RENEWAL RIGHTS AGREEMENT
DATED AS OF SEPTEMBER 14, 2000
BETWEEN
INDEPENDENT BANK CORP.
AND
ROCKLAND TRUST COMPANY,
AS RIGHTS AGENT
TABLE OF CONTENTS
PAGE
SECTION 1. Certain Definitions................................................................................1
SECTION 2. Appointment of Rights Agent........................................................................6
SECTION 3. Issue of Right Certificates........................................................................6
SECTION 4. Form of Right Certificates.........................................................................8
SECTION 5. Countersignature and Registration..................................................................9
SECTION 6. Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated, Destroyed, Lost or
Stolen Right Certificates.........................................................................10
SECTION 7. Exercise of Rights; Exercise Price; Expiration Date of Rights.....................................11
SECTION 8. Cancellation and Destruction of Right Certificates................................................13
SECTION 9. Reservation and Availability of Preferred Stock...................................................13
SECTION 10. Preferred Stock Record Date.......................................................................14
SECTION 11. Adjustment of Exercise Price, Number and Kind of Shares or Number of Rights.......................15
SECTION 12. Certificate of Adjusted Exercise Price or Number of Shares........................................23
SECTION 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power..............................23
SECTION 14. Fractional Rights and Fractional Shares...........................................................26
SECTION 15. Rights of Action..................................................................................27
SECTION 16. Agreement of Right Holders........................................................................27
SECTION 17. Right Certificate Holder Not Deemed a Shareholder.................................................28
SECTION 18. Concerning the Rights Agent.......................................................................28
SECTION 19. Merger or Consolidation or Change of Name of Rights Agent.........................................28
SECTION 20. Duties of Rights Agent............................................................................29
SECTION 21. Change of Rights Agent............................................................................31
SECTION 22. Issuance of New Right Certificates................................................................32
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SECTION 23. Redemption........................................................................................32
SECTION 24. Exchange..........................................................................................33
SECTION 25. Notice of Certain Events..........................................................................35
SECTION 26. Notices...........................................................................................35
SECTION 27. Supplements and Amendments........................................................................36
SECTION 28. Successors........................................................................................37
SECTION 29. Determinations and Actions by the Board of Directors..............................................37
SECTION 30. Benefits of this Agreement........................................................................38
SECTION 31. Severability......................................................................................38
SECTION 32. Governing Law.....................................................................................38
SECTION 33. Counterparts......................................................................................38
SECTION 34. Descriptive Headings..............................................................................38
EXHIBITS
EXHIBIT A -- Certificate of Vote of Directors Establishing a Series of a Class of Stock
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EXHIBIT B -- Form of Right Certificate
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RENEWAL RIGHTS AGREEMENT
RENEWAL RIGHTS AGREEMENT (the "AGREEMENT"), dated as of September 14,
2000, between Independent Bank Corp., a Massachusetts corporation (the
"Company"), and Rockland Trust Company, a Massachusetts chartered trust company
(the "RIGHTS AGENT").
W I T N E S S E T H
WHEREAS, the Company and the Rights Agent entered into a Rights
Agreement dated as of January 24, 1991 (the "EXISTING RIGHTS AGREEMENT"),
pursuant to which, among other things, the Board of Directors of the Company
authorized and declared a dividend distribution of one right per share of Common
Stock of the Company (as hereinafter defined) to holders of outstanding shares
of Common Stock of the Company on the record date set forth in the Existing
Rights Agreement;
WHEREAS, the Board of Directors desires to provide stockholders of the
Company with the opportunity to benefit from the long-term prospects and value
of the Company and to ensure that stockholders of the Company receive fair and
equal treatment in the event of any proposed takeover of the Company;
WHEREAS, the Board of Directors has determined that it is in the best
interests of the stockholders of the Company to enter into this Agreement which
shall take effect contemporaneously with the expiration of the Existing Rights
Agreement on its final expiration date of May 3, 2001 as set forth in the
Existing Rights Agreement;
WHEREAS, on September 14, 2000, the Board of Directors has authorized
and declared a dividend distribution of one Right (as such term is hereinafter
defined) for each outstanding share of Common Stock of the Company outstanding
as of the Close of Business (as such term is hereinafter defined) on May 3, 2001
(the "RECORD DATE"), and the Agreement provides for the issuance of one Right
for each share of Common Stock of the Company issued (whether originally issued
or sold from the Company's treasury, except in the case of treasury shares
having associated Rights) between the Record Date and the earlier of the
Distribution Date or the Expiration Date (as such terms are hereinafter
defined), each Right initially representing the right to purchase one
one-thousandth of a share of Series B Junior Participating Cumulative Preferred
Stock of the Company having the rights, powers and preferences set forth on
EXHIBIT A hereto, upon the terms and subject to the conditions hereinafter set
forth (the "RIGHTS"); and
WHEREAS, the Company desires to appoint the Rights Agent to act as
rights agent hereunder, in accordance with the terms and conditions hereof;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
SECTION 1. CERTAIN DEFINITIONS. For purposes of this Agreement,
the following terms have the meanings indicated:
(a) "ACQUIRING PERSON" shall mean any Person (as hereinafter defined)
who or which, together with all Affiliates (as such term is hereinafter defined)
and Associates (as such
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term is hereinafter defined) of such Person, shall be the Beneficial Owner (as
such term is hereinafter defined) of 15% or more of the shares of Common Stock
of the Company then outstanding, but shall not include (i) the Company, (ii) any
Subsidiary (as such term is hereinafter defined) of the Company, (iii) any
employee benefit plan or compensation arrangement of the Company or any
Subsidiary of the Company, or (iv) any Person holding shares of Common Stock of
the Company organized, appointed or established by the Company or any Subsidiary
of the Company for or pursuant to the terms of any such employee benefit plan or
compensation arrangement (each of the Persons described in clauses (i) through
(iv) above are referred to herein as an "EXEMPT PERSON").
Notwithstanding the foregoing, no Person shall become an "Acquiring
Person" as the result of an acquisition of the Company's Common Stock by the
Company which, by reducing the number of shares outstanding, increases the
proportionate number of shares beneficially owned by such Person to 15% or more
of the shares of Common Stock of the Company then outstanding; provided,
however, that if a Person shall become the Beneficial Owner of 15% or more of
the shares of Common Stock of the Company then outstanding by reason of share
purchases by the Company and shall, after such share purchases by the Company,
become the Beneficial Owner of any additional shares (other than pursuant to a
stock split, stock dividend or similar transaction) of Common Stock of the
Company and immediately thereafter be the Beneficial Owner of 15% or more of the
shares of Common Stock of the Company then outstanding, then such Person shall
be deemed to be an "Acquiring Person."
In addition, notwithstanding the foregoing, a Person shall not be an
"Acquiring Person" if the Board of Directors determines that a Person who would
otherwise be an "Acquiring Person," as defined pursuant to the foregoing
provisions of this Section 1(a), has become such inadvertently, and such Person
divests as promptly as practicable (or within such period of time as the Board
of Directors determines is reasonable) a sufficient number of shares of Common
Stock of the Company so that such Person would no longer be an "Acquiring
Person," as defined pursuant to the foregoing provisions of this Section 1(a).
(b) "ADJUSTMENT SHARES" shall have the meaning set forth in Section
11(a)(ii) hereof.
(c) "ADVERSE PERSON" shall mean any Person declared to be an Adverse
Person by the Board of Directors upon a determination of the Board of Directors
that the criteria set forth in Section 11(a)(ii)(B) apply to such Person.
(d) "AFFILIATE" and "ASSOCIATE" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations (the
"Rules") under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), as in effect on the date of this Agreement; provided, however, that no
Person who is a director or officer of the Company shall be deemed an Affiliate
or an Associate of any other director or officer of the Company solely as a
result of his or her position as director or officer of the Company.
(e) A Person shall be deemed the "BENEFICIAL OWNER" of, and shall be
deemed to "beneficially own," any securities:
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(i) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, beneficially owns (as determined
pursuant to Rule 13d-3 of the Rules under the Exchange Act, as in effect on
the date of this Agreement);
(ii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has:
(A) the right to acquire (whether such right is exercisable
immediately or only after the passage of time or upon the satisfaction
of any conditions or both) pursuant to any agreement, arrangement or
understanding (whether or not in writing) (other than customary
agreements with and between underwriters and selling group members
with respect to a bona fide public offering of securities) or upon the
exercise of conversion rights, exchange rights, rights (other than the
Rights), warrants or options, or otherwise; provided, however, that a
Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially own," (1) securities tendered pursuant to a tender or
exchange offer made by or on behalf of such Person or any of such
Person's Affiliates or Associates until such tendered securities are
accepted for purchase or exchange; (2) securities issuable upon
exercise of Rights at any time prior to the occurrence of a Triggering
Event; or (3) securities issuable upon exercise of Rights from and
after the occurrence of a Triggering Event, which Rights were acquired
by such Person or any of such Person's Affiliates or Associates prior
to the Distribution Date or pursuant to Sections 3(a), 11(i) or 22
hereof; or
(B) the right to vote pursuant to any agreement, arrangement or
understanding (whether or not in writing); provided, however, that a
Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially own," any security under this clause (B) if the
agreement, arrangement or understanding to vote such security (1)
arises solely from a revocable proxy given in response to a public
proxy or consent solicitation made pursuant to, and in accordance
with, the Rules of the Exchange Act, and (2) is not also then
reportable by such person on Schedule 13D under the Exchange Act (or
any comparable or successor report); or
(C) the right to dispose of pursuant to any agreement,
arrangement or understanding (whether or not in writing) (other than
customary arrangements with and between underwriters and selling group
members with respect to a bona fide public offering of securities); or
(iii) which are beneficially owned, directly or indirectly, by any
other Person (or any Affiliate or Associate thereof) with which such Person
or any of such Person's Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing) (other than
customary agreements with and between underwriters and selling group
members with respect to a bona fide public offering of securities) for the
purpose of acquiring, holding, voting (except pursuant to a revocable proxy
as described in clause (B) of Section 1(e)(ii) hereof) or disposing of any
securities of the Company; provided, however, that (1) no Person engaged in
business as an underwriter of securities shall be deemed the Beneficial
Owner of any securities acquired
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through such Person's participation as an underwriter in good faith in a
firm commitment underwriting until the expiration of forty (40) days after
the date of such acquisition, and (2) no Person who is a director or an
officer of the Company shall be deemed, as a result of his or her position
as director or officer of the Company, the Beneficial Owner of any
securities of the Company that are beneficially owned by any other director
or officer of the Company.
(f) "BOARD OF DIRECTORS" shall mean the Board of Directors of the
Company.
(g) "BUSINESS DAY" shall mean any day other than a Saturday, Sunday, or a
day on which banking institutions in the Commonwealth of Massachusetts are
authorized or obligated by law or executive order to close.
(h) "CLOSE OF BUSINESS" on any given date shall mean 5:00 P.M., Boston,
Massachusetts time, on such date; provided, however, that if such date is not a
Business Day it shall mean 5:00 P.M., Boston, Massachusetts time, on the next
succeeding Business Day.
(i) "COMMON STOCK" when used in reference to the Company shall mean the
common stock, par value $0.01 per share, of the Company or any other shares of
capital stock of the Company into which such stock shall be reclassified or
changed. "Common Stock" when used with reference to any Person other than the
Company organized in corporate form shall mean (i) the capital stock or other
equity interest of such Person with the greatest voting power, (ii) the equity
securities or other equity interest having power to control or direct the
management of such Person, or (iii) if such Person is a Subsidiary of another
Person, the Person or Persons which ultimately control such first-mentioned
Person and which have issued any such outstanding capital stock, equity
securities or equity interest. "Common Stock" when used with reference to any
Person not organized in corporate form shall mean units of beneficial interest
which shall be entitled to exercise the greatest voting power of such Person or,
in the case of a limited partnership, shall have the power to remove or
otherwise replace the general partner or partners.
(j) "CURRENT VALUE" shall have the meaning set forth in Section
11(a)(iii) hereof.
(k) "DEPOSITARY AGENT" shall have the meaning set forth in Section 7(c)
hereof.
(l) "DISTRIBUTION DATE" shall have the meaning defined in Section 3(a)
hereof.
(m) "EXCHANGE ACT" shall have the meaning set forth in the definition of
"Affiliate" and "Associate."
(n) "EXEMPT PERSON" shall have the meaning set forth in the definition of
"Acquiring Person."
(o) "EXERCISE PRICE" shall have the meaning defined in Section 4(a)
hereof.
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(p) "EXPIRATION DATE" and "FINAL EXPIRATION DATE" shall have the meanings
set forth in Section 7(a) hereof.
(q) "FAIR MARKET VALUE" of any securities or other property shall be as
determined in accordance with Section 11(d) hereof.
(r) "GROUP" shall have the meaning set forth in clause (b) of the
definition of "Person."
(s) "NASDAQ" shall have the meaning set forth in Section 9(b) hereof.
(t) "PERSON" shall mean (a) an individual, a corporation, a partnership,
an association, a joint stock company, a trust, a business trust, a government
or political subdivision, any unincorporated organization, or any other
association or entity, or (b) a "group" as that term is used for purposes of
Section 13(d)(3) of the Securities Exchange Act of 1934, as amended (any such
group under this clause (b), a "Group").
(u) "PREFERRED STOCK" shall mean shares of Series B Junior Participating
Cumulative Preferred Stock, par value $.01 per share, of the Company having the
rights and preferences set forth in the form of Certificate of Vote of Directors
Establishing a Series of a Class of Stock attached hereto as EXHIBIT A.
(v) "PREFERRED STOCK EQUIVALENTS" shall have the meaning set forth in
Section 11(b) hereof.
(w) "PRINCIPAL PARTY" shall have the meaning defined in Section 13(b)
hereof.
(x) "REDEMPTION PRICE" shall have the meaning defined in Section 23
hereof.
(y) "REGISTERED COMMON STOCK" shall have the meaning set forth in Section
13(b) hereof.
(z) "RIGHTS" shall have the meaning set forth in the fourth WHEREAS
clause of this Agreement.
(aa) "RIGHT CERTIFICATE" shall have the meaning set forth in Section 3(a)
hereof.
(bb) "SECTION 11(a)(ii) EVENT" shall mean any event described in Section
11(a)(ii) hereof.
(cc) "SECTION 11(a)(ii) TRIGGER DATE" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(dd) "SECTION 13 EVENT" shall mean any event described in clauses (x),
(y) or (z) of Section 13(a) hereof.
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(ee) "SECTION 24(a)(i) EXCHANGE RATIO" shall have the meaning set forth
in Section 24(a)(i) hereof.
(ff) "SECTION 24(a)(ii) EXCHANGE RATIO" shall have the meaning set forth
in Section 24(a)(ii) hereof.
(gg) "SECURITIES ACT" shall have the meaning set forth in Section 9(c)
hereof.
(hh) "SPREAD" shall have then meaning set forth in Section 11(a)(iii)
hereof.
(ii) "STOCK ACQUISITION DATE" shall mean the date of the first public
announcement (which for purposes of this definition shall include, without
limitation, the issuance of a press release or the filing of a
publicly-available report or other document with the Securities and Exchange
Commission or any other governmental agency) by the Company or an Acquiring
Person that an Acquiring Person has become such.
(jj) "SUBSIDIARY" shall mean, with reference to any Person, any
corporation or other entity of which securities or other ownership interest
having ordinary voting power sufficient, in the absence of contingencies, to
elect a majority of the board of directors or other persons performing similar
functions of such corporation or other entity are at the time directly or
indirectly beneficially owned or otherwise controlled by such Person and any
Affiliate of such Person.
(kk) "SUBSTITUTION PERIOD" shall have the meaning set forth in Section
11(a)(iii) hereof.
(ll) "TRIGGERING EVENT" shall mean any Section 11(a)(ii) Event or any
Section 13 Event.
SECTION 2. APPOINTMENT OF RIGHTS AGENT.
(a) The Company hereby appoints the Rights Agent to act as agent for the
Company and the holders of the Rights (who, in accordance with Section 3 hereof,
shall prior to the Distribution Date (as hereinafter defined in Section 3(a))
also be the holders of the Common Stock of the Company) in accordance with the
terms and conditions hereof, and the Rights Agent hereby accepts such
appointment. The Company may from time to time appoint such Co-Rights Agents as
it may deem necessary or desirable. In the event the Company appoints one or
more Co-Rights Agents, the respective duties of the Rights Agent and any
Co-Rights Agents shall be as the Company shall determine. The Company shall give
notice to the Rights Agent of the appointment of one or more Co-Rights Agents
and the respective duties of the Rights Agent and any such Co-Rights Agents.
SECTION 3. ISSUE OF RIGHT CERTIFICATES.
(a) From May 3, 2001 until the earlier of (i) the Close of Business on
the tenth calendar day after the Stock Acquisition Date, (ii) the Close of
Business on the tenth Business Day (or such other calendar day, if any, as the
Board of Directors may determine in its sole discretion) after the date a tender
or exchange offer by any Person, other than an Exempt Person,
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is first published or sent or given within the meaning of Rule 14d-4(a) of the
Exchange Act, or any successor rule, if, upon consummation thereof, such Person
would be the Beneficial Owner of 15% or more of the shares of Common Stock of
the Company then outstanding, or (iii) the determination by the Board of
Directors, pursuant to the criteria set forth in Section 11(a)(ii)(B) hereof,
that a Person is an Adverse Person (including any such date which is after the
date of this Agreement and prior to the issuance of the Rights) (the earlier of
such dates being herein referred to as the "DISTRIBUTION DATE"), (x) the Rights
will be evidenced (subject to the provisions of Section 3(b) hereof) by the
certificates for the Common Stock of the Company registered in the names of the
holders of the Common Stock of the Company (which certificates for Common Stock
of the Company shall be deemed also to be certificates for Rights) and not by
separate certificates, and (y) the Rights will be transferable only in
connection with the transfer of the underlying shares of Common Stock of the
Company. As soon as practicable after the Distribution Date, the Rights Agent
will, at the Company's expense send, by first-class, insured, postage prepaid
mail, to each record holder of the Common Stock of the Company as of the Close
of Business on the Distribution Date, at the address of such holder shown on the
records of the Company, one or more certificates, in substantially the form of
EXHIBIT B hereto (individually, a "RIGHT CERTIFICATE"), evidencing one Right for
each share of Common Stock of the Company so held, subject to adjustment as
provided herein. In the event that an adjustment in the number of Rights per
share of Common Stock of the Company has been made pursuant to Section 11(o)
hereof, the Company may make the necessary and appropriate rounding adjustments
(in accordance with Section 14(a) hereof) at the time of distribution of the
Right Certificates, so that Right Certificates representing only whole numbers
of Rights are distributed and cash is paid in lieu of any fractional Rights. As
of and after the Close of Business on the Distribution Date, the Rights will be
evidenced solely by such Right Certificates.
(b) With respect to certificates for the Common Stock of the Company
issued prior to the Close of Business on the Record Date, the Rights will be
evidenced by such certificates for the Common Stock of the Company on or until
the Distribution Date (or the earlier redemption, expiration or termination of
the Rights), and the registered holders of the Common Stock of the Company also
shall be the registered holders of the associated Rights. Until the Distribution
Date (or the earlier redemption, expiration or termination of the Rights), the
transfer of any of the certificates for the Common Stock of the Company
outstanding prior to the date of this Agreement shall also constitute the
transfer of the Rights associated with the Common Stock of the Company
represented by such certificate.
(c) Certificates for the Common Stock of the Company issued after the
Record Date, but prior to the earlier of the Distribution Date or the
redemption, expiration or termination of the Rights, shall be deemed also to be
certificates for Rights, and shall bear a legend, substantially in the form set
forth below:
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in a Renewal Rights Agreement between
Independent Bank Corp. and Rockland Trust Company, as Rights Agent,
dated as of September 14, 2000, as amended, restated, renewed or
extended from time to time (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 Independent Bank Corp. and the
stock transfer
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administration office of the Rights Agent. Under certain
circumstances, as set forth in the Rights Agreement, such Rights will
be evidenced by separate certificates and will no longer be evidenced
by this certificate. Independent Bank Corp. may redeem the Rights at a
redemption price of $.001 per Right, subject to adjustment, under the
terms of the Rights Agreement. Independent Bank Corp. will mail to the
holder of this certificate a copy of the Rights Agreement, as in
effect on the date of mailing, without charge promptly after receipt
of a written request therefor. Under certain circumstances, Rights
issued to or held by Acquiring Persons, Adverse Persons or any
Affiliates or Associates thereof (as defined in the Rights Agreement),
and any subsequent holder of such Rights, may become null and void.
The Rights shall not be exercisable, and shall be void so long as
held, by a holder in any jurisdiction where the requisite
qualification, if any, to the issuance to such holder, or the exercise
by such holder, of the Rights in such jurisdiction shall not have been
obtained or be obtainable.
With respect to such certificates containing the foregoing legend, the
Rights associated with the Common Stock of the Company represented by such
certificates shall be evidenced by such certificates alone until the
Distribution Date (or the earlier redemption, expiration or termination of the
Rights), and the transfer of any of such certificates shall also constitute the
transfer of the Rights associated with the Common Stock of the Company
represented by such certificates. In the event that the Company purchases or
acquires any shares of Common Stock of the Company after the Record Date but
prior to the Distribution Date, any Rights associated with such Common Stock of
the Company shall be deemed canceled and retired so that the Company shall not
be entitled to exercise any Rights associated with the shares of Common Stock of
the Company which are no longer outstanding. The failure to print the foregoing
legend on any such certificate representing Common Stock of the Company or any
defect therein shall not affect in any manner whatsoever the application or
interpretation of the provisions of Section 7(e) hereof.
SECTION 4. FORM OF RIGHT CERTIFICATES.
(a) The Right Certificates (and the forms of election to purchase shares
and of assignment and certificate to be printed on the reverse thereof) shall
each be substantially in the form of EXHIBIT B hereto and may have such marks of
identification or designation and such legends, summaries or endorsements
printed thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
applicable law, rule or regulation or with any rule or regulation of any stock
exchange on which the Rights may from time to time be listed, or to conform to
customary usage. The Right Certificatess shall be in a machine printable format
and in a form reasonably satisfactory to the Rights Agent. Subject to the
provisions of Section 11 and Section 22 hereof, the Right Certificates, whenever
distributed, shall be dated as of the Record Date, shall show the date of
countersignature, and on their face shall entitle the holders thereof to
purchase such number of one one-thousandth of a share of Preferred Stock as
shall be set forth therein at the price set forth therein (the "EXERCISE
PRICE"), but the number of such shares and the Exercise Price shall be subject
to adjustment as provided herein.
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(b) Any Right Certificate issued pursuant to Section 3(a) or Section 22
hereof that represents Rights beneficially owned by (i) an Acquiring Person, an
Adverse Person or any Associate or Affiliate of an Acquiring Person or an
Adverse Person, (ii) a transferee of an Acquiring Person or an Adverse Person
(or of any Associate or Affiliate of an Acquiring Person or an Adverse Person)
who becomes a transferee after the Acquiring Person or Adverse Person becomes
such, or (iii) a transferee of an Acquiring Person or an Adverse Person (or of
any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person or Adverse Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person or Adverse Person to holders of equity
interests in such Acquiring Person or Adverse Person or to any Person with whom
the Acquiring Person or Adverse Person has any continuing agreement, arrangement
or understanding (whether or not in writing) regarding the transferred Rights,
the shares of Common Stock of the Company associated with such Rights or the
Company, or (B) a transfer which the Board of Directors has determined is part
of a plan, arrangement or understanding which has as a primary purpose or effect
the avoidance of Section 7(e) hereof, and any Right Certificate issued pursuant
to Section 6, Section 11 or Section 22 upon transfer, exchange, replacement or
adjustment of any other Right Certificate referred to in this sentence, shall
have deleted therefrom the fourth sentence of the existing legend on such Right
Certificate and in substitution therefor shall contain the following legend:
The Rights represented by this Right Certificate are or were
beneficially owned by a Person who was or became an Acquiring
Person, an Adverse Person or an Affiliate or an Associate of an
Acquiring Person or an Adverse Person (as such terms are defined
in the Rights Agreement). This Right Certificate and the Rights
represented hereby may become null and void under certain
circumstances as specified in Section 7(e) of the Renewal Rights
Agreement.
The Company shall give notice to the Rights Agent promptly after it
becomes aware of the existence and identity of any Acquiring Person or Adverse
Person or any Associate or Affiliate thereof. The Company shall instruct the
Rights Agent in writing of the Rights which should be so legended. The failure
to print the foregoing legend on any such Right Certificate or any defect
therein shall not affect in any manner whatsoever the application or
interpretation of the provisions of Section 7(e) hereof.
SECTION 5. COUNTERSIGNATURE AND REGISTRATION.
(a) The Right Certificates shall be executed on behalf of the Company by
its Chairman of the Board of Directors, or its President or any Vice President
and by its Treasurer or any Assistant Treasurer, or by its Clerk or any
Assistant Clerk, either manually or by facsimile signature, and shall have
affixed thereto the Company's seal or a facsimile thereof which shall be
attested to by the Clerk or any Assistant Clerk of the Company, either manually
or by facsimile signature. The Right Certificates shall be manually
countersigned by an authorized signatory of the Rights Agent and shall not be
valid for any purpose unless so countersigned, and such countersignature upon
any Right Certificate shall be conclusive evidence, and the only evidence, that
such Right Certificate has been duly countersigned as required hereunder. In
case any officer of the Company who shall have signed any of the Right
Certificates shall cease to be such
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officer of the Company before countersignature by the Rights Agent and issuance
and delivery by the Company, such Right Certificates, nevertheless, may be
countersigned by an authorized signatory of the Rights Agent, and issued and
delivered by the Company with the same force and effect as though the person who
signed such Right Certificates had not ceased to be such officer of the Company;
and any Right Certificates may be signed on behalf of the Company by any person
who, at the actual date of the execution of such Right Certificate, shall be a
proper officer of the Company to sign such Right Certificate, although at the
date of the execution of this Rights Agreement any such person was not such an
officer.
(b) Following the Distribution Date, the Rights Agent will keep or cause
to be kept, at one of its offices designated as the appropriate place for
surrender of Right Certificates upon exercise or transfer, books for
registration and transfer of the Right Certificates issued hereunder. Such books
shall show the names and addresses of the respective holders of the Right
Certificates, the number of Rights evidenced on its face by each of the Right
Certificates and the date of each of the Right Certificates.
SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF RIGHT
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHT CERTIFICATES.
(a) Subject to the provisions of Section 4(b), Section 7(e) and Section
14 hereof, at any time after the Close of Business on the Distribution Date, and
at or prior to the Close of Business on the Expiration Date, any Right
Certificate or Certificates may be transferred, split up, combined or exchanged
for another Right Certificate or Certificates, entitling the registered holder
to purchase a like number of one one-thousandth of a share of Preferred Stock
(or following a Triggering Event, preferred stock, cash, property, debt
securities, Common Stock of the Company or any combination thereof) as the Right
Certificate or Certificates surrendered then entitled such holder to purchase
and at the same Exercise Price. Any registered holder desiring to transfer,
split up, combine or exchange any Right Certificate shall make such request in
writing delivered to the Rights Agent, and shall surrender the Right Certificate
or Certificates to be transferred, split up, combined or exchanged, with the
form of assignment and certificate duly executed, at the office or offices of
the Rights Agent designated for such purpose. Neither the Rights Agent nor the
Company shall be obligated to take any action whatsoever with respect to the
transfer of any such surrendered Right Certificate until the registered holder
shall have completed and signed the certificate contained in the form of
assignment on the reverse side of such Right Certificate and shall have provided
such additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company shall
reasonably request. Thereupon the Rights Agent shall, subject to Section 4(b),
Section 7(e) and Section 14 hereof, countersign and deliver to the Person
entitled thereto a Right Certificate or Certificates, as the case may be, as so
requested. The Company may require payment by the registered holder of a Right
Certificate, of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any transfer, split up, combination or
exchange of Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation of
a Right Certificate, and, in case of loss, theft or destruction, of indemnity or
security satisfactory to them, and reimbursement to the Company and the Rights
Agent of all reasonable expenses incidental
- 10 -
thereto, and upon surrender to the Rights Agent and cancellation of the Right
Certificate, if mutilated, the Company will execute and deliver a new Right
Certificate of like tenor to the Rights Agent for countersignature and delivery
to the registered owner in lieu of the Right Certificate so lost, stolen,
destroyed or mutilated.
SECTION 7. EXERCISE OF RIGHTS; EXERCISE PRICE; EXPIRATION DATE OF RIGHTS.
(a) Subject to Section 7(e) hereof, the registered holder of any Right
Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein) in whole or in part at any time after the Distribution Date
upon surrender of the Right Certificate, with the form of election to purchase
and the certificate on the reverse side thereof duly executed, to the Rights
Agent at the office or offices of the Rights Agent designated for such purpose,
together with payment of the aggregate Exercise Price for the total number of
one one-thousandth of a share of Preferred Stock (or other securities, cash or
other assets, as the case may be) as to which such surrendered Rights are then
exercised, at or prior to the earlier of (i) the Close of Business on May 3,
2011 (the "FINAL EXPIRATION DATE"), (ii) the time at which the Rights are
redeemed as provided in Section 23 hereof, or (iii) the time at which such
Rights are exchanged as provided in Section 24 hereof (the earlier of (i), (ii)
or (iii) being herein referred to as the "EXPIRATION DATE"). Except as set forth
in Section 7(e) hereof and notwithstanding any other provision of this
Agreement, any Person who prior to the Distribution Date becomes a record holder
of shares of Common Stock of the Company may exercise all of the rights of a
registered holder of a Right Certificate with respect to the Rights associated
with such shares of Common Stock of the Company in accordance with the
provisions of this Agreement, as of the date such Person becomes a record holder
of shares of Common Stock of the Company.
(b) The Exercise Price for each one one-thousandth of a share of
Preferred Stock pursuant to the exercise of a Right shall initially be
Forty-Five Dollars ($45.00), shall be subject to adjustment from time to time as
provided in Section 11 and Section 13 hereof and shall be payable in lawful
money of the United States of America in accordance with Section 7(c) below.
(c) As promptly as practicable following the Distribution Date, the
Company shall deposit with a corporation, trust, bank or similar institution in
good standing organized under the laws of the United States or any State of the
United States, which is authorized under such laws to exercise corporate trust
or stock transfer powers and is subject to supervision or examination by a
federal or state authority (such institution is hereinafter referred to as the
"DEPOSITARY AGENT"), certificates representing the shares of Preferred Stock
that may be acquired upon exercise of the Rights and the Company shall cause
such Depositary Agent to enter into an agreement pursuant to which the
Depositary Agent shall issue receipts representing interests in the shares of
Preferred Stock so deposited. Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase and the certificate on
the reverse side thereof duly executed, accompanied by payment of the Exercise
Price for the shares to be purchased and an amount equal to any applicable
transfer tax (as determined by the Rights Agent) in cash, or by certified check
or bank draft payable to the order of the Company, the Rights Agent shall,
subject to Section 20(k) hereof, thereupon promptly (i) requisition from the
Depositary Agent (or make available, if the Rights Agent is the Depositary
Agent) depositary receipts or certificates for the number of one one-thousandth
of a share of Preferred Stock to be
- 11 -
purchased and the Company hereby irrevocably authorizes the Depositary Agent to
comply with all such requests, (ii) when appropriate, requisition from the
Company the amount of cash, if any, to be paid in lieu of issuance of fractional
shares in accordance with Section 14 hereof, (iii) promptly after receipt of
such certificates or depositary receipts, cause the same to be delivered to or
upon the order of the registered holder of such Right Certificate, registered in
such name or names as may be designated by such holder, and (iv) when
appropriate, after receipt promptly deliver such cash to or upon the order of
the registered holder of such Right Certificate. In the event that the Company
is obligated to issue other securities (including Common Stock) of the Company,
pay cash or distribute other property pursuant to Section 11(a) hereof, the
Company will make all arrangements necessary so that such other securities, cash
or other property are available for distribution by the Rights Agent, if and
when appropriate. The payment of the Exercise Price may be made in cash or by
certified or bank check payable to the order of the Company, or by wire transfer
of immediately available funds to the account of the Company (provided that
notice of such wire transfer shall be given by the holder of the related Right
to the Rights Agent).
(d) In case the registered holder of any Right Certificate shall exercise
less than all the Rights evidenced thereby, a new Right Certificate evidencing
Rights equivalent to the Rights remaining unexercised shall be issued by the
Rights Agent and delivered to the registered holder of such Right Certificate or
to his duly authorized assigns, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the contrary, from and
after the first occurrence of a Section 11(a)(ii) Event or Section 13 Event, any
Rights beneficially owned by (i) an Acquiring Person, an Adverse Person or any
Associate or Affiliate of an Acquiring Person or an Adverse Person, (ii) a
transferee of an Acquiring Person or an Adverse Person (or of any Associate or
Affiliate of an Acquiring Person or an Adverse Person) who becomes a transferee
after the Acquiring Person or Adverse Person becomes such, or (iii) a transferee
of an Acquiring Person or an Adverse Person (or of any Associate or Affiliate of
an Acquiring Person or an Adverse Person) who becomes a transferee prior to or
concurrently with the Acquiring Person or Adverse Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person or Adverse Person to holders of equity
interests in such Acquiring Person or Adverse Person or to any Person with whom
the Acquiring Person or Adverse Person has any continuing agreement, arrangement
or understanding regarding the transferred Rights, the shares of Common Stock of
the Company associated with such Rights or the Company, or (B) a transfer which
the Board of Directors has determined is part of a plan, arrangement or
understanding which has as a primary purpose or effect the avoidance of this
Section 7(e), shall be null and void without any further action and no holder of
such Rights shall have any rights whatsoever with respect to such Rights,
whether under any provision of this Agreement or otherwise. The Company shall
use all reasonable efforts to ensure that the provisions of this Section 7(e)
and Section 4(b) hereof are complied with, but shall have no liability to any
holder of Right Certificates or other Person as a result of its failure to make
any determinations with respect to an Acquiring Person or Adverse Person or any
Affiliates or Associates of an Acquiring Person or an Adverse Person or any
transferee of any of them hereunder.
- 12 -
(f) Notwithstanding anything in this Agreement to the contrary, neither
the Rights Agent nor the Company shall be obligated to undertake any action with
respect to a registered holder of Rights upon the occurrence of any purported
exercise as set forth in this Section 7 unless such registered holder shall have
(i) completed and signed the certificate contained in the form of election to
purchase set forth on the reverse side of the Right Certificate surrendered for
such exercise, and (ii) provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company shall reasonably request.
SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHT CERTIFICATES. All Right
Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered to the Rights Agent, shall be canceled by it, and no Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Agreement. The Company shall deliver to the Rights
Agent for cancellation and retirement, and the Rights Agent shall so cancel and
retire, any other Right Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall deliver all
canceled Right Certificates to the Company.
SECTION 9. RESERVATION AND AVAILABILITY OF PREFERRED STOCK.
(a) The Company covenants and agrees that it will cause to be reserved
and kept available out of its authorized and unissued shares of Preferred
Stock or any authorized and issued shares of Preferred Stock held in its
treasury, the number of shares of Preferred Stock that will be sufficient to
permit the exercise in full of all outstanding and exercisable Rights. Upon
the occurrence of any events resulting in an increase in the aggregate number
of shares of Preferred Stock issuable upon exercise of all outstanding Rights
in excess of the number then reserved, the Company shall make appropriate
increases in the number of shares so reserved.
(b) The Company shall use its best efforts to cause, from and after such
time as the Rights become exercisable, all shares of Preferred Stock issued or
reserved for issuance to be listed, upon official notice of issuance, upon the
principal national securities exchange, if any, upon which the Common Stock of
the Company is listed or, if the principal market for the Common Stock of the
Company is not on any national securities exchange, to be eligible for quotation
on the National Association of Securities Dealers Automated Quotation System
("NASDAQ") or any successor thereto or other comparable quotation system.
(c) The Company shall use its best efforts to (i) file, as soon as
practicable following the earliest date after the occurrence of a Section
11(a)(ii) Event on which the consideration to be delivered by the Company upon
exercise of the Rights has been determined in accordance with Section 11(a)(iii)
hereof, or as soon as required by law following the Distribution Date, as the
case may be, a registration statement under the Securities Act of 1933, as
amended (the "SECURITIES ACT"), with respect to the securities purchasable upon
exercise of the Rights on an appropriate form, (ii) cause such registration
statement to become effective as soon as practicable after such filing, and
(iii) cause such registration statement to remain effective (with a prospectus
that at all times meets the requirements of the Securities Act) until the
earlier of (A) the date as of which the Rights are no longer exercisable for
such securities or
- 13 -
(B) the Expiration Date. The Company will also take such action as may be
appropriate under, and which will ensure compliance with, the securities or
"blue sky" laws of the various states in connection with the exercisability of
the Rights. The Company may temporarily suspend, for a period of time not to
exceed ninety (90) days after the date determined in accordance with the
provisions of the first sentence of this Section 9(c), the exercisability of the
Rights in order to prepare and file such registration statement and permit it to
become effective. Upon such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the suspension is no
longer in effect, in each case with prompt written notice to the Rights Agent.
Notwithstanding any such provision of this Agreement to the contrary, the Rights
shall not be exercisable in any jurisdiction unless the requisite qualification
in such jurisdiction shall have been obtained.
(d) The Company covenants and agrees that it will take all such action as
may be necessary to ensure that all shares of Preferred Stock delivered upon the
exercise of the Rights shall, at the time of delivery of the certificates or
depositary receipts for such shares (subject to payment of the Exercise Price),
be duly and validly authorized and issued and fully paid and nonassessable.
(e) The Company further covenants and agrees that it will pay when due
and payable any and all federal and state transfer taxes and charges which may
be payable in respect of the issuance or delivery of the Right Certificates or
of any certificates for shares of Preferred Stock upon the exercise of Rights.
The Company shall not, however, be required to pay any transfer tax which may be
payable in respect of any transfer or delivery of Right Certificates to a Person
other than, or in respect of the issuance or delivery of securities in a name
other than that of, the registered holder of the Right Certificates evidencing
Rights surrendered for exercise or to issue or deliver any certificates for
securities in a name other than that of the registered holder upon the exercise
of any Rights until such tax shall have been paid (any such tax being payable by
the holder of such Right Certificate at the time of surrender) or until it has
been established to the Company's satisfaction that no such tax is due.
SECTION 10. PREFERRED STOCK RECORD DATE. Each Person in whose name any
certificate for Preferred Stock (including any fraction of a share 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 such certificate shall be dated, the date upon which the Right
Certificate evidencing such Rights was duly surrendered and payment of the
Exercise Price (and any applicable transfer taxes) was made; provided, however,
that if the date of such surrender and payment is a date upon which the
Preferred Stock transfer books of the Company are closed, such person shall be
deemed to have become the record holder of such shares on, and such certificate
shall be dated, the next succeeding Business Day on which the Preferred Stock
transfer books of the Company are open; and further provided, however, that if
delivery of shares of Preferred Stock is delayed pursuant to Section 9(c), such
Person shall be deemed to have become the record holder of such shares of
Preferred Stock only when such shares first become deliverable. Prior to the
exercise of the Right evidenced thereby, the holder of a Right Certificate shall
not be entitled to any rights of a shareholder of the Company with respect to
shares for which the Rights shall be exercisable, including, without limitation,
the right to vote, to receive dividends or other distributions or to exercise
any preemptive rights, and shall
- 14 -
not be entitled to receive any notice of any proceedings of the Company, except
as provided herein.
SECTION 11. ADJUSTMENT OF EXERCISE PRICE, NUMBER AND KIND OF SHARES OR
NUMBER OF RIGHTS. The Exercise Price, the number and kind of shares covered by
each Right and the number of Rights outstanding are subject to adjustment from
time to time as provided in this Section 11.
(a) (i) In the event the Company shall at any time after the date of
this Agreement (A) declare a dividend on the Preferred Stock payable in
shares of Preferred Stock, (B) subdivide the outstanding Preferred Stock,
(C) combine the outstanding Preferred Stock into a smaller number of
shares, or (D) issue any shares of its capital stock in a reclassification
of the Preferred Stock (including any such reclassification in connection
with a consolidation or merger in which the Company is the continuing or
surviving corporation), except as otherwise provided in this Section 11(a)
and Section 7(e) hereof, the Exercise Price in effect at the time of the
record date for such dividend or of the effective date of such subdivision,
combination or reclassification, and the number and kind of shares of
capital stock issuable on such date, shall be proportionately adjusted so
that the holder of any Right exercised after such time shall be entitled to
receive the aggregate number and kind of shares of capital stock which, if
such Right had been exercised immediately prior to such date and at a time
when the Preferred Stock transfer books of the Company were open, such
holder would have owned upon such exercise and been entitled to receive by
virtue of such dividend, subdivision, combination or reclassification;
provided, however, that in no event shall the consideration to be paid upon
the exercise of a Right be less than the aggregate par value of the shares
of capital stock of the Company issuable upon exercise of a Right. If an
event occurs which would require an adjustment under both Section 11(a)(i)
and Section 11(a)(ii) hereof, the adjustment provided for in this Section
11(a)(i) shall be in addition to, and shall be made prior to, any
adjustment required pursuant to Section 11(a)(ii) hereof.
(ii) Subject to the provisions of Section 24 hereof, in the event
(A) any Person, alone or together with its Affiliates and
Associates, shall become an Acquiring Person, or
(B) the Board of Directors, by majority vote, shall declare
any Person to be an Adverse Person, after (x) a determination
that such Person, alone or together with its Affiliates and
Associates, has become the Beneficial Owner of 10% or more of the
outstanding shares of Common Stock of the Company and (y) a
determination by the Board of Directors, after reasonable inquiry
and investigation, including such consultation, if any, with such
persons as such directors shall deem appropriate, that (a) such
Beneficial Ownership by such Person is intended to cause, is
reasonably likely to cause or will cause the Company to
repurchase the Common Stock of the Company beneficially owned by
such Person or to cause pressure on the Company to take action or
enter into a transaction or series of transactions which would
provide such Person with short-term financial gain under
circumstances where the Board of Directors determines
- 15 -
that the best long-term interests of the Company and its
shareholders, but for the actions and possible actions of such
Person, would not be served by taking such action or entering
into such transactions or series of transactions at that time, or
(b) such Beneficial Ownership is causing or reasonably likely to
cause a material adverse impact (including, but not limited to,
impairment of relationships with customers or impairment of the
Company's ability to maintain its competitive position) on the
business or prospects of the Company. No delay or failure by the
Board of Directors to declare a Person to be an Adverse Person
shall in any way waive or otherwise affect the power of the Board
of Directors subsequently to declare a Person to be an Adverse
Person. In the event that the Board of Directors should at any
time determine, upon reasonable inquiry and investigation,
including consultation with such Persons as the Board of
Directors shall deem appropriate, that such Person has not met or
complied with any condition specified by the Board of Directors,
the Board of Directors may at any time thereafter declare such
Person to be an Adverse Person pursuant to the provisions of this
Section 11(a)(ii)(B),
then, and in each such case, promptly following any such
occurrence, proper provision shall be made so that each holder of
a Right, except as provided in Section 7(e) hereof, shall
thereafter have a right to receive, upon exercise thereof at the
then current Exercise Price in accordance with the terms of this
Agreement, such number of shares of Preferred Stock of the
Company as shall equal the result obtained by (x) multiplying the
then current Exercise Price by the then number of one
one-thousandth of a share of Preferred Stock for which a Right
was exercisable immediately prior to the first occurrence of a
Section 11(a)(ii) Event, whether or not such Right was then
exercisable, and dividing that product by (y) 50% of the Fair
Market Value per one one-thousandth of a share of the Preferred
Stock (determined pursuant to Section 11(d)) on the date of the
occurrence of a Section 11(a)(ii) Event (such number of shares
being referred to as the "ADJUSTMENT SHARES").
(iii) In lieu of issuing any shares of Preferred Stock in
accordance with Section 11(a)(ii) hereof, the Company, acting by or
pursuant to resolution of the Board of Directors, may, and in the
event that the number of shares of Preferred Stock which are
authorized by the Company's Articles of Organization but not
outstanding or reserved for issuance for purposes other than upon
exercise of the Rights is not sufficient to permit the exercise in
full of the Rights in accordance with the foregoing subparagraph (ii)
of this Section 11(a), the Company, acting by or pursuant to
resolution of the Board of Directors, shall: (A) determine the excess
of (X) the Fair Market Value of the Adjustment Shares issuable upon
the exercise of a Right (the "CURRENT VALUE") over (Y) the Exercise
Price attributable to each Right (such excess being referred to as the
"SPREAD") and (B) with respect to all or a portion of each Right
(subject to Section 7(e) hereof), make adequate provision to
substitute for the Adjustment Shares, upon payment of the applicable
Exercise Price, (1) cash, (2) a reduction in the Exercise Price, (3)
Preferred Stock Equivalents which the Board of Directors has deemed to
have the same value as shares of Common Stock of the Company, (4) debt
securities of the Company, (5) other assets of the Company, or (6) any
combination of the foregoing which, when added to any shares
- 16 -
of Preferred Stock issued upon such exercise, has an aggregate value
equal to the Current Value, where such aggregate value has been
determined by the Board of Directors based upon the advice of a
nationally recognized investment banking firm selected by the Board of
Directors; provided, however, that if the Company shall not have made
adequate provision to deliver value pursuant to clause (B) above
within thirty (30) days following the later of (x) the first
occurrence of a Section 11(a)(ii) Event and (y) the date on which the
Company's right of redemption pursuant to Section 23(a) expires (the
later of (x) and (y) being referred to herein as the "SECTION
11(a)(ii) TRIGGER DATE"), then the Company shall be obligated to
deliver, upon the surrender for exercise of a Right and without
requiring payment of the Exercise Price, shares of Preferred Stock (to
the extent available) and then, if necessary, cash, which shares
and/or cash have an aggregate value equal to the Spread. If the Board
of Directors shall determine in good faith that it is likely that
sufficient additional shares of Preferred Stock could be authorized
for issuance upon exercise in full of the Rights, the 30-day period
set forth above may be extended to the extent necessary, but not more
than ninety (90) days after the Section 11(a)(ii) Trigger Date, in
order that the Company may seek stockholder approval for the
authorization of such additional shares (such period, as it may be
extended, being referred to herein as the "SUBSTITUTION PERIOD"). To
the extent that the Company determines that some action needs to be
taken pursuant to the first and/or second sentences of this Section
11(a)(iii), the Company (x) shall provide, subject to Section 7(e)
hereof, that such action shall apply uniformly to all outstanding
Rights and (y) may suspend the exercisability of the Rights until the
expiration of the Substitution Period in order to seek any
authorization of additional shares and/or to decide the appropriate
form of distribution to be made pursuant to such first sentence and to
determine the value thereof. In the event of any such suspension, the
Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended and a
public announcement at such time as the suspension is no longer in
effect. For purposes of this Section 11(a)(iii), the value of the
Preferred Stock shall be the Fair Market Value (as determined pursuant
to Section 11(d) hereof) per share of the Preferred Stock on the
Section 11(a)(ii) Trigger Date and the value of any Preferred Stock
Equivalent shall be deemed to have the same value as the Preferred
Stock on such date.
(b) If the Company shall fix a record date for the issuance of rights,
options or warrants to all holders of Preferred Stock entitling them (for a
period expiring within forty-five (45) calendar days after such record date) to
subscribe for or purchase Preferred Stock (or securities having the same or more
favorable rights, privileges and preferences as the shares of Preferred Stock
("PREFERRED STOCK EQUIVALENTS")) or securities convertible into Preferred Stock
or Preferred Stock Equivalents at a price per share of Preferred Stock or per
share of Preferred Stock Equivalents (or having a conversion price per share, if
a security convertible into Preferred Stock or Preferred Stock Equivalents) less
than the Fair Market Value (as determined pursuant to Section 11(d) hereof) per
share of Preferred Stock on such record date, the Exercise Price to be in effect
after such record date shall be determined by multiplying the Exercise Price in
effect immediately prior to such record date by a fraction, the numerator of
which shall be the number of shares of Preferred Stock outstanding on such
record date, plus the number of shares of Preferred Stock which the aggregate
offering price of the total number of shares of Preferred Stock and/or Preferred
Stock Equivalents to be offered (and the aggregate initial conversion price of
the convertible securities so to be offered) would purchase at such Fair Market
Value and the
- 17 -
denominator of which shall be the number of shares of Preferred Stock
outstanding on such record date, plus the number of additional shares of
Preferred Stock and Preferred Stock Equivalents to be offered for subscription
or purchase (or into which the convertible securities so to be offered are
initially convertible); provided, however, that in no event shall the
consideration to be paid upon the exercise of a Right be less than the aggregate
par value of the shares of capital stock of the Company issuable upon exercise
of a Right. In case such subscription price may be paid in a consideration part
or all of which shall be in a form other than cash, the value of such
consideration shall be the Fair Market Value thereof determined in accordance
with Section 11(d) hereof. Shares of Preferred Stock owned by or held for the
account of the Company shall not be deemed outstanding for the purpose of any
such computation. Such adjustments shall be made successively whenever such a
record date is fixed; and in the event that such rights or warrants are not so
issued, the Exercise Price shall be adjusted to be the Exercise Price which
would then be in effect if such record date had not been fixed.
(c) If the Company shall fix a record date for the making of a
distribution to all holders of Preferred Stock (including any such distribution
made in connection with a consolidation or merger in which the Company is the
continuing or surviving corporation), of evidences of indebtedness, cash (other
than a regular periodic cash dividend out of the earnings or retained earnings
of the Company), assets (other than a dividend payable in Preferred Stock, but
including any dividend payable in stock other than Preferred Stock) or
convertible securities, subscription rights or warrants (excluding those
referred to in Section 11(b)), the Exercise Price to be in effect after such
record date shall be determined by multiplying the Exercise Price in effect
immediately prior to such record date by a fraction, the numerator of which
shall be the Fair Market Value (as determined pursuant to Section 11(d) hereof)
per one one-thousandth of a share of Preferred Stock on such record date, less
the Fair Market Value (as determined pursuant to Section 11(d) hereof) of the
portion of the cash, assets or evidences of indebtedness so to be distributed or
of such convertible securities, subscription rights or warrants applicable to
one one-thousandth of a share of Preferred Stock and the denominator of which
shall be the Fair Market Value (as determined pursuant to Section 11(d) hereof)
per one one-thousandth of a share of Preferred Stock; provided, however, that in
no event shall the consideration to be paid upon the exercise of a Right be less
than the aggregate par value of the shares of capital stock of the Company
issuable upon exercise of a Right. Such adjustments shall be made successively
whenever such a record date is fixed; and in the event that such distribution is
not so made, the Exercise Price shall again be adjusted to be the Exercise Price
which would be in effect if such record date had not been fixed.
(d) For the purpose of this Agreement, the "FAIR MARKET VALUE" of any
share of Preferred Stock, Common Stock or any other stock or any Right or other
security or any other property shall be determined as provided in this Section
11(d).
(i) In the case of a publicly-traded stock or other security, the Fair
Market Value on any date shall be deemed to be the average of the daily
closing prices per share of such stock or per unit of such other security
for the 30 consecutive Trading Days (as such term is hereinafter defined)
immediately prior to such date; provided, however, that in the event that
the Fair Market Value per share of any share of stock is determined during
a period following the announcement by the issuer of such stock of (x) a
dividend or distribution on such stock payable in shares of such stock or
securities
- 18 -
convertible into shares of such stock or (y) any subdivision, combination
or reclassification of such stock, and prior to the expiration of the 30
Trading Day period after the ex-dividend date for such dividend or
distribution, or the record date for such subdivision, combination or
reclassification, then, and in each such case, the Fair Market Value shall
be properly adjusted to take into account ex-dividend trading. The closing
price for each day shall be the last sale price, regular way, or, in case
no such sale takes place on such day, the average of the closing bid and
asked prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed
or admitted to trading on the New York Stock Exchange or, if the securities
are not listed or admitted to trading on the New York Stock Exchange, as
reported in the principal consolidated transaction reporting system with
respect to securities listed on the principal national securities exchange
on which such security is listed or admitted to trading; or, if not listed
or admitted to trading on any national securities exchange, the last quoted
price (or, if not so quoted, the average of the last quoted high bid and
low asked prices) in the over-the-counter market, as reported by Nasdaq or
such other system then in use; or, if on any such date no bids for such
security are quoted by any such organization, the average of the closing
bid and asked prices as furnished by a professional market maker making a
market in such security selected by the Board of Directors. If on any such
date no market maker is making a market in such security, the Fair Market
Value of such security on such date shall be determined reasonably and with
utmost good faith to the holders of the Rights by the Board of Directors,
provided, however, that if at the time of such determination there is an
Acquiring Person or an Adverse Person, the Fair Market Value of such
security on such date shall be determined by a nationally recognized
investment banking firm selected by the Board of Directors, which
determination shall be described in a statement filed with the Rights Agent
and shall be binding on the Rights Agent and the holders of the Rights. The
term "TRADING DAY" shall mean a day on which the principal national
securities exchange on which such security is listed or admitted to trading
is open for the transaction of business or, if such security is not listed
or admitted to trading on any national securities exchange, a Business Day.
(ii) If a security is not publicly held or not so listed or traded,
"FAIR MARKET VALUE" shall mean the fair value per share of stock or per
other unit of such security, determined reasonably and with utmost good
faith to the holders of the Rights by the Board of Directors; provided,
however, that if at the time of such determination there is an Acquiring
Person or an Adverse Person, the Fair Market Value of such security on such
date shall be determined by a nationally recognized investment banking firm
selected by the Board of Directors, which determination shall be described
in a statement filed with the Rights Agent and shall be binding on the
Rights Agent and the holders of the Rights; provided, however, that for the
purposes of making any adjustment provided for by Section 11(a)(ii) hereof,
the Fair Market Value of a share of Preferred Stock shall not be less than
the product of the then Fair Market Value of a share of Common Stock
multiplied by the higher of the then Dividend Multiple or Vote Multiple (as
both of such terms are defined in the Certificate of Vote of Directors
Establishing a Series of a Class of Stock attached as EXHIBIT A hereto)
applicable to the Preferred Stock and shall not exceed 105% of the product
of the then Fair Market Value of a share of
- 19 -
Common Stock multiplied by the higher of the then Dividend Multiple or Vote
Multiple applicable to the Preferred Stock.
(iii) In the case of property other than securities, the Fair Market
Value thereof shall be determined reasonably and with utmost good faith to
the holders of Rights by the Board of Directors; provided, however, that if
at the time of such determination there is an Acquiring Person or an
Adverse Person, the Fair Market Value of such property on such date shall
be determined by a nationally recognized investment banking firm selected
by the Board of Directors, which determination shall be described in a
statement filed with the Rights Agent and shall be binding upon the Rights
Agent and the holders of the Rights.
(e) Anything herein to the contrary notwithstanding, no adjustment in the
Exercise Price shall be required unless such adjustment would require an
increase or decrease of at least 1% in the Exercise Price; provided, however,
that any adjustments which by reason of this Section 11(e) are not required to
be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made to the nearest
cent or to the nearest one-millionth of a share of Common Stock of the Company
or hundred-millionth of a share of Preferred Stock, as the case may be, or to
such other figure as the Board of Directors may deem appropriate.
Notwithstanding the first sentence of this Section 11(e), any adjustment
required by this Section 11 shall be made no later than the earlier of (i) three
(3) years from the date of the transaction which mandates such adjustment or
(ii) the Expiration Date.
(f) If as a result of any provision of Section 11(a) or Section 13(a)
hereof, the holder of any Right thereafter exercised shall become entitled to
receive any shares of capital stock of the Company other than Preferred Stock,
thereafter the number of such other shares so receivable upon exercise of any
Right shall be subject to adjustment from time to time in a manner and on terms
as nearly equivalent as practicable to the provisions with respect to the
Preferred Stock contained in Section 11(a), (b), (c), (d), (e), (g) through (k)
and (m), inclusive, and the provisions of Sections 7, 9, 10, 13 and 14 hereof
with respect to the Preferred Stock shall apply on like terms to any such other
shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Exercise Price hereunder shall evidence the right to
purchase, at the adjusted Exercise Price, the number of one one-thousandth of a
share of Preferred Stock (or other securities or amount of cash or combination
thereof) purchasable from time to time hereunder upon exercise of the Rights,
all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as provided in
Section 11(i), upon each adjustment of the Exercise Price as a result of the
calculations made in Section 11(b) and (c), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Exercise Price, that number of one one-thousandth of a
share of Preferred Stock (calculated to the nearest one hundred-millionth) as
the Board of Directors reasonably determines is appropriate to preserve economic
value of the Rights, including, by way of example, that number obtained by (i)
multiplying (x) the number of one one-thousandth of a share of Preferred Stock
for which a Right may be exercisable immediately prior to this adjustment by (y)
the Exercise Price in effect
- 20 -
immediately prior to such adjustment of the Exercise Price and (ii) dividing the
product so obtained by the Exercise Price in effect immediately after such
adjustment of the Exercise Price.
(i) The Company may elect on or after the date of any adjustment of the
Exercise Price to adjust the number of Rights, in substitution for any
adjustment in the number of shares of Preferred Stock purchasable upon the
exercise of a Right. Each of the Rights outstanding after the adjustment in the
number of Rights shall be exercisable for the number of one one-thousandth 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 Exercise Price in effect immediately
prior to adjustment of the Exercise Price by the Exercise Price in effect
immediately after adjustment of the Exercise Price. The Company shall make a
public announcement of its election to adjust the number of Rights, indicating
the record date for the adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which the Exercise
Price is adjusted or any day thereafter, but, if the Right Certificates have
been issued, shall be at least ten (10) days later than the date of the public
announcement. If Right Certificates have been issued, upon each adjustment of
the number of Rights pursuant to this Section 11(i), the Company shall, as
promptly as practicable, cause to be distributed to holders of record of Right
Certificates on such record date Right Certificates evidencing, subject to
Section 14 hereof, the additional Rights to which such holders shall be entitled
as a result of such adjustment, or, at the option of the Company, shall cause to
be distributed to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment. Right Certificates so to be distributed shall be issued, executed
and countersigned in the manner provided for herein (and may bear, at the option
of the Company, the adjusted Exercise Price) and shall be registered in the
names of the holders of record of Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the Exercise Price or the
number of one one-thousandth of a share of Preferred Stock issuable upon the
exercise of the Rights, the Right Certificates theretofore and thereafter issued
may continue to express the Exercise Price per share and the number of shares
which were expressed in the initial Right Certificates issued hereunder without
prejudice to any adjustment or change.
(k) Before taking any action that would cause an adjustment reducing the
Exercise Price below the then stated value, if any, of the number of one
one-thousandth of a share of Preferred Stock issuable upon exercise of the
Rights, the Company shall take any corporate action which may, in the opinion of
its counsel, be necessary in order that the Company may validly and legally
issue fully paid and nonassessable shares of Preferred Stock at such adjusted
Exercise Price.
(l) In any case in which this Section 11 shall require that an adjustment
in the Exercise Price be made effective as of a record date for a specified
event, the Company may elect to defer until the occurrence of such event the
issuing to the holder of any Right exercised after such record date the number
of one one-thousandth of a share of Preferred Stock or other capital stock or
securities of the Company, if any, issuable upon such exercise over and above
the
- 21 -
number of one one-thousandth of a share of Preferred Stock and other capital
stock or securities of the Company, if any, issuable upon such exercise on the
basis of the Exercise Price in effect prior to such adjustment; provided,
however, that the Company shall deliver to such holder a due ▇▇▇▇ or other
appropriate instrument evidencing such holder's right to receive such additional
shares upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the Exercise Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that in their good faith judgment a majority of the Board of
Directors shall determine to be advisable in order that any consolidation or
subdivision of the Preferred Stock, issuance wholly for cash of any shares of
Preferred Stock at less than the Fair Market Value, issuance wholly for cash of
shares of Preferred Stock or securities which by their terms are convertible
into or exchangeable for shares of Preferred Stock, stock dividends or issuance
of rights, options or warrants referred to hereinabove in this Section 11,
hereafter made by the Company to holders of its Preferred Stock, shall not be
taxable to such shareholders.
(n) The Company covenants and agrees that it shall not, at any time after
the Distribution Date and so long as the Rights have not been redeemed pursuant
to Section 23 hereof or exchanged pursuant to Section 24 hereof, (i) consolidate
with (other than a Subsidiary of the Company in a transaction that complies with
the proviso at the end of this sentence), (ii) merge with or into, or (iii) sell
or transfer (or permit any Subsidiary to sell or transfer), in one transaction
or a series of related transactions, assets or earning power aggregating 50% or
more of the assets or earning power of the Company and its Subsidiaries taken as
a whole, to any other Person or Persons (other than the Company and/or any of
its Subsidiaries in one or more transactions each of which complies with the
proviso at the end of this sentence) if (x) at the time of or immediately after
such consolidation, merger or sale there are any rights, warrants or other
instruments outstanding or agreements or arrangements in effect which would
substantially diminish or otherwise eliminate the benefits intended to be
afforded by the Rights, or (y) prior to, simultaneously with or immediately
after such consolidation, merger or sale the shareholders of a Person who
constitutes, or would constitute, the "PRINCIPAL PARTY" for the purposes of
Section 13(a) hereof shall have received a distribution of Rights previously
owned by such Person or any of its Affiliates and Associates; provided, however,
that this Section 11(n) shall not affect the ability of any Subsidiary of the
Company to consolidate with, or merge with or into, or sell or transfer assets
or earning power to, any other Subsidiary of the Company. The Company further
covenants and agrees that after the Distribution Date it will not, except as
permitted by Section 23 or Section 27 hereof, take (or permit any Subsidiary to
take) any action if at the time such action is taken it is reasonably
foreseeable that such action will substantially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights.
(o) Notwithstanding anything in this Agreement to the contrary, in the
event the Company shall at any time after the date of this Agreement and prior
to the Distribution Date (i) declare or pay any dividend on the outstanding
Common Stock of the Company payable in shares of Common Stock of the Company or
(ii) effect a subdivision, combination or consolidation of the outstanding
shares of Common Stock of the Company (by reclassification or otherwise than by
payment of dividends in shares of Common Stock of the Company) into a greater or
lesser number of shares of Common Stock of the Company, then in any such case
(A)
- 22 -
the number of one one-thousandth of a share of Preferred Stock purchasable
after such event upon proper exercise of each Right shall be determined by
multiplying the number of one one-thousandth of a share of Preferred Stock so
purchasable immediately prior to such event by a fraction, the numerator of
which is the number of shares of Common Stock of the Company outstanding
immediately prior to such event and the denominator of which is the number of
shares of Common Stock of the Company outstanding immediately after such event,
and (B) each share of Common Stock of the Company outstanding immediately after
such event shall have issued with respect to it that number of Rights which each
share of Common Stock of the Company outstanding immediately prior to such event
had issued with respect to it. The adjustments provided for in this Section
11(o) shall be made successively whenever such a dividend is declared or paid or
such a subdivision, combination or consolidation is effected.
(p) The exercise of Rights under Section 11(a)(ii) shall only result in
the loss of rights under Section 11(a)(ii) to the extent so exercised and shall
not otherwise affect the rights of holders of Right Certificates under this
Rights Agreement, including rights to purchase securities of the Principal Party
following a Section 13 Event which has occurred or may thereafter occur, as set
forth in Section 13 hereof. Upon exercise of a Right Certificate under Section
11(a)(ii), the Rights Agent shall return such Right Certificate duly marked to
indicate that such exercise has occurred.
SECTION 12. CERTIFICATE OF ADJUSTED EXERCISE PRICE OR NUMBER OF SHARES.
Whenever an adjustment is made as provided in Section 11 or Section 13 hereof,
the Company shall (a) promptly prepare a certificate setting forth such
adjustment and a brief statement of the facts accounting for such adjustment,
(b) promptly file with the Rights Agent and with each transfer agent for the
Preferred Stock and the Common Stock of the Company a copy of such certificate,
and (c) mail a brief summary thereof to each holder of a Right Certificate in
accordance with Section 26 hereof. The Rights Agent shall be fully protected in
relying on any such certificate and on any adjustment contained therein and
shall not be deemed to have knowledge of any such adjustment unless and until it
shall have received such certificate.
SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR
EARNING POWER.
(a) In the event that, following the Stock Acquisition Date, directly or
indirectly, (x) the Company shall consolidate with, or merge with and into, any
other Person (other than a Subsidiary of the Company in a transaction which is
not prohibited by Section 11(n) hereof), and the Company shall not be the
continuing or surviving corporation of such consolidation or merger, (y) any
Person (other than a Subsidiary of the Company in a transaction which is not
prohibited by the proviso at the end of the first sentence of Section 11(n)
hereof) shall consolidate with the Company, or merge with and into the Company
and the Company shall be the continuing or surviving corporation of such merger
and, in connection with such merger, all or part of the shares of Common Stock
of the Company shall be changed into or exchanged for stock or other securities
of any other Person or cash or any other property, or (z) the Company shall
sell, mortgage or otherwise transfer (or one or more of its Subsidiaries shall
sell, mortgage or otherwise transfer), in one transaction or a series of related
transactions, assets or earning power aggregating 50% or more of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to any
other Person or Persons (other than the Company or any Subsidiary of the Company
in one or more transactions, each of which is not prohibited by the
- 23 -
proviso at the end of the first sentence of Section 11(n) hereof), then, and in
each such case, proper provision shall be made so that: (i) each holder of a
Right, except as provided in Section 7(e) hereof, shall have the right to
receive, upon the exercise thereof at the then current Exercise Price in
accordance with the terms of this Agreement, such number of validly authorized
and issued, fully paid and nonassessable shares of freely tradeable Common Stock
of the Principal Party (as hereinafter defined in Section 13(b)), free and clear
of rights of call or first refusal, liens, encumbrances, transfer restrictions
or other adverse claims, as shall be equal to the result obtained by (1)
multiplying the then current Exercise Price by the number of one one-thousandth
of a share of Preferred Stock for which a Right is exercisable immediately prior
to the first occurrence of a Section 13 Event, and dividing that product by (2)
50% of the Fair Market Value (determined pursuant to Section 11(d) hereof) per
share of the Common Stock of such Principal Party on the date of consummation of
such consolidation, merger, sale or transfer; (ii) such Principal Party shall
thereafter be liable for, and shall assume, by virtue of such consolidation,
merger, sale, mortgage or transfer, all the obligations and duties of the
Company pursuant to this Agreement; (iii) the term "COMPANY" shall thereafter be
deemed to refer to such Principal Party, it being specifically intended that the
provisions of Section 11 hereof shall apply to such Principal Party; and (iv)
such Principal Party shall take such steps (including, but not limited to, the
reservation of a sufficient number of shares of its Common Stock to permit
exercise of all outstanding Rights in accordance with this Section 13(a) and the
making of payments in cash and/or other securities in accordance with Section
11(a)(iii) hereof) in connection with such consummation as may be necessary to
assure that the provisions hereof shall thereafter be applicable, as nearly as
reasonably may be, in relation to its shares of Common Stock thereafter
deliverable upon the exercise of the Rights.
(b) "PRINCIPAL PARTY" shall mean
(i) in the case of any transaction described in clause (x) or (y) of
the first sentence of Section 13(a), the Person that is the issuer of any
securities into which shares of Common Stock of the Company are converted
in such merger or consolidation, or, if there is more than one such issuer,
the issuer of Common Stock that has the highest aggregate Fair Market Value
(determined pursuant to Section 11(d)), and if no securities are so issued,
the Person that is the other party to the merger or consolidation, or, if
there is more than one such Person, the Person the Common Stock of which
has the highest aggregate Fair Market Value (determined pursuant to Section
11(d)); and
(ii) in the case of any transaction described in clause (z) of the
first sentence of Section 13(a), the Person that is the party receiving the
greatest portion of the assets or earning power transferred pursuant to
such transaction or transactions, or, if each Person that is a party to
such transaction or transactions receives the same portion of the assets or
earning power transferred pursuant to such transaction or transactions or
if the Person receiving the largest portion of the assets or earning power
cannot be determined, whichever Person the Common Stock of which has the
highest aggregate Fair Market Value (determined pursuant to Section 11(d));
provided, however, that in any such case, (1) if the Common Stock of such
Person is not at such time and has not been continuously over the preceding
12-month period registered under Section 12 of the Exchange Act
("REGISTERED COMMON STOCK") or such Person is not a corporation, and such
Person is a direct or indirect Subsidiary or Affiliate of another Person
which has Registered Common
- 24 -
Stock outstanding, "PRINCIPAL PARTY" shall refer to such other Person; (2)
if the Common Stock of such Person is not Registered Common Stock or such
Person is not a corporation, and such Person is a direct or indirect
Subsidiary of another Person but is not a direct or indirect Subsidiary of
another Person which has Registered Common Stock outstanding, "Principal
Party" shall refer to the ultimate parent entity of such first-mentioned
Person; (3) if the Common Stock of such Person is not Registered Common
Stock or such Person is not a corporation, and such Person is directly or
indirectly controlled by more than one Person, and one or more of such
other Persons has Registered Common Stock outstanding, "Principal Party"
shall refer to whichever of such other Persons is the issuer of the
Registered Common Stock having the highest aggregate Fair Market Value
(determined pursuant to Section 11(d)); and (4) if the Common Stock of such
Person is not Registered Common Stock or such Person is not a corporation,
and such Person is directly or indirectly controlled by more than one
Person, and none of such other Persons has Registered Common Stock
outstanding, "Principal Party" shall refer to whichever ultimate parent
entity is the corporation having the greatest stockholders' equity or, if
no such ultimate parent entity is a corporation, "Principal Party" shall
refer to whichever ultimate parent entity is the entity having the greatest
net assets.
(c) The Company shall not consummate any such consolidation, merger, sale
or transfer unless prior thereto (x) the Principal Party shall have a sufficient
number of authorized shares of its Common Stock, which have not been issued or
reserved for issuance, to permit the exercise in full of the Rights in
accordance with this Section 13, and (y) the Company and each Principal Party
and each other Person which may become a Principal Party as a result of such
consolidation, merger, sale or transfer shall have executed and delivered to the
Rights Agent a supplemental agreement providing for the terms set forth in
Section 13(a) and (b) and further providing that, as soon as practicable after
the date of any consolidation, merger, sale or transfer of assets mentioned in
Section 13(a), the Principal Party at its own expense will:
(i) prepare and file a registration statement under the Securities Act
with respect to the Rights and the securities purchasable upon exercise of
the Rights on an appropriate form, use its reasonable best efforts to cause
such registration statement to become effective as soon as practicable
after such filing and use its reasonable best efforts to cause such
registration statement to remain effective (with a prospectus that at all
times meets the requirements of the Securities Act) until the Expiration
Date;
(ii) use its reasonable best efforts to qualify or register the Rights
and the securities purchasable upon exercise of the Rights under the blue
sky laws of such jurisdictions as may be necessary or appropriate;
(iii) use its reasonable best efforts to list (or continue the listing
of) the Rights and the securities purchasable upon exercise of the Rights
on a national securities exchange or to meet the eligibility requirements
for quotation on Nasdaq; and
(iv) deliver to holders of the Rights historical financial statements
for the Principal Party and each of its Affiliates which comply in all
respects with the requirements for registration on Form 10 under the
Exchange Act.
- 25 -
(d) In case the Principal Party which is to be a party to a transaction
referred to in this Section 13 has a provision in any of its authorized
securities or in its Certificate of Incorporation or By-laws or other instrument
governing its affairs, which provision would have the effect of (i) causing such
Principal Party to issue (other than to holders of Rights pursuant to this
Section 13), in connection with, or as a consequence of, the consummation of a
transaction referred to in this Section 13, shares of Common Stock of such
Principal Party at less than the then current Fair Market Value (determined
pursuant to Section 11(d)) or securities exercisable for, or convertible into,
Common Stock of such Principal Party at less than such Fair Market Value, or
(ii) providing for any special payment, tax or similar provisions in connection
with the issuance of the Common Stock of such Principal Party pursuant to the
provisions of this Section 13, then, in such event, the Company shall not
consummate any such transaction unless prior thereto the Company and such
Principal Party shall have executed and delivered to the Rights Agent a
supplemental agreement providing that the provision in question of such
Principal Party shall have been canceled, waived or amended, or that the
authorized securities shall be redeemed, so that the applicable provision will
have no effect in connection with, or as a consequence of, the consummation of
the proposed transaction.
The provisions of this Section 13 shall similarly apply to successive
mergers or consolidations or sales or other transfers.
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES.
(a) The Company shall not be required to issue fractions of Rights,
except prior to the Distribution Date as provided in Section 11(o) hereof, or to
distribute Right Certificates which evidence fractional Rights. If the Company
elects not to issue such fractional Rights, the Company shall pay, in lieu of
such fractional Rights, to the registered holders of the Right Certificates with
regard to which such fractional Rights would otherwise be issuable, an amount in
cash equal to the same fraction of the Fair Market Value of a whole Right, as
determined pursuant to Section 11(d) hereof.
(b) The Company shall not be required to issue fractions of shares of
Preferred Stock (other than fractions which are integral multiples of one
one-thousandth of a share of Preferred Stock) upon exercise of the Rights or to
distribute certificates which evidence fractional shares of Preferred Stock
(other than fractions which are integral multiples of one one-thousandth of a
share of Preferred Stock). In lieu of fractional shares of Preferred Stock that
are not integral multiples of one one-thousandth of a share of Preferred Stock,
the Company may pay to the registered holders of Right Certificates at the time
such Rights are exercised as herein provided an amount in cash equal to the same
fraction of the Fair Market Value of one one-thousandth of a share of Preferred
Stock. For purposes of this Section 14(b), the Fair Market Value of one
one-thousandth of a share of Preferred Stock shall be determined pursuant to
Section 11(d) hereof for the Trading Day immediately prior to the date of such
exercise.
(c) The holder of a Right by the acceptance of the Rights expressly
waives his right to receive any fractional Rights or any fractional shares upon
exercise of a Right, except as permitted by this Section 14.
- 26 -
SECTION 15. RIGHTS OF ACTION. All rights of action in respect of this
Agreement, other than rights of action vested in the Rights Agent pursuant to
Sections 18 and 20 hereof, are vested in the respective registered holders of
the Right Certificates (or, prior to the Distribution Date, the registered
holders of the Common Stock of the Company); and any registered holder of any
Right Certificate (or, prior to the Distribution Date, of the Common Stock of
the Company), without the consent of the Rights Agent or of the holder of any
other Right Certificate (or, prior to the Distribution Date, of the Common Stock
of the Company), may, in such registered holder's own behalf and for such
registered holder's own benefit, enforce, and may institute and maintain any
suit, action or proceeding against the Company to enforce, or otherwise act in
respect of, his right to exercise the Right evidenced by such Right Certificate
in the manner provided in such Right Certificate and in this Agreement. Without
limiting the foregoing or any remedies available to the holders of Rights, it is
specifically acknowledged that the holders of Rights would not have an adequate
remedy at law for any breach of this Agreement and shall be entitled to specific
performance of the obligations hereunder and injunctive relief against actual or
threatened violations of the obligations hereunder of any Person subject to this
Agreement. Holders of Rights shall be entitled to recover the reasonable costs
and expenses, including attorneys' fees, incurred by them in any action to
enforce the provisions of this Agreement.
SECTION 16. AGREEMENT OF RIGHT HOLDERS. Every holder of a Right, by
accepting the same, consents and agrees with the Company and the Rights Agent
and with every other holder of a Right that:
(a) prior to the Distribution Date, each Right will be transferable only
simultaneously and together with the transfer of shares of Common Stock of the
Company;
(b) after the Distribution Date, the Right Certificates are transferable
only on the registry books of the Rights Agent if surrendered at the office or
offices of the Rights Agent designated for such purpose, duly endorsed or
accompanied by a proper instrument of transfer;
(c) subject to Sections 6(a) and 7(f), the Company and the Rights Agent
may deem and treat the person in whose name a Right Certificate (or, prior to
the Distribution Date, the associated certificate representing Common Stock of
the Company) is registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or writing on the
Right Certificates or the associated certificate representing Common Stock of
the Company made by anyone other than the Company or the Rights Agent) for all
purposes whatsoever, and, subject to the last sentence of Section 7(e), neither
the Company nor the Rights Agent shall be affected by any notice to the
contrary; and
(d) notwithstanding anything in this Agreement to the contrary, neither
the Company nor the Rights Agent shall have any liability to any holder of a
Right or other Person as the result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority prohibiting or otherwise restraining
performance of such obligations; provided, however, that the Company must use
its best efforts to have any such order, decree or ruling lifted or otherwise
overturned as soon as possible.
- 27 -
SECTION 17. RIGHT CERTIFICATE HOLDER NOT DEEMED A SHAREHOLDER. No holder, as
such, of any Right Certificate shall be entitled to vote, receive dividends or
be deemed for any purpose the holder of the shares of Preferred Stock or any
other securities of the Company which may at any time be issuable on the
exercise of the Rights represented thereby, nor shall anything contained herein
or in any Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a shareholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
shareholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
shareholders (except as provided in Section 25 hereof), or to receive dividends
or subscription rights, or otherwise, until the Right or Rights evidenced by
such Right Certificate shall have been exercised in accordance with the
provisions hereof.
SECTION 18. CONCERNING THE RIGHTS AGENT.
(a) The Company agrees to pay to the Rights Agent such compensation as
shall be agreed to in writing between the Company and the Rights Agent for all
services rendered by it hereunder and, from time to time, on demand of the
Rights Agent, its reasonable expenses and counsel fees and disbursements and
other disbursements incurred in the administration and execution of this
Agreement and the exercise and performance of its duties hereunder. The Company
also agrees to indemnify the Rights Agent for, and to hold it harmless against,
any loss, liability, or expense, incurred without gross negligence, bad faith or
willful misconduct on the part of the Rights Agent, for anything done or omitted
by the Rights Agent in connection with the acceptance and administration of this
Agreement, including the costs and expenses of defending against any claim of
liability arising therefrom, directly or indirectly. The provisions of this
Section 18(a) shall survive the expiration of the Rights and the termination of
this Agreement.
(b) The Rights Agent shall be protected and shall incur no liability for
or in respect of any action taken, suffered or omitted by it in connection with
its administration of this Agreement in reliance upon any Right Certificate or
certificate representing Common Stock of the Company, Preferred Stock, or other
securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document believed by it in good faith
and without negligence to be genuine and to be signed and executed by the proper
Person or Persons.
(c) The Rights Agent shall not be liable for consequential damages under
any provision of this Agreement or for any consequential damages arising out of
any act or failure to act hereunder.
SECTION 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS AGENT.
(a) Any corporation into which the Rights Agent or any successor Rights
Agent may be merged or with which it may be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any corporation succeeding to the
corporate trust or shareholder services business of the Rights Agent or any
successor Rights Agent, shall be the successor to the Rights Agent under this
Agreement without the execution or filing of any paper or any further act on the
part of any
- 28 -
of the parties hereto, provided that such corporation would be eligible for
appointment as a successor Rights Agent under the provisions of Section 21
hereof. In case at the time such successor Rights Agent shall succeed to the
agency created by this Agreement, any of the Right Certificates shall have been
countersigned but not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Right
Certificates so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Right Certificates either in the name of the predecessor or in
the name of the successor Rights Agent; and in all such cases such Right
Certificates shall have the full force provided in the Right Certificates and in
this Agreement.
(b) In case at any time the name of the Rights Agent shall be changed and
at such time any of the Right Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the countersignature under its prior name
and deliver Right Certificates so countersigned; and in case at that time any of
the Right Certificates shall not have been countersigned, the Rights Agent may
countersign such Right Certificates either in its prior name or in its changed
name; and in all such cases such Right Certificates shall have the full force
provided in the Right Certificates and in this Agreement.
SECTION 20. DUTIES OF RIGHTS AGENT. The Rights Agent undertakes the
duties and obligations expressly imposed by this Agreement upon the following
terms and conditions, by all of which the Company and the holders of Right
Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel selected by it (who
may be legal counsel for the Company), and the opinion of such counsel shall be
full and complete authorization and protection to the Rights Agent as to any
action taken or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement the
Rights Agent shall deem it necessary or desirable that any fact or matter
(including, without limitation, the identity of any Acquiring Person or Adverse
Person and the determination of "Fair Market Value") be proved or established by
the Company prior to taking or suffering any action hereunder, such fact or
matter (unless other evidence in respect thereof shall be herein specifically
prescribed) may be deemed to be conclusively proved and established by a
certificate signed by a person believed by the Rights Agent to be the Chairman
of the Board of Directors, a Vice Chairman of the Board of Directors, the
President, a Vice President, the Treasurer, any Assistant Treasurer, the Clerk
or an Assistant Clerk of the Company and delivered to the Rights Agent. Any such
certificate shall be full authorization to the Rights Agent for any action taken
or suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its own gross
negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any of the
statements of fact or recitals contained in this Agreement or in the Right
Certificates (except its
- 29 -
countersignature thereof) or be required to verify the same, but all such
statements and recitals are and shall be deemed to have been made by the Company
only.
(e) The Rights Agent shall not be under any responsibility in respect of
the validity of this Agreement or the execution and delivery hereof (except the
due execution hereof by the Rights Agent) or in respect of the validity or
execution of any Right Certificate (except its countersignature thereof); nor
shall it be responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any Right Certificate; nor shall it
be responsible for any change in the exercisability of the Rights (including the
Rights becoming void pursuant to Section 7(e) hereof) or any adjustment required
under the provisions of Sections 11, 13 or 23(c) hereof or responsible for the
manner, method or amount of any such adjustment or the ascertaining of the
existence of facts that would require any such adjustment (except with respect
to the exercise of Rights evidenced by Right Certificates after receipt of a
certificate describing any such adjustment furnished in accordance with Section
12 hereof), nor shall it be responsible for any determination by the Board of
Directors of the Fair Market Value of the Rights or Preferred Stock pursuant to
the provisions of Section 14 hereof; nor shall it by any act hereunder be deemed
to make any representation or warranty as to the authorization or reservation of
any shares of Common Stock of the Company or Preferred Stock to be issued
pursuant to this Agreement or any Right Certificate or as to whether any shares
of Common Stock of the Company or Preferred Stock will, when so issued, be
validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may reasonably be required
by the Rights Agent for the carrying out or performing by the Rights Agent of
the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder and
certificates delivered pursuant to any provision hereof from any person believed
by the Rights Agent to be the Chairman of the Board of Directors, any Vice
Chairman of the Board of Directors, the President, a Vice President, the Clerk,
an Assistant Clerk, the Treasurer or an Assistant Treasurer of the Company, and
is authorized to apply to such officers for advice or instructions in connection
with its duties, and it shall not be liable for any action taken or suffered to
be taken by it in good faith in accordance with instructions of any such
officer. Any application by the Rights Agent for written instructions from the
Company may, at the option of the Rights Agent, set forth in writing any action
proposed to be taken or omitted by the Rights Agent under this Agreement and the
date on or after which such action shall be taken or such omission shall be
effective. The Rights Agent shall not be liable for any action taken by, or
omission of, the Rights Agent in accordance with a proposal included in such
application on or after the date specified in such application (which date shall
not be less than five Business Days after the date any officer of the Company
actually receives such application, unless any such officer shall have consented
in writing to an earlier date) unless, prior to taking any such action (or the
effective date in the case of an omission), the Rights Agent shall have received
written instructions in response to such application specifying the action to be
taken or omitted.
- 30 -
(h) The Rights Agent and any shareholder, director, officer or employee
of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though it were not the Rights
Agent under this Agreement. Nothing herein shall preclude the Rights Agent from
acting in any other capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or powers
hereby vested in it or perform any duty hereunder either itself or by or through
its attorneys or agents.
(j) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if
there shall be reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not reasonably
assured to it.
(k) If, with respect to any Right Certificate surrendered to the Rights
Agent for exercise or transfer, the certificate attached to the form of
assignment or form of election to purchase, as the case may be, has either not
been completed or indicates an affirmative response to clause (1) or clause (2)
thereof, the Rights Agent shall not take any further action with respect to such
requested exercise or transfer without first consulting with the Company.
SECTION 21. CHANGE OF RIGHTS AGENT. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Agreement
upon thirty (30) days' notice in writing mailed to the Company by first class
mail. The Company may remove the Rights Agent or any successor Rights Agent
(with or without cause) upon thirty (30) days' notice in writing, mailed to the
Rights Agent or successor Rights Agent, as the case may be, and to each transfer
agent of the Common Stock of the Company and Preferred Stock by registered or
certified mail, and to the holders of the Right Certificates by first-class
mail. If the Rights Agent shall resign or be removed or shall otherwise become
incapable of acting, the Company shall appoint a successor to the Rights Agent.
If the Company shall fail to make such appointment within a period of thirty
(30) days after giving notice of such removal or after it has been notified in
writing of such resignation or incapacity by the resigning or incapacitated
Rights Agent or by the holder of a Right Certificate (who shall, with such
notice, submit his Right Certificate for inspection by the Company), then the
incumbent Rights Agent or the registered holder of any Right Certificate may
apply to any court of competent jurisdiction for the appointment of a new Rights
Agent. Any successor Rights Agent, whether appointed by the Company or by such a
court, shall be (a) a corporation organized and doing business under the laws of
the United States or of the Commonwealth of Massachusetts (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 Commonwealth of Massachusetts), in good standing,
which is authorized under such laws to exercise stock transfer or corporate
trust powers and is subject to supervision or examination by federal or state
authority and which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $15,000,000, or (b) an Affiliate of a
corporation described in clause (a) of this sentence. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent without
- 31 -
further act or deed; but the predecessor Rights Agent shall deliver and transfer
to the successor Rights Agent any property at the time held by it hereunder, and
execute and deliver any further assurance, conveyance, act or deed necessary for
the purpose. Not later than the effective date of any such appointment, the
Company shall file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common Stock of the Company and the Preferred
Stock, and mail a notice thereof in writing to the registered holders of the
Right Certificates. Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality or validity of the
resignation or removal of the Rights Agent or the appointment of the successor
Rights Agent, as the case may be.
SECTION 22. ISSUANCE OF NEW RIGHT CERTIFICATES. Notwithstanding any of
the provisions of this Agreement or of the Rights to the contrary, the Company
may, at its option, issue new Right Certificates evidencing Rights in such form
as may be approved by its Board of Directors to reflect any adjustment or change
in the Exercise Price per share and the number or kind or class of shares of
stock or other securities or property purchasable under the Right Certificates
made in accordance with the provisions of this Agreement. In addition, in
connection with the issuance or sale of shares of Common Stock of the Company
following the Distribution Date and prior to the redemption or expiration of the
Rights, the Company (a) shall, with respect to shares of Common Stock of the
Company so issued or sold pursuant to the exercise of stock options or under any
employee plan or arrangement, or upon the exercise, conversion or exchange of
securities hereafter issued by the Company, and (b) may, in any other case, if
deemed necessary or appropriate by the Board of Directors, issue Right
Certificates representing the appropriate number of Rights in connection with
such issuance or sale; provided, however, that (i) no such Right Certificate
shall be issued if, and to the extent that, the Company shall be advised by
counsel that such issuance would create a significant risk of material adverse
tax consequences to the Company or the person to whom such Right Certificate
would be issued, and (ii) no such Right Certificate shall be issued if, and to
the extent that, appropriate adjustments shall otherwise have been made in lieu
of the issuance thereof.
SECTION 23. REDEMPTION.
(a) The Board of Directors may, at its option, redeem all but not less
than all of the then outstanding Rights at a redemption price of $.001 per
Right, appropriately adjusted to reflect any dividend declared or paid on the
Common Stock of the Company in shares of Common Stock of the Company or any
subdivision or combination of the outstanding shares of Common Stock of the
Company or similar event occurring after the date of this Agreement (such
redemption price, as adjusted from time to time, being hereinafter referred to
as the "REDEMPTION PRICE"). The Rights may be redeemed only until the earlier to
occur of (i) 5:00 P.M., Boston, Massachusetts time, on the tenth calendar day
after the Stock Acquisition Date, (ii) the declaration by the Board of Directors
that any Person is an Adverse Person, or (iii) the Final Expiration Date.
(b) Immediately upon the action of the Board of Directors ordering the
redemption of the Rights, and without any further action and without any notice,
the right to exercise the Rights will terminate and the only right thereafter of
the holders of Rights shall be to receive the Redemption Price for each Right so
held. Promptly after the action of the Board of Directors ordering the
redemption of the Rights, the Company shall give notice of such
- 32 -
redemption to the Rights Agent and the holders of the then outstanding Rights by
mailing such notice to the Rights Agent and to all such holders at their last
addresses as they appear upon the registry books of the Rights Agent or, prior
to the Distribution Date, on the registry books of the Transfer Agent for the
Common Stock of the Company. Any notice which is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives the notice.
Each such notice of redemption will state the method by which the payment of the
Redemption Price will be made. Neither the Company nor any of its Affiliates or
Associates may redeem, acquire or purchase for value any Rights at any time in
any manner other than that specifically set forth in this Section 23 or Section
24 hereof or in connection with the purchase of shares of Common Stock of the
Company prior to the Distribution Date.
(c) The Company may, at its option, pay the Redemption Price in cash,
shares of Common Stock of the Company (based on the Fair Market Value of the
Common Stock of the Company as of the time of redemption) or any other form of
consideration deemed appropriate by the Board of Directors.
SECTION 24. EXCHANGE.
(a) (i) The Board of Directors may, at its option, at any time on
or after the Distribution Date, 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 shares of Common Stock of the Company at an exchange ratio
of one share of Common Stock of the Company per Right, appropriately
adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof (such exchange ratio being
hereinafter referred to as the "SECTION 24(A)(I) EXCHANGE RATIO").
Notwithstanding the foregoing, the Board of Directors shall not be
empowered to effect such exchange at any time after any Person (other
than an Exempt Person), together with all Affiliates and Associates of
such Person, becomes the Beneficial Owner of 50% or more of the Common
Stock of the Company.
(ii) Notwithstanding the foregoing, the Board of Directors may,
at its option, at any time on or after the Distribution Date, 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 shares of Common Stock of the
Company at an exchange ratio specified in the following sentence, as
appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date of this Agreement.
Subject to the adjustment described in the foregoing sentence, each
Right may be exchanged for that number of shares of Common Stock of
the Company obtained by dividing the Spread (as defined in Section
11(a)(iii)) by the then Fair Market Value per one one-thousandth of a
share of Preferred Stock on the earlier of (x) the date on which any
person becomes an Acquiring Person or (y) the date on which a tender
or exchange offer by any Person (other than an Exempt Person) is first
published or sent or given within the meaning of Rule 14d-4(a) of the
Exchange Act or any successor rule, if upon consummation thereof such
Person would be the Beneficial Owner of more than 15% of the shares of
Common Stock of the Company then outstanding (such exchange ratio
being referred to herein as the "SECTION 24(A)(II) EXCHANGE RATIO").
Notwithstanding the foregoing, the Board of Directors shall not be
empowered to effect
- 33 -
such exchange at any time after any Person (other than an Exempt
Person), together with all Affiliates and Associates of such Person,
becomes the Beneficial Owner of 50% or more of the Common Stock of the
Company.
(b) Immediately upon the action of the Board of Directors ordering the
exchange of any Rights pursuant to subsection (a) of this Section 24 and without
any further action and without any notice, the right to exercise such Rights
shall terminate and the only right thereafter of a holder of such Rights shall
be to receive that number of shares of Common Stock of the Company equal to the
number of such Rights held by such holder multiplied by the Section 24(a)(i)
Exchange Ratio or the Section 24(a)(ii) Exchange Ratio, as applicable. The
Company shall promptly give notice of any such exchange in accordance with
Section 26 hereof and shall promptly mail a notice of any such exchange to all
of the holders of such Rights at their last addresses as they appear upon the
registry books of the Rights Agent; provided, however, that the failure to give,
or any defect in, such notice shall not affect the validity of such exchange.
Any notice which is mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice. Each such notice of exchange will
state the method by which the exchange of the shares of Common Stock of the
Company for Rights will be effected and, in the event of any partial exchange,
the number of Rights which will be exchanged. Any partial exchange shall be
effected pro rata based on the number of Rights (other than Rights which have
become void pursuant to the provisions of Section 7(e) hereof) held by each
holder of Rights.
(c) In any exchange pursuant to this Section 24, the Company, at its
option, may substitute Preferred Stock (or Preferred Stock Equivalent, as such
term is defined in Section 11(b) hereof) for Common Stock of the Company
exchangeable for Rights, at the initial rate of one one-thousandth of a share of
Preferred Stock (or Preferred Stock Equivalent) for each share of Common Stock
of the Company, as appropriately adjusted to reflect adjustments in the voting
rights of the Preferred Stock pursuant to the terms thereof, so that the
fraction of a share of Preferred Stock delivered in lieu of each share of Common
Stock of the Company shall have the same voting rights as one share of Common
Stock of the Company.
(d) In the event that there shall not be sufficient shares of Common
Stock of the Company or Preferred Stock (or Preferred Stock Equivalent) issued
but not outstanding or authorized but unissued to permit any exchange of Rights
as contemplated in accordance with this Section 24, the Company shall take all
such action as may be necessary to authorize additional shares of Common Stock
of the Company or Preferred Stock (or Preferred Stock Equivalent) for issuance
upon exchange of the Rights.
(e) The Company shall not be required to issue fractions of Common Stock
of the Company or to distribute certificates which evidence fractional shares of
Common Stock of the Company. If the Company elects not to issue such fractional
shares of Common Stock of the Company, the Company shall pay, in lieu of such
fractional shares of Common Stock of the Company, to the registered holders of
the Right Certificates with regard to which such fractional shares of Common
Stock of the Company would otherwise be issuable, an amount in cash equal to the
same fraction of the Fair Market Value of a whole share of Common Stock of the
Company. For the purposes of this paragraph (e), the Fair Market Value of a
whole share of Common Stock of the Company shall be the closing price of a share
of Common Stock of the
- 34 -
Company (as determined pursuant to the second sentence of Section 11(d)(i)
hereof) for the Trading Day immediately prior to the date of exchange pursuant
to this Section 24.
SECTION 25. NOTICE OF CERTAIN EVENTS.
(a) In case the Company shall propose, at any time after the Distribution
Date, (i) to pay any dividend payable in stock of any class to the holders of
Preferred Stock or to make any other distribution to the holders of Preferred
Stock (other than a regular periodic cash dividend out of earnings or retained
earnings of the Company), or (ii) to offer to the holders of Preferred Stock
rights or warrants to subscribe for or to purchase any additional shares of
Preferred Stock or shares of stock of any class or any other securities, rights
or options, or (iii) to effect any reclassification of its Preferred Stock
(other than a reclassification involving only the subdivision of outstanding
shares of Preferred Stock), or (iv) to effect any consolidation or merger into
or with, or to effect any sale, mortgage or other transfer (or to permit one or
more of its Subsidiaries to effect any sale, mortgage or other transfer), in one
transaction or a series of related transactions, of 50% or more of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to, any
other Person (other than a Subsidiary of the Company in one or more transactions
each of which is not prohibited by the proviso at the end of the first sentence
of Section 11(n) hereof), (v) to effect the liquidation, dissolution or winding
up of the Company, or (vi) to declare or pay any dividend on the Common Stock of
the Company payable in Common Stock of the Company or to effect a subdivision,
combination or consolidation of the Common Stock of the Company (by
reclassification or otherwise than by payment of dividends in Common Stock of
the Company) then in each such case, the Company shall give to each holder of a
Right Certificate and to the Rights Agent, in accordance with Section 26 hereof,
a notice of such proposed action, which shall specify the record date for the
purposes of such stock dividend, distribution of rights or warrants, or the date
on which such reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution, or winding up is to take place and the date of
participation therein by the holders of the shares of Common Stock of the
Company and/or Preferred Stock, if any such date is to be fixed, and such notice
shall be so given in the case of any action covered by clause (i) or (ii) above
at least twenty (20) days prior to the record date for determining holders of
the shares of Preferred Stock for purposes of such action, and in the case of
any such other action, at least twenty (20) days prior to the date of the taking
of such proposed action or the date of participation therein by the holders of
the shares of Common Stock of the Company and/or Preferred Stock, whichever
shall be the earlier; provided, however, no such notice shall be required
pursuant to this Section 25 as a result of any Subsidiary of the Company
effecting a consolidation or merger with or into, or effecting a sale or other
transfer of assets or earnings power to, any other Subsidiary of the Company in
a manner not inconsistent with the provisions of this Agreement.
(b) In case any Section 11(a)(ii) Event shall occur, then, in any such
case, the Company shall as soon as practicable thereafter give to each
registered holder of a Right Certificate and to the Rights Agent, in accordance
with Section 26 hereof, a notice of the occurrence of such event, which shall
specify the event and the consequences of the event to holders of Rights under
Section 11(a)(ii) hereof.
SECTION 26. NOTICES. Notices or demands authorized by this Agreement to
be given or made by the Rights Agent or by the holder of any Right Certificate
to or on the Company shall be
- 35 -
sufficiently given or made if sent by first-class mail, postage prepaid, by
facsimile transmission or by nationally-recognized overnight courier addressed
(until another address is filed in writing with the Rights Agent) as follows:
Independent Bank Corp.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
with a copy to:
▇▇▇▇ ▇▇▇▇▇▇, Esq.
Peabody & ▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Subject to the provisions of Section 21 hereof, any notice or demand authorized
by this Agreement to be given or made by the Company or by the holder of any
Right Certificates to or on the Rights Agent shall be sufficiently given or made
if sent by first-class mail, postage prepaid, by facsimile transmission or by
nationally-recognized overnight courier, addressed (until another address is
filed in writing with the Company) as follows:
Rockland Trust Company
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
with a copy to:
▇▇▇▇ ▇▇▇▇▇▇, Esq.
Peabody & ▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificates (or, if
prior to the Distribution Date, to the holder of any certificate representing
shares of Common Stock of the Company) shall be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed to such holder at the
address of such holder as shown on the registry records of the Company.
SECTION 27. SUPPLEMENTS AND AMENDMENTS. Prior to the Distribution Date,
the Company and the Rights Agent shall, if the Company so directs, supplement or
amend any provision of this Agreement as the Company may deem necessary or
desirable without the approval of any holders of certificates representing
shares of Common Stock of the Company. From and after the Distribution Date, the
Company and the Rights Agent shall, if the Company so directs, supplement or
amend this Agreement without the approval of any holder of Right Certificates in
order (i) to cure any ambiguity, (ii) to correct or supplement any provision
- 36 -
contained herein which may be defective or inconsistent with any other
provisions herein, (iii) to shorten or lengthen any time period hereunder, or
(iv) to change or supplement the provisions hereof in any manner which the
Company may deem necessary or desirable and which shall not adversely affect the
interests of the holders of Right Certificates (other than an Acquiring Person,
Adverse Person or any Affiliate or Associate of an Acquiring Person or Adverse
Person); provided, however, that from and after the Distribution Date this
Agreement may not be supplemented or amended to lengthen, pursuant to clause
(iii) of this sentence, (A) a time period relating to when the Rights may be
redeemed at such time as the Rights are not then redeemable or (B) any other
time period unless such lengthening is for the purpose of protecting, enhancing
or clarifying the rights of, and the benefits to, the holders of Rights (other
than an Acquiring Person, Adverse Person or any Affiliate or Associate of an
Acquiring Person or Adverse Person). Without limiting the foregoing, the Company
may at any time prior to such time as any Person becomes an Acquiring Person
amend this Agreement to lower the threshold set forth in Section 1(a) to not
less than the greater of (i) the sum of .001% and the largest percentage of the
outstanding Common Stock of the Company then known by the Company to be
beneficially owned 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 Common Stock of the Company for or pursuant to
the terms of any such plan) and (ii) 10%. Upon the delivery of such certificate
from an appropriate officer of the Company which states that the proposed
supplement or amendment is in compliance with the terms of this Section 27, the
Rights Agent shall execute such supplement or amendment. Prior to the
Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Common Stock of the Company.
Notwithstanding any other provision hereof, the Rights Agent's consent must be
obtained regarding any amendment or supplement pursuant to this Section 27 which
alters the Rights Agent's rights or duties.
SECTION 28. SUCCESSORS. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
SECTION 29. DETERMINATIONS AND ACTIONS BY THE BOARD OF DIRECTORS. For all
purposes of this Agreement, any calculation of the number of shares of Common
Stock of the Company outstanding at any particular time, including for purposes
of determining the particular percentage of such outstanding shares of Common
Stock of the Company of which any Person is the Beneficial Owner, shall be made
in accordance with the last sentence of Rule 13d-3(d)(1)(i) of the Rules under
the Exchange Act as in effect on the date hereof. The Board of Directors shall
have the exclusive power and authority to administer this Agreement and to
exercise all rights and powers specifically granted to the Board of Directors or
to the Company, or as may be necessary or advisable in the administration of
this Agreement, including without limitation, the right and power to (i)
interpret the provisions of this Agreement, and (ii) make all determinations
deemed necessary or advisable for the administration of this Agreement
(including a determination to redeem or not redeem the Rights or to amend the
Agreement). All such actions, calculations, interpretations and determinations
(including, for purposes of clause (y) below, all omissions with respect to the
foregoing) which are done or made by the Board of Directors in good faith shall
(x) be final, conclusive and binding on the Company, the Rights Agent, the
holders of the Rights and all other parties, and (y) not subject any member of
the Board of Directors to any liability to the holders of the Rights or to any
other person.
- 37 -
SECTION 30. BENEFITS OF THIS AGREEMENT. Nothing in this Agreement shall
be construed to give to any person or corporation other than the Company, the
Rights Agent and the registered holders of the Right Certificates (and, prior to
the Distribution Date, the Common Stock of the Company) any legal or equitable
right, remedy or claim under this Agreement; but this Agreement shall be for the
sole and exclusive benefit of the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date,
registered holders of the Common Stock of the Company).
SECTION 31. SEVERABILITY. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction or other
authority to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall remain in full
force and effect and shall in no way be affected, impaired or invalidated;
provided, however, that notwithstanding anything in this Agreement to the
contrary, if any such term, provision, covenant or restriction is held by such
court or authority to be invalid, void or unenforceable and the Board of
Directors determines in its good faith judgment that severing the invalid
language from the Agreement would adversely affect the purpose or effect of the
Agreement, the right of redemption set forth in Section 23 hereof shall be
reinstated and shall not expire until the Close of Business on the tenth day
following the date of such determination by the Board of Directors.
SECTION 32. GOVERNING LAW. This Agreement, each Right and each Right
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the Commonwealth of Massachusetts and for all purposes shall be governed
by and construed in accordance with the laws of such Commonwealth applicable to
contracts to be made and to be performed entirely within such Commonwealth. The
courts of the Commonwealth of Massachusetts and of the United States of America
located in the Commonwealth of Massachusetts (the "MASSACHUSETTS COURTS") shall
have exclusive jurisdiction over any litigation arising out of or relating to
this Agreement and the transactions contemplated hereby, and any Person
commencing or otherwise involved in any such litigation shall waive any
objection to the laying of venue of such litigation in the Massachusetts Courts
and shall not plead or claim in any Massachusetts Court that such litigation
brought therein has been brought in an inconvenient forum.
SECTION 33. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
SECTION 34. DESCRIPTIVE HEADINGS. Descriptive headings of the several
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
- 38 -
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as an instrument under seal and attested, all as of the day and
year first above written.
Attest: INDEPENDENT BANK CORP.
By: ___________________________ By: _____________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Clerk Title: Chairman, President, and
Chief Executive Officer
Attest: ROCKLAND TRUST COMPANY
By: ___________________________ By: _____________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Clerk Title: Chairman, President, and
Chief Executive Officer
- 39 -
EXHIBIT A
VOTE OF DIRECTORS ESTABLISHING
SERIES B JUNIOR PARTICIPATING CUMULATIVE
PREFERRED STOCK
of
INDEPENDENT BANK CORP.
Pursuant to Section 26 of Chapter 156B of the General Laws of The
Commonwealth of Massachusetts:
VOTED, that pursuant to authority conferred upon and vested in the
Board of Directors by the Restated Articles of Organization, as amended (the
"Articles"), of Independent Bank Corp. (the "Corporation'), the Board of
Directors hereby establishes and designates a series of preferred stock of the
Corporation, and hereby fixes and determines the relative rights and preferences
of the shares of such series, in addition to those set forth in the Articles, as
follows:
SECTION 1. DESIGNATION AND AMOUNT. The shares of such series shall be
designated as "Series B Junior Participating Cumulative Preferred Stock" (the
"Series B Preferred Stock"), and the number of shares constituting such series
shall be 15,000.
SECTION 2. DIVIDENDS AND DISTRIBUTIONS.
(a) (i) Subject to the rights of the holders of any shares of any
series of preferred stock (or any similar stock) ranking prior
and superior to the Series B Preferred Stock with respect to
dividends, the holders of shares of Series B Preferred Stock, in
preference to the holders of shares of common stock and of any
other junior stock, shall be entitled to receive, when, as and if
declared by the Board of Directors out of funds legally available
for the purpose, quarterly dividends payable in cash on the first
day of March, June, September and December in each year (each
such date being referred to herein as a "Quarterly Dividend
Payment Date"), commencing on the first Quarterly Dividend
Payment Date after the first issuance of a share or fraction of a
share of Series B Preferred Stock, in an amount per share
(rounded to the nearest cent) equal to the greater of (a) $1.00
or (b) subject to the provisions for adjustment hereinafter set
forth, 1,000 times the aggregate per share amount of all cash
dividends, and 1,000 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other
distributions other than a dividend payable in shares of common
stock or a subdivision of the outstanding shares of common stock
(by reclassification or otherwise), declared on the common stock
since the immediately preceding Quarterly Dividend Payment Date,
or, with respect to the first Quarterly Dividend Payment Date,
since the first issuance of any share or fraction of a share of
Series B Preferred Stock. The multiple of cash and non-cash
dividends declared on the common stock to which holders of the
Series B Preferred Stock are entitled,
1A
which shall be 1,000 initially but which shall be adjusted from
time to time as hereinafter provided, is hereinafter referred to
as the "Dividend Multiple." In the event the Corporation shall at
any time after May 3, 2001 (the "Rights Declaration Date") (i)
declare or pay any dividend on common stock payable in shares of
common stock, or (ii) effect a subdivision or combination or
consolidation of the outstanding shares of common stock (by
reclassification or otherwise than by payment of a dividend in
shares of common stock) into a greater or lesser number of shares
of common stock, then in each such case the Dividend Multiple
thereafter applicable to the determination of the amount of
dividends which holders of shares of Series B Preferred Stock
shall be entitled to receive shall be the Dividend Multiple
applicable immediately prior to such event multiplied by a
fraction, the numerator of which is the number of shares of
common stock outstanding immediately after such event and the
denominator of which is the number of shares of common stock that
were outstanding immediately prior to such event.
(ii) Notwithstanding anything else contained in this paragraph
(a), the Corporation shall, out of funds legally available for that
purpose, declare a dividend or distribution on the Series B 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 $1.00
per share on the Series B Preferred Stock shall nevertheless be
payable on such subsequent Quarterly Dividend Payment Date.
(b) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series B Preferred Stock from the Quarterly Dividend Payment Date next
preceding the date of issue of such shares of Series B 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 B 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 B Preferred Stock in
an amount less than the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding. The Board of Directors may fix in
accordance with applicable law a record date for the determination of holders of
shares of Series B Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be not more than such
number of days prior to the date fixed for the payment thereof as may be allowed
by applicable law.
2A
SECTION 3. VOTING RIGHTS. In addition to any other voting rights required
by law, the holders of shares of Series B Preferred Stock shall have the
following voting rights:
(a) Subject to the provision for adjustment hereinafter set forth, each
share of Series B Preferred Stock shall entitle the holder thereof to 1,000
votes on all matters submitted to a vote of the stockholders of the Corporation.
The number of votes which a holder of a share of Series B Preferred Stock is
entitled to cast, which shall initially be 1,000 but which may be adjusted from
time to time as hereinafter provided, is hereinafter referred to as the "Vote
Multiple." In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare or pay any dividend on common stock payable in
shares of common stock, or (ii) effect a subdivision or combination or
consolidation of the outstanding shares of common stock (by reclassification or
otherwise than by payment of a dividend in shares of common stock) into a
greater or lesser number of shares of common stock, then in each case the Vote
Multiple thereafter applicable to the determination of the number of votes per
share to which holders of shares of Series B Preferred Stock shall be entitled
shall be the Vote Multiple immediately prior to such event multiplied by a
fraction, the numerator of which is the number of shares of common stock
outstanding immediately after such event and the denominator of which is the
number of shares of common stock that were outstanding immediately prior to such
event.
(b) Except as otherwise provided herein or by law, the holders of
shares of Series B Preferred Stock and the holders of shares of common stock
and the holders of shares of any other capital stock of this Corporation
having general voting rights, shall vote together as one class on all matters
submitted to a vote of stockholders of the Corporation.
(c) Except as otherwise required by applicable law or as set forth
herein, holders of Series B 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 dividends or distributions payable on the Series B 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 B Preferred Stock outstanding shall have been paid in full the
Corporation shall not:
(i) declare or pay dividends on, make any other distributions on,
or redeem or purchase or otherwise acquire for consideration any
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series B Preferred
Stock;
(ii) declare or pay dividends on or make any other distributions
on any shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series B
Preferred Stock, except dividends paid ratably on the Series B
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;
3A
(iii) except as permitted in subsection 4(a)(iv) below, redeem,
purchase or otherwise acquire for consideration shares of any stock
ranking on a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series B 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 B Preferred
Stock; or
(iv) purchase or otherwise acquire for consideration any shares
of Series B Preferred Stock, or any shares of any stock ranking on a
parity (either as to dividends or upon liquidation, dissolution or
winding up) with the Series B Preferred Stock, except in accordance
with a purchase offer made in writing or by publication (as determined
by the Board of Directors) to all holders of such shares upon such
terms as the Board of Directors, after consideration of the respective
annual dividend rates and other relative rights and preferences of the
respective series and classes, shall determine in good faith will
result in fair and equitable treatment among the respective series or
classes.
(b) The Corporation shall not permit any subsidiary of the Corporation to
purchase or otherwise acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under subsection (a) of this Section
4, purchase or otherwise acquire such shares at such time and in such manner.
SECTION 5. REACQUIRED SHARES. Any shares of Series B Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and canceled promptly after the acquisition thereof. All such
shares shall upon their cancellation become authorized but unissued shares of
preferred stock and may be reissued as part of a new series of preferred stock
to be created be resolution or resolutions of the Board of Directors, subject to
the conditions and restrictions on issuance set forth herein.
SECTION 6. LIQUIDATION, DISSOLUTION OR WINDING-UP. Upon any liquidation
(voluntary or otherwise), dissolution or winding up of the Corporation, no
distribution shall be made (x) to the holders of shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or winding up) to the
Series B Preferred Stock unless, prior thereto, the holders of shares of Series
B Preferred Stock shall have received an amount equal to accrued and unpaid
dividends and distributions thereon, whether or not declared, to the date of
such payment, plus an amount equal to the greater of (1) $1,000.00 per share or
(2) an aggregate amount per share, subject to the provision for adjustment
hereinafter set forth, equal to 1,000 times the aggregate amount to be
distributed per share to holders of common stock, or (y) to the holders of stock
ranking on a parity (either as to dividends or upon liquidation, dissolution or
winding up) with the Series B Preferred Stock, except distributions made ratably
on the Series B Preferred Stock and all other such parity stock in proportion to
the total amounts to which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. In the event the Corporation shall at
any time after the Rights Declaration Date (i) declare or pay any dividend on
common stock payable in shares of common stock, or (ii) effect a subdivision or
combination or consolidation of the outstanding shares of common stock (by
reclassification or otherwise than by payment of a dividend in shares of common
stock) into a greater or lesser number of shares of
4A
common stock, then in each such case the aggregate amount per share to which
holders of shares of Series B Preferred Stock were entitled immediately prior to
such event under clause (x) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction, the numerator of which is the number of
shares of common stock outstanding immediately after such event and the
denominator of which is the number of shares of common stock that were
outstanding immediately prior to such event.
Neither the consolidation of nor merging of the Corporation with or into
any other corporation or corporations, nor the sale or other transfer of all of
substantially all of the assets of the Corporation, shall be deemed to be a
liquidation, dissolution or winding up of the Corporation within the meaning of
this Section 6.
SECTION 7. CONSOLIDATION, MERGER, ETC. In case the Corporation shall
enter into any consolidation, merger, combination or other transaction in which
the shares of common stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares of
Series B Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 1,000 times the aggregate amount of stock,
securities, cash and/or any other property (payable in kind), as the case may
be, into which or for which each share of common stock is changed or exchanged,
plus accrued and unpaid dividends, if any, payable with respect to the Series B
Preferred Stock. In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare or pay any dividend on common stock payable in
shares of common stock, or (ii) effect a subdivision or combination or
consolidation of the outstanding shares of common stock (by reclassification or
otherwise than by payment of a dividend in shares of common stock) into a
greater or lesser number of shares of common stock, then in each such case the
amount set forth in the preceding sentence with respect to the exchange or
change of shares of Series B Preferred Stock shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number of shares of
common stock outstanding immediately after such event and the denominator of
which is the number of shares of common stock that were outstanding immediately
prior to such event.
SECTION 8. REDEMPTION. The shares of Series B Preferred Stock shall not
be redeemable.
SECTION 9. RANKING. Unless otherwise provided in the Articles or a
Certificate of Vote of Directors Establishing a Class of Stock relating to a
subsequently-designated series of preferred stock of the Corporation, the Series
B Preferred Stock shall rank junior to any other series of the Corporation's
preferred stock subsequently issued, as to the payment of dividends and the
distribution of assets on liquidation, dissolution or winding up and shall rank
senior to the common stock.
SECTION 10. AMENDMENT. The Articles and this Certificate of Vote of
Directors Establishing a Class of Stock shall not be amended in any manner which
would materially alter or change the powers, preferences or special rights of
the Series B Preferred Stock so as to affect them adversely (within the meaning
of Section 77 of Chapter 156B of the Massachusetts General Laws) without the
affirmative vote of the holders of two-thirds or more of the outstanding shares
of Series B Preferred Stock, voting separately as a class.
5A
SECTION 11. FRACTIONAL SHARES. Series B Preferred Stock may be issued in
whole shares or in any fraction of a share that is one one-thousandth
(1/1,000th) of a share of any integral multiple of such fraction, which shall
entitle the holder, in proportion to such holder's fractional shares, to
exercise voting rights, receive dividends, participate in distributions and to
have the benefit of all other rights of holders of Series B Preferred Stock. In
lieu of fractional shares, the Corporation may elect to make a cash payment as
provided in the Rights Agreement for fractions of a share other than one
one-thousandth (1/1,000th) of a share or any integral multiple thereof.
6A
EXHIBIT B
[Form of Right Certificate]
Certificate No. R- ______________ Rights
NOT EXERCISABLE AFTER MAY 3, 2011, SUBJECT TO EARLIER REDEMPTION,
EXCHANGE OR EXPIRATION PURSUANT TO THE RENEWAL RIGHTS AGREEMENT. THE
RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT
$.001 PER RIGHT, AND ARE SUBJECT TO EXCHANGE AT THE OPTION OF THE
COMPANY FOR SHARES OF COMMON STOCK OF THE COMPANY, ALL ON THE TERMS
SET FORTH IN THE RENEWAL RIGHTS AGREEMENT. THE RIGHTS SHALL NOT BE
EXERCISABLE, AND SHALL BE VOID SO LONG AS HELD, BY A HOLDER IN ANY
JURISDICTION WHERE THE REQUISITE QUALIFICATION TO THE ISSUANCE TO SUCH
HOLDER, OR THE EXERCISE BY SUCH HOLDER, OF THE RIGHTS IN SUCH
JURISDICTION SHALL NOT HAVE BEEN OBTAINED OR BE OBTAINABLE. UNDER
CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING
PERSON, AN ADVERSE PERSON, OR AN ASSOCIATE OR AFFILIATE OF AN
ACQUIRING PERSON OR AN ADVERSE PERSON (AS SUCH TERM IS DEFINED IN THE
RENEWAL RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY
BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHT
CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR
BECAME AN ACQUIRING PERSON, AN ADVERSE PERSON OR AN AFFILIATE OR
ASSOCIATE OF AN ACQUIRING PERSON OR AN ADVERSE PERSON (AS SUCH TERMS
ARE DEFINED IN THE RENEWAL RIGHTS AGREEMENT). THIS RIGHT CERTIFICATE
AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID UNDER
CERTAIN CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RENEWAL RIGHTS
AGREEMENT.]*
--------------------------------------------------
* The portion of the legend in brackets shall be inserted only if
applicable and shall replace the preceding sentence.
1B
RIGHT CERTIFICATE
Independent Bank Corp.
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 Renewal Rights Agreement, dated as of September 14, 2000 (the "Renewal
Rights Agreement"), between Independent Bank Corp., a Massachusetts corporation
(the "Company"), and Rockland Trust Company, a Massachusetts chartered trust
company (the "Rights Agent"), to purchase from the Company at any time prior to
5:00 p. m. (Boston, Massachusetts time) on May 3, 2011 at the office or offices
of the Rights Agent designated for such purpose, or its successors as Rights
Agent, one one-thousandth of a fully paid, nonassessable share of Series B
Junior Participating Cumulative Preferred Stock (the "Preferred Stock") of the
Company, at an Exercise Price of $[____] per one one-thousandth of a share (the
"Exercise Price"), upon presentation and surrender of this Right Certificate
with the Form of Election to Purchase and related Certificate duly executed. The
number of Rights evidenced by this Right Certificate (and the number of shares
which may be purchased upon exercise thereof) set forth above, and the Exercise
Price set forth above, are the number and Exercise Price as of ____________,
______, based on the Preferred Stock as constituted at such date.
As more fully set forth in the Renewal Rights Agreement, upon the
occurrence of a Section 11(a)(ii) Event (as such term is defined in the Renewal
Rights Agreement), if the Rights evidenced by this Right Certificate are
beneficially owned by (i) an Acquiring Person or an Adverse Person or any
Affiliate or Associate of an Acquiring Person or an Adverse Person (as such
terms are defined in the Renewal Rights Agreement, (ii) a transferee of any such
Acquiring Person or an Adverse Person (or any Affiliate or Associate) who
becomes a transferee after such Acquiring Person or an Adverse Person, (or any
Affiliate or Associate) becomes such, (iii) under certain circumstances
specified in the Renewal Rights Agreement, a transferee of any such Acquiring
Person or Adverse Person (or any Affiliate or Associate) who becomes a
transferee prior to or concurrently with such Acquiring Person or Adverse Person
(or Affiliate or Associate of any Acquiring Person or Adverse Person) becoming
such, such Rights shall become null and void and no holder hereof shall have any
right with respect to such Rights from and after the occurrence of such Section
11(a)(ii) Event.
The Rights evidenced by this Right Certificate shall not be
exercisable, and shall be void so long as held, by a holder in any jurisdiction
where the requisite qualification to the issuance to such holder, or the
exercise by such holder, of the Rights in such jurisdiction shall not have been
obtained or be obtainable.
As provided in the Renewal Rights Agreement, the Exercise Price and the
number or kind of shares of Preferred Stock or other securities, which may be
purchased upon the exercise of the Rights evidenced by this Right Certificate
are subject to modification and adjustment upon
2B
the happening of certain events, including Triggering Events (as such term is
defined in the Renewal Rights Agreement).
This Right Certificate is subject to all of the terms, provisions and
conditions of the Renewal Rights Agreement, which terms, provisions and
conditions are hereby incorporated herein by reference and made a part hereof
and to which Renewal Rights Agreement reference is hereby made for a full
description of the rights, limitations of rights, obligations, duties and
immunities hereunder of the Rights Agent, the Company and the holders of the
Right Certificates, which limitations of rights include the temporary suspension
of the exercisability of such Rights under the specific circumstances set forth
in the Renewal Rights Agreement. The Renewal Rights Agreement is on file at the
principal office of the Company. Copies of the Renewal Rights Agreement are
available upon written request to the Company or the Rights Agent.
This Right Certificate, with or without other Right Certificates, upon
surrender at the principal office or offices of the Rights Agent designated for
such purpose, may be exchanged for another Right Certificate or Right
Certificates of like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of one one-thousandth of a share of Preferred
Stock as the Rights evidenced by the Right Certificate or Right Certificates
surrendered shall have entitled such holder to purchase. If this Right
Certificate shall be exercised or exchanged in part, the holder shall be
entitled to receive upon surrender hereof another Right Certificate or Right
Certificates for the number of whole Rights not exercised or exchanged.
Subject to the provisions of the Renewal Rights Agreement, the Rights
evidenced by this Certificate may be redeemed by the Company at its option at a
redemption price of $.001 per Right at any time prior to the earlier of (i) 5:00
p.m., Boston, Massachusetts time, on the tenth calendar day following the Stock
Acquisition Date (as such term is defined in, and as such time period may be
extended pursuant to, the Renewal Rights Agreement), (ii) the declaration by the
Board of Directors that any person is an Adverse Person (as such term is defined
in the Renewal Rights Agreement) or (iii) the Final Expiration Date (as such
term is defined in the Renewal Rights Agreement).
No holder, as such, of this Right 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 or exchange hereof, nor shall anything contained in
the Renewal Rights Agreement or herein be construed or confer upon the holder
hereof, as such, any of the rights of a stockholder of the Company or any right
to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or, to receive notice of meetings or other actions affecting
stockholders (except as provided in the Renewal Rights Agreement), or to receive
dividends or subscription rights, or otherwise, until the Right or Rights
evidenced by this Right Certificate shall have been exercised or exchanged as
provided in the Renewal Rights Agreement.
This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
3B
WITNESS the facsimile signature of the proper officers of the Company
and its corporate seal.
Attested: INDEPENDENT BANK CORP.
By: ___________________________ By: _________________________________________
Title: Title:
[Clerk or Assistant Clerk] [Chairman, President or Vice President]
Attested:
By: ___________________________ By: _________________________________________
Title: Title:
[Clerk or Assistant Clerk] [Treasurer, Assistant Treasurer, Clerk
or Assistant Clerk]
Countersigned:
ROCKLAND TRUST COMPANY,
as Rights Agent
By: _________________________________
Authorized Signatory
Dated as of _________________________
4B
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to
transfer the Right Certificate)
FOR VALUE RECEIVED _____________________________________________________________
hereby sells, assigns and transfers unto _______________________________________
________________________________________________________________________________
(Please print name and address of transferee)
________________________________________________________________________________
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint _____________ Attorney, to
transfer the within Right Certificate on the books of the within-named Company,
with full power of substitution.
Dated: __________________________
_____________________________
Signature
Signature Guaranteed:
___________________________
5B
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) this Right Certificate [ ] is [ ] is not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person or an
Affiliate or Associate of any Acquiring Person (as such terms are defined in the
Renewal Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned, the
undersigned [ ] did [ ] did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or subsequently became an Acquiring
Person or an Affiliate or Associate of an Acquiring Person.
Dated: ________________________ _________________________________
Signature
Signature Guaranteed:
___________________________
NOTICE
The signature to the foregoing Assignment and Certificate must
correspond to the name as written upon the face of this Right Certificate in
every particular, without alteration or enlargement or any change whatsoever.
6B
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires
to exercise Rights represented
by the Right Certificate.)
To: INDEPENDENT BANK CORP.
The undersigned hereby irrevocably elects to exercise
__________ Rights represented by this Right Certificate to purchase the shares
of Preferred Stock issuable upon the exercise of the Rights (or such other
securities of the Company or of any other person which may be issuable upon the
exercise of the Rights) and requests that certificates for such shares be issued
in the name of and delivered to:
Please insert social security number
or other identifying number
________________________________________________________________________________
(Please print name and address)
________________________________________________________________________________
If such number of Rights shall not be all the Rights evidenced by this
Right Certificate, a new Right Certificate for the balance of Such Rights shall
be registered in the name of and delivered to:
Please insert social security number
or other identifying number
________________________________________________________________________________
(Please print name and address)
________________________________________________________________________________
________________________________________________________________________________
Dated: _________________
_____________________________
Signature
Signature Guaranteed:
___________________________
7B
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Right Certificate [ ] are [ ]are not
being exercised by or on behalf of a Person who is or was an Acquiring Person or
an Affiliate or Associate of an Acquiring Person (as such terms are defined in
the Renewal Rights Agreement);
(2) after due inquiry and to the best knowledge of the undersigned, the
undersigned [ ] did [ ] did not acquire the Rights evidenced by this Right
Certificate from any Person who is, was or became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Dated: _______________________
__________________________
Signature
Signature Guaranteed:
___________________________
NOTICE
The signature to the foregoing Election to Purchase and Certificate
must correspond to the name as written upon the face of this Right Certificate
in every particular, without alteration or enlargement or any change whatsoever.
8B