Exhibit 4.1
TAX BENEFIT PRESERVATION PLAN
Dated as of March 3, 2020 by
and between
AVIAT NETWORKS, INC.
and
COMPUTERSHARE INC.,
as Rights Agent
| | Page |
| Section1. CertainDefinitions | 2 |
| Section2. Appointment ofRights Agent | 9 |
| Section3.IssuanceofRights Certificates | 10 |
| Section4.FormofRights Certificates | 12 |
| Section5.Countersignature and Registration | 12 |
Section6. Transfer,Split Up,CombinationandExchange ofRights Certificates;Mutilated, Destroyed, Lostor
StolenRights Certificates | 13 |
| Section7. Exerciseof Rights; Exercise Price;Expiration DateofRights | 14 |
| Section8. CancellationandDestructionofRights Certificates | 17 |
| Section9.Reservation and Availabilityof Preferred Shares | 17 |
| Section10.Record Date for Securities Issued | 18 |
| Section11. Adjustmentof Exercise Price, NumberandKindof Sharesor NumberofRights | 19 |
| Section12. Certificateof Adjusted Exercise Priceor Numberof Shares | 25 |
| Section13. Consolidation, Mergeror Saleor Transferof Assets, Cash Flowor Earning Power | 26 |
| Section14.FractionalRightsand Fractional Shares | 29 |
| Section15. Rightsof Action | 30 |
| Section16.AgreementofRights Holders | 30 |
| Section17.HolderofRights Certificate Not Deemed tobe aStockholder | 31 |
| Section18.Concerning theRights Agent | 31 |
| Section19. Merger,Consolidation orChangeof NameofRights Agent | 32 |
| Section20.DutiesofRights Agent | 32 |
| Section21. ChangeofRights Agent | 35 |
| Section22. Issuanceof NewRights Certificates | 36 |
| Section23.Redemption | 36 |
| Section24.Exchange | 37 |
| Section25.Process to SeekExemptionPrior to TriggerEvent | 40 |
| Section26.Noticeof CertainEvents | 42 |
| Section27. Notices | 43 |
| Section28.Supplements andAmendments | 44 |
| Section29. Successors | 44 |
| Section30.Determinationsand Actionsby the Board | 44 |
| Section31.Benefitsof this Plan | 44 |
| Section32.Severability | 45 |
| Section33.GoverningLaw;ExclusiveJurisdiction | 45 |
| Section34.Counterparts | 45 |
| Section35.DescriptiveHeadings; Interpretation | 46 |
| Section36.Costsof Enforcement | 46 |
| Section37. Force Majeure | 46 |
| Section38.USA PATRIOT Act | 47 |
| | Page |
| EXHIBITS | |
| | |
Exhibit A Form of Certificate of Designation of Rights, Preferences and Privileges of Series A Participating
Preferred Stock | A-1 |
| Exhibit B Form of Rights Certificate | B-1 |
| Exhibit C Form of Summary of Rights | C-1 |
TAX BENEFIT PRESERVATION PLAN
This TAX BENEFIT PRESERVATION PLAN (this “Plan”), dated as of March 3, 2020, is by and between Aviat Networks, Inc., a Delaware corporation (the “Company”), and Computershare Inc., a Delaware corporation, as rights agent (the “Rights Agent”). All capitalized terms used in this Plan have the meanings given thereto in Section 1.
RECITALS
WHEREAS, on March 3, 2020 (the “Rights Dividend Declaration Date”), the Board of Directors of the Company (the “Board”) adopted this Plan and authorized and declared a dividend of one preferred share purchase right (a “Right”) for each Common Share outstanding as of the Close of Business on March 13, 2020 (the “Record Date”), each Right initially representing the right to purchase one one-thousandth of a Preferred Share (as such number may be adjusted pursuant to the provisions of this Plan) and having the rights, preferences and privileges set forth in the form of Certificate of Designation of Rights, Preferences and Privileges of Series A Participating Preferred Stock attached hereto as Exhibit A, upon the terms and subject to the conditions set forth herein;
WHEREAS, the Board further authorized and directed the issuance of one Right (as such number may be adjusted pursuant to the provisions of this Plan) with respect to each Common Share that becomes outstanding (whether as an original issuance or from the Company’s treasury) between the Record Date and the earlier of the (a) Distribution Date and (b) Expiration Date, and in certain circumstances after the Distribution Date;
WHEREAS, if the Company experiences an “ownership change,” as defined in Section 382 of the Internal Revenue Code of 1986, as amended, or any successor statute (the “Code”), its ability to use Tax Benefits (as defined below) for income tax purposes could be substantially limited or lost altogether; and
WHEREAS, the Company views the Tax Benefits as highly valuable assets of the Company that are likely to inure to the benefit of the Company and its stockholders, and the Company believes that it is in the best interests of the Company and its stockholders that the Company provide for the protection of the Tax Benefits on the terms and conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the premises and the mutual agreements herein set forth, the parties hereby agree as follows:
Section 1.Certain Definitions. For purposes of this Plan, the following terms have the meanings indicated:
(a) “Acquiring Person” meansany Person whoor that, together withall Affiliatesand Associatesof such Person, istheBeneficial Ownerof 4.9%ormoreof theCommonSharesthenoutstanding, but not including(i)any ExemptPerson;or(ii)any ExistingHolder,unless anduntilsuch time as suchExisting Holder becomestheBeneficial Ownerofoneor moreadditionalCommon Shares(otherthanpursuant to adividendor distribution paid or madeby the Company on the outstandingCommonShares inCommonSharesorpursuantto asplitor subdivision of the outstandingCommonShares),unlessuponbecoming theBeneficialOwnerofsuchadditionalCommonShares, suchExisting HolderdoesnotBeneficiallyOwn4.9%ormoreof theCommonSharesthenoutstanding.Notwithstandingtheforegoing,noPerson willbedeemed tobean Acquiring Person astheresultofanacquisition ofCommonSharesbyanExemptPersonthat, byreducingthe number ofCommonSharesthenoutstanding,increasesthe proportionate number ofCommonSharesthatareBeneficiallyOwnedbysuch Person to 4.9%ormoreof theCommonSharesthenoutstanding;provided,however,thatif a PersonbecomestheBeneficialOwnerof 4.9%or moreof theCommon Sharesthen outstandingsolely asthe resultof areduction inthe number ofCommon Sharesthen outstandingdue to anacquisition ofCommonSharesbyanExemptPersonand,after suchacquisition bysuchExemptPerson,becomestheBeneficialOwnerofoneormoreadditionalCommon Shares(otherthanpursuant to adividendor distribution paid or madeby the Company on the outstandingCommon Shares inCommonSharesorpursuantto asplitor subdivision of the outstandingCommonShares),thensuch Person willbedeemed tobean Acquiring Personunless,uponbecoming theBeneficialOwnerofsuchadditionalCommonShares, such PersondoesnotBeneficiallyOwn4.9%ormoreof theCommonSharesthenoutstanding.Notwithstandingtheforegoing,iftheBoard determines ingoodfaiththata Person whowouldotherwisebean Acquiring Personhas becomesuchinadvertently (includingbecause(A)such Person was unawarethatitBeneficiallyOwned apercentageof theCommonSharesthatwouldotherwise cause such Person tobean Acquiring Personor(B) such Person was awareof the extent of theCommonSharesthatitBeneficiallyOwnedbuthadnoactualknowledge of the consequences ofsuchBeneficialOwnershippursuanttothisPlan)andwithoutanyintentionofchangingor influencingcontrolof the Company,and if such Persondivestedor divests (including byenteringinto an agreement withthe Company, which agreement is satisfactory tothe Board inits sole discretion,todivest andsubsequently divestsinaccordancewiththetermsofsuch agreement,withoutexercisingorretaining anypower,including voting power, with respect to suchCommon Shares) aspromptly aspracticable a sufficientnumber ofCommon Shares sothatsuch Personwouldnolongerbean Acquiring Person,thensuch Person willnotbedeemed tobe ortohavebecomean Acquiring Person atanytime forany purposesof thisPlan. Forall purposesof thisPlan,anycalculation of the number ofCommonSharesoutstandingatany particulartime,includingforpurposesofdeterminingtheparticular percentageof the outstandingCommon Sharesof whichany Person istheBeneficial Owner, willbecalculated inaccordance withSection382andtheTreasuryRegulationspromulgated thereunder.
(b) “Adjustment Shares”hasthemeaningset forth inSection 11(a)(ii).
(c) “Affiliate”and“Associate”have therespectivemeaningsascribed to such terms inRule12b-2of theGeneralRulesandRegulationspromulgatedunderthe Exchange Act, as in effecton theRightsDividend Declaration Dateand,tothe extentnotincludedwithintheforegoing,will alsoinclude,with respect toanyPerson,anyotherPerson(otherthananExemptPersonoranExistingHolder) whose Stockor othersecurities (i)wouldbedeemed ownedconstructively or indirectly by such first Person for purposes of Section 382; (ii) would be deemed owned by a single “entity” as defined in Treasury Regulations § 1.382-3(a)(1) in which both such first Person and such other Person are included; or (iii) otherwise would be deemed aggregated with the Stock or other securities owned by such first Person pursuant to the provisions of Section 382;provided,however, that a Person will not be deemed to be an Affiliate or Associate of another Person solely because either or both such Persons are or were directors of the Company.
(d) A Person willbe deemed tobe the “Beneficial Owner” of,and willbe deemed to “BeneficiallyOwn”andhave “Beneficial Ownership” of,anysecurities:
(i) thatsuch Personoranyofsuch Person’s Affiliatesor Associates,directlyor indirectly, ownsorhasthe legal, equitable orcontractual rightorobligationtoacquire(whetherdirectlyorindirectly and whetherexercisableimmediatelyoronlyafterthepassageoftime,compliancewith regulatory requirements, satisfactionofoneormoreconditions(whetherornotwithinthecontrolofsuch Person)orotherwise)(A)pursuanttoanyagreement, arrangementor understandingwhetherornotin writing(otherthancustomary agreements withandbetween underwritersand selling groupmembers with respect to abonafidepublicofferingofsecurities); (B)upontheexerciseofany conversionrights,exchangerights,rights (otherthan theRights), warrantsor options, or otherwise; (C)pursuant tothe power torevoke a trust, discretionaryaccount or similar arrangement;(D)pursuant tothepower to terminate a repurchaseorsimilar so-called“stockborrowing” agreement, arrangementor understanding;(E)pursuanttotheautomatic terminationofa trust, discretionaryaccount orsimilar arrangement;or(F)anysecurities(includingrights,optionsorwarrants)thatareconvertible or exchangeableinto,orexercisable for,Common Sharesuntil such time as such securities areconverted,exchanged or exercised,except tothe extent that the acquisition or transferof securities(includingrights,optionsor warrants)wouldbe treated as exercisedon the date ofitsacquisition or transferpursuantto TreasuryRegulations § 1.382-4(d);provided,however, that a Person will not be deemed pursuant to this Section 1(d)(i) to be the Beneficial Owner of, or to Beneficially Own, securities (1) tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Person’s Affiliates or Associates until such tendered securities are accepted for purchase or exchange; (2) issuable upon the exercise of Rights at any time prior to the occurrence of a Triggering Event;(3) issuable upon the exercise of Rights from and after the occurrence of a Triggering Event if such Rights were acquired by such Person or any of such Person’s Affiliates or Associates prior to the Distribution Date or pursuant to Section 3(a) or Section 22 (the “Original Rights”) or pursuant to Section 11(g) in connection with an adjustment made with respect to any Original Rights; or (4) that a Person or any of such Person’s Affiliates or Associates may be deemed to have the right to acquire pursuant to any merger or other acquisition agreement between the Company and such Person (or one or more of its Affiliates or Associates), or any tender, voting or support agreement entered into by such Person (or one or more of its Affiliates or Associates) in connection therewith, if such agreement has been approved by the Board prior to there being an Acquiring Person;
(ii) that such Personoranyof such Person’s Affiliatesor Associates,directlyor indirectly,hastheright tovote(including the power tovoteor to directthevoting of)ordispose (or directthe disposition) of orhas “beneficial ownership”of (as determinedpursuantto Rule 13d-3 of the General Rules and Regulations promulgated under the Exchange Act, as in effect on the Rights Dividend Declaration Date), including pursuant to any agreement, arrangement or understanding whether or not in writing;provided,however, that a Person will not be deemed the Beneficial Owner of, or to Beneficially Own, any security pursuant to this Section 1(d)(ii) as a result of an agreement, arrangement or understanding whether or not in writing to vote such security if such agreement, arrangement or understanding (A) arises solely from a revocable proxy or consent given to such Person in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the applicable provisions of the General Rules and Regulations promulgated under the Exchange Act; and (B) is not also then reportable by such Person on Schedule 13D pursuant to the Exchange Act (or any comparable or successor report);
(iii) that areBeneficially Owned,directlyor indirectly, byanyother Person (oranyof such Person’s Affiliatesor Associates) with which such first Person (oranyof such first Person’s Affiliatesor Associates)has any agreement, arrangementor understandingwhetherornot in writing(otherthancustomary agreements withandbetween underwritersand selling groupmembers with respect to abonafidepublicofferingofsecurities) forthepurposeof acquiring,holding, voting (exceptpursuant to arevocable proxy tothe extent contemplated by theproviso toSection 1(d)(ii))or disposing ofany securitiesof the Company,but onlyiftheeffectofsuch agreement, arrangementor understandingis to treat such Persons as an“entity”pursuantto TreasuryRegulations § 1.382-3(a)(1);provided,however,that no person who is an officer,directoror employee of anExempt Person willbedeemed, solelyby reasonofsuch person’sstatusor authorityassuch,tobeaBeneficialOwner of, tohaveBeneficialOwnershipof ortoBeneficiallyOwnanysecuritiesof the Company thatareBeneficiallyOwned(includingin a fiduciarycapacity) byanExemptPersonor byanyothersuch officer,directoror employee ofanExempt Person;providedfurther,however,thatanystockholder of the Company, together withany Affiliate, Associateor other person who maybe deemed tobea representativeofsuchstockholder thenserving as adirectorof the Company,willnotbedeemed tobe theBeneficialOwner of, tohaveBeneficialOwnershipof or toBeneficiallyOwnany securitiesof the Company held byanyother Person as a resultofany Person affiliatedor otherwiseassociated with suchstockholder serving as adirectorof the Company or takinganyaction inconnection therewith;or
(iv) thatarethesubjectofaderivative transaction enteredinto bysuch Personoranyofsuch Person’s Affiliatesor Associates,including,forthese purposes, any derivativesecurityacquiredbysuch Personoranyofsuch Person’s AffiliatesorAssociatesthat givessuch Personoranyofsuch Person’s AffiliatesorAssociatesthe economic equivalent ofownershipofanamount ofsecuritiesduetothefactthat the value of thederivativesecurity isexplicitlydeterminedbyreference tothepriceor value ofsuch securities,or that providessuch Personoranyofsuch Person’s AffiliatesorAssociates anopportunity,directlyor indirectly,to profitorto share inanyprofitderivedfromanychangeinthe value ofsuch securities, inanycasewithoutregard towhether(A)thederivativesecurityconveysanyvotingrightsin such securities to such Personoranyofsuch Person’s AffiliatesorAssociates; (B)thederivativesecurity is required tobe,or capable ofbeing,settledthroughdeliveryofsuch securities;or(C) such Personoranyofsuch Person’s AffiliatesorAssociates mayhaveenteredinto othertransactionsthathedgethe economic effectof thederivative security.Indeterminingthe number ofCommon SharesthatareBeneficiallyOwnedbyvirtueof theoperation of this Section 1(d)(iv), the subject Person will be deemed to Beneficially Own (without duplication) the notional or other number of Common Shares that, pursuant to the documentation evidencing the derivative security, may be acquired upon the exercise or settlement of the applicable derivative security or as the basis upon which the value or settlement amount of such derivative security, or the opportunity of the holder of such derivative security to profit or share in any profit, is to be calculated, in whole or in part, and in any case (or if no such number of Common Shares is specified in such documentation or otherwise) as determined by the Board in good faith to be the number of Common Shares to which the derivative security relates. Notwithstanding anything in this Plan to the contrary, to the extent not within the foregoing provisions of this Section 1(e), a Person will be deemed to be the Beneficial Owner of, and will be deemed to Beneficially Own or have Beneficial Ownership of, Stock held by any other Person that such Person would be deemed to own constructively or indirectly or otherwise would be aggregated with Stock owned by such Person pursuant to Section 382.
(e) “Board” has the meaning set forth in the recitals at the beginning of this Plan.
(f) “Book Entry Shares” has the meaning set forth in Section 3(a).
(g) “Business Day” means any day otherthan a Saturday,Sundayor adayonwhichthe Federal ReserveBank of New York isclosed.
(h) “Closeof Business”onanygiven date means5:00p.m., New YorkCity time,on suchdate;provided,however,that if suchdate isnot aBusiness Day, it means5:00 p.m., New YorkCity time,on the nextsucceeding Business Day.
(i) “Code”hasthemeaningset forth inthe recitals atthebeginningof this Plan.
(j) “Common Shares” means,unlessotherwise specified,thesharesofcommonstock, parvalue$0.01 pershare,of the Company.When used with reference toany Personother than the Company,Common Shares meansthecapital stock withthe greatestvotingpower,or the equity securitiesor other equityinteresthavingpower tocontrolordirectthemanagement,ofsuch Person or, if such Person is a Subsidiaryof anotherPerson,of thePersonthatultimately controlssuch first-mentioned Person.
(k) “Common Share Equivalents”hasthemeaningset forth inSection 11(a)(iii).
(l) “Company”hasthemeaningset forth inthe preamblehereto, subject tothe termsofSection 13(a).
(m) “Current Per Share Market Price”ofany security(a “Security” forpurposesof thisdefinition), forallcomputations other than those madepursuanttoSection 11(a)(iii), meansthe averageof the daily closing pricesper shareof such Security forthe 30 consecutiveTrading Daysimmediately priortobut not includingsuchdate, andforpurposesof computationsmadepursuanttoSection11(a)(iii),theCurrent Per Share Market PriceofanySecurityonanydatewill be deemed to be the average of the daily closing prices per share of such Security for the 10 consecutive Trading Days immediately following but not including such date;provided,however, that in the event that the Current Per Share Market Price of the Security is determined during any period following the announcement by the issuer of such Security of (i) a dividend or distribution on such Security payable in shares of such Security or securities convertible into such shares (other than the Rights); or (ii) any subdivision, combination, consolidation, reverse stock split or reclassification of such Security, and the ex-dividend date for such dividend or distribution, or the record date for such subdivision, combination, consolidation, reverse stock split or reclassification, has not occurred prior to the commencement of the requisite 30 Trading Day or 10 Trading Day period as set forth above, then, and in each such case, the Current Per Share Market Price will be appropriately adjusted to take into account ex-dividend trading. The closing price for each day will be the last sale price, regular way, reported at or prior to 4:00 p.m., New York City time, or, if no such sale takes place on such day, the average of the bid and asked prices, regular way, reported as of 4:00 p.m. New York City time, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on NASDAQ or, if the Security is not listed or admitted to trading on NASDAQ, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which the Security is listed or admitted to trading or, if the Security is not listed or admitted to trading on any national securities exchange, the last quoted price reported at or prior to 4:00 p.m., New York City time, or, if on such date the Security is not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported as of 4:00 p.m., New York City time, by NASDAQ or such other system then in use, or, if on any such date the Security is not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the Security selected by the Board. If on any such date no market maker is making a market in the Security, the fair value of the Security on such date as determined in good faith by the Board will be used, which determination will be described in a statement filed with the Rights Agent and will be conclusive and binding on the Rights Agent and the holders of the Rights. If the Current Per Share Market Price of the Preferred Shares cannot be determined in the manner provided above or if the Preferred Shares are not publicly held or not listed or traded in a manner described above, then the Current Per Share Market Price of the Preferred Shares will be conclusively deemed to be (x) the Current Per Share Market Price of the Common Shares as determined pursuant to this Section 1(m) multiplied by(y)1,000(as suchnumbermaybeappropriately adjustedto reflectanysubdivision, combination, consolidation,reversestock splitorreclassificationofCommon Shares occurring aftertheRightsDividend Declaration Date).Ifthe Security(otherthan the Preferred Shares) isnot publiclyheld ornot solistedortraded,orifonanysuchdate theSecurity isnotsoquotedandnosuch market maker ismakinga market intheSecurity,then theCurrent Per Share Market Price meansthefairvalueperSecurity as determined ingoodfaithby theBoard,afterconsultationwith anationallyrecognized investmentbankingfirm, whosedetermination willbe described in a statement filed withtheRightsAgentand willbe conclusiveandbindingon theRightsAgentandtheholdersof the Rights.
(n) “CurrentExchange Value” meansthe product of the Current Per Share Market PriceofCommon Shareson the date of the occurrenceof anExchangeDetermination (orthe nextBusinessDay, if suchdateisnotaBusinessDay)multiplied by the number ofCommonShares for whichtheRightwould otherwisebe exchangeable (without regard towhether there were sufficientCommon Sharesavailable therefor).
(o) “Current Value”hasthemeaning set forth inSection 11(a)(iii).
(p) “Distribution Date” meanstheearlierof(i)theCloseofBusinesson the10thBusinessDay (or suchlaterdateas maybedeterminedby action of theBoard, whichaction mustbetaken prior totheDistributionDatethat otherwisewouldhaveoccurred) afterthe SharesAcquisitionDate (or, ifthe10thBusinessDay afterthe SharesAcquisition Date occurs beforethe Record Date,then theRecord Date);or (ii)theCloseofBusinesson the10thBusinessDay (or suchlaterdate as maybe determinedby theBoard) afterthe date that atender or exchange offerbyanyPerson(otherthan anExemptPerson) is firstpublished,sentor givenwithinthemeaningof Rule14d-2(a)of theGeneralRulesandRegulationspromulgatedunderthe ExchangeAct if, assumingthesuccessfulconsummationthereof, such Personwouldbe an Acquiring Person;provided,however,that ifanytender or exchange offer referred to inclause (ii) of this Section 1(p) is cancelled, terminated or otherwise withdrawn prior to the Distribution Date without the purchase or exchange of any Common Shares pursuant thereto, then such offer will be deemed, for purposes of this paragraph, never to have been made.
(q) “Equivalent Shares” meansany classor seriesofcapital stockof the Companyhavingthe same rights,privileges and preferences asthePreferred Shares.
(r) “ExchangeAct” meanstheSecuritiesExchange Actof1934,asamended.
(s) “ExchangeDetermination”has the meaningset forth inSection 24(a).
(t) “ExchangeRatio”hasthemeaningset forth inSection 24(a).
(u) “Exemption Request”hasthemeaningset forth inSection 25(a).
(v) “Exempt Person” means (i)the Company oranySubsidiaryof the Company, in each caseincludingthe officersand membersof the boardofdirectorsthereofactingintheir fiduciarycapacities;or(ii)anyemployeebenefitplan of the Company or ofany Subsidiaryof the Company, oranyentity ortrusteeholding (oracting in a fiduciarycapacity in respect of) sharesofcapital stockof the Company fororpursuant tothetermsofany suchplan or forthepurposeof funding other employeebenefits foremployeesof the Company orany Subsidiaryof the Company.
(w) “Exercise Price” isinitially $35.00 for eachoneone-thousandth of a Preferred Shareissuable pursuant tothe exerciseof aRightand issubjecttoadjustmentfrom time to time asprovidedinSection11 orSection13.
(x) “Existing Holder” meansany Person whoor that, together withall Affiliatesand Associatesof such Person, is,immediately prior tothe firstpublicannouncement of theadoptionof this Plan,theBeneficial Ownerof 4.9%or moreof theCommon Sharesthenoutstanding.Notwithstandinganythingtothe contrary inthis Plan,any Existing Holder who,together withallAffiliates and Associates of such Person, becomes at any time the Beneficial Owner of less than 4.9% of the Common Shares then outstanding will cease to be an Existing Holder and will be subject to all the provisions of this Plan in the same manner as any Person who is not and was not an Existing Holder.
(y) “ExpirationDate” meanstheearliest tooccur of(i)theCloseofBusinesson theFinalExpirationDate; (ii)the RedemptionDate; (iii)thetime at whichthe Board ordersthe exchange of theRights asprovided inSection24; (iv) ifStockholder Approval isnotobtained atthefirstannualmeetingof the stockholders of the Companyfollowingthe date of this Plan,theCloseofBusinesson the date of suchstockholdermeeting,or theCloseofBusinessonfirst anniversaryof the date of this Plan, ifStockholderApprovalhasnot otherwisebeenobtained by thatdate; (v)thecloseofbusinesson the effectivedate of the repealofSection382oranyother change iftheBoard, inits sole discretion, determinesthat this Plan isnolonger necessaryor desirable forthepreservationof theTax Benefits; (vi)thetime at whichtheBoard determinesthat theTaxBenefitsare fullyutilized or nolongeravailablepursuanttoSection382or that an ownershipchangepursuant toSection382wouldnot adversely impact inany material respectthe timeperiod in whichthe Company couldusetheTax Benefits,ormateriallyimpairthe amount of theTaxBenefitsthat could beusedby the Companyinany particulartimeperiod,forapplicabletax purposes;or(vii) adeterminationby theBoard,inits sole discretion and priortotheDistributionDate,that thisPlanandtheRightsarenolonger inthebest interestsof the Companyand its stockholders.
(z) “FinalExpirationDate” means March 3,2023.
(aa)“NASDAQ” means TheNASDAQ Stock Market LLC.
(bb) “Original Rights” has the meaningset forth in Section 1(d)(i).
(cc) “Person” means any individual, firm, corporation, partnership, limited liability company, joint venture, business trust, trust, association, syndicate, group (as such term is used in Rule 13d-5 of the General Rules and Regulations promulgated under the Exchange Act, as in effect on the Rights Dividend Declaration Date), other entity or any group of Persons maVking a “coordinated acquisition” of Common Shares within the meaning of Treasury Regulations § 1.382-3(a)(1) or who are otherwise treated as an “entity” within the meaning of Treasury Regulations § 1.382-3(a)(1), and, in each case, will include any successor (by merger or otherwise) of any such Person, but will not include a Public Group (as defined in Treasury Regulations § 1.382-2T(f) (13)).
(dd) “Plan” has the meaningset forth in the preamble at the beginning of this Plan.
(ee) “Post-Event Transferee” has the meaning set forth in Section 7(e).
(ff) “Pre-Event Transferee” has themeaning set forth in Section 7(e).
(gg) “Preferred Shares” meansshares of Series A Participating Preferred Stock, par value $0.01 per share, of the Company and, to the extent that there are not a sufficient number of shares of Preferred Shares authorized to permit the full exercise of the Rights, any other series of preferred stock of the Company designated for such purpose containing terms substantially similar to the terms of the Preferred Shares.
(hh) “Principal Party” has the meaning setforth in Section 13(b).
(ii) “Record Date” has the meaning set forth in the recitals at the beginning of this Plan.
(jj) “Redemption Date” has the meaning set forth in Section 23(a).
(kk) “Redemption Price” has the meaning set forth in Section 23(a).
(ll) “Requesting Person” has the meaning set forth in Section 25(a).
(mm) “Right” has the meaning set forth in the recitals at the beginning of this Plan.
(nn) “Rights Agent” has the meaning set forth in the preamble hereto.
(oo) “Rights Certificate” means a certificate substantially in the form attached as Exhibit B.
(pp) “Rights Dividend Declaration Date” has the meaning set forth in the recitals at the beginning of this Plan.
(qq) “Section 11(a)(ii) Event” means any event described in Section 11(a)(ii).
(rr) “Section 11(a)(ii) Trigger Date” has the meaning set forth in Section 11(a)(iii).
(ss) “Section 13 Event” means any event described in clause (i), (ii) or (iii) of Section 13(a).
(tt) “Section 382” means Section 382 of the Code or any successor or replacement provision and the Treasury Regulations promulgated
(uu) “Securities Act” means the Securities Act of 1933, as amended.
(vv) “Security” has the meaning set forth in Section 1(m).
(ww) “Shares Acquisition Date” means the first date of public announcement (which, for purposes of this definition, includes the filing or amending of a report pursuant to Section 13(d) of the Exchange Act or pursuant to a comparable successor statute) by the Company or an Acquiring Person that an Acquiring Person has become such or that discloses information that reveals the existence of an Acquiring Person.
(xx) “Spread” means the excess of (i) the Current Value over (ii) the Exercise Price.
(yy) “Stock” means with respect to any Person, such Person’s (i) common shares; (ii) preferred shares (other than preferred shares described in Section 1504(a)(4) of the Code); and (iii) any other interest that would be treated as “stock” of such Person pursuant to Treasury Regulations § 1.382-2T(f) (18).
(zz) “Stockholder Approval” means the approval of this Plan by the affirmative vote of the majority of shares of Common Stock present in person or represented by proxy and entitled to vote on the proposal at a meeting of the stockholders of the Company (or any adjournment or postponement thereof) duly held in accordance with the Company’s Amended and Restated Certificate of Incorporation, as amended, the Company’s Amended and Restated Bylaws, and applicable law.
(aaa) “Subsequent Transferee” has the meaning set forth in Section 7(e).
(bbb) “Subsidiary” of any Person means any firm, corporation, partnership, limited liability company, joint venture, business trust, trust, association, syndicate or other entity (whether or not incorporated) of which an amount of voting securities sufficient to elect a majority of the directors or Persons having similar authority, or a majority of the equity or ownership interests, is Beneficially Owned, directly or indirectly, by such Person, or any firm, corporation, partnership, limited liability company, joint venture, business trust, trust, association, syndicate or other entity (whether or not incorporated) otherwise controlled by such Person.
(ccc) “Substitution Period” has the meaning set forth in Section 11(a)(iii).
(ddd) “Summary of Rights” means a summary of this Plan substantially in the form attached as Exhibit C.
(eee) “Tax Benefits” means net operating losses, capital loss carryovers, general business credit carryovers, alternative minimum tax credit carryovers, foreign tax credit carryovers or any loss or deduction attributable to a “net unrealized built-in loss” within the meaning of Section 382, in each case of the Company or any of its Subsidiaries, and any other tax attribute the benefit of which is subject to possible limitation pursuant to Section 382.
(fff) “Trading Day” means a day on which the principal national securities exchange on which a referenced security is listed or admitted to trading is open for the transaction of business or, if a referenced security is not listed or admitted to trading on any national securities exchange, a Business Day.
(ggg) “Treasury Regulations” means the final, temporary and proposed income tax regulations promulgated by the United States Department of the Treasury pursuant to the Code, as amended or superseded from time to time.
(hhh) “Triggering Event” means any Section 11(a)(ii) Event or Section 13 Event.
(iii) “Trust” has the meaning set forth in Section 24(b)(ii).
(jjj) “Trust Agreement” has the meaning set forth in Section 24(b)(ii).
(kkk) “Waiver Request” has the meaning set forth in Section 25(b).
Section 2.Appointment of Rights Agent. The Company hereby appoints the Rights Agent to act as rights agent for the Company and the holders of the Rights (who, in accordance with Section 3, will prior to the Distribution Date also be the holders of the Common Shares) in accordance with the express terms and conditions hereof, and the Rights Agent hereby accepts such appointment. Upon 10 days’ prior written notice to the Rights Agent, the Company may from time to time appoint such co-rights agents as it may deem necessary or desirable. If the Company appoints one or more co-rights agents, then the respective duties of the Rights Agent and such co-rights agents will be as the Company determines, and the Company will promptly notify each rights agent of its respective duties. The Rights Agent will have no duty to supervise and will in no event be liable for the acts or omissions of, any co-rights agent.
Section 3.Issuance of Rights Certificates.
(a) RightsEvidencedbyCertificatesforCommonSharesandBookEntryShares.UntiltheDistributionDate, (i)theRights(unless earlierexpired,redeemedorterminated)willbe evidenced(subject tothe provisions ofSection3(b)and Section3(c))by thecertificates forCommonShares registered inthenamesof theholders thereofor, inthecaseofuncertificatedCommonShares registered inbookentry form(“BookEntry Shares”),bynotationinbookentryaccountsreflectingtheownershipofsuchCommonShares (which certificatesandBookEntry Shares, asapplicable,will alsobedeemed tobeRightsCertificates)andnotbyseparateRightsCertificates;and(ii)theRights(andtherightto receiveRightsCertificates) willbetransferableonlyinconnectionwiththetransferof the underlyingCommonShares(includinga transfer totheCompany).AssoonaspracticableaftertheDistributionDate,the Company will prepareandexecute, theRights Agent willcountersign, bymanualor facsimilesignature, andthe Company will sendor cause tobesent (andtheRightsAgent will, if so requestedandprovidedwithallnecessary informationand documents,attheCompany’sexpensesend)(bymailing,inaccordancewithSection27 or bysuchreasonablemeans as maybeselectedby the Company)to each recordholderofCommonShares asof theCloseofBusinesson theDistribution Date(otherthanany Acquiring Personoranyofits Affiliatesor Associates), atthe addressof suchholder shownon the transferbooksof the Company or thetransferagentfortheCommonShares,oneormoreRightsCertificatesevidencingone Rightfor eachCommonShare soheld,subjecttoadjustmentasprovidedherein. ReceiptofaRightsCertificatebyanyPerson willnotprecludealater determinationthatallorpartof theRightsrepresentedtherebyarenullandvoidpursuanttoSection7(e). Tothe extent thataSection11(a)(ii)Event hasalso occurred,the Companymayimplementsuch procedures as it deemsappropriateinits sole discretiontominimizethe possibility thatRightsare receivedbyanyPerson whoseRightsarenullandvoidpursuanttoSection7(e).Inthe event thatanadjustmentinthe number ofRightsper CommonSharehas beenmadepursuanttoSection11,thenatthetimeof distribution of theRights Certificates,the Company will makethe necessaryand appropriateroundingadjustments (inaccordance withSection 14(a)) sothatRights Certificates representingonlywhole numbersofRights aredistributed and cash ispaid inlieuofany fractionalRights (inaccordance with Section 14(a)). As of and after the Distribution Date, the Rights will be evidenced solely by the Rights Certificates and may be transferred by the transfer of the Rights Certificates as permitted hereby, separately and apart from any transfer of Common Shares, and the holders of such Rights Certificates as shown on the transfer books of the Company or the transfer agent for the Rights (which may be the Rights Agent) will be the record holders thereof. The Company will promptly notify the Rights Agent in writing upon the occurrence of the Distribution Date. Until such notice is provided to the Rights Agent, it may presume conclusively for all purposes that the Distribution Date has not occurred.
(b) SummaryofRights;OutstandingCommonShares.TheCompanywill makeavailable, orcause tobemadeavailable,promptlyaftertheRecord Date, acopy of theSummaryofRightstoanyholderofRightswho may so request from time to timepriortotheExpirationDate. With respect to certificates forCommonSharesandBookEntry Shares, asapplicable, outstandingasof theRecord DateorissuedsubsequenttotheRecord Date,untiltheearlierof theDistributionDateor theExpirationDate,theRightswillbe evidenced bysuch certificatesorBookEntry Shares,andtheregisteredholdersof theCommon Shares will alsobe the registeredholdersof theassociatedRights. Untilthe earlierof theDistribution Dateor theExpiration Date,the surrender for transferofany CommonShares in respectofwhichRightshavebeenissued (withor withoutacopy of theSummaryof Rights)will alsoconstitute thetransferof theRightsassociatedwith suchCommonShares.Notwithstandinganythingtothecontrary inthisPlan,upontheeffectivenessofaredemption pursuant toSection23 or anexchangepursuant toSection24,the Company willnot thereafter issueanyadditional Rightsand, forthe avoidance ofdoubt,noRightswillbeattachedtoorwillbeissued withany CommonShares(includingany CommonShares issuedpursuantto anexchange)atanytime thereafter.
(c) Legend.Rightswillbeissued in respectofall CommonSharesthatare issued (whether as anoriginal issuanceorfromtheCompany’streasury) afterthe Record Datebutprior tothe earlierof theDistribution Dateor theExpiration Date. Certificates representing suchCommon Shares will alsobedeemed tobecertificates forRights,andwillbearsubstantially thefollowinglegendif such certificates are issued aftertheRecord Datebutpriortotheearlierof theDistributionDateor theExpirationDate:
THIS CERTIFICATE ALSO EVIDENCESAND ENTITLES THEHOLDER HEREOF TO CERTAIN RIGHTSAS SET FORTHIN A TAX BENEFIT PRESERVATIONPLAN,DATEDAS OFMARCH 3,2020,BETWEENAVIATNETWORKS, INC.(THE“COMPANY”)ANDCOMPUTERSHARE INC.,AS RIGHTSAGENT(OR ANY SUCCESSOR RIGHTSAGENT THEREUNDER),AS THE SAME MAY BE AMENDEDORSUPPLEMENTED FROM TIME TO TIME(THE “PLAN”), THE TERMSOF WHICH ARE HEREBY INCORPORATED HEREIN BY REFERENCEAND A COPYOF WHICHIS ON FILEAT THE PRINCIPAL EXECUTIVE OFFICESOF THE COMPANY.UNDER CERTAIN CIRCUMSTANCES,ASSET FORTHINTHEPLAN,SUCH RIGHTS(ASDEFINED INTHEPLAN)MAY BE REDEEMED, MAY BECOME EXERCISABLEFORSECURITIESORASSETSOFTHE COMPANYORSECURITIESOF ANOTHER ENTITY, MAY BEEXCHANGED FOR SHARESOF COMMON STOCKOR OTHER SECURITIESOR ASSETSOF THE COMPANY, MAY EXPIREORMAY BE EVIDENCED BY SEPARATE CERTIFICATESANDMAYNO LONGERBE EVIDENCED BYTHISCERTIFICATE. THE COMPANYWILL MAIL TO THEHOLDER OF THIS CERTIFICATE A COPYOF THE PLANAS IN EFFECTON THEDATE OF MAILINGWITHOUTCHARGE AFTER RECEIPTOFA WRITTEN REQUEST THEREFOR.UNDERCERTAINCIRCUMSTANCES ASSET FORTH IN THE PLAN, RIGHTS THATAREBENEFICIALLY OWNED BY, TRANSFERRED TO ORHAVEBEENOWNED BYANACQUIRINGPERSON(ASDEFINED IN THE PLAN) ORANYOF ITS AFFILIATES(ASDEFINED IN THE PLAN) OR ASSOCIATES(ASDEFINED IN THE PLAN) WILL BE NULLAND VOIDAND WILLNO LONGER BE TRANSFERABLE.
With respect toanyBookEntry Shares, alegendinsubstantiallysimilar form willbe includedin anoticetotherecordholderofsuch shares inaccordancewithapplicablelaw. With respect to such certificates for Common SharesorBookEntry Shares, asapplicable,containingtheforegoinglegend,untiltheearlierof theDistributionDateor theExpirationDate, (i)theRightsassociatedwiththeCommon Shares representedbysuch certificatesorBookEntry Shares willbe evidencedsolelyby such certificatesorBook Entry Shares; (ii)the registeredholdersof the Common Shares will alsobe the registeredholdersof theassociatedRights;and (iii)the surrender for transferofany such certificatesorBook Entry Shares (withor without acopy of the Summaryof Rights)will alsoconstitute the transferof theRightsassociated withthe Common Shares representedthereby. NotwithstandingthisSection 3(c),the omissionof the legend requiredhereby,the inclusion of alegend that makes reference to arights agreementortax benefit preservationplan other than this Planor the failure toprovide noticethereof willnot affecttheenforceabilityofany partof this Planor therightsofanyholderof Rights.
(d) Acquisitions of Rights by the Company.Inthe event that the Company purchasesoracquires any Common Shares afterthe Record Datebutprior tothe earlierof theDistribution Dateor theExpiration Date,anyRightsassociated with suchCommon Shares willbe deemedcancelled and retired sothat the Company willnotbe entitled to exerciseanyRightsassociated withtheCommon Sharesthat arenolonger outstanding.
Section 4.Form of Rights Certificates.
(a) RightsCertificates. TheRights Certificates (andthe formof election to purchaseand formofassignment,includingthecertifications therein,tobeprintedon thereverse thereof) willbe substantiallyintheformof ExhibitB,andmayhavesuch marksof identification or designationandsuchlegends,summariesorendorsements printed thereonasthe Companymaydeem appropriate(but whichdonotaffecttherights,duties,responsibilitiesor liabilities of theRightsAgent) and arenotinconsistent withthe provisions of this Plan,or as maybe required tocomply withanyapplicablelawor withanyruleorregulation madepursuant thereto, withanyapplicable ruleorregulationofanyapplicablestockexchange ortrading systemor theFinancialIndustry Regulatory Authority, or to conform to customary usage. Subject to the provisions of Section 11 and Section 22, the Rights Certificates, whenever distributed, will be dated as of the Record Date (or in the case of Rights issued with respect to Common Shares issued by the Company after the Record Date, as of the date of issuance of such Common Shares) and on their face will entitle the holders thereof to purchase such number of one one-thousandths of a Preferred Share as will be set forth therein at the Exercise Price, but the number and type of securities purchasable upon the exercise of each Right and the Exercise Price will be subject to adjustment as provided herein.
(b) Certain Legends.AnyRightsCertificate issuedpursuanttoSection3(a),Section 11(g)orSection22 thatrepresentsRightsthatareBeneficially Ownedby an Acquiring Person, an Affiliateor Associateof an Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, aSubsequentTransfereeoranynominee ofanyof theforegoing, and anyRightsCertificate issuedpursuanttoSection6orSection11upontransfer,exchange,replacementoradjustmentofanyotherRights Certificate referred to inthissentence, willcontain (tothe extent that theRights Agenthasnoticethereof andtothe extentfeasible)substantially thefollowinglegend:
THE RIGHTS REPRESENTED BYTHISRIGHTS CERTIFICATE AREORWERE BENEFICIALLYOWNEDBY A PERSONWHO WAS ORBECAMEAN ACQUIRING PERSONOR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON(AS SUCH TERMS AREDEFINED IN THEPLAN).ACCORDINGLY,THISRIGHTS CERTIFICATEANDTHE RIGHTS(ASSUCH TERMS AREDEFINED INTHEPLAN)REPRESENTED HEREBY MAY BECOMENULLAND VOIDIN THE CIRCUMSTANCES SPECIFIEDIN SECTION 7(e)OF THEPLAN.
(c) Uncertificated Rights. Notwithstandinganything tothe contrary inthis Plan,the CompanyandtheRights Agent may amendthis Plan toprovide for uncertificatedRights inaddition toor inplaceofRightsevidenced byRights Certificates.
Section 5.Countersignature and Registration.
(a) Countersignature. TheRights Certificates willbe executed on behalf of the Company byits Chairmanof theBoard,Chief Executive Officer, President,ChiefFinancialOfficer, Secretary, Assistant Secretaryorany SeniorVice President, whichexecutionwillbeattestedtoby theSecretaryoran Assistant Secretaryof the Company,in each caseeithermanuallyor byfacsimilesignature, andwillhaveaffixed theretotheCompany’sseal (ifany) ora facsimile thereof. TheRightsCertificates willbe countersigned, eithermanuallyor byfacsimilesignature,byanauthorized signatoryof theRightsAgent,butit willnotbenecessary forthesamesignatorytocountersign allof theRightsCertificates.NoRightsCertificate willbe validforany purpose unless countersignedby theRightsAgent.Ifany directororofficerof the Companywhohas signedorattestedtoanyof theRightsCertificates ceases tobesuchdirectororofficerof the Companybeforecountersignatureby theRightsAgentand issuance and deliveryby the Company,suchRightsCertificatesneverthelessmaybecountersignedby theRightsAgentandissuedand deliveredby the Companywiththesame forceandeffect asthoughtheperson whosignedorattested to suchRights Certificateson behalf of the Companyhadnot ceased tobe adirectoror officerof the Company. AnyRights Certificate maybesignedorattested toon behalf of the Company byany person who, asof theactualdate of the execution of suchRights Certificate, is aproper directororofficerof the Company tosign suchRights Certificate,although atthe date of the execution of this Planany such person wasnot such adirectoror officer.
(b) TransferBooks. FollowingtheDistributionDate,theRightsAgent willkeeporcause tobe kept,atitsofficedesignatedfor suchpurposes,books for registrationand transferof theRights Certificates issuedhereunder. Suchbooks willshowthe namesand addressesof the respectiveholdersof theRights Certificates,the number ofRightsevidenced onits faceby eachof theRights Certificates,the certificatenumber of eachof theRights Certificatesandthe date ofeachof theRightsCertificates. TheRightsAgent willnotregister,orpermit toberegistered,anytransferor exchange ofanyRightsCertificates (orthe underlying Rights) that havebecomenullandvoidpursuanttoSection7(e),havebeenredeemedpursuanttoSection23 or havebeenexchangedpursuanttoSection24.
Section 6.Transfer, Split Up, Combination and Exchange of Rights Certificates; Mutilated, Destroyed, Lost or Stolen Rights Certificates.
(a) Transfer,Split Up,CombinationandExchange of RightsCertificates. Subject tothe provisions ofSection 4(b),Section 7(e),Section14and Section24,atanytime aftertheCloseofBusinesson theDistributionDate,andatorpriortotheCloseofBusinesson theExpirationDate,anyRightsCertificate(otherthananyRights Certificate representingRightsthat havebecomenullandvoidpursuant toSection 7(e),that havebeen redeemedpursuanttoSection23 or that havebeenexchangedpursuanttoSection24)maybetransferred,splitup,combined or exchangedforanotherRightsCertificateentitling the registeredholder to purchase alike number ofoneone-thousandths of a Preferred Share (or,following a TriggeringEvent, other securities, cashor other assets, asthe case maybe) astheRights Certificate surrenderedthen entitled suchholder (or formerholderinthe caseof a transfer) to purchase. Any registeredholderdesiring to transfer,splitup,combine or exchangeanyRightsCertificate will make such request in writingdeliveredtotheRightsAgent, andwill surrendertheRightsCertificate,togetherwithanyrequired formofassignmentdulyexecutedandproperlycompleted,tobetransferred,splitup,combined or exchanged atthe officeof theRights Agentdesignated for suchpurpose accompanied by a signature guarantee from an eligible guarantor institution participating in a signature guarantee program approved by the Securities Transfer Association. TheRights Certificates are transferableonlyon thebooksand recordsof theRightsAgent. NotwithstandinganythinginthisPlan tothecontrary,neither theRightsAgentnorthe Companywillbe obligatedtotakeanyactionwhatsoeverwith respect tothetransferofanysuch surrenderedRightsCertificateuntiltheregisteredholderhasproperlycompleted anddulyexecuted thecertificatecontained inthe formofassignmenton the reversesideof suchRightsCertificateand hasprovided suchadditionalevidence of the identity of theBeneficialOwner (or formerBeneficialOwner)orAffiliatesorAssociates thereof, in each case asthe Company or theRightsAgentreasonablyrequests.Thereupon, subject toSection 4(b),Section 7(e),Section14and Section24,theRights Agent willcountersign (bymanualor facsimilesignature) anddelivertothePersonentitledthereto aRightsCertificate as sorequested.TheCompany or theRightsAgent may requirepaymentfromtheholderofaRightsCertificateofa sum sufficient tocoverany taxorgovernmentalchargethatmaybeimposedinconnectionwithanytransfer,splitup,combination or exchange ofanyRightsCertificate.Ifandtothe extent that the Company doesrequirepaymentofanysuchtaxorcharge,the Companywillprovide theRightsAgent prompt writtennoticethereofand the Rights Agent will not deliver any Right Certificate unless and until the Rights Agent is satisfied that all such payments have been made, and the Rights Agent will forward any such sum collected by it to the Company or to such Person as the Company specifies by written notice. The Rights Agent will not have any duty or obligation to take any action pursuant to any Section of this Plan related to the issuance or delivery of Rights Certificates unless and until it is satisfied that all such taxes or charges have been paid.
(b) Mutilated,Destroyed, Lostor Stolen RightsCertificates. Subjecttothe provisions ofSection7(e),Section11(a)(ii)and Section24,atanytime aftertheDistributionDateand priortotheExpirationDate,uponreceiptby the CompanyandtheRightsAgentof evidencereasonablysatisfactory tothem of theloss, theft,destructionor mutilation ofaRightsCertificateandsuchadditionalevidence of the identity of theBeneficialOwner (or formerBeneficial Owner)or Affiliatesor Associatesthereof asthe Company or theRights Agent may request,and, in caseof loss, theftordestruction,of indemnity or securityreasonably satisfactory to them,and reimbursement tothe CompanyandtheRights Agentofall reasonable expensesincidentalthereto, anduponsurrender totheRightsAgentandcancellation of theRightsCertificate ifmutilated, the Companywill makeanddeliveranewRightsCertificateof like tenortotheRightsAgent forcountersignature and deliverytotheregisteredholderinlieuof theRightsCertificate solost,stolen,destroyedor mutilated.EverynewRightsCertificate issuedpursuanttothisSection6(b) inlieuofany lost,stolen,destroyedormutilatedRightsCertificate willevidenceanoriginaladditionalcontractualobligationof the Company,whetherornotthelost,stolen,destroyedormutilatedRightsCertificate willbeatanytime enforceablebyanyone,and,subject toSection 7(e) willbe entitled toallthebenefitsof this Planequallyandproportionately withany and allotherRights dulyissuedhereunder.
Section 7.Exercise of Rights; Exercise Price; Expiration Date of Rights.
(a) ExerciseofRights. SubjecttoSection7(e),Section 23(b) and Section24(a),theregisteredholderofanyRightsCertificate may exercisetheRightsevidencedthereby(except as otherwiseprovidedherein)inwholeorin partonany BusinessDay atoraftertheDistributionDateand priortotheCloseofBusinesson theExpirationDatebysurrenderof theRightsCertificate, withtheformof electionto purchaseandcertificateon thereverseside thereofproperlycompleted anddulyexecuted,totheRightsAgent attheofficeof theRightsAgentdesignatedfor suchpurpose,togetherwithpaymentof the Exercise Price for eachoneone-thousandth of a Preferred Share (or,following a TriggeringEvent, other securities, cashor other assets, asthe case maybe)as to whichtheRightsare exercised.
(b) Exercise Price.The Exercise Price ispayable inaccordance withSection 7(c).
(c) Payment.Exceptas otherwiseprovidedinthisPlan,uponreceiptofaRightsCertificate representing exercisableRights,withtheformof electionto purchaseandcertification properlycompleted anddulyexecuted,accompaniedbypaymentof theaggregateExercise Price forthe total number ofoneone-thousandths of a Preferred Share (or,following a TriggeringEvent, other securities, cashor other assets, asthe case maybe) tobe purchasedand anamount equal toanyapplicable transfertaxorgovernmental charge required tobe paid by theholderof suchRightsCertificate in accordance with Section 9(e), the Rights Agent will, subject to Section 7(f) and Section 20(j), thereupon promptly (i) (A) requisition from any transfer agent of the Preferred Shares (or make available, if the Rights Agent is the transfer agent for the Preferred Shares) a certificate for the total number of one one-thousandths of a Preferred Share (or, following a Triggering Event, other securities, cash or other assets, as the case may be) to be purchased (or, in the case of uncertificated shares or other securities, requisition from the transfer agent a notice setting forth such number of shares or other securities to be purchased for which registration will be made on the transfer books of the Company), and the Company hereby irrevocably authorizes its transfer agent to comply with all such requests; or (B) if the Company has elected to deposit the total number of one one-thousandths of a Preferred Share (or, following a Triggering Event, other securities, cash or other assets, as the case may be) issuable upon exercise of the Rights hereunder with a depositary agent, requisition from such depositary agent depositary receipts representing interests in such number of one one-thousandths of a Preferred Share (or, following a Triggering Event, other securities, cash or other assets, as the case may be) as are to be purchased (in which case certificates for the Preferred Shares (or, following a Triggering Event, other securities, cash or other assets, as the case may be) represented by such receipts will be deposited by the transfer agent with such depositary agent) and the Company hereby irrevocably directs such depositary agent to comply with such request; (ii) when necessary to comply with the terms of this Plan, requisition from the Company the amount of cash, if any, to be paid in lieu of the issuance of fractional shares in accordance with Section 14; (iii) after receipt of such certificates, notices, or depositary receipts, cause the same to be delivered to or upon the order of the registered holder of such Rights Certificate, registered in such name or names as may be designated by such holder; and (iv) when necessary to comply with the terms of this Plan, after receipt thereof, deliver such cash to or upon the order of the registered holder of such Rights Certificate. The payment of the Exercise Price (as such amount may be reduced (including to zero) pursuant to Section 11(a)(iii)), and an amount equal to any applicable transfer tax or governmental charge required to be paid by the holder of such Rights Certificate in accordance with Section 9(e), may be made by certified bank check, money order, cashier’s check or bank draft payable to the order of the Company. In the event that the Company is obligated to issue securities of the Company other than Preferred Shares, pay cash or distribute other property pursuant to Section 11(a), then the Company will make all arrangements necessary so that such other securities, cash or other property are available for distribution by the Rights Agent, if and when necessary to comply with the terms of this Plan. Notwithstanding anything to the contrary in this Plan, the Company reserves the right to require that prior to the occurrence of a Triggering Event, upon any exercise of Rights, a number of Rights be exercised so that only whole Preferred Shares would be issued.
(d) Partial Exercise.Ifthe registeredholderofanyRights Certificate exercises lessthanalltheRightsevidencedthereby,then anewRightsCertificateevidencingRightsequivalent totheRights remainingunexercised willbe issuedby theRights Agentand delivered tooruponthe orderof theregisteredholderof suchRights Certificate, registered in such name as maybe designated by suchholder, subject tothe provisions ofSection14.
(e) ProhibitedIssuances.Notwithstandinganythingtothecontrary inthisPlan, fromandafterthefirst occurrenceofa TriggeringEvent,anyRightsthatareorwereacquiredorBeneficiallyOwnedby(i) an Acquiring Personoran AffiliateorAssociateofan Acquiring Person, (ii) a transfereeofan Acquiring Person (or an AffiliateorAssociateofan Acquiring Person) whobecomesa transferee aftertheAcquiring Personbecomessuch(a“Post-Event Transferee”), (iii) a transfereeof an Acquiring Person (or an Affiliateor Associateof an Acquiring Person) whobecomes a transfereeprior toorconcurrentlywiththeAcquiring Personbecomingsuchandreceives suchRightspursuanttoeither(A)a transfer (whetherornotforconsideration)fromtheAcquiring Person (or an AffiliateorAssociateof theAcquiring Person) toholdersof equityinterests in such Acquiring Person (or an AffiliateorAssociateofsuch Acquiring Person)ortoanyPerson with whomtheAcquiring Person (or an AffiliateorAssociateof theAcquiring Person)has anycontinuingagreement, arrangementor understandingwhetherornotin writing regardingthetransferredRightsor(B) a transferthat theBoardhasdetermined is partofaplan,arrangementor understanding thathasas a primarypurposeoreffectthe avoidance of thisSection7(e)(a“Pre-Event Transferee”), (iv)anysubsequenttransfereereceiving transferredRights from a Post-Event Transfereeor a Pre-Event Transferee,eitherdirectlyor throughoneor moreintermediate transferees(a “Subsequent Transferee”),or (v)anynominee ofanyof theforegoing will, in each case,becomenullandvoidwithoutany furtheraction,andnoholder(whetherornotsuchholderis an Acquiring Personoran AffiliateorAssociateofan Acquiring Person)ofsuchRightswillhaveany rights whatsoever(including therightto exercise) with respect to suchRightsoranyRightsCertificatesthatformerlyevidencedsuchRights,whether pursuanttoany provisionof thisPlanorotherwise. Fromandafterthefirst occurrenceofa TriggeringEvent, noRightsCertificate willbeissuedpursuanttothisPlan(including to an Acquiring Person, an Affiliateor Associateof an Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, aSubsequent Transfereeoranynominee ofanyof theforegoing)that representsoneor moreRightsthat areor havebecomenullandvoidpursuant tothisSection 7(e)or with respect toany CommonShares otherwise deemed tobeBeneficiallyOwnedbyanyof theforegoing, and anyRightsCertificatedeliveredtotheRightsAgentthatrepresentsRightsthat areor havebecomenullandvoidpursuant tothisSection 7(e) willbe cancelled. TheCompany will useall reasonable efforts to ensurethat the provisions of thisSection7(e)and Section4(b) arecompliedwith,butneither the CompanynortheRightsAgent willhaveanyliabilitytoanyholderofRightsCertificatesortoanyotherPerson as a resultof theCompany’sfailure to makeany determinationswith respect to an Acquiring Person, an AffiliateorAssociateofan Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, aSubsequentTransfereeoranynominee ofanyof theforegoing.TheCompanywillprovide theRightsAgent with writtennotice of the identity ofanysuch Acquiring Person, AffiliateorAssociateofan Acquiring Person, Post-Event Transferee, Pre-Event Transferee,Subsequent Transfereeoranynominee ofanyof theforegoing, andtheRights Agent may relyonsuchnoticein carryingoutitsdutiespursuanttothisPlanandwillbedeemednottohaveanyknowledge of the identity ofanysuch Personunless anduntilithasreceived suchnotice.
(f) InformationConcerningOwnership. Notwithstandinganything tothe contrary inthis PlanoranyRights Certificate,neither theRights Agentnorthe Company isobligated toundertakeanyaction with respect to a registeredholderofRights uponthe occurrenceofany purported exerciseor transferofRightsas set forth inthisSection7unlesssuch registeredholder,inadditiontohavingcompliedwiththerequirementsofSection7(a),has(i) properlycompleted anddulyexecuted the certificatecontained inthe formof election to purchaseor formofassignment, asapplicable, set forth on the reverse side of the Rights Certificate surrendered for such exercise or assignment; and (ii) provided such additional evidence (including the identity of the Beneficial Owner (or former Beneficial Owner) thereof and of the Rights evidenced thereby, and the Affiliates or Associates of such Beneficial Owner or former Beneficial Owner) as the Company or the Rights Agent may reasonably request. If such registered holder does not comply with the foregoing requirements, then the Company will be entitled to conclusively deem such Rights to be Beneficially Owned by an Acquiring Person (or an Affiliate or Associate of an Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, a Subsequent Transferee or any nominee of any of the foregoing, as applicable) and, accordingly, such Rights will be null and void and not exercisable or transferable.
Section 8.Cancellation and Destruction of Rights Certificates. All Rights Certificates surrendered for the purpose of exercise, transfer, split up, combination, redemption or exchange will, if surrendered to the Company or to any of its agents, be delivered to the Rights Agent for cancellation or in cancelled form, or, if surrendered to the Rights Agent, will be cancelled by it, and no Rights Certificates will be issued in lieu thereof except as expressly permitted by any of the provisions of this Plan. The Company will deliver to the Rights Agent for cancellation and retirement, and the Rights Agent will so cancel and retire, any Rights Certificate purchased or acquired by the Company otherwise than upon the exercise thereof. Subject to applicable law, the Rights Agent will maintain electronic or physical records of all Rights Certificates that have been cancelled or destroyed by the Rights Agent. At the Company’s expense, the Rights Agent must maintain such electronic or physical records for the time period required by applicable law. The Rights Agent must deliver all cancelled Rights Certificates to the Company or, at the written request of the Company, must destroy, or cause to be destroyed, such cancelled Rights Certificates, and in such case must deliver a certificate evidencing the destruction thereof to the Company (or, at the Company’s option, appropriate copies of the electronic or physical records relating to Rights Certificates so cancelled or destroyed by the Rights Agent).
Section 9.Reservation and Availability of Preferred Shares.
(a) Reservation. TheCompany covenantsand agreesthat it will useall reasonable efforts to cause tobe reservedandkept availableoutofits authorized and unissued Preferred Sharesnot reserved foranotherpurpose (and,followingthe occurrenceof a TriggeringEvent,outofits authorized and unissued Common Sharesor other securities,oroutofits authorized and issued sharesheld in treasury),the number of Preferred Shares (and,followingtheoccurrenceof a TriggeringEvent,Common Sharesor other securities)that willbe sufficient to permitthe exercise in fullofalloutstanding Rights.
(b) Listing. Solong asthe Preferred Shares (and,followingthe occurrenceof a TriggeringEvent,Common Sharesor other securities)issuable and deliverableuponthe exerciseof theRights maybelistedonanynational securitiesexchange, the Company must useall reasonable efforts to cause, fromandafter such time astheRightsbecomeexercisable (butonlytothe extent thatit isreasonablylikely that theRightswillbeexercised),allshares reserved for suchissuance tobelistedon suchexchangeupon officialnotice ofissuanceupon such exercise.
(c) Registration.TheCompanymust useall reasonableefforts to (i) file, assoonaspracticable followingtheearliestdateafterthefirst occurrenceof aSection 11(a)(ii)Eventin whichtheconsideration tobedeliveredby the Companyuponexerciseof theRights is described inSection 11(a)(ii)orSection 11(a)(iii),or assoonas is requiredbylaw followingtheDistribution Date, asthe case maybe, a registration statementpursuant tothe Securities Act with respect tothe securitiespurchasableupon exerciseof theRightson anappropriateform; (ii) cause such registration statement tobecome effective assoonaspracticableafter suchfiling; and(iii) cause such registration statement to remain effective (with aprospectusatalltimesmeetingtherequirementsof theSecurities Act)untiltheearlierof(A)the dateasofwhichtheRightsarenolongerexercisable for such securitiesand(B)theExpirationDate. TheCompany may temporarilysuspend(with prompt writtennotice ofany suspensionprovided totheRightsAgent), from time to time for aperiodnottoexceed120daysafterthe dateset forth inclause(i)of thefirstsentenceof thisSection9(c),theexercisabilityof theRightsin order to prepareandfile such registration statementandpermit it tobecomeeffectiveorin order to prepareandfileany supplementoramendmentto such registration statementthat theBoard determines tobenecessarypursuanttoapplicablelaw. Uponanysuchsuspension, the Companywill issue apublicannouncement stating,and promptly notifytheRightsAgent in writing,that theexercisabilityof theRightshas beentemporarilysuspended,as well as issue apublicannouncement,and promptly notifytheRightsAgent in writing, at such time asthesuspensionisnolongerin effect.Inaddition,ifthe Companydeterminesthata registration statement is requiredfollowingtheDistribution Date,then the Company may temporarilysuspendtheexercisabilityof theRights until such time as such registration statementhas beendeclared effective. TheCompanywill alsotakesuchactionas maybeappropriate under,orto ensurecompliancewith,thesecuritiesor “bluesky”lawsof thevariousstates inconnectionwiththeexercisabilityof the Rights,as well asanyother applicablelaw, ruleor regulation.Notwithstandinganythingtothecontrary inthisPlan,theRightswillnotbeexercisable inany jurisdiction unlesstherequisitequalificationin suchjurisdiction has beenobtained(andtheexercisethereofis permittedpursuanttoapplicablelaw),oranexemptiontherefrom isavailable,anduntila registration statement in respectthereof has beendeclaredandremains effective.
(d) ValidIssuance. TheCompany covenantsandagreesthatit willtakeallsuchactionas maybenecessary to ensurethatallPreferred Shares (and,followingthe occurrenceof a TriggeringEvent,Common Sharesor other securitiesof the Company)deliveredupon exerciseofRights will, atthe timeofdeliveryof thecertificates for such securities (or registrationon thetransferbooksof the Company or thetransferagentfor such securities) (subject topaymentof the Exercise Price, if any),bedulyandvalidlyauthorized and issuedand fullypaidand nonassessable.
(e) Transfer TaxesandGovernmentalCharges.TheCompanyfurthercovenantsandagreesthatit willpaywhendueandpayableany and alltransfertaxes and governmentalchargesthatmaybe payablein respectof theoriginal issuanceordeliveryofRightsCertificates (oranyPreferred Share,Common Shareor other securityof the Company, asthe case maybe)uponthe exerciseor exchange of Rights.Notwithstandingtheforegoing,the Companyisnotrequired to (i)pay anytransfertaxorgovernmentalchargethatmaybe payablein respectofanytransferordeliveryofRightsCertificates (or certificatesordepositaryreceipts for Preferred Shares,CommonSharesor othersecuritiesof the Company,asthecase maybe)in a nameother than, or theissuanceor delivery of certificates or depositary receipts for Preferred Shares, Common Shares or other securities of the Company, as the case may be, in a name other than, that of the registered holder of the Rights Certificate evidencing Rights surrendered for exercise or exchange; or (ii) issue or deliver any certificates or depositary receipts for Preferred Shares, Common Shares or other securities of the Company, as the case may be, upon the exercise or exchange of any Rights until any such transfer tax or charge has been paid (any such transfer tax or charge being payable by the registered holder of such Rights Certificate at the time of surrender or exchange) or it has been established to the Company’s and the Rights Agent’s satisfaction that no such tax or charge is due. The foregoing also applies to any transfer taxes and governmental charges that may be payable in respect of any uncertificated Rights Certificates, shares or other securities.
Section 10.Record Date for Securities Issued. Each Person in whose name any certificate for a number of one one-thousandths of a Preferred Share (or any other security of the Company, including Common Shares) is issued (or registration on the transfer books of the Company or the applicable transfer agent is effected) upon the exercise or exchange of Rights will for all purposes be deemed to have become the holder of record of such fractional Preferred Share (or other security of the Company) represented thereby on, and such certificate will be dated (or registration on the transfer books of the Company or the applicable transfer agent effected), the date on which the Rights Certificate evidencing such Rights was duly surrendered and payment of the applicable Exercise Price, if any, together with any applicable transfer tax or governmental charge required to be paid by the holder of such Rights Certificate in accordance with Section 9(e), was made;provided,however, that if the date of such surrender and payment is a date upon which the transfer books of the Company (or the applicable transfer agent) are closed, then such Person will be deemed to have become the record holder of such fractional Preferred Shares (or other securities of the Company) on, and such certificate will be dated (or registration on the transfer books of the Company or the applicable transfer agent effected), the next succeeding Business Day on which the transfer books of the Company (or the applicable transfer agent) are open. Prior to the exercise of the Rights evidenced thereby, the holder of a Rights Certificate is not entitled to any rights of a holder of Preferred Shares (or any other security of the Company) for which the Rights are exercisable, including the right to vote, to receive dividends or other distributions, or to exercise any preemptive rights, and is not entitled to receive any notice of any proceedings of the Company, except as provided herein.
Section 11.Adjustment of Exercise Price, Number and Kind of Shares or Number of Rights. The Exercise Price, the number and kind of shares or other property covered by each Right and the number of Rights outstanding are subject to adjustment from time to time as provided in this Section 11.
(a) Certain Events.
(i) Certain Adjustments to PreferredShares. Notwithstandinganything tothe contrary inthis Plan, inthe event that the Company atanytime aftertheRightsDividendDeclaration Date(A)declares adividendon thePreferred Sharespayablein Preferred Shares, (B)subdivides orsplitsthe outstanding Preferred Shares, (C)combines or consolidates theoutstanding Preferred Shares (by reverse stock split or otherwise) into a smaller number of Preferred Shares or (D) issues any shares of its capital stock in a reclassification of the Preferred Shares (including any such reclassification in connection with a share exchange, consolidation or merger in which the Company is the continuing or surviving corporation), then, in each such event, except as otherwise provided in this Section 11(a)(i) and Section 7(e), (1) the Exercise Price in effect at the time of the record date for such dividend or of the effective date of such subdivision, split, combination, consolidation or reclassification, and the number and kind of Preferred Shares or capital stock of the Company, as the case may be, issuable on such date, will be proportionately adjusted so that the holder of any Right exercised after such time will be entitled to receive, upon payment of the Exercise Price then in effect, the aggregate number and kind of Preferred Shares or securities of the Company, as the case may be, that, if such Right had been exercised immediately prior to such date (and at a time when the Preferred Shares transfer books of the Company were open), such holder would have owned upon such exercise and been entitled to receive by virtue of such dividend, subdivision, split, combination, consolidation or reclassification;provided,however, that in no event will the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the shares of capital stock of the Company issuable upon the exercise of one Right. If an event occurs that would require an adjustment pursuant to both this Section 11(a)(i) and Section 11(a)(ii), then the adjustment provided for in this Section 11(a)(i) will be in addition to, and will be made prior to, any adjustment required pursuant to Section 11(a)(ii).
(ii) Exerciseof Rights FollowingCertain Events.Subject toSection23and Section24, inthe event thatany Person, atany time aftertheRightsDividendDeclaration Date,becomesan Acquiring Person,unlessthe eventcausingsuch Person tobecomean Acquiring Person is atransactionset forth inSection13(a)thenpromptly followingtheoccurrenceofsucheventeachholderofaRight,exceptasprovided belowandinSection7(e), will thereafterhave theright to receive for eachRight, upon exercisethereof inaccordance withthe termsof this Planand paymentof the Exercise Price in effectimmediately prior tothe occurrenceof suchevent, inlieuof anumber ofoneone-thousandths of a Preferred Share, suchnumber ofCommon Shares asequals thequotientobtained bydividing(A)the product obtained by multiplying(1)theExercise Price in effectimmediately priortothefirst occurrenceofsuchevent by(2)the number ofoneone-thousandths ofa Preferred Share for which aRightwas exercisable (orwouldhavebeenexercisable iftheDistributionDatehad occurred)immediately prior tothe first occurrenceof suchevent by (B)50%of the Current Per Share Market Price forCommon Shareson the date ofsuch first occurrenceofsuchevent(suchnumber ofshares,the“Adjustment Shares”);provided,however,that theExercise Priceandthe number ofCommon Shares soreceivableuponthe exerciseof aRight willbesubject to furtheradjustment asappropriate inaccordance withSection 11(e).Inthe event thataSection11(a)(ii)Event hasoccurredandtheRightsareoutstanding,then,subjecttoSection28,the Companymaynottakeanyaction thatwould eliminateordiminishthebenefitsintended tobe affordedby the Rights. TheCompany willpromptly notifytheRights Agent in writing whenthis
Section 11(a)(ii) applies.
(iii) Insufficient CommonShares.Inthe event that the number ofCommon Sharesthat areauthorizedby theCompany’s Amendedand Restated CertificateofIncorporation, asamended,but notoutstanding or reserved forissuance forpurposesother thanupon exerciseof theRights are not sufficient to permit the exercise in full of the Rights in accordance with Section 11(a)(ii), or if any necessary regulatory or stockholder approval for such issuance has not been obtained by the Company, then, in the event that the Rights become exercisable, the Company will (A) determine the value of the Adjustment Shares issuable upon the exercise of a Right (the “Current Value”) and (B) with respect to each Right (subject to Section 7(e)), make adequate provision to substitute for the Adjustment Shares issuable pursuant thereto, upon the exercise of a Right and the payment of the applicable Exercise Price, (1) cash, (2) a reduction in the Exercise Price, (3) Preferred Shares, (4) other equity securities of the Company (including shares or units of shares of any series of preferred stock that, by virtue of having dividend, voting and liquidation rights substantially comparable to those of the Common Shares, the Board has deemed in good faith to have substantially the same value or economic rights as the Common Shares (such shares or units of shares of preferred stock, “Common Share Equivalents”)), (5) debt securities of the Company, (6) other assets or (7) any combination of the foregoing, in each case having an aggregate value equal to the Current Value (less the amount of any reduction in the Exercise Price), where such aggregate value has been determined by the Board based upon the advice of a nationally recognized investment banking firm selected by the Board, which determination will be described in a written statement filed with the Rights Agent and will be binding on the Rights Agent and the holders of the Rights;provided,however, that if the Company has not made adequate provision to deliver value pursuant to clause (B) above within 30 days following the later of (x) the first occurrence of a Section 11(a)(ii) Event and (y) the date on which the Company’s right of redemption pursuant to Section 23(a) expires (the later of (x) or (y), the “Section 11(a)(ii) Trigger Date”), then the Company will be obligated to deliver, upon the surrender for exercise of a Right and without requiring payment of the Exercise Price, Common Shares (to the extent available and except to the extent that the Company has not obtained any necessary stockholder or regulatory approval for such issuance) and such number or fractions of Preferred Shares and then, if necessary, cash, which shares or cash have an aggregate value equal to the Spread. If the Board determines in good faith that it is likely that sufficient additional Common Shares could be authorized for issuance upon exercise in full of the Rights or that any necessary stockholder or regulatory approval for such issuance could be obtained, the 30 day period set forth above may be extended and re-extended to the extent necessary (with prompt written notice of any such extension provided to the Rights Agent) from time to time, but not more than 120 days after the Section 11(a)(ii) Trigger Date, so that the Company may seek stockholder approval for the authorization of such additional Common Shares or take such action necessary to obtain such regulatory approval (such period, as it may be extended, the “Substitution Period”). To the extent that the Company determines that some action need be taken pursuant to the first or second sentences of this Section 11(a)(iii), the Company (a) will provide, subject to Section 7(e), that such action applies uniformly to all outstanding Rights and (b) may suspend the exercisability of the Rights until the expiration of the Substitution Period in order to seek such stockholder approval, to take any action necessary to obtain such regulatory approval or to decide the appropriate form of distribution to be made pursuant to such first sentence and to determine the value thereof. In the event of any such suspension, the Company will issue a public announcement (and promptly provide written notice to the Rights Agent) stating that the exercisability of the Rights has been temporarily suspended, as well as issue a public announcement (and promptly provide written notice to the Rights Agent) at such time as the suspension is no longer in effect. For purposes of this Section 11(a)(iii), the value of the Common Shares will be the Current Per Share Market Price of the Common Shares on the Section 11(a)(ii) Trigger Date and any Common Share Equivalent will be deemed to have the same value as the value of the Common Shares on such date. The Board may, but will not be required to, establish procedures to allocate the right to receive Common Shares upon the exercise of the Rights among holders of Rights pursuant to this Section 11(a)(iii).
(iv) DilutiveRightsOffering.Ifthe Company, atany time aftertheRightsDividend Declaration Date, fixes a recorddate fortheissuanceof rights,optionsor warrants toall holdersof Preferred Sharesentitling suchholders (for aperiod expiring within45 days after such recorddate) to subscribe fororpurchase Preferred Sharesor EquivalentShares,orsecuritiesconvertible intoPreferred Sharesor EquivalentShares, at a pricepershare (orhavingaconversionorexercise pricepershare, if a securitythatisconvertible into orexercisable for Preferred Sharesor EquivalentShares) lessthan theCurrent Per Share Market Priceof thePreferred Sharesonsuch recorddate,then,in each such case,theExercise Price tobein effect after such recorddatewillbedeterminedby multiplying theExercise Price in effectimmediately priorto such recorddate bya fraction,thenumeratorofwhich willbe the number ofPreferred SharesandEquivalent Shares (ifany) outstanding on such recorddate,plusthe number of Preferred Sharesor Equivalent Shares, asthe case maybe,that theaggregateoffering priceof the total number ofPreferred Sharesor EquivalentShares, asthecase maybe,tobeofferedorissued (ortheaggregateinitialconversionpriceof the convertiblesecurities tobeofferedorissued) wouldpurchase at such Current Per Share Market Price,andthe denominator ofwhich willbe the number of Preferred SharesandEquivalent Shares (ifany) outstanding on such recorddate,plusthe number ofadditional Preferred Sharesor EquivalentShares, asthecase maybe,tobeoffered forsubscriptionorpurchase (orintowhichthe convertiblesecurities so tobeoffered areinitiallyconvertible);provided,however,that inno event willtheconsideration tobe paiduponthe exerciseofone Rightbe lessthan theaggregate parvalue of thesharesofcapital stockof the Companyissuableuponthe exerciseofone Right.If suchsubscription price maybe paid in aconsideration partorallof which is in a formother than cash,then the value of suchconsideration willbe as determined ingood faithby theBoard, whosedetermination willbe described in a written statement filed withtheRights Agentand willbebindingon theRights Agentandtheholdersof the Rights. Preferred SharesandEquivalent Shares ownedby or heldforthe account of the Companywillnotbedeemedoutstandingforthepurposeofanysuchcomputation.Suchadjustmentwillbemadesuccessively wheneversuch a recorddateisfixed, andinthe event thatsuch rights,optionsorwarrants arenotsoissued,then theExercise Price willbeadjusted tobe the Exercise Pricethatwouldthen be in effect if such recorddatehadnotbeen fixed.
(b) Distributions.Ifthe Company, atany time aftertheRightsDividend Declaration Date, fixes a recorddate forthemakingof adistribution toall holdersof Preferred Shares(includingany suchdistribution made inconnection with a shareexchange, consolidation or merger in whichthe Company isthecontinuingorsurviving corporation)of cash(otherthan aperiodic cashdividend outof theearningsor retainedearningsof theCompany), assets(otherthanadividendpayablein Preferred Shares,but includinganydividendpayableinstockother thanPreferred Shares),evidences of indebtedness,subscription rights,optionsor warrants(excluding those referred to inSection 11(a)(iv)),then, in each such case,the Exercise Price tobe in effect aftersuch record date will be determined by multiplying the Exercise Price in effect immediately prior to such record date by a fraction, the numerator of which will be the Current Per Share Market Price of a Preferred Share on such record date, less the fair market value per Preferred Share (as determined in good faith by the Board, whose determination will be described in a statement filed with the Rights Agent and will be conclusive and binding on the Rights Agent and the holders of the Rights) of the portion of the cash, assets or evidences of indebtedness to be so distributed or of such subscription rights, options or warrants applicable to one Preferred Share, and the denominator of which will be such Current Per Share Market Price of a Preferred Share on such record date;provided,however, that in no event will the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the shares of capital stock of the Company issuable upon the exercise of one Right. Such adjustment will be made successively whenever such a record date is fixed, and in the event that such distribution is not so made, then the Exercise Price will be adjusted to be the Exercise Price that would have been in effect if such record date had not been fixed.
(c) Insignificant Changes.Notwithstandinganythingtothecontrary inthisPlan,noadjustmentintheExercise Price is requiredunlesssuchadjustment wouldrequire an increaseordecreaseofat least1% of theExercise Price;provided,however,thatany adjustmentsthat byreasonof thisSection11(c) arenotrequired tobemade willbecarried forwardand takeninto accountinanysubsequentadjustment.AllcalculationspursuanttothisSection11 mustbe made tothe nearestcentor tothe nearestten-millionthof a Preferred Shareor ten-thousandth ofanyother shareorsecurity, asthe case
may be. Notwithstanding the first sentence of this Section 11(c), any adjustment required by this Section 11 must be made no later than the earlier of (i) three years from the date of the transaction that requires such adjustment or (ii) the Expiration Date.
(d) SharesOtherThan PreferredShares.If as a resultof anadjustmentmadepursuant toSection 11(a)orSection 13(a),theholderofanyRightthereafter exercised willbecomeentitledto receiveany sharesofcapital stockother than Preferred Shares,thenthereafterthe number of suchother shares soreceivableupon exerciseofanyRightand,if required,the Exercise Price thereof, willbesubject toadjustment from time to time in amanner andon terms as nearlyequivalent aspracticable tothe provisions with respect tothe Preferred SharescontainedinSection 11(a),Section 11(a)(iv),Section 11(b), Section 11(c), Section 11(f), Section 11(g), Section 11(h), Section 11(i), Section 11(j) and Section 11(k), and the provisions of Section 7, Section 9, Section 10 and Section 13 with respect to the Preferred Shares will apply on like terms to any such other shares.
(e) RightsIssuedSubsequenttoAdjustment.AllRightsoriginallyissuedby the Company subsequenttoany adjustmentmade totheExercise Pricehereunder willevidence theright to purchase, attheadjusted Exercise Price,the number ofoneone-thousandths of a Preferred Share (andother sharesof othercapital stockor other securities, assetsor cashof the Company, ifany)purchasable from time to timehereunderupon exerciseof the Rights,all subjectto furtheradjustmentasprovidedherein.
(f) EffectofAdjustmentsonExisting Rights. Unlessthe Companyhas exerciseditselection asprovided inSection 11(g),upon eachadjustmentof the Exercise Price as a resultof the calculations made inSection 11(a)(iv)and Section 11(b), eachRightoutstandingimmediately prior tothemakingofsuchadjustmentwill thereafterevidence therightto purchase, attheadjustedExercise Price,that number ofPreferred Shares(calculatedtothenearestten- millionth of a Preferred Share)obtained by (i)multiplying(A)the number ofoneone-thousandths of a Preferred Share coveredby aRightimmediately priortothisadjustmentby (B)the Exercise Price in effectimmediately prior to suchadjustmentof the Exercise Price;and (ii)dividingthe product soobtained by the Exercise Price in effectimmediately after suchadjustmentof the Exercise Price.
(g) Adjustment inNumberofRights. TheCompany may electon or afterthe date ofany adjustmentof the Exercise Price toadjustthe number of Rights,insubstitutionforany adjustmentinthe number ofoneone-thousandths ofa Preferred SharepurchasableupontheexerciseofaRight.Eachof theRightsoutstanding after suchadjustmentof the number ofRights willbe exercisable forthe number ofoneone-thousandths of a Preferred Share for which aRightwas exercisableimmediately priorto suchadjustment.EachRightheld ofrecordpriorto suchadjustmentof the number ofRightswillbecomethat number ofRights(calculated tothe nearestten-thousandth) obtained bydividingthe Exercise Price in effectimmediately prior toadjustmentof the Exercise Priceby theExercise Price in effectimmediatelyafteradjustmentof theExercise Price. TheCompanywill make apublicannouncement(andpromptlyprovidewrittennoticetotheRightsAgent)ofitselectiontoadjustthe number of Rights, indicating therecorddatefortheadjustmentand,ifknownatthetime,the amount of theadjustmenttobemade.Thisrecorddatemaybe the date onwhichtheExercise Price isadjustedorany daythereafter,but,ifanyRights Certificateshavebeen issued, willbe at least10 dayslaterthan the date of thepublicannouncement.IfanyRights Certificateshavebeen issued,uponeachadjustmentof the number ofRightspursuant tothisSection 11(g),the Company will, aspromptly aspracticable, distributeor cause tobedistributed toholdersof recordofRights Certificateson such recorddateRights Certificatesevidencing,subject toSection14,theadditional Rights to which suchholderswillbe entitledas a resultofsuchadjustment,or, attheoptionof the Company,willdistributeorcause tobedistributedto suchholdersofrecord insubstitutionandreplacement fortheRightsCertificatesheld bysuchholders priortothe date ofadjustment, anduponsurrender thereof, if requiredby the Company,newRightsCertificatesevidencingalltheRightsto which suchholderswillbe entitledafter suchadjustment.RightsCertificates tobesodistributed willbeissued,executedand deliveredby the Company,and countersigned and deliveredby theRightsAgent, inthemannerprovided for herein (and may bear, attheoptionof the Company, theadjustedExercise Price),andwillberegistered inthenamesof theholdersofrecordofRightsCertificateson therecorddatespecified inthepublicannouncement.
(h) RightsCertificatesUnchanged.Irrespectiveofany adjustmentor changeintheExercise Priceor the number ofoneone-thousandths ofa Preferred Shareissuableuponthe exerciseof the Rights, theRights Certificates theretoforeand thereafter issued maycontinue to expressthe Exercise Priceperoneone-thousandth of a Preferred Shareandthe number ofoneone-thousandths of a Preferred Sharethat were expressed inthe initialRights Certificates issuedhereunder.
(i) ParValueLimitations.Beforetakinganyaction thatwouldcause anadjustment reducingtheExercise Pricebelow theparorstatedvalue,ifany, of the number ofoneone-thousandths of a Preferred Shareissuableupon exerciseof the Rights, the Company willtakeany corporateaction that may, intheopinionofitscounsel, be necessary in orderthat the Company maydulyandvalidly issue as fullypaidand nonassessable shares suchnumber ofoneone-thousandthsofa Preferred Share at suchadjustedExercise Price.
(j) Deferred Issuance.Inany case in whichthisSection11 requiresthat anadjustment inthe Exercise Pricebe made effective asof a recorddatefor a specifiedevent, the Company may elect to defer (with prompt writtennotice totheRightsAgent)untilthe occurrenceof suchevent theissuance totheholderofanyRight exercised after such recorddate of the number ofoneone-thousandths of a Preferred Shareandothercapital stockor securities, assetsorcashof the Company, ifany,issuableupon such exerciseoverandabovethe number ofoneone-thousandths of a Preferred Shareandothercapital stockorsecurities, assetsor cashof the Company, ifany,issuableupon such exerciseon thebasisof the Exercise Price in effectprior to suchadjustment;provided,however,that the Company mustdeliver to suchholder aduebill or otherappropriate instrumentevidencing such holder’sright to receive suchadditionalshares (fractionalor otherwise)or securitiesuponthe occurrenceof the event requiring suchadjustment.
(k) Reduction in Exercise Price.Notwithstandinganything tothe contrary inthisSection11,the Company isentitled to make suchreductions intheExercise Price, inadditiontothoseadjustmentsexpressly requiredby thisSection11,asandtothe extent thatit,inits sole discretion,determines tobe advisable in orderthatany (i)consolidation or subdivision of the Preferred SharesorCommon Shares, (ii)issuance wholly for cashofany Preferred SharesorCommon Shares at lessthan the applicable Current Per Share Market Price, (iii)issuance wholly for cashof Preferred SharesorCommon Sharesor securitiesthat by theirterms areconvertible into or exchangeablefor Preferred SharesorCommonShares, (iv)stockdividendor(v)issuanceofrights,optionsorwarrants referred to inthisSection11 hereafter madeby the Company toholdersof Preferred SharesorCommon Shares isnottaxable to suchstockholders.
(l) No DiminishmentofBenefitofRights. TheCompany covenantsand agreesthat, aftertheDistribution Date, it willnot,except as permittedbySection23,Section24 orSection28,take(or permit tobe taken)anyactionif atthetimethatsuchactionistakenit isreasonablyforeseeablethatsuchaction willdiminishsubstantially or otherwiseeliminatethebenefitsintended tobe affordedby the Rights.
(m) Certain Adjustmentsto CommonShares. Notwithstandinganythingtothecontrary inthisPlan, inthe event that the Company,atanytime aftertheRightsDividendDeclaration Dateand priortotheDistributionDate, (i) declaresor paysadividendon theCommonSharespayableinCommonShares, (ii)subdivides orsplitsthe outstandingCommonShares(otherthan by thepaymentofdividendspayableinCommonShares), (iii)combines or consolidates the outstandingCommonShares (by reversestock splitorotherwise)intoa lessernumber ofCommonSharesor(iv) issuesanysharesofits capital stock in a reclassificationof theCommon Shares(includingany such reclassification inconnectionwith a shareexchange, consolidation or merger in whichthe Company isthecontinuingorsurviving corporation),then, in each suchevent, except as otherwiseprovidedinthisSection11 orSection 7(e): (A) eachCommonShare (or sharesofcapitalstock issued in such reclassification of the Common Shares) outstanding immediately following such time will have associated with it the number of Rights as were associated with one Common Share immediately prior to the occurrence of such event; (B) the Exercise Price in effect at the time of the record date for such dividend or of the effective date of such subdivision, split, combination, consolidation or reclassification will be adjusted so that the Exercise Price thereafter equals the result obtained by multiplying the Exercise Price in effect immediately prior to such time by a fraction, the numerator of which will be the total number of Common Shares outstanding immediately prior to such event and the denominator of which will be the total number of Common Shares outstanding immediately after such event;provided,however, that in no event will the consideration to be paid upon the exercise of one Right be less than the aggregate par value of the shares of capital stock of the Company issuable upon the exercise of such Right; and (C) the number of one one-thousandths of a Preferred Share (or shares of such other capital stock) issuable upon the exercise of each Right outstanding after such event equals the number of one one- thousandths of a Preferred Share (or shares of such other capital stock) as were issuable with respect to one Right immediately prior to such event. Each Common Share that becomes outstanding after an adjustment has been made pursuant to this Section 11(m) will have issued with it that number of Rights, exercisable at the Exercise Price and for the number of one one-thousandths of a Preferred Share (or shares of such other capital stock), as one Common Share has associated with it immediately following the adjustment made pursuant to this Section 11(m). If an event occurs that would require an adjustment pursuant to both this Section 11(m) and Section 11(a)(ii), then the adjustment provided for in this Section 11(m) will be in addition to, and will be made prior to, any adjustment required pursuant to Section 11(a)(ii). The adjustments provided for in this Section 11(m) will be made successively whenever such a dividend is declared or paid or such a subdivision, split, combination, consolidation or reclassification is effected.
(n) Adjustmentof RightsAssociatedwithCertain Distributions.Otherthaninconnectionwith atransactioncontemplated bySection11(m), inthe event that the Company,atanytime aftertheRightsDividendDeclaration Dateand priortotheDistributionDate, issuesordistributes anysecuritiesorassets in respectofCommonShares(otherthan(A)adistribution ordividendofits capital stock and(B)pursuanttoany non-extraordinary periodiccashdividend), then the Companywill make suchadjustments,ifany,intheExercise Priceor the number ofRightsorsecuritiesor otherpropertypurchasableupon exerciseofRights astheBoard, inits sole discretion, maydeem tobeappropriateunderthe circumstances in order toadequatelyprotectthe interestsof theholdersof theRightsgenerally, andthe CompanyandtheRights Agent will amendthis Plan asreasonably necessary toprovide for suchadjustments.
Section 12.Certificate of Adjusted Exercise Price or Number of Shares. Whenever an adjustment is made, or any event affecting the Rights or their exercisability (including an event that causes the Rights to become null and void) occurs as provided in Section 11 or Section 13, the Company must promptly (a) prepare a certificate setting forth such adjustment or describing such event and providing a reasonably detailed statement of the facts, computations and methodology accounting for such adjustment or event; (b) provide the Rights Agent and each transfer agent for the Common Shares or Preferred Shares a copy of such certificate; and (c) if a Distribution Date has occurred, mail a brief summary of such adjustment or event to each holder of a Rights Certificate in accordance with Section 26. Notwithstanding the foregoing, the failure of the Company to make or provide such certification or notice will not affect the validity of such adjustment or the force or effect of the requirement for such adjustment. The Rights Agent will (i) be fully protected in relying on any such certificate and on any adjustment or statement contained therein; (ii) have no duty or liability with respect thereto; and (iii) not be deemed to have knowledge of any such adjustment or event unless and until it has received such certificate.
Section 13.Consolidation, Merger or Sale or Transfer of Assets, Cash Flow or Earning Power.
(a) Certain Transactions.Inthe event that,followinga SharesAcquisitionDate,directlyor indirectly,(i)the Company consolidateswith,ormerges withandinto,anyotherPerson(otherthanawhollyowned Subsidiaryof the Companyin atransactionthatcomplieswithSection11(l))andthe Company isnotthecontinuingorsurvivingentity of suchconsolidation or merger; (ii)any Person(otherthan awholly owned Subsidiaryof the Company in atransactionthatcomplieswithSection11(l))consolidateswith,ormerges withandinto,the Company,andthe Companyisthecontinuingorsurvivingentity of suchconsolidation or mergerand, inconnection with suchconsolidation or merger,allor partof theCommon Shares arechanged into or exchangedforstockor other securitiesofanyother Personor the Company, or cashoranyotherproperty;or (iii)the Company sells,exchanges,mortgagesor otherwise transfers (oroneor moreofits Subsidiaries sells,exchanges,mortgagesor otherwise transfers), inonetransactionor a seriesof relatedtransactions, assets, cash floworearningpoweraggregatingto50%ormoreof theassets, cash floworearningpowerof the Companyand its Subsidiaries(taken as awhole)toanyotherPersonorPersons(otherthan the Company oroneormoreofits whollyownedSubsidiariesinoneormoretransactions,eachofwhichindividually(andtogether) complieswithSection11(l)),then,concurrent withandin each such case,proper provisionmustbemade sothat(A)eachholderofaRight(except asprovided inSection 7(e)) thereafterhastheright to receive,uponthe exercisethereof at a priceperRightequal tothe Exercise Pricemultiplied by the number ofoneone-thousandths ofa Preferred Share for which aRightwas exercisableimmediately priortotheoccurrenceofsuchSection13Eventinaccordancewiththetermsof thisPlan,andinlieuofPreferred Shares, suchnumber ofdulyandvalidlyauthorized andissuedandfullypaidand nonassessable and freelytradable Common Sharesof the Principal Party, freeofany liens, encumbrances,rightsof first refusalor other adverse claims, as willbe equal tothe resultobtained by (1)multiplying the then current Exercise Priceby the number ofoneone-thousandths of a Preferred Share for which aRightis exercisableimmediately priortothefirst occurrenceofaSection13Event(or, if aSection11(a)(ii)Event hasoccurredpriortothefirst occurrenceofaSection13 Event, multiplying the number ofsuchoneone-thousandths ofa Preferred Share for which aRightwas exercisableimmediately priortothefirst occurrenceof aSection 11(a)(ii)Eventby the Exercise Price in effectimmediately prior to such first occurrenceof aSection 11(a)(ii) Event);and (2)dividingthat product (which,followingthe first occurrenceof aSection13 Event, willbe referred to asthe “Exercise Price” for eachRightand forall purposesof thisPlan)by50%of theCurrent Per Share Market Priceof theCommonSharesofsuch Principal Partyon the date ofconsummationofsuchSection13 Event;provided,however,that the priceperRight sopayableandthe number ofCommon Sharesof such Principal Party soreceivableupon exerciseof aRight willbesubject to further adjustment as appropriate in accordance with Section 11(d) to reflect any events covered thereby occurring in respect of the Common Shares of such Principal Party after the occurrence of such Section 13 Event; (B) such Principal Party will thereafter be liable for, and must assume, by virtue of such Section 13 Event, all the obligations and duties of the Company pursuant to this Plan; (C) the term “Company” will thereafter be deemed to refer to such Principal Party, it being specifically intended that the provisions of Section 11 will apply only to such Principal Party following the first occurrence of a Section 13 Event; (D) such Principal Party must take such steps (including the reservation of a sufficient number of its Common Shares) in connection with the consummation of any such transaction as may be necessary to ensure that the provisions hereof will thereafter be applicable, as nearly as reasonably may be, in relation to its Common Shares thereafter deliverable upon the exercise of the Rights; (E) the provisions of Section 11(a)(ii) will be of no effect following the first occurrence of any Section 13 Event; and (F) upon the subsequent occurrence of any consolidation, merger, sale, exchange, mortgage, transfer or other extraordinary transaction in respect of such Principal Party, each holder of a Right will thereupon be entitled to receive, upon exercise of a Right and payment of the Exercise Price as provided in this Section 13(a), such cash, shares, rights, warrants and other property that such holder would have been entitled to receive had such holder, at the time of such transaction, owned the Common Shares of the Principal Party receivable upon the exercise of a Right pursuant to this Section 13(a), and such Principal Party must take such steps (including reservation of a sufficient number of shares of its capital stock) as may be necessary to permit the subsequent exercise of the Rights in accordance with the terms hereof for such cash, shares, rights, warrants and other property. For purposes hereof, the “earning power” of the Company and its Subsidiaries will be determined in good faith by the Board on the basis of the operating income of each business operated by the Company and its Subsidiaries during the three fiscal years preceding the date of such determination (or, in the case of any business not operated by the Company or any of its Subsidiaries during the three fiscal years preceding such date, during the period that such business was operated by the Company or any of its Subsidiaries).
(b) PrincipalParty. Forpurposesof this Plan,the term “Principal Party” means (i) inthecaseofany transaction described inclause (i)or (ii)ofSection 13(a)(A)thePersonthat isthe issuerof the securitiesinto whichtheCommonShares areconverted inthe consolidation or merger, or, if there is morethanonesuch issuer,the issuer whoseCommon Shareshave the greatestaggregate marketvalue of sharesoutstanding;or(B) ifno securities are soissued,(1) the Person that is the other party to the consolidation or merger, if such Person survives the consolidation or merger, or, if there is more than one such Person, the Person whose Common Shares have the greatest aggregate market value of shares outstanding; (2) if the Person that is the other party to the merger does not survive such consolidation or merger, the Person that does survive such consolidation or merger (including the Company if it survives); or (3) the Person resulting from the consolidation or merger; and (ii) in the case of any transaction described in clause (iii) of Section 13(a), the Person that is the party receiving the greatest portion of the assets, cash flow or earning power transferred pursuant to such transaction or transactions, or, if more than one Person that is a party to such transaction or transactions receives the same portion of the assets or earning power so transferred and each such portion would, were it not for the other equal portions, constitute the greatest portion of the assets or earning power so transferred, or if the Person receiving the greatest portion of the assets or earning power cannot be determined, whichever of such Persons is the issuer of Common Shares having the greatest aggregate market value of shares outstanding;provided,however, that in the case of each of clause (i) and (ii) of this Section 13(b), if the Common Shares of such Person are not at such time, or have not been continuously over the preceding 12-month period, registered pursuant to Section 12 of the Exchange Act, then if such Person is (x) a direct or indirect Subsidiary of another Person whose Common Shares are and have been so registered, the term “Principal Party” will refer to such other Person, a directorindirectSubsidiaryofmorethanonePerson whoseCommonShares areandhavebeenso registered,theterm “Principal Party” will refer towhicheverof such Persons isthe issuerofCommonShareshavingthe greatestaggregatemarketvalue of sharesoutstanding,or (z) if such Person isowned, directlyor indirectly, by ajointventureformedby twoor more Personsthatarenotowned, directlyor indirectly, by the same Person,the rules set forth inclauses(x)and (y)above willapplyto eachof the ownershaving an interest intheventure as ifthePerson ownedby thejointventurewas a Subsidiaryofbothorallofsuchjointventures,andthePrincipal Party in each such case mustbeartheobligationsset forth inthisSection13inthesame ratio asitsinterest in such Person bears tothe total ofsuch interests.
(c) CertainArrangements. TheCompanywillnotconsummateorpermit tooccurany Section13Event unless(A)thePrincipal Partyhasa sufficientnumber of authorized,unissued and unreservedCommon Shares to permitthe exercise in fullof theRightsinaccordance withthisSection13and(B)prior theretothe CompanyandthePrincipal Partyhave executedand delivered totheRightsAgent a supplemental agreement confirmingthat(1)therequirementsof thisSection13willbepromptly performed in accordance withtheirterms, (2)thePrincipal Party will,uponconsummationofsuchSection 13 Event, assume this Plan in accordance with Section 13(a) and Section 13(b), (3) such Section 13 Event will not result in a default by the Principal Party pursuant to this Plan (as it has been assumed by the Principal Party) and (4) the Principal Party, as soon as practicable after the date of such Section 13 Event and at its own expense, will:
(i) prepareandfile a registration statementpursuanttotheSecurities Act with respect totheRightsandthesecuritiespurchasableuponexerciseof theRightson anappropriate form,and useits best efforts to cause such registration statement to (x)become effective assoon aspracticable after suchfiling and(y) remain effective (with aprospectusatalltimesmeetingtherequirementsof theSecurities Act)untiltheExpirationDate,andsimilarlycomplywithapplicablestate securities laws;
(ii) useitsbest efforts to list (orcontinuethe listingof)theRightsandthesecuritiespurchasableuponexerciseof theRightsonanational securitiesexchange or to meetthe eligibility requirements forquotationon anational securitiesexchangeand to list (andcontinuethe listing of)theRightsandthe securitiespurchasableupon exerciseof theRightson anational securitiesexchange;
(iii) deliver toholdersof theRightshistorical financial statements forthe Principal Partyand its Affiliatesthatcomply inall respects withthe requirements for registrationon Form10 (orany successor form)promulgatedunderthe Exchange Act;and
(iv) takeallother action as maybenecessary toallow the Principal Party to issuethesecuritiespurchasableupon exerciseof the Rights.
(d) ProhibitedTransactions.
(i) Notwithstandinganythingtothecontrary inthisPlan, ifthePrincipal Partyhasaprovisioninanyofits authorizedsecuritiesorinitsorganizational documents thatwouldhave theeffectof(i)causingthePrincipal Party to issue(otherthantoholdersofRightspursuanttoSection13), inconnectionwith,or as aconsequence of,theconsummationof aSection13 Event,Common Sharesorcommonstockequivalents of the Principal Party at lessthan the thenCurrent Per Share Market Pricethereoforsecurities exercisable for,or convertibleinto,CommonSharesorcommonstockequivalents of thePrincipal Party at lessthan such Current Per Share Market Price;or(ii)providing forany specialpayment, tax, chargeor similarprovision inconnection withtheissuanceof theCommon Sharesof the Principal Partypursuant tothe provisions of thisSection13,then the Company hereby agrees with eachholderofRightsthatit willnotconsummate anysuchSection13Event unless priortheretothe Companyandsuch Principal Partyhave executedand deliveredtotheRightsAgent asupplementalagreementproviding thatsuchprovision has beencancelled,waived, amendedorrescinded,or thatsuchauthorizedsecurities willbe redeemed, sothat suchprovisionwillhave no effect inconnection with,or as aconsequence of,theconsummationof suchSection13 Event.
(ii) Notwithstandinganythingtothecontrary inthisPlan,the Companyhereby agrees with eachholderofRightsthatit willnotconsummateorpermit tooccurany Section13Event if(A) atthetimeorimmediately after suchSection13Event there areanyrights, warrants,instrumentsor securitiesoutstanding,oranyagreementsor arrangements,that, as a resultof theconsummationofsuchSection13 Event,would eliminateordiminish inanymaterial respectthebenefitsintendedtobe affordedby the Rights; (B)all rightsof first refusalorpreemptive rights in respectof theissuanceofCommonSharesor commonstockequivalents of the Principal Partyupon exerciseof outstandingRightshavenotbeen irrevocably waivedor renderedinapplicable;(C)priorto,simultaneouslywith orimmediatelyafter suchSection13 Event, the stockholders of the Person who constitutes, orwouldconstitute, the Principal Party have received a distribution ofRightspreviouslyowned by such Person oranyofitsAffiliates or Associates; or(D)the form ornatureof organization of the Principal Partywould precludeor limit theexercisabilityof the Rights.
(e) ContinuedApplicability.Theprovisions of thisSection13will similarlyapplyto successive mergers,consolidations,sales,exchanges,mortgages, transfersor otherextraordinarytransactions.Inthe event thataSection13Eventoccurs atanytime aftertheoccurrenceofaSection11(a)(ii)Event, then theRightsthat havenotpreviously been exercised will thereafterbecome exercisable inthemanner described inSection 13(a) (withouttaking into accountany prior adjustmentrequiredbySection 11(a)(ii)).
Section 14.Fractional Rights and Fractional Shares.
(a) Cash in Lieuof FractionalRights. TheCompany willnotbe required to issue fractionsofRights (exceptprior totheDistribution Date asprovidedinSection11(m))or todistribute Rights Certificates that evidence fractional Rights. In lieu of such fractional Rights, the Company will pay to the registered holders of the Rights Certificates with regard to which such fractional Rights would otherwise be issuable an amount in cash equal to the same fraction of the Current Per Share Market Price of a whole Right, calculated as of the Trading Day immediately prior to the date on which such fractional Rights would have been otherwise issuable.
(b) Cashin Lieuof FractionalPreferredShares.TheCompanywillnotberequired to issue fractionsofPreferred Shares(otherthanfractionsthatareintegralmultiples ofoneone-thousandth ofa Preferred Share)uponexerciseor exchange of theRightsortodistributecertificatesthat evidencefractional Preferred Shares(otherthan fractionsthat areintegralmultiples ofoneone-thousandth of a Preferred Share). Interests in fractionsof Preferred Shares inintegralmultiples ofoneone-thousandth ofa Preferred Share may, atthe election of the Company, be evidenced bydepositaryreceiptspursuantto anappropriateagreement betweenthe Companyandadepositaryselectedby the Company;provided,however,thatsuch agreement mustprovide that theholdersofsuchdepositaryreceiptshaveallof therights,privileges andpreferences to whichtheyareentitledasBeneficialOwnersof thePreferred Shares representedbysuchdepositaryreceipts.Inlieuoffractional Preferred Sharesthatarenotintegralmultiples ofoneone-thousandth ofa Preferred Share,the CompanymaypaytotheregisteredholdersofRightsCertificates atthetimethatsuchRightsare exercisedor exchangedasprovidedherein anamountin cashequal tothe same fractionof the current marketvalue ofoneone-thousandth of a Preferred Share. Forpurposesof thisSection 14(b),the current marketvalue ofoneone-thousandth of a Preferred Share willbeoneone-thousandth of the Current Per Share Market Priceof a Preferred Share,calculated asof theTrading Dayimmediately prior tothe date of such exerciseor exchange.
(c) Cashin Lieuof FractionalCommonShares.TheCompanyisnotrequired to issue fractionsofCommonSharesortodistributecertificatesthat evidencefractionalCommonSharesupontheexerciseor exchange of Rights.Inlieuofsuch fractionalCommonShares,the CompanymaypaytotheregisteredholdersofRights Certificates atthe time suchRights are exercisedor exchanged asprovided herein anamount in cashequal tothe same fractionof thecurrent marketvalue ofaCommonShare. Forpurposesof thisSection14(c),thecurrent marketvalue ofaCommonShare willbe theCurrent Per Share Market Priceof aCommon Share,calculated asof the Trading Dayimmediately prior tothe date of such exerciseor exchange.
(d) Waiverof FractionalRights. Except as permittedby thisSection14,theholderof aRight,by theacceptanceof suchRight, expressly waives such holder’sright to receiveany fractionalRightsorany fractional sharesofany securityuponthe exerciseor exchange of aRight.
(e) ProcedureforPayment.Wheneverapaymentfor fractionalRights,Preferred SharesorCommonShares is tobemadeby theRightsAgentpursuant tothis Plan,the Company will (i)promptly prepareanddeliver totheRights Agent a certificatesetting forth inreasonabledetail the facts related to suchpayment andthepricesorformulasutilizedincalculatingsuchpayments; and(ii)providesufficientmoniestotheRightsAgent to make suchpayments.TheRightsAgent willbefullyprotectedinrelyinguponsuch certificateandwillhave nodutywith respect theretoor the contentstherein, andwillnotbedeemed tohave knowledge ofany paymentfor fractionalRights,Preferred SharesorCommonSharespursuanttothisPlanunless anduntiltheRightsAgenthasreceived such certificateandsufficientmonies.
Section 15.Rights of Action. All rights of action in respect of this Plan, except those rights of action given to the Rights Agent pursuant to this Plan, are vested in the respective registered holders of the Rights Certificates (and, prior to the Distribution Date, the registered holders of Common Shares). Any registered holder of any Rights Certificate (or, prior to the Distribution Date, any registered holder of Common Shares), without the consent of the Rights Agent or of the holder of any other Rights Certificate (or, prior to the Distribution Date, any other holder of Common Shares), may, on such holder’s own behalf and for such holder’s own benefit and the benefit of other holders of Rights, enforce, and may institute and maintain any suit, action or proceeding against the Company to enforce, this Plan or otherwise act in respect of such holder’s right to exercise such holder’s Rights evidenced by such Rights Certificate in the manner provided in such Rights Certificate and in this Plan. 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 Plan and will be entitled to specific performance of the obligations of the Company, and injunctive relief against actual or threatened breaches or violations of this Plan by the Company, in each case without having to post a bond.
Section 16.Agreement of Rights Holders. Every holder of a Right, by accepting the same, consents and agrees with the Company and the Rights Agent and with every other holder of a Right that:
(a) prior totheDistribution Date,theRights willnotbe evidenced by aRights Certificateand willbe transferableonly inconnection withthetransferof theCommon Shares;
(b) aftertheDistribution Date,theRights Certificates are transferableonlyon the transferbooksof theRights Agent if surrendered atthe officeof theRightsAgentdesignatedfor suchpurpose,dulyendorsedoraccompaniedbyaproperinstrumentoftransferandwiththeappropriateformsandcertificates fullycompleted;
(c) subjecttoSection6(a)and Section7(f),the CompanyandtheRightsAgent maydeem andtreatthePerson in whose nametheRightsCertificate (or,prior totheDistribution Date,theassociated certificate forCommon SharesorBook Entry Shares, asapplicable) is registered asthe absoluteownerthereof andof theRightsevidencedthereby (notwithstanding anynotationsofownershiporwritingon theRightsCertificatesor theassociatedcertificate forCommonSharesorBookEntry Shares, asapplicable,madebyanyoneother than the Company or theRightsAgent)forall purposeswhatsoever,andneither the CompanynortheRights Agent (subject toSection 7(e)) willbe affectedbyanynotice tothe contrary;
(d) notwithstandinganything tothe contrary inthis Plan,neither the CompanynortheRights Agent willhaveanyliability toanyholderof aRight (or abeneficial interest in aRight)or other Person as a resultof the inability of the Company or theRights Agent to performanyoftheir respective obligations pursuant to this Plan by reason of any preliminary or permanent injunction or other order, judgment, decree or ruling (whether interlocutory or final) issued by a court of competent jurisdiction or by a governmental, regulatory, self-regulatory or administrative agency or commission, or any statute, rule, regulation or executive order promulgated or enacted by any governmental authority, prohibiting or otherwise restraining performance of such obligation;provided,however, that the Company will use all reasonable efforts to have any such injunction, order, judgment, decree or ruling lifted or otherwise overturned as promptly as practicable;
(e) Rightsthat areBeneficially Ownedby certain Persons will,underthe circumstances set forth inSection 7(e),becomenullandvoid;and
(f) this Plan maybesupplementedoramendedfrom time to time inaccordance withSection28.
Section 17.Holder of Rights Certificate Not Deemed to be a Stockholder. No holder, as such, of any Rights Certificate will be entitled to vote or receive dividends or be deemed for any purpose to be the holder of the number of one one-thousandths of a Preferred Share or any other securities of the Company that may at any time be issuable on the exercise or exchange of the Rights represented thereby, nor will anything contained herein or in any Rights Certificate be construed to confer upon the holder of any Rights Certificate, as such, any of the rights of a stockholder of the Company or any right to vote for the election of directors or upon any matter submitted to stockholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting stockholders (except as specifically provided in Section 26), or to receive dividends or subscription rights, or otherwise, until the Rights evidenced by such Rights Certificate have been exercised or exchanged in accordance with the provisions hereof.
Section 18.Concerning the Rights Agent.
(a) Compensation;Reimbursement;Indemnification.TheCompanyagrees topaytotheRightsAgentreasonable compensationforallservices renderedbyithereunderand,from time to time,ondemandby theRightsAgent,thereasonable anddocumentedout-of-pocket expenses andcounselfeesandotherdisbursements incurredby theRights Agent inconnection withthepreparation,negotiation,delivery,execution,amendment and administrationof this Planandthe exerciseand performanceofitsdutieshereunder,includingany taxesorgovernmental chargesimposedon it as a resultofanyactiontakenby itpursuant tothis Plan(otherthantaxes and governmental chargeson the feespayable to it). TheCompany also agrees toindemnifytheRights Agent for,and tohold it harmlessagainst, any loss,liability,damage,judgment, fine,penalty, claim,demand, settlement, costor expense (including thereasonable anddocumentedexpenses andfeesofitsoutsidecounsel)incurredwithoutgrossnegligence,badfaithorwillfulmisconducton thepartof theRightsAgent (which grossnegligence,badfaithorwillfulmisconductmustbedeterminedbya final,non-appealable judgment ofa courtofcompetentjurisdiction)foranyaction taken, sufferedoromitted tobetakenby theRights Agent inconnection withthe execution,acceptance, administration, exerciseand performanceofitsdutiespursuanttothisPlan,includingthecosts and expensesof defendingagainst any claimof liability.NotwithstandinganythingcontainedinthisPlan tothe contrary,theRight Agent’saggregateliabilityduring anytermof this Plan with respectto,arising from, or arising in connection with this Plan, or from all services provided or omitted to be provided under this Plan, whether in contract, tort or otherwise, is limited to, and shall not exceed, the amounts paid by the Company to the Rights Agent as fees and charges, but not including reimbursable expenses, during the 12 months immediately preceding the event for which recovery from the Rights Agent is being sought. In no event will the Rights Agent be liable for special, punitive, indirect, incidental or consequential loss or damage of any kind whatsoever (including lost profits), even if the Rights Agent has been advised of the possibility or likelihood of such loss or damage. The provisions of this Section 18 and Section 20 will survive the termination of this Plan, the exercise, exchange or expiration of the Rights and the resignation, replacement or removal of the Rights Agent.
(b) Reliance by the Rights Agent. TheRights Agent isauthorizedto relyconclusivelyon,andwillbeprotected andincur no liability for,or in respect of,anyaction taken, sufferedoromittedtobetakenbyit inconnection withits acceptance and administrationof this Plan,andthe exerciseand performanceofitsdutiespursuanttothisPlan, in relianceuponany(i)RightsCertificate; (ii) certificate (or registrationon thetransferbooksof the Company,including,inthecaseofuncertificated shares,bynotationinbookentryaccountsreflecting ownership) for Preferred Shares,CommonSharesor othersecuritiesof the Companyissuableuponexerciseof Rights; or(iii) instrumentofassignmentortransfer, powerofattorney, endorsement,affidavit, letter,notice,direction,consent,certificate, statementorotherpaper or documentreasonablybelieved byit,intheabsenceofgrossnegligence,badfaithorwillfulmisconduct(which grossnegligence,badfaithorwillfulmisconductmustbedeterminedbya final,non-appealable judgment ofa courtofcompetent jurisdiction),tobegenuineand tobedulyexecuted and, where necessary, verifiedor acknowledged, by theproper Person,or otherwiseuponthe advice of counsel as set forth inSection20.TheRightsAgent willnotberequired totake notice, or bedeemed tohaveanyknowledge, ofanyfact,event ordeterminationofwhich it wassupposedto receivenoticehereunder(includingany datesor eventsdefinedinthisPlanor the designation ofanyPerson as an Acquiring Personoran AffiliateorAssociateofan Acquiring Person),andtheRightsAgent willbefullyprotected andwillincur no liabilityforfailingtotake actioninconnectiontherewith,unless anduntilithasreceived suchnoticein writing.
Section 19.Merger, Consolidation or Change of Name of Rights Agent.
(a) MergerorConsolidationof Rights Agent.Any PersonintowhichtheRightsAgentoranysuccessorRightsAgent maybemergedorwith which it may effect a shareexchange or be consolidated, orany Personresulting fromany merger, shareexchange or consolidation to whichtheRights Agentorany successorRights Agent is aparty,orany Personsucceeding tothe corporate trust,stock transferor stockholder servicesbusinessof theRights Agentorany successorRightsAgent, willbe the successor totheRights Agentpursuant tothis Planwithout the execution orfilingofanypaper orany further acton thepartofanyof theparties hereto solongas such Person iseligibleforappointmentas a successorRightsAgentpursuanttothe provisions ofSection21.The purchaseofallor substantiallyallof theRightsAgent’s assetsemployedintheperformanceof thisPlan,ortransferorrightsagentservicesgenerally,willbe deemed tobe a merger, shareexchange or consolidation forpurposesof thisSection19.If atthe timethat such successorRights Agentsucceeds to the agency created by this Plan any of the Rights Certificates have been countersigned but not delivered, then any such successor Rights Agent may adopt the countersignature of any predecessor Rights Agent and deliver such Rights Certificates so countersigned, and if at that time any of the Rights Certificates have not been countersigned, then any successor Rights Agent may countersign such Rights Certificates either in the name of the predecessor Rights Agent or in the name of the successor Rights Agent. In all such cases, such Rights Certificates will have the full force and effect provided in the Rights Certificates and in this Plan.
(b) Changeof Nameof Rights Agent.If atany timethe nameof theRights Agent ischangedand at such timeanyof theRights Certificateshavebeen countersignedbut notdelivered,then theRightsAgent mayadoptthecountersignatureunderits priornameanddeliversuchRightsCertificates socountersigned,andif atanytimeanyof theRightsCertificateshavenothavebeencountersigned, then theRightsAgent maycountersignsuchRightsCertificateseither inits prior nameor initschanged name.Inall such cases, suchRights Certificates willhave the full forceand effectprovided intheRightsCertificatesandinthis Plan.
Section 20.Duties of Rights Agent. The Rights Agent undertakes to perform only the duties and obligations expressly imposed by this Plan (and no implied duties or obligations) upon the following terms and conditions, all of which the Company and the holders of Rights Certificates, by their acceptance thereof, will be bound:
(a) BeforetheRightsAgent actsorrefrains fromacting, theRightsAgent mayconsultwithlegalcounsel thatit selects (who maybelegalcounselforthe Company oranemployee of theRightsAgent),andthe advice oropinionofsuchcounselwillbefulland completeauthorizationand protection totheRightsAgent, andtheRights Agent willincur no liability foror in respect of,anyaction taken, sufferedoromitted tobetakenby it intheabsenceofgrossnegligence,badfaithorwillfulmisconduct(which grossnegligence,badfaithorwillfulmisconductmustbedeterminedbya final,non-appealable judgment of a courtofcompetentjurisdiction) inaccordance with suchadvice oropinion.
(b) WheneverintheperformanceofitsdutiespursuanttothisPlantheRightsAgent deems it necessaryordesirablethatanyfactormatter(including the identity ofany Acquiring Personandthedeterminationof the Current Per Share Market Priceofany security)beprovedorestablishedby the Companypriortotaking,sufferingor omittingtotakeanyactionhereunder,such factormatter (unlessother evidencein respectthereofis specifically prescribedherein)maybedeemed tobe conclusivelyproved and establishedbya certificatesignedbyanyoneof theChairmanof theBoard,Chief Executive Officer, President,ChiefFinancial Officer, Secretary, Assistant Secretaryorany Senior Vice Presidentof the Companyand delivered totheRightsAgent, and such certificate willbe fulland completeauthorizationand protection totheRightsAgent, andtheRights Agent willincur no liability foror in respectofanyaction taken, sufferedoromitted tobetaken intheabsenceof grossnegligence,bad faithor willfulmisconduct (which grossnegligence,badfaithor willfulmisconduct mustbe determinedby a final,non-appealable judgment of a courtofcompetentjurisdiction) by itpursuant tothe provisions of thisPlan in relianceuponsuch certificate.
(c) TheRights Agent willnotbe liablehereunder foror by reasonofanyof thestatementsof factor recitalscontained inthis Plan,theRightsCertificatesorany certificate (or registrationon the transferbooksof the Company,including, inthe caseof uncertificated shares,bynotation inbook entryaccounts reflecting ownership) for Preferred Shares,Common Sharesor other securitiesof the Companyissuableupon exerciseof Rights, or be required to verifythesame(except,in each case,its countersignaturethereof, ifapplicable), and allsuchstatements andrecitals areandwillbedeemed tohavebeenmadeby the Companyonly.
(d) TheRights Agent willnot (i)haveanyliability foror beunderany responsibility in respectof the validity of this Planor the executionand deliveryhereof (exceptthedueauthorization, executionand deliveryhereofby theRightsAgent)orin respectof the validity or execution ofanyRightsCertificate (exceptits countersignaturethereof)oranycertificate (or registrationon thetransferbooksof the Company,including,inthecaseofuncertificated shares,bynotationinbookentryaccountsreflecting ownership) for Preferred Shares,CommonSharesor othersecuritiesof the Companyissuableupon exerciseofRights(except, in each case,its countersignature thereof, ifapplicable); (ii)beresponsible foranychange intheexercisabilityor exchangeability ofRights(includingcertainRightsbecomingnullandvoidpursuanttoSection7(e)),exceptwith respect totheexerciseofRightsevidenced byRights Certificates afternotice of suchchangehas beenprovided by the Company; (iii)beresponsible forany breachby the Company ofanycovenant orfailureby the Companyto satisfyanyconditioncontainedinthisPlanoranyRightsCertificate; (iv)beresponsiblefor(A)any adjustmentor changerequiredpursuanttoSection3,Section11,Section13,Section23 orSection24;(B)themanner,methodor amount ofanysuchadjustmentor change; or (C)ascertainingtheexistenceof factsthatwould requireany suchadjustmentor change (except with respect tothe exerciseofRightsevidenced byRightsCertificates after receiptby theRightsAgentofa certificate furnishedpursuanttoSection12describingsuchadjustmentorchange);(v)beresponsibleforany determinationby theBoardof theCurrent Per Share Market PriceofanysecuritypursuanttothisPlan;or(vi)byanyacthereunderbedeemed to makeanyrepresentationorwarranty as tothe authorization orreservationofanysecurities tobeissuedpursuanttothisPlanoranyRightsCertificateor as towhether any such securities will, whenissued,bedulyandvalidlyauthorized and issuedand fullypaidand nonassessable.
(e) TheCompanyagreesthatit will perform,execute, acknowledgeand deliver,orcause tobeperformed,executed, acknowledgedand delivered, all such furtherandother acts,instruments and assurances as mayreasonablybe requiredby theRights Agent forthe carryingoutor performingby theRights Agentofitsdutiespursuant tothis Plan.
(f) TheRightsAgent is herebyauthorized anddirected toacceptinstructionswith respect totheperformanceofitsdutieshereunderfromanyof theChairmanof theBoard,Chief ExecutiveOfficer, President,ChiefFinancialOfficer, Secretary, Assistant Secretaryorany SeniorVice Presidentof the Company,andit isauthorizedtoapplytoanysuchdirectororofficer foradvice or instructionsinconnectionwithitsdutiespursuanttothisPlan. Suchadviceandinstructions willbe fulland completeauthorizationand protection totheRightsAgent, andtheRights Agent willnotbe liable foror in respectofanyaction taken, sufferedoromitted tobetakenby it inaccordance withthe writtenadvice or instructions ofany suchdirectoror officeror forany delay inacting whilewaiting for those instructions, in each case in the absence of its own gross negligence, bad faith or willful misconduct (which gross negligence, bad faith or willful misconduct must be determined by a final, non-appealable judgment of a court of competent jurisdiction). The Rights Agent will be fully and completely authorized and protected in relying on the latest-dated instructions received from any such director or officer. Any application by the Rights Agent for written instructions from the Company may, at the option of the Rights Agent, set forth in writing any action proposed to be taken, suffered or omitted to be taken by the Rights Agent pursuant to this Plan and the date on or after which such action will be taken, suffered or omitted to be taken. The Rights Agent will not be liable for any action taken or suffered by, or omission of, the Rights Agent in accordance with a proposal included in any such application on or after (but not including) the date specified in such application (which date must not be less than five Business Days after, but not including, the date on which any such director or officer of the Company actually receives such application, unless any such director or officer has consented in writing to an earlier date) unless, prior to taking or suffering any such action (or the effective date in the case of an omission), the Rights Agent has received, in response to such application, written instructions with respect to the proposed action or omission specifying a different action to be taken, suffered or omitted to be taken.
(g) Inthe event that theRights Agentbelievesanyambiguity oruncertainty existsunderthis Planor inanynotice, instruction,direction, requestor other communication, paper or documentreceivedby theRightsAgentunderthisPlan,theRightsAgent,may, inits sole discretion,refrain fromtakinganyaction,and shallbe fullyprotected and shallnotbe liable inany way toCompany, theholderofanyRights CertificateorBook Entry Sharesoranyotherperson for refraining fromtaking suchaction,unlesstheRights Agent receives writteninstructionssignedby the Company thateliminates suchambiguity oruncertaintytothesatisfactionof theRightsAgent.
(h) TheRightsAgentand anymember,stockholder,director, officer,employee orAffiliateof theRightsAgent (in each case,other thanan Acquiring Person) maybuy, sellordeal inanyof theRightsor other securitiesof the Company orbecome pecuniarily interested inany transaction in whichthe Company maybeinterested,orcontract withor lendmoney tothe Company or otherwise act as fullyand freely asthough it werenottheRights Agentpursuant tothis Plan.Nothing herein willprecludetheRights Agentorany such member,stockholder, director, officer,employee or Affiliate fromacting inanyothercapacityforthe Company or foranyother Person.
(i) TheRightsAgent mayexecuteandexerciseanyof therightsorpowers herebyvestedin itorperformanydutyhereundereitheritself(including throughits directors, officersand employees)or by or throughits attorneysoragents, andtheRights Agent willnotbe answerableor accountableforany act,omission, default,neglect ormisconductofany suchattorneysor agents or forany loss tothe Company, totheholdersofRightsor toanyotherPersonresultingfromanysuch act,omission, default,neglect ormisconductintheabsenceofgrossnegligence,badfaithorwillfulmisconductintheselection andcontinuedemployment thereof(which grossnegligence,badfaithorwillfulmisconductmustbedeterminedbya final,non-appealable judgment ofa courtofcompetent jurisdiction).
(j) Noprovisionof thisPlan requirestheRightsAgent toexpend orriskitsownfundsorotherwiseincurany financialliabilityintheperformanceofanyofitsdutieshereunder (otherthancosts and expenses incurredby theRights Agent inproviding services tothe Company inthe ordinary courseofits businessastheRightsAgentandfor whichtheRightsAgentshallbecompensated pursuanttoSection18)orintheexerciseofits rightsif itreasonablybelieves that repaymentof suchfundsor adequateindemnification against such riskor liability isnotreasonably assured toit.
(k) If,with respect toanyRightsCertificate surrendered totheRightsAgent for exerciseortransfer,thecertificatecontainedintheformof election to purchaseor formofassignment, asthe case maybe, haseither (i)notbeen properlycompletedor (ii)indicates an affirmative response toclause (1)orclause (2) thereof,then theRights Agent willnottakeany furtheraction with respect to such requested exerciseor transferwithout firstconsulting withthe Company;provided,however,that theRights Agentshallnotbe liable foranydelays arising fromthe dutiesunderthisSection 20(k).
(l) From time to time aftertheDistributionDate,uponthewritten requestof the Company, theRightsAgent willpromptlydelivertothe Company alist, asof the most recentpracticabledate (or asof such earlierdate as maybe specifiedby theCompany),of the recordholdersofRightsandRights Certificates.
(m) TheRights Agent willnotbe required totake notice or be deemed tohave notice ofany fact,event ordetermination(includingany datesor eventsdefined inthis Planor the designation ofany Person as an Acquiring Personor an Affiliateor Associateof an Acquiring Person)pursuant tothis Planunless anduntiltheRightsAgent is specificallynotifiedin writingofsuch fact,event ordeterminationby the Company or byreceiptofa properlycompleted anddulyexecutedRights Certificate (and formof election to purchaseor formof assignment).
(n) TheRightsAgent may relyonandbefullyauthorized and protectedinacting orfailingto actupon(i)any guarantyofsignaturebyan“eligible guarantor institution” that is a memberorparticipant inthe Securities TransferAgentsMedallion Programor othercomparable “signature guaranteeprogram”orinsuranceprogram inadditionto, orinsubstitutionfor,theforegoing;or(ii)anylaw, act,regulationorany interpretationof thesameeventhough such law, actorregulationmay thereafterhavebeen altered,changed,amendedorrepealed.
(o) TheRights Agentshallnotbe liable orresponsible forany failureof the Company tocomply withanyofitsobligationsrelating toanyregistration statement filed withthe SecuritiesandExchange Commissionor this Plan,including obligations underapplicableregulationor law.
Section 21.Change of Rights Agent. The Rights Agent or any successor Rights Agent may resign and be discharged from its duties pursuant to this Plan upon 30 days’ written notice to the Company (or such lesser notice as is acceptable to the Company) and to each transfer agent of the Preferred Shares and the Common Shares (in the event that the Rights Agent or one of its Affiliates is not also such transfer agent), delivered to the Company in accordance with Section 27. In the event that any transfer agency relationship in effect between the Company and the Rights Agent or any of its Affiliates terminates, the Rights Agent will be deemed to have automatically resigned, and be discharged from its duties pursuant to this Plan, on the effective date of such termination, and the Company will be responsible for sending any required notices. The Company may remove the Rights Agent or any successor Rights Agent, with or without cause, upon 30 days’ notice in writing to the Rights Agent or any successor Rights Agent, as the case may be, and to each transfer agent of the Preferred Shares and the Common Shares (in the event that the Rights Agent or one of its Affiliates is not also such transfer agent), delivered to the Rights Agent in accordance with Section 27. If the Rights Agent resigns or is removed or otherwise becomes incapable of acting, then the resigning, removed or incapacitated Rights Agent must remit to the Company, or to any successor Rights Agent, all books, records, funds (other than any funds owed to the Rights Agent or its Affiliates under this Plan or under any other agreement or arrangement with the Company or its Affiliates), certificates or other documents or instruments of any kind then in its possession that were acquired by such resigning, removed or incapacitated Rights Agent in connection with its services as the Rights Agent;provided,however, that the Rights Agent may keep copies of same in accordance with applicable law or its document retention policies or conventions. Following such removal, resignation or incapacity of the Rights Agent, the Company will appoint a successor to the Rights Agent. If the Company fails to make such appointment within a period of 30 days after giving written 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 registered holder of a Rights Certificate (who must, together with such notice, submit such registered holder’s Rights Certificate for inspection by the Company), then such registered holder or the incumbent Rights Agent may apply, at the Company’s expense, to a court of competent jurisdiction for the appointment of a new Rights Agent. Any successor Rights Agent, whether appointed by the Company or by such court, must be either (a) a Person organized, in good standing and doing business pursuant to the laws of the United States or any state of the United States that is authorized pursuant to such laws to exercise corporate trust, stock transfer or stockholder services, is subject to supervision or examination by federal or state authorities and has at the time of its appointment as Rights Agent a combined capital and surplus of at least $50,000,000 or (b) an Affiliate or direct or indirect wholly owned Subsidiary of such Person. After appointment, the successor Rights Agent will 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, and the predecessor Rights Agent must 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 such purpose, but such predecessor Rights Agent shall not be required to make any additional expenditure or assume any additional liability in connection with the foregoing. Not later than the effective date of any such appointment, the Company will file notice thereof in writing with the predecessor Rights Agent and each transfer agent of the Preferred Shares and the Common Shares (in the event that the Rights Agent or one of its Affiliates is not also such transfer agent), and deliver such notice to the holders of Rights Certificates in accordance with Section 27. Notwithstanding anything to the contrary in this Plan, failure to give any notice provided for in this Section 21, or any defect therein, will 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. Upon appointment, any successor Rights Agent will, unless the context requires otherwise, be deemed to be the Rights Agent for all purposes of this Plan.
Section 22.Issuance of New Rights Certificates. Notwithstanding anything to the contrary in this Plan or the Rights, the Company may, at its option, issue new Rights Certificates evidencing Rights in such form as may be approved by the Board to reflect any adjustment or change in the Exercise Price and the number or kind or class of shares or other securities or property purchasable pursuant to the Rights Certificates made in accordance with the provisions of this Plan. In addition, in connection with the issuance or sale of Common Shares following the Distribution Date and prior to the Expiration Date, the Company will, with respect to Common Shares so issued or sold (whether pursuant to the exercise of stock options or pursuant to any employee benefit plan or arrangement or upon the exercise, conversion or exchange of other securities of the Company outstanding as of the Rights Dividend Declaration Date or upon the exercise, conversion or exchange of securities issued by the Company after the Rights Dividend Declaration Date (except, in each case, as may otherwise be provided in the instruments governing such securities)), and may, in any other case, if deemed necessary or appropriate by the Board, issue Rights Certificates representing the appropriate number of Rights in connection with such issuance or sale;provided,however, that (a) no such Rights Certificate will be issued if, and to the extent that, the Company is advised by counsel that such issuance would create a significant risk of or result in material adverse tax consequences to the Company or the Person to whom such Rights Certificate would be issued or would create a significant risk of or result in such options or employee plans or arrangements failing to qualify for otherwise available special tax treatment; (b) no such Rights Certificate will be issued if, and to the extent that, appropriate adjustment will otherwise have been made in lieu of the issuance thereof; and (c) the Company will have no obligation to distribute Rights Certificates to any Acquiring Person, Affiliate or Associate of an Acquiring Person, Post-Event Transferee, Pre-Event Transferee, Subsequent Transferee or any nominee of any of the foregoing.
Section 23.Redemption.
(a) Rightto Redeem. The Board may, atitsoption,atanytimepriortotheearlierof(i)theDistributionDateor(ii)theCloseofBusinesson theFinalExpirationDate, redeemallbut notlessthanallof the then outstandingRightsat aredemptionpriceof$0.01 perRight,as suchamountmaybeappropriately adjustedto reflectany stock split, stockdividend,recapitalizationorsimilartransactionoccurring aftertheRightsDividendDeclaration Date (suchredemptionprice,the“Redemption Price”).Notwithstandinganythingtothecontrary inthisPlan,theRightswillnotbeexercisable afterthefirst occurrenceofaSection11(a)(ii)Eventuntilsuch time astheCompany’s rightofredemption pursuanttothisSection23has expired.TheCompanymay, atitsoption,paythe RedemptionPrice inCommonShares (basedon theCurrent Per Share Market PriceofCommonShares atthetimeofredemption), cashoranyother formofconsideration deemedappropriateby theBoard, inits sole discretion, tobe at leastequivalent tothe Redemption Price. Suchredemptionof theRightsby the Board maybe made effective at such time,on suchbasis and with suchconditions asthe Board inits sole discretion mayestablish. Thedate on whichthe Boardelects to maketheredemption effective is referred to asthe “Redemption Date.”
(b) GeneralRedemption Procedures. Immediatelyuponthe action of the Board orderingtheredemptionof theRights (or at suchlater time astheBoard mayestablish forthe effectivenessof such redemption),evidence of which willhavebeen filed withtheRightsAgent, andwithout any further action and without any notice, the right to exercise the Rights will terminate and the only right thereafter of the holders of Rights will be to receive the Redemption Price for each Right so held. The Company will promptly give public notice of any such redemption (with prompt written notice thereof also provided to the Rights Agent). Promptly after the action of the Board ordering the redemption of the Rights, the Company will give, or cause to be given, notice of such redemption to the holders of Rights Certificates in accordance with Section 27;provided,however, that any notice that is so provided will be deemed given, whether or not the holder receives the notice. Each such notice of redemption must state the method by which the payment of the Redemption Price is to be made. The failure to give, or any defect in, any notice required by this Section 23 will not affect the legality or validity of the action taken by the Board or of the redemption.
(c) Dischargeof Obligations.Notwithstandinganythingtothecontrary inthisPlan, inthe event ofaredemption pursuanttoSection23(a),the Company may, atitsoption,discharge allofitsobligations with respect totheRightsby (i)issuing a press releaseormaking apublicly-availablefiling withtheSecuritiesandExchangeCommissionannouncingthemannerofredemptionof theRightsand(ii)mailing paymentof the RedemptionPrice totheholdersofRights atthe addressesof suchholders as shownon the transferbooksof theRights Agent or,prior totheDistribution Date,on the transferbooksof the Company or thetransferagentfortheCommonShares,anduponsuchaction,alloutstandingRightsCertificates willbenullandvoidwithoutanyfurtheraction by the Company.
(d) Prohibited Purchases.Notwithstandinganything tothe contrary inthis Plan,neither the Companynoranyofits Affiliatesor Associates may redeem,acquireorpurchase forvalueanyRightsatanytime inany mannerother thanas specifically set forth inthisSection23 orinSection24,or other than inconnection withthe purchaseor repurchaseofCommonSharesprior totheDistributionDate.
Section 24.Exchange.
(a) Exchange of CommonShares forRights. The Board may, atitsoption, atany time afterany Personbecomes an Acquiring Person,exchangeallorpartof the then outstandingandexercisableRights(which willnot include Rightsthat havebecomenullandvoidpursuanttothe provisions ofSection7(e)) forCommonShares at anexchangeratioofoneCommonShareperRight,appropriately adjustedto reflectany stock split, stockdividend,recapitalizationorsimilartransactionoccurring aftertheRightsDividendDeclaration Date (suchexchangeratio,the“ExchangeRatio,”andsuchdeterminationby the Board to effect suchexchange, an“Exchange Determination”).Notwithstandingtheforegoing,the Board isnot empowered to effect anExchange Determination atany time afterany Person(otherthanany Exempt Person),together withall Affiliatesand Associatesof such Person,becomestheBeneficial Ownerof50%or moreof theCommonSharesthenoutstanding.Notwithstandingtheforegoing, fromand afterthe occurrenceof aSection13 Event,anyRightsthat theretoforehavenotbeenexchangedpursuant tothisSection 24(a) will thereafterbe exercisableonly inaccordance withSection13and maynotbe exchanged (oreligible forexchange)pursuant tothisSection 24(a).
(b) Exchange Procedures.
(i) ImmediatelyfollowinganExchangeDeterminationandwithoutanyfurtheraction or notice, therightto exercise suchRightswill terminateandtheonlyrightthereafterofaholderofsuchRightsis to receivethat number ofCommonSharesequaltothe number ofsuchRightsheld bysuchholdermultiplied by the Exchange Ratio. TheCompany willpromptlygive publicnotice ofanysuchexchange (with prompt writtennoticethereof alsoprovided totheRights Agent),and thereafter willpromptlygive, or cause tobegiven,notice of suchexchangetotheholdersof the then outstandingRights(otherthanRightsthat havebecomenullandvoidpursuanttothe provisions ofSection7(e))bymailingsuchnotice,inaccordancewithSection27;provided,however,thatanynotice thatis soprovidedwillbedeemedgiven,whetherornottheholderreceivesthe notice.Each suchnotice of exchangemust statethemethodbywhichthe exchange ofCommonShares forRightsis tobeeffected(including the actions thatmustbetakenby theholdersofRightsto receiveCommonShares inexchangeforRights) and,inthe event ofanypartialexchange, the number ofRightsthatare tobe exchanged.Any partialexchangewillbeeffected pro rata basedon the number ofRights(otherthanRightsthat havebecomenullandvoidpursuanttothe provisions ofSection 7(e))held by eachholderof Rights.Following anExchange Determination,the Company mayimplement such procedures as it deemsappropriate, inits sole discretion,tominimizethe possibility thatany Common Shares (orother consideration)issuable pursuant tothisSection24 are receivedby Persons whoseRightsarenullandvoidpursuanttoSection7(e). Prior to effectinganyexchange, the Companymay require,orcausethetrusteeof theTrust to require, as aconditionthereof,thatanyregisteredholderofRightsprovidesuchevidence (including the identity of theBeneficialOwner (or formerBeneficial Owner)thereof andthe Affiliatesor Associatesof suchBeneficial OwnerorformerBeneficial Owner) asthe Companymayreasonably request in order to determine if suchRightsarenullandvoidpursuanttoSection7(e).Ifsuch registeredholderdoesnotcomplywiththeforegoingrequirements,then the Companywillbe entitledtoconclusivelydeemsuchRightstobeBeneficiallyOwnedbyan Acquiring Person (or an AffiliateorAssociateofan Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, aSubsequentTransfereeoranynominee ofanyof theforegoing)and, accordingly,suchRightswillbenullandvoidandnotexchangeableinconnectionherewith. AnyCommonShares (orothersecurities) issued atthedirectionof theBoard inconnectionwith anExchangeDetermination willbedulyandvalidlyauthorized andissuedandfullypaidand nonassessable, andthe Companywillbedeemed tohave received asconsideration for suchissuance abenefithaving avalue that is at leastequal totheaggregate parvalue of theCommon Shares (orothersecurities) soissued.The failure togive, oranydefectin,anynoticerequiredby thisSection24willnotaffectthe legality or validity of the actiontakenby theBoardor ofsuchexchange.
(ii) Theexchange of theRightspursuanttoSection24(a) maybemade effective at such time,onsuchbasis andwith suchconditionsastheBoard, inits sole discretion, mayestablish.Without limiting theforegoing, prior to effecting anexchangepursuant toSection 24(a),the Board may directthe Companytoenterintoa trust agreement in such formandwith such terms astheBoardapproves(the “Trust Agreement”).IftheBoard so directs,then the Companymustenterinto theTrust Agreementandmust issue tothetrust createdbysuch agreement (the “Trust”)allof theCommonShares (orother consideration)issuable pursuanttothe exchange(or any portion thereof that has not theretofore been issued in connection with the exchange). From and after the time at which such Common Shares (or other consideration) are issued to the Trust, all stockholders then entitled to receive Common Shares (or other consideration) pursuant to the exchange will be entitled to receive such shares or consideration (and any dividends or distributions made thereon after the date on which such shares or consideration are deposited into the Trust) only from the Trust and solely upon compliance with the relevant terms and provisions of the Trust Agreement.
(c) Insufficient Shares.Inthe event that there arenot sufficientCommon Shares issuedbut notoutstanding orauthorizedbutunissued to permitanyexchange ofRightsascontemplatedinaccordancewithSection24(a),then the Companywilleither takesuchactionas maybenecessary toauthorizeadditionalCommon Shares forissuanceuponexchange of theRightsoralternatively, attheoptionof theBoard,with respect to eachRight (i)pay cash in anamount equaltotheCurrentExchangeValue inlieuofissuing CommonShares inexchangetherefor; (ii) issuedebt or equitysecurities (or acombinationthereof)havingavalue equaltotheCurrentExchangeValue inlieuofissuing CommonShares inexchangefor each suchRight,wherethe value ofsuch securities willbedeterminedby theBoard baseduponthe advice ofanationallyrecognized investmentbankingfirm selectedby theBoard,whichdetermination willbe described in a written statement filed withtheRights Agentandwillbebindingon theRights Agentandtheholdersof Rights; or(iii)deliveranycombination of cash,property, CommonShares, Preferred Shares, Equivalent Shares or other securitieshavinga value equal to the Current Exchange Value in exchange for eachRight.To the extent that the Company determines that some actionneedbetaken pursuantto thisSection24(c), then the Board may temporarilysuspendtheexercisabilityof theRightsfor aperiodof up to120daysfollowingthe date on which the Exchange Determinationhasoccurred in order to seekanyauthorization ofadditionalCommonShares or to decide theappropriateform of distribution to be madepursuantto theaboveprovision andto determine the value thereof. Uponanysuch suspension, the Company will issue apublicannouncement stating,and notifytheRightsAgent in writing, that theexercisabilityof theRightshas beentemporarily suspended, as well as issue apublicannouncement,and notifytheRightsAgent in writing, at such time as thesuspensionis nolongerin effect.
(d) Cashin Lieuof FractionalCommonShares.Inconnectionwith anExchangeDetermination,the Companywillnotberequired to issue fractionsofCommonSharesortodistributecertificatesthat evidencefractionalCommonShares.Inlieuofsuch fractionalCommonShares,the Companymaypay tothe registeredholdersofRights Certificates with regard to which such fractionalCommon Shareswould otherwisebeissuable anamount in cashequaltothesame fractionof theCurrent Per Share Market PriceofaCommonShare,calculatedasof theTrading Dayimmediately priortothe date of the Exchange Determination
Section 25.Process to Seek Exemption Prior to Trigger Event.
(a) Waiver Prior to aStock Acquisition Date. Any Person who desires to effectanyacquisition ofCommon Stockthatwould, ifconsummated,result in such Personbeneficially owning 4.9%or moreof the then outstandingCommon Shares(a “Requesting Person”) may,priorto the Stock Acquisition Date and in accordance with this Section 25(a), request that the Board grant an exemption with respect to such acquisition under this Plan so that such Person would be deemed to be an “Exempt Person” under subsection (ii) of Section 1(u) for purposes of this Plan (an “Exemption Request”). An Exemption Request must be in proper form and must be delivered by overnight delivery service or first-class mail, postage prepaid, to the Secretary of the Company at the principal executive office of the Company. The Exemption Request must be deemed made upon receipt by the Secretary of the Company. To be in proper form, an Exemption Request must set forth (i) the name and address of the Requesting Person, (ii) the number and percentage of Common Shares then Beneficially Owned by the Requesting Person, together with all Affiliates and Associates of the Requesting Person, and (iii) a reasonably detailed description of the transaction or transactions by which the Requesting Person would propose to acquire Beneficial Ownership of Common Shares aggregating 4.9% or more of the then outstanding Common Shares and the maximum number and percentage of shares of Common Shares that the Requesting Person proposes to acquire. The Board will make a determination whether to grant an exemption in response to an Exemption Request as promptly as practicable (and, in any event, within ten (10) Business Days) after receipt thereof;provided,however, that the failure of the Board to make a determination within such period will be deemed to constitute the denial by the Board of the Exemption Request. The Requesting Person must respond promptly to reasonable and appropriate requests for additional information from the Board and its advisors to assist the Board in making its determination.
For purposes of considering the Exemption Request, any calculation of the number of Common Shares outstanding at any particular time, including for purposes of determining the particular percentage of such outstanding Common Shares of which any Person is the Beneficial Owner, will be made pursuant to and in accordance with Section 382. The Board will only grant an exemption in response to an Exemption Request if the Board determines in its sole discretion that the acquisition of Beneficial Ownership of Common Shares by the Requesting Person (A) will not adversely impact in any material respect the time period in which the Company could use the Tax Benefits or limit or impair the availability to the Company of the Tax Benefits; or (B) is in the best interests of the Company despite the fact that it may adversely impact in a material respect the time period in which the Company could use the Tax Benefits or limit or impair the availability to the Company of the Tax Benefits. Any exemption granted hereunder may be granted in whole or in part, and may be subject to limitations or conditions (including a requirement that the Requesting Person agree that it will not acquire Beneficial Ownership of Common Shares in excess of the maximum number and percentage of shares approved by the Board), in each case as and to the extent the Board determines necessary or desirable to provide for the protection of the Tax Benefits. Any Exemption Request may be submitted on a confidential basis and, except to the extent required by applicable law, the Company will maintain the confidentiality of such Exemption Request and the Board’s determination with respect thereto, unless the information contained in the Exemption Request or the Board’s determination with respect thereto otherwise becomes publicly available. The Exemption Request will be considered and evaluated by directors serving on the Board who are independent of the Company and the Requesting Person and disinterested with respect to the Exemption Request, and the action of a majority of such independent and disinterested directors will be deemed to be the determination of the Board for purposes of such Exemption Request.
(b) WaiverSubsequent toStock Acquisition Date. The Board may,ofits own accordoruponthe requestof astockholder(a“Waiver Request”),subsequentto a StockAcquisitionDateand priortotheDistributionDate,and inaccordance with this Section 25(b), grant an exemption with respect to any Acquiring Person under this Plan so that such Acquiring Person would be deemed to be an “Exempt Person” under subsection (ii) of Section 1(u) for purposes of this Plan. A Waiver Request must be in proper form and must be delivered by overnight delivery service or first-class mail, postage prepaid, to the Secretary of the Company at the principal executive office of the Company. The Waiver Request will be deemed made upon receipt by the Secretary of the Company. To be in proper form, a Waiver Request must set forth (i) the name and address of the Acquiring Person, (ii) the number and percentage of Common Shares then Beneficially Owned by the Acquiring Person, together with all Affiliates and Associates of the Acquiring Person, and (iii) a reasonably detailed description of the transaction or transactions by which the Acquiring Person acquired Beneficial Ownership of Common Shares aggregating 4.9% or more of the then outstanding Common Stock and the maximum number and percentage of Common Shares that the Acquiring Person proposes to acquire. The Board will make a determination whether to grant an exemption in response to a Waiver Request as promptly as practicable (and, in any event, within 10 Business Days) after receipt thereof;provided,however, that the failure of the Board to make a determination within such period will be deemed to constitute the denial by the Board of the Waiver Request. The Acquiring Person must respond promptly to reasonable and appropriate requests for additional information from the Board and its advisors to assist the Board in making its determination. For purposes of considering the Waiver Request, any calculation of the number of Common Shares outstanding at any particular time, including for purposes of determining the particular percentage of such outstanding Common Shares of which any Person is the Beneficial Owner, will be made pursuant to and in accordance with Section 382. The Board will only grant an exemption for an Acquiring Person if the Board determines in its sole discretion that the acquisition of Beneficial Ownership of Common Stock by such Acquiring Person does not adversely impact in any material respect the time period in which the Company could use the Tax Benefits or limit or impair the availability to the Company of the Tax Benefits. Any exemption granted hereunder may be granted in whole or in part, and may be subject to limitations or conditions (including a requirement that such Acquiring Person agree that it will not acquire Beneficial Ownership of Common Shares in excess of the maximum number and percentage of shares approved by the Board), in each case as and to the extent the Board determines necessary or desirable to provide for the protection of the Tax Benefits. The facts and circumstances with respect to the Triggering Event, including whether to grant an exemption, will be considered and evaluated by directors serving on the Board, or a duly constituted committee thereof, who are independent of the Company and such Acquiring Person and disinterested with respect to the Triggering Event, and the action of a majority of such independent and disinterested directors will be deemed to be the determination of the Board for purposes of any exemption granted pursuant to this Section 25(b).
Section 26.Notice of Certain Events.
(a) Certain Distributions.Ifthe Companyproposes, atany time aftertheDistribution Date, to (i) declareorpay anydividendpayable instockofany class totheholdersof Preferred Sharesor to makeanyother distribution totheholdersof Preferred Shares(otherthan aregular quarterlyorperiodic cashdividend outofearningsorretainedearningsof theCompany);(ii) offer totheholdersofPreferred Sharesrightsorwarrants to subscribe fororto purchaseanyadditional Preferred Shares or shares of stock of any class or any other securities, rights or options; (iii) effect any reclassification of the Preferred Shares (other than a reclassification involving only the subdivision of outstanding Preferred Shares); (iv) effect any share exchange, consolidation or merger into or with any other Person (other than a wholly owned Subsidiary of the Company in a transaction that complies with Section 11(l)); (v) effect any sale or other transfer (or permit one or more of its Subsidiaries to effect any sale or other transfer), in one transaction or a series of related transactions, of more than 50% of the assets, cash flow or earning power of the Company and its Subsidiaries (taken as a whole) to any other Person; (vi) effect the liquidation, dissolution or winding up of the Company; (vii) declare or pay any dividend on the Common Shares payable in Common Shares; or (viii) effect a subdivision, combination or consolidation of the Common Shares (by reclassification or otherwise than by payment of dividends in Common Shares), then, in each such case, the Company will give written notice of such proposed action to the Rights Agent and the holders of Rights Certificates in accordance with Section 27, which notice must specify the record date for the purposes of such stock dividend, distribution of rights or warrants, or the date on which such subdivision, combination, reclassification, share exchange, consolidation, merger, sale, transfer, liquidation, dissolution or winding up is to take place and the date of participation therein by the holders of Preferred Shares or Common Shares, if any such date is to be fixed, and such notice must be so given in the case of any action covered by clause (i) or (ii) above at least 10 Business Days prior to but not including the record date for determining holders of Preferred Shares for purposes of such action, and in the case of any such other action, at least 10 Business Days prior to but not including the date of the taking of such proposed action or the date of participation therein by the holders of Preferred Shares or Common Shares, whichever is earlier.
(b) Certain Events.Ifany TriggeringEvent has occurred,then (i)the Company will assoon aspracticable thereaftergive, or cause tobegiven, to eachholderofRights Certificates anotice inaccordance withSection27 of the occurrenceof such TriggeringEvent, whichnotice must specifythe eventandthe consequences of the event toholdersofRightspursuant toSection 11(a)(ii)orSection13;and (ii)all references inthisSection26 to Preferred Shares will thereafterbe deemed tobe references toCommon Shares or, ifappropriate,other securities.
Section 27.Notices. Notices or demands authorized by this Plan to be given or made by the Rights Agent or by the holder of any Rights Certificate (or, prior to the Distribution Date, of any Common Share) to or on the Company will be sufficiently given or made if in writing and when sent by a recognized national overnight delivery service or first-class mail, postage prepaid, addressed (in each case, until another address is filed in writing with the Rights Agent by the Company) as follows:
Aviat Networks, Inc.
200C Parker Dr. Suite 100A Austin
Texas 78728
Attn: Erin Boase, Vice President, Legal Affairs
Subject to the provisions of Section 21, any notice or demand authorized by this Plan to be given or made by the Company or by the holder of any Rights Certificate (or, prior to the Distribution Date, of any Common Share) to or on the Rights Agent will be sufficiently given or made if in writing and sent by a recognized national overnight delivery service or first-class mail, postage prepaid, addressed (in each case, until another address is filed in writing with the Company by the Rights Agent) as follows:
Computershare Inc.
150 Royall Street
Canton, MA 02021
Attn: Client Services
Notices or demands authorized by this Plan to be given or made by the Company or the Rights Agent to the holders of Rights or Rights Certificates (or, if prior to the Distribution Date, to the holders of Common Shares) will be sufficiently given or made if in writing and when sent by a recognized national overnight delivery service or first-class mail, postage prepaid, addressed to such holder at the address of such holder as shown on the transfer books of the Rights Agent or the Company or the transfer agent for the Common Shares. Any notice that is sent or mailed in the manner herein provided will be deemed given whether or not the holder receives the notice. Notwithstanding anything to the contrary in this Plan, prior to the Distribution Date, the issuance of a press release or the making of a publicly-available filing by the Company with the Securities and Exchange Commission will constitute sufficient notice by the Rights Agent or the Company to the holders of securities of the Company, including the Rights, for all purposes of this Plan and no other notice need be given.
Section 28.Supplements and Amendments. Prior to the occurrence of a Distribution Date, the Company may in its sole discretion supplement or amend this Plan in any respect without the approval of any holders of Rights Certificates, Preferred Shares or Common Shares, and the Rights Agent must, if the Company so directs, execute such supplement or amendment. From and after the occurrence of a Distribution Date, the Company and the Rights Agent may from time to time supplement or amend this Plan without the approval of any holders of Rights Certificates in order to (i) cure any ambiguity; (ii) correct or supplement any provision contained herein that may be defective or inconsistent with any other provisions herein or otherwise defective, including any change in order to satisfy any applicable law, rule or regulation; (iii) shorten or lengthen any time period hereunder; or (iv) change or supplement the provisions hereunder in any manner that the Company may deem necessary or desirable and that does not adversely affect the interests of the Rights Agent or the holders of Rights (other than an Acquiring Person, an Affiliate or Associate of an Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, a Subsequent Transferee or any nominee of any of the foregoing), including extending the Final Expiration Date;provided,however, that this Plan may not be supplemented or amended to lengthen, pursuant to clause (iii) of this sentence, a time period relating to when the Rights may be redeemed at a time when the Rights are not then redeemable;provided further,however, that the right of the Board to extend the Distribution Date does not require any amendment or supplement hereunder. Upon the delivery of a certificate from the Chairman of the Board, Chief Executive Officer, President, Chief Financial Officer, Secretary, Assistant Secretary or any Senior Vice President of the Company that states that the proposed supplement or amendment is in compliance with the terms of this Section 28. Notwithstanding anything to the contrary in this Plan, the Rights Agent may, but will not be required to, execute any such supplement or amendment that it has determined would adversely affects its rights, duties, obligations or immunities under this Plan. No supplement or amendment to this Plan shall be effective unless duly executed by the Rights Agent. Prior to the Distribution Date, the interests of the holders of Rights and Rights Certificates will be deemed to be coincident with the interests of the holders of Common Shares.
Section 29.Successors. All the covenants and provisions of this Plan by or for the benefit of the Company or the Rights Agent will bind and inure to the benefit of their respective successors and assigns hereunder.
Section 30.Determinations and Actions by the Board. Without limiting any of the rights and immunities of the Rights Agent, the Board (or an authorized committee thereof) has the exclusive power and authority to administer this Plan and to exercise all rights and powers specifically granted to the Board or the Company pursuant hereto, or as may be necessary or advisable in the administration of this Plan, including the right and power to (a) interpret the provisions of this Plan and (b) make all determinations deemed necessary or advisable for the administration of this Plan (including a determination as to whether to redeem the Rights or to amend this Plan). All such actions, calculations, interpretations and determinations (including, for purposes of clause (ii) below, all omissions with respect to the foregoing) that are done or made by the Board (or an authorized committee thereof) in good faith will (i) be final, conclusive and binding on the Company, the Rights Agent (except with respect to the rights, obligations, duties and immunities of the Rights Agent under this Plan), the holders of Rights Certificates and all other Persons; and (ii) not subject the Board (or an authorized committee thereof) or any of the directors serving on the Board to any liability to any Person, including the Rights Agent and the holders of Rights Certificates. In administering this Plan and exercising the rights and powers specifically granted to the Board and to the Company hereunder, and in interpreting this Plan and making any determination hereunder, the Board (or an authorized committee thereof) may consider any and all facts, circumstances or information that it deems to be necessary, useful or appropriate. The Rights Agent is always entitled to assume that the Board acted in good faith and will be fully protected and incur no liability in reliance thereon.
Section 31.Benefits of this Plan. Nothing in this Plan may be construed to give to any Person other than the Company, the Rights Agent and the registered holders of Rights Certificates (and, prior to the Distribution Date, the registered holders of Common Shares) any legal or equitable right, remedy or claim pursuant to this Plan. This Plan is for the sole and exclusive benefit of the Company, the Rights Agent and the registered holders of Rights Certificates (and, prior to the Distribution Date, the registered holders of Common Shares).
Section 32.Severability. If any term, provision, covenant or restriction of this Plan 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 Plan will remain in full force and effect and will in no way be affected, impaired or invalidated;provided,however, that notwithstanding anything to the contrary in this Plan, if any such term, provision, covenant or restriction is held by such court or authority to be invalid, void or unenforceable and the Board determines in its good faith judgment that severing the invalid language from this Plan would adversely affect the purpose or effect of this Plan, then the right of redemption set forth in Section 23 will be reinstated and will not expire until the Close of Business on the 10th Business Day following the date of such determination by the Board;provided,further, that if such excluded provision shall affect the rights, immunities, liabilities, duties or obligations of the Rights Agent, then the Rights Agent shall be entitled to resign immediately upon written notice to the Company.
Section 33.Governing Law; Exclusive Jurisdiction.
(a) GoverningLaw.This Planand eachRightandRightsCertificate issuedhereunder willbe deemed tobe acontract madepursuanttothe lawsof the StateofDelawareand forall purposes willbegovernedbyand construed inaccordance withthe lawsof the StateofDelawareapplicable tocontractsmadeandtobeperformedentirely withintheStateof Delaware.
(b) ExclusiveJurisdiction.
(i) TheCompanyandtheregisteredholdersofRightsCertificates (and,prior totheDistribution Date,the registeredholdersofCommonShares) each hereby irrevocablysubmits tothe exclusivejurisdictionof theCourtofChanceryof the StateofDelaware, or, if such courtlacks subject matterjurisdiction, the United States DistrictCourt fortheDistrictof Delaware,overany suit,action orproceeding arisingoutof orrelatingtoorconcerningthisPlan. TheCompanyandtheregisteredholdersofRightsCertificates (and,priortotheDistributionDate,theregisteredholdersofCommonShares) eachacknowledge that theforumdesignated by thisSection 33(b)(i)has areasonable relation tothisPlanand to such Persons’relationshipwithoneanother.
(ii) TheCompanyandthe registeredholdersofRights Certificates (and,prior totheDistribution Date,the registeredholdersofCommonShares) each hereby waive, tothefullestextentpermittedby applicablelaw,anyobjection that theynoworhereafterhaveto personaljurisdictionortothe laying ofvenueofany suchsuit,action orproceedingbrought inany court referred to inSection 33(b)(i) (orthe appellatecourts thereof). TheCompanyandtheregisteredholdersofRightsCertificates (and,priortotheDistributionDate,theregisteredholdersofCommonShares) eachundertakenotto commenceanyactionsubject tothis Plan inany forumother than the forum described inSection 33(b)(i). TheCompanyandthe registeredholdersofRights Certificates (and,prior totheDistribution Date,the registeredholdersofCommon Shares) each hereby agreethat, tothe fullestextent permittedby applicable law, a finalandnon-appealable judgment inany suchsuit,action orproceedingbrought inany such court willbe conclusiveandbinding upon such Persons.
Section 34.Counterparts. This Plan and any supplements or amendments hereto may be executed in any number of counterparts and each of such counterparts will for all purposes be deemed to be an original, and all such counterparts will together constitute one and the same instrument, it being understood that all parties need not sign the same counterpart. A signature to this Plan transmitted electronically (including by fax and .pdf) will have the same authority, effect and enforceability as an original signature. No party hereto may raise the use of such electronic transmission to deliver a signature, or the fact that any signature or agreement or instrument was transmitted or communicated through such electronic transmission, as a defense to the formation of a contract, and each party forever waives any such defense, except to the extent such defense relates to lack of authenticity.
Section 35.Descriptive Headings; Interpretation.
(a) DescriptiveHeadings. Thetable of contentsand descriptiveheadingsof the severalSectionsof this Plan are inserted forconvenienceonlyand willnotcontrolor affectthemeaningorconstructionofanyof the provisions hereof.
(b) Interpretation.
(i) Unless otherwiseindicated,allreferences herein toSectionsor Exhibitswillbedeemed to refer toSectionsor Exhibits of ortothisPlan, asapplicable. Anycapitalized terms used inanyExhibitbut not otherwisedefined thereinhave themeaning set forth inthis Plan. AllExhibitsattachedheretoor referred to herein are herebyincorporated inand made a partof this Plan as if fully set forthherein.
(ii) Unless otherwiseindicated, the words“include,”“includes”and“including,” when usedherein, are deemed in each case tobefollowedby thewords“without limitation.”
(iii) The words “hereof,” “herein,” “herewith”and wordsof similar import will,unless otherwisestated,beconstructed to refer tothis Plan aswhole andnot toany particular provisionof this Plan.
(iv) The word “or” is used inthe inclusive senseof “and/or.” Unlessthe context requires otherwise,the terms “or,”“any”and “either” are not exclusive.
(v) Wheneverthe context may require,anypronounsused inthis Planincludethecorresponding masculine, feminineor neuterforms, and the singular form of nouns and pronouns includes the plural and vice versa.
(vi) Where a wordor phrase isdefined, eachofitsother grammatical formshas acorrespondingmeaning.
(vii) References to“$” are tothe lawful currencyof the United Statesof America.
(viii) References toany statutewillbedeemed to refer to suchstatuteasamendedfrom time to timeand anyrulesor regulationspromulgated thereunder. References toany agreementorcontract willbe tothat agreementorcontract asamended, modifiedorsupplemented from time to time.
Section 36.Costs of Enforcement. The Company agrees with each registered holder of Rights Certificates (and, prior to the Distribution Date, the registered holders of Common Shares) that if the Company or any other Person the securities of which are purchasable upon exercise of the Rights fails to fulfill any of its obligations pursuant to this Plan, then the Company or such other Person must reimburse any registered holder of Rights Certificates for the costs and expenses (including legal fees) incurred by such holder in any action to enforce such holder’s rights pursuant to any Right or this Plan.
Section 37.Force Majeure. Notwithstanding anything to the contrary in this Plan, the Rights Agent will not be liable for any delays or failures in performance resulting from acts beyond its reasonable control, including fires, floods, natural disasters, acts of God, terrorist acts, shortage of supply, legal restrictions, breakdowns or malfunctions, interruptions or malfunction of computer facilities, or loss of data due to power failures or mechanical difficulties with information storage or retrieval systems, labor difficulties, war or civil unrest.
Section 38.USA PATRIOT Act. The Company acknowledges that the Rights Agent is subject to the customer identification program requirements pursuant to the USA PATRIOT Act and its implementing regulations, and that the Rights Agent must obtain, verify and record information that allows the Rights Agent to identify the Company. Accordingly, prior to accepting an appointment hereunder, the Rights Agent has received information from the Company that will help the Rights Agent to identify the Company, including the Company’s physical address, tax identification number, organizational documents, certificate of good standing, license to do business or such other information that the Rights Agent deems necessary and, pending verification of such received information, the Rights Agent may request additional such information. The Company agrees to provide all reasonably requested information necessary for the Rights Agent to verify the Company’s identity in accordance with such customer identification program requirements.
[Signature page follows.]
IN WITNESS WHEREOF, the parties hereto have caused this Plan to be duly executed as of the day and year first above written.
| | AVIAT NETWORKS, INC. |
| | |
| | By: | /s/ Walter Stanley Gallagher, Jr. |
| | | Name: | Walter Stanley Gallagher, Jr. |
| | | Title: | Chief Operating Officer and Principal Financial Officer |
| | COMPUTERSHARE, INC. |
| | |
| | By: | /s/ Patrick Hayes |
| | | Name: | Patrick Hayes |
| | | Title: | Manager, Contract Administration |
[Signature Page to Tax Benefit Preservation Plan]
EXHIBIT A
FORM OF
CERTIFICATE OF DESIGNATION OF RIGHTS, PREFERENCESAND PRIVILEGES OF SERIES A PARTICIPATING PREFERRED STOCK OF
AVIAT NETWORKS, INC.
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
Aviat Networks, Inc., a corporation organized and existing under the General Corporation Law of the State of Delaware (the “Corporation”), in accordance with the provisions of Section 103 thereof, does hereby certify:
That pursuant to the authority conferred upon the Board of Directors of the Corporation (the “Board”) by the Amended and Restated Certificate of Incorporation of the Corporation, as amended, on September 6, 2016, the Board adopted the following resolutions creating a series of preferred stock, par value $0.01 per share (“Preferred Stock”), of the Corporation designated as Series A Participating Preferred Stock:
RESOLVED: That pursuant to the authority vested in the Board by the Amended and Restated Certificate of Incorporation of the Corporation, as amended (the “Charter”), the Board does hereby provide for the issuance of a series of Preferred Stock of the Corporation and does hereby fix and herein state and express the designations, powers, preferences and relative and other special rights, and the qualifications, limitations and restrictions, of such series of Preferred Stock as follows:
Section 1.Designation and Amount. The shares of such series shall be designated as “Series A Participating Preferred Stock.” The Series A Participating Preferred Stock shall have a par value of $0.01 per share, and the number of shares constituting such series shall be 100,000. Such number of shares may be increased or decreased by resolution of the Board;provided,however, that no decrease shall reduce the number of shares of Series A Participating Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the exercise of any options, rights or warrants issuable upon conversion of any outstanding securities issued by the Corporation convertible into Series A Participating Preferred Stock.
Section 2.Proportional Adjustment. In the event that the Corporation shall at any time after the issuance of any share or shares of Series A Participating Preferred Stock (the “Rights Declaration Date”) (a) declare any dividend on the common stock of the Corporation, par value $0.01 per share (the “Common Stock”), payable in shares of Common Stock, (b) subdivide the outstanding Common Stock or (c) combine the outstanding Common Stock into a smaller number of shares, then in each such case the Corporation shall simultaneously effect a proportional adjustment to the number of outstanding shares of Series A Participating Preferred Stock by an amount the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
Section 3.Dividends and Distributions.
(a) Subject toSection 2and totheprior and superior rightsof theholdersofany sharesofany seriesof Preferred Stockranking prior and superiortothe sharesof Series AParticipating Preferred Stock with respect todividends, theholdersof sharesof Series AParticipating Preferred Stockshallbe entitledto receive, when, asandif declaredby theBoardoutoffundslegally availableforthepurpose,quarterlydividendspayablein cashon thelastdayofOctober, January, Apriland Julyin eachyear(each suchdate beingreferred to herein as a “Quarterly Dividend Payment Date”),commencingon thefirst QuarterlyDividendPayment Date afterthefirstissuanceofa shareorfractionofa shareofSeries AParticipatingPreferredStock,in anamountpershare (rounded tothenearestcent)equaltothegreaterof(i)$1.00 and(ii)subjecttoSection2,1,000timestheaggregate pershareamount ofallcashdividends,and 1,000 timestheaggregate per shareamount(payable inkind)ofall non-cashdividendsor other distributions other than adividendpayable in sharesofCommonStockorasubdivision of the outstandingsharesofCommonStock (by reclassificationorotherwise), declaredon theCommonStocksincetheimmediately precedingQuarterlyDividendPayment Date, or, with respect tothefirst QuarterlyDividendPayment Date,sincethefirstissuanceofanyshareor fractionof a shareof Series AParticipatingPreferredStock.
(b) TheCorporation shall declare adividendor distribution on the Series AParticipating Preferred Stock asprovided in paragraph (a)aboveimmediatelyafter it declares adividendor distribution on theCommonStock(otherthanadividendpayablein sharesofCommonStock);provided,however,that,inthe event that nodividendor distributionshallhavebeendeclaredon theCommonStockduringtheperiodbetweenanyQuarterlyDividend Payment Dateandthe next subsequent QuarterlyDividend Payment Date, adividendof$1.00 per shareon the Series AParticipating Preferred Stockshall neverthelessbe payable onsuchsubsequentQuarterlyDividendPayment Date.
(c) Dividendsshallbeginto accrueandbe cumulative on outstandingsharesofSeries AParticipatingPreferred Stock fromtheQuarterlyDividend Payment Datenextprecedingthe date of issueofsuch sharesof Series AParticipating PreferredStock, unlessthe date of issueof such shares ispriortotherecorddateforthefirst QuarterlyDividendPayment Date, in which casedividendsonsuch sharesshallbeginto accrue fromthe date ofissueofsuch shares,orunlessthe date of issue is a QuarterlyDividend Payment Dateoris adate afterthe recorddateforthedeterminationofholdersof sharesofSeries AParticipatingPreferred Stockentitledto receive a quarterlydividendandbefore such QuarterlyDividendPayment Date, ineither ofwhicheventssuchdividendsshallbeginto accrueandbe cumulativefrom such QuarterlyDividendPayment Date. Accruedbut unpaid dividendsshallnotbearinterest.Dividends paid on thesharesofSeries AParticipatingPreferred Stock in anamountlessthan the total amount ofsuchdividendsatthetime accruedandpayable on such sharesshallbeallocatedpro rataon a share-by-sharebasis among allsuch shares at the time outstanding. The Board may fix a record date for the determination of holders of shares of Series A Participating Preferred Stock entitled to receive payment of a dividend or distribution declared thereon, which record date shall be no more than 60 days prior to the date fixed for the payment thereof.
Section 4.Voting Rights. The holders of shares of Series A Participating Preferred Stock shall have the following voting rights:
(a) Subjecttotheprovisionforadjustmenthereinafter set forth, each shareofSeries AParticipatingPreferred Stockshallentitle theholderthereof to1,000votes onall matterssubmitted to avoteof the stockholders of theCorporation.Inthe event that theCorporation shall atany time aftertheRightsDeclaration Date (i) declareanydividendonCommon Stockpayablein sharesofCommon Stock, (ii)subdividethe outstandingCommon Stockor(iii)combine the outstandingCommonStock into a smaller number of shares, then in each such case the number of votespershare to whichholdersof shares of Series AParticipatingPreferred Stock were entitledimmediately priorto such eventshallbeadjustedby multiplying such number by a fraction thenumeratorof which is the number of shares ofCommonStock outstandingimmediatelyafter such eventandthe denominator of which is the number of shares ofCommonStock that were outstandingimmediately priorto such event.
(b) Exceptas otherwiseprovidedherein,inanyotherCertificateofDesignationcreating a seriesofPreferred Stockoranysimilarstock,theCharteror the Amendedand Restated Bylawsof theCorporation (the “Bylaws”),or by law,theholdersof sharesof Series AParticipating Preferred Stockandtheholdersof sharesofCommon Stockshallvotetogether asone classonall matterssubmitted to avoteof stockholders of theCorporation.
(c) Except as set forth hereinor as requiredby law,theholdersof Series AParticipating Preferred Stockshallhave nospecialvotingrights andtheir consentshallnotberequired (except tothe extent that theyareentitledtovotewithholdersofCommonStock as set forthherein)fortakinganycorporateaction.
(d) (i)IfatanytimedividendsonanySeries AParticipatingPreferred Stockshallbein arrears in anamount equalto six quarterlydividendsthereon,then the occurrenceof suchcontingencyshall markthebeginningof aperiod (hereincalled a “default period”)thatshallextenduntil such time asallaccruedandunpaid dividendsforallpreviousquarterlydividendperiods andforthecurrent quarterlydividendperiodonallsharesofSeries AParticipating Preferred Stockthen outstandingshallhavebeen declaredandpaid or set apart forpayment. During eachdefault period, all holdersof Preferred Stock(includingholdersof Series AParticipating PreferredStock) withdividends in arrears in anamount equal to six quarterlydividendsthereon,voting as a class, irrespectiveof series,shallhave theright to elect two directors.
(ii) Duringany default period, suchvotingrightof theholdersof Series AParticipating Preferred Stock maybe exercisedinitially at aspecial meeting called pursuanttosubparagraph(iii)ofthisSection4(d)oratanyannualmeetingofstockholders, andthereafter atannualmeetingsofstockholders;provided,however,that suchvotingright shallnotbe exercisedunless the holders of at least one-third in number of shares of Preferred Stock outstanding shall be present in person or by proxy. The absence of a quorum of the holders of Common Stock shall not affect the exercise by the holders of Preferred Stock of such voting right. At any meeting at which the holders of Preferred Stock shall exercise such voting right initially during an existing default period, they shall have the right, voting as a class, to elect directors to fill such vacancies, if any, in the Board as may then exist up to two directors or, if such right is exercised at an annual meeting of stockholders, to elect two directors. If the number that may be so elected at any special meeting does not amount to the required number, the holders of Preferred Stock shall have the right to make such increase in the number of directors as shall be necessary to permit the election by them of the required number. After the holders of Preferred Stock shall have exercised their right to elect directors in any default period and during the continuance of such period, the number of directors shall not be increased or decreased except by vote of the holders of Preferred Stock as herein provided or pursuant to the rights of any equity securities ranking senior to or pari passu with the Series A Participating Preferred Stock.
(iii) Unlesstheholdersof Preferred Stockshall, during anexistingdefault period,havepreviously exercisedtheirright to elect directors,theBoard may order,oranystockholder or stockholdersowningintheaggregatenotlessthan10%of the total number ofsharesofPreferred Stockoutstanding, irrespectiveof series, may request,the calling of aspecial meetingof theholdersof PreferredStock, whichmeeting shallthereupon becalledby theChairmanof theBoard,Chief ExecutiveOfficer, President,ChiefFinancialOfficer, Secretary, Assistant Secretaryorany SeniorVice Presidentof theCorporation.Noticeofsuchmeeting andofanyannualmeetingat whichholdersofPreferred Stock areentitledtovotepursuanttothisparagraph (d)(iii)shallbe given to eachholderof recordof Preferred Stockbymailing acopy of suchnotice to suchholder at such holder’s last address asthe same appearson thebooksof theCorporation.Suchmeeting shallbecalledfor a timenotearlierthan 20 daysandnotlaterthan 60 daysafter such orderorrequest,orindefaultof the calling ofsuchmeeting within60 daysafter such orderorrequest, suchmeetingmaybecalledonsimilarnotice byanystockholder or stockholdersowning intheaggregatenot lessthan10%of the total number of sharesof Preferred Stockoutstanding.Notwithstandingthe provisions of thisparagraph (d)(iii),no suchspecial meeting shallbecalled duringtheperiod within60 daysimmediately precedingthe date fixed forthe next annualmeetingof thestockholders.
(iv) Inany default period,theholdersofCommon Stockandother classesofstockof theCorporation, ifapplicable,shallcontinue tobe entitled to electthewholenumber of directorsuntiltheholdersof Preferred Stockshallhave exercisedtheirright to elect two directorsvoting as a class, afterthe exerciseof whichright(A)the directors soelectedby theholdersof Preferred Stockshallcontinue in officeuntiltheir successorsshallhavebeen electedby suchholdersoruntiltheexpirationof thedefault period, and (B)any vacancy inthe Board may (except asprovided insubparagraph (ii)of this
Section 4(d)) be filled by vote of a majority of the remaining directors theretofore elected by the holders of the class of stock that elected the director whose office shall have become vacant. References in this Section 4(d) to directors elected by the holders of a particular class of stock shall include directors elected by such directors to fill vacancies as provided in clause (B) of the foregoing sentence.
(v) Immediatelyupontheexpirationofadefault period,(A)therightof theholdersofPreferred Stock as a class to elect directorsshallcease, (B)the termofany directorselectedby theholdersof Preferred Stock as a classshall terminateand (C)the number of directorsshallbe suchnumber as maybe provided for inthe Charteror the Bylaws irrespectiveofany increase madepursuant tothe provisions ofsubparagraph (ii)of thisSection 4(d) (suchnumber beingsubject, however, tochange thereafter inany mannerprovided bylawor inthe Charteror Bylaws). Anyvacancies inthe Board effectedby the provisions ofclauses (B)and (C) inthepreceding sentence maybe filledby a majorityof the remaining directors.
Section 5.Certain Restrictions.
(a) TheCorporation shallnot declareanydividend on, makeanydistributionon,or redeemor purchaseor otherwiseacquire forconsideration any sharesofCommon Stock afterthe firstissuanceof a shareor fractionof a shareof Series AParticipating Preferred Stockunless concurrently therewith itshall declare adividendon the Series AParticipating Preferred Stock as requiredbySection 3 hereof.
(b) Whenever quarterlydividendsor otherdividendsor distributions payable on the Series AParticipating Preferred Stock asprovided inSection 3 hereof are in arrears, thereafteranduntilall accruedandunpaid dividendsanddistributions,whetherornotdeclared,on sharesof Series AParticipatingPreferred Stockoutstandingshallhavebeenpaidin full,theCorporation shallnot:
(i) declareorpaydividends on, makeanyother distributionson,or redeemor purchaseor otherwiseacquire forconsideration any sharesofstock rankingjunior (either as todividendsorupon liquidation,dissolution or windingup) tothe Series AParticipating PreferredStock;
(ii) declareorpaydividends, ormakeanyother distributions, onanysharesofstock rankingona parity (either as todividendsorupon liquidation,dissolution or windingup) withthe Series AParticipating PreferredStock,exceptdividendspaid ratablyon the Series AParticipating Preferred Stockand all such paritystockon whichdividends arepayable or in arrears inproportion tothe total amounts to whichtheholdersofall such shares arethen entitled;
(iii) redeemorpurchaseorotherwiseacquireforconsiderationsharesofany stock rankingona parity (either as todividendsorupon liquidation,dissolution or windingup)withtheSeries AParticipatingPreferredStock;provided,however,that theCorporationmay atanytime redeem, purchaseor otherwiseacquire sharesofany such paritystock inexchange for sharesofany stockof theCorporation rankingjunior (either as todividendsorupondissolution,liquidationor windingup) tothe Series AParticipating PreferredStock;or
(iv) redeemor purchaseor otherwiseacquire forconsideration any sharesof Series AParticipating PreferredStock,orany sharesofstock rankingona parity withtheSeries AParticipatingPreferredStock,exceptinaccordancewith a purchase offer made in writingor bypublication(as determinedby theBoard)toall holdersofsuch sharesuponsuch terms astheBoard,afterconsiderationof therespectiveannualdividendratesandotherrelative rights andpreferencesof therespective seriesandclasses,shalldetermine ingoodfaith will result in fairandequitabletreatmentamongtherespective seriesor classes.
(c) TheCorporation shallnot permitany subsidiaryof theCorporation to purchaseor otherwiseacquire forconsideration any sharesofstockof theCorporation unlesstheCorporationcould,pursuant to paragraph (a)of thisSection5, purchaseor otherwiseacquire such shares at such timeand in such manner.
Section 6.Reacquired Shares. Any shares of Series A Participating Preferred Stock purchased or otherwise acquired by the Corporation in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. All such shares shall upon their cancellation become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock to be created by resolution or resolutions of the Board, subject to the conditions and restrictions on issuance set forth herein, in the Charter or in any other Certificate of Designation creating a series of Preferred Stock or any similar stock or as otherwise required by law.
Section 7.Liquidation, Dissolution or Winding Up.
(a) Uponanyliquidation(voluntaryorotherwise),dissolution or winding up of theCorporation,no distributionshallbemade totheholdersofsharesofstock rankingjunior (either as todividendsorupon liquidation,dissolution or windingup) tothe Series AParticipating Preferred Stockunless, prior thereto,theholdersofsharesofSeries AParticipatingPreferred Stockshallhavereceived anamount equalto$1,000pershareofSeries AParticipatingPreferredStock,plusanamount equalto accruedandunpaid dividendsanddistributionsthereon, whetherornotdeclared,tothe date ofsuchpayment(the “Series A Liquidation Preference”).Followingthepaymentof thefullamount of theSeries ALiquidationPreference,noadditionaldistributionsshallbemade totheholdersofsharesofSeries AParticipatingPreferred Stockunless, prior thereto,theholdersofsharesofCommonStockshallhavereceived anamountpershare (the “Common Adjustment”)equaltothequotientobtained bydividing(i)theSeries ALiquidationPreferenceby(ii)1,000(asappropriately adjustedto reflecteventsasstock splits, stockdividendsand recapitalizationswith respect totheCommon Stock)(suchnumberinclause(ii),the “Adjustment Number”).Followingthepaymentof the fullamount of the Series ALiquidation PreferenceandtheCommon Adjustment in respectofalloutstanding sharesof Series AParticipating Preferred Stockand Common Stock, respectively, holdersof Series AParticipating Preferred Stockand holdersofsharesofCommonStockshallreceivetheirratableandproportionateshareof theremaining assets tobedistributedintheratioof theAdjustment Number toone with respect to such Preferred Stockand Common Stock,on aper share basis,respectively.
(b) Inthe event,however,thatthere arenotsufficient assetsavailableto permitpaymentin fullof theSeries ALiquidationPreferenceandtheliquidation preferencesofallother seriesof PreferredStock, ifany, that rankon a parity withthe Series AParticipating PreferredStock,then such remaining assetsshallbedistributedratably totheholdersofsuch parity shares inproportiontotheirrespectiveliquidationpreferences.Inthe event,however,thatthere arenotsufficient assetsavailableto permitpaymentin fullof theCommon Adjustment,thensuch remaining assetsshallbedistributedratably totheholdersofCommon Stock.
(c) Inthe event that theCorporation shall atany time aftertheRights Declaration Date (i) declareanydividendon theCommon Stockpayable in sharesofCommon Stock, (ii)subdividethe outstandingCommon Stockor (iii)combine the outstandingCommon Stockinto a smallernumber of shares,thenin each such casetheCorporation shall simultaneouslyeffect aproportionaladjustmenttotheAdjustment Number in effectimmediately priorto suchevent byanamount thenumeratorofwhich isthe number ofsharesofCommonStockoutstandingimmediatelyafter sucheventandthe denominator ofwhich isthe number of sharesofCommonStockthat wereoutstandingimmediately prior to suchevent.
Section 8.Consolidation, Merger, etc. In the event that the Corporation shall enter into any consolidation, merger, combination, conversion, share exchange or other transaction in which the shares of Common Stock are exchanged for or changed into other stock, securities, cash and/or any other property (payable in kind), then in any such case the shares of Series A Participating Preferred Stock shall at the same time be similarly exchanged or changed in an amount per share (subject to Section 2) equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is changed or exchanged.
Section 9.No Redemption. The shares of Series A Participating Preferred Stock shall not be redeemable.
Section 10.Ranking. The Series A Participating Preferred Stock shall rank junior to all other series of the Preferred Stock as to the payment of dividends and the distribution of assets, unless the terms of any such series shall provide otherwise.
Section 11.Amendment. At any time when any shares of Series A Participating Preferred Stock are outstanding, neither the Charter nor this Certificate of Designation shall be amended in any manner that would materially alter or change the powers, preferences or special rights of the Series A Participating Preferred Stock so as to affect them adversely without the affirmative vote of the holders of at least two-thirds of the outstanding shares of Series A Participating Preferred Stock, voting separately as a class.
Section 12.Fractional Shares. Series A Participating Preferred Stock may be issued in fractions of a share that shall entitle the holder, in proportion to such holder’s fractional shares, to exercise voting rights, receive dividends, participate in distributions and to have the benefit of all other rights of holders of Series A Participating Preferred Stock.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of the 7thday of September, 2016.
| | AVIAT NETWORKS, INC. |
| | |
| | By: | /s/ Ralph S. Marimon |
| | | Name: | Ralph S. Marimon |
| | | Title: | Senior Vice President and Chief Financial Officer |
EXHIBIT B
FORM OF
RIGHTS CERTIFICATE
Certificate No. R-[•] [•]Rights
NOTEXERCISABLE AFTER MARCH 3,2023,ORSUCH EARLIERDATE ASTHE RIGHTS ARE REDEEMED,EXCHANGED ORTERMINATED. THE RIGHTS ARE SUBJECT TO REDEMPTION,AT THEOPTION OF THE COMPANY(ASDEFINED BELOW),AT$0.01 PER RIGHT,ANDEXCHANGE, IN EACH CASEPURSUANT TO THE TERMS SET FORTHIN THE PLAN(ASDEFINED BELOW).UNDER CERTAIN CIRCUMSTANCES, RIGHTS BENEFICIALLYOWNED BYAN ACQUIRING PERSONOR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRINGPERSON(AS SUCH TERMS AREDEFINED IN THEPLAN)AND ANYSUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOMENULLAND VOID.[THE RIGHTS REPRESENTED BYTHIS RIGHTS CERTIFICATE AREOR WERE BENEFICIALLYOWNED BY A PERSONWHO WAS ORBECAMEAN ACQUIRINGPERSONOR AN AFFILIATE OR ASSOCIATE OF AN ACQUIRINGPERSON. ACCORDINGLY,THISRIGHTS CERTIFICATEANDTHE RIGHTS REPRESENTED HEREBY MAY BECOMENULLAND VOIDINTHE CIRCUMSTANCES SPECIFIEDINSECTION 7(e)OFTHEPLAN.]1
RIGHTS CERTIFICATE
AVIAT NETWORKS,INC.
This certifiesthat,orregistered assigns, istheregistered ownerof the number ofRightsset forthabove,eachofwhichentitles theowner thereof,subjecttotheterms,provisionsandconditionsof theTax Benefit Preservation Plan,datedasof MARCH 3,2020(the “Plan”), between Aviat Networks, Inc., a Delawarecorporation (the “Company”),and Computershare Inc., a Delawarecorporation(the “Rights Agent,” which termshallincludeanysuccessorRights Agentpursuanttothe Plan), to purchase fromthe Companyatany time aftertheDistributionDate (as such term isdefined inthe Plan)and prior totheExpirationDate (as such term isdefined inthe Plan) atthe officeof theRightsAgentdesignated for suchpurpose,or atthe officeofits successor asRightsAgent,oneone-thousandth ofa fullypaidand nonassessableshareofSeries AParticipatingPreferredStock, parvalue$0.01 pershare (the “Preferred Shares”),of the Company, at an exercise priceof $35.00peroneone-thousandth of a Preferred Share (the“Exercise Price”),uponpresentation and surrenderof thisRightsCertificate withthe FormofElection to Purchaseand related Certificatedulyexecuted. Thenumber ofRightsevidenced by thisRightsCertificate (andthe number ofoneone-thousandths of a Preferred Sharethat maybe purchased upon exercise hereof) set forth above, and the Exercise Price per share set forth above, are the number and Exercise Price as of MARCH 3, 2020, based on the Preferred Shares as constituted at such date. As provided in the Plan, the Exercise Price and the number and kind of Preferred Shares or other securities that may be purchased upon the exercise of the Rights evidenced by this Rights Certificate are subject to modification and adjustment upon the occurrence of certain events. The Company reserves the right to require prior to the occurrence of a Triggering Event (as such term is defined in the Plan) that a number of Rights be exercised so that only whole Preferred Shares will be issued. Capitalized terms used in this Rights Certificate without definition shall have the meanings ascribed to them in the Plan.
1 Theportion of the legend inbrackets is tobe insertedonly ifapplicableand will replacethepreceding sentence.
Upon the occurrence of a Section 11(a)(ii) Event, if the Rights evidenced by this Rights Certificate are beneficially owned by an Acquiring Person, an Affiliate or Associate of an Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, a Subsequent Transferee or any nominee of any of the foregoing, such Rights shall become null and void and no holder hereof shall have any right with respect to such Rights from and after the occurrence of such Section 11(a)(ii) Event.
This Rights Certificate is subject to all of the terms, provisions and conditions of the Plan, which terms, provisions and conditions are hereby incorporated herein by reference and made a part hereof and to which Plan reference is hereby made for a full description of the rights, limitations of rights, obligations, duties and immunities hereunder of the Rights Agent, the Company and the holders of the Rights Certificates, which limitations of rights include the temporary suspension of the exercisability of such Rights under the specific circumstances set forth in the Plan. Copies of the Plan are on file at the principal executive offices of the Company and the above-mentioned office of the Rights Agent and are available without cost upon written request.
Subject to the provisions of the Plan, the Rights evidenced by this Rights Certificate may be redeemed by the Company, at its option, at a redemption price of $0.01 per Right at any time prior to the earlier of (i) the Distribution Date or (ii) the Close of Business on the Final Expiration Date. In addition, under certain circumstances after any Person becomes an Acquiring Person, the Rights may be exchanged, in whole or in part, for Common Shares, or cash other securities of the Company having essentially the same value or economic rights as such shares. Immediately upon the action of the Board authorizing any such exchange, and without any further action or any notice, the Rights (other than Rights that are not subject to such exchange) will terminate and the Rights will only enable holders to receive the Common Shares (or cash or other securities or assets of the Company) issuable upon such exchange.
This Rights Certificate, with or without other Rights Certificates, upon surrender at the office of the Rights Agent designated for such purpose, may be exchanged for another Rights Certificate or Rights Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like number of one one-thousandths of a Preferred Share as the Rights evidenced by the Rights Certificate or Rights Certificates surrendered shall have entitled such holder to purchase. If this Rights Certificate is exercised in part, then the holder will be entitled to receive upon surrender hereof another Rights Certificate or Rights Certificates for the number of whole Rights not exercised.
No fractions of Preferred Shares (other than fractions that are integral multiples of one one-thousandth of a Preferred Share, which may, at the election of the Company, be evidenced by depositary receipts) will be issued upon the exercise of any Right or Rights evidenced hereby. In lieu thereof, a cash payment will be made as provided in the Plan. The Company, at its election, may require that a number of Rights be exercised so that only whole Preferred Shares would be issued.
No holder of this Rights Certificate, as such, shall be entitled to vote or receive dividends or be deemed for any purpose the holder of the number of one one-thousandths of a Preferred Share or any other securities of the Company that may at any time be issuable on the exercise or exchange hereof, nor shall anything contained in herein or in the Plan 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 specifically provided in the Plan), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by this Rights Certificate shall have been exercised or exchange in accordance with the Plan.
This Rights Certificate shall not be valid or obligatory for any purpose until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company and its corporate seal.
| Dated as of , 20[•]. | | |
| | | |
| ATTEST: | | AVIAT NETWORKS, INC. |
| | | |
| By: | | | By: | |
| | Name: | | | | Name: | |
| | Title: | | | | Title: | |
| Countersigned: | | |
| | | |
COMPUTERSHARE, INC. as Rights Agent | | |
| | | |
| By: | | | | |
| | Name: | | | | | |
| | Title: | | | | | |
[Form of Reverse Side of Rights Certificate] FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires to transfer the Rights Certificate.)
| FOR VALUE RECEIVEDhereby sells,assigns andtransfersunto |
| |
| (Please print name and address of transferee) |
| |
| |
| thisRights Certificate,together withall right,titleand interesttherein, anddoes hereby irrevocablyconstituteandappointas attorney-in-fact to transferthewithinRights Certificateon thebooksof the Company, with full powerof substitution. |
| Dated: _______________. | |
| | |
| | |
| | Signature |
Signature Medallion Guaranteed:
Signatures must be guaranteed by an “Eligible Guarantor Institution” (with membership in an approved signature guarantee medallion program at a level acceptable to the Rights Agent) pursuant to Rule 17Ad-15 of the Securities Exchange Act of 1934, as amended. All guarantees must be by a financial institution (such as a bank or broker) that is a participant in the Securities Transfer Agents Medallion Program (STAMP), the NASDAQ Medallion Signature Program (MSP) or the Stock Exchanges Medallion Program (SEMP) and must not be dated. Guarantees by a notary public are not acceptable.
CERTIFICATE
that:
The undersigned hereby certifies, for the benefit of the Company and all holders of Rights and Common Shares, by checking the appropriate boxes
| (1) | theRight(s)evidenced by thisRights Certificate arenotBeneficiallyOwnedand |
being sold, assigned and transferred by or on behalf of a Person who is or was an Acquiring Person, an Affiliate or Associate of an Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, a Subsequent Transferee or any nominee of any of the foregoing; and
| (2) | afterdueinquiryand tothe bestknowledge of the undersigned, it |
acquire the Rights evidenced by this Rights Certificate from any Person who is, was or subsequently became an Acquiring Person, an Affiliate or Associate of an Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, a Subsequent Transferee or any nominee of any of the foregoing.
| Dated: _______________. | |
| | |
| | |
| | Signature |
Signature Medallion Guaranteed:
Signatures must be guaranteed by an “Eligible Guarantor Institution” (with membership in an approved signature guarantee medallion program at a level acceptable to the Rights Agent) pursuant to Rule 17Ad-15 of the Securities Exchange Act of 1934, as amended. All guarantees must be by a financial institution (such as a bank or broker) that is a participant in the Securities Transfer Agents Medallion Program (STAMP), the NASDAQ Medallion Signature Program (MSP) or the Stock Exchanges Medallion Program (SEMP) and must not be dated. Guarantees by a notary public are not acceptable.
[Form of Reverse Side of Rights Certificate – continued]
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise Rights represented by the Rights Certificate.)
To: Aviat Networks, Inc.
Theundersignedhereby irrevocablyelects to exercise Rightsrepresentedby thisRightsCertificate to purchasethe number ofoneone-thousandthsof a Preferred Share (or suchother securitiesof the Company or ofanyother Personthat maybeissuableuponthe exerciseof the Rights)issuableuponthe exerciseof suchRightsand requeststhat certificates for such sharesbe issued inthe nameofand deliveredto:
Please insert social security
or other identifying number
| |
| (Please print name and address) |
| |
| |
If such number of Rights shall not be all of the Rights evidenced by this Rights Certificate, a new Rights Certificate for the balance remaining of such Rights shall be registered in the name of and delivered to:
Please insert social security
or other identifying number
| |
| (Please print name and address) |
| |
| |
| Dated: _______________. | |
| | |
| | |
| | Signature |
Signature Medallion Guaranteed:
Signatures must be guaranteed by an “Eligible Guarantor Institution” (with membership in an approved signature guarantee medallion program at a level acceptable to the Rights Agent) pursuant to Rule 17Ad-15 of the Securities Exchange Act of 1934, as amended. All guarantees must be by a financial institution (such as a bank or broker) that is a participant in the Securities Transfer Agents Medallion Program (STAMP), the NASDAQ Medallion Signature Program (MSP) or the Stock Exchanges Medallion Program (SEMP) and must not be dated. Guarantees by a notary public are not acceptable.
CERTIFICATE
that:
The undersigned hereby certifies, for the benefit of the Company and all holders of Rights and Common Shares, by checking the appropriate boxes
| (1) | theRight(s)evidenced by thisRights Certificate arenotBeneficiallyOwnedand |
being sold, assigned and transferred by or on behalf of a Person who is or was an Acquiring Person, an Affiliate or Associate of an Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, a Subsequent Transferee or any nominee of any of the foregoing; and
| (2) | afterdueinquiryand tothe bestknowledge of the undersigned, it |
acquire the Rights evidenced by this Rights Certificate from any Person who is, was or subsequently became an Acquiring Person, an Affiliate or Associate of an Acquiring Person, a Post-Event Transferee, a Pre-Event Transferee, a Subsequent Transferee or any nominee of any of the foregoing.
| Dated: _______________. | |
| | |
| | |
| | Signature |
Signature Medallion Guaranteed:
Signatures must be guaranteed by an “Eligible Guarantor Institution” (with membership in an approved signature guarantee medallion program at a level acceptable to the Rights Agent) pursuant to Rule 17Ad-15 of the Securities Exchange Act of 1934, as amended. All guarantees must be by a financial institution (such as a bank or broker) that is a participant in the Securities Transfer Agents Medallion Program (STAMP), the NASDAQ Medallion Signature Program (MSP) or the Stock Exchanges Medallion Program (SEMP) and must not be dated. Guarantees by a notary public are not acceptable.
[Form of Reverse Side of Rights Certificate – continued]
NOTICE
The signature in the foregoing Forms of Assignment and Election to Purchase, as the case may be, must conform to the name as written upon the face of this Rights Certificate in every particular, without alteration or enlargement or any change whatsoever.
IN THE EVENT THAT THE CERTIFICATIONS SET FORTH IN THE FOREGOINGFORMSOFASSIGNMENTANDELECTION TOPURCHASE, ASTHECASEMAYBE,ARENOTCOMPLETED, THEN THECOMPANYANDTHE RIGHTS AGENT WILL DEEM THE BENEFICIAL OWNER OF THE RIGHTS EVIDENCED BY THIS RIGHT CERTIFICATE TO BEANACQUIRING PERSON,AN AFFILIATE ORASSOCIATE OFANACQUIRING PERSON, A POST-EVENT TRANSFEREE, A PRE-EVENT TRANSFEREE, A SUBSEQUENT TRANSFEREE ORANY NOMINEE OFANY OF THE FOREGOING,AS THECASEMAYBE,AND SUCHASSIGNMENT OR ELECTION TOPURCHASE WILLNOTBE HONOREDAND THE RIGHTS EVIDENCED BY THIS RIGHTS CERTIFICATE WILL BE DEEMED TO BE NULLANDVOID.
EXHIBIT C
FORM OF
SUMMARY OF RIGHTS
SUMMARY OF
TAX BENEFIT PRESERVATION PLAN
OF
AVIAT NETWORKS, INC.
On March 3, 2020, the Board of Directors (the “Board”) of Aviat Networks, Inc. (the “Company”) authorized and declared a dividend distribution of one right (a “Right”) for each outstanding share of common stock, par value $0.01 per share (the “Common Shares”), of the Company to stockholders of record as of the close of business on March 13, 2020 (the “Record Date”). Each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series A Participating Preferred Stock, par value $0.01 per share (the “Preferred Shares”), of the Company at an exercise price of $35.00 (the “Exercise Price”) per one one-thousandth of a Preferred Share, subject to adjustment. The complete terms of the Rights are set forth in a Tax Benefit Preservation Plan (the “Plan”), dated as of March 3, 2020, between the Company and Computershare Inc., as rights agent.
By adopting the Plan, the Board is seeking to protect the Company’s ability to use its net operating losses, any loss or deducting attributable to a “net unrealized built-in loss” and other tax attributes (collectively, “Tax Benefits”). The Company views its Tax Benefits as highly valuable assets of the Company that are likely to inure to the benefit of the Company and its stockholders. However, if the Company experiences an “ownership change,” as defined in Section 382 of the Internal Revenue Code (the “Code”), its ability to use the Tax Benefits could be substantially limited, and the timing of the usage of the Tax Benefits could be substantially delayed, which could significantly impair the value of the Tax Benefits. Generally, an “ownership change” occurs if the percentage of the Company’s stock owned by one or more “five percent stockholders” increases by more than 50 percentage points over the lowest percentage of stock owned by such stockholders at any time during the prior three-year period or, if sooner, since the last “ownership change” experienced by the Company. The Plan is intended to act as a deterrent to any person acquiring 4.9% or more of the outstanding Common Shares without the approval of the Board. This would protect the Tax Benefits because changes in ownership by a person owning less than 4.9% of the Common Shares are not included in the calculation of “ownership change” for purposes of Section 382 of the Code. The Board believes that it is in the best interest of the Company and its stockholders that the Company provide for the protection of the Tax Benefits by adopting the Plan.
For those interested in the specific terms of the Plan, the following is a summary description. Please note, however, that this description is only a summary and is not complete, and should be read together with the entire Plan, which will be filed by the Company with the Securities and Exchange Commission as an exhibit to a Registration Statement on Form 8-A and a Current Report on Form 8-K. A copy of the Plan is available free of charge from the Company.
Distribution and Transfer of Rights; Rights Certificates
The Board has declared a dividend of one Right for each outstanding Common Share. Prior to the Distribution Date referred to below:
| • | the Rights will be evidenced by and trade with the certificates for the Common Shares (or, with respect to any uncertificated Common Shares registered in book entry form, by notation in book entry), and no separate rights certificates will be distributed; |
| • | new Common Shares certificates issued after the Record Date will contain a legend incorporating the Plan by reference (for uncertificated Common Shares registered in book entry form, this legend will be contained in a notation in book entry); and |
| • | the surrender for transfer of any certificates for Common Shares (or the surrender for transfer of any uncertificated Common Shares registered in book entry form) will also constitute the transfer of the Rights associated with such Common Shares. |
Rights will accompany any new Common Shares that are issued after the Record Date.
Distribution Date
Subject to certain exceptions specified in the Plan, the Rights will separate from the Common Shares and become exercisable following (1) the 10th business day (or such later date as may be determined by the Board) after the public announcement that a person or group of affiliated or associated persons (an “Acquiring Person”) has acquired beneficial ownership of 4.9% or more of the Common Shares or (2) the 10th business day (or such later date as may be determined by the Board) after a person or group announces a tender or exchange offer that would result in ownership by a person or group of 4.9% or more of the Common Shares. For purposes of the Plan, beneficial ownership is defined to include the ownership of derivative securities.
Any person or group of affiliated or associated persons who beneficially owns 4.9% or more of the outstanding Common Shares as of the announcement of the Plan will not be an Acquiring Person, but only for so long as such person or group does not become the beneficial owner of any additional Common Shares.
The date on which the Rights separate from the Common Shares and become exercisable is referred to as the “Distribution Date.”
After the Distribution Date, the Company will mail Rights certificates to the Company’s stockholders as of the close of business on the Distribution Date and the Rights will become transferable apart from the Common Shares. Thereafter, such Rights certificates alone will represent the Rights.
Preferred Shares Purchasable Upon Exercise of Rights
After the Distribution Date, each Right will entitle the holder to purchase, for the Exercise Price, one one-thousandth of a Preferred Share having economic and other terms similar to that of one Common Share. This portion of a Preferred Share is intended to give the stockholder approximately the same dividend, voting and liquidation rights as would one Common Share, and should approximate the value of one Common Share.
More specifically, each one one-thousandth of a Preferred Share, if issued, will:
| • | entitle holders to quarterly dividend payments of $0.01 per share, or an amount equal to the dividend paid on one Common Share, whichever is greater; |
| • | entitle holders upon liquidation either to receive $1.00 per share or an amount equal to the payment made on one Common Share, whichever is greater; |
| • | have the same voting power as one Common Share; and |
| • | entitle holders to a per share payment equal to the payment made on one Common Share if the Common Shares are exchanged via merger, consolidation or a similar transaction. |
Flip-In Trigger
If an Acquiring Person obtains beneficial ownership of 4.9% or more of the Common Shares, except pursuant to an offer for all outstanding Common Shares that the independent members of the Board determine to be fair and not inadequate and to otherwise be in the best interests of the Company and its stockholders after receiving advice from one or more investment banking firms, then each Right will entitle the holder thereof to purchase, for the Exercise Price, a number of Common Shares (or, in certain circumstances, cash, property or other securities of the Company) having a then-current market value of twice the Exercise Price. However, the Rights are not exercisable following the occurrence of the foregoing event until such time as the Rights are no longer redeemable by the Company, as further described below.
Following the occurrence of an event set forth in preceding paragraph, all Rights that are or, under certain circumstances specified in the Plan, were beneficially owned by an Acquiring Person or certain of its transferees will be null and void.
Flip-Over Trigger
If, after an Acquiring Person obtains 4.9% or more of the Common Shares, (1) the Company merges into another entity, (2) an acquiring entity merges into the Company or (3) the Company sells or transfers more than 50% of its assets, cash flow or earning power, then each Right (except for Rights that have previously been voided as set forth above) will entitle the holder thereof to purchase, for the Exercise Price, a number of shares of common stock of the person engaging in the transaction having a then-current market value of twice the Exercise Price.
Redemption of the Rights
The Rights will be redeemable at the Company’s option for $0.01 per Right (payable in cash, Common Shares or other consideration deemed appropriate by the Board) at any time on or prior to the 10th business day (or such later date as may be determined by the Board) after the public announcement that an Acquiring Person has acquired beneficial ownership of 4.9% or more of the Common Shares. Immediately upon the action of the Board ordering redemption, the Rights will terminate and the only right of the holders of the Rights will be to receive the $0.01 redemption price. The redemption price will be adjusted if the Company undertakes a stock dividend or a stock split.
Exchange Provision
At any time after the date on which an Acquiring Person beneficially owns 4.9% or more of the Common Shares and prior to the acquisition by the Acquiring Person of 50% of the Common Shares, the Board may exchange the Rights (except for Rights that have previously been voided as set forth above), in whole or in part, for Common Shares at an exchange ratio of one Common Share per Right (subject to adjustment). In certain circumstances, the Company may elect to exchange the Rights for cash or other securities of the Company having a value approximately equal to one Common Share.
Expiration of the Rights
The Rights expire on the earliest of (1) 5:00 p.m., New York City time, on March 3, 2023 (unless such date is extended); (2) the redemption or exchange of the Rights as described above; (3) following (a) the first annual meeting of the stockholders of the Company after the adoption of the Plan if stockholders do not approve the Plan or (b) the first anniversary of the adoption of the Plan if the stockholders have not otherwise approved the Plan; (4) the repeal of Section 382 of the Code or any other change if the Board determines that the Plan is no longer necessary or desirable for the preservation of the Tax Benefits; (5) the time at which the Board determines that the Tax Benefits are fully utilized or no longer available pursuant to Section 382 of the Code or that an ownership change pursuant to Section 382 of the Code would not adversely impact in any material respect the time period in which the Company could use the Tax Benefits, or materially impair the amount of the Tax Benefits that could be used by the Company in any particular time period, for applicable tax purposes; or (6) a determination by the Board that the Plan is no longer in the best interests of the Company and its stockholders.
Amendment of Terms of the Plan and the Rights
The terms of the Rights and the Plan may be amended in any respect without the consent of the holders of the Rights on or prior to the Distribution Date. Thereafter, the terms of the Rights and the Plan may be amended without the consent of the holders of Rights in order to (1) cure any ambiguities, (2) shorten or lengthen any time period pursuant to the Plan or (3) make changes that do not adversely affect the interests of holders of the Rights.
Voting Rights; Other Stockholder Rights
The Rights will not have any voting rights. Until a Right is exercised, the holder thereof, as such, will have no separate rights as stockholder of the Company.
Anti-Dilution Provisions
The Board may adjust the Exercise Price, the number of Preferred Shares issuable and the number of outstanding Rights to prevent dilution that may occur from a stock dividend, a stock split or a reclassification of the Preferred Shares or Common Shares.
With certain exceptions, no adjustments to the Exercise Price will be made until the cumulative adjustments amount to at least 1% of the Exercise Price. No fractional Preferred Shares will be issued and, in lieu thereof, an adjustment in cash will be made based on the current market price of the Preferred Shares.
Taxes
The distribution of Rights should not be taxable for federal income tax purposes. However, following an event that renders the Rights exercisable or upon redemption of the Rights, stockholders may recognize taxable income.
