Exhibit 4
Rights Agreement, dated as of January 10, 1997,
between BFC Financial Corporation
and
▇▇▇▇▇ ▇▇▇▇▇▇ Shareholder Services, L.L.C.,
as Rights Agent
RIGHTS AGREEMENT
Rights Agreement (the "Agreement"), dated as of January 10, 1997, by and between
BFC FINANCIAL CORPORATION, a Florida corporation (the "Company"), and ▇▇▇▇▇
▇▇▇▇▇▇ SHAREHOLDER SERVICES, L.L.C., as Rights Agent (the "Rights Agent").
W I T N E S S E T H:
WHEREAS, on January 10, 1997, the Board of Directors of the
Company authorized the issuance of, and declared a dividend payable in, one
right (a "Right") for each share of Common Stock, $0.01 par value per share, of
the Company outstanding as of the close of business on January 21, 1997 (the
"Record Date"), each such Right representing the right to purchase one
one-hundredth of a share of Series A Junior Participating Preferred Stock of the
Company ("Series A Preferred Stock"), upon the terms and subject to the
conditions hereinafter set forth; and
WHEREAS, the Board of Directors of the Company presently
intends to authorize the issuance of one Right with respect to each share of
Common Stock which may be issued between the Record Date and the earlier to
occur of the Expiration Date or the Final Expiration Date (as such terms are
hereinafter defined);
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereby agree as follows:
Section 1.Certain Definitions. For purposes of this Agreement,
the following terms shall have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as
such term is hereinafter defined) who or which, together
with all Affiliates (as such term is hereinafter defined)
and Associates (as such term is hereinafter defined) of
such Person, shall be the Beneficial Owner (as such term is
hereinafter defined) of 20% or more of the shares of Voting
Stock (as such term is hereinafter defined) then
outstanding; provided, however, that an Acquiring Person
shall not include an Exempt Person (as such term is
hereinafter defined), or any Person, together with all
Affiliates and Associates of such Person, who or which
would be an Acquiring Person by reason of (i) being the
Beneficial Owner of shares of Voting Stock, the Beneficial
Ownership of which was acquired by such Person (or his or
its predecessor) pursuant to a transaction or series of
related transactions approved by the Continuing Directors
(as such term is hereinafter defined) of the Company and
effected before such Person (or his or its predecessor)
otherwise became an Acquiring Person, (ii) a reduction in
the number of issued and outstanding shares of Voting Stock
of the Company pursuant to a transaction or a series of
related transactions approved by the Continuing Directors
of the Company, (iii) any action or transaction deemed by a
resolution of the Continuing Directors of the Company not
to cause such Person to become an Acquiring Person which
resolution is passed prior to such Person (or his or its
predecessor) otherwise becoming an Acquiring Person, or
(iv) being the Beneficial Owner on the date of this
Agreement of 20% or more of outstanding Voting Stock;
provided, further, however, that (A) in the event such
Person does not become an Acquiring Person by reason of
clause (i), (ii) or (iii) of this Section 1(a), such Person
shall become an Acquiring Person in the event such Person
thereafter acquires Beneficial Ownership of an additional
1% of the Voting Stock unless such Person would not become
an Acquiring Person by reason of any provision of this
Agreement, including clause (i), (ii) or (iii); and (B) in
the event such Person does not become an Acquiring Person
by reason of clause (iv) of this Section 1(a), such Person
shall become an Acquiring Person in the event such Person
at any time after the date of this Agreement acquires
Beneficial Ownership of an additional 1% of the Voting
Stock.
(b) "Affiliate" shall have the meaning ascribed
to such term in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934, as
amended ("Exchange Act"), as in effect on the date of this
Rights Agreement.
(c) "Associate" of a Person (as such term is
hereinafter defined) shall mean (i) with respect to a
corporation, any officer or director thereof or of any
Subsidiary (as such term is hereinafter defined) thereof,
or any Beneficial Owner (as such term is hereinafter
defined) of 10% or more of any class of equity security
thereof, (ii) with respect to an association, any officer
or director thereof or of a Subsidiary thereof, (iii) with
respect to a partnership, any general partner thereof or
any limited partner thereof who is, directly or indirectly,
the Beneficial Owner of a 10% ownership interest therein,
(iv) with respect to a business trust, any officer or
trustee thereof or of any Subsidiary thereof, (v) with
respect to any other trust or an estate, any trustee,
executor or similar fiduciary or any Person who has a 20%
or greater interest as a beneficiary in the income from or
principal of such trust or estate, (vi) with respect to a
natural person, any relative or spouse of such person, or
any relative of such spouse, who has the same home as such
person, and (vii) any Affiliate of such Person.
(d) A person shall be deemed the "Beneficial
Owner" of, or to "Beneficially Own", any securities:
(i) which such Person or any of such
Person's Affiliates or Associates beneficially
owns, directly or indirectly, for purposes of
Section 13(d) of the Exchange Act and Rules 13d-1
through 13d-7 thereunder (or any comparable or
successor law or regulation), in each case as in
effect on the date hereof; or
(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 or the fulfillment of a condition or
both) pursuant to any agreement, arrangement or
understanding, or upon the exercise of conversion
rights, exchange rights, other rights (other than
these Rights), warrants or options, or otherwise;
provided, however, that a Person shall not be
deemed the "Beneficial Owner" of, or to
"Beneficially Own", securities tendered pursuant
to a tender or exchange offer made by such Person
or any of such Person's Affiliates or Associates
until such tendered securities are accepted for
purchase or exchange or (B) the right to vote,
alone or in concert with others, pursuant to any
agreement, arrangement or understanding (whether
or not in writing); provided, however, that a
Person shall not be deemed the "Beneficial Owner"
of, or to "Beneficially Own", any securities if
the agreement, arrangement or understanding to
vote such security (1) arises solely from a
revocable proxy or consent given in response to a
proxy or consent solicitation made pursuant to,
and in accordance with, the applicable rules and
regulations under the Exchange Act and (2) is not
at the time reportable by such Person on a
Schedule 13D or Schedule 13G report under the
Exchange Act (or any comparable or successor
report), other than by reference to a proxy or
consent solicitation being conducted by such
Person; 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 (whether or not in
writing) for the purpose of acquiring, holding,
voting (except as described in clause B of
subparagraph (ii) of this paragraph (d)) or
disposing of any securities of the Company;
provided, however, that for purposes of
determining beneficial ownership of securities
under this Rights Agreement, officers and
directors of the Company shall not constitute a
group (notwithstanding that they may be
Associates of one another or may be deemed to
constitute a group for purposes of the Exchange
Act) and shall not be deemed to own shares owned
by another officer or director of the Company by
virtue of any actions such officers or directors
take as such.
(e) "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in
the State of Florida 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., Miami, Florida time, on such date; provided,
however, that if such date is not a Business Day it shall
mean 5:00 P.M., Miami, Florida time, on the next succeeding
Business Day.
(g) "Common Stock" shall mean the Common Stock,
$0.01 par value, of the Company. "Common Stock" when used
with reference to the Principal Party (as such term is
hereinafter defined) shall mean the capital stock or other
equity security with the greatest voting power of the
Principal Party and, when used with reference to any Person
other than the Company or the Principal Party, shall mean
the capital stock or other equity security with the greatest
voting power of such Person or, if such Person is a
Subsidiary of or is controlled by another Person, the Person
which ultimately controls such first-mentioned Person.
(h) "Continuing Director" shall mean any member
of the Board of Directors, while such person is a member of
the Board of Directors, who is not an Acquiring Person, or
an Affiliate or Associate of an Acquiring Person, or
representative or nominee of an Acquiring Person or of any
such Affiliate or Associate, and who either (i) was a
member of the Board of Directors prior to the Stock
Acquisition Date, or (ii) subsequently became a member of
the Board of Directors, and whose nomination for election
or election to the Board of Directors was recommended or
approved by a majority of the Continuing Directors then on
the Board of Directors.
(i) "Distribution Date" shall have the meaning set
forth in Section 3(b) hereof.
(j) "Exchange Act" shall have the meaning set
forth in Section 1(b) hereof.
(k) "Exempt Person" shall mean the (i) Company,
(ii) any Subsidiary of the Company, (iii) any employee
benefit plan or employee stock plan of the Company or of
any Subsidiary of the Company or any trust or other entity
organized, appointed, established or holding Common Stock
for or pursuant to the terms of any such plan, or (iv) any
Existing Control Person.
(l) "Exercise Price" shall have the meaning set
forth in Sections 4 and 7(b) hereof.
(m) "Existing Control Person" shall mean (i) ▇▇▇▇
▇. ▇▇▇▇▇ or ▇▇▇▇ ▇. ▇▇▇▇ or any of their respective
Affiliates or Associates or the spouse, children, siblings,
or assigns of either ▇▇▇▇ ▇. ▇▇▇▇▇ or ▇▇▇▇ ▇. ▇▇▇▇ (if not
otherwise deemed to be Affiliates or Associates of such
persons hereunder) or (ii) I.R.E. Properties, Inc., I.R.E.
Advisors, Inc., I.R.E. Realty Advisors Group, Inc. or
Florida Partners Corporation or any of their respective
Affiliates, Associates or assigns.
(n) "Expiration Date" shall have the meaning set
forth in Section 7(a) hereof.
(o) "Fair Market Value" of any property shall
mean the fair market value of such property as determined
in accordance with Section 11(b) hereof.
(p) "Final Expiration Date" shall have the meaning
set forth in Section 7(a) hereof.
(q) "Person" shall mean any individual, firm,
corporation or other entity.
(r) "Principal Party" shall have the meaning set
forth in Section 13(b) hereof.
(s) "Redemption Price" shall have the meaning set
forth in Section 23(a) hereof.
(t) "Right Certificate" shall have the meaning set
forth in Section 3(d) hereof.
(u) "Stock Acquisition Date" shall mean the first
date by which both (i) an Acquiring Person has become such
and (ii) a public announcement of such fact has been made
by either the Company or such Acquiring Person (which, for
purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 13(d) or
Section 13(g) of the Exchange Act).
(v) "Subsidiary" of a Person shall mean any
corporation or other entity of which securities or other
ownership interests having voting power sufficient to elect
a majority of the board of directors or other persons
performing similar functions are beneficially owned,
directly or indirectly, by such Person or by any
corporation or other entity that is otherwise controlled by
such Person.
(w) "Summary of Rights" shall have the meaning set
forth in Section 3(a) hereof.
(x) "Trading Day" shall have the meaning set forth
in Section 11(b) hereof.
(y) "Transfer Tax" shall mean any tax or charge,
including any documentary stamp tax, imposed or collected
by any governmental or regulatory authority in respect of
any transfer of any security, instrument or right,
including Rights, shares of Common Stock and shares of
Series A Preferred Stock.
(z) "Voting Stock" shall mean (i) the Common
Stock of the Company and (ii) any other shares of capital
stock of the Company entitled to vote generally in the
election of directors or entitled to vote together with the
Common Stock in respect of any merger, consolidation, sale
of all or substantially all of the Company's assets,
liquidation, dissolution or winding up.
Any determination required to be made by the Board of Directors of the Company
for purposes of applying the definitions contained in this Section 1 shall be
made by the Board of Directors in its good faith judgment, which determination
shall be binding on the Rights Agent and the holders of the Rights.
Section 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company and the holders of the
Rights in accordance with the terms and conditions hereof, and the Rights Agent
hereby accepts such appointment. The Company may from time to time appoint such
co-Rights Agents as it may deem necessary or desirable.
Section 3. Issuance of Right Certificates.
(a) On the Record Date (or as soon as practicable
thereafter), the Company shall send a copy of a Summary of
Rights, in substantially the form attached hereto as Exhibit
B (the "Summary of Rights"), by first class mail, postage
prepaid, 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.
(b) Until the close of business on the tenth day
(or such later date as may be determined by action of the
Board of Directors) after the earlier to occur of (i) the
Stock Acquisition Date or (ii) the date of the commencement
by any Person (other than an Exempt Person) of, or the first
public announcement of the intent of any Person (other than
an Exempt Person) to commence, a tender or exchange offer
upon the successful consummation of which such Person,
together with its Affiliates and Associates, would be the
Beneficial Owner of 20% or more of the then outstanding
shares of Voting Stock of the Company (irrespective of
whether any shares are actually purchased pursuant to any
such offer) (including any such date which is after the date
of this Agreement and prior to the issuance of the Rights;
the earlier of such dates being herein referred to as the
"Distribution Date"), (x) the Rights shall be evidenced
(subject to the provisions of Section 3(a)) by the
certificates for Common Stock registered in the name of the
holders of the Common Stock (which certificates for Common
Stock shall also constitute certificates for Rights) and not
by separate Right Certificates and the record holders of
such certificates for Common Stock shall be the record
holders of the Rights represented thereby and (y) each Right
shall be transferable only simultaneously and together with
the transfer of a share of Common Stock. Until the
Distribution Date (or, if earlier, the Expiration Date or
Final Expiration Date), the surrender for transfer of any
certificate for Common Stock shall constitute the surrender
for transfer of the Right or Rights associated with the
Common Stock evidenced thereby, whether or not a copy of the
Summary of Rights is transferred simultaneously with such
share certificate.
(c) Certificates for Common Stock issued after the Record Date
but prior to the earliest of the Distribution Date, the Expiration Date, or the
Final Expiration Date shall have impressed, printed, written or stamped thereon
or otherwise affixed thereto the following legend:
This certificate also evidences and
entitles the holder hereof to the same number of
Rights as the number of shares of Common Stock
represented by this certificate, such Rights being
on the terms provided under the Rights Agreement
between BFC Financial Corporation and ▇▇▇▇▇ ▇▇▇▇▇▇
Shareholder Services, L.L.C. (the "Rights Agent"),
dated as of January 10, 1997 (the "Rights
Agreement"), the terms of which are incorporated
herein by reference and a copy of which is on file
at the principal executive offices of BFC
Financial Corporation. Under certain
circumstances, as set forth in the Rights
Agreement, such Rights shall be evidenced by
separate certificates and shall no longer be
evidenced by this certificate. BFC Financial
Corporation shall mail to the registered holder of
this certificate a copy of the Rights Agreement
without charge within five days after receipt of a
written request therefor. Under certain
circumstances as provided in the Rights Agreement,
Rights issued to or owned by Acquiring Persons or
their Affiliates or Associates (as defined in the
Rights Agreement) and any subsequent holder of
such Rights shall be null and void.
(d) As soon as practicable after the Distribution Date, the
Company or the Rights Agent shall send, by first class mail, postage prepaid, to
each record holder of the Common Stock as of the close of business on the
Distribution Date, as shown by the records of the Company, at the address of
such holder shown on such records, a certificate in the form provided by Section
4 hereof (a "Right Certificate"), evidencing one Right for each share of Common
Stock so held. As of and after the Distribution Date, the Rights shall be
evidenced solely by Right Certificates and may be transferred by the transfer of
the Right Certificate as permitted hereby, separately and apart from any
transfer of one or more shares of Common Stock.
Section 4. Form of Right Certificates.
(a) The Right Certificates (and the forms of election to
purchase shares, certificate and assignment to be printed on the reverse
thereof), when, as and if issued, shall be substantially in the form set forth
on Exhibit C hereto and may have such marks of identification or designation and
such legends, summaries or endorsements printed thereon as may be required to
comply with any law or with any rule or regulation made pursuant thereto or with
any rule or regulation of the National Association of Securities Dealers, Inc.
or any successor thereto or any stock exchange or other interdealer quotation
system on which the Common Stock or the Rights may from time to time be listed
or as the Company may deem appropriate to conform to usage or otherwise and as
are not inconsistent with the provisions of this Rights Agreement. Subject to
the provisions of Section 22 hereof, Right Certificates evidencing Rights
whenever issued, (i) shall be dated as of the date of issuance of the Rights
they represent and (ii) subject to adjustment from time to time as provided
herein, on their face shall entitle the holders thereof to purchase such number
of shares (including fractional shares which are integral multiples of
one-hundredth of a share) of Series A Preferred Stock as shall be set forth
therein at the price payable upon exercise of a Right provided by Section 7(b)
hereof as the same may from time to time be adjusted as provided herein (the
"Exercise Price").
(b) Notwithstanding any other provision of this Rights
Agreement, any Right Certificate that represents Rights beneficially owned by an
Acquiring Person or any Affiliate or Associate thereof shall have impressed on,
printed on, written on or otherwise affixed to it (if the Company or the Rights
Agent has knowledge that such Person is an Acquiring Person or an Associate or
Affiliate or a nominee of any of the foregoing) the following legend:
The Beneficial Owner of the Rights
represented by this Right Certificate is an
Acquiring Person or an Affiliate or an Associate
of an Acquiring Person. Accordingly, this Right
Certificate and the Rights represented hereby may
be or become void in the circumstances specified
in Section 7(e) of the Rights Agreement.
Nothing in this Section 4(b) creates any obligations on behalf of the
Rights Agent to investigate, or take any action in order to determine, if any
Right Certificate is beneficially owned by an Acquiring Person or any Affiliate
or Associate thereof.
Section 5. Countersignature and Registration.
(a) Each Right Certificate shall be executed on behalf of the
Company by its Chairman of the Board, President or any Vice President, either
manually or by facsimile signature, and have affixed thereto the Company's seal
or a facsimile thereof which shall be attested by the Secretary or an Assistant
Secretary of the Company, either manually or by facsimile signature. Each Right
Certificate shall be countersigned by the Rights Agent either manually or by
facsimile signature and shall not be valid for any purpose unless so
countersigned. In case any officer of the Company who shall have signed any
Right Certificate shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery of the
certificate by the Company, such Right Certificate, nevertheless, may be
countersigned by the Rights Agent and 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, on the date of the execution of such
Right Certificate, shall be a proper officer of the Company to sign such Right
Certificate, although at the date of the execution of this Rights Agreement any
such person was not such an officer.
(b) Following the Distribution Date, the Rights Agent will
keep or cause to be kept, at its principal office, and in such other locations
as may be required by law, books for registration and transfer of the Right
Certificates issued hereunder. Such books shall show the names and addresses of
the respective holders of the Right Certificates, the number of Rights evidenced
on its face by each of the Right Certificates and the date of each of the Right
Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of
Right Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
(a) Subject to the provisions of Section 14(b) hereof, at any
time after the close of business on the Distribution Date, and at or prior to
the close of business on the earlier of the Expiration Date or the Final
Expiration Date, any Right Certificate (other than Right Certificates
representing Rights that have become void pursuant to Sections 7(e) and
11(a)(ii) hereof), may be (i) transferred or (ii) split up, combined or
exchanged for one or more other Right Certificates, entitling the registered
holder to purchase a like number of shares of Series A Preferred Stock as the
Right Certificate or Right Certificates surrendered then entitled such holder to
purchase. Any registered holder desiring to transfer any Right Certificate shall
surrender the Right Certificate at the principal office of the Rights Agent with
the form of certificate and assignment on the reverse side thereof duly endorsed
(or enclosed with such Right Certificate a written instrument of transfer in
form satisfactory to the Company and the Rights Agent), duly executed by the
registered holder thereof or his attorney duly authorized in writing, and with
such signature duly guaranteed. Any registered holder desiring to 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 to be
split up, combined or exchanged at the principal office of the Rights Agent.
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
Transfer Tax that may be imposed in connection with any transfer, split up,
combination or exchange of any Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft, destruction or
mutilation of a Right Certificate, and, in case of loss, theft or destruction,
of indemnity or security reasonably satisfactory to them and, if requested by
the Company, reimbursement to the Company and the Rights Agent of all reasonable
expenses incidental thereto, or upon surrender to the Rights Agent and
cancellation of the Right Certificate if mutilated, the Company shall issue and
deliver a new Right Certificate of like tenor to the Rights Agent for delivery
to the registered owner in lieu of the Right Certificate so lost, stolen,
destroyed or mutilated.
Section 7. Exercise of Rights; Exercise Price; Expiration Date
of Rights.
(a) The Rights shall not be exercisable until, and shall
become exercisable on, the Distribution Date (unless otherwise provided herein,
including, without limitation, the restrictions on exercisability set forth in
Section 23(a) hereof). The Rights may be exercised, in whole or in part, at any
time commencing with the Distribution Date upon surrender of the Right
Certificate, with the form of election to purchase and certificate on the
reverse side thereof duly executed (with signatures duly guaranteed), to the
Rights Agent at the designated office of the Rights Agent, together with payment
of the Exercise Price with respect to each Right exercised, subject to
adjustment as hereinafter provided, at or prior to the close of business on the
earlier of (i) January 10, 2007 (the "Final Expiration Date") or (ii) the date
on which the Rights are redeemed as provided in Section 23 hereof (such earlier
date being herein referred to as the "Expiration Date").
(b) The Exercise Price of $40 shall initially be for each one
one-hundredth (1/100) of a share of Series A Preferred Stock issued pursuant to
the exercise of a Right. The Exercise Price and the number of shares of Series A
Preferred Stock or other securities to be acquired upon exercise of a Right
shall be subject to adjustment from time to time as provided in Sections 11 and
13 hereof. The Exercise Price 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 certificate
and form of election to purchase duly executed, accompanied by payment by check
or money order payable to the order of the Company or the Rights Agent of the
Exercise Price or so much thereof as is necessary for the purchase of shares or
other securities to be purchased upon exercise of the Rights and an amount equal
to any applicable Transfer Tax, the Rights Agent shall thereupon promptly (i)
requisition from any transfer agent of the Series A Preferred Stock of the
Company one or more certificates representing the number of shares of Series A
Preferred Stock to be so purchased, and the Company hereby authorizes and
directs such transfer agent to comply with all such requests, (ii) as provided
in Section 14(b), at the election of the Company, cause depository receipts to
be issued in lieu of fractional shares of Series A Preferred Stock, (iii) when
appropriate, requisition from the Company the amount of cash to be paid in lieu
of the issuance of fractional shares in accordance with Section 14(b) hereof and
(iv) after receipt of such Series A Preferred Stock certificates and/or
depository receipts or cash payments, cause the same to be delivered to or upon
the order of the registered holder of such Right Certificate, registered in such
name or names as may be designated by such holder, and, when appropriate, after
receipt, promptly deliver such cash to or upon the order of the registered
holder of such Right Certificate; provided, however, that in the case of a
purchase of securities, other than Series A Preferred Stock, pursuant to Section
13 hereof, the Rights Agent shall promptly take the appropriate actions
corresponding in such case to that referred to in the foregoing clauses (i)
through (iv) of this Section 7(c). Notwithstanding the foregoing provisions of
this Section 7(c), the Company may suspend the issuance of shares of Series A
Preferred Stock or Common Stock or other securities upon exercise of a Right for
a reasonable period, not in excess of 90 days, during which the Company seeks to
register under the Securities Act of 1933, as amended, and any applicable
securities law of any other jurisdiction, the shares of Series A Preferred Stock
or Common Stock or other securities to be issued pursuant to the Rights;
provided, however, that nothing contained in this Section 7(c) shall relieve the
Company of its obligations under Section 9(c) hereof.
(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 his assign, subject to the provisions of Section 14(b) hereof.
(e) Notwithstanding any provision of this Rights Agreement to
the contrary, upon the occurrence of the event described in Section 11(a)(ii)
hereof, any Rights that are at the time of the occurrence of such event
Beneficially Owned by (i) an Acquiring Person or by any Associate or Affiliate
of such Acquiring Person, (ii) a transferee of an Acquiring Person (or of any
such Associate or Affiliate) who becomes a transferee after the Acquiring Person
becomes such, or (iii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee prior to or concurrently with
the Acquiring Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the Acquiring Person to
holders of equity interests in such Acquiring Person or to any Person with whom
the Acquiring Person has any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer which the Board of Directors
of the Company has determined is part of a plan, arrangement or understanding
that has as a primary purpose or effect the avoidance of this Section 7(e),
shall in each case become null and void without any further action and no holder
of such Rights shall have any rights whatsoever with respect to such Rights,
whether under any provision of this Agreement or otherwise, nor may any Person
subsequently become a holder of such Rights. The Company shall use all
reasonable efforts to insure that the provisions of this Section 7(e) and
Section 4(b) hereof are complied with, but shall have no liability to any holder
of Right Certificates or other Person as a result of its making or failing to
make any determinations with respect to an Acquiring Person or its Affiliates,
Associates or transferees hereunder.
(f) The Company shall not effect any amendment to its Articles
of Incorporation in a manner which would adversely affect the preferences,
limitations and relative rights of the Series A Preferred Stock, without the
prior approval of the holders of (i) the then outstanding Rights and (ii) the
then outstanding shares of Series A Preferred Stock. Such approval shall be by a
majority vote, with the holders of Rights and the holders of the Series A
Preferred Stock voting together as a single voting group; provided, however,
that the holder of each share of Series A Preferred Stock shall have one vote
and the holder of each Right shall have one one-hundredth of a vote with respect
to each such amendment.
(g) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be obligated to
undertake any action with respect to a registered holder upon the occurrence of
any purported exercise as set forth in this Section 7 unless such registered
holder shall have (i) completed and signed the certificate following the form of
election to purchase set forth on the reverse side of the Right Certificate
surrendered for such exercise and (ii) provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) or Affiliates or
Associates thereof as the Company shall reasonably request.
Section 8. Cancellation and Destruction of Right Certificates.
All Right Certificates surrendered for the purpose of exercise, transfer, split
up, combination or exchange shall, if surrendered to the Company or 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
cancel and retire, any 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.
Section 9. Reservation and Availability of Shares of Series A
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
A Preferred Stock (and, following the Stock Acquisition Date, out of its
authorized and unissued shares of Common Stock and/or other securities) such
number of shares of Series A Preferred Stock (and, following the Stock
Acquisition Date, Common Stock and/or other securities) as will from time to
time be sufficient to permit the exercise in full of all outstanding Rights. The
Company shall take such action as may be required for it to comply with the
foregoing sentence of this Section 9(a).
(b) So long as the shares of Series A Preferred Stock (or
shares of Common Stock and/or other securities, as the case may be) issuable and
deliverable upon the exercise of the Rights may be listed on any national
securities exchange or quotation system, the Company shall use its best efforts
to cause, from and after such time as the Rights become exercisable, all shares
reserved for such issuance to be listed on such exchange or quotation system
upon official notice of issuance upon such exercise.
(c) The Company covenants and agrees that it will take all
such action as may be necessary to insure that all shares of Series A Preferred
Stock (and, following the Stock Acquisition Date, shares of Common Stock and/or
other securities) delivered upon exercise of Rights shall, at the time of
delivery of the certificates for such shares (subject to payment of the Exercise
Price in respect thereof), be duly and validly authorized and issued and fully
paid and non-assessable shares.
(d) The Company further covenants and agrees that it will pay
when due and payable any and all federal and state Transfer Taxes which may be
payable in respect of the issuance or delivery of the Right Certificates or of
any shares of Series A Preferred Stock (or shares of Common Stock and/or other
securities, as the case may be) issued or delivered upon the exercise of Rights.
The Company shall not, however, be required to pay any Transfer Tax which may be
payable in respect of any transfer or delivery of a Right Certificate to a
Person other than, or the issuance or delivery of certificates for Series A
Preferred Stock (or shares of Common Stock and/or other securities, as the case
may be) upon exercise of Rights in a name other than that of, the registered
holder of the Right Certificate, and the Company shall not be required to issue
or deliver a Right Certificate or certificate for Series A Preferred Stock (or
Common Stock and/or other securities, as the case may be) to a Person other than
such registered holder until any such Transfer Tax shall have been paid (any
such Transfer Tax being payable by the holder of such Right Certificate at the
time of surrender) or until it has been established to the Company's
satisfaction that no such Transfer Tax is due.
Section 10. Series A Preferred Stock Record Date. Each Person
in whose name any certificate for shares of Series A Preferred Stock (or Common
Stock and/or other securities, as the case may be) is issued upon the exercise
of Rights shall for all purposes be deemed to have become the holder of record
of the Series A Preferred Stock (or Common Stock and/or other securities, as the
case may be) represented thereby on, and such certificate shall be dated as of,
the date upon which the Right Certificate evidencing such Rights was duly
surrendered and payment of the Exercise Price (and any applicable Transfer
Taxes) was made; provided, however, that, if the date of such surrender and
payment is a date upon which the 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 as of, the next succeeding Business Day on which
the transfer books of the Company are open. Prior to the exercise of the Rights
evidenced thereby, the holder of a Right Certificate, as such, shall not be
entitled to any rights of a shareholder of the Company with respect to shares
for which the Rights shall be exercisable, including, without limitation, the
right to vote, to receive dividends or other distributions or to exercise any
preemptive rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
Section 11. Adjustment of Exercise Price or Number of Shares.
The Exercise Price, the number and kind of shares which may be purchased upon
exercise of a Right and the number of Rights outstanding are subject to
adjustment from time to time as provided in this Section 11.
(a) (i) In the event the Company shall at any time after the
date of this Rights Agreement (A) declare or pay any dividend on
Series A Preferred Stock payable in shares of Series A Preferred
Stock, (B) subdivide or split the outstanding shares of Series A
Preferred Stock into a greater number of shares, (C) combine or
consolidate the outstanding shares of Series A Preferred Stock into a
smaller number of shares or effect a reverse split of the outstanding
shares of Series A Preferred Stock, or (D) issue any shares of its
capital stock in a reclassification of the Series A Preferred Stock,
then in each such case, except as otherwise provided in this Section
11(a) and Section 7(e), the Exercise Price in effect at the time of
the record date for such dividend or of the effective date of such
subdivision, combination or reclassification, and the number and kind
of shares of Series A Preferred Stock or capital stock, as the case
may be, issuable upon exercise of a Right on such date, shall be
proportionately adjusted so that the holder of any Right exercised
after such time shall be entitled to receive, upon payment of the
Exercise Price then in effect, the aggregate number and kind of shares
of Series A Preferred Stock or capital stock, as the case may be,
which, if such Right had been exercised immediately prior to such date
and at a time when the 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. If an event occurs which would require an adjustment
under both this Section 11(a)(i) and Section 11(a)(ii) hereof, the
adjustment provided for in this Section 11(a)(i) shall be in addition
to, and shall be made prior to, any adjustment required pursuant to
Section 11(a)(ii).
(ii) In the event that any Person (other than an Exempt
Person), alone or together with its Affiliates and Associates, shall
become an Acquiring Person, except pursuant to a transaction approved
in advance by a majority of the Continuing Directors provided the
Continuing Directors constitute a majority of the Board of Directors
(the "Trigger Event"), then, within ten days after the occurrence of
the Trigger Event, proper provision shall be made so that each holder
of a Right, except as provided in Section 7(e) hereof, shall
thereafter have a right to receive for each Right, upon exercise
thereof in accordance with the terms of this Rights Agreement at the
then current Exercise Price, in lieu of Series A Preferred Stock, such
number of shares of Common Stock of the Company as shall equal the
result obtained by (x) multiplying the then current Exercise Price by
the then number of one one-hundredths of a share of Series A Preferred
Stock for which a Right was or would have been exercisable immediately
prior to such event and (y) dividing that product by 50% of the
current Fair Market Value per share of the Common Stock (determined
pursuant to Section 11(b) hereof) on the date of the occurrence of
such event; provided, however, that if the transaction that would
otherwise give rise to the foregoing adjustment is also subject to the
provisions of Section 13 hereof, then only the provisions of Section
13 hereof shall apply and no adjustment shall be made pursuant to this
Section 11(a)(ii).
(iii) In the event that the Company does not have available
sufficient authorized but unissued Series A Preferred Stock or Common
Stock, as the case may be, to permit the adjustments required pursuant
to the foregoing subparagraph (i) or the exercise in full of the
Rights in accordance with the foregoing subparagraph (ii), the Company
shall take all such action as may be necessary to authorize and
reserve for issuance such number of additional shares of Series A
Preferred Stock or Common Stock, as the case may be, as may from time
to time be required to be issued upon the exercise in full of all
Rights from time to time outstanding and, if necessary, shall use its
best efforts to obtain shareholder approval thereof. In lieu of
issuing shares of Common Stock in accordance with the foregoing
subparagraph (ii), the Company may, if a majority of the Continuing
Directors determines that such action is necessary or appropriate and
not contrary to the interests of holders of Rights, elect to issue or
pay, upon the exercise of the Rights, cash, property, shares of Series
A Preferred or Common Stock, or any combination thereof, having an
aggregate Fair Market Value equal to the Fair Market Value of the
shares of Common Stock which otherwise would have been issuable
pursuant to Section 11(a)(ii), which Fair Market Value shall be
determined by a majority of the Continuing Directors or an investment
banking firm selected by such majority. Subject to Section 23 hereof,
any such election by a majority of the Continuing Directors of the
Company must be made and publicly announced within thirty (30) days
after the date on which the event described in Section 11(a)(ii)
occurs.
(b) For the purpose of this Rights Agreement, the "Fair Market
Value" of any share of Series A Preferred Stock, Common Stock or any other stock
or any Right or other security or any other property on any date shall be
determined as provided in this Section 11(b). In the case of a publicly-traded
stock or other security, the Fair Market Value on any date shall be deemed to be
the average of the daily closing prices per share of such stock or per unit of
such other security for the 30 consecutive Trading Days (as such term is
hereinafter defined) immediately prior to such date; provided, however, that in
the event that the Fair Market Value per share of any security is determined
during a period which includes any date that is within 30 Trading Days after (i)
the ex-dividend date for a dividend or distribution on such security payable in
shares of such security or securities convertible into such shares, or (ii) the
effective date of any subdivision, split, combination, consolidation, reverse
stock split or reclassification of such security, then, and in each such case,
the Fair Market Value shall be appropriately adjusted by the Board of Directors
of the Company to take into account ex-dividend or post-effective date trading.
The closing price for any day shall be the last sale price, regular way, or, in
case no such sale takes place on such day, the average of the closing bid and
asked prices, regular way (in either case, as reported in the applicable
transaction reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange), or, if the securities are not listed or
admitted to trading on the New York Stock Exchange, as reported in the
applicable transaction reporting system with respect to securities listed on the
principal national securities exchange on which such security is listed or
admitted to trading; or, if not listed or admitted to trading on any national
securities exchange, the last quoted price (or, if not so quoted, the average of
the high bid and low asked prices) in the over-the-counter market, as reported
by The Nasdaq Stock Market, Inc. or such other system then in use; or, if no
bids for such security are quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market maker making
a market in such security selected by the Board of Directors of the Company. The
term "Trading Day" shall mean a day on which the principal national securities
exchange on which such security is listed or admitted to trading is open for the
transaction of business or, if such security is not listed or admitted to
trading on any national securities exchange, a Business Day. If a security is
not publicly held or not so listed or traded, "Fair Market Value" shall mean the
fair value per share of stock or per other unit of such other security, as
determined by an independent investment banking firm experienced in the
valuation of securities selected in good faith by the Board of Directors of the
Company, or, if no such investment banking firm is, in the good faith judgment
of the Board of Directors, reasonably available to make such determination, in
good faith by the Board of Directors of the Company; provided, however, that for
purposes of making the adjustment provided for by Section 11(a)(ii) hereof, the
Fair Market Value of a share of Series A Preferred Stock shall not be less than
100% of the product of the Fair Market Value of a share of Common Stock
multiplied by the higher of the then "Dividend Multiple" or "Vote Multiple"
applicable to the Series A Preferred Stock (as such terms are defined in the
Company's Articles of Incorporation) and shall not exceed 105% of the product of
the then Fair Market Value of a share of Common Stock multiplied by the higher
of the then Dividend Multiple or Vote Multiple applicable to the Series A
Preferred Stock. In the case of property other than securities, the "Fair Market
Value" thereof shall be determined in good faith by the Board of Directors of
the Company based upon such appraisals or valuation reports of such independent
experts as the Board of Directors of the Company shall in good faith determine
to be appropriate in accordance with good business practices and the interests
of the holders of Rights. Any such determination of Fair Market Value shall be
described in a statement filed with the Rights Agent and shall be binding upon
the Rights Agent.
(c) 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
one one-millionth of a share of Series A Preferred Stock, as the case may be.
(d) Irrespective of any adjustment or change in the Exercise
Price or the number of one one-hundredth of a share of Series A Preferred Stock
issuable upon the exercise of the Rights, the Right Certificates theretofore and
thereafter issued may continue to express the Exercise Price and the number of
one one-hundredth of a share to be issued upon exercise of the Rights as in the
initial Right Certificates issued hereunder but, nevertheless, shall represent
the Rights as so adjusted.
(e) Before taking any action that would cause an adjustment
reducing the Exercise Price below one one-hundredth of the then par value, if
any, of the shares of Series A Preferred Stock, the Company shall use its best
efforts to take any corporate action which may, in the opinion of its counsel,
be necessary in order that the Company may validly and legally issue fully paid
and non-assessable shares of such Series A Preferred Stock at such adjusted
Exercise Price per share.
(f) Anything in this Section 11 to the contrary
notwithstanding, in the event of any reclassification of stock of the Company or
any recapitalization, reorganization or partial liquidation of the Company or
similar transaction, the Company shall be entitled to make such further
adjustments in the number of shares of Series A Preferred Stock or Common Stock
which may be acquired upon exercise of the Rights, and such adjustments in the
Exercise Price therefor, in addition to those adjustments expressly required by
the other paragraphs of this Section 11, as the Board of Directors of the
Company shall determine to be necessary or appropriate in order for the holders
of the Rights in such event to be treated equitably and in accordance with the
purpose and intent of this Rights Agreement or in order that any such event
shall not, but for such adjustment, in the opinion of counsel to the Company,
result in the shareholders of the Company being subject to any United States
federal income tax liability by reason thereof.
(g) In case the Company at any time after the Record Date
shall fix a record date for the making of a distribution to all holders of
Series A 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 or assets (other than a
regular periodic cash dividend at a rate not in excess of 150% of the rate of
the last periodic cash dividend theretofore paid or a dividend payable in Series
A Preferred Stock) or subscription rights or warrants, the Exercise Price to be
in effect after such record date shall be determined by multiplying the Exercise
Price in effect immediately prior to such record date by a fraction, the
numerator of which shall be the current Fair Market Value per share of Series A
Preferred Stock (as defined in Section 11(b) hereof) on such record date, less
the Fair Market Value (as determined in good faith by the Board of Directors of
the Company, whose determination shall be described in a statement filed with
the Rights Agent) of the portion of the assets or evidences of indebtedness so
to be distributed or of such subscription rights or warrants applicable to one
share of Series A Preferred Stock and of which the denominator shall be such
current Fair Market Value per share of Series A 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 Exercise Price shall
again be adjusted to be the Exercise Price which would then be in effect if such
record date had not been fixed.
(h) In case the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of Series A Preferred
Stock entitling them (for a period expiring within 45 calendar days after such
record date) to subscribe for or purchase Series A Preferred Stock (or shares
having substantially the same rights, privileges, and preferences as the Series
A Preferred Stock ("Equivalent Preferred Shares")) or securities convertible
into Series A Preferred Stock or Equivalent Preferred Shares at a price per
share of Series A Preferred Stock or Equivalent Preferred Share (or having a
conversion price per share, if a security convertible into Series A Preferred
Stock or Equivalent Preferred Shares) less than the current Fair Market Value
per share of Series A Preferred Stock (as defined in Section 11(b) hereof) on
such record date, the Exercise Price to be in effect after such record date
shall be determined by multiplying the Exercise Price in effect immediately
prior to such record date by a fraction, of which the numerator shall be the
number of shares of Series A Preferred Stock and Equivalent Preferred Shares
outstanding on such record date plus the number of shares of Series A Preferred
Stock which the aggregate offering price of the total number of shares of Series
A Preferred Stock and/or Equivalent Preferred Shares to be so offered (and/or
the aggregate initial conversion price of the convertible securities to be so
offered) would purchase at such current Fair Market Value and of which the
denominator shall be the number of shares of Series A Preferred Stock and
Equivalent Preferred Shares outstanding on such record date plus the number of
additional shares of Series A Preferred Stock and/or Equivalent Preferred Shares
to be offered for subscription or purchase (or into which the convertible
securities so to be offered are initially convertible). 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 the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent.
Series A Preferred Stock owned by or held for the account of the Company or any
of its Subsidiaries shall not be deemed outstanding for the purpose of any such
computation. Such adjustment shall be made successively whenever such a record
date is fixed; and in the event that such rights, options or warrants are not so
issued, the Exercise Price shall be adjusted to be the Exercise Price which
would then be in effect if such record date had not been fixed.
(i) Notwithstanding anything herein to the contrary, no
adjustment in the Exercise Price shall be required unless such adjustment would
require an increase or decrease of at least 1% in such price; provided, however,
that any adjustments which by reason of this Section 11(i) are not required to
be made shall be carried forward and taken into account in any subsequent
adjustment.
(j) In the event that at any time, as a result of an
adjustment made pursuant to Section 11(a) or Section 13(a), the holder of any
Right thereafter exercised shall become entitled to receive any securities other
than Series A Preferred Stock, thereafter the number or amount of such other
securities 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 securities contained in
Section 11, and the provisions of Sections 7, 9, 10, 13 and 14 of this Agreement
with respect to the Series A Preferred Stock shall apply on like terms to any
such other securities.
(k) All Rights originally issued by the Company subsequent to
any adjustment made to the Exercise Price hereunder shall evidence the right to
purchase, at the adjusted Exercise Price, the number of one one-hundredths of a
share of Series A Preferred Stock purchasable from time to time hereunder upon
exercise of the Rights, all subject to further adjustment as provided herein.
(l) Upon each adjustment of the Exercise Price as a result of
the calculations made in Section 11(g) and (h) of this Agreement, each Right
outstanding immediately prior to the making of such adjustment shall thereafter
evidence the right to purchase, at the adjusted Exercise Price, that number of
one one-hundredths of a share of Series A Preferred Stock (calculated to the
nearest one one-millionth of a share of Series A Preferred Stock) obtained by
(i) multiplying (x) the number of one one-hundredths of a share of Series A
Preferred Stock covered by a Right immediately prior to such adjustment by (y)
the Exercise Price in effect immediately prior to such adjustment of the
Exercise Price and (ii) dividing the product so obtained by the Exercise price
in effect immediately after such adjustment of the Exercise Price.
Section 12. Certification of Adjusted Exercise Price or Number
of Shares. Whenever an adjustment is made as provided in Section 11, 13 or
23(c), the Company shall (a) promptly prepare a certificate setting forth such
adjustment, and a brief statement of the facts giving rise to such adjustment,
(b) promptly file with the Rights Agent and with each transfer agent for the
Series A Preferred Stock a copy of such certificate and (c) mail a brief summary
thereof to each holder of a Right Certificate in accordance with Section 25.
Notwithstanding the foregoing sentence, the failure of the Company to make such
certification or give such notice shall not affect the validity of or the force
or effect of the requirement for such adjustment. Any adjustment to be made
pursuant to Section 11, 13 or 23(c) of this Rights Agreement shall be effective
as of the date of the event giving rise to such adjustment. The Rights Agent
shall be fully protected in relying on any such certificate and on any
adjustment therein contained and shall not be deemed to have knowledge of any
adjustment unless and until it shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer of
Assets or Earning Power.
(a) Except pursuant to a transaction approved in advance by a
majority of the Continuing Directors, in the event that, at any time on or after
the Distribution Date, (x) the Company shall, directly or indirectly,
consolidate with, or merge with and into, any other Person or Persons (other
than an Exempt Person) and the Company shall not be the surviving or continuing
corporation of such consolidation or merger, or (y) any Person or Persons (other
than an Exempt Person) shall, directly or indirectly, consolidate with, or merge
with and into, the Company, and the Company shall be the continuing or surviving
corporation of such consolidation or merger and, in connection with such
consolidation or merger, all or part of the outstanding shares of Common Stock
shall be changed into or exchanged for stock or other securities of any other
Person (other than an Exempt Person) or of the Company or cash or any other
property, or (z) the Company or one or more of its Subsidiaries shall, directly
or indirectly, sell or otherwise transfer to any other Person or any Affiliate
or Associate of such Person, in one or more transactions, or the Company or one
or more of its Subsidiaries shall sell or otherwise transfer to any Persons in
one or a series of related transactions, assets or earning power aggregating
more than 50% of the assets or earning power of the Company and its Subsidiaries
(taken as a whole), then, on the first occurrence of any such event, proper
provision shall be made so that (i) each holder of record of a Right shall
thereafter have the right to receive, upon the exercise thereof in accordance
with the terms of this Rights Agreement at the then current Exercise Price, in
lieu of Series A Preferred Stock, Common Stock and other securities or assets of
the Company, such number of validly authorized and issued, fully paid,
non-assessable and freely tradable shares of Common Stock of the Principal Party
(as hereinafter defined), not subject to any liens, encumbrances, rights of
first refusal or other adverse claims, as shall be equal to the result obtained
by (A) multiplying the then current Exercise Price by the number of one
one-hundredths of a share of Series A Preferred Stock for which a Right was
exercisable immediately prior to the date of consummation of such consolidation,
merger, sale or transfer (without taking into account any adjustment previously
made pursuant to Section 11(a)(ii)) and (y) dividing that product by 50% of the
current Fair Market Value per share of the Common Stock of such Principal Party
(determined pursuant to Section 11(b) hereof) on the date of consummation of
such consolidation, merger, sale or transfer; (ii) such Principal Party shall
thereafter be liable for, and shall assume, by virtue of such consolidation,
merger, sale or transfer, all the obligations and duties of the Company pursuant
to this Rights Agreement; (iii) the term "Company" for all purposes of this
Rights Agreement shall thereafter be deemed to refer to such Principal Party;
and (iv) such Principal Party shall take such steps (including, but not limited
to, the reservation of a sufficient number of shares of its Common Stock in
accordance with the provisions of Section 9 hereof applicable to the reservation
of Common Stock) in connection with such consummation as may be necessary to
assure that the provisions hereof shall thereafter be applicable, as nearly as
reasonably may be, in relation to its shares of Common Stock thereafter
deliverable upon the exercise of the Rights; provided, however, that, upon the
subsequent occurrence of any merger, consolidation, sale of all or substantially
all of the assets, recapitalization, reclassification of shares, reorganization
or other extraordinary transaction in respect of such Principal Party, each
holder of a Right shall thereupon be entitled to receive, upon exercise of a
Right and payment of the Exercise Price, such cash, shares, rights, warrants and
other property which such holder would have been entitled to receive had it, at
the time of such transaction, owned the shares of Common Stock of the Principal
Party purchasable upon the exercise of a Right, and such Principal Party shall
take such steps (including, but not limited to, reservation of shares of stock)
as may be necessary to permit the subsequent exercise of the Rights in
accordance with the terms hereof for such cash, shares, rights, warrants and
other property.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in (x) or (y)
of the first sentence of Section 13(a) hereof: (A) the Person that is
the issuer of the securities into which shares of Common Stock of the
Company are converted in such merger or consolidation, or, if there is
more than one such issuer, the issuer of the Common Stock of which has
the greatest market value or (B) if no securities are so issued, (x)
the Person that is the other party to the merger or consolidation and
that survives such merger or consolidation, or, if there is more than
one such Person, the Person the Common Stock of which has the greatest
market value or (y) if the Person that is the other party to the
merger or consolidation does not survive the merger or consolidation,
the Person that does survive the merger or consolidation (including
the Company if it survives); and
(ii) in the case of any transaction described in (z) of the
first sentence in Section 13(a), the Person that is the party
receiving the greatest portion of the assets or earning power
transferred pursuant to such transaction or transactions, or, if each
Person that is a party to such transaction or transactions receives
the same portion of the assets or earning power so transferred or if
the Person receiving the greatest portion of the assets or earning
power cannot be determined, whichever of such Persons as is the issuer
of Common Stock having the greatest market value of shares
outstanding; provided, however, that in any such case, if the Common
Stock of such Person is not at such time and has not been continuously
over the preceding 12-month period registered under Section 12 of the
Exchange Act, and such Person is a direct or indirect Subsidiary of
another Person the Common Stock of which is and has been so
registered, the term "Principal Party" shall refer to such other
Person, or if such Person is a Subsidiary, directly or indirectly, of
more than one Person, the Common Stocks of all of which are and have
been so registered, the term "Principal Party" shall refer to
whichever of such Persons is the issuer of the Common Stock having the
greatest market value of shares outstanding.
(c) The Company shall not consummate any consolidation, merger
or sale or transfer of assets or earning power referred to in Section 13(a)
unless prior thereto the Company and the Principal Party involved therein shall
have executed and delivered to the Rights Agent an agreement confirming that the
Principal Party shall, upon consummation of such consolidation, merger or sale
or transfer of assets or earning power, assume this Rights Agreement in
accordance with Sections 13(a) and (b) hereof and that all rights of first
refusal or preemptive rights in respect of the issuance of shares of Common
Stock of the Principal Party upon exercise of outstanding Rights have been
waived and that such transaction shall not result in a default by the Principal
Party under this Rights Agreement, and further providing that, as soon as
practicable after the date of any consolidation, merger or sale or transfer of
assets or earning power referred to in Section 13(a) hereof, the Principal Party
will:
(i) prepare and file a registration statement under the
Securities Act of 1933, as amended (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 date of expiration
of the Rights, and similarly comply with applicable state securities
laws;
(ii) use its best efforts to list (or continue the listing
of) the Rights and the securities purchasable upon exercise of the
Rights on a national securities exchange or to meet the eligibility
requirements for quotation on the NASDAQ National Market; and
(iii) deliver to holders of the Rights historical financial
statements for the Principal Party which comply in all respects with
the requirements for registration on Form 10 (or any successor form)
under the Exchange Act.
In the event that any of the transactions described in Section 13(a) hereof
shall occur at any time after the occurrence of a transaction described in
Section 11(a)(ii) hereof, the Rights which have not theretofore been exercised
shall, subject to the provisions of Section 7(e) hereof, thereafter be
exercisable in the manner described in Section 13(a) (without taking into
account any prior adjustment required by Section 11(a)(ii)).
Section 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
(i.e., Rights to acquire less than one one-hundredth of a share of Series A
Preferred Stock). If the Company shall determine not to issue such fractional
Rights, then, in lieu of such fractional Rights, there shall be paid to the
holders of record of the Right Certificates with regard to which such fractional
Rights would otherwise be issuable, an amount in cash equal to the same fraction
of the Fair Market Value of a whole Right.
(b) The Company shall not be required to issue fractions of
shares of Series A Preferred Stock (other than fractions which are integral
multiples of one-hundredth of a share) upon exercise of the Rights or to
distribute certificates which evidence fractional shares (other than fractions
which are integral multiples of one-hundredth of a share). In lieu of issuing
fractions of shares of Series A Preferred Stock, the Company may, at its
election, issue depositary receipts evidencing fractions of shares 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 of the rights, privileges and preferences to which they
would be entitled as owners of the Series A Preferred Stock. With respect to
fractional shares that are not integral multiples of one-hundredth of a share,
if the Company does not issue such fractional shares or depositary receipts in
lieu thereof, there shall be paid to the holders of record of Right Certificates
at the time such Right Certificates are exercised as herein provided an amount
in cash equal to the same fraction of the Fair Market Value of a share of Series
A Preferred Stock.
(c) Following the occurrence of the Stock Acquisition Date,
the Company shall not be required to issue fractions of shares of Common Stock
upon exercise of the Rights or to distribute certificates which evidence
fractional shares of Common Stock. In lieu of fractional shares of Common Stock,
the Company may pay to the registered holders of Right Certificates at the time
such Rights are exercised as herein provided an amount in cash equal to the same
fraction of the Fair Market Value of one share of Common Stock.
(d) The holder of a Right by the acceptance of a Right
expressly waives his right to receive any fractional Right or any fractional
shares (other than fractions which are integral multiples of one-hundredth of a
share) upon exercise of a Right.
Section 15. Rights of Action. All rights of action in respect
of this Rights Agreement, except the rights of action given to the Rights Agent
in Section 18 hereof, are vested in the respective registered holders of the
Right Certificates (and, prior to the Distribution Date, the holders of record
of the Common Stock); and any holder of record 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, on his own behalf and for his own
benefit, enforce, and may institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect of, his right to
exercise the Rights evidenced by such 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 a Principal Party and of any Person
subject to this Rights Agreement.
Section 16. Agreement of Right Holders. Each 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 shall be
evidenced (subject to the provisions of Section 3(b) hereof) by the certificates
for Common Stock registered in the name of the holders of the Common Stock
(which certificates for Common Stock shall also constitute certificates for
Rights) and not by separate Right Certificates, and each Right shall be
transferable only simultaneously and together with the transfer of shares 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 principal office of the Rights Agent, 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 Certificates or the associated Common Stock
certificate made by anyone other than the Company or the Rights Agent) for all
purposes whatsoever, and neither the Company nor the Rights Agent shall be
affected by any notice to the contrary.
Section 17. Right Certificate Holder Not Deemed a Shareholder.
No holder, as such, of any Right Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of Series A Preferred Stock or
any other securities which may at any time be issuable on the exercise of the
Rights represented thereby, nor shall anything contained herein or in any Right
Certificate be construed to confer upon the holder of any Right Certificate, as
such, any of the rights of a shareholder of the Company or any right to vote for
the election of directors or upon any matter submitted to shareholders at any
meeting thereof (except as provided in Section 7(f) hereof), or to give or
withhold consent to any corporate action (except as provided in Section 7(f)
hereof), or to receive notice of meetings or other actions affecting
shareholders (except as provided in Section 24 hereof), or to receive dividends
or subscription rights, or otherwise, until the Right or Rights evidenced by
such Right Certificate shall have been exercised in accordance with the
provisions hereof.
Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent 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 administration and execution 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, or expense, incurred without negligence, bad faith or
willful misconduct on the part of the Rights Agent, for anything done or omitted
to be done by the Rights Agent in connection with the acceptance and
administration of this Rights Agreement, including the cost and expenses of
defending against any claim of liability relating to the Rights or this Rights
Agreement.
(b) The Rights Agent shall be protected against, and shall
incur no liability for or in respect of, any action taken, suffered or omitted
by it in connection with its administration of this Rights Agreement in reliance
upon any Right Certificate or certificate for Series A Preferred 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.
(c) The Rights Agent shall only be responsible to act in
accordance with those express duties and obligations set forth herein.
(d) The Rights Agent shall not be required to expend its own
funds hereunder.
Section 19. Merger or Consolidation of, or Change in Name of,
the Rights Agent.
(a) Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be consolidated, or
any corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the corporate trust or stock transfer business of the Rights Agent
or any successor Rights Agent, shall be the successor to the Rights Agent under
this 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
corporation would be eligible for appointment as a successor Rights Agent under
the provisions of Section 21 hereof. In case at the time such successor Rights
Agent shall succeed to the agency created by this 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
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; 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; in all such cases such Right Certificates shall have the
full force provided in the Right Certificates and in this Rights Agreement.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes only those express duties and obligations set forth in this Rights
Agreement, subject to 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), and the opinion of such counsel shall be full
and complete authorization and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this
Rights Agreement the Rights Agent shall deem it necessary or desirable that any
fact or matter be proved or established by the Company prior to taking or
suffering any action hereunder, such fact or matter (unless other evidence in
respect thereof is specifically prescribed herein) may be deemed to be
conclusively proved and established by a certificate signed by the Chairman of
the Board, the President or any Vice President and by the Treasurer or the
Secretary of the Company and delivered to the Rights Agent. Any such certificate
shall be full authorization to the Rights Agent for any action taken or suffered
in good faith by it under the provisions of this Rights Agreement in reliance
upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its
own negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of
any of the statements of fact or recitals contained in this 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 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 Section 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 receipt of a certificate describing any
such adjustment); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any shares
of Series A Preferred Stock or Common Stock or other securities to be issued
pursuant to this Rights Agreement or any Right Certificate or as to whether any
shares of Series A Preferred Stock or Common 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 the Rights Agreement.
(g) The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties hereunder from
the Chairman of the Board, the President or any Vice President or the Secretary
or the Treasurer of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable for any
action taken or suffered to be taken by it in good faith in accordance with
instructions of any such officer.
(h) The Rights Agent and any shareholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though it were not the Rights
Agent under this Rights Agreement. Nothing herein shall preclude the Rights
Agent from acting in any other capacity for the Company or for any other legal
entity.
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder either itself
or by or through its attorneys or agents, and the Rights Agent shall not be
answerable or accountable for any act, default, neglect or misconduct of any
such attorneys or agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct, provided reasonable care was exercised in
the selection and continued employment thereof.
Section 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' prior notice in writing mailed to the Company and
to each transfer agent of the Common Stock and the Series A Preferred Stock by
registered or certified mail. The Company may remove the Rights Agent or any
successor Rights Agent (with or without cause) upon 30 days' prior 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 the Series A Preferred
Stock by registered or certified mail. If the Rights Agent shall resign or be
removed or shall otherwise become incapable of acting, the Company shall appoint
a successor to the Rights Agent. Notwithstanding the foregoing provisions of
this Section 21, in no event shall the resignation or removal of a Rights Agent
be effective until a successor Rights Agent shall have been appointed and have
accepted such appointment. 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 (who shall, with such
notice, submit his Right Certificate for inspection by the Company), then the
incumbent Rights Agent or the holder of record of any Right Certificate may
apply to any court of competent jurisdiction for the appointment of a new Rights
Agent. Any successor Rights Agent, whether appointed by the Company or by such a
court, shall be (a) a corporation organized and doing business under the laws of
the United States or of any state thereof, in good standing, which is authorized
under such laws to exercise corporate trust or stock transfer powers and is
subject to supervision or examination in the conduct of its corporate trust or
stock transfer business by federal or state authorities and which has at the
time of its appointment as Rights Agent a combined capital and surplus of at
least $5,000,000 or (b) an Affiliate controlled by a corporation described in
clause (a) of this sentence. After appointment, the successor Rights Agent shall
be vested with the same powers, rights, duties and responsibilities as if it had
been originally named as Rights Agent without further act or deed, but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder, and 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 A Preferred Stock, and mail a notice thereof in
writing by mail to the registered holders of the Right Certificates. Failure to
give any notice provided for in this Section 21, however, or any defect therein,
shall not affect the legality or validity of the resignation or removal of the
Rights Agent or the appointment of the successor Rights Agent, as the case may
be. Notwithstanding the foregoing provisions, in the event of resignation,
removal or incapacity of the Rights Agent, the Company shall have the authority
to act as the Rights Agent until a successor Rights Agent shall have assumed the
duties of the Rights Agent hereunder.
Section 22. Issuance of New Right Certificates.
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 its Board of Directors to
reflect any adjustment or change in the Exercise Price per share and the number
or kind or class of shares of stock or other securities or property purchasable
under the Right Certificates made in accordance with the provisions of this
Rights Agreement.
Section 23. Redemption.
(a) The Board of Directors of the Company may, at its option,
redeem all but not less than all the then outstanding Rights, at any time prior
to the close of business on the earlier of (i) the tenth day following the Stock
Acquisition Date (or such later date as a majority of the Continuing Directors
in office may determine) or (ii) the Final Expiration Date, at a redemption
price of $.01 per Right, subject to adjustments as provided in subsection (c)
below (the "Redemption Price"). Notwithstanding anything contained in this
Agreement to the contrary, the Rights shall not be exercisable pursuant to
Section 11(a)(ii) prior to the expiration of the Company's right of redemption
hereunder.
(b) Immediately upon the action of the Board of Directors of
the Company ordering the redemption of the Rights, and without any further
action and without any notice, the right to exercise the Rights will terminate
and the only right thereafter of the holders of Rights shall be to receive the
Redemption Price. 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 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 notice of redemption will state the method by which
the payment of the Redemption Price will be made.
(c) In the event the Company shall at any time after the date
of this Rights Agreement (A) pay any dividend on Common Stock in shares of
Common Stock, (B) subdivide or split the outstanding shares of Common Stock into
a greater number of shares or (C) combine or consolidate the outstanding shares
of Common Stock into a smaller number of shares or effect a reverse split of the
outstanding shares of Common Stock, then and in each such event the Redemption
Price shall be adjusted so that the Redemption Price after such event shall
equal the Redemption Price immediately prior to such event multiplied by a
fraction the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is the
number of shares of Common Stock outstanding immediately prior to such event;
provided, however, that in each case such adjustment to the Redemption Price
shall be made only if the amount of the Redemption Price shall be reduced or
increased by $.01 per Right.
Section 24. Notice of Proposed Actions.
(a) In case the Company, after the Distribution Date, shall
propose (i) to effect any of the transactions referred to in Section 11(a)(i) or
to pay any dividend to the holders of record of its Series A Preferred Stock
payable in stock of any class or to make any other distribution to the holders
of record of its Series A Preferred Stock (other than a regular periodic cash
dividend at a rate not in excess of 150% of the rate of the last cash dividend
theretofore paid), or (ii) to offer to the holders of record of its Series A
Preferred Stock options, warrants, or other rights to subscribe for or to
purchase shares of Series A Preferred Stock (including any security convertible
into or exchangeable for Series A Preferred Stock) or shares of stock of any
class or any other securities, options, warrants, convertible or exchangeable
securities or other rights, or (iii) to effect any reclassification of its
Series A Preferred Stock or any recapitalization or reorganization of the
Company, or (iv) to effect any consolidation or merger with or into, or to
effect any sale or other transfer (or to permit one or more of its Subsidiaries
to effect any sale or other transfer), in one or more transactions, of more than
50% of the assets or earning power of the Company and its Subsidiaries (taken as
a whole) to, any other Person or Persons, or (v) to effect the liquidation,
dissolution or winding up of the Company, then, in each such case, the Company
shall give to each holder of record of a Right Certificate, in accordance with
Section 25, notice of such proposed action, which shall specify the record date
for the purposes of such transaction referred to in Section 11(a)(i) or such
dividend or distribution, or the date on which such reclassification,
recapitalization, reorganization, consolidation, merger, sale or transfer of
assets, liquidation, dissolution, or winding up is to take place and the record
date for determining participation therein by the holders of record of Common
Stock or Series A Preferred Stock, if any such date is to be fixed, and such
notice shall be so given in the case of any action covered by clause (i) or (ii)
above at least 10 days prior to the record date for determining holders of
record of the Series A Preferred Stock for purposes of such action, and in the
case of any such other action, at least 10 days prior to the date of the taking
of such proposed action or the date or participation therein by the holders of
record of Common Stock or Series A Preferred Stock, whichever shall be the
earlier. The failure to give notice required by this Section 24 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 any of the transactions referred to in either
Section 11(a)(i) or Section 13 of this Rights Agreement are proposed, then, in
any such case, the Company shall give to each holder of Rights, in accordance
with Section 25 hereof, notice of the proposal of such transaction at least 10
days prior to consummating such transaction, which notice shall specify the
proposed event and the consequences of the event to holders of Rights under
Section 11(a)(i) or Section 13 hereof, as the case may be, and, upon
consummating such transaction, shall similarly give notice thereof to each
holder of Rights.
Section 25. Notices. Notices or demands authorized by this
Rights Agreement to be given or made by the Rights Agent or by the holder of
record of any Right Certificate or Right 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:
BFC Financial Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chairman of the Board
Subject to the provisions of Section 21, any notice or demand authorized by this
Rights Agreement to be given or made by the Company or by the holder of record
of any Right Certificate or Right 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:
▇▇▇▇▇ ▇▇▇▇▇▇ Shareholder Services, L.L.C.
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Notices or demands authorized by this Rights Agreement to be given or made by
the Company or the Rights Agent to the holder of record of any Right Certificate
or Right shall be sufficiently given or made if sent by first-class mail,
postage prepaid, addressed to such holder at the address of such holder as shown
on the registry books of the Company.
Section 26. Supplements and Amendments. The Company and the
Rights Agent, if the Company so directs, may from time to time supplement or
amend this Rights Agreement without the approval of any holders of Right
Certificates (i) in order to cure any ambiguity, (ii) to correct or supplement
any provision contained herein which may be defective or inconsistent with any
other provisions herein, (iii) prior to the Distribution Date, to otherwise
amend or supplement in any respect any provision herein which the Company may
deem necessary or desirable, or (iv) subsequent to the Distribution Date, to
amend or supplement in any respect any provision herein which the Company may
deem necessary or desirable and which shall not adversely affect the interest of
the holders of Rights (other than an Acquiring Person or any Affiliate or
Associate of an Acquiring Person), provided, however, that this Agreement may be
amended or supplemented following the Distribution Date only with the approval
of a majority of the Continuing Directors and only if the Continuing Directors
constitute a majority of the number of directors then in office. This Agreement
may be amended or supplemented at any time with the approval of a majority of
the registered holders of the Right Certificates (and, prior to the Distribution
Date, the Common Stock).
Section 27. Successors. All of 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.
Section 28. Benefits of this Rights Agreement. Nothing in this
Rights Agreement shall be construed to give to any person or corporation other
than the Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the Common Stock) 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 holders of record of the Right Certificates (and, prior to the
Distribution Date, the Common Stock).
Section 29. Florida Contract. This Rights Agreement and each
Right Certificate issued hereunder shall be deemed to be a contract made under
the laws of the State of Florida and for all purposes shall be governed by and
construed and enforced in accordance with the laws of such state applicable to
contracts to be made and performed entirely within such state.
Section 30. 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.
Section 31. 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.
Section 32. 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.
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.
BFC FINANCIAL CORPORATION
/S/ ▇▇▇▇ ▇. ▇▇▇▇▇
By: -------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
▇▇▇▇▇ ▇▇▇▇▇▇ SHAREHOLDER SERVICES, L.L.C.
/S/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
By: -------------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President
BFC FINANCIAL CORPORATION
and
▇▇▇▇▇ ▇▇▇▇▇▇ SHAREHOLDER SERVICES, L.L.C.
as Rights Agent
RIGHTS AGREEMENT
Dated as of January 10, 1997
Table of Contents
Section Page
1. Certain Definitions.....................................................
2. Appointment of Rights Agent.............................................
3. Issuance of Right Certificates..........................................
4. Form of Right Certificates..............................................
5. Countersignature and Registration.......................................
6. Transfer, Split Up, Combination and Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen Right Certificates .........
7. Exercise of Rights; Exercise Price; Expiration Date of Rights...........
8. Cancellation and Destruction of Right Certificates......................
9. Reservation and Availability of Shares of Series A Preferred Stock......
10. Series A Preferred Stock Record Date....................................
11. Adjustment of Exercise Price or Number of Shares........................
12. Certification of Adjusted Exercise Price or Number of Shares............
13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power....
14. Fractional Rights and Fractional Shares.................................
15. Rights of Action........................................................
16. Agreement of Right Holders..............................................
17. Right Certificate Holder Not Deemed a Shareholder.......................
18. Concerning the Rights Agent.............................................
19. Merger or Consolidation of, or Change in Name of, the Rights Agent......
20. Duties of Rights Agent..................................................
21. Change of Rights Agent..................................................
22. Issuance of New Right Certificates......................................
23. Redemption..............................................................
24. Notice of Proposed Actions..............................................
25. Notices.................................................................
26. Supplements and Amendments..............................................
27. Successors..............................................................
28. Benefits of this Rights Agreement.......................................
29. Florida Contract........................................................
30. Counterparts............................................................
31. Descriptive Headings....................................................
32. Severability............................................................
Exhibit A
ARTICLES OF AMENDMENT
OF
BFC FINANCIAL CORPORATION
The undersigned, being the Chairman of the Board of Directors of BFC Financial
Corporation, a Florida corporation (the "Corporation"), does hereby file these
Articles of Amendment to the Corporation's Articles of Incorporation, pursuant
to Sections 607.1006 and 607.0602 of the Florida Business Corporation Act.
1. The name of the Corporation is BFC Financial Corporation.
2. Article V of the Corporation's Articles of Incorporation shall be amended by
adding a new Section 5 thereto, after the existing provisions of such Article to
read as follows:
"Section 5. SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
(1) Designation and Amount. The shares of such series shall be
designated as "Series A Junior Participating Preferred Stock" (the
"Series A Preferred Stock") and the number of shares constituting such
series shall be 100,000.
(2) Dividends and Distributions.
(A) Subject to the provisions for adjustment hereinafter set
forth, the holders of shares of Series A Preferred Stock shall be
entitled to receive, when, as and if declared by the Board of Directors
out of funds legally available for the purpose, (i) cash dividends in
an amount per share (rounded to the nearest cent) equal to 100 times
the aggregate per share amount of all cash dividends declared or paid
on the Common Stock of the Corporation and (ii) a preferential cash
dividend (the "Series A Preferential Cash Dividends"), if any, on the
first day of February, May, August and November of each year (each 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 A Preferred Stock, in an amount equal to $.75 per
share of Series A Preferred Stock less the per share amount of all cash
dividends declared on the Series A Preferred Stock pursuant to clause
(i) of this sentence 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 A Preferred Stock. In the event the Corporation shall, at any
time after the issuance of any share or fraction of a share of Series A
Preferred Stock, make any distribution on the shares of Common Stock of
the Corporation, whether by way of a dividend or a reclassification of
stock, a recapitalization, reorganization or partial liquidation of the
Corporation or otherwise, which is payable in cash or any debt
security, debt instrument, real or personal property or any other
property (other than cash dividends subject to the immediately
preceding sentence, a distribution of shares of Common Stock or other
capital stock of the Corporation or a distribution of rights or
warrants to acquire any such share, including any debt security
convertible into or exchangeable for any such share, at a price less
than the Fair Market Value (as determined by the Board of Directors) of
such share), then and in each such event the Corporation shall
simultaneously pay on each then outstanding share of Series A Preferred
Stock of the Corporation a distribution, in like kind, of 100 times
such distribution paid on a share of Common Stock (subject to the
provisions for adjustment hereinafter set forth). The dividends and
distributions on the Series A Preferred Stock to which holders thereof
are entitled pursuant to clause (i) of the first sentence of this
paragraph and pursuant to the second sentence of this paragraph are
hereinafter referred to as "Participating Dividends" and the multiple
of such cash and non-cash dividends on the Common Stock applicable to
the determination of the Participating Dividends, which shall be 100
initially but shall be adjusted from time to time as hereinafter
provided, is hereinafter referred to as the "Dividend Multiple". In the
event the Corporation shall at any time after January 10, 1997 declare
or pay any dividend or make any distribution on Common Stock payable in
shares of Common Stock, or effect a subdivision or split or a
combination, consolidation or reverse split of the outstanding shares
of Common Stock into a greater or lesser number of shares of Common
Stock, then in each such case the Dividend Multiple thereafter
applicable to the determination of the amount of Participating
Dividends which holders of shares of Series A Preferred Stock shall be
entitled to receive shall be the Dividend Multiple applicable
immediately prior to such event multiplied by a fraction the numerator
of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number
of shares of Common Stock that were outstanding immediately prior to
such event.
(B) The Corporation shall declare each Participating Dividend
at the same time it declares any cash or non-cash dividend or
distribution on the Common Stock in respect of which a Participating
Dividend is required to be paid. No cash or non-cash dividend or
distribution on the Common Stock in respect of which a Participating
Dividend is required to be paid shall be paid or set aside for payment
on the Common Stock unless a Participating Dividend in respect of such
dividend or distribution on the Common Stock shall be simultaneously
paid, or set aside for payment, on the Series A Preferred Stock.
(C) Series A Preferential Cash Dividends shall begin to accrue
on outstanding shares of Series A Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issuance of any shares
of Series A Preferred Stock. Accrued but unpaid Series A Preferential
Cash Dividends shall be cumulative but shall not bear interest. Series
A Preferential Cash Dividends paid on the shares of Series A 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.
(3) Voting Rights. The holders of shares of Series A Preferred
Stock shall have the following voting rights:
(A) Subject to the provisions for adjustment hereinafter set
forth, each share of Series A Preferred Stock shall entitle the holder
thereof to 100 votes on all matters submitted to a vote of the
shareholders of the Corporation. The number of votes which a holder of
a share of Series A Preferred Stock is entitled to cast, as the same
may be adjusted from time to time as hereinafter provided, is
hereinafter referred to as the "Vote Multiple". In the event the
Corporation shall at any time after January 10, 1997 declare or pay any
dividend on Common Stock payable in shares of Common Stock, or effect a
subdivision or split or a combination, consolidation or reverse split
of the outstanding shares of Common Stock into a greater or lesser
number of shares of Common Stock, then in each such case the Vote
Multiple thereafter applicable to the determination of the number of
votes per share to which holders of shares of Series A Preferred Stock
shall be entitled after such event shall be the Vote Multiple
immediately prior to such event multiplied by a fraction the numerator
of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number
of shares of Common Stock that were outstanding immediately prior to
such event.
(B) Except as otherwise provided in these Articles of
Incorporation or in the Bylaws of the Corporation, the holders of
shares of Series A Preferred Stock and the holders of shares of Common
Stock shall vote together as a single voting group on all matters
submitted to a vote of shareholders of the Corporation.
(C) Unless otherwise provided in these Articles of
Incorporation, in the event that any preferential cash dividend to
which the holders of any currently existing or future series of the
Preferred Stock are entitled (collectively, the "Preferred Cash
Dividends") has accrued for four or more quarterly dividend periods,
whether consecutive or not, and shall not have been declared and paid
(or a sum sufficient for the payment thereof has been set aside) in
full, the holders of record of such series of Preferred Stock, other
than any series in respect of which such right is expressly withheld by
these Articles of Incorporation (such holders existing from time to
time being hereinafter referred to as the "Unpaid Series Holders"),
acting as a single voting group, shall have the right, at the next
meeting of shareholders called for the election of Directors, to elect
two members to the Board of Directors, which Directors (hereinafter,
the "Preferred Directors") shall be in addition to the number of
Directors required by the Bylaws of the Corporation prior to such
event, to serve until the next annual meeting of shareholders and until
their successors are elected and qualified or their earlier
resignation, removal or incapacity or until such earlier time as all
accrued and unpaid Preferred Cash Dividends shall have been paid (or a
sum sufficient for the payment thereof has been set aside) in full. If
at any annual meeting of shareholders at which the term of a Preferred
Director is fixed to expire there are accrued Preferred Cash Dividends
which have not been paid (or a sum sufficient for payment thereof has
not been set aside) in full, the Unpaid Series Holders shall have the
right to elect a Preferred Director to the vacant Directorship
resulting from the expiration of the term of such Preferred Director in
the manner provided in the immediately preceding sentence until all
accrued and unpaid Preferred Cash Dividends shall have been paid (or a
sum sufficient for payment thereof has been set aside) in full;
provided, however, that at no time shall more than two Preferred
Directors be members of the Board of Directors. The Preferred Directors
may be removed, with or without cause, by the Unpaid Series Holders.
Vacancies in such Directorships (whether caused by death, resignation,
removal or otherwise) may be filled (if any accrued Preferred Cash
Dividends remain unpaid or a sum sufficient for payment thereof has not
been set aside) only by the Unpaid Series Holders (or by the remaining
Director elected by the Unpaid Series Holders, if there be one) in the
manner permitted by law; provided, however, that any such action by the
Unpaid Series Holders shall be taken at a meeting of shareholders or
shall be taken by written consent; provided further, however, that by a
vote of a majority of the Board of Directors in office other than the
Preferred Directors, the Preferred Directors may be removed immediately
after all accrued and unpaid Preferred Cash Dividends shall have been
paid (or a sum sufficient for the payment thereof has been set aside)
in full.
(D) Except as otherwise provided in these Articles of
Incorporation or in the Bylaws of the Corporation, holders of Series A
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 the taking of any
corporate action.
(4) Certain Restrictions.
(A) Whenever Series A Preferential Cash Dividends or
Participating Dividends are in arrears or the Corporation shall be in
default of payment thereof, thereafter and until all accrued and unpaid
Series A Preferential Cash Dividends and Participating Dividends,
whether or not declared, on shares of Series A Preferred Stock
outstanding shall have been paid (or a sum sufficient for payment
thereof has been set aside) in full, and in addition to any and all
other rights which any holder of shares of Series A Preferred Stock may
have in such circumstances, the Corporation shall not
(i) declare or pay dividends on, make any other distributions
on, or redeem or purchase or otherwise acquire for
consideration, any shares of stock ranking junior (either as
to dividends or upon liquidation, dissolution or winding up)
to the Series A Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity as to
dividends with the Series A Preferred Stock, unless dividends
are paid ratably on the Series A 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 if the full dividends accrued
thereon were to be paid;
(iii) except as permitted by subparagraph (iv) of this
paragraph (4)(A), redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding
up) with the Series A Preferred Stock, provided that the
Corporation may at any time redeem, purchase or otherwise
acquire shares of any such parity stock in exchange for shares
of any stock of the Corporation ranking junior (both as to
dividends and upon liquidation, dissolution or winding up) to
the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of stock
ranking on a parity with the Series A Preferred Stock (either
as to dividends or upon liquidation, dissolution or winding
up), except in accordance with a purchase offer made 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 (as
hereinafter defined) 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. A
"Subsidiary" of the Corporation shall mean any corporation or other
entity of which securities or other ownership interests having ordinary
voting power sufficient to elect a majority of the Board of Directors
or other persons performing similar functions are beneficially owned,
directly or indirectly, by the Corporation or by any corporation or
other entity that is otherwise controlled by the Corporation.
(C) The Corporation shall not issue any shares of Series A
Preferred Stock except upon exercise of the Rights (the "Rights")
issued pursuant to that certain Rights Agreement dated as of January
10, 1997 between the Corporation and ▇▇▇▇▇ ▇▇▇▇▇▇ Shareholder Services,
L.L.C., as rights agent, a copy of which is on file with the Secretary
of the Corporation at its principal executive office and shall be made
available to shareholders of record without charge upon written request
therefor addressed to said Secretary. Notwithstanding the foregoing
sentence, nothing contained in the provisions hereof shall prohibit or
restrict the Corporation from issuing for any purpose any series of
Preferred Stock with rights and privileges similar to, different from,
or greater than, those of the Series A Preferred Stock.
(5) Reacquired Shares. Any shares of Series A Preferred Stock purchased
or otherwise acquired by the Corporation in any manner whatsoever shall
be retired and canceled promptly after the acquisition thereof. All
such shares upon their retirement and cancellation shall become
authorized but unissued shares of Preferred Stock, without designation
as to series, and such shares may be reissued as part of a new series
of Preferred Stock to be created by resolution or resolutions of the
Board of Directors.
(6) Liquidation, Dissolution or Winding Up. Upon any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation,
no distribution shall be made (A) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation, dissolution
or winding up) to the Series A Preferred Stock unless the holders of
shares of Series A Preferred Stock shall have received, subject to
adjustment as hereinafter provided, (i) $40 per one-hundredth share
plus an amount equal to accrued and unpaid dividends and distributions
thereon, whether or not declared, to the date of such payment, or (ii)
if greater than the amount specified in clause (A)(i) of this sentence,
an amount equal to 100 times the aggregate amount to be distributed per
share to holders of Common Stock, as the same may be adjusted as
hereinafter provided, and (B) to the holders of stock ranking on a
parity upon liquidation, dissolution or winding up with the Series A
Preferred Stock, unless simultaneously therewith distributions are made
ratably on the Series A Preferred Stock and all other shares of such
parity stock in proportion to the total amounts to which the holders of
shares of Series A Preferred Stock are entitled under clause (A)(i) of
this sentence and to which the holders of such parity shares are
entitled, in each case upon such liquidation, dissolution or winding
up. The amount to which holders of Series A Preferred Stock may be
entitled upon liquidation, dissolution or winding up of the Corporation
pursuant to clause (A) of the foregoing sentence is hereinafter
referred to as the "Participating Liquidation Amount" and the multiple
of the amount to be distributed to holders of shares of Common Stock
upon the liquidation, dissolution or winding up of the Corporation
applicable pursuant to said clause to the determination of the
Participating Liquidation Amount, as said multiple may be adjusted from
time to time as hereinafter provided, is hereinafter referred to as the
"Liquidation Multiple". In the event the Corporation shall at any time
after January 10, 1997 declare or pay any dividend on Common Stock
payable in shares of Common Stock, or effect a subdivision or split or
a combination, consolidation or reverse split of the outstanding shares
of Common Stock into a greater or lesser number of shares of Common
Stock, then in each such case the Liquidation Multiple thereafter
applicable to the determination of the Participating Liquidation Amount
to which holders of Series A Preferred Stock shall be entitled after
such event shall be the Liquidation Multiple applicable immediately
prior to such event multiplied by a fraction the numerator of which is
the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common
Stock that were outstanding immediately prior to such event.
(7) Certain Reclassifications. In the event that holders of shares of
Common Stock of the Corporation receive after January 10, 1997 in
respect of their shares of Common Stock any share of capital stock of
the Corporation (other than any share of Common Stock of the
Corporation), whether by way of reclassification, recapitalization,
reorganization, dividend or other distribution or otherwise (a
"Transaction"), then and in each such event the dividend rights, voting
rights and rights upon the liquidation, dissolution or winding up of
the Corporation of the shares of Series A Preferred Stock shall be
adjusted so that after such event the holders of Series A Preferred
Stock shall be entitled, in respect of each share of Series A Preferred
Stock held, in addition to such rights in respect thereof to which such
holder was entitled immediately prior to such adjustment, to (i) such
additional dividends as equal the Dividend Multiple in effect
immediately prior to such Transaction multiplied by the additional
dividends which the holder of a share of Common Stock shall be entitled
to receive by virtue of the receipt in the Transaction of such capital
stock, (ii) such additional voting rights as equal the Vote Multiple in
effect immediately prior to such Transaction multiplied by the
additional voting rights which the holder of a share of Common Stock
shall be entitled to receive by virtue of the receipt in the
Transaction of such capital stock and (iii) such additional
distributions upon liquidation, dissolution or winding up of the
Corporation as equal the Liquidation Multiple in effect immediately
prior to such Transaction multiplied by the additional amount which the
holder of a share of Common Stock shall be entitled to receive upon
liquidation, dissolution or winding up of the Corporation by virtue of
the receipt in the Transaction of such capital stock, as the case may
be, all as provided by the terms of such capital stock.
(8) Consolidation, Merger, etc. In case the Corporation shall enter
into any consolidation, merger, combination or other transaction in
which the shares of Common Stock are exchanged for or changed into
other stock or securities, cash and/or any other property, then in any
such case each outstanding share of Series A Preferred Stock shall at
the same time be similarly exchanged for or changed into the aggregate
amount of stock, securities, cash and/or other property (payable in
like kind), as the case may be, for which or into which each share of
Common Stock is changed or exchanged multiplied by the highest of the
Vote Multiple, the Dividend Multiple or the Liquidation Multiple in
effect immediately prior to such event.
(9) Effective Time of Adjustments.
(A) Adjustments to the Series A Preferred Stock required by
the provisions hereof shall be effective as of the time at which the
event requiring such adjustments occurs.
(B) The Corporation shall give prompt written notice to each
holder of a share of Series A Preferred Stock of the effect of any
adjustment to the voting rights, dividend rights or rights upon
liquidation, dissolution or winding up of the Corporation of such
shares required by the provisions hereof. Notwithstanding the foregoing
sentence, the failure of the Corporation to give such notice shall not
affect the validity of or the force or effect of or the requirement for
such adjustment.
(10) No Redemption. The shares of Series A Preferred Stock shall not be
redeemable at the option of the Corporation or any holder thereof.
Notwithstanding the foregoing sentence of this Section 10, the
Corporation may acquire shares of Series A Preferred Stock in any other
manner permitted by law and the Articles of Incorporation.
(11) Ranking. Unless otherwise provided in these Articles of
Incorporation, the Series A Preferred Stock shall rank junior to all
other series of the Corporation's Preferred Stock as to the payment of
dividends and the distribution of assets on liquidation, dissolution or
winding up and shall rank senior to the Common Stock.
(12) Amendment. These Articles of Incorporation of the Corporation
shall not be amended in any manner which would adversely affect the
rights, preferences or limitations of the Series A Preferred Stock
without, in addition to any other vote of shareholders required by law,
the approval of the holders of a majority of (1) the then outstanding
Rights (as defined in Section 5(4)(C) of this Article V) and (2) the
then outstanding shares of the Series A Preferred Stock, with the
holders of the Rights and the holders of the Series A Preferred Stock
voting together as a single voting group; provided, however, that the
holder of each share of Series A Preferred Stock shall have one vote
and the holder of each Right shall have one one-hundredth of a vote
with respect to each such amendment."
3. The foregoing amendment was adopted by the Board of Directors on January 10,
1997. A vote of shareholders of the Corporation was not needed for the adoption
of these Articles of Amendment.
IN WITNESS WHEREOF, the undersigned Chairman of the Board of Directors of the
Corporation has executed these Articles of Amendment on January 10, 1997.
BFC FINANCIAL CORPORATION
/S/ ▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇
Chairman of the Board of Directors
EXHIBIT B
BFC FINANCIAL CORPORATION
SUMMARY OF RIGHTS TO PURCHASE
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
On January 10, 1997, the Board of Directors of BFC FINANCIAL CORPORATION (the
"Company") declared a dividend distribution of one Right for each outstanding
share of common stock, par value $0.01 per share (the "Common Stock"), of the
Company. The distribution is payable as of January 21, 1997 to shareholders of
record on that date. Each Right entitles the registered holder to purchase from
the Company one one-hundredth (1/100th) of a share of preferred stock of the
Company, designated as Series A Junior Participating Preferred Stock (the
"Series A Preferred Stock") at a price of $40 per one one-hundredth (1/100th) of
a share of Series A Preferred Stock (the "Purchase Price"). The description and
terms of the Rights are set forth in a Rights Agreement, dated as of January 10,
1997 (the "Rights Agreement") between the Company and ▇▇▇▇▇ ▇▇▇▇▇▇ Shareholder
Services, L.L.C., as Rights Agent (the "Rights Agent").
AS DISCUSSED BELOW, INITIALLY THE RIGHTS WILL NOT BE EXERCISABLE, CERTIFICATES
WILL NOT BE SENT TO SHAREHOLDERS AND THE RIGHTS WILL AUTOMATICALLY TRADE WITH
THE COMMON STOCK.
Until the close of business on the tenth day (or such later date as may be
determined by action of the Board of Directors) after the earlier to occur of
(i) a public announcement that a person or group of affiliated or associated
persons has acquired beneficial ownership of 20% or more of the Company's voting
stock ("Acquiring Person"), except that Acquiring Person shall not include (A)
the Company, (B) any subsidiary of the Company, (C) any employee benefit plan or
employee stock plan of the Company or of any subsidiary of the Company, (D) any
person whose ownership of 20% or more of the shares of voting stock of the
Company then outstanding results from a transaction or transactions approved by
the Continuing Directors (as defined in the Rights Agreement) and effected
before such person acquires such 20% beneficial ownership (provided that such
person shall become an Acquiring Person upon his acquisition of an additional 1%
of the Company's voting stock unless otherwise approved by the Continuing
Directors), (E) any person whose beneficial ownership of shares of voting stock
of the Company is increased to 20% or more of the shares of voting stock of the
Company then outstanding solely by reason of a reduction in the number of issued
and outstanding shares of voting stock of the Company pursuant to a transaction
or transactions approved by the Continuing Directors of the Company (provided
that such person shall become an Acquiring Person upon his acquisition of an
additional 1% of the Company's voting stock unless otherwise approved by the
Continuing Directors), (F) any person whose ownership of 20% or more of the
shares of voting stock of the Company then outstanding results from any action
or transaction deemed by a resolution of the Continuing Directors of the Company
not to cause such person to become an Acquiring Person which resolution is
passed prior to such person otherwise becoming an Acquiring Person (provided
such person shall become an Acquiring Person upon his acquisition of an
additional 1% of the Company's voting stock unless otherwise approved by the
Continuing Directors), (G) any person who on the date of the Rights Agreement
owned 20% or more of the shares of voting stock of the Company then outstanding
(provided such person shall become an Acquiring Person upon his acquisition of
an additional 1% of the Company's voting stock), or (H) any Existing Control
Person (as defined in the Rights Agreement), or (ii) the date of the
commencement or announcement of a person's or group's intention to commence a
tender or exchange offer (other than a tender or exchange offer by the Company,
any subsidiary of the Company, any employee benefit plan of the Company or of
any subsidiary of the Company or any Existing Control Person) whose consummation
would result in the ownership of 20% or more of the outstanding shares of Common
Stock of the Company, even if no purchases actually occur pursuant to such offer
(the earlier of such dates being called the "Distribution Date"), the Rights
will be evidenced, with respect to any of the Common Stock certificates
outstanding as of January 21, 1997, by such Common Stock certificate. The Rights
Agreement provides that, until the Distribution Date, the Rights will be
represented by and transferred with, and only with, the Common Stock. Until the
Distribution Date (or earlier redemption or expiration of the Rights), new
Common Stock certificates issued after January 21, 1997 will contain a legend
incorporating the Rights Agreement by reference. Until the Distribution Date (or
earlier redemption or expiration of the Rights), the surrender for transfer of
any Common Stock certificates with or without a copy of this Summary of Rights
attached thereto, will also constitute the transfer of the Rights associated
with the Common Stock represented by such certificate. As soon as practicable
following the Distribution Date, separate certificates evidencing the Rights
("Right Certificates") will be mailed to holders of record of the Common Stock
as of the close of business on the Distribution Date and such separate
certificates alone will evidence the Rights from and after the Distribution
Date.
The Rights are not exercisable until the Distribution Date. The Rights will
expire at the close of business on January 10, 2007, unless earlier redeemed by
the Company as described below. At any time on or prior to the close of business
on the earlier of (i) the tenth day after a public announcement that a person
has become an Acquiring Person (or such later date as a majority of the
Continuing Directors may determine) or (ii) January 10, 2007, the Company may
redeem the Rights in whole, but not in part, at a price of $.01 per Right (the
"Redemption Price"). Immediately upon the action of the Board of Directors of
the Company authorizing redemption of the Rights, the right to exercise the
Rights will terminate and the only right of the holders of Rights will be to
receive the Redemption Price.
The Series A Preferred Stock is nonredeemable and, unless otherwise provided in
connection with the creation of a subsequent series of preferred stock,
subordinate to any other series of the Company's preferred stock. Series A
Preferred Stock may not be issued except upon exercise of the Rights. Each share
of Series A Preferred Stock will be entitled to receive when, as and if
declared, a quarterly dividend in an amount equal to the greater of $.75 per
share or 100 times the cash dividends declared on a share of Common Stock. In
the event that any preferential cash dividends to which the holders of any
current or future series of the Company's preferred stock, including the Series
A Preferred Stock, are entitled has accrued for four or more quarterly dividend
payment periods, whether consecutive or not, and shall not have been declared
and paid (or a sum sufficient for the payment thereof shall not have been set
aside) in full, the holders of such series of preferred stock shall have the
right, acting as a single voting group to elect two directors to the Company's
Board of Directors and to continue to have two directors on the Board of
Directors for so long as any such dividends remain unpaid (or a sum sufficient
for the payment thereof has not been set aside) in full.
In addition, each share of Series A Preferred Stock is entitled to 100 times any
non-cash dividends (other than dividends payable in equity securities) declared
on each share of Common Stock, in like kind. In the event of the liquidation of
the Company, the holders of the Series A Preferred Stock will be entitled to
receive a liquidation payment in an amount equal to the greater of $40 per one
one-hundredth share or 100 times the payment made per share of Common Stock.
Each share of Series A Preferred Stock will have 100 votes, voting together with
the Common Stock. In the event of any merger, consolidation or other transaction
in which Common Stock is exchanged, each share of Series A Preferred Stock will
be entitled to receive 100 times the amount received per share of Common Stock.
The rights of the Series A Preferred Stock as to dividends, liquidation and
voting are protected by anti-dilution provisions.
The Purchase Price payable, and the number of one one-hundredth (1/100th) of a
share of Series A Preferred Stock or shares of Common Stock or other securities
issuable upon exercise of the Rights are subject to certain adjustments from
time to time to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Series A Preferred Stock,
(ii) in the event of extraordinary distributions of cash or distributions of
evidences of indebtedness or other assets to holders of Series A Preferred Stock
and (iii) upon the grant to holders of Series A Preferred Stock of certain
rights or warrants to subscribe for or purchase Series A Preferred Stock or
securities convertible into Series A Preferred Stock at a price less than the
current fair market value of the Series A Preferred Stock.
Unless the Rights are earlier redeemed or the transaction is approved by the
Continuing Directors, in the event that, after the Rights have become
exercisable, the Company were to be acquired in a merger or other business
combination (in which any shares of the Common Stock are changed into or
exchanged for other securities or assets) or more than 50% of the assets or
earning power of the Company and its subsidiaries (taken as a whole) were to be
sold or transferred in one or a series of related transactions, the Rights
Agreement provides that proper provision will be made so that each holder of
record of a Right will, from and after such date, have the right to receive,
upon payment of the Purchase Price, that number of shares of common stock of the
acquiring company having a market value at the time of such transaction equal to
two times the Purchase Price. In addition, unless the Rights are earlier
redeemed or the transaction is approved by the Continuing Directors, in the
event that a person or group, with certain exceptions, becomes the beneficial
owner of 20% or more of the Company's voting stock, the Rights Agreement
provides that proper provisions will be made so that each holder of record of a
Right, other than the Acquiring Person (whose Rights will thereupon become null
and void), will thereafter have the right to receive, upon payment of the
Purchase Price, that number of shares of Common Stock of the Company having a
market value at the time of the transaction equal to two times the Purchase
Price.
No adjustment in the Purchase Price will be required until cumulative
adjustments require an adjustment of at least one percent in such Purchase
Price. Fractions of shares of Series A Preferred Stock may, at the election of
the Company, be evidenced by depositary receipts. The Company may also issue
cash in lieu of fractional shares of Common Stock and in lieu of fractional
shares of Series A Preferred Stock which are not integral multiples of
one-hundredth of a share.
Until a Right is exercised, the holder, as such, will have no rights as a
shareholder of the Company, including, without limitation, the right to vote or
to receive dividends, except that the Company's Articles of Incorporation may
not be amended so as to adversely affect the rights, preferences and limitations
of the Series A Preferred Stock without approval of (i) the holders of the then
outstanding Rights and (ii) the holders of the then outstanding shares of Series
A Preferred Stock. Such approval shall be by a majority vote, with the holders
of the Rights and the holders of the Series A Preferred Stock voting together as
a single voting group; provided, however, that the holder of each share of
Series A Preferred Stock shall have one vote and the holder of each Right shall
have one one-hundredth (1/100th) of a vote with respect to each such amendment.
A copy of the Rights Agreement has been filed with the Securities and Exchange
Commission as an Exhibit to a Registration Statement on Form 8-K dated as of
January 10, 1997. A copy of the Rights Agreement is available free of charge
from the Secretary of the Company. This summary description of the Rights does
not purport to be complete and is qualified in its entirety by reference to the
Rights Agreement which is incorporated in this summary description by reference.
Exhibit C
[Form of Right Certificate]
Certificate No. W- _________ Rights
NOT EXERCISABLE AFTER JANUARY 10, 2007 OR EARLIER IF REDEEMED. THE
RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY AND
UNDER CERTAIN OTHER CIRCUMSTANCES, AT $.01 PER RIGHT ON THE TERMS SET
FORTH OR REFERRED TO IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR ANY
AFFILIATE OR ASSOCIATE THEREOF (AS DEFINED IN THE RIGHTS AGREEMENT) MAY
BECOME NULL AND VOID.* [THE BENEFICIAL OWNER OF THE RIGHTS REPRESENTED
BY THIS RIGHT CERTIFICATE IS AN ACQUIRING PERSON OR AN AFFILIATE OR
ASSOCIATE OF AN ACQUIRING PERSON. ACCORDINGLY, THIS RIGHT CERTIFICATE
AND THE RIGHTS REPRESENTED HEREBY MAY BE OR BECOME VOID IN THE
CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS AGREEMENT.]
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* The portion of the legend in brackets shall be inserted only if applicable and
shall replace the preceding sentence.
Right Certificate
BFC FINANCIAL CORPORATION
This certifies that _______________________, or registered assigns, is the
registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the Rights
Agreement dated as of January 10, 1997 (the "Rights Agreement") between BFC
Financial Corporation, a Florida corporation (the "Company"), and ▇▇▇▇▇ ▇▇▇▇▇▇
Shareholder Services, L.L.C. (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. (Miami time) on January 10, 2007 at the office
of the Rights Agent designated for such purpose, or its successors as Rights
Agent, one one-hundredth (1/100th) of a fully paid nonassessable share of the
Series A Junior Participating Preferred Stock (the "Series A Preferred Stock")
of the Company at a purchase price of $40, as the same may from time to time be
adjusted in accordance with the Rights Agreement (the "Purchase Price"), upon
presentation and surrender of this Right Certificate with the Form of Election
to Purchase duly executed.
As provided in the Rights Agreement, the Purchase Price and the number of one
one-hundredths of a share of Series A Preferred Stock which may be purchased
upon the exercise of the Rights evidenced by this Right Certificate are subject
to modification and adjustment upon the happening of certain events and, upon
the happening of certain events, securities other than Series A Preferred Stock,
or other property, may be acquired upon exercise of the Rights evidenced by this
Right Certificate, as provided by 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 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 of the Rights Agent, the Company and
the holders of record of the Right Certificates. Copies of the Rights Agreement
are on file at the principal executive office of the Company and at the office
of the Rights Agent designated for such purpose.
This Right Certificate, with or without other Right Certificates, upon surrender
at the office of the Rights Agent designated for such purpose, may be exchanged
for another Right Certificate or Right Certificates of like tenor and date
evidencing Rights entitling the holder of record to purchase a like aggregate
number of one one-hundredths of a share of Series A 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
thereof, 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 or under certain other
circumstances at a redemption price of $.01 per Right.
No fractional Series A Preferred Stock (other than fractions which are integral
multiples of one-hundredth of a share of Series A Preferred Stock) are required
to be issued upon the exercise of any Right or Rights evidenced hereby, and in
lieu thereof the Company may cause depositary receipts to be issued and/or a
cash payment may be made, as provided in the Rights Agreement.
No holder of this Right Certificate, as such, shall be entitled to vote or
receive distributions or be deemed for any purpose the holder of Series A
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 shareholder of the Company or any right to vote upon any
matter submitted to the shareholders of the Company at any meeting thereof, or
to give or withhold consent to any Company action or to receive notice of
meetings or other actions affecting shareholders of the Company (except as
provided in the Rights Agreement), or to receive distributions or subscription
rights, or otherwise, until the Right or Rights evidenced by this Right
Certificate shall have been exercised as provided in the Rights Agreement;
provided, however, that the Company's Articles of Incorporation may not be
amended so as to adversely affect the rights, preferences and limitations of the
Series A Preferred Stock without approval of (i) the holders of the then
outstanding Rights and (ii) the holders of the then outstanding shares of Series
A Preferred Stock. Such approval shall be by a majority vote, with the holders
of the Rights and the holders of the Series A Preferred Stock voting together as
a single voting group; provided further, however, that the holder of each share
of Series A Preferred Stock shall have one vote and the holder of each Right
shall have one one-hundredth of a vote with respect to each such amendment.
This Right Certificate shall not be valid or obligatory for any purpose until it
shall have been countersigned by the Rights Agent.
IN WITNESS WHEREOF, the parties hereto have executed this Right Certificate as
of the ___ day of _______________, _________.
ATTEST: BFC FINANCIAL CORPORATION
___________________________ By: _____________________
Title: Title:___________________
Countersigned:
▇▇▇▇▇ ▇▇▇▇▇▇ SHAREHOLDER SERVICES, L.L.C.
By:________________________
Authorized Signature
[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 Certificates.)
FOR VALUE RECEIVED ________________________________________
hereby sells, assigns and transfers unto_____________________________________
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(Please print name and address of transferee)
Rights evidenced by this Right Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and appoint __________
__________________ Attorney to transfer the within Right Certificate on the
books of the within-named Company, with full power of substitution.
Dated: ________________, ______
---------------------
Signature
Signature Guaranteed:
Certificate
The undersigned hereby certifies by checking the appropriate
boxes that:
(1) this Right Certificate [ ] is [ ] is not being sold, assigned or
transferred by or on behalf of a Person who is or was an Acquiring Person or an
Associate or an Affiliate thereof (as such terms are defined pursuant to the
Rights Agreement); and
(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 thereof (as such terms are defined pursuant to the Rights Agreement).
Dated: ____________, ____
---------------------
Signature
NOTICE
The signature to the foregoing Assignment and Certificate must correspond
to the name as written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.
FORM OF ELECTION TO PURCHASE
(To be executed if registered holder desires to exercise
the Right Certificate.)
TO BFC FINANCIAL CORPORATION
The undersigned hereby irrevocably elects to exercise ______________
_____________________________________________________ Rights represented by this
Right Certificate to purchase the Series A Preferred Stock or other securities
issuable upon the exercise of such Rights and requests that certificates for
such share(s) be issued in the name:
Please insert social security
or other identifying number: _______________________________________________
-----------------------------------------------------------------------------
(Please print name and address)
-----------------------------------------------------------------------------
If such number of Rights shall not be all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:
Please insert social security
or other identifying number: _______________________________________________
-----------------------------------------------------------------------------
(Please print name and address)
-----------------------------------------------------------------------------
Dated: _____________, ____
--------------------------------------
Signature
(Signature must conform in all
respects to name of holder as
specified on the face of this
Right Certificate)
Signature Guaranteed: