SECURITIES EXCHANGE AND COMMISSION
Washington, D.C. 20549
____________________
FORM 8-K
CURRENT REPORT
____________________
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report
(Date of earliest event reported): March 28, 1995
PROFFITT'S, INC.
(Exact name of registrant as specified in its charter)
Tennessee 0-15907 62-0331040
(State of (Commission File Number) (IRS Employer
Incorporation) Identification No.)
115 North Calderwood, Alcoa, Tennessee 37703
(Address of principal executive office) (Zip Code)
615/983-7000
(Registrant's telephone number, including area code)
<PAGE>
Item 5. Other Events.
On March 28, 1995 the Board of Directors of Proffitt's, Inc.
(the "Company") declared a dividend of one preferred share purchase
right (a "Right") for each outstanding share of common stock, par
value $.10 per share (the "Common Shares"), of the Company. The
dividend is payable on April 24, 1995, (the "Record Date") to the
stockholders of record on that date. Each Right entitles the
registered holder to purchase from the Company one one-hundredth of
a share of Series C Junior Preferred Stock, par value $1.00 per
share (the "Preferred Stock"), at a price of $85.00 per one one-
hundredth of a Preferred Share (the "Purchase Price"), subject to
adjustment. Each one one-hundredth of a share of Preferred Stock
has rights, privileges and preferences which make its value
approximately equal to the value of a Common Share. The
description and terms of the Rights are set forth in a Rights
Agreement dated as of March 28, 1995 (the "Rights Agreement"),
between the Company and Union Planters National Bank, as Rights
Agent (the "Rights Agent").
Initially, the Rights will be evidenced by the stock
certificates representing the Common Shares then outstanding, and
no separate Right Certificates, as defined, will be distributed.
Until the earlier to occur of (i) ten (10) days following a public
announcement that a person, entity or group of affiliated or
associated persons (an "Acquiring Person") have acquired beneficial
ownership of 20% or more of the outstanding Common Shares or (ii)
ten (10) business days (or such later date as may be determined by
action of the Board of Directors prior to such time as any person
or entity becomes an Acquiring Person) following the commencement
of, or announcement of an intention to make, a tender offer or
exchange offer the consummation of which would result in the
beneficial ownership by a person or group of 20% or more of such
outstanding Common Shares (the earlier of such dates being called
the "Distribution Date"), the Rights will be evidenced, with
respect to any of the Common Share certificates outstanding as of
the Record Date, by such Common Share certificates with or without
a copy of the Summary of Rights, which is included in the Rights
Agreement as Exhibit B thereof (the "Summary of Rights"), attached
thereto.
The Rights Agreement provides that, until the Distribution
Date, the Rights will be transferred with and only with the Common
Shares. Until the Distribution Date (or earlier redemption or
expiration of the Rights), new Common Share certificates issued
after the Record Date, upon transfer or new issuance of Common
Shares, will contain a notation incorporating the Rights Agreement
by reference. Until the Distribution Date (or earlier redemption
or expiration of the Rights), the surrender or transfer of any
certificates for Common Shares outstanding as of the Record Date,
even without such notation or a copy of the Summary of Rights being
attached thereto, will also constitute the transfer of the Rights
associated with the Common Shares represented by such certificate.
As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be
mailed to holders of record of the Common Shares as of the close of
business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on March 28, 2005 (the "Final Expiration
Date"), unless the Final Expiration Date is extended or unless the
Rights are earlier redeemed by the Company, in each case, as
described below.
The Purchase Price payable, and the number of Preferred Shares
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 Shares, (ii) upon
the grant to holders of the Preferred Shares of certain rights or
warrants to subscribe for or purchase Preferred Shares at a price,
or securities convertible into Preferred Shares with a conversion
price, less than the then current market price of the Preferred
Shares or (iii) upon the distribution to holders of the Preferred
Shares of evidences of indebtedness or assets (excluding regular
periodic cash dividends paid out of earnings or retained earnings
or dividends payable in Preferred Shares) or of subscription rights
or warrants (other than those referred to above). The exercise of
Rights for Preferred Shares is at all times subject to the
availability of a sufficient number of authorized but unissued
Preferred Shares.
The number of outstanding Rights and the number of one one-
hundredths of a Preferred Share issuable upon exercise of each
Right are also subject to adjustment in the event of a stock split
of the Common Shares or a stock dividend on the Common Shares
payable in Common Shares or subdivisions, consolidation or
combinations of the Common Shares occurring, in any case, prior to
the Distribution Date.
Preferred Shares purchasable upon exercise of the Rights will
not be redeemable. Each Preferred Share will be entitled to a
minimum preferential quarterly dividend payment of $1.00 but will
be entitled to an aggregate dividend of 100 times the dividend
declared per Common Share. In the event of liquidation, the
holders of the Preferred Shares will be entitled to a minimum
preferential liquidation payment of $100 but will be entitled to an
aggregate payment of 100 times the payment made per Common Share.
Each Preferred Share will have 100 votes, voting together with the
Common Shares. Finally, in the event of any merger, consolidation
or other transaction in which Common Shares are exchanged, each
Preferred Share will be entitled to receive 100 times the amount of
consideration received per Common Share. These rights are
protected by customary anti-dilution provisions. Because of the
nature of the Preferred Shares' dividend and liquidation rights,
the value of one one-hundredth of a Preferred Share should
approximate the value of one Common Share.
In the event that any person becomes an Acquiring Person,
proper provision shall be made so that each holder of a Right,
other than Rights beneficially owned by the Acquiring Person (which
will thereafter be void), will for a sixty (60) day period have the
right to receive upon exercise that number of Common Shares having
a market value of two times the exercise price of the Right (or, if
such number of shares is not and cannot be authorized, the Company
may issue Preferred Stock, cash, debt, stock or a combination
thereof in exchange for the Rights). This right will terminate
sixty (60) days after the date on which the Rights become
nonredeemable (as described below), unless there is an injunction
or similar obstacle to exercise of the Rights, in which event this
right will terminate sixty (60) days after the date on which the
Rights again become exercisable.
In the event that the Company is acquired in a merger or other
business combination transaction or 50% or more of its consolidated
assets or earning power are sold, proper provision will be made so
that each holder of a Right will thereafter have the right to
receive, upon the exercise thereof at the then current exercise
price of the Right, that number of shares of common stock of the
acquiring company which at the time of such transaction will have
a market value of two times the exercise price of the Right.
At any time after the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 20% or
more of the outstanding Common Shares and prior to the acquisition
by such person or group of 50% or more of the outstanding Common
Shares, the Board of Directors of the Company may exchange the
Rights (other than Rights owned by such person or group which have
become void), in whole or in part, at an exchange ratio of one
Common Share, or one one-hundredth of a Preferred Share, per Right
(or, if the number of shares is not and cannot be authorized, the
Company may issue cash, debt, stock or a combination thereof in
exchange for the Rights), subject to adjustment.
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an adjustment
of at least 1% in such Purchase Price. No fractional Preferred
Shares will be issued (other than fractions which are integral
multiples of the number of one one-hundredths of a Preferred Share
issuable upon the exercise of one Right, which may, at the option
of the Company, be evidenced by depositary receipts), and in lieu
thereof, an adjustment in cash will be made based on the market
price of the Preferred Shares on the last trading day prior to the
date of exercise.
At any time prior to the earliest of (i) the close of business
on the twentieth (20th) day following the first public announcement
that a person has become an Acquiring Person (subject to extension
for one or more successive ten (10) day periods pursuant to the
Rights Agreement), (ii) such time on or after the first public
announcement that a person has become an Acquiring Person as there
shall have occurred a Change of Control (as defined in the Rights
Agreement) of the Company, or (iii) the Final Expiration Date, the
Board of Directors of the Company may redeem the Rights in whole,
but not in part, at a price of $.01 per Right (the "Redemption
Price"). Following the expiration of the above periods, the Rights
become nonredeemable. Immediately upon any redemption of the
Rights, the right to exercise the Rights will terminate and the
only right of the holders of Rights will be to receive the
Redemption Price.
The terms of the Rights may be amended by the Board of
Directors of the Company without the consent of the holders of the
Rights, including an amendment to lower the threshold for
exercisability of the Rights from 20% to any percentage which is
(i) greater than the largest percentage of the outstanding Common
Shares then known to the Company to be beneficially owned by any
Person (other than the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or any Subsidiary, or any
entity holding Common Shares pursuant to the terms of any such
plan) and (ii) not less than 10%, except that from and after such
time as any person becomes an Acquiring Person no such amendment
may adversely affect the interest of the holders of the Rights.
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 Rights have certain anti-takeover effects. The Rights
will cause substantial dilution to a person or group that attempts
to acquire the Company on terms not approved by the Company's Board
of Directors. The Rights should not interfere with any merger or
other business combination approved by the Board of Directors since
the Rights may be redeemed by the Company at $.01 per Right prior
to the earliest of (i) the twentieth (20th) day following the time
that a person or group has acquired beneficial ownership of 20% or
more of the Common Shares (unless extended for one or more ten (10)
day periods by the Board of Directors), (ii) a Change of Control,
or (iii) the final expiration date of the rights.
Item 7. Exhibits.
1. Rights Agreement, dated as of March 28, 1995,
between Proffitt's, Inc., and Union Planters
National Bank, with exhibits.
2. Form of letter to be sent to Proffitt's, Inc.
stockholders, dated April __, 1995.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
PROFFITT'S, INC.
Dated: March 28, 1995
By: \s\ R. Brad Martin
R. Brad Martin, Chairman and
Chief Executive Officer
<PAGE>
INDEX TO EXHIBITS
Page number in
sequentially
number version
1. Rights Agreement, dated as of March 28, 1995
between Proffitt's, Inc. and Union Planters
National Bank as Rights Agent.
2. Form of Letter to be sent to Proffitt's, Inc.
stockholders, dated April __, 1995.
PROFFITT'S, INC.
and
UNION PLANTERS NATIONAL BANK
as Rights Agent
____________
Rights Agreement
Dated as of March 28, 1995
<PAGE>
TABLE OF CONTENTS
PAGE
1. Certain Definitions . . . . . . . . . . . . . . . . . . . 1
2. Appointment of Rights Agent . . . . . . . . . . . . . . . 7
3. Issuance of Rights Certificates . . . . . . . . . . . . . 7
4. Form of Rights Certificates . . . . . . . . . . . . . . . 9
5. Countersignature and Registration . . . . . . . . . . . . 9
6. Transfer, Split Up, Combination and Exchange of Rights
Certificates; Mutilated, Destroyed, Lost or Stolen
Rights Certificates . . . . . . . . . . . . . . . . . . . 10
7. Exercise of Rights; Exercise Price; Expiration Date of
Rights. . . . . . . . . . . . . . . . . . . . . . . . . . 11
8. Cancellation and Destruction of Rights Certificates . . . 14
9. Reservation and Availability of Shares of Preferred
Stock . . . . . . . . . . . . . . . . . . . . . . . . . . 14
10. Preferred Stock Record Date . . . . . . . . . . . . . . . 16
11. Adjustment of Exercise Price, Number and Kind of Shares
or Number of Rights . . . . . . . . . . . . . . . . . . . 17
12. Certification of Adjusted Exercise Price or Number of
Shares. . . . . . . . . . . . . . . . . . . . . . . . . . 25
13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power . . . . . . . . . . . . . . . . . . . . . . 26
14. Fractional Rights and Fractional Shares . . . . . . . . . 29
15. Rights of Action. . . . . . . . . . . . . . . . . . . . . 30
16. Agreement of Right Holders. . . . . . . . . . . . . . . . 31
17. Rights Certificate Holder Not Deemed a Stockholder. . . . 31
18. Concerning the Rights Agent . . . . . . . . . . . . . . . 32
19. Merger or Consolidation of, or Change in Name of, the
Rights Agent. . . . . . . . . . . . . . . . . . . . . . . 32
20. Duties of Rights Agent. . . . . . . . . . . . . . . . . . 33
21. Change of Rights Agent. . . . . . . . . . . . . . . . . . 35
22. Issuance of New Rights Certificates . . . . . . . . . . . 36
23. Redemption. . . . . . . . . . . . . . . . . . . . . . . . 37
24. Exchange. . . . . . . . . . . . . . . . . . . . . . . . . 38
25. Notice of Proposed Actions. . . . . . . . . . . . . . . . 40
26. Notices . . . . . . . . . . . . . . . . . . . . . . . . . 41
27. Supplements and Amendments. . . . . . . . . . . . . . . . 41
28. Successors. . . . . . . . . . . . . . . . . . . . . . . . 42
29. Benefits of this Rights Agreement . . . . . . . . . . . . 42
30. Determinations and Actions by the Board etc . . . . . . . 42
31. Tennessee Contract. . . . . . . . . . . . . . . . . . . . 43
32. Counterparts. . . . . . . . . . . . . . . . . . . . . . . 43
33. Descriptive Headings. . . . . . . . . . . . . . . . . . . 43
34. Severability. . . . . . . . . . . . . . . . . . . . . . . 43
Exhibit A -- Form of Articles of Amendment to Charter
creating Series C Junior Preferred Stock
Exhibit B -- Summary of Rights
Exhibit C -- Form of Rights Certificate
<PAGE>
RIGHTS AGREEMENT
Agreement, dated as of March 28, 1995, by and between
PROFFITT'S, Inc., a Tennessee corporation (the "Company"), and
Union Planters National Bank (the "Rights Agent").
W I T N E S S E T H :
WHEREAS, on March 28, 1995, the Board of Directors of the
Company authorized the issuance of, and declared a dividend
payable in, one right (a "Right") for each share of Common Stock,
$.10 par value per share, of the Company outstanding as of the
close of business on April 24, 1995 (the "Record Date"), each
such Right representing the right to purchase one one-hundredth
of a share of Series C Junior Preferred Stock of the Company
("Preferred Stock") having the rights and preferences set forth
in the form of Articles of Amendment attached hereto as Exhibit A
authorized by the Board of Directors on March 28, 1995, upon the
terms and subject to the conditions hereinafter set forth; and
WHEREAS, the Board of Directors of the Company further
authorized the issuance of one Right (subject to adjustment) with
respect to each share of Common Stock which may be issued between
the Record Date and the earlier to occur of the Redemption Date
or the Final Expiration Date (as such terms are hereinafter
defined);
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereby agree as
follows:
Section 1. Certain Definitions. For purposes of this
Agreement, the following terms shall 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 of such Person, shall be the Beneficial Owner (as
such term is hereinafter defined) of 20% or more of the
shares of any class of Voting Stock (as such term is
hereinafter defined) of the Company then outstanding;
provided that, an Acquiring Person shall not include an (i)
Exempt Person (as such term is hereinafter defined), or (ii)
any Person, together with all Affiliates and Associates of
such Person, who or which would be an Acquiring Person
solely by reason of (A) being the Beneficial Owner of shares
of Voting Stock of the Company, the Beneficial Ownership of
which was acquired by such Person pursuant to any action or
transaction or series of related actions or transactions
approved by the Board of Directors before such Person
otherwise became an Acquiring Person or (B) a reduction in
the number of issued and outstanding shares of Voting Stock
of the Company pursuant to a transaction or a series of
related transactions approved by the Board of Directors of
the Company (upon approval, in the case of subclauses (A)
and (B), by a majority of the Continuing Directors (as such
term is hereinafter defined): provided, further, that in the
event such Person described in this clause (ii) does not
become an Acquiring Person by reason of subclause (A) or (B)
of this clause (ii), such Person nonetheless shall become an
Acquiring Person in the event such Person thereafter
acquires Beneficial Ownership of any additional shares of
the Voting Stock of the Company, unless the acquisition of
such additional Voting Stock would not result in such Person
becoming an Acquiring Person by reason of subclause (A) or
(B) of this clause (ii). Notwithstanding the foregoing, if
the Board of Directors of the Company determines in good
faith (upon approval by a majority of the Continuing
Directors) that a Person who would otherwise be an
"Acquiring Person" as defined pursuant to the foregoing
provisions of this paragraph (a) has become such
inadvertently, and such Person divests as promptly as
practicable a sufficient number of shares of Common Stock so
that such Person would no longer be an "Acquiring Person" as
defined pursuant to the foregoing provisions of this
paragraph (a), then such Person shall not be deemed an
"Acquiring Person" for any purposes of this Rights
Agreement.
b. "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 ("Exchange Act"), as in
effect on the date of this Rights Agreement.
c. A person shall be deemed the "Beneficial Owner"
of, or to "Beneficially Own", any securities (and
correlative terms shall have correlative meanings);
(1) which such Person or any of such Person's
Affiliates or Associates beneficially owns, directly or
indirectly; or
(2) which such Person or any of such Person's
Affiliates or Associates has (A) the right to acquire
(whether such right is exercisable immediately or only
after the passage of time or the fulfillment of a
condition or both) pursuant to any agreement,
arrangement or understanding, or upon the exercise of
conversion rights, exchange rights, other rights (other
than these Rights), warrants or options, or otherwise;
provided, however, that a Person shall not be deemed
the "Beneficial Owner" of, or to "Beneficially Own",
securities tendered pursuant to a tender or exchange
offer made by such Person or any of such Person's
Affiliates or Associates until such tendered securities
are accepted for purchase or exchange or (B) the right
to vote, alone or in concert with others, pursuant to
any agreement, arrangement or understanding (whether or
not in writing); provided, however, that a Person shall
not be deemed the "Beneficial Owner" of, or to
"Beneficially Own", any securities if the agreement,
arrangement or understanding to vote such security (1)
arises solely from a revocable proxy or consent given
in response to a proxy or consent solicitation made
pursuant to, and in accordance with, the applicable
rules and regulations under the Exchange Act and (2) is
not at the time reportable by such Person on a Schedule
13D report under the Exchange Act (or any comparable or
successor report); or
(3) which are beneficially owned, directly or
indirectly, by any other Person with which such Person
or any of such Person's Affiliates or Associates has
any agreement, arrangement or understanding (whether or
not in writing) for the purpose of acquiring, holding,
voting (except as described in clause (B) of
subparagraph (ii) of this paragraph (c)) or disposing
of any securities of the Company.
Notwithstanding anything in this paragraph (c) to
the contrary, a Person shall not be deemed the
"Beneficial Owner" of, or to "Beneficially Own," any
security beneficially owned by another Person solely by
reason of an agreement, arrangement or understanding
with such other Person for the purposes of: (x)
soliciting the Company's stockholders for the election
of director nominees or any other stockholder
resolution, the formation of and membership on any
committee for the purpose of promoting or opposing any
stockholder resolution or for electing a slate of
nominees to the Company's Board of Directors, service
on such a slate of director nominees, or agreement to a
slate of director nominees, provided that such other
Person retains the right at any time to withdraw as a
nominee or member of any such committee, and to
withhold or revoke any vote or proxy for or against any
such stockholder resolution or for such slate of
nominees; (y) entering into revocable voting agreements
or the granting or soliciting of revocable proxies with
respect to any of the matters described in the
foregoing clause (x) or (z) the sharing of expenses and
the indemnification against expenses and liabilities by
any such other Person with respect to expenses incurred
or conduct occurring during the time such other Person
is a nominee or a member of any such committee
described in the foregoing clause (x). Further,
notwithstanding anything in this paragraph (c) to the
contrary, a Person engaged in the business of
underwriting securities shall not be deemed the
"Beneficial Owner" of, or to "Beneficially Own," any
securities acquired in good faith in a firm commitment
underwriting until the expiration of forty (40) days
after the date of such acquisition.
Notwithstanding anything in this paragraph (c) 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.
d. "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in
the State of New York are authorized or obligated by law or
executive order to close.
e. "Close of Business" on any given date shall mean
5:00 P.M., eastern standard time, on such date; provided,
however, that if such date is not a Business Day it shall
mean 5:00 P.M., eastern standard time, on the next
succeeding Business Day.
f. "Common Stock" when used with reference to the
Company shall mean the Common Stock (presently $.10 par
value) of the Company. "Common Stock" when used with
reference to any Person other than the Company which shall
be organized in corporate form shall mean the capital stock
or other equity security with the greatest per share voting
power of such Person or, if such other Person is a
Subsidiary of another Person, the Person or Persons which
ultimately control such first-mentioned Person. "Common
Stock" when used with reference to any Person other than the
Company which shall not be organized in corporate form shall
mean units of beneficial interest which shall represent the
right to participate in profits, losses, deductions and
credits of such Person and which shall be entitled to
exercise the greatest voting power per unit of such Person
or, if such other Person is a Subsidiary of another Person,
the Person or Persons which ultimately control such
first-mentioned Person.
g. "Continuing Director" shall mean any member of the
Board of Directors, while such person is a member of the
Board of Directors, who is not an Acquiring Person, or an
Affiliate or Associate of an Acquiring Person, or a
representative or nominee of an Acquiring Person or of any
such Affiliate or Associate, and who either (i) was a member
of the Board of Directors on the date of this Agreement or
(ii) subsequently became a member of the Board of Directors,
and whose nomination for election or election to the Board
of Directors was recommended or approved by a majority of
the Continuing Directors then on the Board of Directors.
h. "Distribution Date" shall have the meaning set
forth in Section 3(b) hereof.
i. "Exchange Act" shall have the meaning set forth in
Section l(b) hereof.
j. "Exempt Person" shall mean (i) the Company, (ii)
any Subsidiary of the Company or (iii) any employee benefit
plan or employee stock plan of the Company or any Subsidiary
of the Company, or any trust or other entity organized,
appointed, established or holding Common Stock for or
pursuant to the terms of any such plan.
k. "Exercise Price" shall have the meaning set forth
in Section 4 and 7(b) hereof.
l. "Fair Market Value" of any property shall mean the
fair market value of such property as determined in
accordance with Section 11(d) hereof.
m. "Final Expiration Date" shall have the meaning set
forth in Section 7(a) hereof.
n. "Person" shall mean any individual, firm,
corporation or other entity and shall include any successor
(by merger of otherwise) of such entity.
o. "Principal Party" shall have the meaning set forth
in Section 13(b) hereof.
p. "Redemption Date" shall have the meaning set forth
in Section 7(a) hereof.
q. "Redemption Price" shall have the meaning set
forth in Section 23(a) hereof.
r. "Rights Certificate" shall have the meaning set
forth in Section 3(d) hereof.
s. "Stock Acquisition Date" shall mean the first date
on which there shall be a public announcement by the Company
or an Acquiring Person that an Acquiring Person has become
such (which, for purposes of this definition, shall include,
without limitation, a report filed pursuant to Section 13(d)
of the Exchange Act) or such earlier date as a majority of
the Continuing Directors shall become aware that a person
has become an Acquiring Person.
t. "Subsidiary" of a Person shall mean any
corporation or other entity of which securities or other
ownership interests having voting power sufficient to elect
a majority of the board of directors or other persons
performing similar functions are beneficially owned,
directly or indirectly, by such Person or by any corporation
or other entity that is otherwise controlled by such Person.
u. "Summary of Rights" shall have the meaning set
forth in Section 3(a) hereof.
v. "Trading Day" shall have the meaning set forth in
Section 11(d) hereof.
w. "Transfer Tax" shall mean any tax or charge,
including any documentary stamp tax, imposed or collected by
any governmental or regulatory authority in respect of any
transfer of any security, instrument or right, including
Rights, shares of Common Stock and Shares of Preferred
Stock.
x. "Voting Stock" shall mean (i) the Common Stock of
the Company and (ii) any other shares of capital stock of
the Company entitled to vote generally in the election of
directors or entitled to vote together with the Common Stock
in respect of any merger, consolidation, sale of all or
substantially all of the Company's assets, liquidation,
dissolution or winding up, whether now or hereafter
authorized.
Section 2. Appointment of Rights Agent. The Company
hereby appoints the Rights Agent to act as agent for the Company
in accordance with the terms and conditions hereof, and the
Rights Agent hereby accepts such appointment. The Company may
from time to time appoint such Co-Rights Agents as it may deem
necessary or desirable.
Section 3. Issuance of Rights Certificates.
a. On the Record Date (or as soon as practicable
thereafter), the Company or the Rights Agent shall send a copy of
a Summary of Rights, in substantially the form attached hereto as
Exhibit B (the "Summary of Rights"), by first class mail, postage
prepaid, to each record holder of the Common Stock as of the
close of business on the Record Date, at the address of such
holder shown on the records of the Company.
b. Until the Close of Business on the day (or such
later date as may be determined by action of the Board of
Directors, upon approval by a majority of the Continuing
Directors) which is the earlier of (i) the tenth day after the
Stock Acquisition Date or (ii) the tenth business day after the
date of the commencement by any person (other than an Exempt
Person) of, or the first public announcement of the intent of any
Person (other than an Exempt Person) to commence, a tender or
exchange offer upon the successful consummation of which such
Person, together with its Affiliates and Associates, would be the
Beneficial Owner of 20% or more of any class of the then
outstanding shares of Voting Stock of the Company (irrespective
of whether any shares are actually purchased pursuant to any such
offer) (the earlier of such dates being herein referred to as the
"Distribution Date"), (x) the Rights shall be evidenced by the
certificates for Common Stock registered in the name of the
holders of Common Stock (together with, in the case of
certificates for Common Stock outstanding as of the Record Date,
the Summary of Rights) and not by separate Right certificates,
and the record holders of such certificates for Common Stock
shall be the record holders of the Rights represented thereby and
(y) each Right shall be transferable only simultaneously and
together with the transfer of a share of Common Stock (subject to
adjustment as hereinafter provided). Until the Distribution Date
(or, if earlier, the Redemption Date or Final Expiration Date),
the surrender for transfer of any certificate for Common Stock
shall constitute the surrender for transfer of the Right or
Rights associated with the Common Stock evidenced thereby,
whether or not accompanied by a copy of the Summary of Rights.
c. Rights shall be issued in respect of all
shares of Common Stock that become outstanding after the Record
Date but prior to the earliest of the Distribution Date, the
Redemption Date or the Final Expiration Date and, in certain
circumstances provided in Section 22 hereof, may be issued in
respect of shares of Common Stock that become outstanding after
the Distribution Date. Certificates for Common Stock issued
(including, without limitation, certificates issued upon original
issuance, disposition from the Company's treasury or transfer or
exchange of Common Stock) after the Record Date but prior to the
earliest of the Distribution Date, the Redemption Date, or the
Final Expiration Date (or, in certain circumstances as provided
in Section 22 hereof, after the Distribution Date) shall have
impressed, printed, written or stamped thereon or otherwise
affixed thereto the following legend:
This certificate also evidences and
entitles the holder hereof to the same number
of Rights (subject to adjustment) as the
number of shares of Common Stock represented
by this certificate, such Rights being on the
terms provided under the Rights Agreement
between Proffitt's, Inc. and Union Planters
National Bank (the "Rights Agent"), dated as
of March 28, 1995, as it may be amended from
time to time (the "Rights Agreement"), the
terms of which are incorporated herein by
reference and a copy of which is on file at
the principal executive offices of
Proffitt's, Inc. Under certain
circumstances, as set forth in the Rights
Agreement, such Rights shall be evidenced by
separate certificates and shall no longer be
evidenced by this certificate. Proffitt's,
Inc. shall mail to the registered holder of
this certificate a copy of the Rights
Agreement without charge after receipt of a
written request therefor. Under certain
circumstances as provided in Section 7(e) of
the Rights Agreement. Rights issued to or
Beneficially Owned by Acquiring Persons or
their Affiliates or Associates (as such terms
are defined in the Rights Agreement) or any
subsequent holder of such Rights shall be
null and void and may not be transferred to
any Person.
d. As soon as practicable after the Distribution
Date, the Company will prepare and execute, the Rights Agent will
countersign, and the Company will send or cause to be sent (and
the Rights Agent will, if requested, send), by first class mail,
postage prepaid, to each record holder of the Common Stock as of
the Close of Business on the Distribution Date, as shown by the
records of the Company, at the address of such holder shown on
such records, a certificate in the form provided by Section 4
hereof (a "Rights Certificate"), evidencing one Right (subject to
adjustment as provided herein) for each share of Common Stock so
held. As of and after the Distribution Date, the rights shall be
evidenced solely by Rights Certificates and may be transferred by
the transfer of the Rights Certificate as permitted hereby,
separately and apart from any transfer of one or more shares of
Common Stock.
Section 4. Form of Rights Certificates.
The Rights Certificates (and the forms of election to
purchase shares, certificate and assignment to be printed on the
reverse thereof), when, as and if issued, shall be substantially
in the form set forth in Exhibit C hereto and may have such marks
of identification or designation and such legends, summaries or
endorsements printed thereon as may be required to comply with
any law or with any rule or regulation made pursuant thereto or
with any rule or regulation of any stock exchange on which the
Common Stock or the Rights may from time to time be listed or as
the Company may deem appropriate to conform to usage or otherwise
and as are not inconsistent with the provisions of this Rights
Agreement. Subject to the provisions of Section 22 hereof, Rights
Certificates evidencing Rights whenever issued (i) shall be dated
as of the date of issuance of the Rights they represent and (ii)
subject to adjustment from time to time as provided herein, on
their face shall entitle the holders thereof to purchase such
number of shares (including fractional shares which are integral
multiples of one-hundredth of a share) of Preferred Stock as
shall be set forth therein at the price payable upon exercise of
a Right provided by Section 7(b) hereof as the same may from time
to time be adjusted as provided herein (the "Exercise Price").
Section 5. Countersignature and Registration.
a. Each Rights Certificate shall be executed on
behalf of the Company by its Chairman of the Board, President,
any Vice President or its Treasurer, either manually or by
facsimile signature. Each Rights Certificate shall be
countersigned by the Rights Agent manually and shall not be valid
for any purpose unless so countersigned. In case any officer of
the Company who shall have signed any Rights Certificate shall
cease to be such officer of the Company before countersignature
by the Rights Agent and issuance and delivery of the certificate
by the Company, such Rights Certificate, nevertheless, may be
countersigned by the Rights Agent and issued and delivered with
the same force and effect as though the person who signed such
Rights Certificates had not ceased to be such officer of the
Company. Any Rights Certificate may be signed on behalf of the
Company by any person who, on the 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.
b. Following the Distribution Date, the Rights Agent
will keep or cause to be kept, at its principal office or one or
more offices designated as the appropriate place for surrender of
Rights Certificates upon exercise or transfer, and in such other
locations as may be required by law, 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 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.
a. Subject to the provisions of Sections 7(e), 7(f),
14 and 24 hereof, at any time after the Close of Business on the
Distribution Date, and at or prior to the Close of Business on
the earlier of the Redemption Date or the Final Expiration Date,
any Rights Certificate may be (i) transferred or (ii) split up,
combined or exchanged for one or more other Rights Certificates,
entitling the registered holder to purchase a like number of
shares of Preferred Stock as the Rights Certificate or Rights
Certificates surrendered then entitled such holder to purchase.
Any registered holder desiring to transfer any Rights Certificate
shall surrender the Rights Certificate at the office of the
Rights Agent designated for the surrender of Rights Certificates
with the form of certificate and assignment on the reverse side
thereof duly endorsed (or enclosed with such Rights Certificate a
written instrument of transfer in form satisfactory to the
Company and the Rights Agent), duly executed by the registered
holder thereof or his attorney duly authorized in writing, and
with such signature duly guaranteed. Any registered holder
desiring to split up, combine or exchange any Rights Certificate
shall make such request in writing and deliver such request to
the Rights Agent, and shall surrender the Rights Certificate to
be split up, combined or exchanged at the office of the Rights
Agent designated therefor. Thereupon, the Rights Agent shall
countersign and deliver to the person entitled thereto a Rights
Certificate or Rights Certificates, as the case may be, as so
requested. The Company may require payment of a sum sufficient
to cover any Transfer Tax that may be imposed in connection with
any transfer, split up, combination or exchange of any Rights
Certificates.
b. Subject to the provisions of Sections 7(e), 7(f),
14 and 24 hereof, 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, if requested by the Company,
reimbursement to the Company and the Rights Agent of all
reasonable expenses incidental thereto, or upon surrender to the
Rights Agent and cancellation of the Rights Certificate if
mutilated, the Company shall issue and deliver a new Rights
Certificate of like tenor to the Rights Agent for delivery to the
registered owner in lieu of the Rights Certificate so lost,
stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Exercise Price;
Expiration Date of Rights.
a. The Rights shall not be exercisable until, and
shall become exercisable on, the Distribution Date (unless
otherwise provided herein, including, without limitation, the
restrictions on exercisability set forth in Sections 7(e) and 24
hereof). Except as otherwise provided herein, the Rights may be
exercised, in whole or in part, at any time commencing with the
Distribution Date upon surrender of the Rights Certificate (with
the form of election to purchase and certificate on the reverse
side thereof duly executed with signatures duly guaranteed), to
the Rights Agent at the principal office of the Rights Agent in
Memphis, Tennessee, together with payment of the Exercise Price
for each Right exercised, subject to adjustment as hereinafter
provided, at or prior to the Close of Business on the earliest of
(i) March 28, 2005 (the "Final Expiration Date"), (ii) the date
on which the Rights are redeemed as provided in Section 23 hereof
(the "Redemption Date") or (iii) the date on which such Rights
are exchanged as provided in Section 24 hereof.
b. The Exercise Price shall initially be $85 for each
one one-hundredth (l/l00) of a share of Preferred Stock issued
pursuant to the exercise of a Right. The Exercise Price and the
number of shares of Preferred Stock or other securities to be
acquired upon exercise of a Right shall be subject to adjustment
from time to time as provided in Sections 11 and 13 hereof. The
Exercise Price shall be payable in lawful money of the United
States of America, in accordance with paragraph (c) below.
c. Except as otherwise provided herein, upon receipt
of a Rights Certificate representing exercisable Rights with the
form of election to purchase and the certificate contained
therein duly executed, accompanied by payment by certified check,
cashier's check, bank draft or money order payable to the Company
of the Exercise Price for the shares to be purchased and an
amount equal to any applicable Transfer Tax required to be paid
by the holder of the Rights Certificate in accordance with
Section 9(e) hereof, the Rights Agent shall thereupon promptly
(i) requisition from any transfer agent of the Preferred Stock of
the Company one or more certificates representing the number of
shares of Preferred Stock to be so purchased, and the Company
hereby authorizes such transfer agent to comply with all such
requests, (ii) as provided in Section 14(b), at the election of
the Company, cause depositary receipts to be issued in lieu of
fractional shares of Preferred Stock, (iii) if the election
provided for in the immediately preceding clause (ii) has not
been made, requisition from the Company the amount of cash to be
paid in lieu of the issuance of fractional shares in accordance
with section 14(b) hereof, (iv) after receipt of such Preferred
Stock certificates and, if applicable, 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 (v) when
appropriate, after receipt, promptly deliver such cash to or upon
the order of the registered holder of such Rights Certificate;
provided, however, that in the case of a purchase of securities,
other than Preferred Stock, pursuant to Section 13 hereof, the
Rights Agent shall promptly take the appropriate actions
corresponding in such case to that referred to in the foregoing
clauses (i) through (v) of this Section 7(c). Notwithstanding
the foregoing provisions of this Section 7(c), the Company may
suspend the exercisability of the Rights for a period not in
excess of ninety (90) days, during which the Company seeks to
register under the Securities Act of 1933, as amended (the
"Act"), and any applicable securities law of any other
jurisdiction, the shares of Preferred Stock to be issued pursuant
to the Rights.
d. In case the registered holder of any Rights
Certificate shall exercise less than all the Rights evidenced
thereby, a new Rights Certificate evidencing Rights equivalent to
the Rights remaining unexercised shall be issued by the Rights
Agent to the registered holder of such Rights Certificate or his
assign, subject to the provisions of Section 14(b) hereof.
e. Notwithstanding any provision of this Rights
Agreement to the contrary, from and after the time (the
"invalidation time") when any Person first becomes an Acquiring
Person, any Rights that are beneficially owned by (x) such
Acquiring Person (or any Associate or Affiliate of such Acquiring
Person), (y) a transferee of such Acquiring Person (or any such
Associate or Affiliate) who becomes a transferee after the
invalidation time or (z) a transferee of such Acquiring Person
(or any such Associate or Affiliate) who becomes a transferee
prior to or concurrently with the invalidation time pursuant to
either (I) a transfer from the Acquiring Person to holders of its
equity securities or to any Person with whom it has any
continuing agreement, arrangement or understanding regarding the
transferred Rights or (II) a transfer which the Board of
Directors has determined is part of a plan, arrangement or
understanding which has the purpose or effect of avoiding the
provisions of this Section 7(e) (upon approval by a majority of
the Continuing Directors), and subsequent transferees of such
Persons referred to in clause (y) and (z) above, shall be void
without any further action and any holder of such Rights shall
thereafter have no rights whatsoever with respect to such Rights
under any provision of this Rights Agreement. The Company shall
use all reasonable efforts to ensure that the provisions of this
Section 7(e) are complied with, but shall have no liability to
any holder of Rights Certificates or any other Person as a result
of its failure to make any determination with respect to an
Acquiring Person or its Affiliates, Associates or transferees
hereunder. No Rights Certificate shall be issued pursuant to
Section 3 hereof that represents Rights beneficially owned by an
Acquiring Person whose Rights would be void pursuant to the
provisions of this Section 7(e) or any Associate or Affiliate
hereof; no Rights Certificate shall be issued at any time upon
the transfer of any Rights to an Acquiring Person whose Rights
would be void pursuant to the provisions of this Section 7(e) or
any Associate or Affiliate thereof or to any nominee of such
Acquiring Person, Associate or Affiliate; and any Rights
Certificate delivered to the Rights Agent for transfer to an
Acquiring Person whose Rights would be void pursuant to the
provisions of this Section 7(e) shall be canceled.
f. Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be
obligated to undertake any action with respect to a registered
holder upon the occurrence of any purported exercise as set forth
in this Section 7 unless such registered holder shall have (i)
completed and signed the certificate following the form of
election to purchase set forth on the reverse side of the Rights
Certificate surrendered for such exercise and (ii) provided such
additional evidence of the identity of the Beneficial Owner (or
former 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, transfer, split up, combination or exchange
shall, if surrendered to the Company or to any of its agents, be
delivered to the Rights Agent for cancellation or in canceled
form, or, if surrendered to the Rights Agent, shall be canceled
by it, and no 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
cancel and retire, any Rights Certificate purchased or acquired
by the Company otherwise than upon the exercise thereof. The
Rights Agent shall deliver all canceled Rights Certificates to
the Company, or shall, at the written request of the Company,
destroy such canceled Rights Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Shares of
Preferred Stock.
a. The Company covenants and agrees that it will
cause to be reserved and kept available out of its authorized and
unissued shares of Preferred Stock or out of its authorized and
issued shares of Preferred Stock held in its treasury, such
number of shares of Preferred Stock as will from time to time be
sufficient to permit the exercise in full of all outstanding
Rights and, after the occurrence of an event described in Section
11(a)(ii) or Section 13(a), shall, to the extent reasonably
practicable, so reserve and keep available a sufficient number of
shares of Common Stock (and/or other securities) which may be
required to permit the exercise in full of all outstanding
Rights.
b. If the Preferred Stock (or, following the
occurrence of an event described in Section 11(a)(ii) or Section
13(a), the Common Stock and/or other securities) is at any time
listed on a national securities exchange or included for
quotation on any transaction reporting system, then so long as
the Preferred Stock (and, following the occurrence of any such
event, Common Stock and/or other securities) issuable and
deliverable upon exercise of the Rights may be listed on such
exchange or included for quotation on any such transaction
reporting system, the Company shall use its best efforts to
cause, from and after such time as the Rights become exercisable
(but only to the extent that it is reasonably likely that the
Rights will be exercised), all shares reserved for such issuance
to be listed on such exchange or included for quotation on any
such transaction reporting system upon official notice of
issuance upon such exercise.
c. The Company covenants and agrees that it will take
all such action as may be necessary to insure that all shares of
Preferred Stock delivered upon the exercise of Rights (or,
following the occurrence of an event described in Section
11(a)(ii) or Section 13(a), shares of Common Stock and/or other
securities) shall, at the time of delivery of the certificates
for such shares or other securities (subject to payment of the
Exercise Price in respect thereof), be duly and validly
authorized and issued and fully paid and nonassessable.
d. The Company shall use its best efforts to (i)
file, as soon as practicable following the occurrence of an event
described in Section 11(a)(ii), or as soon as is required by law
following the Distribution Date, as the case may be, a
registration statement under the Act, with respect to the
Preferred Stock 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)
until the earlier of (a) the date as of which the Rights are no
longer exercisable for such securities, and (b) the date of the
expiration of the Rights. The Company may temporarily suspend,
for a period of time not to exceed ninety (90) days, the
exercisability of the Rights in order to prepare and file a
registration statement under the Act and permit it to become
effective. The Company will also take such action as may be
appropriate under, or to ensure compliance with, the securities
or "blue sky" laws of the various states in connection with the
exercisability of the Rights. Notwithstanding any provision of
this Agreement to the contrary, the Rights shall not be
exercisable in any jurisdiction unless the requisite
qualification in such jurisdiction shall have been obtained and
until a registration statement under the Act (if required) shall
have been declared effective.
e. The Company covenants and agrees that it will pay
when due and payable any and all U.S. federal and state Transfer
Taxes which may be payable in respect of the issuance or delivery
of the Rights Certificates or of any shares of Preferred Stock
(or, following the occurrence of an event described in Section
11(a)(ii) or Section 13(a), Common Stock and/or other securities)
issued or delivered upon the exercise of Rights. The Company
shall not, however, be required to pay any Transfer Tax which may
be payable in respect of any transfer or delivery of a Rights
Certificate to a Person other than, or the issuance or delivery
of certificates for Preferred Stock (or, following the occurrence
of an event described in Section 11(a)(ii) or Section 13(a),
Common Stock and/or other securities) upon exercise of Rights in
a name other than that of, the registered holder of the Rights
Certificate, and the Company shall not be required to issue or
deliver a Rights Certificate or certificate for Preferred Stock
(or, following the occurrence of an event described in Section
11(a)(ii) or Section 13(a), Common Stock and/or other securities)
to a Person other than such registered holder until any such
Transfer Tax shall have been paid (any such Transfer tax being
payable by the holder of such Rights Certificate at the time of
surrender) or until it has been established to the Company's
satisfaction that no such Transfer Tax is due.
Section 10. Preferred Stock 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 securities
represented thereby on, and such certificate shall be dated as
of, the date upon which the Rights Certificate evidencing such
Rights was duly surrendered and payment of the Exercise Price
(and any applicable Transfer Taxes) was made; provided, however,
that, if the date of such surrender and payment is a date upon
which the Preferred Stock (or Common Stock and/or other
securities, as the case may be) transfer books of the Company are
closed, such Person shall be deemed to have become the record
holder of such shares on, and such certificate shall be dated as
of, the next succeeding Business Day on which the applicable
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 stockholder of
the Company with respect to shares for which the Rights shall be
exercisable, including, without limitation, the right to vote, to
receive dividends or other distributions or to exercise any
preemptive rights, and shall not be entitled to receive any
notice of any proceedings of the Company, except as provided
herein.
Section 11. Adjustment of Exercise Price, Number and
Kind of Shares or Number of Rights. The Exercise Price, the
number and kind of shares which may be purchased upon exercise of
a Right and the number of Rights outstanding are subject to
adjustment from time to time as provided in this Section 11.
a.(1) 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 Preferred Stock, (B)
subdivide the outstanding Preferred Stock, (C) combine
the outstanding Preferred Stock into a smaller number
of shares of Preferred Stock 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), the
Exercise 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 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, he 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 exercise of one Right If an
event occurs which would require an adjustment under
both this Section 11(a)(i) and Section 11(a)(ii)
hereof, the adjustment provided for in this Section
11(a)(i) shall be in addition to, and shall be made
prior to, any adjustment required pursuant to this
Section 11(a)(ii).
(2) Subject to Section 24 of this Agreement,
in the event that any Person (other than an Exempt
Person), alone or together with its Affiliates and
Associates, shall become an Acquiring Person, then,
except as otherwise provided in this Section 11, each
holder of a Right, except as provided in Section 7(e)
hereof, shall thereafter have the right to receive upon
exercise of such Right at a price equal to the then
current Exercise Price multiplied by the number of one
one-hundredths of a share of Preferred Stock for which
a Right is then exercisable, in accordance with the
terms of this Agreement and in lieu of Preferred Stock,
such number of shares of Common Stock of the Company as
shall equal the result obtained by (x) multiplying the
then current Exercise Price by the number of one
one-hundredths of a share of Preferred Stock for which
a Right is then exercisable and dividing that product
by (y) 50% of the Fair Market Value of the Company's
Common Stock (determined pursuant to Section 11(d)
hereof) on the date of the occurrence of such event;
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 lieu of issuing Common Stock in
accordance with Section 11(a)(ii) hereof, the Company
may, if the Board of Directors of the Company, upon
approval by a majority of the Continuing Directors,
determines that such action is necessary or appropriate
and not contrary to the interest of holders of Rights
(and, in the event that the number of shares of Common
Stock which are authorized by the Company's Charter but
not outstanding or reserved for issuance for purposes
other than upon exercise of the Rights are not
sufficient to permit the exercise in full of the
Rights, the Company shall): (A) determine the excess
of (1) the value of the Common Stock issuable upon the
exercise of a Right (the "Current Value") over (2) the
Exercise Price (such excess being referred to as the
"Spread") and (B) with respect to each Right, make
adequate provision to substitute for such Common Stock,
upon exercise of the Rights, (1) cash, (2) a reduction
in the Exercise Price, (3) other equity securities of
the Company (including, without limitation, shares or
units of shares of any series of preferred stock which
the Board of Directors of the Company, upon approval by
a majority of the Continuing Directors, has deemed to
have the same value as Common Stock (such shares or
units of shares of preferred stock are herein called
"common stock equivalents")), (4) debt securities of
the Company, (5) other assets or (6) any combination of
the foregoing, having an aggregate value equal to the
Current Value, where such aggregate value has been
determined by the Board of Directors of the Company,
upon approval by a majority of the Continuing
Directors; provided, however, if the Company shall not
have made adequate provision to deliver value pursuant
to clause (B) above within thirty (30) days following
the occurrence of an event described in Section
11(a)(ii), then the Company shall be obligated to
deliver, upon the surrender for exercise of a Right and
without requiring payment of the Exercise Price, Common
Stock (to the extent available), and then, if
necessary, cash, which shares and/or cash have an
aggregate value equal to the Spread. If the Board of
Directors, upon approval by a majority of the
Continuing Directors, shall determine in good faith
that it is likely that sufficient additional Common
Stock could be authorized for issuance upon exercise in
full of the Rights, the thirty (30) day period set
forth above may be extended to the extent necessary,
but not more than ninety (90) days after the occurrence
of an event described in Section 11(a)(ii), in order
that the Company may seek stockholder approval for the
authorization of such additional shares. To the extent
that the Company determines that some action need be
taken pursuant to the preceding sentences of this
Section 11(a)(iii), the Company may suspend the
exercisability of the Rights until the expiration of
any such period, as extended, in order to seek any
authorization of additional shares and/or to decide the
appropriate form of distribution to be made pursuant to
this Section 11(a)(iii) and to determine the value
thereof ln the event of any such suspension, the
Company shall issue a public announcement stating that
the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such
time as the suspension is no longer in effect and shall
promptly notify the Rights Agent of such suspension.
For purposes of this Section 11(a)(iii), the value of
the Common Stock shall be the Fair Market Value (as
determined pursuant to Section 11(d) hereof) per share
of the Common Stock at the Close of Business on the
date of the occurrence of one of the events described
in Section 11(a)(ii) and the value of any "common stock
equivalent" shall be deemed to have the same value as
the Common stock on such date.
b. In the event that the Company shall, after the
Record Date, fix a record date for the issuance of 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 Stock (or
shares having the same 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 equivalent preferred
stock (or having a conversion price per share, if a security
convertible into Preferred Stock or equivalent preferred stock)
less than the Fair Market Value per share of the Preferred Stock
(as defined in Section 11(d)) on such record date, the Exercise
Price to be in effect after such record date shall be determined
by multiplying the Exercise 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 the 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
Fair Market Value 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 exercise of one Right.
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 Exercise Price shall
be adjusted to be the Exercise Price which would then be in
effect if such record date had not been fixed.
c. In case the Company shall fix a record date for
the making of a distribution to all holders of the Preferred
Stock (including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing or
surviving corporation) or evidences of indebtedness or assets
(other than a regular quarterly cash dividend or a dividend
payable in Preferred Stock) or subscription rights or warrants
(excluding those referred to in Section 11(b) hereof), the
Exercise Price to be in effect after such record date shall be
determined by multiplying the Exercise Price in effect
immediately prior to such record date by a fraction, the
numerator of which shall be the Fair Market Value per share of
the Preferred Stock on such record date, less the Fair Market
Value of the portion of the assets or evidences of indebtedness
so to be distributed or of such subscription rights or warrants
applicable to one share of Preferred Stock and the denominator of
which shall be the Fair Market Value 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 Exercise Price shall again be adjusted to be the
Exercise Price which would then be in effect if such record date
had not been fixed.
d. For the purpose of this Rights Agreement, the
"Fair Market Value" of any share of Preferred Stock, Common Stock
or any other stock or any Rights or other security or any other
property on any date shall be determined as provided in this
Section 11(d). In the case of a publicly-traded stock or other
security, the Fair Market Value on any date shall be deemed to be
the average of the daily closing prices per share of such stock
or per unit of such other security for the 30 consecutive Trading
Days (as such term is hereinafter defined) immediately prior to
such date; provided, however, that in the event that the Fair
Market Value per share of any security is determined during a
period which includes any date that is within 30 Trading Days
after (i) the ex-dividend date for a dividend or distribution on
such security payable in shares of such security or securities
convertible into Shares of such security, or (ii) the effective
date of any subdivision, split, combination, consolidation,
reverse stock split or reclassification of such security, then,
and in each such case, the Fair Market Value shall be
appropriately adjusted by the Board of Directors of the Company
to take into account ex-dividend or post-effective date trading.
The closing price for any day shall be the last sale price,
regular way, or, in case no such sale takes place on such day,
the average of the closing bid and asked prices, regular way (in
either case, as reported in the applicable transaction reporting
system with respect to securities listed or admitted to trading
on the New York Stock Exchange), or, if the securities are not
listed or admitted to trading on the New York Stock Exchange, as
reported in the applicable transaction reporting system with
respect to securities listed on the principal national securities
exchange on which such security is listed or admitted to trading;
or, if not listed or admitted to trading on any national
securities exchange, the last quoted price (or, if not so quoted,
the average of the high bid and low asked prices) in the
over-the-counter market, as reported by the National Association
of Securities Dealers, Inc. Automated Quotation System ("NASDAQ")
or such other system then in use; or, if no bids for such
security are quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional
market maker making a market in such security selected by the
Board of Directors of the Company (upon approval by a majority of
the Continuing Directors). The term "Trading Day" shall mean a
day on which the principal national securities exchange on which
such security is listed or admitted to trading is open for the
transaction of business or, if such security is not listed or
admitted to trading on any national securities exchange, a
Business Day. If a security is not publicly held or not so
listed or traded, "Fair Market Value" shall mean the fair value
per share of stock or per other unit of such other security, as
determined in good faith by the Board of Directors of the Company
(upon approval by a majority of the Continuing Directors);
provided, however, that, if the Preferred Stock is not publicly
traded, the Fair Market Value of a share of Preferred Stock shall
be conclusively deemed to be the Fair Market Value of a share of
Common Stock (appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after the date
hereof), multiplied by one hundred. In the case of property
other than securities, the "Fair Market Value" thereof shall be
determined in good faith by the Board of Directors of the Company
(upon approval by a majority of the Continuing Directors). Any
such determination of Fair Market Value shall be described in a
statement filed with the Rights Agent and shall be binding upon
the Rights Agent and the holders of the Rights.
e. All calculations under this Section 11 shall be
made to the nearest cent or to the nearest one one-hundredth of a
share, as the case may be. No adjustment in the Exercise Price
shall be required unless adjustment would require an increase or
decrease of at least 1% in such 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. Notwithstanding the
preceding sentence, any adjustment required by this Section 11
shall be made no later than the earlier of (i) three years from
the date of the transaction which mandates the adjustment or (ii)
the date of the expiration of the right to exercise the Rights.
f. Irrespective of any adjustment or change in the
Exercise Price or the number of shares of Preferred Stock
issuable upon the exercise of the Rights, the Rights Certificates
theretofore and thereafter issued may continue to express the
Exercise Price and the number of shares to be issued upon
exercise of the Rights as in the initial Right Certificates
issued hereunder but, nevertheless, shall represent the Rights as
so adjusted.
g. Before taking any action that would cause an
adjustment reducing the purchase price per whole share of
Preferred Stock upon exercise of the Rights below the then par
value, if any, of the shares of Preferred Stock, the Company
shall use its best efforts to take any corporate action which
may, in the opinion of its counsel, be necessary in order that
the Company may validly and legally issue fully paid and
non-assessable shares of such Preferred Stock at such adjusted
purchase price per share.
h. If, as a result of an adjustment made pursuant to
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 Preferred Stock contained
in Sections 11(a), (b), (c), (e), (f), (g), (i), (j) and (k), and
the provisions of Sections 7, 9, 10, 13 and 14 with respect to
the Preferred Stock shall apply on like terms to any such other
shares.
i. Unless the Company shall have exercised its
election as provided in Section 11(j), upon each adjustment of
the Exercise Price as a result of the calculations made in
Sections 11(b) and (c), each Right outstanding immediately prior
to the making of such adjustment shall thereafter evidence the
right to purchase, at the adjusted Exercise Price, that number of
one one-hundredth of a share of Preferred Stock (calculated to
the nearest one one-millionth of a share) obtained by (i)
multiplying (x) the number of one one-hundredths of a share
covered by a Right immediately prior to this adjustment by (y)
the Exercise Price in effect immediately prior to such adjustment
of the Exercise Price and (ii) dividing the product so obtained
by the Exercise Price in effect immediately after such adjustment
of the Exercise Price.
j. The Company may elect on or after the date of any
adjustment of the Exercise Price to adjust the number of Rights,
in substitution for any adjustment in the number of one
one-hundredths 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-hundredths 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 Exercise Price in effect immediately prior to
adjustment of the Exercise Price by the Exercise Price in effect
immediately after adjustment of the Exercise 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 Exercise
Price is adjusted or any day thereafter, but, if the Rights
Certificates have been issued, it 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(j), 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 14 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 shall be registered in the names of the holders of
record of Rights Certificates on the record date specified in the
public announcement.
k. Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such
reductions in the Exercise 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 consolidation or subdivision of the
Preferred Stock, issuance wholly for cash of any Preferred Stock
at less than the current market price, issuance wholly for cash
of Preferred Stock or securities which by their terms are
convertible into or exchangeable for Preferred Stock, dividends
on Preferred Stock payable in Preferred Stock or issuance of
rights, options or warrants referred to hereinabove in Section
11(b), hereafter made by the Company to holders of its Preferred
Stock shall not be taxable to such stockholders.
l. 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 Common Stock payable
in Common Stock or (ii) effect a subdivision, combination or
consolidation of the Common Stock (by reclassification or
otherwise than by payment of dividends in Common Stock) into a
greater or lesser number of shares of Common Stock, then in any
such case (A) the number of one one-hundredths of a share of
Preferred Stock purchasable after such event upon proper exercise
of each Right shall be determined by multiplying the number of
one one-hundredths of a share of Preferred Stock so purchasable
immediately prior to such event by a fraction, the numerator of
which is the number of shares of Common Stock outstanding
immediately before such event and the denominator of which is the
number of shares of Common Stock outstanding immediately after
such event, and (B) each share of Common Stock outstanding
immediately after such event shall have issued with respect to it
that number of Rights which each share of Common Stock
outstanding immediately prior to such event had issued with
respect to it. The adjustments provided for in this Section
11(l) shall be made successively whenever such a dividend is
declared or paid or such a subdivision, combination or
consolidation is effected.
Section 12. Certification of Adjusted Exercise Price
or Number of Shares. Whenever an adjustment is made as provided
in Section 11 or Section 13, the Company shall (a) promptly
prepare a certificate setting forth such adjustment, and a brief
statement of the facts giving rise to such adjustment, (b)
promptly file with the Rights Agent and with each transfer agent
for the Preferred Stock a copy of such certificate and (c) mail a
brief summary thereof to each holder of a Rights Certificate in
accordance with Section 25. Notwithstanding the foregoing
sentence, the failure of the Company to make such certification
or give such notice shall not affect the validity of or the force
or effect of the requirement for such adjustment. Any adjustment
to be made pursuant to Section 11 or Section 13 of this Rights
Agreement shall be effective as of the date of the event giving
rise to such adjustment. The Rights Agent shall be fully
protected in relying on any such certificate and on any
adjustment therein contained and shall not be deemed to have
knowledge of any adjustment unless and until it shall have
received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power.
a. Except for any transaction approved by the Board
of Directors (upon approval by a majority of the Continuing
Directors), in the event that, at any time on or after the
Distribution Date, (x) the Company shall, directly or indirectly,
consolidate with, or merge with and into, any other Person or
Persons and the Company shall not be the surviving or continuing
corporation of such consolidation or merger, or (y) any Person or
Persons shall, directly or indirectly, consolidate with, or merge
with and into, the Company, and the Company shall be the
continuing or surviving corporation of such consolidation or
merger and, in connection with such consolidation or merger, all
or part of the outstanding shares of Common Stock shall be
changed into or exchanged for stock or other securities of any
other Person or of the Company or cash or any other property, or
(z) the Company or one or more of its Subsidiaries shall,
directly or indirectly, sell or otherwise transfer to any other
Person or any Affiliate or Associate of such Person, in one or
more transactions, or the Company or one or more of its
Subsidiaries shall sell or otherwise transfer to any Persons in
one or a series of related transactions, assets or earning power
aggregating more than 50% of the assets or earning power of the
Company and its Subsidiaries (taken as a whole), then, on the
first occurrence of any such event, proper provision shall be
made so that (i) each holder of record of a Right, except as
provided in Section 7(e) hereof, shall thereafter have the right
to receive, upon the exercise thereof and payment of the Exercise
Price in accordance with the terms of this Rights Agreement, such
number of shares of validly issued, fully paid, nonassessable and
freely tradeable Common Stock of the Principal Party (as defined
herein), not subject to any liens, encumbrances, rights of first
refusal or other adverse claims, as shall, based on the Fair
Market Value of the Common Stock of the Principal Party on the
date of the consummation of such consolidation, merger, sale or
transfer, equal to twice the Exercise Price; (ii) such Principal
Party shall thereafter be liable for, and shall assume, by virtue
of such consolidation, merger, sale or transfer, all the
obligations and duties of the Company pursuant to this Rights
Agreement; (iii) the term "Company" for all purposes of this
Rights Agreement shall thereafter be deemed to refer to such
Principal Party; (iv) such Principal Party shall take such steps
(including, but not limited to, the reservation of a sufficient
number of shares of its Common Stock in accordance with the
provisions of Section 9 hereof) in connection with such
consummation as may be necessary to assure that the provisions
hereof shall thereafter be applicable, as nearly as reasonably
may be, in relation to its shares of Common Stock thereafter
deliverable upon the exercise of the Rights; and (v) the
provisions of Section 11(a)(ii) hereof shall be of no effect
following the occurrence of any event described in clause (x),
(y) or (z) above of this Section 13(a). The provisions of this
Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers.
b. "Principal Party" shall mean
(1) in the case of any transaction described
in (x) or (y) of the first sentence of Section 13(a) hereof: (A)
the Person that is the issuer of the securities into which shares
of Common Stock of the Company are changed or otherwise exchanged
or converted in such merger or consolidation, or, if there is
more than one such issuer, the issuer of the Common Stock of
which has the greatest market value or (B) if no securities are
so issued, (x) the Person that is the other party to the merger
or consolidation and that survives such merger or consolidation,
or, if there is more than one such Person, the Person the Common
Stock of which has the greatest market value or (y) if the Person
that is the other party to the merger or consolidation does not
survive the merger or consolidation, the Person that does survive
the merger or consolidation (including the Company if its
survives); and
(2) in the case of any transaction described in
(z) of the first sentence in Section 13(a), the Person that is
the party receiving the greatest portion of the assets or earning
power transferred pursuant to such transaction or transactions,
or, if each Person that is a party to such transaction or
transactions receives the same portion of the assets or earning
power so transferred or if the Person receiving the greatest
portion of the assets or earning power cannot be determined,
whichever of such Persons is the issuer of Common Stock having
the greatest market value of shares outstanding; provided,
however, that in any such case, if the Common Stock of such
Person is not at such time and has not been continuously over the
preceding 12-month period registered under Section 12 of the
Exchange Act, and such Person is a direct or indirect Subsidiary
of another Person, the Common Stock of which is and has been so
registered, the term "Principal Party" shall refer to such other
Person, or if such Person is a Subsidiary, directly or
indirectly, of more than one Person, the Common Stocks of all of
which are and have been so registered, the term "Principal Party"
shall refer to whichever of such Persons is the issuer of the
Common Stock having the greatest market value of shares
outstanding.
c. The Company shall not consummate any
consolidation, merger or sale or transfer of assets or earning
power referred to in Section 13(a) unless the Principal Party
shall have a sufficient number of authorized shares of its Common
Stock that have not been issued or reserved for issuance to
permit exercise in full of all Rights in accordance with this
Section 13 and unless prior thereto the Company and the Principal
Party involved therein shall have executed and delivered to the
Rights Agent an agreement confirming that the Principal Party
shall, upon consummation of such consolidation, merger or sale or
transfer of assets or earning power, assume this Rights Agreement
in accordance with Section 13(a) hereof and that all rights of
first refusal or preemptive rights in respect of the issuance of
shares of Common Stock of the Principal Party upon exercise of
outstanding Rights have been waived and that such transaction
shall not result in a default by the Principal Party under this
Rights Agreement, and further providing that, as soon as
practicable after the date of any consolidation, merger or sale
or transfer of assets or earning power referred to in Section
13(a) hereof, the Principal Party will:
(1) 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, use its best efforts to cause such
registration statement to become effective as soon as
practicable after such filing and use its best efforts
to cause such registration statement to remain
effective (with a prospectus at all times meeting the
requirements of the Act) until the date of expiration
of the Rights, and similarly comply with applicable
state securities laws;
(2) use its best efforts to list (or continue the
listing of) the Rights and the securities purchasable
upon exercise of the Rights on a national securities
exchange or to meet the eligibility requirements for
quotation on NASDAQ; and
(3) deliver to holders of the Rights historical
financial statements for the Principal Party which
comply in all respects with the requirements for
registration on Form 10 (or any successor form) under
the Exchange Act. In the event that any of the
transactions described in section 13(a) hereof shall
occur at any time after the occurrence of a transaction
described in Section 11(a)(ii) hereof, the Rights which
have not theretofore been exercised shall, subject to
the provisions of Section 7(e) hereof, thereafter be
exercisable in the manner described in Section 13(a).
d. In case the Principal Party, which is to be a
party to a transaction referred to in this Section 13, has a
provision in any of its authorized securities or in its Charter
or By-laws or any other instrument governing its corporate
affairs, which provision would have the effect of (i) causing
such Principal Party to issue, in connection with, or as a
consequence of, the consummation of a transaction referred to in
this Section 13, shares of Common Stock of such Principal Party
at less than the then Fair Market Value per share (determined
pursuant to Section 11(b) hereof) or securities exercisable for,
or convertible into Common Stock of such Principal Party at less
than such then Fair Market Value (other than to holders of Rights
pursuant to this Section 13) or (ii) providing for any special
tax or similar payment in connection with the issuance to any
holder of a Right of Common Stock of such Principal Party
pursuant to the provisions of this Section 13, then, in such
event, the Company shall not consummate any such transaction
unless prior thereto the Company and such Principal Party shall
have executed and delivered to the Rights Agent a supplemental
agreement providing that the provision in question of such
Principal Party shall have been canceled, waived or amended, or
that the authorized securities shall be redeemed, so that the
applicable provision will have no effect on the benefits intended
to be afforded by the Rights in connection with, or as a
consequence of, the consummation of the proposed transaction.
Section 14. 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 (i.e., Rights to acquire less than one
one-hundredth of a share of Preferred Stock). If the Company
shall determine not to issue such fractional Rights, then, in
lieu of such fractional Rights, there shall be paid to the
holders of record of the Rights Certificates, with regard to
which such fractional Rights would otherwise be issuable, an
amount in cash equal to the same fraction of the Fair Market
Value of a whole Right.
b. The Company shall not be required to issue
fractions of shares of Preferred Stock (other than fractions
which are integral multiples of one-hundredth of a share) upon
exercise of the Rights or to distribute certificates which
evidence fractional shares (other than fractions which are
integral multiples of one-hundredth of a share). In lieu of
issuing fractions of shares of Preferred Stock, the Company may,
at its election, issue depositary receipts evidencing fractions
of shares 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 of the rights, privileges and preferences
to which they would be entitled as owners of the Preferred Stock.
With respect to fractional shares that are not integral multiples
of one-hundredth of a share, if the Company does not issue such
fractional shares or depositary receipts in lieu thereof, there
shall be paid to the holders of record of Rights Certificates at
the time such Rights Certificates are exercised, as herein
provided, an amount in cash equal to the same fraction of the
Fair Market Value of a share of Preferred Stock.
c. The holder of a Right, by the acceptance of a
Right, expressly waives his right to receive any fractional Right
or any fractional shares of Preferred Stock (other than fractions
which are integral multiples of one one-hundredth of a share)
upon exercise of a Right.
Section 15. Rights of Action. All rights of action in
respect of this Rights Agreement, except the rights of action
given to the Rights Agent in Section 18 hereof, are vested in the
respective registered holders of the Rights Certificates (and,
prior to the Distribution Date, the holders of record of the
Common Stock); and any holder of record 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 or her own behalf and for his or
her 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 or her right to exercise the
Rights evidenced by such Rights Certificate in the manner
provided in such Rights Certificate and in this Rights 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 Rights Agreement and will be entitled to
specific performance of the obligations under, and injunctive
relief against actual or threatened violations of, the
obligations of any Person subject to this Rights Agreement.
Section 16. Agreement of Right Holders. Each holder
of a Right, by accepting the Right, consents and agrees with the
Company and the Rights Agent and with every other holder of a
Right that:
a. prior to the Distribution Date, the Rights shall
be evidenced by the certificates for Common Stock registered
in the name of the holders of Common Stock (together, as
applicable, with the Summary of Rights). Certificates for
Common Stock rather than Rights Certificates shall also
constitute certificates for Rights, and such Rights shall be
transferable only simultaneously and together with the
transfer of shares 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 office of the Rights
Agent designated for such purpose, duly endorsed or
accompanied by a proper instrument of transfer;
c. 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
d. 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 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 17. 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 Preferred Stock or any other securities
which may at any time be issuable on the exercise of the Rights
represented thereby, nor shall anything contained herein or in
any Rights Certificate be construed to confer upon the holder of
any Rights Certificate, as such, any of the rights of a
stockholder of the Company or any right to vote for the election
of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give or withhold consent to any corporate
action, or to receive notice of meetings or other actions
affecting stockholders (except as provided in Section 25 hereof),
or to receive dividends 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 18. Concerning the Rights Agent.
a. The Company agrees to pay to the Rights Agent
reasonable compensation for all services rendered by it hereunder
and, from time to time, on demand of the Rights agent, its
reasonable expenses and counsel fees and other disbursements
incurred in the administration and execution of this Rights
Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent
for, and to hold it harmless against, any loss, liability, or
expense, incurred without gross negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything done or
omitted to be done by the Rights Agent in connection with the
acceptance and administration of this Rights Agreement, including
the cost and expenses of defending against any claim of liability
relating to the Rights or this Rights Agreement.
b. The Rights Agent shall be protected against, and
shall incur no liability for or in respect of, any action taken,
suffered or omitted by it in connection with its administration
of this Rights Agreement in reliance upon any Rights Certificate
or certificate for Preferred Stock or for other securities of the
Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent,
certificate, statement or other 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.
Section 19. Merger or Consolidation of, or Change in
Name of, the Rights Agent.
a. Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to the
corporate trust or stock transfer business of the Rights Agent or
any successor Rights Agent, shall be the successor to the Rights
Agent under this Rights Agreement without the execution or filing
of any paper or any further act on the part of any of the parties
hereto, provided that such corporation would be eligible for
appointment as a successor Rights Agent under the provisions of
Section 21 hereof. In case at the time such successor Rights
Agent shall succeed to the agency created by this Rights
Agreement and 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
Rights Agent or in the name of the successor Rights Agent; and in
all such cases such Rights Certificates shall have the full force
provided in the Rights Certificates and in this Rights Agreement.
b. 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; 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; in all such cases such
Rights Certificates shall have the full force provided in the
Rights Certificates and in this Rights Agreement.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this Rights
Agreement upon the following terms and conditions, by all of
which the Company and the holders of Rights Certificates by their
acceptance thereof shall be bound:
a. The Rights Agent may consult with legal counsel
(who may be legal counsel for the Company), and the opinion of
such counsel shall be full and complete authorization and
protection to the Rights Agent as to any action taken or omitted
by it in good faith and in accordance with such opinion.
b. Whenever in the performance of its duties under
this Rights Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter be proved or established by the
Company prior to taking or suffering any action hereunder, such
fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively
proved and established by a certificate signed by any one of the
following: Chairman of the Board, the President, any Vice
President, the Treasurer or the Secretary of the Company and
delivered to the Rights Agent. Any such certificate shall be
full authorization to the Rights Agent for any action taken or
suffered in good faith by it under the provisions of this Rights
Agreement in reliance upon such certificate.
c. The Rights Agent shall be liable hereunder only
for its own gross negligence, bad faith or willful misconduct.
d. The Rights Agent shall not be liable for any of
the statements of fact or recitals contained in this Rights
Agreement or in the Rights Certificates (except its
countersignature thereof) or be required to verify the same; and
all such statements and recitals are and shall be deemed to have
been made by the Company only.
e. The Rights Agent shall not have any responsibility
with respect to the validity of this Rights Agreement or the
execution and delivery hereof (except the due execution hereof by
the Rights Agent) or with respect to 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 Rights Agreement or in
any Rights Certificate; nor shall it be responsible for 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
receipt of a certificate describing any such adjustment); 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 to be issued pursuant to this
Rights Agreement or any Rights Certificate or as to whether any
shares of Preferred Stock will, when issued, be validly
authorized and issued, fully paid and nonassessable.
f. The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts,
instruments and assurances as may reasonably be required by the
Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of the Rights Agreement.
g. The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its
duties hereunder from the Chairman of the Board, the President or
any Vice President or the Secretary or the Treasurer of the
Company, and to apply to such officers for advice or instructions
in connection with its duties, and it shall not be liable for any
action taken or suffered to be taken by it in good faith in
accordance with instructions of any such officer.
h. The Rights Agent and any shareholder, director,
officer or employee of the Rights Agent may buy, sell or deal in
any of the Rights or other securities of the Company or become
pecuniarily interested in any transaction in which the Company
may be interested, or contract with or lend money to the Company
or otherwise act as fully and freely as though it were not the
Rights Agent under this Rights Agreement. Nothing herein shall
preclude the Rights Agent from acting in any other capacity for
the Company or for any other legal entity.
i. The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents,
and the Rights Agent shall not be answerable or accountable for
any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct provided reasonable care was
exercised in the selection and continued employment thereof.
j. If, with respect to any Rights Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate following the form of election to purchase set forth
on the reverse side of such Rights Certificate has either not
been completed or indicates an affirmative response to clause 1
and/or 2 thereof, the Rights Agent shall not take further action
with respect to the requested exercise or transfer without first
consulting with the Company.
Section 21. Change of Rights Agent. The Rights Agent
or any successor Rights Agent may resign and be discharged from
its duties under this Rights Agreement upon 30 days notice in
writing mailed to the Company and to each transfer agent of the
Common Stock and the Preferred Stock by registered or certified
mail. The Company may remove the Rights Agent or any successor
Rights Agent (with or without cause) upon 30 days notice in
writing, mailed to the Rights Agent or successor Rights Agent, as
the case may be, and to each transfer agent of the Common Stock
and the Preferred Stock by registered or certified mail. If the
Rights Agent shall resign or be removed or shall otherwise become
incapable of acting, the Company shall appoint a successor to the
Rights Agent. Notwithstanding the foregoing provisions of this
Section 21, in no event shall the resignation or removal of a
Rights Agent be effective until a successor Rights Agent shall
have been appointed and have accepted such appointment. If the
Company shall fail to make such appointment within a period of 30
days after such removal or after it has been notified in writing
of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the holder of a Rights
Certificate (who shall, with such notice, submit his Rights
Certificate for inspection by the Company), then the incumbent
Rights Agent or the holder of record 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 thereof, in good standing, which is
authorized under such laws to exercise corporate trust or stock
transfer powers and is subject to supervision or examination in
the conduct of its corporate trust or stock transfer business by
federal or state authorities and which has at the time of its
appointment as Rights Agent a combined capital and surplus of at
least $50,000,000 or (b) an Affiliate controlled by 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 21, however, or any defect therein,
shall not affect the legality or validity of the resignation or
removal of the Rights Agent or the appointment of the successor
Rights Agent, as the case may be. Notwithstanding the foregoing
provisions, in the event of resignation, removal or incapacity of
the Rights Agent, the Company shall have the authority to act as
the Rights Agent until a successor Rights Agent shall have
assumed the duties of the Rights Agent hereunder.
Section 22. Issuance of New Rights Certificates.
Notwithstanding any of the provisions of this Rights 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 Exercise Price per share and the
number or kind or class of shares of stock or other securities or
property purchasable under the Rights certificates made in
accordance with the provisions of this Rights Agreement.
Section 23. Redemption.
a. The Company may, at its option, but only by the
vote of a majority of the Board of Directors (upon approval by a
majority of the Continuing Directors) redeem all but not less
than all of the then outstanding Rights, at any time prior to the
Close of Business on the earlier of (i) the tenth day following
the Stock Acquisition Date (subject to extension by the Company
as provided in Section 27 hereof) or (ii) the Final Expiration
Date, at a redemption price of $.01 per Right, appropriately
adjusted to reflect any stock split, stock dividend or similar
transaction after the date hereof (the "Redemption Price").
b. Without any further action and without any notice,
the right to exercise the Rights will terminate at the effective
time of the action of the Board of Directors ordering the
redemption of the Rights and the only right thereafter of the
holders of Rights shall be to receive the Redemption Price.
Within 10 days after the effective time of the action of the
Board of Directors ordering the redemption of the Rights, the
Company shall give notice of such redemption to the holders of
the then outstanding Rights by mailing such notice to all such
holders at their last addresses as they appear upon the registry
books of the Rights Agent or, prior to the Distribution Date, on
the registry books of the transfer agent for the Common Stock.
Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice;
provided, however, that the failure to give, or any defect in,
any such notice shall not affect the validity of such redemption.
Each notice of redemption will state the method by which the
payment of the Redemption Price will be made. At the option of
the Board of Directors, the Redemption Price may be paid in cash
to each Rights holder or by the issuance of shares (and, at the
Company's election pursuant to Section 14(b) hereof, cash or
depositary receipts in lieu of fractions of shares other than
fractions which are integral multiples of one one-hundredth
(1/100) of a share) of Preferred Stock having a Fair Market Value
equal to such cash payment.
Section 24. Exchange.
a. By the vote of a majority of the Board of
Directors (upon approval by a majority of the Continuing
Directors), 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 which have become void pursuant to Section 7(e) hereof)
for shares of Common Stock at an exchange rate of one share of
Common Stock per Right, appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring
after the date hereof (the "Exchange Ratio"). Notwithstanding
the foregoing, the Board of Directors shall not be empowered to
effect such exchange at any time after any Person (other than an
Exempt Person), together with all Affiliates and Associates of
such Person, becomes the Beneficial Owner of 50% or more of any
class of voting stock of the Company then outstanding.
b. Without any further action and without any notice,
the right to exercise the Rights to be so exchanged will
terminate at the effective time of the action of the Board of
Directors ordering the exchange and the only right thereafter of
each 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 notice of the exchange to the holders of such
Rights then outstanding by mailing such notice to all such
holders at their last addresses as they appear upon the registry
books of the Rights Agent or, prior to the Distribution Date, on
the registry books of the transfer agent for the Common Stock.
Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice;
provided, however, that the failure to give, or any defect in,
any such notice shall not affect the validity of such exchange.
Each such notice shall state the method by which the exchange for
rights will be effected and, in the event of a 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 Section
7(e) hereof) held by each holder of Rights.
c. In any exchange pursuant to this Section 24, the
Company, at its option, may substitute shares of Preferred Stock
for shares of Common Stock exchangeable for the Rights, at the
initial rate of one one-hundredth of a share of Preferred Stock
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 delivered in lieu of each share of Common Stock
shall have the same voting rights as one share of Common Stock.
d. In the event that there shall not be sufficient
shares of Common Stock or Preferred Stock issued but not
outstanding or authorized but unissued to permit any exchange of
Rights as contemplated in accordance with this Section 24, the
Company shall either take such action as may be necessary to
authorize additional Common Stock or Preferred Stock for issuance
upon exchange of the Rights or, alternatively, by the vote of a
majority of the Board of Directors (upon approval by a majority
of the Continuing Directors), with respect to each Right, (i) pay
cash in an amount equal to the Exercise Price, in lieu of issuing
Common Stock or Preferred Stock in exchange therefor, or (ii)
issue debt or equity securities, or a combination thereof, having
a value equal to the Current Value (as hereinafter defined) of
the Common Stock or Preferred Stock exchangeable for each such
Right, where the value of such securities shall be determined in
good faith by the Board of Directors (upon approval by a majority
of the Continuing Directors), or (iii) deliver any combination of
cash, property, Common Stock, Preferred Stock and/or other
securities having a value equal to the Current Value in exchange
for each Right. The term "Current Value," for purposes of this
Section 24, shall mean the product of the per share market price
of the Common Stock (determined pursuant to Section 11(d) on the
date of the occurrence of the event described above in
subparagraph (a)), multiplied by the number of shares of Common
Stock for which the Right otherwise would be exchangeable if
there were sufficient shares available. To the extent that the
Company determines that some action need be taken pursuant to
clauses (i), (ii) or (iii) of this Section 24(d), the Board of
Directors (upon approval by a majority of the Continuing
Directors) may temporarily suspend the exercisability of the
Rights for a period of up to sixty (60) days following the date
on which the event described in Section 24(a) shall have
occurred, in order to seek any authorization of additional Common
Stock or Preferred Stock and/or to decide the appropriate form of
distribution to be made pursuant to the above provision and to
determine the value thereof. In the event of any such
suspension, the Company shall issue a public announcement stating
that the exercisability of the Rights has been temporarily
suspended.
e. The Company shall not be required to issue
fractions of shares of Common Stock or to distribute certificates
which evidence fractional shares of Common Stock. In lieu of
such fractional shares of Common Stock, the Company shall pay to
each registered holder of a Rights Certificate with regard to
which a fractional share of Common Stock would otherwise be
issuable, an amount in cash equal to the same fraction of the
fair market value of a whole share of Common Stock. For the
purposes of this paragraph (e), the fair market value of a whole
share of Common Stock shall be the closing price of a share of
Common Stock (as determined pursuant to Section 11(d) hereof) for
the Trading Day immediately prior to the date of exchange
pursuant to this Section 24.
Section 25. Notice of Proposed Actions.
a. In case the Company, after the Distribution Date,
shall propose (i) to pay any dividend payable in stock of any
class to the holders of its Preferred Stock or to make any other
distribution to the holders of its Preferred Stock (other than a
regular quarterly cash dividend), (ii) to offer to the holders of
its Preferred Stock rights or warrants to subscribe for or to
purchase any additional Preferred Stock or shares of stock of any
class or any other securities, rights or options, (iii) to effect
any reclassification of its Preferred Stock (other than a
reclassification involving only the subdivision of outstanding
Preferred Stock), (iv) to effect any consolidation or merger with
or into, or to effect any sale or other transfer (or to permit
one or more of its Subsidiaries to effect any sale or other
transfer), in one or more transactions, of more than 50% of the
assets or earning power of the Company and its Subsidiaries
(taken as a whole) to, any other Person or Persons, or (v) to
effect the liquidation, dissolution or winding up of the Company,
then, in each such case, the Company shall give to each holder of
record of a Rights Certificate, in accordance with Section 26,
notice of such proposed action, which shall specify the record
date for the purposes of such stock dividend or distribution of
rights or warrants, or the date on which such reclassification,
consolidation, merger, sale or transfer, liquidation,
dissolution, or winding up is to take place and the date of
participation therein by the holders of record of Common Stock or
Preferred Stock, if any such date is to be fixed, and such notice
shall be so given in the case of any action covered by clause (i)
or (ii) above at least ten (10) days prior to the record date for
determining holders of record of the Preferred Stock for purposes
of such action, and in the case of any such other action, at
least ten (10) days prior to the date of the taking of such
proposed action or the date of participation therein by the
holders of record of Common Stock or Preferred Stock, whichever
shall be the earlier. The failure to give notice required by
this Section 25 or any defect therein shall not affect the
legality or validity of the action taken by the Company or the
vote upon any such action.
b. In case any event described in Section 11(a)(ii)
hereof shall occur, then the Company shall, as soon as
practicable thereafter, give to each holder of a Rights
Certificate, in accordance with Section 26 hereof, a notice of
the occurrence of such event, which notice shall describe such
event and the consequences of such event to holders of Rights
under Section 11(a)(ii) hereof.
Section 26. Notices. Notices or demands authorized by
this Rights Agreement to be given or made by the Rights Agent or
by the holder of record 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:
Proffitt's, Inc.
115 North Calderwood
Alcoa, Tennessee 37703
Attention: Secretary
Subject to the provisions of Section 21, any notice or demand
authorized by this Rights Agreement to be given or made by the
Company or by the holder of record of any Rights Certificate or
Right to or on the Rights Agent shall be sufficiently given or
made if sent by first-class mail, postage prepaid, addressed
(until another address is filed in writing with the Company) as
follows:
Union Planters National Bank
6200 Poplar Avenue, 3rd Floor
Memphis, Tennessee 38119
Attention: Corporate Trust Department
Notices or demand authorized by this Rights Agreement to be given
or made by the Company or the Rights Agent to the holder of
record of any Rights Certificate or Right 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 27. Supplements and Amendments. For as long
as the Rights are then redeemable and except as provided in the
last sentence of this Section 27, the Company may in its sole and
absolute discretion, and the Rights Agent shall if the Company so
directs, supplement or amend any provision of this Agreement
without the approval of any holders of the Rights. At any time
when the Rights are not then redeemable and except as provided in
the last sentence of this Section 27, the Company may, and the
Rights Agent shall if the Company so directs, supplement or amend
this Rights Agreement without the approval of any holders of
Rights Certificates (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 or (iii) to
change or supplement the provisions hereunder in any manner which
the Company may deem necessary or desirable, provided that no
such supplement or amendment pursuant to this clause (iii) shall
materially adversely affect the interest of the holders of Rights
Certificates. 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 27, the Rights Agent shall execute such supplement or
amendment. Notwithstanding anything contained in this Rights
Agreement to the contrary, supplements or amendments may be made
only upon approval by a majority of the Continuing Directors.
Section 28. Successors. All of the covenants and
provisions of this Rights 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 29. Benefits of this Rights Agreement.
Nothing in this Rights 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 holders of Common Stock in
their capacity as holders of the Rights) any legal or equitable
right, remedy or claim under this Rights Agreement; but this
Rights Agreement shall be for the sole and exclusive benefit of
the Company, the Rights agent and the holders of record of the
Rights Certificates (and, prior to the Distribution Date, the
holders of Common Stock in their capacity as holders of the
Rights).
Section 30. Determinations and Actions by the Board
etc. The Board of Directors (upon approval by a majority of the
Continuing Directors) shall have the exclusive power and
authority to administer this Agreement and to exercise all rights
and powers specifically granted to the Board, or to 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. All such actions,
calculations, interpretations and determinations (including, for
purposes of clause (y) below, all omissions with respect to the
foregoing) which are done or made by the Board of Directors in
good faith and with the approval of a majority of the Continuing
Directors then in office in accordance with the preceding
sentence, shall (x) be final, conclusive and binding on the
Company, the Rights Agent, the holders of the Rights and all
other parties and (y) shall not subject any director to any
liability from the holders of the Rights.
Notwithstanding anything contained in this Agreement to
the contrary, whenever any action, calculation, interpretation or
determination made pursuant to this Agreement requires the
approval of a majority of the Continuing Directors, and no
Continuing Directors are then in office, such action,
calculation, interpretation or determination may not be made.
Section 31. Tennessee Contract. This Rights Agreement
and each Rights Certificate issued hereunder shall be deemed to
be a contract made under the laws of the State of Tennessee and
for all purposes shall be governed by and construed and enforced
in accordance with the laws of such state applicable to contracts
to be made and performed entirely within such state.
Section 32. Counterparts. This Rights 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 33. Descriptive Headings. Descriptive
headings of the several Sections of this Rights Agreement are
inserted for convenience only and shall not control or affect the
meaning or construction of any of the provisions hereof.
Section 34. Severability. If any term, provision,
covenant or restriction of this Rights 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 Rights Agreement shall remain
in full force and effect and shall in no way be affected,
impaired or invalidated.
IN WITNESS WHEREOF, the parties hereto have caused this
Rights Agreement to be duly executed, all as of the day and year
first above written.
PROFFITT'S, INC.
Attest: Julia A. Bentley
By: /s/ R. Brad Martin
Name: R. Brad Martin, Chairman
and Chief Executive Officer
UNION PLANTERS NATIONAL BANK
Attest: Delories Duncan By: /s/ Anne Mathes
Name: Anne Mathes, Vice President
<PAGE>
EXHIBIT A
ARTICLE OF AMENDMENT TO THE CHARTER
of
PROFFITT'S, INC.
Pursuant to the provisions of Section 6.02 of the Tennessee
Business Corporation Act, the undersigned corporation adopts the
following Articles of Amendment to its Charter.
A. The name of the corporation is PROFFITT'S, INC. (the
"Corporation").
B. The Charter is amended by establishing a series of
authorized preferred stock having a par value of $1.00 per share,
which series shall be designated as "Series C Junior Preferred
Stock" (the "Series C Junior Preferred Stock"), shall consist of
200,000 shares and shall have the following voting powers,
preferences and relative, participating, optional and other
special rights, and the qualifications, limitations and
restrictions thereof as follows:
Section 1. Dividends and Distributions.
(A) Subject to the rights of the holders of any
shares of any series of Preferred Stock (or any similar stock)
ranking prior and superior to the Series C Junior Preferred Stock
with respect to dividends, the holders of shares of Series C
Junior Preferred Stock, in preference to the holders of Common
Stock, par value $.10 per share (the "Common Stock"), of the
Corporation, and of any other junior stock, shall be entitled to
receive, when, as and if declared by the Board of Directors out
of funds legally available for the purpose, quarterly dividends
payable in cash on the first day of March, June, September and
December in each year (each such date being referred to herein as
a "Quarterly Dividend Payment Date"), commencing on the first
Quarterly Dividend Payment Date after the first issuance of a
share or fraction of a share of Series C Junior Preferred Stock,
in an amount per share (rounded to the nearest cent) equal to the
greater of (a) $1 or (b) subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share amount
of all cash dividends, and 100 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 C Junior Preferred Stock. In the event the Corporation
shall at any time declare or pay any dividend on the Common Stock
payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the
amount to which holders of shares of Series C Junior 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 C Junior Preferred Stock as provided
in paragraph (A) of this Section immediately after it declares a
dividend or distribution on the Common Stock (other than a
dividend payable in shares of Common Stock); provided that, in
the event no dividend or distribution shall have been declared on
the Common Stock during the period between any Quarterly Dividend
Payment Date and the next subsequent Quarterly Dividend Payment
Date, a dividend of $1 per share on the Series C Junior 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 C Junior Preferred
Stock from the Quarterly Dividend Payment Date next preceding the
date of issue of such shares, unless the date of issue of such
shares is prior to the record date for the first Quarterly
Dividend Payment Date, in which case, dividends on such shares
shall begin to accrue from the date of issue of such shares, or
unless the date of issue is a Quarterly Dividend Payment Date or
is a date after the record date for the determination of holders
of shares of Series C Junior 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 C Junior 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 C Junior
Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be not
more than sixty (60) days prior to the date fixed for the payment
thereof.
Section 2. Voting Rights. The holders of shares of
Series C Junior Preferred Stock shall have the following voting
rights:
(A) Subject to the provision for adjustment
hereinafter set forth, each share of Series C Junior Preferred
Stock shall entitle the holder thereof to 100 votes on all
matters submitted to a vote of the stockholders of the
Corporation. In the event the Corporation shall at any time
declare or pay any dividend on the Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the number of votes per
share to which holders of shares of Series C Junior Preferred
Stock were entitled immediately prior to such event shall be
adjusted by multiplying such number by a fraction, the numerator
of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the
number of shares of Common on Stock that were outstanding
immediately prior to such event.
(B) Except as otherwise provided herein, in any
other Articles of Amendment creating a series of Preferred Stock
or any similar stock, or Bylaw, the holders of shares of Series C
Junior Preferred Stock and the holders of shares of Common Stock
and any other capital stock of the Corporation having general
voting rights shall vote together as one class on all matters
submitted to a vote of stockholders of the Corporation.
(C) Except as set forth herein, or as otherwise
provided by law, holders of Series C Junior 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 3. Certain Restrictions.
(A) Whenever quarterly dividends or other
dividends or distributions payable on the Series C Junior
Preferred Stock as provided in Section 1 are in arrears,
thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series C
Junior Preferred Stock outstanding shall have been paid in full,
the Corporation shall not:
(1) declare or pay dividends, or make any
other distributions, on any shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or
winding up) to the Series C Junior Preferred Stock;
(2) declare or pay dividends, 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 C Junior
Preferred Stock, except dividends paid ratably on the Series
C Junior 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;
(3) redeem or purchase or otherwise acquire
for consideration shares of any stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding
up) to the Series C Junior Preferred Stock, provided that
the Corporation may at any time redeem, purchase or
otherwise acquire shares of any such junior stock in
exchange for shares of any stock of the Corporation ranking
junior (as to dividends and upon dissolution, liquidation
and winding up) to the Series C Junior Preferred Stock; or
(4) redeem or purchase or otherwise acquire
for consideration any shares of Series C Junior Preferred
Stock, or any shares of stock ranking on a parity (either as
to dividends or upon liquidation, dissolution or winding up)
with the Series C Junior Preferred Stock, except in
accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of
Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences of
the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the
respective series or classes.
(B) The Corporation shall not permit any subsidiary of
the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the Company unless the
Corporation could, under paragraph (A) of this Section 3,
purchase or otherwise acquire such shares at such time and in
such manner.
Section 4. Reacquired Shares. Any shares of Series C
Junior Preferred Stock purchased or otherwise acquired by the
Company in any manner whatsoever shall be retired and canceled
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 subject to the conditions and restrictions on
issuance set forth herein, in the Charter, or in any other
Articles of Amendment creating a series of Preferred Stock or any
similar stock or as otherwise required by law.
Section 5. Liquidation Dissolution or Winding Up.
Upon any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (1) to the holders of
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series C Junior
Preferred Stock unless, prior thereto, the holders of shares of
Series C Junior Preferred Stock shall have received $1.00 per
share, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of
such payment, provided that the holders of shares of Series C
Junior Preferred Stock shall be entitled to receive an aggregate
amount per share, subject to the provision for adjustment
hereinafter set forth, equal to 100 times the aggregate amount to
be distributed per share to holders of shares of Common Stock, or
(2) to the holders of shares of stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding up)
with the Series C Junior Preferred Stock, except distributions
made ratably on the Series C Junior Preferred Stock and all such
parity stock in proportion to the total amounts to which the
holders of all such shares are entitled upon such liquidation,
dissolution or winding up. In the event the Corporation shall,
at any time, declare or pay any dividend on the Common Stock
payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the
aggregate amount to which holders of shares of Series C Junior
Preferred Stock were entitled immediately prior to such event
under the proviso in clause (1) of the preceding sentence shall
be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 6. 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
each share of Series C Junior Preferred Stock shall at the same
time be similarly exchanged or changed into an amount per share,
subject to the provision for adjustment hereinafter set forth,
equal to 100 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
declare or pay any dividend on the Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the amount set forth in
the preceding sentence with respect to the exchange or change of
shares of Series C Junior Preferred Stock shall be adjusted by
multiplying such amount by a fraction, the numerator of which is
the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to
such event.
Section 7. No Redemption. The shares of Series C
Junior Preferred Stock shall not be redeemable.
Section 8. Rank. The Series C Junior Preferred Stock
shall rank, with respect to the payment of dividends and the
distribution of assets, junior to all series of any other class
of the Corporation's Preferred Stock.
Section 9. Amendment. The Amended and Restated
Charter of the Corporation shall not be amended in any manner
which would materially alter or change the powers, preferences or
special rights of the Series C Junior Preferred Stock so as to
affect them adversely without the affirmative vote of the holders
of at least a majority of the outstanding shares of Series C
Junior Preferred Stock, voting together as a single class.
(C) The Amendment was duly adopted on March 28, 1995
by the Board of Directors of the Corporation.
IN WITNESS WHEREOF, the Corporation has caused these
Articles of Amendment to be duly executed by R. Brad Martin, its
Chairman and Chief Executive Officer, and attested by Julia A.
Bentley, its Secretary, this ____ day of ______________, 1995.
PROFFITT'S, INC.
By:___________________________
R. Brad Martin, Chairman
and Chief Executive Officer
ATTEST:
By:____________________________
Julia A. Bentley, Secretary
<PAGE>
EXHIBIT B
UNDER CERTAIN CIRCUMSTANCES AS PROVIDED IN THE
RIGHTS AGREEMENT (AS REFERRED TO BELOW), RIGHTS
ISSUED TO OR BENEFICIALLY OWNED BY ACQUIRING
PERSONS OR THEIR AFFILIATES OR ASSOCIATES (AS SUCH
TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR ANY
SUBSEQUENT HOLDER OF SUCH RIGHTS SHALL BE NULL AND
VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.
PROFFITT'S, INC.
SUMMARY OF RIGHTS TO PURCHASE
SERIES C JUNIOR PREFERRED STOCK
On March 28, 1995, the Board of Directors of
Proffitt's, Inc. (the "Company") declared a dividend distribution
of one preferred stock purchase right (a "Right") for each
outstanding share of Common Stock, par value $.10 per share (the
"Common Stock"), of the Company. The distribution is payable as
of April 24, 1995 to stockholders of record on that date. Each
Right entitles the registered holder to purchase from the Company
one one-hundredth (1/100) of a share of preferred stock of the
Company, designated as Series C Junior Preferred Stock (the
"Preferred Stock") at a price of $85 per one one-hundredth
(1/100) of a share ("Exercise Price"), subject to adjustment.
The description and terms of the Rights are set forth in a Rights
Agreement, dated as of March 28, 1995 (the "Rights Agreement"),
between the Company and Union Planters National Bank, as Rights
Agent (the "Rights Agent").
As discussed below, initially the Rights will not be
exercisable, certificates will not be sent to stockholders and
the Rights will automatically trade with the Common Stock.
The Rights become exercisable upon the close of
business on the day (the "Distribution Date") which is the
earlier of (i) the tenth day following a public announcement that
a person or group of affiliated or associated persons, with
certain exceptions set forth below, has acquired beneficial
ownership of 20% or more of any class of the outstanding voting
stock of the Company (an "Acquiring Person") and (ii) the tenth
business day after the date of the commencement or announcement
of a person's or group's intention to commence a tender or
exchange offer the consummation of which would result in the
ownership of 20% or more of any class of the Company's
outstanding voting stock (even if no shares are actually
purchased pursuant to such offer), or such later date as may be
determined by the Board of Directors and the Continuing
Directors; prior thereto, the Rights will not be exercisable,
will not be represented by a separate certificate, and will not
be transferable apart from the Company's Common Stock, but will
instead be evidenced, with respect to any of the Common Stock
certificates outstanding as of April 24, 1995, by such Common
Stock certificate with a copy of this Summary of Rights attached
thereto. An Acquiring Person does not include (A) the Company,
(B) any subsidiary of the Company, (C) any employee benefit plan
or employee stock plan of the Company or of any subsidiary of the
Company, or any trust or other entity organized, appointed,
established or holding Common Stock for or pursuant to the terms
of any such plan or (D) any person or group whose ownership of
20% or more of the shares of any class of voting stock of the
Company then outstanding results solely from (i) any action or
transaction or transactions approved by the Board of Directors
and the Continuing Directors (as defined in the Rights Agreement)
before such person or group became an Acquiring Person or (ii) a
reduction in the number of issued and outstanding shares of
voting stock of the Company pursuant to a transaction or
transactions approved by the Board of Directors and the
Continuing Directors (provided that any person or group that does
not become an Acquiring Person by reason of clause (i) or (ii)
above shall become an Acquiring Person upon acquisition of any
additional shares of the Company's voting stock unless such
acquisition of additional voting stock will not result in such
person or group becoming an Acquiring Person by reason of such
clause (i) or (ii)).
Until the Distribution Date (or earlier redemption or
expiration of the Rights), new Common Stock certificates issued
after April 24, 1995 will contain a legend incorporating the
Rights Agreement by reference. Until the Distribution Date (or
earlier redemption or expiration of the Rights), the surrender
for transfer of any of the Common Stock certificates outstanding
as of April 24, 1995, with or without a copy of this Summary of
Rights attached thereto, 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
such separate certificates alone will evidence the Rights from
and after the Distribution Date.
The Rights are not exercisable until the Distribution
Date. The Rights will expire at the close of business on March
28, 2005, unless earlier redeemed or exchanged by the Company, in
each case as described below.
The Preferred Stock is nonredeemable and, unless
otherwise provided in connection with the creation of a
subsequent series of preferred stock, subordinate to any other
series of the Company's preferred stock. Each share of Preferred
Stock will be entitled to a minimum quarterly dividend payment of
$1.00 per share but will be entitled to an aggregate dividend of
100 times the dividend declared on the Company's Common Stock.
In the event of the liquidation of the Company, the holders of
Preferred Stock will be entitled to receive a minimum payment of
$100.00 per share but will be entitled to an aggregate payment of
100 times the payment made per share of Common Stock. Each share
of Preferred Stock will have 100 votes, voting together with the
Common Stock In the event of any merger, consolidation or other
transaction in which Common Stock is exchanged, each share of
Preferred Stock will be entitled to receive 100 times the amount
received per share of Common Stock. The rights of Preferred
Stock as to dividends, liquidation and voting are protected by
anti-dilution provisions.
The Exercise Price payable, and the number of shares of
Preferred Stock or other securities or property issuable, upon
exercise of the Rights are subject to adjustment from time to
time to prevent dilution 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 or purchase
Preferred Stock at a price, or securities convertible into
Preferred Stock with a conversion price, less than the then
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 periodic cash dividends
paid out of earnings or retained earnings or dividends payable in
Preferred Stock) or of subscription rights or warrants (other
than those referred to above).
The number of outstanding Rights and the number of one
one-hundredths of a share of Preferred Stock issuable upon
exercise of such Right are also subject to adjustment in the
event of a stock split of the Common Stock or a 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.
Unless the transaction is approved by the Board of
Directors and the Continuing Directors, in the event that, after
the time the Rights become exercisable, the Company were to be
acquired in a merger or other business combination (in which any
shares of Common Stock are changed into or exchanged for other
securities or assets) or more than 50% of the assets or earning
power of the Company and its subsidiaries (taken as a whole) were
to be sold or transferred in one or a series of related
transactions, the Rights Agreement provides that proper provision
will be made so that each holder of record of a Right will from
and after such date have the right to receive, upon payment of
the Exercise Price, that number of shares of common stock of the
acquiring company having a market value at the time of such
transaction equal to two times the Exercise Price. In addition,
in the event that a person or group of affiliated or associated
persons becomes an Acquiring Person, the Rights Agreement
provides that proper provision will be made so that each holder
of record of a Right, other than the Acquiring Person (whose
Rights will thereupon become null and void), will thereafter have
the right to receive, upon payment of the Exercise Price, that
number of shares of the Common Stock (or cash, other securities
or property) having a market value at the time of the transaction
equal to two times the Exercise Price (such market value to be
determined with reference to the market value of the Company's
Common Stock as provided in the Rights Agreement).
Fractions of shares of Preferred Stock (other than
fractions which are integral multiples of one one-hundredth of a
share) may, at the election of the Company, be evidenced by
depositary receipts. The Company may also issue cash in lieu of
fractional shares which are not integral multiples of one
one-hundredth of a share.
At any time on or prior to the close of business on the
earlier of (i) the tenth day after the time that a person (or
group of affiliated or associated persons) has become an
Acquiring Person (or such later date as a majority of the Board
of Directors and the Continuing Directors may determine) or (ii)
March 28, 2005, the Company may redeem the Rights in whole, but
not in part, at a price of $.01 per Right (the "Redemption
Price"), with the approval of the Continuing Directors.
Immediately upon the effective time of the action of the Board of
Directors of the Company authorizing 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.
For as long as the Rights are then redeemable, the
Company may amend the Rights in any manner, including an
amendment to extend the time period in which the Rights may be
redeemed. At any time when the Rights are not then redeemable,
the Company may amend the Rights in any manner that does not
materially adversely affect the interests of holders of the
Rights as such. Amendments to the Rights Agreement require the
approval of the Continuing Directors.
At any time after a person (or group of affiliated or
associated persons) becomes an Acquiring Person and prior to the
acquisition by any such person or group of 20% or more of any
class of outstanding voting stock of the Company, the Board of
Directors of the Company (with the approval of the Continuing
Directors) may exchange the Rights (other than Rights owned by
such person or group which have become void), in whole or in
part, at an exchange ratio of one share of Common Stock (or a
fraction of a share of Preferred Stock or other consideration
having equivalent market value) per Right (subject to
adjustment).
Until a Right is exercised, the holder, as such, will
have no rights as a stockholder of the Company, including,
without limitation, the right to vote or to receive dividends.
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an Exhibit to a
Registration Statement on Form 8-A dated ________ __ , 1995. A
copy of the Rights Agreement is available free of charge from the
Company. This summary description of the Rights does not purport
to be complete and is qualified in its entirety by reference to
the Rights Agreement which is incorporated herein by reference.
<PAGE>
EXHIBIT C
[Form of Rights Certificate]
Certificate No. R- ___________ Rights
NOT EXERCISABLE AFTER MARCH 28, 2005 OR EARLIER IF
REDEMPTION OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO
REDEMPTION AT THE OPTION OF THE COMPANY AT $.01 PER RIGHT
AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, AS PROVIDED IN THE
RIGHTS AGREEMENT (AS REFERRED TO BELOW), RIGHTS ISSUED TO OR
BENEFICIALLY OWNED BY ACQUIRING PERSONS OR THEIR AFFILIATES
OR ASSOCIATES (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS SHALL BE
NULL AND VOID AND MAY NOT BE TRANSFERRED TO ANY PERSON.
Rights Certificate
PROFFITT'S, INC.
This certifies that ________________________, or
registered assigns, is the registered owner of the number of
Rights set forth above, each of which entitles the owner thereof,
subject to the terms, provisions and conditions of the Rights
Agreement dated as of March 28, 1995 (the "Rights Agreement")
between Proffitt's, Inc., a Tennessee corporation (the
"Company"), and Union Planters National 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. Eastern Standard Time on March
28, 2005 at the office of the Rights Agent designated in the
Rights Agreement for such purpose, or its successor as Rights
Agent, one one-hundredth (1/100) of a fully paid nonassessable
share of Series C Junior Preferred Stock (the "Preferred Stock")
of the Company at a purchase price of $85, as the same may from
time to time be adjusted in accordance with the Rights Agreement
(the "Exercise Price"), upon presentation and surrender of this
Rights Certificate with the Form of Election to Purchase attached
hereto duly executed.
As provided in the Rights Agreement, the Exercise Price
and the number of shares of Preferred Stock which may be
purchased upon the exercise of the Rights evidenced by this
Rights Certificate are subject to modification and adjustment
upon the happening of certain events and, upon the happening of
certain events, securities other than shares of Preferred Stock,
or other property, may be acquired upon exercise of the Rights
evidenced by this Rights Certificate, as provided in the Rights
Agreement.
This Rights Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are incorporated herein by reference
and made a part hereof and to which Rights Agreement reference is
hereby made for a full description of the rights, limitations of
rights, obligations, duties and immunities of the Rights Agent,
the Company and the holders of record of Rights Certificates.
Copies of the Rights Agreement are on file at the principal
executive office of the Company.
This Rights Certificate, with or without other Rights
Certificates, upon surrender at the office of the Rights Agent
designated in the Rights Agreement for such purpose, may be
exchanged for another Rights Certificate or Rights Certificates
of like tenor and date evidencing Rights entitling the holder of
record 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 in part,
the holder shall be entitled to receive upon surrender hereof,
another Rights Certificate or Rights Certificates for the number
of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate (i) may be redeemed by the
Company at a redemption price of $.01 per Right, subject to
adjustment or (ii) may be exchanged in whole or in part for
shares of the Company's Common Stock, $.10 per share, shares of
Preferred Stock or substantially equivalent rights or other
consideration as determined by the Company.
No fractional shares of Preferred Stock (other than
fractions which are integral multiples of one one-hundredth
(1/100) of a share) are required to be issued upon the exercise
of any Right or Rights evidenced hereby, and in lieu thereof the
Company may cause depositary receipts to be issued and/or a cash
payment may be made, as provided in the Rights Agreement.
No holder of this Rights Certificate, as such, shall be
entitled to vote or receive dividends or be deemed for any
purpose the holder of Preferred Stock or of any other securities
of the Company which may at any time be issuable on the exercise
hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such,
any of the rights of a stockholder of the Company or any right to
vote for the election of directors or upon any matter submitted
to stockholders at meeting thereof, or to give or withhold
consent to any corporate action or to receive notice of meetings
or other actions affecting stockholders (except as provided in
the Rights Agreement), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced by this
Rights Certificate shall have been exercised as provided in the
Rights Agreement.
This Rights Certificate shall not be valid or
obligatory for any purpose until it shall have been countersigned
by the Rights Agent.
WITNESS the facsimile signature of the proper officers
of the Company. Dated as of __________.
ATTEST: PROFFITT'S, INC.
By:_________________________
Title:___________________
________________________
Secretary
Countersigned:
UNION PLANTERS NATIONAL BANK
By:_____________________
Authorized Signature
<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 Certificates.)
FOR VALUE RECEIVED ________________________________________
hereby sells, assigns and transfers unto ____________________
_____________________________________________________________
(Please print name and address of transferee)
_____________________________________________________________
Rights evidenced by this Rights Certificate, together with all
right, title and interest therein, and does hereby irrevocably
constitute and appoint __________________________ Attorney to
transfer the within Rights Certificate on the books of the
within-named Company, with full power of substitution.
Dated: ___________________
_______________________________
Signature
(Signature must conform in all
respects to name of holder as
specified on the face of this
Rights Certificate)
Signature Guaranteed:
(THE SIGNATURE SHOULD BE
GUARANTEED BY AN ELIGIBLE
GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND
LOAN ASSOCIATIONS AND CREDIT
UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE
MEDALLION PROGRAM), PURSUANT
TO S.E.C. RULE 17AD-15.
<PAGE>
Certificate
The undersigned hereby certifies by checking the
appropriate boxes that:
(1) this Rights Certificate [ ] is [ ] is not
being sold, assigned or transferred by or on behalf of a Person
who is or was an Acquiring Person or an Associate or an Affiliate
thereof (as such terms are defined in the Rights Agreement); and
(2) after due inquiry and to the best knowledge of the
undersigned, it [ ] did [ ] did not acquire the Rights
evidenced by this Rights Certificate from any Person who is, was
or subsequently became an Acquiring Person or an Affiliate or
Associate thereof (as such terms are defined in the Rights
Agreement).
Dated:_______________________ ____________________________
Signature
(Signature must conform in all
respects to name of holder as
specified on the face of this
Rights Certificate)
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed if registered holder
desires to exercise the Rights Certificate.)
TO: PROFFITT'S, INC.
The undersigned hereby irrevocably elects to exercise
Rights represented by this Rights Certificate to
purchase the shares of Preferred Stock (or other securities)
issuable upon the exercise of such Rights and requests that
certificates for such share(s) be issued in the following name:
Please insert social security
tax identification number:
(Please print name and address)
If such number of Rights shall not be all the Rights evidenced by
this Rights Certificate, a new Rights Certificate for the balance
remaining of such Rights shall be registered in the name of and
delivered to:
Please insert social security
or other identifying number:
(Please print name and address)
<PAGE>
Dated:______________________
_______________________________
Signature
(Signature must conform in all
respects to name of holder as
specified on the face of this
Rights Certificate)
Signature Guaranteed:
(THE SIGNATURE SHOULD BE
GUARANTEED BY AN ELIGIBLE
GUARANTOR INSTITUTION (BANKS,
STOCKBROKERS, SAVINGS AND
LOAN ASSOCIATIONS AND CREDIT
UNIONS WITH MEMBERSHIP IN
AN APPROVED SIGNATURE GUARANTEE
MEDALLION PROGRAM), PURSUANT
TO S.E.C. RULE 17AD-15.
EXHIBIT 2
April __, 1995
To Our Stockholders:
Your Board of Directors has adopted a Preferred
Share Purchase Rights Plan under which Proffitt's, Inc.
("Proffitt's") will issue Rights with its Common Stock.
The terms of the plan are set forth in a Rights
Agreement. A summary of the Rights Agreement, which you
may wish to attach to your share certificate, is attached
to this letter.
The Rights to be issued under the Plan contain
provisions to protect stockholders in the event of an
unsolicited and potentially disruptive attempt to acquire
Proffitt's, including a gradual accumulation of shares in
the open market, a partial or two-tier tender offer that
does not treat all stockholders equally, and other
abusive takeover tactics. Our managers view their role to
be stewards for our shareholders, and they share a large
equity stake in the corporation. Our Board considers the
Rights to be a reasonable means of protecting both your
right to retain your equity investment in Proffitt's and
the full value of that investment, while not foreclosing
a fair acquisition bid for Proffitt's.
The Rights will trade automatically with shares of
Proffitt's Common Stock and are not exercisable except as
provided in the Rights Agreement. However, as more fully
described in the Summary attached to this letter, ten
days after the announcement that a person or group has
acquired 20% or more of Proffitt's shares, or ten
business days after the announcement that a person or
group has commenced a tender offer the consummation of
which would result in such person or group owning 20% or
more of the shares (even if no purchases actually occur),
the Rights will become exercisable, and separate
certificates representing the Rights will be distributed.
The Rights would begin to trade independently from
Proffitt's shares at that time. At no time will the
Rights have any voting power.
In adopting the Plan, we have expressed our
continued confidence in the future and our determination
that you, our stockholders, be given every opportunity to
participate fully in that future. We remain deeply
committed to the first tenet of our Mission Statement,
namely, that our Company will create value for its
shareholders through the exceptional operation of our
retail enterprises.
On behalf of the Board of Directors,
PROFFITT'S, INC.
By:
R. Brad Martin,
Chairman of the
Board
