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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
ANGELES MORTGAGE INVESTMENT TRUST
(Exact name of registrant as specified in its charter)
California 95-6890805
- ---------- ----------
(State of incorporation or organization) (I.R.S. Identification No.)
340 North Westlake Boulevard, Suite 230
Westlake Village, CA 91362
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(Address of principal executive offices) (Zip Code)
If this Form relates to the registration of a class of debt securities
and is effective upon filing pursuant to General Instruction A(c)(1), please
check the following box. [ ]
If this form relates to the registration of a class of debt securities
and is to become effective simultaneously with the effectiveness of a concurrent
registration statement under the Securities Act of 1933 pursuant to the General
Instruction (A(c)(2), please check the following box. [ ]
Securities to be registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Each Exchange on Which
to be so Registered Each Class is to be Registered
- ------------------- ------------------------------
Class A Shares Purchase Rights American Stock Exchange
Securities to be registered pursuant to Section 12(g) of the Act:
None
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ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED
On November 12, 1996, the Trustees of Angeles Mortgage Investment Trust
(the "Company") authorized the distribution of one Right for each outstanding
Class A Share of the Company ("Class A Shares"). The distribution is to be made
to the stockholders of record on November 18, 1996 (the "Record Date") and, in
addition, the Company has authorized the issuance of one Right with respect to
each Class A Share that shall become outstanding between the Record Date and the
earliest of the Distribution Date, the Redemption Date or the Final Expiration
Date (as such terms are hereinafter defined). When exercisable, each Right
entitles the registered holder to purchase from the Company one Class A Share
(or other shares, securities or property, as the case may be, of equivalent
value) at the initial price of $60.00 per Share (the "Purchase Price"), subject
to adjustment. However, if a person becomes an Acquiring Person (as hereinafter
defined) holders (other than Acquiring Persons) can exercise at a price equal to
one-half of the market value of the Class A Shares. The description and terms of
the rights are set forth in a Rights Agreement (the "Rights Agreement") between
the Company and Chase Mellon Shareholder Services, L.L.C. (the "Rights Agent").
Initially, the Rights will be evidenced by the certificates
representing Class A Shares then outstanding, no separate Right Certificates
will be distributed and the Rights will not be tradeable separate from the Class
A Shares. The Rights will become exercisable and will separate from the Class A
Shares upon the earlier of (i) ten business days after a public announcement
that a person or group of affiliated or associated persons (an "Acquiring
Person") has acquired beneficial ownership of 20% or more of the outstanding
Class A Shares (the "Share Acquisition Date") or (ii) ten business days (or a
later date as determined by the Trustees) after the commencement of, or first
public announcement of an intention to commence, a tender offer or exchange
offer that would result in a person or group beneficially owning 20% or more of
the outstanding Class A Shares (the earlier of such dates being called the
"Distribution Date").
Until the Distribution Date (or earlier redemption or expiration of the
Rights), (i) the Rights will be evidenced by the Class A Share certificates and
will be transferred with and only with such Class A Share certificate, (ii) new
Class A Share certificates issued after the Record
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Date will contain in accordance with the Rights Agreement a notation
incorporating the Rights Agreement by reference, and (iii) the surrender or
transfer of any certificates for Class A Shares outstanding will also constitute
the transfer of the Rights associated with the Class A Shares represented by
such certificate.
The Rights are not exercisable until the Distribution Date and will
expire at the close of business on December 31, 2003 (the "Final Expiration
Date"), unless the Final Expiration Date is extended or the Rights are earlier
redeemed or exchanged by the Company as described below.
As soon as practicable after the Distribution Date, Right Certificates
will be mailed to holders of record of the Class A Shares as of the close of
business on the Distribution Date, and thereafter, the separate Right
Certificates alone will represent the Rights. Only Class A Shares issued prior
to the Distribution Date will be issued with Rights.
In the event that a Person becomes an Acquiring Person, each holder of
a Right will thereafter have the right to receive, upon exercise, Class A Shares
(or in certain circumstances cash, property or other securities of the Company)
having a value equal to two times the Purchase Price of the Right.
Notwithstanding the foregoing, following the occurrence of such an event, all
Rights that are or (under certain circumstances specified in the Rights
Agreement) were beneficially owned by any Acquiring Person will be null and
void.
After the Share Acquisition Date, in the event that (i) the Company
consolidates or merges with any other person and the Company is not the
surviving corporation; (ii) any person engages in a share exchange,
consolidation or merger with the company were the outstanding Class A Shares are
exchanged for securities, cash or property of the other person and the Company
is the surviving corporation; or (iii) 50% or more of the Company's assets or
earning power is sold or transferred, proper provision will be made so that each
holder of a Right (other than Rights owned by an Acquiring Person, which will
have become null and void) will thereafter have the right to receive, upon
exercise, common stock of the acquiring company having a value equal to two
times the Purchase Price of the Right.
The Purchase Price payable, and the number of Class A Shares or other
securities, cash or property issuable, upon exercise of the Rights are subject
to customary adjustments from time to time to prevent dilution in the event of
certain changes in the shares of the Company. With
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certain exceptions, no adjustment in the Purchase Price will be required until
cumulative adjustments amount to an increase or decrease of at least 1% in the
Purchase Price. The Company may determine not to issue fractional Rights or
shares, and in lieu thereof, an adjustment in cash will be made based on the
market value of the Rights or shares on the last trading date prior to the date
of exercise.
In general, the Company may redeem the Rights in whole, but not in
part, at a price of $.01 per Right (subject to adjustment) (the "Redemption
Price"), at any time before the close of business on the tenth business day
following the Share Acquisition Date. The redemption of the Rights may be made
effective at such time, on such basis and with such conditions as the Trustees
in their sole discretion may establish. Immediately upon the action of the
Trustees ordering redemption of the Rights (the "Redemption Date"), the Rights
will terminate and the only right of the holders of Rights will be to receive
the redemption price.
At any time after any person becomes an Acquiring Person and prior to
the acquisition by any person of 50% or more of the outstanding Class A Shares,
the Trustees may exchange the then outstanding and exercisable Rights (other
than Rights owned by an Acquiring Person, which will have become null and void),
in whole or in part, for Class A Shares, at an exchange ratio of one Class A
Share for each two Class A Shares for which each Right is then exercisable,
subject to adjustment.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends.
The terms of the Rights may be amended by the Trustees without the
consent of the holders of the Rights, including an amendment to extend the Final
Expiration Date and, provided a Distribution Date has not occurred, to extend
the period during which the Rights may be redeemed, except that after the
Distribution Date no such amendment may materially and adversely affect the
interests of the holders of the Rights.
As of November 12, 1996, there were 2,617,000 Class A Shares
outstanding. Each outstanding Class A Share on November 18, 1996 will receive
one Right. As long as the Rights are attached to the Class A Share, the Company
will issue one Right for each Class A Share issued between the Record Date and
the Distribution Date (or earlier redemption, expiration or
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termination of the Rights) so that all such shares will have attached Rights.
The Company has unlimited Class A Shares available for issuance upon exercise of
the Rights.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
without conditioning the offer on a substantial number of Rights being acquired.
Accordingly, the existence of the Rights may deter certain acquirors from making
takeover proposals or tender offers. However, the rights plan helps ensure that
the Company's shareholders receive fair and equal treatment in the event of any
proposed takeover of the Company. The adoption of the plan is not in response to
any specific takeover threat or proposal, but is a precaution taken to protect
the rights of the Company's shareholders.
The Rights Agreement between the Company and the Rights Agent
specifying the terms of the Rights, which includes as Exhibit A the form of
Right Certificate and as Exhibit B a Summary of Rights is attached hereto as
Exhibit 1 and is incorporated herein by reference. The foregoing description of
the Rights does not purport to be complete and is qualified in its entirety by
reference to such Exhibits.
ITEM 2. EXHIBITS
1. Rights Agreement, dated as of November 13, 1996, between Angeles
Mortgage Investment Trust and Chase Mellon Shareholder Services,
L.L.C., which includes as Exhibit A thereto the Form of Right
Certificate, and as Exhibit B thereto a Summary of Rights.
Pursuant to the Rights Agreement, Right Certificates will not be
mailed until after the earlier of (i) the tenth business day
after the Share Acquisition Date, or (ii) the tenth business day
(or such later date as may be determined by the Board of Trustees
prior to the time that any Person becomes an Acquiring Person)
after the date of the commencement of, or first public
announcement of the intent to commence, a tender offer by any
person or group of affiliated or associated persons, if upon
consummation thereof, such person or group would be the
beneficial owner of 20% or more of the outstanding Class A Shares
of Angeles Mortgage Investment Trust.
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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, thereto duly authorized.
ANGELES MORTGAGE INVESTMENT TRUST
DATE: December 3, 1996 By /s/ Ronald J. Consiglio
-----------------------------------------
Ronald J. Consiglio
President and Chief Executive Officer
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EXHIBIT INDEX
Exhibit No. Description Page
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1 Rights Agreement, dated as of November 13, 1996, 8
between Angeles Mortgage Investment Trust and Chase
Mellon Shareholder Services, L.L.C., which includes
as Exhibit A thereto the Form of Right Certificate,
and as Exhibit B thereto a Summary of Rights
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EXHIBIT 1
ANGELES MORTGAGE INVESTMENT TRUST,
a California business trust
and
CHASE MELLON SHAREHOLDER SERVICES, L.L.C.
Rights Agent
RIGHTS AGREEMENT
Dated as of November 13, 1996
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TABLE OF CONTENTS
<TABLE>
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Page(s)
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Section 1. Certain Definitions............................................................................. 1
Section 2. Appointment of Rights Agent..................................................................... 7
Section 3. Issue of Right Certificates..................................................................... 7
Section 4. Form of Right Certificates. ................................................................... 9
Section 5. Countersignature and Registration............................................................... 9
Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen Right Certificates..................................................... 10
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights................................... 11
Section 8. Cancellation of Right Certificates.............................................................. 13
Section 9. Authorization of Shares......................................................................... 14
Section 10. Record Date.................................................................................... 14
Section 11. Adjustment of Purchase Price; Number of Shares or Number of Rights............................. 15
Section 12. Certificate of Adjusted Purchase Price or Number of Shares..................................... 21
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power........................... 21
Section 14. Fractional Rights and Fractional Shares........................................................ 23
Section 15. Rights of Action............................................................................... 24
Section 16. Agreement of Right Holders..................................................................... 25
Section 17. Right Certificate Holder Not Deemed a Stockholder.............................................. 25
Section 18. Concerning the Rights Agent.................................................................... 26
Section 19. Duties of Rights Agent......................................................................... 27
</TABLE>
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TABLE OF CONTENTS
(continued)
<TABLE>
<CAPTION>
Page(s)
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<S> <C>
Section 20. Merger or Consolidation or Change of Name of Rights Agent...................................... 30
Section 21. Change of Rights Agent......................................................................... 31
Section 22. Issuance of New Right Certificates............................................................. 32
Section 23. Redemption..................................................................................... 32
Section 24. Mandatory Redemption and Exchange.............................................................. 33
Section 25. Notice of Certain Events....................................................................... 34
Section 26. Listing; Securities Laws Registrations......................................................... 35
Section 27. Notices........................................................................................ 36
Section 28. Supplements and Amendments..................................................................... 37
Section 29. Successors..................................................................................... 38
Section 30. Determinations and Actions by the Trustees..................................................... 38
Section 31. Effect on Class B Shares....................................................................... 39
Section 32. Benefits of this Agreement..................................................................... 39
Section 33. Severability................................................................................... 39
Section 34. Governing Law.................................................................................. 39
</TABLE>
Exhibits
--------
Exhibit A - Form of Right Certificate
Exhibit B - Angeles Mortgage Investment Trust Shareholder Plan; Summary of
Rights to Purchase Class A Shares
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RIGHTS AGREEMENT
This Rights Agreement, dated as of November 13, 1996, is between
Angeles Mortgage Investment Trust, a California business trust (the "Company"),
and Chase Mellon Shareholder Services, L.L.C. (the "Rights Agent").
The Trustees, having determined their actions to be in the interests of
the Company, have authorized the creation of Rights, have authorized the
issuance of one Right for each Class A Share of the Company outstanding on
November 18, 1996 (the "Record Date"), and have further authorized the issuance
of one Right with respect to each additional Class A Share that shall become
outstanding between the Record Date and the earliest of the Distribution Date,
the Redemption Date or the Final Expiration Date; and
The Trustees have authorized and directed that the terms and conditions
under which the Rights are to be distributed, including without limitation those
affecting the exercise thereof, the securities or other property to be acquired
thereby and the purchase price to be paid therefor, shall be set forth in a
written agreement between the Company and a rights agent made for the benefit of
the holders of the Rights to the extent so provided therein.
Accordingly, in consideration of the premises and the mutual agreements
herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement, the
following terms shall have the meanings indicated:
(a) "Acquiring Person" shall mean any Person who or which,
together with all Affiliates and Associates of such Person, shall be the
Beneficial Owner of 20% or more of the Class A Shares then outstanding, but
shall not include the Company, any Subsidiary of the Company, any employee
benefit plan of the Company or of any Subsidiary of the Company, or any trustee
of or fiduciary with respect to any such plan when acting in such capacity.
Notwithstanding the foregoing, no Person shall become an "Acquiring Person" as
the result of an acquisition of Class A Shares by the Company which, by reducing
the number of shares outstanding, increases the proportionate number of shares
beneficially owned by such Person to 20% or more of the Class A Shares then
outstanding; provided, however, that, if a Person shall
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become the Beneficial Owner of 20% or more of the Class A Shares then
outstanding by reason of share purchases by the Company and shall after such
share purchases by the Company and at a time when such Person is the Beneficial
Owner of 20% or more of the Class A Shares then outstanding, become the
Beneficial Owner of any additional Class A Shares, then such Person shall be
deemed to be an Acquiring Person. Notwithstanding the foregoing, if the Trustees
determine in good faith that a Person who would otherwise be an "Acquiring
Person," as defined pursuant to the prior sentence of this paragraph, has become
such inadvertently, and such Person divests as promptly as practicable a
sufficient number of Class A Shares so that such Person would no longer be an
"Acquiring Person," as defined pursuant to the prior sentence of this paragraph,
then such Person shall not be deemed to be an Acquiring Person for any purposes
of this Agreement.
(b) "Agreement" shall mean this Rights Agreement as hereafter
amended from time to time.
(c) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act as in effect on the date of this Agreement.
(d) A Person shall be deemed the "Beneficial Owner" of and shall
be deemed to "own beneficially" any securities that (without duplication):
(i) such Person or any of such Person's Affiliates or
Associates beneficially owns, directly or indirectly, within the meaning of
either Section 13 or 16 of the Exchange Act;
(ii) such Person or any of such Person's Affiliates or
Associates has (A) the right to acquire (whether such right is exercisable
immediately or only after the passage of time) pursuant to any formal or
informal agreement, arrangement or understanding (other than customary
agreements with and between underwriters and selling group members with respect
to a bona fide public offering of securities), or upon the exercise of
conversion rights, exchange rights, rights (other than these Rights), warrants
or options, or otherwise; or (B) the right to vote pursuant to any agreement,
arrangement or understanding; or
(iii) are beneficially owned, directly or indirectly, by any
other Person with which such Person or any of such Person's Affiliates or
Associates has any formal or informal
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agreement, arrangement or understanding (other than customary agreements with
and between underwriters and selling group members with respect to a bona fide
public offering of securities) for the purpose of acquiring, holding voting or
disposing of any securities of the Company; provided, however, that, for
purposes of each clause of this definition, a Person shall not be deemed the
Beneficial Owner of, or to own beneficially, securities tendered pursuant to a
tender or exchange offer made by or on behalf of such Person or any of such
Person's Affiliates or Associates until such tendered securities are accepted
for purchase or exchange; and provided, further, that, for purposes of each
clause of this definition, a Person shall not be deemed the Beneficial Owner of,
or to own beneficially, any security as a result of any agreement, arrangement
or understanding to vote such security if such agreement, arrangement or
understanding (l) arises solely from a revocable proxy or consent given to such
Person in response to a public proxy or consent solicitation made pursuant to,
and in accordance with, the applicable rules and regulations promulgated under
the Exchange Act and (2) is not also then reportable on Schedule 13D under the
Exchange Act (or any comparable or successor report).
Notwithstanding anything in this definition to the contrary, the
phrase "then outstanding," when used with reference to a Person's Beneficial
Ownership of securities of the Company (or to the number of such securities
"beneficially owned"), shall mean the number of such securities then issued and
outstanding together with the number of such securities not then actually issued
and outstanding which such Person would be deemed to own beneficially hereunder.
(e) "Business Day" shall mean any day other than a Saturday,
Sunday or a day on which banking institutions in the State of California are
authorized or obligated by law or executive order to close.
(f) "Class A Shares" shall mean the $1.00 par value investment
trust units of the Company which are denominated Class A Shares by the
Declaration of Trust of the Company, or any substitute for such units.
(g) "Close of Business" on any given date shall mean 5:00 P.M.,
Los Angeles time, on such date; provided, however, that if such date is not a
Business Day it shall mean 5:00 P.M., Los Angeles time, on the next succeeding
Business Day.
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(h) "Closing Price," with respect to any security, shall mean
the last sale price, regular way, on a specific Trading Day or, in case no such
sale takes place on such Trading Day, the average of the closing bid and asked
prices, regular way, in either case, as reported in the principal consolidated
transaction reporting system with respect to securities listed on the principal
national securities exchange on which such security is listed or admitted to
trading or, if such security is not then listed or admitted to trading on any
national securities exchange, the last quoted price or, if not so quoted, the
average of the high bid and low asked prices in the over-the-counter market, as
reported by the National Association of Securities Dealers, Inc. Automated
Quotations System or such other system then in use, or, if on any such Trading
Day such security is not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market maker making
a market in such security selected by the Trustees. If such security is not
publicly held or so listed or traded, "Closing Price" shall mean the fair value
per unit of such security as determined in good faith by the Trustees, whose
determination shall be described and the Closing Price set forth in a statement
filed with the Rights Agent.
(i) "Common Shares" when used with reference to the Company
shall mean shares of capital stock of the Company which have no preference over
any other class of stock with respect to dividends or assets, which are not
redeemable at the option of the Company and with respect to which no sinking,
purchase or similar fund is provided. "Common Shares" when used with reference
to any Person other than the Company shall, if used with reference to a
corporation, mean the capital stock (or equity interest) with the greatest
voting power of such other Person or, if such other Person is a Subsidiary of
another Person, the Person or Persons which ultimately control such
first-mentioned Person and, if used with reference to any other Person, mean the
equity interest in such Person (or, if the net worth determined in accordance
with generally accepted accounting principles of another Person (other than an
individual) which controls such first-mentioned Person is greater than such
first-mentioned Person, then such other Person) with the greatest voting power
or managerial power with respect to the business and affairs of such Person.
(j) "Corporate Trust Office" means the principal office of the
Rights Agent at which it administers its corporate trust business, which, in the
case of Chase Mellon
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Shareholder Services, L.L.C., shall, until hereafter changed, be its office at
450 West 33rd Street, 15th Floor, New York, New York 10001.
(k) "Distribution Date" shall mean the earlier of (i) the Close
of Business on the tenth Business Day after the Share Acquisition Date or (ii)
the tenth Business Day (or such later date as may be determined by action of the
Trustees prior to such time as any Person becomes an Acquiring Person) after the
date of commencement by any Person (other than the Company, any Subsidiary of
the Company, any employee benefit plan of the Company or of any Subsidiary of
the Company, or any trustee of or fiduciary with respect to any such plan when
acting in such capacity) of, or after the date of the first public announcement
of the intent of any Person (other than the Company, any Subsidiary of the
Company, any employee benefit plan of the Company or of any Subsidiary of the
Company, or any trustee of or fiduciary with respect to any such plan when
acting in such capacity) to commence, a tender or exchange offer the
consummation of which would result in any Person becoming the Beneficial Owner
of 20% or more of the then outstanding Class A Shares; provided, however, that
an occurrence described in clause (ii) of this definition above shall not cause
the occurrence of the Distribution Date if the Trustees shall, prior to such
tenth Business Day (or such later date as described in clause (ii) above),
determine that such tender or exchange offer is spurious, unless, thereafter,
the Trustees shall make a contrary determination, in which event the
Distribution Date shall occur on the later to occur of such tenth Business Day
(or such later date as described in clause (ii) above) and the date of such
latter determination.
(l) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended, and any successor statute thereto.
(m) "Final Expiration Date" shall mean the Close of Business on
December 31, 2003, or if the Company's termination date under its Declaration of
Trust is extended beyond December 31, 2003, the earlier of the Company's
termination date or November 12, 2006.
(n) "Person" shall mean any individual, firm, corporation,
partnership, limited partnership, limited liability company, trust or other
entity, and shall include any successor (by merger or otherwise) of such entity.
(o) "Purchase Price" shall mean the initial price at which the
holder of a Right may, subject to the terms and conditions of this Agreement,
purchase one Class A Share (which
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initial price is set forth in Section 7(b) hereof), as such price shall be
adjusted pursuant to the terms of this Agreement.
(p) "Redemption Date" shall mean the time at which the Trustees
adopt a resolution pursuant to which the Rights are to be redeemed pursuant to
Section 23 hereof or pursuant to which all of the Rights are to be mandatorily
redeemed and exchanged pursuant to Section 24 hereof.
(q) "Redemption Price" shall have the meaning specified in
Section 23(b) hereof.
(r) "Right" shall mean one Class A Share purchase right which
initially represents the right of the registered holder thereof to purchase one
Class A Share upon the terms and subject to the conditions herein set forth.
(s) "Right Certificate" shall mean a certificate, in
substantially the form of Exhibit A attached to this Rights Agreement,
evidencing the Rights registered in the name of the holder thereof.
(t) "Rights Register" and "Rights Registrar" shall have the
meanings specified in Section 6.
(u) "Share Acquisition Date" shall mean the first date of public
announcement (which for purposes of this definition shall include without
limitation a report filed pursuant to Section 13(d) or Section 16(a) of the
Exchange Act) by the Company or an Acquiring Person that an Acquiring Person has
become such.
(v) "Subsidiary" of any Person shall mean any corporation or
other entity of which a majority of the outstanding capital stock or other
equity interests having ordinary voting power in the election of directors or
similar officials is owned, directly or indirectly, by such Person.
(w) "Summary of Rights" shall mean a Summary of Rights to
Purchase Class A Shares in substantially the form attached as Exhibit B to this
Agreement.
(x) "Trading Day" shall mean a day on which the principal
national securities exchange on which any of the Class A Shares are listed or
admitted to trading is open for the transaction of business or, if none of the
Class A Shares is listed or admitted to trading on any national stock exchange,
a Business Day.
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(y) "Wholly-Owned Subsidiary" of a Person shall mean any
corporation or other entity all the outstanding capital stock or other equity
interests of which having ordinary voting power in the election of directors or
similar officials (other than directors' qualifying shares or similar interests)
are owned, directly or indirectly, by such Person.
Section 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such co-Rights Agents as it may deem
necessary or desirable upon prior written notice to the Rights Agent. The Rights
Agent shall have no duty to supervise, and shall in no event be liable for, the
acts or omissions of any such co-Rights Agent.
Section 3. Issue of Right Certificates.
(a) From and after the Record Date until the Distribution Date,
(i) outstanding Rights will be evidenced (subject to the provisions of paragraph
(b) of this Section 3) by the certificates for outstanding Class A Shares and
not by separate Right Certificates, and (ii) the right to receive Right
Certificates will be transferable only in connection with the transfer of Class
A Shares. As soon as practicable after the Distribution Date, the Rights Agent
will send, by first-class, insured, postage-prepaid mail, to each record holder
of Class A Shares as of the Close of Business on the Distribution Date, at the
address of such holder shown on the records of the Company, a Right Certificate
evidencing one Right for each Class A Share so held. From and after the
Distribution Date, the Rights will be evidenced solely by such Right
Certificates.
(b) As soon as practicable after the Record Date, the Company
will send a copy of a Summary of Rights, by first-class, postage-prepaid mail,
to each record holder of Class A Shares as of the Close of Business on the
Record Date, at the address of such holder shown on the records of the Company.
With respect to Class A Shares outstanding on the Record Date, the certificates
evidencing such Class A Shares shall, together with copies of such Summary of
Rights, thereafter also evidence the outstanding Rights (as such Rights may be
amended or supplemented) distributed with respect thereto until the earlier of
the Distribution Date or the date of surrender thereof to the Company's transfer
agent for registration of transfer
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or exchange of Class A Shares. Until the Distribution Date (or, if earlier, the
Redemption Date or Final Expiration Date), the surrender for registration of
transfer or exchange of any certificate for Class A Shares outstanding as of the
Close of Business on the Record Date, with or without a copy of the Summary of
Rights attached thereto, shall also constitute the surrender for registration of
transfer or exchange of the outstanding Rights associated with the Class A
Shares represented thereby.
(c) Rights shall be issued in respect of all Class A Shares
which are issued after the Record Date but prior to the earliest of the
Redemption Date or Final Expiration Date.
(d) Certificates for Class A Shares issued after the Record Date
but prior to the earliest of the Distribution Date, the Redemption Date and the
Final Expiration Date, whether upon registration of transfer or exchange of
Class A Shares outstanding on the Record Date or upon original issue thereafter,
shall have impressed on, printed on, written on or otherwise affixed to them the
following legend:
This certificate also evidences and entitles the holder hereof
to certain Rights as set forth in a Rights Agreement between Angeles
Mortgage Investment Trust (the "Company") and Chase Mellon Shareholder
Services, L.L.C., dated as of November 13, 1996 (the "Rights
Agreement"), the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal executive
offices of the Company. Under certain circumstances, as set forth in
the Rights Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this certificate. The
Company will mail to the holder of this certificate a copy of the
Rights Agreement without charge after receipt of a written request
therefor. As described in the Rights Agreement, Rights issued to or
acquired by any Acquiring Person or any Affiliate or Associate thereof
(each as defined in the Rights Agreement) shall become null and void.
With respect to certificates containing the foregoing legend, until the
Distribution Date, outstanding Rights associated with the Class A Shares
represented by such certificates shall be evidenced by such certificates alone,
and the surrender of any such certificate for registration of transfer or
exchange of the Class A Shares evidenced thereby shall also constitute surrender
for registration of transfer or exchange of outstanding Rights (as such Rights
may be amended or supplemented) associated with the Class A Shares represented
thereby.
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(e) If the Company purchases or acquires any of its Class A
Shares after the Record Date, but prior to the Distribution Date, the Company
shall not be entitled to exercise any Rights associated with such Class A
Shares.
Section 4. Form of Right Certificates.
(a) The Right Certificates (and the forms of election to
purchase Class A Shares and of assignment to be printed on the reverse thereof)
shall in form and substance be substantially the same as Exhibit A and may have
such marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which the Rights
may from time to time be listed or any securities association on whose
interdealer quotation system the Rights may from time to time by authorized for
quotation, or as may be necessary to conform to usage. Subject to the provisions
of Section 22 hereof, the Right Certificates that are issued in respect of Class
A Shares that were issued and outstanding as of the Record Date, shall be dated
as of the Record Date, and all Right Certificates that are issued in respect of
other Class A Shares shall be dated as of the respective dates of issuance of
such Class A Shares, and in either case on their face shall entitle the holders
thereof to purchase number of Class A Shares as shall be set forth therein at
the price per Class A Share set forth therein (the "Purchase Price"), but the
number of such Class A Shares and the Purchase Price shall be subject to
adjustment as provided herein.
(b) No Right Certificate shall be issued pursuant to this
Agreement that represents Rights which have become or would become null and void
pursuant to Section 7(e) hereof and any Right Certificate delivered to the
Rights Agent for transfer to a Person whose Rights would be null and void
pursuant to Section 7(e) or to any nominee (acting in its capacity as such) of
such Person shall be cancelled.
Section 5. Countersignature and Registration.
(a) The Right Certificates shall be executed on behalf of the
Company by its chairman, its president or a vice president, either manually or
by facsimile signature, and have
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affixed thereto the Company's seal or a facsimile thereof that shall be attested
by the secretary, or an assistant secretary or treasurer, of the Company, either
manually or by facsimile signature. The Right Certificates shall be manually
countersigned by the Rights Agent and shall not be valid for any purpose unless
so countersigned. In case any officer of the Company who shall have signed any
of the Right Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Right Certificates, nevertheless, may be countersigned by the Rights Agent,
and issued and delivered by the Company with the same force and effect as though
the person who signed such Right Certificates had not ceased to be such officer
of the Company; and any Right Certificate may be signed on behalf of the Company
by any person who, at the actual date of the execution of such Right
Certificate, shall be a proper officer of the Company to sign such Right
Certificate, although at the date of the execution of this Rights Agreement any
such person was not such an officer.
(b) From and after the Distribution Date and prior to the
earlier of the Redemption Date and the Final Expiration Date, the Company shall
cause to be kept at the Corporate Trust Office of the Rights Agent a Rights
Register in which, subject to such reasonable regulations as it may prescribe,
the Company shall provide for the registration of Right Certificates and of
transfers of Rights. The Rights Agent is hereby appointed the registrar and
transfer agent for the purpose of registering Right Certificates and transfers
of Rights as herein provided and the Rights Agent agrees to maintain such Rights
Register in accordance with such regulations so long as it continues to be
designated as Rights Registrar hereunder.
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
(a) Subject to the provisions of Section 4(b), Section 7(e),
Section 11 and Section 14, at any time after the Close of Business on the
Distribution Date, and at or prior to the Close of Business on the earlier of
the Redemption Date or the Final Expiration Date, any Right Certificate or Right
Certificates may be transferred, split up, combined or exchanged for another
Right Certificate or Right Certificates, entitling the registered holder to
purchase a like number of Class A Shares (or other securities or other assets,
as the case may be) as the Right
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<PAGE> 14
Certificate or Right Certificates surrendered then entitled such holder to
purchase. Any registered holder desiring to transfer, split up, combine or
exchange any Right Certificate shall make such request in writing delivered to
the Rights Agent, and shall surrender the Right Certificate or Right
Certificates to be transferred, split up, combined or exchanged, with the form
of assignment and certificate appropriately executed, at the office of the
Rights Agent designated for such purpose. Neither the Rights Agent nor the
Company shall be obligated to take any action whatsoever with respect to the
transfer of any such surrendered Right Certificate until the registered holder
shall have completed and signed the certificate contained in the form of
assignment on the reverse side of such Right Certificate and shall have provided
such additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company shall
reasonably request. Thereupon, the Rights Agent shall, subject to Section 4(b),
Section 7(e), Section 11 and Section 14, countersign and deliver to the person
entitled thereto a Right Certificate or Right Certificates, as the case may be,
as so requested. The Company may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation of
a Right Certificate, and, in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to them, and, at the Company's request,
reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender to the Rights Agent and cancellation of
the Right Certificate if mutilated, the Company will make and deliver a new
Right Certificate of like tenor to the Rights Agent for countersignature and
delivery to the registered owner in lieu of the Right Certificate so lost,
stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights.
(a) The registered holder of any Right Certificate may exercise
the Rights evidenced thereby (except as otherwise provided herein) in whole or
in part at any time after the Distribution Date upon surrender of the Right
Certificate, with the form of election to purchase on the reverse side thereof
duly executed, to the Rights Agent at its Corporate Trust Office,
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<PAGE> 15
together with payment of the Purchase Price for each Class A Share (or other
securities) as to which the Rights are exercised, at or prior to the earliest of
(i) the Close of Business on the Final Expiration Date, (ii) the time of
redemption on the Redemption Date, or (iii) the time at which such Rights are
mandatorily redeemed and exchanged as provided in Section 24 hereof.
(b) The Purchase Price for each Class A Share pursuant to the
exercise of a Right shall initially be Sixty Dollars ($60.00), shall be subject
to adjustment from time to time as provided in Sections 11 and 13 hereof and
shall be payable in lawful money of the United States of America in accordance
with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing exercisable
Rights, with the form of election to purchase duly executed, accompanied by
payment of the Purchase Price for the securities to be purchased and an amount
equal to any applicable transfer tax required to be paid by the holder of such
Right Certificate in accordance with Section 9 in cash, or by certified check or
cashier's check payable to the order of the Company, the Rights Agent shall
thereupon promptly (i) requisition from any transfer agent of the Class A Shares
(or other securities) certificates for such number of Class A Shares (or other
securities) as are to be purchased and registered in such name or names as may
be designated by the registered holder of such Right Certificate or, if
appropriate, in the name of a depositary agent or its nominee, and the Company
hereby irrevocably authorizes its transfer agent to comply with all such
requests, (ii) when appropriate, requisition from the Company the amount of cash
to be paid in lieu of issuance of fractional shares in accordance with Section
14, (iii) promptly after receipt of such certificates registered in such name or
names as may be designated by such holder, cause the same to be delivered to or
upon the order of the registered holder of such Right Certificate and (iv) when
appropriate, after receipt, promptly deliver such cash to or upon the order of
such holder.
(d) If the registered holder of the Right Certificate shall
exercise less than all the Rights evidenced thereby, a new Right Certificate
evidencing Rights equal to the Rights remaining unexercised shall be issued by
the Rights Agent to the registered holder of such Right Certificate or to his
duly authorized assigns, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything to the contrary in this Agreement,
from and after the first date that a Person becomes an Acquiring Person, any
Rights beneficially owned by
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<PAGE> 16
(i) any Acquiring Person (or any Associate or Affiliate of an Acquiring Person),
(ii) a transferee of an Acquiring Person (or any Associate or Affiliate of an
Acquiring Person) which becomes a transferee after the Acquiring Person becomes
such, or (iii) a transferee of an Acquiring Person (or any Associate or
Affiliate of an Acquiring Person) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for consideration) from the
Acquiring Person (or any Associate or Affiliate of such Acquiring Person) to
holders of equity interests in such Acquiring Person (or of such Associate or
Affiliate) or to any Person with whom the Acquiring Person has any agreement,
arrangement or understanding regarding the transferred Rights, or (B) a transfer
that the Trustees have determined is part of a plan, arrangement or
understanding which has as a primary purpose or effect the avoidance of this
Section 7(e), shall be null and void without any further action and no holder of
such Rights shall have any rights whatsoever with respect to such Rights,
whether under any provision of this Agreement or otherwise. The Company shall
use all reasonable efforts to ensure that the provisions of this Section 7(e)
and Section 4(b) are complied with, but shall have not liability to any holder
of Rights or any other Person as a result of its failure to make any
determination under this Section 7(e) or such Section 4(b) with respect to any
Acquiring Person or an Associate or Affiliate of an Acquiring Person or their
transferees.
(f) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder upon the occurrence of any purported
transfer or exercise unless such registered holder shall have (i) completed and
signed the certificate following the form of assignment or election to purchase
set forth on the reverse side of the Right Certificate surrendered for such
assignment or exercise and (ii) provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates or
Associates thereof as the Company shall reasonably request.
Section 8. Cancellation of Right Certificates. All Right Certificates
surrendered for the purpose of exercise, transfer or exchange shall, if
surrendered to the Company or to any of its other agents, be delivered to the
Rights Agent for such purpose and for cancellation or, if surrendered to the
Rights Agent for such purpose, shall be cancelled by it. No Right Certificates
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shall be authenticated in lieu of or in exchange for any Right Certificates
cancelled as provided in this Section 8 except as expressly permitted by any of
the provisions of this Agreement The Company shall deliver to the Rights Agent
for cancellation, and the Rights Agent shall so cancel, any other Right
Certificate purchased or acquired by the Company. The Rights Agent shall deliver
all canceled Right Certificates to the Company.
Section 9. Authorization of Shares.
(a) The Company shall has available an unlimited number of its
authorized and unissued Class A Shares. The Company will not take any action to
limit the number of Class A Shares below a number that will be sufficient to
permit the exercise of outstanding Rights pursuant to the adjustments set forth
in Section 11(a)(ii) or Section 13.
(b) The Company covenants and agrees that it will take all such
action as may be necessary to ensure that all Class A Shares issued upon
exercise of Rights shall (subject to payment of the Purchase Price) be duly
authorized, validly issued, fully paid and nonassessable. The Company further
covenants and agrees that it will pay when due and payable any and all federal
and state transfer taxes and charges which may be payable in respect of the
issuance or delivery of the Right Certificates or of any Class A Shares upon the
exercise of Rights. The Company shall not, however, be required to pay any
transfer tax which may be payable in respect of any transfer or delivery of
Right Certificates to a Person other than, or in respect of the issuance or
delivery of certificates for Class A Shares upon exercise of Rights evidenced by
Right Certificates in a name other than that of, the registered holder of the
Right Certificate evidencing Rights surrendered for transfer or exercise or to
issue or deliver any certificates for Class A Shares upon the exercise of any
Rights until any such tax shall have been paid (any such tax being payable by
the holder of such Right Certificate at the time of surrender thereof) or until
it has been established to the Company's satisfaction that no such tax is due.
Section 10. Record Date. Each Person in whose name any certificate for
Class A Shares is issued upon the exercise of, or upon mandatory redemption and
exchange of, Rights shall for all purposes be deemed to have become the holder
of record of the Class A Shares represented thereby on, and such certificate
shall be dated, (i) in the case of an exercise of Rights, the date
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<PAGE> 18
upon which the Right Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and any applicable transfer taxes) was made, or
(ii) in the case of the mandatory redemption and exchange of Rights, the date of
such mandatory redemption and exchange; provided, however, that if the date of
such surrender and payment or mandatory redemption and exchange is a date upon
which the transfer books of the Company for its Class A Shares 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 such
transfer books of the Company are open. Prior to the exercise of (or the
mandatory redemption and exchange of) the Rights evidenced thereby, the holder
of a Right Certificate shall not be entitled to any rights of a holder of Class
A Shares for which the Rights shall be exercisable, including without limitation
the rights to vote, to receive dividends or other distributions or to exercise
any preemptive rights, and shall not be entitled to receive my notice of any
proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price; Number of Shares or Number of
Rights. The Purchase Price, the number and kind of shares of capital stock of
the Company covered by each Right and the number of Rights outstanding are
subject to adjustment from time to time as provided in this Section 11.
(a) (i) If the Company shall at any time (A) declare a
dividend on the Class A Shares payable in Class A Shares, (B) subdivide the
outstanding Class A Shares, (C) combine the outstanding Class A Shares into a
smaller number of Class A Shares or (D) issue any shares of its capital stock in
a reclassification of the Class A Shares (including any such reclassification in
connection with a consolidation or merger in which the Company is the continuing
or surviving corporation), except as otherwise provided in this Section 11(a),
the Purchase Price in effect at the time of the record date for such dividend or
of the effective date of such subdivision, combination or reclassification, and
the number and kind of shares of capital stock issuable on such date, shall be
proportionately adjusted so that the holder of any Right exercised thereafter
shall be entitled to receive the aggregate number and kind of shares of capital
stock which, if such Right had been duly exercised immediately prior to such
date (at a time when the Class A Shares transfer books of the Company were
open), such holder would have acquired
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upon such exercise and been entitled to receive by virtue of such dividend,
subdivision, combination or reclassification. If an event occurs which would
require an adjustment under both Section 11(a)(i) and Section 11(a)(ii), the
adjustment provided for in this Section 11(a)(i) shall be in addition to, and
shall be made prior to, any adjustment required pursuant to Section 11(a)(ii).
(ii) Subject to action of the Trustees pursuant to Section
23 or Section 24 of this Agreement, if any Person shall become an Acquiring
Person, each holder of a Right, except as provided in Section 7(e), shall
thereafter have a right to receive, upon exercise thereof at the then current
Purchase Price in accordance with the terms of this Agreement, such number of
Class A Shares as shall equal the result obtained by (x) multiplying the then
current Purchase Price by the number of Class A Shares for which a Right was
then exercisable and by dividing that product by 50% of the then current per
share market price of the Company's Class A Shares (determined pursuant to
Section 11(d)) on the date such Person became an Acquiring Person.
(b) If the Company shall fix a record date for the issuance of
rights, options or warrants to all holders of Class A Shares entitling them (for
a period expiring within 45 calendar days after such record date) to subscribe
for or purchase Class A Shares (or shares having the same rights privileges and
preferences as the Class A Shares ("Equivalent Common Shares")) or securities
convertible into or exchangeable for Class A Shares or Equivalent Common Shares
at a price per Class A Share or Equivalent Common Share (together with any
additional consideration required upon conversion or exchange in the case of a
security convertible into or exchangeable for Class A Shares or Equivalent
Common Shares), less than the current per share market price of the Class A
Shares (determined pursuant to Section 12(d) on such record date), the Purchase
Price to be in effect after such record date shall be determined by multiplying
the Purchase Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the number of Class A Shares
outstanding
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on such record date plus the number of Class A Shares which the aggregate
offering price of the total number of Class A Shares and/or Equivalent Common
Shares so to be offered (together with the aggregate of any additional
consideration required upon conversion or exchange in the case of any
convertible or exchangeable securities so to be offered) would purchase at such
current market price and the denominator of which shall be the number of Class A
Shares outstanding on such record date plus the number of additional Class A
Shares and/or Equivalent Common Shares to be offered for subscription or
purchase (or into or for which the convertible or exchangeable securities so to
be offered are initially convertible or exchangeable). In case all or part of
such subscription or purchase price may be paid in a form other than cash, the
value of such consideration shall be as determined in good faith by the
Trustees, whose determination shall be described in a statement filed with the
Rights Agent. Class A Shares owned by or held for the account of the Company or
any of its Subsidiaries shall not be deemed outstanding for the purpose of any
computation described in this Section 11(b). The adjustment described in this
Section 11(b) shall be made successively whenever such a record date is fixed;
and, if none of such rights, options or warrants is so issued, the Purchase
Price shall be adjusted to be the Purchase Price which would then be in effect
if such record date had not been fixed.
(c) If the Company shall fix a record date for the making of a
distribution to all holders of the Class A Shares (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation) of evidences of indebtedness
or assets (other than a regular quarterly cash dividend or a dividend payable in
Class A Shares) or subscription rights or warrants (excluding those referred to
in Section 11(b)), the Purchase Price to be in effect after such record date
shall be determined by multiplying the Purchase Price in effect immediately
prior to such record date by a fraction, the numerator of which shall be the
then current per share market price of the Class A Shares (determined pursuant
to Section 11(d)) on such record date, less the fair market value (as determined
in good faith by the Trustees, whose determination shall be described in a
statement filed with the Rights Agent) of the portion of the assets or evidences
of indebtedness so to be distributed or of such subscription rights or warrants
applicable to one Class A Share and the denominator of which shall be such
current per share market price of the Class A Shares. Such adjustments shall be
made successively whenever such a record date is fixed; and, if such
distribution is not so made, the Purchase Price shall again be adjusted to be
the Purchase Price which would then be in effect if such record date had not
been fixed.
(d) For the purpose of any computation hereunder, the "current
per share market price" of the Class A Shares on any date shall be deemed to be
the average of the daily Closing Prices per share of such Class A Shares for the
30 consecutive Trading Days
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immediately prior to such date; provided, however, that, if the Company shall
announce (A) a dividend or distribution on such Class A Shares payable in such
Class A Shares or securities convertible into such Class A Shares or (B) any
subdivision, combination or reclassification of such Class A Shares, and the
ex-dividend date for such dividend or distribution, or the record date for such
subdivision, combination or reclassification, shall occur during such period of
30 Trading Days, then, and in each such case, the current per share market price
of the Class A Shares shall be appropriately adjusted to reflect the current
market price per Class A Share equivalent.
(e) No adjustment in the Purchase Price shall be required unless
such adjustment would require an increase or decrease of at least 1% in the
Purchase Price; provided, however, that any adjustments which by reason of this
Section 11(e) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Section
11 shall be made to the nearest cent or to the nearest ten-thousandth of a Class
A Share or other share, as the case may be, and references herein to the "number
of Class A Shares" (or similar phrases) shall be construed to include fractions
of a Class A Share. Notwithstanding the first sentence of this Section 11(e),
any adjustment required by this Section 11 shall be made no later than the
earlier of (i) three years from the date of the transaction which requires such
adjustment or (ii) the thirtieth day preceding the Final Expiration Date.
(f) If as a result of an adjustment made pursuant to Section
11(a), the holder of any Right thereafter exercised shall become entitled to
receive any shares of capital stock of the Company other than Class A Shares,
thereafter the number of such other shares so receivable upon exercise of any
Right shall be subject to adjustment from time to time in a manner and on terms
as nearly equivalent as practicable to the provisions with respect to the shares
contained in this Section 11, and the provisions of this Agreement, including
without limitation Sections 7, 9, 10 and 13, with respect to the Class A Shares
shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to
any adjustment made to the Purchase Price hereunder shall, whether or not the
Right Certificate evidencing such Rights reflects such adjusted Purchase Price,
evidence the right to purchase, at the adjusted
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Purchase Price, the number of Class A Shares purchasable from time to time
hereunder upon exercise of the Rights, all subject to further adjustment as
provided herein.
(h) Unless the Company shall have exercised its election as
provided in Section 11(i), upon each adjustment of the Purchase Price pursuant
to Section 11(b) or 11(c), each Right outstanding immediately prior to the
making of such adjustment shall thereafter evidence the right to purchase, at
the adjusted Purchase Price, that number of Class A Shares obtained by (i)
multiplying (x) the number of Class A Shares covered by a Right immediately
prior to this adjustment by (y) the Purchase Price in effect immediately prior
to such adjustment of the Purchase Price and (ii) dividing the product so
obtained by the Purchase Price in effect immediately after such adjustment of
the Purchase Price.
(i) The Company may elect on or after the date of any adjustment
of the Purchase Price to adjust the number of Rights outstanding in lieu of any
adjustment in the number of Class A Shares purchasable upon the exercise of a
Right. Each Right outstanding after such adjustment of the number of Rights
shall be exercisable for the number of Class A Shares for which a Right was
exercisable immediately prior to such adjustment of the Purchase Price. Each
Right held of record prior to such adjustment of the number of Rights shall
become that number of Rights (calculated to the nearest one ten-thousandth)
obtained by dividing the Purchase Price in effect immediately prior to
adjustment of the Purchase Price by the Purchase Price in effect immediately
after adjustment of the Purchase Price. The Company shall make a public
announcement, along with simultaneous written notice to the Rights Agent, of its
election to adjust the number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the adjustment to be made.
This record date may be the date on which the Purchase Price is adjusted or any
day thereafter, but, if the Right Certificates have been issued, shall be at
least 10 days later than the date of the public announcement. Until such record
date, however, any adjustment in the number of Class A Shares for which a Right
shall be exercisable made as required by this Agreement shall remain in effect.
If Right Certificates have been issued, upon each adjustment of the number of
Rights pursuant to this Section 11(i), the Company shall, as promptly as
practicable, cause to be distributed to holders of record of Right Certificates
on such record date Right Certificates evidencing, subject to Section 14 hereof,
the additional Rights to which such holders shall be entitled as a result of
such
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<PAGE> 23
adjustment, or, at the option of the Company, shall cause to be distributed to
such holders of record in substitution and replacement for the Right
Certificates held by such holders prior to the date of adjustment, and upon
surrender thereof, if required by the Company, new Right Certificates evidencing
all the Rights to which such holders shall be entitled after such adjustment.
Right Certificates so to be distributed shall be issued, executed and
authenticated in the manner provided for herein and shall be registered in the
names of the holders of record of Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase
Price or the number of Class A Shares issuable upon the exercise of the Rights,
the Right Certificates theretofore and thereafter issued may continue to express
the Purchase Price and the number of Class A Shares which were expressed in the
initial Right Certificates issued hereunder.
(k) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuance to the holder of any Right exercised after such record date
of the Class A Shares or other capital stock or securities of the Company, if
any, issuable upon such exercise over and above the Class A Shares or other
capital stock or securities of the Company, if any, issuable upon such exercise
on the basis of the Purchase Price in effect prior to such adjustment; provided,
however, that the Company shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder's right to receive such additional
securities upon the occurrence of the event requiring such adjustment.
(l) Anything in this Section 11 to the contrary notwithstanding,
the Company shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that it in its sole discretion shall determine to be advisable in
order that any combination or subdivision of the Class A Shares, issuance wholly
for cash of any of the Class A Shares at less than the current market price,
issuance wholly for cash of Class A Shares or securities which by their terms
are convertible into or exchangeable for Class A Shares, dividends on Class A
Shares payable in Class A Shares or issuance of rights, options or warrants
referred to in subsection (b) of this Section 11, hereafter effected by the
Company to holders of its Class A Shares shall not be taxable to such
shareholders.
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Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Section 11 or 13 hereof, the
Company shall (a) promptly prepare a certificate setting forth such adjustment,
and a brief statement of the facts accounting for such adjustment, (b) promptly
file with the Rights Agent and with each transfer agent for the Class A Shares a
copy of such certificate and (c) mail a brief summary thereof to each holder of
record of a Right Certificate in accordance with Section 27 hereof.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power. If, after the Share Acquisition Date, directly or indirectly, (a)
the Company shall consolidate with, or merge with and into, any other Person,
(b) any Person shall merge with and into the Company and the Company shall be
the continuing or surviving corporation of such merger and, in connection with
any such merger, all or part of the Class A Shares shall be changed into or
exchanged for stock or other securities of any other Person (or the Company) or
cash or any other property, or (c) the Company shall sell or otherwise transfer
(or one or more of its Subsidiaries shall sell or otherwise transfer), in one or
a series of two or more transactions, assets of the Company or its Subsidiaries
which constitute more than 50% of the assets or which produce more than 50% of
the earning power of the Company and its Subsidiaries (taken as a whole) to any
Person or any Affiliate or Associate of such Person other than the Company or
one or more of its Wholly-Owned Subsidiaries, then, and in each such case, the
Company agrees that, as a condition to engaging in any such transaction, it will
make or cause to be made proper provision so that (i) each holder of a Right
(except as provided in Section 7(e) hereof) shall thereafter have the right to
receive, upon the exercise thereof in accordance with the terms of this
Agreement, such number of Common Shares of such other Person (including the
Company as successor thereto or as the surviving corporation) or, if such other
Person is a Subsidiary of another Person, of the Person or Persons (other than
individuals) which ultimately control such first-mentioned Person, as shall be
equal to the result obtained by (X) multiplying the then current Purchase Price
by the number of Class A Shares for which a Right is then exercisable (without
taking into account any adjustment previously made pursuant to Section
11(a)(ii)) and (Y) dividing that product by 50% of the current per share market
price of the Common Shares of such other Person (determined pursuant to Section
11(d)) on the date of consummation of such
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<PAGE> 25
consolidation, merger, sale or transfer; (ii) the issuer of such Common Shares
shall thereafter be liable for, and shall assume, by virtue of such
consolidation, merger, sale or transfer, all the obligations and duties of the
Company pursuant to this Agreement; (iii) the term "Company" as used herein
shall thereafter be deemed to refer to such issuer; and (iv) such issuer shall
take such steps (including without limitation the reservation of a sufficient
number of shares of its Common Shares) in connection with such consummation as
may be necessary to assure that the provisions hereof shall thereafter be
applicable, as nearly as reasonably may be, in relation to the Class A Shares
thereafter deliverable upon the exercise of the Rights. The Company shall not
enter into any transaction of the kind referred to in this Section 13 if at the
time of such transaction there are outstanding any rights, warrants, instruments
or securities or any agreement or arrangements which, as a result of the
consummation of such transaction, would substantially diminish or otherwise
eliminate the benefits intended to be afforded by the Rights. The Company shall
not consummate any such consolidation, merger, sale or transfer unless prior
thereto the Company and such issuer shall have excused and delivered to the
Rights Agent an agreement supplemental to this Agreement complying with the
provisions of this Section 13. The provisions of this Section 13 shall similarly
apply to successive mergers or consolidations or sales or other transfers. For
the purposes of this Section 13, 50% of the assets of the Company and its
Subsidiaries shall be determined by reference to the book value of such assets
as set forth in the most recent consolidated balance sheet of the Company and
its Subsidiaries (which need not be audited) and 50% of the earning power of the
Company and its Subsidiaries shall be determined by reference to the
mathematical average of the operating income resulting from the operations of
the Company and its Subsidiaries for the two most recent full fiscal years as
set forth in the consolidated and consolidating financial statements of the
Company and its Subsidiaries for such years; provided, however, that if the
Company has, during such period, engaged in one or more transactions to which
purchase accounting is applicable, such determination shall be made by reference
to the pro forma operating income of the Company and its Subsidiaries giving
effect to such transactions as if they had occurred at the commencement of such
two-year period.
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Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue or distribute
Right Certificates which evidence fractional Rights. If, on the Distribution
Date or thereafter, as a result of any adjustment effected pursuant to Section
11(i) or otherwise hereunder, a Person would otherwise be entitled to receive a
Right Certificate evidencing a fractional Right, the Company shall, in lieu
thereof, pay or cause to be paid to such Person an amount in cash equal to the
same fraction of the current market value of a whole Right. For the purpose of
this Section 14(a), the current market value of a whole Right shall be the
Closing Price of the Rights for the Trading Day immediately prior to the date on
which such fractional Rights would have been otherwise issuable.
(b) The Company shall not be required to issue fractions of
Class A Shares upon exercise of the Rights or to distribute scrip or
certificates which evidence fractional Class A Shares. If, on the Distribution
Date or thereafter, a Person would otherwise be entitled to receive a fractional
Class A Share, the Company shall in lieu thereof pay to such Person at the time
such Right is exercised as herein provided an amount in cash equal to the same
fraction of the current market value of one Class A Share. For purposes of this
Section 14(b), the current market value of a Class A Share shall be the Closing
Price of a Class A Share for the Trading Day immediately prior to the date of
such exercise.
(c) Should any adjustment contemplated by Section 11(a)(ii) or
any mandatory redemption and exchange contemplated by Section 24 occur, the
Company shall not be required to issue fractions of Class A Shares upon exercise
of the Rights or to distribute scrip or certificates which evidence fractional
Class A Shares. If after any such adjustment or mandatory redemption and
exchange, a Person would otherwise be entitled to receive a fractional Class A
Share of the Company upon exercise of any Right Certificate or upon mandatory
redemption and exchange as contemplated by Section 24, the Company shall, in
lieu thereof, pay to such Person at the time such Right is exercised as herein
provided or upon such mandatory redemption and exchange an amount in cash equal
to the same fraction of the current market value of one Class A Share. For
purposes of this Section 14(c), the current market value of a Class A Share
shall be the Closing Price of a Class A Share for the Trading Day immediately
prior to the date of such exercise or the date of such mandatory redemption and
exchange.
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(d) The holder of a Right by the acceptance thereof expressly
waives his right to receive any fractional Rights or any fractional shares upon
exercise or mandatory redemption and exchange of a Right.
Section 15. Rights of Action.
(a) All rights of action in respect of the obligations and
duties owed to the holders of the Rights under this Agreement are vested in the
registered holders of the Rights; and, without the consent of the Rights Agent
or of the holder of any other Rights, any registered holder of any Rights may,
on his own behalf and for his own benefit, enforce, and may institute and
maintain any suit, action or proceeding, judicial or otherwise, against the
Company to enforce, or otherwise to act in respect of, such holder's right to
exercise such Rights in the manner provided in the Right Certificate evidencing
such Rights 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.
(b) No right or remedy herein conferred upon or reserved to the
registered holder of Rights is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy, whether hereunder or otherwise, shall not
prevent the concurrent assertion or employment of any other appropriate right or
remedy.
(c) No delay or omission of any registered holder of Rights to
exercise any right or remedy accruing hereunder shall impair any such right or
remedy or constitute a waiver of any default hereunder or an acquiescence
therein. Every right and remedy given hereunder or by law to such holders may be
exercised from time to time, and as often as may be deemed expedient, by such
holders.
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Section 16. Agreement of Right Holders. Every holder of a Right, by
accepting the same, consents and agrees with the Company and the Rights Agent
and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Class A Shares;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the Corporate Trust Office of the Rights Agent duly endorsed or accompanied by a
proper instrument of transfer, along with such other and further documentation
as the Rights Agent may reasonably request;
(c) the Company and the Rights Agent may deem and treat the
person in whose name the Right Certificate (or, prior to the Distribution Date,
the associated Class A Share certificate) is registered as the absolute owner
thereof and of the Rights evidenced thereby (notwithstanding any notations of
ownership or writing on the Right Certificates or the associated Class A Share
certificate made by anyone other than the Company or the Rights Agent) for all
purposes, and nether the Company nor the Rights Agent shall be affected by any
notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any holder
of a Right or other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority prohibiting or otherwise restraining
performance of such obligation; provided that the Company must use its best
efforts to have any such order, decree or ruling lifted or otherwise overturned
as soon as possible.
Section 17. Right Certificate Holder Not Deemed a Stockholder. No
holder, as such, of any Right (whether or not then evidenced by a Right
Certificate) shall be entitled to vote, receive dividends or be deemed for any
purpose the holder of Class A Shares or any other securities of the Company
which may at any time be issuable on the exercise (or mandatory
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<PAGE> 29
redemption and exchange) of the Rights represented thereby, nor shall anything
contained herein or in any Right Certificate be construed to confer upon any
such holder, as such, any of the rights of a stockholder of the Company,
including without limitation any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof, to give or
withhold consent to any corporate action, to receive notice of meetings or other
actions affecting stockholders (except as provided in Section 25) or to receive
dividends or subscription rights until the Right or Rights evidenced by such
Right Certificate shall have been exercised (or mandatorily redeemed and
exchanged) in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent such
compensation as shall be agreed to in writing between the Company and the Rights
Agent 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 expenses 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
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 in the premises. In no case shall the Rights Agent be liable for
special, indirect, incidental or consequential loss or damage of any kind
whatsoever, even if the Rights Agent has been advised of the likelihood of such
loss or damage.
(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 Right
Certificate or certificate for Class A Shares or 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 executed by the proper
person or persons and, where necessary, verified or acknowledged, or otherwise
upon the advice of its counsel as set forth in Section 19 hereof.
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(c) The provisions of this Section 18 shall survive the
expiration of the Rights and the termination of this Agreement.
Section 19. Duties of Rights Agent. The Rights Agent undertakes the
duties and obligations expressly imposed by this Agreement, and no implied
duties or obligations shall be read into this Agreement against the Rights
Agent, upon the following terms and conditions, by all of which the Company and
the holders of Right Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel of its
selection (who may be legal counsel for the Company), and the opinion of such
counsel shall be full and complete authorization and protection to the Rights
Agent as to any action taken or omitted by it in good faith and in accordance
with such opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that any fact or
matter be proved or established by the Company prior to taking or suffering any
action hereunder, such fact or matter (unless other evidence in respect thereof
be herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by any one of the Chairman, the President,
any Vice President, the Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary of the Company and delivered to the Rights Agent, and such
certificate shall be full authorization to the Rights Agent for any action taken
or suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder to the Company
or any other Person only for its own negligence, bad faith or willful
misconduct.
(d) The Rights Agent shall not be liable for or by reason of
any of the statements of fact or recitals contained in this Agreement or in the
Right Certificates (except its authentication thereof) or be required to verify
the same, but all such statements and recitals are and shall be deemed to have
been made by the Company only.
(e) The Rights Agent shall not have any responsibility with
respect to the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or with respect to the
validity or execution of any Right Certificate (except
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<PAGE> 31
its authentication thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement or in any Right
Certificate; nor shall it be responsible for any change in the exercisability of
the Rights (including the Rights becoming void pursuant to Section 11(a)(ii)
hereof) or any adjustment in the terms of the Rights (including the manner,
method or amount thereof) provided for in Sections 3, 11, 13, 23 and 24, or the
ascertainment of the existence of facts that would require any such change or
adjustment (except with respect to the exercise of Rights evidenced by Right
Certificates after actual notice that such change or adjustment is required);
nor shall it by any act hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any Class A Shares to be
issued pursuant to this Agreement or any Right Certificate or as to whether any
Class A Shares will, when issued, be duly authorized, validly issued, fully paid
and nonassessable; nor shall the Rights Agent be responsible for the legality of
the terms hereof in its capacity as an administrative agent.
(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
one of the Chairman, the President, any Vice President, the Treasurer, any
Assistant Treasurer, the Secretary or any Assistant Secretary of the Company,
and to apply to such officers for advice or instructions in connection with its
duties, and it shall not be liable for any action taken or suffered to be taken
by it in good faith in accordance with instructions of any such officer or for
any delay in acting while waiting for those instructions. Any application by the
Rights Agent for written instructions from the Company may, at the option of the
Rights Agent, set forth in writing any action proposed to be taken or omitted by
the Rights Agent under this Agreement and the date on and/or after which such
action shall be taken or such omission shall be effective. The Rights Agent
shall not be liable for any action taken by, or omission of, the Rights Agent in
accordance with a proposal included in such application on or after the date
specified in such application (which date shall not be less than three Business
Days after the date any officer of the Company
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actually receives such application, unless any such officer shall have consented
in writing to any earlier date) unless prior to taking any such action (or the
effective date in the case of an omission), the Rights Agent shall have received
written instructions in response to such application specifying the action to be
taken or omitted.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transection 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.
(i) The Rights Agent may execute and exercise any of the rights
or powers hereby vested in it or perform any duty hereunder either itself or by
or through its attorneys or agents, and the Rights Agent shall not be answerable
or accountable for any act, default, neglect or misconduct of any such attorneys
or agents or for any loss of the Company resulting from any such act, default,
neglect or misconduct provided reasonable care was exercised in the selection
and continued employment thereof.
(j) No provision of this Agreement shall require the Rights
Agent to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder or in the exercise of its
rights if there shall be reasonable grounds for believing that repayment of such
funds or adequate indemnification against such risk or liability is not
reasonably assured to it.
(k) If, with respect to any Right Certificate surrendered to the
Rights Agent for exercise or transfer, the portion of the form of assignment or
form of election to purchase (as the case may be) certifying that the Rights are
not beneficially owned by an Acquiring Person or an Affiliate or Associate
thereof has not been completed or indicates that such Rights are beneficially
owned by such Person, the Rights Agent shall not take any further action with
respect to such requested exercise or transfer without the written consent of
the Company.
(l) In addition to the foregoing, the Rights Agent shall be
protected and shall incur no liability for, or in respect of, any action taken
or omitted by it in connection with its administration of this Agreement if such
acts or omissions are in reliance upon (i) the proper
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<PAGE> 33
execution of the certification concerning beneficial ownership appended to the
form of assignment and the form of election to exercise attached to any Right
Certificate unless the Rights Agent shall have actual knowledge that, as
executed, such certification is untrue, or (ii) the non-execution of such
certification including, without limitation, any refusal to honor any otherwise
permissible assignment or election by reason of such non-execution.
(m) The Company agrees to give the Rights Agent prompt written
notice of any event or ownership which would prohibit the exercise or transfer
of the Right Certificates.
Section 20. 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 shall be a party, or any corporation succeeding to
the corporate trust business of the Rights Agent or any successor Rights Agent,
shall be the successor to the Rights Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation would be eligible for appointment
as a successor Rights Agent under the provisions of Section 21. If at the time
such successor Rights Agent shall succeed to the agency created by this
Agreement any of the Right Certificates shall have been authenticated but not
delivered, any such successor Rights Agent may adopt the authentication of the
predecessor Rights Agent and deliver such Right Certificates so authenticated,
and, if at that time any of the Right Certificates shall not have been
authenticated, any successor Rights Agent may authenticate such Right
Certificates either in the name of the predecessor Rights Agent or in the name
of the successor Rights Agent; and in all such cases such Right Certificates
shall have the full force provided in the Right Certificates and in this
Agreement.
(b) If at any time the name of the Rights Agent shall be changed
and at such time any of the Right Certificates shall have been authenticated but
not delivered, the Rights Agent may adopt the authentication under its prior
name and deliver Right Certificates so authenticated; and, in case at that time
any of the Right Certificates shall not have been authenticated, the Rights
Agent may authenticate such Right Certificates either in its prior name
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<PAGE> 34
or in its changed name; and in all such cases such Right Certificates shall have
the full force provided in the Right Certificates and in this Agreement.
Section 21. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Agreement
upon 30 days' notice in writing mailed to the Company by first-class mail. The
Company may remove the Rights Agent or any successor Rights Agent upon 30 days'
notice in writing, mailed to the Rights Agent or successor Rights Agent, as the
case may be, by first-class mail. If the Rights Agent shall resign or be removed
or shall otherwise become incapable of acting, the Company shall appoint a
successor to the Rights Agent. If the Company shall fail to make such
appointment within a period of 30 days after giving notice of such removal or
after it has been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the registered holder of a Right
Certificate (or, prior to the Distribution Date, of Class A Shares), then the
Rights Agent or any registered holder of a Right Certificate (or, prior to the
Distribution Date, of Class A Shares) 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 (i) a
corporation organized and doing business under the laws of the United States or
of any state of the United States, which is authorized under such laws to
exercise corporate trust powers 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 million or (ii) an
affiliate of such a corporation. After appointment, the successor Rights Agent
shall be vested with the same powers, rights, duties and responsibilities as if
it had been originally named as Rights Agent without further act or deed; but
the predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment, the Company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer agent for
the Class A Shares and mail a notice thereof in writing to the registered
holders of the Right Certificates. Failure to give any notice provided for in
this Section 21, however, or any defect
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therein, shall not affect the legality or validity of the resignation or removal
of the Rights Agent or the appointment of the successor Rights Agent, as the
case may be.
Section 22. Issuance of New Right Certificates. Notwithstanding any of
the provisions of this Agreement or of the Rights to the contrary, the Company
may, at its option, issue new Right Certificates evidencing Rights in such form
as may be approved by its Trustees to reflect any adjustment or change in the
Purchase Price per share and the number, kind or class of shares or other
securities purchasable under the Right Certificates made in accordance with the
provisions of this Agreement.
Section 23. Redemption.
(a) The Rights may be redeemed by action of the Trustees
pursuant to paragraph (b) of this Section 23, or may be redeemed and exchanged
by action of the Trustees pursuant to Section 24 herein, but shall not be
redeemed in any other manner.
(b) The Company may, at its option, at any time up to and
including the Close of Business on the tenth Business Day after the Share
Acquisition Date, redeem all but not less than all the then outstanding Rights
at a redemption price of one cent ($.01) per Right then outstanding,
appropriately adjusted to reflect any adjustment in the number of Rights
outstanding pursuant to Section 11(i) herein. Any such redemption of the Rights
by the Trustees may be made effective at such time, on such basis and with such
conditions as the Trustees in their sole discretion may establish.
(c) The right of the registered holders of Right Certificates to
exercise the Rights evidenced thereby or, if the Distribution Date has not
theretofore occurred, the inchoate right of the registered holders of Rights to
exercise the same shall, without notice to such holders or to the Rights Agent
and without further action, terminate and be of no further force or effect
effective as of the time of adoption by the Trustees of a resolution authorizing
and directing the redemption of the Rights pursuant to paragraph (b) of this
Section 23 (or, alternatively, if the Trustees qualified such action as to time,
basis or conditions, then at such time, on such basis and with such conditions
as the Trustees may have established pursuant to such paragraph (b));
thereafter, the only right of the holders of Rights shall be to receive the
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Redemption Price. The Company shall promptly give public notice of any
redemption resolution pursuant to paragraph (b) of this Section 23; provided,
however, that the failure to give, or any defect in, any such notice shall not
affect the validity of such redemption. Within 10 days after the adoption of any
redemption resolution pursuant to paragraph (b) of this Section 23, the Company
shall give notice of such redemption to the Rights Agent and to the holders of
the then outstanding Rights by mailing such notice to all such holders at their
last addresses as they appear upon the registry books of the Rights Agent or,
prior to the Distribution Date, on the registry books of the transfer agent for
the Class A Shares. Any notice which is mailed in the manner herein provided
shall be deemed given, whether or not the holder receives the notice.
Each such notice of redemption shall state the method by which the payment of
the Redemption Price will be made.
(d) Neither the Company nor any of its Affiliates or Associates
may acquire (other than, in the case of such Affiliates and Associates, in their
capacity as holders of Class A Shares), redeem or purchase for value any Rights
at any time in any manner other than as specifically set forth in this Section
23 or in Section 24 herein, and other than in connection with the purchase of
Class A Shares prior to the Distribution.
(e) Notwithstanding anything contained in this Agreement to the
contrary, the Rights shall not be exercisable after a Person becomes an
Acquiring Person until such time as the Company's right of redemption pursuant
to Section 23(b) has expired.
Section 24. Mandatory Redemption and Exchange.
(a) The Trustees may, at their option, at any time after any
Person becomes an Acquiring Person, cause the Company to issue Class A Shares in
mandatory redemption of, and in exchange for, all or part of the then
outstanding and exercisable Rights (which shall not include Rights that have
become null and void pursuant to the provisions of Section 7(e) hereof) at an
exchange rate of one Class A Share for each two Class A Shares for which each
Right is then exercisable pursuant to the provisions of Section 11(a)(ii)
hereof. Notwithstanding the foregoing, the Trustees shall not be empowered to
effect such redemption and exchange at any time after any Person (other than the
Company, any Subsidiary of the Company, any employee benefit plan of the Company
or of any such Subsidiary, or any trustee of or fiduciary with
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respect to any such plan when acting in such capacity), together with all
Affiliates and Associates of such Person, becomes the Beneficial Owner of 50% or
more of the Class A Shares then outstanding.
(b) Immediately upon the action of the Trustees ordering the
mandatory redemption and exchange of any Rights pursuant to subsection (a) of
this Section 24 and without any further action and without any notice, the right
to exercise such Rights shall terminate and the only right thereafter of a
holder of such Rights shall be to receive such number of Class A Shares as is
provided in paragraph (a) of this Section 24. The Company shall promptly give
public notice of any such redemption and exchange; provided, however, that the
failure to give, or any defect in, such notice shall not affect the validity of
such redemption and exchange. The Company promptly shall mail a notice of any
such redemption and exchange to the Rights Agent and to all the holders of such
Rights at their last addresses as they appear upon the registry books of the
Rights Agent. Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each such notice of
mandatory redemption and exchange shall state the method by which the redemption
and exchange of the Class A Shares for Rights will be effected and, in the event
of any partial redemption and exchange, the number of Rights which will be
redeemed and exchanged. Any partial redemption and exchange shall be effected
pro rata based on the number of Rights (other than Rights which have become null
and void pursuant to the provisions of Section 7(e) hereof) held by each holder
of Rights.
Section 25. Notice of Certain Events.
(a) If the Company shall, on or after the Distribution Date,
propose (a) to make any distribution payable in stock of any class of the
Company or any Subsidiary of the Company to the holders of its Class A Shares;
(b) to offer to the holders of its Class A Shares rights, options or warrants to
subscribe for or to purchase any additional Class A Shares or shares of stock of
any class or any other securities, rights, options or warrants; (c) to make any
other distribution to the holders of its Class A Shares (other than a regular
quarterly cash dividend); (d) to effect any reclassification of its Class A
Shares (other than a reclassification involving only the subdivision of
outstanding Class A Shares); (e) to effect any consolidation or
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merger into or with, or to effect any sale or other transfer (or to permit one
or more of its Subsidiaries to effect any sale or other transfer), in one or
more transactions, of more than 50% of the assets or earning power of the
Company and its Subsidiaries (determined as provided in Section 13 herein) to,
any other Person (other than the Company or a Wholly-Owned Subsidiary or
Wholly-Owned Subsidiaries); (f) to effect the liquidation or winding up of the
Company; or (g) if the Rights have theretofore become exercisable with respect
to Class A Shares pursuant to Section 11(a)(ii) herein, to declare or pay any
dividend or other distribution on the Class A Shares payable in Class A Shares
or in stock of any other class of the Company or any Subsidiary of the Company
or to effect a subdivision or combination of the Class A Shares (by
reclassification or otherwise than by payment of dividends in Class A Shares)
then, in each such case, the Company shall give to the Rights Agent and to each
holder of a Right Certificate, in accordance with Section 27 hereof, notice of
such proposed action, which shall specify the date of authorization by the
Trustees of, and record date for, such stock dividend or such distribution of
rights or warrants or the date on which such reclassification, consolidation,
merger, sale, transfer, liquidation, dissolution, winding up, subdivision or
combination is to take place and the date of participation therein by the
holders of the Class A Shares if any such date is to be fixed. Such notice shall
be so given in the case of any action covered by clause (a), (b), (c) or (g)
above at least 20 days prior to the record date for determining holders of the
Class A Shares, for purposes of such action, and in the case of any such other
action, at least 20 days prior to the date of the taking of such proposed action
or the date of participation therein by the holders of the Class A Shares,
whichever shall be the earlier.
Section 26. Listing; Securities Laws Registrations.
(a) So long as the Class A Shares issuable upon the exercise of
Rights may be listed on any United States national securities exchange or
authorized for quotation on any interdealer quotation system of any securities
association, the Company shall use its best efforts to cause, from and after
such time as the Rights become exercisable, all shares reserved for such
issuance to be listed on such exchange or quoted on such system upon official
notice of issuance upon such exercise.
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(b) The Company shall (i) prepare and file as soon as is
required by law following the Distribution Date a registration statement under
the Securities Act of 1933, as amended (the "Securities Act"), with respect to
the Class A Shares or other securities purchasable upon exercise of the Rights
on an appropriate form, (ii) use its best efforts to cause such registration
statement to become effective as soon as practicable after such filing, and
(iii) use its best efforts to cause such registration statement to remain
effective (with a prospectus at all times meeting the requirements of the
Securities Act) until the earlier of (A) the date as of which the Rights are no
longer exercisable for such securities or (B) the Final Expiration Date. The
Company will also take such action as may be appropriate under, or to ensure
compliance with, the securities or "blue sky" laws of the various states and
other appropriate jurisdictions in connection with the exercisability of the
Rights. The Company may temporarily suspend, for a period of time not to exceed
90 days after the date set forth in clause (i) of the first sentence of this
paragraph, the exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective and to take such action
under such other securities or blue sky laws and permit them to become
effective. Upon any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the suspension is no
longer in effect. Notwithstanding any provision of this Agreement to the
contrary, the Rights shall not be exercisable in any jurisdiction if the
requisite qualification in such jurisdiction shall not have been obtained or the
exercise thereof shall not be permitted under applicable law or a registration
statement shall not have been declared effective.
Section 27. Notices. Notices or demands authorized by this Agreement to
be given or made by the Rights Agent or by the holder of any Right Certificate
to or on the Company shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed (until another address is filed in writing with
the Rights Agent) as follows:
Angeles Mortgage Investment Trust
340 North Westlake Boulevard
Suite 230
Westlake Village, CA 91362
Attention: Secretary
36
<PAGE> 40
Any notice or demand authorized by this Agreement to be given or made by the
Company or by the holder of any Right Certificate to or on the Rights Agent
shall be sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with the Company)
as follows:
Chase Mellon Shareholders Services, L.L.C.
450 West 33rd Street
Fifteenth Floor
New York, New York 10001
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the Rights
Register of the Company or, prior to the Distribution Date, on the stock
transfer records for the Class A Shares.
Section 28. Supplements and Amendments.
(a) The Company may from time to time supplement or amend this
Agreement (which supplement or amendment shall be evidenced by a writing signed
by the Company and the Rights Agent) without the approval of any holders of
Right Certificates in order to cure any ambiguity, to correct or supplement any
provision contained herein which may be defective or inconsistent with any other
provisions herein, to make any other provisions in regard to matters or
questions arising hereunder, or to add, delete, modify or otherwise amend any
provision, which the Company may deem necessary or desirable, including without
limitation extending the Final Expiration Date and, provided that at the time of
such amendment or supplement the Distribution Date has not occurred, the period
during which the Rights may be redeemed; provided, however, that, from and after
such time as any Person becomes an Acquiring Person, any such amendment or
supplement shall not materially and adversely affect the interests of the
holders of Right Certificates. Without limiting the foregoing, the Trustees may
by resolution adopted at any time prior to such time as any Person becomes an
Acquiring Person amend this Agreement to lower the threshold set forth in the
definitions of Acquiring Person and
37
<PAGE> 41
Distribution Date herein from 20% to a percentage not less than the greater of
(i) any percentage greater than the largest percentage of the outstanding Class
A Shares then known to the Company to be beneficially owned by any Person (other
than the Company, any Subsidiary of the Company, any employee benefit plan of
the Company or of any Subsidiary of the Company, or any trustee of or fiduciary
with respect to any such plan when acting such capacity), and (ii) 10% if the
Trustees shall determine that a Person whose interests are adverse to the
Company and its shareholders may seek to acquire control of the Company.
(b) Notwithstanding any other provision hereof, the Rights
Agent's consent must be obtained regarding any amendment or supplement pursuant
to this Section 28 which alters the Rights Agent's rights or duties.
Section 29. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
Section 30. Determinations and Actions by the Trustees. For all
purposes of this Agreement, any calculation of the number of Class A Shares or
other securities outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding Class A Shares of
which any person is the Beneficial Owner, shall be made in accordance with the
last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations under
the Exchange Act. The Trustees shall have the exclusive power and authority to
administer this Agreement and to exercise all rights and powers specifically
granted to the Trustees or to the Company, or as may be necessary or advisable
in the administration of this Agreement, including, without limitation, the
right and power to (i) interpret the provisions of this Agreement, and (ii) make
all determinations deemed necessary or advisable for the administration of this
Agreement (including a determination to redeem or not redeem the Rights or to
amend the Agreement). All such actions, calculations, interpretations and
determinations (including, for purposes of clause (y) below, all omissions with
respect to the foregoing) which are done or made by the Trustees in good faith,
shall (x) be final, conclusive and binding on the
38
<PAGE> 42
Company, the Rights Agent, the holders of the Rights and all other parties and
(y) not subject the Trustees to any liability to the holders of the Rights.
Section 31. Effect on Class B Shares. Nothing in this Agreement shall
adversely affect the rights of the Class B Shares of the Company as set forth in
the Declaration of Trust of the Company.
Section 32. Benefits of this Agreement. Nothing in this Agreement shall
be construed to give to any Person other than the Company, the Rights Agent and
the registered holders of the Rights any legal or equitable right, remedy or
claim under this Agreement; but this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the registered holders of
the Rights.
Section 33. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated.
Section 34. Governing Law. This Agreement and each Right Certificate
issued hereunder shall be deemed to be a contract made under the laws of the
State of California 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; provided, however, that the rights and
obligations of the Rights Agent shall be governed by and construed in accordance
with the laws of the State of New York.
Section 35. 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.
39
<PAGE> 43
Section 36. Descriptive Headings. Descriptive headings of the several
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and attested, all as of the day and year first above written.
ANGELES MORTGAGE INVESTMENT TRUST
Attest:
By: /s/ Anna Merguerian By: /s/ Ronald J. Consiglio
------------------------- --------------------------------
Title: Secretary Title: President
CHASE MELLON SHAREHOLDER
SERVICES, L.L.C.
As Rights Agent
Attest:
By: /s/ Laura Picone By: /s/ Patricia Zakrzewski
------------------------- --------------------------------
Title: Authorized Officer Authorized Officer
40
<PAGE> 44
EXHIBIT A
[Form of Right Certificate]
Certificate No. R- _____ Rights
NOT EXERCISABLE AFTER DECEMBER 31, 2003 (UNLESS EXTENDED) OR EARLIER IF
REDEMPTION OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT
$.01 PER RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY
ACQUIRING PERSONS (AS DEFINED IN SECTION 1 OF THE RIGHTS AGREEMENT) OR
ANY SUBSEQUENT HOLDER OF SUCH RIGHTS BECOME NULL AND VOID.
RIGHT CERTIFICATE
ANGELES MORTGAGE INVESTMENT TRUST
This certifies that ____________________, or registered assigns, is the
registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the Rights
Agreement, dated as of November 13, 1996 (the Rights Agreements), between
ANGELES MORTGAGE INVESTMENT TRUST, a California business trust (the "Company"),
and CHASE MELLON SHAREHOLDER SERVICES, L.L.C. (the "Rights Agent"), to purchase
from the Company at any time after the Distribution Date (as such term is
defined in the Rights Agreement) and prior to 5:00 p.m., Los Angeles, California
time, on December 31, 2003 (unless extended), at the Corporate Trust Office of
the Rights Agent (or at the office of its successor as Rights Agent), one fully
paid nonassessable Class A Share, $1 par value (the "Class A Shares"), of the
Company, at a purchase price of Sixty Dollars ($60.00) per Class A Share (the
"Purchase Price"), upon presentation and surrender of this Right Certificate
with the Form of Election to Purchase duly executed. The number of Rights
evidenced by this Right Certificate (and the number of Class A Shares which may
be purchased upon exercise hereof) set forth above, and the Purchase Price set
forth above, are the number and Purchase Price as of November 13, 1996, based on
the Class A Shares as constituted at such date. As provided in the Rights
Agreement, the Purchase Price and the number of Class A Shares which may be
purchased upon the exercise of the Rights evidenced by this Right Certificate
are subject to modification and adjustment upon the happening of certain events.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the
<PAGE> 45
Rights Agreement are on file at the principal executive offices of the Company
and the Corporate Trust Office of the Rights Agent.
This Right Certificate, with or without other Right Certificates, upon
surrender at the Corporate Trust Office of the Rights Agent, may be exchanged
for another Right Certificate or Right Certificates of like tenor and date
evidencing Rights entitling the holder to purchase a like aggregate number of
Class A Shares as the Rights evidenced by the Right Certificate or Right
Certificates surrendered shall have entitled such holder to purchase. If this
Right Certificate shall be exercised in part, the holder shall be entitled to
receive upon surrender hereof another Right Certificate or Right Certificates
for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Certificate (i) may be redeemed by the Company at a redemption price of
$.01 per Right or (ii) may be exchanged by the Company in whole or in part for
Class A Shares.
No fractional Class A Shares will be issued upon the exercise of any
Right or Rights evidenced hereby, but in lieu thereof a cash payment will be
made as provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Class A Shares
or of any other securities of the Company which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any of the rights
of a stockholder of the Company or any right to vote for the election of
Trustees or upon any matter submitted to stockholders at any meeting thereof, or
to give or withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting stockholders (except as provided in the
Rights Agreement), or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by this Right Certificate shall have been
exercised as provided in the Rights Agreement.
This Right Certificate shall not be entitled to any benefit under the
Rights Agreement or be valid or obligatory for any purpose until it shall have
been authenticated by the Rights Agent.
WITNESS the facsimile signatures of the proper officers of the Company
and its corporate seal.
Dated as of __________________________
ATTEST: ANGELES MORTGAGE INVESTMENT TRUST
_______________________________ By:________________________________
Secretary President
2
<PAGE> 46
This is one of the Right Certificates referred to in the
within-mentioned Rights Agreement.
CHASE MELLON SHAREHOLDER SERVICES, L.L.C.,
as Rights Agent
By: _____________________________________________
Authorized Signatory
3
<PAGE> 47
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder
desires to transfer the Right Certificate)
FOR VALUE RECEIVED, _________________________________ hereby sells,
assigns and transfers unto ____________________________________________________
_______________________________________________________________________________
(Please print name and address of transferee)
________________________________________________________________________ this
Right Certificate, together with all right, title and interest therein, and does
hereby irrevocably constitute and appoint _________________________ Attorney, to
transfer the Right Certificate on the books of the within-named Company, with
full power of substitution.
Dated as of _____________________, _________.
__________________________________________
Signature
Signature Guarantee:
Signatures must be guaranteed.
________________________________________________________________________________
[To be executed if statement is correct]
The undersigned hereby certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).
__________________________________________
Signature
4
<PAGE> 48
[Form of Reverse Side of Right Certificate - continued]
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise the Right Certificate)
TO ANGELES MORTGAGE INVESTMENT TRUST:
The undersigned hereby irrevocably elects to exercise
___________________ Rights represented by this Right Certificate to purchase the
Class A Shares (or other securities) issuable upon the exercise of such Rights
and requests that certificates for such Class A Shares (or other securities) be
issued in the name of:
Please insert social security or other identifying number:
_____________________________
________________________________________________________________________________
(Please print name and address)
If such number of Rights shall not be all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:
Please insert social security or other identifying number:
_____________________________
________________________________________________________________________________
(Please print name and address)
Dated as of _____________, _____.
__________________________________________
Signature
5
<PAGE> 49
[Form of Reverse Side of Right Certificate - continued]
Signature Guaranteed:
Signatures must be guaranteed.
________________________________________________________________________________
[To be executed if statement is correct]
The undersigned hereby certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).
__________________________________________
Signature
The signature in the foregoing Form of Assignment or Form of Election
to Purchase must conform to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above in the Form of
Assignment or the Form of Election to Purchase, as the case may be, is not
completed, the Company and the Rights Agent will deem the beneficial owner of
the Rights evidenced by this Right Certificate to be an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.
6
<PAGE> 50
EXHIBIT B
ANGELES MORTGAGE INVESTMENT TRUST
SHAREHOLDER PLAN
SUMMARY OF RIGHTS TO PURCHASE CLASS A SHARES
On November 12, 1996, the Trustees of Angeles Mortgage Investment Trust
(the "Company") authorized the distribution of one Right for each outstanding
Class A Share of the Company ("Class A Shares"). The distribution is to be made
to the stockholders of record on November 18, 1996 (the "Record Date") and, in
addition, the Company has authorized the issuance of one Right with respect to
each Class A Share that shall become outstanding between the Record Date and the
earliest of the Distribution Date, the Redemption Date or the Final Expiration
Date (as such terms are hereinafter defined). When exercisable, each Right
entitles the registered holder to purchase from the Company one Class A Share
(or other shares, securities or property, as the case may be, of equivalent
value) at the initial price of $60.00 per Share (the "Purchase Price"), subject
to adjustment. However, if a person becomes an Acquiring Person (as hereinafter
defined) holders (other than Acquiring Persons) can exercise at a price equal to
one-half of the market value of the Class A Shares. The description and terms of
the rights are set forth in a Rights Agreement (the "Rights Agreement") between
the Company and Chase Mellon Shareholder Services, L.L.C. (the "Rights Agent").
Initially, the Rights will be evidenced by the certificates
representing Class A Shares then outstanding, no separate Right Certificates
will be distributed and the Rights will not be tradeable separate from the Class
A Shares. The Rights will become exercisable and will separate from the Class A
Shares upon the earlier of (i) ten business days after a public announcement
that a person or group of affiliated or associated persons (an "Acquiring
Person") has acquired beneficial ownership of 20% or more of the outstanding
Class A Shares (the "Share Acquisition Date") or (ii) ten business days (or a
later date as determined by the Trustees) after the commencement of, or first
public announcement of an intention to commence, a tender offer or exchange
offer that would result in a person or group beneficially owning 20% or more of
the outstanding Class A Shares (the earlier of such dates being called the
"Distribution Date").
<PAGE> 51
Until the Distribution Date (or earlier redemption or expiration of the
Rights), (i) the Rights will be evidenced by the Class A Share certificates and
will be transferred with and only with such Class A Share certificate, (ii) new
Class A Share certificates issued after the Record Date will contain in
accordance with the Rights Agreement a notation incorporating the Rights
Agreement by reference, and (iii) the surrender or transfer of any certificates
for Class A Shares outstanding will also constitute the transfer of the Rights
associated with the Class A Shares represented by such certificate.
The Rights are not exercisable until the Distribution Date and will
expire at the close of business on December 31, 2003 (the "Final Expiration
Date"), unless the Final Expiration Date is extended or the Rights are earlier
redeemed or exchanged by the Company as described below.
As soon as practicable after the Distribution Date, Right Certificates
will be mailed to holders of record of the Class A Shares as of the close of
business on the Distribution Date, and thereafter, the separate Right
Certificates alone will represent the Rights. Only Class A Shares issued prior
to the Distribution Date will be issued with Rights.
In the event that a Person becomes an Acquiring Person, each holder of
a Right will thereafter have the right to receive, upon exercise, Class A Shares
(or in certain circumstances cash, property or other securities of the Company)
having a value equal to two times the Purchase Price of the Right.
Notwithstanding the foregoing, following the occurrence of such an event, all
Rights that are or (under certain circumstances specified in the Rights
Agreement) were beneficially owned by any Acquiring Person will be null and
void.
After the Share Acquisition Date, in the event that (i) the Company
consolidates or merges with any other person and the Company is not the
surviving corporation; (ii) any person engages in a share exchange,
consolidation or merger with the company were the outstanding Class A Shares are
exchanged for securities, cash or property of the other person and the Company
is the surviving corporation; or (iii) 50% or more of the Company's assets or
earning power is sold or transferred, proper provision will be made so that each
holder of a Right (other than Rights owned by an Acquiring Person, which will
have become null and void) will thereafter have the right to receive, upon
exercise, common stock of the acquiring company having a value equal to two
times the Purchase Price of the Right.
2
<PAGE> 52
The Purchase Price payable, and the number of Class A Shares or other
securities, cash or property issuable, upon exercise of the Rights are subject
to customary adjustments from time to time to prevent dilution in the event of
certain changes in the shares of the Company. With certain exceptions, no
adjustment in the Purchase Price will be required until cumulative adjustments
amount to an increase or decrease of at least 1% in the Purchase Price. The
Company may determine not to issue fractional Rights or shares, and in lieu
thereof, an adjustment in cash will be made based on the market value of the
Rights or shares on the last trading date prior to the date of exercise.
In general, the Company may redeem the Rights in whole, but not in
part, at a price of $.01 per Right (subject to adjustment) (the "Redemption
Price"), at any time before the close of business on the tenth business day
following the Share Acquisition Date. The redemption of the Rights may be made
effective at such time, on such basis and with such conditions as the Trustees
in their sole discretion may establish. Immediately upon the action of the
Trustees ordering redemption of the Rights (the "Redemption Date"), the Rights
will terminate and the only right of the holders of Rights will be to receive
the redemption price.
At any time after any person becomes an Acquiring Person and prior to
the acquisition by any person of 50% or more of the outstanding Class A Shares,
the Trustees may exchange the then outstanding and exercisable Rights (other
than Rights owned by an Acquiring Person, which will have become null and void),
in whole or in part, for Class A Shares, at an exchange ratio of one Class A
Share for each two Class A Shares for which each Right is then exercisable,
subject to adjustment.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends.
The offer and sale of the Class A Shares issuable upon exercise of the
Rights will be registered with the Securities and Exchange Commission but such
registration will not be effective until the Rights become exercisable. The
Rights are listed on the American Stock Exchange. As described above, however,
the rights will not be transferable separately from the Class A Shares until the
Distribution Date.
3
<PAGE> 53
The terms of the Rights may be amended by the Trustees without the
consent of the holders of the Rights, including an amendment to extend the Final
Expiration Date and, provided a Distribution Date has not occurred, to extend
the period during which the Rights may be redeemed, except that after the
Distribution Date no such amendment may materially and adversely affect the
interests of the holders of the Rights.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
without conditioning the offer on a substantial number of Rights being acquired.
Accordingly, the existence of the Rights may deter certain acquirors from making
takeover proposals or tender offers. However, the rights plan helps ensure that
the Company's shareholders receive fair and equal treatment in the event of any
proposed takeover of the Company. The adoption of the plan is not in response to
any specific takeover threat or proposal, but is a precaution taken to protect
the rights of the Company's shareholders.
A copy of the Rights Agreement will be filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A. Once
the Rights are issued, a copy of the Rights Agreement will be available to
registered holders of the Rights upon written request free of charge from the
Rights Agent. This summary description of the Rights does not purport to be
complete and is qualified in its entirety by reference to the Rights Agreement,
which is incorporated herein by reference.
4
