SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: December 12, 1997
Date of earliest event reported: December 10, 1997
THOMAS INDUSTRIES INC.
(Exact name of registrant as specified in its charter)
Delaware 1-5426 61-0505332
(State of Incorporation) (Commission File Number) (IRS Employer
Identification No.)
4360 Brownsboro Road, Suite 300, Louisville, Kentucky 40207
(Zip Code)
(502) 893-4600
(Registrant's telephone number, including area code)
Item 5. Other Events.
Pursuant to action by the Board of Directors of Thomas Industries Inc. (the
"Company") on December 10, 1997, a dividend distribution was declared of one
preferred stock purchase right (the "Rights") on each outstanding share of
common stock, par value $1.00 per share (the "Common Stock") of the Company.
The distribution will be made to shareholders of record on January 5, 1998 (the
"Record Date"). The description and terms of the Rights are set forth in a
Rights Agreement (the "Rights Agreement") between the Company and The Fifth
Third Bank, as Rights Agent (the "Rights Agent"). The Rights Agreement
contemplates the issuance of one Right for every share of Common Stock issued
between the Record Date and the Separation Date (as defined below). The Rights
Agreement also contemplates the issuance of one Right for each share of Common
Stock which is issued pursuant to any employee benefit plan or arrangement
established prior to the Separation Date. Except as set forth below, each Right
will entitle the registered holder thereof to purchase from the Company a unit
consisting of one one-hundredth of share (a "unit") of the Company's Series B
Junior Preferred Stock, par value $1.00 per share (the "Preferred Stock"), at a
purchase price of $65 per Unit (the "Purchase Price"), subject to anti-dilutive
adjustments described below.
The Rights will be represented by the Common Stock certificates and will
not be exercisable or transferable apart from the Common Stock until the earlier
to occur of (i) ten days following a public announcement that a person or group
of affiliated or associated persons (an "Acquiring Person"), has acquired, or
obtained the right to acquire, beneficial ownership of 20% or more of the
outstanding shares of Common Stock (the "Stock Acquisition Date") or (ii) ten
days following the commencement of (or announcement of an intention to make) a
tender offer or exchange offer if, upon consummation thereof, such person or
group would be the beneficial owner of 20% or more of the outstanding shares of
Common Stock (the earlier of such dates being called the "Separation Date").
Until the Separation Date (or earlier redemption or expiration of the Rights),
new Common Stock certificates issued after the Record Date upon transfer or new
issuance of Common Stock will contain a notation incorporating the Rights
Agreement by reference. As soon as practicable following the Separation Date,
separate certificates evidencing the Rights (the "Rights Certificates") will be
mailed to holders of record of the Common Stock as of the close of business on
the Separation Date. From and after the Separation Date, the separate Rights
Certificates alone will evidence the Rights. The Rights will expire at the
close of business on January 5, 2008 (the "Final Expiration Date") unless
earlier redeemed by the Company as described below.
In the event that, at any time following the Separation Date, (i) the
Company is the surviving corporation in a merger with or involving an Acquiring
Person and its Common Stock shall remain outstanding, or (ii) an Acquiring
Person becomes the beneficial owner of 20% or more of the then outstanding
shares of Common Stock, except pursuant to an offer for all outstanding Common
Stock at a price and upon terms and conditions as a majority of the Continuing
Directors determine to be in the best interest of the Company and its
shareholders, other than the Acquiring Person, or (iii) an Acquiring Person
engages in any of a number of enumerated self-dealing transactions without the
approval of a majority of the Continuing Directors, each holder of a Right will
thereafter have the right to receive, upon the exercise thereof at the then
current Purchase Price, a number of shares of Common Stock which at the time of
such transaction would have a market value of two times the current Purchase
Price. Notwithstanding the foregoing, no Right will be exercisable for Common
Stock of the Company until the Rights have become non-redeemable, as described
below. In the event that, at any time following the Separation Date, the
Company is acquired in a merger or other business combination transaction or 50%
or more of its assets or earning power is sold, each holder of a Right will
thereafter have the right to receive, upon the exercise thereof at the then
current Purchase Price, a number of shares of common stock of the acquiring
company which at the time of such transaction would have a market value of two
times such Purchase Price. If the Company would be prohibited by its
Certificate of Incorporation from issuing securities to certain holders of the
Rights upon exercise thereof, the Rights Agreement provides alternate means for
giving such holders the benefit of their Rights. Any of the events described in
this paragraph is defined as a "Triggering Event." Following the occurrence of
any of the above-mentioned Triggering Events, any Rights that are or were
beneficially owned by the Acquiring Person will be null and void.
In general, a Continuing Director is a director of the Company who is not
an Acquiring Person and who was elected to the Board prior to the time the
Acquiring Person in question became such or who was designated Continuing
Director by a majority of the Board of Directors or a majority of the then
Continuing Directors.
The Purchase Price payable, and the number of Units of Preferred Stock or
other securities or property issuable, upon exercise of the Rights, are subject
to adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Preferred
Stock, (ii) upon the grant to holders of the Preferred Stock of certain rights
or warrants to subscribe for Preferred Stock or convertible securities at less
than the current market price of the Preferred Stock, or (iii) upon the
distribution to holders of the Preferred Stock of evidences of indebtedness or
assets (excluding regular quarterly cash dividends) or of subscription rights or
warrants (other than those referred to above).
On the earlier of (i) the Stock Acquisition Date, or (ii) the Final
Expiration Date, the Company may redeem the Rights in whole, but not in part, at
a price of $.02 per Right (the "Redemption Price"). Immediately upon the action
of the Board of Directors of the Company ordering redemption of the Rights, the
Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends.
The present distribution of the Rights is not taxable to the Company or its
shareholders. Until they are exercisable, the Rights are not dilutive nor will
they affect reported earnings per share. The Company will receive no proceeds
from the issuance of the Rights as a dividend.
As long as the Rights are attached to the Common Stock, the Company will
issue one Right with each new share of Common Stock issued so that all such
shares will have attached Rights. After the Separation Date but prior to the
Expiration Date, Rights shall only be issued in connection with the issuance of
Common Stock upon the exercise of stock options granted prior to the Separation
Date or pursuant to other benefits under any employee plan or arrangement
established prior to the Separation Date.
The terms of the Rights other than the Purchase Price, the Redemption
Price, and the period during which the Rights are redeemable, may be amended by
the Board of Directors of the Company; provided, however, that the amendment
will not adversely affect the interests of holders of Rights other than an
Acquiring Person.
Item 7. Exhibits.
4.1 Rights Agreement dated as of December 10, 1997 between Thomas
Industries Inc. and Fifth Third Banc, as Rights Agent, which includes
as Exhibit A the Certificate of Designations of Preferred Stock,
Series B setting forth the terms of the Preferred Stock; as Exhibit B
the form of Rights Certificate; and as Exhibit C the form of Summary
of Rights.
99.1 Press Release, dated December 11, 1997.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
THOMAS INDUSTRIES INC.
Date: December 12, 1997 By: /s/ Phillip J. Stuecker
Name: Phillip J. Stuecker
Title: Vice President of Finance, CFO, and
Secretary
Exhibit Index
Exhibit Page
4.1 Rights Agreement dated as of December 10, 1997 -
between Thomas Industries Inc. and First Third
Banc, as Rights Agent
99.1 Press Release . . . . . . . . . . . . . . . . . . 6
THOMAS INDUSTRIES INC.
and
THE FIFTH THIRD BANK
Rights Agent
______
Rights Agreement
TABLE OF CONTENTS
Section Page
1. Certain Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Appointment of Rights Agent . . . . . . . . . . . . . . . . . . . . . . 7
3. Issue of Right Certificates . . . . . . . . . . . . . . . . . . . . . . 7
4. Form of Rights Certificates . . . . . . . . . . . . . . . . . . . . . . 8
5. Countersignature and Resignation . . . . . . . . . . . . . . . . . . . . 9
6. Transfer, Split Up, Combination and Exchange
of Rights Certificates; Mutilated, Destroyed,
Lost or Stolen Rights Certificates . . . . . . . . . . . . . . . . . . . 10
7. Exercise of Rights; Purchase Price; Expiration
Date of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
8. Cancellation and Destruction of
Rights Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . 13
9. Reservation and Availability of
Preferred Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
10. Preferred Stock Record Date . . . . . . . . . . . . . . . . . . . . . . 15
11. The Flip-In . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
12. The Flip-Over . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
13. Adjustment of Purchase Price, Number and
Kind of Shares or Number of Rights . . . . . . . . . . . . . . . . . . . 20
14. Fractional Rights and Fractional Shares . . . . . . . . . . . . . . . . 27
15. Rights of Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
16. Agreement of Rights Holders . . . . . . . . . . . . . . . . . . . . . . 28
17. Rights Certificates Holder Not
Deemed a Stockholder . . . . . . . . . . . . . . . . . . . . . . . . . . 28
18. Concerning the Rights Agent . . . . . . . . . . . . . . . . . . . . . . 29
19. Merger or Consolidation or Change
of Name of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . 29
20. Duties of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . 30
21. Change of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . 33
22. Issuance of New Rights Certificates . . . . . . . . . . . . . . . . . . 34
23. Redemption and Termination . . . . . . . . . . . . . . . . . . . . . . . 34
24. Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
25. Notice of Certain Events . . . . . . . . . . . . . . . . . . . . . . . . 36
26. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
27. Supplements and Amendments . . . . . . . . . . . . . . . . . . . . . . . 38
28. Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
29. Benefits of this Agreement . . . . . . . . . . . . . . . . . . . . . . . 39
30. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
31. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
32. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
33. Descriptive Headings . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Exhibit A Certificate of Designation, Preferences and Rights
Exhibit B Rights Certificate
Exhibit C Summary of Rights
RIGHTS AGREEMENT
Rights Agreement, dated as of January 5, 1998 (the "Agreement"),
between THOMAS INDUSTRIES INC., a Delaware corporation (the "Company"), and THE
FIFTH THIRD BANK, an Ohio corporation (the "Rights Agent").
WHEREAS, on December 23, 1987, the Board of Directors of the Company
adopted a Rights Agreement which was amended on October 18, 1990, and will
terminate at the close of business on January 4, 1998; and
WHEREAS, on December 10, 1997, the Board of Directors of the Company
authorized and declared a dividend distribution of one Right (as hereinafter
defined) for each outstanding share of common stock, par value $1.00 per share,
of the Company (the "Common Stock") outstanding on January 4, 1998 (the "Record
Date"), and contemplates the issuance of one Right for each share of Common
Stock of the Company issued between the Record Date and the Separation Date (as
hereinafter defined) and one Right for each share of Common Stock of the Company
issued upon exercise of stock options granted prior to the Separation Date or
under any employee plan or arrangement established prior to the Separation Date,
each Right representing the right to purchase one one-hundredth of a share of
Series B Junior Preferred Stock of the Company having the rights, powers and
preferences set forth in the form of Certificate of Designation, Preferences and
Rights attached hereto as Exhibit A upon the terms and subject to the conditions
hereinafter set, forth (the "Rights");
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
SECTION 1. CERTAIN DEFINITIONS. For purposes of this Agreement, the
following terms have the meanings indicated.
(a) "ACQUIRING PERSON" shall mean any Person (as such term is
hereinafter defined) who or which, together with all Affiliates (as hereinafter
defined) and Associates (as hereinafter defined) of such Person, shall be the
Beneficial Owner (as hereinafter defined) of 20% or more of the shares of Common
Stock then outstanding and shall include all Affiliates and Associates of such
Person, but shall not include the Company, any Subsidiary of the Company, any
employee benefit plan of the Company or any Subsidiary of the Company or any
entity holding shares of Common Stock organized, appointed or established by the
Company for or pursuant to the terms of any such plan. Notwithstanding the
foregoing, if a Person who would otherwise be an "Acquiring Person," as defined
pursuant to the foregoing provisions of this paragraph,
(i) notifies the Company in writing within five business days
thereafter (the "Notification Period") that it has inadvertently
become the Beneficial Owner of 20% or more of the shares of Common
Stock then outstanding, and
(ii) within three business days after the end of the Notification
Period divests as promptly as practical a sufficient number of shares
of Common Stock so as to reduce its holdings to less than 20%, and
brings proof thereof in writing to the Company no more than six (6)
business day after the end of the Notification Period, then that
Person shall not be deemed to be and "Acquiring Person" for any
purposes of this Agreement.
(b) "AFFILIATE" shall mean, with respect to a specified Person, a
Person that directly, or indirectly through one or more intermediaries, controls
or is controlled by, or is under common control with, the Person specified.
(c) "ASSOCIATE" shall mean, with respect to a specified Person,
(i) any corporation or organization (other than the Company or a
Subsidiary of the Company) of which such Person is an officer or
partner or is, directly or indirectly, the beneficial owner of 10% or
more of any class of equity security as defined in Rule 3a-11 of the
General Rules and Regulations under the Exchange Act,
(ii) any trust or other estate in which such Person has a
substantial beneficial interest or as to which such Person serves as
trustee or in a similar fiduciary capacity, and
(iii) any relative or spouse of such Person, or any relative of
such spouse, who has the same home as such Person, or is an officer or
director of any corporation controlling or controlled by such Person.
(d) "BENEFICIAL OWNERSHIP" shall be determined pursuant to Rule 13d-3
of the General Rules and Regulations under the Securities Exchange Act of 1934
(or any successor rule or statutory provision) or, if Rule 13d-3 shall be
rescinded and there shall be no successor rule or statutory provision thereto,
pursuant to Rule 13d-3 as in effect on the date hereof; provided, however, that
a Person shall, in any event, also be deemed to be the "Beneficial owner" of any
securities:
(i) which such Person or any Affiliate or Associate thereof
beneficially owns, directly or indirectly;
(ii) which such Person or any Affiliate or Associate thereof,
directly or indirectly, has the right to acquire (whether such right
is exercisable immediately or only after the passage of time) pursuant
to any agreement, arrangement or understanding (whether or not in
writing) or upon the exercise of conversion rights, exchange rights,
rights, warrants or options, or otherwise; provided, however, that a
Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially own," (A) securities tendered pursuant to a tender or
exchange offer made by such Person or any Affiliate or Associate
thereof until the tendered securities are accepted for purchase or
exchange, or (B) securities issuable upon exercise of Rights;
(iii) which such Person or any Affiliate or Associate thereof,
directly or indirectly, has sole or shared voting or investment power
with respect thereto pursuant to any agreement, arrangement or
understanding (whether or not in writing); provided, however, that a
Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially own," any security under this subparagraph (iii) as a
result of an agreement, arrangement or understanding to vote such
security if such agreement, arrangement or understanding (A) arises
solely from a revocable proxy given in response to a public proxy or
consent solicitation made pursuant to, and in accordance with, the
applicable provisions of the General Rules and Regulations under the
Exchange Act, and (B) is not also then reportable by such Person on
Schedule 13D under the Exchange Act; or
(iv) which are beneficially owned, directly or indirectly, by any
other Person or any Affiliate or Associate thereof with which such
Person or any Affiliate or Associate thereof has any agreement,
arrangement or understanding (whether or not in writing), for the
purpose of acquiring, holding, voting, (except pursuant to a revocable
proxy as described in subparagraph (iii) of this paragraph (d)) or
disposing of any voting securities of the Company.
Nothing in this Section 1(e) shall cause a Person engaged in business as an
underwriter to be the "Beneficial Owner" of, or to "beneficially own," any
securities acquired through such Person's participation in good faith in a firm
commitment underwriting until the expiration of 40 days after the date of the
acquisition.
(e) "BUSINESS DAY" shall mean any day other than a Saturday, Sunday
or a day on which banking institutions in the State of Ohio are authorized or
obligated by law or executive order to close.
(f) "CLOSE OF BUSINESS" on any given date shall mean 5:00 P.M.,
Cincinnati, Ohio time, on such date; provided, however, that if such date is not
a Business Day it shall mean 5:00 P.M., Cincinnati, Ohio time, on the next
succeeding Business Day.
(g) "CLOSING PRICE" of any security on any given day shall be the
last sale price, regular way, of such security or, in case no sale takes place
on such day, the average of the closing bid and asked prices, regular way, on
the principal trading market on which the security is then traded.
(h) "COMMON STOCK" shall mean the common stock, par value $1.00 per
share, of the Company, and "Common stock" when used with reference to any Person
other than the Company shall mean the capital stock with the greatest voting
power, or the equity securities or other equity interest having power to control
or direct the management, of such Person.
(i) "CONTINUING DIRECTOR" shall mean any director of the Company who
is not an Acquiring Person or a representative or nominee of an Acquiring
Person, and
(i) who was elected by the stockholders or appointed by the Board
of Directors of the Company prior to the date as of which the
Acquiring Person became an Acquiring Person, or
(ii) who was designated (before his initial election or
appointment as a director) as a Continuing Director by a majority of
the Whole Board which was in office prior to their being an Acquiring
Person.
(j) "CURRENT MARKET PRICE" of any security on any given day shall be
deemed to be the average of the daily Closing Prices per share or other trading
unit of such security for 45 consecutive Trading Days (as hereinafter defined)
immediately preceding such date; provided, however, that with respect to shares
of capital stock, in the event that the current market price per share of the
capital stock is determined during a period following the announcement of
(i) a dividend or distribution on the capital stock payable in
shares of such capital stock or securities convertible into shares of
such capital stock (other than the Rights), or
(ii) any subdivision, combination or reclassification of the
capital stock, and prior to the expiration of the requisite 45 Trading
Day period, as set forth above, after the ex-dividend date for the
dividend or distribution, or the record date for the subdivision,
combination or reclassification, then and in each case, the "Current
Market Price" shall be properly adjusted to take into account ex-
dividend trading; and provided further that if the security is not
publicly held or not so listed or traded, Current Market Price per
share or other trading unit shall mean the fair value per share or
other trading unit as determined in good faith by the Board of
Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent and shall be conclusive for all
purposes.
(k) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended and in effect on the date of this Agreement, and all references to any
rule or regulation of the General Rules and Regulations under the Exchange Act
shall be, except as otherwise specifically-provided herein, to such rule or
regulation as was in effect on the date of this Agreement.
(l) "EXCHANGE DATE" shall mean the date at which the Rights are
exchanged as provided in Section 24 of this Agreement.
(m) "EXPIRATION DATE" shall mean the Close of Business on January 5,
2008.
(n) "FLIP-IN EVENT" shall mean the event described in the first
clause of Section 11(a) hereof.
(o) "FLIP-OVER EVENT" shall mean any of the events described in
Section 12(a) hereof.
(p) "PERSON" shall mean any individual, firm, corporation,
partnership or other entity and shall include any "group" as that term is used
in Rule 13d-5(b) under the Exchange Act (or any successor rule or statutory
provision).
(q) "PREFERRED STOCK" shall mean shares of Series B Junior Preferred
Stock, par value $1.00 per share, of the Company.
(r) "SEPARATION DATE" shall mean the earlier of
(i) the Close of Business on the tenth day after the Stock
Acquisition Date (as hereinafter defined) or
(ii) the Close of Business on the tenth day (but in no event
later than the time when any Person becomes an Acquiring Person) after
the date of the commencement of, or first public announcement of the
intent to commence, a tender or exchange offer by any Person (other
than the Company, any Subsidiary of the Company, any employee benefit
plan of the Company or any Subsidiary of the Company or any entity
holding shares of Common Stock organized, appointed or established by
the Company for or pursuant to the terms of any such plan) if upon
consummation thereof, that Person would be an Acquiring Person
(including any such date which is after the date of this Agreement and
prior to the issuance of the Rights).
(s) "STOCK ACQUISITION DATE" shall mean the first date of public
announcement by the Company or an Acquiring Person that an Acquiring Person has
become such.
(t) "SUBSIDIARY" shall mean, with reference to any Person, any
corporation of which a majority of any class of equity security is Beneficially
Owned, directly or indirectly, by such Person.
(u) "TRADING DAY" with respect to any security 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.
(v) "TRIGGERING EVENT" shall mean any Flip-In Event or any Flip-Over
Event.
(w) "WHOLE BOARD" shall mean the total number of directors which the
Company would have if there were no vacancies.
Any determination required by the definitions contained in this
Section 1 shall be made by the Board of Directors of the Company in its good
faith judgment, which determination shall be final and binding on the Rights
Agent.
SECTION 2. APPOINTMENT OF RIGHTS AGENT. The Company hereby appoints
the Rights Agent to act as agent for the Company and the holders of the Rights
(who, in accordance with Section 3 hereof, shall prior to the Separation Date
also be the holders of the Common Stock) in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such Co-Rights Agents as it may deem
necessary or desirable.
SECTION 3. ISSUE OF RIGHTS CERTIFICATES.
(a) Until the Separation Date,
(i) the Rights will be evidenced by the certificates for the
Common Stock registered in the names of the holders of the Common
Stock (which certificates for Common Stock shall be deemed also to be
certificates for Rights) and not by separate certificates, and
(ii) the Rights will be transferable only in connection with the
transfer of the underlying shares of Common Stock (including a
transfer to the Company).
(b) As soon as practicable after the Separation Date, the Company
will prepare and execute and the Rights Agent will countersign, and the Rights
Agent will, if requested by the Company, send by first-class, insured, postage
prepaid mail, to each record holder of the Common Stock as of the Close of
Business on the Separation Date, at the address of the holder shown on the
records of the Company, a Rights certificate, in substantially the form of
Exhibit B hereto (the "Rights Certificates"), evidencing one Right for each
share of Common Stock so held. After the distribution of the Rights
Certificates, the Rights will be evidenced solely by Rights Certificates.
(c) As promptly as practicable following the Record Date, the Company
will send a copy of a Summary of Rights, in substantially the form attached
hereto as Exhibit C (the "Summary of Rights"), by first-class, postage prepaid
mail to each record holder of the Common Stock as of the Close of Business on
the Record Date, at the address of the holder shown on the records of the
Company.
(d) Certificates for the Common Stock issued after the Record Date
but prior the earlier of the Separation Date or the Expiration Date (as
hereinafter defined), 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 the Rights Agreement between Thomas Industries
Inc. (the "Company") and The Fifth Third Bank, dated as of January 4, 1998 (the
"Rights Agreement"), the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal offices of the
Company. Upon the occurrence of certain events, as set forth in the Rights
Agreement, the Rights will be evidenced by separate certificates and will no
longer be evidenced by this certificate. The Company will mail to the holder of
this certificate a copy of the Rights Agreement without charge promptly after
receipt of a written request therefor, Under certain circumstances, Rights
beneficially owned by Acquiring Persons (as defined in the Rights Agreement)
become null and void and the holder of the Rights (including any subsequent
holder) shall not have any right to exercise the Rights.
(e) After the Separation Date but prior to the Expiration Date,
Rights shall be issued in connection with the issuance of Common Stock upon the
exercise of stock options granted prior to the Separation Date or pursuant to
other benefits under employee plans or arrangements established prior to the
Separation Date; provided, however, that if, pursuant to the terms of any option
or other benefit plan, the number of shares issuable thereunder is adjusted
after the Separation Date, the number of Rights issuable upon issuance of the
shares shall be equal only to the number of shares which would have been
issuable prior to the adjustment.
SECTION 4. FORM OF RIGHTS CERTIFICATES. (a) The Rights Certificates
and the form of election to purchase shares (and the form of assignment) shall
be in substantially the form attached hereto as Exhibit B, and may have such
marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law 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. Subject to the provisions of this Agreement,
the Rights Certificates, whenever distributed, shall be dated as of the Record
Date and on their face shall entitle the holders thereof to purchase the number
of shares of Preferred Stock set forth therein at the Purchase Price set forth
herein, subject to adjustment as provided herein.
(b) Any Rights Certificate issued pursuant to Section 3(a) hereof
that represents Rights beneficially owned by an Acquiring Person or that
represents any Rights owned on or after the Separation Date by any Person who
subsequently becomes an Acquiring Person and any Rights Certificate issued at
any time upon the transfer of any Rights to an Acquiring Person or to any
nominee of an Acquiring Person and any Rights Certificate issued pursuant to
Section 6 or Section 13 of this Agreement upon transfer, exchange, replacement
or adjustment of any other Rights Certificate referred to in this sentence, may
contain the following legend:
The Rights represented by this Rights Certificate are or were
beneficially owned by a Person who was or became an Acquiring Person
or an Associate or Affiliate of an Acquiring Person (as such terms are
defined in the Rights Agreement). This Rights Certificate and the
Rights represented hereby will become void in the circumstances
specified in Section 7(e) of the Rights Agreement.
SECTION 5. COUNTERSIGNATURE AND REGISTRATION. (a) The Rights
Certificates shall be executed on behalf of the Company by its Chairman of the
Board, its President or any Vice President, either manually or by facsimile
signature and shall have affixed thereto the Company's seal or a facsimile
thereof which shall be attested by the Secretary or an Assistant Secretary of
the Company, either manually or by facsimile signature. The Rights Certificates
shall be manually countersigned by the Rights Agent and shall not be valid for
any purpose unless so countersigned. In case any officer of the Company who
shall have signed any of the Rights Certificates shall cease to be an officer of
the Company before countersignature by the Rights Agent and issuance and
delivery by the Company, the Rights Certificates, nevertheless, may be
countersigned by the Rights Agent, and issued and delivered by the Company with
the same force and effect as though the person who signed the Rights
Certificates had not ceased to be an officer of the Company and any Rights
Certificates may be signed on behalf of the Company by any person who, at the
actual date, of the execution of the Rights Certificate, shall be a proper
officer of the Company to such Rights Certificate, although at the date of the
execution of this Rights Agreement any such person was not such an officer.
(b) Following the Separation Date, the Rights Agent will keep or
cause to be kept, at one of its offices in Cincinnati, Ohio, books for
registration and transfer of the Rights Certificates issued hereunder. Such
books shall show the names and addresses of the respective holders of the Rights
Certificates, the number of Rights evidenced on its face by each of the Rights
Certificates and the date of each of the Rights Certificates.
SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF RIGHTS
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHTS CERTIFICATES. (a)
Subject to the provisions of Section 14 hereof, at any time after the Close of
Business on the Separation Date, and at or prior to the Close of Business on the
Expiration Date, any Rights Certificate or Certificates may be transferred,
split up, combined or exchanged for another Rights Certificate or certificates,
entitling the registered holder to Purchase a like number of shares of Preferred
Stock as the Rights Certificate or 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 Rights
Certificate or Certificates shall make such request in writing delivered to the
Rights Agent, and shall surrender the Rights Certificate or Certificates to be
transferred, split up, combined or exchanged at the principal office of the
Rights Agent designated for such purpose. Thereupon, the Rights Agent shall
countersign and deliver to the Person entitled hereto a Rights Certificate or
Rights Certificates, as the case may be, as so requested. The Company may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer, split up, combination or
exchange of Rights Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence,
reasonably satisfactory to them of the loss, theft, destruction or mutilation of
a Rights Certificate, and, in case of loss, theft or destruction, of indemnity
or security reasonably satisfactory to them, and reimbursement to the Company
and the Rights Agent of all reasonable expenses incidental thereto, and upon
surrender to the Rights Agent and cancellation of the Rights Certificate if
mutilated, the Company will execute and deliver a new Rights Certificate of like
tenor to the Rights Agent for countersignature and delivery to the registered
owner in lieu of the Rights Certificate so lost, stolen, destroyed or mutilated.
SECTION 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF
RIGHTS. (a) Until the Separation Date, no Right may be exercised. Subject to
Section 7(e) hereof, the registered holder of any Rights Certificate may
exercise the Rights evidenced thereby in whole or in part at any time after the
Separation Date. Upon surrender of the Rights Certificate, together with the
form of election to purchase on the reverse-side thereof including the
certificate contained therein duly executed, to the Rights Agent at the
principal corporate trust office of the Rights Agent, together with payment of
the Purchase Price prior to the earliest of
(i) the Closing of Business on the Expiration Date, subject to
extension as provided in Section 12(c) hereof (the "Final Expiration
Date"),
(ii) the time at which the Rights are redeemed as provided in
Section 23 hereof, or
(iii) the time at which the Rights are exchanged as provided in
Section 24 hereof (the earliest of such times being herein referred to
as the "Expiration Date").
(b) The Purchase Price for each one one-hundredth of a share of
Preferred Stock pursuant to the exercise of a Right shall initially be $65, and
shall be subject to adjustment from time to time as provided in Section 13
hereof and shall be payable in lawful money of the United States of America in
accordance with Paragraph (c) below.
(c) Upon receipt of a Rights Certificate representing exercisable
Rights, with the form of election to purchase including the certificate
contained therein duly executed, accompanied by payment of the Purchase Price
for the shares to be purchased and an amount equal to any applicable transfer
tax in cash, or by certified check or bank draft payable to the order of the
Company, the Rights Agent shall thereupon promptly
(i)(A) requisition from any transfer agent of the shares of
Preferred Stock certificates for the number of shares of Preferred
Stock to be purchased and the Company hereby irrevocably authorizes
its transfer agent to comply with all such requests, or (B)
requisition from the depositary agent depositary receipts representing
such number of one one-hundredths of a share of Preferred Stock as are
to be purchased in which case certificates for the shares of Preferred
Stock represented by such receipts shall be deposited by the transfer
agent with the depositary agent) and the Company will direct the
depositary agent to comply with such request,
(ii) requisition from the Company the amount of cash, if any, to
be paid in lieu of fractional shares in accordance with Section 14,
(iii) after receipt of the certificates or depositary receipts,
cause the same to be delivered to or upon the order of the registered
holder of the Rights Certificate, registered in such name or names as
may be designated by the holder, and
(iv) after receipt deliver the cash, if any, to or under the
order of the registered holder of such Rights Certificate.
(d) In case the registered holder Certificate of any Rights
Certificate shall exercise less than all the Rights evidenced thereby, a new
Rights Certificate evidencing the unexercised Rights shall be issued by the
Rights Agent and delivered to the registered holder of such Rights Certificate
or to his duly authorized assigns to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the contrary, upon
the occurrence of a Triggering Event, any unexercised Rights that are or were at
any time on or after the earlier to occur of
(i) the Separation Date or
(ii) the Stock Acquisition Date beneficially owned by an
Acquiring Person or owned by any Person who subsequently becomes an
Acquiring Person shall immediately become permanently null and void
without any further action, and any holder of such Rights shall
thereupon have no right to exercise such Rights under any provision of
this Agreement or otherwise.
The Company shall use all reasonable efforts to ensure that the provisions of
this Section 7(e) and Section 4(b) of this Agreement are complied with, but
shall have no liability to any holder of Rights Certificates or other Person as
a result of its failure to make any determinations with respect to an Acquiring
Person or its Affiliates or transferees hereunder.
(f) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder of any Rights Certificate upon the
occurrence of any purported exercise thereof unless the 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 Rights
Certificate surrendered for exercise and
(ii) provided such additional evidence of the identity of the
Beneficial Owner (or former or proposed Beneficial Owner) or
Affiliates thereof as the Company shall reasonably request.
(g) Notwithstanding any other provision of this Agreement, in the
event that compliance with Article Seventh of the Company's Restated Certificate
of Incorporation would prohibit the Company from issuing shares or similar units
to the holder of any Rights upon exercise thereof, then, upon the holder's
presentation of the Rights Certificates therefor to the Rights Agent, so long as
the Rights shall not have become null and void pursuant to Section 7(e) hereof,
the Company, at its option,
(i) may call a meeting of stockholders to obtain the
authorization required by Article Seventh or
(ii) to the extent required by its Restated Certificate of
Incorporation, in lieu of issuing any shares of Common Stock or
similar units to the holder of those Rights, the Company at its option
may
(A) cause the Rights Agent to deliver the holder's Rights
Certificates to the Company and the Company shall sell, or cause
to be sold, the Rights represented thereby for the account of the
holder and promptly remit the net proceeds thereof to the holder,
or
(B) provide fair value to the holder (as determined by the
Board of Directors in good faith, which determination shall be
conclusive for purposes of this Agreement).
SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHTS CERTIFICATES. All
Rights Certificates surrendered for the purpose of exercise, transfer, split-up,
combination or exchange shall, if surrendered to the Company or any of its
agents, be delivered to the Rights Agent for cancellation or in cancelled form,
or if surrendered to the Rights Agent, shall be cancelled by it, and no Rights
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Rights Agreement. The Company shall deliver to
the Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Rights Certificates purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall
deliver all cancelled Rights Certificates to the Company, or shall, at the
written request of the Company, destroy the cancelled Rights Certificates, and
in such case shall deliver a certificate of destruction to the Company.
SECTION 9. RESERVATION AND AVAILABILITY OF PREFERRED AND COMMON STOCK.
(a) The Company covenants and agrees that it will cause to be reserved and kept
available out of its authorized and unissued shares of Preferred Stock or any
authorized and issued shares of Preferred Stock held in its treasury (and
following the occurrence of a Triggering Event, out of its authorized and
unissued shares of Common Stock and/or other securities or out of its authorized
and issued shares of Common Stock and/or other securities held in its treasury),
the number of shares of Preferred Stock that will be sufficient to permit the
exercise in full of all outstanding Rights.
(b) The Company further covenants and agrees that so long as the
shares of Preferred Stock (and, following the occurrence of a Triggering Event,
shares of Common Stock and/or other securities) issuable upon the exercise of
the Rights may be listed on any national securities exchange, the Company shall
use its best efforts to cause, from and after such time as the Rights become
exercisable, all shares reserved for issuance to be listed on such exchange upon
official notice of issuance.
(c) The Company shall use its best efforts to
(i) file, as soon as practicable following the earlier of the
Separation Date or as soon as is required by law, a registration
statement under the Securities Act of 1933 (the "Act"), with respect
to the Preferred Stock purchasable upon exercise of the Rights on an
appropriate form,
(ii) cause the registration statement to become effective as soon
as practical after the filing, and
(iii) cause the registration statement to remain effective (with
a prospectus at all times meeting the requirements of the Act) until
the Expiration Date.
The Company will also take all action necessary to ensure compliance
with the securities laws of the various states in connection with the
exercisability of the Rights. The Company may temporarily suspend, for a period
of time not to exceed ninety (90) days after the date set forth in clause (i) of
the first sentence of this Section 9(c), the exercisability of the Rights in
order to prepare and file such registration statements. Upon any suspension,
the Company shall issue a public announcement stating that the exercisability of
the Rights has been temporarily suspended, as well as a public announcement at
such time as the suspension is no longer in effect. Notwithstanding any
provision of this Agreement to the contrary, the Rights shall not be exercisable
in any jurisdiction unless the requisite qualification in that jurisdiction
shall have been obtained.
(d) The Company covenants and agrees that it will take all action to
ensure that all shares of Preferred Stock delivered upon exercise of Rights
shall, at the time of delivery of the certificates for such shares (subject to
payment of the Purchase Price), be duly and validly authorized and issued and
fully paid and nonassessable shares.
(e) The Company further covenants and agrees that it will pay when
due and payable any and all federal and state transfer taxes and charges which
may be payable in respect of the issuance or delivery of the Rights Certificates
and of any certificates for shares of Preferred Stock upon the exercise of
Rights. The Company shall not, however, be required to pay any transfer tax
which may be payable in respect of any transfer or delivery of Rights
Certificates to a person other than, or the issuance or delivery of the shares
of Preferred Stock in respect of a name other than that of the registered holder
of the Rights Certificates evidencing Rights surrendered for exercise or to
issue or deliver any certificates for shares of Preferred Stock in a name other
than that of, the registered holder upon the exercise of any Rights until such
tax shall have been paid tax being payable by the holder of the Rights
Certificate at the time of surrender) or until it has been established to the
Company's satisfaction that no tax is due.
SECTION 10. PREFERRED STOCK RECORD DATE. Each person in whose name
any certificate for shares of Preferred Stock is issued upon the exercise of
Rights shall for all purposes be deemed to have become the holder of record of
the shares of Preferred Stock represented thereby on, and the certificate shall
be dated, the date upon which the Rights Certificate evidencing the Rights was
duly surrendered and payment of the Purchase Price (and all applicable transfer
taxes) was made; provided, however, that if the date of surrender and payment is
a date upon which the Preferred Stock transfer books of the Company are closed,
such person shall be deemed to have become the record holder of the shares on,
and the certificate shall be dated, the next succeeding Business Day on which
the Preferred Stock transfer books of the Company are open.
SECTION 11. THE FLIP-IN. (a) In the event any Person shall become an
Acquiring Person, then subject to the provisions of Section 24 of this Agreement
proper provision shall be made so that each holder of a Right, except as
provided below and in Sections 7(e) hereof, shall thereafter have a right to
receive, upon exercise of the Right at the then current Purchase Price in
accordance with the terms of this Agreement, in lieu of shares of Preferred
Stock, such number of shares of Common Stock of the Company as shall equal the
result obtained by (x) multiplying the then current Purchase Price by the then
number of one one-hundredths of a share of Preferred Stock for which a Right was
exercisable on the date on which the first of the events listed above in this
subparagraph (a) occurs and dividing that product by (y) 50% of the Current
Market Price per share of the Common Stock on the date of the first occurrence
of a Flip-In Event (such number of shares being herein referred to as the
"Adjustment Shares").
(b) In the event that there shall not be sufficient issued but not
outstanding and authorized but unissued shares of Common Stock to permit the
exercise in full of the Rights in accordance with the foregoing subparagraph
(a), the Company shall take all action to authorize additional shares of Common
Stock for issuance upon exercise of the Rights; provided, however, if the
Company is unable to cause the authorization of a sufficient number of
additional shares of Common Stock, then, in the event the Rights become so
exercisable, the Company, with respect to each Rights and to the extent
necessary and permitted by applicable law and any agreements or instruments in
effect on the date hereof to which it is a party shall, upon the exercise of
such Rights,
(i) pay an amount in cash equal to the excess of (A) the product
of (1) the number of Adjustment Shares, multiplied by (2) the Current
Market Price of the Common Stock (such product being herein referred
to as the Current Value), over (B) the Purchase Price, in lieu of
issuing shares of Common Stock and requiring payment therefor, or
(ii) issue cash, debt or equity securities, or a combination
thereof, having a value equal to the Current Value with the Current
Value for this purpose being determined by a recognized investment
banking firm selected by the Board of Directors of the Company.
To the extent that the Company determines that some action need be
taken pursuant to clauses (i) or (ii) of the proviso of this Section 11(b), a
majority of the Continuing Directors may suspend the exercisability of the
Rights for a period of up to 45 days following the date on which the first of
the events listed in Section 11(ii) of this Agreement shall have occurred, in
order to decide the appropriate form of distribution to be made pursuant to the
above proviso and to determine the value made pursuant to the above proviso and
to determine the value thereof. In the event of any suspension, the Company
shall issue a public announcement stating that the exercisability of the Rights
has been temporarily suspended, as well as a public announcement at the time the
suspension is no longer in effect.
SECTION 12. THE FLIP-OVER.
(a) In the event that, following the Separation Date, directly or
indirectly,
(w) the Company shall consolidate with, or merge with and
into, any other Person,
(x) any Person shall consolidate with the Company, or merge
with and into the Company and the Company shall be the continuing
or surviving corporation of such merger and, in connection with
such merger, all or part of the shares of Common Stock shall be
changed into or exchanged for stock or other securities of any
other Person or cash or any other property,
(y) the Company shall effect a share exchange in which all
or part of the Common Stock of the company shall be changed into
(including, without limitation, any conversion into or exchange
for) securities of any other Person, cash or any other property;
or
(z) the Company shall sell, lease, mortgage or otherwise
transfer (or one or more of its Subsidiaries shall sell, mortgage
or otherwise transfer), in one or more transactions, assets or
earning power aggregating more than 50% of the assets or earning
power of the Company and its Subsidiaries (taken as a whole) to
any other Person or Persons, then, and in each such case,
(i) each holder of a Right, except as provided in Section 7(e)
hereof, shall thereafter have the right to receive, upon the exercise
thereof at the then current Purchase Price in accordance with the
terms of this Agreement, such number of shares of freely tradeable
common stock of the Principal Party (as hereinafter defined), free and
clear of any lien, encumbrance or other adverse claim, as shall be
equal to the result obtained by (1) multiplying the then current
Purchase Price by the number of one one-hundredths of a share of
Preferred Stock for which a Right was exercisable on the date on which
the first events listed in Section 11(a) occurs (or the number of one
one-hundredths of a share of Preferred Stock for which a Right was
exercisable immediately prior to the occurrence of the Flip-In Event
if a Flip-In Event has previously occurred) and dividing that product
by (2) 50% of the Current Market Price per share of the common stock
of such Principal Party on the date of consummation of the Flip-Over
Event;
(ii) such Principal Party shall thereafter be liable for, and
shall assume, by virtue of the Flip-Over Event, all the obligations
and duties of the Company pursuant to this Agreement;
(iii) the term "Company" shall thereafter be deemed to refer to
such Principal Party, it being specifically intended that the
provisions of Section 13 hereof shall apply to such Principal Party;
(iv) such Principal Party shall take such steps (including, but
not limited to, the reservation of a sufficient number of shares of
its common stock) in connection with the consummation as may be
necessary to assure that the provisions hereof shall thereafter be
applicable, as nearly as reasonably may be, in relation to its shares
of common stock thereafter deliverable upon the exercise of the
Rights; and
(v) the provisions of Section 11 hereof shall be of no effect
following the first occurrence of any Flip-Over Event.
"PRINCIPAL PARTY" shall mean:
(i) in the case of any transaction described in (w) or (y) of
the first sentence of this Section 12, the Person that is the issuer
of any securities into which shares of Common Stock of the Company are
converted in such merger, consolidation or other business combination,
and if no securities are so issued, the Person that is the other party
to the merger, consolidation or other business combination; and
(ii) in the case of any transaction described in (w) of the first
sentence in this Section 12, the Person that is the Person receiving
the greatest portion of the assets or earning power transferred
pursuant to such transaction or transactions; provided, however, that
in any case, (1) if the common stock of such Person is not then and
has not been continuously over the preceding 12-month period
registered under the Exchange Act, as then in effect, and such Person
is a direct or indirect Subsidiary of another Person the common stock
of which is and has been so registered, "Principal Party" shall refer
to such other Person; and (2) in case such Person is a Subsidiary,
directly or indirectly, of more than one Person, the common stocks of
two or more of which are and have been so registered, "Principal
Party" shall refer to whichever of the Persons is the issuer of the
common stock having the greatest aggregate market value.
(c) The Company shall not Consummate any Flip-Over Event unless prior
thereto the Company and each Principal Party and each other Person who may
become a Principal Party shall have executed and delivered to the Rights Agent a
supplemental agreement providing for the terms set forth in paragraphs (a) and
(b) of this Section 12 and further providing that, as soon as practicable after
the date of any Flip-Over Event, the Principal Party will:
(i) prepare and file at its own expense a registration statement
under the Act with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form, will
use its best efforts to cause such registration statement to become
effective as soon as practicable after such filing and will use its
best efforts to cause such registration statement to remain effective
(with a prospectus at all times meeting the requirements of the Act)
until the Expiration Date; and
(ii) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which
comply in all respects with the requirements for registration on Form
10 under the Exchange Act.
The Principal Party shall temporarily suspend, for a period of time
not to exceed 90 days following the occurrence of a Flip-Over Event, the
exercisability of the Rights in order to prepare and file the registration
statement referred to in clause (i) above, and the Final Expiration Date shall
be extended by the number of days of such suspension. The provisions of this
Section 12 shall similarly apply to successive Flip-Over Events. In the event
that a Flip-Over Event shall occur at any time after the occurrence of a Flip-In
Event, the Rights which have not theretofore been exercised shall thereafter
become exercisable in the manner described in Section 12(a).
SECTION 13. 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 13 or as otherwise provided in this
Agreement.
(a) In the event the Company shall at any time after the date of this
Agreement (A) declare a dividend on the Preferred Stock payable in shares of
Preferred Stock, (B) subdivide the outstanding Preferred Stock, (C) combine the
outstanding Preferred Stock Into a smaller number of shares, or (D) issue any
shares of its capital stock in a reclassification of the Preferred Stock
(including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing or surviving corporation), except
as otherwise provided in this Section 13(a), the Purchase Price in effect at the
time of the record date for the dividend or of the effective date of the
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 Rights exercised after such time shall be entitled to
receive the aggregate number and kind of shares of capital stock which, if the
Rights had been exercised immediately prior to such date and at a time when the
Preferred Stock transfer books of the Company were open, he would have owned
upon such exercise and been entitled to receive by virtue of such dividend,
subdivision, combination or reclassification. If an event occurs which would
require an adjustment under both Section 11(a) hereof and this Section 13(a),
the adjustment provided for in this Section 13(a) shall be in addition to, and
shall be made prior to any adjustment required pursuant to Section 11(a).
(b) If the Company shall fix a record date for the issuance of
rights, options or warrants to all holders of Preferred Stock entitling them to
subscribe for or purchase (for a period expiring within 45 calendar days after
such record date) Preferred Stock (or shares having the same rights, privileges
and preferences as the shares of Preferred Stock ("equivalent preferred stock"))
or securities convertible into Preferred Stock or equivalent preferred stock at
a price per one one-hundredth of a share of Preferred Stock or per share of
equivalent preferred stock (or having a conversion price per share, if a
security convertible into Preferred Stock or equivalent preferred stock) less
than the Current Market Price per one one-hundredth of a share of Preferred
Stock 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 one one-hundredths of shares of Preferred Stock outstanding on such
record date, plus the number of one one-hundredths of shares of Preferred Stock
which the aggregate offering price of the total number of one one-hundredths of
shares of Preferred Stock and/or equivalent preferred stock so to be offered
(and/or the aggregate initial conversion price of the convertible securities so
to be offered) would purchase at such current market price and the denominator
of which shall be the number of one one-hundredths of shares of Preferred Stock
outstanding on such record date, plus the number of additional one one-
hundredths of shares of Preferred Stock and/or equivalent preferred stock to be
offered for subscription or purchase (or into which the convertible securities
so to be offered are initially convertible). If the subscription price may be
paid in a consideration part or all of which shall be in a form other than cash,
the value of the consideration shall be as determined in good faith by the Board
of Directors of the Company, whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the Rights Agent.
Shares of Preferred Stock owned by or held for the account of the Company 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 or warrants are not so issued, the Purchase Price
shall be adjusted to be the Purchase Price which would then be in effect if such
record date had not been fixed.
(c) In case the Company shall fix a record date for a distribution to
all holders of Preferred Stock (including any distribution made in connection
with a consolidation or merger in which the Company is the continuing
corporation) of evidences of indebtedness, cash (other than a regular quarterly
cash dividend out of the earnings or retained earnings of the Company assets
(other than a dividend payable in Preferred Stock, but including any dividend
payable in stock other than Preferred Stock) or subscription rights or warrants
(excluding those referred to in Section 13(b)), the Purchase Price to be in
effect after such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a fraction, the
numerator of which shall be the Current Market Price per one one-hundredth of a
share of the Preferred Stock on such record date, less the fair market value (as
determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rifts Agent) of
the portion of the cash assets or evidences of indebtedness so to be distributed
or of such subscription rights or warrants applicable to one one-hundredth of a
share of Preferred Stock and the denominator of which shall be such current
market price per one one-hundredth of a share of the Preferred Stock. 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 which would be in effect if such
record date had not been fixed.
(d) 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 which by reason of this Section 13(d) are not required to
be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 13 shall be made to the nearest
cent or to the nearest ten-thousandth of a share of Common Stock or other share
of one-millionth of a share of Preferred Stock, as the case may be.
Notwithstanding the first sentence of this Section 13(d), any adjustment
required by this Section 13 shall be made no later than the earlier of
(i) three years from the date of the transaction which mandates
such adjustment or
(ii) the Expiration Date.
(e) If as a result of an adjustment made pursuant to Section 11(a),
the holder of any Rights thereafter exercised shall become entitled to receive
any shares of capital stock of the Company, other than Preferred Stock,
thereafter the number of such other shares so receivable upon exercise of any
Rights shall be subject to adjustment from time to time in a manner and on terms
as nearly equivalent as practicable to the provisions with respect to the shares
contained in Section 13(a) through (c), inclusive, and the provisions of Section
7, 9, 10, 12 and 14 hereof with respect to the Preferred Stock shall apply on
like terms to any other shares.
(f) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of shares of Preferred
Stock purchasable from time to time hereunder upon exercise of the Rights, all
subject to further adjustment as provided herein.
(g) Unless the Company shall have exercised its election as provided
in Section 13(h), upon each adjustment of the Purchase Price as a result of the
calculations made in Sections 13(b) and (c), each Rights outstanding immediately
prior to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number, of one one-hundredths of
a share of Preferred Stock (calculated to the nearest one-millionth) obtained by
(i) multiplying (x) the number of one one-hundredths of a share
covered by a Right immediately prior to this adjustment by (y) the
Purchase Price in effect immediately prior to such adjustment of the
Purchase Price and
(ii) dividing the product so obtained by the Purchase Price in
effect immediately after such adjustment of the Purchase Price.
(h) The Company may elect on or after the date of any adjustment of
the Purchase Price to adjust the number of Rights, in substitution for any
adjustment in the number of shares of Preferred Stock purchasable upon the
exercise of a Right. Each of the Rights outstanding after the adjustment in the
number of Rights shall be exercisable for the number of one one-hundredths of a
share of Preferred Stock for which a Right was exercisable immediately prior to
such adjustment. Each Right held of record prior to such adjustment of the
number of Rights shall become that number of Rights (calculated to the nearest
one-millionth) obtained by dividing the Purchase Price in effect immediately
prior to adjustment of the Purchase Price by the Purchase Price in effect
immediately after adjustment of the Purchase Price. The Company shall make a
public announcement of its election to adjust the number of Rights, indicating
the record date for the adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which the Purchase
Price is adjusted or any day thereafter, but, if the Rights Certificates have
been issued, shall be at least 10 days later than the date of the public
announcement. If Rights Certificates have been issued, upon each adjustment of
the number of Rights pursuant to this Section 13(h), the Company shall, as
promptly as practicable, cause to be distributed to holders of record of Rights
Certificates on such record date Rights Certificates evidencing, subject to
Section 14 hereof, the additional Rights to which such holders shall be entitled
as a result of such adjustment, or, at the option of the Company, shall cause to
be distributed to such holders of record in substitution and replacement for the
Rights Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Rights Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment. Rights Certificates so to be distributed shall be issued, executed
and countersigned in the manner provided for herein (and may bear, at the option
of the Company, the adjusted Purchase Price) and shall be registered in the
names of the holders of record of Rights Certificates on the record date
specified in the public announcement.
(i) Irrespective of any adjustment or change in the Purchase Price or
the number of one one-hundredths of a share of Preferred Stock issuable upon the
exercise of the Rights, the Rights Certificates theretofore and thereafter
issued may continue to express the Purchase Price per share and the number of
shares which were expressed in the initial Rights Certificates issued hereunder.
(j) Before taking any action that would cause an adjustment reducing
the Purchase Price below the par value of the shares of Preferred Stock issuable
upon exercise of the Rights, the Company shall take any corporate action which
may, in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue fully paid and nonassessable shares of Preferred Stock
at such adjusted Purchase Price.
(k) In any case in which this Section 13 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuance to the holder of any Rights exercised after such record date
the shares of Preferred Stock and other capital stock or securities of the
Company, if any, issuable upon such exercise over and above the shares of
Preferred Stock and other capital stock or securities of the Company, if any,
issuable upon such exercise on the basis of the Purchase Price in effect prior
to such adjustment; provided, however, that the Company shall deliver to such
holder a due bill or other appropriate instrument evidencing such holder's right
to receive such additional shares upon the occurrence of the event requiring
such adjustment.
(l) Anything in this Section 13 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this Section 13, as and to
the extent that in its sole discretion the Company shall determine to be
advisable in order that any
(i) consolidation or subdivision of the Preferred Stock,
(ii) issuance wholly for cash of any shares of Preferred Stock at
less than the Current Market Price,
(iii) issuance wholly for cash of shares of Preferred Stock or
securities which by their terms are convertible into or exchangeable
for shares of Preferred Stock,
(iv) stock dividends, or
(v) issuance of rights, options or warrants referred to in this
Section 13, hereafter made by the Company to holders of its Preferred
Stock shall, if practicable, not be taxable to such stockholders.
(m) The Company covenants and agrees that it shall not at any time
after the Separation Date,
(i) consolidate with,
(ii) merge with or into, or
(iii) sell or transfer to, in one or more transactions, assets or
earning power aggregating more than 50% of the assets or earning power
of the Company and its Subsidiaries taken as a whole, any other Person
if at the time of or immediately after such consolidation, merger or
sale there are any rights, warrants or other instruments or securities
outstanding or agreements in effect which would substantially diminish
or otherwise eliminate the benefits intended to be afforded by the
Rights.
(n) The Company covenants and agrees that, after the Stock
Acquisition Date, it will not, except as permitted by Section 23 or Section 27
hereof, take any action the purpose or effect of which is to diminish
substantially or otherwise eliminate the benefits intended to be afforded by the
Rights, unless such action is approved by a majority of the Continuing
Directors.
(o) Anything in this Agreement to the contrary notwithstanding, in
the event that the Company shall at any time prior to the Separation Date
(i) declare a dividend or distribution on the outstanding shares
of Common Stock payable in shares of Common Stock,
(ii) subdivide the outstanding shares of Common Stock, or
(iii) combine the outstanding shares of Common Stock into a
smaller number of shares,
the number of Rights associated with each share of Common Stock then
outstanding, or issued or delivered thereafter but prior to the Separation Date,
shall be proportionately adjusted so that the number of Rights thereafter
associated with each share of Common Stock following any such event shall equal
the result obtained by multiplying the number of Rights associated with each
share of Common Stock immediately prior to such event by a fraction, (1) the
numerator of which shall be the total number of shares of Common Stock
outstanding immediately prior to the occurrence of the event and (2) the
denominator of which shall be the total number of shares of Common Stock
outstanding immediately following the occurrence of such event.
(p) Whenever an adjustment is made as Provided in Sections 11, 12 and
13 hereof, the Company shall (a) promptly prepare a certificate setting forth
such adjustment and a brief statement of the facts accounting for such
adjustment, (b) promptly file with the Rights Agent and with each transfer agent
for the Preferred Stock and the Common Stock a copy of such Certificate and (c)
mail a brief summary thereof to each holder of a Rights Certificate in
accordance with Section 26 hereof. The Rights Agent shall be fully protected in
relying on any such certificate and on any adjustment therein contained.
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES. (a) The Company
shall not be required to issue fractions of Rights or to distribute Rights
Certificates which evidence fractional Rights. In lieu of such fractional
Rights, there shall be paid to the registered holders of the Rights 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 Price of a whole
Right as of the date on which such fractional Rights would have been otherwise
issuable.
(b) The Company shall not be required to issue fractions of shares of
Preferred Stock (other than fractions which are integral multiples of one one-
hundredth of a share of Preferred Stock) upon exercise of the Rights or to
distribute certificates which evidence fractional shares of Preferred Stock
(other than fractions which are integral multiples of one one-hundredth of a
share of Preferred Stock). In lieu of fractional shares of Preferred Stock that
are not integral multiples of one one-hundredth of a share of Preferred Stock,
the Company may pay to the registered holders of Rights Certificates at the time
such Rights are exercised as herein provided an amount in cash refusal to the
same fraction of the Current Market Price of one one-hundredth of a share of
Preferred Stock as of the date of such exercise.
(c) The holder of a Right by the acceptance of the Rights expressly
waives his right to receive any fractional Rights or any fractional shares upon
exercise of a Right.
SECTION 15. RIGHTS OF ACTION. All rights of action in respect of
this Agreement are vested in the respective registered holders of the Rights
Certificates and only such holders (and, prior to the Separation Date, the
registered holders of the Common Stock and only such holders); and any
registered holder of any Rights Certificate (or, prior to the Separation Date,
of the Common Stock) without the consent of the Rights Agent or of the holder of
any other Rights Certificate (or, prior to the Separation Date, of the Common
Stock) may, in his own behalf and for his own benefit, enforce, and may
institute and maintain any suit, action or proceeding against the Company to
enforce, or otherwise act in respect of, his right to exercise the Rights
evidenced by such Rights Certificate in the manner provided in such Rights
Certificate and in this Agreement. without limiting the foregoing or any
remedies available to the holders of Rights, it is specifically acknowledged
that the holders of Rights would not have an adequate remedy at law for any
breach of this Agreement and shall be entitled to specific Performance of the
obligations hereunder and injunctive relief against actual or threatened
violations of the obligations hereunder of any Person subject to this Agreement.
SECTION 16. AGREEMENT OF RIGHTS HOLDERS. Every holder of a Right by
accepting the Right consents and agrees with the Company and the Rights Agent
and with every other holder of a Right that:
(a) prior to the Separation Date, the Rights will be transferable
only in connection with the transfer of Common Stock;
(b) after the Separation Date, the Rights Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the principal corporate trust office of the Rights Agent, duly endorsed or
accompanied by a proper instrument of transfer;
(c) the Company and the Rights Agent may deem and treat the person in
whose name a Rights Certificate (or, prior to the Separation Date, the
associated Common Stock certificate) is registered as the absolute owner thereof
and of the Rights evidenced thereby (notwithstanding any notations of ownership
or writing on the Rights Certificates or the associated Common Stock certificate
made by anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent shall be affected by
any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any holder
of a Right or other Person as 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, the Company must use its best
efforts to have any such order, decree or ruling lifted or otherwise overturned.
SECTION 17. RIGHTS CERTIFICATE HOLDER NOT DEEMED A STOCKHOLDER.
Except as otherwise expressly provided in this Agreement, no holder, as such, of
any Rights Certificate shall be entitled to vote, receive dividends or be deemed
for any purpose the holder of the shares of Preferred Stock or any other
securities of the Company which may at any time be issuable on the exercise of
the Rights represented thereby, nor shall anything contained herein or in any
Rights Certificate be construed to confer upon the holder of any Rights
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders, or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by such Rights Certificate shall have been
exercised in accordance with the provisions hereof.
SECTION 18. CONCERNING THE RIGHTS AGENT. The Company agrees to pay
to the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and disbursements and other disbursements incurred in
the administration and execution of this Agreement and the exercise and
performance of its duties hereunder. The Company also agrees to indemnify the
Rights Agent for, and to hold it harmless against, any loss, liability, or
expense, incurred without gross negligence, bad faith or willful misconduct on
the part of the Rights Agent, for anything done or omitted by the Rights Agent
in connection with the acceptance and administration of this Agreement,
including the costs and expenses of defending against any claim of liability in
the premises. The indemnification provided for hereunder shall survive the
expiration of the Rights and the termination of this Agreement.
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 Rights Certificate or
certificate for Common Stock or for other securities of the Company, instrument
of assignment or transfer, power of attorney, endorsement, affidavit, letter,
notice, direction, consent, certificate, statement, or other paper or document
believed by it to be genuine and to be signed, executed and, where necessary,
verified or acknowledged, by the proper Person or Persons, or otherwise upon the
advice of counsel as set forth in Section 20 hereof.
SECTION 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS
AGENT. Any corporation into which the Rights Agent or any successor Rights
Agent may be merged or with which it may be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any corporation succeeding to the
corporate trust business of the Rights Agent or any successor Rights Agent,
shall be the successor to the Rights Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation would be eligible for appointment
as a successor Rights Agent under the provisions of Section 21 hereof. In case
at the time such successor Rights Agent shall succeed to the agency created by
this Agreement, any of the Rights Certificates shall have been countersigned but
not delivered, any such Successor Rights Agent may adopt the countersignature of
predecessor Rights Agent and deliver such Rights Certificates so countersigned;
and in case at that time any of the Rights Certificates shall not have been
countersigned, any successor Rights Agent may countersign such Rights
Certificates either in the name of the predecessor or in the name of the
successor Rights Agent; and in all such cases such Rights Certificates shall
have the full force provided in the Rights Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall be changed and
at such time any of the Rights. Certificates shall have been countersigned but
not delivered, the Rights Agent may adopt the countersignature under its prior
name and deliver Rights Certificates so countersigned; and in case at that time
any of the Rights certificates shall not have been countersigned, the Rights
Agent may countersign such Rights Certificates either in its prior name or in
its changed name; and in all such cases such Rights Certificates shall have the
full force provided in the Rights Certificates and in this Agreement.
SECTION 20. DUTIES OF RIGHTS AGENT. The Rights Agent undertakes the
duties and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the holders of Rights Certificates,
by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may be legal
counsel for the Company), and the opinion of such counsel shall be full and
complete authorization and protection to the Rights Agent as to any action taken
or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement
the Rights Agent shall deem it necessary or desirable that any fact or matter
(including, without limitation, the identity of any Acquiring Person) be proved
or established by the Company prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof be herein
specifically prescribed) may be deemed to be conclusively proved and established
by a certificate signed by the Chairman of the Board, the President, any Vice
President, the Treasurer, any Assistant Treasurer, the secretary or any
Assistant Secretary of the Company and delivered to the Rights Agent; and such
certificate shall be full authorization to the Rights Agent, for any action
taken or suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its own gross
negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any of
the statements of facts or recitals contained in this Agreement or in the Rights
Certificates or be required to verify the same (except as to its
countersignature on such Rights Certificates), but all such statements and
recitals are and shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in respect
of the validity of this Agreement or the execution and delivery hereof (except
the due execution hereof by the Rights Agent) or in respect of the validity or
execution of any Rights Certificate (except its countersignature thereof); nor
shall it be responsible for any breach by the Company 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(e) hereof or any other provision) or
adjustment required under the provisions of Sections 11 or 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 Rights Certificates
after actual notice of any such adjustment); nor shall it by any act hereunder
be deemed to make any representation or warranty as to the authorization or
reservation of any shares of Common Stock or Preferred Stock to be issued
pursuant to this Agreement or any Rights Certificate or as to whether any shares
of Common Stock or Preferred Stock will, when so issued, be validly authorized
and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may reasonably be required
by the Rights Agent for the carrying out or performing by the Rights Agent of
the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from the
Chairman of the Board, the President, any Vice President, the Secretary, any
Assistant Secretary, the Treasurer or any Assistant Treasurer of the Company,
and to apply to such officers for advice or instructions in connection with its
duties, and it shall not be liable for any action taken or suffered to be taken
by it in good faith in accordance with instructions of any such officer or for
any delay in acting while waiting for those instructions. Any application by
the Rights Agent for written instructions from the Company may, at the option of
the Rights Agent, set forth in writing any action proposed to be taken or
omitted by the Rights Agent under this Rights Agreement and the date on and/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 application on or
after the date specified in such application (which date shall not be less than
five Business Days after the date any officer of the Company actually receives
such application, unless prior to taking any action (or effective date in the
case of an omission), the Rights Agent shall have received written instructions
in response to such application specifying the action to be taken or omitted.
(h) 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 Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though it were not Rights Agent
under this Agreement. Nothing herein shall preclude the Rights Agent from
acting in any other capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself or by or
through its attorneys or agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such act, default,
neglect or misconduct provided reasonable care was exercised in the selection
and continued employment thereof.
(j) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if
there shall be reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not reasonably
assured to it.
(k) The Rights Agent shall not be required to take notice or be
deemed to have notice of any fact event or determination under the Rights
Agreement unless and until the Rights Agent shall be specifically notified in
writing by the Company of such fact, event or determination.
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 30 days, notice in writing mailed to the Company, and to each
transfer agent of the Common Stock and Preferred Stock by registered or
certified mail, and to the holders of the Rights Certificates by first-class
mail. The Company may remove the Rights Agent or any successor Rights Agent
upon 30 days' notice in writing, mailed to the Rights Agent or successor Rights
Agent, as the case may be, and to each transfer agent of the Common Stock and
Preferred Stock, by registered or certified mail, and to the holders of the
Rights Certificates by first-class mail. If the Rights Agent shall resign or be
removed or shall otherwise become incapable of acting, the Company shall appoint
a successor to the Rights Agent. If the Company shall fail to make such
appointment within a period of 30 days after giving notice of such removal or
after it has been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the holder of a Rights Certificate
(who shall, with such notice, submit his Rights Certificate for inspection by
the Company), then the registered holder of any Rights Certificate may apply to
any court of competent jurisdiction for the appointment of a new Rights Agent.
Any successor Rights Agent, whether appointed by the Company or by such a court,
shall be a corporation organized and doing business under the laws of the United
States or of the States of Ohio, Kentucky, or New York (or of any other state of
the United States so long as such corporation is authorized to do business as a
banking institution in the States of Ohio, Kentucky, or New York), in good
standing, having a principal office in the state of Kentucky, which is
authorized under such laws to exercise corporate trust powers and is subject to
supervision or examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined Capital and surplus of at
least $100,000,000. After appointment, the successor Rights Agent shall be
vested with the same powers, rights, duties and responsibilities as if it had
been originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Not later
than the effective date of any such appointment the company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer agent of
the Common Stock and the Preferred Stock, and mail a notice thereof in writing
to the registered holders of the Rights Certificates. Failure to give any
notice provided for in this Section 21, however, or any defect therein, shall
not affect the legality or validity of the resignation or removal of the Rights
Agent or the appointment of the successor Rights Agent, as the case may be.
SECTION 22. ISSUANCE OF NEW RIGHTS CERTIFICATES. Notwithstanding any
of the provisions of this Agreement or of the Rights to the contrary, the
Company may, at its option, issue new Rights Certificates evidencing Rights in
such form as may be approved by its Board of Directors to reflect any adjustment
or change in the Purchase Price per share and the number or kind or class of
shares or other securities or property purchasable under the Rights Certificates
made in accordance with the provisions of this Agreement.
SECTION 23. REDEMPTION AND TERMINATION. (a) The Board of Directors of
the Company may, at its option, at any time prior to 5:00 P.M., Cincinnati, Ohio
time, on the earlier of
(i) the Stock Acquisition Date, or
(ii) the Final Expiration Date,
redeem all but not less than all the then outstanding Rights at a redemption
price of $.02 per Right, 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").
Notwithstanding anything in this Agreement to the contrary, no Rights may be
exercised at any time that the Rights are subject to redemption in accordance
with the terms of this Agreement.
(b) Immediately with the action of the Board of Directors of the
Company 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.
Within 10 days after the action of the Board of Directors ordering the
redemption of the Rights, the Company shall give notice of such redemption to
the Rights Agent and the holders of the then outstanding Rights by mailing such
notice to all holders at their last addresses as they appear upon the registry
books of the Rights Agent or prior to the Separation Date, on the registry books
of the Transfer Agent for the Common Stock. Any notice which was mailed in the
manner herein provided shall be deemed given, whether or not the holder receives
the notice. Each notice of redemption will state the method by which the
payment of the Redemption Price will be made.
SECTION 24. EXCHANGE. (a) The Board of Directors of the Company, at
its option, may 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 pursuant to the provisions of Section
7(e) hereof) for Common Stock at an exchange ratio of one share of Common Stock
per Right, appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such exchange ratio being
hereinafter referred to as the "Exchange Ratio"). Notwithstanding the
foregoing, the Board of Directors shall not be empowered to effect such exchange
at any time after any Person (other than the Company, any Subsidiary of the
Company, any employee benefit plan or compensation arrangement of the Company or
any such Subsidiary, or any entity holding securities of the Company to the
extent organized, appointed or established by the Company or any such Subsidiary
for or pursuant to the terms of any such employee benefit plan or compensation
arrangement), together with all Affiliates and Associates of such Person,
becomes the Beneficial Owner of 50% or more of the shares of Common Stock then
outstanding.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the exchange of any Rights pursuant to subsection (a) of this
Section 24 and without any further action and without any notice, the right to
exercise such Rights shall terminate and the only right thereafter of a holder
of such Rights shall be to receive that number of shares of Common Stock equal
to the number of such Rights held by such holder multiplied by the Exchange
Ratio. The Company shall promptly give public notice on any such exchange;
provided, however, that the failure to give, or any defect in, such notice shall
not affect the validity of such exchange. The Company promptly shall mail a
notice of any exchange to all of the holders of 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 notice of exchange will state the method by
which the exchange will be effected and, in the event of any partial exchange,
the number of Rights which will be exchanged. Any partial exchange shall be
effected pro rata based on the number of Rights (other than Rights which have
become void pursuant to the provisions of Section 7(e) hereof) held by each
holder of Rights.
(c) In any exchange pursuant to this Section 24, the Company, at its
option, may substitute Preferred Stock (or equivalent preferred stock) for
Common Stock exchangeable for Rights at the initial rate of one one-hundredth of
a share of Preferred Stock (or equivalent preferred stock) for each share of
Common Stock, as appropriately adjusted to reflect adjustments in the dividend,
liquidation and voting rights of the Preferred Stock (or equivalent preferred
stock) pursuant to the terms thereof, so that the fraction of a share of
Preferred Stock (or equivalent preferred stock) delivered in lieu of each share
of Common Stock shall have the same dividend, liquidation and voting rights as
one share of Common Stock.
(d) In the event that there shall not be sufficient shares of Common
Stock or Preferred Stock (or equivalent preferred stock) issued but not
outstanding or authorized but unissued to permit any exchange of Rights as
contemplated in accordance with this Section 24, the Company shall take all
action as may be necessary to authorize additional shares of Common Stock or
Preferred Stock (or equivalent preferred stock) for issuance upon exchange of
the Rights.
(e) The Company shall not be required to issue fractions of Common
Stock or to distribute certificates which evidence fractional shares of Common
Stock. In lieu of fractional shares of Common Stock, the Company shall pay to
the registered holders of the Right Certificates with regard to which such
fractional shares of Common Stock would otherwise be issuable an amount in cash
equal to the same fraction of the Closing Price of a whole share of Common Stock
for the Trading Day immediately prior to the date of exchange pursuant to this
Section 24.
SECTION 25. NOTICE OF CERTAIN EVENTS. (a) In case the Company shall
propose
(i) to pay any dividend payable in stock of any class to the
holders of Preferred Stock or to make any other distribution to the
holders of Preferred Stock (other than a regular quarterly cash
dividend at a rate not in excess of $2.50 per share), or
(ii) to offer to the holders of Preferred Stock rights or
warrants to subscribe for or to purchase any additional shares of
Preferred Stock or shares of stock of any class or any other
securities, rights or options, or
(iii) to effect any reclassification of its Preferred Stock
(other than a reclassification involving only the subdivision of
outstanding shares of Preferred Stock), or
(iv) to effect any Flip-Over Event, or
(v) to effect the liquidation, dissolution or winding up of the
Company,
then, in each case, the Company shall give to each holder of a Rights
Certificate, in accordance with Section 26 hereof, a notice of such proposed
action, which shall specify the record date for the purposes of such stock
dividend, distribution of rights or warrants, or the date on which such
reclassification, Flip-Over Event, liquidation, dissolution, or winding up is to
take place and the date of participation therein by the holders of the shares of
Preferred Stock, if any date is to be fixed, and such notice shall be so given
in the case of any action covered by clause (i) or (ii) above at least 20 days
prior to the record date for determining holders of the shares of Preferred
Stock for purposes of such action, and in the case of any such other action, at
least 20 days prior to the date of the taking of such proposed action or the
date of participation therein by the holders of the shares of Preferred Stock
whichever shall be the earlier.
(b) Upon the occurrence of a Flip-In Event or a Flip-over Event, the
Company or Principal Party, as the case may be, shall as soon as practicable
thereafter give to each holder of a Rights Certificate, to the extent feasible
and in accordance with Section 26 hereof, a notice of the occurrence of such
event and the consequences thereof to holders of Rights under Sections 11(a) or
12(a) hereof, as the case may be.
SECTION 26. NOTICES. Notices or demands authorized by this Agreement
to be given or made by the Rights Agent or by the holder of any Rights
Certificate to or on the Company shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed (until another address is filed in
writing with the Rights Agent) as follows:
Thomas Industries Inc.
4360 Brownsboro Road
P.O. Box 35120
Louisville, Kentucky 40232
Attention: Secretary
Subject to the provisions of Section 21, any notice or demand authorized by this
Agreement to be given or made by the Company or by the holder of any Rights
Certificate to or on the Rights Agent shall be sufficiently given or made if
delivered by first-class mail, postage prepaid, addressed (until another address
is filed in writing with the Company) as follows:
The Fifth Third Bank
Number 1090 D2
38 Fountain Square Plaza
Cincinnati, Ohio 45202
Notices or demands authorized by this Agreement to be given or made by
the Company or the Rights Agent to the holder of any Rights Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company. The Company shall deliver a copy of any notice or demand
it delivers to the holder of an Rights Certificate to the Rights Agent and the
Rights Agent shall deliver a copy of any notice or demand it delivers to the
holder of any Rights Certificate to the Company.
SECTION 27. SUPPLEMENTS AND AMENDMENTS. The Company and the Rights
Agent may from time to time supplement or amend this Agreement without the
approval of any holders of Rights Certificates in order to cure any ambiguity,
to correct or supplement any provision contained herein which may be defective
or inconsistent with any other provisions herein or to change or supplement the
provisions hereunder in any manner which the Company may deem necessary or
desirable and which shall not adversely affect the interests of the holders of
Rights Certificates other than an Acquiring Person; provided, however, that this
Agreement may not be supplemented or amended in any way unless the Company's
Board of Directors consists of a majority of Continuing Directors at the time of
such amendment or supplement and provided further that no amendment or
supplement may be made if the effect would be to extend or shorten the
redemption period after the Separation Date or change the Purchase Price or the
Redemption Price.
SECTION 28. SUCCESSORS. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
SECTION 29. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement
shall be construed to give to any Person other than the Company, the Rights
Agent and the registered holders of the Rights Certificates (and, prior to the
Separation Date, the Common Stock) any legal or equitable right, remedy or claim
under this Agreement; but this Agreement shall be for the sole and exclusive
benefit of the Company, the Rights Agent and the registered holders of the
Rights Certificates (and, prior to the Separation Date, the Common Stock).
SECTION 30. 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.
SECTION 31. GOVERNING LAW. This Agreement, each Right and each Rights
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of Delaware and for all purposed shall be governed by and
construed in accordance with the laws of such State applicable to contracts made
and to be performed entirely within such State.
SECTION 32. COUNTERPARTS. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.
SECTION 33. 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
THOMAS INDUSTRIES INC.
Attest:
By:_________________________ By:_________________________
Name: Phillip J. Stuecker Name: Timothy C. Brown
Title: Vice President of Finance, Title: Chief Executive Officer
Chief Financial Officer
and Secretary
THE FIFTH THIRD BANK
Attest:
By:_________________________ By:_________________________
Name:_______________________ Name:_______________________
Title:______________________ Title:______________________
EXHIBIT A
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS OF
SERIES B JUNIOR PREFERRED STOCK OF
THOMAS INDUSTRIES, INC.
PURSUANT TO SECTION 151 OF THE GENERAL CORPORATION LAW
OF THE STATE OF DELAWARE
We, Timothy C. Brown, Chairman of the Board, and Phillip J. Stuecker,
Secretary, of THOMAS INDUSTRIES INC., 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 by
Article Fourth the Certificate of Incorporation of the Corporation, and in
accordance with the provisions of Section 151 of the General Corporation Law of
the State of Delaware, its Board of Directors on December 10, 1997, adopted the
following resolution creating a series of its Preferred Stock, par value $1.00
per share, designated as Series B Junior Preferred Stock:
RESOLVED, that pursuant to the authority vested in the Board of Directors
of this Corporation, in accordance with the provisions of its Articles of
Incorporation, as amended, a series of Preferred Stock, Series B (the "Preferred
Stock"), be and it hereby is, created, and that the designations and amount
thereof and the relative rights, preferences and limitations of the shares of
such series and the qualifications, limitations or restrictions thereof are as
follows:
Section 1. Designation and Amount. The shares of the series shall be
designated as "Series B Junior Preferred Stock" (the "Series Preferred Stock")
and the number of shares constituting the series shall be 300,000.
Section 2. Dividends and Distributions.
(A) The holders of shares of Series Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds legally
available for the purpose, quarterly dividends payable in cash on the fifteenth
day of March, June, September and December in each year (each such date being
referred to herein as a "Quarterly Divided Payment Date"), commencing on the
first Quarterly Dividend Payment Date after the first issuance of a share or
fraction of a share of Series Preferred Stock, in an amount per share (rounded
to the nearest cent) equal to the greater of (a) $2.50, or (b) subject to the
provision for adjustment hereinafter set forth, 100 times the aggregate per
share amount of all cash dividends, and 100 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other distributions other than a
dividend payable in shares of Common Stock or a subdivision of the outstanding
shares of Common Stock (by reclassification or otherwise), declared on the
Common Stock of the Corporation (the "Common Stock") since the immediately
preceding Quarterly Dividend Payment Date, since the first issuance of any share
or fraction of a share of Series Preferred Stock. In the event the Corporation
shall at any time declare or pay any dividend on Common Stock payable in shares
of Common Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then in each of those cases the multiplier set forth
in clause (b) of the preceding sentence shall be adjusted by multiplying such
multiplier 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.
The Corporation shall declare a dividend or distribution on the Series
Preferred Stock as provided in this paragraph (A) 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 Dividend
Payment Date, a dividend of $2.50 per share on the Series Preferred Stock shall
nevertheless be payable on such subsequent Quarterly Dividend Payment Date.
Dividends shall begin to accrue and be cumulative on outstanding shares of
Series Preferred Stock from the Quarterly Dividend Payment Date next preceding
the date of issue of such shares of Series 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 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 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 Preferred Stock entitled to
received payment of a dividend or distribution declared thereon, which record
date shall be no more than 45 days prior to the date fixed for the payment
thereof.
Section 3. Voting Rights. The holders of shares of Series Preferred
Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth, each
share of Series Preferred Stock shall entitled the holder thereof to 100 votes
on all matters submitted to a vote of the stockholders of the Corporation. In
the event the Corporation shall at any time declare or pay any dividend on
Common Stock payable in shares of Common Stock; or effect a subdivision or
combination of the outstanding shares of Common Stock (by reclassification or
otherwise) into a greater or lesser number o f shares of Common Stock, then in
each such case the number of votes per share to which holders of shares of
Series B Preferred Stock were entitled immediately prior to such event shall be
adjusted by multiplying such 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.
(B) Except as otherwise provided herein or by law, the holders of shares
of Series 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.
(C)(i) If at any time dividends on any Series Preferred Stock shall be
in arrears in an amount equal to six quarterly dividends thereon, the occurrence
of such contingency shall mark the beginning of a period (herein called a
"default period") which shall extend until such time when all accrued and unpaid
dividends for all previous quarterly dividend periods and for the current
quarterly dividend period on all shares of Series Preferred Stock then
outstanding shall have been declared and paid or set apart for payment. During
each default period, the holders of Preferred Stock, voting as a class,
irrespective of series, shall have the right to elect two Directors, which
Directors shall be in addition to the then otherwise authorized number of
Directors.
(ii) During any default period, such voting right of the holders
of Series Preferred Stock may be exercised initially at a special
meeting called pursuant to subparagraph (iii) of this Section 3(C) or
at any annual meeting of stockholders, provided that such voting right
shall not be exercised unless the holders of 25% in number of shares
of Preferred Stock outstanding shall be present in person or by proxy.
The absence of a quorum of the holders of Common Stock shall not
affect the exercise by the holders of Preferred Stock of such voting
right. After the holders of Preferred Stock shall have exercised
their right to elect Directors in any default period and during the
continuance of such period, the number of Directors shall not be
increased or decreased except by vote of the holders of Preferred
Stock as herein provided.
(iii) Unless the holders of Preferred Stock shall, during an
existing default period, have previously exercised their right to
elect Directors, the Board of Directors may order, or any stockholder
or stockholders owning in the aggregate not less than 10% of the total
number of shares of Preferred Stock outstanding, irrespective of
series, may request, the calling of a special meeting of the holders
of Preferred Stock, which meeting shall thereupon be called by the
Chairman of the Board, the President, a Vice-President or the
Secretary of the Corporation. Notice of such meeting and of any
annual meeting at which holders of Preferred Stock are entitled to
vote pursuant to this paragraph (C)(iii) shall be given to each holder
of record of Preferred Stock by mailing a copy of such notice to him
at his last address as the same appears on the books of the
Corporation. Such meeting shall be called for a time not earlier than
20 days and not later than 60 days after such order or request or in
default of the calling of such meeting within sixty days after such
order or request, such meeting may be called on similar notice by any
stockholder or stockholders owning in the aggregate not less than 10%
of the total number of shares of Preferred Stock outstanding.
Notwithstanding the provisions of this paragraph (C)(iii), no such
special meeting shall be called during the period within 60 days
immediately preceding the date fixed for the next annual meeting of
the stockholders.
(iv) In any default period the holders of Common Stock, and other
classes of stock of the Corporation, if applicable, shall continue to
be entitled to elect the whole number of Directors then otherwise
authorized.
(v) The Directors elected by the holders of Preferred Stock
shall continue in office until the next annual meeting of stockholders
and until their successors shall have been elected by such holders or
until the expiration of the default period. Any vacancy in the Board
of Directors may be filled by vote of a majority of the remaining
Directors theretofore elected b the holders of the class of stock
which elected the Director whose office shall have become vacant.
Reference in this paragraph (C) to Directors elected by the holders of
a particular class of stock shall include Directors elected by such
Directors to fill vacancies as provided in the foregoing sentence.
(vi) Immediately upon the expiration of a default period, (x) the
right of the holders of Preferred Stock as a class to elect Directors
shall cease, (y) the term of any Directors elected by the holders of
Preferred Stock as a class shall terminate, and (z) the number of
Directors shall be such number as may then be authorized by the Board
of Directors.
(D) Except as set forth herein, holders of Series Preferred Stock shall
have no special voting rights and their consent shall not be required (except to
the extent they are entitled to vote with holders of Common Stock as set forth
herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series 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 Preferred Stock outstanding shall have been
paid in full, the Corporation shall not:
(i) declare or pay dividends on, make any other distributions
on, or redeemed or purchase or otherwise acquire for consideration any
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series Preferred Stock:
(ii) declare or pay dividends on or make any other distributions
or any shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series Preferred
Stock, except dividends paid ratably on the Series Preferred Stock and
all such parity stock on which dividends are payable or in arrears in
proportion to the total amounts to which the holders of all such
shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the
Series Preferred Stock, provided that the Corporation may at any time
redeem, purchase or otherwise acquire shares of any such parity stock
in exchange for shares of any stock of the Corporation ranking junior
(either as to dividends or upon dissolution, liquidation or winding
up) to the Series Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any shares
of Series Preferred Stock, or any shares of stock ranking on a parity
with the Series Preferred Stock, except in accordance with a purchase
offer made in writing or by publication (as determined by the Board of
Directors) to all holders of such shares upon such terms as the Board
of Directors, after consideration of the respective annual dividend
rates and other relative rights and preferences of the respective
series and classes, shall determine in good faith will result in fair
and equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the Corporation to
purchase or otherwise acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series 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 the Preferred
Stock to be created by resolution or resolutions of the Board of Directors,
subject to the conditions and restrictions or issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. Upon any voluntary
liquidation, dissolution or winding up of the Corporation, no distribution shall
be made (1) to the holders of shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the Series
Preferred Stock unless, prior thereto, the holders of shares of Series Preferred
Stock shall have received $100 per share, plus an amount equal to accrued and
unpaid dividends and distributions thereon, whether or not declared, to the date
of such payment, provided that the holders of shares of Series Preferred Stock
shall be entitled to receive an aggregate amount per share, subject to the
provisions for adjustment hereinafter set forth, equal to 100 times the
aggregate amount to be distributed per share to holders of Common Stock, or (2)
to the holders of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series Preferred Stock, except
distributions made ratably on the Series Preferred Stock and all other such
parity stock in proportion to the total amounts to which the holders of all such
shares are entitled upon such liquidation, dissolution or winding up. In the
event the Corporation shall at any time declare or pay any dividend on Common
Stock payable in shares of Common Stock, or effect a subdivision or combination
or consolidation of the outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of Common Stock) into a
greater or lesser number of shares of Common Stock, then in each such case the
aggregate amount to which holders of shares of Series Preferred Stock were
entitled immediately prior to such event under the proviso in clause (1) of the
preceding sentence shall be adjusted by multiplying such amount by a fraction
the numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
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 exchange for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares of
Series Preferred Stock shall at the same time be similarly exchanged or changed
in an amount per share (subject to the provision for adjustment hereinafter set
forth) equal to 100 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. In the event the
Corporation shall at any time declare or pay any dividend on Common Stock
payable in shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock) into a
greater or lesser number of shares of Common Stock, then in each such case the
amount set forth in the preceding sentence with respect to the exchange or
change or shares of Series Preferred Stock shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and denominator of which is the
number of shares of Common Stock that were outstanding immediately prior to such
event.
Section 8. No Redemption. The shares of Series Preferred Stock shall
not be redeemable.
Section 9. Amendment. The Certificate of Incorporation of the
Corporation shall not be amended in any manner which would materially alter or
change the powers, preferences or special rights of the Series Preferred Stock
so as to affect them adversely without the affirmative vote of the holders of
two-thirds or more of the outstanding shares of Series Preferred Stock, voting
together as a single class.
IN WITNESS WHEREOF, we have executed and subscribed this Certificate and do
affirm the foregoing as true under the penalties of perjury this 10th day of
December 1997.
Timothy C. Brown
Chairman of the Board
Phillip J. Stuecker, Secretary
EXHIBIT B
[Form of Rights Certificate]
Certificate No. R._
NOT EXERCISABLE AFTER JANUARY 5, 2008 OR EARLIER IF NOTICE
OF REDEMPTION IS GIVEN. THE RIGHTS ARE SUBJECT TO
REDEMPTION, AT THE OPTION OF THE COMPANY, AT $.02 PER RIGHT
ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY
ACQUIRING PERSONS (AS DEFINED IN THE RIGHTS AGREEMENT) AND
ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND
VOID.
Rights Certificate
THOMAS INDUSTRIES 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 5, 1998 (the "Rights Agreement")
between Thomas Industries Inc., a Delaware corporation (the "Company"), and The
Fifth Third Bank (the "Rights Agent"), to purchase from the Company at any time
after the Separation Date (as such term is defined in the Rights Agreement) and
prior to 5:00 P.M. (Cincinnati, Ohio time) on January 5, 2008 at the principal
corporate trust office of the Rights Agent, or its successor as Rights Agent,
one one-hundredth of a fully paid, nonassessable share of Series B Junior
Preferred stock (the "Preferred Stock") of the Company, at a purchase price of
$65 per one one-hundredth of a share (the "Purchase Price"), upon presentation
and surrender of this Rights Certificate with the Form of Election to Purchase
duly executed.
The number of Rights evidenced by this Rights Certificate (and the
number of shares which may be purchased upon exercise thereof) set forth above,
and the Purchase Price per share set forth above, are the number and Purchase
Price as of January 4, 1998. As provided in the Rights Agreement, the Purchase
Price, the type of security, and the number of shares of Preferred Stock or
common stock which may be purchased upon the exercise of the Rights evidenced by
this Rights Certificate are subject to modification and adjustment upon the
happening of certain events.
This Rights Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Rights Certificates. Copies of
the Rights Agreement are on file at the above-mentioned office of the Rights
Agent and are also available upon written request to the Rights Agent.
This Rights Certificate, with or without other Right Certificates,
upon surrender at the principal corporate trust office of the Rights Agent, may
be exchanged for another Rights Certificate or Rights Certificates of like tenor
and date evidencing Rights entitling the holder to purchase a like aggregate
number of shares of Preferred Stock as the Rights evidenced by the Rights
Certificate or Rights Certificates surrendered shall have entitled such holder
to purchase. If this Rights Certificate shall be exercised in part, the holder
shall be entitled to receive upon surrender hereof another Rights Certificate or
Rights Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Certificate may be redeemed by the Company at its option at a
redemption price of $.02 per Right.
No fractional shares of Preferred Stock will be issued upon the
exercise of any Right or Rights evidenced hereby (other than fractions which are
integral multiples of one one-hundredth of a share of Preferred Stock), but in
lieu thereof a cash payment will be made, as provided in the Rights Agreement.
No holder of this Rights Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of shares of Preferred
Stock or of any other securities of the Company which may at any time be
issuable on the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any
of the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give or withhold consent to any corporate action, or to
receive notice of meeting or other actions affecting stockholders (except as
provided in the Rights Agreement), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced by this Rights
Certificate shall have been exercised as provided in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company
and its corporate seal.
Dated as of ___________________, 1998
ATTEST: THOMAS INDUSTRIES INC.
____________________________ By:_________________________
Secretary President
Countersigned:
THE FIFTH THIRD BANK
By:_________________________
Authorized Signature
[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder is such holder desires to
transfer the Rights Certificate.)
FOR VALUE RECEIVED _________________________ hereby sells, assigns and transfers
unto _________________________________________________________________
(Please print name and address of transferee)
_________________________________________________________________ this Rights
Certificate, together with all right, title and interest therein, and does
hereby irrevocably constitute and appoint ________________ as attorney to
transfer the within Rights Certificate on the books of the within-named Company,
with full power of substitution.
Dated: _________________, ____
___________________________
Signature
Signature Guaranteed:
______________________________
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise
Rights represent by the Rights Certificate.)
To: THOMAS INDUSTRIES INC.
The undersigned hereby irrevocably elects to exercise ___________
Rights represented by this Rights Certificate to purchase the shares of
Preferred Stock issuable upon the exercise of the Rights and requests that
certificates for such shares be issued in the name of:
(Please insert social security or other identifying number) _______________
____________________________________________________________
(Please print name and address)
____________________________________________________________
____________________________________________________________
If such number of Rights shall not be all the Rights evidenced by this
Rights Certificate, a new Rights Certificate for the balance of such Rights
shall be registered in the name of and delivered to:
(Please insert social security or other identifying number)
________________
____________________________________________________________
(Please print name and address)
____________________________________________________________
____________________________________________________________
Dated: ________________, ____
_________________________
Signature
Signature Guaranteed:
___________________________
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Rights Certificate
[ ] are [ ] are not being exercised by or on behalf of a Person who is or
was an Acquiring Person other than an Approved Acquiring Person (as each
such term is defined in the Rights Agreement); and
(2) After due inquiry and to the best knowledge of the undersigned,
the undersigned [ ] did [ ] did not acquire the Rights evidenced by this
Rights Certificate after the earliest to occur of (a) the Separation Date
or (b) the Stock Acquisition date (as such terms are defined in the Rights
Agreement) from any Person who is, was or became an Acquiring Person other
than an Approved Acquiring Person.
Dated: ___________________, ____ ________________________
Signature
NOTICE
The signatures to the foregoing Election to Purchase and Certificate
must correspond to the name as written upon the face of this Rights Certificate
in every particular, without alteration or enlargement or any change whatsoever.
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE PREFERRED STOCK
Pursuant to action by the Board of Directors of Thomas Industries Inc. (the
"Company") on December 10, 1997, a dividend distribution was declared of one
preferred stock purchase right (the "Rights") on each outstanding share of
common stock, par value $1.00 per share (the "Common Stock") of the Company.
The distribution will be made to shareholders of record on January 4, 1998 (the
"Record Date"). The description and terms of the Rights are set forth in a
Rights Agreement (the "Rights Agreement") between the Company and The Fifth
Third Bank, as Rights Agent (the "Rights Agent"). The Rights Agreement
contemplates the issuance of one Right for every share of Common Stock issued
between the Record Date and the Separation Date (as defined below). The Rights
Agreement also contemplates the issuance of one Right for each share of Common
Stock which is issued pursuant to any employee benefit plan or arrangement
established prior to the Separation Date. Except as set forth below, each Right
will entitle the registered holder thereof to purchase from the Company a unit
consisting of one one-hundredth of share (a "unit") of the Company's Series B
Junior Preferred Stock, par value $1.00 per share (the "Preferred Stock"), at a
purchase price of $65 per Unit (the "Purchase Price"), subject to anti-dilutive
adjustments described below.
The Rights will be represented by the Common Stock certificates and will
not be exercisable or transferable apart from the Common Stock until the earlier
to occur of (i) ten days following a public announcement that a person or group
of affiliated or associated persons (an "Acquiring Person"), has acquired, or
obtained the right to acquire, beneficial ownership of 20% or more of the
outstanding shares of Common Stock (the "Stock Acquisition Date") or (ii) ten
days following the commencement of (or announcement of an intention to make) a
tender offer or exchange offer if, upon consummation thereof, such person or
group would be the beneficial owner of 20% or more of the outstanding shares of
Common Stock (the earlier of such dates being called the "Separation Date").
Until the Separation Date (or earlier redemption or expiration of the Rights),
new Common Stock certificates issued after the Record Date upon transfer or new
issuance of Common Stock will contain a notation incorporating the Rights
Agreement by reference. As soon as practicable following the Separation Date,
separate certificates evidencing the Rights (the "Rights Certificates") will be
mailed to holders of record of the Common Stock as of the close of business on
the Separation Date. From and after the Separation Date, the separate Rights
Certificates alone will evidence the Rights. The Rights will expire at the
close of business on January 5, 2008 (the "Final Expiration Date") unless
earlier redeemed by the Company as described below.
In the event that, at any time following the Separation Date, (i) the
Company is the surviving corporation in a merger with or involving an Acquiring
Person and its Common Stock shall remain outstanding, or (ii) an Acquiring
Person becomes the beneficial owner of 20% or more of the then outstanding
shares of Common Stock, except pursuant to an offer for all outstanding Common
Stock at a price and upon terms and conditions as a majority of the Continuing
Directors determine to be in the best interest of the Company and its
shareholders, other than the Acquiring Person, or (iii) an Acquiring Person
engages in any of a number of enumerated self-dealing transactions without the
approval of a majority of the Continuing Directors, each holder of a Right will
thereafter have the right to receive, upon the exercise thereof at the then
current Purchase Price, a number of shares of Common Stock which at the time of
such transaction would have a market value of two times the current Purchase
Price. Notwithstanding the foregoing, no Right will be exercisable for Common
Stock of the Company until the Rights have become non-redeemable, as described
below. In the event that, at any time following the Separation Date, the
Company is acquired in a merger or other business combination transaction or 50%
or more of its assets or earning power is sold, each holder of a Right will
thereafter have the right to receive, upon the exercise thereof at the then
current Purchase Price, a number of shares of common stock of the acquiring
company which at the time of such transaction would have a market value of two
times such Purchase Price. If the Company would be prohibited by its
Certificate of Incorporation from issuing securities to certain holders of the
Rights upon exercise thereof, the Rights Agreement provides alternate means for
giving such holders the benefit of their Rights. Any of the events described in
this paragraph is defined as a "Triggering Event." Following the occurrence of
any of the above-mentioned Triggering Events, any Rights that are or were
beneficially owned by the Acquiring Person will be null and void.
In general, a Continuing Director is a director of the Company who is not
an Acquiring Person and who was elected to the Board prior to the time the
Acquiring Person in question became such or who was designated Continuing
Director by a majority of the Board of Directors or a majority of the then
Continuing Directors.
The Purchase Price payable, and the number of Units of Preferred Stock or
other securities or property issuable, upon exercise of the Rights, are subject
to adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Preferred
Stock, (ii) upon the grant to holders of the Preferred Stock of certain rights
or warrants to subscribe for Preferred Stock or convertible securities at less
than the current market price of the Preferred Stock, or (iii) upon the
distribution to holders of the Preferred Stock of evidences of indebtedness or
assets (excluding regular quarterly cash dividends) or of subscription rights or
warrants (other than those referred to above).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% of
such Purchase Price. No fractional Units will be issued and, in lieu thereof,
an adjustment in cash will be made based on the market price of the Preferred
Stock on the last trading date prior to the date of exercise.
On the earlier of (i) the Stock Acquisition Date, or (ii) the Final
Expiration Date, the Company may redeem the Rights in whole, but not in part, at
a price of $.02 per Right (the "Redemption Price"). Immediately upon the action
of the Board of Directors of the Company ordering redemption of the Rights, the
Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends.
The present distribution of the Rights is not taxable to the Company or its
shareholders. Until they are exercisable, the Rights are not dilutive nor will
they affect reported earnings per share. The Company will receive no proceeds
from the issuance of the Rights as a dividend.
As long as the Rights are attached to the Common Stock, the Company will
issue one Right with each new share of Common Stock issued so that all such
shares will have attached Rights. After the Separation Date but prior to the
Expiration Date, Rights shall only be issued in connection with the issuance of
Common Stock upon the exercise of stock options granted prior to the Separation
Date or pursuant to other benefits under any employee plan or arrangement
established prior to the Separation Date.
The terms of the Rights other than the Purchase Price, the Redemption
Price, and the period during which the Rights are redeemable, may be amended by
the Board of Directors of the Company; provided, however, that the amendment
will not adversely affect the interests of holders of Rights other than an
Acquiring Person.
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 Company,
attention: Chief Financial Officer. This summary description of the rights does
not purport to be complete and is qualified in its entirety by reference to the
Rights Agreement, which is incorporated herein by reference.
THOMAS INDUSTRIES, INC. NEWS RELEASE
Executive Office
4360 Brownsboro Road, Suite 300
P. O. Box 35120
Louisville, Kentucky 40232-5120
(502) 893-4600 - (502) 895-6618 FAX
THOMAS INDUSTRIES ADOPTS NEW SHAREHOLDER RIGHTS AGREEMENT
Louisville, KY., December 10, 1997 - Thomas Industries Inc. (NYSE: TII)
announced today that its Board of Directors has adopted a Shareholder Rights
Agreement, effective January 5, 1998, to replace the Rights Amendment currently
in effect which will expire on January 4, 1998. As with the existing agreement,
the new agreement is designed to deter coercive takeover tactics and provide the
Thomas Industries Board with the opportunity to fully analyze and consider an
offers for the Company.
Timothy C. Brown, Chairman, President and Chief Executive Officer of Thomas
Industries, said, "While we are not aware of any current efforts to acquire
Thomas Industries, the Rights Agreement contains provisions to protect all
shareholders in the event of an unsolicited attempt to acquire Thomas Industries
through abusive takeover tactics."
The Rights Agreement provides rights to shareholders to purchase shares of
Thomas Industries preferred stock. The rights become exercisable only if (1) an
individual or group announces a tender offer or intends to commence a tender
offer for 20% or more of the outstanding Thomas Industries common stock or (2)
an individual or group actually acquires 20% or more of the outstanding Thomas
Industries common stock. Each right would entitle the holder to purchase one
one-hundredth of a preferred share at a purchase price of $65.00. The rights
alternatively entitle the holder to purchase Thomas Industries common shares at
a significant discount to the market price. The Rights Agreement also provides
special procedures in the even there is an inadvertent acquisition of Company
stock that exceeds the 20% threshold set forth in the Rights Agreement. The
Board may also elect to redeem the rights under certain circumstances at $0.02
per right. Distribution of the rights is not taxable to the shareholders.
Thomas Industries Inc., headquartered in Louisville, Kentucky, is a
recognized leader in the design and manufacture of commercial, industrial and
consumer lighting products as well as compressors and vacuum pumps for global
OEM applications. Thomas Industries has operations in the United States,
Canada, Mexico, South America, Europe and Asia, and has approximately 3,300
employees.
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