SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A12G
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
CROWN AMERICAN REALTY TRUST
(Exact Name of Registrant as Specified in its Charter)
Maryland 1-12216 25-1713733
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification
incorporation) Number)
PASQUERILLA PLAZA, JOHNSTOWN, PENNSYLVANIA 15901
(Address of principal executive offices)
(814) 536-4441
(Registrant's telephone number)
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), please check the following box. [ ]
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), please check the following box. [ X ]
Securities Act registration statement file number to which this form relates:
(if applicable)
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
None
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
Preferred Shares Purchase Rights
(Title of Class)
Item 1. Description Of Registrant's Securities To Be Registered.
On January 20, 2000, the Board of Trustees of Crown American Realty
Trust (the "Company") declared a dividend of one preferred share purchase right
(a "Right") for each outstanding Common Share of Beneficial Interest, par value
$0.01 per share (the "Common Shares"), of the Company. The dividend is payable
to stockholders of record at the close of business on February 4, 2000 (the
"Record Date"). The Board also authorized the issuance of one Right with
respect to each Common Share that becomes outstanding after the Record Date and
prior to the Distribution Date as defined below (or earlier redemption or
expiration of the Rights). Each Right entitles the registered holder, when the
Right becomes exercisable, to purchase from the Company one one-hundredth of a
share of Series A Junior Participating Preferred Shares of Beneficial Interest
(the "Preferred Shares") of the Company at a price of $20.00 (the "Purchase
Price"), subject to adjustment. The description and terms of the Rights are set
forth in a Rights Agreement, dated January 20, 2000, between the Company and
American Stock Transfer and Trust Company, as Rights Agent (the "Rights
Agreement").
Until the earlier to occur of (i) 10 days following a public
announcement that a person or group of affiliated or associated persons (an
"Acquiring Person") has acquired beneficial ownership of 20% or more of the
outstanding Common Shares or (ii) 10 business days (or such later date as may be
determined by the Board of Trustees prior to the time a person or group becomes
an Acquiring Person) following the commencement of, or announcement of an
intention to make, a tender offer or exchange offer the consummation of which
would result in the beneficial ownership by a person or group of 20% or more of
the outstanding Common Shares (the earlier of such dates being the "Distribution
Date"), the Rights will be evidenced, in the case of Common Share certificates
outstanding as of the Record Date, by such Common Share certificates.
The Rights Agreement provides that, until the Distribution Date (or
earlier redemption or expiration of the Rights), the Rights will be transferred
with and only with the Common Shares. With respect to new Common Shares issued
in certificated form after the Record Date and prior to the Distribution Date
(or earlier redemption or expiration of the Rights), the certificates evidencing
such shares will contain a notation incorporating the Rights Agreement by
reference. With respect to new Common Shares issued in uncertificated form
after the Record Date and prior to the Distribution Date (or earlier redemption
or expiration of the Rights) and with respect to Common Shares outstanding on
the Record Date which become uncertificated thereafter prior to the Distribution
Date (or earlier redemption or expiration of the Rights), any confirmation or
advice by the Company with respect to such shares shall contain a notice of the
existence of the Rights. Until the Distribution Date (or earlier redemption or
expiration of the Rights), holders of record of the Common Shares shall also be
the holders of record of the associated Rights and the surrender for transfer of
any Common Shares will also constitute the transfer of the associated Rights.
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
such separate Right Certificates alone will evidence the Rights. The form of
Right Certificate is attached to the Rights Agreement as Exhibit B.
The Rights are not exercisable until the Distribution Date. The
Rights will expire on January 20, 2010 (the "Final Expiration Date"), unless the
Final Expiration Date is extended or unless the Rights are earlier redeemed or
exchanged, in each case, as described below.
The Purchase Price payable, and the number of Preferred Shares or
other securities or property issuable, upon exercise of the Rights are subject
to adjustment from time to time to prevent dilution (i) in the event of a share
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 periodic cash dividends paid out of earnings or
retained earnings or dividends payable in Preferred Shares) or of subscription
rights or warrants (other than those referred to above).
The number of outstanding Rights and the number of one one-hundredths
of a Preferred Share issuable upon exercise of each Right are also subject to
adjustment in the event of a share split of the Common Shares or a share
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 (or earlier redemption or expiration of the
Rights).
Preferred Shares purchasable upon exercise of the Rights will not be
redeemable. Each Preferred Share will be entitled to a cumulative preferential
quarterly dividend payment on the dates, if any, that quarterly dividend
payments are normally paid to holders of the Common Shares, of the greater of
(a) $1 or (b) 100 times the aggregate per share amount of all dividends (other
than dividends payable in Common Shares) paid in respect of the Common Shares,
subject to adjustment. In the event of liquidation, the holders of the
Preferred Shares will be entitled to a preferential liquidation payment of $100
per share plus accrued and unpaid dividends, provided, however, that the holders
of the Preferred Shares will be entitled to receive an aggregate amount per
share of 100 times the payment made per Common Share. Each Preferred Share will
have 100 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 100 times the amount
received per Common Share. These rights are protected by customary antidilution
provisions.
Because of the nature of the dividend, liquidation and voting rights
of the Preferred Shares, the value of the one one-hundredths of a Preferred
Share purchasable upon exercise of each Right should approximate the value of
one Common Share. The form of Articles Supplementary Relating to Designation,
Preferences and Rights of the Preferred Shares is attached to the Rights
Agreement as Exhibit A.
In the event that any person or group of affiliated or associated
persons becomes an Acquiring Person, each holder of a Right, other than Rights
beneficially owned by the Acquiring Person (which will thereafter be void), will
thereafter have the right to receive, upon exercise of the Right, that number of
Common Shares (or Preferred Shares) having a market value of two times the then
current exercise price of the Right. Also, in the event that the Company is
acquired in a merger or other business combination transaction or 50% or more of
its consolidated assets or earning power are sold after a person or group has
become an Acquiring Person, proper provision must be made so that each holder of
a Right (other than Rights which have become void) will thereafter have the
right to receive, upon the exercise of the Right, that number of common shares
of the acquiring company which at the time of such transaction will have a
market value of two times the then current exercise price of the Right.
At any time after any person or group becomes an Acquiring Person and
prior to the acquisition by a person or group of beneficial ownership of 50% or
more of the outstanding Common Shares, the Board of Trustees may require the
exchange of the Rights (other than Rights which have become void), in whole or
in part, at an exchange ratio of one Common Share, or one one-hundredth of a
Preferred Share (or one share of a class or series of the Company's preferred
shares having equivalent rights, preferences and privileges), per Right, subject
to adjustment.
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional Preferred Shares will be issued upon
exercise of a Right (other than fractions which are integral multiples of one
one-hundredth of a Preferred Share, which may, at the election of the Company,
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 acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 20% or more of the
outstanding Common Shares, the Board of Directors may redeem the Rights in
whole, but not in part, at a price of $0.001 per Right (the "Redemption Price"),
subject to adjustment. The redemption of the Rights may be made effective at
such time, on such basis and with such conditions as the Board of Directors in
its sole discretion may establish. Immediately upon any redemption of the
Rights, the right to exercise the Rights will terminate and the only right of
the holders of Rights will be to receive the Redemption Price.
The terms of the Rights may be amended by the Board of Trustees
without the consent of the holders of the Rights, except that from and after
such time as any person or group of affiliated or associated persons becomes an
Acquiring Person, no amendment may adversely affect the interests of the holders
of the Rights. Prior to any person becoming an Acquiring Person, the Company
may without the consent of the holders of the Rights lower the 20% thresholds
referred to above to not less than the greater of (i) the sum of .001% and the
largest percentage of the outstanding Common Shares then known to the Company to
be beneficially owned by any person or group of affiliated or associated persons
and (ii) 10%.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends.
The Rights have certain antitakeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
on terms not approved by the Company's Board of Trustees, except pursuant to an
offer conditioned on a substantial number of Rights being acquired. The Rights
should not interfere with any merger or other business combination approved by
the Board because the Rights may be redeemed by the Company at the Redemption
Price prior to the time that a person or group acquires beneficial ownership of
20% or more of the Common Shares.
A copy of the Rights Agreement is filed with this current report as an
exhibit and is incorporated in the foregoing description of the Rights by
reference. The description is qualified in its entirety by reference to the
Rights Agreement.
Item 2. Exhibits.
Exhibit No. Document
1. Rights Agreement, dated January 20, 2000, between Crown
American Realty Trust and American Stock Transfer and Trust
Company, with the form of Articles Supplementary Relating to
Designation, Preferences and Rights of the Series A Junior
Participating Preferred Shares of Beneficial Interest, par value
$0.01 per share, of Crown American Trust Company attached as
Exhibit A, the form of Right Certificate attached as Exhibit B and
a Summary of Rights to Purchase Preferred Shares attached as
Exhibit C. Pursuant to the Rights Agreement, printed Right
Certificates will not be mailed until as soon as practicable after
the earlier of (i) the tenth day after public announcement that a
person or group of affiliated or associated persons (an "Acquiring
Person") has acquired beneficial ownership of 20% or more of the
Company's Common Shares or (ii) the tenth business day (or such
later date as may be determined by action of the Board of Trustees
prior to the time a person or group becomes an Acquiring Person)
after the commencement of, or the announcement of an intention to
make, a tender offer or exchange offer the consummation of which
would result in the beneficial ownership by a person or group of
20% or more of the Company's Common Shares. Pursuant to the
Rights Agreement, the Summary of Rights to Purchase Preferred
Shares will be mailed as soon as practicable following the Record
Date to the holders of the Common Shares as of the close of
business on the Record Date.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CROWN AMERICAN REALTY TRUST
By: /s/Mark Pasquerilla
Name: Mark Pasquerilla,
Title: President and Chief Executive Officer
Date: January 24, 2000
SECURITIES AND EXCHANGE COMMISSION
FORM 8-A12G
EXHIBIT INDEX
The following exhibits are filed as part of this Registration
Statement:
Exhibit No. Document
1. Rights Agreement, dated January 20, 2000, between Crown
American Realty Trust and American Stock Transfer and Trust
Company, with the form of Articles Supplementary Relating to
Designation, Preferences and Rights of the Series A Junior
Participating Preferred Shares of Beneficial Interest, par value
$0.01 per share, of Crown American Trust Company attached as
Exhibit A, the form of Right Certificate attached as Exhibit B and
a Summary of Rights to Purchase Preferred Shares attached as
Exhibit C. Pursuant to the Rights Agreement, printed Right
Certificates will not be mailed until as soon as practicable after
the earlier of (i) the tenth day after public announcement that a
person or group of affiliated or associated persons (an "Acquiring
Person") has acquired beneficial ownership of 20% or more of the
Company's Common Shares or (ii) the tenth business day (or such
later date as may be determined by action of the Board of Trustees
prior to the time a person or group becomes an Acquiring Person)
after the commencement of, or the announcement of an intention to
make, a tender offer or exchange offer the consummation of which
would result in the beneficial ownership by a person or group of
20% or more of the Company's Common Shares. Pursuant to the
Rights Agreement, the Summary of Rights to Purchase Preferred
Shares will be mailed as soon as practicable following the Record
Date to the holders of the Common Shares as of the close of
business on the Record Date.
EXHIBIT 1
CROWN AMERICAN REALTY TRUST
and
AMERICAN STOCK TRANSFER AND TRUST COMPANY
Rights Agent
Rights Agreement
Dated January 20, 2000
TABLE OF CONTENTS
Page
Section 1. Certain Definitions 1
Section 2. Appointment of Rights Agent 4
Section 3. Issue of Right Certificates 4
Section 4. Form of Right Certificates 6
Section 5. Countersignature and Registration of
Right Certificates 6
Section 6. Transfer, Split Up, Combination and Exchange
of Right Certificates; Mutilated, Destroyed,
Lost or Stolen Right Certificates 7
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights 8
Section 8. Cancellation and Destruction of Right
Certificates 9
Section 9. Reservation and Availability of Shares;
Securities Registration 9
Section 10. Shares Issue Date 10
Section 11. Adjustment of Purchase Price, Number of
Preferred Shares or Number of Rights 10
Section 12. Certificate of Adjusted Purchase Price or
Number of Shares 16
Section 13. Consolidation, Merger, Share Exchange or
Sale or Transfer of Assets or Earning
Power 16
Section 14. Fractional Rights and Fractional Shares 17
Section 15. Rights of Action 18
Section 16. Agreement of Right Holders 19
Section 17. Right Holder Not Deemed a Shareholder 19
Section 18. Concerning the Rights Agent 20
Section 19. Merger or Consolidation or Change of
Name of Rights Agent 20
Section 20. Duties of Rights Agent 21
Section 21. Change of Rights Agent 22
Section 22. Issuance of New Right Certificates 23
Section 23. Redemption 23
Section 24. Exchange 23
Section 25. Notice of Certain Events 25
Section 26. Notices 25
Section 27. Supplements and Amendments 26
Section 28. Successors 26
Section 29. Benefits of this Agreement 26
Section 30. Severability 26
Section 31. Governing Law 27
Section 32. Counterparts 27
Section 33. Descriptive Headings 27
Section 34. Beneficial Interests 27
Signatures 27
Exhibit A Form of Articles Supplementary Relating
to Designation, Preferences and Rights of
Series A Junior Participating
Preferred Shares of Beneficial Interest A-1
Exhibit B Form of Right Certificate B-1
Exhibit C Summary of Rights to Purchase Preferred
Shares C-1
THIS AGREEMENT, dated January 20, 2000, between CROWN AMERICAN REALTY
TRUST, a Maryland real estate investment trust (the "Company"), and AMERICAN
STOCK TRANSFER AND TRUST COMPANY (the "Rights Agent").
WITNESSETH THAT:
WHEREAS, the Board of Trustees of the Company has authorized and
declared a dividend of one preferred share purchase right (a "Right") for each
Common Share (as hereinafter defined) of the Company outstanding on February 4,
2000 (the "Record Date"), each Right representing the right to purchase one one-
hundredth 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).
NOW THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, and intending to be legally bound, 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 (as such term is
hereinafter defined) who or which, together with all Affiliates and
Associates (as such terms are hereinafter defined) of such Person, shall be
the Beneficial Owner (as such term is hereinafter defined) of twenty
percent (20%) or more of the Common Shares of the Company then outstanding,
but shall not include the Company or any Related Entity (as such term is
hereinafter defined). Notwithstanding the foregoing, no Person shall
become an "Acquiring Person" as the result of an acquisition of Common
Shares by the Company which, by reducing the number of shares outstand-
ing, increases the proportionate number of shares beneficially owned by
such Person to twenty percent (20%) or more of the Common Shares of the
Company then outstanding; provided, however, that if a Person shall
become the Beneficial Owner of twenty percent (20%) or more of the
Common Shares of the Company then outstanding by reason of share purchases
by the Company and shall, after such share purchases by the Company, become
the Beneficial Owner of any additional Common Shares of the Company, then
such Person shall be deemed to be an "Acquiring Person". Notwithstanding
the foregoing, if the Board of Trustees of the Company determines in
good faith that a Person who would otherwise be an "Acquiring Person",
as defined pursuant to the foregoing provisions of this paragraph (a),
has become such inadvertently, and such Person divests as promptly as
practicable a sufficient number of Common Shares so that such Person
would no longer be an "Acquiring Person", as defined pursuant to the
foregoing provisions of this paragraph (a), then such Person shall not be
deemed to be an "Acquiring Person" for any purposes of this Agreement.
(b) "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 such term is hereinafter defined),
as in effect on the date of this Agreement.
(c) 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 beneficially owns, directly or indirectly, as defined
in Rules 13d-3 and 13d-5 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 has
(A) the right to acquire (whether such right is exercisable
immediately or only after the passage of time, and
regardless of any conditions to the exercise of such right
(whether or not such conditions then are or could be
satisfied)) pursuant to any agreement, arrangement or
understanding (other than customary agreements with and
between underwriters and selling group members with respect
to a bona fide public offering of securities), or upon the
exercise of conversion rights, exchange rights, rights
(other than these Rights), warrants or options, or
otherwise; 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 pursuant to any agreement, arrangement
or understanding; provided, however, that a Person shall not
be deemed the Beneficial Owner of, or to beneficially own,
any security if the agreement, arrangement or understanding
to vote such security (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
(iii) which are beneficially owned, directly or indirectly,
by any other Person with which such Person or any of such
Person's Affiliates or Associates has any agreement, arrange-
ment or understanding (other than customary agreements
with and between underwriters and selling group members with
respect to a bona fide public offering of securities) for the
purpose of acquiring, holding, voting (except to the extent
contemplated by the proviso to Section 1(c)(ii)(B))
or disposing of any securities of the Company.
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 Company,
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.
(d) "Business Day" shall mean any day other than a Saturday,
a Sunday, or a day on which banking institutions in the State of New York
are authorized or obligated by law or executive order to close.
(e) "close of business" on any given date shall mean 5:00 P.M.,
local time in New York, New York, on such date; provided, however, that if
such date is not a Business Day it shall mean 5:00 P.M., local time in New
York, New York, on the next succeeding Business Day.
(f) "Common Shares" when used with reference to the Company
shall mean the shares of Common Shares of Beneficial Interest, par value
$0.01, of the Company. "Common Shares" when used with reference to any
Person other than the Company shall mean the capital stock (or analogous
equity interest in the case of a Person which is not a corporation) with
the greatest voting power of such other Person or, if such other Person is
a Subsidiary of another Person, of the Person or Persons which ultimately
control such first-mentioned Person.
(g) "Distribution Date" shall have the meaning set forth in
Section 3 hereof.
(h) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
(i) "Exchange Ratio" shall have the meaning set forth in Section
24(a) hereof.
(j) "Final Expiration Date" shall have the meaning set forth in
Section 7 hereof.
(k) "Flip-Over Entity" shall have the meaning set forth in
Section 13(b) hereof.
(l) "Person" shall mean any individual, firm, partnership,
association, group (as such term is used in Rule 13d-5 under the Exchange
Act, as such Rule is in effect on the date of this Agreement),
corporation, real estate investment trust, or other entity, and shall
include any successor (by merger or otherwise) of such entity.
(m) "Preferred Shares" shall mean shares of Series A Junior
Participating Preferred Shares of Beneficial Interest, par value $0.01 per
share, of the Company having the rights and preferences set forth in the
Form of Articles Supplementary Relating to Series A Junior Participating
Preferred Shares of Beneficial Interest attached to this Agreement as
Exhibit A hereto, and, to the extent that there are not a sufficient number
of shares of Series A Junior Participating Preferred Shares of Beneficial
Interest authorized to permit the full exercise of the Rights, any other
series of Preferred Shares of Beneficial Interest, par value $0.01 per
share, of the Company designated for such purpose containing terms sub-
stantially similar to the terms of the Series A Junior Participating
Preferred Shares of Beneficial Interest.
(n) "Purchase Price" shall have the meaning set forth in
Section 4 hereof.
(o) "Record Date" shall have the meaning set forth in the
introductory paragraph hereof.
(p) "Redemption Date" shall have the meaning set forth in
Section 7 hereof.
(q) "Related Entity" shall mean any Subsidiary of the Company,
any employee benefit plan of the Company or of any Subsidiary of the
Company, or any entity holding Common Shares for or pursuant to the terms
of any such plan.
(r) "Right" shall have the meaning set forth in the introductory
paragraph hereof.
(s) "Right Certificate" shall mean the Right Certificates
authorized to be issued as provided in Section 3 hereof, but excluding
Right Certificates which represent Rights that have become void pursuant to
Section 11(a)(ii) hereof.
(t) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(u) "Shares Acquisition Date" shall mean the first date of
public announcement (including, without limitation, a report filed pursuant
to Section 13(d) or 14(d) under the Exchange Act) by the Company or an
Acquiring Person that an Acquiring Person has become such.
(v) "Subsidiary" of any Person shall mean any 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.
Section 2. Appointment of Rights Agent. The Company hereby appoints
the Rights Agent to act as agent for the Company and the holders of the Rights
(who, in accordance with Section 3 hereof, shall prior to the Distribution Date
also be the holders of the Common Shares) in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such co-Rights Agents as it may deem
necessary or desirable.
Section 3. Issue of Right Certificates.
(a) Until the earlier of (i) the tenth day after the Shares
Acquisition Date or (ii) the tenth Business Day (or such later date as may
be determined by action of the Board of Trustees prior to such time as any
Person becomes an Acquiring Person) after the date of the commencement by
any Person (other than the Company or any Related Entity) of, or of the
first public announcement of the intention of any Person (other than the
Company or any Related Entity) to commence, a tender or exchange offer the
consummation of which would result in any Person becoming the Beneficial
Owner of Common Shares aggregating twenty percent (20%) or more of the
then outstanding Common Shares (including any such date which is after
the Record Date and prior to the issuance of the Rights; the earlier of
such dates being herein referred to as the "Distribution Date"), (x) the
Rights will be evidenced (subject to the provisions of Section 3(b) hereof)
by the Common Shares (certificated or otherwise) registered in the names of
the holders thereof (if such shares are certificated, such certificates
shall also be deemed to be Right Certificates) and not by separate Right
Certificates, and (y) the right to receive Right Certificates will be
transferable only in connection with the transfer of Common Shares. As
soon as practicable after the Distribution Date, the Company will prepare
and execute, the Rights Agent will countersign and the Company will send or
cause to be sent (and the Rights Agent will, if requested, send) by first-
class, insured, postage-prepaid mail, 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 Company, a Right
Certificate, in substantially the form of Exhibit B hereto (a "Right
Certificate"), evidencing one Right for each Common Share so held. As of
the Distribution Date, the Rights will be evidenced solely by such Right
Certificates.
(b) As soon as practicable following the Record Date, the
Company 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, postage paid mail, 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 Company.
(c) With respect to certificated 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 of such Common
Shares, the holders of such certificates shall be deemed to be the holders
of the associated Rights and the registered holders of the Common Shares
shall also be the registered holders of the associated Rights. 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 shall also constitute the transfer of
the Rights associated with the Common Shares represented thereby.
(d) Certificates for certificated shares of Common Shares which
become outstanding (including, without limitation, because of resale or
transfer by the Company of treasury shares) after the Record Date but prior
to the earliest of the Distribution Date, the Redemption Date or the Final
Expiration Date shall have impressed on, printed on, written on or
otherwise affixed to them the following legend:
This certificate also evidences and entitles the holder hereof to
certain rights as set forth in a Rights Agreement between Crown
American Realty Trust (the "Company") and American Stock Transfer
and Trust Company, dated January 20, 2000 (as amended from time
to time, the "Rights Agreement"), the terms of which are hereby
incorporated herein by reference and a copy of which is on file
at the principal executive offices of the Company. The Company
will mail to the holder of this certificate a copy of the Rights
Agreement without charge after receipt of a written request
therefor. 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.
Under certain circumstances as set forth in the Rights Agreement,
the Rights may be redeemed or exchanged for other securities of
the Company at the option of the Company. As described in the
Rights Agreement, Rights which are beneficially owned by any
Person who becomes an Acquiring Person or an Associate or an
Affiliate thereof (each as defined in the Rights Agreement) will
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 Company purchases or acquires
any Common Shares after the Record Date but prior to the Distribution Date
(other than Common Shares held in a fiduciary capacity or pursuant to any
employee benefit plan of the Company or any Subsidiary of the Company), any
Rights associated with such Common Shares shall be deemed canceled and
retired so that the Company shall not be entitled to exercise any Rights
associated with such Common Shares.
(e) With respect to Common Shares which become uncertificated
(including, without limitation, because of a resale or transfer by the
Company of treasury shares) after the Record Date but prior to the earliest
of the Distribution Date, the Redemption Date or the Final Expiration Date,
any confirmation or advice by the Company in connection with the issuance
or transfer thereof shall contain a notice of the existence of the Rights
associated with such Common Shares. The form of such notice shall be as
the Company may elect from time to time. Without limiting the generality
of the foregoing, such notice may take the form of (i) a general statement
to the effect that the Rights are attached to such Common Shares and
that a shareholder may obtain a full copy of the text of such rights free
of charge from the Company or (ii) a statement similar to the following:
Until the Distribution Date (as defined in the Rights
Agreement referred to below), holders of shares of Common
Shares of Beneficial Interest, par value $0.01, of Crown
American Realty Trust (the "Company") are entitled to
certain Rights as set forth in a Rights Agreement between
the Company and American Stock Transfer and Trust Company ,
dated January 20, 2000 (as amended from time to time, the
"Rights Agreement"), the terms of which are hereby
incorporated herein by reference and a copy of which is on
file at the principal executive offices of the Company. The
Company will mail to any holder of the Common Shares of
Beneficial Interest a copy of the Rights Agreement without
charge after receipt of a written request therefor. Under
certain circumstances as set forth in the Rights Agreement,
such Rights will be evidenced by separate certificates.
Under certain circumstances as set forth in the Rights
Agreement, the Rights may be redeemed or exchanged for other
securities of the Company at the option of the Company. As
described in the Rights Agreement, Rights which are
beneficially owned by any Person who becomes an Acquiring
Person or an Associate or an Affiliate thereof (each as
defined in the Rights Agreement) will become null and void.
Section 4. Form of Right Certificates. The Right Certificates (and
the forms of assignment and of election to purchase to be printed on the reverse
thereof) shall be substantially the same as Exhibit B hereto and may have such
marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on which the Rights
may from time to time be listed, or to conform to usage. Subject to the
provisions of Section 22 hereof, the Right Certificates shall entitle the
holders thereof to purchase such number of one one-hundredths of a Preferred
Share as shall be set forth therein at the price per one one-hundredth of a
Preferred Share set forth therein (as such price may be adjusted from time to
time pursuant to the terms hereof, the "Purchase Price"), but the number of such
one one-hundredths of a Preferred Share and the Purchase Price shall be subject
to modification and adjustment as provided herein.
Section 5. Countersignature and Registration of Right Certificates.
(a) The Right Certificates shall be executed on behalf of the
Company by its Chief Executive Officer, President, any Vice President or
Treasurer, either manually or by facsimile signature, shall have affixed
thereto the Company's seal or a facsimile thereof and shall be attested by
the Secretary or Assistant Secretary of the Company, either manually or by
facsimile signature. The Right Certificates shall be countersigned by the
Rights Agent, either manually or by facsimile signature, and shall not be
valid for any purpose unless countersigned. In case any officer of the
Company who shall have signed any of the Right Certificates shall cease to
be such officer of the Company before countersignature by the Rights Agent
and issuance and delivery by the Company, such Right Certificates, never-
theless, may be countersigned by the Rights Agent and issued and delivered
by the Company with the same force and effect as though the Person who
signed such Right Certificates had not ceased to be such officer of the
Company; and any Right Certificate may be signed on behalf of the Company
by any Person who, at the actual date of the execution of such Right
Certificate, shall be a proper officer of the Company to sign such Right
Certificate, although at the date of the execution of this Agreement any
such Person was not such an officer.
(b) Following the Distribution Date, the Rights Agent will keep
or cause to be kept, at its principal office, 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 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 Section 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 (other than
Right Certificates representing Rights that have become void pursuant to
Section 11(a)(ii) hereof or that have been exchanged pursuant to Section 24
hereof) 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-hundredths of a Preferred Share as the
Right Certificate or Right Certificates surrendered then entitled such
holder to purchase. Any registered holder desiring to transfer, split
up, combine or exchange any Right Certificate 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 principal office of the
Rights Agent. Neither the Rights Agent nor the Company shall be obligated
to take any action with respect to transfer of any such surrendered Right
Certificate until the registered holder thereof 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
Owners) or Affiliates or Associates thereof as the Company shall reasonably
request. Thereupon, subject to Section 20(j) hereof, the Rights Agent
shall countersign and deliver to the Person entitled thereto a Right
Certificate or Right Certificates, as the case may be, as so requested.
The Company may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to them, and,
at the Company's request, reimbursement to the Company and the Rights Agent
of all reasonable expenses incidental thereto, and upon surrender to the
Rights Agent and cancellation of the Right Certificate if mutilated, the
Company will make and deliver a new Right Certificate of like tenor to the
Rights Agent for delivery to the registered holder in lieu of the Right
Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights.
(a) The registered holder of any Right Certificate may exercise
the Rights evidenced thereby (except as otherwise provided herein) in whole
or in part at any time after the Distribution Date upon surrender of the
Right Certificate, with the form of election to purchase on the reverse
side thereof duly executed, to the Rights Agent at the principal office of
the Rights Agent, together with payment of the Purchase Price for each
one one-hundredth of a Preferred Share as to which the Rights are
exercised, at or prior to the earliest of (i) the close of business on
January 20, 2010 (the "Final Expiration Date"), (ii) the time at
which the Rights are redeemed as provided in Section 23 hereof (the
"Redemption Date") or (iii) the time at which the Rights are exchanged as
provided in Section 24 hereof.
(b) The Purchase Price for each one one-hundredth of a Preferred
Share purchasable pursuant to the exercise of a Right shall initially be
$20.00, shall be subject to adjustment from time to time as provided in
Section 11 or 13 hereof and shall be payable in lawful money of the United
States of America in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing exercis-
able Rights, with the form of election to purchase duly executed,
accompanied by payment of the Purchase Price for the shares to be purchased
and an amount equal to any applicable transfer tax required to be paid by
the holder of such Right Certificate in accordance with Section 9 hereof by
certified check, cashier's check or money order payable to the order of the
Company, the Rights Agent shall, subject to Section 20(j) hereof, thereupon
promptly (i) (A) requisition from the transfer agent of the Preferred
Shares certificates for the number of Preferred Shares to be purchased and
the Company hereby irrevocably authorizes its transfer agent to comply with
all such requests or (B) requisition from the depositary agent deposi-
tary receipts representing such number of one one-hundredths 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 Company hereby
directs the depositary agent to comply with such request, (ii) when
appropriate, requisition from the Company the amount of cash to be paid in
lieu of issuance of fractional shares in accordance with Section 14 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, deliver such cash to
or upon the order of the registered holder of such Right Certificate.
(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 unexer-
cised shall be issued by the Rights Agent to the registered holder of such
Right Certificate or to his duly authorized assigns, subject to the pro-
visions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to issue any
Preferred Shares or undertake any other action upon any exercise or
purported exercise of a Right unless the registered holder of such Right
shall have (i) completed and signed the certificate contained in the form
of election to purchase set forth on the reverse side of the Right
Certificate surrendered for such exercise and (ii) provided such
additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company
shall reasonably request.
Section 8. Cancellation 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 Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered to the Rights Agent, shall be canceled 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 Company 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
Company (other than in a fiduciary capacity or pursuant to any employee benefit
plan of the Company or any Subsidiary of the Company) otherwise than upon the
exercise thereof. The Rights Agent shall deliver all canceled Right
Certificates to the Company, or shall, at the written request of the Company,
destroy such canceled Right Certificates, and in such case shall deliver a
certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Preferred Shares;
Securities Registration.
(a) The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued Preferred
Shares or any Preferred Shares held in its treasury, the number of Pre-
ferred Shares that will be sufficient to permit the exercise in full of all
outstanding Rights in accordance with Section 7 hereof. Notwithstanding
the foregoing or anything else contained herein, prior to the Board of
Trustees of the Company determining that any Person has become an Acquiring
Person, the Company shall not be obligated to cause to be reserved and
kept available any Common Shares to permit the exercise of any outstanding
Rights pursuant to Section 11(a)(ii) hereof, or any exchange pursuant to
Section 24 hereof, or to cause to be reserved and kept available any
Preferred Shares (other than those referred to in the preceding
sentence). The Company covenants and agrees that it will not, after any
determination by its Board of Trustees that any Person has become an
Acquiring Person, take any action that would reduce the number of its
authorized and unissued Common Shares and Preferred Shares and Common
Shares and Preferred Shares held in its treasury (exclusive of shares
previously reserved for other purposes) below the number sufficient to
permit the exercise in full of all outstanding Rights, and if at any such
time the number of such authorized and unissued and treasury shares not
otherwise reserved is less than the number sufficient to permit the
exercise in full of all outstanding Rights, the Company shall not take
any action that would increase such shortfall.
(b) The Company shall use all reasonable efforts to cause, from
and after such time as the Rights become exercisable, all Preferred Shares
to be listed, upon official notice of issuance, upon a national securities
exchange, or to be eligible for quotation in the New York Stock Exchange
Composite Transactions Tape (as published in the Wall Street Journal or, if
not therein, in another authoritative source) or any successor thereto or
other comparable quotation system.
(c) To the extent necessary to permit the Rights to be exercised
in accordance with the terms of this Agreement without conflict with
applicable law, the Company shall use its best efforts to (i) file as soon
as is practicable following the Distribution Date a registration statement
on the appropriate formunder the Securities Act with respect to the
securities purchasable upon the exercise of the rights, (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 requirements of the Securities
Act) until the earlier of (A) the date as of which the Rights are no longer
exercisable for such securities and (B) the date of the expiration of
the Rights. To the extent necessary to permit the Rights to be
exercised in accordance with the terms of this Agreement without con-
flict with applicable law, the Company shall also use its best
efforts as soon as practicable following the Distribution Date to take such
action as may be appropriate under the securities laws of the various
states. The Company may temporarily suspend the exercisability of the
Rights in some or all jurisdictions to the extent necessary to avoid such
conflict pending effectiveness of such registration statement and such
action under the state securities laws. Upon any such suspension, the
Company shall make a public announcement stating that the exercisability of
the Rights has been temporarily suspended. Notwithstanding any provision
of this Agreement to the contrary, the Rights shall not be exercisable in
any jurisdiction unless the requisite qualification in such jurisdiction
shall have been obtained.
(d) The Company covenants and agrees that it will take all such
action as may be necessary to ensure that all Preferred Shares delivered
upon exercise of Rights shall, at the time of delivery of such Preferred
Shares (subject to payment of the Purchase Price), be duly and validly
authorized and issued, fully paid and nonassessable shares.
(e) The Company further covenants and agrees that it will pay
when due and payable any and all federal and state transfer taxes and
charges which may be payable in respect of the issuance or delivery of the
Right Certificates or of any Preferred Shares upon the exercise of Rights.
The Company shall not, however, be required to pay any transfer tax which
may be payable in respect of any transfer or delivery of Right Certificates
to a Person other than, or the issuance or delivery of certificates or
shares or depositary receipts for the Preferred Shares 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 upon the
exercise of any Rights until any such tax shall have been paid (any such
tax being payable by the holder of such Right Certificate at the time of
surrender) or until it has been established to the Company's reasonable
satisfaction that no such tax is due.
Section 10. Preferred Shares Issue Date. Each Person in whose name
any Preferred Shares are issued upon the exercise of Rights shall for all
purposes be deemed to have become the holder of record of such Preferred Shares
on, and, if such shares are certificated, 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) was made; provided, however, that if the date of such surrender and pay-
ment is a date upon which the transfer books for the Preferred Shares of the
Company are closed, such Person shall be deemed to have become the record holder
of such shares on, and such certificate shall be dated, the next succeeding
Business Day on which the transfer books for the Preferred Shares of the Company
are open. Prior to the exercise of the Rights evidenced thereby, the holder of
a Right Certificate shall not be entitled to any rights of a holder of Preferred
Shares for which the Rights shall be exercisable, including, without limitation,
the right to vote, to receive dividends or other distributions or to exercise
any preemptive rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price, Number of Preferred Shares
or Number of Rights. The Purchase Price, the number of Preferred 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 Company shall at any time after the
date of this Agreement (A) declare a dividend on the Preferred Shares pay-
able in Preferred Shares, (B) subdivide the outstanding 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 reclass-
ification of the Preferred Shares (including any such reclassification in
connection with a consolidation or merger in which the Company is the
continuing or surviving real estate investment trust), except as otherwise
provided in this Section 11(a), the Purchase Price in effect at the time of
the record date for such dividend or of the effective date of such sub-
division, 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
be entitled to receive the aggregate number and kind of shares of
capital stock which, if such Right had been exercised immediately prior to
such date and at a time when the Preferred Shares transfer books of the
Company were open, he or she would have owned upon such exercise and been
entitled to receive by virtue of such dividend, subdivision, combination or
reclassification; provided, however, that in no event shall the consider-
ation to be paid upon the exercise of one Right be less than the aggregate
par value of the shares of capital stock of the Company issuable upon
exercise of one Right, or if Common Shares of the Company shall be issuable
$0.01 per share.
(ii) Subject to the following paragraph and Section 24 of this
Agreement, in the event any Person becomes an Acquiring Person, each holder
of a Right shall thereafter have a right to receive, upon exercise thereof
at a price equal to the then current Purchase Price multiplied by the
number of one one-hundredths of a Preferred Share for which a Right is then
exercisable, in accordance with the terms of this Agreement and in lieu of
Preferred Shares, such number of Common Shares of the Company as shall
equal the result obtained by (x) multiplying the then current Purchase
Price by the number of one one-hundredths of a Preferred Share for which a
Right is then exercisable and dividing that product by (y) 50% of the then
current per share market price of the Company's Common Shares (determined
pursuant to Section 11(d) hereof) on the date of the occurrence of such
event. In the event that any Person shall become an Acquiring Person and
the Rights shall then be outstanding, the Company shall not take any action
which would eliminate or diminish the benefits intended to be afforded by
the Rights.
From and after the occurrence of such event, any Rights that are
or were acquired or beneficially owned by any Acquiring Person (or any
Associate or Affiliate of such Acquiring Person) shall be void and any
holder of such Rights shall thereafter have no right to exercise such
Rights under any provision of this Agreement. No Right Certificate shall
be issued pursuant to Section 3 that represents Rights beneficially owned
by an Acquiring Person whose Rights would be void pursuant to the preceding
sentence or any Associate or Affiliate thereof; no Right Certificate shall
be issued at any time upon the transfer of any Rights to an Acquiring
Person whose Rights would be void pursuant to the preceding sentence or any
Associate or Affiliate thereof or to any nominee of such Acquiring Person,
Associate or Affiliate; and any Right Certificate delivered to the Rights
Agent for transfer to an Acquiring Person whose Rights would be void
pursuant to the preceding sentence shall be canceled.
(iii) In the event that there shall not be sufficient Common
Shares issued but not outstanding or authorized but unissued to permit the
exercise in full of the Rights in accordance with the foregoing
subparagraph (ii), the Company shall take all such action as may be
necessary to authorize additional Common Shares for issuance upon exercise
of the Rights. In the event the Company shall, after good faith effort, be
unable to take all such action as may be necessary to authorize such
additional Common Shares, the Company shall substitute, for each Common
Share that would otherwise be issuable upon exercise of a Right, a number
of Preferred Shares or fraction thereof such that the current per share
market price of one Preferred Share multiplied by such number or fraction
is equal to the current per share market price of one Common Share as of
the date of issuance of such Preferred Shares or fraction thereof.
(b) In case the Company shall fix a record date for the issuance
of 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 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
defined in Section 11(d)) on such record date, the Purchase Price to be
in effect after such record date shall be determined by multiplying
the Purchase Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the number of 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 market price and the denominator of which
shall be the 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 con-
vertible 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 Company issuable upon exercise of one Right, or
if Common Shares of the Company shall be issuable $0.01 per share. In
case such subscription or purchase price may be paid in a 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 of
Trustees of the Company, whose determination shall be described in a
statement filed with the Rights Agent. Preferred Shares owned by or held
for the account of the Company shall not be deemed outstanding for the
purpose of any such computation. Such adjustment shall be made success-
ively 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 Company 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 Company is the continuing or surviving real estate investment
trust) of evidences of indebtedness or assets (other than a regular
periodic cash dividend, a cash dividend on account of accumulated and un-
paid regular periodic dividends or a dividend payable in Preferred Shares)
or subscription rights 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 of the Preferred Shares on such
record date, less the fair market value (as determined in good faith by the
Board of Trustees of the Company, whose determination shall be described in
a statement filed with the Rights Agent) of the portion of the evidences
of indebtedness or assets so to be distributed or of such subscription
rights 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 Company to be issued upon exercise of
one Right, or if Common Shares of the Company shall be issuable $0.01 per
share. Such adjustments shall be made successively whenever such a record
date is fixed; and in the event that such a 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 arket 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 (as such term is hereinafter defined) immediately
prior to such date; provided, however, that in the event that the current
per share market price of the Security is determined during a period
following the 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
reclassification, 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 American or New York Stock Exchange or, if the Security is not
listed or admitted to trading on the American or 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 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 of Trustees of
the Company. 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). 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) (appropriately adjusted to reflect any split, dividend or
similar transaction occurring after the date hereof), multiplied by one
hundred. If neither the Common Shares nor the Preferred Shares are
publicly held or so traded, "current per share market price" shall mean the
fair value per share as determined in good faith by the Board of Trustees
of the Company, whose determination shall be described in a statement filed
with the Rights Agent.
(e) No adjustment in the Purchase Price shall be required unless
such adjustment would require an increase or decrease of at least l% 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 and Section 13 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 and Section 13 shall be made no later than the earlier of (i)
three years from the date of the transaction which requires such adjustment
or (ii) the date of the expiration of the right to exercise any Rights.
(f) If as a result of an adjustment made pursuant to Section
11(a) or Section 13(a) hereof, the holder of any Right thereafter exercised
shall become entitled to receive any shares of capital stock of the Company
other than Preferred Shares, thereafter the number of such other shares so
receivable upon exercise of any Right (as well as any consideration to be
paid therefor) 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),
inclusive, and the provisions of Sections 7, 9, 10 and 13 with respect to
the Preferred Shares shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to
any adjustment made to the Purchase Price hereunder shall evidence the
right to purchase, at the adjusted Purchase Price, the number of one one-
hundredths of a Preferred Share purchasable from time to time hereunder
upon exercise of the Rights, all subject to further adjustment as provided
herein.
(h) Unless the Company shall have exercised its election as pro-
vided in Section 11(i), upon each adjustment of the Purchase Price as a
result of the calculations made in Sections 11(b) and (c), each Right
outstanding immediately prior to the making of such adjustment shall there-
after evidence the right to purchase, at the adjusted Purchase Price, that
number of one one-hundredths of a Preferred Share (calculated to the
nearest one one-millionth of a Preferred Share) obtained by (i)
multiplying (x) the number of one one-hundredths of a share covered by a
Right immediately prior to this adjustment by (y) the Purchase Price in
effect immediately prior to such adjustment of the Purchase Price and
(ii) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any adjustment
of the Purchase Price to adjust the number of Rights, in substitution for
any adjustment in the number of one one-hundredths 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-hundredths 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 Company shall make a public announce-
ment 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(i), the Company shall, as promptly as practicable, cause to be
distributed to holders of record of Right Certificates on such record date
Right Certificates evidencing, subject to Section 14 hereof, the additional
Rights to which such holders shall be entitled as a result of such
adjustment, or, at the option of the Company, shall cause to be distri-
buted to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of adjustment,
and upon surrender thereof, if required by the Company, new Right
Certificates evidencing all the Rights to which such holders shall be
entitled after such adjustment. Right Certificates so to be distributed
shall be issued, executed and countersigned in the manner provided for
herein and shall be registered in the names of the holders of record of
Right Certificates on the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase
Price or the number of one one-hundredths 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-hundredths of a Preferred Share which were expressed in the
initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an adjustment
reducing the Purchase Price below one one-hundredth of the then par value,
if any, of the Preferred Shares issuable upon exercise of the Rights, the
Company shall take any corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and legally
issue fully paid and nonassessable Preferred Shares at such adjusted
Purchase Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for
a specified event, the Company may elect to defer until the occurrence of
such event the issuing to the holder of any Right exercised after such
record date of the Preferred Shares and other capital stock or securities
of the Company, if any, issuable upon such exercise over and above the
Preferred Shares and other capital stock or securities of the Company, if
any, issuable upon such exercise on the basis of the Purchase Price in
effect prior to such adjustment; provided, however, that the Company
shall deliver to such holder a due bill or other appropriate instrument
evidencing such holder's right to receive such additional shares upon
the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding,
the Company shall be entitled to make such reductions in the Purchase
Price, in addition to those adjustments expressly required by this Section
11, as and to the extent that it in its sole discretion shall determine to
be advisable in order that any consolidation or subdivision of the
Preferred Shares, issuance wholly for cash of any Preferred Shares at less
than the current market price, issuance wholly for cash of Preferred Shares
or securities which by their terms are convertible into or exchangeable
for Preferred Shares, dividends on Preferred Shares payable in Preferred
Shares or issuance of rights, options or warrants referred to
hereinabove in Section 11(b), hereafter made by the Company to holders of
its Preferred Shares shall not be taxable to such shareholders.
(n) In the event that at any time after the date of this Agree-
ment and prior to the Distribution Date, the Company 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 (A) the number of one one-hundredths of a Preferred Share purchas-
able after such event upon proper exercise of each Right shall be
determined by multiplying the number of one one-hundredths of a
Preferred Share so purchasable immediately prior to such event by a
fraction, the numerator of which is the number of Common Shares outstanding
immediately before such event and the denominator of which is the number of
Common Shares outstanding immediately after such event, and (B) each Common
Share outstanding immediately after such event shall have issued with
respect to it that number of Rights which each Common Share outstanding
immediately prior to such event had issued with respect to it. The adjust-
ments provided for in this Section 11(n) shall be made successively
whenever such a dividend is declared or paid or such a subdivision,
combination or consolidation is effected.
(o) The Company covenants and agrees that, after the
Distribution Date, it shall not take or suffer any Subsidiary to take any
action which will, or is intended to, or which is reasonably foreseeable
to, diminish substantially or otherwise eliminate the benefits intended to
be afforded by the Rights, except as permitted by Section 23 or Section 27
hereof (it being understood that the issuance of additional Rights shall
not be deemed to violate this Section 11(o)).
Section 12. Certificate of Adjusted Purchase Price or Number of
Shares. Whenever an adjustment is made as provided in Section 11 or 13 hereof,
the Company shall promptly (a) prepare a certificate setting forth such
adjustment, and a brief statement of the facts accounting for such adjustment,
(b) file with the Rights Agent and with each transfer agent for the Common
Shares or the Preferred Shares a copy of such certificate and (c) if Right
Certificates have been issued, mail a brief summary thereof to each holder of a
Right Certificate in accordance with Section 26 hereof.
Section 13. Consolidation, Merger, Share Exchange or Sale or Transfer
of Assets or Earning Power.
(a) In the event, directly or indirectly, at any time after a
Person has become an Acquiring Person, (i) the Company shall consolidate
with, or merge with and into, or be a party to any binding share exchange
with, any other Person, (ii) any Person shall consolidate with the Company,
or merge with and into the Company and the Company shall be the continuing
or surviving real estate investment trust of such merger and, in connection
with such merger, all or part of the Common Shares shall be changed into or
exchanged for stock or other securities of any other Person (or the
Company) or cash or any other property, or (iii) the Company shall sell or
otherwise transfer (or one or more of its Subsidiaries shall sell or other-
wise transfer), in one or more transactions, assets or earning power
aggregating 50% or more of the assets or earning power of the Company
and its Subsidiaries (taken as a whole) to any other Person other than
the Company or one or more of its wholly-owned Subsidiaries, then, and in
each such case, proper provision shall be made so that (w) each holder of a
Right (except as otherwise provided herein) shall thereafter have the
right to receive, upon the exercise thereof at a price equal to the then
current Purchase Price multiplied by the number of one one-hundredths of a
Preferred Share for which a Right is then exercisable, in accordance with
the terms of this Agreement and in lieu of Preferred Shares, such number of
validly authorized and issued, fully paid, nonassessable and freely
tradable Common Shares (not subject to any rights of redemption, repurchase
or first refusal) of the Flip-Over Entity as shall equal the result
obtained by (A) multiplying the then current Purchase Price by the number
of one one-hundredths of a Preferred Share for which a Right is then
exercisable and dividing that result by (B) 50% of the then current per
share market price of the Common Shares of the Flip-Over Entity
(determined pursuant to Section 11(d) hereof) on the date of consummation
of such consolidation, merger, share exchange, sale or transfer; (x) the
Flip-Over Entity shall thereafter be liable for, and shall assume, by
virtue of such consolidation, merger, share exchange, sale or transfer, all
the obligations and duties of the Company pursuant to this Agreement; (y)
the term "Company" shall thereafter be deemed to refer to such Flip-Over
Entity; and (z) such Flip-Over Entity shall take such steps in connection
with such consummation as may be necessary to assure that the provisions
hereof shall thereafter be applicable, as nearly as reasonably may be, in
relation to the Common Shares thereafter deliverable upon the exercise of
the Rights. The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other transfers.
(b) "Flip-Over Entity" shall mean: (i) in the case of any
consolidation, merger or share exchange referred to in clause (i) or (ii)
of Section 13(a) hereof, the resulting, surviving or acquiring Person, as
the case may be (which may be the Company) and (ii) in the case of any sale
or transfer referred to in clause (iii) 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.
(c) The Company shall not consummate any consolidation, merger,
share exchange, sale or transfer referred to in Section 13(a) hereof unless
(i) the Flip-Over Entity shall have immediately after such transaction a
sufficient number of 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 the Flip-Over Entity shall reserve
such number of shares for such purpose), (ii) the Company and the Flip-Over
Entity shall have executed and delivered to the Rights Agent a supplemental
agreement providing for the terms set forth in subsections (a) and (b) of
this Section 13, and further providing that, as soon as practicable after
the date of any such consolidation, merger, share exchange, sale or
transfer, the Flip-Over Entity shall prepare and file a registration
statement on an appropriate form under the Securities Act, and take such
action as shall be necessary under applicable state securities laws, with
respect to the Rights and the securities purchasable upon exercise of the
Rights, and will use its best efforts to cause such registration statement
and other action to become effective as soon as practicable after such
filing and remain effective (with a prospectus at all times meeting the re-
quirements of law) so long as any Rights may be exercised hereunder. The
Company shall not enter into any transaction referred to in Section 13(a)
hereof if at the time of such transaction there are any rights, warrants,
instruments or securities outstanding or any agreements or arrangements
which, as a result of the consummation of such transaction, would eliminate
or substantially diminish the benefits intended to be afforded by the
Rights.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue fractions of
Rights or to distribute Right Certificates which evidence fractional
Rights. If the Company elects not to issue fractional Rights, then in lieu
of such fractional Rights, there shall be paid to the registered holders of
the Rights 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 American or New York Stock Exchange or, if
the Rights are not listed or admitted to trading on the American or 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 of Trustees of the Company. 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 of Trustees of the Company shall
be used.
(b) The Company shall not be required to issue fractions of
Preferred Shares (other than fractions which are integral multiples of one
one-hundredth of a Preferred Share) upon exercise of the Rights or to dis-
tribute certificates which evidence fractional Preferred Shares (other than
fractions which are integral multiples of one one-hundredth of a Preferred
Share). Fractions of Preferred Shares in integral multiples of one one-
hundredth of a Preferred Share may, at the election of the Company, be
evidenced by depositary receipts, pursuant to an appropriate agreement
between the Company and a depositary selected by it; provided, that such
agreement shall provide that the holders of such depositary receipts
shall have all 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
integral multiples of one one-hundredth of a Preferred Share, the Company
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 Preferred Share. For the
purposes of this Section 14(b), the current market value of a Preferred
Share shall be the closing price of a Preferred Share (as determined pur-
suant to the second sentence of Section 11(d)(i) hereof) for the Trading
Day immediately prior to the date of such exercise.
(c) The holder of a Right by the acceptance of the Right
expressly waives his or her right to receive any fractional Rights or any
fractional shares upon exercise of a Right (except as provided above).
Section 15. Rights of Action. All rights of action in respect of
this Agreement, excepting 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 Company to enforce, or otherwise act in respect of, his right to
exercise the Rights evidenced by such Right Certificate 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 Company and the Rights Agent
and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be transfer-
able only in connection with the transfer of the Common Shares;
(b) after the Distribution Date, the Right Certificates are
transferable onlyon the registry books of the Rights Agent if surrendered at
the principal office of the Rights Agent, duly endorsed or accompanied by a
proper instrument of transfer; and
(c) the Company and the Rights Agent may deem and treat the
Person in whose name the Right Certificate is (or, prior to the Distribution
Date, the associated Common Shares are) registered as the absolute owner
thereof and of the Rights evidenced thereby (notwithstanding any notations
of ownership or writing on the Right Certificates or the associated Common
Shares certificate or any confirmation or advice with respect to
uncertificated Common Shares made by anyone other than the Company or the
Rights Agent) for all purposes whatsoever, and neither the Company nor the
Rights Agent shall be affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any
holder of a Right or any other Person as a result of its inability to
perform any of its obligations under this Agreement by reason of any
preliminary or permanent injunction or other order, decree or ruling issued
by a court of competent jurisdiction or by a governmental, regulatory or
administrative agency or commission, or any statute, rule, regulation or
executive order promulgated or enacted by any governmental authority
prohibiting or otherwise restraining performance of any such obligation.
Section 17. Right Holder Not Deemed a Shareholder. No holder, as
such, of any Right shall be entitled to vote, receive dividends or be deemed for
any purpose the holder of the Preferred Shares or any other securities of the
Company which may at any time be issuable on the exercise 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, as such, any of
the rights of a shareholder of the Company or any right to vote for the election
of trustees or upon any matter submitted to shareholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting shareholders (except as provided in
Section 25 hereof), or to receive dividends or subscription rights, or
otherwise, until such Right shall have been exercised or exchanged in accordance
with the provisions hereof.
Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from time to
time, on demand of the Rights Agent, its reasonable expenses and counsel
fees and other disbursements incurred in the administration and execution
of this Agreement and the exercise and performance of its duties hereunder.
The Company also agrees to indemnify the Rights Agent for, and to hold it
harmless against, any loss, liability, or expense, incurred without
negligence, bad faith or willful misconduct on the part of the Rights
Agent, for anything done or omitted by the Rights Agent in connection
with the acceptance and administration of this Agreement, including
the costs and expenses of defending against any claim of liability in the
premises.
(b) The Rights Agent shall be protected and shall incur no
liability for, or in respect of any action taken, suffered or omitted by it
in connection with, its administration of this Agreement in reliance upon
any Right Certificate or certificate for the Preferred Shares or Common
Shares or for other securities of the Company, instrument of assignment or
transfer, power of attorney, endorsement, affidavit, letter, notice,
direction, consent, certificate, statement, or other paper or document
believed by it to be genuine and to be signed, executed and, where
necessary, verified or acknowledged, by the proper person or persons, 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 corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the stock transfer or corporate trust powers 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 the 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 Rights Agent or in the name of the successor Rights Agent; and
in all such cases such Right Certificates shall have the full force pro-
vided 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 counter-
signature under its prior name and deliver Right Certificates so counter-
signed; 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 imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the holders of Right Certificates,
by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may be
legal counsel for the Company), and the opinion of such counsel shall be
full and complete authorization and protection to the Rights Agent as to
any action taken or omitted by it in good faith and in accordance with such
opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that any
fact or matter be proved or established by the Company prior to taking or
suffering any action hereunder, such fact or matter (unless other evidence
in respect thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by a certificate signed by any one of
the Chief Executive Officer, the President, any Vice President, the
Treasurer or the Secretary of the Company and delivered to the Rights
Agent; and such certificate shall be full authorization to the Rights
Agent for any action taken or suffered in good faith by it under the
provisions of this Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder to the Company
and any other Person only for its own negligence, bad faith, or willful
misconduct.
(d) The Rights Agent shall not be liable for or by reason of any
of the statements of fact or recitals contained in this Agreement or in the
Right Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be
deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery
hereof (except the due authorization execution and delivery hereof by the
Rights Agent) or in respect of the validity or execution of any Right
Certificate (except its countersignature thereof); nor shall it be
responsible for any breach by the Company of any covenant or condition
contained in this Agreement or in any Right Certificate; nor shall it be
responsible for any change in the exercisability of the Rights (includ-
ing the Rights becoming void pursuant to Section 11(a)(ii) hereof) or
any adjustment in the terms of the Rights (including the manner, method
or amount thereof) provided for in Section 3, 11, 13, 23 or 24, or the
ascertaining of the existence of facts that would require any such change
or adjustment (except with respect to the exercise of Rights evidenced by
Right Certificates after receipt of the certificate contemplated by Section
12 hereof describing such change or 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, as
the case may be) to be issued pursuant to this Agreement or any Right
Certificate or as to whether any Preferred Shares (or Common Shares, as the
case may be) will, when issued, be validly authorized and issued, fully
paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged
and delivered all such further and other acts, instruments and assurances
as may reasonably be required by the Rights Agent for the carrying out or
performing by the Rights Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from
any one of the Chief Executive Officer, the President, any Vice President,
the Secretary or the Treasurer of the Company, and to apply to such
officers for advice or instructions in connection with its duties, and it
shall not be liable for any action taken or suffered by it in good faith in
accordance with instructions of any such officer or for any delay in acting
while waiting for those instructions.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or
lend money to the Company or otherwise act as fully and freely as though it
were not Rights Agent under this Agreement. Nothing herein shall preclude
the Rights Agent from acting in any other capacity for the Company or for
any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights
or powers hereby vested in it or perform any duty hereunder either itself
or by or through its attorneys or agents, and the Rights Agent 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 Company resulting from
any such act, default, neglect or misconduct, provided reasonable care was
exercised in the selection and continued employment thereof.
(j) If, with respect to any Right 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, the Rights
Agent shall not take any further action with respect to such requested
exercise or transfer without direction from the Company.
Section 21. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Agreement
upon 30 days' notice in writing mailed to the Company and to each transfer agent
of the Common Shares and Preferred Shares by registered or certified mail, and,
in the case of a resignation after the Distribution Date, to the holders of the
Right Certificates in accordance with Section 26 hereof. The Company may remove
the Rights Agent or any successor Rights Agent upon 30 days' notice in writing,
mailed to the Rights Agent or successor Rights Agent, as the case may be, and to
each transfer agent of the Common Shares and Preferred Shares by registered or
certified mail, and, in the case of a removal after the Distribution Date, to
the holders of the Right Certificates in accordance with Section 26 hereof. If
the Rights Agent shall resign or be removed or shall otherwise become incapable
of acting, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of 30 days after
giving notice of such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights Agent or by
the holder of a Right Certificate (which holder shall, with such notice, submit
his Right Certificate for inspection by the Company), then the registered holder
of any Right Certificate may apply to any court of competent jurisdiction for
the appointment of a new Rights Agent. Any successor Rights Agent, whether
appointed by the Company or by such a court, shall be a corporation organized
and doing business under the laws of the United States or of the State of New
York or State of Maryland (or of any other state of the United States so long as
such corporation is authorized to do business as a banking institution in the
State of New York or State of Maryland), in good standing, having an office in
the State of New York or State of Maryland, 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 million. After appointment, the successor Rights Agent shall be
vested with the same powers, rights, duties and responsibilities as if it had
been originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment the Company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Shares and Preferred Shares, and, in the case of an appointment after
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
Company may, at its option, issue new Right Certificates evidencing Rights in
such form as may be approved by its Board of Trustees to reflect any adjustment
or change in the Purchase Price or 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.
(a) The Board of Trustees of the Company may, at its option,
at any time prior to such time as any Person becomes an Acquiring Person,
redeem all but not less than all the then outstanding Rights at a
redemption price of $0.001 per Right, appropriately adjusted to reflect any
split, dividend or similar transaction occurring after the date hereof
(such redemption price being hereinafter referred to as the "Redemption
Price"). The redemption of the Rights by the Board of Trustees may be made
effective at such time, on such basis and with such conditions as the Board
of Trustees in its sole discretion may establish.
(b) Immediately upon the action of the Board of Trustees of the
Company ordering the redemption of the Rights pursuant to paragraph (a) of
this Section 23, 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. The
Company shall promptly give public notice of any such redemption; 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
action of the Board of Trustees ordering the redemption of the Rights, the
Company 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 Company 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.
Section 24. Exchange.
(a) The Board of Trustees of the Company 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 void pursuant to the provisions of Section
11(a)(ii) hereof) for Common Shares at an exchange ratio of one Common
Share per Right, appropriately adjusted to reflect any split, 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 of Trustees shall not be empowered to effect such
exchange at any time after any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the Company or
any such Subsidiary, or any entity holding Common Shares for or pursuant
to the terms of any such plan), together with all Affiliates and
Associates of such Person, becomes the Beneficial Owner of 50% or more of
the Common Shares then outstanding.
(b) Immediately upon the action of the Board of Trustees of the
Company ordering the exchange of any Rights pursuant to paragraph (a) of
this Section 24 and without any further action and without any notice, the
right to exercise such Rights shall terminate and the only right thereafter
of a holder of such Rights shall be to receive that number of Common Shares
equal to the number of such Rights held by such holder multiplied by the
Exchange Ratio. The Company shall promptly give public notice 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 Company
promptly shall mail a notice of any such exchange to all of the holders
of such Rights in accordance with Section 26 hereof. 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 11(a)(ii) hereof) held by each holder
of Rights.
(c) In the event that there shall not be sufficient Common
Shares issued but not outstanding or authorized but unissued to permit any
exchange of Rights as contemplated in accordance with this Section 24, the
Company shall take all such action as may be necessary to authorize
additional Common Shares for issuance upon exchange of the Rights. In the
event the Company shall, after good faith effort, be unable to take all
such action as may be necessary to authorize such additional Common Shares,
the Company shall substitute, for each Common Share that would otherwise be
issuable upon exchange of a Right, a number of Preferred Shares or
fraction thereof such that the current per share market price of one
Preferred Share multiplied by such number or fraction is equal to the
current per share market price of one Common Share as of the date of
issuance of such Preferred Shares or fraction thereof.
(d) The Company shall not be required to issue fractions of
Common Shares or to distribute certificates which evidence fractional
Common Shares upon any exchange of Rights as contemplated in accordance
with this Section 24 or upon any exercise of Rights as contemplated in
accordance with Section 11(a)(ii) hereof. In lieu of such fractional
Common Shares, the Company shall pay to the registered holders of the
Right Certificates with regard to which such fractional Common Shares
would otherwise be issuable an amount in cash equal to the same
fraction of the current market value of a whole Common Share. For the
purposes of this paragraph (d), the current market value of a whole Common
Share shall be the closing price of a Common Share (as determined pursuant
to the second sentence of Section 11(d)(i) hereof) for the Trading Day
immediately prior to the date of exchange pursuant to this Section 24 or
the date of exercise pursuant to Section 11(a)(ii) hereof.
Section 25. Notice of Certain Events.
(a) In case the Company shall propose (i) to pay any dividend
payable in beneficial interests 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 regular periodic 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
beneficial interest 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 of out-
standing Preferred Shares), (iv) to effect any consolidation or merger
into or with, or to effect any sale or other transfer (or to permit one or
more of its Subsidiaries to effect any sale or other transfer), in one or
more transactions, of 50% or more of the assets or earning power of the
Company and its Subsidiaries (taken as a whole) to, any other Person, (v)
to effect the liquidation, dissolution or winding up of the Company, or
(vi) to declare or pay any dividend on the Common Shares payable in Common
Shares or to effect a subdivision, combination or consolidation of the
Common Shares (by reclassification or otherwise than by payment of
dividends in Common Shares), then, in each such case, the Company shall
give to each holder of a Right Certificate, in accordance with Section 26
hereof, a notice of such proposed action, which shall specify the record
date for the purposes of such dividend, or distribution 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 Common
Shares and/or 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 10 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 10 days prior to the
date of the taking of such proposed action or the date of participation
therein by the holders of the Common Shares and/or Preferred Shares,
whichever shall be the earlier.
(b) In case the event set forth in Section 11(a)(ii) hereof
shall occur, then the Company 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.
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 Company shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed (until another address is filed in
writing with the Rights Agent) as follows:
Crown American Realty Trust
Pasquerilla Plaza
Johnstown, PA 15901
Attn: Chief Executive Officer
Subject to the provisions of Section 21 hereof, any notice or demand
authorized by this Agreement to be given or made by the Company or by the holder
of any Right Certificate to or on the Rights Agent shall be sufficiently given
or made if sent by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Company) as follows:
American Stock Transfer and Trust Company
40 Wall Street
46th Floor
New York, New York 10005
Attn: Transfer Department
Notices or demands authorized by this Agreement to be given or made by
the Company or the Rights Agent to the holder of any Right 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
Rights Agent or, prior to the Distribution Date, on the registry books of the
transfer agent for the Common Shares. Any notice to the holder of a Right which
is mailed in the manner herein provided shall be deemed effective when so
mailed, whether or not the holder receives the notice; any notice to the Company
or to the Rights Agent shall be deemed effective if and when received.
Section 27. Supplements and Amendments. The Company may from time to
time supplement or amend this Agreement without the approval of any holders of
any Right in order to cure any ambiguity, to correct or supplement any provision
contained herein which may be defective or inconsistent with any other
provisions herein, or to make any other provisions with respect to the Rights
which the Company may deem necessary or desirable, any such supplement or
amendment to be evidenced by a writing signed by the Company and the Rights
Agent; provided, however, that from and after such time as any Person becomes an
Acquiring Person, this Agreement shall not be amended in any manner which would
adversely affect the interests of the holders of Rights. Without limiting the
foregoing, the Company may at any time prior to such time as any Person becomes
an Acquiring Person amend this Agreement to lower the thresholds set forth in
Sections 1(a) and 3(a) to not less than the greater of (i) the sum of .001% and
the largest percentage of the outstanding Common Shares then known by the
Company to be beneficially owned by any Person (other than the Company or any
Related Entity) and (ii) 10%. Upon the delivery of a certificate from an
appropriate officer of the Company which states that a proposed supplement or
amendment is in compliance with the terms of this Section 27, the Rights Agent
shall execute such supplement or amendment.
Section 28. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
Section 29. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any Person other than the Company, the Rights
Agent and the registered holders of the 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 Company, the Rights Agent and the registered holders of
the Right Certificates (and, prior to the Distribution Date, the Common Shares).
Section 30. Severability. If any term, provision, covenant or re-
striction 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 31. Governing Law. This Agreement and each Right issued
hereunder shall be deemed to be a contract made under the laws of the State of
Maryland and for all purposes shall be governed by and construed in accordance
with the laws of such State applicable to contracts to be made and performed
entirely within such State.
Section 32. Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.
Section 33. Descriptive Headings. Descriptive headings of the
several Sections of this Agreement are inserted for convenience only and shall
not control or affect the meaning or construction of any of the provisions
hereof.
Section 34. Beneficial Interests. All references herein to "stock",
"capital", "capital stock", "shares", "preferred shares", and "common shares",
and the like, of the Company shall be deemed to be references to the Company's
Beneficial Interests, common and preferred, as applicable.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and attested, all as of the day and year first above written.
[Corporate Seal] CROWN AMERICAN REALTY TRUST
Attest:
By /s/Ronald P. Rusink By /s/Mark E. Pasquerilla
Ronald P. Rusinak, Vice President Mark E. Pasquerilla, President and
General Counsel and Secretary Chief Executive Officer
Attest: AMERICAN STOCK TRANSFER AND
TRUST COMPANY
By By
Authorized Signatory Authorized Signatory
EXHIBIT A
FORM OF
ARTICLES SUPPLEMENTARY RELATING TO
DESIGNATION, PREFERENCES AND RIGHTS OF
SERIES A JUNIOR PARTICIPATING PREFERRED SHARES OF BENEFICIAL INTEREST
OF
CROWN AMERICAN REALTY TRUST
In compliance with the requirements of Section 8-203 of the Maryland
General Corporation Law, as amended (the "MGCL"), the undersigned company, a
real estate investment trust organized and existing under the MGCL (the
"Company") hereby certifies that:
1. The name of the Company is Crown American Realty Trust.
2. The resolution duly adopted by the Board of Trustees of the
Company establishing and designating the Series A Junior Participating Preferred
Shares of Beneficial Interest, which is the second series of the Preferred
Shares of Beneficial Interest, par value $0.01 per share, of the Company, and
fixing and determining the relative rights and preferences thereof (the
"Resolution") is as follows:
RESOLVED, that this Board of Trustees, pursuant to authority expressly
vested on it by the provisions of the Second Amended and Restated Declaration of
Trust, as amended, ("Declaration of Trust") of Crown American Realty Trust
(hereinafter called the "Company") hereby authorizes the issue of the second
series of Preferred Shares of Beneficial Interest, par value $0.01 per share, of
the Company and hereby fixes the designation and relative rights and preferences
thereof in addition to those set forth in said Declaration of Trust as follows:
Section 1. Designation and Amount. The shares of such series shall
be designated as "Series A Junior Participating Preferred Shares of Beneficial
Interest" (the "Series A Preferred Shares of Beneficial Interest") and the
number of shares constituting the Series A Preferred Shares of Beneficial
Interest shall be 1,750,000. Such number of shares may be increased or
decreased by resolution of the Board of Trustees; provided, that no decrease
shall reduce the number of shares of Series A Preferred Shares of Beneficial
Interest to a number less than the number of shares then outstanding plus the
number of shares reserved for issuance upon the exercise of outstanding options,
rights or warrants or upon the conversion of any outstanding securities issued
by the Company convertible into Series A Preferred Shares of Beneficial
Interest.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any series
of Preferred Shares of Beneficial Interest (or any similar beneficial interest)
ranking prior and superior to the Series A Preferred Shares of Beneficial
Interest with respect to dividends, the holders of shares of Series A Preferred
Shares of Beneficial Interest, in preference to the holders of the Common Shares
of Beneficial Interest, par value $0.01 (the "Common Shares"), of the Company,
and of any other junior beneficial interest, shall be entitled to receive, when,
as and if declared by the Board of Trustees out of funds legally available for
the purpose, quarterly dividends payable in cash on the dates, if any, that
quarterly dividends are normally paid to holders of the Common Shares (each date
of such dividend being referred to herein as a "Dividend Payment Date"),
commencing on the first Dividend Payment Date after the first issuance of a
share or fraction of a share of Series A Preferred Shares of Beneficial Interest
and only upon payment of a dividend to holders of the Common Shares, in an
amount per share (rounded to the nearest cent) equal to the greater of (a) $1 or
(b) subject to the provision for adjustment hereinafter set forth, 100 times the
aggregate per share amount of all cash dividends, and 100 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 the Company's Common
Shares or a subdivision of the outstanding shares of the Company's Common Shares
(by reclassification or otherwise), declared on the Common Shares since the
immediately preceding Dividend Payment Date or, with respect to the first
Dividend Payment Date, since the first issuance of any share or fraction of a
share of Series A Preferred Shares of Beneficial Interest. In the event the
Company shall at any time declare or pay any dividend on the Common Shares
payable in shares of the Company's Common Shares, or effect a subdivision or
combination or consolidation of the outstanding shares of the Company's Common
Stock (by reclassification or otherwise than by payment of a dividend in shares
of the Company's Common Shares) into a greater or lesser number of shares of the
Company's Common Shares, then in each such case the amount to which holders of
shares of Series A Preferred Shares of Beneficial Interest 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 the Company's Common Shares outstanding immediately
after such event and the denominator of which is the number of shares of the
Company's Common Shares that were outstanding immediately prior to such event.
(B) The Company shall declare a dividend or distribution on the
Series A Preferred Shares of Beneficial Interest as provided in paragraph (A) of
this Section immediately after it declares a dividend or distribution on the
Common Shares (other than a dividend payable in shares of the Company's Common
Shares); provided that, in the event no dividend or distribution shall have been
declared on the Common Shares during the period between any Dividend Payment
Date and the next subsequent Dividend Payment Date, a dividend of $1 per share
on the Series A Preferred Shares of Beneficial Interest shall nevertheless be
payable on such subsequent Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Preferred Shares of Beneficial Interest from the Dividend
Payment Date next preceding the date of issue of such shares, unless the date of
issue of such shares is prior to the record date for the first Dividend Payment
Date, in which case dividends on such shares shall begin to accrue from the date
of issue of such shares, or unless the date of issue is a Dividend Payment Date
or is a date after the record date for the determination of holders of shares of
Series A Preferred Shares of Beneficial Interest entitled to receive a dividend
and before such Dividend Payment Date, in either of which events such dividends
shall begin to accrue and be cumulative from such Dividend Payment Date.
Accrued but unpaid dividends shall not bear interest. Dividends paid on the
shares of Series A Preferred Shares of Beneficial Interest 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 Trustees may fix a record date for
the determination of holders of shares of Series A Preferred Shares of
Beneficial Interest 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. The holders of shares of Series A
Preferred Shares of Beneficial Interest shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Preferred Shares of Beneficial Interest shall entitle the
holder thereof to 100 votes on all matters submitted to a vote of the
shareholders of the Company. In the event the Company shall at any time declare
or pay any dividend on the Common Shares payable in shares of the Company's
Common Shares, or effect a subdivision or combination or consolidation of the
outstanding shares of the Company's Common Shares (by reclassification or
otherwise than by payment of a dividend in shares of the Company's Common
Shares) into a greater or lesser number of shares of the Company's Common
Shares, then in each such case the number of votes per share to which holders of
shares of Series A Preferred Shares of Beneficial Interest 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 the Company's
Common Shares outstanding immediately after such event and the denominator of
which is the number of shares of the Company's Common Shares that were
outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in any Articles
Supplementary creating a series of Preferred Shares of Beneficial Interest or
any similar beneficial interest, or in any By-Law, the holders of shares of
Series A Preferred Shares of Beneficial Interest and the holders of shares of
the Company's Common Shares and any other capital stock of the Company having
general voting rights shall vote together as one class on all matters submitted
to a vote of shareholders of the Company.
(C) Except as set forth herein, or as otherwise provided by law,
holders of Series A Preferred Shares of Beneficial Interest shall have no
special voting rights and their consent shall not be required (except to the
extent they are entitled to vote with holders of Common Shares as set forth
herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever dividends or distributions payable on the Series A
Preferred Shares of Beneficial Interest as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and distributions, whether
or not declared, on shares of Series A Preferred Shares of Beneficial Interest
outstanding shall have been paid in full, the Company shall not:
(i) declare or pay dividends, or make any other distributions, on any
shares of beneficial interest ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series A Preferred
Shares of Beneficial Interest;
(ii) declare or pay dividends, or make any other distributions, on
any shares of beneficial interest ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the Series A
Preferred Shares of Beneficial Interest, except dividends paid ratably on
the Series A Preferred Shares of Beneficial Interest and all such parity
beneficial interest on which dividends are payable or in arrears in
proportion to the total amounts to which the holders of all such shares are
then entitled;
(iii) redeem or purchase or otherwise acquire for consideration
shares of any beneficial interest ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series A Preferred
Shares of Beneficial Interest, provided that the Company may at any time
redeem, purchase or otherwise acquire shares of any such junior beneficial
interest in exchange for shares of any beneficial interest of the Company
ranking junior (either as to dividends or upon dissolution, liquidation or
winding up) to the Series A Preferred Shares of Beneficial Interest; or
(iv) redeem or purchase or otherwise acquire for consideration any
shares of Series A Preferred Shares of Beneficial Interest, or any shares
of beneficial interest ranking on a parity with the Series A Preferred
Shares of Beneficial Interest, except in accordance with a purchase offer
made in writing or by publication (as determined by the Board of Trustees)
to all holders of such shares upon such terms as the Board of Trustees,
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 Company shall not permit any subsidiary of the Company to
purchase or otherwise acquire for consideration any shares of beneficial
interest of the Company unless the Company could, under paragraph (A) of this
Section 4, purchase or otherwise acquire such shares at such time and in such
manner.
Section 5. Re-acquired Shares. Any shares of Series A Preferred
Shares of Beneficial Interest purchased or otherwise acquired by the Company in
any manner whatsoever shall be retired and canceled promptly after the
acquisition thereof. All such shares shall upon their cancellation become
authorized but unissued shares of Preferred Shares of Beneficial Interest and
may be reissued as part of a new series of Preferred Shares of Beneficial
Interest subject to the conditions and restrictions on issuance set forth
herein, in the Declaration of Trust or in any other Articles Supplementary
creating a series of Preferred Shares of Beneficial Interest or any similar
beneficial interest or as otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Company, no distribution shall be
made (1) to the holders of shares of beneficial interest ranking junior (either
as to dividends or upon liquidation, dissolution or winding up) to the Series A
Preferred Shares of Beneficial Interest unless, prior thereto, the holders of
shares of Series A Preferred Shares of Beneficial Interest shall have received
$100 per share, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such payment,
provided that the holders of shares of Series A Preferred Shares of Beneficial
Interest shall be entitled to receive an aggregate amount per share, subject to
the provision for adjustment hereinafter set forth, equal to 100 times the
aggregate amount to be distributed per share to holders of shares of the
Company's Common Shares or (2) to the holders of shares of beneficial interest
ranking on a parity (either as to dividends or upon liquidation, dissolution or
winding up) with the Series A Preferred Shares of Beneficial Interest, except
distributions made ratably on the Series A Preferred Shares of Beneficial
Interest and all such parity beneficial interest in proportion to the total
amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. In the event the Company shall at any
time declare or pay any dividend on the Common Shares payable in shares of the
Company's Common Shares, or effect a subdivision or combination or consolidation
of the outstanding shares of the Company's Common Shares (by reclassification or
otherwise than by payment of a dividend in shares of the Company's Common
Shares) into a greater or lesser number of shares of the Company's Common
Shares, then in each such case the aggregate amount to which holders of shares
of Series A Preferred Shares of Beneficial Interest were entitled immediately
prior to such event under the proviso in clause (1) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction the numerator of
which is the number of shares of the Company's Common Shares outstanding
immediately after such event and the denominator of which is the number of
shares of the Company's Common Shares that were outstanding immediately prior to
such event.
Section 7. Consolidation, Merger, etc. In case the Company shall
enter into any consolidation, merger, combination or other transaction in which
the shares of the Company's Common Shares are exchanged for or changed into
other beneficial interest or securities, cash and/or any other property, then in
any such case each share of Series A Preferred Shares of Beneficial Interest
shall at the same time be similarly exchanged or changed into an amount per
share, subject to the provision for adjustment hereinafter set forth, equal to
100 times the aggregate amount of beneficial interest, securities, cash and/or
any other property (payable in kind), as the case may be, into which or for
which each share of the Company's Common Shares is changed or exchanged. In the
event the Company shall at any time declare or pay any dividend on the Common
Shares payable in shares of the Company's Common Shares, or effect a subdivision
or combination or consolidation of the outstanding shares of the Company's
Common Shares (by reclassification or otherwise than by payment of a dividend in
shares of the Company's Common Shares) into a greater or lesser number of shares
of the Company's Common 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 Shares of Beneficial Interest shall be adjusted by
multiplying such amount by a fraction, the numerator of which is the number of
shares of the Company's Common Shares outstanding immediately after such event
and the denominator of which is the number of shares of the Company's Common
Shares that were outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series A Preferred Shares of
Beneficial Interest shall not be redeemable.
Section 9. Rank. Except as otherwise set forth in the Declaration of
Trust or in the Articles Supplementary creating another series of Preferred
Shares of Beneficial Interest or any other class or series of beneficial
interest, the Series A Preferred Shares of Beneficial Interest shall rank, with
respect to the payment of dividends and the distribution of assets, junior to
all other series of the Company's Preferred Shares of Beneficial Interest and to
any other class or series of beneficial interest other than the Common Shares,
whether now existing or hereafter created.
Section 10. Amendment. The Declaration of Trust of the Company shall
not be amended in any manner which would materially alter or change the powers,
preferences or special rights of the Series A Preferred Shares of Beneficial
Interest so as to affect them adversely without a majority vote of the
outstanding shares of Series A Preferred Shares of Beneficial Interest, voting
together as a single class.
3. (i) The aggregate number of shares of the Series A Preferred
Shares of Beneficial Interest established and designated by the Resolution is
1,750,000; (ii) on July 3, 1997, the Company filed Articles Supplementary
establishing and designating up to 2,875,000 Preferred Shares, par value $0.01
per share, as a series of 11.00% Senior Preferred Shares, par value $0.01 per
share, pursuant to Section 8-203 of the MGCL; and (iii) the aggregate number of
shares established and designated by the Declaration of Trust of the Company is
250,000,000, of which 5,000,000 shares are Preferred Shares of Beneficial
Interest, par value $0.01 per share, issuable in one or more series, 120,000,000
shares are Common Shares of Beneficial Interest, par value $0.01 per share, and
125,000,000 shares are Excess Shares of Beneficial Interest, par value $0.01 per
share.
4. The Resolution was duly adopted at a special meeting of the Board
of Trustees of the Company duly called and held on January 20, 2000, at which
meeting a quorum was present and acted throughout.
5. The Resolution is to be effective upon the filing of Articles
Supplementary Relating to Series A Junior Participating Preferred Shares of
Beneficial Interest with the State of Maryland.
IN WITNESS WHEREOF, these Articles Supplementary Relating to Series A
Junior Participating Preferred Shares of Beneficial Interest is executed on
behalf of the Company by its President and Chief Executive Officer and attested
by its Secretary this 20th day of January, 2000.
[CORPORATE SEAL]
Attest: CROWN AMERICAN REALTY TRUST
By By
Ronald P. Rusinak, Vice President, Mark E. Pasquerilla, President and
General Counsel and Secretary Chief Executive Officer
EXHIBIT B
FORM OF
RIGHT CERTIFICATE
Certificate No. R- Rights
NOT EXERCISABLE AFTER JANUARY 20, 2010 OR EARLIER IF REDEMPTION OR
EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $0.001 PER
RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.
UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS
WHICH ARE BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR AN AFFILIATE OR
ASSOCIATE THEREOF (EACH AS DEFINED IN THE RIGHTS AGREEMENT) WILL
BECOME NULL AND VOID.
Right Certificate
CROWN AMERICAN REALTY TRUST
This certifies that , or registered assigns, is
the registered owner of the number of Rights set forth above, each of which
entitles the owner thereof, subject to the terms, provisions and conditions of
the Rights Agreement, dated January 20, 2000 (the "Rights Agreement"), between
Crown American Realty Trust, a Maryland real estate investment trust (the
"Company"), and American Stock Transfer and Trust Company (the "Rights Agent"),
to purchase from the Company at any time after the Distribution Date (as such
term is defined in the Rights Agreement) and prior to 5:00 P.M., local time in
New York, New York, on February 4, 2000 at the principal office of the Rights
Agent, or at the office of its successor as Rights Agent, one one-hundredth of a
fully paid and non-assessable share of Series A Junior Participating Preferred
Shares of Beneficial Interest, par value $0.01 per share (the "Preferred
Shares"), of the Company, at a purchase price of $20.00 per one one-hundredth of
a Preferred Share (the "Purchase Price"), upon presentation and surrender of
this Right Certificate with the Form of Election to Purchase duly executed. The
number of Rights evidenced by this Right Certificate (and the number of one one-
hundredths 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 February 4, 2000, based on the Preferred Shares as constituted at
such date. As provided in the Rights Agreement, the Purchase Price and the
number of one one-hundredths of a Preferred Share 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, and in certain
circumstances specified in the Rights Agreement, shares of Common Shares of
Beneficial Interest, par value $0.01, of the Company may be purchased in lieu of
one one-hundredths of a Preferred Share.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the Rights Agreement are on file at the principal offices of the Company and the
Rights Agent.
This Right Certificate, with or without other Right Certificates, upon
surrender at the principal office of the Rights Agent, may be exchanged for
another Right Certificate or Right Certificates of like tenor and date
evidencing Rights entitling the holder to purchase a like aggregate number of
Preferred Shares as the Rights evidenced by the Right Certificate or Right
Certificates surrendered shall have entitled such holder to purchase. If this
Right Certificate shall be exercised in part, the holder shall be entitled to
receive upon surrender hereof another Right Certificate or Right Certificates
for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Certificate (i) may be redeemed by the Company at a redemption
price of $0.001 per Right or (ii) may be required to be exchanged in whole or in
part for shares of the Company's Common Shares, par value $0.01, or Preferred
Shares.
No fractional shares will be issued upon the exercise of any Right or
Rights evidenced hereby (other than fractions which are integral multiples of
one one-hundredth of a Preferred Share, which may, at the election of the
Company, 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, as such, shall be entitled to
vote or receive dividends or be deemed for any purpose the holder of Preferred
Shares or of any other securities of the Company which may at any time be
issuable on the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any
of the rights of a shareholder of the Company or any right to vote for the
election of trustees or upon any matter submitted to shareholders at any meeting
thereof, or to give or withhold consent to any corporate action, or to receive
notice of meetings or other actions affecting shareholders (except as provided
in the Rights Agreement), or to receive dividends or subscription rights, or
otherwise, until the Right or Rights evidenced by this Right Certificate shall
have been exercised as provided in the Rights Agreement.
This Right Certificate shall not be 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 Company
and its corporate seal this day of , 20 .
[Corporate Seal]
Attest: CROWN AMERICAN REALTY TRUST
By By
Ronald P. Rusinak, Vice President, Mark E. Pasquerilla, President and
General Counsel and Secretary Chief Executive Officer
Countersigned:
AMERICAN STOCK TRANSFER AND
TRUST COMPANY
By:
Name:
Title:
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR VALUE RECEIVED hereby sells, assigns and
transfers unto
(Please print name and address of transferee)
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint Attorney, to
transfer the within Right Certificate on the books of the within-named Company,
with full power of substitution.
Dated:
Signature
SIGNATURE GUARANTEED:
Signatures must be guaranteed by an eligible guarantor institution (a
bank, stockbroker, savings and loan association, or credit union with membership
in an approved guarantee medallion program) pursuant to Rule 17Ad-15 of the
Securities Exchange Act of 1934.
CERTIFICATE
The undersigned hereby certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).
Signature
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise
Rights represented by the Right Certificate.)
To: CROWN AMERICAN REALTY TRUST
The undersigned hereby irrevocably elects to exercise
Rights represented by this Right Certificate to purchase the Preferred Shares
(or other securities) issuable or deliverable upon the exercise of such Rights
and requests that certificates for such Preferred Shares (or other securities)
be issued in the name of and delivered to:
(Please print name and address)
Social Security or Other Tax Payer Identification Number:
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 print name and address)
Social Security or Other Tax Payer Identification Number:
Dated:
Signature
SIGNATURE GUARANTEED:
Signatures must be guaranteed by an eligible guarantor institution (a
bank, stockbroker, savings and loan association, or credit union with membership
in an approved guarantee medallion program) pursuant to Rule 17Ad-15 of the
Securities Exchange Act of 1934.
CERTIFICATE
The undersigned hereby certifies that the Rights evidenced by this
Right Certificate are not beneficially owned by an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement).
Signature
NOTICE
The signature in the Form of Assignment or Form of Election to
Purchase, as the case may be, 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 Certificate set forth above in the Form of Assignment
or the Form of Election to Purchase, as the case may be, is not completed, the
Company and the Rights Agent will deem the beneficial owner of the Rights
evidenced by this Right Certificate to be an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement) and such Assignment or
Election to Purchase will not be honored.
EXHIBIT C
CROWN AMERICAN REALTY TRUST
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES
On January 20, 2000, the Board of Trustees of Crown American Realty
Trust (the "Company") declared a dividend of one preferred share purchase right
(a "Right") for each outstanding share of Common Shares of Beneficial Interest
("Common Shares"), par value $0.01, of the Company. The Rights were issued to
holders of record on February 4, 2000 and will expire on January 20, 2010.
Initially, the Rights will not be exercisable, certificates will not
be sent to you and the Rights will automatically trade with the Common Shares.
However, ten days after a person or group of affiliated or associated persons
acquires twenty percent (20%) or more of the Company's Common Shares, or ten
business days (or such later date as may be determined by the Board of Trustees
but prior to a twenty percent (20%) acquisition) after a person or group
announces an offer the consummation of which would result in such person or
group owning twenty percent (20%) or more of the Common Shares (even if no
purchases actually occur), the Rights will become exercisable and separate
certificates representing the Rights will be distributed. We expect that the
Rights would begin to trade independently from the Common Shares at that time.
Until that time, the Rights will be represented by the existing Common Shares,
certificated or otherwise, and one Right will also be issued with respect to
each new share of the Company's Common Shares that shall become outstanding.
Common Shares issued after the record date in certificated form will contain a
notation incorporating the terms of the Rights by reference. At no time will
the Rights have any voting power.
When the Rights first become exercisable, unless a person or group has
acquired twenty percent (20%) or more of the Company's Common Shares, a holder
will be entitled to buy from the Company one one-hundredth of a share of a new
series of junior participating preferred shares of beneficial interest
(described below) for $20.00. If any person or group acquires twenty percent
(20%) or more of the Company's outstanding Common Shares, the "flip-in"
provision of the Rights will be triggered and each Right will entitle a holder
(other than such person or any member of such group) to buy, in lieu of
preferred shares, a number of additional Common Shares of the Company having a
market value of twice the exercise price of the Right. Thus, if at the time of
the twenty percent (20%) acquisition the Company's Common Shares were to have a
market value per share equal to $10.00, the holder of each Right (other than
such person or any member of such group) would be entitled to purchase four
shares of the Company's Common Shares for $20.00, i.e., at a 50% discount. The
Board of Trustees may, however, substitute the right to purchase the same number
of one one-hundredths of a share of the new preferred shares of beneficial
interest for the same price.
If the Company is involved in a merger or other business combination
at any time after a person or group has acquired twenty percent (20%) or more of
the Company's Common Shares, each Right will entitle a holder (other than a
twenty percent (20%) acquirer) to buy a number of shares of common stock of the
acquiring company having a market value of twice the exercise price of each
Right. For example, if at the time of the business combination the acquiring
company's common stock would have a per share value of $10.00 the holder of each
Right (other than a twenty percent (20%) acquirer) would be entitled to receive
four shares of the acquiring company's common stock for $20.00, i.e., at a 50%
discount.
The exercise price is subject to adjustment pursuant to standard
antidilution provisions. The above examples assume no change in the exercise
price.
Following the acquisition by any person or group of twenty percent
(20%) or more of the Company's Common Shares, but only prior to the acquisition
by a person or group of a 50% stake, the Board of Trustees will also have the
ability to require the exchange of outstanding Rights (other than Rights held by
such person or any member of such group), in whole or in part, for one share of
the Common Shares (or one one-hundredth of a share of the new preferred shares)
per Right. This provision would have an economically dilutive effect on the
acquirer, and provide a corresponding benefit to the remaining Rights holders,
that is comparable to the flip-in provision without requiring the holders of
Rights to go through the process and expense of exercising their Rights.
The Board of Trustees is also authorized to reduce the twenty percent
(20%) thresholds referred to above to not less than the greater of the sum of
.001% plus the largest percentage of the Company's Common Shares known to be
owned at the time or 10%.
At any time prior to the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of twenty percent (20%)
or more of the outstanding Common Shares, the Board of Trustees of the Company
may redeem the Rights in whole, but not in part, at a price of $0.001 per Right
(the "Redemption Price"). The redemption of the Rights may be made effective at
such time on such basis and with such conditions as the Board in its sole
discretion may establish. Immediately upon any redemption of the Rights, the
right to exercise the Rights will terminate and the only right of the holders of
Rights will be to receive the Redemption Price.
In addition to authorizing the new Rights, the Board of Trustees
designated a series of junior participating preferred shares of beneficial
interest as the preferred shares which are purchasable upon exercise of the
Rights. The shares of the junior participating preferred shares will be
nonredeemable. Each preferred share will be entitled to a cumulative dividend
equal to the greater of $1 per share or 100 times the dividend declared on the
Common Shares. In the event of liquidation, the holders of the preferred shares
will be entitled to receive an aggregate liquidation payment equal to the
greater of $100 or 100 times the payment made per share of the Company's Common
Shares. Each preferred share will have 100 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 100 times the amount received per share of the Company's
Common Shares. These rights are also protected by customary anti-dilution
provisions. In the event of issuance of preferred shares upon exercise of the
Rights, in order to facilitate trading a depositary receipt may be issued for
each one one-hundredth of a preferred share. The dividend, liquidation and
voting rights, and the non-redemption feature, of the preferred shares are
designed so that the value of the one-hundredth interest in a preferred share
purchasable with each Right will approximate the value of one share of the
Company's Common Shares.
