SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
AVONDALE INDUSTRIES, INC.
_________________________________________________________________
(Exact name of registrant as specified in its charter)
Louisiana 39-1097012
________________________________________ _______________
(State of incorporation or organization) (IRS Employer
Identification
No.)
5100 River Road, Avondale, Louisiana 70094
________________________________________ _______________
(Address of principal executive offices) (Zip Code)
Securities to be registered pursuant to Section 12(b) of the Act:
None
Securities to be registered pursuant to Section 12(g) of the Act:
Stock Purchase Rights
_________________________________________________________________
(Title of Class)
<PAGE>
Item 1. Description of Registrant's Securities to be
Registered.
On September 26, 1994, the Board of Directors of Avondale
Industries, Inc., a Louisiana corporation (the "Company"),
declared a dividend payable October 31, 1994 of one right (a
"Right") for each outstanding share of common stock, $1.00 par
value ("Common Stock"), of the Company held of record at the
close of business on October 10, 1994 (the "Record Time"), or
issued thereafter and prior to the Separation Time (as here-
inafter defined) and thereafter pursuant to options and
convertible securities outstanding at the Separation Time. The
Rights will be issued pursuant to a Stockholder Protection Rights
Agreement, dated as of September 26, 1994 (the "Rights
Agreement"), between the Company and Boatmen's Trust Company, as
Rights Agent (the "Rights Agent"). Each Right entitles its
registered holder to purchase from the Company, after the
Separation Time, one one-hundredth of a share of Participating
Preferred Stock, $1.00 par value ("Participating Preferred
Stock"), for $32.00 (the "Exercise Price"), subject to
adjustment.
The Rights will be evidenced by the Common Stock
certificates until the close of business on the earlier of
(either, the "Separation Time") (i) the tenth business day (or
such later date as the Board of Directors of the Company may from
time to time fix by resolution adopted prior to the Separation
Time that would otherwise have occurred) after the date on which
any Person (as defined in the Rights Agreement) commences a
tender or exchange offer which, if consummated, would result in
such Person's becoming an Acquiring Person, as defined below, and
(ii) the tenth day after the first date (the "Flip-in Date") of
public announcement by the Company that a Person has become an
Acquiring Person, other than as a result of a Flip-over
Transaction or Event (as defined below); provided that if the
foregoing results in the Separation Time being prior to the
Record Time, the Separation Time shall be the Record Time; and
provided further that if a tender or exchange offer referred to
in clause (i) is cancelled, terminated or otherwise withdrawn
prior to the Separation Time without the purchase of any shares
of stock pursuant thereto, such offer shall be deemed never to
have been made. An Acquiring Person is any Person having
Beneficial Ownership (as defined in the Rights Agreement) of 15%
or more of the outstanding shares of Common Stock, which term
shall not include (i) the Company's employee stock ownership
trust, the trustees and the administrative committee, but in all
such cases solely in such capacities and solely with respect to
current ownership and specified permitted further acquisitions of
shares of Common Stock, (ii) the Company, any wholly-owned
subsidiary of the Company and any other employee benefit plan of
the Company and any wholly-owned subsidiary of the Company,
(iii) any Person who shall become the Beneficial Owner of 15% or
more of the outstanding Common Stock solely as a result of an
acquisition of Common Stock by the Company, until such time as
such Person acquires additional Common Stock, other than through
a dividend or stock split, (iv) any Person who becomes an
Acquiring Person without any plan or intent to seek or affect
control of the Company if such Person promptly divests sufficient
securities such that such 15% or greater Beneficial Ownership
ceases or (v) any Person who Beneficially Owns shares of Common
Stock consisting solely of (A) shares acquired pursuant to the
grant or exercise of an option granted by the Company in
connection with an agreement to merge with, or acquire, the
Company at a time at which there is no Acquiring Person, (B)
shares owned by such Person and its Affiliates and Associates at
the time of such grant or (C) shares, amounting to less than 1%
of the outstanding Common Stock, acquired by Affiliates and
Associates of such Person after the time of such grant.
The Rights Agreement provides that, until the Separation
Time, the Rights will be transferred with and only with the
Common Stock. Common Stock certificates issued after the Record
Time but prior to the Separation Time shall evidence one Right
for each share of Common Stock represented thereby and shall
contain a legend incorporating by reference the terms of the
Rights Agreement (as such may be amended from time to time).
Notwithstanding the absence of the aforementioned legend,
certificates evidencing shares of Common Stock outstanding at the
Record Time shall also evidence one Right for each share of Com-
mon Stock evidenced thereby. Promptly following the Separation
Time, separate certificates evidencing the Rights ("Rights
Certificates") will be mailed to holders of record of Common
Stock at the Separation Time.
The Rights will not be exercisable until the Business Day
(as defined in the Rights Agreement) following the Separation
Time. The Rights will expire on the earliest of (i) the Exchange
Time (as defined below), (ii) the close of business on
October 10, 2004, (iii) the date on which the Rights are redeemed
as described below and (iv) upon the merger of the Company into
another corporation pursuant to an agreement entered into when
there is no Acquiring Person (in any such case, the "Expiration
Time").
The Exercise Price and the number of Rights outstanding, or
in certain circumstances the securities purchasable upon exercise
of the Rights, are subject to adjustment from time to time to
prevent dilution in the event of a Common Stock dividend on, or a
subdivision or a combination into a smaller number of shares of,
Common Stock, or the issuance or distribution of any securities
or assets in respect of, in lieu of or in exchange for Common
Stock.
In the event that prior to the Expiration Time a Flip-in
Date occurs, the Company shall take such action as shall be
necessary to ensure and provide that each Right (other than
Rights Beneficially Owned on or after the Stock Acquisition Date
by the Acquiring Person or any Affiliate or Associate thereof, or
by any transferee of any of the foregoing, which Rights shall
become void) shall constitute the right to purchase from the
Company, upon the exercise thereof in accordance with the terms
of the Rights Agreement, that number of shares of Common Stock or
Participating Preferred Stock of the Company having an aggregate
Market Price (as defined in the Rights Agreement), on the date of
the public announcement of an Acquiring Person's becoming such
(the "Stock Acquisition Date") that gave rise to the Flip-in
Date, equal to twice the Exercise Price for an amount in cash
equal to the then current Exercise Price. In addition, the Board
of Directors of the Company may, at its option, at any time after
a Flip-in Date and prior to the time that an Acquiring Person
becomes the Beneficial Owner of more than 50% of the outstanding
shares of Common Stock, elect to exchange all (but not less than
all) the then outstanding Rights (other than Rights Beneficially
Owned on or after the Stock Acquisition Date by the Acquiring
Person or any Affiliate or Associate thereof, or by any
transferee of any of the foregoing, which Rights become void) for
shares of Common Stock at an exchange ratio of one share of
Common Stock per Right, appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring
after the date of the Separation Time (the "Exchange Ratio").
Immediately upon such action by the Board of Directors (the
"Exchange Time"), the right to exercise the Rights will terminate
and each Right will thereafter represent only the right to
receive a number of shares of Common Stock equal to the Exchange
Ratio.
Whenever the Company shall become obligated under the
preceding paragraph to issue shares of Common Stock upon exercise
of or in exchange for Rights, the Company, at its option, may
substitute therefor shares of Participating Preferred Stock, at a
ratio of one one-hundredth of a share of Participating Preferred
Stock for each share of Common Stock so issuable.
In the event that prior to the Expiration Time the Company
enters into, consummates or permits to occur a transaction or
series of transactions after the time an Acquiring Person has
become such in which, directly or indirectly, (i) the Company
shall consolidate or merge or participate in a binding share
exchange with any other Person if, at the time of the
consolidation, merger or share exchange or at the time the
Company enters into an agreement with respect to such
consolidation, merger or share exchange, the Acquiring Person
controls the Board of Directors of the Company and any term of or
arrangement concerning the treatment of shares of capital stock
in such merger, consolidation or share exchange relating to the
Acquiring Person is not identical to the terms and arrangements
relating to other holders of Common Stock or (ii) the Company
shall sell or otherwise transfer (or one or more of its
subsidiaries shall sell or otherwise transfer) assets
(A) aggregating more than 50% of the assets (measured by either
book value or fair market value) or (B) generating more than 50%
of the operating income or cash flow, of the Company and its
subsidiaries (taken as a whole) to any other Person (other than
the Company or one or more of its wholly owned subsidiaries) or
to two or more such Persons which are affiliated or otherwise
acting in concert, if, at the time of such sale or transfer of
assets or at the time the Company (or any such subsidiary) enters
into an agreement with respect to such sale or transfer, the
Acquiring Person controls the Board of Directors of the Company
(a "Flip-over Transaction or Event"), the Company shall take such
action as shall be necessary to ensure, and shall not enter into,
consummate or permit to occur such Flip-over Transaction or Event
until it shall have entered into a supplemental agreement with
the Person engaging in such Flip-over Transaction or Event or the
parent corporation thereof (the "Flip-over Entity"), for the
benefit of the holders of the Rights, providing, that upon
consummation or occurrence of the Flip-over Transaction or Event
(i) each Right shall thereafter constitute the right to purchase
from the Flip-over Entity, upon exercise thereof in accordance
with the terms of the Rights Agreement, that number of shares of
common stock of the Flip-over Entity having an aggregate Market
Price on the date of consummation or occurrence of such Flip-over
Transaction or Event equal to twice the Exercise Price for an
amount in cash equal to the then current Exercise Price and
(ii) the Flip-over Entity shall thereafter be liable for, and
shall assume, by virtue of such Flip-over Transaction or Event
and such supplemental agreement, all the obligations and duties
of the Company pursuant to the Rights Agreement. For purposes of
the foregoing description, the term "Acquiring Person" shall
include any Acquiring Person and its Affiliates and Associates
counted together as a single Person.
The Board of Directors of the Company may, at its option, at
any time prior to the close of business on the Flip-in Date,
redeem all (but not less than all) the then outstanding Rights at
a price of $.01 per Right (the "Redemption Price"), as provided
in the Rights Agreement. Immediately upon the action of the
Board of Directors of the Company electing to redeem the Rights,
without any further action and without any notice, the right to
exercise the Rights will terminate and each Right will thereafter
represent only the right to receive the Redemption Price in cash
for each Right so held.
The Company and the Rights Agent may amend the Rights
Agreement without the approval of any holders of Rights (i) prior
to the close of business on the Flip-in Date, in any respect and
(ii) after the close of business on the Flip-on Date, to make any
changes that the Company may deem necessary or desirable and
which shall not materially adversely affect the interests of the
holders of Rights generally, or in order to cure any ambiguity or
to correct or supplement any provision which may be inconsistent
with any other provision or otherwise defective.
The holders of Rights will, solely by reason of their
ownership of Rights, have no rights as stockholders of the
Company, including, without limitation, the right to vote or to
receive dividends.
The Rights will not prevent a takeover of the Company.
However, the Rights may cause substantial dilution to a person or
group that acquires 15% or more of the Common Stock unless the
Rights are first redeemed by the Board of Directors of the
Company. Nevertheless, the Rights should not interfere with a
transaction that is in the best interests of the Company and its
stockholders because the Rights can be redeemed on or prior to
the close of business on the Flip-in Date, before the
consummation of such transaction.
As of September 26, 1994 there were 15,927,191 shares of
Common Stock issued (of which 14,464,175 shares were outstanding
and 1,463,016 shares were held in treasury). As long as the
Rights are attached to the Common Stock, the Company will issue
one Right with each new share of Common Stock so that all such
shares will have Rights attached.
The Rights Agreement (which includes as Exhibit A the forms
of Rights Certificate and Election to Exercise and as Exhibit B
the form of Articles of Amendment for the Company's Participating
Preferred Stock) is attached hereto as an exhibit and is incor-
porated herein by reference. The foregoing description of the
Rights is qualified in its entirety by reference to the Rights
Agreement and such exhibits thereto.
Item 2. Exhibits.
Exhibit No. Description
99.1 Rights Agreement.
99.2 Forms of Rights Certificate and of Election to
Exercise, included in Exhibit A to the Rights
Agreement.
99.3 Form of Articles of Amendment for the Participating
Preferred Stock of the Company, included in Exhibit B
to the Rights Agreement.
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this
registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized.
AVONDALE INDUSTRIES, INC.
By: /s/ Thomas M. Kitchen
Thomas M. Kitchen
Vice President and Chief Financial Officer
Date: September 30, 1994
<PAGEE>
EXHIBIT INDEX
Exhibit No. Description
99.1 Stockholder Protection Rights Agreement, dated
as of September 26, 1994 (the "Rights
Agreement"), between Avondale Industries, Inc.
and Boatmen's Trust Company, as Rights Agent.
99.2 Forms of Rights Certificate and of Election to
Exercise, included in Exhibit A to the Rights
Agreement.
99.3 Form of Articles of Amendment for the
Participating Preferred Stock of the Company,
included in Exhibit B to the Rights Agreement.
STOCKHOLDER PROTECTION RIGHTS AGREEMENT
dated as of
September 26, 1994
between
AVONDALE INDUSTRIES, INC.
and
BOATMEN'S TRUST COMPANY,
as Rights Agent
STOCKHOLDER PROTECTION RIGHTS AGREEMENT
Table of Contents
Page
ARTICLE I. CERTAIN DEFINITIONS
1.1 Certain Definitions................................. 2
ARTICLE II. THE RIGHTS
2.1 Summary of Rights................................... 9
2.2 Legend on Common Stock Certificates................. 9
2.3 Exercise of Rights; Separation of Rights............ 10
2.4 Adjustments to Exercise Price; Number of Rights..... 13
2.5 Date on Which Exercise is Effective................. 15
2.6 Execution, Authentication, Delivery and Dating of
Rights Certificates................................. 15
2.7 Registration, Registration of Transfer and
Exchange............................................ 16
2.8 Mutilated, Destroyed, Lost and Stolen Rights
Certificates........................................ 17
2.9 Persons Deemed Owners............................... 18
2.10 Delivery and Cancellation of Certificates........... 18
2.11 Agreement of Rights Holders......................... 19
ARTICLE III. ADJUSTMENTS TO THE RIGHTS IN THE EVENT OF
CERTAIN TRANSACTIONS
3.1 Flip-in............................................. 20
3.2 Flip-over........................................... 23
ARTICLE IV. THE RIGHTS AGENT
4.1 General............................................. 24
4.2 Merger or Consolidation or Change of Name of
Rights Agent........................................ 25
4.3 Duties of Rights Agent.............................. 26
4.4 Change of Rights Agent.............................. 29
ARTICLE V. MISCELLANEOUS
5.1 Redemption.......................................... 30
5.2 Expiration.......................................... 31
5.3 Issuance of New Rights Certificates................. 31
5.4 Supplements and Amendments.......................... 32
5.5 Fractional Shares................................... 32
5.6 Rights of Action.................................... 32
5.7 Holder of Rights Not Deemed a Stockholder........... 33
5.8 Notice of Proposed Actions.......................... 33
5.9 Notices............................................. 34
5.10 Suspension of Exercisability........................ 35
5.11 Costs of Enforcement................................ 35
5.12 Successors.......................................... 35
-i-
<PAGE>
5.13 Benefits of this Agreement.......................... 35
5.14 Determination and Actions by the Board of
Directors, etc...................................... 36
5.15 Descriptive Headings................................ 36
5.16 Governing Law....................................... 36
5.17 Counterparts........................................ 37
5.18 Severability........................................ 37
EXHIBITS
Exhibit A Form of Rights Certificate
(Together with Form of
Election to Exercise)
Exhibit B Form of Articles of Amendment for the
Participating Preferred Stock
-ii-
<PAGE>
STOCKHOLDER PROTECTION RIGHTS AGREEMENT
STOCKHOLDER PROTECTION RIGHTS AGREEMENT (as amended
from time to time, this "Agreement"), dated as of September 26,
1994, between Avondale Industries, Inc., a Louisiana corporation
(the "Company"), and Boatmen's Trust Company, a Missouri
corporation, as Rights Agent (the "Rights Agent", which term
shall include any successor Rights Agent hereunder).
WITNESSETH:
WHEREAS, the Board of Directors of the Company has
(a) authorized and declared a dividend of one right ("Right") in
respect of each share of Common Stock (as hereinafter defined)
held of record as of the close of business on October 10, 1994
(the "Record Time") and (b) authorized the issuance of one Right
in respect of each share of Common Stock issued after the Record
Time and prior to the Separation Time (as hereinafter defined)
and, to the extent provided in Section 5.3, each share of Common
Stock issued after the Separation Time;
WHEREAS, subject to the terms hereof, each Right
entitles the holder thereof, after the Separation Time, to
purchase securities of the Company (or, in certain cases, of
certain other entities) pursuant to the terms and subject to the
conditions set forth herein; and
WHEREAS, the Company desires to appoint the Rights
Agent to act on behalf of the Company, and the Rights Agent is
willing so to act, in connection with the issuance, transfer,
exchange and replacement of Rights Certificates (as hereinafter
defined), the exercise of Rights and other matters referred to
herein;
NOW THEREFORE, in consideration of the premises and the
respective agreements set forth herein, the parties hereby agree
as follows:
ARTICLE I
CERTAIN DEFINITIONS
1.1 Certain Definitions. For purposes of this
Agreement, the following terms have the meanings indicated:
"Acquiring Person" shall mean any Person who is a
Beneficial Owner of 15% or more of the outstanding shares of
Common Stock; provided, however, that the term "Acquiring Person"
shall not include (i) the Avondale Industries, Inc. Employee
Stock Ownership Trust (the "ESOP Trust") established pursuant to
the Avondale Industries, Inc. Employee Stock Ownership Plan (the
"ESOP"), the ESOP Trustees and the ESOP Administrative Committee,
but in all such cases solely in such capacities, provided that,
in the case of the ESOP Trust, the exclusion under this clause
(i) shall only apply for so long as the ESOP Trust is not the
Beneficial Owner of more than that number of shares of Common
Stock of which it is the record holder as of the Record Time (the
"Record Time ESOP Shares") plus (A) any shares of Common Stock
distributed in respect of the Record Time ESOP Shares or into
which the Record Time ESOP Shares are converted, in each case by
virtue of any stock dividend, subdivision, stock split,
combination or reclassification of Common Stock or any similar
transaction effected by the Company, and (B) any shares of Common
Stock that are acquired by the ESOP Trust, upon written advice of
counsel, a copy of which is delivered to the Company prior to
such acquisition, that such acquisition is necessary to enable
the ESOP Trust to satisfy any requirement imposed by the Employee
Retirement Income Security Act that the assets of the ESOP Trust
be primarily invested in qualifying employer securities; (ii) any
Person who shall become the Beneficial Owner of 15% or more of
the outstanding shares of Common Stock solely as a result of an
acquisition by the Company of shares of Common Stock, until such
time thereafter as such Person shall become the Beneficial Owner
(other than by means of a stock dividend or stock split) of any
additional shares of Common Stock, (iii) any Person who shall
become the Beneficial Owner of 15% or more of the outstanding
shares of Common Stock but who acquired shares of Common Stock
without any plan or intention to seek or affect control of the
Company, if such Person promptly thereafter enters into an
irrevocable commitment promptly to divest, and thereafter
promptly divests (without exercising or retaining any power,
including voting, with respect to such shares), sufficient shares
of Common Stock (or securities convertible into, exchangeable
into or exercisable for Common Stock) so that such Person ceases
to be the Beneficial Owner of 15% or more of the outstanding
shares of Common Stock or (iv) any Person who Beneficially Owns
shares of Common Stock consisting solely of one or more of
(A) shares of Common Stock Beneficially Owned pursuant to the
grant or exercise of an option granted to such Person by the
Company in connection with an agreement to merge with, or
acquire, the Company at a time at which there is no Acquiring
Person, (B) shares of Common Stock (or securities convertible
into, exchangeable into or exercisable for Common Stock),
Beneficially Owned by such Person or its Affiliates or Associates
at the time of grant of such option or (C) shares of Common Stock
(or securities convertible into, exchangeable into or exercisable
for Common Stock) acquired by Affiliates or Associates of such
Person after the time of such grant which, in the aggregate,
amount to less than 1% of the outstanding shares of Common Stock.
In addition, the Company, any wholly-owned Subsidiary of the
Company and other employee benefit plan of the Company or a
wholly-owned Subsidiary of the Company shall not be an Acquiring
Person.
"Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 under the
Securities Exchange Act of 1934, as such Rule is in effect on the
date of this Agreement.
A Person shall be deemed the "Beneficial Owner", and to
have "Beneficial Ownership" of, and to "Beneficially Own", any
securities as to which such Person or any of such Person's
Affiliates or Associates is or may be deemed to be the beneficial
owner of pursuant to Rule 13d-3 and 13d-5 under the Securities
Exchange Act, as such Rules are in effect on the date of this
Agreement as well as any securities as to which such Person or
any of such Person's Affiliates or Associates has the right to
become Beneficial Owner (whether such right is exercisable
immediately or only after the passage of time or the occurrence
of conditions) pursuant to any agreement, arrangement or
understanding, or upon the exercise of conversion rights,
exchange rights, rights (other than the Rights), warrants or
options, or otherwise; provided, however, that a Person shall not
be deemed the "Beneficial Owner", or to have "Beneficial
Ownership" of, or to "Beneficially Own", any security (i) solely
because such security has been tendered pursuant to a tender or
exchange offer made by such Person or any of such Person's
Affiliates or Associates until such tendered security is accepted
for payment or exchange or (ii) solely because such Person or any
of such Person's Affiliates or Associates has or shares the power
to vote or direct the voting of such security pursuant to a
revocable proxy given in response to a public proxy or consent
solicitation made to more than ten holders of shares of a class
of stock of the Company registered under Section 12 of the
Securities Exchange Act of 1934 and pursuant to, and in
accordance with, the applicable rules and regulations under the
Securities Exchange Act of 1934, except if such power (or the
arrangements relating thereto) is then reportable under Item 6 of
Schedule 13D under the Securities Exchange Act of 1934 (or any
similar provision of a comparable or successor report). For
purposes of this Agreement, in determining the percentage of the
outstanding shares of Common Stock with respect to which a Person
is the Beneficial Owner, all shares as to which such Person is
deemed the Beneficial Owner shall be deemed outstanding.
"Business Day" shall mean any day other than a
Saturday, Sunday or a day on which banking institutions in St.
Louis, Missouri are generally authorized or obligated by law or
executive order to close.
"Close of business" on any given date shall mean 5:00
p.m. St. Louis, Missouri time on such date (or, if such date is
not a Business Day, 5:00 p.m. St. Louis, Missouri time on the
next succeeding Business Day) at which the St. Louis, Missouri
office of the transfer agent for the Common Stock (or, after the
Separation Time, the St. Louis, Missouri office of the Rights
Agent) is closed to the public.
"Common Stock" shall mean the shares of Common Stock,
$1.00 par value, of the Company.
"Exchange Time" shall mean the time at which the right
to exercise the Rights shall terminate pursuant to Section 3.1(c)
hereof.
"Exercise Price" shall mean, as of any date, the price
at which a holder may purchase the securities issuable upon
exercise of one whole Right. Until adjustment thereof in
accordance with the terms hereof, the Exercise Price shall equal
$32.00.
"Expiration Time" shall mean the earliest of (i) the
Exchange Time, (ii) the Redemption Time, (iii) the close of
business on the tenth-year anniversary of the Record Time and
(iv) upon the merger of the Company into another corporation
pursuant to an agreement entered into when there is no Acquiring
Person.
"Flip-in Date" shall mean the tenth business day after
any Stock Acquisition Date which is not the result of a Flip-over
Transaction or Event.
"Flip-over Entity," for purposes of Section 3.2, shall
mean (i) in the case of a Flip-over Transaction or Event
described in clause (i) of the definition thereof, the Person
issuing any securities into which shares of Common Stock are
being converted or exchanged and, if no such securities are being
issued, the other party to such Flip-over Transaction or Event
and (ii) in the case of a Flip-over Transaction or Event referred
to in clause (ii) of the definition thereof, the Person receiving
the greatest portion of the assets or earning power being
transferred in such Flip-over Transaction or Event, provided in
all cases if such Person is a subsidiary of a corporation, the
parent corporation shall be the Flip-over Entity.
"Flip-over Stock" shall mean the capital stock (or
similar equity interest) with the greatest voting power in
respect of the election of directors (or other persons similarly
responsible for direction of the business and affairs) of the
Flip-over Entity.
"Flip-over Transaction or Event" shall mean a
transaction or series of transactions after the time when an
Acquiring Person has become such in which, directly or
indirectly, (i) the Company shall consolidate or merge or parti-
cipate in a share exchange with any other Person if, at the time
of the consolidation, merger or share exchange or at the time the
Company enters into any agreement with respect to any such
consolidation, merger or share exchange, the Acquiring Person
controls the Board of Directors of the Company and any term of or
arrangement concerning the treatment of shares of capital stock
in such consolidation, merger or share exchange relating to the
Acquiring Person is not identical to the terms and arrangements
relating to other holders of the Common Stock or (ii) the Company
shall sell or otherwise transfer (or one or more of its
Subsidiaries shall sell or otherwise transfer) assets
(A) aggregating more than 50% of the assets (measured by either
book value or fair market value) or (B) generating more than 50%
of the operating income or cash flow, of the Company and its
Subsidiaries (taken as a whole) to any Person (other than the
Company or one or more of its wholly owned Subsidiaries) or to
two or more such Persons which are Affiliates or Associates or
otherwise acting in concert, if, at the time of the entry by the
Company (or any such Subsidiary) into an agreement with respect
to such sale or transfer of assets, the Acquiring Person controls
the Board of Directors of the Company.
"Market Price" per share of any securities on any date
shall mean the average of the daily closing prices per share of
such securities (determined as described below) on each of the 20
consecutive Trading Days through and including the Trading Day
immediately preceding such date; provided, however, that if an
event of a type analogous to any of the events described in
Section 2.4 hereof shall have caused the closing prices used to
determine the Market Price on any Trading Days during such period
of 20 Trading Days not to be fully comparable with the closing
price on such date, each such closing price so used shall be
appropriately adjusted in order to make it fully comparable with
the closing price on such date. The closing price per share of
any securities on any date shall be the last reported sale price,
regular way, or, in case no such sale takes place or is quoted on
such date, the average of the closing bid and asked prices,
regular way, for each share of such securities, 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, Inc. or, if the securities are
not listed or admitted to trading on the New York Stock
Exchange, Inc., as reported in the principal consolidated trans-
action reporting system with respect to securities listed on the
principal national securities exchange on which the securities
are listed or admitted to trading or, if the securities are not
listed or admitted to trading on any national securities
exchange, 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 securities are not
listed or admitted to trading on any national securities exchange
or 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 securities selected by the Board of
Directors of the Company; provided, however, that if on any such
date the securities are not listed or admitted to trading on a
national securities exchange or traded in the over-the-counter
market, the closing price per share of such securities on such
date shall mean the fair value per share of securities on such
date as determined in good faith by the Board of Directors of the
Company, after consultation with a nationally recognized
investment banking firm, and set forth in a certificate delivered
to the Rights Agent.
"Person" shall mean any individual, firm, partnership,
association, group (as such term is used in Rule 13d-5 under the
Securities Exchange Act of 1934, as such Rule is in effect on the
date of this Agreement), corporation or other entity.
"Preferred Stock" shall mean the series of
Participating Preferred Stock, $1.00 par value, of the Company
created by Articles of Amendment in substantially the form set
forth in Exhibit B hereto appropriately completed.
"Redemption Price" shall mean an amount equal to $0.01.
"Redemption Time" shall mean the time at which the
right to exercise the Rights shall terminate pursuant to
Section 5.1 hereof.
"Separation Time" shall mean the close of business on
the earlier of (i) the tenth business day (or such later date as
the Board of Directors of the Company may from time to time fix
by resolution adopted prior to the Separation Time that would
otherwise have occurred) after the date on which any Person
commences a tender or exchange offer which, if consummated, would
result in such Person's becoming an Acquiring Person and (ii) the
Flip-in Date; provided, that if the foregoing results in the
Separation Time being prior to the Record Time, the Separation
Time shall be the Record Time and provided further, that if any
tender or exchange offer referred to in clause (i) of this
paragraph is cancelled, terminated or otherwise withdrawn prior
to the Separation Time without the purchase of any shares of
Common Stock pursuant thereto, such offer shall be deemed, for
purposes of this paragraph, never to have been made.
"Stock Acquisition Date" shall mean the first date of
public announcement by the Company (by any means) that an
Acquiring Person has become such.
"Subsidiary" of any specified Person shall mean any
corporation or other entity of which a majority of the voting
power of the equity securities or a majority of the equity
interest is Beneficially Owned, directly or indirectly, by such
Person.
"Trading Day," when used with respect to any
securities, shall mean a day on which the New York Stock
Exchange, Inc. is open for the transaction of business or, if
such securities are not listed or admitted to trading on the New
York Stock Exchange, Inc., a day on which the principal national
securities exchange on which such securities are listed or
admitted to trading is open for the transaction of business or,
if such securities are not listed or admitted to trading on any
national securities exchange, a Business Day.
ARTICLE II
THE RIGHTS
2.1 Summary of Rights. As soon as practicable after
the Record Time, the Company will mail a letter summarizing the
terms of the Rights to each holder of record of Common Stock as
of the Record Time, at such holder's address as shown by the
records of the Company.
2.2 Legend on Common Stock Certificates. Certificates
for the Common Stock issued after the Record Time but prior to
the Separation Time shall evidence one Right for each share of
Common Stock represented thereby and shall have impressed on,
printed on, written on or otherwise affixed to them the following
legend:
Until the Separation Time (as defined in the Rights
Agreement referred to below), this certificate also
evidences and entitles the holder hereof to certain Rights
as set forth in a Rights Agreement, dated as of September
26, 1994 (as such may be amended from time to time, the
"Rights Agreement"), between Avondale Industries Inc. (the
"Company") and Boatmen's Trust Company, as Rights Agent, the
terms of which are hereby incorporated herein by reference
and a copy of which is on file at the principal executive
offices of the Company. Under certain circumstances, as set
forth in the Rights Agreement, such Rights may be redeemed,
may be exchanged for shares of Common Stock or other
securities or assets of the Company or a Subsidiary of the
Company, may expire, may become void (if they are "Benefi-
cially Owned" by an "Acquiring Person" or an Affiliate or
Associate thereof, as such terms are defined in the Rights
Agreement, or by any transferee of any of the foregoing) or
may be evidenced by separate certificates and may no longer
be evidenced by this certificate. The Company will mail or
arrange for the mailing of a copy of the Rights Agreement to
the holder of this certificate without charge within five
days after the receipt of a written request therefor.
Certificates representing shares of Common Stock that are issued
and outstanding at the Record Time shall evidence one Right for
each share of Common Stock evidenced thereby notwithstanding the
absence of the foregoing legend.
2.3 Exercise of Rights; Separation of Rights.
(a) Subject to Sections 3.1, 5.1 and 5.10 and subject to
adjustment as herein set forth, each Right will entitle the
holder thereof, after the Separation Time and prior to the
Expiration Time, to purchase, for the Exercise Price, one one-
hundredth of a share of Preferred Stock.
(b) Until the Separation Time, (i) no Right may be
exercised and (ii) each Right will be evidenced by the
certificate for the associated share of Common Stock (together,
in the case of certificates issued prior to the Record Time, with
the letter mailed to the record holder thereof pursuant to
Section 2.1) and will be transferable only together with, and
will be transferred by a transfer (whether with or without such
letter) of, such associated share.
(c) Subject to the terms hereof, after the Separation
Time and prior to the Expiration Time, the Rights (i) may be
exercised and (ii) may be transferred independent of shares of
Common Stock. Promptly following the Separation Time, the Rights
Agent will mail to each holder of record of Common Stock as of
the Separation Time (other than any Person whose Rights have
become void pursuant to Section 3.1(b)), at such holder's address
as shown by the records of the Company (the Company hereby
agreeing to furnish copies of such records to the Rights Agent
for this purpose), (x) a certificate (a "Rights Certificate") in
substantially the form of Exhibit A hereto appropriately
completed, representing the number of Rights held by such holder
at the Separation Time and having 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 law or with any rule or regulation
made pursuant thereto or with any rule or regulation of any
national securities exchange or quotation system on which the
Rights may from time to time be listed or traded, or to conform
to usage, and (y) a disclosure statement describing the Rights.
(d) Subject to the terms hereof, Rights may be
exercised on any Business Day after the Separation Time and prior
to the Expiration Time by submitting to the Rights Agent the
Rights Certificate evidencing such Rights with an Election to
Exercise (an "Election to Exercise") substantially in the form
attached to the Rights Certificate duly completed, accompanied by
payment in cash, or by certified or official bank check or money
order payable to the order of the Company, of a sum equal to the
Exercise Price multiplied by the number of Rights being exercised
and a sum sufficient to cover any transfer tax or charge which
may be payable in respect of any transfer involved in the
transfer or delivery of Rights Certificates or the issuance or
delivery of certificates for shares or depositary receipts (or
both) in a name other than that of the holder of the Rights being
exercised.
(e) Upon receipt of a Rights Certificate, with an
Election to Exercise accompanied by payment as set forth in
Section 2.3(d), and subject to the terms hereof, the Rights Agent
will thereupon promptly (i)(A) requisition from a transfer agent
stock certificates evidencing such number of shares or other
securities to be purchased (the Company hereby irrevocably
authorizing its transfer agents to comply with all such
requisitions) and (B) if the Company elects pursuant to
Section 5.5 not to issue certificates representing fractional
shares, requisition from the depositary selected by the Company
depositary receipts representing the fractional shares to be
purchased or requisition from the Company the amount of cash to
be paid in lieu of fractional shares in accordance with
Section 5.5 and (ii) after receipt of such certificates, deposi-
tary receipts and/or cash, deliver the same to or upon the order
of the registered holder of such Rights Certificate, registered
(in the case of certificates or depositary receipts) in such name
or names as may be designated by such holder.
(f) In case the holder of any Rights shall exercise
less than all the Rights evidenced by such holder's Rights
Certificate, a new Rights Certificate evidencing the Rights
remaining unexercised will be issued by the Rights Agent to such
holder or to such holder's duly authorized assigns.
(g) The Company covenants and agrees that it will
(i) take all such action as may be necessary to ensure that all
shares delivered upon exercise of Rights shall, at the time of
delivery of the certificates for such shares (subject to payment
of the Exercise Price), be duly and validly authorized, executed,
issued and delivered and fully paid and nonassessable; (ii) take
all such action as may be necessary to comply with any applicable
requirements of the Securities Act of 1933 or the Securities
Exchange Act of 1934, and the rules and regulations thereunder,
and any other applicable law, rule or regulation, in connection
with the issuance of any shares upon exercise of Rights; and
(iii) pay when due and payable any and all federal and state
transfer taxes and charges which may be payable in respect of the
original issuance or delivery of the Rights Certificates or of
any shares issued upon the exercise of Rights, provided that the
Company shall not be required to pay any transfer tax or charge
which may be payable in respect of any transfer involved in the
transfer or delivery of Rights Certificates or the issuance or
delivery of certificates for shares in a name other than that of
the holder of the Rights being transferred or exercised.
2.4 Adjustments to Exercise Price; Number of Rights.
(a) In the event the Company shall at any time after the Record
Time and prior to the Separation Time (i) declare or pay a
dividend on Common Stock payable in Common Stock, (ii) subdivide
the outstanding Common Stock or (iii) combine the outstanding
Common Stock into a smaller number of shares of Common Stock,
(x) the Exercise Price in effect after such adjustment will be
equal to the Exercise Price in effect immediately prior to such
adjustment divided by the number of shares of Common Stock (the
"Expansion Factor") that a holder of one share of Common Stock
immediately prior to such dividend, subdivision or combination
would hold thereafter as a result thereof and (y) each Right held
prior to such adjustment will become that number of Rights equal
to the Expansion Factor, and the adjusted number of Rights will
be deemed to be distributed among the shares of Common Stock with
respect to which the original Rights were associated (if they
remain outstanding) and the shares issued in respect of such
dividend, subdivision or combination, so that each such share of
Common Stock will have exactly one Right associated with it.
Each adjustment made pursuant to this paragraph shall be made as
of the payment or effective date for the applicable dividend,
subdivision or combination.
In the event the Company shall at any time after the
Record Time and prior to the Separation Time issue any shares of
Common Stock otherwise than in a transaction referred to in the
preceding paragraph, each such share of Common Stock so issued
shall automatically have one new Right associated with it, which
Right shall be evidenced by the certificate representing such
share. To the extent provided in Section 5.3, Rights shall be
issued by the Company in respect of shares of Common Stock that
are issued or sold by the Company after the Separation Time.
(b) In the event the Company shall at any time after
the Record Time and prior to the Separation Time issue or
distribute any securities or assets in respect of, in lieu of or
in exchange for Common Stock (other than pursuant to a regular
periodic cash dividend or a dividend paid solely in Common Stock)
whether by dividend, in a reclassification or recapitalization
(including any such transaction involving a merger, consolidation
or share exchange), or otherwise, the Company shall make such
adjustments, if any, in the Exercise Price, number of Rights
and/or securities or other property purchasable upon exercise of
Rights as the Board of Directors of the Company, in its sole
discretion, may deem to be appropriate under the circumstances in
order to adequately protect the interests of the holders of
Rights generally, and the Company and the Rights Agent shall
amend this Agreement as necessary to provide for such
adjustments.
(c) Each adjustment to the Exercise Price made
pursuant to this Section 2.4 shall be calculated to the nearest
cent. Whenever an adjustment to the Exercise Price is made
pursuant to this Section 2.4, the Company shall (i) promptly
prepare a certificate setting forth such adjustment and a brief
statement of the facts accounting for such adjustment,
(ii) promptly file with the Rights Agent and with each transfer
agent for the Common Stock a copy of such certificate and
(iii) mail a brief summary thereof to each holder of Rights.
(d) Irrespective of any adjustment or change in the
securities purchasable upon exercise of the Rights, the Rights
Certificates theretofore and thereafter issued may continue to
express the securities so purchasable which were expressed in the
initial Rights Certificates issued hereunder.
2.5 Date on Which Exercise is Effective. Each person
in whose name any certificate for shares is issued upon the
exercise of Rights shall for all purposes be deemed to have
become the holder of record of the shares represented thereby on,
and such certificate shall be dated, the date upon which the
Rights Certificate evidencing such Rights was duly surrendered
and payment of the Exercise Price for such Rights (and any
applicable taxes and other governmental charges payable by the
exercising holder hereunder) was made; provided, however, that if
the date of such surrender and payment is a date upon which the
stock transfer books of the Company are closed, such person shall
be deemed to have become the record holder of such shares on, and
such certificate shall be dated, the next succeeding Business Day
on which the stock transfer books of the Company are open.
2.6 Execution, Authentication, Delivery and Dating of
Rights Certificates. (a) The Rights Certificates shall be
executed on behalf of the Company by its Chairman of the Board,
President or one of its Vice Presidents, under its corporate seal
reproduced thereon attested by its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on
the Rights Certificates may be manual or facsimile.
Rights Certificates bearing the manual or facsimile
signatures of individuals who were at any time the proper
officers of the Company shall bind the Company, notwithstanding
that such individuals or any of them have ceased to hold such
offices prior to the countersignature and delivery of such Rights
Certificates.
Promptly after the Company learns of the Separation
Time, the Company will notify the Rights Agent of such Separation
Time and will deliver Rights Certificates executed by the Company
to the Rights Agent for countersignature, and, subject to Section
3.1(b), the Rights Agent shall manually countersign and deliver
such Rights Certificates to the holders of the Rights pursuant to
Section 2.3(c) hereof. No Rights Certificate shall be valid for
any purpose unless manually countersigned by the Rights Agent.
(b) Each Rights Certificate shall be dated the date of
countersignature thereof.
2.7 Registration, Registration of Transfer and
Exchange. (a) After the Separation Time, the Company will cause
to be kept a register (the "Rights Register") in which, subject
to such reasonable regulations as it may prescribe, the Company
will provide for the registration and transfer of Rights. The
Rights Agent is hereby appointed "Rights Registrar" for the
purpose of maintaining the Rights Register for the Company and
registering Rights and transfers of Rights after the Separation
Time as herein provided. In the event that the Rights Agent
shall cease to be the Rights Registrar, the Rights Agent will
have the right to examine the Rights Register at all reasonable
times after the Separation Time.
After the Separation Time and prior to the Expiration
Time, upon surrender for registration of transfer or exchange of
any Rights Certificate, and subject to the provisions of
Section 2.7(c) and (d), the Company will execute, and the Rights
Agent will countersign and deliver, in the name of the holder or
the designated transferee or transferees, as required pursuant to
the holder's instructions, one or more new Rights Certificates
evidencing the same aggregate number of Rights as did the Rights
Certificate so surrendered.
(b) Except as otherwise provided in Section 3.1(b),
all Rights issued upon any registration of transfer or exchange
of Rights Certificates shall be the valid obligations of the
Company, and such Rights shall be entitled to the same benefits
under this Agreement as the Rights surrendered upon such
registration of transfer or exchange.
(c) Every Rights Certificate surrendered for
registration of transfer or exchange shall be duly endorsed, or
be accompanied by a written instrument of transfer in form
satisfactory to the Company or the Rights Agent, as the case may
be, duly executed by the holder thereof or such holder's attorney
duly authorized in writing. As a condition to the issuance of
any new Rights Certificate under this Section 2.7, the Company
may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation
thereto.
(d) The Company shall not be required to register the
transfer or exchange of any Rights after such Rights have become
void under Section 3.1(b), been exchanged under Section 3.1(c) or
been redeemed or terminated under Section 5.1.
2.8 Mutilated, Destroyed, Lost and Stolen Rights
Certificates. (a) If any mutilated Rights Certificate is
surrendered to the Rights Agent prior to the Expiration Time,
then, subject to Sections 3.1(b) and 5.1, the Company shall
execute and the Rights Agent shall countersign and deliver in
exchange therefor a new Rights Certificate evidencing the same
number of Rights as did the Rights Certificate so surrendered.
(b) If there shall be delivered to the Company and the
Rights Agent prior to the Expiration Time (i) evidence to their
satisfaction of the destruction, loss or theft of any Rights
Certificate and (ii) such security or indemnity as may be
required by them to save each of them and any of their agents
harmless, then, subject to Sections 3.1(b) and 5.1 and in the
absence of notice to the Company or the Rights Agent that such
Rights Certificate has been acquired by a bona fide purchaser,
the Company shall execute and upon its request the Rights Agent
shall countersign and deliver, in lieu of any such destroyed,
lost or stolen Rights Certificate, a new Rights Certificate
evidencing the same number of Rights as did the Rights
Certificate so destroyed, lost or stolen.
(c) As a condition to the issuance of any new Rights
Certificate under this Section 2.8, the Company may require the
payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and
any other expenses (including the fees and expenses of the Rights
Agent) connected therewith.
(d) Every new Rights Certificate issued pursuant to
this Section 2.8 in lieu of any destroyed, lost or stolen Rights
Certificate shall evidence an original additional contractual
obligation of the Company, whether or not the destroyed, lost or
stolen Rights Certificate shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this
Agreement equally and proportionately with any and all other
Rights duly issued hereunder.
2.9 Persons Deemed Owners. Prior to due presentment
of a Rights Certificate (or, prior to the Separation Time, the
associated Common Stock certificate) for registration of
transfer, the Company, the Rights Agent and any agent of the
Company or the Rights Agent may deem and treat the person in
whose name such Rights Certificate (or, prior to the Separation
Time, such Common Stock certificate) is registered as the
absolute owner thereof and of the Rights evidenced thereby for
all purposes whatsoever, including the payment of the Redemption
Price and neither the Company nor the Rights Agent shall be
affected by any notice to the contrary. As used in this
Agreement, unless the context otherwise requires, the term
"holder" of any Rights shall mean the registered holder of such
Rights (or, prior to the Separation Time, the associated shares
of Common Stock).
2.10 Delivery and Cancellation of Certificates. All
Rights Certificates surrendered upon exercise or for registration
of transfer or exchange shall, if surrendered to any person other
than the Rights Agent, be delivered to the Rights Agent and, in
any case, shall be promptly cancelled by the Rights Agent. The
Company may at any time deliver to the Rights Agent for
cancellation any Rights Certificates previously countersigned and
delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Rights Certificates so delivered shall
be promptly cancelled by the Rights Agent. No Rights
Certificates shall be countersigned in lieu of or in exchange for
any Rights Certificates cancelled as provided in this
Section 2.10, except as expressly permitted by this Agreement.
The Rights Agent shall destroy all cancelled Rights Certificates
and deliver a certificate of destruction to the Company.
2.11 Agreement of Rights Holders. Every holder of
Rights by accepting the same consents and agrees with the Company
and the Rights Agent and with every other holder of Rights that:
(a) prior to the Separation Time, each Right will be
transferable only together with, and will be transferred by a
transfer of, the associated share of Common Stock;
(b) after the Separation Time, the Rights Certificates
will be transferable only on the Rights Register as provided
herein;
(c) prior to due presentment of a Rights Certificate
(or, prior to the Separation Time, the associated Common Stock
certificate) for registration of transfer, the Company, the
Rights Agent and any agent of the Company or the Rights Agent may
deem and treat the person in whose name the Rights Certificate
(or, prior to the Separation Time, the associated Common Stock
certificate) is registered as the absolute owner thereof and of
the Rights evidenced thereby for all purposes whatsoever, and
neither the Company nor the Rights Agent shall be affected by any
notice to the contrary;
(d) Rights beneficially owned by certain Persons will,
under the circumstances set forth in Section 3.1(b), become void;
and
(e) this Agreement may be supplemented or amended from
time to time pursuant to Section 2.4(b) or 5.4 hereof.
ARTICLE III
ADJUSTMENTS TO THE RIGHTS IN
THE EVENT OF CERTAIN TRANSACTIONS
3.1 Flip-in. (a) In the event that prior to the
Expiration Time a Flip-in Date shall occur, the Company shall
take such action as shall be necessary to ensure and provide
that, except as provided in this Section 3.1, each Right shall
constitute the right to purchase from the Company, upon exercise
thereof in accordance with the terms hereof (but subject to
Section 5.10), that number of shares of Common Stock having an
aggregate Market Price on the Stock Acquisition Date equal to
twice the Exercise Price for an amount in cash equal to the
Exercise Price (such right to be appropriately adjusted in order
to protect the interests of the holders of Rights generally in
the event that on or after such Stock Acquisition Date an event
of a type analogous to any of the events described in
Section 2.4(a) or (b) shall have occurred with respect to the
Common Stock).
(b) Notwithstanding the foregoing, any Rights that
are or were Beneficially Owned on or after the Stock Acquisition
Date by an Acquiring Person or an Affiliate or Associate thereof
or by any transferee, direct or indirect, of any of the foregoing
shall become void and any holder of such Rights (including trans-
ferees) shall thereafter have no right to exercise or transfer
such Rights under any provision of this Agreement. If any Rights
Certificate is presented for assignment or exercise and the
Person presenting the same will not complete the certification
set forth at the end of the form of assignment or notice of
election to exercise and provide such additional evidence of the
identity of the Beneficial Owner and its Affiliates and
Associates (or former Beneficial Owners and their Affiliates and
Associates) as the Company shall reasonably request, then the
Company shall be entitled conclusively to deem the Beneficial
Owner thereof to be an Acquiring Person or an Affiliate or
Associate thereof or a transferee of any of the foregoing and
accordingly will deem the Rights evidenced thereby to be void and
not transferable or exercisable.
(c) The Board of Directors of the Company may, at its
option, at any time after a Flip-in Date and prior to the time
that an Acquiring Person becomes the Beneficial Owner of more
than 50% of the outstanding shares of Common Stock, elect to
exchange all (but not less than all) the then outstanding Rights
(which shall not include Rights that have become void pursuant to
the provisions of Section 3.1(b)) for shares of Common Stock at
an exchange ratio of one share of Common Stock per Right,
appropriately adjusted in order to protect the interests of
holders of Rights generally in the event that after the
Separation Time an event of a type analogous to any of the events
described in Section 2.4(a) or (b) shall have occurred with
respect to the Common Stock (such exchange ratio, as adjusted
from time to time, being hereinafter referred to as the "Exchange
Ratio").
Immediately upon the action of the Board of Directors
of the Company electing to exchange the Rights, without any
further action and without any notice, the right to exercise the
Rights will terminate and each Right (other than Rights that have
become void pursuant to Section 3.1(b)) will thereafter represent
only the right to receive a number of shares of Common Stock
equal to the Exchange Ratio. Promptly after the action of the
Board of Directors electing to exchange the Rights, the Company
shall give notice thereof (specifying the steps to be taken to
receive shares of Common Stock in exchange for Rights) to the
Rights Agent and the holders of the Rights (other than Rights
that have become void pursuant to Section 3.1(b)) outstanding
immediately prior thereto by mailing such notice in accordance
with Section 5.9.
Each Person in whose name any certificate for shares is
issued upon the exchange of Rights pursuant to this Section
3.1(c) or Section 3.1(d) shall for all purposes be deemed to have
become the holder of record of the shares represented thereby on,
and such certificate shall be dated, the date upon which the
Rights Certificate evidencing such Rights was duly surrendered
and payment of any applicable taxes and other governmental
charges payable by the holder was made; provided, however, that
if the date of such surrender and payment is a date upon which
the stock transfer books of the Company are closed, such Person
shall be deemed to have become the record holder of such shares
on, and such certificate shall be dated, the next succeeding
Business Day on which the stock transfer books of the Company are
open.
(d) Whenever the Company shall become obligated under
Section 3.1(a) or (c) to issue shares of Common Stock upon
exercise of or in exchange for Rights, the Company, at its
option, may substitute therefor shares of Preferred Stock, at a
ratio of one one-hundredth of a share of Preferred Stock for each
share of Common Stock so issuable.
(e) In the event that there shall not be sufficient
treasury shares or authorized but unissued shares of Common Stock
or Preferred Stock of the Company to permit the exercise or
exchange in full of the Rights in accordance with Section 3.1(a)
or (c), the Company shall either (i) call a meeting of
stockholders seeking approval to cause sufficient additional
shares to be authorized (provided that if such approval is not
obtained the Company will take the action specified in
clause (ii) of this sentence) or (ii) take such action as shall
be necessary to ensure and provide, to the extent permitted by
applicable law and any agreements or instruments in effect on the
Stock Acquisition Date to which it is a party, that each Right
shall thereafter constitute the right to receive, (x) at the
Company's option, either (A) in return for the Exercise Price,
debt or equity securities or other assets (or a combination
thereof) having a fair value equal to twice the Exercise Price,
or (B) without payment of consideration (except as otherwise
required by applicable law), debt or equity securities or other
assets (or a combination thereof) having a fair value equal to
the Exercise Price, or (y) if the Board of Directors of the
Company elects to exchange the Rights in accordance with Section
3.1(c), debt or equity securities or other assets (or a
combination thereof) having a fair value equal to the product of
the Market Price of a share of Common Stock on the Flip-in Date
times the Exchange Ratio in effect on the Flip-in Date, where in
any case set forth in (x) or (y) above the fair value of such
debt or equity securities or other assets shall be as determined
in good faith by the Board of Directors of the Company, after
consultation with a nationally recognized investment banking
firm.
3.2 Flip-over. (a) Prior to the Expiration Time, the
Company shall not enter into any agreement with an Acquiring
Person (or any of its Affiliates or Associates) with respect to,
consummate or permit to occur any Flip-over Transaction or Event
unless and until it shall have entered into a supplemental
agreement with the Flip-over Entity, for the benefit of the
holders of the Rights, providing that, upon consummation or
occurrence of the Flip-over Transaction or Event (i) each Right
shall thereafter constitute the right to purchase from the Flip-
over Entity, upon exercise thereof in accordance with the terms
hereof, that number of shares of Flip-over Stock of the Flip-over
Entity having an aggregate Market Price on the date of consum-
mation or occurrence of such Flip-over Transaction or Event equal
to twice the Exercise Price for an amount in cash equal to the
Exercise Price (such right to be appropriately adjusted in order
to protect the interests of the holders of Rights generally in
the event that after such date of consummation or occurrence an
event of a type analogous to any of the events described in
Section 2.4(a) or (b) shall have occurred with respect to the
Flip-over Stock) and (ii) the Flip-over Entity shall thereafter
be liable for, and shall assume, by virtue of such Flip-over
Transaction or Event and such supplemental agreement, all the
obligations and duties of the Company pursuant to this Agreement.
The provisions of this Section 3.2 shall apply to successive
Flip-over Transactions or Events.
(b) Prior to the Expiration Time, unless the Rights
will be redeemed pursuant to Section 5.1 hereof in connection
therewith, the Company shall not enter into any agreement with
respect to, consummate or permit to occur any Flip-over
Transaction or Event if at the time thereof there are any rights,
warrants or securities outstanding or any other arrangements,
agreements or instruments that would eliminate or otherwise
diminish in any material respect the benefits intended to be
afforded by this Rights Agreement to the holders of Rights upon
consummation of such transaction.
ARTICLE IV
THE RIGHTS AGENT
4.1 General. (a) 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 agrees to pay to the
Rights Agent reasonable compensation for all services rendered by
it hereunder and, from time to time, on demand of the Rights
Agent, its reasonable expenses and counsel fees and other
disbursements incurred in the administration and execution of
this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent
for, and to hold it harmless against, any loss, liability, or
expense, incurred without 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 any claim of liability.
(b) The Rights Agent shall be protected and shall
incur no liability for or in respect of any action taken,
suffered or omitted by it in connection with its administration
of this Agreement in reliance upon any certificate for securities
purchasable upon exercise of Rights, Rights Certificate,
certificate 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.
4.2 Merger or Consolidation or Change of Name of
Rights Agent. (a) Any corporation into which the Rights Agent
or any successor Rights Agent may be merged or with which it may
be consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights
Agent is a party, or any corporation succeeding to the
shareholder services business of the Rights Agent or any
successor Rights Agent, will be the successor to the Rights Agent
under this Agreement without the execution or filing of any paper
or any further act on the part of any of the parties hereto,
provided that such corporation would be eligible for appointment
as a successor Rights Agent under the provisions of Section 4.4
hereof. In case at the time such successor Rights Agent succeeds
to the agency created by this Agreement any of the Rights
Certificates have been countersigned but not delivered, any such
successor Rights Agent may adopt the countersignature of the
predecessor Rights Agent and deliver such Rights Certificates so
countersigned; and in case at that time any of the Rights
Certificates have not been countersigned, any successor Rights
Agent may countersign such Rights Certificates either in the name
of the predecessor Rights Agent or in the name of the successor
Rights Agent; and in all such cases such Rights Certificates will
have the full force provided in the Rights Certificates and in
this Agreement.
(b) In case at any time the name of the Rights Agent
is 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.
4.3 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) The Rights Agent may consult with legal counsel
(who may be legal counsel for the Company), and the opinion of
such counsel will be full and complete authorization and
protection to the Rights Agent as to any action taken or omitted
by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under
this Agreement the Rights Agent deems it necessary or desirable
that any fact or matter be proved or established by the Company
prior to taking or suffering any action hereunder, such fact or
matter (unless other evidence in respect thereof be herein
specifically prescribed) may be deemed to be conclusively proved
and established by a certificate signed by a person believed by
the Rights Agent to be the Chairman of the Board, the President
or any Vice President and by the Treasurer or any Assistant
Treasurer or the Secretary or any Assistant Secretary of the
Company and delivered to the Rights Agent; and such certificate
will be full authorization to the Rights Agent for any action
taken or suffered in good faith by it under the provisions of
this Agreement in reliance upon such certificate.
(c) The Rights Agent will be liable hereunder only for
its own negligence, bad faith or willful misconduct.
(d) The Rights Agent will not be liable for or by
reason of any of the statements of fact or recitals contained in
this Agreement or in the certificates for securities purchasable
upon exercise of Rights or the Rights Certificates (except its
countersignature thereof) or be required to verify the same, but
all such statements and recitals are and will be deemed to have
been made by the Company only.
(e) The Rights Agent will not be under any
responsibility in respect of the validity of this Agreement or
the execution and delivery hereof (except the due authorization,
execution and delivery hereof by the Rights Agent) or in respect
of the validity or execution of any certificate for securities
purchasable upon exercise of Rights or Rights Certificate (except
its countersignature thereof); nor will it be responsible for any
breach by the Company of any covenant or condition contained in
this Agreement or in any Rights Certificate; nor will it be
responsible for any change in the exercisability of the Rights
(including the Rights becoming void pursuant to Section 3.1(b)
hereof) or any adjustment required under the provisions of
Section 2.4, 3.1 or 3.2 hereof or responsible for the manner,
method or amount of any such adjustment or the ascertaining of
the existence of facts that would require any such adjustment
(except with respect to the exercise of Rights after receipt of
the certificate contemplated by Section 2.4 describing any such
adjustment); nor will it by any act hereunder be deemed to make
any representation or warranty as to the authorization or
reservation of any securities purchasable upon exercise of Rights
or any Rights or as to whether any securities purchasable upon
exercise of Rights will, when issued, be duly and validly
authorized, executed, issued and delivered and fully paid and
nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts,
instruments and assurances as may reasonably be required by the
Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its
duties hereunder from any person believed by the Rights Agent to
be the Chairman of the Board, the President or any Vice President
or the Secretary or any Assistant Secretary or 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 by it
in good faith in accordance with instructions of any such person.
(h) The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal in
Common Stock, Rights or other securities of the Company or become
pecuniarily interested in any transaction in which the Company
may be interested, or contract with or lend money to the Company
or otherwise act as fully and freely as though it were not Rights
Agent under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or
for any other legal entity.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents,
and the Rights Agent will not be answerable or accountable for
any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct, provided reasonable care was
exercised in the selection and continued employment thereof.
4.4 Change of Rights Agent. The Rights Agent may
resign and be discharged from its duties under this Agreement
upon 90 days' notice (or such lesser notice as is acceptable to
the Company) in writing mailed to the Company and to each
transfer agent of Common Stock by registered or certified mail,
and to the holders of the Rights in accordance with Section 5.9.
The Company may remove the Rights Agent upon 30 days' notice in
writing, mailed to the Rights Agent and to each transfer agent of
the Common Stock by registered or certified mail, and to the
holders of the Rights in accordance with Section 5.9. If the
Rights Agent should resign or be removed or otherwise become
incapable of acting, the Company will appoint a successor to the
Rights Agent. If the Company fails to make such appointment
within a period of 30 days after such removal or after it has
been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the holder of any
Rights (which holder shall, with such notice, submit such
holder's Rights Certificate for inspection by the Company), then
the holder of any Rights may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any
successor Rights Agent, whether appointed by the Company or by
such a court, shall be a corporation organized and doing business
under the laws of the United States or of the State of Louisiana
or the State of New York, in good standing, having its principal
office in the State of Louisiana or the State of New York, which
is authorized under such laws to exercise the powers of the
Rights Agent contemplated by this Agreement and is subject to
supervision or examination by federal or state authority and
which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $50,000,000. After
appointment, the successor Rights Agent will 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 will
file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common Stock, and mail a notice
thereof in writing to the holders of the Rights. Failure to give
any notice provided for in this Section 4.4, however, or any
defect therein, shall not affect the legality or validity of the
resignation or removal of the Rights Agent or the appointment of
the successor Rights Agent, as the case may be.
ARTICLE V
MISCELLANEOUS
5.1 Redemption. (a) The Board of Directors of the
Company may, at its option, at any time prior to the close of
business on the Flip-in Date, elect to redeem all (but not less
than all) the then outstanding Rights at the Redemption Price and
the Company, at its option, may pay the Redemption Price either
in cash or shares of Common Stock or other securities of the
Company deemed by the Board of Directors, in the exercise of its
sole discretion, to be at least equivalent in value to the
Redemption Price.
(b) Immediately upon the action of the Board of
Directors of the Company electing to redeem the Rights (or, if
the resolution of the Board of Directors electing to redeem the
Rights states that the redemption will not be effective until the
occurrence of a specified future time or event, upon the
occurrence of such future time or event), without any further
action and without any notice, the right to exercise the Rights
will terminate and each Right will thereafter represent only the
right to receive the Redemption Price in cash or securities, as
determined by the Board of Directors. Promptly after the Rights
are redeemed, the Company shall give notice of such redemption to
the Rights Agent and the holders of the then outstanding Rights
by mailing such notice in accordance with Section 5.9.
5.2 Expiration. The Rights and this Agreement shall
expire at the Expiration Time and no Person shall have any rights
pursuant to this Agreement or any Right after the Expiration
Time, except, if the Rights are exchanged or redeemed, as
provided in Section 3.1(c), 3.1(d), 3.1(e), 3.2 or 5.1 hereof.
5.3 Issuance of New Rights Certificates. Not-
withstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new
Rights Certificates evidencing Rights in such form as may be
approved by its Board of Directors to reflect any adjustment or
change in the number or kind or class of shares of stock
purchasable upon exercise of Rights made in accordance with the
provisions of this Agreement. In addition, in connection with
the issuance or sale of shares of Common Stock by the Company
following the Separation Time and prior to the Redemption Time or
Expiration Time pursuant to the terms of securities convertible
or redeemable into shares of Common Stock or to options, in each
case issued or granted prior to, and outstanding at, the
Separation Time, the Company shall issue to the holders of such
shares of Common Stock, Rights Certificates representing the
appropriate number of Rights in connection with the issuance or
sale of such shares of Common Stock; provided, however, in each
case, (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 to the Person to whom such
Rights Certificates would be issued, (ii) no such Rights
Certificates shall be issued if, and to the extent that,
appropriate adjustment shall have otherwise been made in lieu of
the issuance thereof, and (iii) the Company shall have no
obligation to distribute Rights Certificates to any Acquiring
Person or Affiliate or Associate of an Acquiring Person or any
transferee of any of the foregoing.
5.4 Supplements and Amendments. The Company and the
Rights Agent may from time to time supplement or amend this
Agreement without the approval of any holders of Rights (i) prior
to the close of business on the Flip-in Date, in any respect and
(ii) after the close of business on the Flip-in Date, to make any
changes that the Company may deem necessary or desirable and
which shall not materially adversely affect the interests of the
holders of Rights generally or in order to cure any ambiguity or
to correct or supplement any provision contained herein which may
be inconsistent with any other provisions herein or otherwise
defective. The Rights Agent will duly execute and deliver any
supplement or amendment hereto requested by the Company which
satisfies the terms of the preceding sentence.
5.5 Fractional Shares. If the Company elects not to
issue certificates representing fractional shares upon exercise
or redemption of Rights, the Company shall, in lieu thereof, in
the sole discretion of the Board of Directors, either
(a) evidence such fractional shares by depositary receipts issued
pursuant to an appropriate agreement between the Company and a
depositary selected by it, providing that each holder of a
depositary receipt shall have all of the rights, privileges and
preferences to which such holder would be entitled as a
beneficial owner of such fractional share, or (b) sell such
shares on behalf of the holders of Right and pay to the
registered holder of such Rights the appropriate fraction of
price per share received upon such sale.
5.6 Rights of Action. Subject to the terms of this
Agreement (including Section 3.1(b)), rights of action in respect
of this Agreement, other than rights of action vested solely in
the Rights Agent, are vested in the respective holders of the
Rights; and any holder of any Rights, without the consent of the
Rights Agent or of the holder of any other Rights, may, on such
holder's own behalf and for such holder's own benefit and the
benefit of other holders of Rights, enforce, and may institute
and maintain any suit, action or proceeding against the Company
to enforce, or otherwise act in respect of, such holder's right
to exercise such holder's Rights in the manner provided in such
holder's 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 will be entitled to specific performance of
the obligations under, and injunctive relief against actual or
threatened violations of, the obligations of any Person subject
to this Agreement.
5.7 Holder of Rights Not Deemed a Stockholder. No
holder, as such, of any Rights shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of shares or
any other securities which may at any time be issuable on the
exercise of such Rights, nor shall anything contained herein or
in any Rights Certificate be construed to confer upon the holder
of any Rights, 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 5.8 hereof), or to
receive dividends or subscription rights, or otherwise, until
such Rights shall have been exercised or exchanged in accordance
with the provisions hereof.
5.8 Notice of Proposed Actions. In case the Company
shall propose after the Separation Time and prior to the
Expiration Time (i) to effect or permit (in cases where the
Company's permission is required) occurrence of any Flip-in Date
or Flip-over Transaction or Event or (ii) to effect the liqui-
dation, dissolution or winding up of the Company, then, in each
such case, the Company shall give to each holder of a Right, in
accordance with Section 5.9 hereof, a notice of such proposed
action, which shall specify the Flip-in Date or the date on which
such Flip-over Transaction or Event, liquidation, dissolution, or
winding up is to take place, and such notice shall be so given at
least 20 Business Days prior to the date of the taking of such
proposed action.
5.9 Notices. Notices or demands authorized or
required by this Agreement to be given or made by the Rights
Agent or by the holder of any Rights to or on the Company shall
be sufficiently given or made if delivered or sent by first-class
mail, postage prepaid, addressed (until another address is filed
in writing with the Rights Agent) as follows:
Avondale Industries, Inc.
5100 River Road
Avondale, Louisiana 70094
Attention: Secretary
Any notice or demand authorized or required by this Agreement to
be given or made by the Company or by the holder of any Rights to
or on the Rights Agent shall be sufficiently given or made if
delivered or sent by first-class mail, postage prepaid, addressed
(until another address is filed in writing with the Company) as
follows:
Boatmen's Trust Company
P. O. Box 14768
St. Louis, Missouri 63178
Attention: H. Eugene Bradford
Notices or demands authorized or required by this Agreement to be
given or made by the Company or the Rights Agent to or on the
holder of any Rights shall be sufficiently given or made if
delivered or sent by first-class mail, postage prepaid, addressed
to such holder at the address of such holder as it appears upon
the registry books of the Rights Agent or, prior to the
Separation Time, 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.
5.10 Suspension of Exercisability. To the extent that
the Company determines in good faith that some action will or
need be taken pursuant to Section 3.1(a), (b), (d) or (e) or to
comply with federal or state securities laws, the Company may
suspend the exercisability of the Rights for a period of up to
ninety (90) days following the date of the occurrence of the
Separation Time or the Flip-in Date in order to take such action
or comply with such laws. In the event of any such suspension,
the Company shall issue as promptly as practicable a public
announcement stating that the exercisability or exchangeability
of the Rights has been temporarily suspended. Notice thereof
pursuant to Section 5.9 shall not be required. Failure to give a
notice pursuant to the provisions of this Agreement shall not
affect the validity of any action taken hereunder.
5.11 Costs of Enforcement. The Company agrees that if
the Company or any other Person the securities of which are
purchasable upon exercise of Rights fails to fulfill any of its
obligations pursuant to this Agreement, then the Company or such
Person will reimburse the holder of any Rights for the costs and
expenses (including legal fees) incurred by such holder in
actions to enforce such holder's rights pursuant to any Rights or
this Agreement.
5.12 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.
5.13 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 holders of the Rights 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 holders of the Rights.
5.14 Determination and Actions by the Board of
Directors, etc. The Board of Directors of the Company shall have
the exclusive power and authority to administer this Agreement
and to exercise all rights and powers specifically granted to the
Board or to the Company, or as may be necessary or advisable in
the administration of this Agreement, including, without
limitation, the right and power to (i) interpret the provisions
of this Agreement and (ii) make all determinations deemed
necessary or advisable for the administration of this Agreement.
All such actions, calculations, interpretations and
determinations (including, for purposes of clause (y) below, all
omissions with respect to the foregoing) which are done or made
by the Board 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 of
Directors of the Company to any liability to the holders of the
Rights.
5.15 Descriptive Headings. Descriptive headings
appear herein for convenience only and shall not control or
affect the meaning or construction of any of the provisions
hereof.
5.16 Governing Law. THIS AGREEMENT AND EACH RIGHT
ISSUED HEREUNDER SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE
LAWS OF THE STATE OF LOUISIANA AND FOR ALL PURPOSES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF SUCH
STATE APPLICABLE TO CONTRACTS TO BE MADE AND PERFORMED ENTIRELY
WITHIN SUCH STATE.
5.17 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.
5.18 Severability. If any term or provision hereof or
the application thereof to any circumstance shall, in any
jurisdiction and to any extent, be invalid or unenforceable, such
term or provision shall be ineffective as to such jurisdiction to
the extent of such invalidity or unenforceability without
invalidating or rendering unenforceable the remaining terms and
provisions hereof or the application of such term or provision to
circumstances other than those as to which it is held invalid or
unenforceable.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the date first above written.
AVONDALE INDUSTRIES, INC.
By:
Thomas M. Kitchen
Vice President and
Chief Financial Officer
BOATMEN'S TRUST COMPANY
By:
Name:
Title:
EXHIBIT A
[Form of Rights Certificate]
Certificate No. W- _______ Rights
THE RIGHTS ARE SUBJECT TO REDEMPTION OR MANDATORY
EXCHANGE, AT THE OPTION OF THE COMPANY, ON THE
TERMS SET FORTH IN THE RIGHTS AGREEMENT. RIGHTS
BENEFICIALLY OWNED BY ACQUIRING PERSONS OR
AFFILIATES OR ASSOCIATES THEREOF (AS SUCH TERMS
ARE DEFINED IN THE RIGHTS AGREEMENT) OR
TRANSFEREES OF ANY OF THE FOREGOING WILL BE VOID.
Rights Certificate
AVONDALE INDUSTRIES, INC.
This certifies that ____________________, or registered
assigns, is the registered holder of the number of Rights set
forth above, each of which entitles the registered holder
thereof, subject to the terms, provisions and conditions of the
Stockholder Protection Rights Agreement, dated as of September
26, 1994 (as amended from time to time, the "Rights Agreement"),
between Avondale Industries, Inc., a Louisiana corporation (the
"Company"), and Boatmen's Trust Company, a Missouri corporation,
as Rights Agent (the "Rights Agent", which term shall include any
successor Rights Agent under the Rights Agreement), to purchase
from the Company at any time after the Separation Time (as such
term is defined in the Rights Agreement) and prior to the close
of business on October 10, 2004, one one-hundredth of a fully
paid share of Participating Preferred Stock, $1.00 par value (the
"Preferred Stock"), of the Company (subject to adjustment as
provided in the Rights Agreement) at the Exercise Price referred
to below, upon presentation and surrender of this Rights Certi-
ficate with the Form of Election to Exercise duly executed at the
principal office of the Rights Agent in St. Louis, Missouri. The
Exercise Price shall initially be $32.00 per Right and shall be
subject to adjustment in certain events as provided in the Rights
Agreement.
In certain circumstances described in the Rights
Agreement, the Rights evidenced hereby may entitle the registered
holder thereof to purchase securities of an entity other than the
Company or securities or assets of the Company other than
Preferred Stock, all as provided in the Rights Agreement.
This Rights Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities
hereunder of the Rights Agent, the Company and the holders of the
Rights Certificates. Copies of the Rights Agreement are on file
at the principal office of the Company and are available without
cost upon written request.
This Rights Certificate, with or without other Rights
Certificates, upon surrender at the office of the Rights Agent
designated for such purpose, may be exchanged for another Rights
Certificate or Rights Certificates of like tenor evidencing an
aggregate number of Rights equal to the aggregate number of
Rights evidenced by the Rights Certificate or Rights Certificates
surrendered. If this Rights Certificate shall be exercised in
part, the registered holder shall be entitled to receive, upon
surrender hereof, another Rights Certificate or Rights Certifi-
cates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, each
Right evidenced by this Certificate may be (a) redeemed by the
Company under certain circumstances, at its option, at a
redemption price of $0.01 per Right or (b) exchanged by the
Company under certain circumstances, at its option, for one share
of Common Stock or one one-hundredth of a share of Preferred
Stock per Right (or, in certain cases, other securities or assets
of the Company), subject in each case to adjustment in certain
events as provided in the Rights Agreement.
No holder of this Rights Certificate, as such, shall be
entitled to vote or receive dividends or be deemed for any
purpose the holder of any securities which may at any time be
issuable on the exercise hereof, nor shall anything contained in
the Rights Agreement or herein be construed to confer upon the
holder hereof, as such, any of the rights of a stockholder of the
Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting stock-
holders (except as provided in the Rights Agreement), or to
receive dividends or subscription rights, or otherwise, until the
Rights evidenced by this Rights Certificate shall have been
exercised or exchanged 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.
<PAGE>
WITNESS the facsimile signature of the proper officers
of the Company and its corporate seal.
Date: ____________
ATTEST: AVONDALE INDUSTRIES, INC.
By:
Secretary President
Countersigned:
BOATMEN'S TRUST COMPANY
By:
Authorized Signature
<PAGE>
[[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer this 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 Company, with full
power of substitution.
Dated: _______________, ____
Signature Guaranteed: ______________________________
Signature
(Signature must correspond to
name as written upon the face
of this Rights Certificate in
every particular, without
alteration or enlargement or
any change whatsoever)
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or
trust company having an office or correspondent in the United
States.
-----------------------------------------------------------------
(To be completed if true)
The undersigned hereby represents, for the benefit of all holders
of Rights and shares of Common Stock, that the Rights evidenced
by this Rights Certificate are not, and, to the knowledge of the
undersigned, have never been, Beneficially Owned by an Acquiring
Person or an Affiliate or Associate thereof (as defined in the
Rights Agreement).
______________________________
Signature
-----------------------------------------------------------------
NOTICE
______
In the event the certification set forth above is not
completed in connection with a purported assignment, the Company
will deem the Beneficial Owner of the Rights evidenced by the
enclosed Rights Certificate to be an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights
Agreement) or a transferee of any of the foregoing and
accordingly will deem the Rights evidenced by such Rights
Certificate to be void and not transferable or exercisable.
[To be attached to each Rights Certificate]
FORM OF ELECTION TO EXERCISE
(To be executed if holder desires to
exercise the Rights Certificate.)
TO: AVONDALE INDUSTRIES, INC.
The undersigned hereby irrevocably elects to exercise
_______________________ whole Rights represented by the attached
Rights Certificate to purchase the shares of Participating
Preferred Stock issuable upon the exercise of such Rights and
requests that certificates for such shares be issued in the name
of:
_________________________________
Address: _______________________
_________________________________
Social Security or Other Taxpayer
Identification Number:___________
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: _________________________________
Address _________________________
_________________________________
Social Security or Other Taxpayer
Identification Number: __________
Dated: _______________, ____
Signature Guaranteed: ______________________________
Signature
(Signature must correspond to
name as written upon the face
of the attached Rights
Certificate in every
particular, without alteration
or enlargement or any change
whatsoever)
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or
trust company having an office or correspondent in the United
States.
-----------------------------------------------------------------
(To be completed if true)
The undersigned hereby represents, for the benefit of
all holders of Rights and shares of Common Stock, that the Rights
evidenced by the attached Rights Certificate are not, and, to the
knowledge of the undersigned, have never been, Beneficially Owned
by an Acquiring Person or an Affiliate or Associate thereof (as
defined in the Rights Agreement).
______________________________
Signature
-----------------------------------------------------------------
NOTICE
In the event the certification set forth above is not
completed in connection with a purported exercise, the Company
will deem the Beneficial Owner of the Rights evidenced by the
attached Rights Certificate to be an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights
Agreement) or a transferee of any of the foregoing and
accordingly will deem the Rights evidenced by such Rights
Certificate to be void and not transferable or exercisable.
EXHIBIT B
FORM OF ARTICLES OF AMENDMENT TO THE
ARTICLES OF INCORPORATION OF AVONDALE INDUSTRIES, INC.
Avondale Industries, Inc., a Louisiana corporation (the
"Corporation"), by and through its undersigned President and
Secretary and by authority of its Board of Directors, does hereby
certify that:
1. At a meeting held on September 26, 1994, the
Corporation's Board of Directors, pursuant to Section 33A of the
Business Corporation Law of Louisiana (the "LBCL") and Article
III of the Articles of Incorporation of the Corporation (the
"Articles of Incorporation"), adopted the following amendment to
Article III of the Articles of Incorporation (the "Articles of
Amendment") to establish and fix the preferences, limitations and
relative rights of a series of preferred stock, and authorized
the execution and delivery of these Articles of amendment to the
Secretary of State for filing pursuant to Section 32B of the
LBCL.
2. Article III of the Articles of Incorporation is
amended to add Paragraph D to read in its entirety as follows:
D. a series of preferred stock of the Corporation is
hereby established, having the preferences, limitations and
relative rights set forth below:
(1) The distinctive serial designation of this
series shall be "Participating Preferred Stock"
(hereinafter called "this Series"). Each share of this
Series shall be identical in all respects with the
other shares of this Series except as to the dates from
and after which dividends thereon shall be cumulative.
(2) The number of shares in this Series shall
initially be 1,000,000, which number may from time to
time be increased or decreased (but not below the
number then outstanding) by the Board of Directors.
Shares of this Series purchased by the Corporation
shall be cancelled and shall revert to authorized but
unissued shares of Preferred Stock undesignated as to
series. Shares of this Series may be issued in
fractional shares, which fractional shares shall
entitle the holder, in proportion to such holder's
fractional share, to all rights of a holder of a whole
share of this Series.
(3) The holders of full or fractional shares of
this Series shall be entitled to receive, when and as
declared by the Board of Directors, but only out of
funds legally available therefor, dividends, (A) on
each date that dividends or other distributions (other
than dividends or distributions payable in Common Stock
of the Corporation) are payable on or in respect of
Common Stock comprising part of the Reference Package
(as defined below), in an amount per whole share of
this Series equal to the aggregate amount of dividends
or other distributions (other than dividends or
distributions payable in Common Stock of the
Corporation) that would be payable on such date to a
holder of the Reference Package and (B) on the last day
of March, June, September and December in each year, in
an amount per whole share of this Series equal to the
excess (if any) of $8.00 over the aggregate dividends
paid per whole share of this Series during the three
month period ending on such last day. Each such
dividend shall be paid to the holders of record of
shares of this Series on the date, not exceeding sixty
days preceding such dividend or distribution payment
date, fixed for the purpose by the Board of Directors
in advance of payment of each particular dividend or
distribution. Dividends on each full and each
fractional share of this Series shall be cumulative
from the date such full or fractional share is
originally issued; provided that any such full or
fractional share originally issued after a dividend
record date and on or prior to the dividend payment
date to which such record date relates shall not be
entitled to receive the dividend payable on such
dividend payment date or any amount in respect of the
period from such original issuance to such dividend
payment date.
The term "Reference Package" shall initially
mean 100 shares of Common Stock, $1.00 par value
("Common Stock"), of the Corporation. In the event the
Corporation shall at any time after the close of
business on September 26, 1994 (A) declare or pay a
dividend on any Common Stock payable in Common Stock,
(B) subdivide any Common Stock or (C) combine any
Common Stock into a smaller number of shares, then and
in each such case the Reference Package after such
event shall be the Common Stock that a holder of the
Reference Package immediately prior to such event would
hold thereafter as a result thereof.
Holders of shares of this Series shall not be
entitled to any dividends, whether payable in cash,
property or stock, in excess of full cumulative
dividends, as herein provided on this Series.
So long as any shares of this Series are
outstanding, no dividend (other than a dividend in
Common Stock or in any other stock ranking junior to
this Series as to dividends and upon liquidation) shall
be declared or paid or set aside for payment or other
distribution declared or made upon the Common Stock or
upon any other stock ranking junior to this Series as
to dividends or upon liquidation, nor shall any Common
Stock nor any other stock of the Corporation ranking
junior to or on a parity with this Series as to
dividends or upon liquidation be redeemed, purchased or
otherwise acquired for any consideration (or any moneys
be paid to or made available for a sinking fund for the
redemption of any shares of any such stock) by the
Corporation (except by conversion into or exchange for
stock of the Corporation ranking junior to this Series
as to dividends and upon liquidation), unless, in each
case, the full cumulative dividends (including the
dividend to be due upon payment of such dividend,
distribution, redemption, purchase or other
acquisition) on all outstanding shares of this Series
shall have been, or shall contemporaneously be, paid.
(4) In the event of any merger, consolidation,
reclassification or other transaction in which the
shares of Common Stock are exchanged for or changed
into other stock or securities, cash and/or any other
property, then in any such case the shares of this
Series shall at the same time be similarly exchanged or
changed in an amount per whole share equal to the
aggregate amount of stock, securities, cash and/or any
other property (payable in kind), as the case may be,
that a holder of the Reference Package would be
entitled to receive as a result of such transaction.
(5) In the event of any liquidation, dissolution
or winding up of the affairs of the Corporation,
whether voluntary or involuntary, the holders of full
and fractional shares of this Series shall be entitled,
before any distribution or payment is made on any date
to the holders of the Common Stock or any other stock
of the Corporation ranking junior to this Series upon
liquidation, to be paid in full an amount per whole
share of this Series equal to the greater of (A) an
amount equal to 100 times the Exercise Price in effect
as of the Separation Time (as such terms are defined in
the Stockholder Protection Rights Agreement dated as of
September 26, 1994 between the Company and Boatmen's
Trust Company, as Rights Agent) or (B) the aggregate
amount distributed or to be distributed prior to such
date in connection with such liquidation, dissolution
or winding up to a holder of the Reference Package
(such greater amount being hereinafter referred to as
the "Liquidation Preference"), together with accrued
dividends to such distribution or payment date, whether
or not earned or declared. If such payment shall have
been made in full to all holders of shares of this
Series, the holders of shares of this Series as such
shall have no right or claim to any of the remaining
assets of the Corporation.
In the event the assets of the Corporation
available for distribution to the holders of shares of
this Series upon any liquidation, dissolution or
winding up of the Corporation, whether voluntary or
involuntary, shall be insufficient to pay in full all
amounts to which such holders are entitled pursuant to
the first paragraph of this Section (5), no such
distribution shall be made on account of any shares of
any other class or series of Preferred Stock ranking on
a parity with the shares of this Series upon such
liquidation, dissolution or winding up unless
proportionate distributive amounts shall be paid on
account of the shares of this Series, ratably in
proportion to the full distributable amounts for which
holders of all such parity shares are respectively
entitled upon such liquidation, dissolution or winding
up.
Upon the liquidation, dissolution or winding
up of the Corporation, the holders of shares of this
Series then outstanding shall be entitled to be paid
out of assets of the Corporation available for
distribution to its stockholders all amounts to which
such holders are entitled pursuant to the first
paragraph of this Section (5) before any payment shall
be made to the holders of Common Stock or any other
stock of the Corporation ranking junior upon
liquidation to this Series.
For the purposes of this Section (5), the
consolidation or merger of, or binding share exchange
by, the Corporation with any other corporation shall
not be deemed to constitute a liquidation, dissolution
or winding up of the Corporation.
(6) The shares of this Series shall not be
redeemable.
(7) In addition to any other vote or consent of
stockholders required by law or by the Articles of
Incorporation, as amended, of the Corporation, each
whole share of this Series shall, on any matter, vote
as a class with any other capital stock comprising part
of the Reference Package and voting on such matter and
shall have the number of votes thereon that a holder of
the Reference Package would have.
IN WITNESS WHEREOF, the undersigned President and
Secretary have signed these Articles of Amendment on the ____ day
of _________, ____ at _________ Louisiana.
AVONDALE INDUSTRIES, INC.
By:
Albert L. Bossier, Jr.
President
By:
Thomas M. Kitchen
Secretary
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ACKNOWLEDGEMENT
STATE OF LOUISIANA
PARISH OF JEFFERSON
BEFORE ME, the undersigned authority, personally came
and appeared Albert L. Bossier, Jr. and Thomas M. Kitchen, to me
known to be the President and Secretary, respectively, of
Avondale Industries Inc., a Louisiana corporation, and the
persons who executed the foregoing Articles of Amendment in such
capacities, and who, being duly sworn, acknowledged and declared
in my presence and in the presence of the undersigned witnesses
that they were authorized to and did execute the foregoing
instrument in such capacities for the said Corporation as its and
their free act and deed.
IN WITNESS WHEREOF, the appearers, witnesses and I have
hereunto affixed our signatures on this __ day of ______________,
1994.
WITNESSES:
Albert L. Bossier, Jr.,
President
Thomas M. Kitchen
Secretary
NOTARY PUBLIC
