Exhibit 4.1
▇▇▇▇▇▇ ▇▇▇▇▇ COMPANY
RIGHTS AGREEMENT
between
▇▇▇▇▇▇ ▇▇▇▇▇ COMPANY
and
THE FIRST NATIONAL BANK OF BOSTON,
as Rights Agent
Dated as of February 9, 1996
TABLE OF CONTENTS
Section 1. Certain Definitions.............................................1
Section 2. Appointment of Rights Agent.....................................6
Section 3. Issuance of Rights Certificates.................................6
Section 4. Form of Rights Certificates.....................................8
Section 5. Countersignature and Registration...............................9
Section 6. Transfer, Split Up, Combination and Exchange
of Rights Certificates; Mutilated, Destroyed, Lost
or Stolen Rights Certificates...................................9
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights......................................10
Section 8. Cancellation and Destruction of Rights Certificates............12
Section 9. Reservation and Availability of Shares of Common Stock.........12
Section 10. Common Stock Record Date.......................................14
Section 11. Adjustment of Purchase Price, Number
and Kind of Shares or Number of Rights.........................14
Section 12. Certificate of Adjusted Purchase Price
or Number of Shares............................................21
Section 13. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power.....................................22
Section 14. Fractional Rights and Fractional Shares........................25
Section 15. Rights of Action; Specific Enforcement
and Injunctive Relief..........................................26
Section 16. Agreement of Rights Holders....................................26
Section 17. Rights Certificate Holder Not Deemed a Shareholder.............27
Section 18. Concerning the Rights Agent....................................27
Section 19. Merger or Consolidation or Change of Name of Rights Agent......28
Section 20. Duties of Rights Agent.........................................28
Section 21. Change of Rights Agent.........................................30
Section 22. Issuance of New Rights Certificates............................31
Section 23. Redemption and Termination.....................................31
Section 24. Notice of Certain Events.......................................32
Section 25. Notices........................................................33
Section 26. Supplements and Amendments.....................................33
Section 27. Successors.....................................................34
Section 28. Determinations and Actions by the Board, etc...................34
Section 29. Exchange.......................................................34
Section 30. Benefits of this Agreement.....................................35
Section 31. Severability...................................................36
Section 32. Governing Law..................................................36
Section 33. Counterparts...................................................36
Section 34. Descriptive Headings...........................................37
Exhibit A Summary of Rights to Purchase Common Shares
Exhibit B Form of Rights Certificates
RIGHTS AGREEMENT
This RIGHTS AGREEMENT, dated as of February 9, 1996, between ▇▇▇▇▇▇
▇▇▇▇▇ COMPANY, a Massachusetts corporation (the "Company"), and THE FIRST
NATIONAL BANK OF BOSTON, a national banking association (the "Rights Agent"),
W I T N E S S E T H:
WHEREAS, on February 9, 1996 (the "Rights Dividend Declaration Date"),
the Board of Directors of the Company authorized and declared a dividend
distribution of one Right (as hereinafter defined) for each share of Common
Stock (as hereinafter defined) of the Company outstanding at the Close of
Business (as hereinafter defined) on February 29, 1996 (the "Record Date"), and
authorized and directed the issuance of one Right (as such number may
hereinafter be adjusted pursuant to the provisions of Section 11(i) hereof) for
each share of Common Stock of the Company issued (whether originally issued or
delivered from the Company's treasury) between the Record Date and the
Distribution Date (as hereinafter defined) and under certain circumstances
thereafter, each Right initially representing the right to purchase one share of
Common Stock of the Company, upon the terms and subject to the conditions
hereinafter set forth (the "Rights");
NOW, THEREFORE, in consideration of the premises and the mutual
agreements hereinafter set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement, the
following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person who or which, together
with all Affiliates and Associates of such Person, shall be the Beneficial Owner
of 20% or more of the shares of Common Stock of the Company then outstanding,
but shall not include an Exempt Person.
(b) "Act" shall mean the Securities Act of 1933, as amended.
(c) "Adjustment Shares" shall have the meaning set forth in Section
11(a)(ii) hereof.
(d) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under
the Exchange Act.
(e) "Agreement" means this Rights Agreement as originally executed or
as it may from time to time be supplemented or amended pursuant to the
applicable provisions hereof.
(f) A Person shall be deemed the "Beneficial Owner" of, and shall be
deemed to "beneficially own", any securities:
(i) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to acquire (whether
such right is exercisable immediately or only after the passage of
time) pursuant to any agreement, arrangement or understanding (whether
or not in writing) or upon the exercise of conversion rights, exchange
rights, rights, warrants or options, or otherwise; provided, however,
that a Person shall not be deemed the "Beneficial Owner" of, or to
"beneficially own", (A) securities tendered pursuant to a tender or
exchange offer made by or on behalf of such Person or any of such
Person's Affiliates or Associates until such tendered securities are
accepted for purchase or exchange, or (B) securities issuable upon
exercise of Rights at any time prior to the occurrence of a Triggering
Event, or (C) securities issuable upon exercise of Rights from and
after the occurrence of a Triggering Event which are Original Rights or
securities issued pursuant to Section 11(i) hereof in connection with
an adjustment made with respect to any Original Rights;
(ii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to vote or dispose of
or has "beneficial ownership" of (as determined pursuant to Rule 13d-3
of the General Rules and Regulations under the Exchange Act), including
pursuant to any agreement, arrangement or understanding, whether or not
in writing; provided, however, that a Person shall not be deemed the
"Beneficial Owner" of, or to "beneficially own", any security under
this subparagraph (ii) as a result of an agreement, arrangement or
understanding to vote such security if such agreement, arrangement or
understanding: (A) arises solely from a revocable proxy or consent
given in response to a public proxy or consent solicitation made
pursuant to, and in accordance with, the applicable provisions of the
General Rules and Regulations under the Exchange Act; and (B) is not
also then reportable by such Person on Schedule 13D under the Exchange
Act (or any comparable or successor report); or
(iii) which are beneficially owned, directly or indirectly, by
any other Person (or any Affiliate or Associate thereof) with which
such Person (or any of such Person's Affiliates or Associates) has any
agreement, arrangement or understanding (whether or not in writing),
for the purpose of acquiring, holding, voting (except pursuant to a
revocable proxy as described in clause (A) of the proviso to
subparagraph (ii) of this paragraph (f)) or disposing of any voting
securities of the Company; provided, however, that nothing in this
paragraph (f) shall cause a person engaged in business as an
underwriter of securities to be the "Beneficial Owner" of, or to
"beneficially own", any securities acquired through such person's
participation in good faith in a firm commitment underwriting until the
expiration of forty days after the date of such acquisition.
(g) "Board" means the Board of Directors of the Company.
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(h) "Business Day" shall mean any day other than a Saturday, Sunday or
a day on which banking institutions in the states in which the Rights Agent is
located are authorized or obligated by law or executive order to close.
(i) "Close of Business" on any given date shall mean 5:00 P.M., Boston
time, on such date; provided, however, that if such date is not a Business Day,
it shall mean 5:00 P.M., Boston time, on the next succeeding Business Day.
(j) "Common Stock" when used with reference to the Company shall mean
the common stock, par value $2.50 per share, of the Company or any other shares
of capital stock of the Company into which such stock shall be reclassified or
changed. "Common Stock" when used with reference to any Person which shall be
organized in corporate form, other than the Company, shall mean the capital
stock or other equity security with the greatest voting power or the equity
securities or other equity interest having power to control or direct the
management of such Person or, if such Person is a Subsidiary of another Person,
the Person or Persons which ultimately control such first-mentioned Person and
which has or have issued any such outstanding capital stock, equity securities
or equity interest. "Common Stock" when used with reference to any Person which
shall not be organized in corporate form shall mean units of beneficial interest
which (i) shall represent the right to participate generally in the profits and
losses of such Person (including, without limitation, any flow-through tax
benefits resulting from an ownership interest in such Person) and (ii) shall be
entitled to exercise the greatest voting power of such Person or, in the case of
a limited partnership, shall have the power to remove the general partner or
partners.
(k) "Common Stock Equivalents" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(l) "Company" shall mean the Person named as the "Company" in the first
paragraph of this Agreement until a successor corporation shall have become
such, or until a Principal Party shall assume, and thereafter be liable for, all
obligations and duties of the Company hereunder pursuant to the applicable
provisions of this Agreement, and thereafter "Company" shall mean such successor
corporation or Principal Party.
(m) "Continuing Director" shall mean any member of the Board (while
such Person is a member of the Board) who is not an Acquiring Person, or an
Affiliate or Associate of an Acquiring Person, or a representative or nominee of
an Acquiring Person or of any such Affiliate or Associate, and who either (i)
was a member of the Board prior to the Stock Acquisition Date or (ii) on or
subsequent to the Stock Acquisition Date became a member of the Board and whose
nomination for election or election to the Board was recommended or approved by
a majority of the Continuing Directors then on the Board.
(n) "Current Market Price" shall have the meaning set forth in Section
11(d) hereof.
(o) "Current Value" shall have the meaning set forth in Section
11(a)(iii) hereof.
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(p) "Distribution Date" shall have the meaning set forth in Section
3(a) hereof.
(q) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(r) "Exchange Ratio" shall have the meaning set forth in Section 29(a)
hereof.
(s) "Exempt Person" shall mean (i) the Company, (ii) any Subsidiary of
the Company, (iii) any employee benefit or employee stock plan of the Company or
of any Subsidiary of the Company, (iv) any Person or entity organized,
appointed, established or holding Common Stock of the Company by, for or
pursuant to the terms of any such plan, (v) any Person who becomes an Acquiring
Person solely as a result of a reduction in the number of shares of Common Stock
of the Company outstanding due to the repurchase of shares of Common Stock of
the Company by the Company, unless and until any such Person shall purchase or
otherwise become the Beneficial Owner of additional shares of Common Stock of
the Company constituting 1% or more of the then-outstanding shares of Common
Stock of the Company or (vi) any Person who or which shall have executed a
written agreement with the Company (which shall have been approved by a majority
of the Outside Directors) prior to the date on which such Person became the
Beneficial Owner of 20% or more of the shares of Common Stock of the Company
then outstanding, which agreement imposes one or more limitations (the
"Thresholds") on the amount of such Person's Beneficial Ownership of shares of
Common Stock, if and so long as the Thresholds continue to be binding on such
Person and such Person is in substantial compliance (as determined by a majority
of the Outside Directors) with the terms of such written agreement.
(t) "Expiration Date" shall have the meaning set forth in Section 7(a)
hereof.
(u) "Final Expiration Date" shall mean the Close of Business on
February 8, 2006.
(v) "Original Rights" shall mean Rights acquired by a Person or any of
such Person's Affiliates or Associates prior to the Distribution Date or
pursuant to Section 3(a) or Section 22 hereof.
(w) "Outside Directors" shall mean members of the Board who are not
officers of the Company or any of its Subsidiaries or officers or stockholders
of the Company's investment advisor and who are not Acquiring Persons or
representatives, nominees, Affiliates or Associates of Acquiring Persons.
(x) "Person" shall mean any individual, firm, corporation, partnership,
trust or other entity and includes, without limitation, an unincorporated group
of persons who, by formal or informal agreement, have embarked on a common
purpose or act.
(y) "Principal Party" shall have the meaning set forth in Section 13(b)
hereof.
(z) "Purchase Price" shall have the meaning set forth in Section 4(a)
hereof
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(aa) "Record Date" shall have the meaning set forth in the recital
clause at the beginning of the Agreement.
(bb) "Redemption Price" shall have the meaning set forth in Section
23(a) hereof.
(cc) "Rights" shall have the meaning set forth in the recital clause at
the beginning of the Agreement.
(dd) "Rights Agent" shall mean the Person named as the "Rights Agent"
in the first paragraph of this Agreement until a successor Rights Agent shall
have become such pursuant to the applicable provisions hereof, and, thereafter,
"Rights Agent" shall mean such successor Rights Agent. If at any time there is
more than one Person appointed by the Company as Rights Agent pursuant to the
applicable provisions of this Agreement, "Rights Agent" shall mean and include
each such Person.
(ee) "Rights Certificates" shall have the meaning set forth in Section
3(a) hereof.
(ff) "Rights Dividend Declaration Date" shall have the meaning set
forth in the recital clause at the beginning of the Agreement.
(gg) "Section 11(a)(ii) Event" shall have the meaning set forth in
Section 11(a)(ii) hereof.
(hh) "Section 11(a)(ii) Trigger Date" shall have the meaning set forth
in Section 11(a)(iii) hereof.
(ii) "Section 13 Event" shall have the meaning set forth in Section
13(a) hereof.
(jj) "Spread" shall have the meaning set forth in Section 11(a)(iii)
hereof.
(kk) "Stock Acquisition Date" shall mean the date of the first public
announcement by the Company that an Acquiring Person has become such.
(ll) "Subsidiary" shall mean, with reference to any Person, any
corporation or other entity of which securities or other ownership interests
having ordinary voting power sufficient, in the absence of contingencies, to
elect a majority of the board of directors or other persons performing similar
functions are at the time directly or indirectly beneficially owned, or
otherwise controlled, by such Person and any Affiliate or Associate of such
Person.
(mm) "Substitution Period" shall have the meaning set forth in Section
11(a)(iii) hereof.
(nn) "Summary of Rights" shall have the meaning set forth in Section
3(a) hereof.
(oo) "Thresholds" shall have the meaning set forth in Section 11(d)(ii)
hereof.
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(pp) "Trading Day" shall have the meaning set forth in Section
11(d)(ii) hereof.
(qq) "Triggering Event" shall mean any Section 11(a)(ii) Event or any
Section 13 Event.
Section 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company and the holders of the Rights (who,
in accordance with Section 3 hereof, shall prior to the Distribution Date also
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be the holders of the Common Stock of the Company) in accordance with the terms
and subject to the 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. Any actions which may be taken by the Rights
Agent pursuant to the terms of this Agreement may be taken by any such Co-Rights
Agent.
Section 3. Issuance of Rights Certificates.
(a) Until the earlier of (i) the Close of Business on the tenth
Business Day (or such specified later date as may be determined by the Board
with the concurrence of a majority of the Continuing Directors before the
occurrence of the Distribution Date) after the Stock Acquisition Date (or, if
the tenth Business Day after the Stock Acquisition Date occurs before the Record
Date, the Close of Business on the Record Date) and (ii) the Close of Business
on the tenth Business Day (or such specified or unspecified later date as may be
determined by the Board with the concurrence of a majority of the Continuing
Directors before the occurrence of the Distribution Date) after the date that a
tender or exchange offer by any Person (other than an Exempt Person) is first
published or sent or given within the meaning of Rule 14d-2(a) of the General
Rules and Regulations under the Exchange Act, if upon consummation thereof, such
Person would be an Acquiring Person (the earlier of (i) and (ii) being herein
referred to as the "Distribution Date"), (x) the Rights will be evidenced
(subject to the provisions of paragraphs (b) and (c) of this Section 3) by the
certificates for the Common Stock of the Company registered in the names of the
holders of the Common Stock of the Company (which certificates for Common Stock
of the Company shall be deemed also to be certificates for Rights) and not by
separate certificates and (y) the Rights will be transferable only in connection
with the transfer of the associated shares of Common Stock of the Company
(including a transfer to the Company). As soon as practicable after the
Distribution Date, the Rights Agent will send by first-class, insured,
postage-prepaid mail, to each record holder of the Common Stock of the Company
as of the Close of Business on the Distribution Date, at the address of such
holder shown on the records of the Company, one or more rights certificates in
substantially the form of Exhibit B hereto (the "Rights Certificates")
evidencing one Right for each share of Common Stock of the Company so held,
subject to adjustment as provided herein. In the event that an adjustment in the
number of Rights per share of Common Stock of the Company has been made pursuant
to Section 11(i) hereof, at the time of distribution of the Rights Certificates,
the Company shall make the necessary and appropriate rounding adjustments (in
accordance with Section 14(a) hereof) so that Rights Certificates representing
only whole numbers of Rights are distributed and cash is paid in lieu of any
fractional Rights. As of and after the Distribution Date, the Rights will be
evidenced solely by such Rights Certificates.
(b) As promptly as practicable following the Record Date, the Company
will send a copy of the Summary of Rights by first-class, postage-prepaid mail,
to each record holder of the Common Stock of the Company as of the Close of
Business on the Record Date, at the address of such holder shown on the records
of the Company. With respect to certificates for the Common Stock of the Company
outstanding as of the Record Date, as set forth in paragraph (a) above, until
the earlier of the Distribution Date and the Expiration Date, the Rights will be
evidenced by such certificates for the Common Stock of the Company with or
without a copy of the Summary of Rights (attached hereto as Exhibit A) attached,
and the registered holders of the Common Stock of the Company shall also be the
registered holders of the associated Rights. Until the earlier of the
Distribution Date and the Expiration Date, the transfer of any certificates
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representing shares of Common Stock of the Company in respect of which Rights
have been issued shall also constitute the transfer of the Rights associated
with such shares of Common Stock of the Company.
(c) Rights shall be issued in respect of all shares of Common Stock of
the Company which are issued (whether originally issued or from the Company's
treasury) after the Record Date but prior to the earlier of the Distribution
Date and the Expiration Date, and to the extent provided in Section 22 hereof,
in respect of shares of Common Stock of the Company issued after the
Distribution Date and prior to the Expiration Date. Certificates representing
such shares of Common Stock of the Company shall also be deemed to be
certificates for Rights, and shall, as promptly as practicable following the
Record Date, bear the following legend:
"This certificate also evidences and entitles the holder
hereof to certain Rights as set forth in the Rights Agreement between
▇▇▇▇▇▇ ▇▇▇▇▇ Company (the "Company") and The First National Bank of
Boston (the "Rights Agent") dated as of February 9, 1996 (the "Rights
Agreement"), the terms of which are hereby incorporated herein by
reference and a copy of which is on file at the principal offices of
the Company. Under certain circumstances, as set forth in the Rights
Agreement, such Rights will be evidenced by separate certificates and
will no longer be evidenced by this certificate. The Company will mail
to the holder of this certificate a copy of the Rights Agreement, as in
effect on the date of mailing, without charge promptly after receipt of
a written request therefor. Under certain circumstances set forth in
the Rights Agreement, Rights beneficially owned (as such term is
defined in the Rights Agreement) by any Person who is, was or becomes
an Acquiring Person, or any Affiliate or Associate thereof (as such
terms are defined in the Rights Agreement), whether currently held by
or on behalf of such Person or by any subsequent holder, may become
null and void. The Rights shall not be exercisable, and shall be void
so long as held, by a holder in any jurisdiction where the requisite
qualification to the issuance to such holder, or the exercise by such
holder, of the Rights in such jurisdiction shall not have been obtained
or be obtainable."
With respect to such certificates containing the foregoing legend,
until the earlier of the Distribution Date and the Expiration Date, the Rights
associated with the Common Stock of the Company represented by such certificates
shall be evidenced by such certificates alone, and registered holders of Common
Stock of the Company shall also be the registered holders of the associated
Rights, and the transfer of any of such certificates shall also constitute the
transfer of the Rights associated with the Common Stock of the Company
represented by such certificates.
Section 4. Form of Rights Certificates.
(a) The Rights Certificates (and the forms of election to purchase and
of assignment to be printed on the reverse thereof) shall each be substantially
in the form set forth in Exhibit B hereto and may have such marks of
identification or designation and such legends, summaries or endorsements
printed thereon as the Company may deem appropriate and as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with any
rule or regulation of any stock market or exchange on which the Rights may from
time to time be listed or traded, or to conform to usage. Subject to the
provisions of Section 11 and Section 22 hereof, the Rights Certificates,
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whenever distributed, shall be dated as of the Record Date and on their face
shall entitle the holders thereof to purchase such number of shares of Common
Stock of the Company as shall be set forth therein at the exercise price set
forth therein (such exercise price per share, as adjusted from time to time
hereunder, the "Purchase Price"), but the amount and type of securities
purchasable upon the exercise of each Right and the Purchase Price thereof shall
be subject to adjustment as provided herein.
(b) Any Rights Certificate issued pursuant to Section 3(a) or Section
22 hereof that represents Rights beneficially owned by (i) an Acquiring Person
or any Associate or Affiliate of an Acquiring Person, (ii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person becomes such or (iii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee prior to or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person to holders of equity interests in such
Acquiring Person or to any Person with whom such Acquiring Person has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (B) a transfer which a majority of the Continuing Directors has
determined, in its sole discretion, is part of a plan, arrangement or
understanding which has as a primary purpose or effect avoidance of Section 7(e)
hereof, and any Rights Certificate issued pursuant to Section 6 or Section 11
hereof upon transfer, exchange, replacement or adjustment of any other Rights
Certificate referred to in this sentence, shall contain (to the extent feasible)
the following legend:
"The Rights represented by this Rights Certificate are or were
beneficially owned by a Person who was or became an Acquiring Person or
an Affiliate or Associate of an Acquiring Person (as such terms are
defined in the Rights Agreement). Accordingly, this Rights Certificate
and the Rights represented hereby may become null and void in the
circumstances specified in Section 7(e) of such Rights Agreement."
Section 5. Countersignature and Registration.
(a) The Rights Certificates shall be executed under seal (or with the
same force and effect as a document executed under seal) on behalf of the
Company by the Chairman of its Board of Directors, its President or any Vice
President and by the Treasurer or any Assistant Treasurer, either manually or by
facsimile signature. The Rights Certificates shall be manually countersigned by
the Rights Agent and shall not be valid for any purpose unless so countersigned.
In case any officer of the Company who shall have signed any of the Rights
Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the Company,
such Rights Certificates, nevertheless, may be countersigned by the Rights Agent
and issued and delivered by the Company with the same force and effect as though
the person who signed such Rights Certificates had not ceased to be such officer
of the Company; and any Rights Certificates may be signed on behalf of the
Company by any person who, at the actual date of the execution of such Rights
Certificate, shall be a proper officer of the Company to sign such Rights
Certificate, although at the date of the execution of this Rights Agreement any
such person was not such an officer.
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(b) Following the Distribution Date, the Rights Agent will keep or
cause to be kept, at its principal office or offices designated as the
appropriate place for surrender of Rights Certificates upon exercise or
transfer, books for registration and transfer of the Rights Certificates issued
hereunder. Such books shall show the names and addresses of the respective
holders of the Rights Certificates, the number of Rights evidenced on its face
by each of the Rights Certificates and the date of each of the Rights
Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Rights
Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates.
(a) Subject to the provisions of Section 4(b), Section 7(e) and Section
14 hereof, at any time after the Close of Business on the Distribution Date, and
at or prior to the Close of Business on the Expiration Date, any Rights
Certificate or Rights Certificates may be transferred, split up, combined or
exchanged for another Rights Certificate or Rights Certificates, entitling the
registered holder to purchase a like number of shares of Common Stock (or,
following a Triggering Event, Common Stock and/or such other securities, cash or
other assets as may be issuable in respect of Rights in accordance with the
terms of this Agreement) as the Rights Certificate or Rights Certificates
surrendered then entitled such holder (or former holder in the case of a
transfer) to purchase. Any registered holder desiring to transfer, split up,
combine or exchange any Rights Certificate or Rights Certificates shall make
such request in writing delivered to the Rights Agent, and shall surrender the
Rights Certificate or Certificates to be transferred, split up, combined or
exchanged at the principal office or offices of the Rights Agent designated for
such purpose. Neither the Rights Agent nor the Company shall be obligated to
take any action whatsoever with respect to the transfer or exchange of any such
surrendered Rights Certificate or Rights Certificates until the registered
holder shall have completed and signed the certificate contained in the form of
assignment on the reverse side of such Rights Certificate or Rights Certificates
and shall have provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates or Associates
thereof as the Company shall reasonably request. Thereupon the Rights Agent
shall, subject to Section 4(b), Section 7(e) and Section 14 hereof, countersign
and deliver to the Person entitled thereto a Rights Certificate or Rights
Certificates, as the case may be, as so requested. The Company may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer, split up, combination or exchange of
Rights Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to each of them of the loss, theft, destruction or
mutilation of a valid Rights Certificate, and, in case of loss, theft or
destruction, of indemnity or security reasonably satisfactory to each of them,
and reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender to the Rights Agent and cancellation of
the Rights Certificate if mutilated, the Company will execute and deliver a new
Rights Certificate of like tenor to the Rights Agent for countersignature and
delivery to the registered owner in lieu of the Rights Certificate so lost,
stolen, destroyed or mutilated.
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Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights.
(a) Subject to Section 7(e) hereof, the registered holder of any Rights
Certificate may exercise the Rights evidenced thereby (except as otherwise
provided herein including, without limitation, the restrictions on exercise set
forth in Section 9(c), Section 11(a)(iii) and Section 23(a) hereof) in whole or
in part at any time and from time to time after the Distribution Date upon
surrender of the Rights Certificate, with the form of election to purchase and
the certificate on the reverse side thereof duly executed, to the Rights Agent
at the principal office or offices of the Rights Agent designated for such
purpose, together with payment of the aggregate Purchase Price with respect to
the total number of shares of Common Stock of the Company (or other securities,
cash or other assets, as the case may be) as to which such surrendered Rights
are then exercisable, at or prior to the earliest of (i) the Final Expiration
Date, (ii) the time at which the Rights are redeemed as provided in Section 23
hereof or exchanged as provided in Section 29 hereof or (iii) the time at which
the Rights expire pursuant to Section 13(d) hereof (the earliest of (i), (ii)
and (iii) being herein referred to as the "Expiration Date").
(b) The Purchase Price for each share of Common Stock of the Company to
be issued pursuant to the exercise of a Right shall initially be $25 and shall
be subject to adjustment from time to time as provided in Sections 11 and 13(a)
hereof and shall be payable in accordance with paragraph (c) below.
(c) Upon receipt of a Rights Certificate representing exercisable
Rights, with the form of election to purchase and the certificate on the reverse
side of the Rights Certificate duly executed, accompanied by payment, with
respect to each Right so exercised, of the Purchase Price, as such amount may be
reduced pursuant to Section 11(a)(iii) hereof, per share of Common Stock of the
Company (or other shares, securities, cash or other assets, as the case may be
to be purchased as set forth below and an amount equal to any applicable
transfer tax, the Rights Agent shall, subject to Sections 7(f) and 20(k) hereof,
thereupon promptly (i) (A) requisition from any transfer agent for the shares of
Common Stock of the Company (or make available, if the Rights Agent is the
transfer agent for such shares) certificates for the total number of shares of
Common Stock to be purchased and the Company hereby irrevocably authorizes its
transfer agent to comply with all such requests, or (B) if the Company shall
have elected to deposit the total number of shares of Common Stock issuable upon
exercise of the Rights hereunder with a depositary agent, requisition from the
depositary agent depositary receipts representing such number of shares of
Common Stock as are to be purchased (in which case certificates for the shares
of Common Stock represented by such receipts shall be deposited by the transfer
agent with the depositary agent) and the Company shall direct the depositary
agent to comply with such request, (ii) requisition from the Company the amount
of cash, if any, to be paid in lieu of fractional shares in accordance with
Section 14 hereof, (iii) after receipt of such certificates or depositary
receipts, cause the same to be delivered to or upon the order of the registered
holder of such Rights Certificate, registered in such name or names as may be
designated by such holder, and (iv) after receipt thereof, deliver such cash, if
any, to or upon the order of the registered holder of such Rights Certificate.
The payment of the Purchase Price (as such amount may be reduced pursuant to
Section 11(a)(iii) hereof) shall be made in cash or by certified check,
cashier's check or bank draft payable to the order of the Company. In the event
that the Company is obligated to issue other securities (including Common Stock)
of the Company, pay cash and/or distribute other property pursuant to Section
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11(a) hereof, the Company shall make all arrangements necessary so that such
other securities, cash and/or other property are available for distribution by
the Rights Agent, if and when appropriate. The Company reserves the right to
require, prior to the occurrence of a Triggering Event, that, upon any exercise
of Rights, a number of Rights be exercised so that only whole shares of Common
Stock would be issued.
(d) In case the registered holder of any Rights Certificate shall
exercise less than all the Rights evidenced thereby, a new Rights Certificate
evidencing Rights equivalent to the Rights remaining unexercised shall be issued
by the Company and delivered by the Rights Agent to, or upon the order of, the
registered holder of such Rights Certificate, registered in such name or names
as may be designated by such holder, subject to the provisions of Section 14
hereof.
(e) Notwithstanding anything in this Agreement to the contrary, from
and after the first occurrence of a Section 11(a)(ii) Event, any Rights
beneficially owned by (i) an Acquiring Person or an Associate or Affiliate of an
Acquiring Person which a majority of the Continuing Directors in its sole
discretion determines is or was involved in or caused or facilitated, directly
or indirectly, such Section 11(a)(ii) Event, (ii) a transferee of any such
Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee after such Acquiring Person becomes such or (iii) a transferee of any
such Acquiring Person (or of any such Associate or Affiliate) who becomes a
transferee prior to or concurrently with such Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from such Acquiring Person to holders of equity interests in such
Acquiring Person or to any Person with whom such Acquiring Person has any
continuing agreement, arrangement or understanding regarding the transferred
Rights or (B) a transfer which a majority of the Continuing Directors has
determined in its sole discretion is part of a plan, arrangement or
understanding which has as a primary purpose or effect the avoidance of this
Section 7(e), shall become null and void without any further action and no
holder of such Rights shall have any rights whatsoever with respect to such
Rights, whether under any provision of this Agreement or otherwise. The Company
shall use all reasonable efforts to ensure that the provisions of this Section
7(e) and Section 4(b) hereof are complied with, but the Company and the Rights
Agent shall have no liability to any holder of Rights Certificates or other
Person as a result of the Company's failure to make any determinations with
respect to an Acquiring Person or any of their Affiliates, Associates or
transferees hereunder.
(f) Notwithstanding anything in this Agreement to the contrary, neither
the Rights Agent nor the Company shall be obligated to undertake any action with
respect to a registered holder of any Rights Certificate upon the occurrence of
any purported exercise as set forth in this Section 7 unless such registered
holder shall have (i) completed and signed the certificate contained in the form
of assignment or election to purchase set forth on the reverse side of the
Rights Certificate surrendered for such assignment or exercise and (ii) provided
such additional evidence of the identity of the Beneficial Owner (or former
Beneficial Owner) or Affiliates or Associates thereof as the Company shall
reasonably request.
Section 8. Cancellation and Destruction of Rights Certificates. All
Rights Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or any of its
agents, be delivered to the Rights Agent for cancellation or in cancelled form
or, if surrendered to the Rights Agent, shall be cancelled by it, and no Rights
Certificates shall be issued in lieu thereof except as expressly permitted by
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any of the provisions of this Agreement. The Company shall deliver to the Rights
Agent for cancellation and retirement, and the Rights Agent shall so cancel and
retire, any other Rights Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall deliver all
cancelled Rights Certificates to the Company or shall, at the written request of
the Company, destroy such cancelled Rights Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Shares of Common Stock.
(a) The Company covenants and agrees that it will cause to be reserved
and kept available out of its authorized and unissued shares of Common Stock
(and, following the occurrence of a Triggering Event, out of its authorized and
unissued shares of Common Stock and/or other securities or out of its authorized
and issued shares held in its treasury) the number of shares of Common Stock
(and, following the occurrence of a Triggering Event, Common Stock and/or other
securities) that, as provided in this Agreement (including Section 11(a)(iii)
hereof), will be sufficient to permit the exercise in full of all outstanding
Rights.
(b) So long as the shares of Common Stock (and, following the
occurrence of a Triggering Event, Common Stock and/or other securities) issuable
and deliverable upon the exercise of the Rights may be listed on any national
securities exchange, the Company shall use its reasonable efforts to cause, from
and after such time as the Rights become exercisable, all shares reserved for
such issuance to be listed on such exchange upon official notice of issuance
upon such exercise.
(c) The Company shall use all reasonable efforts (i) to file, as soon
as practicable following the earliest date after the first occurrence of a
Triggering Event on which the consideration to be delivered by the Company upon
exercise of the Rights has been determined in accordance with this Agreement, a
registration statement under the Act on an appropriate form with respect to the
securities purchasable upon exercise of the Rights, (ii) to cause such
registration statement to become effective as soon as practicable after such
filing and (iii) to cause such registration statement to remain effective (with
a prospectus at all times meeting the requirements of the Act) until the earlier
of (A) the date as of which the Rights are no longer exercisable for such
securities and (B) the Expiration Date. The Company will also take such action
as may be appropriate under, or to ensure compliance with, the securities or
"blue sky" laws of the various states in connection with the exercisability of
the Rights. The Company may, acting by resolution of its Board (which resolution
shall be effective only with the concurrence of a majority of the Continuing
Directors), temporarily suspend, for a period of time not to exceed ninety (90)
days after the date set forth in clause (i) of the first sentence of this
Section 9(c), the exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective. In the event of any
such suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as well as a public
announcement at such time as the suspension is no longer in effect. In addition,
if the Company shall determine that a registration statement is required in
other circumstances following the Distribution Date, the Company may similarly
temporarily suspend the exercisability of the Rights until such time as a
registration statement has been declared effective. Notwithstanding any
provision of this Agreement to the contrary, the Rights shall not be exercisable
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in any jurisdiction if the requisite qualification in such jurisdiction shall
not have been obtained, the exercise thereof shall not otherwise be permitted
under applicable law or a registration statement shall not have been declared
effective.
(d) The Company covenants and agrees that it will take all such action
as may be necessary to ensure that all shares of Common Stock (and, following
the occurrence of a Triggering Event, 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 Purchase Price), be duly
and validly authorized and issued, fully paid and nonassessable.
(e) The Company further covenants and agrees that, except as set forth
in Section 6(a) hereof, it will pay when due and payable any and all federal and
state transfer taxes and charges which may be payable in respect of the issuance
or delivery of the Rights Certificates and of any certificates for a number of
shares of Common Stock (or Common Stock and/or other securities, as the case may
be) upon the exercise of Rights. The Company shall not, however, be required to
pay any transfer tax which may be payable in respect of any transfer or delivery
of Rights Certificates to a Person other than, or the issuance or delivery of a
number of shares of Common Stock (or Common Stock and/or other securities, as
the case may be) in respect of a name other than that of, the registered holder
of the Rights Certificates evidencing Rights surrendered for exercise, nor shall
the Company be required to issue or deliver any certificates for a number of
shares of Common Stock (or Common Stock and/or other securities, as the case may
be) in a name other than that of the registered holder upon the exercise of any
Rights until such tax shall have been paid (any such tax being payable by the
holder of such Rights Certificate at the time of surrender) or until it has been
established to the Company's satisfaction that no such tax is due.
Section 10. Common Stock Record Date. Each person in whose name any
certificate for a number of shares of Common 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 such fractional
shares of Common Stock (or Common Stock and/or other securities, as the case may
be) represented thereby on, and such certificate shall be dated, the date upon
which the Rights Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and all applicable transfer taxes) was made;
provided, however, that if the date of such surrender and payment is a date upon
which the Common Stock (or Common Stock and/or other securities, as the case may
be) transfer books of the Company are closed, such Person shall be deemed to
have become the record holder of such shares (fractional or otherwise) on, and
such certificate shall be dated, the next succeeding Business Day on which the
transfer books of the Company relating to its Common Stock (or Common Stock
and/or other securities, as the case may be) are open. Prior to the exercise of
the Rights evidenced thereby, the holder of a Rights Certificate 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 Purchase Price, Number and Kind of Shares or
Number of Rights. The Purchase Price, the number and kind of shares, or
fractions thereof, purchasable upon the exercise of each Right and the number of
Rights outstanding are subject to adjustment from time to time as provided in
this Section 11.
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(a) (i) In the event that the Company shall at any time after the date
of this Agreement (A) declare a dividend on its Common Stock payable in
shares of Common Stock, (B) subdivide or split its outstanding Common
Stock, (C) combine or consolidate its outstanding Common Stock into a
smaller number of shares or (D) issue any shares of its capital stock
in a reclassification of its Common Stock (including any such
reclassification in connection with a consolidation or merger in which
the Company is the continuing or surviving corporation), except as
otherwise provided in this Section 11(a) and Section 7(e) hereof, the
Purchase Price in effect at the time of the record date for such
dividend or of the effective date of such subdivision, split,
combination, consolidation or reclassification, and the number and kind
of shares of Common Stock (or other capital stock, as the case may be)
issuable on such date shall be proportionately adjusted so that the
holder of any Right exercised after such time shall be entitled to
receive, upon payment of the Purchase Price then in effect, the
aggregate number and kind of shares of Common Stock (or other 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 relating to such Common Stock (or other capital stock, as
the case may be) were open, such holder would have owned upon such
exercise and been entitled to receive by virtue of such dividend,
subdivision, split, combination, consolidation or reclassification. If
an event occurs which would require an adjustment under both this
Section 11(a)(i) and Section 11(a)(ii) hereof, the adjustment provided
for in this Section 11(a)(i) shall be in addition to, and shall be made
prior to, any adjustment required pursuant to Section 11(a)(ii) hereof.
(ii) In the event (a "Section 11(a)(ii) Event") that any
Person (other than an Exempt Person) alone or together with its
Affiliates and Associates (other than Exempt Persons) shall, at any
time after the Rights Dividend Declaration Date, become an Acquiring
Person, unless the event causing such Person to become an Acquiring
Person is (x) a Section 13 Event or (y) an acquisition of shares of
Common Stock of the Company pursuant to a tender offer or an exchange
offer for all outstanding shares of Common Stock of the Company at a
price and on terms determined by at least a majority of the Outside
Directors, after receiving advice from one or more investment banking
firms, to be (a) at a price which is fair to shareholders (taking into
account all factors which such Outside Directors deem relevant
including, without limitation, prices which could reasonably be
achieved if the Company or its assets were sold on an orderly basis
designed to realize maximum value) and (b) otherwise in the best
interests of the Company, its shareholders, its employees, suppliers,
creditors, customers and such other constituencies as may be taken into
consideration pursuant to Section 65 of Chapter 156B of the General
Laws of Massachusetts, then promptly after the date of occurrence of
such Section 11(a)(ii) Event, proper provision shall be made so that
each holder of a Right (except as provided below and in Section 7(e)
hereof) shall thereafter have the right to receive, upon exercise
thereof at the then-current Purchase Price in accordance with the terms
of this Agreement, in lieu of a number of shares of Common Stock of the
Company determined according to Section 7(a) hereof, such number of
shares of Common Stock of the Company as shall equal the result
obtained by (I) multiplying the then-current Purchase Price by the
number of shares of Common Stock for which such Right was exercisable
immediately prior to the first occurrence of such Section 11(a)(ii)
Event, whether or not such Right was then exercisable, and (II)
dividing that product (which, following such first occurrence, shall
thereafter be referred to as the
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"Purchase Price" for each Right and for all purposes of this Agreement)
by fifty percent (50%) of the Current Market Price per share of Common
Stock of the Company on the date of such first occurrence. The shares
of Common Stock to be issued in the number thus determined are referred
to herein as the "Adjustment Shares".
(iii) In lieu of issuing Common Stock of the Company in
accordance with Section 11(a)(ii) hereof, the Company, acting by
resolution of the Board (which resolution shall be effective only with
the concurrence of a majority of the Continuing Directors), may and, in
the event that the number of shares of Common Stock of the Company
which are authorized by the Company's Articles of Organization (as the
same may be amended and restated from time to time) but not outstanding
or reserved for issuance for purposes other than upon exercise of the
Rights is not sufficient to permit the exercise in full of the Rights
in accordance with the foregoing subparagraph (ii) of this Section
11(a), shall (A) determine the excess of (1) the value of the
Adjustment Shares issuable upon the exercise of a Right (the "Current
Value") over (2) the Purchase Price attributable to each Right (such
excess being referred to as the "Spread"), and (B) with respect to each
Right (subject to Section 7(e) hereof), make adequate provision to
substitute for the Adjustment Shares, upon payment of the applicable
Purchase Price, (1) cash, (2) a reduction in the Purchase Price, (3)
equity securities of the Company other than Common Stock of the Company
(including, without limitation, shares, or units of shares, of
preferred stock which the Board has deemed to have the same value as
shares of Common Stock (such shares of preferred stock being referred
to as "Common Stock Equivalents")), (4) debt securities of the Company,
(5) other assets or (6) any combination of the foregoing which, when
added to any shares of Common Stock issued upon such exercise, have an
aggregate value equal to the Current Value, where such aggregate value
has been determined by the Board (with the concurrence of a majority of
the Continuing Directors) based upon the advice of an investment
banking firm selected by the Board; provided, however, that if the
Company shall not have made adequate provision to deliver value
pursuant to clause (B) above within thirty (30) days following the
later of (x) the first occurrence of a Section 11(a)(ii) Event and (y)
the date on which the Company's right of redemption pursuant to Section
23(a) hereof, as such date may be amended pursuant to Section 26
hereof, expires (the later of (x) and (y) being referred to herein as
the "Section 11(a)(ii) Trigger Date"), then the Company shall be
obligated to deliver, upon the surrender for exercise of a Right and
without requiring payment of the Purchase Price, shares of Common Stock
of the Company (to the extent available) and then, if necessary, cash,
which shares and/or cash have an aggregate value equal to the Spread.
If the Board (with the concurrence of a majority of the Continuing
Directors) shall determine in good faith that it is likely that
sufficient additional shares of Common Stock of the Company could be
authorized for issuance upon exercise in full of the Rights, the thirty
(30) day period set forth above may be extended to the extent
necessary, but not more than ninety (90) days after the Section
11(a)(ii) Trigger Date, in order that the Company may seek shareholder
approval for the authorization of such additional shares (such period,
as it may be extended being referred to herein as the "Substitution
Period"). To the extent that the Company determines that some action
need be taken pursuant to the first and/or second sentences of this
Section 11(a)(iii), the Company (x) shall provide, subject to Section
7(e) hereof, that such action shall apply uniformly to all outstanding
Rights and (y) may suspend the exercisability of the Rights until the
expiration of the Substitution Period in order to seek any
authorization of additional
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shares and/or to decide the appropriate form of distribution to be made
pursuant to such first sentence and to determine the value thereof. In
the event of any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been
temporarily suspended, as well as a public announcement at such time as
the suspension is no longer in effect. For purposes of this Section
11(a)(iii), the value of the Common Stock of the Company shall be the
Current Market Price per share of the Common Stock of the Company on
the Section 11(a)(ii) Trigger Date and the value of any Common Stock
Equivalent shall be deemed to have the same value as the Common Stock
of the Company on such date.
(b) In case the Company shall fix a record date for the issuance of
rights, options or warrants to all holders of Common Stock entitling them to
subscribe for or purchase (for a period expiring within forty-five (45) calendar
days after such record date) Common Stock or securities convertible into Common
Stock at a price per share of Common Stock (or having a conversion price per
share of Common Stock, if a security convertible into Common Stock) less than
the Current Market Price per share of Common Stock on such record date, the
Purchase Price to be in effect after such record date shall be determined by
multiplying the Purchase Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be the number of shares of Common
Stock outstanding on such record date plus the number of shares of Common Stock
which could be purchased at such Current Market Price using the aggregate
subscription or purchase price of the total number of shares of Common Stock so
to be offered (and/or the aggregate initial conversion price of the convertible
securities so to be offered) and the denominator of which shall be the number of
shares of Common Stock outstanding on such record date plus the number of
additional shares of Common Stock to be offered for subscription or purchase (or
into which the convertible securities so to be offered are initially
convertible). In case such subscription price may be paid by delivery of
consideration part or all of which may be in a form other than cash, the value
of such consideration shall be as determined in good faith by the Board (with
the concurrence of a majority of the Continuing Directors), whose determination
shall be described in a statement filed with the Rights Agent and shall be
conclusive for all purposes. Shares of Common Stock owned by or held for the
account of the Company shall not be deemed outstanding for the purpose of any
such computation. Such adjustment shall be made successively whenever such a
record date is fixed, and in the event that such rights, options or warrants are
not so issued, the Purchase Price shall be adjusted to be the Purchase Price
which would then be in effect if such record date had not been fixed.
(c) In case the Company shall fix a record date for a distribution to
all holders of Common Stock (including any such distribution made in connection
with a consolidation or merger in which the Company is the continuing or
surviving corporation) of evidences of indebtedness, cash (other than a regular
periodic cash dividend out of the earnings or retained earnings of the Company),
assets (other than a dividend payable in Common Stock, but including any
dividend payable in stock other than Common Stock) or subscription rights or
warrants (excluding those referred to in Section 11(b) hereof), the Purchase
Price to be in effect after such record date shall be determined by multiplying
the Purchase Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the Current Market Price per share of
Common Stock on such record date minus the fair market value (as determined in
good faith by the Board (with the concurrence of a majority of the Continuing
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Directors), whose determination shall be described in a statement filed with the
Rights Agent and shall be binding upon the Rights Agent and the holders of the
Rights) of the portion of the cash, assets or evidences of indebtedness so to be
distributed or of such subscription rights or warrants applicable to a share of
Common Stock, and the denominator of which shall be such Current Market Price
per share of Common Stock. Such adjustments shall be made successively whenever
such a record date is fixed, and in the event that such distribution is not so
made, the Purchase Price shall be adjusted to be the Purchase Price which would
have been in effect if such record date had not been fixed.
(d) For the purpose of any computation hereunder, other than
computations made pursuant to Section 11(a)(iii) hereof, the Current Market
Price per share of Common Stock of the Company on any date shall be deemed to be
the average of the daily closing prices per share of such Common Stock for the
thirty (30) consecutive Trading Days immediately prior to such date, and for
purposes of computations made pursuant to Section 11(a)(iii) hereof, the Current
Market Price per share of Common Stock on any date shall be deemed to be the
average of the daily closing prices per share of such Common Stock for the ten
(10) consecutive Trading Days immediately following such date; provided,
however, that in the event that the Current Market Price per share of the Common
Stock is determined during a period following the announcement by the Company of
(A) a dividend or distribution on such Common Stock payable in shares of such
Common Stock or securities convertible into shares of such Common Stock (other
than the Rights) or (B) any subdivision, combination, consolidation, reverse
stock split or reclassification of such Common Stock, and prior to the
expiration of the requisite thirty (30) Trading Day or ten (10) Trading Day
period, as set forth above, after the ex-dividend date for such dividend or
distribution, or the record date for such subdivision, combination,
consolidation, reverse stock split or reclassification, then, in each such case,
the Current Market Price shall be properly adjusted to take into account ex-
dividend trading. The closing price for each day shall be the last sale price,
regular way, or in case no such sale takes place on such day, the average of the
closing bid and asked prices, regular way, in either case as reported in the
principal consolidated transaction reporting system with respect to securities
listed or admitted to trading on the New York Stock Exchange, or if the shares
of Common Stock are not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the shares of Common Stock are listed or admitted to trading, or if the
shares of Common Stock are 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 National Market or the Nasdaq Stock Market or such other quotation
system then in use, or, if on any such date the shares of Common Stock are not
quoted by any such organization, the average of the closing bid and asked prices
as furnished by a professional market maker making a market in the Common Stock
selected by the Board (with the concurrence of a majority of the Continuing
Directors). If the Common Stock is not publicly held or not so listed, traded or
quoted and no market maker is making a market, Current Market Price per share of
Common Stock shall mean the fair value per share as determined in good faith by
the Board (with the concurrence of a majority of the Continuing Directors),
whose determination shall be described in a statement filed with the Rights
Agent and shall be conclusive for all purposes.
(e) Anything herein to the contrary notwithstanding, no adjustment in
the Purchase Price shall be required unless such adjustment would require an
increase or decrease of at least one percent (1%) in the Purchase Price;
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provided, however, that any adjustments which by reason of this Section 11(e)
are not required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Section 11 shall be made
to the nearest cent or to the nearest one-hundredth of a share of Common Stock
or other share. Notwithstanding the first sentence of this Section 11(e), any
adjustment required by this Section 11 shall be made no later than the earlier
of (i) three (3) years from the date of the transaction which mandates such
adjustment and (ii) the Expiration Date.
(f) If as a result of an adjustment made pursuant to Section 11(a)(ii)
or Section 13(a) hereof, the holder of any Right thereafter exercised shall
become entitled to receive any shares of capital stock other than Common Stock,
thereafter the number of such other shares so receivable upon exercise of any
Right and the Purchase Price thereof (or the number of Rights) shall be subject
to adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to shares of Common Stock contained
in Sections 11(a), (b), (c), (e), (g), (h), (i), (j), (k) and (m), and the
provisions of Sections 7, 9, 10, 13 and 14 hereof with respect to the shares of
Common Stock shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of shares of Common Stock
purchasable from time to time hereunder upon exercise of the Rights, all subject
to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as provided in
Section 11(i), upon each adjustment of the Purchase Price as a result of the
calculations made in Sections 11(b) and (c), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of shares of Common Stock
(calculated to the nearest one one-hundredth of a share) obtained by (i)
multiplying (x) the number of shares of Common Stock covered by a Right
immediately prior to this adjustment, by (y) the Purchase Price in effect
immediately prior to such adjustment of the Purchase Price, and (ii) dividing
the product so obtained by the Purchase Price in effect immediately after such
adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any adjustment of the
Purchase Price to adjust the number of Rights, in lieu of any adjustment in the
number of shares of Common Stock purchasable upon the exercise of a Right. Each
of the Rights outstanding after such adjustment in the number of Rights shall be
exercisable for the number of shares of Common Stock for which each respective
Right was exercisable immediately prior to such adjustment. Each Right held of
record prior to such adjustment of the number of Rights shall become that number
of Rights (calculated to the nearest one one-hundredth) obtained by dividing the
Purchase Price in effect immediately prior to adjustment of the Purchase Price
by the Purchase Price in effect immediately after adjustment of the Purchase
Price. The Company shall make a public announcement of its election to adjust
the number of Rights, indicating the record date for the adjustment, and, if
known at the time, the amount of the adjustment to be made. This record date may
be the date on which the Purchase Price is adjusted or any day thereafter, but,
if the Rights Certificates have been issued, shall be at least ten (10) days
later than the date of the public announcement. If Rights Certificates have been
issued, upon each adjustment of the number of Rights pursuant to this Section
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11(i), the Company shall, as promptly as practicable, cause to be distributed to
holders of record of Rights Certificates on such record date Rights Certificates
evidencing, subject to Section 14 hereof, the additional Rights to which such
holders shall be entitled as a result of such adjustment, or, at the option of
the Company, shall cause to be distributed to such holders of record in
substitution and replacement for the Rights Certificates held by such holders
prior to the date of adjustment, and upon surrender thereof, if required by the
Company, new Rights Certificates evidencing all the Rights to which such holders
shall be entitled after such adjustment. Rights Certificates so to be
distributed shall be issued, executed and countersigned in the manner provided
for herein (and may bear, at the option of the Company, the adjusted Purchase
Price) and shall be registered in the names of the holders of record of Rights
Certificates on the record date specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase Price or
the number of shares of Common Stock issuable upon the exercise of the Rights,
the Rights Certificates theretofore and thereafter issued may continue to
express the Purchase Price per share and the number of shares which were
expressed in the initial Rights Certificates issued hereunder.
(k) Before taking any action that would cause an adjustment reducing
the Purchase Price below the then-stated value, if any, of the number of shares
of Common Stock issuable upon exercise of the Rights, 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
such number of fully paid and nonassessable shares of Common Stock at such
adjusted Purchase Price; provided, however, that in no event shall the Company
be liable for its inability to reserve and keep available for issuance upon
exercise of the Rights pursuant to Section 11(a)(ii) a number of shares of
capital stock of the Company greater than the number then authorized by the
Company's Articles of Organization (as the same may be amended or restated from
time to time) but not outstanding or reserved for any other purpose..
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuance to the holder of any Right exercised after such record date
of the number of shares of Common Stock and other capital stock or securities of
the Company, if any, issuable upon such exercise over and above the number of
shares of Common Stock and other capital stock or securities of the Company, if
any, issuable upon such exercise on the basis of the Purchase Price in effect
prior to such adjustment; provided, however, that the Company shall deliver to
such holder a due ▇▇▇▇ or other appropriate instrument evidencing such holder's
right to receive such additional shares (fractional or otherwise) or securities
upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such adjustments in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that in its good faith judgment the Board shall determine to be
advisable in order that any (i) consolidation or subdivision of the Common
Stock, (ii) issuance wholly for cash of any shares of Common Stock at less than
the Current Market Price thereof, (iii) issuance wholly for cash of shares of
Common Stock or securities which by their terms are convertible into or
exchangeable for shares of Common Stock, (iv) stock dividends or (v)
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issuance of rights, options or warrants referred to in this Section 11,
hereafter made by the Company to holders of its Common Stock shall not be
taxable to such shareholders.
(n) The Company covenants and agrees that it shall not, at any time
after the Distribution Date, (i) consolidate with any other Person (other than a
Subsidiary of the Company in a transaction which complies with Section 11(o)
hereof), (ii) merge with or into any other Person (other than a Subsidiary of
the Company in a transaction which complies with Section 11(o) hereof) or (iii)
sell or transfer (or permit any Subsidiary to sell or transfer), in one
transaction, or a series of related transactions, assets or earning power
aggregating more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person or Persons (other than the
Company and/or any of its Subsidiaries in one or more transactions each of which
complies with Section 11(o) hereof), if (x) at the time of or immediately after
such consolidation, merger, sale or transfer there are any rights, warrants or
other instruments or securities outstanding or agreements in effect which would
substantially diminish or otherwise eliminate the benefits intended to be
afforded by the Rights or (y) prior to, simultaneously with or immediately after
such consolidation, merger, sale or transfer, the stockholders of the Person who
constitutes, or would constitute, the "Principal Party" for purposes of Section
13(a) hereof shall have received a distribution of Rights previously owned by
such Person or any of its Affiliates and Associates.
(o) The Company covenants and agrees that, after the Distribution Date,
it will not, except as permitted by Section 23, Section 26, Section 29 or
Section 31 hereof, take (or permit any Subsidiary to take) any action if at the
time such action is taken it is reasonably foreseeable that such action will
diminish substantially or otherwise eliminate the benefits intended to be
afforded by the Rights.
(p) Anything in this Agreement to the contrary notwithstanding, in the
event that the Company shall at any time after the Rights Dividend Declaration
Date and prior to the Distribution Date (i) declare a dividend on the
outstanding shares of Common Stock of the Company payable in shares of Common
Stock of the Company, (ii) subdivide the outstanding shares of Common Stock of
the Company in a manner not covered in (i) above or (iii) combine the
outstanding shares of Common Stock of the Company into a smaller number of
shares, (x) the number of shares of Common Stock then purchasable upon exercise
of a Right shall be proportionately adjusted so that the number of shares of
Common Stock purchasable thereafter upon proper exercise of each Right shall
equal the result obtained by multiplying the number of shares of Common Stock so
purchasable immediately prior to such event by a fraction the numerator of which
shall be the total number of shares of Common Stock of the Company outstanding
immediately prior to the occurrence of the event and the denominator of which
shall be the total number of shares of Common Stock of the Company outstanding
immediately following the occurrence of such event and (y) action shall be taken
such that each share of Common Stock of the Company outstanding immediately
after such event shall have issued with respect to it that number of Rights
which each share of Common Stock of the Company outstanding immediately prior to
such event had issued with respect to it. The adjustments provided for in this
Section 11(p) shall be made successively whenever such a dividend is declared or
paid or such a subdivision, combination or consolidation is effected. If an
event occurs which would require an adjustment under Section 11(a)(ii) and this
Section 11(p), the adjustments provided for in this Section 11(p) shall be in
addition and prior to any adjustment required pursuant to Section 11(a)(ii).
-21-
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Section 11 and Section 13 hereof,
the Company shall (a) promptly prepare a certificate setting forth such
adjustment and a brief statement of the facts accounting for such adjustment,
(b) promptly file with the Rights Agent, and with each transfer agent for the
Common Stock of the Company, a copy of such certificate and (c) mail a brief
summary thereof to each holder of a Rights Certificate (or if prior to the
Distribution Date, to each holder of a certificate representing shares of Common
Stock of the Company) in accordance with Section 25 hereof. Notwithstanding the
foregoing sentence, the failure of the Company to prepare such certificate or
statement or make such filings or mailings shall not affect the validity of, or
the force or effect of, the requirement for such adjustment. The Rights Agent
shall be fully protected in relying on any such certificate and on any
adjustment therein contained, and shall not be deemed to have knowledge of any
such adjustment unless and until it shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earning Power.
(a) In the event (a "Section 13 Event") that, on or after the Stock
Acquisition Date, directly or indirectly, (x) the Company shall consolidate or
otherwise combine with, or merge with or into, any other Person or Persons
(other than a Subsidiary of the Company in a transaction which complies with
Section 11(o) hereof), and the Company shall not be the continuing or surviving
corporation of such consolidation, combination or merger, (y) any Person or
Persons (other than a Subsidiary of the Company in a transaction which complies
with Section 11(o) hereof) shall consolidate or combine with, or merge with or
into, the Company, and the Company shall be the continuing or surviving
corporation of such consolidation, combination or merger and, in connection with
such consolidation, combination or merger, all or part of the outstanding shares
of Common Stock of the Company shall be changed into or exchanged for stock or
other securities of any other Person or Persons or cash or any other property or
(z) the Company shall sell or otherwise transfer (or one or more of its
Subsidiaries shall sell or otherwise transfer), in one transaction or a series
of related transactions, assets or earning power aggregating more than 50% of
the assets or earning power of the Company and its Subsidiaries (taken as a
whole and calculated on the basis of the Company's most recent regularly
prepared financial statements) to any Person or Persons (other than the Company
or any Subsidiary of the Company in one or more transactions each of which
complies with Section 11(o) hereof); provided, however, that this clause (z) of
Section 13(a) shall not apply to the pro rata distribution by the Company of
assets (including securities) of the Company or any of its Subsidiaries to all
holders of the Company's Common Stock; then, and in each such case (except as
may be contemplated by Section 13(d) hereof), proper provision shall be made so
that: (i) each holder of a Right, except as provided in Section 7(e) hereof,
shall, on or after the later of (A) the date of the first occurrence of any such
Section 13 Event and (B) the date of the expiration of the period within which
the Rights may be redeemed pursuant to Section 23 hereof (as the same may be
amended or reinstated as provided in Section 26 or Section 31 hereof,
respectively), have the right to receive, upon the exercise thereof at the
then-current Purchase Price in accordance with the terms of this Agreement, such
number of validly authorized and issued, fully paid, nonassessable and freely
tradeable shares of Common Stock of the Principal Party, not subject to any
liens, encumbrances, rights of first refusal or other adverse claims, as shall
be equal to the result obtained by (1) multiplying the then-current Purchase
Price by the number of shares of Common Stock for which a Right was exercisable
immediately prior to the first occurrence of a Section 13 Event (or, if a
Section 11(a)(ii) Event has occurred prior to the first occurrence of a Section
-22-
13 Event, multiplying the number of such shares for which a Right was
exercisable immediately prior to the first occurrence of a Section 11(a)(ii)
Event by the Purchase Price in effect immediately prior to such first
occurrence), and (2) dividing that product (which, following the first
occurrence of a Section 13 Event, shall be referred to as the "Purchase Price"
for each Right and for all purposes of this Agreement) by 50% of the Current
Market Price per share of the Common Stock of such Principal Party on the date
of consummation of such Section 13 Event; (ii) such Principal Party shall
thereafter be liable for, and shall assume, by virtue of such Section 13 Event,
all the obligations and duties of the Company pursuant to this Agreement; (iii)
the term "Company" shall thereafter be deemed to refer to such Principal Party,
it being specifically intended that the provisions of Section 11 hereof shall
apply to such Principal Party only following the first occurrence of a Section
13 Event; (iv) such Principal Party shall take such steps (including, but not
limited to, the reservation of a sufficient number of shares of its Common
Stock) in connection with the consummation of any such transaction as may be
necessary to assure that the provisions hereof shall thereafter be applicable,
as nearly as reasonably may be, in relation to its shares of Common Stock
thereafter deliverable upon the exercise of the Rights; and (v) the provisions
of Section 11(a)(ii) hereof shall be of no effect following the first occurrence
of any Section 13 Event.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in clauses (x) or
(y) of the first sentence of Section 13(a) hereof, (A) the Person that
is the issuer of any securities into which shares of Common Stock of
the Company are converted, changed or exchanged in such merger,
consolidation or combination or, if there is more than one such issuer,
the issuer the Common Stock of which has the greatest aggregate market
value or (B) if no securities are so issued, the Person that is the
other party to such merger (and survives the merger), consolidation or
combination (or if there is more than one such Person, the Person the
Common Stock of which has the greatest aggregate market value), or if
the other party to the merger does not survive the merger, the Person
that does survive the merger (including the Company if it survives);
and
(ii) in the case of any transaction described in clause (z) of
the first sentence of Section 13(a), 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 the
Common Stock having the greatest aggregate market value; provided,
however, that in any such case, (1) if the Common Stock of such Person
is not at such time and has not been continuously over the preceding
12-month period registered under Section 12 of the Exchange Act and
such Person is a direct or indirect Subsidiary of another Person the
Common Stock of which is and has been so registered, "Principal Party"
shall refer to such other Person; (2) if the Common Stock of such
Person is not and has not been so registered and such Person is a
Subsidiary, directly or indirectly, of more than one Person, the Common
Stocks of two or more of which are and have been so registered,
"Principal Party" shall refer to whichever of such Persons is the
issuer of the Common Stock having the greatest aggregate market value;
and (3) if the Common Stock of such Person is not and has not been
-23-
so registered and such Person is owned, directly or indirectly, by a
joint venture formed by two or more Persons that are not owned,
directly or indirectly, by the same Person, the rules set forth in (1)
and (2) above shall apply to each of the chains of ownership having an
interest in such joint venture as if such party were a Subsidiary of
both or all of such joint venturers and the Principal Parties in each
such chain shall bear the obligations set forth in this Section 13 in
the same ratio as their direct or indirect interests in such Person
bear to the total of such interests.
(c) The Company shall not consummate any transaction constituting or
involving a Section 13 Event unless the Principal Party shall have a sufficient
number of authorized shares of its Common Stock which have not been issued or
reserved for issuance for other purposes to permit the exercise in full of the
Rights in accordance with this Section 13 and unless prior thereto the Company
and such Principal Party shall have executed and delivered to the Rights Agent a
supplemental agreement confirming that the requirements of Sections 13(a) and
(b) hereof shall promptly be performed in accordance with their terms and that
such Section 13 Event shall not result in a default by the Principal Party under
this Agreement as the same shall have been assumed by the Principal Party
pursuant to Sections 13(a) and (b) hereof and further providing that, as soon as
practicable after the date of such Section 13 Event, the Principal Party will:
(i) prepare and file a registration statement under the Act
with respect to the Rights and the securities purchasable upon exercise
of the Rights on an appropriate form and will use its best efforts to
cause such registration statement to (A) become effective as soon as
practicable after such filing and (B) remain effective (with a
prospectus at all times meeting the requirements of the Act) until the
Expiration Date and to similarly comply with applicable state
securities laws;
(ii) use its best efforts to list or obtain quotation of (or
continue the listing or quotation of) the Rights and the securities
purchasable upon exercise of the Rights on a national securities
exchange or automated quotation service;
(iii) deliver to holders of the Rights historical financial
statements for the Principal Party and each of its Affiliates which
comply in all respects with the requirements for registration on Form
10 (or any successor form) under the Exchange Act; and
(iv) use its best efforts to obtain waivers of any rights of
first refusal or preemptive rights in respect of the shares of Common
Stock of the Principal Party subject to purchase upon exercise of
outstanding Rights.
The provisions of this Section 13 shall similarly apply to successive
mergers or consolidations or sales or other transfers. In the event that a
Section 13 Event shall occur at any time after the occurrence of a Section
11(a)(ii) Event, the Rights which have not theretofore been exercised shall
thereafter become exercisable in the manner described in Section 13(a).
(d) Notwithstanding anything in this Agreement to the contrary, Section
13 shall not be applicable to a transaction described in clauses (x) or (y) of
the first sentence of Section 13(a) if (i) such transaction is consummated with
-24-
a Person or Persons (or a wholly owned subsidiary of any such Person or Persons)
who acquired shares of Common Stock of the Company pursuant to a tender offer or
exchange offer for all outstanding shares of Common Stock of the Company which
complies with the exception provided for in Section 11(a)(ii) hereof, (ii) the
price per share of Common Stock of the Company offered in such transaction is
not less than the price per share of Common Stock paid to all holders of shares
of Common Stock of the Company whose shares were purchased pursuant to such
tender offer or exchange offer and (iii) the form of consideration being offered
to the remaining holders of shares of Common Stock pursuant to such transaction
is the same as the form of consideration paid pursuant to such tender offer or
exchange offer. Upon consummation of any such transaction contemplated by this
Section 13(d), all Rights hereunder shall expire.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue fractions of Rights,
except prior to the Distribution Date as provided in Section 11(i) hereof, or to
distribute Rights Certificates which evidence fractional Rights. In lieu of such
fractional Rights, there shall be paid to the registered holders of the Rights
Certificates with regard to which such fractional Rights would otherwise be
issuable, an amount in cash equal to the same fraction of the current market
value of a whole Right. For purposes of this Section 14(a), the current market
value of a whole Right shall be the closing price of the Rights for the Trading
Day immediately prior to the date on which such fractional Rights would have
been otherwise issuable. The closing price of the Rights for any day shall be
the last sale price, regular way, or, in case no such sale takes place on such
day, the average of the closing bid and asked prices, regular way, in either
case as reported in the principal consolidated transaction reporting system with
respect to securities listed or admitted to trading on the New York Stock
Exchange or, if the Rights are not listed or admitted to trading on the New York
Stock Exchange, as reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal national securities
exchange on which the Rights are listed or admitted to trading, or if the Rights
are not listed or admitted to trading on any national securities exchange, 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 National
Market or the Nasdaq Stock Market or such other system then in use or, if on any
such date the Rights are not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market maker making
a market in the Rights selected by the Board (with the concurrence of a majority
of the Continuing Directors). If on any such date no such market maker is making
a market in the Rights, the fair value of the Rights on such date as determined
in good faith by the Board (with the concurrence of a majority of the Continuing
Directors) shall be used.
(b) The Company shall not be required to issue fractions of shares of
Common Stock of the Company upon exercise of the Rights or to distribute
certificates which evidence fractional shares of Common Stock of the Company. In
lieu of fractional shares of Common Stock, the Company may pay to the registered
holders of Rights Certificates at the time such Rights are exercised as herein
provided an amount in cash equal to the same fraction of the current market
value of one (1) share of Common Stock of the Company. For purposes of this
Section 14(b), the current market value of one share of Common Stock shall be
the closing price of a share of Common Stock or, if unavailable, the appropriate
alternative price (in each case as determined pursuant to Section 11(d) hereof)
for the Trading Day immediately prior to the date of such exercise.
-25-
(c) The holder of a Right by the acceptance of the Rights expressly
waives his right to receive any fractional Rights or any fractional shares upon
exercise of a Right, except as permitted by this Section 14.
Section 15. Rights of Action; Specific Enforcement and Injunctive
Relief. All rights of action in respect of this Agreement, except the rights of
action vested in the Rights Agent pursuant to Section 18 hereof, are vested in
the respective registered holders of the Rights Certificates (and, prior to the
Distribution Date, the registered holders of the Common Stock of the Company);
and any registered holder of any Rights Certificate (or, prior to the
Distribution Date, of the Common Stock of the Company), without the consent of
the Rights Agent or of the holder of any other Rights Certificate (or, prior to
the Distribution Date, of the Common Stock of the Company), may, in his own
behalf and for his own benefit, enforce, and may institute and maintain any
suit, action or proceeding against the Company to enforce, or otherwise act in
respect of, his right to exercise the Rights evidenced by such Rights
Certificate in the manner provided in such Rights Certificate and in this
Agreement. Without limiting the foregoing or any remedies available to the
holders of Rights, it is specifically acknowledged that the holders of Rights
would not have an adequate remedy at law for any breach of this Agreement and
shall be entitled to specific performance of the obligations hereunder and
injunctive relief against actual or threatened violations of the obligations
hereunder of any Person subject to this Agreement.
Section 16. Agreement of Rights Holders. Every holder of a Right by
accepting the 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 transferable
only in connection with the transfer of Common Stock of the Company;
(b) after the Distribution Date, the Rights Certificates shall be
transferable only on the registry books of the Rights Agent if surrendered at
the principal office or offices of the Rights Agent designated for such
purposes, duly endorsed or accompanied by a proper instrument of transfer and
with the appropriate forms and certificates fully executed;
(c) subject to Section 6(a) and Section 7(f) hereof, the Company and
the Rights Agent shall be entitled to deem and treat the person in whose name a
Rights 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
Rights Certificates or the associated Common Stock certificate made by anyone
other than the Company or the Rights Agent) for all purposes whatsoever, and
neither the Company nor the Rights Agent, subject to the last sentence of
Section 7(e) hereof, shall be required to be affected by any notice to the
contrary; and
(d) notwithstanding anything in this Agreement to the contrary, neither
the Company nor the Rights Agent shall have any liability to any holder of a
Right or other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
-26-
commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, the Company must use its best
efforts to have any such order, decree or ruling lifted or otherwise overturned
as soon as possible.
Section 17. Rights Certificate Holder Not Deemed a Shareholder. No
holder, as such, of any Rights Certificate shall be entitled to vote, receive
dividends or be deemed for any purpose the holder of the number of shares of
Common Stock or any other securities of the Company which may at any time be
issuable on the exercise of the Rights represented thereby, nor shall anything
contained herein or in any Rights Certificate be construed to confer upon the
holder of any Rights Certificate, as such, any of the rights of a shareholder of
the Company or any right to vote for the election of directors or upon any
matter submitted to shareholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings or other
actions affecting shareholders (except as provided in Section 24 hereof), or to
receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Rights Certificate shall have been exercised in
accordance with the provisions hereof.
Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from time to time,
on demand of the Rights Agent, its reasonable expenses and counsel fees and
disbursements and other disbursements incurred in the administration and
execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent for, and to
hold it harmless against, any loss, liability, or expense, incurred without
negligence, bad faith or willful misconduct on the part of the Rights Agent, for
anything done or omitted by the Rights Agent in connection with the acceptance
and administration of this Agreement, including the costs and expenses of
defending against any claim of liability in the premises.
(b) The Rights Agent shall be protected and shall incur no liability
for or in respect of any action taken, suffered or omitted by it in connection
with its administration of this Agreement in reliance upon any Rights
Certificate or certificate for Common Stock or for other securities of the
Company, instrument of assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, direction, consent, certificate, statement or other
paper or document reasonably believed by it to be genuine and to be signed,
executed and, where necessary, verified or acknowledged by the proper Person or
Persons.
Section 19. Merger or Consolidation or Change of Name of Rights Agent.
(a) Any corporation into which the Rights Agent or any successor Rights
Agent shall be merged or with which it shall be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any corporation succeeding to the
corporate trust or stock transfer business of the Rights Agent or any successor
Rights Agent, shall be the successor to the Rights Agent under this Agreement
without the execution or filing of any paper or any further act on the part of
any of the parties hereto; provided, however, that such corporation would be
-27-
eligible for appointment as a successor Rights Agent under the provisions of
Section 21 hereof. If at the time such successor Rights Agent shall succeed to
the agency created by this Agreement, any of the Rights Certificates shall have
been countersigned but not delivered, any such successor Rights Agent may adopt
the countersignature of a predecessor Rights Agent and deliver such Rights
Certificates so countersigned, and if at that time any of the Rights
Certificates shall not have been countersigned, any successor Rights Agent may
countersign such Rights Certificates either in the name of the predecessor or in
the name of the successor Rights Agent; and in all such cases, such Rights
Certificates shall have the full force provided in the Rights Certificates and
in this Agreement.
(b) If at any time the name of the Rights Agent shall be changed and at
such time any of the Rights Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the countersignature under its prior name
and deliver Rights Certificates so countersigned; and in case at that time any
of the Rights Certificates shall not have been countersigned, the Rights Agent
may countersign such Rights Certificates either in its prior name or in its
changed name; and in all such cases, such Rights Certificates shall have the
full force provided in the Rights Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes the
duties and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the holders of Rights Certificates,
by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may be legal
counsel for the Company), and the opinion of such counsel shall be full and
complete authorization and protection to the Rights Agent as to any action taken
or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement the
Rights Agent shall deem it necessary or desirable that any fact or matter
(including, without limitation, the identity of any Acquiring Person and the
determination of the Current Market Price) be proved or established by the
Company prior to taking or suffering any action hereunder, such fact or matter
(unless other evidence in respect thereof be herein specifically prescribed) may
be deemed to be conclusively proved and established by a certificate signed by
the Chairman of the Board, the President, any Vice President, the Treasurer or
any Assistant Treasurer of the Company and delivered to the Rights Agent; and
such certificate shall be full authorization to the Rights Agent for any action
taken or suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(c) The Rights Agent shall not be liable hereunder except 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 Agreement or in the Rights
Certificates, nor shall it be required to verify the same (except as to its
countersignature on such Rights Certificates), but all such statements and
recitals are and shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in respect
of the validity of this Agreement or the execution and delivery hereof (except
the due execution hereof by the Rights Agent) or in respect of the validity or
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execution of any Rights Certificate (except its countersignature thereon); nor
shall it be responsible for any breach by the Company of any covenant or
condition contained in this Agreement or in any Rights Certificate; nor shall it
be responsible for any adjustment required under the provisions of Section 11 or
Section 13 hereof or responsible for the manner, method or amount of any such
adjustment or the ascertaining of the existence of facts that would require any
such adjustment (except with respect to the exercise of Rights evidenced by
Rights Certificates after receipt of a certificate furnished pursuant to Section
12, describing such adjustment); nor shall it by any act hereunder be deemed to
make any representation or warranty as to the authorization or reservation of
any shares of Common Stock to be issued pursuant to this Agreement or any Rights
Certificate or as to whether any shares of Common Stock will, when so issued, be
validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may reasonably be required
by the Rights Agent for the carrying out or performing by the Rights Agent of
the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from the
Chairman of the Board, the President, any Vice President, the Treasurer or any
Assistant Treasurer of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable for any
action taken or suffered to be taken by it in good faith in accordance with
instructions of any such officer, or any delay in acting while waiting for such
instructions. Any application by the Rights Agent for written instructions from
the Company may, at the option of the Rights Agent, set forth in writing any
action proposed to be taken or omitted by the Rights Agent under this Rights
Agreement and the date on and/or after which such action shall be taken or such
omission shall be effective. The Rights Agent shall not be liable for any action
taken by, or omission of, the Rights Agent in accordance with a proposal
included in any such application on or after the date specified in such
application (which date shall not be less than five Business Days after the date
any officer of the Company actually receives such application, unless any such
officer shall have consented in writing to an earlier date) unless, prior to
taking any such action (or the effective date in the case of an omission), the
Rights Agent shall have received written instructions in response to such
application specifying the action to be taken or omitted.
(h) The Rights Agent and any stockholder, director, officer or employee
of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though it were not Rights Agent
under this Agreement. Nothing herein shall preclude the Rights Agent from acting
in any other capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself or by or
through its attorneys or agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such act, default,
neglect or misconduct; provided, however, reasonable care was exercised in the
selection and continued employment thereof.
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(j) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if
there shall be reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not reasonably
assured to it.
(k) If, with respect to any Rights Certificate surrendered to the
Rights Agent for exercise or transfer, the certificate attached to the form of
assignment or form of election to purchase, as the case may be, has either not
been completed or indicates an affirmative response to clause 1 and/or 2
thereof, the Rights Agent shall not take any further action with respect to such
requested exercise or transfer without first consulting with the Company.
Section 21. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Agreement
upon thirty (30) days' notice in writing mailed to the Company, and to each
transfer agent of the Common Stock, by registered or certified mail, and to the
holders of the Rights Certificates by first-class mail. The Company may remove
the Rights Agent or any successor Rights Agent upon thirty (30) days' notice in
writing, mailed to the Rights Agent or successor Rights Agent, as the case may
be, and to each transfer agent of the Common Stock, by registered or certified
mail, and to the holders of the Rights Certificates by first-class mail. If the
Rights Agent shall resign or be removed or shall otherwise become incapable of
acting, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of thirty (30) days
after giving notice of such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Rights Agent or
by the holder of a Rights Certificate (who shall, with such notice, submit his
Rights Certificate for inspection by the Company), then any registered holder of
any Rights Certificate may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. If no successor Rights Agent shall have been
appointed within thirty (30) days from effectiveness of such removal or
resignation, and no registered holder of any Rights Certificates have applied
pursuant to this Agreement for the appointment of a new Rights Agent, the
Company shall be automatically designated as successor 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 of the United States so long as such corporation
is authorized to do business as a banking institution in such state, is in good
standing, is authorized under such laws to exercise corporate trust powers, is
subject to supervision or examination by federal or state authority and has at
the time of its appointment as Rights Agent a combined capital and surplus of at
least $100,000,000 or (b) an Affiliate of a corporation described in clause (a)
of this sentence. After appointment, the successor Rights Agent shall be vested
with the same powers, rights, duties and responsibilities as if it had been
originally named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the successor Rights
Agent any property at the time held by it hereunder and shall execute and
deliver 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 shall mail a notice thereof in writing to
the registered holders of the Rights Certificates. Failure to give any notice
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provided for in this Section 21, however, or any defect therein, shall not
affect the legality or validity of the resignation or removal of the Rights
Agent or the appointment of the successor Rights Agent, as the case may be.
Section 22. Issuance of New Rights Certificates. Notwithstanding any of
the provisions of this Agreement or of the Rights Certificates to the contrary,
the Company may, at its option, issue new Rights Certificates evidencing Rights
in such form as may be approved by the Board to reflect any adjustment or change
in the Purchase Price and the number or kind or class of shares or other
securities or property purchasable under the Rights Certificates made in
accordance with the provisions of this Agreement. In addition, in connection
with the issuance or sale of shares of Common Stock of the Company following the
Distribution Date and prior to the redemption or expiration of the Rights, the
Company (a) shall, with respect to shares of Common Stock of the Company so
issued or sold pursuant to the exercise of stock options or under any employee
plan or arrangement, or upon the exercise, conversion or exchange of securities
hereinafter issued by the Company, and (b) may, in any other case, if deemed
necessary or appropriate by the Board, issue Rights Certificates representing
the appropriate number of Rights in connection with such issuance or sale;
provided, however, that (i) no such Rights Certificate shall be issued if, and
to the extent that, the Company shall be advised by counsel that such issuance
would create a significant risk of material adverse tax consequences to the
Company or the Person to whom such Rights Certificate would be issued, and (ii)
no such Rights Certificate shall be issued if, and to the extent that,
appropriate adjustment shall otherwise have been made in lieu of the issuance
thereof.
Section 23. Redemption and Termination.
(a) The Board may (following the Stock Acquisition Date, only with the
concurrence of a majority of the Continuing Directors), at its option, at any
time prior to the earlier of (i) the Close of Business on the tenth Business Day
following the Stock Acquisition Date (or, if the Stock Acquisition Date shall
have occurred prior to the Record Date, the Close of Business on the tenth
Business Day following the Record Date) or (ii) the Final Expiration Date,
direct the Company to, and, if so directed, the Company shall, redeem all but
not less than all of the then-outstanding Rights at a redemption price of $.01
per Right, as such amount may be appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring after the date hereof
(such redemption price being hereinafter referred to as the "Redemption Price").
Notwithstanding anything contained in this Agreement to the contrary, the Rights
shall not be exercisable after the first occurrence of a Section 11(a)(ii) Event
until such time as the Company's right of redemption hereunder has expired. The
Company may, at its option, pay the Redemption Price in cash, shares of Common
Stock of the Company (based on the Current Market Price of the Common Stock at
the time of redemption) or any other form of consideration deemed appropriate by
the Board.
(b) Immediately upon the action of the Board (with, if required, the
concurrence of a majority of the Continuing Directors) ordering the redemption
of the Rights, evidence of which shall have been filed with the Rights Agent and
without any further action and without any notice, the right to exercise the
Rights will terminate and the only right thereafter of the holders of Rights
shall be to receive the Redemption Price for each Right so held. Promptly after
the action of the Board ordering the redemption of the Rights, the Company shall
give notice of such redemption to the Rights Agent and the holders of the
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then-outstanding Rights by first-class mail to all such holders at each holder's
last address as it appears upon the registry books of the Rights Agent or, prior
to the Distribution Date, on the registry books of the transfer agent for the
Common Stock. Any notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice. Each such notice of
redemption will state the method by which the payment of the Redemption Price,
will be made.
Section 24. Notice of Certain Events.
(a) In case the Company shall propose, at any time after the
Distribution Date, (i) to pay any dividend payable in stock of any class to the
holders of its Common Stock or to make any other distribution to the holders of
its Common Stock (other than a regular periodic cash dividend out of earnings or
retained earnings of the Company), or (ii) to offer to the holders of its Common
Stock rights or warrants to subscribe for or to purchase any additional shares
of Common Stock or shares of stock of any class or any other securities, rights
or options, or (iii) to effect any reclassification of its Common Stock (other
than a reclassification involving only the subdivision of outstanding shares of
Common Stock), or (iv) to effect any consolidation or merger into or with any
other Person (other than a Subsidiary of the Company in a transaction which
complies with Section 11(o) hereof), or to effect any sale or other transfer (or
to permit one or more of its Subsidiaries to effect any sale or other transfer),
in one transaction or a series of related transactions, of more than 50% of the
assets or earning power of the Company and its Subsidiaries (taken as a whole)
to any other Person or Persons (other than the Company and/or any of its
Subsidiaries in one or more transactions each of which complies with Section
11(o) hereof), or (v) to effect the liquidation, dissolution or winding up of
the Company, then, in each such case, the Company shall give to each holder of a
Rights Certificate, to the extent feasible and in accordance with Section 25
hereof, a notice of such proposed action, which shall specify the record date
for the purposes of such stock dividend or distribution of rights or warrants,
or the date on which such reclassification, consolidation, merger, sale,
transfer, liquidation, dissolution or winding up is to take place and the date
of participation therein by the holders of the shares of Common Stock, if any
such date is to be fixed, and such notice shall be so given in the case of any
action covered by clause (i) or (ii) above at least twenty (20) days prior to
the record date for determining holders of the shares of Common Stock for
purposes of such action, and in the case of any such other action, at least
twenty (20) days prior to the date of the taking of such proposed action or the
date of participation therein by the holders of the shares of Common Stock,
whichever shall be the earlier.
(b) In case any of the events set forth in Section 11(a)(ii) hereof
shall occur, then, in any such case, the Company shall as soon as practicable
thereafter give to each holder of a Rights Certificate, to the extent feasible
and in accordance with Section 25 hereof, a notice of the occurrence of such
event, which shall specify the event and the consequences of the event to
holders of Rights under Section 11(a)(ii) hereof.
Section 25. Notices. Notices or demands authorized by this Agreement to
be given or made by the Rights Agent or by the holder of any Rights Certificate
to or on the Company shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed (until another address is filed in writing with
the Rights Agent) as follows:
-▇▇-
▇▇▇▇▇▇ ▇▇▇▇▇ Company
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: President
Subject to the provisions of Section 21, any notice or demand
authorized by this Agreement to be given or made by the Company or by the holder
of any Rights Certificate to or on the Rights Agent shall be sufficiently given
or made if sent by first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Company) as follows:
The First National Bank of Boston
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Mail Stop 45-02-15
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Shareholder Services Division
▇▇▇▇▇▇ ▇▇▇▇▇ Company Rights Agreement
Notices or demands authorized by this Agreement to be given or made by
the Company or the Rights Agent to the holder of any Rights Certificate (or, if
prior to the Distribution Date, to the holder of certificates representing
shares of Common Stock of the Company) shall be sufficiently given or made if
sent by first-class mail, postage prepaid, addressed to such holder at the
address of such holder as shown on the registry books of the Company.
Section 26. Supplements and Amendments. Prior to the Distribution Date
and subject to the penultimate sentence of this Section 26, the Company and the
Rights Agent shall, if the Board so directs, supplement or amend any provision
of this Agreement without the approval of any holders of certificates
representing shares of Common Stock of the Company. From and after the
Distribution Date and subject to the penultimate sentence of this Section 26,
the Company and the Rights Agent shall, if the Board so directs, supplement or
amend this Agreement without the approval of any holders of Rights Certificates
in order (i) to cure any ambiguity, (ii) to correct or supplement any provision
contained herein which may be defective or inconsistent with any other
provisions herein, (iii) to shorten or lengthen any time period hereunder (which
shortening or lengthening, after the Stock Acquisition Date, shall require the
concurrence of a majority of such Continuing Directors) or (iv) to change or
supplement the provisions hereunder in any manner which the Company may deem
necessary or desirable and which shall not adversely affect the interests of the
holders of Rights Certificates (other than an Acquiring Person or an Affiliate
or Associate of any such Person); provided, however, that this Agreement may not
be supplemented or amended to lengthen, pursuant to clause (iii) of this
sentence, (A) a time period relating to when the Rights may be redeemed or to
modify the ability (or inability) of the Board (with, where required, the
concurrence of a majority of the Continuing Directors) to redeem the Rights, in
either case at such time as the Rights are not then redeemable or (B) any other
time periods unless such lengthening, is for the purpose of protecting,
enhancing or clarifying the rights of, and/or the benefits to, the holders of
Rights (other than an Acquiring Person or an Affiliate or Associate of any such
Person). Upon the delivery of a certificate from an appropriate officer of the
Company which states that the proposed supplement or amendment is in compliance
with the terms of this Section 26, the Rights Agent shall execute such
supplement or amendment. Notwithstanding anything contained in this
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Agreement to the contrary, no supplement or amendment shall be made which
changes the Redemption Price, the Final Expiration Date, the Purchase Price or
the number of shares of Common Stock for which a Right is exercisable. Prior to
the Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Common Stock of the Company.
Section 27. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
Section 28. Determinations and Actions by the Board, etc. For all
purposes of this Agreement, any calculation of the number of shares of Common
Stock of the Company outstanding at any particular time, including for purposes
of determining the particular percentage of such outstanding shares of Common
Stock of the Company of which any Person is the Beneficial Owner, shall be made
in accordance with the last sentence of Rule 13d-3(d)(1)(i) of the General Rules
and Regulations under the Exchange Act. The Board (with, where specifically
provided for herein, the concurrence of Continuing Directors) shall have the
exclusive power and authority to administer this Agreement and to exercise all
rights and powers specifically granted to the Board (with, where specifically
provided for herein, the concurrence of Continuing Directors) or to the Company,
or as may be necessary or advisable in the administration of this Agreement
including, without limitation, the right and power to (a) interpret the
provisions of this Agreement and (b) make all determinations deemed necessary or
advisable for the administration of this Agreement (including a determination to
redeem or not redeem the Rights or to amend the Agreement). All such actions,
calculations, interpretations and determinations (including, for purposes of
clause (y) below, all omissions with respect to the foregoing) which are done or
made by the Board (with, where specifically provided for herein, the concurrence
of Continuing Directors), the Continuing Directors, the Outside Directors or the
Company in good faith, shall (x) be final, conclusive and binding on the
Company, the Rights Agent, the holders of the Rights and all other parties and
(y) not subject the Board, the Continuing Directors or the Outside Directors to
any liability to the holders of the Rights.
Section 29. Exchange.
(a) The Board (with the concurrence of the Continuing Directors) may,
at its option, at any time after any Person becomes an Acquiring Person,
exchange all or part of the then outstanding and exercisable Rights (which shall
not include Rights that have become void pursuant to the provision of Section
7(e) hereof) for shares of Common Stock of the Company at an exchange ratio of
one share of Common Stock of the Company per Right, appropriately adjusted to
reflect any stock split, stock dividend or similar transaction occurring after
the date hereof (such exchange ratio being hereinafter referred to as the
"Exchange Ratio"). Notwithstanding the foregoing, the Board shall not be
empowered to effect such exchange at any time after any Person (other than an
Exempt Person) becomes the Beneficial Owner of 50% or more of the shares of
Common Stock of the Company then outstanding.
(b) Immediately upon the action of the Board ordering the exchange of
any Rights pursuant to paragraph (a) of this Section 29 and without any further
action and without notice, the right to exercise such Rights shall terminate and
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the only right thereafter of a holder of such Rights shall be to receive that
number of shares of Common Stock of the Company equal to the number of such
Rights held by such holder multiplied by the Exchange Ratio. The Company shall
promptly give public notice of any such exchange; provided, however, that the
failure to give, or any defect in, such notice shall not affect the validity of
such exchange. The Company promptly shall mail a notice of any such exchange to
all of the holders of such Rights at their last addresses as they appear upon
the registry books of the Rights Agent or, prior to the Distribution Date, on
the registry books of the Transfer Agent for the Common Stock. Any notice which
is mailed in the manner herein provided shall be deemed given, whether or not
the holder receives the notice. Each such notice of exchange will state the
method by which the exchange of the shares of Common Stock of the Company for
Rights will be effected and, in the event of any partial exchange, the number of
Rights which will be exchanged. Any partial exchange shall be effected pro rata
based on the number of Rights (other than Rights which have become void pursuant
to the provisions of Section 7(e) hereof) held by each holder of Rights.
(c) In the event that there shall not be sufficient shares of Common
Stock of the Company issued but not outstanding or authorized but unissued to
permit any exchange of Rights as contemplated in accordance with this Section
29, the Company shall take all such action as may be necessary to authorize
additional shares of Common Stock of the Company for issuance upon exchange of
the Rights.
(d) The Company shall not be required to issue fractions of shares of
Common Stock of the Company or to distribute certificates which evidence
fractional shares of Common Stock of the Company. In lieu of such fractional
shares of Common Stock of the Company, there shall be paid to the registered
holders of the Rights Certificates with regard to which such fractional shares
of Common Stock of the Company would otherwise be issuable an amount in cash
equal to the same fraction of the current market value of a whole share of
Common Stock of the Company. For the purposes of this paragraph (e), the current
market value of a whole share of Common Stock of the Company shall be the
closing price of a share of Common Stock of the Company or, if unavailable, the
appropriate alternative price (in each case as determined pursuant to Section
11(d)(i) hereof) for the Trading Day immediately prior to the date on which the
Board takes action ordering an exchange pursuant to this Section 29.
Section 30. Benefits of this Agreement. Nothing in this Agreement shall
be construed to give to any Person other than the Company, the Rights Agent and
the registered holders of the Rights Certificates (and, prior to the
Distribution Date, registered holders of the Common Stock of the Company) any
legal or equitable right, remedy or claim under this Agreement; but this
Agreement shall be for the sole and exclusive benefit of the Company, the Rights
Agent and the registered holders of the Rights Certificates (and, prior to the
Distribution Date, registered holders of the Common Stock of the Company).
Section 31. Severability. If any term, provision, covenant or
restriction of this Agreement shall be held by a court of competent jurisdiction
or other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated;
provided, however, that, notwithstanding anything in this Agreement to the
contrary, if any such term, provision, covenant or restriction shall be held by
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such court or authority to be invalid, void or unenforceable and the Board (with
the concurrence of a majority of the Continuing Directors) shall determine in
its good faith judgment that severing the invalid language from this Agreement
would adversely affect the purpose or effect of this Agreement, the right of
redemption set forth in Section 23 hereof shall be reinstated and shall not
expire until the Close of Business on the tenth Business Day following the date
of such determination by the Board. Without limiting the foregoing, if any
provision of this Agreement requiring that a determination be made by the Board
with the concurrence of a majority of the Continuing Directors or by the
Continuing Directors or the Outside Directors shall be held by a court of
competent jurisdiction or other authority to be invalid, void or unenforceable,
such determination shall then be made by the Board in accordance with applicable
law and the Company's Articles of Organization and Bylaws (as each of these
shall have been amended or restated from time to time).
Section 32. Governing Law. This Agreement, each Right and each Rights
Certificate issued hereunder shall be deemed to be a contract made under the
laws of The Commonwealth of Massachusetts and for all purposes shall be governed
by and construed in accordance with the laws of said Commonwealth applicable to
contracts made and to be performed entirely within said Commonwealth.
Section 33. Counterparts. This Agreement may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, but all such counterparts shall together constitute but one
and the same instrument.
Section 34. Descriptive Headings. Descriptive headings of the several
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed under seal as of the day and year first above written.
Attest: ▇▇▇▇▇▇ ▇▇▇▇▇ COMPANY.
_________________________________ By:_______________________________
Name: Name:
Title: Title:
Attest: THE FIRST NATIONAL BANK OF
BOSTON, as Rights Agent
_________________________________ By:_______________________________
Name: Name:
Title: Title:
-36-
Exhibit A
▇▇▇▇▇▇ ▇▇▇▇▇ COMPANY.
SUMMARY OF RIGHTS TO PURCHASE COMMON SHARES
At its meeting of February 9, 1996, the Board of Directors of ▇▇▇▇▇▇
▇▇▇▇▇ Company. (the "Company") declared a dividend distribution of one Right (as
hereinafter defined) for each of the Company's outstanding shares of Common
Stock, par value $2.50 per share (the "Common Shares"), to holders of record of
the Common Shares at the close of business on February 29, 1996 and authorized
and directed the issuance of one Right per share to each holder of Common Shares
issued by the Company after February 29, 1996 and before the Distribution Date
(as hereinafter defined). Each Right entitles the registered holder to purchase
from the Company one share of Common Stock or, in certain circumstances, to
receive cash, property or other securities of the Company, at a Purchase Price
of $25 per share of Common Stock, subject to adjustment (collectively, the
"Rights"). The description and terms of the Rights are set forth in a Rights
Agreement (the "Rights Agreement") between the Company and The First National
Bank of Boston, as Rights Agent.
Initially, the Rights will be attached to all certificates representing
the Common Shares and no separate Rights Certificates will be distributed. The
Rights will separate from the Common Shares and a Distribution Date will occur
upon the earlier of (i) ten (10) business days (or such later date as the
Company's Board of Directors may determine before a Distribution Date occurs)
following a public announcement by the Company that a person or group of
affiliated or associated persons, with certain exceptions (an "Acquiring
Person"), has acquired, or has obtained the right to acquire, beneficial
ownership of 20% or more of the outstanding Common Shares (the date of such
announcement being the "Stock Acquisition Date") or (ii) ten (10) business days
(or such later date as the Company's Board of Directors may determine before a
Distribution Date occurs) following the commencement of a tender offer or
exchange offer that would result, if consummated, in a person becoming an
Acquiring Person.
Until the Distribution Date, (i) the Rights will be evidenced by the
certificates representing the Common Shares and will be transferred with and
only with such certificates representing Common Shares, (ii) all newly issued
certificates representing Common Shares will contain a notation incorporating
the Rights Agreement by reference and (iii) the surrender for transfer of any
certificates for Common Shares outstanding will also constitute the transfer of
the Rights associated with the Common Shares represented by such certificates.
The Rights are not exercisable until the Distribution Date and will
expire at the close of business on February 8, 2006 unless earlier redeemed or
exchanged by the Company as described below.
As soon as practicable after the Distribution Date, Rights Certificates
will be mailed to holders of record of the Common Shares as of the close of
business on the Distribution Date and, from and after the Distribution Date, the
separate Rights Certificates alone will represent the Rights.
In the event (a "Flip-In Event") that a Person becomes an Acquiring
Person (except pursuant to a tender or exchange offer for all outstanding Common
Shares at a price and on terms which a majority of the Company's Outside
Directors (as defined in the Rights Agreement) determines to be fair to and
otherwise in the best interests of the Company and its shareholders (a "fair
offer")), each holder of a Right will thereafter have the right to receive, upon
exercise of such Right, Common Shares (or, in certain circumstances, cash,
property or other securities of the Company) having a Current Market Price (as
defined in the Rights Agreement) equal to two (2) times the exercise price of
the Right. Notwithstanding the foregoing, following the occurrence of any
Flip-In Event, all Rights that are, or (under certain circumstances specified in
the Rights Agreement) were, beneficially owned by any Acquiring Person (or by
certain related parties) will be null and void in the circumstances set forth in
the Rights Agreement. However, Rights will not be exercisable following the
occurrence of any Flip-In Event until such time as the Rights are no longer
redeemable by the Company as set forth below.
For example, at an exercise price of $25 per Right, each Right not
owned by an Acquiring Person (or by certain related parties) following a Flip-In
Event would entitle its holder to purchase $50 worth of Common Shares (or other
consideration, as noted above) for $25. Assuming that the Common Shares had a
Current Market Price of $5.00 per share at such time, the holder of each valid
Right would be entitled to purchase ten (10) Common Shares for $25.
In the event (a "Flip-Over Event") that, at any time on or after the
Share Acquisition Date, (i) the Company shall take part in a merger or other
business combination transaction (other than certain mergers that follow a fair
offer) and the Company shall not be the surviving entity or (ii) the Company
shall take part in a merger or other business combination transaction in which
the Common Shares are changed or exchanged (other than certain mergers that
follow a fair offer) or (iii) 50% or more of the Company's assets or earning
power is sold or transferred, each holder of a Right (except Rights which
previously have been voided, as set forth above) shall thereafter have the right
to receive, upon exercise, a number of shares of common stock of the acquiring
company having a Current Market Price equal to two (2) times the exercise price
of the Right. Flip-In Events and Flip-Over Events are collectively referred to
as "Triggering Events".
The Purchase Price payable and the number of Common Shares (or the
amount of cash, property or other securities) issuable upon exercise of the
Rights are subject to adjustment from time to time to prevent dilution (i) in
the event of a share dividend on, or a subdivision, combination or
reclassification of, the Common Shares, (ii) if holders of the Common Shares are
granted certain rights or warrants to subscribe for Common Shares or convertible
securities at less than the Current Market Price of the Common Shares or (iii)
upon the distribution to holders of the Common Shares of evidences of
indebtedness or assets (excluding regular periodic cash dividends) or of
subscription rights or warrants (other than those referred to above).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments amount to at least 1% of the Purchase
Price. The Company is not required to issue fractional Common Shares upon the
exercise of any Right or Rights. In lieu thereof, a cash payment may be made, as
provided in the Rights Agreement.
-2-
At any time before a Distribution Date, the Company may redeem the
Rights in whole, but not in part, at a price of $.01 per Right, payable, at the
option of the Company, in cash, Common Shares or such other consideration as the
Board of Directors may determine. Immediately upon the effectiveness of the
action of the Company's Board of Directors ordering redemption of the Rights,
the Rights will terminate and the only right of the holders of Rights will be to
receive the $.01 per Right redemption price. Alternatively, the Board of
Directors can, at any time after any Person becomes an Acquiring Person, cause
the Rights to be exchanged for an equivalent number of shares of Common Stock,
at no cost to the holders of the Rights.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the right
to vote or to receive dividends. While the distribution of the Rights will not
be taxable to shareholders or to the Company, shareholders may, depending upon
the circumstances, recognize taxable income in the event that the Rights become
exercisable for Common Shares (or cash, property or other securities) of the
Company or for common stock of the acquiring company as set forth above.
The terms of the Rights, other than key financial terms and the date on
which the Rights expire, may be amended by the Board of Directors of the Company
prior to the Distribution Date. Thereafter, the provisions of the Rights
Agreement may be amended by the Board of Directors only in order to cure any
ambiguity, defect or inconsistency, to make changes which do not adversely
affect the interests of holders of Rights (excluding the interests of any
Acquiring Person and certain other related parties) or to shorten or lengthen
any time period under the Rights Agreement; provided, however, that no amendment
to lengthen the time period governing redemption shall be made at such time as
the Rights are not redeemable.
A copy of the Rights Agreement has been or will be filed with the
Securities and Exchange Commission as an Exhibit to a report on Form 8-K. A copy
of the Rights Agreement is available free of charge from the Company or the
Rights Agent. This summary description of the Rights does not purport to be
complete and is qualified in its entirety by reference to the Rights Agreement,
which is incorporated herein by reference.
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Exhibit B
[Form of Rights Certificate]
Certificate No. R-______ ___________ Rights
NOT EXERCISABLE AFTER FEBRUARY 8, 2006 OR EARLIER IF REDEEMED BY THE
COMPANY. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT
$.01 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY AN ACQUIRING PERSON, OR AN AFFILIATE
OR ASSOCIATE OF AN ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS
AGREEMENT), AND ANY SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND VOID.
[THE RIGHTS REPRESENTED BY THIS RIGHTS CERTIFICATE ARE OR WERE BENEFICIALLY
OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN AFFILIATE OR
ASSOCIATE OF AN ACQUIRING PERSON. ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE
RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES
SPECIFIED IN SECTION 7(e) OF SUCH AGREEMENT.]1
Rights Certificate
▇▇▇▇▇▇ ▇▇▇▇▇ COMPANY
This certifies that ______________________________________, or his or
her 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 February 9, 1996
(the "Rights Agreement"), by and between ▇▇▇▇▇▇ ▇▇▇▇▇ Company, a Massachusetts
corporation (the "Company"), and The First National Bank of Boston, a national
banking association (the "Rights Agent"), to purchase from the Company at any
time prior to 5:00 P.M. (Boston time), on February 8, 2006 at the office or
offices of the Rights Agent designated for such purpose, or at the office or
offices of its successors as Rights Agent, one fully paid, nonassessable, share
of the Common Stock of the Company, par value $2.50 per share, or, in certain
circumstances, to receive cash, property, other shares of Common Stock and/or
other securities of the Company, at a purchase price of $25 (the "Purchase
Price"), upon presentation and surrender of this Rights Certificate with the
Form of Election to Purchase and related Certificate duly executed. The number
of Rights evidenced by this Rights Certificate (and the number of shares of
Common
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1 The portion of the legend in brackets shall be inserted only if
applicable and shall replace the second sentence.
Stock which may be purchased upon exercise thereof) set forth above, and the
Purchase Price set forth above, are the number of Rights and the Purchase Price
as of February 29, 1996, respectively, based on the Common Stock as constituted
at such date.
Upon the occurrence of a Section 11(a)(ii) Event (as such term is
defined in the Rights Agreement), if the Rights evidenced by this Rights
Certificate are beneficially owned by (i) an Acquiring Person or an Associate or
Affiliate of an Acquiring Person (as such terms are defined in the Rights
Agreement) who or which is determined by the Board of Directors of the Company
to have been involved in, caused or facilitated such Section 11(a)(ii) Event,
(ii) a transferee of any such Acquiring Person, Associate or Affiliate who or
which becomes a transferee after such Acquiring Person, Associate or Affiliate
becomes such or (iii) under certain circumstances specified in the Rights
Agreement, a transferee of any such Acquiring Person, Associate or Affiliate who
or which becomes a transferee prior to or concurrently with such Acquiring
Person becoming such, such Rights shall become null and void and no holder
hereof shall have any right with respect to such Rights from and after the
occurrence of such Section 11(a)(ii) Event.
As provided in the Rights Agreement, the Purchase Price and the number
and kind of shares of Common Stock (or, in certain circumstances, the amount of
cash, property, other shares of Common Stock or other securities) deliverable
upon exercise of the Rights evidenced by this Rights Certificate are subject to
modification and adjustment upon the happening of certain events, including
those events specified in Section 11(a)(ii) and Section 13 of the Rights
Agreement.
This Rights Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Rights Certificates, which
limitations of rights include the temporary suspension of the exercisability of
such Rights under the specific circumstances set forth in the Rights Agreement.
Copies of the Rights Agreement are on file at the offices of the Rights Agent
and are also available upon written request to the Rights Agent.
This Rights Certificate, with or without other Rights Certificates,
upon surrender at the principal office or offices of the Rights Agent designated
for such purpose, may be exchanged for another Rights Certificate or Rights
Certificates of like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of shares of Common Stock as the Rights
evidenced by the Rights Certificate or Rights Certificates surrendered shall
have entitled such holder to purchase. If this Rights Certificate shall be
exercised in part, the holder shall be entitled to receive upon surrender hereof
another Rights Certificate or Rights Certificates for the number of whole Rights
not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced
by this Certificate may be redeemed by the Company at a redemption price of $.01
per Right at any time prior to the earlier of the close of business on (i) the
tenth business day following the first date of public announcement by the
Company that an Acquiring Person has become such (or if the date of such
announcement shall have occurred prior to February 29, 1996, the close of
business on the tenth business day following February 29, 1996) and (ii) the
close of business on February 8, 2006.
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The Company is not required to issue fractional shares of Common Stock
upon the exercise of any Right or Rights evidenced hereby. In lieu thereof, a
cash payment may be made, as provided in the Rights Agreement.
No holder of this Rights Certificate, as such, shall be entitled to
vote or receive dividends or be deemed for any purpose to be the holder of
shares of Common Stock or of any other securities of the Company which may at
any time be issuable on the exercise hereof, nor shall anything contained in the
Rights Agreement or herein be construed to confer upon the holder hereof, as
such, any of the rights of a shareholder of the Company or any right to vote for
the election of directors or upon any matter submitted to shareholders at any
meeting thereof, or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting shareholders (except as
provided in the Rights Agreement), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced by this Rights
Certificate shall have been exercised as provided in the Rights Agreement.
This Rights Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company
and its seal.
Dated as of ___________________.
ATTEST: ▇▇▇▇▇▇ ▇▇▇▇▇ COMPANY
____________________________ By:__________________________
Name: Name:
Title: Secretary Title:
Countersigned:
THE FIRST NATIONAL BANK OF
BOSTON, as Rights Agent
By:_________________________
Authorized Signature
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[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if
such holder desires to transfer the Rights Certificate.)
FOR VALUE RECEIVED, ________________________________________ hereby
sells, assigns and transfers unto
(Please print name and address of transferee)
this Rights Certificate, together with all rights, title and interest therein,
and does hereby irrevocably constitute and appoint
______________________________________ Attorney, to transfer the within Rights
Certificate on the books of the within-named Company, with full power of
substitution.
Dated:____________________
___________________________________
Signature
Signature Guaranteed:
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CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) this Rights Certificate [ ] is [ ] is not being sold, assigned and
transferred by or on behalf of a Person who is or was an Acquiring Person or an
Affiliate or Associate of any such Person (as such terms are defined in 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 Rights Certificate from
any Person who is, was or subsequently became an Acquiring Person or an
Affiliate or Associate of any such Person.
Dated:_______________
__________________________________
Signature
Signature Guaranteed:
NOTICE
The signatures to the foregoing Form of Assignment and Certificate must
correspond to the name as written upon the face of this Rights Certificate in
every particular, without alteration or enlargement or any change whatsoever.
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FORM OF ELECTION TO PURCHASE
(To be executed by the registered holder
if such holder desires to exercise Rights
represented by the Rights Certificate.)
To: ▇▇▇▇▇▇ ▇▇▇▇▇ COMPANY
The undersigned hereby irrevocably elects to exercise ______________
Rights represented by this Rights Certificate to purchase the shares of Common
Stock issuable upon the exercise of the Rights (or such other securities of the
Company or of any other person which may be issuable upon the exercise of the
Rights); enclosed is payment in the amount of $____________, which is the
product of the number of Rights being exercised hereby and the current exercise
price per share of Common Stock subject to each such Right.
The undersigned requests that certificates for such shares be issued in
the name of and delivered to (please include name and address):
Please insert social security or other identifying number:
If such number of Rights exercised hereby shall not be all the Rights
evidenced by this Rights Certificate, a new Rights Certificate for the balance
of such Rights shall be registered in the name of and delivered to (please
include name and address):
Please insert social security or other identifying number:
Dated:
_______________________________
Signature
Signature Guaranteed:
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CERTIFICATE
The undersigned hereby certifies by checking the appropriate boxes
that:
(1) the Rights evidenced by this Rights Certificate [ ] are [ ] are not
being exercised by or on behalf of a Person who is or was an Acquiring Person or
an Affiliate or Associate of any such Acquiring Person (as such terms are
defined in the Rights Agreement); and
(2) after due inquiry and to the best knowledge of the undersigned, it
[ ] did [ ] did not acquire the Rights evidenced by this Rights Certificate from
any Person who is, was or became an Acquiring Person or an Affiliate or
Associate of any such Person.
Dated:
_________________________________
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Form of Election to Purchase and
Certificate must correspond to the name as written upon the face of this Rights
Certificate in every particular, without alteration or enlargement or any change
whatsoever.
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