1
Exhibit 1
MALLINCKRODT GROUP INC.
and
THE FIRST NATIONAL BANK OF CHICAGO
Rights Agent
Amended and Restated
Rights Agreement
Dated as of February 19, 1996 i
TABLE OF CONTENTS
Page
Section 1. Certain Definitions . . . . . . . . . . . . . . . . . . . . 2
Section 2. Appointment of Rights Agent . . . . . . . . . . . . . . . . 8
Section 3. Issue of Right Certificates . . . . . . . . . . . . . . . . 8
Section 4. Form of Right Certificates . . . . . . . . . . . . . . . . 11
Section 5. Countersignature and Registration . . . . . . . . . . . . 12
Section 6. Transfer, Split Up, Combination and
Exchange of Right Certificates;
Mutilated, Destroyed, Lost or
Stolen Right Certificates . . . . . . . . . . . . . . . 13
Section 7. Exercise of Rights; Purchase Price;
Expiration Date of Rights . . . . . . . . . . . . . . . 14
Section 8. Cancellation and Destruction of
Right Certificates . . . . . . . . . . . . . . . . . . . 17
Section 9. Reservation and Availability of
Shares of Common Stock . . . . . . . . . . . . . . . . . 17
Section 10. Common Stock Record Date . . . . . . . . . . . . . . . . . 19
Section 11. Adjustment of Purchase Price,
Number of Shares or
Number of Rights . . . . . . . . . . . . . . . . . . . . 20
Section 12. Certificate of Adjusted Purchase
Price or Number of Shares . . . . . . . . . . . . . . . 31
Section 13. Adjustments to Rights in Event
of Certain Transactions . . . . . . . . . . . . . . . . 31
Section 14. Fractional Rights and Fractional Shares . . . . . . . . . 37
Section 15. Rights of Action . . . . . . . . . . . . . . . . . . . . . 39
Section 16. Agreement of Right Holders . . . . . . . . . . . . . . . . 40
Section 17. Right Certificate Holder Not
Deemed a Stockholder . . . . . . . . . . . . . . . . . . 41
Section 18. Concerning the Rights Agent . . . . . . . . . . . . . . . 41
Section 19. Merger or Consolidation or Change
of Name of Rights Agent . . . . . . . . . . . . . . . . . 42
Section 20. Duties of Rights Agent . . . . . . . . . . . . . . . . . . 44
Section 21. Change of Rights Agent . . . . . . . . . . . . . . . . . . 48
Section 22. Issuance of New Right Certificates . . . . . . . . . . . . 50
Section 23. Redemption . . . . . . . . . . . . . . . . . . . . . . . . 50
Section 24. Notice of Proposed Actions . . . . . . . . . . . . . . . . 51
Section 25. Notices . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 26. Powers of the Board of Directors . . . . . . . . . . . . . 54
Section 27. Supplements and Amendments . . . . . . . . . . . . . . . . 55
Section 28. Successors . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 29. Benefits of this Rights Agreement . . . . . . . . . . . . 56
ii
Page
Section 30. Governing Law . . . . . . . . . . . . . . . . . . . . . . 56
Section 31. Severability . . . . . . . . . . . . . . . . . . . . . . . 56
Section 32. Counterparts . . . . . . . . . . . . . . . . . . . . . . . 57
Section 33. Descriptive Headings . . . . . . . . . . . . . . . . . . . 57
Exhibit A - Form of Right Certificate
Exhibit B - Summary of Rights to Purchase Common Stock
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AMENDED AND RESTATED RIGHTS AGREEMENT
This Amended and Restated Rights Agreement between Mallinckrodt
Group Inc. (formerly International Minerals & Chemical Corporation), a New
York corporation (the "Company"), and The First National Bank of Chicago
(the "Rights Agent"), dated as of March 19, 1986, as amended and restated
on March 10, 1989, as further amended on April 17, 1991 and as further
amended and restated on February 19, 1996 (the "Rights Agreement").
W I T N E S S E T H :
WHEREAS, the Board of Directors of the Company has authorized
and declared a dividend distribution of one Right for each share of Common
Stock, $1 par value per share, of the Company outstanding on March 31, 1986
and has authorized the issuance of one Right in respect of each share of
Common Stock of the Company issued between March 31, 1986 and the earlier
of the Distribution Date, the Expiration Date or the Final Expiration Date
(as such terms are hereinafter defined), each Right currently representing
the right to purchase one share of Common Stock of the Company upon the
terms and subject to the conditions hereinafter set forth (the "Rights");
and
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WHEREAS, the Board of Directors has approved and authorized the
First Amendment to this Rights Agreement, dated as of March 10, 1989, the
Second Amendment to this Rights Agreement, dated as of April 17, 1991 and
certain other amendments to this Rights Agreement, dated as of February 19,
1996, between the Company and the Rights Agent; and
WHEREAS, the parties by these presents have restated and
re-executed the Rights Agreement as so amended;
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 Rights
Agreement, the following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person together with any
Associate or Affiliate of such Person, who shall be the Beneficial Owner of
outstanding securities of the Company constituting a Substantial Block;
provided, however, that the term "Acquiring Person" shall not include any
Person (i) who shall become the Beneficial Owner of 20% or more of the
outstanding shares of Common Stock solely as a result of an acquisition by
the Company of shares of Common Stock, until such time thereafter as any
such Person shall become the Beneficial Owner (other than by means of a
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stock dividend or stock split) of an additional 1% of the outstanding
shares of Common Stock, (ii) who shall become a Beneficial Owner of 20% or
more of the outstanding shares of Common Stock solely as a result of the
grant or exercise of an option granted to such Person by the Company in
connection with an agreement to merge with, or acquire, the Company entered
into prior to a Flip-in Date, or (iii) any employee stock ownership or
other employee benefit plan of the Company or a wholly-owned subsidiary of
the Company.
(b) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Securities Exchange Act of 1934 (the "Exchange Act"),
as in effect on March 19, 1986.
(c) A Person shall be deemed the "Beneficial Owner" of any
securities:
(i) which such Person or any of such Person's Affiliates or
Associates beneficially owns, directly or indirectly;
(ii) which such Person or any of such Person's Affiliates or
Associates has (A) the right to acquire (whether such right is
exercisable immediately or only after the passage of time) pursuant
to any agreement, arrangement or understanding, or upon the exercise
of conversion rights, exchange rights, rights (other than
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these Rights), warrants or options, or otherwise; provided, however,
that a Person shall not be deemed the "Beneficial Owner" of
securities tendered pursuant to a tender offer made by such Person or
any of such Person's Affiliates or Associates until such tendered
securities are accepted for payment; or (B) the right to vote
pursuant to any agreement, arrangement or understanding; provided,
however, that a Person shall not be deemed the Beneficial Owner of,
or to "beneficially own," any security under this clause (B) 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 also then reportable on Schedule 13D under the Exchange
Act (or any comparable or successor report); or
(iii) which are beneficially owned, directly or indirectly, by
any other Person with which such Person or any of such Person's
Affiliates or Associates has any agreement, arrangement or
understanding (but excluding customary agreements with and between
underwriters and selling group members with respect to a bona fide
public offering of securities until the
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expiration of forty days after the date of such acquisition) for the
purpose of acquiring, holding, voting (except pursuant to a revocable
proxy as described in clause (B) of subparagraph (ii) of this
paragraph (c)) or disposing of any securities of the Company.
(d) "Business Day" shall mean any day other than a Saturday,
Sunday, or a day on which banking institutions in the State of Missouri are
authorized or obligated by law or executive order to close.
(e) "close of business" on any given date shall mean 5:00
P.M., St. Louis time, on such date; provided, however, that if such date is
not a Business Day it shall mean 5:00 P.M., St. Louis time, on the next
succeeding Business Day.
(f) "Common Stock" shall mean the Common Stock, $1 par value
per share, of the Company.
(g) "Distribution Date" shall mean the close of business on
the earlier of (i) the Stock Acquisition Date or (ii) the tenth Business
Day (or such later date as may be fixed from time to time by the Board of
Directors of the Company and publicly announced by the Company) after the
date on which any Person (other than the Company, a wholly-owned subsidiary
of the Company or an employee stock ownership or other employee benefit
plan of the Company or a
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wholly-owned subsidiary of the Company) commences a tender or exchange
offer to acquire (when added to any shares as to which such Person is the
Beneficial Owner immediately prior to such tender or exchange offer)
Beneficial Ownership of 30% or more of the outstanding shares of Common
Stock, provided that, if any tender or exchange offer referred to in clause
(ii) of this definition is cancelled, terminated or otherwise withdrawn
prior to the Distribution Date, such offer shall be deemed, for purposes of
this definition, never to have been made.
(h) "Expiration Date" shall have the meaning set forth in
Section 7(a).
(i) "Final Expiration Date" shall have the meaning set forth
in Section 7(a).
(j) "Flip-in Date" shall mean any Stock Acquisition Date which
is not the result of a Flip-over Transaction or Event.
(k) "Flip-over Stock" of any Person shall mean the capital
stock (or similar equity interest) with the greatest voting power in
respect of the election of directors (or similar persons responsible for
direction of the business and affairs) of such other Person or, if such
other Person is a subsidiary of another Person, the Person or Persons which
ultimately controls such first-mentioned Person.
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(l) "Flip-over Transaction or Event" shall mean a transaction
or series of transactions on or after the Stock Acquisition Date in which,
directly or indirectly, (A) the Company shall consolidate or merge with any
other Person or (B) the Company shall sell or otherwise transfer (or one or
more of its Subsidiaries shall sell or otherwise transfer) assets (i)
aggregating more than 50% of the assets (measured by either book value or
fair market value) or (ii) generating more than 50% of the operating income
or cash flow of the Company and its Subsidiaries (taken as a whole) to any
other Person (other than the Company or one or more of its wholly-owned
Subsidiaries) or to two or more such Persons which are affiliated or
otherwise acting in concert.
(m) "Person" shall mean any individual, firm, partnership,
association, group (as such term is used in Rule 13d-5 under the Exchange
Act, as such Rule was in effect on March 10, 1989), corporation or other
entity.
(n) "Stock Acquisition Date" shall mean the first date on
which any Person, together with any Associate or Affiliate, becomes an
Acquiring Person.
(o) "Subsidiary" shall mean any corporation or other entity of
which securities or other ownership interests having ordinary voting power,
in the absence of contingencies, to elect a majority of the board of
directors or other persons performing similar functions are at the
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time directly or indirectly owned by another corporation or other entity.
(p) "Substantial Block" shall mean a number of shares of
Common Stock which equals or exceeds 20% of the number of shares of Common
Stock then outstanding.
Section 2. Appointment of Rights Agent. The Company hereby
appoints the Rights Agent to act as agent for the Company and the record
holders of the Rights (who, in accordance with Section 3 hereof, shall
prior to and as of the Distribution Date also be the record holders of the
Common Stock) in accordance with the terms and conditions hereof, and the
Rights Agent hereby accepts such appointment. The Company may from time to
time appoint such Co-Rights Agents as it may deem necessary or desirable.
Section 3. Issue of Right Certificates. (a) Until the close
of business on the Distribution Date, (x) the Rights will be evidenced
(except as otherwise provided in Section 3(b) hereof) by the certificates
for the Common Stock registered in the names of the holders of the Common
Stock (which certificates for Common Stock shall also be deemed to be Right
Certificates) and not by separate Right Certificates, as more fully set
forth below, and (y) the right to receive Right Certificates will be
transferable only in connection with the transfer of Common Stock. As soon
as practicable after the Company has notified the
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Rights Agent of the occurrence of the Distribution Date, the Rights Agent
will send, by first-class, insured, postage prepaid mail, to each record
holder of the Common Stock as of the close of business on the Distribution
Date, at the address of such holder shown on the records of the Company, a
Right Certificate, in substantially the form of Exhibit A hereto,
evidencing one Right for each share of Common Stock so held. As of the
close of business on the Distribution Date, the Rights will be evidenced
solely by such Right Certificates.
(b) On March 31, 1986 or as soon as practicable thereafter,
the Company will send a copy of a Summary of Rights to Purchase Common
Stock, in substantially the form of Exhibit B hereto (the "Summary of
Rights"), by first-class, postage prepaid mail, to each record holder of
the Common Stock as of the close of business on March 31, 1986, at the
address of such holder shown on the records of the Company. With respect
to certificates for the Common Stock outstanding on or after March 31,
1986, until the close of business on the Distribution Date, the Rights will
be evidenced by such certificates for the Common Stock registered in the
names of the record holders of the Common Stock. Until the close of
business on the Distribution Date, the surrender for transfer of any of the
certificates for the Common Stock outstanding on or after March 31, 1986,
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with or without a copy of the Summary of Rights attached thereto and
without regard to any legend set forth (or not set forth) thereon, shall
also constitute the transfer of the Rights associated with the Common Stock
represented by such certificate.
(c) Certificates for the Common Stock issued after
February 19, 1996, but prior to the earlier of the close of business on the
Distribution Date or the Expiration Date or the Final Expiration Date,
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 a certain Right or Rights as set
forth in a Rights Agreement between Mallinckrodt
Group Inc. (formerly International Minerals &
Chemical Corporation) and the First National Bank
of Chicago, dated as of March 19, 1986, as amended
and restated on March 10, 1989, as further amended
on April 17, 1991 and as further amended and
restated on February 19, 1996 (as it may be further
amended, 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 Mallinckrodt Group Inc. Under
certain circumstances, as set forth in the Rights
Agreement, such Right or Rights may be redeemed,
may expire, may be exchanged for shares of Common
Stock or other securities or assets of the Company,
may become void (if they are "Beneficially Owned"
by an "Acquiring Person" or an Affiliate or
Associate thereof, as such terms are defined in the
Rights Agreement, or by any
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transferee of the foregoing) or may be evidenced by
separate certificates, at which time it or they
shall no longer be evidenced by this certificate.
For so long as this certificate represents an
exercisable Right or Rights, Mallinckrodt Group
Inc. will mail to the holder of this certificate a
copy of the Rights Agreement without charge within
five business days after receipt of a written
request therefor.
Section 4. Form of Right Certificates. 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 Rights
Agreement, or as may be required to comply with any applicable law, rule or
regulation or with any rule or regulation of any stock exchange on which
the Rights may from time to time be listed, or to conform to usage.
Subject to the provisions of Section 22 hereof, the Right Certificates,
whenever issued, shall be dated as of February 19, 1996, and on their face
shall entitle the holders thereof to purchase such number of shares of
Common Stock 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
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Purchase Price shall be subject to adjustments as provided in Section 11 or
13 hereof.
Section 5. Countersignature and Registration. The Right
Certificates shall be executed on behalf of the Company by its Chairman of
the Board, its President or any Vice President, either manually or by
facsimile signature, and have affixed thereto the Company's seal or a
facsimile thereof which shall be attested by the Secretary or an Assistant
Secretary of the Company, either manually or by facsimile signature. The
Right Certificates shall be manually countersigned by the Rights Agent and
shall not be valid for any purpose unless so countersigned. In case any
officer of the Company whose manual or facsimile signature is affixed to
the Right Certificates shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by the
Company, such Right Certificates, nevertheless, may be countersigned by the
Rights Agent, issued and delivered with the same force and effect as though
the person who signed such Right Certificates had not ceased to be such
officer of the Company. Any Right Certificate may be signed on behalf of
the Company by any person who, at the actual date of the execution of such
Right Certificate, shall be a proper officer of the Company to sign such
Right Certificate,
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although at the date of the execution of this Rights Agreement any such
person was not such an officer.
Following the close of business on the Distribution Date, the
Rights Agent will keep or cause to be kept, at one of its offices in
Chicago, Illinois, books for registration and transfer of the Right
Certificates issued hereunder. Such books shall show the names and
addresses of the respective holders of the Right Certificates, the number
of Rights evidenced on its face by each of the Right Certificates and the
date of each of the Right Certificates.
Section 6. Transfer, Split-Up, Combination and Exchange of
Right Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates. 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 or the Final Expiration Date,
any Right Certificate or Certificates, may be transferred, split up,
combined or exchanged for another Right Certificate or Right Certificates,
entitling the record holder to purchase a like number of shares of Common
Stock as the Right Certificate or Right Certificates surrendered then
entitled such holder to purchase. Any record holder desiring to transfer,
split up, combine or exchange any Right Certificate or Right Certificates
shall make such request in writing delivered to the Rights Agent,
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and shall surrender the Right Certificate or Right Certificates to be
transferred, split up, combined or exchanged at the principal office of the
Rights Agent. Thereupon the Rights Agent shall countersign and deliver to
the person entitled thereto a Right Certificate or Right Certificates, as
the case may be, as so requested. The Company may require payment of a sum
sufficient to cover any 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, and
reimbursement to the Company and the Rights Agent of all reasonable
expenses incidental thereto, and upon surrender to the Rights Agent and
cancellation of the Right Certificate, if mutilated, the Company will make
and deliver a new Right Certificate of like tenor to the Rights Agent for
delivery to the record 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) The record holder of any Right Certificate may exercise
the Rights evidenced thereby
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in whole or in part at any time after the close of business on 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 principal office of the Rights Agent in Chicago,
Illinois, or at such other office of the Rights Agent as may be published
from time to time by the Company, together with payment of the Purchase
Price for the appropriate number of shares of Common Stock as to which the
Rights are exercised, at or prior to the close of business on the earlier
of (i) February 28, 2006 (the "Final Expiration Date"), or (ii) the date on
which the Rights are redeemed as provided in Section 23 (such earlier date
being herein referred to as the "Expiration Date"); provided, however, that
if the number of Rights exercised would entitle the holder thereof to
receive any fraction of a share of Common Stock (subject to adjustment as
provided in Section 11 or 13 hereof), the Company may at its option, in
lieu of issuing fractional shares therefor, pay an amount in cash as
determined in accordance with Section 14(b) hereof.
(b) Subject to adjustment as provided herein, the Purchase
Price for each share of Common Stock pursuant to the exercise of a Right
shall be $______. The Purchase Price in effect from time to time shall be
subject to adjustment from time to time as provided in Section 11 or 13
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hereof and shall be payable in lawful money of the United States of America
in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate, with the form of
election to purchase duly executed, accompanied by payment of the Purchase
Price for the shares to be purchased and an amount equal to any applicable
transfer tax required to be paid by the record holder of the Rights
pursuant hereto in cash, or by check or money order payable to the order of
the Company, the Rights Agent shall thereupon promptly (i) requisition from
any transfer agent of the Common Stock of the Company certificates for the
number of shares of Common Stock to be purchased and the Company hereby
irrevocably authorizes its transfer agent to comply with all such requests,
(ii) when appropriate, requisition from the Company the amount of cash to
be paid in lieu of issuance of fractional shares in accordance with Section
14 hereof, (iii) promptly after receipt of such certificates cause the same
to be delivered to or upon the order of the record holder of such Right
Certificate, recorded in such name or names as may be designated by such
holder and (iv) when appropriate, after receipt promptly deliver such cash
to or upon the order of the record holder of such Right Certificate.
(d) In case the record holder of any Right Certificate shall
exercise less than all the Rights
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evidenced thereby, a new Right Certificate evidencing Rights equivalent to
the Rights remaining unexercised shall be issued by the Rights Agent to the
record holder of such Right Certificate or to his duly authorized assigns,
subject to the provisions of Section 14 hereof.
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. The Company covenants and agrees that at
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all times from and after the close of business on the Distribution Date to
and until the close of business on the earlier of the Expiration Date or
the Final Expiration Date it will cause to be reserved and kept available
out of its authorized and unissued shares of Common Stock or its authorized
and issued shares of Common Stock held in its treasury, the number of
shares of Common Stock that will be sufficient to permit the exercise in
full of all outstanding Rights or take the steps set forth in
Section 13(d).
During the period when shares of Common Stock are required to
be reserved as aforesaid and so long as the Common Stock issuable upon the
exercise of Rights may be listed on any national securities exchange, the
Company shall use its best efforts to cause all shares reserved for such
issuance to be listed on such exchange upon official notice of issuance
upon such exercise.
The Company covenants and agrees that it will take all such
action as may be necessary to insure that all shares of Common Stock
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
shares.
The Company further covenants and agrees that it will pay when
due and payable any and all federal and state
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transfer taxes and charges which may be payable in respect of the issuance
or delivery of the Right Certificates or of any shares of Common Stock upon
the exercise of Rights. The Company shall not, however, be required to pay
any transfer tax which may be payable in respect of any transfer involved
in the transfer or delivery of Right Certificates or the issuance or
delivery of certificates for Common Stock in a name other than that of the
record holder of the Right Certificate evidencing Rights surrendered for
exercise or to issue or deliver any certificates for shares of Common Stock
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 Common Stock is issued upon the exercise
of Rights shall for all purposes be deemed to have become the holder of
record of the Common Stock 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; provided, however, that if the date of
such surrender and payment is a date upon which the Common Stock
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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
transfer books of the Company are open.
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) In the event the Company shall at any time after the date
of this Rights Agreement declare a dividend on the Common Stock payable in
shares of Common Stock, subdivide the outstanding Common Stock, combine the
outstanding Common Stock into a smaller number of shares or issue any
shares of its capital stock in a reclassification of the Common Stock
(including any such reclassification in connection with a consolidation or
merger in which the Company is the continuing corporation), except as
otherwise provided in Section 13, 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 capital stock issuable on such date, shall be proportionately
adjusted so that the record holder of any
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Right exercised after such time shall be entitled to receive the aggregate
number and kind of shares of capital stock which, if such Right had been
exercised immediately prior to such date and at a time when the Common
Stock transfer books of the Company were open, he would have owned upon
such exercise and been entitled by virtue of such dividend, subdivision,
combination or reclassification.
(b) In case the Company shall fix a record date for the
issuance of rights or warrants to all record holders of Common Stock
entitling them (for a period expiring within 45 calendar days after such
record date) to subscribe for or purchase Common Stock (or securities
convertible into Common Stock) at a price per share of Common Stock (or
having a conversion price per share of Common Stock, if a security
convertible into Common Stock) less than the current market price per share
of Common Stock (as defined in Section 11(d)) 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 Common Stock outstanding on such record date plus the number of
shares of Common Stock which the aggregate offering price of the total
number of shares of Common Stock so to be offered (or the aggregate initial
conversion price of the convertible securities so to
22
be offered) would purchase at such current market price and of which the
denominator shall be the number of shares of Common Stock outstanding on
such record date plus the number of additional shares of Common Stock to be
offered for subscription or purchase (or into which the convertible
securities so to be offered are initially convertible). In case such
subscription price may be paid in a consideration part or all of which
shall be in a form other than cash, the value of such consideration shall
be as determined in good faith by the Board of Directors of the Company,
whose determination shall be described in a statement filed with the Rights
Agent. Shares of Common Stock owned by or held for the account of the
Company or any Subsidiary of the Company shall not be deemed outstanding
for the purpose of any such computation. Such adjustment shall be made
successively whenever such a record date is fixed; and in the event that
such rights or warrants are not so issued, the Purchase Price shall be
adjusted to be the Purchase Price which would then be in effect if such
record date had not been fixed.
(c) In case the Company shall fix a record date for the making
of a distribution to all holders of Common Stock (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing corporation) of evidences of indebtedness or
23
assets (other than a regular periodic cash dividend at a rate not in excess
of 200% of the rate of the last cash dividend theretofore paid or a
dividend payable in 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 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 Common Stock and of which the
denominator shall be such current market price per share of Common Stock.
Such adjustments shall be made successively whenever such a record date is
fixed; and in the event that such distribution is not so made, the Purchase
Price shall 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, the "current
market price" per share of Common Stock on any date shall be deemed to be
the average of the daily closing
24
prices per share of such Common Stock for the 30 consecutive Trading Days
(as such term is hereinafter defined) immediately prior to such date;
provided, however, that in the event that the current market price per
share of Common Stock is determined during a period following the
announcement by the issuer of such Common Stock of a dividend or
distribution on such Common Stock payable in shares of such Common Stock or
securities convertible into shares of such Common Stock, and prior to the
expiration of 30 Trading Days after the ex-dividend date for such dividend
or distribution, then, and in each such case, the current market price
shall be appropriately adjusted to reflect the current market price per
Common Stock equivalent. The closing price for each day shall be the last
sale price, regular way, or, in case no such sale takes place on such day,
the average of the closing bid and asked prices, regular way, in either
case as reported in the principal consolidated transaction reporting system
with respect to securities listed or admitted to trading on the New York
Stock Exchange or, if the shares of Common Stock are not listed or admitted
to trading on the New York Stock Exchange, as reported in the principal
consolidated transaction reporting system with respect to securities listed
on the principal national securities exchange on which the shares of Common
Stock are listed or admitted to
25
trading or, if the shares of Common Stock are not listed or admitted to
trading on any national securities exchange, 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 Common Stock are not quoted by any such organization, the average
of the closing bid and asked prices as furnished by a professional market
maker making a market in the Common Stock selected by the Board of
Directors of the Company. If on any such date no market maker is making a
market in the Common Stock, the fair value of such shares on such date as
determined in good faith by the Board of Directors of the issuer of such
Common Stock shall be used. The term "Trading Day" shall mean a day on
which the principal national securities exchange on which the shares of
Common Stock are listed or admitted to trading is open for the transaction
of business or, if the shares of 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
26
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.
(e) 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 as the case may be. Notwithstanding the first
sentence of this Section 11(e), any adjustment required by this Section 11
shall be made no later than the earlier of (i) three years from the date of
the transaction which mandates such adjustment or (ii) the date of the
expiration of the right to exercise any Rights.
(f) In the event that at any time, as a result of an
adjustment made pursuant to Section 11(a), the holder of any Right shall be
entitled to receive upon exercise of such Right any shares of capital stock
of the Company other than shares of Common Stock, thereafter the number of
such other shares so receivable upon exercise of any Right shall be subject
to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions
27
with respect to the shares contained in Section 11(a) through (c),
inclusive, and the provisions of Sections 7, 9, 10 and 13 with respect to
the shares of Common Stock shall apply on like terms to any such other
shares.
(g) All Rights originally issued by the Company subsequent to
any adjustment made to the Purchase Price hereunder shall evidence the
right to purchase, at the adjusted Purchase Price, the number of shares of
Common Stock purchasable from time to time hereunder upon exercise of the
Rights, all subject to further adjustments 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.
28
(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 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 Common Stock for which such Right was exercisable
immediately prior to such adjustment. Each Right held of record prior to
such adjustment of the number of Rights shall become that number of Rights
(calculated to the nearest ten-thousandth) obtained by dividing the
Purchase Price in effect immediately prior to adjustment of the Purchase
Price by the Purchase Price in effect immediately after adjustment of the
Purchase Price. The Company shall make a public announcement of its
election to adjust the number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the adjustment to be
made. This record date may be the date on which the Purchase Price is
adjusted or any day thereafter, but, if the Right Certificates have been
issued, shall be at least 10 days later than the date of the public
announcement. If Right Certificates have been issued, upon each adjustment
of the number of Rights pursuant to this Section 11(i) the Company shall,
as promptly as practicable, cause to be distributed to holders of record of
Right Certificates
29
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 Common Stock issuable upon the exercise of
the Rights, the Right Certificates theretofore and thereafter issued may
continue to express the Purchase Price and the number of shares which were
expressed in the initial Right Certificates issued hereunder.
(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 Common Stock issuable upon
30
exercise of the Rights, the Company shall take any corporate action which
may, in the opinion of its counsel, be necessary in order that the Company
may validly and legally issue fully paid and nonassessable shares of such
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 issuing to the record holder of any Right exercised after
such record date the share of Common Stock and other capital stock or
securities of the Company, if any, issuable upon such exercise over and
above the shares of Common Stock and other capital stock or securities of
the Company, if any, issuable upon such exercise on the basis of the
Purchase Price in effect prior to such adjustment; provided, however, that
the Company shall deliver to such holder a due ▇▇▇▇ or other appropriate
instrument evidencing such holder's right to receive such additional shares
upon the occurrence of the event requiring such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such reductions in
the Purchase Price, in addition to those adjustments expressly required by
this Section 11, as and to the extent that it in its sole discretion shall
determine to
31
be advisable in order that any consolidation or subdivision of the Common
Stock, issuance wholly for cash of any Common Stock at less than the
current market price, issuance wholly for cash of Common Stock or
securities which by their terms are convertible into or exchangeable for
Common Stock, stock dividends, or issuance of rights, options or warrants
referred to hereinabove in this Section 11, hereafter made by the Company
to the record holders of its Common Stock, shall not be taxable to such
stockholders.
Section 12. Certificate of Adjusted Purchase Price or Number
of Shares. Whenever an adjustment is made as provided in Section 11 or 13,
the Company shall (a) promptly prepare a certificate setting forth such
adjustment, and a brief statement of the facts accounting for such
adjustment, (b) promptly file with the Rights Agent and with each transfer
agent for the Common Stock a copy of such certificate and (c) mail a brief
summary thereof to each holder of a Right Certificate in accordance with
Section 25.
Section 13. Adjustments to Rights in Event of Certain
Transactions. (a) In the event that prior to the Expiration Date or the
Final Expiration Date a Flip-in Date shall occur, the Company shall take
such action as shall be necessary to ensure and provide that, except as
provided below, each Right shall constitute the right to purchase
32
from the Company, upon exercise thereof in accordance with the terms hereof
(but subject to Section 26(b) hereof), that number of shares of Common
Stock having an aggregate current market price on the Stock Acquisition
Date equal to twice the Purchase Price for an amount in cash equal to the
Purchase Price (such right to be appropriately adjusted in order to protect
the interests of the holders of Rights generally in the event that on or
after such Stock Acquisition Date an event of a type analogous to any of
the events described in Section 11 shall have occurred with respect to the
Common Stock).
(b) Notwithstanding the foregoing, any Rights that are or were
Beneficially Owned on or after the Stock Acquisition Date by an Acquiring
Person or an Affiliate or Associate thereof or by any transferee, direct or
indirect, of any of the foregoing shall become void and any holder of such
Rights (including transferees) shall thereafter have no right to exercise
or transfer such Rights under any provision of the Rights Agreement. If
any Rights Certificate is presented for assignment or exercise and the
Person presenting the same will not complete the certification set forth at
the end of the form of assignment or notice of election to exercise and
provide such additional evidence of the identity of the Beneficial Owner
and its Affiliates and Associates (or former Beneficial
33
Owners and their Affiliates and Associates) as the Company shall reasonably
request, then the Company shall be entitled to conclusively deem the
Beneficial Owner thereof to be an Acquiring Person or an Affiliate or
Associate thereof or a transferee of any of the foregoing and accordingly
will deem the Rights evidenced thereby to be void and not transferable or
exercisable.
(c) The Board of Directors of the Company may, at its option,
at any time after a Flip-in Date and prior to the time that an Acquiring
Person becomes the Beneficial Owner of more than 50% of the outstanding
shares of Common Stock, elect to exchange all (but not less than all) the
then outstanding Rights (which shall not include Rights that have become
void pursuant to the provisions of subsection (b) of this Section 13) for
shares of Common Stock at an exchange ratio of one share of Common Stock
per Right, appropriately adjusted in order to protect the interests of
holders of Rights generally in the event that after the Distribution Date
an event of a type analogous to any of the events described in Section 11
shall have occurred with respect to the Common Stock (such exchange ratio,
as adjusted from time to time, being hereinafter referred to as the
"Exchange Ratio").
Immediately upon the action of the Board of Directors of the
Company electing to exchange the Rights and
34
without any further action and without any notice, the right to exercise
the Rights will terminate and each Right will thereafter represent only the
right to receive a number of shares of Common Stock equal to the Exchange
Ratio. Promptly after the action of the Board of Directors electing to
exchange the Rights, the Company shall give notice thereof (specifying the
steps to be taken to receive the shares of Common Stock in exchange for
Rights) to the Rights Agents and the holders of the then outstanding Rights
by mailing such notice in accordance with Section 25.
(d) In the event that there shall not be sufficient unreserved
treasury shares or authorized but unissued shares of Common Stock of the
Company to permit the exercise or exchange in full of the Rights in
accordance with Section 13(a) or (c), the Company may cause sufficient
additional shares to be authorized (and shall call a stockholders' meeting
to effect the same) or, if the Company is unable to cause such additional
shares to be authorized (whether because the same is not approved at the
stockholders' meeting referred to above or for any other reason) or the
Company chooses not to do so, the Company shall take such action as shall
be necessary to ensure and provide, to the extent permitted by applicable
law and any agreements or instruments in effect on the Stock Acquisition
Date to which it is a party, that each Right shall
35
thereafter constitute the right to receive, (i) at the Company's option,
either (x) in return for the Purchase Price, debt or equity securities or
other assets (or a combination thereof) having a fair value equal to twice
the Purchase Price, or (y) without charge (except as otherwise required by
applicable law), debt or equity securities or other assets (or a
combination thereof) having a fair value equal to the Purchase Price, or
(ii) if the Board of Directors of the Company elects to exchange the Rights
in accordance with Section 13(c), debt or equity securities or other assets
(or a combination thereof) having a fair value equal to the product of the
current market price of a share of Common Stock on the Stock Acquisition
Date times the Exchange Ratio in effect on the Flip-in Date, where in any
case set forth in (i) or (ii) above the fair value of such debt or equity
securities shall be as determined in good faith by the Board of Directors
of the Company, after consultation with a nationally recognized investment
banking firm.
(e) In the event that prior to the Expiration Date or the
Final Expiration Date, a Flip-over Transaction or Event shall occur, each
Right shall thereafter constitute the right to purchase from the Person
engaging in such Flip-over Transaction or Event (the "Flip-over Entity"),
upon exercise thereof in accordance with the terms hereof,
36
that number of shares of Flip-over Stock of such Flip-over Entity having an
aggregate current market price on the date of consummation or occurrence of
such Flip-over Transaction or Event equal to twice the Purchase Price for
an amount in cash equal to the Purchase Price (such right to be
appropriately adjusted in order to protect the interests of the holders of
Rights generally in the event that an event of a type analogous to any of
the events described in Section 11 shall have occurred with respect to the
Flip-over Stock). The provisions of this Section 13(e) and Section 13(f)
shall apply to successive Flip-over Transactions or Events.
(f) Unless the Rights will be redeemed pursuant to Section 23
in connection therewith, the Company shall not enter into any agreement
with respect to, or consummate or permit to occur any Flip-over Transaction
or Event unless (i) the Company shall have entered into a supplemental
agreement with the Flip-over Entity, for the benefit of the holders of the
Rights; providing that, upon consummation or occurrence of the Flip-over
Transaction or Event, the issuer of the shares of Flip-over Stock shall
thereafter be liable for, and shall assume, by virtue of such Flip-over
Transaction or Event and such supplemental agreement, all the obligations
and duties of the Company pursuant to this Rights Agreement and (ii) there
are not in existence at the
37
time of such Flip-over Transaction or Event any rights, warrants or
securities outstanding or any other arrangements, agreements or instruments
which would eliminate or otherwise diminish in any respect the benefits
intended to be afforded by the Rights Agreement to the Holders of Rights
upon consummation of such transaction.
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, there shall be paid to the record 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
38
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
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 Common Stock 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 upon exercise of the Rights or to distribute certificates which
evidence fractional shares. In lieu of fractional shares, the Company may
pay to the record holders of Right Certificates at the time such Right
Certificates are exercised as herein provided an amount in cash equal to
the same fraction of the current market value of a share of Common Stock.
39
(c) The record holder of a Right by the acceptance of the
Rights expressly waives his right to receive any fractional Rights or any
fractional share upon exercise of Rights.
Section 15. Rights of Action. All rights of action in respect
of this Rights Agreement are vested in the respective record holders of the
Right Certificates (and prior to and on the Distribution Date, the record
holders of the Common Stock); and any record holder of any Right
Certificate (or, prior to and on the Distribution Date, of the Common
Stock), without the consent of the Rights Agent or of the record holder of
any other Right Certificate (or, prior to and on 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 Rights Agreement. Without limiting the
foregoing or any remedies available to the record holders of Rights, it is
specifically acknowledged that the record holders of Rights would not have
an adequate remedy at law for any breach of this Rights Agreement and will
be entitled to specific performance of the obligations under, and
injunctive relief against actual or threatened violations
40
of, the obligations of any Person subject to this Rights Agreement.
Section 16. Agreement of Right Holders. Every record 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 and on the Distribution Date, the Rights will be
transferable only in connection with the transfer of Common Stock;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered
at the principal office of the Rights Agent, duly endorsed or accompanied
by a proper instrument of transfer; and
(c) the Company and the Rights Agent may deem and treat the
person in whose name the Right Certificate (or, prior to and on the
Distribution Date, the associated Common Stock certificate) is recorded as
the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the Right
Certificates or the associated Common Stock certificate made by anyone
other than the Company or the Rights Agent) for all purposes whatsoever,
and neither the Company nor the Rights Agent shall be affected by any
notice to the contrary.
41
Section 17. Right Certificate Holder Not Deemed a Stockholder.
No record holder, as such, of any Right Certificate shall be entitled to
vote, receive dividends or be deemed for any purpose the record holder of
Common Stock or any other securities of the Company which may at any time
be issuable on the exercise of the Rights represented thereby, nor shall
anything contained herein or in any Right Certificate be construed to
confer upon the record holder of any Right Certificate, as such, any of the
rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give or withhold consent to any corporate action, or
to receive notice of meetings or other actions affecting stockholders
(except as provided in Section 24), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced by such Right
Certificate shall have been exercised in accordance with the provisions
hereof.
Section 18. Concerning the Rights Agent. The Company agrees
to pay to the Rights Agent reasonable compensation for all services
rendered by it hereunder and, from time to time, on demand of the Rights
Agent, its reasonable expenses and counsel fees and other disbursements
incurred in the administration and execution of this Rights Agreement and
the exercise and performance of its duties
42
hereunder. The Company also agrees to indemnify the Rights Agent for, and
to hold it harmless against, any loss, liability, or expense, incurred
without negligence, bad faith or willful misconduct on the part of the
Rights Agent, for anything done or omitted by the Rights Agent in
connection with the acceptance and administration of this Rights Agreement,
including the costs and expenses of defending against any claim of
liability.
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 Rights Agreement in reliance
upon any Right Certificate or certificate for Common Stock or for other
securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document believed by it to be
genuine and to be signed, executed and, where necessary, verified or
acknowledged, by the proper person or persons.
Section 19. Merger or Consolidation or Change of Name of
Rights Agent. 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
43
corporation succeeding to the corporate trust business of the Rights Agent
or any successor Rights Agent, shall be the successor to the Rights Agent
under this Rights Agreement without the execution or filing of any paper or
any further act on the part of any of the parties hereto, provided that
such corporation would be eligible for appointment as a successor Rights
Agent under the provisions of Section 21. In case at the time such
successor Rights Agent shall succeed to the agency created by this Rights
Agreement, any of the Right Certificates shall have been countersigned but
not delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such Right
Certificates so countersigned; and in case at that time any of the Right
Certificates shall not have been countersigned, any successor Rights Agent
may countersign such Right Certificates either in the name of the
predecessor Rights Agent or in the name of the successor Rights Agent; and
in all such cases such Right Certificates shall have the full force
provided in the Right Certificates and in this Rights Agreement.
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
44
countersigned; and in case at that time any of the Right Certificates shall
not have been countersigned, the Rights Agent may countersign such Right
Certificates either in its prior name or in its changed name; and in all
such cases such Right Certificates shall have the full force provided in
the Right Certificates and in this Rights Agreement.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this Rights Agreement upon
the following terms and conditions, by all of which the Company and the
holders of Right Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may
be legal counsel for the Company), and the opinion of such counsel shall be
full and complete authorization and protection to the Rights Agent as to
any action taken or omitted by it in good faith and in accordance with such
opinion.
(b) Whenever in the performance of its duties under this
Rights Agreement the Rights Agent shall deem it necessary or desirable that
any fact or matter be proved or established by the Company prior to taking
or suffering any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically prescribed) may be
deemed to be conclusively proved and established by a certificate signed by
the Chairman of the Board, the
45
President or any Vice President and by the Treasurer or any Assistant
Treasurer or the Secretary or any Assistant Secretary of the Company and
delivered to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken or suffered in good
faith by it under the provisions of this Rights Agreement in reliance upon
such certificate.
(c) The Rights Agent shall be liable hereunder only for its
own negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of
any of the statements of fact or recitals contained in this Rights
Agreement or in the Right Certificates (except its countersignature
thereof) or be required to verify the same, but all such statements and
recitals are and shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Rights Agreement or the execution and
delivery hereof (except the due execution hereof by the Rights Agent) or in
respect of the validity or execution of any Right Certificate (except its
countersignature thereof); nor shall it be responsible for any breach by
the Company of any covenant or condition contained in this Rights Agreement
or in any Right
46
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 Common Stock to be issued pursuant to this Rights Agreement or
any Right Certificate or as to whether any shares of 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 Rights Agreement.
(g) The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties hereunder
from the Chairman of the Board, the President or any Vice President or the
Secretary or any Assistant Secretary or the Treasurer or any Assistant
47
Treasurer of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable for
any action taken or suffered to be taken by it in good faith in accordance
with instructions of any such officer.
(h) Nothing herein shall preclude the Rights Agent or any
shareholder, director, officer or employee of the Rights Agent from buying,
selling or dealing in any of the Rights or other securities of the Company
or becoming pecuniarily interested in any transaction in which the Company
may be interested, or contracting with or lending money to the Company or
otherwise acting as fully and freely as though it were not Rights Agent
under this Rights Agreement. In addition, nothing herein shall preclude
the Rights Agent from acting in any other capacity for the Company or for
any other legal entity.
(i) The Rights Agent may execute and exercise any of the
rights or powers hereby vested in it or perform any duty hereunder either
itself or by or through its attorneys or agents, and the Rights Agent shall
not be answerable or accountable for any act, default, neglect or
misconduct of any such attorneys or agents or for any loss to the Company
resulting from any such act, default, neglect or misconduct, provided
reasonable care was exercised in the selection and continued employment
thereof.
48
Section 21. Change of Rights Agent. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties under
this Rights Agreement upon 30 days' notice in writing mailed to the Company
and to each transfer agent of the Common Stock by registered or certified
mail, and to the holders of the Right Certificates by first-class mail.
The Company may remove the Rights Agent or any successor Rights Agent upon
30 days' notice in writing, mailed to the Rights Agent or successor Rights
Agent, as the case may be, and to each transfer agent of the Common Stock
by registered or certified mail, and to the record 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 30 days after such removal or after it
has been notified in writing of such resignation or incapacity by the
resigning or incapacitated Rights Agent or by the record holder of a Right
Certificate (who shall, with such notice, submit his Right Certificate for
inspection by the Company), then the record 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
49
corporation organized and doing business under the laws of the United
States or of the State of Illinois, in good standing, having its principal
office in the State of Illinois, which is authorized under such laws to
exercise corporate trust powers and is subject to supervision or
examination by federal or state authority and which has at the time of its
appointment as Rights Agent a combined capital and surplus of at least
$50,000,000. 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 record 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.
50
Section 22. Issuance of New Right Certificates.
Notwithstanding any of the provisions of this Rights Agreement or of the
Rights to the contrary, the Company may, at its option, issue new Right
Certificates evidencing Rights in such form as may be approved by its Board
of Directors to reflect any adjustment or change in the Purchase Price and
the number or kind or class of shares of stock or other securities or
property purchasable under the Right Certificates made in accordance with
the provisions of this Rights Agreement.
Section 23. Redemption. The Company may, at its option, at
any time prior to the earlier of (i) the Stock Acquisition Date or
(ii) 5:00 P.M., St. Louis time, on the Final Expiration Date, elect to
redeem all but not less than all the then outstanding Rights at a
redemption price of $.05 per Right (such redemption price being hereinafter
referred to as the "Redemption Price"). Immediately upon the action of the
Board of Directors of the Company electing to redeem the Rights, the
Company shall make a public announcement thereof, and from the time of such
announcement, without any further action and without any notice, the right
to exercise the Rights will terminate and the only right thereafter of the
record holders of Rights shall be to receive the Redemption Price, but
without any interest thereon. Within 10 days after the action of the
51
Board of Directors ordering the redemption of the Rights, the Company shall
give notice of such redemption to the record holders of the then
outstanding Rights by mailing such notice to all such holders at their last
addresses as they appear upon the registry books of the Rights Agent or,
prior to the close of business on the Distribution Date, on the registry
books of the principal transfer agent for the Common Stock. Any notice
which is mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice. Each such notice of
redemption will state the method by which the payment of the Redemption
Price will be made.
Section 24. Notice of Proposed Actions. In case the Company
shall propose (a) to pay any dividend payable in stock of any class to the
record holders of its Common Stock or to make any other distribution to the
record holders of its Common Stock (other than a regular periodic cash
dividend at a rate not in excess of 200% of the rate of the last cash
dividend theretofore paid), or (b) to offer to the record holders of its
Common Stock rights or warrants to subscribe for or to purchase any
additional shares of Common Stock or shares of stock of any class or any
other securities, rights or options, or (c) to effect any reclassification
of its Common Stock (other than a reclassification involving only the
subdivision of
52
outstanding shares of Common Stock), or (d) to effect any consolidation or
merger into or with, 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 (including those occurring prior to the Company so
proposing), 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 or any Subsidiary of the Company), or (e) to effect
the liquidation, dissolution or winding up of the Company, then, in each
such case, the Company shall give to each record holder of a Right, in
accordance with Section 25, a notice of such proposed action, which shall
specify the record date for the purposes of such stock dividend,
distribution of rights or warrants, or the date on which such
reclassification, consolidation, merger, sale, transfer, liquidation,
dissolution, or winding up is to take place and the date of participation
therein by the record holders of Common Stock, if any such date is to be
fixed, and such notice shall be so given in the case of any action covered
by clause (a) or (b) above at least twenty days prior to the record date
for determining record holders of the Common Stock for purposes of such
action, and in the case of any such other action, at least twenty days
prior to the date of the taking of such proposed action or the date
53
of participation therein by the record holders of Common Stock, whichever
shall be the earlier. The failure to give notice required by this Section
24 or any defect therein shall not affect the legality or validity of the
action taken by the Company or the vote upon any such action.
Section 25. Notices. Notices or demands authorized by this
Rights Agreement to be given or made by the Rights Agent or by the record
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:
Mallinckrodt Group Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇. ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Corporate Secretary
Subject to the provisions of Section 21, any notice or demand authorized by
this Rights Agreement to be given or made by the Company or by the record
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:
The First National Bank
of Chicago
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
54
Attention: Shareholder Services Department
Notices or demands authorized by this Rights Agreement to be given or made
by the Company or the Rights Agent to the record holder of any Right
Certificate shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed to such record holder at the address of
such holder as shown on the registry books of the Company.
Section 26. Powers of the Board of Directors. (a) The Board
of Directors of the Company shall have the power to interpret all of the
terms and provisions of this Rights Agreement, including, without
limitation, and on the basis of information known to the Board after
reasonable inquiry (A) whether a Person is an Acquiring Person, (B) the
number of outstanding securities of the Company beneficially owned by any
Person, or (C) whether a Person is an Affiliate or Associate of another
Person.
(b) To the extent that the Company determines in good faith
that some action need be taken pursuant to Section 13(d) or to comply with
federal or state securities laws, the Company may suspend the
exercisability of the Rights for a period of up to 90 days following the
date of the occurrence of the Distribution Date or the Flip-in Date in
order to take such action or comply with such laws. In the event of any
such suspension, the Company shall issue as promptly as practicable a
public announcement stating that
55
the exercisability of the Rights has been temporarily suspended.
Section 27. Supplements and Amendments. The Company and the
Rights Agent may from time to time supplement or amend this Rights
Agreement without the approval of any holders of Right Certificates in
order to cure any ambiguity, to correct or supplement any provision
contained herein, or in any supplement or amendment hereto, which may be
defective or inconsistent with any other provisions herein or in any
supplement or amendment hereto, or to make such other provisions in regard
to matters or questions arising hereunder which shall not adversely affect
the interests of the holders of Right Certificates. The Rights Agent is
hereby authorized to join with the Company in the execution of any such
supplement or amendment, to make any further appropriate agreements or
stipulations which may be contained therein, but the Rights Agent shall not
be obligated to, but may in its discretion, enter into any such supplement
or amendment which adversely affects the Rights Agent's own rights, duties
or immunities under this Rights Agreement or otherwise.
Section 28. Successors. All the covenants and provisions of
this Rights Agreement by or for the benefit of the Company or the Rights
Agent shall bind and inure to the
56
benefit of their respective successors and assigns hereunder.
Section 29. Benefits of this Rights Agreement. Nothing in
this Rights Agreement shall be construed to give to any person or
corporation other than the Company, the Rights Agent and the record holders
of the Right Certificates any legal or equitable right, remedy or claim
under this Rights Agreement; but this Rights Agreement shall be for the
sole and exclusive benefit of the Company, the Rights Agent and the record
holders of the Right Certificates.
Section 30. Governing Law. This Rights Agreement and each
Right Certificate issued hereunder shall be deemed to be a contract made
under the laws of the State of 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 31. Severability. In the event any term, provision,
covenant or restriction of this Rights Agreement shall, for any reason, be
held by a court of competent jurisdiction to be invalid, illegal, void or
unenforceable, such invalidity, illegality or unenforceability shall not
affect any other term or provision of this Rights Agreement and the
remainder of the terms, provisions, covenants and
57
restrictions of this Rights Agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated. It is hereby
stipulated and declared to be the intention of the parties hereto that they
would have executed the remaining terms, provisions, covenants and
restrictions of this Rights Agreement without including any of such
provisions that may be hereafter declared invalid, illegal, void or
unenforceable.
Section 32. Counterparts. This Rights Agreement may be
executed in any number of counterparts and each of such counterparts shall
for all purposes be deemed to be an original, and all such counterparts
shall together constitute but one and the same instrument.
Section 33. Descriptive Headings. Descriptive headings of the
several Sections of this Rights Agreement are inserted for convenience only
and shall not control or affect the meaning or construction of any of the
provisions hereof.
58
IN WITNESS WHEREOF, the parties hereto have caused this Rights
Agreement to be duly executed and their respective corporate seals to be
hereunto affixed and attested, all as of February 19, 1996.
Attest: MALLINCKRODT GROUP INC.
By /s/ ▇▇▇▇▇▇ ▇. Wuestrer By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. Wuestrer Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Assistant Secretary Title: Secretary & General Counsel
Attest: THE FIRST NATIONAL BANK
OF CHICAGO
By /s/ ▇▇▇▇▇▇▇ ▇. Phalew By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇ ▇. Phalew Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President Title: Assistant Vice President
1
Exhibit A
[Form of Right Certificate]*
Certificate No. W- _______ Rights
NOT EXERCISABLE AFTER FEBRUARY 28, 2006 OR EARLIER IF NOTICE OF
REDEMPTION IS GIVEN. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.05
PER RIGHT OR MANDATORY EXCHANGE, AT THE OPTION OF THE COMPANY, ON THE
TERMS SET FORTH IN THE RIGHTS AGREEMENT. RIGHTS BENEFICIALLY OWNED
BY ACQUIRING PERSONS OR ASSOCIATES OR AFFILIATES THEREOF (AS SUCH
TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR TRANSFEREES OF ANY OF
THE FOREGOING WILL BE VOID.
Right Certificate
MALLINCKRODT GROUP INC.
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 Amended and Restated Rights Agreement dated as of February 19, 1996
(the "Rights Agreement") between Mallinckrodt Group Inc., a New York
corporation (the "Company"), and The First National Bank of Chicago, a
national banking association (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. St. Louis time on February 28,
2006 at the principal office of the Rights Agent, or its successors as
Rights Agent, in Chicago, Illinois, one fully paid
* Deliverable in this form only after Distribution Date.
2
nonassessable share of the Common Stock, $1 par value per share ("Common
Stock"), of the Company, at a purchase price of $_______* per share (the
"Purchase Price") upon presentation and surrender of this Right Certificate
with the form of Election to Purchase duly executed. The number of Rights
evidenced by this Right Certificate (and the number of shares which may be
purchased upon exercise of each Right) set forth above, and the Purchase
Price per share set forth above, are the number and Purchase Price as of
_____________, 19___**, based on the shares of Common Stock of the
Company as constituted at such date.
As provided in the Rights Agreement, the Purchase Price and the
number of shares of Common Stock which may be purchased upon the exercise
of each of the Rights evidenced by this Right Certificate are subject to
modification and adjustment upon the happening of certain events. In
addition, in certain circumstances, this Right will entitle its record
holder to purchase capital stock of an entity other than the Company or
shares of capital stock of the Company other than Common Stock, all as
provided in the Rights Agreement.
This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement,
* Insert the Purchase Price as of the Distribution Date.
** Insert the Distribution Date.
3
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 record holders of the Right Certificates. Copies of the
Rights Agreement are on file at the above-mentioned office of the Rights
Agent.
This Right Certificate, with or without other Right
Certificates, upon surrender at the principal office of the Rights Agent,
may be exchanged for another Right Certificate or Right Certificates of
like tenor and date evidencing Rights entitling the record holder to
purchase a like aggregate number of shares of Common Stock as the Rights
evidenced by the Right Certificate or Right Certificates surrendered shall
have entitled such record holder to purchase. If this Right Certificate
shall be exercised in part, the record holder shall be entitled to receive,
upon surrender hereof, another Right Certificate or Right Certificates for
the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights
evidenced by this Certificate may be (a) redeemed by the Company at its
option at a redemption price of $.05 per Right or (b) exchanged by the
Company under certain circumstances at its option for one share of Common
Stock
4
per Right (or, in certain cases, other securities or assets of the
Company), subject in each case to adjustment in certain events as provided
in the Rights Agreement.
If upon the exercise of any Rights evidenced hereby the number
of Rights exercised would entitle the holder thereof to receive any
fraction of a share of Common Stock, the Company may at its option, in lieu
of issuing fractional shares therefor, pay an amount in cash to such
holder, as provided in the Rights Agreement.
No record holder of this Right Certificate shall be entitled to
vote or receive dividends or be deemed for any purpose the holder of Common
Stock or of any other securities of the Company which may at any time be
issuable on the exercise thereof, nor shall anything contained in the
Rights Agreement or herein be construed to confer upon the record holder
hereof, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions
affecting stockholders (except as provided in the Rights Agreement), or to
receive dividends or subscription rights, or otherwise, until the Rights
evidenced by this Right Certificate shall have been exercised as provided
in the Rights Agreement.
5
This Right Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights Agent.
6
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal. Dated as of February 19, 1996.
Attest: MALLINCKRODT GROUP INC.
_________________________ By____________________________
Secretary Name:
Title:
Countersigned:
THE FIRST NATIONAL BANK
OF CHICAGO
By_______________________
Name:
Title:
7
[Form of Reverse Side of Right Certificate]
FORM OF ASSIGNMENT
(To be executed by the 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 Rights Certificate on the books of the
within-named Company, with full power of substitution.
Dated: _________________, 19___
_________________________
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Assignment 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.
8
------------------------------------------------------------
(To be completed if true)
The undersigned hereby represents, for the benefit of all holders of Rights
and shares of Common Stock, that the Rights evidenced by this Rights
Certificate are not, and, to the knowledge of the undersigned, have never
been, Beneficially Owned by an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement).
_________________________
Signature
------------------------------------------------------------
NOTICE
In the event the certification set forth above is not completed
in connection with a purported assignment, the Company will deem the
Beneficial Owner of the Rights evidenced by the enclosed Rights Certificate
to be an Acquiring Person or an Affiliate or Associate thereof (as defined
in the Rights Agreement) or a transferee of any of the foregoing and
accordingly will deem the Rights evidenced by such Rights Certificate to be
void and not transferable or exercisable.
9
[To be attached to each Rights Certificate]
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise the Rights Certificate.)
TO: MALLINCKRODT GROUP INC.
The undersigned hereby irrevocably elects to exercise
_________________ whole Rights represented by the attached Rights
Certificate to purchase the shares of Common Stock issuable upon the
exercise of such Rights and requests that certificates for such shares be
issued in the name of:
________________________________________
Address:
________________________________________
________________________________________
Social Security or Other Taxpayer
Identification Number:
________________________________________
If such number of Rights shall not be all the Rights evidenced by this
Rights Certificate, a new Rights Certificate for the balance of such Rights
shall be registered in the name of and delivered to:
________________________________________
Address:
________________________________________
________________________________________
Social Security or Other Taxpayer
Identification Number:
________________________________________
Dated: ______________, 19___
Signature Guaranteed: _________________________
Signature
(Signature must corres-
pond to name as written
upon the face of this Rights
Certificate in every particular,
without alteration or enlargement
or any change whatsoever)
10
Signatures must be guaranteed by a member of the firm of a
registered national securities exchange, a member of the National
Association of Securities Dealers, Inc., or a commercial bank or trust
company having an office or correspondent in the United States.
------------------------------------------------------------
(To be completed if true)
The undersigned hereby represents, for the benefit of all holders of Rights
and shares of Common Stock, that the Rights evidenced by the enclosed
Rights Certificate are not, and, to the knowledge of the undersigned, have
never been, Beneficially Owned by an Acquiring Person or an Affiliate or
Associate thereof (as defined in the Rights Agreement).
_________________________
Signature
------------------------------------------------------------
NOTICE
In the event the certification set forth above is not completed
in connection with a purported exercise, the Company will deem the
Beneficial Owner of the Rights evidenced by the enclosed Rights Certificate
to be an Acquiring Person or an Affiliate or Associate thereof (as defined
in the Rights Agreement) or a transferee of any of the foregoing and
accordingly will deem the Rights evidenced by such Rights Certificate to be
void and not transferable or exercisable.
1
Exhibit B
MALLINCKRODT GROUP INC.
SUMMARY OF RIGHTS TO PURCHASE
COMMON STOCK
On March 19, 1986, the Board of Directors of MALLINCKRODT GROUP
INC. (the "Company") declared a dividend distribution of one Right for each
outstanding share of Common Stock, $1 par value per share (the "Common
Stock"), of the Company. The dividend distribution was effective on
March 31, 1986, payable to the stockholders of record on March 31, 1986.
The terms of the Rights were amended and restated by the Board of Directors
of the Company on February 19, 1996 in order to extend the expiration date
of the Rights and set a new purchase price per Right. Each Right now
entitles the record holder to purchase from the Company one share of Common
Stock at a price of $______ per share (the "Purchase Price"). The
description and terms of the Rights are set forth in an Amended and
Restated Rights Agreement, dated as of February 19, 1996 (as it may further
be amended, the "Rights Agreement"), between the Company and The First
National Bank of Chicago, as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) the Flip-in Date referred to
below or (ii) the tenth business day (or such later date as the Board may
decide) after any person (other than the Company, a wholly-owned Subsidiary
of the Company or an employee stock ownership or other employee benefit
plan of the Company or wholly-owned Subsidiary of the Company) commences a
tender offer that would result in such person (together with his affiliates
and associates) holding a total of 30% or more of the Common Stock (the
earlier of such dates being called the "Distribution Date"), the Rights
will be evidenced by the Company's Common Stock certificates.
On the date (the "Flip-in Date") when a person (together with
his affiliates and associates) has acquired, or has obtained the right to
acquire, 20% or more of the outstanding shares of Common Stock (an
"Acquiring Person"), each Right (other than Rights owned by an Acquiring
Person, his affiliates or associates or any transferees thereof, each of
whose Rights become void) will automatically become a right to buy, at the
Purchase Price, that number of shares of Common Stock having a market value
of twice the Purchase Price. If a Flip-in Date has occurred, the Board
may, under certain circumstances and in lieu of allowing Rights to be
exercised, exchange each outstanding Right (other than Rights that have
become void) for one share of Common Stock
2
(or, in certain cases, other securities or assets of the Company). In
addition, the Company may not consolidate or merge with, or sell 50% or
more of its assets or earning power to, any person unless proper provision
is made so that each Right would thereafter become a right to buy, at the
Purchase Price, that number of shares of common stock of such person having
a market value of twice the Purchase Price.
Until the close of business on the Distribution Date (or
earlier exchange, redemption or expiration of the Rights), Common Stock
certificates issued after February 19, 1996, upon transfer or new issuance,
will contain a notation incorporating the Rights Agreement by reference.
Until the close of business on the Distribution Date (or earlier exchange,
redemption or expiration of the Rights) the surrender for transfer of any
of the Company's Common Stock certificates, with or without the above
notation, 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 will be mailed to holders of record of the Company's Common Stock as
of the close of business on the Distribution Date and such separate
certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on February 28, 2006, unless earlier redeemed by the
Company as described below.
The Purchase Price payable, and the number of shares of Common
Stock or other securities issuable, upon exercise of the Rights are subject
to adjustment from time to time to prevent dilution (i) in the event of a
stock dividend on, or a subdivision, combination or reclassification of,
the Common Stock, (ii) upon the grant to record holders of Common Stock of
certain rights or warrants to subscribe for shares of Common Stock or
convertible securities at less than the then-current market price of the
Common Stock or (iii) upon the distribution to record holders of Common
Stock of evidences of indebtedness or assets (other than regular periodic
cash dividends at a rate not in excess of 200% of the rate of the last such
dividend or dividends payable in Common Stock) or of subscription rights or
warrants (other than those referred to above).
3
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an adjustment of at
least 1% in such Purchase Price. No fractional shares will be issued. In
lieu of fractional shares, 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 of the Rights.
At any time prior to the time a person shall become an
Acquiring Person, the Company may elect to redeem the Rights in whole, but
not in part, at a price of $.05 per Right (the "Redemption Price").
Immediately upon the action of the Board of Directors of the Company
electing to redeem the Rights, the Company shall make public announcement
thereof, and from the time of such announcement, the right to exercise the
Rights will terminate and the only right thereafter of the holders of
record of Rights will be to receive the Redemption Price, but without any
interest thereon. In addition, the Company may suspend the exercisability
of the Rights for up to 90 days after the Distribution Date or the Flip-in
Date for, among other reasons, to comply with federal or state securities
laws.
Until a Right is exercised for Common Stock, the holder
thereof, as such, will have no rights as a stockholder of the Company,
including, without limitation, the right to vote or to receive dividends.
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission (the "SEC") as an Exhibit to a
Form 8-A/A, dated February 26, 1996 and as an Exhibit to Form 8-K
dated the same date. A copy of the Rights Agreement and all amendments
thereto are available free of charge from the Rights Agent, The First
National Bank of Chicago. 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.