SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________
POST-EFFECTIVE AMENDMENT NO. 1
FORM 8-A/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:
Common Stock, $1.00 par value per share
(Title of Class)
Item 1. Description of Registrant's Securities to be Registered
General
The following summary description is qualified in its
entirety by reference to the Company's Articles of Incorporation,
as amended (the "Articles") which are incorporated by reference
as Exhibit 1. The Company is authorized by its Articles to issue
30,000,000 shares of Common Stock, $1.00 par value per share, and
5,000,000 shares of Preferred Stock, $1.00 par value per share.
Preferred Stock
The Board of Directors is authorized to amend the Articles,
without further action by the Company's shareholders, to issue
Preferred Stock from time to time in one or more series and to
fix, as to any such series, the voting rights, if any, applicable
to such series and such other preferences, limitations and
relative rights as the Board of Directors may determine,
including dividend, conversion, redemption and liquidation rights
and preferences. As of December 31, 1995, there were no shares
of Preferred Stock outstanding.
Pursuant to a Stockholder Protection Rights Agreement, dated
as of September 26, 1994, the Board of Directors created a series
of preferred stock designated the "Participating Preferred
Stock". The Participating Preferred Stock may be issued as
contemplated in the Stockholder Protection Rights Agreement, a
description of which is incorporated herein by reference to Item
1 of the Company's Form 8-A dated September 30, 1994, a copy of
which appears on Exhibit 5 hereto. One one-hundredth of a share
of Participating Preferred Stock is designed to be substantially
equivalent to one share of the Company's Common Stock.
Rights
The description of the Rights issued pursuant to the
Stockholder Protection Rights Agreement, dated as of September
26, 1994, is incorporated herein by reference to Item 1 of the
Company's Form 8-A dated September 30, 1994, a copy of which
appears as Exhibit 5 hereto.
Common Stock
As of December 1, 1995, all issued shares of the Company's
Common Stock were fully paid and non-assessable. Unissued shares
of the Company's Common Stock, if issued in compliance with the
Louisiana Business Corporation Law (the "LBCL"), will be fully
paid and non-assessable. Subject to the Louisiana Control Share
Acquisition Statute described below, all holders of Common Stock
are entitled to one vote for each share of Common Stock held of
record on all matters on which shareholders are entitled to vote.
Subject to preferences accorded to the holders of the Preferred
Stock, holders of Common Stock are entitled to dividends at such
times and in such amounts as the Board of Directors shall
determine. Upon the dissolution, liquidation or winding up of
the Company, after payment of debts and expenses and payment of
the liquidation preference plus any accrued dividends on
outstanding shares of Preferred Stock, the holders of Common
Stock will be entitled to receive all remaining assets of the
Company ratably in proportion to the number of shares held by
them. Holders of shares of Common Stock have no preemptive,
subscription, cumulative voting, conversion or redemption rights,
and the Common Stock is not subject to mandatory redemption by
the Company.
As of December 1, 1995, the Company's Employee Stock
Ownership Plan (the "ESOP") Trust owned approximately 47.3% of
the Company's outstanding Common Stock and virtually all of the
shares held in the ESOP Trust had been allocated to the accounts
of the participants. In general, ESOP participants have the
right to direct the ESOP Trustee how to vote, or whether to
tender, shares allocated to their accounts.
One of the effects of the existence of authorized but
unissued Common Stock and undesignated Preferred Stock of the
Company may be to enable the Board of Directors to make more
difficult or to discourage an attempt to obtain control of the
Company by means of a merger, tender offer, proxy contest or
otherwise. If, in the due exercise of its fiduciary obligations,
the Board of Directors were to determine that a takeover proposal
was not in the Company's best interest, such shares could be
issued by the Board of Directors without shareholder approval in
one or more transactions that might prevent or render more
difficult or costly the completion of the takeover transaction by
diluting the voting or other rights of the proposed acquiror or
insurgent shareholder group, by putting a substantial voting
block in institutional or other hands that might undertake to
support the decision of the incumbent Board of Directors, by
effecting an acquisition that might complicate or preclude the
takeover, or otherwise.
Certain Provisions of the Articles of Incorporation and By-
laws. Certain provisions of the Articles and By-laws, which are
described below, may have the effect, either alone, in
combination with each other or with the existence of authorized
but unissued capital stock, of making more difficult or
discouraging an acquisition of the Company deemed undesirable by
the Board of Directors.
Classified Board of Directors. The Articles and By-laws
divide the members of the Board of Directors who are elected by
the holders of the Common Stock into three classes serving three-
year staggered terms.
Advance Notice of Intention to Nominate a Director. The
Articles and By-laws permit a shareholder to nominate a person
for election as a director only if written notice of such
shareholder's intent to make a nomination has been given to the
Secretary of the Company not less than 45 days or more than 90
days prior to the meeting. However, if less than 55 days notice
or prior public disclosure of the date of the meeting is given to
shareholders, notice of the shareholder's intention to nominate a
director must be received no later than the close of business on
the tenth day following the day such notice was mailed or public
disclosure was made. The shareholder's notice must set forth,
among other things, such information regarding the nominee as
would be required to be included in a proxy statement filed
pursuant to the proxy rules promulgated under the Securities
Exchange Act of 1934 had the nominee been nominated by the Board
of Directors of the Company. Additional information about the
nominating shareholder, as set forth in the Articles, must also
be provided. Any shareholder nomination that fails to comply
with these requirements may be disqualified.
Supermajority and Fair Price Provisions. The Company's
Articles contain certain provisions designed to provide
safeguards for shareholders when a Related Person (as defined
below) attempts to effect a Business Combination (as defined
below) with the Company. In general, a Business Combination
between the Company and a Related Person must be approved by the
Board of Directors prior to the time the Related Person became a
Related Person unless certain minimum price and procedural
requirements are satisfied. Furthermore, a Business Combination
must be approved by the affirmative vote of 80% of the total
voting power excluding the voting power of all voting securities
beneficially owned by the acquiring entity, at a shareholders'
meeting called for that purpose. The Business Combination also
must be approved by the vote of the holders of any class or
series of the Company's stock otherwise required by law or the
Articles. These provisions may be amended only by the
affirmative vote of 80% of the total voting power excluding the
voting power of all voting securities beneficially owned by any
Related Person.
For purposes of these provisions, a "Related Person" is
defined as any person or entity, or any group of two or more
persons or entities acting in concert, that is the beneficial
owner, directly or indirectly, of 10% or more of the total voting
power, other than the Company, any wholly-owned subsidiary of the
Company, any employee stock ownership or other employee benefit
plan of the Company or of any wholly-owned subsidiary of the
Company, or any trustee of, or fiduciary with respect to, any
such plan when acting in such capacity.
The term "Business Combination" means:
(i) any merger or consolidation of the
Company with or into a Related Person;
(ii) any sale, lease, exchange or other
disposition (in one transaction or a series
of related transactions) of all or
substantially all of the assets of the
Company to a Related Person;
(iii) any sale, lease, exchange or other
disposition (in one transaction or a series
of related transactions) to the Company or
any subsidiary of the Company of any assets
in exchange for which the Related Person
becomes the beneficial owner of either (a)
voting securities (or securities convertible
into or exchangeable for voting securities,
or options, warrants or rights to purchase
voting securities or securities convertible
into or exchangeable for voting securities)
of the Company or any subsidiary of the
Company or (b) bonds, debentures or other
obligations of the Corporation having voting
rights;
(iv) any reclassification of securities,
recapitalization or other transaction
designed to increase, or which has the effect
of increasing, the proportionate amount of
voting securities (or securities convertible
into or exchangeable for voting securities,
or offers, warrants or rights to purchase
voting securities convertible into or
exchangeable for voting securities) of the
Company that are held by the Related Person;
(v) the issuance or transfer by the
Company or any subsidiary of the Company (in
one or more issuances or a series of related
issuances or transfers) of any securities of
the Company or any subsidiary of the Company
to any Related Person in exchange for cash,
securities or other property having a fair
market value of not less than one percent of
the total market value of all outstanding
shares of the Company's Common Stock as of
the close of business of the day immediately
preceding the day of the issuance or
transfer, or
(vi) the adoption of any plan or
proposal for the liquidation or dissolution
of the Company in which anything other than
cash will be received by a Related Person or
any of its affiliates.
Shareholders' Right to Call Special Meeting. The Articles
and By-laws provide that a special shareholders' meeting may be
required by a shareholder or group of shareholders holding in the
aggregate at least 80% of the Company's total voting power.
Removal of Directors; Filling Vacancies on Board of
Directors. The Articles and By-laws provide that any director
elected by holders of the Common Stock may be removed, only for
cause, by a vote of not less than 80% of the total voting power
at any meeting of shareholders called for such purpose. "Cause"
is defined in the Articles to mean either (i) a conviction of a
director by a court of competent jurisdiction of a felony
involving moral turpitudes of such conviction is no longer
subject to direct appeal or (ii) on adjudication by a court of
competent jurisdiction of liability for gross negligence or
misconduct in the performance of a director's duty to the Company
in a matter of substantial importance to the Company if such
adjudication is no longer subject to direct appeal. The Articles
and By-laws also provide that any vacancies on the Board of
Directors (including any resulting from an increase in the
authorized number of directors) may be filled by the affirmative
vote of at least two-thirds of the entire Board provided that at
any time during which there is a Related Person such action also
requires the vote of at least two-thirds of the total number of
Continuing Directors, defined below, provided that the
shareholders have the right, at any special meeting called for
that purpose prior to such action by the Board, to fill the
vacancy. A director elected to fill a vacancy serves until the
next shareholders' meeting held for the election of directors of
the class to which the director has been elected. A "Continuing
Director" is defined as (i) any member of the Board of Directors
who is neither a Related Person nor an affiliate or associate
thereof, and who was a director of the Company prior to the time
that the Related Person became a Related Person; and (ii) any
other member of the Board of Directors whose nomination or
election was approved by a majority of the Continuing Directors
then in office either by a specific vote or by approval of the
proxy statement issued by the Company on behalf of the Board of
Directors in which such person is named as a proposed nominee for
director.
Adoption and Amendment of By-laws. The Articles and By-laws
provide that the By-laws may be adopted only by a majority of the
entire Board of Directors when there is no Related Person or by
both a majority of the entire Board of Directors and a majority
of the Continuing Directors at any time when there is a Related
Person. By-laws may be amended or repealed only by (i) a
majority of the entire Board of Directors when there is no
Related Person (except any amendment to or repeal of a by-law
concerning the removal of a director requires an affirmative vote
of at least three quarters of the entire Board of Directors), or
(ii) both a majority of the entire Board and a majority of the
Continuing Directors at any time when there is a Related Person
or (iii) the affirmative vote of the holders of at least 80% of
the total voting power at any shareholders' meeting the notice of
which states that the amendment or repeal is to be considered at
the meeting. Any purported amendment to the By-laws that would
add a matter not expressly covered by the By-laws prior to such
amendment will be deemed the adoption of a new By-law and not an
amendment.
Special Shareholder Voting Requirements. Except as
otherwise specifically provided in the Articles, an amendment to
the Articles must be approved by the affirmative vote of at least
80% of the total voting power if the amendment has not been
recommended by at least a majority of the members of the Board
when there is no Related Person or by a majority of the
Continuing Directors when there is a Related Person. If the
amendment has been so recommended, it must be approved by the
affirmative vote of a majority of the voting power present at a
shareholders' meeting, unless otherwise specifically provided in
the Articles. Except as provided in the supermajority and fair
price provisions of the Articles, the affirmative vote of the
holders of a majority of the total voting power is necessary to
constitute shareholder approval whenever such approval is
required by law for a merger, consolidation, sale of assets or
dissolution of the Company.
Consideration of Tender Offers and Other Extraordinary
Transactions. As permitted by Louisiana law, the Articles
expressly authorize the Board of Directors, when considering a
tender offer, exchange offer, merger or consolidation, to
consider, among other factors, the social and economic effects of
the proposal on the Company and its employees, customers,
creditors and the communities in which it does business.
Limitation of Liability and Indemnification. The Articles
provide that to the fullest extent permitted by the LBCL, no
director or officer of the Company will be liable to the Company
or to its shareholders for monetary damages for breach of his or
her fiduciary duty as a director or officer. The Articles also
provide that the Board may (i) cause the Company to enter into
contracts with directors and officers providing for the
limitation of liability provided in the Articles and for
indemnification of directors and officers to the fullest extent
permitted by law, (ii) adopt by-laws or resolutions providing
indemnification of directors, officers and other persons to the
fullest extent permitted by law, and (iii) cause the Company to
exercise certain powers set forth in the LBCL relating to
insurance, notwithstanding that some or all of the members of the
Board acting with respect to the foregoing may be parties to such
contracts or beneficiaries of such by-laws or resolutions. These
provisions of the Articles may only be amended by the affirmative
vote of at least 80% of the total voting power and any amendment
or repeal may not adversely affect any limitation of liability of
a director or officer with respect to action or inaction
occurring prior to the amendment or repeal. The Company's By-
laws provide that the Company will indemnify to the full extent
permitted by law any person made or threatened to be made a party
to any action, suit or proceeding by reason of the fact that such
person is or was a director, officer or employee of the Company
or served at the request of the Company as a director, officer or
employee of any other enterprise.
Louisiana Control Share Acquisition Statute. The Louisiana
Control Share Acquisition Statute provides that any shares
acquired by a person or group (an "Acquiror") in an acquisition
that causes such person or group to have the power to direct the
exercise of voting power in the election of directors in excess
of 20%, 33 1/3% or 50% thresholds will have only such voting
power as shall be accorded by (i) the holders of a majority of
all shares other than "interested shares," as defined below, and
(ii) a majority of the total voting power. "Interested shares"
include all shares as to which the Acquiror, any officer of the
Company and any director of the Company who is also an employee
of the Company may exercise or direct the exercise of voting
power. The statute permits the articles of incorporation or by-
laws of a company to exclude from the statute's application
acquisitions occurring after the adoption of the exclusion. As
of December 1, 1995, the Company's Articles and By-laws did not
contain such an exclusion.
Louisiana Fair Price Protection Statute. The Articles
provide that the Company claims the benefits of the Louisiana
Fair Price Protection Statute, provided that the statute will not
apply to any business combination, as defined in such statute,
involving the Company's ESOP.
The Louisiana Fair Price Protection Statute requires that
any "business combination" (defined to include a merger,
consolidation, share exchange, certain asset distributions and
certain issuances of securities) with a shareholder who is the
beneficial owner of 10% or more of the voting power of the
outstanding voting stock of the Company (an "interested
shareholder"), or an affiliate of an interested shareholder, be
recommended by the Board of Directors. Additionally, the
business combination must be approved by the affirmative vote of
at least (i) 80% of the votes entitled to be cast by outstanding
shares of voting stock of the Company voting together as a single
voting group, and (ii) two-thirds of the votes entitled to be
cast by holders of voting stock other than voting stock held by
the interested shareholder who is, or whose affiliate is, a party
to the business combination or an affiliate or associate of the
interested shareholder, voting together as a single group. These
votes are not required if certain minimum price, form of
consideration and procedural requirements are satisfied by the
interested shareholder, or if the Board approves the business
combination before the interested shareholder becomes such.
Louisiana Employee Benefit Plan Protection Statute.
Sections 130 through 130.2 of the LBCL may have the effect of
deterring a takeover of a Louisiana corporation with a large
pension plan such as the Company's ESOP. While the statute has
not been interpreted by a court, it may impose liability on any
person responsible for losses suffered by an employee benefit
fund as a result of transactions occurring during a two-year
period following a change in the majority voting ownership of a
Louisiana corporation.
Item 2. Exhibits
Exhibit Numbers Description
- --------------- -----------
1 Articles of Incorporation of the Company, <F1> as
amended on December 21, 1995.
2 By-laws of the Company. <F2>
3 Stockholder Protection Rights Agreement dated September
26, 1994, between the Company and Boatmen's Trust
Company, as Rights Agent. <F3>
4 Description of the Stockholder Protection Rights
Agreement included as Item 1 of the Company's Form 8-A
dated September 30, 1994.
______________________
[FN]
<F1> Incorporated by reference from the Company's Quarterly Report on Form
10-Q for the fiscal quarter ended June 30, 1993, and as modified on
the Company's for 8-A dated September 30, 1994.
<F2> Incorporated by reference from the Company's Quarterly Report on Form
10-Q for the fiscal quarter ended June 30, 1995.
<F3> Incorporated by reference from the Company's Current Report on Form
8-K filed with the Commission on September 30, 1994.
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this
Amendment 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: December 21, 1995
EXHIBIT LIST
1 Articles of Incorporation of the Company, <F1> as
amended on December 21, 1995.
2 By-laws of the Company. <F2>
3 Stockholder Protection Rights Agreement dated September
26, 1994, between the Company and Boatmen's Trust
Company, as Rights Agent. <F3>
4 Description of the Stockholder Protection Rights
Agreement included as Item 1 of the Company's Form 8-A
dated September 30, 1994.
______________________
[FN]
<F1> Incorporated by reference from the Company's Quarterly Report on Form
10-Q for the fiscal quarter ended June 30, 1993, and as modified on
the Company's for 8-A dated September 30, 1994.
<F2> Incorporated by reference from the Company's Quarterly Report on Form
10-Q for the fiscal quarter ended June 30, 1995.
<F3> Incorporated by reference from the Company's Current Report on Form
8-K filed with the Commission on September 30, 1994.
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. By a unanimous consent of the Corporation's Board
of Directors dated May 20, 1993, the Board of Directors, adopted
amendments to Article III of the Articles of Incorporation (the
"Articles of Amendment") 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"), establishing the Series A Cumulative Convertible
Preferred Stock and Series B Cumulative Preferred Stock.
2. The Corporation has not issued any shares of the
Series A Cumulative Convertible Preferred Stock or the Series B
Cumulative Preferred Stock, and no shares of either are
outstanding.
3. By the unanimous written consent of the Board of
Directors, the Board of Directors, pursuant to Section 33A of the
LBCL and Article III of the Articles of Incorporation, the Board
of Directors has resolved that the Article III of the Articles of
Incorporation be amended to remove Sections D and E of Article
III, in their entirety and to redesignate Paragraph F as
Paragraph D.
IN WITNESS WHEREOF, the undersigned President and Secretary
have signed these Articles of Amendment on the 21st day of
December, 1995, at Avondale, Louisiana.
AVONDALE INDUSTRIES, INC.
By: /s/ Albert L. Bossier, Jr.
________________________________
Albert L. Bossier, Jr.,
President
By: /s/ Thomas M. Kitchen
________________________________
Thomas M. Kitchen,
Secretary
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 21st day of December,
1995.
WITNESSES:
/s/Jackie H. Walker /s/ Albert L. Bossier, Jr.
________________________ _____________________________
Albert L. Bossier, Jr.,
President
/s/Bruce L. Hicks /s/ Thomas M. Kitchen
________________________ _____________________________
Thomas M. Kitchen,
Secretary
/s/Andy Blomkalns
____________________________
NOTARY PUBLIC
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.
