Exhibit 1
UNIPHASE CORPORATION
and
AMERICAN STOCK TRANSFER & TRUST COMPANY,
Rights Agent
FIRST AMENDED AND RESTATED
RIGHTS AGREEMENT
Dated as of January 16, 1998
TABLE OF CONTENTS
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SECTION PAGE
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Section 1. Certain Definitions 1
Section 2. Appointment of Rights Agent 6
Section 3. Issue of Rights Certificates 6
Section 4. Form of Rights Certificates 8
Section 5. Countersignature and Registration 8
Section 6. Transfer, Split Up, Combination and Exchange of Rights
Certificates; Mutilated, Destroyed, Lost or Stolen
Rights Certificates 8
Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights 9
Section 8. Cancellation and Destruction of Rights Certificates 11
Section 9. Reservation and Availability of Capital Stock 11
Section 10. Preferred Stock Record Date 13
Section 11. Adjustment of Purchase Price, Number and Kind of Shares
or Number of Rights 13
Section 12. Certificate of Adjusted Purchase Price or Number of
Shares 22
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 26
Section 16. Agreement of Rights Holders 26
Section 17. Rights Certificate Holder Not Deemed a Stockholder 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 31
Section 22. Issuance of New Rights Certificates 32
Section 23. Redemption and Termination 32
Section 24. Notice of Certain Events 33
Section 25. Notices 34
Section 26. Supplements and Amendments 34
Section 27. Successors 35
Section 28. Determinations and Actions by the Board of Directors,
etc. 35
Section 29. Benefits of this Agreement 35
Section 30. Severability 36
Section 31. Governing Law 36
Section 32. Counterparts 36
Section 33. Descriptive Headings 36
Section 34. Exchange 36
Exhibit A Form of Rights Certificate A
Exhibit B Form of Summary of Rights B
Exhibit C Certificate of Designation C
FIRST AMENDED AND RESTATED RIGHTS AGREEMENT
FIRST AMENDED AND RESTATED RIGHTS AGREEMENT, dated as of January
____, 1998 (the "Agreement"), between Uniphase Corporation, a Delaware
corporation (the "Company"), and American Stock Transfer & Trust
Company, a New York corporation (the "Rights Agent").
WHEREAS, effective June 22, 1998 (the "Rights Dividend Declaration
Date"), the Board of Directors of the Company (i) authorized and declared
a dividend distribution of one Right for each share of common stock, par
value $.001 per share, of the Company (the "Company Common Stock")
outstanding at the Close of Business on July 6, 1998 (the "Record
Date"), and (ii) authorized the issuance of one Right (as such number may
hereinafter be adjusted pursuant hereto) for each share of Company Common
Stock issued between the Record Date (whether originally issued or
delivered from the Company's treasury) and, except as otherwise provided
in Section 22, the Distribution Date, each Right initially representing
the right to purchase upon the terms and subject to the conditions
hereinafter set forth one Unit of Series B Preferred Stock of the Company
(the "Rights"); and
WHEREAS, the Board of Directors of the Company and the Rights Agent
have determined that it is in the best interest of the Company and the
holders of the Company Common Stock to amend the Agreement with respect to
the provisions governing supplements and amendments to the Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement, the
following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person who or which,
together with all Affiliates or Associates of such Person, shall be
the Beneficial Owner of 15% or more of the shares of Company Common
Stock then outstanding. Notwithstanding the foregoing: (i) an
"Acquiring Person" shall not include (A) the Company, (B) any
Subsidiary of the Company, (C) any employee benefit plan maintained
by the Company or any of its Subsidiaries, (D) any trustee or
fiduciary with respect to such employee benefit plan acting in such
capacity or a trustee or fiduciary holding shares of Company Common
Stock for the purpose of funding any such plan or employee benefits,
(E) any Person who has reported or is required to report Beneficial
Ownership of Company Common Stock on Schedule 13G under the Exchange
Act (or any comparable or successor report), but only so long as (x)
such Person is eligible to report such ownership on Schedule 13(G)
under the Exchange Act (or any comparable or successor report), (y)
such Person has not reported and is not required to report such
ownership on Schedule 13(D) under the Exchange Act (or any
comparable or successor report) and such Person does not hold shares
of Company Common Stock on behalf of any other Person who is
required to report Beneficial Ownership of such shares of Company
Common Stock on such Schedule 13(D), and (z) such Person does not
beneficially own 20% or more of the shares of Company Common Stock
then outstanding, (F) any Person if (1) the Board of Directors of
the Company determines in good faith that such Person who would
otherwise be an "Acquiring Person" became such inadvertently
(including, without limitation, because (x) such Person was unaware
that it beneficially owned a percentage of Company Common Stock that
would otherwise cause such Person to be an "Acquiring Person" or
(y) such Person was aware of the extent of its Beneficial Ownership
of Company Common Stock but had no actual knowledge of the
consequences of such Beneficial Ownership under this Agreement) and
without any intention of changing or influencing control of the
Company, (2) as promptly as practicable such Person divested or
divests itself of Beneficial Ownership of a sufficient number of
shares of Company Common Stock so that such Person would no longer
beneficially own 15% or more of the then outstanding shares of
Company Common Stock, and (3) such Person does not become the
Beneficial Owner of any additional shares of Company Common Stock
after such Person becomes aware that such Person would be an
Acquiring Person (but for the operation of this clause (i)(F)),
unless upon becoming the Beneficial Owner of such additional shares
such Person is the Beneficial Owner of less than 15% of the then
outstanding shares of Company Common Stock, or (G) any Person who
becomes the Beneficial Owner of 15% or more of the then outstanding
shares of Company Common Stock as a result of the acquisition of
shares of Company Common Stock directly from the Company in one or
more transactions approved by the Board of Directors, which Persons
shall include without limitation, Koninklijke Philips Electronics
N.V., a company duly established under the laws of the Netherlands
upon its acquisition of Company Common Stock upon conversion of
those shares of Series A Preferred Stock, par value $.001 per share,
held at the date hereof by such stockholder, and (ii) no Person
shall be deemed an "Acquiring Person" as a result of the
acquisition of shares of Company Common Stock by the Company which,
by reducing the number of shares of Company Common Stock
outstanding, increases the proportional number of shares
beneficially owned by such Person; provided, however, that if (A) a
Person would become an Acquiring Person (but for the operation of
this subclause (ii)) as a result of the acquisition of shares of
Company Common Stock by the Company and (B) after such share
acquisition by the Company, such Person becomes the Beneficial Owner
of any additional shares of Company Common Stock, then such Person
shall be deemed an Acquiring Person unless upon becoming the
Beneficial Owner of such additional shares such Person is the
Beneficial Owner of less than 15% of the then outstanding shares of
Company Common Stock. Each Person identified in subclauses (A),
(B), (C) and (D) of this Section (1)(a) is individually an "Exempt
Person" and collectively "Exempt Persons."
(b) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules
and Regulations under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), as in effect on the date hereof.
(c) A Person shall be deemed the "Beneficial Owner" of, and
shall be deemed to have "Beneficial Ownership" of, and to
"beneficially own", any securities:
(i) of which such Person or any of such Person's
Affiliates or Associates is considered to be a "beneficial
owner" under Rule 13d-3 of the General Rules and Regulations
under the Exchange Act as in effect on the date hereof (the
"Exchange Act Regulations"); provided, however, that a
Person shall not be deemed the "Beneficial Owner" of, to
have "Beneficial Ownership" of, or to "beneficially own",
any securities under this subparagraph (i) as a result of an
agreement, arrangement or understanding to vote such
securities 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 Exchange Act and the Exchange Act Regulations, and (B)
is not reportable by such Person on Schedule 13D under the
Exchange Act (or any comparable or successor report);
(ii) which are beneficially owned, directly or
indirectly, by any other Person (or any Affiliate or Associate
of such other Person) with which such Person (or any of such
Person's Affiliates or Associates) has any agreement,
arrangement or understanding (whether or not in writing), for
the purpose of acquiring, holding, voting (except pursuant to
a revocable proxy or consent as described in the proviso to
subparagraph (i) of this paragraph (c)) or disposing of such
securities; or
(iii) 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 or upon the
satisfaction of conditions) 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 under this paragraph (c) a Person shall not
be deemed the "Beneficial Owner" of, to have "Beneficial
Ownership" of, or to "beneficially own", (A) securities tendered
pursuant to a tender or exchange offer made in accordance with
Exchange Act Regulations by such Person or any of such Person's
Affiliates or Associates until such tendered securities are accepted
for purchase or exchange, (B) securities that may be issued upon
exercise of Rights at any time prior to the occurrence of a
Triggering Event, or (C) securities that may be issued upon exercise
of Rights from and after the occurrence of a Triggering Event, which
Rights were acquired by such Person or any of such Person's
Affiliates or Associates prior to the Distribution Date or pursuant
to Section 3(c) or Section 22 hereof (the "Original Rights") or
pursuant to Section 11(i) hereof in connection with an adjustment
made with respect to any Original Rights; and further provided,
however, that (x) nothing in this paragraph (c) shall cause a Person
engaged in business as an underwriter of securities to be the
"Beneficial Owner" of, to have "Beneficial Ownership" 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, (y)
no decision reached, or action taken, by the Board of Directors of
the Company or any committee thereof shall cause any Person (or any
Affiliate or Associate of such Person) who is a member of the Board
of Directors of the Company or such committee to be deemed, for the
purposes of this Agreement, to be a "Beneficial Owner" of, to have
"Beneficial Ownership" of, or to "beneficially own" any
securities beneficially owned by any other Person (or any Affiliate
or Associate of such Person) who is a member of the Board of
Directors of the Company or any committee thereof solely by reason
of such membership of the Board of Directors or any committee
thereof or participation in the decisions or actions thereof on the
part of either or both of such Persons and (z) no Person who is an
officer, director or employee of an Exempt Person shall be deemed,
solely by reason of such Person's status or authority as such, to be
the "Beneficial Owner" of, to have "Beneficial Ownership" of or
to "beneficially own" any securities that are "beneficially
owned" (as defined in this paragraph (c)), including, without
limitation, in a fiduciary capacity, by an Exempt Person or by any
other such officer, director or employee of an Exempt Person.
(d) "Business Day" shall mean any day other than a
Saturday, Sunday or a day on which banking institutions in the city
of Denver, Colorado or the State of Montana are authorized or
obligated by law or executive order to close.
(e) "Close of Business" on any given date shall mean 5:00
P.M., Pacific time, on such date; provided, however, that if such
date is not a Business Day it shall mean 5:00 P.M., Pacific time, on
the next succeeding Business Day.
(f) "Common Stock" of any Person other than the Company
shall mean the capital stock of such Person with the greatest voting
power, or, if such Person shall have no capital stock, the equity
securities or other equity interest having power to control or
direct the management of such Person.
(g) "Company" means Uniphase Corporation, a Delaware
corporation, and also means a Principal Party to the extent provided
in Section 13(a).
(h) "Company Common Stock" has the meaning set forth in the
Whereas Clause.
(i) "Distribution Date" has the meaning set forth in
Section 3(a).
(j) "Expiration Date" has the meaning set forth in Section
7(a).
(k) "Person" shall mean any individual, partnership, firm,
corporation, association, trust, unincorporated organization or
other entity, as well as any syndicate or group deemed to be a
person under Section 14(d)(2) of the Exchange Act as in effect on
the date hereof.
(l) "Preferred Stock" shall mean the Series B Preferred
Stock, par value $.001 per share, of the Company having the voting
powers, designation, preferences and relative, participating,
optional or other special rights and qualifications, limitations and
restrictions set forth in the Certificate of Designation attached as
Exhibit C hereto, as amended from time to time.
(m) "Purchase Price" has the meaning set forth in Section
7(b).
(n) "Record Date" has the meaning set forth in the Whereas
Clause.
(o) "Right" has the meaning set forth in the Whereas
Clause.
(p) "Rights Certificate" has the meaning set forth in
Section 3(a).
(q) "Rights Dividend Declaration Date" has the meaning set
forth in the Whereas Clause.
(r) "Section 11(a)(ii) Event" shall mean the event
described in Section 11(a)(ii) hereof.
(s) "Section 13 Event" shall mean any event described in
clause (x), (y) or (z) of Section 13(a) hereof.
(t) "Stock Acquisition Date" shall mean the first date of
public announcement (including, without limitation, the filing of
any report, or any amendment to any report, pursuant to Section
13(d) of the Exchange Act (or any comparable or successor report))
by the Company or an Acquiring Person that an Acquiring Person has
become such.
(u) "Subsidiary" shall mean, with reference to any Person,
any other Person of which an amount of voting securities or equity
interests sufficient to elect at least a majority of the directors
or equivalent governing body of such other Person is beneficially
owned, directly or indirectly, by such Person, or otherwise
controlled by such first-mentioned Person.
(v) "Summary of Rights" has the meaning set forth in
Section 3(b).
(w) "Triggering Event" shall mean any Section 11(a)(ii)
Event or any Section 13 Event.
(x) "Unit" has the meaning set forth in Section 7(b).
In addition, the following terms are defined in the Sections
indicated below:
Defined Term Section Number
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Adjustment Shares 11(a)(ii)
Common Stock Equivalents 11(a)(iii)
Current Value 11(a)(iii)
Depositary Agent 7(c)
Equivalent Preferred Stock 11(b)
Exchange Act 1(b)
Exchange Act Regulations 1(c)
Exchange Ratio 34(a)
Exempt Person 1(a)
Final Expiration Date 7(a)
Nasdaq 11(d)(i)
Original Rights 1(c)
Redemption Price 23(a)
Registered Common Stock 13(b)(ii)
Registration Date 9(c)
Registration Statement 9(c)
Section 11(a)(iii) Trigger Date 11(a)(iii)
Securities Act 9(c)
Spread 11(a)(iii)
Substitution Period 11(a)(iii)
Trading Day 11(d)(i)
Section 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company in accordance
with the terms and conditions hereof, and the Rights Agent hereby accepts
such appointment. With the consent of the Rights Agent, the Company may
from time to time appoint such co-rights agents as it may deem necessary
or desirable.
Section 3. Issue of Rights Certificates. (a) Until the earlier of
(i) the Close of Business on the tenth Business Day after the Stock
Acquisition Date, and (ii) the Close of Business on the tenth Business Day
(or such later date as may be determined by action of a majority of the
Board of Directors of the Company prior to the occurrence of a Section
11(a)(ii) Event) 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-4(a) of the Exchange Act Regulations or any
successor rule, if upon consummation thereof such Person would be an
Acquiring Person (including, in the case of both clauses (i) and (ii), any
such time which is after the date of this Agreement and prior to the
issuance of the Rights)(the earlier of (i) and (ii) above being the
"Distribution Date"), (x) the Rights will be evidenced (subject to the
provisions of paragraph (b) of this Section 3) by the certificates for
shares of Company Common Stock registered in the names of the holders of
shares of Company Common Stock as of and subsequent to the Record Date
(which certificates for shares of Company Common Stock shall be deemed
also to be certificates for Rights) and not by separate certificates, and
(y) the Rights will be transferable only in connection with the transfer
of the underlying shares of Company Common Stock including a transfer to
the Company; provided, however, that if a tender or exchange offer is
terminated prior to the occurrence of a Distribution Date, then no
Distribution Date shall occur as a result of such tender or exchange
offer. 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 shares of Company Common Stock as of the Close of
Business on the Distribution Date, at the address of such holder shown on
the records of the Company, one or more rights certificates, in
substantially the form of Exhibit A hereto (the "Rights Certificates"),
evidencing one Right for each share of Company Common Stock so held,
subject to adjustment as provided herein.
In the event that an adjustment in the number of Rights per share of
Company Common Stock has been made pursuant to Section 11(p) hereof, at
the time of distribution of the Rights Certificates, the Company may 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 a Summary of Rights to Purchase Preferred
Stock, in substantially the form attached hereto as Exhibit B (the
"Summary of Rights"), by first-class, postage prepaid mail, to each
record holder of shares of Company Common Stock as of the Close of
Business on the Record Date, at the address of such holder shown on the
records of the Company. With respect to certificates for Company Common
Stock outstanding as of the Record Date, until the Distribution Date, the
Rights will be evidenced by such certificates registered in the names of
the holders thereof together with the Summary of Rights. Until the
Distribution Date (or, if earlier, the Expiration Date), the surrender for
transfer of any such certificate for Company Common Stock outstanding as
of the Record Date, with or without a copy of the Summary of Rights, shall
also constitute the transfer of the Rights associated with the Company
Common Stock represented thereby.
(c) Rights shall, without any further action, be issued in
respect of all shares of Company Common Stock which are issued (including
any shares of Company Common Stock held in treasury) after the Record Date
but prior to the earlier of the Distribution Date and the Expiration Date.
Certificates, representing such shares of Company Common Stock, issued
after the Record Date shall bear the following legend:
This certificate also evidences and entitles the holder hereof to
certain Rights as set forth in the Rights Agreement between Uniphase
Corporation (the "Company") and American Stock Transfer & Trust
Company (the "Rights Agent") dated as of June 22, 1998, as amended
from time to time (the "Rights Agreement"), the terms of which are
hereby incorporated herein by reference and a copy of which is on
file at the principal office of the stock transfer administration
office of the Rights Agent. Under certain circumstances, as set forth
in the Rights Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this certificate. 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 ISSUED TO, OR
HELD 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.
With respect to certificates representing shares of Company Common Stock
that bear the foregoing legend, until the earlier of the Distribution Date
and the Expiration Date, the Rights associated with the shares of Company
Common Stock represented by such certificates shall be evidenced by such
certificates alone and registered holders of the shares of Company Common
Stock 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 shares of Company Common Stock
represented by such certificates.
Section 4. Form of Rights Certificates. The Rights Certificates
(and the forms of election to purchase, assignment and certificate to be
printed on the reverse thereof) shall each be substantially in the form
set forth in Exhibit A 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 any rule or regulation thereunder or with any rule or
regulation of any stock exchange or automated quotation system on which
the Rights may from time to time be listed or to conform to usage. Subject
to the provisions of Section 11 and Section 22 hereof, the Rights
Certificates, whenever distributed, shall be dated as of the Record Date
and on their face shall entitle the holders thereof to purchase such
number of Units of Preferred Stock as shall be set forth therein at the
price set forth therein, but the amount and type of securities, cash or
other assets that may be acquired upon the exercise of each Right and the
Purchase Price thereof shall be subject to adjustment as provided herein.
Section 5. Countersignature and Registration . (a) Rights
Certificates shall be executed on behalf of the Company by its Chairman,
the President or one of its Vice Presidents under its corporate seal
reproduced thereon attested by its Secretary, Treasurer or one of its
Assistant Secretaries. The signature of any of these officers on the
Rights Certificates may be manual or facsimile. Rights Certificates
bearing the manual or facsimile signatures of the individuals who were at
any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold
such offices prior to the countersignature of such Rights Certificates or
did not hold such offices at the date of such Rights Certificates. No
Rights Certificate shall be entitled to any benefit under this Agreement
or be valid for any purpose unless there appears on such Rights
Certificate a countersignature duly executed by the Rights Agent by manual
signature of an authorized signatory, and such countersignature upon any
Rights Certificate shall be conclusive evidence, and the only evidence,
that such Rights Certificate has been duly countersigned as required
hereunder.
(b) Following the Distribution Date, the Rights Agent will keep
or cause to be kept, at its office designated 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 name and address of each holder of the Rights Certificates, the
number of Rights evidenced on its face by each Rights Certificate and the
date of each Rights Certificate.
Section 6. Transfer, Split Up, Combination and Exchange of Rights
Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates.
(a) Subject to the provisions of Sections 4, 7(e) and 14 hereof, at any
time after the Close of Business on the Distribution Date, and at or prior
to the Close of Business on the Expiration Date, any Rights Certificate or
Certificates may be transferred, split up, combined or exchanged for
another Rights Certificate or Certificates, entitling the registered
holder to purchase a like number of Units of Preferred Stock (or,
following a Triggering Event, other securities, cash or other assets, as
the case may be) as the Rights Certificate or Certificates surrendered
then entitled such holder to purchase. Any registered holder desiring to
transfer, split up, combine or exchange any Rights Certificate or
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 office of the Rights
Agent designated for such purpose. Neither the Rights Agent nor the
Company shall be obligated to take any action whatsoever with respect to
the transfer of any such surrendered Rights Certificate until the
registered holder shall have completed and executed the certificate set
forth in the form of assignment on the reverse side of such Rights
Certificate and shall have provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) of the
Rights represented by such Rights Certificate or Affiliates or Associates
thereof as the Company shall reasonably request; whereupon the Rights
Agent shall, subject to the provisions of 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) Subject to Section 7(e) hereof, if a Rights Certificate
shall be mutilated, lost, stolen or destroyed, upon request by the
registered holder of the Rights represented thereby and upon payment to
the Company and the Rights Agent of all reasonable expenses incident
thereto, there shall be issued, in exchange for and upon cancellation of
the mutilated Rights Certificate, or in substitution for the lost, stolen
or destroyed Rights Certificate, a new Rights Certificate, in
substantially the form of the prior Rights Certificate, of like tenor and
representing the equivalent number of Rights, but, in the case of loss,
theft or destruction, only upon receipt of evidence satisfactory to the
Company and the Rights Agent of such loss, theft or destruction of such
Rights Certificate and, if requested by the Company or the Rights Agent,
indemnity also satisfactory to it.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of
Rights. (a) Prior to the earlier of (i) the Close of Business on the
tenth anniversary hereof (the "Final Expiration Date"), (ii) the time at
which the Rights are redeemed as provided in Section 23 hereof or (iii)
the time at which the Rights are exchanged as provided in Section 34
hereof (the earlier of (i), (ii) and (iii) being the "Expiration Date"),
the registered holder of any Rights Certificate may, subject to the
provisions of Sections 7(e), 9(c) and 11(a)(ii) hereof, exercise the
Rights evidenced thereby, in whole or in part, at any time after the
Distribution Date upon surrender of the Rights Certificate, with the form
of election to purchase and the certificate on the reverse side thereof
duly executed, to the Rights Agent at the office of the Rights Agent
designated for such purpose, together with payment of the aggregate
Purchase Price (as hereinafter defined) for the number of Units of
Preferred Stock (or, following a Triggering Event, other securities, cash
or other assets, as the case may be) for which such surrendered Rights are
then exercisable.
(b) The purchase price for each one one-thousandth of a share
(each such one one-thousandth of a share being a "Unit") of Preferred
Stock upon exercise of Rights shall be $270, subject to adjustment from
time to time as provided in Sections 11 and 13(a) hereof (such purchase
price, as so adjusted, being the "Purchase Price"), and shall be payable
in accordance with paragraph (c) below.
(c) As promptly as practicable following the occurrence of the
Distribution Date, the Company shall deposit with the Rights Agent or
other corporation in good standing organized under the laws of the United
States or any State of the United States, which is authorized under such
laws to exercise corporate trust or stock transfer powers and is subject
to supervision or examination by federal or state authority (such
institution being the "Depositary Agent"), certificates representing the
shares of Preferred Stock that may be acquired upon exercise of the Rights
and shall cause such Depositary Agent to enter into an agreement pursuant
to which the Depositary Agent shall issue receipts representing interests
in the shares of Preferred Stock so deposited. Upon receipt of a Rights
Certificate representing exercisable Rights, with the form of election to
purchase and the certificate duly executed, accompanied by payment, with
respect to each Right so exercised, of the Purchase Price for the Units of
Preferred Stock (or, following a Triggering Event, other securities, cash
or other assets, as the case may be) to be purchased thereby as set forth
below and an amount equal to any applicable transfer tax or evidence
satisfactory to the Company of payment of such tax, the Rights Agent
shall, subject to Section 20(k) hereof, thereupon promptly (i) requisition
from the Depositary Agent depositary receipts representing such number of
Units of Preferred Stock as are to be purchased and the Company will
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 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. In the event
that the Company is obligated to issue Company Common Stock, other
securities of the Company, pay cash and/or distribute other property
pursuant to Section 11(a) hereof, the Company will make all arrangements
necessary so that such Company Common Stock, other securities, cash and/or
other property are available for distribution by the Rights Agent, if and
when appropriate. The payment of the Purchase Price (as such amount may be
reduced pursuant to Section 11(a)(iii) hereof) may be made in cash or by
certified or bank check or money order payable to the order of the
Company.
(d) In case the registered holder of any Rights Certificate
shall exercise less than all the Rights evidenced thereby, a new Rights
Certificate evidencing the Rights remaining unexercised shall be issued by
the Rights Agent and delivered to, or upon the order of, the registered
holder of such Rights Certificate, registered in such name or names as may
be designated by such holder, subject to the provisions of Section 14
hereof.
(e) Notwithstanding anything in this Agreement to the contrary,
from and after the first occurrence of a Section 11(a)(ii) Event, any
Rights beneficially owned by (i) an Acquiring Person or an Associate or
Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person
(or of any such Associate or Affiliate) which becomes a transferee after
the Acquiring Person becomes such, or (iii) a transferee of an Acquiring
Person (or of any such Associate or Affiliate) which becomes a transferee
prior to or concurrently with the Acquiring Person becoming such and which
receives such Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person (or any such Associate or
Affiliate) to holders of equity interests in such Acquiring Person (or any
such Associate or Affiliate) or to any Person with whom the Acquiring
Person (or such Associate or Affiliate) has any continuing agreement,
arrangement or understanding regarding the transferred Rights, shares of
Company Common Stock or the Company or (B) a transfer which the Board of
Directors has determined to be part of a plan, arrangement or
understanding which has as a primary purpose or effect the avoidance of
this Section 7(e), shall be null and void without any further action, and
no holder of such Rights shall have any rights whatsoever with respect to
such Rights, whether under any provision of this Agreement or otherwise.
The Company shall use all reasonable efforts to ensure that the provisions
of this Section 7(e) are complied with, but shall have no liability to any
holder of Rights or any other Person as a result of its failure to make
any determination under this Section 7(e) with respect to an Acquiring
Person or its Affiliates, Associates or transferees.
(f) Notwithstanding anything in this Agreement or any Rights
Certificate to the contrary, neither the Rights Agent nor the Company
shall be obligated to undertake any action with respect to a registered
holder upon the occurrence of any purported exercise by such registered
holder unless such registered holder shall have (i) completed and executed
the certificate following the form of election to purchase set forth on
the reverse side of the Rights Certificate surrendered for such exercise,
and (ii) provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) of the Rights represented by
such Rights Certificate 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 this Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement, and the Rights Agent shall
so cancel and retire, any Rights Certificates acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall deliver
all cancelled Rights Certificates to the Company, or shall, at the written
request of the Company, destroy such cancelled Rights Certificates, and in
such case shall deliver a certificate of destruction thereof to the
Company.
Section 9. Reservation and Availability of Capital Stock. (a) The
Company shall at all times prior to the Expiration Date cause to be
reserved and kept available, out of its authorized and unissued shares of
preferred stock, the number of shares of Preferred Stock that, as provided
in this Agreement, will be sufficient to permit the exercise in full of
all outstanding Rights. Upon the occurrence of any events resulting in an
increase in the aggregate number of shares of Preferred Stock (or other
equity securities of the Company) issuable upon exercise of all
outstanding Rights above the number then reserved, the Company shall make
appropriate increases in the number of shares so reserved to the extent
practicable.
(b) If the shares of Preferred Stock to be issued and delivered
upon the exercise of the Rights may be listed on any national securities
exchange or automated quotation system, the Company shall during the
period from the Distribution Date through the Expiration Date use its best
efforts to cause all securities reserved for such issuance to be listed on
such exchange or system upon official notice of issuance upon such
exercise.
(c) The Company shall use its best efforts (i) as soon as
practicable following the occurrence of a Section 11(a)(ii) Event and a
determination by the Company in accordance with Section 11(a)(iii) hereof
of the consideration to be delivered by the Company upon exercise of the
Rights or, if so required by law, as soon as practicable following the
Distribution Date (such date being the "Registration Date"), to file a
registration statement on an appropriate form under the Securities Act of
1933, as amended (the "Securities Act"), with respect to the securities
that may be acquired upon exercise of the Rights (the "Registration
Statement"), (ii) to cause the Registration Statement to become effective
as soon as practicable after such filing, (iii) to cause the Registration
Statement to continue to be effective (and to include a prospectus
complying with the requirements of the Securities Act) until the earlier
of (A) the date as of which the Rights are no longer exercisable for the
securities covered by the Registration Statement, and (B) the Expiration
Date and (iv) to take as soon as practicable following the Registration
Date such action as may be required to ensure that any acquisition of
securities upon exercise of the Rights complies with any applicable state
securities or "blue sky" laws. The Company may temporarily suspend, for
a period of time not to exceed one hundred twenty (120) days after the
date set forth in clause (i) of the first sentence of this Section 9(c),
the exercisability of the Rights in order to prepare and file such
registration statement and permit it to become effective. Upon any such
suspension, the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as well as a
public announcement at such time as the suspension is no longer in effect.
In addition, if the Company shall determine that a registration statement
is required following the Distribution Date, the Company may temporarily
suspend the exercisability of the Rights until such time as a registration
statement has been declared effective. Notwithstanding any provision of
this Agreement to the contrary, the Rights shall not be exercisable in any
jurisdiction if the requisite qualification in such jurisdiction shall not
have been obtained, the exercise thereof shall not be permitted under
applicable law or a registration statement shall not have been declared
effective.
(d) The Company shall take such action as may be necessary to
ensure that all shares of Preferred Stock (and, following the occurrence
of a Triggering Event, any other securities that may be delivered upon
exercise of Rights) shall be, at the time of delivery of the certificates
or depositary receipts for such securities (subject to payment of the
Purchase Price), duly and validly authorized and issued and fully paid and
non-assessable.
(e) The Company shall pay any documentary, stamp or transfer tax
imposed in connection with the issuance or delivery of the Rights
Certificates or upon the exercise of Rights; provided, however, the
Company shall not be required to pay any such tax imposed in connection
with the issuance or delivery of Units of Preferred Stock, or any
certificates or depositary receipts for such Units of Preferred Stock (or,
following the occurrence of a Triggering Event, any other securities, cash
or assets, as the case may be) to any Person other than the registered
holder of the Rights Certificates evidencing the Rights surrendered for
exercise. The Company shall not be required to issue or deliver any
certificates or depositary receipts for Units of Preferred Stock (or,
following the occurrence of a Triggering Event, any other securities, cash
or assets, as the case may be) to, or in a name other than that of, the
registered holder upon the exercise of any Rights until any 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. Preferred Stock Record Date. Each Person in whose name
any certificate or depositary receipt for Units of Preferred Stock (or,
following the occurrence of a Triggering Event, other securities) is
issued upon the exercise of Rights shall for all purposes be deemed to
have become the holder of record of the Units of Preferred Stock (or,
following the occurrence of a Triggering Event, other securities)
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 any applicable transfer taxes) was
made; provided, however, that if the date of such surrender and payment is
a date upon which the Preferred Stock (or, following the occurrence of a
Triggering Event, other securities) transfer books of the Company are
closed, such Person shall be deemed to have become the record holder of
such securities on, and such certificate shall be dated, the next
succeeding Business Day on which the Preferred Stock (or, following the
occurrence of a Triggering Event, other securities) transfer books of the
Company are open and, further provided, however, that if delivery of Units
of Preferred Stock (or, following the occurrence of a Triggering Event,
other securities) is delayed pursuant to Section 9(c) or 11(a)(ii) hereof,
such Persons shall be deemed to have become the record holders of such
Units of Preferred Stock (or, following the occurrence of a Triggering
Event, other securities) only when such Units (or other securities) first
become deliverable. Prior to the exercise of the Rights evidenced
thereby, the holder of a Rights Certificate shall not be entitled to any
rights of a stockholder of the Company with respect to securities 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 securities
purchasable upon exercise of each Right and the number of Rights
outstanding are subject to adjustment from time to time as provided in
this Section 11.
(a) (i) In the event the Company shall at any time after
the date of this Agreement (A) declare a dividend on the Preferred
Stock payable in shares of Preferred Stock, (B) subdivide the
outstanding Preferred Stock, (C) combine the outstanding Preferred
Stock into a smaller number of shares, or (D) issue any shares of
its capital stock in a reclassification of the Preferred Stock
(including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing or
surviving corporation), except as otherwise provided in this Section
11(a), the Purchase Price in effect at the time of the record date
for such dividend or of the effective date of such subdivision,
combination or reclassification, and the number and kind of shares
of Preferred Stock or capital stock, as the case may be, issuable on
such date upon exercise of the Rights, 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 Preferred
Stock or capital stock, as the case may be, which, if such Right had
been exercised immediately prior to such date, such holder would
have owned upon such exercise and been entitled to receive by virtue
of such dividend, subdivision, combination or reclassification;
provided, however, that in no event shall the consideration to be
paid upon the exercise of one Right be less than the aggregate par
value of the shares of capital stock of the Company issuable upon
the exercise of one Right. 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) Subject to Section 34 hereof, in the event any Person
shall become an Acquiring Person (the first occurrence of such event
being a "Section 11(a)(ii) Event"), then (A) the Purchase Price
shall be adjusted to be the Purchase Price in effect immediately
prior to the Section 11(a)(ii) Event multiplied by the number of
Units of Preferred Stock for which a Right was exercisable
immediately prior to such Section 11(a)(ii) Event, whether or not
such Right was then exercisable, and (B) each holder of a Right,
except as otherwise provided in this Section 11(a)(ii) and Section
7(e) and Section 11(a)(iii) hereof, shall thereafter have the right
to receive, upon exercise thereof at a price equal to the Purchase
Price (as so adjusted), in accordance with the terms of this
Agreement, such number of Units of Preferred Stock as shall equal
the result obtained by dividing the Purchase Price (as so adjusted)
by 50% of the current per share market price of the Preferred Stock
(determined pursuant to Section 11(d) hereof) on the date of such
Section 11(a)(ii) Event (such Units of Preferred Stock being the
"Adjustment Shares"); provided, however, that the Purchase Price
(as so adjusted) and the number of Units of Preferred Stock so
receivable upon exercise of a Right shall, following the Section
11(a)(ii) Event, be subject to further adjustment as appropriate in
accordance with Section 11 hereof. Notwithstanding the foregoing,
the Rights shall not be exercisable pursuant to this Section
11(a)(ii) until the time period during which the Rights may be
redeemed pursuant to Section 23 hereof shall have expired.
(iii) The Company, by the vote of a majority of the Board of
Directors, may at its option substitute for a Unit of Preferred
Stock issuable upon the exercise of Rights in accordance with the
foregoing subparagraph (ii), shares of Company Common Stock or
fractions thereof having a current market price (as determined by
Section 11(d) hereof) equal to the current market price of a Unit of
Preferred Stock on the date of the Section 11(a)(ii) Event. In the
event that the number of shares of Preferred Stock which are
authorized by the Company's Restated Certificate of Incorporation
but not outstanding or reserved for issuance for purposes other than
upon exercise of the Rights is not sufficient to permit the exercise
in full of the Rights in accordance with the foregoing subparagraph
(ii) of this Section 11(a), the Company, by the vote of a majority
of the Board of Directors shall, to the extent permitted by
applicable law and any material agreements then in effect to which
the Company is a party: (A) determine the excess (such excess being
the "Spread") of (1) the aggregate value of the Adjustment Shares
issuable upon the exercise of a Right (the "Current Value") over
(2) the Purchase Price (as adjusted in accordance with the foregoing
subparagraph (ii)), and (B) with respect to each Right (other than
Rights which have become void pursuant to Section 7(e)), make
adequate provision to substitute, in whole or in part, for such
Adjustment Shares, upon exercise of a Right and payment of the
Purchase Price (as adjusted in accordance with the foregoing
subparagraph (ii)), (1) cash, (2) a reduction in the Purchase Price,
(3) shares of Company Common Stock or other equity securities of the
Company (including, without limitation, shares, or units of shares,
of preferred stock (such other shares being "common stock
equivalents")), (4) debt securities of the Company, (5) other
assets, or (6) any combination of the foregoing, having an aggregate
value which, when added to the value of the Units of Preferred Stock
actually issued upon exercise of such Right, shall have an aggregate
value equal to the Current Value (less the amount of any reduction
in such Purchase Price), where such aggregate value has been
determined by a majority of the Board of Directors, after receiving
advice from a nationally recognized investment banking firm;
provided, however, that if the Company shall not have made adequate
provision to deliver value pursuant to clause (B) above within
thirty (30) days following the later of (x) the first occurrence of
a Section 11(a)(ii) Event and (y) the date on which the Company's
right of redemption pursuant to Section 23(a) expires (the later of
(x) and (y) being referred to herein as the "Section 11(a)(iii)
Trigger Date"), then, subject to Section 34 hereof, the Company
shall be obligated (to the extent permitted by applicable law and
any material agreements then in effect to which the Company is a
party) to deliver, upon the surrender for exercise of a Right and
without requiring payment of the Purchase Price, Units of Preferred
Stock (to the extent available) and/or shares (or fractions of
shares, at the discretion of the Board) of Company Common Stock (to
the extent available), and then, if necessary, cash or a combination
thereof, which Units of Preferred Stock, shares (or fractions of
shares) of Company Common Stock and/or cash shall have an aggregate
value equal to the Spread. If, upon the occurrence of the Section
11(a)(ii) Event, a majority of the Board of Directors elects to
issue shares of Company Common Stock upon exercise of the Rights and
determines in good faith that it is likely that sufficient
additional shares of Company Common Stock could be authorized for
issuance upon exercise in full of the Rights, then, if a majority of
the Board of Directors so elects, 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)(iii) Trigger Date, in
order that the Company may seek stockholder approval for the
authorization of such additional shares (such thirty (30) day
period, as it may be extended, is herein called the "Substitution
Period"). To the extent that the Company determines that some
action need be taken pursuant to the second and/or third sentence of
this Section 11(a)(iii), the Company (x) shall provide, subject to
Section 7(e) hereof and the last sentence of this subparagraph
(iii), that such action shall apply uniformly to all outstanding
Rights and (y) may suspend the exercisability of the Rights until
the expiration of the Substitution Period in order to seek any
authorization of additional shares and/or to decide the appropriate
form of distribution to be made pursuant to such second sentence and
to determine the value thereof. For purposes of this Section
11(a)(iii), the value of a Unit of Preferred Stock or share of
Company Common Stock shall be the current market price (as
determined pursuant to Section 11(d) hereof) per Unit of Preferred
Stock or share of Company Common Stock, as the case may be, on the
Section 11(a)(iii) Trigger Date and the value of any common stock
equivalent shall be deemed to have the same value as a share of
Company Common Stock on such date. A majority of the Board of
Directors of the Company may, but shall not be required to,
establish procedures to allocate the right to receive Units of
Preferred Stock or shares of Company Common Stock, as the case may
be, upon the exercise of the Rights among holders of Rights pursuant
to this Section 11(a)(iii).
(b) In case the Company shall fix a record date for the
issuance of rights, options or warrants to all holders of Preferred
Stock entitling them to subscribe for or purchase (for a period
expiring within forty-five calendar days after such record date)
shares of Preferred Stock (or shares having substantially the same
rights, privileges and preferences as shares of Preferred Stock
("Equivalent Preferred Stock")) or securities convertible into
Preferred Stock or Equivalent Preferred Stock at a price per share
of Preferred Stock or per share of Equivalent Preferred Stock (or
having a conversion price per share, if a security convertible into
Preferred Stock or Equivalent Preferred Stock) less than the current
market price (as determined pursuant to Section l1(d) hereof) per
share of Preferred Stock on such record date, the Purchase Price to
be in effect after such record date shall be determined by
multiplying the Purchase Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the sum
of the number of shares of Preferred Stock outstanding on such
record date plus the number of shares of Preferred Stock which the
aggregate offering price of the total number of shares of Preferred
Stock and/or Equivalent Preferred Stock so to be offered (and/or the
aggregate initial conversion price of the convertible securities so
to be offered) would purchase at such current market price, and the
denominator of which shall be the number of shares of Preferred
Stock outstanding on such record date plus the number of additional
shares of Preferred Stock and/or Equivalent Preferred Stock to be
offered for subscription or purchase (or into which the convertible
securities so to be offered are initially convertible) provided,
however, that in no event shall the consideration to be paid upon
the exercise of one Right be less than the aggregate par value of
the shares of capital stock of the Company issuable upon exercise of
one Right. 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 a majority of the Board of Directors, whose determination
shall be described in a statement filed with the Rights Agent and
shall be binding on the Rights Agent and the holders of the Rights.
Shares of Preferred Stock owned by or held for the account of the
Company shall not be deemed outstanding for the purpose of any such
computation. Such 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 shares of Preferred Stock (including
any such distribution made in connection with a consolidation or
merger in which the Company is the continuing or surviving
corporation) of evidences of indebtedness, cash (other than a
regular quarterly cash dividend paid out of funds legally available
therefor), assets (other than a dividend payable in shares of
Preferred Stock, but including any dividend payable in stock other
than Preferred Stock) or subscription rights, options 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 (as determined pursuant to Section 11(d)
hereof) per share of Preferred Stock on such record date less the
fair market value (as determined in good faith by a majority of the
Board of Directors, whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the
Rights Agent and the holder of the Rights) of the cash, assets or
evidences of indebtedness so to be distributed or of such
subscription rights, options or warrants distributable in respect of
a share of Preferred Stock and the denominator of which shall be
such current market price (as determined pursuant to Section 11(d)
hereof) per share of Preferred Stock provided, however, that in no
event shall the consideration to be paid upon the exercise of one
Right be less than the aggregate par value of the shares of capital
stock of the Company to be issued upon exercise of one Right. Such
adjustments shall be made successively whenever such a record date
is fixed, and in the event that such distribution is not so made,
the 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) (i) For the purpose of any computation hereunder, the
"current market price" per share of Company Common Stock or Common
Stock on any date shall be deemed to be the average of the daily
closing prices per share of such shares for the ten consecutive
Trading Days (as such term is hereinafter defined) immediately prior
to such date; provided, however, if prior to the expiration of such
requisite ten Trading Day period the issuer announces either (A) a
dividend or distribution on such shares payable in such shares or
securities convertible into such shares (other than the Rights), or
(B) any subdivision, combination or reclassification of such shares,
then, following the ex-dividend date for such dividend or the record
date for such subdivision, combination or reclassification, as the
case may be, the "current market price" shall be properly adjusted
to take into account such event. The closing price for each day
shall be, if the shares are listed and admitted to trading on a
national securities exchange, as reported in the principal
consolidated transaction reporting system with respect to securities
listed on the principal national securities exchange on which such
shares are listed or admitted to trading or, if such shares 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 Stock Market ("Nasdaq") or such other system then in
use, or, if on any such date such shares 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 such
shares selected by a majority of the Board of Directors. If on any
such date no market maker is making a market in such shares, the
fair value of such shares on such date as determined in good faith
by a majority of the Board of Directors shall be used. If such
shares are not publicly held or not so listed or traded, "current
market price" per share shall mean the fair value per share as
determined in good faith by a majority of the Board of Directors,
whose determination shall be described in a statement filed with the
Rights Agent and shall be conclusive for all purposes. The term
"Trading Day" shall mean, if such shares are listed or admitted to
trading on any national securities exchange, a day on which the
principal national securities exchange on which such shares are
listed or admitted to trading is open for the transaction of
business or, if such shares are not so listed or admitted, a
Business Day.
(ii) For the purpose of any computation hereunder, the
"current market price" per share of Preferred Stock shall be
determined in the same manner as set forth above for Company Common
Stock in subparagraph (i) of this Section 11(d) (other than the
fourth sentence thereof). If the current market price per share of
Preferred Stock cannot be determined in the manner provided above or
if the Preferred Stock is not publicly held or listed or traded in a
manner described in subparagraph (i) of this Section 11(d), the
"current market price" per share of Preferred Stock shall be
conclusively deemed to be an amount equal to 1,000 (as such amount
may be appropriately adjusted for such events as stock splits, stock
dividends and recapitalizations with respect to Company Common Stock
occurring after the date of this Agreement) multiplied by the
current market price per share of Company Common Stock. If neither
Company Common Stock nor Preferred Stock is publicly held or so
listed or traded, "current market price" per share of the
Preferred Stock shall mean the fair value per share as determined in
good faith by a majority of the Board of Directors whose
determination shall be described in a statement filed with the
Rights Agent and shall be binding on the Rights Agent and the
holders of the Rights. For all purposes of this Agreement, the
"current market price" of a Unit of Preferred Stock shall be equal
to the "current market price" of one share of Preferred Stock
divided by 1,000.
(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 1% in
the Purchase Price; provided, however, that any adjustments which by
reason of this Section 11(e) are not required to be made shall be
carried forward and taken into account in any subsequent adjustment.
All calculations under this Section 11 shall be made to the nearest
cent or to the nearest one hundred-thousandth of a share of
Preferred Stock, Company Common Stock or Common Stock or other share
or security, as the case may be. Notwithstanding the first sentence
of this Section 11(e), any adjustment required by this Section 11
shall be made no later than the earlier of (i) three years from the
date of the transaction which mandates such adjustment and (ii) the
Expiration Date.
(f) If as a result of an adjustment made pursuant to Section
11(a) or 13(a) hereof, the holder of any Right thereafter exercised
shall become entitled to receive any shares of capital stock other
than Preferred Stock, thereafter the number of such other shares so
receivable upon exercise of any Right and the Purchase Price thereof
shall be subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions with
respect to the Preferred Stock contained in Sections 11(a), (b),
(c), (e), (g), (h), (i), (k), (l) and (m), and the provisions of
Sections 7, 9, 10, 13 and 14 hereof with respect to the Preferred
Stock shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to
any adjustment made to the Purchase Price hereunder shall evidence
the right to purchase, at the adjusted Purchase Price, the number of
Units of Preferred Stock (or other securities or amount of cash or
combination thereof) that may be acquired 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 Units of Preferred Stock
(calculated to the nearest one hundred-thousandth of a Unit)
obtained by (i) multiplying (x) the number of Units of Preferred
Stock covered by a Right immediately prior to such 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 Units of Preferred Stock
that may be acquired upon the exercise of a Right. Each of the
Rights outstanding after the adjustment in the number of Rights
shall be exercisable for the number of Units of Preferred Stock for
which a Right was exercisable immediately prior to such adjustment.
Each Right held of record prior to such adjustment of the number of
Rights shall become that number of Rights (calculated to the nearest
one 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 days later than
the date of such public announcement. If Rights Certificates have
been issued, upon each adjustment of the number of Rights pursuant
to this Section 11(i), the Company shall, as promptly as
practicable, cause to be distributed to holders of record of Rights
Certificates on such record date Rights Certificates evidencing,
subject to Section 14 hereof, the additional Rights to which such
holders shall be entitled as a result of such adjustment, or, at the
option of the Company, shall cause to be distributed to such holders
of record in substitution and replacement for the Rights
Certificates held by such holders prior to the date of adjustment,
and upon surrender thereof, if required by the Company, new Rights
Certificates evidencing all the Rights to which such holders shall
be entitled after such adjustment. Rights Certificates to be so
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 Units of Preferred Stock issuable upon the
exercise of the Rights, the Rights Certificates theretofore and
thereafter issued may continue to express the Purchase Price per
Unit and the number of Units of Preferred Stock 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 par value of the Units of
Preferred Stock or other shares of capital stock issuable upon
exercise of the Rights, the Company shall take any corporate action
which may, in the opinion of its counsel, be necessary in order that
the Company may validly and legally issue such fully paid and non-
assessable Units of Preferred Stock or other such shares at such
adjusted Purchase Price.
(1) 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 that number of Units of
Preferred Stock and shares of other capital stock or securities of
the Company, if any, issuable upon such exercise over and above the
number of Units of Preferred Stock and shares of 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
reductions in the Purchase Price, in addition to those adjustments
expressly required by this Section 11, as and to the extent that in
their good faith judgment a majority of the Board of Directors shall
determine to be advisable in order that any (i) consolidation or
subdivision of the Preferred Stock, (ii) issuance wholly for cash of
any shares of Preferred Stock at less than the current market price,
(iii) issuance wholly for cash of shares of Preferred Stock or
securities which by their terms are convertible into or exchangeable
for shares of Preferred Stock, (iv) stock dividends or (v) issuance
of rights, options or warrants referred to in this Section 11,
hereafter made by the Company to holders of its Preferred Stock,
shall not be taxable to such holders or shall reduce the taxes
payable by such holders.
(n) The Company shall not, at any time after the Distribution
Date, (i) consolidate with any other Person, (ii) merge with or into
any other Person, or (iii) sell or transfer (or permit any
Subsidiary to sell or transfer), in one transaction, or a series of
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 wholly owned 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
or sale there are any rights, warrants or other instruments or
securities outstanding or agreements in effect which would
substantially diminish or otherwise eliminate the benefits intended
to be afforded by the Rights or (y) prior to, simultaneously with or
immediately after such consolidation, merger or sale, the Person
which constitutes, or would constitute, the "Principal Party" for
purposes of Section 13(a) hereof shall have distributed or otherwise
transferred to its shareholders or other persons holding an equity
interest in such Person Rights previously owned by such Person or
any of its Affiliates and Associates; provided, however, this
Section 11(n) shall not affect the ability of any wholly owned
Subsidiary of the Company to consolidate with, merge with or into,
or sell or transfer assets or earning power to, any other wholly
owned Subsidiary of the Company.
(o) After the Distribution Date, the Company shall not,
except as permitted by Section 23, Section 26 or Section 34 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 Company Common Stock payable in shares of Company Common Stock,
(ii) subdivide the outstanding shares of Company Common Stock, (iii)
combine the outstanding shares of Company Common Stock into a
smaller number of shares, or (iv) issue any shares of its capital
stock in a reclassification of Company Common Stock (including any
such reclassification in connection with a consolidation or merger
in which the Company is the continuing or surviving corporation),
the number of Rights associated with each share of Company Common
Stock then outstanding, or issued or delivered thereafter prior to
the Distribution Date or in accordance with Section 22 hereof, shall
be proportionately adjusted so that the number of Rights thereafter
associated with each share of Company Common Stock following any
such event shall equal the result obtained by multiplying the number
of Rights associated with each share of Company Common Stock
immediately prior to such event by a fraction the numerator of which
shall be the total number of shares of Company Common Stock
outstanding immediately prior to the occurrence of the event and the
denominator of which shall be the total number of shares of Company
Common Stock outstanding immediately following the occurrence of
such event.
Section 12. Certificate of Adjusted Purchase Price or Number of
Shares. Whenever an adjustment is made as provided in Section 11 or
Section 13 hereof, the Company shall (a) promptly prepare a certificate
setting forth such adjustment and a brief statement of the facts
accounting for such adjustment, (b) promptly file with the Rights Agent,
and with each transfer agent for the Preferred Stock and the Company
Common Stock, 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
Company Common Stock) in accordance with Section 25 hereof. 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 that, following the first occurrence of a
Section 11(a)(ii) Event, directly or indirectly, either (x) the Company
shall consolidate with, or merge with and into, any other Person, and the
Company shall not be the continuing or surviving corporation of such
consolidation or merger, (y) any Person shall consolidate with, or merge
with or into, the Company, and the Company shall be the continuing or
surviving corporation of such consolidation or merger and, in connection
with such consolidation or merger, all or part of the outstanding shares
of Company Common Stock shall be changed into or exchanged for stock or
other securities of the Company or any other Person 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) to any Person
or Persons (other than the Company or any of its wholly owned Subsidiaries
in one or more transactions each of which complies with Section 11(o)
hereof), in one or more transactions, assets or earning power aggregating
50% or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) (any such event being a "Section 13
Event"), then, and in each such case, proper provision shall be made so
that: (i) each holder of a Right (other than Rights which have become void
as provided in Section 7(e) hereof), shall thereafter have the right to
receive, upon the exercise thereof at the Purchase Price (as theretofore
adjusted in accordance with Section 11(a)(ii) hereof), in accordance with
the terms of this Agreement and in lieu of Units of Preferred Stock or
shares of Company Common Stock, such number of validly authorized and
issued, fully paid, non-assessable and freely tradeable shares of Common
Stock of the Principal Party (as such term is hereinafter defined), which
shares shall not be subject to any liens, encumbrances, rights of call or
first refusal, transfer restrictions or other adverse claims, as shall be
equal to the result obtained by dividing the Purchase Price (as
theretofore adjusted in accordance with Section 11(a)(ii) hereof) by 50%
of the current market price (determined pursuant to Section 11(d) hereof)
per share of the Common Stock of such Principal Party on the date of
consummation of such Section 13 Event; provided, however, that the
Purchase Price (as theretofore adjusted in accordance with Section
11(a)(ii) hereof) and the number of shares of Common Stock of such
Principal Party so receivable upon exercise of a Right shall be subject to
further adjustment as appropriate in accordance with Section 11(f) hereof
to reflect any events occurring in respect of the Common Stock of such
Principal Party after the occurrence 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 in all respects;
(iv) such Principal Party shall take such steps (including, but not
limited to, the reservation of a sufficient number of shares of its Common
Stock in accordance with Section 9 hereof) in connection with the
consummation of any such transaction as may be necessary to assure that
the provisions of this Agreement 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 to its shares of Common Stock;
provided, however, that, upon the subsequent occurrence of any merger,
consolidation, sale of all or substantially all of the assets,
recapitalization, reclassification of shares, reorganization or other
extraordinary transaction in respect of such Principal Party, each holder
of a Right shall thereupon be entitled to receive, upon exercise of a
Right and payment of the Purchase Price, such cash, shares, rights,
warrants and other property which such holder would have been entitled to
receive had it, at the time of such transaction, owned the shares of
Common Stock of the Principal Party purchasable upon the exercise of a
Right, and such Principal Party shall take such steps (including, but not
limited to, reservation of shares of stock) as may be necessary to permit
the subsequent exercise of the Rights in accordance with the terms hereof
for such cash, shares, rights, warrants and other property; and (v) the
provisions of Section 11(a)(ii) hereof shall be of no further effect
following the first occurrence of any Section 13 Event.
(b) "Principal Party" shall mean:
(i) in the case of any transaction described in clause
(x) or (y) of the first sentence of Section 13(a) hereof, (A)
the Person that is the issuer of any securities into which
shares of Company Common Stock are converted in such merger or
consolidation, or, if there is more than one such issuer, the
issuer of Common Stock that has the highest aggregate current
market price (determined pursuant to Section 11(d) hereof) and
(B) if no securities are so issued, the Person that is the
other party to such merger or consolidation, or, if there is
more than one such Person, the Person the Common Stock of
which has the highest aggregate current market price
(determined pursuant to Section 11(d) hereof); 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 largest portion of the assets or
earning power transferred pursuant to such transaction or
transactions, or, if each Person that is a party to such
transaction or transactions receives the same portion of the
assets or earning power transferred pursuant to such
transaction or transactions or if the Person receiving the
largest portion of the assets or earning power cannot be
determined, whichever Person the Common Stock of which has the
highest aggregate current market price (determined pursuant to
Section 11(d) hereof); 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 twelve-
month period registered under Section 12 of the Exchange Act
("Registered Common Stock"), or such Person is not a
corporation, and such Person is a direct or indirect
Subsidiary of another Person that has Registered Common Stock
outstanding, "Principal Party" shall refer to such other
Person; (2) if the Common Stock of such Person is not
Registered Common Stock or such Person is not a corporation,
and such Person is a direct or indirect Subsidiary of another
Person but is not a direct or indirect Subsidiary of another
Person which has Registered Common Stock outstanding,
"Principal Party" shall refer to the ultimate parent entity
of such first-mentioned Person; (3) if the Common Stock of
such Person is not Registered Common Stock or such Person is
not a corporation, and such Person is directly or indirectly
controlled by more than one Person, and one or more of such
other Persons has Registered Common Stock outstanding,
"Principal Party" shall refer to whichever of such other
Persons is the issuer of the Registered Common Stock having
the highest aggregate current market price (determined
pursuant to Section 11(d) hereof); and (4) if the Common Stock
of such Person is not Registered Common Stock or such Person
is not a corporation, and such Person is directly or
indirectly controlled by more than one Person, and none of
such other Persons have Registered Common Stock outstanding,
"Principal Party" shall refer to whichever ultimate parent
entity is the corporation having the greatest shareholders
equity or, if no such ultimate parent entity is a corporation,
shall refer to whichever ultimate parent entity is the entity
having the greatest net assets.
(c) The Company shall not consummate any such consolidation,
merger, sale or transfer unless the Principal Party shall have a
sufficient number of authorized shares of its Common Stock which
have not been issued or reserved for issuance to permit the exercise
in full of the Rights in accordance with this Section 13, and unless
prior thereto the Company and such Principal Party shall have
executed and delivered to the Rights Agent a supplemental agreement
providing for the terms set forth in paragraphs (a) and (b) of this
Section 13 and further providing that the Principal Party, at its
own expense, shall:
(i) (A) file on an appropriate form, as soon as
practicable following the execution of such agreement, a
registration statement under the Securities Act with respect
to the Common Stock that may be acquired upon exercise of the
Rights, (B) cause such registration statement to remain
effective (and to include a prospectus complying with the
requirements of the Securities Act) until the Expiration Date,
and (C) as soon as practicable following the execution of such
agreement, take such action as may be required to assure that
any acquisition of such Common Stock upon the exercise of the
Rights complies with any applicable state securities or "blue
sky" laws; and
(ii) as soon as practicable following the execution of
such agreement, deliver to holders of the Rights historical
financial statements for the Principal Party and each of its
Affiliates which comply in all respects with the requirements
for registration on Form 10 under the Exchange Act.
(d) In case the Principal Party which is to be a party to a
transaction referred to in this Section 13 has a provision in any of
its authorized securities or in its certificate of incorporation or
bylaws or other instrument governing its corporate affairs, which
provision would have the effect of (i) causing such Principal Party
to issue, in connection with, or as a consequence of, the
consummation of a transaction referred to in this Section 13, shares
of Common Stock of such Principal Party at less than the then
current market price per share (determined pursuant to Section 11(d)
hereof) or securities exercisable for, or convertible into, Common
Stock of such Principal Party at less than such then current market
price (other than to holders of Rights pursuant to this Section 13)
or (ii) providing for any special payment, tax or similar provisions
in connection with the issuance of the Common Stock of such
Principal Party pursuant to the provisions of this Section 13; then,
in such event, the Company shall not consummate any such transaction
unless prior thereto the Company and such Principal Party shall have
executed and delivered to the Rights Agent a supplemental agreement
providing that the provision in question of such Principal Party
shall have been cancelled, waived or amended, or that the authorized
securities shall be redeemed, so that the applicable provision will
have no effect in connection with, or as a consequence of, the
consummation of the proposed transaction.
(e) 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 that have
not theretofore been exercised shall thereafter become exercisable
in a manner and for the securities described in Section 13(a).
Section 14. Fractional Rights and Fractional Shares. (a) The
Company shall not be required to issue fractions of Rights or to
distribute Rights Certificates which evidence fractional Rights. In lieu
of issuing such fractional Rights, there shall be paid to the Persons to
which such fractional Rights would otherwise be issuable, an amount in
cash equal to such fraction of the market value of a whole Right. For
purposes of this Section 14(a), the 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, if the
Rights are listed or admitted to trading on a national securities
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 Nasdaq or such other system then in use or, if on
any such date the Rights are not quoted by any such organization, the
average of the closing bid and asked prices as furnished by a professional
market maker making a market in the Rights selected by a majority of the
Board of Directors. If on any such date no such market maker is making a
market in the Rights, the fair value of the Rights on such date as
determined in good faith by a majority of the Board of Directors shall be
used and such determination shall be described in a statement filed with
the Rights Agent and the holders of the Rights.
(b) The Company shall not be required to issue fractions of
shares of Preferred Stock (other than fractions which are integral
multiples of one one-thousandth of a share of Preferred Stock) upon
exercise of the Rights or to distribute certificates which evidence such
fractional shares of Preferred Stock (other than fractions which are
integral multiples of one one-thousandth of a share of Preferred Stock);
provided, however, that in lieu of fractions of shares of Preferred Stock
which are integral multiples of one one-thousandth of a share of Preferred
Stock, the Company may provide for the issuance of depositary receipts
pursuant to Section 7(c) hereof. In lieu of such fractional shares of
Preferred Stock that are not integral multiples of one one-thousandth of a
share, 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 then current market price
of a share of Preferred Stock on the day of exercise, determined in
accordance with Section 11(d) hereof.
(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. All rights of action in respect of
this Agreement, other than 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 certificates representing shares of Company
Common Stock); and any registered holder of a Rights Certificate (or,
prior to the Distribution Date, of a certificate representing shares of
Company Common Stock), without the consent of the Rights Agent or of the
holder of any other Rights Certificate (or, prior to the Distribution
Date, of a certificate representing shares of Company Common Stock), may,
in his own behalf and for his own benefit, enforce, and may institute and
maintain any suit, action or proceeding against the Company or any other
Person 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 will be
transferable only in connection with the transfer of Company Common
Stock;
(b) after the Distribution Date, the Rights Certificates are
transferable only on the registry books of the Rights Agent if
surrendered at the office 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 duly
executed;
(c) subject to Section 6(a) and Section 7(f) hereof, the
Company and the Rights Agent may deem and treat the person in whose
name a Rights Certificate (or, prior to the Distribution Date, the
associated Company 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 Company 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
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 any other Person as a result
of its inability to perform any of its obligations under this
Agreement by reason of any preliminary or permanent injunction or
other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative
agency or commission, or 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
promptly as practicable.
Section 17. Rights Certificate Holder Not Deemed a Stockholder. 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 Preferred Stock or any other securities of the Company which may
at any time be issuable on the exercise of the Rights represented thereby,
nor shall anything contained herein or in any Rights Certificate be
construed to confer upon the holder of any Rights Certificate, as such,
any of the rights of a stockholder of the Company or any right to vote for
the election of directors or upon any matter submitted to stockholders at
any meeting thereof, or to give or withhold consent to any corporate
action, or, except as provided in Section 24 hereof, to receive notice of
meetings or other actions affecting stockholders, 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. This Section 17 shall also apply to holders, as
such, of Rights prior to the issuance of Rights Certificates.
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, including reasonable fees and disbursements of its
counsel, incurred in connection with the execution and administration of
this Agreement and the exercise and performance of its duties hereunder.
The Company shall indemnify the Rights Agent for, and 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 reasonable costs and
expenses of defending against any claim of liability hereunder.
(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 Preferred Stock or for other
securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement or other paper or document believed by it to be
genuine and to have been signed, executed and, where necessary, verified
or acknowledged by the proper Person or Persons.
Section 19. Merger or Consolidation or Change of Name of Rights
Agent. (a) Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the corporate trust or shareholder services businesses 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 document or any further act on the part of any of the parties hereto;
provided, however, that such corporation would be eligible for appointment
as a successor Rights Agent under the provisions of Section 21 hereof. In
case 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 in case 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) In case 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 "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 specified herein) may be deemed to be
conclusively proved and established by a certificate signed by the
Chairman, the Vice Chairman, the Chief Executive Officer, the
President, the Chief Financial Officer, any Vice President, the
Treasurer, any Assistant Treasurer, the Secretary or any Assistant
Secretary of the Company and delivered to the Rights Agent;
provided, however, that so long as any Person is an Acquiring Person
hereunder, such certificate shall be signed and delivered by a
majority of the Board of Directors; and such certificate shall be
full authorization to the Rights Agent for any action taken or
suffered in good faith by it under the provisions of this Agreement
in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its
own 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 or 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 have any responsibility for
the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or for the
validity or execution of any Rights Certificate (except its
countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or failure by the Company to
satisfy conditions 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 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 by the Rights Agent of the certificate
describing any such adjustment contemplated by Section 12); 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
Preferred Stock or any other securities to be issued pursuant to
this Agreement or any Rights Certificate or as to whether any shares
of Preferred Stock or any other securities will, when so issued, be
validly authorized and issued, fully paid and non-assessable.
(f) The Company shall perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and
delivered all such further acts, instruments and assurances as may
reasonably be required by the Rights Agent for the performance by
the Rights Agent of its duties under 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, the Vice Chairman, the Chief Executive
Officer, the President, the Chief Financial Officer, any Vice
President, the Secretary, any Assistant Secretary, the Treasurer or
any Assistant Treasurer of the Company, and to apply to such
officers for advice or instructions in connection with its duties,
and 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; provided, however, that so long as any Person is an
Acquiring Person hereunder, the Rights Agent shall accept such
instructions and advice only from a majority of the Board of
Directors and shall not be liable for any action taken or suffered
to be taken by it in good faith in accordance with such instructions
of a majority of the Board of Directors. 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 such 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 shareholder, director, officer
or employee of the Rights Agent may buy, sell or deal in any of the
Rights or other securities of the Company or have a pecuniary
interest 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.
(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 or in
the exercise of its rights hereunder if the Rights Agent shall have
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, not signed 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. If such certificate has been completed and signed and shows
a negative response to clauses 1 and 2 of such certificate, unless
previously instructed otherwise in writing by the Company (which
instructions may impose on the Rights Agent additional ministerial
responsibilities, but no discretionary responsibilities), the Rights
Agent may assume without further inquiry that the Rights Certificate
is not owned by a Person described in Section 7(e) hereof and shall
not be charged with any knowledge to the contrary.
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 days' prior notice in writing mailed to the
Company, and to each transfer agent of the Preferred Stock and the Company
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 days' prior notice
in writing, mailed to the Rights Agent or successor Rights Agent, as the
case may be, and to each transfer agent of the Preferred Stock and the
Company 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 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. 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 any state of the United States in good
standing, shall be authorized under applicable laws to exercise corporate
trust or stock transfer powers and shall be subject to supervision or
examination by federal or state authorities or (b) an Affiliate of a
corporation described in clause (a). After appointment, the successor
Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent
without further act or deed; but the predecessor Rights Agent shall
deliver and transfer to the successor Rights Agent any property at the
time held by it hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Not later than the
effective date of any such appointment, the Company shall file notice
thereof in writing with the predecessor Rights Agent and each transfer
agent of the Preferred Stock and the Company Common Stock, and mail a
notice thereof in writing to the registered holders of the Rights
Certificates. Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality or validity
of the resignation or removal of the Rights Agent or the appointment of
the successor Rights Agent.
Section 22. Issuance of New Rights Certificates. Notwithstanding
any of the provisions of this Agreement or the Rights to the contrary, the
Company may, at its option, issue new Rights Certificates evidencing
Rights in such form as may be approved by a majority of the Board of
Directors to reflect any adjustment or change made in accordance with the
provisions of this Agreement in the Purchase Price or the number or kind
or class of shares or other securities or property that may be acquired
under the Rights Certificates. In addition, in connection with the
issuance or sale of shares of Company Common Stock following the
Distribution Date and prior to the Expiration Date, the Company (a) shall,
with respect to shares of Company Common Stock 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 a majority of the Board of Directors,
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) Subject to Section 30
hereof, the Company may, at its option, by action of a majority of the
Board of Directors, at any time prior to the earlier of (i) the Close of
Business on the tenth Business Day following the Stock Acquisition Date or
(ii) the Final Expiration Date, 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 the "Redemption Price"). The Company may, at its
option, by action of a majority of the Board of Directors, pay the
Redemption Price either in shares of Company Common Stock (based on the
"current market price", as defined in Section 11(d) hereof, of the
shares of Company Common Stock at the time of redemption) or cash and the
redemption of the Rights shall be effective on the basis and with such
conditions as the Board of Directors may in its sole discretion establish.
(b) Immediately upon the action of a majority of the Board of
Directors ordering the redemption of the Rights, evidence of which shall
be 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. The Company shall promptly give
public notice of any such redemption; provided, however, that the failure
to give, or any defect in, any such notice shall not affect the validity
of such redemption. Promptly after the action of a majority of the Board
of Directors ordering the redemption of the Rights, the Company shall give
notice of such redemption to the Rights Agent and the holders of the then
outstanding Rights by mailing such notice to 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 Company 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 Preferred Stock
or to make any other distribution to the holders of Preferred Stock (other
than a regular quarterly cash dividend paid out of funds legally available
therefor), (ii) to offer to the holders of Preferred Stock rights or
warrants to subscribe for or to purchase any additional shares of
Preferred Stock or shares of stock of any class or any other securities,
rights or options, (iii) to effect any reclassification of its Preferred
Stock (other than a reclassification involving only the subdivision of
outstanding shares of Preferred Stock), (iv) to effect any consolidation
or merger into or with any other Person, or to effect any sale or other
transfer (or to permit one or more of its Subsidiaries to effect any sale
or other transfer), in one or more transactions, of more than 50% of the
assets or earning power of the Company and its Subsidiaries (taken as a
whole) to any other Person or Persons (other than a transfer by the
Company and/or any of its wholly owned Subsidiaries in one or more
transactions each of which complies with Section 11(o) hereof), or (v) to
effect the liquidation, dissolution or winding up of the Company, then, in
each such case, the Company shall give to each holder of a Rights
Certificate, to the extent feasible and in accordance with Section 25
hereof, a notice of such proposed action, which shall specify the record
date for the purposes of such stock dividend, distribution of rights or
warrants, or the date on which such reclassification, consolidation,
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 Preferred Stock, if any such date is to be fixed, and such notice shall
be so given in the case of any action covered by clause (i) or (ii) above
at least twenty (20) days prior to the record date for determining holders
of the shares of Preferred Stock for purposes of such action, and in the
case of any such other action, at least twenty (20) days prior to the date
of the taking of such proposed action or the date of participation therein
by the holders of the shares of Preferred Stock whichever shall be the
earlier; provided, however, no such notice shall be required pursuant to
this Section 24, if any wholly owned Subsidiary of the Company effects a
consolidation or merger with or into, or effects a sale or other transfer
of assets or earnings power to, any other wholly owned Subsidiary of the
Company.
(b) In case any Triggering Event shall occur, then, in any such
case, (i) 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) or Section 13 hereof, as the case may be.
Section 25. Notices. All notices and other communications provided
for hereunder shall, unless otherwise stated herein, be in writing
(including by telex, telegram or cable) and mailed or sent or delivered,
if to the Company, at its address at:
Uniphase Corporation
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
and if to the Rights Agent, at its address at:
American Stock Transfer & Trust Company
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
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 Company Common Stock) shall be sufficiently given
or made if sent by first-class mail, postage prepaid, addressed to such
holder at the address of such holder as shown on the registry books of the
Company.
Section 26. Supplements and Amendments. For so long as the Rights
are then redeemable, and, subject to the penultimate sentence of this
Section 26, the Company may, in its sole and absolute discretion, and the
Rights Agent shall, if the Company so directs, supplement or amend any
provision of this Agreement in any respect without the approval of any
holders of certificates representing Rights or shares of Company Common
Stock. From and after the time that the Rights are no longer redeemable
and subject to the penultimate sentence of this Section 26, the Company
and the Rights Agent shall, if the Company so directs, supplement or amend
this Agreement without the approval of any holders of Rights Certificates
in order (i) to cure any ambiguity, (ii) to correct or supplement any
provision contained herein which may be defective or inconsistent with any
other provisions herein, (iii) to shorten or lengthen any time period
hereunder, or (iv) to change or supplement the provisions hereunder in any
manner which the Company may deem necessary or desirable and which shall
not adversely affect the interests of the holders of Rights Certificates
(other than an Acquiring Person or an Affiliate or Associate of an
Acquiring Person); provided, however, that this Agreement may not be
supplemented or amended to lengthen, pursuant to clause (iii) of this
sentence, (A) subject to Section 30 hereof, a time period relating to when
the Rights may be redeemed at such time as the Rights are not then
redeemable, or (B) any other time period unless such lengthening is for
the purpose of protecting, enhancing or clarifying the rights of, and/or
the benefits to, the holders of Rights. Upon the delivery of a certificate
from an appropriate officer of the Company or, so long as any Person is an
Acquiring Person hereunder, from the majority of the Board of Directors
which states that the proposed supplement or amendment is in compliance
with the terms of this Section 26, the Rights Agent shall execute such
supplement or amendment. Notwithstanding anything contained in this
Agreement to the contrary, (i) no supplement or amendment shall be made
which changes the Redemption Price, the Purchase Price, the Expiration
Date or the number of Units of Preferred Stock or other securities or
assets for which a Right is exercisable without the approval of a majority
of the Board of Directors, and (ii) following the occurrence of a
Section 11(a)(ii) Event, no supplement or amendment whatsoever shall be
made without the approval of the Board of Directors. Prior to the
Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Company Common Stock.
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 of Directors,
etc. For all purposes of this Agreement, any calculation of the number of
shares of Company Common Stock outstanding at any particular time,
including for purposes of determining the particular percentage of such
outstanding shares of Company Common Stock 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 Exchange Act Regulations as in effect on the
date hereof. Except as otherwise specifically provided herein, the Board
of Directors of the Company shall have the exclusive power and authority
to administer this Agreement and to exercise all rights and powers
specifically granted to the Board of Directors or to the Company, or as
may be necessary or advisable in the administration of this Agreement,
including, without limitation, the right and power (i) to interpret the
provisions of this Agreement, and (ii) to make all determinations deemed
necessary or advisable for the administration of this Agreement. All such
actions, calculations, interpretations and determinations (including, for
purposes of clause (y) below, all omissions with respect to the foregoing)
which are done or made by the Board of Directors in good faith shall (x)
be final, conclusive and binding on the Company, the Rights Agent, the
holders of the Rights and all other parties, and (y) not subject the Board
of Directors or any member thereof to any liability to the holders of the
Rights.
Section 29. Benefits of this Agreement. Nothing in this Agreement
shall be construed to give to any Person other than the Company, the
Rights Agent and the registered holders of the Rights Certificates (and,
prior to the Distribution Date, registered holders of shares of Company
Common Stock) 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
shares of Company Common Stock).
Section 30. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction
or other authority to be invalid, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions of this Agreement shall
remain in full force and effect and shall in no way be affected, impaired
or invalidated; provided, however, that notwithstanding anything in this
Agreement to the contrary, if any such term, provision, covenant or
restriction is held by such court or authority to be invalid, void or
unenforceable and a majority of the Board of Directors determines in its
good faith judgment that severing the invalid language from this Agreement
would adversely affect the purpose or effect of this Agreement and the
Rights shall not then be redeemable, 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 a majority of the Board of Directors.
Section 31. Governing Law. This Agreement, each Right and each
Rights Certificate issued hereunder shall be governed by, and construed in
accordance with, the laws of the State of Delaware applicable to contracts
executed in and to be performed entirely in such State.
Section 32. Counterparts. This Agreement may be executed
(including by facsimile) in one or more counterparts, and by the different
parties hereto in separate counterparts, each of which when executed shall
be deemed to be an original, but all of which taken together shall
constitute one and the same instrument.
Section 33. Descriptive Headings. The headings contained in this
Agreement are for descriptive purposes only and shall not affect in any
way the meaning or interpretation of this Agreement.
Section 34. Exchange. (a) The Company, upon resolution of a
majority of the Board of Directors may, at its option, at any time after
the first occurrence of a Section 11(a)(ii) Event, exchange all or part of
the then outstanding and exercisable Rights (which shall not include
Rights that have become void pursuant to Section 7(e) hereof) for Units of
Preferred Stock or shares of Company Common Stock (at the election of the
Board of Directors at an exchange ratio of one Unit of Preferred Stock or
one share of Company Common Stock, as the case may be, per Right, as
appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (such exchange ratio
being the "Exchange Ratio"). Notwithstanding the foregoing, the Board
of Directors shall not be empowered to effect such exchange at any time
after any Person (other than an Exempt Person), together with all
Affiliates and Associates of such Person, becomes the Beneficial Owner of
shares of Company Common Stock aggregating 50% or more of the shares of
Company Common Stock then outstanding. From and after the occurrence of a
Section 13(a) Event, any Rights that theretofore have not been exchanged
pursuant to this Section 34(a) shall thereafter be exercisable only in
accordance with Section 13 and may not be exchanged pursuant to this
Section 34(a). The exchange of the Rights by the Board of Directors may
be made effective at such time, on such basis and with such conditions as
the Board of Directors in its sole discretion may establish.
(b) Immediately upon the action of a majority of the Board of
Directors ordering the exchange of any Rights pursuant to Section 34(a)
and without any further action and without any notice, the right to
exercise such Rights shall terminate and the only right thereafter of a
holder of such Rights shall be to receive that number of Units of
Preferred Stock or shares of Company Common Stock, as the case may be,
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. 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 shall state the method by which the
exchange of Units of Preferred Stock or shares of Company Common Stock, as
the case may be, 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 the number of shares of Preferred Stock or
Company Common Stock, as the case may be, which are authorized by the
Company's Restated Certificate of Incorporation but not outstanding or
reserved for issuance for purposes other than upon exercise of the Rights
are not sufficient to permit any exchange of Rights as contemplated in
accordance with this Section 34, the Company, upon a resolution of a
majority of the Board of Directors, shall take all such action as may be
necessary to authorize additional shares of Preferred Stock or Company
Common Stock, as the case may be, for issuance upon exchange of the Rights
or make adequate provision to substitute, in whole or in part, (1) cash,
(2) other equity securities of the Company, (3) debt securities of the
Company, (4) other assets, or (5) any combination of the foregoing, having
an aggregate value for each Right to be exchanged equal to the per share
market price of one Unit of Preferred Stock or share of Company Common
Stock, as the case may be (determined pursuant to Section 11(d) hereof) as
of the date of a Section 11(a)(ii) Event, where such aggregate value has
been determined by a majority of the Board of Directors.
(d) The Company shall not be required to issue fractions of
Units of Preferred Stock or fractions of shares of Company Common Stock or
to distribute certificates which evidence fractional Units or fractional
shares. In lieu of issuing fractional Units or fractional shares, the
Company may pay to the registered holders of Rights Certificates at the
time such Rights are exchanged as herein provided an amount in cash equal
to the same fraction of the current market price (determined pursuant to
Section 11(d) hereof) of one Unit of Preferred Stock or one share of
Company Common Stock, as the case may be, on the Trading Day immediately
prior to the date of exchange pursuant to this Section 34
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, all as of the date first above written.
Attest: UNIPHASE CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Secretary President and Chief Executive Officer
Attest: AMERICAN STOCK TRANSFER &
TRUST COMPANY
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
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Title: Account Administrator Title: Vice President
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