TECO ENERGY, INC.
and
BANKBOSTON, N.A.
Rights Agent
RENEWED RIGHTS AGREEMENT
Dated as of October 21, 1998
TABLE OF CONTENTS
Section 1. Certain Definitions. . . . . . . . . . . . . . . . . . . 2
Section 2. Appointment of Rights Agent . . . . . . . . . . . . . . 8
Section 3. Issuance of Rights Certificates . . . . . . . . . . . . 8
Section 4. Form of Rights Certificates. . . . . . . . . . . . . . . 11
Section 5. Countersignature and Registration . . . . . . . . . . . 12
Section 6. Transfer, Split Up, Combination and
Exchange of Rights Certificates; Mutilated,
Destroyed, Lost or Stolen Rights Certificates. . . . . . 13
Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 8. Cancellation and Destruction of Rights Certificates . . 17
Section 9. Reservation and Availability of Capital Stock. . . . . . 17
Section 10. Record Date for Securities Issued Upon Exercise . . . . 19
Section 11. Adjustment of Purchase Price, Number and
Kind of Shares or Number of Rights . . . . . . . . . . . 20
Section 12. Certificate of Adjusted Purchase Price or Number of
Shares . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power . . . . . . . . . . . . . . . . . . . . . 30
Section 14. Fractional Rights and Fractional Shares . . . . . . . . 34
Section 15. Rights of Action . . . . . . . . . . . . . . . . . . . . 35
Section 16. Agreement of Rights Holders . . . . . . . . . . . . . . 36
Section 17. Rights Certificate Holder Not Deemed a Shareholder . . . 37
Section 18. Concerning the Rights Agent. . . . . . . . . . . . . . . 37
Section 19. Merger or Consolidation or Change of Name of Rights
Agentt . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 20. Duties of Rights Agent . . . . . . . . . . . . . . . . . 39
Section 21. Change of Rights Agent. . . . . . . . . . . . . . . . . 41
Section 22. Issuance of New Rights Certificates . . . . . . . . . . 42
Section 23. Redemption and Termination. . . . . . . . . . . . . . . 43
Section 24. Notice of Certain Events . . . . . . . . . . . . . . . . 44
Section 25. Notices . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 26. Supplements and Amendments . . . . . . . . . . . . . . . 46
Section 27. Successors. . . . . . . . . . . . . . . . . . . . . . . 47
Section 28. Determinations and Actions by the Board, etc . . . . . . 47
Section 29. Benefits of this Agreement . . . . . . . . . . . . . . . 47
Section 30. Severability . . . . . . . . . . . . . . . . . . . . . . 48
Section 31. Governing Law. . . . . . . . . . . . . . . . . . . . . . 48
Section 32. Counterparts . . . . . . . . . . . . . . . . . . . . . . 48
Section 33. Descriptive Headings. . . . . . . . . . . . . . . . . . 48
Exhibit A - Form of Rights Certificate . . . . . . . . . . . . . . . . A-1
RENEWED RIGHTS AGREEMENT
RENEWED RIGHTS AGREEMENT, dated as of October 21, 1998, between
TECO Energy, Inc., a Florida corporation (the "Company"), and BankBoston,
N.A., a national banking association (the "Rights Agent").
W I T N E S S E T H
WHEREAS, on April 27, 1989, the Board of Directors of the Company
(the "Board") adopted a shareholder rights plan (the "Existing Rights
Plan") and executed a Rights Agreement, dated as of April 27, 1989 between
the Company and the Rights Agent (the "1989 Agreement");
WHEREAS, the Existing Rights Plan is scheduled to expire on
May 7, 1999;
WHEREAS, on October 21, 1998, the Board determined it desirable
and in the best interests of the Company and its shareholders for the
Company to renew the Existing Rights Plan upon its expiration and to
implement such renewal by executing this Agreement (as hereinafter defined)
and declaring the dividend distribution referred to in the fourth WHEREAS
clause herein;
WHEREAS, on October 21, 1998 (the "Rights Dividend Declaration
Date"), the Board authorized and declared a dividend distribution of one
Right (as hereinafter defined) for each share of Common Stock (as
hereinafter defined) of the Company outstanding upon the "Expiration Date"
under the 1989 Agreement (the "Record Date") and authorized the issuance of
one Right (as such number may hereafter be adjusted pursuant to the
provisions of Section 11(i) hereof) for each share of Common Stock of the
Company issued between the Record Date (whether originally issued or
delivered from the Company's treasury) and the Distribution Date (as
hereinafter defined) and under certain circumstances thereafter, each Right
initially representing the right to purchase one share of Common Stock of
the Company, upon the terms and subject to the conditions hereinafter set
forth (each, a "Right");
NOW, THEREFORE, in consideration of the premises and the mutual
agreements set forth herein, 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 Associates and Affiliates (as
hereinafter defined) of such Person, shall be the Beneficial Owner (as
hereinafter defined) of 10% or more of the shares of Common Stock of the
Company then outstanding, but shall not include an Exempt Person (as
hereinafter defined).
(b) "Act" shall mean the Securities Act of 1933, as amended.
(c) "Adjustment Shares" shall have the meaning set forth in
Section 11(a)(ii) hereof.
(d) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act (as hereinafter defined).
(e) "Agreement" shall mean this Renewed Rights Agreement as
originally executed or as it may from time to time be supplemented,
amended, renewed, restated or extended pursuant to the applicable
provisions hereof.
(f) A Person shall be deemed the "Beneficial Owner" of, and
shall be deemed to "beneficially own," any securities:
(i) which such Person or any of such Person's
Associates or Affiliates, directly or indirectly, owns or has the
right to acquire (whether such right is exercisable immediately
or only after the passage of time) pursuant to any agreement,
arrangement or understanding (whether or not in writing) or upon
the exercise of conversion rights, exchange rights, rights,
warrants, options or otherwise; provided, however, that a Person
shall not be deemed the "Beneficial Owner" of, or to
"beneficially own," (A) securities tendered pursuant to a tender
or exchange offer made by or on behalf of such Person or any of
such Person's Associates or Affiliates until such tendered
securities are accepted for purchase or exchange, (B) securities
issuable upon exercise of Rights at any time prior to the
occurrence of a Triggering Event (as hereinafter defined) or (C)
securities issuable upon exercise of Rights from and after the
occurrence of a Triggering Event which Rights are Original Rights
(as hereinafter defined) or securities issued pursuant to Section
11(i) hereof in connection with an adjustment made with respect
to any Original Rights;
(ii) which such Person or any of such Person's
Associates or Affiliates, directly or indirectly, has the right
to vote or dispose of or has "beneficial ownership" of (as
determined pursuant to Rule 13d-3 of the General Rules and
Regulations under the Exchange Act), including pursuant to any
agreement, arrangement or understanding, whether or not in
writing; provided, however, that a Person shall not be deemed the
"Beneficial Owner" of, or to "beneficially own," any security
under this subparagraph (ii) as a result of an agreement,
arrangement or understanding (whether or not in writing) to vote
such security if such agreement, arrangement or understanding:
(A) arises solely from a revocable proxy or consent given in
response to a public proxy or consent solicitation made pursuant
to, and in accordance with, the applicable provisions of the
General Rules and Regulations under the Exchange Act and (B) is
not also then reportable by such Person on Schedule 13D under the
Exchange Act (or any comparable or successor statement); or
(iii) which are beneficially owned, directly or
indirectly, by any other Person (or any Associate or Affiliate
thereof) with which such Person (or any of such Person's
Associates or Affiliates) has any agreement, arrangement or
understanding (whether or not in writing), for the purpose of
acquiring, holding, voting (except pursuant to a revocable proxy
as described in clause (A) of the proviso to subparagraph (ii) of
this paragraph (f)) or disposing of any voting securities of the
Company;
provided, however, that nothing in this paragraph (f) shall cause a Person
engaged in business as an underwriter of securities to be the "Beneficial
Owner" of, or to be deemed to "beneficially own," any securities acquired,
or which that Person has the right to acquire, through such Person's
participation in good faith in a firm commitment underwriting until the
expiration of 40 days after the date of such acquisition.
(g) "Board" shall have the meaning set forth in the first
"WHEREAS" clause at the beginning of this Agreement.
(h) "Business Day" shall mean any day other than a Saturday,
Sunday or day on which banking institutions in the Commonwealth of
Massachusetts are authorized or obligated by law or executive order to
close.
(i) "Close of Business" on any given date shall mean 5:00 P.M.,
Eastern time, on such date; provided, however, that if such date is not a
Business Day, it shall mean 5:00 P.M., Eastern time, on the next succeeding
Business Day
(j) "Common Stock" when used in reference to the Company shall
mean the common stock, par value $1.00 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 in 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 (as hereinafter defined) of another Person, the
capital stock, equity securities of, or other equity interest in, the
Person or Persons which ultimately control such first-mentioned Person and
which has 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
(x) represent the right to participate generally in the profits and losses
of such Person (including without limitation any flow-through tax benefits
resulting from an ownership interest in such Person) and (y) are entitled
to exercise the greatest voting power of such Person or, in the case of a
limited partnership, have the power to remove the general partner or
partners.
(k) "Common Stock Equivalents" shall have the meaning set forth
in Section 11(a)(iii) hereof.
(l) "Company" shall have the meaning set forth in the first
paragraph of this Agreement until a successor corporation or entity shall
have become such or until a Principal Party (as hereinafter defined) shall
assume, and thereafter be liable for, all obligations and duties of the
Company hereunder pursuant to the applicable provisions of this Agreement,
and thereafter, "Company" shall mean such successor or Principal Party,
respectively.
(m) "Current Market Price" shall have the meaning set forth in
Section 11(d) hereof.
(n) "Current Value" shall have the meaning set forth in Section
11(a)(iii) hereof.
(o) "Distribution Date" shall have the meaning set forth in
Section 3(a) hereof.
(p) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
(q) "Exempt Person" shall mean (i) the Company, (ii) any
Subsidiary of the Company, (iii) any employee benefit plan or employee
stock plan of the Company or of any Subsidiary of the Company, (iv) any
Person or entity organized, appointed, established or holding Common Stock
of the Company by, for or pursuant to the terms of any employee benefit
plan or employee stock plan, (v) a Person who (A) is the Beneficial Owner
of less than 15% of the Common Stock of the Company then outstanding and
has reported such ownership on Schedule 13G under the Exchange Act (or any
successor or comparable report) or on Schedule 13D under the Exchange Act
(or any successor or comparable report) which Schedule 13D does not state
any intention to or reserve the right to control or influence the
management or policies of the Company or engage in any of the actions
specified in Item 4 of such Schedule 13D (other than the disposition of
Common Stock of the Company), (B) within ten Business Days (as hereinafter
defined) of being requested by the Company to advise the Company regarding
its intentions, certifies to the Company that such Person acquired shares
of Common Stock of the Company in excess of 9.99% inadvertently or without
knowledge of the terms of the Rights, (C) the Company determines acquired
in excess of 9.99% inadvertently or without knowledge of the terms of the
Rights and (D) together with its Associates and Affiliates, thereafter does
not acquire additional shares of Common Stock of the Company while the
Beneficial Owner of 10% or more of the shares of the Common Stock of the
Company then outstanding or (vi) a Person who, together with its Associates
and Affiliates, becomes the Beneficial Owner of 10% or more of the shares
of Common Stock of the Company then outstanding solely as a result of a
reduction in the number of shares of Common Stock of the Company
outstanding due to the repurchase of shares of Common Stock of the Company
by the Company, unless and until such time as such Person shall purchase or
otherwise become (as a result of actions taken by such Person or its
Associates or Affiliates) the Beneficial Owner of additional shares of
Common Stock of the Company constituting 1% or more of the then outstanding
shares of Common Stock of the Company.
(r) "Existing Rights Plan" shall have the meaning set forth in
the first "WHEREAS" clause hereof.
(s) "Expiration Date" shall have the meaning set forth in
Section 7(a) hereof.
(t) "Final Expiration Date" shall mean the Close of Business on
May 7, 2009.
(u) "Original Rights" shall mean Rights acquired by a Person or
such Person's Associates or Affiliates prior to the Distribution Date or
issued pursuant to Section 3(a) or Section 22 hereof.
(v) "Outside Directors" shall mean the members of the Board who
are not employees of the Company or any of its Subsidiaries and who are not
Acquiring Persons or representatives, nominees, Associates or Affiliates of
any Acquiring Person.
(w) "Person" shall mean any individual, firm, corporation,
partnership, trust or other entity and includes without limitation an
unincorporated group of persons who, by formal or informal agreement or
arrangement (whether or not in writing), have embarked on a common purpose
or act.
(x) "Principal Party" shall have the meaning set forth in
Section 13(b) hereof.
(y) "Purchase Price" shall have the meaning set forth in Section
4(a) hereof.
(z) "Record Date" shall have the meaning set forth in the fourth
"WHEREAS" clause at the beginning of this Agreement.
(aa) "Redemption Price" shall have the meaning set forth in
Section 23(a) hereof.
(bb) "Rights" shall have the meaning set forth in the fourth
"WHEREAS" clause at the beginning of this Agreement.
(cc) "Rights Agent" shall mean the Person named as the "Rights
Agent" in the first paragraph of this Agreement until a successor Rights
Agent shall have become such pursuant to the applicable provisions hereof,
and thereafter "Rights Agent" shall mean such successor Rights Agent. If
at any time there is more than one Person appointed by the Company as
Rights Agent pursuant to the applicable provisions of this Agreement,
"Rights Agent" shall mean and include each such Person.
(dd) "Rights Certificate" shall have the meaning set forth in
Section 3(a) hereof.
(ee) "Rights Dividend Declaration Date" shall have the meaning
set forth in the fourth "WHEREAS" clause at the beginning of this
Agreement.
(ff) "Section 11(a)(ii) Event" shall have the meaning set forth
in Section 11(a)(ii) hereof.
(gg) "Section 11(a)(ii) Trigger Date" shall have the meaning set
forth in Section 11(a)(iii) hereof.
(hh) "Section 13 Event" shall have the meaning set forth in
Section 13(a) hereof.
(ii) "Spread" shall have the meaning set forth in Section
11(a)(iii) hereof.
(jj) "Stock Acquisition Date" shall mean the first date of public
announcement by the Company that an Acquiring Person has become such.
(kk) "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 Associate or Affiliate of such Person.
(ll) "Substitution Period" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(mm) "Summary of Rights" shall have the meaning set forth in
Section 3(b) hereof.
(nn) "Trading Day" shall have the meaning set forth in Section
11(d) hereof.
(oo) "Triggering Event" shall mean any Section 11(a)(ii) Event or
any Section 13 Event.
(pp) "1989 Agreement" shall have the meaning set forth in the
first "WHEREAS" clause at the beginning of this Agreement.
Section 2. Appointment of Rights Agent. The Company has
appointed the Rights Agent to act as agent for the Company and the holders
of the Rights (who, in accordance with Section 3 hereof, shall prior to the
Distribution Date also be the holders of 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, upon ten days'
prior written notice to the Rights Agent. The Rights Agent shall have no
duty to supervise, and in no event shall be liable for, the acts or
omissions of any such Co-Rights Agent. In the event that 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 and
any actions which may be taken by the Rights Agent pursuant to the terms of
this Agreement may be taken by any such Co-Rights Agent.
Section 3. Issuance of Rights Certificates.
(a) Until the earlier of (i) the Close of Business on the tenth
Business Day (or such specified or unspecified later date as may be
determined by the Board before the occurrence of a Distribution Date) after
the Stock Acquisition Date (or, if the tenth Business Day (or such later
date) after the Stock Acquisition Date occurs before the Record Date, the
Close of Business on the Record Date) or (ii) the Close of Business on the
tenth Business Day (or such specified or unspecified later date as may be
determined by the Board before the occurrence of a Distribution Date) after
the date that 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-2(a) of the General Rules and Regulations under the Exchange Act
if upon consummation thereof such Person would be the Beneficial Owner of
10% or more of the shares of Common Stock then outstanding (the earlier of
(i) and (ii) being herein referred to as the "Distribution Date"), (x) the
Rights will be evidenced (subject to the provisions of paragraphs (b) and
(c) of this Section 3) by the certificates for the Common Stock of the
Company registered in the names of the holders thereof (which certificates
for Common Stock 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 (including a transfer to the Company). As soon as practicable
after the Distribution Date, the Rights Agent will send by first-class,
insured, postage prepaid mail, to each record holder of 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
rights certificates, substantially in the form attached hereto as Exhibit A
(each, a "Rights 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(i)
hereof, at the time of distribution of the Rights Certificates, the Company
shall not be required to issue Rights Certificates evidencing fractional
Rights, but may, in lieu thereof, make the necessary and appropriate
rounding adjustments (in accordance with Section 14(a) hereof) so that
Rights Certificates representing only whole numbers of Rights are
distributed and cash is paid in lieu of any fractional Rights. As of and
after the Distribution Date, the Rights will be evidenced solely by such
Rights Certificates.
(b) The Company sent a copy of a Summary of Rights, in
substantially the form attached as Exhibit B to the 1989 Agreement (the
"Summary of Rights"), by first-class, postage prepaid mail, to each record
holder of the Common Stock of the Company as of the Close of Business on
May 8, 1989, at the address of such holder then shown on the records of the
Company. With respect to certificates for the Common Stock of the Company
outstanding as of the Record Date, as set forth in paragraph (a) above,
until the earlier of the Distribution Date or the Expiration Date, the
Rights will be evidenced by (i) such certificates for the Common Stock of
the Company with or without a copy of the Summary of Rights attached or
(ii) certificates for the Common Stock of the Company as legended pursuant
to the terms of the 1989 Agreement or this Agreement, and the registered
holders of the Common Stock of the Company shall also be the registered
holders of the associated Rights. Until the earlier of the Distribution
Date or the Expiration Date, the transfer of any certificates representing
shares of Common Stock of the Company in respect of which Rights have been
issued shall also constitute the transfer of the Rights associated with
such shares of Common Stock of the Company.
(c) Rights shall be issued in respect of all shares of Common
Stock of the Company which are issued (whether originally issued or from
the Company's treasury) after the Record Date but prior to the earlier of
the Distribution Date or the Expiration Date and, to the extent provided in
Section 22 hereof, in respect of shares of Common Stock of the Company
issued after the Distribution Date and prior to the Expiration Date.
Certificates representing such shares of Common Stock of the Company shall
also be deemed to be certificates for Rights, and shall, as promptly as
practicable following the Record Date, bear the following legend:
This certificate also evidences and entitles the
holder hereof to certain Rights as set forth in the
Renewed Rights Agreement between TECO Energy, Inc. (the
"Company") and BankBoston, N.A. (the "Rights Agent")
dated as of October 21, 1998, as the same may be
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 the
Company. 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. The Company will mail to the
holder of this certificate a copy of the Rights
Agreement, as in effect on the date of mailing, without
charge promptly after receipt of a written request
therefor. Under certain circumstances set forth in the
Rights Agreement, Rights beneficially owned (as such
term is defined in the Rights Agreement) by any Person
who is, was or becomes an Acquiring Person or any
Associate or Affiliate of an Acquiring Person (as such
terms are defined in the Rights Agreement), whether
currently held by or on behalf of such Person or by any
subsequent holder, may become null and void. The
Rights shall not be exercisable, and shall be void so
long as held, by a holder in any jurisdiction where the
requisite qualification 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, until
the earlier of (i) the Distribution Date or (ii) the Expiration Date, the
Rights associated with the Common Stock of the Company represented by such
certificates shall be evidenced by such certificates alone and registered
holders of Common Stock of the Company shall also be the registered holders
of the associated 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.
Section 4. Form of Rights Certificates.
(a) The Rights Certificates (and the forms of election to
purchase, assignment and certificate contained therein to be printed on
the reverse thereof) shall each be substantially in the form attached
hereto as Exhibit A and may have such marks of identification or
designation and such legends, summaries or endorsements printed thereon as
the Company may deem appropriate and as are not inconsistent with the
provisions of this Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with
any rule or regulation of any stock exchange on which the Rights may from
time to time be listed, or to conform to usage. Subject to the provisions
of Section 11 and Section 22 hereof, the Rights Certificates, whenever
distributed, shall be dated as of the Record Date and on their face shall
entitle the holders thereof to purchase such number of shares of Common
Stock of the Company as shall be set forth therein at the exercise price
set forth therein (such exercise price per share of Common Stock of the
Company, as adjusted from time to time hereunder, the "Purchase Price"),
but the amount and type of securities purchasable upon the exercise of each
Right and the Purchase Price thereof shall be subject to adjustment as
provided herein.
(b) Any Rights Certificate issued pursuant to Section 3(a) or
Section 22 hereof that represents Rights beneficially owned by: (i) an
Acquiring Person or any Associate or Affiliate of an Acquiring Person; (ii)
a transferee of an Acquiring Person (or of any such Associate or Affiliate)
who becomes a transferee after the Acquiring Person becomes such; or (iii)
a transferee of an Acquiring Person (or of any such Associate or Affiliate)
who becomes a transferee prior to or concurrently with the Acquiring Person
becoming such and receives such Rights pursuant to either (A) a transfer
(whether or not for consideration) from the Acquiring Person to holders of
equity interests in such Acquiring Person or to any Person with whom such
Acquiring Person has any continuing agreement, arrangement or understanding
(whether or not in writing) regarding the transferred Rights or (B) a
transfer which the Board, in its sole discretion, has determined is part of
a plan, arrangement or understanding which has as a primary purpose or
effect avoidance of the provisions of Section 7(e) hereof, and any Rights
Certificate issued pursuant to Section 6 or Section 11 hereof upon
transfer, exchange, replacement or adjustment of any other Rights
Certificate referred to in this sentence, shall contain (to the extent
feasible) the following legend:
The Rights represented by this Rights Certificate are
or were beneficially owned by a Person who is, was or
became an Acquiring Person or an Associate or Affiliate
of an Acquiring Person (as such terms are defined in
the Renewed Rights Agreement). Accordingly, this
Rights Certificate and the Rights represented hereby
may become null and void in the circumstances
specified in Section 7(e) of such Agreement.
Section 5. Countersignature and Registration.
(a) The Rights Certificates shall be executed under seal on
behalf of the Company by its Chairman of the Board, its President or any
Vice President, either manually or by facsimile signature, and by the
Secretary or any Assistant Secretary of the Company, either manually or by
facsimile signature. The Rights Certificates shall be manually
countersigned by an authorized signatory of the Rights Agent and shall not
be valid for any purpose unless so countersigned. In case any officer of
the Company who shall have signed any of the Rights Certificates shall
cease to be such officer of the Company before countersignature by an
authorized signatory of the Rights Agent and issuance and delivery by the
Company, such Rights 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
Rights Certificates had not ceased to be such officer of the Company; and
any Rights Certificate may be signed on behalf of the Company by any person
who, at the actual date of the execution of such Rights Certificate, shall
be a proper officer of the Company to sign such Rights Certificate,
although at the date of the execution of this 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 its principal office or offices designated as the
appropriate place for surrender of Rights Certificates upon exercise or
transfer, books for registration and transfer of the Rights Certificates
issued hereunder. Such books shall show the names and addresses of the
respective holders of the Rights Certificates, the number of Rights
evidenced on its face by each of the Rights Certificates and the date of
each of the Rights Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of
Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights
Certificates.
(a) Subject to the provisions of Section 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 Rights Certificate or Rights Certificates may be
transferred, split up, combined or exchanged for another Rights Certificate
or Rights Certificates entitling the registered holder to purchase a like
number of shares of Common Stock of the Company (or, following the
occurrence of a Triggering Event, other securities, cash or other assets,
as the case may be) as the Rights Certificate or Rights Certificates
surrendered then entitled such holder (or former holder in the case of a
transfer) to purchase. Any registered holder desiring to transfer, split
up, combine or exchange any Rights Certificate or Rights Certificates shall
make such request in writing delivered to the Rights Agent, and shall
surrender the Rights Certificate or Rights Certificates to be transferred,
split up, combined or exchanged, with the forms of assignment and
certificate contained therein duly executed, at the principal 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 Rights
Certificate or Rights Certificates until the registered holder shall have
completed and signed the certificate contained in the form of assignment on
the reverse side of such Rights Certificate or Rights Certificates and
shall have provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Associates or Affiliates
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 Rights Certificate
or Rights Certificates, as the case may be, as so requested. The Company
may require payment from the holder of a Rights 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 Rights
Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a valid Rights Certificate and, in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to them, and
reimbursement to the Company and the Rights Agent of all reasonable
expenses incidental thereto, and upon surrender to the Rights Agent and
cancellation of the Rights Certificate if mutilated, the Company will
execute and deliver a new Rights Certificate of like tenor to the Rights
Agent for countersignature and delivery to the registered owner in lieu of
the Rights Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date
of Rights.
(a) Subject to Section 7(e) hereof, the registered holder of any
Rights Certificate may exercise the Rights evidenced thereby (except as
otherwise provided herein including, without limitation, the restrictions
on exercisability set forth in Section 9(c), Section 11(a)(iii) and Section
23(a) hereof) in whole or in part at any time after the Distribution Date
upon surrender of the Rights Certificate, with the form of election to
purchase and the certificate contained therein duly executed, to the Rights
Agent at the principal office or offices of the Rights Agent designated for
such purpose, together with payment of the aggregate Purchase Price with
respect to the total number of shares of Common Stock of the Company (or,
following the occurrence of a Triggering Event, other securities, cash or
other assets, as the case may be) as to which such surrendered Rights are
then exercisable, at or prior to the earliest of (i) the Final Expiration
Date, (ii) the time at which the Rights are redeemed as provided in Section
23 hereof and (iii) the time at which the Rights expire pursuant to Section
13(d) hereof (the earliest of (i), (ii) and (iii) being herein referred to
as the "Expiration Date").
(b) The Purchase Price for each share of Common Stock of the
Company pursuant to the exercise of a Right shall initially be $90.00,
shall be subject to adjustment from time to time as provided in Sections 11
and 13(a) hereof and shall be payable in accordance with paragraph (c)
below.
(c) Upon receipt of a Rights Certificate representing
exercisable Rights, with the form of election to purchase and the
certificate contained therein duly executed, accompanied by payment, with
respect to each Right so exercised, of the Purchase Price, as such amount
may be reduced pursuant to Section 11(a)(iii) hereof, for each share of
Common Stock of the Company (or, following the occurrence of a Triggering
Event, for other securities, cash or other assets, as the case may be) to
be purchased (as set forth below) and an amount equal to any applicable
transfer tax, the Rights Agent shall, subject to Sections 7(f) and 20(k)
hereof, thereupon promptly (i) requisition from any transfer agent of the
shares of Common Stock of the Company (or make available, if the Rights
Agent is the transfer agent for such shares) certificates for the total
number of shares of Common Stock of the Company to be purchased, and the
Company hereby irrevocably authorizes its transfer agent to comply with all
such requests, (ii) requisition from the Company the amount of cash, if
any, to be paid in lieu of fractional shares in accordance with Section 14
hereof, (iii) after receipt of such certificates, cause the same to be
delivered to, or upon the order of, the registered holder of such Rights
Certificate, registered in such name or names as may be designated by such
holder, and (iv) after receipt thereof, deliver such cash, if any, to, or
upon the order of, the registered holder of such Rights Certificate. The
payment of the Purchase Price (as such amount may be reduced pursuant to
Section 11(a)(iii) hereof) shall be made in cash or by certified check,
cashier's check or bank draft payable to the order of the Company. In the
event that the Company is obligated to issue other securities, pay cash or
distribute other property pursuant to this Section 7(c) or 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. In the event that, immediately
prior to the occurrence of a Distribution Date, the number of shares of
Common Stock of the Company which are authorized by the Company's articles
of incorporation, as amended and in effect at such time, but not
outstanding or reserved for issuance for purposes other than upon exercise
of the Rights is not sufficient to permit exercise in full of the Rights in
accordance with their terms, the Company, acting by resolution of the
Board, shall follow the same procedures and may take any of the same
actions in connection with the exercise of Rights under this Section 7(c)
as are required or permitted to be followed or taken pursuant to Section
11(a)(iii) hereof with respect to substitution of value in connection with
the exercise of Rights under Section 11(a)(ii) hereof. The Company
reserves the right to require, prior to the occurrence of a Triggering
Event that, upon any exercise of Rights, a number of Rights be exercised so
that only whole shares of Common Stock of the Company would be issued.
(d) In case the registered holder of any Rights Certificate
shall exercise less than all of the Rights evidenced thereby, a new Rights
Certificate evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent and delivered to, or upon
the order of, the registered holder of such Rights Certificate, registered
in such name or names as may be designated by such holder, 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, any
Rights beneficially owned by (i) an Acquiring Person or an Associate or
Affiliate of an Acquiring Person which the Board, in its sole discretion,
determines is or was involved in or caused or facilitated, directly or
indirectly (including through any change in the Board), such Section
11(a)(ii) Event, (ii) a transferee of any such Acquiring Person (or of any
such Associate or Affiliate) who becomes a transferee after such Acquiring
Person becomes such or (iii) a transferee of any such Acquiring Person (or
of any such Associate or Affiliate) who becomes a transferee prior to or
concurrently with such Acquiring Person becoming such and receives such
Rights pursuant to either (A) a transfer (whether or not for consideration)
from such Acquiring Person to holders of equity interests in such Acquiring
Person or to any Person with whom such Acquiring Person has any continuing
agreement, arrangement or understanding (whether or not in writing)
regarding the transferred Rights or (B) a transfer which the Board 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 become
null and void without any further action and no holder of such Rights shall
have any rights whatsoever with respect to such Rights, whether under any
provision of this Agreement or otherwise. The 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 Rights Certificates or other Person as a result of its failure to
make any determinations with respect to an Acquiring Person or any of their
Associates, Affiliates or transferees hereunder.
(f) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake
any action with respect to a registered holder of any Rights Certificate
upon the occurrence of any purported assignment or 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 assignment or election to
purchase set forth on the reverse side of the Rights Certificate
surrendered for such assignment or exercise and (ii) provided such
additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Associates or Affiliates thereof as the Company shall
reasonably request.
Section 8. Cancellation and Destruction of Rights Certificates.
All Rights Certificates surrendered for the purpose of exercise, transfer,
split up, combination or exchange shall, if surrendered to the Company or
any of its agents, be delivered to the Rights Agent for cancellation or in
cancelled form, or, if surrendered to the Rights Agent, shall be cancelled
by it, and no Rights Certificates shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Agreement. The
Company shall deliver to the Rights Agent for cancellation and retirement,
and the Rights Agent shall so cancel and retire, any other Rights
Certificate purchased or acquired by the Company otherwise than upon the
exercise thereof. The Rights Agent shall deliver all cancelled Rights
Certificates to the Company, or shall, at the written request of the
Company, destroy such cancelled Rights Certificates and, in such case,
shall deliver a certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Capital Stock.
(a) The Company covenants and agrees that, from and after the
Distribution Date, it will cause to be reserved and kept available out of
its authorized and unissued shares of Common Stock of the Company (and,
following the occurrence of a Triggering Event, other securities) or out of
its authorized and issued shares of Common Stock of the Company held in its
treasury, the number of shares of Common Stock of the Company (and,
following the occurrence of a Triggering Event, the amount of other
securities) that, as provided in this Agreement (including Section
11(a)(iii) hereof) will be sufficient to permit the exercise in full of all
outstanding Rights.
(b) So long as the shares of Common Stock of the Company (and,
following the occurrence of a Triggering Event, other securities) issuable
and deliverable upon the exercise of the Rights may be listed on any
national securities exchange, the Company shall use all reasonable efforts
to cause, from and after such time as the Rights become exercisable, all
shares reserved for such issuance to be listed on such exchange upon
official notice of issuance upon such exercise.
(c) The Company shall use all reasonable efforts to (i) file, as
soon as practicable following the earliest date after the first occurrence
of a Triggering Event in which the consideration to be delivered by the
Company upon exercise of the Rights has been determined in accordance with
this Agreement, or as soon as required by law following the Distribution
Date, as the case may be, a registration statement under the Act on an
appropriate form with respect to the Common Stock of the Company or other
securities purchasable upon exercise of the Rights, (ii) cause such
registration statement to become effective as soon as practicable after
such filing and (iii) cause such registration statement to remain effective
(with a prospectus at all times meeting the requirements of the Act) until
the earlier of (A) the date as of which the Rights are no longer
exercisable for such securities and (B) the Expiration Date. The Company
will also take such action as may be appropriate under, or to ensure
compliance with, the securities or "Blue Sky" laws of the various states
and other jurisdictions in connection with the exercisability of the
Rights. The Company may, acting by resolution of the Board, temporarily
suspend, for a period of time not to exceed 90 days after the date set
forth in clause (i) of the first sentence of this Section 9(c), the
exercisability of the Rights in order to prepare and file such registration
statement and permit it to become effective. 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 shall issue
a public announcement at such time as the suspension is no longer in
effect. In addition, if the Company shall determine that a registration
statement is required in other circumstances following the Distribution
Date, the Company may similarly temporarily suspend the exercisability of
the Rights until such time as a registration statement has been declared
effective. Notwithstanding any provision of this Agreement to the
contrary, the Rights shall not be exercisable in any jurisdiction if the
requisite qualification in such jurisdiction shall not have been obtained
or the exercise thereof shall not otherwise be permitted under applicable
law or a registration statement shall not have been declared effective.
(d) The Company covenants and agrees that it will take all such
action as may be necessary to ensure that all shares of Common Stock of the
Company (and, following the occurrence of a Triggering Event, other
securities) delivered upon exercise of Rights shall, at the time of
delivery of the certificates for such shares (subject to payment of the
Purchase Price), be duly and validly authorized and issued and fully paid
and nonassessable.
(e) The Company further covenants and agrees that, except as set
forth in Section 6(a) hereof and this Section 9(e), it will pay when due
and payable any and all federal and state transfer taxes and charges which
may be payable in respect of the issuance or delivery of the Rights
Certificates and of any certificates for shares of Common Stock of the
Company (or other securities, as the case may be) upon the exercise of
Rights. The Company shall not, however, be required to pay any transfer
tax which may be payable in respect of any transfer or delivery of Rights
Certificates to a Person other than, or the issuance or delivery of a
number of shares of Common Stock of the Company (or other securities, as
the case may be) in respect of a name other than that of, the registered
holder of the Rights Certificates evidencing Rights surrendered for
exercise, nor shall the Company be required to issue or deliver any
certificates for a number of shares of Common Stock of the Company (or
other securities, as the case may be) 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 Rights
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. Record Date for Securities Issued Upon Exercise.
Each Person in whose name any certificate for a number of shares of Common
Stock of the Company (or other securities, as the case may be) is issued
upon the exercise of Rights shall for all purposes be deemed to have become
the holder of record of such shares of Common Stock of the Company (or
other securities, as the case may be) represented thereby on, and such
certificate shall be dated, the date upon which the Rights Certificate
evidencing such Rights was duly surrendered and payment of the Purchase
Price (and all applicable transfer taxes) was made; provided, however, that
if the date of such surrender and payment is a date upon which the transfer
books for the Common Stock of the Company (or other securities, as the case
may be) are closed, such Person shall be deemed to have become the record
holder of such shares (fractional or otherwise) on, and such certificate
shall be dated, the next succeeding Business Day on which the transfer
books for the Common Stock of the Company (or other securities, as the case
may be) are open. Prior to the exercise of the Rights evidenced thereby,
the holder of a Rights Certificate, as such, shall not be entitled to any
rights of a shareholder of the Company (or the Principal Party) 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 not be
entitled to receive any notice of any proceedings of the Company (or the
Principal Party), except as provided herein.
Section 11. Adjustment of Purchase Price, Number and Kind of
Shares or Number of Rights. The Purchase Price, the number and kind of
shares, or fractions thereof, purchasable upon exercise of 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 outstanding shares of Common Stock of the Company payable in
shares of Common Stock of the Company, (B) subdivide or split the
outstanding shares of the Common Stock of the Company, (C)
combine or consolidate the outstanding shares of Common Stock of
the Company into a smaller number of shares or (D) issue any
shares of its capital stock in a reclassification of the Common
Stock of the Company (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
Purchase Price in effect at the time of the record date for such
dividend or of the effective date of such subdivision, split,
combination, consolidation or reclassification, and the number
and kind of shares of Common Stock of the Company (or other
securities, as the case may be) issuable on such date, shall be
proportionately adjusted so that the holder of any Right
exercised after such time shall be entitled to receive, upon
payment of the Purchase Price then in effect, the aggregate
number and kind of shares of Common Stock or capital stock, as
the case may be, which, if such Right had been exercised
immediately prior to such date, whether or not such Right was
then exercisable, and at a time when the transfer books for the
Common Stock (or other capital stock, as the case may be) of the
Company were open, such holder would have owned upon such
exercise and been entitled to receive by virtue of such dividend,
subdivision, split, combination, consolidation or
reclassification. If an event occurs which would require an
adjustment under both this 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) In the event (a "Section 11(a)(ii) Event")
that any Person (other than an Exempt Person), alone or together
with its Associates and Affiliates, shall, at any time after the
Rights Dividend Declaration Date, become the Beneficial Owner of
10% or more of the shares of the Common Stock of the Company then
outstanding, unless the event causing such 10% threshold to be
crossed is (A) a Section 13 Event or (B) is an acquisition of
shares of Common Stock of the Company pursuant to a tender offer
or an exchange offer for all outstanding shares of Common Stock
of the Company at a price and on terms determined by at least a
majority of the Outside Directors, after receiving advice from
one or more investment banking firms, to be (1) at a price that
is fair to shareholders (taking into account all factors which
such Outside Directors deem relevant, including without
limitation prices which could reasonably be achieved if the
Company or its assets were sold on an orderly basis designed to
realize maximum value) and (2) otherwise in the best interests of
the Company and its shareholders, then proper provision shall be
made so that promptly after the date of occurrence of an Section
11(a)(ii) Event, each holder of a Right (except as provided below
and in Section 7(e) hereof) shall thereafter have the right to
receive, upon exercise thereof at the then current Purchase Price
(but in no event less than the par value per share) in accordance
with the terms of this Agreement, such number of shares of Common
Stock of the Company as shall equal the result obtained by (x)
multiplying the then current Purchase Price by the then number of
shares of Common Stock of the Company 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 (y) dividing that product (which following such
first occurrence shall thereafter be referred to as the "Purchase
Price" for each Right and for all purposes of this Agreement) by
50% of the Current Market Price per share of Common Stock of the
Company on the date of such first occurrence (such number of
shares being referred to as the "Adjustment Shares").
(iii) In lieu of issuing shares of Common Stock of
the Company in accordance with Section 11(a)(ii) hereof, the
Company, acting by resolution of the Board, may, and in the event
that the number of shares of Common Stock of the Company which
are authorized by the Company's articles of incorporation 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
resolution of the Board, shall: (A) determine the excess of (1)
the value of the Adjustment Shares issuable upon the exercise of
a Right (the "Current Value") over (2) the Purchase 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 Purchase Price, (1) cash, (2) a reduction in the
Purchase Price (but in no event shall the Purchase Price be less
than the par value per share), (3) equity securities, if any, of
the Company other than Common Stock of the Company (including
without limitation shares, or units of shares, which the Board
has deemed to have the same value as shares of Common Stock of
the Company (such shares being referred to herein as "Common
Stock Equivalents")), (4) debt securities of the Company, (5)
other assets or (6) any combination of the foregoing, which, when
added to any shares of Common Stock of the Company issued upon
such exercise, has an aggregate value equal to the Current Value,
where such aggregate value has been determined by the Board based
upon the advice of a nationally recognized investment banking
firm selected by the Board; provided, however, that if the
Company shall not have made adequate provision to deliver value
pursuant to clause (B) above within 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) hereof, as such date may be extended pursuant to
Section 23(a) hereof or amended pursuant to Section 26 hereof,
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 Purchase Price, shares of
Common Stock of the Company (to the extent available) and then,
if necessary, cash, which shares and cash have an aggregate value
equal to the Spread. If the Board shall determine in good faith
that it is likely that sufficient additional shares of Common
Stock of the Company 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 90
days after the Section 11(a)(ii) Trigger Date, in order that the
Company may seek shareholder 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 need be taken
pursuant to the first 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 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 Common Stock of the Company
shall be the Current Market Price per share of the Common Stock
of the Company on the Section 11(a)(ii) Trigger Date, and the
value of any Common Stock Equivalent shall be deemed to be equal
to the value of the Common Stock of the Company on such date.
(b) In case the Company shall fix a record date for the issuance
of rights, options or warrants to all holders of Common Stock of the
Company entitling them to subscribe for or purchase (for a period expiring
within 45 calendar days after such record date) Common Stock of the Company
or securities convertible into Common Stock of the Company or Common Stock
Equivalents at a price per share of Common Stock of the Company or per
share of Common Stock Equivalents (or having a conversion price per share,
if a security convertible into Common Stock of the Company or Common Stock
Equivalents) less than the Current Market Price per share of Common Stock
of the Company on such record date, except as otherwise provided in Section
11(a) and Section 7(e) hereof, the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price in
effect immediately prior to such record date by a fraction, the numerator
of which shall be the sum of (i) the number of shares of Common Stock of
the Company or Common Stock Equivalents outstanding on such record date,
(ii) the number of shares of Common Stock of the Company or Common Stock
Equivalents underlying securities outstanding on such record date which are
convertible into Common Stock of the Company or Common Stock Equivalents
and (iii) the number of shares of Common Stock of the Company which the
aggregate subscription price of the total number of shares of Common Stock
of the Company or Common Stock Equivalents so to be offered (or the
aggregate initial conversion price of the convertible securities so to be
offered) would purchase at such Current Market Price, and the denominator
of which shall be the sum of (i) the number of shares of Common Stock of
the Company outstanding on such record date, (ii) the number of shares of
Common Stock of the Company or Common Stock Equivalents underlying
securities outstanding on such record date which are convertible into
Common Stock of the Company or Common Stock Equivalents and (iii) the
number of additional shares of Common Stock of the Company or Common Stock
Equivalents to be offered for subscription or purchase (or into which the
convertible securities so to be offered are initially convertible). In
case such subscription price may be paid by delivery of consideration part
or all of which may be in a form other than cash, the value of such
consideration shall be as determined in good faith by the Board, which
determination shall be described in a statement filed with the Rights Agent
and shall be conclusive for all purposes. Shares of Common Stock of the
Company owned by or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such adjustment shall
be made successively whenever such a record date is fixed, and in the event
that such rights, options or warrants are not so issued, the Purchase Price
shall be adjusted to be the Purchase Price which would then be in effect if
such record date had not been fixed.
(c) In case the Company shall fix a record date for a
distribution to all holders of Common Stock of the Company (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 Common Stock of the Company, but including any dividend
payable in stock other than Common Stock of the Company) or subscription
rights or warrants (excluding those referred to in Section 11(b) hereof),
except as otherwise provided in Section 11(a) and Section 7(e) hereof, the
Purchase Price to be in effect after such record date shall be determined
by multiplying the Purchase Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the Current
Market Price per share of Common Stock of the Company on such record date,
less the fair market value (as determined in good faith by the Board, which
determination shall be described in a statement filed with the Rights Agent
and shall be conclusive for all purposes) of the portion of the cash,
assets or evidences of indebtedness so to be distributed or of such
subscription rights or warrants applicable to a share of Common Stock of
the Company and the denominator of which shall be such Current Market Price
per share of Common Stock of the Company. Such adjustments shall be made
successively whenever such a record date is fixed, and in the event that
such distribution is not so made, the Purchase Price shall be adjusted to
be the Purchase Price which would have been in effect if such record date
had not been fixed.
(d) For the purpose of any computation hereunder, other than
computations made pursuant to Section 11(a)(iii) hereof, the "Current
Market Price" per share of Common Stock on any date shall be deemed to be
the average of the daily closing prices per share of such Common Stock for
the 30 consecutive Trading Days immediately prior to such date, and for
purposes of computations made pursuant to Section 11(a)(iii) hereof, the
Current Market Price per share of Common Stock on any date shall be deemed
to be the average of the daily closing prices per share of such Common
Stock for the 10 consecutive Trading Days immediately following such date;
provided, however, that in the event that the Current Market Price per
share of the Common Stock is determined during a period following the
announcement by the issuer of such Common Stock of (A) a dividend or
distribution on such Common Stock payable in shares of such Common Stock or
securities convertible into shares of such Common Stock (other than the
Rights) or (B) any subdivision, combination, consolidation, reverse stock
split or reclassification of such Common Stock, and prior to the expiration
of the requisite 30-Trading Day or 10-Trading Day period, as set forth
above, after the ex-dividend date for such dividend or distribution, or the
record date for such subdivision, combination, consolidation, reverse stock
split, or reclassification, then, and in each such case, the Current Market
Price 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 shares of Common Stock are not listed or admitted to trading on the
New York Stock Exchange, as reported in the principal consolidated
transaction reporting system or as quoted by the Nasdaq National Market
with respect to securities listed or admitted to trading on another
national securities exchange or quoted by the Nasdaq National Market,
respectively, or, if the shares of Common Stock are not listed or admitted
to trading on any national securities exchange or quoted by the Nasdaq
National Market, the last quoted price or, if not so quoted, the average of
the high bid and low asked prices in the over-the-counter market, as
reported by The Nasdaq Stock Market or such other quotation system then in
use or, if on any such date the shares of Common Stock are not quoted by
any such organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the Common
Stock selected by the Board. If on any such date the Common Stock is not
publicly held or not so listed, admitted to trading or quoted, and no
market maker is making a market in such Common Stock, Current Market Price
shall mean the fair value of such shares on such date as determined in good
faith by the Board, which determination shall be described in a statement
filed with the Rights Agent and shall be conclusive for all purposes. The
term "Trading Day" shall mean a day on which the principal national
securities exchange on which the shares of Common Stock are listed or
admitted to trading is open for the transaction of business or, if the
shares of Common Stock are not listed or admitted to trading on any
national securities exchange, a Business Day.
(e) Anything herein to the contrary notwithstanding, no
adjustment in the Purchase Price shall be required unless such adjustment
would require an increase or decrease of at least one percent in the
Purchase 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
ten-thousandth of a share of Common Stock of the Company, as the case may
be. 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 years from the date of the transaction which mandates
such adjustment or (ii) the Expiration Date.
(f) If as a result of an adjustment made pursuant to Section
11(a)(ii) or Section 13(a) hereof, the holder of any Right thereafter
exercised shall become entitled to receive any shares of capital stock
other than Common Stock of the Company, thereafter the number of such other
shares so receivable upon exercise of any Right and the Purchase Price
thereof (or the number of Rights) shall be subject to adjustment from time
to time in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Common Stock of the Company contained in
Sections 11(a), (b), (c), (e), (g), (h), (i), (j), (k), (l) and (m) hereof,
and the provisions of Sections 7, 9, 10, 13 and 14 hereof with respect to
the Common Stock of the Company shall apply on like terms to any such other
shares; provided, however, that the Company shall not be liable for its
inability to reserve and keep available for issuance upon exercise of the
Rights pursuant to Section 11(a)(ii) hereof a number of shares of Common
Stock of the Company greater than the number then authorized by the
Company's articles of incorporation, but not outstanding or reserved for
any other purpose.
(g) All Rights originally issued by the Company subsequent to
any adjustment made to the Purchase Price hereunder shall evidence the
right to purchase, at the adjusted Purchase Price, the number of shares of
Common Stock of the Company 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) hereof, upon each adjustment of the Purchase
Price as a result of the calculations made in Sections 11(b) and (c)
hereof, each Right outstanding immediately prior to the making of such
adjustment shall thereafter evidence the right to purchase, at the adjusted
Purchase Price, that number of shares of Common Stock of the Company
(calculated to the nearest ten-thousandth of a share) obtained by (i)
multiplying (x) the number of shares of Common Stock of the Company covered
by a Right immediately prior to this adjustment by (y) the Purchase Price
in effect immediately prior to such adjustment of the Purchase Price, and
(ii) dividing the product so obtained by the Purchase Price in effect
immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any adjustment
of the Purchase Price to adjust the number of Rights, in lieu of any
adjustment in the number of shares of Common Stock of the Company
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 shares of Common Stock of the Company 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-thousandth of a Right)
obtained by dividing the Purchase Price in effect immediately prior to
adjustment of the Purchase Price by the Purchase Price in effect
immediately after adjustment of the Purchase Price. The Company shall make
a public announcement of its election to adjust the number of Rights,
indicating the record date for the adjustment, and, if known at the time,
the amount of the adjustment to be made. This record date may be the date
on which the Purchase Price is adjusted or any day thereafter, but, if the
Rights Certificates have been issued, shall be at least 10 days later than
the date of the public announcement. If Rights Certificates have been
issued, upon each adjustment of the number of Rights pursuant to this
Section 11(i), the Company shall, as promptly as practicable, cause to be
distributed to holders of record of Rights Certificates on such record date
Rights Certificates evidencing, subject to Section 14 hereof, the
additional Rights to which such holders shall be entitled as a result of
such adjustment or, at the option of the Company, shall cause to be
distributed to such holders of record in substitution and replacement for
the Rights Certificates held by such holders prior to the date of
adjustment and upon surrender thereof, if required by the Company, new
Rights Certificates evidencing all the Rights to which such holders shall
be entitled after such adjustment. Rights Certificates so to be
distributed shall be issued, executed and countersigned in the manner
provided for herein (and may bear, at the option of the Company, the
adjusted Purchase Price) and shall be registered in the names of the
holders of record of Rights Certificates on the record date specified in
the public announcement.
(j) Irrespective of any adjustment or change in the Purchase
Price or the number of shares of Common Stock of the Company issuable upon
the exercise of the Rights, the Rights Certificates theretofore and
thereafter issued may continue to express the Purchase Price per share of
Common Stock of the Company and the number of shares of Common Stock of the
Company which were expressed in the initial Rights Certificates issued
hereunder.
(k) Before taking any action that would cause an adjustment
reducing the Purchase Price below the par value, if any, of the number of
shares of Common Stock of the Company issuable upon exercise of the Rights,
the Company shall use all reasonable efforts to 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, such
number of shares of Common Stock of the Company at such adjusted Purchase
Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for
a specified event, the Company may elect to defer until the occurrence of
such event the issuance to the holder of any Right exercised after such
record date of the number of shares of Common Stock of the Company or other
capital stock or securities of the Company, if any, issuable upon such
exercise over and above the number of shares of Common Stock of the Company
or other capital stock or securities of the Company, if any, issuable upon
such exercise on the basis of the Purchase Price in effect prior to such
adjustment; provided, however, that the Company shall deliver to such
holder a due ▇▇▇▇ or other appropriate instrument evidencing such holder's
right to receive such additional shares (fractional or otherwise) or
securities 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 adjustments in the Purchase
Price, in addition to those adjustments expressly required by this Section
11, as and to the extent that in its good faith judgment the Board shall
determine to be advisable in order that any (i) consolidation or
subdivision of the Common Stock of the Company, (ii) issuance wholly for
cash of any shares of Common Stock of the Company at less than the Current
Market Price, (iii) issuance wholly for cash of shares of Common Stock of
the Company or securities which by their terms are convertible into or
exchangeable for shares of Common Stock of the Company, (iv) stock
dividends or (v) issuance of rights, options or warrants referred to in
this Section 11, hereafter made by the Company to holders of its Common
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, (i) consolidate with any other Person
(other than a Subsidiary of the Company in a transaction which complies
with Section 11(o) hereof), (ii) merge with or into any other Person (other
than a Subsidiary of the Company in a transaction which complies with
Section 11(o) hereof) or (iii) sell or transfer (or permit any Subsidiary
to sell or transfer), in one transaction or a series of related
transactions, assets or earning power aggregating more than 50% of the
assets or earning power of the Company and its Subsidiaries (taken as a
whole) to any other Person or Persons (other than the Company or any of its
Subsidiaries in one or more transactions each of which complies with
Section 11(o) hereof) if (x) at the time of or immediately after such
consolidation, merger, sale or transfer there are any rights, warrants or
other instruments or securities outstanding or agreements in effect which
would substantially diminish or otherwise eliminate the benefits intended
to be afforded by the Rights or (y) prior to, simultaneously with or
immediately after such consolidation, merger, sale or transfer, the
shareholders of the Person who constitutes, or would constitute, the
"Principal Party" for purposes of Section 13(a) hereof shall have received
a distribution of Rights previously owned by such Person or any of its
Associates and Affiliates.
(o) The Company covenants and agrees that, after the
Distribution Date, it will not, except as permitted by Section 23 or
Section 26 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 diminish substantially or otherwise eliminate the benefits intended to
be afforded by the Rights.
Section 12. Certificate of Adjusted Purchase 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 Common Stock of the Company, a copy of such
certificate and (c) mail a brief summary thereof to each record holder of a
Rights Certificate (or, if prior to the Distribution Date, to each record
holder of a certificate representing shares of Common Stock of the Company)
in accordance with Section 24 hereof. Notwithstanding the foregoing
sentence, the failure of the Company to prepare such certificate or
statement or make such filings or mailings shall not affect the validity
of, or the force or effect of, the requirement for such adjustment. The
Rights Agent shall be fully protected in relying on any such certificate
and on any adjustment therein contained and shall not be deemed to have
knowledge of 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 (a "Section 13 Event") that, on or after the
Stock Acquisition Date, directly or indirectly, (x) the Company shall
consolidate or otherwise combine with, or merge with or into, any other
Person or Persons (other than a Subsidiary of the Company in a transaction
which complies with Section 11(o) hereof) and the Company shall not be the
continuing or surviving corporation of such consolidation, combination or
merger, (y) any Person or Persons (other than a Subsidiary of the Company
in a transaction which complies with Section 11(o) hereof) shall
consolidate or otherwise combine with, or merge with or into, the Company
and the Company shall be the continuing or surviving corporation of such
consolidation, combination or merger and, in connection with such
consolidation, combination or merger, all or part of the outstanding shares
of Common Stock of the Company shall be changed into or exchanged for stock
or other securities of any other Person or Persons or cash or any other
property or (z) the Company shall sell or otherwise transfer (or one or
more of its Subsidiaries shall sell or otherwise transfer), in one
transaction or a series of related transactions, assets or earning power
aggregating more than 50% of the assets or earning power of the Company and
its Subsidiaries (taken as a whole and calculated on the basis of the
Company's most recent regularly prepared financial statements) to any
Person or Persons (other than the Company or any Subsidiary of the Company
in one or more transactions each of which complies with Section 11(o)
hereof); provided, however, that this clause (z) of Section 13(a) hereof
shall not apply to the pro rata distribution by the Company of assets
(including securities) of the Company or any of its Subsidiaries to all
holders of Common Stock of the Company; then, and in each such case (except
as may be contemplated by Section 13(d) hereof), proper provision shall be
made so that: (i) each holder of a Right, except as provided in Section
7(e) hereof, shall, on or after the later of (A) the date of the first
occurrence of any such Section 13 Event or (B) the date of the expiration
of the period within which the Rights may be redeemed pursuant to Section
23 hereof (as the same may be extended pursuant to Section 23(a) hereof or
amended pursuant to Section 26 hereof), thereafter have the right to
receive, upon the exercise thereof at the then current Purchase Price in
accordance with the terms of this Agreement, such number of validly
authorized and issued, fully paid, nonassessable and freely tradeable
shares of Common Stock of the Principal Party, not subject to any liens,
encumbrances, rights of first refusal or other adverse claims, as shall be
equal to the result obtained by (1) multiplying the then current Purchase
Price by the number of shares of Common Stock of the Company for which a
Right is exercisable immediately prior to the first occurrence of a Section
13 Event (or, if a Section 11(a)(ii) Event has occurred prior to the first
occurrence of a Section 13 Event, multiplying the number of such shares of
Common Stock of the Company for which a Right was exercisable immediately
prior to the first occurrence of a Section 11(a)(ii) Event by the Purchase
Price in effect immediately prior to such first occurrence), and (2)
dividing that product (which, following the first occurrence of a Section
13 Event, shall be referred to as the "Purchase Price" for each Right and
for all purposes of this Agreement) by 50% of the Current Market Price per
share of the Common Stock of such Principal Party on the date of
consummation of such Section 13 Event; (ii) the shares of Common Stock of
such Principal Party received by each holder of a Right upon exercise of
that Right shall be fully paid and nonassessable; (iii) such Principal
Party shall thereafter be liable for, and shall assume, by virtue of such
Section 13 Event, all the obligations and duties of the Company pursuant to
this Agreement; (iv) 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 only to such Principal Party following the
first occurrence of a Section 13 Event; (v) such Principal Party shall take
such steps (including without limitation the reservation of a sufficient
number of shares of its Common Stock) in connection with the consummation
of any such transaction as may be necessary to assure that the provisions
hereof shall thereafter be applicable, as nearly as reasonably may be, in
relation to its shares of Common Stock thereafter deliverable upon the
exercise of the Rights; and (vi) the provisions of Section 11(a)(ii) hereof
shall be of no effect following the first occurrence of any Section 13
Event.
(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) hereof,
(A) the Person that is the issuer of any securities into which
shares of Common Stock of the Company are converted, changed or
exchanged in such merger, consolidation or combination (or, if
there is more than one such issuer, the issuer the Common Stock
of which has the greatest market value) or (B) if no securities
are so issued, the Person that is the other party to such merger
(and survives the merger), consolidation or combination (or, if
there is more than one such Person, the Person the Common Stock
of which has the greatest market value), or if the other party to
the merger does not survive the merger, the Person that does
survive the merger (including the Company, if it survives); and
(ii) in the case of any transaction described in
clause (z) of the first sentence of Section 13(a) hereof, 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 so transferred or if the Person receiving
the greatest portion of the assets or earning power cannot be
determined, whichever of such Persons is the issuer of Common
Stock having the greatest market value;
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, and such
Person is a direct or indirect Subsidiary of another Person the Common
Stock of which is and has been so registered, "Principal Party" shall refer
to such other Person; (2) if the Common Stock of such Person is not and has
not been so registered and such Person is a Subsidiary, directly or
indirectly, of more than one Person, the Common Stocks of two or more of
which are and have been so registered, "Principal Party" shall refer to
whichever of such Persons is the issuer of the Common Stock having the
greatest aggregate market value; and (3) if the Common Stock of such Person
is not and has not been so registered and such Person is owned, directly or
indirectly, by a joint venture formed by two or more Persons that are not
owned, directly or indirectly, by the same Person, the rules set forth in
(1) and (2) above shall apply to each of the chains of ownership having an
interest in such joint venture as if such party were a Subsidiary of both
or all of such joint venturers, and the Principal Parties in each such
chain shall bear the obligations set forth in this Section 13 in the same
ratio as their direct or indirect interests in such Person bear to the
total of such interests.
(c) The Company shall not consummate any Section 13 Event unless
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 unless prior thereto the Company and such Principal Party shall have
executed and delivered to the Rights Agent a supplemental agreement
confirming that the requirements of Section 13(a) and Section 13(b) hereof
shall promptly be performed in accordance with their terms and that such
Section 13 Event shall not result in a default by the Principal Party under
this Agreement as the same shall have been assumed by the Principal Party
pursuant to Section 13(a), Section 13(b) hereof and further providing that,
as soon as practicable after the date of any such Section 13 Event, the
Principal Party will:
(i) prepare and file a registration statement
under the Act with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form,
and will use its best efforts to cause such registration
statement to (A) become effective as soon as practicable after
such filing and (B) remain effective (with a prospectus at all
times meeting the requirements of the Act) until the Expiration
Date and to similarly comply with applicable state securities
laws;
(ii) use its best efforts to list or obtain
quotation of (or continue the listing or quotation of) the Rights
and the securities purchasable upon exercise of the Rights on a
national securities exchange or by an automated quotation
service;
(iii) 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 (or any successor form) under the
Exchange Act; and
(iv) use its best efforts to obtain waivers of
any rights of first refusal or preemptive rights in respect of
the shares of Common Stock of the Principal Party subject to
purchase upon exercise of outstanding Rights.
The provisions of this Section 13 shall similarly apply to successive
mergers, consolidations, combinations or sales or other transfers. In the
event that a Section 13 Event shall occur at any time after the occurrence
of a Section 11(a)(ii) Event, the Rights which have not theretofore been
exercised shall thereafter become exercisable in the manner described in
Section 13(a) hereof.
(d) Notwithstanding anything in this Agreement to the contrary,
Section 13 hereof shall not be applicable to a transaction described in
subparagraph (x) or subparagraph (y) of Section 13(a) hereof if (i) such
transaction is consummated with a Person or Persons (or a wholly owned
Subsidiary of any such Person or Persons) who acquired shares of Common
Stock of the Company pursuant to a tender offer or exchange offer for all
outstanding shares of Common Stock of the Company which complies with the
exception provided for in Section 11(a) (ii) hereof, (ii) the price per
share of Common Stock of the Company offered in such transaction is not
less than the price per share of Common Stock of the Company paid to all
holders of shares of Common Stock of the Company whose shares were
purchased pursuant to such tender offer or exchange offer and (iii) the
form of consideration being offered to the remaining holders of shares of
Common Stock of the Company pursuant to such transaction is the same as the
form of consideration paid pursuant to such tender offer or exchange offer.
Upon consummation of any such transaction contemplated by this Section
13(d), all Rights hereunder shall expire.
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(i)
hereof, or to distribute Rights Certificates which evidence fractional
Rights. In lieu of any such fractional Rights, there shall be paid to the
registered holders of the Rights Certificates with regard to which such
fractional Rights would otherwise be issuable, an amount in cash equal to
the same fraction of the current market value of a whole Right. For
purposes of this Section 14(a), the current market value of a whole Right
shall be the closing price of the Rights for the Trading Day immediately
prior to the date on which such fractional Rights would have been otherwise
issuable. The closing price of the Rights for any Trading Day shall be the
last sale price, regular way, or, in case no such sale takes place on such
day, the average of the closing bid and asked prices, regular way, in
either case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the New
York Stock Exchange or, if the Rights are not listed or admitted to trading
on the New York Stock Exchange, as reported in the principal consolidated
transaction reporting system or the Nasdaq National Market with respect to
securities listed on another principal national securities exchange or
quoted by the Nasdaq National Market, respectively, or if the Rights are
not listed or admitted to trading on any national securities exchange or
quoted by the Nasdaq National Market, the last quoted price or, if not so
quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by The Nasdaq Stock Market or such
other quotation system then in use or, if on any such date the Rights are
not quoted by any such organization, the average of the closing bid and
asked prices as furnished by a professional market maker making a market in
the Rights selected by the Board. If on any such date no such market maker
is making a market in the Rights, the fair value of the Rights on such date
as determined in good faith by the Board, shall be used.
(b) The Company shall not be required to issue fractions of
shares of Common Stock of the Company upon exercise of the Rights or to
distribute certificates which evidence fractional shares of Common Stock of
the Company. In lieu of fractional shares of Common Stock of the Company,
the Company may pay to the registered holders of Rights Certificates at the
time such Rights are exercised as herein provided an amount in cash equal
to the same fraction of the current market value of one share of Common
Stock of the Company. For purposes of this Section 14(b), the current
market value of one share of Common Stock of the Company shall be the
closing price of one share of Common Stock of the Company, or if
unavailable, the appropriate alternative price (in each case, as 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 that Right
expressly waives such holder's right to receive any fractional Rights or
any fractional shares upon exercise of a Right, except as permitted by this
Section 14.
Section 15. Rights of Action. All rights of action in respect
of this Agreement, other than rights of action vested in the Rights Agent
in Section 18 hereof, are vested in the respective registered holders of
the Rights Certificates (and, prior to the Distribution Date, the
registered holders of the Common Stock of the Company); and any registered
holder of any Rights 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 Rights Certificate (or, prior to the
Distribution Date, of the Common Stock of the Company), may, in the
holder's own behalf and for the 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, the holder's right to exercise
the Rights evidenced by such Rights Certificate in the manner provided in
such Rights Certificate and in this Agreement. Without limiting the
foregoing or any remedies available to the holders of Rights, it is
specifically acknowledged that the holders of Rights would not have an
adequate remedy at law for any breach of this Agreement and shall be
entitled to specific performance of the obligations hereunder and
injunctive relief against actual or threatened violations of the
obligations hereunder of any Person subject to this Agreement.
Section 16. Agreement of Rights Holders. Every holder of a
Right, by accepting the same, consents and agrees with the Company and the
Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of shares of Common Stock
of the Company;
(b) after the Distribution Date, the Rights Certificates are
transferable only on the registry books of the Rights Agent if surrendered
at the principal office or offices of the Rights Agent designated for such
purposes, duly endorsed or accompanied by a proper instrument of transfer
and with the appropriate forms and certificates contained therein duly
executed;
(c) subject to Section 6(a) and Section 7(f) hereof, the Company
and the Rights Agent may deem and treat the person in whose name a Rights
Certificate (or, prior to the Distribution Date, the associated certificate
for 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 Rights Certificate or the associated
certificate for Common Stock of the Company made by anyone other than the
Company or the Rights Agent) for all purposes whatsoever, and neither the
Company nor the Rights Agent, subject to the last sentence of Section 7(e)
hereof, shall be required to be affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any
holder of a Right or other Person as a result of its inability to perform
any of its obligations under this Agreement by reason of any preliminary or
permanent injunction or other order, decree or ruling issued by a court of
competent jurisdiction or by a governmental, regulatory or administrative
agency or commission, or by reason of any statute, rule, regulation or
executive order promulgated or enacted by any governmental authority,
prohibiting or otherwise restraining performance of such obligation;
provided, however, that the Company must use its reasonable efforts to have
any such order, decree or ruling lifted or otherwise overturned as soon as
possible.
Section 17. Rights Certificate Holder Not Deemed a Shareholder.
No holder, as such, of any Rights Certificate shall be entitled to vote,
receive dividends or be deemed for any purpose the holder of the number of
shares of Common Stock of the Company or any other securities of the
Company which may at any time be issuable upon the exercise of the Rights
represented thereby, nor shall anything contained herein or in any Rights
Certificate be construed to confer upon the holder of any Rights
Certificate, as such, any of the rights of a 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 24 hereof),
or to receive dividends or subscription rights, or otherwise, until the
Right or Rights evidenced by such Rights Certificate shall have been
exercised in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from time to
time, on demand of the Rights Agent, reimbursement for its reasonable
expenses and counsel fees and disbursements and other disbursements
incurred in the administration and execution of this Agreement and the
exercise and performance of its duties hereunder. The Company also agrees
to indemnify the Rights Agent for, and to hold it harmless against, any
loss, liability, or expense, incurred without gross negligence, bad faith
or willful misconduct on the part of the Rights Agent, for anything done or
omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the costs and expenses of
defending against any claim of liability in the premises.
(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 good faith in connection with its administration of this Agreement in
reliance upon any Rights Certificate or certificate for Common Stock of the
Company or for other securities of the Company or upon any instrument of
assignment or transfer, power of attorney, endorsement, affidavit, letter,
notice, direction, consent, certificate, statement or other paper or
document reasonably believed by it to be genuine and to be signed, executed
and, where necessary, verified or acknowledged, by the proper Person or
Persons.
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 stock transfer business of the Rights
Agent or any successor Rights Agent, shall be the successor to the Rights
Agent under this Agreement without the execution or filing of any paper or
any further act on the part of any of the parties hereto; provided,
however, that such corporation would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21 hereof. If at
the time such successor Rights Agent shall succeed to the agency created by
this Agreement, any of the Rights Certificates shall have been
countersigned but not delivered, any such successor Rights Agent may adopt
the countersignature of a predecessor Rights Agent and deliver such Rights
Certificates so countersigned; and if at that time any of the Rights
Certificates shall not have been countersigned, any successor Rights Agent
may countersign such Rights Certificates either in the name of the
predecessor or in the name of the successor Rights Agent; and in all such
cases such Rights Certificates shall have the full force provided in the
Rights Certificates and in this Agreement.
(b) If at any time the name of the Rights Agent shall be changed
and at such time any of the Rights Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the
countersignature under its prior name and deliver Rights Certificates so
countersigned; and if at that time any of the Rights Certificates shall not
have been countersigned, the Rights Agent may countersign such Rights
Certificates either in its prior name or in its changed name; and in all
such cases such Rights Certificates shall have the full force provided in
the Rights Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes
the duties and obligations imposed by this Agreement upon the following
terms and conditions, by all of which the Company and the holders of Rights
Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may be
legal counsel for the Company), and the opinion of such counsel shall be
full and complete authorization and protection to the Rights Agent as to
any action taken or omitted by it in good faith and in accordance with such
opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or desirable that any
fact or matter (including without limitation the identity of any Acquiring
Person and the determination of Current Market Price) be proved or
established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by the Chairman of the Board, the
President, any Vice President, the Treasurer, any Assistant Treasurer, the
Secretary or any Assistant Secretary of the Company and delivered to the
Rights Agent; and such certificate shall be full authorization to the
Rights Agent for any action taken or suffered in good faith by it under the
provisions of this Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its own
gross negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any
of the statements of fact or recitals contained in this Agreement or in the
Rights Certificates, nor shall it be required to verify the same (except as
to its countersignature on such Rights Certificates), but all such
statements and recitals are and shall be deemed to have been made by the
Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery
hereof (except the due execution hereof by the Rights Agent) or in respect
of the validity or execution of any Rights Certificate (except its
countersignature thereon); nor shall it be responsible for any breach by
the Company of any covenant or condition contained in this Agreement or in
any Rights Certificate; nor shall it be responsible for any adjustment
required under the provisions of Section 11 or Section 13 hereof or
responsible for the manner, method or amount of any such adjustment or the
ascertaining of the existence of facts that would require any such
adjustment (except with respect to the exercise of Rights evidenced by
Rights Certificates after receipt of a certificate describing any such
adjustment); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any
shares of Common Stock of the Company to be issued pursuant to this
Agreement or any Rights Certificate or as to whether any shares of Common
Stock of the Company will, when so issued, be validly authorized and
issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed, acknowledged
and delivered all such further and other acts, instruments and assurances
as may reasonably be required by the Rights Agent for the carrying out or
performing by the Rights Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from
the Chairman of the Board, the President, any Vice President, the
Secretary, any Assistant Secretary, the Treasurer or any Assistant
Treasurer of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable for
any action taken or suffered to be taken by it in good faith in accordance
with instructions of any such officer. 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 by, or omission
of, the Rights Agent under this Agreement and the date on or after which
such action shall be taken or such omission shall be effective. The Rights
Agent shall not be liable for any action taken by, or omission of, the
Rights Agent in accordance with a proposal included in any such application
on or after the date specified in such application (which date shall not be
less than five Business Days after the date the Company actually receives
such application, unless the Company shall have consented in writing to an
earlier date) unless, prior to taking any such action (or prior to 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.
(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, become pecuniarily interested in any
transaction in which the Company may be interested, contract with or lend
money to the Company or otherwise act as fully and freely as though the
Rights Agent were not Rights Agent under this Agreement. Nothing herein
shall preclude the Rights Agent from acting in any other capacity for the
Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights
or powers hereby vested in it or perform any duty hereunder either itself
or by or through its attorneys or agents, and the Rights Agent shall not be
answerable or accountable for any act, default, neglect or misconduct of
any such attorneys or agents or for any loss to the Company resulting from
any such act, default, neglect or misconduct; provided, however, reasonable
care was exercised in the selection and continued employment thereof.
(j) No provision of this Agreement shall require the Rights
Agent to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder (other than
internal costs incurred by the Rights Agent in providing services to the
Company in the ordinary course of its business as Rights Agent) 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 Rights Certificate surrendered to
the Rights Agent for exercise or transfer, the certificate contained in 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 30 days' notice in writing mailed to the Company and to
each transfer agent of the Common Stock of the Company, by registered or
certified mail and to the holders of the Rights Certificates, if any, by
first-class mail. The Company may remove the Rights Agent or any successor
Rights Agent upon 30 days' notice in writing mailed to the Rights Agent or
successor Rights Agent, as the case may be, and to each transfer agent of
the Common Stock of the Company, by registered or certified mail and to the
holders of the Rights Certificates, if any, by first-class mail. If the
Rights Agent shall resign or be removed or shall otherwise become incapable
of acting, the Company shall appoint a successor to the Rights Agent. If
the Company shall fail to make such appointment within a period of 30 days
after giving notice of such removal or after it has been notified in
writing of such resignation or incapacity by the resigning or incapacitated
Rights Agent or by the holder of a Rights Certificate (who shall, with such
notice, submit his Rights Certificate for inspection by the Company), then
any registered holder of any Rights Certificate may apply to any court of
competent jurisdiction for the appointment of a new Rights Agent. If no
successor Rights Agent shall have been appointed within 30 days from the
effectiveness of such removal, resignation or incapacity and no registered
holder of any Rights Certificate has applied pursuant to this Agreement for
the appointment of a new Rights Agent, the Company automatically shall be
designated as successor Rights Agent. Any successor Rights Agent 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 any state of the
United States, in good standing, which is authorized to do business as a
banking institution in such state, is authorized under such laws to
exercise corporate trust powers, is subject to supervision or examination
by federal or state authority and has at the time of its appointment as
Rights Agent a combined capital and surplus of at least $100,000,000 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 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 shall execute and deliver, if
applicable, any further assurance, conveyance, act or deed necessary for
that 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
shall mail a notice thereof in writing to the registered holders of the
Rights Certificates, if any. Failure to give any notice provided for in
this Section 21, however, or any defect therein, shall not affect the
legality or validity of the resignation or removal of the Rights Agent or
the appointment of the successor Rights Agent, as the case may be.
Section 22. Issuance of New Rights Certificates.
Notwithstanding any of the provisions of this Agreement or of the Rights
Certificates to the contrary, the Company may, at its option, issue new
Rights Certificates evidencing Rights in such form as may be approved by
the Board to reflect any adjustment or change in the Purchase Price and the
number or kind or class of shares or other securities or property
purchasable under the Rights 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, issue Rights Certificates
representing the appropriate number of Rights in connection with such
issuance or sale; provided, however, that (i) no such Rights 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 Rights
Certificate would be issued and (ii) no such Rights Certificate shall be
issued if and to the extent that appropriate adjustment shall otherwise
have been made in lieu of the issuance thereof.
Section 23. Redemption and Termination.
(a) The Board may, at its option, at any time prior to the
earlier of (i) the Close of Business on the tenth Business Day (or such
specified or unspecified later date as may be determined by the Board
before the Rights cease being redeemable) following the Stock Acquisition
Date (or, if the Stock Acquisition Date shall have occurred prior to the
Record Date, the Close of Business on the tenth Business Day following the
Record Date) or (ii) the Final Expiration Date, direct the Company to, and
if directed, the Company shall, redeem all but not less than all of the
then outstanding Rights at a redemption price of $.01 per Right, as such
amount may be appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof (such
redemption price being hereinafter referred to as the "Redemption Price").
The Company may, at its option, pay the Redemption Price in shares of
Common Stock of the Company (based on the Current Market Price of the
Common Stock of the Company at the time of redemption), cash or any other
form of consideration deemed appropriate by the Board. Notwithstanding
anything contained in this Agreement to the contrary, the Rights shall not
be exercisable after the first occurrence of a Section 11(a)(ii) Event
until such time as the Company's right of redemption hereunder has expired.
(b) Immediately upon the action of the Board directing the
Company to make the redemption of the Rights, evidence of which shall have
been filed with the Rights Agent, and without any further action and
without any notice, the right to exercise the Rights will terminate, and
the only right thereafter of the holders of Rights shall be to receive the
Redemption Price for each Right so held. Promptly after the action of the
Board directing the Company to make the redemption of the Rights, the
Company shall give notice of such redemption to the Rights Agent and the
holders of the then outstanding Rights by mailing such notice to each
record holder of the Common Stock of the Company at the address of such
holder shown on the records 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.
Section 24. 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 Common Stock of the Company or to make any other
distribution to the holders of Common Stock of the Company (other than a
regular periodic cash dividend out of earnings or retained earnings of the
Company), (ii) to offer to the holders of Common Stock of the Company
rights or warrants to subscribe for or to purchase any additional shares of
Common Stock of the Company or shares of stock of any class or any other
securities, rights or options, (iii) to effect any reclassification of the
Common Stock of the Company (other than a reclassification involving only
the subdivision or split of outstanding shares of Common Stock of the
Company), (iv) to effect any consolidation, combination or merger into or
with any other Person or Persons (other than a Subsidiary of the Company in
a transaction which complies with Section 11(o) hereof), or to effect any
sale or other transfer (or to permit one or more of its Subsidiaries to
effect any sale or other transfer), in one transaction or a series of
related transactions, of more than 50% of the assets or earning power of
the Company and its Subsidiaries (taken as a whole) to any other Person or
Persons (other than the Company or any of its Subsidiaries in one or more
transactions each of which complies with Section 11(o) hereof) or (v) to
effect the liquidation, dissolution or winding up of the Company, then, in
each such case, the Company shall give to each holder of a Rights
Certificate, to the extent feasible and in accordance with Section 25
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,
combination, 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, 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 20 days prior to the record date for
determining holders of the shares of Common Stock of the Company for
purposes of such action, and in the case of any such other action, at least
20 days prior to the date of the taking of such proposed action or the date
of participation therein by the holders of the shares of Common Stock of
the Company, whichever shall be the earlier.
(b) In case a Section 11(a)(ii) Event shall occur, then (i) the
Company shall as soon as practicable thereafter give to each holder of a
Rights Certificate, to the extent feasible in accordance with Section 25
hereof, a notice of the occurrence of such event which notice shall specify
the event and the consequences of the event to holders of Rights under
Section 11(a)(ii) hereof, and (ii) all references in the preceding
paragraph to Common Stock of the Company shall be deemed thereafter to
refer, if appropriate, to other securities.
(c) The failure of the Company to give any notice provided for
in this Section 24, or any defect therein, shall not (i) relieve the
Company of any of its other obligations under this Agreement or (ii) affect
the legality or validity of the action for which notice was hereby
required.
Section 25. Notices. Notices or demands authorized by this
Agreement to be given or made by the Rights Agent or by the holder of any
Rights Certificate to or on the Company shall be sufficiently given or made
if sent by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Rights Agent) as follows:
TECO Energy, Inc.
▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Copies to:
▇▇▇▇▇▇ & Dodge LLP
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇., Esq.
and
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
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 Rights Certificate to or on the Rights Agent shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed (until another address is filed in writing with the Company) as
follows:
BankBoston, N.A.
c/o Boston EquiServe Limited Partnership
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Client Administration
Notices or demands authorized by this Agreement to be given or
made by the Company or the Rights Agent to the holder of any Rights
Certificate (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 books of the Company.
Section 26. Supplements and Amendments. Prior to the
Distribution Date, the Company and the Rights Agent shall, if the Board so
directs, supplement or amend any provision of this Agreement without the
approval of any holders of certificates representing shares of Common Stock
of the Company. From and after the Distribution Date and subject to the
penultimate sentence of this Section 26, the Company and the Rights Agent
shall, if the Board so directs, supplement or amend this Agreement without
the approval of any holders of Rights Certificates in order (i) to cure any
ambiguity, (ii) to correct or supplement any provision 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 hereunder in any manner which the Company may
deem necessary or desirable and which shall not adversely affect the
interests of the holders of Rights Certificates (other than an Acquiring
Person or an Associate or Affiliate of an Acquiring Person); provided, that
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 or to modify the ability (or inability) of the Board
to redeem the Rights, in either case 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, or the
benefits to, the holders of Rights (other than an Acquiring Person or an
Associate or Affiliate of an Acquiring Person). Upon the delivery of a
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 26, the Rights Agent shall execute such supplement or
amendment. Notwithstanding anything contained in this Agreement to the
contrary, no supplement or amendment shall be made which changes the
redemption price or the number of shares of Common Stock of the Company for
which a right is exercisable. 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.
Section 27. 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 28. Determinations and Actions by the Board, etc. 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 General Rules and Regulations under the Exchange Act.
The Board shall have the exclusive power and authority to administer this
Agreement and to exercise all rights and powers specifically granted to the
Board 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 (a) interpret the provisions of this Agreement and (b) make
all determinations deemed necessary or advisable for the administration of
this Agreement (including without limitation a determination to redeem or
not redeem the Rights or to amend this Agreement). All such actions,
calculations, interpretations and determinations (including without
limitation for purposes of clause (y) below, all omissions with respect to
the foregoing) which are done or made by the Board, the Company or the
Outside 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 the Board or the Outside Directors to any
liability to the holders of the Rights or otherwise.
Section 29. Benefits of this Agreement. Nothing in this
Agreement shall be construed to give to any Person other than the Company,
the Rights Agent and the registered holders of the Rights Certificates
(and, prior to the Distribution Date, registered holders of 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
Rights Certificates (and, prior to the Distribution Date, registered
holders of the Common Stock of the Company).
Section 30. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction
or other authority to be invalid, void or unenforceable, the remainder
of the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way be affected,
impaired or invalidated; 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 determines in its good faith judgment that
severing the invalid language from this Agreement would adversely affect
the purpose or effect of this 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 Business Day following the date of such
determination by the Board. Without limiting the foregoing, if any
provision of this Agreement requiring that a determination be made by the
Board or by the Outside Directors is held by a court of competent
jurisdiction or other authority to be invalid, void or unenforceable, such
determination shall then be made by the entire Board in accordance with
applicable law and the articles of incorporation and bylaws of the Company,
each as then in effect.
Section 31. Governing Law. This Agreement, each Right and each
Rights Certificate issued hereunder shall be deemed to be a contract made
under seal under the laws of the State of Florida, and for all purposes
this Agreement shall be governed by and construed in accordance with the
laws of the State of Florida applicable to contracts made and to be
performed entirely within the State of Florida.
Section 32. Counterparts. This Agreement may be executed in any
number of counterparts, and each of such counterparts shall for all
purposes be deemed to be an original, and all such counterparts shall
together constitute but one and the same instrument.
Section 33. Descriptive Headings. Descriptive headings of the
several Sections of this Agreement are inserted for convenience only and
shall not control or affect the meaning or construction of any of the
provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed and their respective corporate seals to be hereunto
affixed and attested, all as of the day and year first above written.
[SEAL]
Attest: TECO ENERGY, INC.
By______________________ By______________________________
Name: Name:
Title: Title:
[SEAL]
Attest: BANKBOSTON, N.A.,
as Rights Agent
By_____________________ By_____________________________
Name: Name:
Title: Title:
Exhibit A
[Form of Rights Certificate]
Certificate No. R- _________ Rights
NOT EXERCISABLE AFTER MAY 7, 2009, SUBJECT TO EARLIER REDEMPTION OR
EXPIRATION PURSUANT TO THE RENEWED RIGHTS AGREEMENT. THE RIGHTS ARE
SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $.01 PER RIGHT ON
THE TERMS SET FORTH IN THE RENEWED RIGHTS AGREEMENT. THE RIGHTS EVIDENCED
BY THIS CERTIFICATE SHALL NOT BE EXERCISABLE, AND SHALL BE VOID SO LONG AS
HELD, BY A HOLDER IN ANY JURISDICTION WHERE THE REQUISITE QUALIFICATION FOR
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 OR
AN ASSOCIATE OR AFFILIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED
IN THE RENEWED RIGHTS AGREEMENT) AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS
MAY BECOME NULL AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHTS
CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO IS, WAS OR
BECAME AN ACQUIRING PERSON OR AN ASSOCIATE OR AFFILIATE OF AN ACQUIRING
PERSON (AS SUCH TERMS ARE DEFINED IN THE RENEWED RIGHTS AGREEMENT).
ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY
BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(E) OF SUCH
AGREEMENT.](1)
________________________
(1) The portion of the legend in brackets shall be inserted only if
applicable, shall be modified to apply to an Acquiring Person, as
applicable, and shall replace the preceding sentence.
RIGHTS CERTIFICATE
TECO ENERGY, INC.
This certifies that , or registered assigns, is the
registered owner of the number of Rights set forth above, each of which
entitles the owner thereof, subject to the terms, provisions and conditions
of the Renewed Rights Agreement, dated as of October 21, 1998, as amended,
restated, renewed or extended from time to time (the "Rights Agreement"),
between TECO Energy, Inc., a Florida corporation (the "Company"), and
BankBoston, N.A., a national banking association (the "Rights Agent"), to
purchase from the Company at any time prior to 5:00 P.M., Tampa, Florida
time, on May 7, 2009 at the office or offices of the Rights Agent, or its
successors as Rights Agent, designated for such purpose, one fully paid,
nonassessable share of common stock, par value $1.00 per share, of the
Company (the "Common Stock"), at a purchase price of $90.00 per share (the
"Purchase Price"), upon presentation and surrender of this Rights
Certificate with the Form of Election to Purchase and included Certificate
duly completed and executed. The number of Rights evidenced by this
Rights Certificate (and the number of shares of Common Stock which may be
purchased upon exercise thereof) set forth above, and the Purchase Price
set forth above, are the number and Purchase Price as of _________,
______, based on the Common Stock as constituted at such date. The Company
reserves the right to require prior to the occurrence of a Triggering Event
(as such term is defined in the Rights Agreement) that a number of Rights
be exercised so that only whole shares of Common Stock will be issued. The
holder of the Right evidenced hereby consents and agrees that, subject to
the terms of the Rights Agreement, the Company and the Rights Agent may
deem and treat the person in whose name this Rights Certificate is
registered as the absolute owner hereof and of the Rights evidenced hereby
(notwithstanding any notations of ownership or writing on this Rights
Certificate made by anyone other than the Company or the Rights Agent) for
all purposes whatsoever, and neither the Company nor the Rights Agent shall
be required to be affected by any notice to the contrary.
As more fully set forth in the Rights Agreement, from and after
the first occurrence of a Section 11(a)(ii) Event (as such term is defined
in the Rights Agreement), if the Rights evidenced by this Rights
Certificate are beneficially owned by (i) an Acquiring Person or an
Associate or Affiliate of an Acquiring Person (as such terms are defined in
the Rights Agreement), which is determined to have been involved in or
caused or facilitated, directly or indirectly, such Section 11(a)(ii)
Event, (ii) a transferee of such Acquiring Person (or of any such Associate
or Affiliate), or (iii) under certain circumstances specified in the Rights
Agreement, a transferee of such Acquiring Person (or of any such Associate
or Affiliate) who becomes a transferee prior to or concurrently with such
Acquiring Person becoming such, such Rights shall become null and void
without any further action, and no holder hereof shall have any right with
respect to such Rights whether under the Rights Agreement or otherwise.
As provided in the Rights Agreement, the Purchase Price and the
number and kind of shares of Common Stock or other securities, which may be
purchased upon the exercise of the Rights evidenced by this Rights
Certificate are subject to modification and adjustment upon the happening
of certain events, including Triggering Events (as defined in the Rights
Agreement).
This Rights Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms, provisions
and conditions are hereby incorporated herein by reference and made a part
hereof and to which Rights Agreement reference is hereby made for a full
description of the rights, limitations of rights, obligations, duties and
immunities hereunder of the Rights Agent, the Company and the holders of
the Rights Certificates, which limitations of rights include the temporary
suspension of the exercisability of such Rights under the specific
circumstances set forth in the Rights Agreement. Reference is also made to
the Rights Agreement for definitions of capitalized terms used and not
defined herein. Copies of the Rights Agreement are on file at the
principal office of the Rights Agent and are also available upon written
request to the Rights Agent.
This Rights Certificate, with or without other Rights
Certificates, upon surrender at the office or offices of the Rights Agent
designated for such purpose, may be exchanged for another Rights
Certificate or Rights Certificates of like tenor and date evidencing Rights
entitling the holder to purchase a like aggregate number of shares of
Common Stock as the Rights evidenced by the Rights Certificate or Rights
Certificates surrendered shall have entitled such holder to purchase. If
this Rights Certificate shall be exercised in part, the holder shall be
entitled to receive upon surrender hereof another Rights Certificate or
Rights Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Certificate may be redeemed by the Company at its option
at a redemption price of $.01 per Right at any time prior to the earlier of
(i) the Close of Business on the tenth Business Day following the Stock
Acquisition Date (as such time period may be extended pursuant to the
Rights Agreement) and (ii) the Final Expiration Date (as defined in the
Rights Agreement).
If the Company so determines, no fractional shares of Common
Stock will be issued upon the exercise of any Right or Rights evidenced
hereby, but in lieu thereof, a cash payment will be made, as provided in
the Rights Agreement.
No holder of this Rights Certificate, as such, shall be entitled
to vote or receive dividends or be deemed for any purpose the holder of
shares of Common Stock or of any other securities of the Company which may
at any time be issuable on the exercise hereof, nor shall anything
contained in the Rights Agreement or herein be construed to confer upon the
holder hereof, as such, any of the rights of a 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 the Rights
Agreement), or to receive dividends or subscription rights, or otherwise,
until the Right or Rights evidenced by this Rights Certificate shall have
been exercised as provided in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal.
Dated as of____________, ____
[SEAL]
ATTEST: TECO ENERGY, INC.
__________________________ By_________________________________
Secretary Title:
Countersigned:
BANKBOSTON, N.A.,
as Rights Agent
By________________________
Authorized Signature
[Form of Reverse Side of Rights Certificate]
ASSIGNMENT
(To be executed by the registered holder if such holder
desires to transfer the Rights Certificate.)
FOR VALUE RECEIVED ___________________________________________________________
hereby sells, assigns and transfers unto _____________________________________
______________________________________________________________________________
(Please print name and address of transferee)
__________________________________________________________
this Rights Certificate, together with all right, title and interest
herein, and does hereby irrevocably constitute and appoint ____ Attorney,
to transfer the within Rights Certificate on the books of the within-named
Company, with full power of substitution.
Dated:________________, ____
________________________________________+
Signature
Signature Guaranteed:
Certificate
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) this Rights Certificate [ ] is [ ] is not being sold,
assigned and transferred by or on behalf of a Person who is or was an
Acquiring Person, or an Associate or Affiliate of any such Acquiring Person
(as such terms are defined in the 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 Rights Certificate from any Person who is, was or
subsequently became an Acquiring Person or an Associate or Affiliate of an
Acquiring Person.
Dated:____________, ____ _______________________________________
Signature
Signature Guaranteed:
NOTICE
The signatures to the foregoing Assignment and Certificate must
correspond to the name as written upon the face of this Rights Certificate
in every particular, without alteration or enlargement or any change
whatsoever.
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise Rights
represented by the Rights Certificate.)
To: TECO Energy, Inc.
The undersigned hereby irrevocably elects to exercise ____________
Rights represented by this Rights Certificate to purchase the shares of
Common Stock issuable upon the exercise of the Rights (or such other
securities of the Company or of any other Person which may be issuable or
such other assets which may be deliverable upon the exercise of the Rights)
and requests that certificates for any such shares or securities be issued
in the name of and delivered to:
Please insert social security
or other identifying number ___________________
_____________________________________________________________________________
(Please print name and address)
_____________________________________________________________________________
If such number of Rights shall not be all the Rights evidenced by
this Rights Certificate, a new Rights Certificate for the balance of such
Rights shall be registered in the name of and delivered to:
Please insert social security
or other identifying number__________________
_____________________________________________________________________________
(Please print name and address)
_____________________________________________________________________________
_____________________________________________________________________________
Dated:________________, ____
________________________________________
Signature
Signature Guaranteed:
Certificate
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) the Rights evidenced by this Rights Certificate [ ] are [ ]
are not being exercised by or on behalf of a Person who is or was an
Acquiring Person or an Associate or Affiliate of any such Acquiring Person
(as such terms are defined in the Rights Agreement); and
(2) after due inquiry and to the best knowledge of the
undersigned, the undersigned [ ] did [ ] did not acquire the Rights
evidenced by this Rights Certificate from any Person who is, was or became
an Acquiring Person or an Associate or Affiliate 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
Rights Certificate in every particular, without alteration or enlargement
or any change whatsoever.
