CONAGRA, INC.
and
CHASEMELLON SHAREHOLDER SERVICES, L.L.C., as Rights Agent
RIGHTS AGREEMENT
Dated as of July 12, 1996
TABLE OF CONTENTS
Page
Section 1.Certain Definitions. . . . . . . . . . . . . . . .1
Section 2.Appointment of Rights Agent. . . . . . . . . . . .5
Section 3.Issue of Right Certificates. . . . . . . . . . . .5
Section 4.Form of Right Certificates . . . . . . . . . . . .7
Section 5.Countersignature and Registration. . . . . . . . .7
Section 6.Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right
Certificates . . . . . . . . . . . . . . . . . . .8
Section 7.Exercise of Rights, Purchase Price; Expiration Date of Rights 9
Section 8.Cancellation and Destruction of Right Certificates10
Section 9.Availability of Shares of Preferred Stock. . . . 10
Section 10.Preferred Stock Record Date . . . . . . . . . . 11
Section 11.Adjustment of Purchase Price, Number of Shares and Number
of Rights. . . . . . . . . . . . . . . . . . . . 12
Section 12.Certificate of Adjusted Purchase Price or Number of Shares19
Section 13.Consolidation, Merger or Sale or Transfer of Assets or
Earnings Power . . . . . . . . . . . . . . . . . 20
Section 14.Fractional Rights and Fractional Shares . . . . 23
Section 15.Rights of Action. . . . . . . . . . . . . . . . 24
Section 16.Agreement of Right Holders. . . . . . . . . . . 24
Section 17.Right Certificate Holder Not Deemed a Stockholder25
Section 18.Concerning the Rights Agent . . . . . . . . . . 25
Section 19.Merger or Consolidation or Change of Name of Rights Agent26
Section 20.Duties of Rights Agent. . . . . . . . . . . . . 26
Section 21.Change of Rights Agent. . . . . . . . . . . . . 28
Section 22.Issuance of New Right Certificates. . . . . . . 29
Section 23.Redemption. . . . . . . . . . . . . . . . . . . 29
Section 24.Exchange. . . . . . . . . . . . . . . . . . . . 30
Section 25.Notice of Certain Events. . . . . . . . . . . . 31
Section 26.Notices . . . . . . . . . . . . . . . . . . . . 32
Section 27.Supplements and Amendments. . . . . . . . . . . 33
Section 28.Successors. . . . . . . . . . . . . . . . . . . 33
Section 29.Benefits of this Agreement. . . . . . . . . . . 33
Section 30.Determinations and Actions by the Board of Directors33
Section 31.Severability. . . . . . . . . . . . . . . . . . 34
Section 32.Governing Law . . . . . . . . . . . . . . . . . 34
Section 33.Counterparts. . . . . . . . . . . . . . . . . . 34
Section 34.Descriptive Headings. . . . . . . . . . . . . . 34
RIGHTS AGREEMENT
Rights Agreement, dated as of July 12, 1996 ("Agreement"), between
ConAgra, Inc., a Delaware corporation (the "Company"), and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent (the "Rights Agent").
The Board of Directors of the Company has authorized and declared
a dividend of one preferred share purchase right (a "Right") for each share
of Common Stock (as hereinafter defined) of the Company outstanding as of the
Close of Business (as defined below) on July 24, 1996 (the "Record Date"),
each Right representing the right to purchase one one-thousandth (subject to
adjustment) of a share of Preferred Stock (as hereinafter defined), upon the
terms and subject to the conditions herein set forth, and has further
authorized and directed the issuance of one Right (subject to adjustment as
provided herein) with respect to each share of Common Stock that shall become
outstanding between the Record Date and the earlier of the Distribution Date
and the Expiration Date (as such terms are hereinafter defined); provided,
however, that Rights may be issued with respect to shares of Common Stock that
shall become outstanding after the Distribution Date and prior to the
Expiration Date in accordance with Section 22.
Accordingly, in consideration of the premises and the mutual
agreements herein set forth, the parties hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement,
the following terms have the meaning indicated:
(a) "Acquiring Person" shall mean any Person (as such term is
hereinafter defined) who or which shall be the Beneficial Owner (as such term
is hereinafter defined) of 15% or more of the shares of Common Stock then
outstanding, but shall not include an Exempt Person (as such term is
hereinafter defined); provided, however, that (i) if the Board of Directors of
the Company determines in good faith that a Person who would otherwise be an
"Acquiring Person" became such inadvertently (including, without limitation,
because (A) such Person was unaware that it beneficially owned a percentage of
Common Stock that would otherwise cause such Person to be an "Acquiring
Person" or (B) such Person was aware of the extent of its Beneficial Ownership
of Common Stock but had no actual knowledge of the consequences of such
Beneficial Ownership under this Agreement) and without any intention of
changing or influencing control of the Company, and if such Person as promptly
as practicable divested or divests itself of Beneficial Ownership of a
sufficient number of shares of Common Stock so that such Person would no
longer be an "Acquiring Person," then such Person shall not be deemed to be or
to have become an "Acquiring Person" for any purposes of this Agreement; (ii)
if, as of the date hereof, any Person is the Beneficial Owner of 15% or more
but less than 20% of the shares of Common Stock outstanding, such Person shall
not be or become an "Acquiring Person" unless and until such time as such
Person shall become the Beneficial Owner of additional shares of Common Stock
(other than pursuant to a dividend or distribution paid or made by the Company
on the outstanding Common Stock in shares of Common Stock or pursuant to a
split or subdivision of the outstanding Common Stock), unless, upon becoming
the Beneficial Owner of such additional shares of Common Stock, such Person is
not then the Beneficial Owner of 15% or more of the shares of Common Stock
then outstanding; and (iii) no Person shall become an "Acquiring Person" as
the result of an acquisition of shares of Common Stock by the Company which,
by reducing the number of shares outstanding, increases the proportionate
number of shares of Common Stock beneficially owned by such Person to 15% or
more of the shares of Common Stock then outstanding, provided, however, that
if a Person shall become the Beneficial Owner of 15% or more of the shares of
Common Stock then outstanding by reason of such share acquisitions by the
Company and shall thereafter become the Beneficial Owner of any additional
shares of Common Stock (other than pursuant to a dividend or distribution paid
or made by the Company on the outstanding Common Stock in shares of Common
Stock or pursuant to a split or subdivision of the outstanding Common Stock),
then such Person shall be deemed to be an "Acquiring Person" unless upon
becoming the Beneficial Owner of such additional shares of Common Stock such
Person does not beneficially own 15% or more of the shares of Common Stock
then outstanding. For all purposes of this Agreement, any calculation of the
number of shares of Common Stock outstanding at any particular time, including
for purposes of determining the particular percentage of such outstanding
shares of Common Stock of which any Person is the Beneficial Owner, shall be
made in accordance with the last sentence of Rule 13d-3(d)(1)(i) of the
General Rules and Regulations under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), as in effect on the date hereof.
(b) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act, as in effect on the date hereof.
(c) A Person shall be deemed the "Beneficial Owner" of, shall be
deemed to have "Beneficial Ownership" of and shall be deemed to "beneficially
own" any securities:
(i) which such Person or any of such Person's Affiliates
or Associates is deemed to beneficially own, directly or indirectly, within
the meaning of Rule l3d-3 of the General Rules and Regulations under the
Exchange Act as in effect on the date hereof;
(ii) which such Person or any of such Person's Affiliates
or Associates has (A) the right to acquire (whether such right is exercisable
immediately or only after the passage of time) pursuant to any agreement,
arrangement or understanding (other than customary agreements with and between
underwriters and selling group members with respect to a bona fide public
offering of securities), or upon the exercise of conversion rights, exchange
rights, rights, warrants or options, or otherwise; provided, however, that a
Person shall not be deemed the Beneficial Owner of, or to beneficially own,
(x) securities 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, (y) securities which such
Person has a right to acquire upon the exercise of Rights at any time prior to
the time that any Person becomes an Acquiring Person or (z) securities
issuable upon the exercise of Rights from and after the time that any Person
becomes an Acquiring Person 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 hereof ("Original Rights") or pursuant
to Section 11(i) or Section 11(n) with respect to an adjustment to Original
Rights; or (B) the right to vote pursuant to any agreement, arrangement or
understanding; provided, however, that a Person shall not be deemed the
Beneficial Owner of, or to beneficially own, any security by reason of such
agreement, arrangement or understanding if the agreement, arrangement or
understanding to vote such security (1) 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 rules
and regulations promulgated under the Exchange Act and (2) is not also then
reportable on Schedule 13D under the Exchange Act (or any comparable or
successor report); or
(iii)which are beneficially owned, directly or indirectly,
by any other Person and with respect to which such Person or any of such
Person's Affiliates or Associates has any agreement, arrangement or
understanding (other than customary agreements with and between underwriters
and selling group members with respect to a bona fide public offering of
securities) for the purpose of acquiring, holding, voting (except to the
extent contemplated by the proviso to Section 1(c)(ii)(B)) or disposing of
such securities of the Company;
provided, however, that no Person who is an officer, director or employee of
an Exempt Person shall be deemed, solely by reason of such Person's status or
authority as such, to be the "Beneficial Owner" of, to have "Beneficial
Ownership" of or to "beneficially own" any securities that are "beneficially
owned" (as defined in this Section l(c)), including, without limitation, in a
fiduciary capacity, by an Exempt Person or by any other such officer, director
or employee of an Exempt Person.
(d) "Business Day" shall mean any day other than a Saturday, a
Sunday or a day on which banking institutions in the State of Nebraska or the
city in which the principal office of the Rights Agent is located are
authorized or obligated by law or executive order to close.
(e) "Close of Business" on any given date shall mean 5:00 P.M.,
Omaha, Nebraska time, on such date; provided, however, that if such date is
not a Business Day it shall mean 5:00 P.M., Omaha, Nebraska time, on the next
succeeding Business Day.
(f) "Common Stock" when used with reference to the Company shall
mean the Common Stock, presently par value $5.00 per share, of the Company.
"Common Stock" when used with reference to any Person other than the Company
shall mean the common stock (or, in the case of an unincorporated entity, the
equivalent equity interest) with the greatest voting power of such other
Person or, if such other Person is a subsidiary of another Person, the Person
or Persons which ultimately control such first-mentioned Person.
(g) "Common Stock Equivalents" shall have the meaning set forth
in Section 11(a)(iii) hereof.
(h) "Current Value" shall have the meaning set forth in Section
11(a)(iii) hereof.
(i) "Distribution Date" shall have the meaning set forth in
Section 3 hereof.
(j) "Equivalent Preferred Shares" shall have the meaning set
forth in Section 11(b) hereof.
(k) "Exempt Person" shall mean the Company or any Subsidiary (as
such term is hereinafter defined) of the Company, in each case including,
without limitation, in its fiduciary capacity, or any employee benefit plan of
the Company or of any Subsidiary of the Company, or any entity or trustee
holding Common Stock for or pursuant to the terms of any such plan or for the
purpose of funding any such plan or funding other employee benefits for
employees of the Company or of any Subsidiary of the Company.
(l) "Exchange Ratio" shall have the meaning set forth in Section
24 hereof.
(m) "Expiration Date" shall have the meaning set forth in
Section 7 hereof.
(n) "Flip-In Event" shall have the meaning set forth in Section
11(a)(ii) hereof.
(o) "Final Expiration Date" shall have the meaning set forth in
Section 7 hereof.
(p) "NASDAQ" shall mean The NASDAQ Stock Market.
(q) "New York Stock Exchange" shall mean the New York Stock
Exchange, Inc.
(r) "Person" shall mean any individual, firm, corporation,
partnership, limited liability company, trust or other entity, and shall
include any successor (by merger or otherwise) to such entity.
(s) "Preferred Stock" shall mean the Series A Junior
Participating Class E Preferred Stock, without par value, of the
Company having the rights and preferences set forth in the Form
of Certificate of Designation attached to this Agreement as
Exhibit A.
(t) "Principal Party" shall have the meaning set forth
in Section 13(b) hereof.
(u) "Redemption Date" shall have the meaning set forth
in Section 7 hereof.
(v) "Redemption Price" shall have the meaning set
forth in Section 23 hereof.
(w) "Right Certificate" shall have the meaning set
forth in Section 3 hereof.
(x) "Securities Act" shall mean the Securities Act of
1933, as amended.
(y) "Section 11(a)(ii) Trigger Date" shall have the
meaning set forth in Section 11(a)(iii) hereof.
(z) "Spread" shall have the meaning set forth in
Section 11(a)(iii) hereof.
(aa) "Stock Acquisition Date" shall mean the first date
of public announcement (which, for purposes of this definition,
shall include, without limitation, a report filed pursuant to
Section 13(d) of the Exchange Act) by the Company or an Acquiring
Person that an Acquiring Person has become such, or such earlier
date as a majority of the Board of Directors shall become aware
of the existence of an Acquiring Person.
(bb) "Subsidiary" of any Person shall mean any
corporation or other entity of which securities or other
ownership interests having ordinary voting power sufficient to
elect a majority of the board of directors or other persons
performing similar functions are beneficially owned, directly or
indirectly, by such Person, and any corporation or other entity
that is otherwise controlled by such Person.
(cc) "Substitution Period" shall have the meaning set
forth in Section 11(a)(iii) hereof.
(dd) "Summary of Rights" shall have the meaning set
forth in Section 3 hereof.
(ee) "Trading Day" shall have the meaning set forth in
Section 11(d)(i) hereof.
Section 2. Appointment of Rights Agent. The Company
hereby appoints the Rights Agent to act as agent for the Company
and the holders of the Rights (who, in accordance with Section 3
hereof, shall prior to the Distribution Date be the holders of
Common Stock) in accordance with the terms and conditions hereof,
and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such co-Rights Agents as it
may deem necessary or desirable.
Section 3. Issue of Right Certificates.
(a) Until the Close of Business on the earlier of (i)
the tenth day after the Stock Acquisition Date or (ii) the tenth
Business Day (or such later date as may be determined by action
of the Board of Directors prior to such time as any Person
becomes an Acquiring Person) after the date of the commencement
by any Person (other than an Exempt Person) of, or of the first
public announcement of the intention of such Person (other than
an Exempt Person) to commence, a tender or exchange offer the
consummation of which would result in any Person (other than an
Exempt Person) becoming the Beneficial Owner of shares of Common
Stock aggregating 15% or more of the Common Stock then
outstanding (the earlier of such dates being herein referred to
as the "Distribution Date", provided, however, that if either of
such dates occurs after the date of this Agreement and on or
prior to the Record Date, then the Distribution Date shall be the
Record Date), (x) the Rights will be evidenced (subject to the
provisions of Section 3(b) hereof) by the certificates for Common
Stock registered in the names of the holders thereof and not by
separate Right Certificates, and (y) the Rights will be
transferable only in connection with the transfer of Common
Stock. As soon as practicable after the Distribution Date, the
Company will prepare and execute, the Rights Agent will
countersign and the Company will send or cause to be sent (and
the Rights Agent will, if requested, send) by first-class,
insured, postage-prepaid mail, to each record holder of Common
Stock as of the close of business on the Distribution Date (other
than any Acquiring Person or any Associate or Affiliate of an
Acquiring Person), at the address of such holder shown on the
records of the Company, a Right Certificate, in substantially the
form of Exhibit B hereto (a "Right Certificate"), evidencing one
Right (subject to adjustment as provided herein) for each share
of Common Stock so held. As of the Distribution Date, the Rights
will be evidenced solely by such Right Certificates.
(b) On the Record Date, or as soon as practicable
thereafter, the Company will send a copy of a Summary of Rights
to Purchase Shares of Preferred Stock, in substantially the form
of Exhibit C hereto (the "Summary of Rights"), by first-class,
postage-prepaid mail, to each record holder of Common Stock as of
the Close of Business on the Record Date (other than any
Acquiring Person or any Associate or Affiliate of any Acquiring
Person), at the address of such holder shown on the records of
the Company. With respect to certificates for Common Stock
outstanding as of the Record Date, until the Distribution Date,
the Rights will be evidenced by such certificates registered in
the names of the holders thereof together with the Summary of
Rights. Until the Distribution Date (or, if earlier, the
Expiration Date), the surrender for transfer of any certificate
for Common Stock outstanding on the Record Date, with or without
a copy of the Summary of Rights, shall also constitute the
transfer of the Rights associated with the Common Stock
represented thereby.
(c) Certificates issued for Common Stock (including,
without limitation, upon transfer of outstanding Common Stock,
disposition of Common Stock out of treasury stock or issuance or
reissuance of Common Stock out of authorized but unissued shares)
after the Record Date but prior to the earlier of the
Distribution Date and the Expiration Date shall have impressed
on, printed on, written on or otherwise affixed to them the
following legend:
This certificate also evidences and entitles
the holder hereof to certain rights as set
forth in a Rights Agreement between ConAgra,
Inc. and ChaseMellon Shareholder Services,
L.L.C., as Rights Agent, dated as of July 12,
1996 as the same may be amended from time to
time (the "Rights Agreement"), the terms of
which are hereby incorporated herein by
reference and a copy of which is on file at
the principal executive offices of ConAgra,
Inc. Under certain circumstances, as set
forth in the Rights Agreement, such Rights
will be evidenced by separate certificates
and will no longer be evidenced by this
certificate. ConAgra, Inc. will mail to the
holder of this certificate a copy of the
Rights Agreement without charge after receipt
of a written request therefor. Under certain
circumstances, as set forth in the Rights
Agreement, Rights owned by or transferred to
any Person who is or becomes an Acquiring
Person (as defined in the Rights Agreement)
and certain transferees thereof will become
null and void and will no longer be
transferable.
With respect to such certificates containing the foregoing
legend, until the Distribution Date the Rights associated with
the Common Stock represented by such certificates shall be
evidenced by such certificates alone, and the surrender for
transfer of any such certificate, except as otherwise provided
herein, shall also constitute the transfer of the Rights
associated with the Common Stock represented thereby. In the
event that the Company purchases or otherwise acquires any Common
Stock after the Record Date but prior to the Distribution Date,
any Rights associated with such Common Stock shall be deemed
canceled and retired so that the Company shall not be entitled to
exercise any Rights associated with the Common Stock which are no
longer outstanding.
Notwithstanding this paragraph (c), the omission of a
legend shall not affect the enforceability of any part of this
Agreement or the rights of any holder of the Rights.
Section 4. Form of Right Certificates. The Right
Certificates (and the forms of election to purchase shares and of
assignment to be printed on the reverse thereof) shall be
substantially in the form set forth in Exhibit B hereto and may
have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company
may deem appropriate and as are not inconsistent with the
provisions of this Agreement, or as may be required to comply
with any applicable law or with any rule or regulation made
pursuant thereto or with any rule or regulation of any stock
exchange or interdealer quotation system on which the Rights may
from time to time be listed or quoted, or to conform to usage.
Subject to the provisions of Sections 11, 13 and 22 hereof, the
Right Certificates shall entitle the holders thereof to purchase
such number of one one-thousandths of a share of Preferred Stock
as shall be set forth therein at the price per one one-thousandth
of a share of Preferred Stock set forth therein (the "Purchase
Price"), but the number of such one one-thousandths of a share of
Preferred Stock and the Purchase Price shall be subject to
adjustment as provided herein.
Section 5. Countersignature and Registration.
(a) The Right Certificates shall be executed on behalf
of the Company by the Chief Executive Officer of the Company,
either manually or by facsimile signature, shall have affixed
thereto the Company's seal or a facsimile thereof and shall be
attested by the Secretary of the Company, either manually or by
facsimile signature. The Right Certificates shall be manually
countersigned by the Rights Agent and shall not be valid for any
purpose unless countersigned. In case any officer of the Company
who shall have signed any of the Right Certificates shall cease
to be such officer of the Company before countersignature by the
Rights Agent and issuance and delivery by the Company, such Right
Certificates, nevertheless, may be countersigned by the Rights
Agent and issued and delivered by the Company with the same force
and effect as though the Person who signed such Right
Certificates had not ceased to be such officer of the Company;
and any Right Certificate may be signed on behalf of the Company
by any Person who, at the actual date of the execution of such
Right Certificate, shall be a proper officer of the Company to
sign such Right Certificate, although at the date of the
execution of this Agreement any such Person was not such an
officer.
(b) Following the Distribution Date, the Rights Agent
will keep or cause to be kept, at an office or agency designated
for such purpose, books for registration and transfer of the
Right Certificates issued hereunder. Such books shall show the
names and addresses of the respective holders of the Right
Certificates, the number of Rights evidenced on its face by each
of the Right Certificates and the date of each of the Right
Certificates.
Section 6. Transfer, Split Up, Combination and
Exchange of Right Certificates; Mutilated, Destroyed, Lost or
Stolen Right Certificates.
(a) Subject to the provisions of Sections 7(e),
11(a)(ii), 13 and 14 hereof, at any time after the Distribution
Date and prior to the Expiration Date, any Right Certificate or
Right Certificates may be transferred, split up, combined or
exchanged for another Right Certificate or Right Certificates,
entitling the registered holder to purchase a like number of one
one-thousandths of a share of Preferred Stock as the Right
Certificate or Right Certificates surrendered then entitled such
holder to purchase. Any registered holder desiring to transfer,
split up, combine or exchange any Right Certificate or Right
Certificates shall make such request in writing delivered to the
Rights Agent, and shall surrender the Right Certificate or Right
Certificates to be transferred, split up, combined or exchanged
at the office or agency of the Rights Agent designated for such
purpose. Thereupon the Rights Agent shall countersign and
deliver to the Person entitled thereto a Right Certificate or
Right Certificates, as the case may be, as so requested. The
Company may require payment of a sum sufficient to cover any tax
or governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Right
Certificates.
(b) Subject to the provisions of Section 11(a)(ii)
hereof, at any time after the Distribution Date and prior to the
Expiration Date, upon receipt by the Company and the Rights Agent
of evidence reasonably satisfactory to them of the loss, theft,
destruction or mutilation of a Right Certificate, and, in case of
loss, theft or destruction, of indemnity or security reasonably
satisfactory to them, and, at the Company's request,
reimbursement to the Company and the Rights Agent of all
reasonable expenses incidental thereto, and upon surrender to the
Rights Agent and cancellation of the Right Certificate if
mutilated, the Company will make and deliver a new Right
Certificate of like tenor to the Rights Agent for delivery to the
registered holder in lieu of the Right Certificate so lost,
stolen, destroyed or mutilated.
Section 7. Exercise of Rights, Purchase Price;
Expiration Date of Rights.
(a) Except as otherwise provided herein, the Rights
shall become exercisable on the Distribution Date, and thereafter
the registered holder of any Right Certificate may, subject to
Section 11(a)(ii) hereof and except as otherwise provided herein,
exercise the Rights evidenced thereby in whole or in part upon
surrender of the Right Certificate, with the form of election to
purchase on the reverse side thereof duly executed, to the Rights
Agent at the office or agency of the Rights Agent designated for
such purpose, together with payment of the aggregate Purchase
Price with respect to the total number of one one-thousandths of
a share of Preferred Stock (or other securities, cash or other
assets, as the case may be) as to which the Rights are exercised,
at any time which is both after the Distribution Date and prior
to the time (the "Expiration Date") that is the earliest of (i)
the Close of Business on July 12, 2006 (the "Final Expiration
Date"), (ii) the time at which the Rights are redeemed as
provided in Section 23 hereof (the "Redemption Date") or (iii)
the time at which such Rights are exchanged as provided in
Section 24 hereof.
(b) The Purchase Price shall be initially $200.00 for
each one one-thousandth of a share of Preferred Stock purchasable
upon the exercise of a Right. The Purchase Price and the number
of one one-thousandths of a share of Preferred Stock or other
securities or property to be acquired upon exercise of a Right
shall be subject to adjustment from time to time as provided in
Sections 11 and 13 hereof and shall be payable in lawful money of
the United States of America in accordance with paragraph (c) of
this Section 7.
(c) Except as otherwise provided herein, upon receipt
of a Right Certificate representing exercisable Rights, with the
form of election to purchase duly executed, accompanied by
payment of the aggregate Purchase Price for the shares of
Preferred Stock to be purchased and an amount equal to any
applicable transfer tax required to be paid by the holder of such
Right Certificate in accordance with Section 9 hereof, in cash or
by certified check, cashier's check or money order payable to the
order of the Company, the Rights Agent shall thereupon promptly
(i) (A) requisition from any transfer agent of the Preferred
Stock certificates for the number of shares of Preferred Stock to
be purchased and the Company hereby irrevocably authorizes its
transfer agent to comply with all such requests, or (B)
requisition from the depositary agent depositary receipts
representing interests in such number of one one-thousandths of a
share of Preferred Stock as are to be purchased (in which case
certificates for the Preferred Stock represented by such receipts
shall be deposited by the transfer agent with the depositary
agent) and the Company hereby directs the depositary agent to
comply with such request, (ii) when appropriate, requisition from
the Company the amount of cash to be paid in lieu of issuance of
fractional shares in accordance with Section 14 hereof, (iii)
promptly after receipt of such certificates or depositary
receipts, cause the same to be delivered to or upon the order of
the registered holder of such Right Certificate, registered in
such name or names as may be designated by such holder and (iv)
when appropriate, after receipt, promptly deliver such cash to or
upon the order of the registered holder of such Right
Certificate.
(d) Except as otherwise provided herein, in case the
registered holder of any Right Certificate shall exercise less
than all of the Rights evidenced thereby, a new Right Certificate
evidencing Rights equivalent to the exercisable Rights remaining
unexercised shall be issued by the Rights Agent to the registered
holder of such Right Certificate or to his duly authorized
assigns, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be
obligated to undertake any action with respect to a registered
holder of Rights upon the occurrence of any purported transfer or
exercise of Rights pursuant to Section 6 hereof or this Section 7
unless such registered holder shall have (i) completed and signed
the certificate contained in the form of assignment or form of
election to purchase set forth on the reverse side of the Rights
Certificate surrendered for such transfer or exercise and (ii)
provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) thereof as the
Company shall reasonably request.
Section 8. Cancellation and Destruction of Right
Certificates. All Right Certificates surrendered for the purpose
of exercise, transfer, split up, combination or exchange shall,
if surrendered to the Company or to any of its agents, be
delivered to the Rights Agent for cancellation or in canceled
form, or, if surrendered to the Rights Agent, shall be canceled
by it, and no Right Certificates shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this
Agreement. The Company shall deliver to the Rights Agent for
cancellation and retirement, and the Rights Agent shall so cancel
and retire, any other Right Certificate purchased or acquired by
the Company otherwise than upon the exercise thereof. The Rights
Agent shall deliver all canceled Right Certificates to the
Company, or shall, at the written request of the Company, destroy
such canceled Right Certificates, and in such case shall deliver
a certificate of destruction thereof to the Company.
Section 9. Availability of Shares of Preferred Stock.
(a) The Company covenants and agrees that it will
cause to be reserved and kept available out of its authorized and
unissued shares of Preferred Stock or any shares of Preferred
Stock held in its treasury, the number of shares of Preferred
Stock that will be sufficient to permit the exercise in full of
all outstanding Rights.
(b) So long as the shares of Preferred Stock (and,
following the time that any Person becomes an Acquiring Person,
shares of Common Stock and other securities) issuable upon the
exercise of Rights may be listed or admitted to trading on any
national securities exchange, or quoted on NASDAQ, the Company
shall use its best efforts to cause, from and after such time as
the Rights become exercisable, all shares reserved for such
issuance to be listed or admitted to trading on such exchange, or
quoted on NASDAQ, upon official notice of issuance upon such
exercise.
(c) From and after such time as the Rights become
exercisable, the Company shall use its best efforts, if then
necessary to permit the issuance of shares of Preferred Stock
(and, following the time that any Person becomes an Acquiring
Person, shares of Common Stock and other securities) upon the
exercise of Rights, to register and qualify such shares of
Preferred Stock (and, following the time that any Person becomes
an Acquiring Person, shares of Common Stock and other securities)
under the Securities Act and any applicable state securities or
"Blue Sky" laws (to the extent exemptions therefrom are not
available), cause such registration statement and qualifications
to become effective as soon as possible after such filing and
keep such registration and qualifications effective until the
earlier of the date as of which the Rights are no longer
exercisable for such securities and the Expiration Date. The
Company may temporarily suspend, for a period of time not to
exceed 90 days, the exercisability of the Rights in order to
prepare and file a registration statement under the Securities
Act and permit it to become effective. Upon any such suspension,
the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as
well as a public announcement at such time as the suspension is
no longer in effect. Notwithstanding any provision of this
Agreement to the contrary, the Rights shall not be exercisable in
any jurisdiction unless the requisite qualification in such
jurisdiction shall have been obtained and until a registration
statement under the Securities Act (if required) shall have been
declared effective.
(d) The Company covenants and agrees that it will take
all such action as may be necessary to ensure that all shares of
Preferred Stock (and, following the time that any Person becomes
an Acquiring Person, shares of Common Stock and other securities)
delivered upon exercise of Rights shall, at the time of delivery
of the certificates therefor (subject to payment of the Purchase
Price), be duly and validly authorized and issued and fully paid
and nonassessable shares.
(e) The Company further covenants and agrees that it
will pay when due and payable any and all federal and state
transfer taxes and charges which may be payable in respect of the
issuance or delivery of the Right Certificates or of any shares
of Preferred Stock (or shares of Common Stock or other
securities) upon the exercise of Rights. The Company shall not,
however, be required to pay any transfer tax which may be payable
in respect of any transfer or delivery of Right Certificates to a
Person other than, or the issuance or delivery of certificates or
depositary receipts for the Preferred Stock (or shares of Common
Stock or other securities) in a name other than that of, the
registered holder of the Right Certificate evidencing Rights
surrendered for exercise or to issue or deliver any certificates
or depositary receipts for Preferred Stock (or shares of Common
Stock or other securities) upon the exercise of any Rights until
any such tax shall have been paid (any such tax being payable by
that holder of such Right Certificate at the time of surrender)
or until it has been established to the Company's reasonable
satisfaction that no such tax is due.
Section 10. Preferred Stock Record Date. Each Person
in whose name any certificate for Preferred Stock is issued upon
the exercise of Rights shall for all purposes be deemed to have
become the holder of record of the shares of Preferred Stock
represented thereby on, and such certificate shall be dated, the
date upon which the Right Certificate evidencing such Rights was
duly surrendered and payment of the Purchase Price (and any
applicable transfer taxes) was made; provided, however, that if
the date of such surrender and payment is a date upon which the
Preferred Stock transfer books of the Company are closed, such
Person shall be deemed to have become the record holder of such
shares on, and such certificate shall be dated, the next
succeeding Business Day on which the Preferred Stock transfer
books of the Company are open. Prior to the exercise of the
Rights evidenced thereby, the holder of a Right Certificate shall
not be entitled to any rights of a holder of Preferred Stock for
which the Rights shall be exercisable, including, without
limitation, the right to vote or to receive dividends or other
distributions, and shall not be entitled to receive any notice of
any proceedings of the Company, except as provided herein.
Section 11. Adjustment of Purchase Price, Number and
Kind of Shares and Number of Rights. The Purchase Price, the
number of shares of Preferred Stock or other securities or
property purchasable upon exercise of each Right and the number
of Rights outstanding are subject to adjustment from time to time
as provided in this Section 11.
(a)(i) In the event the Company shall at any time
after the date of this Agreement (A) declare and pay a dividend
on the Preferred Stock payable in shares of Preferred Stock, (B)
subdivide the outstanding Preferred Stock, (C) combine the
outstanding Preferred Stock into a smaller number of shares of
Preferred Stock or (D) issue any shares of its capital stock in a
reclassification of the Preferred Stock (including any such
reclassification in connection with a consolidation or merger in
which the Company is the continuing or surviving corporation),
except as otherwise provided in this Section 11(a), the Purchase
Price in effect at the time of the record date for such dividend
or of the effective date of such subdivision, combination or
reclassification, and the number and kind of shares of capital
stock issuable on such date, shall be proportionately adjusted so
that the holder of any Right exercised after such time shall be
entitled to receive the aggregate number and kind of shares of
capital stock which, if such Right had been exercised immediately
prior to such date and at a time when the Preferred Stock
transfer books of the Company were open, the holder would have
owned upon such exercise and been entitled to receive by virtue
of such dividend, subdivision, combination or reclassification;
provided, however, that in no event shall the consideration to be
paid upon the exercise of one Right be less than the aggregate
par value of the shares of capital stock of the Company issuable
upon exercise of one Right.
(ii) Subject to Section 24 of this Agreement, in the
event any Person becomes an Acquiring Person (the first
occurrence of such event being referred to hereinafter as the
"Flip-In Event"), then (A) the Purchase Price shall be adjusted
to be the Purchase Price in effect immediately prior to the Flip-
In Event multiplied by the number of one one-thousandths of a
share of Preferred Stock for which a Right was exercisable
immediately prior to such Flip-In Event, whether or not such
Right was then exercisable, and (B) each holder of a Right,
except as otherwise provided in this Section 11(a)(ii) and
Section 11(a)(iii) hereof, shall thereafter have the right to
receive, upon exercise thereof at a price equal to the Purchase
Price (as so adjusted), in accordance with the terms of this
Agreement and in lieu of shares of Preferred Stock, such number
of shares of Common Stock as shall equal the result obtained by
dividing the Purchase Price (as so adjusted) by 50% of the
current per share market price of the Common Stock (determined
pursuant to Section 11(d) hereof) on the date of such Flip-In
Event; provided, however, that the Purchase Price (as so
adjusted) and the number of shares of Common Stock so receivable
upon exercise of a Right shall, following the Flip-In Event, be
subject to further adjustment as appropriate in accordance with
Section 11(f) hereof. Notwithstanding anything in this Agreement
to the contrary, however, from and after the Flip-In Event, any
Rights that are beneficially owned by (x) any Acquiring Person
(or any Affiliate or Associate of any Acquiring Person), (y) a
transferee of any Acquiring Person (or any such Affiliate or
Associate) who becomes a transferee after the Flip-In Event or
(z) a transferee of any Acquiring Person (or any such Affiliate
or Associate) who became a transferee prior to or concurrently
with the Flip-In Event pursuant to either (I) a transfer from the
Acquiring Person to holders of its equity securities or to any
Person with whom it has any continuing agreement, arrangement or
understanding regarding the transferred Rights or (II) a transfer
which the Board of Directors has determined is part of a plan,
arrangement or understanding which has the purpose or effect of
avoiding the provisions of this paragraph, and subsequent
transferees of such Persons, shall be void without any further
action and any holder of such Rights shall thereafter have no
rights whatsoever with respect to such Rights under any provision
of this Agreement. The Company shall use all reasonable efforts
to ensure that the provisions of this Section 11(a)(ii) are
complied with, but shall have no liability to any holder of Right
Certificates or other Person as a result of its failure to make
any determinations with respect to an Acquiring Person or its
Affiliates, Associates or transferees hereunder. From and after
the Flip-In Event, no Right Certificate shall be issued pursuant
to Section 3 or Section 6 hereof that represents Rights that are
or have become void pursuant to the provisions of this paragraph,
and any Right Certificate delivered to the Rights Agent that
represents Rights that are or have become void pursuant to the
provisions of this paragraph shall be canceled. From and after
the occurrence of an event specified in Section 13(a) hereof, any
Rights that theretofore have not been exercised pursuant to this
Section 11(a)(ii) shall thereafter be exercisable only in
accordance with Section 13 and not pursuant to this Section
11(a)(ii).
(iii) The Company may at its option substitute for
a share of Common Stock issuable upon the exercise of Rights in
accordance with the foregoing subparagraph (ii) a number of
shares of Preferred Stock or fraction thereof such that the
current per share market price of one share of Preferred Stock
multiplied by such number or fraction is equal to the current per
share market price of one share of Common Stock. In the event
that there shall not be sufficient shares of Common Stock issued
but not outstanding or authorized but unissued to permit the
exercise in full of the Rights in accordance with the foregoing
subparagraph (ii), the Board of Directors shall, to the extent
permitted by applicable law and any material agreements then in
effect to which the Company is a party (A) determine the excess
(such excess, the "Spread") of (1) the value of the shares of
Common Stock issuable upon the exercise of a Right in accordance
with the foregoing subparagraph (ii) (the "Current Value") over
(2) the Purchase Price (as adjusted in accordance with the
foregoing subparagraph (ii)), and (B) with respect to each Right
(other than Rights which have become void pursuant to the
foregoing subparagraph (ii)), make adequate provision to
substitute for the shares of Common Stock issuable in accordance
with the foregoing subparagraph (ii) upon exercise of the Right
and payment of the Purchase Price (as adjusted in accordance
therewith), (1) cash, (2) a reduction in such Purchase Price, (3)
shares of Preferred Stock or other equity securities of the
Company (including, without limitation, shares or fractions of
shares of preferred stock which, by virtue of having dividend,
voting and liquidation rights substantially comparable to those
of the shares of Common Stock, are deemed in good faith by the
Board of Directors to have substantially the same value as the
shares of Common Stock (such shares of Preferred Stock and shares
or fractions of shares of preferred stock are hereinafter
referred to as "Common Stock Equivalents")), (4) debt securities
of the Company, (5) other assets, or (6) any combination of the
foregoing, having a value which, when added to the value of the
shares of Common Stock issued upon exercise of such Right, shall
have an aggregate value equal to the Current Value (less the
amount of any reduction in such Purchase Price), where such
aggregate value has been determined by the Board of Directors
upon the advice of a nationally recognized investment banking
firm selected in good faith by the Board of Directors; provided,
however, that if the Company shall not make adequate provision to
deliver value pursuant to clause (B) above within thirty (30)
days following the Flip-In Event (the "Section 11(a) (ii) Trigger
Date"), then the Company shall be obligated to deliver, to the
extent permitted by applicable law and any material agreements
then in effect to which the Company is a party, upon the
surrender for exercise of a Right and without requiring payment
of such Purchase Price, shares of Common Stock (to the extent
available), and then, if necessary, such number or fractions of
shares of Preferred Stock (to the extent available) and then, if
necessary, cash, which shares and/or cash have an aggregate value
equal to the Spread. If, upon the occurrence of the Flip-In
Event, the Board of Directors shall determine in good faith that
it is likely that sufficient additional shares of Common Stock
could be authorized for issuance upon exercise in full of the
Rights, then, if the Board of Directors so elects, the thirty
(30) day period set forth above may be extended to the extent
necessary, but not more than ninety (90) days after the Section
11(a) (ii) Trigger Date, in order that the Company may seek
stockholder approval for the authorization of such additional
shares (such thirty (30) day period, as it may be extended, is
herein called the "Substitution Period"). To the extent that the
Company determines that some action need be taken pursuant to the
second and/or third sentence of this Section 11(a)(iii), the
Company (x) shall provide, subject to Section 11(a)(ii) hereof
and the last sentence of this Section 11(a)(iii) hereof, that
such action shall apply uniformly to all outstanding Rights and
(y) may suspend the exercisability of the Rights until the
expiration of the Substitution Period in order to seek any
authorization of additional shares and/or to decide the
appropriate form of distribution to be made pursuant to such
second sentence and to determine the value thereof. In the event
of any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has
been temporarily suspended, as well as a public announcement at
such time as the suspension is no longer in effect. For purposes
of this Section 11(a)(iii), the value of the shares of Common
Stock shall be the current per share market price (as determined
pursuant to Section 11(d)(i)) on the Section 11(a)(ii) Trigger
Date and the per share or fractional value of any "Common Stock
Equivalent" shall be deemed to equal the current per share market
price of the Common Stock. The Board of Directors of the Company
may, but shall not be required to, establish procedures to
allocate the right to receive shares of Common Stock upon the
exercise of the Rights among holders of Rights pursuant to this
Section 11(a)(iii).
(b) In case the Company shall fix a record date for
the issuance of rights, options or warrants to all holders of
Preferred Stock entitling them (for a period expiring within 45
calendar days after such record date) to subscribe for or
purchase Preferred Stock (or shares having the same rights,
privileges and preferences as the Preferred Stock ("equivalent
preferred shares")) or securities convertible into Preferred
Stock or equivalent preferred shares at a price per share of
Preferred Stock or equivalent preferred shares (or having a
conversion price per share, if a security convertible into shares
of Preferred Stock or equivalent preferred shares) less than the
then current per share market price of the Preferred Stock
(determined pursuant to Section 11(d) hereof) on such record
date, the Purchase Price to be in effect after such record date
shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the
numerator of which shall be the number of shares of Preferred
Stock and equivalent preferred shares outstanding on such record
date plus the number of shares of Preferred Stock and equivalent
preferred shares which the aggregate offering price of the total
number of shares of Preferred Stock and/or equivalent preferred
shares so to be offered (and/or the aggregate initial conversion
price of the convertible securities so to be offered) would
purchase at such current market price, and the denominator of
which shall be the number of shares of Preferred Stock and
equivalent preferred shares outstanding on such record date plus
the number of additional shares of Preferred Stock and/or
equivalent preferred shares to be offered for subscription or
purchase (or into which the convertible securities so to be
offered are initially convertible); provided, however, that in no
event shall the consideration to be paid upon the exercise of one
Right be less than the aggregate par value of the shares of
capital stock of the Company issuable upon exercise of one Right.
In case such subscription price may be paid in a consideration
part or all of which shall be in a form other than cash, the
value of such consideration shall be as determined in good faith
by the Board of Directors of the Company, whose determination
shall be described in a statement filed with the Rights Agent.
Shares of Preferred Stock and equivalent preferred shares owned
by or held for the account of the Company shall not be deemed
outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date
is fixed; and in the event that such rights, options or warrants
are not so issued, the Purchase Price shall be adjusted to be the
Purchase Price which would then be in effect if such record date
had not been fixed.
(c) In case the Company shall fix a record date for
the making of a distribution to all holders of the Preferred
Stock (including any such distribution made in connection with a
consolidation or merger in which the Company is the continuing or
surviving corporation) of evidences of indebtedness or assets
(other than a regular quarterly cash dividend or a dividend
payable in Preferred Stock) or subscription rights or warrants
(excluding those referred to in Section 11(b) hereof), the
Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the
numerator of which shall be the then current per share market
price of the Preferred Stock (determined pursuant to Section
11(d) hereof) on such record date, less the fair market value (as
determined in good faith by the Board of Directors of the Company
whose determination shall be described in a statement filed with
the Rights Agent) of the portion of the assets or evidences of
indebtedness so to be distributed or of such subscription rights
or warrants applicable to one share of Preferred Stock, and the
denominator of which shall be such current per share market price
(determined pursuant to Section 11(d) hereof) of the Preferred
Stock; provided, however, that in no event shall the
consideration to be paid upon the exercise of one Right be less
than the aggregate par value of the shares of capital stock of
the Company to be issued upon exercise of one Right. Such
adjustments shall be made successively whenever such a record
date is fixed; and in the event that such distribution is not so
made, the Purchase Price shall again be adjusted to be the
Purchase Price which would then be in effect if such record date
had not been fixed.
(d)(i) Except as otherwise provided herein, for the
purpose of any computation hereunder, the "current per share
market price " of any security (a "Security " for the purpose of
this Section 11(d)(i)) on any date shall be deemed to be the
average of the daily closing prices per share of such Security
for the 30 consecutive Trading Days (as such term is hereinafter
defined) immediately prior to such date; provided, however, that
in the event that the current per share market price of the
Security is determined during a period following the announcement
by the issuer of such Security of (A) a dividend or distribution
on such Security payable in shares of such Security or securities
convertible into such shares, or (B) any subdivision, combination
or reclassification of such Security, and prior to the expiration
of 30 Trading Days after the ex-dividend date for such dividend
or distribution, or the record date for such subdivision,
combination or reclassification, then, and in each such case, the
current per share market price shall be appropriately adjusted to
reflect the current market price per share equivalent of such
Security. The closing price for each day shall be the last sale
price, regular way, or, in case no such sale takes place on such
day, the average of the closing bid and asked prices, regular
way, in either case as reported by the principal consolidated
transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock Exchange or, if the
Security is not listed or admitted to trading on the New York
Stock Exchange, as reported in the principal consolidated
transaction reporting system with respect to securities listed on
the principal national securities exchange on which the 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 or, if not so quoted, the average
of the high bid and low asked prices in the over-the-counter
market, as reported by NASDAQ or such other system then in use,
or, if on any such date the 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 of Directors of the Company. The
term "Trading Day" shall mean a day on which the principal
national securities exchange on which the Security is listed or
admitted to trading is open for the transaction of business or,
if the Security is not listed or admitted to trading on any
national securities exchange, a Business Day.
(ii) For the purpose of any computation hereunder, if
the Preferred Stock is publicly traded, the "current per share
market price" of the Preferred Stock shall be determined in
accordance with the method set forth in Section 11(d)(i). If the
Preferred Stock is not publicly traded but the Common Stock is
publicly traded, the "current per share market price" of the
Preferred Stock shall be conclusively deemed to be the current
per share market price of the Common Stock as determined pursuant
to Section 11(d)(i) multiplied by the then applicable Adjustment
Number (as defined in and determined in accordance with the
Certificate of Designation for the Preferred Stock). If neither
the Common Stock nor the Preferred Stock is publicly traded,
"current per share market price" shall mean the fair value per
share as determined in good faith by the Board of Directors of
the Company, whose determination shall be described in a
statement filed with the Rights Agent.
(e) No adjustment in the Purchase Price shall be
required unless such adjustment would require an increase or
decrease of at least 1% in the Purchase Price; provided, however,
that any adjustments which by reason of this Section 11(e) are
not required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under
this Section 11 shall be made to the nearest cent or to the
nearest one hundred-thousandth of a share of Preferred Stock or
one-hundreth of a share of Common Stock or other share or
security as the case may be. Notwithstanding the first sentence
of this Section 11(e), any adjustment required by this Section 11
shall be made no later than the earlier of (i) three years from
the date of the transaction which requires such adjustment or
(ii) the Expiration Date.
(f) If as a result of an adjustment made pursuant to
Section 11(a) hereof, the holder of any Right thereafter
exercised shall become entitled to receive any shares of capital
stock of the Company other than the Preferred Stock, thereafter
the Purchase Price and the number of such other shares so
receivable upon exercise of a Right shall be subject to
adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to the
Preferred Stock contained in Sections 11(a), 11(b), 11(c), 11(e),
11(h), 11(i) and 11(m) hereof, as applicable, and the provisions
of Sections 7, 9, 10, 13 and 14 hereof with respect to the
Preferred Stock shall apply on like terms to any such other
shares.
(g) All Rights originally issued by the Company
subsequent to any adjustment made to the Purchase Price hereunder
shall evidence the right to purchase, at the adjusted Purchase
Price, the number of one one-thousandths of a share of Preferred
Stock purchasable from time to time hereunder upon exercise of
the Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its
election as provided in Section 11(i), upon each adjustment of
the Purchase Price as a result of the calculations made in
Sections 11(b) and (c), each Right outstanding immediately prior
to the making of such adjustment shall thereafter evidence the
right to purchase, at the adjusted Purchase Price, that number of
one one-thousandths of a share of Preferred Stock (calculated to
the nearest one hundred-thousandth of a share of Preferred Stock)
obtained by (i) multiplying (x) the number of one one-thousandths
of a share purchasable upon the exercise of a Right immediately
prior to such adjustment by (y) the Purchase Price in effect
immediately prior to such adjustment of the Purchase Price and
(ii) dividing the product so obtained by the Purchase Price in
effect immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any
adjustment of the Purchase Price pursuant to Sections 11(b) or
11(c) hereof to adjust the number of Rights, in substitution for
any adjustment in the number of one one-thousandths of a share of
Preferred Stock purchasable upon the exercise of a Right. Each
of the Rights outstanding after such adjustment of the number of
Rights shall be exercisable for the number of one one-thousandths
of a share of Preferred Stock for which a Right was exercisable
immediately prior to such adjustment. Each Right held of record
prior to such adjustment of the number of Rights shall become
that number of Rights (calculated to the nearest one-hundredth)
obtained by dividing the Purchase Price in effect immediately
prior to adjustment of the Purchase Price by the Purchase Price
in effect immediately after adjustment of the Purchase Price.
The Company shall make a public announcement of its election to
adjust the number of Rights, indicating the record date for the
adjustment, and, if known at the time, the amount of the
adjustment to be made. This record date may be the date on which
the Purchase Price is adjusted or any day thereafter, but, if the
Right Certificates have been issued, shall be at least 10 days
later than the date of the public announcement. If Right
Certificates have been issued, upon each adjustment of the number
of Rights pursuant to this Section 11(i), the Company may, as
promptly as practicable, cause to be distributed to holders of
record of Right Certificates on such record date Right
Certificates evidencing, subject to Section 14 hereof, the
additional Rights to which such holders shall be entitled as a
result of such adjustment, or, at the option of the Company,
shall cause to be distributed to such holders of record in
substitution and replacement for the Right Certificates held by
such holders prior to the date of adjustment, and upon surrender
thereof, if required by the Company, new Right Certificates
evidencing all the Rights to which such holders shall be entitled
after such adjustment. Right Certificates so to be distributed
shall be issued, executed and countersigned in the manner
provided for herein and shall be registered in the names of the
holders of record of Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the
Purchase Price or the number of one one-thousandths of a share of
Preferred Stock issuable upon the exercise of a Right, the Right
Certificates theretofore and thereafter issued may continue to
express the Purchase Price and the number of one one-thousandths
of a share of Preferred Stock which were expressed in the initial
Right Certificates issued hereunder.
(k) Before taking any action that would cause an
adjustment reducing the Purchase Price below the then par value,
if any, of the fraction of Preferred Stock or other shares of
capital stock issuable upon exercise of a Right, the Company
shall take any corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and
legally issue fully paid and nonassessable shares of Preferred
Stock or other such shares at such adjusted Purchase Price.
(l) In any case in which this Section 11 shall require
that an adjustment in the Purchase Price be made effective as of
a record date for a specified event, the Company may elect to
defer until the occurrence of such event issuing to the holder of
any Right exercised after such record date the Preferred Stock
and other capital stock or securities of the Company, if any,
issuable upon such exercise over and above the Preferred Stock
and other capital stock or securities of the Company, if any,
issuable upon such exercise on the basis of the Purchase Price in
effect prior to such adjustment; provided, however, that the
Company shall deliver to such holder a due bill or other
appropriate instrument evidencing such holder's right to receive
such additional shares upon the occurrence of the event requiring
such adjustment.
(m) Anything in this Section 11 to the contrary
notwithstanding, the Company shall be entitled to make such
adjustments in the Purchase Price, in addition to those
adjustments expressly required by this Section 11, as and to the
extent that it in its sole discretion shall determine to be
advisable in order that any consolidation or subdivision of the
Preferred Stock, issuance wholly for cash of any shares of
Preferred Stock at less than the current market price, issuance
wholly for cash of Preferred Stock or securities which by their
terms are convertible into or exchangeable for Preferred Stock,
dividends on Preferred Stock payable in shares of Preferred Stock
or issuance of rights, options or warrants referred to
hereinabove in Section 11(b), hereafter made by the Company to
holders of its Preferred Stock shall not be taxable to such
stockholders.
(n) Anything in this Agreement to the contrary
notwithstanding, in the event that at any time after the date of
this Rights Agreement and prior to the Distribution Date, the
Company shall (i) declare and pay any dividend on the Common
Stock payable in Common Stock or (ii) effect a subdivision,
combination or consolidation of the Common Stock (by
reclassification or otherwise than by payment of a dividend
payable in Common Stock) into a greater or lesser number of
shares of Common Stock, then, in each such case, the number of
Rights associated with each share of Common Stock then
outstanding, or issued or delivered thereafter, shall be
proportionately adjusted so that the number of Rights thereafter
associated with each share of Common Stock following any such
event shall equal the result obtained by multiplying the number
of Rights associated with each share of Common Stock immediately
prior to such event by a fraction the numerator of which shall be
the total number of shares of Common Stock outstanding
immediately prior to the occurrence of the event and the
denominator of which shall be the total number of shares of
Common Stock outstanding immediately following the occurrence of
such event.
(o) The Company agrees that, after the earlier of the
Distribution Date or the Stock Acquisition Date, it will not,
except as permitted by Sections 23, 24 or 27 hereof, take (or
permit any Subsidiary to take) any action if at the time such
action is taken it is reasonably foreseeable that such action
will diminish substantially or eliminate the benefits intended to
be afforded by the Rights.
Section 12. Certificate of Adjusted Purchase Price or
Number of Shares. Whenever an adjustment is made as provided in
Section 11 or 13 hereof, the Company shall promptly (a) prepare a
certificate setting forth such adjustment, and a brief statement
of the facts accounting for such adjustment, (b) file with the
Rights Agent and with each transfer agent for the Common Stock
and the Preferred Stock a copy of such certificate and (c) mail a
brief summary thereof to each holder of a Right Certificate in
accordance with Section 25 hereof (if so required under Section
25 hereof). The Rights Agent shall be fully protected in relying
on any such certificate and on any adjustment therein contained
and shall not be deemed to have knowledge of any such adjustment
unless and until it shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer
of Assets or Earning Power.
(a) In the event, directly or indirectly, at any time
after the Flip-In Event (i) the Company shall consolidate with or
shall merge into any other Person, (ii) any Person shall merge
with and into the Company and the Company shall be the continuing
or surviving corporation of such merger and, in connection with
such merger, all or part of the Common Stock shall be changed
into or exchanged for stock or other securities of any other
Person (or of the Company) or cash or any other property, or
(iii) the Company shall sell or otherwise transfer (or one or
more of its Subsidiaries shall sell or otherwise transfer), in
one or more transactions, assets or earning power aggregating 50%
or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to any other Person (other than
the Company or one or more wholly owned Subsidiaries of the
Company), then upon the first occurrence of such event, proper
provision shall be made so that: (A) each holder of a Right
(other than Rights which have become void pursuant to Section
11(a)(ii) hereof) shall thereafter have the right to receive,
upon the exercise thereof at the Purchase Price (as theretofore
adjusted in accordance with Section 11(a)(ii) hereof), in
accordance with the terms of this Agreement and in lieu of shares
of Preferred Stock or Common Stock of the Company, such number of
validly authorized and issued, fully paid, non-assessable and
freely tradeable shares of Common Stock of the Principal Party
(as such term is hereinafter defined), not subject to any liens,
encumbrances, rights of first refusal or other adverse claims, as
shall equal the result obtained by dividing the Purchase Price
(as theretofore adjusted in accordance with Section 11(a)(ii)
hereof) by 50% of the current per share market price of the
Common Stock of such Principal Party (determined pursuant to
Section 11(d) hereof) on the date of consummation of such
consolidation, merger, sale or transfer; provided, however, that
the Purchase Price (as theretofore adjusted in accordance with
Section 11(a)(ii) hereof) and the number of shares of Common
Stock of such Principal Party so receivable upon exercise of a
Right shall be subject to further adjustment as appropriate in
accordance with Section 11(f) hereof to reflect any events
occurring in respect of the Common Stock of such Principal Party
after the occurrence of such consolidation, merger, sale or
transfer; (B) such Principal Party shall thereafter be liable
for, and shall assume, by virtue of such consolidation, merger,
sale or transfer, all the obligations and duties of the Company
pursuant to this Rights Agreement; (C) the term "Company" shall
thereafter be deemed to refer to such Principal Party; and (D)
such Principal Party shall take such steps (including, but not
limited to, the reservation of a sufficient number of its shares
of Common Stock in accordance with Section 9 hereof) in
connection with such consummation of any such transaction as may
be necessary to assure that the provisions hereof shall
thereafter be applicable, as nearly as reasonably may be, in
relation to the shares of its Common Stock thereafter deliverable
upon the exercise of the Rights; provided that, upon the
subsequent occurrence of any consolidation, merger, sale or
transfer of assets or other extraordinary transaction in respect
of such Principal Party, each holder of a Right shall thereupon
be entitled to receive, upon exercise of a Right and payment of
the Purchase Price as provided in this Section 13(a), such cash,
shares, rights, warrants and other property which such holder
would have been entitled to receive had such holder, at the time
of such transaction, owned the Common Stock of the Principal
Party receivable upon the exercise of a Right pursuant to this
Section 13(a), and such Principal Party shall take such steps
(including, but not limited to, reservation of shares of stock)
as may be necessary to permit the subsequent exercise of the
Rights in accordance with the terms hereof for such cash, shares,
rights, warrants and other property.
(b) "Principal Party" shall mean:
(i) in the case of any transaction described in
(i) or (ii) of the first sentence of Section 13(a) hereof: (A)
the Person that is the issuer of the securities into which the
shares of Common Stock are converted in such merger or
consolidation, or, if there is more than one such issuer, the
issuer the shares of Common Stock of which have the greatest
aggregate market value of shares outstanding, or (B) if no
securities are so issued, (x) the Person that is the other party
to the merger, if such Person survives said merger, or, if there
is more than one such Person, the Person the shares of Common
Stock of which have the greatest aggregate market value of shares
outstanding or (y) if the Person that is the other party to the
merger does not survive the merger, the Person that does survive
the merger (including the Company if it survives) or (z) the
Person resulting from the consolidation; and
(ii) in the case of any transaction described in
(iii) of the first sentence in Section 13(a) hereof, the Person
that is the party receiving the greatest portion of the assets or
earning power transferred pursuant to such transaction or
transactions, or, if each Person that is a party to such
transaction or transactions receives the same portion of the
assets or earning power 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
Stock having the greatest aggregate market value of shares
outstanding;
provided, however, that in any such case described in the
foregoing clause (b)(i) or (b)(ii), if the Common Stock of such
Person is not at such time or has not been continuously over the
preceding 12-month period registered under Section 12 of the
Exchange Act, then (1) if such Person is a direct or indirect
Subsidiary of another Person the Common Stock of which is and has
been so registered, the term "Principal Party" shall refer to
such other Person, or (2) if such Person is a Subsidiary,
directly or indirectly, of more than one Person, the Common Stock
of all of which is and has been so registered, the term
"Principal Party" shall refer to whichever of such Persons is the
issuer of Common Stock having the greatest aggregate market value
of shares outstanding, or (3) if such Person is owned, directly
or indirectly, by a joint venture formed by two or more Persons
that are not owned, directly or indirectly, by the same Person,
the rules set forth in clauses (1) and (2) above shall apply to
each of the owners having an interest in the venture as if the
Person owned by the joint venture was a Subsidiary of both or all
of such joint venturers, and the Principal Party in each such
case shall bear the obligations set forth in this Section 13 in
the same ratio as its interest in such Person bears to the total
of such interests.
(c) The Company shall not consummate any
consolidation, merger, sale or transfer referred to in Section
13(a) hereof unless prior thereto the Company and the Principal
Party involved therein shall have executed and delivered to the
Rights Agent an agreement confirming that the requirements of
Sections 13(a) and (b) hereof shall promptly be performed in
accordance with their terms and that such consolidation, merger,
sale or transfer of assets shall not result in a default by the
Principal Party under this Agreement as the same shall have been
assumed by the Principal Party pursuant to Sections 13(a) and (b)
hereof and providing that, as soon as practicable after executing
such agreement pursuant to this Section 13, the Principal Party
will:
(i) prepare and file a registration statement
under the Securities Act, if necessary, with respect to the
Rights and the securities purchasable upon exercise of the Rights
on an appropriate form, use its best efforts to cause such
registration statement to become effective as soon as practicable
after such filing and use its best efforts to cause such
registration statement to remain effective (with a prospectus at
all times meeting the requirements of the Securities Act) until
the Expiration Date and similarly comply with applicable state
securities laws;
(ii) use its best efforts, if the Common Stock of
the Principal Party shall be listed or admitted to trading on the
New York Stock Exchange or on another national securities
exchange, to list or admit to trading (or continue the listing
of) the Rights and the securities purchasable upon exercise of
the Rights on the New York Stock Exchange or such securities
exchange, or, if the Common Stock of the Principal Party shall
not be listed or admitted to trading on the New York Stock
Exchange or a national securities exchange, to cause the Rights
and the securities receivable upon exercise of the Rights to be
authorized for quotation on NASDAQ or on such other system then
in use;
(iii) deliver to holders of the Rights
historical financial statements for the Principal Party which
comply in all respects with the requirements for registration on
Form 10 (or any successor form) under the Exchange Act; and
(iv) obtain waivers of any rights of first refusal
or preemptive rights in respect of the Common Stock of the
Principal Party subject to purchase upon exercise of outstanding
Rights.
(d) In case the Principal Party has provision in any
of its authorized securities or in its certificate of
incorporation or by-laws or other instrument governing its
corporate affairs, which provision would have the effect of (i)
causing such Principal Party to issue (other than to holders of
Rights pursuant to this Section 13), in connection with, or as a
consequence of, the consummation of a transaction referred to in
this Section 13, shares of Common Stock or Common Stock
Equivalents of such Principal Party at less than the then current
market price per share thereof (determined pursuant to Section
11(d) hereof) or securities exercisable for, or convertible into,
Common Stock or Common Stock Equivalents of such Principal Party
at less than such then current market price, or (ii) providing
for any special payment, tax or similar provision in connection
with the issuance of the Common Stock of such Principal Party
pursuant to the provisions of Section 13, then, in such event,
the Company hereby agrees with each holder of Rights that it
shall not consummate any such transaction unless prior thereto
the Company and such Principal Party shall have executed and
delivered to the Rights Agent a supplemental agreement providing
that the provision in question of such Principal Party shall have
been canceled, waived or amended, or that the authorized
securities shall be redeemed, so that the applicable provision
will have no effect in connection with, or as a consequence of,
the consummation of the proposed transaction.
(e) The Company covenants and agrees that it shall
not, at any time after the Flip-In Event, enter into any
transaction of the type described in clauses (i) through (iii) of
Section 13(a) hereof if (i) at the time of or immediately after
such consolidation, merger, sale, transfer or other transaction
there are any rights, warrants or other instruments or securities
outstanding or agreements in effect which would substantially
diminish or otherwise eliminate the benefits intended to be
afforded by the Rights, (ii) prior to, simultaneously with or
immediately after such consolidation, merger, sale, transfer or
other transaction, the stockholders of the Person who
constitutes, or would constitute, the Principal Party for
purposes of Section 13(b) hereof shall have received a
distribution of Rights previously owned by such Person or any of
its Affiliates or Associates or (iii) the form or nature of
organization of the Principal Party would preclude or limit the
exercisability of the Rights.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue
fractions of Rights or to distribute Right Certificates which
evidence fractional Rights (except prior to the Distribution Date
in accordance with Section 11(n) hereof). In lieu of such
fractional Rights, there shall be paid to the registered holders
of the Right Certificates with regard to which such fractional
Rights would otherwise be issuable, an amount in cash equal to
the same fraction of the current market value of a whole Right.
For the purposes of this Section 14(a), the current market value
of a whole Right shall be the closing price of the Rights for the
Trading Day immediately prior to the date on which such
fractional Rights would have been otherwise issuable. The
closing price for any day shall be the last sale price, regular
way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in
either case as reported in the principal consolidated transaction
reporting system with respect to securities listed or admitted to
trading on the New York Stock Exchange or, if the Rights are not
listed or admitted to trading on the New York Stock Exchange, as
reported in the principal consolidated transaction reporting
system with respect to securities listed on the principal
national securities exchange on which the Rights are listed or
admitted to trading or, if the Rights are not listed or admitted
to trading on any national securities exchange, the last quoted
price or, if not so quoted, the average of the high bid and low
asked prices in the over-the-counter market, as reported by
NASDAQ or such other system then in use or, if on any such date
the Rights are not quoted by any such organization, the average
of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights selected
by the Board of Directors of the Company. If on any such date no
such market maker is making a market in the Rights, the fair
value of the Rights on such date as determined in good faith by
the Board of Directors of the Company shall be used.
(b) The Company shall not be required to issue
fractions of Preferred Stock (other than fractions which are
integral multiples of one one-thousandths of a share of Preferred
Stock) or to distribute certificates which evidence fractional
shares of Preferred Stock (other than fractions which are
integral multiples of one one-thousandths of a share of Preferred
Stock) upon the exercise or exchange of Rights. Interests in
fractions of Preferred Stock in integral multiples of one one-
thousandths of a share of Preferred Stock may, at the election of
the Company, be evidenced by depositary receipts, pursuant to an
appropriate agreement between the Company and a depositary
selected by it; provided, that such agreement shall provide that
the holders of such depositary receipts shall have all the
rights, privileges and preferences to which they are entitled as
beneficial owners of the Preferred Stock represented by such
depositary receipts. In lieu of fractional shares of Preferred
Stock that are not integral multiples of one one-thousandths of a
share of Preferred Stock, the Company shall pay to the registered
holders of Right Certificates at the time such Rights are
exercised or exchanged as herein provided an amount in cash equal
to the same fraction of the current market value of a whole share
of Preferred Stock (as determined in accordance with Section
14(a) hereof) for the Trading Day immediately prior to the date
of such exercise or exchange.
(c) The Company shall not be required to issue
fractions of shares of Common Stock or to distribute certificates
which evidence fractional shares of Common Stock upon the
exercise or exchange of Rights. In lieu of such fractional
shares of Common Stock, the Company shall pay to the registered
holders of the Right Certificates with regard to which such
fractional shares of Common Stock would otherwise be issuable an
amount in cash equal to the same fraction of the current market
value of a whole share of Common Stock (as determined in
accordance with Section 14(a) hereof) for the Trading Day
immediately prior to the date of such exercise or exchange.
(d) The holder of a Right by the acceptance of the
Right expressly waives his right to receive any fractional Rights
or any fractional shares upon exercise or exchange of a Right
(except as provided above).
Section 15. Rights of Action. All rights of action in
respect of this Agreement, excepting the rights of action given
to the Rights Agent under Section 18 hereof, are vested in the
respective registered holders of the Right Certificates (and,
prior to the Distribution Date, the registered holders of the
Common Stock); and any registered holder of any Right Certificate
(or, prior to the Distribution Date, of the Common Stock),
without the consent of the Rights Agent or of the holder of any
other Right Certificate (or, prior to the Distribution Date, of
the Common Stock), on his own behalf and for his own benefit, may
enforce, and may institute and maintain any suit, action or
proceeding against the Company to enforce, or otherwise act in
respect of, his right to exercise the Rights evidenced by such
Right Certificate (or, prior to the Distribution Date, such
Common Stock) in the manner provided therein and in this
Agreement. Without limiting the foregoing or any remedies
available to the holders of Rights, it is specifically acknowl-
edged that the holders of Rights would not have an adequate
remedy at law for any breach of this Agreement and will be
entitled to specific performance of the obligations under, and
injunctive relief against actual or threatened violations of, the
obligations of any Person subject to this Agreement.
Section 16. Agreement of Right Holders. Every holder
of a Right, by accepting the same, consents and agrees with the
Company and the Rights Agent and with every other holder of a
Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of the Common
Stock;
(b) after the Distribution Date, the Right
Certificates are transferable only on the registry books of the
Rights Agent if surrendered at the office or agency of the Rights
Agent designated for such purpose, duly endorsed or accompanied
by a proper instrument of transfer; and
(c) the Company and the Rights Agent may deem and
treat the Person in whose name the Right Certificate (or, prior
to the Distribution Date, the Common Stock certificate) is
registered as the absolute owner thereof and of the Rights
evidenced thereby (notwithstanding any notations of ownership or
writing on the Right Certificates or the Common Stock certificate
made by anyone other than the Company or the Rights Agent) for
all purposes whatsoever, and neither the Company nor the Rights
Agent shall be affected by any notice to the contrary.
Section 17. Right Certificate Holder Not Deemed a
Stockholder. No holder, as such, of any Right Certificate shall
be entitled to vote, receive dividends or be deemed for any
purpose the holder of the Preferred Stock or any other securities
of the Company which may at any time be issuable on the exercise
or exchange of the Rights represented thereby, nor shall anything
contained herein or in any Right Certificate be construed to
confer upon the holder of any Right Certificate, as such, any of
the rights of a stockholder of the Company or any right to vote
for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold
consent to any corporate action, or to receive notice of meetings
or other actions affecting stockholders (except as provided in
this Agreement), or to receive dividends or subscription rights,
or otherwise, until the Rights evidenced by such Right
Certificate shall have been exercised or exchanged in accordance
with the provisions hereof.
Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent
reasonable compensation for all services rendered by it hereunder
and, from time to time, on demand of the Rights Agent, its
reasonable expenses and counsel fees and other disbursements
incurred in the administration and execution of this Agreement
and the exercise and performance of its duties hereunder. The
Company also agrees to indemnify the Rights Agent for, and to
hold it harmless against, any loss, liability or expense,
incurred without negligence, bad faith or willful misconduct on
the part of the Rights Agent, for anything done or omitted by the
Rights Agent in connection with the acceptance and administration
of this Agreement, including the costs and expenses of defending
against any claim of liability arising therefrom, directly or
indirectly. In no case will the Rights Agent be liable for
special, indirect, incidental or consequential loss or damages of
any kind whatsoever, even if the Rights Agent has been advised of
the possibility of such damages.
(b) The Rights Agent shall be protected and shall
incur no liability for, or in respect of any action taken,
suffered or omitted by it in connection with, its administration
of this Agreement in reliance upon any Right Certificate or
certificate for the Preferred Stock or Common Stock or for other
securities of the Company, instrument of assignment or transfer,
power of attorney, endorsement, affidavit, letter, notice,
direction, consent, certificate, statement or other paper or
document believed by it to be genuine and to be signed, executed
and, where necessary, verified or acknowledged, by the proper
Person or Persons, or otherwise upon the advice of counsel as set
forth in Section 20 hereof.
Section 19. Merger or Consolidation or Change of Name
of Rights Agent.
(a) Any corporation into which the Rights Agent or any
successor Rights Agent may be merged or with which it may be
consolidated, or any corporation resulting from any merger or
consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to the
stock transfer or corporate trust powers of the Rights Agent or
any successor Rights Agent, shall be the successor to the Rights
Agent under this Agreement without the execution or filing of any
paper or any further act on the part of any of the parties
hereto; provided, that such corporation would be eligible for
appointment as a successor Rights Agent under the provisions of
Section 21 hereof. In case at the time such successor Rights
Agent shall succeed to the agency created by this Agreement, any
of the Right Certificates shall have been countersigned but not
delivered, any such successor Rights Agent may adopt the
countersignature of the predecessor Rights Agent and deliver such
Right Certificates so countersigned; and in case at that time any
of the Right Certificates shall not have been countersigned, any
successor Rights Agent may countersign such Right Certificates
either in the name of the predecessor Rights Agent or in the name
of the successor Rights Agent; and in all such cases such Right
Certificates shall have the full force provided in the Right
Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent
shall be changed and at such time any of the Right Certificates
shall have been countersigned but not delivered, the Rights Agent
may adopt the countersignature under its prior name and deliver
Right Certificates so countersigned; and in case at that time any
of the Right Certificates shall not have been countersigned, the
Rights Agent may countersign such Right Certificates either in
its prior name or in its changed name and in all such cases such
Right Certificates shall have the full force provided in the
Right Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, by all of which the
Company and the holders of Right Certificates, by their
acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel
(who may be legal counsel for the Company), and the opinion of
such counsel shall be full and complete authorization and
protection to the Rights Agent as to any action taken or omitted
by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under
this Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter be proved or established by the
Company prior to taking or suffering any action hereunder, such
fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively
proved and established by a certificate signed by the Chief
Executive Officer and the Secretary of the Company and delivered
to the Rights Agent; and such certificate shall be full
authorization to the Rights Agent for any action taken or
suffered in good faith by it under the provisions of this
Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder to the
Company and any other Person only for its own negligence, bad
faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of any of the statements of fact or recitals contained in
this Agreement or in the Right Certificates (except its
countersignature thereof) or be required to verify the same, but
all such statements and recitals are and shall be deemed to have
been made by the Company only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement or
the execution and delivery hereof (except the due execution
hereof by the Rights Agent) or in respect of the validity or
execution of any Right Certificate (except its countersignature
thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement
or in any Right Certificate; nor shall it be responsible for any
change in the exercisability of the Rights (including the Rights
becoming void pursuant to Section 11(a)(ii) hereof) or any
adjustment in the terms of the Rights provided for in Sections 3,
11, 13, 23 and 24, or the ascertaining of the existence of facts
that would require any such change or adjustment (except with
respect to the exercise of Rights evidenced by Right Certificates
after receipt of a certificate furnished pursuant to Section 12,
describing such change or adjustment); nor shall it by any act
hereunder be deemed to make any representation or warranty as to
the authorization or reservation of any shares of Preferred Stock
or other securities to be issued pursuant to this Agreement or
any Right Certificate or as to whether any shares of Preferred
Stock or other securities will, when issued, be validly
authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute,
acknowledge and deliver or cause to be performed, executed,
acknowledged and delivered all such further and other acts,
instruments and assurances as may reasonably be required by the
Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed
to accept instructions with respect to the performance of its
duties hereunder from any person reasonably believed by the
Rights Agent to be one of the Chief Executive Officer or the
Secretary of the Company, and to apply to such officers for
advice or instructions in connection with its duties, and it
shall not be liable for any action taken or suffered by it in
good faith in accordance with instructions of any such officer or
for any delay in acting while waiting for those instructions.
Any application by the Rights Agent for written instructions from
the Company may, at the option of the Rights Agent, set forth in
writing any action proposed to be taken or omitted by the Rights
Agent under this Agreement and the date on and/or after which
such action shall be taken or such omission shall be effective.
The Rights Agent shall not be liable for any action taken by, or
omission of, the Rights Agent in accordance with a proposal
included in any such application on or after the date specified
in such application (which date shall not be less than five
Business Days after the date any officer of the Company actually
receives such application unless any such officer shall have
consented in writing to an earlier date) unless, prior to taking
any such action (or the effective date in the case of an
omission), the Rights Agent shall have received written
instructions in response to such application specifying the
action to be taken or omitted.
(h) The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal in
any of the Rights or other securities of the Company or become
pecuniarily interested in any transaction in which the Company
may be interested, or contract with or lend money to the Company
or otherwise act as fully and freely as though it were not Rights
Agent under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or
for any other legal entity.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents,
and the Rights Agent shall not be answerable or accountable for
any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct, provided reasonable care was
exercised in the selection and continued employment thereof.
(j) If, with respect to any Rights Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate contained in the form of assignment or the form of
election to purchase set forth on the reverse thereof, as the
case may be, has not been completed to certify the holder is not
an Acquiring Person (or an Affiliate or Associate thereof), the
Rights Agent shall not take any further action with respect to
such requested exercise or transfer without first consulting with
the Company.
Section 21. Change of Rights Agent. The Rights Agent
or any successor Rights Agent may resign and be discharged from
its duties under this Agreement upon 30 days' notice in writing
mailed to the Company and to each transfer agent of the Common
Stock or Preferred Stock by registered or certified mail, and,
following the Distribution Date, to the holders of the Right
Certificates by first-class mail. The Company may remove the
Rights Agent or any successor Rights Agent upon 30 days' notice
in writing, mailed to the Rights Agent or successor Rights Agent,
as the case may be, and to each transfer agent of the Common
Stock or Preferred Stock by registered or certified mail, and,
following the Distribution Date, to the holders of the Right
Certificates by first-class mail. If the Rights Agent shall
resign or be removed or shall otherwise become incapable of
acting, the Company shall appoint a successor to the Rights
Agent. If the Company shall fail to make such appointment within
a period of 30 days after giving notice of such removal or after
it has been notified in writing of such resignation or incapacity
by the resigning or incapacitated Rights Agent or by the holder
of a Right Certificate (who shall, with such notice, submit his
Right Certificate for inspection by the Company), then the
registered holder of any Right Certificate may apply to any court
of competent jurisdiction for the appointment of a new Rights
Agent. Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be a corporation, or an
affiliate of such corporation, organized and doing business under
the laws of the United States or the laws of any state of the
United States or the District of Columbia, in good standing,
having an office in the State of New York, which is authorized
under such laws to exercise corporate trust or stock transfer
powers and is subject to supervision or examination by federal or
state authority and which has at the time of its appointment as
Rights Agent a combined capital and surplus of at least $50
million. After appointment, the successor Rights Agent shall be
vested with the same powers, rights, duties and responsibilities
as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall
deliver and transfer to the successor Rights Agent any property
at the time held by it hereunder, and execute and deliver any
further assurance, conveyance, act or deed necessary for the
purpose. Not later than the effective date of any such
appointment the Company shall file notice thereof in writing with
the predecessor Rights Agent and each transfer agent of the
Common Stock or Preferred Stock, and, following the Distribution
Date, mail a notice thereof in writing to the registered holders
of the Right Certificates. Failure to give any notice provided
for in this Section 21, however, or any defect therein, shall not
affect the legality or validity of the resignation or removal of
the Rights Agent or the appointment of the successor Rights
Agent, as the case may be.
Section 22. Issuance of New Right Certificates.
Notwithstanding any of the provisions of this Agreement or of the
Rights to the contrary, the Company may, at its option, issue new
Right Certificates evidencing Rights in such forms as may be
approved by its Board of Directors to reflect any adjustment or
change in the Purchase Price and the number or kind or class of
shares or other securities or property purchasable under the
Right Certificates made in accordance with the provisions of this
Agreement. In addition, in connection with the issuance or sale
of Common Stock following the Distribution Date and prior to the
Expiration Date, the Company may with respect to shares of Common
Stock so issued or sold pursuant to (i) the exercise of stock
options, (ii) under any employee plan or arrangement, (iii) upon
the exercise, conversion or exchange of securities, notes or
debentures issued by the Company or (iv) a contractual obligation
of the Company, in each case existing prior to the Distribution
Date, issue Rights Certificates representing the appropriate
number of Rights in connection with such issuance or sale.
Section 23. Redemption.
(a) The Board of Directors of the Company may, at any
time prior to the Flip-In Event, redeem all but not less than all
the then outstanding Rights at a redemption price of $.01 per
Right, appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof
(the redemption price being hereinafter referred to as the
"Redemption Price"). The redemption of the Rights may be made
effective at such time, on such basis and with such conditions as
the Board of Directors in its sole discretion may establish. The
Redemption Price shall be payable, at the option of the Company,
in cash, shares of Common Stock, or such other form of
consideration as the Board of Directors shall determine.
(b) Immediately upon the action of the Board of
Directors ordering the redemption of the Rights pursuant to
paragraph (a) of this Section 23 (or at such later time as the
Board of Directors may establish for the effectiveness of such
redemption), and without any further action and without any
notice, the right to exercise the Rights will terminate and the
only right thereafter of the holders of Rights shall be to
receive the Redemption Price. The Company shall promptly give
public notice of any such redemption; provided, however, that the
failure to give, or any defect in, any such notice shall not
affect the validity of such redemption. Within 10 days after
such action of the Board of Directors ordering the redemption of
the Rights (or such later time as the Board of Directors may
establish for the effectiveness of such redemption), the Company
shall mail a notice of redemption to all the holders of the then
outstanding Rights at their last addresses as they appear upon
the registry books of the Rights Agent or, prior to the
Distribution Date, on the registry books of the transfer agent
for the Common Stock. Any notice which is mailed in the manner
herein provided shall be deemed given, whether or not the holder
receives the notice. Each such notice of redemption shall state
the method by which the payment of the Redemption Price will be
made.
Section 24. Exchange.
(a) The Board of Directors of the Company may, at its
option, subject to the provisions of Article XVIII of the
Company's Certificate of Incorporation, at any time after the
Flip-In Event, exchange all or part of the then outstanding and
exercisable Rights (which shall not include Rights that have
become void pursuant to the provisions of Section 11(a)(ii)
hereof) for Common Stock at an exchange ratio of one share of
Common Stock per Right, appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring
after the date hereof (such amount per Right being hereinafter
referred to as the "Exchange Ratio"). Notwithstanding the
foregoing, the Board of Directors shall not be empowered to
effect such exchange at any time after an Acquiring Person shall
have become the Beneficial Owner of shares of Common Stock
aggregating 50% or more of the shares of Common Stock then
outstanding. From and after the occurrence of an event specified
in Section 13(a) hereof, any Rights that theretofore have not
been exchanged pursuant to this Section 24(a) shall thereafter be
exercisable only in accordance with Section 13 and may not be
exchanged pursuant to this Section 24(a). The exchange of the
Rights by the Board of Directors may be made effective at such
time, on such basis and with such conditions as the Board of
Directors in its sole discretion may establish.
(b) Immediately upon the effectiveness of the action
of the Board of Directors of the Company ordering the exchange of
any Rights pursuant to paragraph (a) of this Section 24 and
without any further action and without any notice, the right to
exercise such Rights shall terminate and the only right
thereafter of a holder of such Rights shall be to receive that
number of shares of Common Stock equal to the number of such
Rights held by such holder multiplied by the Exchange Ratio. The
Company shall promptly give public notice of any such exchange;
provided, however, that the failure to give, or any defect in,
such notice shall not affect the validity of such exchange. The
Company shall promptly mail a notice of any such exchange to all
of the holders of the Rights so exchanged at their last addresses
as they appear upon the registry books of the Rights Agent. Any
notice which is mailed in the manner herein provided shall be
deemed given, whether or not the holder receives the notice.
Each such notice of exchange will state the method by which the
exchange of the shares of Common Stock for Rights will be
effected and, in the event of any partial exchange, the number of
Rights which will be exchanged. Any partial exchange shall be
effected pro rata based on the number of Rights (other than
Rights which have become void pursuant to the provisions of
Section 11(a)(ii) hereof) held by each holder of Rights.
(c) The Company may at its option substitute, and, in
the event that there shall not be sufficient shares of Common
Stock issued but not outstanding or authorized but unissued to
permit an exchange of Rights for Common Stock as contemplated in
accordance with this Section 24, the Company shall substitute to
the extent of such insufficiency, for each share of Common Stock
that would otherwise be issuable upon exchange of a Right, a
number of shares of Preferred Stock or fraction thereof (or
equivalent preferred shares, as such term is defined in Section
11(b)) such that the current per share market price (determined
pursuant to Section 11(d) hereof) of one share of Preferred Stock
(or equivalent preferred share) multiplied by such number or
fraction is equal to the current per share market price of one
share of Common Stock (determined pursuant to Section 11(d)
hereof) as of the date of such exchange.
Section 25. Notice of Certain Events.
(a) In case the Company shall at any time after the
earlier of the Distribution Date or the Stock Acquisition Date
propose (i) to pay any dividend payable in stock of any class to
the holders of its Preferred Stock or to make any other
distribution to the holders of its Preferred Stock (other than a
regular quarterly cash dividend), (ii) to offer to the holders of
its Preferred Stock rights or warrants to subscribe for or to
purchase any additional shares of Preferred Stock or shares of
stock of any class or any other securities, rights or options,
(iii) to effect any reclassification of its Preferred Stock
(other than a reclassification involving only the subdivision or
combination of outstanding Preferred Stock), (iv) to effect the
liquidation, dissolution or winding up of the Company, or (v) to
pay any dividend on the Common Stock payable in Common Stock or
to effect a subdivision, combination or consolidation of the
Common Stock (by reclassification or otherwise than by payment of
dividends in Common Stock), then, in each such case, the Company
shall give to each holder of a Right Certificate, in accordance
with Section 26 hereof, a notice of such proposed action, which
shall specify the record date for the purposes of such stock
dividend, or distribution of rights or warrants, or the date on
which such liquidation, dissolution or winding up is to take
place and the date of participation therein by the holders of the
Common Stock and/or Preferred Stock, if any such date is to be
fixed, and such notice shall be so given in the case of any
action covered by clause (i) or (ii) above at least 10 days prior
to the record date for determining holders of the Preferred Stock
for purposes of such action, and in the case of any such other
action, at least 10 days prior to the date of the taking of such
proposed action or the date of participation therein by the
holders of the Common Stock and/or Preferred Stock, whichever
shall be the earlier.
(b) In case any event described in Section 11(a)(ii)
or Section 13 shall occur then the Company shall as soon as
practicable thereafter give to each holder of a Right Certificate
(or if occurring prior to the Distribution Date, the holders of
the Common Stock) in accordance with Section 26 hereof, a notice
of the occurrence of such event, which notice shall describe such
event and the consequences of such event to holders of Rights
under Section 11(a)(ii) and Section 13 hereof.
Section 26. Notices. Notices or demands authorized by
this Agreement to be given or made by the Rights Agent or by the
holder of any Right Certificate to or on the Company shall be
sufficiently given or made if sent by first-class mail, postage
prepaid, addressed (until another address is filed in writing
with the Rights Agent) as follows:
ConAgra, Inc.
One ConAgra Drive
Omaha, Nebraska 68102
Attention: Secretary
Subject to the provisions of Section 21 hereof, any notice or
demand authorized by this Agreement to be given or made by the
Company or by the holder of any Right Certificate to or on the
Rights Agent shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed (until another
address is filed in writing with the Company) as follows:
ChaseMellon Shareholder Services, L.L.C.
450 West 33rd Street
New York, New York 10001
Attn: V.P. Administration
Notices or demands authorized by this Agreement to be given or
made by the Company or the Rights Agent to the holder of any
Right Certificate shall be sufficiently given or made if sent by
first-class mail, postage prepaid, addressed to such holder at
the address of such holder as shown on the registry books of the
Company.
Section 27. Supplements and Amendments. Except as
provided in the penultimate sentence of this Section 27, for so
long as the Rights are then redeemable, the Company may in its
sole and absolute discretion, and the Rights Agent shall if the
Company so directs, supplement or amend any provision of this
Agreement in any respect without the approval of any holders of
the Rights. At any time when the Rights are no longer
redeemable, except as provided in the penultimate sentence of
this Section 27, the Company may, and the Rights Agent shall, if
the Company so directs, supplement or amend this Agreement
without the approval of any holders of Rights in order to (i)
cure any ambiguity, (ii) correct or supplement any provision
contained herein which may be defective or inconsistent with any
other provision herein, (iii) shorten or lengthen any time period
hereunder, or (iv) change or supplement the provisions hereunder
in any manner which the Company may deem necessary or desirable;
provided that no such supplement or amendment shall adversely
affect the interests of the holders of Rights as such (other than
an Acquiring Person or an Affiliate or Associate of an Acquiring
Person), and no such amendment may cause the Rights again to
become redeemable or cause the Agreement again to become
amendable other than in accordance with this sentence.
Notwithstanding anything contained in this Agreement to the
contrary, no supplement or amendment shall be made which changes
the Redemption Price. Upon the delivery of a certificate from an
appropriate officer of the Company which states that the proposed
supplement or amendment is in compliance with the terms of this
Section 27, the Rights Agent shall execute such supplement or
amendment.
Section 28. Successors. All the covenants and
provisions of this Agreement by or for the benefit of the Company
or the Rights Agent shall bind and inure to the benefit of their
respective successors and assigns hereunder.
Section 29. Benefits of this Agreement. Nothing in
this Agreement shall be construed to give to any Person other
than the Company, the Rights Agent and the registered holders of
the Right Certificates (and, prior to the Distribution Date, the
Common Stock) any legal or equitable right, remedy or claim under
this Agreement; but this Agreement shall be for the sole and
exclusive benefit of the Company, the Rights Agent and the
registered holders of the Right Certificates (and, prior to the
Distribution Date, the Common Stock).
Section 30. Determinations and Actions by the Board of
Directors. The Board of Directors of the Company shall have the
exclusive power and authority to administer this Agreement and to
exercise the rights and powers specifically granted to the Board
of Directors of the Company or to the Company, or as may be
necessary or advisable in the administration of this Agreement,
including, without limitation, the right and power to (i)
interpret the provisions of this Agreement and (ii) make all
determinations deemed necessary or advisable for the
administration of this Agreement (including, without limitation,
a determination to redeem or not redeem the Rights or to amend
this Agreement). All such actions, calculations, interpretations
and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing) that are done or
made by the Board of Directors of the Company in good faith,
shall (x) be final, conclusive and binding on the Company, the
Rights Agent, the holders of the Rights, as such, and all other
parties, and (y) not subject the Board of Directors to any
liability to the holders of the Rights.
Section 31. Severability. If any term, provision,
covenant or restriction of this Agreement is held by a court of
competent jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants
and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
Section 32. Governing Law. This Agreement and each
Right Certificate issued hereunder shall be deemed to be a
contract made under the laws of the State of Delaware and for all
purposes shall be governed by and construed in accordance with
the laws of such State applicable to contracts to be made and
performed entirely within such State.
Section 33. Counterparts. This Agreement may be
executed in any number of counterparts and each of such
counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and
the same instrument.
Section 34. Descriptive Headings. Descriptive
headings of the several Sections of this Agreement are inserted
for convenience only and shall not control or affect the meaning
or construction of any of the provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, all as of the day and year first
above written.
CONAGRA, INC.
By: /s/ James P. O'Donnell
Name: James P. O'Donnell
Title: Senior Vice President
and Chief Financial Officer
CHASEMELLON SHAREHOLDER
SERVICES, L.L.C., as Rights Agent
By: /s/ Stanley E. Siekierski
Name: Stanley E. Siekierski
Title: Vice President
Exhibit A
FORM OF
CERTIFICATE OF DESIGNATION
of
SERIES A JUNIOR PARTICIPATING CLASS E PREFERRED STOCK
of
CONAGRA, INC.
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
ConAgra, Inc., a corporation organized and existing
under the General Corporation Law of the State of Delaware, in
accordance with the provisions of Section 103 thereof, DOES
HEREBY CERTIFY:
That pursuant to the authority vested in the Board of
Directors in accordance with the provisions of the Certificate of
Incorporation of the said Corporation, the said Board of
Directors on July 12, 1996 adopted the following resolution
creating a series of 1,000,000 shares of Class E Preferred Stock
designated as "Series A Junior Participating Class E Preferred
Stock":
RESOLVED, that pursuant to the authority
vested in the Board of Directors of this
Corporation in accordance with the provisions
of the Certificate of Incorporation, a series
of Class E Preferred Stock, without par
value, of the Corporation be and hereby is
created, and that the designation and number
of shares thereof and the voting and other
powers, preferences and relative,
participating, optional or other rights of
the shares of such series and the
qualifications, limitations and restrictions
thereof are as follows:
Series A Junior Participating Class E Preferred Stock
1. Designation and Amount. There shall be a series
of Class E Preferred Stock that shall be designated as "Series A
Junior Participating Class E Preferred Stock," and the number of
shares constituting such series shall be 1,000,000. Such number
of shares may be increased or decreased by resolution of the
Board of Directors; provided, however, that no decrease shall
reduce the number of shares of Series A Junior Participating
Class E Preferred Stock to less than the number of shares then
issued and outstanding plus the number of shares issuable upon
exercise of outstanding rights, options or warrants or upon
conversion of outstanding securities issued by the Corporation.
2. Dividends and Distribution.
(A) Subject to the prior and superior rights of
the holders of any shares of any series of preferred stock
ranking prior and superior to the shares of Series A Junior
Participating Class E Preferred Stock with respect to dividends,
the holders of shares of Series A Junior Participating Class E
Preferred Stock, in preference to the holders of shares of any
class or series of stock of the Corporation ranking junior to the
Series A Junior Participating Class E Preferred Stock in respect
thereof, shall be entitled to receive, when, as and if declared
by the Board of Directors out of funds legally available for the
purpose, quarterly dividends payable in cash on the first day of
March, June, September and December in each year (each such date
being referred to herein as a "Quarterly Dividend Payment Date"),
commencing on the first Quarterly Dividend Payment Date after the
first issuance of a share or fraction of a share of Series A
Junior Participating Class E Preferred Stock, in an amount per
share (rounded to the nearest cent) equal to the greater of (a)
$1.00 or (b) the Adjustment Number (as defined below) times the
aggregate per share amount of all cash dividends, and the
Adjustment Number times the aggregate per share amount (payable
in kind) of all non-cash dividends or other distributions other
than a dividend payable in shares of Common Stock or a
subdivision of the outstanding shares of Common Stock (by
reclassification or otherwise), declared on the Common Stock, par
value $5.00 per share, of the Corporation (the "Common Stock")
since the immediately preceding Quarterly Dividend Payment Date,
or, with respect to the first Quarterly Dividend Payment Date,
since the first issuance of any share or fraction of a share of
Series A Junior Participating Class E Preferred Stock. The
"Adjustment Number" shall initially be 1000. In the event the
Corporation shall at any time after July 12, 1996 (the "Rights
Declaration Date") (i) declare and pay any dividend on Common
Stock payable in shares of Common Stock, (ii) subdivide the
outstanding Common Stock or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such case the
Adjustment Number in effect immediately prior to such event shall
be adjusted by multiplying such Adjustment Number by a fraction
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.
(B) The Corporation shall declare a dividend or
distribution on the Series A Junior Participating Class E
Preferred Stock as provided in paragraph (A) above immediately
after it declares a dividend or distribution on the Common Stock
(other than a dividend payable in shares of Common Stock).
(C) Dividends shall begin to accrue and be
cumulative on outstanding shares of Series A Junior Participating
Class E Preferred Stock from the Quarterly Dividend Payment Date
next preceding the date of issue of such shares of Series A
Junior Participating Class E Preferred Stock, unless the date of
issue of such shares is prior to the record date for the first
Quarterly Dividend Payment Date, in which case dividends on such
shares shall begin to accrue from the date of issue of such
shares, or unless the date of issue is a Quarterly Dividend
Payment Date or is a date after the record date for the
determination of holders of shares of Series A Junior
Participating Class E Preferred Stock entitled to receive a
quarterly dividend and before such Quarterly Dividend Payment
Date, in either of which events such dividends shall begin to
accrue and be cumulative from such Quarterly Dividend Payment
Date. Accrued but unpaid dividends shall not bear interest.
Dividends paid on the shares of Series A Junior Participating
Class E Preferred Stock in an amount less than the total amount
of such dividends at the time accrued and payable on such shares
shall be allocated pro rata on a share-by-share basis among all
such shares at the time outstanding. The Board of Directors may
fix a record date for the determination of holders of shares of
Series A Junior Participating Class E 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.
3. Voting Rights. The holders of shares of Series A
Junior Participating Class E Preferred Stock shall have the
following voting rights:
(A) Each share of Series A Junior Participating
Class E Preferred Stock shall entitle the holder thereof to a
number of votes equal to the Adjustment Number on all matters
submitted to a vote of the stockholders of the Corporation.
(B) Except as required by law and by Section 10
hereof, holders of Series A Junior Participating Class E
Preferred Stock shall have no special voting rights and their
consent shall not be required (except to the extent they are
entitled to vote with holders of Common Stock as set forth
herein) for taking any corporate action.
4. Certain Restrictions.
(A) Whenever quarterly dividends or other
dividends or distributions payable on the Series A Junior
Participating Class E Preferred Stock as provided in Section 2
are in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared, on shares
of Series A Junior Participating Class E Preferred Stock
outstanding shall have been paid in full, the Corporation shall
not
(i) declare or pay dividends on, make any
other distributions on, or redeem or purchase or otherwise
acquire for consideration any shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or
winding up) to the Series A Junior Participating Class E
Preferred Stock,
(ii) declare or pay dividends on or make any
other
distributions on any shares of stock ranking on a parity (either
as to dividends or upon liquidation, dissolution or winding up)
with the Series A Junior Participating Class E Preferred Stock,
except dividends paid ratably on the Series A Junior
Participating Class E Preferred Stock and all such parity stock
on which dividends are payable or in arrears in proportion to the
total amounts to which the holders of all such shares are then
entitled; or
(iii) purchase or otherwise acquire for
consideration any shares of Series A Junior Participating Class E
Preferred Stock, or any shares of stock ranking on a parity with
the Series A Junior Participating Class E Preferred Stock, except
in accordance with a purchase offer made in writing or by
publication (as determined by the Board of Directors) to all
holders of Series A Junior Participating Class E Preferred Stock,
or to such holders and holders of any such shares ranking on a
parity therewith, upon such terms as the Board of Directors,
after consideration of the respective annual dividend rates and
other relative rights and preferences of the respective series
and classes, shall determine in good faith will result in fair
and equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any
subsidiary of the Corporation to purchase or otherwise acquire
for consideration any shares of stock of the Corporation unless
the Corporation could, under paragraph (A) of this Section 4,
purchase or otherwise acquire such shares at such time and in
such manner.
5. Reacquired Shares. Any shares of Series A Junior
Participating Class E Preferred Stock purchased or otherwise
acquired by the Corporation in any manner whatsoever shall be
retired promptly after the acquisition thereof. All such shares
shall upon their retirement become authorized but unissued shares
of Class E Preferred Stock and may be reissued as part of a new
series of Class E Preferred Stock to be created by resolution or
resolutions of the Board of Directors, subject to any conditions
and restrictions on issuance set forth herein.
6. Liquidation, Dissolution or Winding Up. (A) Upon
any liquidation, dissolution or winding up of the Corporation,
voluntary or otherwise, no distribution shall be made to the
holders of shares of stock ranking junior (either as to dividends
or upon liquidation, dissolution or winding up) to the Series A
Junior Participating Class E Preferred Stock unless, prior
thereto, the holders of shares of Series A Junior Participating
Class E Preferred Stock shall have received an amount per share
(the "Series A Liquidation Preference") equal to the greater of
(i) $100 plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of
such payment, or (ii) the Adjustment Number times the per share
amount of all cash and other property to be distributed in
respect of the Common Stock upon such liquidation, dissolution or
winding up of the Corporation.
(B) In the event, however, that there are not
sufficient assets available to permit payment in full of the
Series A Liquidation Preference and the liquidation preferences
of all other series of all classes of preferred stock, if any,
that rank on a parity with the Series A Junior Participating
Class E Preferred Stock in respect thereof, then the assets
available for such distribution shall be distributed ratably to
the holders of the Series A Junior Participating Class E
Preferred Stock and the holders of such parity shares in
proportion to their respective liquidation preferences.
(C) Neither the merger or consolidation of the
Corporation into or with another corporation nor the merger or
consolidation of any other corporation into or with the
Corporation shall be deemed to be a liquidation, dissolution or
winding up of the Corporation within the meaning of this Section
6.
7. Consolidation, Merger, Etc. In case the
Corporation shall enter into any consolidation, merger,
combination or other transaction in which the outstanding shares
of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case
each share of Series A Junior Participating Class E Preferred
Stock shall at the same time be similarly exchanged or changed in
an amount per share equal to the Adjustment Number 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.
8. No Redemption. Shares of Series A Junior
Participating Class E Preferred Stock shall not be subject to
redemption by the Company.
9. Ranking. The Series A Junior Participating Class
E Preferred Stock shall rank junior to all other series of all
classes of the Corporation's preferred stock as to the payment of
dividends and as to the distribution of assets upon liquidation,
dissolution or winding up, unless the terms of any such series
shall provide otherwise, and shall rank senior to the Common
Stock as to such matters.
10. Amendment. At any time that any shares of Series
A Junior Participating Class E Preferred Stock are outstanding,
the Certificate of Incorporation of the Corporation shall not be
amended in any manner which would materially alter or change the
powers, preferences or special rights of the Series A Junior
Participating Class E Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of two-
thirds of the outstanding shares of Series A Junior Participating
Class E Preferred Stock, voting separately as a class.
11. Fractional Shares. Series A Junior Participating
Class E 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 Junior Participating Class E
Preferred Stock.
IN WITNESS WHEREOF, the undersigned has executed this
Certificate this 12th day of July, 1996.
CONAGRA, INC.
By:
Name:
Title:
Exhibit B
Form of Right Certificate
Certificate No. R-______
NOT EXERCISABLE AFTER JULY 12, 2006 OR
EARLIER IF REDEMPTION OR EXCHANGE OCCURS.
THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.01
PER RIGHT AND TO EXCHANGE ON THE TERMS SET
FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS
AGREEMENT, RIGHTS OWNED BY OR TRANSFERRED TO
ANY PERSON WHO IS OR BECOMES AN ACQUIRING
PERSON (AS DEFINED IN THE RIGHTS AGREEMENT)
AND CERTAIN TRANSFEREES THEREOF WILL BECOME
NULL AND VOID AND WILL NO LONGER BE
TRANSFERABLE.
Right Certificate
CONAGRA, INC.
This certifies that ____________________________ or
registered assigns, is the registered owner of the number of
Rights set forth above, each of which entitles the owner thereof,
subject to the terms, provisions and conditions of the Rights
Agreement, dated as of July 12, 1996, as the same may be amended
from time to time (the "Rights Agreement"), between ConAgra,
Inc., a Delaware corporation (the "Company"), and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent (the "Rights
Agent"), to purchase from the Company at any time after the
Distribution Date (as such term is defined in the Rights
Agreement) and prior to 5:00 P.M., Omaha, Nebraska time, on July
12, 2006 at the office or agency of the Rights Agent designated
for such purpose, or of its successor as Rights Agent, one one-
thousandth of a fully paid non-assessable share of Series A
Junior Participating Class E Preferred Stock, without par value
(the "Preferred Stock"), of the Company, at a purchase price of
$200.00 per one one-thousandth of a share of Preferred Stock (the
"Purchase Price"), upon presentation and surrender of this Right
Certificate with the Form of Election to Purchase duly executed.
The number of Rights evidenced by this Rights Certificate (and
the number of one one-thousandths of a share of Preferred Stock
which may be purchased upon exercise hereof) set forth above, and
the Purchase Price set forth above, are the number and Purchase
Price as of July 12, 1996, based on the Preferred Stock as
constituted at such date. As provided in the Rights Agreement,
the Purchase Price, the number of one one-thousandths of a share
of Preferred Stock (or other securities or property) which may be
purchased upon the exercise of the Rights and the number of
Rights evidenced by this Right Certificate are subject to
modification and adjustment upon the happening of certain events.
This Right Certificate is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities
hereunder of the Rights Agent, the Company and the holders of the
Right Certificates. Copies of the Rights Agreement are on file
at the principal executive offices of the Company and the above-
mentioned office or agency of the Rights Agent. The Company will
mail to the holder of this Right Certificate a copy of the Rights
Agreement without charge after receipt of a written request
therefor.
This Right Certificate, with or without other Right
Certificates, upon surrender at the office or agency of the
Rights Agent designated for such purpose, may be exchanged for
another Right Certificate or Right Certificates of like tenor and
date evidencing Rights entitling the holder to purchase a like
aggregate number of shares of Preferred Stock as the Rights
evidenced by the Right Certificate or Right Certificates
surrendered shall have entitled such holder to purchase. If this
Right Certificate shall be exercised in part, the holder shall be
entitled to receive upon surrender hereof another Right
Certificate or Right Certificates for the number of whole Rights
not exercised.
Subject to the provisions of the Rights Agreement, the
Rights evidenced by this Certificate (i) may be redeemed by the
Company at a redemption price of $.01 per Right or (ii) may be
exchanged in whole or in part for shares of the Company's Common
Stock, par value $5.00 per share, or shares of Preferred Stock.
No fractional shares of Preferred Stock or Common Stock
will be issued upon the exercise or exchange of any Right or
Rights evidenced hereby (other than fractions of Preferred Stock
which are integral multiples of one one-thousandths of a share of
Preferred Stock, which may, at the election of the Company, be
evidenced by depository receipts), but in lieu thereof a cash
payment will be made, as provided in the Rights Agreement.
No holder of this Right Certificate, as such, shall be
entitled to vote or receive dividends or be deemed for any
purpose the holder of the Preferred Stock or of any other
securities of the Company which may at any time be issuable on
the exercise or exchange hereof, nor shall anything contained in
the Rights Agreement or herein be construed to confer upon the
holder hereof, as such, any of the rights of a stockholder of the
Company or any right to vote for the election of directors or
upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting
stockholders (except as provided in the Rights Agreement) or to
receive dividends or subscription rights, or otherwise, until the
Right or Rights evidenced by this Right Certificate shall have
been exercised or exchanged as provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory
for any purpose until it shall have been countersigned by the
Rights Agent.
WITNESS the facsimile signature of the proper officers
of the Company and its corporate seal. Dated as of
_____________________________ ___, 199_.
CONAGRA, INC.
ATTEST:
By:__________________________________
[Title]
____________________________________
[Title]
Countersigned:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C., as Rights Agent
By__________________________________
[Title]
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate)
FOR VALUE RECEIVED __________________________ hereby
sells, assigns and transfers unto
________________________________________________________
_________________________________________________________________
__________
(Please print name and address of transferee)
_________________________________________________________________
__________
Rights represented by this Right Certificate, together with all
right, title and interest therein, and does hereby irrevocably
constitute and appoint ______________________________ Attorney,
to transfer said Rights on the books of the within-named Company,
with full power of substitution.
Dated: ____________________________
____________________________________
Signature
Signature Guaranteed:
Signatures must be guaranteed by a bank, trust company,
broker, dealer or other eligible institution participating in a
recognized signature guarantee medallion program.
.................................................................
...............
(To be completed)
The undersigned hereby certifies that the Rights
evidenced by this Right Certificate are not beneficially owned
by, were not acquired by the undersigned from, and are not being
assigned to an Acquiring Person or an Affiliate or Associate
thereof (as defined in the Rights Agreement).
____________________________________
Signature
Form of Reverse Side of Right Certificate - continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise
Rights represented by the Rights Certificate)
To CONAGRA, INC.:
The undersigned hereby irrevocably elects to exercise
________ Rights represented by this Right Certificate to purchase
the shares of Preferred Stock (or other securities or property)
issuable upon the exercise of such Rights and requests that
certificates for such shares of Preferred Stock (or such other
securities) be issued in the name of:
_________________________________________________________________
__________
(Please print name and address)
_________________________________________________________________
__________
If such number of Rights shall not be all the Rights evidenced by
this Right Certificate, a new Right Certificate for the balance
remaining of such Rights shall be registered in the name of and
delivered to:
Please insert social security
or other identifying number
_________________________________________________________________
__________
(Please print name and address)
_________________________________________________________________
__________
Dated:________________________
____________________________________
Signature
(Signature must conform to holder specified on Right Certificate)
Signature Guaranteed:
Signature must be guaranteed by a bank, trust company,
broker, dealer or other eligible institution participating in a
recognized signature guarantee medallion program.
Form of Reverse Side of Right Certificate - continued
_________________________________________________________________
_____________
(To be completed)
The undersigned certifies that the Rights evidenced by
this Right Certificate are not beneficially owned by, and were
not acquired by the undersigned from, an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights
Agreement).
____________________________________
Signature
_________________________________________________________________
_____________
NOTICE
The signature in the Form of Assignment or Form of
Election to Purchase, as the case may be, must conform to the
name as written upon the face of this Right Certificate in every
particular, without alteration or enlargement or any change
whatsoever.
In the event the certification set forth above in the
Form of Assignment or the Form of Election to Purchase, as the
case may be, is not completed, such Assignment or Election to
Purchase will not be honored.
Exhibit C
UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN
THE RIGHTS AGREEMENT, RIGHTS OWNED BY OR
TRANSFERRED TO ANY PERSON WHO IS OR BECOMES
AN ACQUIRING PERSON (AS DEFINED IN THE RIGHTS
AGREEMENT) AND CERTAIN TRANSFEREES THEREOF
WILL BECOME NULL AND VOID AND WILL NO LONGER
BE TRANSFERABLE.
SUMMARY OF RIGHTS TO PURCHASE
SHARES OF PREFERRED STOCK OF
CONAGRA, INC.
On July 12, 1996, the Board of Directors of ConAgra,
Inc. (the "Company") declared a dividend of one preferred share
purchase right (a "Right") for each outstanding share of common
stock, par value $5.00 per share, of the Company (the "Common
Stock"). The dividend is payable on July 24, 1996 (the "Record
Date") to the stockholders of record on that date. Each Right
entitles the registered holder to purchase from the Company one
one-thousandth of a share of Series A Junior Participating Class
E Preferred Stock, without par value, of the Company (the
"Preferred Stock") at a price of $200.00 per one one-thousandth
of a share of Preferred Stock (the "Purchase Price"), subject to
adjustment. The description and terms of the Rights are set
forth in a Rights Agreement dated as of July 12, 1996, as the
same may be amended from time to time (the "Rights Agreement"),
between the Company and ChaseMellon Shareholder Services, L.L.C.,
as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) 10 days following a
public announcement that a person or group of affiliated or
associated persons (an "Acquiring Person") has acquired
beneficial ownership of 15% or more of the outstanding shares of
Common Stock or (ii) 10 business days (or such later date as may
be determined by action of the Board of Directors prior to such
time as any person or group of affiliated persons becomes an
Acquiring Person) following the commencement of, or announcement
of an intention to make, a tender offer or exchange offer the
consummation of which would result in the beneficial ownership by
a person or group of 15% or more of the outstanding shares of
Common Stock (the earlier of such dates being called the
"Distribution Date"), the Rights will be evidenced, with respect
to any of the Common Stock certificates outstanding as of the
Record Date, by such Common Stock certificate together with a
copy of this Summary of Rights.
The Rights Agreement provides that, until the
Distribution Date (or earlier expiration of the Rights), the
Rights will be transferred with and only with the Common Stock.
Until the Distribution Date (or earlier expiration of the
Rights), new Common Stock certificates issued after the Record
Date upon transfer or new issuances of Common Stock will contain
a notation incorporating the Rights Agreement by reference.
Until the Distribution Date (or earlier expiration of the
Rights), the surrender for transfer of any certificates for
shares of Common Stock outstanding as of the Record Date, even
without such notation or a copy of this Summary of Rights, will
also constitute the transfer of the Rights associated with the
shares of Common Stock represented by such certificate. As soon
as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Right Certificates") will be
mailed to holders of record of the Common Stock as of the close
of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution
Date. The Rights will expire on July 12, 2006 (the "Final
Expiration Date"), unless the Final Expiration Date is advanced
or extended or unless the Rights are earlier redeemed or
exchanged by the Company, in each case as described below.
The Purchase Price payable, and the number of shares of
Preferred Stock or other securities or property issuable, upon
exercise of the Rights is subject to adjustment from time to time
to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred
Stock, (ii) upon the grant to holders of the Preferred Stock of
certain rights or warrants to subscribe for or purchase Preferred
Stock at a price, or securities convertible into Preferred Stock
with a conversion price, less than the then-current market price
of the Preferred Stock or (iii) upon the distribution to holders
of the Preferred Stock of evidences of indebtedness or assets
(excluding regular periodic cash dividends or dividends payable
in Preferred Stock) or of subscription rights or warrants (other
than those referred to above).
The number of outstanding Rights is subject to
adjustment in the event of a stock dividend on the Common Stock
payable in shares of Common Stock or subdivisions, consolidations
or combinations of the Common Stock occurring, in any such case,
prior to the Distribution Date.
Shares of Preferred Stock purchasable upon exercise of
the Rights will not be redeemable. Each share of Preferred Stock
will be entitled, when, as and if declared, to a minimum
preferential quarterly dividend payment of $1.00 per share but
will be entitled to an aggregate dividend of 1000 times the
dividend declared per share of Common Stock. In the event of
liquidation, dissolution or winding up of the Company, the
holders of the Preferred Stock will be entitled to a minimum
preferential payment of $100 per share (plus any accrued but
unpaid dividends) but will be entitled to an aggregate payment of
1000 times the payment made per share of Common Stock. Each
share of Preferred Stock will have 1000 votes, voting together
with the Common Stock. Finally, in the event of any merger,
consolidation or other transaction in which outstanding shares of
Common Stock are converted or exchanged, each share of Preferred
Stock will be entitled to receive 1000 times the amount received
per share of Common Stock. These rights are protected by
customary antidilution provisions.
Because of the nature of the Preferred Stock's
dividend, liquidation and voting rights, the value of the one
one-thousandth interest in a share of Preferred Stock purchasable
upon exercise of each Right should approximate the value of one
share of Common Stock.
In the event that any person or group of affiliated or
associated persons becomes an Acquiring Person, each holder of a
Right, other than Rights beneficially owned by the Acquiring
Person (which will thereupon become void), will thereafter have
the right to receive upon exercise of a Right that number of
shares of Common Stock having a market value of two times the
exercise price of the Right.
In the event that, after a person or group has become
an Acquiring Person, the Company is acquired in a merger or other
business combination transaction or 50% or more of its
consolidated assets or earning power are sold, proper provisions
will be made so that each holder of a Right (other than Rights
beneficially owned by an Acquiring Person which will have become
void) will thereafter have the right to receive upon the exercise
of a Right that number of shares of common stock of the person
with whom the Company has engaged in the foregoing transaction
(or its parent) that at the time of such transaction have a
market value of two times the exercise price of the Right.
At any time after any person or group becomes an
Acquiring Person and prior to the earlier of one of the events
described in the previous paragraph or the acquisition by such
Acquiring Person of 50% or more of the outstanding shares of
Common Stock, the Board of Directors of the Company may exchange
the Rights (other than Rights owned by such Acquiring Person
which will have become void), in whole or in part, for shares of
Common Stock or Preferred Stock (or a series of the Company's
preferred stock having equivalent rights, preferences and
privileges), at an exchange ratio of one share of Common Stock,
or a fractional share of Preferred Stock (or other preferred
stock) equivalent in value thereto, per Right.
With certain exceptions, no adjustment in the Purchase
Price will be required until cumulative adjustments require an
adjustment of at least 1% in such Purchase Price. No fractional
shares of Preferred Stock or Common Stock will be issued (other
than fractions of Preferred Stock which are integral multiples of
one one-thousandths of a share of Preferred Stock, which may, at
the election of the Company, be evidenced by depositary
receipts), and in lieu thereof an adjustment in cash will be made
based on the current market price of the Preferred Stock or the
Common Stock.
At any time prior to the time an Acquiring Person
becomes such, the Board of Directors of the Company may redeem
the Rights in whole, but not in part, at a price of $.01 per
Right (the "Redemption Price"). The redemption of the Rights may
be made effective at such time, on such basis and with such
conditions as the Board of Directors in its sole discretion may
establish. Immediately upon any redemption of the Rights, the
right to exercise the Rights will terminate and the only right of
the holders of Rights will be to receive the Redemption Price.
For so long as the Rights are then redeemable, the
Company may, except with respect to the redemption price, amend
the Rights Agreement in any manner. After the Rights are no
longer redeemable, the Company may, except with respect to the
redemption price, amend the Rights Agreement in any manner that
does not adversely affect the interests of holders of the Rights.
Until a Right is exercised or exchanged, the holder
thereof, as such, will have no rights as a stockholder of the
Company, including, without limitation, the right to vote or to
receive dividends.
A copy of the Rights Agreement has been filed with the
Securities and Exchange Commission as an Exhibit to a
Registration Statement on Form 8-A dated July __, 1996. A copy
of the Rights Agreement is available free of charge from the
Company. This summary description of the Rights does not purport
to be complete and is qualified in its entirety by reference to
the Rights Agreement, as the same may be amended from time to
time, which is hereby incorporated herein by reference.