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FORM 8-A
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
ALEXANDER & BALDWIN, INC.
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(Exact name of registrant as specified in its charter)
Hawaii 99-0032630
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(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification No.)
822 Bishop Street, P. O. Box 3440
Honolulu, Hawaii 96801
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(Address of principal executive offices) (zip code)
Securities to be registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which
to be so registered each class is to be registered
None None
If this form relates to the registration of a class of securities pursuant
to Section 12(b) of the Exchange Act and is effective pursuant to General
Instruction A.(c), check the following box. [ ]
If this form relates to the registration of a class of securities pursuant
to Section 12(g) of the Exchange Act and is effective pursuant to General
Instruction A.(d), check the following box. [X]
Securities to be registered pursuant to Section 12(g) of the Act:
Common Stock Purchase Rights
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(Title of class)
ITEM 1. DESCRIPTION OF SECURITIES TO BE REGISTERED
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On June 25, 1998, the Board of Directors of Alexander & Baldwin, Inc.
(the "Company") declared a dividend distribution of one Right for each
outstanding share of common stock, without par value (the "Common Stock"),
of the Company to shareholders of record at the close of business on
December 19, 1998, or on such earlier date (if any) as existing common stock
purchase rights may be redeemed in accordance with the Company's shareholder
rights plan adopted December 8, 1988. Each Right entitles the registered
holder to purchase from the Company one share of Common Stock at a price of
$110 per share (the "Exercise Price"), subject to adjustment. The Exercise
Price shall be paid in cash. The description and terms of the Rights are set
forth in a Rights Agreement (the "Rights Agreement") dated as of June 25, 1998
between the Company and ChaseMellon Shareholder Services, L.L.C., as Rights
Agent.
Initially, the Rights will be attached to all Common Stock certificates
representing shares then outstanding, and no separate Rights Certificates will
be distributed. The Rights will separate from the Common Stock on the
Distribution Date, which is the earlier of (i) the date of the first public
announcement that a person (a "20% Stockholder") has become the beneficial
owner of 20% or more of the outstanding shares of Common Stock (the "20%
Ownership Date"), or (ii) the tenth business day (or such later day as shall
be designated by the Board of Directors) following the date of the commencement
of, or the announcement of an intention to make, a tender offer or exchange
offer, the consummation of which would cause a person to become a 20%
Stockholder. Until the Distribution Date, (i) the Rights will be evidenced by
the Common Stock certificates and will be transferred with, and only with, such
Common Stock certificates, (ii) Common Stock certificates issued after the
record date for distribution of the Rights will contain a notation
incorporating the Rights Agreement by reference, and (iii) the surrender for
transfer of any certificates for Common Stock outstanding also will constitute
the transfer of the Rights associated with the Common Stock represented by such
certificates.
The Rights are not exercisable until the Distribution Date and will expire
at the later of the close of business on (i) December 19, 2008, or (ii) the
tenth anniversary of the Distribution Date, unless earlier redeemed by the
Company as described below.
As soon as practicable after the Distribution Date, Rights Certificates
will be mailed to holders of record of the Common Stock as of the close of
business on the Distribution Date and, thereafter, the separate Rights
Certificates alone will represent the Rights.
Upon public announcement by the Company or a 20% Stockholder that a person
has become a 20% Stockholder, or such earlier date as a majority of the Board
of Directors becomes aware of the existence of the 20% Stockholder, each holder
of a Right thereafter will have the right to purchase, at the Exercise Price,
the number of shares of Common Stock with an aggregate market value equal to
two times the Exercise Price. Notwithstanding any of the foregoing, from and
after the Distribution Date, all Rights that are or were beneficially owned by
a 20% Stockholder will be null and void.
In the event that, at any time following the 20% Ownership Date, (i) the
Company is acquired in a merger or other business combination transaction in
which the Company is not the surviving corporation, (ii) the Company is the
surviving corporation in a merger or other business combination transaction in
which all or part of the Common Stock is changed into or exchanged for stock or
assets of another person, or (iii) 50% or more of the Company's assets or
earning power is sold or transferred (other than in the ordinary course of
business), each holder of a Right (except Rights which previously have been
voided as set forth above) thereafter shall have the right, upon payment of the
Exercise Price, to buy such number of shares of common stock of the surviving
corporation with an aggregate market value equal to two times the Exercise
Price of the Right.
The Exercise Price payable, and the number and kind of securities that may
be purchased, upon exercise of the Rights are subject to adjustment from time
to time to prevent dilution in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Common Stock.
With certain exceptions, no adjustment in the Exercise Price will be
required until cumulative adjustments amount to at least 1% of the Exercise
Price. No fractional shares of Common Stock will be issued and, in lieu
thereof, an adjustment in cash will be made based on the market price of the
Common Stock on the last trading date prior to the date of exercise.
At any time until the earliest of (i) the Distribution Date, (ii) the date
of the first event of the type giving rise to the right, described above, to
purchase shares of common stock of a surviving corporation, or (iii) the date
the Rights expire, the Company may redeem the Rights in whole, but not in part,
at a price of $.01 per Right, payable in cash, shares of Common Stock, other
securities of the Company, other property, or any combination thereof. Immedi-
ately upon the action of the Board of Directors ordering redemption of the
Rights, the right to exercise Rights will terminate and the only right
thereafter of the holders of Rights will be to receive the $.01 redemption
price.
At any time after the 20% Ownership Date and prior to the first date
thereafter upon which a 20% Stockholder becomes the beneficial owner of 50% or
more of the outstanding shares of Common Stock, the Company may exchange the
Rights in whole, but not in part, for shares of Common Stock (or cash,
property, or other securities) having a current value equal to the difference
between the Exercise Price and the current market price of the shares that
otherwise would be issuable upon exercise of a Right on such date. Immediately
upon the action of the Board of Directors ordering exchange of the Rights, the
right to exercise Rights will terminate and the only right thereafter of the
holders of Rights will be to receive the shares of Common Stock (or cash,
property or other securities) for which the Rights are to be exchanged.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of the Company, including, without limitation, the
right to vote or to receive dividends. While the distribution of the Rights
will not be taxable to shareholders or to the Company, shareholders may,
depending upon the circumstances, recognize taxable income in the event that
the Rights become exercisable.
The Rights Agreement may be amended by the Board of Directors of the
Company without the approval of any holder of Rights and whether or not such
amendment is adverse to any holder of Rights. However, after the earlier of
the 20% Ownership Date or the date the Board of Directors authorizes and
directs the redemption or exchange of Rights, the Rights Agreement may not be
amended in any manner that would materially and adversely affect any holder of
Rights (other than a 20% Stockholder).
ITEM 2. EXHIBITS
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4. Form of Rights Agreement, dated as of June 25, 1998, between
Alexander & Baldwin, Inc. and ChaseMellon Shareholder Services,
L.L.C., which includes as Exhibit A thereto the form of Rights
Certificate. Pursuant to the Rights Agreement, Rights Certificates
will not be mailed to shareholders until after the Distribution Date
(as that term is defined in the Rights Agreement).
SIGNATURE
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Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the registrant has duly caused this registration statement to be
signed on its behalf by the undersigned, thereto duly authorized.
Date: July 16, 1998
ALEXANDER & BALDWIN, INC.
By /s/ Michael J. Marks
Michael J. Marks
Vice President, General Counsel
and Secretary
EXHIBIT INDEX
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Exhibit Number Description
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4 Form of Rights Agreement, dated as of June 25, 1998,
between Alexander & Baldwin, Inc. and ChaseMellon
Shareholder Services, L.L.C., which includes as Exhibit A
thereto the form of Rights Certificate.
RIGHTS AGREEMENT
DATED AS OF JUNE 25, 1998
BY AND BETWEEN
ALEXANDER & BALDWIN, INC.
AND
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.,
AS RIGHTS AGENT
TABLE OF CONTENTS
Page
----
Section 1. Certain Definitions.............................................2
Section 2. Appointment of Rights Agent.....................................9
Section 3. Issuance of Right Certificates..................................9
Section 4. Form of Right Certificates.....................................12
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.............................................14
Section 8. Cancellation and Destruction of Right Certificates.............17
Section 9. Reservation and Availability of Capital Stock..................18
Section 10. Securities Record Date.........................................19
Section 11. Adjustment of Exercise Price, Number of Shares Issuable
Upon Exercise of Rights or Number of Rights....................19
Section 12. Certificate of Adjusted Exercise Price or Number of Shares
Issuable Upon Exercise of Rights...............................27
Section 13. Consolidation, Merger, or Sale or Transfer of Assets or
Earning Power..................................................27
Section 14. Fractional Rights and Fractional Shares........................31
Section 15. Rights of Action...............................................31
Section 16. Agreement of Right Holders.....................................32
Section 17. Right Holder and Right Certificate Holder Not Deemed a
Stockholder....................................................33
Section 18. Concerning the Rights Agent....................................34
Section 19. Merger or Consolidation or Change of Name of Rights Agent......34
Section 20. Duties of Rights Agent.........................................35
Section 21. Change of Rights Agent.........................................38
Section 22. Issuance of New Right Certificates.............................39
Section 23. Redemption of Rights...........................................39
Section 24. Exchange of Rights.............................................41
Section 25. Notice of Certain Events.......................................42
Section 26. Notices........................................................43
Section 27. Supplements and Amendments.....................................44
Section 28. Certain Covenants..............................................44
Section 29. Successors.....................................................45
Section 30. Benefits of this Agreement.....................................45
Section 31. Severability...................................................45
Section 32. Governing Law..................................................46
Section 33. Counterparts...................................................46
Section 34. Descriptive Headings...........................................46
Exhibit A Form of Right Certificate.......................................A-1
RIGHTS AGREEMENT
This Rights Agreement ("Agreement") is made and entered into as of the
25th day of June, 1998 by and between Alexander & Baldwin, Inc., a Hawaii
corporation (the "Company"), and ChaseMellon Shareholder Services, L.L.C. (the
"Rights Agent").
WHEREAS, on December 8, 1988 the Company adopted a stockholder rights plan
and declared a dividend of common stock purchase rights (the "1988 Rights");
and as of the same date the Company entered into a Rights Agreement with
Manufacturers Hanover Trust Company, as Rights Agent (the "1988 Rights
Agreement");
WHEREAS, the 1988 Rights expire on December 19, 1998 or on such earlier
date as they may be redeemed in accordance with the terms and provisions of the
1988 Rights Agreement;
WHEREAS, the Board of Directors of the Company has determined that it is
in the best interests of the Company to enter into this Agreement and to
distribute new rights upon the expiration or redemption of the 1988 Rights,
in order that the Company will have the benefit of continuous protection
pursuant to an effective stockholder rights plan;
WHEREAS, the Board of Directors of the Company has authorized and declared
a dividend of one common stock purchase right (a "Right") for each Common Share
(as hereinafter defined) of the Company, which dividend is payable on December
19,1988, or on such earlier date as the 1988 Rights may be redeemed, (the
"Record Date") to the holders of record of Common Shares as of the Close of
Business (as hereinafter defined) on such date;
WHEREAS, the Board of Directors of the Company has further authorized and
directed the issuance of one Right for (A) each Common Share that shall be
issued by the Company at any time after the Record Date and prior to the
earliest of the Distribution Date, the Redemption Date or the Expiration Date
(as such terms are hereinafter defined), and (B) each Common Share that shall
be issued by the Company at any time on or after the earlier of the
Distribution Date, and prior to the earlier of the Redemption Date or the
Expiration Date pursuant to the exercise of conversion rights, exchange rights,
rights (other than Rights), warrants or options that shall have been issued or
granted prior to the earlier of the Distribution Date, unless the Board of
Directors shall provide otherwise at the time of the issuance or grant of such
conversion rights, exchange rights, rights (other than Rights), warrants or
options; and
WHEREAS, in connection with the matters referred to herein, the Company
desires to appoint the Rights Agent to act on behalf of the Company for the
benefit of the holders of Rights, and the Rights Agent is willing so to act;
NOW, THEREFORE, in consideration of the foregoing recitals and the mutual
agreements set forth herein, and for the benefit of the holders of Rights, the
parties hereto hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement, the
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following terms have the meanings indicated:
(a) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 promulgated under the Exchange Act, as in
effect on the date hereof.
(b) A Person shall be deemed the "Beneficial Owner" of and shall be
deemed to "Beneficially Own":
(i) any securities that such Person or any of such Person's
Affiliates or Associates beneficially owns, directly or indirectly, for
purposes of Section 13(d) of the Exchange Act and Rule 13d-3 promulgated
under the Exchange Act, in each case as in effect on the date hereof;
(ii) any securities that such Person or any of such Person's
Affiliates or Associates has the right to acquire (whether such right is
exercisable immediately, or only after the passage of time, compliance
with regulatory requirements, the fulfillment of a condition, or
otherwise) pursuant to any agreement, arrangement or understanding, or
upon the exercise of conversion rights, exchange rights, rights (other
than the Rights), warrants or options, or otherwise, provided that a
Person shall not be deemed the Beneficial Owner of, or to Beneficially
Own, securities tendered pursuant to a tender offer or exchange offer made
by or on behalf of such Person or any of such Person's Affiliates or
Associates until such tendered securities are accepted for purchase or
exchange;
(iii) any securities that such Person or any of such Person's
Affiliates or Associates has the right to vote, alone or in concert with
others, pursuant to any agreement, arrangement or understanding, provided
that a Person shall not be deemed the Beneficial Owner of, or to
Beneficially Own, any security if the agreement, arrangement or
understanding to vote such security (A) arises solely from a revocable
proxy given to such Person or any of such Person's Affiliates or
Associates in response to a public proxy solicitation made pursuant to and
in accordance with the applicable rules and regulations of the Exchange
Act, and (B) is not also then reportable on Schedule 13D under the
Exchange Act (or any comparable or successor report);
(iv) any securities that 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 for the purpose of acquiring, holding, voting (other than
voting pursuant to a revocable proxy as described in the proviso to
Section 1(b)(iii) hereof) or disposing of any securities of the Company;
and
(v) on any day on or after the Distribution Date, all Rights
that prior to such date were represented by certificates for Common Shares
that such Person Beneficially Owns on such day.
Notwithstanding anything to the contrary in this Section 1(b), a
Person engaged in business as an underwriter of securities shall not be deemed
to be the Beneficial Owner of, or to Beneficially Own, any securities acquired
through such Person's participation in good faith in a firm commitment
underwriting until the expiration of 40 days after the date of such
acquisition.
(c) "Business Day" shall mean any day other than a Saturday, a
Sunday or a day on which banking institutions in the State of Hawaii are
authorized or obligated by law or executive order to close.
(d) "Close of Business" on any given date shall mean
5:00 o'clock p.m., Hawaii time, on such date; provided, however, that if such
date is not a Business Day, it shall mean 5:00 o'clock p.m., Hawaii time, on
the next succeeding Business Day.
(e) "Closing Price" of a stock or other security on any day shall be
the last sale price, regular way, per share of such stock or unit of such other
security on such day 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 such stock or other security is not listed or admitted to
trading on the New York Stock Exchange, as reported in the principal consoli-
dated transaction reporting system with respect to securities listed on the
principal national securities exchange on which such stock or other security is
listed or admitted to trading or, if such stock or other security is not listed
or admitted to trading on any national securities exchange, the last quoted
sale price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by the National Association
of Securities Dealers, Inc. Automated Quotations System ("NASDAQ") or such
other system then in use or, if on any such date such stock or other security
is not quoted by any such organization, the average of the closing bid and
asked prices as furnished by a professional market maker that makes a market
in such stock or other security and that is selected by the Board of Directors
of the Company.
(f) "Common Share" shall mean one share of the common stock, without
par value, of the Company, unless used with reference to a Person other than
the Company, in which case it shall mean one share of the class of capital
stock (or equity interest) of such other Person having the greatest voting
power per share or, if such Person is a Subsidiary of another Person, of the
Person that ultimately controls such Person.
(g) "Common Share Equivalent" shall have the meaning ascribed to in
Section 11(b) hereof.
(h) "Current Market Price" per share of a stock or unit of any other
security on any date shall mean the average of the daily Closing Prices of such
stock or other security for the 30 consecutive Trading Days through and
including the Trading Day immediately preceding the date in question; provided,
however, that if any event shall have caused the Closing Price on any Trading
Day during such 30-day period not to be fully comparable with the Closing Price
on the date in question (or, if no Closing Price is available on the date in
question, on the Trading Day immediately preceding the date in question), then
each such noncomparable Closing Price so used shall be appropriately adjusted
by the Board of Directors of the Company in order to make the Closing Price on
each Trading Day during the period used for the determination of the Current
Market Price fully comparable with the Closing Price on such date in question
(or, if applicable, the immediately preceding Trading Day). "Current Market
Price" per share of any stock or unit of such other security that is not
publicly held or so listed or traded, and "Current Market Price" of any other
property, shall mean the fair value per share of such stock or unit of such
other security, or the fair value of such other property, respectively, as
determined in good faith by the Board of Directors of the Company based upon
such appraisals or valuation reports of such independent experts as the Board
of Directors shall in good faith determine appropriate, which determination
shall be described in a statement filed by the Company with the Rights Agent.
(i) "Distribution Date" shall have the meaning ascribed to it in
Section 3 hereof.
(j) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
(k) "Exchange Consideration" shall have the meaning ascribed to it
in Setion 24(a) hereof.
(l) "Exempt Person" shall mean the Company, any wholly-owned
Subsidiry of the Company, any employee benefit plan of the Company or of a
Subsidiary of the Company, and any Person holding Voting Shares for or pursuant
to the terms of any such employee benefit plan.
(m) "Exercise Price" shall have the meaning ascribed to it in
Section 7(c) hereof.
(n) "Expiration Date" shall mean the later of: (i) December 19,
2008, or (ii) the tenth anniversary of the Distribution Date.
(o) "Person" shall mean any individual, firm, partnership,
corporation, association, group (as such term is used in Rule 13d-5 promulgated
under the Exchange Act as in effect on the date hereof) or other entity, and
shall include any successor (by merger or otherwise) of such entity.
(p) "Record Date" shall have the meaning ascribed to it in the
Recitals hereto.
(q) "Redemption Date" shall mean the date of the action of the Board
of Directors of the Company authorizing and directing the redemption of the
Rights pursuant to Section 23(a) hereof or (unless a different date is
specified as provided in Section 24(b)) the exchange of the Rights pursuant to
Section 24(a) hereof.
(r) "Redemption Price" shall have the meaning ascribed to it in
Section 23(a) hereof.
(s) "Right" shall have the meaning ascribed to it in the Recitals
hereto.
(t) "Rights Agent" shall have the meaning ascribed to it in the
Recitals hereto.
(u) "Section 11(a)(ii) Event" shall have the meaning ascribed to it
in Section 11(a)(ii) hereof.
(v) "Section 13(a) Event" shall have the meaning ascribed to it in
Section 13(a) hereof.
(w) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(x) "Subsidiary" of any Person shall mean any corporation or other
Person of which equity securities or equity interests representing a majority
of the voting power are owned, directly or indirectly, or which is effectively
controlled, by such Person.
(y) "Surviving Person" shall have the meaning ascribed to it in
Section 13(a) hereof.
(z) "Trading Day" shall mean, as to any stock or other security, a
day on which the principal national securities exchange or other market on
which such stock or other security is listed or admitted to trading is open for
the transaction of business or, if such stock or other security is not listed
or admitted to trading on any national securities exchange or other market, a
Business Day.
(aa) "Unavailable Adjustment Shares" has the meaning ascribed to it
in Section 11(a)(iii) hereof.
(bb) "Voting Share" shall mean (i) a Common Share of the Company and
(ii) any other share of capital stock of the Company entitled to vote generally
in the election of directors or entitled to vote together with the Common
Shares in respect of any merger, consolidation, sale of all or substantially
all of the Company's assets, liquidation, dissolution or winding up.
References in this Agreement to a percentage or portion of the outstanding
Voting Shares shall be deemed a reference to the percentage or portion of
the total votes entitled to be cast by the holders of the outstanding Voting
Shares.
(cc) "20% Ownership Date" shall mean the first date of public
announcement (which, for purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 13(d) of the Exchange Act) by
the Company or a 20% Stockholder containing the facts by virtue of which a
Person has become a 20% Stockholder or such earlier date as a majority of the
Board of Directors of the Company shall become aware of the existence of a
20% Stockholder.
(dd) "20% Stockholder" shall mean any Person that, together with all
Affiliates and Associates of such Person, at any time after the date of this
Agreement becomes the Beneficial Owner of such number of Voting Shares of the
Company as constitutes a percentage of the then outstanding Voting Shares that
is equal to or greater than 20%; provided, however, that the term
"20% Stockholder" shall not include: (i) an Exempt Person; (ii) any Person if
such Person would not otherwise be a 20% Stockholder but for a reduction in the
number of outstanding Voting Shares resulting from a stock repurchase program
or other similar plan of the Company or from a self-tender offer of the
Company, which plan or tender offer commenced on or after the date hereof,
provided, however, that the term "20% Stockholder" shall include such Person
from and after the first date upon which (A) such Person, since the date of the
commencement of such plan or tender offer, shall have acquired Beneficial
Ownership of, in the aggregate, a number of Voting Shares of the Company equal
to 1% or more of the Voting Shares of the Company then outstanding and (B) such
Person, together with all Affiliates and Associates of such Person, shall
Beneficially Own 20% or more of the Voting Shares of the Company then
outstanding; or (iii) any Person if such Person is the Beneficial Owner of 20%
or more of the outstanding Voting Shares of the Company as of the date of this
Agreement, provided, however, that the term "20% Stockholder" shall include
such Person from and after the first date upon which (A) such Person, since the
date of this Agreement, shall have acquired, without the prior approval of the
Board of Directors of the Company, Beneficial Ownership of, in the aggregate, a
number of Voting Shares of the Company equal to 1% or more of the Voting Shares
of the Company then outstanding and (B) such Person, together with all
Affiliates and Associates of such Person, shall Beneficially Own 20% or more of
the Voting Shares of the Company then outstanding. In calculating the
percentage of the outstanding Voting Shares that are Beneficially Owned by a
Person for purposes of this subsection (cc), Voting Shares that are
Beneficially Owned by such Person shall be deemed outstanding, and Voting
Shares that are not Beneficially Owned by such Person and that are subject to
issuance upon the exercise or conversion of outstanding conversion rights,
exchange rights, rights (other than Rights), warrants or options shall not be
deemed outstanding. Notwithstanding the foregoing, if the Board of Directors
of the Company determines that a Person that would otherwise be a 20%
Stockholder pursuant to the foregoing provisions of this Section 1(cc) and
Section 1(b) hereof has become such inadvertently, and such Person (i) promptly
notifies the Board of Directors of such status and (ii) as promptly as
practicable thereafter, either divests a sufficient number of Voting Shares so
that such Person would no longer be a 20% Stockholder, or causes any other
circumstance, such as the existence of an agreement respecting Voting Shares,
to be eliminated such that such Person would no longer be a 20% Stockholder as
defined pursuant to this Section 1(dd) and 1(b), or enters into such other
agreement or arrangement as the Board of Directors of the Company may approve,
then such Person shall not be deemed to be a 20% Stockholder for any purposes
of this Agreement. Any determination made by the Board of Directors of the
Company as to whether any Person is or is not a 20% Stockholder shall be
conclusive and binding upon all holders of Rights.
(ee) "1988 Rights" shall have the meaning ascribed to it in the
Recitals.
(ff) "1988 Rights Agreement" shall have the meaning ascribed to it in
the Recitals.
Section 2. Appointment of Rights Agent. The Company hereby appoints the
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Rights Agent to act as agent for the Company, 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, upon ten days' prior
written notice to the Rights Agent. The Rights Agent shall have no duty to
supervise, and shall in no event be liable for, the acts or omissions of any
such co-Rights Agent.
Section 3. Issuance of Right Certificates.
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(a) "Distribution Date" shall mean the date, after the date hereof
that is the earliest of (i) the tenth Business Day (or such later day as shall
be designated by the Board of Directors of the Company) following the date of
the commencement of, or the first public announcement of the intent of any
Person, other than an Exempt Person, to commence a tender offer or exchange
offer, the consummation of which would cause any Person to become a
20% Stockholder or (ii) the date of the first Section 11(a)(ii) Event;
provided, however, that if any such date which would otherwise constitute the
Distribution Date occurs before the Record Date, the Distribution Date shall be
the Record Date.
(b) Until the Distribution Date, (i) the Rights shall be represented
by certificates for Common Shares (all of which certificates for Common Shares
shall be deemed to be Right Certificates) and not by separate Right
Certificates, (ii) the record holder of the Common Shares represented by each
of such certificates shall be the record holder of the Rights represented
thereby and (iii) the Rights shall be transferable only in connection with the
transfer of Common Shares. Until the earliest of the Distribution Date, the
Redemption Date or the Expiration Date, the surrender for transfer of such
certificates for Common Shares shall also constitute the surrender for transfer
of the Rights represented thereby.
(c) As soon as practicable after the Distribution Date, and after
notification by the Company, the Rights Agent shall send, at the Company's
expense, by first-class, postage-prepaid mail to each record holder of Common
Shares, 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
substantially in the form of Exhibit A hereto representing one Right for each
Common Share so held. From and after the Distribution Date, the Rights shall
be represented solely by such Right Certificates and may only be transferred by
the transfer of such Right Certificates, and the holders of such Right
Certificates, as listed in the records of the Company or any transfer agent or
registrar for such Rights, shall be the record holders of such Rights.
(d) Certificates for Common Shares issued at any time after the
Record Date and prior to the earliest of the Distribution Date, the Redemption
Date or the Expiration Date, shall have impressed on, printed on, written on or
otherwise affixed to them the following legend:
"This certificate also represents Rights that entitle the holder
hereof to certain rights as set forth in a Rights Agreement dated as
of June 25, 1998, 1998 by and between the Corporation and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent (as it may be amended
from time to time, the "Rights Agreement"), the terms and conditions
of which are hereby incorporated herein by reference and a copy of
which is on file at the principal executive offices of the
Corporation.
Under certain circumstances specified in the Rights Agreement,
such Rights will be represented by separate certificates and will no
longer be represented by this certificate. Under certain
circumstances specified in the Rights Agreement, Rights beneficially
owned by certain persons may become null and void. The Corporation
will mail to the record holder of this certificate a copy of the
Rights Agreement without charge promptly following receipt of a
written request therefor."
(e) Certificates for Common Shares issued at any time on or after
the Distribution Date and prior to the earlier of the Redemption Date or the
Expiration Date shall have impressed on, printed on, written on or otherwise
affixed to them the following legend:
"This certificate does not represent any Right issued pursuant to
the terms of a Rights Agreement dated as of June 25, 1998 by and
between the Corporation and ChaseMellon Shareholder Services, L.L.C.,
as Rights Agent."
(f) In the event that at any time on or after the Distribution Date
and prior to the earlier of the Redemption Date or the Expiration Date, the
Company shall issue any Common Shares pursuant to the exercise of conversion
rights, exchange rights, rights (other than Rights), warrants or options that
shall have been issued or granted prior to the Distribution Date, then, unless
the Board of Directors of the Company shall have provided otherwise at the time
of the issuance or grant of such conversion rights, exchange rights, rights
(other than Rights), warrants or options, the Rights Agent shall, as soon as
practicable after the date of such event, send by first-class, postage-prepaid
mail to the record holder of such Common Shares, at the address of such holder
as shown on the records of the Company, a Right Certificate substantially in
the form of Exhibit A hereto representing one Right for each Common Share so
issued.
(g) Notwithstanding the foregoing provisions of this Section 3, the
Rights Agent shall not send any Right Certificate to any 20% Stockholder or any
of its Affiliates or Associates or to any Person if the Rights held by such
Person are Beneficially Owned by a 20% Stockholder or any of its Affiliates or
Associates. Any determination made by the Board of Directors of the Company as
to whether any Common Shares are or were Beneficially Owned at any time by a
20% Stockholder or an Affiliate or Associate of a 20% Stockholder shall be
conclusive and binding upon all holders of Rights.
Section 4. Form of Right Certificates. The Right Certificates and the
--------------------------
form of assignment, including certificate, and the form of election to
purchase, including certificate, printed on the reverse thereof, when, as and
if issued, shall be substantially the same as Exhibit A hereto, and may have
such marks of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange upon which the
Rights or the securities of the Company issuable upon exercise of the Rights
may from time to time be listed, or to conform to usage. Subject to Section 22
hereof, Right Certificates, whenever issued, that are issued in respect of
Common Shares that were issued and outstanding as of the Close of Business on
the Distribution Date, shall be dated as of the Distribution Date.
Section 5. Countersignature and Registration.
---------------------------------
(a) 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 may have affixed thereto the
Company's seal or a facsimile thereof attested by its Secretary or any
Assistant Secretary, either manually or by facsimile signature. The Right
Certificates shall be countersigned by an authorized signatory of the Rights
Agent (which need not be the same authorized signatory for all of the Right
Certificates) and shall not be valid for any purpose unless so countersigned.
In case any officer of the Company who shall have signed any of the Right
Certificates shall cease to be such officer of the Company before counter-
signature by the Rights Agent and issuance and delivery by the Company, such
Right Certificates may nevertheless be countersigned by an authorized signatory
of the Rights Agent and issued and delivered by the Company 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 such execution
shall be a proper officer of the Company to sign such Right Certificate, even
though such person was not such an officer at the date of the execution of this
Agreement.
(b) Following the Distribution Date, the Rights Agent shall keep or
cause to be kept at its principal offices in Ridgefield Park, New Jersey, books
for registration and transfer of the Right Certificates issued hereunder. Such
books shall show the names and addresses of the respective holders of Right
Certificates, the number of Rights represented on its face by each Right
Certificate and the date of each Right Certificate.
Section 6. Transfer, Split Up, Combination and Exchange of Right
-----------------------------------------------------
Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates.
- ---------------------------------------------------------------------
(a) Subject to the provisions of Sections 6(c), 7(d) and 14 hereof,
at any time after the Close of Business on the Distribution Date, and so long
as the Rights represented thereby remain outstanding, any one or more Right
Certificates may be transferred, split up, combined or exchanged for one or
more Right Certificates representing the same aggregate number of Rights as the
Right Certificates surrendered. Any registered holder desiring to transfer,
split up, combine or exchange one or more Right Certificates shall make such
request in writing delivered to the Rights Agent, and shall surrender the Right
Certificates to be transferred, split up, combined or exchanged at the office
of the Rights Agent with the form of assignment, including certificate, on the
reverse side thereof completed and duly executed, with signature guaranteed and
such other and further documentation as the Rights Agent may reasonably
request. Thereupon, the Rights Agent shall countersign and deliver to the
person entitled thereto one or more Right Certificates, as so requested. The
Company may require payment of a sum sufficient to cover any tax or govern-
mental charge that may be imposed in connection with any transfer, split up,
combination or exchange of Right Certificates.
(b) Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation
of a Right Certificate, and, in case of loss, theft or destruction, of
indemnity or security reasonably satisfactory to them and, at the Company's
request, reimbursement to the Company and the Rights Agent of all reasonable
expenses incidental thereto, and upon surrender to the Rights Agent and
cancellation of such Right Certificate, if mutilated, along with signature
guarantees and such other and further documentation as the Rights Agent may
reasonably request, the Company shall issue and deliver to the Rights Agent for
delivery to the record holder of such Right Certificate a new Right Certificate
of like tenor in lieu of such lost, stolen, destroyed or mutilated Right
Certificate.
(c) Notwithstanding anything to the contrary in this Section 6, the
Rights Agent shall not countersign and deliver a Right Certificate to any
Person if such Right Certificate represents, or would represent when held by
such Person, Rights that had become or would become null and void pursuant to
Section 7(d) hereof.
Section 7. Exercise of Rights.
------------------
(a) Until the Distribution Date, no Right may be exercised.
(b) Subject to Section 7(d) and (g) hereof and the other provisions
of this Agreement, at any time after the Close of Business on the Distribution
Date and prior to the Close of Business on the earlier of the Redemption Date
or the Expiration Date, the registered holder of any Right Certificate may
exercise the Rights represented thereby in whole or in part upon surrender of
such Right Certificate, with the form of election to purchase, including
certificate, on the reverse side thereof completed and duly executed, to the
Rights Agent at the office of the Rights Agent in Ridgefield Park, New Jersey,
along with a signature guarantee and such other and further documentation as
the Rights Agent may reasonably request, together with payment of the Exercise
Price for each Right exercised. Upon the exercise of an exercisable Right and
payment of the Exercise Price in accordance with the provisions of this
Agreement, the holder of such Right shall be entitled to receive, subject to
adjustment as provided herein, one Common Share (or, following the occurrence
of a Section 11(a)(ii) Event or a Section 13(a) Event, Common Shares, other
securities cash and/or other property in accordance with the provisions of this
Agreement).
(c) The Exercise Price for each Common Share pursuant to the
exercise of each Right shall initially be $110 (One Hundred and Ten Dollars)
and shall be payable in lawful money of the United States of America in
accordance with Section 7(f) hereof. The Exercise Price and the number of
Common Shares (or, following the occurrence of a Section 11(a)(ii) Event or a
Section 13(a) Event, cash, securities and/or other property in accordance with
the provisions of this Agreement) to be acquired upon exercise of a Right shall
be subject to adjustment from time to time as provided in Sections 7(e), 11 and
13 hereof and the other provisions of this Agreement.
(d) Notwithstanding anything in this Agreement to the contrary, from
and after the Distribution Date, any Rights that are or were Beneficially Owned
by (i) a 20% Stockholder or any Affiliate or Associate of a 20% Stockholder,
(ii) a transferee of a 20% Stockholder (or of any such Associate or Affiliate)
who becomes a transferee after the 20% Stockholder becomes such, or (iii) a
transferee of a 20% Stockholder (or of any such Associate or Affiliate) who
becomes a transferee prior to or concurrently with a 20% Stockholder becoming
such and receives such Rights pursuant to either (A) a transfer (whether or not
for consideration) from the 20% Stockholder to holders of equity interests in
such 20% Stockholder or to any Person with whom the 20% Stockholder has any
continuing agreement, arrangement or understanding regarding the transferred
Rights, or (B) a transfer which the Board of Directors of the Company has
determined is part of a plan, arrangement or understanding which has as a
primary purpose or effect the avoidance of this Section 7(d), at any time on or
after the Distribution Date shall be null and void, and for all purposes of
this Agreement such Rights shall thereafter be deemed not to be outstanding,
and any holder of such Rights (whether or not such holder is a 20% Stockholder
or an Affiliate or Associate of a 20% Stockholder) shall thereafter have no
right to exercise such Rights.
(e) Prior to the Distribution Date, if the Board of Directors of the
Company shall have determined that such action adequately protects the
interests of the holders of Rights, the Company may, in its discretion,
substitute for all or any portion of the Common Shares that would otherwise be
issuable (after the Close of Business on the Distribution Date) upon the
exercise of each Right and payment of the Exercise Price, (i) cash, (ii) other
equity or debt securities of the Company, (iii) other property or (iv) any
combination of the foregoing, in each case having an aggregate Current Market
Price equal to the aggregate Current Market Price of the Common Shares for
which substitution is made. Subject to Section 7(d) hereof, in the event that
the Company takes any action pursuant to this Section 7(e), such action shall
apply uniformly to all outstanding Rights.
(f) Upon receipt of a Right Certificate representing exercisable
Rights, with the form of election to purchase, including certificate, completed
and duly executed, with signature guaranteed, accompanied by payment of the
Exercise Price for each Right to be exercised and an amount equal to any
applicable transfer tax required to be paid by the holder of such Right
Certificate in accordance with Section 9 hereof by certified check or cashier's
check payable to the order of the Company, the Rights Agent shall thereupon
promptly (i) requisition from the transfer agent of the Common Shares (or,
following the occurrence of a Section 11(a)(ii) Event or a Section 13(a) Event,
other securities in accordance with the provisions of this Agreement),
certificates for the number of Common Shares (or such other securities) to be
purchased, and the Company hereby irrevocably authorizes such transfer agent to
comply with all such requests, (ii) when appropriate, requisition from the
Company the amount of cash or property to be delivered upon exercise of such
Rights in accordance with the provisions hereof, (iii) after receipt of such
certificates, cause the same to be delivered to or upon the order of the
registered holder of such Right Certificate, registered in such name or names
as may be designated by such holder and (iv) when appropriate, after receipt
thereof, deliver such cash and/or property to or upon the order of the
registered holder of such Right Certificate.
(g) Notwithstanding the foregoing provisions of this Section 7, the
exercisability of the Rights shall be suspended for such period as shall
reasonably be necessary for the Company to register under the Securities Act
and any applicable securities law of any jurisdiction the Common Shares or
other securities to be issued pursuant to the exercise of the Rights;
provided, however, that nothing contained in this Section 7 shall relieve the
Company of its obligations under Section 9(c) hereof.
(h) In case the registered holder of any Right Certificate shall
exercise less than all of the Rights represented thereby, a new Right
Certificate representing Rights equivalent to the Rights remaining unexercised
shall be issued by the Rights Agent to the registered holder of such Right
Certificate or to such holder's 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 canceled
form, or, if surrendered to the Rights Agent, shall be canceled by it, and no
Right Certificates shall be issued in lieu thereof except as expressly
permitted by this Agreement. The Company shall deliver to the Rights Agent
for cancellation and retirement, and the Rights Agent shall so cancel and
retire, any other Right Certificate purchased or acquired by the Company
otherwise than upon the exercise thereof. The Rights Agent shall deliver all
canceled Right Certificates to the Company.
Section 9. Reservation and Availability of Capital Stock.
---------------------------------------------
(a) Subject to Section 7(e) hereof, the Company shall cause to be
reserved and kept available out of its authorized and unissued equity
securities (or out of its authorized and issued equity securities held in its
treasury), the number of such equity securities that will from time to time be
sufficient to permit the exercise in full of all outstanding Rights.
(b) In the event that any securities issuable upon exercise of the
Rights are listed on any national securities exchange, the Company shall use
its best efforts, from and after such time as the Rights become exercisable, to
cause all such securities issued or reserved for such issuance to be listed on
such exchange upon official notice of issuance upon such exercise.
(c) If necessary to permit the issuance of securities upon exercise
of the Rights, the Company shall use its best efforts, from and after the
Distribution Date, to register such securities under the Securities Act and any
applicable state securities laws and to keep such registration effective until
the earlier of the Redemption Date or the Expiration Date.
(d) The Company shall take all such action as may be necessary to
ensure that all securities delivered upon exercise of the Rights shall, at the
time of delivery of the certificates for such securities (subject to payment of
the Exercise Price), be duly and validly authorized and issued and fully paid
and nonassessable securities.
(e) The Company shall pay when due and payable any and all federal
and state transfer taxes and charges that may be payable in respect of the
issuance or delivery of the Right Certificates or of any securities upon the
exercise of Rights. The Company shall not, however, be required to pay any
transfer tax that may be payable in respect of any transfer or delivery of a
Right Certificate to a Person other than, or the issuance or delivery of a
certificate for securities in respect of a name other than that of, the
registered holder of the Right Certificate representing Rights surrendered for
exercise, or to issue or deliver any certificate for securities upon the
exercise of any Right 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.
(f) With respect to the Common Shares and/or other securities
issuable pursuant to Section 11(a)(ii) and (iii) hereof, the foregoing
covenants shall be applicable only upon and following the occurrence of a
Section 11(a)(ii) Event.
Section 10. Securities Record Date. Each person in whose name any
----------------------
certificate for securities of the Company is issued upon the exercise of Rights
shall for all purposes be deemed to have become the holder of record of the
securities represented thereby on, and such certificate shall be dated, the
date upon which the Right Certificate representing such Rights was duly
surrendered and payment of the Exercise Price (and any applicable transfer
taxes) was made; provided, however, that if the date of such surrender and
payment is a date upon which the securities transfer books of the Company are
closed, such person shall be deemed to have become the record holder of such
securities on, and such certificate shall be dated, the next succeeding
Business Day on which the securities transfer books of the Company are open.
Section 11. Adjustment of Exercise Price, Number of Shares Issuable Upon
------------------------------------------------------------
Exercise of Rights or Number of Rights. The Exercise Price, the number and
- --------------------------------------
kind of securities that may be purchased upon exercise of a Right and the
number of Rights outstanding are subject to adjustment from time to time as
provided in this Section 11.
(a) (i) In the event that the Company shall at any time after the
Close of Business on the Record Date and prior to the Close of Business on
the earlier of the Redemption Date or the Expiration Date (A) declare or
pay any dividend on the Common Shares payable in Common Shares or Voting
Shares, (B) subdivide the outstanding Common Shares, (C) combine the
outstanding Common Shares into a smaller number of Common Shares or
(D) issue Common Shares or Voting Shares in a reclassification of the
Common Shares (including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing or
surviving corporation), then, and upon each such event, the Exercise Price
in effect on the date of such event and the number and kind of Common
Shares or other securities issuable upon the exercise of a Right on the
date of such event shall be proportionately adjusted so that the holder
of any Right exercised on or after such date shall be entitled to receive,
upon the exercise thereof and payment of the Exercise Price, the aggregate
number and kind of Common Shares or other securities or other property, as
the case may be, that, if such Right had been exercised immediately prior
to such date and at a time when such Right was exercisable and the
transfer books of the Company were open, such holder would have owned upon
such exercise and would have been entitled to receive by virtue of such
dividend, subdivision, combination or reclassification. If an event
occurs that would require an adjustment under both this Section
11(a)(i) and Section 11(a)(ii) hereof, the adjustment provided for in this
Section 11(a)(i) shall be in addition to, and shall be made prior to, any
adjustment required pursuant to Section 11(a)(ii) hereof.
(ii) In the event (a "Section 11(a)(ii) Event") that at any
time after June 25, 1998, a 20% Ownership Date shall have occurred and
neither the Redemption Date nor the Expiration Date shall have occurred,
then, effective as of the 20% Ownership Date, proper provision shall be
made so that except as provided in Section 7(d) hereof, each holder of a
Right shall thereafter have the right to receive, upon the exercise
thereof in accordance with the terms of this Agreement and payment of the
then-current Exercise Price, in lieu of the securities or other property
otherwise purchasable upon such exercise, such number of Common Shares of
the Company as shall equal the result obtained by multiplying the then
current Exercise Price by the then number of Common Shares for which a
Right was exercisable (or, if the Distribution Date shall not have
occurred prior to the date of such Section 11(a)(ii) Event, the number of
Common Shares for which a Right would have been exercisable if the
Distribution Date had occurred on the Business Day immediately preceding
the date of such Section 11(a)(ii)Event) immediately prior to such
Section 11(a)(ii) Event, and dividing that product by 50% of the Current
Market Price (determined pursuant to Section 11(d) hereof) of a Common
Share on the date of occurrence of the relevant Section 11(a)(ii) Event
(such number of shares being hereinafter referred to as the "Adjustment
Shares"). Successive adjustments shall be made pursuant to this paragraph
each time a Section 11(a)(ii) Event occurs.
(iii) In the event that on the date of a Section 11(a)(ii)
Event the aggregate number of Common Shares that are authorized by the
Company's restated articles of incorporation but not outstanding or
reserved for issuance for purposes other than upon exercise of the Rights
is less than the aggregate number of Adjustment Shares thereafter issuable
upon the exercise in full of the Rights in accordance with
Section 11(a)(ii) hereof (the excess of such number of Adjustment Shares
over and above such number of Common Shares being hereinafter referred to
as the "Unavailable Adjustment Shares"), then, and upon each such event,
the Company shall substitute for the pro rata portion of the Unavailable
Adjustment Shares that would otherwise be issuable thereafter upon the
exercise of each Right and payment of the Exercise Price, (A) cash,
(B) other equity or debt securities of the Company, (C) other property or
(D) any combination of the foregoing, in each case having an aggregate
Current Market Price equal to the aggregate Current Market Price of the
Unavailable Adjustment Shares for which substitution is made. Subject to
Section 7(d) hereof, in the event that the Company takes any action
pursuant to this Section 11(a)(iii), such action shall apply uniformly to
all outstanding Rights.
(b) In the event that the Company shall, at any time after the Close
of Business on the Record Date and prior to the Close of Business on the
earlier of the Redemption Date or the Expiration Date, fix a record date prior
to the earlier of the Redemption Date or the Expiration Date for the issuance
of rights, options or warrants to all holders of Common Shares entitling them
initially to subscribe for or purchase Common Shares (or shares having
substantially similar rights, privileges and preferences as the Common Shares
("Common Share Equivalents")) or securities convertible into Common Shares or
Common Share Equivalents, at a price per Common Share or Common Share
Equivalent (or having a conversion price per share, if a security convertible
into Common Shares or Common Share Equivalents) less than the Current Market
Price per Common Share on such record date, then, and upon each such event, the
Exercise Price to be in effect after such record date shall be determined by
multiplying the Exercise Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be equal to the sum of the number
of Common Shares outstanding on such record date plus the number of Common
Shares that the aggregate offering price of the total number of Common Shares
and/or Common Share Equivalents to be so offered (and/or the aggregate initial
conversion price of the convertible securities to be so offered) would purchase
at such Current Market Price, and the denominator of which shall be equal to
the number of Common Shares outstanding on such record date plus the number of
additional Common Shares and/or Common Share Equivalents to be offered for
subscription or purchase (or into which the convertible securities to be so
offered are initially convertible); provided, however, that if such rights,
options or warrants are not exercisable immediately upon issuance but become
exercisable only upon the occurrence of a specified event or the passage of a
specified period of time, then the adjustment to the Exercise Price shall be
made and become effective only upon the occurrence of such event or such
passage of time, and such adjustment shall be made as if the record date for
the issuance of such rights, options or warrants had been the Business Day
immediately preceding the date upon which such rights, options or warrants
became exercisable. Common Shares owned by or held for the account of the
Company shall not be deemed outstanding for the purpose of any such
computation. Such adjustment to the Exercise Price 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 Exercise Price shall be adjusted to be the
Exercise Price that would then be in effect if such record date had not been
fixed.
(c) In the event that the Company shall, at any time after the Close
of Business on the Record Date and prior to the Close of Business on the
earlier of the Redemption Date or the Expiration Date, fix a record date for
the making of a distribution to all holders of the Common Shares (including any
such distribution made in connection with a consolidation or merger in which
the Company is the surviving corporation) of securities or assets (other than a
distribution of securities for which an adjustment is required under
Section 11(a)(i) or (b) hereof or a regular quarterly cash dividend), then the
Exercise Price to be in effect after such record date shall be determined by
multiplying the Exercise Price in effect immediately prior to such record date
by a fraction, the numerator of which shall be equal to the excess of the
Current Market Price per Common Share on such record date over and above the
fair market value of the portion of the securities or assets to be so
distributed with respect to one Common Share, and the denominator of which
shall be equal to such Current Market Price per Common Share. Such adjustments
shall be made successively whenever such a record date is fixed, and in the
event that such a distribution is not so made, the Exercise Price shall be
adjusted to be the Exercise Price that would then be in effect if such record
date had not been fixed.
(d) No adjustment in the Exercise Price shall be required unless
such adjustment would require an increase or decrease of at least 1% in the
Exercise Price; provided, however, that any adjustments that by reason of this
Section 11(d) are not required to be made shall be cumulated and taken into
account in any subsequent adjustment. All calculations under this Section 11
shall be made to the nearest cent or to the nearest one-thousandth of a Common
Share.
(e) If, as a result of an adjustment made pursuant to Section 11(a)
hereof, the holder of any Right thereafter exercised shall become entitled to
receive any securities of the Company other than Common Shares, the number of
such other securities so receivable upon exercise of any Right and the Exercise
Price thereof shall be subject to adjustment from time to time in a manner and
on terms as nearly equivalent as practicable to the provisions with respect to
Common Shares contained in this Section 11, and the other provisions of this
Agreement with respect to Common Shares shall apply on like terms to any such
other securities.
(f) All Rights originally issued by the Company subsequent to any
adjustment made to the Exercise Price hereunder shall represent the right to
purchase, at the adjusted Exercise Price, the Common Shares purchasable from
time to time hereunder upon exercise of the Rights, all subject to further
adjustment as provided herein.
(g) Unless the Company shall have exercised its election as provided
in Section 11(h) below, upon each adjustment of the Exercise Price as a result
of the calculations made in Sections 11(b) and (c) hereof, each Right
outstanding immediately prior to the making of such adjustment shall thereafter
represent the right to purchase, at the adjusted Exercise Price, that number of
Common Shares obtained by multiplying (i) the number of Common Shares
purchasable upon the exercise of one Right immediately prior to such adjustment
of the Exercise Price by (ii) the Exercise Price in effect immediately prior to
such adjustment, and dividing the product so obtained by the Exercise Price in
effect immediately after such adjustment.
(h) The Company may elect, on or after the date of any adjustment of
the Exercise Price, to adjust the number of Rights instead of making any
adjustment in the number of Common Shares 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 Common Shares for which a Right
was exercisable immediately prior to such adjustment. Each Right held of
record prior to such adjustment of the number of Rights shall become that
number of Rights obtained by dividing the Exercise Price in effect immediately
prior to the adjustment of the Exercise Price by the Exercise Price in effect
immediately after such adjustment of the Exercise Price. The Company shall
make a public announcement of its election to adjust the number of Rights
pursuant to this Section 11(h), indicating the record date for the adjustment
and, if known at the time, the amount of the adjustment to be made. Such
record date may be the date on which the Exercise Price is adjusted or any day
thereafter, but, if separate Right Certificates have been issued, it shall be
at least 10 days after the date of such public announcement. If separate Right
Certificates have been issued, upon each adjustment of the number of Rights
pursuant to this Section 11(h), the Company shall, as promptly as practicable,
cause to be distributed to holders of record of Right Certificates on such
record date Right Certificates representing, subject to Section 14 hereof, the
additional Rights to which such holders shall be entitled as a result of such
adjustment or, at the option of the Company, 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 such adjustment, and upon surrender
thereof if required by the Company, new Right Certificates representing all the
Rights to which such holders shall be entitled after such adjustment. Right
Certificates to be so distributed shall be issued, executed and countersigned
in the manner provided for herein (and may bear, at the option of the Company,
the adjusted Exercise 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.
(i) Irrespective of any adjustment or change in the Exercise Price
or the number of Common Shares issuable upon the exercise of one Right, the
Right Certificates theretofore and thereafter issued may continue to express
the Exercise Price per Common Share and the number of Common Shares issuable
upon the exercise of one Right that were expressed in the initial Right
Certificates issued hereunder.
(j) Before taking any action that would cause an adjustment reducing
the Exercise Price below the then par value, if any, of the Common Shares
issuable upon exercise of the Rights, the Company shall take any corporate
action that may, in the advice or opinion of its counsel, be necessary in order
that the Company may validly and legally issue fully paid and nonassessable
Common Shares at such adjusted Exercise Price.
(k) In any case in which this Section 11 shall require that an
adjustment in the Exercise Price be made effective as of a record date for a
specified event, the Company may elect to defer, until the occurrence of such
event, the issuance to the holder of any Right exercised after such record date
of the number of Common Shares and other capital stock or securities of the
Company, if any, issuable upon such exercise over and above the number of
Common Shares and other capital stock or securities of the Company, if any,
issuable upon such exercise on the basis of the Exercise Price in effect prior
to such adjustment; provided, however, that the Company shall deliver to such
holder a due bill or other appropriate instrument representing such holder's
right to receive such additional shares upon the occurrence of the event
requiring such adjustment.
(l) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such further adjustments in the number of
Common Shares that may be purchased upon exercise of one Right, and such
further adjustments in the Exercise 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 be advisable in order that any (i) consolidation
or subdivision of the Common Shares, (ii) issuance wholly for cash of any
Common Shares at less than the Current Market Price thereof, (iii) issuance
wholly for cash of Common Shares or securities that by their terms are
convertible into or exchangeable for Common Shares, (iv) dividends on Common
Shares payable in Common Shares or (v) issuance of rights, options or warrants
referred to Section 11(b) hereof, hereafter made by the Company to holders of
its Common Shares shall not be taxable to such stockholders.
Section 12. Certificate of Adjusted Exercise Price or Number of Shares
----------------------------------------------------------
Issuable Upon Exercise of Rights. Whenever an adjustment is made as provided
- --------------------------------
in Section 11 hereof, the Company shall promptly (a) prepare a certificate
setting forth such adjustment and a brief statement of the facts giving rise to
such adjustment, (b) file with the Rights Agent and with each transfer agent
for the securities issuable upon exercise of the Rights a copy of such
certificate and (c) mail a brief summary thereof to each holder of Rights in
accordance with Section 25 hereof. Notwithstanding the foregoing sentence, the
failure of the Company to make such certification or to give such notice shall
not affect the validity or the force and effect of such adjustment. Any
adjustment to be made pursuant to Sections 11 or 13 hereof shall be effective
as of the date of the event giving rise to such adjustment. The Rights Agent
shall be fully protected in relying on any such certificate and on any
adjustment therein contained and shall not be deemed to have knowledge of such
adjustment unless and until it shall have received such certificate.
Section 13. Consolidation, Merger, or Sale or Transfer of Assets or
-------------------------------------------------------
Earning Power.
- -------------
(a) In the event (a "Section 13(a) Event") that, at any time on or
after the 20% Ownership Date and prior to the earlier of the Redemption Date or
the Expiration Date, (1) the Company shall, directly or indirectly, consolidate
with or merge with and into any other Person and the Company shall not be the
continuing or surviving corporation in such consolidation or merger, (2) any
Person shall, directly or indirectly, consolidate with or merge with and into
the Company and the Company shall be the continuing or surviving corporation in
such consolidation or merger and, in connection with such consolidation or
merger, all or part of the Common Shares shall be changed into or exchanged for
stock or other securities of any Person or cash or any other property, or
(3) the Company and/or any one or more of its Subsidiaries shall, directly or
indirectly, sell or otherwise transfer, in one or more transactions (other than
transactions in the ordinary course of business), assets or earning power
aggregating more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any Person or Persons other than the Company
or one or more of its wholly owned Subsidiaries (such Persons, together with
the Persons described in clauses (1) and (2) above shall be collectively
referred to in this Section 13 as the "Surviving Person"), then, and in each
such case, proper provision shall be made so that:
(i) except as provided in Section 7(d) hereof, each holder of a
Right shall thereafter have the right to receive, upon the exercise
thereof in accordance with the terms of this Agreement and payment of the
then-current Exercise Price, in lieu of the securities or other property
otherwise purchasable upon such exercise, such number of validly
authorized and issued, fully paid and nonassessable Common Shares of the
Surviving Person as shall be equal to a fraction, the numerator of which
is the product of the then-current Exercise Price multiplied by the number
of Common Shares purchasable upon the exercise of one Right immediately
prior to the first Section 13(a) Event (or, if the Distribution Date shall
not have occurred prior to the date of such Section 13(a) Event, the
number of Common Shares that would have been so purchasable if the
Distribution Date had occurred on the Business Day immediately preceding
the date of such Section 13(a) Event, or, if a Section 11(a)(ii) Event has
occurred prior to such Section 13(a) Event, the product of the number of
Common Shares purchasable upon the exercise of a Right (or, if the
Distribution Date shall not have occurred prior to the date of such
Section 11(a)(ii) Event, the number of Common Shares that would have been
so purchasable if the Distribution Date had occurred on the Business Day
immediately preceding the date of such Section 11(a)(ii) Event)
immediately prior to such Section 11(a)(ii) Event, multiplied by the
Exercise Price in effect immediately prior to such Section 11(a)(ii)
Event), and the denominator of which is 50% of the Current Market Price
per Common Share of the Surviving Person on the date of consummation of
such Section 13(a) Event;
(ii) the Surviving Person shall thereafter be liable for and
shall assume, by virtue of such consolidation, merger, sale or transfer,
all the obligations and duties of the Company pursuant to this Agreement;
(iii) the term, "Company," shall thereafter be deemed to
refer to the Surviving Person; and
(iv) the Surviving Person shall take such steps (including, but
not limited to, the reservation of a sufficient number of its Common
Shares in accordance with Section 9 hereof) in connection with such
consummation as may be necessary to ensure that the provisions hereof
shall thereafter be applicable to its Common Shares thereafter deliverable
upon the exercise of Rights.
(b) Notwithstanding the foregoing, if the Section 13(a) Event is the
sale or transfer in one or more transactions of assets or earning power
aggregating more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole), but less than 100% thereof, then each Person
acquiring all or a portion thereof shall assume the obligations of the Company
as to a fraction of each of the Rights equal to the fraction of the assets of
the Company and its Subsidiaries (taken as a whole) acquired by such Person,
and the obligations of the Company as to the remaining fraction of each of the
Rights shall continue to be the obligations of the Company.
(c) The Company shall not consummate a Section 13(a) Event unless
prior thereto the Company and the Surviving Person shall have executed and
delivered to the Rights Agent a supplemental agreement confirming that such
Surviving Person shall, upon consummation of such Section 13(a) Event, assume
this Agreement in accordance with Section 13 hereof, that all rights of first
refusal or preemptive rights in respect of the issuance of Common Shares of
such Surviving Person upon exercise of outstanding Rights have been waived and
that such Section 13(a) Event shall not result in a default by such Surviving
Person under this Agreement, and further providing that, as soon as practicable
after the date of consummation of such Section 13(a) Event, such Surviving
Person shall:
(i) prepare and file a registration statement under the
Securities Act with respect to the Rights and the securities purchasable
upon exercise of the Rights on an appropriate form, use its best efforts
to cause such registration statement to become effective as soon as
practicable after such filing, use its best efforts to cause such
registration statement to remain effective (with a prospectus at all times
meeting the requirements of the Securities Act) until the Expiration Date,
and similarly comply with all applicable state securities laws;
(ii) use its best efforts to list (or continue the listing of)
the Rights and the Common Shares of the Surviving Person purchasable upon
exercise of the Rights on a national securities exchange, or use its best
efforts to cause the Rights and such Common Shares to meet the eligibility
requirements for quotation on NASDAQ; and
(iii) deliver to holders of the Rights historical financial
statements for such Surviving Person that comply in all respects with the
requirements for registration on Form 10 (or any successor form) under the
Exchange Act.
(d) In the event that at any time after the occurrence of a
Section 11(a)(ii) Event some or all of the Rights shall not have been exercised
pursuant to Section 11 hereof prior to the date of a Section 13(a) Event, such
Rights shall thereafter be exercisable only in the manner described in
Section 13(a) hereof. In the event that a Section 11(a)(ii) Event occurs on or
after the date of a Section 13(a) Event, Rights shall not be exercisable
pursuant to Section 11 hereof but shall instead be exercisable pursuant to, and
only pursuant to, this Section 13.
(e) The provisions of this Section 13 shall apply to each successive
merger, consolidation, sale or other transfer constituting a Section 13(a)
Event.
Section 14. Fractional Rights and Fractional Shares.
---------------------------------------
(a) The Company shall not be required to issue fractions of Rights
or to distribute Right Certificates that represent fractional Rights. If the
Company shall determine not to issue such fractional Rights, the Company shall
pay to the registered holders of the Right Certificates with respect to which
such fractional Rights would otherwise be issuable, at the time such fractional
Rights would otherwise have been issued as provided herein, an amount in cash
equal to the same fraction of the Current Market Price of a whole Right on the
Business Day immediately prior to the date upon which such fractional Rights
would otherwise have been issuable.
(b) The Company shall not be required to issue fractions of Common
Shares or other capital stock upon exercise of Rights, or to distribute
certificates that represent fractional Common Shares or other capital stock.
If the Company shall determine not to issue fractional Common Shares or other
capital stock, the Company shall pay to the registered holders of Right
Certificates with respect to which such fractional Common Shares or other
capital stock would otherwise be issuable, at the time such Rights are
exercised as provided herein, an amount in cash equal to the same fraction of
the Current Market Price of a whole Common Share or other share of such capital
stock, as the case may be. For purposes of this Section 14(b), the Current
Market Price of a whole Common Share shall be the Closing Price per share for
the Trading Day immediately prior to the date of such exercise.
(c) The holder of a Right, by the acceptance of such Right,
expressly waives such holder's right to receive any fractional Rights or any
fractional Common Shares or other capital stock upon exercise of such Right,
except as permitted by this Section 14.
Section 15. Rights of Action. All rights of action in respect of this
----------------
Agreement, except the rights of action given to the Rights Agent under Section
18 hereof, are vested in the respective registered holders of the Right
Certificates and certificates for Common Shares representing Rights, and any
registered holder of any Right Certificate or of such certificate for Common
Shares, without the consent of the Rights Agent or of the holder of any other
Right Certificate or any other certificate for Common Shares may, in such
holder's own behalf and for such holder's own benefit, enforce, and may
institute and maintain any suit, action or proceeding against the Company to
enforce, or otherwise act in respect of, such holder's right to exercise the
Rights represented by such Right Certificate or by such certificate for Common
Shares in the manner provided in such Certificate and in this Agreement.
Without limiting the foregoing or any remedies available to the holders of
Rights, it is specifically acknowledged that the holders of Rights would not
have an adequate remedy at law for any breach of this Agreement and shall be
entitled to specific performance, and injunctive relief against actual or
threatened violations, of the obligations of any Person under this Agreement.
Section 16. Agreement of Right Holders. Every holder of a Right, by
--------------------------
accepting the same, consents and agrees with the Company and the Rights Agent
and every other holder of a Right that:
(a) prior to the Distribution Date, the Rights shall be represented
by certificates for Common Shares registered in the name of the holders of such
Common Shares (which certificates for Common Shares shall also constitute Right
Certificates), and each such Right shall be transferable only in connection
with the transfer of such Common Shares;
(b) after the Distribution Date, the Right Certificates shall only
be transferable on the registry books of the Rights Agent if surrendered at the
principal stock transfer office of the Rights Agent, duly endorsed or
accompanied by a proper instrument of transfer along with a signature guarantee
and such other and further documentation as the Rights Agent may reasonably
request;
(c) the Company and the Rights Agent may deem and treat the person
in whose name the Right Certificate is registered as the absolute owner thereof
and of the Rights represented thereby (notwithstanding any notations of
ownership or writing on the Right Certificate 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; and
(d) notwithstanding anything in this Agreement to the contrary,
neither the Company nor the Rights Agent shall have any liability to any holder
of a Right or other Person as a result of its inability to perform any of its
obligations under this Agreement by reason of any preliminary or permanent
injunction or other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative agency or
commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority prohibiting or otherwise restraining
performance of such obligation.
Section 17. Right Holder and Right Certificate Holder Not Deemed a
------------------------------------------------------
Stockholder. No holder, as such, of any Right or Right Certificate
- -----------
shall be entitled to vote, receive dividends or be deemed for any purpose
the holder of the securities of the Company that may at any time be issuable
upon the exercise of the Rights represented thereby, nor shall anything
contained herein or in any Right Certificate be construed to confer upon the
holder of any Right or 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, to give or
withhold consent to any corporate action, to receive notice of meetings or
other actions affecting stockholders (except as provided in Section 25 hereof),
or to receive dividends or subscription rights, or otherwise, in each case
until such Right or the Rights represented by such Right Certificate shall have
been exercised in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent.
---------------------------
(a) The Company agrees to pay to the Rights Agent reasonable
compensation for all services rendered by it hereunder and, from time to time,
on demand of the Rights Agent, its reasonable expenses and counsel fees and
disbursements and other disbursements incurred in the administration and
execution of this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent for, and to
hold it harmless against, any loss, liability, or expense, incurred without
negligence, bad faith or willful misconduct on the part of the Rights Agent,
for anything done or omitted by the Rights Agent in connection with the
acceptance and administration of this Agreement, including the costs and
expenses of defending against any claim of liability in the premises.
Notwithstanding anything in this Agreement to the contrary, in no event shall
the Rights Agent be liable for special, indirect or consequential loss or
damage of any kind whatsoever, even if the Rights Agent has been advised of
the likelihood of such loss or damage and regardless of the form of action.
(b) The Rights Agent shall be protected and shall incur no liability
for or in respect of any action taken, suffered or omitted by it in connection
with its administration of this Agreement in reliance upon any Rights
Certificate or certificate for a Common Share 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 ordocument believed by it to be genuine and to be signed, executed and,
where necessary, verified or acknowledged, by the proper Person or Persons.
Section 19. Merger or Consolidation or Change of Name of Rights Agent.
---------------------------------------------------------
(a) Any corporation into which the Rights Agent or any successor
Rights Agent may be merged or with which it may be consolidated, or any
corporation resulting from any merger or consolidation to which the Rights
Agent or any successor Rights Agent shall be a party, or any corporation
succeeding to the corporate trust or stock transfer business of the Rights
Agent or any successor Rights Agent, shall be the successor to the Rights
Agent under this Agreement without the execution or filing of any paper or any
further act on the part of any of the parties hereto; provided, however, that
such corporation would be eligible for appointment as a successor Rights Agent
under the provisions of Section 21 hereof. In case at the time such successor
Rights Agent shall succeed to the agency created by this Agreement, any of the
Rights Certificates shall have been countersigned but not delivered, any such
successor Rights Agent may adopt the countersignature of a predecessor Rights
Agent and deliver such Rights Certificates so countersigned; and in case at
that time any of the Rights Certificates shall not have been countersigned,
any successor Rights Agent may countersign such Rights Certificates either in
the name of the predecessor or in the name of the successor Rights Agent; and
in all such cases such Rights Certificates shall have the full force provided
in the Rights Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent shall be
changed and at such time any of the Rights Certificates shall have been
countersigned but not delivered, the Rights Agent may adopt the counter-
signature under its prior name and deliver Rights Certificates so
countersigned; and in case at that time any of the Rights Certificates shall
not have been countersigned, the Rights Agent may countersign such Rights
Certificates either in its prior name or in its changed name; and in all such
cases such Rights Certificates shall have the full force provided in the Rights
Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes the
----------------------
duties and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the holders of Rights Certificates,
by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may be
legal counsel for the Company), and the opinion of such counsel shall be full
and complete authorization and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement
the Rights Agent shall deem it necessary or desirable that any fact or matter
(including without limitation, the identity of any 20% Shareholder and the
determination of Current Market Price) be proved or established by the Company
prior to taking or suffering any action hereunder, such fact or matter (unless
other evidence in respect thereof be herein specifically prescribed) may be
deemed to be conclusively proved and established by a certificate signed by the
Chairman of the Board, the President, any Vice President, the Treasurer, any
Assistant Treasurer, 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 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 the
statements of fact or recitals contained in this Agreement or in the Rights
Certificates or be required to verify the same (except as to its
countersignature on such Rights Certificates), but all such statements and
recitals are and shall be deemed to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the
validity or execution of any Rights Certificate (except its countersignature
thereof); nor shall it be responsible for any adjustment required under the
provisions of Sections 7, 11, 13 or Section 23 hereof or responsible for the
manner, method or amount of any such adjustment or the ascertaining of the
existence of facts that would require any such adjustment (except with respect
to the exercise of Rights evidenced by Rights Certificates after receipt of the
certificate described in Section 12 hereof setting forth 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 Agreement or any Rights Certificates or as to
whether any Common Shares will, when so issued, be validly authorized and
issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge
and deliver or cause to be performed, executed, acknowledged and delivered all
such further and other acts, instruments and assurances as may reasonably be
required by the Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from the
Chairman of the Board, the President, any Vice President, the Secretary, any
Assistant Secretary, the Treasurer or any Assistant Treasurer of the Company,
and to apply to such officers for advice or instructions in connection with its
duties, and it shall not be liable for any action taken or suffered to be taken
by it in good faith in accordance with instructions of any such officer.
(h) The Rights Agent and any stockholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend
money to the Company or otherwise act as fully and freely as though it were not
Rights Agent under this Agreement. Nothing herein shall preclude the Rights
Agent from acting in any other capacity for the Company or for any other legal
entity.
(i) The Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself or by or
through its attoneys or agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any such attorneys
or agents or for any loss to the Company resulting from any such act, default,
neglect or misconduct; provided, however, reasonable care was exercised in the
selection and continued employment thereof.
(j) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if
there shall be reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not reasonably
assured to it.
(k) If, with respect to any Rights Certificate surrendered to the
Rights Agent for exercise or transfer, the certificate attached to the form of
assignment or form of election to purchase as the case may be, has not been
completed, the Rights Agent shall not take any further action with respect to
such requested exercise of transfer without first consulting with the Company.
Section 21. Change of Rights Agent. The Rights Agent or any successor
----------------------
Rights Agent may resign and be discharged from its duties under this Agreement
upon thirty (30) days' notice in writing mailed to the Company, and to each
transfer agent of the Common Shares and Common Shares by registered or
certified mail, and to the holders of the Rights Certificates by first-class
mail. The Company may remove the Rights Agent or any successor Rights Agent
(with or without cause) upon thirty (30) days' notice in writing, mailed to the
Rights Agent or successor Rights Agent, as the case may be, and to each
transfer agent of the Common Shares and Common Shares, by registered or
certified mail, and to the holders of the Rights Certificates by first-class
mail. If the Rights Agent shall resign or be removed or shall otherwise become
incapable of acting, the Company shall appoint a successor to the Rights Agent.
If the Company shall fail to make such appointment within a period of
thirty (30) days after giving notice of such removal or after it has been
notified in writing of such resignation or incapacity by the resigning or
incapacitated Rights Agent or by the holder of a Rights Certificate (who shall,
with such notice, submit his Rights Certificate for inspection by the Company),
then the incumbent Rights Agent or any registered holder of any Rights
Certificate may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor Rights Agent, whether
appointed by the Company or by such a court, shall be (a) a corporation
organized and doing business under the laws of the United States or of any
other state of the United States in good standing, which is authorized under
such laws to exercise corporate trust or stock transfer powers or (b) an
affiliate of a corporation described in clause (a) of this sentence. After
appointment, the successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named as
Rights Agent without further act or deed; but the predecessor Rights Agent
shall deliver and transfer to the successor Rights Agent any property at the
time held by it hereunder, and 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 Shares, and a mail a notice thereof in writing to the registered
holders of the Rights Certificates. Failure to give any notice provided for in
this Section 21, however, or any defect therein, shall not affect the legality
or validity of the resignation or removal of the Rights Agent or the
appointment of the successor Rights Agent, as the case may be.
Section 22. Issuance of New Right Certificates. Notwithstanding any of
----------------------------------
the provisions of this Agreement or of the Right Certificates to the contrary,
the Company may, at its option (subject to Section 4 hereof), issue new Right
Certificates in such form as may be approved by the Board of Directors in order
to reflect any adjustment or change in the Exercise Price and the number or
kind or class of shares or other securities or property purchasable upon
exercise of the Rights in accordance with the provisions of this Agreement.
Section 23. Redemption of Rights.
--------------------
(a) Until the earlier of (i) the Distribution Date or (ii) the
Expiration Date, the Board of Directors of the Company may, at its option,
authorize and direct the redemption of all, but not less than all, of the then
outstanding Rights at a redemption price of $.01 per Right, as such redemption
price shall be appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof (the
"Redemption Price"), and the Company shall so redeem the Rights; provided,
however, that from and after the date of the first Section 11(a)(ii) Event, the
Rights shall not be redeemable.
(b) Immediately upon the action of the Board of Directors of the
Company authorizing and directing the redemption of the Rights pursuant to
subsection (a) of this Section 23, or at such time and date thereafter as it
may specify, and without any further action and without any notice, the right
to exercise Rights shall terminate and the only right thereafter of the holders
of Rights shall be to receive the Redemption Price. Within 10 Business Days
after the date of such action, the Company shall give notice of such redemption
to the holders of Rights by mailing such notice to all holders of Rights at
their last addresses as they appear upon the registry books of the Rights Agent
or, if prior to the Distribution Date, on the registry books of the transfer
agent for the Common Shares. Any notice that is mailed in the manner herein
provided shall be deemed given, whether or not the holder receives such notice,
but neither the failure to give any such notice nor any defect therein shall
affect the legality or validity of such redemption. Each such notice of
redemption shall state the method by which the payment of the Redemption Price
will be made. Neither the Company nor any of its Affiliates or Associates may,
directly or indirectly, redeem, acquire or purchase for value any Rights in any
manner other than that specifically set forth in Section 24 hereof or in this
Section 23, and other than in connection with the purchase of Common Shares
prior to the date of the first Section 11(a)(ii) Event.
(c) The Company may, at its option, pay the Redemption Price in
cash, Common Shares, other equity securities of the Company, debt securities of
the Company, other property or any combination of the foregoing, in each case
having an aggregate Current Market Price on the Redemption Date equal to the
Redemption Price.
Section 24. Exchange of Rights.
------------------
(a) At any time after the 20% Ownership Date and prior to the first
date thereafter upon which a 20% Stockholder, together with all Affiliates and
Associates of such 20% Stockholder, shall be the Beneficial Owner of 50% or
more of the Voting Shares then outstanding, the Board of Directors of the
Company may, at its option, authorize and direct the exchange of all, but not
less than all, of the then outstanding Rights for Common Shares or for units of
cash, other debt or equity securities of the Company, other property, or any
combination of the foregoing, (the "Exchange Consideration") having a Current
Market Price equal to the difference between the Exercise Price and the Current
Market Price of the Common Shares that each holder of a Right would otherwise
have the right to receive upon the exercise of a Right on such date.
(b) Immediately upon the action of the Board of Directors of the
Company authorizing and directing the exchange of the Rights pursuant to
subsection (a) of this Section 24, or at such time and date thereafter as it
may specify, and without any further action and without any notice, the right
to exercise Rights shall terminate and the only right thereafter of the holders
of Rights shall be to receive the Exchange Consideration. Within 10 Business
Days after the date of such action, the Company shall give notice of such
exchange to the holders of Rights by mailing such notice to all holders of
Rights at their last addresses as they appear upon the registry books of the
Rights Agent or, if prior to the Distribution Date, on the registry books of
the transfer agent for the Common Shares. Any notice that is mailed in the
manner herein provided shall be deemed given, whether or not the holder
receives such notice, but neither the failure to give any such notice nor any
defect therein shall affect the legality or validity of such exchange. Each
such notice of exchange shall state the method by which the Rights will be
exchanged for Common Shares. Neither the Company nor any of its Affiliates or
Associates may, directly or indirectly, redeem, acquire or purchase for value
any Rights in any manner other than (i) as specifically set forth in Section 23
hereof, (ii) as specifically set forth in this Section 24 or (iii) in
connection with the purchase of Common Shares prior to the first Section
11(a)(ii) Event.
(c) In any exchange pursuant to this Section 24, the Company, at its
option, may substitute (i) cash, (ii) other equity securities of the Company,
(iii) debt securities of the Company, (iv) other property or (v) any
combination of the foregoing for the Common Shares exchangeable for Rights, as
appropriately adjusted. Subject to Section 7(d) hereof, in the event that the
Company takes any action pursuant to this Section 24, such action shall apply
uniformly to all outstanding Rights.
Section 25. Notice of Certain Events.
------------------------
(a) In the event that the Company shall propose (i) to declare or
pay any dividend payable on or make any distribution with respect to its Common
Shares (other than a regular quarterly cash dividend), (ii) to offer to the
holders of its Common Shares options, rights or warrants to subscribe for or to
purchase any additional shares thereof or shares of stock of any class or any
other securities, rights or options, (iii) to effect any reclassification of
its Common Shares (other than a reclassification involving only the subdivision
of outstanding shares), (iv) to effect any consolidation or merger with or
into, or to effect any sale or other transfer (or to permit one or more of its
Subsidiaries to effect any sale or other transfer), in one or more trans-
actions, of more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to, any other Person or Persons, or (v) to
effect the liquidation, dissolution or winding up of the Company, then and in
each such case, the Company shall give to each holder of a Right Certificate
and to the Rights Agent, in accordance with Section 26 hereof, a notice of such
proposed action, that shall specify the record date for the purpose of such
dividend or distribution, or the date upon which such reclassification,
consolidation, merger, sale, transfer, liquidation, dissolution or winding up
is to take place and the date of participation therein by the holders of record
of the Common Shares, if any such date is to be fixed, and such notice shall be
so given in the case of any action covered by clause (i) or (ii) above at least
20 days prior to the record date for determining holders of the Common Shares
for purposes of such action, and in the case of any such other action, at least
20 days prior to the date of the taking of such proposed action or the date of
participation therein by the holders of the Common Shares, whichever date shall
be the earlier. The failure to give the notice required by this Section 25 or
any defect therein shall not affect the legality or validity of the action
taken by the Company or the vote upon any such action.
(b) Upon the occurrence of each Section 11(a)(ii) Event and each
Section 13(a) Event, the Company shall as soon as practicable thereafter give
to each holder of a Right Certificate and to the Rights Agent, in accordance
with Section 26 hereof, a notice of the occurrence of such event, specifying
the event and the consequences of the event to holders of Rights under
Sections 11 and 13 hereof, as the case may be.
Section 26. Notices. Notices or demands authorized by this Agreement to
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be given or made by the Rights Agent or by the holder of any Right Certificate
to or on the Company shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed (until another address is filed in writing
with the Rights Agent) as follows:
Alexander & Baldwin, Inc.
822 Bishop Street
Honolulu, Hawaii 96813
Attention: Secretary
Subject to the provisions of Section 21 hereof, any notice or demand
authorized by this Agreement to be given or made by the Company or by the
holder of any Right Certificate to or on the Rights Agent shall be sufficiently
given or made if sent by first-class mail, postage prepaid, addressed (until
another address is filed in writing with the Company) to the principal stock
transfer office of the Rights Agent as follows:
ChaseMellon Shareholder Services, L.L.C.
235 Montgomery Street
23rd Floor
San Francisco, California 94104
Attention: Department Manager
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class mail, postage prepaid,
addressed to such holder at the address of such holder as shown on the registry
books of the Company or the transfer agent.
Section 27. Supplements and Amendments.
--------------------------
(a) The Board of Directors of the Company may, from time to time,
before and after the Distribution Date, without the approval of any holders of
Rights, supplement or amend any provision of this Agreement in any manner,
whether or not such supplement or amendment is adverse to any holder of Rights,
and direct the Rights Agent so to supplement or amend such provision, and the
Rights Agent shall so supplement or amend such provision; provided, however,
that from and after the earliest of (i) the date of the first Section 11(a)(ii)
Event, (ii) the Redemption Date or (iii) the Expiration Date, this Agreement
shall not be supplemented or amended in any manner that would materially and
adversely affect any holder of outstanding Rights other than a 20% Stockholder
or a Surviving Person.
(b) Upon the delivery of a certificate from an appropriate officer
of the Company which states that the proposed supplement or amendment is in
compliance with the terms of this section, the Rights Agent shall execute such
supplement or amendment. Notwithstanding any other provision hereof, the
Rights Agent's consent must be obtained regarding any amendment or supplement
pursuant to this Section 27 which alters the Rights Agent's rights or duties.
Section 28. Certain Covenants. Subject to Section 27 hereof and the
-----------------
other provisions of this Agreement, from and after the earlier of the date of
the first Section 11(a)(ii) Event and prior to the earlier of the Redemption
Date or the Expiration Date, the Company shall not (a) issue or sell, or permit
any Subsidiary to issue or sell, to a 20% Stockholder or a Surviving Person, or
any Affiliate or Associate of a 20% Stockholder or a Surviving Person, or any
Person holding Voting Shares of the Company that are Beneficially Owned by a
20% Stockholder or a Surviving Person, (i) any rights, options, warrants or
convertible securities on terms similar to, or that materially adversely affect
the value of, the Rights or (ii) Common Shares or shares of any other class of
capital stock, if such sale is intended to or would materially adversely affect
the value of the Rights, or (b) take any other action that is intended to or
would materially adversely affect the value of the Rights.
Section 29. Successors. All the covenants and provisions of this
----------
Agreement by or for the benefit of the Company or the Rights Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder.
Section 30. Benefits of this Agreement. Nothing in this Agreement shall
--------------------------
be construed to give to any Person other than the Company, the Rights Agent,
the registered holders of the Right Certificates (other than those representing
Rights that have become null and void) and the certificates for Common Shares
representing Rights (other than those Rights that have become null and void)
any legal or equitable right, remedy or claim under this Agreement, and this
Agreement shall be for the sole and exclusive benefit of the Company, the
Rights Agent, such registered holders of Right Certificates and such
certificates for Common Shares representing Rights.
Section 31. Severability. If any term, provision, covenant or
------------
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain
in full force and effect and shall in no way be affected, impaired or
invalidated.
Section 32. Governing Law. This Agreement and each Right Certificate
-------------
issued hereunder shall be deemed to be a contract made under the laws of the
State of Hawaii and for all purposes shall be governed by and construed in
accordance with the laws of such state applicable to contracts made and
performed entirely within such state.
Section 33. Counterparts. This Agreement may be executed in any number
------------
of counterparts and each such counterpart shall for all purposes be deemed to
be an original and all such counterparts shall together constitute but one and
the same instrument.
Section 34. Descriptive Headings. Descriptive headings of the several
--------------------
sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
ALEXANDER & BALDWIN, INC.
By: /s/ John C. Couch
--------------------------------
Name: John C. Couch
Title: Chairman of the Board, President and
Chief Executive Officer
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.,
as Rights Agent
By: /s/ Daniel W. Spengel
------------------------------
Name: Daniel W. Spengel
Title: Assistant Vice President
EXHIBIT A
FORM OF
RIGHT CERTIFICATE
Certificate No. R-___________ Rights
NOT EXERCISABLE AFTER____________________, OR EARLIER IF REDEEMED
OR EXCHANGED. THE RIGHTS ARE SUBJECT TO EARLIER EXPIRATION,
REDEMPTION AND EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT. UNDER CERTAIN CIRCUMSTANCES SPECIFIED IN THE RIGHTS
AGREEMENT, RIGHTS BENEFICIALLY OWNED BY CERTAIN PERSONS OR ANY
SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL AND VOID.
Right Certificate
ALEXANDER & BALDWIN, 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 and conditions of a Rights
Agreement (the "Rights Agreement") dated as of June 25, 1998 by and between
Alexander & Baldwin, Inc., a Hawaii corporation (the "Company"), and
ChaseMellon Shareholder Services, L.L.C. (the "Rights Agent"), to purchase from
the Company at any time prior to the earlier of the Redemption Date (as such
term is defined in the Rights Agreement) or 5:00 o'clock p.m., Hawaii time,
on _________________, , at the office or agency of the Rights Agent at
Ridgefield Park, New Jersey, or at the office of its successor as Rights Agent,
one fully paid and nonassessable share of Common Stock, without par value, of
the Company (a "Common Share") or, in certain circumstances, other securities
or other property, at a purchase price of $___ (_______________________Dollars)
per Common Share (the "Exercise Price"), upon presentation and surrender of
this Right Certificate with the Form of Election to Purchase, including
Certificate, on the reverse side hereof completed and duly executed, with
signature guaranteed.
The number of Rights represented by this Right Certificate and the
Exercise Price set forth above are the number of Rights and the Exercise Price
as of ___________________, , based upon the Common Shares as constituted on
such date. As provided in the Rights Agreement, the Exercise Price and the
number of Common Shares or other securities or other property that may be
purchased upon the exercise of the Rights represented by this Right Certificate
are subject to modification and adjustment upon the occurrence of certain
events.
The Rights Agreement contains a full description of the rights,
limitations of rights, obligations, duties and immunities of the Rights Agent,
the Company and the holders of Right Certificates. This Right Certificate is
subject to all the terms and conditions of the Rights Agreement, which terms
and conditions are hereby incorporated herein by reference and made a part
hereof. Copies of the Rights Agreement are on file at the principal executive
offices of the Company and the above-mentioned offices of the Rights Agent.
This Right Certificate, with or without other Right Certificates, upon
presentation and surrender at the above-mentioned offices of the Rights Agent,
with the Form of Assignment, including Certificate, on the reverse side hereof
completed and duly executed, with signature guaranteed, may be exchanged for
another Right Certificate or Right Certificates of like tenor and date
representing Rights entitling the holder thereof to purchase a like aggregate
number of Common Shares or, in certain circumstances, other securities or other
property, as the Rights represented by the Right Certificate or Right
Certificates surrendered shall have entitled such holder to purchase. If this
Right Certificate shall be exercised in part, the holder shall be entitled to
receive, upon the surrender hereof with the Form of Election to Purchase,
including Certificate, on the reverse side hereof completed and duly executed,
with signature guaranteed, another Right Certificate or Right Certificates for
the number of whole Rights not exercised. Subject to the provisions of the
Rights Agreement, the Rights represented by this Right Certificate may be
redeemed by the Company, at its option, at a redemption price of $.01 per Right
or, upon the occurrence of certain events, the Company, at its option, may
exchange such Rights for fully paid and nonassessable shares of Common Stock,
without par value, of the Company or for units of cash, other debt or equity
securities of the Company, other property or any combination of the foregoing,
having a Current Market Price (as defined in the Rights Agreement) equal to the
difference between the Exercise Price and the Current Market Price of the
Common Shares which each holder of a Right would have a right to receive upon
the exercise of a Right on such date.
No fractional securities shall be issued upon the exercise of any Right or
Rights represented hereby, but in lieu thereof, a cash payment shall be made,
as provided in the Rights Agreement.
No holder of this Right Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Common Shares
or other securities of the Company that may at any time be issuable on the
exercise hereof, nor shall anything contained herein be construed to confer
upon the 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, until the Right or Rights
represented by this Right Certificate shall have been exercised as provided in
the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal. Dated as of _______________________, ____.
Attest: ALEXANDER & BALDWIN, INC.
By_____________________________ By______________________________
Name: Name:
Title: Title:
Countersigned:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
By_____________________________ By_______________________________
Name: Name:
Title: Title:
Form of Reverse Side or Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to
transfer any or all of the Rights represented by this Right Certificate)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto __________________________________________________________________________
_______________________________________________________________________________
(Name, address and social security or other
identifying number of transferee)
___________________________________________ (_____________) of the Rights
represented by this Right Certificate, together with all right, title and
interest in and to said Rights, and hereby irrevocably constitutes and appoints
__________________ attorney to transfer said Rights on the books of
Alexander & Baldwin, Inc. with full power of substitution.
Dated:________________, ____ ______________________________
(Signature)
Signature Guaranteed:
Certificate
(to be completed, if true)
The undersigned hereby certifies that the Rights represented by this Right
Certificate are not Beneficially Owned by a 20% Stockholder or an Affiliate or
Associate of a 20% Stockholder (as such capitalized terms are defined in the
Rights Agreement).
Dated:________________, ____ ______________________________
(Signature)
Signature Guaranteed:
Form of Reverse Side of Right Certificate
(continued)
NOTICE
The signatures to the foregoing Assignment and the foregoing Certificate,
if applicable, 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, and must be guaranteed by a member 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 of America.
In the event that the foregoing Certificate is not duly executed, with
signature guaranteed, the Company may deem the Rights represented by this Right
Certificate to be Beneficially Owned by a 20% Stockholder or an Affiliate or
Associate of a 20% Stockholder (as such capitalized terms are defined in the
Rights Agreement), and not issue any Right Certificate or Right Certificates in
exchange for this Right Certificate.
Form of Reverse Side of Right Certificate
(continued)
FORM OF ELECTION TO PURCHASE
(To be executed by the registered holder if such holder desires to
exercise any or all of the Rights represented by this Right Certificate)
To Alexander & Baldwin, Inc.:
The undersigned hereby irrevocably elects to exercise
_________________________ (_____________) of the Rights represented by this
Right Certificate to purchase the following:
(Check one of the following boxes)
[ ] the Common Shares or other securities or property issuable upon
the exercise of said number of Rights pursuant to Section 7(b)
of the Rights Agreement.
[ ] the Common Shares of the Company, or other securities or
property issuable upon the exercise of said number of Rights
pursuant to Section 11(a)(ii) of the Rights Agreement.
[ ] the securities issuable upon the exercise of said number of
Rights pursuant to Section 13(a) of the Rights Agreement.
The undersigned hereby requests that any such property and a certificate
for any such securities be issued in the name of and delivered to:
__________________________________________________________________________
(Name, address and social security or other
identifying number of issuee)
The undersigned hereby further requests that if said number of Rights
shall not be all the Rights represented by this Right Certificate, a new Right
Certificate for the remaining balance of such Rights be issued in the name of
and delivered to:
__________________________________________________________________________
(Name, address and social security or other
identifying number of issuee)
Dated:________________, ____ __________________________
(Signature)
Signature Guaranteed:
Form of Reverse Side of Right Certificate
(continued)
Certificate
(to be completed, if true)
The undersigned hereby certifies that the Rights represented by this Right
Certificate are not Beneficially Owned by a 20% Stockholder or an Affiliate or
Associate of a 20% Stockholder (as such capitalized terms are defined in the
Rights Agreement).
Dated:________________, ____ __________________________
(Signature)
Signature Guaranteed:
NOTICE
The signatures to the foregoing Assignment and the foregoing Certificate,
if applicable, 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, and must be guaranteed by a member 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.
In the event that the foregoing Certificate is not duly executed, with
signature guaranteed, the Company may deem the Rights represented by this Right
Certificate to be Beneficially Owned by a 20% Stockholder or an Affiliate or
Associate of a 20% Stockholder (as such capitalized terms are defined in the
Rights Agreement), and not issue any property or certificate for securities
upon the exercise of this Right Certificate or issue any new Right Certificate
for any remaining balance of unexercised Rights represented by this Right
Certificate.