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Exhibit 4.1
AMENDMENT NO. 2 TO RIGHTS AGREEMENT
This Amendment No. 2 ("Amendment No. 2") to that certain rights
agreement, dated as of September 25, 1995, as amended on June 17, 1998, by and
between Investors Financial Services Corp., a Delaware corporation (the
"Company"), and First Chicago Trust Company of New York, as rights agent (the
"Rights Agent") (as amended, the "Rights Agreement"), is made and entered into
as of this 15th day of August, 2000 by the Company and the Rights Agent.
Capitalized terms not defined herein shall have the respective meaning ascribed
to them in the Rights Agreement.
In accordance with Section 27 (Supplements and Amendments) of the
Rights Agreement, the Company hereby amends the Rights Agreement as follows:
1. Effective immediately, the Rights Agreement is hereby amended by
replacing Section 1(y) thereof in its entirety with the following:
"`INITIAL EXERCISE PRICE' shall be $540.00"
2. Effective immediately, Exhibit B (Form of Rights Certificate) to the
Rights Agreement is hereby amended and restated in its entirety by EXHIBIT I
hereto.
3. Effective immediately, Exhibit C (Summary of Rights to Purchase
Preferred Stock) to the Rights Agreement is hereby amended and restated in its
entirety by EXHIBIT II hereto.
4. Except as specifically amended and set forth herein, the Rights
Agreement shall remain unchanged and in full force and effect in accordance with
its terms.
5. By execution of this Amendment No. 2, the Company hereby certifies
to the Rights Agent that the amendments to the Rights Agreement reflected herein
comply with Section 27 (Supplements and Amendments) of the Rights Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2
to be executed and delivered as of the date first written above.
INVESTORS FINANCIAL SERVICES CORP.
By: /s/ Kevin J. Sheehan
----------------------------------
Name: Kevin J. Sheehan
Title: President, Chief Executive Officer
and Chairman
FIRST CHICAGO TRUST COMPANY OF
NEW YORK
By: /s/ Gerald J. O'Leary
----------------------------------
Name: Gerald J. O'Leary
Title: Managing Director
<PAGE>
EXHIBIT I
EXHIBIT B
[FORM OF RIGHTS CERTIFICATE]
Certificate No. R- __________ Rights
NOT EXERCISABLE AFTER AUGUST 15, 2005 OR EARLIER IF REDEEMED BY THE COMPANY. THE
RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $.01 PER
RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON, AN ADVERSE
PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON OR AN ADVERSE PERSON
(AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF
SUCH RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHTS
CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN
ACQUIRING PERSON, AN ADVERSE PERSON OR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING
PERSON OR ADVERSE PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT).
ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY
BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF SUCH
AGREEMENT.]*
Rights Certificate
INVESTORS FINANCIAL SERVICES CORP.
This Rights Certificate certifies that _____________________, or
registered assigns, is the registered holder of the number of Rights set forth
above, each of which whole Right entitles the holder thereof, subject to the
terms, provisions and conditions of the Rights Agreement, dated as of September
25, 1995, and as subsequently amended on June 17, 1998 and August 15, 2000 (as
amended, the "Rights Agreement"), between Investors Financial Services Corp., a
Delaware corporation (the "Company"), and First Chicago Trust Company of New
York (the "Rights Agent"), to purchase from the Company after the Distribution
Date (as such term is defined in the Rights Agreement) and at any time prior to
the Expiration Date (as such term is defined in the Rights Agreement) at the
office or offices of the Rights Agent designated for such purpose, or its
successors as Rights Agent, _____________________
* If applicable, insert this portion of the legend and delete preceding
sentence.
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one-hundredth of a fully paid, non-assessable share of Series A Junior
Participating Preferred Stock (the "Preferred Stock") of the Company, at a
purchase price of $540.00 per one one-hundredth of a share (the "Purchase
Price"), upon presentation and surrender of this Rights Certificate with the
Form of Election to Purchase and related Certificate duly executed. The number
of Rights evidenced by this Rights Certificate (and the number of shares which
may be purchased upon exercise thereof) set forth above, and the Purchase Price
per share set forth above, are the number and Purchase Price as of [the Record
Date] based on the Preferred Stock as constituted at such date. The Company
reserves the right to require prior to the occurrence of a Triggering Event (as
such term is defined in the Rights Agreement) that a number of Rights be
exercised so that only whole shares of Preferred Stock will be issued.
Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Rights Agreement.
Upon the occurrence of a Section 11(a)(ii) Event, if the Rights
evidenced by this Rights Certificate are beneficially owned by (i) an Acquiring
Person, an Adverse Person or an Affiliate or Associate of an Acquiring Person or
Adverse Person, (ii) a transferee of an Acquiring Person or an Adverse Person
(or of any such Associate or Affiliate of an Acquiring Person or an Adverse
Person), or (iii) under certain circumstances specified in the Rights Agreement,
a transferee of a person who, after such transfer, became an Acquiring Person or
an Adverse Person (or an Associate or Affiliate of an Acquiring Person or an
Adverse Person), such Rights shall become null and void and no holder hereof
shall have any right with respect to such Rights from and after the occurrence
of such Section 11(a)(ii) Event.
As provided in the Rights Agreement, the Purchase Price and the number
and kind of shares of Preferred Stock or other securities which may be purchased
upon the exercise of the Rights evidenced by this Rights Certificate are subject
to modification and adjustment upon the happening of certain events, including
Triggering Events.
This Rights 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 Rights Certificates, which
limitations of rights include the temporary suspension of the exercisability of
such Rights under the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the office of the Company and are
also available upon written request to the Company.
This Rights Certificate, with or without other Rights Certificates,
upon surrender at the principal office or offices of the Rights Agent designated
for such purpose, may be exchanged for another Rights Certificate or Rights
Certificates of like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of one one-hundredths of a share of Preferred
Stock as the Rights evidenced by the Rights Certificate or Rights Certificates
surrendered shall have entitled such holder to purchase. If this Rights
Certificate shall be
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exercised in part, the holder shall be entitled to receive upon surrender hereof
another Rights Certificate or Rights Certificates for the number of whole Rights
not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Certificate may be redeemed by the Company at its option at a redemption
price of $.01 per Right (such number reflecting the stock splits in the form of
a dividend effected by the Company in March 1999 and June 2000) at any time
prior to the earlier of (i) the close of business on the tenth day following the
Stock Acquisition Date (or, if the Stock Acquisition Date shall have occurred
prior to the Record Date, the close of business on the tenth day following the
Record Date), and (ii) the Final Expiration Date. After the expiration of the
redemption period, the Company's right of redemption may be reinstated if an
Acquiring Person reduces his beneficial ownership to 15% or less of the
outstanding shares of Common Stock in a transaction or series of transactions
not involving the Company.
No fractional shares of Preferred Stock will be issued upon the
exercise of any Right or Rights evidenced hereby (other than fractions which are
integral-multiples of one one-hundredth of a share of Preferred Stock), but in
lieu thereof a cash payment will be made, as provided in the Rights Agreement.
No holder of this Rights Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of shares of Preferred
Stock 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 Rights
Certificate shall have been exercised as provided in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
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IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal by its authorized officers.
Dated:
ATTEST: INVESTORS FINANCIAL SERVICES CORP.
__________________________ By:___________________________
Secretary Kevin J. Sheehan
President and Chief
Executive Officer
Countersigned:
By:________________________
Authorized Signature
<PAGE>
[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Rights Certificate.)
FOR VALUE RECEIVED ________________________________________________________
hereby sells, assigns and transfers unto
___________________________________________________________________________
___________________________________________________________________________
(Please print name and address of transferee)
this Rights Certificate, together with all right, title and interest therein,
and does hereby irrevocably constitute and appoint Attorney, to transfer the
within Rights Certificate on the books of the within-named Company, with full
power of substitution.
Dated:
___________________________
Signature
Signature Guaranteed:
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CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) this Rights Certificate [ ] is [ ] is not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person, an
Adverse Person or an Affiliate or Associate of an Acquiring Person or an Adverse
Person (as such terms are defined in the Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Rights Certificate from
any Person who is, was or subsequently became an Acquiring Person, an Adverse
Person or an Affiliate or Associate of an Acquiring Person or an Adverse Person.
Dated:
_________________________________
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Assignment and Certificate must
correspond to the name as written upon the face of this Rights Certificate in
every particular, without alteration or enlargement or any change whatsoever.
<PAGE>
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise Rights represented by the
Rights Certificate.)
To: INVESTORS FINANCIAL SERVICES CORP.:
The undersigned hereby irrevocably elects to exercise ______ Rights
represented by this Rights Certificate to purchase the shares of Preferred Stock
issuable upon the exercise of the Rights (or such other securities of the
Company or of any other person which may be issuable upon the exercise of the
Rights) and requests that certificates for such shares be issued in the name of
and delivered to:
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
Rights Certificate, a new Rights Certificate for the balance 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:
______________________________
Signature
Signature Guaranteed:
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CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Rights Certificate [ ] are [ ] are not
being exercised by or on behalf of a Person who is or was an Acquiring Person,
an Adverse Person or an Affiliate or Associate of an Acquiring Person or an
Adverse Person (as such terms are defined in the Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Rights Certificate from
any Person who is, was or subsequently became an Acquiring Person, an Adverse
Person or an Affiliate or Associate of an Acquiring Person or an Adverse Person.
Dated:
______________________________
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Election to Purchase and Certificate
must correspond to the name as written upon the face of this Rights Certificate
in every particular, without alteration or enlargement or any change whatsoever.
<PAGE>
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EXHIBIT II
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE PREFERRED STOCK
On August 15, 1995, the Board of Directors of Investors Financial Services
Corp. (the "Company") declared a dividend of one preferred stock purchase right
(a "Right") for each outstanding share of the Company's Common Stock and Class A
Stock (all issued and outstanding shares of which were converted on September
19, 1997 to shares of Common Stock) to stockholders of record at the close of
business on the day preceding the date on which the Company acquired all the
issued and outstanding capital stock of Investors Bank & Trust Company in
exchange for Common Stock (the "Record Date"). Giving effect to the two stock
splits in the form of a dividend completed by the Company in March 1999 and June
2000, respectively, each share of Common Stock now trades with one-quarter of a
Right attached to it. Each whole Right entitles the registered holder to
purchase from the Company a unit consisting of one one-hundredth of a share (a
"Unit") of Series A Junior Participating Preferred Stock, $.01 par value per
share (the "Preferred Stock"), at a purchase price of $540 per Unit (the
"Purchase Price"), subject to adjustment. The description and terms of the
Rights are set forth in a Rights Agreement, dated September 25, 1995, and as
subsequently amended on June 17, 1998 by Amendment No. 1 and on August 15, 2000
by Amendment No. 2 thereto (as amended, the "Rights Agreement") between the
Company and First Chicago Trust Company of New York, as Rights Agent.
The Rights are attached to all Common Stock certificates representing
shares then outstanding, and no separate Rights Certificates have been
distributed as of the date hereof. The Rights will separate from the Common
Stock and a Distribution Date will occur upon the earlier of (i) 10 days
following a public announcement by the Company or any Person that such Person or
group of affiliated or associated Persons, other than the Company, any
Subsidiary of the Company, or any Person or entity organized, appointed or
established by the Company for or pursuant to the terms of the Company's benefit
plan (an "Acquiring Person") has acquired, or obtained the right to acquire,
beneficial ownership of more than 15% of the outstanding shares of Common Stock
(the "Stock Acquisition Date"), (ii) 10 business days following the commencement
of a tender offer or exchange offer that may result in a person or group, other
than the Company, any Subsidiary of the Company, or any Person or entity
organized, appointed or established by the Company for or pursuant to the terms
of such plan, beneficially owning 15% or more of such outstanding shares of
Common Stock, or (iii) 10 business days following an Adverse Person Event (as
defined below).
Until the Distribution Date (or earlier redemption or expiration of the
Rights), (i) the Rights will be evidenced by the Common Stock certificates and
will be transferred with and only with such Common Stock certificates, (ii) new
Common Stock certificates issued after the Record Date will contain a notation
incorporating the Rights Agreement by reference and (iii) the
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surrender for transfer of any certificates for Common Stock outstanding, even
without such notation, will also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate. Pursuant to
the Rights Agreement, the Company reserves the right to require prior to the
occurrence of a Triggering Event (as defined below) that, upon any exercise of
Rights, a number of Rights may be exercised so that only whole shares of
Preferred Stock will be issued.
The Rights are not exercisable until the Distribution Date and will expire
at the Close of Business on August 15, 2005, unless earlier redeemed by the
Company as described below.
As soon as practicable after the Distribution Date, separate certificates
evidencing the Rights ("Rights Certificates") will be mailed to holders of
record of the Common Stock as of the close of business on the Distribution Date
and, thereafter, such separate Rights Certificates alone will represent the
Rights. Except as otherwise determined by the Board of Directors and except in
connection with shares of Common Stock issued upon the exercise of employee
stock options, issuances under other employee stock benefit plans or upon the
conversion of convertible securities issued hereafter, only shares of Common
Stock issued prior to the Distribution Date will be issued with Rights.
If at any time following the Distribution Date, (i) the Company is the
surviving corporation in a merger with an Acquiring Person and its Common Stock
is not changed or exchanged, (ii) 10 business days after a Person or group of
affiliated or associated Persons other than the Company or its affiliates and
associates acquires beneficial ownership of 20% of the outstanding Common Stock
of the Company (except pursuant to an offer for all outstanding shares of Common
Stock which the Independent Directors determine to be fair to, and otherwise in
the best interests of, the Company and its stockholders), (iii) an Acquiring
Person engages in one or more "self-dealing" transactions as set forth in the
Rights Agreement, (iv) during such time as there is an Acquiring Person, an
event occurs which results in such Acquiring Person's ownership interest being
increased by more than 1% (E.G., a reverse stock split), or (v) 10 business days
after the Directors of the Company shall declare any Person to be an Adverse
Person, upon a determination that such Person, alone or together with its
affiliates and associates, has become the Beneficial Owner of an amount of
Common Stock which the Directors determine to be substantial (which amount shall
in no event be less than 10% of the shares of Common Stock then outstanding) and
a majority of the Directors (with the concurrence of a majority of the
Independent Directors (as defined below)) determines, after reasonable inquiry
and investigation, including consultation with such persons as such directors
shall deem appropriate, that (a) such beneficial ownership by such person is
intended to cause the Company to repurchase the Common Stock beneficially owned
by such person or to cause pressure on the Company to take action or enter into
a transaction or series of transactions intended to provide such person with
short-term financial gain under circumstances where such directors determine
that the best long-term interests of the Company and its stockholders would not
be served by taking such action or entering into such transaction or series of
transactions at that time or (b) such beneficial ownership is causing or is
reasonably likely to cause a material adverse impact on the business or prospect
of the Company (including, but not limited to, impairment of relationships with
customers, impairment of the Company's ability to maintain its competitive
<PAGE>
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position or impairment of the Company's business reputation or ability to deal
with government agencies or meet regulatory requirements an "Adverse Person
Event").
Then, each holder of a Right will thereafter have the right to receive,
upon exercise, that number of shares of Common Stock (or, in certain
circumstances, cash, property or other securities of the Company) which equals
the exercise price of the Right divided by 50% of the current market price (as
defined in the Rights Agreement) of the Common Stock at the date of the
occurrence of the event. However, Rights are not exercisable following the
occurrence of any of the events set forth above until such time as the Rights
are no longer redeemable by the Company as set forth below. Notwithstanding any
of the foregoing, following the occurrence of any of the events set forth in the
above paragraph, all Rights that are, or (under certain circumstances specified
in the Rights Agreement) were, beneficially owned by an Acquiring Person or an
Adverse Person will be null and void. The events set forth in the above
paragraph are referred to as "Section 11(a)(ii) Events."
For example, at an exercise price of $540 per whole Right, each whole
Right not owned by an Acquiring Person or an Adverse Person (or by certain
related parties) following an event set forth in the preceding paragraph would
entitle its holder to purchase $1,080 worth of Common Stock (or other
consideration, as noted above) for $540. Assuming that the Common Stock has a
per share value of $30 at such time, the holder of each valid whole Right would
be entitled to purchase 36 shares of Common Stock for $540.
In the event that, at any time following the Stock Acquisition Date, (i)
the Company is acquired in a merger or other business combination transaction in
which the Company is not the surviving corporation (other than a merger which
follows an offer determined by the Board of Directors to be fair as described in
clause (ii) of the second preceding paragraph), or (ii) more than 50% of the
Company's assets or earning power is sold or transferred, each holder of a Right
(except Rights which previously have been voided as set forth above) shall
thereafter have the right to receive, upon exercise, that number of shares of
common stock of the acquiring company which equals the exercise price of the
Right divided by one-half of the current market price (as defined in the Rights
Agreement) of such common stock at the date of the occurrence of the event. The
events set forth in this paragraph and in the third preceding paragraph are
referred to as the "Triggering Events."
At any time after the occurrence of a Section 11(a)(ii) Event, a majority
of the Directors may exchange the Rights (other than Rights owned by an
Acquiring Person or Adverse Person which have become void), in whole or in part,
at an exchange ratio of four shares of Common Stock, or four Common Stock
Equivalents (as defined in the Rights Agreement), per whole Right (subject to
adjustment).
The Purchase Price payable, and the number of Units of Preferred Stock or
other securities or property issuable, upon exercise of the Rights are subject
to adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Preferred
Stock, (ii) if holders of the Preferred Stock are granted certain rights or
warrants to subscribe for Preferred Stock or convertible securities at less than
the
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current market price of the Preferred Stock, or (iii) upon the distribution to
holders of the Preferred Stock of evidences of indebtedness or assets (excluding
regular quarterly cash dividends) or of subscription rights or warrants (other
than those referred to above).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments amount to at least 1% of the Purchase
Price. No fractional Units will be issued and, in lieu thereof, an adjustment in
cash will be made based on the market price of the Preferred Stock on the last
trading date prior to the date of exercise.
In general, the Company may redeem the Rights in whole, but not in part,
at any time until ten days following the Stock Acquisition Date, at a price of
$.01 per Right (payable in cash, Common Stock or other consideration deemed
appropriate by the Board of Directors). Under certain circumstances set forth in
the Rights Agreement, the decision to redeem shall require the concurrence of a
majority of the Directors. The Company may not redeem the Rights if the
Directors have previously declared a person to be an Adverse Person. After the
redemption period has expired, the Company's right of redemption may be
reinstated if either (i) an Acquiring Person reduces its beneficial ownership to
less than 15% of the outstanding shares of Common Stock in a transaction or a
series of transactions not involving the Company, or (ii) the Board of Directors
approves the merger of the Company with, or acquisition of the Company by, a
Person unrelated to the Acquiring Person. Immediately upon the action of the
Board of Directors ordering redemption of the Rights, with, where required, the
concurrence of the Directors, the Rights will terminate and the only right of
the holders of Rights will be to receive the $.01 per Right redemption price.
The term "Independent Directors" means Directors who are not officers of
the Company.
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. While the distribution of the Rights will not
be taxable to stockholders or to the Company, stockholders may, depending upon
the circumstances, recognize taxable income in the event that the Rights become
exercisable for Common Stock (or other consideration) of the Company or for
common stock of the acquiring company as set forth above.
Other than those provisions relating to the principal economic terms of
the Rights, any of the provisions of the Rights Agreement may be amended by the
Board of Directors of the Company prior to the earlier to occur of the
determination that a person is an Adverse Person or the Distribution Date. After
the earlier of such events, the provisions of the Rights Agreement may be
amended by the Board of Directors (in certain circumstances, with the
concurrence of the Directors) in order to cure any ambiguity, to make changes
which do not adversely affect the interests of holders of Rights (excluding the
interests of any Acquiring Person or any Adverse Person), or to shorten or
lengthen any time period under the Rights Agreement; PROVIDED, HOWEVER, that no
amendment to adjust the time period governing redemption shall be made at such
time as the Rights are not redeemable.
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A copy of the Rights Agreement is available free of charge from the
Company. This summary description of the Rights does not purport to be complete
and is qualified in its entirety by reference to the Rights Agreement, which is
incorporated herein by reference.
