[Irell & Manella Letterhead]
(213) 229-0594
January 5, 1995
VIA EDGAR
Securities and Exchange Commission
450 - 5th Street, N.W.
Washington, D.C. 20549
Re: Teledyne, Inc. ("Teledyne")
Commission File No. 1-5212
Gentlemen:
Enclosed for filing pursuant to Section 12(b) of the Securities Exchange
Act of 1934, as amended, is one complete copy of a Form 8-A Registration
Statement (the "Form 8-A") of Teledyne relating to certain share purchase rights
(the "Rights") to be issued to Teledyne's shareholders as of the close of
business on January 27, 1995 as a dividend. The filing fee of $250.00 has been
paid as provided in the EDGAR rules.
Please note that accelerated effectiveness of this Registration Statement
is requested to occur before the above-mentioned dividend record date. In that
regard, under separate cover we are furnishing, for the supplemental
information of the staff, our firm's legal opinion as required by the
Response of the Office of Chief Counsel and the Office of Tender Offers,
Division of Corporate Finance, Registration of Rights Issuable Pursuant to
Stockholder Rights Plans (Jan. 7, 1987).
Listing applications for the Rights are concurrently herewith being filed
with the New York and Pacific Stock Exchange, on which Teledyne's common stock
is listed. The Rights will initially trade only as an integral feature of the
common stock.
Sincerely,
Henry Lesser
HL:rng
Enclosures
cc: New York Stock Exchange
Pacific Stock Exchange
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
TELEDYNE, INC.
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(Exact name of registrant as specified in its charter)
Delaware 95-2282626
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(State of incorporation or organization) (I.R.S. Employer Identification No.)
1901 Avenue of the Stars
Los Angeles, California 90067-6046
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(Address of principal executive offices and zip code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
------------------- ------------------------------
Preferred Share Repurchase New York Stock Exchange
Rights Pursuant to Rights Pacific Stock Exchange
Agreement
Securities to be registered pursuant to Section 12(g) of the Act:
Not Applicable
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(Title of Class)
<PAGE>
Item 1. Description of Securities to be Registered.
On January 4, 1995 (the "Effective Date"), the Board of
Directors (the "Board") of Teledyne, Inc. (the "Corporation")
declared a dividend distribution of one preferred share
purchase right (a "Right") for each outstanding share of
Common Stock, par value $1.00 per share (the "Common Shares"),
of the Corporation. The dividend is payable to the
stockholders of record on January 27, 1995 (the "Record
Date"), and with respect to Common Shares issued thereafter
until the Distribution Date (as defined below) and, in certain
circumstances, with respect to Common Shares issued after the
Distribution Date. Except as set forth below, each Right,
when it becomes exercisable, entitles the registered holder to
purchase from the Corporation one one-thousandth (1/1000th) of
a share of Series D Preferred Stock, $1.00 par value per share
(the "Preferred Shares"), of the Corporation at a price of $75.00
per one one-thousandth (1/1000th) of a Preferred Share (the
"Purchase Price"), subject to adjustment. The description and
terms of the Rights are set forth in a Rights Agreement (the
"Rights Agreement") between the Corporation and Chemical Trust
Company of California, as Rights Agent (the "Rights Agent"),
dated as of January 4, 1995.
Initially, the Rights will be attached to all
certificates representing Common Shares then outstanding, and
no separate Right Certificates will be distributed. The
Rights will separate from the Common Shares upon the earlier
to occur of (i) a person or group of affiliated or associated
persons having acquired, without the prior approval of the
Corporation's Board of Directors, beneficial ownership of 15%
or more of the outstanding Common Shares (except pursuant to a
Permitted Offer, as hereinafter defined); or (ii) 10 days (or
such later date as the Board may determine) following the
commencement of, or announcement of an intention to make, a
tender offer or exchange offer the consummation of which would
result in a person or group of affiliated or associated
persons becoming an Acquiring Person (as hereinafter defined)
(the "Distribution Date"). A person or group whose
acquisitions of Common Shares cause a Distribution Date
pursuant to clause (i) above is an "Acquiring Person," with
certain exceptions as set forth in the Rights Agreement. The
date that a person or group is first publicly announced to
have become such by the Corporation or such Acquiring Person
is the "Shares Acquisition Date."
The Rights Agreement provides that, until the
Distribution Date, the Rights will be transferred with and
only with the Common Shares. Until the Distribution Date (or
earlier redemption or expiration of the Rights), new Common
Share certificates issued after the Record Date upon transfer
or new issuance of Common Shares will contain a notation
incorporating the Rights Agreement by reference. Until the
Distribution Date (or earlier redemption or expiration of the
<PAGE>
Rights), the surrender for transfer of any certificates for
Common Shares outstanding as of the Record Date, even without
attaching thereto such notation or a copy of the Summary of
Rights attached to the Rights Agreement as Exhibit C, will
also constitute the transfer of the Rights associated with the
Common Shares represented by such certificate. As soon as
practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will
be mailed to the holders of record of the Common Shares as of
the Close of Business (as defined in the Rights Agreement) on
the Distribution Date (and to each initial record holder of
certain Common Shares issued after the Distribution Date), and
such separate Right Certificates alone will evidence the
Rights.
The Rights are not exercisable until the Distribution
Date and will expire at the Close of Business on January 4,
2005, unless earlier redeemed by the Corporation as described
below.
In the event that any person becomes an Acquiring Person
(except pursuant to a tender or exchange offer which is for
all outstanding Common Shares at a price and on terms which a
majority of certain members of the Board determines to be
adequate and in the best interests of the Corporation, its
stockholders and other relevant constituencies, other than
such Acquiring Person, its affiliates and associates (a
"Permitted Offer")), each holder of a Right will thereafter
have the right (the "Flip-In Right") to receive upon exercise
the number of Common Shares (or, in certain circumstances, of
one one-thousandths (1/1000ths) of a Preferred Share or other
securities of the Corporation) having a value (immediately
prior to such triggering event) equal to two times the
exercise price of the Right. Notwithstanding the foregoing,
following the occurrence of the event described above, all
Rights that are, or (under certain circumstances specified in
the Rights Agreement) were, beneficially owned by any
Acquiring Person or any affiliate or associate thereof will be
null and void. The Board has the option, at any time after
any person becomes an Acquiring Person, to exchange all or
part of the then-exercisable Rights (excluding those that have
become void, as described in the immediately preceding
sentence) for Common Shares, at an exchange ratio determined
by dividing the then-applicable Purchase Price by the then-
current market price per Common Share as determined in
accordance with the Rights Agreement. However, this option
generally terminates if any person becomes the beneficial
owner of 50% or more of the Common Shares.
In the event that, at any time following the Shares
Acquisition Date, (i) the Corporation is acquired in a merger
or other business combination transaction in which the holders
of all of the outstanding Common Shares immediately prior to
the consummation of the transaction are not the holders of all
<PAGE>
of the surviving corporation's voting power, or (ii) more than
50% of the Corporation's assets or earning power is sold or
transferred, in either case with or to an Acquiring Person or
any affiliate or associate thereof or any other person in
which such Acquiring Person, affiliate or associate has an
interest or any person acting on behalf of or in concert with
such Acquiring Person, affiliate or associate, or if, in such
transaction, all holders of Common Shares are not treated
alike, any other person, then each holder of a Right (except
Rights which previously have been voided as set forth above)
shall thereafter have the right (the "Flip-Over Right") to
receive, upon exercise, common shares of the acquiring company
having a value equal to two times the exercise price of the
Right. The holder of a Right will continue to have the Flip-
Over Right whether or not such holder exercises or surrenders
the Flip-In Right.
The Purchase Price payable, and the number of Preferred
Shares, Common Shares or other securities issuable, upon
exercise of the Rights are subject to adjustment from time to
time to prevent dilution (i) in the event of a stock dividend
on, or a subdivision, combination or reclassification of, the
Preferred Shares, (ii) upon the grant to holders of the
Preferred Shares of certain rights or warrants to subscribe
for or purchase Preferred Shares at a price, or securities
convertible into Preferred Shares with a conversion price,
less than the then current market price of the Preferred
Shares or (iii) upon the distribution to holders of the
Preferred Shares of evidences of indebtedness or assets
(excluding regular quarterly cash dividends) or of
subscription rights or warrants (other than those referred to
above).
The number of outstanding Rights and the number of the
one-thousandths (1/1000ths) 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.
With certain exceptions, no adjustment in the Purchase
Price will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price.
At any time prior to the earlier to occur of (i) a person
becoming an Acquiring Person or (ii) the expiration of the
Rights, and under certain other circumstances, the Corporation
may redeem the Rights in whole, but not in part, at a price
(payable in cash or, at the Corporation's election, in Common
Shares) of $.01 per Right (the "Redemption Price"), which
redemption shall be effective upon the action of the Board.
Additionally, following the Shares Acquisition Date, the
<PAGE>
Corporation may redeem the then outstanding Rights in whole,
but not in part, at the Redemption Price, provided that such
redemption is in connection with a merger or other business
combination transaction or series of transactions involving
the Corporation in which all holders of Common Shares are
treated alike but not involving an Acquiring Person or its
affiliates or associates.
All of the provisions of the Rights Agreement may be
amended by the Board of Directors of the Corporation prior to
the Distribution Date. After the Distribution Date, the
provisions of the Rights Agreement may be amended by the Board
in order to cure any ambiguity, defect or inconsistency, to
make changes that do not adversely affect the interests of
holders of Rights (excluding the interests of any Acquiring
Person), or, subject to certain limitations, to shorten or
lengthen any time period under the Rights Agreement.
Until a Right is exercised, the holder thereof, as such,
will have no rights as a stockholder of the Corporation,
including, without limitation, the right to vote or to receive
dividends. While the distribution of the Rights will not be
taxable to stockholders of the Corporation, stockholders may,
depending upon the circumstances, recognize taxable income
should the Rights become exercisable or upon the occurrence of
certain events thereafter.
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.
As of December 31, 1994, there were 55,462,298 Common
Shares outstanding (as well as a further 7,481,640 shares
reserved for issuance pursuant to an employee stock purchase
plan and upon exercise of stock options, of which 3,281,375
were reserved with respect to options outstanding on that date).
Each Common Share outstanding on the Record Date will receive one
Right. As long as the Rights are attached to the Common Shares,
the Corporation will issue one Right with each new Common Share
so that all such shares will have attached rights.
The Rights have certain anti-takeover effects. The
Rights will cause substantial dilution to a person or group
that attempts to acquire the Corporation without conditioning
the offer on the Rights being redeemed or a substantial number
of Rights being acquired. However, the Rights should not
interfere with any tender offer or merger approved by the
Corporation (other than with an Acquiring Person) because the
Rights do not become exercisable in the event of a Permitted
Offer or other acquisition exempted by the Company's Board.
Attached hereto as Exhibit 1 and incorporated herein by
reference are copies of the Rights Agreement and the exhibits
<PAGE>
thereto, as follows: Exhibit A -- Form of Certificate of
Designation, Preferences and Rights of Series D Preferred
Stock of Teledyne, Inc.; Exhibit B -- Form of Right
Certificate; and Exhibit C -- Summary of Rights to Purchase
Series D Preferred Stock. The foregoing description of the
Rights is qualified in its entirety by reference to the Rights
Agreement and such exhibits thereto.
Item 2. Exhibits.
1. Rights Agreement, dated as of January 4, 1995,
between Teledyne, Inc. and Chemical Trust Company of
California as Rights Agent, which includes: as
Exhibit A thereto, the Form of Certificate of
Designation, Preferences and Rights of Series D
Preferred Stock of Teledyne, Inc.; as Exhibit B
thereto, the Form of Right Certificate; and, as
Exhibit C thereto, the Summary of Rights to Purchase
Series D Preferred Stock.
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the
Securities Exchange Act of 1934, the registrant has duly
caused this registration statement to be signed on its behalf
by the undersigned, thereto duly authorized.
TELEDYNE, INC.
By: /s/ Judith R. Nelson
-----------------------------------------
Judith R. Nelson
Secretary
Date: January 5, 1995
<PAGE>
EXHIBIT INDEX
Exhibit Description Page
1 Rights Agreement, dated as of
January 4, 1995, between Teledyne,
Inc. and Chemical Trust Company of
California as Rights Agent, which
includes: as Exhibit A thereto, the
Form of Certificate of Amendment of
Certificate of Designation,
Preferences and Rights of Series D
Preferred Stock of Teledyne, Inc.; as
Exhibit B thereto, the Form of Right
Certificate; and, as Exhibit C
thereto, the Summary of Rights to
Purchase Series D Preferred Stock.
<PAGE>
EXHIBIT 1
<PAGE>
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TELEDYNE, INC.
and
CHEMICAL TRUST COMPANY OF CALIFORNIA, AS RIGHTS AGENT
RIGHTS AGREEMENT
DATED AS OF JANUARY 4, 1995
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<PAGE>
TABLE OF CONTENTS
Section 1. Certain Definitions
Section 2. Appointment of Rights Agent
Section 3. Issuance of Right Certificates
Section 4. Form of Right Certificate
Section 5. Countersignature and Registration
Section 6. Transfer, Split-Up, Combination and
Exchange of Right Certificates; Mutilated
Destroyed, Lost or Stolen Right
Certificates
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights
Section 8. Cancellation and Destruction of Right
Certificates
Section 9. Reservation and Availability of
Preferred Shares
Section 10. Preferred Shares Record Date
Section 11. Adjustment of Purchase Price, Number
and Kind of Shares or Number of Rights
Section 12. Certificate of Adjusted Purchase
Price or Number of Shares
Section 13. Consolidation, Merger or Sale or
Transfer of Assets or Earning Power
Section 14. Fractional Rights and Fractional
Shares
Section 15. Rights of Action
Section 16. Agreement of Right Holders
Section 17. Right Certificate Holder Not Deemed a
Stockholder
Section 18. Concerning the Rights Agent
Section 19. Merger or Consolidation or Change of
Name of Rights Agent
<PAGE>
Section 20. Duties of Rights Agent
Section 21. Change of Rights Agent
Section 22. Issuance of New Right Certificates
Section 23. Redemption and Termination
Section 24. Notice of Certain Events
Section 25. Miscellaneous
Section 26. Exchange
<PAGE>
RIGHTS AGREEMENT
This RIGHTS AGREEMENT (this "Agreement") is made as of
this fourth day of January, 1995 by and between Teledyne,
Inc., a Delaware corporation (the "Corporation"), and Chemical
Trust Company of California (the "Rights Agent"), with respect
to the following facts and circumstances.
A. The Board of Directors of the Corporation has
authorized and declared a dividend of one preferred share
purchase right (a "Right") for each Common Share (as
hereinafter defined) of the Corporation outstanding at the
Close of Business (as hereinafter defined) on January 27, 1995
(the "Record Date"), each Right representing the right to
purchase one one-thousandth (1/1000th) of a Preferred Share
(as hereinafter defined), upon the terms and subject to the
conditions herein set forth.
B. The Board of Directors of the Corporation has
further authorized and directed the issuance of one Right with
respect to each Common Share that shall become outstanding
between the Record Date and the earliest of the Distribution
Date, the Redemption Date or the Final Expiration Date (as
such terms are hereinafter defined); provided, however, that
Rights may be issued with respect to Common Shares that shall
become outstanding after the Distribution Date and prior to
the earlier of the Redemption Date and the Final Expiration
Date in accordance with the provisions of Section 22 of this
Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
mutual agreements herein set forth, the parties hereby agree
as follows:
Section 1. Certain Definitions.
For purposes of this Agreement, the following terms have
the meanings indicated:
1.1 "Acquiring Person" means any Person who or which,
together with all Affiliates and Associates of such Person,
without the prior approval of the Corporation's Board of
Directors, shall be the Beneficial Owner of 15% or more of the
then outstanding Common Shares (other than as a result of a
Permitted Offer) or was such a Beneficial Owner at any time
after the date hereof, whether or not such person continues to
be the Beneficial Owner of 15% or more of the then outstanding
Common Shares. Notwithstanding the foregoing: (A) the term
"Acquiring Person" shall not include (i) the Corporation,
(ii) any Subsidiary of the Corporation, (iii) any employee
benefit plan of the Corporation or of any Subsidiary of the
Corporation, (iv) any Person or entity organized, appointed or
established by the Corporation or any Subsidiary of the
<PAGE>
Corporation for or pursuant to the terms of any such plan, or
(v) any Person who or which, together with all Affiliates and
Associates of such Person, becomes the Beneficial Owner of 15%
or more of the then outstanding Common Shares as a result of
the acquisition of Common Shares directly from the
Corporation; and (B) no Person shall be deemed to be an
"Acquiring Person" either (i) as a result of the acquisition
of Common Shares by the Corporation which, by reducing the
number of Common Shares outstanding, increases the
proportional number of shares beneficially owned by such
Person together with all Affiliates and Associates of such
Person; provided, however, that if (X) a Person would become
an Acquiring Person (but for the operation of this subclause
(B)(i)) as a result of the acquisition of Common Shares by the
Corporation, and (Y) after such share acquisition by the
Corporation, such Person, or an Affiliate or Associate of such
Person, becomes the Beneficial Owner of any additional Common
Shares, then such Person shall be deemed an Acquiring Person,
or (ii) if (X) within eight (8) days after such Person would
otherwise have become an Acquiring Person (but for the
operation of this subclause (B)(ii)), such Person notifies the
Board of Directors of the Corporation that such Person did so
inadvertently and (Y) within two (2) days after such
notification, such Person is the Beneficial Owner of less than
15% of the outstanding Common Shares.
1.2 "Act" means the Securities Act of 1933, as amended
and as in effect on the date of this Agreement.
1.3 "Adjusted Number of Shares" and "Adjusted Purchase
Price" have the respective meanings set forth in
Section 11.1.3 hereof.
1.4 "Adjustment Shares" has the meaning set forth in
Section 11.1.2 hereof.
1.5 "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.
1.6 The term "current per share market price" shall
have the meaning set forth in Section 11.4.1 hereof when used
with respect to a "Security" (as defined in said
Section 11.4.1) and shall have the meaning set forth in
Section 11.4.2 when used with respect to the Preferred Shares.
1.7 A Person is the "Beneficial Owner" of and
"beneficially owns" any securities which:
1.7.1 such Person or any of such Person's
Affiliates or Associates beneficially owns, directly or
indirectly;
<PAGE>
1.7.2 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, or upon the exercise of conversion rights,
exchange rights, rights (other than the Rights), warrants or
options, or otherwise; provided, however, that a Person shall
not be deemed the Beneficial Owner of, or to beneficially own,
securities tendered pursuant to a tender or exchange offer
made by or on behalf of such Person or any of such Person's
Affiliates or Associates until such tendered securities are
accepted for purchase or exchange; or (B) the right to vote
pursuant to any agreement, arrangement or understanding;
provided, however, that a Person shall not be deemed the
Beneficial Owner of, or to beneficially own, any security if
the agreement, arrangement or understanding to vote such
security (1) arises solely from a revocable proxy or consent
given to such Person in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the
applicable rules and regulations promulgated under the
Exchange Act and (2) is not also then reportable on Schedule
13D under the Exchange Act (or any comparable or successor
report); or
1.7.3 are beneficially owned, directly or
indirectly, by any other Person (or any Affiliate or Associate
thereof) with which such Person (or any of such Person's
Affiliates or Associates) has any agreement, arrangement or
understanding relating to the acquisition, holding, voting
(except to the extent contemplated by the proviso to subclause
(B) of Section 1.7.2), or disposing of any securities of the
Corporation.
Notwithstanding anything in this Section 1.7 to the
contrary, the phrase "then outstanding," when used with
reference to a Person's Beneficial Ownership of securities of
the Corporation, 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.
Notwithstanding anything in this Section 1.7 to the
contrary, no Person shall be deemed to beneficially own any
securities solely by reason of such Person being a party to a
customary agreement pursuant to which such Person acts or
agrees to act as an underwriter with respect to a bona fide
public offering of securities.
No decision reached, or action taken, by the Board
of Directors of the Corporation or any committee thereof shall
cause any Person (or any Affiliate or Associate of such
Person) who is a member of the Board of Directors of the
Corporation or such committee to be deemed, for the purposes
of this Agreement, to be a Beneficial Owner of any securities
<PAGE>
beneficially owned by any other Person (or any Affiliate or
Associate of such Person) who is a member of the Board of
Directors of the Corporation or any committee thereof solely
by reason of such membership of the Board of Directors or any
committee thereof or participation in the decisions or actions
thereof on the part of either or both of such Persons.
1.8 "Business Day" means any day other than a Saturday,
Sunday or United States federal holiday.
1.9 "Capital Stock Equivalents" has the meaning set
forth in Section 11.1.3 hereof.
1.10 "Close of Business" on any given date means 5:00
P.M., New York time, on such date; provided, however, that if
such date is not a Business Day it means 5:00 P.M., New York
time, on the next succeeding Business Day.
1.11 "Common Shares" when used with reference to the
Corporation means the shares of Common Stock, par value $1.00
per share, of the Corporation or, in the event of a
subdivision, combination or consolidation with respect to such
shares of Common Stock, the shares of Common Stock resulting
from such subdivision, combination or consolidation. "Common
Shares" when used with reference to any Person other than the
Corporation means 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.
1.12 "Corporation" means Teledyne, Inc., a Delaware
corporation, and also means a Principal Party to the extent
provided in Section 13.1 hereof.
1.13 "Distribution Date" has the meaning set forth in
Section 3.1 hereof.
1.14 "Equivalent Preferred Shares" has the meaning set
forth in Section 11.2 hereof.
1.15 "Exchange Act" means the Securities Exchange Act of
1934, as amended and in effect on the date of this Agreement.
1.16 "Exchange Ratio" has the meaning set forth in
Section 26.1 hereof.
1.17 "Final Expiration Date" has the meaning set forth
in Section 7.1 hereof.
1.18 "Interested Stockholder" means any Acquiring Person
or any Affiliate or Associate of an Acquiring Person or any
other Person in which any such Acquiring Person, Affiliate or
Associate has an interest, or any other Person acting directly
<PAGE>
or indirectly on behalf of or in concert with any such
Acquiring Person, Affiliate or Associate.
1.19 "NASDAQ" has the meaning set forth in
Section 11.4.1 hereof.
1.20 "Permitted Offer" means a tender or exchange offer
which is for all outstanding Common Shares of the Corporation
at a price and on terms determined, prior to the purchase of
shares under such tender or exchange offer, by at least a
majority of the members of the Board of Directors who are not
officers of the Corporation and who are not Acquiring Persons
or Affiliates, Associates, nominees or representatives of an
Acquiring Person, to be adequate (taking into account all
factors that such directors deem pertinent including, without
limitation, prices that could reasonably be achieved if the
Corporation or its assets were sold on an orderly basis
designed to realize maximum value) and otherwise in the best
interests of the Corporation, its stockholders (other than the
Person or any Affiliate or Associate thereof on whose basis
the offer is being made) and other relevant constituencies,
taking into account all factors that such directors may deem
pertinent.
1.21 "Person" means any individual, firm, partnership,
corporation, trust, association, joint venture or other
entity, and includes any successor (by merger or otherwise) of
such entity.
1.22 "Preferred Shares" means shares of the
Corporation's Series D Preferred Stock, par value $1.00 per
share, having the relative rights, preferences and limitations
set forth in the Form of the Certificate of Designation,
Preferences and Rights of Series D Preferred Stock attached to
this Agreement as Exhibit A.
1.23 "Principal Party" has the meaning set forth in
Section 13.2 hereof.
1.24 "Proration Factor" has the meaning set forth in
Section 11.1.3 hereof.
1.25 "Purchase Price" has the meaning set forth in
Section 4.1 hereof.
1.26 "Record Date" has the meaning set forth in
Recital A hereof.
1.27 "Redemption Date" has the meaning set forth in
Section 7.1 hereof.
1.28 "Redemption Price" has the meaning set forth in
Section 21.1.1 hereof.
<PAGE>
1.29 "Right Certificate" has the meaning set forth in
Section 3.1 hereof.
1.30 "Rights" has the meaning set forth in Recital A
hereof.
1.31 "Rights Agent" means Chemical Trust Company of
California, as Rights Agent hereunder, and, from the time of
its succession, any successor Rights Agent under Section 19 or
Section 21 hereof.
1.32 "Section 11.1.2 Event" has the meaning set forth in
Section 11.1.2 hereof.
1.33 "Section 13 Event" means any event described in
clause (x), (y) or (z) of Section 13.1 hereof.
1.34 "Shares Acquisition Date" means the first date of
public announcement (which, for purposes of this definition,
shall include, without limitation, a report filed pursuant to
the Exchange Act) by the Corporation or an Acquiring Person
that an Acquiring Person has become such or that facts exist
as a result of which there exists an Acquiring Person;
provided, that, if such Person is determined not to have
become an Acquiring Person pursuant to subclause (B)(ii) of
Section 1.1 hereof, then no Shares Acquisition Date shall be
deemed to have occurred.
1.35 "Subsidiary" of any Person means any corporation or
other Person of which a majority of the voting power of the
voting equity securities or equity interest is owned, directly
or indirectly, by such Person.
1.36 "Summary of Rights" has the meaning set forth in
Section 3.2 hereof.
1.37 "Trading Day" has the meaning set forth in
Section 11.4.1 hereof.
1.38 "Triggering Event" means any Section 11.1.2 Event
or any Section 13 Event.
1.39 The term "voting securities" has the meaning set
forth in Section 13.1 hereof.
Section 2. Appointment of Rights Agent.
2.1 The Corporation hereby appoints the Rights Agent to
act as agent for the Corporation and the holders of the Rights
(who, in accordance with Section 3 hereof, shall prior to the
Distribution Date also be the holders of Common Shares) in
accordance with the terms and conditions hereof, and the
Rights Agent hereby accepts such appointment. The Corporation
<PAGE>
may from time to time appoint such co-Rights Agents as it may
deem necessary or desirable.
Section 3. Issuance of Right Certificates.
3.1 Until the earlier of (i) the Shares Acquisition
Date or (ii) the Close of Business on the tenth (10th) day (or
such later date as may be determined by action of the
Corporation's Board of Directors) after the date of the
commencement by any Person (other than the Corporation, any
Subsidiary of the Corporation, any employee benefit plan of
the Corporation or of any Subsidiary of the Corporation or any
Person or entity organized, appointed or established by the
Corporation or any Subsidiary of the Corporation for or
pursuant to the terms of any such plan) of, or after the date
of the first public announcement of the intention of any
Person (other than the Corporation, any Subsidiary of the
Corporation, any employee benefit plan of the Corporation or
of any Subsidiary of the Corporation or any Person or entity
organized, appointed or established by the Corporation or any
Subsidiary of the Corporation for or pursuant to the terms of
any such plan) to commence (which intention to commence
remains in effect for five (5) Business Days after such
announcement), a tender or exchange offer the consummation of
which would result in any Person becoming an Acquiring Person
(including, in the case of both (i) and (ii), any such date
which is after the date of this Agreement and prior to the
issuance of the Rights) (the "Distribution Date"), (x) the
Rights will be evidenced (subject to the provisions of Section
3.2 hereof) by the certificates for Common Shares registered
in the names of the holders thereof (which certificates shall
also be deemed to be Right Certificates) and not by separate
Right Certificates, and (y) the right to receive Right
Certificates will be transferable only in connection with the
transfer of the underlying Common Shares (including a transfer
to the Corporation); provided, however, that if a tender or
exchange offer is terminated prior to the occurrence of a
Distribution Date, then no Distribution Date shall occur as a
result of such tender or exchange offer. As soon as
practicable after the Distribution Date, the Corporation will
prepare and execute, the Rights Agent will countersign, and
the Corporation will send or cause to be sent by first-class,
postage-prepaid mail, to each record holder of Common Shares
as of the Close of Business on the Distribution Date, at the
address of such holder shown on the records of the
Corporation, a Right Certificate, substantially in the form of
Exhibit B hereto (a "Right Certificate"), evidencing one Right
for each Common Share so held. As of and after the
Distribution Date, the Rights will be evidenced solely by such
Right Certificates.
3.2 As promptly as practicable following the Record
Date, the Corporation will send a copy of a Summary of Rights
to Purchase Preferred Shares, in substantially the form of
<PAGE>
Exhibit C hereto (the "Summary of Rights"), by first-class,
postage-prepaid mail, to each record holder of Common Shares
as of the Close of Business on the Record Date, at the address
of such holder shown on the records of the Corporation. With
respect to certificates for Common Shares outstanding as of
the Record Date, until the Distribution Date the Rights will
be evidenced by such certificates registered in the names of
the holders thereof together with a copy of the Summary of
Rights attached thereto. Until the Distribution Date (or the
earlier of the Redemption Date or the Final Expiration Date),
the surrender for transfer of any certificate for Common
Shares outstanding on the Record Date, with or without a copy
of the Summary of Rights attached thereto, shall also
constitute the transfer of the Rights associated with such
Common Shares.
3.3 Certificates for Common Shares that become
outstanding (including, without limitation, reacquired Common
Shares referred to in the last sentence of this Section 3.3)
after the Record Date but prior to the earliest of the
Distribution Date, the Redemption Date or the Final Expiration
Date, shall be deemed also to be certificates for Rights, and
shall bear the following legend:
This certificate also evidences and
entitles the holder hereof to certain
rights as set forth in a Rights
Agreement between Teledyne, Inc. and
Chemical Trust Company of California, as
Rights Agent, dated as of January 4,
1995 (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 Teledyne, Inc. Under certain
circumstances, as set forth in the
Rights Agreement, such Rights will be
evidenced by separate certificates and
will no longer be evidenced by this
certificate. Teledyne, Inc. will mail
to the holder of this certificate a copy
of the Rights Agreement without charge
after receipt of a written request
therefor. Under certain circumstances
set forth in the Rights Agreement,
Rights issued to, or held by, any Person
who is, was or becomes an Acquiring
Person or an Affiliate or Associate
thereof (as defined in the Rights
Agreement) and certain related persons,
whether currently held by or on behalf
of such Person or by any subsequent
holder, may become null and void.
<PAGE>
With respect to such certificates containing the foregoing
legend, until the Distribution Date the Rights associated with
the Common Shares represented by such certificates shall be
evidenced by such certificates alone, and the surrender for
transfer of any such certificate shall also constitute the
transfer of the Rights associated with the Common Shares
represented thereby. In the event that the Corporation
purchases or acquires any Common Shares after the Record Date
but prior to the Distribution Date (or the earlier of the
Redemption Date or the Final Expiration Date), any Rights
associated with such Common Shares shall be deemed cancelled
and retired so that the Corporation shall not be entitled to
exercise any Rights associated with the Common Shares that are
no longer outstanding.
Section 4. Form of Right Certificate.
4.1 The Right Certificates (and the forms of election
to purchase and of assignment to be printed on the reverse
thereof) shall be substantially in the form set forth in
Exhibit B hereto and may have such marks of identification or
designation and such legends, summaries or endorsements
printed thereon as the Corporation may deem appropriate and as
are not inconsistent with the provisions of this Agreement, or
as may be required to comply with any applicable law or with
any rule or regulation made pursuant thereto or with any rule
or regulation of any stock exchange on which the Rights may
from time to time be listed, or to conform to usage. Subject
to the provisions of Section 11 and Section 22 hereof, the
Right Certificates shall entitle the holders thereof to
purchase such number of one one-thousandths (1/1000ths) of a
Preferred Share as shall be set forth therein at the price per
one one-thousandth (1/1000th) of a Preferred Share set forth
therein (the "Purchase Price"), but the amount and type of
securities purchasable upon the exercise of each Right and the
Purchase Price thereof shall be subject to adjustment as
provided herein.
4.2 Any Right Certificate issued pursuant to Section
3.1 or Section 22 hereof that represents Rights that are null
and void pursuant to Section 7.6 of this Agreement and any
Right Certificate issued pursuant to Section 6 or Section 11
hereof upon transfer, exchange, replacement or adjustment of
any other Right Certificate referred to in this sentence,
shall contain (to the extent feasible) the following legend:
The Rights represented by this Right
Certificate are or were beneficially
owned by a Person who was or became an
Acquiring Person or an Affiliate or
Associate of an Acquiring Person (as
such terms are defined in the Rights
Agreement). Accordingly, this Right
<PAGE>
Certificate and the Rights represented
hereby are null and void.
The provisions of Section 7.6 of this Agreement shall be
operative whether or not the foregoing legend is contained on
any such Right Certificate.
Section 5. Countersignature and Registration.
5.1 The Right Certificates shall be executed on behalf
of the Corporation by its Chairman of the Board, its Chief
Executive Officer, its President, any of its Vice Presidents,
or its Treasurer, either manually or by facsimile signature,
shall have affixed thereto the Corporation's seal or a
facsimile thereof, and shall be attested by the Secretary or
an Assistant Secretary of the Corporation, either manually or
by facsimile signature. The Right Certificates shall be
countersigned by the Rights Agent and shall not be valid for
any purpose unless so countersigned. In case any officer of
the Corporation who shall have signed any of the Right
Certificates shall cease to be such officer of the Corporation
before countersignature by the Rights Agent and issuance and
delivery by the Corporation, such Right Certificates may
nevertheless be countersigned by the Rights Agent and issued
and delivered by the Corporation with the same force and
effect as though the person who signed such Right Certificates
had not ceased to be such officer of the Corporation; and any
Right Certificate may be signed on behalf of the Corporation
by any person who, at the actual date of the execution of such
Right Certificate, shall be a proper officer of the
Corporation to sign such Right Certificate, although at the
date of the execution of this Rights Agreement any such person
was not such an officer.
5.2 Following the Distribution Date, the Rights Agent
will keep or cause to be kept, at its principal office or
offices designated as the appropriate place for surrender or
transfer of the Right Certificates, books for registration and
transfer of the Right Certificates issued hereunder. Such
books shall show the names and addresses of the respective
holders of the Right Certificates, the number of Rights
evidenced on the face of each of the Right Certificates and
the certificate number and the date of each of the Right
Certificates.
Section 6. Transfer, Split-Up, Combination and
Exchange of Right Certificates; Mutilated, Destroyed,
Lost or Stolen Right Certificates.
6.1 Subject to the provisions of Section 4.2, Section
7.6 and Section 14 hereof, at any time after the Close of
Business on the Distribution Date, and at or prior to the
Close of Business on the earlier of the Redemption Date or the
Final Expiration Date, any Right Certificate or Right
<PAGE>
Certificates may be transferred, split up, combined or
exchanged for another Right Certificate or Right Certificates,
entitling the registered holder to purchase a like number of
one one-thousandth (1/1000th) of a Preferred Share (or,
following a Triggering Event, other securities, as the case
may be) as the Right Certificate or Right Certificates
surrendered then entitled such holder (or former holder in the
case of a transfer) to purchase. Any registered holder
desiring to transfer, split up, combine or exchange any Right
Certificate or Right Certificates shall make such request in
writing delivered to the Rights Agent, and shall surrender the
Right Certificate or Right Certificates to be transferred,
split up, combined or exchanged at the principal office or
offices of the Rights Agent designated for such purpose.
Neither the Rights Agent nor the Corporation shall be
obligated to take any action whatsoever with respect to the
transfer of any such surrendered Right Certificate until the
registered holder shall have completed and signed the
certificate contained in the form of assignment on the reverse
side of such Right Certificate and shall have provided such
additional evidence of the identity of the Beneficial Owner
(or former Beneficial Owner) or Affiliates or Associates
thereof as the Corporation shall reasonably request.
Thereupon the Rights Agent shall, subject to Section 4.2,
Section 7.6 and Section 14 hereof, countersign and deliver to
the Person entitled thereto a Right Certificate or Right
Certificates, as the case may be, as so requested. The
Corporation may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in
connection with any transfer, split up, combination or
exchange of Right Certificates.
6.2 Upon receipt by the Corporation and the Rights
Agent of evidence reasonably satisfactory to them of the loss,
theft, destruction or mutilation of a Right Certificate, and,
in case of loss, theft or destruction, of indemnity or
security reasonably satisfactory to them, and, at the
Corporation's request, reimbursement to the Corporation and
the Rights Agent of all reasonable expenses incidental
thereto, and upon surrender to the Rights Agent and
cancellation of the Right Certificate if mutilated, the
Corporation will make and deliver a new Right Certificate of
like tenor to the Rights Agent for countersignature and
delivery to the registered holder in lieu of the Right
Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights.
7.1 Subject to Section 7.6 hereof, the registered
holder of any Right Certificate may exercise the Rights
evidenced thereby (except as otherwise provided herein) in
whole or in part at any time after the Distribution Date upon
surrender of the Right Certificate, with the form of election
<PAGE>
to purchase and the certificate on the reverse side thereof
duly executed, to the Rights Agent at the principal office or
offices of the Rights Agent designated for such purpose,
together with payment of the aggregate Purchase Price for the
total number of one one-thousandth (1/1000th) of a Preferred
Share (or other securities, as the case may be) as to which
such surrendered Rights are exercised, at or prior to the
earlier of (i) the Close of Business on January 4, 2005 (the
"Final Expiration Date"), or (ii) the time at which the Rights
are redeemed as provided in Section 23 hereof (the "Redemption
Date").
7.2 The Purchase Price for each one one-thousandth
(1/1000th) of a Preferred Share pursuant to the exercise of a
Right shall initially be $75.00 shall be subject to adjustment
from time to time as provided in the next sentence and in
Sections 11 and 13.1 hereof and shall be payable in accordance
with paragraph 7.3 below. Anything in this Agreement to the
contrary notwithstanding, in the event that at any time after
the date of this Agreement and prior to the Distribution Date,
the Corporation shall (i) declare or pay any dividend on the
Common Shares payable in Common Shares or (ii) effect a
subdivision, combination or consolidation of the Common Shares
(by reclassification or otherwise than by payment of dividends
in Common Shares) into a greater or lesser number of Common
Shares, then, in any such case, each Common Share outstanding
following such subdivision, combination or consolidation shall
continue to have a Right associated therewith and the Purchase
Price following any such event shall be proportionately
adjusted to equal the result obtained by multiplying the
Purchase Price immediately prior to such event by a fraction
the numerator of which shall be the total number of Common
Shares outstanding immediately prior to the occurrence of the
event and the denominator of which shall be the total number
of Common Shares outstanding immediately following the
occurrence of such event. The adjustment provided for in the
preceding sentence shall be made successively whenever such a
dividend is declared or paid or such a subdivision,
combination or consolidation is effected.
7.3 Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase and
the certificate on the reverse side thereof duly executed,
accompanied by payment of the Purchase Price for the Preferred
Shares (or other securities, as the case may be) 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 6 hereof by certified check, cashier's
check or money order payable to the order of the Corporation,
the Rights Agent shall thereupon promptly (i) (A) requisition
from any transfer agent of the Preferred Shares certificates
for the number of Preferred Shares to be purchased, and the
Corporation hereby irrevocably authorizes its transfer agent
to comply with all such requests, or (B) if the Corporation,
<PAGE>
in its sole discretion, shall have elected to deposit the
Preferred Shares issuable upon exercise of the Rights
hereunder into a depositary, requisition from the depositary
agent depositary receipts representing such number of one one-
thousandths (1/1000ths) of a Preferred Share as are to be
purchased (in which case certificates for the Preferred Shares
represented by such receipts shall be deposited by the
transfer agent with the depositary agent) and the Corporation
will direct the depositary agent to comply with such requests,
(ii) when appropriate, requisition from the Corporation the
amount of cash to be paid in lieu of issuance of fractional
shares in accordance with Section 14 hereof, (iii) after
receipt of such certificates or depositary receipts, cause the
same to be delivered to or upon the order of the registered
holder of such Right Certificate, registered in such name or
names as may be designated by such holder, and (iv) when
appropriate, after receipt thereof, deliver such cash to or
upon the order of the registered holder of such Right
Certificate. In the event that the Corporation is obligated
to issue other securities (including Common Shares) of the
Corporation pursuant to Section 11.1 hereof, the Corporation
will make all arrangements necessary so that such other
securities are available for distribution by the Rights Agent,
if and when appropriate.
7.4 In addition, in the case of an exercise of the
Rights by a holder pursuant to Section 11.1.2, the Rights
Agent shall return such Right Certificate to the registered
holder thereof after imprinting, stamping or otherwise
indicating thereon that the rights represented by such Right
Certificate no longer include the rights provided by Section
11.1.2 of the Rights Agreement and if less than all the Rights
represented by such Right Certificate were so exercised, the
Rights Agent shall indicate on the Right Certificate the
number of Rights represented thereby that continue to include
the rights provided by Section 11.1.2.
7.5 In case the registered holder of any Right
Certificate shall exercise less than all the Rights evidenced
thereby, a new Right Certificate evidencing Rights equivalent
to the Rights remaining unexercised shall be issued by the
Rights Agent to the registered holder of such Right
Certificate or to his duly authorized assigns, subject to the
provisions of Section 14 hereof, or the Rights Agent shall
place an appropriate notation on the Right Certificate with
respect to those Rights exercised.
7.6 Notwithstanding anything in this Agreement to the
contrary, from and after the first occurrence of a Section
11.1.2 Event, any Rights beneficially owned by (i) an
Acquiring Person or an Affiliate or Associate of an Acquiring
Person, (ii) a transferee of an Acquiring Person (or of any
Affiliate or Associate thereof) who becomes a transferee after
the Acquiring Person becomes such, or (iii) a transferee of an
<PAGE>
Acquiring Person (or of any Affiliate or Associate thereof)
who becomes a transferee prior to or concurrently with the
Acquiring Person becoming such and receives such Rights
pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person (or from any
Affiliate or Associate thereof) to holders of equity interests
in such Acquiring Person or to any Person with whom the
Acquiring Person has a continuing agreement, arrangement or
understanding regarding the transferred Rights or (B) a
transfer that the Board of Directors of the Corporation has
determined is part of a plan, arrangement or understanding
that has as a primary purpose or effect the avoidance of this
Section 7.6, shall become null and void without any further
action and no holder of such Rights shall have any rights
whatsoever with respect to such Rights, whether under any
provision of this Agreement or otherwise. The Corporation
shall use all reasonable efforts to insure that the provisions
of this Section 7.6 and Section 4.2 hereof are complied with,
but shall have no liability to any holder of Right
Certificates or other Person as a result of its failure to
make any determinations with respect to an Acquiring Person or
its Affiliates, Associates or transferees hereunder.
7.7 Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Corporation shall
be obligated to undertake any action with respect to a
registered holder upon the occurrence of any purported
exercise as set forth in this Section 7 unless such registered
holder shall have (i) completed and signed the certificate
contained in the form of election to purchase set forth on the
reverse side of the Right Certificate surrendered for such
exercise, and (ii) provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner)
or Affiliates or Associates thereof as the Corporation shall
reasonably request.
Section 8. Cancellation and Destruction of
Right Certificates.
8.1 All Right Certificates surrendered for the purpose
of exercise, transfer, split up, combination or exchange
shall, if surrendered to the Corporation or to any of its
agents, be delivered to the Rights Agent for cancellation or
in cancelled form, or, if surrendered to the Rights Agent,
shall be cancelled by it, and no Right Certificates shall be
issued in lieu thereof except as expressly permitted by the
provisions of this Rights Agreement. The Corporation shall
deliver to the Rights Agent for cancellation and retirement,
and the Rights Agent shall so cancel and retire, any other
Right Certificate purchased or acquired by the Corporation
otherwise than upon the exercise thereof. The Rights Agent
shall deliver all cancelled Right Certificates to the
Corporation, or shall, at the written request of the
Corporation, destroy such cancelled Right Certificates, and in
<PAGE>
such case shall deliver a certificate of destruction thereof
to the Corporation.
Section 9. Reservation and Availability of
Preferred Shares.
9.1 The Corporation covenants and agrees that, at all
times prior to the occurrence of a Section 11.1.2 Event, it
will cause to be reserved and kept available out of its
authorized and unissued Preferred Shares, or any authorized
and issued 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 and, after the
occurrence of a Section 11.1.2 Event, shall, to the extent
reasonably practicable, so reserve and keep available a
sufficient number of Common Shares (and/or other securities)
that may be required to permit the exercise in full of the
Rights pursuant to this Agreement.
9.2 So long as the Preferred Shares (and, after the
occurrence of a Section 11.1.2 Event, Common Shares or any
other securities) issuable upon the exercise of the Rights may
be listed on any national securities exchange, the Corporation
shall use its best efforts to cause, from and after such time
as the Rights become exercisable, all shares or other
securities reserved for such issuance to be listed on such
exchange upon official notice of issuance upon such exercise.
9.3 The Corporation covenants and agrees that it will
take all such action as may be necessary to ensure that all
Preferred Shares (or Common Shares and/or other securities, as
the case may be) delivered upon exercise of Rights shall, at
the time of delivery of the certificates for such shares or
other securities (subject to payment of the Purchase Price),
be duly and validly authorized and issued and fully paid and
non-assessable shares or securities.
9.4 The Corporation covenants and agrees that it will
pay when due and payable any and all United States federal and
state transfer taxes and charges that may be payable in
respect of the issuance or delivery of the Right Certificates
or of any Preferred Shares (or Common Shares and/or other
securities, as the case may be) upon the exercise of Rights.
The Corporation shall not, however, be required to pay any
transfer tax that may be payable in respect of any transfer or
delivery of Right Certificates to a person other than, or the
issuance or delivery of certificates or depositary receipts
for the Preferred Shares (or Common Shares and/or other
securities, as the case may be) in a name other than that of,
the registered holder of the Right Certificate evidencing
Rights surrendered for exercise, or to issue or to deliver any
certificates or depositary receipts for Preferred Shares (or
Common Shares and/or other securities, as the case may be)
upon the exercise of any Rights, until any such tax shall have
<PAGE>
been paid (any such tax being payable by the holder of such
Right Certificate at the time of surrender) or until it has
been established to the Corporation's reasonable satisfaction
that no such tax is due.
9.5 The Corporation shall use its best efforts to
(i) file, as soon as practicable following the Shares
Acquisition Date, a registration statement under the Act, with
respect to the securities purchasable upon exercise of the
Rights on an appropriate form, (ii) cause such registration
statement to become effective as soon as practicable after
such filing, and (iii) cause such registration statement to
remain effective (with a prospectus at all times meeting the
requirements of the Act and the rules and regulations
thereunder) until the date of the expiration of the period for
exercise of the Rights provided by Section 11.1.2. The
Corporation will also take such action as may be appropriate
under the blue sky laws of the various states.
Section 10. Preferred Shares Record Date.
10.1 Each person in whose name any certificate for
Preferred Shares (or Common Shares and/or other securities, as
the case may be) is issued upon the exercise of Rights shall
for all purposes be deemed to have become the holder of record
of the Preferred Shares (or Common Shares and/or other
securities, as the case may be) represented thereby on, and
such certificate shall be dated, the date upon which the Right
Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and any applicable transfer
taxes) was made; provided, however, that, if the date of such
surrender and payment is a date upon which the Preferred
Shares (or Common Shares and/or other securities, as the case
may be) transfer books of the Corporation are closed, such
person shall be deemed to have become the record holder of
such shares on, and such certificate shall be dated, the next
succeeding Business Day on which the Preferred Shares (or
Common Shares and/or other securities, as the case may be)
transfer books of the Corporation are open.
Section 11. Adjustment of Purchase Price, Number and
Kind of Shares or Number of Rights.
The Purchase Price, the number and kind of shares covered
by each Right and the number of Rights outstanding are subject
to adjustment from time to time as provided in this
Section 11.
11.1 Adjustment Events.
11.1.1 In the event the Corporation shall at any
time after the date of this Agreement (A) declare a dividend
on the Preferred Shares payable in Preferred Shares, (B)
subdivide the outstanding Preferred Shares, (C) combine the
<PAGE>
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 Corporation is the continuing or surviving
corporation), except as otherwise provided in this Section
11.1 and Section 7.6 hereof, the Purchase Price in effect at
the time of the record date for such dividend or of the
effective date of such subdivision, combination or
reclassification, and the number and kind of shares of capital
stock issuable on such date, shall be proportionately adjusted
so that the holder of any Right exercised after such time
shall be entitled to receive the aggregate number and kind of
shares of capital stock that, if such Right had been exercised
immediately prior to such date and at a time when the
Preferred Shares transfer books of the Corporation were open,
such holder would have owned upon such exercise and been
entitled to receive by virtue of such dividend, subdivision,
combination or reclassification; provided, however, that in no
event shall the consideration to be paid upon the exercise of
one Right be less than the aggregate par value of the shares
of capital stock of the Corporation issuable upon exercise of
one Right. If an event occurs that would require an
adjustment under both Section 11.1.1 and Section 11.1.2, the
adjustment provided for in this Section 11.1.1 shall be in
addition to, and shall be made prior to, any adjustment
required pursuant to Section 11.1.2.
11.1.2 In the event (a "Section 11.1.2 Event") that
any Person, alone or together with its Affiliates and
Associates, shall become an Acquiring Person, then proper
provision shall be made so that each holder of a Right (except
as provided below and in Section 7.6 hereof) shall, for a
period of sixty (60) days (or such longer period as the Board
of Directors of the Corporation may determine at any time
prior to or during such period of sixty (60) days) after the
later of the occurrence of any such event or the effective
date of an appropriate registration statement under the Act
pursuant to Section 9.5 hereof, have a right to receive, upon
exercise thereof at a price equal to the then current Purchase
Price, in accordance with the terms of this Agreement, such
number of Common Shares (or, in the discretion of the Board of
Directors, one one-thousandths (1/1000ths) of a Preferred
Share) as shall equal the result obtained by (x) multiplying
the then current Purchase Price by the then number of one one-
thousandth (1/1000th) of a Preferred Share for which a Right
was exercisable immediately prior to the first occurrence of a
Section 11.1.2 Event, and (y) dividing that product by 50% of
the then current per share market price of the Corporation's
Common Shares (determined pursuant to Section 11.4 hereof) on
the date of such first occurrence (such number of shares being
referred to as the "Adjustment Shares"); provided, however,
that if the transaction that would otherwise give rise to the
foregoing adjustment is also subject to the provisions of
<PAGE>
Section 13 hereof, then only the provisions of Section 13
hereof shall apply and no adjustment shall be made pursuant to
this Section 11.1.2.
11.1.3 In the event that there shall not be
sufficient treasury or authorized but unissued (and
unreserved) Common Shares to permit the exercise in full of
the Rights in accordance with Section 11.1.2 and the Rights
become so exercisable (and the Board of Directors of the
Corporation has not determined to make the Rights exercisable
solely into fractions of a Preferred Share), notwithstanding
any other provision of this Agreement, to the extent necessary
and permitted by applicable law, each Right shall thereafter
represent the right to receive, upon exercise thereof at the
then current Purchase Price in accordance with the terms of
this Agreement, (x) a number of (or fractions of) Common
Shares (up to the maximum number of Common Shares that may
permissibly be issued) and (y) one one-thousandth (1/1000th)
of a Preferred Share or a number of, or fractions of, other
equity securities of the Corporation (or, in the discretion of
the Board of Directors of the Corporation, debt) that the
Board of Directors of the Corporation has determined to have
the same aggregate current market value (determined pursuant
to Section 11.1.1 and Section 11.1.2 hereof, to the extent
applicable) as one Common Share (such number of, or fractions
of, Preferred Shares, debt or other equity securities or debt
of the Corporation being referred to as a "Capital Stock
Equivalent"), equal in the aggregate to the number of
Adjustment Shares; provided, however, if sufficient Common
Shares and/or Capital Stock Equivalents are unavailable, then
the Corporation shall, to the extent permitted by applicable
law, take all such action as may be necessary to authorize
additional Common Shares or Capital Stock Equivalents for
issuance upon exercise of the Rights, including the calling of
a meeting of stockholders; and provided, further, that if the
Corporation is unable to cause sufficient Common Shares and/or
Capital Stock Equivalents to be available for issuance upon
exercise in full of the Rights, then each Right shall
thereafter represent the right to receive the Adjusted Number
of Shares upon exercise at the Adjusted Purchase Price (as
such terms are hereinafter defined). As used herein, the term
"Adjusted Number of Shares" shall be equal to that number of
(or fractions of) Common Shares (and/or Capital Stock
Equivalents) equal to the product of (x) the number of
Adjustment Shares and (y) a fraction, the numerator of which
is the number of Common Shares (and/or Capital Stock
Equivalents) available for issuance upon exercise of the
Rights and the denominator of which is the aggregate number of
Adjustment Shares otherwise issuable upon exercise in full of
all Rights (assuming there were a sufficient number of Common
Shares available) (such fraction being referred to as the
"Proration Factor"). The "Adjusted Purchase Price" shall mean
the product of the Purchase Price and the Proration Factor.
The Board of Directors of the Corporation may, but shall not
<PAGE>
be required to, establish procedures to allocate the right to
receive Common Shares and Capital Stock Equivalents upon
exercise of the Rights among holders of Rights.
11.2 In case the Corporation shall fix a record date for
the issuance of rights (other than the Rights), options or
warrants to all holders of Preferred Shares entitling them
(for a period expiring within 45 calendar days after such
record date) to subscribe for or purchase Preferred Shares (or
shares having the same rights, privileges and preferences as
the Preferred Shares ("Equivalent Preferred Shares")) or
securities convertible into Preferred Shares or Equivalent
Preferred Shares at a price per Preferred Share or Equivalent
Preferred Share (or having a conversion price per share, if a
security convertible into Preferred Shares or Equivalent
Preferred Shares) less than the then current per share market
price of the Preferred Shares (as determined pursuant to
Section 11.4 hereof) on such record date, the Purchase Price
to be in effect after such record date shall be determined by
multiplying the Purchase Price in effect immediately prior to
such record date by a fraction, the numerator of which shall
be the number of Preferred Shares outstanding on such record
date plus the number of Preferred Shares that the aggregate
offering price of the total number of Preferred Shares and/or
Equivalent Preferred Shares so to be offered (and/or the
aggregate initial conversion price of the convertible
securities so to be offered) would purchase at such current
per share market price, and the denominator of which shall be
the number of Preferred Shares outstanding on such record date
plus the number of additional Preferred Shares and/or
Equivalent Preferred Shares to be offered for subscription or
purchase (or into which the convertible securities so to be
offered are initially convertible); provided, however, that in
no event shall the consideration to be paid upon the exercise
of one Right be less than the aggregate par value of the
shares of capital stock of the Corporation issuable upon
exercise of one Right. In case such subscription price may be
paid in a consideration part or all of which shall be in a
form other than cash, the value of such consideration shall be
determined in good faith by the Board of Directors of the
Corporation, whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on
the Rights Agent. Preferred Shares owned by or held for the
account of the Corporation shall not be deemed outstanding for
the purpose of any such computation. Such adjustment shall be
made successively whenever such a record date is fixed; and in
the event that such rights, options or warrants are not so
issued, the Purchase Price shall be adjusted to be the
Purchase Price that would then be in effect if such record
date had not been fixed.
11.3 In case the Corporation 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
<PAGE>
with a consolidation or merger in which the Corporation is the
continuing or surviving corporation) of evidences of
indebtedness or assets (other than a regular quarterly cash
dividend or a dividend payable in Preferred Shares) or
subscription rights or warrants (excluding those referred to
in Section 11.2 hereof), the Purchase Price to be in effect
after such record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the then
current per share market price (as determined pursuant to
Section 11.4 hereof) of the Preferred Shares on such record
date, less the fair market value (as determined in good faith
by the Board of Directors of the Corporation, whose
determination shall be described in a statement filed with the
Rights Agent and shall be binding on 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 Corporation to be issued upon exercise of one
Right. Such adjustments shall be made successively whenever
such a record date is fixed; and in the event that such
distribution is not so made, the Purchase Price shall again be
adjusted to be the Purchase Price that would then be in effect
if such record date had not been fixed.
11.4 Computation of "Current Per Share Market Price."
11.4.1 For the purpose of any computation
hereunder, the "current per share market price" of any
security (a "Security" for the purpose of this Section 11.4.1)
on any date shall be deemed to be the average of the daily
closing prices per share of such Security for the thirty (30)
consecutive Trading Days immediately prior to such date;
provided, however, that in the event that the current per
share market price of the Security is determined during a
period following the announcement by the issuer of such
Security of (A) a dividend or distribution on such Security
payable in shares of such Security or securities convertible
into such shares, or (B) any subdivision, combination or
reclassification of such Security and prior to the expiration
of thirty (30) Trading Days after the ex-dividend date for
such dividend or distribution, or the record date for such
subdivision, combination or reclassification, then, and in
each such case, the current per share market price shall be
appropriately adjusted to reflect the current market price per
share equivalent of such Security. The closing price for each
day shall be the last sale price, regular way, or, in case no
such sale takes place on such day, the average of the closing
bid and asked prices, regular way, in either case as reported
in the principal consolidated transaction reporting system
<PAGE>
with respect to securities listed or admitted to trading on
the New York Stock Exchange or, if the Security is not listed
or admitted to trading on the New York Stock Exchange, as
reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal
national securities exchange on which the Security is listed
or admitted to trading or, if the Security is not listed or
admitted to trading on any national securities exchange, the
last quoted price or, if not so quoted, the average of the
high bid and low asked prices in the over-the-counter market,
as reported by the National Association of Securities Dealers,
Inc. Automated Quotations System ("NASDAQ") or such other
system then in use, or, if on any such date the Security is
not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional
market maker making a market in the Security selected by the
Board of Directors of the Corporation. If on any such date no
such market maker is making a market in the Security, the fair
value of the Security on such date as determined in good faith
by the Board of Directors of the Corporation shall be used.
The term "Trading Day" shall mean a day on which the principal
national securities exchange on which the Security is listed
or admitted to trading is open for the transaction of business
or, if the Security is not listed or admitted to trading on
any national securities exchange, a Business Day.
11.4.2 For the purpose of any computation
hereunder, the "current per share market price" of the
Preferred Shares shall be determined in accordance with the
method set forth in Section 11.4.1. If the Preferred Shares
are not publicly traded, the "current per share market price"
of the Preferred Shares shall be conclusively deemed to be the
current per share market price of the Common Shares as
determined pursuant to Section 11.4.1 (appropriately adjusted
to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof), multiplied by
1,000. If neither the Common Shares nor the Preferred Shares
are publicly held or so listed or traded, "current per share
market price" shall mean, with respect to the Preferred
Shares, the fair value per share as determined in good faith
by the Board of Directors of the Corporation, whose
determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent.
11.5 Anything herein to the contrary notwithstanding, no
adjustment in the Purchase Price shall be required unless such
adjustment would require an increase or decrease of at least
1% in the Purchase Price; provided, however, that any
adjustments that by reason of this Section 11.5 are not
required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under
this Section 11 shall be made to the nearest cent or to the
nearest one one-thousandth (1/1000th) of a Preferred Share or
of any other share or security as the case may be.
<PAGE>
Notwithstanding the first sentence of this Section 11.5, any
adjustment required by this Section 11 shall be made no later
than the earlier of (i) three (3) years from the date of the
transaction that mandates such adjustment or (ii) the Final
Expiration Date.
11.6 If as a result of an adjustment made pursuant to
Section 11.1.2 or Section 13.1 hereof, the holder of any Right
thereafter exercised shall become entitled to receive any
shares of capital stock of the Corporation other than
Preferred Shares, thereafter the number of other shares so
receivable upon exercise of any Right shall be subject to
adjustment from time to time in a manner and on terms as
nearly equivalent as practicable to the provisions with
respect to the Preferred Shares contained in Section 11.1
through 11.3, inclusive, and the provisions of Sections 7, 9,
10, 13 and 14 with respect to the Preferred Shares shall apply
on like terms to any such other shares.
11.7 All Rights originally issued by the Corporation
subsequent to any adjustment made to the Purchase Price
hereunder shall evidence the right to purchase, at the
adjusted Purchase Price, the number of one one-thousandths
(1/1000ths) of a Preferred Share purchasable from time to time
hereunder upon exercise of the Rights, all subject to further
adjustment as provided herein.
11.8 The Corporation may elect on or after the date of
any adjustment of the Purchase Price to adjust the number of
Rights, in lieu of any adjustment in the number of one one-
thousandths (1/1000ths) of a Preferred Share purchasable upon
the exercise of a Right. Each of the Rights outstanding after
such adjustment of the number of Rights shall be exercisable
for the number of one one-thousandths (1/1000ths) of a
Preferred Share for which a Right was exercisable immediately
prior to such adjustment. Each Right held of record prior to
such adjustment of the number of Rights shall become that
number of Rights (calculated to the nearest one ten-
thousandth) obtained by dividing the Purchase Price in effect
immediately prior to adjustment of the Purchase Price by the
Purchase Price in effect immediately after adjustment of the
Purchase Price. The Corporation 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 ten (10) days later than
the date of the public announcement. If Right Certificates
have been issued, upon each adjustment of the number of Rights
pursuant to this Section 11.8, the Corporation shall, as
promptly as practicable, cause to be distributed to holders of
record of Right Certificates on such record date Right
Certificates evidencing, subject to Section 14 hereof, the
<PAGE>
additional Rights to which such holders shall be entitled as a
result of such adjustment, or, at the option of the
Corporation, 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
Corporation, new Right Certificates evidencing all the Rights
to which such holders shall be entitled after such adjustment.
Right Certificates so to be distributed shall be issued,
executed and countersigned in the manner provided for herein
and shall be registered in the names of the holders of record
of Right Certificates on the record date specified in the
public announcement.
11.9 Irrespective of any adjustment or change in the
Purchase Price or the number of one one-thousandths
(1/1000ths) 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-thousandths (1/1000ths) of a Preferred Share
that were expressed in the initial Right Certificates issued
hereunder.
11.10 Before taking any action that would cause an
adjustment reducing the Purchase Price below the then par
value, if any, of the number of one one-thousandths
(1/1000ths) of a Preferred Share, Common Share or other
securities issuable upon exercise of the Rights, the
Corporation shall take any corporate action that may, in the
opinion of its counsel, be necessary in order that the
Corporation may validly and legally issue such number of fully
paid and non-assessable one one-thousandths (1/1000ths) of a
Preferred Share, Common Share or other securities at such
adjusted Purchase Price.
11.11 In any case in which this Section 11 shall require
that an adjustment in the Purchase Price be made effective as
of a record date for a specified event, the Corporation may
elect to defer until the occurrence of such event the issuance
to the holder of any Right exercised after such record date
the Preferred Shares, Common Shares or other securities of the
Corporation, if any, issuable upon such exercise over and
above the Preferred Shares, Common Shares or other securities
of the Corporation, if any, issuable upon such exercise on the
basis of the Purchase Price in effect prior to such
adjustment; provided, however, that the Corporation shall
deliver to such holder a due bill or other appropriate
instrument evidencing such holder's right to receive such
additional shares upon the occurrence of the event requiring
such adjustment.
11.12 Anything in this Section 11 to the contrary
notwithstanding, the Corporation shall be entitled to make
such reductions in the Purchase Price, in addition to those
<PAGE>
adjustments expressly required by this Section 11, as and to
the extent that the Corporation in its sole discretion shall
determine to be advisable in order that any (i) consolidation
or subdivision of the Preferred Shares, (ii) issuance wholly
for cash of Preferred Shares at less than the current market
price, (iii) issuance wholly for cash of Preferred Shares or
securities that by their terms are convertible into or
exchangeable for Preferred Shares, (iv) stock dividends or
(v) issuance of rights, options or warrants referred to in
this Section 11, hereafter made by the Corporation to holders
of its Preferred Shares shall not be taxable to such holders.
11.13 The Corporation covenants and agrees that it shall
not, at any time after the Distribution Date, (i) consolidate
with any other Person (other than a Subsidiary of the
Corporation in a transaction that does not violate Section
11.14 hereof), (ii) merge with or into any other Person (other
than a Subsidiary of the Corporation in a transaction that
does not violate Section 11.14 hereof), or (iii) sell or
transfer (or permit any Subsidiary to sell or transfer), in
one transaction, or a series of related transactions, assets
or earning power aggregating more than 50% of the assets or
earning power of the Corporation and its Subsidiaries (taken
as a whole) to any other Person or Persons (other than the
Corporation and/or any of its Subsidiaries in one or more
transactions each of which does not violate Section 11.14
hereof), if (x) at the time of or immediately after such
consolidation, merger, sale or transfer, there are any charter
or bylaw provisions or any rights, warrants or other
instruments or securities outstanding or agreements in effect
or other actions taken that would materially diminish or
otherwise eliminate the benefits intended to be afforded by
the Rights or (y) prior to, simultaneously with or immediately
after such consolidation, merger, sale or transfer, the
stockholders of the Person who constitutes, or would
constitute, the "Principal Party" for purposes of Section 13.1
hereof shall have received a distribution of Rights previously
owned by such Person or any of its Affiliates and Associates.
The Corporation shall not consummate any such consolidation,
merger, sale or transfer unless prior thereto the Corporation
and such other Person shall have executed and delivered to the
Rights Agent a supplemental agreement evidencing compliance
with this Section 11.13.
11.14 The Corporation covenants and agrees that, after
the Distribution Date, it will not, except as permitted by
Section 23 or Section 25.2 hereof, take (or permit any
Subsidiary to take) any action the purpose of which is to, or
if at the time such action is taken it is reasonably
foreseeable that the effect of such action is to, materially
diminish or otherwise eliminate the benefits intended to be
afforded by the Rights.
<PAGE>
11.15 The exercise of Rights under Section 11.1.2 shall
only result in the loss of rights under Section 11.1.2 to the
extent so exercised and shall not otherwise affect the rights
represented by the Rights under this Agreement, including the
rights represented by Section 13.
Section 12. Certificate of Adjusted Purchase Price
or Number of Shares.
12.1 Whenever an adjustment is made as provided in
Section 11 or Section 13 hereof, the Corporation shall
promptly (a) prepare a certificate setting forth such
adjustment and a brief statement of the facts accounting for
such adjustment, (b) file with the Rights Agent and with each
transfer agent for the Common Shares and the Preferred Shares
a copy of such certificate and (c) mail a brief summary
thereof to each holder of a Right Certificate in accordance
with Section 25.1 hereof. The Rights Agent shall be fully
protected in relying on any such certificate and on any
adjustment therein contained and shall not be deemed to have
knowledge of such adjustment unless and until it shall have
received such certificate.
Section 13. Consolidation, Merger or Sale or
Transfer of Assets or Earning Power.
13.1 In the event that, on or following the Shares
Acquisition Date, directly or indirectly, (x) the Corporation
shall consolidate with, or merge with and into, any Interested
Stockholder or, if in such merger or consolidation all holders
of Common Shares are not treated alike, any other Person,
(y) the Corporation shall consolidate with, or merge with, any
Interested Stockholder or, if in such merger or consolidation
all holders of Common Shares are not treated alike, any other
Person, and the Corporation shall be the continuing or
surviving corporation of such consolidation or merger (other
than, in a case of any transaction described in (x) or (y), a
merger or consolation that would result in all of the
securities generally entitled to vote in the election of
directors of the Corporation ("voting securities") outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into securities of
the surviving entity) all of the voting securities of the
Corporation or such voting surviving entity outstanding
immediately after such merger or consolidation and the holders
of such securities not having changed as a result of such
merger or consolidation), or (z) the Corporation shall sell or
otherwise transfer (or one or more of its Subsidiaries shall
sell or otherwise transfer), in one transaction or a series of
related transactions, assets or earning power aggregating more
than 50% of the assets or earning power of the Corporation and
its Subsidiaries (taken as a whole) to any Interested
Stockholder or Stockholders or, if in such transaction all
holders of Common Shares are not treated alike, any other
<PAGE>
Person (other than the Corporation or any Subsidiary of the
Corporation in one or more transactions each of which does not
violate Section 11.14 hereof), then, and in each such case
(except as provided in Section 13.4 hereof), proper provision
shall be made so that (i) each holder of a Right, except as
provided in Section 7.6 hereof, shall thereafter have the
right to receive, upon the exercise thereof at a price equal
to the then current Purchase Price, in accordance with the
terms of this Agreement and in lieu of Preferred Shares, such
number of freely tradeable Common Shares of the Principal
Party, not subject to any liens, encumbrances, rights of first
refusal or other adverse claims, as shall equal the result
obtained by (A) multiplying the then current Purchase Price by
the number of one one-thousandths (1/1000ths) of a Preferred
Share for which a Right is then exercisable (without taking
into account any adjustment previously made pursuant to
Section 11.1.2) and dividing that product by (B) 50% of the
then current per share market price of the Common Shares of
such Principal Party (determined pursuant to Section 11.4
hereof) on the date of consummation of such Section 13 Event;
(ii) such Principal Party shall thereafter be liable for, and
shall assume, by virtue of such Section 13 Event, all the
obligations and duties of the Corporation pursuant to this
Agreement; (iii) the term "Corporation" shall thereafter be
deemed to refer to such Principal Party, it being specifically
intended that the provisions of Section 11 hereof shall apply
only to such Principal Party following the first occurrence of
a Section 13 Event; and (iv) such Principal Party shall take
such steps (including, but not limited to, the reservation of
a sufficient number of its Common Shares) in connection with
the consummation of any such transaction 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.
13.2 "Principal Party" shall mean:
13.2.1 in the case of any transaction described in
clause (x) or (y) of the first sentence of Section 13.1, the
Person that is the issuer of any securities into which Common
Shares of the Corporation are converted in such merger or
consolidation, and if no securities are so issued, the Person
that is the other party to such merger or consolidation
(including, if applicable, the Corporation if it is the
surviving corporation); and
13.2.2 in the case of any transaction described in
clause (z) of the first sentence of Section 13.1, the Person
that is the party receiving the greatest portion of the assets
or earning power transferred pursuant to such transaction or
transactions;
<PAGE>
provided, however, that in any of the foregoing cases, (1) if
the Common Shares of such Person are not at such time and have
not been continuously over the preceding twelve (12) month
period registered under Section 12 of the Exchange Act, and
such Person is a direct or indirect Subsidiary of another
Person the Common Shares of which are and have been so
registered, "Principal Party" shall refer to such other
Person; (2) in case such Person is a Subsidiary, directly or
indirectly, of more than one Person, the Common Shares of two
or more of which are and have been so registered, "Principal
Party" shall refer to whichever of such Persons is the issuer
of the Common Shares having the greatest aggregate market
value; and (3) in case such Person is owned, directly or
indirectly, by a joint venture formed by two or more Persons
that are not owned, directly or indirectly, by the same
Person, the rules set forth in (1) and (2) above shall apply
to each of the chains of ownership having an interest in such
joint venture as if such party were a "Subsidiary" of both or
all of such joint venturers and the Principal Parties in each
such chain shall bear the obligations set forth in this
Section 13 in the same ratio as their direct or indirect
interests in such Person bear to the total of such interests.
13.3 The Corporation shall not consummate any such
consolidation, merger, sale or transfer unless the Principal
Party shall have a sufficient number of its authorized Common
Shares that have not been issued or reserved for issuance to
permit the exercise in full of the Rights in accordance with
this Section 13 and unless prior thereto the Corporation and
such Principal Party shall have executed and delivered to the
Rights Agent a supplemental agreement providing for the terms
set forth in Sections 13.1 and 13.2 and further providing
that, as soon as practicable after the date of any
consolidation, merger, sale or transfer mentioned in Section
13.1, the Principal Party at its own expense shall:
13.3.1 prepare and file a registration statement
under the Act with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate
form, and will use its best efforts to cause such registration
statement to (A) become effective as soon as practicable after
such filing and (B) remain effective (with a prospectus at all
times meeting the requirements of the Act) until the Final
Expiration Date;
13.3.2 use its best efforts to qualify or register
the Rights and the securities purchasable upon exercise of the
Rights under the blue sky laws of such jurisdictions as may be
necessary or appropriate; and
13.3.3 deliver to holders of the Rights historical
financial statements for the Principal Party that comply in
all respects with the requirements for registration on Form 10
under the Exchange Act.
<PAGE>
The provisions of this Section 13 shall similarly
apply to successive mergers or consolidations or sales or
other transfers. The rights under this Section 13 shall be in
addition to the rights to exercise Rights and adjustments
under Section 11.1.2 and shall survive any exercise thereof.
13.4 Notwithstanding anything in this Agreement to the
contrary, the foregoing provisions of this Section 13 shall
not be applicable to a transaction described in clauses (x)
and (y) of Section 13.1 if: (i) such transaction is
consummated with a Person or Persons who acquired Common
Shares pursuant to a Permitted Offer (or a wholly owned
Subsidiary of any such Person or Persons); (ii) the price per
Common Share offered in such transaction is not less than the
price per Common Share paid to all holders of Common Shares
whose shares were purchased pursuant to such Permitted Offer;
and (iii) the form of consideration offered in such
transaction is the same as the form of consideration paid
pursuant to such Permitted Offer. Upon consummation of any
such transaction contemplated by this Section 13.4, all Rights
hereunder shall expire.
Section 14. Fractional Rights and Fractional Shares.
14.1 The Corporation shall not be required to issue
fractions of Rights or to distribute Right Certificates that
evidence fractional Rights. In lieu of such fractional
Rights, there shall be paid to the registered holders of the
Right Certificates with regard to which such fractional Rights
would otherwise be issuable an amount in cash equal to the
same fraction of the current market value of a whole Right.
For the purposes of this Section 14.1, the current market
value of a whole Right shall be the closing price of the
Rights for the Trading Day immediately prior to the date on
which such fractional Rights would have been otherwise
issuable. The closing price for any day shall be the last
sale price, regular way, or, in case no such sale takes place
on such day, the average of the closing bid and asked prices,
regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to
securities listed or admitted to trading on the New York Stock
Exchange or, if the Rights are not listed or admitted to
trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with
respect to securities listed on the principal national
securities exchange on which the Rights are listed or admitted
to trading or, if the Rights are not listed or admitted to
trading on any national securities exchange, the last quoted
price or, if not so quoted, the average of the high bid and
low asked prices in the over-the-counter market, as reported
by NASDAQ or such other system then in use or, if on any such
date the Rights are not quoted by any such organization, the
average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights
<PAGE>
selected by the Board of Directors of the Corporation. If on
any such date no such market maker is making a market in the
Rights, the fair value of the Rights on such date as
determined in good faith by the Board of Directors of the
Corporation shall be used.
14.2 The Corporation shall not be required to issue
fractions of Preferred Shares (other than fractions that are
one one-thousandth (1/1000th) or integral multiples of one
one-thousandth (1/1000th) of a Preferred Share) upon exercise
of the Rights or to distribute certificates that evidence
fractional Preferred Shares (other than fractions that are one
one-thousandth (1/1000th) or integral multiples of one one-
thousandth (1/1000th) of a Preferred Share). Fractions of
Preferred Shares in integral multiples of one one-thousandth
(1/1000th) of a Preferred Share may, at the election of the
Corporation, be evidenced by depositary receipts, pursuant to
an appropriate agreement between the Corporation and a
depositary selected by it; provided that such agreement shall
provide that the holders of such depositary receipts shall
have the rights, privileges and preferences to which they are
entitled as beneficial owners of the Preferred Shares
represented by such depositary receipts. In lieu of
fractional Preferred Shares that are not one one-thousandth
(1/1000th) or integral multiples of one one-thousandth
(1/1000th) of a Preferred Share, the Corporation shall pay to
the registered holders of Right Certificates at the time such
Rights are exercised as herein provided an amount in cash
equal to the same fraction of the current market value of one
Preferred Share. For the purposes of this Section 14.2, the
current market value of a Preferred Share shall be the closing
price of a Preferred Share (as determined pursuant to Section
11.4.2 hereof) for the Trading Day immediately prior to the
date of such exercise.
14.3 Following the occurrence of one of the transactions
or events specified in Section 11 giving rise to the right to
receive Common Shares, Capital Stock Equivalents (other than
Preferred Shares) or other securities upon the exercise of a
Right, the Corporation shall not be required to issue
fractions of shares or units of such Common Shares, Capital
Stock Equivalents or other securities upon exercise of the
Rights or to distribute certificates that evidence fractions
of such Common Shares, Capital Stock Equivalents or other
securities. In lieu of fractional shares or units of such
Common Shares, Capital Stock Equivalents or other securities,
the Corporation may pay to the registered holders of Right
Certificates at the time such Rights are exercised as herein
provided an amount in cash equal to the same fraction of the
current market value of a share or unit of such Common Shares,
Capital Stock Equivalents or other securities. For purposes
of this Section 14.3, the current market value shall be
determined in the manner set forth in Section 11.4 hereof for
the Trading Day immediately prior to the date of such exercise
<PAGE>
and, if such Capital Stock Equivalent is not traded, each such
Capital Stock Equivalent shall have the value of one one-
thousandth (1/1000th) of a Preferred Share.
14.4 The holder of a Right by the acceptance of the
Right expressly waives such holders's right to receive any
fractional Rights or any fractional share upon exercise of a
Right (except as provided above).
Section 15. Rights of Action.
15.1 All rights of action in respect of this Agreement,
excepting the rights of action given to the Rights Agent under
Section 18 hereof, are vested in the respective registered
holders of the Right Certificates (and, prior to the
Distribution Date, the registered holders of the Common
Shares); and any registered holder of any Right Certificate
(or, prior to the Distribution Date, of the Common Shares),
without the consent of the Rights Agent or of the holder of
any other Right Certificate (or, prior to the Distribution
Date, of the Common Shares), may, in such registered holder's
own behalf and for such registered holder's own benefit,
enforce, and may institute and maintain any suit, action or
proceeding against the Corporation to enforce, or otherwise
act in respect of, such registered holder's right to exercise
the Rights evidenced by such Right Certificate in the manner
provided in such Right Certificate and in this Agreement.
Without limiting the foregoing or any remedies available to
the holders of Rights, it is specifically acknowledged that
the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and will be entitled to
specific performance of the obligations under, and injunctive
relief against actual or threatened violations of the
obligations of any Person subject to, this Agreement. Nothing
in this Section 15 is intended to modify or limit the
authority of the Board of Directors under Section 25.3.
Section 16. Agreement of Right Holders.
Every holder of a Right, by accepting the same, consents
and agrees with the Corporation and the Rights Agent and with
every other holder of a Right that:
16.1 prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the
Common Shares;
16.2 after the Distribution Date, the Right Certificates
are transferable only on the registry books of the Rights
Agent if surrendered at the principal office or offices of the
Rights Agent designated for such purpose, duly endorsed or
accompanied by a proper instrument of transfer and with the
appropriate form fully executed;
<PAGE>
16.3 subject to Section 6 and Section 7.7 hereof, the
Corporation 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 Certificate or the associated Common
Shares certificate made by anyone other than the Corporation
or the Rights Agent) for all purposes whatsoever, and neither
the Corporation nor the Rights Agent, subject to the last
sentence of Section 7.6 hereof, shall be required to be
affected by any notice to the contrary; and
16.4 notwithstanding anything in this Agreement to the
contrary, neither the Corporation nor the Rights Agent shall
have any liability to any holder of a Right or a beneficial
interest in a Right or other Person as a result of its
inability to perform any of its obligations under this
Agreement by reason of any preliminary or permanent injunction
or other order, decree or ruling issued by a court of
competent jurisdiction or by a governmental, regulatory or
administrative agency or commission, or any statute, rule,
regulation or executive order promulgated or enacted by any
governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, that the
Corporation must use its best efforts to have any such order,
decree or ruling lifted or otherwise overturned as soon as
practicable.
Section 17. Right Certificate Holder Not Deemed a
Stockholder.
No holder, as such, of any Right Certificate shall be
entitled to vote, receive dividends or be deemed for any
purpose the holder of the Preferred Shares or any other
securities of the Corporation that may at any time be issuable
on the exercise of the Rights represented thereby, nor shall
anything contained herein or in any Right Certificate be
construed to confer upon the holder of any Right Certificate,
as such, any of the rights of a stockholder of the Corporation
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 Section 24 hereof), or to
receive dividends or other distributions or to exercise any
preemptive or subscription rights, or otherwise, until the
Right or Rights evidenced by such Right Certificate shall have
been exercised in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent.
18.1 The Corporation agrees to pay to the Rights Agent
reasonable compensation for all services rendered by it
<PAGE>
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 Corporation also agrees to indemnify the
Rights Agent for, and to hold it harmless against, any loss,
liability or expense incurred without negligence, bad faith or
willful misconduct on the part of the Rights Agent, for
anything done or omitted by the Rights Agent in connection
with the acceptance and administration of this Agreement,
including the costs and expenses of defending against any
claim of liability in the premises. The indemnity provided
for herein shall survive the expiration of the Rights and the
termination of this Agreement.
18.2 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 Common Shares or for other securities of the
Corporation, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction,
consent, certificate, statement or other paper or document
believed by it to be genuine and to be signed, executed and,
where necessary, verified or acknowledged, by the proper
Person or Persons.
18.3 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 the action.
Section 19. Merger or Consolidation or Change of Name
of Rights Agent.
19.1 Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor
Rights Agent shall be a party, or any corporation succeeding
to the stock transfer or all or substantially all of 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 21 hereof. In case at the time such successor
Rights Agent shall succeed to the agency created by this
Agreement, any of the Right Certificates shall have been
countersigned but not delivered, any such successor Rights
Agent may adopt the countersignature of a predecessor Rights
<PAGE>
Agent and deliver such Right Certificates so countersigned;
and in case at that time any of the Right Certificates shall
not have been countersigned, any successor Rights Agent may
countersign such Right Certificates either in the name of the
predecessor or in the name of the successor Rights Agent; and
in all such cases such Right Certificates shall have the full
force provided in the Right Certificates and in this
Agreement.
19.2 In case at any time the name of the Rights Agent
shall be changed and at such time any of the Right
Certificates shall have been countersigned but not delivered,
the Rights Agent may adopt the countersignature under its
prior name and deliver Right Certificates so countersigned;
and in case at that time any of the Right Certificates shall
not have been countersigned, the Rights Agent may countersign
such Right Certificates either in its prior name or in its
changed name; and in all such cases such Right Certificates
shall have the full force provided in the Right Certificates
and in this Agreement.
Section 20. Duties of Rights Agent.
The Rights Agent undertakes only those duties and
obligations imposed by this Agreement upon the following terms
and conditions, by all of which the Corporation and the
holders of Right Certificates, by their acceptance thereof,
shall be bound:
20.1 The Rights Agent may consult with legal counsel
(who may be legal counsel for the Corporation), 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.
20.2 Whenever in the performance of its duties under
this Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter (including, without
limitation, the identity of an Acquiring Person and the
determination of the current market price of any security) be
proved or established by the Corporation prior to taking or
suffering any action hereunder, such fact or matter (unless
other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and
established by a certificate signed by any one of the Chairman
of the Board, the Chief Executive Officer, the President, any
Vice President, the Treasurer or the Secretary of the
Corporation 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.
<PAGE>
20.3 The Rights Agent shall be liable hereunder only for
its own negligence, bad faith or willful misconduct.
20.4 The Rights Agent shall not be liable for, or by
reason of, any of the statements of fact or recitals contained
in this Agreement or in the Right Certificates (except its
countersignature on such Right Certificates) or be required to
verify the same, but all such statements and recitals are and
shall be deemed to have been made by the Corporation only.
20.5 The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or
the execution and delivery hereof (except the due execution
hereof by the Rights Agent) or in respect of the validity or
execution of any Right Certificate (except its
countersignature thereof); nor shall it be responsible for any
breach by the Corporation of any covenant or condition
contained in this Agreement or in any Rights Certificate; nor
shall it be responsible for any change in the exercisability
of the Rights (including the Rights becoming void pursuant to
Section 7.6 hereof) or any adjustment required under the
provisions of Section 11 or Section 13 hereof or responsible
for the manner, method or amount of any such adjustment or the
ascertaining of the existence of facts that would require any
such adjustment (except with respect to the exercise of Rights
evidenced by Right Certificates after receipt of the
certificate described in Section 12 hereof); 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
validly authorized and issued, fully paid and non-assessable.
20.6 The Corporation 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.
20.7 The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its
duties hereunder from any one of the Chairman of the Board,
the Chief Executive Officer, the President, any Vice
President, the Treasurer or the Secretary of the Corporation,
and to apply to such officers for advice or instructions in
connection with its duties, and shall not be liable for any
action taken or suffered by it in good faith or lack of action
in accordance with instructions of any such officer or for any
delay in acting while waiting for those instructions. Any
application by the Rights Agent for written instructions from
the Corporation may, at the option of the Rights Agent, set
<PAGE>
forth in writing any action proposed to be taken or omitted by
the Rights Agent under this Agreement and the date on or after
which such action shall be taken or such omission shall be
effective. The Rights Agent shall not be liable for any
action taken by, or omission of, the Rights Agent in
accordance with a proposal included in any such application on
or after the date specified in such application (which date
shall not be less than five (5) Business Days after the date
any officer of the Corporation actually receives such
application, unless any such officer shall have consented in
writing to an earlier date) unless, prior to taking any such
action (or the effective date in the case of an omission), the
Rights Agent shall have received written instruction in
response to such application specifying the action to be taken
or omitted.
20.8 The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal
in any of the Rights or other securities of the Corporation or
become pecuniarily interested in any transaction in which the
Corporation may be interested, or contract with or lend money
to the Corporation 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 Corporation or for any other legal
entity.
20.9 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, negligence or misconduct of
any such attorneys or agents or for any loss to the
Corporation resulting from any such act, default, negligence
or misconduct, provided reasonable care was exercised in the
selection and continued employment thereof.
20.10 No provision of this Agreement shall require the
Rights Agent to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its
duties hereunder or in the exercise of its rights if there
shall be reasonable grounds for believing that repayment of
such funds or adequate indemnification against such risk or
liability is not reasonably assured to it.
20.11 If, with respect to any Rights Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate attached to the form of assignment or form of
election to purchase, as the case may be, has not been
completed, the Rights Agent shall not take any further action
with respect to such requested exercise or transfer without
first consulting with the Corporation.
<PAGE>
Section 21. Change of Rights Agent.
The Rights Agent or any successor Rights Agent may resign
and be discharged from its duties under this Agreement upon
thirty (30) days' notice in writing mailed to the Corporation
and to each transfer agent of the Common Shares or Preferred
Shares by registered or certified mail, and to the holders of
the Right Certificates by first-class mail. The Corporation
may remove the Rights Agent or any successor Rights Agent upon
sixty (60) days' notice in writing, mailed to the Rights Agent
or successor Rights Agent, as the case may be, and to each
transfer agent of the Common Shares or Preferred Shares by
registered or certified mail, and to holders of the Right
Certificates by first-class mail. If the Rights Agent shall
resign or be removed or shall otherwise become incapable of
acting, the Corporation shall appoint a successor to the
Rights Agent. If the Corporation shall fail to make such
appointment within a period of sixty (60) days after giving
notice of such removal or after it has been notified in
writing of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the holder of a Right
Certificate (who shall, with such notice, submit his Right
Certificate for inspection by the Corporation), then the
registered holder of any Right Certificate may apply to any
court of competent jurisdiction for the appointment of a new
Rights Agent. Any successor Rights Agent, whether appointed
by the Corporation or by such a court, shall be a corporation
organized and doing business under the laws of the United
States or of any of the States of New York, New Jersey or
California (or of any other state of the United States so long
as such corporation is authorized to do business as a banking
institution in any of the States of New York, New Jersey or
California), in good standing, having an office in any of such
States, which is authorized under such laws to exercise
corporate trust or stock transfer powers and is subject to
supervision or examination by federal or state authority and
which (or the parent corporation of which) has at the time of
its appointment as Rights Agent a combined capital and surplus
of at least $100,000,000. 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
Corporation shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Common
Shares or Preferred Shares, and mail a notice thereof in
writing to the registered holders of the Right Certificates.
Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality
or validity of the resignation or removal of the Rights Agent
<PAGE>
or the appointment of the successor Rights Agent, as the case
may be.
Section 22. Issuance of New Right Certificates.
22.1 Notwithstanding any of the provisions of this
Agreement or of the Rights to the contrary, the Corporation
may, at its option, issue new Right Certificates evidencing
Rights in such form as may be approved by its Board of
Directors to reflect any adjustment or change in the Purchase
Price and the number or kind or class of shares or other
securities or property purchasable under the Right
Certificates made in accordance with the provisions of this
Agreement.
22.2 In connection with the issuance or sale of Common
Shares following the Distribution Date and prior to the
earlier of the Redemption Date and the Final Expiration Date,
the Corporation (a) shall with respect to Common Shares so
issued or sold pursuant to the exercise of stock options or
under any employee plan or arrangement, or upon the exercise,
conversion or exchange of securities, notes or debentures
issued by the Corporation, and (b) may in any other case, if
deemed necessary or appropriate by the Board of Directors of
the Corporation, issue Right Certificates representing the
appropriate number of Rights in connection with such issuance
or sale; provided, however, that (i) the Corporation shall
not be obligated to issue any such Right Certificates if, and
to the extent that, the Corporation shall be advised by
counsel that such issuance would create a significant risk of
material adverse tax consequences to the Corporation or the
Person to whom such Right Certificate would be issued, and
(ii) no Right Certificate shall be issued if, and to the
extent that, appropriate adjustment shall otherwise have been
made in lieu of the issuance thereof.
Section 23. Redemption and Termination.
23.1 Redemption
23.1.1 The Board of Directors of the Corporation
may, at its option, redeem all but not less than all of the
then outstanding Rights at a redemption price of $.01 per
Right, as such amount may be appropriately adjusted to reflect
any stock split, stock dividend or similar transaction
occurring after the date hereof (such redemption price being
hereinafter referred to as the "Redemption Price"), at any
time prior to the earlier of the occurrence of a Section
11.1.2 Event or the Final Expiration Date. The Corporation
may, at its option, pay the Redemption Price either in Common
Shares (based on the current per share market price of the
Common Shares at the time of redemption) or cash; provided
that if the Corporation elects to pay the Redemption Price in
Common Shares, the Corporation shall not be required to issue
<PAGE>
any fractional Common Shares and the number of Common Shares
issuable to each holder of Rights shall be rounded down to the
next whole share.
23.1.2 In addition, the Board of Directors of the
Corporation may, at its option, at any time following the
occurrence of a Section 11.1.2 Event and the expiration of any
period during which the holder of Rights may exercise the
Rights under Section 11.1.2 but prior to any Section 13 Event
redeem all but not less than all of the then outstanding
Rights at the Redemption Price (x) in connection with any
merger, consolidation or sale or other transfer (in one
transaction or in a series of related transactions) of assets
or earning power aggregating 50% or more of the earning power
of the Corporation and its Subsidiaries (taken as a whole) in
which all holders of Common Shares are treated alike and not
involving (other than as a holder of Common Shares being
treated like all other such holders) an Interested Stockholder
or (y) (i) if and for so long as the Acquiring Person is not
thereafter the Beneficial Owner of 15% or more of the Common
Shares, and (ii) at the time of redemption no other Persons
are Acquiring Persons.
23.2 In the case of a redemption permitted under
Section 23.1.1, immediately upon the date for redemption set
forth in (or determined in the manner specified in) a
resolution of the Board of Directors of the Corporation
ordering the redemption of the Rights, evidence of which shall
have been filed with the Rights Agent, and without any further
action and without any notice, the right to exercise the
Rights will terminate and the only right thereafter of the
holders of Rights shall be to receive the Redemption Price for
each Right so held. In the case of a redemption permitted
only under Section 23.1.2, evidence of which shall have been
filed with the Rights Agent, the right to exercise the Rights
will terminate and represent only the right to receive the
Redemption Price upon the later of ten (10) Business Days
following the giving of such notice or the expiration of any
period during which the Rights may be exercised under
Section 11.1.2. The Corporation shall promptly give public
notice of any such redemption; provided, however, that the
failure to give, or any defect in, any such notice shall not
affect the validity of such redemption. Within ten (10) days
after such date for redemption set forth in a resolution of
the Board of Directors of the Corporation ordering the
redemption of the Rights, the Corporation shall mail a notice
of redemption to all the holders of the then outstanding
Rights at their addresses as they appear upon the registry
books of the Rights Agent or, prior to the Distribution Date,
on the registry books of the transfer agent for the Common
Shares. Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of redemption will
state the method by which the payment of the Redemption Price
<PAGE>
will be made. Neither the Corporation nor any of its
Affiliates or Associates may redeem, acquire or purchase for
value any Rights at any time in any manner other than as
specifically set forth in this Section 23 and other than in
connection with the purchase of Common Shares prior to the
Distribution Date.
23.3 The Corporation may, at its option, discharge all
of its obligations with respect to the Rights by (i) issuing a
press release announcing the manner of redemption of the
Rights in accordance with this Agreement and (ii) mailing
payment of the Redemption Price to the registered holders of
the Rights at their addresses as they appear on the registry books
of the Rights Agent or, prior to the Distribution Date, on
the registry books of the Transfer Agent of the Common Shares,
and upon such action, all outstanding Rights and Right
Certificates shall be null and void without any further action by
the Corporation.
Section 24. Notice of Certain Events.
24.1 In case the Corporation shall propose (i) to pay
any dividend payable in stock of any class to the holders of
its Preferred Shares or to make any other distribution to the
holders of its Preferred Shares (other than a regular
quarterly cash dividend), (ii) to offer to the holders of its
Preferred Shares rights or warrants to subscribe for or to
purchase any additional Preferred Shares or shares of stock of
any class or any other securities, rights or options, (iii) to
effect any reclassification of its Preferred Shares (other
than a reclassification involving only the subdivision of
outstanding Preferred Shares), (iv) to effect any
consolidation or merger into or with any other Person (other
than a Subsidiary of the Corporation in a transaction which
does not violate Section 11.14 hereof), or to effect any sale
or other transfer (or to permit one or more of its
Subsidiaries to effect any sale or other transfer) in one or
more transactions, of 50% or more of the assets or earning
power of the Corporation and its Subsidiaries (taken as a
whole) to any other Person or Persons (other than the
Corporation and/or any of its Subsidiaries in one or more
transactions each of which does not violate Section 11.14
hereof), or (v) to effect the liquidation, dissolution or
winding up of the Corporation, then, in each such case, the
Corporation shall give to each holder of a Right Certificate,
in accordance with Section 25 hereof, a notice of such
proposed action to the extent feasible and file a certificate
with the Rights Agent to that effect, which shall specify the
record date for the purposes of such stock dividend or
distribution of rights or warrants, or the date on which such
reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution or winding up is to take place and
the date of participation therein by the holders of the
Preferred Shares, if any such date is to be fixed, and such
<PAGE>
notice shall be so given in the case of any action covered by
clause (i) or (ii) above at least twenty (20) days prior to
the record date for determining holders of the Preferred
Shares for purposes of such action, and in the case of any
such other action, at least twenty (20) days prior to the date
of the taking of such proposed action or the date of
participation therein by the holders of the Preferred Shares,
whichever shall be the earlier.
24.2 In case of a Section 11.1.2 Event, then (i) the
Corporation shall as soon as practicable thereafter give to
each holder of a Right Certificate, in accordance with
Section 25.1.3 hereof, a notice of the occurrence of such
event, which notice shall describe such event and the
consequences of such event to holders of Rights under
Section 11.1.2 hereof, and (ii) all references in the
preceding Section 24.1 to Preferred Shares shall be deemed
thereafter to refer also to Common Shares and/or, if
appropriate, other securities of the Corporation.
Section 25. Miscellaneous.
25.1 Notices.
25.1.1 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 Corporation 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:
Teledyne, Inc.
1901 Avenue of the Stars
Los Angeles, California 90067-6046
Attention: Corporate Secretary
25.1.2 Subject to the provisions of Section 21
hereof, any notice or demand authorized by this Agreement to
be given or made by the Corporation 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 Corporation) as follows:
Chemical Trust Company of California
300 South Grand Avenue
Fourth Floor
Los Angeles, California 90071
Attention: Administration
25.1.3 Notices or demands authorized by this
Agreement to be given or made by the Corporation or the Rights
Agent to the holder of any Right Certificate or, if prior to
the Distribution Date, to the holder of certificates
<PAGE>
representing Common Shares shall be sufficiently given or made
if sent by first-class mail, postage prepaid, addressed to
such holder at the address of such holder as shown on the
registry books of the Corporation.
25.2 Supplements and Amendments. The Corporation may
from time to time supplement or amend any provision of this
Agreement without the approval of any holders of Rights in
order to cure any ambiguity, to correct or supplement any
provision herein, or to make any other provision with respect
to the Rights which the Corporation may deem necessary or
desirable, any such supplement or amendment to be evidenced by
a writing signed by the Corporation and the Rights Agent;
provided, however, that from and after any Shares Acquisition
Date this Agreement shall not be amended in any manner which
will adversely affect the interests of the holders of Rights.
Upon the delivery of a certificate from an appropriate officer
of the Corporation which states that the proposed supplement
or amendment is in compliance with the terms of this
Section 25.2, the Rights Agent shall execute such supplement
or amendment, provided that such supplement or amendment does
not adversely affect the rights or obligations of the Rights
Agent under Section 18 or Section 20 of this Agreement. Prior
to the Distribution Date, the interests of the holders of
Rights shall be deemed coincident with the interests of the
holders of Common Shares.
25.3 Determination and Actions by the Board of
Directors, etc. The Board of Directors of the Corporation
shall have the exclusive power and authority to administer
this Agreement and to exercise all rights and powers
specifically granted to the Board, or the Corporation, or as
may be necessary or advisable in the administration of this
Agreement, including without limitation, the right and power
to (i) interpret the provisions of this Agreement, and
(ii) make all determinations deemed necessary or advisable for
the administration of this Agreement (including, without
limitation, a determination to redeem or not redeem the Rights
or to amend the Agreement and whether any proposed amendment
adversely affects the interests of the holders of Right
Certificates). For all purposes of this Agreement, any
calculation of the number of Common Shares or other securities
outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding
Common Shares or any other securities of which any Person is
the Beneficial Owner, shall be made in accordance with the
last sentence of Rule 13d-3(d)(1)(i) of the General Rules and
Regulations under the Exchange Act as in effect on the date of
this Agreement. All such actions, calculations,
interpretations and determinations (including, for purposes of
clause (y) below, all omissions with respect to the foregoing)
which are done or made by the Board in good faith, shall
(x) be final, conclusive and binding on the Corporation, the
Rights Agent, the holders of the Right Certificates and all
<PAGE>
other parties, and (y) not subject the Board to any liability
to the holders of the Right Certificates. Nothing in
Section 15 hereof is intended to modify or limit this
Section 25.3.
25.4 Successors. All the covenants and provisions of
this Agreement by or for the benefit of the Corporation or the
Rights Agent shall bind and inure to the benefit of their
respective successors and assigns hereunder.
25.5 Benefits of this Agreement. Nothing in this
Agreement shall be construed to give to any person or
corporation other than the Corporation, the Rights Agent and
the registered holders of the Right Certificates (and, prior
to the Distribution Date, the Common Shares) any legal or
equitable right, remedy or claim under this Agreement. This
Agreement shall be for the sole and exclusive benefit of the
Corporation, the Rights Agent and the registered holders of
the Right Certificates (and, prior to the Distribution Date,
the Common Shares).
25.6 Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected,
impaired or invalidated.
25.7 Governing Law. This Agreement, each Right and each
Right Certificate issued hereunder shall be deemed to be a
contract made under the laws of the State of Delaware and for
all purposes shall be governed by and construed in accordance
with the laws of such State applicable to contracts to be made
and performed entirely within such State.
25.8 Counterparts. This Agreement may be executed in
any number of counterparts and each of such counterparts shall
for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same
instrument.
25.9 Descriptive Headings. Descriptive headings of the
several sections of this Agreement are inserted for
convenience only and shall not control or affect the meaning
or construction of any of the provisions hereof.
Section 26. Exchange.
26.1 Notwithstanding any other provision hereof, the
Board of Directors of the Corporation may, at its option, at
any time after any Person becomes an Acquiring Person,
exchange all or part of the then outstanding and exercisable
Rights (which shall not include Rights that have become void
<PAGE>
pursuant to the provisions of Section 7.6 hereof) for Common
Shares of the Corporation at an exchange ratio determined by
dividing the then-applicable exercise price of the Rights
determined under Section 7.2 by the "current per share market
price" as defined in Section 11.4.1 (such exchange ratio being
hereinafter referred to as the "Exchange Ratio").
Notwithstanding the foregoing, the Board of Directors shall
not be empowered to effect such exchange at any time after any
Person (other than the Corporation, any Subsidiary of the
Corporation, any employee benefit plan of the Corporation or
any such Subsidiary, any Person or entity holding Common
Shares for or pursuant to the terms of any such plan or any
trustee, administrator or fiduciary of such a plan), together
with all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 50% or more of the Common Shares then
outstanding.
26.2 Immediately upon the action of the Board of
Directors of the Corporation ordering the exchange of any
Rights pursuant to Section 26.1 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 (other than a holder of Rights that have become
void pursuant to the provisions of Section 7.6 hereof) shall
be to receive that number of Common Shares equal to the number
of such Rights held by such holder multiplied by the Exchange
Ratio. The Corporation shall promptly give public notice of
any such exchange; provided, however, that the failure to
give, or any defect in, such notice shall not affect the
validity of such exchange. The Corporation promptly shall
mail a notice of any such exchange to all of the holders of
such Rights at their last addresses as they appear upon the
registry books of the Rights Agent. Any notice which is
mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice. Each such
notice of exchange shall state the method by which the
exchange of the Common Shares for Rights will be effected and,
in the event of any partial exchange, the number of Rights
which will be exchanged. Any partial exchange shall be
effected pro rata based on the number of Rights (other than
Rights which have become void pursuant to the provisions of
Section 7.6) held by each holder of Rights.
26.3 In the event that there shall not be sufficient
Common Shares issued but not outstanding or authorized but
unissued to permit any exchange of Rights as contemplated in
accordance with this Section 26, the Corporation shall take
all such action as may be necessary to authorize additional
Common Shares or Preferred Shares for issuance upon exchange
of the Rights.
[REST OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be duly executed and attested, all as of the
date and year first above written.
TELEDYNE, INC
Attest:
By: /S/ Judith R. Nelson By: /S/ William P. Rutledge
--------------------- -----------------------
Name: Judith R. Nelson Name: William P. Rutledge
Title: Secretary Title: Chairman and Chief
Executive Officer
CHEMICAL TRUST COMPANY OF
CALIFORNIA
Attest:
By: /S/ James Kirkland By: /S/ Sharon Magidson
---------------------- -----------------------
Name: James Kirkland Name: Sharon Magidson
Title: Assistant Vice Title: Vice President
President
<PAGE>
Exhibit A
Form of
Certificate of Designation, Preferences and
Rights of Series D Preferred Stock
of
Teledyne, Inc.
(Pursuant to Section 151
of the Delaware General Corporation Law)
I, Judith R. Nelson, Secretary of Teledyne, Inc. (the
"Corporation"), a corporation organized and existing under the
General Corporation Law of the State of Delaware, in
accordance with the provisions of Section 103 thereof, DO
HEREBY CERTIFY:
That pursuant to the authority conferred upon the Board
of Directors of the Corporation by the Restated Certificate of
Incorporation of the Corporation, the said Board of Directors
on January 4, 1995, adopted the following resolutions creating
a series of 100,000 shares of Preferred Stock designated as
Series D Preferred Stock.
RESOLVED, that pursuant to the authority granted to and
vested in the Board of Directors of the Corporation in
accordance with the provisions of the Restated Certificate of
Incorporation of the Corporation, the Board of Directors
hereby creates a series of Series D Preferred Stock, with a
par value of $1.00 per share, of the Corporation and hereby
states the designation and number of shares, and fixes the
relative rights, preferences and limitations thereof as
follows (the following provisions being intended to operate in
substitution for all of the provisions that would otherwise be
applicable to any series of Preferred Stock under Sections A.1
through A.6 of Article FOURTH of the Corporation's Restated
Certificate of Incorporation but being intended to operate in
addition to any other provisions of said Restated Certificate
of Incorporation applicable to any series of Preferred Stock):
Series D Preferred Stock
Section 1. Designation, Par Value and Amount. The
shares of such series shall be designated as "Series D
Preferred Stock" (hereinafter referred to as "Series D
<PAGE>
Preferred Stock"), the shares of such series shall be with
par value of $1.00 per share, and the number of shares
constituting such series shall be 100,000; provided, however,
that, if more than a total of 100,000 shares of Series D
Preferred Stock shall be issuable upon the exercise of Rights
(the "Rights") issued pursuant to the Rights Agreement, dated
as of January 4, 1995, between the Corporation and Chemical
Trust Company of California, as Rights Agent (as amended from
time to time, the "Rights Agreement"), the Board of Directors
of the Corporation shall direct by resolution or resolutions
that a certificate be properly executed, acknowledged and
filed providing for the total number of shares of Series D
Preferred Stock authorized to be issued to be increased (to
the extent that the Certificate of Incorporation then permits)
to the largest number of whole shares (rounded up to the
nearest whole number) issuable upon exercise of the Rights.
Section 2. Dividends and Distributions.
2.1 Subject to the prior and superior rights of the
holders of any shares of any series of Preferred Stock ranking
prior and superior to the shares of Series D Preferred Stock
with respect to dividends, the holders of shares of Series D
Preferred Stock shall be entitled to receive, when, as and if
declared by the Board of Directors out of assets legally
available for the purpose, quarterly dividends payable in cash
on the first business day of March, June, September and
December in each year (each such date being referred to herein
as a "Quarterly Dividend Payment Date"), commencing on the
first Quarterly Dividend Payment Date after the first issuance
of a share or fraction of a share of Series D Preferred Stock,
in an amount per share (rounded to the nearest cent) equal to
the greater of (a) $1.00 or (b) subject to the provision for
adjustment set forth in Section 6.1, 1,000 times the aggregate
per share amount of all cash dividends, and 1,000 times the
aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions other than a dividend payable
in shares of Common Stock, par value $1.00 per share, of the
Corporation (the "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 D
Preferred Stock.
2.2 The Corporation shall declare a dividend or
distribution on the Series D Preferred Stock as provided in
Section 2.1 above immediately after it declares a dividend or
distribution on the Common Stock (other than a dividend
payable in shares of Common Stock); provided that, in the
event no dividend or distribution shall have been declared on
the Common Stock during the period between any Quarterly
Dividend Payment Date and the next subsequent Quarterly
<PAGE>
Dividend Payment Date, a dividend of $1.00 per share on the
Series D Preferred Stock shall nevertheless be payable on such
subsequent Quarterly Dividend Payment Date.
2.3 Dividends shall begin to accrue and be cumulative on
outstanding shares of Series D Preferred Stock from the
Quarterly Dividend Payment Date next preceding the date of
issue of such shares of Series D Preferred Stock, unless the
date of issue of such shares is prior to the record date for
the first Quarterly Dividend Payment Date, in which case
dividends on such shares shall begin to accrue from the date
of issue of such shares, or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series D
Preferred Stock entitled to receive a quarterly dividend and
before such Quarterly Dividend Payment Date, in either of
which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued
but unpaid dividends shall not bear interest. Dividends paid
on the shares of Series D Preferred Stock in an amount less
than the total amount of such dividends at the time accrued
and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for
the determination of holders of shares of Series D Preferred
Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be not
more than 30 days prior to the date fixed for the payment
thereof.
Section 3. Voting Rights. The holders of shares of
Series D Preferred Stock shall have the following voting
rights:
3.1 Except as provided in Section 3.3 and subject to the
provision for adjustment hereinafter set forth, each share of
Series D Preferred Stock shall entitle the holder thereof to
1,000 votes on all matters submitted to a vote of the
stockholders of the Corporation.
3.2 Except as otherwise provided herein or by law, the
holders of shares of Series D Preferred Stock and the holders
of shares of Common Stock shall vote together as one class on
all matters submitted to a vote of stockholders of the
Corporation.
3.3 The following additional provisions shall apply with
respect to the voting of shares of Series D Preferred Stock:
3.3.1 If, on the date used to determine
stockholders of record for any meeting of stockholders for the
election of directors, a default in preference dividends (as
defined in Section 3.3.5 below) on the Series D Preferred
Stock shall exist, the holders of the Series D Preferred Stock
<PAGE>
shall have the right, voting as a class as described in
Section 3.3.2 below, to elect two directors (in addition to
the directors elected by holders of Common Stock of the
Corporation). Such right may be exercised (a) at any meeting
of stockholders for the election of directors or (b) at a
meeting of the holders of shares of Voting Preferred Stock (as
hereinafter defined), called for the purpose in accordance
with the Bylaws of the Corporation, until all such cumulative
dividends (referred to above) shall have been paid in full or
until non-cumulative dividends have been paid regularly for at
least one year.
3.3.2 The right of the holders of Series D
Preferred Stock to elect two directors, as described above,
shall be exercised as a class concurrently with the rights of
holders of any other series of Preferred Stock upon which
voting rights to elect such directors have been conferred and
are then exercisable. The Series D Preferred Stock and any
additional series of Preferred Stock that the Corporation may
issue and that may provide for the right to vote with the
foregoing series of Preferred Stock are collectively referred
to herein as "Voting Preferred Stock."
3.3.3 Each director elected by the holders of
shares of Voting Preferred Stock shall be referred to herein
as a "Preferred Director." A Preferred Director shall
continue to serve as such for a term of one year, except that
upon any termination of the right of all holders of Voting
Preferred Stock to vote as a class for Preferred Directors,
the term of office of Preferred Directors then serving shall
terminate. Any Preferred Director may be removed by, and
shall not be removed except by, the vote of the holders of
record of a majority of the outstanding shares of Voting
Preferred Stock then entitled to vote for the election of
directors, present (in person or by proxy) and voting together
as a single class (a) at a meeting of the stockholders, or
(b) at a meeting of the holders of shares of such Voting
Preferred Stock, called for the purpose in accordance with the
Bylaws of the Corporation, or (c) by written consent signed by
the holders of a majority of the then outstanding shares of
Voting Preferred Stock then entitled to vote for the election
of directors, taken together as a single class.
3.3.4 So long as a default in any preference
dividends of the Series D Preferred Stock shall exist or the
holders of any other series of Voting Preferred Stock shall be
entitled to elect Preferred Directors, (a) any vacancy in the
office of a Preferred Director may be filled (except as
provided in the following clause (b)) by an instrument in
writing signed by the remaining Preferred Director and filed
with the Corporation and (b) in the case of the removal of any
Preferred Director, the vacancy may be filled by the vote or
written consent of the holders of a majority of the
outstanding shares of Voting Preferred Stock then entitled to
<PAGE>
vote for the election of directors, present (in person or by
proxy) and voting together as a single class, at such time as
the removal shall be effected. Each director appointed as
aforesaid by the remaining Preferred Director shall be deemed,
for all purposes hereof, to be a Preferred Director. Whenever
(x) no default in preference dividends on the Series D
Preferred Stock shall exist and (y) the holders of other
series of Voting Preferred Stock shall no longer be entitled
to elect such Preferred Directors, then the number of
directors constituting the Board of Directors of the
Corporation shall be reduced by two.
3.3.5 For purposes hereof, a "default in preference
dividends" on the Series D Preferred Stock shall be deemed to
have occurred whenever the amount of cumulative and unpaid
dividends on the Series D Preferred Stock shall be equivalent
to six full quarterly dividends or more (whether or not
consecutive), and, having so occurred, such default shall be
deemed to exist thereafter until, but only until, all
cumulative dividends on all shares of the Series D Preferred
Stock then outstanding shall have been paid through the last
Quarterly Dividend Payment Date or until, but only until, non-
cumulative dividends have been paid regularly for at least one
year.
3.4 Except as set forth herein (or as otherwise required
by applicable law), holders of Series D Preferred Stock shall
have no general or special voting rights and their consent
shall not be required for taking any corporate action.
Section 4. Certain Restrictions.
4.1 Whenever quarterly dividends or other dividends or
distributions payable on the Series D Preferred Stock as
provided in Section 2 are in arrears, thereafter and until all
accrued and unpaid dividends and distributions, whether or not
declared, on shares of Series D Preferred Stock outstanding
shall have been paid in full, the Corporation shall not:
4.1.1 declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding
up) to the Series D Preferred Stock;
4.1.2 declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or
winding up) with the Series D Preferred Stock, except
dividends paid ratably on the Series D Preferred Stock and all
such parity stock on which dividends are payable or in arrears
in proportion to the total amounts to which the holders of all
such shares are then entitled;
<PAGE>
4.1.3 redeem or purchase or otherwise acquire for
consideration (except as provided in Section 4.1.4 below)
shares of any stock ranking junior (either as to dividends or
upon liquidation, dissolution or winding up) to the Series D
Preferred Stock, provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any such
junior stock in exchange for shares of any stock of the
Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series D
Preferred Stock;
4.1.4 redeem or purchase or otherwise acquire for
consideration any shares of Series D Preferred Stock, or any
shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series D
Preferred Stock, except in accordance with a purchase offer
made in writing or by publication (as determined by the Board
of Directors) to all holders of such shares upon such terms as
the Board of Directors, after consideration of the respective
annual dividend rates and other relative rights and
preferences of the respective series and classes, shall
determine in good faith will result in fair and equitable
treatment among the respective series or classes.
4.2 The Corporation shall not permit any subsidiary of
the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the Corporation unless
the Corporation could, under Section 4.1, purchase or
otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series D
Preferred Stock purchased or otherwise acquired by the
Corporation in any manner whatsoever shall be retired and
cancelled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but
unissued shares of Preferred Stock and may be reissued as part
of a new series of Preferred Stock subject to the conditions
and restrictions on issuance set forth herein, in the
Certificate of Incorporation, in any other Certificate of
Amendment creating a series of Preferred Stock or as otherwise
required by law.
Section 6. Liquidation, Dissolution or Winding Up.
6.1 Subject to the prior and superior rights of holders
of any shares of any series of Preferred Stock ranking prior
and superior to the shares of Series D Preferred Stock with
respect to rights upon liquidation, dissolution or winding up
(voluntary or otherwise), no distribution shall be made to the
holders of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to
the Series D Preferred Stock unless, prior thereto, the
holders of shares of Series D Preferred Stock shall have
received per share an amount equal to the greater of 1,000
<PAGE>
times $75.00 or 1,000 times the payment made per share of Common
Stock, plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the
date of such payment (the "Series D Liquidation Preference").
Following the payment of the full amount of the Series D
Liquidation Preference, no additional distributions shall be
made to the holders of shares of Series D Preferred Stock
unless, prior thereto, the holders of shares of Common Stock
shall have received an amount per share (the "Capital
Adjustment") equal to the quotient obtained by dividing
(i) the Series D Liquidation Preference by (ii) 1,000 (as
appropriately adjusted as set forth in Section 6.3 to reflect
such events as stock splits, stock dividends and
recapitalizations with respect to the Common Stock) (such
number in clause (ii) being hereafter referred to as the
"Adjustment Number"). Following the payment of the full
amount of the Series D Liquidation Preference and the Capital
Adjustment in respect of all outstanding shares of Series D
Preferred Stock and Common Stock, respectively, holders of
Series D Preferred Stock and holders of Common Stock shall
receive their ratable and proportionate share of the remaining
assets to be distributed in the ratio of the Adjustment Number
to 1 with respect to such Preferred Stock and Common Stock, on
a per share basis, respectively.
6.2 In the event, however, that there are not sufficient
assets available to permit payment in full of the Series D
Liquidation Preference and the liquidation preferences of all
other series of preferred stock, if any, which rank on a
parity with the Series D Preferred Stock, then such remaining
assets shall be distributed ratably to the holders of Series D
Preferred Stock and the holders of such parity shares in
proportion to their respective liquidation preferences. In
the event, however, that there are not sufficient assets
available to permit payment in full of the Capital Adjustment,
then such remaining assets shall be distributed ratably to the
holders of Common Stock.
6.3 In the event the Corporation shall (i) declare any
dividend on Common Stock payable in shares of Common Stock,
(ii) subdivide the outstanding Common Stock, or (iii) combine
the outstanding Common Stock into a smaller number of shares,
then in each such case the Adjustment Number in effect
immediately prior to such event shall be adjusted by
multiplying such Adjustment Number by a fraction the numerator
of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding
immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the shares of Common
Stock are exchanged for or changed into other stock or
<PAGE>
securities, cash and/or any other property, then in any such
case the shares of Series D Preferred Stock shall at the same
time be similarly exchanged or changed in an amount per share
equal to the Adjustment Number (as appropriately adjusted as
set forth in Section 6.3 to reflect such events as stock
splits, stock dividends and recapitalizations with respect to
the Common Stock) times the aggregate amount of stock,
securities, cash and/or any other property (payable in kind),
as the case may be, into which or for which each share of
Common Stock is changed or exchanged.
Section 8. No Redemption. The shares of Series D
Preferred Stock shall not be redeemable.
Section 9. Ranking. The Series D Preferred Stock shall
rank junior to all other series of the Corporation's Preferred
Stock as to the payment of dividends and the distribution of
assets, unless the terms of any such other series shall
provide otherwise.
Section 10. Amendment. The Certificate of Incorporation
of the Corporation shall not be further amended in any manner
that would materially alter or change the powers, preferences
or special rights of the Series D Preferred Stock so as to
affect them adversely without the affirmative vote of the
holders of a majority or more of the outstanding shares of
Series D Preferred Stock, voting separately as a class.
Section 11. Fractional Shares. Series D Preferred Stock
may be issued in fractions of a share which shall entitle the
holder, in proportion to such holder's fractional shares, to
exercise voting rights, receive dividends, participate in
distributions and have the benefit of all other rights of
holders of Series D Preferred Stock.
RESOLVED, that the proper officers of the Corporation be,
and each of them hereby is, authorized to execute a
Certificate of Designation with respect to the Series D
Preferred Stock pursuant to Section 151 of the General
Corporation Law of the State of Delaware and to take all
appropriate action to cause such Certificate to become
effective, including, but not limited to, the filing and
recording of such Certificate with and/or by the Secretary of
State of the State of Delaware.
<PAGE>
IN WITNESS WHEREOF, I have executed and subscribed to
this Certificate and do affirm the foregoing as true under
penalty of perjury this fourth day of January, 1995.
--------------------------------
Judith R. Nelson
Secretary
<PAGE>
Exhibit B
Form of Right Certificate
Certificate No. R- _____ Rights
NOT EXERCISABLE AFTER JANUARY 4, 2005 OR
EARLIER IF REDEEMED BY THE CORPORATION. THE
RIGHTS ARE SUBJECT TO REDEMPTION AT $.01 PER
RIGHT ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT.
Right Certificate
TELEDYNE, INC.
This certifies that __________, or registered
assigns, is the registered owner of the number of Rights set
forth above, each of which entitles the owner thereof, subject
to the terms, provisions and conditions of the Rights
Agreement, dated as of January 4, 1995 (the "Rights
Agreement"), between Teledyne, Inc., a Delaware corporation
(the "Corporation"), and Chemical Trust Company of California
(the "Rights Agent") to purchase from the Corporation 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 time,
on January 4, 2005, unless the Rights evidenced hereby shall
have been previously redeemed by the Corporation, at the
principal office or offices of the Rights Agent designated for
such purpose, or at the office of its successor as Rights
Agent, one one-thousandth (1/1000th) of a fully paid non-
assessable share of Series D Preferred Stock, $1.00 par value
per share (the "Preferred Shares"), of the Corporation, at a
purchase price of $75.00 per one one-thousandth (1/1000th) 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-thousandths
(1/1000ths) of a Preferred Share that may be purchased upon
exercise hereof) set forth above, and the Purchase Price set
forth above, are the number and Purchase Price as of
January 27, 1995, based on the Preferred Shares as constituted
at such date.
<PAGE>
Upon the occurrence of a Section 11.1.2 Event (as
such term is defined in the Rights Agreement), if the Rights
evidenced by this Right Certificate are beneficially owned by
(i) an Acquiring Person or an Affiliate or Associate of any
such Acquiring Person (as such terms are defined in the Rights
Agreement), (ii) a transferee of any such Acquiring Person,
Associate or Affiliate who becomes a transferee after the
Acquiring Person becomes such, or (iii) under certain
circumstances specified in the Rights Agreement, a transferee
of any such Acquiring Person, Associate or Affiliate who
becomes a transferee prior to or concurrently with the
Acquiring Person becoming such, 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 11.1.2 Event.
As provided in the Rights Agreement, the Purchase
Price and the number of one one-thousandths (1/1000ths) of a
Preferred Share or other securities that may be purchased upon
the exercise of the Rights evidenced by this Right Certificate
are subject to modification and adjustment upon the happening
of certain events, including Triggering Events (as such term
is defined in the Rights Agreement).
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 Corporation and
the holders of the Right Certificates, which limitations of
rights include the temporary suspension of the exercisability
of such Rights under the specific circumstances set forth in
the Rights Agreement. Copies of the Rights Agreement are on
file at the principal executive offices of the Corporation and
the principal office or offices of the Rights Agent.
This Right Certificate, with or without other Right
Certificates, upon surrender at the principal office of the
Rights Agent, may be exchanged for another Right Certificate
or Right Certificates of like tenor and date evidencing Rights
entitling the holder to purchase a like aggregate number of
Preferred Shares or other securities 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 may be redeemed by
the Corporation at a redemption price of $.01 per Right
<PAGE>
(subject to adjustment as provided in the Rights Agreement)
payable in cash.
No fractional Preferred Shares will be issued upon
the exercise of any Right or Rights evidenced hereby (other
than fractions that are one one-thousandth (1/1000th) or
integral multiples of one one-thousandth (1/1000th) of a
Preferred Share, which may, at the election of the
Corporation, 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 Corporation that may at any time be issuable
on the exercise hereof, nor shall anything contained in the
Rights Agreement or herein be construed to confer upon the
holder hereof, as such, any of the rights of a stockholder of
the Corporation 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 other
distributions or to exercise any preemptive or subscription
rights, or otherwise, until the Right or Rights evidenced by
this Right Certificate shall have been exercised as provided
in the Rights Agreement.
This Right Certificate shall not be valid or
obligatory for any purpose until it shall have been
countersigned by the Rights Agent.
<PAGE>
WITNESS the facsimile signature of the proper
officers of the Corporation and its corporate seal. Dated as
of __________, _____.
[SEAL]
ATTEST: Teledyne, Inc.
By_______________________ By_________________________
Name_____________________ Name_______________________
Title____________________ Title______________________
Countersigned:
[ ]
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 _____________________
______________________________________________________________
(Please print name and address of transferee)
______________________________________________________________
this Right Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and
appoint _______________ Attorney-in-Fact, to transfer the
within Right Certificate on the books of the within-named
Corporation, with full power of substitution.
Dated: __________, _____
___________________________
Signature
Signature Guaranteed:
______________________________
Signatures must be guaranteed by an "Eligible
Guarantor Institution" as defined in Rule 17Ad-15 (or any
successor rule or regulation) promulgated pursuant to the
Securities Exchange Act of 1934, as amended (this term means,
in general, banks, stock brokers, savings and loan
associations, and credit unions, in each case with membership
in an approved signature guarantee medallion program).
- --------------------------------------------------------------
The undersigned hereby certifies that (1) the Rights
evidenced by this Right Certificate are not being sold,
assigned or transferred by or on behalf of a Person who is or
was an Acquiring Person or an Affiliate or Associate thereof
(as such terms are defined in the Rights Agreement), (2) this
Right Certificate is not being sold, assigned or transferred
to or on behalf of any such Acquiring Person, Affiliate or
Associate, and (3) after due inquiry and to the best knowledge
of the undersigned, the undersigned did not acquire the Rights
evidenced by this Right Certificate from any Person who is or
was an Acquiring Person or an Affiliate or Associate thereof
(as such terms are defined in the Rights Agreement).
___________________________
Signature
- --------------------------------------------------------------
<PAGE>
Form of Reverse Side of Right Certificate -- continued
FORM OF ELECTION TO PURCHASE
(To be executed by the registered holder if
such holder desires to exercise Rights
represented by the Right Certificate)
To the Rights Agent:
The undersigned hereby irrevocably elects to
exercise ______________ Rights represented by this Right
Certificate to purchase the Preferred Shares, Common Shares or
other securities issuable upon the exercise of such Rights and
requests that certificates for such Preferred Shares, Common
Shares or other securities be issued in the name of:
Please insert social security number
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 number
or other identifying number ___________________________
______________________________________________________________
(Please print name and address)
______________________________________________________________
Dated: __________, _____
___________________________
Signature
Signature Guaranteed:
______________________________
Signatures must be guaranteed by an "Eligible
Guarantor Institution" as defined in Rule 17Ad-15 (or any
successor rule or regulation) promulgated pursuant to the
Securities Exchange Act of 1934, as amended (this term means,
in general, banks, stock brokers, savings and loan
<PAGE>
associations, and credit unions, in each case with membership
in an approved signature guarantee medallion program).
<PAGE>
Form of Reverse Side of Right Certificate -- continued
- --------------------------------------------------------------
The undersigned hereby certifies that (1) the Rights
evidenced by this Right Certificate are not being exercised by
or on behalf of a Person who is or was an Acquiring Person or
an Affiliate or Associate thereof (as such terms are defined
in the Rights Agreement), (2) this Right Certificate is not
being sold, assigned or transferred by or on behalf of any
such Acquiring Person, Affiliate or Associate, and (3) after
due inquiry and to the best knowledge of the undersigned, the
undersigned did not acquire the Rights evidenced by this Right
Certificate from any Person who is or was an Acquiring Person
or an Affiliate or Associate thereof (as such terms are
defined in the Rights Agreement).
___________________________
Signature
- --------------------------------------------------------------
Notice
The signature on the foregoing Forms of Assignment
and Election and certificates 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 Corporation 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 such terms are
defined in the Right Agreement) and such Assignment or
Election to Purchase will not be honored.
<PAGE>
Exhibit C
TELEDYNE, INC.
1901 Avenue of the Stars
Los Angeles, California 90067
SUMMARY OF RIGHTS TO PURCHASE
SERIES D PREFERRED SHARES
On January 4, 1995 (the "Effective Date"), the Board
of Directors of Teledyne, Inc. (the "Corporation") declared a
dividend distribution of one preferred share purchase right (a
"Right") for each outstanding share of Common Stock, par value
$1.00 per share (the "Common Shares"), of the Corporation.
The dividend is payable to the stockholders of record on
January 27, 1995 (the "Record Date"), and with respect to
Common Shares issued thereafter until the Distribution Date
(as defined below) and, in certain circumstances, with respect
to Common Shares issued after the Distribution Date. Except
as set forth below, each Right, when it becomes exercisable,
entitles the registered holder to purchase from the
Corporation one one-thousandth (1/1000th) of a share of Series
D Preferred Stock, $1.00 par value per share (the "Preferred
Shares"), of the Corporation at a price of $75.00 per one one-
thousandth (1/1000th) of a Preferred Share (the "Purchase
Price"), subject to adjustment. The description and terms of
the Rights are set forth in a Rights Agreement (the "Rights
Agreement") between the Corporation and Chemical Trust Company
of California, as Rights Agent (the "Rights Agent"), dated as
of January 4, 1995.
Initially, the Rights will be attached to all
certificates representing Common Shares then outstanding, and
no separate Right Certificates will be distributed. The
Rights will separate from the Common Shares upon the earliest
to occur of (i) a person or group of affiliated or associated
persons having acquired, without the prior approval of the
Corporation's Board of Directors, beneficial ownership of 15%
or more of the outstanding Common Shares (except pursuant to a
Permitted Offer, as hereinafter defined); or (ii) 10 days (or
such later date as the Board may determine) following the
commencement of, or announcement of an intention to make, a
tender offer or exchange offer the consummation of which would
result in a person or group of affiliated or associated
persons becoming an Acquiring Person (as hereinafter defined)
(the "Distribution Date"). A person or group whose
acquisitions of Common Shares cause a Distribution Date
pursuant to clause (i) above is an "Acquiring Person," with
certain exceptions as set forth in the Rights Agreement. The
<PAGE>
date that a person or group is first publicly announced to
have become such by the Corporation or such Acquiring Person
is the "Shares Acquisition Date."
The Rights Agreement provides that, until the
Distribution Date, the Rights will be transferred with and
only with the Common Shares. Until the Distribution Date (or
earlier redemption or expiration of the Rights), new Common
Share certificates issued after the Record Date upon transfer
or new issuance of Common Shares will contain a notation
incorporating the Rights Agreement by reference. Until the
Distribution Date (or earlier redemption or expiration of the
Rights), the surrender for transfer of any certificates for
Common Shares outstanding as of the Record Date, even without
such notation or a copy of this Summary of Rights being
attached thereto, will also constitute the transfer of the
Rights associated with the Common Shares represented by such
certificate. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights
("Right Certificates") will be mailed to the holders of record
of the Common Shares as of the Close of Business (as defined
in the Rights Agreement) on the Distribution Date (and to each
initial record holder of certain Common Shares issued after
the Distribution Date), and such separate Right Certificates
alone will evidence the Rights.
The Rights are not exercisable until the
Distribution Date and will expire at the close of business on
January 4, 2005, unless earlier redeemed by the Corporation as
described below.
In the event that any person becomes an Acquiring
Person (except pursuant to a tender or exchange offer which is
for all outstanding Common Shares at a price and on terms
which a majority of certain members of the Board determines to
be adequate and in the best interests of the Corporation, its
stockholders and other relevant constituencies, other than
such Acquiring Person, its affiliates and associates (a
"Permitted Offer")), each holder of a Right will thereafter
have the right (the "Flip-In Right") to receive upon exercise
the number of Common Shares (or, in certain circumstances, of
one one-thousandths (1/1000ths) of a Preferred Share or other
securities of the Corporation) having a value (immediately
prior to such triggering event) equal to two times the
exercise price of the Right. Notwithstanding the foregoing,
following the occurrence of the event described above, all
Rights that are, or (under certain circumstances specified in
the Rights Agreement) were, beneficially owned by any
Acquiring Person or any affiliate or associate thereof will be
null and void. The Board has the option, at any time after
any person becomes an Acquiring Person, to exchange all or
part of the then-exercisable Rights (excluding those that have
become void, as described in the immediately preceding
sentence) for Common Shares, at an exchange ratio determined
by dividing the then-applicable Purchase Price by the then-
current market price per Common Share as determined in
accordance with the Rights Agreement. However, this option
<PAGE>
generally terminates if any person becomes the beneficial
owner of 50% or more of the Common Shares.
In the event that, at any time following the Shares
Acquisition Date, (i) the Corporation is acquired in a merger
or other business combination transaction in which the holders
of all of the outstanding Common Shares immediately prior to
the consummation of the transaction are not the holders of all
of the surviving corporation's voting power, or (ii) more than
50% of the Corporation's assets or earning power is sold or
transferred, in either case with or to an Acquiring Person or
any affiliate or associate thereof or any other person in
which such Acquiring Person, affiliate or associate has an
interest or any person acting on behalf of or in concert with
such Acquiring Person, affiliate or associate, or if, in such
transaction, all holders of Common Shares are not treated
alike, any other person, then each holder of a Right (except
Rights which previously have been voided as set forth above)
shall thereafter have the right (the "Flip-Over Right") to
receive, upon exercise, common shares of the acquiring company
having a value equal to two times the exercise price of the
Right. The holder of a Right will continue to have the Flip-
Over Right whether or not such holder exercises or surrenders
the Flip-In Right.
The Purchase Price payable, and the number of
Preferred Shares, Common Shares or other securities issuable,
upon exercise of the Rights are subject to adjustment from
time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification
of, the Preferred Shares, (ii) upon the grant to holders of
the Preferred Shares of certain rights or warrants to
subscribe for or purchase Preferred Shares at a price, or
securities convertible into Preferred Shares with a conversion
price, less than the then current market price of the
Preferred Shares or (iii) upon the distribution to holders of
the Preferred Shares of evidences of indebtedness or assets
(excluding regular quarterly cash dividends) or of
subscription rights or warrants (other than those referred to
above).
The number of outstanding Rights and the number of
the one-thousandths (1/1000ths) of a Preferred Share issuable
upon exercise of each Right are also subject to adjustment in
the event of a stock split of the Common Shares or a stock
dividend on the Common Shares payable in Common Shares or
subdivisions, consolidations or combinations of the Common
Shares occurring, in any such case, prior to the Distribution
Date.
Preferred Shares purchasable upon exercise of the
Rights will not be redeemable. Each Preferred Share will be
entitled to a minimum preferential quarterly dividend payment
of $1.00 per share but, if greater, will be entitled to an
aggregate dividend per share of 1,000 times the dividend
declared per Common Share. In the event of liquidation, the
holders of the Preferred Shares will be entitled to a minimum
<PAGE>
preferential liquidation payment per share in an amount equal
to the greater of 1,000 times $75.00 or 1,000 times the payment
made per share of Common Stock plus an amount equal to accrued
and unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment (the "Series D
Liquidation Preference"); thereafter, and after the holders of
the Common Shares receive a liquidation payment of an amount
equal to the quotient obtained by dividing the Series D
Liquidation Preference by 1,000 (subject to certain
adjustments for stock splits, stock dividends and
recapitalizations with respect to the Common Shares), the
holders of the Preferred Shares and the holders of the Common
Shares will share the remaining assets in the ratio of 1,000
to 1 (as adjusted) for each Preferred Share and Common Share
so held, respectively. Finally, in the event of any merger,
consolidation or other transaction in which Common Shares are
exchanged, each Preferred Share will be entitled to receive
1,000 times the amount received per Common Share. These
rights are protected by customary antidilution provisions. In
the event that the amount of accrued and unpaid dividends on
the Preferred Shares is equivalent to six full quarterly
dividends or more, the holders of the Preferred Shares shall
have the right, voting as a class, to elect two directors in
addition to the directors elected by the holders of the Common
Shares until all cumulative dividends on the Preferred Shares
have been paid through the last quarterly dividend payment
date or until non-cumulative dividends have been paid
regularly for at least one year.
With certain exceptions, no adjustment in the
Purchase Price will be required until cumulative adjustments
require an adjustment of at least 1% in such Purchase Price.
No fractional Preferred Shares will be issued (other than
fractions which are one one-thousandth (1/1000th) or integral
multiples of one one-thousandth (1/1000th) of a Preferred
Share, which may, at the election of the Corporation, be
evidenced by depositary receipts) and in lieu thereof, an
adjustment in cash will be made based on the market price of
the Preferred Shares on the last trading day prior to the date
of exercise.
At any time prior to the earlier to occur of (i) a
person becoming an Acquiring Person or (ii) the expiration of
the Rights, and under certain other circumstances, the
Corporation may redeem the Rights in whole, but not in part,
at a price (payable in cash or, at the Corporation's election,
in Common Shares) of $.01 per Right (the "Redemption Price"),
which redemption shall be effective upon the action of the
Board. Additionally, following the Shares Acquisition Date,
the Corporation may redeem the then outstanding Rights in
whole, but not in part, at the Redemption Price, provided that
such redemption is in connection with a merger or other
business combination transaction or series of transactions
involving the Corporation in which all holders of Common
Shares are treated alike but not involving an Acquiring Person
or its affiliates or associates.
<PAGE>
All of the provisions of the Rights Agreement may be
amended by the Board of Directors of the Corporation prior to
the Distribution Date. After the Distribution Date, the
provisions of the Rights Agreement may be amended by the Board
in order to cure any ambiguity, defect or inconsistency, to
make changes that do not adversely affect the interests of
holders of Rights (excluding the interests of any Acquiring
Person), or, subject to certain limitations, to shorten or
lengthen any time period under the Rights Agreement.
Until a Right is exercised, the holder thereof, as
such, will have no rights as a stockholder of the Corporation,
including, without limitation, the right to vote or to receive
dividends. While the distribution of the Rights will not be
taxable to stockholders of the Corporation, stockholders may,
depending upon the circumstances, recognize taxable income
should the Rights become exercisable or upon the occurrence of
certain events thereafter.
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. A copy of the Rights
Agreement is available free of charge from the Corporation.
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.
