GENERAL SIGNAL CORPORATION
and
First Chicago Trust Company of New York, Rights Agent
RIGHTS AGREEMENT
Dated as of February 1, 1996
TABLE OF CONTENTS
Page
RIGHTS AGREEMENT
Section 1. Certain Definitions . . . . . . . . . . . . . 1
Section 2. Appointment of Rights Agent . . . . . . . . . 7
Section 3. Issue of Right Certificates . . . . . . . . . 7
Section 4. Form of Right Certificates. . . . . . . . . . 9
Section 5. Countersignature and Registration . . . . . . 11
Section 6. Transfer, Split Up, Combination and
Exchange of Right Certificates;
Mutilated, Destroyed, Lost or Stolen
Right Certificates. . . . . . . . . . . . . . 12
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights . . . . . . . . . . 13
Section 8. Cancellation and Destruction of
Right Certificates. . . . . . . . . . . . . . 15
Section 9. Reservation and Availability of
Shares of Common Stock. . . . . . . . . . . . 16
Section 10. Common Stock Record Date. . . . . . . . . . . 18
Section 11. Adjustment of Purchase Price, Number
of Shares or Number of Rights . . . . . . . . 18
Section 12. Certificate of Adjusted Purchase
Price or Number of Shares . . . . . . . . . . 28
Section 13. Combination, Consolidation, Merger
or Sale or Transfer of Assets or
Earning Power . . . . . . . . . . . . . . . . 28
Section 14. Fractional Rights and Fractional
Shares. . . . . . . . . . . . . . . . . . . . 31
Section 15. Rights of Action. . . . . . . . . . . . . . . 32
Section 16. Agreement of Right Holders. . . . . . . . . . 33
Section 17. Right Certificate Holder Not Deemed a
Shareholder . . . . . . . . . . . . . . . . . 34
Section 18. Concerning the Rights Agent . . . . . . . . . 34
Section 19. Merger or Consolidation or Change of
Name of Rights Agent. . . . . . . . . . . . . 35
Section 20. Duties of Rights Agent. . . . . . . . . . . . 36
Section 21. Change of Rights Agent. . . . . . . . . . . . 39
Section 22. Issuance of New Right Certificates. . . . . . 40
Section 23. Redemption and Termination. . . . . . . . . . 40
Section 24. Exchange. . . . . . . . . . . . . . . . . . . 42
Section 25. Notice of Certain Events. . . . . . . . . . . 43
Section 26. Notices . . . . . . . . . . . . . . . . . . . 44
Section 27. Supplements and Amendments. . . . . . . . . . 45
Section 28. Successors. . . . . . . . . . . . . . . . . . 46
Section 29. Determinations and Actions by the
Board of Directors, etc.. . . . . . . . . . . 46
Section 30. Benefits of This Agreement. . . . . . . . . . 46
Section 31. Severability. . . . . . . . . . . . . . . . . 46
Section 32. Governing Law . . . . . . . . . . . . . . . . 47
Section 33. Counterparts. . . . . . . . . . . . . . . . . 47
Section 34. Descriptive Headings. . . . . . . . . . . . . 47
Exhibit A - Form of Right Certificate . . . . . . . . . . A-1
- Form of Assignment. . . . . . . . . . . . . . A-5
- Certificate . . . . . . . . . . . . . . . . . A-6
- Notice. . . . . . . . . . . . . . . . . . . . A-7
- Form of Election to Purchase. . . . . . . . . A-8
- Certificate . . . . . . . . . . . . . . . . . A-9
- Notice. . . . . . . . . . . . . . . . . . . . A-9
Exhibit B - Summary of Rights to Purchase
Common Stock. . . . . . . . . . . . . . . . . B-1
RIGHTS AGREEMENT
Rights Agreement, dated as of February 1, 1996 (the
"Agreement"), between GENERAL SIGNAL CORPORATION, a New York
corporation (the "Company"), and FIRST CHICAGO TRUST COMPANY OF NEW
YORK, a New York corporation (the "Rights Agent").
W I T N E S S E T H :
WHEREAS, the Board of Directors of the Company on
February 1, 1996 (the "Rights Dividend Declaration Date")
authorized and declared a dividend distribution (the
"Distribution") of one Right for each outstanding share of the
Common Stock, $1.00 par value, of the Company (the "Common Stock")
outstanding at the close of business on March 21, 1996 (the "Record
Date") and has authorized the issuance of one Right (as such number
may hereinafter be adjusted pursuant to the provisions of Section
11(i) hereof) in respect of each share of Common Stock issued
(whether originally issued or delivered from the Company's treasury
shares) between the Record Date and the earlier of the Distribution
Date or the Expiration Date (as such terms are hereinafter
defined), each Right initially representing the right to purchase,
under certain circumstances, one share of the Common Stock, upon
the terms and subject to the conditions hereinafter set forth (the
"Rights");
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 (as such
term is hereinafter defined) who or which, together with all
Affiliates (as such term is hereinafter defined) and
Associates (as such term is hereinafter defined) of such
Person, shall be the Beneficial Owner (as such term is
hereinafter defined) of securities of the Company constituting
a Substantial Block (as such term is hereinafter defined), but
shall not include (i) the Company, any Subsidiary (as such
term is hereinafter defined) of the Company, any employee
benefit plan of the Company or of any Subsidiary of the
Company or any Person organized, appointed or established by
the Company or any Subsidiary of the Company for or pursuant
to the terms of any such plan, (ii) any Person who or which,
together with all Affiliates and Associates of such Person,
becomes the Beneficial Owner of a Substantial Block solely as
a result of a change in the aggregate number of shares of the
Common Stock or other voting securities of the Company
outstanding since the last date on which such Person acquired
Beneficial Ownership of any securities of the Company
constituting such Substantial Block, or (iii) any Person who
or which, together with all Affiliates and Associates of such
Person, becomes the Beneficial Owner of a Substantial Block in
the good faith belief that such acquisition would not (x)
cause such Person and its Affiliates and Associates to become
the Beneficial Owner of a Substantial Block and such Person
relied in good faith in computing the percentage of its voting
power on publicly filed reports or documents of the Company
which are inaccurate or out-of-date or (y) otherwise cause a
Distribution Date or the adjustment provided for in Section
11(a) to occur. Notwithstanding clause (iii) of the prior
sentence, if any Person that is not an Acquiring Person due to
such clause (iii) does not cease to be the Beneficial Owner of
a Substantial Block by the close of business on the last
Business Day of a period to be determined by the Board of
Directors of the Company and specified in a notice from the
Company that such Person is the Beneficial Owner of a
Substantial Block, such Person shall, at the end of such
specified period, become an Acquiring Person (and such clause
(iii) shall no longer apply to such Person). No failure by
the Board of Directors of the Company to give such notice for
a period of time, and no notice specifying a particular time
period by which such Person must cease to be the Beneficial
Owner of a Substantial Block, shall be deemed a waiver of the
right of the Board of Directors to subsequently give or modify
such notice. For purposes of this definition, the
determination whether any Person acted in "good faith" shall
be conclusively determined by the Board of Directors of the
Company, acting by a vote of those directors of the Company
whose approval would be required to redeem the Rights under
Section 23 hereof.
(b) "Act" shall have the meaning set forth in
Section 9(c) hereof.
(c) "Adjustment Shares" shall have the meaning set forth
in Section 11(a)(ii) hereof.
(d) "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of
the General Rules and Regulations under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), as in
effect on the date hereof.
(e) "Agreement" shall have the meaning set forth in the
introduction hereto.
(f) A Person shall be deemed the "Beneficial Owner" of
and shall be deemed to "beneficially own" any securities:
(i) which such Person or any of such Person's
Affiliates or Associates has, directly or indirectly, the
right to acquire (whether such right is exercisable
immediately or only after the passage of time or upon the
occurrence of an event) pursuant to any agreement,
arrangement or understanding (whether or not in writing),
or upon the exercise of conversion rights, exchange
rights, rights, warrants or options, or otherwise,
provided, however, that a Person shall not be deemed the
"Beneficial Owner" of, or to "beneficially own,"
(1) securities tendered pursuant to a tender or exchange
offer made by such Person or any of such Person's
Affiliates or Associates until such tendered securities
are accepted for purchase or exchange, (2) securities
issuable upon exercise of Rights at any time prior to the
occurrence of a Triggering Event or (3) securities
issuable upon exercise of Rights from and after the
occurrence of a Triggering Event (as such term is
hereinafter defined), 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(a) hereof ("Original Rights") or pursuant to Section
11(i) or Section 22 hereof in connection with an
adjustment made with respect to Original Rights; or
(ii) which such Person or any of such Person's
Affiliates or Associates has, directly or indirectly, the
right to vote or dispose of or has "beneficial ownership"
of (as determined pursuant to Rule 13d-3 of the General
Rules and Regulations under the Exchange Act), including
pursuant to any agreement, arrangement or understanding
(whether or not in writing), provided, however, that a
Person shall not be deemed the Beneficial Owner of, or to
"beneficially own," any security under this subparagraph
(ii) if the agreement, arrangement or understanding to
vote such security (1) arises solely from a revocable
proxy given in response to a public proxy or consent
solicitation made pursuant to, and in accordance with,
the applicable rules and regulations of the Exchange Act
and (2) is not then reportable on Schedule 13D under the
Exchange Act (or any comparable or successor report);
(iii) which are beneficially owned, directly or
indirectly, by any other Person with which such Person or
any of such Person's Affiliates or Associates has any
agreement, arrangement or understanding (whether or not
in writing) for the purpose of acquiring, holding, voting
(except pursuant to a revocable proxy as described in the
proviso to subparagraph (ii) of this paragraph (f)) or
disposing of any securities of the Company; or
(iv) which are directly, indirectly or
constructively owned by such Person or any of such
Person's Affiliates or Associates, within the meaning of
Section 958 of the Internal Revenue Code of 1986, as
amended.
Notwithstanding the foregoing, nothing contained in this
definition shall cause a Person ordinarily engaged in business
as an underwriter of securities to be the "Beneficial Owner"
of, or to "beneficially own," any securities acquired in a
bona fide firm commitment underwriting pursuant to an
underwriting agreement with the Company.
(g) "Business Day" shall mean any day other than a
Saturday, Sunday, or a day on which banking institutions in
the State of New York are authorized or obligated by law or
executive order to close.
(h) "Certification" shall have the meaning set forth in
Section 18 hereof.
(i) "close of business" on any given date shall mean
5:00 P.M., New York City time, on such date, provided,
however, if such date is not a Business Day it shall mean 5:00
P.M. on the next succeeding Business Day.
(j) "Company" shall have the meaning set forth in the
introduction hereto.
(k) "Current Value" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(l) "Distribution" shall have the meaning set forth in
the recitals hereto.
(m) "Distribution Date" shall have the meaning set forth
in Section 3(a) hereof.
(n) "equivalent shares of common stock" shall have the
meaning set forth in Section 11(b) hereof.
(o) "Exchange Act" shall have the meaning set forth in
the definitions of "Affiliate" and "Associate" above.
(p) "Exchange Ratio" shall have the meaning set forth in
Section 24(a) hereof.
(q) "Expiration Date" shall have the meaning set forth
in Section 7(a) hereof.
(r) "Final Expiration Date" shall have the meaning set
forth in Section 7(a) hereof.
(s) "Independent Director" shall mean any member of the
Board of Directors of the Company, while such person is a
member of the Board, who is not an Acquiring Person, or an
Affiliate or Associate of an Acquiring Person, or a
representative or nominee of an Acquiring Person or of any
such Affiliate or Associate, and was a member of the Board
prior to the time that any Person becomes an Acquiring Person,
and any successor of an Independent Director while such
successor is a member of the Board, who is not an Acquiring
Person or an Affiliate or Associate of an Acquiring Person, or
a representative or nominee of an Acquiring Person or of any
such Affiliate or Associate, and is recommended or elected to
succeed the Independent Director by a majority of the
Independent Directors.
(t) "common stock equivalent" shall have the meaning set
forth in Section 11(a)(iii).
(u) "Common Stock" when used with reference to the
Company shall mean the Common Stock, $1.00 par value, of the
Company. "Common Stock" when used with reference to any
Person other than the Company shall mean the capital stock
with the greatest voting power of such Person or the equity
securities or other equity interest having power to control or
direct the management of such Person.
(v) "Original Rights" shall have the meaning set forth
in the definition of "Beneficial Owner" above.
(w) "Person" shall mean any individual, firm,
corporation, partnership or other entity, including any
"group" within the meaning of Section 13(d)(3) of the Exchange
Act and the General Rules and Regulations thereunder.
(x) "Principal Party" shall have the meaning set forth
in Section 13(b) hereof.
(y) "Purchase Price" shall have the meaning set forth in
Section 4(a) hereof.
(z) "Record Date" shall have the meaning set forth in
the recitals hereto.
(aa) "Redemption Price" shall have the meaning set forth
in Section 23(a) hereof.
(bb) "Right Certificate" shall have the meaning set forth
in Section 3(a) hereof.
(cc) "Rights" shall have the meaning set forth in the
recitals hereto.
(dd) "Rights Agent" shall have the meaning set forth in
the introduction hereto.
(ee) "Rights Dividend Declaration Date" shall have the
meaning set forth in the recitals hereto.
(ff) "Section 11(a)(ii) Event" shall mean any event
described in Section 11(a)(ii).
(gg) "Section 11(a)(ii) Trigger Date" shall have the
meaning set forth in Section 11(a)(iii).
(hh) "Section 13 Event" shall mean any event described in
Section 13(a).
(ii) "Shares Acquisition Date" shall mean the first date
of public announcement (which, for purposes of this
definition, includes a report filed pursuant to Section 13(d)
of the Exchange Act) by the Company or an Acquiring Person
that an Acquiring Person has become such.
(jj) "Spread" shall have the meaning set forth in Section
11(a)(iii) hereof.
(kk) "Subsidiary" shall mean, with reference to any
Person, any company (or other entity) of which an amount of
voting securities (or comparable ownership interests)
sufficient to elect at least a majority of the directors (or
comparable persons) of such company (or other entity) is
beneficially owned or otherwise controlled, directly or
indirectly, by such Person.
(ll) "Substantial Block" shall mean a number of shares of
the Common Stock equal to or in excess of 20% of the number of
shares of the Common Stock then outstanding.
(mm) "Substitution Period" shall have the meaning set
forth in Section 11(a)(iii) hereof.
(nn) "Summary of Rights" shall have the meaning set forth
in Section 3(b) hereof.
(oo) "Trading Day" shall have the meaning set forth in
Section 11(d) hereof.
(pp) "Triggering Event" shall mean any Section 11(a)(ii)
Event or Section 13 Event.
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. The Company shall act as
Co-Rights Agent and may from time to time appoint such other Co-
Rights Agents as it may deem necessary or desirable upon ten
calendar days' written notice to the Rights Agent. In no event
shall the Rights Agent have any duty to supervise or in any way be
liable for such Co-Rights Agents.
Section 3. Issue of Right Certificates. (a) Until the
earlier of (i) the close of business on the tenth calendar day
after the Shares Acquisition Date (or, if the tenth day after the
Shares Acquisition Date occurs before the Record Date, the close of
business on the Record Date) or (ii) the close of business on the
tenth calendar day after the date of the commencement of, or first
public announcement of the intent of any Person to commence, a
tender or exchange offer if, upon consummation thereof, such Person
would be an Acquiring Person (the earlier of the dates in
subsection (i) and (ii) hereof being herein referred to as the
"Distribution Date"), (x) the Rights will be evidenced (subject to
the provisions of paragraph (b) of this Section 3) by the
certificates for the Common Stock registered in the names of the
holders of the Common Stock (which certificates for the Common
Stock shall be deemed also to be Right Certificates) and not by
separate Right Certificates, and (y) the right to receive Right
Certificates will be transferable only in connection with the
transfer of the Common Stock. As soon as practicable after receipt
by the Rights Agent of written notice from the Company of the
Distribution Date, the Rights Agent, at the Company's expense, will
send by first-class, postage prepaid mail, to each record holder of
the Common Stock as of the close of business on the Distribution
Date, at the address of such holder shown on the records of the
Company, a Right Certificate, in substantially the form of
Exhibit A hereto, evidencing one Right for each share of the Common
Stock so held, subject to adjustment as provided herein. As of the
Distribution Date, the Rights will be evidenced solely by such
Right Certificates.
(b) As soon as practicable following the Record Date,
the Company will send a copy of a Summary of Rights to Purchase
Common 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 the Common Stock as of the close of
business on the Record Date, at the address of such holder shown on
the records of the Company. With respect to certificates for the
Common Stock outstanding as of the Record Date, until the
Distribution Date, the Rights will be evidenced by such
certificates for the Common Stock, and the registered holders of
the Common Stock shall also be the registered holders of the
associated Rights. Until the Distribution Date (or earlier
redemption or expiration of the Rights), the surrender for transfer
of any of the certificates for the Common Stock outstanding on the
Record Date shall also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate.
(c) Rights shall be issued in respect of all shares of
Common Stock issued after the Record Date but prior to the earlier
of the Distribution Date or the Expiration Date (as such term is
defined in Section 7), or, in certain circumstances provided in
Section 22 hereof, after the Distribution Date. Certificates
representing such shares of Common Stock shall have impressed on,
printed on, written on or otherwise affixed to them the following
legend:
This certificate also evidences and entitles the holder
hereof to certain Rights as set forth in a Rights
Agreement between GENERAL SIGNAL CORPORATION and FIRST
CHICAGO TRUST COMPANY OF NEW YORK dated as of February 1,
1996 (the "Rights Agreement"), the terms of which are
hereby incorporated herein by reference and a copy of
which is on file at the principal executive offices of
GENERAL SIGNAL CORPORATION. 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. GENERAL SIGNAL
CORPORATION 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,
Rights which are or were beneficially owned by Acquiring
Persons or their Affiliates or Associates (as such terms
are defined in the Rights Agreement) and any subsequent
holder of such Rights may become null and void.
After the due execution of any supplement or amendment to this
Agreement in accordance with the terms hereof, the reference to
this Agreement in the foregoing legend shall mean the Agreement as
so supplemented or amended. Until the Distribution Date, the
Rights associated with the Common Stock represented by certificates
containing the foregoing legend shall be evidenced by such
certificates alone, and the surrender for transfer of any of such
certificates shall also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate.
Section 4. Form of Right Certificates. (a) The Right
Certificates (and the forms of election to purchase shares and of
assignment to be printed on the reverse thereof) shall be
substantially the same as 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 with any
rule or regulation made pursuant thereto or with any rule or
regulation of any stock exchange on which the Rights may from time
to time be listed, or to conform to usage. The Right Certificates
shall be in machine-printable format and in a form reasonably
satisfactory to the Rights Agent. Subject to the provisions of
Section 11 and Section 22 hereof, the Right Certificates, whenever
distributed, shall be dated as of the Record Date, shall show the
date of countersignature, and on their face shall entitle the
holders thereof to purchase such number of shares of the Common
Stock (or following a Triggering Event, other securities, cash or
other assets, as the case may be) as shall be set forth therein at
the price per share set forth therein (the "Purchase Price"), but
the number of such shares and the Purchase Price shall be subject
to adjustment as provided herein.
(b) Any Right Certificate issued pursuant to Section
3(a) or 22 hereof that represents Rights beneficially owned by:
(i) an Acquiring Person or any Associate or Affiliate of an
Acquiring Person, (ii) a transferee of an Acquiring Person (or of
any such Associate or Affiliate) who becomes a transferee after the
Acquiring Person becomes such, or (iii) a transferee of an
Acquiring Person (or of any such Associate or Affiliate) who
becomes a transferee prior to or concurrently with the Acquiring
Person becoming such and receives such Rights pursuant to either
(A) a transfer (whether or not for consideration) from the
Acquiring Person to holders of equity interests in such Acquiring
Person or to any Person with whom such Acquiring Person has any
continuing agreement, arrangement or understanding (whether or not
in writing) regarding the transferred Rights or (B) a transfer
which the Board of Directors of the Company has determined is part
of a plan, arrangement or understanding (whether or not in writing)
which has as a primary purpose or effect avoidance of Section 7(e)
hereof, and any Right Certificate issued pursuant to Section 6 or
11 hereof upon transfer, exchange, replacement or adjustment of any
other Right Certificate referred to in this sentence, shall contain
(to the extent feasible) the following legend:
The Rights represented by this Right Certificate are or
were beneficially owned by a Person who was or became an
Acquiring Person or an Affiliate or Associate of an
Acquiring Person (as such terms are defined in the Rights
Agreement). Accordingly, this Right Certificate and the
Rights represented hereby may become null and void in the
circumstances specified in Section 7(e) of such
Agreement.
Section 5. Countersignature and Registration. The Right
Certificates shall be executed on behalf of the Company by one of
its authorized officers, either manually or by facsimile signature.
The Right Certificates shall be countersigned by an authorized
signatory of the Rights Agent either manually or by facsimile
signature and shall not be valid for any purpose unless so
countersigned. In case any officer of the Company who shall have
signed any of the Right Certificates shall cease to be such officer
of the Company before countersignature by the Rights Agent and
issuance and delivery by the Company, such Right Certificates,
nevertheless may be countersigned by the Rights Agent, issued and
delivered with the same force and effect as though the person who
signed such Right Certificates had not ceased to be such officer of
the Company; and any Right Certificate may be signed on behalf of
the Company by any person who, at the actual date of the execution
of such Right Certificate, shall be a proper officer of the Company
to sign such Right Certificate, although at the date of the
execution of this Rights Agreement any such person was not such an
officer.
In case any authorized signatory of the Rights Agent who
shall have countersigned any of the Right Certificates shall cease
to be such signatory before delivery by the Company, such Right
Certificates, nevertheless, may be issued and delivered by the
Company with the same force and effect as though the person who
countersigned such Right Certificates had not ceased to be such
signatory; and any Right Certificates may be countersigned on
behalf of the Rights Agent by any person who, at the actual date of
the countersignature of such Right Certificate, shall be a proper
signatory of the Rights Agent to countersign such Right
Certificate, although at the date of the execution of this Rights
Agreement any such person was not such a signatory.
Following the Distribution Date, the Rights Agent will
keep or cause to be kept, at its office designated for such
purpose, books for registration and transfer of the Right
Certificates issued hereunder. Such books shall show the names and
addresses of the respective holders of the Right Certificates
issued hereunder. Such books shall show the names and addresses of
the respective holders of the Right Certificates, the number of
Rights evidenced on its face by each of the Right Certificates, the
date of each of the Right Certificates and the date of
countersignature of each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange
of Right Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates. Subject to the provisions of Section 14 hereof, at
any time after the close of business on the Distribution Date, and
at or prior to the close of business on the Expiration Date, any
Right Certificate or Certificates may be transferred, split up,
combined or exchanged for another Right Certificate or Right
Certificates, entitling the registered holder to purchase a like
number of shares of the Common Stock (or following a Triggering
Event, other securities, cash or other assets, as the case may be)
as the Right Certificate or Right Certificates surrendered then
entitled such holder (or former holder in the case of a transfer)
to purchase. Any registered holder desiring to transfer, split up,
combine or exchange any Right Certificates shall make such request
in writing delivered to the Rights Agent, and shall surrender the
Right Certificate or Right Certificates to be transferred, split
up, combined or exchanged at the office of the Rights Agent
designated for such purpose, along with a signature guarantee and
such other and further documentation as the Rights Agent may
reasonably request. Neither the Rights Agent nor the Company shall
be obligated to take any action whatsoever with respect to the
transfer of any such surrendered Right Certificate until the
registered holder shall have completed and signed the certificate
contained in the form of assignment on the reverse side of such
Right Certificate and shall have provided such additional evidence,
as the Company shall reasonably request of the identity of the
Beneficial Owner, Affiliates or Associates of such Beneficial Owner
or holder, or of any other Person with which such holder or any of
such holder's Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing) for the
purpose of acquiring, holding, voting or disposing of securities of
the Company. Thereupon the Rights Agent shall, subject to
Section 14 and Section 20(k) hereof, countersign and deliver to the
Person entitled thereto a Right Certificate or Right Certificates,
as the case may be, as so requested. The Company may require
payment from a Right Certificates holder 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
Right Certificates.
Upon receipt by the Company and the Rights Agent of
evidence reasonably satisfactory to them of the loss, theft,
destruction or mutilation of a Right Certificate, and, in case of
loss, theft or destruction, of indemnity or security reasonably
satisfactory to them, along with a signature guarantee and such
other and further documentation as the Rights Agent may reasonably
request, and if requested by the Company, reimbursement to the
Company and the Rights Agent of all reasonable expenses incidental
thereto, and upon surrender to the Rights Agent and cancellation of
the Right Certificate if mutilated, the Company will make and
deliver a new Right Certificate of like tenor to the Rights Agent
for delivery to the registered owner in lieu of the Right
Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights. (a) Subject to Section 7(e) hereof,
the registered holder of any Right Certificate may exercise the
Rights evidenced thereby (except as otherwise provided herein
including, without limitation, the restrictions on exercisability
set forth in Sections 9(c), 11(a)(iii), 23(a) and 24(b) hereof) in
whole or in part at any time after the Distribution Date upon
surrender of the Right Certificate, with the form of election to
purchase on the reverse side thereof duly executed, to the Rights
Agent at the designated office of the Rights Agent, together with
payment of the aggregate Purchase Price for the total number of
shares of the Common Stock (or other securities, cash or other
assets, as the case may be) as to which the Rights are then
exercisable, at or prior to the earliest of (i) the close of
business on March 21, 2006 (the "Final Expiration Date"), or
(ii) the time at which the Rights are redeemed as provided in
Section 23 hereof or (iii) the time at which all exercisable Rights
are exchanged as provided in Section 24 hereof (such earliest date
being herein referred to as the "Expiration Date").
(b) The Purchase Price for each share of the Common
Stock pursuant to the exercise of a Right shall initially be
$150.00, shall be subject to adjustment from time to time as
provided in Sections 11 and 13 hereof and shall be payable in
lawful money of the United States of America in accordance with
paragraph (c) below.
(c) Upon receipt of a Right Certificate representing
exercisable Rights, with the form of election to purchase and the
certificate duly executed and completed accompanied by payment of
the Purchase Price for the number of shares of the Common Stock (or
other securities, cash or other assets, as the case may be) to be
purchased and an amount equal to any applicable transfer tax, the
Rights Agent shall thereupon, subject to Section 20(k), promptly
(i) requisition from the Company certificates for the number of
shares of the Common Stock to be purchased, (ii) if the Company
shall have elected to deposit the total number of shares of the
Common Stock issuable upon exercise of the Rights hereunder with a
depositary agent, requisition from the depositary agent depositary
receipts representing such number of shares of the Common Stock as
are to be purchased (in which case certificates for the shares of
the Common Stock represented by such receipts shall be deposited by
the transfer agent with the depositary agent) and the Company
hereby directs the depositary agent to comply with such request,
(iii) when appropriate, requisition from the Company the amount of
cash to be paid in lieu of issuance of fractional shares in
accordance with Section 14, (iv) promptly after receipt of such
certificates or depositary receipts, cause the same to be delivered
to or upon the order of the registered holder of such Right
Certificate, registered in such name or names as may be designated
by such holder and (v) when appropriate, after receipt promptly
deliver such cash to or upon the order of the registered holder of
such Right Certificate. The payment of the then Purchase Price
must be made in cash or by certified bank check or bank draft or
money order payable to the order of the Company or the Rights
Agent. In the event that the Company is obligated to issue
securities, distribute property or pay cash pursuant to Section
11(a)(iii) hereof, the Company will make all arrangements necessary
so that cash, property or securities are available for issuance,
distribution or payment by the Rights Agent, if and when
appropriate.
(d) In case the registered holder of any Right
Certificate shall exercise less than all the Rights evidenced
thereby, a new Right Certificate evidencing Rights equivalent to
the Rights remaining unexercised shall be issued by the Rights
Agent to the registered holder of such Right Certificate or to his
duly authorized assigns, 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) who becomes a transferee after the Acquiring Person
becomes such, or (iii) a transferee of an Acquiring Person (or of
any such Associate or Affiliate) who becomes a transferee prior to
or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer (whether or
not for consideration) from the Acquiring Person to holders of
equity interests in such Acquiring Person or to any Person which
whom the Acquiring Person has any continuing agreement, arrangement
or understanding (whether or not in writing) regarding the
transferred Rights or (B) a transfer which the Board of Directors
of the Company has determined is part of a plan, arrangement or
understanding (whether or not in writing) which has as a primary
purpose or effect the avoidance of this Section 7(e), shall become
null and void without any further action and no holder of such
Rights shall have any rights whatsoever with respect to such
Rights, whether under any provision of this Agreement or otherwise.
The Company shall use all reasonable efforts to insure that the
provisions of this Section 7(e) and Section 4(b) hereof are
complied with, but shall have no liability to any holder of Right
Certificates or other Person as a result of its failure to make any
determinations with respect to an Acquiring Person, or any of its
Affiliates, Associates or transferees hereunder.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be
obligated to undertake any action with respect to a registered
holder upon the occurrence of any purported exercise as set forth
in this Section 7 unless such registered holder shall have (i)
completed and signed the certificate contained in the form of
election to purchase set forth on the reverse side of the Right
Certificate surrendered for such exercise, and (ii) provided such
additional evidence of the identity of the Beneficial Owner,
Affiliates or Associates of such Beneficial Owner or holder, or of
any other Person with which such holder or any of such holder's
Affiliates or Associates has any agreement, arrangement or
understanding (whether or not in writing) for the purpose of
acquiring, holding, voting or disposing of any securities of the
Company as the Company shall reasonably request.
Section 8. Cancellation and Destruction of Right
Certificates. All Right Certificates surrendered for the purpose
of exercise, transfer, split up, combination or exchange shall, if
surrendered to the Company or to any of its agents, be delivered to
the Rights Agent for cancellation or in cancelled form, or, if
surrendered to the Rights Agent, shall be cancelled by it, and no
Right Certificates shall be issued in lieu thereof except as
expressly permitted by any of the provisions of this Rights
Agreement. The Company shall deliver to the Rights Agent for
cancellation and retirement, and the Rights Agent shall so cancel
and retire, any other Right Certificate purchased or acquired by
the Company otherwise than upon the exercise thereof. The Rights
Agent shall deliver all cancelled Right Certificates to the
Company, or shall, at the written request of the Company, destroy
such cancelled Right Certificates, and in such case shall deliver
a certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Shares of
Common Stock. (a) The Company covenants and agrees that it will,
subject to Section 11(a)(iii), prior to the Distribution Date, seek
to cause to be reserved and kept available out of its authorized
and unissued Common Stock (and following the occurrence of a
Triggering Event, out of its authorized and unissued other
securities) or out of its authorized and issued Common Stock (and,
following the occurrence of a Triggering Event, out of its
authorized and issued other securities) held in its treasury, the
number of shares of the Common Stock (and, following the occurrence
of a Triggering Event, Common Stock and other securities) that will
be sufficient to permit the exercise in full of all outstanding
Rights (it being understood that any of the foregoing shares or
securities may also be reserved for other purposes) or will take
such other steps as are appropriate to assure that the number of
such shares or securities (or their equivalents) sufficient to
permit the exercise in full of all outstanding Rights will be
available upon such exercise.
(b) So long as the Common Stock (and, following the
occurrence of a Triggering Event, other securities) issuable upon
the exercise of Rights may be listed on any national securities
exchange, the Company shall use its best efforts to cause, from and
after such time as the Rights become exercisable (but only to the
extent that it is reasonably likely that the Rights will be
exercised), all shares reserved for such issuance to be listed on
such exchange upon official notice of issuance upon such exercise.
(c) The Company shall use its best efforts to (i) file,
as soon as practicable following the first occurrence of a Section
11(a)(ii) Event, or as soon as required by law, as the case may be,
a registration statement under the Securities Act of 1933, as
amended (the "Act"), with respect to the securities purchasable
upon exercise of the Rights on an appropriate form, (ii) cause such
registration statement to become effective as soon as practicable
after such filing, and (iii) cause such registration statement to
remain effective (with a prospectus at all times meeting the
requirements of the Act) until the earlier of (A) the date as of
which the Rights are no longer exercisable for such securities, and
(B) the Expiration Date. The Company will also take such action as
may be appropriate under the blue sky laws of the various states.
The Company may temporarily suspend, for a period of time not to
exceed ninety (90) days after the date set forth in clause (i) of
the first sentence of this Section 9(c), the exercisability of the
Rights in order to prepare and file such registration statement and
permit it to become effective. Upon any such suspension, the
Company shall issue a public announcement and shall give
simultaneous written notice to the Rights Agent stating that the
exercisability of the Rights has been temporarily suspended, as
well as a public announcement and notice to the Rights Agent at
such time as the suspension is no longer in effect.
Notwithstanding any provision of this Agreement to the contrary,
the Rights shall not be exercisable in any jurisdiction unless the
requisite qualifications in such jurisdiction shall have been
obtained.
(d) The Company covenants and agrees that it will take
all such action as may be necessary to ensure that all shares of
the Common Stock (and following the occurrence of a Triggering
Event, other securities) delivered upon exercise of Rights shall,
at the time of delivery of the certificates for such shares
(subject to payment of the Purchase Price), be duly and validly
authorized and issued and fully paid and nonassessable.
(e) The Company further covenants and agrees that it
will pay when due and payable any and all federal and state
transfer taxes and charges which may be payable in respect of the
issuance or delivery of the Right Certificates or of any shares of
the Common Stock (or other securities, as the case may be) upon the
exercise of Rights. The Company shall not, however, be required
(a) to pay any transfer tax which may be payable in respect of any
transfer involved in the transfer or delivery of Right Certificates
or the issuance or delivery of certificates for the shares of the
Common Stock (or other securities, as the case may be) in a name
other than that of the registered holder of the Right Certificate
evidencing Rights surrendered for exercise or (b) to issue or
deliver any certificates for shares of the Common Stock (or other
securities, as the case may be) upon the exercise of any Rights
until any such tax shall have been paid (any such tax being payable
by the holder of such Right Certificate at the time of surrender)
or until it has been established to the Company's satisfaction that
no such tax is due.
Section 10. Common Stock Record Date. Each person in
whose name any certificate for shares of the Common Stock (or other
securities, as the case may be) is issued upon the exercise of
Rights shall for all purposes be deemed to have become the holder
of record of such whole and/or fractional shares of the Common
Stock (or other securities, as the case may be) represented thereby
on, and such certificate shall be dated the date upon which the
Right Certificate evidencing such Rights was duly surrendered and
payment of the Purchase Price (and any applicable transfer taxes)
was made and shall show the date of countersignature; provided,
however, that if the date of such surrender and payment is a date
upon which the Common Stock (or other securities, as the case may
be) transfer books of the Company are closed, such person shall be
deemed to have become the record holder of such shares on, and such
certificate shall be dated, the next succeeding Business Day on
which the Common Stock (or other securities, as the case may be)
transfer books of the Company are open. Prior to the exercise of
the Rights evidenced thereby, the holder of a Right Certificate
shall not be entitled to any rights of a stockholder of the Company
with respect to shares for which the Rights shall be exercisable,
including, without limitation, the right to vote, to receive
dividends or other distributions or to exercise any preemptive
rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price, Number of
Shares or Number of Rights. The Purchase Price, the number of
shares covered by each Right and the number of Rights outstanding
are subject to adjustment from time to time as provided in this
Section 11.
(a) (i) In the event the Company shall at any time
after the date of this Agreement (A) declare a dividend on the
Common Stock payable in shares of the Common Stock, (B) subdivide
the outstanding Common Stock, (C) combine the outstanding Common
Stock into a smaller number of shares or (D) issue any share
capital in a reclassification of the Common Stock (including any
such reclassification in connection with a combination,
consolidation or merger in which the Company is the continuing or
surviving corporation), except as otherwise provided in this
Section 11(a) and Section 7(e) hereof, the Purchase Price in effect
at the time of the record date for such dividend or of the
effective date of such subdivision, combination or
reclassification, and the number and kind of shares of the Common
Stock or share capital, as the case may be, issuable on such date,
shall be proportionately adjusted so that the holder of any Right
exercised after such time shall be entitled to receive upon payment
of the Purchase Price then in effect the aggregate number and kind
of share capital which, if such Right had been exercised
immediately prior to such date and at a time when the Common Stock
(or other securities) transfer books of the Company were open, he
would have owned upon such exercise and been entitled to receive by
virtue of such dividend, subdivision, combination or
reclassification. If an event occurs which would require an
adjustment under both this Section 11(a)(i) and Section 11(a)(ii),
the adjustment provided for in this Section 11(a)(i) shall be in
addition to, and shall be made prior, to any adjustment required
pursuant to Section 11(a)(ii).
(ii) Subject to Section 24 of this Agreement, in the
event any Person, alone or together with its Affiliates and
Associates, becomes at any time after the Rights Dividend
Declaration Date, an Acquiring Person except as the result of a
transaction set forth in Section 13(a) hereof, then, (x) prior to
the date on which the Company's right of redemption pursuant to
Section 23(a) expires (as the same may be extended pursuant to
Section 27) with respect to an event described in this Section
11(a)(ii), proper provision shall be made so that each holder of a
Right, except as provided in Section 7(e) hereof, shall thereafter
have a right to receive, upon exercise thereof at the then current
Purchase Price in accordance with the terms of this Agreement, such
number of shares of the Common Stock of the Company as shall equal
the result obtained by (x) multiplying the then current Purchase
Price by the number of shares of the Common Stock for which a Right
is then exercisable and dividing that product by (y) 50% of the
current market price per share of the Common Stock of the Company
(determined pursuant to Section 11(d)) on the date of the
occurrence of any one of the events listed above in this
subparagraph (ii) (such number of shares is hereinafter referred to
as the "Adjustment Shares"), provided that the Purchase Price and
the number of Adjustment Shares shall be further adjusted as
provided in this Agreement to reflect any events occurring after
the date of such first occurrence.
(iii) In the event that the number of shares of the Common
Stock which are authorized by the Company's 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 subparagraphs (i) and (ii), the Company shall
(A) determine the excess of (1) the value of the Adjustment Shares
issuable upon the exercise of a Right (the "Current Value") over
(2) the Purchase Price (such excess, the "Spread"), and (B) with
respect to each Right, make adequate provision to substitute for
the Adjustment Shares, upon exercise of the Rights and payment of
the applicable Purchase Price, (1) cash, (2) a reduction in the
Purchase Price, (3) other equity securities of the Company
(including, without limitation, preference shares, or units of
preference shares, which a majority of the Independent Directors
and the Board of Directors of the Company have deemed to have the
same value as the Common Stock (such preference shares, "common
stock equivalents")), (4) debt securities of the Company, (5) other
assets, or (6) any combination of the foregoing, having an
aggregate value equal to the Current Value, where such aggregate
value has been determined by a majority of the Independent
Directors and the Board of Directors of the Company based upon the
advice of a nationally recognized investment banking firm selected
by the Board of Directors of the Company; provided, however, 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, as the same may be extended pursuant to
Section 27 (the later of (x) and (y) being referred to herein as
the "Section 11(a)(ii) Trigger Date"), then the Company shall be
obligated to deliver, upon the surrender for exercise of a Right
and without requiring payment of the Purchase Price, shares of the
Common Stock (to the extent available) and then, if necessary,
cash, which shares and/or cash have an aggregate value equal to the
Spread. If the Board of Directors of the Company shall determine
in good faith that it is likely that sufficient additional shares
of the Common Stock could be authorized for issuance upon exercise
in full of the Rights, the thirty (30) day period set forth above
may be extended to the extent necessary, but not more than ninety
(90) days after the Section 11(a)(ii) Trigger Date, in order that
the Company may seek shareholder approval for the authorization of
such additional shares (such period, as it may be extended, the
"Substitution Period"). To the extent that the Company determines
that some action need be taken pursuant to the first and/or second
sentences of this Section 11(a)(iii), the Company (x) shall
provide, subject to Section 7(e) hereof, that such action shall
apply uniformly to all outstanding Rights, and (y) may suspend the
exercisability of the Rights until the expiration of the
Substitution Period in order to seek any authorization of
additional shares and/or to decide the appropriate form of
distribution to be made pursuant to such first sentence and to
determine the value thereof. In the event of any such suspension,
the Company shall issue a public announcement and shall give
concurrent written notice to the Rights Agent stating that the
exercisability of the Rights has been temporarily suspended, as
well as a public announcement and notice to the Rights Agent at
such time as the suspension is no longer in effect. For purposes
of this Section 11(a)(iii), the value of the shares of the Common
Stock shall be the current market price (as determined pursuant to
Section 11(d) hereof) per share on the Section 11(a)(ii) Trigger
Date and the value of any "common stock equivalent" shall be deemed
to be the same as the value of the Common Stock on such date. The
Company shall give the Rights Agent notice of the selection of any
"common stock equivalent" under 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 the
Common Stock entitling them (for a period expiring within 45
calendar days after such record date) to subscribe for or purchase
the Common Stock (or securities having substantially the same
rights, privileges and preferences as the Common Stock ("equivalent
common stock") or convertible into the Common Stock or equivalent
common stock) at a price per share or equivalent common stock (or
having a conversion price per share, if a security convertible into
the Common Stock or equivalent common stock) less than the current
market price (as defined in Section 11(d) per share or equivalent
common stock, as the case may be) 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, of which the numerator shall be the
number of shares of the Common Stock outstanding on such record
date plus the number of shares of the Common Stock or equivalent
common stock which the aggregate offering price of the total number
of shares of the Common Stock or equivalent common 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 of which the denominator shall be the
number of shares of the Common Stock outstanding on such record
date plus the number of additional shares of the Common Stock
and/or equivalent common stock to be offered for subscription or
purchase (or into which the convertible securities so to be offered
are initially convertible). In case such subscription price may be
paid by delivery of consideration part or all of which shall be in
a form other than cash, the value of such consideration shall be as
determined in good faith by the Board of Directors of the Company,
whose determination shall be described in a statement filed with
the Rights Agent. Shares of the Common Stock owned by or held for
the account of the Company shall not be deemed outstanding for the
purpose of any such computation. Such adjustment shall be made
successively whenever such a record date is fixed; and in the event
that such rights, options or warrants are not so issued, the
Purchase Price shall be adjusted to be the Purchase Price which
would then be in effect if such record date had not been fixed.
(c) In case the Company shall fix a record date for the
making of a distribution to all holders of the Common Stock
(including any such distribution made in connection with a
combination, consolidation or merger in which the Company is the
continuing or surviving corporation) of evidences of indebtedness
or assets (other than a regular periodic cash dividend or a
dividend payable in the Common Stock) or subscription rights or
warrants (excluding those referred to in Section 11(b)), 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, of which the numerator
shall be the current market price per share of the Common Stock (as
defined in Section 11(d)) on such record date, less the fair market
value (as determined in good faith by the Board of Directors of the
Company, whose determination shall be described in a statement
filed with the Rights Agent) of the portion of the assets or
evidences of indebtedness so to be distributed or of such
subscription rights or warrants applicable to one share of the
Common Stock and of which the denominator shall be such current
market price per share of the Common Stock. Such adjustments shall
be made successively whenever such a record date is fixed; and in
the event that such distribution is not so made, the Purchase
Price shall again be adjusted to be the Purchase Price which would
then be in effect if such record date had not been fixed.
(d) For the purpose of any computation hereunder, other
than computations made pursuant to Section 11(a)(iii), the "current
market price" per share of the Common Stock on any date shall be
deemed to be the average of the daily closing prices per share of
such Common Stock for the thirty (30) consecutive Trading Days (as
such term is hereinafter defined in this paragraph (d)) immediately
prior to such date and, for purposes of computations made pursuant
to Section 11(a)(iii) hereof, the "current market price" per share
of the Common Stock on any date shall be deemed to be the average
of the daily closing prices per share of such Common Stock for the
ten (10) consecutive Trading Days immediately following such date;
provided, however, that in the event that the current market price
per share of the Common Stock is determined during the period
following the announcement by the issuer of such Common Stock of
(A) a dividend or distribution on such Common Stock payable in
shares of such Common Stock or securities convertible into such
Common Stock (other than the Rights) or (B) any subdivision,
combination or reclassification of such Common Stock, and prior to
the expiration of the requisite 30 Trading Day or 10 Trading Day
period, as set forth above, after the ex-dividend date for such
dividend or distribution or the record date for such subdivision,
combination or reclassification, then, and in each such case, the
current market price shall be appropriately adjusted to take into
account ex-dividend trading. The closing price for each day shall
be the last sale price, regular way, or, in case no such sale takes
place on such day, the average of the closing bid and asked prices,
regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to
securities listed or admitted to trading on the New York Stock
Exchange or, if the shares of the Common Stock are not listed or
admitted to trading on the New York Stock Exchange, as reported in
the principal consolidated transaction reporting system with
respect to securities listed on the principal national securities
exchange on which the shares of the Common Stock are listed or
admitted to trading or, if the shares of the Common Stock are not
listed or admitted to trading on any national securities exchange,
the last quoted price, or, if not so quoted, the average of the
high bid and low asked prices in the over-the-counter market, as
reported by the National Association of Securities Dealers, Inc.
Automated Quotation System ("NASDAQ") or such other system then in
use, or, if on any such date the shares of the Common Stock are
not quoted by such organization, the average of the closing bid and
asked prices as furnished by a professional market maker making a
market in the shares of the Common Stock selected by the Board of
Directors of the Company. If on any such date no market maker is
making a market in the shares of the Common Stock, the fair value
of such shares on such date shall be as determined in good faith by
the Independent Directors if the Independent Directors constitute
a majority of the Board of Directors or, in the event the
Independent Directors do not constitute a majority of the Board of
Directors, by an independent investment banking firm selected by
the Board of Directors, whose determination shall be described in
a statement filed with the Rights Agent and shall be conclusive for
all purposes. The term "Trading Day" shall mean a day on which the
principal national securities exchange on which the shares of the
Common Stock are listed or admitted to trading is open for the
transaction of business or, if the shares of the Common Stock are
not listed or admitted to trading on any national securities
exchange, a Monday, Tuesday, Wednesday, Thursday or Friday on which
banking institutions in the State of New York, are not authorized
or obligated by law or executive order to close. If the Common
Stock is 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 the Independent Directors if the
Independent Directors constitute a majority of the Board of
Directors or, in the event the Independent Directors do not
constitute a majority of the Board of Directors, by an independent
investment banking firm selected by the Board of Directors, whose
determination shall be described in a statement filed with the
Rights Agent and shall be conclusive for all purposes.
(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
such price; provided, however, that any adjustments which by reason
of this Section 11(e) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All
calculations under this Section 11 shall be made to the nearest
cent or to the nearest ten-thousandth of a share. Notwithstanding
the first sentence of this Section 11(e), any adjustment required
by this Section 11 shall be made no later than the earlier of
(i) three years from the date of the transaction which mandates
such adjustment or (ii) the Expiration Date.
(f) If as a result of an adjustment made pursuant to
Section 11(a) or Section 13(a), the holder of any Right thereafter
exercised shall become entitled to receive any share capital other
than shares of the Common 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 shares contained in
Section 11(a) through (p), inclusive, and the provisions of
Sections 7, 9, 10, 13 and 14 with respect to the shares of the
Common Stock shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder
shall evidence the right to purchase, at the adjusted Purchase
Price, the number of shares of the Common Stock purchasable from
time to time hereunder upon exercise of the Rights, all subject to
further adjustment as provided herein.
(h) Unless the Company shall have exercised its election
as provided in Section 11(i), upon each adjustment of the Purchase
Price as a result of the calculations made in Section 11(b) and
(c), each Right outstanding immediately prior to the making of such
adjustment shall thereafter evidence the right to purchase, at the
adjusted Purchase Price, that number of shares (calculated to the
nearest ten-thousandth) obtained by (i) multiplying (x) the number
of shares covered by a Right immediately prior to this adjustment
by (y) the Purchase Price in effect immediately prior to such
adjustment of the Purchase Price and (ii) dividing the product so
obtained by the Purchase Price in effect immediately after such
adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price to adjust the number of Rights, in
substitution for any adjustment in the number of shares of the
Common Stock purchasable upon the exercise of a Right. Each of the
Rights outstanding after such adjustment of the number of Rights
shall be exercisable for the number of shares of the Common 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 ten-thousandth) obtained by dividing the Purchase
Price in effect immediately prior to adjustment of the Purchase
Price by the Purchase Price in effect immediately after the
adjustment of the Purchase Price. The Company shall make a public
announcement and shall give simultaneous written notice to the
Rights Agent of its election to adjust the number of Rights,
indicating the record date for the adjustment to be made. This
record date may be the date on which the Purchase Price is adjusted
or any day thereafter, but, if the Right Certificates have been
issued, shall be at least 10 days later than the date of the public
announcement. If Right Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section 11(i),
the Company shall, as promptly as practicable, cause to be
distributed to holders of Right Certificates on such record date
Right Certificates evidencing, subject to Section 14, the
additional Rights to which such holders shall be entitled as a
result of such adjustment, or, at the option of the Company, shall
cause to be distributed to such holders of record in substitution
and replacement for the Right Certificates held by such holders
prior to the date of adjustment, and upon surrender thereof, if
required by the Company, new Right Certificates evidencing all the
Rights to which such holders shall be entitled after such
adjustment. Right Certificates so to be distributed shall be
issued, executed and countersigned in the manner provided for
herein (and may bear, at the option of the Company, the adjusted
Purchase Price) and shall be registered in the names of the holders
of record of Right Certificates on the record date specified in the
public announcement.
(j) Irrespective of any adjustment or change in the
Purchase Price or the number of shares of the Common Stock issuable
upon the exercise of the Rights, the Right Certificates theretofore
and thereafter issued may continue to express the Purchase Price
per share and the number of shares which were expressed in the
initial Right Certificates issued hereunder.
(k) Before taking any action that would cause an
adjustment reducing the Purchase Price below the then par value, if
any, of the shares of the Common 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 number of fully paid and
nonassessable shares of such Common Stock at such adjusted Purchase
Price.
(l) In any case in which this Section 11 shall require
that an adjustment in the Purchase Price be made effective as of a
record date for a specified event, the Company may elect to defer
until the occurrence of such event the issuance to the holder of
any Right exercised after such record date of the shares of the
Common Stock and other capital stock or securities of the Company,
if any, issuable upon such exercise over and above the shares of
the Common Stock and other share capital or securities of the
Company, if any, issuable upon such exercise on the basis of the
Purchase Price in effect prior to such adjustment; provided,
however, that the Company shall deliver to such holder a due ▇▇▇▇
or other appropriate instrument evidencing such holder's right to
receive such additional shares upon the ocurrence 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
the Board of Directors of the Company shall determine to be
advisable in order that any consolidation or subdivision of the
Common Stock, issuance wholly for cash of any of the Common Stock
at less than the current market price, issuance wholly for cash of
the Common Stock or securities which by their terms are convertible
into or exchangeable for Common Stock, dividends of shares or
issuance of rights, options or warrants referred to hereinabove in
this Section 11 hereafter made by the Company to holders of its
Common Stock shall not be taxable to such shareholders.
(n) The Company covenants and agrees that, after the
Distribution Date, it will not, except as permitted by Sections 23,
24 and 27 hereof, take (nor will it permit any of its Subsidiaries
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.
(o) The Company covenants and agrees that it shall not,
at any time after a Section 11(a)(ii) Event, (i) combine or
consolidate with any other Person, (ii) merge with or into any
other Person, or (iii) sell or transfer (or permit any of its
Subsidiaries to sell or transfer), in one or more transactions,
assets or earning power aggregating more than 50% of the assets or
earning power of the Company and its wholly-owned Subsidiaries
(taken as a whole) to any other Person or Persons (other than the
Company and/or any of its Subsidiaries in one or more transactions
each of which complies with Section 11(n)) if (x) at the time of or
immediately after such combination, 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 combination, consolidation, merger or sale,
the stockholders of the Person who constitutes, or would
constitute, the "Principal Party" for purposes of Section 13(a)
hereof shall have received a distribution of Rights previously
owned by such Person or any of its Affiliates and Associates.
(p) Notwithstanding anything in this Agreement to the
contrary, prior to the Distribution Date, the Company may, in lieu
of making any adjustment to the Purchase Price, the number of
shares of the Common Stock eligible for purchase on exercise of
each Right or the number of Rights outstanding, which adjustment
would otherwise be required by Sections 11(a)(i), 11(b), 11(c),
11(h) or 11(i), make such other equitable adjustment or adjustments
thereto as the Board of Directors (whose determination shall be
conclusive) deems appropriate in the circumstances and not
inconsistent with the objectives of the Board of Directors in
adopting this Agreement and such Sections.
Section 12. Certificate of Adjusted Purchase Price or
Number of Shares. Whenever an adjustment is made as provided in
Sections 11 and 13, the Company shall (a) promptly prepare a
certificate setting forth such adjustment, and a brief statement of
the facts accounting for such adjustment and the adjusted Purchase
Price, (b) promptly file with the Rights Agent and with each
transfer agent for the Common Stock a copy of such certificate and
(c) mail a brief summary thereof to each holder of a Right
Certificate in accordance with Section 26. The Rights Agent shall
be fully protected in relying on any such certificate and on any
adjustment therein contained.
Section 13. Combination, Consolidation, Merger or Sale
or Transfer of Assets or Earning Power. (a) In the event that,
following a Section 11(a)(ii) Event, directly or indirectly,
(x) the Company shall combine or consolidate with, or merge with or
into, any other Person and the Company shall not be the continuing
or surviving corporation of such combination, consolidation or
merger, (y) any Person shall combine, consolidate or merge with or
into the Company and the Company shall be the continuing or
surviving corporation of such combination, consolidation or merger
and, in connection with such combination, consolidation or merger,
all or part of the Common Stock shall be changed into or exchanged
for shares or other securities of the Company of 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), in one or more transactions, assets or
earning power aggregating more than 50% of the assets or earning
power of the Company and its Subsidiaries (taken as a whole) to any
other Person or Persons (other than the Company or any of its
wholly-owned Subsidiaries in one or more transactions each of which
complies with Section 11(n) hereof), then, and in each such case,
proper provision shall be made so that (i) each holder of a Right
(except as provided in Section 7(e)) shall thereafter have the
right to receive, upon the exercise thereof at the then current
Purchase Price in accordance with the terms of this Agreement, such
number of validly issued, fully paid, nonassessable and freely
tradeable Common Stock of the Principal Party (as hereinafter
defined), not subject to any liens, encumbrances, rights of call or
first refusal, or other adverse claims as shall be equal to the
result obtained by (1) multiplying the then current Purchase Price
by the number of shares of Common Stock for which a Right is then
exercisable immediately prior to the first occurrence of a Section
13 Event (or, if a Section 11(a)(ii) Event has occurred prior to
the first occurrence of a Section 13 Event, multiplying the number
of such shares for which a Right was exercisable immediately prior
to the first occurrence of a Section 11(a)(ii) Event by the
Purchase Price in effect immediately prior to such first
occurrence), and dividing that product (which, following the first
occurrence of a Section 13 Event, shall be referred to as the
"Purchase Price" for each Right and for all purposes of this
Agreement) by (2) 50% of the current market price per share of
Common Stock of such Principal Party (determined in the manner
described in Section 11(d)) on the date of consummation of such
combination, consolidation, merger, sale or transfer; (ii) the
Principal Party shall thereafter be liable for, and shall assume,
by virtue of such Section 13 Event, all the obligations and duties
of the Company pursuant to this Agreement; (iii) the term "Company"
shall thereafter be deemed to refer to such Principal Party, it
being specifically intended that the provisions of Section 11 shall
thereafter apply to such Principal Party, (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) in connection with such consummation as
may be necessary to assure that the provisions hereof shall
thereafter be applicable, as nearly as reasonably may be, in
relation to shares of its Common Stock thereafter deliverable upon
the exercise of the Rights; and (v) the provisions of Section
11(a)(ii) hereof shall be of no effect following the first
occurrence of any Section 13 Event.
(b) "Principal Party" shall mean
(1) in the case of any transaction described in (x) or
(y) of the first sentence of Section 13(a), the Person that is
the issuer of any securities into which shares of Common Stock
of the Company are converted in such merger, combination or
consolidation and, if no securities are so issued, the Person
that is the other party to the merger, combination or
consolidation; and
(2) in the case of any transaction described in (z) of
the first sentence in Section 13(a), the Person that is the
party receiving the greatest portion of the assets or earning
power transferred pursuant to such transaction or
transactions;
provided, however, that in any such case, (x) if the Common Stock
of such Person is not at such time and has not been continuously
over the preceding 12-month period registered under Section 12 of
the Exchange Act, and such Person is a direct or indirect
Subsidiary of another corporation the Common Stock of which are and
have been so registered, "Principal Party" shall refer to such
other corporation; and (y) if such Person is a Subsidiary, directly
or indirectly, of more than one corporation, the Common Stock of
two or more of which are and have been so registered, "Principal
Party" shall refer to whichever of such corporations is the issuer
of the Common Stock having the greatest market value.
(c) The Company shall not consummate any Section 13
Event unless the Principal Party shall have a sufficient number of
authorized shares of Common Stock which are neither outstanding nor
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, as soon as practicable after the date of
any combination, consolidation, merger or sale of assets mentioned
in paragraph (a) of this Section 13, the Principal Party
(i) will prepare and file a registration statement under
the Act with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate
form, will use its best efforts to cause such registration
statement to become effective as soon as practicable after
such filing and will use its best efforts to cause such
registration statement to remain effective (with a prospectus
at all times meeting the requirements of the Act) until the
Expiration Date; and
(ii) will deliver to holders of the Rights historical
financial statements for the Principal Party and each of its
Affiliates which comply in all respects with the requirements
for registration on Form 10 under the Exchange Act.
The provisions of this Section 13 shall similarly apply to
successive Section 13 Events. In the event that a Section 13 Event
shall occur at any time after the occurrence of a Section 11(a)(ii)
Event, the Rights which have not theretofore been exercised shall
thereafter become exercisable in the manner described in Section
13(a).
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue fractions of Rights
or to distribute Right Certificates which evidence fractional
Rights. In lieu of such fractional Rights, the Company shall pay
to the registered holders of the Right Certificates with regard to
which such fractional Rights would otherwise be issuable an amount
in cash equal to the same fraction of the current market value of
a whole Right. For the purposes of this Section 14(a), the current
market value of a whole Right shall be the closing price of the
Rights for the Trading Day immediately prior to the date on which
such fractional Rights would have been otherwise issuable. The
closing price for any day shall be the last sale price, regular
way, or, in case no such sale takes place on such day, the average
of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system
with respect to securities listed or admitted to trading on the New
York Stock Exchange or, if the Rights are not listed or admitted to
trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange on
which the Rights are listed or admitted to trading or, if the
Rights are not listed or admitted to trading on any national
securities exchange, the last quoted price or, if not so quoted,
the average of the high bid and low asked prices in the
over-the-counter market, as reported by 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 the Board of Directors of the Company.
If on any such date no such market maker is making a market in the
Rights, the fair value of the Rights on such date as determined in
good faith by the Board of Directors of the Company shall be used.
(b) The Company shall not be required to issue fractions
of shares or "common stock equivalents" upon exercise or exchange
of the Rights or to distribute certificates which evidence
fractional shares. In lieu of fractional shares, the Company may
pay to the registered holders of Right Certificates at the time the
Rights evidenced thereby are exercised or exchanged as herein
provided an amount in cash equal to the same fraction of the
current market value of one share or "common stock equivalent."
For purposes of this Section 14(b), the current market value of one
share of the Common Stock shall be the closing price of a share of
the Common Stock (as determined pursuant to Section 11(d)) for the
Trading Day immediately prior to the date of such exercise or
exchange, as the case may be, and the current market value of any
"common stock equivalent" shall be the same as the current market
value of a share of the Common Stock on such date.
(c) The holder of a Right by the acceptance of the Right
expressly waives his right to receive any fractional Rights or any
fractional shares upon exercise or exchange of a Right, except as
otherwise permitted by this Section 14.
Section 15. Rights of Action. All rights of action in
respect of this Agreement are vested in the respective registered
holders of the Right Certificates (and, prior to the Distribution
Date, the registered holders of Common Stock); and any registered
holder of any Right Certificate (or, prior to the Distribution
Date, of the Common Stock), without the consent of the Rights Agent
or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Stock), may, in his own behalf and
for his own benefit, enforce, and may institute and maintain any
suit, action or proceeding against the Company to enforce, or
otherwise act in respect of, his right to exercise the Rights
evidenced by such Right Certificate in the manner provided in such
Right Certificate and in this 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 will
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 Right Holders. Every holder of
a Right by accepting the same consents and agrees with the Company
and the Rights Agent and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the
Common Stock;
(b) after the Distribution Date, the Right Certificates
will be transferable only on the registry books of the Rights
Agent if surrendered at the office of the Rights Agent
designated for such purpose, duly endorsed or accompanied by
a proper instrument of transfer and with the appropriate forms
and certificates fully executed, along with a signature
guarantee and such other and further documentation as the
Rights Agent may reasonably request;
(c) subject to Section 6 and Section 7(f) hereof, the
Company and the Rights Agent may deem and treat the Person in
whose name the Right Certificate (or, prior to the
Distribution Date, the associated Common Stock certificate) is
registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership
or writing on the Right Certificates or the associated Common
Stock certificate made by anyone other than the Company or the
Rights Agent) for all purposes whatever, and neither the
Company nor the Rights Agent shall be required to be affected
by any notice to the contrary;
(d) notwithstanding anything in this Agreement to the
contrary, neither the Company nor the Rights Agent shall have
any liability to any holder of a Right or other Person as a
result of its inability to perform any of its obligations
under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court
of competent jurisdiction or by a governmental, regulatory or
administrative agency or commission, or any statute, rule,
regulation or executive order promulgated or enacted by any
governmental authority, prohibiting or otherwise restraining
performance of such obligation; provided, however, that the
Company must use its best efforts to have any such order,
decree or ruling lifted or otherwise overturned as soon as
possible.
Section 17. Right Certificate Holder Not Deemed a
Shareholder. No holder, as such, of any Right Certificate shall be
entitled to vote, receive dividends or be deemed for any purpose
the holder of the Common Stock or any other securities of the
Company which may at any time be issuable on the exercise of the
Rights represented thereby, nor shall anything contained herein or
in any Right Certificate be construed to confer upon the holder of
any Right Certificate, as such, any of the rights of a shareholder
of the Company or any right to vote for the election of directors
or upon any matter submitted to shareholders at any meeting
thereof, or to give or withhold consent to any corporate action, or
to receive notice of meetings or other actions affecting
shareholders (except as provided in Section 25), or to receive
dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Right Certificate shall have been
exercised or exchanged for Common Stock in accordance with the
provisions hereof.
Section 18. Concerning the Rights Agent. The Company
agrees to pay to the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on demand
of the Rights Agent, its reasonable expenses and counsel fees and
other disbursements incurred in the administration and execution of
this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent
for, and to hold it harmless against, any loss, liability, or
expense, incurred without negligence, bad faith or willful
misconduct on the part of the Rights Agent (including the
reasonable fees and expenses of counsel), for anything done or
omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the costs and expenses
of defending against any claim of liability in the premises.
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 Right Certificate or certificate for
the Common Stock or for other securities of the Company, instrument
of assignment or transfer, power of attorney, endorsement,
affidavit, letter, notice, direction, consent, instruction,
adjustment notice, certificate, statement, or other paper or
document believed by it to be genuine and to be signed, executed
and, where necessary, verified or acknowledged, by the proper
Person or Persons.
In addition to the foregoing, the Rights Agent shall be
protected and shall incur no liability for, or in respect of, any
action taken or omitted by it in connection with its administration
of this Agreement in reliance upon (i) the proper execution of the
certification appended to the Form of Assignment and the Form of
Election to Purchase included as part of Exhibit A hereto (the
"Certification"), unless the Rights Agent shall have actual
knowledge that, as executed, the Certification is untrue or
(ii) the non-execution or failure to complete the Certification
including, without limitation, any refusal to honor any otherwise
permissible assignment or election by reason of such non-execution
or failure.
Section 19. Merger or Consolidation or Change of Name of
Rights Agent. 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 business and/or the stock transfer business of the
Rights Agent or any successor Rights Agent, shall be the successor
to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the
parties hereto, provided that such corporation would be eligible
for appointment as a successor Rights Agent under the provisions of
Section 21. In case at the time such successor Rights Agent shall
succeed to the agency created by this Agreement, any of the Right
Certificates shall have been countersigned but not delivered, any
such successor Rights Agent may adopt the countersignature of the
predecessor so countersigned; and in case at that time any of the
Right Certificates shall not have been countersigned, any successor
Rights Agent may countersign such Right Certificates either in the
name of the predecessor Rights Agent or in the name of the
successor Rights Agent; and in all such cases such Right
Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
In case at any time the name of the Rights Agent shall be
changed and at such time any of the Right Certificates shall have
been countersigned but not delivered, the Rights Agent may adopt
the countersignature under its prior name and deliver Right
Certificates so countersigned; and in case at that time any of the
Right Certificates shall not have been countersigned, the Rights
Agent may countersign such Right Certificates either in its prior
name or in its changed name; and in all such cases such Right
Certificates shall have the full force provided in the Right
Certificates and in this 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 Right Certificates, by their acceptance
thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who
may be legal counsel for the Company), and the opinion of such
counsel shall be full and complete authorization and
protection to the Rights Agent as to any action taken or
omitted by it in good faith and in accordance with such
opinion.
(b) Whenever in the performance of its duties under this
Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter be proved or established by
the Company prior to taking or suffering any action hereunder,
such fact or matter (unless other evidence in respect thereof
be herein specifically prescribed) may be deemed to be
conclusively proved and established by a certificate signed by
any one of the Chairman of the Board, the President, any Vice
President, the Treasurer or the Secretary of the Company and
delivered to the Rights Agent; and such certificate shall be
full authorization to the Rights Agent for any action taken or
suffered in good faith by it under the provisions of this
Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for
its own negligence, bad faith or willful misconduct, and the
issuance or non-issuance of a Right Certificate or share of
the Common Stock or other security issued in lieu of Common
Stock in accordance with instructions given to the Rights
Agent by the Company pursuant to Section 20(k) hereof or in
accordance with the terms hereof shall not constitute
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 Right Certificates (except its
countersignature thereof) or be required to verify the same,
but all such statements and recitals are and shall be deemed
to have been made by the Company only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or
the execution and delivery hereof (except the due execution
hereof by the Rights Agent) or in respect of the validity or
execution of any Right Certificate (except its
countersignature thereof); nor shall it be responsible for any
breach by the Company of any covenant or condition contained
in this Agreement or in any Right Certificate; nor shall it be
responsible for any adjustment required under the provisions
of Section 11 or 13 or responsible for the manner, method or
amount of any such adjustment or the ascertaining of the
existence of facts that would require any such adjustment
(except with respect to the exercise of Rights evidenced by
Right Certificates after actual notice of any such
adjustment); nor shall it by any act hereunder be deemed to
make any representation or warranty as to the authorization or
reservation of any shares of the Common Stock to be issued
pursuant to this Agreement or any Right Certificate or as to
whether any shares of the Common Stock will, when issued, be
validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts,
instruments and assurances as may reasonably be required by
the Rights Agent for the carrying out or performing by the
Rights Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its
duties hereunder and certificates delivered pursuant to any
provision hereof from any one of the Chairman of the Board,
the President, any Vice President, the Secretary or the
Treasurer of the Company, and is authorized 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. An application by the
Rights Agent for instructions may set forth in writing any
action proposed to be taken or omitted by the Rights Agent
with respect to its duties and obligations under this
Agreement and the date on and/or after which such action shall
be taken, and the Rights Agent shall not be liable for any
action taken or omitted in accordance with a proposal included
in any such application on or after the date specified therein
(which date shall not be less than one Business Day after the
Company receives such application) without the consent of the
Company unless, prior to taking or omitting such action, the
Rights Agent has received written instructions in response to
an application specifying the actions 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
become pecuniarily interested in any transaction in which the
Company may be interested, or contract with or lend money to
the Company or otherwise act as fully and freely as though it
were not Rights Agent under this Agreement. Nothing herein
shall preclude the Rights Agent from acting in any other
capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty
hereunder either by itself or by or through its attorneys or
agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any
such attorneys or agents or for any loss to the Company
resulting from any such act, default, neglect or misconduct;
provided, however, that reasonable care was exercised in the
selection thereof.
(j) No provision of this Agreement shall require the
Rights Agent to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its
duties hereunder or in the exercise of its rights if there
shall be reasonable grounds for believing that repayment of
such funds or adequate indemnification against such risk or
liability is not reasonably assured to it.
(k) If, with respect to any Right Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate attached to the form of assignment or form of
election to purchase, as the case may be, has either not been
completed or indicates an affirmative response, the Rights
Agent shall not take any further action with respect to such
requested exercise or transfer without first consulting the
Company. The Company shall give the Rights Agent prompt
written instructions as to the action to be taken regarding
the Right Certificates involved. The Rights Agent shall not
be liable for acting in accordance with such instructions.
Section 21. Change of Rights Agent. The Rights Agent or
any successor Rights Agent may resign and be discharged from its
duties under this Agreement upon thirty (30) days' notice in
writing mailed to the Company by registered or certified mail, and,
at the Company's expense, to the holders of the Right Certificates
by first class mail. The Company may remove the Rights Agent or
any successor Rights Agent upon thirty (30) days' notice in
writing, mailed to the Rights Agent or successor Rights Agent, as
the case may be, and to each transfer agent of the Common Stock by
registered or certified mail, and to the holders of the Right
Certificates by first-class mail. If the Rights Agent shall resign
or be removed or shall otherwise become incapable of acting, the
Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of
thirty (30) days after giving notice of such removal or after it
has been notified in writing of such resignation or incapacity by
the resigning or incapacitated Rights Agent or by the holder of a
Right Certificate (who shall, with such notice, submit his Right
Certificate for inspection by the Company), then the Company shall
become the temporary Rights Agent and the registered holder of any
Right Certificate may apply to any court of competent jurisdiction
for the appointment of a new Rights Agent. Any successor Rights
Agent, whether appointed by the Company or by such a court, shall
be (a) a corporation organized and doing business under the laws of
the United States or of the State of New York (or of any other
state of the United States so long as such corporation is
authorized to do business as a banking institution in the State of
New York), in good standing, having a principal office in the State
of New York, which is authorized under such laws to exercise
corporate trust powers and/or stock transfer powers and is subject
to supervision or examination by federal or state authority or
which has at the time of its appointment as Rights Agent a
combined capital and surplus of at least $25 million or (b) a
subsidiary of the corporation described in clause (a) above. After
appointment, the successor Rights Agent shall be vested with the
same powers, rights, duties and responsibilities as if it had been
originally named as Rights Agent without further act or deed; but
the predecessor Rights Agent shall deliver and transfer to the
successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Not later than
the effective date of any such appointment the Company shall file
notice thereof in writing with the predecessor Rights Agent and
each transfer agent of the Common Stock, and mail a notice thereof
in writing to the registered holders of the Right Certificates.
Failure to give any notice provided for in this Section 21,
however, or any defect therein, shall not affect the legality or
validity of the resignation or removal of the Rights Agent or the
appointment of the successor Rights Agent, as the case may be.
Section 22. Issuance of New Right Certificates.
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new
Right Certificates evidencing Rights in such form as may be
approved by its Board of Directors to reflect any adjustment or
change in the Purchase Price and the number or kind or class of
shares or other securities or property purchasable under the Right
Certificates made in accordance with the provisions of this
Agreement. In addition, in connection with the issuance or sale of
shares of the Common Stock following the Distribution Date and
prior to the redemption or expiration of the Rights, the Company
(a) shall, with respect to shares of the Common Stock so issued or
sold pursuant to the exercise of options or under any employee plan
or arrangement, or upon the exercise, conversion or exchange of
securities hereinafter issued by the Company, and (b) may, in any
other case, if deemed necessary or appropriate by the Board of
Directors of the Company, issue Right Certificates representing the
appropriate number of Rights in connection with such issuance or
sale; provided, however, that (i) no such Right 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 Right Certificate would be issued, and (ii) no such Right
Certificate shall be issued if, and to the extent that, appropriate
adjustment shall otherwise have been made in lieu of the issuance
thereof.
Section 23. Redemption and Termination. (a) The Board
of Directors of the Company may, at its option, at any time prior
to the earlier of (x) the close of business on the tenth day
following the Shares Acquisition Date (or if the Shares Acquisition
Date shall have occurred prior to the Record Date, the close of
business on the tenth day following the Record Date), or (y) 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
appropriately adjusted to reflect any stock split, dividend of
shares or similar transaction occurring after the date hereof (such
redemption price being hereinafter referred to as the "Redemption
Price"), and the Company may, at its option, pay the Redemption
Price either in shares of the Common Stock (valued at their current
market price as defined in Section 11(d) on the date of the
redemption), other securities, cash or other assets; provided,
however, that if the Board of Directors of the Company authorizes
redemption of the Rights in either of the circumstances set forth
in clauses (x) or (y) below then there must be Independent
Directors in office and such authorization shall require the
concurrence of a majority of the Independent Directors: (x) such
authorization occurs on or after the Shares Acquisition Date or
(y) such authorization occurs on or after the date of a change
(resulting from a proxy or consent solicitation) in a majority of
the Directors of the Company in office at the commencement of such
solicitation if any Person who is a participant in such
solicitation has stated (or if upon the commencement of such
solicitation a majority of the directors of the Company has
determined in good faith) that such Person (or any of its
Affiliates or Associates) intends to take, or may consider taking,
any action which would result in such Person becoming an Acquiring
Person or which would cause the occurrence of a Triggering Event.
Notwithstanding anything contained in this Agreement to the
contrary, the Rights shall not be exercisable after the first
occurrence of a Section 11(a)(ii) Event until such time as the
Company's right of redemption hereunder has expired, as the same
may be extended pursuant to Section 27.
(b) In deciding whether or not to exercise the Company's
right of redemption hereunder, the directors of the Company shall
act in good faith, in a manner they reasonably believe to be in the
best interests of the Company and with such care, including
reasonable inquiry, skill and diligence, as a person of ordinary
prudence would use under similar circumstances, and they may
consider the long-term and short-term effects of any action upon
employees, customers and creditors of the Company and upon
communities in which offices or other establishments of the Company
are located, and all other pertinent factors.
(c) Immediately upon the action of the Board of
Directors of the Company ordering the redemption of the Rights, and
without any further action and without any notice, the right to
exercise the Rights will terminate and the only right thereafter of
the holders of Rights shall be to receive the Redemption Price for
each Right held. Within 10 days after the action of the Board of
Directors ordering the redemption of the Rights, the Company shall
give notice of such redemption to the holders of the then
outstanding Rights by mailing such notice to the Rights Agent and
to all such holders at their last addresses as they appear upon the
registry books of the Rights Agent or, prior to the Distribution
Date, on the registry books of the Transfer Agent for the Common
Stock. Any notice which is mailed in the manner herein provided
shall be deemed given, whether or not the holder receives the
notice. Each such notice of redemption will state the method by
which the payment of the Redemption Price will be made. Neither
the Comany nor any of its Affiliates or Associates may redeem,
acquire or purchase for value any Rights at any time in any manner
other than that specifically set forth in this Section 23, and
other than in connection with the repurchase of Common Stock prior
to the Distribution Date.
Section 24. Exchange. (a) The Board of Directors of
the Company may, at its option (provided that there are then
Independent Directors in office and a majority of the Independent
Directors concur), at any time and from time to time on or after 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 the provisions of Section 7(e)
hereof) for shares of the Common Stock at an exchange ratio of one
share of the Common Stock per Right, appropriately adjusted to
reflect any stock split, dividend of shares or similar transaction
occurring after the date of this Agreement (such exchange ratio
being hereinafter referred to as the "Exchange Ratio").
(b) Immediately upon the action of the Board of
Directors of the Company ordering the exchange of any Rights
pursuant to subsection (a) of this Section 24 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 shares of the
Common Stock 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 will state the method by
which the exchange will be effected and, in the event of any
partial exchange, the number of Rights which will be exchanged.
Any partial exchange shall be effected pro rata based on the number
of Rights (other than Rights which have become void pursuant to the
provisions of Section 7(e) hereof) held by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the
Company, at its option, may substitute for any share of the Common
Stock exchangeable for a Right (i) "common stock equivalents,"
(ii) cash, (iii) debt securities of the Company, (iv) other assets,
or (v) any combination of the foregoing, having an aggregate value
which a majority of the Independent Directors and the Board of
Directors of the Company shall have determined in good faith to be
equal to the current market price of one share of the Common Stock
(determined pursuant to Section 11(d) hereof) on the Trading Date
immediately preceding the date of exchange pursuant to this
Section 24.
Section 25. Notice of Certain Events. In case the
Company shall propose at any time following the Distribution Date
(a) to pay any dividend payable in shares of any class to the
holders of its Common Stock or to make any other distribution to
the holders of its Common Stock (other than a regular periodic cash
dividend), or (b) to offer to the holders of its Common Stock
rights or warrants to subscribe for or to purchase any additional
shares of the Common Stock or share capital of any class or any
other securities, rights or options, or (c) to effect any
reclassification of its Common Stock (other than a reclassification
involving only the subdivision of outstanding Common Stock), or
(d) to effect any combination, consolidation or merger into or with
any other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(n) hereof), or to effect
any sale or other transfer (or to permit one or more of its
Subsidiaries to effect any sale or other transfer), in one 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 the Company and/or any of its
Subsidiaries in one or more transactions each of which complies
with Sections 11(n) hereof), or (e) to effect the liquidation,
dissolution or winding up of the Company, then, in each such case,
the Company shall give to the Rights Agent and to each holders of
a Right, in accordance with Section 26, a notice of such proposed
action, which shall specify the record date for the purposes of
such dividend of shares, distribution of rights or Rights, or the
date on which such reclassification, combination, consolidation,
merger, sale, transfer, liquidation, dissolution, or winding up is
to to take place and the date of participation therein by the
holders of its Common Stock, if any such date is to be fixed, and
such notice shall be so given in the case of any action covered by
clause (a) or (b) above at least twenty (20) days prior to the
record date for determining holders of its Common Stock for
purposes of such action, and in the case of any such other action,
at least twenty (20)) days prior to the date of the taking of such
proposed action or the date of participation therein by the holders
of its Common Stock, whichever shall be the earlier.
In case a Section 11(a)(ii) Event shall occur, then, in
any such case, the Company shall as soon as practicable thereafter
give to the Rights Agent and to each holder of a Right, to the
extent feasible and in accordance with Section 26, 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) and all references in the preceding paragraph to Common
Stock shall be deemed to thereafter refer to other securities.
Section 26. Notices. Notices or demands authorized by
this Agreement to be given or made by the Rights Agent or by the
holder of any Right Certificate to or on the Company shall be
sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing with
the Rights Agent) as follows:
General Signal Corporation
High Ridge Park, Box 10010
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Subject to the provisions of Section 21, any notice or demand
authorized by this Agreement to be given or made by the Company or
by the holder of any Right Certificate to or on the Rights Agent
shall be sufficiently given or made if sent by first-class mail,
postage prepaid, addressed (until another address is filed in
writing with the Company) as follows:
First Chicago Trust Company of New York
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Tenders and Exchanges Administration
Notices or demands authorized by this Agreement to be
given or made by the Company or the Rights Agent to the holder of
any Right Certificate 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 27. Supplements and Amendments. Prior to the
earlier of the Distribution Date or the Shares Acquisition Date and
subject to the penultimate sentence of this Section 27, the Company
may from time to time supplement or amend this Agreement without
the approval of any holders of Right Certificates. From and after
the earlier of the Distribution Date or the Shares Acquisition
Date, and subject to the penultimate sentence of this Section 27,
the Company may from time to time supplement or amend this
Agreement without the approval of any holders of Right 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 lengthen
the time period during which the Rights may be redeemed following
the Shares Acquisition Date for up to an additional twenty days
beyond the time period set forth in Section 23(a) (provided,
however, that any such lengthening shall be effective only if there
are Independent Directors and shall require the concurrence of a
majority of such Independent Directors) or (iv) to change or
supplement the provisions hereunder in any manner which the Company
may deem necessary or desirable and which shall not adversely
affect the interests of the holders of Right Certificates (other
than an Acquiring Person or an Affiliate or Associate of an
Acquiring Person). Upon the delivery of a certificate from an
appropriate officer of the Company which states that the proposed
supplement or amendment is in compliance with the terms of this
Section 27, the Rights Agent shall execute such supplement or
amendment unless the Rights Agent shall have determined in good
faith that such supplement or amendment would adversely affect its
interests under this Agreement. Notwithstanding anything in this
Agreement to the contrary, no supplement or amendment shall be made
on or after the Distribution Date which changes the Redemption
Price, the Final Expiration Date, the Purchase Price or the number
of shares of the Common Stock for which a Right is then
exercisable. Prior to the earlier of the Shares Acquisition Date
or the Distribution Date, the interests of the holders of Rights
shall be deemed coincident with the interests of the holders of
Common Stock.
Section 28. 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 29. Determinations and Actions by the Board of
Directors, etc. For all purposes of this Agreement, any
calculation of the number of shares of Common Stock outstanding at
any particular time, including for purposes of determining the
particular percentage of such outstanding shares of Common Stock of
which any Person is the Beneficial Owner, shall be made in
accordance with the provisions of Rule 13d-3(d)(1)(i) of the
General Rules and Regulations under the Exchange Act. The Board of
Directors of the Company (and, where specifically provided for
herein, the Independent Directors) shall have the exclusive power
and authority to administer this Agreement and to exercise all
rights and powers specifically granted to the Board or the Company
(or, as expressly provided, the Independent Directors), or as may
be necessary or advisable in the administration of this Agreement,
including, without limitation, the right and power to (i) interpret
the provisions of this Agreement, and (ii) make all determinations
deemed necessary or advisable for the administration of this
Agreement (including a determination to redeem or not redeem the
Rights or to amend the Agreement). All such actions, calculations,
interpretations and determinations (including, for the purpose of
clause (ii) below, all omissions with respect to the foregoing)
which are done or made by the Board (or, as provided for, by the
Independent Directors) in good faith, shall (i) be final,
conclusive and binding on the Company, the Rights Agent, the
holders of the Right Certificates and all other parties, and
(ii) not subject the Board or the Independent Directors to any
liability to the holders of the Right Certificates.
Section 30. Benefits of This Agreement. Nothing in this
Agreement shall be construed to give to any Person other than the
Company, the Rights Agent and the registered holders of the Right
Certificates (and, prior to the Distribution Date, the 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 Right Certificates (and, prior to the Distribution Date,
registered holders of the Common Stock).
Section 31. Severability. If any term, provision,
covenant, or restriction of this Agreement is held by a court of
competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants
and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated;
provided, however, that notwithstanding anything in this Agreement
to the contrary, if any such term, provision, covenant or
restriction is held by such court or authority to be invalid, void
or unenforceable and the Board of Directors of the Company
determines in its good faith judgment that severing the invalid
language from this Agreement would adversely affect the purpose or
effect of this Agreement, the right of redemption set forth in
Section 23 hereof shall be reinstated and shall not expire until
the close of business on the tenth day following the date of such
determination by the Board of Directors.
Section 32. Governing Law. This Agreement and each
Right Certificate issued hereunder shall be deemed to be a contract
made under the laws of the State of New York and for all purposes
shall be governed by and construed in accordance with the laws of
such State applicable to contracts to be made and performed
entirely within such State.
Section 33. Counterparts. This Agreement may be
executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and the
same instrument.
Section 34. Descriptive Headings. Descriptive headings
of the several Sections of this Agreement are inserted for
convenience only and shall not control or affect the meaning or
construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and their respective corporate seals
to be hereunto affixed and attested, all as of the day and year
first above written.
[SEAL]
GENERAL SIGNAL CORPORATION
Attest: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
By:
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: President and Chief
Operating Officer
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
By: __________________________
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Title: Vice President, General
Counsel and Secretary
[SEAL]
FIRST CHICAGO TRUST COMPANY
OF NEW YORK
Attest: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
By:
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Assistant Vice
President
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
By: _____________________
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
EXHIBIT A
[Form of Right Certificate]
Certificate No. R- ________ Rights
NOT EXERCISABLE AFTER MARCH 21, 2006 OR EARLIER IF
NOTICE OF REDEMPTION OR EXCHANGE IS GIVEN. THE
RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF
THE COMPANY, AT $.01 PER RIGHT AND TO EXCHANGE ON
THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES RIGHTS MAY NOT BE
EXERCISABLE.
FIRST CHICAGO TRUST COMPANY
Right Certificate
This certifies that , or registered
assigns, is the registered owner of the number of Rights set forth
above, each of which entitles the owner thereof, subject to the
terms, provisions and conditions of the Rights Agreement dated as
of February 1, 1996 (the "Rights Agreement") between GENERAL SIGNAL
CORPORATION, a New York corporation (the "Company"), and FIRST
CHICAGO TRUST COMPANY OF NEW YORK, a New York corporation (the
"Rights Agent"), to purchase from the Company at any time after the
Distribution Date (as such term is defined in the Rights Agreement)
and prior to 5:00 P.M. (New York City time) on March 21, 2006 at
the designated office of the Rights Agent, or its successors as
Rights Agent, in New York, New York, one fully paid and
nonassessable share of the Common Stock, $1.00 par value (the
"Common Stock"), of the Company, at a purchase price of $150.00 per
share (the "Purchase Price"), upon presentation and surrender of
this Right Certificate with the Form of Election to Purchase and
related certificate duly executed, along with a signature guarantee
and such other and further documentation as the Rights Agent may
reasonably request. The number of Rights evidenced by this Right
Certificate (and the number of shares which may be purchased upon
exercise thereof) set forth above, and the Purchase Price per share
set forth above, are the number and Purchase Price as of March 21,
1996, based on the shares of the Common Stock of the Company as
constituted at such date.
Upon the occurrence of a Section 11(a)(ii) Event (as such
term is defined in the Rights Agreement), if the Rights evidenced
by this Right Certificate are beneficially owned by (i) an
Acquiring Person or an Affiliate or Associate of any such Acquiring
Person (as such terms are defined in the Rights Agreement), (ii) a
transferee of any such Acquiring Person, Associate of Affiliate, or
(iii) under certain circumstances specified in the Rights
Agreement, a transferee of a person who after such transfer, became
an Acquiring Person, such Rights shall become null and void and no
holder hereof shall have any right with respect to such Rights from
and after the occurrence of such Section 11(a)(ii) Event.
As provided in the Rights Agreement, the Purchase Price
and the number of shares of the Common Stock (or, in certain
circumstances, other securities) which may be purchased upon the
exercise of the Rights evidenced by this Right Certificate are
subject to modification and adjustment upon the happening of
certain events, including Triggering Events (as such term is
defined in the Rights Agreement).
This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder
of the Rights Agent, the Company and the holders of the Right
Certificates. Copies of the Rights Agreement are on file at the
above-mentioned office of the Rights Agent, and at the executive
offices of the Company.
This Right Certificate, with or without other Right
Certificates, upon surrender at the designated office of the Rights
Agent, along with a signature guarantee and such other and further
documentation as the Rights Agent may reasonably request, may be
exchanged for another Right Certificate or Right Certificates of
like tenor and date evidencing Rights entitling the holder to
purchase a like aggregate number of shares of the Common Stock as
the Rights evidenced by the Right Certificate or Right Certificates
surrendered shall have entitled such holder to purchase. If this
Right Certificate shall be exercised in part, the holder shall be
entitled to receive upon surrender hereof, along with a signature
guarantee and such other and further documentation as the Rights
Agent may reasonably request, another Right Certificate or Right
Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate (a) may be redeemed by the
Company at its option at a redemption price of $.01 per Right prior
to the earlier of the close of business on (i) the tenth day
following the Shares Acquisition Date and (ii) the Final Expiration
Date or (b) may be exchanged in whole or in part for shares of the
Common Stock, and/or other securities, cash or other assets of the
Company deemed to have the same value as shares of the Common
Stock, at any time after a Section 11(a)(ii) Event.
No fractional shares of the Common Stock (or other
securities) will be issued upon the exercise or exchange of any
Right or Rights evidenced hereby, but in lieu thereof a cash
payment will be made, as provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to
vote or receive dividends or be deemed for any purpose the holder
of the Common Stock or of any other securities of the Company which
may at any time be issuable on the exercise hereof, nor shall
anything contained in the Rights Agreement or herein be construed
to confer upon the holder hereof, as such, any of the rights of a
shareholder of the Company or any right to vote for the election of
directors or upon any matter submitted to shareholders at any
meeting thereof, or to give or withhold consent to any corporate
action, or to receive notice of meetings or other actions affecting
shareholders (except as provided in the Rights Agreement), or to
receive dividends or subscription rights, or otherwise, until the
Right or Rights evidenced by this Right Certificate shall have been
exercised or exchanged for shares of the Common Stock as provided
in the Rights Agreement.
This Right Certificate shall not be valid or obligatory
for any purpose until it shall have been countersigned by the
Rights Agent.
WITNESS the facsimile signature of the proper officers of
the Company and its corporate seal. Dated as of , .
[SEAL]
ATTEST: GENERAL SIGNAL CORPORATION
By: ________________________ By:
Name: Name:
Title: Title:
Countersigned:
FIRST CHICAGO TRUST COMPANY
OF NEW YORK,
as Rights Agent
By: _______________________
Authorized Signature
Date:
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificates.)
FOR VALUE RECEIVED __________________________ hereby
sells, assigns and transfers unto
(please print name and address of transferee)
this Right Certificate, together with all right, title and interest
therein, and does hereby irrevocably constitute and appoint
_____________ Attorney, to transfer the within Right Certificate on
the books of the within-named Company, with full power of
substitution.
Dated: _______________, ____
Signature
Signature Guaranteed:
(Signatures must be guaranteed.)
CERTIFICATE
The undersigned hereby certifies by checking the
appropriate box that:
Exercising this Right Certificate will not
enable the undersigned, its Affiliates, its Associates
and/or any other Person with which the undersigned or any of the
undersigned's Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing) for the
purpose of acquiring, holding, voting or disposing of securities of
the Company to obtain individually or in the aggregate in excess of
____ shares of the Common Stock of the Company.
Dated: __________, ____
Signature
Signature Guaranteed:
(Signatures must be guaranteed.)
NOTICE
The signature to the foregoing Assignment and Certificate
must correspond to the name as written upon the face of this Right
Certificate in every particular, without alteration or enlargement
or any change whatsover.
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise
Rights evidenced by the Right Certificate.)
To General Signal Corporation:
The undersigned hereby irrevocably elects to exercise
__________________ Rights represented by this Right Certificate to
purchase the shares of the Common Stock issuable upon the exercise
of such Rights (or such other securities of the Company or of any
other Person which may be issuable upon the exercise of the Rights)
and requests that certificates for such shares be issued in the
name of:
Please insert social security or
other taxpayer identifying number
(Please print name and address)
If such number of Rights shall not be all the Rights
evidenced by this Right Certificate, a new Right Certificate for
the balance remaining of such Rights shall be registered in the
name of and delivered to:
Please insert social security or
other taxpayer identifying number
(Please print name and address)
Dated: ____________, ____
Signature
Signature Guaranteed:
(Signatures must be guaranteed.)
CERTIFICATE
The undersigned hereby certifies by checking the
appropriate box that:
Exercising the Rights evidenced by this Right Certificate
will not enable the undersigned, its Affiliates, its
Associates and/or any other Person with which the undersigned or
any of the undersigned's Affiliates or Associates has any
agreement, arrangement or understanding (whether or not in writing)
for the purpose of acquiring, holding, voting or disposing of
securities of the Company to obtain individually or in the
aggregate in excess of ____ shares of the Common Stock of the
Company.
Dated: ________________, ____ ________________________
Signature
NOTICE
The signature to the foregoing Election to Purchase and
Certificate must correspond to the name as written upon the face of
this Right Certificate in every particular, without
alteration or enlargement or any change whatsoever.
EXHIBIT B
SUMMARY OF RIGHTS TO PURCHASE
COMMON STOCK
On February 1, 1996 the Board of Directors of GENERAL
SIGNAL CORPORATION (the "Company") declared a dividend distribution
of one Right for each outstanding share of Common Stock, $1.00 par
value (the "Common Stock"), of the Company. The distribution is
payable on March 21, 1996 (the "Record Date") to the shareholders
of record on the Record Date. Each Right entitles the registered
holder to purchase from the Company one share of the Common Stock
at a price of $150.00 per share (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights are set forth
in a Rights Agreement (the "Rights Agreement") between the Company
and First Chicago Trust Company of New York, as Rights Agent (the
"Rights Agent").
Distribution Date; Transfer of Rights
Until the earlier to occur of (i) ten days following the
date (the "Shares Acquisition Date") of the public announcement
that a person or group of affiliated or associated persons (an
"Acquiring Person") has acquired, or obtained the right to acquire,
beneficial ownership of a number of shares of the Common Stock
equal to 20% or more of the outstanding shares of the Common Stock
or (ii) ten days following the commencement or announcement of an
intention to make a tender offer or exchange offer if, upon
consummation thereof, such person would be an Acquiring Person (the
earlier of such dates being called the "Distribution Date"), the
Rights will be evidenced, with respect to any of the Common Stock
certificates outstanding as of the Record Date, by such Common
Stock certificate. The Rights Agreement provides that, until the
Distribution Date, the Rights will be transferred with and only
with the Common Stock. Until the Distribution Date (or earlier
redemption or expiration of the Rights), new Common Stock
certificates issued after the Record Date upon transfer or new
issuance of the Common Stock will contain a notation incorporating
the Rights Agreement by reference. Until the Distribution Date (or
earlier redemption or expiration of the Rights), the surrender for
transfer of any of the Common Stock certificates outstanding as of
the Record Date will also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate.
As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be
mailed to holders of record of the Common Stock as of the close of
business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution
Date. The Rights will expire at the close of business on March 21,
2006, unless earlier redeemed or exchanged by the Company as
described below.
Exercise of Rights for Shares of
the Common Stock of the Company_
In the event that a Person becomes an Acquiring Person at
any time following the Distribution Date, each holder of a Right
will thereafter have the right to receive, upon exercise, shares of
the Common Stock (or, in certain circumstances, cash, property or
other securities of the Company) having a value equal to two times
the Purchase Price of the Right then in effect. Notwithstanding
any of the foregoing, following the occurrence of the event set
forth in this paragraph, all Rights that are, or (under certain
circumstances specified in the Rights Agreement) were, beneficially
owned by any Acquiring Person will be null and void.
Exercise of Rights for Shares of the Acquiring Company
In the event that, at any time following a Section
11(a)(ii) Event, (i) the Company is acquired in a merger or other
business combination transaction, or (ii) 50% or more of the
Company's assets or earning power is sold or transferred, each
holder of a Right (except Rights which previously have been voided
as set forth above) shall thereafter have the right to receive,
upon exercise, ordinary shares of the acquiring company having a
value equal to two times the Purchase Price of the Right then in
effect. The events set forth in this paragraph and in the
preceding paragraph are referred to as the "Triggering Events."
Adjustments to Purchase Price
The Purchase Price payable, and the number of shares of
the Common Stock (or other securities, as the case may be) issuable
upon exercise of the Rights are subject to adjustment from time to
time to prevent dilution (i) in the event of a dividend of shares
on, or a subdivision, combination or reclassification of, the
Common Stock, (ii) upon the grant to holders of the Common Stock of
certain rights or warrants to subscribe for shares of the Common
Stock or convertible securities at less than the current market
price of the Common Stock or (iii) upon the distribution to holders
of the Common Stock of evidences of indebtedness or assets
(excluding regular periodic cash dividends or dividends payable in
the Common Stock) or of subscription rights or warrants (other than
those referred to above). Prior to the Distribution Date, the
Board of Directors of the Company may make such equitable
adjustments as it deems appropriate in the circumstances in lieu of
any adjustment otherwise required by the foregoing.
With certain exceptions, no adjustment in the Purchase
Price will be required until the earlier of (i) three years from
the date of the event giving rise to such adjustment or (ii) the
time at which cumulative adjustments require an adjustment of at
least 1% in such Purchase Price. No fractional shares will be
issued and, in lieu thereof, an adjustment in cash will be made
based on the market price of the Common Stock on the last trading
date prior to the date of exercise.
Redemption and Exchange of Rights
At any time prior to 5:00 P.M. New York City time on the
tenth day following the Shares Acquisition Date, the Company may
redeem the Rights in whole, but not in part, at a price of $.01 per
Right (the "Redemption Price"). Under certain circumstances set
forth in the Rights Agreement, the decision to redeem shall require
the concurrence of a majority of the Independent Directors.
Immediately upon the action of the Board of Directors of the
Company electing to redeem the Rights with, if required, the
concurrence of the Independent Directors, the Company shall make
announcement thereof, and upon such action, the right to exercise
the Rights will terminate and the only right of the holders of
Rights will be to receive the Redemption Price.
At any time after the occurrence of any of the events set
forth under the heading "Exercise of Rights for shares of the
Common Stock of the Company" above, the Board of Directors may
exchange the Rights (other than Rights owned by an Acquiring
Person, which have become void), in whole or in part, at an
exchange ratio of one share of the Common Stock, and/or other
securities, cash or other assets deemed to have the same value as
one share of the Common Stock, per Right, subject to adjustment.
Until the Rights are exercised or exchanged for shares of
the Common Stock, the holders thereof, as such, will have no
rights as shareholders of the Company, including, without
limitation, the right to vote or to receive dividends.
Amendments to Terms of the Rights
Any of the provisions of the Rights Agreement may be
amended by the Board of Directors of the Company prior to the
Distribution Date. After the Distribution Date, the provisions of
the Rights Agreement may be amended by the Board in order to cure
any ambiguity, defect or inconsistency, or to make changes which do
not adversely affect the interests of holders of Rights (excluding
the interest of any Acquiring Person); provided, that no supplement
or amendment may be made on or after the Distribution Date which
changes those provisions relating to the principal economic terms
of the Rights. The Board may also, with the concurrence of a
majority of the Independent Directors, extend the redemption period
for up to an additional 20 days.
The term "Independent Directors" means any member of the
Board of Directors of the Company who was a member of the Board
prior to the time that any person becomes an Acquiring Person, and
any person who is subsequently elected to the Board if such person
is recommended or elected by a majority of the Independent
Directors, but shall not include an Acquiring Person or any
representative thereof.
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an Exhibit to a Registration
Statement on Form 8-A dated February 7, 1996. A copy of the Rights
Agreement is available free of charge from the Company. This
summary description of the Rights does not purport to be complete
and is qualified in its entirety by reference to the Rights
Agreement, which is hereby incorporated herein by reference.