SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
SOVRAN SELF STORAGE, INC.
________________________
(Exact name of registrant as specified in charter)
Maryland 16-1194043
______________________ ______________
(State or other jurisdiction (IRS employer
of incorporation) identification no.)
5166 Main Street, Williamsville, New York 14221
___________________________________________________
(Address of principal executive offices) (Zip code)
Securities to be registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which each class is
to be so registered to be registered
___________________ ______________________
Preferred Stock Purchase Rights New York Stock Exchange
Securities to be registered pursuant to Section 12(g) of the Act:
None
____
(Title of Class)
<PAGE>
Item 1. Description of Registrant's Securities to be Registered.
Effective on November 27, 1996, the Board of Directors of
the Company adopted a Shareholder Rights Agreement (the "Rights
Agreement"). The following description of the terms of the
Rights Agreement does not purport to be complete and is qualified
in its entirety by reference to the Rights Agreement which is
attached hereto as an exhibit and is incorporated herein by
reference.
Pursuant to the terms of the Rights Agreement, the Board of
Directors declared a dividend distribution of one Preferred Stock
Purchase Right (a "Right") for each outstanding share of Common
Stock of the Company (the "Common Stock") to stockholders of
record as of the close of business on December 16, 1996 (the
"Record Date"). In addition, one Right will automatically attach
to each share of Common Stock issued between the Record Date and
the Distribution Date (as hereinafter defined). Each Right
entitles the registered holder thereof to purchase from the
Company a unit consisting of one one-thousandth of a share (a
"Unit") of Series A Junior Participating Cumulative Preferred
Stock, par value $0.01 per share (the "Preferred Stock"), at a
cash exercise price of $75.00 per Unit (the "Exercise Price"),
subject to adjustment.
Initially, the Rights are not exercisable and are attached
to and trade with all outstanding shares of Common Stock
outstanding as of, and issued subsequent to, the Record Date.
The Rights will separate from the Common Stock and will become
exercisable upon the earliest of (i) the close of business on the
tenth calendar day following the first public announcement that a
person or group of affiliated or associated persons has acquired
beneficial ownership of 10% or more of the outstanding shares of
Common Stock (an "Acquiring Person") (the date of said
announcement being referred to as the "Stock Acquisition Date"),
or (ii) the close of business on the tenth business day (or such
later day as the Board of Directors may determine) following the
commencement of a tender offer or exchange offer that would
result upon its consummation in a person or group becoming the
beneficial owner of 10% or more of the outstanding shares of
Common Stock (the earliest of such dates being herein referred to
as the "Distribution Date").
Until the Distribution Date (or earlier redemption, exchange
or expiration of the Rights), (a) the Rights will be evidenced by
the Common Stock certificates and will be transferred with and
only with such Common Stock certificates, (b) new Common Stock
certificates issued after the Record Date will contain a notation
incorporating the Shareholder Rights Agreement by reference, and
(c) the surrender for transfer of any certificates for Common
Stock will also constitute the transfer of the Rights associated
with the Common Stock represented by such certificate.
The Rights are not exercisable until the Distribution Date
and will expire at the close of business on November 27, 2006,
unless previously redeemed or exchanged by the Company as
described below.
<PAGE>
As soon as practicable after the Distribution Date, Right
Certificates will be mailed to holders of record of Common Stock
as of the close of business on the Distribution Date and,
thereafter, the separate Right Certificates alone will represent
the Rights. Except as otherwise determined by the Board of
Directors, only shares of Common Stock issued prior to the
Distribution Date will be issued with Rights.
In the event that a Stock Acquisition Date occurs, proper
provision will be made so that each holder of a Right (other than
an Acquiring Person or associates or affiliates thereof, whose
Rights shall become null and void) will thereafter have the right
to receive upon exercise that number of Units of Preferred Stock
of the Company having a market value of two times the exercise
price of the Right (such right being referred to as the
"Subscription Right"). In the event that, at any time following
the Stock Acquisition Date, (i) the Company consolidates with, or
merges with and into, any other person, and the Company is not
the continuing or surviving corporation, (ii) any person
consolidates with the Company, or merges with and into the
Company and the Company is the continuing or surviving
corporation of such merger and, in connection with such merger,
all or part of the shares of Common Stock are changed into or
exchanged for stock or other securities of any other person or
cash or any other property, or (iii) 50% or more of the Company's
assets or earning power is sold, mortgaged or otherwise
transferred, each holder of a Right shall thereafter have the
right to receive, upon exercise, common stock of the acquiring
company having a market value equal to two times the exercise
price of the Right (such right being referred to as the "Merger
Right"). The holder of a Right will continue to have the Merger
Right whether or not such holder has exercised the Subscription
Right. Rights that are or were beneficially owned by an
Acquiring Person may (under certain circumstances specified in
the Rights Agreement) become null and void.
At any time after the Stock Acquisition Date occurs, the
Board of Directors may, at its option, exchange all or any part
of the then outstanding and exercisable Rights for shares of
Common Stock or Units of Preferred Stock at an exchange ratio of
one share of Common Stock or one Unit of Preferred Stock per
Right. Notwithstanding the foregoing, the Board of Directors
generally will not be empowered to effect such exchange at any
time after any person becomes the beneficial owner of 50% or more
of the Common Stock of the Company.
The Exercise Price payable, and the number of Units of
Preferred Stock or other securities or property issuable, upon
exercise of the Rights are subject to adjustment from time to
time to prevent dilution (i) in the event of a stock dividend on,
or a subdivision, combination or reclassification of, the
Preferred Stock, (ii) if holders of the Preferred Stock are
granted certain rights or warrants to subscribe for Preferred
Stock or convertible securities at less than the current market
price of the Preferred Stock, or (iii) upon the distribution to
holders of the Preferred Stock of evidences of indebtedness or
assets (excluding regular quarterly cash dividends) or of
subscription rights or warrants (other than those referred to
above).
<PAGE>
With certain exceptions, no adjustment in the Exercise Price
will be required until cumulative adjustments amount to at least
1% of the Exercise Price. The Company is not obligated to issue
fractional Units. If the Company elects not to issue fractional
Units, in lieu thereof an adjustment in cash will be made based
on the fair market value of the Preferred Stock on the last
trading date prior to the date of exercise. Any of the
provisions of the Rights Agreement may be amended by the Board of
Directors of the Company at any time prior to the Distribution
Date.
The Rights may be redeemed in whole, but not in part, at a
price of $0.01 per Right (payable in cash, Common Stock or other
consideration deemed appropriate by the Board of Directors) by
the Board of Directors only until the earliest of (i) the close
of business on the tenth calendar day after the Stock Acquisition
Date, or (ii) the expiration date of the Rights Agreement.
Immediately upon the action of the Board of Directors ordering
redemption of the Rights, the Rights will terminate and
thereafter the only right of the holders of Rights will be to
receive the redemption price.
The Rights Agreement may be amended by the Board of
Directors in its sole discretion until the Distribution Date.
After the Distribution Date, the Board of Directors may, subject
to certain limitations set forth in the Rights Agreement, amend
the Rights Agreement only to cure any ambiguity, defect or
inconsistency, to shorten or lengthen any time period, or to make
changes that do not adversely affect the interests of Rights
holders (excluding the interests of an Acquiring Person or
associates or affiliates thereof).
Until a Right is exercised, the holder will have no rights
as a stockholder of the Company (beyond those as an existing
stockholder), including the right to vote or to receive
dividends. While the distribution of the Rights will not be
taxable to stockholders or to the Company, stockholders may,
depending upon the circumstances, recognize taxable income in the
event that the Rights become exercisable for Units, other
securities of the Company, other consideration or for common
stock of an acquiring company.
The Rights Agreement between the Company and the Rights
Agent specifying the terms of the Rights, which includes as
Exhibit B the Form of Rights Certificate, is attached hereto as
Exhibit 4.1 and is incorporated herein by reference. The
foregoing description of the Rights does not purport to be
complete and is qualified in its entirety by reference to the
Rights Agreement which is incorporated herein by reference.
Item 2 - Exhibits
Exhibit 3.1 Articles Supplementary to the Articles of
Incorporation of Sovran Self Storage, Inc.,
classifying and designating the Series A Junior
Participating Cumulative Preferred Stock.
<PAGE>
Exhibit 4.1 Shareholder Rights Agreement, dated November 27,
1996, between Sovran Self Storage, Inc. and
American Stock Transfer and Trust Company, as
Rights Agent (including the form of Rights
Certificate as Exhibit B).
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this
registration statement to be signed on its behalf by the
undersigned, thereto duly authorized.
SOVRAN SELF STORAGE, INC.
Date: November 27, 1996 By: /s/ David L. Rogers
David L. Rogers
Chief Financial Officer and
Secretary
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
3.1 Articles Supplementary to the Articles of Incorporation
of Sovran Self Storage, Inc., classifying and
designating the Series A Junior Participating
Cumulative Preferred Stock.
4.1 Shareholder Rights Agreement, dated November 27, 1996,
between Sovran Self Storage, Inc. and American Stock
Transfer and Trust Company, as Rights Agent (including
the form of Rights Certificate as Exhibit B).
<PAGE>
Exhibit 3.1
ARTICLES SUPPLEMENTARY
CLASSIFYING AND DESIGNATING A SERIES OF PREFERRED STOCK
AS
SERIES A JUNIOR PARTICIPATING CUMULATIVE PREFERRED STOCK
OF
SOVRAN SELF STORAGE, INC.
Pursuant to Section 2-201 of the General Corporation Law
of the State of Maryland
We, Kenneth F. Myszka and David L. Rogers, being the
President and the Secretary, respectively, of SOVRAN SELF
STORAGE, INC., a corporation organized and existing under the
General Corporation Law of the State of Maryland (the
"Corporation"), in accordance with the provisions of
Section 1-301 thereof, DO HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board of
Directors by the Articles of Incorporation of the Corporation, on
November 6, 1996, the Board of Directors adopted the following
resolution creating a series of 250,000 shares of Preferred Stock
designated as "Series A Junior Participating Cumulative Preferred
Stock":
"RESOLVED, that pursuant to the
authority vested in the Board of Directors of
the Corporation in accordance with the
provisions of its Articles of Incorporation,
a series of Preferred Stock, par value $.01
per share, of the Corporation be, and it
hereby is, created, with such voting powers,
preferences and relative, participating,
optional or other special rights, and such
qualifications, limitations or restrictions
thereof, as follows:
Section 1. Designation and Amount. There shall be a series
of Preferred Stock of the Corporation which shall be designated
as "Series A Junior Participating Cumulative Preferred Stock,"
par value $.01 per share (hereinafter called "Series A Preferred
Stock"), and the number of shares constituting such series shall
be 250,000. Such number of shares may be increased or decreased
by resolution of the Board of Directors and by the filing of
articles of amendment pursuant to the provisions of the General
Corporation Law of the State of Maryland stating that such
increase or reduction has been so authorized; provided, however,
that no decrease shall reduce the number of shares of Series A
Preferred Stock to a number less than that of the shares then
outstanding plus the number of shares of Series A Preferred Stock
<PAGE>
issuable upon exercise of outstanding rights, options or warrants
or upon conversion of outstanding securities issued by the
Corporation.
Section 2. Dividends and Distributions.
(A) (i) Subject to the rights of the holders of any shares
of any series of preferred stock (or any similar stock) ranking
prior and superior to the Series A Preferred Stock with respect
to dividends, the holders of Series A Preferred Stock, in
preference to the holders of common stock and of any other junior
stock, shall be entitled to receive, when, as and if declared by
the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the first day of
March, June, September and December in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"),
commencing on the first Quarterly Dividend Payment Date after the
first issuance of a share or fraction of a Series A Preferred
Share, in an amount per share (rounded to the nearest cent) equal
to the greater of (a) $1.00 or (b) subject to the provisions for
adjustment hereinafter set forth, 1,000 times the aggregate per
share amount of all cash dividends, and 1,000 times the aggregate
per share amount (payable in kind) of all non-cash dividends or
other distributions other than a dividend payable in shares of
common stock or a subdivision of the outstanding shares of common
stock (by reclassification or otherwise), declared on the shares
of common stock since the immediately preceding Quarterly
Dividend Payment Date, or, with respect to the first Quarterly
Dividend Payment Date, since the first issuance of any share or
fraction of a Series A Preferred Share. The multiple of cash and
non-cash dividends declared on the shares of common stock to
which holders of the Series A Preferred Stock are entitled, which
shall be 1,000 initially but which shall be adjusted from time to
time as hereinafter provided, is hereinafter referred to as the
"Dividend Multiple." In the event the Corporation shall at any
time after November 15, 1996 (the "Rights Declaration Date") (i)
declare or pay any dividend on the shares of common stock payable
in shares of common stock, or (ii) effect a subdivision or
combination or consolidation of the outstanding shares of common
stock (by reclassification or otherwise than by payment of a
dividend in shares of common stock) into a greater or lesser
number of shares of common stock, then in each such case the
Dividend Multiple thereafter applicable to the determination of
the amount of dividends which holders of Series A Preferred Stock
shall be entitled to receive shall be the Dividend Multiple
applicable immediately prior to such event multiplied by a
fraction, the numerator of which is the number of shares of
common stock outstanding immediately after such event and the
denominator of which is the number of shares of common stock that
were outstanding immediately prior to such event.
(ii) Notwithstanding anything else contained in this
paragraph (A), the Corporation shall, out of funds legally
available for that purpose, declare a dividend or distribution on
the Series A Preferred Stock as provided in this paragraph (A)
immediately after it declares a dividend or distribution on the
shares of common stock (other than a dividend payable in shares
of common stock); provided that, in the event no dividend or
<PAGE>
distribution shall have been declared on the shares of common
stock during the period between any Quarterly Dividend Payment
Date and the next subsequent Quarterly Dividend Payment Date, a
dividend of $1.00 per share on the Series A Preferred Stock shall
nevertheless be payable on such subsequent Quarterly Dividend
Payment Date.
(B) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such
Series A Preferred Stock, unless the date of issue of such shares
is prior to the record date for the first Quarterly Dividend
Payment Date, in which case dividends on such shares shall begin
to accrue from the date of issue of such shares, or unless the
date of issue is a Quarterly Dividend Payment Date or is a date
after the record date for the determination of holders of shares
of Series A Preferred Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment Date, in
either of which events such dividends shall begin to accrue and
be cumulative from such Quarterly Dividend Payment Date. Accrued
but unpaid dividends shall not bear interest. Dividends paid on
the shares of Series A Preferred Stock in an amount less than the
total amount of such dividends at the time accrued and payable on
such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of
Directors may fix in accordance with applicable law a record date
for the determination of holders of shares of Series A Preferred
Stock entitled to receive payment of a dividend or distribution
declared thereon, which record date shall be not more than such
number of days prior to the date fixed for the payment thereof as
may be allowed by applicable law.
Section 3. Voting Rights. In addition to any other voting
rights required by law, the holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth, each Series A Preferred Share shall entitle the holder
thereof to 1,000 votes on all matters submitted to a vote of the
shareholders of the Corporation. The number of votes which a
holder of a Series A Preferred Share is entitled to cast, which
shall initially be 1,000 but which may be adjusted from time to
time as hereinafter provided, is hereinafter referred to as the
"Vote Multiple." In the event the Corporation shall at any time
after the Rights Declaration Date (i) declare or pay any dividend
on shares of common stock payable in shares of common stock, or
(ii) effect a subdivision or combination or consolidation of the
outstanding shares of common stock (by reclassification or
otherwise than by payment of a dividend in shares of common
stock) into a greater or lesser number of shares of common stock,
then in each such case the Vote Multiple thereafter applicable to
the determination of the number of votes per share to which
holders of shares of Series A Preferred Stock shall be entitled
shall be the Vote Multiple immediately prior to such event
multiplied by a fraction, the numerator of which is the number of
shares of common stock outstanding immediately after such event
and the denominator of which is the number of shares of common
stock that were outstanding immediately prior to such event.
<PAGE>
(B) Except as otherwise provided herein or by law, the
holders of shares of Series A Preferred Stock and the holders of
shares of common stock and the holders of shares of any other
capital stock of this Corporation having general voting rights,
shall vote together as one class on all matters submitted to a
vote of shareholders of the Corporation.
(C) (i) Whenever, at any time or times, dividends
payable on any shares of Series A Preferred Stock shall be
in arrears in an amount equal to at least two full quarter
dividends (whether or not declared and whether or not
consecutive), the holders of record of the outstanding
shares of Series A Preferred Stock shall have the exclusive
right, voting separately as a single class, to elect two
directors of the Corporation at a special meeting of
shareholders of the Corporation or at the Corporation's next
annual meeting of shareholders, and at each subsequent
annual meeting of shareholders, as provided below. At
elections for such directors, each Series A Preferred Share
shall entitle the holder thereof to 1,000 votes in such
elections.
(ii) Upon the vesting of such right of the holders
of shares of Series A Preferred Stock, the maximum
authorized number of members of the Board of Directors shall
automatically be increased by two and the two vacancies so
created shall be filled by vote of the holders of the
outstanding shares of Series A Preferred Stock as
hereinafter set forth. A special meeting of the
shareholders of the Corporation then entitled to vote shall
be called by the Chairman of the Board of Directors or the
President or the Secretary of the Corporation, if requested
in writing by the holders of record of not less than 10% of
the shares of Series A Preferred Stock then outstanding. At
such special meeting, or, if no such special meeting shall
have been called, then at the next annual meeting of
shareholders of the Corporation, the holders of the shares
of Series A Preferred Stock shall elect, voting as above
provided, two directors of the Corporation to fill the
aforesaid vacancies created by the automatic increase in the
number of members of the Board of Directors. At any and all
such meetings for such election, the holders of a majority
of the outstanding shares of Series A Preferred Stock shall
be necessary to constitute a quorum for such election,
whether present in person or proxy, and such two directors
shall be elected by the vote of at least a majority of the
shares of Series A Preferred Stock held by such shareholders
present or represented at the meeting. Any director elected
by holders of shares of Series A Preferred Stock pursuant to
this Section may be removed at any annual or special
meeting, by vote of a majority of the shareholders voting as
a class who elected such director, with or without cause.
In case any vacancy shall occur among the directors elected
by the holders of shares of Series A Preferred Stock
pursuant to this Section, such vacancy may be filled by the
remaining director so elected, or his successor then in
office, and the director so elected to fill such vacancy
<PAGE>
shall serve until the next meeting of shareholders for the
election of directors. After the holders of shares of
Series A Preferred Stock shall have exercised their right to
elect directors in any default period and during the
continuance of such period, the number of directors shall
not be further increased or decreased except by vote of the
holders of shares of Series A Preferred Stock as herein
provided or pursuant to the rights of any equity securities
ranking senior to or pari passu with the Series A Preferred
Stock.
(iii) The right of the holders of shares of
Series A Preferred Stock, voting separately as a class, to
elect two members of the Board of Directors of the
Corporation as aforesaid shall continue until, and only
until, such time as all arrears in dividends (whether or not
declared) on the Series A Preferred Stock shall have been
paid or declared and set apart for payment, at which time
such right shall terminate, except as herein or by law
expressly provided subject to revesting in the event of each
and every subsequent default of the character
above-mentioned. Upon any termination of the right of the
holders of the Series A Preferred Stock as a class to vote
for directors as herein provided, the term of office of all
directors then in office elected by the holders of shares of
Series A Preferred Stock pursuant to this Section shall
terminate immediately. Whenever the term of office of the
directors elected by the holders of shares of Series A
Preferred Stock pursuant to this Section shall terminate and
the special voting powers vested in the holders of the
Series A Preferred Stock pursuant to this Section shall have
expired, the maximum number of members of this Board of
Directors of the Corporation shall be such number as may be
provided for in the By-laws of the Corporation, irrespective
of any increase made pursuant to the provisions of this
Section.
(D) Except as otherwise required by applicable law or as
set forth herein, holders of Series A Preferred Stock shall have
no special voting rights and their consent shall not be required
(except to the extent they are entitled to vote with holders of
shares of common stock as set forth herein) for taking any
corporate action.
Section 4. Certain Restrictions.
(A) Whenever dividends or distributions payable on the
Series A Preferred Stock as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A
Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise
acquire for consideration any shares of stock ranking
junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred
Stock;
<PAGE>
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a
parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Preferred
Stock, except dividends paid ratably on the Series A
Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to
the total amounts to which the holders of all such
shares are then entitled;
(iii) except as permitted in subsection 4(A)(iv) below,
redeem, purchase or otherwise acquire for consideration
shares of any stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding
up) with the Series A Preferred Stock, provided that
the Corporation may at any time redeem, purchase or
otherwise acquire shares of any such parity stock in
exchange for shares of any stock of the Corporation
ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A
Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of
any stock ranking on a parity (either as to dividends
or upon liquidation, dissolution or winding up) with
the Series A Preferred Stock, except in accordance with
a purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of
such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend
rates and other relative rights and preferences of the
respective series and classes, shall determine in good
faith will result in fair and equitable treatment among
the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration
any shares of stock of the Corporation unless the Corporation
could, under subsection (A) of this Section 4, purchase or
otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A
Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired and
cancelled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but
unissued shares of preferred stock and may be reissued as part of
a new series of preferred stock to be created by resolution or
resolutions of the Board of Directors, subject to the conditions
and restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. Upon
any liquidation (voluntary or otherwise), dissolution or winding
up of the Corporation, no distribution shall be made (x) to the
holders of shares of stock ranking junior (either as to dividends
or upon liquidation, dissolution or winding up) to the Series A
<PAGE>
Preferred Stock unless, prior thereto, the holders of shares of
Series A Preferred Stock shall have received an amount equal to
accrued and unpaid dividends and distributions thereon, whether
or not declared, to the date of such payment, plus an amount
equal to the greater of (1) $1,000.00 per share or (2) an
aggregate amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 1,000 times the
aggregate amount to be distributed per share to holders of shares
of common stock, or (y) to the holders of stock ranking on a
parity (either as to dividends or upon liquidation, dissolution
or winding up) with the Series A Preferred Stock, except
distributions made ratably on the Series A Preferred Stock and
all other such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. In the event the
Corporation shall at any time after the Rights Declaration Date
(i) declare or pay any dividend on shares of common stock payable
in shares of common stock, or (ii) effect a subdivision or
combination or consolidation of the outstanding shares of common
stock (by reclassification or otherwise than by payment of a
dividend in shares of common stock) into a greater or lesser
number of shares of common stock, then in each such case the
aggregate amount per share to which holders of Series A Preferred
Stock were entitled immediately prior to such event under clause
(x) of the preceding sentence shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number
of shares of common stock outstanding immediately after such
event and the denominator of which is the number of shares of
common stock that were outstanding immediately prior to such
event.
Neither the consolidation of nor merging of the Corporation
with or into any other corporation or corporations, nor the sale
or other transfer of all or substantially all of the assets of
the Corporation, shall be deemed to be a liquidation, dissolution
or winding up of the Corporation within the meaning of this
Section 6.
Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of common
stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case
the shares of Series A Preferred Stock shall at the same time be
similarly exchanged or changed in an amount per share (subject to
the provision for adjustment hereinafter set forth) equal to
1,000 times the aggregate amount of stock, securities, cash
and/or any other property (payable in kind), as the case may be,
into which or for which each common share is changed or
exchanged, plus accrued and unpaid dividends, if any, payable
with respect to the Series A Preferred Stock. In the event the
Corporation shall at any time after the Rights Declaration Date
(i) declare or pay any dividend on shares of common stock payable
in shares of common stock, or (ii) effect a subdivision or
combination or consolidation of the outstanding shares of common
stock (by reclassification or otherwise than by payment of a
dividend in shares of common stock) into a greater or lesser
<PAGE>
number of shares of common stock, then in each such case the
amount set forth in the preceding sentence with respect to the
exchange or change of Series A Preferred Stock shall be adjusted
by multiplying such amount by a fraction, the numerator of which
is the number of shares of common stock outstanding immediately
after such event and the denominator of which is the number of
shares of common stock that were outstanding immediately prior to
such event.
Section 8. Redemption. The shares of Series A Preferred
Stock shall not be redeemable; provided, however, that the
foregoing shall not limit the ability of the Corporation to
purchase or otherwise deal in such shares to the extent otherwise
permitted hereby and by law.
Section 9. Ranking. Unless otherwise provided in the
Articles of Incorporation or Articles Supplementary relating to a
subsequently-designated series of preferred stock of the
Corporation, the Series A Preferred Stock shall rank junior to
any other series of the Corporation's preferred stock
subsequently issued, as to the payment of dividends and the
distribution of assets on liquidation, dissolution or winding up
and shall rank senior to the common stock.
Section 10. Amendment. Neither these Articles
Supplementary nor the Articles of Incorporation of the
Corporation may be amended in any manner which would materially
alter or change the powers, preferences or special rights of the
Series A Preferred Stock so as to affect them adversely without
the affirmative vote of the holders of a majority or more of the
outstanding shares of Series A Preferred Stock, voting separately
as a class.
Section 11. Fractional Shares. Shares of Series A
Preferred Stock may be issued in whole shares or in any fraction
of a share that is one ten-thousandth (1/1,000th) of a share or
any integral multiple of such fraction, which shall entitle the
holder, in proportion to such holder's fractional shares, to
exercise voting rights, receive dividends, participate in
distributions and to have the benefit of all other rights of
holders of shares of Series A Preferred Stock. In lieu of
fractional shares, the Corporation may elect to make a cash
payment as provided in the Rights Agreement for fractions of a
share other than one ten-thousandth (1/1,000th) of a share or any
integral multiple thereof."
<PAGE>
IN WITNESS WHEREOF, these Articles Supplementary have been
executed on behalf of the Corporation by its President and
attested by its Secretary this 15th day of November, 1996.
SOVRAN SELF STORAGE, INC.
By:/s/ Kenneth F. Myszka
Kenneth F. Myszka
President
(SEAL)
ATTEST:
By:/s/ David L. Rogers
David L. Rogers
Secretary
<PAGE>
Exhibit 4.1
_____________________________________________________
SOVRAN SELF STORAGE, INC.
and
AMERICAN STOCK TRANSFER AND TRUST COMPANY
as Rights Agent
___________________________
Shareholder Rights Agreement
Dated as of November 27, 1996
_____________________________________________________
<PAGE>
TABLE OF CONTENTS
Section Page
1. Certain Definitions. . . . . . . . . . . . . . . . . . . . .1
2. Appointment of Rights Agent. . . . . . . . . . . . . . . . .6
3. Issue of Right Certificates. . . . . . . . . . . . . . . . .6
4. Form of Right Certificates . . . . . . . . . . . . . . . . .8
5. Countersignature and Registration. . . . . . . . . . . . . .9
6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated,
Destroyed, Lost or Stolen Right Certificates. . . . . . . 10
7. Exercise of Rights; Exercise Price; Expiration Date of
Rights. . . . . . . . . . . . . . . . . . . . . . . . . . 11
8. Cancellation and Destruction of Right Certificates . . . . 13
9. Reservation and Availability of Preferred Stock. . . . . . 13
10. Preferred Stock Record Date . . . . . . . . . . . . . . . 15
11. Adjustment of Exercise Price, Number and Kind of Shares or
Number of Rights. . . . . . . . . . . . . . . . . . . . . 15
12. Certificate of Adjusted Exercise Price or Number of Shares24
13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power . . . . . . . . . . . . . . . . . . . . . . 24
14. Fractional Rights and Fractional Shares . . . . . . . . . 27
15. Rights of Action. . . . . . . . . . . . . . . . . . . . . 28
16. Agreement of Right Holders. . . . . . . . . . . . . . . . 28
17. Right Certificate Holder Not Deemed a Shareholder . . . . 29
18. Concerning the Rights Agent . . . . . . . . . . . . . . . 30
19. Merger or Consolidation or Change of Name of Rights Agent 30
20. Duties of Rights Agent. . . . . . . . . . . . . . . . . . 31
21. Change of Rights Agent. . . . . . . . . . . . . . . . . . 33
22. Issuance of New Right Certificates. . . . . . . . . . . . 34
23. Redemption. . . . . . . . . . . . . . . . . . . . . . . . 34
24. Exchange. . . . . . . . . . . . . . . . . . . . . . . . . 35
25. Notice of Certain Events. . . . . . . . . . . . . . . . . 37
<PAGE>
26. Notices . . . . . . . . . . . . . . . . . . . . . . . . . 38
27. Supplements and Amendments. . . . . . . . . . . . . . . . 38
28. Successors. . . . . . . . . . . . . . . . . . . . . . . . 39
29. Determinations and Actions by the Board of Directors. . . 39
30. Benefits of this Agreement. . . . . . . . . . . . . . . . 40
31. Severability. . . . . . . . . . . . . . . . . . . . . . . 40
32. Governing Law . . . . . . . . . . . . . . . . . . . . . . 40
33. Counterparts. . . . . . . . . . . . . . . . . . . . . . . 40
34. Descriptive Headings. . . . . . . . . . . . . . . . . . . 40
Exhibit A -- Articles Supplementary to the Articles of
Incorporation classifying and designating
the Series A Junior Participating
Cumulative Preferred Stock
Exhibit B -- Form of Right Certificate
<PAGE>
SHAREHOLDER RIGHTS AGREEMENT
Agreement, dated as of November 27, 1996, between Sovran
Self Storage, Inc., a Maryland corporation (the "Company"), and
American Stock Transfer and Trust Company, a New York corporation
(the "Rights Agent").
W I T N E S S E T H
WHEREAS, the Board of Directors of the Company desires to
provide shareholders of the Company with the opportunity to
benefit from the long-term prospects and value of the Company and
to ensure that shareholders of the Company receive fair and equal
treatment in the event of any proposed takeover of the Company;
and
WHEREAS, effective on November 27, 1996, the Board of
Directors of the Company authorized and declared a dividend
distribution of one Right (as such term is hereinafter defined)
for each outstanding share of Common Stock, par value $0.01 per
share, of the Company (the "Common Stock") outstanding as of the
close of business on December 16, 1996 (the "Record Date"), and
contemplates the issuance of one Right for each share of Common
Stock of the Company issued (whether originally issued or sold
from the Company's treasury) between the Record Date and the
earlier of the Distribution Date or the Expiration Date (as such
terms are hereinafter defined), each Right initially representing
the right to purchase one one-thousandth of a share of Series A
Junior Participating Cumulative Preferred Stock of the Company
having the rights, powers and preferences set forth on Exhibit A
hereto, upon the terms and subject to the conditions hereinafter
set forth (the "Rights"); and
WHEREAS, the Company desires to appoint the Rights Agent to
act as rights agent hereunder, in accordance with the terms and
conditions hereof;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereby agree as
follows:
Section 1. Certain Definitions. For purposes of this
Agreement, the following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as
hereinafter defined) who or which, together with all Affiliates
(as such term is hereinafter defined) and Associates (as such
term is hereinafter defined) of such Person, shall be the
Beneficial Owner (as such term is hereinafter defined) of 10% or
more of the shares of Common Stock of the Company then
outstanding, but shall not include (i) the Company, (ii) any
Subsidiary (as such term is hereinafter defined) of the Company,
(iii) any employee benefit plan or compensation arrangement of
the Company or any Subsidiary of the Company or (iv) any Person
holding shares of Common Stock of the Company organized,
appointed or established by the Company or any Subsidiary of the
<PAGE>
Company for or pursuant to the terms of any such employee benefit
plan or compensation arrangement (the Persons described in
clauses (i) through (iv) above are referred to herein as "Exempt
Persons").
Notwithstanding the foregoing, no Person shall become an
"Acquiring Person" as the result of an acquisition by the Company
of Common Stock of the Company which, by reducing the number of
shares outstanding, increases the proportionate number of shares
beneficially owned by such Person to 10% or more of the shares of
Common Stock of the Company then outstanding; provided, however,
that if a Person shall become the Beneficial Owner of 10% or more
of the shares of Common Stock of the Company then outstanding by
reason of share purchases by the Company and shall, after such
share purchases by the Company, become the Beneficial Owner of
any additional shares (other than pursuant to a stock split,
stock dividend or similar transaction) of Common Stock of the
Company and immediately thereafter be the Beneficial Owner of 10%
or more of the shares of Common Stock of the Company then
outstanding, then such Person shall be deemed to be an "Acquiring
Person."
In addition, notwithstanding the foregoing, a Person shall
not be an "Acquiring Person" if the Board of Directors of the
Company determines that a Person who would otherwise be an
"Acquiring Person," as defined pursuant to the foregoing
provisions of this Section 1(a), has become such inadvertently,
and such Person divests as promptly as practicable a sufficient
number of shares of Common Stock of the Company so that such
Person would no longer be an "Acquiring Person," as defined
pursuant to the foregoing provisions of this Section 1(a).
(b) "Adjustment Shares" shall have the meaning set
forth in Section 11(a)(ii) hereof.
(c) "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the
General Rules and Regulations (the "Rules") under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), as in
effect on the date of this Agreement; provided, however, that no
Person who is a director or officer of the Company shall be
deemed an Affiliate or an Associate of any other director or
officer of the Company solely as a result of his or her position
as director or officer of the Company.
(d) A Person shall be deemed the "Beneficial Owner"
of, and shall be deemed to "beneficially own," any securities:
(i) which such Person or any of such Person's
Affiliates or Associates, directly or indirectly,
beneficially owns (as determined pursuant to Rule 13d-3 of
the Rules under the Exchange Act, as in effect on the date
of this Agreement);
(ii) which such Person or any of such Person's
Affiliates or Associates, directly or indirectly, has:
<PAGE>
(A) the right to acquire (whether such right
is exercisable immediately or only after the passage of
time or upon the satisfaction of any conditions or
both) pursuant to 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) or upon the exercise of
conversion rights, exchange rights, rights (other than
the Rights), warrants or options, or otherwise;
provided, however, that a Person shall not be deemed
the "Beneficial Owner" of, or to "beneficially own,"
(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; (2) securities issuable upon exercise of
these Rights at any time prior to the occurrence of a
Triggering Event; or (3) securities issuable upon
exercise of Rights from and after the occurrence of a
Triggering Event, which Rights were acquired by such
Person or any of such Person's Affiliates or Associates
prior to the Distribution Date or pursuant to Sections
3(a), 11(i) or 22 hereof; or
(B) the right to vote pursuant to any
agreement, arrangement or understanding (whether or not
in writing); provided, however, that a Person shall not
be deemed the "Beneficial Owner" of, or to
"beneficially own," any security under this clause (B)
if the agreement, arrangement or understanding to vote
such security (1) arises solely from a revocable proxy
given in response to a public proxy or consent
solicitation made pursuant to, and in accordance with,
the Rules of the Exchange Act and (2) is not also then
reportable by such person on Schedule 13D under the
Exchange Act (or any comparable or successor report);
or
(C) the right to dispose of pursuant to any
agreement, arrangement or understanding (whether or not
in writing) (other than customary arrangements with and
between underwriters and selling group members with
respect to a bona fide public offering of securities);
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 pursuant to a revocable
proxy as described in clause (B) of Section 1(d)(ii) hereof)
or disposing of any securities of the Company;
<PAGE>
provided, however, that (1) no Person engaged in business as an
underwriter of securities shall be deemed the Beneficial Owner of
any securities acquired through such Person's participation as an
underwriter in good faith in a firm commitment underwriting until
the expiration of 40 days after the date of such acquisition, and
(2) no Person who is a director or an officer of the Company
shall be deemed, as a result of his or her position as director
or officer of the Company, the Beneficial Owner of any securities
of the Company that are beneficially owned by any other director
or officer of the Company.
(e) "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in the
City of New York, New York are authorized or obligated by law or
executive order to close.
(f) "Close of Business" on any given date shall mean
5:00 P.M., New York, New York time, on such date; provided,
however, that if such date is not a Business Day it shall mean
5:00 P.M., New York, New York time, on the next succeeding
Business Day.
(g) "Common Stock" when used in reference to the
Company shall mean the common stock, par value $0.01 per share,
of the Company or any other shares of capital stock of the
Company into which such stock shall be reclassified or changed.
"Common Stock" when used with reference to any Person other than
the Company organized in corporate form shall mean (i) the
capital stock or other equity interest of such Person with the
greatest voting power, (ii) the equity securities or other equity
interest having power to control or direct the management of such
Person or (iii) if such Person is a Subsidiary of another Person,
the Person or Persons which ultimately control such first-
mentioned Person and which have issued any such outstanding
capital stock, equity securities or equity interest. "Common
Stock" when used with reference to any Person not organized in
corporate form shall mean units of beneficial interest which (x)
shall represent the right to participate generally in the profits
and losses of such Person (including without limitation any flow-
through tax benefits resulting from an ownership interest in such
Person) and (y) shall be entitled to exercise the greatest voting
power of such Person or, in the case of a limited partnership,
shall have the power to remove or otherwise replace the general
partner or partners.
(h) "Current Value" shall have the meaning set forth
in Section 11(a)(iii) hereof.
(i) "Distribution Date" shall have the meaning defined
in Section 3(a) hereof.
(j) "Exercise Price" shall have the meaning defined in
Section 4(a) hereof.
(k) "Expiration Date" and "Final Expiration Date"
shall have the meanings set forth in Section 7(a) hereof.
<PAGE>
(l) "Fair Market Value" of any securities or other
property shall be as determined in accordance with Section 11(d)
hereof.
(m) "Person" shall mean an individual, a corporation,
a partnership, an association, a joint stock company, a trust, a
business trust, a government or political subdivision, any
unincorporated organization, or any other association or entity,
and includes, without limitation, an unincorporated group of
persons who, by formal or informal agreement, have embarked on a
common purpose or act, as well as any syndicate or group deemed
to be a "person" under Section 14(d)(2) of the Exchange Act.
(n) "Preferred Stock" shall mean the Series A Junior
Participating Cumulative Preferred Stock, par value $0.01 per
share, of the Company having the rights and preferences set forth
in the form of Articles Supplementary attached hereto as
Exhibit A.
(o) "Preferred Stock Equivalents" shall have the
meaning set forth in Section 11(b) hereof.
(p) "Principal Party" shall have the meaning defined
in Section 13(b) hereof.
(q) "Redemption Price" shall have the meaning defined
in Section 23 hereof.
(r) "Section 11(a)(ii) Event" shall have the meaning
defined in Section 11(a)(ii) hereof.
(s) "Section 11(a)(ii) Trigger Date" shall have the
meaning set forth in Section 11(a)(iii) hereof.
(t) "Section 13 Event" shall mean any event described
in clauses (x), (y) or (z) of Section 13(a) hereof.
(u) "Spread" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(v) "Stock Acquisition Date" shall mean the date of
the first public announcement (which for purposes of this
definition shall include, without limitation, the issuance of a
press release or the filing of a publicly-available report or
other document with the Securities and Exchange Commission or any
other governmental agency) by the Company or an Acquiring Person
that an Acquiring Person has become such.
(w) "Subsidiary" shall mean, with reference to any
Person, any corporation or other entity of which securities or
other ownership interest having ordinary voting power sufficient,
in the absence of contingencies, to elect a majority of the board
of directors or other persons performing similar functions of
such corporation or other entity are at the time directly or
indirectly beneficially owned or otherwise controlled by such
Person and any Affiliate of such Person.
(x) "Substitution Period" shall have the meaning set
forth in Section 11(a)(iii) hereof.
<PAGE>
(y) "Triggering Event" shall mean any Section
11(a)(ii) Event or any Section 13 Event.
Section 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company and the
holders of the Rights (who, in accordance with Section 3 hereof,
shall prior to the Distribution Date (as hereinafter defined in
Section 3(a)) also be the holders of the Common Stock of the
Company) in accordance with the terms and conditions hereof, and
the Rights Agent hereby accepts such appointment. The Company
may from time to time appoint such Co-Rights Agents as it may
deem necessary or desirable. In the event the Company appoints
one or more Co-Rights Agents, the respective duties of the Rights
Agent and any Co-Rights Agents shall be as the Company shall
determine.
Section 3. Issue of Right Certificates.
(a) From the date hereof until the earlier of (i) the
Close of Business on the tenth calendar day after the Stock
Acquisition Date or (ii) the Close of Business on the tenth
Business Day (or such later calendar day, if any, as the Board of
Directors may determine in its sole discretion) after the date a
tender or exchange offer by any Person, other than an Exempt
Person, is first published or sent or given within the meaning of
Rule 14d-4(a) of the Exchange Act, or any successor rule, if,
upon consummation thereof, such Person would be the Beneficial
Owner of 10% or more of the shares of Common Stock of the Company
then outstanding (including any such date which is after the date
of this Agreement and prior to the issuance of the Rights) (the
earliest of such dates being herein referred to as the
"Distribution Date"), (x) the Rights will be evidenced (subject
to the provisions of Section 3(b) hereof) by the certificates for
the Common Stock of the Company registered in the names of the
holders of the Common Stock of the Company (which certificates
for Common Stock of the Company shall be deemed also to be
certificates for Rights) and not by separate certificates, and
(y) the Rights will be transferable only in connection with the
transfer of the underlying shares of Common Stock of the Company.
As soon as practicable after the Distribution Date, the Rights
Agent will, at the Company's expense send, by first-class,
insured, postage prepaid mail, to each record holder of the
Common Stock of the Company as of the Close of Business on the
Distribution Date, at the address of such holder shown on the
records of the Company, one or more certificates, in
substantially the form of Exhibit B hereto (the "Right
Certificates"), evidencing one Right for each share of Common
Stock of the Company so held, subject to adjustment as provided
herein. In the event that an adjustment in the number of Rights
per share of Common Stock of the Company has been made pursuant
to Section 11(o) hereof, the Company may make the necessary and
appropriate rounding adjustments (in accordance with Section
14(a) hereof) at the time of distribution of the Right
Certificates, so that Right Certificates representing only whole
numbers of Rights are distributed and cash is paid in lieu of any
fractional Rights. As of and after the Close of Business on the
Distribution Date, the Rights will be evidenced solely by such
Right Certificates.
<PAGE>
(b) With respect to certificates for the Common Stock
of the Company issued prior to the Close of Business on the
Record Date, the Rights will be evidenced by such certificates
for the Common Stock of the Company on or until the Distribution
Date (or the earlier redemption, expiration or termination of the
Rights), and the registered holders of the Common Stock of the
Company also shall be the registered holders of the associated
Rights. Until the Distribution Date (or the earlier redemption,
expiration or termination of the Rights), the transfer of any of
the certificates for the Common Stock of the Company outstanding
prior to the date of this Agreement shall also constitute the
transfer of the Rights associated with the Common Stock of the
Company represented by such certificate.
(c) As promptly as practicable following the Record
Date, the Company will send a copy of a summary of the rights to
each record holder of shares of Common Stock of the Company as of
the Close of Business on the Record Date, at the address of such
holder shown on the records of the Company.
(d) Certificates for the Common Stock of the Company
issued after the Record Date, but prior to the earlier of the
Distribution Date or the redemption, expiration or termination of
the Rights, shall be deemed also to be certificates for Rights,
and shall bear a legend, substantially in the form set forth
below:
This certificate also evidences and entitles
the holder hereof to certain Rights as set
forth in a Shareholder Rights Agreement
between Sovran Self Storage, Inc. and
American Stock Transfer and Trust Company, as
Rights Agent, dated as of November 15, 1996
(the "Rights Agreement"), the terms of which
are hereby incorporated herein by reference
and a copy of which is on file at the
principal offices of Sovran Self Storage,
Inc. and the stock transfer administration
office of the Rights Agent. Under certain
circumstances, as set forth in the Rights
Agreement, such Rights will be evidenced by
separate certificates and will no longer be
evidenced by this certificate. Sovran Self
Storage, Inc. may redeem the Rights at a
redemption price of $0.01 per Right, subject
to adjustment, under the terms of the Rights
Agreement. Sovran Self Storage, Inc. will
mail to the holder of this certificate a copy
of the Rights Agreement, as in effect on the
date of mailing, without charge promptly
after receipt of a written request therefor.
Under certain circumstances, Rights issued to
or held by Acquiring Persons or any
Affiliates or Associates thereof (as defined
in the Rights Agreement), and any subsequent
holder of such Rights, may become null and
void. The Rights shall not be exercisable,
and shall be void so long as held, by a
<PAGE>
holder in any jurisdiction where the
requisite qualification to the issuance to
such holder, or the exercise by such holder,
of the Rights in such jurisdiction shall not
have been obtained or be obtainable.
With respect to such certificates containing the foregoing
legend, the Rights associated with the Common Stock of the
Company represented by such certificates shall be evidenced by
such certificates alone until the Distribution Date (or the
earlier redemption, expiration or termination of the Rights), and
the transfer of any of such certificates shall also constitute
the transfer of the Rights associated with the Common Stock of
the Company represented by such certificates. In the event that
the Company purchases or acquires any shares of Common Stock of
the Company after the Record Date but prior to the Distribution
Date, any Rights associated with such Common Stock of the Company
shall be deemed canceled and retired so that the Company shall
not be entitled to exercise any Rights associated with the shares
of Common Stock of the Company which are no longer outstanding.
The failure to print the foregoing legend on any such certificate
representing Common Stock of the Company or any defect therein
shall not affect in any manner whatsoever the application or
interpretation of the provisions of Section 7(e) hereof.
Section 4. Form of Right Certificates.
(a) The Right Certificates (and the forms of election
to purchase shares and of assignment and certificate to be
printed on the reverse thereof) shall each be substantially in
the form of Exhibit B hereto and may have such marks of
identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate
and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any applicable
law, rule or regulation or with any rule or regulation of any
stock exchange on which the Rights may from time to time be
listed, or to conform to customary usage. The Rights
Certificates shall be in a machine printable format and in a form
reasonably satisfactory to the Rights Agent. Subject to the
provisions of Section 11 and Section 22 hereof, the Right
Certificates, whenever distributed, shall be dated as of the
Record Date, shall show the date of countersignature, and on
their face shall entitle the holders thereof to purchase such
number of one one-thousandths of a share of Preferred Stock as
shall be set forth therein at the price set forth therein (the
"Exercise Price"), but the number of such shares and the Exercise
Price shall be subject to adjustment as provided herein.
(b) Any Right Certificate issued pursuant to Section
3(a) or Section 22 hereof that represents Rights 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 Associate or Affiliate of an Acquiring Person) 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
<PAGE>
the Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person to holders of equity
interests in such Acquiring Person or to any Person with whom the
Acquiring Person has any continuing agreement, arrangement or
understanding (whether or not in writing) regarding the
transferred Rights, the shares of Common Stock of the Company
associated with such Rights or the Company or (B) a transfer
which the Board of Directors of the Company has determined is
part of a plan, arrangement or understanding which has as a
primary purpose or effect the avoidance of Section 7(e) hereof,
and any Right Certificate issued pursuant to Section 6,
Section 11 or Section 22 upon transfer, exchange, replacement or
adjustment of any other Right Certificate referred to in this
sentence, shall have deleted therefrom the second sentence of the
existing legend on such Right Certificate and in substitution
therefor shall contain the following legend:
The Rights represented by this Right
Certificate are or were beneficially owned by
a Person who was or became an Acquiring
Person or an Affiliate or an Associate of an
Acquiring Person (as such terms are defined
in the Rights Agreement). This Right
Certificate and the Rights represented hereby
may become null and void under certain
circumstances as specified in Section 7(e) of
the Rights Agreement.
The Company shall give notice to the Rights Agent promptly after
it becomes aware of the existence and identity of any Acquiring
Person or any Associate or Affiliate thereof. The Company shall
instruct the Rights Agent in writing of the Rights which should
be so legended. The failure to print the foregoing legend on any
such Right Certificate or any defect therein shall not affect in
any manner whatsoever the application or interpretation of the
provisions of Section 7(e) hereof.
Section 5. Countersignature and Registration.
(a) The Right Certificates shall be executed on behalf
of the Company by its Chairman of the Board of Directors, or its
President or any Vice President and by its Treasurer or any
Assistant Treasurer, or by its Secretary or any Assistant
Secretary, either manually or by facsimile signature, and shall
have affixed thereto the Company's seal or a facsimile thereof
which shall be attested to by the Secretary or any Assistant
Secretary of the Company, either manually or by facsimile
signature. The Right Certificates shall be manually
countersigned by an authorized signatory of the Rights Agent and
shall not be valid for any purpose unless so countersigned, and
such countersignature upon any Right Certificate shall be
conclusive evidence, and the only evidence, that such Right
Certificate has been duly countersigned as required hereunder.
In case any officer of the Company who shall have signed any of
the Right Certificates shall cease to be such officer of the
Company before countersignature by the Rights Agent and issuance
<PAGE>
and delivery by the Company, such Right Certificates,
nevertheless, may be countersigned by an authorized signatory of
the Rights Agent, and issued and delivered by the Company with
the same force and effect as though the person who signed such
Right Certificates had not ceased to be such officer of the
Company; and any Right Certificates may be signed on behalf of
the Company by any person who, at the actual date of the
execution of such Right Certificate, shall be a proper officer of
the Company to sign such Right Certificate, although at the date
of the execution of this Rights Agreement any such person was not
such an officer.
(b) Following the Distribution Date, the Rights Agent
will keep or cause to be kept, at one of its offices designated
as the appropriate place for surrender of Right Certificates upon
exercise or transfer, books for registration and transfer of the
Right Certificates issued hereunder. Such books shall show the
names and addresses of the respective holders of the Right
Certificates, the number of Rights evidenced on its face by each
of the Right Certificates and the date of each of the Right
Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of
Right Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates.
(a) Subject to the provisions of Section 4(b), Section
7(e) and Section 14 hereof, at any time after the Close of
Business on the Distribution Date, and at or prior to the Close
of Business on the Expiration Date, any Right Certificate or
Certificates may be transferred, split up, combined or exchanged
for another Right Certificate or Certificates, entitling the
registered holder to purchase a like number of one one-
thousandths of a share of Preferred Stock (or following a
Triggering Event, preferred stock, cash, property, debt
securities, Common Stock of the Company or any combination
thereof) as the Right Certificate or Certificates surrendered
then entitled such holder to purchase and at the same Exercise
Price. Any registered holder desiring to transfer, split up,
combine or exchange any Right Certificate shall make such request
in writing delivered to the Rights Agent, and shall surrender the
Right Certificate or Certificates to be transferred, split up,
combined or exchanged, with the form of assignment and
certificate duly executed, at the office or offices of the Rights
Agent designated for such purpose. Neither the Rights Agent nor
the Company shall be obligated to take any action whatsoever with
respect to the transfer of any such surrendered Right Certificate
until the registered holder shall have completed and signed the
certificate contained in the form of assignment on the reverse
side of such Right Certificate and shall have provided such
additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) or Affiliates or Associates thereof as
the Company shall reasonably request. Thereupon the Rights Agent
shall, subject to Section 4(b), Section 7(e) and Section 14
hereof, countersign and deliver to the Person entitled thereto a
Right Certificate or Certificates, as the case may be, as so
requested. The Company may require payment by the registered
<PAGE>
holder of a Right Certificate, of a sum sufficient to cover any
tax or governmental charge that may be imposed in connection with
any transfer, split up, combination or exchange of Right
Certificates.
(b) Upon receipt by the Company and the Rights Agent
of evidence reasonably satisfactory to them of the loss, theft,
destruction or mutilation of a Right Certificate, and, in case of
loss, theft or destruction, of indemnity or security satisfactory
to them, and reimbursement to the Company and the Rights Agent of
all reasonable expenses incidental thereto, and upon surrender to
the Rights Agent and cancellation of the Right Certificate, if
mutilated, the Company will execute and deliver a new Right
Certificate of like tenor to the Rights Agent for
countersignature and delivery to the registered owner in lieu of
the Right Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Exercise Price; Expiration
Date of Rights.
(a) Subject to Section 7(e) hereof, the registered
holder of any Right Certificate may exercise the Rights evidenced
thereby (except as otherwise provided herein) in whole or in part
at any time after the Distribution Date upon surrender of the
Right Certificate, with the form of election to purchase and the
certificate on the reverse side thereof duly executed, to the
Rights Agent at the office or offices of the Rights Agent
designated for such purpose, together with payment of the
aggregate Exercise Price for the total number of one one-
thousandths of a share of Preferred Stock (or other securities,
cash or other assets, as the case may be) as to which such
surrendered Rights are then exercised, at or prior to the earlier
of (i) the Close of Business on November 15, 2006 (the "Final
Expiration Date"), (ii) the time at which the Rights are redeemed
as provided in Section 23 hereof or (iii) the time at which such
Rights are exchanged as provided in Section 24 hereof (the
earlier of (i), (ii) or (iii) being herein referred to as the
"Expiration Date"). Except as set forth in Section 7(e) hereof
and notwithstanding any other provision of this Agreement, any
Person who prior to the Distribution Date becomes a record holder
of shares of Common Stock of the Company may exercise all of the
rights of a registered holder of a Right Certificate with respect
to the Rights associated with such shares of Common Stock of the
Company in accordance with the provisions of this Agreement, as
of the date such Person becomes a record holder of shares of
Common Stock of the Company.
(b) The Exercise Price for each one one-thousandth of
a share of Preferred Stock pursuant to the exercise of a Right
shall initially be $75.00, shall be subject to adjustment from
time to time as provided in Section 11 and Section 13 hereof and
shall be payable in lawful money of the United States of America
in accordance with Section 7(c) below.
(c) As promptly as practicable following the
Distribution Date, the Company shall deposit with a corporation,
trust, bank or similar institution in good standing organized
<PAGE>
under the laws of the United States or any State of the United
States, which is authorized under such laws to exercise corporate
trust or stock transfer powers and is subject to supervision or
examination by a federal or state authority (such institution is
hereinafter referred to as the "Depositary Agent"), certificates
representing the shares of Preferred Stock that may be acquired
upon exercise of the Rights and the Company shall cause such
Depositary Agent to enter into an agreement pursuant to which the
Depositary Agent shall issue receipts representing interests in
the shares of Preferred Stock so deposited. Upon receipt of a
Right Certificate representing exercisable Rights, with the form
of election to purchase and the certificate on the reverse side
thereof duly executed, accompanied by payment of the Exercise
Price for the shares to be purchased and an amount equal to any
applicable transfer tax (as determined by the Rights Agent) in
cash, or by certified check or bank draft payable to the order of
the Company, the Rights Agent shall, subject to Section 20(k)
hereof, thereupon promptly (i) requisition from the Depositary
Agent (or make available, if the Rights Agent is the Depository
Agent) depository receipts or certificates for the number of one
one-thousandths of a share of Preferred Stock to be purchased and
the Company hereby irrevocably authorizes the Depositary Agent to
comply with all such requests, (ii) requisition from the Company
the amount of cash, if any, to be paid in lieu of issuance of
fractional shares in accordance with Section 14 hereof,
(iii) promptly after receipt of such certificates or depositary
receipts, cause the same to be delivered to or upon the order of
the registered holder of such Right Certificate, registered in
such name or names as may be designated by such holder and (iv)
after receipt promptly deliver such cash to or upon the order of
the registered holder of such Right Certificate. In the event
that the Company is obligated to issue other securities
(including Common Stock) of the Company, pay cash or distribute
other property pursuant to Section 11(a) hereof, the Company will
make all arrangements necessary so that such other securities,
cash or other property are available for distribution by the
Rights Agent, if and when appropriate. The payment of the
Exercise Price may be made in cash or by certified or bank check
payable to the order of the Company, or by wire transfer of
immediately available funds to the account of the Company
(provided that notice of such wire transfer shall be given by the
holder of the related Right to the Rights Agent).
(d) In case the registered holder of any Right
Certificate shall exercise less than all the Rights evidenced
thereby, a new Right Certificate evidencing Rights equivalent to
the Rights remaining unexercised shall be issued by the Rights
Agent and delivered to the registered holder of such Right
Certificate or to his duly authorized assigns, subject to the
provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of a Section
11(a)(ii) Event or Section 13 Event, any 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 Associate or Affiliate of an Acquiring Person) who becomes
<PAGE>
a transferee after the Acquiring Person becomes such or (iii) a
transferee of an Acquiring Person (or of any Associate or
Affiliate of an Acquiring Person) who becomes a transferee prior
to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether
or not for consideration) from the Acquiring Person to holders of
equity interests in such Acquiring Person or to any Person with
whom the Acquiring Person has any continuing agreement,
arrangement or understanding regarding the transferred Rights,
the shares of Common Stock of the Company associated with such
Rights or the Company, or (B) a transfer which the Board of
Directors of the Company has determined is part of a plan,
arrangement or understanding which has as a primary purpose or
effect the avoidance of this Section 7(e), shall be null and void
without any further action and no holder of such Rights shall
have any rights whatsoever with respect to such Rights, whether
under any provision of this Agreement or otherwise. The Company
shall use all reasonable efforts to ensure that the provisions of
this Section 7(e) and Section 4(b) hereof are complied with, but
shall have no liability to any holder of Right Certificates or
other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or any
Affiliates or Associates of an Acquiring Person or any transferee
of any of them hereunder.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be
obligated to undertake any action with respect to a registered
holder of Rights upon the occurrence of any purported exercise as
set forth in this Section 7 unless such registered holder shall
have (i) completed and signed the certificate contained in the
form of election to purchase set forth on the reverse side of the
Right Certificate surrendered for such exercise, and
(ii) provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or
Associates thereof as the Company shall reasonably request.
Section 8. Cancellation and Destruction of Right
Certificates. All Right Certificates surrendered for the purpose
of exercise, transfer, split up, combination or exchange shall,
if surrendered to the Company or any of its agents, be delivered
to the Rights Agent for cancellation or in canceled form, or, if
surrendered to the Rights Agent, shall be canceled by it, and no
Right Certificates shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Agreement.
The Company shall deliver to the Rights Agent for cancellation
and retirement, and the Rights Agent shall so cancel and retire,
any other Right Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall
deliver all canceled Right Certificates to the Company.
Section 9. Reservation and Availability of Preferred Stock.
(a) The Company covenants and agrees that it will
cause to be reserved and kept available out of its authorized and
unissued shares of Preferred Stock or any authorized and issued
shares of Preferred Stock held in its treasury, the number of
<PAGE>
shares of Preferred Stock that will be sufficient to permit the
exercise in full of all outstanding and exercisable Rights. Upon
the occurrence of any events resulting in an increase in the
aggregate number of shares of Preferred Stock issuable upon
exercise of all outstanding Rights in excess of the number then
reserved, the Company shall make appropriate increases in the
number of shares so reserved.
(b) The Company shall use its best efforts to cause,
from and after such time as the Rights become exercisable, all
shares of Preferred Stock issued or reserved for issuance to be
listed, upon official notice of issuance, upon the principal
national securities exchange, if any, upon which the Common Stock
of the Company is listed or, if the principal market for the
Common Stock of the Company is not on any national securities
exchange, to be eligible for quotation on the National
Association of Securities Dealers Automated Quotation System
("NASDAQ") or any successor thereto or other comparable quotation
system.
(c) The Company shall use its best efforts to
(i) file, as soon as practicable following the earliest date
after the occurrence of a Section 11(a)(ii) Event on which the
consideration to be delivered by the Company upon exercise of the
Rights has been determined in accordance with Section 11(a)(iii)
hereof, or as soon as required by law following the Distribution
Date, as the case may be, a registration statement under the
Securities Act of 1933, as amended (the "Securities Act"), with
respect to the securities purchasable upon exercise of the Rights
on an appropriate form, (ii) cause such registration statement to
become effective as soon as practicable after such filing and
(iii) cause such registration statement to remain effective (with
a prospectus that at all times meets the requirements of the
Securities Act) until the earlier of (A) the date as of which the
Rights are no longer exercisable for such securities or (B) the
Expiration Date. The Company will also take such action as may
be appropriate under, and which will ensure compliance with, the
securities or "blue sky" laws of the various states in connection
with the exercisability of the Rights. The Company may
temporarily suspend, for a period of time not to exceed ninety
(90) days after the date determined in accordance with the
provisions of the first sentence of this Section 9(c), the
exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective. Upon
such suspension, the Company shall issue a public announcement
stating that the exercisability of the Rights has been
temporarily suspended, as well as a public announcement at such
time as the suspension is no longer in effect, in each case with
prompt written notice to the Rights Agent. Notwithstanding any
such provision of this Agreement to the contrary, the Rights
shall not be exercisable in any jurisdiction unless the requisite
qualification in such jurisdiction shall have been obtained.
(d) The Company covenants and agrees that it will take
all such action as may be necessary to ensure that all shares of
Preferred Stock delivered upon the exercise of the Rights shall,
at the time of delivery of the certificates or depositary
<PAGE>
receipts for such shares (subject to payment of the Exercise
Price), be duly and validly authorized and issued and fully paid
and nonassessable.
(e) The Company further covenants and agrees that it
will pay when due and payable any and all federal and state
transfer taxes and charges which may be payable in respect of the
issuance or delivery of the Right Certificates or of any
certificates for shares of Preferred Stock upon the exercise of
Rights. The Company shall not, however, be required to pay any
transfer tax which may be payable in respect of any transfer or
delivery of Right Certificates to a person other than, or in
respect of the issuance or delivery of securities in a name other
than that of, the registered holder of the Right Certificates
evidencing Rights surrendered for exercise or to issue or deliver
any certificates for securities in a name other than that of the
registered holder upon the exercise of any Rights until such tax
shall have been paid (any such tax being payable by the holder of
such Right Certificate at the time of surrender) or until it has
been established to the Company's satisfaction that no such tax
is due.
Section 10. Preferred Stock Record Date. Each Person in
whose name any certificate for Preferred Stock is issued upon the
exercise of Rights shall for all purposes be deemed to have
become the holder of record of the shares of Preferred Stock
represented thereby on, and such certificate shall be dated, the
date upon which the Right Certificate evidencing such Rights was
duly surrendered and payment of the Exercise Price (and any
applicable transfer taxes) was made; provided, however, that if
the date of such surrender and payment is a date upon which the
Preferred Stock transfer books of the Company are closed, such
person shall be deemed to have become the record holder of such
shares on, and such certificate shall be dated, the next
succeeding Business Day on which the Preferred Stock transfer
books of the Company are open; and further provided, however,
that if delivery of shares of Preferred Stock is delayed pursuant
to Section 9(c), such Person shall be deemed to have become the
record holder of such shares of Preferred Stock only when such
shares first become deliverable. Prior to the exercise of the
Right evidenced thereby, the holder of a Right Certificate shall
not be entitled to any rights of a shareholder of the Company
with respect to shares for which the Rights shall be exercisable,
including, without limitation, the right to vote, to receive
dividends or other distributions or to exercise any preemptive
rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
Section 11. Adjustment of Exercise Price, Number and Kind
of Shares or Number of Rights. The Exercise Price, the number
and kind of shares covered by each Right and the number of Rights
outstanding are subject to adjustment from time to time as
provided in this Section 11.
<PAGE>
(a) (i) In the event the Company shall at any time
after the date of this Agreement (A) declare a dividend
on the Preferred Stock payable in shares of Preferred
Stock, (B) subdivide the outstanding Preferred Stock,
(C) combine the outstanding Preferred Stock into a
smaller number of shares or (D) issue any shares of its
capital stock in a reclassification of the Preferred
Stock (including any such reclassification in
connection with a consolidation or merger in which the
Company is the continuing or surviving corporation),
except as otherwise provided in this Section 11(a) and
Section 7(e) hereof, the Exercise Price in effect at
the time of the record date for such dividend or of the
effective date of such subdivision, combination or
reclassification, and the number and kind of shares of
capital stock issuable on such date, shall be
proportionately adjusted so that the holder of any
Right exercised after such time shall be entitled to
receive the aggregate number and kind of shares of
capital stock which, if such Right had been exercised
immediately prior to such date and at a time when the
Preferred Stock transfer books of the Company were
open, such holder would have owned upon such exercise
and been entitled to receive by virtue of such
dividend, subdivision, combination or reclassification;
provided, however, that in no event shall the
consideration to be paid upon the exercise of a Right
be less than the aggregate par value of the shares of
capital stock of the Company issuable upon exercise of
a Right. If an event occurs which would require an
adjustment under both Section 11(a)(i) and Section
11(a)(ii) hereof, the adjustment provided for in this
Section 11(a)(i) shall be in addition to, and shall be
made prior to, any adjustment required pursuant to
Section 11(a)(ii) hereof.
(ii) Subject to the provisions of Section 24
hereof, in the event any Person, alone or together with
its Affiliates and Associates, shall become an
Acquiring Person (a "Section 11(a)(ii) Event"), then
promptly following any such occurrence, proper
provision shall be made so that each holder of a Right,
except as provided in Section 7(e) hereof, shall
thereafter have a right to receive, upon exercise
thereof at the then current Exercise Price in
accordance with the terms of this Agreement, such
number of shares of Preferred Stock of the Company as
shall equal the result obtained by (x) multiplying the
then current Exercise Price by the then number of one
one-thousandths of a share of Preferred Stock for which
a Right was exercisable immediately prior to the first
occurrence of a Section 11(a)(ii) Event, whether or not
such Right was then exercisable, and dividing that
product by (y) 50% of the Fair Market Value (as
hereinafter defined) per one one-thousandth of a share
of the Preferred Stock (determined pursuant to Section
11(d)) on the date of the occurrence of a Section
11(a)(ii) Event (such number of shares being referred
to as the "Adjustment Shares").
<PAGE>
(iii) In lieu of issuing any shares of
Preferred Stock in accordance with Section 11(a)(ii)
hereof, the Company, acting by resolution of the Board
of Directors, may, and in the event that the number of
shares of Preferred Stock which are authorized by the
Company's Certificate of Incorporation (or other
instrument governing its corporate affairs) but not
outstanding or reserved for issuance for purposes other
than upon exercise of the Rights is not sufficient to
permit the exercise in full of the Rights in accordance
with the foregoing subparagraph (ii) of this Section
11(a), the Company, acting by resolution of the Board
of Directors, shall: (A) determine the excess of (X)
the value of the Adjustment Shares issuable upon the
exercise of a Right (the "Current Value") over (Y) the
Exercise Price attributable to each Right (such excess
being referred to as the "Spread") and (B) with respect
to all or a portion of each Right (subject to Section
7(e) hereof), make adequate provision to substitute for
the Adjustment Shares, upon payment of the applicable
Exercise Price, (1) cash, (2) a reduction in the
Exercise Price, (3) Preferred Stock Equivalents which
the Board of Directors has deemed to have the same
value as shares of Common Stock of the Company, (4)
debt securities of the Company, (5) other assets of the
Company or (6) any combination of the foregoing which,
when added to any shares of Preferred Stock issued upon
such exercise, has an aggregate value equal to the
Current Value, where such aggregate value has been
determined by the Board of Directors based upon the
advice of a nationally recognized investment banking
firm selected by the Board of Directors; provided,
however, that if the Company shall not have made
adequate provision to deliver value pursuant to clause
(B) above within 30 days following the later of (x) the
first occurrence of a Section 11(a)(ii) Event and (y)
the date on which the Company's right of redemption
pursuant to Section 23(a) expires (the later of (x) and
(y) being referred to herein as the "Section 11(a)(ii)
Trigger Date"), then the Company shall be obligated to
deliver, upon the surrender for exercise of a Right and
without requiring payment of the Exercise Price, shares
of Preferred Stock (to the extent available) and then,
if necessary, cash, which shares and/or cash have an
aggregate value equal to the Spread. If the Board of
Directors shall determine in good faith that it is
likely that sufficient additional shares of Preferred
Stock could be authorized for issuance upon exercise in
full of the Rights, the 30-day period set forth above
may be extended to the extent necessary, but not more
than 90 days after the Section 11(a)(ii) Trigger Date,
in order that the Company may seek stockholder approval
for the authorization of such additional shares (such
period, as it may be extended, being referred to herein
as 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
<PAGE>
Section 11(a)(iii), the Company (x) shall provide,
subject to Section 7(e) hereof, that such action shall
apply uniformly to all outstanding Rights and (y) may
suspend the exercisability of the Rights until the
expiration of the Substitution Period in order to seek
any authorization of additional shares and/or to decide
the appropriate form of distribution to be made
pursuant to such first sentence and to determine the
value thereof. In the event of any such suspension,
the Company shall issue a public announcement stating
that the exercisability of the Rights has been
temporarily suspended and a public announcement at such
time as the suspension is no longer in effect. For
purposes of this Section 11(a)(iii), the value of the
Preferred Stock shall be the Fair Market Value (as
determined pursuant to Section 11(d) hereof) per share
of the Preferred Stock on the Section 11(a)(ii) Trigger
Date and the value of any Preferred Stock Equivalent
shall be deemed to have the same value as the Preferred
Stock on such date.
(b) If the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of
Preferred Stock entitling them (for a period expiring within 45
calendar days after such record date) to subscribe for or
purchase Preferred Stock (or securities having the same or more
favorable rights, privileges and preferences as the shares of
Preferred Stock ("Preferred Stock Equivalents")) or securities
convertible into Preferred Stock or Preferred Stock Equivalents
at a price per share of Preferred Stock or per share of Preferred
Stock Equivalents (or having a conversion price per share, if a
security convertible into Preferred Stock or Preferred Stock
Equivalents) less than the Fair Market Value (as determined
pursuant to Section 11(d) hereof) per share of Preferred Stock on
such record date, 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 shares of Preferred
Stock outstanding on such record date, plus the number of shares
of Preferred Stock which the aggregate offering price of the
total number of shares of Preferred Stock and/or Preferred Stock
Equivalents to be offered (and the aggregate initial conversion
price of the convertible securities so to be offered) would
purchase at such Fair Market Value and the denominator of which
shall be the number of shares of Preferred Stock outstanding on
such record date, plus the number of additional shares of
Preferred Stock and Preferred Stock Equivalents to be offered for
subscription or purchase (or into which the convertible
securities so to be offered are initially convertible); provided,
however, that in no event shall the consideration to be paid upon
the exercise of a Right be less than the aggregate par value of
the shares of capital stock of the Company issuable upon exercise
of a 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 the Fair Market
Value thereof determined in accordance with Section 11(d) hereof.
Shares of Preferred Stock owned by or held for the account of the
<PAGE>
Company shall not be deemed outstanding for the purpose of any
such computation. Such adjustments shall be made successively
whenever such a record date is fixed; and in the event that such
rights 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) If the Company shall fix a record date for the
making of a distribution to all holders of Preferred Stock
(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, cash (other
than a regular periodic cash dividend out of the earnings or
retained earnings of the Company), assets (other than a dividend
payable in Preferred Stock, but including any dividend payable in
stock other than Preferred Stock) or convertible securities,
subscription rights or warrants (excluding those referred to in
Section 11(b)), 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 Fair Market Value (as
determined pursuant to Section 11(d) hereof) per one one-
thousandth of a share of Preferred Stock on such record date,
less the Fair Market Value (as determined pursuant to
Section 11(d) hereof) of the portion of the cash, assets or
evidences of indebtedness so to be distributed or of such
convertible securities, subscription rights or warrants
applicable to one one-thousandth of a share of Preferred Stock
and the denominator of which shall be the Fair Market Value (as
determined pursuant to Section 11(d) hereof) per one one-
thousandth of a share of Preferred Stock; provided, however, that
in no event shall the consideration to be paid upon the exercise
of a Right be less than the aggregate par value of the shares of
capital stock of the Company issuable upon exercise of a 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 again be adjusted to be the
Exercise Price which would be in effect if such record date had
not been fixed.
(d) For the purpose of this Agreement, the "Fair
Market Value" of any share of Preferred Stock, Common Stock or
any other stock or any Right or other security or any other
property shall be determined as provided in this Section 11(d).
(i) In the case of a publicly-traded stock or
other security, the Fair Market Value on any date shall
be deemed to be the average of the daily closing prices
per share of such stock or per unit of such other
security for the 30 consecutive Trading Days (as such
term is hereinafter defined) immediately prior to such
date; provided, however, that in the event that the
Fair Market Value per share of any share of stock is
determined during a period following the announcement
by the issuer of such stock of (x) a dividend or
distribution on such stock payable in shares of such
stock or securities convertible into shares of such
<PAGE>
stock or (y) any subdivision, combination or
reclassification of such stock, and prior to the
expiration of the 30 Trading Day period after the ex-
dividend date for such dividend or distribution, or the
record date for such subdivision, combination or
reclassification, then, and in each such case, the Fair
Market Value shall be properly adjusted to take into
account ex-dividend trading. 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 securities are not
listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities
listed on the principal national securities exchange on
which such security is listed or admitted to trading;
or, if not listed or admitted to trading on any
national securities exchange, the last quoted price
(or, if not so quoted, the average of the last quoted
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 no bids for such
security are 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 such security selected by the Board of
Directors of the Company. If on any such date no
market maker is making a market in such security, the
Fair Market Value of such security on such date shall
be determined reasonably and with utmost good faith to
the holders of the Rights by the Board of Directors of
the Company, provided, however, that if at the time of
such determination there is an Acquiring Person, the
Fair Market Value of such security on such date shall
be determined by a nationally recognized investment
banking firm selected by the Board of Directors, which
determination shall be described in a statement filed
with the Rights Agent and shall be binding on the
Rights Agent and the holders of the Rights. The term
"Trading Day" shall mean a day on which the principal
national securities exchange on which such security is
listed or admitted to trading is open for the
transaction of business or, if such security is not
listed or admitted to trading on any national
securities exchange, a Business Day.
(ii) If a security is not publicly held or not so
listed or traded, "Fair Market Value" shall mean the
fair value per share of stock or per other unit of such
security, determined reasonably and with utmost good
faith to the holders of the Rights by the Board of
Directors of the Company, provided, however, that if at
the time of such determination there is an Acquiring
<PAGE>
Person, the Fair Market Value of such security on such
date shall be determined by a nationally recognized
investment banking firm selected by the Board of
Directors, which determination shall be described in a
statement filed with the Rights Agent and shall be
binding on the Rights Agent and the holders of the
Rights; provided, however, that for the purposes of
making any adjustment provided for by Section 11(a)(ii)
hereof, the Fair Market Value of a share of Preferred
Stock shall not be less than the product of the then
Fair Market Value of a share of Common Stock multiplied
by the higher of the then Dividend Multiple or Vote
Multiple (as both of such terms are defined in the
Articles Supplementary attached as Exhibit A hereto)
applicable to the Preferred Stock and shall not exceed
105% of the product of the then Fair Market Value of a
share of Common Stock multiplied by the higher of the
then Dividend Multiple or Vote Multiple applicable to
the Preferred Stock.
(iii) In the case of property other than
securities, the Fair Market Value thereof shall be
determined reasonably and with utmost good faith to the
holders of Rights by the Board of Directors of the
Company, provided, however, that if at the time of such
determination there is an Acquiring Person, the Fair
Market Value of such property on such date shall be
determined by a nationally recognized investment
banking firm selected by the Board of Directors, which
determination shall be described in a statement filed
with the Rights Agent and shall be binding upon the
Rights Agent and the holders of the Rights.
(e) 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 11(e) are not required to be made
shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made
to the nearest cent or to the nearest hundred-thousandth of a
share of Common Stock of the Company or ten-millionth of a share
of Preferred Stock, as the case may be, or to such other figure
as the Board of Directors may deem appropriate. Notwithstanding
the first sentence of this Section 11(e), any adjustment required
by this Section 11 shall be made no later than the earlier of (i)
three (3) years from the date of the transaction which mandates
such adjustment or (ii) the Expiration Date.
(f) If as a result of any provision of Section 11(a)
or Section 13(a) hereof, the holder of any Right thereafter
exercised shall become entitled to receive any shares of capital
stock of the Company other than Preferred Stock, thereafter the
number of such other shares so receivable upon exercise of any
Right shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Preferred Stock contained in
<PAGE>
Section 11(a), (b), (c), (d), (e), (g) through (k) and (m),
inclusive, and the provisions of Sections 7, 9, 10, 13 and 14
hereof with respect to the Preferred Stock shall apply on like
terms to any such other shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Exercise Price hereunder
shall evidence the right to purchase, at the adjusted Exercise
Price, the number of one one-thousandths of a share of Preferred
Stock (or other securities or amount of cash or combination
thereof) purchasable from time to time hereunder upon exercise of
the Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its
election as provided in Section 11(i), upon each adjustment of
the Exercise Price as a result of the calculations made in
Section 11(b) and (c), each Right outstanding immediately prior
to the making of such adjustment shall thereafter evidence the
right to purchase, at the adjusted Exercise Price, that number of
one one-thousandths of a share of Preferred Stock (calculated to
the nearest one ten-millionth) obtained by (i) multiplying (x)
the number of one one-thousandths of a share of Preferred Stock
for which a Right may be exercisable 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.
(i) The Company may elect on or after the date of any
adjustment of the Exercise Price to adjust the number of Rights,
in substitution for any adjustment in the number of shares of
Preferred Stock purchasable upon the exercise of a Right. Each
of the Rights outstanding after the adjustment in the number of
Rights shall be exercisable for the number of one one-thousandths
of a share of Preferred Stock for which a Right was exercisable
immediately prior to such adjustment. Each Right held of record
prior to such adjustment of the number of Rights shall become
that number of Rights (calculated to the nearest one hundred-
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 election to adjust the number of Rights, indicating the
record date for the adjustment, and, if known at the time, the
amount of the adjustment to be made. This record date may be the
date on which the Exercise Price is adjusted or any day
thereafter, but, if the Right Certificates have been issued,
shall be at least ten (10) days later than the date of the public
announcement. If Right Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section
11(i), the Company shall, as promptly as practicable, cause to be
distributed to holders of record of Right Certificates on such
record date Right Certificates evidencing, subject to Section 14
hereof, the additional Rights to which such holders shall be
entitled as a result of such adjustment, or, at the option of the
Company, shall cause to be distributed to such holders of record
in substitution and replacement for the Right Certificates held
<PAGE>
by such holders prior to the date of adjustment, and upon
surrender thereof, if required by the Company, new Right
Certificates evidencing all the Rights to which such holders
shall be entitled after such adjustment. Right Certificates so
to be distributed shall be issued, executed and countersigned in
the manner provided for herein (and may bear, at the option of
the Company, the adjusted Exercise Price) and shall be registered
in the names of the holders of record of Right Certificates on
the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the
Exercise Price or the number of one one-thousandths of a share of
Preferred Stock issuable upon the exercise of the Rights, the
Right Certificates theretofore and thereafter issued may continue
to express the Exercise Price per share and the number of shares
which were expressed in the initial Right Certificates issued
hereunder without prejudice to any adjustment or change.
(k) Before taking any action that would cause an
adjustment reducing the Exercise Price below the then stated
value, if any, of the number of one one-thousandths of a share of
Preferred Stock issuable upon exercise of the Rights, the Company
shall take any corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and
legally issue fully paid and nonassessable shares of Preferred
Stock at such adjusted Exercise Price.
(l) In any case in which this Section 11 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 Right exercised after such record date the number
of one one-thousandths of a share of Preferred Stock or other
capital stock or securities of the Company, if any, issuable upon
such exercise over and above the number of one one-thousandths of
a share of Preferred Stock and other capital stock or securities
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 evidencing such
holder's right to receive such additional shares upon the
occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such
reductions in the Exercise Price, in addition to those
adjustments expressly required by this Section 11, as and to the
extent that it in their good faith judgment a majority of the
Board of Directors shall determine to be advisable in order that
any consolidation or subdivision of the Preferred Stock, issuance
wholly for cash of any shares of Preferred Stock at less than the
Fair Market Value, issuance wholly for cash of shares of
Preferred Stock or securities which by their terms are
convertible into or exchangeable for shares of Preferred Stock,
stock dividends or issuance of rights, options or warrants
referred to hereinabove in this Section 11, hereafter made by the
Company to holders of its Preferred Stock, shall not be taxable
to such shareholders.
<PAGE>
(n) The Company covenants and agrees that it shall
not, at any time after the Distribution Date and so long as the
Rights have not been redeemed pursuant to Section 23 hereof or
exchanged pursuant to Section 24 hereof, (i) consolidate with
(other than a Subsidiary of the Company in a transaction which
complies with the last sentence of this Section 11(n)), (ii)
merge with or into, or (iii) sell or transfer (or permit any
Subsidiary to sell or transfer), in one transaction or a series
of related transactions, assets or earning power aggregating 50%
or more of the assets or earning power of the Company and its
Subsidiaries taken as a whole, to any other Person or Persons
(other than the Company and/or any of its Subsidiaries in one or
more transactions each of which complies with the last sentence
of this Section 11(n)) if (x) at the time of or immediately after
such consolidation, merger or sale there are any rights, warrants
or other instruments outstanding or agreements or arrangements in
effect which would substantially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights, or (y) prior
to, simultaneously with or immediately after such consolidation,
merger or sale the shareholders of a Person who constitutes, or
would constitute, the "Principal Party" for the purposes of
Section 13(a) hereof shall have received a distribution of Rights
previously owned by such Person or any of its Affiliates and
Associates; provided, however, that this Section 11(n) shall not
affect the ability of any Subsidiary of the Company to
consolidate with, merge with or into, or sell or transfer assets
or earning power to, any other Subsidiary of the Company. The
Company further covenants and agrees that after the Distribution
Date it will not, except as permitted by Section 23 or Section 27
hereof, take (or permit any Subsidiary to take) any action if at
the time such action is taken it is reasonably foreseeable that
such action will substantially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights.
(o) Notwithstanding anything in this Agreement to the
contrary, in the event the Company shall at any time after the
date of this Agreement and prior to the Distribution Date (i)
declare or pay any dividend on the outstanding Common Stock of
the Company payable in shares of Common Stock of the Company or
(ii) effect a subdivision, combination or consolidation of the
outstanding shares of Common Stock of the Company (by
reclassification or otherwise than by payment of dividends in
shares of Common Stock of the Company) into a greater or lesser
number of shares of Common Stock of the Company, then in any such
case (A) the number of one one-thousandths of a share of
Preferred Stock purchasable after such event upon proper exercise
of each Right shall be determined by multiplying the number of
one one-thousandths of a share of Preferred Stock so purchasable
immediately prior to such event by a fraction, the numerator of
which is the number of shares of Common Stock of the Company
outstanding immediately prior to such event and the denominator
of which is the number of shares of Common Stock of the Company
outstanding immediately after such event, and (B) each share of
Common Stock of the Company outstanding immediately after such
event shall have issued with respect to it that number of Rights
which each share of Common Stock of the Company outstanding
immediately prior to such event had issued with respect to it.
<PAGE>
The adjustments provided for in this Section 11(o) shall be made
successively whenever such a dividend is declared or paid or such
a subdivision, combination or consolidation is effected.
(p) The exercise of Rights under Section 11(a)(ii)
shall only result in the loss of rights under Section 11(a)(ii)
to the extent so exercised and shall not otherwise affect the
rights of holders of Right Certificates under this Rights
Agreement, including rights to purchase securities of the
Principal Party following a Section 13 Event which has occurred
or may thereafter occur, as set forth in Section 13 hereof. Upon
exercise of a Right Certificate under Section 11(a)(ii), the
Rights Agent shall return such Right Certificate duly marked to
indicate that such exercise has occurred.
Section 12. Certificate of Adjusted Exercise Price or
Number of Shares. Whenever an adjustment is made as provided in
Section 11 or Section 13 hereof, the Company shall (a) promptly
prepare a certificate setting forth such adjustment and a brief
statement of the facts accounting for such adjustment, (b)
promptly file with the Rights Agent and with each transfer agent
for the Preferred Stock and the Common Stock of the Company a
copy of such certificate and (c) mail a brief summary thereof to
each holder of a Right Certificate (or, if prior to the
Distribution Date, to each holder of a certificate representing
shares of Common Stock of the Company) in accordance with
Section 26 hereof. The Rights Agent shall be fully protected in
relying on any such certificate and on any adjustment contained
therein and shall not be deemed to have knowledge of any such
adjustment unless and until it shall have received such
certificate.
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power.
(a) In the event that, following the Stock Acquisition
Date, directly or indirectly, (x) the Company shall consolidate
with, or merge with and into, any other Person (other than a
Subsidiary of the Company in a transaction which is not
prohibited by Section 11(n) hereof), and the Company shall not be
the continuing or surviving corporation of such consolidation or
merger, (y) any Person (other than a Subsidiary of the Company in
a transaction which is not prohibited by the last sentence of
Section 11(n) hereof) shall consolidate with the Company, or
merge with and into the Company and the Company shall be the
continuing or surviving corporation of such merger and, in
connection with such merger, all or part of the shares of Common
Stock of the Company shall be changed into or exchanged for stock
or other securities of any other Person or cash or any other
property, or (z) the Company shall sell, mortgage or otherwise
transfer (or one or more of its Subsidiaries shall sell, mortgage
or otherwise transfer), in one transaction or a series of related
transactions, assets or earning power aggregating 50% or more of
the assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any other Person or Persons (other than the
Company or any Subsidiary of the Company in one or more
transactions, each of which is not prohibited by the last
<PAGE>
sentence of Section 11(n) hereof), then, and in each such case,
proper provision shall be made so that: (i) each holder of a
Right, except as provided in Section 7(e) hereof, shall have the
right to receive, upon the exercise thereof at the then current
Exercise Price in accordance with the terms of this Agreement,
such number of validly authorized and issued, fully paid and
nonassessable shares of freely tradeable Common Stock of the
Principal Party (as hereinafter defined in Section 13(b)), free
and clear of rights of call or first refusal, liens,
encumbrances, transfer restrictions or other adverse claims, as
shall be equal to the result obtained by (1) multiplying the then
current Exercise Price by the number of one one-thousandths of a
share of Preferred Stock for which a Right is exercisable
immediately prior to the first occurrence of a Section 13 Event,
and dividing that product by (2) 50% of the Fair Market Value
(determined pursuant to Section 11(d) hereof) per share of the
Common Stock of such Principal Party on the date of consummation
of such consolidation, merger, sale or transfer; (ii) such
Principal Party shall thereafter be liable for, and shall assume,
by virtue of such consolidation, merger, sale, mortgage or
transfer, all the obligations and duties of the Company pursuant
to this Agreement; (iii) the term "Company" shall thereafter be
deemed to refer to such Principal Party, it being specifically
intended that the provisions of Section 11 hereof shall apply to
such Principal Party; and (iv) such Principal Party shall take
such steps (including, but not limited to, the reservation of a
sufficient number of shares of its Common Stock to permit
exercise of all outstanding Rights in accordance with this
Section 13(a) and the making of payments in cash and/or other
securities in accordance with Section 11(a)(iii) hereof) in
connection with such consummation as may be necessary to assure
that the provisions hereof shall thereafter be applicable, as
nearly as reasonably may be, in relation to its shares of Common
Stock thereafter deliverable upon the exercise of the Rights.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in
clause (x) or (y) of the first sentence of Section 13(a),
the Person that is the issuer of any securities into which
shares of Common Stock of the Company are converted in such
merger or consolidation, or, if there is more than one such
issuer, the issuer of Common Stock that has the highest
aggregate Fair Market Value (determined pursuant to Section
11(d)), and if no securities are so issued, the Person that
is the other party to the merger or consolidation, or, if
there is more than one such Person, the Person the Common
Stock of which has the highest aggregate Fair Market Value
(determined pursuant to Section 11(d)); and
(ii) in the case of any transaction described in
clause (z) of the first sentence of Section 13(a), the
Person that is the party receiving the greatest portion of
the assets or earning power transferred pursuant to such
transaction or transactions, or, if each Person that is a
party to such transaction or transactions receives the same
portion of the assets or earning power transferred pursuant
<PAGE>
to such transaction or transactions or if the Person
receiving the largest portion of the assets or earning power
cannot be determined, whichever Person the Common Stock of
which has the highest aggregate Fair Market Value
(determined pursuant to Section 11(d));
provided, however, that in any such case, (1) if the Common Stock
of such Person is not at such time and has not been continuously
over the preceding 12-month period registered under Section 12 of
the Exchange Act ("Registered Common Stock"), or such Person is
not a corporation, and such Person is a direct or indirect
Subsidiary or Affiliate of another Person who has Registered
Common Stock outstanding, "Principal Party" shall refer to such
other Person; (2) if the Common Stock of such Person is not
Registered Common Stock or such Person is not a corporation, and
such Person is a direct or indirect Subsidiary of another Person
but is not a direct or indirect Subsidiary of another Person
which has Registered Common Stock outstanding, "Principal Party"
shall refer to the ultimate parent entity of such first-mentioned
Person; (3) if the Common Stock of such Person is not Registered
Common Stock or such Person is not a corporation, and such Person
is directly or indirectly controlled by more than one Person, and
one or more of such other Persons has Registered Common Stock
outstanding, "Principal Party" shall refer to whichever of such
other Persons is the issuer of the Registered Common Stock having
the highest aggregate Fair Market Value (determined pursuant to
Section 11(d)); and (4) if the Common Stock of such Person is not
Registered Common Stock or such Person is not a corporation, and
such Person is directly or indirectly controlled by more than one
Person, and none of such other Persons has Registered Common
Stock outstanding, "Principal Party" shall refer to whichever
ultimate parent entity is the corporation having the greatest
stockholders' equity or, if no such ultimate parent entity is a
corporation, "Principal Party" shall refer to whichever ultimate
parent entity is the entity having the greatest net assets.
(c) The Company shall not consummate any such
consolidation, merger, sale or transfer unless prior thereto (x)
the Principal Party shall have a sufficient number of authorized
shares of its Common Stock, which have not been issued or
reserved for issuance, to permit the exercise in full of the
Rights in accordance with this Section 13, and (y) the Company
and each Principal Party and each other Person who may become a
Principal Party as a result of such consolidation, merger, sale
or transfer shall have executed and delivered to the Rights Agent
a supplemental agreement providing for the terms set forth in
Section 13(a) and (b) and further providing that, as soon as
practicable after the date of any consolidation, merger, sale or
transfer of assets mentioned in Section 13(a), the Principal
Party at its own expense will:
(i) prepare and file a registration statement
under the Securities Act with respect to the Rights and the
securities purchasable upon exercise of the Rights on an
appropriate form, cause such registration statement to
become effective as soon as practicable after such filing
and cause such registration statement to remain effective
(with a prospectus that at all times meets the requirements
of the Securities Act) until the Expiration Date;
<PAGE>
(ii) qualify or register the Rights and the
securities purchasable upon exercise of the Rights under the
blue sky laws of such jurisdictions as may be necessary or
appropriate;
(iii) list (or continue the listing of) the
Rights and the securities purchasable upon exercise of the
Rights on a national securities exchange or to meet the
eligibility requirements for quotation on NASDAQ; and
(iv) deliver to holders of the Rights historical
financial statements for the Principal Party and each of its
Affiliates which comply in all respects with the
requirements for registration on Form 10 under the Exchange
Act.
(d) In case the Principal Party which is to be a party
to a transaction referred to in this Section 13 has a provision
in any of its authorized securities or in its Certificate of
Incorporation or By-laws or other instrument governing its
corporate affairs, which provision would have the effect of (i)
causing such Principal Party to issue (other than to holders of
Rights pursuant to this Section 13), in connection with, or as a
consequence of, the consummation of a transaction referred to in
this Section 13, shares of Common Stock of such Principal Party
at less than the then current Fair Market Value (determined
pursuant to Section 11(d)) or securities exercisable for, or
convertible into, Common Stock of such Principal Party at less
than such Fair Market Value, or (ii) providing for any special
payment, tax or similar provisions in connection with the
issuance of the Common Stock of such Principal Party pursuant to
the provisions of this Section 13, then, in such event, the
Company shall not consummate any such transaction unless prior
thereto the Company and such Principal Party shall have executed
and delivered to the Rights Agent a supplemental agreement
providing that the provision in question of such Principal Party
shall have been canceled, waived or amended, or that the
authorized securities shall be redeemed, so that the applicable
provision will have no effect in connection with, or as a
consequence of, the consummation of the proposed transaction.
The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other transfers.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue
fractions of Rights, except prior to the Distribution Date as
provided in Section 11(o) hereof, or to distribute Right
Certificates which evidence fractional Rights. If the Company
elects not to issue such fractional Rights, the Company shall
pay, in lieu of such fractional Rights, to the registered holders
of the Right Certificates with regard to which such fractional
Rights would otherwise be issuable, an amount in cash equal to
the same fraction of the Fair Market Value of a whole Right, as
determined pursuant to Section 11(d) hereof.
<PAGE>
(b) The Company shall not be required to issue
fractions of shares of Preferred Stock (other than fractions
which are integral multiples of one one-thousandth of a share of
Preferred Stock) upon exercise of the Rights or to distribute
certificates which evidence fractional shares of Preferred Stock
(other than fractions which are integral multiples of one one-
thousandth of a share of Preferred Stock). In lieu of fractional
shares of Preferred Stock that are not integral multiples of one
one-thousandth of a share of Preferred Stock, the Company may pay
to the registered holders of Right Certificates at the time such
Rights are exercised as herein provided an amount in cash equal
to the same fraction of the Fair Market Value of one one-
thousandth of a share of Preferred Stock. For purposes of this
Section 14(b), the Fair Market Value of one one-thousandth of a
share of Preferred Stock shall be determined pursuant to Section
11(d) hereof for the Trading Day immediately prior to the date of
such exercise.
(c) The holder of a Right by the acceptance of the
Rights expressly waives his right to receive any fractional
Rights or any fractional shares upon exercise of a Right, except
as permitted by this Section 14.
Section 15. Rights of Action. All rights of action in
respect of this Agreement, other than rights of action vested in
the Rights Agent pursuant to Sections 18 and 20 hereof, are
vested in the respective registered holders of the Right
Certificates (or, prior to the Distribution Date, the registered
holders of the Common Stock of the Company); and any registered
holder of any Right Certificate (or, prior to the Distribution
Date, of the Common Stock of the Company), without the consent of
the Right Agent or of the holder of any other Right Certificate
(or, prior to the Distribution Date, of the Common Stock of the
Company), may, in such registered holder's own behalf and for
such registered holder's own benefit, enforce, and may institute
and maintain any suit, action or proceeding against the Company
to enforce, or otherwise act in respect of, his right to exercise
the Right evidenced by such Right Certificate in the manner
provided in such Right Certificate and in this Agreement.
Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the
holders of Rights would not have an adequate remedy at law for
any breach of this Agreement and shall be entitled to specific
performance of the obligations hereunder and injunctive relief
against actual or threatened violations of the obligations
hereunder of any Person subject to this Agreement. Holders of
Rights shall be entitled to recover the reasonable costs and
expenses, including attorneys' fees, incurred by them in any
action to enforce the provisions of this Agreement.
Section 16. Agreement of Right Holders. Every holder of a
Right, by accepting the same, consents and agrees with the
Company and the Rights Agent and with every other holder of a
Right that:
(a) prior to the Distribution Date, each Right will be
transferable only simultaneously and together with the transfer
of shares of Common Stock of the Company;
<PAGE>
(b) after the Distribution Date, the Right
Certificates are transferable only on the registry books of the
Rights Agent if surrendered at the office or offices of the
Rights Agent designated for such purpose, duly endorsed or
accompanied by a proper instrument of transfer;
(c) subject to Sections 6(a) and 7(f), the Company and
the Rights Agent may deem and treat the person in whose name a
Right Certificate (or, prior to the Distribution Date, the
associated certificate representing Common Stock of the Company)
is registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the associated certificate
representing Common Stock of the Company made by anyone other
than the Company or the Rights Agent) for all purposes
whatsoever, and, subject to the last sentence of Section 7(e),
neither the Company nor the Rights Agent shall be affected by any
notice to the contrary; and
(d) notwithstanding anything in this Agreement to the
contrary, neither the Company nor the Rights Agent shall have any
liability to any holder of a Right or other Person as the result
of its inability to perform any of its obligations under this
Agreement by reason of any preliminary or permanent injunction or
other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative
agency or commission, or any statute, rule, regulation or
executive order promulgated or enacted by any governmental
authority prohibiting or otherwise restraining performance of
such obligations; provided, however, that the Company must use
its best efforts to have any such order, decree or ruling lifted
or otherwise overturned as soon as possible.
Section 17. Right Certificate Holder Not Deemed a
Shareholder. No holder, as such, of any Right Certificate shall
be entitled to vote, receive dividends or be deemed for any
purpose the holder of the shares of Preferred Stock or any other
securities of the Company which may at any time be issuable on
the exercise of the Rights represented thereby, nor shall
anything contained herein or in any Right Certificate be
construed to confer upon the holder of any Right Certificate, as
such, any of the rights of a shareholder of the Company or any
right to vote for the election of directors or upon any matter
submitted to shareholders at any meeting thereof, or to give or
withhold consent to any corporate action, or to receive notice of
meetings or other actions affecting shareholders (except as
provided in Section 25 hereof), or to receive dividends or
subscription rights, or otherwise, until the Right or Rights
evidenced by such Right Certificate shall have been exercised in
accordance with the provisions hereof.
Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent such
compensation as shall be agreed to in writing between the Company
and the Rights Agent for all services rendered by it hereunder
and, from time to time, on demand of the Rights Agent, its
<PAGE>
reasonable expenses and counsel fees and disbursements and other
disbursements incurred in the administration and execution of
this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent
for, and to hold it harmless against, any loss, liability, or
expense, incurred without gross negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything done or
omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the costs and
expenses of defending against any claim of liability arising
therefrom, directly or indirectly. The provisions of this
Section 18(a) shall survive the expiration of the Rights and the
termination of this Agreement.
(b) The Rights Agent shall be protected and shall
incur no liability for or in respect of any action taken,
suffered or omitted by it in connection with its administration
of this Agreement in reliance upon any Right Certificate or
certificate representing Common Stock of the Company, Preferred
Stock, or other securities of the Company, instrument of
assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, direction, consent, certificate,
statement, or other paper or document believed by it to be
genuine and to be signed and executed by the proper Person or
Persons.
(c) The Rights Agent shall not be liable for
consequential damages under any provision of this Agreement or
for any consequential damages arising out of any act or failure
to act hereunder.
Section 19. Merger or Consolidation or Change of Name of
Rights Agent.
(a) Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to the
corporate trust or shareholder services business of the Rights
Agent or any successor Rights Agent, shall be the successor to
the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation would be eligible
for appointment as a successor Rights Agent under the provisions
of Section 21 hereof. In case at the time such successor Rights
Agent shall succeed to the agency created by this Agreement, any
of the Right Certificates shall have been countersigned but not
delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such
Right Certificates so countersigned; and in case at that time any
of the Right Certificates shall not have been countersigned, any
successor Rights Agent may countersign such Right Certificates
either in the name of the predecessor or in the name of the
successor Rights Agent; and in all such cases such Right
Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
<PAGE>
(b) In case at any time the name of the Rights Agent
shall be changed and at such time any of the Right Certificates
shall have been countersigned but not delivered, the Rights Agent
may adopt the countersignature under its prior name and deliver
Right Certificates so countersigned; and in case at that time any
of the Right Certificates shall not have been countersigned, the
Rights Agent may countersign such Right Certificates either in
its prior name or in its changed name; and in all such cases such
Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations expressly imposed by this
Agreement upon the following terms and conditions, by all of
which the Company and the holders of Right Certificates, by their
acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel
selected by it (who may be legal counsel for the Company), and
the opinion of such counsel shall be full and complete
authorization and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with such
opinion.
(b) Whenever in the performance of its duties under
this Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter (including, without limitation,
the identity of any Acquiring Person and the determination of
"Fair Market Value") be proved or established by the Company
prior to taking or suffering any action hereunder, such fact or
matter (unless other evidence in respect thereof shall be herein
specifically prescribed) may be deemed to be conclusively proved
and established by a certificate signed by a person believed by
the Rights Agent to be the Chairman of the Board of Directors, a
Vice Chairman of the Board of Directors, the President, a Vice
President, the Treasurer, any Assistant Treasurer, the Secretary
or an Assistant Secretary of the Company and delivered to the
Rights Agent. Any such certificate shall be full authorization
to the Rights Agent for any action taken or suffered in good
faith by it under the provisions of this Agreement in reliance
upon such certificate.
(c) The Rights Agent shall be liable hereunder only
for its own gross negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained in
this Agreement or in the Right Certificates (except its
countersignature thereof) or be required to verify the same, but
all such statements and recitals are and shall be deemed to have
been made by the Company only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or
the execution and delivery hereof (except the due execution
hereof by the Rights Agent) or in respect of the validity or
execution of any Right Certificate (except its countersignature
<PAGE>
thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement
or in any Right Certificate; nor shall it be responsible for any
change in the exercisability of the Rights (including the Rights
becoming void pursuant to Section 7(e) hereof) or any adjustment
required under the provisions of Sections 11, 13 or 23(c) hereof
or responsible for the manner, method or amount of any such
adjustment or the ascertaining of the existence of facts that
would require any such adjustment (except with respect to the
exercise of Rights evidenced by Right Certificates after receipt
of a certificate describing any such adjustment furnished in
accordance with Section 12 hereof), nor shall it be responsible
for any determination by the Board of Directors of the Company of
the Fair Market Value of the Rights or Preferred Stock pursuant
to the provisions of Section 14 hereof; nor shall it by any act
hereunder be deemed to make any representation or warranty as to
the authorization or reservation of any shares of Common Stock of
the Company or Preferred Stock to be issued pursuant to this
Agreement or any Right Certificate or as to whether any shares of
Common Stock of the Company or Preferred Stock will, when so
issued, be validly authorized and issued, fully paid and
nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts,
instruments and assurances as may reasonably be required by the
Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its
duties hereunder and certificates delivered pursuant to any
provision hereof from any person believed by the Rights Agent to
be the Chairman of the Board of Directors, any Vice Chairman of
the Board of Directors, the President, a Vice President, the
Secretary, an Assistant Secretary, the Treasurer or an Assistant
Treasurer of the Company, and is authorized to apply to such
officers for advice or instructions in connection with its
duties, and it shall not be liable for any action taken or
suffered to be taken by it in good faith in accordance with
instructions of any such officer. Any application by the Rights
Agent for written instructions from the Company may, at the
option of the Rights Agent, set forth in writing any action
proposed to be taken or omitted by the Rights Agent under this
Agreement and the date on or after which such action shall be
taken or such omission shall be effective. The Rights Agent
shall not be liable for any action taken by, or omission of, the
Rights Agent in accordance with a proposal included in such
application on or after the date specified in such application
(which date shall not be less than five Business Days after the
date any officer of the Company actually receives such
application, unless any such officer shall have consented in
writing to an earlier date) unless, prior to taking any such
action (or the effective date in the case of an omission), the
Rights Agent shall have received written instructions in response
to such application specifying the action to be taken or omitted.
<PAGE>
(h) The Rights Agent and any shareholder, director,
officer or employee of the Rights Agent may buy, sell or deal in
any of the Rights or other securities of the Company or become
pecuniarily interested in any transaction in which the Company
may be interested, or contract with or lend money to the Company
or otherwise act as fully and freely as though it were not the
Rights Agent under this Agreement. Nothing herein shall preclude
the Rights Agent from acting in any other capacity for the
Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents.
(j) No provision of this Agreement shall require the
Rights Agent to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties
hereunder or in the exercise of its rights if there shall be
reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not
reasonably assured to it.
(k) If, with respect to any Right Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate attached to the form of assignment or form of
election to purchase, as the case may be, has either not been
completed or indicates an affirmative response to clause (1) or
clause (2) thereof, the Rights Agent shall not take any further
action with respect to such requested exercise or transfer
without first consulting with the Company.
Section 21. Change of Rights Agent. The Rights Agent or
any successor Rights Agent may resign and be discharged from its
duties under this Agreement upon thirty (30) days' notice in
writing mailed to the Company by first class mail. The Company
may remove the Rights Agent or any successor Rights Agent (with
or without cause) upon thirty (30) days' notice in writing,
mailed to the Rights Agent or successor Rights Agent, as the case
may be, and to each transfer agent of the Common Stock of the
Company and Preferred Stock by registered or certified mail, and
to the holders of the Right Certificates by first-class mail. If
the Rights Agent shall resign or be removed or shall otherwise
become incapable of acting, the Company shall appoint a successor
to the Rights Agent. If the Company shall fail to make such
appointment within a period of thirty (30) days after giving
notice of such removal or after it has been notified in writing
of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the holder of a Right
Certificate (who shall, with such notice, submit his Right
Certificate for inspection by the Company), then the incumbent
Rights Agent or the registered holder of any Right Certificate
may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor Rights Agent,
whether appointed by the Company or by such a court, shall be (a)
a corporation organized and doing business under the laws of the
United States or of the State of New York (or of any other state
of the United States so long as such corporation is authorized to
<PAGE>
do business as a banking institution in the State of New York),
in good standing, which is authorized under such laws to exercise
stock transfer or corporate trust powers and is subject to
supervision or examination by federal or state authority and
which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $100,000,000 or (b) an
Affiliate of a corporation described in clause (a) of this
sentence. After appointment, the successor Rights Agent shall be
vested with the same powers, rights, duties and responsibilities
as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall
deliver and transfer to the successor Rights Agent any property
at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the
purpose. Not later than the effective date of any such
appointment, the Company shall file notice thereof in writing
with the predecessor Rights Agent and each transfer agent of the
Common Stock of the Company and the Preferred Stock, and mail a
notice thereof in writing to the registered holders of the Right
Certificates. Failure to give any notice provided for in this
Section 21, however, or any defect therein, shall not affect the
legality or validity of the resignation or removal of the Rights
Agent or the appointment of the successor Rights Agent, as the
case may be.
Section 22. Issuance of New Right Certificates.
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new
Right Certificates evidencing Rights in such form as may be
approved by its Board of Directors to reflect any adjustment or
change in the Exercise Price per share and the number or kind or
class of shares of stock or other securities or property
purchasable under the Right Certificates made in accordance with
the provisions of this Agreement. In addition, in connection
with the issuance or sale of shares of Common Stock of the
Company following the Distribution Date and prior to the
redemption or expiration of the Rights, the Company (a) shall,
with respect to shares of Common Stock of the Company so issued
or sold pursuant to the exercise of stock options or under any
employee plan or arrangement, or upon the exercise, conversion or
exchange of securities hereafter 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 Right Certificates
representing the appropriate number of Rights in connection with
such issuance or sale; provided, however, that (i) no such Right
Certificate shall be issued if, and to the extent that, the
Company shall be advised by counsel that such issuance would
create a significant risk of material adverse tax consequences to
the Company or the person to whom such Right Certificate would be
issued, and (ii) no such Right Certificate shall be issued if,
and to the extent that, appropriate adjustments shall otherwise
have been made in lieu of the issuance thereof.
<PAGE>
Section 23. Redemption.
(a) The Board of Directors of the Company may, at its
option, redeem all but not less than all of the then outstanding
Rights at a redemption price of $0.01 per Right, appropriately
adjusted to reflect any dividend declared or paid on the Common
Stock of the Company in shares of Common Stock of the Company or
any subdivision or combination of the outstanding shares of
Common Stock of the Company or similar event occurring after the
date of this Agreement (such redemption price, as adjusted from
time to time, being hereinafter referred to as the "Redemption
Price"). The Rights may be redeemed only until the earliest to
occur of (i) 5:00 P.M., New York, New York time, on the tenth
calendar day after the Stock Acquisition Date or (ii) the Final
Expiration Date.
(b) Immediately upon the action of the Board of
Directors ordering the redemption of the Rights, and without any
further action and without any notice, the right to exercise the
Rights will terminate and the only right thereafter of the
holders of Rights shall be to receive the Redemption Price for
each Right so held. Promptly after the action of the Board of
Directors ordering the redemption of the Rights, the Company
shall give notice of such redemption to the Rights Agent and the
holders of the then outstanding Rights by mailing such notice to
the Rights Agent and to all such holders at their last addresses
as they appear upon the registry books of the Rights Agent or,
prior to the Distribution Date, on the registry books of the
Transfer Agent for the Common Stock 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. The
Company promptly shall mail a notice of any such exchange to all
of the holders of such Rights at their last addresses as they
appear upon the registry books of the Rights Agent. Any notice
which is mailed in the manner herein provided shall be deemed
given, whether or not the holder receives the notice. Each such
notice of redemption will state the method by which the payment
of the Redemption Price will be made. Neither the Company nor
any of its Affiliates or Associates may redeem, acquire or
purchase for value any Rights at any time in any manner other
than that specifically set forth in this Section 23 or Section 24
hereof or in connection with the purchase of shares of Common
Stock of the Company prior to the Distribution Date.
(c) The Company may, at its option, pay the Redemption
Price in cash, shares of Common Stock of the Company (based on
the Fair Market Value of the Common Stock of the Company as of
the time of redemption) or any other form of consideration deemed
appropriate by the Board of Directors.
Section 24. Exchange.
(a) The Board of Directors of the Company may, at its
option, at any time on or after the occurrence of a Section
11(a)(ii) Event, exchange all or part of the then outstanding and
exercisable Rights (which shall not include Rights that have
become void pursuant to the provisions of Section 7(e) hereof)
<PAGE>
for shares of Common Stock of the Company at an exchange ratio of
one share of Common Stock of the Company per Right, appropriately
adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof (such exchange ratio
being hereinafter referred to as the "Exchange Ratio").
Notwithstanding the foregoing, the Board of Directors shall not
be empowered to effect such exchange at any time after any Person
(other than an Exempt Person), together with all Affiliates and
Associates of such Person, becomes the Beneficial Owner of 50% or
more of the Common Stock of the Company.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the exchange of any Rights
pursuant to subsection (a) of this Section 24 and without any
further action and without any notice, the right to exercise such
Rights shall terminate and the only right thereafter of a holder
of such Rights shall be to receive that number of shares of
Common Stock of the Company equal to the number of such Rights
held by such holder multiplied by the Exchange Ratio. The
Company shall promptly give notice of any such exchange in
accordance with Section 26 hereof; provided, however, that the
failure to give, or any defect in, such notice shall not affect
the validity of such exchange. The Company promptly shall mail a
notice of any such exchange to all of the holders of such Rights
at their last addresses as they appear upon the registry books of
the Rights Agent. Any notice 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 shares of Common Stock of the
Company for Rights will be effected and, in the event of any
partial exchange, the number of Rights which will be exchanged.
Any partial exchange shall be effected pro rata based on the
number of Rights (other than Rights which have become void
pursuant to the provisions of Section 7(e) hereof) held by each
holder of Rights.
(c) In any exchange pursuant to this Section 24, the
Company, at its option, may substitute Preferred Stock (or
Preferred Stock Equivalent, as such term is defined in Section
11(b) hereof) for Common Stock of the Company exchangeable for
Rights, at the initial rate of one one-thousandth of a share of
Preferred Stock (or preferred stock equivalent) for each share of
Common Stock of the Company, as appropriately adjusted to reflect
adjustments in the voting rights of the Preferred Stock pursuant
to the terms thereof, so that the fraction of a share of
Preferred Stock delivered in lieu of each share of Common Stock
of the Company shall have the same voting rights as one share of
Common Stock of the Company.
(d) In the event that there shall not be sufficient
shares of Common Stock of the Company or Preferred Stock (or
Preferred Stock Equivalent) issued but not outstanding or
authorized but unissued to permit any exchange of Rights as
contemplated in accordance with this Section 24, the Company
shall take all such action as may be necessary to authorize
additional shares of Common Stock of the Company or Preferred
Stock (or Preferred Stock Equivalent) for issuance upon exchange
of the Rights.
<PAGE>
(e) The Company shall not be required to issue
fractions of Common Stock of the Company or to distribute
certificates which evidence fractional shares of Common Stock of
the Company. If the Company elects not to issue such fractional
shares of Common Stock of the Company, the Company shall pay, in
lieu of such fractional shares of Common Stock of the Company, to
the registered holders of the Right Certificates with regard to
which such fractional shares of Common Stock of the Company would
otherwise be issuable, an amount in cash equal to the same
fraction of the Fair Market Value of a whole share of Common
Stock of the Company. For the purposes of this paragraph (e),
the Fair Market Value of a whole share of Common Stock of the
Company shall be the closing price of a share of Common Stock of
the Company (as determined pursuant to the second sentence of
Section 11(d)(i) hereof) for the Trading Day immediately prior to
the date of exchange pursuant to this Section 24.
Section 25. Notice of Certain Events.
(a) In case the Company shall propose, at any time
after the Distribution Date, (i) to pay any dividend payable in
stock of any class to the holders of Preferred Stock or to make
any other distribution to the holders of Preferred Stock (other
than a regular periodic cash dividend out of earnings or retained
earnings of the Company), or (ii) to offer to the holders of
Preferred Stock rights or warrants to subscribe for or to
purchase any additional shares of Preferred Stock or shares of
stock of any class or any other securities, rights or options, or
(iii) to effect any reclassification of its Preferred Stock
(other than a reclassification involving only the subdivision of
outstanding shares of Preferred Stock), or (iv) to effect any
consolidation or merger into or with, or to effect any sale,
mortgage or other transfer (or to permit one or more of its
Subsidiaries to effect any sale, mortgage or other transfer), in
one transaction or a series of related transactions, of 50% or
more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to, any other Person (other than
a Subsidiary of the Company in one or more transactions each of
which is not prohibited by the last sentence of Section 11(n)
hereof), or (v) to effect the liquidation, dissolution or winding
up of the Company, (vi) to declare or pay any dividend on the
Common Stock of the Company payable in Common Stock of the
Company or to effect a subdivision, combination or consolidation
of the Common Stock of the Company (by reclassification or
otherwise than by payment of dividends in Common Stock of the
Company) then in each such case, the Company shall give to each
holder of a Right Certificate and to the Rights Agent, in
accordance with Section 26 hereof, a notice of such proposed
action, which shall specify the record date for the purposes of
such stock dividend, distribution of rights or warrants, or the
date on which such reclassification, consolidation, merger, sale,
transfer, liquidation, dissolution, or winding up is to take
place and the date of participation therein by the holders of the
shares of Common Stock of the Company and/or Preferred Stock, if
any such date is to be fixed, and such notice shall be so given
in the case of any action covered by clause (i) or (ii) above at
least twenty (20) days prior to the record date for determining
<PAGE>
holders of the shares of Preferred Stock for purposes of such
action, and in the case of any such other action, at least twenty
(20) days prior to the date of the taking of such proposed action
or the date of participation therein by the holders of the shares
of Common Stock of the Company and/or Preferred Stock, whichever
shall be the earlier; provided, however, no such notice shall be
required pursuant to this Section 25 if any Subsidiary of the
Company effects a consolidation or merger with or into, or
effects a sale or other transfer of assets or earnings power to,
any other Subsidiary of the Company in a manner not inconsistent
with the provisions of this Agreement.
(b) In case any Section 11(a)(ii) Event shall occur,
then, in any such case, the Company shall as soon as practicable
thereafter give to each registered holder of a Right Certificate
and to the Rights Agent, in accordance with Section 26 hereof, a
notice of the occurrence of such event, which shall specify the
event and the consequences of the event to holders of Rights
under Section 11(a)(ii) hereof.
Section 26. Notices. Notices or demands authorized by this
Agreement to be given or made by the Rights Agent or by the
holder of any Right Certificate to or on the Company shall be
sufficiently given or made if sent by first-class mail, postage
prepaid, facsimile transmission or by nationally recognized
overnight courier addressed (until another address is filed in
writing with the Rights Agent) as follows:
Sovran Self Storage, Inc.
5166 Main Street
Williamsville, NY 14221
Attention: Secretary
Subject to the provisions of Section 21, any notice or demand
authorized by this Agreement to be given or made by the Company
or by the holder of any Right Certificate to or on the Rights
Agent shall be sufficiently given or made if sent by first-class
mail, postage prepaid, facsimile transmission or by
nationally-recognized overnight courier addressed (until another
address is filed in writing with the Company) as follows:
American Stock Transfer and Trust Company
40 Wall Street
New York, NY 10005
Attention: Administration
Notices or demands authorized by this Agreement to be given or
made by the Company or the Rights Agent to the holder of any
Right Certificate (or, prior to the Distribution Date, to the
holder of any certificate representing shares of Common Stock of
the Company) shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed to such holder at
the address of such holder as shown on the registry books of the
Company.
Section 27. Supplements and Amendments. Prior to the
Distribution Date, the Company and the Rights Agent shall, if the
<PAGE>
Company so directs, supplement or amend any provision of this
Agreement as the Company may deem necessary or desirable
without the approval of any holders of certificates representing
shares of Common Stock of the Company. From and after the
Distribution Date, the Company and the Rights Agent shall, if the
Company so directs, supplement or amend this Agreement without
the approval of any holder of Right Certificates in order (i) to
cure any ambiguity, (ii) to correct or supplement any provision
contained herein which may be defective or inconsistent with any
other provisions herein, (iii) to shorten or lengthen any time
period hereunder, or (iv) to change or supplement the provisions
hereof in any manner which the Company may deem necessary or
desirable and which shall not adversely affect the interests of
the holders of Right Certificates (other than an Acquiring Person
or any Affiliate or Associate of an Acquiring Person); provided,
however, that from and after the Distribution Date this Agreement
may not be supplemented or amended to lengthen, pursuant to
clause (iii) of this sentence, (A) a time period relating to when
the Rights may be redeemed at such time as the Rights are not
then redeemable or (B) any other time period unless such
lengthening is for the purpose of protecting, enhancing or
clarifying the rights of, and the benefits to, the holders of
Rights (other than an Acquiring Person or any Affiliate or
Associate of an Acquiring Person). Upon the delivery of such
certificate from an appropriate officer of the Company which
states that the proposed supplement or amendment is in compliance
with the terms of this Section 27, the Rights Agent shall execute
such supplement or amendment. Prior to the Distribution Date,
the interests of the holders of Rights shall be deemed coincident
with the interests of the holders of Common Stock of the Company.
Notwithstanding any other provision hereof, the Rights Agent's
consent must be obtained regarding any amendment or supplement
pursuant to this Section 27 which alters the Rights Agent's
rights or duties.
Section 28. Successors. All the covenants and provisions
of this Agreement by or for the benefit of the Company or the
Rights Agent shall bind and inure to the benefit of their
respective successors and assigns hereunder.
Section 29. Determinations and Actions by the Board of
Directors. For all purposes of this Agreement, any calculation
of the number of shares of Common Stock of the Company
outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding shares
of Common Stock of the Company 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 Rules under the Exchange
Act as in effect on the date hereof. The Board of Directors of
the Company shall have the exclusive power and authority to
administer this Agreement and to exercise all rights and powers
specifically granted to the Board of Directors or to the Company,
or as may be necessary or advisable in the administration of this
Agreement, including without limitation, the right and power to
(i) interpret the provisions of this Agreement and (ii) make all
determinations deemed necessary or advisable for the
administration of this Agreement (including a determination to
<PAGE>
redeem or not redeem the Rights or to amend the Agreement). All
such actions, calculations, interpretations and determinations
(including, for purposes of clause (y) below, all omissions with
respect to the foregoing) which are done or made by the Board of
Directors in good faith shall (x) be final, conclusive and
binding on the Company, the Rights Agent, the holders of the
Rights and all other parties, and (y) not subject any member of
the Board of Directors to any liability to the holders of the
Rights or to any other person.
Section 30. Benefits of this Agreement. Nothing in this
Agreement shall be construed to give to any person or corporation
other than the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution
Date, the Common Stock of the Company) any legal or equitable
right, remedy or claim under this Agreement; but this Agreement
shall be for the sole and exclusive benefit of the Company, the
Rights Agent and the registered holders of the Right Certificates
(and, prior to the Distribution Date, registered holders of the
Common Stock of the Company).
Section 31. Severability. If any term, provision, covenant
or restriction of this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants
and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated;
provided, however, that notwithstanding anything in this
Agreement to the contrary, if any such term, provision, covenant
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 Agreement would adversely affect the purpose or
effect of the Agreement, the right of redemption set forth in
Section 23 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 Board of Directors.
Section 32. Governing Law. This Agreement, each Right and
each Right Certificate issued hereunder shall be deemed to be a
contract made under the laws of the State of Maryland and for all
purposes shall be governed by and construed in accordance with
the laws of such State applicable to contracts to be made and to
be performed entirely within Maryland.
Section 33. Counterparts. This Agreement may be executed
in any number of counterparts and each of such counterparts shall
for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same
instrument.
Section 34. Descriptive Headings. Descriptive headings of
the several Sections of this Agreement are inserted for
convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
[Remainder of page intentionally left blank.]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as an instrument under seal and
attested, all as of the day and year first above written.
ATTEST: SOVRAN SELF STORAGE, INC.
By:/s/ David L. Rogers By:/s/ Kenneth F. Myszka
Name: David L. Rogers Name: Kenneth F. Myszka
Title: Secretary Title: President
ATTEST: AMERICAN STOCK TRANSFER AND
TRUST COMPANY, as Rights Agent
By:/s/ Susan Silber By:/s/ Herbert J. Lemmer
Name: Susan Silber Name: Herbert J. Lemmer
Title: Assistant Secretary Title: Vice President
<PAGE>
Exhibit A
FORM OF
ARTICLES SUPPLEMENTARY
CLASSIFYING AND DESIGNATING A SERIES OF PREFERRED STOCK
AS
SERIES A JUNIOR PARTICIPATING CUMULATIVE PREFERRED STOCK
OF
SOVRAN SELF STORAGE, INC.
Pursuant to Section 2-201 of the General Corporation Law
of the State of Maryland
We, Kenneth F. Myszka and David L. Rogers, being the
President and the Secretary, respectively, of SOVRAN SELF
STORAGE, INC., a corporation organized and existing under the
General Corporation Law of the State of Maryland (the
"Corporation"), in accordance with the provisions of Section
1-301 thereof, DO HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board of
Directors by the Articles of Incorporation of the Corporation, on
November 6, 1996, the Board of Directors adopted the following
resolution creating a series of 250,000 shares of Preferred Stock
designated as "Series A Junior Participating Cumulative Preferred
Stock":
"RESOLVED, that pursuant to the
authority vested in the Board of Directors of
the Corporation in accordance with the
provisions of its Articles of Incorporation,
a series of Preferred Stock, par value $.01
per share, of the Corporation be, and it
hereby is, created, with such voting powers,
preferences and relative, participating,
optional or other special rights, and such
qualifications, limitations or restrictions
thereof, as follows:
Section 1. Designation and Amount. There shall be a series
of Preferred Stock of the Corporation which shall be designated
as "Series A Junior Participating Cumulative Preferred Stock,"
par value $.01 per share (hereinafter called "Series A Preferred
Stock"), and the number of shares constituting such series shall
be 250,000. Such number of shares may be increased or decreased
by resolution of the Board of Directors and by the filing of
articles of amendment pursuant to the provisions of the General
Corporation Law of the State of Maryland stating that such
increase or reduction has been so authorized; provided, however,
that no decrease shall reduce the number of shares of Series A
<PAGE>
Preferred Stock to a number less than that of the shares then
outstanding plus the number of shares of Series A Preferred Stock
issuable upon exercise of outstanding rights, options or warrants
or upon conversion of outstanding securities issued by the
Corporation.
Section 2. Dividends and Distributions.
(A) (i) Subject to the rights of the holders of any shares
of any series of preferred stock (or any similar stock) ranking
prior and superior to the Series A Preferred Stock with respect
to dividends, the holders of Series A Preferred Stock, in
preference to the holders of common stock and of any other junior
stock, shall be entitled to receive, when, as and if declared by
the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the first day of
March, June, September and December in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"),
commencing on the first Quarterly Dividend Payment Date after the
first issuance of a share or fraction of a Series A Preferred
Share, in an amount per share (rounded to the nearest cent) equal
to the greater of (a) $1.00 or (b) subject to the provisions for
adjustment hereinafter set forth, 1,000 times the aggregate per
share amount of all cash dividends, and 1,000 times the aggregate
per share amount (payable in kind) of all non-cash dividends or
other distributions other than a dividend payable in shares of
common stock or a subdivision of the outstanding shares of common
stock (by reclassification or otherwise), declared on the shares
of common stock since the immediately preceding Quarterly
Dividend Payment Date, or, with respect to the first Quarterly
Dividend Payment Date, since the first issuance of any share or
fraction of a Series A Preferred Share. The multiple of cash and
non-cash dividends declared on the shares of common stock to
which holders of the Series A Preferred Stock are entitled, which
shall be 1,000 initially but which shall be adjusted from time to
time as hereinafter provided, is hereinafter referred to as the
"Dividend Multiple." In the event the Corporation shall at any
time after November 27, 1996 (the "Rights Declaration Date") (i)
declare or pay any dividend on the shares of common stock payable
in shares of common stock, or (ii) effect a subdivision or
combination or consolidation of the outstanding shares of common
stock (by reclassification or otherwise than by payment of a
dividend in shares of common stock) into a greater or lesser
number of shares of common stock, then in each such case the
Dividend Multiple thereafter applicable to the determination of
the amount of dividends which holders of Series A Preferred Stock
shall be entitled to receive shall be the Dividend Multiple
applicable immediately prior to such event multiplied by a
fraction, the numerator of which is the number of shares of
common stock outstanding immediately after such event and the
denominator of which is the number of shares of common stock that
were outstanding immediately prior to such event.
(ii) Notwithstanding anything else contained in this
paragraph (A), the Corporation shall, out of funds legally
available for that purpose, declare a dividend or distribution on
the Series A Preferred Stock as provided in this paragraph (A)
<PAGE>
immediately after it declares a dividend or distribution on the
shares of common stock (other than a dividend payable in shares
of common stock); provided that, in the event no dividend or
distribution shall have been declared on the shares of common
stock during the period between any Quarterly Dividend Payment
Date and the next subsequent Quarterly Dividend Payment Date, a
dividend of $1.00 per share on the Series A Preferred Stock shall
nevertheless be payable on such subsequent Quarterly Dividend
Payment Date.
(B) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such
Series A Preferred Stock, unless the date of issue of such shares
is prior to the record date for the first Quarterly Dividend
Payment Date, in which case dividends on such shares shall begin
to accrue from the date of issue of such shares, or unless the
date of issue is a Quarterly Dividend Payment Date or is a date
after the record date for the determination of holders of shares
of Series A Preferred Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment Date, in
either of which events such dividends shall begin to accrue and
be cumulative from such Quarterly Dividend Payment Date. Accrued
but unpaid dividends shall not bear interest. Dividends paid on
the shares of Series A Preferred Stock in an amount less than the
total amount of such dividends at the time accrued and payable on
such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of
Directors may fix in accordance with applicable law a record date
for the determination of holders of shares of Series A Preferred
Stock entitled to receive payment of a dividend or distribution
declared thereon, which record date shall be not more than such
number of days prior to the date fixed for the payment thereof as
may be allowed by applicable law.
Section 3. Voting Rights. In addition to any other voting
rights required by law, the holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth, each Series A Preferred Share shall entitle the holder
thereof to 1,000 votes on all matters submitted to a vote of the
shareholders of the Corporation. The number of votes which a
holder of a Series A Preferred Share is entitled to cast, which
shall initially be 1,000 but which may be adjusted from time to
time as hereinafter provided, is hereinafter referred to as the
"Vote Multiple." In the event the Corporation shall at any time
after the Rights Declaration Date (i) declare or pay any dividend
on shares of common stock payable in shares of common stock, or
(ii) effect a subdivision or combination or consolidation of the
outstanding shares of common stock (by reclassification or
otherwise than by payment of a dividend in shares of common
stock) into a greater or lesser number of shares of common stock,
then in each such case the Vote Multiple thereafter applicable to
the determination of the number of votes per share to which
holders of shares of Series A Preferred Stock shall be entitled
shall be the Vote Multiple immediately prior to such event
<PAGE>
multiplied by a fraction, the numerator of which is the number of
shares of common stock outstanding immediately after such event
and the denominator of which is the number of shares of common
stock that were outstanding immediately prior to such event.
(B) Except as otherwise provided herein or by law, the
holders of shares of Series A Preferred Stock and the holders of
shares of common stock and the holders of shares of any other
capital stock of this Corporation having general voting rights,
shall vote together as one class on all matters submitted to a
vote of shareholders of the Corporation.
(C) (i) Whenever, at any time or times, dividends
payable on any shares of Series A Preferred Stock shall be
in arrears in an amount equal to at least two full quarter
dividends (whether or not declared and whether or not
consecutive), the holders of record of the outstanding
shares of Series A Preferred Stock shall have the exclusive
right, voting separately as a single class, to elect two
directors of the Corporation at a special meeting of
shareholders of the Corporation or at the Corporation's next
annual meeting of shareholders, and at each subsequent
annual meeting of shareholders, as provided below. At
elections for such directors, each Series A Preferred Share
shall entitle the holder thereof to 1,000 votes in such
elections.
(ii) Upon the vesting of such right of the holders
of shares of Series A Preferred Stock, the maximum
authorized number of members of the Board of Directors shall
automatically be increased by two and the two vacancies so
created shall be filled by vote of the holders of the
outstanding shares of Series A Preferred Stock as
hereinafter set forth. A special meeting of the
shareholders of the Corporation then entitled to vote shall
be called by the Chairman of the Board of Directors or the
President or the Secretary of the Corporation, if requested
in writing by the holders of record of not less than 10% of
the shares of Series A Preferred Stock then outstanding. At
such special meeting, or, if no such special meeting shall
have been called, then at the next annual meeting of
shareholders of the Corporation, the holders of the shares
of Series A Preferred Stock shall elect, voting as above
provided, two directors of the Corporation to fill the
aforesaid vacancies created by the automatic increase in the
number of members of the Board of Directors. At any and all
such meetings for such election, the holders of a majority
of the outstanding shares of Series A Preferred Stock shall
be necessary to constitute a quorum for such election,
whether present in person or proxy, and such two directors
shall be elected by the vote of at least a majority of the
shares of Series A Preferred Stock held by such shareholders
present or represented at the meeting. Any director elected
by holders of shares of Series A Preferred Stock pursuant to
this Section may be removed at any annual or special
meeting, by vote of a majority of the shareholders voting as
a class who elected such director, with or without cause.
<PAGE>
In case any vacancy shall occur among the directors elected
by the holders of shares of Series A Preferred Stock
pursuant to this Section, such vacancy may be filled by the
remaining director so elected, or his successor then in
office, and the director so elected to fill such vacancy
shall serve until the next meeting of shareholders for the
election of directors. After the holders of shares of
Series A Preferred Stock shall have exercised their right to
elect directors in any default period and during the
continuance of such period, the number of directors shall
not be further increased or decreased except by vote of the
holders of shares of Series A Preferred Stock as herein
provided or pursuant to the rights of any equity securities
ranking senior to or pari passu with the Series A Preferred
Stock.
(iii) The right of the holders of shares of
Series A Preferred Stock, voting separately as a class, to
elect two members of the Board of Directors of the
Corporation as aforesaid shall continue until, and only
until, such time as all arrears in dividends (whether or not
declared) on the Series A Preferred Stock shall have been
paid or declared and set apart for payment, at which time
such right shall terminate, except as herein or by law
expressly provided subject to revesting in the event of each
and every subsequent default of the character
above-mentioned. Upon any termination of the right of the
holders of the Series A Preferred Stock as a class to vote
for directors as herein provided, the term of office of all
directors then in office elected by the holders of shares of
Series A Preferred Stock pursuant to this Section shall
terminate immediately. Whenever the term of office of the
directors elected by the holders of shares of Series A
Preferred Stock pursuant to this Section shall terminate and
the special voting powers vested in the holders of the
Series A Preferred Stock pursuant to this Section shall have
expired, the maximum number of members of this Board of
Directors of the Corporation shall be such number as may be
provided for in the By-laws of the Corporation, irrespective
of any increase made pursuant to the provisions of this
Section.
(D) Except as otherwise required by applicable law or as
set forth herein, holders of Series A Preferred Stock shall have
no special voting rights and their consent shall not be required
(except to the extent they are entitled to vote with holders of
shares of common stock as set forth herein) for taking any
corporate action.
Section 4. Certain Restrictions.
(A) Whenever dividends or distributions payable on the
Series A Preferred Stock as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A
Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
<PAGE>
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise
acquire for consideration any shares of stock ranking
junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred
Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a
parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series A Preferred
Stock, except dividends paid ratably on the Series A
Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to
the total amounts to which the holders of all such
shares are then entitled;
(iii) except as permitted in subsection 4(A)(iv) below,
redeem, purchase or otherwise acquire for consideration
shares of any stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding
up) with the Series A Preferred Stock, provided that
the Corporation may at any time redeem, purchase or
otherwise acquire shares of any such parity stock in
exchange for shares of any stock of the Corporation
ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A
Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of
any stock ranking on a parity (either as to dividends
or upon liquidation, dissolution or winding up) with
the Series A Preferred Stock, except in accordance with
a purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of
such shares upon such terms as the Board of Directors,
after consideration of the respective annual dividend
rates and other relative rights and preferences of the
respective series and classes, shall determine in good
faith will result in fair and equitable treatment among
the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration
any shares of stock of the Corporation unless the Corporation
could, under subsection (A) of this Section 4, purchase or
otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A
Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired and
cancelled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but
unissued shares of preferred stock and may be reissued as part of
a new series of preferred stock to be created by resolution or
resolutions of the Board of Directors, subject to the conditions
and restrictions on issuance set forth herein.
<PAGE>
Section 6. Liquidation, Dissolution or Winding Up. Upon
any liquidation (voluntary or otherwise), dissolution or winding
up of the Corporation, no distribution shall be made (x) to the
holders of shares of stock ranking junior (either as to dividends
or upon liquidation, dissolution or winding up) to the Series A
Preferred Stock unless, prior thereto, the holders of shares of
Series A Preferred Stock shall have received an amount equal to
accrued and unpaid dividends and distributions thereon, whether
or not declared, to the date of such payment, plus an amount
equal to the greater of (1) $1,000.00 per share or (2) an
aggregate amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 1,000 times the
aggregate amount to be distributed per share to holders of shares
of common stock, or (y) to the holders of stock ranking on a
parity (either as to dividends or upon liquidation, dissolution
or winding up) with the Series A Preferred Stock, except
distributions made ratably on the Series A Preferred Stock and
all other such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. In the event the
Corporation shall at any time after the Rights Declaration Date
(i) declare or pay any dividend on shares of common stock payable
in shares of common stock, or (ii) effect a subdivision or
combination or consolidation of the outstanding shares of common
stock (by reclassification or otherwise than by payment of a
dividend in shares of common stock) into a greater or lesser
number of shares of common stock, then in each such case the
aggregate amount per share to which holders of Series A Preferred
Stock were entitled immediately prior to such event under clause
(x) of the preceding sentence shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number
of shares of common stock outstanding immediately after such
event and the denominator of which is the number of shares of
common stock that were outstanding immediately prior to such
event.
Neither the consolidation of nor merging of the Corporation
with or into any other corporation or corporations, nor the sale
or other transfer of all or substantially all of the assets of
the Corporation, shall be deemed to be a liquidation, dissolution
or winding up of the Corporation within the meaning of this
Section 6.
Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of common
stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case
the shares of Series A Preferred Stock shall at the same time be
similarly exchanged or changed in an amount per share (subject to
the provision for adjustment hereinafter set forth) equal to
1,000 times the aggregate amount of stock, securities, cash
and/or any other property (payable in kind), as the case may be,
into which or for which each common share is changed or
exchanged, plus accrued and unpaid dividends, if any, payable
with respect to the Series A Preferred Stock. In the event the
Corporation shall at any time after the Rights Declaration Date
<PAGE>
(i) declare or pay any dividend on shares of common stock payable
in shares of common stock, or (ii) effect a subdivision or
combination or consolidation of the outstanding shares of common
stock (by reclassification or otherwise than by payment of a
dividend in shares of common stock) into a greater or lesser
number of shares of common stock, then in each such case the
amount set forth in the preceding sentence with respect to the
exchange or change of Series A Preferred Stock shall be adjusted
by multiplying such amount by a fraction, the numerator of which
is the number of shares of common stock outstanding immediately
after such event and the denominator of which is the number of
shares of common stock that were outstanding immediately prior to
such event.
Section 8. Redemption. The shares of Series A Preferred
Stock shall not be redeemable; provided, however, that the
foregoing shall not limit the ability of the Corporation to
purchase or otherwise deal in such shares to the extent otherwise
permitted hereby and by law.
Section 9. Ranking. Unless otherwise provided in the
Articles of Incorporation or Articles Supplementary relating to a
subsequently-designated series of preferred stock of the
Corporation, the Series A Preferred Stock shall rank junior to
any other series of the Corporation's preferred stock
subsequently issued, as to the payment of dividends and the
distribution of assets on liquidation, dissolution or winding up
and shall rank senior to the common stock.
Section 10. Amendment. Neither these Articles
Supplementary nor the Articles of Incorporation of the
Corporation may be amended in any manner which would materially
alter or change the powers, preferences or special rights of the
Series A Preferred Stock so as to affect them adversely without
the affirmative vote of the holders of a majority or more of the
outstanding shares of Series A Preferred Stock, voting separately
as a class.
Section 11. Fractional Shares. Shares of Series A
Preferred Stock may be issued in whole shares or in any fraction
of a share that is one ten-thousandth (1/1,000th) of a share or
any integral multiple of such fraction, which shall entitle the
holder, in proportion to such holder's fractional shares, to
exercise voting rights, receive dividends, participate in
distributions and to have the benefit of all other rights of
holders of shares of Series A Preferred Stock. In lieu of
fractional shares, the Corporation may elect to make a cash
payment as provided in the Rights Agreement for fractions of a
share other than one ten-thousandth (1/1,000th) of a share or any
integral multiple thereof."
<PAGE>
IN WITNESS WHEREOF, these Articles Supplementary have been
executed on behalf of the Corporation by its President and
attested by its Secretary this ___ day of November, 1996.
SOVRAN SELF STORAGE, INC.
By:
Kenneth F. Myszka
President
(SEAL)
ATTEST:
By:
David L. Rogers
Secretary
<PAGE>
Exhibit B
[Form of Right Certificate]
Certificate No. R- Rights
NOT EXERCISABLE AFTER NOVEMBER 27, 2006 OR EARLIER IF NOTICE OF
REDEMPTION IS GIVEN. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT
THE OPTION OF SOVRAN SELF STORAGE, INC., AT $0.01 PER RIGHT ON
THE TERMS SET FORTH IN THE SHAREHOLDER RIGHTS AGREEMENT BETWEEN
SOVRAN SELF STORAGE, INC. AND AMERICAN STOCK TRANSFER AND TRUST
COMPANY, AS RIGHTS AGENT, DATED AS OF NOVEMBER 27, 1996 (THE
"RIGHTS AGREEMENT"). UNDER CERTAIN CIRCUMSTANCES SPECIFIED IN
SECTION 7(e) OF THE RIGHTS AGREEMENT, RIGHTS BENEFICIALLY OWNED
BY AN ACQUIRING PERSON OR AN ASSOCIATE OR AFFILIATE OF AN
ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME
NULL AND VOID.
Right Certificate
SOVRAN SELF STORAGE, INC.
This certifies that , or
registered assigns, is the registered owner of the number of
Rights set forth above, each of which entitles the owner thereof,
subject to the terms, provisions and conditions of the
Shareholder Rights Agreement dated as of November 27, 1996 (the
"Rights Agreement") between SOVRAN SELF STORAGE, INC. (the
"Company") and AMERICAN STOCK TRANSFER AND TRUST COMPANY, as
Rights Agent (the "Rights Agent"), to purchase from the Company
at any time after the Distribution Date (as such term is defined
in the Rights Agreement) and prior to the close of business on
November 27, 2006 at the office or offices of the Rights Agent
designated for such purpose, or its successors as Rights Agent,
one one-thousandth of a fully paid, non-assessable share of
Series A Junior Participating Cumulative Preferred Stock (the
"Preferred Stock") of the Company, at a purchase price of
$_______ per one one-thousandth of a share (the "Exercise
Price"), upon presentation and surrender of this Right
Certificate with the Form of Election to Purchase and the related
Certificate duly executed. The number of Rights evidenced by
this Right Certificate (and the number of shares which may be
purchased upon exercise thereof) set forth above, and the
Exercise Price per share set forth above, are the number and
Exercise Price as of , based on the shares of
Preferred Stock as constituted at such date.
<PAGE>
Upon the occurrence of a Section 11(a)(ii) Event (as such
term is defined in the Rights Agreement), if the Rights evidenced
by this Right Certificate are beneficially owned by (i) an
Acquiring Person or an Affiliate or Associate of any such Person
(as such terms are defined in the Rights Agreement), (ii) a
transferee of any such Acquiring Person, Associate or Affiliate,
or (iii) under certain circumstances specified in the Rights
Agreement, a transferee of a Person who, after such transfer,
became an Acquiring Person or an Affiliate or Associate of an
Acquiring Person, such Rights shall become null and void and no
holder hereof shall have any right with respect to such Rights
from and after the occurrence of such Section 11(a)(ii) Event.
As provided in the Rights Agreement, the Exercise Price and
the number of shares of Preferred Stock or other securities which
may be purchased upon the exercise of the Rights evidenced by
this Right Certificate are subject to modification and adjustment
upon the happening of certain events.
This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities
hereunder of the Rights Agent, the Company and the holders of the
Right Certificates, which limitations of rights include the
temporary suspension of the exercisability of such Rights under
the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the principal
office of the Company and the designated office of the Rights
Agent and are also available upon written request to the Company
or the Rights Agent.
This Right Certificate, with or without other Right
Certificates, upon surrender at the office or offices of the
Rights Agent designated for such purpose, may be exchanged for
another Right Certificate or Certificates of like tenor and date
evidencing Rights entitling the holder to purchase a like
aggregate number of shares of Preferred Stock as the Rights
evidenced by the Right Certificate or Certificates surrendered
shall have entitled such holder to purchase. If this Right
Certificate shall be exercised in part, the holder shall be
entitled to receive upon surrender hereof another Right
Certificate or Certificates for the number of whole Rights not
exercised. If this Right Certificate shall be exercised in whole
or in part pursuant to Section 11(a)(ii) of the Rights Agreement,
the holder shall be entitled to receive this Right Certificate
duly marked to indicate that such exercise has occurred as set
forth in the Rights Agreement.
Under certain circumstances, subject to the provisions of
the Rights Agreement, the Board of Directors of the Company at
its option may exchange all or any part of the Rights evidenced
by this Certificate for the Company's Common Stock or Preferred
Stock at an exchange ratio (subject to adjustment) of one Common
Share or one one-thousandth of a Preferred Share per Right.
<PAGE>
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate may be redeemed by the Board
of Directors of the Company at its option at a redemption price
of $0.01 per Right (payable in cash, Common Shares or other
consideration deemed appropriate by the Board of Directors).
The Company is not obligated to issue fractional shares of
stock upon the exercise of any Right or Rights evidenced hereby
(other than fractions which are integral multiples of one one-
thousandth of a Preferred Share, which may, at the election of
the Company, be evidenced by depositary receipts). If the
Company elects not to issue such fractional shares, in lieu
thereof a cash payment will be made, as provided in the Rights
Agreement.
No holder of this Right Certificate, as such, shall be
entitled to vote or receive dividends or be deemed for any
purpose the holder of Preferred Stock, Common Stock or any other
securities of the Company which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder
hereof, as such, any of the rights of a stockholder of the
Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting
stockholders (except as provided in the Rights Agreement), or to
receive dividends or subscription rights, or otherwise, until the
Right or Rights evidenced by this Right Certificate shall have
been exercised as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by an
authorized signatory of the Rights Agent.
<PAGE>
WITNESS the facsimile signature of the proper officers of
the Company and its corporate seal.
[Corporate Seal] SOVRAN SELF STORAGE, INC.
Attested: By___________________________
Name:
By__________________________________ Title: [Chairman, Vice
[Secretary or Assistant Secretary] Chairman, President
or Vice President]
Countersigned:
[____________________________],
as Rights Agent
____________________________________
Authorized Signatory
Date of countersignature:
<PAGE>
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR VALUE RECEIVED _____________ hereby sells, assigns and
transfers unto __________________________ (Please print name and
address of transferee) __________________________ this Right
Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint _____________
Attorney, to transfer the within Right Certificate on the books
of the within-named Company, with full power of substitution.
Dated:____________________
___________________________________
Signature
Signature Guaranteed:_________________________
<PAGE>
CERTIFICATE
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Right Certificate
are are not being 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
Rights Agreement); and
(2) after due inquiry and to the best knowledge of the
undersigned, the undersigned did did not directly or
indirectly acquire the Rights evidenced by this Right Certificate
from any Person who is, was or became an Acquiring Person or an
Affiliate or Associate of any such Person.
Dated:__________________ ________________________________
Signature
<PAGE>
NOTICE
The signature to the foregoing Assignment and Certificate
must correspond to the name as written upon the face of this
Right Certificate in every particular, without alteration or
enlargement or any change whatsoever.
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise the Right Certificate.)
To SOVRAN SELF STORAGE, INC.:
The undersigned hereby irrevocably elects to exercise
Rights represented by this Right Certificate to purchase the
shares of Preferred Stock issuable upon the exercise of the
Rights (or such other securities of the Company or of any other
person which may be issuable upon the exercise of the Rights) and
requests that certificates for such shares be issued in the name
of:
Please insert social security
or other identifying taxpayer number: _______________
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
If such number of Rights shall not be all the Rights
evidenced by this Right Certificate or if the Rights are being
exercised pursuant to Section 11(a)(ii) of the Rights Agreement,
a new Right Certificate for the balance of such Rights shall be
registered in the name of and delivered to:
Please insert social security
or other identifying taxpayer number: _________________
_________________________________________________________________
(Please print name and address)
_________________________________________________________________
_________________________________________________________________
Dated: ________________
_____________________________
Signature
Signature Guaranteed:________________________
<PAGE>
CERTIFICATE
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Right Certificate
are are not being exercised by or on behalf of a Person
who is or was an Acquiring Person or an Affiliate or Associate of
any such Person (as such terms are defined in the Rights
Agreement); and
(2) after due inquiry and to the best knowledge of the
undersigned, the undersigned did did not directly or
indirectly acquire the Rights evidenced by this Right Certificate
from any Person who is, was or became an Acquiring Person or an
Affiliate or Associate of any such Person.
Dated:___________________ ______________________________
Signature
<PAGE>
NOTICE
The signature to the foregoing Election to Purchase and
Certificate must correspond to the name as written upon the face
of this Right Certificate in every particular, without alteration
or enlargement or any change whatsoever.
<PAGE>
