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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-A/A
AMENDMENT NO. 1
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
HOMEBASE, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware 33-0109661
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(State of Incorporation or Organization) (IRS Employer Identification no.)
3345 Michelson Drive, Irvine, CA 92612
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(Address of Principal Executive Offices) (Zip Code)
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<S> <C>
If this form relates to the registration of If this form relates to the registration of
securities pursuant to Section 12(b) of the securities pursuant to Section 12(g) of the
Exchange Act and is effective pursuant to Exchange Act and is effective pursuant to
General Instruction A.(c), please check the General Instruction A.(d), please check the
following box. [X] following box. [_]
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Securities to be registered pursuant to Section 12(b) of the Act:
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Title of each class Name of each exchange on which
to be so registered each class is to be registered
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Preferred Stock Purchase Rights The New York Stock Exchange
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Securities Act registration statement file number to which this form relates:
N/A
Securities to be registered pursuant to Section 12(g) of the Act:
None
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(Title of Class)
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Item 1. Description of Registrant's Securities to be Registered.
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On April 5, 1999, the Board of Directors of HomeBase, Inc. (the "Company")
declared a dividend of one right (a "Right") for each outstanding share of the
Company's Common Stock, par value $.01 per share, or one share of each class of
the Company's common stock having the right to vote generally in the election of
directors (the "Common Shares"), to be distributed on April 6, 1999 to
stockholders of record at the close of business on April 5, 1999 (the "Record
Date"). Each Right entitles the holder thereof to purchase one one-thousandth
(1/1000) (subject to adjustment) of a share of its Series A Junior Participating
Preferred Stock, par value $0.01 per share, having the rights, preferences,
privileges and restrictions described in Section 5(a) below (the "Preferred
Shares"), and, under certain circumstances, other securities or property. The
description and terms of the Rights are set forth in a Rights Agreement (the
"Rights Agreement") dated as of April 6, 1999 by and between the Company and
First Chicago Trust Company of New York, as Rights Agent.
The following is a brief description of the Rights. It is intended to
provide a general description only and is qualified in its entirety by reference
to the Rights Agreement which is incorporated by reference herein as
Exhibit 99.1.
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1. Common Share Certificates Representing Rights
Until the Distribution Date (as defined in Section 2 below), (a) the
Rights shall not be exercisable, (b) the Rights shall be attached to and trade
only together with the Common Shares and (c) the stock certificates representing
Common Shares shall also represent the Rights attached to such Common Shares.
Common Share certificates issued after the Record Date and prior to the
Distribution Date shall contain a notation incorporating the Rights Agreement by
reference.
2. Distribution Date
The "Distribution Date" is the earliest of (a) the tenth business day
(or such later day as shall be designated by the Board of Directors) following
the date of commencement or the public announcement of the intent of any Person
(as hereinafter defined), other than an Exempt Person (as hereinafter defined),
to commence a tender offer or exchange offer, the consummation of which would
cause any Person to be the beneficial owner of 15% or more of the outstanding
Common Shares (upon such consummation such Person is a "15% Stockholder", and
the first date of public announcement that makes it immediately apparent that
such Person has become a 15% Stockholder is the "15% Ownership Date"), (ii) the
date of the first Section 11(a)(ii) Event (as hereinafter defined), or (iii) the
date of the first Section 13(a) Event (as hereinafter defined). In calculating
the percentage of outstanding Common Shares that are beneficially owned by any
Person, such Person shall be deemed to beneficially own any Common Shares
issuable upon the exercise, exchange or conversion of any options, warrants or
other securities beneficially owned by such Person; provided, however, that such
Common Shares issuable upon such exercise shall not be deemed outstanding for
the purpose of calculating the percentage of Common Shares that are beneficially
owned by any other Person. A "Section 11(a)(ii) Event" shall mean the event that
a 15% Ownership Date shall have occurred and neither the Redemption Date (as
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hereinafter defined) nor the Expiration Date (as hereinafter defined) shall have
occurred prior to the tenth business day following such 15% Ownership Date.
The "Redemption Date" shall mean the date of the action of the Board of
Directors of the Company authorizing and directing the redemption of the Rights.
The "Expiration Date" shall mean the tenth anniversary of the date of the Rights
Agreement. A "Section 13(a) Event" shall mean any event that, at any time on or
after the 15% Ownership Date and prior to the earlier of the Redemption Date or
the Expiration Date, (1) the Company shall, directly or indirectly, consolidate
with or merge with and into any other Person and the Company shall not be the
continuing or surviving corporation in such consolidation or merger, (2) any
Person shall, directly or indirectly, consolidate with or merge with and into
the Company and the Company shall be the continuing or surviving corporation in
such merger and, in connection with such merger, all or part of the Common
Shares shall be changed into or exchanged for stock or other securities of any
Person or cash or any other property, or (3) the Company and/or any one or more
of its subsidiaries shall, directly or indirectly, sell or otherwise transfer,
in one or more transactions (other than transactions in the ordinary course of
business), assets or earning power aggregating more than 50% of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to any
Person or Persons other than the Company or one or more of its wholly-owned
Subsidiaries (such Persons, together with the Persons described in clauses (1)
and (2) above shall be collectively referred to as the "Surviving Person." A
"Person" shall mean any individual, firm, partnership, corporation, association,
group (as such term is used in Rule 13d-5 promulgated under the Securities
Exchange Act of 1934, as amended, as in effect on the date of the Rights
Agreement) or other entity, and shall include any successor (by merger or
otherwise) of any such entity. An "Exempt Person" shall mean the Company, any
wholly-owned subsidiary of the Company, any employee benefit plan of the Company
or of a subsidiary of the Company and any Person holding voting capital stock of
the Company for or pursuant to the terms of any such employee benefit plan.
Upon the close of business on the Distribution Date, the Rights shall
separate from the Common Shares, Right certificates shall be issued, and the
Rights shall become exercisable to purchase Preferred Shares as described in
Section 5 below.
3. Issuance of Right Certificates
As soon as practicable following the Distribution Date, separate
certificates representing only Rights shall be mailed to the holders of record
of Common Shares as of the close of business on the Distribution Date, and such
separate Right certificates alone shall represent such Rights from and after the
Distribution Date.
4. Expiration of Rights
The Rights shall expire on the tenth anniversary of the date of the
Rights Agreement, unless earlier redeemed or exchanged.
5. Exercise of Rights
Unless the Rights have expired or been redeemed or exchanged, they may
be exercised, at the option of the holders, pursuant to paragraphs (a), (b) or
(c) below. No Right may be exercised more than once or pursuant to more than one
of such paragraphs. From and after the first Section 11(a) (ii) Event or the
first Section 13 (a) Event, each Right that, at any time on or after the
Distribution Date, was or is beneficially owned by a 15% Stockholder shall
be null and void, whether held or beneficially owned by the 15% Stockholder or
subsequently, by any other Person.
(a) Right to Purchase Preferred Shares. From and after the close of
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business on the Distribution Date, each Right (other than a Right that has
become void) shall be
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exercisable to purchase one one-thousandth of a Preferred
Share, at an initial exercise price of $50 (Fifty Dollars) (the "Exercise
Price").
Prior to the Distribution Date, the Company may substitute for all or
any portion of the Preferred Shares that would otherwise be issuable upon
exercise of the Rights, cash, securities or other property having the same
aggregate Current Market Price (as defined in Section 1(h) of the Rights
Agreement) as such Preferred Shares.
The Company has authorized 1,900,000 Preferred Shares for issuance
upon exercise of the Rights. The Preferred Shares are nonredeemable and, unless
otherwise provided in connection with the creation of a subsequent series of
preferred stock, are subordinate to any other series of the Company's preferred
stock whether issued before or after the issuance of the Preferred Shares. The
holder of a Preferred Share is entitled to receive, when, as and if declared,
quarterly dividends payable in cash on the 1st day of March, June, September,
and December of each year ("Quarterly Dividend Payment Date"), commencing on the
first Quarterly Dividend Payment Date after the first issuance of a Preferred
Share, in an amount per share (rounded to the nearest cent) equal to the greater
of (i) $1.00 or (ii) subject to adjustment, 1,000 times the aggregate per share
amount of all cash dividends, and 1,000 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other distributions other than a
dividend payable in Common Shares or a subdivision of the outstanding Common
Shares (by reclassification or otherwise), declared on the Common Shares since
the immediately preceding Quarterly Dividend Payment Date, or, with respect to
the first Quarterly Dividend Payment Date, since the first issuance of any share
or fraction of a Preferred Share.
In the event of liquidation, the holders of Preferred Shares shall be
entitled to receive a liquidation payment of $1,000 per Preferred Share plus an
amount equal to accrued and unpaid dividends and distributions thereon, whether
or not declared, to the date of such payment (the "Liquidation Preference").
Following the payment of the full amount of the Liquidation Preference, no
additional distributions shall be made to the holders of Preferred Shares
unless, prior thereto, the holders of Common Shares shall have received an
amount per share (the "Common Adjustment") equal to the quotient obtained by
dividing (i) the Liquidation Preference by (ii) 1,000 (as appropriately adjusted
as set forth in subparagraph (c) below to reflect such events as stock splits,
stock dividends and recapitalizations with respect to the Common Stock) (such
number in clause (ii), the "Adjustment Number"). Following the payment of the
full amount of the Liquidation Preference and the Common Adjustment in respect
of all outstanding Preferred Shares and Common Shares, respectively, holders of
Preferred Shares and holders of Common Shares shall receive their ratable and
proportionate share of remaining assets to be distributed in the ratio of the
Adjustment Number to one (1) with respect to such Preferred Stock and Common
Stock, on a per share basis, respectively.
Subject to adjustment, each Preferred Share has 1,000 votes per share,
voting together with the Common Shares. In the event of any merger,
consolidation or other transaction in which Common Shares are exchanged, the
holder of a Preferred Share shall be entitled to receive 1,000 (subject to
adjustment) times the amount received per Common Share. The rights of the
Preferred Shares as to dividends, voting and liquidation preferences are
protected by antidilution provisions. It is
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anticipated that the value of one one-thousandth of a Preferred Share should
approximate the value of one Common Share.
This discussion of the rights, privileges and preferences of the Preferred
Shares is intended to provide a general description only and is qualified in its
entirety by reference to the certificate of Amendment of the Certificate of
Designation, which is attached hereto as Exhibit 99.2.
(b) Right to Purchase Common Shares of the Company. From and after
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the close of business following the occurrence of a Section 11(a)(ii) Event,
each Right (other than a Right that has become void and those beneficially owned
by a 15% Stockholder, which will also be void) shall be exercisable to purchase,
at the Exercise Price (initially $50, subject to adjustment), Common Shares with
a market value equal to two times such Exercise Price. In the sole discretion of
the Board of Directors of the Company, the Company may substitute for all or any
portion of the Common Shares that would otherwise be issuable upon the exercise
of the Rights, cash, assets or other securities of the Company having the same
aggregate Current Market Price as such Common Shares.
(c) Right to Purchase Common Stock of a Successor Corporation. If, on
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or after the occurrence of a Section 13(a) Event, each Right (other than a
Right that has become void and those beneficially owned by a 15% Stockholder,
which will also be void) shall thereafter be exercisable to purchase, at the
Exercise Price (initially $50, subject to adjustment), shares of common stock of
the Surviving Person or purchaser, with an aggregate Current Market Price equal
to two times such Exercise Price.
6. Adjustments to Prevent Dilution
The Exercise Price, the number of outstanding Rights, the number of
votes per Preferred Share and the number of Preferred Shares or Common Shares
issuable upon exercise of the Rights are subject to adjustment from time to time
as set forth in the Rights Agreement in order to prevent dilution. With certain
exceptions, no adjustment in the Exercise Price shall be required until
cumulative adjustments require an adjustment of at least 1.0%.
7. Cash Paid Instead of Issuing Fractional Securities
No fractional securities shall be issued upon exercise of a Right
(other than fractions of Preferred Shares that are integral multiples of one
one-thousandth of a Preferred Share and that may, at the election of the
Company, be evidenced by depositary receipts) and in lieu thereof, an adjustment
in cash shall be made based on the market price of such securities on the last
trading date prior to the date of exercise.
8. Redemption
Until the earliest of (i) the date of the first Section 11(a)(ii)
Event, (ii) the date of the first Section 13(a) Event or (iii) the Expiration
Date, the Board of Directors of the Company may, at its option, authorize and
direct the redemption of all, but not less than all, of the then outstanding
Rights at a redemption price of $.001 per Right, as such redemption price shall
be appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after April 6, 1999 (the "Redemption Price"), and the
Company shall so redeem the Rights. Immediately upon such action by the Board of
Directors (the date of such action is the "Redemption Date"), the sole right of
the holders of Rights thereafter shall be to receive the Redemption Price.
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9. Exchange
At any time during the period of 180 days after a Section 11(a)(ii)
Event, the Board of Directors of the Company may, at its option, authorize and
direct the exchange of all, but not less than all, of the then outstanding
Rights (other than a Right that has become void and those beneficially owned by
a 15% Stockholder, which will also be void) for Common Shares, Preferred Shares,
debt securities of the Company, other property, or any combination of the
foregoing, in each case having an aggregate Current Market Price equal to the
Exercise Price on the record date for such exchange, and the Company shall so
exchange the Rights. Immediately upon such action by the Board of Directors, the
right to exercise Rights shall terminate and the only right of the holders of
Rights thereafter shall be to receive a number of Common Shares or such other
securities or property having an aggregate Current Market Price equal to the
Exercise Price.
10. No Stockholder Rights Prior to Exercise
Until a Right is exercised, the holder thereof, as such, shall have no
rights as a stockholder of the Company (other than rights resulting from such
holder's ownership of Common Shares), including, without limitation, the right
to vote or to receive dividends.
11. Amendment of Rights Agreement
The Board of Directors of the Company may, from time to time, without
the approval of any holders of Rights, supplement or amend any provision of this
Agreement in any manner, whether or not such supplement or amendment is adverse
to any holder of Rights, and direct the Rights Agent so to supplement or amend
such provision, and the Rights Agent shall so supplement or amend such
provision; provided, however, that from and after the earliest of (i) the date
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of the first Section 11(a)(ii) Event, (ii) the date of the first Section 13(a)
Event, (iii) the Redemption Date or (iv) the Expiration Date, this Agreement
shall not be supplemented or amended in any manner that would materially and
adversely affect any holder of outstanding Rights other than a 15% Stockholder
or a Surviving Person.
12. Anti-Takeover Effects
The Rights are designed to protect and maximize the value of stockholders'
interests in the Company in the event of an unsolicited takeover attempt in a
manner or on terms not approved by the Board of Directors. Takeover attempts
frequently include coercive tactics to deprive the Board of Directors and
stockholders of any real opportunity to determine the destiny of the Company or
to obtain the highest value reasonably obtainable for the capital stock of the
Company. The Rights have been declared by the Board in order to deter such
tactics, including a gradual accumulation in the open market of a 15% or greater
position, followed by a merger or a partial or two-tier tender offer that does
not treat all stockholders equally. These tactics can unfairly pressure
stockholders, squeeze them out of their investment without giving them any real
choice and deprive them of the full value of their shares.
The Rights may be redeemed by the Company as described in Section 8, and
accordingly, the Rights should not interfere with any merger or business
combination approved by the Board of Directors.
Issuance of the Rights does not weaken the Company or interfere with its
business plans. The issuance of the Rights themselves has no dilutive effect,
will not affect reported earnings per
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share and should not be taxable to the Company or to its stockholders. The
Company's Board of Directors believes that the Rights represent a sound and
reasonable means of addressing the complex issues of corporate policy created by
the current takeover environment.
However, the Rights may have the effect of rendering more difficult or
discouraging an acquisition of the Company deemed undesirable by the Board of
Directors. The Rights may cause substantial dilution to a Person or group that
attempts to acquire the Company on terms or in a manner not approved by the
Company's Board of Directors, except pursuant to an offer conditioned upon the
negation, purchase or redemption of the Rights.
Item 2. Exhibits.
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99.1 Rights Agreement dated as of April 6, 1999 between HomeBase,
Inc. and First Chicago Trust Company of New York, as Rights
Agent, which includes thereto the Form of Rights Certificate
to be distributed to holders of Rights after the Distribution
Date (as that term is defined in the Rights Agreement),
incorporated by reference to Form 8-A filed by the Company on
April 7, 1999.
99.2 Certificate of Amendment to the Certificate of Designation,
Preferences and Rights of Series A Junior Participating
Preferred Stock of HomeBase, Inc., effective on April 6, 1999.
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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.
HOMEBASE, INC.
Date: April 13, 1999 By: /s/ John L. Price
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John L. Price
Vice President, General Counsel and Secretary
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EXHIBIT 99.2
CERTIFICATE OF AMENDMENT TO THE CERTIFICATE OF DESIGNATION,
PREFERENCES AND RIGHTS
OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
HOMEBASE, INC.
The undersigned, Allan P. Sherman, the President and Chief Executive
Officer of HOMEBASE, INC., a Delaware corporation (the "Corporation"), does
hereby certify that:
No shares of Series A Junior Participating Preferred Stock described in the
Certificate of Designation filed with the Secretary of State of Delaware on June
2, 1989, have been issued.
Pursuant to the authority conferred upon the Board of Directors by the
Certificate of Incorporation of the Corporation, and Section 151(g) of the
Delaware General Corporation Law, on April 5, 1999, the Board of Directors
adopted the following resolution to amend, effective as of 5:00 p.m., Eastern
Daylight Time, on April 6, 1999, the Certificate of Designation of the Series A
Junior Participating Preferred Stock filed with the Secretary of State of
Delaware on June 2, 1989 so that such Certificate of Designation shall, upon
effectiveness of this Certificate of Amendment of such Certificate of
Designation, read in its entirety as follows:
"RESOLVED, that pursuant to the authority vested in the Board of
Directors of the Corporation by the Certificate of Incorporation, the Board
of Directors does hereby provide for the amendment, effective as of 5:00
p.m., Eastern Daylight Time, on April 6, 1999, of the Certificate of
Designation of the Series A Junior Participating Preferred Stock filed with
the Secretary of State of Delaware on June 2, 1989. Such shares of
preferred stock shall continue to be designated "Series A Junior
Participating Preferred Stock" (hereinafter referred to as the "Series A
Junior Participating Preferred Stock"), consisting of 1,900,000 shares, and
to the extent that the designations, powers, preferences and relative and
other special rights and qualifications, limitations and restrictions of
the Series A Junior Participating Preferred Stock are not stated and
expressed in the Certificate of Incorporation, the Board of Directors of
the Corporation does hereby fix and herein state and express such
designations, powers, preferences, and relative and other special rights
and qualifications, limitations and restrictions thereof as follows:
1. Designation and Amount. The shares of such series shall be
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designated as "Series A Junior Participating Preferred Stock" and the
number of shares constituting such series shall be 1,900,000. Such number
of shares may be increased or decreased by resolution of the Board of
Directors; provided, that no decrease shall reduce the number of shares of
Series A Junior Participating
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Preferred Stock to a number less than the number of shares then outstanding
plus the number of shares reserved for issuance upon the exercise of
outstanding options, rights or warrants or upon the conversion of any
outstanding securities issued by the Corporation convertible into Series A
Junior Participating Preferred Stock.
2. Dividends and Distributions.
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(a) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Stock ranking prior and superior to the
shares of Series A Junior Participating Preferred Stock with respect to
dividends, the holders of shares of Series A Junior Participating Preferred
Stock shall be entitled to receive, when, as and if declared by the Board
of Directors out of funds legally available for the purpose, quarterly
dividends payable in cash on the 1st day of March, June, September, and
December of each year (each a "Quarterly Dividend Payment Date"),
commencing on the first Quarterly Dividend Payment Date after the first
issuance of a share or fraction of a share of Series A Junior Participating
Preferred Stock, in an amount per share (rounded to the nearest cent) equal
to the greater of (a) $1.00 or (b) subject to the provision for adjustment
hereinafter set forth, 1,000 times the aggregate per share amount of all
cash dividends, and 1,000 times the aggregate per share amount (payable in
kind) of all non-cash dividends or other distributions other than a
dividend payable in shares of Common Stock or a subdivision of the
outstanding shares of Common Stock (by reclassification or otherwise),
declared on the Common Stock, par value $0.01 per share, of the Corporation
(the "Common Stock") since the immediately preceding Quarterly Dividend
Payment Date, or, with respect to the first Quarterly Dividend Payment
Date, since the first issuance of any share or fraction of a share of
Series A Junior Participating Preferred Stock. In the event the
Corporation shall at any time after April 5, 1999 (the "Rights Declaration
Date") (i) declare any dividend on Common Stock payable in shares of Common
Stock, (ii) subdivide the outstanding Common Stock or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in each such
case the amount to which holders of shares of Series A Junior Participating
Preferred Stock were entitled immediately prior to such event under clause
(b) of the preceding sentence shall be adjusted by multiplying such amount
by a fraction, the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of which
is the number of shares of Common Stock that were outstanding immediately
prior to such event.
(b) The Corporation shall declare a dividend or distribution on the
Series A Junior Participating Preferred Stock as provided in paragraph (a)
above as a condition to declaration of a dividend or distribution on the
Common Stock (other than a dividend payable in shares of Common Stock);
provided that, in the event that no dividend or distribution shall have
been declared on the Common Stock during the period between any Quarterly
Dividend Payment Date, a
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dividend of $1.00 per share on the Series A Junior Participating Preferred
Stock shall nevertheless be payable on such subsequent Quarterly Dividend
Payment Date.
(c) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Junior Participating Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such shares of
Series A Junior Participating Preferred Stock, unless the date of issue of
such shares is prior to the record date for the first Quarterly Dividend
Payment Date, in which case dividends on such shares shall begin to accrue
from the date of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record date for the
determination of holders of shares of Series A Junior Participating
Preferred Stock entitled to receive a quarterly dividend and before such
Quarterly Dividend Payment Date, in either of which events such dividends
shall begin to accrue and be cumulative from such Quarterly Dividend
Payment Date. Accrued but unpaid dividends shall not bear interest.
Dividends paid on the shares of Series A Junior Participating Preferred
Stock in an amount less than the total amount of such dividends at the time
accrued and payable on such shares shall be allocated pro rata on a share-
by-share basis among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders of shares
of Series A Junior Participating Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which record date
shall be no more than 30 days prior to the date fixed for the payment
thereof.
3. Voting Rights. The holders of shares of Series A Junior
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Participating Preferred Stock shall have the following voting rights:
(a) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Junior Participating Preferred Stock shall entitle
the holder thereof to 1,000 votes on all matters submitted to a vote of the
stockholders of the Corporation. In the event the Corporation shall at any
time after the Rights Declaration Date (i) declare any dividend on Common
Stock payable in shares of Common Stock, (ii) subdivide the outstanding
Common Stock, or (iii) combine the outstanding Common Stock into a smaller
number of shares, then in each case the number of votes per share to which
holders of shares of Series A Junior Participating Preferred Stock were
entitled immediately prior to such event shall be adjusted by multiplying
such number by a fraction, the numerator of which is the number of shares
of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(b) Except as otherwise provided herein or by law, holders of Series A
Junior Participating Preferred Stock shall have no special voting rights
and the holders of shares of Series A Junior Participating Preferred Stock
and the holders
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of shares of Common Stock shall vote together as one class on all matters
submitted to a vote of stockholders of the Corporation.
4. Certain Restrictions.
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(a) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Junior Participating Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid
---------
dividends and distributions, whether or not declared, on shares of Series A
Junior Participating Preferred Stock outstanding shall have been paid in
full, the Corporation shall not:
(i) declare or pay dividends on, make any other distribution on,
or redeem or purchase or otherwise acquire for consideration any shares of
stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Junior Participating Preferred
Stock;
(ii) declare or pay dividends on or make any other distributions
on any shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Junior
Participating Preferred Stock, except dividends paid ratably on the Series
A Junior Participating Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the total amounts to
which the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration
any shares of any stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Junior
Participating Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such junior stock
in exchange for shares of any stock of the Corporation ranking junior
(either as to dividends or upon dissolution, liquidation or winding up) to
the Series A Junior Participating Preferred Stock;
(iv) redeem or purchase or otherwise acquire for consideration
any shares of Series A Junior Participating Preferred Stock, or any shares
of stock ranking on a parity with the Series A Junior Participating
Preferred Stock, except (i) in exchange for shares of any stock of the
Corporation ranking junior (either as to dividends or upon dissolution,
liquidation or winding up) to the Series A Junior Participating Preferred
Stock, or (ii) in accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all holders of
such shares upon such terms as the Board of Directors, after consideration
of the respective annual dividend rates and other relative rights and
preferences of the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the respective
series or classes.
(b) The Corporation shall not permit any subsidiary of the Corporation
to purchase or otherwise acquire for consideration any shares of stock of
the
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Corporation unless the Corporation could, under paragraph (a) of this
Section 4, purchase or otherwise acquire such shares at such time and in
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such manner.
5. Reacquired Shares. Any shares of Series A Junior Participating
-----------------
Preferred Stock purchased or otherwise acquired by the Corporation in any
manner whatsoever shall be retired and canceled promptly after the
acquisition thereof. All such shares shall upon their cancellation become
authorized but unissued shares of Preferred Stock and may be reissued as
Series A Junior Participating Preferred Stock or as part of a new series of
Preferred Stock to be created by resolution or resolutions of the Board of
Directors, subject to the conditions and restrictions on issuance set forth
herein.
6. Liquidation, Dissolution or Winding Up.
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(a) Upon any liquidation (voluntary or otherwise), dissolution or
winding up of the Corporation, no distribution shall be made to the holders
of shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Junior
Participating Preferred Stock unless, prior thereto, the holders of shares
of Series A Junior Participating Preferred Stock shall have received $1,000
per share, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such payment
(the "Series A Liquidation Preference"). Following the payment of the full
amount of the Series A Liquidation Preference, no additional distributions
shall be made to the holders of shares of Series A Junior Participating
Preferred Stock unless, prior thereto, the holders of shares of Common
Stock shall have received an amount per share (the "Common Adjustment")
equal to the quotient obtained by dividing (i) the Series A Liquidation
Preference by (ii) 1,000 (as appropriately adjusted as set forth in
subparagraph (c) below to reflect such events as stock splits, stock
dividends and recapitalizations with respect to the Common Stock) (such
number in clause (ii), the "Adjustment Number"). Following the payment of
the full amount of the Series A Liquidation Preference and the Common
Adjustment in respect of all outstanding shares of Series A Junior
Participating Preferred Stock and Common Stock, respectively, holders of
Series A Junior Participating Preferred Stock and holders of shares of
Common Stock shall receive their ratable and proportionate share of
remaining assets to be distributed in the ratio of the Adjustment Number to
one (1) with respect to such Preferred Stock and Common Stock, on a per
share basis, respectively.
(b) In the event, however, that there are not sufficient assets
available to permit payment in full of the Series A Liquidation Preference
and the liquidation preferences of all other series of Preferred Stock, if
any, which rank on a parity with the Series A Junior Participating
Preferred Stock, then such remaining assets shall be distributed ratably to
the holders of such parity shares in proportion to their respective
liquidation preferences. In the event that there are
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not sufficient assets available to permit payment in full of the Common
Adjustment, then such remaining assets shall be distributed ratably to the
holders of Common Stock.
(c) In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock payable in shares
of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then
in each such case the Adjustment Number in effect immediately prior to such
event shall be adjusted by multiplying such Adjustment Number by a
fraction, the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately
prior to such event.
7. Consolidation, Merger, etc. In case the Corporation shall enter
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into any consolidation, merger, combination or other transaction in which
the shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the
shares of Series A Junior Participating Preferred Stock shall at the same
time be similarly exchanged or changed in an amount per share (subject to
the provision for adjustment hereinafter set forth) equal to 1,000 times
the aggregate amount of stock, securities, cash and/or any other property
(payable in kind), as the case may be, into which or for which each share
of Common Stock is changed or exchanged. In the event the Corporation
shall at any time after the Rights Declaration Date (i) declare any
dividend on Common Stock payable in shares of Common Stock, (ii) subdivide
the outstanding Common Stock, or (iii) combine the outstanding Common Stock
into a smaller number of shares, then in each such case the amount set
forth in the preceding sentence with respect to the exchange or change of
shares of Series A Junior Participating Preferred Stock shall be adjusted
by multiplying such amount by a fraction, the numerator of which is the
number of shares of Common Stock outstanding immediately after such event
and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
8. No Redemption. The shares of Series A Junior Participating
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Preferred Stock shall not be redeemable.
9. Ranking. The Series A Junior Participating Preferred Stock shall
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rank junior to all other series of the Corporation's preferred stock, if
any, as to the payment of dividends and the distribution of assets, unless
the terms of any such series shall provide otherwise.
10. Amendment. If there is any Series A Junior Participating
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Preferred Stock outstanding, the Certificate of Incorporation of the
Corporation shall not be further amended in any manner which would
materially alter or change the powers, preferences or special rights of the
Series A Junior Participating Preferred Stock so as to affect them
adversely without the
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affirmative vote of the holders of a majority or more of the outstanding
shares of Series A Junior Participating Preferred Stock, voting separately
as a class.
11. Fractional Shares. Series A Junior Participating Preferred Stock
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may be issued in fractions of a share, which shall entitle the holder, in
proportion to such holder's fractional shares, to exercise voting rights,
receive dividends, participate in distributions and to have the benefit of
all other rights of holders of Series A Junior Participating Preferred
Stock.
RESOLVED FURTHER, that the Chief Executive Officer, the President or
any Executive Vice President or Vice President and the Secretary or any
Assistant Secretary of the Corporation be, and they hereby are, authorized
and directed to prepare and file a Certificate of Amendment to the
Certificate of Designation, Preferences and Rights of the Series A Junior
Participating Preferred Stock in accordance with the foregoing resolution
and the provisions of Delaware law and to take such actions as they may
deem necessary or appropriate to carry out the intent of the foregoing
resolution."
IN WITNESS WHEREOF, this Certificate of Amendment of Certificate of
Designation is executed on April 5, 1999.
HOMEBASE, INC.,
a Delaware corporation
By: /s/ Allan P. Sherman
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Allan P. Sherman
President and Chief Executive Officer
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