<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant
to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) August 13, 1997
ABIOMED, INC.
(Exact Name Of Registrant As Specified In Its Charter)
DELAWARE
(State or Other Jurisdiction of Incorporation)
0-20584 04-2743260
(Commission File Number) (I.R.S. Employer Identification No.)
33 Cherry Hill Drive, Danvers, Massachusetts 01923
(Address of Principal Executive Offices) (Zip Code)
(508)777-5410
(Registrant's Telephone Number, Including Area Code)
N/A
(Former Name or Former Address, if Changed Since Last Report)
<PAGE>
Item 5. Other Events.
On August 13, 1997, the Board of Directors of ABIOMED, Inc.
(the "Company") declared a dividend of one preferred share
purchase right (a "Right") for each outstanding share of common
stock, par value $0.01 per share (the "Common Shares") on August
28, 1997 (the "Record Date") to the stockholders of record on that
date. Each Right entitles the registered holder to purchase from the
Company one one-thousandth of a share of Series A Junior
Participating Preferred Stock, par value $0.01 per share (the
"Preferred Shares"), of the Company, at a price of $90.00 per one
one-thousandth of a Preferred Share (the "Purchase Price"), subject
to adjustment. The description and terms of the Rights are set forth
in a Rights Agreement (the "Rights Agreement") between the
Company and BankBoston, N.A., as Rights Agent (the "Rights
Agent").
Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated
persons (an "Acquiring Person") has acquired beneficial ownership
of 15% or more of the outstanding Common Shares, or (ii) 10
business days (or such later date as may be determined by action of
the Board of Directors prior to such time as any Person 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 15% 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 certificate with a copy of the Summary of
Rights attached thereto.
The 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 or upon transfer or new issuance of Common Shares will
contain a notation incorporating the Agreement by reference. Until
the Distribution Date (or earlier redemption or expiration of the
Rights), the surrender for 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
<PAGE>
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 August 13, 2007 (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 number of outstanding Rights and the number of one one-
thousandths 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, consolidations or
combinations of the Common Shares occurring, in any such 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 quarterly
dividend payment of 1000 times the dividend declared per Common
Share. In the event of liquidation, the holders of the Preferred
Shares will be entitled to an aggregate payment of 1000
<PAGE>
times the aggregate payment made per Common Share. Each
Preferred Share will have 1000 votes, voting together with the
Common Shares. In the event of any merger, consolidation or other
transaction in which Common Shares are exchanged, each Preferred
Share will be entitled to receive 1000 times the amount received per
Common Share. These rights are protected by customary
antidilution provisions.
Because of the nature of the Preferred Shares' dividend,
liquidation and voting rights, the value of the one one-thousandth
interest in a Preferred Share purchasable upon exercise of each
Right 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 and its
Affiliates and Associates (which will thereafter be void), will
thereafter 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. In the event that, at any time after a Person
becomes an Acquiring Person, the Company is acquired in a merger
or other business combination transaction or 50% or more of its
consolidated assets or earning power are sold, proper provision will
be made so that each holder of a Right 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.
If the Company does not have sufficient Common Shares to satisfy
such obligation to issue Common Shares, or if the Board of
Directors so elects, the Company shall deliver upon payment of the
exercise price of a Right an amount of cash or securities equivalent
in value to the Common Shares issuable upon exercise of a Right;
provided that, if the Company fails to meet such obligation within
30 days following the later of (x) the first occurrence of an event
triggering the right to purchase Common Shares and (y) the date on
which the Company's right to redeem the Rights expires, the
Company must deliver, upon exercise of a Right but without
requiring payment of the exercise price then in effect, Common
Shares (to the extent available) and cash equal in value to the
difference between the value of the Common Shares otherwise
<PAGE>
issuable upon the exercise of a Right and the exercise price then in
effect. The Board of Directors may extend the 30-day period
described above for up to an additional 60 days to permit the taking
of action that may be necessary to authorize sufficient additional
Common Shares to permit the issuance of Common Shares upon the
exercise in full of the Rights.
At any time after any Person becomes an Acquiring Person and
prior to the acquisition by any person or group of a majority 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 per Right (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 one one-thousandth of a Preferred Share, which may, at
the election of the Company, be evidenced by depository 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 time any Person becomes an Acquiring
Person, the Board of Directors of the Company may redeem the
Rights in whole, but not in part, at a price of $0.001 per Right (the
"Redemption Price"). The redemption of the Rights may be made
effective at such time, on such basis and with such conditions as the
Board of Directors in its sole discretion may establish.
Immediately upon any redemption of the Rights, the right to
exercise the Rights will terminate and the only right of the holders
of Rights will be to receive the Redemption Price.
The terms of the Rights may be amended by the Board of
Directors of the Company without the consent of the holders of the
Rights, except that from and after such time as any person becomes
an Acquiring Person no such amendment may adversely affect the
interests of the holders of the Rights (other than the Acquiring
Person and its Affiliates and Associates).
<PAGE>
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 Agreement is attached hereto as an exhibit and is
incorporated herein by reference. This summary description of the
Rights does not purport to be complete and is qualified in its
entirety by reference to the Agreement.
Item 7. Financial Statements and Exhibits.
Exhibit 4 Rights Agreement between the Registrant and
BankBoston, N.A., as Rights Agent, dated as of August
13, 1997.
Exhibit 99 ABIOMED, Inc. Press Release dated August 13, 1997.
<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.
Dated: August 13, 1997 ABIOMED, INC.
By: /s/ David M. Lederman
David M. Lederman
President and Chief Executive Officer
#50088727 v1 - DONEGAJM - tkpj01!.DOC - 8209/1
<PAGE>
ABIOMED, INC.
and
BANKBOSTON, N.A.
Rights Agent
Rights Agreement
Dated as of August 13, 1997.
<PAGE>
TABLE OF CONTENTS
Section 1. Certain Definitions
Section 2. Appointment of Rights Agent
Section 3. Issue of Right Certificates
Section 4. Form of Right Certificates
Section 5. Countersignature and
Registration
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates
Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights
16
Section 8. Cancellation and Destruction of Right Certificates
Section 9. Status and Availability of Preferred Shares
Section 10. Preferred Shares Record Date
Section 11. Adjustment of Purchase Price, Number of Shares
or Number of Rights
Section 12. Certificate of Adjustment
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning
Power 39 Section 14. Fractional Rights and Fractional Shares
Section 15. Rights of Action
Section 16. Agreement of Right Holders
Section 17. Right Certificate Holder Not Deemed a Stockholder
Section 18. Concerning the Rights Agent
Section 19. Merger or Consolidation or Change of Name of Rights Agent
Section 20. Duties of Rights Agent
Section 21. Change of Rights Agent
Section 22. Issuance of New Right
Certificates Section 23. Redemption
Section 24. Exchange
Section 25. Notice of Certain Events
Section 26. Notices
Section 27. Supplements and Amendments
Section 28. Successors
Section 29. Benefits of this Agreement
Section 30. Severability
Section 31. Governing Law
Section 32. Counterparts
Section 33. Descriptive Headings
Section 34. Administration
<PAGE>
RIGHTS AGREEMENT
Agreement, dated as of August 13, 1997, between ABIOMED, Inc., a
Delaware corporation (the "Company"), and BankBoston, N.A., a
national banking association (the "Rights Agent"). The Board of
Directors of the Company has authorized and declared a dividend of
one preferred share purchase right (a
"Right") for each share of Common Stock, par value $0.01 per
share, of the Company (a "Common Share") outstanding on the close
of business on August 28, 1997 (the "Record Date") and has
authorized the issuance of one Right with respect to each
additional Common Share that shall become outstanding between the
Record Date and the earlier of the Distribution Date, the
Expiration Date or the
Final Expiration Date (as such terms are defined in Sections 3 and
7
hereof), each Right representing the right to purchase one one
thousandth of a share (a "Preferred Share," as hereinafter defined)
of Series A Junior Participating Preferred Stock of the Company
having the rights and preferences set forth in the form of
Certificate of Designations attached hereto as Exhibit A, or such
different amount and/or kind of securities as shall be hereinafter
provided.
<PAGE>
Accordingly, 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 have the meanings indicated:
"Acquiring Person" shall mean any Person who or which,
together with all Affiliates and Associates of such Person, shall
be the Beneficial Owner of 15% or more of the Common Shares of the
Company then outstanding, but shall not include (i) the Company,
(ii) any Subsidiary of the Company, (iii) any employee benefit plan
of the Company or any Subsidiary of the Company, (iv) any entity
holding Common Shares for or pursuant to the terms of any such
employee benefit plan, or (v) David M. Lederman, any members of
his immediate family or any of his or their Affiliates or
Associates. Notwithstanding the foregoing, (1) no Person shall
become an "Acquiring Person" as the result of an acquisition of
Common
Shares by the Company which, by reducing the number of shares
outstanding, increases the proportionate number of shares
beneficially owned by such Person to 15% or more of the Common
Shares of the Company then outstanding; provided, however, that
if a Person shall so become the Beneficial Owner of 15% or more
of the Common Shares of the Company then outstanding by reason
of
<PAGE>
an acquisition of Common Shares by the Company and shall, after
such share purchases by the Company, become the Beneficial Owner
of an additional 1% of the outstanding Common Shares of the
Company, then such Person shall be deemed to be an "Acquiring
Person"; (2) if the Board of Directors of the Company determines
in good faith that a Person who would otherwise be an "Acquiring
Person," as defined pursuant to the foregoing provisions of this
paragraph, has become such inadvertently, and such Person
divests as promptly as practicable a sufficient number of Common
Shares so that such Person would no longer be an "Acquiring
Person," as defined pursuant to the foregoing provisions of this
paragraph, then such Person shall not be deemed to have become
an "Acquiring Person" for any purposes of this Agreement; and
(3) an underwriter or underwriters which become the Beneficial
Owner of 15% or more of the Common Shares of the Corporation
then outstanding in connection with an underwritten public
offering with a view to the public distribution of such Common
Shares shall not become an "Acquiring Person" hereunder.
"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 amende
<PAGE>
(the "Exchange Act"), as in effect on the date of this Agreement
A Person shall be deemed the "Beneficial Owner" of and shall
be deemed to "beneficially own" any securities:
(i) which such Person or any of such Person's Affiliates
or Associates beneficially owns, directly or indirectly;
(ii) which such Person or any of such Person's Affiliates or
Associates has (A) the right to acquire (whether such right is
exercisable immediately or only after the passage of time)
pursuant to any agreement, arrangement or understanding (other
than customary agreements with and between underwriters and
selling group members with respect to a bona fide public offering
of
securities), written or otherwise, or upon the exercise of
conversion rights, exchange rights, rights (other than the
Rights), warrants or options, or otherwise; provided, however,
that a Person shall not be deemed to be the Beneficial Owner of,
or to beneficially own, securities tendered pursuant to a tender
or exchange offer made pursuant to, and in accordance with, the
applicable rules and regulations promulgated under the Exchange
Act by or on behalf of such Person or any of such Person's
Affiliates or Associates until such tendered securities are
accepted for purchase or exchange; or
<PAGE>
(B) the right to vote pursuant to any agreement, arrangement or
understanding; provided, however, that a Person shall not be
deemed the Beneficial Owner of, or to beneficially own, any
security if the agreement, arrangement or understanding to vote
such security (1) arises solely from a revocable proxy or consent
given to such Person in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the
applicable rules and regulations promulgated under the Exchange
Act and (2) is not also then reportable on Schedule 13D under the
Exchange Act (or any comparable or successor report); or
(iii) which are beneficially owned, directly or indirectly,
by any other Person with which such Person or any of such
Person's Affiliates or Associates has any agreement, arrangement
or understanding (other than customary agreements with and
between underwriters and selling group members with respect to a
bona fide public offering of securities), written or otherwise,
for the purpose of acquiring, holding, voting (except to the
extent contemplated by the proviso to section (B) of the
immediately preceding paragraph (ii)) or disposing of any
securities of the Company.
Notwithstanding anything in this definition of Beneficial
Ownership to the contrary, the phrase "then outstanding," when
used
<PAGE>
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.
"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. "Close of Business" on any given date shall mean 5:00
P.M., Boston, Massachusetts time, on such date; provided,
however, that if such date is not a Business Day it shall mean
5:00 P.M., Boston, Massachusetts time, on the next succeeding
Business Day. "Common Shares" when used with reference to the
Company
shall mean the shares of common stock, par value $0.01 per share,
of the Company. "Common Shares" when used with reference to any
Person other than the Company shall mean the capital stock (or
equity interest) with the greatest voting power of such other
Person or, if such other Person is a Subsidiary of another
Person,
the Person or Persons which ultimately control such first-
mentioned Person.
<PAGE>
"Common Stock Equivalents" shall have the meaning set forth
in section 11(a)(iii)(B)(3).
"Current Value" shall have the meaning set forth in Section
11(a)(iii)(A)(1) hereof.
"Distribution Date" shall have the meaning set forth in Section
3 hereof.
"Equivalent preferred shares" shall have the meaning set forth
in Section 11(b).
"Exchange Ratio" shall have the meaning set forth in Section
24(a). "Final Expiration Date" shall mean August 13, 2007.
"Person" shall mean any individual, firm, corporation,
partnership, limited partnership, limited liability partnership,
business trust, limited liability company, unincorporated
association or other entity, and shall include any successor (by
merger or otherwise) of such entity.
"Purchase Price" shall have the meaning set forth in Section
7(b).
"Preferred Shares" shall mean shares of Series A Junior
Participating Preferred Stock, par value $0.01 per share, of the
Company.
<PAGE>
"Redemption Date" shall mean the date on which the Rights are
redeemed as provided in Section 23 hereof.
"Right Certificate" shall mean a certificate evidencing a Right
in substantially the form of Exhibit B hereto.
"Section 11(a)(ii) Trigger Date" shall have the meaning set
forth in Section 11(a)(iii) hereof.
"Shares Acquisition Date" shall mean the earlier of the date of
(i) the public announcement by the Company or an Acquiring Person
that an Acquiring Person has become such or (ii) the public
disclosure of facts by the Company or an Acquiring Person
indicating that an Acquiring Person has become such.
"Spread" shall have the meaning set forth in Section
11(a)(iii)(A)(2) hereof.
"Subsidiary" of any Person shall mean any Person of which a
majority of the voting power of the voting equity securities or
equity interest is owned, directly or indirectly, by such
Person. "Substitution Period" shall have the meaning set forth
in Section 11(a)(iii) hereof.
"Summary of Rights" shall mean the Summary of Rights to Purchase
Preferred Shares in substantially the form of Exhibit C hereto.
<PAGE>
Section 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company and
the holders of the Rights (who, in accordance with Section 3
hereof, shall prior to the Distribution Date also be the holders
of the Common Shares) 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. Issue of Right Certificates.
(a) Until the earlier of (i) the tenth day after the Shares
Acquisition Date or (ii) the tenth Business Day (or such later
date as may be determined by action of the Board of Directors
prior to such time as any Person becomes an Acquiring Person)
after the date of the commencement by any Person (other than the
Company, any Subsidiary of the Company, any employee benefit
plan of the Company or of any Subsidiary of the Company or any
entity holding Common Shares for or pursuant to the terms of any
such plan) of, or of the first public announcement of the
intention of any Person (other than any of the Persons referred
to in the
preceding parenthetical) to commence, a tender or exchange offer
th
<PAGE>
consummation of which would result in any Person becoming the
Beneficial Owner of Common Shares aggregating 15% or more of the
then outstanding Common Shares (such date being herein referred
to as the "Distribution Date"), (x) the Rights will be evidenced
(subject to the provisions of Section 3(b) hereof) by the
certificates for Common Shares registered in the names of the
holders thereof (which certificates shall also be deemed to be
Right Certificates) and not by separate Right Certificates, and
(y) the right to receive Right Certificates will be transferable
only in connection with the transfer of Common Shares. 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, insured, postage-
prepaid mail, to each record holder of Common Shares as of the
Close of Business on the Distribution Date, at the address of
such holder shown on the records of the Company, a
Right Certificate evidencing one Right for each Common Share so
held. As of the Distribution Date, the Rights will be evidenced
solely by such Right Certificates. For purposes hereof, a
tender or exchange offer shall not be deemed to have commenced,
nor shall any Person be deemed to have publicly announced an
intent to commence a tender or exchange offer, until such time
as (i) one o
<PAGE>
more of the events specified by Rule 14d-2(a)(1), (2), (3) or
(4) under the Exchange Act shall have occurred or any Person
shall have filed a Schedule 14D-1 with the Securities and
Exchange Commission under the Exchange Act with respect to the
commencement of a tender or exchange offer (the first to occur
of any such events or filing being deemed an "Event") or (ii) an
Event shall have occurred following a public announcement by any
Person (other than the Company, any Subsidiary of the Company,
any employee benefit plan of the Company or of any Subsidiary of
the Company or any entity holding Common Shares for or pursuant
to the terms of any such plan) of the intention to commence a
tender or exchange offer.
(b) On the Record Date, or as soon as practicable
thereafter, the Company will send a copy of the Summary of
Rights by first-class, postage-prepaid mail, to each record
holder of Common Shares as of the Close of Business on the
Record Date, at the address of such holder shown on the records
of the Company. With respect to certificates for Common Shares
outstanding as of the Record Date, until the Distribution Date,
the Rights will be evidenced by such certificates registered in
the names of the holder
<PAGE>
thereof together with a copy of the Summary of Rights attached
thereto. Until the Distribution Date (or the earlier of the
Redemption Date or the Final Expiration Date), the surrender for
transfer of any certificate for Common Shares outstanding on the
Record Date, with or without a copy of the Summary of Rights
attached thereto, shall also constitute the transfer of the
Rights associated with the Common Shares evidenced thereby.
(c) Certificates for Common Shares which become outstanding
(including, without limitation, reacquired Common
Shares referred to in the last sentence of this paragraph (c))
after the Record Date but prior to the earliest of the
Distribution Date, the Redemption Date or the Final Expiration
Date shall have impressed on, printed on, written on or otherwise
affixed to them the following legend:
This certificate also evidences and entitles the
holder hereof to certain Rights as set forth in a
Rights Agreement between ABIOMED, Inc. and
BankBoston, N.A., as Rights Agent, dated as of
August 13, 1997 (the "Rights Agreement"), the
terms of which are hereby incorporated herein by
reference and a copy of which is on file at the
principal executive offices of ABIOMED, Inc.
Under certain circumstances, as set forth in the
Rights Agreement, such Rights will be evidenced
by separate certificates and will no longer be
evidenced by this certificate. ABIOMED, Inc.
will mail to the holder of this certificate a
copy of the Rights Agreement without charge after
receipt of a written request
<PAGE>
therefor. Under certain
circumstances, Rights that are or were
acquired or beneficially owned by
Acquiring Persons (as defined in the
Rights Agreement) may become null and
void.
With respect to such certificates containing the foregoing legend,
until the Distribution Date, the Rights associated with the Common
Shares represented by certificates shall be evidenced by such
certificates alone, and the surrender for transfer of any such
certificate shall also constitute the transfer of the Rights
associated with the Common Shares represented thereby. In the
event that the Company purchases or acquires any Common Shares
after the Record
Date but prior to the Distribution Date, any Rights associated with
such Common Shares shall be deemed canceled and retired so that the
Company shall not be entitled to exercise any Rights associated
with the Common Shares which are no longer outstanding.
Section 4. Form of Right Certificates. The Right Certificates
(and the forms of election to purchase Preferred Shares and of
assignment to be printed on the reverse thereof) shall be
substantially the same as Exhibit B hereto and may have such marks
of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate
and as are not inconsistent with the provisions of this Agreement,
or as may be required to comply with any applicable law or with an
<PAGE>
rule or regulation made pursuant thereto or with any rule or
regulation of any stock exchange on which the Rights may from time
to time be listed, or to conform to usage. Subject to the other
provisions of this Agreement, the Right Certificates shall entitle
the holders thereof to purchase such number of one one-thousandths
of a Preferred Share as shall be set forth therein at the Purchase
Price, but the number of one one-thousandths of a Preferred Share
and the Purchase Price shall be subject to adjustment as provided
herein. Section 5. Countersignature and Registration. The
Right Certificates shall be executed on behalf of the Company by
its Chairman of the Board, its Chief Executive Officer, its
President, any of its Vice Presidents, or its Treasurer, either
manually or by facsimile signature, shall have affixed thereto the
Company's seal or a facsimile thereof, and shall be attested by the
Secretary or any Assistant Secretary of the Company, either
manually or by facsimile signature. The Right Certificates shall
be countersigned by the Rights Agent and shall not be valid for any
purpose unless so
countersigned, either manually or by facsimile. In case any
officer of the Company who shall have signed any of the Right
Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by
the Company, such Right Certificates, nevertheless, may b
<PAGE>
countersigned by the Rights Agent and issued and delivered by the
Company with the same force and effect as though the person who
signed such Right Certificates had not ceased to be such officer of
the Company; and any Right Certificate may be signed on behalf of
the Company by any person who, at the actual date of the execution
of such Right Certificate, shall be a proper officer of the Company
to sign such Right Certificate, although at the date of the
execution of this Rights Agreement any such person was not such an
officer. Following the Distribution Date, the Rights Agent will
keep or
cause to be kept, at its principal office, books for registration
of the transfer of the Right Certificates issued hereunder. Such
books shall show the names and addresses of the respective holders
of the Right Certificates, the number of Rights evidenced on its
face by each of the Right Certificates and the date of each of the
Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of
Right Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates. Subject to the provisions of Section 14 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 Right Certificate
or Righ
<PAGE>
Certificates (other than Right Certificates representing Rights
that have become void pursuant to Section 11(a)(ii) hereof or that
have been exchanged pursuant to Section 24 hereof) may be
transferred, split up, combined or exchanged for another Right
Certificate or
Right Certificates, entitling the registered holder to purchase a
like number of one one-thousandths of a Preferred Share as the
Right Certificate or Right Certificates surrendered then entitled
such holder to purchase. Any registered holder desiring to
transfer, split up, combine or exchange any Right Certificate or
Right Certificates shall make such request in writing delivered to
the Rights Agent,
and shall surrender the Right Certificate or Right Certificates to
be transferred, split up, combined or exchanged at the principal
office of the Rights Agent. Thereupon the Rights Agent shall
countersign and deliver to the person entitled thereto a Right
Certificate or Right Certificates, as the case may be, as so
requested. The Company may require payment of a sum sufficient for
any tax or governmental charge that may be imposed in connection
with any transfer, split up, combination or exchange of Right
Certificates. Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft,
destruction or mutilation of a Right Certificate, and, in case of
loss, theft o
<PAGE>
destruction, of indemnity or security reasonably satisfactory to
them, and, at the Company's request, reimbursement to the Company
and the Rights Agent of all reasonable expenses incidental thereto,
and upon surrender to the Rights Agent and cancellation of the
Right Certificate if mutilated, the Company will make and deliver a
new Right Certificate of like tenor to the Rights Agent for delivery
to the registered holder in lieu of the Right Certificate so lost,
stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date
of Rights.
(a) The registered holder of any Right Certificate (other than a
holder whose Rights have become void pursuant to Section
11(a)(ii) hereof or have been exchanged pursuant to Section 24
hereof) may exercise the Rights evidenced thereby in whole or in
part at any time after the Distribution Date upon surrender of the
Right Certificate, with the form of election to purchase on the
reverse side thereof duly executed, to the Rights Agent at its
principal office, together with payment of the Purchase Price for
each one onethousandth of a Preferred Share as to which the Rights
are exercised, at or prior to the earliest of (i) the Close of
Business
on the Final Expiration Date, (ii) the Redemption Date, or (iii)
th
<PAGE>
time at which such Rights are exchanged as provided in Section 24
hereof.
(b) The purchase price for each one one-thousandth of a
Preferred Share to be purchased upon the exercise of a Right shall
initially be Ninety Dollars ($90.00) (the "Purchase Price"), shall
be subject to adjustment from time to time as provided in Sections
11 and 13 hereof and shall be payable in lawful money of the
United States of America in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase and
certificate duly executed, accompanied by payment of the Purchase
Price for the number of one one-thousandths of a Preferred Share
to be purchased and an amount equal to any applicable transfer tax
required to be paid by the holder of such Right Certificate in
accordance with Section 9 hereof by cash, certified check,
cashier's check or money order payable to the order of the
Company, the Rights Agent shall thereupon promptly (i) (A)
requisition from any
transfer agent of the Preferred Shares certificates for the number
of one one-thousandths of a Preferred Share to be purchased and
the Company hereby irrevocably authorizes its transfer agent to
comply with all such requests, or (B) requisition from any
depositary agen
<PAGE>
for the Preferred Shares depositary receipts representing such
number of one one-thousandths of a Preferred Share as are to be
purchased (in which case certificates for the Preferred Shares
represented by such receipts shall be deposited by the transfer
agent with the depositary agent) and the Company hereby directs
the depositary agent to comply with such request, (ii) when
appropriate, requisition from the Company the amount of cash to be
paid in lieu of issuance of fractional Preferred Shares in
accordance with Section 14 hereof, (iii) after receipt of such
certificates or depositary receipts, cause the same to be
delivered to or upon the order of the registered holder of such
Right Certificate, registered in such name or names as may be
designated by such holder and (iv) when appropriate, after
receipt, deliver such cash to or upon the order of the registered
holder of such Right Certificate.
(d) In case the registered holder of any Right
Certificate shall exercise less than all the Rights evidenced
thereby, a new Right Certificate evidencing Rights equivalent to
the Rights remaining unexercised shall be issued by the Rights
Agent to the registered holder of such Right Certificate or to his
duly authorized assigns, subject to the provisions of Section 14
hereof.
<PAGE>
(e) 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 Right Certificate
surrendered for such exercise and (ii) provided such additional
evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the
Company shall reasonably request.
Section 8. Cancellation and Destruction of Right Certificates.
All Right Certificates surrendered for the purpose of exercise,
transfer, split up, combination or exchange shall, if surrendered
to the Company or to any of its agents, be delivered to the Rights
Agent for cancellation or in canceled form, or, if surrendered to
the Rights Agent, shall be canceled by it, and no Right
Certificates shall be issued in lieu thereof except as expressly
permitted by any of the provisions of this Rights Agreement. The
Company shall deliver to the Rights Agent for cancellation and
retirement, and the Rights Agent shall so cancel and retire, any
other Right Certificate purchased or acquired by the Company
otherwise than upon th
<PAGE>
exercise thereof. The Rights Agent shall deliver all canceled
Right Certificates to the Company, or shall, at the written request
of the Company, destroy such canceled Right Certificates, and in
such case shall deliver a certificate of destruction thereof to the
Company. Section 9. Status and Availability of Preferred
Shares.
(a) The Company covenants and agrees that it will take
all such action as may be necessary to ensure that all Preferred
Shares delivered upon exercise of Rights shall, at the time of
delivery of the certificates for such Preferred Shares (subject to
payment of the Purchase Price), be duly and validly authorized and
issued and fully paid and non-assessable shares.
(b) The Company further covenants and agrees that it
will pay when due and payable any and all federal and state
transfer taxes and charges which may be payable in respect of the
issuance
or delivery of the Right Certificates or of any Preferred Shares
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 Right Certificates to a person other
than, or the issuance or delivery of certificates or depositary
receipts for the Preferred Shares in a name other than that of, the
registered holder of the Right Certificate evidencing Rights
surrendered fo
<PAGE>
exercise or to issue or to deliver any certificates or depositary
receipts for Preferred Shares upon the exercise of any Rights until
any such tax shall have been paid (any such tax being payable by
the holder of such Right Certificate at the time of surrender) or
until it has been established to the Company's reasonable
satisfaction that no such tax is due.
(c) The Company covenants and agrees that it will cause
to be reserved and kept available, out of its authorized and
unissued Preferred Shares or any Preferred Shares held in its
treasury, the number of Preferred Shares that will be sufficient
to permit the exercise in full of all outstanding Rights in
accordance with Section 7 hereof.
Section 10. Preferred Shares Record Date. Each person in
whose name any certificate for Preferred Shares is issued upon
the
exercise of Rights shall for all purposes be deemed to have become
the holder of record of the Preferred Shares represented thereby
on, and such certificate shall be dated, the date upon which the
Right Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and any applicable transfer taxes)
was made. Prior to the exercise of the Rights evidenced thereby,
the holder of a Right Certificate shall not be entitled to any
rights of a holder of Preferred Shares for which the Rights shall
be
<PAGE>
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 Purchase Price, Number of Shares or
Number of Rights. The Purchase Price, the number of
Preferred Shares covered by each Right and the number of Rights
outstanding are subject to adjustment from time to time as
provided in this Section 11.
(a)(i) In the event the Company shall at any time
after the date of this Agreement (A) declare a dividend on the
Preferred Shares payable in Preferred Shares, (B) subdivide the
outstanding Preferred Shares, (C) combine the outstanding
Preferred Shares into a smaller number of Preferred Shares or (D)
issue any shares of its capital stock in a reclassification of the
Preferred Shares (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 Purchase Price in effect at
the time of the record date for such dividend or of the effective
date of such subdivision,
<PAGE>
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, 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. (ii) Subject to the following paragraph of this
subparagraph (ii) and to Section 24 of this Agreement, in the
event any Person shall become an Acquiring Person, each holder of
a
Right shall thereafter have a right to receive, upon exercise
thereof at a price equal to the then current Purchase Price
multiplied by the number of one one-thousandths of a Preferred
Share for which a Right is then exercisable, in accordance with
the terms of this Agreement and in lieu of Preferred Shares, such
number of Common Shares of the Company as shall equal the result
obtained by (x)
<PAGE>
multiplying the then current Purchase Price by the number of one
one-thousandths of a Preferred Share for which a Right is then
exercisable and dividing that product by (y) 50% of the then
current per share market price of the Company's Common Shares
(determined pursuant to Section 11(d) hereof) on the date such
Person became an Acquiring Person. In the event that any Person
shall become an Acquiring Person and the Rights shall then be
outstanding, the Company shall not take any action that would
eliminate or diminish the benefits intended to be afforded by the
Rights.
From and after the occurrence of such an event, any Rights
that are or were acquired or beneficially owned by such Acquiring
Person (or any Associate or Affiliate of such Acquiring Person) on
or after the earlier of (x) the Shares Acquisition Date and (y)
the Distribution Date shall be void and any holder of such Rights
shall thereafter have no right to exercise such Rights under any
provision of this Agreement. No Right Certificate shall be issued
pursuant to Section 3 that represents Rights beneficially owned by
an Acquiring Person whose Rights would be void pursuant to the
preceding sentence or any Associate or Affiliate thereof; no Right
Certificate shall be issued at any time upon the transfer of any
Rights to a
<PAGE>
Acquiring Person whose Rights would be void pursuant to the
preceding sentence or any Associate or Affiliate thereof or to any
nominee of such Acquiring Person, Associate or Affiliate; and any
Right Certificate delivered to the Rights Agent for transfer to an
Acquiring Person whose Rights would be void pursuant to the
preceding sentence or any Associate or Affiliate thereof shall be
canceled.
(iii) In the event that the number of Common Shares
which are authorized by the Company's certificate of incorporation
and not outstanding or subscribed for, or reserved or otherwise
committed for issuance for purposes other than upon exercise of
the Rights, are not sufficient to permit the holder of each Right
to purchase the number of Common Shares to which he would be
entitled upon the exercise in full of the Rights in accordance
with the foregoing subparagraph (ii) of paragraph (a) of this
Section 11, or should the Board of Directors so elect, the Company
shall: (A) determine the excess of (1) the value of the Common
Shares issuable upon the exercise of a Right (calculated as
provided in the last sentence of this subparagraph (iii)) pursuant
to Section 11(a)(ii) hereof (the "Current Value") over (2) the
Purchase Price (such excess, the "Spread"), and (B) with respect
to each Right, make adequate provision to substitute for such
Common Shares, upon payment of the applicable Purchase Price, any
one or more of the following having an aggregate value determined
by the Board of Directors to be equal to the Current Value: (1)
cash, (2) a reduction in the Purchase Price, (3) Common Shares or
other equity securities of the Company (including, without
limitation, shares, or units of shares, of preferred stock which
the Board of Directors of the Company has determined to have the
same value as Common Shares (such shares of preferred stock,
"common stock equivalents")), (4) debt securities of the Company,
or (5) other assets; 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 first occurrence
of an event triggering the rights to purchase Common Shares
described in Section 11(a)(ii) the "Section 11(a)(ii) Trigger
Date"), then the Company shall be obligated to deliver, upon the
surrender for exercise of a Right and without requiring payment of
the Purchase Price, Common Shares (to the extent available) and
then, if necessary, cash, which shares and cash have an aggregate
value equal to the Spread. If the Board of Directors of the
Company shall determine in good faith that it is likely that
sufficient additional Common Shares could be authorized for
issuance upon exercise in full of the Rights, the thirty (30) da
<PAGE>
period set forth above may be extended to the extent necessary,
but not more than ninety (90) days after the Section 11(a)(ii)
Trigger Date, in order that the Company may seek stockholder
approval for the authorization of such additional shares (such
period, as it may be extended, the "Substitution Period"). To the
extent that the Company determines that some action need be taken
pursuant to the first and/or second sentences of this Section
11(a)(iii), the Company (x) shall provide, subject to Section 7(e)
hereof and the last paragraph of Section 11(a)(ii) hereof, that
such action shall apply uniformly to all outstanding Rights, and
(y) may suspend the exercisability of the Rights until the
expiration of the Substitution Period in order to seek any
authorization of additional shares and/or to decide the
appropriate form of distribution to be made pursuant to such first
sentence and to determine the value thereof. In the event of any
such suspension, the Company shall make a public announcement, and
shall deliver to the Rights Agent a statement, stating that the
exercisability of the Rights has been temporarily suspended. At
such time as the suspension is no longer in effect,
the Company shall make another public announcement, and deliver to
the Rights Agent a statement, so stating. For purposes of this
Section 11(a)(iii), the value of the Common Shares shall be th
<PAGE>
current per share market price (as determined pursuant to Section
11(d)(i) hereof) of the Common Shares on the Section 11(a)(ii)
Trigger Date and the value of any common stock equivalent shall be
deemed to have the same value as the Common Shares on such date.
(b) In case the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of
Preferred Shares entitling them (for a period expiring within 45
calendar days after such record date) to subscribe for or purchase
Preferred Shares (or shares having the same rights, privileges and
preferences as the Preferred Shares ("equivalent preferred
shares")) or securities convertible into Preferred Shares or
equivalent preferred shares at a price per Preferred Share or
equivalent preferred share (or having a conversion price per
share, if a security convertible into Preferred Shares or
equivalent preferred shares) less than the then current per share
market price of the Preferred Shares (as defined in Section 11(d))
on such record date, the Purchase Price to be in effect after such
record date shall be adjusted by multiplying the Purchase Price in
effect immediately prior to such record date by a fraction, the
numerator of which shall be the number of Preferred Shares
outstanding on such record date plus the number of Preferred Share
<PAGE>
which the aggregate offering price of the total number of
Preferred Shares and/or equivalent preferred shares so to be
offered (and/or the aggregate initial conversion price of the
convertible securities so to be offered) would purchase at such
current market price and the denominator of which shall be the
number of Preferred Shares outstanding on such record date plus
the number of additional Preferred Shares and/or equivalent
preferred shares 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. In case such
subscription price may be paid in a consideration part or all of
which shall be in a form other than
cash, the value of such consideration shall be as determined in good
faith by the Board of Directors of the Company, whose determination
shall be described
in a statement filed with the Rights Agent. Preferred Shares owned
by or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date
is fixed; and in the event that such rights, options or warrants are
not so issued, the Purchase Price shall be adjusted to be th
<PAGE>
Purchase 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 Shares
(including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing or
surviving corporation) of evidences of indebtedness or assets (other
than a regular quarterly cash dividend or a dividend payable in
Preferred Shares) or subscription rights or warrants (excluding
those referred to in Section 11(b) hereof), the Purchase Price to be
in effect after such record date shall be determined by multiplying
the Purchase Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the then current per
share market price of the Preferred Shares on such record date, less
the fair market value (as determined in good faith by the Board of
Directors of the Company, whose determination shall be described in
a statement filed with the Rights Agent) of the portion of the
assets or evidences of indebtedness so to be distributed or of such
subscription rights or warrants applicable to one Preferred Share
and the denominator of which shall be such current per share marke
<PAGE>
price of the Preferred Shares; provided, however, that in no event
shall the consideration to be paid upon the exercise of one Right be
less than the aggregate par value of the shares of capital stock of
the Company to be issued upon exercise of one Right. Such
adjustments shall be made successively whenever such a record date
is fixed; and in the event that such distribution is not so made,
the Purchase Price shall again be adjusted to be the Purchase Price
which would then be in effect if such record date had not been
fixed. (d)(i) For the purpose of any computation hereunder,
the "current per share market price" of any security (a "Security"
for the purpose of this Section 11(d)(i)) on any date shall be
deemed to be the average of the daily closing prices per share of
such Security for the 30 consecutive Trading Days (as such term is
hereinafter defined) immediately prior to such date; provided,
however, that in the event that the current per share market price
of the Security is determined during a period following the
announcement by the issuer of such Security of (A) a dividend or
distribution on such Security payable in shares of such Security or
securities convertible into such shares, or (B) any subdivision,
combination or reclassification of such Security and prior to the
expiration of 30 Trading Days after the ex-dividend date for suc
<PAGE>
dividend or distribution, or the record date for such subdivision,
combination or reclassification, then, and in each such case, the
current per share market price shall be appropriately adjusted to
reflect the current market price per share equivalent of such
Security. The closing price for each day shall be the last sale
price, regular way, or, in case no such sale takes place on such
day, the average of the closing bid and asked prices, regular way,
in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock Exchange or, if the
Security is not listed or
admitted to trading on the New York Stock Exchange, as reported in
the principal consolidated transaction reporting system with
respect to securities listed on the principal national securities
exchange on which the Security is listed or admitted to trading or,
if the Security is not listed or admitted to trading on any
national securities exchange, the last quoted price or, if not so
quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by the National Association of
Securities Dealers, Inc. Automated Quotations System ("NASDAQ") or
such
other system then in use, or, if on any such date the Security is
not quoted by any such organization, the average of the closing
bid an
<PAGE>
asked prices as furnished by a professional market maker making a
market in the Security selected by the Board of Directors of the
Company. The term "Trading Day" shall mean a day on which the
principal national securities exchange on which the Security is
listed or admitted to trading is open for the transaction of
business or, if the Security is not listed or admitted to trading
on any national securities exchange, a Business Day.
(ii) For the purpose of any computation hereunder, the
"current per share market price" of the Preferred Shares shall be
determined in accordance with the method set forth in Section
11(d)(i). If the Preferred Shares are not publicly traded, the
"current per share market price" of the Preferred Shares shall be
conclusively deemed to be the current per share market price of the
Common Shares as determined pursuant to Section 11(d)(i)
(appropriately adjusted to reflect any stock split, stock dividend
or similar transaction occurring after the date hereof), multiplied
by 1000. If neither the Common Shares nor the Preferred Shares are
publicly held or so listed or traded, "current per share market
price" shall mean the fair value per share as determined in good
faith b
<PAGE>
the Board of Directors of the Company, whose determination shall
be described in a statement filed with the Rights Agent.
(e) No adjustment in the Purchase Price shall be
required unless such adjustment would require an increase or
decrease of at least 1% in the Purchase Price; provided, however,
that any adjustments which by reason of this Section 11(e) are
not required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under
this Section 11 shall be made to the nearest cent or to the
nearest one ten millionth of a Preferred Share or one ten-
thousandth of any other share or security as the case may be.
Notwithstanding the first sentence of this Section 11(e), any
adjustment required by this Section 11 shall be made no later
than three years from the date of the transaction which requires
such adjustment.
(f) If as a result of an adjustment made pursuant to
Section 11(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 Shares, the number of
such other shares so receivable upon exercise of any Right shall
thereafter be subject to adjustment from time to time in a manner
and on terms a
<PAGE>
nearly equivalent as practicable to the provisions with respect
to the Preferred Shares contained in Section 11(a) through (c),
inclusive, and the provisions of Sections 7, 9, 10 and 13 with
respect to the Preferred Shares shall apply on like terms to any
such other shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder
shall evidence the right to purchase, at the adjusted Purchase
Price, the number of one one-thousandths of a Preferred Share
purchasable from time to time hereunder upon exercise of the
Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its
election as provided in Section 11(i), upon each adjustment of
the Purchase 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 Purchase Price, that number of
one onethousandths of a Preferred Share (calculated to the
nearest one tenmillionth of a Preferred Share) obtained by (i)
multiplying (x) the number of one one-thousandths of a share
covered by a Right immediately prior to
<PAGE>
this adjustment by (y) the Purchase Price in effect immediately
prior to such adjustment of the Purchase Price and (ii) dividing
the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights
in substitution for any adjustment in the number of one
onethousandths of a Preferred Share 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 onethousandths of a Preferred Share 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
hundred-thousandth) obtained by dividing the Purchase Price in
effect immediately prior to adjustment of the Purchase Price by
the Purchase Price in effect immediately after adjustment of the
Purchase Price. The Company shall make a public announcement of
its election to adjust the number of Rights, indicating the
record date for the adjustment, and, if known at the time, the
amount of the adjustment to be made.
<PAGE>
This record date may be the date on which the Purchase Price is
adjusted or any day thereafter, but, if the Right Certificates
have been distributed, shall be at least 10 days later than the
date of the public announcement. If Right Certificates have been
distributed, upon each adjustment of the number of Rights
pursuant to this Section 11(i), the Company shall, as promptly as
practicable, cause to be distributed to holders of record of
Right Certificates on such record date Right 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 Right Certificates held
by such
holders prior to the date of adjustment, and upon surrender
thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders shall be entitled
after such adjustment. Right Certificates to be so 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 Right Certificates on the record date
specified in the public announcement.
<PAGE>
(j) Irrespective of any adjustment or change in the
Purchase Price or the number of one one-thousandths of a
Preferred Share issuable upon the exercise of the Rights, the
Right Certificates theretofore and thereafter issued may continue
to express the Purchase Price and the number of one one-
thousandths of a Preferred Share which were expressed in the
initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an
adjustment reducing the Purchase Price below one one-thousandth
of the then par value of the Preferred Shares issuable upon
exercise of the Rights, the Company shall take any corporate
action which may, in the opinion of its counsel, be necessary in
order that the Company may validly and legally issue fully paid
and nonassessable Preferred Shares at such adjusted Purchase
Price.
(1) In any case in which this Section 11 shall require
that an adjustment in the Purchase Price be made effective as of
a record date for a specified event, the Company may elect to
defer
until the occurrence of such event the issuing to the holder of
any Right exercised after such record date of the Preferred
Shares and other capital stock or securities of the Company, if
any, issuabl
<PAGE>
upon such exercise over and above the Preferred Shares and other
capital stock or securities of the Company, if any, issuable upon
such exercise on the basis of the Purchase Price in effect prior
to such adjustment; provided, however, that the Company shall
deliver to such holder a due bill or other appropriate instrument
evidencing such holder's right to receive such additional shares
upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such
reductions in the Purchase Price, in addition to those adjustments
expressly required by this Section 11, as and to the extent that it
in its sole discretion shall determine to be advisable in order
that any (i) consolidation or subdivision of the Preferred Shares,
(ii) issuance wholly for cash of any Preferred Shares at less than
the current market price, (iii) issuance wholly for cash of
Preferred Shares or securities which by their terms are convertible
into or exchangeable for Preferred Shares, (iv) dividends on
Preferred Shares payable in Preferred Shares or (v) issuance of any
rights, options or warrants referred to hereinabove in Section
11(b), hereafter made by the Company to holders of its Preferred
Shares shall not be taxable to such stockholders.
<PAGE>
(n) 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 Shares payable in
Common Shares or (ii) effect a subdivision, combination or
consolidation of the Common Shares (by reclassification or
otherwise other than by payment of dividends in Common Shares)
into
a greater or lesser number of Common Shares, then in any such
case (i) the number of one one-thousandths of a Preferred Share
purchasable after such event upon proper exercise of each Right
shall be determined by multiplying the number of one
onethousandths of a Preferred Share so purchasable immediately
prior
to such event by a fraction, the numerator of which is the number
of Common Shares outstanding immediately before such event and
the denominator of which is the number of Common Shares
outstanding immediately after such event, and (ii) each Common
Share outstanding immediately after such event shall have issued
with respect to it that number of Rights which each Common Share
outstanding immediately prior to such event had issued with
respect to it. The adjustments provided for in this Section
11(n) shall b
<PAGE>
made successively whenever such a dividend is declared or paid or
such a subdivision, combination or consolidation is effected.
Section 12. Certificate of Adjustment. Whenever an
adjustment is made as provided in Sections 11 and 13 hereof, the
Company shall promptly (a) prepare a certificate setting forth
such adjustment, and a brief statement of the facts accounting
for such adjustment, (b) file with the Rights Agent and with each
transfer agent of the Common Shares or the Preferred Shares a
copy of such certificate and (c) mail a brief summary thereof to
each holder of a Right Certificate in accordance with Section 25
hereof. The Rights
Agent shall be fully protected in relying on any such certificate
and on any adjustment therein contained.
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power. In the event that, at any time after a
Person becomes an Acquiring Person, directly or indirectly, (i)
the Company shall consolidate with, or merge with and into, any
other Person, (ii) any Person shall consolidate with the Company,
or merge with and into the Company and the Company shall be the
continuing or surviving corporation of such merger and, in
connection with such merger, all or part of the Common Shares
shall be changed into or exchanged for stock or other securities
of an
<PAGE>
other Person (or the Company) or cash or any other property, or
(iii) the Company shall sell or otherwise transfer (or one or more
of its Subsidiaries shall sell or otherwise transfer), in one or
more transactions, assets or earning power aggregating 50% or more
of the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any other Person other than the Company or one
or more of its wholly-owned Subsidiaries, then, and in each
such case, proper provision shall be made so that (A) each holder of
a Right (except as otherwise provided herein) shall thereafter have
the right to receive, upon the exercise thereof at a price equal to
the then current Purchase Price multiplied by the number of one one
thousandths of a Preferred Share for which a Right is then
exercisable, in accordance with the terms of this Agreement and in
lieu of Preferred Shares, such number of Common Shares of such
other Person (including the Company as successor thereto or as the
surviving corporation) as shall equal the result obtained by (x)
multiplying the then current Purchase Price by the number of one
onethousandths of a Preferred Share for which a Right is then
exercisable and dividing that product by (y) 50% of the then
current per share market price of the Common Shares of such other
Person (determined pursuant to Section 11(d) hereof) on the date o
<PAGE>
consummation of such consolidation, merger, sale or transfer; (B)
the issuer of such Common Shares shall thereafter be liable for,
and shall assume, by virtue of such consolidation, merger, sale or
transfer, all the obligations and duties of the Company pursuant to
this Agreement; (C) the term "Company" shall thereafter be deemed
to refer to such issuer; and (D) such issuer shall take such steps
(including, but not limited to, the reservation of a sufficient
number of its Common Shares in accordance with 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 the Common Shares
thereafter deliverable upon the exercise of the Rights. The
Company covenants and agrees that it shall not consummate any such
consolidation, merger, sale or transfer unless prior thereto the
Company and such issuer shall have executed and delivered to the
Rights Agent a supplemental agreement so providing. The Company
shall not enter into any transaction of the kind referred to in
this Section 13 if at the time of such transaction there are any
rights, warrants, instruments or securities outstanding or any
agreements or arrangements which, as a result of the consummation
of such transaction, would eliminate or substantially diminish the
benefit
<PAGE>
intended to be afforded by the Rights. The provisions of this
Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers. For purposes hereof,
the "earning power" of the Company and its Subsidiaries shall be
determined in good faith by the Company's Board of Directors on
the basis of the operating earnings of each business operated by
the Company and its Subsidiaries during the three fiscal years
preceding the date of such determination (or, in the case of any
business not operated by the Company or any Subsidiary during
three full fiscal years preceding such date, during the period
such business was operated by the Company or any Subsidiary).
Section 14. Fractional Rights and Fractional Shares. (a)
The Company shall not be required to issue fractions of Rights or
to distribute Right Certificates which evidence
fractional Rights. In lieu of such fractional Rights, there
shall be paid to the registered holders of the Right Certificates
with regard to which such fractional Rights would otherwise be
issuable, an amount in cash equal to the same fraction of the
current market value of a whole Right. For the purposes of this
Section 14(a), the current market value of a whole Right shall be
the closing price o
<PAGE>
the Rights for the Trading Day immediately prior to the date on
which such fractional Rights would have been otherwise issuable.
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 principal consolidated transaction
reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the Rights are not
listed or admitted to trading on the New York Stock Exchange, as
reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal
national securities exchange on which the Rights are listed or
admitted to trading or, if the
Rights are not listed or admitted to trading on any national
securities exchange, the last quoted price or, if not so quoted,
the average of the high bid and low asked prices in the over-the
counter market, as reported by NASDAQ or such other system then
in use or, if on any such date the Rights are not quoted by any
such organization, the average of the closing bid and asked
prices as furnished by a professional market maker making a
market in the Rights selected
<PAGE>
by the Board of Directors of the Company. If on any such date no
such market maker is making a market in the Rights, the fair
value of the Rights on such date as determined in good faith by
the Board of Directors of the Company shall be used.
(b) The Company shall not be required to issue fractions of
Preferred Shares (other than fractions which are integral
multiples of one one-thousandth of a Preferred Share) upon
exercise of the Rights or to distribute certificates which
evidence fractional Preferred Shares (other than fractions which
are integral multiples of one one-thousandth of a Preferred
Share). Fractions of Preferred Shares in integral multiples of
one one-thousandth of a Preferred Share may, at the election of
the Company, be evidenced by depositary receipts, pursuant to an
appropriate agreement between the Company and a depositary
selected by it; provided, that such agreement shall provide that
the holders of such depositary receipts shall have all the
rights, privileges and preferences to which they
are entitled as beneficial owners of the Preferred Shares
represented by such depositary receipts. In lieu of fractional
Preferred Shares that are not integral multiples of one one
thousandth of a Preferred
<PAGE>
selected Share, the Company shall pay to each registered holder
of Right Certificates at the time such Rights are exercised as
herein provided an amount in cash equal to the same fraction of
the current market value of one Preferred Share as the fraction
of one Preferred Share that such holder would otherwise receive
upon the exercise of the aggregate number of rights exercised by
such holder. For the purposes of this Section 14(b), the current
market value of a Preferred Share shall be the closing price of a
Preferred Share (as determined pursuant to the second sentence of
Section 11(d)(i) hereof) for the Trading Day immediately prior to
the date of such exercise.
(c) The holder of a Right by the acceptance of the Right
expressly waives any right to receive fractional Rights or
fractional shares upon exercise of a Right (except as provided
above).
Section 15. Rights of Action. All rights of action in
respect of this Agreement, excepting the rights of action given
to the Rights Agent under Section 18 hereof, are vested in the
respective registered holders of the Right Certificates (and,
prior to the Distribution Date, the registered holders of the
Common Shares); and any registered holder of any Right
Certificate (or,
<PAGE>
prior to the Distribution Date, of the Common Shares) may,
without the consent of the Rights Agent or of the holder of any
other Right Certificate (or, prior to the Distribution Date, of
the Common
Shares), on his own behalf and for his own benefit, enforce, and
may institute and maintain any suit, action or proceeding against
the Company to enforce, or otherwise act in respect of, his right
to exercise the Rights evidenced by such Right Certificate in the
manner provided in such Right Certificate and in this Agreement.
Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the
holders of Rights would not have an adequate remedy at law for
any breach of this Agreement and will be entitled to specific
performance of the obligations under, and injunctive relief
against actual or threatened violations of the obligations of any
Person subject to, this Agreement.
Section 16. Agreement of Right Holders. Every holder of a
Right, by accepting the same, consents and agrees with the
Company and the Rights Agent and with every other holder of a
Right that:
<PAGE>
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common
Shares;
(b) after the Distribution Date, the Right Certificates
are transferable only on the registry books maintained by the
Rights Agent if surrendered at the principal office of the Rights
Agent, duly endorsed or accompanied by a proper instrument of
transfer with a completed form of certification; and
(c) the Company and the Rights Agent may deem and
treat the person in whose name the Right Certificate (or, prior to
the Distribution Date, the associated Common Shares certificate) is
registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the associated Common Shares
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. Section 17. Right
Certificate Holder Not Deemed a
Stockholder. No holder, as such, of any Right Certificate shall be
entitled to vote, receive dividends or be deemed for any purpose
the holder of the Preferred Shares or any other securities of th
<PAGE>
Company which may at any time be issuable on the exercise of the
Rights represented thereby nor shall anything contained herein or
in any Right Certificate be construed to confer upon the holder of
any Right Certificate, as such, any of the rights of a stockholder
of the Company or any right to vote for the election of directors
or upon any matter submitted to stockholders at any meeting
thereof, or to give or withhold consent to any corporate action, or
to receive notice of meetings or other actions affecting
stockholders (except as provided in Section 25 hereof), or to
receive dividends or subscription rights, or otherwise, until the
Right or Rights evidenced by such Right Certificate shall have been
exercised in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent. The Company
agrees to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on demand
of the Rights Agent, its reasonable expenses and counsel fees and
other disbursements incurred in the administration and execution of
this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent
for, and to hold it harmless against, any loss, liability, or
expense, incurred without gross negligence, bad faith or willful
misconduct
<PAGE>
on the part of the Rights Agent, for anything done or omitted by
the Rights Agent in connection with the acceptance and
administration of this Agreement, including the costs and expenses
of defending against any claim or liability in connection
therewith.
The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or omitted
by it in connection with its administration of this Agreement in
reliance upon any Right Certificate or certificate for Preferred
Stock or for other securities of the Company, instrument of
assignment or transfer, power of attorney, endorsement, affidavit,
letter, notice, direction, consent, certificate, statement, or other
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 or Change of Name of Rights
Agent. Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or
any corporation resulting from any merger or consolidation to which
the Rights Agent or any successor Rights Agent shall be a party, or
any corporation succeeding to the corporate trust business of the
Rights Agent or any successor Rights Agent, shall be the successor
to the Rights Agent under this Agreement without the execution or
filing of any paper or any
<PAGE>
further act on the part of any of the parties hereto, provided that
such corporation would be eligible for appointment as a successor
Rights Agent under the provisions of Section 21 hereof. In case at
the time such successor Rights Agent shall succeed to the agency
created by this Agreement, any of the Right Certificates shall have
been countersigned but not delivered, any such successor Rights
Agent may adopt the countersignature of the predecessor Rights Agent
and deliver such Right Certificates so countersigned; and in case at
that time any of the Right Certificates shall not have been
countersigned, any successor Rights Agent may countersign such Right
Certificates either in the name of the predecessor Rights Agent or
in the name of the successor Rights Agent; and in all such cases
such Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall be changed
and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Right Certificates
so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, the Rights Agent may
countersign such Right Certificates either in its prior name or in
its changed name; and in all such cases such Right Certificates
<PAGE>
shall have the full force provided in the Right Certificates and in
this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes
the duties and obligations expressly set forth in this Agreement and
no implied duties or obligations shall be read into this Agreement
against the Rights Agent. The Rights Agent shall perform those
duties and obligations upon the following terms and conditions, by
all of which the Company and the holders of Right Certificates, by
their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel
(who may be legal counsel for the Company), and the opinion of such
counsel shall be full and complete authorization and protection to
the Rights Agent as to any action taken or omitted by it in good
faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that
any fact or matter be proved or established by the Company prior to
taking or suffering any action hereunder, such fact or matter
(unless other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and established
by a certificate signed by any one of the Chairman
<PAGE>
of the Board, the President, a Vice President, the Treasurer or the
Secretary of the Company and delivered to the Rights Agent; and such
certificate shall be full authorization to the Rights Agent for any
action taken or suffered in good faith by it under the provisions of
this Agreement in reliance upon such certificate. (c) The Rights
Agent shall be liable hereunder only for
its own gross negligence, bad faith or willful misconduct. (d)
The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained in
this Agreement or in the Right Certificates (except as to its
countersignature thereof) or be required to verify the same, but all
such statements and recitals are and shall be deemed to have been
made by the Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and
delivery hereof (except the due execution hereof by the Rights
Agent) or in respect of the validity or execution of any Right
Certificate (except its countersignature thereof); nor shall it be
responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any Right Certificate;
nor shall it be responsible for any adjustment required under the
provisions of Sections 11 or 13 hereof or responsible for the
manner, method or amount of any such adjustment or the
<PAGE>
ascertaining of the existence of facts that would require any such
adjustment (except with respect to the exercise of Rights evidenced
by Right Certificates after actual notice of 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
Agreement or any Right Certificate or as to whether any shares of
Preferred Stock will, when so issued, be validly authorized and
issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged end delivered all such further and other acts,
instruments and assurances as may reasonably be required by the
Rights Agent for the carrying out or performing by the Rights Agent
of the provisions of this Agreement. (g) The Rights Agent is
hereby authorized and directed to accept instructions with respect
to the performance of its duties hereunder from any one of the
Chairman of the Board, the President, a Vice President, the
Secretary or the Treasurer of the Company, and to apply to such
officers for advice or instructions in connection with
its duties, and it shall not be liable for any action taken or
suffered to be taken by it in good faith in accordance with
instructions of any such officer.
<PAGE>
(h) The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal in any
of the Rights or other securities of the Company or become
pecuniarily interested in any transaction in which the Company may
be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Rights Agent
under this Agreement. Nothing herein shall preclude the Rights
Agent from acting in any other capacity for the Company or for any
other legal entity.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents,
and the Rights Agent shall not be answerable or accountable for any
act, default, neglect or misconduct of any such attorneys or agents
or for any loss to the Company resulting from any such act, default,
neglect or misconduct, provided reasonable care was exercised in the
selection and continued employment thereof.
Section 21. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties
under this Agreement upon 30 days' notice in writing mailed to the
Company and to each transfer agent of the Common Shares and the
Preferred Stock by registered or certified mail, and to the holders
of the Right Certificates by first-class mail. The Company
<PAGE>
may remove the Rights Agent or any successor Rights Agent upon 30
days' notice in writing, mailed to the Rights Agent or successor
Rights Agent, as the case may be, and to each transfer agent of the
Common Shares and the Preferred Stock by registered or certified
mail, and to the holders of the Right Certificates by first-class
mail. If the Rights Agent shall resign or be removed or shall
otherwise become incapable of acting, the Company shall appoint a
successor to the Rights Agent. If the Company shall fail to make
such appointment within a period of 30 days after giving notice of
such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights
Agent or by the holder of a Right Certificate (who shall, with such
notice, submit his Right Certificate for inspection by the Company),
then the registered holder of any Right Certificate may apply to any
court of competent jurisdiction for the appointment of a new Rights
Agent. Any successor Rights Agent, whether appointed by the Company
or by such a court, shall be a corporation organized and
doing business under the laws of the United States or of any state
of the United States, in good standing, having an office in the
State of New York or the Commonwealth of Massachusetts which is
authorized under such laws to exercise corporate trust powers and i
<PAGE>
subject to supervision or examination by federal or state authority
and which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $100 million. 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 Shares and the Preferred Stock,
and mail a notice thereof in writing to the registered holders of
the Right Certificates. Failure to give any notice provided for
in this Section 21, however, or any defect therein, shall not
affect the legality or validity of the resignation or removal of
the Rights Agent or the appointment of the successor Rights Agent,
as the case may be.
Section 22. Issuance of New Right Certificates.
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new
Right Certificates evidencing Rights in such form as may be
<PAGE>
approved by its Board of Directors to reflect any adjustment or
change in the Purchase Price and the number or kind or class of
shares or other securities or property purchasable under the Right
Certificates made in accordance with the provisions of this
Agreement.
Section 23. Redemption.
(a) The Board of Directors of the Company may, at its
option, at any time prior to such time as any Person becomes an
Acquiring Person, redeem all but not less than all the then
outstanding Rights at a redemption price of $0.001 per Right,
appropriately adjusted to reflect any stock split, stock dividend
or similar transaction occurring after the date hereof (such
redemption price being hereinafter referred to as the "Redemption
Price"). The redemption of the Rights by the Board of Directors
may be made effective at such time, on such basis and subject to
such conditions as the Board of Directors in its sole discretion
may establish.
(b) Immediately upon the action of the Board of Directors of
the Company ordering the redemption of the Rights pursuant to
paragraph (a) of this Section 23, and without any further action
and
without any notice, the right to exercise the Rights will
terminate and the only right thereafter of the holders of Rights
shall be to receive the Redemption Price. The Company shall
promptly give public notice of any such redemption; provided,
however, that
<PAGE>
the failure to give, or any defect in, any such notice shall not
affect the validity of such redemption. Within 10 days after such
action of the Board of Directors ordering the redemption of the
Rights
pursuant to paragraph (a), the Company shall mail a notice of
redemption to all the holders of the then outstanding Rights 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 Shares. Any notice
which is mailed in the manner herein provided shall be deemed
given, whether or not the holder receives the notice. If the
payment of the Redemption Price is not included with such notice,
each such notice shall state the method by which the payment of
the Redemption Price will be made. Neither the Company nor any of
its Affiliates or Associates may redeem, acquire or purchase for
value any Rights at any time in any manner other than that
specifically set forth in this Section 23 or in Section 24 hereof,
other than in connection with the purchase of Common Shares prior
to the Distribution Date. Section 24. Exchange.
(a) The Board of Directors of the Company may, at its
option, at any time after any Person becomes an Acquiring
Person, exchange all or part of the then outstanding and
exercisable Rights (which shall not include Rights that have
become void pursuant to the provisions of Section 11(a)(ii)
hereof) for Common Shares at an
<PAGE>
exchange ratio of one Common Share per Right,
appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof
(such exchange ratio being hereinafter referred to as the
"Exchange Ratio"). Notwithstanding the foregoing, the Board of
Directors shall not be empowered to effect such exchange at any
time after any Person (other than the Company, any Subsidiary of
the Company, any employee benefit plan of the Company or any
such Subsidiary, or any entity holding Common Shares for or
pursuant to the terms of
any such plan), together with all Affiliates and Associates of
such Person, becomes the Beneficial Owner of a majority of the
Common Shares then outstanding.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the exchange of any Rights
pursuant to subsection (a) of this Section 24 and without any
further action and without any notice, the right to exercise such
Rights shall terminate and the only right thereafter of a holder of
such Rights shall be to receive that number of Common Shares equal
to the number of such Rights held by such holder multiplied by the
Exchange Ratio. The Company shall promptly give public notice of
any such exchange; provided, however, that the failure to give, or
any defect in, such notice shall not affect the validity of such
exchange. The Company promptly shall mail a notice of any such
<PAGE>
exchange to all of the holders of such Rights at their last
addresses as they appear upon the registry books of the Rights
Agent. Any notice which is mailed in the manner herein provided
shall be deemed given, whether or not the holder receives the
notice. Each
such notice of exchange will state the method by which the exchange
of the Common Shares for Rights will be effected and, in the event
of any partial exchange, the number of Rights which will
be exchanged. Any partial exchange shall be effected pro rata
based on the number of Rights (other than Rights which have become
void pursuant to the provisions of Section 11(a)(ii) hereof) held
by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the
Company, at its option, may substitute Preferred Shares or common
stock equivalents for Common Shares exchangeable for Rights, at the
initial rate of one one-thousandth of a Preferred Share (or an
appropriate number of common stock equivalents) for each Common
Share, as appropriately adjusted to reflect adjustments in the
voting rights of the Preferred Shares pursuant to the terms
thereof, so that the fraction of a Preferred Share delivered in
lieu of each Common Share shall have the same voting rights as one
Common Share.
(d) In the event that there shall not be sufficient Common
Shares, Preferred Shares or common stock equivalents authorized by
the Company's certificate of incorporation and not
<PAGE>
outstanding or subscribed for, or reserved or otherwise committed
for
issuance for purposes other than upon exercise of Rights, to
permit any exchange of Rights as contemplated in accordance with
this Section 24, the Company shall take all such action as may be
necessary to authorize additional Common Shares, Preferred Shares
or common stock equivalents for issuance upon exchange of the
Rights.
(e) The Company shall not be required to issue fractions of
Common Shares or to distribute certificates which evidence
fractional Common Shares. In lieu of such fractional Common
Shares, the Company shall pay to the registered holders of the
Right Certificates with regard to which such fractional Common
Shares would otherwise be issuable an amount in cash equal to the
same fraction of the current per share market value of a whole
Common Share. For the purposes of this paragraph (e), the current
per share market value of a whole Common Share shall be the
closing price of a Common Share (as determined pursuant to the
second sentence of
<PAGE>
Section 11(d)(i) hereof) for the Trading Day immediately prior
to the date of exchange pursuant to this Section 24.
Section 25. Notice of Certain Events.
(a) In case the Company shall after the Distribution Date propose
(i) to pay any dividend payable in stock of any class to the holders
of its Preferred Shares or to make any other distribution to the
holders of its Preferred Shares (other than a regular quarterly cash
dividend), (ii) to offer to the holders of its Preferred Shares
rights or warrants to subscribe for or to purchase any additional
Preferred Shares or shares of stock of any class or any other
securities, rights
or options, (iii) to effect any reclassification of its Preferred
Shares (other than a reclassification involving only the subdivision
of outstanding Preferred Shares), (iv) to effect any consolidation or
merger into or with, 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 50% or more of the assets
or earning power of the Company and its Subsidiaries (taken as a
whole) to, any other Person, (v) to effect the liquidation,
dissolution or winding up of
<PAGE>
the Company, or (vi) to declare or pay any dividend on the Common
Shares payable in Common Shares or to effect a subdivision,
combination or consolidation of the Common Shares (by
reclassification or otherwise than by payment of dividends in Common
Shares), then, in each such case, the Company shall give to each
holder of a Right Certificate, in accordance with Section 26 hereof,
a 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, transfer, liquidation, dissolution, or
winding up is to take place and the date of participation therein by
the holders of the Common Shares and/or Preferred Shares, 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 10 days prior
to the record date for determining holders of the Preferred Shares
for purposes of such action, and in the case of any
such other action, at least 10 days prior to the date of the taking
of such proposed action or the date of participation therein by the
holders of the Common Shares and/or Preferred Shares, whichever shall
be the earlier.
(b) In case any event set forth in Section 11(a)(ii)
hereof shall occur, then the Company shall as soon as practicable
<PAGE>
thereafter give to each holder of a Right 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 Agreement to be given or made by the Rights Agent or by the
holder of any Right 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:
ABIOMED, Inc.
33 Cherry Hill Drive
Danvers, Massachusetts 01923
Attention: Secretary
Subject to the provisions of Section 21 hereof, any notice or
demand authorized by this Agreement to be given or made by the
Company
or by the holder of any Right Certificate to or on the Rights
Agent shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed (until another address is filed
in writing with the Company) as follows:
BankBoston, N.A.
c/o Boston EquiServe
150 Royall Street
Canton, Massachusetts 02021
<PAGE>
Notices or demands authorized by this Agreement to be given or made
by the Company or the Rights Agent to the holder of any Right
Certificate shall be sufficiently given or made if sent by first
class mail, postage prepaid, addressed to such holder at the
address of
such holder as shown on the registry books of the Company. Section
27.Supplements and Amendments. The Company
may from time to time, and the Rights Agent shall, if the Company
so directs, supplement or amend this Agreement without the approval
of any holders of Right Certificates in order to cure any
ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with any other provisions
herein, or to make any change to or delete any provision hereof or
to adopt any other provisions with respect to the Rights which the
Company may deem necessary or desirable. Any such supplement or
amendment will be evidenced by a writing signed by the Company and
the Rights Agent; provided, however, that from and after such time
as any Person becomes an Acquiring Person, this Agreement shall not
be amended or supplemented in any manner which would
adversely affect the interests of the holders of Rights (other than
an Acquiring Person and its Affiliates and Associates).
Section 28. Successors. All the covenants and
provisions of this Agreement by or for the benefit of the
Company or th
<PAGE>
Rights Agent shall bind and inure to the benefit of their respective
successors and assigns hereunder.
Section 29. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than the
Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the Common Shares)
any legal or equitable right, remedy or claim under this Agreement; but
this Agreement shall be for the sole and exclusive benefit of the
Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the Common Shares).
Section 30. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Agreement shall remain in full force and effect and
shall in no way be affected, impaired or invalidated.
<PAGE>
Section 31. Governing Law. This Agreement and each
Right Certificate issued hereunder shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be
governed by and construed in accordance with the laws of such State
applicable to contracts to be made and performed entirely within such
State.
Section 32. Counterparts. This Agreement may be executed
in any number of counterparts and each of such counterparts shall for
all purposes be deemed to be an original, and all such counterparts
shall together constitute but one and the same instrument.
Section 33. Descriptive Headings. Descriptive headings of
the several Sections of this Agreement are inserted for convenience only
and shall not control or affect the meaning or construction of any of
the provisions hereof.
Section 34. Administration. The Board of Directors of the Company
shall have the exclusive power and authority to administer and interpret
the provisions of this Agreement and to exercise all rights and powers
specifically granted to the Board of Directors or the Company or as may
be necessary or advisable in the administration of this Agreement. All
such actions, calculations, determinations and interpretations which are
done or made by the Board of Directors in good faith shall be final,
conclusive an
<PAGE>
binding on the Company, the Rights Agent, the holders of the Rights
and all other parties and shall not subject the Board of Directors to
any liability to the holders of the Rights.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Rights Agreement to be duly executed and their respective corporate
seals to be hereunder affixed and attested, all as of the day and year
first above written.
Attest: ABIOMED, INC.
/s/ Philip J. Flink By: /s/ David M. Lederman
Philip J. Flink,
Secretary
David M. Lederman,
President and
Chief Executive
Officer
Attest: BANKBOSTON, N.A.
/s/Jocelyn J. Turner, Account Manager By:
/s/ Michael J. Lapolla, Administration
Manager
<PAGE>
Exhibit A
CERTIFICATE OF DESIGNATIONS
of
SERIES A JUNIOR PARTICIPATING PREFERRED
STOCK of
ABIOMED, INC.
(Pursuant to Section 151 of the
Delaware General Corporation Law)
ABIOMED, Inc., a corporation organized and existing under
the General Corporation Law of the State of Delaware (hereinafter
called the "Corporation"), hereby certifies that the following
resolution was adopted by the Board of Directors of the
Corporation as required by Section 151 of the General Corporation
Law at a meeting duly called and held on August 13, 1997:
RESOLVED, that pursuant to the authority granted to and
vested in the Board of Directors of this Corporation (hereinafter
called the "Board of Directors" or the "Board") in accordance with
the provisions of the Certificate of Incorporation of the
Corporation, the Board of Directors hereby designate 25,000 shares
of the Corporation's Class B Preferred Stock, par value $0.01 per
share, as "Series A Junior Participating Preferred Stock" of the
Corporation and hereby states the designation and number of shares,
and fixes the relative rights, preferences, and limitations thereof
as follows:
Series A Junior Participating Preferred Stock:
Section 1. Designation and Amount. The shares of this series
shall be designated as "Series A Junior Participating Preferred
Stock" (the "Series A Preferred Stock") and the number of share
<PAGE>
constituting the Series A Preferred Stock shall be 25,000. Such
number of shares may be increased or decreased by resolution of the
Board of Directors; provided, that no decrease shall reduce the
number of shares of Series A Preferred Stock to a number less than
the number of shares then outstanding plus the number of shares
reserved for issuance upon the exercise of outstanding options,
rights or warrants or upon the conversion of any outstanding
securities issued by the Corporation convertible into Series A
Preferred Stock.
<PAGE>
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of
any series of Preferred Stock (or any other stock) ranking prior
and superior to the Series A Preferred Stock with respect to
dividends, the holders of shares of Series A Preferred 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 last day of March, June, September
and December in each year (each such date being referred to herein
as a "Quarterly Dividend Payment Date"), commencing on the first
Quarterly
Dividend Payment Date after the first issuance of a share or
fraction of a share of Series A Preferred Stock, in an amount (if
any) per share (rounded to the nearest cent), subject to the
provision for
adjustment hereinafter set forth, equal to 1000 times the
aggregate per share amount of all cash dividends, and 1000 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, par value $0.01 per share (the "Common
Stock"), of the Company or a subdivision of the outstanding shares
of Common Stock (by reclassification or otherwise), declared on
the Common Stock since the immediately preceding Quarterly
Dividend Payment Date or, with respect to the first Quarterly
Dividend
Payment Date, since the first issuance of any share or fraction of
a share of Series A Preferred Stock. In the event the Corporation
shall at any time 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 A Preferred Stock were
entitled immediately prior to such event under 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.
<PAGE>
(B) The Corporation shall declare a dividend or distribution
on the Series A Preferred Stock as provided in paragraph (A) of
this Section immediately after it declares a dividend or
distribution on the Common Stock (other than a dividend payable in
shares of Common Stock).
(C) Dividends due pursuant to paragraph (A) of this Section
shall begin to accrue and be cumulative on outstanding shares of
Series A Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares,
unless the date of issue of such shares is prior to the record
date for the first Quarterly Dividend Payment Date, in which case
dividends on such shares shall begin to accrue from the date of
issue of such shares, or unless the date of issue is a Quarterly
Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Preferred Stock
entitled to receive a quarterly dividend and before such Quarterly
Dividend Payment Date, in either of which events such dividends
shall begin to accrue and be cumulative from such Quarterly
Dividend Payment Date. Accrued but unpaid dividends shall not bear
interest. Dividends paid on the shares of Series A Preferred
Stock in an amount less than the total amount of such dividends at
the time accrued and payable on such shares shall be allocated pro
rata on a share-by share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for the
determination of holders of shares of Series A Preferred Stock
entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be not more than 60 days prior to
the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter
set forth, each share of Series A Preferred Stock shall entitle
the holder thereof to 1000 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 numbe
<PAGE>
of shares of Common Stock, then in each such case the number of
votes per share to which holders of shares of Series A Preferred
Stock were entitled immediately prior to such event shall be
adjusted by multiplying such number by a fraction, the numerator
of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately
prior to such event.
(B) Except as otherwise provided in the Certificate of
Incorporation of the Company, including any other Certificate of
Designations creating a series of Preferred Stock or any similar
stock, or by law, the holders of shares of Series A 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 A Preferred Stock shall have no special
voting rights and their consent shall not be required (except to
the extent they are entitled to vote with holders of Common Stock
as set forth herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided
in Section 2 are in arrears, thereafter and until all accrued and
unpaid dividends and distributions, whether or not declared, on
shares of Series A Preferred Stock outstanding shall have been
paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock;
(ii) declare or pay dividends, 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)
wit
<PAGE>
the Series A Preferred Stock, except dividends paid ratably on the
Series A Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the total
amounts to which the holders of all such shares are then entitled;
or (iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such
junior stock in exchange for shares of any stock of the
Corporation ranking junior (as to dividends and-upon dissolution,
liquidation or winding up) to the Series A Preferred Stock.
(B) The Corporation shall not permit any subsidiary of
the Corporation to purchase or otherwise acquire for consideration
any shares of stock of the Corporation unless the Corporation
could, under paragraph (A) of this Section 4, purchase or
otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A
Preferred Stock purchased or otherwise acquired by the Corporation
in any manner whatsoever shall be retired and 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 Certificate of Incorporation of the Company,
including any Certificate of Designations creating a series of
Preferred Stock or any similar stock or as otherwise required by
law.
Section 6. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation the
holders of shares of Series A Preferred Stock shall be entitled to
receive an aggregate amount per share, subject to the provision
for adjustment hereinafter set forth, equal to 1000 times the
aggregate amount to be distributed per share to holders of shares
of Common Stock plus an amount equal to any accrued and unpaid
dividends. In the event the Corporation shall at any time declare
or pay any dividend on the Common Stock payable in shares of
Common Stock,
<PAGE>
or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock)
into a greater or lesser number of shares of Common Stock, then in
each such case the aggregate amount to which holders of shares of
Series A Preferred Stock were entitled immediately prior to such
event under the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of which is
the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such
event. Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common
Stock are exchanged for or changed into other stock or securities,
cash and/or any other property, then in any such case each share
of Series A 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 1000
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 A Preferred Stock shall be
adjusted by
multiplying such amount by a fraction, the numerator of which is
the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such
event. Section 8. Redemption. The shares of Series A
Preferred Stock shall not be redeemable.
<PAGE>
Section 9. Ranking. Unless otherwise provided in the
Certificate of Incorporation or a Certificate of Designations
relating to a subsequently-designated series of preferred stock of
the Corporation, the Series A Preferred Stock shall rank junior to
any other series of the Corporation's preferred stock subsequently
issued, as to the payment of dividends and the distribution of
assets on liquidation, dissolution or winding up and shall rank
senior to the Common Stock. Section 10. Amendment. The
Certificate of Incorporation
of the Corporation shall not be amended in any manner, including in
a merger or consolidation, which would alter, change, or repeal the
powers, preferences or special rights of the Series A Preferred
Stock so as to affect them adversely without the affirmative vote
of the holders of at least two-thirds of the outstanding shares of
Series A Preferred Stock, voting together as a single class.
Section 11. Fractional Shares. Series A Preferred Stock
may be issued in whole shares or in any fraction of a share that is
one one-thousandth of a share or any integral multiple of such
fraction, which shall entitle the holder, in proportion to such
holder's fractional shares, to exercise voting rights, receive
dividends, participate in distributions and to have the benefit of
all other rights of holders of Series A Preferred Stock. In lieu of
fractional shares, the Corporation may elect to make a cash payment
as provided in the Rights Agreement for fractions of a share other
than one one-thousandth of a share or any integral multiple thereof
<PAGE>
IN WITNESS WHEREOF, this Certificate of Designations is
executed on behalf of the Corporation by its President this 13th
day of August, 1997.
ABIOMED, INC.
By:
David M. Lederman
<PAGE>
Exhibit B
Form of Right Certificate
Certificate No R- ______ Rights
NOT EXERCISABLE AFTER AUGUST 13, 2007
OR EARLIER IF REDEMPTION OR EXCHANGE
OCCURS. THE RIGHTS ARE SUBJECT TO
REDEMPTION AT $0.001 PER RIGHT AND TO
EXCHANGE ON THE TERMS SET FORTH IN THE
RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES, RIGHTS THAT ARE OR
WERE BENEFICIALLY OWNED BY AN ACQUIRING
PERSON OR ANY ASSOCIATES OR AFFILIATES
THEREOF (AS SUCH TERMS ARE DEFINED IN
THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT
HOLDER OF SUCH RIGHTS MAY BECOME NULL
AND VOID.
Right Certificate
ABIOMED, 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 August 13, 1997 (the "Rights Agreement"), between
ABIOMED, Inc., a Delaware corporation (the "Company"), and
BankBoston, N.A., a national banking association (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., Boston, Massachusetts time, on August 13,
2007, at the
principal office of the Rights Agent, or at the office of its
successor as Rights Agent, one one-thousandth of a fully paid non
assessable share of Series A Junior Participating Preferred Stock,
par value $.01 per share (the "Preferred Shares"), of the Company,
at a purchase price of $90.00 per one one-thousandth of a Preferred
Share (the "Purchase Price"), upon presentation and surrender of
this Right Certificate with the certification and the Form of
Election to
Purchase duly executed. The number of Right
<PAGE>
evidenced by this Right Certificate (and the number of one one
thousandths of a Preferred Share which may be purchased upon
exercise hereof) set forth above, and the Purchase Price set forth
above, are the number and Purchase Price as of August 13, 1997,
based on the Preferred Shares as constituted at such date. As
provided in the Rights Agreement, the Purchase Price and the number
of one onethousandths of a Preferred Share which may be purchased
upon the exercise of the Rights evidenced by this Right Certificate
are subject to modification and adjustment upon the happening of
certain events. From and after the occurrence of an event described
in Section 11(a)(ii) of the Rights Agreement, if the Rights
evidenced by this Right Certificate are or were at any time on or
after the earlier of (x) the Shares Acquisition Date (as such term
is defined in the Rights Agreement) and (y) the Distribution Date
(as such term is defined in the Rights Agreement) acquired or
beneficially owned by an Acquiring Person or an Associate or
Affiliate of an Acquiring Person (as such terms are defined in the
Rights Agreement), such Rights shall become void, and any holder of
such Rights shall thereafter have no right to exercise such Rights.
This Right Certificate is subject to all of the terms, provisions
and conditions of the Rights Agreement, which terms, provisions
and conditions are hereby incorporated herein by reference and made
a part hereof and to which Rights Agreement reference is hereby made
for a full description of the rights, limitations of rights,
obligations, duties and immunities hereunder of the Rights Agent,
the Company and the holders of the Right Certificates. Copies of
the Rights Agreement are on file at the principal executive offices
of the Company and the offices of the Rights Agent.
This Right Certificate, with or without other Right
Certificates, upon surrender at the principal office of the Rights
Agent, may be exchanged for another Right Certificate or Right
Certificates of like tenor and date evidencing Rights entitling the
holder to purchase a like aggregate number of Preferred Shares as
the Rights evidenced by the Right Certificate or Right Certificates
surrendered shall have entitled such holder to purchase. If this
Right Certificate shall be exercised in part, the holder shall be
entitled to receive upon surrender hereof another Right Certificate
or Right Certificates for the number of whole Rights not exercised
<PAGE>
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 $0.001 per Right or (ii) may be exchanged in
whole or in part for Preferred Shares or shares of the Company's
Common Stock, par value $0.01 per share.
No fractional Preferred Shares will be issued upon the exercise of
any Right or Rights evidenced hereby (other than fractions which are
integral multiples of one one-thousandth of a Preferred Share, which
may, at the election of the Company, be evidenced by depositary
receipts), but in lieu thereof a cash payment will be made, as
provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the
Preferred Shares or of any other securities of the Company which may
at any time be issuable on the exercise hereof, nor shall anything
contained in the Rights Agreement or herein be construed to confer
upon the holder hereof, as such, any of the rights of a stockholder
of the Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof, or
to give or withhold consent to any corporate action, or to receive
notice of meetings or other actions affecting stockholders (except
as provided in the Rights Agreement), or to receive dividends or
subscription rights, or otherwise, until the Right or Rights
evidenced
by this Right Certificate shall have been exercised as provided in
the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
<PAGE>
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal. Dated as of ,
_____.
Attest: ABIOMED, INC.
______ By:
Countersigned:
_
Rights Agent
By:__ ____
Authorized Signature
<PAGE>
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR VALUE RECEIVED
hereby sells, assigns and transfers unto
(Please print name and address of transferee)
this Right Certificate, together with all right, title and interest
therein, and does hereby irrevocably constitute and appoint
, Attorney, to transfer the within Right
Certificate on the books of the within-named Company, with full
power of substitution.
Dated: , ____
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or
trust company having an office or correspondent in the United
States.
The undersigned hereby certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by an Acquiring
Person or an Affiliate or Associate thereof (as defined in
the Rights Agreement).
Signature
<PAGE>
Form of Reverse Side of Right Certificate -- continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise the Right Certificate.)
To: ABIOMED, INC.:
The undersigned hereby irrevocably elects to exercise
Rights represented by this Right Certificate to
purchase the
Preferred Shares issuable upon the exercise of such Rights and
requests that certificates for such Preferred Shares be issued
in the name of:
Please insert social security
or other identifying number
(Please print name and address)
If such number of Rights shall not be all the Rights evidenced
by this Right Certificate, a new Right Certificate for the
balance remaining of such Rights shall be registered in the
name of and delivered to:
Please insert social security
or other identifying number
(Please print name and address)
Dated: , ____
Signature
<PAGE>
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or
trust company having an office or correspondent in the United
States.
The undersigned hereby certifies that the Rights evidenced by
this Right Certificate are not beneficially owned by an Acquiring
Person or an Affiliate or Associate thereof (as defined in the
Rights Agreement).
Signature
NOTICE
The signature in the foregoing Forms of Assignment and
Election must conform to the name as written upon the face of
this Right Certificate in every particular, without alteration or
enlargement or any change whatsoever.
In the event the certification set forth above in the Form of
Assignment or the Form of Election to Purchase, as the case may
be, is not completed, the Company and the Rights Agent will deem
the beneficial owner of the Rights evidenced by this Right
Certificate
to be an Acquiring Person or an Affiliate or Associate thereof
(as defined in the Rights Agreement) and such Assignment or
Election to Purchase will not be honored.
<PAGE>
Exhibit C
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES
On August 13, 1997, the Board of Directors of ABIOMED, Inc. (the
"Company") declared a dividend of one preferred share purchase
right (a "Right") for each outstanding share of common
stock, par value $0.01 per share (the "Common Shares") on August
28, 1997 (the "Record Date") to the stockholders of record on
that date. Each Right entitles the registered holder to purchase
from the Company one one-thousandth of a share of Series A Junior
Participating Preferred Stock, par value $0.01 per share (the
"Preferred Shares"), of the Company, at a price of $90.00 per one
one-thousandth of a Preferred Share (the "Purchase Price"),
subject to adjustment. The description and terms of the Rights
are set forth in a Rights Agreement (the "Rights Agreement")
between the Company and BankBoston, N.A., as Rights Agent (the
"Rights Agent").
Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated
persons (an "Acquiring Person") has acquired beneficial ownership
of 15% or more of the outstanding Common Shares, or (ii) 10
business days (or such later date as may be determined by action
of the Board of Directors prior to such time as any Person
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 15% 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 certificate with a copy of this Summary of
Rights attached thereto.
The 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 or upon transfer or new issuance of Common Shares wil
<PAGE>
contain a notation incorporating the Agreement by reference.
Until the Distribution Date (or earlier redemption or expiration
of the Rights), the surrender for transfer of any certificates
for Common Shares outstanding as of the Record Date, even without
such notation or a copy of this Summary of Rights being attached
thereto, will also constitute the transfer of the Rights
associated with the Common Shares represented by such
certificate. As soon as practicable following the Distribution
Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Common
Shares as of the Close of Business on the Distribution Date and
such separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on August 13, 2007 (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 number of outstanding Rights and the number of one one
thousandths 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, consolidations or
combinations of the Common Shares occurring, in any such
case, prior to the Distribution Date.
<PAGE>
Preferred Shares purchasable upon exercise of the Rights will not
be redeemable. Each Preferred Share will be entitled to a
quarterly dividend payment of 1000 times the dividend declared per
Common Share. In the event of liquidation, the holders of the
Preferred Shares will be entitled to an aggregate payment of 1000
times the aggregate payment made per Common Share. Each Preferred
Share will have 1000 votes, voting together with the Common
Shares. In the event of any merger, consolidation or other
transaction in which Common Shares are exchanged, each Preferred
Share will be entitled to receive 1000 times the amount received
per Common Share. These rights are protected by customary
antidilution provisions. Because of the nature of the Preferred
Shares' dividend,
liquidation and voting rights, the value of the one one-thousandth
interest in a Preferred Share purchasable upon exercise of each
Right 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 and
its Affiliates and Associates (which will thereafter be void),
will thereafter 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. In the event that, at any time after
a Person becomes an Acquiring Person, the Company is acquired in a
merger or other business combination transaction or 50% or more of
its consolidated assets or earning power are sold, proper
provision will be made so that each holder of a Right 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. If the Company does not have
sufficient Common Shares to
satisfy such obligation to issue Common Shares, or if the Board of
Directors so elects, the Company shall deliver upon payment of the
exercise price of a Right an amount of cash or securities
equivalent in value to the Common Shares issuable upon exercise of
a Right; provided that, if the Company fails to meet such
obligation within 30 days following the later of (x) the first
occurrence of an event triggering the right to purchase Common
Shares and (y) the date on
<PAGE>
which the Company's right to redeem the Rights expires, the
Company
must deliver, upon exercise of a Right but without requiring
payment of the exercise price then in effect, Common Shares (to
the extent available) and cash equal in value to the difference
between the value of the Common Shares otherwise issuable upon
the exercise of a Right and the exercise price then in effect.
The Board of Directors may extend the 30-day period described
above for up to an additional 60 days to permit the taking of
action that may be necessary to authorize sufficient additional
Common Shares to permit the issuance of Common Shares upon the
exercise in full of the Rights.
At any time after any Person becomes an Acquiring Person and
prior to the acquisition by any person or group of a majority 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 per Right (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 one one-thousandth of a Preferred Share,
which may, at the election of the Company, be evidenced by
depositary receipts) and in lieu thereof, an adjustment in cash
will be made based on the
market price of the Preferred Shares on the last trading day
prior to the date of exercise.
At any time prior to the time any Person becomes an Acquiring
Person, the Board of Directors of the Company may redeem the
Rights in whole, but not in part, at a price of $0.001 per Right
(the "Redemption Price"). The redemption of the Rights may be
made effective at such time, on such basis and with such
conditions as the Board of Directors in its sole discretion may
establish. Immediately upon any redemption of the Rights, the
right to exercise the Rights will terminate and the only right of
the holders
of Rights will be to receive the Redemption Price.
The terms of the Rights may be amended by the Board of
Directors of the Company without the consent of the holders of th
<PAGE>
Rights, except that from and after such time as any person
becomes an Acquiring Person no such amendment may adversely
affect the interests of the holders of the Rights (other than the
Acquiring Person and its Affiliates and Associates).
Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, including,
without limitation, the right to vote or to receive dividends.
A copy of the 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 Agreement, which is hereby incorporated herein by reference.
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<PAGE>
ABIOMED ADOPTS SHAREHOLDER PURCHASE
RIGHTS PLAN
Danvers, MA, August 14, 1997 -- ABIOMED, Inc.
(pronounced "AB-EE-O-MED"), (NASDAQ:ABMD) today
announced that its Board of Directors has adopted a
shareholder purchase Rights Plan and has declared a
distribution of preferred purchase Rights to shareholders of
record at the close of business on August 28, 1997. The
Rights will initially trade with the Company's Common Stock
and separate Rights Certificates will not be issued.
The Rights Plan is designed to deter coercive or unfair
takeover tactics and to ensure that all ABIOMED shareholders
receive fair and equal treatment in the event of an unsolicited
attempt to acquire the Corporation. The Rights Plan was not
adopted in response to any effort to acquire ABIOMED, and
the Board is not aware of any such effort.
Based in Danvers, Massachusetts, ABIOMED, Inc.
develops, manufacturers and markets innovative
cardiovascular, medical and dental products and is a leader in
the research and development of advanced artificial heart
systems.
