item 2. Exhibits
--------
4.1 Form of Amended and Restated Rights Agreement dated as
of June 25, 1998 between the Company and Harris Trust
and Savings Bank, which includes, as Exhibit A thereto,
the form of Amended Certificate of Designation
specifying the terms of the Preferred Stock and, as
Exhibit B thereto, the form of Rights Certificate, and
as Exhibit C thereto, the Summary of Rights to Purchase
Preferred Shares.
99.1 Press Release dated June 26, 1998 announcing the
adoption of the Amended and Restated Rights Agreement.
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<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this
registration statement to be signed on its behalf by the
undersigned, thereto duly authorized.
FIRSTFED FINANCIAL CORP.
By: /s/ Ann E. Lederer
________________________
Name: Ann E. Lederer
Title: Senior Vice President
and General Counsel
Dated: June 25, 1998
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<PAGE>
EXHIBIT INDEX
Exhibit Description Page
- ------- ----------- ----
4.1 Form of Amended and Restated Rights
Agreement dated as of June 25, 1998 between
the Company and Harris Trust and Savings
Bank, which includes, as Exhibit A thereto,
the form of Amended Certificate of
Designation specifying the terms of the
Preferred Stock and, as Exhibit B thereto,
the form of Rights Certificate, and as
Exhibit C thereto, the Summary of Rights
to Purchase Preferred Shares. 9
99.1 Press Release dated June 26, 1998
announcing the adoption of the Amended
and Restated Rights Agreement. 92
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EXHIBIT 4.1
_________________________________
FIRSTFED FINANCIAL CORP.
and
HARRIS TRUST AND SAVINGS BANK
Rights Agent
_________________________________
Amended and Restated Rights Agreement
Dated as of June 25, 1998
_________________________________
<PAGE>
TABLE OF CONTENTS
Page
Section 1. Certain Definitions............................ 2
Section 2. Appointment of Rights Agent.................... 6
Section 3. Issue of Rights Certificates................... 7
Section 4. Form of Rights Certificates.................... 9
Section 5. Countersignature and Registration.............. 10
Section 6. Transfer, Split Up, Combination and Exchange of
Rights Certificates; Mutilated, Destroyed, Lost
or Stolen Rights Certificates.................. 11
Section 7. Exercise of Rights; Purchase Price; Expiration
Date of Rights................................. 12
Section 8. Cancellation and Destruction of Rights
Certificates................................... 15
Section 9. Reservation and Availability of Preferred Stock 16
Section 10. Preferred Stock Record Date.................... 17
Section 11. Adjustment of Purchase Price, Number and Kind
of Shares or Number of Rights.................. 18
Section 12. Certificate of Adjusted Purchase Price or
Number of Shares............................... 29
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power........................ 29
Section 14. Additional Covenants........................... 33
Section 15. Fractional Rights and Fractional Shares........ 34
Section 16. Rights of Action............................... 36
Section 17. Agreement of Rights Holders ................... 36
Section 18. Rights Certificate Holder Not Deemed a
Stockholder.................................... 37
Section 19. Concerning the Rights Agent.................... 38
Section 20. Merger or Consolidation or Change of Name of
Rights Agent................................... 39
Section 21. Duties of Rights Agent......................... 40
Section 22. Change of Rights Agent......................... 43
Section 23. Issuance of New Rights Certificates............ 44
Section 24. Redemption and Termination..................... 45
Section 25. Exchange....................................... 47
Section 26. Notice of Certain Events....................... 49
Section 27. Notices........................................ 50
Section 28. Supplements and Amendments..................... 51
Section 29. Determination and Actions by the Board of
Directors, etc................................. 52
Section 30. Successors..................................... 52
Section 31. Benefits of this Agreement..................... 53
Section 32. Governing Law.................................. 53
Section 34. Counterparts................................... 53
Section 35. Descriptive Headings........................... 53
<PAGE>
Exhibit A - Form of Amended Certificate of Designation of
Series A Preferred Stock A-1
Exhibit B - Form of Rights Certificate B-1
Exhibit C - Form of Summary of Rights C-1
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DEFINED TERM CROSS REFERENCE SHEET
Acquiring Person.....................................Section 1(a)
Act..................................................Section 1(b)
Adjusted Number of Shares......................Section 11(a)(iii)
Adjusted Purchase Price........................Section 11(a)(iii)
Adjustment Shares...............................Section 11(a)(ii)
Affiliate............................................Section 1(c)
Appointment of Rights Agent.............................Section 2
Associate............................................Section 1(c)
Beneficial Owner.....................................Section 1(d)
Beneficially Own.................................Section 1(d)(ii)
Business Day.........................................Section 1(e)
Capital Stock Equivalent.......................Section 11(a)(iii)
Close of Business....................................Section 1(f)
Common Stock.........................................Section 1(g)
Company...................................................Preface
Current Market Price.............................Section 11(d)(i)
Disinterested Director...............................Section 1(h)
Distribution Date....................................Section 3(a)
Equivalent Preferred Stock..........................Section 11(b)
Exchange Act.........................................Section 1(c)
Exchange Ratio......................................Section 25(a)
Expiration Date......................................Section 7(a)
Final Expiration Date................................Section 7(a)
Permitted Offer......................................Section 1(k)
Person...............................................Section 1(l)
Pre-Amendment Right.......................................Preface
Preferred Stock......................................Section 1(m)
Principal Party.................................Section 13(b)(ii)
Prior Rights Agreement....................................Preface
Proration Factor...............................Section 11(a)(iii)
Purchase Price.......................................Section 4(a)
Record Date...............................................Preface
Redemption Date......................................Section 7(a)
Redemption Price....................................Section 24(a)
Right.....................................................Preface
Rights Agent..............................................Preface
Rights Agreement.....................................Section 3(c)
Rights Certificate...................................Section 3(a)
Section 11(a)(ii) Event..............................Section 1(p)
Section 13 Event.....................................Section 1(q)
Security.........................................Section 11(d)(i)
Stock Acquisition Date...............................Section 1(r)
<PAGE>
Subsidiary...........................................Section 1(s)
Summary of Rights....................................Section 3(b)
Then Outstanding................................Section 1(d)(iii)
Trading Day......................................Section 11(d)(i)
Triggering Event.....................................Section 1(t)
Voting Power.........................................Section 1(u)
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RIGHTS AGREEMENT
----------------
This Amended and Restated Agreement, dated as of June 25,
1998, between FirstFed Financial Corp., a Delaware corporation
(the "Company"), and Harris Trust and Savings Bank (the "Rights
Agent").
W I T N E S S E T H
-------------------
WHEREAS, on November 2, 1988, the Board of Directors of
the Company authorized and declared a dividend distribution of
one right (a "Pre-Amendment Right") for each share of Common
Stock, $0.01 par value per share, of the Company (the "Common
Stock") outstanding on November 15, 1988 (the "Record Date"), and
contemplated the issuance of one right (subject to adjustment as
provided herein) for each share of Common Stock of the Company
issued between the Record Date and the earliest of the
Distribution Date and the Expiration Date (as such terms are
hereinafter defined), each Pre-Amendment Right representing the
right to purchase one one-hundredth of a share of Series A
Preferred Stock, par value $0.01 per share, of the Company having
the rights, powers and preferences set forth in the form of
Certificate of Designation attached hereto as Exhibit A to the
Rights Agreement dated November 2, 1988 between the Company and
the Rights Agent (the "Prior Rights Agreement"), upon the terms
and subject to the conditions hereinafter set forth therein;
WHEREAS, on June 25, 1998, the Board of Directors of the
Company determined that it was advisable and in the best
interests of the Company and its stockholders to amend and
restate in its entirety the Prior Rights Agreement as set forth
herein and the Pre-Amendment Rights shall henceforth be governed
by the terms and subject to the conditions set forth herein and
that each Pre-Amendment Right shall hereafter be referred to as
one Right (a "Right") and each Right shall represent the right to
purchase one one-thousandth of a share of Series A Preferred
Stock of the Company having the rights, powers and preferences
set forth in the form of Amended Certificate of Designation
attached hereto as Exhibit A, upon the terms and subject to the
conditions set forth therein; and
<PAGE>
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereto hereby
agree as follows:
Section 1. Certain Definitions. For purposes of this
-------------------
Agreement, the following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as such
term is hereinafter defined) who or which, together with all
Affiliates (as such term is hereinafter defined) and Associates
(as such term is hereinafter defined) of such Person, without the
prior approval of at least a majority of the Disinterested
Directors of the Company, shall be the Beneficial Owner (as such
term is hereinafter defined) of securities representing 15% or
more of the shares of Common Stock then outstanding (other than
as a result of a Permitted Offer (as hereinafter defined) or who
was such a Beneficial Owner at any time after the date hereof,
whether or not such Person continues to be the Beneficial Owner
of securities representing 15% or more of the outstanding shares
of Common Stock. Notwithstanding the foregoing, (A) the term
Acquiring Person shall not include (i) the Company, (ii) any
Subsidiary (as such term is hereinafter defined) of the Company,
(iii) any employee benefit plan of the Company or of any
Subsidiary of the Company or (iv) any Person or entity organized,
appointed or established by the Company or any Subsidiary of the
Company for or pursuant to the terms of any such plan and (B) no
Person shall become an "Acquiring Person" (i) as a result of the
acquisition of shares of Common Stock by the Company which, by
reducing the number of shares of Common Stock outstanding,
increases the proportional number of shares beneficially owned by
such Person together with all Affiliates and Associates of such
Person, provided, that if (1) a Person would become an Acquiring
Person (but for the operation of this subclause (i)) as a result
of the acquisition of shares of Common Stock by the Company, and
(2) after such share acquisition by the Company, such Person, or
an Affiliate or Associate of such Person, becomes the Beneficial
Owner of any additional shares of Common Stock (except as the
result of a stock split, stock dividend, recapitalization or
similar transaction), then such Person shall be deemed an
Acquiring Person or; (ii) if (1) within five Business Days after
such Person would otherwise have become an Acquiring Person (but
for the
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operation of this subclause (ii)), such Person notifies the Board
of Directors that such Person did so inadvertently, and
(2) within two Business Days after such notification (or such
greater period of time as may be determined by action of the
Board of Directors, but in no event greater than five Business
Days), such Person divests itself of a sufficient number of
shares of Common Stock so that such Person is the Beneficial
Owner of less than 15% of the outstanding shares of Common Stock.
(b) "Act" shall mean the Securities Act of 1933, as
amended and as in effect on the date of this Agreement.
(c) "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the
General Rules and Regulations under the Securities Exchange Act
of 1934, as amended, and in effect on the date of this Agreement
(the "Exchange Act").
(d) A Person shall be deemed the "Beneficial Owner"
of, and shall be deemed to "beneficially own," any securities:
(i) which such Person or any of such Person's
Affiliates or Associates beneficially owns, directly or
indirectly;
(ii) which such Person or any of such Person's Affiliates
or Associates has (A) the right or obligation to acquire (whether
such right or obligation is exercisable or effective immediately
or only after the passage of time) pursuant to any agreement,
arrangement or understanding (whether or not in writing) or upon
the exercise of conversion rights, exchange rights, 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 or on behalf of such Person or
any of such Person's Affiliates or Associates until such tendered
securities are accepted for purchase or exchange; or (B) the
right to vote pursuant to any agreement, arrangement or
understanding (whether or not in writing); provided, however,
that a Person shall not be deemed the "Beneficial Owner" of, or
to "beneficially own," any security under this clause (B) if the
agreement, arrangement or understanding to vote such security (1)
arises solely from a revocable proxy or
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consent given to such Person in response to a public proxy or
consent solicitation made pursuant to, and in accordance with,
the applicable rules and regulations promulgated under the
Exchange Act; or
(iii) which are beneficially owned, directly
or indirectly, by any other Person (or any Affiliate or Associate
thereof) with which such Person (or any of such Person's
Affiliates or Associates) has any agreement, arrangement or
understanding (whether or not in writing), or with which such
Person or any of such Person's Affiliates have otherwise formed a
group, related to the acquisition, holding, voting (except
pursuant to a revocable proxy or consent as described in clause
(B) of subparagraph (ii) of this paragraph (d)) or disposing of
any securities of the Company (other than customary agreements
with and between underwriters and selling group members with
respect to a bona fide public offering of securities).
Notwithstanding anything in this definition of Beneficial
Ownership to the contrary, the phrase "then outstanding," when
used with reference to a Person's Beneficial Ownership of
securities of the Company, shall mean the number of such
securities then issued and outstanding together with the number
of such securities not then actually issued and outstanding which
such Person would be deemed to own beneficially hereunder.
(e) "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in the
State of Illinois are authorized or obligated by law or executive
order to close.
(f) "Close of business" on any given date shall mean
5:00 P.M., Chicago time on such date; provided, however, that if
such date is not a Business Day it shall mean 5:00 P.M. Chicago
time on the next succeeding Business Day.
(g) "Common Stock" when used in reference to the
Company shall mean the Common Stock, $0.01 par value, of the
Company or, in the event of a subdivision, combination or
consolidation with respect to such shares of Common Stock, the
shares of Common Stock resulting from such subdivision,
combination or consolidation. "Common Stock" when used with
reference to any Person other than the Company shall mean the
capital stock with the
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greatest voting power, or the equity securities or other equity
interest having power to control or direct the management, of
such Person or, if such Person is a subsidiary of another Person,
of the Person or Persons which ultimately control such first-
mentioned Person.
(h) "Disinterested Director" means any director of the
Board of Directors of the Company who is not (a) an officer or
employee of the Company, (b) a Person proposing or attempting to
effect a business combination or similar transaction with the
Company (including, without limitation, a merger, tender offer or
exchange offer, sale of substantially all of the Company's
assets, or liquidation of the Company's assets) or any Affiliate
or Associate of such Person or Person acting directly or
indirectly on behalf of, or as a representative of, or in concert
with, any such Person, Affiliate or Associate, (c) an Acquiring
Person, an Affiliate or Associate of an Acquiring Person, or a
Person acting directly or indirectly on behalf of, or as a
representative of, or in concert with, an Acquiring Person or an
Affiliate or Associate of an Acquiring Person, or (d) any Person
who was directly or indirectly proposed or nominated as a
director of the Company by an Acquiring Person.
(i) "Distribution Date" shall have the meaning set
forth in Section 3 hereof.
(j) "Final Expiration Date" shall have the meaning set
forth in Section 7 hereof.
(k) "Permitted Offer" shall mean a tender or exchange
offer for all outstanding shares of Common Stock at a price and
on terms determined, prior to the purchase of shares under such
tender or exchange offer, by at least a majority of the
Disinterested Directors to be adequate and otherwise in the best
interests of the Company and its shareholders (other than the
Person or any Affiliate or Associate thereof on whose behalf the
offer is being made) taking into account all factors that such
directors may deem relevant.
(l) "Person" shall mean any individual, firm,
corporation, partnership, joint venture, association, trust,
limited liability company or other entity, and shall include any
successor (by merger or otherwise) of such entity.
-5-
<PAGE>
(m) "Preferred Stock" shall mean the Series A
Preferred Stock, $0.01 par value per share, of the Company.
(n) "Purchase Price" shall have the meaning set forth
in Section 4 hereof. As set forth in Section 7(b) hereof, the
Purchase Price shall initially be $200.00, subject to adjustment
as provided herein.
(o) "Record Date" shall mean November 15, 1988.
(p) "Section 11(a)(ii) Event" shall mean any event
described in Section 11(a)(ii) hereof.
(q) "Section 13 Event" shall mean any event described
in clause (x), (y) or (z) of Section 13(a) hereof.
(r) "Stock Acquisition Date" shall mean the first date
of public announcement by the Company or an Acquiring Person that
an Acquiring Person has become such, provided, that if such
Person is determined not to have become an Acquiring Person
pursuant to Section 1(a) hereof, then no Stock Acquisition Date
shall be deemed to have occurred.
(s) A "Subsidiary" of any Person shall mean any
corporation or other Person of which a majority of the voting
power of the voting equity securities or equity interests is
owned, directly or indirectly, by such Person, or which is
otherwise controlled by such Person.
(t) "Triggering Event" shall mean any Section
11(a)(ii) Event or any Section 13 Event.
(u) "Voting Power" shall mean the voting power of all
securities of the Company then outstanding and generally entitled
to vote for the election of directors of the Company.
Section 2. Appointment of Rights Agent. The Company hereby
---------------------------
appoints the Rights Agent to act as agent for the Company and the
holders of the Rights (who, in accordance with Section 3 hereof,
shall prior to the Distribution Date also be the holders of the
Common Stock) in accordance with the terms and conditions hereof,
and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such Co-Rights Agents as it
may
-6-
<PAGE>
deem necessary or desirable. In the event the Company appoints
one or more Co-Rights Agents, the respective duties of the Rights
Agents and any Co-Rights Agents shall be as the Company shall
determine.
Section 3. Issue of Right Certificates.
---------------------------
(a) Until the earlier of (i) the Stock Acquisition
Date or (ii) the close of business on the tenth Business Day
after the date of the commencement of, or first public
announcement of the intention of any Person (other than the
Company, any Subsidiary of the Company, or any employee benefit
plan of the Company or any Subsidiary of the Company, or any
Person or entity organized, appointed or established by the
Company or any Subsidiary of the Company for or pursuant to the
terms of any such plan) to commence (which intention to commence
remains in, effect for five business days after such
announcement), a tender or exchange offer, the consummation of
which would result in any Person becoming an Acquiring Person,
unless such date is extended by the Board of Directors of the
Company (the earliest of such dates being herein referred to as
the "Distribution Date"), (x) the Rights shall be evidenced
(subject to the provisions of paragraph (b) of this Section 3) by
the certificates for Common Stock registered in the names of the
holders of the Common Stock (which certificates for Common Stock
shall be deemed also to be certificates for Rights) and not by
separate certificates, and (y) the Rights (and the right to
receive certificates therefor) shall be transferable only in
connection with the transfer of the underlying shares of Common
Stock (including a transfer to the Company); provided, however,
that if a tender offer is terminated prior to the occurrence of a
Distribution Date, then no Distribution Date shall occur as a
result of such tender offer. As soon as practicable after the
Distribution Date, the Rights Agent shall send by first-class,
insured, postage prepaid mail at the expense of the Company, to
each record holder of the Common Stock as of the close of
business on the Distribution Date, at the address of such holder
shown on the records of the Company, a certificate for Rights, in
substantially the form of Exhibit B hereto (the "Rights
Certificates"), evidencing one Right for each share of Common
-7-
<PAGE>
Stock so held. As of and after the Distribution Date, the Rights
shall be evidenced solely by such Rights Certificates.
(b) With respect to certificates for the Common Stock
outstanding as of the date of this Agreement, until the
Distribution Date (or earlier redemption, expiration or
termination of the Rights), the Rights shall be evidenced by such
certificates for the Common Stock and the registered holders of
the Common Stock shall also be the registered holders of the
associated Rights. Until the Distribution Date (or earlier
redemption, expiration or termination of the Rights), the
surrender for transfer of any of the certificates for the Common
Stock outstanding on or after the Record Date shall also
constitute the transfer of the Rights associated with the Common
Stock represented by such certificate. Upon the request of the
holder of any shares of Common Stock or, after the Distribution
Date, the holder of any Rights, the Company shall, at its
expense, provide a copy of a Summary of Rights, in substantially
the form attached hereto as Exhibit C (the "Summary of Rights").
(c) Certificates issued for shares of Common Stock
(including, without limitation, certificates issued upon transfer
or exchange of Common Stock or reacquired shares of Common Stock
referred to in the last sentence of this paragraph (c) or shares
which become outstanding) after the date of this Agreement, but
prior to the earlier of the Distribution Date or the Expiration
Date (as such term is hereinafter defined), shall be deemed also
to be certificates for Rights, and shall have impressed, printed,
stamped, written or otherwise affixed onto them the following
legend:
This certificate also evidences and entitles
the holder hereof to certain Rights as set
forth in the Amended and Restated Rights
Agreement between FirstFed Financial Corp.
and Harris Trust and Savings Bank (the
"Rights Agent") dated as of June 25, 1998
(the "Rights Agreement") the terms of which
are hereby incorporated herein by reference
and a copy of which is on file at the
principal offices of FirstFed Financial Corp.
Under certain circumstances, as set forth in
the Rights Agreement, such Rights may be
redeemed, may expire, or may be evidenced by
separate certificates and will no longer be
evidenced by this certificate. FirstFed
-8-
<PAGE>
Financial Corp. will mail to the holder of
this certificate a copy of the Rights
Agreement without charge within five days
after receipt of a written request therefor.
Under certain circumstances set forth in the
Rights Agreement, Rights issued to or held by
any Person who is, was or becomes an
Acquiring Person or an Affiliate or Associate
thereof (as defined in the Rights Agreement)
and certain related persons whether currently
held by or on behalf of such Person or by any
subsequent holder of such Rights may become
null and void.
With respect to such certificates containing the foregoing
legend, until the Distribution Date, the Rights associated with
the Common Stock represented by such certificates shall be
evidenced by such certificates alone, and the surrender for
transfer of any of such certificates shall also constitute the
transfer of the Rights associated with the Common Stock
represented by such certificate. In the event that the Company
purchases or acquires any shares of Common Stock prior to the
Distribution Date, any Rights associated with such shares of
Common Stock shall be deemed canceled and retired so that the
Company shall not be entitled to exercise any Rights associated
with the shares of Common Stock which are no longer outstanding.
Section 4. Form of Rights Certificates.
---------------------------
(a) The Rights Certificates (and the forms of election
to purchase shares and of assignment to be printed on the reverse
thereof) shall each be substantially in the form set forth in
Exhibit B hereto and may have such marks of identification or
designation and such legends, summaries or endorsements printed
thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be
required to comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regulation
of any stock exchange on which the Rights may from time to time
be listed, or to conform to usage. Subject to the provisions of
Section 11 and Section 23 hereof, the Rights Certificates,
whenever distributed on their face shall entitle the holders
thereof to purchase such number of one one-thousandths of a share
of Preferred Stock as shall be set forth therein at the price per
one one-thousandth of a share set forth therein (the "Purchase
Price"), but the amount
-9-
<PAGE>
and type of securities purchasable upon the exercise of each
Right and the Purchase Price thereof shall be subject to
adjustment as provided herein.
(b) Any Rights Certificate issued pursuant to Section
3(a) or Section 23(a) hereof that represents Rights which are
null and void pursuant to Section 7(e) of this Agreement and any
Rights Certificates issued at any time upon the transfer of any
Rights to such an Acquiring Person or any Associate or Affiliate
thereof or to any nominee of such Acquiring Person, Associate or
Affiliate, and any Rights Certificate issued pursuant to Section
6 or Section 11 upon transfer, exchange, replacement or
adjustment of any other Rights Certificate referred to in this
sentence, shall contain (to the extent feasible) the following
legend:
The Rights represented by this Rights
Certificate are or were beneficially owned by
a Person who was or became an Acquiring
Person or an Affiliate or an Associate of an
Acquiring Person (as such terms are defined
in the Rights Agreement) or certain related
persons. Accordingly, this Rights
Certificate and the Rights represented hereby
are null and void.
The provisions of Section 7(e) of this Rights Agreement shall be
operative whether or not the foregoing legend is contained on any
such Rights Certificate.
Section 5. Countersignature and Registration. The Rights
---------------------------------
Certificates shall be executed on behalf of the Company by its
Chairman of the Board, any Vice Chairman of the Board, its
President, its Chief Executive Officer, or any Vice President, or
its Treasurer, either manually or by facsimile signature, and
shall have affixed thereto the Company's seal or a facsimile
thereof which shall be attested by the Secretary or an Assistant
Secretary of the Company, either manually or by facsimile
signature. The Rights Certificates shall be countersigned by the
Rights Agent and shall not be valid for any purpose unless so
countersigned. In case any officer of the Company who shall have
signed any of the Rights Certificates shall cease to be such
officer of the Company before countersignature by the Rights
Agent and issuance and delivery by the Company, such Rights
Certificates, nevertheless, may be countersigned by the Rights
Agent, and issued and delivered by the Company with the same
force and effect as though the person who
-10-
<PAGE>
signed such Rights Certificates had not ceased to be such officer
of the Company; and any Rights Certificates may be signed on
behalf of the Company by any person who, at the actual date of
the execution of such Rights Certificate, shall be a proper
officer of the Company to sign such Rights Certificate, although
at the date of the execution of this Rights Agreement any such
person was not such an officer.
Following the Distribution Date, the Rights Agent will keep
or cause to be kept, at the offices designated by the Rights
Agent, books for registration and transfer of the Rights
Certificates issued hereunder. Such books shall show the names
and addresses of the respective holders of the Rights
Certificates, the number of Rights evidenced on its face by each
of the Rights Certificates and the certificate number and the
date of each of the Rights Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of
-----------------------------------------------
Rights Certificates; Mutilated, Destroyed, Lost or Stolen-Rights
- ----------------------------------------------------------------
Certificates. Subject to the provisions of Section 4(b), Section
- ------------
7(e) and Section 15 hereof, at any time after the close of
business on the Distribution Date, and at or prior to the close
of business on the Expiration Date, any Rights Certificate or
Rights Certificates may be transferred, split up, combined or
exchanged for another Rights Certificate or Rights Certificates,
entitling the registered holder to purchase a like number of one
one-thousandths of a share of Preferred Stock (or, following a
Triggering Event, other securities, as the case may be) as the
Rights Certificate or Rights Certificates surrendered then
entitled such holder (or former holder in the case of a transfer)
to purchase. Any registered holder desiring to transfer, split
up, combine or exchange any Rights Certificate or Rights
Certificates shall make such request in writing delivered to the
Rights Agent, and shall surrender the Rights Certificate or
Rights Certificates to be transferred, split up, combined or
exchanged at the principal Office of the Rights Agent. Neither
the Rights Agent nor the Company shall be obligated to take any
action whatsoever with respect to the transfer of any such
surrendered Rights Certificate until the registered holder shall
have completed and signed the certificate contained in the form
of assignment on the reverse side of such Rights Certificate and
shall have provided such additional evidence of the identity of
the Beneficial Owner (or former Beneficial
-11-
<PAGE>
Owner) or Affiliates or Associates thereof as the Company shall
reasonably request. Thereupon the Rights Agent shall, subject to
Section 4(b), Section 7(e) and Section 15 hereof, countersign and
deliver to the Person entitled thereto a Rights Certificate or
Rights Certificates, as the case may be, as so requested. The
Company may require payment of a sum sufficient to cover any tax
or governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Rights
Certificates.
Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction
or mutilation of a Rights Certificate, and in case of loss, theft
or destruction, of indemnity or security reasonably satisfactory
to them, and reimbursement to the Company and the Rights Agent of
all reasonable expenses incidental thereto, and upon surrender to
the Rights Agent and cancellation of the Rights Certificate if
mutilated, the Company shall execute and deliver a new Rights
Certificate of like tenor to the Rights Agent for
countersignature and delivery to the registered holder in lieu of
the Rights Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights, Purchase Price; Expiration
----------------------------------------------
Date of Rights.
- --------------
(a) Subject to Section 7(e) hereof, the registered
holder of any Rights Certificate may exercise the Rights
evidenced thereby (except as otherwise provided herein) in whole
or in part at any time after the Distribution Date upon surrender
of the Rights Certificate, with the appropriate form of election
to purchase and the certificate on the reverse side thereof duly
executed, to the Rights Agent at the principal office of the
Rights Agent, together with payment of the Purchase Price for the
total number of one one-thousandths of a share of Preferred Stock
(or other securities, as the case may be) as to which such
surrendered Rights are exercised, at or prior to the earliest of
(i) the close of business on November 15, 2008 (the "Final
Expiration Date"), or (ii) the time at which the Rights are
redeemed as provided in Section 24 hereof (the "Redemption Date")
or (iii) the time at which the Rights are exchanged as provided
in Section 25 hereof, or (iv) the consummation of a transaction
contemplated by Section 13(d) hereof (such earliest time being
herein referred to as the "Expiration Date"). Notwithstanding
-12-
<PAGE>
any other provision of this Agreement, any Person who prior to
the Distribution Date becomes a record holder of shares of Common
Stock may exercise all of the rights of a registered holder of a
Rights Certificate with respect to the Rights associated with
such shares of Common Stock in accordance with and subject to the
provisions of this Agreement, including the provisions of Section
7(e) hereof, as of the date such Person becomes a record holder
of shares of Common Stock.
(b) The Purchase Price for each one one-thousandth of
a share of Preferred Stock pursuant to the exercise of a Right
shall initially be $200.00, shall be subject to adjustment from
time to time as provided in Sections 11 and 13 hereof and shall
be payable in lawful money of the United States of America in
accordance with paragraph (c) below. Anything in this Agreement
to the contrary notwithstanding, in the event that at any time
after the date of this Agreement and prior to the Distribution
Date, the Company shall (i) declare or pay any dividend on the
outstanding shares of Common Stock payable in shares of Common
Stock or (ii) effect a subdivision, combination or consolidation
of the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of dividends in shares of Common Stock)
into a greater or lesser number of shares of Common Stock, then
in any such case, each share of Common Stock outstanding
following such subdivision, combination or consolidation shall
continue to have a Right associated therewith and the Purchase
Price following any such event shall be proportionately adjusted
to equal the result obtained by multiplying the Purchase Price
immediately prior to such event by a fraction the numerator of
which shall be the total number of shares of Common Stock
outstanding immediately prior to the occurrence of the event and
the denominator of which shall be the total number of shares of
Common Stock outstanding immediately following the occurrence of
such event. The adjustment provided for in the preceding
sentence shall be made successively whenever such a dividend is
declared or paid or such a subdivision, combination or
consolidation is effected.
(c) Upon receipt of a Rights Certificate representing
exercisable Rights, with the appropriate form of election to
purchase and certificate duly executed, accompanied by
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<PAGE>
payment of the Purchase Price for the shares (or other
securities, as the case may be) to be purchased and an amount
equal to any applicable transfer tax required to be paid by the
holder of such Rights Certificate in accordance with Section 6
hereof by certified check, cashier's check or money order payable
to the order of the Company, the Rights Agent shall, subject to
Section 21(k), thereupon promptly (i) (A) requisition from any
transfer agent of the shares of Preferred Stock (or make
available, if the Rights Agent is the transfer agent)
certificates for the number of shares of Preferred Stock to be
purchased, and the Company hereby irrevocably authorizes its
transfer agent to comply with all such requests, or (B) if the
Company, in its sole discretion, shall have elected to deposit
the shares of Preferred Stock issuable upon exercise of the
Rights hereunder into a depositary, requisition from the
depositary agent depositary receipts representing such number of
one one-thousandths of a share of Preferred Stock as are to be
purchased (in which case certificates for the shares of Preferred
Stock represented by such receipts shall be deposited by the
transfer agent with the depositary agent) and the Company shall
direct the depositary agent to comply with such requests, (ii)
when appropriate, requisition from the Company the amount of
cash, if any, to be paid in lieu of issuance of fractional shares
in accordance with Section 15, (iii) promptly after receipt of
such certificates or depositary receipts, cause the same to be
delivered to or upon the order of the registered holder of such
Rights Certificate, registered in such name or names as may be
designated by such holder and (iv) when appropriate, after
receipt promptly deliver such cash to or upon the order of the
registered holder of such Rights Certificate. In the event that
the Company is obligated to issue other securities (including
shares of Common Stock) of the Company pursuant to Section 11(a),
the Company shall make all arrangements necessary so that such
other securities are available for distribution by the Rights
Agent, if and when appropriate. In addition, in the case of an
exercise of the Rights by a holder pursuant to Section 11(a)(ii),
the Rights Agent shall return such Rights Certificate to the
registered holder thereof after imprinting, stamping or otherwise
indicating thereon that the rights represented by such Rights
Certificate no longer include the rights provided by Section
11(a)(ii) of the Rights Agreement and if less than all the Rights
represented
-14-
<PAGE>
by such Rights Certificate were so exercised, the Rights Agent
shall indicate on the Rights Certificate the number of Rights
represented thereby which continue to include the rights provided
by Section 11(a)(ii).
(d) In case the registered holder of any Rights
Certificate shall exercise (except pursuant to Section 11(a)(ii))
less than all the Rights evidenced thereby, a new Rights
Certificate evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent and delivered to
the registered holder of such Rights Certificate or to his duly
authorized assigns, subject to the provisions of Section 15
hereof, or the Rights Agent shall place an appropriate notation
on the Rights Certificate with respect to those Rights exercised.
(e) Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of a Section
11(a)(ii) Event, any Rights beneficially owned by (i) an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person, (ii) a transferee of an Acquiring Person (or of any
Affiliate or Associate thereof) who becomes a transferee after
the Acquiring Person becomes such, or (iii) a transferee of an
Acquiring Person (or of any Affiliate or Associate thereof) who
becomes a transferee prior to or concurrently with the Acquiring
Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the
Acquiring Person to holders of equity interests in such Acquiring
Person or to any Person with whom the Acquiring Person has a
continuing agreement, arrangement or understanding regarding the
transferred Rights or (B) a transfer which the Board of Directors
of the Company has determined is part of a plan, arrangement or
understanding which has as a primary purpose or effect the
avoidance of this Section 7(e), shall become null and void
without any further action and no holder of such Rights shall
have any rights whatsoever with respect to such Rights, whether
under any provision of this Agreement or otherwise. The Company
shall use all reasonable efforts to insure that the provisions of
this Section 7(e) and Section 4(b) hereof are complied with, but
shall have no liability to any holder of Rights Certificates or
other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or its
Affiliates, Associates or transferees hereunder.
-15-
<PAGE>
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be
obligated to undertake any action with respect to a registered
holder upon the occurrence of any purported exercise as set forth
in this Section 7 unless the certificate contained in the
appropriate form of election to purchase set forth on the reverse
side of the Rights Certificate surrendered for such exercise
shall have been properly completed and duly executed by the
registered holder thereof and the Company shall have been
provided with 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 Rights
--------------------------------------
Certificates. All Rights Certificates surrendered for the
- ------------
purpose of exercise (other than a partial exercise), transfer,
split up, combination or exchange shall, if surrendered to the
Company or any of its agents, be delivered to the Rights Agent
for cancellation or in cancelled form, or, if surrendered to the
Rights Agent, shall be cancelled by it, and no Rights
Certificates shall be issued in lieu thereof except as expressly
permitted by any of the provisions of this Rights Agreement. The
Company shall deliver to the Rights Agent for cancellation and
retirement, and the Rights Agent shall so cancel and retire, any
other Rights Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall
deliver all cancelled Rights Certificates to the Company, or
shall, at the written request of the Company, destroy such
cancelled Rights Certificates, and in such case shall deliver a
certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Preferred Stock.
-----------------------------------------------
(a) The Company covenants and agrees that at all times
prior to the occurrence of a Section 11(a)(ii) Event it will
cause to be reserved and kept available out of its authorized and
unissued shares of Preferred Stock, or any authorized and issued
shares of Preferred Stock held in its treasury, the number of
shares of Preferred Stock that will be sufficient to permit the
exercise in full of all outstanding Rights and, after the
occurrence of a Section 11(a)(ii) Event, shall, to the extent
reasonably practicable, so reserve and keep available
-16-
<PAGE>
a sufficient number of shares of Common Stock (and/or other
securities) which may be required to permit the exercise in full
of the Rights pursuant to this Agreement.
(b) So long as the shares of Preferred Stock (and,
after the occurrence of a Section 11(a)(ii) Event, shares of
Common Stock or other securities) issuable upon the exercise of
the Rights may be listed on any national securities exchange, the
Company shall use its best efforts to cause, from and after such
time as the Rights become exercisable, all shares (or other
securities) reserved for such issuance to be listed on such
exchange upon official notice of issuance upon such exercise.
(c) The Company covenants and agrees that it shall
take all such action as may be necessary to ensure that all
shares of Preferred Stock (or Common Stock and/or other
securities, as the case may be) delivered upon exercise of Rights
shall, at the time of delivery of the certificates for such
shares or other securities (subject to payment of the Purchase
Price), be duly and validly authorized and issued and fully paid
and nonassessable shares or securities.
(d) The Company further covenants and agrees that it
shall pay when due and payable any and all federal and state
transfer taxes and charges which may be payable in respect of the
issuance or delivery of the Rights Certificates or of any
certificates for shares of Preferred Stock (or Common Stock
and/or other securities, as the case may be) upon the exercise of
Rights. The Company shall not, however, be required to pay any
transfer tax which may be payable in respect of any transfer or
delivery of Rights Certificates to a person other than, or in
respect of the issuance or delivery of certificates or depositary
receipts for the shares of Preferred Stock (or Common Stock
and/or other securities, as the case may be) in a name other than
that of, the registered holder of the Rights Certificates
evidencing Rights surrendered for exercise or to issue or deliver
any certificates or depositary receipts for shares of Preferred
Stock (or Common Stock and/or other securities, as the case may
be) in a name other than that of the registered holder upon the
exercise of any Rights until any such tax shall have been paid
(any such tax being payable by the holder of such Rights
Certificate at the time of surrender) or until it has been
established to the Company's satisfaction that no such tax is
due.
-17-
<PAGE>
(e) The Company shall use its best efforts to (i)
file, as soon as practicable following the Stock Acquisition Date
(or, if required by law, at such earlier time following the
Distribution Date as so required), a registration statement under
the Act with respect to the securities purchasable upon exercise
of the Rights on an appropriate form, (ii) cause such
registration statement to become effective as soon as practicable
after such filing, and (iii) cause such registration statement to
remain effective (with a prospectus at all times meeting the
requirements of the Act and the rules and regulations thereunder)
until the date of the expiration of the rights provided by
Section 11(a)(ii). The Company will also take such action as may
be appropriate under the blue sky laws of the various states.
Section 10. Preferred Stock Record Date. Each person in
---------------------------
whose name any certificate for shares of Preferred Stock (or
Common Stock and/or other securities, as the case may be) is
issued upon the exercise of Rights shall for all purposes be
deemed to have become the holder of record of the shares of
Preferred Stock (or Common Stock and/or other securities, as the
case may be) represented thereby on, and such certificate shall
be dated, the date upon which the Rights Certificate evidencing
such Rights was duly surrendered and payment of the Purchase
Price (and any applicable transfer taxes) was made; provided,
however, that if the date of such presentation and payment is a
date upon which the Preferred Stock (or Common Stock and/or other
securities, as the case may be) transfer books of the Company are
closed, such person shall be deemed to have become the record
holder of such shares on, and such certificate shall be dated,
the next succeeding Business Day on which the Preferred Stock (or
Common Stock and/or other securities, as the case may be)
transfer books of the Company are open. Prior to the exercise of
the Rights evidenced thereby, the holder of a Rights Certificate,
as such, shall not be entitled to any rights of a shareholder of
the Company with respect to shares for which the Rights shall be
exercisable, including, without limitation, the right to vote, to
receive dividends or other distributions or to exercise any
preemptive rights, and shall not be entitled to receive any
notice of any proceedings of the Company, except as provided
herein.
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<PAGE>
Section 11. Adjustment of Purchase Price, Number and Kind
---------------------------------------------
of Shares or Number of Rights. The Purchase Price, the number
- -----------------------------
and kind of shares covered by each Right and the number of Rights
outstanding are subject to adjustment from time to time as
provided in this Section 11.
(a) (i) In the event the Company shall at any time
after the date of this Agreement (A) declare a dividend on the
Preferred Stock payable in shares of Preferred Stock, (B)
subdivide the outstanding Preferred Stock, (C) combine the
outstanding Preferred Stock into a smaller number of shares or
(D) issue any shares of its capital stock in a reclassification
of the Preferred Stock (including any such reclassification in
connection with a consolidation or merger in which the Company is
the continuing or surviving corporation), except as otherwise
provided in this Section 11(a) and in Section 7(e), the Purchase
Price in effect at the time of the record date for such dividend
or of the effective date of such subdivision, combination or
reclassification, and the number and kind of shares of capital
stock issuable on such date, shall be proportionately adjusted so
that the holder of any Right exercised after such time shall be
entitled to receive the aggregate number and kind of shares of
capital stock and other securities which, if such Right had been
exercised immediately prior to such date and at a time when the
Preferred Stock transfer books of the Company were open, such
holder would have owned upon such exercise and been entitled to
receive by virtue of such dividend, subdivision, combination or
reclassification; provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right be less
than the aggregate par value of the shares of capital stock of
the Company issuable upon the exercise of one Right. If an event
occurs which would require an adjustment under both Section
11(a)(i) and Section 11(a)(ii), the adjustment provided for in
this Section 11(a)(i) shall be in addition to, and shall be made
prior to, any adjustment required pursuant to Section 11(a)(ii).
(ii) In the event that any Person, alone or
together with its Affiliates and Associates, shall become an
Acquiring Person, then proper provision shall be made so that
each holder of a Right (except as provided below and in Section
7(e) hereof), shall, for a period
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<PAGE>
of 60 days after the later of the occurrence of any such event or
the effective date of an appropriate registration statement under
the Act pursuant to Section 9 hereof, have a right to receive,
upon exercise thereof at a price equal to the then current
Purchase Price, in accordance with the terms of this Agreement,
such number of shares of Common Stock of the Company (or in the
discretion of the Board of Directors, one one-thousandths of a
share of Preferred Stock) as shall equal the result obtained by
(x) multiplying the then current Purchase Price by the then
number of one one-thousandths of a share of Preferred Stock for
which a Right is then exercisable immediately prior to the first
occurrence of a Section 11(a)(ii) Event, and (y) dividing that
product by 50% of the then current market price per one share of
Common Stock (determined pursuant to Section 11(d) hereof) on the
date of such first occurrence (such number of shares being
referred to as the "Adjustment Shares"); 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) In the event that there shall not be
sufficient treasury shares or authorized but unissued shares (and
unreserved) of Common Stock to permit the exercise in full of the
Rights in accordance with the foregoing subparagraph (ii) and the
Rights become so exercisable (and the Board has determined to
make all or some of the Rights exercisable into fractions of a
share of Preferred Stock), notwithstanding any other provision of
this Agreement, to the extent necessary and permitted by
applicable law, each Right shall thereafter represent the right
to receive, upon exercise thereof at the then current Purchase
Price in accordance with the terms of this Agreement, (x) a
number of (or fractions of) shares of Common Stock (up to the
maximum number of shares of Common Stock which may permissibly be
issued) and (y) a number of one one-thousandths of a share of
Preferred Stock or a number of (or fractions of) other equity
securities of the Company (or, in the discretion of the Board of
Directors, debt) which the Board of Directors of the Company has
determined to have the same aggregate current market value
(determined pursuant to Sections 11(d)(i) and (ii) hereof, to the
extent applicable)
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<PAGE>
as one share of Common Stock (such number of, or fractions of,
shares of Preferred Stock (or other equity securities or debt of
the Company) being referred to as a "capital stock equivalent"),
equal in the aggregate to the number of Adjustment Shares;
provided, however, if there are unavailable sufficient shares (or
fractions of shares) of Common Stock and/or capital stock
equivalents, then the Company shall, to the extent permitted by
applicable law, take all such action as may be necessary to
authorize additional shares of Common Stock or capital stock
equivalents for issuance upon exercise of the Rights, including
the calling of a meeting of shareholders; and provided, further,
that the Company shall issue no capital stock equivalents upon
exercise of the Rights until the Company has first issued all
authorized and unreserved shares of Common Stock; and provided,
further, that if the Company is unable to cause sufficient shares
of Common Stock and/or capital stock equivalents to be available
for issuance upon exercise in full of the Rights, then each Right
shall thereafter represent the right to receive the Adjusted
Number of Shares upon exercise at the Adjusted Purchase Price (as
such terms are hereinafter defined). As used herein, the term
"Adjusted Number of Shares" shall be equal to that number of
shares (or fractions of shares) of Common Stock (and/or capital
stock equivalents) equal to the product of (x) the number of
Adjustment Shares and (y) a fraction, the numerator of which is
the number of shares of Common Stock (and/or capital stock
equivalents) available for issuance upon exercise of the Rights
and the denominator of which is the aggregate number of
Adjustment Shares otherwise issuable upon exercise in full of all
Rights (assuming there were sufficient shares of Common Stock
available) (such fraction being referred to as the "Proration
Factor"). The "Adjusted Purchase Price" shall mean the product
of the Purchase Price and the Proration Factor. The Board of
Directors may, but shall not be required to, establish procedures
to allocate the right to receive Common Stock and capital stock
equivalents upon exercise of the Rights among holders of Rights.
(b) If the Company shall fix a record date for the
issuance of rights (other than the Rights), options or warrants
to all holders of Preferred Stock entitling them (for a period
expiring within 45 calendar days after such record date) to
subscribe for or purchase Preferred
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<PAGE>
Stock (or shares having the same or more favorable rights,
privileges and preferences as the Preferred Stock ("equivalent
preferred stock")) or securities convertible into Preferred Stock
or equivalent preferred stock at a price per share of Preferred
Stock or per share of equivalent preferred stock (or having a
conversion price per share, if a security convertible into
Preferred Stock or equivalent preferred stock) less than the then
current market price (as determined in Section 11(d)) per share
of Preferred Stock on such record date, the Purchase Price to be
in effect after such record date shall be determined by
multiplying the Purchase Price in effect immediately prior to
such record date by a fraction, the numerator of which shall be
the number of shares of Preferred Stock outstanding on such
record date, plus the number of shares of Preferred Stock which
the aggregate offering price of the total number of shares of
Preferred Stock and/or equivalent preferred stock so to be
offered (and/or the aggregate initial conversion price of the
convertible securities so to be offered) would purchase at such
current market price per share of Preferred Stock and the
denominator of which shall be the number of shares of Preferred
Stock outstanding on such record date, plus the number of
additional shares of Preferred Stock and/or equivalent preferred
stock to be offered for subscription or purchase (or into which
the convertible securities so to be offered are initially
convertible); provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right be less
than the aggregate par value of the shares of capital stock of
the Company issuable upon the exercise of one Right. In case
such subscription price may be paid in a consideration part or
all of which shall be in a form other than cash, the value of
such consideration shall be determined in good faith by the Board
of Directors of the Company, whose determination shall be
described in a statement filed with the Rights Agent and shall be
binding on the Rights Agent. Shares of Preferred Stock owned by
or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date
is fixed; and in the event that such rights, options or warrants
are not so issued, the Purchase Price shall be adjusted to be the
Purchase Price which would then be in effect if such record date
had not been fixed.
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<PAGE>
(c) If the Company shall fix a record date for the
making of a distribution to all holders of Preferred Stock
(including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing or
surviving corporation) of evidences of indebtedness, cash (other
than a regular quarterly cash dividend out of the earnings or
retained earnings of the Company), assets (other than a dividend
payable in Preferred Stock, but including any dividend payable in
stock other than Preferred Stock) or subscription rights or
warrants (excluding those referred to in Section 11(b)), the
Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the
numerator of which shall be the current market price (as
determined in Section 11(d)) per share of Preferred Stock on such
record date, less the fair market value (as determined in good
faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent) of the
portion of the cash, assets or evidences of indebtedness so to be
distributed or of such subscription rights or warrants
distributable in respect of one share of Preferred Stock and the
denominator of which shall be such current market price per share
of the Preferred Stock; provided, however, that in no event shall
the consideration to be paid upon the exercise of one Right be
less than the aggregate par value of the shares of capital stock
of the Company to be issued upon exercise of one Right. Such
adjustments shall be made successively whenever such a record
date is fixed; and in the event that such distribution is not so
made, the Purchase Price shall again be adjusted to be the
Purchase Price which would then be in effect if such record date
had not been fixed.
(d) (i) For the-purpose of any computation hereunder,
the "current market price" per share of any Security (a
"Security" for the purpose of this Section 11(d)(i)) on any date
shall be deemed to be the average of the daily closing prices per
share of such Security for the 30 consecutive Trading Days (as
such term is hereinafter defined) immediately prior to such date;
provided, however, that in the event that the current per share
market price of the Security is determined during a period
following the announcement by the issuer of such Security of (A) a
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<PAGE>
dividend or distribution on such Security payable in shares of
such Security or securities convertible into such shares or (B)
any subdivision, combination or reclassification of such
Security, and prior to the expiration of 30 Trading Days after
the ex-dividend date for such dividend or distribution, or the
record date for such subdivision, combination or
reclassification, then, and in each such case, the "current
market price" shall be appropriately adjusted to reflect the
current market price per share equivalent of such Security. The
closing price for each day shall be the last sale price, regular
way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in
either case as reported in the principal consolidated transaction
reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the Security is not
listed or admitted to trading on the New York Stock Exchange, as
reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal
national securities exchange on which the Security is listed or
admitted to trading or, if the Security is 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 exchange or market
system then in use, or, if on any such date the Security is not
quoted by any such organization, the average of the closing bid
and asked prices as furnished by a professional market maker
making a market in the Security selected by the Board of
Directors of the Company. If on any such date no market maker is
making a market in the Security, the fair value of such shares on
such date as determined in good faith by the Board of Directors
of the Company shall be used. The term "Trading Day" shall mean
a day on which the principal national securities exchange on
which the shares of Security is listed or admitted to trading is
open for the transaction of business or, if the Security is not
listed or admitted to trading on any national securities
exchange, a Business Day. Subject to Section 11(d)(ii) hereof,
if any Security is not publicly held or so listed or traded, the
"current market price" of such Security shall mean the fair
market value per share determined in good faith by the Board of
Directors of the
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<PAGE>
Company, whose determination shall be described in a statement
filed with the Rights Agent and shall be binding on the Rights
Agent.
(ii) For the purpose of any computation hereunder,
the "current market price" per share (or one one-thousandth of a
share) of Preferred Stock shall be determined in the same manner
as set forth above in clause (i) of this Section 11(d). If the
current market price per share (or one one-thousandth of a share)
of Preferred Stock cannot be determined in the manner provided
above or if the Preferred Stock is not publicly held or listed or
traded in a manner described in clause (i) of this Section 11(d),
the "current market price" per share of Preferred Stock shall be
conclusively deemed to be an amount equal to one-thousand (as
such number may be appropriately adjusted for such events as
stock splits, stock dividends and recapitalizations or similar
transactions with respect to the Common Stock occurring after the
date of this Agreement) multiplied by the current market price
per share of the Common Stock and the "current market price" per
one one-thousandth of a share of Preferred Stock shall be equal
to the current market price per share of the Common Stock (as
appropriately adjusted). If neither the Common Stock nor the
Preferred Stock is publicly held or so listed or traded, "current
market price" per share shall mean the fair value per share as
determined in good faith by the Board of Directors of the
Company, whose determination shall be described in a statement
filed with the Rights Agent and shall be binding on the Rights
Agent.
(e) Anything herein to the contrary notwithstanding,
no adjustment in the-Purchase Price shall be required unless such
adjustment would require an increase or decrease of at least 1%
in the Purchase Price; provided, however, that any adjustments
which by reason of this Section 11(e) are not required to be made
shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made
to the nearest cent or to the nearest one one-thousandth of a
share of Preferred Stock or one ten-thousandth of a share of
Common Stock or other share or security, as the case may be.
Notwithstanding the first sentence of this Section 11(e), any
adjustment required by this Section 11 shall be made no later
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<PAGE>
than the earlier of (i) three years from the date of the
transaction which mandates such adjustment or (ii) the Final
Expiration Date.
(f) If as a result of any provision of Section 11(a)
or Section 13(a) hereof, the holder of any Right thereafter
exercised shall become entitled to receive any shares of capital
stock of the Company other than Preferred Stock, thereafter the
number of such other shares so receivable upon exercise of any
Right shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the
provisions with respect to the shares contained in Section 11(a)
through (c), inclusive, and the provisions of Sections 7, 9, 10,
13 and 15 hereof with respect to the Preferred Stock shall apply
on like terms to any such other shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder
shall evidence the right to purchase, at the adjusted Purchase
Price, the number of one one-thousandths of a share of Preferred
Stock purchasable from time to time hereunder upon exercise of
the Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its
election as provided in Section 11(i) hereof, upon each
adjustment of the Purchase Price as a result of the calculations
made in Section 11(b) and (c) hereof, each Right outstanding
immediately prior to the making of such adjustment shall
thereafter evidence the right to purchase, at the adjusted
Purchase Price, that number of one one-thousandths of a share of
Preferred Stock (calculated to the nearest one-ten-thousandth)
obtained by (i) multiplying (x) the number of one one-thousandths
of a share of Preferred Stock covered by a Right immediately
prior to this adjustment of the Purchase Price by (y) the
Purchase Price in effect immediately prior to such adjustment of
the Purchase Price and (ii) dividing the product so obtained by
the Purchase Price in effect immediately after such adjustment of
the Purchase Price.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights,
in substitution for any adjustment in the number
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<PAGE>
of one one-thousandths of a share of Preferred Stock purchasable
upon the exercise of a Right. Each of the Rights outstanding
after such adjustment of the number of Rights shall be
exercisable for the number of one one-thousandths of a share of
Preferred Stock for which a Right was exercisable immediately
prior to such adjustment. Each Right held of record prior to
such adjustment of the number of Rights shall become that number
of Rights (calculated to the nearest one ten-thousandth) obtained
by dividing the Purchase Price in effect immediately prior to
adjustment of the Purchase Price by the Purchase Price in effect
immediately after adjustment of the Purchase Price. The Company
shall make a public announcement of its election to adjust the
number of Rights, indicating the record date for the adjustment,
and, if known at the time, the amount of the adjustment to be
made. This record date may be the date on which the Purchase
Price is adjusted or any day thereafter, but, if the Rights
Certificates have been issued, shall be at least 10 days later
than the date of the public announcement. If Rights Certificates
have been issued, upon each adjustment of the number of Rights
pursuant to this Section 11(i), the Company shall, as promptly as
practicable, cause to be distributed to holders of record of
Rights Certificates on such record date Rights Certificates
evidencing, subject to Section 15 hereof, the additional Rights
to which such holders shall be entitled as a result of such
adjustment, or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and
replacement for the Rights Certificates held by such holders
prior to the date of adjustment, and upon surrender thereof, if
required by the Company, new Rights Certificates evidencing all
the Rights to which such holders shall be entitled after such
adjustment. Rights Certificates so to be distributed shall be
issued, executed and countersigned in the manner provided for
herein (and may bear, at the option of the Company, the adjusted
Purchase Price) and shall be registered in the names of the
holders of record of Rights Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the
Purchase Price or the number of shares of Preferred Stock
issuable upon the exercise of the Rights, the Rights Certificates
theretofore and thereafter issued may continue to express the
Purchase Price per
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<PAGE>
share and the number of shares which were expressed in the
initial Rights Certificates issued hereunder.
(k) Before taking any action that would cause an
adjustment reducing the Purchase Price below the then par value,
if any, of the shares of Preferred Stock, Common Stock or other
securities issuable upon exercise of the Rights, the Company
shall take any corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and
legally issue such number of fully paid and nonassessable one one-
thousandths of a share of Preferred Stock, Common Stock or other
securities at such adjusted Purchase Price. If upon any exercise
of the Rights, a holder is to receive a combination of Common
Stock, and capital stock equivalents, a portion of the
consideration paid upon such exercise, equal to at least the then
par value of a share of Common Stock of the Company shall be
allocated as the payment for each share of Common Stock of the
Company so received.
(1) In any case in which this Section 11 shall require
that an adjustment in the Purchase Price be made effective as of
a record date for a specified event, the Company may elect to
defer until the occurrence of such event the issuance to the
holder of any Right exercised after such record date the number
of one one-thousandths of a share of Preferred Stock, Common
Stock or other capital stock or securities of the Company, if
any, issuable upon such exercise over and above the number of one
one-thousandths of a share of Preferred Stock, Common Stock or
other capital stock or securities of the Company, if any,
issuable upon such exercise on the basis of the Purchase Price in
effect prior to such adjustment; provided, however, that the
Company shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder's right to receive
such additional shares upon the occurrence of the event requiring
such adjustment.
(m) Anything to the contrary in this Section 11
notwithstanding, the Company shall be entitled to make such
reductions in the Purchase Price, in addition to those
adjustments expressly required by this Section 11, as and to the
extent that it in its sole discretion shall determine to be
advisable in order that any (i) consolidation or subdivision of
the Preferred
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<PAGE>
Stock, (ii) issuance wholly for cash of any shares of Preferred
Stock at less than the current market price, (iii) issuance
wholly for cash of shares of Preferred Stock or securities which
by their terms are convertible into or exchangeable for shares of
Preferred Stock, (iv) stock dividends or (v) issuance of rights,
options or warrants referred to hereinabove in this Section 11,
hereafter made by the Company to holders of its Preferred Stock
shall not be taxable to such shareholders.
(n) The exercise of Rights under Section 11(a)(ii)
shall only result in the loss of rights under Section 11(a)(ii)
to the extent so exercised and shall not otherwise affect the
rights represented by the Rights under this Rights Agreement,
including the rights represented by Section 13.
Section 12. Certificate of Adjusted Purchase Price or
-----------------------------------------
Number of Shares. Whenever an adjustment is made as provided in
- ----------------
Sections 11 and 13 hereof, the Company shall (a) promptly prepare
a certificate setting forth such adjustment and a brief statement
of the facts accounting for such adjustment, (b) promptly file
with the Rights Agent and with each transfer agent for the
Preferred Stock and the Common Stock a copy of such certificate
and (c) mail a brief summary thereof to each holder of a Rights
Certificate in accordance with Section 27 hereof. The Rights
Agent shall be fully protected in relying on any such certificate
and on any adjustment therein contained, and shall not be
obligated or responsible for calculating any adjustment, nor
shall it be deemed to have knowledge of such an 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, on or following the Stock
Acquisition Date, directly or indirectly, (x) the Company shall
consolidate with, or merge with and into, any other Person,
(y) any Person shall consolidate with the Company 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 merger, all or part of the shares of Common
Stock shall be changed into or exchanged for stock or other
securities of any other Person or cash or any other property or all
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holders of shares of Common Stock are not treated alike or
following the merger or consolidation the holders of Common Stock
immediately prior to the transaction do not hold in the same
proportion all of the Voting Power of the corporation surviving
the transaction or, or (z) the Company shall sell, mortgage or
otherwise transfer (or one or more of its Subsidiaries shall
sell, mortgage or otherwise transfer), in one transaction or a
series of related transactions, assets or earning power
aggregating more than 50% of the assets or earning power of the
Company and its Subsidiaries (taken as a whole) to any other
Person, then, and in each such case, proper provision shall be
made so that (i) following the Distribution Date, each holder of
a Right, except as provided in Section 7(e) hereof, shall
thereafter have the right to receive, upon the exercise thereof
at a price equal to the then current Purchase Price in accordance
with the terms of this Agreement such number of shares of freely
tradeable Common Stock of the Principal Party (as hereinafter
defined), free and clear of liens, rights of call or first
refusal, encumbrances or other adverse claims, as shall be equal
to the result obtained by (x) multiplying the then current
Purchase Price by the number of one one-thousandths of a share of
Preferred Stock for which a Right is then exercisable (without
taking into account any adjustment previously made pursuant to
Section 11(a)(ii) hereof) and dividing that product by (y) 50% of
the then current market price per share of the Common Stock of
such Principal Party (determined pursuant to Section 11(d)
hereof) on the date of consummation of such Section 13 Event;
(ii) such Principal Party shall thereafter be liable for, and
shall assume, by virtue of such Section 13 Event, all the
obligations and duties of the Company pursuant to this Agreement;
(iii) the term "Company" shall thereafter be deemed to refer to
such Principal Party, it being specifically intended that the
provisions of Section 11 hereof shall apply 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 Section 9
hereof) in connection with the consummation of any such
transaction 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.
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<PAGE>
(b) "Principal Party" shall mean
(i) in the case of any transaction described in
clause (x) or (y) of the first sentence of this Section 13(a),
the Person that is the issuer of any securities into which shares
of Common Stock of the Company are converted in such merger or
consolidation, and if no securities are so issued, the Person
that is the other party to such merger or consolidation
(including, if applicable, the Company, if it is the surviving
corporation); and
(ii) in the case of any transaction described in
clause (z) of the first sentence of this 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; provided, however, that in any of the foregoing
cases, (1) 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 or Affiliate of another
Person, "Principal Party" shall refer to such other Person; (2)
in case such Person is a Subsidiary, directly or indirectly, or
Affiliate of more than one Person, the shares of Common Stock of
two or more of which are and have been so registered, "Principal
Party" shall refer to whichever of such Persons is the issuer of
the Common Stock having the greatest aggregate market value; and
(3) in case such Person is owned, directly or indirectly, by a
joint venture formed by two or more Persons that are not owned,
directly or indirectly, by the same Person, the rules set forth
in (1) and (2) above shall apply to each of the chains of
ownership having an interest in such joint venture as if such
party were a "Subsidiary" of both or all of such joint venturers
and the Principal Parties in each such chain shall bear the
obligations set forth in this Section 13 in the same ratio as
their direct or indirect interests in such Person bear to the
total of such interests.
(c) The Company shall not consummate any such
consolidation, merger, sale or transfer unless prior thereto the
Company and each Principal Party and each other Person who may
become a Principal Party as a result of a Section 13 Event shall
have a sufficient number of its authorized shares of its Common
Stock that have not been issued or reserved for issuance to
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permit the exercise in full of the Rights in accordance with this
Section 13 and unless prior thereto the Company and such
Principal Party shall have executed and delivered to the Rights
Agent a supplemental agreement providing for the terms set forth
in paragraphs (a) and (b) of this Section 13 and further
providing that, as soon as practicable after the date of any
Section 13 Event, the Principal Party at its own expense shall:
(i) prepare and file a registration statement
under the Act with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form,
will use its best efforts to cause such registration statement to
become effective as soon as practicable after such filing and
will use its best efforts to cause such registration statement to
remain effective (with a prospectus at all times meeting the
requirements of the Act) until the Expiration Date;
(ii) use its best efforts to qualify or register
the Rights and the securities purchasable upon exercise of the
Rights under the blue sky laws of such jurisdictions as may be
necessary or appropriate; and
(iii) deliver to holders of the Rights
historical financial statements for the Principal Party and each
of its Affiliates which comply in all material respects with the
requirements for registration on Form 10 under the Exchange Act.
The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other transfers.
The rights under this Section 13 shall be in addition to the
rights to exercise Rights and adjustments under Section 11(a)(ii)
and shall survive any exercise thereunder.
(d) Notwithstanding anything in this Agreement to the
contrary, the provisions of this Section 13 shall not be
applicable to a transaction described in clauses (x) and (y) of
Section 13(a) if: (i) such transaction is consummated with a
Person or Persons who acquired shares of Common Stock pursuant to
a Permitted Offer (or a wholly owned Subsidiary of any such
Person or Persons); (ii) the price per share of Common Stock
offered in such transaction is not less than the price per share
paid to all holders of Common Stock whose shares
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were purchased pursuant to such Permitted Offer; and (iii) the
form of consideration offered in such transaction is the same as
the form of consideration paid pursuant to such Permitted Offer.
Upon consummation of any transaction contemplated by this
subsection (d), all Rights hereunder shall expire.
Section 14. Additional Covenants.
--------------------
(a) After the Distribution Date, the Company covenants
and agrees that it shall not (i) consolidate with any other
Person (other than a Subsidiary of the Company in a transaction
which does not violate Section 14(b) hereof); (ii) merge with or
into any other Person (other, than a Subsidiary of the Company in
a transaction which does not violate Section 14(b) hereof); or
(iii) sell or transfer (or permit any Subsidiary to sell or
transfer), in one transaction, or a series of related
transactions, assets or earning power aggregating more than 50%
of the assets or earning power of the Company and its
Subsidiaries (taken as a whole), to any other Person or Persons
(other than the Company and/or any of its Subsidiaries in one or
more transactions each of which does not violate Section 14(b)
hereof), if (x) at the time of or immediately after such
consolidation, merger, sale or transfer there are any charter or
by-law provisions or any rights, warrants or other instruments
outstanding or agreements in effect or other actions taken, which
would diminish or otherwise eliminate the benefits intended to be
afforded by the Rights or (y) prior to, simultaneously with or
immediately after such consolidation, merger or sale, the
shareholders of the Person who constitutes, or would constitute,
the "Principal Party" for purposes of Section 13 hereof shall
have received a distribution of Rights previously owned by such
Person or any of its Affiliates and Associates. The Company
shall not consummate any such consolidation, merger, sale or
transfer unless prior thereto the Company and such other Person
shall have executed and delivered to the Rights Agent a
supplemental agreement evidencing compliance with this
subsection.
(b) The Company covenants and agrees that, after the
Distribution Date, it will not, except as permitted by Section 24
or Section 28 hereof, take (or permit any Subsidiary to take) any
action the purpose or effect of which is to, or if at the time
such action is taken it is
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<PAGE>
reasonably foreseeable that the effect of such action is to
materially diminish or otherwise eliminate the benefits intended
to be afforded by the Rights.
Section 15. Fractional Rights and Fractional Shares.
---------------------------------------
(a) The Company shall not be required to issue
fractions of Rights or to distribute Rights Certificates which
evidence fractional Rights. In lieu of such fractional Rights,
there shall be paid to the registered holders of the Rights
Certificates with regard to which such fractional Rights would
otherwise be issuable, an amount in cash equal to the same
fraction of the current market value of a whole Right. For the
purposes of this Section 15(a), the current market value of a
whole Right shall be the closing price of the Rights for the
Trading Day immediately prior to the date on which such
fractional Rights would have been otherwise issuable. The
closing price of the Rights for any day shall be the last sale
price, regular way, or, in case no such sale takes place on such
day, the average of the closing bid and asked prices, regular
way, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock Exchange or, if the
Rights are not listed or admitted to trading on the New York
Stock Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities listed on
the principal national securities exchange on which the Rights
are listed or admitted to trading or, if the Rights are not
listed or admitted to trading on any national securities
exchange, the last quoted price or, if not so quoted, the average
of the high bid and low asked prices in the over-the-counter
market, as reported by NASDAQ or such other system then in use.
or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the
Rights selected by the Board of Directors of the Company. If on
any such date no such market-maker is making a market in the
Rights the fair value of the Rights on such date as determined in
good faith by the Board of Directors of the Company shall be used
and shall be binding on the Rights Agent.
(b) The Company shall not be required to issue
fractions of shares of Preferred Stock (other than fractions
which are one one-thousandth or integral multiples of one one-
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<PAGE>
thousandth of a share of Preferred Stock) upon exercise of the
Rights or to distribute certificates which evidence fractional
shares of Preferred Stock (other than fractions which are one one-
thousandth or integral multiples of one one-thousandth of a share
of Preferred Stock). Fractions of shares of Preferred Stock in
integral multiples of one one-thousandth of a share of Preferred
Stock may, at the election of the Company, be evidenced by
depositary receipts, pursuant to an appropriate agreement between
the Company and a depositary selected by it, provided that such
agreement shall provide that the holders of such depositary
receipts shall have all the rights, privileges and preferences to
which they are entitled as beneficial owners of the shares of
Preferred Stock represented by such depositary receipts. In lieu
of fractional shares of Preferred Stock that are not one one-
thousandth or integral multiples of one one-thousandth of a share
of Preferred Stock, the Company may pay to the registered holders
of Rights Certificates at the time such Rights are exercised as
herein provided an amount in cash equal to the same fraction of
the current market value of one one-thousandth of a share of
Preferred Stock. For purposes of this Section 15(b), the current
market value of one one-thousandth of a share of Preferred Stock
shall be one one-thousandth of the closing price of a share of
Preferred Stock (as determined pursuant to Section 11(d)(ii)
hereof) for the Trading Day immediately prior to the date of such
exercise.
(c) Following the occurrence of one of the
transactions or events specified in Section 11 giving rise to the
right to receive shares of Common Stock, capital stock
equivalents (other than Preferred Stock) or other securities upon
the exercise of a Right, the Company shall not be required to
issue fractions of shares or units of such shares of Common
Stock, capital stock equivalents or other securities upon
exercise of the Rights or to distribute certificates which
evidence fractions of shares of Common Stock, capital stock
equivalents or other securities. In lieu of fractional shares or
units of such shares of Common Stock, capital stock equivalents
or other securities, the Company may pay to the registered
holders of Rights Certificates at the time such Rights are
exercised as herein provided an amount in cash equal to the same
fraction of the current market value of a share or unit of such
shares of Common Stock, capital stock equivalent or other
securities. For purposes of this Section 15(c), the current
market value shall be
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determined in the manner set forth in Section 11(d) hereof for
the Trading Day immediately prior to the-date of such exercise
and, if such capital stock equivalent is not traded, each such
capital stock equivalent shall have the value of one one-
thousandth of a share of Preferred Stock.
(d) Except as otherwise expressly provided herein, the
holder of a Right by the acceptance of the Right expressly waives
the right to receive any fractional Right or any fractional share
upon exercise of a Right.
Section 16. Rights of Action. All rights of action in
----------------
respect of this Agreement, excepting the rights of action given
to the Rights Agent under Section 19 hereof, are vested in the
respective registered holders of the Rights Certificates (and,
prior to the Distribution Date, the registered holders of the
Common Stock); and any registered holder of any Rights
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 Rights 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 Rights Certificate in the manner provided in such Rights
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 shall be entitled to specific performance of the obligations
hereunder and injunctive relief against actual or threatened
violations of the obligations hereunder of any Person subject to
this Agreement. Holders of Rights shall be entitled to recover
the reasonable costs and expenses, including attorneys' fees,
incurred by them in any bona fide action to enforce the
provisions of this Agreement, provided such holders prevail in
such action either by judicial determination or settlement.
Section 17. Agreement of Rights Holders. Every holder of a
---------------------------
Right by accepting the same consents and agrees with the Company
and the Rights Agent and with every other holder of a Right that:
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(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of Common
Stock;
(b) after the Distribution Date, the Rights
Certificates are transferable only on the registry books of the
Rights Agent if surrendered at the principal office of the Rights
Agent, duly endorsed or accompanied by a proper instrument of
transfer and with the appropriate form fully executed; and
(c) subject to Section 6 and Section 7(f) hereof, the
Company and the Rights Agent may deem and treat the person in
whose name the Rights Certificate (or, prior to the Distribution
Date, the associated Common Stock certificate) is registered as
the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the
Rights Certificates or the associated Common Stock certificate
made by anyone other than the Company or the Rights Agent) for
all purposes whatsoever, and neither the Company nor the Rights
Agent shall be affected by any notice to the contrary; and
notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability
to any holder of a Right or a beneficial interest in a Right or
other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or
permanent injunction or other order, decree, or ruling issued by
a court of competent jurisdiction or by a governmental,
regulatory or administrative agency or commission, or any
statute, rule, regulation or executive order promulgated or
enacted by any governmental authority, prohibiting or otherwise
restraining performance of such obligation.
Section 18. Rights Certificate Holder Not Deemed a
--------------------------------------
Stockholder. No holder, as such, of any Rights Certificate shall
- -----------
be entitled to vote, receive dividends or be deemed for any
purpose the holder of the shares of Preferred Stock, Common Stock
or any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby, nor
shall anything contained herein or in any Rights Certificate be
construed to confer upon the holder of any Rights Certificate, as
such, any of the rights of a shareholder of the Company or any
right to vote for the election of directors or upon any matter
submitted to shareholders at any
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<PAGE>
meeting thereof, or to give or withhold consent to any corporate
action, or to receive notice of meetings or other actions
affecting shareholders (except as provided in Section 25 hereof),
or to receive dividends or other distributions or to exercise any
preemptive or subscription rights, or otherwise, until the Right
or Rights evidenced by such Rights Certificate shall have been
exercised in accordance with the provisions hereof.
Section 19. Concerning the Rights Agent. The Company
---------------------------
agrees to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder as agreed, and, from time to
time, on demand of the Rights Agent, its reasonable expenses and
counsel fees and disbursements and other disbursements incurred
in the administration and execution of this Agreement and the
exercise and performance of its duties hereunder. The Company
also agrees to indemnify the Rights Agent for, and to hold it
harmless against, any loss, liability, or expense, incurred
without negligence, bad faith or willful misconduct on the part
of the Rights Agent, for anything done or omitted by the Rights
Agent in connection with the acceptance and administration of
this Agreement, including the costs and expenses of defending
against any claim of liability arising therefrom, directly or
indirectly. The indemnity provided for herein shall survive the
expiration of the Rights, the termination of this Agreement, and
the resignation or removal of the Rights Agent. The costs and
expenses of enforcing the right of indemnification shall also be
paid by the Company.
The Rights Agent may conclusively rely upon and shall be
protected and shall incur no liability for or in respect of any
action taken, suffered or omitted by it in connection with its
administration of this Agreement in reliance upon any Rights
Certificate or certificate for Common Stock (or for other
securities of the Company), instrument of assignment or transfer,
power of attorney, endorsement, affidavit, letter, notice,
direction, consent, certificate, statement, or other paper or
document believed by it to be genuine and to be signed, executed
and, where necessary, verified or acknowledged, by the proper
Person or Persons set forth in Section 21. Notwithstanding
anything in this Agreement to the contrary, in no event shall the
Rights Agent be liable for special, indirect or consequential
loss or damage of any kind whatsoever (including
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<PAGE>
but not limited to lost profits), even if the Rights Agent has
been advised of the likelihood of such loss or damage and
regardless of the form of the action.
Section 20. Merger or Consolidation or Change of Name of
--------------------------------------------
Rights Agent. Any corporation into which the Rights Agent or any
- ------------
successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to the
stock transfer or all or substantially all of the corporate trust
business of the Rights Agent or any successor Rights Agent, shall
be the successor to the Rights Agent under this Agreement without
the execution or filing of any paper or any further act on the
part of any of the parties hereto, provided that such corporation
would be eligible for appointment as a successor Rights Agent
under the provisions of Section 22 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 Rights Certificates so countersigned; and in
case at that time any of the Rights Certificates shall not have
been countersigned, any successor Rights Agent may countersign
such Rights Certificates either in the name of the predecessor or
in the name of the successor Rights Agent; and in all such cases
such Rights Certificates shall have the full force provided in
the Rights Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall be
changed and at such time any of the Rights Certificates shall
have been countersigned but not delivered, the Rights Agent may
adopt the countersignature under its prior name and deliver
Rights Certificates so countersigned; and in case at that time
any of the Rights Certificates shall not have been countersigned,
the Rights Agent may countersign such Rights Certificates either
in its prior name or in its changed name; and in all such cases
such Rights Certificates shall have the full force provided in
the Rights Certificates and in this Agreement.
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<PAGE>
Section 21. Duties of Rights Agent. The Rights Agent
----------------------
undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, and no implied duties or
obligations shall be read into this Agreement against the Rights
Agent, all of which the Company and the holders of Rights
Certificates, by their acceptance thereof, shall be bound:
(a) Before the Rights Agent acts or refrains from
acting, the Rights Agent may consult with legal counsel selected
by it (who may be legal counsel for the Company), and the opinion
of such counsel shall be full and complete authorization and
protection to the Rights Agent as to any action taken or omitted
by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under
this Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter (including, without limitation,
the identity of an Acquiring Person) be proved or established by
the Company prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively
proved and established by a certificate signed by any one of the
Chairman of the Board, any Vice Chairman of the Board, its
President, the Chief Executive Officer, any Vice President, the
Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary of the Company and delivered to the Rights
Agent; and such certificate shall be full authorization to the
Rights Agent for any action taken or suffered in good faith by it
under the provisions of this Agreement in reliance upon such
certificate.
(c) The Rights Agent shall be liable hereunder only
for its own negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained in
this Agreement or in the Rights Certificates (except as to the
fact that it has countersigned the Rights Certificates) 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.
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<PAGE>
(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 Rights Certificate (except its countersignature
thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement
or in any Rights Certificate; nor shall it be responsible for any
change in the exercisability of the Rights (including the Rights
becoming void pursuant to Section 7(e) hereof), or any adjustment
required under the provisions of Section 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 Rights Certificates after actual
notice of any such adjustment); nor shall it be responsible for
any determination by the Board of Directors of the Company of the
current market value of the Rights or Preferred Stock or Common
Stock pursuant to the provisions of Section 15 hereof; nor shall
it by any act hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any shares of
Preferred Stock, shares of Common Stock or other securities to be
issued pursuant to this Agreement or any Rights Certificate or as
to whether any shares of Preferred Stock, shares of Common Stock
or other securities will, when so 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 and certificates delivered pursuant to any
provision hereof from any one of the Chairman of the Board, any
Vice Chairman of the Board, the President, the Chief Executive
Officer, any Vice President, the Secretary, any Assistant
Secretary, the Treasurer or any Assistant Treasurer of the
Company, and is authorized to apply to
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<PAGE>
such officers for advice or instructions in connection with its
duties, and it shall not be liable for any action taken or
suffered to be taken by it in good faith in accordance with
instructions of any such officer. Any application by the Rights
Agent for written instructions from the Company may, at the
option of the Rights Agent, set forth in writing any action
proposed to be taken or omitted by the Rights Agent under this
Rights Agreement and the date on or after which such action shall
be taken or such omission shall be effective. The Rights Agent
shall not be liable for any action taken by, or omission of, the
Rights Agent in accordance with a proposal included in any such
application on or after the date specified in such application
(which date shall not be less than ten Business Days after the
date any officer of the Company actually receives such
application, unless any such officer shall have consented in
writing to an earlier date) unless, prior to taking any such
action (or the effective date in the case of an omission), the
Rights Agent shall have received written instructions in response
to such application not to take or omit the proposed action
and/or 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 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, omission, default, neglect or misconduct of any such
attorneys or agents or for any loss to the Company or to the
holders of the Rights resulting from any such act, omission,
default, neglect or misconduct, provided reasonable care was
exercised in the selection and continued employment thereof.
(j) No provision of this Agreement shall require the
Rights Agent to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its
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<PAGE>
duties hereunder or in the exercise of its rights hereunder if
there shall be reasonable grounds for believing that repayment of
such funds or adequate indemnification against such risk or
liability is not reasonably assured to it.
(k) If, with respect to any Rights Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate attached to the form of assignment or form of
election to purchase, as the case may be, has either not been
completed or indicates an affirmative response to clause 1 and/or
2 thereof, the Rights Agent shall not take any further action
with respect to such requested exercise of transfer without first
consulting with the Company.
(l) The Rights Agent shall not be required to take
notice or be deemed to have notice of any fact, event or
determination (including, without limitation, any dates or events
defined in this Agreement or the designation of any Person as an
Acquiring Person, Affiliate or Associate) under this Agreement
unless and until the Rights Agent shall be specifically notified
in writing by the Company, or has actual knowledge from the
Company, of such fact, event or determination.
Section 22. 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 Preferred Stock by registered or certified mail, and,
at the expense of the Company, to the holders of the Rights
Certificates by first-class mail. The Company may remove the
Rights Agent or any successor Rights Agent upon 30 days' notice
in writing, mailed to the Rights Agent or successor Rights Agent,
as the case may be, and to each transfer agent of the Common
Stock and Preferred Stock by registered or certified mail, and to
the holders of the Rights Certificates by first-class mail. If
the Rights Agent shall resign or be removed or shall otherwise
become incapable of acting, the Company shall appoint a successor
to the Rights Agent. If the Company shall fail to make such
appointment within a period of 30 days after giving notice of
such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated
Rights Agent or by the holder of a Rights Certificate (who shall,
with such notice, submit his
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Rights Certificate for inspection by the Company), then the
registered holder of any Rights Certificate may apply to any
court of competent jurisdiction for the appointment of a new
Rights Agent. Any successor Rights Agent, whether appointed by
the Company or by such a court, shall be (a) a corporation
organized and doing business under the laws of the United States
or of any state of the United States, in good standing, so long
as such corporation (i) complies with the applicable rules and
requirements of the New York Stock Exchange, as such rules and
requirements may be amended or modified from time to time, (ii)
is authorized under such laws to exercise stock transfer or
corporate trust powers and (iii) is subject to supervision or
examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined capital and
surplus of at least $50,000,000 (or such lower number as approved
by the Board) or (b) an affiliate of a corporation described in
clause (a) of this sentence. 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 to the registered holders of the Rights Certificates.
Failure to give any notice provided for in this Section 22,
however, or any defect therein, shall not affect the legality or
validity of the resignation or removal of the Rights Agent or the
appointment of the successor Rights Agent, as the case may be.
Section 23. Issuance of New Rights Certificates.
-----------------------------------
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new
Rights Certificates evidencing Rights in such form as may be
approved by its Board of Directors to reflect any adjustment or
change in the Purchase Price per share and the number or kind or
class of shares or other securities or property purchasable under
the Rights Certificates made in
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<PAGE>
accordance with the provisions of this Agreement. In addition,
in connection with the issuance or sale of shares of Common Stock
following the Distribution Date and prior to the Expiration Date,
the Company (a) shall with respect to shares of Common Stock so
issued or sold pursuant to the exercise of stock options or under
any employee plan or arrangement, or upon the exercise,
conversion or exchange of securities, notes or debentures issued
by the Company, and (b) may, in any other case, if deemed
necessary or appropriate by the Board of Directors of the
Company, issue Right Certificates representing the appropriate
number of Rights in connection with such issuance or sale;
provided, however, that (i) the Company shall not be obligated to
issue any such Right Certificates if, and to the extent that, the
Company shall be advised by counsel that such issuance would
create a significant risk of material adverse tax consequences to
the Company or the Person to whom such Right Certificate would be
issued, and (ii) no Right Certificate shall be issued if, and to
the extent that, appropriate adjustment shall otherwise have been
made in lieu of the issuance thereof.
Section 24. Redemption and Termination.
--------------------------
(a) (i) The Board of Directors of the Company may, at
its option, at any time prior to the earlier of (x) the Stock
Acquisition Date or (y) 5:00 P.M. (Chicago time) on the Final
Expiration Date, redeem all but not less than all of the then
outstanding Rights at a redemption price of $.01 per Right, as
such amount may be appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the
date hereof (such redemption price being hereinafter referred to
as the "Redemption Price"). The Company may, at its option, pay
the Redemption Price either in shares of Common Stock (based on
the "current market price" per share, as defined in Section
11(d)(i) hereof, of the shares of Common Stock at the time of
redemption) or cash; provided that if the Company elects to pay
the Redemption Price in shares of Common Stock, the Company shall
not be required to issue any fractional shares of Common Stock
and the number of shares of Common Stock issuable to each holder
of Rights shall be rounded down to the next whole share.
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<PAGE>
(ii) In addition, the Board of Directors of the
Company may at its option, at any time following the Stock
Acquisition Date and the expiration of the period during which
the rights of holders of Rights pursuant to Section 11(a)(ii)
hereof may be exercised as a result of the occurrence of such
Stock Acquisition Date but prior to any Section 13 Event, redeem
all but not less than all of the then outstanding Rights at the
Redemption Price in connection with any such event in which all
holders of Common Stock are treated alike and not involving an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person or any Person in which the Acquiring Person or an
Affiliate or Associate of an Acquiring Person has an interest, or
any other Person acting directly or indirectly on behalf of or in
concert with any such Acquiring Person, Associate or Affiliate
(other than involvement by an Acquiring Person, Affiliate,
Associate or such other Person solely as a holder of shares of
Common Stock (of the Company) being treated like all other such
holders) or following the occurrence of an event set forth in,
and the expiration of any period during which the holder of
Rights may exercise the rights under, Section 11(a)(ii) if and
for as long as the Acquiring Person is not thereafter the
Beneficial Owner of securities representing fifteen percent or
more of the voting power of all securities of the Company
generally entitled to vote for the election of directors of the
Company.
(b) In the case of a redemption permitted under
Section 24(a)(i), immediately upon the date for redemption set
forth (or determined in the manner specified in) in a resolution
of the Board of Directors of the Company ordering the redemption
of the Rights, evidence of which shall have been filed with the
Rights Agent 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 for each Rights so held. In the
case of a redemption permitted only under Section 24(a)(ii),
evidence of which shall have been filed with the Rights Agent,
the right to exercise the Rights will terminate and represent
only the right to receive the Redemption Price upon the later of
ten Business Days following the giving of such notice or the
expiration of any period during which the rights under Section
11(a)(ii) may be exercised. The Company shall promptly give
public notice of any such redemption; provided,
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<PAGE>
however, that the failure to give, or any defect in, any such
notice shall not affect the validity of such redemption. Within
ten days after the action of the Board of Directors ordering any
such redemption of the Rights, the Company shall give notice of
such redemption to the Rights Agent and the holders of the then
outstanding Rights by mailing such notice to the Rights Agent and
to all such holders at their last addresses as they appear upon
the registry books of the Transfer Agent for the Common Stock.
Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice.
Each such notice of redemption will state the method by which the
payment of the Redemption Price will be made. Neither the
Company nor any of its Affiliates or Associates may redeem,
acquire or purchase for value any Rights at any time in any
manner other than that specifically set forth in this Section 24
and other than in connection with the purchase of Common Stock
prior to the Distribution Date.
(c) In the case of a redemption permitted under
Section 24(a)(i) or (ii), the Company may, at its option,
discharge all of its obligations with respect to the Rights by
(i) issuing a press release announcing the manner of redemption
of the Rights in accordance with this Agreement and (ii) mailing
payment of the Redemption Price to the registered holders of the
Rights at their last addresses as they appear on the registry
books of Transfer Agent of the Common Stock, and upon such
action, all outstanding Rights Certificates shall be null and
void without any further action by the Company.
Section 25. Exchange.
--------
(a) The Board of Directors of the Company may, at its
option, at any time after any Person becomes an Acquiring Person,
exchange all or part of the then outstanding and exercisable
Rights (which shall not include Rights that have become void
pursuant to the provisions of Section 7(e) and 11(a)(ii) hereof)
for Common Stock of the Company at an exchange ratio of one
Common Stock per Right, appropriately adjusted to reflect any
stock split, stock dividend, recapitalization or similar
transaction involving either the Common Stock or the Preferred
Stock occurring after the date hereof (such exchange ratio being
hereinafter referred to as the "Exchange Ratio").
Notwithstanding the foregoing, the Board of Directors shall not be
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empowered to effect such exchange at any time after any Person
(other than the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or any such Subsidiary, any
entity holding Common Stock for or pursuant to the terms of any
such plan or any trustee, administrator or fiduciary of such a
plan), together with all Affiliates and Associates of such
Person, becomes the Beneficial Owner of 50% or more of the Common
Stock then outstanding.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the exchange of any Rights
pursuant to Section 25(a) hereof and without any further action
and without any notice, the right to exercise such rights shall
terminate and the only right thereafter of a holder of such
Rights shall be to receive that number of shares of Common Stock
equal to the number of such rights held by such holder multiplied
by the Exchange Ratio. The Company shall promptly give public
notice of any such exchange; provided, however, that the failure
to give, or any defect in, such notice shall not affect the
validity of such exchange. The Company promptly shall mail a
notice of any such exchange to all of the holders of such Rights
at their last addresses as they appear upon the registry books of
the Rights Agent. 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 exchange will state the
method by which the exchange of the Common Stock for Rights 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
Sections 7(e) and 11(a)(ii) hereof) held by each holder of
Rights.
(c) In any exchange pursuant to this Section 25, the
Company, at its option, may substitute Preferred Stock (or
equivalent preferred stock, as such term is defined in Section
11(b) hereof) for some or all of the Common Stock exchangeable
for Rights, at the initial rate of one one-thousandth of a share
of Preferred Stock (or equivalent preferred share) 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
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<PAGE>
delivered in lieu of each share of Common Stock shall have the
same voting rights as one share of Common Stock.
(d) The Board shall not authorize any exchange
transaction referred to in Section 25(a) hereof unless at the
time such exchange is authorized there shall be sufficient Common
Stock and/or Preferred Stock issued but not outstanding, or
authorized but unissued, to permit the exchange of Rights as
contemplated in accordance with this Section 25.
Section 26. Notice of Certain Events. In case the Company
------------------------
shall propose (i) to pay any dividend payable in stock of any
class to the holders of Preferred Stock or to make any other
distribution to the holders of Preferred Stock (other than a
regular quarterly cash dividend out of earnings or retained
earnings of the Company) or (ii) to offer to the holders of
Preferred Stock rights or warrants to subscribe for or to
purchase any additional shares of Preferred Stock or shares of
stock of any class or any other securities, rights or options, or
(iii) to effect any reclassification of its Preferred Stock
(other than a reclassification involving only the subdivision of
outstanding shares of Preferred Stock), or (iv) to effect any
consolidation or merger into or with any other Person (other than
a Subsidiary of the Company in a transaction which does not
violate Section 11(b) hereof), 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
(other than the Company and/or any of its Subsidiaries in one or
more transactions each of which does not violate Section 14(b)
hereof), 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 a Rights Certificate, in accordance with
Section 27 hereof, a notice of such proposed action to the extent
feasible, and file a certificate with the Rights Agent that
effect, which shall specify the record date for the purposes of
such stock dividend, distribution of rights or warrants, or the
date on which such reclassification, consolidation, merger, sale,
transfer, liquidation, dissolution, or winding up is to take
place and the date of participation therein by the holders of the
shares of Preferred Stock, if any such date is to be fixed, and
such notice shall be
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<PAGE>
so given in the case of any action covered by clause (i) or (ii)
above at least 20 days prior to the record date for determining
holders of the shares of Preferred Stock for purposes of such
action, and in the case of any such other action, at least 20
days prior to the date of the taking of such proposed action or
the date of, participation therein by the holders of the shares
of Preferred Stock whichever shall be the earlier.
(b) In case of a Section 11(a)(ii) Event, then, (i)
the Company shall as soon as practicable thereafter give to each
holder of a Rights Certificate, in accordance with Section 27
hereof, a notice of the occurrence of such event, which notice
shall specify the event and the consequences of the event to
holders of Rights under Section 11(a)(ii) hereof and (ii) all
references in the preceding Section 26(a) to Preferred Stock
shall be deemed thereafter to refer also, if appropriate, to
Common Stock and/or, if appropriate, other securities of the
Company.
Section 27. Notices. Notices or demands authorized by this
-------
Agreement to be given or made by the Rights Agent or by the
holder of any Rights Certificate to or on the Company shall be
sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing
with the Rights Agent) as follows:
FirstFed Financial Corp.
401 Wilshire Boulevard
Santa Monica, California 90401-1490
Telecopier: 310-319-6046
Attention: Secretary
Subject to the provisions of Section 22, any notice or demand
authorized by this Agreement to be given or made by the Company
or by the holder of any Rights Certificate to or on the Rights
Agent shall be addressed (until another address is filed in
writing with the Company) as follows:
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<PAGE>
Harris Trust and Savings Bank
311 West Monroe Street
Post Office Box 755
Chicago, Illinois 60690
Telecopier: 312-765-8052
Attention: Susan Shadel
The method of delivery of all documents is at the option and risk
of the sender and not Harris Trust and Savings Bank. If such
delivery is by mail, registered or certified mail with return
receipt requested, properly insured, is recommended.
Notices or demands authorized by this Agreement to be given
or made by the Company or the Rights Agent to the holder of any
Rights Certificate or, if prior to the Distribution Date, to the
holder of certificates representing Common Stock shall be
sufficiently given or made if sent by first-class mail, postage
prepaid, addressed to such holder at the address of such holder
as shown on the registry books of the Company.
Section 28. Supplements and Amendments. Prior to the
--------------------------
Distribution Date, the Company and the Rights Agent shall, if the
Company so directs, supplement or amend any provision of this
Agreement without the approval of any holders of certificates
representing Common Stock. From and after the Distribution Date,
the Company and the Rights Agent, shall, if the Company so
directs, supplement or amend this Agreement without the approval
of any holders of Rights Certificates 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 the provisions
hereunder in any manner which the Company may deem necessary or
desirable and which shall not adversely affect the interests of
the holders of Right Certificates (other than an Acquiring Person
or an Affiliate or Associate of an Acquiring 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 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, and/or the benefits to,
the holders of
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<PAGE>
Rights. 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 28,
the Rights Agent shall execute such supplement or amendment
provided that such supplement or amendment does not adversely
affect the rights or obligations of the Rights Agent under
Sections 19 or 21 of this Agreement. Notwithstanding anything in
this Agreement to the contrary, no supplement or amendment
that changes the rights and duties of the Rights Agent under this
Agreement will be effective against the Rights Agent without the
execution of such supplement or amendment by the Rights Agent.
Prior to this Distribution Date, the interests of the holders of
Rights shall be deemed coincident with the interests of the
holders of Common Stock.
Section 29. Determination and Actions by the Board of
-----------------------------------------
Directors, etc. For all purposes of this Agreement, any
- --------------
calculation of the number of shares of Common Stock outstanding
at any particular time, including for purposes of determining the
particular percentage of such outstanding shares of Common Stock
or any other securities of which any Person is the Beneficial
Owner, shall be made in accordance with the last sentence of Rule
13d-3(d)(1)(i) of the General Rules and Regulations under the
Exchange Act as in effect on the date of this Agreement. The
Board of Directors of the Company shall have the exclusive power
and authority to administer this Agreement and to exercise all
rights and powers specifically granted to the Board or the
Company, or as may be necessary or advisable in the
administration of this Agreement, including, without limitation,
the right and power to (i) interpret the provisions of this
Agreement, and (ii) make all determinations deemed necessary or
advisable for the administration of this Agreement (including
without limitation, a determination to redeem or not redeem the
Rights or to amend the Agreement). All such actions,
calculations, interpretations and determinations (including, for
purposes of clause (y) below, all omissions with respect to the
foregoing) which are done or made by the Board in good faith,
shall (x) be final, conclusive and binding on the Company, the
Rights Agent, the holders of the Rights Certificates and all
other parties, and (y) not subject the Board to any liability to
the holders of the Rights Certificates.
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<PAGE>
Section 30. Successors. All the covenants and provisions
----------
of this Agreement by or for the benefit of the Company or the
Rights Agent shall bind and inure to the benefit of their
respective successors and assigns hereunder.
Section 31. 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 Rights 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 registered holders of the Rights
Certificates (and, prior to the Distribution Date, the Common
Stock).
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.
Section 33. Governing Law. This Agreement, each Right and
-------------
each Rights Certificate issued hereunder shall be deemed to be a
contract made under the laws of the State of Delaware and for all
purposes shall be governed by and construed in accordance with
the laws of such State applicable to contracts to be made and to
be performed entirely within such State.
Section 34. 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 35. 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.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and their respective corporate
seals to be hereunto affixed and attested, all as of the day and
year first above written.
Attest: FIRSTFED FINANCIAL CORP.
[SEAL]
__________________________ By: ____________________________
Name: Ann E. Lederer Name: Babette E. Heimbuch
Title: Secretary and General Title: President and CEO
Counsel
Attest: HARRIS TRUST AND SAVINGS BANK,
[SEAL] as Rights Agent
__________________________ By: _____________________________
Name: Name:
Title: Title:
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<PAGE>
EXHIBIT A
---------
AMENDED CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
OF SERIES A PREFERRED STOCK
of
FIRSTFED FINANCIAL CORP.
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
FirstFed Financial Corp., a corporation organized and
existing under the General Corporation Law of the State of
Delaware (the "Corporation"), in accordance with the provisions
of Section 103 thereof, DOES HEREBY CERTIFY:
That (i) pursuant to the authority conferred upon the
Board of Directors by the Certificate of Incorporation, the Board
of Directors on November 2, 1988, adopted a resolution creating a
series of 250,000 shares of Preferred Stock designated as "Series
A Preferred Stock"; (ii) the Corporation filed a Certificate of
Designation, Preferences and Rights of Series A Preferred Stock
on November 4, 1988 (the "Certificate of Designation"), and (iii)
no shares of the Series A Preferred Stock have been issued.
The Corporation DOES HEREBY FURTHER CERTIFY:
That pursuant to the authority conferred upon the Board of
Directors by Article FOURTH of the Certificate of Incorporation
and Section 151(g) of the General Corporation Law of the State of
Delaware, the Board of Directors on June 25, 1998, adopted the
following resolution amending the Certificate of Designation
originally filed with the Secretary of State of Delaware on
November 4, 1988, that created a series of preferred stock
designated as "Series A Preferred Stock:"
RESOLVED, that pursuant to the authority vested in the Board of
Directors of the Corporation by Article FOURTH of the Certificate
of Incorporation, the Certificate of Designation originally filed
with the Secretary of State of the State of Delaware on November
4, 1988, that created a series of preferred stock designated as
"Series A Preferred Stock" of the Corporation be, and it hereby
is, amended, and that the designation and amount thereof and the
powers, preferences and relative, participating, optional and
other special rights of the shares of such series, and the
qualifications, limitations or restrictions thereof are as
follows:
Section 1. Designation and Amount. The shares of such
series shall be designated as "Series A Preferred Stock" $0.01
par value per share, and the number of shares constituting such
series shall be 250,000. Such number of shares may be increased
or decreased by resolution of
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<PAGE>
the Board of Directors; provided, that no decrease shall reduce
the number of shares of Series A Preferred Stock to a number less
than that of the shares then outstanding plus the number of
shares issuable upon exercise of outstanding rights, options or
warrants or upon conversion of outstanding securities issued by
the Corporation.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the
holders of any shares of any series of Preferred Stock ranking
prior and superior to the shares of Series A Preferred Stock with
respect to dividends, the holders of shares of Series A Preferred
Stock in preference to the holders of shares of Common Stock, par
value $.01 per share (the "Common Stock"), of the Corporation and
any other junior stock, shall be entitled to receive, when, as
and if declared by the Board of Directors out of funds legally
available for the purpose, quarterly dividends payable in cash on
the first day of January, April, July and October in each year
(each such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a
share of Series A Preferred Stock in an amount per share (rounded
to the nearest cent) equal to the greater of (a) $10.00, or (b)
subject to the provision for adjustment hereinafter set forth,
1,000 times the aggregate per share amount of all cash dividends,
and 1,000 times the aggregate per share amount (payable in kind)
of all non-cash dividends or other distributions other than a
dividend payable in shares of Common Stock or a subdivision of
the outstanding shares of Common Stock (by reclassification or
otherwise), declared on the Common Stock, since the immediately
preceding Quarterly Dividend Payment Date, or, with respect to
the first Quarterly Dividend Payment Date, since the first
issuance of any share or fraction of a share of Series A
Preferred Stock. In the event the Corporation shall at any time
after November 15, 1988 (the "Rights Declaration Date") (i)
declare any dividend on Common Stock payable in shares of Common
Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of
shares, then in each such case the amount to which holders of
shares of Series A Preferred Stock were entitled immediately
prior to such event under clause (b) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or
distribution on the Series A Preferred Stock as provided in
paragraph (A) above immediately after it declares a dividend or
distribution on the Common Stock (other than a dividend payable
in shares of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on the Common
Stock during the period between any Quarterly Dividend Payment
Date and the next subsequent Quarterly Dividend Payment Date, a
dividend of $10.00 per share on the Series A Preferred Stock
shall nevertheless be payable on such subsequent Quarterly
Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative
on outstanding shares of Series A Preferred Stock from the
Quarterly Dividend Payment Date next preceding the date of issue
of such shares of Series A Preferred Stock unless the date of
issue of such shares is prior
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<PAGE>
to the record date for the first Quarterly Dividend Payment Date,
in which case dividends on such shares shall begin to accrue from
the date of issue of such shares, or unless the date of issue is
a Quarterly Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series A
Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of which
events such dividends shall begin to accrue and be cumulative
from such Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares
of Series A Preferred Stock in an amount less than the total
amount of such dividends at the time accrued and payable on such
shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders
of shares of Series A Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which
record date shall be no more than 30 days prior to the date fixed
for the payment thereof.
Section 3. Voting Rights. The holders of shares of
Series A Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment
hereinafter set forth, each share of Series A Preferred Stock
shall entitle the holder thereof to 1,000 votes on all matters
submitted to a vote of the shareholders of the Corporation.
(B) Except as otherwise provided herein or by law, the
holders of shares of Series A Preferred Stock and the holders of
shares of Common Stock shall vote together as one class on all
matters submitted to a vote of shareholders of the Corporation.
(C) (i) If at any time dividends on any Series A
Preferred Stock shall be in arrears in an amount equal to six
(6) quarterly dividends thereon, the occurrence of such
contingency shall mark the beginning of a period (herein called
a "default period") which shall extend until such time when all
accrued and unpaid dividends for all previous quarterly dividend
periods and for the current quarterly dividend period on all
shares of Series A Preferred Stock then outstanding shall have
been declared and paid or set apart for payment. During each
default period, all holders of Preferred Stock (including
holders of the Series A Preferred Stock) with dividends in
arrears in an amount equal to six (6) quarterly dividends
thereon, voting as a class, irrespective of series, shall have
the right to elect two (2) Directors.
(ii) During any default period, such voting right
of the holders of Series A Preferred Stock may be exercised
initially at a special meeting called pursuant to subparagraph
(iii) of this Section 3(C) or at any annual meeting of
shareholders, and thereafter at annual meetings of shareholders,
provided that neither such voting right nor the right of the
holders of any other series of Preferred Stock, if any, to
increase, in certain cases, the authorized number of Directors
shall be exercised unless the holders of ten percent (10%) in
number of shares of Preferred Stock outstanding shall be present
in person or by proxy. The absence of a quorum of the holders of
Common Stock shall not affect the exercise by the holders of
Preferred Stock of such voting right. At any meeting at which
the holders of Preferred Stock shall exercise such voting right
initially during an existing default period, they shall have the
right, voting as a
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<PAGE>
class, to elect Directors to fill such vacancies, if any, in the
Board of Directors as may then exist up to two (2) Directors or,
if such right is exercised at an annual meeting, to elect two (2)
Directors. If the number which may be so elected at any special
meeting does not amount to the required number, the holders of
the Preferred Stock shall have the right to make such increase in
the number of Directors as shall be necessary to permit the
election by them of the required number. After the holders of
the Preferred Stock shall have exercised their right to elect
Directors in any default period and during the continuance of
such period, the number of Directors shall not be increased or
decreased except by vote of the holders of Preferred Stock as
herein provided or pursuant to the rights of any equity
securities ranking senior to or pari passu with the Series A
Preferred Stock.
(iii) Unless the holders of Preferred Stock
shall, during an existing default period, have previously
exercised their right to elect Directors, the Board of Directors
may order, or any shareholder or shareholders owning in the
aggregate not less than ten percent (10%) of the total number of
shares of Preferred Stock outstanding, irrespective of series,
may request, the calling of a special meeting of the holders of
Preferred Stock, which meeting shall thereupon be called by the
President, a Vice-President or the Corporate Secretary of the
Corporation. Notice of such meeting and of any annual meeting at
which holders of Preferred Stock are entitled to vote pursuant to
this paragraph (C)(iii) shall be given to each holder of record
of Preferred Stock by mailing a copy of such notice to him or her
at his last address as the same appears on the books of the
Corporation. Such meeting shall be called for a time not earlier
than 10 days and not later than 60 days after such order or
request or in default of the calling of such meeting within 60
days after such order or request, such meeting may be called on
similar notice by any shareholder or shareholders owning in the
aggregate not less than ten percent (10%) of the total number of
shares of Preferred Stock outstanding. Notwithstanding the
provisions of this paragraph (C)(iii), no such special meeting
shall be called during the period within 60 days immediately
preceding the date fixed for the next annual meeting of the
shareholders.
(iv) In any default period, the holders of Common
Stock, and other classes of stock of the Corporation if
applicable, shall continue to be entitled to elect the whole
number of Directors until the holders of Preferred Stock shall
have exercised their right to elect two (2) Directors voting as
a class, after the exercise of which right (x) the Directors so
elected by the holders of Preferred Stock shall continue in
office until their successors shall have been elected by such
holders or until the expiration of the default period, and (y)
any vacancy in the Board of Directors may (except as provided in
paragraph (C)(ii) of this Section 3) be filled by vote of a
majority of the remaining Directors theretofore elected by the
holders of the class of stock which elected the Director whose
office shall have become vacant. References in this paragraph
(C) to Directors elected by the holders of a particular class of
stock shall include Directors elected by such Directors to fill
vacancies as provided in clause (y) of the foregoing sentence.
(v) Immediately upon the expiration of a default
period, (x) the right of the holders of Preferred Stock as a
class to elect Directors shall cease, (y) the term of any
Directors elected by the holders of Preferred Stock as a class
shall terminate, and (z) the
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<PAGE>
number of Directors shall be such number as may be provided for
in, or pursuant to, the Restated Certificate of Incorporation or
By-Laws irrespective of any increase made pursuant to the
provisions of paragraph (C)(ii) of this Section 3 (such number
being subject, however to change thereafter in any manner
provided by law or in the Restated Certificate of Incorporation
or By-Laws). Any vacancies in the Board of Directors effected
by the provisions of clauses (y) and (z) in the preceding
sentence may be filled by a majority of the remaining Directors,
even though less than a quorum.
(D) Except as set forth herein, holders of Series A
Preferred Stock shall have no special voting rights and their
consent shall not be required (except to the extent they are
entitled to vote with holders of Common Stock as set forth
herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided
in Section 2 are in arrears, thereafter and until all accrued and
unpaid dividends and distributions, whether or not declared, on
shares of Series A Preferred Stock outstanding shall have been
paid in full, the Corporation shall not
(i) declare or pay dividends on, make
any other distributions on, or redeem or purchase or
otherwise acquire for consideration any shares of stock
ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A
Preferred Stock;
(ii) declare or pay dividends on or make
any other distributions on any shares of stock ranking
on a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Preferred
Stock except dividends paid ratably on the Series A
Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares
are then entitled;
(iii) redeem or purchase or otherwise
acquire for consideration shares of any stock ranking on
a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Preferred
Stock provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any such
parity stock in exchange for shares of any stock of the
Corporation ranking junior (either as to dividends or
upon dissolution, liquidation or winding up) to the
Series A Preferred Stock; or
(iv) purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock or
any shares of stock ranking on a parity with the Series
A Preferred Stock except in accordance with a purchase
offer made in writing or by publication (as determined
by the Board of Directors) to all holders of such shares
upon such terms as the Board of Directors, after
consideration of the
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<PAGE>
respective annual dividend rates and other relative
rights and preferences of the respective series and
classes, shall determine in good faith will result in
fair and equitable treatment among the respective series
or classes.
(B) The Corporation shall not permit any subsidiary of
the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the Corporation unless the
Corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in
such manner.
Section 5. Reacquired Shares. Any shares of Series A
Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired and
cancelled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but
unissued shares of Preferred Stock and may be reissued as part
of a new series of Preferred Stock to be created by resolution
or resolutions of the Board of Directors, subject to the
conditions and restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. (A)
Upon any liquidation (voluntary or otherwise), dissolution or
winding up of the Corporation, no distribution shall be made to
the holders of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock, unless, prior thereto, the holders of
shares of Series A Preferred Stock shall have received per
share, the greater of 1,000 times the exercise price per right
or 1,000 times the payment made per share of Common Stock, plus
an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of
such payment (the "Series A Liquidation Preference"). Following
the payment of the full amount of the Series A Liquidation
Preference, no additional distributions shall be made to the
holders of shares of Series A Preferred Stock unless, prior
thereto, the holders of shares of Common Stock shall have
received an amount per share (the "Common Adjustment") equal to
the quotient obtained by dividing (i) the Series A Liquidation
Preference by (ii) 1,000 (as appropriately adjusted as set forth-
in subparagraph (C) below to reflect such events as stock
splits, stock dividends and recapitalizations with respect to
the Common Stock) (such number in clause (ii), the "Adjustment
Number"). Following the payment of the full amount of the
Series A Liquidation Preference and the Common Adjustment in
respect of all outstanding shares of Series A Preferred Stock
and Common Stock, respectively, holders of Series A Preferred
Stock and holders of shares of Common Stock shall receive their
ratable and proportionate share of the remaining assets to be
distributed in the ratio of the Adjustment Number to 1 with
respect to such Preferred Stock and Common Stock, on a per share
basis, respectively.
(B) In the event there are not sufficient assets
available to permit payment in full of the Series A Liquidation
Preference and the liquidation preferences of all other series
of Preferred Stock, if any, which rank on a parity with the
Series A Preferred Stock then such remaining assets shall be
distributed ratably to the holders of such parity shares in
proportion to their respective liquidation preferences. In the
event there are not sufficient assets available to permit
payment in full of the Common Adjustment, then such remaining
assets shall be distributed ratably to the holders of Common
Stock.
-A6-
<PAGE>
(C) In the event the Corporation shall at any time
after the Rights Declaration Date (i) declare any dividend on
Common Stock payable in shares of Common Stock, (ii) subdivide
the outstanding Common Stock, or (iii) combine the outstanding
Common Stock into a smaller number of shares, then in each such
case the Adjustment Number in effect immediately prior to such
event shall be adjusted by multiplying such Adjustment Number by
a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common
Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case
the shares of Series A Preferred Stock shall at the same time be
similarly exchanged or changed in an amount per share (subject to
the provision for adjustment hereinafter set forth) equal to
1,000 times the aggregate amount of stock, securities, cash
and/or any other property (payable in kind), as the case may be,
into which or for which each share of Common Stock is changed or
exchanged. In the event the Corporation shall at any time after
the Rights Declaration Date (i) declare any dividend on Common
Stock payable in shares of Common Stock, (ii) subdivide the
outstanding Common Stock, or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such case the
amount set forth in the preceding sentence with respect to the
exchange or change of shares of Series A Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator
of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the
number of shares of Common Stock that are outstanding immediately
prior to such event.
Section 8. Redemption. The shares of Series A Preferred
Stock shall not be redeemable.
Section 9. Ranking. The Series A Preferred Stock shall
rank junior to all other series of the Corporation's Preferred
Stock as to the payment of dividends and the distribution of
assets, unless the terms of any such series shall provide
otherwise.
Section 10. Amendment. The Certificate of Incorporation
of the Corporation shall not be further amended in any manner
which would materially alter or change the powers, preferences or
special rights of the holders of the Series A Preferred Stock so
as to affect them adversely without the affirmative vote of the
holders of at least two-thirds (66 2/3%) of the outstanding
shares of Series A Preferred Stock voting separately as a class.
Section 11. Fractional Shares. Series A Preferred Stock
may be issued in fractions of a share which shall entitle the
holder, in proportion to such holders fractional shares, to
exercise voting rights, receive dividends, in distributions and
to have the benefit of all other rights of holders of Series A
Preferred Stock.
-A7-
<PAGE>
IN WITNESS WHEREOF, I have executed and subscribed this
Amended Certificate of Designation and do affirm the foregoing as
true under the penalties of perjury, this 25th day of June, 1998.
FIRSTFED FINANCIAL CORP.
By:_______________________
Name: Ann E. Lederer
Title: Secretary and General
Counsel
-A8-
<PAGE>
Exhibit B
---------
[Form of Rights Certificate]
----------------------------
Certificate No. R- ______ Rights
NOT EXERCISABLE AFTER NOVEMBER 15, 2008
OR EARLIER IF NOTICE OF REDEMPTION IS
GIVEN. THE RIGHTS ARE SUBJECT TO
REDEMPTION, AT THE OPTION OF THE
COMPANY, AT $.01 PER RIGHT ON THE TERMS
SET FORTH IN THE RIGHTS AGREEMENT. THE
RIGHTS ARE SUBJECT TO EXCHANGE, AT THE
OPTION OF THE COMPANY, AT ONE COMMON
SHARE PER RIGHT ON THE TERMS SET FORTH
IN THE RIGHTS AGREEMENT. [THE RIGHTS
REPRESENTED BY THIS RIGHTS CERTIFICATE
ARE OR WERE BENEFICIALLY OWNED BY A
PERSON WHO WAS OR BECAME AN ACQUIRING
PERSON, OR AN ASSOCIATE, AFFILIATE OR
TRANSFEREE OF AN ACQUIRING PERSON
ACCORDINGLY, THIS RIGHTS CERTIFICATE AND
THE RIGHTS REPRESENTED HEREBY ARE NULL
AND VOID.](1)
Rights Certificate
FIRSTFED FINANCIAL CORP.
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 Amended and Restated Rights
Agreement dated as of June 25, 1998 (the "Rights Agreement")
between FirstFed Financial Corp., a Delaware corporation (the
"Company"), and Harris Trust and Savings Bank (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. (Chicago time) on November 15,
2008 at the principal office of the Rights Agent in Chicago,
Illinois, one one-thousandth of a fully paid, nonassessable share
of Series A Preferred Stock (the "Preferred Stock") of the
Company, at a
_______________
(1) The portion of the Legend in brackets shall be inserted only
if applicable.
-B1-
<PAGE>
purchase price of $200.00 per one one-thousandth of a share (the
"Purchase Price"), upon presentation and surrender of this Rights
Certificate with the appropriate Form of Election to Purchase
duly executed. The number of Rights evidenced by this Rights
Certificate (and the number of shares which may be purchased upon
exercise thereof) set forth above, and the Purchase Price set
forth above, are the number and Purchase Price as of June 25,
1998 based on the Preferred Stock as constituted at such date.
As provided in the Rights Agreement, the Purchase Price and the
number of shares of Preferred Stock or other securities which may
be purchased upon the exercise of the Rights evidenced by this
Rights Certificate are subject to modification and adjustment
upon the happening of certain events.
This Rights Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities
hereunder of the Rights Agent, the Company and the holders of the
Rights Certificates. Copies of the Rights Agreement are on file
at the principal office of the Company and are also available
upon written request to the Company.
This Rights Certificate, with or without other Rights
Certificates, upon surrender at the principal office of the
Rights Agent, may be exercised for another Rights Certificate or
Rights Certificates of like tenor and date evidencing Rights
entitling the holder to purchase a like aggregate number of
shares of Preferred Stock as the Rights evidenced by the Rights
Certificate or Rights Certificates surrendered shall have
entitled such holder to purchase. If this Rights Certificate
shall be exercised (other than pursuant to Section 11(a)(ii) of
the Rights Agreement) in part, the holder shall be entitled to
receive upon surrender hereof another Rights Certificate or
Rights Certificates for the number of whole Rights not exercised.
If this Rights Certificate shall be exercised in whole or in part
pursuant to Section 11(a)(ii) of the Rights Agreement, the holder
shall be entitled to receive this Rights Certificate duly marked
to indicate that such exercise has occurred as set forth in the
Rights Agreement.
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate may be redeemed by the
Company at its option at a redemption price of $.01 per Right.
Subject to the provisions of the Rights Agreement, the Company,
at its option, may elect to mail payment of the redemption price
to the registered holder of the Right at the time of redemption,
in which event this certificate may become void without any
further action by 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 one one-thousandth or integral multiples of
one one-thousandth 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.
No holder, as such, of any Rights 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
-B2-
<PAGE>
the Company which may at any time be issuable on the exercise of
the Rights represented thereby, nor shall anything contained
herein or in any Rights Certificate be construed to confer upon
the holder of any Rights Certificate, as such, any of the rights
of a shareholder of the Company or any right to vote for the
election of directors or upon any matter submitted to
shareholders at any meeting thereof, or to give or withhold
consent to any corporate action, or, to receive notice of
meetings or other actions affecting shareholders (except as
provided Section 26 of the Rights Agreement), or to receive
dividends or other distributions or otherwise, until the Right or
Rights evidenced by this Rights Certificate shall have been
exercised.
This Rights Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights
Agent.
-B3-
<PAGE>
WITNESS the facsimile signature of the proper officers of
the Company and its corporate seal. Dated as of ___________.
ATTEST: _______________________________
_____________________________ _______________________________
Name: Name:
Title: Title:
Countersigned:
HARRIS TRUST & SAVINGS BANK,
as Rights Agent
____________________________
Authorized Signature
-B4-
<PAGE>
[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
------------------
(To be executed by the registered holder if such
holder desires to transfer the Rights Certificate.)
FOR VALUE RECEIVED ______________________________ hereby sell,
assigns and transfers unto ___________________________________
______________________________________________________________
(Please print name and address of transferee)
______________________________________________________________
this Rights Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and
appoint ____________ Attorney, to transfer the within Rights
Certificate on the books of the within-named Company, with full
power of substitution.
Dated:_____________, ____
___________________________
Signature
Signature Guaranteed:
-B5-
<PAGE>
Certificate
-----------
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Rights Certificate [ ]
are [ ] are not being sold, assigned and transferred by or on
behalf of a Person who is or was an Acquiring Person or an
Affiliate, Associate or transferee of any such Acquiring Person
(as such terms are defined in the Rights Agreement);
(2) after due inquiry and to the best knowledge of the
undersigned, it did not acquire the Rights evidenced by this
Rights Certificate from any Person who is, or was an Acquiring
Person, or an Affiliate, Associate or transferee of any such
Acquiring Person (as such terms are defined in the Rights
Agreement).
Dated: __________, ____
___________________________
Signature
NOTICE
------
The signature to the foregoing Assignment must correspond to
the name as written upon the face of this Rights Certificate in
every particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above in the Form
of Assignment or the Form of Election to Purchase, as the case
may be, is not completed, the Company and the Rights Agent will
deem the Beneficial Owner of the Rights evidenced by this Rights
Certificate to be an Acquiring Person, or any Affiliate,
Associate or transferee of such Acquiring Person (as such terms
are defined in the Rights Agreement), and such Assignment or
Election to Purchase will not be honored.
-B6-
<PAGE>
FORM OF ELECTION TO PURCHASE
----------------------------
(To be executed if holder desires to
exercise the Rights Certificate pursuant to
Section 11(a)(ii) of the Rights Agreement.)
To FIRSTFED FINANCIAL CORP.:
The undersigned hereby irrevocably elects to exercise
___________ Rights represented by this Rights Certificate to
purchase the shares of Common Stock (or such other securities of
the Company) issuable upon the exercise of the Rights and
requests that certificates for such shares be issued in the name
of:
_________________________________________________________________
(Please insert social security or other identifying number)
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
The Rights Certificate indicating the balance, if any, of
such Rights which may still be exercised pursuant each of to
Section 11(a)(ii) and Section 13 of the Rights Agreement shall be
returned to the undersigned unless such person requests that the
Rights Certificate be registered in the name of and delivered to:
_________________________________________________________________
Please insert social security or other identifying number
(complete only if Rights Certificate is to be registered in a
name other than the undersigned)
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
Dated: ____________, ____
__________________________
Signature
Signature Guaranteed:
-B7-
<PAGE>
Certificate
-----------
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Rights Certificate [ ]
are [ ] are not being exercised by or on behalf of a Person who
is or was an Acquiring Person or Affiliate, Associate or
transferee of any such Acquiring Person (as such terms are
defined in the Rights Agreement);
(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, or
was an Acquiring Person, or an Affiliate, Associate or transferee
of any such Acquiring Person (as such terms are defined in the
Rights Agreement).
Dated: _________, ____ ______________________________
Signature
NOTICE
------
The signature to the foregoing Election to Purchase must
correspond to the name as written upon the face of this Rights
Certificate in every particular, without alteration or
enlargement or any change whatsoever.
In the event the certification set forth above in the Form
of Assignment or the Form of Election to Purchase, as the case
may be, is not completed, the Company and the Rights Agent will
deem the Beneficial Owner of the Rights evidenced by this Rights
Certificate to be an Acquiring Person, or any Affiliate,
Associate or transferee of such Acquiring Person (as such terms
are defined in the Rights Agreement), and such Assignment or
Election to Purchase will not be honored.
-B8-
<PAGE>
FORM OF ELECTION TO PURCHASE
----------------------------
(To be executed if holder desires to
exercise the Rights Certificate other than pursuant to
Section 11(a)(ii) of the Rights Agreement.)
To FIRSTFED FINANCIAL CORP.:
The undersigned hereby irrevocably elects to exercise Rights
represented by this Rights Certificate to purchase the shares of
Preferred Stock (or such other securities of the Company or any
other Person) issuable upon the exercise of the Rights and
requests that certificates for such shares be issued in the name
of:
________________________________________________________________
(Please insert social security or other identifying number)
________________________________________________________________
(Please print name and address)
________________________________________________________________
The Rights Certificate indicating the balance, if any, of
such Rights which may still be exercised pursuant to each of
Section 11(a)(ii) and Section 13 of the Rights Agreement shall be
returned to the undersigned unless such person requests that the
Rights Certificate be registered in the name of and delivered to:
_________________________________________________________________
Please insert social security or other identifying number
(complete only if Rights Certificate is to be registered in a
name other than the undersigned)
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
_________________________________________________________________
Dated: ____________, ____
__________________________
Signature
Signature Guaranteed:
-B9-
<PAGE>
Certificate
-----------
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Rights Certificate [ ]
are [ ] are not being sold, assigned and transferred by or on
behalf of a Person who is or was an Acquiring Person, or an
Affiliate, Associate or transferee of any such Acquiring Person
(as such terms are defined pursuant to the Rights Agreement);
(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, or
was an Acquiring Person, or an Affiliate, Associate or transferee
of any such Acquiring Person (as such terms are defined in the
Rights Agreement).
Dated: _________, ____ _______________________________
Signature
NOTICE
------
The signature to the foregoing Election to Purchase must
correspond to the name as written upon the face of this Rights
Certificate in every particular, without alteration or
enlargement or any change whatsoever.
In the event the certification set forth above in the Form
of Assignment or the Form of Election to Purchase, as the case
may be, is not completed, the Company and the Rights Agent will
deem the Beneficial Owner of the Rights evidenced by this Rights
Certificate to be an Acquiring Person, or any Affiliate,
Associate or transferee of such Acquiring Person (as such terms
are defined in the Rights Agreement), and such Assignment or
Election to Purchase will not be honored.
-B10-
<PAGE>
Exhibit C
---------
SUMMARY OF RIGHTS
On October 20, 1988 the Board of Directors of FirstFed
Financial Corp. (the "Company") declared a dividend distribution
of one right (a "Right") for each outstanding share of common
stock, $.01 par value (the "Common Stock"), of the Company to
stockholders of record at the close of business on November 15,
1988 (the "Record Date"), with such Rights to expire on November
15, 1998. On June 25, 1998, the Board of Directors of the
Company extended the expiration date of the Rights and adopted
certain amendments to the terms of the Rights. Except as set
forth below, each Right (as amended), when exercisable, entitles
the registered holder to purchase from the Company one
one-thousandth share of a series of preferred stock, designated
as Series A Preferred Stock, $0.01 par value (the "Preferred
Stock"), at a price of $200.00 per share (the "Purchase Price"),
subject to adjustment. The description and terms of the Rights,
as amended, are set forth in an Amended and Restated Rights
Agreement (the "Rights Agreement") between the Company and Harris
Trust and Savings Bank, as Rights Agent.
Initially, the Rights will be attached to all Common Stock
certificates representing shares then outstanding, and no
separate Rights certificates will be distributed. Until the
earlier to occur of (i) the first date of public announcement
that, without the prior consent of the Company, a Person (as
defined in the Rights Agreement), alone or together with its
Affiliates and Associates (as defined in the Rights Agreement),
has acquired, or obtained the right to acquire, beneficial
ownership of 15% or more of the outstanding shares of Common
Stock of the Company (the "Stock Acquisition Date") or (ii) the
close of business on the tenth (10th) business day (unless such
date is extended by the Board of Directors) following the
commencement of (or a public announcement of an intention to
make) a tender offer or exchange offer which would result in any
Person or group of related Persons becoming an Acquiring Person,
without the prior consent of the Company (the earliest of such
dates being called the "Distribution Date"), the Rights will be
evidenced, with respect to any of the Common Stock certificates
outstanding as of June 25, 1998, by such Common Stock
certificates.
The Rights Agreement provides that, until the Distribution
Date, the Rights will be transferred with and only with Common
Stock certificates. From as soon as practicable after the Record
Date and until the Distribution Date (or earlier redemption or
expiration of the Rights), new Common Stock certificates issued
after June 25, 1998 upon transfer, replacement or new issuance of
the Common Stock will contain a notation incorporating the Rights
Agreement by reference. Until the Distribution Date (or earlier
redemption or expiration of the Rights), the surrender for
transfer of any Common Stock certificates outstanding as of the
Record Date (with or without this Summary or Rights attached)
will also constitute the transfer of the Rights associated with
the Common Stock represented by such certificate. As soon as
practicable following the Distribution Date, separate
certificates evidencing the Rights ("Rights Certificates") will
be mailed to holders of record of the Common Stock as of the
close of business on the Distribution Date, and the separate
Rights Certificates alone will evidence the Rights.
-C1-
<PAGE>
The Rights are not exercisable until the Distribution Date
and will expire on November 15, 2008, unless earlier redeemed by
the Company as described below.
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 the Preferred
Stock of certain rights or warrants to subscribe for Preferred
Stock, certain convertible securities or securities having the
same or more favorable rights, privileges and preferences as the
Preferred Stock at less than the current market price of the
Preferred Stock or (iii) upon the distribution to holders of the
Preferred Stock of evidences of indebtedness or assets (excluding
regular quarterly cash dividends out of earnings or retained
earnings) or of subscription rights or warrants (other than those
referred to above).
The Purchase Price is also subject to adjustment in the
event of a stock split of the outstanding shares of Common Stock,
or a stock dividend on the outstanding shares of Common Stock
payable in shares of Common Stock, or subdivisions,
consolidations or combinations of the outstanding shares of
Common Stock occurring, in any such case, prior to the
Distribution Date.
With certain exceptions, no adjustments in the Purchase
Price will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price. No fractional
Rights will be issued and, in lieu thereof, an adjustment in cash
will be made based on the market price of the Rights on the last
trading date prior to the date of on which such fractional Rights
would otherwise be issuable.
In the event that any Person becomes an Acquiring Person
(unless pursuant to a tender offer or exchange offer for all
outstanding shares of Common Stock at a price and on terms
determined, prior to the purchase of shares under such tender or
exchange offer, by at least a majority of the members of the
Disinterested Directors to be both adequate and otherwise in the
best interests of the Company and its stockholders (a "Permitted
Offer")), proper provision shall be made so that each holder of a
Right will thereafter have the right for a 60-day period after
the later of (i) the date of such event or (ii) the effectiveness
of an appropriate registration statement, to receive upon
exercise of the Right that number of units of one one-thousandths
of a share of Preferred Stock (or, under certain circumstances,
shares of Common Stock or other securities) having an average
market value during a specified time period (immediately prior to
the occurrence of a Person becoming an Acquiring Person) of two
times the Purchase Price of the Right (such right being called
the "Flip-In Right"). Disinterested Directors are directors of
the Company who are not (i) officers or employees of the Company,
(ii) Acquiring Persons or Affiliates or Associates thereof, or
representatives of any of them, or (iii) any Person who was
directly or indirectly proposed or nominated as a director of the
Company by an Acquiring Person.
-C2-
<PAGE>
In the event that, at any time on or following the Stock
Acquisition Date, the Company is, directly or indirectly,
acquired in a merger or other business combination transaction or
50% or more of the Company's assets or earning power are sold (in
one transaction or a series of transactions), proper provision
shall be made so that each holder of a Right (except a Right
voided as set forth below) shall thereafter have the right to
receive, upon the exercise thereof at the then current Purchase
Price of the Right, that number of shares of common stock of the
acquiring company (or, in the event there is more than one
acquiring company, the acquiring company receiving the greatest
portion of the assets or earning power transferred) which, on the
date of the consummation of such transaction, would have a market
value of two times the Purchase Price of the Right (such right
being called the "Flip-Over Right").
The holder of a Right will continue to have the Flip-Over
Right whether or not such holder exercises the Flip-In Right.
Upon the occurrence of any of the events giving rise to the
exercisability of the Flip-Over Right or the Flip-In Right, any
Rights that are or were at any time owned by an Acquiring Person
engaging in any of such transactions or receiving the benefits
thereof on or after the time the Acquiring Person becomes such
shall become null and void insofar as they relate to the Flip-
Over Right or the Flip-In Right.
The number of outstanding Rights associated with each share
of Common Stock and the voting and economic rights of each one
one-thousandth of a share of Preferred Stock issuable upon
exercise of each Right are also subject to adjustment in the
event of a stock split of the Common Stock or a stock dividend on
the Common Stock payable in Common Stock or subdivisions,
consolidations or combinations of the Common Stock occurring, in
any such case, prior to the Distribution Date.
At any time prior to the earlier to occur of (i) the close
of business on the Stock Acquisition Date or (ii) the expiration
of the Rights, the Company may redeem the rights in whole, but
not in part, at a price of $.01 per Right (the "Redemption
Price"), which redemption shall be effective upon the
authorization of a majority of the Board of Directors.
Additionally, following the Stock Acquisition Date and the
expiration of the period during which the Flip-In is exercisable,
the Company may redeem the then outstanding Rights in whole, but
not in part, at the Redemption Price provided that such
redemption is in connection with a merger or other business
combination transaction or series of transactions involving the
Company in which all holders of Common Stock are treated alike,
but not involving an Acquiring Person or any Affiliates or
Associates thereof. The redemption of Rights described in the
preceding sentence shall be effective only as of such time when
the Flip-in Right is not exercisable, and in any event, only
after 10 business days prior notice. Upon the effective date of
the 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.
At any time after a Person becomes an Acquiring Person but
before such Acquiring Person, together with all Affiliates and
Associates of such Person, becomes the Beneficial Owner of 50% or
more of the Common Shares then outstanding, the Company may, at
its option, exchange all or part of the then outstanding and
exercisable Rights (other than those owned by the Acquiring
Person, together with any Affiliates and Associates of such
Acquiring Person,
-C3-
<PAGE>
which have become null and void) at an exchange ratio of one
share of Common Stock per Right, appropriately adjusted to
reflect any stock split, stock dividend or similar transaction
involving either the Common Stock or the Preferred Stock
occurring after the date hereof (the "Exchange Ratio").
Immediately upon the action of the Board of Directors ordering
the exchange of any Rights and without any further action and
without any notice, the right to exercise such Rights shall
terminate and the only right thereafter of a holder of such
Rights shall be to receive that number of shares of Common Stock
equal to the number of such Rights held by such holder multiplied
by the Exchange Ratio.
The Preferred Stock purchasable upon exercise of the Rights
will be nonredeemable and junior to any other series of preferred
stock the Company may issue (unless otherwise provided in the
terms of such stock). Each share of Preferred Stock will have a
preferential quarterly dividend in an amount equal to 1,000 times
the dividend declared on each share of Common Stock, but in no
event less than $10.00. In the event of liquidation, the holders
of Preferred Stock will receive a preferred liquidation payment
equal to the greater of 1,000 times the payment made per share of
Common Stock. In the event of liquidation, the holders of
Preferred Stock will receive a preferred liquidation payment per
share equal to the greater of 1,000 times the Purchase Price per
Right or 1,000 times the payment made per each share of Common
Stock.
Each share of Preferred Stock will have 1,000 votes, voting
together with the shares of Common Stock, on all matters
submitted to a vote of the shareholders of the Company. If the
Company fails to pay dividends on the Preferred Stock for a
specified period (a "default period"), the holders of Preferred
Stock shall have the additional right to elect two (2) directors
to the Board of Directors until such default period expires.
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 1,000 times
the amount and type of consideration received per share of Common
Stock. The rights of the Preferred Stock as to dividends and
liquidation, and in the event of mergers and consolidations, are
protected by customary anti-dilution provisions. Fractional
shares of Preferred Stock will be issuable; however, the Company
may elect to distribute depositary receipts in lieu of such
fractional shares. In lieu of fractional shares other than
fractions that are multiples of one one-thousandth of a share, 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.
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.
The terms of the Rights may be amended by the Board of
Directors of the Company and the Rights Agent, (i) prior to the
Distribution Date in any manner, and (ii) on or after the
Distribution Date to cure any ambiguity, to shorten or lengthen
any time period under the Rights Agreement, to correct or
supplement any provision of the Rights Agreement which may be
defective or inconsistent with any other provisions, or in any
manner not adversely affecting the interests of the holders of
the Rights.
-C4-
<PAGE>
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an Exhibit to a Form 8-A/A
amending the Company's Registration Statement on Form 8-A,
previously filed on November 4, 1988. A copy of the Rights
Agreement is available free of charge from the Company. This
summary description of the Rights does not purport to be complete
and its qualified in its entirety by reference to the Rights
Agreement, which is incorporated herein by reference.
-C5-
EXHIBIT 99.1
FIRSTFED ANNOUNCES STOCK SPLIT AND EXTENSION OF RIGHTS PLAN
Santa Monica, California, June 26, 1998 - FirstFed Financial
Corp., parent company of first Federal Bank of California, (NYSE-
FED) today announced a two-for-one stock split of its common
stock. The additional shares will be distributed on July 30,
1998 to stockholders of record as of July 15, 1998. There will
be approximately 21.2 million shares of common stock outstanding
after the split. As of June 25, 1998, there are 10,607,636
shares outstanding.
Babette E. Heimbuch, FirstFed Financial Corp.'s President
and CEO, noted, "the Company has had continued growth in earnings
over the past several years. The stock split reflects management
belief in the strong fundamental earning power of the Company.
This split should increase the liquidity of the Company's stock
and keep the price in an optimum trading range."
The Company also announced today that its Board of Directors
extended the term of its existing shareholder rights plan to
November 15, 2008 and adopted certain amendments to the rights
plan. Under the plan, the rights become exercisable if any
person or group acquires 15% or more of FirstFed's common stock,
par value $.01 per share. The Board may redeem the rights prior
to the acquisition of 15% of the Company's stock or in certain
other circumstances oat $.01 per right. The rights plan, which
originally was adopted in November 1988, is intended to ensure
that FirstFed's shareholders receive fair treatment in the event
of any proposed acquisition of the Company and to encourage
potential acquirors to negotiate with the Company.
FirstFed Financial is the holding company for First Federal
Bank of California. The Bank operates 24 full service offices in
Southern California.
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