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EXHIBIT 1
RIGHTS AGREEMENT
TRICO BANCSHARES
and
MELLON INVESTOR SERVICES LLC,
as Rights Agent
Dated as of June 25, 2001
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TABLE OF CONTENTS
Page
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1. Certain Definitions......................................................................................1
2. Appointment of Rights Agent..............................................................................4
3. Issue of Right Certificates..............................................................................5
4. Form of Right Certificates...............................................................................6
5. Countersignature and Registration........................................................................7
6. Transfer, Split Up, Combination and Exchange of Right Certificates; Mutilated,
Destroyed, Lost or Stolen Right Certificates.............................................................8
7. Exercise of Rights; Purchase Price; Expiration Date of Rights............................................9
8. Cancellation and Destruction of Right Certificates......................................................11
9. Reservation and Availability of Shares of Series AA Preferred Stock.....................................11
10. Series AA Preferred Stock Record Date...................................................................12
11. Adjustment of Purchase Price, Number of Shares or Number of Rights......................................12
12. Certificate of Adjusted Purchase Price or Number of Shares..............................................20
13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power....................................20
14. Fractional Rights and Fractional Shares.................................................................23
15. Rights of Action........................................................................................24
16. Agreement of Right Holders..............................................................................25
17. Right Certificate Holder Not Deemed a Stockholder.......................................................25
18. Concerning the Rights Agent.............................................................................26
19. Merger or Consolidation or Change of Name of Rights Agent...............................................26
20. Rights and Duties of Rights Agent.......................................................................27
21. Change of Rights Agent..................................................................................29
22. Issuance of New Right Certificates......................................................................30
23. Redemption and Termination..............................................................................30
24. Exchange................................................................................................31
25. Notice of Proposed Actions..............................................................................33
26. Notices.................................................................................................33
27. Supplements and Amendments..............................................................................34
28. Successors..............................................................................................35
29. Benefits of This Rights Agreement.......................................................................35
30. Severability............................................................................................35
31. Governing Law...........................................................................................35
32. Counterparts............................................................................................35
33. Descriptive Headings....................................................................................36
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RIGHTS AGREEMENT
This Rights Agreement, dated as of June 25, 2001 (the "Rights
Agreement"), is entered into between TriCo Bancshares, a California corporation
(the "Company"), and Mellon Investor Services LLC, a New Jersey limited
liability company (the "Rights Agent").
WITNESSETH
WHEREAS, on May 8, 2001, the Board of Directors (as hereinafter
defined) authorized and declared a dividend distribution of one right (each a
"Right" and collectively the "Rights") for each share of Common Stock (as
hereinafter defined) of the Company outstanding at the close of business on July
10, 2001 (the "Record Date"), and has authorized the issuance of one Right in
respect of each share of common stock of the Company issued between the Record
Date and the Distribution Date (as such term is defined in Section 3 hereof),
each Right representing the right to purchase one one-hundredths of a share of
Series AA Preferred Stock of the Company having the rights, powers and
preferences set forth in the form of Certificate of Designation attached hereto
as EXHIBIT A, upon the terms and subject to the conditions hereinafter set
forth; and
WHEREAS, the Company desires to appoint the Rights Agent to act as
provided herein, and the Rights Agent is willing to so act.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
1. Certain Definitions. For purposes of this Rights Agreement, the
following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as
hereinafter defined) who or which, together with all Affiliates (as hereinafter
defined) and Associates (as hereinafter defined) of such Person, without the
Prior Written Approval of the Company (as hereinafter defined), shall be the
Beneficial Owner (as hereinafter defined) of securities of the Company
constituting 15% or more of the Voting Power (as hereinafter defined) of the
Company or was such a Beneficial Owner at any time after the date hereof,
whether or not such Person continues to be the Beneficial Owner of securities
representing 15% or more of the Voting Power of the Company, but shall not
include (i) the Company, any Subsidiary (as hereinafter defined) of the Company,
any employee benefit plan or compensation arrangement of the Company or any
Subsidiary of the Company, or any entity holding securities of the Company to
the extent organized, appointed or established by the Company or any Subsidiary
of the Company for or pursuant to the terms of any such employee benefit plan or
compensation arrangement, or (ii) any Person who or which, together with all
Affiliates and Associates of such Person, inadvertently may become the
Beneficial Owner of securities of the Company representing 15% or more of the
Voting Power of the Company, so long as such Person, individually or together
with the Affiliates and Associates of such Person, (y) within 8 Business Days
(as hereinafter defined) after such Person would have become an Acquiring Person
(but for the operation of this clause) delivers written notice to the Board of
Directors that such Person did so inadvertently and (z) within 5 Business Days
after such notice
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divests (without exercising or retaining any power, including voting, with
respect to such securities), sufficient securities of the Company so that such
Person, together with all Affiliates and Associates of such Person, ceases to be
the Beneficial Owner of 15% or more of the Voting Power of the Company.
Notwithstanding the foregoing, no Person shall become an "Acquiring Person" as
the result of an acquisition of voting securities of the Company by the Company
which, by reducing the amount of such securities outstanding, increases the
proportionate voting power of such securities beneficially owned by such Person
to 15% or more of the Voting Power; provided, however, that if a Person becomes
the Beneficial Owner of securities constituting 15% or more of the Voting Power
of the Company by reason of purchases by the Company and shall, after such
purchases by the Company, become the Beneficial Owner of additional securities
constituting 1% or more of the Voting Power of the Company without the Prior
Written Approval of the Company, then such Person shall be deemed to be an
Acquiring Person.
(b) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the rules and regulations
promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), as in effect on the date hereof.
(c) 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
Affiliates or Associates beneficially owns, directly or indirectly as determined
pursuant to Rule 13d-3 of the rules and regulations under the Exchange Act, as
in effect on the date hereof;
(ii) which such Person or any of such Person's
Affiliates or Associates has (A) the right to acquire (whether such right is
exercisable immediately or only after the passage of time) pursuant to any
agreement, arrangement or understanding (other than customary agreements with
and between underwriters and selling group members with respect to a bona fide
public offering of securities), or upon the exercise of conversion rights,
exchange rights, rights (other than these Rights), warrants or options, or
otherwise; provided, however, that a Person shall not be deemed the "Beneficial
Owner" of securities tendered pursuant to a tender or exchange offer made by or
on behalf of such Person or any of such Person's Affiliates or Associates until
such tendered securities are accepted for payment or exchange; or (B) the right
to vote pursuant to any agreement, arrangement or understanding; provided,
however, that a Person shall not be deemed the "Beneficial Owner" of any
security under this clause (B) if the agreement, arrangement or understanding to
vote such security (1) 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 rules and regulations under the Exchange Act and
(2) is not also then reportable by such person on Schedule 13D under the
Exchange Act (or any comparable or successor report); or
(iii) which are beneficially owned, directly or
indirectly, by any other Person with which such Person or any of such Person's
Affiliates or Associates has any agreement, arrangement or understanding (other
than customary agreements with and between
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underwriters and selling group members with respect to a bona fide public
offering of securities) for the purpose of acquiring, holding, voting (except
pursuant to a revocable proxy or consent as described in clause (B) of
subparagraph (ii) of this paragraph (c)) or disposing of any securities of the
Company.
Notwithstanding anything in this definition of Beneficial
Ownership to the contrary, the phrase "then outstanding," when used with
reference to a Person's Beneficial Ownership of securities of the Company, shall
mean the number of such securities then issued and outstanding together with the
number of such securities not then actually issued and outstanding which such
Person would be deemed to own beneficially hereunder.
(d) "Board of Directors" shall mean the Board of
Directors of the Company as constituted from time to time.
(e) "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in the State of
California or the State of New Jersey are authorized or obligated by law or
executive order to close.
(f) "Close of Business" on any given date shall mean 5:00
p.m., Chico, California, time, on such date; provided, however, that if such
date is not a Business Day it shall mean 5:00 p.m., Chico, California, time, on
the next succeeding Business Day.
(g) "Common Stock" shall mean the common stock, no par
value, of the Company, except that "Common Stock" when used with reference to
any Person other than the Company shall mean the capital stock with the greatest
Voting Power of such Person or the equity securities or other equity interest
having power to control or direct the management of such Person or, if such
Person is a Subsidiary of another Person, of the Person which ultimately
controls such first-mentioned Person and which has issued and outstanding such
capital stock, equity securities or equity interests.
(h) "Distribution Date" shall have the meaning set forth
in Section 3 hereof.
(i) "Expiration Date" shall have the meaning set forth in
Section 7(a) hereof.
(j) "Final Expiration Date" shall have the meaning set
forth in Section 7(a) hereof.
(k) "Person" shall mean any individual, firm,
corporation, limited liability company, trust, association, partnership or other
entity, and shall include any successor (by merger or otherwise) of any such
entity.
(l) "Series AA Preferred Stock" shall mean the Series AA
Junior Participating Preferred Stock, no par value, of the Company having the
rights and preferences set forth in the Form of Certificate of Designation
attached to this Agreement as EXHIBIT A.
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(m) "Prior Written Approval of the Company" shall mean
prior express written consent of the Company to the actions in question,
executed on behalf of the Company by a duly authorized officer of the Company
following express approval by action of a majority of the members of the Board
of Directors then in office.
(n) "Purchase Price" shall have the meaning set forth in
Section 7(b) hereof.
(o) "Redemption Price" shall have the meaning set forth
in Section 23(a) hereof.
(p) "Flip-in Event" shall have the meaning set forth in
Section 11(b)(i) hereof.
(q) "Flip-over Event" shall mean an event described in clauses
(x), (y) or (z) of Section 13(a) hereof.
(r) "Stock Acquisition Date" shall mean the earlier of
(i) the first date of public announcement by a Person that an Acquiring Person
has become an Acquiring Person, or (ii) the date on which the Company first has
notice, direct or indirect, or otherwise determines that a Person has become an
Acquiring Person.
(s) "Subsidiary" shall mean, with respect to any Person,
any other Person of which securities or other ownership interests having
ordinary Voting Power, in the absence of contingencies, to elect a majority of
the board of directors (or other persons performing similar functions) of such
other Person are at the time directly or indirectly owned by such Person or one
or more of such Person's Subsidiaries, except that "Subsidiary" when used with
reference to the Company shall mean any Person of which either a majority of the
Voting Power of the voting equity securities or a majority of the equity
interests is owned, directly or indirectly, by the Company.
(t) "Voting Power" shall mean the voting power of all
securities of a Person then outstanding generally entitled to vote for the
election of directors of the Person (or, where appropriate, for the election of
persons performing similar functions).
2. Appointment of Rights Agent. The Company hereby appoints the Rights
Agent to act as agent for 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 (10) days' prior written notice to the Rights
Agent. In the event the Company appoints one or more co-Rights Agents, the
respective duties of the Rights Agent and any co-Rights Agents shall be as the
Company shall determine. The Rights Agent shall have no duty to supervise, and
in no event be liable for, the acts or omissions of any co-Rights Agent.
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3. Issue of Right Certificates.
(a) Until the earlier of (i) the Close of Business on the
tenth Business Day after the Stock Acquisition Date or (ii) the Close of
Business on the tenth Business Day (or such later date as may be determined by
action of the Board of Directors but in no event later than the tenth Business
Day after such time as any Person becomes an Acquiring Person) after the date
that a tender or exchange offer by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan or compensation arrangement
of the Company or of any Subsidiary of the Company, or any entity holding
securities of the Company to the extent organized, appointed or established by
the Company or any Subsidiary of the Company for or pursuant to the terms of any
such employee benefit plan or compensation arrangement) is commenced within the
meaning of Rule 14d-2(a) of the rules and regulations under the Exchange Act,
without the Prior Written Approval of the Company, which tender or exchange
offer would result in any Person becoming the Beneficial Owner of Voting Power
of the Company aggregating 15% or more of the outstanding Voting Power of the
Company (including any such date which is after the date of this Rights
Agreement and prior to the issuance of the Rights; the earlier of such dates
being herein referred to as the "Distribution Date"), (x) the Rights will be
evidenced (subject to the provisions of paragraph (b) of this Section 3) by the
certificates for the Common Stock registered in the names of the holders of the
Common Stock (which certificates for Common Stock shall be deemed also to be
Right Certificates) and not by separate Right Certificates, as more fully set
forth below, and (y) the Rights (and the right to receive certificates therefor)
will be transferable only in connection with the transfer of the underlying
shares of Common Stock, as more fully set forth below. As soon as practicable
after the Company has notified the Rights Agent of the occurrence of the
Distribution Date and provided the Rights Agent with all necessary information
(and if the Rights Agent is not also the transfer agent and registrar of Common
Stock, provide the Rights Agent with the names and addresses of all record
holders of Common Stock), the Company shall prepare and execute, and the Rights
Agent shall countersign and send, by first-class, insured, postage prepaid mail,
to each record holder of the Common Stock as of the Close of Business on the
Distribution Date, at the address of such holder shown on the records of the
Company, a right certificate, in substantially the form of EXHIBIT B hereto (the
"Right Certificate"), evidencing one Right for each share of Common Stock so
held, subject to adjustment as provided herein. As of and after the Distribution
Date, the Rights will be evidenced solely by such Right Certificates.
(b) On the Record Date or as soon as practicable
thereafter, the Company will send a copy of a Summary of Rights to Purchase
Series AA Preferred Stock, in substantially the form of EXHIBIT C hereto (the
"Summary of Rights"), by first-class, postage prepaid mail, to each record
holder of the Common Stock as of the Close of Business on the Record Date, at
the address of such holder shown on the records of the Company. With respect to
certificates for the Common Stock outstanding as of the Record Date, until the
Distribution Date (or the earlier redemption, expiration or termination of the
Rights), the Rights will be evidenced by such certificates for the Common Stock
registered in the names of the holders of the Common Stock and the registered
holders of the Common Stock shall also be registered holders of the associated
Rights. Until the Distribution Date (or the earlier redemption, expiration or
termination of the
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Rights), the surrender for transfer of any of the certificates for the Common
Stock outstanding in respect of which Rights have been issued shall also
constitute the transfer of the Rights associated with the Common Stock
represented by such certificate.
(c) Certificates for the Common Stock issued after the
Record Date but prior to the earlier of the Distribution Date or the redemption,
expiration or termination of the Rights shall be deemed also to be certificates
for Rights and shall have impressed, printed or written on, or otherwise affixed
to them a legend substantially to the following effect:
This certificate also evidences and entitles the holder hereof
to certain Rights as set forth in a Rights Agreement dated as
of June 25, 2001, between TriCo Bancshares (the "Company") and
Mellon Investor Services LLC (the "Rights Agreement"), as it
may from time to time be supplemented or amended, the terms of
which are incorporated herein by reference and a copy of which
is on file at the principal executive offices of the Company.
Under certain circumstances, as set forth in the Rights
Agreement, such Rights may expire or may be redeemed,
exchanged or be evidenced by separate certificates and no
longer be evidenced by this certificate. The Company will mail
to the holder of this certificate a copy of the Rights
Agreement without charge promptly after receipt of a written
request therefor. Under certain circumstances, Rights issued
to or held by Acquiring Persons or their Affiliates or
Associates (as defined in the Rights Agreement) and any
subsequent holder of such Rights may become null and void.
With respect to such certificates containing the foregoing legend, until the
Distribution Date (or the earlier redemption, expiration or termination of the
Rights), the Rights associated with the Common Stock represented by such
certificates shall be evidenced by such certificates alone, and the surrender
for transfer of any of such certificates shall also constitute the transfer of
the Rights associated with the Common Stock represented by such certificates.
In the event that the Company purchases or acquires any Common Stock
after the Record Date but prior to the Distribution Date, any Rights associated
with such Common Stock shall be deemed canceled and retired so that the Company
shall not be entitled to exercise any Rights associated with shares of Common
Stock which are no longer outstanding.
4. Form of Right Certificates.
(a) The Right Certificates (and the forms of election to
purchase Series AA Preferred Stock and of assignment to be printed on the
reverse thereof) shall be in substantially the same form as EXHIBIT B hereto and
may have such marks of identification or designation and such legends, summaries
or endorsements printed thereon as the Company may deem appropriate (but which
do not affect the duties or responsibilities of the Rights Agent) and as are not
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inconsistent with the provisions of this Rights Agreement, or as may be required
to comply with any applicable law, rule or regulation or with any rule or
regulation of any stock exchange on which the Rights may from time to time be
listed, or to conform to customary usage. Subject to the provisions of Section
11 and Section 22 hereof, the Right Certificates, whenever issued, shall be
dated as of the Record Date, and on their face shall entitle the holders thereof
to purchase such number of one one-hundredths of a share of Series AA Preferred
Stock as shall be set forth therein at the Purchase Price, but the number and
identity of such shares and the Purchase Price shall be and remain subject to
adjustment as provided herein.
(b) Any Right Certificate issued pursuant hereto 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) which becomes a transferee after the
Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) which becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and which receives such
Rights pursuant to either (A) a transfer (whether or not for consideration) from
the Acquiring Person (or any such Associate or Affiliate) to holders of equity
interests in such Acquiring Person (or such Associate or Affiliate) or to any
Person with whom such Acquiring Person (or such Associate or Affiliate) has any
continuing agreement, arrangement or understanding regarding either the
transferred Rights, shares of Company Common Stock or the Company or (B) a
transfer which a majority of the Board of Directors has determined to be part of
an agreement, arrangement or understanding which has as a primary purpose or
effect the avoidance of Section 7(e) hereof, and any Right Certificate issued
pursuant to Section 6 hereof, Section 11 hereof or Section 22 hereof upon
transfer, exchange, replacement or adjustment of any other Right Certificate
referred to in this sentence, shall contain (to the extent the Rights Agent has
notice and to the extent feasible) the following legend:
The Rights represented by this Right Certificate are or were
beneficially owned by a Person who was or became an Acquiring
Person or an Affiliate or an Associate of an Acquiring Person.
Accordingly, this Right Certificate and the Rights represented
hereby are null and void in the circumstances specified in
Section 7(e) of the Rights Agreement.
The failure to print the foregoing legend on any such Right Certificate or any
defect therein shall not affect in any manner whatsoever the application or
interpretation of the provisions of Section 7(e) hereof.
5. Countersignature and Registration.
(a) The Right Certificates shall be executed on behalf of
the Company by its Chairman of the Board, Chief Executive Officer, President,
Chief Financial Officer or any Vice President, either manually or by facsimile
signature, and shall have affixed thereto the Company's seal or a facsimile
thereof which shall be attested by the Secretary or an Assistant Secretary of
the
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Company, either manually or by facsimile signature. The Right Certificates shall
be countersigned manually or by facsimile signature by the Rights Agent and
shall not be valid for any purpose unless so countersigned. In case any officer
of the Company whose manual or facsimile signature is affixed to the Right
Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Right Certificates, nevertheless, may be countersigned by the Rights Agent,
issued and delivered with the same force and effect as though the person who
signed such Right Certificates had not ceased to be such officer of the Company.
Any Right Certificate may be signed on behalf of the Company by any person who,
at the actual date of the execution of such Right Certificate, shall be a proper
officer of the Company to sign such Right Certificate, although at the date of
the execution of this Rights Agreement any such person was not such an officer.
(b) Following the Distribution Date and receipt by the
Rights Agent of any relevant information, the Rights Agent will keep or cause to
be kept, at its office designated for such purpose, books for registration and
transfer of the Right Certificates issued hereunder. Such books shall show the
names and addresses of the respective holders of the Right Certificates, the
number of Rights evidenced on its face by each of the Right Certificates, the
certificate number of each of the Right Certificates and the date of each of the
Right Certificates.
6. Transfer, Split Up, Combination and Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen Right Certificates.
(a) Subject to the provisions of Sections 4(b), 7(e) and
14 hereof, at any time after the Close of Business on the Distribution Date, and
at or prior to the Close of Business on the Expiration Date, any Right
Certificate or Right Certificates may be transferred, split up, combined or
exchanged for another Right Certificate or Right Certificates, entitling the
registered holder to purchase a like number of one one-hundredths shares of
Series AA Preferred Stock as the Right Certificate or Right Certificates
surrendered then entitled such holder to purchase. Any registered holder
desiring to transfer, split up, combine or exchange any Right Certificate shall
make such request in writing delivered to the Rights Agent, and shall surrender
the Right Certificate or Right Certificates to be transferred, split up,
combined or exchanged at the office of the Rights Agent designated for such
purpose. Thereupon, the Rights Agent shall countersign and deliver to the person
entitled thereto a Right Certificate or Right Certificates, as the case may be,
as so requested. The Company may require payment of a sum sufficient to cover
any tax or charge that may be imposed in connection with any transfer, split up,
combination or exchange of Right Certificates. The Rights Agent shall have no
duty or obligation under this section unless and until it is satisfied that all
such taxes and/or charges have been paid.
(b) Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of loss, theft or destruction,
of indemnity or security satisfactory to them, and reimbursement to the Company
and the Rights Agent of all reasonable expenses incidental thereto, and upon
surrender to the Rights Agent and cancellation of the Right Certificate if
mutilated, the Company will make and deliver a new Right Certificate of like
tenor to the Rights Agent for
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countersignature and delivery to the registered owner in lieu of the Right
Certificate so lost, stolen, destroyed or mutilated.
7. Exercise of Rights; Purchase Price; Expiration Date of Rights.
(a) The registered holder of any Right Certificate may
exercise the Rights evidenced thereby (except as otherwise provided herein) in
whole or in part at any time after the Distribution Date upon surrender of the
Right Certificate, with the form of election to purchase on the reverse side
thereof duly and properly executed, to the Rights Agent at the office of the
Rights Agent designated for such purpose, together with payment of the Purchase
Price for each one one-hundredths of a share of Series AA Preferred Stock as to
which the Rights are exercised, at or prior to the Close of Business on the
Expiration Date. The "Expiration Date," as used in this Rights Agreement, shall
be the earliest of (i) the Final Expiration Date (as defined below), (ii) the
time at which the Rights are redeemed as provided in Section 23 hereof, or (iii)
the time at which the Rights are exchanged as provided in Section 24 hereof. The
"Final Expiration Date," as used in this Rights Agreement, shall be July 10,
2011.
(b) The "Purchase Price" for each one one-hundredths of a
share of Series AA Preferred Stock pursuant to the exercise of a Right shall be
as set forth on the face of the Right Certificates, shall initially be $49.00,
shall be subject to adjustment from time to time as provided in Sections 11 and
13 hereof and shall be payable in lawful money of the United States of America
in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate, with the form of
election to purchase duly and properly executed, accompanied by payment of the
Purchase Price for each one one-hundredth of a share of Series AA Preferred
Stock to be purchased and an amount equal to any applicable tax or charge
required to be paid by the holder of the Rights pursuant hereto in accordance
with Section 9 hereof by certified check, bank draft or money order payable to
the order of the Company or the Rights Agent, the Rights Agent shall, subject to
Section 20(k) hereof, thereupon promptly (i) either (A) requisition from any
transfer agent of the one one-hundredths of a share of Series AA Preferred Stock
(or make available, if the Rights Agent is the transfer agent) certificates for
the number of one one-hundredths of a share of Series AA Preferred Stock to be
purchased and the Company hereby irrevocably authorizes any such transfer agent
to comply with all such requests, or (B) if the Company, in its sole discretion,
shall have elected to deposit the shares of Series AA Preferred Stock issuable
upon exercise of the Rights hereunder into a depositary, requisition from the
depositary agent depositary receipts representing such number of one
one-hundredths of a share of Series AA Preferred Stock as are to be purchased
(in which case certificates for the shares of Series AA Preferred Stock
represented by such receipts shall be deposited by the transfer agent with the
depositary agent) and the Company hereby directs such depositary agent to comply
with all such requests, (ii) promptly after receipt of such certificates or
depositary receipts cause the same to be delivered to or upon the order of the
registered holder of such Right Certificate, registered in such name or names as
may be designated by such holder, (iii) when appropriate, requisition from the
Company the amount of cash to be paid in lieu of issuance of fractional shares
in accordance with Section 14 hereof, (iv)
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after receipt of any such cash, promptly deliver such cash to or upon the order
of the registered holder of such Right Certificate, (v) when appropriate,
requisition from the Company the amount of cash, property or securities issuable
upon exercise of a Right pursuant to the adjustment provisions of Section 11 or
the exchange provisions of Section 24, and (vi) after receipt of any such cash,
property or securities, promptly deliver such cash, property or securities to or
upon the order of the registered holder of such Right Certificate, of any such
cash or securities.
(d) In case the registered holder of any Right
Certificate shall exercise less than all the Rights evidenced thereby, a new
Right Certificate evidencing Rights equivalent to the Rights remaining
unexercised shall be issued by the Rights Agent to the registered holder of such
Right Certificate or to such holder's duly authorized assigns, subject to the
provisions of Section 14 hereof.
(e) Notwithstanding anything in this Rights Agreement to
the contrary, upon the first occurrence of a Flip-in Event or a Flip-over Event,
any Rights which are then or become beneficially owned by (i) an Acquiring
Person or an Associate or Affiliate of an Acquiring Person, (ii) a transferee of
an Acquiring Person (or of any such Associate or Affiliate) which becomes a
transferee after the Acquiring Person becomes such, or (iii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) which becomes a
transferee prior to or concurrently with the Acquiring Person becoming such and
which receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person (or any such Associate or Affiliate) to
holders of equity interests in such Acquiring Person (or any such Associate or
Affiliate) or to any Person with whom such Acquiring Person (or such Associate
or Affiliate) has any continuing agreement, arrangement or understanding
regarding the transferred Rights, shares of Company Common Stock or the Company
or (B) a transfer which a majority of the Board of Directors has determined to
be part of an agreement, arrangement or understanding which has as a primary
purpose or effect the avoidance of this Section 7(e), shall be null and void
without any further action, and no holder of such Rights shall have any rights
whatsoever with respect to such Rights, whether under any provision of this
Agreement or otherwise. The Company shall use all reasonable efforts to ensure
that the provisions of this Section 7(e) and Section 4(b) are complied with
(including notifying the Rights Agent thereof), but neither the Company nor the
Rights Agent shall have any liability to any holder of Rights or any other
Person as a result of the Company' s failure to make any determination under
this Section 7(e) or Section 4(b) with respect to an Acquiring Person or its
Affiliates, Associates or transferees hereunder.
(f) Notwithstanding anything in this Rights Agreement to
the contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder upon the occurrence of
any purported exercise as set forth in this Section 7 unless the certificate
contained in the appropriate form of election to purchase set forth on the
reverse side of the Right Certificate surrendered for such exercise shall have
been properly completed and duly executed by the registered holder thereof and
the Company or the Rights Agent shall have been provided with such additional
evidence of the identity of the Beneficial Owner (or former Beneficial Owner) or
Affiliates or Associates thereof as the Company or the Rights Agent shall
reasonably request.
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8. Cancellation and Destruction of Right Certificates. All Right
Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered to the Rights Agent, shall be canceled by it, and no Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Rights Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Right Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall deliver
all canceled Right Certificates to the Company, or shall, at the written request
of the Company, destroy such canceled Right Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.
9. Reservation and Availability of Shares of Series AA Preferred Stock.
(a) The Company covenants and agrees that it will cause
to be reserved and kept available out of its authorized and unissued shares of
Series AA Preferred Stock the number of shares of Series AA Preferred Stock that
will be sufficient to permit the exercise in full of all outstanding Rights and,
after the occurrence of a Flip-in Event or a Flip-over Event, shall so reserve
and keep available a sufficient number of shares of Series AA Preferred Stock,
Common Stock and/or other securities which may be required to permit the
exercise in full of the Rights pursuant to this Rights Agreement.
(b) The Company covenants and agrees that it will take
all such action as may be necessary to ensure that all shares of Series AA
Preferred Stock and/or other securities delivered upon exercise of Rights shall,
at the time of delivery of the certificates for such shares or other securities
(subject to payment of the Purchase Price), be duly and validly authorized and
issued and fully paid and nonassessable shares or other securities.
(c) The Company shall use its best efforts to (i) file,
as soon as practicable following the first occurrence of an event which would
establish the Distribution Date, a registration statement under the Securities
Act of 1933, as amended (the "Securities Act"), with respect to the securities
purchasable upon exercise of the Rights on an appropriate form, (ii) cause such
registration statement to become effective as soon as practicable after such
filing, and (iii) cause such registration statement to remain effective (with a
prospectus at all times meeting the requirements of the Securities Act) until
the Expiration Date. The Company will also take such action as may be
appropriate under the "blue sky" laws of the various states. The Company may
temporarily suspend, for a period of time not to exceed ninety (90) days after
the date set forth in clause (i) of the first sentence of this Section 9(c), the
exercisability of the Rights in order to prepare and file such registration
statement and permit it to become effective. Upon any such suspension, the
Company shall issue a public announcement stating that the exercisability of the
Rights has been temporarily suspended, as well as a public announcement at such
time as the suspension is no longer in effect. The Company shall notify the
Rights Agent whenever it makes a public announcement pursuant to this Section
9(c) and give the Rights Agent a copy of such announcement. Notwithstanding any
provision of this Agreement to the contrary,
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the Rights shall not be exercisable in any jurisdiction, unless the requisite
qualification in such jurisdiction shall have been obtained and until a
registration statement has been declared effective.
(d) The Company further covenants and agrees that it will
pay when due and payable any and all taxes and charges which may be payable in
respect of the issuance or delivery of the Right Certificates or of any shares
of Series AA Preferred Stock and/or other securities upon the exercise of
Rights. The Company shall not, however, be required to pay any tax or charge
which may be payable in respect of any transfer involved in the transfer or
delivery of Right Certificates or the issuance or delivery of certificates or
depositary receipts for Series AA Preferred Stock and/or other securities in a
name other than that of the registered holder of the Right Certificate
evidencing Rights surrendered for exercise, nor shall the Company be required to
issue or deliver any certificates or depositary receipts for shares of Series AA
Preferred Stock and/or other securities upon the exercise of any Rights until
any such tax or charge shall have been paid (any such tax or charge being
payable by the holder of such Right Certificate at the time of surrender) or
until it has been established to the Company's or Rights Agent's satisfaction
that no such tax or charge is due.
10. Series AA Preferred Stock Record Date. Each Person (other than the
Company) in whose name any certificate for shares of Series AA Preferred Stock
(or other securities) is issued upon the exercise of Rights shall for all
purposes be deemed to have become the holder of record of the Series AA
Preferred Stock (or other securities) represented thereby on, and such
certificate shall be dated, the date upon which the Right Certificate evidencing
such Rights was duly surrendered and payment of the Purchase Price (and any
applicable taxes or charges) was made; provided, however, that if the date of
such surrender and payment is a date upon which the Series AA Preferred Stock
(or other securities) transfer books of the Company are closed, such person
shall be deemed to have become the record holder of such shares on, and such
certificate shall be dated, the next succeeding Business Day on which the Series
AA Preferred Stock (or other securities) transfer books of the Company are open.
Prior to the exercise of the Rights evidenced thereby, the holder of a Right
Certificate shall not be entitled to any rights of a stockholder of the Company
with respect to shares for which the Rights shall be exercisable, including,
without limitation, the right to vote, to receive dividends or other
distributions or to exercise any preemptive rights, and shall not be entitled to
receive any notice of any proceedings of the Company, except as provided herein.
11. Adjustment of Purchase Price, Number of Shares or Number of Rights.
The Purchase Price, the number and identity of shares covered by each Right and
the number of Rights outstanding are subject to adjustment from time to time as
provided in this Section 11.
(a) In the event the Company shall at any time after the
date of this Rights Agreement (i) declare a dividend on the Series AA Preferred
Stock payable in shares of Series AA Preferred Stock, (ii) subdivide the
outstanding Series AA Preferred Stock, (iii) combine the outstanding Series AA
Preferred Stock into a smaller number of shares or (iv) issue any shares of its
capital stock in a reclassification of the Series AA Preferred Stock (including
any such reclassification in connection with a consolidation or merger in which
the Company is the
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continuing or surviving corporation), except as otherwise provided in this
Section 11, the Purchase Price in effect at the time of the record date for such
dividend or the time of the effective date of such subdivision, combination or
reclassification, and the number and kind of shares of capital stock, including
Series AA Preferred Stock, issuable upon exercise of a Right, shall be
proportionately adjusted so that the holder of any Right exercised after such
time, upon payment of the aggregate consideration such holder would have had to
pay to exercise such Right prior to such time, shall be entitled to receive the
aggregate number and kind of shares of capital stock, including Series AA
Preferred Stock, which, if such Right had been exercised immediately prior to
such date and at a time when the Series AA Preferred Stock transfer books of the
Company were open, such holder would have owned upon such exercise and been
entitled to receive by virtue of such dividend, subdivision, combination or
reclassification, provided, however, that in no event shall the consideration to
be paid upon the exercise of one Right be less than the aggregate par value of
the shares of capital stock of the Company issuable upon exercise of one Right.
(b) (i) In the event any Person becomes an Acquiring
Person ("Flip-in Event"), then proper provision shall be made so that each
holder of a Right, subject to Section 7(e) and Section 24 hereof and except as
provided below, shall after the later of the occurrence of such event and the
effective date of an appropriate registration statement pursuant to Section 9
hereof, have a right to receive, upon exercise thereof at the then current
Purchase Price, multiplied by the then number of one one-hundredths of a share
of Series AA Preferred Stock for which a Right is then exercisable, in
accordance with the terms of this Rights Agreement, in lieu of shares of Series
AA Preferred Stock, such number of shares of Common Stock of the Company as
shall equal the result obtained by (y) multiplying the then current Purchase
Price by the then number of one one-hundredths of a share of Series AA Preferred
Stock for which a Right is then exercisable and dividing that product by (z) 50%
of the current market price per one share of Common Stock (determined pursuant
to Section 11(f) hereof on the date of the occurrence of the Flip-in Event)
(such shares being referred to as the "Adjustment Shares").
(ii) A Flip-in Event shall not be deemed to have occurred
as a result of any Person becoming an Acquiring Person through a purchase of
Common Stock pursuant to a tender offer made in the manner prescribed by Section
14(d) of the Exchange Act and the rules and regulations promulgated thereunder;
provided, however, that such tender offer shall provide for the acquisition of
all of the outstanding Common Stock held by any Person other than such Person
and its Affiliates or Associates at a price and on terms determined by a
majority of the members of the Board of Directors who are not officers of the
Company and who are not representatives, nominees, Affiliates or Associates of
an Acquiring Person, after receiving advice from one or more investment or
financial advisers, to be (A) fair to shareholders (taking into account all
factors which such members of the Board deem relevant) and (B) otherwise in the
best interests of the Company and its shareholders, employees, customers and
communities in which the Company does business.
(c) In the event that there shall not be sufficient
shares of Common Stock authorized but unissued to permit the exercise in full of
the Rights in accordance with the
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foregoing subparagraph (b), the Company shall: (i) 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 (such excess being hereinafter
referred to as the "Spread"), and (ii) with respect to each Right, make adequate
provision to substitute for such unavailable Adjustment Shares either (1) cash,
(2) a reduction in the Purchase Price, (3) other equity securities of the
Company, including without limitation Series AA Preferred Stock, (4) debt
securities of the Company, (5) other assets or (6) any combination of the
foregoing, having, together with the Adjustment Shares issued upon exercise of
such Right, an aggregate value equal to the Current Value, where such aggregate
value has been determined by the Board of Directors of the Company based upon
the advice of a reputable investment banking firm selected by the Board of
Directors of the Company; provided, however, if, within 30 days following the
date of the occurrence of a Flip-in Event, the Company shall have not made
adequate provision to deliver value pursuant to clause (ii) above, then the
Company shall be obligated to deliver, upon the surrender for exercise of a
Right and without requiring payment of the Purchase Price, Common Stock (to the
extent shares of such Common Stock are available) and then, if necessary, cash
or Series AA Preferred Stock, which shares and/or cash have an aggregate value
equal to the Spread. If the Board of Directors of the Company shall determine in
good faith that it is likely that sufficient additional Common Stock could be
authorized for issuance upon exercise in full of the Rights, the 30-day period
set forth above may be extended to the extent necessary, but not more than 120
days following the date of the occurrence of the Flip-in Event in order that the
Company may seek shareholder approval for the authorization of such additional
shares (such period, as it may be extended, hereinafter referred to as the
"Substitution Period"). To the extent that the Company determines that action
needs to be taken pursuant to the first and/or second sentences of this Section
11(c), the Company (y) shall provide, subject to Section 7(e) hereof, that such
action shall apply uniformly to all outstanding Rights, and (z) may suspend the
exercisability of the Rights until the expiration of the Substitution Period in
order to seek any authorization of additional shares and/or to decide the
appropriate form of distribution to be made pursuant to such first sentence and
to determine the value thereof. In the event of any such suspension, the Company
shall issue a public announcement stating that the exercisability of the Rights
has been temporarily suspended, as well as a public announcement at such time as
the suspension is no longer in effect. The Company shall notify the Rights Agent
whenever it makes a public announcement pursuant to this Section 11(c) and give
the Rights Agent a copy of such announcement. For purposes of this Section
11(c), the value of the Common Stock shall be the current per share market price
(as determined pursuant to Section 11(f) hereof) per share of Common Stock on
the date of the occurrence of the Flip-in Event.
(d) If the Company shall fix a record date for the
issuance of rights or warrants to all holders of Series AA Preferred Stock
entitling them (for a period expiring within 90 calendar days after such record
date) to subscribe for or purchase Series AA Preferred Stock (or securities
having the same or more favorable rights, privileges and preferences as the
Series AA Preferred Stock ("Equivalent Preferred Stock")) or securities
convertible into Series AA Preferred Stock or Equivalent Preferred Stock, at a
price per share of Series AA Preferred Stock or per share of Equivalent
Preferred Stock or having a conversion or exercise price per share, as the case
may be, less than the current market price (as defined in Section 11(f) hereof)
per share of Series
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AA Preferred Stock on such record date, the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such date by a fraction, the numerator of which shall be
the number of shares of Series AA Preferred Stock outstanding on such record
date plus the number of shares of Series AA Preferred Stock which the aggregate
offering price of the total number of shares of Series AA Preferred Stock or
Equivalent Preferred Stock to be offered (and/or the aggregate initial
conversion price of the convertible securities so to be offered) would purchase
at such current market price, and the denominator of which shall be the number
of shares of Series AA Preferred Stock outstanding on such record date plus the
number of additional shares of Series AA Preferred Stock and/or Equivalent
Preferred Stock to be offered for subscription or purchase (or into which the
convertible securities so to be offered are initially convertible). In case such
subscription price may be paid in a consideration, part or all of which shall be
in a form other than cash, the value of such consideration shall be as
determined in good faith by a majority of the Board of Directors, whose
determination shall be described in a statement filed with the Rights Agent.
Shares of Series AA Preferred Stock owned by or held for the account of the
Company shall not be deemed outstanding for the purpose of any such computation.
Such adjustment shall be made successively whenever such a record date is fixed;
and in the event that such rights or warrants are not so issued, the Purchase
Price shall be adjusted to be the Purchase Price which would then be in effect
if such record date had not been fixed.
(e) If the Company shall fix a record date for the making
of a distribution to all holders of Series AA Preferred Stock (including any
such distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation) of evidences of
indebtedness, cash (other than a regular periodic cash dividend out of earnings
or retained earnings of the Company), assets (other than a dividend payable in
Series AA Preferred Stock, but including any dividend payable in stock other
than Series AA Preferred Stock) or convertible securities, subscription rights
or warrants (excluding those referred to in Section 11(d) 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 for one share
of Series AA Preferred Stock (as defined in Section 11(f) hereof) on such record
date less the fair market value (as determined in good faith by a majority of
the Board of Directors, whose determination shall be described in a statement
filed with the Rights Agent) of the portion of the assets or evidences of
indebtedness so to be distributed or of such convertible securities,
subscription rights or warrants applicable to one share of Series AA Preferred
Stock, and the denominator of which shall be such Current Market Price for one
share of Series AA Preferred Stock. Such adjustments shall be made successively
whenever such a record date is fixed; and in the event that such distribution is
not so made, the Purchase Price shall again be adjusted to be the Purchase Price
which would then be in effect if such record date had not been fixed.
(f) (i) For the purpose of any computation hereunder, the
"current market price" of any security (a "Security" for purposes of this
Section 11(f)(i)) on any date shall be deemed to be the average of the daily
closing prices per share of such Security for the 20 consecutive Trading Days
(as hereinafter defined) immediately prior to but not including such
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date; provided, however, that in the event that the current market price per
share of such Security is determined during a period following the announcement
by the issuer of such Security of (A) a dividend or distribution on such
Security payable in shares of such Security or securities convertible into
shares of such Security or (B) any subdivision, combination or reclassification
of such Security, and prior to the expiration of 20 Trading Days after but not
including the ex-dividend date for such dividend or distribution or the record
date for such subdivision, combination or reclassification, then, and in each
such case, the "current market price" shall be appropriately adjusted to reflect
the current market price per share equivalent of such Security. The closing
price for each day shall be the last sale price or, in case no such sale takes
place on such day, the average of the closing bid and asked prices, 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 Security is not listed or admitted to trading on the New
York Stock Exchange, as reported in the principal consolidated transaction
reporting system with respect to securities listed or admitted to trading on the
principal national securities exchange on which the Security is listed or
admitted to trading or, if the Security is not listed or admitted to trading on
any national securities exchange, as reported by the National Association of
Securities Dealers, Inc. Automated Quotation System ("Nasdaq") National Market
System, or if the Security is not listed or admitted to trading on any national
securities exchange or included in the Nasdaq National Market System, the
average of the high bid and low asked prices in the over-the-counter market, as
reported by Nasdaq or such other system then in use, or, if on any such date the
Security is not quoted by any such organization, the average of the closing bid
and asked prices as furnished by a professional market maker making a market in
the Security selected by a majority of the Board of Directors. If on any such
date no market maker is making a market in the Security, the fair value of such
Security on such date as determined in good faith by a majority of the Board of
Directors shall be used. The term "Trading Day" shall mean a day on which the
principal national securities exchange on which the Security is listed or
admitted to trading is open for the transaction of business or, if the Security
is not listed or admitted to trading on any national securities exchange a day
on which the Nasdaq National Market System is open for the transaction of
business or, if the Security is not listed or admitted to trading on any
national securities exchange or included in the Nasdaq National Market System, a
Business Day. If the Security is not publicly held or not so listed or traded,
"current market price" shall mean the fair value as determined in good faith by
a majority of the Board of Directors, whose determination shall be described in
a statement filed with the Rights Agent and shall be conclusive for all
purposes.
(ii) For the purpose of any computation hereunder,
the "current market price" per share (or one one-hundredth of a share) of Series
AA Preferred Stock shall be determined in the same manner as set forth above for
the Common Stock in clause (i) of this Section 11(f) (other than the last
sentence thereof). If the current market price per share (or one one-hundredth
of a share) of Series AA Preferred Stock cannot be determined in the manner
provided above or if the Series AA Preferred Stock is not publicly held or
listed or traded in a manner described in clause (i) of this Section 11(f), the
"current market price" per share of Series AA Preferred Stock shall be
conclusively deemed to be an amount equal to 100 (as such number may be
appropriately adjusted for such events as stock splits, stock dividends and
recapitalizations
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with respect to the Common Stock occurring after the date of this Rights
Agreement) multiplied by the current market price per share of the Common Stock
and the "current market price" per one one-hundredth of a share of Series AA
Preferred Stock shall be equal to the current market price per share of the
Common Stock (as appropriately adjusted). If neither the Common Stock nor the
Series AA Preferred Stock is publicly held or so listed or traded, "current
market price" per share shall mean the fair value per share as determined in
good faith by the Board of Directors, whose determination shall be described in
a statement filed with the Rights Agent and shall be conclusive for all
purposes.
(g) No adjustment in the Purchase Price shall be required
unless such adjustment would require an increase or decrease of at least 1% in
the Purchase Price; provided, however, that any adjustments which by reason of
this Section 11(g) 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 or other share and one-millionth of a share of Series AA
Preferred Stock, as the case may be. Notwithstanding the first sentence of this
Section 11(g), 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.
(h) In the event that at any time, as a result of an
adjustment made pursuant to Section 11(a) or (b) hereof, the holder of any Right
shall be entitled to receive upon exercise of such Right any shares of capital
stock of the Company other than shares of Series AA Preferred Stock, thereafter
the number of such other shares so receivable upon exercise of any Right shall
be subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the shares contained
in Section 11 hereof and the provisions of Sections 7, 9, 10, 13 and 14 hereof
with respect to the shares of Series AA Preferred Stock shall apply on like
terms to any such other shares.
(i) 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 one
one-hundredths of a share of Series AA Preferred Stock or other shares of
capital stock of the Company purchasable from time to time hereunder upon
exercise of the Rights, all subject to further adjustment of the Purchase Price.
(j) Unless the Company shall have exercised its election
as provided in Section 11(k) hereof, upon each adjustment of the Purchase Price
as a result of the calculations made in Section 11(d) and (e) 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
one one-hundredths of a share of Series AA Preferred Stock (calculated to the
nearest one-millionth) obtained by (i) multiplying (A) the number of one
one-hundredths of a share of Series AA Preferred Stock covered by a Right
immediately prior to the adjustment by (B) 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.
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(k) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights, in substitution
for any adjustment in the number of shares of Series AA Preferred Stock
purchasable upon the exercise of a Right. Each of the Rights outstanding after
such adjustment of the number of Rights shall be exercisable for the number of
one one-hundredths of a share of Series AA Preferred Stock for which such Right
was exercisable immediately prior to such adjustment. Each Right held of record
prior to such adjustment of the number of Rights shall become that number of
Rights (calculated to the nearest one ten- thousandth) obtained by dividing the
Purchase Price in effect immediately prior to adjustment of the Purchase Price
by the Purchase Price in effect immediately after adjustment of the Purchase
Price. The Company shall make a public announcement (with prompt notice thereof
to the Rights Agent) of its election to adjust the number of Rights, indicating
the record date for the adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which the Purchase
Price is adjusted or any day thereafter, but, if the Right Certificates have
been issued, shall be at least 10 days later than the date of the public
announcement. If Right Certificates have been issued, upon each adjustment of
the number of Rights pursuant to this Section 11(k), the Company shall, as
promptly as practicable, cause to be distributed to holders of record of Right
Certificates on such record date Right Certificates evidencing, subject to
Section 14 hereof, the additional Rights to which such holders shall be entitled
as a result of such adjustment, or, at the option of the Company, shall cause to
be distributed to such holders of record in substitution and replacement for the
Right Certificates held by such holders prior to the date of adjustment, and
upon surrender thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders shall be entitled after such
adjustment. Right Certificates so to be distributed shall be issued, executed
and countersigned in the manner provided for herein (and may bear, at the option
of the Company, the adjusted Purchase Price) and shall be registered in the
names of the holders of record of Right Certificates on the record date
specified in the public announcement.
(l) Irrespective of any adjustment or change in the
Purchase Price or the number of shares of Series AA Preferred Stock issuable
upon the exercise of the Rights, the Right Certificates theretofore and
thereafter issued may continue to express the Purchase Price and the number of
shares which were expressed in the initial Right Certificates issued hereunder.
(m) Before taking any action that would cause an
adjustment reducing the Purchase Price below the then par value, if any, of the
shares of Common Stock or other securities and below one one-hundredth of the
then par value, if any, of the Series AA Preferred Stock, issuable upon exercise
of the Rights, the Company shall take any corporate action which may, in the
opinion of its counsel, be necessary in order that the Company may validly and
legally issue fully paid and nonassessable shares of such Series AA Preferred
Stock, Common Stock or other securities at such adjusted Purchase Price. If upon
any exercise of the Rights, a holder is to receive a combination of Common Stock
and common stock equivalents, a portion of the consideration paid upon such
exercise, equal to at least the then par value of a share of Common Stock of the
Company, shall be allocated as the payment for each share of Common Stock of the
Company so received.
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(n) 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 (with prompt notice
thereof to the Rights Agent) until the occurrence of such event the issuing to
the holder of any Right exercised after such record date the shares of Series AA
Preferred Stock and other capital stock or securities of the Company, if any,
issuable upon such exercise over and above the shares of Series AA Preferred
Stock and other capital stock or securities of the Company, if any, issuable
upon such exercise on the basis of the Purchase Price in effect prior to such
adjustment; provided, however, that the Company shall deliver to such holder a
due ▇▇▇▇ or other appropriate instrument evidencing such holder's right to
receive such additional shares upon the occurrence of the event requiring such
adjustment.
(o) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such reductions in the
Purchase Price, in addition to those adjustments expressly required by this
Section 11, as and to the extent that in their good faith judgment a majority of
the Board of Directors shall determine to be advisable in order that any (i)
consolidation or subdivision of the Series AA Preferred Stock, (ii) issuance
wholly for cash of any Series AA Preferred Stock at less than the then current
market price, (iii) issuance wholly for cash of Series AA Preferred Stock or
securities which by their terms are convertible into or exchangeable for Series
AA Preferred Stock, (iv) dividends on Series AA Preferred Stock payable in
Series AA Preferred Stock or (v) issuance of rights, options or warrants
referred to hereinabove in this Section 11, hereafter made by the Company to the
holders of its Series AA Preferred Stock, shall not be taxable to such
stockholders.
(p) In the event that at any time after the date of this
Rights Agreement and prior to the Distribution Date, the Company shall (i)
declare or pay any dividend on the Common Stock payable in shares of Common
Stock or (ii) effect a subdivision, combination or consolidation of the Common
Stock (by reclassification or otherwise than by payment of dividends in shares
of Common Stock) into a greater or lesser number of shares of Common Stock, then
in any such case (y) the number of one one-hundredths of a share of Series AA
Preferred Stock purchasable after such event upon proper exercise of each Right
shall be determined by multiplying the number of one one-hundredths of a share
of Series AA Preferred Stock so purchasable immediately prior to such event by a
fraction, the numerator of which is the number of shares of Common Stock
outstanding immediately before such event and the denominator of which is the
number of shares of Common Stock outstanding immediately after such event, and
(z) each share of Common Stock outstanding immediately after such event shall
have issued with respect to it that number of Rights which each share of Common
Stock outstanding immediately prior to such event had issued with respect to it.
The adjustments provided for in this Section 11(p) shall be made successively
whenever such a dividend is declared or paid or such a subdivision, combination
or consolidation is effected.
(q) The Company covenants and agrees that it shall not,
at any time after the Distribution Date, (i) consolidate with or merge with or
into, or enter into a statutory share exchange with, any other Person (other
than a Subsidiary of the Company in a transaction that complies with Section
11(r)), (ii) permit or cause any Person to consolidate with the Company, or
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merge with and into the Company (other than a Subsidiary of the Company in a
transaction that complies with Section 11(r)), or (iii) sell or otherwise
transfer (or permit any Subsidiary to sell or transfer), in one or more
transactions, assets or earning power aggregating 50% or more of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to any
other Person or Persons (other than the Company and/or any of its Subsidiaries
in one or more transactions, each of which complies with Section 11(r)), if at
the time of or immediately after such consolidation, merger, exchange or sale
there are any rights, warrants or other instruments or securities outstanding or
agreements in effect which would substantially diminish or otherwise eliminate
the benefits intended to be afforded by the Rights.
(r) The Company covenants and agrees that, after the Distribution
Date, it will not, except as permitted by Sections 23, 24 and 27 hereof, take
(or permit any Subsidiary of the Company to take) any action the purpose or
effect of which is to diminish substantially or otherwise eliminate the benefits
intended to be afforded by the Rights.
12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment (including without limitation an event which causes
Rights to become null and void) is made as provided in Sections 11 or 13 hereof,
the Company shall (a) promptly prepare a certificate setting forth such
adjustment or describing such event, and a brief statement of the facts,
computations and methodology accounting for such adjustment, (b) promptly file
with the Rights Agent and with each transfer agent for the Series AA Preferred
Stock and the Common Stock a copy of such certificate and (c) include a brief
summary thereof in a mailing to each holder of a Right Certificate in accordance
with Section 26 hereof, or prior to the Distribution Date, disclose a brief
summary in a filing under the Exchange Act. The Rights Agent shall be fully
protected in relying on any such certificate and on any adjustment or event
therein contained and shall have no duty with respect to and shall not be deemed
to have knowledge of any adjustment unless and until it shall have received such
a certificate.
13. Consolidation, Merger or Sale or Transfer of Assets or Earning
Power.
(a) In the event that, directly or indirectly, at any time after the
Distribution Date, (x) the Company shall consolidate with, merge with and into
or enter into a statutory share exchange with any other Person, (y) any Person
shall consolidate with or merge with and into the Company, and the Company shall
be the continuing or surviving corporation of such merger and, in connection
with such merger, all or part of the Common Stock shall be changed into or
exchanged for stock or other securities of any other Person (or the Company) 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 or
more transactions, assets or earning power aggregating 50% or more of the assets
or earning power of the Company and its Subsidiaries (taken as a whole) to any
other Person other than to the Company or one or more of its wholly owned
Subsidiaries (each of the events described in clauses (x), (y) and (z) of this
paragraph being referred to herein as a "Flip-over Event"), then, and in each
such case, proper provision shall be made so that (i) each holder of a Right,
subject to Section 7(e) hereof, shall thereafter have the right to receive, upon
the exercise thereof at the then current Purchase Price multiplied by the
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then number of one one-hundredths of a share of Series AA Preferred Stock for
which a Right is then exercisable in accordance with the terms of this Rights
Agreement, in lieu of Series AA Preferred Stock, such number of shares of freely
tradable Common Stock of the Principal Party (as hereinafter defined), free and
clear of liens, rights of call or first refusal, encumbrances or other adverse
claims, as shall be equal to the result obtained by (A) multiplying the then
current Purchase Price by the number of one one-hundredths of a share of Series
AA Preferred Stock for which a Right is then exercisable and dividing that
product by (B) 50% of the then current market price per share of the Common
Stock of such Principal Party (determined in the manner described in Section
11(f) hereof) on the date of consummation of such consolidation, merger,
exchange, sale or transfer; (ii) the Principal Party shall thereafter be liable
for, and shall assume, by virtue of such consolidation, merger, exchange, sale
or transfer, all the obligations and duties of the Company pursuant to this
Rights Agreement; (iii) the term "Company" shall thereafter be deemed to refer
to such Principal Party, it being specifically intended that the provisions of
Section 11 hereof, except for the provisions of 11(b), shall apply to such
Principal Party after the first occurrence of a Flip-over Event; and (iv) such
Principal Party shall take such steps (including, but not limited to, the
authorization and reservation of a sufficient number of shares of its Common
Stock to permit exercise of all outstanding Rights in accordance with this
Section 13(a)) in connection with such consummation as may be necessary to
assure that the provisions hereof shall thereafter be applicable, as nearly as
reasonably may be, in relation to the shares of its Common Stock thereafter
deliverable upon the exercise of the Rights.
(b) "Principal Party" shall mean:
(i) in the case of any transaction described in clause (x) or
(y) of the first sentence of Section 13(a) hereof, the Person that is the issuer
of any securities into which shares of Common Stock of the Company are converted
in such merger or consolidation, or for which shares of Common Stock of the
Company are exchanged, and if no securities are so issued, the Person, including
the Company, that is the other party to the merger, consolidation or share
exchange; 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; provided, however, that in any
case described in clause (i) or (ii) in this Section 13(b), (x) 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 or Affiliate of another Person,
"Principal Party" shall refer to such other Person; (y) in case such Person is a
Subsidiary, directly or indirectly, or Affiliate of more than one Person, the
Common Stocks of all 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 current market price, and (z) in case such Person
is, or is owned directly or indirectly by, a partnership or joint venture formed
by two or more Persons that are not owned, directly or indirectly, by the same
Person, the rules set forth in (x) and (y) 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
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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 such consolidation, merger,
exchange, sale or transfer unless the Principal Party shall have a sufficient
number of shares of its authorized 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 each Principal
Party and each other Person who may become a Principal Party as a result of such
consolidation, merger, exchange, sale or transfer shall have executed and
delivered to the Rights Agent a supplemental agreement providing for the terms
set forth in paragraphs (a) and (b) of this Section 13 and further providing
that, as soon as practicable after the date of any consolidation, merger,
exchange, sale or transfer of assets mentioned in paragraph (a) of this Section
13, the Principal Party will:
(i) prepare and file a registration statement under the
Securities Act with respect to the Rights and the securities purchasable upon
exercise of the Rights on an appropriate form, use its best efforts to cause
such registration statement to become effective as soon as practicable after
such filing and use its best efforts to cause such registration statement to
remain effective (with a prospectus at all times meeting the requirements of the
Securities Act) until the Expiration Date;
(ii) use its best efforts to qualify or register the Rights and
the securities purchasable upon exercise of the Rights under the "blue sky" laws
of such jurisdictions as may be necessary or appropriate; and
(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 under the
Exchange Act.
The provisions of this Section 13 shall similarly apply to successive
mergers or consolidations or sales or other transfers. In the event that a
Flip-over Event shall occur at any time after the occurrence of a Flip-in Event,
the Rights which have not theretofore been exercised shall thereafter also
become exercisable in the manner described in Section 13(a) hereof.
(d) Notwithstanding anything in this Agreement to the contrary, this
Section 13 shall not be applicable to a transaction described in Section
13(a)(x), (y) or (z) if: (i) such transaction is consummated with a Person or
Persons who acquired Common Stock pursuant to a tender offer described in
Section 11(b)(ii) (or with a wholly owned Subsidiary of any such Person or
Persons), (ii) the price per share of Common Stock offered in such transaction
is not less than the price per share of Common Stock paid to all holders of
Common Stock whose shares were purchased pursuant to such tender or exchange
offer, and (iii) the form of consideration being offered to the remaining
holders of Common Stock pursuant to such transaction is the same as the
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form of consideration paid pursuant to such tender offer. Upon consummation of
any transaction contemplated by this Section 13(d), all Rights shall expire.
14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue fractions of Rights
or to distribute Right Certificates which evidence fractional Rights. In lieu of
such fractional Rights, there shall be paid to the registered holders of the
Right Certificates with regard to which such fractional Rights would otherwise
be issuable, an amount in cash equal to the same fraction of the current market
value of a whole Right. For the purposes of this Section 14(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 for any day shall be the last
sale price or, in case no such sale takes place on such day, the average of the
closing bid and asked prices, in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock Exchange or, if the Rights are not
listed or admitted to trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with respect to securities
listed or admitted to trading on the principal national securities exchange on
which the Rights are listed or admitted to trading or, if the Rights are not
listed or admitted to trading on any national securities exchange, as reported
by the Nasdaq National Market System or, if the Rights are not listed or
admitted to trading on any national securities exchange or included in the
Nasdaq National Market System, the last quoted price, or, if not so quoted, the
average of the high bid and low asked prices in the over-the-counter market, as
reported by Nasdaq or such other system then in use or, if on any such date the
Rights are not quoted by any such organization, the average of the closing bid
and asked prices as furnished by a professional market maker making a market in
the Rights selected by a majority of the Board of Directors. 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 a majority of the Board of
Directors shall be used.
(b) The Company shall not be required to issue fractions of shares
of Series AA Preferred Stock (other than fractions which are integral multiples
of one one-hundredth of a share of Series AA Preferred Stock) upon exercise of
the Rights or to distribute certificates which evidence fractional shares of
Series AA Preferred Stock (other than fractions which are integral multiples of
one one-hundredth of a share of Series AA Preferred Stock). Fractions of shares
of Series AA Preferred Stock in integral multiples of one one-hundredth of a
share of Series AA Preferred Stock may, at the election of the Company, be
evidenced by depositary receipts, pursuant to an appropriate agreement between
the Company and a depositary selected by it, provided that such agreement shall
provide that the holders of such depositary receipts shall have all the rights,
privileges and preferences to which they are entitled as beneficial owners of
the shares of Series AA Preferred Stock represented by such depositary receipts.
In lieu of fractional shares of Series AA Preferred Stock that are not integral
multiples of one one-hundredth of a share of Series AA Preferred Stock, the
Company may pay to the registered holders of Right Certificates at the time such
Right Certificates are exercised as herein provided an amount in cash
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equal to the same fraction of the current market value of one one-hundredths of
a share of Series AA Preferred Stock. For purposes of this Section 14(b), the
current market value of one one-hundredth of a share of Series AA Preferred
Stock shall be one one-hundredth of the closing price of a share of Series AA
Preferred Stock (as determined pursuant to Section 11(f)(ii) hereof) for the
Trading Day immediately prior to the date of such exercise.
(c) Following the occurrence of one of the transactions or events
specified in Section 11 hereof giving rise to the right to receive common stock
equivalents (other than Series AA Preferred Stock) or other securities upon the
exercise of a Right, the Company shall not be required to issue fractions of
shares or units of such common stock equivalents or other securities upon
exercise of the Rights or to distribute certificates which evidence fractional
shares of such common stock equivalents or other securities. In lieu of
fractional shares or units of such common stock equivalents or other securities,
the Company may pay to the registered holders of Right Certificates at the time
such Rights are exercised as herein provided an amount in cash equal to the same
fraction of the current market value of a share or unit of such common stock
equivalent or other securities. For purposes of this Section 14(c), the current
market value shall be determined in the manner set forth in Section 11(f) hereof
for the Trading Day immediately prior to the date of such exercise and, if such
common stock equivalent is not traded, each such common stock equivalent shall
have the value of one one-hundredth of a share of Series AA Preferred Stock.
(d) Except as otherwise expressly provided in this Section 14, the
holder of a Right by the acceptance of the Right expressly waives such holder's
right to receive any fractional Rights or any fractional share upon exercise of
Rights. The Rights Agent shall have no duty or obligation with respect to this
Section 14 and Section 24 unless and until it has received specific instructions
(and sufficient cash, if required) from the Company with respect to its duties
or obligation under such sections.
15. Rights of Action. All rights of action in respect of this Rights
Agreement, except for rights of action given to the Rights Agent under Section
18 or Section 20 hereof, are vested in the respective registered holders of the
Right Certificates (and, prior to the Distribution Date, the registered holders
of Common Stock); and any registered holder of any Right Certificate (or, prior
to the Distribution Date, of the Common Stock), without the consent of the
Rights Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Stock), may, in such holder's own behalf and
for such 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, such holder's right to exercise the Rights evidenced by such Right
Certificate in the manner provided in such Right Certificate and in this Rights
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 Rights Agreement
and will be entitled to specific performance of the obligations under, and
injunctive relief against actual or threatened violations of, the obligations of
any Person subject to this Rights Agreement. Holders of Rights shall be entitled
to recover from the Company the
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reasonable costs and expenses, including attorneys' fees, incurred by them in
any action to enforce the provisions of this Rights Agreement.
Notwithstanding anything in this Rights 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 Rights Agreement by reason of any preliminary or
permanent injunction or other order, decree or ruling issued by a court of
competent jurisdiction or by a governmental, regulatory or administrative agency
or commission, or any statute, rule, regulation or executive order promulgated
or enacted by any governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, the Company must use its best
efforts to prevent the issuance of such order, decree or ruling and to have any
such order, decree or ruling lifted or otherwise overturned as soon as possible.
16. Agreement of Right Holders. Every holder of a Right by accepting
the same consents and agrees with the Company and the Rights Agent and with
every other holder of a Right that:
(a) Prior to the Distribution Date, the Rights will be transferable
only in connection with the transfer of Common Stock;
(b) After the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered at
the office of the Rights Agent designated for such purpose, duly endorsed or
accompanied by a proper instrument of transfer; and
(c) The Company and the Rights Agent may deem and treat the Person
in whose name the Right Certificate (or, prior to the Distribution Date, the
associated Common Stock Certificate) is registered as the absolute owner thereof
and of the Rights evidenced thereby (notwithstanding any notations of ownership
or writing on the Right Certificate or the associated Common Stock certificate
made by anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent shall be affected by
any notice to the contrary.
17. Right Certificate Holder Not Deemed a Stockholder. No holder, as
such, of any Right Certificate shall be entitled to vote, receive dividends or
be deemed for any purpose the holder of Series AA Preferred Stock, Common Stock
or any other securities of the Company which may at any time be issuable on the
exercise of the Rights represented thereby, nor shall anything contained herein
or in any Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in Section 25 hereof), or to receive dividends
or subscription rights, or otherwise, until the Right or Rights evidenced by
such Right Certificate shall have been exercised in accordance with the
provisions hereof.
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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, its reasonable expenses and counsel fees and
other disbursements incurred in the preparation, execution, delivery,
administration and amendment of this Rights 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, damage,
judgment, fine, penalty, claim, demand, settlement, cost or expense (including,
without limitation, the reasonable fees and expenses of legal counsel), incurred
without gross negligence, bad faith or willful misconduct on the part of the
Rights Agent (which gross negligence, bad faith or willful misconduct must be
determined by a final, non-appealable order, judgment, decree or ruling of a
court of competent jurisdiction), for any action taken, suffered or omitted by
the Rights Agent in connection with the acceptance, administration, exercise and
performance of this Rights Agreement, including the costs and expenses of
defending against any claim of liability. The costs and expenses incurred in
enforcing this right of indemnification shall be paid by the Company. The
provisions of this Section 18 and Section 20 below shall survive the termination
of this Rights Agreement, the exercise or expiration of the Rights and the
resignation or removal of the Rights Agent.
(b) The Rights Agent shall be fully authorized and protected and
shall incur no liability for or in respect of any action taken, suffered or
omitted by it in connection with its acceptance and administration of this
Rights Agreement and the exercise and performance of its duties hereunder in
reliance upon any Right Certificate or certificate for Series AA Preferred
Stock, Common Stock or for other securities of the Company, instrument of
assignment or transfer, power of attorney, endorsement, affidavit, letter,
notice, direction, consent, certificate, statement, or other paper or document
believed by it to be genuine and to be signed, executed and, where necessary,
verified or acknowledged, by the proper Person or Persons, or otherwise upon the
advice of counsel as set forth in Section 20 hereof..
19. Merger or Consolidation or Change of Name of Rights Agent.
(a) Any Person into which the Rights Agent or any successor Rights
Agent may be merged or with which it may be consolidated, or any Person
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any Person succeeding to the
shareholder services business or the stock transfer business of the Rights Agent
or any successor Rights Agent, shall be the successor to the Rights Agent under
this Rights Agreement without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided that such Person
would be eligible for appointment as a successor Rights Agent under the
provisions of Section 21 hereof. In case at the time such successor Rights Agent
shall succeed to the agency created by this Rights Agreement, any of the Right
Certificates shall have been countersigned but not delivered, any such successor
Rights Agent may adopt the countersignature of the predecessor Rights Agent and
deliver such Right Certificates so countersigned; and in case at that time any
of the Right Certificates shall not have been countersigned, any successor
Rights Agent may countersign such Right Certificates either in the
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name of the predecessor Rights Agent or in the name of the successor Rights
Agent; and in all such cases such Right Certificates shall have the full force
provided in the Right Certificates and in this Rights Agreement.
(b) In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver Right Certificates so countersigned; and in
case at that time any of the Right Certificates shall not have been
countersigned, the Rights Agent may countersign such Right Certificates either
in its prior name or in its changed name; and in all such cases such Right
Certificates shall have the full force provided in the Right Certificates and in
this Rights Agreement.
20. Rights and Duties of Rights Agent. The Rights Agent undertakes to
perform only the duties and obligations expressly imposed by this Rights
Agreement upon the following terms and conditions, by all of which the Company
and the holders of Right Certificates, by their acceptance thereof, shall be
bound:
(a) The Rights Agent may consult with legal counsel (who may be
legal counsel for the Company or the Rights Agent), and the advice or opinion of
such counsel shall be full and complete authorization and protection to the
Rights Agent and the Rights Agent shall incur no liability for or in respect of
any action taken, suffered or omitted by it in good faith and in accordance with
such advice or opinion.
(b) Whenever in the performance of its duties under this Rights
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, suffering or omitting 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, Chief Executive Officer,
President, Chief Financial Officer or any Vice President and by the Treasurer or
any Assistant Treasurer or the Secretary or any Assistant Secretary of the
Company and delivered to the Rights Agent; and such certificate shall be full
and complete authorization and protection to the Rights Agent and the Rights
Agent shall incur no liability for or in respect of any action taken, suffered
or omitted in good faith by it under the provisions of this Rights 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 (which gross negligence, bad
faith or willful misconduct must be determined by a final, non-appealable order,
judgment, decree or ruling of a court of competent jurisdiction). Anything to
the contrary notwithstanding, in no event shall the Rights Agent be liable for
special, punitive, indirect, consequential or incidental loss or damage of any
kind whatsoever (including but not limited to lost profits), even if the Rights
Agent has been advised of the likelihood of such loss or damage. Any liability
of the Rights Agent under this Rights Agreement will be limited to the amount of
fees paid by the Company to the Rights Agent.
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(d) The Rights Agent shall not be liable for or by reason of any of
the statements of fact or recitals contained in this Rights Agreement or in the
Right Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be deemed to
have been made by the Company only.
(e) The Rights Agent shall not have any liability for or be under
any responsibility in respect of the validity of this Rights Agreement or the
execution and delivery hereof (except the due execution hereof by the Rights
Agent) or in respect of the validity or execution of any Right Certificate
(except its countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained in this Rights
Agreement or in any Right Certificate; nor shall it be responsible for any
adjustment required under the provisions of Sections 11 or 13 hereof or
responsible for the manner, method or amount of any such adjustment or the
ascertaining of the existence of facts that would require any such adjustment
(except with respect to the exercise of Rights evidenced by Right Certificates
after actual notice to the Rights Agent of any such adjustment); nor shall it by
any act hereunder be deemed to make any representation or warranty as to the
authorization or reservation of any shares of Series AA Preferred Stock or other
securities to be issued pursuant to this Rights Agreement or any Right
Certificate or as to whether any shares of Series AA Preferred Stock or other
securities will, when 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 Rights Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
advice or instructions with respect to the performance of its duties hereunder
from the Chairman of the Board, Chief Executive Officer, President, Chief
Financial Officer, 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 such
advice or instructions shall be full and complete authorization and protection
to the Rights Agent and it shall not be liable for or in respect to any action
taken or suffered or omitted to be taken by it in good faith in accordance with
advice or instructions of any such officer or for any delay in acting while
waiting for that advice or those instructions.
(h) The Rights Agent and any stockholder, director, affiliate
officer, employee, agent or representative of the Rights Agent may buy, sell or
deal in any of the Rights or other securities of the Company or become
pecuniarily interested in any transaction in which the Company may be
interested, or contract with or lend money to the Company or otherwise act as
fully and freely as though it were not the Rights Agent under this Rights
Agreement. Nothing herein shall preclude the Rights Agent or any stockholder,
director, affiliate, officer, employee, agent or representative from acting in
any other capacity for the Company or for any other Person.
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(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 (through
its directors, officers or employees) 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,
absent gross negligence, bad faith or willful misconduct in the selection and
continued employment thereof (which gross negligence, bad faith or willful
misconduct must be determined by a final, non-appealable order, judgment, decree
or ruling of a court of competent jurisdiction).
(j) No provision of this Rights Agreement shall require the Rights
Agent to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder or in the exercise of its
rights if there shall be reasonable grounds for believing that repayment of such
funds or adequate indemnification against such risk or liability is not
reasonably assured to it.
(k) If, with respect to any Rights Certificate surrendered to the
Rights Agent for exercise or transfer, the certificate attached to the form of
assignment or form of election to purchase, as the case may be, has either not
been completed or indicates an affirmative response to clause 1, clause 2
and/or, in the case of the certificate attached to the form of election to
purchase, clause 3 thereof, the Rights Agent shall not take any further action
with respect to such requested exercise of transfer without first consulting
with the Company.
21. Change of Rights Agent. The Rights Agent or any successor Rights
Agent may resign and be discharged from its duties under this Rights Agreement
upon 30 days' notice in writing mailed to the Company and to each transfer agent
of the Common Stock and Series AA Preferred Stock by registered or certified
mail, and to the holders of the Right Certificates by first-class mail. The
Company may remove the Rights Agent or any successor Rights Agent upon 30 days'
notice in writing, mailed to the Rights Agent or successor Rights Agent, as the
case may be, and to each transfer agent of the Common Stock and Series AA
Preferred Stock by registered or certified mail, and to the holders of the Right
Certificates by first-class mail or, prior to the Distribution Date, through any
filing made by the Company pursuant to the Exchange Act. 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 such removal or after
it has been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the holder of a Right Certificate
(which holder shall, with such notice, submit such holder's Right Certificate
for inspection by the Company), then the registered holder of any Right
Certificate may apply to any court of competent jurisdiction for the appointment
of a new Rights Agent. Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be (a) a Person organized and doing business
under the laws of the United States or of any state (so long as such Person is
authorized to do business in the State of New York or the State of California),
in good standing, having an office in the States of New York or California,
which is authorized under such laws to exercise shareholder services business or
stock transfer powers and is subject to supervision or examination by federal or
state authority and which has at the time of its
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appointment as Rights Agent a combined capital and surplus of at least $50
million, or (b) an affiliate of a Person 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 execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Not later than the effective
date of any such appointment the Company shall file notice thereof in writing
with the predecessor Rights Agent and each transfer agent of the Common Stock
and Series AA Preferred Stock, and mail a notice thereof in writing to the
registered holders of the Right Certificates or, prior to the Distribution Date,
through any filing made by the Company pursuant to the Securities Exchange Act
of 1934, as amended. Failure to give any notice provided for 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.
22. Issuance of New Right Certificates.
(a) Notwithstanding any of the provisions of this Rights Agreement
or of the Rights to the contrary, the Company may, at its option, issue new
Right Certificates evidencing Rights in such form as may be approved by a
majority of the Board of Directors then in office to reflect any adjustment or
change in the Purchase Price and the number or kind or class of shares of stock
or other securities or property purchasable under the Right Certificates made in
accordance with the provisions of this Rights Agreement.
(b) In addition, in connection with the issuance or sale of Common
Stock following the Distribution Date and prior to the redemption, exchange or
expiration of the Rights, the Company (a) shall with respect to shares of Common
Stock so issued or sold pursuant to the exercise of stock options or under any
employee benefit plan or arrangement, or upon the exercise, conversion or
exchange of securities hereinafter issued by the Company, and (b) may, in any
other case, if deemed necessary or appropriate by the Board of Directors, issue
Right Certificates representing the appropriate number of Rights in connection
with such issuance or sale; provided, however, that (i) no such Right
Certificates shall be issued if, and to the extent that, the Company shall be
advised by counsel that such issuance would create a significant risk of
material adverse tax consequences to the Company or the Person to whom such
Right Certificates would be issued, and (ii) no Right Certificate shall be
issued if, and to the extent that, appropriate adjustment shall otherwise have
been made in lieu of the issuance thereof.
23. Redemption and Termination.
(a) A majority of the Board of Directors then in office may, at its
option, at any time prior to the earlier of (i) the Close of Business on the
Stock Acquisition Date or (ii) the Close of Business on the Final Expiration
Date, elect to redeem all but not less than all of the then outstanding Rights
at a redemption price of $0.01 per Right, as appropriately adjusted to reflect
any stock split, stock dividend or similar transaction occurring after the date
hereof (such
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redemption price being hereinafter referred to as the "Redemption Price"). The
redemption of the Rights by the Board of Directors may be made effective at such
time, on such basis and with such conditions as the Board of Directors in its
sole discretion may establish.
(b) Immediately upon the action of a majority of the Board of
Directors then in office electing to redeem the Rights, evidence of which shall
be promptly filed with the Rights Agent, or, when appropriate, immediately upon
the time or satisfaction of such conditions as the Board of Directors may have
established, 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. The Company shall promptly
give public disclosure of any such redemption; provided, however, that the
failure to give, or any defect in, any such disclosure shall not affect the
validity of such redemption. Within 10 days after the action of the Board of
Directors ordering the redemption of the Rights, the Company shall give notice
of such redemption to the Rights Agent and to the holders of the then
outstanding Rights by mailing such notice to all such holders at their last
addresses as they appear upon the registry books of the Rights Agent or, prior
to the Distribution Date, on the registry books of the Transfer Agent for the
Common Stock. 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.
(c) Neither the Company nor any of its Affiliates or Associates may
redeem, acquire or purchase for value any Rights at any time in any manner other
than that specifically set forth in this Section 23 or Section 24 hereof and
other than in connection with the purchase of Common Stock prior to the
Distribution Date.
24. Exchange.
(a) The Board of Directors may, at its option, at any time after
any Person becomes an Acquiring Person, exchange all or part of the then
outstanding and exercisable Rights (which shall not include Rights that have
become null and void pursuant to the provisions of Section 7(e) hereof) for
Common Stock at an exchange ratio of one share of Common Stock per Right,
appropriately adjusted to reflect adjustments in the number of Rights pursuant
to Section 11 of this Rights Agreement (such exchange ratio being hereinafter
referred to as the "Exchange Ratio"). Notwithstanding the foregoing, the Board
of Directors shall not be empowered to effect such exchange at any time after
any Person (other than the Company, any Subsidiary of the Company, any employee
benefit plan or compensation arrangement of the Company or any such Subsidiary,
or any entity holding securities of the Company to the extent organized,
appointed or established by the Company or any such Subsidiary for or pursuant
to the terms of any such employee benefit plan or compensation arrangement),
together with all Affiliates and Associates of such Person, becomes the
Beneficial Owner of 50% or more of the Voting Power of the Company.
(b) Immediately upon the action of the Board of Directors ordering
the exchange of any Rights pursuant to paragraph (a) of this Section 24 and
without any further
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action and without any notice, the right to exercise such Rights shall terminate
and the only rights thereafter of holders of such Rights shall be to receive
that number of shares of Common Stock equal to the number of such Rights held by
such holder multiplied by the Exchange Ratio. The Company promptly shall give
public notice of any such exchange (with prompt notice thereof to the Rights
Agent); provided, however, that the failure to give, or any defect in, such
notice shall not affect the Rights Agent and validity of such exchange. The
Company promptly shall mail a notice of any such exchange to all of the holders
of such Rights at their last addresses as they appear upon the registry books of
the Rights Agent. Any notice which is mailed in the manner herein provided shall
be deemed given, whether or not the holder receives the notice. Each such notice
of exchange will state the method by which the exchange of Common Stock for
Rights will be effected and, in the event of any partial exchange, the number of
Rights which will be exchanged. Any partial exchange shall be effected pro rata
based on the number of Rights (other than Rights which have become void pursuant
to the provisions of Section 7(e) hereof) held by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the Company, at
its option, may substitute Series AA Preferred Stock (or equivalent Series AA
Preferred stock, as such term is defined in Section 11(d) hereof) for Common
Stock exchangeable for Rights, at the initial rate of one one-hundredth of a
share of Series AA Preferred Stock (or equivalent Series AA Preferred stock) for
each share of Common Stock, as appropriately adjusted to reflect adjustments in
the voting rights of the Series AA Preferred Stock pursuant to the terms
thereof, so that the fraction of a share of Series AA Preferred Stock delivered
in lieu of each share of Common Stock shall have the same voting rights as one
share of Common Stock.
(d) In the event that there shall not be sufficient shares of
Common Stock or Series AA Preferred Stock (or equivalent Series AA Preferred
stock) authorized but unissued to permit any exchange of Rights as contemplated
in accordance with this Section 24, the Company shall take all such action as
may be necessary to authorize additional shares of Common Stock or Series AA
Preferred Stock (or equivalent Series AA Preferred stock) for issuance upon
exchange of the Rights.
(e) The Company shall not be required to issue fractions of Common
Stock or to distribute certificates which evidence fractional shares of Common
Stock. In lieu of such fractional shares of Common Stock, the Company shall pay
to the registered holders of the Right Certificates with regard to which such
fractional shares of Common Stock would otherwise be issuable an amount in cash
equal to the same fraction of the current market value of a whole share of
Common Stock. For the purposes of this paragraph (e), the current market value
of a whole share of Common Stock shall be the current market price of a share of
Common Stock (as determined pursuant to the second sentence of Section 11(f)(i)
hereof) for the Trading Day immediately prior to the date of exchange pursuant
to this Section 24.
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25. Notice of Proposed Actions.
(a) In case the Company shall propose at any time after the
Distribution Date (a) to pay any dividend payable in stock of any class to the
holders of the Series AA Preferred Stock or to make any other distribution to
the holders of the Series AA Preferred Stock (other than a regular periodic cash
dividend out of earnings or retained earnings of the Company), (b) to offer to
the holders of the Series AA Preferred Stock rights or warrants to subscribe for
or to purchase any additional shares of Series AA Preferred Stock or shares of
stock of any other class or any other securities, rights or options, (c) to
effect any reclassification of the Series AA Preferred Stock (other than a
reclassification involving only the subdivision of outstanding shares of Series
AA Preferred Stock), (d) to effect any consolidation or merger into or with, or
any statutory share exchange with, or to effect any sale or other transfer (or
to permit one or more of its Subsidiaries to effect any sales or other
transfer), in one or more transactions, of 50% or more of the assets or earning
power of the Company and its Subsidiaries (taken as a whole) to, any other
Person, (e) to effect the liquidation, dissolution or winding up of the Company,
or (f) to declare or pay any dividend on the Common Stock payable in Common
Stock or to effect a subdivision, combination or consolidation of the Common
Stock (by reclassification or otherwise than by payment of dividends in Common
Stock), then, in each such case, the Company shall give to each holder of a
Right and the Rights Agent, in accordance with Section 26 hereof, a notice of
such proposed action, which shall specify the record date for the purposes of
such stock dividend, distribution of rights or warrants, or the date on which
such reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution, or winding up is to take place and the date of participation
therein by the holders of the Common Stock and/or Series AA Preferred Stock, if
any such date is to be fixed. Such notice shall be so given in the case of any
action covered by clauses (a) or (b) above at least ten days prior to the record
date for determining holders of the Series AA Preferred Stock for purposes of
such action, and in the case of any such other action, at least ten days prior
to the date of the taking of such proposed action or the date of participation
therein by the holders of Series AA Preferred Stock, whichever shall be the
earlier. The failure to give notice required by this Section 25 or any defect
therein shall not affect the legality or validity of the action taken by the
Company or the vote upon any such action.
(b) In case a Flip-in Event shall occur, then the Company shall as
soon as practicable thereafter give to each holder of a Right Certificate, in
accordance with Section 26 hereof, a notice of the occurrence of such event,
which shall specify the event and the consequences of the event to holders of
Rights under Section 11(b) hereof.
26. Notices. Notices or demands authorized by this Rights Agreement to
be given or made by the Rights Agent or by the holder of any Right Certificate
to or on the Company shall be 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:
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TriCo Bancshares
▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Subject to the provisions of Section 21 hereof, any notice or demand authorized
by this Rights Agreement to be given or made by the Company or by the holder of
any Right Certificate to or on the Rights Agent shall be sufficiently given or
made if sent by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Company) as follows:
Mellon Investor Services LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Relationship Manager
With a copy to:
Mellon Investor Services LLC
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: General Counsel
Notices or demands authorized by this Rights Agreement to be given or made by
the Company or the Rights Agent to the holder of any Right Certificate (or prior
to the Distribution Date, any Common Stock) 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.
27. Supplements and Amendments. The Company may from time to time
supplement or amend this Rights Agreement without the approval of any holders of
Right Certificates in order (a) to cure any ambiguity, (b) to correct or
supplement any provision contained herein which may be defective or inconsistent
with any other provisions herein, (c) to shorten or lengthen any time period
hereunder (including without limitation to extend the Final Expiration Date),
(d) increase or decrease the Purchase Price, or (e) to change or supplement the
provisions hereunder in any manner which the Company may deem necessary or
desirable; provided, however, that from and after such time as any Person
becomes an Acquiring Person, this Rights Agreement shall not be amended in any
manner which would adversely affect the interests of the holders of Rights;
provided further that this Rights Agreement may not be supplemented or amended
to lengthen pursuant to clause (c) of this sentence, (A) the time period
relating to the when the Rights may be redeemed at such time as the Rights are
not then redeemable, or (B) any other time period unless such lengthening is for
the purpose of protecting, enhancing or clarifying the rights of, and/or the
benefits to, the holders of the Rights; provided further that the Company shall
have the right to make unilaterally any changes necessary to facilitate the
appointment of a successor Rights Agent, which such changes shall be set forth
in a writing by the Company or by the Company and such
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successor Rights Agent. Without limiting the foregoing, the Company may at any
time prior to such time as any Person becomes an Acquiring Person amend this
Rights Agreement to lower the thresholds set forth in Sections 1(a) and 3(a)
hereof from 15% to not less than the greater of (i) any percentage greater than
the largest percentage of the Voting Power of the Company then known by the
Company to be beneficially owned by any Person (other than the Company, any
Subsidiary of the Company, or any employee benefit plan or compensation
arrangement of the Company or any Subsidiary of the Company, and any entity
holding securities of the Company to the extent organized, appointed or
established by the Company or any such Subsidiary for or pursuant to the terms
of any such employee benefit plan or compensation arrangement) together with all
Affiliates and Associates of such Person and (ii) 10%. Upon the delivery of a
certificate from an appropriate officer of the Company and, if requested by the
Rights Agent, an opinion of counsel, which states that the proposed supplement
or amendment is in compliance with the terms of this Section 27 and such
supplement or amendment does not increase the Rights Agent's duties, liabilities
or obligations, the Rights Agent shall execute such supplement or amendment.
28. Successors. All the covenants and provisions of this Rights
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.
29. Benefits of This Rights Agreement. Nothing in this Rights Agreement
shall be construed to give to any Person other than the Company, the Rights
Agent and the registered holders of the Right Certificates (and, prior to the
Distribution Date, the Common Stock) any legal or equitable right, remedy or
claim under this Rights Agreement; but this Rights Agreement shall be for the
sole and exclusive benefit of the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date, the
Common Stock).
30. Severability. If any term, provision, covenant or restriction of
this Rights 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 Rights Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated.
It is the intent of the parties hereto to enforce the remainder of the terms,
provisions, covenants and restrictions of this Rights Agreement to the maximum
extent permitted by law.
31. Governing Law. This Rights Agreement and each Right Certificate
issued hereunder shall be deemed to be a contract made under the laws of the
State of California and for all purposes shall be governed by and construed in
accordance with the laws of such State applicable to contracts to be made and
performed entirely within such state; provided, however, that all provisions
regarding the rights, duties and obligations of the Rights Agent shall be
governed by and construed in accordance with the laws of the State of New York
applicable to contracts made and to be performed entirely within such state.
32. Counterparts. This Rights 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.
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33. Descriptive Headings. Descriptive headings of the several Sections
of this Rights Agreement are inserted for convenience only and shall not control
or affect the meaning or construction of any of the provisions hereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Rights
Agreement to be duly executed, all as of the day and year first above written.
TRICO BANCSHARES
By:
--------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President and CEO
MELLON INVESTOR SERVICES LLC, as Rights
Agent
By:
--------------------------------------
Name:
---------------------------------
Title:
--------------------------------
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EXHIBIT A
CERTIFICATE OF DETERMINATION
OF PREFERENCES OF
SERIES AA JUNIOR PARTICIPATING PREFERRED STOCK
OF
TRICO BANCSHARES,
A CALIFORNIA CORPORATION
The undersigned, ▇▇▇▇▇▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, DO HEREBY CERTIFY
that:
A. They are the duly elected and acting President/CEO and Chief
Financial Officer/Vice President, respectively, of TriCo Bancshares, a
California corporation (the "Corporation").
B. The authorized number of shares of Preferred Stock is 1,000,000. The
authorized number of Series AA Junior Participating Preferred Stock is 150,000,
none of which have been issued.
C. Pursuant to the authority vested in the Board of Directors in
accordance with the provisions of the Articles of Incorporation of the said
Corporation, the said Board of Directors on June 12, 2001, adopted the following
resolutions creating a series of 150,000 shares of Preferred Stock designated as
"Series AA Junior Participating Preferred Stock":
WHEREAS, the Articles of Incorporation of the Corporation authorize a
class of Preferred Stock comprising 1,000,000 shares issuable from time
to time in one or more series; and
WHEREAS, the Board of Directors of the Corporation is authorized to fix
or alter the rights, preferences, privileges and restrictions granted
to or imposed upon any wholly unissued series of Preferred Stock,
including but not limited to the dividend rights, dividend rates,
conversion rights, voting rights and the liquidation preferences, and
the number of shares constituting any such series and the designation
thereof, or any of them; and
WHEREAS, the Corporation heretofore has not issued or designated any
series of Preferred Stock, and it is the desire of the Board of
Directors of the Corporation, pursuant to its authority as aforesaid,
to fix the rights, preferences, restrictions and other matters relating
to Series AA Junior Participating Preferred Stock and the number of
shares constituting such series;
NOW, THEREFORE, BE IT RESOLVED, that pursuant to the authority vested
in the Board of Directors of this Corporation in accordance with the
provisions of the Articles of Incorporation, a series of Preferred
Stock, no par value, of the Corporation be and hereby is created, and
that the designation and number of shares thereof and the voting and
other powers, preferences and relative, participating, optional or
other rights of the shares of such series and the qualifications,
limitations and restrictions thereof are as follows:
41
1. Designation and Amount. The shares of such series shall be designated as
"Series AA Junior Participating Preferred Stock" (the "Series AA Preferred
Stock") and the number of shares constituting the Series AA Preferred Stock
shall be One Hundred Fifty Thousand (150,000). Such number of shares may be
increased or decreased by resolution of the Board of Directors; provided that no
decrease shall reduce the number of shares of Series AA Preferred Stock to a
number less than the number of shares then outstanding plus the number of shares
reserved for issuance upon the exercise of outstanding options, rights or
warrants or upon the conversion of any outstanding securities issued by the
Corporation convertible into Series AA Preferred Stock.
2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any series of Series
AA Preferred stock (or any similar stock) ranking prior and superior to the
Series AA Preferred Stock with respect to dividends, the holders of shares of
Series AA Preferred Stock, in preference to the holders of shares of Common
Stock, and of any other junior stock, shall be entitled to receive, when, as and
if declared by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on any regular quarterly dividend
payment date as shall be established by the Board of Directors (each such date
being referred to herein as a "Quarterly Dividend Payment Date"), commencing on
the first Quarterly Dividend Payment Date after the first issuance of a share or
fraction of a share of Series AA Preferred Stock, in an amount per share
(rounded to the nearest cent) equal to the greater of (a) $1 or (b) subject to
the provision for adjustment hereinafter set forth, 100 times the aggregate per
share amount of all cash dividends, and 100 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other distributions, other than a
dividend payable in shares of Common Stock or a subdivision of the outstanding
shares of Common Stock (by reclassification or otherwise), declared on the
Common Stock since the immediately preceding Quarterly Dividend Payment Date or,
with respect to the first Quarterly Dividend Payment Date, since the first
issuance of any share or fraction of a share of Series AA Preferred Stock. In
the event the Corporation shall at any time after July 10, 2001 (the "Rights
Declaration Date"), declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of Common Stock (by reclassification or otherwise than
by payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the amount to which
holders of shares of Series AA Preferred Stock were entitled immediately prior
to such event under clause (b) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on the Series AA
Preferred Stock as provided in paragraph (A) of this Section immediately after
it declares a dividend or distribution on the Common Stock (other than a
dividend payable in shares of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on the Common Stock during the
period between any Quarterly Dividend Payment Date and the next subsequent
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Quarterly Dividend Payment Date, a dividend of $1 per share on the Series AA
Preferred Stock shall nevertheless be payable on such subsequent Quarterly
Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on outstanding shares of
Series AA Preferred Stock from the Quarterly Dividend Payment Date next
preceding the date of issue of such shares, unless the date of issue of such
shares is prior to the record date for the first Quarterly Dividend Payment
Date, in which case dividends on such shares shall begin to accrue from the date
of issue of such shares, or unless the date of issue is a Quarterly Dividend
Payment Date or is a date after the record date for the determination of holders
of shares of Series AA Preferred Stock entitled to receive a quarterly dividend
and before such Quarterly Dividend Payment Date, in either of which events such
dividends shall begin to accrue and be cumulative from such Quarterly Dividend
Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends
paid on the shares of Series AA Preferred Stock in an amount less than the total
amount of such dividends at the time accrued and payable on such shares shall be
allocated pro rata on a share-by-share basis among all such shares at the time
outstanding. The Board of Directors may, in accordance with applicable law, fix
a record date for the determination of holders of shares of Series AA Preferred
Stock entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be not more than such number of days prior to
the date fixed for the payment thereof as may be allowed by applicable law.
3. Voting Rights. The holders of shares of Series AA Preferred Stock shall have
the following voting rights:
(A) Each share of Series AA Preferred Stock shall entitle the holder thereof to
100 votes on all matters submitted to a vote of the stockholders of the
Corporation.
(B) Except as otherwise provided in the Corporation's Articles of Incorporation
(as amended hereby), or by law, the holders of shares of Series AA Preferred
Stock, the holders of shares of Common Stock, and the holders of shares of any
other capital stock of the Corporation having general voting rights, shall vote
together as one class on all matters submitted to a vote of stockholders of the
Corporation.
(C) Except as set forth in the Corporation's Articles of Incorporation (as
amended hereby), and except as otherwise provided by law, holders of Series AA
Preferred Stock shall have no special voting rights and their consent shall not
be required (except to the extent they are entitled to vote with holders of
Common Stock as set forth herein) for taking any corporate action.
4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions payable on
the Series AA Preferred Stock as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and distributions, whether
or not declared, on shares of Series AA Preferred Stock outstanding shall have
been paid in full, the Corporation shall not:
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(i) declare or pay dividends, or make any other distributions, on any shares of
stock ranking junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series AA Preferred Stock;
(ii) declare or pay dividends, or make any other distributions, on any shares of
stock ranking on a parity (either as to dividends or upon liquidation,
dissolution or winding up) with the Series AA Preferred Stock, except dividends
paid ratably on the Series AA Preferred Stock and all such parity stock on which
dividends are payable or in arrears in proportion to the total amounts to which
the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration shares of any
stock ranking junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series AA Preferred Stock, provided that the Corporation may
at any time redeem, purchase or otherwise acquire shares of any such junior
stock in exchange for shares of any stock of the Corporation ranking junior
(either as to dividends or upon dissolution, liquidation or winding up) to the
Series AA Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for consideration any shares of
Series AA Preferred Stock, or any shares of stock ranking on a parity with the
Series AA Preferred Stock, except in accordance with a purchase offer made in
writing or by publication (as determined by the Board of Directors) to all
holders of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other relative rights
and preferences of the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the respective series or
classes.
(b) The Corporation shall not permit any subsidiary of the Corporation to
purchase or otherwise acquire for consideration any shares of stock of the
Corporation unless the Corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in such manner.
5. Reacquired Shares. Any shares of Series AA Preferred Stock purchased or
otherwise acquired by the Corporation in any manner whatsoever shall become
authorized but unissued shares of Series AA Preferred Stock and may be reissued
as part of a new series of Series AA Preferred Stock subject to the conditions
and restrictions on issuance set forth in the Articles of Incorporation, as
amended hereby, and by any subsequent amendments, or as otherwise required by
law.
6. Liquidation, Dissolution or Winding Up. Upon any liquidation, dissolution or
winding up of the Corporation, no distribution shall be made (1) to the holders
of shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series AA Preferred Stock unless, prior
thereto, the holders of shares of Series AA Preferred Stock shall have received
$100.00 per share, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such payment,
provided that the holders of shares of Series AA Preferred Stock shall be
entitled to receive an aggregate amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 100 times the
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44
aggregate amount to be distributed per share to holders of shares of Common
Stock, or (2) to the holders of shares of stock ranking on a parity (either as
to dividends or upon liquidation, dissolution or winding up) with the Series AA
Preferred Stock, except distributions made ratably on the Series AA Preferred
Stock and all such parity stock in proportion to the total amounts to which the
holders of all such shares are entitled upon such liquidation, dissolution or
winding up. In the event the Corporation shall at any time after the Rights
Declaration Date declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of Common Stock (by reclassification or otherwise than
by payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the aggregate amount to
which holders of shares of Series AA Preferred Stock were entitled immediately
prior to such event under the provision in clause (1) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
7. Consolidation, Merger, Etc. In case the Corporation shall enter into any
consolidation, merger, statutory share exchange, combination or other
transaction in which the shares of Common Stock are exchanged for or changed
into other stock or securities, cash and/or any other property, then in any such
case each share of Series AA Preferred Stock shall at the same time be similarly
exchanged or changed into an amount per share, subject to the provision for
adjustment hereinafter set forth, equal to 100 times the aggregate amount of
stock, securities, cash and/or any other property (payable in kind), as the case
may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the Corporation shall at any time after the Rights
Declaration Date declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of Common Stock (by reclassification or otherwise than
by payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the amount set forth in
the preceding sentence with respect to the exchange or change of shares of
Series AA Preferred Stock shall be adjusted by multiplying such amount by a
fraction, the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is the
number of shares of Common Stock that are outstanding immediately prior to such
event.
8. No Redemption. The shares of Series AA Preferred Stock shall not be
redeemable.
9. Rank. The Series AA Preferred Stock shall rank, with respect to the payment
of dividends and the distribution of assets, junior to all series of any other
class of the Corporation's Preferred Stock.
10. Amendment. The Articles of Incorporation of the Corporation shall not be
amended in any manner which would materially alter or change the powers,
preferences or special rights of the Series AA Preferred Stock so as to affect
them adversely without the affirmative vote of the
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holders of at least two-thirds of the outstanding shares of Series AA Preferred
Stock, voting together as a single class.
11. Fractional Shares. Series AA Preferred Stock may be issued in fractions of a
share which shall entitle the holder, in proportion to such holder's fractional
shares, to exercise voting rights, receive dividends, participate in
distributions and to have the benefit of all other rights of holders of Series
AA Preferred Stock.
The undersigned declare under the penalty of perjury that the
matters set forth in the foregoing certificate are true and correct of their own
knowledge.
Executed at Chico, California, on June 28, 2001.
By:
-----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President and CEO
By:
-----------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Chief Financial
Officer and Vice President
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EXHIBIT B
[Form of Right Certificate]
Certificate No. R- Rights
----------- ----
NOT EXERCISABLE AFTER THE EXPIRATION DATE. AT THE OPTION OF THE CORPORATION, THE
RIGHTS ARE SUBJECT TO REDEMPTION AT $0.01 PER RIGHT OR EXCHANGE FOR COMMON
STOCK, UNDER THE CIRCUMSTANCES AND ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN
ACQUIRING PERSON OR AN ASSOCIATE OR AFFILIATE OF AN ACQUIRING PERSON AND ANY
SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND VOID. [THE RIGHTS
REPRESENTED BY THIS RIGHT CERTIFICATE WERE ISSUED TO A PERSON WHO WAS AN
ACQUIRING PERSON OR AN AFFILIATE OR AN ASSOCIATE OF AN ACQUIRING PERSON. THIS
RIGHT CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY ARE VOID IN THE
CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS AGREEMENT.]*
Right Certificate
TRICO BANCSHARES
This certifies that _______________, or registered assigns, is the
registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the Rights
Agreement dated as of June 25, 2001 (the "Rights Agreement"), between TriCo
Bancshares, a California corporation (the "Company"), and Mellon Investor
Services LLC, a New Jersey limited liability company (the "Rights Agent"), to
purchase from the Company at any time after the Distribution Date (as such term
is defined in the Rights Agreement) and prior to 5:00 p.m. Chico, California,
time on the Expiration Date, as that term is defined in the Rights Agreement, at
the office designated for such purpose by the Rights Agent, or its successor as
Rights Agent, one one-hundredth of a fully paid, nonassessable share of the
Series AA Junior Participating Preferred Stock, no par value ("Series AA
Preferred Stock"), of the Company, at a purchase price of $49.00 per one
one-hundredth of a share (the "Purchase Price") upon presentation and surrender
of this Right Certificate with the Form of Election to Purchase duly executed.
The number of Rights evidenced by this Right Certificate (and the number of
shares which may be purchased upon exercise of each Right) and the Purchase
Price set forth above, are the number and Purchase Price as of July 10, 2001,
based on the shares of Series AA Preferred Stock of the Company as constituted
at such date.
* The portion of the legend in brackets shall be inserted only if applicable and
shall replace the preceding sentence.
▇-▇
▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ Price and the number of shares of Series AA Preferred Stock
which may be purchased upon the exercise of each of the Rights evidenced by this
Right Certificate are subject to modification and adjustment upon the happening
of certain events as provided in the Rights Agreement.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the Rights Agreement are on file at the Company and the above-mentioned office
of the Rights Agent and are also available upon written request to the Company.
This Right Certificate, with or without other Right Certificates, upon
surrender at the office designated for such purpose by of the Rights Agent, may
be exchanged for another Right Certificate or Right Certificates of like tenor
and date evidencing Rights entitling the holder to purchase a like aggregate
number of shares of Series AA Preferred Stock as the Rights evidenced by the
Right Certificate or Right Certificates surrendered shall have entitled such
holder to purchase. If this Right Certificate shall be exercised in part, the
holder shall be entitled to receive, upon surrender hereof, another Right
Certificate or Right Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Certificate may be redeemed by the Company at its option at a redemption
price of $0.01 per Right on or prior to the Stock Acquisition Date (as defined
in the Rights Agreement). In addition, subject to the provisions of the Rights
Agreement, each Right evidenced by this Certificate may be exchanged by the
Company at its option for one share of Common Stock following the Stock
Acquisition Date and prior to the time an Acquiring Person, as that term is
defined in the Rights Agreement, owns 50% or more of the Voting Power, as that
term is defined in the Rights Agreement, of the Company.
No fractional shares of Series AA Preferred Stock will be issued upon the
exercise of any Rights evidenced hereby (other than fractions which are integral
multiples of one one-hundredth of a share of Series AA Preferred Stock, which
may, at the election of the Company, be evidenced by depositary receipts). In
lieu of fractions of a share, a cash payment will be made, as provided in the
Rights Agreement.
No holder of this Right Certificate shall be entitled to vote or receive
dividends or be deemed for any purpose the holder of shares of Series AA
Preferred Stock or of any other securities of the Company which may at any time
be issuable on the exercise hereof, nor shall anything contained in the Rights
Agreement or herein be construed to confer upon the holder hereof, as such, any
of the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting stockholders
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(except as provided in the Rights Agreement), or to receive dividends or
subscription rights, or otherwise, until the Rights evidenced by this Right
Certificate shall have been exercised as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal
Dated as of .
------------------
TRICO BANCSHARES
By:
-----------------------------------
Its:
-------------------------------
Title:
-----------------------------
Countersigned:
MELLON INVESTOR SERVICES LLC,
as Rights Agent
By:
-----------------------------------
Its:
-------------------------------
Title:
-----------------------------
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[FORM OF REVERSE SIDE OF RIGHT CERTIFICATE]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR VALUE RECEIVED ____________________________ hereby sells, assigns
and transfers unto______________________________________________________________
(Please print name and address of transferee)
this Right Certificate, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint _____________ Attorney to
transfer the within Right Certificate on the books of the within-named Company,
with full power of substitution.
Dated as of
------------------ ------------------------------------------
Signature
(Signature must conform in all respects to
name of holder as specified on the face of
this Right Certificate)
Signature Guaranteed:
Signatures must be guaranteed by a member or a participant in the
Securities Transfer Agent Medallion Program, the New York Stock Exchange
Medallion Signature Program or the Stock Exchange Medallion Program.
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
1. This Right Certificate [ ] is [ ] is not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person or an
Affiliate or Associate of any such Acquiring Person (as such terms are defined
pursuant to the Rights Agreement);
2. After due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Right Certificate from
any Person who is, was or subsequently became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person.
Dated as of
------------------ ------------------------------------------
Signature
(Signature must conform in all respects to
name of holder as specified on the face of
this Right Certificate)
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FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise the Right Certificate.)
To TriCo Bancshares:
The undersigned hereby irrevocably elects to exercise
___________________ Rights represented by this Right Certificate to purchase the
shares of Series AA Preferred Stock issuable upon the exercise of such Rights
and requests that certificates for such shares be issued in the name of:
Name:
---------------------------------------------
Address:
-----------------------------------------
-----------------------------------------
Social security or taxpayer identification
number:
-------------------------------------------
If such number of Rights shall not be all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:
Name:
---------------------------------------------
Address:
-----------------------------------------
-----------------------------------------
Social security or taxpayer identification
number:
-------------------------------------------
Dated:
--------------------
------------------------------------------
Signature
(Signature must conform in all respects to
name of holder as specified on the face of
this Right Certificate)
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Signature Guaranteed:
Signatures must be guaranteed by a member or a participant in the
Securities Transfer Agent Medallion Program, the New York Stock Exchange
Medallion Signature Program or the Stock Exchange Medallion Program.
CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
1. The Rights evidenced by this Right Certificate [ ] are [ ] are not
being exercised by or on behalf of a Person who is or was an Acquiring Person or
an Affiliate or Associate of any such Acquiring Person (as such terms are
defined pursuant to the Rights Agreement);
2. 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
Affiliate or Associate of any such Acquiring Person (as such terms are defined
pursuant to the Rights Agreement);
3. After due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Right Certificate from
any Person who is, was or became an Acquiring Person or an Affiliate or
Associate of an Acquiring Person.
Dated:
--------------------
------------------------------------------
Signature
(Signature must conform in all respects to
name of holder as specified on the face of
this Right Certificate)
NOTICE
The signature in the foregoing Forms of Assignment and Election must
conform to the name as written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.
In the event the certification set forth above in the form of
Assignment or the form of Election to Purchase, as the case may be, is not
completed, the Company and the Rights Agent will deem the beneficial owner of
the Rights evidenced by this Right Certificate to be an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored as described in Section
7(e) of the Rights Agreement.
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EXHIBIT C
TRICO BANCSHARES
SUMMARY OF SERIES AA PREFERRED STOCK
PURCHASE RIGHTS
On June 12, 2001, the Board of Directors of TriCo Bancshares (the
"Company") declared a dividend of one preferred share purchase right (a "Right")
for each outstanding share of common stock, no par value (the "Common Stock").
The dividend is payable to the stockholders of record on July 10, 2001.
Our Board has adopted this Rights Agreement to protect stockholders
from coercive or otherwise unfair takeover tactics. In general terms, it works
by imposing a significant penalty upon any person or group that acquires 15% or
more of our outstanding common stock without the approval of our Board. The
Rights Agreement should not interfere with any merger or other business
combination approved by our Board.
For those interested in the specific terms of the Rights Agreement as
made between our Company and Mellon Investor Services LLC, as the Rights Agent,
on June 25, 2001, we provide the following summary description. Please note,
however, that this description is only a summary, and is not complete, and
should be read together with the entire Rights Agreement, which has been filed
with the Securities and Exchange Commission as an exhibit to a Registration
Statement on Form 8-A dated June 28, 2001. A copy of the Rights Agreement is
available free of charge from our Company.
THE RIGHTS. Our Board authorized the issuance of a Right with respect to each
share of Common Stock outstanding on July 10, 2001. The Rights will initially
trade with, and will be inseparable from, the Common Stock. New Rights will
accompany any new shares of Common Stock we issue after July 10, 2001, until the
Distribution Date described below.
EXERCISE PRICE. Each Right will allow its holder to purchase from our Company
one one-hundredth of a share of Series AA Junior Participating Preferred Stock
("Preferred Stock") for $49.00, once the Rights become exercisable. This portion
of a share of Preferred Stock will give the shareholder approximately the same
dividend, voting, and liquidation rights as would one share of Common Stock.
Prior to exercise, the Right does not give its holder any dividend, voting, or
liquidation rights.
EXERCISABILITY. The Rights will not be exercisable until:
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o 10 days after the public announcement that a person or group has become
an "Acquiring Person" by obtaining beneficial ownership of 15% or more
of our outstanding Common Stock, or, if earlier,
o 10 business days (or a later date determined by our Board before any
person or group becomes an Acquiring Person) after a person or group
begins a tender or exchange offer which, if completed, would result in
that person or group becoming an Acquiring Person.
We refer to the date when the Rights become exercisable as the
"Distribution Date." Until that date, the Common Stock certificates will also
evidence the Rights, and any transfer of shares of Common Stock will constitute
a transfer of Rights. After that date, the Rights will separate from the Common
Stock and be evidenced by book-entry credits or by Rights certificates that we
will mail to all eligible holders of Common Stock. Any Rights held by an
Acquiring Person are void and may not be exercised.
CONSEQUENCES OF A PERSON OR GROUP BECOMING AN ACQUIRING PERSON.
o FLIP IN. If a person or group becomes an Acquiring Person, all holders
of Rights except the Acquiring Person may, for $100.00, purchase shares
of our Common Stock with a market value of $200.00, based on the market
price of the Common Stock prior to such acquisition.
o FLIP OVER. If our Company is later acquired in a merger or similar
transaction after the Rights Distribution Date, all holders of Rights
except the Acquiring Person may, for $100.00, purchase shares of the
acquiring corporation with a market value of $200.00, based on the
market price of the acquiring corporation's stock, prior to such
merger.
PREFERRED STOCK PROVISIONS.
Each whole share of Preferred Stock, if issued:
o will not be redeemable.
o will entitle holders to quarterly dividend payments of $1 per share, or
an amount equal to 100 times the dividend paid on one share of Common
Stock, whichever is greater.
o will entitle holders upon liquidation either to receive $100 per share
or an amount equal to 100 times the payment made on one share of Common
Stock, whichever is greater.
o will have the same voting power as 100 shares of Common Stock and will
vote as a single class with the Common Stock.
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o if shares of our Common Stock are exchanged via merger, consolidation,
or a similar transaction, will entitle holders to a per share payment
equal to the payment made on one hundred shares of Common Stock.
The value of one one-hundredth interest in a share of Preferred Stock
should approximate the value of one share of Common Stock.
EXPIRATION. The Rights will expire on July 10, 2011.
REDEMPTION. Our Board may redeem the Rights for $0.01 per Right at any time
before any person or group becomes an Acquiring Person. If our Board redeems any
Rights, it must redeem all of the Rights. Once the Rights are redeemed, the only
right of the holders of Rights will be to receive the redemption price of $0.01
per Right. The redemption price will be adjusted if we have a stock split or
stock dividends of our Common Stock.
EXCHANGE. After a person or group becomes an Acquiring Person, but before an
Acquiring Person owns 50% or more of our outstanding Common Stock, our Board may
extinguish the Rights by exchanging one share of Common Stock or an equivalent
security for each Right, other than Rights held by the Acquiring Person.
ANTI-DILUTION PROVISIONS. Our Board may adjust the purchase price of the
Preferred Stock, the number of shares of Preferred Stock issuable and the number
of outstanding Rights to prevent dilution that may occur from a stock dividend,
a stock split, a reclassification of the Preferred Stock or Common Stock.
Adjustments to the purchase price of less than 1% will be deferred until the
earlier of three years after the transaction requiring the adjustment or the
date the right to exercise the Rights expires.
AMENDMENTS. The terms of the Rights Agreement may be amended by our Board
without the consent of the holders of the Rights. After a person or group
becomes an Acquiring Person, our Board may not amend the Rights Agreement in any
way that adversely affects the holders of the Rights.
C-3