1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A/A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
FORCENERGY INC
(Exact name of registrant as specified in its charter)
Delaware 65-0429338
(State of Incorporation (I.R.S. Employer
or organization) Identification Number)
2730 SW 3rd Avenue
Miami, Florida 33129
(Address of principal executive offices) (Zip code)
Securities to be registered pursuant to Section 12(b) of the
Act:
Rights to Purchase Junior Participating Preferred Stock, par
value $.01 per share
Title of Class
Securities to be registered pursuant to Section 12(g) of the
Act: None
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
1 Rights Agreement, dated as of May 27, 1997, between
the Company and American Stock Transfer and Trust
Company, as Rights Agent, specifying the terms of
the Rights, which includes the form of Certificate
of Designation of Junior Participating Preferred
Stock as Exhibit A, the form of Right Certificate as
Exhibit B and the form of the Summary of Rights to
Purchase Preferred Shares and Bylaw Provision
Relating to Nominations and Stockholder Proposals as
Exhibit C.
2 Form of Certificate of Designation of Junior
Participating Preferred Stock (included as Exhibit A
to the Rights Agreement filed as Exhibit 1 hereto)
setting forth the terms of the Junior Participating
Preferred Stock, par value $.01 per share.
3 Form of Right Certificate (included as Exhibit B to
the Rights Agreement filed as Exhibit 1 hereto).
Pursuant to the Rights Agreement, printed Right
Certificates will not be delivered until as soon as
practicable after the Distribution Date.
4 Form of Summary of Rights to Purchase Preferred
Shares and Bylaw Provision Relating to Nominations
and Stockholder Proposals (included as Exhibit C to
the Rights Agreement filed as Exhibit 1 hereto)
which, together with certificates representing the
outstanding Common Shares of the Company, shall
represent the Rights prior to the Distribution Date.
<PAGE>
Exhibit 1
Rights Agreement
between
FORCENERGY INC
and
AMERICAN STOCK TRANSFER & TRUST COMPANY
as Rights Agent
Dated as of November 26, 1997
TABLE OF CONTENTS
Page
Section 1. Certain Definitions 1
Section 2. Appointment of Rights Agent 6
Section 3. Issue of Right Certificates 7
Section 4. Form of Right Certificates 8
Section 5. Execution, Authentication and Delivery 9
Section 6. Registration, Registration of Transfer
and Exchange 10
Section 7. Mutilated, Destroyed, Lost and Stolen
Right Certificates 10
Section 8. Exercise of Rights; Purchase Price;
Expiration Date of Rights 11
Section 9. Cancellation and Destruction of Right
Certificates 12
Section 10. Reservation and Availability of Shares 12
Section 11. Record Date 13
Section 12. Adjustment of Purchase Price, Number of
Shares or Number of Rights 13
Section 13. Certificate of Adjusted Purchase Price
or Number of Shares 19
Section 14. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power 19
Section 15. Fractional Rights and Fractional Shares 20
Section 16. Rights of Action 21
Section 17. Agreement of Right Holders 22
<PAGE>
Section 18. Right Certificate Holder Not Deemed a
Stockholder 22
Section 19. Concerning the Rights Agent 23
Section 20. Duties of Rights Agent 23
Section 21. Merger or Consolidation or Change of
Name of Rights Agent 25
Section 22. Change of Rights Agent 25
Section 23. Issuance of New Right Certificates 26
Section 24. Redemption 26
Section 25. Mandatory Redemption and Exchange 27
Section 26. Notice of Certain Events 28
Section 27. Securities Laws Registrations 29
Section 28. Notices 29
Section 29. Supplements and Amendments 30
Section 30. Successors 30
Section 31. Benefits of this Agreement 30
Section 32. Severability 30
Section 33. Governing Law 30
Section 34. Counterparts 31
Section 35. Descriptive Headings 31
<PAGE>
Exhibits
- --------
Exhibit A - Certificate of Designation of Preferred Shares
Exhibit B - Right Certificate
Exhibit C - Summary of Rights
<PAGE>
RIGHTS AGREEMENT
This Rights Agreement, dated as of November 26, 1997,
is between Forcenergy Inc, a Delaware corporation (the
"Company"), and American Stock Transfer & Trust Company, as
Rights Agent.
WHEREAS, the Board of Directors of the Company, having
determined its actions to be in the interests of the
Company, has authorized the creation of Rights, has
authorized and directed the issuance to the Holders of
record of Common Shares of the Company outstanding on
December 10, 1997 of one Right with respect to each Common
Share of the Company outstanding on December 10, 1997, and
has further authorized and directed the issuance of one
Right with respect to each Common Share that shall become
outstanding between December 10, 1997 and the earlier of the
Distribution Date, the Redemption Date and the Final
Expiration Date; and
WHEREAS, the Board of Directors of the Company has
authorized and directed that the terms and conditions under
which the Rights are to be distributed, including without
limitation those affecting the exercise thereof, the securi-
ties or other property to be acquired thereby and the
purchase price to be paid therefor, shall be set forth in a
written agreement between the Company and a rights agent
made for the benefit of the holders of the Rights to the
extent so provided therein.
NOW, THEREFORE, in consideration of the premises and
the mutual agreements herein set forth, the parties hereto
agree as follows:
Section 1. Certain Definitions. For purposes of this
Agreement, the following terms shall have the meanings
indicated:
"Acquiring Person" shall mean any Person who or
which, together with all Affiliates and Associates of
such Person, shall be the Beneficial Owner of 20% or
more of the Voting Shares of the Company then
outstanding, but shall not include the Company, any
Subsidiary of the Company, any employee benefit plan of
the Company or of any Subsidiary of the Company or any
trustee of or fiduciary with respect to any such plan
when acting in such capacity. Notwithstanding the
foregoing, (i) no Person shall become an "Acquiring
Person" as the result of an acquisition of Voting
Shares by the Company which, by reducing the number of
shares outstanding, increases the proportionate number
of shares beneficially owned by such Person to 20% or
more of the Voting Shares of the Company then
outstanding; provided, however, that, if a Person shall
become the Beneficial Owner of 20% or more of the
Voting Shares of the Company then outstanding by reason
of share purchases by the Company and shall, after such
share purchases by the Company and at a time when such
Person is the Beneficial Owner of 20% or more of the
Voting Shares of the Company then outstanding, become
the Beneficial Owner of any additional Voting Shares of
the Company, then such Person shall be deemed to be an
"Acquiring Person"; (ii) Forcenergy AB or a Successor
Entity shall not be deemed to be an "Acquiring Person"
as the result of its ownership at any time of more than
20% of the outstanding Voting Shares of the Company;
and (iii) if the Board of Directors of the Company
determines in good faith that a Person who would
otherwise be an "Acquiring Person," as defined pursuant
to the foregoing provisions of this paragraph (a), has
become such inadvertently, and such Person divests as
promptly as practicable a sufficient number of Common
Shares so that such Person would no longer be an
"Acquiring Person," as defined pursuant to the
foregoing provisions of this paragraph (a), then such
Person shall not be deemed to be an "Acquiring Person"
for any purposes of this Agreement.
"Agreement" shall mean this Rights Agreement as
hereafter amended from time to time.
"Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in
Rule 12b-2 of the General Rules and Regulations under
the Exchange Act as in effect on the date of this
Agreement.
A Person shall be deemed the "Beneficial Owner" of
and shall be deemed to "own beneficially" any
securities which (without duplication):
(i) such Person or any of such Person's
Affiliates or Associates beneficially owns,
directly or indirectly, within the meaning of
either Section 13 or 16 of the Exchange Act;
(ii) such Person or any of such Person's
Affiliates or Associates has (A) the right to
acquire (whether such right is exercisable
immediately or only after the passage of time)
pursuant to any agreement, arrangement or
understanding (other than customary agreements
with and between underwriters and selling group
members with respect to a bona fide public
offering of securities), or upon the exercise of
conversion rights, exchange rights, rights (other
than these Rights), warrants or options, or
otherwise; or (B) the right to vote pursuant to
any agreement, arrangement or understanding; or
(iii) are beneficially owned, directly or
indirectly, by any other Person with which such
Person or any of such Person's Affiliates or
Associates has any agreement, arrangement or
understanding (other than customary agreements
with and between underwriters and selling group
members with respect to a bona fide public
offering of securities) for the purpose of
acquiring, holding, voting or disposing of any
securities of the Company; provided, however,
that, for purposes of each clause of this
definition, a Person shall not be deemed the
Beneficial Owner of, or to own beneficially,
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; and provided, further, that,
for purposes of each clause of this definition, a
Person shall not be deemed the Beneficial Owner
of, or to own beneficially, any security as a
result of any agreement, arrangement or
understanding to vote such security if such
agreement, arrangement or understanding (1) arises
solely from a revocable proxy or consent given to
such Person in response to a public proxy or
consent solicitation made pursuant to, and in
accordance with, the applicable rules and
regulations promulgated under the Exchange Act and
(2) is not also then reportable on Schedule 13D
under the Exchange Act (or any comparable or
successor report).
Notwithstanding anything in this definition to the
contrary, the phrase "then outstanding," when used with
reference to a Person's Beneficial Ownership of
securities of the Company (or to the number of such
securities "beneficially owned"), shall mean the number
of such securities then issued and outstanding together
with the number of such securities not then actually
issued and outstanding which such Person would be
deemed to own beneficially hereunder.
"Business Day" shall mean any day other than a
Saturday, Sunday or a day on which banking institutions
in the State of New York are authorized or obligated by
law or executive order to close.
"Close of Business" on any given date shall mean
5:00 p.m., New York City time, on such date; provided,
however, that if such date is not a Business Day it
shall mean 5:00 p.m., New York City time, on the next
succeeding Business Day.
"Closing Price," with respect to any security,
shall mean the last sale price, regular way, on a
specific Trading Day or, in case no such sale takes
place on such Trading 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 such security is not then 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 such security is
not then listed or admitted to trading on any national
securities exchange, the last quoted price or, if not
so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by
the National Association of Securities Dealers, Inc.
Automated Quotations System or such other system then
in use, or, if on any such Trading Day such security is
not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a
professional market maker making a market in such
security selected by the Board of Directors of the
Company. If such security is not publicly held or so
listed or traded, "Closing Price" shall mean the fair
value per unit of such security as determined in good
faith by the Board of Directors of the Company, whose
determination shall be described and the Closing Price
set forth in a statement filed with the Rights Agent.
"Common Shares" when used with reference to the
Company shall mean shares of capital stock of the
Company which have no preference over any other class
of stock with respect to dividends or assets, which are
not redeemable at the option of the Company and with
respect to which no sinking, purchase or similar fund
is provided and shall initially mean the shares of
Common Stock, par value $.01, of the Company. "Common
Shares" when used with reference to any Person other
than the Company shall, if used with reference to a
corporation, mean the capital stock (or equity interest)
with the greatest voting power of such other
Person or, if such other Person is a Subsidiary of
another Person, the Person or Persons which ultimately
control such first-mentioned Person and, if used with
reference to any other Person, mean the equity interest
in such Person (or, if the net worth determined in
accordance with generally accepted accounting
principles of another Person (other than an individual)
which controls such first-mentioned Person is greater
than such first-mentioned Person, then such other
Person) with the greatest voting power or managerial
power with respect to the business and affairs of such
Person.
"Company" shall mean Forcenergy Inc, a Delaware
corporation, and its successors.
"Company Order" means a written request or order
signed in the name of the Company by its Chairman of
the Board, its President or a Vice President, and by
its Treasurer, an Assistant Treasurer, its Secretary or
an Assistant Secretary, and delivered to the Rights
Agent.
"Corporate Trust Office" means the principal
office of the Rights Agent at which it administers its
corporate trust business, which, in the case of
American Stock Transfer & Trust Company shall, until
hereafter changed, be its office at 40 Wall Street, New
York, New York 10005.
"Distribution Date" shall mean the earlier of (i)
the tenth Business Day after the Shares Acquisition
Date or (ii) the tenth Business Day (or such later date
as may be determined by action of the Board of
Directors prior to such time as any Person becomes an
Acquiring Person) after the date of commencement by any
Person (other than the Company, any Subsidiary of the
Company, any employee benefit plan of the Company or of
any Subsidiary of the Company, or any trustee of or
fiduciary with respect to any such plan when acting in
such capacity) of, or after the date of the first
public announcement of the intent of any Person (other
than the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or of any
Subsidiary of the Company, or any trustee of or
fiduciary with respect to any such plan when acting in
such capacity) to commence, a tender or exchange offer
the consummation of which would result in any Person
becoming the Beneficial Owner of 20% or more of the
then outstanding Voting Shares of the Company;
provided, however, that an occurrence described in
clause (ii) of this definition above shall not cause
the occurrence of the Distribution Date if the Board of
Directors of the Company shall, prior to such tenth
Business Day (or such later date as described in clause
(ii) above), determine that such tender or exchange
offer is spurious, unless, thereafter, the Board of
Directors of the Company shall make a contrary
determination, in which event the Distribution Date
shall occur on the later to occur of such tenth
Business Day (or such later date as described in clause
(ii) above) and the date of such latter determination.
"Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended, and any successor statute
thereto.
"Final Expiration Date" shall mean the Close of
Business on December 10, 2007.
"Forcenergy AB" shall mean Forcenergy AB, a
Swedish corporation, and its successors and assigns.
"Person" shall mean any individual, firm,
corporation, partnership, limited partnership, limited
liability company, trust or other entity, and shall
include any successor (by merger or otherwise) of such
entity.
"Preferred Shares" shall mean shares of Series A
Junior Participating Preferred Stock, par value $.01
per share, of the Company having the rights and
preferences set forth in the form of Certificate of
Designation of Series A Junior Participating Preferred
Stock attached hereto as Exhibit A.
"Purchase Price" shall mean the initial price at
which the holder of a Right may, subject to the terms
and conditions of this Agreement, purchase one
one-thousandth (1/1000) of a Preferred Share (which
initial price is set forth in Section 8(b) hereof), as
such price shall be adjusted pursuant to the terms of
this Agreement.
"Redemption Date" shall mean the time at which the
Rights are redeemed pursuant to Section 24 herein or
the time at which all of the Rights are mandatorily
redeemed and exchanged pursuant to Section 25 hereof.
"Redemption Price" shall have the meaning
specified in Section 24(b) herein.
"Right" shall mean one preferred share purchase
right which initially represents the right of the
registered holder thereof to purchase one
one-thousandth (1/1000) of a Preferred Share upon the
terms and subject to the conditions herein set forth.
"Right Certificate" shall mean a certificate, in
substantially the form of Exhibit B attached to this
Rights Agreement, evidencing the Rights registered in
the name of the holder thereof.
"Rights Agent" shall mean American Stock Transfer
& Trust Company, a New York trust company, and any
successor thereto appointed in accordance with the
terms hereof, in its capacity as agent for the Company
and the holders of the Rights pursuant to this
Agreement.
"Rights Register" and "Rights Registrar" shall
have the meanings specified in Section 6.
"Shares Acquisition Date" shall mean the first
date of public announcement (which for purposes of this
definition shall include without limitation a report
filed pursuant to Section 13(d) or Section 16(a) of the
Exchange Act) by the Company or an Acquiring Person
that an Acquiring Person has become such.
"Subsidiary" of any Person shall mean any
corporation or other entity of which a majority of the
outstanding capital stock or other equity interests
having ordinary voting power in the election of
directors or similar officials is owned, directly or
indirectly, by such Person.
"Successor Entity" shall mean any Person who
acquires, directly or indirectly, any Voting Shares of
the Company from Forcenergy AB other than in a public
offering.
"Summary of Rights" shall mean a Summary of Rights
to Purchase Preferred Shares in substantially the form
attached as Exhibit C to this Agreement.
"Trading Day" shall mean a day on which the
principal national securities exchange or the NASDAQ
National Market on which any of the Voting Shares of
the Company are listed or admitted to trading is open
for the transaction of business or, if none of the
Voting Shares of the Company is listed or admitted to
trading on any national stock exchange or the NASDAQ
National Market, a Business Day.
"Voting Shares" shall mean (i) the Common Shares
of the Company and (ii) any other shares of capital
stock of the Company entitled to vote generally in the
election of directors or entitled to vote together with
the Common Shares in respect of any merger or
consolidation of the Company, any sale of all or
substantially all of the Company's assets or any
liquidation, dissolution or winding up of the Company.
Whenever any provision of this Agreement requires a
determination of whether a number of Voting Shares
comprising a specified percentage of such Voting Shares
is, was or will be beneficially owned or has been
voted, tendered, acquired, sold or otherwise disposed
of or a determination of whether a Person has offered
or proposed to acquire a number of Voting Shares
comprising such specified percentage, the number of
Voting Shares comprising such specified percentage of
Voting Shares shall in every such case be deemed to be
the number of Voting Shares comprising the specified
percentage of all the Company's then outstanding Voting
Shares.
"Wholly-Owned Subsidiary" of a Person shall mean
any corporation or other entity all the outstanding
capital stock or other equity interests of which having
ordinary voting power in the election of directors or
similar officials (other than directors' qualifying
shares or similar interests) are owned, directly or
indirectly, by such Person.
Section 2. Appointment of Rights Agent. The Company
hereby appoints the Rights Agent to act as agent for the
Company and the holders of the Rights (who, in accordance
with Section 3 hereof, shall prior to the Distribution Date
also be the holders of the Common Shares 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.
Section 3. Issue of Right Certificates. (a) From and
after December 10, 1997 until the Distribution Date, (i) out
standing Rights will be evidenced (subject to the provisions
of paragraph (b) of this Section 3) by the certificates for
outstanding Common Shares of the Company and not by separate
Right Certificates, and (ii) the right to receive Right
Certificates will be transferable only in connection with
the transfer of Common Shares of the Company. As soon as
practicable after the Distribution Date, the Rights Agent
will send, by first-class, insured, postage-prepaid mail, to
each record holder of Common Shares of the Company as of the
Close of Business on the Distribution Date, at the address
of such holder shown on the stock transfer records of the
Company, a Right Certificate evidencing one Right for each
Common Share so held. From and after the Distribution Date,
The Rights will be evidenced solely by such Right Certifi-
cates.
(b) On December 17, 1997, or as soon thereafter as
practicable, the Company will send a copy of a Summary of
Rights, by first-class, postage-prepaid mail, to each record
holder of Common Shares of the Company as of the Close of
Business on December 10, 1997, at the address of such holder
shown on the stock transfer records of the Company. With
respect to Common Shares outstanding on December 10, 1997,
the certificates evidencing such Common Shares shall,
together with copies of such Summary of Rights, thereafter
also evidence the outstanding Rights (as such Rights may be
amended or supplemented) distributed with respect thereto
until the earlier of the Distribution Date or the date of
surrender thereof to the Company's transfer agent for
registration of transfer or exchange of Common Shares.
Until the Distribution Date (or, if earlier, the Redemption
Date or Final Expiration Date), the surrender for
registration of transfer or exchange of any certificate for
Common Shares outstanding as of the Close of Business on
December 10, 1997, with or without a copy of the Summary of
Rights attached thereto, shall also constitute the surrender
for registration of transfer or exchange of the outstanding
Rights associated with the Common Shares represented
thereby.
(c) The Company agrees that, at any time after
December 10, 1997 and prior to the Distribution Date (or, if
earlier, the Redemption Date or Final Expiration Date) at
which it issues any of its Common Shares upon original issue
or out of treasury, it will concurrently distribute to the
holder of such Common Shares one Right for each such Common
Share, which Right shall be subject to the terms and
provisions of this Agreement and will evidence the right to
purchase the same number of one one-thousandth (1/1000) of a
Preferred Share at the same Purchase Price as the Rights
then outstanding.
(d) Certificates for Common Shares issued after
December 10, 1997 but prior to the earliest of the Distribu-
tion Date, the Redemption Date and the Final Expiration
Date, whether upon registration of transfer or exchange of
Common Shares outstanding on December 10, 1997 or upon
original issue or out of treasury thereafter, shall have
impressed on, printed on, written on or otherwise affixed to
them the following legend:
This certificate also evidences and entitles
the holder hereof to certain Rights as set forth
in a Rights Agreement between Forcenergy Inc (the
"Company") and American Stock Transfer & Trust
Company (the "Rights Agent") dated as of November
26, 1997 (the "Rights Agreement"), the terms of
which are hereby incorporated herein by reference
and a copy of which is on file at the principal
executive offices of the Company. Under certain
circumstances, as set forth in the Rights Agree-
ment, such Rights will be evidenced by separate
certificates and will no longer be evidenced by
this certificate. The Company will mail to the
holder of this certificate a copy of the Rights
Agreement as in effect on the date of mailing
without charge after receipt of a written request
therefor.
Under certain circumstances set forth in the
Rights Agreement, Rights issued to, or held by,
any Person who is, was or becomes an Acquiring
Person or any Affiliate or Associate thereof (as
such terms are defined in the Rights Agreement),
whether currently held by or on behalf of such
Person or by any subsequent holder, may become
null and void. The Rights shall not be
exercisable, and shall be void so long as held, by
a holder in any jurisdiction where the requisite
qualification of 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 certificates containing the foregoing
legend, until the Distribution Date, outstanding Rights
associated with the Common Shares represented by such
certificates shall be evidenced by such certificates alone,
and the surrender of any such certificate for registration
of transfer or exchange of the Common Shares evidenced
thereby shall also constitute surrender for registration of
transfer or exchange of outstanding Rights (as such Rights
may be amended or supplemented) associated with the Common
Shares represented thereby.
(e) If the Company purchases or acquires any of its
Common Shares after December 10, 1997, but prior to the
Distribution Date, any Rights associated with such Common
Shares shall be deemed cancelled and retired so that the
Company shall not be entitled to exercise any Rights
associated with the Common Shares which are no longer
outstanding.
Section 4. Form of Right Certificates. The form of
Right Certificates (and the forms of election to purchase
Preferred Shares (or other securities) and of assignment to
be printed on the reverse thereof) shall in form and
substance be substantially the same as Exhibit B hereto and
may have such marks of identification or designation and
such legends, summaries or endorsements printed thereon as
the Company may deem appropriate and as are not inconsistent
with the provisions of this Agreement, as may be required to
comply with any applicable law or with any rule or
regulation made pursuant thereto or with any rule or regu-
lation of any stock exchange on which the Rights may from
time to time be listed or as may be necessary to conform to
usage. Subject to the provisions of Section 23 hereof, the
Right Certificates, whenever issued, shall be dated as of
the date of authentication thereof, but, regardless of any
adjustments of the Purchase Price or the number of Preferred
Shares (or other securities) as to which a Right is
exercisable (whether pursuant to this Agreement or any
future amendments or supplements to this Agreement), or
both, occurring after December 10, 1997 and prior to the
date of such authentication, such Right Certificates may, on
their face, without invalidating or otherwise affecting any
such adjustment, expressly entitle the holders thereof to
purchase such number of Preferred Shares at the Purchase
Price per one one-thousandth (1/1000) of a Preferred Share
as to which a Right would be exercisable if the Distribution
Date were December 10, 1997; no adjustment of the Purchase
Price or the number of Preferred Shares (or other
securities) as to which a Right is exercisable, or both,
effected subsequent to the date of authentication of any
Right Certificate shall be invalidated or otherwise affected
by the fact that such adjustment is not expressly reflected
on the face or in the provisions of such Right Certificate.
Pending the preparation of definitive Right Certifi-
cates, the Company may execute, and upon Company Order the
Rights Agent shall authenticate and send, by first-class,
insured, postage-prepaid mail, to each record holder of
Common Shares of the Company as of the Close of Business on
the Distribution Date, temporary Right Certificates which
are printed, lithographed, typewritten, mimeographed or
otherwise produced substantially of the tenor of the
definitive Right Certificates in lieu of which they are
issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing
such Right Certificates may determine, as evidenced by their
execution of such Right Certificates.
If temporary Right Certificates are issued, the Company
will cause definitive Right Certificates to be prepared
without unreasonable delay. After the preparation of
definitive Right Certificates, the temporary Right Certifi-
cates shall be exchangeable for definitive Right Certifi-
cates, upon surrender of the temporary Right Certificates at
the Corporate Trust Office of the Rights Agent, without
charge to the holder. Upon surrender for cancellation of
any one or more temporary Right Certificates, the Company
shall execute and the Rights Agent shall authenticate and
deliver in exchange therefor one or more definitive Right
Certificates, evidencing a like number of Rights. Until so
exchanged, the temporary Right Certificates shall in all
respects be entitled to the same benefits under this Agree-
ment as definitive Right Certificates.
Section 5. Execution, Authentication and Delivery.
The Right Certificates shall be executed on behalf of the
Company by its Chairman of the Board, its President or one
of its Vice Presidents, attested by its Secretary or one of
its Assistant Secretaries. The signature of any of these
officers on the Right Certificates may be manual or
facsimile.
Right Certificates bearing the manual or facsimile
signatures of individuals who were at any time the proper
officers of the Company shall bind the Company, notwith-
standing that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery
of such Right Certificates or did not hold such offices at
the date of authentication of such Right Certificates. At
any time and from time to time after the execution and
delivery of this Agreement and prior to the Distribution
Date, the Company may deliver Right Certificates executed by
the Company to the Rights Agent for authentication, together
with a Company Order for the authentication and delivery of
such Right Certificates; and the Rights Agent in accordance
with such Company Order shall authenticate and deliver such
Right Certificates as in this Agreement provided and not
otherwise.
No Right Certificate shall be entitled to any benefit
under this Agreement or be valid or obligatory for any
purpose unless there appears on such Right Certificate a
certificate of authentication substantially in the form
provided for herein executed by the Rights Agent by manual
signature, and such certificate upon any Right Certificate
shall be conclusive evidence, and the only evidence, that
such Right Certificate has been duly authenticated and
delivered hereunder.
Section 6. Registration, Registration of Transfer and
Exchange. From and after the Distribution Date and prior to
the earlier of the Redemption Date and the Final Expiration
Date, the Company shall cause to be kept at the Corporate
Trust Office of the Rights Agent a Rights Register (a
"Rights Register") in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide
for the registration of Right Certificates and of transfers
of Rights. The Rights Agent is hereby appointed the
registrar and transfer agent (the "Rights Registrar") for
the purpose of registering Right Certificates and transfers
of Rights as herein provided and the Rights Agent agrees to
maintain such Rights Register in accordance with such
regulations so long as it continues to be designated as
Rights Registrar hereunder.
Upon surrender to the Rights Agent for registration of
transfer of any Right Certificate, the Company shall exe
cute, and the Rights Agent shall authenticate and deliver,
in the name of the designated transferee or transferees, one
or more new Right Certificates evidencing a like number of
Rights.
At the option of the holder, Right Certificates may be
exchanged for other Right Certificates upon surrender of the
Right Certificates to be exchanged to the Rights Agent.
Whenever any Right Certificates are so surrendered for
exchange, the Company shall execute, and the Rights Agent
shall authenticate and deliver, the Right Certificates which
the holder making the exchange is entitled to receive.
All Right Certificates issued upon any registration of
transfer or exchange of Right Certificates shall be the
valid obligations of the Company, evidencing the same
Rights, and entitled to the same benefits under this Agree-
ment, as the Right Certificates surrendered upon such
registration of transfer or exchange.
Every Right Certificate presented or surrendered for
registration of transfer or exchange shall (if so required
by the Company or the Rights Agent) be duly endorsed, or
accompanied by a written instrument of transfer in form
satisfactory to the Company and the Rights Registrar duly
executed, by the holder thereof or his attorney duly
authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of Right Certificates, but the Company
may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Right
Certificates, other than exchanges not involving any trans-
fer.
The provisions of this Section 6 shall be subject to
the provisions of Section 15.
Section 7. Mutilated, Destroyed, Lost and Stolen Right
Certificates. If any mutilated Right Certificate is surrender-
ed to the Rights Agent, the Company shall execute and the
Rights Agent shall authenticate and deliver in exchange
therefor a new Right Certificate of like tenor, for a like
number of Rights and bearing a registration number not con
temporaneously outstanding.
If there shall be delivered to the Company and the
Rights Agent (i) evidence to their satisfaction of the
destruction, loss or theft of a Right Certificate and (ii)
such security or indemnity, if any, as may be required by
them to save each of them and any agent of either of them
harmless, then, in the absence of notice to the Company or
the Rights Agent that such Right Certificate has been
acquired by a bona fide purchaser, the Company shall execute
and upon its request the Rights Agent shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Right
Certificate, a new Right Certificate of like tenor, for a
like number of Rights and bearing a registration number not
contemporaneously outstanding.
Upon the issuance of any new Right Certificate under
this Section, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge
that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Rights
Agent) connected therewith.
Every new Right Certificate issued pursuant to this
Section in lieu of any destroyed, lost or stolen Right
Certificate shall constitute an additional contractual
obligation of the Company, whether or not the destroyed,
lost or stolen Right Certificate shall be at any time
enforceable by anyone, and shall be entitled to all the
benefits of this Agreement equally and proportionately with
any and all other Right Certificates duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of muti-
lated, destroyed, lost or stolen Right Certificates.
Section 8. Exercise of Rights; Purchase Price; Expira-
tion Date of Rights. (a) The registered holder of any Right
Certificate may exercise the Rights evidenced thereby
(except as otherwise provided herein) in whole or in part at
any time after the Distribution Date upon surrender of the
Right Certificate, with the form of election to purchase on
the reverse side thereof duly executed, to the Rights Agent
at its Corporate Trust Office, together with payment of the
Purchase Price for each one one-thousandth (1/1000) of a
Preferred Share (or other securities) as to which the Rights
are exercised, at or prior to the earliest of (i) the Close
of Business on the Final Expiration Date, (ii) the time of
redemption on the Redemption Date or (iii) the time at which
such Rights are mandatorily redeemed and exchanged as
provided in Section 25 hereof.
(b) The Purchase Price for each one one-thousandth
(1/1000) of a Preferred Share pursuant to the exercise of a
Right shall initially be Two Hundred Dollars ($200.00),
shall be subject to adjustment from time to time as provided
in Sections 12 and 14 hereof and shall be payable in lawful
money of the United States of America in accordance with
paragraph (c) below.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase
duly executed, accompanied by payment of the Purchase Price
for the securities to be purchased and an amount equal to
any applicable transfer tax required to be paid by the
holder of such Right Certificate in accordance with
Section 10 in cash, or by certified check or cashier's check
payable to the order of the Company, the Rights Agent shall
thereupon promptly (i) (A) requisition from any transfer
agent of the Preferred Shares (or other securities)
certificates for such number of one one-thousandth of a
Preferred Share (or other securities) as are to be purchased
and registered in such name or names as may be designated by
the registered holder of such Right Certificate or, if
appropriate, in the name of a depositary agent or its
nominee, and the Company hereby irrevocably authorizes its
transfer agent to comply with all such requests, and (B)
requisition from a depositary agent appointed by the
Company, if any, depositary receipts representing such
number of one one-thousandth of a Preferred Share as are to
be purchased and registered in such name or names as may be
designated by such holder (in which case certificates for
the Preferred Shares represented by such receipts shall be
deposited by the transfer agent with such depositary agent),
and the Company hereby directs such depositary agent to
comply with all such requests, (ii) when appropriate,
requisition from the Company the amount of cash to be paid
in lieu of issuance of fractional shares in accordance with
Section 15, (iii) promptly after receipt of such certifi-
cates or depositary receipts registered in such name or
names as may be designated by such holder, cause the same to
be delivered to or upon the order of the registered holder
of such Right Certificate and (iv) when appropriate, after
receipt, promptly deliver such cash to or upon the order of
such holder.
(d) If the registered holder of the Right Certificate
shall exercise less than all the Rights evidenced thereby, a
new Right Certificate evidencing Rights equal to the Rights
remaining unexercised shall be issued by the Rights Agent to
the registered holder of such Right Certificate or to his
duly authorized assigns, subject to the provisions of
Section 15 hereof.
Section 9. Cancellation and Destruction of Right
Certificates. All Right Certificates surrendered for the
purpose of exercise, transfer or exchange shall, if surrender-
ed to the Company or to any of its other agents, be
delivered to the Rights Agent for such purpose and for
cancellation or, if surrendered to the Rights Agent for such
purpose, shall be cancelled by it. No Right Certificates
shall be authenticated in lieu of or in exchange for any
Right Certificates cancelled as provided in this Section
except as expressly permitted by any of the provisions of
this Agreement. The Company shall deliver to the Rights
Agent for cancellation, and the Rights Agent shall so
cancel, any other Right Certificate purchased or acquired by
the Company. The Rights Agent shall deliver all cancelled
Right Certificates to the Company, or shall, pursuant to a
Company Order, destroy such cancelled Right Certificates and
in such case shall deliver a certificate of destruction
thereof to the Company.
Section 10. Reservation and Availability of Shares.
The Company covenants and agrees that it will cause to be
reserved and kept available out of its authorized and
unissued Preferred Shares or any Preferred Shares held in
its treasury, the number of Preferred Shares that will be
sufficient to permit the exercise in full of all outstanding
Rights.
The Company covenants and agrees that it will take
all such action as may be necessary to ensure that all
Preferred Shares or Common Shares of the Company issued upon
exercise of Rights shall (subject to payment of the Purchase
Price) be duly authorized, validly issued, fully paid and
nonassessable. 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 Certifi-
cates or of any Preferred Shares (or depositary receipts
therefor) or Common Shares of the Company 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 certifi-
cates or depositary receipts for the Preferred Shares or
Common Shares of the Company upon exercise of Rights
evidenced by Right Certificates in a name other than that of,
the registered holder of the Right Certificate evidencing
Rights surrendered for transfer or exercise or to issue or
deliver any certificates or depositary receipts for
Preferred Shares or Common Shares of the Company upon the
exercise of any Rights until any such tax shall have been
paid (any such tax being payable by the holder of such Right
Certificate at the time of surrender thereof) or until it
has been established to the Company's satisfaction that no
such tax is due.
Section 11. Record Date. Each Person in whose name
any certificate for Preferred Shares or Common Shares of the
Company is issued upon the exercise of, or upon mandatory
redemption and exchange of, Rights shall for all purposes be
deemed to have become the holder of record of the Preferred
Shares or Common Shares represented thereby on, and such
certificate shall be dated, (i) in the case of the exercise
of Rights, the date upon which the Right Certificate
evidencing such Rights was duly surrendered and payment of
the Purchase Price (and any applicable transfer taxes) was
made, or (ii) in the case of the mandatory redemption and
exchange of Rights, the date of such mandatory redemption
and exchange; provided, however, that, if the date of such
surrender and payment or mandatory redemption and exchange
is a date upon which the transfer books of the Company for
its Preferred Shares or Common Shares, as the case may be,
are closed, such Person shall be deemed to have become the
record holder of such shares on, and such certificate shall
be dated, the next succeeding Business Day on which such
transfer books of the Company are open.
Section 12. Adjustment of Purchase Price, Number of
Shares or Number of Rights. The Purchase Price, the number
and kind of shares of capital stock of the Company covered
by each Right and the number of Rights outstanding are
subject to adjustment from time to time as provided in this
Section 12.
(a) (i) If the Company shall at any time (A) declare
a dividend on the Preferred Shares payable in Preferred
Shares, (B) subdivide the outstanding Preferred Shares,
(C) combine the outstanding Preferred Shares into a
smaller number of Preferred Shares or (D) issue any
shares of its capital stock in a reclassification of
the Preferred Shares (including any such
reclassification in connection with a consolidation or
merger in which the Company is the continuing or
surviving corporation), except as otherwise provided in
this Section 12(a), the Purchase Price in effect at the
time of the record date for such dividend or of the
effective date of such subdivision, combination or
reclassification, and the number and kind of shares of
capital stock issuable on such date, shall be
proportionately adjusted so that the holder of any
Right exercised thereafter shall be entitled to
receive, upon payment of the Purchase Price for the
number of one one-thousandth of a Preferred Share for
which a Right was exercisable immediately prior to such
date, the aggregate number and kind of shares of
capital stock which, if such Right had been duly
exercised immediately prior to such date (at a time
when the Preferred Shares transfer books of the Company
were open), such holder would have acquired upon such
exercise and been entitled to receive upon payment or
effectuation of such dividend, subdivision, combination
or reclassification; provided, however, that in no
event shall the consideration to be paid upon the
exercise of one Right be less than the aggregate par
value of the shares of capital stock of the Company
issuable upon exercise of one Right. If an event
occurs which would require an adjustment under both
Section 12(a)(i) and Section 12(a)(ii), the adjustment
provided for in this Section 12(a)(i) shall be in
addition to, and shall be made prior to, any adjustment
required pursuant to Section 12(a)(ii).
(ii) Subject to action of the Board of Directors
of the Company pursuant to Section 25 of this
Agreement, if any Person shall become an Acquiring
Person, each holder of a Right shall thereafter have a
right to receive, upon exercise thereof at a price
equal to the then current Purchase Price multiplied by
the number of one one-thousandth of a Preferred Share
for which a Right is then exercisable, in accordance
with the terms of this Agreement and in lieu of
Preferred Shares, such number of Common Shares of the
Company as shall equal the result obtained by (x)
multiplying the then current Purchase Price by the
number of one one-thousandth of a Preferred Share for
which a Right is then exercisable and dividing that
product by (y) 50% of the then current per share market
price of the Company's Common Shares (determined
pursuant to Section 12(d)) on the date such Person
became an Acquiring Person. If any Person shall become
an Acquiring Person and the Rights shall then be
outstanding, the Company shall not take any action
which would eliminate or diminish the benefits intended
to be afforded by the Rights.
Notwithstanding any other provision of this
Agreement, from and after the time any Person shall
become an Acquiring Person, any Rights that are or were
acquired or beneficially owned by any such Acquiring
Person (or any Associate or Affiliate of such Acquiring
Person) shall be null and void and any holder of such
Rights shall thereafter have no right to exercise such
Rights under any provision of this Agreement. No Right
Certificate shall be issued pursuant to this Agreement
that represents Rights beneficially owned by an
Acquiring Person whose Rights would be null and void
pursuant to the preceding sentence or by any Associate
or Affiliate thereof; no Right Certificate shall be
issued at any time upon the transfer of any Rights to
an Acquiring Person whose Rights would be null and void
pursuant to the preceding sentence or to any Associate
or Affiliate thereof or to any nominee (acting in its
capacity as such) of such Acquiring Person, Associate
or Affiliate; and any Right Certificate delivered to
the Rights Agent for transfer to an Acquiring Person
whose Rights would be null and void pursuant to the
preceding sentence or to any Associate or Affiliate
thereof or to any nominee (acting in its capacity as
such) of such Acquiring Person, Associate or Affiliate
shall be cancelled.
(iii) If on or after the Distribution Date
there shall not be sufficient Common Shares issued but
not outstanding, or authorized but unissued, to permit
the exercise in full of all outstanding Rights in
accordance with the foregoing subparagraph (ii), the
Company agrees to take all such action as is within its
power, including without limitation appropriate action
by its Board of Directors, as may be necessary to amend
the Company's charter to authorize additional Common
Shares for issuance upon exercise of the Rights. If,
notwithstanding the foregoing, the stockholders shall
not approve an amendment to the Company's charter
authorizing such additional Common Shares, the
adjustment prescribed in Section 12(a)(ii) shall not be
made but, in lieu thereof, each holder of a Right shall
have the right to receive, upon exercise thereof in
accordance with the terms of this Agreement, such
number of one one-thousandth of Preferred Shares as
shall equal the result obtained by (x) multiplying the
then current Purchase Price by the number of one one-
thousandth of a Preferred Share for which a Right is
then exercisable and dividing that product by (y) 50%
of the then current per share market price of one one-
thousandth of a Preferred Share (determined pursuant to
Section 12(d)) on the date such Person became an
Acquiring Person.
(b) If the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of
Preferred Shares entitling them (for a period expiring
within 45 calendar days after such record date) to subscribe
for or purchase Preferred Shares (or shares having the same
rights, privileges and preferences as the Preferred Shares
("equivalent preferred shares")) or securities convertible
into or exchangeable for Preferred Shares or equivalent
preferred shares at a price per Preferred Share or
equivalent preferred share (together with any additional
consideration required upon conversion or exchange in the
case of a security convertible into or exchangeable for
Preferred Shares or equivalent preferred shares), less than
the current per share market price of the Preferred Shares
(determined pursuant to Section 12(d) on such record date),
the Purchase Price to be in effect after such record date
shall be determined by multiplying the Purchase Price in
effect immediately prior to such record date by a fraction,
the numerator of which shall be the number of Preferred
Shares outstanding on such record date plus the number of
Preferred Shares which the aggregate offering price of the
total number of Preferred Shares and/or equivalent preferred
shares so to be offered (together with the aggregate of any
additional consideration required upon conversion or
exchange in the case of any convertible or exchangeable
securities so to be offered) would purchase at such current
market price and the denominator of which shall be the
number of Preferred Shares outstanding on such record date
plus the number of additional Preferred Shares and/or
equivalent preferred shares to be offered for subscription
or purchase (or into or for which the convertible or
exchangeable securities so to be offered are initially
convertible or exchangeable); provided, however, that in no
event shall the consideration to be paid upon the exercise
of one Right be less than the aggregate par value of the
shares of capital stock of the Company issuable upon
exercise of one Right. In case all or part of such sub-
scription or purchase price may be paid in a form other than
cash, the value of such consideration shall be as determined
in good faith by the Board of Directors of the Company,
whose determination shall be described in a statement filed
with the Rights Agent. Preferred Shares owned by or held
for the account of the Company or any of its Subsidiaries
shall not be deemed outstanding for the purpose of any
computation described in this Section 12(b). The adjustment
described in this Section 12(b) shall be made successively
whenever such a record date is fixed; and, if none of such
rights, options or warrants is so issued, the Purchase Price
shall be adjusted to be the Purchase Price which would then
be in effect if such record date had not been fixed.
(c) If the Company shall fix a record date for the
making of a distribution to all holders of the Preferred
Shares (including any such distribution made in connection
with a consolidation or merger in which the Company is the
continuing or surviving corporation) of evidences of indebt-
edness or assets (other than a regular quarterly cash
dividend or a dividend payable in Preferred Shares) or
subscription rights or warrants (excluding those referred to
in Section 12(b)), the Purchase Price to be in effect after
such record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such record
date by a fraction, the numerator of which shall be the then
current per share market price of the Preferred Shares
(determined pursuant to Section 12(d)) on such record date,
less the fair market value (as determined in good faith by
the Board of Directors of the Company, whose determination
shall be described in a statement filed with the Rights
Agent) of the portion of the assets or evidences of
indebtedness so to be distributed or of such subscription
rights or warrants applicable to one Preferred Share and the
denominator of which shall be such current per share market
price of the Preferred Shares; provided, however, that in no
event shall the consideration to be paid upon the exercise
of one Right be less than the aggregate par value of the
shares of capital stock of the Company to be issued upon the
exercise of one Right. Such adjustments shall be made
successively whenever such a record date is fixed; and, if
such distribution is not so made, the Purchase Price shall
again be adjusted to be the Purchase Price which would then
be in effect if such record date had not been fixed.
(d) (i) For the purpose of any computation hereunder,
the "current per share market price" of the Common
Shares on any date shall be deemed to be the average of
the daily Closing Prices per share of such Common
Shares for the 30 consecutive Trading Days immediately
prior to such date; provided, however, that, if the
issuer of such Common Shares shall announce (A) a
dividend or distribution on such Common Shares payable
in such Common Shares or securities convertible into
such Common Shares or (B) any subdivision, combination
or reclassification of such Common Shares, and the
ex-dividend date for such dividend or distribution, or
the record date for such subdivision, combination or
reclassification, shall occur during such period of 30
Trading Days, then, and in each such case, the current
per share market price of the Common Shares shall be
appropriately adjusted to reflect the current market
price per Common Share equivalent.
(ii) For the purpose of any computation hereunder,
the "current per share market price" of the Preferred
Shares shall be determined in the same manner as set
forth above for Common Shares in paragraph (i) of this
Section 12(d). If the current per share market price
of the Preferred Shares cannot be determined in the
manner provided above, the "current per share market
price" of the Preferred Shares shall be conclusively
deemed to be the current per share market price of the
Common Shares (determined in the manner provided above)
multiplied by one thousand.
(e) No adjustment in the Purchase Price shall be
required unless such adjustment would require an increase or
decrease of at least 1% in the Purchase Price; provided,
however, that any adjustments which by reason of this
Section 12(e) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment.
All calculations under this Section 12 shall be made to the
nearest cent or to the nearest ten-thousandth of a Common
Share or other share or one ten-millionth of a Preferred
Share, as the case may be, and references herein to the
"number of one one-thousandth of a Preferred Share" (or
similar phrases) shall be construed to include fractions of
one one-thousandth of a Preferred Share. Notwithstanding
the first sentence of this Section 12(e), any adjustment
required by this Section 12 shall be made no later than the
earlier of (i) three years from the date of the transaction
which requires such adjustment or (ii) the thirtieth day
preceding the Final Expiration Date.
(f) If as a result of an adjustment made pursuant to
Section 12(a), the holder of any Right thereafter exercised
shall become entitled to receive any shares of capital stock
of the Company other than Preferred Shares, thereafter the
number of such other shares so receivable upon exercise of
any Right shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the shares contained in
this Section 12, and the provisions of this Agreement,
including without limitation Sections 8, 10, 11 and 14, with
respect to the Preferred Shares shall apply on like terms to
any such other shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price
hereunder shall, whether or not the Right Certificate
evidencing such Rights reflects such adjusted Purchase
Price, evidence the right to purchase, at the adjusted
Purchase Price, the number of one one-thousandth of a
Preferred Share purchasable from time to time hereunder upon
exercise of the Rights, all subject to further adjustment as
provided herein.
(h) Unless the Company shall have exercised its
election as provided in Section 12(i), upon each adjustment
of the Purchase Price pursuant to Section 12(b) or 12(c),
each Right outstanding immediately prior to the making of
such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price per one one-
thousandth of a Preferred Share, that number of one one-
thousandth of a Preferred Share obtained by (i) multiplying
(x) the number of one-thousandth of a share covered by a
Right immediately prior to this adjustment by (y) the
Purchase Price in effect immediately prior to such adjust-
ment of the Purchase Price and (ii) dividing the product so
obtained by the Purchase Price in effect immediately after
such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of
Rights outstanding in lieu of any adjustment in the number
of one one-thousandth of a Preferred Share purchasable upon
the exercise of a Right. Each Right outstanding after such
adjustment of the number of Rights shall be exercisable for
the number of one one-thousandth of a Preferred Share for
which a Right was exercisable immediately prior to such
adjustment of the Purchase Price. Each Right held of record
prior to such adjustment of the number of Rights shall
become that number of Rights (calculated to the nearest one
ten-thousandth) obtained by dividing the Purchase Price in
effect immediately prior to adjustment of the Purchase Price
by the Purchase Price in effect immediately after adjustment
of the Purchase Price. The Company shall make a public
announcement of its election to adjust the number of Rights,
indicating the record date for the adjustment, and, if known
at the time, the amount of the adjustment to be made. This
record date may be the date on which the Purchase Price is
adjusted or any day thereafter, but, if the Right
Certificates have been issued, shall be at least 10 days
later than the date of the public announcement. Until such
record date, however, any adjustment in the number of one
one-thousandth of a Preferred Share for which a Right shall
be exercisable made as required by this Agreement shall
remain in effect. If Right Certificates have been issued,
upon each adjustment of the number of Rights pursuant to
this Section 12(i), the Company shall, as promptly as practi-
cable, cause to be distributed to holders of record of Right
Certificates on such record date Right Certificates evidenc-
ing, subject to Section 15 hereof, the additional Rights to
which such holders shall be entitled as a result of such
adjustment, or, at the option of the Company, shall cause to
be distributed to such holders of record in substitution and
replacement for the Right Certificates held by such holders
prior to the date of adjustment, and upon surrender thereof,
if required by the Company, new Right Certificates evidenc-
ing all the Rights to which such holders shall be entitled
after such adjustment. Right Certificates so to be distri-
buted shall be issued, executed and authenticated in the
manner provided for herein and shall be registered in the
names of the holders of record of Right Certificates on the
record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the
Purchase Price or the number of one one-thousandth of a
Preferred Share issuable upon the exercise of the Rights,
the Right Certificates theretofore and thereafter issued may
continue to express the Purchase Price and the number of one
one-thousandth of a Preferred Share which were expressed in
the initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an
adjustment reducing the Purchase Price below one one-
thousandth of the amount of consideration per Preferred
Share determined by the Board of Directors of the Company to
be capital, or below one one-thousandth of the par value, if
any, per Preferred Share issuable upon exercise of the
Rights, the Company agrees to take such corporate action as
is within its power, including without limitation
appropriate action by its Board of Directors, and which is,
in the opinion of its counsel, necessary in order that the
Company may validly and legally issue fully paid and
nonassessable one one-thousandth of Preferred Shares at such
adjusted Purchase Price.
(l) In any case in which this Section 12 shall require
that an adjustment in the Purchase Price be made effective
as of a record date for a specified event, the Company may
elect to defer until the occurrence of such event the
issuance to the holder of any Right exercised after such
record date of the Preferred Shares or other capital stock
or securities of the Company, if any, issuable upon such
exercise over and above the Preferred Shares or other
capital stock or securities of the Company, if any, issuable
upon such exercise on the basis of the Purchase Price in
effect prior to such adjustment; provided, however, that the
Company shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder's right to
receive such additional securities upon the occurrence of
the event requiring such adjustment.
(m) Anything in this Section 12 to the contrary
notwithstanding, the Company shall be entitled to make such
reductions in the Purchase Price, in addition to those
adjustments expressly required by this Section 12, as and to
the extent that it in its sole discretion shall determine to
be advisable in order that any combination or subdivision of
the Preferred Shares, issuance wholly for cash of any of the
Preferred Shares at less than the current market price,
issuance wholly for cash of Preferred Shares or securities
which by their terms are convertible into or exchangeable
for Preferred Shares, dividends on Preferred Shares payable
in Preferred Shares or issuance of rights, options or
warrants referred to in subsection (b) of this Section 12,
hereafter effected by the Company to holders of its
Preferred Shares shall not be taxable to such shareholders.
(n) If at any time prior to the Distribution Date, the
Company shall (i) declare or pay any dividend on the Common
Shares payable in Common Shares or (ii) effect a subdivision
or combination of the Common Shares (by reclassification or
otherwise than by payment of dividends in Common Shares)
into a greater or lesser number of Common Shares, then in
any such case (i) the Purchase Price in effect at the time
of the record date for such dividend or of the effective
date of such subdivision or combination shall be adjusted by
multiplying such Purchase Price by a fraction, the numerator
of which is the number of Common Shares outstanding
immediately before such event and the denominator of which
is the number of Common Shares outstanding immediately after
such event, and (ii) the number of Rights outstanding
immediately after such event shall be adjusted, either
through cancellation of outstanding Rights or through
distribution of additional Rights (but without duplication
of the Company's obligations under Section 3(c)), so that
the certificate evidencing each Common Share outstanding
immediately after such event shall also evidence the
associated Right to purchase the same number of one
one-thousandth of a Preferred Share as to which a Right
would have entitled the holder thereof to purchase
immediately prior to such event. The adjustment provided
for in this Section 12(n) shall be made successively when
ever such a dividend is declared or paid or such a subdivi-
sion or combination is effected. If an event occurs which
would require an adjustment under Section 12(a)(ii) and this
Section 12(n), the adjustments provided for in
this Section 12(n) shall be in addition and prior to
any adjustment required pursuant to Section 12(a)(ii).
Section 13. Certificate of Adjusted Purchase Price or
Number of Shares. Whenever an adjustment is made as pro
vided in Section 12 or 14 hereof, the Company shall (a)
promptly prepare a certificate setting forth such adjust-
ment, 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 Common Shares of the Company and
the Preferred Shares a copy of such certificate and (c) mail
a brief summary thereof to each holder of record of a Right
Certificate in accordance with Section 28 hereof.
Section 14. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power. If, directly or indirectly, (a)
the Company shall consolidate with, or merge with and into,
any other Person, (b) any Person shall merge with and into
the Company and the Company shall be the continuing or
surviving corporation of such merger and, in connection with
any such merger, all or part of the Common Shares of the
Company shall be changed into or exchanged for stock or
other securities of any other Person (or the Company) or
cash or any other property, or (c) the Company shall sell or
otherwise transfer (or one or more of its Subsidiaries shall
sell or otherwise transfer), in one or a series of two or
more transactions, assets of the Company or its Subsidiaries
which constitute more than 50% of the assets or which
produce more than 50% of the earning power of the Company
and its Subsidiaries (taken as a whole) to any Person or any
Affiliate or Associate of such Person other than the Company
or one or more of its Wholly-Owned Subsidiaries, then, and
in each such case, the Company agrees that, as a condition
to engaging in any such transaction, it will make or cause
to be made proper provision so that (i) each holder of a
Right (except as otherwise provided herein) shall thereafter
have the right to receive, upon the exercise thereof in
accordance with the terms of this Agreement and in lieu of
Preferred Shares, such number of Common Shares of such other
Person (including the Company as successor thereto or as the
surviving corporation) or, if such other Person is a Subsi-
diary of another Person, of the Person or Persons (other than
individuals) which ultimately control such first-mentioned
Person, as shall be equal to the result obtained by (X)
multiplying the then current Purchase Price by the number of
one one-thousandth of a Preferred Share for which a Right is
then exercisable (without taking into account any adjustment
previously made pursuant to Section 12(a)(ii)) and dividing
that product by (Y) 50% of the current per share market
price of the Common Shares of such other Person (determined
pursuant to Section 12(d)) on the date of consummation of
such consolidation, merger, sale or transfer; (ii) the
issuer of such Common Shares shall thereafter be liable for,
and shall assume, by virtue of such consolidation, merger,
sale or transfer, all the obligations and duties of the
Company pursuant to this Agreement; (iii) the term
"Company," as used herein, shall thereafter be deemed to
refer to such issuer; and (iv) such issuer shall take such
steps (including without limitation the reservation of a
sufficient number of shares of its Common Shares in accord-
ance with Section 10) in connection with such consummation
as may be necessary to assure that the provisions hereof
shall thereafter be applicable, as nearly as reasonably may
be, in relation to the Common Shares thereafter deliverable
upon the exercise of the Rights. The Company shall not
enter into any transaction of the kind referred to in this
Section 14 if at the time of such transaction there are
outstanding any rights, warrants, instruments or securities
or any agreement or arrangements which, as a result of the
consummation of such transaction, would substantially
diminish or otherwise eliminate the benefits intended to be
afforded by the Rights. The Company shall not consummate
any such consolidation, merger, sale or transfer unless
prior thereto the Company and such issuer shall have
executed and delivered to the Rights Agent an agree-
ment supplemental to this Agreement complying with the
provisions of this Section 14. The provisions of this Sec-
tion 14 shall similarly apply to successive mergers
or consolidations or sales or other transfers. For the pur-
poses of this Section 14, 50% of the assets of
the Company and its Subsidiaries shall be determined by
reference to the book value of such assets as set forth in
the most recent consolidated balance sheet of the Company
and its Subsidiaries (which need not be audited) and 50% of
the earning power of the Company and its Subsidiaries shall
be determined by reference to the mathematical average
of the operating income resulting from the operations of
the Company and its Subsidiaries for the two most recent
full fiscal years as set forth in the consolidated and
consolidating financial statements of the Company and
its Subsidiaries for such years; provided, however,
that, if the Company has, during such period, engaged
in one or more transactions to which purchase
accounting is applicable, such determination shall be made
by reference to the pro forma operating income of the
Company and its Subsidiaries giving effect to such
transactions as if they had occurred at the commencement of
such two-year period.
Section 15. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue or distribute
Right Certificates which evidence fractional Rights. If, on
the Distribution Date or thereafter, as a result of any
adjustment effected pursuant to Section 12(i) or otherwise
hereunder, a Person would otherwise be entitled to receive a
Right Certificate evidencing a fractional Right, the Company
shall, in lieu thereof, pay or cause to be paid to such
Person an amount in cash equal to the same fraction of the
current market value of a whole Right. For the purpose of
this Section 15(a), the current market value of a whole
Right shall be the Closing Price of the Rights for the
Trading Day immediately prior to the date on which such
fractional Rights would have been otherwise issuable.
(b) The Company shall not be required to issue frac-
tions of Preferred Shares (other than fractions which are
integral multiples of one one-thousandth of a Preferred
Share) upon exercise of the Rights or to distribute certifi-
cates which evidence fractional Preferred Shares (other
than fractions which are integral multiples of one
one-thousandth of a Preferred Share). Fractions of
Preferred Shares in integral multiples of one one-thousandth
of a Preferred Share may, at the election of the Company, be
evidenced by depositary receipts, pursuant to an appropriate
agreement between the Company and a depositary selected by
it, provided that such agreement shall provide that the
holders of such depositary receipts shall have all the
rights, privileges and preferences to which they are
entitled as beneficial owners of the Preferred Shares. If,
on the Distribution Date or thereafter, as a result of any
adjustment effected hereunder in the number of one
one-thousandth of a Preferred Share as to which a Right has
become exercisable, a Person would otherwise be entitled to
receive a fractional Preferred Share that is not an integral
multiple of one one-thousandth of a Preferred Share, the
Company shall, in lieu thereof, pay to such Person at the
time such Right is exercised as herein provided an amount in
cash equal to the same fraction (which is not an integral
multiple of one one-thousandth of a Preferred Share) of the
current market value of one Preferred Share. For purposes
of this Section 15(b), the current market value of a Pre-
ferred Share shall be the Closing Price of a Preferred Share
for the Trading Day immediately prior to the date of such
exercise.
(c) Should any adjustment contemplated by Sec-
tion 12(a)(ii) or any mandatory redemption and exchange
contemplated by Section 25 occur, the Company shall not be
required to issue fractions of Common Shares upon exercise
of the Rights or to distribute certificates which evidence
fractional Common Shares. If after any such adjustment or
mandatory redemption and exchange, a Person would otherwise
be entitled to receive a fractional Common Share of the
Company upon exercise of any Right Certificate or upon
mandatory redemption and exchange as contemplated by Section
25, the Company shall, in lieu thereof, pay to such Person
at the time such Right is exercised as herein provided or
upon such mandatory redemption and exchange an amount in
cash equal to the same fraction of the current market value
of one Common Share. For purposes of this Section 15(c),
the current market value of a Common Share shall be the
Closing Price of a Common Share for the Trading Day immediate-
ely prior to the date of such exercise or the date of such
mandatory redemption and exchange.
(d) The holder of a Right by the acceptance thereof
expressly waives his right to receive any fractional Rights
or any fractional shares upon exercise or mandatory
redemption and exchange of a Right (except as provided
above).
Section 16. Rights of Action. (a) All rights of
action in respect of the obligations and duties owed to the
holders of the Rights under this Agreement are vested in the
registered holders of the Rights; and, without the consent
of the Rights Agent or of the holder of any other Rights,
any registered holder of any Rights may, in his own behalf
and for his own benefit, enforce, and may institute and
maintain any suit, action or proceeding, judicial or other
wise, against the Company to enforce, or otherwise to act in
respect of, such holder's right to exercise such Rights in
the manner provided in the Right Certificate evidencing such
Rights and in this Agreement. Without limiting the foregoing
or any remedies available to the holders of Rights, it
is specifically acknowledged that the holders of Rights
would not have an adequate remedy at law for any breach of
this Agreement and will be entitled to specific performance
of the obligations under, and injunctive relief against
actual or threatened violations of, the obligations of any
Person subject to this Agreement.
(b) No right or remedy herein conferred upon or
reserved to the registered holder of Rights is intended to
be exclusive of any other right or remedy, and every right
and remedy shall, to the extent permitted by law, be cumula-
tive and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity
or otherwise. The assertion or employment of any right or
remedy, whether hereunder or otherwise, shall not prevent
the concurrent assertion or employment of any other appro-
priate right or remedy.
(c) No delay or omission of any registered holder of
Rights to exercise any right or remedy accruing hereunder
shall impair any such right or remedy or constitute a waiver
of any default hereunder or an acquiescence therein. Every
right and remedy given hereunder or by law to such holders
may be exercised from time to time, and as often as may be
deemed expedient, by such holders.
Section 17. Agreement of Right Holders. Every holder
of a Right, by accepting the same, consents and agrees with
the Company and the Rights Agent and with every other holder
of a Right that:
(a) prior to the Distribution Date, the Rights
will be transferable only in connection with the
transfer of the Common Shares of the Company;
(b) after the Distribution Date, the Right
Certificates are transferable only on the registry
books of the Rights Agent if surrendered at the
Corporate Trust Office of the Rights Agent duly
endorsed or accompanied by a proper instrument of
transfer; and
(c) the Company and the Rights Agent may deem and
treat the person in whose name the Right Certificate
(or, prior to the Distribution Date, the associated
Common Shares certificate) is registered as the
absolute owner thereof and of the Rights evidenced
thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the associated
Common Shares certificate made by anyone other than the
Company or the Rights Agent) for all purposes, and
neither the Company nor the Rights Agent shall be
affected by any notice to the contrary.
Section 18. Right Certificate Holder Not Deemed a
Stockholder. No holder, as such, of any Right (whether or
not then evidenced by a Right Certificate) shall be entitled
to vote, receive dividends or be deemed for any purpose the
holder of Preferred Shares, Common Shares of the Company or
any other securities of the Company which may at any time be
issuable on the exercise (or mandatory redemption and
exchange) of the Rights represented thereby, nor shall
anything contained herein or in any Right Certificate be
construed to confer upon any such holder, as such, any of
the rights of a stockholder of the Company, including
without limitation any right to vote for the election of
directors or upon any matter submitted to stockholders at
any meeting thereof, to give or withhold consent to any
corporate action, to receive notice of meetings or other
actions affecting stockholders (except as provided in
Section 26) or to receive dividends or subscription rights
until the Right or Rights evidenced by such Right Certifi-
cate shall have been exercised (or mandatorily redeemed and
exchanged) in accordance with the provisions hereof.
Section 19. Concerning the Rights Agent. The Company
agrees to pay to the Rights Agent reasonable compensation
for all services rendered by it hereunder and, from time to
time, on demand of the Rights Agent, its reasonable expenses
and counsel fees and other disbursements incurred in the
administration and execution of this Agreement and the
exercise and performance of its duties hereunder. The
Company also agrees to indemnify the Rights Agent for, and
to hold it harmless against, any loss, liability or expense,
incurred without negligence, bad faith or willful misconduct
on the part of the Rights Agent, for anything done or
omitted by the Rights Agent in connection with the accept-
ance and administration of this Agreement, including the
costs and expenses of defending against any claim of
liability in the premises.
The Rights Agent shall be protected and shall incur no
liability for, or in respect of any action taken, suffered
or omitted by it in connection with, its administration of
this Agreement in reliance upon any Right Certificate or
certificate for Preferred Shares, Common Shares of the
Company or other securities of the Company, Company Order,
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 executed and, where necessary,
verified or acknowledged, by the proper person or persons,
or otherwise upon the advice of its counsel as set forth in
Section 20 hereof.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions, by all of
which the Company and the holders of Right Certificates, by
their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal
counsel (who may be legal counsel for the Company), and
the opinion of such counsel shall be full and complete
authorization and protection to the Rights Agent as to
any action taken or omitted by it in good faith and in
accordance with such opinion.
(b) Whenever in the performance of its duties
under this Agreement the Rights Agent shall deem it
necessary or desirable that any fact or matter be
proved or established by the Company prior to taking or
suffering any action hereunder, such fact or matter
(unless other evidence in respect thereof be herein
specifically prescribed) may be deemed to be
conclusively proved and established by a certificate
signed by any one of the Chairman of the Board, the
President, any Vice President, the Treasurer, any
Assistant Treasurer, the Secretary or any Assistant
Secretary of the Company and delivered to the Rights
Agent; and such certificate shall be full authorization
to the Rights Agent for any action taken or suffered in
good faith by it under the provisions of this Agreement
in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder to
the Company or any other Person only for its own
negligence, bad faith or willful misconduct. Anything
in this Agreement to the contrary notwithstanding, in
no event shall the Rights Agent be liable for special,
indirect or consequential loss or damage of any kind
whatsoever (including, but not limited to, lost
profits), even if the Rights Agent has been advised of
the likelihood of such loss or damage and regardless of
the form of action.
(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 authentication 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 have any responsi-
bility with respect to the validity of this Agreement
or the execution and delivery hereof (except the due
execution hereof by the Rights Agent) or with respect
to the validity or execution of any Right Certificate
(except its authentication 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 12(a)(ii) hereof) or any adjustment in the
terms of the Rights (including the manner, method or
amount thereof) provided for in Sections 3, 12, 14, 24
and 25, or the ascertainment of the existence of facts
that would require any such change or adjustment
(except with respect to the exercise of Rights
evidenced by Right Certificates after actual notice
that such change or adjustment is required); nor shall
it by any act hereunder be deemed to make any
representation or warranty as to the authorization or
reservation of any Preferred Shares or Common Shares to
be issued pursuant to this Agreement or any Right
Certificate or as to whether any Preferred Shares or
Common Shares will, when issued, be duly authorized,
validly issued, fully paid and nonassessable.
(f) The Company agrees that it will perform,
execute, acknowledge and deliver or cause to be
performed, executed, acknowledged and delivered all
such further and other acts, instruments and assurances
as may reasonably be required by the Rights Agent for
the carrying out or performing by the Rights Agent of
the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and
directed to accept instructions with respect to the
performance of its duties hereunder from any one of the
Chairman of the Board, the President, any Vice
President, the Treasurer, any Assistant Treasurer, the
Secretary or any Assistant Secretary of the Company,
and to apply to such officers for advice or
instructions in connection with its duties, and it
shall not be liable for any action taken or suffered to
be taken by it in good faith in accordance with
instructions of any such officer.
(h) The Rights Agent and any shareholder,
director, officer or employee of the Rights Agent may
buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily
interested in any transaction in which the Company may
be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though
it were not Rights Agent under this Agreement. Nothing
herein shall preclude the Rights Agent from acting in
any other capacity for the Company.
(i) The Rights Agent may execute and exercise any
of the rights or powers hereby vested in it or perform
any duty hereunder either itself or by or through its
attorneys or agents, and the Rights Agent shall not be
answerable or accountable for any act, default, neglect
or misconduct of any such attorneys or agents or for
any loss of the Company resulting from any such act,
default, neglect or misconduct provided reasonable care
was exercised in the selection and continued employment
thereof.
Section 21. Merger or Consolidation or Change of Name
of Rights Agent. Any corporation into which the Rights
Agent or any successor Rights Agent may be merged or with
which it may be consolidated, or any corporation resulting
from any merger or consolidation to which the Rights Agent
or any successor Rights Agent shall be a party, or any
corporation succeeding to the corporate trust 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 22. If at the
time such successor Rights Agent shall succeed to the agency
created by this Agreement any of the Right Certificates
shall have been authenticated but not delivered, any such
successor Rights Agent may adopt the authentication of the
predecessor Rights Agent and deliver such Right Certificates
so authenticated, and, if at that time any of the Right
Certificates shall not have been authenticated, any successor
Rights Agent may authenticate such Right Certificates
either in the name of the predecessor Rights Agent or in the
name of the successor Rights Agent; and in all such cases
such Right Certificates shall have the full force provided
in the Right Certificates and in this Agreement.
If at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall
have been authenticated but not delivered, the Rights Agent
may adopt the authentication under its prior name and
deliver Right Certificates so authenticated; and, in case at
that time any of the Right Certificates shall not have been
authenticated, the Rights Agent may authenticate 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 22. Change of Rights Agent. The Rights Agent
or any successor Rights Agent may resign and be discharged
from its duties under this Agreement upon 30 days' notice in
writing mailed to the Company and to each transfer agent for
the Common Shares of the Company and the Preferred Shares by
registered or certified mail, and to the holders of the
Right Certificates by first-class mail. The Company may
remove the Rights Agent or any successor Rights Agent upon
30 days' notice in writing, mailed to the Rights Agent or
successor Rights Agent, as the case may be, and to each
transfer agent for the Common Shares of the Company and the
Preferred Shares by registered or certified mail, and to the
holders of the Right Certificates by first-class mail. If
the Rights Agent shall resign or be removed or shall other
wise become incapable of acting, the Company shall appoint a
successor to the Rights Agent. If the Company shall fail to
make such appointment within a period of 30 days after
giving notice of such removal or after it has been notified
in writing of such resignation or incapacity by the resign-
ing or incapacitated Rights Agent or by the registered
holder of a Right Certificate (or, prior to the Distribution
Date, of Common Shares), then any registered holder of a
Right Certificate (or, prior to the Distribution Date, of
Common Shares) may apply to any court of competent juris-
diction for the appointment of a new Rights Agent. Any
successor Rights Agent, whether appointed by the Company or
by such a court, shall be a corporation organized and doing
business under the laws of the United States or of any state
of the United States, which is authorized under such laws to
exercise corporate trust powers and is subject to super
vision or examination by federal or state authority and
which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $50 million. After
appointment, the successor Rights Agent shall be vested with
the same powers, rights, duties and responsibilities as if
it had been originally named as Rights Agent without further
act or deed; but the predecessor Rights Agent shall deliver
and transfer to the successor Rights Agent any property at
the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the
purpose. Not later than the effective date of any such
appointment, the Company shall file notice thereof in
writing with the predecessor Rights Agent and each transfer
agent for the Common Shares of the Company and the Preferred
Shares, and mail a notice thereof in writing to the register-
ed holders of the Right Certificates. Failure to give
any notice provided for in this Section 22, 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 23. 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 Rights Certificates evidencing Rights in
such form as may be approved by its Board of Directors to
reflect any adjustment or change in the Purchase Price per
share and the number or kind or class of shares or other
securities purchasable under the Right Certificates made in
accordance with the provisions of this Agreement.
Section 24. Redemption. (a) The Rights may be
redeemed by action of the Board of Directors of the Company
pursuant to paragraph (b) of this Section 24, or may be
redeemed and exchanged by action of the Board of Directors
of the Company pursuant to Section 25 herein, but shall not
be redeemed in any other manner.
(b) The Board of Directors of the Company may, at its
option, at any time prior to the time any Person becomes an
Acquiring Person redeem all but not less than all the then
outstanding Rights at a redemption price of one cent ($0.01)
per Right then outstanding, appropriately adjusted to
reflect any adjustment in the number of Rights outstanding
pursuant to Section 12(i) herein (such redemption price
being hereinafter referred to as the "Redemption Price").
Any such redemption of the Rights by the Board of Directors
may be made effective at such time, on such basis and with
such conditions as the Board of Directors in its sole
discretion may establish.
(c) The right of the registered holders of Right
Certificates to exercise the Rights evidenced thereby or, if
the Distribution Date has not theretofore occurred, the
inchoate right of the registered holders of Rights to
exercise the same shall, without notice to such holders or
to the Rights Agent and without further action, terminate
and be of no further force or effect effective as of the
time of adoption by the Board of Directors of the Company of
a resolution authorizing and directing the redemption of the
Rights pursuant to paragraph (b) of this Section 24 (or,
alternatively, if the Board of Directors qualified such
action as to time, basis or conditions, then at such time,
on such basis and with such conditions as the Board of
Directors may have established pursuant to such paragraph
(b)); thereafter, the only right of the holders of Rights
shall be to receive the Redemption Price. The Company shall
promptly give public notice of any redemption resolution
pursuant to paragraph (b) of this Section 24; provided,
however, that the failure to give, or any defect in, any
such notice shall not affect the validity of such
redemption. Within 10 days after the adoption of any
redemption resolution pursuant to paragraph (b) of this
Section 24, the Company shall give notice of such redemption
to the holders of the then outstanding Rights by mailing
such notice 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 agents for the Common Shares. Any notice which is
mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice. Each such
notice of redemption shall state the method by which the
payment of the Redemption Price will be made.
(d) Neither the Company nor any of its Affiliates or
Associates may acquire (other than, in the case of such
Affiliates and Associates, in their capacity as holders of
Common Shares of the Company), redeem or purchase for value
any Rights at any time in any manner other than as specifi-
cally set forth in this Section 24 or in Section 25 herein,
and other than in connection with the purchase of Common
Shares prior to the Distribution Date.
Section 25. Mandatory Redemption and Exchange. (a)
The Board of Directors of the Company may, at its option, at
any time after any Person becomes an Acquiring Person, issue
Common Shares of the Company in mandatory redemption of, and
in exchange for, all or part of the then outstanding and
exercisable Rights (which shall not include Rights that have
become null and void pursuant to the provisions of Section
12(a)(ii) hereof) at an exchange ratio of one Common Share
for each Right, appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after
the date hereof. Notwithstanding the foregoing, the Board
of Directors shall not be empowered to effect such
redemption and exchange at any time after any Person (other
than the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or of any such
Subsidiary, or any trustee of or fiduciary with respect to
any such plan when acting in such capacity), together with
all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 50% or more of the Voting Shares then
outstanding.
(b) Immediately upon the action of the Board of
Directors of the Company ordering the mandatory redemption
and exchange of any Rights pursuant to subsection (a) of
this Section 25 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 such number of Common Shares as
is provided in paragraph (a) of this Section 25. The
Company shall promptly give public notice of any such
redemption and exchange; provided, however, that the failure
to give, or any defect in, such notice shall not affect the
validity of such redemption and exchange. The Company
promptly shall mail a notice of any such redemption and
exchange to all 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 mandatory
redemption and exchange shall state the method by which the
redemption and exchange of the Common Shares for Rights will
be effected and, in the event of any partial redemption and
exchange, the number of Rights which will be redeemed and
exchanged. Any partial redemption and exchange shall be
effected pro rata based on the number of Rights (other than
Rights which have become null and void pursuant to the
provisions of Section 12(a)(ii) hereof) held by each holder
of Rights.
(c) In any mandatory redemption and exchange pursuant
to this Section 25, the Company, at its option, may
substitute Preferred Shares (or equivalent preferred shares,
as such term is defined in Section 12(b) hereof) for Common
Shares, at the initial rate of one one-thousandth of a
Preferred Share (or equivalent preferred share) for each
Common Share, as appropriately adjusted.
Section 26. Notice of Certain Events. If the Company
shall, on or after the Distribution Date, propose (a) to pay
any dividend or other distribution payable in stock of any
class of the Company or any Subsidiary of the Company to the
holders of its Preferred Shares, (b) to distribute to the
holders of its Preferred Shares rights or warrants to
subscribe for or to purchase any additional Preferred Shares
or shares of stock of any class or any other securities,
rights or options, (c) to make any other distribution to the
holders of its Preferred Shares (other than a regular
quarterly cash dividend), (d) to effect any reclassification
of its Preferred Shares (other than a reclassification
involving only the subdivision of outstanding Preferred
Shares), (e) to effect any consolidation or merger into or
with, or to effect any sale or other transfer (or to permit
one or more of its Subsidiaries to effect any sale or other
transfer), in one or more transactions, of more than 50% of
the assets or earning power of the Company and its
Subsidiaries (determined as provided in Section 14 herein)
to, any other Person (other than the Company or a Wholly-
Owned Subsidiary or Wholly-Owned Subsidiaries), (f) to
effect the liquidation, dissolution or winding up of the
Company or (g) if the Rights have theretofore become exercis-
able with respect to Common Shares pursuant to Sec
tion 12(a)(ii) herein, to declare or pay any dividend or
other distribution on the Common Shares payable in Common
Shares or in stock of any other class of the Company or any
Subsidiary of the Company or to effect a subdivision or
combination of the Common Shares (by reclassification or
otherwise than by payment of dividends in Common Shares)
then, in each such case, the Company shall give to each
holder of a Right Certificate, in accordance with Section 28
hereof, notice of such proposed action, which shall specify
the date of authorization by the Board of Directors of the
Company of, and record date for, such stock dividend or such
distribution of rights or warrants or the date on which such
reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution, winding up, subdivision or
combination is to take place and the date of participation
therein by the holders of the Common Shares of the Company
or the Preferred Shares, or both, if any such date is to be
fixed. Such notice shall be so given in the case of any
action covered by clause (a), (b) or (g) above at least 20
days prior to the record date for determining holders of the
Preferred Shares or of the Common Shares of the Company, as
the case may be, for purposes of such action, and in the
case of any such other action, at least 20 days prior to the
date of the taking of such proposed action or the date of
participation therein by the holders of the Preferred Shares
or Common Shares of the Company, as the case may be,
whichever shall be the earlier.
If any of the events set forth in Section 12(a)(ii) of
this Agreement shall occur, then, in any such case, the
Company shall as soon as practicable thereafter give to each
holder of a Right Certificate, in accordance with Section 28
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 12(a)(ii) hereof.
Section 27. Securities Laws Registrations. To the
extent legally required, the Company agrees that it will
prepare and file, no later than the Distribution Date, and
will use its best efforts to cause to be declared effective,
a registration statement under the Securities Act of 1933,
as amended, registering the offering, sale and delivery of
the Preferred Shares issuable upon exercise of the Rights,
and the Company will, thereafter, use its best efforts to
maintain such registration statement (or another)
continuously in effect so long as any Rights remain
outstanding and exercisable with respect to Preferred
Shares. Should the Rights become exercisable with respect
to securities of the Company or one of its Subsidiaries
other than Preferred Shares, the Company agrees that it
will, to the extent legally required, promptly thereafter
prepare and file, or cause to be prepared and filed, and
will use its best efforts to cause to be declared effective,
a registration statement under such Act registering the
offering, sale and delivery of such other securities and the
Company will, thereafter, use its best efforts to maintain
such registration statement (or another) continuously in
effect so long as any outstanding Rights are exercisable
with respect to such securities. The Company further agrees
to use its best efforts, from and after the Distribution
Date, to qualify or register for sale the Preferred Shares
or other securities of the Company or one of its
Subsidiaries issuable upon exercise of the Rights under the
securities or "blue sky" laws (to the extent legally
required thereunder) of all jurisdictions in which
registered holders of Right Certificates reside determined
by reference to the Rights Register.
Section 28. Notices. Notices or demands authorized by
this Agreement to be given or made by the Rights Agent or by
the holder of any Right Certificate to or on the Company
shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed (until another address is
filed in writing with the Rights Agent) as follows:
Forcenergy Inc
2730 SW 3rd Avenue, Suite 800
Miami, Florida 33129
Attention: Chief Executive Officer
Subject to the provisions of Section 22 hereof, any notice
or demand authorized by this Agreement to be given or made
by the Company or by the holder of any Right Certificate to
or on the Rights Agent shall be sufficiently given or made
if sent by first-class mail, postage prepaid, addressed
(until another address is filed in writing with the Company)
as follows:
American Stock Transfer & Trust Company
40 Wall Street
New York, New York 10005
Attention: Corporate Trust Department
Notices or demands authorized by this Agreement to be given
or made by the Company or the Rights Agent to the holder of
any Right Certificate shall be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed to such
holder at the address of such holder as shown on the Rights
Register of the Company or, prior to the Distribution Date,
on the stock transfer records for the Common Shares of the
Company.
Section 29. Supplements and Amendments. The Company
may from time to time supplement or amend this Agreement
(which supplement or amendment shall be evidenced by a
writing signed by the Company and the Rights Agent) without
the approval of any holders of Right Certificates in order
to cure any ambiguity, to correct or supplement any
provision contained herein which may be defective or
inconsistent with any other provisions herein, to make any
other provisions in regard to matters or questions arising
hereunder, or to add, delete, modify or otherwise amend any
provision, which the Company may deem necessary or
desirable, including without limitation extending the Final
Expiration Date and, provided that at the time of such
amendment or supplement the Distribution Date has not
occurred, the period during which the Rights may be
redeemed; provided, however, that, from and after such time
as any Person becomes an Acquiring Person, any such
amendment or supplement shall not materially and adversely
affect the interests of the holders of Right Certificates.
Without limiting the foregoing, the Board of Directors of
the Company may by resolution adopted at any time prior to
such time as any Person becomes an Acquiring Person amend
this Agreement to lower the threshold set forth in the
definitions of Acquiring Person and Distribution Date herein
from 20% to a percentage not less than the greater of
(i) any percentage greater than the largest percentage of
the outstanding Voting Shares then known to the Company to
be beneficially owned by any Person (other than the Company,
Forcenergy AB, any Subsidiary of the Company, any employee
benefit plan of the Company or of any Subsidiary of the
Company, or any trustee of or fiduciary with respect to any
such plan when acting in such capacity), and (ii) 10%, if
the Board of Directors shall determine that a Person whose
interests are adverse to the Company and its shareholders
may seek to acquire control of the Company.
Section 30. Successors. All the covenants and provi-
sions 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 31. Benefits of this Agreement. Nothing in
this Agreement shall be construed to give to any Person
other than the Company, the Rights Agent and the registered
holders of the Rights 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 Rights.
Section 32. 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, provi-
sions, covenants and restrictions of this Agreement shall
remain in full force and effect and shall in no way be
affected, impaired or invalidated.
Section 33. Governing Law. This Agreement and each
Right Certificate issued hereunder shall be deemed to be a
contract made under the laws of the State of Delaware and
for all purposes shall be governed by and construed in
accordance with the laws of such State applicable to con
tracts to be made and performed entirely within such State.
Section 34. 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 consti-
tute but one and the same instrument.
Section 35. Descriptive Headings. Descriptive head-
ings of the several Sections of this Agreement are inserted
for convenience only and shall not control or affect the
meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and attested, all as of the
day and year first above written.
FORCENERGY INC
ATTEST:_______________________
Thomas F. Getten,
Secretary
By_____________________________
Name: Stig Wennerstrom
Title: President
AMERICAN STOCK TRANSFER & TRUST
COMPANY, as Rights Agent
ATTEST:_______________________
By_____________________________
Name:
Title:
<PAGE>
EXHIBIT A
CERTIFICATE OF DESIGNATION
OF
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
FORCENERGY INC
Pursuant to Section 151 of the General
Corporation Law of the State of Delaware
Forcenergy Inc, a Delaware corporation
(the "Corporation"), through the undersigned duly
authorized officer, in accordance with the provisions
of Sections 103 and 151 of the General Corporation
Law of the State of Delaware, DOES HEREBY CERTIFY:
That, the Board of Directors of the
Corporation, pursuant to the authority conferred
upon the Board of Directors by the Amended and
Restated Certificate of Incorporation of the
Corporation (the "Certificate of Incorporation")
and in accordance with the provisions of Section
151 of the General Corporation Law of the State of
Delaware, adopted the following resolution creating a
series of 150,000 shares of Preferred Stock, par
value $.01 per share:
RESOLVED, that, pursuant to the authority
expressly granted to and vested in the Board of
Directors of the Corporation in accordance with
the provisions of Article IV of its Certificate of
Incorporation, a series of the Preferred Stock of
the Corporation, par value $.01 per share, be, and
it hereby is, created and that the voting powers,
designations, preferences and relative, partici-
pating, optional and other special rights of the
shares of such series, and the qualification,
limitations or restrictions thereof are as
follows:
Series A Junior Participating Preferred Stock:
Section 1. Designation and Amount. The
shares of such series shall be designated as
"Series A Junior Participating Preferred Stock"
(the "Series A Preferred Stock") and the number of
shares constituting the Series A Preferred Stock
shall be 150,000. Such number of shares may be
increased or decreased by resolution of the Board
of Directors; provided that no decrease shall
reduce the number of shares of Series A Preferred
Stock to a number less than the number of shares
then outstanding plus the number of shares
reserved for issuance upon the exercise of
outstanding options, rights or warrants or upon
the conversion of any outstanding securities
issued by the Corporation convertible into
Series A Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of
any shares of any series of Preferred Stock (or
any similar stock) ranking prior and superior to
the Series A Preferred Stock with respect to
dividends, the holders of shares of Series A
Preferred Stock, in preference to the holders of
Common Stock, par value $.01 per share (the
"Common Stock"), of the Corporation, and of any
other junior stock, shall be entitled to receive,
when, as and if declared by the Board of Directors
out of funds legally available for the purpose,
quarterly dividends payable on the last business
day of March, June, September and December in each
year (each such date being referred to herein as a
"Quarterly Dividend Payment Date") as provided in
paragraphs (B) and (C) of this Section 2 in an
amount per share (rounded to the nearest cent)
equal to the greater of (a) $1.00 in cash or
(b) subject to the provision for adjustment
hereinafter set forth, 1,000 times the aggregate
per share amount (payable in cash) 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
Common Stock since the immediately preceding
Quarterly Dividend Payment Date or with respect to
the first Quarterly Dividend Payment Date, since
the first issuance of any share or fraction of a
share of Series A Preferred Stock. If the
Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of
Common Stock, or effect a subdivision or
combination or consolidation of the outstanding
shares of Common Stock (by reclassification or
otherwise) into a greater or lesser number of
shares of Common Stock, then in each such case the
amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to
such event under clause (b) of the preceding
sentence shall be adjusted by multiplying such
amount by a fraction, the numerator of which is
the number of shares of Common Stock outstanding
immediately after such event and the denominator
of which is the number of shares of Common Stock
that was outstanding immediately prior to such
event.
(B) The Corporation shall declare a
dividend or distribution on the Series A Preferred
Stock as provided in paragraph (A) of this Section
2 immediately after it declares a dividend or
distribution on the Common Stock ranking on a
parity (either as to dividends or as to amounts
payable upon liquidation, dissolution or winding
up) with the Series A Preferred Stock, except
distributions made ratably on the Series A
Preferred Stock and all such parity stock in
proportion to the total amounts to which the
holders of all such Shares are entitled upon such
liquidation, dissolution or winding up. If the
Corporation shall at any time declare
or pay any dividend on Common Stock payable in
shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding
shares of Common Stock (by reclassification
or otherwise) into a greater or lesser number of
shares of Common Stock, then in each such case the
aggregate amount to which holders of shares of
Series A referred Stock were entitled immediately
prior to such event under the proviso in clause
(1)(b) of the preceding sentence shall be adjusted
by multiplying such amount by a fraction the
numerator of which is the number of shares of
Common Stock outstanding immediately after such
event and the denominator of which is the number
of shares of Common Stock that was outstanding
immediately prior to such event.
Section 7. Consolidation, Merger, etc. If
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 or any other property, or any
combination thereof, then in any such case each
share of Series A Preferred Stock shall at the
same time be similarly exchanged or changed into
an amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 1,000
times the aggregate amount of stock, securities,
cash or any other property (payable in kind), or
any combination thereof, as the case may be, into
which or for which each share of Common Stock is
changed or exchanged. If the Corporation shall at
any time declare or pay any dividend on the Common
Stock payable in shares of Common Stock, or effect
a subdivision or combination or consolidation of
the outstanding shares of Common Stock (by
reclassification or otherwise) into a greater or
lesser number of shares of Common Stock, then in
each such case the amount set forth in the
preceding sentence with respect to the exchange or
change of shares of Series A Preferred Stock shall
be adjusted by multiplying such amount by a
fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately
after such event and the denominator of which is
the number of shares of Common Stock that was
outstanding immediately prior to such event.
Section 8. Redemption. The shares of
Series A Preferred Stock shall not be redeemable.
So long as any shares of Series A Preferred Stock
remain outstanding, the Corporation shall not
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 unless
the Corporation shall substantially concurrently
also purchase or acquire for consideration a
proportionate number of shares of Series A
Preferred Stock.
Section 9. Rank. The Series A Preferred
Stock shall rank, with respect to payment of
dividends and the distribution of assets, junior
to all series of any other class of the
Corporation's Preferred Stock.
Section 10. Amendment. The Certificate of
Incorporation of the Corporation shall not be
amended in any manner which would materially alter
or change the powers, preferences, privileges or
special rights of the Series A Preferred Stock so
as to affect them adversely without the
affirmative vote of the holders of at least two-
thirds of the outstanding shares of Series A
Preferred Stock, voting together as a single
class.
IN WITNESS WHEREOF, this Certificate of
Designation is
executed on behalf of the Corporation by its President,
and
attested by its Secretary, this 26th day of November,
1997.
FORCENERGY INC
ATTEST:_______________________
Thomas F. Getten,
Secretary
By_____________________________
Name: Stig Wennerstrom
Title: President
<PAGE>
EXHIBIT B
FORM OF RIGHT CERTIFICATE
Certificate No. R- _____ Rights
NOT EXERCISABLE AFTER DECEMBER 10 , 2007 OR
EARLIER IF REDEMPTION OR EXCHANGE OCCURS. THE
RIGHTS ARE SUBJECT TO REDEMPTION AT $0.01 PER
RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN
THE RIGHTS AGREEMENT. UNDER CERTAIN CIRCUM
STANCES, RIGHTS BENEFICIALLY OWNED BY ACQUIRING
PERSONS (AS DEFINED IN SECTION 1 OF THE RIGHTS
AGREEMENT) OR ANY SUBSEQUENT HOLDER OF SUCH RIGHTS
MAY BECOME NULL AND VOID.
Right Certificate
Forcenergy Inc
This certifies that _____________________________, or
registered assigns, is the registered owner of the number of
Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of
the Rights Agreement, dated as of November 26, 1997 (the
"Rights Agreement"), between FORCENERGY INC, a Delaware
corporation (the "Company"), and AMERICAN STOCK TRANSFER &
TRUST COMPANY (the "Rights Agent"), to purchase from the
Company at any time after the Distribution Date (as such
term is defined in the Rights Agreement) and prior to 5:00
p.m., New York City time, on December 10 , 2007, at the
Corporate Trust Office of the Rights Agent (or at the office
of its successor as Rights Agent), one one-thousandth
(1/1000) of a fully paid non-assessable share of Series A
Junior Participating Preferred Stock, par value $.01 per
share (the "Preferred Shares"), of the Company, at a
purchase price of $200.00 per one one-thousandth (1/1000) of
a Preferred Share (the "Purchase Price"), upon presentation
and surrender of this Right Certificate with the Form of
Election to Purchase duly executed. The number of Rights
evidenced by this Right Certificate (and the number of one
one-thousandth of a Preferred Share which may be purchased
upon exercise hereof) set forth above, and the Purchase
Price set forth above, are the number and Purchase Price as
of December 10, 1997, based on the Preferred Shares as
constituted at such date. As provided in the Rights
Agreement, the Purchase Price and the number of one one-
thousandth of a Preferred Share which may be purchased upon
the exercise of the Rights evidenced by this Right
Certificate are subject to modification and adjustment upon
that 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. Copies of the Rights Agreement are on file at
the principal executive offices of the Company and the
Corporate Trust Office of the Rights Agent.
This Right Certificate, with or without other Right
Certificates, upon surrender at the Corporate Trust Office
of the Rights Agent, may be exchanged for another Right
Certificate or Right Certificates of like tenor and date
evidencing Rights entitling the holder to purchase a like
aggregate number of Preferred Shares as the Rights evidenced
by the Right Certificate or Right Certificates surrendered
shall have entitled such holder to purchase. If this Right
Certificate shall be exercised in part, the holder shall be
entitled to receive upon surrender hereof another Right
Certificate or Right Certificates for the number of whole
Rights not exercised.
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate (i) may be redeemed by
the Company at a redemption price of $0.01 per Right or
(ii) may be exchanged by the Company in whole or in part for
Preferred Shares or shares of the Company's common stock,
par value $.01 per share.
No fractional Preferred Shares will be issued upon the
exercise of any Right or Rights evidenced hereby (other than
fractions which are integral multiples of one one-thousandth
of a Preferred Share, which may, at the election of the
Company, be evidenced by depositary receipts), but in lieu
thereof a cash payment will be made, as provided in the
Rights Agreement.
No holder of this Right Certificate shall be entitled
to vote or receive dividends or be deemed for any purpose
the holder of the Preferred Shares or of any other
securities of the Company 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 entitled to any
benefit under the Rights Agreement or be valid or obligatory
for any purpose until it shall have been authenticated by
the Right Agent.
WITNESS the facsimile signatures of the proper officers
of the Company and its corporate seal.
Dated ______________________.
FORCENERGY INC
ATTEST:_______________________
Thomas F. Getten,
Secretary
By__________________________________
Name: Stig Wennerstrom
Title: President
Authentication:
This is one of the Right Certificates referred to in
the within-mentioned Rights Agreement.
AMERICAN STOCK TRANSFER & TRUST
COMPANY, as Rights Agent
By__________________________________
Name:
Title:
<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
_________________________________ 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 as of _____________________.
____________________________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the
National Association of Securities Dealers, Inc., or a
commercial bank or trust company having an office or
correspondent n the United States.
[To be executed if statement is correct]
The undersigned hereby certifies that the Rights
evidenced by this Right Certificate are not beneficially
owned by an Acquiring Person or an Affiliate or Associate
thereof (as defined in the Rights Agreement).
____________________________________________
Signature
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise the Right
Certificate)
TO FORCENERGY INC:
The undersigned hereby irrevocably elects to exercise
_____________ Rights represented by this Right Certificate
to purchase the Preferred Shares (or other securities)
issuable upon the exercise of such Rights and requests that
certificates for such Preferred Shares (or other securities)
be issued in the name of: ______________________
____________________________________________________________
__________________________________.
Please insert social security or other identifying number:
____________________________________________
Please print name and address:
____________________________________________
____________________________________________
____________________________________________
If such number of Rights shall not be all the Rights
evidenced by this Right Certificate, a new Right Certificate
for the balance remaining of such Rights shall be registered
in the name of and delivered to: _____________________
____________________________________________________________
__________________________________.
Please insert social security or other identifying number:
____________________________________________
Please print name and address:
____________________________________________
____________________________________________
____________________________________________
Dated as of ___________________.
____________________________________________
Signature
[Form of Reverse Side of Right Certificate - continued]
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a
registered national securities exchange, a member of the
National Association of Securities Dealers, Inc., or a
commercial bank or trust company having an office or
correspondent in the United States.
[To be executed if statement is correct]
The undersigned hereby certifies that the Rights
evidenced by this Right Certificate are not beneficially
owned by an Acquiring Person or an Affiliate or Associate
thereof (as defined in the Rights Agreement).
____________________________________________
Signature
<PAGE>
NOTICE
The signature in the foregoing Form of Assignment or
Form of Election to Purchase must conform to the name as
written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above in the
Form of Assignment or the Form of Election to Purchase, as
the case may be, is not completed, the Company and the
Rights Agent will deem the beneficial owner of the Rights
evidenced by this Right Certificate to be an Acquiring
Person or an Affiliate or Associate thereof (as defined in
the Rights Agreement) and such Assignment or Election to
Purchase will not be honored.
<PAGE>
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE
PREFERRED SHARES
On December 10, 1997, the Board of Directors of
Forcenergy Inc (the "Company"), authorized the issuance of
one preferred share purchase right (a "Right") with respect
to each outstanding share of common stock, $.01 par value
(the "Common Shares"), of the Company. The rights were
issued on December 10, 1997 to the holders of record of
Common Shares on that date. Each Right entitles the
registered holder to purchase from the Company one one-
thousandth of a share of Series A Junior Participating
Preferred Stock, $.01 par value (the "Preferred Shares"), of
the Company at a price of $200.00 per one one-thousandth
(1/1000) of a Preferred Share (the "Purchase Price"),
subject to adjustment. The description and terms of the
Rights are set forth in a Rights Agreement (the "Rights
Agreement") dated as of November 26, 1997, between the
Company and American Stock Transfer & Trust Company, as
Rights Agent (the "Rights Agent").
Detachment of Rights; Exercise. Initially, the Rights
will attach to all Common Share certificates representing
outstanding shares and no separate Right Certificate will be
distributed. The Rights will separate from the Common
Shares and a Distribution Date will occur upon the earlier
of (i) 10 business days following a public announcement that
a person or group of affiliated or associated persons (an
"Acquiring Person") has acquired beneficial ownership of 20%
or more of the outstanding Voting Shares (as defined in the
Rights Agreement) of the Company, or (ii) 10 business days
(unless delayed by the Board of Directors) following the
commencement or announcement of an intention to commence a
tender offer or exchange offer the consummation of which
would result in the beneficial ownership by a person or
group of 20% or more of such outstanding Voting Shares. For
purposes of the definition of an Acquiring Person,
Forcenergy AB or any Successor Entity (as defined in the
Rights Agreement) shall not be deemed to be an Acquiring
Person.
Until the Distribution Date (or earlier redemption or
expiration of the Rights) (i) the Rights will be evidenced,
with respect to any of the Common Shares outstanding on
December 10, 1997, by the certificates representing such
Common Shares with a copy of this Summary of Rights attached
thereto, (ii) the Rights will be transferred with and only
with the Common Shares, (iii) new Common Share certificates
issued after December 10, 1997, upon transfer or new
issuance of the Common Shares will contain a notation
incorporating the Rights Agreement by reference, and (iv)
the surrender for transfer of any certificates for Common
Shares outstanding as of December 10, 1997, even without
such notation or a copy of this Summary of Rights being
attached thereto, will also constitute the transfer of the
Rights associated with the Common Shares represented by such
certificate.
As soon as practicable following the Distribution Date,
separate certificates evidencing the Rights (the "Right
Certificates") will be mailed to holders of record of the
Common Shares as of the close of business on the
Distribution Date and such separate Right Certificates alone
will thereafter evidence the Rights.
The Rights are not exercisable until the Distribution
Date. The Rights will expire on December 10, 2007 (the
"Final Expiration Date"), unless the Final Expiration Date
is extended or the Rights are earlier redeemed or exchanged
by the Company as described below.
If a person or group were to acquire 20% or more of the
Voting Shares of the Company, each Right then outstanding
(other than Rights beneficially owned by the Acquiring
Person which would become null and void) would become a
right to buy that number of Common Shares (or under certain
circumstances, the equivalent number of one one-thousandth
of a Preferred Share) that at the time of such acquisition
would have a market value of two times the Purchase Price of
the Right.
If the Company were acquired in a merger or other
business combination transaction or more than 50% of its
consolidated assets or earning power were sold, proper
provision will be made so that each holder of a Right will
thereafter have the right to receive, upon the exercise
thereof at the then current Purchase Price of the Right,
that number of shares of common stock of the acquiring
company which at the time of such transaction would have a
market value of two times the Purchase Price of the Right.
Preferred Shares. The dividend and liquidation rights,
and the non-redemption feature, of the Preferred Shares are
designed so that the value of one one-thousandth of a
Preferred Share purchasable upon exercise of each Right will
approximate the value of one Common Share. The Preferred
Shares issuable upon exercise of the Rights will be
non-redeemable and rank junior to all other series of the
Company's preferred stock. Each whole Preferred Share will
be entitled to receive a quarterly preferential dividend in
an amount per share equal to the greater of (i) $1.00 in
cash, or (ii) in the aggregate, 1,000 times the dividend
declared on the Common Shares. In the event of liquidation,
the holders of the Preferred Shares will be entitled to
receive a preferential liquidation payment equal to the
greater of (i) $1,000 per share, or (ii) in the aggregate,
1,000 times the payment made on the Common Shares. In the
event of any merger, consolidation or other transaction in
which Common Shares are exchanged for or changed into other
stock or securities, cash or other property, each whole
Preferred Share will be entitled to receive 1,000 times the
amount received per Common Share. Each whole Preferred
Share shall be entitled to 1,000 votes on all matters
submitted to a vote of the stockholders of the Company, and
Preferred Shares shall generally vote together as one class
with the Common Stock and any other capital stock on all
matters submitted to a vote of stockholders of the Company.
The offer and sale of the Preferred Shares issuable
upon exercise of the Rights will be registered with the
Securities and Exchange Commission and such registration
will not be effective until the Rights become exercisable.
Antidilution and Other Adjustments. The number of one
one-thousandth of a Preferred Share or other securities or
property issuable upon exercise of the Rights, and the
Purchase Price payable, are subject to customary adjustments
from time to time to prevent dilution.
The number of outstanding Rights and the number of one
one-thousandth of a Preferred Share issuable upon exercise
of each Right are also subject to adjustment in the event of
a stock split of the Common Shares or a stock dividend on
the Common Shares payable in Common Shares or subdivisions,
consolidations or combinations of the Common Shares
occurring, in any such case, prior to the Distribution Date.
Exchange Option. At any time after the acquisition by
a person or group of affiliated or associated persons
(other than Forcenergy AB or any Successor Entity) of
beneficial ownership of 20% or more of the
outstanding Voting Shares of the Company and before the
acquisition by a person or group of 50% or more of the
outstanding Voting Shares of the Company, the Board of
Directors may, at its option, issue Common Shares in
mandatory redemption of, and in exchange for, all or part
of the then outstanding and exercisable Rights (other
than Rights owned by such person or group which would
become null and void) at an exchange ratio of one Common
Share (or one one-thousandth of a Preferred Share)
for each Right, subject to adjustment.
Redemption of Rights. At any time prior to the first
public announcement that a person or group (other
than Forcenergy AB or any Successor Entity) has become the
beneficial owner of 20% or more of the outstanding Voting
Shares, the Board of Directors of the Company may redeem all
but not less than all the then outstanding Rights at a price
of $0.01 per Right (the "Redemption Price"). The redemption
of the Rights may be made effective at such time, on such
basis and with such conditions as the Board of Directors in
its sole discretion may establish. Immediately upon the
action of the Board of Directors ordering redemption of the
Rights, the right to exercise the Rights will terminate and
the only right of the holders of Rights will be to receive
the Redemption Price.
No Rights as Stockholder. Until a Right is exercised,
the holder thereof, as such, will have no rights as a
stockholder of the Company, including, without limitation,
the right to vote or to receive dividends.
Amendment of Rights. The terms of the Rights may be
amended by the Board of Directors of the Company without the
consent of the holders of the Rights, including an amendment
to extend the Final Expiration Date or to exempt particular
transactions, and, provided a Distribution Date has not
occurred, to extend the period during which the Rights may
be redeemed, except that after the first public announcement
that a person or group (other than Forcenergy AB or
any Successor Entity) has become the beneficial owner of
20% or more of the outstanding Voting Shares, no such
amendment may materially and adversely affect the interests
of the holders of the Rights.
THIS SUMMARY DESCRIPTION OF THE RIGHTS DOES NOT PURPORT
TO BE COMPLETE AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO THE RIGHTS AGREEMENT, WHICH IS HEREBY INCORPORATED HEREIN
BY REFERENCE.
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an Exhibit to a
Registration Statement on Form 8-A dated December 4,
1997, as amended on December 9, 1997. A copy of the Rights
Agreement is available free of charge from the Company.
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.
FORCENERGY INC
Date: December 9, 1997
By: ________________________
Name: E. Joseph Grady
Title: Vice President - Chief Financial Officer
