FORM 8-A
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
AAON, INC.
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(Exact name of registrant as specified in its charter)
COMMISSION FILE NO. 000-18953
Nevada 87-0448736
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(State of incorporation) (IRS Employer Identification No.)
2425 South Yukon, Tulsa, Oklahoma 74107
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(Address of principal executive offices) (Zip Code)
Securities to be registered pursuant to
Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
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None None
If this Form relates to the registration of a class of debt securities
and is effective upon filing pursuant to General Instruction A.(c)(1), please
check the following box. _
If this Form relates to the registration of a class of debt securities
and is to become effective simultaneously with the effectiveness of a concurrent
registration statement under the Securities Act of 1933 pursuant to General
Instruction A.(c)(2), please check the following box. _
Securities to be registered pursuant to
Section 12(g) of the Act:
Rights to Purchase
Series A Preferred Stock
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(Title of class)
<PAGE>
Item 1. Description of Securities To Be Registered
On February 18, 1999, the Board of Directors of AAON, Inc. (the
"Company") authorized and declared, effective February 19, 1999, a dividend
distribution of one Right for each outstanding share of the Company's common
stock, $.004 par value (the "Common Stock"), to stockholders of record at the
close of business on March 1, 1999. Each Right entitles the registered holder to
purchase from the Company one one-thousandth (1/1,000) of a share of Series A
Preferred Stock, par value $.001 per share (the "Preferred Stock"), at a
Purchase Price of $60.00 per one one-thousandth (1/1,000) of a share, subject to
adjustment. The description and terms of the Rights are set forth in a Rights
Agreement (the "Rights Agreement") between the Company and Progressive Transfer
Company, as Rights Agent (the "Rights Agent").
Initially, the Rights will be attached to all Common Stock certificates
representing shares then outstanding, and no separate Rights Certificates will
be distributed. The Rights will separate from the Common Stock upon the earlier
of (i) ten (10) business days following a public announcement that a person
(other than Norman H. Asbjornson, the Company's Chief Executive Officer) or
group of affiliated or associated persons (an "Acquiring Person") has acquired,
or obtained the right to acquire, beneficial ownership of twenty percent (20%)
or more of the outstanding shares of Common Stock (the "Stock Acquisition
Date"), or (ii) ten (10) business days (or such later date as the Board of
Directors shall determine) following the commencement of a tender or exchange
offer that would result in a person or group beneficially owning twenty percent
(20%) or more of such outstanding shares of Common Stock. The date the Rights
separate is referred to as the "Distribution Date."
Until the Distribution Date, (i) the Rights will be evidenced by the
Common Stock certificates and will be transferred with and only with such Common
Stock certificates, (ii) new Common Stock certificates issued after March 1,
1999 will contain a notation incorporating the Rights Agreement by reference,
and (iii) the surrender for transfer of any certificates for Common Stock
outstanding will also constitute the transfer of the Rights associated with the
Common Stock represented by such certificates. Pursuant to the Rights Agreement,
the Company reserves the right to require prior to the occurrence of a
Triggering Event (as defined below) that, upon any exercise of Rights, a number
of Rights be exercised so that only whole shares of Preferred Stock will be
issued.
The Rights are not exercisable until the Distribution Date and will
expire at the close of business on March 1, 2009, unless earlier redeemed by the
Company as described below.
As soon as practicable after the Distribution Date, Rights Certificates
will be mailed to holders of record of the Common Stock as of the close of
business on the Distribution Date and, thereafter, the separate Rights
Certificates will represent the Rights. Except in connection with shares of
Common Stock issued or sold pursuant to the exercise of stock options under any
employee plan or arrangements, or upon the exercise, conversion or exchange of
securities hereafter issued by the Company, or as otherwise determined by the
Board of Directors, only shares of Common Stock issued prior to the Distribution
Date will be issued with Rights.
In the event that (i) the Company is the surviving corporation in a
merger or other business combination with an Acquiring Person (or any associate
or affiliate thereof) and its Common Stock remains outstanding and unchanged,
(ii) any person shall acquire beneficial ownership of more than twenty percent
(20%) of the outstanding shares of Common Stock (except pursuant to (A) certain
consolidations or mergers involving the Company or sales or transfers of the
combined assets, cash flow or earning power of the Company and its subsidiaries
or (B) an offer for all outstanding shares of Common Stock at a price and upon
terms and conditions which the Board of Directors determines to be in the best
interests of the Company and its stockholders), or (iii) there occurs a
reclassification of securities, a recapitalization of the Company or any of
certain business combinations or other transactions (other than certain
consolidations and mergers involving the Company and sales or transfers of the
combined assets, cash flow or earning power of the Company and its subsidiaries)
involving the Company or any of its subsidiaries which has the effect of
increasing by more than one percent (1%) the proportionate share of any class of
the outstanding equity securities of the Company or any of its subsidiaries
beneficially owned by an Acquiring Person (or any associate or affiliate
thereof), each holder of a Right (other than the Acquiring Person and certain
related parties) will thereafter have the right to receive, upon exercise,
Common Stock (or, in certain circumstances, cash, property or other securities
of the Company) having a value equal to two times the Purchase Price of the
Right. Notwithstanding any of the foregoing, following the occurrence of any of
the events described in this paragraph, all Rights that are, or (under certain
circumstances specified in the Rights Agreement) were, beneficially owned by any
Acquiring Person will be null and void. The events described in this paragraph
are referred to as "Flip-in Events."
For example, at a Purchase Price of $60.00 per Right, each Right not
owned by an Acquiring Person (or by certain related parties or transferees)
following an event set forth in the preceding paragraph would entitle its holder
to purchase $120.00 worth of Common Stock (or other consideration, as noted
above) for $60.00. Assuming that the Common Stock had a per share market price
of $10.00 at such time, the holder of each valid Right would be entitled to
purchase twelve shares of Common Stock for $60.00.
In the event that, at any time following the Stock Acquisition Date,
(i) the Company shall enter into a merger or other business combination
transaction in which the Company is not the surviving corporation, (ii) the
Company is the surviving corporation in a consolidation, merger or similar
transaction pursuant to which all or part of the outstanding shares of Common
Stock are changed into or exchanged for stock or other securities of any other
person or cash or any other property or (iii) more than 50% of the combined
assets, cash flow or earning power of the Company and its subsidiaries is sold
or transferred (in each case other than certain consolidations with, mergers
with and into, or sales of assets, cash flow or earning power by or to
subsidiaries of the Company as specified in the Rights Agreement), each holder
of a Right (except Rights which previously have been voided as set forth above)
shall thereafter have the right to receive, upon exercise, common stock of the
acquiring company having a value equal to two times the Purchase Price of the
Right. The events described in this paragraph are referred to as "Flip-over
Events." Flip-in Events and Flip-over Events are referred to collectively as
"Triggering Events."
The Purchase Price payable, the number and kind of shares covered by
each Right and the number of Rights outstanding are subject to adjustment from
time to time to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred Stock, (ii) if
holders of the Preferred Stock are granted certain rights, options or warrants
to subscribe for Preferred Stock or securities convertible into Preferred Stock
at less than the current market price of the Preferred Stock, or (iii) upon the
distribution to holders of the Preferred Stock of evidences of indebtedness,
cash (excluding regular quarterly cash dividends), assets (other than dividends
payable in Preferred Stock) or subscription rights or warrants (other than those
referred to in (ii) immediately above).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments amount to at least one percent (1%) of the
Purchase Price. No fractional shares of Preferred Stock are required to be
issued (other than fractions which are integral multiples of one one-thousandth
(1/1,000) of a share of Preferred Stock) and, in lieu thereof, the Company may
make an adjustment in cash based on the market price of the Preferred Stock on
the trading date immediately prior to the date of exercise.
At any time after any person or group becomes an Acquiring Person and
prior to the acquisition by such person or group of fifty percent (50%) or more
of the outstanding shares of Common Stock, the Board of Directors of the Company
may, without payment of the Purchase Price by the holder, exchange the Rights
(other than Rights owned by such person or group, which will become void), in
whole or in part, for shares of Common Stock at an exchange ratio of one-half
(1/2) the number of shares of Common Stock (or in certain circumstances
Preferred Stock) for which a Right is exercisable immediately prior to the time
of the Company's decision to exchange the Rights (subject to adjustment).
At any time until the Stock Acquisition Date, the Company may redeem
the Rights in whole, but not in part, at a price of $0.001 per Right (payable in
cash, shares of Common Stock or other consideration deemed appropriate by the
Board of Directors). Immediately upon the action of the Board of Directors
ordering redemption of the Rights, the Rights will terminate and the only right
of the holders of Rights will be to receive the $0.001 redemption price.
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. While the distribution of the Rights will not
be taxable to stockholders or to the Company, stockholders may, depending upon
the circumstances, recognize taxable income in the event that the Rights become
exercisable for Common Stock (or other consideration) of the Company or for
common stock of an acquiring company as set forth above or in the event that the
Rights are redeemed.
Other than those provisions relating to the principal economic terms of
the Rights, any of the provisions of the Rights Agreement may be amended by the
Board of Directors of the Company at any time during the period in which the
Rights are redeemable. At any time when the Rights are no longer redeemable, the
provisions of the Rights Agreement may be amended by the Board only if such
amendment does not adversely affect the interest of holders of Rights (excluding
the interest of any Acquiring Person); provided, however, that no amendment may
cause the Rights again to become redeemable.
A copy of the Rights Agreement specifying the terms of the Rights, the
form of Certificate of Designation, Preferences and Rights of Series A Preferred
Stock and the form of Rights Certificate are filed herewith as Exhibits and are
incorporated herein by reference. Copies of the Rights Agreement are also
available free of charge from the Rights Agent. The foregoing description of the
Rights does not purport to be complete and is qualified in its entirety by
reference to the Rights Agreement.
Item 2. Exhibits
1 Rights Agreement, dated as of February 19, 1999, by and between AAON, Inc.
and Progressive Transfer Company, as Rights
Agent, including exhibits thereto.
2 Form of Certificate of Designation, Preferences and Rights of Series A
Preferred Stock of AAON, Inc. (attached as Exhibit 1 to the Rights
Agreement filed as Exhibit 1 hereto).
3 Form of Rights Certificate (attached as Exhibit 2 to the Rights Agreement
filed as Exhibit 1 hereto).
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, as amended, the Registrant has duly caused this registration statement to
be signed on its behalf by the undersigned, thereunto duly authorized.
AAON, INC.
February 25, 1999 By /s/ Norman H. Asbjornson
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Norman H. Asbjornson
President and Treasurer
<PAGE>
Index to Exhibits
1 Rights Agreement, dated as of February 19, 1999, by and between AAON, Inc.
and Progressive Transfer Company, as Rights Agent, including exhibits
thereto.
2 Form of Certificate of Designation, Preferences and Rights of Series A
Preferred Stock of AAON, Inc. (attached as Exhibit 1 to the Rights
Agreement filed as Exhibit 1 hereto).
3 Form of Rights Certificate (attached as Exhibit 2 to the Rights Agreement
filed as Exhibit 1 hereto).
<PAGE>
AAON, INC.
and
PROGRESSIVE TRANSFER COMPANY
Rights Agent
Rights Agreement
Dated as of February 19, 1999
<PAGE>
TABLE OF CONTENTS
Section Page
Section 1. Certain Definitions 1
Section 2. Appointment of Rights Agent 7
Section 3. Issuance of Rights Certificates 7
(a) Distribution Date; Rights Certificates. 7
(b) Common Stock Certificates; Summary of Rights. 8
(c) Legend. 8
Section 4. Form of Rights Certificates 9
(a) Form; Date. 9
(b) Acquiring Person Legend. 9
Section 5. Countersignature and Registration 10
(a) Signatures. 10
(b) Registration and Transfer. 11
Section 6. Transfer, Split Up, Combination and Exchange of Rights
Certificates; Mutilated, Destroyed, Lost or Stolen
Rights Certificates 11
(a) Procedure. 11
(b) Issuance of New Rights Certificates. 11
Section 7. Exercise of Rights; Purchase Price; Expiration
Date of Rights 12
(a) Exercise. 12
(b) Purchase Price. 13
(c) Rights Agent Actions. 13
(d) Partial Exercise. 13
(e) Termination of Acquiring Person's Rights. 13
(f) Surrender of Rights Certificates; Identity of
Beneficial Owner. 14
Section 8. Cancellation and Destruction of Rights Certificates 14
Section 9. Reservation and Availability of Capital Stock 14
(a) Reservation of Capital Stock. 14
(b) Listing. 15
(c) Registration under the Act. 15
(d) Covenant Regarding Capital Stock. 16
(e) Transfer Taxes and Charges. 16
Section 10. Preferred Stock Record Date 16
Section 11. Adjustment of Purchase Price; Number and Kind
of Shares or Number of Rights 17
(a) Certain Adjustments. 17
(b) Purchase Price Adjustment -- Capital Stock. 21
(c) Purchase Price Adjustment -- Cash, Assets, etc. 21
(d) Current Market Price 22
(e) Purchase Price Adjustment Threshold. 23
(f) Equivalent Adjustments. 24
(g) Post-Adjustment Rights Issuances. 24
(h) Preferred Stock Anti-Dilution. 24
(i) Adjustment of Number of Rights. 24
(j) Rights Certificates. 25
(k) Adjustment Below Par Value. 25
(l) Adjustment Effective as of Future Date; Exercise. 25
(m) Tax Adjustments. 26
(n) Restriction on Certain Transactions. 26
(o) Restriction Against Diminishing Benefits of the Rights. 27
(p) Common Stock Adjustments. 27
Section 12. Certificate of Adjusted Purchase Price or Number of Shares 27
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power 28
(a) Flip-over Event. 28
(b) Principal Party. 29
(c) Supplemental Agreement. 29
(d) Exceptions. 30
Section 14. Fractional Rights and Fractional Shares 31
(a) Fractional Rights. 31
(b) Fractional Shares of Preferred Stock. 31
(c) Fractional Shares of Common Stock. 32
(d) Waiver of Fractional Rights and Shares. 32
Section 15. Rights of Action 32
Section 16. Agreement of Rights Holders 33
Section 17. Rights Certificate Holder Not Deemed a Stockholder 33
Section 18. Concerning the Rights Agent 34
(a) Compensation. 34
(b) Reliance. 34
Section 19. Merger or Consolidation or Change of Name of Rights Agent 34
(a) Successor. 34
(b) Prior Countersignatures. 35
Section 20. Duties of Rights Agent 35
(a) Legal Counsel. 35
(b) Certification by the Company. 35
(c) Liability for Negligence, etc. 35
(d) Statements of Fact or Recitals. 36
(e) Agreement; Adjustments. 36
(f) Further Assurances. 36
(g) Instructions. 36
(h) Dealing in Rights. 36
(i) Agents; Reasonable Care. 37
(j) Expenses; Repayment Assurances. 37
(k) Exercise of Rights; Consultation with Company. 37
(l) No Notice of Facts. 37
Section 21. Change of Rights Agent 37
Section 22. Issuance of New Rights Certificates 38
Section 23. Redemption and Termination 38
(a) Redemption. 38
(b) Effect of Redemption; Procedure. 39
Section 24. Exchange 39
(a) Right to Exchange 39
(b) Effect of Exchange; Procedure. 40
(c) Common Stock Equivalents 40
(d) Insufficient Common Stock 40
(e) Fractional Shares 40
Section 25. Notice of Certain Events 41
(a) Preferred Stock Transactions, etc. 41
(b) Other Transactions. 42
Section 26. Notices 42
Section 27. Supplements and Amendments 42
Section 28. Successors 43
Section 29. Determinations and Actions by the Board of Directors, etc 43
Section 30. Benefits of this Agreement 44
Section 31. Severability 44
Section 32. Governing Law 44
Section 33. Counterparts 44
Section 34. Descriptive Headings 44
Exhibit 1 Certificate of Designation, Preferences and Rights
of Series A Preferred Stock 46
Exhibit 2 Form of Rights Certificate 55
Exhibit 3 Letter to Stockholders 62
Exhibit 4 Press Release 67
<PAGE 1>
RIGHTS AGREEMENT
RIGHTS AGREEMENT, dated as of February 19, 1999, between AAON, INC., a
Nevada corporation (the "Company"), and PROGRESSIVE TRANSFER COMPANY (the
"Rights Agent").
RECITAL
On February 18, 1999, the Board of Directors of the Company authorized
and declared, effective February 19, 1999 (the "Rights Dividend Declaration
Date"), a dividend distribution of one Right for each share of Common Stock (as
hereinafter defined) of the Company outstanding at the close of business on
March 1, 1999 (the "Record Date"), and has authorized the issuance of one Right
(as such number may hereafter be adjusted as provided herein) for each share of
Common Stock of the Company issued between the Record Date (whether originally
issued or delivered from the Company's treasury) and the Distribution Date, each
Right initially representing the right to purchase one one-thousandth of a share
of Series A Preferred Stock of the Company having the rights, powers and
preferences set forth in the form of Certificate of Designation, Preferences and
Rights attached hereto as Exhibit 1, upon the terms and subject to the
conditions hereinafter set forth (the "Rights");
AGREEMENT
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:
(a) "Acquiring Person" shall mean any Person who or which, together with
all Affiliates and Associates of such Person, shall be the Beneficial Owner (as
such term is hereinafter defined) of 20% or more of the shares of Common Stock
then outstanding, but shall not include (i) the Company, (ii) any Subsidiary of
the Company, (iii) any employee benefit plan of the Company or of any Subsidiary
of the Company, or any Person or entity organized, appointed or established by
the Company for or pursuant to the terms of any such plan, (iv) any Exempt
Person, (v) any Person who is an Acquiring Person on the first date of public
announcement of the adoption of this Agreement, unless and until such Person
shall purchase or otherwise become (as a result of actions taken by such Person
or its Affiliates or Associates) the Beneficial Owner of any additional shares
of Common Stock, or (vi) any Person who becomes an Acquiring Person solely as a
result of a reduction in the number of shares of Common Stock outstanding due to
the repurchase of shares of Common Stock by the Company, unless and until such
Person shall purchase or otherwise become (as a result of actions taken by such
Person or its Affiliates or Associates) the Beneficial Owner of additional
shares of Common Stock constituting 1% or more of the then outstanding shares of
Common Stock; provided, however, that if a Person shall become the Beneficial
Owner of 20% or more of the Common Stock of the Company then outstanding by
reason of share repurchases by the Company and shall, after such share
repurchases by the Company, become the Beneficial Owner of any additional Common
Stock of the Company, then such Person shall be deemed to be an "Acquiring
Person," unless upon the consummation of the acquisition of such additional
shares of Common Stock such Person does not beneficially own 20% or more of the
shares of Common Stock then outstanding. Notwithstanding the foregoing, 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 (including, without
limitation, because (i) such Person was unaware that it beneficially owned a
percentage of Common Stock that would otherwise cause such Person to be an
Acquiring Person, or (ii) such Person was aware of the extent of its Beneficial
Ownership of Common Stock but had no actual knowledge of the consequences of
such Beneficial Ownership under this Agreement) and without any intention of
changing or influencing control of the Company, and such Person divests as
promptly as practicable a sufficient number of shares of Common Stock so that
such Person would no longer be an Acquiring Person as defined pursuant to the
foregoing provisions of this paragraph, then such Person shall not be deemed to
be or to have become an Acquiring Person for any purposes of this Agreement.
(b) "Act" shall mean the Securities Act of 1933, as amended and in effect
from time to time.
(c) "Adjustment Shares" shall have the meaning set forth in Section
11(a)(ii) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Certain Adjustments)
(d) "Affiliate" and "Associate" shall have the respective meanings ascribed
to such terms in Rule 12b-2 of the General Rules and Regulations under the
Exchange Act.
(e) "Agreement" shall mean this Rights Agreement as originally executed or
as it may from time to time be supplemented or amended pursuant to the
applicable provisions hereof.
(f) 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, directly or indirectly, has the right to acquire (whether
such right is exercisable immediately or only after the passage of
time) pursuant to any agreement, arrangement or understanding (whether
or not in writing) or upon the exercise of conversion rights, exchange
rights, rights, warrants or options, or otherwise; provided, however,
that a Person shall not, for purposes of this paragraph (i), be deemed
the "Beneficial Owner" of or to "beneficially own," (A) securities
tendered pursuant to a tender or exchange offer made by such Person or
any of such Person's Affiliates or Associates until such tendered
securities are accepted for purchase or exchange, or (B) securities
issuable upon exercise of Rights at any time prior to the occurrence
of a Triggering Event, or (C) securities issuable upon exercise of
Rights from and after the occurrence of a Triggering Event, which
Rights were acquired by such Person or any of such Person's Affiliates
or Associates prior to the Distribution Date or pursuant to Section
3(a) (Issuance of Rights Certificates -- Distribution Date; Rights
Certificates) or Section 22 (Issuance of New Rights Certificates) (the
"Original Rights") or pursuant to Section 11(i) (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights --
Adjustment of Number of Rights) in connection with an adjustment made
with respect to any Original Rights;
(ii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to vote or dispose
of or has "beneficial ownership" of (as determined pursuant to Rule
13d-3 of the General Rules and Regulations under the Exchange Act),
including pursuant to any agreement, arrangement or understanding,
whether or not in writing; provided, however, that a Person shall not
be deemed the "Beneficial Owner" of, or to "beneficially own," any
security under this subparagraph (ii) as a result of an agreement,
arrangement or understanding to vote such security if such agreement,
arrangement or understanding: (A) arises solely from a revocable proxy
given in response to a public proxy or consent solicitation made
pursuant to, and in accordance with, the applicable provisions of the
General Rules and Regulations under the Exchange Act, and (B) is not
also then reportable by such Person on a 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 (or any Affiliate or Associate thereof) with which
such Person (or any of such Person's Affiliates or Associates) has any
agreement, arrangement or understanding (whether or not in writing),
for the purpose of acquiring, holding, voting (except pursuant to a
revocable proxy as described in the proviso to subparagraph (ii) of
this paragraph (f)) or disposing of any voting securities of the
Company;
provided, however, that nothing in this paragraph (f) shall cause a Person
engaged in business as an underwriter of securities to be the "Beneficial Owner"
of or to "beneficially own," any securities acquired through such Person's
participation in good faith in a firm commitment underwriting until the
expiration of forty (40) calendar days after the date of such acquisition.
(g) "Board" means the Board of Directors of the Company.
(h) "Business Day" shall mean any day other than a Saturday, Sunday or a
day on which banking institutions in the State of Oklahoma are authorized or
obligated by law or executive order to close.
(i) "Close of Business" on any given date shall mean 5:00 P.M., Tulsa,
Oklahoma time, on such date; provided, however, that if such date is not a
Business Day it shall mean 5:00 P.M., Tulsa, Oklahoma time, on the next
succeeding Business Day.
(j) "Common Stock" shall mean the common stock, par value $.004 per share,
of the Company, except that "Common Stock" when used with reference to any
Person other than the Company shall mean the capital stock of such Person with
the greatest voting power, or the equity securities or other equity interest
having power to control or direct the management, of such Person.
(k) "Common Stock Equivalents" shall have the meaning set forth in Section
11(a)(iii) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Certain Adjustments).
(l) "Company" shall mean the Person named as the "Company" in the first
paragraph of this Agreement until a successor corporation shall have become
such, or until a Principal Party shall assume, and thereafter be liable for, all
obligations and duties of the Company hereunder, pursuant to the applicable
provisions of this Agreement, and thereafter "Company" shall mean such successor
corporation or Principal Party.
(m) "Current Market Price" shall have the meaning set forth in Section
11(d) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Current Market Price).
(n) "Current Value" shall have the meaning set forth in Section 11(a)(iii)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of Rights --
Certain Adjustments).
(o) "Distribution Date" shall have the meaning set forth in Section 3(a)
(Issuance of Rights Certificates -- Distribution Date; Rights Certificates).
(p) "Equivalent Preferred Stock" shall have the meaning set forth in
Section 11(b) (Adjustment of Purchase Price; Number and Kind of Shares or Number
of Rights -- Purchase Price Adjustment -- Capital Stock).
(q) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended and in effect on the date of this Agreement.
(r) "Exchange Number" shall mean one-half of the number of shares of Common
Stock, one-thousandths of a share of Preferred Stock, or shares or other units
of other property for which a Right is exercisable immediately prior to the time
of the action of the Board to exchange the Rights.
(s) "Exempt Person" shall mean Norman H. Asbjornson or his Affiliates.
(t) "Expiration Date" shall have the meaning set forth in Section 7(a)
(Exercise of Rights; Purchase Price; Expiration Date of Rights -- Exercise).
(u) "Final Expiration Date" shall mean the Close of Business on March 1,
2009.
(v) "Flip-in Event" shall mean any event described in Section 11(a)(ii) (A)
or (B) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Certain Adjustments).
(w) "Flip-in Trigger Date" shall have the meaning set forth in Section
11(a)(iii) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Certain Adjustments).
(x) "Flip-over Event" shall mean any event described in clauses (x), (y) or
(z) of Section 13(a) (Consolidation, Merger or Sale or Transfer of Assets or
Earning Power -- Flip-over Event).
(y) "Original Rights" shall have the meaning set forth in Section 1(f)(i)
(Certain Definitions).
(z) "Person" shall mean any individual, firm, corporation, partnership or
other entity.
(aa) "Preferred Stock" shall mean shares of Preferred Stock, Series A, par
value $.001, of the Company, and, to the extent that there is not a sufficient
number of shares of Series A Preferred Stock authorized to permit the full
exercise of the Rights, any other series of Preferred Stock, par value $.001, of
the Company designated for such purpose containing terms substantially similar
to the terms of the Series A Preferred Stock.
(bb) "Principal Party" shall have the meaning set forth in Section 13(b)
(Consolidation, Merger or Sale or Transfer of Assets or Earning Power --
Principal Party).
(cc) "Purchase Price" shall have the meaning set forth in Section 4(a)
(Form of Rights Certificates -- Form; Date).
(dd) "Record Date" shall have the meaning set forth in the Recital at the
beginning of the Agreement.
(ee) "Redemption Date" shall have the meaning set forth in Section 23(a)
(Redemption and Termination -- Redemption).
(ff) "Redemption Price" shall have the meaning set forth in Section 23(a)
(Redemption and Termination -- Redemption).
(gg) "Rights" shall have the meaning set forth in the Recital at the
beginning of the Agreement.
(hh) "Rights Agent" shall mean the Person named as the "Rights Agent" in
the first paragraph of this Agreement until a successor Rights Agent shall have
become such pursuant to the applicable provisions hereof and thereafter "Rights
Agent" shall mean such successor Rights Agent. If at any time there is more than
one Person appointed by the Company as Rights Agent pursuant to the applicable
provisions of this Agreement, "Rights Agent" shall mean and include each such
Person.
(ii) "Rights Certificates" shall have the meaning set forth in Section 3(a)
(Issuance of Rights Certificates -- Distribution Date; Rights Certificates).
(jj) "Rights Dividend Declaration Date" shall have the meaning set forth in
the Recital at the beginning of the Agreement.
(kk) "Spread" shall have the meaning set forth in Section 11(a)(iii)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of Rights --
Certain Adjustments).
(ll) "Stock Acquisition Date" shall mean the first date of public
announcement (which, for purposes of this definition, shall include, without
limitation, a report filed or amended pursuant to Section 13(d) under the
Exchange Act) by the Company or an Acquiring Person that an Acquiring Person has
become such.
(mm) "Subsidiary" shall mean, with reference to any Person, any corporation
or other entity of which a majority of the voting power of equity securities or
majority of the equity interest is beneficially owned, directly or indirectly,
by such Person, or otherwise controlled by such Person.
(nn) "Substitution Period" shall have the meaning set forth in Section
11(a)(iii) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Certain Adjustments).
(oo) "Trading Day" shall have the meaning set forth in Section 11(d)(i)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of Rights --
Current Market Price).
(pp) "Triggering Event" shall mean any Flip-in Event or any Flip-over
Event.
<PAGE 7>
Section 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such Co-Rights Agents as it may deem
necessary or desirable.
Section 3. Issuance of Rights Certificates.
(a) Distribution Date; Rights Certificates. Until the earlier of (i) the
Close of Business on the tenth Business Day after the Stock Acquisition Date
(or, if the tenth Business Day after the Stock Acquisition Date occurs before
the Record Date, the Close of Business on the Record Date), or (ii) the Close of
Business on the tenth Business Day (or such later date as the Board shall
determine prior to such time as any Person becomes an Acquiring Person) after
the date that a tender or exchange offer 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 Person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan) is
first published or sent or given within the meaning of Rule 14d-2(a) of the
General Rules and Regulations under the Exchange Act, if upon consummation
thereof such Person would be the Beneficial Owner of 20% or more of the shares
of Common Stock then outstanding (the earlier of (i) and (ii) being herein
referred to as the "Distribution Date"), (x) the Rights will be evidenced
(subject to the provisions of paragraph (b) of this Section 3) by the
certificates for the Common Stock registered in the names of the holders of the
Common Stock (which certificates for Common Stock shall be deemed also to be
certificates for Rights) and not by separate certificates, and (y) the Rights
will be transferable only in connection with the transfer of the underlying
shares of Common Stock (including a transfer to the Company, except pursuant to
the provision of Section 23 (Redemption and Termination)). As soon as
practicable after the Distribution Date, the Rights Agent will send by
first-class, insured, postage prepaid mail, to each record holder of the Common
Stock as of the Close of Business on the Distribution Date, at the address of
such holder shown on the records of the Company, one or more rights
certificates, in substantially the form of Exhibit 2 hereto (the "Rights
Certificates"), evidencing one Right for each share of Common Stock so held,
subject to adjustment as provided herein. In the event that an adjustment in the
number of Rights per share of Common Stock has been made pursuant to Section
11(p) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Common Stock Adjustments) at the time of distribution of the Rights
Certificates, the Company shall make the necessary and appropriate rounding
adjustments (in accordance with Section 14(a) (Fractional Rights and Fractional
Shares -- Fractional Rights)) so that Rights Certificates representing only
whole numbers of Rights are distributed and cash is paid in lieu of any
fractional Rights. As of and after the Distribution Date, the Rights will be
evidenced solely by such Rights Certificates.
<PAGE 8>
(b) Common Stock Certificates; Summary of Rights. With respect to
certificates for the Common Stock outstanding as of the Record Date, until the
Distribution Date, the Rights associated with the Common Stock represented by
such certificates will be evidenced by such certificates alone and the
registered holders of such Common Stock shall also be the registered holders of
the associated Rights. Until the earlier of the Distribution Date or the
Expiration Date, the transfer of any certificates representing shares of Common
Stock in respect of which Rights have been issued shall also constitute the
transfer of the Rights associated with such shares of Common Stock. On the
Record Date, or as soon as practicable thereafter, the Company will send a copy
of a Summary of Rights to Purchase Preferred Stock, in substantially the form of
Exhibit 3 hereto (the "Summary of Rights"), by first-class, postage-prepaid
mail, to each record holder of shares of Common Stock as of the close of
business of the Record Date, at the address of such holder shown on the records
of the Company.
(c) Legend. Rights shall be issued in respect of all certificates for
shares of Common Stock which are issued (whether originally issued or from the
Company's treasury) after the Record Date but prior to the earliest of the (i)
Distribution Date, (ii) the Expiration Date, or (iii) the Redemption Date, or,
in certain circumstances provided in Section 22 (Issuance of New Rights
Certificates) after the Distribution Date. Certificates representing such shares
of Common Stock shall also be deemed to be certificates for Rights, and shall
bear the following legend:
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in the Rights Agreement dated as of
February 19, 1999, by and between AAON, Inc. (the "Company") and
Progressive Transfer Company, as Rights Agent (the "Rights
Agreement"), the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal offices of
the Company. 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. The Company will mail
to the holder of this certificate a copy of the Rights Agreement, as
in effect on the date of mailing, without charge promptly after
receipt of a written request therefor. Under certain circumstances set
forth in the Rights Agreement, Rights issued to, or held by, any
Person who is, was or becomes an Acquiring Person or any Affiliate or
Associate thereof (as such terms are defined in the Rights Agreement),
whether currently held by or on behalf of such Person or by any
subsequent holder, may become null and void.
With respect to such certificates containing the foregoing legend, until the
earliest of (i) the Distribution Date, (ii) the Expiration Date, and (iii) the
Redemption Date, (x) the Rights associated with the Common Stock represented by
such certificates shall be evidenced by such certificates alone, (y) the
registered holders of such Common Stock shall also be the registered holders of
the associated Rights, and (z) the transfer of any of such certificates shall
also constitute the transfer of the Rights associated with such shares of Common
Stock. In the event that the Company purchases, or acquires any shares of Common
Stock after the Record Date but prior to the Distribution Date, any rights
associated with such shares of Common Stock shall be deemed canceled and retired
so that the Company shall not be entitled to exercise any Rights associated with
shares of Common Stock which are no longer outstanding.
<PAGE 9>
Section 4. Form of Rights Certificates.
(a) Form; Date. The Rights Certificates (and the forms of election to
purchase and of assignment to be printed on the reverse thereof) shall each be
substantially in the form set forth in Exhibit 2 hereto and may have such marks
of identification or designation and such legends, summaries or endorsements
printed thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with any
rule or regulation of any stock exchange on which the Rights may from time to
time be listed or any securities association on whose interdealer quotation
system the Rights may be from time to time authorized for quotation, or to
conform to usage. Subject to the provisions of Section 11 (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights) and Section 22
(Issuance of New Rights Certificates), the Rights Certificates, whenever
distributed, shall be dated as of the Record Date and on their face shall
entitle the holders thereof to purchase such number of one one-thousandths of a
share of Preferred Stock as shall be set forth therein at the price set forth
therein (such exercise price per one one-thousandth of a share is referred to
herein as the "Purchase Price"), but the amount and type of securities
purchasable upon the exercise of each Right and the Purchase Price thereof shall
be subject to adjustment as provided herein.
(b) Acquiring Person Legend. Any Rights Certificate issued pursuant to
Section 3(a) (Issuance of Rights Certificates -- Distribution Date; Rights
Certificates) or Section 22 (Issuance of New Rights Certificates) that
represents Rights beneficially owned by (i) an Acquiring Person or any Associate
or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person
(or of any such Associate or Affiliate) who becomes a transferee after the
Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for consideration) from the
Acquiring Person to holders of equity interests in such Acquiring Person or to
any Person with whom such Acquiring Person has any continuing agreement,
arrangement or understanding regarding the transferred Rights or (B) a transfer
which is part of a plan, arrangement or understanding which has as a primary
purpose or effect avoidance of Section 7(e) (Exercise of Rights; Purchase Price;
Expiration Date of Rights -- Termination of Acquiring Person's Rights) and any
Rights Certificate issued pursuant to Section 6 (Transfer, Split Up, Combination
and Exchange of Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights
Certificates), Section 11 (Adjustment of Purchase Price; Number and Kind of
Shares or Number of Rights) or Section 22 (Issuance of New Rights Certificates)
upon transfer, exchange, replacement or adjustment of any other Rights
Certificate referred to in this sentence, shall contain (to the extent feasible)
the following legend:
The Rights represented by this Rights Certificate are or were
beneficially owned by a Person who was or became an Acquiring Person
or an Affiliate or Associate of an Acquiring Person (as such terms are
defined in the Rights Agreement dated as of February 19, 1999, by and
between AAON, Inc. and Progressive Transfer Company, as Rights Agent).
Accordingly, this Rights Certificate and the Rights represented hereby
may become null and void in the circumstances specified in Section
7(e) (Exercise of Rights; Purchase Price; Expiration Date of Rights --
Termination of Acquiring Person's Rights) of such Agreement.
<PAGE 10>
Section 5. Countersignature and Registration.
(a) Signatures. The Rights Certificates shall be executed on behalf of the
Company by its Chairman of the Board, its President or any Vice President,
either manually or by facsimile signature, and shall have affixed thereto the
Company's seal or a facsimile thereof which shall be attested to by the
Secretary or an Assistant Secretary of the Company, either manually or by
facsimile signature. The Rights Certificates shall be countersigned by the
Rights Agent, either manually or by facsimile signature, and shall not be valid
for any purpose unless so countersigned. In case any officer of the Company who
shall have signed any of the Rights Certificates shall cease to be such officer
of the Company before countersignature by the Rights Agent and issuance and
delivery by the Company, such Rights Certificates, nevertheless, may be
countersigned by the Rights Agent and issued and delivered by the Company with
the same force and effect as though the person who signed such Rights
Certificates had not ceased to be such officer of the Company; and any Rights
Certificates may be signed on behalf of the Company by any person who, at the
actual date of the execution of such Rights Certificate, shall be a proper
officer of the Company to sign such Rights Certificate, although at the date of
the execution of this Rights Agreement any such person was not such an officer.
<PAGE 11>
(b) Registration and Transfer. Following the Distribution Date, the Rights
Agent will keep or cause to be kept, at its principal office or offices
designated as the appropriate place for surrender of Rights Certificates upon
exercise or transfer, books for registration and transfer of the Rights
Certificates issued hereunder. Such books shall show the names and addresses of
the respective holders of the Rights Certificates, the number of Rights
evidenced on its face by each of the Rights Certificates and the date of each of
the Rights Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Rights
Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates.
(a) Procedure. Subject to the provisions of Section 4(b) (Form of Rights
Certificates -- Acquiring Person Legend), Section 7(e) (Exercise of Rights;
Purchase Price; Expiration Date of Rights -- Termination of Acquiring Person's
Rights) and Section 14 (Fractional Rights and Fractional Shares), at any time
after the Close of Business on the Distribution Date, and at or prior to the
Close of Business on the Expiration Date, any Rights Certificate or Certificates
may be transferred, split up, combined or exchanged for another Rights
Certificate or Certificates, entitling the registered holder to purchase a like
number of one one-thousandths of a share of Preferred Stock (or, following a
Triggering Event, Common Stock, other securities, cash or other assets, as the
case may be) as the Rights Certificate or Certificates surrendered then entitle
such holder (or former holder in the case of a transfer) to purchase. Any
registered holder desiring to transfer, split up, combine or exchange any Rights
Certificate or Certificates shall make such request in writing delivered to the
Rights Agent, and shall surrender the Rights Certificate or Certificates to be
transferred, split up, combined or exchanged at the principal office or offices
of the Rights Agent designated for such purpose. Neither the Rights Agent nor
the Company shall be obligated to take any action whatsoever with respect to the
transfer of any such surrendered Rights Certificate until the registered holder
shall have completed and signed the certificate contained in the form of
assignment on the reverse side of such Rights Certificate and shall have
provided such additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) or Affiliates or Associates thereof as the Company
shall reasonably request. Thereupon, the Rights Agent shall, subject to Section
4(b), Section 7(e) and Section 14, countersign and deliver to the Person
entitled thereto a Rights Certificate or Rights Certificates, as the case may
be, as so requested. The Company may require payment of a sum sufficient to
cover any tax or governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Rights Certificates.
(b) Issuance of New Rights Certificates. Upon receipt by the Company and
the Rights Agent of evidence reasonably satisfactory to them of the loss, theft,
destruction or mutilation of a Rights Certificate, and, in case of loss, theft
or destruction, of indemnity or security reasonably satisfactory to them, and
reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender to the Rights Agent and cancellation of
the Rights Certificate if mutilated, the Company will execute and deliver a new
Rights Certificate of like tenor to the Rights Agent for countersignature and
delivery to the registered owner in lieu of the Rights Certificate so lost,
stolen, destroyed or mutilated.
<PAGE 12>
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights.
(a) Exercise. Subject to Section 7(e) (Exercise of Rights; Purchase Price;
Expiration Date of Rights -- Termination of Acquiring Person's Rights), the
registered holder of any Rights Certificate may exercise the Rights evidenced
thereby (except as otherwise provided herein, including, without limitation, the
restrictions on exercisability set forth in Section 9(c) (Reservation and
Availability of Capital Stock -- Registration under the Act), Section 11(a)(iii)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of Rights --
Certain Adjustments), Section 23(a) (Redemption and Termination -- Redemption),
and Section 24(b) (Exchange -- Effect of Exchange; Procedure)) in whole or in
part at any time after the Distribution Date upon surrender of the Rights
Certificate, with the form of election to purchase and the certificate on the
reverse side thereof duly executed, to the Rights Agent at the principal office
or offices of the Rights Agent designated for such purpose, together with
payment of the aggregate Purchase Price with respect to the total number of one
one-thousandths of a share of Preferred Stock (or other securities, cash or
other assets, as the case may be) as to which such surrendered Rights are then
exercisable and an amount equal to any applicable transfer tax, at or prior to
the earliest of (i) the Final Expiration Date, (ii) the Redemption Date, or
(iii) the expiration of the Rights pursuant to Section 13(d) (Consolidation,
Merger or Sale or Transfer of Assets or Earning Power -- Exceptions) (the
earliest of (i), (ii) and (iii) being herein referred to as the "Expiration
Date"). The payment of the Purchase Price and the applicable transfer tax, if
any (as such amount may be reduced pursuant to Section 11(a)(iii) (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights -- Certain
Adjustments)), may be made (x) in cash, (y) by certified check, cashier's check
or money order payable to the order of the Company, or (z) by delivery of a
certificate or certificates (with appropriate stock powers executed in blank
attached thereto) evidencing a number of shares of Common Stock equal to the
then Purchase Price divided by the closing price (as determined pursuant to
Section 11(d) (Adjustment of Purchase Price; Number and Kind of Shares or Number
of Rights -- Current Market Price)) per share of Common Stock on the Trading Day
immediately preceding the date of such exercise. In the event that the Company
is obligated to issue other securities (including Common Stock) of the Company,
pay cash and/or distribute other property pursuant to Section 11(a) the Company
will make all arrangements necessary so that such other securities, cash and/or
other property are available for distribution by the Rights Agent, if and when
appropriate. The Company reserves the right to require prior to the occurrence
of a Triggering Event that upon any exercise of Rights, a number of Rights be
exercised so that only whole shares of Preferred Stock would be issued.
<PAGE 13>
(b) Purchase Price. The Purchase Price for each one one-thousandth of a
share of Preferred Stock pursuant to the exercise of a Right shall initially be
$60.00, and shall be subject to adjustment from time to time as provided in
Section 11 (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights) and Section 13(a) (Consolidation, Merger or Sale or Transfer of Assets
or Earning Power -- Flip-over Event) and shall be payable in accordance with
paragraph (a) of this Section 7.
(c) Rights Agent Actions. Upon receipt of a Rights Certificate representing
exercisable Rights and the compliance by the holder of such Rights Certificate
with paragraph (a) of this Section 7, the Rights Agent shall, subject to Section
20(k) (Duties of Rights Agent -- Exercise of Rights; Consultation with Company),
thereupon promptly (i) (A) requisition from any transfer agent of the shares of
Preferred Stock (or make available, if the Rights Agent is the transfer agent
for such shares) certificates for the total number of one one-thousandths of a
share of Preferred Stock to be purchased and the Company hereby irrevocably
authorizes its transfer agent to comply with all such requests, or (B) if the
Company shall have elected to deposit the total number of shares of Preferred
Stock issuable upon exercise of the Rights hereunder with a depositary agent,
requisition from the depositary agent depositary receipts representing such
number of one one-thousandths of a share of Preferred Stock as are to be
purchased (in which case certificates for the shares of Preferred Stock
represented by such receipts shall be deposited by the transfer agent with the
depositary agent) and the Company will direct the depositary agent to comply
with such request, (ii) requisition from the Company the amount of cash, if any,
to be paid in lieu of fractional shares in accordance with Section 14
(Fractional Rights and Fractional Shares), (iii) after receipt thereof, deliver
such certificates or depositary receipts to or upon the order of the registered
holder of such Rights Certificate, registered in such name or names as may be
designated by such holder, and (iv) after receipt thereof, deliver such cash, if
any, to or upon the order of the registered holder of such Rights Certificate.
(d) Partial Exercise. In case the registered holder of any Rights
Certificate shall exercise less than all the Rights evidenced thereby, a new
Rights Certificate evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent and delivered to, or upon the
order of the registered holder of such Rights Certificate, registered in such
name or names as may be designated by such holder, subject to the provisions of
Section 14 (Fractional Rights and Fractional Shares).
(e) Termination of Acquiring Person's Rights. Notwithstanding anything in
this Agreement to the contrary, from and after the first occurrence of a Flip-in
Event, any Rights beneficially owned by (i) an Acquiring Person, or an Associate
or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person
(or of any such Associate or Affiliate) who becomes a transferee after such
Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for consideration) from the
Acquiring Person to holders of equity interests in such Acquiring Person or to
any Person with whom the Acquiring Person has any continuing agreement,
arrangement or understanding regarding the transferred Rights or (B) a transfer
which is part of a plan, arrangement or understanding which has as a primary
purpose or effect the avoidance of this Section 7(e), shall become null and void
without any further action and no holder of such Rights shall have any rights
whatsoever with respect to such Rights, whether under any provision of this
Agreement or otherwise. The Company shall use all reasonable efforts to ensure
that the provisions of this Section 7(e) and Section 4(b) (Form of Rights
Certificates -- Acquiring Person Legend) are complied with, but shall have no
liability to any holder of Rights Certificates or other Person as a result of
its failure to make any determinations with respect to an Acquiring Person or
any of its respective Affiliates, Associates or transferees hereunder.
<PAGE 14>
(f) Surrender of Rights Certificates; Identity of Beneficial Owner.
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 contained in the form of election to purchase set forth
on the reverse side of the Rights Certificate surrendered for such exercise, and
(ii) provided such additional evidence of the identity of the Beneficial Owner
(or former Beneficial Owner) or Affiliates or Associates thereof as the Company
shall reasonably request.
Section 8. Cancellation and Destruction of Rights Certificates. All Rights
Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered to the Rights Agent, shall be canceled by it, and no Rights
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Agreement. The Company shall deliver to the Rights
Agent for cancellation and retirement, and the Rights Agent shall so cancel and
retire, any other Rights Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall deliver all
canceled Rights Certificates to the Company, or shall, at the written request of
the Company, destroy such canceled Rights Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Capital Stock.
(a) Reservation of Capital Stock. The Company will use its best efforts to
reserve and keep available out of its authorized and unissued shares of
Preferred Stock (and, following the occurrence of a Triggering Event, out of its
authorized and unissued shares of Common Stock and/or other securities or out of
its authorized and issued shares of Common Stock held in its treasury), the
number of shares of Preferred Stock (and, following the occurrence of a
Triggering Event, Common Stock and/or other securities) that, as provided in
this Agreement, including the rights of the Company under Section 11(a)(iii)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of Rights --
Certain Adjustments) to otherwise fulfill its obligations, will be sufficient to
permit the exercise in full of all outstanding Rights.
<PAGE 15>
(b) Listing. So long as the shares of Preferred Stock (and, following the
occurrence of a Triggering Event, Common Stock and/or other securities) issuable
and deliverable upon the exercise of the Rights may be listed on any national
securities exchange or authorized for quotation on any interdealer quotation
system of any securities association, the Company shall use its best efforts to
cause, from and after such time as the Rights become exercisable, all shares
reserved for such issuance to be listed on such exchange or quoted on such
system upon official notice of issuance upon such exercise.
(c) Registration under the Act. The Company will use its best efforts to
(i) file, as soon as practicable following the earliest date after the first
occurrence of a Flip-in Event on which the consideration to be delivered by the
Company upon exercise of the Rights has been determined in accordance with
Section 11(a)(iii) (Adjustment of Purchase Price; Number and Kind of Shares or
Number of Rights -- Certain Adjustments), or as soon as is required by law
following the Distribution Date, as the case may be, a registration statement on
an appropriate form under the Act with respect to the securities purchasable
upon exercise of the Rights, (ii) cause such registration statement to become
effective as soon as practicable after such filing, and (iii) cause such
registration statement to remain effective (with a prospectus at all times
meeting the requirements of the Act) until the earlier of (A) the date as of
which the Rights are no longer exercisable for such securities, and (B) the
Expiration Date. The Company will also take such action as may be appropriate
under, or to ensure compliance with, the securities or "blue sky" laws of the
various states in connection with the exercisability of the Rights. The Company
may temporarily suspend, for a period of time not to exceed ninety (90) calendar
days after the date set forth in clause (i) of the first sentence of this
Section 9(c), the exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective. Upon any such
suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as well as a public
announcement at such time as the suspension is no longer in effect. In addition,
if the Company shall determine that a registration statement is required
following the Distribution Date, the Company may temporarily suspend the
exercisability of the Rights until such time as a registration statement has
been declared effective. Notwithstanding any provision of this Agreement to the
contrary, the Rights shall not be exercisable in any jurisdiction if the
requisite qualification in such jurisdiction shall not have been obtained, the
exercise thereof shall not be permitted under applicable law or a registration
statement shall not have been declared effective.
<PAGE 16>
(d) Covenant Regarding Capital Stock. The Company will take all such action
as may be necessary to ensure that all one one-thousandths of a share of
Preferred Stock (and, following the occurrence of a Triggering Event, Common
Stock and/or other securities) delivered upon exercise of Rights shall, at the
time of delivery of the certificates for such shares (subject to payment of the
Purchase Price), be duly and validly authorized and issued and fully paid and
nonassessable.
(e) Transfer Taxes and Charges. The Company 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 Rights Certificates and of any
certificates for a number of one one-thousandths of a share of Preferred Stock
(or Common Stock and/or other securities, as the case may be) upon the exercise
of Rights. The Company shall not, however, be required to pay any transfer tax
which may be payable in respect of any transfer or delivery of Rights
Certificates to a Person other than, or the issuance or delivery of a number of
one one-thousandths of a share of Preferred Stock (or Common Stock and/or other
securities, as the case may be) in respect of a name other than, that of the
registered holder of the Rights Certificates evidencing Rights surrendered for
exercise or to issue or deliver any certificates for a number of one
one-thousandths of a share of Preferred Stock (or Common Stock and/or other
securities, as the case may be) in a name other than that of the registered
holder upon the exercise of any Rights until such tax shall have been paid (any
such tax being payable by the holder of such Rights Certificate at the time of
surrender) or until it has been established to the Company's satisfaction that
no such tax is due.
Section 10. Preferred Stock Record Date. Each Person in whose name any
certificate for a number of one one-thousandths of a share of Preferred Stock
(or Common Stock and/or other securities, as the case may be) is issued upon the
exercise of Rights shall for all purposes be deemed to have become the holder of
record of such fractional shares of Preferred Stock (or Common Stock and/or
other securities, as the case may be) represented thereby on, and such
certificate shall be dated as of, the date upon which the Rights Certificate
evidencing such Rights was duly surrendered and payment of the Purchase Price
(and all applicable transfer taxes) was made; provided, however, that if the
date of such surrender and payment is a date upon which the Preferred Stock (or
Common Stock and/or other securities, as the case may be) transfer books of the
Company are closed, such Person shall be deemed to have become the record holder
of such shares (fractional or otherwise) on, and such certificate shall be
dated, the next succeeding Business Day on which the Preferred Stock (or Common
Stock and/or other securities, as the case may be) transfer books of the Company
are open. Prior to the exercise of the Rights evidenced thereby, the holder of a
Rights Certificate shall not be entitled to any rights of a stockholder of the
Company with respect to shares for which the Rights shall be exercisable,
including, without limitation, the right to vote, to receive dividends or other
distributions or to exercise any preemptive rights, and shall not be entitled to
receive any notice of any proceedings of the Company, except as provided herein.
<PAGE 17>
Section 11. Adjustment of Purchase Price; Number and Kind of Shares or
Number of Rights. The Purchase Price, the number and kind of shares covered by
each Right and the number of Rights outstanding are subject to adjustment from
time to time as provided in this Section 11.
(a) Certain Adjustments.
(i) In the event the Company shall at any time after the date of
this Agreement (A) declare a dividend on the Preferred Stock payable
in shares of Preferred Stock, (B) subdivide or split the outstanding
Preferred Stock, (C) combine the outstanding Preferred Stock into a
smaller number of shares, or (D) issue any shares of its capital stock
in a reclassification of the Preferred Stock (including any such
reclassification in connection with a consolidation or merger in which
the Company is the continuing or surviving corporation), except as
otherwise provided in this Section 11(a) and Section 7(e) (Exercise of
Rights; Purchase Price; Expiration Date of Rights -- Termination of
Acquiring Person's Rights), the Purchase Price in effect at the time
of the record date for such dividend or of the effective date of such
subdivision, split, combination or reclassification, and the number
and kind of shares of Preferred Stock or capital stock, as the case
may be, issuable on such date, shall be proportionately adjusted so
that the holder of any Right exercised after such time shall be
entitled to receive, upon payment of the aggregate adjusted Purchase
Price then in effect necessary to exercise a Right in full, the
aggregate number and kind of shares of Preferred Stock or capital
stock, as the case may be, which, if such Right had been exercised
immediately prior to such date and at a time when the Preferred Stock
(or other capital stock, as the case may be) transfer books of the
Company were open, such holder would have owned upon such exercise and
been entitled to receive by virtue of such dividend, subdivision,
split, combination or reclassification. If an event occurs which would
require an adjustment under both this Section 11(a)(i) and Section
11(a)(ii) the adjustment provided for in this Section 11(a)(i) shall
be in addition to, and shall be made prior to, any adjustment required
pursuant to Section 11(a)(ii).
(ii) In the event:
(A) (1) any Acquiring Person or any Associate or Affiliate
of any Acquiring Person, at any time after the date of this
Agreement, directly or indirectly, shall merge into the Company
or otherwise combine with the Company and the Company shall be
the continuing or surviving corporation of such merger or
combination and the Common Stock of the Company shall remain
outstanding and unchanged, or (2) subject to Section 23
(Redemption and Termination), 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 Person or
entity organized, appointed or established by the Company for or
pursuant to the terms of any such plan), alone or together with
its Affiliates and Associates, shall, at any time after the
Rights Dividend Declaration Date, become an Acquiring Person,
unless the event causing such Person to become an Acquiring
Person is a Flip-over Event, or is an acquisition of shares of
Common Stock pursuant to a tender offer or an exchange offer for
all outstanding shares of Common Stock at a price and on terms
determined by the Board of Directors, prior to the public
announcement of such tender offer or exchange offer, after
receiving advice from one or more investment banking firms
selected by the Board of Directors, to be (a) at a price which is
fair to the stockholders of the Company (taking into account all
factors which the Board of Directors deem relevant including,
without limitation, prices which could reasonably be achieved if
the Company or its assets were sold on an orderly basis designed
to realize maximum value) and (b) otherwise in the best interests
of the Company and its stockholders, other than such Acquiring
Person, its Affiliates and its Associates; or
(B) during such time as there is an Acquiring Person, there
shall be any reclassification of securities (including any
reverse stock split), or recapitalization of the Company, or any
merger or consolidation of the Company with any of its
Subsidiaries or any other transaction or series of transactions
involving the Company or any of its Subsidiaries, other than a
transaction or transactions to which the provisions of Section
13(a) (Consolidation, Merger or Sale or Transfer of Assets or
Earning Power -- Flip-over Event) apply (whether or not with or
into or otherwise involving an Acquiring Person) which has the
effect, directly or indirectly, of increasing by more than 1% the
proportionate share of the outstanding shares of any class of
equity securities of the Company or any of its subsidiaries which
is directly or indirectly beneficially owned by any Acquiring
Person or any Associate or Affiliate of any Acquiring Person,
then, promptly following the occurrence of any such Flip-in Event
(whether described in Section 11(a)(ii)(A) or (B)), proper provision
shall be made so that each holder of a Right (except as provided below
and in Section 7(e) (Exercise of Rights; Purchase Price; Expiration
Date of Rights -- Termination of Acquiring Person's Rights)) shall
thereafter have the right to receive, upon exercise thereof at the then
current Purchase Price in accordance with the terms of this Agreement,
in lieu of the number of one one-thousandths of a share of Preferred
Stock, such number of shares of Common Stock of the Company as shall
equal the result obtained by (x) multiplying the then current Purchase
Price by the then number of one one-thousandths of a share of Preferred
Stock for which a Right was exercisable immediately prior to the first
occurrence of a Flip-in Event, and (y) dividing that product (which,
following such first occurrence, shall thereafter be referred to as the
"Purchase Price" for each Right and for all purposes of this Agreement)
by 50% of the Current Market Price per share of Common Stock on the
date of such first occurrence (such number of shares being referred to
as the "Adjustment Shares").
(iii) In the event that the number of shares of Common Stock
that are authorized by the Company's Articles of Incorporation
but not outstanding or reserved for issuance for purposes other
than upon exercise of the Rights is not sufficient to permit the
exercise in full of the Rights in accordance with the foregoing
subparagraph (ii) of this Section 11(a), the Company shall: (A)
determine the excess of (1) the value of the Adjustment Shares
issuable upon the exercise of a Right (the "Current Value") over
(2) the Purchase Price (such excess, the "Spread"), and (B) with
respect to each Right, subject to Section 7(e)(Exercise of
Rights; Purchase Price; Expiration Date of Rights -- Termination
of Acquiring Person's Rights), make adequate provision to
substitute for the Adjustment Shares, upon payment of the
applicable Purchase Price, (1) cash, (2) a reduction in the
Purchase Price, (3) Common Stock or other equity securities of
the Company (including, without limitation, shares, or units of
shares, of preferred stock which the Board has deemed to have
essentially the same value or economic rights as shares of Common
Stock (such shares of preferred stock being referred to as
"Common Stock Equivalents")), (4) debt securities of the Company,
(5) other assets, or (6) any combination of the foregoing, having
an aggregate value equal to the Current Value (less the amount of
any reduction in the Purchase Price), where such aggregate value
has been determined by the Board based upon the advice of a
nationally recognized investment banking firm selected by the
Board; provided, however, that if the Company shall not have made
adequate provision to deliver value pursuant to clause (B) above
within thirty (30) calendar days following the first occurrence
of a Flip-in Event (the date of such Flip-In Event being referred
to herein as the "Flip-in 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, shares
of Common Stock (to the extent available) and then, if necessary,
cash, which shares and/or cash have an aggregate value equal to
the Spread. If the Board shall determine in good faith that it is
likely that sufficient additional shares of Common Stock or other
equity securities could be authorized for issuance upon exercise
in full of the Rights, the thirty (30) calendar day period set
forth above may be extended to the extent necessary, but not more
than ninety (90) calendar days after the Flip-in Trigger Date, in
order that the Company may seek stockholder approval for the
authorization of such additional shares (such period, 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), 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 issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as
well as a public announcement at such time as the suspension is
no longer in effect. For purposes of this Section 11(a)(iii), the
value of the Common Stock shall be the Current Market Price per
share of the Common Stock on the Flip-in Trigger Date and the
value of any Common Stock Equivalent shall be deemed to have the
same value as the Common Stock on such date.
(iv) If the rules of the national securities exchange,
registered as such pursuant to Section 6 of the Exchange Act, or
of the national securities association, registered as such
pursuant to Section 15A of the Exchange Act, on which the Common
Stock is principally traded or quoted would prohibit such
exchange or association from listing or continuing to list, or
from authorizing for or continuing quotation and/or transaction
reporting through an inter-dealer quotation system, the Common
Stock or other equity securities of the Company if the Rights
were to be exercised for shares of Common Stock in accordance
with subparagraph (ii) of this Section 11(a) because such
issuance would nullify, restrict or disparately reduce the per
share voting rights of holders of Common Stock, the Company
shall: (A) determine the Spread, and (B) with respect to each
Right, make adequate provision to substitute for the Adjustment
Shares, upon payment of the applicable Purchase Price, (1) cash,
(2) a reduction in the Purchase Price, (3) equity securities of
the Company, including, without limitation, Common Stock
Equivalents, other than securities which would have the effect of
nullifying, restricting or disparately reducing the per share
voting rights of holders of Common Stock, (4) debt securities of
the Company, (5) other assets, or (6) any combination of the
foregoing, having an aggregate value equal to the Current Value,
where such aggregate value has been determined by the Board based
upon the advice of a recognized investment banking firm selected
by the Board; provided, however, if the Company shall not have
made adequate provision to deliver value pursuant to clause (B)
above within thirty (30) calendar days following the Flip-in
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, cash having an aggregate value
equal to the Spread. To the extent that the Company determines
that some action need be taken pursuant to the first sentence of
this Section 11(a)(iv), the Company (x) shall provide, subject to
Section 7(e) (Exercise of Rights; Purchase Price; Expiration Date
of Rights -- Termination of Acquiring Person's Rights), that such
action shall apply uniformly to all outstanding Rights and (y)
may suspend the exercisability of the Rights, but not longer than
ninety (90) calendar days after the Flip-in Trigger Date, in
order 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
issue a public announcement stating that the exercisability of
the Rights has been temporarily suspended, as well as a public
announcement at such time as the suspension is no longer in
effect. For purposes of this Section 11(a)(iv), the value of the
Common Stock shall be the Current Market Price per share of the
Common Stock on the Flip-in Trigger Date and the value of any
Common Stock Equivalent shall be deemed to have the same value as
the Common Stock on such date.
<PAGE 21>
(b) Purchase Price Adjustment -- Capital Stock. In case the Company shall
fix a record date for the issuance of rights, options or warrants to all holders
of Preferred Stock entitling them to subscribe for or purchase (for a period
expiring within forty-five (45) calendar days after such record date) Preferred
Stock (or shares having the same rights, privileges and preferences as the
shares of Preferred Stock ("Equivalent Preferred Stock")) or securities
convertible into Preferred Stock or Equivalent Preferred Stock at a price per
share of Preferred Stock or per share of Equivalent Preferred Stock (or having a
conversion price per share, if a security convertible into Preferred Stock or
Equivalent Preferred Stock) less than the Current Market Price per share of
Preferred Stock on such record date, the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of which
shall be the number of shares of Preferred Stock outstanding on such record
date, plus the number of shares of Preferred Stock which the aggregate offering
price of the total number of shares of Preferred Stock and/or Equivalent
Preferred Stock so to be offered (and/or the aggregate initial conversion price
of the convertible securities so to be offered) would purchase at such Current
Market Price, and the denominator of which shall be the number of shares of
Preferred Stock outstanding on such record date, plus the number of additional
shares of Preferred Stock and/or Equivalent Preferred Stock to be offered for
subscription or purchase (or into which the convertible securities so to be
offered are initially convertible). In case such subscription price may be paid
by delivery of consideration part or all of which may be in a form other than
cash, the value of such consideration shall be as determined in good faith by
the Board, whose determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent and the holders of the
Rights. Shares of Preferred Stock owned by or held for the account of the
Company shall not be deemed outstanding for the purpose of any such computation.
Such adjustment shall be made successively whenever such a record date is fixed,
and in the event that such rights or warrants are not so issued, the Purchase
Price shall be adjusted to be the Purchase Price which would then be in effect
if such record date had not been fixed.
(c) Purchase Price Adjustment -- Cash, Assets, etc. In case the Company
shall fix a record date for a distribution to all holders of Preferred Stock
(including any such distribution made in connection with a consolidation or
merger in which the Company is the continuing corporation) of evidences of
indebtedness, cash (other than a regular quarterly cash dividend out of the
earnings or retained earnings of the Company), assets (other than a dividend
payable in Preferred Stock, but including any dividend payable in stock other
than Preferred Stock) or subscription rights or warrants (excluding those
referred to in Section 11(b) (Adjustment of Purchase Price; Number and Kind of
Shares or Number of Rights Purchase Price Adjustment -- Capital Stock)), the
Purchase Price to be in effect after such record date shall be determined by
multiplying the Purchase Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the Current Market Price per
share of Preferred Stock on such record date, less the fair market value (as
determined in good faith by the Board, whose determination shall be described in
a statement filed with the Rights Agent) of the portion of the cash, assets or
evidences of indebtedness so to be distributed or of such subscription rights or
warrants applicable to a share of Preferred Stock and the denominator of which
shall be such Current Market Price per share of Preferred Stock. 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 be
adjusted to be the Purchase Price which would have been in effect if such record
date had not been fixed.
<PAGE 22>
(d) Current Market Price.
(i) For the purpose of any computation hereunder, other than
computations made pursuant to Section 11(a)(iii) (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights --
Certain Adjustments) the Current Market Price per share of Common
Stock on any date shall be deemed to be the average of the daily
closing prices per share of such Common Stock for the thirty (30)
consecutive Trading Days immediately prior to such date, and for
purposes of computations made pursuant to Section 11(a)(iii) the
Current Market Price per share of Common Stock on any date shall be
deemed to be the average of the daily closing prices per share of such
Common Stock for the ten (10) consecutive Trading Days immediately
following such date; provided, however, that in the event that the
Current Market Price per share of the Common Stock is determined
during a period following the announcement by the issuer of such
Common Stock of (A) a dividend or distribution on such Common Stock
payable in shares of such Common Stock or securities convertible into
shares of such Common Stock (other than the Rights), or (B) any
subdivision, combination or reclassification of such Common Stock and
the ex-dividend date for such dividend or distribution, or the record
date for such subdivision, combination or reclassification shall not
have occurred prior to the commencement of the requisite thirty (30)
Trading Day or ten (10) Trading Day period, as set forth above, then,
and in each such case, the Current Market Price shall be properly
adjusted to take into account ex-dividend trading. The closing price
for each Trading Day shall be the last sale price, regular way, or, in
case no such sale takes place on such Trading 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 shares of Common Stock 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 shares of Common Stock are listed or admitted to trading or,
if the shares of Common Stock 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 the National Association of
Securities Dealers, Inc. Automated Quotation System or such other
system then in use, or, if on any such date the shares of Common Stock
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 Common Stock selected by the Board. If on any
such date no market maker is making a market in the Common Stock, the
fair value of such shares on such date as determined in good faith by
the Board shall be used. The term "Trading Day" shall mean a day on
which the principal national securities exchange on which the shares
of Common Stock are listed or admitted to trading is open for the
transaction of business or, if the shares of Common Stock are not
listed or admitted to trading on any national securities exchange, a
Business Day. If the Common Stock is not publicly held or not so
listed or traded, Current Market Price per share shall mean the fair
value per share as determined in good faith by the Board, whose
determination shall be described in a statement filed with the Rights
Agent and shall be conclusive for all purposes.
(ii) For the purpose of any computation hereunder, the Current
Market Price per share of Preferred Stock shall be determined in the
same manner as set forth above for the Common Stock in clause (i) of
this Section 11(d) (other than the last sentence thereof). If the
Current Market Price per share of Preferred Stock cannot be determined
in the manner provided above or if the Preferred Stock is not publicly
held or listed or traded in a manner described in clause (i) of this
Section 11(d), the Current Market Price per share of Preferred Stock
shall be conclusively deemed to be an amount equal to 1,000 (as such
number may be appropriately adjusted for such events as stock splits,
stock dividends and recapitalizations with respect to the Common Stock
occurring after the date of this Agreement) multiplied by the Current
Market Price per share of the Common Stock. If neither the Common
Stock nor the Preferred Stock is publicly held or so listed or traded,
Current Market Price per share of the Preferred Stock shall mean the
fair value per share as determined in good faith by the Board, whose
determination shall be described in a statement filed with the Rights
Agent and shall be conclusive for all purposes. For all purposes of
this Agreement, the Current Market Price of one one-thousandth of a
share of Preferred Stock shall be equal to the Current Market Price of
one share of Preferred Stock divided by 1,000.
<PAGE 23>
(e) Purchase Price Adjustment Threshold. Anything herein to the contrary
notwithstanding, no adjustment in the Purchase Price shall be required unless
such adjustment would require an increase or decrease of at least one percent
(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 (Adjustment of Purchase Price; Number and Kind of Shares
or Number of Rights) shall be made to the nearest cent or to the nearest
thousandth of a share of Common Stock or other share or one-millionth of a share
of Preferred Stock, 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 the earlier of (i) three (3) years from the date of the transaction
which mandates such adjustment, or (ii) the Expiration Date.
<PAGE 24>
(f) Equivalent Adjustments. If as a result of an adjustment made pursuant
to Section 11(a)(ii) (Adjustment of Purchase Price; Number and Kind of Shares or
Number of Rights -- Certain Adjustments) or Section 13(a) (Consolidation Merger
or Sale or Transfer of Assets or Earning Power -- Flip-over Event) the holder of
any Right thereafter exercised shall become entitled to receive any shares of
capital stock other than Preferred Stock, thereafter the number of such other
shares so receivable upon exercise of any Right and the Purchase Price thereof
shall be subject to adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with respect to the Preferred
Stock contained in Sections 11(a), (b), (c), (e), (g), (h), (i), (j), (k) and
(m), and the provisions of Sections 7, 9, 10, 13 and 14 with respect to the
Preferred Stock shall apply on like terms to any such other shares.
(g) Post-Adjustment Rights Issuances. All Rights originally issued by the
Company subsequent to any adjustment made to the Purchase Price hereunder shall
evidence the right to purchase, at the adjusted Purchase Price, the number of
one one-thousandths of a share of Preferred Stock purchasable from time to time
hereunder upon exercise of the Rights, all subject to further adjustment as
provided herein.
(h) Preferred Stock Anti-Dilution. Unless the Company shall have exercised
its election as provided in Section 11(i) (Adjustment of Purchase Price; Number
and Kind of Shares or Number of Rights -- Adjustment of Number of Rights), upon
each adjustment of the Purchase Price as a result of the calculations made in
Section 11(b) (Adjustment of Purchase Price; Number and Kind of Shares or Number
of Rights -- Purchase Price Adjustment -- Capital Stock) and Section 11(c)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of Rights --
Purchase Price Adjustment -- Cash, Assets, etc.), each Right outstanding
immediately prior to the making of such adjustment shall thereafter evidence the
right to purchase, at the adjusted Purchase Price, that number of one
one-thousandths of a share of Preferred Stock (calculated to the nearest
one-millionth) obtained by (i) multiplying (x) the number of one one-thousandths
of a share covered by a Right immediately prior to 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) Adjustment of Number of Rights. The Company may elect on or after the
date of any adjustment of the Purchase Price to adjust the number of Rights, in
lieu of any adjustment in the number of one one-thousandths of a share of
Preferred Stock purchasable upon the exercise of a Right. Each of the Rights
outstanding after the adjustment in the number of Rights shall be exercisable
for the number of one one-thousandths of a share of Preferred Stock for which a
Right was exercisable immediately prior to such adjustment. Each Right held of
record prior to such adjustment of the number of Rights shall become that number
of Rights (calculated to the nearest one-ten-thousandth) obtained by dividing
the Purchase Price in effect immediately prior to adjustment of the Purchase
Price by the Purchase Price in effect immediately after adjustment of the
Purchase Price. The Company shall make a public announcement of its election to
adjust the number of Rights, indicating the record date for the adjustment, and,
if known at the time, the amount of the adjustment to be made. This record date
may be the date on which the Purchase Price is adjusted or any day thereafter,
but, if the Rights Certificates have been issued, shall be at least ten (10)
calendar days later than the date of the public announcement. If Rights
Certificates have been issued, upon each adjustment of the number of Rights
pursuant to this Section 11(i), the Company shall, as promptly as practicable,
cause to be distributed to holders of record of Rights Certificates on such
record date Rights Certificates evidencing, subject to Section 14 (Fractional
Rights and Fractional Shares) the additional Rights to which such holders shall
be entitled as a result of such adjustment, or, at the option of the Company,
shall cause to be distributed to such holders of record in substitution and
replacement for the Rights Certificates held by such holders prior to the date
of adjustment, and upon surrender thereof, if required by the Company, new
Rights Certificates evidencing all the Rights to which such holders shall be
entitled after such adjustment. Rights Certificates so to be distributed shall
be issued, executed and countersigned in the manner provided for herein (and may
bear, at the option of the Company, the adjusted Purchase Price) and shall be
registered in the names of the holders of record of Rights Certificates on the
record date specified in the public announcement.
<PAGE 25>
(j) Rights Certificates. Irrespective of any adjustment or change in the
Purchase Price or the number of one one-thousandths of a share of Preferred
Stock issuable upon the exercise of the Rights, the Rights Certificates
theretofore and thereafter issued may continue to express the Purchase Price per
one one-thousandth of a share and the number of one one-thousandths of a share
which were expressed in the initial Rights Certificates issued hereunder.
(k) Adjustment Below Par Value. Before taking any action that would cause
an adjustment reducing the Purchase Price below the then par or stated value, if
any, of the number of one one-thousandths of a share of Preferred Stock issuable
upon exercise of the Rights, the Company shall take any corporate action which
is or may, in the opinion of its counsel, be necessary in order that the Company
may validly and legally issue fully paid and nonassessable such number of one
one-thousandths of a share of Preferred Stock at such adjusted Purchase Price.
(l) Adjustment Effective as of Future Date; Exercise. In any case in which
this Section 11 (Adjustment of Purchase Price; Number and Kind of Shares or
Number of Rights) shall require that an adjustment in the Purchase Price be made
effective as of a record date for a specified event, the Company may elect to
defer until the occurrence of such event the issuance to the holder of any Right
exercised after such record date the number of one one-thousandths of a share of
Preferred Stock and other capital stock or securities of the Company, if any,
issuable upon such exercise over and above the number of one one-thousandths of
a share of Preferred Stock 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 (fractional or otherwise) or securities
upon the occurrence of the event requiring such adjustment.
<PAGE 26>
(m) Tax Adjustments. Anything in this Section 11 (Adjustment of Purchase
Price; Number and Kind of Shares or Number of Rights) 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 in its good faith judgment the Board shall
determine to be advisable in order that any (i) consolidation or subdivision of
the Preferred Stock, (ii) issuance wholly for cash of any shares of Preferred
Stock at less than the Current Market Price, (iii) issuance wholly for cash of
shares of Preferred Stock or securities which by their terms are convertible
into or exchangeable for shares of Preferred Stock, (iv) stock dividends or (v)
issuance of rights, options or warrants referred to in this Section 11,
hereafter made by the Company to holders of its Preferred Stock shall not be
taxable to such stockholders.
(n) Restriction on Certain Transactions. The Company shall not, at any time
after the earlier of the Stock Acquisition Date or the Distribution Date, (i)
consolidate with any other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) (Adjustment of Purchase Price;
Number and Kind of Shares or Number of Rights -- Restriction Against Diminishing
Benefits of the Rights)), (ii) merge with or into any other Person (other than a
Subsidiary of the Company in a transaction which complies with Section 11(o)),
(iii) enter into a statutory share exchange or similar transaction with any
other Person (other than a Subsidiary of the Company in a transaction which
complies with Section 11(o)), or (iv) sell or transfer (or permit any Subsidiary
to sell or transfer), in one transaction, or a series of related transactions,
assets, cash flow or earning power aggregating more than 50% of the assets, cash
flow or earning power of the Company and its Subsidiaries (taken as a whole) to
any other Person or Persons (other than the Company and/or any of its
Subsidiaries in one or more transactions each of which complies with Section
11(o)), if (x) at the time of or immediately after such consolidation, merger,
statutory share exchange or similar transaction, or sale there are any rights,
warrants or other instruments or securities outstanding or agreements in effect
which would substantially diminish or otherwise eliminate the benefits intended
to be afforded by the Rights or (y) prior to, simultaneously with or immediately
after such consolidation, merger, statutory share exchange or similar
transaction, or sale, the stockholders of the Person who constitutes, or would
constitute, the "Principal Party" for purposes of Section 13(a) (Consolidation,
Merger or Sale or Transfer of Assets or Earning Power -- Flip-over Event) shall
have received a distribution of Rights previously owned by such Person or any of
its Affiliates and Associates.
<PAGE 27>
(o) Restriction Against Diminishing Benefits of the Rights. The Company
covenants and agrees that, after the earlier of the Stock Acquisition Date or
the Distribution Date, it will not, except as permitted by Section 23
(Redemption and Termination) or Section 27 (Supplements and Amendments) take (or
permit any Subsidiary to take) any action if at the time such action is taken it
is reasonably foreseeable that such action will diminish substantially or
otherwise eliminate the benefits intended to be afforded by the Rights.
(p) Common Stock Adjustments. Anything in this Agreement to the contrary
notwithstanding, in the event that the Company shall at any time after the
Rights Dividend Declaration Date and prior to the Distribution Date (i) declare
a dividend on the outstanding shares of Common Stock payable in shares of Common
Stock, (ii) subdivide or split the outstanding shares of Common Stock, or (iii)
combine the outstanding shares of Common Stock into a smaller number of shares,
the number of Rights associated with each share of Common Stock then
outstanding, or issued or delivered thereafter but prior to the Distribution
Date, shall be proportionately adjusted so that the number of Rights thereafter
associated with each share of Common Stock following any such event shall equal
the result obtained by multiplying the number of Rights associated with each
share of Common Stock immediately prior to such event by a fraction, the
numerator of which shall be the total number of shares of Common Stock
outstanding immediately prior to the occurrence of the event and the denominator
of which shall be the total number of shares of Common Stock outstanding
immediately following the occurrence of such event. The adjustments provided for
in this Section 11(p) shall be made successively whenever such a dividend is
declared or paid or such subdivision, combination or consolidation is effected.
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Section 11 (Adjustment of Purchase
Price; Number and Kind of Shares or Number of Rights) and Section 13
(Consolidation, Merger or Sale or Transfer of Assets or Earning Power) the
Company shall (a) promptly prepare a certificate setting forth such adjustment
and a brief statement of the facts accounting for such adjustment, (b) promptly
file with the Rights Agent, and with each transfer agent for the Preferred Stock
and the Common Stock, a copy of such certificate, and (c) mail or cause the
Rights Agent to mail a brief summary thereof to each holder of a Rights
Certificate (or, if prior to the Distribution Date, to each holder of a
certificate representing shares of Common Stock) in accordance with Section 26
(Notices). The Rights Agent shall be fully protected in relying on any such
certificate and on any adjustment therein contained.
<PAGE 28>
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning
Power.
(a) Flip-over Event. In the event that, following the Stock Acquisition
Date, directly or indirectly, (x) the Company shall consolidate with, or merge
with and into, or enter into a statutory stock exchange or similar transaction
with, any other Person (other than a Subsidiary of the Company in a transaction
which complies with Section 11(o)(Adjustment of Purchase Price; Number and Kind
of Shares or Number of Rights -- Restriction Against Diminishing Benefits of the
Rights)), and the Company shall not be the continuing or surviving corporation
of such consolidation, merger or statutory share exchange or similar
transaction, (y) any Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o)) shall consolidate with, or merge
with or into, or enter into a statutory stock exchange or similar transaction
with, the Company, and the Company shall be the continuing or surviving
corporation of such consolidation, merger or statutory share exchange or similar
transaction and, in connection with such consolidation, merger or statutory
share exchange or similar transaction, all or part of the outstanding shares of
Common Stock shall be changed into or exchanged for stock or other securities of
any other Person or cash or any other property, or (z) the Company shall sell or
otherwise transfer (or one or more of its Subsidiaries shall sell or otherwise
transfer), in one transaction or a series of related transactions, assets, cash
flow or earning power aggregating more than 50% of the assets, cash flow or
earning power of the Company and its Subsidiaries (taken as a whole) to any
Person or Persons (other than the Company or any Subsidiary of the Company in
one or more transactions each of which complies with Section 11(o)), then, and
in each such case (except as may be contemplated by Section 13(d)
(Consolidation, Merger or Sale or Transfer of Assets or Earning Power --
Exceptions)), (i) proper provision shall be made so that: each holder of a
Right, except as provided in Section 7(e) (Exercise of Rights; Purchase Price;
Expiration Date of Rights -- Termination of Acquiring Person's Rights) shall
thereafter have the right to receive, upon the exercise thereof at the then
current Purchase Price in accordance with the terms of this Agreement, such
number of validly authorized and issued, fully paid, nonassessable and freely
tradeable shares of Common Stock of the Principal Party, not subject to any
liens, encumbrances, rights of first refusal or other adverse claims, as shall
be equal to the result obtained by (A) multiplying the then current Purchase
Price by the number of one one-thousandths of a share of Preferred Stock for
which a Right is exercisable immediately prior to the first occurrence of a
Flip-over Event (or, if a Flip-in Event has occurred prior to the first
occurrence of a Flip-over Event, multiplying the number of such one
one-thousandths of a share for which a Right was exercisable immediately prior
to the first occurrence of a Flip-in Event by the Purchase Price in effect
immediately prior to such first occurrence), and (B) dividing that product
(which, following the first occurrence of a Flip-over Event, shall be referred
to as the "Purchase Price" for each Right and for all purposes of this
Agreement) by 50% of the Current Market Price per share of the Common Stock of
such Principal Party on the date of consummation of such Flip-over Event; (ii)
such Principal Party shall thereafter be liable for, and shall assume, by virtue
of such Flip-over Event, all the obligations and duties of the Company pursuant
to this Agreement; (iii) the term "Company" shall thereafter be deemed to refer
to such Principal Party, it being specifically intended that the provisions of
Section 11 (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights) shall apply only to such Principal Party following the first occurrence
of a Flip- over Event; (iv) such Principal Party shall take such steps
(including, but not limited to, the reservation of a sufficient number of shares
of its Common Stock) in connection with the consummation of any such transaction
as may be necessary to assure that the provisions hereof shall thereafter be
applicable, as nearly as reasonably may be, in relation to its shares of Common
Stock thereafter deliverable upon the exercise of the Rights; and (v) the
provisions of Section 11(a)(ii) (Adjustment of Purchase Price; Number and Kind
of Shares or Number of Rights -- Certain Adjustments) hereof shall be of no
effect following the first occurrence of any Flip-over Event.
<PAGE 29>
(b) Principal Party. "Principal Party" shall mean
(i) in the case of any transaction described in clause (x) or (y)
of the first sentence of Section 13(a) (Consolidation, Merger or Sale
or Transfer of Assets or Earning Power -- Flip-over Event), the Person
that is the issuer of any securities into which shares of Common Stock
of the Company are converted in such consolidation, merger or
statutory share exchange or similar transaction, and if no securities
are so issued, the Person that is the other party to such
consolidation, merger or statutory share exchange or similar
transaction, and
(ii) in the case of any transaction described in clause (z) of
the first sentence of Section 13(a) (Consolidation, Merger or Sale or
Transfer of Assets or Earning Power -- Flip-over Event), the Person
that is the party receiving the greatest portion of the assets, cash
flow or earning power transferred pursuant to such transaction or
transactions;
provided, however, that in any such case, (1) if the Common Stock of such Person
is not at such time and has not been continuously over the preceding twelve (12)
month period registered under Section 12 of the Exchange Act, and such Person is
a direct or indirect Subsidiary of another Person the Common Stock of which is
and has been so registered, "Principal Party" shall refer to such other Person;
and (2) in case such Person is a Subsidiary, directly or indirectly, of more
than one Person, the Common Stocks of two or more of which are and have been so
registered, "Principal Party" shall refer to whichever of such Persons is the
issuer of the total outstanding Common Stock having the greatest aggregate
market value.
(c) Supplemental Agreement. The Company shall not consummate a Flip-over
Event unless the Principal Party shall have a sufficient number of authorized
shares of its Common Stock which have not been issued or reserved for issuance
to permit the exercise in full of the Rights in accordance with this Section 13
(Consolidation, Merger or Sale or Transfer of Assets or Earning Power) and
unless prior thereto the Company and such Principal Party shall have executed
and delivered to the Rights Agent a supplemental agreement providing for the
terms set forth in paragraphs (a) and (b) of this Section 13 and further
providing that, as soon as practicable after the date of such Flip-over Event,
the Principal Party will
(i) prepare and file a registration statement under the Act, with
respect to the Rights and the securities purchasable upon exercise of
the Rights on an appropriate form, and will use its best efforts to
cause such registration statement to (A) become effective as soon as
practicable after such filing and (B) remain effective (with a
prospectus at all times meeting the requirements of the Act) until the
Expiration Date and take all such other action as may be necessary to
enable the Principal Party to issue the securities purchasable upon
exercise of the Rights, including but not limited to the registration
or qualification of such securities under all requisite securities
laws or jurisdictions of the various states and the listing of such
securities on such exchange and trading markets as may be necessary or
appropriate; and
(ii) will deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which
comply in all respects with the requirements for registration on Form
10 under the Exchange Act.
The provisions of this Section 13 (Consolidation, Merger or Sale or Transfer of
Assets or Earning Power) shall similarly apply to successive consolidations,
mergers or statutory share exchanges or similar transactions or sales or other
transfers. In the event that a Flip-over Event shall occur at any time after the
occurrence of a Flip-in Event, the Rights which have not theretofore been
exercised shall thereafter become exercisable in the manner described in Section
13(a) (Consolidation, Merger or Sale or Transfer of Assets or Earning Power --
Flip-over Event).
<PAGE 30>
(d) Exceptions. Notwithstanding anything in this Agreement to the contrary,
Section 13 (Consolidation, Merger or Sale or Transfer of Assets or Earning
Power) shall not be applicable to a transaction described in subparagraphs (x)
and (y) of Section 13(a) (Consolidation, Merger or Sale or Transfer of Assets or
Earning Power -- Flip-over Event) if (i) such transaction is consummated with a
Person or Persons who acquired shares of Common Stock pursuant to a tender offer
or exchange offer for all outstanding shares of Common Stock which complies with
the provisions of Section 11(a)(ii)(A) (Adjustment of Purchase Price; Number and
Kind of Shares or Number of Rights -- Certain Adjustments) (or a wholly-owned
subsidiary of any such Person or Persons), (ii) the price per share of Common
Stock offered in such transaction is not less than the price per share of Common
Stock paid to all holders of shares of Common Stock whose shares were purchased
pursuant to such tender or exchange offer and (iii) the form of consideration
being offered in such transaction is the same as the form of consideration paid
to all holders of shares of Common Stock whose shares were purchased pursuant to
such tender offer or exchange offer. Upon consummation of any such transaction
contemplated by this Section 13(d), all Rights hereunder shall expire.
<PAGE 31>
Section 14. Fractional Rights and Fractional Shares.
(a) Fractional Rights. The Company shall not be required to issue fractions
of Rights, except prior to the Distribution Date as provided in Section 11(p)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of Rights --
Common Stock Adjustments), or to distribute Rights Certificates which evidence
fractional Rights. In lieu of such fractional Rights, there shall be paid to the
registered holders of the Rights Certificates with regard to which such
fractional Rights would otherwise be issuable, an amount in cash equal to the
same fraction of the current market value of a whole Right. For purposes of this
Section 14(a), the current market value of a whole Right shall be the closing
price of the Rights for the Trading Day immediately prior to the date on which
such fractional Rights would have been otherwise issuable. The closing price of
the Rights for any Trading Day shall be the last sale price, regular way, or, in
case no such sale takes place on such Trading 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 the National Association of Securities Dealers, Inc.
Automated Quotation System or such other system then in use or, if on any such
date the Rights are not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market maker making
a market in the Rights selected by the Board. 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 shall be used.
(b) Fractional Shares of Preferred Stock. The Company shall not be required
to issue fractions of shares of Preferred Stock (other than fractions which are
integral multiples of one one-thousandth of a share of Preferred Stock which may
at the option of the Company, be evidenced by depositary receipts) upon exercise
of the Rights or to distribute certificates which evidence fractional shares of
Preferred Stock (other than fractions which are integral multiples of one
one-thousandth of a share of Preferred Stock). Interests in fractions of
Preferred Stock in integral multiples of one one- thousandth of a share of
Preferred Stock may, at the election of the Company, be evidenced by depositary
receipts, pursuant to an appropriate agreement between the Company and a
depositary selected by it; provided, however, 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 Stock represented by such depositary receipts. In lieu of
fractional shares of Preferred Stock that are not integral multiples of one
one-thousandth of a share of Preferred Stock, the Company may pay to the
registered holders of Rights Certificates at the time such Rights are exercised
as herein provided an amount in cash equal to the same fraction of the current
market value of one one-thousandth of a share of Preferred Stock. For purposes
of this Section 14(b), the current market value of one one-thousandth of a share
of Preferred Stock shall be one one-thousandth of the closing price of a share
of Preferred Stock (as determined pursuant to Section 11(d)(ii) (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights -- Current Market
Price) for the Trading Day immediately prior to the date of such exercise.
<PAGE 32>
(c) Fractional Shares of Common Stock. Following the occurrence of a
Triggering Event, the Company shall not be required to issue fractions of shares
of Common Stock upon exercise of the Rights or to distribute certificates which
evidence fractional shares of Common Stock. In lieu of fractional shares of
Common Stock, the Company may pay to the registered holders of Rights
Certificates at the time such Rights are exercised as herein provided an amount
in cash equal to the same fraction of the current market value of one (1) share
of Common Stock. For purposes of this Section 14(c), the current market value of
one share of Common Stock shall be the closing price of one share of Common
Stock (as determined pursuant to Section 11(d)(i) (Adjustment of Purchase Price;
Number and Kind of Shares or Number of Rights -- Current Market Price) for the
Trading Day immediately prior to the date of such exercise.
(d) Waiver of Fractional Rights and Shares. The holder of a Right by the
acceptance of the Right expressly waives his or her right to receive any
fractional Rights or any fractional shares upon exercise of a Right, except as
permitted by this Section 14 (Fractional Rights and Fractional Shares).
Section 15. Rights of Action. All rights of action in respect of this
Agreement are vested in the respective registered holders of the Rights
Certificates (and, prior to the Distribution Date, the registered holders of the
Common Stock); and any registered holder of any Rights Certificate (or, prior to
the Distribution Date, of the Common Stock), without the consent of the Rights
Agent or of the holder of any other Rights Certificate (or, prior to the
Distribution Date, of the Common Stock), may, in his or her own behalf and for
his or her own benefit, enforce, and may institute and maintain any suit, action
or proceeding against the Company to enforce, or otherwise act in respect of,
his or her right to exercise the Rights evidenced by such Rights Certificate in
the manner provided in such Rights Certificate and in this Agreement. Without
limiting the foregoing or any remedies available to the holders of Rights, it is
specifically acknowledged that the holders of Rights would not have an adequate
remedy at law for any breach of this Agreement and shall be entitled to specific
performance of the obligations hereunder and injunctive relief against actual or
threatened violations of the obligations hereunder of any Person subject to this
Agreement.
<PAGE 33>
Section 16. Agreement of Rights Holders. Every holder of a Right by
accepting the same consents and agrees with the Company and the Rights Agent and
with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be transferable only in
connection with the transfer of Common Stock;
(b) after the Distribution Date, the Rights Certificates are transferable
only on the registry books of the Rights Agent if surrendered at the principal
office or offices of the Rights Agent designated for such purposes, duly
endorsed or accompanied by a proper instrument of transfer and with the
appropriate forms and certificates fully executed;
(c) subject to Section 6(a) (Transfer, Split Up, Combination and Exchange
of Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates
- -- Procedure) and Section 7(f) (Exercise of Rights; Purchase Price; Expiration
Date of Rights -- Surrender of Rights Certificates; Identity of Beneficial
Owner), the Company and the Rights Agent may deem and treat the person in whose
name a Rights Certificate (or, prior to the Distribution Date, the associated
Common Stock certificate) is registered as the absolute owner thereof and of the
Rights evidenced thereby (notwithstanding any notations of ownership or writing
on the Rights Certificates or the associated Common Stock certificate made by
anyone other than the Company or the Rights Agent) for all purposes whatsoever,
and neither the Company nor the Rights Agent, subject to the last sentence of
Section 7(e) (Exercise of Rights; Purchase Price; Expiration Date of Rights --
Termination of Acquiring Person's Rights), shall be required to be affected by
any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary, neither the
Company nor the Rights Agent shall have any liability to any holder of a Right
or other Person as a result of its inability to perform any of its obligations
under this Agreement by reason of any preliminary or permanent injunction or
other order, decree or ruling issued by a court of competent jurisdiction or by
a governmental, regulatory or administrative agency or commission, or any
statute, rule, regulation or executive order promulgated or enacted by any
governmental authority, prohibiting or otherwise restraining performance of such
obligation; provided, however, the Company must use its best efforts to have any
such order, decree or ruling lifted or otherwise overturned as soon as possible.
Section 17. Rights Certificate Holder Not Deemed a Stockholder. No holder,
as such, of any Rights Certificate shall be entitled to vote, receive dividends
or be deemed for any purpose the holder of the number of one one-thousandths of
a share of Preferred Stock or any other securities of the Company which may at
any time be issuable on the exercise of the Rights represented thereby, nor
shall anything contained herein or in any Rights Certificate be construed to
confer upon the holder of any Rights Certificate, as such, any of the rights of
a 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 (Notice
of Certain Events)), or to receive dividends or subscription rights, or
otherwise, until the Right or Rights evidenced by such Rights Certificate shall
have been exercised in accordance with the provisions hereof.
<PAGE 34>
Section 18. Concerning the Rights Agent.
(a) Compensation. The Company shall 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
agrees to indemnify the Rights Agent for, and to hold it harmless against, any
loss, liability or expense, incurred without gross negligence, bad faith or
willful misconduct on the part of the Rights Agent, for anything done or omitted
to be done by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the costs and expenses of defending
against or investigating any claim of liability in the premises.
(b) Reliance. The Rights Agent shall be protected and shall incur no
liability for or in respect of any action taken, suffered or omitted to be taken
by it in connection with its administration of this Agreement in reliance upon
any Rights Certificate or certificate for Common Stock or for other securities
of the Company, instrument of assignment or transfer, power of attorney,
endorsement, affidavit, letter, notice, direction, consent, certificate,
statement or other paper or document believed by it to be genuine and to be
signed, executed and, where necessary, verified or acknowledged, by the proper
Person or Persons, or otherwise upon the advice of counsel as set forth in
Section 20 (Duties of Rights Agent).
Section 19. Merger or Consolidation or Change of Name of Rights Agent.
(a) Successor. Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights Agent
or any successor Rights Agent shall be a party, or any corporation succeeding to
the corporate trust or stock transfer business of the Rights Agent or any
successor Rights Agent, shall be the successor to the Rights Agent under this
Agreement without the execution or filing of any paper or any further act on the
part of any of the parties hereto; provided, however, that such corporation
would be eligible for appointment as a successor Rights Agent under the
provisions of Section 21 (Change of Rights Agent). In case at the time such
successor Rights Agent shall succeed to the agency created by this Agreement,
any of the Rights Certificates shall have been countersigned but not delivered,
any such successor Rights Agent may adopt the countersignature of a predecessor
Rights Agent and deliver such Rights Certificates so countersigned; and in case
at that time any of the Rights Certificates shall not have been countersigned,
any successor Rights Agent may countersign such Rights Certificates either in
the name of the predecessor or in the name of the successor Rights Agent; and in
all such cases such Rights Certificates shall have the full force provided in
the Rights Certificates and in this Agreement.
<PAGE 35>
(b) Prior Countersignatures. In case at any time the name of the Rights
Agent shall be changed and at such time any of the Rights Certificates shall
have been countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Rights Certificates so
countersigned; and in case at that time any of the Rights Certificates shall not
have been countersigned, the Rights Agent may countersign such Rights
Certificates either in its prior name or in its changed name; and in all such
cases such Rights Certificates shall have the full force provided in the Rights
Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes the duties
and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the holders of Rights Certificates,
by their acceptance thereof, shall be bound:
(a) Legal Counsel. 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 to be taken by it in good faith and in accordance with such
opinion.
(b) Certification by the Company. Whenever in the performance of its duties
under this Agreement the Rights Agent shall deem it necessary or desirable that
any fact or matter (including, without limitation, the identity of any Acquiring
Person and the determination of Current Market Price) be proved or established
by the Company prior to taking or suffering any action hereunder, such fact or
matter (unless other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and established by a
certificate signed by the President, any Vice President, the Secretary, any
Assistant Secretary, the Treasurer or any Assistant Treasurer 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) Liability for Gross Negligence, etc. The Rights Agent shall be liable
hereunder only for its own gross negligence, bad faith or willful misconduct.
(d) Statements of Fact or Recitals. The Rights Agent shall not be liable
for or by reason of any of the statements of fact or recitals contained in this
Agreement or in the Rights Certificates or be required to verify the same
(except as to its countersignature on such Rights Certificates), but all such
statements and recitals are and shall be deemed to have been made by the Company
only.
(e) Agreement; Adjustments. The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or the execution and
delivery hereof (except the due execution hereof by the Rights Agent) or in
respect of the validity or execution of any Rights Certificate (except its
countersignature); nor shall it be responsible for any breach by the Company of
any covenant or condition contained in this Agreement or in any Rights
Certificate; nor shall it be responsible for any adjustment required under the
provisions of Section 11 (Adjustment of Purchase Price; Number and Kind of
Shares or Number of Rights) or Section 13 (Consolidation, Merger or Sale or
Transfer of Assets or Earning Power) or responsible for the manner, method or
amount of any such adjustment or the ascertaining of the existence of facts that
would require any such adjustment (except with respect to the exercise of Rights
evidenced by Rights Certificates after actual notice of any such adjustment);
nor shall it by any act hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any shares of Common Stock or
Preferred Stock to be issued pursuant to this Agreement or any Rights
Certificate or as to whether any shares of Common Stock or Preferred Stock will,
when so issued, be validly authorized and issued, fully paid and nonassessable.
(f) Further Assurances. The Company will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may reasonably be required
by the Rights Agent for the carrying out or performing by the Rights Agent of
the provisions of this Agreement.
(g) Instructions. The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties hereunder from
the President, any Vice President, the Secretary, any Assistant Secretary, the
Treasurer or any Assistant Treasurer of the Company and to apply to such persons
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 the instructions of any such person.
(h) Dealing in Rights. 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.
<PAGE 37>
(i) Agents; Reasonable Care. 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, however, reasonable care was
exercised in the selection and continued employment thereof.
(j) Expenses; Repayment Assurances. No provision of this Agreement shall
require the Rights Agent to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder or in the
exercise of its rights if there shall be reasonable grounds for believing that
repayment of such funds or adequate indemnification against such risk or
liability is not reasonably assured to it. The Rights Agent may, in its sole
discretion, before taking any action which would necessitate expending funds for
expenses that are reimbursable under this Agreement, require prepayment of such
expenses.
(k) Exercise of Rights; Consultation with Company. If, with respect to any
Rights Certificate surrendered to the Rights Agent for exercise or transfer, the
certificate attached to the form of assignment or form of election to purchase,
as the case may be, has either not been completed or indicates an affirmative
response to clause 1 and/or 2 thereof, the Rights Agent shall not take any
further action with respect to such requested exercise of transfer without first
consulting with the Company.
(l) No Notice of Facts. The Rights Agent shall not be required to take
notice or be deemed to have notice of any fact, event or determination
(including, without limitation, any dates or events defined in this Agreement or
the designation of any Person as an Acquiring Person, Affiliate or Associate)
under this Agreement unless and until the Rights Agent shall be specifically
notified in writing by the Company of such fact, event or determination.
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 thirty (30) calendar days' notice in writing mailed to the Company, and to
each transfer agent of the Common Stock and Preferred Stock, by registered or
certified mail, and to the holders of the Rights Certificates by first-class
mail. The Company may remove the Rights Agent or any successor Rights Agent upon
thirty (30) calendar days' notice in writing, mailed to the Rights Agent or
successor Rights Agent, as the case may be, and to each transfer agent of the
Common Stock and Preferred Stock, by registered or certified mail, and to the
holders of the Rights Certificates by first-class mail. If the Rights Agent
shall resign or be removed or shall otherwise become incapable of acting, the
Company shall appoint a successor to the Rights Agent. If the Company shall fail
to make such appointment within a period of thirty (30) calendar days after
giving notice of such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights Agent or by
the holder of a Rights Certificate (who shall, with such notice, submit his
Rights Certificate for inspection by the Company), then the registered holder of
any Rights Certificate may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor Rights Agent, whether appointed
by the Company or by such a court, shall be (a) a corporation organized and
doing business under the laws of the United States or of any State of the United
States, in good standing, which is authorized under such laws to exercise stock
transfer or corporate trust powers, is subject to supervision or examination by
federal or state authority and has at the time of its appointment as Rights
Agent a combined capital and surplus of at least $50,000,000 or (b) an Affiliate
of a corporation described in clause (a) of this sentence. After appointment,
the successor Rights Agent shall be vested with the same powers, rights, duties
and responsibilities as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall deliver and transfer
to the successor Rights Agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose. Not later than the effective date of any such appointment, the
Company shall file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common Stock and the Preferred Stock, and mail a
notice thereof in writing to the registered holders of the Rights Certificates.
Failure to give any notice provided for in this Section 21 (Change of Rights
Agent), 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.
<PAGE 38>
Section 22. Issuance of New Rights Certificates. Notwithstanding any of the
provisions of this Agreement or of the Rights to the contrary, the Company may,
at its option, issue new Rights Certificates evidencing Rights in such form as
may be approved by the Board 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 Rights Certificates made in accordance with the provisions
of this Agreement. In addition, in connection with the issuance or sale of
shares of Common Stock following the Distribution Date and prior to the
redemption or expiration of the Rights, the Company (a) shall, with respect to
shares of Common Stock so issued or sold pursuant to the exercise of stock
options or under any employee plan or arrangement, or upon the exercise,
conversion or exchange of securities hereafter issued by the Company, in either
case outstanding as of the Distribution Date, and (b) may, in any other case, if
deemed necessary or appropriate by the Board, issue Rights Certificates
representing the appropriate number of Rights in connection with such issuance
or sale; provided, however, that (i) no such Rights Certificate shall be issued
if, and to the extent that, the Company shall be advised by counsel that such
issuance would create a significant risk of material, adverse tax consequences
to the Company or the Person to whom such Rights Certificate would be issued,
and (ii) no such Rights Certificate shall be issued if, and to the extent that,
appropriate adjustment shall otherwise have been made in lieu of the issuance
thereof.
Section 23. Redemption and Termination.
(a) Redemption. The Company may, at its option, at any time prior to the
earlier of (i) the Stock Acquisition Date, or (ii) the Final Expiration Date,
redeem (the date of such redemption being referred to herein as the "Redemption
Date") all but not less than all of the then outstanding Rights at a redemption
price of $0.001 per Right, as such amount may be appropriately adjusted to
reflect any stock split, stock dividend or similar transaction occurring after
the date hereof (such redemption price being hereinafter referred to as the
"Redemption Price"). The redemption of the Rights by the Company may be made
effective at such time, on such basis and with such conditions as the Board in
its sole discretion, may establish. The Company may, at its option, pay the
Redemption Price in cash, shares of Common Stock (based on the Current Market
Price of the Common Stock at the time of redemption) or any other form of
consideration deemed appropriate by Board.
<PAGE 39>
(b) Effect of Redemption; Procedure. Immediately upon the action of the
Company ordering the redemption of the Rights and without any further action and
without any notice, the right to exercise the Rights will terminate and the only
right thereafter of the holders of Rights shall be to receive the Redemption
Price for each Right so held. Promptly after the Redemption Date, the Company
shall (i) give notice of such redemption to the Rights Agent, (ii) give public
notice of such redemption; provided, however, that the failure to give, or any
defect in, such notice shall not affect the validity of such redemption, and
(iii) mail notice of such redemption to 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 Stock. Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the holder receives the
notice. Each such notice of redemption will state the method by which the
payment of the Redemption Price will be made. Amounts payable shall be rounded
down to the nearest $0.01.
Section 24. Exchange.
(a) Right to Exchange. The Company may, at its option, at any time and from
time to time after the first occurrence of a Flip-in Event, exchange all or part
of the then outstanding and exercisable Rights (other than Rights which have
become void as provided in Section 7(e) (Exercise of Rights; Purchase Price;
Expiration Date of Rights -- Termination of Acquiring Person's Rights)) for the
Exchange Number of shares of Common Stock, shares or units of Preferred Stock
which the Board has determined to be a Common Stock Equivalent, units of other
property or any combination thereof as determined by the Board. Notwithstanding
the foregoing, the Company 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 shares of Common Stock for or pursuant to any such plan), together with
all Affiliates and Associates of such Person, becomes the Beneficial Owner of
50% or more of the shares of Common Stock then outstanding. The exchange of the
Rights by the Company may be made effective at such time, on such basis and with
such conditions as the Board in its sole discretion may establish.
<PAGE 40>
(b) Effect of Exchange; Procedure. Immediately upon the action of the
Company ordering the exchange of any Rights pursuant to paragraph (a) of this
Section 24, evidence of which shall have been filed with the Rights Agent and
without any further action and without any notice, the right to exercise such
Rights will terminate and the only right thereafter of a holder of such Rights
shall be to receive that number of shares of Common Stock, Common Stock
Equivalents or units of other property equal to the number of such Rights held
by such holder multiplied by the Exchange Number. Promptly after the action of
the Company ordering the exchange of the Rights, the Company shall (i) file
evidence of such action with the Rights Agent, (ii) give public notice of such
exchange; provided, however, that the failure to give, or any defect in, such
notice shall not affect the validity of such exchange, and (iii) mail notice of
such exchange to 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 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
as provided in Section 7(e) (Exercise of Rights; Purchase Price; Expiration Date
of Rights -- Termination of Acquiring Person's Rights)) held by each holder of
Rights.
(c) Common Stock Equivalents. In any exchange pursuant to this Section 24,
the Company, at its option, may substitute Common Stock Equivalents for Common
Stock exchangeable for Rights, at the initial rate of one share of Common Stock
Equivalent for each share of Common Stock, as appropriately adjusted to reflect
adjustments in the voting rights of the Common Stock pursuant to the Company's
Articles of Incorporation, so that the share of Common Stock Equivalent
delivered in lieu of each share of Common Stock shall have the same voting
rights as one share of Common Stock.
(d) Insufficient Common Stock. In the event that the number of shares of
Common Stock which are authorized by the Company's Articles of Incorporation but
not outstanding or reserved for issuance for purposes other than upon exercise
of the Rights is not sufficient to permit any exchange of Rights in accordance
with this Section 24, the Company may, at its option, take all such action as
may be necessary to authorize additional shares of Common Stock for issuance
upon such exchange.
(e) Fractional Shares. Upon the action of the Company ordering the exchange
of any Rights pursuant to paragraph (a) of this Section 24, the Company shall
not be required to issue fractions of shares or to distribute certificates which
evidence fractional shares. In lieu of such fractional shares, the Company may
pay to the registered holders of the Rights Certificates with regard to which
such fractional shares would otherwise be issuable an amount in cash equal to
the same fraction of the current market value of one share of Common Stock. For
purposes of this Section 24, the current market value of one share of Common
Stock shall be the closing price of one share of Common Stock (as determined
pursuant to Section 11(d)(i) (Adjustment of Purchase Price; Number and Kind of
Shares or Number of Rights -- Current Market Price)) for the Trading Day
immediately prior to the date of exchange pursuant to this Section 24, and the
value of any Common Stock Equivalent shall be deemed to have the same current
market value as the Common Stock on such date.
<PAGE 41>
Section 25. Notice of Certain Events.
(a) Preferred Stock Transactions, etc. In case the Company shall propose,
at any time after the Distribution Date, (i) to pay any dividend payable in
stock of any class to the holders of Preferred Stock or to make any other
distribution to the holders of Preferred Stock (other than a regular quarterly
cash dividend out of earnings or retained earnings of the Company); (ii) to
offer to the holders of Preferred Stock rights or warrants to subscribe for or
to purchase any additional shares of Preferred Stock or shares of stock of any
class or any other securities, rights or options; (iii) to effect any
reclassification of its Preferred Stock (other than a reclassification involving
only the subdivision of outstanding shares of Preferred Stock); (iv) to effect
any consolidation with, merger into or with, or statutory share exchange or
similar transaction with, any other Person (other than a Subsidiary of the
Company in a transaction which complies with Section 11(o) (Adjustment of
Purchase Price; Number and Kind of Shares or Number of Rights -- Restriction
against Diminishing Benefits of the Rights)), 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 transaction or a series of related transactions, of more
than 50% of the assets, cash flow or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person or Persons (other than the
Company and/or any of its Subsidiaries in one or more transactions each of which
complies with Section 11(o)); (v) to effect the liquidation, dissolution or
winding up of the Company, or (vi) to declare or pay any dividend on the shares
of Common Stock payable in Common Stock or to effect a subdivision, combination
or consolidation of the shares of Common Stock (by reclassification or otherwise
than by payment of dividends in Common Stock), then, in each such case, the
Company shall give to each holder of a Rights Certificate, to the extent
feasible and in accordance with Section 26 (Notices), a notice of such proposed
action, which shall specify the record date for the purposes of such stock
dividend, distribution of rights or warrants, or the date on which such
reclassification, consolidation, merger, statutory share exchange or similar
transaction, sale, transfer, liquidation, dissolution, or winding up is to take
place and the date of participation therein by the holders of the shares of
Preferred Stock, if any such date is to be fixed, and such notice shall be so
given in the case of any action covered by clause (i) or (ii) above at least
twenty (20) calendar days prior to the record date for determining holders of
the shares of Preferred Stock for purposes of such action, and in the case of
any such other action, at least twenty (20) calendar days prior to the date of
the taking of such proposed action or the date of participation therein by the
holders of the shares of Preferred Stock, whichever shall be the earlier.
<PAGE 42>
(b) Other Transactions. In case any of the events set forth in Section
11(a)(ii) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Certain Adjustments) shall occur, then, in any such case, (i) the
Company shall as soon as practicable thereafter give to each holder of a Rights
Certificate, to the extent feasible and in accordance with Section 26 (Notices),
a notice of the occurrence of such event, which shall specify the event and the
consequences of the event to holders of Rights under Section 11(a)(ii), and (ii)
all references in the preceding paragraph to Preferred Stock shall be deemed
thereafter to refer to Common Stock and/or, if appropriate, other securities.
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 Rights Certificate to
or on the Company shall be sufficiently given or made if sent by telecopier
(with receipt confirmed) or by first-class mail, postage prepaid, addressed
(until another address is filed in writing with the Rights Agent) as follows:
AAON, Inc.
2425 South Yukon
Tulsa, Oklahoma 74107
Attention: Chief Executive Officer
Telecopier: (918) 583-6094
Subject to the provisions of Section 21 (Change of Rights Agent), any notice or
demand authorized by this Agreement to be given or made by the Company or by the
holder of any Rights Certificate to or on the Rights Agent shall be sufficiently
given or made if sent by telecopier (with receipt confirmed) or by first-class
mail, postage prepaid, addressed (until another address is filed in writing with
the Company) as follows:
Progressive Transfer Company
1981 East Murray-Holladay Road
Suite 200
Salt Lake City, Utah
Attention: Kurtis D. Hughes
Telecopier: 801-277-3147
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Rights Certificate (or, if
prior to the Distribution Date, to the holder of certificates representing
shares of Common Stock) shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed to such holder at the address of
such holder as shown on the registry books of the Company.
Section 27. Supplements and Amendments. For so long as the Rights are
redeemable, and subject to the penultimate sentence of this Section 27, the
Company may, and the Rights Agent shall, if the Company so directs, supplement
or amend any provision of this Agreement without the approval of any holders of
certificates representing shares of Common Stock or, on and after the
Distribution Date, any holders of Rights Certificates. At any time when the
Rights are no longer redeemable and subject to the penultimate sentence of this
Section 27, the Company and the Rights Agent shall, if the Company so directs,
supplement or amend this Agreement without the approval of any holders of Rights
Certificates; provided, however, that no such supplement or amendment may (i)
adversely affect the interests of the holders of Rights Certificates, or, prior
to the Distribution Date, the holders of the Common Stock (other than an
Acquiring Person or an Affiliate or Associate of any such Person), (ii) cause
this Agreement again to become amendable other than in accordance with this
sentence, or (iii) cause the Rights again to become redeemable. Upon the
delivery of a certificate from an appropriate officer of the Company which
states that the proposed supplement or amendment is in compliance with the terms
of this Section 27, the Rights Agent shall execute such supplement or amendment.
Notwithstanding anything contained in this Agreement to the contrary, no
supplement or amendment shall be made which changes the Redemption Price, the
Final Expiration Date, the Purchase Price, or the number of one one-thousandths
of a share of Preferred Stock for which a right is exercisable; provided,
however, that at any time prior to (i) a Stock Acquisition Date or (ii) the date
that a tender or exchange offer by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the Company or any
Subsidiary of the Company, or any Person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan) is
first published or sent or given within the meaning of Rule 14d-2(a) of the
General Rules and Regulations under the Exchange Act, if upon consummation
thereof, such Person would be the Beneficial Owner of 20% or more of the shares
of Common Stock then outstanding, the Board may amend this Agreement to increase
the Purchase Price or extend the Final Expiration Date. Prior to the
Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Common Stock.
<PAGE 43>
Section 28. Successors. All the covenants and provisions of this Agreement
by or for the benefit of the Company or the Rights Agent shall bind and inure to
the benefit of their respective successors and assigns hereunder.
Section 29. Determinations and Actions by the Board of Directors, etc. For
all purposes of this Agreement, any calculation of the number of shares of
Common Stock outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding shares of Common Stock
of which any Person is the Beneficial Owner, shall be made in accordance with
the last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations
under the Exchange Act. The Board shall have the exclusive power and authority
to administer this Agreement and to exercise all rights and powers specifically
granted to the Board or to the Company, or as may be necessary or advisable in
the administration of this Agreement, including, without limitation, the right
and power to (i) interpret the provisions of this Agreement, and (ii) make all
determinations deemed necessary or advisable for the administration of this
Agreement (including a determination to redeem or not redeem the Rights or to
amend the Agreement). All such actions, calculations, interpretations and
determinations (including, for purposes of clause (y) below, all omissions with
respect to the foregoing) which are done or made by the Board, in good faith,
shall (x) be final, conclusive and binding on the Company, the Rights Agent, the
holders of the Rights and all other parties, and (y) not subject the Board to
any liability to the holders of the Rights.
<PAGE 44>
Section 30. Benefits of this Agreement. Nothing in this Agreement shall be
construed to give to any Person other than the Company, the Rights Agent and the
registered holders of the Rights Certificates (and, prior to the Distribution
Date, registered holders of the Common Stock) any legal or equitable right,
remedy or claim under this Agreement; but this Agreement shall be for the sole
and exclusive benefit of the Company, the Rights Agent and the registered
holders of the Rights Certificates (and, prior to the Distribution Date,
registered holders of the Common Stock).
Section 31. 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;
provided, however, that notwithstanding anything in this Agreement to the
contrary, if any such term, provision, covenant or restriction is held by such
court or authority to be invalid, void or unenforceable and the Board determines
in its good faith judgment that severing the invalid language from this
Agreement would adversely affect the purpose or effect of this Agreement, the
right of redemption set forth in Section 23 (Redemption and Termination) shall
be reinstated and shall not expire until the Close of Business on the tenth
Business Day following the date of such determination by the Board.
Section 32. Governing Law. This Agreement, each Right and each Rights
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of Nevada and for all purposes shall be governed by and
construed in accordance with the laws of such State applicable to contracts made
and to be performed entirely within such State.
Section 33. 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 34. 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.
* * * * *
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
Attest:
By:/s/ John B. Johnson
--------------------------
John B. Johnson, Secretary
By:/s/ Shirrell W. Hughes
--------------------------
Name: Shirrell W. Hughes
Title: President
AAON, INC.
By:/s/ Norman H. Asbjornson
--------------------------
Norman H. Asbjornson, President
and Treasurer
PROGRESSIVE TRANSFER COMPANY
By:/s/ Kurtis D. Hughes
-------------------------
Name: Kurtis D. Hughes
Title: Vice President
<PAGE 46>
Exhibit 1
CERTIFICATE OF
DESIGNATION, PREFERENCES AND RIGHTS OF
SERIES A PREFERRED STOCK
of
AAON, INC.
Pursuant to Sections 78.195 and 78.1955 of the Nevada General Corporation
Law
We, Norman H. Asbjornson, President and Treasurer and John B. Johnson,
Secretary of AAON, INC. (the "Corporation"), a corporation organized and
existing under Chapter 78 of the Nevada Revised Statutes, in accordance with the
provisions of Sections 78.035 and 78.195 of the Nevada General Corporation Law,
DO HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board of Directors (the
"Board") by the Amended and Restated Articles of Incorporation of the
Corporation, as amended, the said Board on February 18, 1999, adopted the
following resolutions creating a series of one-hundred thousand shares of
Preferred Stock, par value $.001 per share, designated as Series A Preferred
Stock:
RESOLVED, that, pursuant to the authority vested in the Board in accordance
with the provisions of its Amended and Restated Articles of Incorporation, as
amended, the Board does hereby create, authorize and provide for the issuance
upon the exercise of the Corporation's Preferred Stock Purchase Rights, of a
series of Preferred Stock of the Corporation, and does hereby fix and state that
the designations, amounts, powers, preferences and relative and other special
rights and the qualifications, limitations or restrictions thereof are as
follows:
Series A Preferred Stock
Section 1. Designation and Amount. The shares of such series shall be
designated as Series A Preferred Stock and the number of shares constituting
such series shall be 100,000, which number may be increased or decreased (but
not below the number of shares thereof then outstanding) from time to time by
action of the Board of Directors.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the holders of any shares
of any series of Preferred Stock ranking prior and superior to the shares of
Series A Preferred Stock with respect to dividends, the holders of shares of
Series A Preferred Stock shall be entitled to receive, when, as and if declared
by the Board of Directors out of funds legally available for that purpose,
quarterly dividends payable in cash on the 1st day of July, October, January,
April, in each year commencing April 1, 1999 (each such date being referred to
herein as a "Quarterly Dividend Payment Date"), commencing on the first
Quarterly Dividend Payment Date after the first issuance of a share or fraction
of a share of Series A Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to the greater of (a) $0.01 or (b) subject to the provision
for adjustment hereinafter set forth, one thousand (1,000) times the aggregate
per share amount of all cash dividends, and one thousand (1,000) times the
aggregate per share amount (payable in kind) of all non-cash dividends or other
distributions other than a dividend payable in shares of the common stock of the
Corporation, par value $.004 per share ("the Common Stock"), or a subdivision of
the outstanding shares of Common Stock (by reclassification or otherwise),
declared on the Common Stock, since the immediately preceding Quarterly Dividend
Payment Date, or, with respect to the first Quarterly Dividend Payment Date,
since the first issuance of any share or fraction of a share of Series A
Preferred Stock. In the event the Corporation shall at any time after February
19, 1999 (the "Rights Declaration Date") (i) declare any dividend on Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding Common
Stock, or (iii) combine the outstanding Common Stock into a smaller number of
shares, then in each such case the amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event under clause (b)
of the preceding sentence shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately prior to such
event.
(B) The Corporation shall declare a dividend or distribution on the Series
A Preferred Stock as provided in paragraph (A) above immediately after it
declares a dividend or distribution on the Common Stock (other than a dividend
payable in shares of Common Stock); provided that, in the event no dividend or
distribution shall have been declared on the Common Stock during the period
between any Quarterly Dividend Payment Date and the next subsequent Quarterly
Dividend Payment Date, a dividend of $0.01 per share on the Series A Preferred
Stock shall nevertheless be payable on such subsequent Quarterly Dividend
Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding shares
of Series A Preferred Stock from the Quarterly Dividend Payment Date next
preceding the date of issue of such shares of Series A Preferred Stock, unless
the date of issue of such shares is prior to the record date for the first
Quarterly Dividend Payment Date, in which case dividends on such shares shall
begin to accrue from the date of issue of such shares, or unless the date of
issue is a Quarterly Dividend Payment Date or is a date after the record date
for the determination of holders of shares of Series A Preferred Stock entitled
to receive a quarterly dividend and before such Quarterly Dividend Payment Date,
in either of which events such dividends shall begin to accrue and be cumulative
from such Quarterly Dividend Payment Date. Accrued but unpaid dividends shall
not bear interest. Dividends paid on the shares of Series A Preferred Stock in
an amount less than the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of Directors may fix a
record date for the determination of holders of shares of Series A Preferred
Stock entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be no more than sixty (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 one
thousand (1,000) votes on all matters submitted to a vote of the stockholders of
the Corporation. In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock payable in shares of
Common Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each such case
the 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 herein or by law, the holders of shares of
Series A Preferred Stock and the holders of shares of Common Stock shall vote
together as one class on all matters submitted to a vote of stockholders of the
Corporation. Except as otherwise provided herein or by law, the holders of the
shares of Series A Preferred Stock shall not be entitled to vote as a separate
class on any matters submitted to a vote of the stockholders.
(C) (i) If at any time dividends on any Series A Preferred Stock
shall be in arrears in an amount equal to six (6) quarterly dividends
thereon, the holders of the Series A Preferred Stock, voting as a
separate series from all other series of Preferred Stock and classes
of capital stock, shall be entitled to elect two members of the Board
of Directors in addition to any directors elected by any other series,
class or classes of securities, and the authorized number of directors
will automatically be increased by two. Promptly thereafter, the Board
of Directors of this Corporation shall, as soon as may be practicable,
call a special meeting of holders of Series A Preferred Stock for the
purpose of electing such members of the Board of Directors. Said
special meeting shall in any event be held within 45 days of the
occurrence of such arrearage.
(ii) During any period when the holders of Series A Preferred
Stock, voting as a separate series, shall be entitled and shall have
exercised their right to elect two directors, then and during such
time as such right continues (a) the then authorized number of
directors shall be increased by two, and the holders of Series A
Preferred Stock, voting as a separate series, shall be entitled to
elect the additional directors so provided for, and (b) each such
additional director shall not be a member of any existing class of the
Board of Directors, but shall serve until the next annual meeting of
stockholders for the election of directors, or until his successor
shall be elected and shall qualify, or until his right to hold such
office terminates pursuant to the provisions of this Section 3(C).
(iii) A director elected pursuant to the terms hereof may be
removed with or without cause by the holders of Series A Preferred
Stock entitled to vote in an election of such Director.
(iv) If during any interval between annual meetings of
stockholders for the election of directors and while the holders of
Series A Preferred Stock shall be entitled to elect two directors,
there is no such director in office by reason of resignation, death or
removal, then, promptly thereafter, the Board of Directors shall call
a special meeting of the holders of Series A Preferred Stock for the
purpose of filling such vacancy and such vacancy shall be filled at
such special meeting. Such special meeting shall in any event be held
within 90 days of the occurrence of such vacancy, unless an annual
meeting of stockholders is scheduled during such 90-day period.
(v) At such time as the arrearage is fully cured, and all
dividends accumulated and unpaid on any shares of Series A Preferred
Stock outstanding are paid, and, in addition thereto, at least one
regular dividend has been paid subsequent to curing such arrearage,
the term of office of any directors elected pursuant to this Section
3(C), or his successor, shall automatically terminate, and the
authorized number of directors shall automatically decrease by two,
the rights of the holders of the shares of the Series A Preferred
Stock to vote as provided in this Section 3(C) shall cease, subject to
renewal from time to time upon the same terms and conditions, and the
holders of shares of the Series A Preferred Stock shall have only the
limited voting rights elsewhere herein set forth.
(D) Except as set forth herein, holders of Series A Preferred Stock shall
have no special voting rights and their consent shall not be required (except to
the extent they are entitled to vote with holders of Common Stock as set forth
herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Preferred Stock as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and distributions, whether
or not declared, on shares of Series A Preferred Stock outstanding shall have
been paid in full, the Corporation shall not:
(i) declare or pay dividends on, make any other distributions on,
or redeem or purchase or otherwise acquire for consideration any
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to, the Series A Preferred
Stock;
(ii) declare or pay dividends on, or make any other distributions
on, any shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Preferred
Stock, except dividends paid ratably on the Series A Preferred Stock
and all such junior stock on which dividends are payable or in arrears
in proportion to the total amounts to which the holders of all such
shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, provided that the Corporation may at any time redeem,
purchase or otherwise acquire shares of any such parity stock in
exchange for shares of any stock of the Corporation ranking junior
(either as to dividends or upon dissolution, liquidation or winding
up) to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any shares
of Series A Preferred Stock, or any shares of stock ranking on a
parity with the Series A Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as determined by the
Board of Directors) to all holders of such shares upon such terms as
the Board of Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences of the
respective series and classes, shall determine in good faith will
result in fair and equitable treatment among the respective series or
classes.
(B) The Corporation shall not permit any subsidiary of the Corporation to
purchase or otherwise acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and 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
to be created by resolution or resolutions of the Board of Directors, subject to
the conditions and restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up.
(A) Upon any liquidation (voluntary or otherwise), dissolution or winding
up of the Corporation, no distribution shall be made to the holders of shares of
stock ranking junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series A Preferred Stock unless, prior thereto, the holders
of shares of Series A Preferred Stock shall have received $250 per share, plus
an amount equal to accrued and unpaid dividends and distributions thereon,
whether or not declared, to the date of such payment (the "Series A Liquidation
Preference"). Notwithstanding any provision of the Amended and Restated Articles
of Incorporation, as amended, to the contrary, following the payment of the full
amount of the Series A Liquidation Preference, no additional distributions shall
be made to the holders of shares of Series A Preferred Stock unless, prior
thereto, the holders of shares of Common Stock shall have received an amount per
share (the "Common Adjustment") equal to the quotient obtained by dividing (i)
the Series A Liquidation Preference by (ii) one thousand (1,000) (as
appropriately adjusted as set forth in paragraph (C) of this Section to reflect
such events as stock splits, stock dividends and recapitalizations with respect
to the Common Stock) (such number in clause (ii) immediately above being
referred to as the "Adjustment Number"). Following the payment of the full
amount of the Series A Liquidation Preference and the Common Adjustment in
respect of all outstanding shares of Series A Preferred Stock and Common Stock,
respectively, holders of Series A Preferred Stock and holders of shares of
Common Stock shall receive their ratable and proportionate share of the
remaining assets to be distributed in the ratio of the Adjustment Number to one
(1) with respect to such Preferred Stock and Common Stock, on a per share basis,
respectively.
(B) In the event, however, that there are not sufficient assets available
to permit payment in full of the Series A Liquidation Preference and the
liquidation preferences of all other series of preferred stock, if any, which
rank on a parity with the Series A Preferred Stock, then such remaining assets
shall be distributed ratably to the holders of such parity shares in proportion
to their respective liquidation preferences. In the event, however, that there
are not sufficient assets available to permit payment in full of the Common
Adjustment, then such remaining assets shall be distributed ratably to the
holders of Common Stock.
(C) In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock payable in shares of
Common Stock, (ii) subdivide the outstanding Common Stock, or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each such case
the Adjustment Number in effect immediately prior to such event shall be
adjusted by multiplying such Adjustment Number by a fraction the numerator of
which is the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the Corporation shall enter
into any consolidation, merger, combination or other transaction in which the
shares of Common Stock are exchanged for or changed into other stock,
securities, cash or any other property, then in any such case the shares of
Series A Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to one thousand (1,000) times the aggregate amount
of stock, securities, cash and/or any other property (payable in kind), as the
case may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock payable in shares of
Common Stock, (ii) subdivide the outstanding Common Stock, or (ii) combine the
outstanding Common Stock into a smaller number of shares, then in each such case
the amount set forth in the preceding sentence with respect to the exchange or
change of shares of Series A Preferred Stock shall be adjusted by multiplying
such amount by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding immediately
prior to such event.
Section 8. Redemption. The outstanding shares of Series A Preferred Stock
may be redeemed at the option of the Board of Directors as a whole, but not in
part, at any time, or from to time to time, at a cash price per share equal to
one hundred five percent (105%) of (i) the product of the Adjustment Number
times the Average Market Value (as such term is hereinafter defined) of the
Common Stock, plus (ii) all dividends which on the redemption date have accrued
on the shares to be redeemed and have not been paid, or declared and a sum
sufficient for the payment thereof set apart, without interest. The "Average
Market Value" is the average of the closing sale prices of the Common Stock
during the thirty (30) day period immediately preceding the date before the
redemption date on the Composite Tape for New York Stock Exchange Listed Stocks,
or, if such stock is not quoted on the Composite Tape, on the New York Stock
Exchange, or, if such stock is not listed on such Exchange, on the principal
United States securities exchange registered under the Securities Exchange Act
of 1934, as amended, on which such stock is listed, or, if such stock is not
listed on any such exchange, the average of the closing sale prices with respect
to a share of Common Stock during such thirty (30) day period, as quoted on the
National Association of Securities Dealers, Inc. Automated Quotations System or
any system then in use, or if no such quotations are available, the fair market
value of the Common Stock as determined by the Board of Directors in good faith.
Section 9. Ranking. The Series A Preferred Stock shall rank junior to all
other series of the Corporation's Preferred Stock as to the payment of dividends
and the distribution of assets, unless the terms of any such series shall
provide otherwise.
Section 10. Amendment. Except as otherwise provided in the Amended and
Restated Articles of Incorporation, as amended, or by law, the Amended and
Restated Articles of Incorporation of the Corporation, as amended, shall not be
further amended in any manner which would materially alter or change 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 a majority or more
of the outstanding shares of Series A Preferred Stock, voting separately as a
class.
Section 11. Fractional Shares. At the Corporation's sole discretion, Series
A Preferred Stock may be issued in fractions of a share 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 WITNESS WHEREOF, we have executed and subscribed this Certificate
and do affirm the foregoing as true as of February 19, 1999.
AAON, INC.
By: /s/ Norman H. Asbjornson
------------------------------
Norman H. Asbjornson
President and Treasurer
By: /s/ John B. Johnson
------------------------------
John B. Johnson
Secretary
ACKNOWLEDGMENT
STATE OF OKLAHOMA ss.
ss.
COUNTY OF TULSA ss.
Before me, a Notary Public, on this day personally appeared Norman H.
Asbjornson, known to me to be the person and officer whose name is subscribed to
the foregoing instrument and acknowledged to me that the same was the act of
AAON, Inc., and that he has executed the same on behalf of said corporation for
the purposes and consideration therein expressed, and in the capacity therein
stated.
Given under my hand and seal of office this 19th day of February, 1999.
-----------------
Notary Public in and for the State of
Oklahoma
(PERSONALIZED SEAL)
ACKNOWLEDGMENT
STATE OF OKLAHOMA ss.
ss.
COUNTY OF TULSA ss.
Before me, a Notary Public, on this day personally appeared John B.
Johnson, known to me to be the person and officer whose name is subscribed to
the foregoing instrument and acknowledged to me that the same was the act of
AAON, Inc., and that he has executed the same on behalf of said corporation for
the purposes and consideration therein expressed, and in the capacity therein
stated.
Given under my hand and seal of office this 19th day of February, 1999.
-----------------
Notary Public in and for the State of
Oklahoma
(PERSONALIZED SEAL)
<PAGE 55>
Exhibit 2
[Form of Rights Certificate]
Certificate No. R__________ Rights
NOT EXERCISABLE AFTER THE EARLIER OF MARCH 1, 2009, OR SUCH DATE AS THE RIGHTS
REPRESENTED HEREBY ARE REDEEMED BY AAON, INC. (THE "CORPORATION"). THE RIGHTS
REPRESENTED BY THIS RIGHTS CERTIFICATE ARE SUBJECT TO REDEMPTION, AT THE OPTION
OF THE CORPORATION, AT $0.001 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT DATED AS OF FEBRUARY 19, 1999, BY AND BETWEEN THE CORPORATION AND
PROGRESSIVE TRANSFER COMPANY, AS RIGHTS AGENT (THE "RIGHTS AGREEMENT"). UNDER
CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS SUCH
TERM IS DEFINED IN THE RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH
RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHTS
CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN
ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH
TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHTS CERTIFICATE
AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES
SPECIFIED IN SECTION 7(e) (EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE
OF RIGHTS -- TERMINATION OF ACQUIRING PERSON'S RIGHTS) OF SUCH AGREEMENT.]1
- --------
1 The portion of the legend in brackets shall be inserted only if applicable
and shall replace the preceding sentence.
Rights Certificate
AAON, INC.
This certifies that _________________________________________________, or
its, his or her registered assigns, is the registered owner of the number of
rights set forth above, each of which entitles the owner thereof, subject to the
terms, provisions and conditions of the Rights Agreement, dated as of February
19, 1999 (the "Rights Agreement"), between AAON, Inc., a Nevada corporation (the
"Corporation"), and Progressive Transfer Company (the "Rights Agent"), to
purchase from the Corporation at any time prior to 5:00 P.M. (Tulsa, Oklahoma
time) on March 1, 2009 at the office or offices of the Rights Agent designated
for such purpose, or its successors as Rights Agent, one one-thousandth
(1/1,000) of a fully paid, nonassessable share of Series A Preferred Stock (the
"Preferred Stock") of the Corporation, at a purchase price of $____ per one
one-thousandth (1/1,000) of a share (the "Purchase Price"), upon presentation
and surrender of this Rights Certificate with the Form of Election to Purchase
and related Certificate duly executed. The number of Rights evidenced by this
Rights Certificate (and the number of shares which may be purchased upon
exercise thereof) set forth above, and the Purchase Price set forth above, are
the number and Purchase Price as of _____________, ______, based on the
Preferred Stock as constituted at such date. The Corporation reserves the right
to require prior to the occurrence of a Triggering Event (as such term is
defined in the Rights Agreement) that upon any exercise of Rights, a number of
Rights be exercised so that only whole shares of Preferred Stock would be
issued.
Upon the occurrence of a Flip-in Event (as such term is defined in the
Rights Agreement), if the Rights evidenced by this Rights Certificate are
beneficially owned by (i) an Acquiring Person or an Associate or Affiliate or
any such Person (as such terms are defined in the Rights Agreement), (ii) a
transferee of an Acquiring Person or its Associate or Affiliate who becomes a
transferee after such Acquiring Person or its Associate or Affiliate becomes
such, or (iii) under certain circumstances specified in the Rights Agreement, a
transferee of an Acquiring Person or its Associate or Affiliate who becomes a
transferee prior to or concurrently with the Acquiring Person becoming such,
such Rights shall become null and void and no holder hereof shall have any right
with respect to such Rights from and after the occurrence of such Flip-in Event.
As provided in the Rights Agreement, the Purchase Price and the number and
kind of shares of Preferred Stock or other securities, which may be purchased
upon the exercise of the Rights evidenced by this Rights Certificate are subject
to modification and adjustment upon the happening of certain events, including
Triggering Events (as such term is defined in the Rights Agreement).
This Rights Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
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 Corporation and the holders of the Rights Certificates, which
limitations of rights include the temporary suspension of the exercisability of
such Rights under the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the above-mentioned office of the
Rights Agent and are also available upon written request to the Rights Agent.
This Rights Certificate, with or without other Rights Certificates, upon
surrender at the principal office or offices of the Rights Agent designated for
such purpose, may be exchanged for another Rights Certificate or Rights
Certificates of like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of one one-thousandths of a share of Preferred
Stock as the Rights evidenced by the Rights Certificate or Rights Certificates
surrendered shall have entitled such holder to purchase. If this Rights
Certificate shall be exercised in part, the holder shall be entitled to receive
upon surrender hereof another Rights Certificate or Rights Certificates for the
number of whole Rights for which this Rights Certificate is not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Certificate (i) may be redeemed by the Corporation at its option at a
redemption price of $0.001 per Right at any time prior to the earlier of (a) the
Stock Acquisition Date (as such term is defined in the Rights Agreement) or (b)
the Final Expiration Date (as such term is defined in the Rights Agreement) and
(ii) may be exchanged in whole or in part for Preferred Stock, shares of the
Corporation's Common Stock, par value $.004 per share, other property or any
combination thereof.
In addition, the Rights may be exchanged, in whole or in part, for shares
of the Common Stock, or shares of common stock equivalents of the Corporation
having essentially the same value or economic rights as such shares. Immediately
upon the action of the Board of Directors of the Corporation authorizing any
such exchange, and without any further action or any notice, the Rights (other
than Rights which are not subject to such exchange) will terminate and the
Rights will only enable holders to receive the shares issuable upon such
exchange.
No fractional shares of Preferred Stock will be issued upon the exercise of
any Right or Rights evidenced hereby (other than fractions which are integral
multiples of one one-thousandth (1/1,000) of a share of Preferred Stock, which
may, at the election of the Corporation, be evidenced by depositary receipts),
but a cash payment will be made in lieu thereof, as provided in the Rights
Agreement.
No holder of this Rights Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of shares of Preferred Stock
or of any other securities of the Corporation 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 Corporation or any right to vote for the election of
directors or upon any matter submitted to stockholders of the Corporation 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 of the
Corporation (except as provided in the Rights Agreement), or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by this Rights Certificate shall have been exercised as provided in
the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Corporation
and its corporate seal.
Dated as of _________________
ATTEST: AAON, INC.
- ------------------------------- By:
Secretary Title:
Countersigned:
RIGHTS AGENT
By: ---------------------------------
Authorized Signature
[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Rights Certificate.)
FOR VALUE RECEIVED,
hereby sells, assigns and transfers unto
(Please print name and address of transferee)
this Rights Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint __________________________
Attorney, to transfer the within Rights Certificate on the books of the
within-named Corporation, with full power of substitution.
Dated:
---------------------------
Signature
Signature Guaranteed:
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes that:
(1) this Rights Certificate [ ] is [ ] is not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person or an
Affiliate or Associate of an Acquiring Person (as such terms are defined in the
Rights Agreement); and
(2) after due inquiry and to the best knowledge of the undersigned, it [ ]
did [ ] did not acquire the Rights evidenced by this Rights Certificate from any
Person who is, was or subsequently became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person.
Dated:
---------------------------
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Assignment and Certificate must correspond
to the name as written upon the face of this Rights Certificate in every
particular, without alteration or enlargement or any change whatsoever.
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise Rights represented by the
Rights Certificate.)
To: AAON, INC.
The undersigned hereby irrevocably elects to exercise _______________
Rights represented by this Rights Certificate to purchase the shares of
Preferred Stock issuable upon the exercise of the Rights (or such other
securities of the Corporation or of any other person which may be issuable upon
the exercise of the Rights) and requests that certificates for such shares be
issued in the name of and delivered to:
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
Rights Certificate, a new Rights Certificate for the balance of such Rights
shall be registered in the name of and delivered to:
Please insert social security or
other identifying number
(Please print name and address)
Dated:
---------------------------
Signature
Signature Guaranteed:
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes that:
(1) the Rights evidenced by this Rights Certificate [ ] are [ ] are not
being acquired or exercised by or on behalf of a Person who is or was an
Acquiring Person or an Affiliate or Associate of an Acquiring Person (as such
terms are defined in the Rights Agreement); and
(2) after due inquiry and to the best knowledge of the undersigned, it [ ]
did [ ] did not acquire the Rights evidenced by this Rights Certificate from any
Person who is, was or became an Acquiring Person or an Affiliate or Associate of
an Acquiring Person.
Dated:
---------------------------
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Election to Purchase and Certificate must
correspond to the name as written upon the face of this Rights Certificate in
every particular, without alteration or enlargement or any change whatsoever.
<PAGE 62>
[Letter to Stockholders] Exhibit 3
March 1, 1999
Dear AAON Stockholder:
On February 18, 1999, your Board of Directors adopted a Stockholder Rights
Plan designed to prevent a potential acquiror from gaining control of the
Company without fairly compensating all of the Company's stockholders.
The Rights will initially trade with shares of the Company's Common Stock
and will have no impact on the way in which the Company's shares are traded.
There are no separate certificates or market for the Rights.
The Rights will not become exercisable and trade separately from the
Common Stock until the earlier of (1) ten business days after a public
announcement that a person has acquired 20% or more of the Common Stock of the
Company or (2) ten business days (or any later date determined by the Company's
Board of Directors) after a person makes a tender or exchange offer for 20% or
more of the Company's Common Stock.
Many other public companies have adopted similar plans, indicating
widespread agreement that such plans can help Directors deflect coercive and
inadequate offers.
A summary of the terms of the Rights is included with this letter.
Sincerely,
Norman H. Asbjornson
President and Treasurer
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED STOCK
Effective February 19, 1999, the Board of Directors of AAON, Inc. (the
"Company") declared a dividend distribution of one Right for each outstanding
share of the Company's common stock, $.004 par value (the "Common Stock"), to
stockholders of record at the close of business on March 1, 1999. Each Right
entitles the registered holder to purchase from the Company one one-thousandth
(1/1,000) of a share of Series A Preferred Stock, par value $.001 per share (the
"Preferred Stock"), at a Purchase Price of $60.00 per one one-thousandth
(1/1,000) of a share, subject to adjustment. The description and terms of the
Rights are set forth in a Rights Agreement (the "Rights Agreement") between the
Company and Progressive Transfer Company, as Rights Agent (the "Rights Agent").
Initially, the Rights will be attached to all Common Stock certificates
representing shares then outstanding, and no separate Rights Certificates will
be distributed. The Rights will separate from the Common Stock upon the earlier
of (i) ten (10) business days following a public announcement that a person
(other than Norman H. Asbjornson, the Company's Chief Executive Officer) or
group of affiliated or associated persons (an "Acquiring Person") has acquired,
or obtained the right to acquire, beneficial ownership of twenty percent (20%)
or more of the outstanding shares of Common Stock (the "Stock Acquisition
Date"), or (ii) ten (10) business days (or such later date as the Board of
Directors shall determine) following the commencement of a tender or exchange
offer that would result in a person or group beneficially owning twenty percent
(20%) or more of such outstanding shares of Common Stock. The date the Rights
separate is referred to as the "Distribution Date."
Until the Distribution Date, (i) the Rights will be evidenced by the
Common Stock certificates and will be transferred with and only with such Common
Stock certificates, (ii) new Common Stock certificates issued after March 1,
1999 will contain a notation incorporating the Rights Agreement by reference,
and (iii) the surrender for transfer of any certificates for Common Stock
outstanding will also constitute the transfer of the Rights associated with the
Common Stock represented by such certificates. Pursuant to the Rights Agreement,
the Company reserves the right to require prior to the occurrence of a
Triggering Event (as defined below) that, upon any exercise of Rights, a number
of Rights be exercised so that only whole shares of Preferred Stock will be
issued.
The Rights are not exercisable until the Distribution Date and will expire
at the close of business on March 1, 2009, unless earlier redeemed by the
Company as described below.
As soon as practicable after the Distribution Date, Rights Certificates
will be mailed to holders of record of the Common Stock as of the close of
business on the Distribution Date and, thereafter, the separate Rights
Certificates will represent the Rights. Except in connection with shares of
Common Stock issued or sold pursuant to the exercise of stock options under any
employee plan or arrangements, or upon the exercise, conversion or exchange of
securities hereafter issued by the Company, or as otherwise determined by the
Board of Directors, only shares of Common Stock issued prior to the Distribution
Date will be issued with Rights.
In the event that (i) the Company is the surviving corporation in a merger
or other business combination with an Acquiring Person (or any associate or
affiliate thereof) and its Common Stock remains outstanding and unchanged, (ii)
any person shall acquire beneficial ownership of more than twenty percent (20%)
of the outstanding shares of Common Stock (except pursuant to (A) certain
consolidations or mergers involving the Company or sales or transfers of the
combined assets, cash flow or earning power of the Company and its subsidiaries
or (B) an offer for all outstanding shares of Common Stock at a price and upon
terms and conditions which the Board of Directors determines to be in the best
interests of the Company and its stockholders), or (iii) there occurs a
reclassification of securities, a recapitalization of the Company or any of
certain business combinations or other transactions (other than certain
consolidations and mergers involving the Company and sales or transfers of the
combined assets, cash flow or earning power of the Company and its subsidiaries)
involving the Company or any of its subsidiaries which has the effect of
increasing by more than one percent (1%) the proportionate share of any class of
the outstanding equity securities of the Company or any of its subsidiaries
beneficially owned by an Acquiring Person (or any associate or affiliate
thereof), each holder of a Right (other than the Acquiring Person and certain
related parties) will thereafter have the right to receive, upon exercise,
Common Stock (or, in certain circumstances, cash, property or other securities
of the Company) having a value equal to two times the Purchase Price of the
Right. Notwithstanding any of the foregoing, following the occurrence of any of
the events described in this paragraph, all Rights that are, or (under certain
circumstances specified in the Rights Agreement) were, beneficially owned by any
Acquiring Person will be null and void. The events described in this paragraph
are referred to as "Flip-in Events."
For example, at a Purchase Price of $60.00 per Right, each Right not owned
by an Acquiring Person (or by certain related parties or transferees) following
an event set forth in the preceding paragraph would entitle its holder to
purchase $120.00 worth of Common Stock (or other consideration, as noted above)
for $60.00. Assuming that the Common Stock had a per share market price of
$10.00 at such time, the holder of each valid Right would be entitled to
purchase twelve shares of Common Stock for $60.00.
In the event that, at any time following the Stock Acquisition Date, (i)
the Company shall enter into a merger or other business combination transaction
in which the Company is not the surviving corporation, (ii) the Company is the
surviving corporation in a consolidation, merger or similar transaction pursuant
to which all or part of the outstanding shares of Common Stock are changed into
or exchanged for stock or other securities of any other person or cash or any
other property or (iii) more than 50% of the combined assets, cash flow or
earning power of the Company and its subsidiaries is sold or transferred (in
each case other than certain consolidations with, mergers with and into, or
sales of assets, cash flow or earning power by or to subsidiaries of the Company
as specified in the Rights Agreement), each holder of a Right (except Rights
which previously have been voided as set forth above) shall thereafter have the
right to receive, upon exercise, common stock of the acquiring company having a
value equal to two times the Purchase Price of the Right. The events described
in this paragraph are referred to as "Flip-over Events." Flip-in Events and
Flip-over Events are referred to collectively as "Triggering Events."
The Purchase Price payable, the number and kind of shares covered by each
Right and the number of Rights outstanding are subject to adjustment from time
to time to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred Stock, (ii) if
holders of the Preferred Stock are granted certain rights, options or warrants
to subscribe for Preferred Stock or securities convertible into Preferred Stock
at less than the current market price of the Preferred Stock, or (iii) upon the
distribution to holders of the Preferred Stock of evidences of indebtedness,
cash (excluding regular quarterly cash dividends), assets (other than dividends
payable in Preferred Stock) or subscription rights or warrants (other than those
referred to in (ii) immediately above).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments amount to at least one percent (1%) of the
Purchase Price. No fractional shares of Preferred Stock are required to be
issued (other than fractions which are integral multiples of one one-thousandth
(1/1,000) of a share of Preferred Stock) and, in lieu thereof, the Company may
make an adjustment in cash based on the market price of the Preferred Stock on
the trading date immediately prior to the date of exercise.
At any time after any person or group becomes an Acquiring Person and
prior to the acquisition by such person or group of fifty percent (50%) or more
of the outstanding shares of Common Stock, the Board of Directors of the Company
may, without payment of the Purchase Price by the holder, exchange the Rights
(other than Rights owned by such person or group, which will become void), in
whole or in part, for shares of Common Stock at an exchange ratio of one-half
(1/2) the number of shares of Common Stock (or in certain circumstances
Preferred Stock) for which a Right is exercisable immediately prior to the time
of the Company's decision to exchange the Rights (subject to adjustment).
At any time until the Stock Acquisition Date, the Company may redeem the
Rights in whole, but not in part, at a price of $0.001 per Right (payable in
cash, shares of Common Stock or other consideration deemed appropriate by the
Board of Directors). Immediately upon the action of the Board of Directors
ordering redemption of the Rights, the Rights will terminate and the only right
of the holders of Rights will be to receive the $0.001 redemption price.
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. While the distribution of the Rights will not
be taxable to stockholders or to the Company, stockholders may, depending upon
the circumstances, recognize taxable income in the event that the Rights become
exercisable for Common Stock (or other consideration) of the Company or for
common stock of an acquiring company as set forth above or in the event that the
Rights are redeemed.
Other than those provisions relating to the principal economic terms of
the Rights, any of the provisions of the Rights Agreement may be amended by the
Board of Directors of the Company at any time during the period in which the
Rights are redeemable. At any time when the Rights are no longer redeemable, the
provisions of the Rights Agreement may be amended by the Board only if such
amendment does not adversely affect the interest of holders of Rights (excluding
the interest of any Acquiring Person); provided, however, that no amendment may
cause the Rights again to become redeemable.
A copy of the Rights Agreement has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A filed
on [March ], 1999. A copy of the Rights Agreement is available free of charge
from the Rights Agent. This summary description of the Rights does not purport
to be complete and is qualified in its entirety by reference to the Rights
Agreement, which is incorporated herein by reference.
<PAGE 67>
Exhibit 4
IMMEDIATE Contact:
W.A. Bowen
Vice President - Finance
Phone: 843-520-4835
AAON, INC. ADOPTS STOCKHOLDER RIGHTS PLAN
TULSA, Oklahoma, February 19, 1999... AAON, Inc. [Nasdaq: AAON] (the "Company")
today announced that its Board of Directors has adopted a Stockholder Rights
Plan (the "Plan").
The Plan is designed to protect the Company from unfair or coercive takeover
attempts and to prevent a potential acquiror from gaining control of the Company
without fairly compensating all of the Company's stockholders.
The Plan creates a dividend of one right for each outstanding share of the
Company's Common Stock. The rights are represented by and traded with the
Company's Common Stock. There are no separate certificates or market for the
rights.
The rights do not become exercisable or trade separately from the Common Stock
unless one or both of the following conditions are met: a public announcement
that a person has acquired 20% or more of the Common Stock of the Company, or a
tender or exchange offer is made for 20% or more of the Common Stock of the
Company.
Should either of the aforementioned conditions be met and the rights become
exercisable, each right will entitle the holder thereof to buy 1/1,000th of a
share of the Company's Series A Preferred Stock at an exercise price of $60.00.
Each share of the Series A Preferred Stock will essentially be the economic
equivalent of one share of Common Stock.
Under certain circumstances the rights entitle the holders to buy the Company's
stock at a 50% discount. In the event that (1) the Company is the surviving
corporation in a merger or other business combination with an entity that owns
20% or more of the Company's outstanding stock; (2) any person shall acquire
beneficial ownership of 20% of the Company's outstanding stock; or (3) there is
any type of recapitalization of the Company that results in an increase by more
than 1% the proportionate share of equity securities of the Company owned by a
person who owns 20% or more of the Company's outstanding stock, each right
holder will have the option to buy for the purchase price Common Stock of the
Company having a value equal to two times the purchase price of the right.
Under certain circumstances the rights entitle the holders to buy shares of the
acquiror's Common Stock at a 50% discount. In the event that, at any time after
a person has acquired 20% or more of the Company's Common Stock, (1) the Company
enters into a merger or other business combination transaction in which the
Company is not the surviving corporation; (2) the Company is the surviving
corporation in a transaction in which all or part of the Common Stock is
exchanged for cash, property or securities of any other person; or (3) more than
50% of the assets, cash flow or earning power of the Company is sold, each right
holder will have the option to buy for the purchase price stock of the acquiring
company having a value equal to two times the purchase price of the right.
The rights may be redeemed by the Company for $0.001 per right at any time until
the first public announcement of the acquisition of beneficial ownership of 20%
of the Company's Common Stock. The distribution of the rights will be made to
stockholders of record as of March 1, 1999. Stockholders of record will receive
a separate mailing describing the Plan and a copy of the Plan containing all the
provisions of the new rights will be filed with the Securities and Exchange
Commission by March 1, 1999. The Company's Plan is similar to those adopted by
many other companies.
AAON, Inc. manufactures rooftop commercial heating and air conditioning
equipment, air handlers, condensing units and air conditioning coils. The
Company employs over 1,000 in its Tulsa, Oklahoma and Longview, Texas plants.
