Exhibit 99
DESCRIPTION OF REYNOLDS METALS COMPANY CAPITAL STOCK
The Company is authorized by its Restated Certificate of
Incorporation to issue a total of 221,000,000 shares of capital
stock, consisting of (i) 200,000,000 shares of common stock,
without par value (the "Common Stock"), (ii) 20,000,000 shares of
preferred stock, without par value (the "Preferred Stock"), and
(iii) 1,000,000 shares of second preferred stock, $100 par value
(the "Second Preferred Stock"). Shares of Preferred Stock and
Second Preferred Stock are issuable in one or more series, each
with such designations, preferences, rights, qualifications,
limitations and restrictions as the Board of Directors of the
Company may determine in resolutions providing for their
issuance.
As of April 27, 2000, there were issued, outstanding and
entitled to vote 63,681,199 shares of Common Stock. No shares of
Preferred Stock or Second Preferred Stock are currently
outstanding, although the Board of Directors has adopted
resolutions authorizing the issuance of up to 2,000,000 shares of
a Series A Junior Participating Preferred Stock, without par
value, issuable upon the occurrence of certain events as
described below in the section entitled "Common Stock - Preferred
Stock Purchase Rights."
COMMON STOCK
DIVIDEND RIGHTS AND RESTRICTIONS ON PAYMENT OF DIVIDENDS.
Holders of Common Stock are entitled to receive dividends, when
and as declared by the Board of Directors, subject to
restrictions which may be imposed by (i) resolutions providing
for the issuance of series of Preferred Stock or Second Preferred
Stock; and (ii) certain credit agreements of the Company, as
described below. Dividends on Preferred Stock and Second
Preferred Stock may be cumulative, and no payments or
distributions (except in Common Stock or other junior stock) may
be made on Common Stock, nor may any Common Stock be acquired by
the Company, unless all past and current dividends on Preferred
Stock and Second Preferred Stock have been paid or provided for.
Under certain of the Company's credit agreements, the Company may
not declare or pay dividends on, make any payment on account of,
or set apart assets for a sinking or other analogous fund for the
purchase, redemption, defeasance, retirement or other acquisition
of, any shares of capital stock of the Company, nor may the
Company make any other distribution in respect thereof, if
specified events of default (including payment defaults and
events relating to bankruptcy, insolvency or reorganization) have
occurred and are continuing. No such events of default have
occurred.
VOTING RIGHTS. Holders of Common Stock are entitled to one
vote for each share held of record and are not entitled to
cumulate votes for the election of directors. As a consequence,
holders of more than 50% of the shares of Common Stock voting for
the election of directors can elect all of the directors if they
so choose; in such event, the holders of the remaining shares of
Common Stock would not be able to elect any directors. Holders
of Common Stock have voting powers on all matters requiring
approval of stockholders, other than certain matters subject to
the voting rights of holders of the Company's Preferred Stock and
Second Preferred Stock to the
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extent provided in the applicable resolutions authorizing their
issuance or otherwise under Delaware law.
LIQUIDATION RIGHTS. In the event of liquidation,
dissolution or winding up of the Company, holders of Common Stock
are entitled to share ratably in the assets of the Company
remaining after payment or provision for payment of all the
Company's debts and other liabilities and after the holders of
any outstanding series of Preferred Stock and Second Preferred
Stock have been paid the full preferential amounts due them. Any
preferential rights to be accorded holders of Preferred Stock and
Second Preferred Stock will be set forth in resolutions of the
Board of Directors authorizing issuance of any series.
PREEMPTIVE RIGHTS; ASSESSABILITY. Holders of Common Stock
have no preemptive or conversion rights and there are no
redemption or sinking fund provisions applicable thereto. The
outstanding shares of Common Stock are fully paid and non-
assessable.
TRANSFER AGENT AND REGISTRAR. The transfer agent and
registrar for the Common Stock is ChaseMellon Shareholder
Services, L.L.C., 450 West 33rd Street, 15th Floor, New York, New
York 10001.
PREFERRED STOCK PURCHASE RIGHTS. On November 21, 1997, the
Board of Directors of the Company declared a dividend
distribution of one Preferred Stock Purchase Right (individually
a "Right", and collectively the "Rights") for each outstanding
share of Common Stock to stockholders of record at the close of
business on December 1, 1997. The description and terms of the
Rights are set forth in an Amended and Restated Rights Agreement,
dated as of March 8, 1999, as amended by the First Amendment
dated August 20, 1999 (as amended, the "Rights Agreement"),
between the Company and ChaseMellon Shareholder Services, L.L.C.,
as Rights Agent.
The Rights are exercisable only if a person or group buys
15% or more of the Company's Common Stock, or announces a tender
offer for 15% or more of the outstanding Common Stock. Each
Right will entitle a holder to buy one-hundredth of a share of
the Company's Series A Junior Participating Preferred Stock at an
exercise price of $300, subject to adjustment in certain
circumstances.
If a person or group acquires 15% or more of the Common
Stock, each Right would permit its holder to buy Common Stock
having a market value equal to two times the exercise price of
the Right. In addition, if at any time after the Rights become
exercisable, the Company is acquired in a merger, or if there is
a sale or transfer of 50% or more of its assets or earning power,
each Right would permit its holder to buy common stock of the
acquiring company having a market value equal to two times the
exercise price of the Right.
The Rights, which do not have voting privileges, expire on
December 1, 2007. The Board of Directors of the Company may
redeem the Rights before expiration, under certain circumstances,
for $0.01 per Right (the "Redemption Price").
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For so long as the Rights are redeemable, the Rights
Agreement may be amended from time to time by the Company in its
sole discretion. After the Rights have ceased to be redeemable,
the Company may not adopt any amendment that adversely affects
the interests of any holder of a Right, cause the Rights
Agreement to be amendable other than in accordance with this
sentence, or cause the Rights again to become redeemable.
Notwithstanding the foregoing, the Company may not under any
circumstances change the Redemption Price of the Rights.
On August 18, 1999, the Company, Alcoa Inc. ("Alcoa"), and
RLM Acquisition Corp., a wholly owned subsidiary of Alcoa,
entered into an agreement and plan of merger (the "Merger
Agreement"). Under the Merger Agreement, each outstanding share
of Company Common Stock would be converted into 1.06 shares of
Alcoa common stock and the Company would become wholly owned by
Alcoa. Completion of the merger is subject to customary closing
conditions, including antitrust clearances. On August 20, 1999,
the Company amended the Rights Agreement to render it
inapplicable to the transaction contemplated by the Merger
Agreement.
DELAWARE GENERAL CORPORATION LAW SECTION 203
The Company is subject to the provisions of Section 203 of
the General Corporation Law of the State of Delaware ("DGCL
Section 203"), the "business combination" statute. In general,
the statute prohibits a public Delaware corporation from engaging
in a "business combination" with an "interested stockholder" for
a period of three years after the date of the transaction in
which the person became an interested stockholder, unless (i)
prior to such date, the board of directors of the corporation
approved either the business combination or the transaction that
resulted in the stockholder becoming an interested stockholder,
(ii) upon consummation of the transaction that resulted in the
stockholder becoming an interested stockholder, the interested
stockholder owned at least 85% of the voting stock of the
corporation outstanding at the time the transaction commenced
(excluding certain shares described in DGCL Section 203), or
(iii) on or after such date, the business combination is approved
by the board of directors of the corporation and authorized at an
annual or special meeting of stockholders and by the affirmative
vote of at least two-thirds of the outstanding voting stock that
is not owned by the "interested stockholder". "Business
combination" is defined to include mergers, asset sales and
certain other transactions resulting in a financial benefit to a
stockholder. An "interested stockholder" is defined generally as
a person who, together with affiliates and associates, owns (or,
within the prior three years, did own) 15% or more of a
corporation's voting stock. The Company's Restated Certificate
of Incorporation does not exclude the Company from the
restrictions imposed under DGCL Section 203. Thus, such statute
could prohibit or delay the accomplishment of mergers or other
takeover or change in control attempts with respect to the
Company and, accordingly, may discourage attempts to acquire the
Company.
The Company's Board of Directors has approved the Merger
Agreement for the purpose of exempting the proposed merger with
Alcoa from the operation of DGCL Section 203.
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