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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
WILLBROS GROUP, INC.
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(Exact name of registrant as specified in its charter)
Republic of Panama 98-0160660
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(State of incorporation or organization) (I.R.S. Employer Identification No.)
Dresdner Bank Building
50th Street, 8th Floor
P. O. Box 850048
Panama 5, Republic of Panama
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(Address of principal executive offices)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
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Preferred Share Purchase Rights New York Stock Exchange
If this Form relates to the registration of a class of securities
pursuant to Section 12(b) of the Exchange Act and is effective
pursuant to General Instruction A.(c), check the following box. X
---
If this Form relates to the registration of a class of securities
pursuant to Section 12(g) of the Exchange Act and is effective
pursuant to General Instruction A.(d), check the following box. ---
Securities Act registration statement file number to which this
form relates:
----------------------- (if applicable)
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.
On April 1, 1999, the Board of Directors of Willbros Group,
Inc. (the "Corporation") declared a distribution of one preferred
share purchase right (a "Right") for each outstanding share of
Common Stock, par value $.05 per share (the "Common Shares"), of
the Corporation. The distribution is payable to the stockholders
of record of the Corporation on April 15, 1999 (the "Record
Date"), and with respect to Common Shares issued thereafter until
the Distribution Date (as defined below) and, in certain
circumstances, with respect to Common Shares issued after the
Distribution Date. Except as set forth below, each Right, when
it becomes exercisable, entitles the registered holder to
purchase from the Corporation one one-thousandth of a share of
Series A Junior Participating Preferred Stock, with a par value
of $.01 per share, of the Corporation (the "Preferred Shares") at
a price of $30.00 per one one-thousandth of a Preferred Share
(the "Purchase Price"), subject to adjustment. The description
and terms of the Rights are set forth in a Rights Agreement, as
the same may be amended from time to time (the "Rights
Agreement"), between the Corporation and ChaseMellon Shareholder
Services, L.L.C., as Rights Agent, dated as of April 1, 1999.
Initially, the Rights will be attached to all certificates
representing Common Shares then outstanding, and no separate
Right Certificates will be distributed. The Rights will separate
from the Common Shares upon the earlier to occur of (i) the first
date of public announcement of a person or group of affiliated or
associated persons having acquired beneficial ownership of 15
percent or more of the outstanding Common Shares (except pursuant
to a Permitted Offer, as hereinafter defined); or (ii) 10 days
(or such later date as the Board of Directors of the Corporation
(the "Board") may determine) following the commencement of, or
announcement of an intention to make, a tender offer or exchange
offer the consummation of which would result in a person or group
becoming an Acquiring Person (as hereinafter defined) (the
earlier of such dates being called the "Distribution Date"). A
person or group whose acquisition of Common Shares causes a
Distribution Date pursuant to clause (i) above is an "Acquiring
Person." The first date of public announcement that a person or
group has become an Acquiring Person is the "Shares Acquisition
Date."
The Rights Agreement provides that, until the Distribution
Date, the Rights will be transferred with and only with the
Common Shares. Until the Distribution Date (or earlier
redemption or expiration of the Rights) new Common Share
certificates issued after the Record Date upon transfer or new
issuance of Common Shares will contain a notation incorporating
the Rights Agreement by reference. Until the Distribution Date
(or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for Common Shares
outstanding as of the Record Date, even without such notation or
a copy of this Summary of Rights being attached thereto, will
also constitute the transfer of the Rights associated with the
Common Shares represented by such certificate. As soon as
practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be
mailed to holders of record of the Common Shares as of the close
of business on the Distribution Date (and to each initial record
holder of certain Common Shares issued after the Distribution
Date), and such separate Right Certificates alone will evidence
the Rights.
The Rights are not exercisable until the Distribution Date
and will expire at the close of business on April 15, 2009,
unless earlier redeemed or exchanged by the Corporation as
described below.
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In the event that any person or group becomes an Acquiring
Person (except pursuant to a tender or exchange offer which is
for all outstanding Common Shares at a price and on terms which a
majority of certain members of the Board determines to be
adequate and in the best interests of the Corporation, its
stockholders and other relevant constituencies, other than such
Acquiring Person, its affiliates and associates (a "Permitted
Offer")), each holder of a Right will thereafter have the right
(the "Flip-In Right") to receive upon exercise the number of
Common Shares or of one onethousandths of a share of Preferred
Shares (or, in certain circumstances, other securities of the
Corporation) having a value (immediately prior to such triggering
event) equal to two times the exercise price of the Right.
Notwithstanding the foregoing, following the occurrence of the
event described above, all Rights that are, or (under certain
circumstances specified in the Rights Agreement) were,
beneficially owned by any Acquiring Person or any affiliate or
associate thereof will be null and void.
In the event that, at any time following the Shares
Acquisition Date, (i) the Corporation is acquired in a merger or
other business combination transaction in which the holders of
all of the outstanding Common Shares immediately prior to the
consummation of the transaction are not the holders of all of the
surviving corporation's voting power, or (ii) more than 50
percent of the Corporation's assets or earning power is sold or
transferred, then each holder of a Right (except Rights which
previously have been voided as set forth above) shall thereafter
have the right (the "Flip-Over Right") to receive, upon exercise,
common shares of the acquiring company having a value equal to
two times the exercise price of the Right. The holder of a Right
will continue to have the Flip-Over Right whether or not such
holder exercises or surrenders the Flip-In Right.
The Purchase Price payable, and the number of Preferred
Shares, Common Shares or other securities issuable, upon exercise
of the Rights are subject to adjustment from time to time to
prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred
Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights or warrants to subscribe for or purchase Preferred
Shares at a price, or securities convertible into Preferred
Shares with a conversion price, less than the then current market
price of the Preferred Shares, or (iii) upon the distribution to
holders of the Preferred Shares of evidences of indebtedness or
assets (excluding regular quarterly cash dividends) or of
subscription rights or warrants (other than those referred to
above).
The Purchase Price and number of outstanding Rights are also
subject to adjustment in the event of a stock split of the Common
Shares or a stock dividend on the Common Shares payable in Common
Shares or subdivisions, consolidations or combinations of the
Common Shares occurring, in any such case, prior to the
Distribution Date.
Preferred Shares purchasable upon exercise of the Rights
will not be redeemable. Each Preferred Share will be entitled to
a minimum preferential quarterly dividend payment of $10.00 per
share but, if greater, will be entitled to an aggregate dividend
per share of 1,000 times the dividend declared per Common Share.
In the event of liquidation, the holders of the Preferred Shares
will be entitled to a minimum preferential liquidation payment of
$1,000 per share; thereafter, and after the holders of the Common
Shares receive a liquidation payment of $1.00 per share, the
holders of the Preferred Shares and the holders of the Common
Shares will share the remaining assets in the ratio of 1,000 to 1
(as adjusted) for each Preferred Share and Common Share so held,
respectively. Each Preferred Share will have 1,000 votes, voting
together with the Common Shares. Finally, in the event of any
merger, consolidation or other transaction in which Common Shares
are exchanged,
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each Preferred Share will be entitled to receive 1,000 times the
amount received per Common Share. These rights are protected by
customary antidilution provisions. In the event that the amount
of accrued and unpaid dividends on the Preferred Shares is
equivalent to six full quarterly dividends or more, the holders
of the Preferred Shares shall have the right, voting as a class,
to elect two directors in addition to the directors elected by
the holders of the Common Shares until all cumulative dividends
on the Preferred Shares have been paid through the last quarterly
dividend payment date or until non-cumulative dividends have been
paid regularly for at least one year.
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an
adjustment of at least 1percent in such Purchase Price. No
fractional Preferred Shares will be issued (other than fractions
which are one one-thousandth or integral multiples of one one-
thousandth of a Preferred Share, which may, at the election of
the Board, be evidenced by depositary receipts) and in lieu
thereof, an adjustment in cash will be made based on the market
price of the Preferred Shares on the last trading day prior to
the date of exercise.
At any time prior to the earlier to occur of (i) a person
becoming an Acquiring Person or (ii) the expiration of the
Rights, and under certain other circumstances, the Corporation
may redeem the Rights in whole, but not in part, at a price of
$.005 per Right (the "Redemption Price") which redemption shall
be effective upon the action of the Board. Additionally,
following the Shares Acquisition Date, the Corporation may redeem
the then outstanding Rights in whole, but not in part, at the
Redemption Price, provided that such redemption is in connection
with a merger or other business combination transaction or series
of transactions involving the Corporation in which all holders of
Common Shares are treated alike but not involving an Acquiring
Person or its affiliates or associates.
At any time after any person or group becomes an Acquiring
Person and prior to the acquisition by such person or group of 50
percent or more of the outstanding Common Shares, the Board may
exchange the Rights (other than Rights owned by the Acquiring
Person, which will have become void), in whole or in part, at an
exchange ratio of one Common Share, or one one-thousandth of a
Preferred Share (or of a share of a class or series of the
Corporation's preferred stock having equivalent rights,
preferences and privileges), per Right (subject to adjustment).
All of the provisions of the Rights Agreement may be amended
by the Board prior to the Distribution Date. After the
Distribution Date, the provisions of the Rights Agreement may be
amended by the Board only in order to cure any ambiguity, defect
or inconsistency, to make changes which do not adversely affect
the interests of holders of Rights (excluding the interests of
any Acquiring Person), or, subject to certain limitations, to
shorten or lengthen any time period under the Rights Agreement.
Until a Right is exercised or exchanged, the holder thereof,
as such, will have no right to vote or receive dividends or other
distributions and will have no other rights as a stockholder of
the Corporation. While the distribution of the Rights will not
be taxable to stockholders of the Corporation, stockholders may,
depending upon the circumstances, recognize taxable income should
the Rights become exercisable or upon the occurrence of certain
events thereafter.
The Rights Agreement between the Corporation and the Rights
Agent specifying the terms of the Rights, which includes as
Exhibit A the form of Certificate of Designation of Series A
Junior Participating Preferred Stock of the Corporation, as
Exhibit B the form of Right Certificate and as
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Exhibit C the Summary of Rights to Purchase Preferred Shares, is
attached hereto as an exhibit and incorporated herein by
reference. The foregoing description of the Rights is qualified
by reference to such exhibit.
Item 2. Exhibits.
4.1 Rights Agreement, dated as of April 1, 1999, between
Willbros Group, Inc. and ChaseMellon Shareholder
Services, L.L.C., as Rights Agent, together with the
following exhibits thereto: Exhibit A- Form of
Certificate of Designation of Series A Junior
Participating Preferred Stock of Willbros Group, Inc.;
Exhibit B-Form of Right Certificate; Exhibit C-Summary
of Rights to Purchase Preferred Shares of Willbros
Group, Inc.
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.
Date: April 9, 1999
WILLBROS GROUP, INC.
By: /s/ Melvin F. Spreitzer
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Melvin F. Spreitzer
Executive Vice President,
Chief Financial Officer and Treasurer
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EXHIBIT INDEX
Exhibit Number Description
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4.1 Rights Agreement, dated as of April 1, 1999,
between Willbros Group, Inc. and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent,
together with the following exhibits thereto:
Exhibit A-Form of Certificate of Designation of
Series A Junior Participating Preferred Stock of
Willbros Group, Inc.; Exhibit B-Form of Right
Certificate; Exhibit C-Summary of Rights to
Purchase Preferred Shares of Willbros Group, Inc.
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EXHIBIT 4.1
RIGHTS AGREEMENT
by and between
WILLBROS GROUP, INC.
and
CHASEMELLON SHAREHOLDER
SERVICES, L.L.C.,
as Rights Agent
Dated as of April 1, 1999
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TABLE OF CONTENTS
Page
Section 1. Certain Definitions 1
Section 2. Appointment of Rights Agent 5
Section 3. Issuance of Right Certificates 5
Section 4. Form of Right Certificates 7
Section 5. Countersignature and Registration 8
Section 6. Transfer, Split-Up, Combination and
Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen
Right Certificates 9
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights 10
Section 8. Cancellation and Destruction of
Right Certificates 12
Section 9. Reservation and Availability of
Capital Stock 12
Section 10. Preferred Shares Record Date 14
Section 11. Adjustment of Purchase Price, Number
and Kind of Shares or Number of Rights 14
Section 12. Certificate of Adjusted Purchase Price
or Number of Shares 22
Section 13. Consolidation, Merger or Sale or
Transfer of Assets or Earning Power 22
Section 14. Fractional Rights and Fractional Shares 25
Section 15. Rights of Action 26
Section 16. Agreement of Right Holders 26
Section 17. Right Certificate Holder Not Deemed
a Stockholder 27
Section 18. Concerning the Rights Agent 28
Section 19. Merger or Consolidation or Change of
Name of Rights Agent 28
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Section 20. Duties of Rights Agent 29
Section 21. Change of Rights Agent 31
Section 22. Issuance of New Right Certificates 32
Section 23. Redemption and Termination 32
Section 24. Exchange 34
Section 25. Notice of Certain Events 35
Section 26. Notices 36
Section 27. Supplements and Amendments 37
Section 28. Determination and Actions by the
Board, etc. 37
Section 29. Successors 38
Section 30. Benefits of this Agreement 38
Section 31. Severability 38
Section 32. Governing Law 38
Section 33. Counterparts 38
Section 34. Descriptive Headings 38
Signatures 39
Exhibit A Form of Certificate of Designation
of Preferred Stock A-1
Exhibit B Form of Right Certificate B-1
Exhibit C Summary of Rights to Purchase
Preferred Shares C-1
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RIGHTS AGREEMENT
THIS RIGHTS AGREEMENT (this "Agreement") is made and entered
into as of April 1, 1999, by and between Willbros Group, Inc., a
Republic of Panama corporation (the "Corporation"), and
ChaseMellon Shareholder Services, L.L.C., a New Jersey limited
liability company (the "Rights Agent").
The Board of Directors of the Corporation has authorized and
declared a distribution of one preferred share purchase right (a
"Right") for each Common Share (as hereinafter defined) of the
Corporation outstanding at the Close of Business (as hereinafter
defined) on April 15, 1999 (the "Record Date"), each Right
representing the right to purchase one one-thousandth of a
Preferred Share (as hereinafter defined), upon the terms and
subject to the conditions herein set forth, and has further
authorized and directed the issuance of one Right with respect to
each Common Share that shall become outstanding between the
Record Date and the earliest of the Distribution Date, the
Redemption Date and the Final Expiration Date (as such terms are
hereinafter defined); provided, however, that Rights may be
issued with respect to Common Shares that shall become
outstanding after the Distribution Date and prior to the earlier
of the Redemption Date and the Final Expiration Date in
accordance with the provisions of this Agreement.
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 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 15 percent or more
of the then outstanding Common Shares (other than as a
result of a Permitted Offer) or was such a Beneficial Owner
at any time after the date hereof, whether or not such
Person continues to be the Beneficial Owner of 15 percent or
more of the then outstanding Common Shares. Notwithstanding
the foregoing, (i) the term "Acquiring Person" shall not
include (A) the Corporation, (B) any Subsidiary of the
Corporation, (C) any employee benefit plan of the
Corporation or of any Subsidiary of the Corporation, or
(D) any Person or entity organized, appointed or established
by the Corporation for or pursuant to the terms of any such
plan; and (ii) no Person shall be deemed to be an "Acquiring
Person" either (A) as a result of the acquisition of Common
Shares by the Corporation which, by reducing the number of
Common Shares outstanding, increases the proportional number
of shares beneficially owned by such Person together with
all Affiliates and Associates of such Person (except that if
(1) a Person would become an Acquiring Person (but for the
operation of this subclause A) as a result of the
acquisition of Common Shares by the Corporation, and
(2) after such share acquisition by the Corporation, such
Person, or an Affiliate or Associate of such Person, becomes
the Beneficial Owner of any additional Common Shares (other
than pursuant to a dividend or other distribution paid or
made by the Corporation on the
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outstanding Common Shares or pursuant to a split or
subdivision of the outstanding Common Shares), then such
Person shall be deemed an Acquiring Person), or (B) if
(1) within eight days after such Person would otherwise have
become an Acquiring Person (but for the operation of this
subclause B), such Person notifies the Board that such
Person did so inadvertently and (2) within two days after
such notification, such Person is the Beneficial Owner of
less than 15percent of the outstanding Common Shares.
(b) "Act" shall mean the U.S. Securities Act of 1933,
as amended and as in effect on the date of this Agreement.
(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 "beneficially own," any
securities:
(i) which such Person or any of such Person's
Affiliates or Associates, directly or indirectly,
beneficially owns (as determined pursuant to Rule 13d-3
of the General Rules and Regulations under the Exchange
Act, as in effect on the date of this Agreement);
(ii) which such Person or any of such Person's
Affiliates or Associates, directly or indirectly, has
(A) the right to acquire (whether such right is
exercisable immediately or only upon the occurrence of
certain events or after the passage of time or both)
pursuant to any agreement, arrangement or understanding
(whether or not in writing), or upon the exercise of
conversion rights, exchange rights, rights (other than
the Rights), warrants or options, or otherwise;
provided, however, that a Person shall not be deemed
the Beneficial Owner of, or to beneficially own,
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; or (B) the right to vote (whether such right
is exercisable immediately or only upon the occurrence
of certain events or after the passage of time or both)
pursuant to any agreement, arrangement or understanding
(whether or not in writing) or otherwise; provided,
however, that a Person shall not be deemed the
Beneficial Owner of, or to beneficially own, any
security under this clause B as a result of an
agreement, arrangement or understanding to vote such
security, if such agreement, arrangement or
understanding (1) 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); or
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(iii) which are beneficially owned, directly
or indirectly, by any other Person (or any Affiliate or
Associate thereof) with which such Person (or any of
such Person's Affiliates or Associates) has any
agreement, arrangement or understanding, whether or not
in writing (other than customary agreements with and
between underwriters and selling group members with
respect to a bona fide public offering of securities),
relating to the acquisition, holding, voting (except to
the extent contemplated by the proviso to
Section 1(d)(ii)(B) hereof) or disposing of any
securities of the Corporation.
Notwithstanding anything in this definition of Beneficial
Ownership to the contrary, the phrase "then outstanding,"
when used with reference to a Person's Beneficial Ownership
of securities of the Corporation, 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) "Board" shall mean the Board of Directors of the
Corporation.
(f) "Business Day" shall mean any day other than a
Saturday, Sunday, U.S. federal holiday, or a day on which
banking institutions in the State of Texas, U.S.A., are
authorized or obligated by law or executive order to close.
(g) "Close of Business" on any given date shall mean
5:00 P.M., Dallas, Texas, time, on such date; provided,
however, that if such date is not a Business Day "Close of
Business" shall mean 5:00 P.M., Dallas, Texas, time, on the
next succeeding Business Day.
(h) "Common Shares" shall mean the shares of Common
Stock, par value $.05 per share, of the Corporation or, in
the event of a subdivision, combination or consolidation
with respect to such shares of Common Stock, the shares of
Common Stock resulting from such subdivision, combination or
consolidation, except that, when used with reference to any
Person other than the Corporation, "Common Shares" shall
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.
(i) "Distribution Date" shall have the meaning set
forth in Section 3(a) hereof.
(j) "Exchange Act" shall mean the U.S. Securities
Exchange Act of 1934, as amended and as in effect on the
date of this Agreement.
(k) "Final Expiration Date" shall have the meaning set
forth in Section 7(a) hereof.
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(l) "Interested Stockholder" shall mean any Acquiring
Person or any Affiliate or Associate of an Acquiring Person
or any other Person in which any such Acquiring Person,
Affiliate or Associate has an interest which represents in
excess of 5 percent of the total combined economic or voting
power of such other Person, or any other Person acting
directly or indirectly on behalf of or in concert with any
such Acquiring Person, Affiliate or Associate.
(m) "Permitted Offer" shall mean a tender or exchange
offer which is for all outstanding Common Shares at a price
and on terms determined, prior to the purchase of shares
under such tender or exchange offer, by at least a majority
of the members of the Board who are not Acquiring Persons or
Affiliates, Associates, nominees or representatives of an
Acquiring Person, to be adequate (taking into account all
factors that such Directors deem relevant, including without
limitation prices that could reasonably be achieved if the
Corporation or its assets were sold on an orderly basis
designed to realize maximum value) and otherwise in the best
interests of the Corporation and its stockholders (other
than the Person or any Affiliate or Associate thereof on
whose basis the offer is being made) taking into account all
factors that such Directors may deem relevant.
(n) "Person" shall mean any individual, firm,
partnership, corporation, limited liability company, trust,
association, joint venture or other entity, and shall
include any successor (by merger or otherwise) of such
entity.
(o) "Preferred Shares" shall mean shares of Series A
Junior Participating Preferred Stock, with a par value of
$.01 per share, a series of the Class A Preferred Stock of
the Corporation, having the relative rights, preferences and
limitations set forth in the Form of Certificate of
Designation attached to this Agreement as Exhibit A.
(p) "Purchase Price" shall have the meaning set forth
in Section 4(a) hereof.
(q) "Redemption Date" shall have the meaning set forth
in Section 7(a) hereof.
(r) "Right Certificate" shall have the meaning set
forth in Section 3(a) hereof.
(s) "Section 11(a)(ii) Event" shall mean any event
described in Section 11(a)(ii) hereof.
(t) "Section 13 Event" shall mean any event described
in clause (x), (y) or (z) of Section 13(a) hereof.
(u) "Shares 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 the Exchange Act) by the Corporation or an
Acquiring Person that an Acquiring Person has become such;
provided, that, if such Person is determined not to have
become an
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Acquiring Person pursuant to Section 1(a)(ii) hereof, then
no Shares Acquisition Date shall be deemed to have occurred.
(v) "Subsidiary" of any Person shall mean any
corporation or other Person of which a majority of the
voting power of the voting equity securities or equity
interest is owned, directly or indirectly, by such Person.
(w) "Trading Day" shall have the meaning set forth in
Section 11(d)(i) hereof.
(x) "Triggering Event" shall mean any
Section 11(a)(ii) Event or any Section 13 Event.
Section 2. Appointment of Rights Agent. The Corporation
hereby appoints the Rights Agent to act as agent for the
Corporation in accordance with the terms and conditions hereof.
The Rights Agent hereby accepts such appointment. The
Corporation may from time to time appoint such co-Rights Agents
as it may deem necessary or desirable, in which case the
respective duties of the Rights Agent and any co-Rights Agent
shall be as the Corporation shall determine; provided, however,
no such appointment or allocation of duties shall change or
increase the Rights Agent's duties, liabilities or obligations.
The Rights Agent shall have no duty to supervise, and in no event
shall be liable for, the acts or omissions of any such co-Rights
Agent.
Section 3. Issuance of Right Certificates.
(a) Until the earlier of (i) the Shares Acquisition
Date or (ii) the Close of Business on the tenth day (or such
later date as may be determined by action of the Board)
after the date of the commencement by any Person (other than
the Corporation, any Subsidiary of the Corporation, any
employee benefit plan of the Corporation or of any
Subsidiary of the Corporation or any Person or entity
organized, appointed or established by the Corporation for
or pursuant to the terms of any such plan) of, or of the
first public announcement of the intention of any Person
(other than the Corporation, any Subsidiary of the
Corporation, any employee benefit plan of the Corporation or
of any Subsidiary of the Corporation or any Person or entity
organized, appointed or established by the Corporation for
or pursuant to the terms of any such plan) to commence
(which intention to commence remains in effect for five
Business Days after such announcement), a tender or exchange
offer the consummation of which would result in any Person
becoming an Acquiring Person (including, in the case of
both clause (i) and (ii), any such date which is after the
date of this Agreement and prior to the issuance of the
Rights), the earlier of such dates being herein referred to
as the "Distribution Date," (1) the Rights will be evidenced
(subject to the provisions of Section 3(b) hereof) by the
certificates for Common Shares registered in the names of
the holders thereof (which certificates shall also be deemed
to be Right Certificates) and not by separate Right
Certificates, and (2) the right to receive Right
Certificates will be transferable only in connection with
the transfer of the underlying Common Shares (including
without limitation a transfer to the Corporation); provided,
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however, that, if a tender offer is terminated prior to the
occurrence of a Distribution Date, then no Distribution Date
shall occur as a result of such tender offer. Upon the
occurrence of a Distribution Date, the Corporation shall
promptly notify the Rights Agent and request a stockholder
list from the Corporation's transfer agent. As soon as
practicable after the Rights Agent receives such notice and
list, the Corporation will prepare and execute, the Rights
Agent will countersign, and the Corporation will send or
cause to be sent by first-class mail, postage-prepaid, to
each record holder of Common Shares as of the Close of
Business on the Distribution Date, at the address of such
holder shown on the records of the Corporation, a Right
Certificate, substantially in the form of Exhibit B hereto
(a "Right Certificate"), evidencing one Right for each
Common Share so held. As of and after the Distribution
Date, the Rights will be evidenced solely by such Right
Certificates.
(b) As promptly as practicable following the Record
Date, the Corporation will send a copy of a Summary of
Rights to Purchase Preferred Shares, in substantially the
form of Exhibit C hereto (the "Summary of Rights"), by
first-class mail, postage-prepaid, to each record holder of
Common Shares as of the Close of Business on the Record
Date, at the address of such holder shown on the records of
the Corporation. With respect to certificates for Common
Shares outstanding as of the Record Date, until the
Distribution Date, the Rights will be evidenced by such
certificates registered in the names of the holders thereof
together with a copy of the Summary of Rights attached
thereto. Until the Distribution Date (or the earlier of the
Redemption Date or the Final Expiration Date), the surrender
for transfer of any certificate for Common Shares
outstanding on the Record Date, with or without a copy of
the Summary of Rights attached thereto, shall also
constitute the transfer of the Rights associated with such
Common Shares.
(c) Rights shall be issued in respect of all Common
Shares outstanding as of the Record Date or issued (on
original issuance or out of treasury) after the Record Date
but prior to the earliest of the Distribution Date, the
Redemption Date and the Final Expiration Date. In addition,
in connection with the issuance or sale of Common Shares
following the Distribution Date and prior to the earlier of
the Redemption Date and the Final Expiration Date, the
Corporation (i) shall, with respect to Common Shares so
issued or sold, pursuant to the exercise of stock options or
under any employee plan or arrangement or upon the exercise,
conversion or exchange of other securities issued by the
Corporation prior to the Distribution Date, and (ii) may, in
any other case, if deemed necessary or appropriate by the
Board, issue Right Certificates representing the appropriate
number of Rights in connection with such issuance or sale;
provided, however, that no such Right Certificate shall be
issued if, and to the extent that (x) the Corporation shall
be advised by counsel that such issuance would create a
significant risk of material adverse tax consequences to the
Corporation or the Person to whom such Right Certificate
would be issued or (y) appropriate adjustment shall
otherwise have been made in lieu of the issuance thereof.
(d) Certificates for Common Shares which become
outstanding (including without limitation reacquired Common
Shares referred to in the last sentence of this
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paragraph (d)) after the Record Date but prior to the
earliest of the Distribution Date, the Redemption Date and
the Final Expiration Date, shall be deemed also to be
certificates for Rights, and shall bear the following
legend:
This certificate also evidences and entitles the
holder hereof to certain Rights as set forth in a
Rights Agreement between Willbros Group, Inc. and
ChaseMellon Shareholder Services, L.L.C., dated as
of April 1, 1999 (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 Willbros Group,
Inc. 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, may be
redeemed or exchanged or may expire. Willbros
Group, Inc. will mail to the holder of this
certificate a copy of the Rights Agreement without
charge after receipt of a written request
therefor. As set forth in the Rights Agreement,
Rights issued to, or held by, any Person who is,
was or becomes an Acquiring Person or an Affiliate
or Associate thereof (as such terms are defined in
the Rights Agreement) and certain related Persons,
whether currently held by or on behalf of such
Person or by any subsequent holder, may become
null and void.
With respect to such certificates containing the foregoing
legend, until the Distribution Date, the Rights associated
with the Common Shares represented by such certificates
shall be evidenced by such certificates alone, and the
surrender for transfer of any such certificate shall also
constitute the transfer of the Rights associated with the
Common Shares represented thereby. In the event that the
Corporation purchases or acquires any Common Shares after
the Record Date but prior to the Distribution Date, any
Rights associated with such Common Shares shall be deemed
cancelled and retired so that the Corporation shall not be
entitled to exercise any Rights associated with such Common
Shares which are no longer outstanding.
Section 4. Form of Right Certificates.
(a) The Right Certificates (and the forms of election
to purchase and of assignment to be printed on the reverse
thereof) shall be substantially in the form set forth in
Exhibit B hereto and may have such marks of identification
or designation and such legends, summaries or endorsements
printed thereon as the Corporation may deem appropriate
(which do not affect the duties or responsibilities of the
Rights Agent) 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 to conform to usage.
Subject to the provisions of Sections 11 and 22 hereof, the
Right Certificates shall entitle the holders thereof to
purchase such number of one one-thousandths
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<PAGE>
of a Preferred Share as shall be set forth therein at the
price per one one-thousandth of a Preferred Share set forth
therein, as specified in Section 7(b) hereof (the "Purchase
Price"), but the amount and type of securities purchasable
upon the exercise of each Right and the Purchase Price
thereof shall be subject to adjustment as provided herein.
(b) Any Right Certificate issued pursuant to
Section 3(a) or Section 22 hereof that represents Rights
which are null and void pursuant to Section 7(e) of this
Agreement and any Right Certificate issued pursuant to
Section 6 or 11 hereof upon transfer, exchange, replacement
or adjustment of any other Right Certificate referred to in
this sentence, shall contain (to the extent feasible) the
following legend:
The Rights represented by this Right Certificate
are or were beneficially owned by a Person who was
or became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person (as such terms
are defined in the Rights Agreement).
Accordingly, this Right Certificate and the Rights
represented hereby are null and void.
Provisions of Section 7(e) of this Agreement shall be
operative whether or not the foregoing legend is contained
on any such Right Certificate.
Section 5. Countersignature and Registration.
(a) The Right Certificates shall be executed on behalf
of the Corporation by its Chairman of the Board, its Chief
Executive Officer, its President, any of its Vice
Presidents, or its Treasurer, either manually or by
facsimile signature, shall have affixed thereto the
Corporation's seal or a facsimile thereof, and shall be
attested by the Secretary or an Assistant Secretary of the
Corporation, either manually or by facsimile signature. The
Right Certificates shall be countersigned by the Rights
Agent and shall not be valid for any purpose unless so
countersigned. In case any officer of the Corporation who
shall have signed any of the Right Certificates shall cease
to be such officer of the Corporation before
countersignature by the Rights Agent and issuance and
delivery by the Corporation, such Right Certificates may
nevertheless be countersigned by the Rights Agent and issued
and delivered by the Corporation with the same force and
effect as though the Person who signed such Right
Certificates had not ceased to be such officer of the
Corporation; and any Right Certificate may be signed on
behalf of the Corporation by any Person who, at the actual
date of the execution of such Right Certificate, shall be a
proper officer of the Corporation 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) Following the Distribution Date and receipt by the
Rights Agent of the notice and list of record holders of
Rights referred to in Section 3(a) hereof, the Rights Agent
will keep or cause to be kept, at its office designated
pursuant to Section 26 hereof as the appropriate place for
surrender of Right Certificates upon exercise, transfer or
exchange,
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books for registration and transfer of the Right
Certificates issued hereunder. Such books shall show the
names and addresses of the respective holders of the Right
Certificates, the number of Rights evidenced on its face by
each of the Right Certificates and the certificate number
and the date of each of the Right Certificates.
Section 6. Transfer, Split-Up, Combination and Exchange
of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates.
(a) Subject to the provisions of Sections 4(b), 7(e)
and 14 hereof, 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 one
one-thousandth of a Preferred Share (or, following a
Triggering Event, other securities, as the case may be) as
the Right Certificate or Right Certificates surrendered then
entitled such holder (or former holder in the case of a
transfer) to purchase. Any registered holder desiring to
transfer, split up, combine or exchange any Right
Certificate or Right Certificates 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 at the office
of the Rights Agent designated for such purpose. Neither
the Rights Agent nor the Corporation 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 Corporation or the Rights Agent shall
reasonably request. Thereupon the Rights Agent shall,
subject to Sections 4(b), 7(e) and 14 hereof, countersign
and deliver to the Person entitled thereto a Right
Certificate or Right Certificates, as the case may be, as so
requested. The Corporation 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. The Rights
Agent may delay the processing of such transaction until it
receives evidence that all applicable taxes and governmental
charges have been paid.
(b) Upon receipt by the Corporation and the Rights
Agent of evidence 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
satisfactory to them, and, at the Corporation's request,
reimbursement to the Corporation 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 Corporation will make and
deliver a new Right Certificate of like tenor to the Rights
Agent for countersignature and delivery to the registered
holder in lieu of, the Right Certificate so lost, stolen,
destroyed or mutilated.
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<PAGE>
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights.
(a) Subject to Section 7(e) hereof, 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 and the certificate on the reverse side
thereof duly executed, to the Rights Agent at the office of
the Rights Agent designated for such purpose, together with
payment (in lawful money of the United States of America by
certified check or bank draft payable to the order of the
Corporation) of the aggregate Purchase Price for the total
number of one one-thousandths of a Preferred Share (or other
securities, as the case may be) as to which such surrendered
Rights are exercised, and an amount equal to any applicable
transfer tax or other governmental charge, at or prior to
the earliest of (i) the Close of Business on April 15, 2009
(the "Final Expiration Date"), (ii) the time at which the
Rights are redeemed as provided in Section 23 hereof (the
"Redemption Date"), and (iii) the time at which the Rights
are exchanged as provided in Section 24 hereof.
(b) The Purchase Price for each one one-thousandth of
a Preferred Share pursuant to the exercise of a Right shall
initially be $30.00, shall be subject to adjustment from
time to time as provided in the next sentence and in
Sections 11 and 13(a) hereof and shall be payable in
accordance with paragraph (c) of this Section 7. Anything
in this Agreement to the contrary notwithstanding, in the
event that, at any time after the date of this Agreement and
prior to the Distribution Date, the Corporation shall
(i) declare or pay any dividend on the Common Shares payable
in Common Shares or (ii) effect a subdivision, combination
or consolidation of the Common Shares (by reclassification
or otherwise than by payment of dividends in Common Shares)
into a greater or lesser number of Common Shares, then, in
any such case, each Common Share outstanding following such
subdivision, combination or consolidation shall continue to
have a Right associated therewith and the Purchase Price
following any such event shall be proportionately adjusted
to equal the result obtained by multiplying the Purchase
Price immediately prior to such event by a fraction the
numerator of which shall be the total number of Common
Shares outstanding immediately prior to the occurrence of
the event and the denominator of which shall be the total
number of Common Shares outstanding immediately following
the occurrence of such event. The adjustment provided for
in the preceding sentence shall be made successively
whenever such a dividend is declared or paid or such a
subdivision, combination or consolidation is effected.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase
and the certificate duly executed, accompanied by payment of
the Purchase Price for the Preferred Shares (or other
securities, as the case may be) to be purchased and an
amount equal to any applicable transfer tax or governmental
charge required to be paid by the holder of such Right
Certificate in accordance with Section 6 hereof by certified
check, cashier's check or money order payable to the order
of the Corporation, the Rights Agent shall thereupon
promptly (i) (A) requisition from any transfer agent of the
Preferred Shares certificates for the number of Preferred
Shares to be purchased
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<PAGE>
(and the Corporation hereby irrevocably authorizes its
transfer agent to comply with all such requests), or (B) if
the Corporation, in its sole discretion, shall have elected
to deposit the Preferred Shares issuable upon exercise of
the Rights hereunder into a depositary, requisition from the
depositary agent of depositary receipts representing such
number of one one-thousandths of a Preferred Share as are to
be purchased (in which case certificates for the Preferred
Shares represented by such receipts shall be deposited by
the transfer agent with the depositary agent) and the
Corporation will direct the depositary agent to comply with
such requests; (ii) when appropriate, requisition from the
Corporation the amount of cash to be paid in lieu of
issuance of fractional shares in accordance with Section 14
hereof; (iii) after receipt of such certificates or
depositary receipts, cause the same to be delivered to or
upon the order of the registered holder of such Right
Certificate, registered in such name or names as may be
designated by such holder; and (iv) when appropriate, after
receipt thereof, deliver such cash to or upon the order of
the registered holder of such Right Certificate. In the
event that the Corporation is obligated to issue other
securities (including Common Shares) of the Corporation
pursuant to Section 11(a) hereof, the Corporation will make
all arrangements necessary so that such other securities are
available for distribution by the Rights Agent, if and when
necessary to comply with this Agreement.
In addition, in the case of an exercise of the Rights
by a holder pursuant to Section 11(a)(ii) hereof, the Rights
Agent shall return such Right Certificate to the registered
holder thereof after imprinting, stamping or otherwise
indicating thereon that the rights represented by such Right
Certificate no longer include the rights provided by
Section 11(a)(ii) hereof and, if less than all the Rights
represented by such Right Certificate were so exercised, the
Rights Agent shall indicate on the Right Certificate the
number of Rights represented thereby which continue to
include the rights provided by Section 11(a)(ii) hereof.
(d) In case the registered holder of any Right
Certificate shall exercise less than all the Rights
evidenced thereby, a new Right Certificate evidencing Rights
equivalent 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 Sections 6 and 14 hereof, or the Rights
Agent shall place an appropriate notation on the Right
Certificate with respect to those Rights exercised.
(e) Notwithstanding anything in this Agreement to the contrary,
from and after the first occurrence of a Section 11(a)(ii) Event,
any Rights beneficially owned by (i) an Acquiring Person or an
Affiliate or Associate of an Acquiring Person, (ii) a transferee
of an Acquiring Person (or of any Affiliate or Associate thereof)
who becomes a transferee after the Acquiring Person becomes such,
or (iii) a transferee of an Acquiring Person (or of any Affiliate
or Associate thereof) who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and receives
such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person to holders of equity
interests in such Acquiring Person or to any Person with whom the
Acquiring Person has a continuing
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<PAGE>
agreement, arrangement or understanding regarding the
transferred Rights or (B) a transfer which the Board has
determined is part of an agreement, arrangement or
understanding which has as a primary purpose or effect the
avoidance of this Section 7(e), shall become null and void
without any further action and no holder of such Rights
shall have any rights whatsoever with respect to such
Rights, whether under any provision of this Agreement or
otherwise. The Corporation shall notify the Rights Agent
when this Section 7(e) applies and shall use all reasonable
efforts to insure that the provisions of this Section 7(e)
and Section 4(b) hereof are complied with, but neither the
Corporation nor the Rights Agent shall have any liability to
any holder of Right Certificates or other Person as a result
of the Corporation's failure to make any determinations with
respect to an Acquiring Person or its Affiliates, Associates
or any transferee of any of them hereunder.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Corporation shall
be obligated to undertake any action with respect to a
registered holder of Rights upon the occurrence of any
purported transfer pursuant to Section 6 hereof or exercise
as set forth in this Section 7, unless such registered
holder (i) shall have properly completed and signed the
certificate contained in the form of assignment or election
to purchase, as the case may be, set forth on the reverse
side of the Right Certificate surrendered for such transfer
or exercise, as the case may be, (ii) shall not have
indicated an affirmative response to clause 1 or 2 thereof,
and (iii) shall have provided such additional evidence of
the identity of the Beneficial Owner (or former Beneficial
owner) or Affiliates or Associates thereof as the
Corporation or the Rights Agent shall reasonably request.
Section 8. Cancellation and Destruction of Right
Certificates. All Right Certificates surrendered for the purpose
of exercise, transfer, split up, combination or exchange shall,
if surrendered to the Corporation or to any of its agents, be
delivered to the Rights Agent for cancellation or in cancelled
form, or, if surrendered to the Rights Agent, be cancelled by it,
and no Right Certificates shall be issued in lieu thereof except
as expressly permitted by any of the provisions of this
Agreement. The Corporation shall deliver to the Rights Agent for
cancellation and retirement, and the Rights Agent shall so cancel
and retire, any other Right Certificate purchased or acquired by
the Corporation otherwise than upon the exercise thereof. The
Rights Agent shall deliver all cancelled Right Certificates to
the Corporation, or shall, at the written request of the
Corporation, destroy such cancelled Right Certificates, and in
such case shall deliver a certificate of destruction thereof to
the Corporation.
Section 9. Reservation and Availability of Capital
Stock.
(a) The Corporation covenants and agrees that (i) at
all times prior to the occurrence of a Section 11(a)(ii)
Event, it will cause to be reserved and kept available out
of its authorized and unissued Preferred Shares, or any
authorized and issued Preferred Shares held in its treasury,
the number of Preferred Shares that will be sufficient to
permit the exercise in full of all outstanding Rights, and
(ii) after the occurrence of a Section 11(a)(ii)
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Event, it will, to the extent reasonably practicable, so
reserve and keep available a sufficient number of Common
Shares (and/or other securities) which may be required to
permit the exercise in full of the Rights pursuant to this
Agreement.
(b) So long as the Preferred Shares (and, after the
occurrence of a Section 11(a)(ii) Event, Common Shares or
any other securities) issuable upon the exercise of the
Rights may be listed on any stock exchange, the Corporation
shall use its best efforts to cause, from and after such
time as the Rights become exercisable, all securities
reserved for such issuance to be listed on such exchange
upon official notice of issuance upon such exercise.
(c) The Corporation covenants and agrees that it will
take all such action as may be necessary to ensure that all
Preferred Shares (or Common Shares and/or other securities,
as the case may be) delivered upon exercise of Rights shall,
at the time of delivery of the certificates for such shares
or other securities (subject to payment of the Purchase
Price), be duly and validly authorized and issued and fully
paid and non-assessable shares or securities.
(d) The Corporation further covenants and agrees that
it will pay when due and payable any and all federal and
state transfer taxes and other governmental charges which
may be payable in respect of the issuance or delivery of the
Right Certificates or of any Preferred Shares (or Common
Shares and/or other securities, as the case may be) upon the
exercise of Rights. The Corporation shall not, however, be
required to pay any transfer tax or other governmental
charge which may be payable in respect of any transfer or
delivery of Right Certificates to a Person other than, or
the issuance or delivery of certificates or depositary
receipts for the Preferred Shares (or Common Shares and/or
other securities, as the case may be) in a name other than
that of, the registered holder of the Right Certificate
evidencing Rights surrendered for exercise, or to issue or
to deliver any certificates or depositary receipts for
Preferred Shares (or Common Shares and/or other securities,
as the case may be) upon the exercise of any Rights, until
any such tax or other governmental charge shall have been
paid (any such tax being payable by the holder of such Right
Certificate at the time of surrender) or until it has been
established to the Corporation's satisfaction that no such
tax or other governmental charge is due.
(e) The Corporation shall use its best efforts to (i) file, as
soon as practicable following the Shares Acquisition Date (or, if
required by law, at such earlier time following the Distribution
Date as so required), a registration statement under the Act,
with respect to the securities purchasable upon exercise of the
Rights on an appropriate form, (ii) cause such registration
statement to become effective as soon as practicable after such
filing, and (iii) cause such registration statement to remain
effective (with a prospectus at all times meeting the require
ments of the Act and the rules and regulations thereunder) until
the date of the expiration of the rights provided by
Section 11(a)(ii) hereof. The Corporation will also take such
action as may be appropriate under the blue sky or securities
laws of any applicable states and other jurisdictions. The
Corporation may temporarily suspend, for a period of time
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<PAGE>
not to exceed 90 days after the date set forth in clause (i)
of this Section 9(e), the exercisability of the Rights in
order to prepare and file such registration statement and
permit it to become effective. Upon any such suspension,
the Corporation 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
such provision of this Agreement to the contrary, the Rights
shall not be exercisable for securities in any jurisdiction
if the requisite qualification in such jurisdiction shall
not have been obtained, such exercise therefor shall not be
permitted under applicable law, or a registration statement
in respect of such securities shall not have been declared
effective.
Section 10. Preferred Shares Record Date. Each Person in
whose name any certificate for Preferred Shares (or Common Shares
and/or other securities, as the case may be) is issued upon the
exercise of Rights shall for all purposes be deemed to have
become the holder of record of the Preferred Shares (or Common
Shares and/or other securities, as the case may be) represented
thereby on, and such certificate shall be dated, the date upon
which the Right Certificate evidencing such Rights was duly
surrendered and payment of the Purchase Price (and any applicable
transfer taxes and other governmental charges) was made;
provided, however, that, if the date of such surrender and
payment is a date upon which the transfer books of the
Corporation relating to the Preferred Shares (or Common Shares
and/or other securities, as the case may be) are closed, such
Person shall be deemed to have become the record holder of such
shares on, and such certificate shall be dated, the next
succeeding Business Day on which the applicable transfer books
are open.
Section 11. Adjustment of Purchase Price, Number and Kind
of Shares or Number of Rights. The Purchase Price, the number
and kind of shares covered by each Right and the number of Rights
outstanding are subject to adjustment from time to time as
provided in this Section 11.
(a) (i) In the event the Corporation shall at any time
after the date of this Agreement (A) declare a dividend
on the Preferred Shares payable in Preferred Shares,
(B) subdivide the outstanding Preferred Shares into a
greater number of Preferred Shares, (C) combine the
outstanding Preferred Shares into a smaller number of
Preferred Shares, or (D) issue any shares of its
capital stock in a reclassification of the Preferred
Shares (including without limitation any such
reclassification in connection with a consolidation or
merger in which the Corporation is the continuing or
surviving corporation), except as otherwise provided in
this Section 11(a) and Section 7(e) hereof, the
Purchase Price in effect immediately prior to 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
after such time shall (except as otherwise provided
herein, including without limitation Section 7(e)
hereof) thereafter be entitled to receive, upon
exercise thereof at the Purchase Price in effect
immediately prior to such date, the aggregate number
and kind of shares of capital stock which, if such
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Right had been exercised immediately prior to such date
and at a time when the applicable transfer books of the
Corporation were open, such holder would have been
entitled to receive upon such exercise and by virtue of
such dividend, subdivision, combination or
reclassification; provided, however, that in no event
shall the consideration to be paid upon the exercise of
one Right be less than the aggregate par value of the
shares of capital stock of the Corporation issuable
upon exercise of one Right. If an event occurs which
would require an adjustment under both this
Section 11(a)(i) and Section 11(a)(ii) hereof, 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)
hereof.
(ii) In the event any Person, alone or together
with its Affiliates and Associates, shall, at any time
after the date of this Agreement, become an Acquiring
Person, then proper provision shall be made so that
each holder of a Right shall (except as provided below
and in Section 7(e) hereof), for a period of 60 days
after the later of the occurrence of any such event or
the effective date of an appropriate registration
statement under the Act pursuant to Section 9 hereof,
have a right to receive, upon exercise thereof at a
price equal to the then current Purchase Price, in
accordance with the terms of this Agreement, in lieu of
Preferred Shares, such number of duly authorized,
validly issued, fully paid and non-assessable Common
Shares (or, in the discretion of the Board, one
one-thousandths of a Preferred Share) as shall equal
the result obtained by (A) multiplying the then current
Purchase Price by the then number of one
one-thousandths of a Preferred Share for which a Right
was exercisable immediately prior to the first
occurrence of a Section 11(a)(ii) Event, and dividing
that product by (B) 50 percent of the then current per
share market price of the Common Shares (determined
pursuant to Section 11(d) hereof) on the date of such
first occurrence (such number of shares being referred
to as the "Adjustment Shares"); provided, however,
that, if the transaction that would otherwise give rise
to the foregoing adjustment is also subject to the
provisions of Section 13 hereof, then only the
provisions of Section 13 hereof shall apply and no
adjustment shall be made pursuant to this
Section 11(a)(ii).
(iii) In the event that there shall not be
sufficient treasury shares or authorized but unissued
(and unreserved) Common Shares to permit the exercise
in full of the Rights in accordance with
Section 11(a)(ii) hereof and the Rights become so
exercisable (and the Board has determined to make the
Rights exercisable into fractions of a Preferred
Share), notwithstanding any other provision of this
Agreement, to the extent necessary and permitted by
applicable law, each Right shall thereafter represent
the right to receive, upon exercise thereof at the then
current Purchase Price in accordance with the terms of
this Agreement, (A) a number of (or fractions of)
Common Shares (up to the maximum number of Common
Shares which may permissibly be issued) and (B) one
one-thousandths of a Preferred Share or a number of, or
fractions of other equity securities of the Corporation
(or, in the
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discretion of the Board, debt) which the Board has
determined to have the same aggregate current market
value (determined pursuant to Sections 11(d)(i)
and (ii) hereof, to the extent applicable) as one
Common Share (such number of, or fractions of,
Preferred Shares or other equity securities or debt of
the Corporation being referred to as a "capital stock
equivalent"), equal in the aggregate to the number of
Adjustment Shares; provided, however, if sufficient
Common Shares and/or capital stock equivalents are
unavailable, then the Corporation shall, to the extent
permitted by applicable law, take all such action as
may be necessary to authorize additional Common Shares
or capital stock equivalents for issuance upon exercise
of the Rights, including the calling of a meeting of
stockholders; and provided further, that, if the
Corporation is unable to cause sufficient Common Shares
and/or capital stock equivalents to be available for
issuance upon exercise in full of the Rights, then each
Right shall thereafter represent the right to receive
the Adjusted Number of Shares upon exercise at the
Adjusted Purchase Price (as such terms are hereinafter
defined). As used herein, the term "Adjusted Number of
Shares" shall mean that number of (or fractions of)
Common Shares (and/or capital stock equivalents) equal
to the product of (X) the number of Adjustment Shares
and (Y) a fraction, the numerator of which is the
number of Common Shares (and/or capital stock
equivalents) available for issuance upon exercise of
the Rights and the denominator of which is the
aggregate number of Adjustment Shares otherwise
issuable upon exercise in full of all Rights (assuming
there were a sufficient number of Common Shares
available) (such fraction being referred to as the
"Proration Factor"). The "Adjusted Purchase Price"
shall mean the product of the Purchase Price and the
Proration Factor. The Board may, but shall not be
required to, establish procedures to allocate the right
to receive Common Shares and capital stock equivalents
upon exercise of the Rights among holders of Rights.
(b) In case the Corporation shall fix a record date
for the issuance of rights (other than the Rights), options
or warrants to all holders of Preferred Shares entitling
them (for a period expiring within 45 calendar days after
such record date) to subscribe for or purchase Preferred
Shares (or shares having the same rights, privileges and
preferences as the Preferred Shares ("equivalent preferred
shares")) or securities convertible into or exercisable for
Preferred Shares or equivalent preferred shares at a price
per Preferred Share or equivalent preferred share (or having
a conversion price per share, if a security convertible into
Preferred Shares or equivalent preferred shares) less than
the then current per share market price of the Preferred
Shares (as determined pursuant to Section 11(d) hereof) 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 Preferred Shares outstanding on such record date
plus the number of Preferred Shares which the aggregate
offering price of the total number of Preferred Shares
and/or equivalent preferred shares so to be offered (and/or
the aggregate initial conversion price of the convertible
securities so to be offered) would purchase at such current
per share market price, and the denominator of which shall
be the
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number of Preferred Shares outstanding on such record date
plus the number of additional Preferred Shares and/or
equivalent preferred shares to be offered for subscription
or purchase (or into which the convertible securities so to
be offered are initially convertible); provided, however,
that in no event shall the consideration to be paid upon the
exercise of one Right be less than the aggregate par value
of the shares of capital stock of the Corporation issuable
upon exercise of one Right. In case such subscription price
may be paid by delivery of consideration part or all of
which shall be in a form other than cash, the value of such
consideration shall be as determined in good faith by the
Board, whose determination shall be described in a statement
filed with the Rights Agent and shall be conclusive for all
purposes. Preferred Shares owned by or held for the account
of the Corporation shall not be deemed outstanding for the
purpose of any such computation. Such adjustment shall be
made successively whenever such a record date is fixed; and
in the event that such rights, options or warrants are not
so issued, the Purchase Price shall be adjusted to be the
Purchase Price which would then be in effect if such record
date had not been fixed.
(c) In case the Corporation shall fix a record date
for the making of a distribution to all holders of the
Preferred Shares (including any such distribution made in
connection with a consolidation or merger in which the
Corporation is the continuing or surviving corporation) of
evidences of indebtedness, equity securities other than
Preferred Shares or assets (other than a regular periodic
cash dividend or a dividend payable in Preferred Shares) or
subscription rights, options or warrants (excluding those
referred to in Section 11(b) hereof), 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 (as
determined pursuant to Section 11(d) hereof) of the
Preferred Shares on such record date, less the fair market
value (as determined in good faith by the Board, whose
determination shall be described in a statement filed with
the Rights Agent and shall be conclusive for all purposes)
of the portion of the assets, equity securities or evidences
of indebtedness so to be distributed or of such subscription
rights, options or warrants applicable to one Preferred
Share, and the denominator of which shall be such current
per share market price of the Preferred Shares; provided,
however, that in no event shall the consideration to be paid
upon the exercise of one Right be less than the aggregate
par value of the shares of capital stock of the Corporation
to be issued upon exercise of one Right. Such adjustments
shall be made successively whenever such a record date is
fixed; and, in the event that such distribution is not so
made, the Purchase Price shall again be adjusted to be the
Purchase Price which would then be in effect if such record
date had not been fixed.
(d) (i) For the purpose of any computation hereunder, the
"current per share market price" of any security (a "Security"
for the purpose of this Section 11(d)(i)) on any date shall be
deemed to be the average of the daily closing prices per share of
such Security for the 30 consecutive Trading Days immediately
prior to and not including such date; provided, however, that, in
the event the current per share market price of the Security is
determined during a period following the
17
<PAGE>
announcement by the issuer of such Security of (A) a
dividend or distribution on such Security payable in
shares of such Security or securities convertible into
such shares or (B) any subdivision, combination or
reclassification of such Security and prior to the
expiration of 30 Trading Days after the ex-dividend
date for such dividend or distribution or the record
date for such subdivision, combination or reclassifi
cation, then, and in each such case, the current per
share market price shall be appropriately adjusted to
reflect the current market price per share equivalent
of such Security. The closing price for each day shall
be the last sale price, regular way, or, in case no
such sale takes place on such day, the average of the
closing bid and asked prices, regular way, in either
case as reported in the principal consolidated
transaction reporting system with respect to securities
listed or admitted to trading on the New York Stock
Exchange or, if the Security is not listed or admitted
to trading on the New York Stock Exchange, as reported
in the principal consolidated transaction reporting
system with respect to securities listed on the
principal national securities exchange on which the
Security is listed or admitted to trading or, if the
Security is not listed or admitted to trading on any
national securities exchange, the last quoted price or,
if not so quoted, the average of the high bid and low
asked prices in the over-the-counter market, as
reported by The Nasdaq Stock Market ("NASDAQ") or such
other system then in use, or, if on any such date the
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 the Security selected by the Board. If on
any such date no such market maker is making a market
in the Security, the fair value of the Security on such
date as determined in good faith by the Board shall be
used. The term "Trading Day" shall mean a day on which
the principal national securities exchange on which the
Security is listed or admitted to trading is open for
the transaction of business or, if the Security is not
listed or admitted to trading on any national
securities exchange, a Business Day.
(ii) For the purpose of any computation hereunder,
the "current per share market price" of the Preferred
Shares shall be determined in accordance with the
method set forth in Section 11(d)(i) hereof. If the
Preferred Shares are not publicly traded, the "current
per share market price" of the Preferred Shares shall
be conclusively deemed to be the current per share
market price of the Common Shares as determined
pursuant to Section 11(d)(i) hereof (appropriately
adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date of this
Agreement), multiplied by 1,000. If neither the Common
Shares nor the Preferred Shares are publicly held or so
listed or traded, "current per share market price" of
the Preferred Shares shall mean the fair value per
share as determined in good faith by the Board, whose
determination shall be described in a statement filed
with the Rights Agent and shall be conclusive for all
purposes.
(e) Anything herein to the contrary notwithstanding,
no adjustment in the Purchase Price shall be required unless
such adjustment would require an increase or
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<PAGE>
decrease of at least 1percent 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 one one-millionth of a Preferred Share or
one ten-thousandth of any other share or security, as the case
may be. Notwithstanding the first sentence of this
Section 11(e), any adjustment required by this Section 11 shall
be made no later than the earlier of (i) three years from the
date of the transaction which mandates such adjustment or
(ii) the Final Expiration Date.
(f) If, as a result of an adjustment made pursuant to
Section 11(a)(ii) or 13(a) hereof, the holder of any Right
thereafter exercised shall become entitled to receive, upon
exercise of such Right, any shares of capital stock of the
Corporation other than Preferred Shares, thereafter the
number of 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 Preferred Shares
contained in Sections 11(a) through (c) hereof, inclusive,
and the provisions of Sections 7, 9, 10, 13 and 14 hereof
with respect to the Preferred Shares shall apply on like
terms to any such other shares.
(g) All Rights originally issued by the Corporation
subsequent to any adjustment made hereunder shall evidence
the right to purchase, at the adjusted Purchase Price, the
number of one one-thousandths of a Preferred Share and other
capital stock of the Corporation purchasable from time to
time hereunder upon exercise of the Rights, all subject to
further adjustment as provided herein.
(h) The Corporation may elect, on or after the date of
any adjustment of the Purchase Price, to adjust the number
of Rights, in lieu of any adjustment in the number of one
one-thousandths of a Preferred Share purchasable upon the
exercise of a Right. Each of the Rights outstanding after
such adjustment of the number of Rights shall be exercisable
for the number of one one-thousandths of a Preferred Share
for which a Right was exercisable immediately prior to such
adjustment. Each Right held of record prior to such
adjustment of the number of Rights shall become that number
of Rights (calculated to the nearest one ten-thousandth)
obtained by dividing the Purchase Price in effect
immediately prior to adjustment of the Purchase Price by the
Purchase Price in effect immediately after adjustment of the
Purchase Price. The Corporation shall make a public
announcement (and shall promptly deliver a copy of such
announcement 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. If Right Certificates have been issued, upon
each adjustment of the number of Rights pursuant to this
Section 11(h), the Corporation 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
19
<PAGE>
a result of such adjustment or, at the option of the
Corporation, 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
Corporation, 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 countersigned in the manner provided
for herein (and may, at the option of the Corporation,
reflect the adjusted Purchase Price) and shall be registered
in the names of the holders of record of Right Certificates
on the record date specified in the public announcement.
(i) Irrespective of any adjustment or change in the
Purchase Price or the number of one one-thousandths of a
Preferred Share 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 one
one-thousandths of a Preferred Share which were expressed in
the initial Right Certificates issued hereunder.
(j) Before taking any action that would cause an
adjustment reducing the Purchase Price below the then par
value, if any, of the number of one one-thousandths of a
Preferred Share, Common Shares or other securities issuable
upon exercise of the Rights, the Corporation shall take any
corporate action which may, in the opinion of its counsel,
be necessary in order that the Corporation may validly and
legally issue such number of fully paid and non-assessable
one one-thousandths of a Preferred Share, Common Shares or
other securities at such adjusted Purchase Price.
(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 Corporation
may elect (and shall provide the Rights Agent with notice of
such election) to defer, until the occurrence of such event,
the issuance to the holder of any Right exercised after such
record date of the Preferred Shares, Common Shares or other
securities of the Corporation, if any, issuable upon such
exercise over and above the Preferred Shares, Common Shares
or other securities of the Corporation, if any, issuable
upon exercise on the basis of the Purchase Price in effect
prior to such adjustment; provided, however, that the
Corporation shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder's right to
receive such additional shares upon the occurrence of the
event requiring such adjustment.
(l) Anything in this Section 11 to the contrary
notwithstanding, the Corporation 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 (i) consolidation or
subdivision of the Preferred Shares, (ii) issuance wholly
for cash of Preferred Shares at less than the current market
price, (iii) issuance wholly for cash of Preferred Shares or
securities which by their terms are convertible into or
exchangeable for Preferred Shares, (iv) stock dividends, or
(v) issuance of rights, options or warrants referred to in
this Section 11, hereafter made
20
<PAGE>
by the Corporation to holders of its Preferred Shares shall
not be taxable to such stockholders.
(m) The Corporation covenants and agrees that it will
not, at any time after the Distribution Date,
(i) consolidate, merge or otherwise combine with any other
Person (other than a Subsidiary of the Corporation in a
transaction which does not violate Section 11(n) hereof), or
(ii) sell or otherwise transfer (or permit any Subsidiary of
the Corporation to sell or otherwise transfer), in one
transaction or a series of related transactions, assets or
earning power aggregating more than 50percent of the assets
or earning power of the Corporation and its Subsidiaries
(taken as a whole) to any other Person or Persons (other
than the Corporation and/or any of its Subsidiaries in one
or more transactions each of which does not violate
Section 11(n) hereof), if (x) at the time of or immediately
after such consolidation, merger, combination, sale or
transfer there are any charter or by-law provisions or any
rights, warrants or other instruments or securities
outstanding or agreements in effect or other actions taken,
which would materially diminish or otherwise eliminate the
benefits intended to be afforded by the Rights, or (y) prior
to, simultaneously with or immediately after such
consolidation, merger, combination, sale or transfer, the
stockholders of the Person who constitutes, or would
constitute, the Principal Party (for purposes of
Section 13(a) hereof) shall have received a distribution of
Rights previously owned by such Person or any of its
Affiliates and Associates. The Corporation shall not
consummate any such consolidation, merger, combination, sale
or transfer unless prior thereto the Corporation and such
other Person shall have executed and delivered to the Rights
Agent a supplemental agreement evidencing compliance with
this Section 11(m).
(n) The Corporation covenants and agrees that, after
the Distribution Date, it will not, except as permitted by
Section 23, 24 or 27 hereof, take (or permit any of its
Subsidiaries to take) any action the purpose of which is to,
or if at the time such action is taken it is reasonably
foreseeable that the effect of such action would be to,
materially diminish or otherwise eliminate the benefits
intended to be afforded by the Rights.
(o) The exercise of Rights under Section 11(a)(ii)
hereof shall only result in the loss of rights under said
Section 11(a)(ii) to the extent so exercised and shall not
otherwise affect the rights represented by the Rights under
this Agreement, including the rights represented by
Section 13 hereof.
(p) Unless the Corporation shall have exercised its
election as provided in Section 11(h) hereof, upon each
adjustment of the Purchase Price as a result of the
calculations made in Section 11(b) or (c) hereof, each Right
outstanding immediately prior to the making of such
adjustment shall thereafter evidence the right to purchase,
at the adjusted Purchase Price, that number of one
one-thousandths of a Preferred Share (calculated to the
nearest one-millionth) obtained by (i) multiplying (A) the
number of one one-thousandths of a share for which a Right
was exercisable immediately prior to this adjustment by
(B) the Purchase Price in effect immediately prior to such
adjustment of the
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<PAGE>
Purchase Price, and (ii) dividing the product so obtained by
the Purchase Price in effect immediately after such
adjustment of the Purchase Price.
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 Corporation shall promptly
(a) prepare a certificate setting forth such adjustment, and a
brief, reasonably detailed statement of the facts, computations
and methodology giving rise to such adjustment, (b) file with the
Rights Agent and with each transfer agent for the Common Shares
and the Preferred Shares a copy of such certificate, and (c) mail
a brief summary thereof to each holder of a Right Certificate
(or, if prior to the Distribution Date, to each holder of a
certificate representing Common Shares) in accordance with
Section 26 hereof. The Rights Agent shall be fully protected in
relying on any such certificate and on any adjustment therein
contained and shall have no duty with respect to and shall not be
deemed to have knowledge of such adjustment unless and until it
shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power.
(a) In the event that, on or following the Shares
Acquisition Date, directly or indirectly, (x) the
Corporation shall consolidate with, merge with and into, or
otherwise combine with any Person (and the Corporation shall
not be the continuing or surviving corporation of such
consolidation, merger or combination), (y) the Corporation
shall merge or otherwise combine with any Person, and the
Corporation shall be the continuing or surviving corporation
of such merger or combination (other than, in a case of any
transaction described in clause (x) or (y) above, a merger,
consolidation or combination which would result in all of
the securities generally entitled to vote in the election of
directors ("voting securities") of the Corporation
outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being
converted into securities of the surviving entity) all of
the voting securities of the Corporation or such surviving
entity outstanding immediately after such merger,
consolidation or combination and the holders of such
securities not having changed as a result of such merger,
consolidation or combination), or (z) the Corporation shall
sell or otherwise transfer (or one or more of its
Subsidiaries shall sell or otherwise transfer), in one
transaction or a series of related transactions, assets or
earning power aggregating more than 50 percent of the assets
or earning power of the Corporation and its Subsidiaries
(taken as a whole) to any Person (other than the Corporation
or any Subsidiary of the Corporation in one or more
transactions each of which does not violate Section 11(n)
hereof), then, and in each such case (except as provided in
Section 13(d) hereof), proper provision shall be made 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 at a price equal to the
then current Purchase Price, in accordance with the terms of
this Agreement and in lieu of Preferred Shares, such number
of duly authorized, validly issued, fully paid,
non-assessable and freely tradeable Common Shares of the
Principal Party (as hereinafter defined), not subject to any
liens, encumbrances, rights of call or first refusal or
other adverse claims, as shall equal the result obtained by
(A) multiplying the then current Purchase Price by the
number of one one-thousandths of a Preferred Share for which
a Right
22
<PAGE>
is then exercisable (without taking into account any
adjustment previously made pursuant to Section 11(a)(ii)
hereof) and dividing that product by (B) 50 percent of the
then current per share market price of the Common Shares of
such Principal Party (determined pursuant to
Section 11(d)(i) hereof) on the date of consummation of such
Section 13 Event; (ii) such Principal Party shall thereafter
be liable for, and shall assume, by virtue of such
Section 13 Event, all the obligations and duties of the
Corporation pursuant to this Agreement; (iii) the term
"Corporation" shall thereafter be deemed to refer to such
Principal Party, it being specifically intended that the
provisions of Section 11 hereof shall apply only to such
Principal Party following the first occurrence of a
Section 13 Event; and (iv) such Principal Party shall take
such steps (including without limitation the authorization
and reservation of a sufficient number of its Common Shares
to permit exercise of all outstanding Rights in accordance
with this Section 13(a)) in connection with the consummation
of any such transaction as may be necessary to assure that
the provisions hereof shall thereafter be applicable, as
nearly as reasonably may be, in relation to the Common
Shares of such Principal Party thereafter deliverable upon
the exercise of the Rights.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in
clause (x) or (y) of the first sentence of
Section 13(a) hereof, the Person that is the issuer of
any securities into which Common Shares of the
Corporation are converted in such merger, consolidation
or combination, and if no securities are so issued, the
Person that survives or results from such merger,
consolidation or combination; and
(ii) in the case of any transaction described in
clause (z) of the first sentence of Section 13(a)
hereof, the Person that is the party receiving the
greatest portion of the assets or earning power
transferred pursuant to such transaction or
transactions;
provided, however, that, in any of the foregoing cases,
(A) if the Common Shares of such Person are not at such
time and have not been continuously over the preceding
12 month period registered under Section 12 of the
Exchange Act, and such Person is a direct or indirect
Subsidiary of another Person the Common Shares of which
are and have been so registered, "Principal Party"
shall refer to such other Person; (B) in case such
Person is a Subsidiary, directly or indirectly, of more
than one Person, the Common Shares of two or more of
which are and have been so registered, "Principal
Party" shall refer to whichever of such Persons is the
issuer of the Common Shares having the greatest
aggregate market value; and (C) in case such Person is
owned, directly or indirectly, by a joint venture
formed by two or more Persons that are not owned,
directly or indirectly, by the same Person, the rules
set forth in clauses (A) and (B) above shall apply to
each of the chains of ownership having an interest in
such joint venture as if such party were a "Subsidiary"
of both or all of such joint venturers and the
Principal Parties in each such chain shall bear the
obligations set
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<PAGE>
forth in this Section 13 in the same ratio as their direct
or indirect interests in such Person bear to the total of
such interests.
(c) The Corporation shall not consummate any such
consolidation, merger, combination, sale or transfer unless
the Principal Party shall have a sufficient number of its
authorized Common Shares which have not been issued or
reserved for issuance to permit the exercise in full of the
Rights in accordance with this Section 13 and unless prior
thereto the Corporation and such Principal Party shall have
executed and delivered to the Rights Agent a supplemental
agreement providing for the terms set forth in
Sections 13(a) and (b) hereof and further providing that, as
soon as practicable after the date of any consolidation,
merger, combination, sale or transfer mentioned in
Section 13(a) hereof, the Principal Party, at its own
expense, shall:
(i) prepare and file a registration statement
under the Act with respect to the Rights and the
securities purchasable upon exercise of the Rights on
an appropriate form, and will use its best efforts to
cause such registration statement to (A) become
effective as soon as practicable after such filing and
(B) remain effective (with a prospectus at all times
meeting the requirements of the Act) until the Final
Expiration Date;
(ii) use its best efforts to qualify or register
the Rights and the securities purchasable upon exercise
of the Rights under the blue sky or securities laws of
such jurisdictions as may be necessary or appropriate;
and
(iii) deliver to holders of the Rights
historical financial statements for the Principal Party
which comply in all respects with the requirements for
registration on Form 10 under the Exchange Act.
The provisions of this Section 13 shall similarly apply to
successive mergers, consolidations, combinations, sales and
other transfers. The rights under this Section 13 shall be
in addition to the rights to exercise Rights and adjustments
under Section 11(a)(ii) hereof and shall survive any
exercise thereof.
(d) Notwithstanding anything in this Agreement to the
contrary, this Section 13 shall not be applicable to a
transaction described in clauses (x) and (y) of
Section 13(a) hereof if: (i) such transaction is consummated
with a Person or Persons who acquired Common Shares pursuant
to a Permitted Offer (or a wholly owned Subsidiary of any
such Person or Persons); (ii) the price per Common Share
offered in such transaction is not less than the price per
Common Share paid to all holders of Common Shares whose
shares were purchased pursuant to such Permitted Offer; and
(iii) the form of consideration offered in such transaction
is the same as the form of consideration paid pursuant to
such Permitted Offer. Upon consummation of any such
transaction contemplated by this Section 13(d), all Rights
hereunder shall expire.
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Section 14. Fractional Rights and Fractional Shares.
(a) The Corporation shall not be required to issue
fractions of Rights or to distribute Right Certificates
which evidence fractional Rights. In lieu of such
fractional Rights, there shall be paid to the registered
holders of the Right Certificates, with regard to which such
fractional Rights would otherwise be issuable, an amount in
cash equal to the same fraction of the current market value
of a whole Right. For the purposes of this Section 14(a),
the current market value of a whole Right shall be the
closing price of the Rights for the Trading Day immediately
prior to the date on which such fractional Rights would have
been otherwise issuable. The closing price for any day
shall be the last sale price, regular way, or, in case no
such sale takes place on such day, the average of the
closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the Rights are
not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities
listed on the principal national securities exchange on
which the Rights are listed or admitted to trading or, if
the Rights are not listed or admitted to trading on any
national securities exchange, the last quoted price or, if
not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by NASDAQ
or such other system then in use or, if on any such date the
Rights are not quoted by any such organization, the average
of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights
selected by the Board. If on any such date no such market
maker is making a market in the Rights, the fair value of
the Rights on such date as determined in good faith by the
Board shall be used.
(b) The Corporation shall not be required to issue
fractions of Preferred Shares (other than fractions which
are one one-thousandth or integral multiples of one
one-thousandth of a Preferred Share) upon exercise of the
Rights or to distribute certificates which evidence
fractional Preferred Shares (other than fractions which are
one one-thousandth or integral multiples of one
one-thousandth of a Preferred Share). Fractions of
Preferred Shares in integral multiples of one one-thousandth
of a Preferred Share may, at the election of the
Corporation, be evidenced by depositary receipts, pursuant
to an appropriate agreement between the Corporation and a
depositary selected by it; provided, that such agreement
shall provide that the holders of such depositary receipts
shall have the rights, privileges and preferences to which
they are entitled as beneficial owners of the Preferred
Shares represented by such depositary receipts. In lieu of
fractional Preferred Shares that are not one one-thousandth
or integral multiples of one one-thousandth of a Preferred
Share, the Corporation shall pay to the registered holders
of Right Certificates at the time such Rights are exercised
as herein provided an amount in cash equal to the same
fraction of the current market value of one one-thousandth
of a Preferred Share. For the purposes of this
Section 14(b), the current market value of one
one-thousandth of a Preferred Share shall be one
one-thousandth of the closing price of a Preferred Share (as
determined
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pursuant to Section 11(d)(ii) hereof) for the Trading Day
immediately prior to the date of such exercise.
(c) Following the occurrence of one of the
transactions or events specified in Section 11 hereof giving
rise to the right to receive Common Shares, capital stock
equivalents (other than Preferred Shares) or other
securities upon the exercise of a Right, the Corporation
shall not be required to issue fractions of shares or units
of such Common Shares, capital stock equivalents or other
securities upon exercise of the Rights or to distribute
certificates which evidence fractions of such Common Shares,
capital stock equivalents or other securities. In lieu of
fractional shares or units of such Common Shares, capital
stock equivalents or other securities, the Corporation may
pay to the registered holders of Right Certificates at the
time such Rights are exercised as herein provided an amount
in cash equal to the same fraction of the current market
value of a share or unit of such Common Shares, capital
stock equivalents or other securities. For purposes of this
Section 14(c), the current market value shall be determined
in the manner set forth in Section 11(d) hereof for the
Trading Day immediately prior to the date of such exercise
and, if such capital stock equivalent is not traded, each
such capital stock equivalent shall have the value of one
one-thousandth of a Preferred Share.
(d) The holder of a Right, by the acceptance of the
Right, expressly waives his right to receive any fractional
Rights or any fractional share upon exercise of a Right
(except as permitted by this Section 14).
Section 15. Rights of Action. All rights of action in
respect of this Agreement (except the rights of action given to
the Rights Agent under Section 18 hereof) are vested in the
respective registered holders of the Right Certificates (and,
prior to the Distribution Date, the registered holders of the
Common Shares); and any registered holder of any Right
Certificate (or, prior to the Distribution Date, of the Common
Shares), without the consent of the Rights Agent or of the holder
of any other Right Certificate (or, prior to the Distribution
Date, of the Common Shares), may, in his own behalf and for his
own benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Corporation to enforce, or
otherwise act in respect of, his right to exercise the Rights
evidenced by such Right Certificate (or, prior to the
Distribution Date, such Common Shares) in the manner provided in
such Right Certificate and in this Agreement. Without limiting
the foregoing or any remedies available to the holders of Rights,
it is specifically acknowledged that the holders of Rights would
not have an adequate remedy at law for any breach of this
Agreement and will be entitled to specific performance of the
obligations under, and injunctive relief against actual or
threatened violations of the obligations of any Person subject
to, this Agreement.
Section 16. Agreement of Right Holders. Every holder of
a Right, by accepting the same, consents and agrees with the
Corporation and the Rights Agent and with every other holder of a
Right as follows:
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(a) Prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the
Common Shares.
(b) After the Distribution Date, the Right
Certificates are transferable only on the registry books of
the Rights Agent if surrendered at the office of the Rights
Agent designated for such purpose, duly endorsed or
accompanied by a proper instrument of transfer and with the
appropriate form fully executed.
(c) Subject to Sections 6 and 7(f) hereof, the
Corporation and the Rights Agent may deem and treat the
Person in whose name the Right Certificate (or, prior to the
Distribution Date, the associated Common Shares certificate)
is registered as the absolute owner thereof and of the
Rights evidenced thereby (notwithstanding any notations of
ownership or writing on the Right Certificate or the
associated Common Shares certificate made by anyone other
than the Corporation or the Rights Agent) for all purposes
whatsoever, and neither the Corporation nor the Rights
Agent, subject to the last sentence of Section 7(e) hereof,
shall be affected by any notice to the contrary.
(d) Notwithstanding anything in this Agreement to the
contrary, neither the Corporation nor the Rights Agent shall
have any liability to any holder of a Right or a beneficial
interest in 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, judgment or ruling
(whether interlocutory or final) issued by a court of
competent jurisdiction or by a governmental, regulatory or
administrative agency or commission, or any statute, rule,
regulation or executive order promulgated or enacted by any
governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, the
Corporation must use its best efforts to have any such
order, decree, judgment or ruling lifted or otherwise
overturned as soon as possible.
Section 17. Right Certificate Holder Not Deemed a
Stockholder. No holder of any Right Certificate, as such, shall
be entitled to vote, receive dividends or other distributions or
be deemed for any purpose the holder of the Preferred Shares or
any other securities of the Corporation which may at any time be
issuable upon the exercise or exchange of the Rights represented
thereby, nor shall anything contained herein or in any Right
Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a stockholder of the
Corporation or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting
stockholders (except as provided in Section 25 hereof), or to
receive dividends or other distributions or to exercise any
preemptive or subscription rights, or otherwise, until the Right
or Rights evidenced by such Right Certificate shall have been
exercised or exchanged in accordance with the provisions hereof.
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Section 18. Concerning the Rights Agent.
(a) The Corporation agrees to pay to the Rights Agent
reasonable compensation for all services rendered by the
Rights Agent hereunder and, from time to time, on demand of
the Rights Agent, its reasonable expenses and counsel fees
and other disbursements incurred in the preparation,
delivery, amendment, administration and execution of this
Agreement and the exercise and performance of its duties
hereunder. The Corporation also agrees to indemnify the
Rights Agent for, and to hold it harmless against, any loss,
liability, damage, judgment, fine, penalty, claim, demand,
settlement, cost or expense, incurred without gross
negligence, bad faith or willful misconduct on the part of
the Rights Agent, for any action taken, suffered or omitted
by the Rights Agent in connection with the acceptance and
administration of this Agreement or the exercise or
performance of its duties hereunder, including without
limitation the reasonable costs and expenses of defending
against any claim of liability in the premises. The
indemnity provided for herein shall survive the expiration
of the Rights and the termination of this Agreement.
(b) The Rights Agent shall be authorized and protected
and shall incur no liability for, or in respect of, any
action taken, suffered or omitted by it in connection with,
the acceptance and administration of this Agreement or the
exercise or performance of its duties hereunder in reliance
upon any Right Certificate or certificate for Common Shares
or for other securities of the Corporation, instrument of
assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, instruction, direction, consent,
certificate, statement, or other paper or document believed
by it to be genuine and to be signed, executed and, where
necessary, verified or acknowledged, by the proper Person or
Persons, or otherwise upon the advice of counsel as set
forth in Section 20 hereof.
Section 19. Merger or Consolidation or Change of Name of
Rights Agent.
(a) Any Person into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be
consolidated, or any Person resulting from any merger or
consolidation to which the Rights Agent or any successor
Rights Agent shall be a party, or any Person succeeding to
the stock transfer or all or substantially all of the
shareholder services 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 hereof. In case, at the time
such successor Rights Agent shall succeed to the agency
created by this Agreement, any of the Right Certificates
shall have been countersigned but not delivered, any such
successor Rights Agent may adopt the countersignature of a
predecessor Rights Agent and deliver such Right Certificates
so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any
successor Rights Agent may countersign such Right
Certificates either in the name of the predecessor or in the
name
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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) In case at any time the name of the Rights Agent
shall be changed and at such time any of the Right
Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver Right Certificates so
countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, the Rights
Agent may countersign such Right Certificates either in its
prior name 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 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations, and only the duties and
obligations, expressly imposed by this Agreement (and no implied
duties and obligations) upon the following terms and conditions,
by all of which the Corporation and the holders of Right
Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel
(who may be legal counsel for the Corporation), and the
advice or opinion of such counsel shall be full and complete
authorization and protection to the Rights Agent with
respect to, and the Rights Agent shall incur no liability
for or in respect of, any action taken, suffered or omitted
by it in good faith and in accordance with such advice or
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 (including without
limitation the identity of an Acquiring Person and the
determination of the current market price of any Security)
be proved or established by the Corporation prior to the
Rights Agent's taking, suffering or omitting to take 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 of the Board,
the Chief Executive Officer, the President, any Vice
President, the Treasurer or the Secretary of the Corporation
and delivered to the Rights Agent; and such certificate
shall be full authorization and protection to the Rights
Agent with respect to, and the Rights Agent shall incur no
liability for or in respect of, any action taken, suffered
or omitted in good faith by it under the provisions of this
Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only
for its own gross negligence, bad faith or willful
misconduct. In no case will the Rights Agent be liable for
special, indirect, punitive, incidental or consequential
loss or damages of any kind whatsoever (including without
limitation lost profits), even if the Rights Agent has been
advised of the possibility of such damages.
(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
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countersignature on such Right Certificates) or be required
to verify the same, but all such statements and recitals are
and shall be deemed to have been made by the Corporation
only.
(e) The Rights Agent shall not be under any liability
or responsibility in respect of the validity of this
Agreement or the execution and delivery hereof (except the
due execution hereof by the Rights Agent) or in respect of
the validity or execution of any Right Certificate (except
its countersignature thereof); nor shall it be responsible
for any breach by the Corporation of any covenant or
condition contained in this Agreement or in any Rights
Certificate; nor shall it be responsible for any change in
the exercisability of the Rights (including without
limitation the Rights becoming null and void pursuant to
Section 7(e) hereof) or any adjustment required under the
provisions of Section 3, 11, 13, 23 or 24 hereof or
responsible for the manner, method or amount of any such
adjustment or the ascertaining of the existence of facts
that would require any such adjustment (except with respect
to the exercise of Rights evidenced by Right Certificates
after actual notice of any such adjustment); nor shall it by
any act hereunder be deemed to make any representation or
warranty as to the authorization or reservation of any
Preferred Shares or Common Shares to be issued pursuant to
this Agreement or any Right Certificate or as to whether any
Preferred Shares or Common Shares will, when issued, be duly
authorized, validly issued, fully paid and non-assessable.
(f) The Corporation 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 of the
Board, the Chief Executive Officer, the President, any Vice
President, the Treasurer or the Secretary of the
Corporation, and to apply to such officers for advice or
instructions in connection with its duties, and shall not be
liable for any action taken, suffered or omitted 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 Corporation 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 Rights Agreement and the date on 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 or
omitted to be taken by the Rights Agent in accordance with a
proposal included in any such application on or after the
date specified in such application (which date shall not be
less than five Business Days after the date any officer of
the Corporation actually receives such application, unless
any such officer shall have consented in writing to an
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 instruction in response to
such application specifying the action to be taken, suffered
or omitted.
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(h) The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or
deal in any of the Rights or other securities of the
Corporation or become pecuniarily interested in any
transaction in which the Corporation may be interested, or
contract with or lend money to the Corporation or otherwise
act as fully and freely as though it were not the Rights
Agent under this Agreement. Nothing herein shall preclude
the Rights Agent from acting in any other capacity for the
Corporation or for any other Person.
(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 to the
Corporation or any other Person resulting from any such act,
default, neglect or misconduct, absent gross negligence, bad
faith or willful misconduct 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 Rights Certificate
surrendered to the Rights Agent for exercise or transfer,
the certificate attached to the form of assignment or form
of election to purchase, as the case may be, has either not
been completed or indicates an affirmative response to
clause 1 or 2 thereof, the Rights Agent shall not take any
further action with respect to such requested exercise or
transfer without first consulting with the Corporation.
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 Corporation and to each transfer agent of the
Common Shares or Preferred Shares by registered or certified
mail, and, following the Distribution Date, to the holders of the
Right Certificates by first-class mail. The Corporation 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, and to each transfer agent of
the Common Shares or Preferred Shares by registered or certified
mail, and, following the Distribution Date, to holders of the
Right Certificates by first-class mail. If the Rights Agent
shall resign or be removed or shall otherwise become incapable of
acting, the Corporation shall appoint a successor to the Rights
Agent. If the Corporation 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 holder of a Right Certificate (who shall, with such notice,
submit his Right Certificate for inspection by the Corporation),
then the registered holder of any Right Certificate may apply to
any court of competent jurisdiction for the appointment of a new
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Rights Agent. Any successor Rights Agent, whether appointed by
the Corporation or by such a court, shall be (a) a Person
organized and doing business under the laws of the United States
or the laws of any state of the United States or the District of
Columbia, in good standing, having an office in the State of New
York, which is authorized under such laws to exercise corporate
trust or stock transfer 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 $50,000,000, or (b) an Affiliate of a Person
described in clause (a) of this sentence. After appointment, the
successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; however, 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 Corporation
shall file notice thereof in writing with the predecessor Rights
Agent and each transfer agent of the Common Shares or Preferred
Shares, and, following the Distribution Date, 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 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 Corporation may, at its option, issue
new Right Certificates evidencing Rights in such form as may be
approved by the Board to reflect any adjustment or change in the
Purchase Price and the number or kind or class of shares or other
securities or property purchasable under the Right Certificates
made in accordance with the provisions of this Agreement.
Section 23. Redemption and Termination.
(a) (i) The Board may, at its option, redeem all but
not less than all the then outstanding Rights at a
redemption price of $.005 per Right, as such amount may
be appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after
the date hereof (such redemption price being
hereinafter referred to as the "Redemption Price"), at
any time prior to the earlier of (A) the occurrence of
a Section 11(a)(ii) Event, or (B) the Final Expiration
Date. The Corporation may, at its option, pay the
Redemption Price either in Common Shares (based on the
"current per share market price," as defined in
Section 11(d) hereof, of the Common Shares at the time
of redemption) or cash; provided, that if the
Corporation elects to pay the Redemption Price in
Common Shares, the Corporation shall not be required to
issue any fractional Common Shares and the number of
Common Shares issuable to each holder of Rights shall
be rounded down to the next whole share.
(ii) In addition, the Board may, at its option, at any
time following the occurrence of a Section 11(a)(ii)
Event and the expiration of any period during which
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the holder of Rights may exercise the rights under
Section 11(a)(ii) but prior to any Section 13 Event,
redeem all but not less than all of the then
outstanding Rights at the Redemption Price (A) in
connection with any merger, consolidation, combination,
sale or other transfer (in one transaction or in a
series of related transactions) of assets or earning
power aggregating 50 percent or more of the earning
power of the Corporation and its Subsidiaries (taken as
a whole) in which all holders of Common Shares are
treated alike and not involving (other than as a holder
of Common Shares being treated like all other such
holders) an Interested Stockholder, or (B)(1) if and
for so long as the Acquiring Person is not thereafter
the Beneficial Owner of 10 percent or more of the Common
Shares, and (2) at the time of redemption no other
Persons are Acquiring Persons.
(b) In the case of a redemption permitted under
Section 23(a)(i) hereof, immediately upon the date for
redemption set forth (or determined in the manner specified)
in a resolution of the Board ordering the redemption of the
Rights, evidence of which shall have been filed with the
Rights Agent, and without any further action and without any
notice, the right to exercise the Rights will terminate and
the only right thereafter of the holders of Rights shall be
to receive the Redemption Price for each Right so held. In
the case of a redemption permitted only under
Section 23(a)(ii) hereof, evidence of which shall have been
filed with the Rights Agent, the right to exercise the
Rights will terminate and represent only the right to
receive the Redemption Price upon the later of 10 Business
Days following the giving of such notice or the expiration
of any period during which the rights under
Section 11(a)(ii) hereof may be exercised. The Corporation
shall promptly give public notice of any such redemption to
the Rights Agent and the holders of the Rights in the manner
set forth in Section 26 hereof; 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 such date for redemption set forth in a resolution of
the Board ordering the redemption of the Rights, the
Corporation shall mail a notice of redemption to all the
holders of the then outstanding Rights at their last
addresses as they appear upon the registry books of the
Rights Agent or, prior to the Distribution Date, on the
registry books of the transfer agent for the Common 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 will state the
method by which the payment of the Redemption Price will be
made. Neither the Corporation nor any of its Affiliates or
Associates may redeem, acquire or purchase for value any
Rights at any time in any manner other than that
specifically set forth in this Section 23 or in Section 24
hereof and other than in connection with the purchase of
Common Shares prior to the Distribution Date.
(c) The Corporation may, at its option, discharge all
of its obligations with respect to the Rights by (i) issuing
a press release announcing the manner of redemption of the
Rights in accordance with this Agreement and (ii) mailing
payment of the Redemption Price to the registered holders of
the Rights at their last addresses as they appear on the
registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books
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of the transfer agent of the Common Shares, and, upon such
action, all outstanding Rights and Right Certificates shall
be null and void without any further action by the
Corporation.
Section 24. Exchange.
(a) The Board may, at its option, at any time after
any Person becomes an Acquiring Person, exchange 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) or 11(a)(ii) hereof) for
Common Shares of the Corporation at an exchange ratio of one
Common Share per Right, appropriately adjusted to reflect
any stock split, stock dividend or similar transaction
occurring after the date hereof (such exchange ratio being
hereinafter referred to as the "Exchange Ratio").
Notwithstanding the foregoing, the Board shall not be
empowered to effect such exchange at any time after any
Person (other than the Corporation, any Subsidiary of the
Corporation, any employee benefit plan of the Corporation or
any such Subsidiary, any Person organized, appointed or
established by the Corporation for or pursuant to the terms
of any such plan or any trustee, administrator or fiduciary
of such a plan), together with all Affiliates and Associates
of such Person, becomes the Beneficial Owner of 50 percent or
more of the Common Shares then outstanding.
(b) Immediately upon the action of the Board ordering
the exchange of any Rights pursuant to Section 24(a) hereof
and without any further action and without any notice, the
right to exercise such Rights shall terminate and the only
right thereafter of the holders of such Rights shall be to
receive that number of Common Shares equal to the number of
such Rights held by such holder multiplied by the Exchange
Ratio. The Corporation shall promptly give public notice
and notice to the Rights Agent of any such exchange;
provided, however, that the failure to give, or any defect
in, such notice shall not affect the validity of such
exchange. The Corporation shall promptly mail a notice of
any such exchange to the Rights Agent and to all of the
holders of such Rights at their last addresses as they
appear upon the registry books of the Rights Agent. Any
notice which is mailed in the manner herein provided shall
be deemed given, whether or not the holder receives the
notice. Each such notice of exchange will state the method
by which the exchange of the Common Shares for Rights will
be effected and, in the event of any partial exchange, the
number of Rights which will be exchanged. Any partial
exchange shall be effected pro rata based on the number of
Rights (other than Rights which have become void pursuant to
the provisions of Section 7(e) or 11(a)(ii) hereof) held by
each holder of Rights.
(c) In any exchange pursuant to this Section 24, the
Corporation, at its option, may substitute Preferred Shares
(or equivalent preferred shares, as such term is defined in
Section 11(b) hereof) for some or all of the Common Shares
exchangeable for Rights, at the initial rate of one
one-thousandth of a Preferred Share (or equivalent preferred
share) for each Common Share, as appropriately adjusted to
reflect adjustments in the voting rights of the Preferred
Shares pursuant to the terms thereof, so that the fraction
of a Preferred Share
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delivered in lieu of each Common Share shall have the same
dividend, liquidation and voting rights as one Common Share.
(d) In the event that there shall not be sufficient
Common Shares or Preferred Shares issued but not outstanding
or authorized but unissued to permit any exchange of Rights
as contemplated in accordance with this Section 24, the
Corporation shall take all such action as may be necessary
to authorize additional Common Shares or Preferred Shares
for issuance upon exchange of the Rights.
Section 25. Notice of Certain Events.
(a) In case the Corporation shall, at any time after
the Distribution Date, propose (i) to pay any dividend
payable in stock of any class to the holders of its
Preferred Shares or to make any other distribution to the
holders of its Preferred Shares (other than a regularly
quarterly cash dividend), (ii) to offer to the holders of
its Preferred Shares rights or warrants to subscribe for or
to purchase any additional Preferred Shares or shares of
stock of any class or any other securities, rights or
options, (iii) to effect any reclassification of its
Preferred Shares (other than a reclassification involving
only the subdivision or combination of outstanding Preferred
Shares), (iv) to effect any consolidation or merger into or
with any other Person (other than a Subsidiary of the
Corporation in a transaction which does not violate
Section 11(n) hereof), 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 50 percent or more of the assets or earning
power of the Corporation and its Subsidiaries (taken as a
whole) to any other Person or Persons (other than the
Corporation and/or any of its Subsidiaries in one or more
transactions each of which does not violate Section 11(n)
hereof), or (v) to effect the liquidation, dissolution or
winding up of the Corporation, then, in each such case, the
Corporation shall give to each holder of a Right
Certificate, in accordance with Section 26 hereof, a notice
of such proposed action and shall file a certificate with
the Rights Agent to that effect, which shall specify the
record date for the purposes of such dividend, distribution
or offering of rights or warrants, or the date on which such
reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution, or winding up is to take place and
the date of participation therein by the holders of the
Preferred Shares, if any such date is to be fixed, and such
notice shall be so given in the case of any action covered
by clause (i) or (ii) above at least 20 days prior to the
record date for determining holders of the Preferred 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 Preferred Shares, whichever
shall be the earlier. The failure to give notice required
by this Section 25 or any defect therein shall not affect
the legality or validity of the action taken by the
Corporation or the vote upon any such action.
(b) Notwithstanding anything in this Agreement to the
contrary, prior to the Distribution Date, a public filing by
the Corporation with the U.S. Securities and Exchange
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Commission shall constitute sufficient notice to the holders
of securities of the Corporation, including without
limitation the Rights, for purposes of this Agreement and no
other notice need be given to such holders.
(c) In case of a Section 11(a)(ii) Event, then (i) the
Corporation shall, as soon as practicable thereafter, give
to each holder of a Right Certificate, in accordance with
Section 26 hereof, a notice of the occurrence of such event,
which notice shall describe such event and the consequences
of such event to holders of Rights under Section 11(a)(ii)
hereof, and (ii) all references in Section 25(a) hereof to
Preferred Shares shall be deemed thereafter to refer also to
Common Shares and/or, if appropriate, other securities of
the Corporation.
Section 26. Notices. Notices or demands authorized by
this Agreement to be given or made by the Rights Agent or by the
holder of any Right Certificate to or on the Corporation shall be
sufficiently given or made if sent by first-class mail, postage
prepaid, addressed as follows (or to such other address or
addresses as the Corporation shall specify in writing to the
Rights Agent):
Willbros Group, Inc.
Dresdner Bank Building
50th Street, 8th Floor
P.O. Box 850048
Panama 5, Republic of Panama
with a copy to:
Willbros Group, Inc.
c/o Willbros USA, Inc.
2431 E. 61st Street, Suite 700
Tulsa, Oklahoma 74136
Attention: General Counsel
Subject to the provisions of Section 21 hereof, any notice or
demand authorized by this Agreement to be given or made by the
Corporation 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 as follows (or to
such other address or addresses as the Rights Agent shall specify
in writing to the Corporation):
ChaseMellon Shareholder Services, L.L.C.
2323 Bryan Street, Suite 2300
Dallas, Texas 75201
Attention: Tim L. Regan
Notices or demands authorized by this Agreement to be given or
made by the Corporation or the Rights Agent to the holder of any
Right Certificate or, if prior to the Distribution Date, to the
holder
36
<PAGE>
of certificates representing Common Shares shall be sufficiently
given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown
on the registry books of the Corporation.
Section 27. Supplements and Amendments. Prior to the
Distribution Date, the Corporation and the Rights Agent shall, if
the Corporation so directs, supplement or amend any provision of
this Agreement without the approval of any holders of
certificates representing Common Shares. From and after the
Distribution Date, the Corporation and the Rights Agent shall, if
the Corporation so directs, supplement or amend this Agreement
without the approval of any holders of Right Certificates in
order (a) to cure any ambiguity, (b) to correct or supplement any
provision contained herein which may be defective or inconsistent
with any other provisions herein, (c) to shorten or lengthen any
time period hereunder, or (d) to change or supplement the
provisions hereof in any manner which the Corporation may deem
necessary or desirable and which shall not adversely affect the
interests of the holders of Right Certificates (other than an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person); provided, however, that this Agreement may not be
supplemented or amended to lengthen, pursuant to clause (c) of
this sentence, (i) a time period relating to when the Rights may
be redeemed at such time as the Rights are not then redeemable,
or (ii) any other time period unless such lengthening is for the
purpose of protecting, enhancing or clarifying the rights of,
and/or the benefits to, the holders of Rights. Upon the delivery
of a certificate from an appropriate officer of the Corporation
which states that the proposed supplement or amendment is in
compliance with the terms of this Section 27, the Rights Agent
shall execute such supplement or amendment, provided that such
supplement or amendment does not adversely affect the rights or
obligations of the Rights Agent under this Agreement. Prior to
the Distribution Date, the interests of the holders of Rights
shall be deemed coincident with the interests of the holders of
Common Shares.
Section 28. Determination and Actions by the Board, etc.
The Board shall have the exclusive power and authority to
administer this Agreement and to exercise all rights and powers
specifically granted to the Board or the Corporation, or as may
be necessary or advisable in the administration of this
Agreement, including without limitation the right and power to
(a) interpret the provisions of this Agreement, and (b) make all
determinations deemed necessary or advisable for the
administration of this Agreement (including without limitation a
determination to redeem or exchange or not to redeem or exchange
the Rights or to amend this Agreement and whether any proposed
amendment adversely affects the interests of the holders of Right
Certificates). For all purposes of this Agreement, any
calculation of the number of Common Shares or other securities
outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding Common
Shares or any other securities 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 as in effect on the date of
this Agreement. All such actions, calculations, interpretations
and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing) which are done or
made by the Board in good faith (the Rights Agent may assume the
Board acted in good faith), shall (x) be final, conclusive and
binding
37
<PAGE>
on the Corporation, the Rights Agent, the holders of the Right
Certificates and all other Persons, and (y) not subject the Board
to any liability to the holders of the Right Certificates.
Section 29. Successors. All the covenants and provisions
of this Agreement by or for the benefit of the Corporation or the
Rights Agent shall bind and inure to the benefit of their
respective successors and assigns hereunder.
Section 30. Benefits of this Agreement. Nothing in this
Agreement shall be construed to give to any Person other than the
Corporation, the Rights Agent and the registered holders of the
Right Certificates (and, prior to the Distribution Date, the
Common Shares) any legal or equitable right, remedy or claim
under this Agreement; but this Agreement shall be for the sole
and exclusive benefit of the Corporation, the Rights Agent and
the registered holders of the Right Certificates (and, prior to
the Distribution Date, the Common Shares).
Section 31. Severability. If any term, provision,
covenant or restriction of this Agreement is held by a court of
competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants
and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
Section 32. Governing Law. This Agreement, each Right
and each Right Certificate issued hereunder shall be deemed to be
a contract made under the laws of the Republic of Panama and for
all purposes shall be governed by and construed in accordance
with the laws of such country applicable to contracts made and to
be performed entirely within such country, except that all
provisions regarding the rights, duties and obligations of the
Rights Agent shall be governed by and construed in accordance
with the law of the State of New York, U.S.A., applicable to
contracts made and to be performed entirely within such State.
Section 33. Counterparts. This Agreement may be executed
in any number of counterparts, each of such counterparts shall
for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same
instrument.
Section 34. Descriptive Headings. Descriptive headings
of the several Sections of this Agreement are inserted for
convenience of reference only and shall not control or affect the
meaning or construction of any of the provisions hereof.
38
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed by their respective authorized officers, all
as of the day and year first above written.
WILLBROS GROUP, INC.
By: /s/ Melvin F. Spreitzer
-------------------------------
Name: Melvin F. Spreitzer
Title: Executive Vice President
CHASEMELLON SHAREHOLDER
SERVICES, L.L.C.
By: /s/ Tim L. Reagan
-------------------------------
Name: Tim L. Reagan
Title: Relationship Manager
39
<PAGE>
Exhibit A
Form of
Certificate of Designation
of
Series A Junior Participating Preferred Stock
of
Willbros Group, Inc.
(Pursuant to the Laws of the Republic of Panama)
The undersigned, Melvin F. Spreitzer, Executive Vice
President, and John N. Hove, Corporate Secretary, of Willbros
Group, Inc., a corporation organized and existing under the laws
of the Republic of Panama (hereinafter called the "Corporation"),
in accordance with the provisions thereof, DO HEREBY CERTIFY:
That, pursuant to the authority conferred upon the Board of
Directors of the Corporation (hereinafter called the "Board of
Directors ") by the Articles of Incorporation of the Corporation,
the Board of Directors on April 1, 1999, adopted the following
resolution authorizing a series of Class A Preferred Stock in the
amount and having the designation, voting powers, preferences and
relative, participating, optional and other special rights and
qualifications, limitations and restrictions thereof as follows:
RESOLVED, that, pursuant to the authority conferred
upon the Board of Directors in accordance with the
provisions of the Corporation's Articles of Incorporation,
the Board of Directors hereby authorizes a series of Class A
Preferred Stock of the Corporation, with a par value of $.01
per share, and hereby states the designation and number of
shares, and fixes the relative rights, preferences, voting
powers, qualifications, limitations and restrictions thereof
(in addition to the provisions set forth in the
Corporation's Articles of Incorporation which are applicable
to the Preferred Stock or the Class A Preferred Stock of all
classes and series) as follows:
Series A Junior Participating Preferred Stock
Section 1. Designation, Par Value and Amount. The
shares of such series shall be designated as "Series A Junior
Participating Preferred Stock" (hereinafter referred to as
"Series A Preferred Stock"), the shares of such series shall be
with par value of $.01 per share, and the number of shares
constituting such series shall be 35,000; provided, however,
that, if more than a total of 35,000 shares of Series A Preferred
Stock shall be issuable upon the exercise of Rights (the
"Rights") issued pursuant to the Rights Agreement, dated as of
April 1, 1999, between the Corporation and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent (as amended from
time to time) (the "Rights Agreement"), the Board of Directors,
pursuant to the laws of the Republic of Panama, shall direct by
resolution or resolutions that a certificate be properly
executed, acknowledged and filed
A-1
<PAGE>
providing for the total number of shares of Series A Preferred
Stock authorized to be issued to be increased (to the extent that
the Corporation's Articles of Incorporation then permits) to the
largest number of whole shares (rounded up to the nearest whole
number) issuable upon exercise of the Rights. Such number of
shares of the Series A Preferred Stock 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
Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares issuable upon exercise or
conversion of outstanding rights, options or other securities
issued by the Corporation.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the
holders of any shares of any series of Preferred Stock or
Class A Preferred Stock ranking prior and superior to the
shares of Series A Preferred Stock with respect to
dividends, the holders of shares of Series A Preferred
Stock, in preference to the holders of shares of any class
or series of stock of the Corporation ranking junior to the
Series A Preferred Stock in respect thereof, 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 first business
day of January, April, July and October of each year (each
such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction
of a share of Series A Preferred Stock, in an amount per
share (rounded to the nearest cent) equal to the greater of
(a) $10.00 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, par value $.05 per share, of the
Corporation (the "Common Stock") or a subdivision of the
outstanding shares of Common Stock, by reclassification or
otherwise), declared on the Common Stock since the
immediately preceding Quarterly Dividend Payment Date or,
with respect to the first Quarterly Dividend Payment Date,
since the first issuance of any share or fraction of a share
of Series A Preferred Stock. In the event the Corporation
shall at any time after the record date for the initial
distribution of the Rights pursuant to the Rights Agreement
(the "Rights Declaration Date") (i) declare or pay any
dividend on the Common Stock payable in shares of Common
Stock, (ii) subdivide the outstanding Common Stock, or
(iii) combine the outstanding Common Stock into a smaller
number of shares, then, in each such case, the amount to
which holders of shares of Series A Preferred Stock were
entitled immediately prior to such event under clause (b) of
the preceding sentence shall be adjusted by multiplying such
amount by a fraction, the numerator of which is the number
of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares
of Common Stock that were outstanding immediately prior to
such event.
(B) The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in paragraph (A) of this
Section 2 immediately after it declares
A-2
<PAGE>
a dividend or distribution on the Common Stock (other than a
dividend payable in shares of Common Stock or a subdivision
of the outstanding shares of Common Stock); provided, that,
in the event no dividend or distribution shall have been
declared on the Common Stock during the period between any
Quarterly Dividend Payment Date and the next subsequent
Quarterly Dividend Payment Date (or, with respect to the
first Quarterly Dividend Payment Date, the period between
the first issuance of any share or fraction of a share of
Series A Preferred Stock and such first Quarterly Dividend
Payment Date), a dividend of $10.00 per share on the
Series A Preferred Stock shall nevertheless be payable on
such subsequent Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative
on outstanding shares of Series A Preferred Stock from the
Quarterly Dividend Payment Date next preceding the date of
issue of such shares of Series A Preferred Stock, unless the
date of issue of such shares is prior to the record date for
the first Quarterly Dividend Payment Date, in which case
dividends on such shares shall begin to accrue and be
cumulative from the date of issue of such shares, or unless
the date of issue is a date after the record date for the
determination of holders of shares of Series A Preferred
Stock entitled to receive a quarterly dividend and on or
before such Quarterly Dividend Payment Date, in which case
dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the
shares of Series A Preferred Stock in an amount less than
the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date
for the determination of holders of shares of Series A
Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be
not more than 60 days prior to the date fixed for the
payment thereof.
Section 3. Voting Rights. In addition to any other
voting rights required by law, the holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Except as provided in paragraph (C) of this
Section 3 and subject to the provision for adjustment
hereinafter set forth, each share of Series A 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 or pay
any dividend on the Common Stock payable in shares of Common
Stock, (ii) subdivide the outstanding Common Stock, or
(iii) combine the outstanding Common Stock into a smaller
number of shares, then in each such case the number of votes
per share to which holders of shares of Series A Preferred
Stock were entitled immediately prior to such event shall be
adjusted by multiplying such number by a fraction, the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator
of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
A-3
<PAGE>
(B) Except as otherwise provided herein or by law, the
holders of shares of Series A Preferred Stock and the
holders of shares of Common Stock shall vote together as one
class on all matters submitted to a vote of stockholders of
the Corporation.
(C) (i) If, on the date used to determine
stockholders of record for any meeting of stockholders for
the election of directors, a default in preference dividends
(as defined in subparagraph (v) below) on the Series A
Preferred Stock shall exist, the holders of the Series A
Preferred Stock shall have the right, voting as a class as
described in subparagraph (ii) below, to elect two directors
(in addition to the directors elected by holders of Common
Stock). Such right may be exercised (a) at any meeting of
stockholders for the election of directors or (b) at a
meeting of the holders of shares of Voting Preferred Stock
(as hereinafter defined), called for the purpose in
accordance with the By-laws of the Corporation, until all
such cumulative dividends (referred to above) shall have
been paid in full or until non-cumulative dividends have
been paid regularly for at least one year.
(ii) The right of the holders of Series A
Preferred Stock to elect two directors, as described above,
shall be exercised as a class concurrently with the rights
of holders of any other series of Preferred Stock or Class A
Preferred Stock upon which voting rights to elect such
directors have been conferred and are then exercisable. The
Series A Preferred Stock and any additional series of
Preferred Stock or Class A Preferred Stock which the
Corporation may issue and which may provide for the right to
vote with the Series A Preferred Stock are collectively
referred to herein as "Voting Preferred Stock."
(iii) Each director elected by the holders of
shares of Voting Preferred Stock shall be referred to herein
as a "Preferred Director." A Preferred Director so elected
shall continue to serve as such director for a term of one
year, except that upon any termination of the right of all
of such holders to vote as a class for Preferred Directors,
the term of office of the Preferred Directors shall
terminate. Any Preferred Director may be removed by, and
shall not be removed except by, the vote of the holders of
record of a majority of the outstanding shares of Voting
Preferred Stock then entitled to vote for the election of
directors, present (in person or by proxy) and voting
together as a single class (a) at a meeting of the
stockholders, or (b) at a meeting of the holders of shares
of such Voting Preferred Stock, called for the purpose in
accordance with the By-laws of the Corporation, or (c) by
written consent signed by the holders of a majority of the
then outstanding shares of Voting Preferred Stock then
entitled to vote for the election of directors, taken
together as a single class.
(iv) So long as a default in any preference
dividends on the Series A Preferred Stock shall exist or the
holders of any other series of Voting Preferred Stock shall
be entitled to elect Preferred Directors, (a) any vacancy in
the office of a Preferred Director may be filled (except as
provided in the following clause (b)) by an instrument in
writing signed by the remaining Preferred Director and filed
with the Corporation and (b) in the case of the removal of
any Preferred Director, the vacancy may be filled by the
vote or written
A-4
<PAGE>
consent of the holders of a majority of the outstanding
shares of Voting Preferred Stock then entitled to vote for
the election of directors, present (in person or by proxy)
and voting together as a single class, at such time as the
removal shall be effected. Each director appointed as
aforesaid by the remaining Preferred Director shall be
deemed, for all purposes hereof, to be a Preferred Director.
Whenever (x) no default in preference dividends on the
Series A Preferred Stock shall exist and (y) the holders of
other series of Voting Preferred Stock shall no longer be
entitled to elect such Preferred Directors, then the number
of directors constituting the Board of Directors of the
Corporation shall be reduced by two.
(v) For purposes hereof, a "default in preference
dividends" on the Series A Preferred Stock shall be deemed
to have occurred whenever the amount of cumulative and
unpaid dividends on the Series A Preferred Stock shall be
equivalent to six full quarterly dividends or more (whether
or not consecutive), and, having so occurred, such default
shall be deemed to exist thereafter until, but only until,
all cumulative dividends on all shares of the Series A
Preferred Stock then outstanding shall have been paid
through the last Quarterly Dividend Payment Date or until,
but only until, non-cumulative dividends have been paid
regularly for at least one year.
(D) Except as set forth herein (or as otherwise
required by applicable law), holders of Series A Preferred
Stock shall have no general or special voting rights and
their consent shall not be required for taking any corporate
action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as
provided in Section 2 above are in arrears, thereafter and
until all accrued and unpaid dividends and distributions,
whether or not declared, on shares of Series A Preferred
Stock outstanding shall have been paid in full, the
Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding
up) to the Series A Preferred Stock;
(ii) declare or pay dividends, 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 Preferred Stock, except
dividends paid ratably on the Series A 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
value any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to
the Series A Preferred Stock; provided, that the Corporation
may at any time redeem, purchase
A-5
<PAGE>
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 Preferred
Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock, or any
shares of stock ranking on a parity (either as to dividends
or upon liquidation, dissolution or winding up) with the
Series A Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of such
shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and
other relative rights and preferences of the respective
series and classes, shall determine in good faith will
result in fair and equitable treatment among the respective
series or classes.
(B) The Corporation shall not permit any subsidiary of
the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the Corporation unless
the Corporation could, under paragraph (A) of this
Section 4, purchase or otherwise acquire such shares at such
time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A
Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired and
cancelled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but
unissued shares of Class A Preferred Stock and may be reissued as
part of another series of Class A Preferred Stock subject to the
conditions and restrictions on issuance set forth herein, in the
Articles of Incorporation of the Corporation, in any other
Certificate of Designation creating a series of Class A Preferred
Stock or as otherwise required or permitted by law.
Section 6. Liquidation, Dissolution or Winding Up.
(A) Subject to the prior and superior rights of holders of any
shares of any series of Preferred Stock or Class A Preferred
Stock ranking prior and superior to the shares of Series A
Preferred Stock with respect to rights upon liquidation,
dissolution or winding up (voluntary or otherwise), upon any
liquidation, dissolution or winding up of the Corporation
(voluntary or otherwise), no distribution shall be made to the
holders of shares of stock ranking junior (either as to dividends
or upon liquidation, dissolution or winding up) to the Series A
Preferred Stock unless, prior thereto, the holders of shares of
Series A Preferred Stock shall have received $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 Preferred Stock unless, prior
thereto, the holders of shares of Common Stock shall have
received an amount per share (the "Capital 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 paragraph (C) of this Section 6) (such number in
A-6
<PAGE>
clause (ii) being hereinafter referred to as the "Adjustment
Number"). Following the payment of the full amount of the
Series A Liquidation Preference and the Capital Adjustment
in respect of all outstanding shares of Series A Preferred
Stock and Common Stock, respectively, holders of Series A
Preferred Stock and holders of Common Stock shall receive
their ratable and proportionate share of the remaining
assets to be distributed in the ratio of the Adjustment
Number to 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 and Class
A Preferred Stock, if any, which rank on a parity with the
Series A Preferred Stock, then such remaining assets shall
be distributed ratably to the holders of Series A Preferred
Stock and the holders of such parity shares in proportion to
their respective liquidation preferences. In the event,
however, that there are not sufficient assets available to
permit payment in full of the Capital 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 or pay any
dividend on the Common Stock payable in shares of Common
Stock, (ii) subdivide the outstanding Common Stock, or
(iii) combine the outstanding Common Stock into a smaller
number of shares, then in each such case the Adjustment
Number in effect immediately prior to such event shall be
adjusted by multiplying such Adjustment Number by a
fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
Section 7. Consolidation, Merger, Combination, etc. In
case the Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common
Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case
the shares of Series A Preferred Stock shall at the same time be
similarly exchanged or changed in an amount per share (subject to
the provision for adjustment hereinafter set forth) equal to
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 or pay any dividend on
the 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
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.
A-7
<PAGE>
Section 8. No Redemption. The shares of Series A
Preferred Stock shall not be redeemable.
Section 9. Ranking. The Series A Preferred Stock shall
rank junior to all other series of the Corporation's Preferred
Stock and Class A Preferred Stock as to the payment of dividends
and the distribution of assets, unless the terms of any such
series shall provide otherwise.
Section 10. Amendment. At any time that any shares of
Series A Preferred Stock are outstanding, the Articles of
Incorporation of the Corporation shall not be amended in any
manner which would materially alter or change the powers,
preferences or special rights of the Series A Preferred Stock so
as to affect them adversely without the affirmative vote of the
holders of a majority or more of the outstanding shares of
Series A Preferred Stock, voting separately as a class.
Section 11. Fractional Shares. Series A Preferred Stock
may be issued in fractions of a share which shall entitle the
holder, in proportion to such holder's fractional shares, to
exercise voting rights, to receive dividends, to participate in
distributions and to have the benefit of all other rights of
holders of Series A Preferred Stock.
IN WITNESS WHEREOF, this Certificate of Designation is
executed on behalf of the Corporation by its duly authorized
officers this day of April, 1999.
-----
WILLBROS GROUP, INC.
By:
------------------------------
Melvin F. Spreitzer
Executive Vice President
ATTEST:
- -------------------------
John N. Hove
Corporate Secretary
A-8
<PAGE>
Exhibit B
Form of Right Certificate
Certificate
No. R- Rights
-----
NOT EXERCISABLE AFTER THE EARLIER OF APRIL 15, 2009, AND THE DATE
ON WHICH THE RIGHTS EVIDENCED HEREBY ARE REDEEMED OR EXCHANGED AS
SET FORTH IN THE RIGHTS AGREEMENT. THE RIGHTS ARE SUBJECT TO
REDEMPTION AT $.005 PER RIGHT AND TO EXCHANGE ON THE TERMS SET
FORTH IN THE RIGHTS AGREEMENT. AS SET FORTH IN THE RIGHTS
AGREEMENT, RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO IS, WAS
OR BECOMES AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE
THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT),
WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR BY ANY
SUBSEQUENT HOLDER, ARE NULL AND VOID. [THE RIGHTS REPRESENTED BY
THIS RIGHT CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON
WHO WAS OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR
ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN
THE RIGHTS AGREEMENT). ACCORDINGLY, THIS RIGHT CERTIFICATE AND
THE RIGHTS REPRESENTED HEREBY ARE NULL AND VOID.]*
Right Certificate
WILLBROS GROUP, INC.
This Right Certificate 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 April 1, 1999, between Willbros Group,
Inc., a Republic of Panama corporation (the "Corporation"), and
ChaseMellon Shareholder Services, L.L.C. (the "Rights Agent"), as
the same may be amended from time to time (the "Rights
Agreement"), to purchase from the Corporation at any time after
the Distribution Date (as such term is defined in the Rights
Agreement) and prior to 5:00 P.M., Dallas, Texas, time, on
April 15, 2009, at the office of the Rights Agent designated for
such purpose, or at the office of its successor as Rights Agent,
one one-thousandth of a fully paid, non-assessable share of
Series A Junior Participating Preferred Stock, with a par value
of $.01 per share (the "Preferred Shares"), of the Corporation,
at a purchase price of $30.00 per one one-thousandth of a
Preferred Share (the "Purchase Price"), payable in lawful money
of the United States of America, upon presentation and surrender
of this Right Certificate with the Form of Election to Purchase
duly executed.
- ------------------
* If applicable, insert this portion of the legend and delete the
preceding sentence.
B-1
<PAGE>
The number of Rights evidenced by this Right Certificate
(and the number of one one-thousandths of a Preferred Share 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 April 15, 1999, based on the Preferred Shares as
constituted at such date and may have been or in the future be
adjusted as a result of the occurrence of certain events, as more
fully provided in the Rights Agreement.
Upon the occurrence of a Section 11(a)(ii) Event (as such
term is defined in the Rights Agreement), if the Rights evidenced
by this Right Certificate are beneficially owned by (i) an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person (as such terms are defined in the Rights Agreement),
(ii) a transferee of an Acquiring Person or any such Associate or
Affiliate who becomes a transferee after the Acquiring Person
becomes such, or (iii) under certain circumstances specified in
the Rights Agreement, a transferee of an Acquiring Person or any
such Associate or Affiliate who becomes a transferee prior to or
concurrently with the Acquiring Person becoming such, such Rights
shall become null and void and no holder hereof shall have any
right with respect to such Rights from and after the occurrence
of such Section 11(a)(ii) Event.
As provided in the Rights Agreement, the Purchase Price and
the number of one one-thousandth of a Preferred Share or other
securities 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, including
Triggering Events (as such term is defined in the Rights
Agreement).
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 Corporation and the holders of
the Right Certificates, which limitations of rights include the
temporary suspension of the exercisability of such Rights under
the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the principal
executive offices of the Corporation and the office of the Rights
Agent designated for such purpose.
This Right Certificate, with or without other Right
Certificates, upon surrender at the office of the Rights Agent
designated for such purpose, 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 Preferred Shares or other securities 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
Corporation at a redemption price of $.005 per Right (subject to
adjustment as provided in the Rights Agreement) payable either in
cash or the Corporation's
B-2
<PAGE>
Common Shares, par value $.05 per share, or (ii) may be exchanged
in whole or in part for Common Shares or Preferred Shares.
No fractional Preferred Shares or Common Shares will be
issued upon the exercise or exchange of any Right or Rights
evidenced hereby (other than fractions of Preferred Shares which
are one one-thousandth or integral multiples of one
one-thousandth of a Preferred Share, which may, at the election
of the Corporation, be evidenced by depositary receipts), 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 other distributions or be deemed for
any purpose the holder of the Preferred Shares or of any other
securities of the Corporation which may at any time be issuable
on the exercise or exchange hereof, nor shall anything contained
in the Rights Agreement or herein be construed to confer upon the
holder hereof, as such, any of the rights of a stockholder of the
Corporation or any right to vote for the election of directors or
upon any matter submitted to stockholders 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 other distributions or to exercise any
preemptive or subscription rights, or otherwise, until the Right
or Rights evidenced by this Right Certificate shall have been
exercised or exchanged as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Rights
Agent.
WITNESS the facsimile signature of the proper officers of
the Corporation and its corporate seal. Dated as
of , .
----------------- --------
ATTEST: WILLBROS GROUP, INC.
By:
- --------------------------------- -------------------------------
Name: Name:
Title: Title:
Countersigned:
CHASEMELLON SHAREHOLDER
SERVICES, L.L.C., as Rights Agent
By:
-----------------------------
Authorized Signatory
Name:
Title:
B-3
<PAGE>
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)
Rights represented by this Right Certificate,
- ---------------
together with all right, title and interest therein, and does
hereby irrevocably constitute and appoint
-----------------------
Attorney, to transfer said Rights on the books of the within-
named Corporation, with full power of substitution.
Dated:
--------------------
------------------------------
Signature
Signature Guaranteed:
Signatures must be guaranteed by a bank, trust company,
broker, dealer or other eligible institution participating in a
recognized signature guarantee medallion program.
- ----------------------------------------------------------------------------
CERTIFICATE
The undersigned hereby certifies, by checking the
appropriate boxes and signing below, that:
(1) The Rights evidenced by this Right Certificate are
------
are not being sold, assigned or transferred by or on
------
behalf of a Person who is or was an Acquiring Person or an
Affiliate or Associate thereof (as such terms are defined in
the Right Agreement); and
(2) After due inquiry and to the best knowledge of the
undersigned, the undersigned did did not
------- -------
acquire the Rights evidenced by this Right Certificate from
any Person who is or was an Acquiring Person or an Affiliate
or Associate thereof (as such terms are defined in the
Rights Agreement).
Dated:
--------------------- -------------------------------------
Signature
B-4
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed by the registered holder
if such holder desires to exercise Rights
represented by the Right Certificate.)
To WILLBROS GROUP, INC.:
The undersigned hereby irrevocably elects to exercise
Rights represented by this Right Certificate to
purchase the Preferred Shares, Common Shares or other securities
issuable upon the exercise of such Rights and requests that
certificates for such Preferred Shares, Common Shares or other
securities be issued in the name of and delivered to:
Please insert social security
or other identifying number
---------------------------
- ------------
- -----------------------------------------------------------------
- -----------------
(Please print name and address)
- -----------------------------------------------------------------
- -----------------
If such number of Rights shall not be all the Rights evidenced by
this 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:
------------------------------------
------------------------------
- -----------------
Signature
B-5
<PAGE>
Signature Guaranteed:
Signatures must be guaranteed by a bank, trust company,
broker, dealer or other eligible institution participating in a
recognized signature guarantee medallion program.
- ----------------------------------------------------------------------------
CERTIFICATE
The undersigned hereby certifies, by checking the
appropriate boxes and signing below, that:
(1) The Rights evidenced by this Right Certificate are
-------
are not being exercised by or on behalf of a Person
------
who is or was an Acquiring Person or an Affiliate or
Associate thereof (as such terms are defined in the Rights
Agreement); and
(2) After due inquiry and to the best knowledge of the
undersigned, the undersigned did did not
------- -------
acquire the Rights evidenced by this Rights Certificate from
any Person who is or was an Acquiring Person or an Affiliate
or Associate thereof (as such terms are defined in the
Rights Agreement).
Dated:
--------------------- --------------------------------------
Signature
NOTICE
The signature on the foregoing Forms of Assignment and
Election to Purchase and certificates 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 Corporation 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 such terms are defined in the Rights
Agreement) and such Assignment or Election to Purchase will not
be honored.
B-6
<PAGE>
Exhibit C
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES OF
WILLBROS GROUP, INC.
On April 1, 1999, the Board of Directors of Willbros Group,
Inc. (the "Corporation") declared a distribution of one preferred
share purchase right (a "Right") for each outstanding share of
Common Stock, par value $.05 per share (the "Common Shares"), of
the Corporation. The distribution is payable to the stockholders
of record of the Corporation on April 15, 1999 (the "Record
Date"), and with respect to Common Shares issued thereafter until
the Distribution Date (as defined below) and, in certain
circumstances, with respect to Common Shares issued after the
Distribution Date. Except as set forth below, each Right, when
it becomes exercisable, entitles the registered holder to
purchase from the Corporation one one-thousandth of a share of
Series A Junior Participating Preferred Stock, with a par value
of $.01 per share, of the Corporation (the "Preferred Shares") at
a price of $30.00 per one one-thousandth of a Preferred Share
(the "Purchase Price"), subject to adjustment. The description
and terms of the Rights are set forth in a Rights Agreement, as
the same may be amended from time to time (the "Rights
Agreement"), between the Corporation and ChaseMellon Shareholder
Services, L.L.C., as Rights Agent, dated as of April 1, 1999.
Initially, the Rights will be attached to all certificates
representing Common Shares then outstanding, and no separate
Right Certificates will be distributed. The Rights will separate
from the Common Shares upon the earlier to occur of (i) the first
date of public announcement of a person or group of affiliated or
associated persons having acquired beneficial ownership of
15percent or more of the outstanding Common Shares (except
pursuant to a Permitted Offer, as hereinafter defined); or
(ii) 10 days (or such later date as the Board of Directors of the
Corporation (the "Board") may determine) following the
commencement of, or announcement of an intention to make, a
tender offer or exchange offer the consummation of which would
result in a person or group becoming an Acquiring Person (as
hereinafter defined) (the earlier of such dates being called the
"Distribution Date"). A person or group whose acquisition of
Common Shares causes a Distribution Date pursuant to clause (i)
above is an "Acquiring Person." The first date of public
announcement that a person or group has become an Acquiring
Person is the "Shares Acquisition Date."
The Rights Agreement provides that, until the Distribution
Date, the Rights will be transferred with and only with the
Common Shares. Until the Distribution Date (or earlier
redemption or expiration of the Rights) new Common Share
certificates issued after the Record Date upon transfer or new
issuance of Common Shares will contain a notation incorporating
the Rights Agreement by reference. Until the Distribution Date
(or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for Common Shares
outstanding as of the Record Date, even without such notation or
a copy of this Summary of Rights being attached thereto, will
also constitute the transfer of the Rights associated with the
Common Shares represented by such certificate. As soon as
practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be
mailed to holders of record of the Common
C-1
<PAGE>
Shares as of the close of business on the Distribution Date (and
to each initial record holder of certain Common Shares issued
after the Distribution Date), and such separate Right
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date
and will expire at the close of business on April 15, 2009,
unless earlier redeemed or exchanged by the Corporation as
described below.
In the event that any person or group becomes an Acquiring
Person (except pursuant to a tender or exchange offer which is
for all outstanding Common Shares at a price and on terms which a
majority of certain members of the Board determines to be
adequate and in the best interests of the Corporation, its
stockholders and other relevant constituencies, other than such
Acquiring Person, its affiliates and associates (a "Permitted
Offer")), each holder of a Right will thereafter have the right
(the "Flip-In Right") to receive upon exercise the number of
Common Shares or of one one-thousandths of a share of Preferred
Shares (or, in certain circumstances, other securities of the
Corporation) having a value (immediately prior to such triggering
event) equal to two times the exercise price of the Right.
Notwithstanding the foregoing, following the occurrence of the
event described above, all Rights that are, or (under certain
circumstances specified in the Rights Agreement) were,
beneficially owned by any Acquiring Person or any affiliate or
associate thereof will be null and void.
In the event that, at any time following the Shares
Acquisition Date, (i) the Corporation is acquired in a merger or
other business combination transaction in which the holders of
all of the outstanding Common Shares immediately prior to the
consummation of the transaction are not the holders of all of the
surviving corporation's voting power, or (ii) more than 50 percent
of the Corporation's assets or earning power is sold or
transferred, then each holder of a Right (except Rights which
previously have been voided as set forth above) shall thereafter
have the right (the "Flip-Over Right") to receive, upon exercise,
common shares of the acquiring company having a value equal to
two times the exercise price of the Right. The holder of a Right
will continue to have the Flip-Over Right whether or not such
holder exercises or surrenders the Flip-In Right.
The Purchase Price payable, and the number of Preferred
Shares, Common Shares or other securities issuable, upon exercise
of the Rights are subject to adjustment from time to time to
prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred
Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights or warrants to subscribe for or purchase Preferred
Shares at a price, or securities convertible into Preferred
Shares with a conversion price, less than the then current market
price of the Preferred Shares, or (iii) upon the distribution to
holders of the Preferred Shares of evidences of indebtedness or
assets (excluding regular quarterly cash dividends) or of
subscription rights or warrants (other than those referred to
above).
The Purchase Price and number of outstanding Rights are also
subject to adjustment in the event of a stock split of the Common
Shares or a stock dividend on the Common Shares payable in
C-2
<PAGE>
Common Shares or subdivisions, consolidations or combinations of
the Common Shares occurring, in any such case, prior to the
Distribution Date.
Preferred Shares purchasable upon exercise of the Rights
will not be redeemable. Each Preferred Share will be entitled to
a minimum preferential quarterly dividend payment of $10.00 per
share but, if greater, will be entitled to an aggregate dividend
per share of 1,000 times the dividend declared per Common Share.
In the event of liquidation, the holders of the Preferred Shares
will be entitled to a minimum preferential liquidation payment of
$1,000 per share; thereafter, and after the holders of the Common
Shares receive a liquidation payment of $1.00 per share, the
holders of the Preferred Shares and the holders of the Common
Shares will share the remaining assets in the ratio of 1,000 to 1
(as adjusted) for each Preferred Share and Common Share so held,
respectively. Each Preferred Share will have 1,000 votes, voting
together with the Common Shares. Finally, in the event of any
merger, consolidation or other transaction in which Common Shares
are exchanged, each Preferred Share will be entitled to receive
1,000 times the amount received per Common Share. These rights
are protected by customary antidilution provisions. In the event
that the amount of accrued and unpaid dividends on the Preferred
Shares is equivalent to six full quarterly dividends or more, the
holders of the Preferred Shares shall have the right, voting as a
class, to elect two directors in addition to the directors
elected by the holders of the Common Shares until all cumulative
dividends on the Preferred Shares have been paid through the last
quarterly dividend payment date or until non-cumulative dividends
have been paid regularly for at least one year.
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an
adjustment of at least 1 percent in such Purchase Price. No
fractional Preferred Shares will be issued (other than fractions
which are one one-thousandth or integral multiples of one one-
thousandth of a Preferred Share, which may, at the election of
the Board, be evidenced by depositary receipts) and in lieu
thereof, an adjustment in cash will be made based on the market
price of the Preferred Shares on the last trading day prior to
the date of exercise.
At any time prior to the earlier to occur of (i) a person
becoming an Acquiring Person or (ii) the expiration of the
Rights, and under certain other circumstances, the Corporation
may redeem the Rights in whole, but not in part, at a price of
$.005 per Right (the "Redemption Price") which redemption shall
be effective upon the action of the Board. Additionally,
following the Shares Acquisition Date, the Corporation may redeem
the then outstanding Rights in whole, but not in part, at the
Redemption Price, provided that such redemption is in connection
with a merger or other business combination transaction or series
of transactions involving the Corporation in which all holders of
Common Shares are treated alike but not involving an Acquiring
Person or its affiliates or associates.
At any time after any person or group becomes an Acquiring
Person and prior to the acquisition by such person or group of
50 percent or more of the outstanding Common Shares, the Board may
exchange the Rights (other than Rights owned by the Acquiring
Person, which will have become void), in whole or in part, at an
exchange ratio of one Common Share, or one
C-3
<PAGE>
one-thousandth of a Preferred Share (or of a share of a class or
series of the Corporation's preferred stock having equivalent
rights, preferences and privileges), per Right (subject to
adjustment).
All of the provisions of the Rights Agreement may be amended
by the Board prior to the Distribution Date. After the
Distribution Date, the provisions of the Rights Agreement may be
amended by the Board only in order to cure any ambiguity, defect
or inconsistency, to make changes which do not adversely affect
the interests of holders of Rights (excluding the interests of
any Acquiring Person), or, subject to certain limitations, to
shorten or lengthen any time period under the Rights Agreement.
Until a Right is exercised or exchanged, the holder thereof,
as such, will have no right to vote or receive dividends or other
distributions and will have no other rights as a stockholder of
the Corporation. While the distribution of the Rights will not
be taxable to stockholders of the Corporation, stockholders may,
depending upon the circumstances, recognize taxable income should
the Rights become exercisable or upon the occurrence of certain
events thereafter.
A copy of the Rights Agreement has been filed with the
U.S. Securities and Exchange Commission as an Exhibit to the
Corporation's Registration Statement on Form 8-A dated
April , 1999. A copy of the Rights Agreement is available
------
free of charge from the Corporation. 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
hereby incorporated herein by reference.
C-4
