1
EX-4
EXECUTION COPY
---------------------------------------------------------------------------
ANHEUSER-BUSCH COMPANIES, INC.
and
BOATMEN'S TRUST COMPANY
Rights Agent
------------------
Rights Agreement
Dated as of October 26, 1994
------------------------------------------------------------------------------
2
Table of Contents
-----------------
Section Page
------- ----
1. Certain Definitions . . . . . . . . . . . . . . . . . . . . . 2
2. Appointment of Rights Agent . . . . . . . . . . . . . . . . . 6
3. Issue of Rights Certificates. . . . . . . . . . . . . . . . . 6
4. Form of Rights Certificates . . . . . . . . . . . . . . . . . 8
5. Countersignature and Registration . . . . . . . . . . . . . . 9
6. Transfer, Split Up, Combination and Exchange of
Rights Certificates; Mutilated, Destroyed,
Lost or Stolen Rights Certificates . . . . . . . . . . . 10
7. Exercise of Rights; Purchase Price; Expiration
Date of Rights . . . . . . . . . . . . . . . . . . . . . 11
8. Cancellation and Destruction of Rights Certifi-
cates. . . . . . . . . . . . . . . . . . . . . . . . . . 14
9. Reservation and Availability of Capital Stock . . . . . . . . 15
10. Preferred Stock Record Date . . . . . . . . . . . . . . . . . 17
11. Adjustment of Purchase Price, Number and Kind of
Shares or Number of Rights . . . . . . . . . . . . . . . 17
12. Certificate of Adjusted Purchase Price or Number
of Shares. . . . . . . . . . . . . . . . . . . . . . . . 30
13. Consolidation, Merger or Sale or Transfer of As-
sets or Earning Power. . . . . . . . . . . . . . . . . . 31
14. Fractional Rights and Fractional Shares . . . . . . . . . . . 34
15. Rights of Action. . . . . . . . . . . . . . . . . . . . . . . 35
16. Agreement of Rights Holders . . . . . . . . . . . . . . . . . 36
17. Rights Certificate Holder Not Deemed a Stockhold-
er . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
i
3
18. Concerning the Rights Agent . . . . . . . . . . . . . . . . . 37
19. Merger or Consolidation or Change of Name of
Rights Agent . . . . . . . . . . . . . . . . . . . . . . 38
20. Duties of Rights Agent. . . . . . . . . . . . . . . . . . . . 39
21. Change of Rights Agent. . . . . . . . . . . . . . . . . . . . 42
22. Issuance of New Rights Certificates . . . . . . . . . . . . . 43
23. Redemption and Termination. . . . . . . . . . . . . . . . . . 43
24. Notice of Certain Events. . . . . . . . . . . . . . . . . . . 45
25. Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
26. Supplements and Amendments. . . . . . . . . . . . . . . . . . 47
27. Successors. . . . . . . . . . . . . . . . . . . . . . . . . . 48
28. Determinations and Actions by the Board of Direc-
tors, etc. . . . . . . . . . . . . . . . . . . . . . . . 48
29. Benefits of this Agreement. . . . . . . . . . . . . . . . . . 49
30. Severability. . . . . . . . . . . . . . . . . . . . . . . . . 49
31. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . 49
32. Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . 50
33. Descriptive Headings. . . . . . . . . . . . . . . . . . . . . 50
Exhibit A -- Form of Rights Certificate. . . . . . . . . . . . . . A-1
ii
4
RIGHTS AGREEMENT
----------------
RIGHTS AGREEMENT, dated as of October 26, 1994
(the "Agreement"), between Anheuser-Busch Companies, Inc.,
a Delaware corporation (the "Company"), and Boatmen's Trust
Company, a trust company organized under the laws of the
State of Missouri (the "Rights Agent").
W I T N E S S E T H
- - - - - - - - - -
WHEREAS, on December 18, 1985, the Board of
Directors of the Company authorized and declared a dividend
distribution of one right for each share of Common Stock
(as hereinafter defined) of the Company outstanding at the
close of business on December 27, 1985 (the "1985 Record
Date"), and authorized the issuance of one right for each
share of Common Stock of the Company issued between the
1985 Record Date (whether originally issued or delivered
from the Company's treasury) and the Distribution Date (as
defined in the Rights Agreement, dated as of December 18,
1985, as amended on July 23, 1986 (the "1985 Agreement")
and as amended and restated as of December 17, 1986 (the
"1986 Agreement") between the Company and Centerre Trust
Company of St. Louis, the predecessor to the Rights Agent),
each right initially representing the right to purchase one
one-hundredth of a share of Series B Junior Participating
Preferred Stock of the Company having the rights, powers
and preferences set forth in the Restated Certificate of
Incorporation of the Company (the "Certificate of Incorpo-
ration"), upon the terms and subject to the conditions set
forth in the 1985 Agreement (the "1985 Rights");
WHEREAS, on July 23, 1986, the Board of Direc-
tors, in accordance with Section 26 of the 1985 Agreement,
determined it desirable and in the best interests of the
Company and its stockholders for the Company to supplement
and amend certain provisions of the 1985 Agreement and on
July 23, 1986 implemented such changes by executing an
amendment to the 1985 Agreement;
WHEREAS, effective as of December 17, 1986, the
Board of Directors in accordance with Section 26 of the
1985 Agreement, determined it desirable and in the best
interests of the Company and its stockholders for the
5
Company to amend and restate the 1985 Agreement and on
December 17, 1986 implemented such amendment and restate-
ment by executing the 1986 Agreement;
WHEREAS, on October 26, 1994, the Board of
Directors determined it desirable and in the best interests
of the Company and its stockholders for the Company to
extend the 1986 Agreement and to implement such extension
by executing this Agreement; and
WHEREAS, on October 26, 1994 (the "Rights
Dividend Declaration Date"), the Board of Directors of the
Company authorized and declared a dividend distribution of
one Right for each share of Common Stock of the Company
outstanding upon the Expiration Date (as defined in the
1986 Agreement) (the "Record Date"), and authorized the
issuance of one Right (as such number may hereafter be
adjusted pursuant to the provisions of Section 11(p)
hereof) for each share of Common Stock of the Company
issued between the Record Date (whether originally issued
or delivered from the Company's treasury) and the Distribu-
tion Date, each Right initially representing the right to
purchase one one-hundredth of a share of Series B Junior
Participating Preferred Stock of the Company having the
rights, powers and preferences set forth in the Certificate
of Incorporation, upon the terms and subject to the
conditions hereinafter set forth (the "Rights").
NOW, THEREFORE, in consideration of the premises
and the mutual agreements herein set forth, the parties
hereby agree as follows:
Section 1. Certain Definitions. For purposes of
-------------------
this Agreement, the following terms have the meanings
indicated:
(a) "Acquiring Person" shall mean any
Person who or which, together with all Affiliates and
Associates of such Person, shall be the Beneficial Owner of
20% or more of the shares of Common Stock then outstanding,
but shall not include the Company, any Subsidiary of the
Company, any employee benefit plan of the Company or of any
Subsidiary of the Company, or any Person or entity orga-
nized, appointed or established by the Company for or
pursuant to the terms of any such plan, or any Person who
becomes an Acquiring Person solely as a result of a reduc-
tion in the number of shares of Common Stock outstanding
2
6
due to the repurchase of shares of Common Stock by the
Company, unless and until such Person shall purchase or
otherwise become the Beneficial Owner of additional shares
of Common Stock constituting 1% or more of the then
outstanding shares of Common Stock.
(b) "Affiliate" and "Associate" shall have
the respective meanings ascribed to such terms in Rule 12b-
2 of the General Rules and Regulations under the Securities
Exchange Act of 1934, as amended and in effect on the date
of this Agreement (the "Exchange Act").
(c) A Person shall be deemed the "Benefi-
cial Owner" of, and shall be deemed to "beneficially own,"
any securities:
(i) which such Person or any of
such Person's Affiliates or Associates, directly
or indirectly, has the right to acquire (whether
such right is exercisable immediately or only
after the passage of time) pursuant to any
agreement, arrangement or understanding (whether
or not in writing) 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,"
(A) securities tendered pursuant to a tender or
exchange offer made by such Person or any of
such Person's Affiliates or Associates until
such tendered securities are accepted for pur-
chase or exchange, or (B) securities issuable
upon exercise of Rights at any time prior to the
occurrence of a Triggering Event, or (C) securi-
ties issuable upon exercise of Rights from and
after the occurrence of a Triggering Event which
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 (the "Original
Rights") or pursuant to Section 11(i) hereof in
connection with an adjustment made with respect
to any Original Rights;
(ii) which such Person or any of
such Person's Affiliates or Associates, directly
or indirectly, has the right to vote or dispose
3
7
of or has "beneficial ownership" of (as deter-
mined pursuant to Rule 13d-3 of the General
Rules and Regulations under the Exchange Act),
including pursuant to any agreement, arrangement
or understanding, whether or not in writing;
provided, however, that a Person shall not be
--------
deemed the "Beneficial Owner" of, or to "benefi-
cially own," any security under this subpara-
graph (ii) as a result of an agreement, arrange-
ment or understanding to vote such security if
such agreement, arrangement or understanding:
(A) arises solely from a revocable proxy given
in response to a public proxy or consent solici-
tation made pursuant to, and in accordance with,
the applicable provisions of the General Rules
and Regulations under the Exchange Act, and (B)
is not also then reportable by such Person 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 (or any Affiliate or Associate thereof)
with which such Person (or any of such Person's
Affiliates or Associates) has any agreement,
arrangement or understanding (whether or not in
writing), for the purpose of acquiring, holding,
voting (except pursuant to a revocable proxy as
described in the proviso to subparagraph (ii) of
this paragraph (c)) or disposing of any voting
securities of the Company; provided, however,
--------
that nothing in this paragraph (c) shall cause a
Person engaged in the business as an underwriter
of securities to be deemed the "Beneficial
Owner" of, or to "beneficially own," any securi-
ties acquired through such Person's participa-
tion in good faith in a firm commitment under-
writing until the expiration of forty days after
the date of such acquisition.
(d) "Business Day" shall mean any day other
than a Saturday, Sunday or a day on which banking institu-
tions in the State of Missouri are authorized or obligated
by law or executive order to close.
(e) "Close of business" on any given date
shall mean 4:45 P.M., St. Louis time, on such date;
4
8
provided, however, that if such date is not a Business Day
--------
it shall mean 4:45 P.M., St. Louis time, on the next
succeeding Business Day.
(f) "Common Stock" shall mean the common
stock, par value $1.00 per share, of the Company, except
that "Common Stock" when used with reference to any Person
other than the Company shall mean the capital stock of such
Person with the greatest voting power, or the equity
securities or other equity interest having power to control
or direct the management, of such Person.
(g) "Continuing Director" shall mean (i)
any member of the Board of Directors of the Company, while
such Person is a member of the Board, who is not an
Acquiring Person, or an Affiliate or Associate of an
Acquiring Person, or a representative of an Acquiring
Person or of any such Affiliate or Associate, and was a
member of the Board prior to the date of this Agreement, or
(ii) any Person who subsequently becomes a member of the
Board, while such Person is a member of the Board, who is
not an Acquiring Person, or an Affiliate or Associate of an
Acquiring Person, or a representative of an Acquiring
Person or of any such Affiliate or Associate, if such
Person's nomination for election or election to the Board
is recommended or approved by a majority of the Continuing
Directors.
(h) "Person" shall mean any individual,
firm, corporation, partnership or other entity.
(i) "Preferred Stock" shall mean shares of
Series B Junior Participating Preferred Stock, par value
$1.00 per share, of the Company and, to the extent that
there are not a sufficient number of shares of Series B
Junior Participating Preferred Stock authorized to permit
the full exercise of the Rights, any other series of
Preferred Stock of the Company designated for such purpose
containing terms substantially similar to the terms of the
Series B Junior Participating Preferred Stock.
(j) "Section 11(a)(ii) Event" shall mean
any event described in Section 11(a)(ii)(A) or (B) hereof.
(k) "Section 13 Event" shall mean any event
described in clauses (x), (y) or (z) of Section 13(a)
hereof.
5
9
(l) "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) under the Exchange
Act) by the Company or an Acquiring Person that an Acquir-
ing Person has become such.
(m) "Subsidiary" shall mean, with reference
to any Person, any corporation of which an amount of voting
securities sufficient to elect at least a majority of the
directors of such corporation is beneficially owned,
directly or indirectly, by such Person, or otherwise
controlled by such Person.
(n) "Triggering Event" shall mean any
Section 11(a)(ii) Event or any Section 13 Event.
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 also be the holders of the Common Stock)
in accordance with the terms and conditions hereof, and the
Rights Agent hereby accepts such appointment. The Company
may from time to time appoint such Co-Rights Agents as it
may deem necessary or desirable.
Section 3. Issue of Rights Certificates.
----------------------------
(a) Until the earlier of (i) the close of
business on the tenth business day after the Stock Acquisi-
tion Date, or (ii) the close of business on the tenth
business day after the date that a tender or exchange offer
by any Person (other than the Company, any Subsidiary of
the Company, any employee benefit plan of the Company or of
any Subsidiary of the Company, or any Person or entity
organized, appointed or established by the Company for or
pursuant to the terms of any such plan) is first published
or sent or given within the meaning of Rule 14d-2(a) of the
General Rules and Regulations under the Exchange Act, if
upon consummation thereof, such Person would be the
Beneficial Owner of 30% or more of the shares of Common
Stock then outstanding (the earlier of (i) and (ii) being
herein referred to as the "Distribution Date"), (x) the
Rights will be evidenced (subject to the provisions of
paragraph (b) of this Section 3) by the certificates for
the Common Stock registered in the names of the holders of
6
10
the Common Stock (which certificates for Common Stock shall
be deemed also to be certificates for Rights) and not by
separate certificates, and (y) the Rights will be transfer-
able only in connection with the transfer of the underlying
shares of Common Stock (including a transfer to the
Company). As soon as practicable after the Distribution
Date, the Rights Agent will send by first-class, insured,
postage prepaid mail, to each record holder of the Common
Stock as of the close of business on the Distribution Date,
at the address of such holder shown on the records of the
Company, one or more right certificates, in substantially
the form of Exhibit B hereto (the "Rights Certificates"),
evidencing one Right for each share of Common Stock so
held, subject to adjustment as provided herein. In the
event that an adjustment in the number of Rights per share
of Common Stock has been made pursuant to Section 11(p)
hereof, at the time of distribution of the Right Certifi-
cates, the Company shall make the necessary and appropriate
rounding adjustments (in accordance with Section 14(a)
hereof) so that Rights Certificates representing only whole
numbers of Rights are distributed and cash is paid in lieu
of any fractional Rights. As of and after the Distribution
Date, the Rights will be evidenced solely by such Rights
Certificates.
(b) Rights shall be issued in respect of
all shares of Common Stock which are issued after the
Record Date but prior to the earlier of the Distribution
Date or the Expiration Date. Certificates representing
such shares of Common Stock shall also be deemed to be
certificates for Rights, and shall bear the following
legend:
This certificate also evidences and enti-
tles the holder hereof to certain Rights as set
forth in the Rights Agreement between Anheuser-
Busch Companies, Inc. and Boatmen's Trust Compa-
ny, dated as of October 26, 1994 (the "Rights
Agreement"), the terms of which are hereby
incorporated herein by reference and a copy of
which is on file at the principal offices of
Anheuser-Busch Companies, Inc. Under certain
circumstances, as set forth in the Rights Agree-
ment, such Rights will be evidenced by separate
certificates and will no longer be evidenced by
this certificate. Anheuser-Busch Companies,
Inc. will mail to the holder of this certificate
7
11
a copy of the Rights Agreement, as in effect on
the date of mailing, without charge promptly
after receipt of a written request therefor.
Under certain circumstances set forth in the
Rights Agreement, Rights issued to, or held by,
any Person who is, was or becomes an Acquiring
Person or any Affiliate or Associate thereof (as
such terms are defined in the Rights Agreement),
whether currently held by or on behalf of such
Person or by any subsequent holder, may become
null and void.
With respect to such certificates containing the foregoing
legend and certificates containing the legends specified in
the 1985 Agreement and the 1986 Agreement and with respect
to previously issued certificates that contain no compara-
ble legend, until the earlier of (i) the Distribution Date
or (ii) the Expiration Date, the Rights associated with the
Common Stock represented by such certificates shall be
evidenced by such certificates alone and registered holders
of Common Stock shall also be the registered holders of the
associated Rights, and the transfer of any of such certifi-
cates shall also constitute the transfer of the Rights
associated with the Common Stock represented by such
certificates.
Section 4. Form of Rights Certificates.
---------------------------
(a) The Rights Certificates (and the forms
of election to purchase and of assignment to be printed on
the reverse thereof) shall each be substantially in the
form set forth in Exhibit A hereto and may have such marks
of identification or designation and such legends, summa-
ries 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 regula-
tion made pursuant thereto or with any rule or regulation
of any stock exchange on which the Rights may from time to
time be listed, or to conform to usage. Subject to the
provisions of Section 11 and Section 22 hereof, the Rights
Certificates, whenever distributed, shall be dated as of
the Record Date and on their face shall entitle the holders
thereof to purchase such number of one one-hundredths of a
share of Preferred Stock as shall be set forth therein at
the price set forth therein (such exercise price per one
one-hundredth of a share, the "Purchase Price"), but the
8
12
amount and type of securities purchasable upon the exercise
of each Right and the Purchase Price thereof shall be
subject to adjustment as provided herein.
(b) Any Rights Certificate issued pursuant
to Section 3(a) or Section 22 hereof that represents Rights
beneficially owned by: (i) an Acquiring Person or any
Associate or Affiliate of an Acquiring Person, (ii) a
transferee of an Acquiring Person (or of any such Associate
or Affiliate) who becomes a transferee after the Acquiring
Person becomes such, or (iii) a transferee of an Acquiring
Person (or of any such Associate or Affiliate) who becomes
a transferee prior to or concurrently with the Acquiring
Person becoming such and receives such Rights pursuant to
either (A) a transfer (whether or not for consideration)
from the Acquiring Person to holders of equity interests in
such Acquiring Person or to any Person with whom such
Acquiring Person has any continuing agreement, arrangement
or understanding regarding the transferred Rights or (B) a
transfer which the Board of Directors of the Company has
determined is part of a plan, arrangement or understanding
which has as a primary purpose or effect avoidance of
Section 7(e) hereof, and any Rights Certificate issued
pursuant to Section 6 or Section 11 hereof upon transfer,
exchange, replacement or adjustment of any other Rights
Certificate referred to in this sentence, shall contain (to
the extent feasible) the following legend:
The Rights represented by this Rights Certifi-
cate are or were beneficially owned by a Person
who was or became an Acquiring Person or an
Affiliate or Associate of an Acquiring Person
(as such terms are defined in the Rights Agree-
ment). Accordingly, this Rights Certificate and
the Rights represented hereby may become null
and void in the circumstances specified in
Section 7(e) of such Agreement.
Section 5. Countersignature and Registration.
---------------------------------
(a) The Rights Certificates shall be
executed on behalf of the Company by its Chairman of the
Board, its President or any Vice President, either manually
or by facsimile signature, and shall have affixed thereto
the Company's seal or a facsimile thereof which shall be
attested by the Secretary or an Assistant Secretary of the
Company, either manually or by facsimile signature. The
9
13
Rights Certificates shall be manually countersigned by the
Rights Agent and shall not be valid for any purpose unless
so countersigned. In case any officer of the Company who
shall have signed any of the Rights Certificates shall
cease to be such officer of the Company before countersig-
nature by the Rights Agent and issuance and delivery by the
Company, such Rights 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 Rights Certificates had not ceased
to be such officer of the Company; and any Rights Certifi-
cates may be signed on behalf of the Company by any person
who, at the actual date of the execution of such Rights
Certificate, shall be a proper officer of the Company to
sign such Rights Certificate, although at the date of the
execution of this Rights 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 its princi-
pal office or offices designated as the appropriate place
for surrender of Rights Certificates upon exercise or
transfer, books for registration and transfer of the Rights
Certificates issued hereunder. Such books shall show the
names and addresses of the respective holders of the Rights
Certificates, the number of Rights evidenced on its face by
each of the Rights Certificates and the date of each of the
Rights Certificates.
Section 6. Transfer, Split Up, Combination and
-----------------------------------
Exchange of Rights Certificates; Mutilated, Destroyed, Lost
-----------------------------------------------------------
or Stolen Rights Certificates. (a) Subject to the provi-
-----------------------------
sions of Section 4(b), Section 7(e) and Section 14 hereof,
at any time after the close of business on the Distribution
Date, and at or prior to the close of business on the
Expiration Date, any Rights Certificate or Certificates may
be transferred, split up, combined or exchanged for another
Rights Certificate or Certificates, entitling the regis-
tered holder to purchase a like number of one one-hun-
dredths of a share of Preferred Stock (or, following a
Triggering Event, Common Stock, other securities, cash or
other assets, as the case may be) as the Rights Certificate
or Certificates surrendered then entitled such holder (or
former holder in the case of a transfer) to purchase. Any
registered holder desiring to transfer, split up, combine
or exchange any Rights Certificate or Certificates shall
make such request in writing delivered to the Rights Agent,
10
14
and shall surrender the Rights Certificate or Certificates
to be transferred, split up, combined or exchanged at the
principal office or offices of the Rights Agent designated
for such purpose. Neither the Rights Agent nor the Company
shall be obligated to take any action whatsoever with
respect to the transfer of any such surrendered Rights
Certificate until the registered holder shall have complet-
ed and signed the certificate contained in the form of
assignment on the reverse side of such Rights Certificate
and shall have provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial
Owner) or Affiliates or Associates thereof as the Company
shall reasonably request. Thereupon the Rights Agent
shall, subject to Section 4(b), Section 7(e) and Section 14
hereof, countersign and deliver to the Person entitled
thereto a Rights Certificate or Rights Certificates, as the
case may be, as so requested. The Company may require
payment of a sum sufficient to cover any tax or governmen-
tal charge that may be imposed in connection with any
transfer, split up, combination or exchange of Rights
Certificates.
(b) Upon receipt by the Company and the
Rights Agent of evidence reasonably satisfactory to them of
the loss, theft, destruction or mutilation of a Rights
Certificate, and, in case of loss, theft or destruction, of
indemnity or security reasonably satisfactory to them, and
reimbursement to the Company and the Rights Agent of all
reasonable expenses incidental thereto, and upon surrender
to the Rights Agent and cancellation of the Rights Certifi-
cate if mutilated, the Company will execute and deliver a
new Rights Certificate of like tenor to the Rights Agent
for countersignature and delivery to the registered owner
in lieu of the Rights Certificate so lost, stolen, de-
stroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price;
-----------------------------------
Expiration Date of Rights. (a) Subject to Section 7(e)
-------------------------
hereof, the registered holder of any Rights Certificate may
exercise the Rights evidenced thereby (except as otherwise
provided herein including, without limitation, the restric-
tions on exercisability set forth in Section 9(c), Section
11(a)(iii) and Section 23(a) hereof) in whole or in part at
any time after the Distribution Date upon surrender of the
Rights Certificate, with the form of election to purchase
and the certificate on the reverse side thereof duly
executed, to the Rights Agent at the principal office or
11
15
offices 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-hundredths of a
share of Preferred Stock (or other securities, cash or
other assets, as the case may be) as to which such surren-
dered Rights are then exercisable, at or prior to the
earlier of (i) the close of business on October 31, 2004
(the "Final Expiration Date"), or (ii) the time at which
the Rights are redeemed as provided in Section 23 hereof
(the earlier of (i) and (ii) being herein referred to as
the "Expiration Date").
(b) The Purchase Price for each one one-
hundredth of a share of Preferred Stock pursuant to the
exercise of a Right shall initially be $195, and shall be
subject to adjustment from time to time as provided in
Sections 11 and 13(a) hereof and shall be payable in
accordance with paragraph (c) below.
(c) Upon receipt of a Rights Certificate
representing exercisable Rights, with the form of election
to purchase and the certificate duly executed, accompanied
by payment, with respect to each Right so exercised, of the
Purchase Price per one one-hundredth of a share of Pre-
ferred Stock (or other shares, securities, cash or other
assets, as the case may be) to be purchased as set forth
below and an amount equal to any applicable transfer tax,
the Rights Agent shall, subject to Section 20(k) hereof,
thereupon promptly (i) (A) requisition from any transfer
agent of the shares of Preferred Stock (or make available,
if the Rights Agent is the transfer agent for such shares)
certificates for the total number of one one-hundredths of
a share of Preferred Stock to be purchased and the Company
hereby irrevocably authorizes its transfer agent to comply
with all such requests, or (B) if the Company shall have
elected to deposit the total number of shares of Preferred
Stock issuable upon exercise of the Rights hereunder with
a depositary agent, requisition from the depositary agent
depositary receipts representing such number of one one-
hundredths of a share of Preferred Stock as are to be
purchased (in which case certificates for the shares of
Preferred Stock represented by such receipts shall be
deposited by the transfer agent with the depositary agent)
and the Company will direct the depositary agent to comply
with such request, (ii) requisition from the Company the
amount of cash, if any, to be paid in lieu of fractional
shares in accordance with Section 14 hereof, (iii) after
12
16
receipt of such certificates or depositary receipts, cause
the same to be delivered to or upon the order of the
registered holder of such Rights Certificate, registered in
such name or names as may be designated by such holder, and
(iv) after receipt thereof, deliver such cash, if any, to
or upon the order of the registered holder of such Rights
Certificate. The payment of the Purchase Price (as such
amount may be reduced pursuant to Section 11(a)(iii)
hereof) may be made (x) in cash or by certified bank check
or bank draft payable to the order of the Company, or (y)
by delivery of a certificate or certificates (with appro-
priate stock powers executed in blank attached thereto)
evidencing a number of shares of Common Stock equal to the
then Purchase Price divided by the closing price (as
determined pursuant to Section 11(d) hereof) per share of
Common Stock on the Trading Date immediately preceding the
date of such exercise. In the event that the Company is
obligated to issue other securities (including Common
Stock) of the Company, pay cash and/or distribute other
property pursuant to Section 11(a) hereof, the Company will
make all arrangements necessary so that such other securi-
ties, cash and/or other property are available for distri-
bution by the Rights Agent, if and when appropriate.
(d) In case the registered holder of any
Rights Certificate shall exercise less than all the Rights
evidenced thereby, a new Rights Certificate evidencing
Rights equivalent to the Rights remaining unexercised shall
be issued by the Rights Agent and delivered to, or upon the
order of, the registered holder of such Rights Certificate,
registered in such name or names as may be designated by
such holder, subject to the provisions of Section 14
hereof.
(e) Notwithstanding anything in this Agree-
ment to the contrary, from and after the first occurrence
of a Section 11(a)(ii) Event, any Rights beneficially owned
by (i) an Acquiring Person or an Associate or Affiliate of
an Acquiring Person, (ii) a transferee of an Acquiring
Person (or of any such Associate or Affiliate) who becomes
a transferee after the Acquiring Person becomes such, or
(iii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) who becomes a transferee prior to
or concurrently with the Acquiring Person becoming such and
receives such Rights pursuant to either (A) a transfer
(whether or not for consideration) from the Acquiring
Person to holders of equity interests in such Acquiring
13
17
Person or to any Person with whom the Acquiring Person has
any continuing agreement, arrangement or understanding
regarding the transferred Rights or (B) a transfer which
the Board of Directors of the Company has determined is
part of a plan, arrangement or understanding which has as
a primary purpose or effect the avoidance of this Section
7(e), shall become null and void without any further action
and no holder of such Rights shall have any rights whatso-
ever with respect to such Rights, whether under any
provision of this Agreement or otherwise. The Company
shall use all reasonable efforts to insure that the
provisions of this Section 7(e) and Section 4(b) hereof are
complied with, but shall have no liability to any holder of
Rights 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 trans-
ferees hereunder.
(f) Notwithstanding anything in this Agree-
ment to the contrary, neither the Rights Agent nor the
Company shall be obligated to undertake any action with
respect to a registered holder upon the occurrence of any
purported exercise as set forth in this Section 7 unless
such registered holder shall have (i) completed and signed
the certificate contained in the form of election to
purchase set forth on the reverse side of the Rights
Certificate surrendered for such exercise, and (ii)
provided such additional evidence of the identity of the
Beneficial Owner (or former Beneficial Owner) or Affiliates
or Associates thereof as the Company shall reasonably
request.
Section 8. Cancellation and Destruction of
-------------------------------
Rights Certificates. All Rights Certificates surrendered
-------------------
for the purpose of exercise, transfer, split up, combina-
tion or exchange shall, if surrendered to the Company or
any of its agents, be delivered to the Rights Agent for
cancellation or in cancelled form, or, if surrendered to
the Rights Agent, shall be cancelled by it, and no Rights
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 Rights Certificate pur-
chased or acquired by the Company otherwise than upon the
exercise thereof. The Rights Agent shall deliver all
cancelled Rights Certificates to the Company, or shall, at
14
18
the written request of the Company, destroy such cancelled
Rights Certificates, and in such case shall deliver a
certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of
-------------------------------
Capital 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 (and,
following the occurrence of a Triggering Event, out of its
authorized and unissued shares of Common Stock and/or other
securities or out of its authorized and issued shares held
in its treasury), the number of shares of Preferred Stock
(and, following the occurrence of a Triggering Event,
Common Stock and/or other securities) that, as provided in
this Agreement including Section 11(a)(iii) hereof, will be
sufficient to permit the exercise in full of all outstand-
ing Rights.
(b) So long as the shares of Preferred
Stock (and, following the occurrence of a Triggering Event,
Common Stock and/or other securities) issuable and deliver-
able upon the exercise of the Rights may be listed on any
national securities exchange, 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 on such exchange upon official notice
of issuance upon such exercise.
(c) The Company shall use its best efforts
to (i) file, as soon as practicable following the earliest
date after the first occurrence of a Section 11(a)(ii)
Event on which the consideration to be delivered by the
Company upon exercise of the Rights has been determined in
accordance with Section 11(a)(iii) hereof, or as soon as is
required by law following the Distribution Date, as the
case may be, a registration statement under the Securities
Act of 1933 (the "Act"), with respect to the securities
purchasable upon exercise of the Rights on an appropriate
form, (ii) cause such registration statement to become
effective as soon as practicable after such filing, and
(iii) cause such registration statement to remain effective
(with a prospectus at all times meeting the requirements of
the Act) until the earlier of (A) the date as of which the
Rights are no longer exercisable for such securities, and
(B) the date of the expiration of the Rights. The Company
will also take such action as may be appropriate under, or
to ensure compliance with, the securities or "blue sky"
15
19
laws of the various states in connection with the ex-
ercisability of the Rights. The Company may temporarily
suspend, for a period of time not to exceed ninety (90)
days after the date set forth in clause (i) of the first
sentence of this Section 9(c), the exercisability of the
Rights in order to prepare and file such registration
statement 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.
(d) The Company covenants and agrees that
it will take all such action as may be necessary to ensure
that all one one-hundredths of a share of Preferred Stock
(and, following the occurrence of a Triggering Event,
Common Stock and/or other securities) delivered upon
exercise of Rights shall, at the time of delivery of the
certificates for such shares (subject to payment of the
Purchase Price), be duly and validly authorized and issued
and fully paid and nonassessable.
(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
Rights Certificates and of any certificates for a number of
one one-hundredths of a share of Preferred Stock (or Common
Stock and/or other securities, as the case may be) 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 Rights Certificates
to a Person other than, or the issuance or delivery of a
number of one one-hundredths of a share of Preferred Stock
(or Common Stock and/or other securities, as the case may
be) in respect of a name other than that of, the registered
holder of the Rights Certificates evidencing Rights
surrendered for exercise or to issue or deliver any
certificates for a number of one one-hundredths of a share
of Preferred Stock (or Common Stock and/or other securi-
ties, as the case may be) in a name other than that of the
registered holder upon the exercise of any Rights until
such tax shall have been paid (any such tax being payable
16
20
by the holder of such Rights Certificate at the time of
surrender) or until it has been established to the Com-
pany's satisfaction that no such tax is due.
Section 10. Preferred Stock Record Date. Each
---------------------------
person in whose name any certificate for a number of one
one-hundredths of a share of Preferred Stock (or Common
Stock and/or other securities, as the case may be) is
issued upon the exercise of Rights shall for all purposes
be deemed to have become the holder of record of such
fractional shares of Preferred Stock (or Common Stock
and/or other securities, as the case may be) represented
thereby on, and such certificate shall be dated, the date
upon which the Rights Certificate evidencing such Rights
was duly surrendered and payment of the Purchase Price (and
all applicable transfer taxes) was made; provided, however,
--------
that if the date of such surrender and payment is a date
upon which the Preferred Stock (or Common Stock and/or
other securities, as the case may be) transfer books of the
Company are closed, such Person shall be deemed to have
become the record holder of such shares (fractional or
otherwise) on, and such certificate shall be dated, the
next succeeding Business Day on which the Preferred Stock
(or Common Stock and/or other securities, as the case may
be) transfer books of the Company are open. Prior to the
exercise of the Rights evidenced thereby, the holder of a
Rights Certificate shall not be entitled to any rights of
a stockholder of the Company with respect to shares for
which the Rights shall be exercisable, including, without
limitation, the right to vote, to receive dividends or
other distributions or to exercise any preemptive rights,
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 or Number of Rights. The Purchase
--------------------------------------
Price, the number and kind of shares covered by each Right
and the number of Rights outstanding are subject to
adjustment from time to time as provided in this Section
11.
(a)(i) In the event the Company
shall at any time after the date of this Agree-
ment (A) declare 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
17
21
smaller number of shares, or (D) issue any
shares of its capital stock in a reclassifica-
tion of the Preferred Stock (including any such
reclassification in connection with a consolida-
tion or merger in which the Company is the
continuing or surviving corporation), except as
otherwise provided in this Section 11(a) and
Section 7(e) hereof, the Purchase Price in
effect at the time of the record date for such
dividend or of the effective date of such subdi-
vision, combination or reclassification, and the
number and kind of shares of Preferred Stock or
capital stock, as the case may be, issuable on
such date, shall be proportionately adjusted so
that the holder of any Right exercised after
such time shall be entitled to receive, upon
payment of the Purchase Price then in effect,
the aggregate number and kind of shares of
Preferred Stock or capital stock, as the case
may be, 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, he would have owned upon such
exercise and been entitled to receive by virtue
of such dividend, subdivision, combination or
reclassification. If an event occurs which
would require an adjustment under both this
Section 11(a)(i) and Section 11(a)(ii) hereof,
the adjustment provided for in this Section
11(a)(i) shall be in addition to, and shall be
made prior to, any adjustment required pursuant
to Section 11(a)(ii) hereof.
(ii) In the event:
(A)(1) any Acquiring Person or
any Associate or Affiliate of any Acquiring
Person, at any time after the date of this
Agreement, directly or indirectly, shall merge
into the Company or otherwise combine with the
Company and the Company shall be the continuing
or surviving corporation of such merger or
combination and the Common Stock of the Company
shall remain outstanding and unchanged, or (2)
any Person (other than the Company, any Subsid-
iary of the Company, any employee benefit plan
of the Company or of any Subsidiary of the
Company, or any Person or entity organized,
18
22
appointed or established by the Company for or
pursuant to the terms of any such plan), alone
or together with its Affiliates and Associates,
shall, at any time after the Rights Dividend
Declaration Date, become the Beneficial Owner of
30% or more of the shares of Common Stock then
outstanding, other than pursuant to any transac-
tion set forth in Section 13(a) hereof, or
pursuant to an offer for all outstanding shares
of Common Stock at a price and upon such terms
and conditions as a majority of the Continuing
Directors determine to be in the best interests
of the Company and its stockholders, other than
such Person, its Affiliates and its Associates,
or
(B) during such time as there is
an Acquiring Person, there shall be any reclas-
sification of securities (including any reverse
stock split), or recapitalization of the Compa-
ny, or any merger or consolidation of the Compa-
ny with any of its Subsidiaries or any other
transaction or series of transactions involving
the Company or any of its Subsidiaries, other
than a transaction or transactions to which the
provisions of Section 13(a) apply (whether or
not with or into or otherwise involving an
Acquiring Person) which has the effect, directly
or indirectly, of increasing by more than 1% the
proportionate share of the outstanding shares of
any class of equity securities of the Company or
any of its Subsidiaries which is directly or
indirectly beneficially owned by any Acquiring
Person or any Associate or Affiliate of any
Acquiring Person,
then, promptly following the occurrence of a Section
11(a)(ii) Event, proper provision shall be made so that
each holder of a Right (except as provided below and in
Section 7(e) hereof) shall thereafter have the right to
receive, upon exercise thereof at the then current Purchase
Price in accordance with the terms of this Agreement, in
lieu of a number of one one-hundredths of a share of
Preferred Stock, such number of shares of Common Stock of
the Company as shall equal the result obtained by (x)
multiplying the then current Purchase Price by the then
19
23
number of one one-hundredths of a share of Preferred Stock
for which a Right was exercisable immediately prior to the
first occurrence of a Section 11(a)(ii) Event, and (y)
dividing that product (which, following such first occur-
rence, shall thereafter be referred to as the "Purchase
Price" for each Right and for all purposes of this Agree-
ment) by 50% of the current market price (determined
pursuant to Section 11(d) hereof) per share of Common Stock
on the date of such first occurrence (such number of
shares, the "Adjustment Shares").
(iii) In the event that the
number of shares of Common Stock which are
authorized by the Certificate of Incorporation
but not outstanding or reserved for issuance for
purposes other than upon exercise of the Rights
are not sufficient to permit the exercise in
full of the Rights in accordance with the fore-
going subparagraph (ii) of this Section 11(a),
the Company shall: (A) determine the excess of
(1) the value of the Adjustment Shares issuable
upon the exercise of a Right (the "Current
Value") over (2) the Purchase Price (such ex-
cess, the "Spread"), and (B) with respect to
each Right, make adequate provision to substi-
tute for the Adjustment Shares, upon payment of
the applicable Purchase Price, (1) cash, (2) a
reduction in the Purchase Price, (3) Common
Stock or other equity securities of the Company
(including, without limitation, shares, or units
of shares, of preferred stock which the Board of
Directors of the Company has deemed to have the
same value as shares of Common Stock (such
shares of preferred stock, "common stock equiva-
lents")), (4) debt securities of the Company,
(5) other assets, or (6) any combination of the
foregoing, having an aggregate value equal to
the Current Value, where such aggregate value
has been determined by the Board of Directors of
the Company based upon the advice of a national-
ly recognized investment banking firm selected
by the Board of Directors of the Company; pro-
----
vided, however, if the Company shall not have
-----
made adequate provision to deliver value pursu-
ant to clause (B) above within thirty (30) days
following the later of (x) the first occurrence
of a Section 11(a)(ii) Event and (y) the date on
20
24
which the Company's right of redemption pursuant
to Section 23(a) expires (the later of (x) and
(y) being referred to herein as the "Section
11(a)(ii) Trigger Date"), then the Company shall
be obligated to deliver, upon the surrender for
exercise of a Right and without requiring pay-
ment of the Purchase Price, shares of Common
Stock (to the extent available) and then, if
necessary, cash, which shares and/or cash have
an aggregate value equal to the Spread. If the
Board of Directors of the Company shall deter-
mine in good faith that it is likely that suffi-
cient additional shares of Common Stock could be
authorized for issuance upon exercise in full of
the Rights, 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 shareholder approval for
the authorization of such additional shares
(such period, as it may be extended, the "Sub-
stitution Period"). To the extent that the
Company determines that some action need be
taken pursuant to the first and/or second sen-
tences of this Section 11(a)(iii), the Company
(x) shall provide, subject to Section 7(e)
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 distri-
bution to be made pursuant to such first sen-
tence 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 tempo-
rarily suspended, as well as a public announce-
ment at such time as the suspension is no longer
in effect. For purposes of this Section -
11(a)(iii), the value of the Common Stock shall
be the current market price (as determined
pursuant to Section 11(d) hereof) per share of
the Common Stock on the Section 11(a)(ii) Trig-
ger Date and the value of any "common stock
equivalent" shall be deemed to have the same
value as the Common Stock on such date.
21
25
(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 to subscribe for
or purchase (for a period expiring within forty-five (45)
calendar days after such record date) Preferred Stock (or
shares having the same rights, privileges and preferences
as the shares of Preferred Stock ("equivalent preferred
stock")) or securities convertible into Preferred Stock or
equivalent preferred stock at a price per share of Pre-
ferred Stock or per share of equivalent preferred stock (or
having a conversion price per share, if a security convert-
ible into Preferred Stock or equivalent preferred stock)
less than the current market price (as determined pursuant
to Section 11(d) hereof) per share of Preferred Stock 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 outstanding on such
record date, plus the number of shares of Preferred Stock
which the aggregate offering price of the total number of
shares of Preferred Stock and/or equivalent preferred stock
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
outstanding on such record date, plus the number of
additional shares of Preferred Stock and/or equivalent
preferred stock to be offered for subscription or purchase
(or into which the convertible securities so to be offered
are initially convertible). In case such subscription
price may be paid by delivery of consideration part or all
of which may 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 and shall be binding on the Rights Agent and the
holders of the Rights. Shares of Preferred Stock 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 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.
22
26
(c) In case the Company shall fix a record
date for a distribution to all holders of Preferred Stock
(including any such distribution made in connection with a
consolidation or merger in which the Company is the
continuing corporation) of evidences of indebtedness, cash
(other than a regular quarterly cash dividend out of the
earnings or retained earnings of the Company), assets
(other than a dividend payable in Preferred Stock, but
including any dividend payable in stock other than Pre-
ferred 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 current market price (as
determined pursuant to Section 11(d) hereof) per share of
Preferred Stock on such record date, less the fair market
value (as determined in good faith by the Board of Direc-
tors of the Company, whose determination shall be described
in a statement filed with the Rights Agent) of the portion
of the cash, assets or evidences of indebtedness so to be
distributed or of such subscription rights or warrants
applicable to a share of Preferred Stock and the denomina-
tor of which shall be such current market price (as
determined pursuant to Section 11(d) hereof) per share of
Preferred Stock. Such adjustments shall be made succes-
sively whenever such a record date is fixed, and in the
event that such distribution is not so made, the Purchase
Price shall be adjusted to be the Purchase Price which
would have been in effect if such record date had not been
fixed.
(d)(i) For the purpose of any compu-
tation hereunder, other than computations made
pursuant to Section 11(a)(iii) hereof, the
"current market price" per share of Common Stock
on any date shall be deemed to be the average of
the daily closing prices per share of such
Common Stock for the thirty (30) consecutive
Trading Days (as such term is hereinafter de-
fined) immediately prior to such date, and for
purposes of computations made pursuant to Sec-
tion 11(a)(iii) hereof, the "current market
price" per share of Common Stock on any date
shall be deemed to be the average of the daily
closing prices per share of such Common Stock
for the ten (10) consecutive Trading Days imme-
23
27
diately following such date; provided, however,
--------
that in the event that the current market price
per share of the Common Stock is determined
during a period following the announcement by
the issuer of such Common Stock of (A) a divi-
dend or distribution on such Common Stock pay-
able in shares of such Common Stock or secu-
rities convertible into shares of such Common
Stock (other than the Rights), or (B) any subdi-
vision, combination or reclassification of such
Common Stock, and prior to the expiration of the
requisite thirty (30) Trading Day or ten (10)
Trading Day period, as set forth above, after
the ex-dividend date for such dividend or dis-
tribution, or the record date for such subdivi-
sion, combination or reclassification, then, and
in each such case, the "current market price"
shall be properly adjusted to take into account
ex-dividend trading. The closing price for each
day shall be the last sale price, regular way,
or, in case no such sale takes place on such
day, the average of the closing bid and asked
prices, regular way, in either case as reported
in the principal consolidated transaction re-
porting system with respect to securities listed
or admitted to trading on the New York Stock
Exchange or, if the shares of Common Stock are
not listed or admitted to trading on the New
York Stock Exchange, as reported in the princi-
pal consolidated transaction reporting system
with respect to securities listed on the princi-
pal national securities exchange on which the
shares of Common Stock are listed or admitted to
trading or, if the shares of Common Stock are
not listed or admitted to trading on any nation-
al 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 the National Association
of Securities Dealers, Inc. Automated Quotation
System ("NASDAQ") or such other system then in
use, or, if on any such date the shares of
Common Stock are not quoted by any such organi-
zation, the average of the closing bid and asked
prices as furnished by a professional market
maker making a market in the Common Stock se-
lected by the Board of Directors of the Company.
24
28
If on any such date no market maker is making a
market in the Common Stock, the fair value of
such shares on such date as determined in good
faith by the Board of Directors of the Company
shall be used. The term "Trading Day" shall
mean a day on which the principal national
securities exchange on which the shares of
Common Stock are listed or admitted to trading
is open for the transaction of business or, if
the shares of Common Stock are not listed or
admitted to trading on any national securities
exchange, a Business Day. If the Common Stock
is not publicly held or not so listed or traded,
"current market price" per share shall mean the
fair value per share as 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 and shall be conclu-
sive for all purposes.
(ii) For the purpose of any
computation hereunder, the "current market
price" per share of Preferred Stock shall be
determined in the same manner as set forth above
for the Common Stock in clause (i) of this
Section 11(d) (other than the last sentence
thereof). If the current market price per share
of Preferred Stock cannot be determined in the
manner provided above or if the Preferred Stock
is not publicly held or listed or traded in a
manner described in clause (i) of this Section
11(d), the "current market price" per share of
Preferred Stock shall be conclusively deemed to
be an amount equal to 100 (as such number may be
appropriately adjusted for such events as stock
splits, stock dividends and recapitalizations
with respect to the Common Stock occurring after
the date of this Agreement) multiplied by the
current market price per share of the Common
Stock. If neither the Common Stock nor the Pre-
ferred Stock is publicly held or so listed or
traded, "current market price" per share of the
Preferred Stock 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 and shall be conclusive for all
25
29
purposes. For all purposes of this Agreement,
the "current market price" of one one-hundredth
of a share of Preferred Stock shall be equal to
the "current market price" of one share of
Preferred Stock divided by 100.
(e) Anything herein to the contrary
notwithstanding, no adjustment in the Purchase Price shall
be required unless such adjustment would require an
increase or decrease of at least one percent (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 ten-thousandth of a share of Common Stock or other
share or one-millionth of a share of Preferred Stock, 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 (3)
years from the date of the transaction which mandates such
adjustment, or (ii) the Expiration Date.
(f) If as a result of an adjustment made
pursuant to Section 11(a)(ii) or Section 13(a) hereof, the
holder of any Right thereafter exercised shall become
entitled to receive any shares of capital stock other than
Preferred Stock, thereafter the number of such other shares
so receivable upon exercise of any Right and the Purchase
Price thereof shall be subject to adjustment from time to
time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the Preferred
Stock contained in Sections 11(a), (b), (c), (e), (g), (h),
(i), (j), (k) and (m), 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-hun-
dredths 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
26
30
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-
hundredths of a share of Preferred Stock (calculated to the
nearest one-millionth) obtained by (i) multiplying (x) the
number of one one-hundredths of a share covered by a Right
immediately prior to this adjustment, by (y) the Purchase
Price in effect immediately prior to such adjustment of the
Purchase Price, and (ii) dividing the product so obtained
by the Purchase Price in effect immediately after such
adjustment of the Purchase Price.
(i) The Company may elect on or after the
date of any adjustment of the Purchase Price to adjust the
number of Rights, in lieu of any adjustment in the number
of one one-hundredths of a share of Preferred Stock
purchasable upon the exercise of a Right. Each of the
Rights outstanding after the adjustment in the number of
Rights shall be exercisable for the number of one one-
hundredths 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-ten-thousandth) obtained by dividing the
Purchase Price in effect immediately prior to adjustment of
the Purchase Price by the Purchase Price in effect immedi-
ately 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 Rights Certificates have been issued, shall be
at least ten (10) days later than the date of the public
announcement. If Rights Certificates have been issued,
upon each adjustment of the number of Rights pursuant to
this Section 11(i), the Company shall, as promptly as
practicable, cause to be distributed to holders of record
of Rights Certificates on such record date Rights Certifi-
cates 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 Rights
Certificates held by such holders prior to the date of
27
31
adjustment, and upon surrender thereof, if required by the
Company, new Rights Certificates evidencing all the Rights
to which such holders shall be entitled after such adjust-
ment. Rights Certificates so to be distributed shall be
issued, executed and countersigned in the manner provided
for herein (and may bear, at the option of the Company, the
adjusted Purchase Price) and shall be registered in the
names of the holders of record of Rights 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-
hundredths of a share of Preferred Stock issuable upon the
exercise of the Rights, the Rights Certificates theretofore
and thereafter issued may continue to express the Purchase
Price per one one-hundredth of a share and the number of
one one-hundredth of a share which were expressed in the
initial Rights Certificates issued hereunder.
(k) Before taking any action that would
cause an adjustment reducing the Purchase Price below the
then stated value, if any, of the number of one one-
hundredths of a share of Preferred Stock issuable upon
exercise of the Rights, the Company shall take any corpo-
rate 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 such number of one one-
hundredths of a share of Preferred Stock at such adjusted
Purchase Price.
(l) In any case in which this Section 11
shall require that an adjustment in the Purchase Price be
made effective as of a record date for a specified event,
the Company may elect to defer until the occurrence of such
event the issuance to the holder of any Right exercised
after such record date the number of one one-hundredths of
a share of Preferred Stock and other capital stock or
securities of the Company, if any, issuable upon such
exercise over and above the number of one one-hundredths of
a share of 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 appropri-
ate instrument evidencing such holder's right to receive
such additional shares (fractional or otherwise) or
28
32
securities upon the occurrence of the event requiring such
adjustment.
(m) Anything in this Section 11 to the
contrary notwithstanding, the Company shall be entitled to
make such reductions in the Purchase Price, in addition to
those adjustments expressly required by this Section 11, as
and to the extent that in their good faith judgment the
Board of Directors of the Company shall determine to be
advisable in order that any (i) consolidation or subdivi-
sion of the Preferred Stock, (ii) issuance wholly for cash
of any shares of Preferred Stock at less than the current
market price, (iii) issuance wholly for cash of shares of
Preferred Stock or securities which by their terms are
convertible into or exchangeable for shares of Preferred
Stock, (iv) stock dividends or (v) issuance of rights,
options or warrants referred to in this Section 11,
hereafter made by the Company to holders of its Preferred
Stock shall not be taxable to such shareholders.
(n) The Company covenants and agrees that
it shall not, at any time after the Distribution Date, (i)
consolidate with any other Person (other than a Subsidiary
of the Company in a transaction which complies with Section
11(o) hereof), (ii) merge with or into any other Person
(other than a Subsidiary of the Company in a transaction
which complies with Section 11(o) hereof), or (iii) sell or
transfer (or permit any Subsidiary to sell or transfer), in
one transaction, or a series of related transactions,
assets or earning power aggregating more than 50% of the
assets or earning power of the Company and its Subsidiaries
(taken as a whole) to any other Person or Persons (other
than the Company and/or any of its Subsidiaries in one or
more transactions each of which complies with Section 11(o)
hereof), if (x) at the time of or immediately after such
consolidation, merger or sale 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 or (y) prior to, simultaneously with or immedi-
ately after such consolidation, merger or sale, the
shareholders of the Person who constitutes, or would
constitute, the "Principal Party" for purposes of Section
13(a) hereof shall have received a distribution of Rights
previously owned by such Person or any of its Affiliates
and Associates.
29
33
(o) The Company covenants and agrees that,
after the Distribution Date, it will not, except as
permitted by Section 23 or Section 26 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 otherwise eliminate
the benefits intended to be afforded by the Rights.
(p) Anything in this Agreement to the
contrary notwithstanding, in the event that the Company
shall at any time after the Rights Dividend Declaration
Date and prior to the Distribution Date (i) declare a
dividend on the outstanding shares of Common Stock payable
in shares of Common Stock, (ii) subdivide the outstanding
shares of Common Stock, or (iii) combine the outstanding
shares of Common Stock into a smaller number of shares, the
number of Rights associated with each share of Common Stock
then outstanding, or issued or delivered thereafter but
prior to the Distribution Date, 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
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.
Section 12. Certificate of Adjusted Purchase
--------------------------------
Price or Number of Shares. Whenever an adjustment is made
-------------------------
as provided in Section 11 and Section 13 hereof, the
Company shall (a) promptly prepare a certificate setting
forth such adjustment and a brief statement of the facts
accounting for such adjustment, (b) promptly file with the
Rights Agent, and with each transfer agent for the Pre-
ferred Stock and the Common Stock, a copy of such certifi-
cate, and (c) mail a brief summary thereof to each holder
of a Rights Certificate (or, if prior to the Distribution
Date, to each holder of a certificate representing shares
of Common Stock) in accordance with Section 25 hereof. The
Rights Agent shall be fully protected in relying on any
such certificate and on any adjustment therein contained.
30
34
Section 13. Consolidation, Merger or Sale or
--------------------------------
Transfer of Assets or Earning Power.
-----------------------------------
(a) In the event that, following the Stock
Acquisition Date, directly or indirectly, (x) the Company
shall consolidate with, or merge with and into, any other
Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) hereof), and
the Company shall not be the continuing or surviving
corporation of such consolidation or merger, (y) any Person
(other than a Subsidiary of the Company in a transaction
which complies with Section 11(o) hereof) shall consolidate
with, or merge with or into, the Company, and the Company
shall be the continuing or surviving corporation of such
consolidation or merger and, in connection with such
consolidation or merger, all or part of the outstanding
shares of Common Stock shall be changed into or exchanged
for stock or other securities of any other Person or cash
or any other property, or (z) the Company shall sell or
otherwise transfer (or one or more of its Subsidiaries
shall sell or otherwise transfer), in one transaction or a
series of related transactions, assets or earning power
aggregating more than 50% of the assets or earning power of
the Company and its Subsidiaries (taken as a whole) to any
Person or Persons (other than the Company or any Subsidiary
of the Company in one or more transactions each of which
complies with Section 11(o) hereof), then, and in each such
case, proper provision shall be made so that: (i) each
holder of a Right, except as provided in Section 7(e)
hereof, shall thereafter have the right to receive, upon
the exercise thereof at the then current Purchase Price in
accordance with the terms of this Agreement, such number of
validly authorized and issued, fully paid, nonassessable
and freely tradeable shares of Common Stock of the Princi-
pal Party (as such term is hereinafter defined), not
subject to any liens, encumbrances, rights of first refusal
or other adverse claims, as shall be equal to the result
obtained by (1) multiplying the then current Purchase Price
by the number of one one-hundredths of a share of Preferred
Stock for which a Right is exercisable immediately prior to
the first occurrence of a Section 13 Event (or, if a
Section 11(a)(ii) Event has occurred prior to the first
occurrence of a Section 13 Event, multiplying the number of
such one one-hundredths of a share for which a Right was
exercisable immediately prior to the first occurrence of a
Section 11(a)(ii) Event by the Purchase Price in effect
immediately prior to such first occurrence), and dividing
31
35
that product (which, following the first occurrence of a
Section 13 Event, shall be referred to as the "Purchase
Price" for each Right and for all purposes of this Agree-
ment) by (2) 50% of the current market price (determined
pursuant to Section 11(d)(i) hereof) per share of the
Common Stock of such Principal Party on the date of
consummation of such Section 13 Event; (ii) such Principal
Party shall thereafter be liable for, and shall assume, by
virtue of such Section 13 Event, all the obligations and
duties of the Company pursuant to this Agreement; (iii) the
term "Company" shall thereafter be deemed to refer to such
Principal Party, it being specifically intended that the
provisions of Section 11 hereof shall apply only to such
Principal Party following the first occurrence of a Section
13 Event; (iv) such Principal Party shall take such steps
(including, but not limited to, the reservation of a
sufficient number of shares of its Common Stock) in connec-
tion with the 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 its shares of Common Stock thereafter
deliverable upon the exercise of the Rights; and (v) the
provisions of Section 11(a)(ii) hereof shall be of no
effect following the first occurrence of any Section 13
Event.
(b) "Principal Party" shall mean
(i) in the case of any transac-
tion described in clause (x) or (y) of the first
sentence of Section 13(a), the Person that is
the issuer of any securities into which shares
of Common Stock of the Company are converted in
such merger or consolidation, and if no securi-
ties are so issued, the Person that is the other
party to such merger or consolidation; and
(ii) in the case of any transac-
tion described in clause (z) of the first sen-
tence of Section 13(a), the Person that is the
party receiving the greatest portion of the
assets or earning power transferred pursuant to
such transaction or transactions;
provided, however, that in any such case, (1) if the Common
--------
Stock of such Person is not at such time and has not been
continuously over the preceding twelve (12) month period
32
36
registered under Section 12 of the Exchange Act, and such
Person is a direct or indirect Subsidiary of another Person
the Common Stock of which is and has been so registered,
"Principal Party" shall refer to such other Person; and (2)
in case such Person is a Subsidiary, directly or indirect-
ly, of more than one Person, the Common Stocks of two or
more of which are and have been so registered, "Principal
Party" shall refer to whichever of such Persons is the
issuer of the Common Stock having the greatest aggregate
market value.
(c) The Company shall not consummate any
such consolidation, merger, sale or transfer unless the
Principal Party shall have a sufficient number of autho-
rized shares of its Common Stock which have not been issued
or reserved for issuance to permit the exercise in full of
the Rights in accordance with this Section 13 and unless
prior thereto the Company and such Principal Party shall
have executed and delivered to the Rights Agent a supple-
mental agreement providing for the terms set forth in
paragraphs (a) and (b) of this Section 13 and further
providing that, as soon as practicable after the date of
any consolidation, merger or sale of assets mentioned in
paragraph (a) of this Section 13, the Principal Party will
(i) prepare and file a registration statement
under the Act, with respect to the Rights and
the securities purchasable upon exercise of the
Rights on an appropriate form, and will use its
best efforts to cause such registration state-
ment to (A) become effective as soon as practi-
cable after such filing and (B) remain effective
(with a prospectus at all times meeting the
requirements of the Act) until the Expiration
Date; and
(ii) will deliver to holders of
the Rights historical financial statements for
the Principal Party and each of its Affiliates
which comply in all respects with the require-
ments for registration on Form 10 under the
Exchange Act.
The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other
transfers. In the event that a Section 13 Event shall
occur at any time after the occurrence of a Section
33
37
11(a)(ii) Event, the Rights which have not theretofore been
exercised shall thereafter become exercisable in the manner
described in Section 13(a).
Section 14. Fractional Rights and Fractional
--------------------------------
Shares.
------
(a) The Company shall not be required to
issue fractions of Rights, except prior to the Distribution
Date as provided in Section 11(p) hereof, or to distribute
Rights Certificates which evidence fractional Rights. In
lieu of such fractional Rights, there shall be paid to the
registered holders of the Rights Certificates with regard
to which such fractional Rights would otherwise be issu-
able, an amount in cash equal to the same fraction of the
current market value of a whole Right. For 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 of the Rights 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 report-
ing 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.
34
38
(b) The Company shall not be required to
issue fractions of shares of Preferred Stock (other than
fractions which are integral multiples of one one-hundredth
of a share of Preferred Stock) upon exercise of the Rights
or to distribute certificates which evidence fractional
shares of Preferred Stock (other than fractions which are
integral multiples of one one-hundredth of a share of
Preferred Stock). In lieu of fractional shares of Pre-
ferred Stock that are not integral multiples of one one-
hundredth of a share of Preferred Stock, the Company may
pay to the registered holders of Rights Certificates at the
time such Rights are exercised as herein provided an amount
in cash equal to the same fraction of the current market
value of one one-hundredth of a share of Preferred Stock.
For purposes of this Section 14(b), the current market
value of one one-hundredth of a share of Preferred Stock
shall be one one-hundredth of the closing price of a share
of Preferred Stock (as determined pursuant to Section
11(d)(ii) hereof) for the Trading Day immediately prior to
the date of such exercise.
(c) Following the occurrence of a Trigger-
ing Event, the Company shall not be required to issue
fractions of shares of Common Stock upon exercise of the
Rights or to distribute certificates which evidence
fractional shares of Common Stock. In lieu of fractional
shares of Common Stock, the Company may pay to the regis-
tered holders of Rights Certificates at the time such
Rights are exercised as herein provided an amount in cash
equal to the same fraction of the current market value of
one (1) share of Common Stock. For purposes of this
Section 14(c), the current market value of one share of
Common Stock shall be the closing price of one share of
Common Stock (as determined pursuant to Section 11(d)(i)
hereof) for the Trading Day immediately prior to the date
of such exercise.
(d) The holder of a Right by the acceptance
of the Rights expressly waives his right to receive any
fractional Rights or any fractional shares upon exercise of
a Right, except as permitted by this Section 14.
Section 15. Rights of Action. All rights of
----------------
action in respect of this Agreement are vested in the
respective registered holders of the Rights Certificates
(and, prior to the Distribution Date, the registered
holders of the Common Stock); and any registered holder of
35
39
any Rights 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 Rights Certificate (or,
prior to the Distribution Date, of the Common Stock), may,
in his own behalf and for his own benefit, enforce, and may
institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect
of, his right to exercise the Rights evidenced by such
Rights Certificate in the manner provided in such Rights
Certificate and in this Agreement. Without limiting the
foregoing or any remedies available to the holders of
Rights, it is specifically acknowledged that the holders of
Rights would not have an adequate remedy at law for any
breach of this Agreement and shall be entitled to specific
performance of the obligations hereunder and injunctive
relief against actual or threatened violations of the
obligations hereunder of any Person subject to this
Agreement.
Section 16. Agreement of Rights Holders. Every
---------------------------
holder of a Right by accepting the same consents and agrees
with the Company and the Rights Agent and with every other
holder of a Right that:
(a) prior to the Distribution Date, the
Rights will be transferable only in connection with the
transfer of Common Stock;
(b) after the Distribution Date, the Rights
Certificates are transferable only on the registry books of
the Rights Agent if surrendered at the principal office or
offices of the Rights Agent designated for such purposes,
duly endorsed or accompanied by a proper instrument of
transfer and with the appropriate forms and certificates
fully executed;
(c) subject to Section 6(a) and Section
7(f) hereof, the Company and the Rights Agent may deem and
treat the person in whose name a Rights Certificate (or,
prior to the Distribution Date, the associated 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 Rights Certifi-
cates or the associated Common Stock certificate made by
anyone other than the Company or the Rights Agent) for all
purposes whatsoever, and neither the Company nor the Rights
Agent, subject to the last sentence of Section 7(e) hereof,
36
40
shall be required to be affected by any notice to the
contrary; and
(d) notwithstanding anything in this Agree-
ment to the contrary, neither the Company nor the Rights
Agent shall have any liability to any holder of a Right or
other Person as a result of its inability to perform any of
its obligations under this Agreement by reason of any
preliminary or permanent injunction or other order, decree
or ruling issued by a court of competent jurisdiction or by
a governmental, regulatory or administrative agency or
commission, or any statute, rule, regulation or executive
order promulgated or enacted by any governmental authority,
prohibiting or otherwise restraining performance of such
obligation; provided, however, the Company must use its
--------
best efforts to have any such order, decree or ruling
lifted or otherwise overturned as soon as possible.
Section 17. Rights Certificate Holder Not Deemed
------------------------------------
a Stockholder. No holder, as such, of any Rights Certifi-
-------------
cate shall be entitled to vote, receive dividends or be
deemed for any purpose the holder of the number of one one-
hundredths of a share of Preferred Stock or any other
securities of the Company which may at any time be issuable
on the exercise of the Rights represented thereby, nor
shall anything contained herein or in any Rights Certifi-
cate be construed to confer upon the holder of any Rights
Certificate, as such, any of the rights of a stockholder of
the Company or any right to vote for the election of
directors or upon any matter submitted to stockholders at
any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other
actions affecting stockholders (except as provided in
Section 24 hereof), or to receive dividends or subscription
rights, or otherwise, until the Right or Rights evidenced
by such Rights Certificate shall have been exercised in
accordance with the provisions hereof.
Section 18. Concerning the Rights Agent.
---------------------------
(a) The Company agrees to pay to the Rights
Agent reasonable compensation for all services rendered by
it hereunder and, from time to time, on demand of the
Rights Agent, its reasonable expenses and counsel fees and
disbursements and other disbursements incurred in the
administration and execution of this Agreement and the
exercise and performance of its duties hereunder. The
37
41
Company also agrees to indemnify the Rights Agent for, and
to hold it harmless against, any loss, liability, or
expense, incurred without negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything
done or omitted by the Rights Agent in connection with the
acceptance and administration of this Agreement, including
the costs and expenses of defending against any claim of
liability in the premises.
(b) The Rights Agent shall be protected and
shall incur no liability for or in respect of any action
taken, suffered or omitted by it in connection with its
administration of this Agreement in reliance upon any
Rights Certificate or certificate for Common Stock or for
other securities of the Company, instrument of assignment
or transfer, power of attorney, endorsement, affidavit,
letter, notice, direction, consent, certificate, statement,
or other paper or document believed by it to be genuine and
to be signed, executed and, where necessary, verified or
acknowledged, by the proper Person or Persons.
Section 19. Merger or Consolidation or Change of
------------------------------------
Name of Rights Agent.
--------------------
(a) Any corporation into which the Rights
Agent or any successor Rights Agent may be merged or with
which it may be consolidated, or any corporation resulting
from any merger or consolidation to which the Rights Agent
or any successor Rights Agent shall be a party, or any
corporation succeeding to the corporate trust business of
the Rights Agent or any successor Rights Agent, shall be
the successor to the Rights Agent under this Agreement
without the execution or filing of any paper or any further
act on the part of any of the parties hereto; provided,
however, that such corporation would be eligible for
appointment as a successor Rights Agent under the provi-
sions of Section 21 hereof. In case at the time such
successor Rights Agent shall succeed to the agency created
by this Agreement, any of the Rights Certificates shall
have been countersigned but not delivered, any such
successor Rights Agent may adopt the countersignature of a
predecessor Rights Agent and deliver such Rights Certifi-
cates so countersigned; and in case at that time any of the
Rights Certificates shall not have been countersigned, any
successor Rights Agent may countersign such Rights Certifi-
cates either in the name of the predecessor or in the name
of the successor Rights Agent; and in all such cases such
38
42
Rights Certificates shall have the full force provided in
the Rights Certificates and in this Agreement.
(b) In case at any time the name of the
Rights Agent shall be changed and at such time any of the
Rights Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the countersignature
under its prior name and deliver Rights Certificates so
countersigned; and in case at that time any of the Rights
Certificates shall not have been countersigned, the Rights
Agent may countersign such Rights Certificates either in
its prior name or in its changed name; and in all such
cases such Rights Certificates shall have the full force
provided in the Rights Certificates and in this Agreement.
Section 20. Duties of Rights Agent. The Rights
----------------------
Agent undertakes the duties and obligations imposed by this
Agreement upon the following terms and conditions, by all
of which the Company and the holders of Rights Certifi-
cates, 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 authori-
zation and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with
such opinion.
(b) Whenever in the performance of its
duties under this Agreement the Rights Agent shall deem it
necessary or desirable that any fact or matter (including,
without limitation, the identity of any Acquiring Person
and the determination of "current market price") be proved
or established by the Company prior to taking or suffering
any action hereunder, such fact or matter (unless other
evidence in respect thereof be herein specifically pre-
scribed) may be deemed to be conclusively proved and
established by a certificate signed by the Chairman of the
Board, the President, any Vice President, the Treasurer,
any Assistant Treasurer, the Secretary or any Assistant
Secretary of the Company and delivered to the Rights Agent;
and such certificate shall be full authorization to the
Rights Agent for any action taken or suffered in good faith
by it under the provisions of this Agreement in reliance
upon such certificate.
39
43
(c) The Rights Agent shall be liable
hereunder only for its own negligence, bad faith or willful
misconduct.
(d) The Rights Agent shall not be liable
for or by reason of any of the statements of fact or
recitals contained in this Agreement or in the Rights
Certificates or be required to verify the same (except as
to its countersignature on such Rights Certificates), but
all such statements and recitals are and shall be deemed to
have been made by the Company only.
(e) The Rights Agent shall not be under any
responsibility in respect of the validity of this Agreement
or the execution and delivery hereof (except the due
execution hereof by the Rights Agent) or in respect of the
validity or execution of any Rights Certificate (except its
countersignature thereof); nor shall it be responsible for
any breach by the Company of any covenant or condition con-
tained in this Agreement or in any Rights Certificate; nor
shall it be responsible for any adjustment required under
the provisions of Section 11 or Section 13 hereof or
responsible for the manner, method or amount of any such
adjustment or the ascertaining of the existence of facts
that would require any such adjustment (except with respect
to the exercise of Rights evidenced by Rights Certificates
after actual notice of any such adjustment); nor shall it
by any act hereunder be deemed to make any representation
or warranty as to the authorization or reservation of any
shares of Common Stock or Preferred Stock to be issued
pursuant to this Agreement or any Rights Certificate or as
to whether any shares of Common Stock or Preferred Stock
will, when so issued, be validly authorized and issued,
fully paid and nonassessable.
(f) The Company agrees that it will
perform, execute, acknowledge and deliver or cause to be
performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may
reasonably be required by the Rights Agent for the carrying
out or performing by the Rights Agent of the provisions of
this Agreement.
(g) The Rights Agent is hereby authorized
and directed to accept instructions with respect to the
performance of its duties hereunder from the Chairman of
the Board, the President, any Vice President, the Secre-
40
44
tary, any Assistant Secretary, the Treasurer or any
Assistant Treasurer of the Company, and to apply to such
officers for advice or instructions in connection with its
duties, and it shall not be liable for any action taken or
suffered to be taken by it in good faith in accordance with
instructions of any such officer.
(h) The Rights Agent and any stockholder,
director, officer or employee of the Rights Agent may buy,
sell or deal in any of the Rights or other securities of
the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or
contract with or lend money to the Company or otherwise act
as fully and freely as though it were not Rights Agent
under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the
Company or for any other legal entity.
(i) The Rights Agent may execute and
exercise any of the rights or powers hereby vested in it or
perform any duty hereunder either itself or by or through
its 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, however, reasonable care
--------
was exercised in the selection and continued employment
thereof.
(j) No provision of this Agreement shall
require the Rights Agent to expend or risk its own funds or
otherwise incur any financial liability in the performance
of any of its duties hereunder or in the exercise of its
rights if there shall be reasonable grounds for believing
that repayment of such funds or adequate indemnification
against such risk or liability is not reasonably assured to
it.
(k) If, with respect to any Right Certifi-
cate surrendered to the Rights Agent for exercise or
transfer, the certificate attached to the form of assign-
ment or form of election to purchase, as the case may be,
has either not been completed or indicates an affirmative
response to clause 1 and/or 2 thereof, the Rights Agent
shall not take any further action with respect to such
requested exercise of transfer without first consulting
with the Company.
41
45
Section 21. Change of Rights Agent. The Rights
----------------------
Agent or any successor Rights Agent may resign and be
discharged from its duties under this Agreement upon thirty
(30) days' notice in writing mailed to the Company, and to
each transfer agent of the Common Stock and Preferred
Stock, by registered or certified mail, and to the holders
of the Rights Certificates by first-class mail. The
Company may remove the Rights Agent or any successor Rights
Agent upon thirty (30) days' notice in writing, mailed to
the Rights Agent or successor Rights Agent, as the case may
be, and to each transfer agent of the Common Stock and
Preferred Stock, by registered or certified mail, and to
the holders of the Rights Certificates by first-class mail.
If the Rights Agent shall resign or be removed or shall
otherwise become incapable of acting, the Company shall
appoint a successor to the Rights Agent. If the Company
shall fail to make such appointment within a period of
thirty (30) days after giving notice of such removal or
after it has been notified in writing of such resignation
or incapacity by the resigning or incapacitated Rights
Agent or by the holder of a Rights Certificate (who shall,
with such notice, submit his Rights Certificate for
inspection by the Company), then any registered holder of
any Rights Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent.
Any successor Rights Agent, whether appointed by the
Company or by such a court, shall be a corporation orga-
nized and doing business under the laws of the United
States or of the State of Missouri (or of any other state
of the United States so long as such corporation is
authorized to do business as a banking institution in the
State of Missouri), in good standing, having a principal
office in the State of Missouri, which is authorized under
such laws to exercise corporate trust powers and is subject
to supervision or examination by federal or state authority
and which has at the time of its appointment as Rights
Agent a combined capital and surplus of at least
$100,000,000. After appointment, the successor Rights
Agent shall be vested with the same powers, rights, duties
and responsibilities as if it had been originally named as
Rights Agent without further act or deed; but the predeces-
sor Rights Agent shall deliver and transfer to the succes-
sor 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
42
46
predecessor Rights Agent and each transfer agent of the
Common Stock and the Preferred Stock, and mail a notice
thereof in writing to the registered holders of the Rights
Certificates. Failure to give any notice provided for in
this Section 21, however, or any defect therein, shall not
affect the legality or validity of the resignation or
removal of the Rights Agent or the appointment of the
successor Rights Agent, as the case may be.
Section 22. Issuance of New Rights Certificates.
-----------------------------------
Notwithstanding any of the provisions of this Agreement or
of the Rights to the contrary, the Company may, at its
option, issue new Rights Certificates evidencing Rights in
such form as may be approved by its Board of Directors to
reflect any adjustment or change in the Purchase Price and
the number or kind or class of shares or other securities
or property purchasable under the Rights Certificates made
in accordance with the provisions of this Agreement. In
addition, in connection with the issuance or sale of shares
of Common Stock following the Distribution Date and prior
to the redemption or expiration of the Rights, the Company
(a) shall, with respect to shares of Common Stock so issued
or sold pursuant to the exercise of stock options or under
any employee plan or arrangement, or upon the exercise,
conversion or exchange of securities hereinafter issued by
the Company, and (b) may, in any other case, if deemed
necessary or appropriate by the Board of Directors of the
Company, issue Rights Certificates representing the
appropriate number of Rights in connection with such
issuance or sale; provided, however, that (i) no such
--------
Rights Certificate shall be issued if, and to the extent
that, the Company shall be advised by counsel that such
issuance would create a significant risk of material
adverse tax consequences to the Company or the Person to
whom such Rights Certificate would be issued, and (ii) no
such Rights Certificate shall be issued if, and to the
extent that, appropriate adjustment shall otherwise have
been made in lieu of the issuance thereof.
Section 23. Redemption and Termination.
--------------------------
(a) The Board of Directors of the Company
may, at its option, at any time prior to the earlier of (i)
the close of business on the tenth business day following
the Stock Acquisition Date or (ii) the Final Expiration
Date, redeem all but not less than all the then outstanding
Rights at a redemption price of $.01 per Right, as such
43
47
amount may be appropriately adjusted to reflect any stock
split, stock dividend or similar transaction occurring
after the date hereof (such redemption price being herein-
after referred to as the "Redemption Price"); provided,
--------
however, that if, following the occurrence of a Stock
Acquisition Date and following the expiration of the right
of redemption hereunder but prior to any Triggering Event,
(i) a Person who is an Acquiring Person shall have trans-
ferred or otherwise disposed of a number of shares of
Common Stock in one transaction or series of transactions,
not directly or indirectly involving the Company or any of
its Subsidiaries, which did not result in the occurrence of
a Triggering Event such that such Person is thereafter a
Beneficial Owner of 10% or less of the outstanding shares
of Common Stock, and (ii) there are no other Persons,
immediately following the occurrence of the event described
in clause (i), who are Acquiring Persons, then the right of
redemption shall be reinstated and thereafter be subject to
the provisions of this Section 23. Notwithstanding anything
contained in this Agreement to the contrary, the Rights
shall not be exercisable after the first occurrence of a
Section 11(a)(ii) Event until such time as the Company's
right of redemption hereunder has expired.
(b) Immediately upon the action of the
Board of Directors of the Company ordering the redemption
of the Rights, evidence of which shall have been filed with
the Rights Agent 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 for each Right so
held. Promptly after the action of the Board of Directors
ordering the redemption of the Rights, the Company shall
give notice of such redemption to the Rights Agent and the
holders of the then outstanding Rights by mailing such
notice to all such holders at each holder's last address as
it appears 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 will state the method by which
the payment of the Redemption Price will be made.
44
48
Section 24. Notice of Certain Events.
------------------------
(a) In case the Company shall propose, at
any time after the Distribution Date, (i) to pay any
dividend payable in stock of any class to the holders of
Preferred Stock or to make any other distribution to the
holders of Preferred Stock (other than a regular quarterly
cash dividend out of earnings or retained earnings of the
Company), or (ii) to offer to the holders of 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, or
(iii) to effect any reclassification of its Preferred Stock
(other than a reclassification involving only the subdivi-
sion of outstanding shares of Preferred Stock), or (iv) to
effect any consolidation or merger into or with any other
Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) hereof), or
to effect any sale or other transfer (or to permit one or
more of its Subsidiaries to effect any sale or other
transfer), in one transaction or a series of related
transactions, of more than 50% of the assets or earning
power of the Company and its Subsidiaries (taken as a
whole) to any other Person or Persons (other than the
Company and/or any of its Subsidiaries in one or more
transactions each of which complies with Section 11(o)
hereof), or (v) to effect the liquidation, dissolution or
winding up of the Company, then, in each such case, the
Company shall give to each holder of a Rights Certificate,
to the extent feasible and in accordance with Section 25
hereof, a notice of such proposed action, which shall
specify the record date for the purposes of such stock
dividend, distribution of rights or warrants, or the date
on which such reclassification, consolidation, merger,
sale, transfer, liquidation, dissolution, or winding up is
to take place and the date of participation therein by the
holders of the shares of 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 twenty (20) days prior to the record date for
determining holders of the shares of Preferred Stock for
purposes of such action, and in the case of any such other
action, at least twenty (20) days prior to the date of the
taking of such proposed action or the date of participation
therein by the holders of the shares of Preferred Stock
whichever shall be the earlier.
45
49
(b) In case any of the events set forth in
Section 11(a)(ii) hereof shall occur, then, in any such
case, (i) the Company shall as soon as practicable thereaf-
ter give to each holder of a Rights Certificate, to the
extent feasible and in accordance with Section 25 hereof,
a notice of the occurrence of such event, which shall
specify the event and the consequences of the event to
holders of Rights under Section 11(a)(ii) hereof, and (ii)
all references in the preceding paragraph to Preferred
Stock shall be deemed thereafter to refer to Common Stock
and/or, if appropriate, other securities.
Section 25. Notices. Notices or demands autho-
-------
rized by this Agreement to be given or made by the Rights
Agent or by the holder of any Rights 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:
Anheuser-Busch Companies, Inc.
One Busch Place
St. Louis, Missouri 63118-1852
Attention: Corporate Secretary
Subject to the provisions of Section 21, any notice or
demand authorized by this Agreement to be given or made by
the Company or by the holder of any Rights 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:
Boatmen's Trust Company
510 Locust Street
St. Louis, Missouri 63101
Attention: Corporate Trust Department
Notices or demands authorized by this Agreement to be given
or made by the Company or the Rights Agent to the holder of
any Rights Certificate (or, if prior to the Distribution
Date, to the holder of certificates representing shares of
Common Stock) 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.
46
50
Section 26. Supplements and Amendments. Prior
--------------------------
to the Distribution Date and subject to the penultimate
sentence of this Section 26, the Company and the Rights
Agent shall, if the Company so directs, supplement or amend
any provision of this Agreement without the approval of any
holders of certificates representing shares of Common
Stock. From and after the Distribution Date and subject to
the penultimate sentence of this Section 26, the Company
and the Rights Agent shall, if the Company so directs,
supplement or amend this Agreement without the approval of
any holders of Rights Certificates in order (i) to cure any
ambiguity, (ii) to correct or supplement any provision
contained herein which may be defective or inconsistent
with any other provisions herein, (iii) to shorten or
lengthen any time period hereunder, or (iv) to change or
supplement the provisions hereunder in any manner which the
Company may deem necessary or desirable and which shall not
adversely affect the interests of the holders of Rights
Certificates; provided, this Agreement may not be supple-
--------
mented or amended to lengthen, pursuant to clause (iii) of
this sentence, (A) a time period relating to when the
Rights may be redeemed at such time as the Rights are not
then redeemable, or (B) any other time period unless such
lengthening is for the purpose of protecting, enhancing or
clarifying the rights of, and/or the benefits to, the
holders of Rights. 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 26, the Rights Agent shall execute
such supplement or amendment. Notwithstanding anything
contained in this Agreement to the contrary, no supplement
or amendment shall be made which changes the Redemption
Price, the Final Expiration Date, the Purchase Price or the
number of one one-hundredths of a share of Preferred Stock
for which a Right is exercisable; provided, however, that
--------
at any time prior to (i) the existence of an Acquiring
Person or (ii) the date that a tender or exchange offer by
any Person (other than the Company, any Subsidiary of the
Company, any employee benefit plan of the Company or any
Subsidiary of the Company, or any Person or entity orga-
nized, appointed or established by the Company for or
pursuant to the terms of any such plan) is first published
or sent or given within the meaning of Rule 14d-2(a) of the
General Rules and Regulations under the Exchange Act, if
upon consummation thereof, such Person would be the
Beneficial Owner of 30% or more of the shares of Common
Stock then outstanding, the Board of Directors of the
47
51
Company may amend this Agreement to increase the Purchase
Price or extend the Final Expiration Date. Prior to the
Distribution Date, the interests of the holders of Rights
shall be deemed coincident with the interests of the
holders of Common Stock.
Section 27. 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 hereun-
der.
Section 28. Determinations and Actions by the
---------------------------------
Board of Directors, etc. For all purposes of this Agree-
-----------------------
ment, 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 Exchange Act. The Board of
Directors of the Company (with, where specifically provided
for herein, the concurrence of the Continuing Directors)
shall have the exclusive power and authority to administer
this Agreement and to exercise all rights and powers
specifically granted to the Board (with, where specifically
provided for herein, the concurrence of the Continuing
Directors) or to the Company, or as may be necessary or
advisable in the administration of this Agreement, includ-
ing, 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 a determination
to redeem or not redeem the Rights or to amend the Agree-
ment). All such actions, calculations, interpretations and
determinations (including, for purposes of clause (y)
below, all omissions with respect to the foregoing) which
are done or made by the Board (with, where specifically
provided for herein, the concurrence of the Continuing
Directors) in good faith, shall (x) be final, conclusive
and binding on the Company, the Rights Agent, the holders
of the Rights and all other parties, and (y) not subject
the Board or the Continuing Directors to any liability to
the holders of the Rights.
48
52
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 Rights Certificates (and, prior to the
Distribution Date, registered holders of 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 Rights Certificates (and, prior
to the Distribution Date, registered holders of the Common
Stock).
Section 30. Severability. If any term, provi-
------------
sion, 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; provided, however,
--------
that notwithstanding anything in this Agreement to the
contrary, if any such term, provision, covenant or restric-
tion is held by such court or authority to be invalid, void
or unenforceable and the Board of Directors of the Company
determines in its good faith judgment that severing the
invalid language from this Agreement would adversely affect
the purpose or effect of this Agreement, the right of
redemption set forth in Section 23 hereof shall be rein-
stated and shall not expire until the close of business on
the tenth day following the date of such determination by
the Board of Directors. Without limiting the foregoing, if
any provision requiring a majority of the Board of Direc-
tors of the Company to be Continuing Directors to act is
held by any court of competent jurisdiction or other
authority to be invalid, void or unenforceable, such
determination shall then be made by the Board of Directors
of the Company in accordance with applicable law and the
Company's Certificate of Incorporation and By-Laws.
Section 31. Governing Law. This Agreement, each
-------------
Right and each Rights 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 made and to be performed entirely
within such State.
49
53
Section 32. 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 consti-
tute but one and the same instrument.
Section 33. 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 and their
respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Attest: ANHEUSER-BUSCH COMPANIES, INC.
CORPORATE SEAL
By s/Laura Reeves By s/Ellis W. McCracken, Jr.
--------------------- -------------------------
Name: Laura Reeves Name: Ellis W. McCracken, Jr.
Title: Assistant Secretary Title: Vice President and
General Counsel
Attest: BOATMEN'S TRUST COMPANY
CORPORATE SEAL
By s/R. Clasquin By s/H.E. Bradford
--------------------- -----------------------
Name: R. Clasquin Name: H.E. Bradford
Title: Asst. Secretary Title: Senior Vice President
50
54
Exhibit A
[Form of Rights Certificate]
Certificate No. R- --------- Rights
NOT EXERCISABLE AFTER OCTOBER 31, 2004 OR EARLIER
IF REDEEMED BY THE COMPANY. THE RIGHTS ARE SUBJECT
TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT
$.01 PER RIGHT ON THE TERMS SET FORTH IN THE RIGHTS
AGREEMENT. UNDER CERTAIN CIRCUMSTANCES, RIGHTS
BENEFICIALLY OWNED BY AN ACQUIRING PERSON (AS SUCH
TERM IS DEFINED IN THE RIGHTS AGREEMENT) AND ANY
SUBSEQUENT HOLDER OF SUCH RIGHTS MAY BECOME NULL
AND VOID. [THE RIGHTS REPRESENTED BY THIS RIGHTS
CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A
PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN
AFFILIATE OR ASSOCIATE OF AN ACQUIRING PERSON (AS
SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT).
ACCORDINGLY, THIS RIGHTS CERTIFICATE AND THE RIGHTS
REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE
CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF SUCH
AGREEMENT.]1
Rights Certificate
ANHEUSER-BUSCH COMPANIES, 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 October 26, 1994 (the
---------------------
1 The portion of the legend in brackets shall be
inserted only if applicable and shall replace the
receding sentence.
55
"Rights Agreement"), between Anheuser-Busch Companies, Inc.,
a Delaware corporation (the "Company"), and Boatmen's Trust
Company, a trust company organized under the State of Missouri
(the "Rights Agent"), to purchase from the Company at any time
prior to 4:45 P.M. (St. Louis time) on October 31, 2004 at the
office or offices of the Rights Agent designated for such
purpose, or its successors as Rights Agent, one one-hundredth
of a fully paid, nonassessable share of Series B Junior
Participating Preferred Stock (the "Preferred Stock") of the
Company, at a purchase price of $195 per one one-hundredth of
a share (the "Purchase Price"), upon presentation and surren-
der of this Rights Certificate with the Form of Election to
Purchase and related Certificate duly executed. The Purchase
Price shall be paid, at the election of the holder, in cash or
shares of Common Stock of the Company having an equivalent
value. The number of Rights evidenced by this Rights Certifi-
cate (and the number of shares which may be purchased upon
exercise thereof) set forth above, and the Purchase Price per
share set forth above, are the number and Purchase Price as of
October 26, 1994, based on the Preferred Stock as constituted
at such date.
Upon the occurrence of a Section 11(a)(ii) Event (as
such term is defined in the Rights Agreement), if the Rights
evidenced by this Rights Certificate are beneficially owned by
(i) an Acquiring Person or an Affiliate or Associate of any
such Acquiring Person (as such terms are defined in the Rights
Agreement), (ii) a transferee of any such Acquiring Person,
Associate or Affiliate, or (iii) under certain circumstances
specified in the Rights Agreement, a transferee of a person
who, after such transfer, became an Acquiring Person, or an
Affiliate or Associate of an Acquiring Person, such Rights
shall become null and void and no holder hereof shall have any
right with respect to such Rights from and after the occur-
rence of such Section 11(a)(ii) Event.
As provided in the Rights Agreement, the Purchase
Price and the number and kind of shares of Preferred Stock or
other securities, which may be purchased upon the exercise of
the Rights evidenced by this Rights Certificate are subject to
modification and adjustment upon the happening of certain
events, including Triggering Events.
This Rights 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
A-2
56
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 Rights Certificates, which limitations of
rights include the temporary suspension of the exercisability
of such Rights under the specific circumstances set forth in
the Rights Agreement. Copies of the Rights Agreement are on
file at the above-mentioned office of the Rights Agent and are
also available upon written request to the Rights Agent.
This Rights Certificate, with or without other
Rights Certificates, upon surrender at the principal office or
offices of the Rights Agent designated for such purpose, may
be exchanged for another Rights Certificate or Rights Certifi-
cates of like tenor and date evidencing Rights entitling the
holder to purchase a like aggregate number of one one-hun-
dredths of a share of Preferred Stock as the Rights evidenced
by the Rights Certificate or Rights Certificates surrendered
shall have entitled such holder to purchase. If this Rights
Certificate shall be exercised in part, the holder shall be
entitled to receive upon surrender hereof another Rights
Certificate or Rights Certificates for the number of whole
Rights not exercised.
Subject to the provisions of the Rights Agreement,
the Rights evidenced by this Certificate may be redeemed by
the Company at its option at a redemption price of $.01 per
Right at any time prior to the earlier of the close of
business on (i) the tenth business day following the Stock
Acquisition Date (as such time period may be extended pursuant
to the Rights Agreement), and (ii) the Final Expiration Date.
After the expiration of the redemption period, the Company's
right of redemption may be reinstated if an Acquiring Person
reduces his beneficial ownership to 10% or less of the
outstanding shares of Common Stock in a transaction or series
of transactions not involving the Company.
No fractional shares of Preferred Stock will be
issued upon the exercise of any Right or Rights evidenced
hereby (other than fractions which are integral multiples of
one one-hundredth of a share of Preferred Stock, which may, at
the election of the Company, be evidenced by depositary
receipts), but in lieu thereof a cash payment will be made, as
provided in the Rights Agreement.
No holder of this Rights Certificate shall be
entitled to vote or receive dividends or be deemed for any
A-3
57
purpose the holder of shares of Preferred Stock or of any
other securities of the Company which may at any time be issu-
able on the exercise 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 shareholder of
the Company or any right to vote for the election of directors
or upon any matter submitted to shareholders at any meeting
thereof, or to give or withhold consent to any corporate
action, or, to receive notice of meetings or other actions
affecting shareholders (except as provided in the Rights
Agreement), or to receive dividends or subscription rights, or
otherwise, until the Right or Rights evidenced by this Rights
Certificate shall have been exercised as provided in the
Rights Agreement.
This Rights Certificate shall not be valid or
obligatory for any purpose until it shall have been counter-
signed by the Rights Agent.
WITNESS the facsimile signature of the proper
officers of the Company and its corporate seal.
Dated as of --------- --, ----
ATTEST: ANHEUSER-BUSCH COMPANIES, INC.
------------------------ By----------------------------
Secretary Title:
Countersigned:
BOATMEN'S TRUST COMPANY
By ---------------------------------
Authorized Signature
A-4
58
[Form of Reverse Side of Rights Certificate]
FORM OF ASSIGNMENT
------------------
(To be executed by the registered holder if such
holder desires to transfer the Rights Certificate.)
FOR VALUE RECEIVED -------------------------------------------
hereby sells, assigns and transfers unto ---------------------
--------------------------------------------------------------
(Please print name and address of transferee)
--------------------------------------------------------------
this Rights Certificate, together with all right, title and
interest therein, and does hereby irrevocably constitute and
appoint ---------------- Attorney, to transfer the within
Rights Certificate on the books of the within-named Company,
with full power of substitution.
Date: -------------------, ----
-----------------------------
Signature
Signature Guaranteed:
Certificate
-----------
The undersigned hereby certifies by checking the
appropriate boxes that:
(1) this Rights Certificate [ ] is [ ] is not being
sold, assigned and transferred by or on behalf of a Person who
is or was an Acquiring Person or an Affiliate or Associate of
any such Acquiring Person (as such terms are defined pursuant
to the Rights Agreement); and
(2) after due inquiry and to the best knowledge of
the undersigned, it [ ] did [ ] did not acquire the Rights
evidenced by this Rights Certificate from any Person who is,
A-5
59
was or subsequently became an Acquiring Person or an Affiliate
or Associate of an Acquiring Person.
Dated: -----------, ---- -------------------
Signature
Signature Guaranteed:
NOTICE
------
The signature to the foregoing Assignment and Cer-
tificate must correspond to the name as written upon the face
of this Rights Certificate in every particular, without
alteration or enlargement or any change whatsoever.
A-6
60
FORM OF ELECTION TO PURCHASE
----------------------------
(To be executed if holder desires to
exercise Rights represented by the
Rights Certificate.)
To: ANHEUSER-BUSCH COMPANIES, INC.:
The undersigned hereby irrevocably elects to exer-
cise ---------- Rights represented by this Rights Certificate
to purchase the shares of Preferred Stock issuable upon the
exercise of the Rights (or such other securities of the
Company or of any other person which may be issuable upon the
exercise of the Rights) and requests that certificates for
such shares be issued in the name of and delivered to:
Please insert social security
or other identifying number
---------------------------------------------------------------
(Please print name and address)
---------------------------------------------------------------
If such number of Rights shall not be all the Rights
evidenced by this Rights Certificate, a new Rights Certificate
for the balance of such Rights shall be registered in the name
of and delivered to:
Please insert social security
or other identifying number
---------------------------------------------------------------
(Please print name and address)
---------------------------------------------------------------
---------------------------------------------------------------
Dated: ---------------, ----
-------------------------------
Signature
A-7
61
Signature Guaranteed:
Certificate
-----------
The undersigned hereby certifies by checking the
appropriate boxes that:
(1) the Rights evidenced by this Rights Certificate
[ ] are [ ] are not being exercised by or on behalf of a
Person who is or was an Acquiring Person or an Affiliate or
Associate of any such Acquiring Person (as such terms are
defined pursuant to the Rights Agreement); and
(2) after due inquiry and to the best knowledge of
the undersigned, it [ ] did [ ] did not acquire the Rights
evidenced by this Rights Certificate from any Person who is,
was or became an Acquiring Person or an Affiliate or Associate
of an Acquiring Person.
Dated: -----------, ---- ---------------------
Signature
Signature Guaranteed:
NOTICE
------
The signature to the foregoing Election to Purchase
and Certificate must correspond to the name as written upon
the face of this Rights Certificate in every particular,
without alteration or enlargement or any change whatsoever.
A-8
62
APPENDIX
In Exhibit 4 to the printed 8-K, the following appear: on page 50,
the corporate seal of Anheuser-Busch Companies, Inc. and of Boatmen's
Trust Company, each of which is circular with the respective company's
name, state and date incorporated.