<PAGE>
SECURITIES AND EXCHANGE COMMISSION Washington,
D.C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934
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OSTEX INTERNATIONAL, INC.
Exact Name of Registrant as Specified in Its Charter
WASHINGTON
State of Incorporation or Organization
91-1450247
IRS Employer Identification Number
2203 AIRPORT WAY SOUTH, SUITE 400
SEATTLE, WASHINGTON 98134
Address of Principal Executive Offices
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Securities to be registered pursuant to Section 12(b) of the Act:
[NONE]
Title of Each Class to Be So Registered
[N/A]
Name of Each Exchange on Which Each Class Is to Be Registered
If this Form relates to the registration of a class of debt securities and is
effective upon filing pursuant to General Instruction A.(c)(1), please check the
following box: ............................................ [ ]
If this Form relates to the registration of a class of debt securities and is
to become effective simultaneously with the effectiveness of a concurrent
registration statement under the Securities Act of 1933 pursuant to General
Instruction A.(c)(2), please check the following box:....... [ ]
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Securities to be registered pursuant to Section 12(g) of the Act:
PREFERRED STOCK PURCHASE RIGHTS
Title of Class
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ITEM 1. DESCRIPTION F REGISTRANT'S SECURITIES TO BEREGISTERED
BOARD ACTION. On January 10, 1997, the Board of Directors (the "Board of
Directors") of Ostex International, Inc. (the "Company") declared a dividend of
one preferred share purchase right (a "Right") for each outstanding share of
common stock, par value $.01 per share (the "Common Shares"), of the Company.
The dividend is payable on January 27, 1997 (the "Record Date") to the
shareholders of record on that date. Each Right entitles the registered holder
to purchase from the Company one one hundredth of share of Series A Junior
Participating Preferred Stock, par value $.01 per share (the "Preferred
Shares"), of the Company at a price of $38 per one one-hundredth of a
Preferred Share (the "Purchase Price"), subject to adjustment. The
description and terms of the Rights are set forth in a Rights Agreement
(the "Rights Agreement") between the Company and ChaseMellon Shareholder
Services L.L.C., as Rights Agent (the "Rights Agent").
Approximately 12,438,667 Common Shares were outstanding as of January 27,
1997. Each Common Share outstanding at the close of business on
January 27, 1997 will receive one Right. The Board of Directors of the Company
has reserved sufficient Preferred Shares for issuance upon exercise of the
Rights.
ANTITAKEOVER EFFECTS. The Rights have certain antitakeover effects and
will cause substantial dilution to a person or group that attempts to acquire
the Company on terms not approved by the Board of Directors. The Rights
should not affect any prospective offeror willing to make an all-cash offer at
a full and fair price, or willing to negotiate with the Board of Directors,
nor will the Rights interfere with any merger or other business combination
approved by the Board of Directors
TRIGGERING EVENTS. 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 action of the Board of Directors prior to such time as any
person or group of affiliated persons 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 called the "Distribution Date"), the
Rights will be evidenced, with respect to any of the Common Share certificates
outstanding as of the Record Date, by such Common Share certificate with a
copy of this Summary of Rights attached thereto.
ATTACHMENT TO COMMON STOCK. 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.
Until the Distribution Date (or earlier redemption or expiration of the
Rights), new Common Share certificates issued after the Record Date upon
transfer or new issuance of Common Shares will contain a notation
incorporating the Rights Agreement by reference. Until the Distribution
Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for Common Shares outstanding as
of the Record Date, even without such notation or a copy of this Summary
of Rights being attached thereto, will also constitute the transfer of the
Rights associated with the Common Shares represented by such
certificate. As soon as practicable following the Distribution Date,
separate certificates evidencing the Rights ("Right Certificates") will be
mailed to holders of record of the Common Shares as of the close of business on
the Distribution Date, and such separate Right Certificates alone will evidence
the Rights.
EXERCISE OF RIGHTS. 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. Nonexercisable
until the Distribution Date, the Rights will expire on
January 27, 2007 (the "Final Expiration Date"), unless the Final Expiration Date
is extended or unless the Rights are earlier redeemed or exchanged
by the Company, in each case, as described below.
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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 stock
dividend on, or a subdivision, combination or reclassification of, the
Preferred Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights or warrants to subscribe for or purchase Preferred Shares at a
price, or securities convertible into Preferred Shares with a conversion price,
less than the then-current market price of the Preferred Shares, or (iii)
upon the distribution to holders of the Preferred Shares of evidences of
indebtedness or assets (excluding regular 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 stock split of the Common Shares or a stock
dividend on the Common Shares payable in Common Shares or subdivisions,
consolidations or combinations of the Common Shares occurring,
in any such case, prior to the Distribution Date.
TERMS OF PREFERRED SHARES. Preferred Shares purchasable upon exercise
of the Rights will not be redeemable. Each Preferred Share will be entitled
to a minimum preferential quarterly dividend payment of $1 per share, but
will be entitled to an aggregate dividend of 100 times the dividend declared
per Common Share. In the event of liquidation, the holders of the Preferred
Shares will be entitled to a minimum preferential liquidation payment of
$100 per share, but will be entitled to an aggregate payment 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 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 Preferred Shares' dividend, liquidation and
voting rights, the value of the one one-hundredth interest in a Preferred Share
purchasable upon exercise of each Right should approximate the value of one
Common Share.
If 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 will be
made so that each holder of a Right will thereafter have the right to receive,
upon the exercise thereof at the then current exercise price of the Right, that
number of shares of common stock of the acquiring company that at the time of
such transaction will have a market value of two times the exercise price of
the Right. If any person or group of affiliated or associated persons becomes
an Acquiring Person, proper provision shall be made so that 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
that number of Common Shares having a market value of two times the exercise
price of the Right.
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 (other than
fractions that 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.
EXCHANGE OF RIGHTS. At any time after any person or group becomes
an Acquiring Person and prior to the acquisition by such person or group
of 50% or more of the outstanding Common Shares, the Board of Directors may
exchange the Rights (other than Rights owned by such person or group that
will have become void), in whole or in part, at an exchange ratio of one
Common Share, or one onehundredth of a Preferred Share, per Right (subject
to adjustment).
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REDEMPTION OF RIGHTS. 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 $.0001 per Right (the
"Redemption Price"). The redemption of the Rights may be made effective at
such time on such basis 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.
AMENDMENT OF RIGHTS. The terms of the Rights may be
amended by the Board of Directors without the consent of the holders of the
Rights, including an amendment to lower certain thresholds described 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%, except that, from and after such time as any person or group of
affiliated or associated persons becomes an Acquiring
Person, no such amendment may adversely affect the interests of the holders of
the Rights. The ability of the Board of Directors to amend the terms of
the Rights is in addition to and in no way limits the discretion of the Board
of Directors to redeem the Rights.
RIGHTS AGREEMENT. A copy of the Rights Agreement is hereby filed with the
Securities and Exchange Commission as an Exhibit to this Registration Statement
on Form 8-A. A copy of the Rights Agreement is available
free of charge from the Company. This summary description of the Rights
does not purport to be complete and is qualified in its entirety by reference
to the Rights Agreement, which is hereby incorporated herein by reference.
ITEM 2. EXHIBITS
Exhibit
Number Description
- ------- ---------------------------------------------------------------
1.1 Form of Right Certificate [included as Exhibit B to Exhibit 2.1
to this Form 8-A].
2.1 Rights Agreement dated as of January 21, 1997 between Ostex
International, Inc. and ChaseMellon Shareholder Services L.L.C..
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the registrant has duly caused this registration statement to be
signed on its behalf by the undersigned hereunto duly authorized.
Dated the 22nd day of January, 1997.
OSTEX INTERNATIONAL, INC.
By /S/ ROBERT M. LITTAUER
---------------------------------
Robert M. Littauer Senior Vice
President of Finance & Operations
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INDEX TO EXHIBITS
TO
FORM 8-A
Exhibit
Number Description
- ------- ---------------------------------------------------------------
1.1 Form of Right Certificate [included as Exhibit B to Exhibit 2.1
to this Form 8-A].
2.1 Rights Agreement dated as of January 21, 1997 between Ostex
International, Inc. and ChaseMellon Shareholder Services L.L.C..
<PAGE>
EXHIBIT 2.1 TO FORM 8-A
RIGHTS AGREEMENT
BETWEEN
OSTEX INTERNATIONAL, INC.
AND
CHASEMELLON SHAREHOLDER SERVICES L.L.C.
DATED AS OF JANUARY 21, 1997
<PAGE>
TABLE OF CONTENTS
Section 1. Certain Definitions.................................1
Section 2. Appointment of Rights Agent.........................3
Section 3. Issue of Right Certificates.........................3
Section 4. Form of Right Certificates..........................4
Section 5. Countersignature and Registration...................4
Section 6. Transfer, Split Up, Combination and
Exchange of Right Certificates; Mutilated,
Destroyed, Lost or Stolen Right Certificates........5
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights...........................5
Section 8. Cancellation and Destruction of Right
Certificates........................................6
Section 9. Availability of Preferred Shares....................6
Section 10. Preferred Shares Record Date........................6
Section 11. Adjustment of Purchase Price, Number of
Shares or Number of Rights..........................7
Section 12. Certificate of Adjusted Purchase Price
or Number of Shares.................................11
Section 13. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power..........................11
Section 14. Fractional Rights and Fractional Shares.............12
Section 15. Rights of Action....................................12
Section 16. Agreement of Right Holders..........................13
Section 17. Right Certificate Holder Not Deemed
a Shareholder.......................................13
Section 18. Concerning the Rights Agent.........................13
Section 19. Merger or Consolidation or Change of
Name of Rights Agent................................14
Section 20. Duties of Rights Agent..............................14
Section 21. Change of Rights Agent..............................15
Section 22. Issuance of New Right Certificates..................16
Section 23. Redemption..........................................16
Section 24. Exchange............................................17
Section 25. Notice of Certain Events............................17
Section 26. Notices.............................................18
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Section 27. Supplements and Amendments..........................18
Section 28. Successors..........................................19
Section 29. Benefits of this Agreement..........................19
Section 30. Severability........................................19
Section 31. Governing Law.......................................19
Section 32. Counterparts........................................19
Section 33. Descriptive Headings................................20
Exhibit A - Form of Certificate of Designation--Rights and
Preferences of Series A Junior Participating
Preferred Stock
Exhibit B - Form of Right Certificate
Exhibit C - Summary of Rights to Purchase Preferred Shares
<PAGE>
RIGHTS AGREEMENT
Agreement, dated as of January 21, 1997, between Ostex
International, Inc., a Washington corporation (the "Company"),
and ChaseMellon Shareholder Services L.L.C. (the "Rights Agent").
The Board of Directors of the Company ("Board of Directors") 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 January 27, 1997 (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).
Accordingly, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
SECTION 1. CERTAIN DEFINITIONS
For purposes of this Agreement, the following terms have the
meanings indicated:
(a) "Acquiring Person" shall mean any Person (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 20% or more of the Common Shares of the
Company then outstanding, but shall not include the Company, any
Subsidiary (as such term is hereinafter defined) of the Company,
any employee benefit plan of the Company or any Subsidiary of the
Company, or any entity holding Common Shares for or pursuant to
the terms of any such plan. 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 outstanding, increases the proportionate
number of shares beneficially owned by such Person to 20% or more
of the Common Shares of the Company then outstanding; provided,
however that if a Person shall become the Beneficial Owner of 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 Directors 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 Securities Exchange Act of 1934, as amended
(the "Exchange Act"), 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;
(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) pursuant to any agreement, arrangement
<PAGE>
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,
arrangement or understanding (other than customary
agreements with and between underwriters and selling
group members with respect to a bona fide public offering
of securities) for the purpose of acquiring, holding,
voting (except to the extent contemplated by the proviso
to Section l(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
Washington 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.,
Seattle time, on such date; provided, however, that if such date
is not a Business Day it shall mean 5:00 p.m., Seattle time, on
the next succeeding Business Day.
(f) "Common Shares" when used with reference to the Company shall
mean the shares of common stock, par value $.01 per share, of the
Company. "Common Shares" when used with reference to any Person
other than the Company shall mean the capital stock (or equity
interest) with the greatest voting power of such other Person or,
if such other Person is a Subsidiary of another Person, the
Person or Persons that ultimately control such first-mentioned
Person.
(g) "Distribution Date" shall have the meaning set forth in
Section 3 hereof.
(h) "Final Expiration Date" shall have the meaning set forth in
Section 7 hereof.
(i) "Person" shall mean any individual, firm, corporation or other
entity, and shall include any successor (by merger or otherwise)
of such entity.
(j) "Preferred Shares" shall mean shares of Series A Junior
Participating Preferred Stock, par value $.01 per share, of the
Company having the rights and preferences set forth in the
Certificate of Designation of Series A Junior Participating
Preferred Stock attached as Exhibit A hereto.
(k) "Redemption Date" shall have the meaning set forth in Section
7 hereof.
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(l) "Shares Acquisition Date" shall mean the first date of public
announcement by the Company or an Acquiring Person that an
Acquiring Person has become such.
(m) "Subsidiary" of any Person shall mean any corporation or other
entity 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 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 RIGHTS CERTIFICATES
(a) Until the earlier of (i) the 10th day after the Shares
Acquisition Date and (ii) the 10th business day (or such later
date as may be determined by action of the Board of Directors
before such time as any Person becomes an Acquiring Person) after
the date of the commencement by any Person (other than the
Company, any Subsidiary of the Company, any employee benefit plan
of the Company or of any Subsidiary of the Company or any entity
holding Common Shares for or pursuant to the terms of any such
plan) of, or of the first public announcement of the intention of
any Person (other than the Company, 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) to commence, a tender
or exchange offer the consummation of which would result in any
Person becoming the Beneficial Owner of Common Shares aggregating
20% or more of the then outstanding Common Shares (including any
such date that is after the date of this Agreement and before the
issuance of the Rights; the earlier of such dates being herein
referred to as the "Distribution Date"), (A) the Rights will be
evidenced (subject to the provisions of Section 3(b) hereof) by
the certificates for Common Shares registered in the names of the
holders thereof (which certificates shall also be deemed to be
Right Certificates as hereinafter defined) and not by separate
Right Certificates and (B) 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 (subject to appropriate
adjustments, as hereinafter defined). As of the Distribution
Date, the Rights will be evidenced solely by such Right
Certificates.
(b) On the Record Date, or as soon as practicable thereafter, 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-prepaid 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. With respect to certificates for
Common Shares outstanding as of the Record Date, until the
Distribution Date, the Rights will be evidenced by such
certificates registered in the names of the holders thereof
together with a copy of the Summary of Rights attached thereto.
Until the Distribution Date (and the earlier of the Redemption
Date or the Final Expiration Date), the surrender for transfer of
any certificate for Common Shares outstanding on the Record Date,
with or without a copy of the Summary of Rights attached thereto,
shall also constitute the transfer of the Rights associated with
the Common Shares represented thereby.
(c) Certificates for Common Shares that become outstanding
(including, without limitation, reacquired Common Shares referred
to in the last sentence of this paragraph (c)) after the Record
<PAGE>
Date but before the earliest of the Distribution Date, the
Redemption Date and 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 Ostex International, Inc. and
ChaseMellon Shareholder Services L.L.C. dated as of
January 21, 1997 (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 Ostex International, Inc.. Under certain
circumstances, as set forth in the Rights Agreement, such
Rights will be evidenced by separate certificates and
will no longer be evidenced by this certificate. Ostex
International, Inc. 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, Rights issued to any Person who becomes an
Acquiring Person (as defined in the Rights Agreement) may
become null and void.
With respect to such certificates containing the foregoing
legend, until the Distribution Date, the Rights associated with
the Common Shares represented by such certificates shall be
evidenced by such certificates alone, and the surrender for
transfer of any such certificate shall also constitute the
transfer of the Rights associated with the Common Shares
represented thereby. If the Company purchases or acquires any
Common Shares after the Record Date but before the Distribution
Date, 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 the Common Shares
which are no longer outstanding.
SECTION 4. FORM OF RIGHT CERTIFICATES
The Right Certificates (and the forms of election to purchase
Preferred Shares and of assignment 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 (the "Purchase
Price"), but the number of such one one-hundredths of a Preferred
Share and the Purchase Price shall be subject to adjustment as
provided herein.
SECTION 5. COUNTERSIGNATURE AND REGISTRATION
The Right Certificates shall be executed on behalf of the Company
by its Chairman of the Board, its Chief Executive Officer, its
President, any of its Senior Vice Presidents or Vice Presidents,
or its Treasurer, either manually or by facsimile signature. The
Right Certificates shall be manually countersigned by the Rights
Agent and shall not be valid for any purpose unless
countersigned. In case any officer of the Company who shall have
signed any of the Right Certificates shall cease to be such
officer of the Company before countersignature by the Rights
Agent and issuance and delivery by the Company, such Right
Certificates, nevertheless, may be countersigned by the Rights
Agent and issued and delivered by the Company with the same force
and effect as though the person who signed such Right
Certificates had not ceased to be such officer of the Company;
and any Right Certificate may be signed on behalf of the Company
by any person who, at the actual date of the execution of such
Right Certificate, shall be a proper officer of the Company to
sign such Right Certificate, although at the date of the
execution of this Agreement any such person was not such an
officer.
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
<PAGE>
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
Subject to the provisions of Section 14 hereof, at any time after
the close of business on the Distribution Date, and at or before
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. Thereupon 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.
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 27, 2007 (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
such 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 $38, and 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 exercisable
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 thereupon promptly (i)(A) requisition from any
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 depository agent depository
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
<PAGE>
receipts shall be deposited by the transfer agent with the
depository agent) and the Company hereby directs the depository
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 depository
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
unexercised shall be issued by the Rights Agent to the registered
holder of such Right Certificate or to his or her duly authorized
assigns, subject to the provisions of Section 14 hereof.
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
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. AVAILABILITY OF PREFERRED SHARES
The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and unissued
Preferred Shares the number of Preferred Shares that will be
sufficient to permit the exercise in full of all outstanding
Rights in accordance with Section 7 hereof. 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 the
certificates for such Preferred Shares (subject to payment of the
Purchase Price), be duly and validly authorized and issued and
fully paid and nonassessable shares.
The Company further covenants and agrees that it will pay when
due and payable any and all federal and state transfer taxes and
charges that 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 that may be payable in respect
of any transfer or delivery of Right Certificates to a person
other than, or the issuance or delivery of certificates or
depositary receipts for the Preferred Shares 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 RECORD DATE
Each person in whose name any certificate for Preferred Shares is
issued upon the exercise of Rights shall for all purposes be
deemed to have become the holder of record of the Preferred
Shares represented thereby on, and such certificate shall be
dated, the date upon which the Right Certificate evidencing such
Rights was duly surrendered and payment of the Purchase Price
(and any applicable transfer taxes) was made; provided, however,
that if the date of such surrender and payment is a date upon
which the Preferred Shares transfer books of the Company are
closed, such person shall be deemed to have become the record
<PAGE>
holder of such shares on, and such certificate shall be dated,
the next succeeding Business Day on which the Preferred Shares
transfer books 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 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
payable 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 reclassification of the Preferred
Shares (including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing or
surviving corporation), except as otherwise provided in this
Section 11(a), the Purchase Price in effect at the time of the
record date for such dividend or of the effective date of such
subdivision, combination or reclassification, and the number and
kind of shares of capital stock issuable on such date, shall be
proportionately adjusted so that the holder of any Right
exercised 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 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.
(ii) Subject to Section 24 hereof, 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 (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 product by (B) 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. If any Person shall become an Acquiring Person and the
Rights shall then be outstanding, the Company shall not take any
action that 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 hereof
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) If 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
<PAGE>
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)) hereof on such record date, the Purchase Price to be in
effect after such record date shall be determined by multiplying
the Purchase Price in effect immediately prior to such record
date by a fraction the numerator of which shall be the number of
Preferred Shares outstanding on such record date plus the number
of Preferred Shares that 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 convertible securities so to be
offered are initially convertible); provided, however, that in no
event shall the consideration to be paid upon the exercise of one
Right be less than the aggregate par value of the shares of
capital stock of the Company issuable upon exercise of one Right.
In case such subscription 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 Directors, 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 successively whenever such a record date
is fixed; and if such rights, options or warrants are not so
issued, the Purchase Price shall be adjusted to be the Purchase
Price that 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
corporation) of evidences of indebtedness or assets (other than a
regular quarterly cash dividend 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 Directors, whose determination shall
be described in a statement filed with the Rights Agent) of the
portion of the assets or evidences of indebtedness so to be
distributed or of such subscription rights or warrants applicable
to one 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. Such adjustments shall be made
successively whenever such a record date is fixed; and if such
distribution is not so made, the Purchase Price shall again be
adjusted to be the Purchase Price which would then be in effect
if such record date had not been fixed.
(d) (i) For the purpose of any computation hereunder, the "current
per share market price" of any security (a "Security" for the
purpose of this Section 11(d)(i)) on any date shall be deemed to
be the average of the daily closing prices per share of such
Security for the 30 consecutive Trading Days (as such term is
<PAGE>
hereinafter defined) immediately prior to such date; provided,
however, that if 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 New York Stock Exchange or, if the
Security is not listed or admitted to trading on the New York
Stock Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities listed on
the principal national securities exchange on which the Security
is listed or admitted to trading or, if the Security is not
listed or admitted to trading on any national securities
exchange, the last quoted price or, if not so quoted, the average
of the high bid and low asked prices in the over-the-counter
market, as reported by the National Association of Securities
Dealers, Inc. Automated Quotations System ("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
Directors. The term "Trading Day" shall mean a day on which the
principal national securities exchange on which the Security is
listed or admitted to trading is open for the transaction of
business or, if the Security is not listed or admitted to trading
on any national securities exchange, a Business Day.
(ii) For the purpose of any computation hereunder, the "current
per share market price" of the Preferred Shares shall be
determined in accordance with the method set forth in
Section 11(d)(i) hereof. If the Preferred Shares are not
publicly traded, the "current per share market price" of the
Preferred Shares shall be conclusively deemed to be the current
per share market price of the Common Shares as determined
pursuant to Section 11(d)(i) hereof (appropriately adjusted to
reflect any stock split, stock dividend or similar transaction
occurring after the date hereof), multiplied by one hundred. If
neither the Common Shares nor the Preferred Shares are publicly
held or so listed or traded, "current per share market price"
shall mean the fair value per share as determined in good faith
by the Board of Directors, 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
1% in the Purchase Price; provided, however, that any adjustments
that by reason of this Section 11(e) are not required to be made
shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made
to the nearest cent or to the nearest one one-millionth of a
Preferred Share or one ten-thousandth of any other share or
security as the case may be. Notwithstanding the first sentence
of this Section 11(e), any adjustment required by this Section 11
shall be made no later than the earlier of (i) three years from
the date of the transaction which requires such adjustment and
(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)
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 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 Section (a) through (c)
hereof, inclusive, and the provisions of Sections 7, 9, 10 and 13
hereof 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.
<PAGE>
(h) Unless the Company shall have exercised its election as
provided in Section 11(i) hereof, 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 thereafter 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
(A) the number of one one-hundredths of a share covered by a
Right immediately prior to this adjustment by (B) 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 announcement 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 distributed to such holders of record
in substitution and replacement for the Right Certificates held
by such holders prior to the date of adjustment, and upon
surrender thereof, if required by the Company, new Right
Certificates evidencing all the Rights to which such holders
shall be entitled after such adjustment. Right Certificates so
to be distributed shall be issued, executed and 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 that 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 that
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
<PAGE>
payable in Preferred Shares or issuance of rights, options or
warrants referred to hereinabove in Section 11(b) hereof,
hereafter made by the Company to holders of its Preferred Shares
shall not be taxable to such shareholders.
(n) If at any time after the date of this Agreement 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 purchasable 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
that each Common Share outstanding immediately prior to such
event had issued with respect to it. The adjustments 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.
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) mail a brief
summary thereof to each holder of a Right Certificate in
accordance with Section 25 hereof.
SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS
OR EARNING POWER
In the event, directly or indirectly, at any time after a Person
has become an Acquiring Person, (a) the Company shall consolidate
with, or merge with and into, any other Person, (b) any Person
shall consolidate with the Company, or merge with and into the
Company and the Company shall be the continuing or surviving
corporation 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 (c) the Company
shall sell or otherwise transfer (or one or more of its
Subsidiaries shall sell or otherwise 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 (i) 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 Common Shares of
such other Person (including the Company as successor thereto or
as the surviving corporation) 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 product by (B) 50% of the then
current per share market price of the Common Shares of such other
Person (determined pursuant to Section 11(d) hereof) on the date
of consummation of such consolidation, merger, sale or transfer;
(ii) the issuer of such Common Shares shall thereafter be liable
for, and shall assume, by virtue of such consolidation, merger,
sale or transfer, all the obligations and duties of the Company
pursuant to this Agreement; (iii) the term "Company" shall
thereafter be deemed to refer to such issuer; and (iv) such
issuer shall take such steps (including, but not limited to, the
reservation of a sufficient number of its Common Shares) in
connection with such consummation as may be necessary to ensure
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
Company shall not consummate any such consolidation, merger, sale
<PAGE>
or transfer unless prior thereto the Company and such issuer
shall have executed and delivered to the Rights Agent a
supplemental agreement so providing. The Company shall not enter
into any transaction of the kind referred to in this Section 13
if at the time of such transaction there are any rights,
warrants, instruments or securities outstanding or any agreements
or arrangements that, as a result of the consummation of such
transaction, would eliminate or substantially diminish the
benefits intended to be afforded by the Rights. The provisions
of this Section 13 shall similarly apply to successive mergers or
consolidations or sales or other transfers.
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES
(a) The Company shall not be required to issue fractions of Rights
or to distribute Right Certificates that evidence fractional
Rights. In lieu of such fractional Rights, there shall be paid
to the registered holders of the Right Certificates with regard
to which such fractional Rights would otherwise be issuable, an
amount in cash equal to the same fraction of the current market
value of a whole Right. For the purposes of this Section 14(a),
the current market value of a whole Right shall be the closing
price of the Rights for the Trading Day immediately prior to the
date on which such fractional Rights would have been otherwise
issuable. The closing price for any day shall be the last sale
price, regular way, or, in case no such sale takes place on such
day, the average of the closing bid and asked prices, regular
way, in either case as reported in the principal consolidated
transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock Exchange or, if the
Rights are not listed or admitted to trading on the New York
Stock Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities listed on
the principal national securities exchange on which the Rights
are listed or admitted to trading or, if the Rights are not
listed or admitted to trading on any national securities
exchange, the last quoted price or, if not so quoted, the average
of the high bid and low asked prices in the over-the-counter
market as reported by Nasdaq or such other system then in use or,
if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the
Rights selected by the Board of Directors. 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 Directors shall be used.
(b) The Company shall not be required to issue fractions of
Preferred Shares (other than fractions that are integral
multiples of one one-hundredth of a Preferred Share) upon
exercise of the Rights or to distribute certificates that
evidence fractional Preferred Shares (other than fractions that
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, however, 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 pursuant 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
<PAGE>
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 or
her own behalf and for his or her 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 or her
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 are transferable
only in connection with the transfer of the Common Shares;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if
surrendered at the 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 (or, prior to the
Distribution Date, the associated Common Shares certificate) is
registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the associated Common Shares
certificate 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.
SECTION 17. RIGHT CERTIFICATE HOLDER NOT DEEMED A SHAREHOLDER
No holder, as such, of any Right Certificate 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
that 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 Certificate, as such, any of the rights of a
shareholder of the Company or any right to vote for the election
of directors 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 the Right or Rights evidenced by such Right Certificate
shall have been exercised in accordance with the provisions
hereof.
SECTION 18. CONCERNING THE RIGHTS AGENT
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. In no case will the
Rights Agent be liable for special, indirect, incidental or
consequential loss or damage of any kind whatsoever, even if the
Rights Agent has been advised of the likelihood of such loss or
damage.
<PAGE>
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
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 provided in the Right
Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall be changed
and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Right
Certificates so countersigned; and in case at that time any of
the Right Certificates shall not have been countersigned, the
Rights Agent may countersign such Right Certificates either in
its prior name or in its changed name; and in all such cases such
Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
SECTION 20. DUTIES OF RIGHTS AGENT
The Rights Agent undertakes the duties and obligations 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 Chairman of
the Board, the Chief Executive Officer, the President, any Senior
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
<PAGE>
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 execution hereof by the Rights
Agent) or in respect of the validity or execution of any Right
Certificate (except its countersignature thereof); nor shall it
be responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any Right
Certificate; nor shall it be responsible for any change in the
exercisability of the Rights (including the Rights becoming void
pursuant to Section 11(a)(ii) hereof) or any adjustment in the
terms of the Rights (including the manner, method or amount
thereof) provided for in Section 3, 11, 13, 23 or 24 hereof, 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 actual notice that
such change or adjustment is required); nor shall it by any act
hereunder be deemed to make any representation or warranty as to
the authorization or reservation of any Preferred Shares to be
issued pursuant to this Agreement or any Right Certificate or as
to whether any Preferred Shares 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 Chairman of the Board, the Chief
Executive Officer, the President, any Senior 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.
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 or Preferred Shares by registered or
certified mail, and to the holders of the Right Certificates by
first-class mail. The Company may remove the Rights Agent or any
successor Rights Agent upon 30 days' notice in writing, mailed to
the Rights Agent or successor Rights Agent, as the case may be,
and to each transfer agent of the Common Shares or Preferred
Shares by registered or certified mail, and to the holders of the
Right Certificates by first-class mail. If the Rights Agent
shall resign or be removed or shall otherwise become incapable of
acting, the 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 (who shall, with such notice, submit his
or her Right Certificate for inspection by the Company), then the
<PAGE>
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 either (a) a corporation
organized and doing business under the laws of the United States
or of the State of Washington or New York (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 Washington
or New York), in good standing, having an office in the State of
Washington or New York, which is authorized under such laws to
exercise corporate trust or stock transfer powers and is subject
to supervision or examination by federal or state authority and
that has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $50 million or (b) an
affiliate of such a corporation. After appointment, the
successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the
successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment the Company shall
file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common Shares or Preferred Shares,
and mail a notice thereof in writing to the registered holders of
the Right Certificates. Failure to give any notice provided for
in this Section 21, however, or any defect 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 Directors to reflect any adjustment or
change in the Purchase Price and the number or kind or class of
shares or other securities or property purchasable under the
Right Certificates made in accordance with the provisions of this
Agreement.
SECTION 23. REDEMPTION
(a) The Board of Directors 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 of the then outstanding Rights at a
redemption price of $.0001 per Right, appropriately adjusted to
reflect any stock split, stock dividend or similar transaction
occurring after the date hereof (such redemption price being
hereinafter referred to as the "Redemption Price"). The
redemption of the Rights by the Board of Directors 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.
(b) Immediately upon the action of the Board of Directors 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 Directors 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.
<PAGE>
SECTION 24. EXCHANGE
(a) The Board of Directors 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 stock split, stock dividend or similar transaction
occurring after the date hereof (such exchange ratio being
hereinafter referred to as the "Exchange Ratio").
Notwithstanding the foregoing, the Board of Directors 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 Directors 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 at their last addresses as they
appear upon the registry books of the Rights Agent. Any notice
that 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 that will be
exchanged. Any partial exchange shall be effected pro rata based
on the number of Rights (other than Rights that have become void
pursuant to the provisions of Section 11(a)(ii) hereof) held by
each holder of Rights.
(c) If there shall not be sufficient Common Shares 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. If 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 that evidence fractional
Common Shares. 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.
SECTION 25. NOTICE OF CERTAIN EVENTS
(a) In case the Company shall propose (i) to pay any dividend
payable in stock of any class to the holders of its Preferred
Shares or to make any other distribution to the holders of its
Preferred Shares (other than a regular quarterly cash dividend),
(ii) to offer to the holders of its Preferred Shares rights or
warrants to subscribe for or to purchase any additional Preferred
Shares or shares of stock of any class or any other securities,
rights or options, (iii) to effect any reclassification of its
<PAGE>
Preferred Shares (other than a reclassification involving only
the subdivision of outstanding 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 stock 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:
Ostex International, Inc.
2203 Airport Way South, Ste. 301
Seattle, Washington 98134
Attention: Robert M. Littauer
Senior Vice President, Finance and Administration
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:
ChaseMellon Shareholder Services L.L.C.
520 Pike Street, Suite 1220
Seattle, WA 98101
Attention: Ardis "Dee" Henderson
Vice President
Notices or demands authorized by this Agreement to be given or
made by the Company or the Rights Agent to the holder of any
Right Certificate shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed to such holder at
the address of such holder as shown on the registry books of the
Company.
SECTION 27. SUPPLEMENTS AND AMENDMENTS
The Company may from time to time supplement or amend this
Agreement without the approval of any holders of Right
Certificates in order to cure any ambiguity, to correct or
<PAGE>
supplement any provision contained herein that may be defective
or inconsistent with any other provisions herein, or to make any
other provisions with respect to the Rights that 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 that 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 l(a) and 3(a) hereof to not less than the
greater of (a) 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, any
Subsidiary of the Company, any employee benefit plan of the
Company or any Subsidiary of the Company, or any entity holding
Common Shares for or pursuant to the terms of any such plan) and
(b) 10%.
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 or corporation 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 restriction of this Agreement
is held by a court of competent jurisdiction or other authority
to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall
remain in full force and effect and shall in no way be affected,
impaired or invalidated.
SECTION 31. GOVERNING LAW
This Agreement and each Right Certificate issued hereunder shall
be deemed to be a contract made under the laws of the State of
Washington 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
one and the same instrument.
<PAGE>
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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed, all as of the day and year first above
written.
OSTEX INTERNATIONAL, INC.
By: /S/ ROBERT M.LITTAUER
-------------------------------
Robert M. Littauer
Senior Vice President, Finance
and Operations
CHASEMELLON SHAREHOLDER SERVICES L.L.C.
By: /S/ ARDIS "DEE" HENDERSON
-------------------------------
Ardis "Dee" Henderson
Vice President
<PAGE>
EXHIBIT A
FORM OF CERTIFICATE OF DESIGNATION -
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
OSTEX INTERNATIONAL, INC.
Pursuant to Section 23B.06.020 of the Washington Business
Corporation Act, Ostex International, Inc., a Washington
corporation (the "Corporation"), does hereby certify that the
following provisions from the Amended and Restated Articles (the
"Articles") of the Corporation were duly adopted by the Board of
Directors of the Corporation (the "Board of Directors") as of
January 10, 1997:
RESOLVED, that pursuant to the authority granted to and vested in
the Board of Directors in accordance with the provisions of the
Articles, the Board of Directors hereby creates a series of
Preferred Stock, par value $.01 per share, of the Corporation and
hereby states the designation and number of shares, and fixes the
relative rights, preferences and limitations thereof (in addition
to the provisions set forth in the Articles which are applicable
to the Preferred Stock of all classes and series), as set forth
in Section 2.8 of the Articles, as follows:
2.8 Series A Junior Participating Preferred Stock. The
Corporation hereby designates 500,000 shares of its Preferred
Stock as "Series A Junior Participating Preferred Stock." The
rights, preferences, and limitations of such shares are as set
forth herein.
2.8.1 Designation of Series A Junior Participating Preferred
Stock and Amount. The shares of such series shall be designated
as "Series A Junior Participating Preferred Stock" (the "Series A
Preferred Stock") and the number of shares constituting the
Series A Preferred Stock shall be 500,000. Such number of shares
may be increased or decreased by resolution of the Board of
Directors; provided, however, that no decrease shall reduce the
number of shares of Series A Preferred Stock to a number less
than the number of shares then outstanding plus the number of
shares reserved for issuance upon the exercise of Rights (the
"Rights") issued pursuant to the Rights Agreement dated as of
January 21, 1997 between the Corporation and ChaseMellon
Shareholder Services L.L.C. (the "Rights Agreement"); provided,
further, that if more than a total of 500,000 shares of Series A
Preferred Stock shall be issuable upon the exercise of the
Rights, the Board of Directors, pursuant to Section 23B.06.020 of
the Washington Business Corporation Act, shall direct by
resolution that Articles of Amendment be properly executed and
filed, in accordance with the provisions thereof, providing for
an increase in the authorized shares of Series A Preferred Stock
to the largest number of whole shares issuable upon exercise of
the Rights.
2.8.2 Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock (or any similar stock) ranking prior
and superior to the Series A Preferred Stock with respect to
dividends, the holders of shares of Series A Preferred Stock, in
preference to the holders of Common Stock, par value $.01 per
share (the "Common Stock"), of the Corporation, and of any other
junior stock, shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available
for the purpose, quarterly dividends payable in cash on the first
day of March, June, September and December in each year (each
such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a
share of Series A Preferred Stock, in an amount per share
(rounded to the nearest cent) equal to the greater of (i) $1 and
(ii) 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 noncash dividends or other distributions, other
than a dividend payable in shares of Common Stock or a
subdivision of the outstanding shares of Common Stock (by
<PAGE>
reclassification or otherwise), declared on the Common Stock
since the immediately preceding Quarterly Dividend Payment Date
or, with respect to the first Quarterly Dividend Payment Date,
since the first issuance of any share or fraction of a share of
Series A Preferred Stock. In the event the Corporation shall at
any time declare or pay any dividend on the Common Stock payable
in shares of Common Stock, or effect a subdivision or combination
or consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the amount to which
holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under clause (ii) of the
preceding sentence shall be adjusted by multiplying such amount
by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on
the Series A Preferred Stock as provided in paragraph (A) of this
Section 2.8.2 immediately after it declares a dividend or
distribution on the Common Stock (other than a dividend payable
in shares of Common Stock); provided, however, that, in the event
no dividend or distribution shall have been declared on the
Common Stock during the period between any Quarterly Dividend
Payment Date and the next subsequent Quarterly Dividend Payment
Date, a dividend of $1 per share on the Series A Preferred Stock
shall nevertheless be payable on such subsequent Quarterly
Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such
shares, unless the date of issue of such shares is prior to the
record date for the first Quarterly Dividend Payment Date, in
which case dividends on such shares shall begin to accrue from
the date of issue of such shares, or unless the date of issue is
a Quarterly Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series A
Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of which
events such dividends shall begin to accrue and be cumulative
from such Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares
of Series A Preferred Stock in an amount less than the total
amount of such dividends at the time accrued and payable on such
shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders
of shares of Series A Preferred Stock entitled to receive payment
of a dividend or distribution declared thereon, which record date
shall be not more than 60 days prior to the date fixed for the
payment thereof.
2.8.3 Voting Rights. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Preferred Stock shall entitle the holder
thereof to 100 votes on all matters submitted to a vote of the
shareholders of the Corporation. In the event the Corporation
shall at any time declare or pay any dividend on the Common Stock
payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the
number of votes per share to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event
shall be adjusted by multiplying such number by a fraction the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
<PAGE>
(B) Except as otherwise provided herein, in any other Certificate
of Designations creating a series of Preferred Stock or any
similar stock or by law, the holders of shares of Series A
Preferred Stock and the holders of shares of Common Stock and any
other capital stock of the Corporation having general voting
rights shall vote together as one class on all matters submitted
to a vote of shareholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by law,
holders of Series A Preferred Stock 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 Stock as
set forth herein) for taking any corporate action.
2.8.4 Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided
in Section 2.8.2 are in arrears, thereafter and until all accrued
and unpaid dividends and distributions, whether or not declared,
on shares of Series A Preferred Stock outstanding shall have been
paid in full, the Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding
up) to the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or
winding up) with the Series A Preferred Stock except
dividends paid ratably on the Series A Preferred Stock and
all such parity stock on which dividends are payable or in
arrears in proportion to the total amounts to which the
holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as
to dividends or upon liquidation, dissolution or winding up)
to the Series A Preferred Stock provided that the
Corporation may at any time redeem, purchase or otherwise
acquire shares of any such junior stock in exchange for
shares of any stock of the Corporation ranking junior
(either as to dividends or upon dissolution, liquidation or
winding up) to the Series A Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock or any
shares of stock ranking on a parity with the Series A
Preferred Stock, except in accordance with a purchase offer
made in writing or by publication (as determined by the
Board of Directors) to all holders of such shares upon such
terms as the Board of Directors, after consideration of the
respective annual dividend rates and other relative rights
and preferences of the respective series and classes, shall
determine in good faith will result in fair and equitable
treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration
any shares of stock of the Corporation unless the Corporation
could, under paragraph (A) of this Section 2.8.4, purchase or
otherwise acquire such shares at such time and in such manner.
<PAGE>
2.8.5 Reacquired Shares. Any shares of Series A Preferred
Stock purchased or otherwise acquired by the Corporation in any
manner whatsoever shall be retired and canceled promptly after
the acquisition thereof. All such shares shall upon their
cancellation become authorized but unissued shares of Preferred
Stock and may be reissued as part of a new series of Preferred
Stock subject to the conditions and restrictions on issuance set
forth herein, in the Certificate of Incorporation of the
Corporation (the "Certificate of Incorporation"), or in any other
Certificate of Designations creating a series of Preferred Stock
or any similar stock or as otherwise required by law.
2.8.6 Liquidation, Dissolution or Winding Up. Upon any
liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (a) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock
unless, prior thereto, the holders of shares of Series A
Preferred Stock shall have received $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 Stock
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 Common Stock, or (b) to the holders
of shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except distributions made ratably on the
Series A Preferred Stock and all such parity stock 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 Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common Stock,
or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common
Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the aggregate amount to which holders of
shares of Series A Preferred Stock were entitled immediately
prior to such event under the proviso in clause (a) of the
preceding sentence shall be adjusted by multiplying such amount
by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
2.8.7 Consolidation, Merger, etc. In case the Corporation
shall enter into any consolidation, merger, combination or other
transaction in which the shares of Common Stock are exchanged for
or changed into other stock or securities, cash and/or any other
property, then in any such case each share of Series A Preferred
Stock 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
stock, securities, cash and/or any other property (payable in
kind), as the case may be, into which or for which each share of
Common Stock is changed or exchanged. In the event the
Corporation shall at any time declare or pay any dividend on the
Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater
or lesser number of shares of Common Stock, then in each such
case the amount set forth in the preceding sentence with respect
to the exchange or change of shares of Series A Preferred Stock
shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
2.8.8 No Redemption. The shares of Series A Preferred Stock
shall not be redeemable.
2.8.9 Rank. The Series A Preferred Stock shall rank, with
respect to the payment of dividends and the distribution of
assets, junior to all series of any other class of the Preferred
Stock.
<PAGE>
2.8.10 Amendment. The Corporation's Articles of Incorporation
shall not be amended in any manner that would materially alter or
change the powers, preferences or special rights of the Series A
Preferred Stock so as to affect them adversely without the
affirmative vote of the holders of at least two-thirds of the
outstanding shares of Series A Preferred Stock, voting together
as a single class.
IN WITNESS WHEREOF, this Certificate of Designations is executed
on behalf of the Corporation by its Senior Vice President,
Finance and Operations, and attested by its Secretary this 21st
day of January, 1997.
/S/ ROBERT M. LITTAUER
------------------------------
Robert M. Littauer
Senior Vice President, Finance and Operations
Attest:
/S/ JOHN M. BRENNEMAN
- -------------------------------
Secretary
<PAGE>
EXHIBIT B
FORM OF RIGHT CERTIFICATE
Certificate No. R- _____ Rights
NOT EXERCISABLE AFTER JANUARY 27, 2007 OR EARLIER IF
REDEMPTION OR EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT
TO REDEMPTION AT $.0001 PER RIGHT AND TO EXCHANGE ON
THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.
RIGHT CERTIFICATE
OSTEX INTERNATIONAL, INC.
This certifies that ____________________, or registered assigns,
is the registered owner of the number of Rights set forth above,
each of which entitles the owner thereof, subject to the terms,
provisions and conditions of the Rights Agreement, dated as of
January 21, 1997 (the "Rights Agreement"), between Ostex
International, Inc., a Washington corporation (the "Company"),
and ChaseMellon Shareholder Services L.L.C. (the "Rights Agent"),
to purchase from the Company at any time after the Distribution
Date (as such term is defined in the Rights Agreement) and prior
to 5:00 P.M., Seattle time, on January 27, 2007 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 non-assessable
share of Series A Junior Participating Preferred Stock, par value
$.01 per share (the "Preferred Shares"), of the Company, at a
purchase price of $38 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 that may be purchased upon exercise hereof) set forth
above, and the Purchase Price set forth above, are the number and
Purchase Price as of January 27, 1997, 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 that may be purchased upon the
exercise of the Rights evidenced by this Right Certificate are
subject to modification and adjustment upon the happening of
certain events.
This Right Certificate is subject to all 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 executive offices of the Company and the offices of 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 $.0001 per Right or (ii) may be
exchanged in whole or in part for shares of the Company's Common
Stock, par value $.01 per share, or for Preferred Shares.
No fractional Preferred 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
<PAGE>
Share, that 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 shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the
Preferred Shares or of any other securities of the Company that
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 directors 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. Dated as of__________________.
OSTEX INTERNATIONAL, INC.
By_________________________________
Its:_______________________________
COUNTERSIGNED:
[______________________]
By______________________________
Authorized Signature
<PAGE>
--Form of Reverse Side of Right Certificate--
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate)
FOR VALUE RECEIVED________________________________________________________
hereby sells, assigns and transfers unto _________________________________
__________________________________________________________________________
(Please print name and address of transferee)
this Right Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and
appoint __________________ as Attorney, to transfer this Right Certificate
on the books of the within-named Company, with full power of
substitution.
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 such terms are
defined in the Rights Agreement).
Dated: __________________________
Signature: _____________________________
Signature Guarantee*
_______________________________
*Your signature must be guaranteed by an eligible guarantor
institution (a bank, stock brokerage firm, savings and loan
association or credit union with membership in an approved
signature medallion program).
- -----------------------------------------------------------------
<PAGE>
--Form of Reverse Side of Right Certificate--
(continued)
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise
Rights represented by the Right Certificate.)
To:OSTEX INTERNATIONAL, INC.
The undersigned hereby irrevocably elects to exercise
_____________________ Rights represented by this Right
Certificate to purchase the Preferred Shares issuable upon the
exercise of such Rights and requests that certificates for such
Preferred Shares be issued in the name of:
Please insert social security or other identifying number
__________________________________________________________________________
(Please print name and address)
___________________________________________________________________________
If such number of Rights shall not be all the Rights evidenced by
this Right Certificate, a new Right Certificate for the balance
remaining of such Rights shall be registered in the name of and
delivered to:
Please insert social security or other identifying number
__________________________________________________________________________
(Please print name and address)
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).
Dated:_______________________
Signature:____________________________
Signature Guarantee*
___________________________
*Your signature must be guaranteed by an eligible guarantor
institution (a bank, stock brokerage ruin, savings and loan
association or credit union with membership in an approved
signature medallion program).
- -----------------------------------------------------------------
<PAGE>
--Form of Reverse Side of Right Certificate--
(continued)
- -----------------------------------------------------------------
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
on the face of this Right Certificate in every particular,
without alteration or enlargement or any change whatsoever.
In the event the certification set forth above in the Form of
Assignment or the Form of Election to Purchase, as the case may
be, is not completed, the Company and the Rights Agent will deem
the beneficial owner of the Rights evidenced by this Right
Certificate to be an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.
<PAGE>
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES
On January 10, 1997, the Board of Directors (the "Board of
Directors") of Ostex International, Inc. (the "Company") declared
a dividend of one preferred share purchase right (a "Right") for
each outstanding share of common stock, par value $.01 per share
(the "Common Shares"), of the Company. The dividend is payable
on January 27, 1997 (the "Record Date") to the shareholders of
record on that date. Each Right entitles the registered holder
to purchase from the Company one one-hundredth of share of Series
A Junior Participating Preferred Stock, par value $.01 per share
(the "Preferred Shares"), of the Company at a price of $38 per
one one-hundredth of a Preferred Share (the "Purchase Price"),
subject to adjustment. The description and terms of the Rights
are set forth in a Rights Agreement (the "Rights Agreement")
between the Company and ChaseMellon Shareholder Services L.L.C.,
as Rights Agent (the "Rights Agent").
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 action
of the Board of Directors prior to such time as any person or
group of affiliated persons 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 called the "Distribution Date"), the Rights will be
evidenced, with respect to any of the Common Share certificates
outstanding as of the Record Date, by such Common Share
certificate with a copy of this Summary of Rights attached
thereto.
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. Until
the Distribution Date (or earlier redemption or expiration of the
Rights), new Common Share certificates issued after the Record
Date upon transfer or new issuance of Common Shares will contain
a notation incorporating the Rights Agreement by reference.
Until the Distribution Date (or earlier redemption or expiration
of the Rights), the surrender for transfer of any certificates
for Common Shares outstanding as of the Record Date, even without
such notation or a copy of this Summary of Rights being attached
thereto, will also constitute the transfer of the Rights
associated with the Common Shares represented by such
certificate. As soon as practicable following the Distribution
Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Common
Shares as of the close of business on the Distribution Date, and
such separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The
Rights will expire on January 27, 2007 (the "Final Expiration
Date"), unless the Final Expiration Date is extended or unless
the Rights are earlier redeemed or exchanged by the Company, 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 stock dividend on, or a
subdivision, combination or reclassification of, the Preferred
Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights or warrants to subscribe for or purchase Preferred
Shares at a price, or securities convertible into Preferred
<PAGE>
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 stock
split of the Common Shares or a stock dividend on the Common
Shares payable in Common Shares or subdivisions, consolidations
or combinations of the Common Shares occurring, in any such case,
prior to the Distribution Date.
Preferred Shares purchasable upon exercise of the Rights will not
be redeemable. Each Preferred Share will be entitled to a
minimum preferential quarterly dividend payment of $1 per share,
but will be entitled to an aggregate dividend of 100 times the
dividend declared per Common Share. In the event of liquidation,
the holders of the Preferred Shares will be entitled to a minimum
preferential liquidation payment of $100 per share, but will be
entitled to an aggregate payment 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 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 Preferred Shares' dividend,
liquidation and voting rights, the value of the one one-hundredth
interest in a Preferred Share purchasable upon exercise of each
Right should approximate the value of one Common Share.
If 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 will be made so that each
holder of a Right will thereafter have the right to receive, upon
the exercise thereof at the then current exercise price of the
Right, that number of shares of common stock of the acquiring
company that at the time of such transaction will have a market
value of two times the exercise price of the Right. If any
person or group of affiliated or associated persons becomes an
Acquiring Person, proper provision shall be made so that 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 that number of Common
Shares having a market value of two times the exercise price of
the Right.
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 (other than fractions that 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 after any person or group becomes an Acquiring Person
and prior to the acquisition by such person or group of 50% or
more of the outstanding Common Shares, the Board of Directors may
exchange the Rights (other than Rights owned by such person or
group that will have become void), in whole or in part, at an
exchange ratio of one Common Share, or one one-hundredth of a
Preferred Share, per Right (subject to adjustment).
<PAGE>
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
$.0001 per Right (the "Redemption Price"). The redemption of the
Rights may be made effective at such time on such basis 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 Directors
without the consent of the holders of the Rights, including an
amendment to lower certain thresholds described 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%, except that, from
and after such time as any person or group of affiliated or
associated persons becomes an Acquiring Person, no such amendment
may adversely affect the interests of the holders of the Rights.
The ability of the Board of Directors to amend the terms of the
Rights is in addition to and in no way limits the discretion of
the Board of Directors to redeem the Rights.
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.
A copy of the Rights Agreement will be filed with the Securities
and Exchange Commission as an Exhibit to a Registration Statement
on Form 8-A. A copy of the Rights Agreement is available free of
charge from the Company. This summary description of the Rights
does not purport to be complete and is qualified in its entirety
by reference to the Rights Agreement, which is hereby
incorporated herein by reference.
