<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
CBT GROUP PUBLIC LIMITED COMPANY
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(Exact name of Registrant as specified in its charter)
Republic of Ireland N.A.
- ---------------------------------------- ---------------------------
(State of incorporation or organization) (IRS Employer
Identification No.)
1005 Hamilton Court
Menlo Park, California 94025
(Address of principal executive offices) (Zip Code)
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Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
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None None
If this form relates to the registration of a class of securities pursuant
to Section 12(b) of the Exchange Act and is effective pursuant to General
Instruction A.(c), check the following box. [ ]
If this form relates to the registration of a class of securities pursuant
to Section 12(g) of the Exchange Act and is effective pursuant to General
Instruction A.(d), check the following box. [X]
Securities Act registration statement file number to which this form
relates:
___________ (if applicable)
Securities to be registered pursuant to Section 12(g) of the Act:
Subscription Rights
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(Title of Class)
<PAGE>
Item 1. Description of Securities to be Registered.
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On October 4, 1998, the Board of Directors of CBT Group PLC (the
"Company") adopted a Subscription Rights Declaration, pursuant to which one
Subscription Right (a "Right") was granted for each outstanding ordinary share,
nominal value IR9.375p (the "Shares"), of the Company. Each Right entitles the
registered holder to purchase from the Company one Share at a price of $65.00
per Share, subject to adjustment (the "Purchase Price"). The description and
terms of the Rights are set forth in the Subscription Rights Declaration, which
is filed herewith as Exhibit 4.1 (the "Rights Declaration").
Until the earlier to occur of 10 days after (i) the public
announcement that a person or group of affiliated or associated persons (other
than the Company, a subsidiary of the Company or an employee benefit plan of
the Company or a subsidiary) (an "Acquiring Person") has acquired beneficial
ownership of 15% or more of the outstanding Shares (the "Shares Acquisition
Date") or (ii) 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 an Acquiring Person of 15% or more of such outstanding
Shares (the earlier of such dates being called the "Distribution Date"), the
Rights will be evidenced with respect to any of the Share certificates
outstanding by such Share certificate. Notwithstanding the foregoing, any
person or group of affiliated or associated persons who, at 12:00 midnight on
October 4, 1998, was the beneficial owner of at least 15% of the number of
Shares outstanding on such date will not be deemed an "Acquiring Person"
unless such person or group of affiliated or associated persons acquires
beneficial ownership of additional Shares at any time thereafter.
The Rights Declaration provides that, until the Distribution Date, the
Rights will be transferred with and only with the Shares. Until the
Distribution Date (or earlier cancellation or expiration of the Rights), new
Share certificates issued after the Record Date, upon transfer or new issuance
of Shares, will contain a notation incorporating the Rights Declaration by
reference. Until the Distribution Date (or earlier cancellation or expiration
of the Rights), the surrender for transfer of any certificates for Shares
outstanding as of the Record Date, even those without such notation, will also
constitute the transfer of the Rights associated with the 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 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 October 4, 2008 (the "Final Expiration Date") unless the
Rights are earlier canceled or exchanged by the Company, or the Rights Plan is
amended, in each case as described below.
The Purchase Price payable, and the number of 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, a bonus issue in respect of, or a subdivision, combination,
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consolidation or reclassification of, the Shares; (ii) upon the grant to holders
of the Shares of certain rights or warrants to subscribe for or purchase Shares
at a price, or securities convertible into Shares with a conversion price, less
than the then current market price of the Shares; or (iii) upon the distribution
to holders of the Shares of evidences of indebtedness or assets (excluding
regular quarterly cash dividends or dividends payable in Shares) or of
subscription rights or warrants (other than those referred to above).
The number of outstanding Rights and the number of Shares issuable upon
exercise of each Right are also subject to adjustment in the event of a stock
split of the Shares, a stock dividend on the Shares payable in Shares, a bonus
issue in respect of the Shares, or subdivisions, consolidations or combinations
of the Shares occurring, in any such case, prior to the Distribution Date.
In the event that any person becomes an Acquiring Person (a "Flip-In
Event"), each holder of a Right will thereafter generally have the right to
receive upon exercise that number of Shares having a market value of two times
the then current Purchase Price. Notwithstanding any of the foregoing,
following the occurrence of Flip-In Event all Rights that are, or (under
certain circumstances specified in the Rights Declaration) were, or subsequently
become beneficially owned by an Acquiring Person, related persons and
transferees will be null and void.
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 Shares will be issued. The Purchase Price
is payable by certified check, cashier's check, bank draft or money order.
At any time after a person becomes an Acquiring Person and prior to the
acquisition by any Acquiring Person of 50% or more of the outstanding Shares,
the Board of Directors of the Company may exchange the Rights (other than Rights
owned by any Acquiring Person which have become void), in whole or in part, at
an exchange ratio of one Share per Right (subject to adjustment). However, if a
majority of the Company's Board of Directors is elected by Shareholder action by
written consent, then for a period of 180 days following such election the
Rights cannot be exchanged if such exchange is reasonably likely to have the
purpose or effect of facilitating an acquisition of the Company by a person or
entity who proposed, nominated or supported a director of the Company so elected
by written consent (an "Interested Person").
At any time prior to a person becoming an Acquiring Person, the Board of
Directors of the Company may cancel the Rights in whole, but not in part.
Immediately upon any cancellation of the Rights, the right to exercise the
Rights will terminate. However, if a majority of the Company's Board of
Directors is elected by Shareholder action by written consent, then for a period
of 180 days following such election the Rights cannot be exchanged if such
exchange is reasonably likely to have the purpose or effect of facilitating an
acquisition of the Company by an Interested Person.
Other than provisions relating to principal economic terms of the Rights,
the terms of the Rights may be amended by the Board of Directors of the Company
without the consent of the holders of the Rights, except that from and after
the Distribution Date no such amendment may adversely affect the
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interests of the holders of the Rights. However, if a majority of the
Company's Board of Directors is elected by Shareholder action by written
consent, then for a period of 180 days following such election the Rights
cannot be exchanged if such exchange is reasonably likely to have the purpose
or effect of facilitating an acquisition of the Company by an Interested
Person.
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. Each Share in issue or hereafter issued by the
Company will receive one Right.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
without conditioning the offer on cancellation of the Rights or on a substantial
number of Rights being acquired. The Rights should not interfere with any
merger or other business combination approved by the Board of Directors of the
Company prior to the time that the Rights may not be canceled (as described
above) since the Board of Directors may, at its option, at any time until the
Shares Acquisition Date cancel all of the Rights. The Rights are designed to
provide additional protection against abusive takeover tactics such as offers
for all shares at less than full value or at an inappropriate time (in terms of
maximizing long-term shareholder value), partial tender offers and selective
open-market purchases. The Rights are intended to assure that the Company's
Board of Directors has the ability to protect shareholders and the Company if
efforts are made to gain control of the Company in manner that is not in the
best interests of the Company and its shareholders.
The foregoing description of the Rights does not purport to be complete and
is qualified in its entirety by reference to the Rights Declaration, which is
filed herewith as exhibit 4.1.
Item 2. Exhibits.
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4.1 Rights Declaration, which includes as Exhibit A the Form of
Subscription Rights Certificate.
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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, thereunto duly authorized.
CBT GROUP PLC
Date: October 5, 1998
By:/s/ Elizabeth K. Roemer
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Elizabeth K. Roemer
Vice President and
General Counsel
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CBT GROUP PLC
FORM 8-A
EXHIBIT INDEX
Exhibit
Number Description
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4.1 Rights Declaration, which includes as Exhibit A the Form of Subscription
Rights Certificate.
<PAGE>
EXHIBIT 4.1
CBT GROUP PUBLIC LIMITED COMPANY
DECLARATION OF SUBSCRIPTION RIGHTS
DATED AS OF OCTOBER 4TH, 1998
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TABLE OF CONTENTS
Page
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SECTION 1. CERTAIN DEFINITIONS 4
SECTION 2. EVIDENCE AND TRANSFER OF SUBSCRIPTION
RIGHTS CERTIFICATES 10
SECTION 3. FORM OF SUBSCRIPTION RIGHTS CERTIFICATES 11
SECTION 4. EXECUTION AND REGISTRATION 12
SECTION 5. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE
OF SUBSCRIPTION RIGHTS CERTIFICATES;
MUTILATED, DESTROYED, LOST OR STOLEN
SUBSCRIPTION RIGHTS CERTIFICATES 13
SECTION 6. EXERCISE OF SUBSCRIPTION RIGHTS; EXERCISE
PRICE; EXPIRATION DATE OF SUBSCRIPTION RIGHTS 14
SECTION 7. CANCELLATION OF SUBSCRIPTION RIGHTS CERTIFICATES 16
SECTION 8. RESERVATION AND AVAILABILITY OF ORDINARY SHARES 16
SECTION 9. NO SHAREHOLDER RIGHTS PRIOR TO EXERCISE 18
SECTION 10. ADJUSTMENT OF EXERCISE PRICE, NUMBER OF
SHARES OR NUMBER OF SUBSCRIPTION RIGHTS 18
SECTION 11. CERTIFICATE OF ADJUSTED EXERCISE PRICE OR
NUMBER OF SHARES 26
SECTION 12. FRACTIONAL SUBSCRIPTION RIGHTS AND FRACTIONAL
SHARES 26
SECTION 13. ISSUE OF NEW SUBSCRIPTION RIGHTS CERTIFICATES 27
SECTION 14. CANCELLATION 27
SECTION 15. EXCHANGE 28
SECTION 16. NOTICE OF CERTAIN EVENTS 30
SECTION 17. NOTICES 31
SECTION 18. SUPPLEMENTS AND AMENDMENTS 31
SECTION 19. DETERMINATIONS AND ACTIONS BY THE BOARD OF
DIRECTORS, ETC. 32
SECTION 20. SEVERABILITY 32
SECTION 21. GOVERNING LAW 33
SECTION 22. DESCRIPTIVE HEADINGS 33
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EXHIBITS
Exhibit A Form of Subscription Rights Certificate
Exhibit B Summary of Subscription Rights Declaration
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<PAGE>
On October 4th, 1998, the Board of Directors of the Company resolved to grant a
subscription right (a "SUBSCRIPTION RIGHT") in respect of each Ordinary Share
(as hereinafter defined), each Subscription Right representing the right to
purchase one Ordinary Share (subject to adjustment pursuant to the provisions
set out herein), upon and subject to the following terms and conditions.
SECTION 1 - CERTAIN DEFINITIONS
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For the purposes hereof, the following terms shall, save where the context
otherwise requires, have the meanings indicated:
(a) "ACQUIRING PERSON" shall mean any Person who or which, together with all
------------------
Affiliates and Associates of such Person, shall be the Beneficial Owner of
15% or more of the Ordinary Shares then in issue, but shall not include
the Company, any Subsidiary of the Company or any employee benefit plan of
the Company or of any Subsidiary of the Company, or any Person organized,
appointed or established by the Company for or pursuant to the terms of
any such plan. Notwithstanding the foregoing, no Person shall be deemed
to be an Acquiring Person:
(i) who was at the Record Date the Beneficial Owner of 15% or more of
the Ordinary Shares in issue; or
(ii) as the result of an acquisition by the Company of its own Ordinary
Shares which, by reducing the number of shares in issue, increases
the proportionate number of shares beneficially owned by such Person
to 15% or more of the Ordinary Shares then in issue;
provided, however, that if any such Person shall thereafter become the
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Beneficial Owner of any additional Ordinary Shares (other than pursuant to
a dividend or distribution paid or made by the Company in Ordinary Shares
or an issue by the Company of Ordinary Shares by way of a bonus issue or
pursuant to a split or subdivision of the Ordinary Shares), then such
Person shall be deemed to be an Acquiring Person if such Person then
beneficially owns 15% or more of the Ordinary Shares then in issue.
Notwithstanding the foregoing, if the Company's 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 (including, without
limitation, because:
(A) such Person was unaware of beneficially owning 15% or more of the
Ordinary Shares then in issue; or
(B) such Person was aware of the extent of the Ordinary Shares which
they beneficially owned but had no actual knowledge of the
consequences of such beneficial ownership hereunder)
and without any intention of changing or influencing control of the
Company, and if such Person divested or divests as promptly as practicable
a sufficient number of Ordinary Shares so that such Person no longer
beneficially owns 15% or more of the Ordinary Shares then in issue, then
such Person shall not be deemed to be or to have become an "Acquiring
Person" for any purposes hereof.
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(b) "ADJUSTMENT FRACTION" shall have the meaning set forth in Section 10(a)(i)
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hereof.
(c) "AFFILIATE" AND ASSOCIATE" shall have the respective meanings ascribed to
--------------------------
such terms in Rule 12b-2 of the General Rules and Regulations under the
Exchange Act, as in effect on the date hereof.
(d) A Person shall be deemed the "BENEFICIAL OWNER" of and shall be deemed to
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"BENEFICIALLY OWN" any securities:
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(i) which such Person or any of such Person's Affiliates or Associates
beneficially own, directly or indirectly, for purposes of Section
13(d) of the Exchange Act and Rule 13d-3 thereunder (or any
comparable or successor law or regulation);
(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 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 the Subscription Rights), warrants or
options, or otherwise; provided, however, that a Person shall
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not be deemed pursuant to this Section 1(d)(ii)(A) to be the
Beneficial Owner of, or to beneficially own:
(1) 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
(2) securities which a Person or any of such Person's
Affiliates or Associates may be deemed to have the right
to acquire pursuant to any merger or other acquisition
agreement between the Company and such Person (or one or
more of its Affiliates or Associates) if such agreement
has been approved by the Board of Directors of the
Company prior to there being an Acquiring Person; or
(B) the right to vote pursuant to any agreement, arrangement or
understanding; provided, however, that a Person shall not be
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deemed to be the Beneficial Owner of, or to beneficially own,
any security under this Section 1(d)(ii)(B) 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
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made pursuant to, and in accordance with, the applicable
rules and regulations of 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 (or any Affiliate or Associate thereof) with which such
Person or any of such Person's Affiliates or Associates has any
agreement, arrangement or understanding, whether or not in writing
(other than customary agreements with and between underwriters and
selling group members with respect to a bona fide public offering of
securities) for the purpose of acquiring, holding, voting (except to
the extent contemplated by the proviso to Section 1(d)(ii)(B)) or
disposing of any securities of the Company; provided, however, that
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in no case shall an officer or director of the Company be deemed:
(A) the Beneficial Owner of any securities beneficially owned by
another officer or director of the Company solely by reason of
actions undertaken by such persons in their capacity as officers
or directors of the Company; or
(B) the Beneficial Owner of securities held of record by the trustee
of any employee benefit plan of the Company or any Subsidiary of
the Company for the benefit of any employee of the Company or
any Subsidiary of the Company, other than the officer or
director, by reason of any influence that such officer or
director may have over the voting of the securities held in the
plan.
(e) "BUSINESS DAY" shall mean any day other than a Saturday, Sunday or a day
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on which banking institutions in New York are authorized or obliged by law
or executive order to close.
(f) "CANCELLATION DATE" shall have the meaning set forth in Section 14(a)
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hereof.
(g) "CLOSE OF BUSINESS" on any given date shall mean 5:00 p.m., New York City
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Time in the USA, on such date; provided, however, that if such date is not
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a Business Day it shall mean 5:00 p.m., New York City Time in the USA, on
the next succeeding Business Day.
(h) "COMPANY" shall mean CBT Group Public Limited Company, a public limited
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company incorporated under the laws of the Republic of Ireland.
(i) "CURRENT PER SHARE MARKET PRICE" of any security (a "Security" for the
--------------------------------
purposes of this definition), for all computations other than those made
pursuant to Section 10(a)(iii) hereof, shall mean the average of the daily
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closing prices per share of such Security for the thirty (30) consecutive
Trading Days immediately prior to but not including such date, and for
purposes of computations made pursuant to Section 10(a)(iii) hereof, the
Current Per Share Market Price of any Security on any date shall be deemed
to be the average of the daily closing prices per share of such Security
for the ten (10) consecutive Trading Days immediately prior to but not
including such date; provided, however, that in the event that the Current
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Per Share Market Price of the Security is determined during a period
following the announcement by the issuer of such Security of:
(i) a dividend or distribution on such Security payable in shares of
such Security or securities convertible into such shares;
(ii) a bonus issue; or
(iii) any subdivision, combination, consolidation or reclassification of
such Security;
and prior to the expiration of the applicable thirty (30) Trading Day or
ten (10) Trading Day period, after the ex-dividend date for such dividend
or distribution or the record date for such bonus issue, subdivision,
combination, consolidation or reclassification, as the case may be, 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 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 securities exchange, the last sale
price or, if such last sale price is not reported, the average of the high
bid and low asked prices in the over-the-counter market, as reported by
Nasdaq or such other system then in use, or, if on any such date the
Security is not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market maker
making a market in the Security selected by the Board of Directors of the
Company. If on any such date the Security is not 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 of the
Company, provided however that while the Ordinary Shares are represented
by American Depositary Shares ("ADSS") the security shall be the ADS and
the current per share market price of each Ordinary Share shall, for the
purposes of this definition, be calculated by reference to the current per
share market price of an ADS with any necessary adjustment being made to
reflect
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the fraction which an ADS bears to an Ordinary Share or the fraction which
an Ordinary Share bears to an ADS, as the case may be.
(j) "CURRENT VALUE" shall have the meaning set forth in Section 10(a)(iii)
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hereof.
(k) "DISTRIBUTION DATE" shall mean the earlier of:
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(i) the Close of Business on the tenth day after the Shares Acquisition
Date;
(ii) the Close of Business on the tenth day (or such later date as may be
determined by action of the Company's Board of Directors) after the
date that a tender or exchange offer 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 Person
organized, appointed or established by the Company for or pursuant
to the terms of any such plan) is first published or sent or given
within the meaning of Rule 14d-2(a) of the General Rules and
Regulations under the Exchange Act, if, assuming the successful
consummation thereof, such Person would be an Acquiring Person.
(l) "EQUIVALENT SHARES" shall mean Ordinary Shares and any other class or
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series of shares of the Company which is entitled to the same rights,
privileges and preferences as the Ordinary Shares.
(m) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended,
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of the USA.
(n) "EXERCISE PRICE" shall have the meaning set forth in Section 3(a) hereof.
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(o) "EXPIRATION DATE" shall mean the earliest to occur of:
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(i) the Close of Business on the Final Expiration Date; or
(ii) the Cancellation Date; or
(iii) the time at which the Board of Directors of the Company orders the
exchange of the Subscription Rights as provided in Section 15
hereof.
(p) "FINAL EXPIRATION DATE" shall mean October 4th, 2008.
-----------------------
(q) "INTERESTED PERSON" with respect to a Transaction shall mean any Person
-------------------
who:
(i) is or will become an Acquiring Person if the Transaction were to be
consummated or an Affiliate or Associate of such a Person; and
(ii) is, or directly or indirectly proposed, nominated or financially
supported, a director of the Company in office at the time of
consideration of the Transaction in question who was elected by
written consent of shareholders.
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(r) "NASDAQ" shall mean the National Association of Securities Dealers, Inc.
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Automated Quotations System.
(s) "ORDINARY SHARES" shall mean the ordinary shares of IR9.375p each in the
-----------------
capital of the Company.
(t) "ORDINARY SHARE EQUIVALENTS" shall have the meaning set forth in Section
----------------------------
10(a)(iii) hereof.
(u) "PERSON" shall mean any individual, firm, company, other body corporate or
--------
other entity or trust and shall include any successor (by merger or
otherwise) of such entity or trust.
(v) "POST-EVENT TRANSFEREE" shall have the meaning set forth in Section 6(g)
-----------------------
hereof.
(w) "PRE-EVENT TRANSFEREE" shall have the meaning set forth in Section 6(g)
----------------------
hereof.
(x) "RECORD DATE" shall mean 12.00 midnight on October 4th, 1998.
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(y) "SECTION 10(A)(II) TRIGGER DATE" shall have the meaning set forth in
--------------------------------
Section 10(a)(iii) hereof.
(z) "SECURITIES ACT" shall mean the Securities Act of 1933, as amended, of the
----------------
USA.
(aa) "SHARES ACQUISITION DATE" shall mean the first date of public announcement
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(which, for purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 13(d) under the Exchange
Act) by the Company or an Acquiring Person that an Acquiring Person has
become such; provided that, if such Person is determined by the Company's
-------------
Board of Directors not to have become an Acquiring Person pursuant to
Section 1(a) hereof, then no Shares Acquisition Date shall be deemed to
have occurred.
(bb) "SPREAD" shall have the meaning set forth in Section 10(a)(iii) hereof.
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(cc) "SUBSCRIPTION RIGHTS CERTIFICATE" shall mean a certificate substantially
---------------------------------
in the form attached hereto as Exhibit A.
(dd) "SUBSIDIARY" shall mean the meaning assigned to such term by Section 155
------------
of the Companies Act, 1963, as amended, of the Republic of Ireland.
(ee) "SUBSTITUTION PERIOD" shall have the meaning set forth in Section
---------------------
10(a)(iii) hereof.
(ff) "SUMMARY OF THIS DECLARATION OF SUBSCRIPTION RIGHTS" shall mean a summary
----------------------------------------------------
hereof substantially in the form attached hereto as Exhibit B.
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(gg) "TOTAL EXERCISE PRICE shall have the meaning set forth in Section 3(a)
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hereof.
(hh) "TRADING DAY" shall mean a day on which the principal securities exchange
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on which a referenced security is listed or admitted to trading is open
for the transaction of business or, if a referenced security is not listed
or admitted to trading on any national securities exchange, a Business
Day.
(ii) "TRANSACTION" shall mean any acquisition of Ordinary Shares which would
-------------
result in a Person becoming an Acquiring Person.
(jj) A "TRIGGERING EVENT" shall be deemed to have occurred upon any Person
------------------
becoming an Acquiring Person.
SECTION 2 - EVIDENCE AND TRANSFER OF SUBSCRIPTION RIGHTS
- --------------------------------------------------------
(a) The Company will send a copy of the Summary of this Declaration of
Subscription Rights by first-class, postage-prepaid mail, to each of its
members as of the Record Date, at the address of such member shown in the
Register of Members of the Company maintained by the Company's transfer
agent and registrar.
(b) A copy of the Summary of this Declaration of Subscription Rights will also
be sent to each Person who becomes a holder of Ordinary Shares after the
Record Date at the same time as the share certificate relating to such
Ordinary Shares is sent to such person and all share certificates issued
after the Record Date shall bear the following legend:
THIS CERTIFIES THAT CERTAIN SUBSCRIPTION RIGHTS DECLARED AT A MEETING OF
THE BOARD OF DIRECTORS OF CBT GROUP PUBLIC LIMITED COMPANY HELD ON OCTOBER
4TH, 1998 AND AS SET OUT IN A DECLARATION OF SUBSCRIPTION RIGHTS, THE
TERMS OF WHICH ARE HEREBY INCORPORATED HEREIN BY REFERENCE, AND A COPY OF
WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICES OF CBT GROUP PUBLIC
LIMITED COMPANY. CBT GROUP PUBLIC LIMITED COMPANY WILL MAIL TO THE HOLDER
OF THIS CERTIFICATE A COPY OF THE DECLARATION OF SUBSCRIPTION RIGHTS
WITHOUT CHARGE AFTER RECEIPT OF A WRITTEN REQUEST THEREFOR. UNDER CERTAIN
CIRCUMSTANCES SET FORTH IN THE DECLARATION OF SUBSCRIPTION RIGHTS,
SUBSCRIPTION RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO IS, WAS OR
BECOMES AN ACQUIRING PERSON OR ANY AFFILIATE OR ASSOCIATE THEREOF (AS SUCH
TERMS ARE DEFINED IN THE DECLARATION OF SUBSCRIPTION RIGHTS), WHETHER
CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR BY ANY SUBSEQUENT HOLDER,
MAY BECOME NULL AND VOID.
(c) Until the Distribution Date the Subscription Rights will be held by the
members of the Company as registered in the Register of Members of the
Company and prima facie evidence of title to the Subscription Rights will
be constituted by the Ordinary Share certificates held by such members.
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(d) Until the earlier of the Distribution Date or the Expiration Date a
transfer of Ordinary Shares by a member of the Company will also transfer
the Subscription Rights, which will be incapable of transfer independently
of the Ordinary Shares with which they are associated.
(e) As soon as practicable after the Distribution Date, the Company will
prepare and execute, and will send or cause to be sent by first-class,
postage-prepaid mail, to each member holding Ordinary Shares as of the
Close of Business on the Distribution Date, at the address of such holder
shown in the Register of Members of the Company, a Subscription Rights
Certificate which shall be prima facie evidence of one Subscription Right
for each Ordinary Share so held, subject to adjustment as provided herein.
In the event that an adjustment in the number of Subscription Rights per
Ordinary Share has been made pursuant to Section 10 hereof, then, at the
time of distribution of the Subscription Rights Certificate, the Company
shall make the necessary and appropriate rounding adjustments (in
accordance with Section 12 hereof) so that Subscription Rights
Certificates representing only whole numbers of Ordinary Shares are
distributed. As of and after the Distribution Date, the Subscription
Rights may be transferred as permitted hereby, separately and apart from
any transfer of Ordinary Shares, and the holders of such Subscription
Rights Certificates as listed in the records of the Company or any
transfer agent or registrar for the Subscription Rights shall be the
record holders thereof.
SECTION 3 - FORM OF SUBSCRIPTION RIGHTS CERTIFICATES
- ----------------------------------------------------
(a) The Subscription Rights Certificates (and the forms of election to
purchase Ordinary Shares and of assignment to be printed on the reverse
thereof) shall be substantially in the form of Exhibit A hereto and may
have such marks of identification or designation and such legends,
summaries or endorsements printed thereon as the Board of Directors of the
Company may deem appropriate and as are not inconsistent with the
provisions hereof, 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 or automated quotation system, on which
the Subscription Rights may from time to time be listed or included, or
to conform to usage. Subject to the provisions of Section 10 and Section
13 hereof, the Subscription Rights Certificates, whenever distributed,
shall be dated as of the date of distribution thereof and shall on their
face entitle the holders thereof to purchase such number of Ordinary
Shares as shall be set forth therein at the price set forth therein
(such exercise price per Ordinary Share being hereinafter referred to as
the "EXERCISE PRICE" and the aggregate Exercise Price of all Ordinary
----------------
Shares issuable upon
-11-
<PAGE>
exercise of one Subscription Right being hereinafter referred to as the
"TOTAL EXERCISE PRICE"), but the number and type of securities
----------------------
purchasable upon the exercise of each Subscription Right and the Exercise
Price shall be subject to adjustment as provided herein.
(b) Any Subscription Rights Certificates issued pursuant to Section 2(e) or
Section 13 hereof that represents Subscription Rights beneficially owned
by:
(i) an Acquiring Person or any Associate or Affiliate of an Acquiring
Person;
(ii) a transferee of an Acquiring Person (or of any such Associate or
Affiliate) who becomes a transferee after the Acquiring Person
becomes such; or
(iii) a transferee of an Acquiring Person (or of any such Associate or
Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Subscription
Rights pursuant to either:
(A) a transfer (whether or not for consideration) from the Acquiring
Person to holders of equity interests in such Acquiring Person
or to any Person with whom such Acquiring Person has any
continuing agreement, arrangement or understanding regarding the
transferred Subscription Rights; or
(B) a transfer which the Company's Board of Directors has determined
is part of a plan, arrangement or understanding which has as a
primary purpose or effect avoidance of Section 6(g) hereof; or
(iv) any subsequent transferee receiving Subscription Rights from a Post-
Event Transferee or a Pre-Event Transferee, either directly or
through one or more intermediate transferees;
and any Subscription Rights Certificate issued pursuant to Section 5 or
Section 10 hereof upon transfer, exchange, replacement or adjustment of
any other Subscription Rights Certificate referred to in this Section
3(b), shall contain (to the extent feasible) the following legend:
THE SUBSCRIPTION RIGHTS REPRESENTED BY THIS SUBSCRIPTION RIGHTS
CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME
AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON
(AS SUCH TERMS ARE DEFINED IN THE DECLARATION OF SUBSCRIPTION RIGHTS).
ACCORDINGLY, THIS SUBSCRIPTION RIGHTS CERTIFICATE AND THE SUBSCRIPTION
RIGHTS REPRESENTED HEREBY SHALL BECOME NULL AND VOID IN THE CIRCUMSTANCES
SPECIFIED IN SECTION 6(g) OF THE DECLARATION OF SUBSCRIPTION RIGHTS.
SECTION 4 - EXECUTION AND REGISTRATION
- --------------------------------------
(a) Subscription Rights Certificates shall be sealed with the Common Seal of
the Company in the manner resolved by the Board of Directors of the
Company in accordance with the Company's Articles of Association.
-12-
<PAGE>
(b) Following the Distribution Date, the Company will keep or cause to be
kept, at such office as it may designate for such purpose, books for
registration and transfer of the Subscription Rights Certificates issued
hereunder. Such books shall show the names and addresses of the
respective holders of the Subscription Rights Certificates, the number of
Subscription Rights represented by each of the Subscription Rights
Certificates and the date of each of the Subscription Rights Certificates.
SECTION 5 - TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF SUBSCRIPTION RIGHTS
- -------------------------------------------------------------------------------
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN SUBSCRIPTION RIGHTS
- ----------------------------------------------------------------------
CERTIFICATES
- ------------
(a) Subject to the provisions of Sections 6(g), 12 and 15 hereof, at any time
after the Close of Business on the Distribution Date, and at or prior to
the Close of Business on the Expiration Date, any Subscription Rights
Certificate or Subscription Rights Certificates may be transferred, split
up, combined or exchanged for another Subscription Rights Certificate or
Subscription Rights Certificates, entitling the registered holder to
purchase a like number of Ordinary Shares (or, following a Triggering
Event, other securities, cash or other assets, as the case may be) as the
Subscription Rights Certificate or Subscription Rights Certificates
surrendered then entitled such holder to purchase.
(b) Any registered holder desiring to transfer, split up, combine or exchange
any Subscription Rights Certificate or Subscription Rights Certificates
shall make such request in writing delivered to the Company, and shall
surrender the Subscription Rights Certificate or Subscription Rights
Certificates to be transferred, split up, combined or exchanged at the
office of the Company designated in the Subscription Rights Certificates
for such purpose (the "DESIGNATED OFFICE").
-------------------
(c) The Company shall not be obliged to take any action whatsoever with
respect to the transfer of any such surrendered Subscription Rights
Certificate until the registered holder thereof shall have completed and
signed the certificate contained in the form of assignment on the reverse
side of such Subscription Rights Certificate and shall have provided such
additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company shall
reasonably request. Thereupon the Company shall, subject to Sections
6(g), 12 and 15 hereof, deliver to the person entitled thereto a
Subscription Rights Certificate or Subscription Rights 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
Subscription Rights Certificates.
(d) Upon receipt by the Company of evidence reasonably satisfactory to it of
the loss, theft, destruction or
-13-
<PAGE>
mutilation of a Subscription Rights Certificate, and, in case of loss,
theft or destruction, of an indemnity or security satisfactory to it, and,
at the Company's request, reimbursement to the Company of all reasonable
expenses incidental thereto, and upon surrender to the Company and
cancellation of the Subscription Rights Certificate if mutilated, the
Company will make and deliver a new Subscription Rights Certificate to the
registered holder in lieu of the Subscription Rights Certificate so lost,
stolen, destroyed or mutilated.
SECTION 6 - EXERCISE OF SUBSCRIPTION RIGHTS; EXERCISE PRICE; EXPIRATION DATE OF
- -------------------------------------------------------------------------------
SUBSCRIPTION RIGHTS
- -------------------
(a) Subject to Sections 6(g), 14(b) and 15(b) hereof, the registered holder of
any Subscription Rights Certificate may exercise the Subscription Rights
represented thereby (except as otherwise provided herein) in whole or in
part at any time after the Distribution Date and prior to the Close of
Business on the Expiration Date by surrender of the Subscription Rights
Certificate, with the form of election to purchase on the reverse side
thereof duly executed, to the Company at the Designated Office, together
with payment of the Exercise Price for each Ordinary Share (or, following
a Triggering Event, other securities, cash or other assets as the case may
be) in respect of which the Subscription Rights are being exercised and an
amount equal to any applicable tax or governmental charge required to be
paid under Section 8(g) hereof.
(b) The Exercise Price for each Ordinary Share issuable pursuant to the
exercise of a Subscription Right shall initially be US$65.00, which price
shall be subject to adjustment from time to time as provided in Section 10
hereof and shall be payable together with any other sum in lawful money of
the United States of America in accordance with Section 6(e) below.
(c) If, with respect to any Subscription Rights Certificate surrendered to the
Company for exercise, the certificate attached to the form of election to
purchase or form of assignment, as the case may be, has either not been
completed or indicates an affirmative response to clause 1 and/or clause 2
thereof, the Company may, in its absolute discretion, decide not to take
any further action with respect to such requested exercise or transfer.
(d) Upon receipt of a Subscription Rights Certificate representing exercisable
Subscription Rights, with the form of election to purchase duly executed,
accompanied by payment as provided in paragraph (a) above, the Company
shall, subject to paragraph (c) above and subject as hereinafter provided,
thereupon promptly request any transfer agent or registrar of the Ordinary
Shares to enter the name of the Person who has exercised the Subscription
Rights in its Register of Members and issue and deliver to such Person a
certificate or certificates for the number of Ordinary Shares subscribed
for, such
-14-
<PAGE>
certificate or certificates to be delivered to the address of the Person
exercising such Subscription Rights as specified in the Subscription
Rights Certificate. If, following a Triggering Event, cash, securities or
other assets are substituted for an allotment of shares as provided for in
Section 10(a)(iii) then in lieu of the issue of Ordinary Shares such will
be paid or transferred to the Person exercising such Subscription Rights.
(e) The payment of the Exercise Price (as adjusted pursuant to Section 10
hereof) and an amount equal to any applicable tax or governmental charge
required to be paid by the holder of such Subscription Rights Certificate
in accordance with Section 8(g) hereof, may be made in cash or by
certified bank check, cashier's check or bank draft payable to the order
of the Company. In the event that the Company is obliged to issue
securities of the Company other than Ordinary Shares, pay cash and/or
distribute other property pursuant to Section 10(a) hereof, the Company
will make all arrangements necessary so that such other securities, cash
and/or other property are available for distribution if and when necessary
to comply with the terms hereof.
(f) In case the registered holder of any Subscription Rights Certificate shall
exercise less than all the Subscription Rights to which that Person is
entitled thereby, a new Subscription Rights Certificate showing the
balance of such Subscription Rights shall be issued by the Company to such
person, or to such person's duly authorised assignee, subject to the
provisions of Section 5 and Section 12.
(g) Notwithstanding anything herein to the contrary, from and after the first
occurrence of a Triggering Event, any Subscription Rights beneficially
owned by:
(i) an Acquiring Person or an Associate or Affiliate of an Acquiring
Person;
(ii) a transferee of an Acquiring Person (or of any such Associate or
Affiliate) who becomes a transferee after the Acquiring Person
becomes such (a "POST-EVENT TRANSFEREE");
-----------------------
(iii) a transferee of an Acquiring Person (or of any such Associate or
Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Subscription
Rights pursuant to either:
(A) a transfer (whether or not for consideration) from the Acquiring
Person to holders of equity interests in such Acquiring Person
or to any Person with whom the Acquiring Person has any
continuing agreement, arrangement or understanding regarding the
transferred Subscription Rights; or
(B) a transfer which the Company's Board of Directors has determined
is part of a plan, arrangement or understanding which has as a
primary purpose or effect the avoidance of this Section 6(g) (a
"PRE-EVENT TRANSFEREE"); or
----------------------
-15-
<PAGE>
(iv) any subsequent transferee receiving Subscription Rights from a Post-
Event Transferee or a Pre-Event Transferee either directly or
through one or more intermediate transferees;
shall be null and void without any further action and no holder of such
Subscription Rights shall have any rights whatsoever with respect to such
Subscription Rights, whether under any provision hereof or otherwise. The
Company shall use all reasonable efforts to ensure that the provisions of
this Section 6(g) and of Section 3(b) hereof are complied with, but the
Company shall have no liability to any holder of Subscription Rights
Certificates or to any other Person as a result of the Company's failure
to make any determinations with respect to an Acquiring Person or any of
such Acquiring Person's Affiliates, Associates or transferees hereunder.
(h) Notwithstanding anything herein to the contrary, the Company shall not be
obliged to undertake any action with respect to any purported exercise of
Subscription Rights as set forth in this Section 6 unless, in addition to
having complied with the requirements of Section 6(a), the Person
purporting to exercise such rights has;
(i) properly completed and signed the certificate contained in the form
of election to purchase set forth on the reverse side of the
Subscription Rights Certificate surrendered in respect of such
exercise; and
(ii) provided such additional evidence of the identity of the Beneficial
Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company shall reasonably require.
SECTION 7 - CANCELLATION OF SUBSCRIPTION RIGHTS CERTIFICATES
- ------------------------------------------------------------
All Subscription Rights Certificates surrendered to the Company for the
purpose of exercise, transfer, split, combination or exchange shall be
cancelled by it, and no Subscription Rights Certificates shall be issued
in lieu thereof except as expressly permitted by any of the terms hereof.
SECTION 8 - RESERVATION AND AVAILABILITY OF ORDINARY SHARES
- -----------------------------------------------------------
(a) The Company will use its best efforts to maintain the number of authorized
and unissued Ordinary Shares, not reserved for another purpose, which will
be sufficient to permit the exercise in full of all outstanding
Subscription Rights.
(b) If the Company's Ordinary Shares are now or are hereafter listed on a
securities exchange or quotation system then so long as the Ordinary
Shares (and, following the occurrence of a Triggering Event, Ordinary
Shares and/or other securities of the Company) issuable and deliverable
upon exercise of the Subscription Rights are, as at the date of exercise
of the Subscription Rights, listed on a securities exchange or quotation
system, the Company shall use its best efforts to cause such shares to be
listed on
-16-
<PAGE>
the date of their allotment or as soon thereafter as practicable.
(c) In respect of any allotment of Ordinary Shares and/or other securities of
the Company made pursuant to the exercise of Subscription Rights the
Company will make such returns and filings as may be required under the
laws of or regulations in the Republic of Ireland.
(d) The Company shall use its best efforts to:
(i) file, as soon as practicable following the earliest date after the
first occurrence of a Triggering Event in which the consideration to
be delivered by the Company upon exercise of the Subscription Rights
is described in Section 10(a)(ii) or Section 10(a)(iii) hereof, or
as soon as is required by law following the Distribution Date, as
the case may be, a registration statement under the Securities Act
with respect to the securities to be allotted upon exercise of the
Subscription Rights on an appropriate form;
(ii) cause such registration statement to become effective as soon as
practicable after such filing; and
(iii) cause such registration statement to remain effective (with a
prospectus at all times meeting the requirements of the Securities
Act) until the earlier of:
(A) the date as of which the Subscription Rights are no longer
exercisable for such securities; and
(B) the Expiration Date.
The Company may temporarily suspend, for a period not to exceed ninety
(90) days after the date set forth in clause (i) of this Section 8(d), the
ability to exercise the Subscription Rights in order to prepare and file
such registration statement and permit it to become effective. Upon any
such suspension, the Company shall issue a public announcement stating
that the ability to exercise the Subscription Rights has been temporarily
suspended, as well as a public announcement at such time as the suspension
is no longer in effect.
(e) The Company will also take such action as may be appropriate under, or to
ensure compliance with, the securities or "blue sky" laws of the various
states of the USA in connection with the exercisability of the
Subscription Rights. Notwithstanding any provision hereof to the
contrary, the Subscription Rights shall not be exercisable in any
jurisdiction, unless the requisite qualification in such jurisdiction
shall have been obtained, or an exemption therefrom shall be available,
and until a registration statement has been declared effective.
(f) The Company will take all such action as may be necessary to ensure that
all Ordinary Shares (or other securities of the Company) delivered upon
exercise of Subscription Rights shall, at the time of delivery of the
certificates
-17-
<PAGE>
for such securities (subject to payment of the Exercise Price together
with an amount equal to any applicable tax or governmental charge required
to be paid as provided in Section 8(g) below), be duly and validly
allotted and issued and fully paid and nonassessable shares.
(g) The Company will pay when due and payable any and all taxes and
governmental charges assessable on it in respect of the original issue or
delivery of the Subscription Rights Certificates or of any Ordinary Shares
(or other securities of the Company) upon the exercise of Subscription
Rights. The Company shall not, be liable for any other tax or
governmental charge which may arise as a result of the receipt, transfer,
cancellation or exercise of Subscription Rights or receipt, transfer,
cancellation or redemption of Ordinary Shares (or other securities of the
Company) any such tax or governmental charge being payable by the holder
of such Subscription Rights Certificate at the time of surrender thereof.
SECTION 9 - NO SHAREHOLDER RIGHTS PRIOR TO EXERCISE
- ---------------------------------------------------
(a) As soon as the name of the Person exercising Subscription Rights pursuant
to Section 6 has been entered in the Company's Register of Members that
Person shall be a Member of the Company with all the rights of a holder of
Ordinary Shares in the Company.
(b) Prior to becoming a member of the Company, the holder of a Subscription
Rights Certificate shall not be entitled to nor shall anything contained
herein or in any Subscription Rights Certificate be construed to confer
upon the holder of any Subscription Rights, as such, any of the rights of
a shareholder of the Company, including, without limitation, the right to
vote, to receive dividends or other distributions, to exercise any
preemptive rights, to receive any notice of any proceedings of the
Company, to vote for the election of directors or upon any matter
submitted to shareholders at any meeting thereof, to give or withhold
consent to any corporate action, or to receive notice of meetings or other
actions affecting shareholders, to receive subscription rights, or
otherwise, until the Subscription Right or Subscription Rights shall have
been exercised in accordance with the provisions hereof.
SECTION 10 - ADJUSTMENT OF EXERCISE PRICE, NUMBER OF SHARES OR NUMBER OF
- ------------------------------------------------------------------------
SUBSCRIPTION RIGHTS
- -------------------
The Exercise Price, the number and kind of shares or other property
covered by each Subscription Right and the number of Subscription Rights
outstanding are subject to adjustment from time to time as provided in
this Section 10.
(a) (i) In the event that the Company shall at any time after the date
hereof:
(A) declare a dividend on the Ordinary Shares payable in Ordinary
Shares;
-18-
<PAGE>
(B) make a bonus issue in respect of its Ordinary Shares;
(C) subdivide its Ordinary Shares;
(D) combine or consolidate its Ordinary Shares (by reverse share
split or otherwise) into a smaller number of Ordinary Shares; or
(E) issue any shares in the capital of the Company in a
reclassification of the Ordinary Shares (including any such
reclassification in connection with a consolidation or merger in
which the Company is the continuing or surviving corporation);
then, in each such event, except as otherwise provided in this
Section 10 and Section 6(g) hereof:
(1) the Exercise Price in effect at the time of the record date for
such dividend or bonus issue or of the effective date of such
subdivision, combination, consolidation or reclassification
shall be adjusted so that the Exercise Price thereafter shall
equal the result obtained by (x) dividing the Exercise Price in
effect immediately prior to such time by (y) the number or
fraction obtained by dividing the total number of Ordinary
Shares (or shares in the capital of the Company issued in such
reclassification of the Ordinary Shares) in issue immediately
following such time by the total number of Ordinary Shares in
issue immediately prior to such time (the "ADJUSTMENT
-----------
FRACTION"),; provided, however, that in no event where any
-------- -------
consideration is to be paid upon the exercise of one
Subscription Right shall that consideration be less than the
aggregate par value of the shares in the capital of the Company
issuable upon the exercise of such Subscription Right; and
(2) the number of Ordinary Shares (or other shares in the capital of
the Company) issuable upon the exercise of each Subscription
Right shall equal the number of Ordinary Shares (or such other
shares) as were issuable upon exercise of a Subscription Right
immediately prior to the occurrence of the event described in
paragraphs (A)-(E) of this Section 10(a)(i), multiplied by the
Adjustment Fraction.
Each Ordinary Share that shall be issued after an adjustment has
been made pursuant to this Section 10(a)(i) shall have associated
with it the number of Subscription Rights, exercisable at the
Exercise Price and for the number of Ordinary Shares (or such other
shares in the capital of the Company) as one Ordinary Share has
associated with it immediately following the adjustment made
pursuant to this Section 10(a)(i).
(ii) Subject to Section 15 hereof, in the event a Triggering Event shall
have occurred, then promptly following such Triggering Event each
holder of a
-19-
<PAGE>
Subscription Right, except as provided in Section 6(g)
hereof, shall thereafter have the right to receive for each
Subscription Right, upon exercise thereof in accordance with the
terms hereof and payment of the Exercise Price in effect immediately
prior to the occurrence of the Triggering Event, such number of
Ordinary Shares of the Company as shall equal the result obtained by
multiplying the Exercise Price in effect immediately prior to the
occurrence of the Triggering Event by the number of Ordinary Shares
for which a Subscription Right was exercisable (or would have been
exercisable if the Distribution Date had occurred) immediately prior
to the first occurrence of a Triggering Event, and dividing that
product by 50% of the Current Per Share Market Price for Ordinary
Shares on the date of occurrence of the Triggering Event; provided,
---------
however, that the Exercise Price and the number of Ordinary Shares
-------
of the Company so receivable upon exercise of a Subscription Right
shall be subject to further adjustment as appropriate in accordance
with Section 10(e) hereof to reflect any events occurring in respect
of the Ordinary Shares of the Company after the occurrence of the
Triggering Event.
(iii) In lieu of issuing Ordinary Shares in accordance with Section
10(a)(ii) hereof, the Company's Board of Directors may, if it
determines that such action is necessary or appropriate and not
contrary to the interest of holders of Subscription Rights and, in
the event that the number of Ordinary Shares which are authorized by
the Company's Memorandum and Articles of Association but not issued
or reserved for issue for purposes other than upon exercise of the
Subscription Rights are not sufficient to permit the exercise in
full of the Subscription Rights, or if any necessary shareholder or
regulatory approval for such issue has not been obtained by the
Company, the Company shall:
(A) determine the excess of (1) the value of the Ordinary Shares
issuable upon the exercise of a Subscription Right (the "CURRENT
--------
VALUE") over (2) the Exercise Price (such excess, the "SPREAD");
------ --------
and
(B) with respect to each Subscription Right, make adequate provision
to deliver, in substitution for such Ordinary Shares, upon
exercise of the Subscription Rights:
(1) cash;
(2) a reduction in or waiver of the Exercise Price;
(3) other equity securities of the Company (including,
without limitation, shares or units of shares of any
series of preferred shares which the Company's Board of
Directors has deemed to have the same value as Ordinary
Shares (such
-20-
<PAGE>
shares or units of shares of preferred shares are herein
called "ORDINARY SHARE EQUIVALENTS")), except to the
----------------------------
extent that the Company has not obtained any necessary
shareholder or regulatory approval for such issue;
(4) debt securities of the Company, except to the extent that
the Company has not obtained any necessary shareholder or
regulatory approval for such issue;
(5) other assets; or
(6) any combination of the foregoing;
having an aggregate value equal to the Current Value, where such aggregate
value has been determined by the Company's Board of Directors, based upon
the advice of a USA nationally recognized investment banking firm selected
by the Company's Board of Directors;
provided, however, if the Company shall not have made adequate provision
-------- -------
to deliver value pursuant to clause (B) above within thirty (30) days
following the later of:
(x) the first occurrence of a Triggering Event; or
(y) the date on which the Company's right of cancellation pursuant to
Section 14(a) expires;
(the later of which occurrence being referred to herein as the "SECTION
--------
10(A)(II) TRIGGER DATE"), then the Company shall be obliged to deliver,
-----------------------
upon the surrender for exercise of a Subscription Right and without
requiring payment of the Exercise Price, Ordinary Shares (to the extent
available), except to the extent that the Company has not obtained any
necessary shareholder or regulatory approval for such issue, and then, if
necessary, cash, which shares and/or cash have an aggregate value equal to
the Spread. If the Company's Board of Directors shall determine in good
faith that it is likely that sufficient additional Ordinary Shares could
be authorized for issue upon exercise in full of the Subscription Rights
or that any necessary regulatory approval for such issue will be obtained,
the thirty (30) day period set forth above may be extended to the extent
necessary, but not more than ninety (90) days after the Section 10(a)(ii)
Trigger Date, in order that the Company may seek shareholder approval for
any increase in the authorized share capital of the Company or any
authorization to allot shares or take action to obtain such regulatory
approval (such period, as it may be extended, the "SUBSTITUTION PERIOD").
---------------------
To the extent that the Company determines that some action need be taken
pursuant to the first and/or second sentences of this Section 10(a)(iii),
the Company:
(x) shall provide, subject to Section 6(g) hereof, that such action
shall apply uniformly to all outstanding Subscription Rights; and
(y) may suspend the ability to exercise the Subscription Rights until
the expiration of the Substitution Period in order to seek any
shareholders approval as aforesaid, to take any action to obtain any
required regulatory approval and/or to decide the appropriate form
of distribution to be made pursuant to such first sentence and to
determine the value thereof.
-21-
<PAGE>
In the event of any such suspension, the Company shall issue a
public announcement stating that the ability to exercise the
Subscription Rights has been temporarily suspended, and issue a
public announcement at such time as the suspension is no longer in
effect.
For purposes of this Section 10(a)(iii), the value of the Ordinary Shares
shall be the Current Per Share Market Price of the Ordinary Shares on the
Section 10(a)(ii) Trigger Date and the value of any Ordinary Share
Equivalents shall be deemed to have the same value as the Ordinary Shares
on such date.
(b) In case the Company shall, at any time after the date hereof, fix a record
date for the issue of rights, options or warrants to all holders of
Ordinary Shares or of any class or series of Equivalent Shares entitling
such holders (for a period expiring within forty-five (45) calendar days
after such record date) to subscribe for or purchase Ordinary Shares or
Equivalent Shares or securities convertible into Ordinary Shares or
Equivalent Shares at a price per share (or having a conversion price per
share, if a security convertible into Ordinary Shares or Equivalent
Shares) less than the then Current Per Share Market Price of the Ordinary
Shares or Equivalent Shares on such record date, then, in each such case,
the Exercise Price to be in effect after such record date shall be
determined by multiplying the Exercise Price in effect immediately prior
to such record date by a fraction, the numerator of which shall be the
number of Ordinary Shares and Equivalent Shares (if any) outstanding on
such record date, plus the number of Ordinary Shares or Equivalent Shares,
as the case may be, which the aggregate offering price of the total number
of Ordinary Shares or Equivalent Shares, as the case may be, to be offered
or issued (and/or the aggregate initial conversion price of the
convertible securities to be offered or issued) would purchase at such
current market price, and the denominator of which shall be the number of
Ordinary Shares and Equivalent Shares (if any) outstanding on such record
date, plus the number of additional Ordinary Shares or Equivalent Shares,
as the case may be, 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 where any consideration
-------- -------
is to be paid upon the exercise of one Subscription Right shall that
consideration be less than the aggregate par value of the shares in the
capital of the Company issuable upon exercise of one Subscription 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 Company's Board
of Directors, whose determination shall be binding on the holders of the
Subscription Rights. Ordinary Shares and Equivalent Shares owned by or
held for the account of the Company shall not be deemed to form part of
the issued share capital of the Company for the purpose of any such
-22-
<PAGE>
computation. Such adjustment shall be made successively whenever such a
record date is fixed, and in the event that such rights, options or
warrants are not so issued, the Exercise Price shall be adjusted to be the
Exercise Price which would then be in effect if such record date had not
been fixed.
(c) In case the Company shall, at any time after the date hereof, fix a record
date for the making of a distribution to all holders of Ordinary Shares or
of any class or series of Equivalent 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, if
any, or a dividend payable in Ordinary Shares) or subscription rights,
options or warrants (excluding those referred to in Section 10(b)), then,
in each such case, the Exercise Price to be in effect after such record
date shall be determined by multiplying the Exercise Price in effect
immediately prior to such record date by a fraction, the numerator of
which shall be the Current Per Share Market Price of an Ordinary Share or
an Equivalent Share on such record date, less the fair market value per
Ordinary Share or Equivalent Share (as determined in good faith by the
Board of Directors of the Company), of the portion of the cash, assets or
evidences of indebtedness so to be distributed or of such subscription
rights or warrants applicable to an Ordinary Share or Equivalent Share, as
the case may be, and the denominator of which shall be the Current Per
Share Market Price of an Ordinary Share or Equivalent Share on such record
date; provided, however, that in no event where any consideration is to be
-------- -------
paid upon the exercise of one Subscription Right shall that consideration
be less than the aggregate par value of the shares in the capital of the
Company issuable upon exercise of one Subscription Right. Such
adjustments shall be made successively whenever such a record date is
fixed, and in the event that such distribution is not so made, the
Exercise Price shall be adjusted to be the Exercise Price which would have
been in effect if such record date had not been fixed.
(d) Anything herein to the contrary notwithstanding, no adjustment in the
Exercise Price shall be required unless such adjustment would require an
increase or decrease of at least 1% in the Exercise Price; provided,
--------
however, that any adjustments which by reason of this Section 10(d) are
-------
not required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Section 10 shall
be made to the nearest cent or to the nearest ten-thousandth of an
Ordinary Share or other share, as the case may be. Notwithstanding the
first sentence of this Section 10(d), any adjustment required by this
Section 10 shall be made no later than the earlier of:
(i) three (3) years from the date of the transaction which requires such
adjustment; or
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(ii) the Expiration Date.
(e) If as a result of an adjustment made pursuant to Section 10(a) hereof, the
holder of any Subscription Right thereafter exercised shall become
entitled to receive any shares of the Company other than Ordinary Shares,
thereafter the number of such other shares so receivable upon exercise of
any Subscription Right and, if required, the Exercise Price thereof, 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
Ordinary Shares contained in Sections 10(a), 10(b), 10(c), 10(d), 10(f),
10(g), 10(h), 10(i), 10(j), 10(k) and 10(l), and the provisions of
Sections 6, 8, 9 and 12 with respect to the Ordinary Shares shall apply on
like terms to any such other shares.
(f) All Subscription Rights originally issued by the Company subsequent to any
adjustment made to the Exercise Price hereunder shall evidence the right
to purchase, at the adjusted Exercise Price, the number of Ordinary Shares
purchasable from time to time hereunder upon exercise of the Subscription
Rights, all subject to further adjustment as provided herein.
(g) Unless the Company shall have exercised its election as provided in
Section 10(h) below, upon each adjustment of the Exercise Price as a
result of the calculations made in Section 10(b) above, each Subscription
Right outstanding immediately prior to the making of such adjustment shall
thereafter evidence the right to purchase, at the adjusted Exercise Price,
that number of Ordinary Shares (calculated to the nearest ten-thousandth
of a share) obtained by (i) multiplying (x) the number of Ordinary Shares
covered by a Subscription Right immediately prior to this adjustment by
(y) the Exercise Price in effect immediately prior to such adjustment of
the Exercise Price, and (ii) dividing the product so obtained by the
Exercise Price in effect immediately after such adjustment of the Exercise
Price.
(h) The Company may elect on or after the date of any adjustment of the
Exercise Price as a result of the calculations made in Section 10(b) above
to adjust the number of Subscription Rights, in substitution for any
adjustment in the number of Ordinary Shares purchasable upon the exercise
of a Subscription Right. Each of the Subscription Rights outstanding
after such adjustment of the number of Subscription Rights shall be
exercisable for the number of Ordinary Shares for which a Subscription
Right was exercisable immediately prior to such adjustment. Each
Subscription Right held of record prior to such adjustment of the number
of Subscription Rights shall become that number of Subscription Rights
(calculated to the nearest ten-thousandth) obtained by dividing the
Exercise Price in effect immediately prior to adjustment of the Exercise
Price by the Exercise Price in effect immediately after adjustment of the
Exercise Price. The Company shall make a public announcement of its
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election to adjust the number of Subscription 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
Exercise Price is adjusted or any day thereafter, but, if the Subscription
Rights Certificates have been issued, shall be at least ten (10) days
later than the date of the public announcement. If Subscription Rights
Certificates have been issued, upon each adjustment of the number of
Subscription Rights pursuant to this Section 10(h), the Company shall, as
promptly as practicable, cause to be distributed to the holders of record
of Subscription Rights Certificates on such record date Subscription
Rights Certificates evidencing, subject to Section 12 hereof, the
additional Subscription 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 Subscription Rights Certificates held by such holders
prior to the date of adjustment, and upon surrender thereof, if required
by the Company, new Subscription Rights Certificates evidencing all the
Subscription Rights to which such holders shall be entitled after such
adjustment. Subscription Rights Certificates so to be distributed shall be
issued and executed in the manner provided for herein (and may bear, at
the option of the Company, the adjusted Exercise Price) and shall be
issued in the names of the holders of record of Subscription Rights
Certificates on the record date specified in the public announcement.
(i) Irrespective of any adjustment or change in the Exercise Price or the
number of Ordinary Shares issuable upon the exercise of the Subscription
Rights, the Subscription Rights Certificates theretofore and thereafter
issued may continue to express the Exercise Price per Ordinary Share and
the number of Ordinary Shares which were expressed in the initial
Subscription Rights Certificates issued hereunder.
(j) The Directors will not reduce the Exercise Price to a price below the par
value of the number of Ordinary Shares (or other shares in the capital of
the Company) issuable upon exercise of the Subscription Rights.
(k) In any case in which this Section 10 shall require that an adjustment in
the Exercise 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 Subscription Right exercised after such
record date of the number of Ordinary Shares and other shares in the
capital of the Company, if any, issuable upon such exercise over and above
the number of Ordinary Shares and other shares in the capital of the
Company, if any, issuable upon such exercise on the basis of the Exercise
Price in effect prior to such adjustment; provided, however, that the
-------- -------
Company shall deliver to such holder a due bill or other appropriate
instrument
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<PAGE>
evidencing such holder's right to receive such additional shares upon the
occurrence of the event requiring such adjustment.
(l) Anything in this Section 10 to the contrary notwithstanding, prior to the
Distribution Date, the Board of Directors of the Company shall be entitled
to make such reductions in the Exercise Price, in addition to those
adjustments expressly required by this Section 10, as and to the extent
that it in its sole discretion shall determine to be advisable in order
that any:
(i) consolidation or subdivision of the Ordinary Shares or any
Equivalent Shares;
(ii) issue wholly for cash of any Ordinary Shares or Equivalent Shares at
less than the current market price;
(iii) issue wholly for cash of Ordinary Shares or Equivalent Shares or
securities which by their terms are convertible into or exchangeable
for Ordinary Shares or Equivalent Shares;
(iv) share dividends; or
(v) issue of rights, options or warrants referred to in this Section 10;
hereafter made by the Company to holders of its Ordinary Shares shall not
be taxable to such shareholders.
(m) The Company will not, after the Distribution Date, except as permitted by
Sections 14, 15 or 18 hereof, take (or permit to be taken) any action if
at the time such action is taken it is reasonably foreseeable that such
action will diminish substantially or otherwise eliminate the benefits
intended to be afforded by the Subscription Rights.
SECTION 11 - CERTIFICATE OF ADJUSTED EXERCISE PRICE OR NUMBER OF SHARES
- -----------------------------------------------------------------------
Whenever an adjustment is made as provided in Section 10 hereof, the Company
shall promptly:
(a) prepare a certificate setting forth such adjustment and a brief statement
of the facts and computations accounting for such adjustment;
(b) file with the transfer agent or registrar for the Ordinary Shares a copy
of such certificate; and
(c) mail a brief summary thereof to each holder of a Subscription Rights
Certificate in accordance with Section 17 hereof.
Notwithstanding the foregoing, the failure of the Company to prepare or file
such certificate or give such notice shall not affect the validity of such
adjustment or the force or effect of the requirement for such adjustment.
SECTION 12 - FRACTIONAL SUBSCRIPTION RIGHTS AND FRACTIONAL SHARES
- -----------------------------------------------------------------
The Company will not issue fractions of Subscription Rights and all
Subscription Rights will be rounded down to the nearest whole number. The
Company will not issue fractions of Ordinary Shares upon the exercise or
exchange of Subscription Rights. The holder of a Subscription
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<PAGE>
Right by the exercise of that right expressly waives any right to
fractional shares to which he would otherwise have been entitled.
SECTION 13 - ISSUE OF NEW SUBSCRIPTION RIGHTS CERTIFICATES
- ----------------------------------------------------------
Notwithstanding any of the provisions hereof the Board of Directors of the
Company may, at its option, issue new Subscription Rights Certificates in
respect of Subscription Rights in such form as it may approve to reflect
any adjustment or change in the Exercise Price and the number or kind or
class of shares or other securities to be issued or property to be
purchased upon an exercise of the Subscription Rights. In addition, in
connection with the issue of Ordinary Shares following the Distribution
Date and prior to the cancellation or expiration of the Subscription
Rights, the Company:
(a) shall, with respect to Ordinary Shares so issued pursuant to the
exercise of share options or under any employee plan or arrangement
or upon the exercise, conversion or exchange of other securities of
the Company in issue at the date hereof or upon the exercise,
conversion or exchange of securities hereinafter issued by the
Company; and
(b) may, in any other case, if deemed necessary or appropriate by the
Board of Directors of the Company;
issue Subscription Rights Certificates representing the appropriate number
of Subscription Rights in connection with such issue or sale; provided,
--------
however, that:
-------
(i) no such Subscription Rights Certificate shall be issued and this
sentence shall be null and void ab initio if, and to the extent
---------
that, such issue or this sentence would create a significant risk of
or result in material adverse tax consequences to the Company or the
Person to whom such Subscription Rights Certificate would be issued
or would create a significant risk of or result in such options' or
employee plans' or arrangements' failing to qualify for otherwise
available special tax treatment; and
(ii) no such Subscription Rights Certificate shall be issued if, and to
the extent that, appropriate adjustment shall otherwise have been
made in lieu of the issue thereof.
SECTION 14 - CANCELLATION
- -------------------------
(a) The Board of Directors of the Company may, at any time prior to the
earlier of (i) the Distribution Date or (ii) the Close of Business on the
Final Expiration Date, cancel all but not less than all of the then
outstanding Subscription Rights. The date on which the Board of Directors
of the Company elects to make the cancellation effective shall be referred
to as the "CANCELLATION DATE."
--------------------
(b) Immediately upon the action of the Board of Directors of the Company
ordering the cancellation of the Subscription Rights, and without any
further action and without any notice, the right to exercise the
Subscription Rights will terminate. The Company shall promptly give
public notice
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<PAGE>
of any such cancellation; provided, however, that the failure to give
-------- -------
or any defect in, any such notice shall not affect the validity of such
cancellation. Within ten (10) days after the action of the Board of
Directors of the Company ordering the cancellation of the Subscription
Rights, the Company shall give notice of such cancellation to the holders
of the then outstanding Subscription Rights by mailing such notice to all
such holders at their last addresses as they appear in the books required
to be maintained pursuant to Section 4(b) hereof or, prior to the
Distribution Date, in the Register of Members of the Company. Any notice
which is mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice.
(c) Notwithstanding the provisions of Section 14(a) above, in the event that a
majority of the Board of Directors of the Company is elected by
shareholder action by written consent, then until the 180th day following
the effectiveness of such election the Subscription Rights shall not be
cancelled if such cancellation is reasonably likely to have the purpose or
effect of facilitating a Transaction with an Interested Person.
SECTION 15 - EXCHANGE
- ---------------------
(a) Subject to applicable laws, rules and regulations and subject to Section
15(c) below, the Board of Directors of the Company may at its option, at
any time after the occurrence of a Triggering Event, exchange all or part
of the then outstanding and exercisable Subscription Rights (which shall
not include Subscription Rights that have become null and void pursuant to
the provisions of Section 6(g) hereof) for Ordinary Shares, at an exchange
ratio of one Ordinary Share per Subscription Right, appropriately adjusted
as hereinbefore provided (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 Person
organized, appointed or established by the Company 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 Ordinary
Shares then outstanding.
(b) Immediately upon the action of the Board of Directors ordering the
exchange pursuant to this Section 15 and without any further action and
without any notice the right to exercise such Subscription Rights shall
terminate and the only right thereafter of the holders of such
Subscription Rights shall be to receive that number of Ordinary Shares
equal to the number of such Subscription Rights held by such holder
multiplied by the Exchange Ratio. The Company shall 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 shall mail a notice or any
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<PAGE>
such exchange to all of the holders of such Subscription Rights at their
last addresses as they appear in the books required to be maintained
pursuant to Section 4(b), or, prior to the Distribution Date, in the
Register of Members of the Company. Any notice which is mailed in the
manner herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of exchange will state the method by
which the exchange of the Ordinary Shares for Subscription Rights will be
effected and, in the event of any partial exchange, the number of
Subscription Rights which will be exchanged. Any partial exchange shall be
effected pro rata based on the number of Subscription Rights (other than
Subscription Rights which have become void pursuant to the provisions of
Section 6(g) hereof) held by each holder of Subscription Rights.
(c) In the event that there shall not be sufficient Ordinary Shares
authorized but unissued to permit any exchange of Subscription Rights as
contemplated in accordance with this Section 15, the Company shall
either take such action as may be necessary to authorize additional
Ordinary Shares for issue upon exchange of the Subscription Rights or
alternatively, at the option of a majority of the Board of Directors of
the Company, with respect to each Subscription Right:
(i) pay cash in an amount equal to the Current Value (as hereinafter
defined) in lieu of issuing Ordinary Shares in exchange therefor; or
(ii) issue debt or equity securities or a combination thereof, having a
value equal to the Current Value, in lieu of issuing Ordinary Shares
in exchange for each such Subscription Rights, where the value of
such securities shall be determined by a USA nationally recognized
investment banking firm selected by majority vote of the Board of
Directors of the Company and subject to the Company having obtained
any necessary shareholder or regulatory approval for such issue; or
(iii) subject to the matters aforesaid, deliver any combination of cash,
property, Ordinary Shares and/or other securities having a value
equal to the Current Value in exchange for each Subscription Rights.
For purposes of this Section 15(c) only, the "Current Value" shall mean
the product of the Current Per Share Market Price of Ordinary Shares on
the date of the occurrence of the event described above in subparagraph
(a), multiplied by the number of Ordinary Shares for which the
Subscription Right otherwise would be exchangeable if there were
sufficient shares available. To the extent that the Company determines
that some action need be taken pursuant to paragraphs (i), (ii) or (iii)
of this Section 15(c), the Board of Directors may temporarily suspend the
ability to exercise the Subscription Rights for a period of up to sixty
(60) days following the date on which the event described in Section 15(a)
or 15(f) shall have occurred, in order to seek any authorization of
additional Ordinary Shares and/or to decide the appropriate form of
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<PAGE>
distribution to be made pursuant to the above provision and to determine
the value thereof. In the event of any such suspension, the Company shall
issue a public announcement stating that the ability to exercise of the
Subscription Rights has been temporarily suspended.
(d) The Board of Directors of the Company may, by majority vote, at any time
before any Person has become an Acquiring Person, exchange all or part of
the then outstanding Subscription Rights for rights of substantially
equivalent value, as determined reasonably and with good faith by the
Board of Directors, based upon the advice of one or more USA nationally
recognized investment banking firms.
(e) Immediately upon the action of the Board of Directors ordering the
exchange of any Subscription Rights pursuant to subsection (d) of this
Section 15 and without any further action and without any notice, the
right to exercise such Subscription Rights shall terminate and the only
right thereafter of a holder of such Subscription Rights shall be to
receive that number of rights in exchange therefor as has been determined
by the Board of Directors in accordance with sub-section 15(d) above. The
Company shall 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 shall mail a notice of any
such exchange to all of the holders of such Subscription Rights at their
last addresses as they appear in the Register of Members of the Company.
Any notice which is mailed in the manner herein provided shall be deemed
given, whether or not the holder receives the notice. Each such notice of
exchange will state the method by which the exchange of the Subscription
Rights will be effected.
(f) Notwithstanding the provisions of this Section 15, in the event that a
majority of the Board of Directors of the Company is elected by
shareholder action by written consent, then until the 180th day following
the effectiveness of such election the Subscription Rights shall not be
exchanged for Ordinary Shares or rights of substantially equivalent value
if such exchange is reasonably likely to have the purpose or effect of
facilitating a Transaction with an Interested Person.
SECTION 16 - NOTICE OF CERTAIN EVENTS
- -------------------------------------
(a) In case the Company permits to occur any Triggering Event, the Company
shall give notice thereof to each holder of Subscription Rights in
accordance with Section 17 hereof at least twenty (20) days prior to the
occurrence of such Triggering Event.
(b) In case any Triggering Event shall occur, then, in any such case, the
Company shall as soon as practicable thereafter give to each holder of a
Subscription Rights Certificate, in accordance with Section 17 hereof, a
notice of the occurrence of such event, which shall
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<PAGE>
specify the event and the consequences of the event to holders of
Subscription Rights under Section 10(a)(ii).
SECTION 17 - NOTICES
- --------------------
Notices or demands to be given or made hereunder by the holder of any
Subscription Rights 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 notified to the holders of Subscription Rights Certificates by the
Company pursuant to the provisions of this clause) as follows:
Company: CBT Group Public Limited Company
Address: Beech Hill
Clonskeagh
Dublin 4
Ireland
Telephone: (353 1) 280 0077
Facsimile: (353 1) 283 1296
Attention: Company Secretary
with a copy to:
Binchys
43 Fitzwilliam Place
Dublin 2
Ireland
Telephone: (353 1) 661 6144
Facsimile: (353 1) 676 0198
Attention: Jennifer Caldwell
with a copy to:
Wilson Sonsini Goodrich & Rosati
Professional Corporation
650 Page Mill Road
Palo Alto, California 94304-1050
Telephone: (650) 493-9300
Facsimile: (650) 493-6811
Attention: Alan Austin
Notices or demands to be given or made hereunder by the Company to the holder of
any Subscription Rights 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 Register of Members of the Company or, after the
Distribution Date at such holder's address as it appears in the books required
to be maintained pursuant to Section 4(b) hereof.
SECTION 18 - SUPPLEMENTS AND AMENDMENTS
- ---------------------------------------
(a) Prior to the Distribution Date, the Company may supplement or amend the
terms hereof in any respect without the approval of any holders of
Subscription Rights. From and after the Distribution Date, the Board of
Directors of the Company may from time to time supplement or amend the
terms hereof without the approval of any holders of Subscription Rights
in order to:
(i) cure any ambiguity;
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<PAGE>
(ii) correct or supplement any provision contained herein which may be
defective or inconsistent with any other provisions herein;
(iii) shorten or lengthen any time period hereunder; or
(iv) change or supplement the provisions hereunder in any manner that
the Board of Directors of the Company may deem necessary or
desirable and that shall not adversely affect the interests of the
holders of Subscription Rights (other than an Acquiring Person or
an Affiliate or Associate of an Acquiring Person);
provided, that the terms hereof will not be supplemented or amended to
--------
lengthen, pursuant to clause (iii) of this Section 18(a):
(A) a time period relating to when the Subscription Rights may be
cancelled; or
(B) any other time period unless such lengthening is for the purpose of
protecting, enhancing or clarifying the rights of, and/or the
benefits to, the holders of Subscription Rights (other than an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person).
(b) Notwithstanding the provisions of Section 18(a), in the event that a
majority of the Board of Directors of the Company is elected by
shareholder action by written consent, then until the 180th day following
the effectiveness of such election, the terms hereof shall not be
supplemented or amended in any manner reasonably likely to have the
purpose or effect of facilitating a Transaction with an Interested
Person.
SECTION 19 - DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS, ETC
- ----------------------------------------------------------------------
For all purposes hereof, any calculation of the number of Ordinary Shares
in issue at any particular time, including for purposes of determining
the particular percentage of such issued Ordinary Shares of which any
Person is the Beneficial Owner, shall be made in accordance with the last
sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations
under the Exchange Act. The Board of Directors of the Company shall have
the exclusive power and authority to administer this Declaration and to
exercise all rights and powers specifically granted to the Board, or the
Company hereunder, or as may be necessary or advisable in the
administration hereof, including, without limitation, the right and power
to:
(i) interpret the provisions hereof; and
(ii) make all determinations deemed necessary or advisable for the
administration hereof (including a determination to cancel or not
cancel the Subscription Rights or to amend the terms hereof).
SECTION 20 - SEVERABILITY
- -------------------------
If any term, provision or restriction herein contained is held by a court
of competent jurisdiction or other authority to be invalid, void or
unenforceable, the
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<PAGE>
remainder of the terms, provisions and restrictions herein contained
shall remain in full force and effect and shall in no way be affected,
impaired or invalidated; provided, however, that notwithstanding
-------- -------
anything to the contrary herein contained, if any such term, provision or
restriction is held by such court or authority to be invalid, void or
unenforceable and the Board of Directors of the Company determines in its
good faith judgment that severing the invalid language from the terms
hereof would adversely affect the purpose or effect hereof, the right of
cancellation set forth in Section 14 hereof shall be reinstated and shall
not expire until the Close of Business on the tenth day following the
date of such determination by the Company's Board of Directors.
SECTION 21 - GOVERNING LAW
- --------------------------
This Declaration and each Subscription Right and each Subscription Rights
Certificate issued hereunder shall be deemed to be made under the laws of
the Republic of Ireland and for all purposes shall be governed by and
construed in accordance with the laws of the Republic of Ireland.
SECTION 22 - DESCRIPTIVE HEADINGS
- ---------------------------------
Descriptive headings of the several Sections herein are inserted for
convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
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<PAGE>
EXHIBIT A
---------
CBT GROUP PUBLIC LIMITED COMPANY
FORM OF SUBSCRIPTION RIGHTS CERTIFICATE
Certificate No. R- _________ Subscription Rights
NOT EXERCISABLE AFTER THE EARLIER OF (i) October 4, 2008 (ii) THE DATE
TERMINATED BY THE COMPANY OR (iii) THE DATE THE COMPANY EXCHANGES THE
SUBSCRIPTION RIGHTS PURSUANT TO THE DECLARATION OF SUBSCRIPTION RIGHTS.
THE SUBSCRIPTION RIGHTS ARE SUBJECT TO CANCELLATION, AT THE OPTION OF THE
COMPANY. [UNDER CERTAIN CIRCUMSTANCES, SUBSCRIPTION RIGHTS BENEFICIALLY
OWNED BY AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING
PERSON (AS SUCH TERMS ARE DEFINED IN THE DECLARATION OF SUBSCRIPTION
RIGHTS) AND ANY SUBSEQUENT HOLDER OF SUCH SUBSCRIPTION RIGHTS MAY BECOME
NULL AND VOID.] [THE SUBSCRIPTION RIGHTS REPRESENTED BY THIS SUBSCRIPTION
RIGHTS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR
BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING
PERSON (AS SUCH TERMS ARE DEFINED IN THE DECLARATION OF SUBSCRIPTION
RIGHTS). ACCORDINGLY, THIS SUBSCRIPTION RIGHTS CERTIFICATE AND THE
SUBSCRIPTION RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE
CIRCUMSTANCES SPECIFIED IN SECTION 6(g) OF SUCH DECLARATION OF SUBSCRIPTION
RIGHTS.]
SUBSCRIPTION RIGHTS CERTIFICATE
CBT GROUP PUBLIC LIMITED COMPANY
This certifies that ______________________________, or registered assigns, is
the registered owner of the number of Subscription Rights set forth above, each
of which entitles the owner thereof, subject to the terms, provisions and
conditions of the Declaration of Subscription Rights dated as of October 4,
1998, (the "DECLARATION OF SUBSCRIPTION RIGHTS"), to purchase from the Company
at any time after the Distribution Date (as such term is defined in the
Declaration of Subscription Rights) and prior to the close of Business on
October 4, 2008 at the office of the Company at Beech Hill, Clonskeagh, Dublin
4, Ireland, one fully paid Ordinary Share, (the "ORDINARY SHARES"), of the
Company, at a Exercise Price of $65 per Ordinary Share (the "EXERCISE PRICE"),
upon presentation and surrender of this Subscription Rights Certificate with the
Form of Election to Purchase and related Certificate duly executed. The number
of Subscription Rights evidenced by this Subscription Rights Certificate (and
the number of Ordinary Shares which may be purchased upon exercise hereof) set
forth above are the number and Exercise Price as of October 4, 1998 based on the
Ordinary Shares as constituted at such date. As provided in the Declaration of
Subscription Rights, the Exercise Price and the number and kind of Ordinary
Shares or other securities which may be purchased upon the exercise of the
Subscription Rights evidenced by this Subscription Rights Certificate are
subject to
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<PAGE>
modification and adjustment upon the happening of certain events.
This Subscription Rights Certificate is subject to all of the terms, provisions
and conditions of the Declaration of Subscription Rights, which terms,
provisions and conditions are hereby incorporated herein by reference and made a
part hereof Copies of the Declaration of Subscription Rights are on file at the
principal executive offices of the Company.
Subject to the provisions of the Declaration of Subscription Rights, the
Subscription Rights evidenced by this Subscription Rights Certificate may be
exchanged by the Company in whole or in part for Ordinary Shares, substantially
equivalent rights or other consideration as determined by the Company.
This Subscription Rights Certificate, with or without other Subscription Rights
Certificates, upon surrender may be exchanged for another Subscription Rights
Certificate or Subscription Rights Certificates of like tenor and date
evidencing Subscription Rights entitling the holder to purchase a like aggregate
amount of securities as the Subscription Rights evidenced by the Subscription
Rights Certificate or Subscription Rights Certificates surrendered shall have
entitled such holder to purchase. If this Subscription Rights Certificate shall
be exercised in part, the holder shall be entitled to receive upon surrender
hereof another Subscription Rights Certificate or Subscription Rights
Certificates for the number of whole Subscription Rights not exercised.
No fractional portion of an Ordinary Share will be issued upon the exercise of
any Right or Subscription Rights.
No holder of this Subscription Rights Certificate, as such, shall be entitled to
vote or receive dividends or be deemed for any purpose the holder of the
Ordinary Shares or of any other securities of the Company which may at any time
be issuable on the exercise hereof, nor shall anything contained in the
Declaration of Subscription Rights 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 Declaration of Subscription Rights, or
to receive dividends or subscription rights, or otherwise, until the Right or
Subscription Rights shall have been exercised as provided in the Declaration of
Subscription Rights.
WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal. Dated as of _______________, 19____.
ATTEST: [Company]
By: ____________________ By: ____________________
__________________, Secretary _________________, [Title]
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<PAGE>
FORM OF REVERSE SIDE OF SUBSCRIPTION RIGHTS CERTIFICATE
FORM OF ASSIGNMENT
------------------
(To be executed by the registered holder if such
holder desires to transfer the Subscription Rights Certificate)
FOR VALUE RECEIVED ___________________ hereby sells, assigns and transfers unto
- --------------------------------------------------------------------------------
(Please print name and address of transferee)
- --------------------------------------------------------------------------------
this Subscription Rights Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and appoint
__________________________ Attorney, to transfer the within Subscription Rights
Certificate on the books of the within-named Company, with full power of
substitution.
Dated: _______________, 19____
------------------------------
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company having an office or correspondent in
the United States.
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<PAGE>
CERTIFICATE
-----------
The undersigned hereby certifies by checking the appropriate boxes that:
(1) this Subscription Rights Certificate [ ] is [ ] is not being sold, assigned
and transferred by or on behalf of a Person who is or was an Acquiring
Person, or an Affiliate or Associate of any such Person (as such terms are
defined in the Declaration of Subscription Rights);
(2) after due inquiry and to the best knowledge of the undersigned, it [ ] did
[ ] did not acquire the Subscription Rights evidenced by this Subscription
Rights Certificate from any Person who is, was or subsequently became an
Acquiring Person or an Affiliate or Associate of any such Person.
Dated: _______________, 19____
------------------------------
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company having an office or correspondent in
the United States.
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<PAGE>
FORM OF REVERSE SIDE OF SUBSCRIPTION RIGHTS CERTIFICATE - CONTINUED
FORM OF ELECTION TO PURCHASE
----------------------------
(To be executed if holder desires to
exercise the Subscription Rights Certificate)
To: ___________________________
The undersigned hereby irrevocably elects to exercise _________________________
Subscription Rights represented by this Subscription Rights Certificate to
purchase the number of Ordinary Shares issuable upon the exercise of such
Subscription Rights and requests that certificates for such number of Ordinary
Shares issued in the name of:
Please insert social security
or other identifying number
- --------------------------------------------------------------------------------
(Please print name and address)
- --------------------------------------------------------------------------------
If such number of Subscription Rights shall not be all the Subscription Rights
evidenced by this Subscription Rights Certificate, a new Subscription Rights
Certificate for the balance remaining of such Subscription Rights shall be
registered in the name of and delivered to:
Please insert social security
or other identifying number
- --------------------------------------------------------------------------------
(Please print name and address)
- --------------------------------------------------------------------------------
Dated: ___________________ , 19____
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<PAGE>
------------------------------
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company having an office or correspondent in
the United States.
CERTIFICATE
-----------
The undersigned hereby certifies by checking the appropriate boxes that:
(1) the Subscription Rights evidenced by this Subscription Rights Certificate
[_] are [_] are not being exercised by or on behalf of a Person who is or
was an Acquiring Person or an Affiliate or Associate of any such Person (as
such terms are defined in the Subscription Rights Agreement);
----------------
(2) after due inquiry and to the best knowledge of the undersigned, it [_] did
[_] did not acquire the Subscription Rights evidenced by this Subscription
Rights Certificate from any Person who is, was or subsequently became an
Acquiring Person or an Affiliate or Associate of any such Person.
Dated: _______________, 19____
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<PAGE>
------------------------------
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company having an office or correspondent in
the United States.
FORM OF REVERSE SIDE OF SUBSCRIPTION RIGHTS CERTIFICATE - CONTINUED
NOTICE
------
The signature in the foregoing Forms of Assignment and Election must conform to
the name as written upon the face of this Subscription Rights Certificate in
every particular, without alteration or enlargement or any change whatsoever.
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<PAGE>
EXHIBIT B
---------
SUMMARY OF DECLARATION OF SUBSCRIPTION RIGHTS
On October 4, 1998, the Board of Directors of CBT Group PLC (the
"Company") adopted a Subscription Rights Declaration, pursuant to which one
Subscription Right (a "Right") was granted for each outstanding ordinary share,
nominal value IR9.375p (the "Shares"), of the Company. Each Right entitles the
registered holder to purchase from the Company one Share at a price of $65.00
per Share, subject to adjustment (the "Purchase Price"). The description and
terms of the Rights are set forth in the Subscription Rights Declaration.
Until the earlier to occur of 10 days after (i) the public
announcement that a person or group of affiliated or associated persons (other
than the Company, a subsidiary of the Company or an employee benefit plan of the
Company or a subsidiary) (an "Acquiring Person") has acquired beneficial
ownership of 15% or more of the outstanding Shares (the "Shares Acquisition
Date") or (ii) 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 an Acquiring Person of 15% or more of such outstanding
Shares (the earlier of such dates being called the "Distribution Date"), the
Rights will be evidenced with respect to any of the Share certificates
outstanding by such Share certificate. Notwithstanding the foregoing, any
person or group of affiliated or associated persons who, at 12:00 midnight on
October 4, 1998, was the beneficial owner of at least 15% of the number of
Shares outstanding on such date will not be deemed an "Acquiring Person" unless
such person or group of affiliated or associated persons acquires beneficial
ownership of additional Shares at any time thereafter.
The Rights Declaration provides that, until the Distribution Date, the
Rights will be transferred with and only with the Shares. Until the
Distribution Date (or earlier cancellation or expiration of the Rights), new
Share certificates issued after the Record Date, upon transfer or new issuance
of Shares, will contain a notation incorporating the Rights Declaration by
reference. Until the Distribution Date (or earlier cancellation or expiration of
the Rights), the surrender for transfer of any certificates for Shares
outstanding as of the Record Date, even those without such notation, will also
constitute the transfer of the Rights associated with the 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 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 October 4, 2008 (the "Final Expiration Date") unless the
Rights are earlier canceled or exchanged by the Company, or the Rights Plan is
amended, in each case as described below.
The Purchase Price payable, and the number of 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, a bonus issue in respect of, or a subdivision, combination,
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<PAGE>
consolidation or reclassification of, the Shares; (ii) upon the grant to holders
of the Shares of certain rights or warrants to subscribe for or purchase Shares
at a price, or securities convertible into Shares with a conversion price, less
than the then current market price of the Shares; or (iii) upon the distribution
to holders of the Shares of evidences of indebtedness or assets (excluding
regular quarterly cash dividends or dividends payable in Shares) or of
subscription rights or warrants (other than those referred to above).
The number of outstanding Rights and the number of Shares issuable upon
exercise of each Right are also subject to adjustment in the event of a stock
split of the Shares, a stock dividend on the Shares payable in Shares, a bonus
issue in respect of the Shares, or subdivisions, consolidations or combinations
of the Shares occurring, in any such case, prior to the Distribution Date.
In the event that any person becomes an Acquiring Person (a "Flip-In
Event"), each holder of a Right will thereafter generally have the right to
receive upon exercise that number of Shares having a market value of two times
the then current Purchase Price. Notwithstanding any of the foregoing,
following the occurrence of Flip-In Event all Rights that are, or (under
certain circumstances specified in the Rights Declaration) were, or subsequently
become beneficially owned by an Acquiring Person, related persons and
transferees will be null and void.
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 Shares will be issued. The Purchase Price
is payable by certified check, cashier's check, bank draft or money order.
At any time after a person becomes an Acquiring Person and prior to the
acquisition by any Acquiring Person of 50% or more of the outstanding Shares,
the Board of Directors of the Company may exchange the Rights (other than Rights
owned by any Acquiring Person which have become void), in whole or in part, at
an exchange ratio of one Share per Right (subject to adjustment). However, if a
majority of the Company's Board of Directors is elected by Shareholder action by
written consent, then for a period of 180 days following such election the
Rights cannot be exchanged if such exchange is reasonably likely to have the
purpose or effect of facilitating an acquisition of the Company by a person or
entity who proposed, nominated or supported a director of the Company so elected
by written consent (an "Interested Person").
At any time prior to a person becoming an Acquiring Person, the Board of
Directors of the Company may cancel the Rights in whole, but not in part.
Immediately upon any cancellation of the Rights, the right to exercise the
Rights will terminate. However, if a majority of the Company's Board of
Directors is elected by Shareholder action by written consent, then for a period
of 180 days following such election the Rights cannot be exchanged if such
exchange is reasonably likely to have the purpose or effect of facilitating an
acquisition of the Company by an Interested Person.
Other than provisions relating to principal economic terms of the Rights,
the terms of the Rights may be amended by the Board of Directors of the Company
without the consent of the
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<PAGE>
holders of the Rights, except that from and after the Distribution Date no such
amendment may adversely affect the interests of the holders of the Rights.
However, if a majority of the Company's Board of Directors is elected by
Shareholder action by written consent, then for a period of 180 days following
such election the Rights cannot be exchanged if such exchange is reasonably
likely to have the purpose or effect of facilitating an acquisition of the
Company by an Interested Person.
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. Each Share in issue or hereafter issued by the
Company will receive one Right.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
without conditioning the offer on cancellation of the Rights or on a substantial
number of Rights being acquired. The Rights should not interfere with any
merger or other business combination approved by the Board of Directors of the
Company prior to the time that the Rights may not be canceled (as described
above) since the Board of Directors may, at its option, at any time until the
Shares Acquisition Date cancel all of the Rights. The Rights are designed to
provide additional protection against abusive takeover tactics such as offers
for all shares at less than full value or at an inappropriate time (in terms of
maximizing long-term shareholder value), partial tender offers and selective
open-market purchases. The Rights are intended to assure that the Company's
Board of Directors has the ability to protect shareholders and the Company if
efforts are made to gain control of the Company in manner that is not in the
best interests of the Company and its shareholders.
The foregoing summary of the Rights does not purport to be complete and
is qualified in its entirety by reference to the Subscription Rights
Declaration.
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