Exhibit (4)(iii)
THE HARTFORD STEAM BOILER
INSPECTION AND INSURANCE COMPANY
and
THE FIRST NATIONAL BANK OF BOSTON,
as Rights Agent
Rights Agreement
Dated as of November 28, 1988
TABLE OF CONTENTS
SECTION
1 Certain Definitions
2 Appointment of Rights Agent
3 Issue of Rights Certificates
4 Form of Rights Certificates
5 Countersignature and Registration
6 Transfer, Split Up, Combination and Exchange of Rights
Certificates; Mutilated, Destroyed, Lost or Stolen Rights
Certificates
7 Exercise of Rights; Purchase Price; Expiration Date of
Rights
8 Cancellation and Destruction of Rights Certificates
9 Form of Depositary Receipts
10 Countersignature and Registration of Depositary Receipts
11 Deposit of Stock
12 Transfer, Split Up, Combination and Exchange of Depositary
Receipts; Mutilated, Destroyed, Lost or Stolen Depositary
Receipts
13 Exchange of Depositary Receipts for Preferred Stock
14 Limitations on Execution and Delivery, Transfer, Surrender
and Exchange of Depositary Receipts
15 Cancellation and Destruction of Surrendered Depositary
Receipts
16 Distributions
17 Notice of Dividends, Fixing of Record Date for Receipt
Holders
18 Voting Rights
19 Changes Affecting Deposited Securities and
Reclassifications, Recapitalizations, etc.
20 Reports
21 Lists of Depositary Receipt Holders
22 Reservation and Availability of Capital Stock
23 Preferred Stock Record Date
24 Adjustment of Purchase Price, Number and Kind of Shares or
Number of Rights
25 Certificate of Adjusted Purchase Price or Number of Shares
26 Consolidation, Merger or Sale or Transfer of Assets or
Earning Power
27 Fractional Rights and Fractional Shares
28 Rights of Action
29 Agreement of Rights Holders
30 Rights Certificate Holder Not Deemed a Shareholder
31 Concerning the Rights Agent
32 Merger or Consolidation or Change of Name of Rights Agent
33 Duties of Rights Agent
34 Change of Rights Agent
35 Issuance of New Rights Certificates
36 Redemption and Termination
37 Notice of Certain Events
38 Notices
39 Supplements and Amendments
40 Successors
41 Determinations and Actions by the Board of Directors, etc.
42 Benefits of this Agreement
43 Severability
44 Governing Law
45 Counterparts
46 Descriptive Headings
Exhibit A - Certificate of Designation, Preferences and
Rights
Exhibit B - Form of Depositary Receipt
Exhibit C - Form of Rights Certificate
Exhibit D - Form of Summary of Rights
RIGHTS AGREEMENT
RIGHTS AGREEMENT, dated as of November 28, 1988 (the
"Agreement"), between The Hartford Steam Boiler Inspection and
Insurance Company, a Connecticut corporation (the "Company"), and
The First National Bank of Boston a national banking association
(the "Rights Agent").
W I T N E S S E T H
WHEREAS, on November 28, 1988 (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, without par value, of the Company (the "Common
Stock") outstanding at the close of business on December 8, 1988
(the "Record Date"), and has authorized the issuance of one Right
(as such number may hereinafter be adjusted pursuant to the
provisions of Section 24(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 Distribution Date each Right initially representing the right
to purchase one Depositary Receipt which is exchangeable for one
two-hundredth of a share of Series A Junior Participating
Preferred Stock of the Company having the rights, powers and
preferences set forth in the form of Certificate of Designation,
Preferences and Rights attached hereto as Exhibit A, 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 organized, appointed or established by the
Company for or pursuant to the terms of any such plan.
(b) "Adverse Person" shall mean any Person declared to
be an Adverse Person by The Board of Directors upon determination
that the criteria set forth in Section 24(a)(ii)(B) apply to such
Person.
(c) "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").
(d) A Person shall be deemed the "Beneficial 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
purchase or exchange, or (B) securities issuable upon exercise of
Rights at any time prior to the occurrence of a Triggering Event,
or (C) securities 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 35 hereof (the "Original Rights") or pursuant to Section
24(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 of or has "beneficial ownership" of (as
determined 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 "beneficially own," any security
under this subparagraph (ii as a result of an agreement,
arrangement 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
solicitation 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 (d)) or disposing of any voting securities of the
Company; provided, however, that nothing in this paragraph shall
cause a person engaged in business as an underwriter of
securities to be the "Beneficial Owner" of, or to "beneficially
own", any securities acquired through such person's
participation in good faith in a firm commitment underwriting
until the expiration of forty days after the date of such
acquisition.
(e) "Business Day" shall mean any day other than a
Saturday, Sunday or a day on which banking institutions in the
Commonwealth of Massachusetts or the State of New York are
authorized or obligated by law or executive order to close.
(f) "Close of business" on any given date shall mean
5:00 P.M., Boston time, on such date; provided, however, that if
such date is not a Business Day it shall mean 5:00 P.M., Boston
time, on the next succeeding Business Day.
(g) "Common Stock" shall mean the common stock, without
par value, 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.
(h) "Depositary Preferred Stock" shall mean the rights
represented by the Depositary Receipts issued hereunder and the
right to acquire Preferred Stock and all interests in respect
thereof represented thereby.
(i) "Depositary Receipts" shall mean the certificates
evidencing the Depositary Preferred Stock, which certificate
shall be substantially in the form of Exhibit B hereto.
(j) "Person" shall mean any individual, firm
corporation, partnership or other entity.
(k) "Preferred Stock" shall mean shares of Series A
Junior Participating Preferred Stock, without par value, of the
Company, and, to the extent that there are not a sufficient
number of shares of Series A Junior Participating Preferred Stock
authorized to permit the full exercise of the Rights, any other
series of Preferred Stock, without par value, of the Company
designated for such purpose containing terms substantially simi-
lar to the terms of the Series A Junior Participating Preferred
Stock.
(1) "Section 24(a)(ii) Event" shall mean any event
described in Section 24(a)(ii) (A) or (B) hereof.
(m) "Section 26 Event" shall mean any event described in
clauses (x), (y) or (z) of Section 26(a) hereof.
(n) "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 Acquiring Person has become such.
(o) "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.
(p) "Triggering Event" shall mean any Section
24(a)(ii) Event or any Section 26 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) and as depositary with respect to the Preferred
Stock for the Company and the holders of Depositary Receipts, 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 earliest of (i) the close of business on
the tenth Business Day after the Stock Acquisition Date (or, if
the tenth day after the Stock Acquisition Date occurs before the
Record Date, (the close of business on the Record Date), or (ii)
the close of business on the tenth Business Day (or such later
date as may be determined by the Board of Directors) 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 or any Subsidiary of 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 20% or more of the
shares of Common Stock then outstanding, (iii) the close of
business on the tenth Business Day after the Board of Directors
determines, pursuant to the criteria set forth in Section
24(a)(ii B) hereof, that a Person is an Adverse Person (the
earliest of (i), (ii) and (iii) being herein referred to as the
"Distribution Date", (x) 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 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 transferable
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 24(p) hereof, at
the time of distribution of the Rights Certificates, the Company
shall make the necessary and appropriate rounding adjustments (in
accordance with Section 27(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) As promptly as practicable following the Record
Date, the Company will send a copy of a Summary of Rights, in
substantially the form attached hereto as Exhibit D (the "Summary
of Rights"), by first-class, postage prepaid mail, to each record
holder of the Common Stock as of the close of business on the
Record Date, at the address of such holder shown on the records
of the Company. With respect to certificates for the Common Stock
outstanding as of the Record Date, until the Distribution Date,
the Rights will be evidenced by such certificates for the Common
Stock and the registered holders of the Common Stock shall also
be the registered holders of the associated Rights. Until the
earlier of the Distribution Date or the Expiration Date (as such
term is defined in Section 7(a) hereof), the transfer of any
certificates representing shares of Common Stock in respect of
which Rights have been issued shall also constitute the transfer
of the Rights associated with such shares of Common Stock.
(c) Rights shall be issued in respect of all shares of
Common Stock which are issued (whether originally issued or from
the Company's treasury) 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 entitles the holder
hereof to certain Rights as set forth in the Rights
Agreement between The Hartford Steam Boiler Inspection and
Insurance Company (the "Company") and The First National
Bank of Boston (the "Rights Agent") dated as of November 28,
1988 (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 the Company. Under certain
circumstances, as set forth in the Rights Agreement, such
Rights will be evidenced by separate certificates and will
no longer be evidenced by this certificate. The Company will
mail to the holder of this certificate 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 an Adverse
Person or any Affiliate or Associate of either (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, 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 certificates 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 and related certificates to be printed
on the reverse thereof) shall each be substantially in the form
set forth in Exhibit C hereto and may have such marks of
identification or designation and such legends, summaries or en-
dorsements printed thereon as the Company may deem appropriate
and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any applicable
law or with any rule or regulation made pursuant thereto or with
any rule or regulation of any stock exchange on which the Rights
may from time to time be listed, or to conform to usage. Subject
to the provisions of Section 24 and Section 35 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 Depositary Receipts 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
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 35 hereof that represents Rights beneficially
owned by: (i) an Acquiring Person, Adverse Person or any
Associate or Affiliate of an Acquiring Person or an Adverse
Person, (ii) a transferee of an Acquiring Person or an Adverse
Person (or of any such Associate or Affiliate) who becomes a
transferee after the Acquiring Person or the Adverse Person
becomes such, or (iii) a transferee of an Acquiring Person or an
Adverse Person (or of any such Associate or Affiliate) who
becomes a transferee prior to or concurrently with the Acquiring
Person or the Adverse Person becoming such and receives such
Rights pursuant to either (A) a transfer (whether or not for
consideration) from the Acquiring Person or the Adverse Person to
holders of equity interests in such Acquiring Person or Adverse
Person or to any Person with whom such Acquiring Person or
Adverse 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 24
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 Certificate are or
were beneficially owned by a Person who was or became an
Acquiring Person or an Adverse Person or an Affiliate or
Associate of an Acquiring Person or an Adverse 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 Rights
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 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
countersignature 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 Certificates 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 principal 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 provisions of Section 4(b),
Section 7(e) and Section 27 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 registered holder to purchase a like number of one
one-hundredths 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, and shall surrender the
Rights Certificate or Certificates to be transferred, split up,
combined or exchanged, with the form of assignment and
certificate duly executed, at the 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 completed 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 27
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 governmental 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 Certificate 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, destroyed 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 restrictions on exercisability set forth
in Section 22(c), Section 24(a)(iii) and Section 36(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 office or offices of the
Rights Agent designated for such purpose, together with payment
of the aggregate Purchase Price with respect to the total number
of Depositary Receipts (or other securities, cash or other as-
sets, as the case may be) as to which such surrendered Rights are
then exercisable, at or prior to the earlier of (i) the close of
business on November 28, 1988 (the "Final Expiration Date"), or
(ii) the time at which the Rights are redeemed as provided in
Section 36 hereof (the earlier of (i) and (ii) being herein
referred to as the "Expiration Date").
(b) The Purchase Price for each Depositary Receipt
pursuant to the exercise of a Right shall initially be $110.00,
and shall be subject to adjustment from time to time as provided
in Sections 24 and 26(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 Depositary
Receipt (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 33(k) hereof, thereupon promptly (i) make
available certificates for the total number of Depositary
Receipts to be purchased and the Company hereby irrevocably
authorizes its transfer agent to comply with all such requests,
or (ii) requisition from the Company the amount of cash, if any,
to be paid in lieu of fractional Depositary Receipts in
accordance with Section 27 hereof, (iii) after receipt of such
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 24(a)(iii) hereof) shall be
made in cash or by certified bank check or bank draft payable to
the order of the Company. 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 24(a) hereof, the Company will make all arrangements
necessary so that such other securities, cash and/or other
property are available for distribution 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 provi-
sions of Section 27 hereof.
(e) Notwithstanding anything in this Agreement to the
contrary , from and after the first occurrence of a Section
24(a)(ii) Event, any Rights beneficially owned by (i) an
Acquiring Person, an Adverse Person or an Associate or Affiliate
of an Acquiring Person or an Adverse Person, (ii) a transferee of
an Acquiring Person or an Adverse Person (or of any such
Associate or Affiliate) who becomes a transferee after the
Acquiring Person or the Adverse Person becomes such, or (iii) a
transferee of an Acquiring Person or an Adverse Person (or of any
such Associate or Affiliate) who becomes a transferee prior to or
concurrently with the Acquiring Person or the Adverse Person
becoming such and receives such Rights pursuant to either (A) a
transfer (whether or not for consideration) from the Acquiring
Person or the Adverse Person to holders of equity interests in
such Acquiring Person or Adverse Person or to any Person with
whom the Acquiring Person or the Adverse 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 whatsoever 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 an Adverse
Person or any of their respective Affiliates, Associates or
transferees hereunder.
(f) Notwithstanding anything in this Agreement to the
contrary, neither the Rights Agent nor the Company shall be
obligated to undertake any action with respect to a registered
holder 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, combination 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 purchased 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 the written request of the Company, destroy
such cancelled Rights Certificates, and in such case shall deliv-
er a certificate of destruction thereof to the Company.
Section 9. Form of Depositary Receipts. The Depositary
Receipts (and the forms of election to exercise and of assignment
to be printed on the reverse thereof) shall each be substantially
in the form set forth in Exhibit B hereto and may have such marks
of identification or designation and such legends, summaries or
endorsements printed thereon as the Company may deem appropriate
and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any applicable
law or with any rule or regulation make pursuant thereto or with
any rule or regulation of any stock exchange on which the
Depositary Receipts may from time to time be listed, or to
conform to usage. Subject to the provisions of this Agreement,
the Depositary Receipts, whenever issued, shall be dated as of
the date of issuance and on their face shall entitle the holders
thereof to exchange each Depositary Preferred Share for one
two-hundredth of a share of Preferred Stock, subject to
adjustment as provided herein.
Section 10. Countersignature and Registration of Depositary
Receipts.
(a) The Depositary Receipts 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 Corporate Secretary or an
Assistant Secretary of the Company, either manually or by
facsimile signature. The Depositary Receipts 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 Depositary Receipts
shall cease to be such officer of the Company before
countersignature by the Rights Agent and issuance and delivery by
the Company, such Depositary Receipts, 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 Depositary Receipts had not ceased to be such officer
of the Company; and any Depositary Receipts may be signed on
behalf of the Company by any person who, at the actual date of
the execution of such Depositary Receipts, shall be a proper
officer of the Company to sign such Depositary Receipts, 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 office or offices
designated as the appropriate place for surrender of Depositary
Receipts upon exercise or transfer, books for registration and
transfer of the Depositary Receipts issued hereunder. Such books
shall show the names and addresses of the respective holders of
the Depositary Receipts and the number of shares of Depositary
Preferred Stock evidenced on its face by each of the Depositary
Receipts. Depositary Receipts shall be in denominations of any
whole number of shares of Depositary Preferred Stock.
Section 11. Deposit of Stock.
(a) Subject to the terms and conditions of this
Agreement, no later than the Distribution Date, the Company shall
deposit by delivery to the Rights Agent a certificate or
certificates representing all the authorized shares of Preferred
Stock, properly endorsed or accompanied, if required by law, by a
duly executed instrument of transfer or endorsement, in form
satisfactory to the Rights Agent, together with all such
certifications as may be required by the Rights Agent in
accordance with the provisions of this Agreement.
(b) The Rights Agent shall hold shares of Preferred
Stock deposited by the Company in trust separate and apart from
its other assets, at the Rights Agent's office designated for
such purpose.
Section 12. Transfer, Split Up, Combination and Exchange of
Depositary Receipts; Mutilated, Lost or Stolen Depositary
Receipt..
(a) Subject to the provisions of this Agreement at any
time after the close of business on the Distribution Date, any
Depositary Receipt or Receipts may be transferred, split up,
combined or exchanged for another Depositary Receipt or Receipts
entitling the registered holder to exchange such Depositary
Receipt or Receipts for a like number of shares of Depositary
Preferred Stock as the Depositary Receipt or Receipts surrendered
then entitled such holder (or former holder in the case of a
transfer) to receive upon surrender for exchange. Any registered
holder desiring to transfer, split up, combine or exchange any
Depositary Receipt or Receipts shall make such request in writing
delivered to the Rights Agent, and shall surrender the Depositary
Receipt or Receipts to be transferred, split up, combined or
exchanged at the office or offices of the Rights Agent designated
for such purpose.
(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 Depositary receipt, and, in the
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 there-
to, and upon surrender to the Rights Agent and cancellation of
the Depositary Receipt if mutilated, the Company will execute and
deliver a new Depositary Receipt of like tenor to the Rights
Agent for countersignature and delivery to the registered owner
in lieu of the Depositary Receipt so lost, stolen, destroyed or
mutilated.
Section 13. Exchange of Depositary Receipts for Preferred
Stock.
(a) Subject to Section 27(b) hereof, at any time after
the Distribution Date, the registered holder of any Depositary
Receipt may exchange the Depositary Receipts evidenced thereby in
whole or in part for one two-hundredth of a share of Preferred
Stock and all money and other property represented thereby, if
any, by surrendering Depositary Receipts representing such shares
of Depositary Preferred Stock for such purpose, in an integral
multiple of one such share, at the Rights Agent's office
designated for such purpose. Thereafter, without unreasonable
delay, the Rights Agent shall deliver to such holder, or to the
person or persons designated by such holder as hereinafter
provided, the number of whole shares, if any, of Preferred Stock
and all money and other property represented by the Depositary
Preferred Shares so surrendered for withdrawal.
(b) In case the registered holder of any certificate
evidencing Depositary Receipts shall exercise less than all the
Depositary Receipts evidenced thereby, a new certificate
evidencing Depositary Receipts equivalent to the Depositary
Receipts remaining unexercised shall be issued by the Rights
Agent and delivered to, or upon the order of, the registered
holder of such Depositary Receipt, registered in the name or
names as may be designated by such holder, subject to the
provisions of Section 27 hereof.
(c) If the Preferred Stock and the money and other
property being withdrawn is to be delivered to a person or
persons other than the holder of the Depositary Receipts being
surrendered for withdrawal, such holder shall execute and deliver
to the Rights Agent a written order so directing the Rights Agent
and the Rights Agent may require that the Depositary Receipt
surrendered for withdrawal by such holder by properly endorsed in
blank or accompanied by a properly executed instrument of
transfer in blank.
(d) Delivery of the Preferred Stock and the money and
other property represented by Depositary Receipts surrendered for
exchange shall be made by the Rights Agent at its office
designated for such purpose, except that, at the written request,
risk and expense of the holder surrendering such shares, and for
the account of the holder thereof, such delivery may be made at
such other place as may be designated by such holder.
Section 14. Limitations on Execution and Delivery, Transfer,
Surrender and Exchange of Depositary Receipts.
(a) As a condition precedent to the execution and
delivery, transfer, split-up, combination, surrender or exchange
of any Depositary Receipt, the Rights Agent,
or any agent of the Rights Agent, may require payment to it of a
sum sufficient for reimbursement of any tax or other governmental
charge with respect thereto (including any such tax or charge
with respect to Preferred Stock being withdrawn), may require the
production of proof satisfactory to it as to the identity and
genuineness of any signature and may also require compliance with
such regulations, if any, as the Rights Agent may establish
consistent with the provisions of this Agreement.
(b) The transfer of Depositary Receipts may be refused,
or the transfer, surrender or exchange of outstanding Depositary
Receipts may be suspended during any period when the register of
stockholders of the Company is closed, or if any such action is
deemed necessary or advisable by the Rights Agent or the Company
at any time or from time to time because of any requirement of
law or of any government or governmental body or commission or
stock exchange, or under any provision of this Agreement.
Section 15. Cancellation and Destruction of Surrendered
Depositary Receipts. All Depositary Receipts surrendered for the
purpose of exercise, transfer, split up, combination 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 Depositary Receipts 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 Depositary Receipts purchased or acquired
by the Company otherwise than upon the exercise thereof. The
Rights Agent shall deliver all cancelled Depositary Receipts to
the Company.
Section 16. Distributions.
(a) Whenever the Rights Agent shall receive any case
dividend or other cash distribution on the Preferred Stock, the
Rights Agent shall distribute such amount to record holders of
Depositary Receipts on the record date fixed pursuant to Section
17 hereof in proportion to the number of Depository Receipts held
by them; provided, however, that in case the Company or the
Rights Agent shall be required to withhold and does withhold from
any cash dividend or other cash distribution in respect of the
Preferred Stock an amount on account of taxes, the amount made
available for distribution or distributed on the Depositary Re-
ceipts issued in respect of such Preferred Stock shall be reduced
accordingly. The Rights Agent shall distribute or make available
for distribution, as the case may be, only such amount, however,
as can be distributed without attributing to any record holder of
a Depositary Receipt a fraction of one cent and any balance not
so distributable shall be held by the Rights Agent (without
liability for interest thereon) and shall be added to and be
treated as part of the next sum received by the Rights Agent for
distribution to record holders of Depositary Receipts then
outstanding.
(b) Whenever the Rights Agent shall receive any
distribution other than cash upon the Preferred Stock, the Rights
Agent shall cause such securities or property received by it to
be distributed to the record holders of Depositary Receipts on
the record date fixed pursuant to Section 17 hereof in proportion
to the number of Depositary Receipts held by them, in any manner
that the Rights Agent may deem equitable and practicable for
accomplishing such distribution. If in the opinion of the Rights
Agent such distribution cannot be made proportionately among the
record holders of Depositary Receipts entitled thereto, or if for
any other reason (including any requirement that the Company or
the Rights Agent withhold an amount on account of taxes) the
Rights Agent deems such distribution not to be feasible, the
Rights Agent may adopt such method as it deems equitable and
practicable for the purpose of effecting such distribution,
including the public or private sale of the securities or
property thus received, or any part thereof, at such place or
places and upon such terms as it may deem proper. The net
proceeds of any such sale shall be distributed or made available
for distribution, as the case may be, by the Rights Agent to the
holders of Depositary Receipts entitled thereto as in the case of
a distribution received in cash.
(c) Whenever the Company shall offer or cause to be
offered to the holders of the Preferred Stock any rights,
preferences or privileges to subscribe for or to purchase any
securities or any rights, preferences or privileges of any other
nature, such rights, preferences or privileges shall be made
available by the Rights Agent to the holders of Depositary
Receipts in such manner as the Rights Agent may determine, either
by the issue to the record holders of Depositary Receipts on the
record date fixed pursuant to Section 17 hereof of warrants
representing such rights, preferences or privileges or by such
other methods as may be approved by the Rights Agent in its
discretion; provided, however, that if at the time of issue or
offer of any such rights, preferences or privileges, the Rights
Agent determines that it is not lawful or feasible to make such
rights, preferences or privileges available to holders of
Depositary Receipts by the issue of warrants or otherwise, or if
and to the extent so instructed by holders of Depositary Receipts
who do not desire to exercise such rights, preferences or
privileges, the Rights Agent, in its discretion, may, if
applicable law permits transfer, sell such rights, preferences or
privileges at public or private sale, at such place or places and
upon such terms as it may deem proper. The net proceeds of any
such sale shall be distributed by the Rights Agent to the record
holders of Depositary Receipts entitled thereto as in the case of
a distribution received in cash.
(d) If registration under the Securities Act of the
securities to which any rights, preferences or privileges relate
is required in order for holders of Depositary Receipts to be
offered or sold the securities to which such rights, preferences
or privileges relate, the Company agrees with the Rights Agent
that it will file promptly a registration statement pursuant to
the Securities Act with respect to such rights, preferences or
privileges and securities and use its best efforts and take all
steps available to it to cause such registration statement to
become effective within a reasonable period of time before such
rights, preferences or privileges shall expire. In no event shall
the Rights Agent make available to the holders of Depositary
Receipts any right, preference or privilege to subscribe for or
to purchase any securities unless and until such a registration
statement is in effect, or unless the offering and sale of such
securities to the holders of such Depositary Receipts are exempt
from registration under the provisions of the Securities Act.
(e) If any other action under the laws of any
jurisdiction or any governmental or administrative authorization,
consent or permit is required in order for such rights,
preferences or privileges to be made available to holders of
Depositary Receipts, the Company agrees with the Rights Agent
that the Company will use its best efforts to take such action to
obtain such authorization, consent or permit sufficiently in
advance of the expiration of the rights, preferences or
privileges to enable holders of Depositary Receipts to exercise
such rights, preferences or privileges.
Section 17. Notice of Dividends, Fixing of Record Date for
Receipt-Holders. Whenever any cash dividend or other cash
distribution shall become payable or any distribution other than
cash shall be made, or whenever rights, preferences or privileges
shall be offered, with respect to the Preferred Stock, or
whenever the Rights Agent shall receive notice of any meeting at
which holders of Preferred Stock are entitled to vote or of which
holders of Preferred Stock are entitled to notice, the Rights
Agent shall fix a record date (which shall be the record date
fixed by the Company with respect to the Preferred Stock) for the
determination of the holders of Depositary Receipts who shall be
entitled to receive such dividend, distribution, rights,
preferences or privileges or the net proceeds of the sale
thereof, to give instructions for the exercise of voting rights
at any such meeting or who shall be entitled to notice of such
meeting, and, not less than 10 days prior to such record date,
the Rights Agent shall mail notice of such record date to the
holders of record of Depositary Receipts as of the date notice of
such record date is received by the Rights Agent from the
Company; provided, however, that the Company shall have given the
Rights Agent not less than 15 days' prior written notice of such
record date.
Section 18. Voting Rights. Upon receipt of notice of any
meeting at which the holders of Preferred Stock are entitled to
vote, the Rights Agent shall include in the notice required to be
mailed to the record holders of Depositary Receipts pursuant to
Section 17: (a) such information as is contained in the notice of
meeting received from the Company; (b) a statement that the
holders of Depositary Receipts at the close of business on the
record date specified therein will be entitled, subject to any
applicable provisions of law and of the Charter of the Company,
to instruct the Rights Agent as to the exercise of the voting
rights pertaining to the amount of Preferred Stock represented by
their respective shares of Depositary Preferred Stock; and (c) a
brief statement as to the manner in which such instructions may
be given. Upon the written request of a holder of a Depositary
Receipt on such record date, the Rights Agent
shall endeavor insofar as practicable to vote or cause to be
voted the amount of Preferred Stock represented by such
Depositary Receipt in accordance with the instructions set forth
in such request. The Company hereby agrees to take all action
which may be deemed necessary by the Rights Agent in order to
enable the Rights Agent to vote such Preferred Stock or cause
such Preferred Stock to be voted. In the absence of specific
instructions from the holder of a Depositary Receipt, the Rights
Agent will abstain from voting to the extent of the Preferred
Stock underlying such Depositary Receipt.
Section 19. Changes Affecting Deposited Securities and
Reclassifications,
Recapitalizations, etc. Upon any change in par or stated value,
split-up, consolidation or any other reclassification of the
Preferred Stock, or upon any recapitalization, reorganization,
merger, consolidation or sale of assets affecting the Company or
to which it is a party, the Rights Agent shall, with the approval
of the Company and in such manner as the Rights Agent may deem
equitable, treat any securities into which the Preferred Stock
shall be changed or which shall be received in respect of the
Preferred Stock shall be changed or which shall be received by
the Rights Agent in exchange for or in respect of the Preferred
Stock as new deposited securities under this Agreement, and
Depositary Receipts then outstanding shall thereafter be
exchangeable for the new securities into which the Preferred
Stock shall be changed or which are so received in exchange or
conversion. In any such case the Rights Agent may in its
discretion, with the approval of the Company, execute and deliver
additional Depositary Receipts, or may call for the surrender of
all outstanding Depositary Receipts to be exchanged for new
receipts specifically describing such new deposited securities,
or, if appropriate, and-at the direction of the Company, shall
call for the surrender of all outstanding Depositary Receipts in
exchange for the new deposited securities.
Section 20. Reports. The Rights Agent shall make available
for inspection by holders of Depositary Receipts at its office
designated for such purpose, and at such other places as it may
from time to time deem advisable, any reports and communications
received from the Company which are both (a) received by the
Rights Agent as the depositary for the Preferred Stock and (b)
made generally available to the holders of such Preferred Stock
by the Company.
Section 21. Lists of Depositary Receipt Holders. Promptly
upon request by the Company, the Rights Agent shall furnish to it
a list, as of the most recent date practicable, of the names,
addresses and holding as of shares of Depositary Preferred Stock
by all persons in whose names Depositary Receipts are registered
on the depositary books of the Rights Agent.
Section 22. 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 provided in
this Agreement including Section 24(a)(iii) hereof, will be
sufficient to permit the exercise in full of all outstanding
Rights.
(b) So long as the shares of Preferred Stock (and,
following the occurrence of a Triggering Event, Common Stock
and/or other securities) issuable and deliverable 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 24(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 24(a)(iii)
hereof, 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 or
(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" laws of the various
states in connection with the exercisability 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 22(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. In addition, if the Company
shall determine that a registration statement is required fol-
lowing the Distribution Date, the Company may temporarily suspend
the exercisability of the Rights until such time as a
registration statement has been declared effective.
Notwithstanding any provision of this Agreement to the contrary,
the Rights shall not be exercisable in any jurisdiction if the
requisite qualification in such jurisdiction shall not have been
obtained, the exercise thereof shall not be permitted under
applicable law or a registration statement shall not have been
declared effective.
(d) The Company covenants and agrees that it will take
all such action as ma be necessary to ensure that all Depositary
Receipts (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 Depositary Receipts (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 Depositary Receipts (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
Depositary Receipts (or Common Stock and/or other securities, 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 by the holder of such
Rights Certificate at the time of surrender) or until it has been
established to the Company's satisfaction that no such tax is
due.
Section 23. Preferred Stock Record Date. Each person in
whose name any certificate for a number-of Depositary Receipts
(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 24. Adjustment of Purchase Price Number and Kind of
Shares or Number of Rights. The Purchase Price, the number and
kind of Depositary Receipts covered by each Right and the number
of Rights outstanding are subject to adjustment from time to time
as provided in this Section 24.
(a)(i) In the event the Company shall at any time after
the date of this Agreement (A) declare a dividend on the
Preferred Stock payable in shares of Preferred Stock, (B) subdi-
vide the outstanding Preferred Stock, (C) combine the outstanding
Preferred Stock into a smaller number of shares, or (D) issue any
shares of its capital stock in a reclassification of the
Preferred Stock (including any such reclassification in
connection with a consolidation or merger in which the Company is
the continuing or surviving corporation), except as otherwise
provided in this Section 24(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 subdivision,
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 Depositary Receipts 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
Depositary Receipt transfer books of the Company were open, such
holder would have owned upon such exercise and been entitled to
receive by virtue of such dividend, subdivision, combination or
reclassification. If an event occurs which would require an ad-
justment under both this Section 24(a)(i) and Section 24(a)(ii)
hereof, the adjustment provided for in this Section 24(a)(1)
shall be in addition to, and shall be made prior to, any
adjustment required pursuant to Section 24(a)(ii) hereof.
(ii) In the event: (A) 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), alone or together with
its Affiliates and Associates, shall, at any time after the
Rights Dividend Declaration Date, become the Beneficial Owner of
20% or more of the shares of Common Stock then outstanding,
unless the event causing the 20% threshold to be crossed is a
transaction set forth in Section 26(a) hereof, or is an
acquisition of shares of Common Stock pursuant to a tender offer
or an exchange offer for all outstanding shares of Common Stock
at a price and on terms determined by at least a majority of the
members of the Board of Directors who are not officers of the
Company and who are not representatives, nominees, Affiliates or
Associates of an Acquiring Person, after receiving advice from
one or more investment banking firms, to be (a) at a price which
is fair to shareholders (taking into account all factors which
such members of the Board deem relevant including, without
limitation prices which could reasonably be achieved if the
Company or its assets were sold on an orderly basis designed to
realize maximum value) and (b) otherwise in the best interests of
the Company and its shareholders, or (B) the Board of Directors
shall declare any Person to be an Adverse Person, upon a
determination that such Person, alone or together with its
Affiliates and Associates, has, at any time after the Rights
Dividend Declaration Date, become the Beneficial Owner of an
amount of Common Stock which the Board of Directors determines to
be substantial (which amount shall in no event be less than 10%
of the shares of Common Stock then outstanding) and a
determination by the Board of Directors of the Company, after
reasonable inquiry and investigation, including consultation with
such persons as such directors shall deem appropriate, that (a)
such Beneficial Ownership by such Person is intended to cause the
Company to repurchase the Common Stock beneficially owned by such
Person or to cause pressure on the Company to take action or
enter into a transaction or series of transactions intended to
provide such Person with short-term financial gain under
circumstances where the Board of Directors determines that the
best long-term interests of the Company and its shareholders
would not be served by taking such action or entering into such
transaction or series of transactions at that time or (b) such
Beneficial Ownership is causing or reasonably likely to cause a
material adverse impact (including, but not limited to, by
jeopardizing the Company's licenses or authorizations from, or
relationships with, state insurance regulators, or by impairing
relationships with customers or the Company's ability to maintain
its competitive position) on the business or prospects of the
Company to the detriment of the Company's shareholders, then
promptly following the occurrence of a Section 24(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 Depositary Receipts, 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 number of one two hundredths of a share of
Preferred Stock for which a Depositary Receipt was exercisable
immediately prior to the first occurrence of a Section 24(a)(ii)
Event, and (y) dividing that product (which, following such first
occurrence, shall thereafter be referred to as the "Purchase
Price" for each Right and for all purposes of this Agreement) by
50% of the current market price (determined pursuant to Section
24(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 Company's Charter 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 foregoing
subparagraph (ii) of this Section 24(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 excess, the "Spread"), and (B) with
respect to each Right, make adequate provision to substitute for
the Adjustment Shares, u on 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 referred stock,, "common stock equivalents"), (4) debt
securities of the Company, (5) other assets or (6) any combina-
tion 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
nationally recognized investment banking firm selected by the
Board of Directors of the Company; provided, however, if the
Company shall not have made adequate provision to deliver value
pursuant to clause (B) above within thirty (30) days following
the later of (x) the first occurrence of a Section 24(a)(ii)
Event and (y) the date on which the Company' s right of
redemption pursuant to Section 36(a) expires (the later of (x)
and (y) being referred to herein as the "Section 24(a)(ii)
Trigger Date"), then the Company shall be obligated to deliver,
upon the surrender for exercise of a Right and without requiring
payment 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 determine in good faith
that it is likely that sufficient additional shares of Common
Stock could be authorized for issuance upon exercise in
full of the Rights, 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 24(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 "Substitution Period"). To the extent that the Company
determines that some action need be taken pursuant to the first
and/or second sentences of this Section 24(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
distribution to be made pursuant to such first sentence and to
determine the value thereof. In the event of any such suspension,
the Company shall issue a public announcement stating that the
exercisability of the Rights has been temporarily suspended, as
well as a public announcement at such time as the suspension is
no longer in effect. For purposes of this Section 24(a)(iii), the
value of the Common Stock shall be the current market price (as
determined pursuant to Section 24(d) hereof) per share of the
Common Stock on the Section 24(a)(ii) Trigger Date and the value
of any "common stock equivalent" shall be deemed to have the same
value as the Common Stock on such date.
(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 Preferred
Stock or per share of equivalent preferred stock (or having a
conversion price per share, if a security convertible into
Preferred Stock or equivalent preferred stock) less than the
current market price (as determined pursuant to Section 24(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.
(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 earning of the
Company), assets (other than a dividend payable in Preferred
Stock, but including and dividend payable in stock other than
Preferred Stock or subscription rights or warrants (excluding
those referred to in Section 24(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 24(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 Directors of the Company, whose determination shall be de-
scribed 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 denominator of which shall
be such current market price (as determined pursuant to Section
24(d) hereof) per share of Preferred Stock. Such adjustments
shall be made successively whenever such a record date is fixed,
and in the event that such distribution is not so made, the
Purchase Price shall 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 computation hereunder,
other than computations made pursuant to Section 24(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 defined)
immediately prior to such date, and for purposes of computations
made pursuant to Section 24(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
immediately 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 dividend or distribution on
such Common Stock payable in shares of such Common Stock or
securities convertible into shares of such Common Stock (other
than the Rights), or (B) any subdivision, 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 distribution, or the record date for
such subdivision 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 reporting
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 principal consolidated transaction
reporting system with respect to securities listed on the
principal 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
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 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
organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in the
Common Stock selected by the Board of Directors of the Company.
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 conclusive 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 24(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 24(d),
the "current market price" per share of Preferred Stock shall be
conclusively deemed to be an amount equal to 200 (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 Preferred 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 purposes. For all
purposes of this Agreement, the "current market price" of one
two-hundredth of a share of Preferred Stock shall be equal to the
"current market price" of one share of Preferred Stock divided by
200.
(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 24(e) are not
required to be made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under this
Section 24 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 24(e), any
adjustment required by this Section 24 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 24(a)(ii) or Section 26(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 24(a), (b), (c), (e), (g),
(h), (i), (j), (k) and (m), and the provisions of Sections 7. 22,
239 26 and 27 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 Depositary Receipts 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 24(i), upon each adjustment of the
Purchase Price as a result of the calculations made in Sections
24(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
Depositary Receipts (calculated to the nearest one-millionth) ob-
tained by (i) multiplying (x) the number of Depositary Receipts
covered by a Right immediately prior to this adjustment by (y)
the Purchase Price in effect immediately after 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 Depositary Receipts
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 Depositary Receipts 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 immediately after
adjustment of the Purchase Price. The Company shall make a public
announcement of its election to adjust the number of Rights,
indicating the record date for the adjustment, and, if known at
the time, the amount of the adjustment to be made. This record
date may be the date on which the Purchase Price is adjusted or
any day thereafter, but, if the 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 24(i), the Company shall, as promptly as practicable,
cause to be distributed to holders of record of Rights
Certificates on such record date Rights Certificates evidencing,
subject to Section 27 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
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 adjustment.
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 Depositary Receipts issuable upon
the exercise of the Rights, the Rights Certificates theretofore
and thereafter issued may continue to express the Purchase Price
per Depositary Receipt and the number of Depositary Receipts
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 Depositary Preferred Stock issuable upon
exercise of the Depositary Receipts, the Company shall take any
corporate action which may, in the opinion of its counsel, be
necessary in order that the Company may validly and legally issue
fully paid and nonassessable shares of Preferred Stock at such
adjusted Purchase Price.
(l) In any case in which this Section 24 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 Depositary Receipts and other capital stock or securities of
the Company, if any, issuable upon such exercise over and above
the number of Depositary Receipts and other capital stock or
securities of the Company, if any, issuable upon such exercise on
the basis of the Purchase Price in effect prior to such
adjustment; provided, however, that the Company shall deliver to
such holder a due bill or other appropriate instrument evidencing
such holder's right to receive such additional shares (fractional
or otherwise) or securities upon the occurrence of the event
requiring such adjustment.
(m) Anything in this Section 24 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 24, 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 subdivision 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 24 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 into any with Section 24(o)-hereof),
(ii) merge with or other Person (other than a Subsidiary of the
Company in a transaction which complies with Section 24(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, cash flow or earning power aggregating more
than 50% of the assets, cash flow or earning power of the Company
and its Subsidiaries (taken as a whole) to any other Person or
Persons (other than the Company and/or any of its Subsidiaries in
one or more transactions each of which complies with Section
24(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 immediately after such consolidation,
merger or sale, the shareholders of the Person who constitutes,
or would constitute, the "Principal Party" for purposes of
Section 26(a) hereof shall have received a distribution of Rights
previously owned by such Person or any of its Affiliates and
Associates.
(o) The Company covenants and agrees that, after the
Distribution Date, it will not, except as permitted by Section 36
or Section 39 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.
(q) The failure by the Board of Directors to declare a
Person to be an Adverse Person following such Person becoming the
Beneficial Owner of 10% or more of the outstanding Common Stock
shall not imply that such Person is not an Adverse Person or
limit the Board of Directors' right at any time in the future to
declare such Person to be an Adverse Person. In considering
whether to declare a Person to be an Adverse Person,, the Board
of Directors may consider the actions or findings of one or more
state insurance regulators with respect to any required approvals
by such regulators of such Person's actions with respect to the
Company. Notwithstanding the foregoing, the approval by any one
or more state insurance regulators of any action of any Person
shall not be deemed to prohibit or restrict the ability of the
Board of Directors to declare that such Person is an Adverse
Person upon determination that the criteria set forth in Section
24(a)(ii)(B) apply to such Person.
Section 25. Certificate of Adjusted Purchase Price or Number
of Shares. Whenever an adjustment is made as provided in Section
24 and Section 26 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
Preferred Stock and the Common Stock, a copy of such certificate
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 38 hereof. The Rights Agent shall be
fully protected in relying on any such certificate and on any
adjustment therein contained and shall not be deemed to have
knowledge of any such adjustment unless and until it shall have
received such certificate.
Section 26. Consolidation, Merger, or Sale or Transfer of
Assets, Cash Flow 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 24(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 24(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, cash flow or earning power aggregating more
than 50% of the assets, cash flow 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 24(o)
hereof), then, and in each such case (except as may be
contemplated by Section 26(d) hereof), 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, non-assessable and freely
tradable shares of Common Stock of the Principal Party (as such
term is hereinafter defined), not subject to any liens,
encumbrances, rights of first refusal or other adverse claims, as
shall be equal to the result obtained by (1) multiplying the then
current Purchase Price by the number of Depositary Receipts for
which a Right is exercisable immediately prior to the first
occurrence of a Section 26 Event (or, if a Section 24(a)(ii)
Event has occurred prior to the first occurrence of a Section 26
Event, multiplying the number of such Depositary Receipts for
which a Right was exercisable immediately prior to the first
occurrence of a Section 24(a)(ii) Event by the Purchase Price in
effect immediately prior to such first occurrence), and dividing
that product (which, following the first occurrence of a Section
26 Event, shall be referred to as the "Purchase Price" for each
Right and for all purposes of this Agreement) by (2) 50% of the
current market price (determined pursuant to Section 24(d)(i)
hereof) per share of the Common Stock of such Principal Party on
the date of consummation of such Section 26 Event; (ii) such
Principal Party shall thereafter be liable for, and shall assume,
by virtue of such Section 26 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 24 hereof shall apply only to such Principal Party
following the first occurrence of a Section 26 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 connection 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 24(a)(ii) hereof shall be of no effect
following the first occurrence of any Section 26 Event.
(b) "Principal Party" shall mean
(i) in the case of any transaction described in clause (x)
or (y) of the first sentence of Section 26(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 securities are so issued, the Person that is the other party
to such merger or consolidation; and
(ii) in the case of any transaction described in clause (z)
of the first sentence of Section 26(a), the Person that is the
party receiving the greatest portion of the assets, cash flow or
earning power transferred pursuant to such transaction or
transactions;
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 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 indirectly, 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 authorized 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 26
and unless prior thereto the Company and such Principal Party
shall have executed and delivered to the Rights Agent a
supplemental agreement providing for the terms set forth in
paragraphs(a) and (b) of this Section 26 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 26, 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 statement to (A) become
effective as soon as practicable 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 requirements for
registration on Form 10 under the Exchange Act.
The provisions of this Section 26 shall similarly apply to
successive mergers or consolidations or sales or other transfers.
In the event that a Section 26 Event shall occur at any time
after the occurrence of a Section 24(a)(ii) Event, the Rights
which have not theretofore been exercised shall thereafter become
exercisable in the manner described in Section 26(a).
(d) Notwithstanding anything in this Agreement to the
contrary, Section 26 shall not be applicable to a transaction
described in subparagraphs (x) and (y) of Section 26(a) if (i)
such transaction is consummated with a Person or Persons who
acquired shares of Common Stock pursuant to a tender offer or
exchange offer for all outstanding shares of Common Stock which
complies with the provisions of Section 24(a)(ii)(A) hereof (or a
wholly owned subsidiary of any such Person or Persons), (ii) the
price per share of Common Stock offered in such transaction is
not less than the price per share of Common Stock paid to all
holders of shares of Common Stock whose shares were purchased
pursuant to such tender offer or exchange offer and (iii) the
form of consideration being offered to the remaining holders of
shares of Common Stock pursuant to such transaction is the same
as the form of consideration paid pursuant to such tender offer
or exchange offer. Upon consummation of any such transaction
contemplated by this Section 26(d), all Rights hereunder shall
expire.
Section 27. 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 24(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 issuable, an amount in cash equal to
the same fraction of the current market value of a whole Right.
For purposes of this Section 27(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 reporting
system with respect to securities listed on the principal
national securities exchange on which the Rights are listed or
admitted to trading, or if the Rights are not listed or admitted
to trading on any national securities exchange, the last quoted
price or, if not so quoted, the average of the high bid and low
asked prices in the over-the-counter market, as reported by
NASDAQ or such other system then in use or, if on any such date
the Rights are not quoted by any such organization, the average
of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights selected
by the Board of Directors of the Company. If on any such date no
such market maker is making a market in the Rights the fair value
of the Rights on such date as determined in good faith by the
Board of Directors of the Company shall be used.
(b) The Company shall not issue fractions of shares of
Preferred Stock upon exercise of the Depositary Receipts or
distribute certificates which evidence fractional shares of
Preferred Stock. In lieu of fractional shares of Preferred Stock,
the Company shall pay to the registered holders of Depositary
Receipts at the time such Depositary Receipts are exercised as
herein provided an amount in cash equal to the same fraction of
the current market value of one two-hundredth of a share of
Preferred Stock. For purposes of this Section 27(b), the current
market value of one two-hundredth of a share of Preferred Stock
shall be one two-hundredth of the closing price of one share of
Preferred Stock (as determined pursuant to Section 24(d)(ii)
hereof) for the Trading Day immediately prior to the date of such
exercise.
(c) Following the occurrence of a Triggering Event, the
Company shall not 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 shall 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 (1) share of Common
Stock. For purposes of this Section 27(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
24(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 such
Right expressly waives his right to receive any fractional Rights
or any fractional shares upon exercise of a Right, except as
permitted by this Section 27.
Section 28. Rights of Action. All rights of action in
respect or this Agreement, except those rights of action vested
in the Rights Agent pursuant to Sections 31 or 33 hereof, 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 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 29. 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 Certificates 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, shall
be required to be affected by any notice to the contrary; and
(d) notwithstanding anything in this Agreement to the
contrary, neither the Company nor the Rights Agent shall have any
liability to any holder of a Right or other Person as a result of
its inability to perform any of its obligations under this
Agreement by reason of any preliminary or permanent injunction or
other order, decree or ruling issued by a court of competent
jurisdiction or by a governmental, regulatory or administrative
agency or commission or any statute, rule, regulation or
executive order promulgated or enacted by any governmental
authority, prohibiting or otherwise restraining performance of
such obligation; 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 30. Rights Certificate Holder Not Deemed a
Shareholder. No holder as such, of any Rights Certificate shall
be entitled to vote, receive dividends or be deemed for any
purpose the holder of the number of shares of Preferred Stock or
any other securities of the Company which may at any time be
issuable on the exchange of the Depositary Receipts issuable on
the exercise of the Rights represented thereby, nor shall
anything contained herein or in any Rights Certificate be
construed to confer upon the holder of any Rights Certificate, as
such, any of the rights of a 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 Section 37 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 31. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent
reasonable compensation for all services rendered by it hereunder
and, from time to time, on demand of the Rights Agent, its
reasonable expenses and counsel fees and disbursements and other
disbursements incurred in the administration and execution of
this Agreement and the exercise and performance of its duties
hereunder. The Company also agrees to indemnify the Rights Agent
for, and to hold it harmless against, any loss, liability or
expense, incurred without negligence, bad faith or willful
misconduct on the part of the Rights Agent, for anything done or
omitted by the Rights Agent in connection with the acceptance and
administration of this Agreement, including the costs and
expenses of defending against any claim of liability in the
premises. The indemnification provided for hereunder shall
survive the expiration of the Rights and the termination of this
Agreement.
(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, endorse-
ment, 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 32. Merger or Consolidation or Change of Name of
Right Agents.
(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 provisions of
Section 34 hereof. In case at the time such successor Rights
Agent shall succeed to the agency created by this Agreement, any
of the Rights Certificates shall have been countersigned but not
delivered, any such successor Rights Agent may adopt the
countersignature of a predecessor Rights Agent and deliver such
Rights Certificates so countersigned; and in case at that time
any of the Rights Certificates shall not have been countersigned,
any successor Rights Agent may countersign such Rights
Certificates either in the name of the predecessor or in the name
of the successor Rights Agent; and in all such cases such Rights
Certificates shall have the full force provided in the Rights
Certificates and in this Agreement.
(b) In case at any time the name of the Rights Agent
shall be changed and at such time any of the Rights Certificates
shall have been countersigned but not delivered, the Rights Agent
may adopt the 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 33. Duties of Rights Agent. The Rights Agent
undertakes the duties and obligations imposed by this Agreement
upon the following terms and conditions, by all of which the
Company and the holders of Rights Certificates, by their
acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel
(who may be legal counsel for the Company), and the opinion of
such counsel shall be full and complete authorization and
protection to the Rights Agent as to any action taken or omitted
by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under
this Agreement the Rights Agent shall deem it necessary or
desirable that any fact or matter (including, without limitation,
the identity of any Acquiring Person or Adverse Person and the
determination of it current market price") be proved or
established by the Company prior to taking or suffering any
action hereunder, such fact or matter (unless other evidence in
respect thereof be herein specifically prescribed) may be deemed
to be conclusively proved and established by a certificate signed
by the Chairman of the Board, the President, any Vice President,
the Treasurer, any Assistant Treasurer, the Corporate Secretary
or any Assistant Secretary of the Company and delivered to the
Rights. Agent; and such certificate shall be full authorization
to the Rights Agent for any action taken or suffered in good
faith by it under the provisions of this Agreement in reliance
upon such certificate.
(c) The Rights Agent shall be liable hereunder only for
its own negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by
reason of 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 contained in this Agreement
or in any Rights Certificate; nor shall it be responsible for any
adjustment required under the provisions of Section 24 or Section
26 hereof or responsible for the manner, method or amount of any
such adjustment or the ascertaining of the existence of facts
that would require any such adjustment (except with respect to
the exercise of Rights evidenced by Rights Certificates after
receipt of the certificate described in Section 25 hereof); 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 Corporate Secretary, any Assistant
Secretary, the Treasurer or any Assistant Treasurer of the
Company, and to apply to such officers for advice or instructions
in connection with its duties, and it shall not be liable for any
action taken or suffered to be taken by it in good faith in
accordance with instructions of any such officer. Any application
by the Rights Agent for written instructions from the Company
may, at the option of the Rights Agent, set forth in writing any
action proposed to be taken or omitted by the Rights Agent under
this Agreement and the date on and/or after which such action
shall be taken or such omission shall be effective. The Rights
Agent shall not be liable for any action taken by, or omission
of, the Rights Agent in accordance with a proposal included in
such application on or after the dated specified in such
application (which date shall not be less than five Business Days
after the date any officer of the Company actually receives such
application, unless any such officer shall have consented in
writing to an earlier date) unless prior to taking any such
action (or the effective date in the case of an omission), the
Rights Agent shall have received written instructions in response
to such application specifying the action to be taken or omitted.
(h) The Rights Agent and any stockholder, director,
officer or employee of the Rights Agent may buy, sell or deal in
any of the Rights or other securities of the Company or become
pecuniarily interested in any transaction in which the Company
may be interested, or contract with or lend money to the Company
or otherwise act as fully and freely as though it were not Rights
Agent under this Agreement. Nothing herein shall preclude the
Rights Agent from acting in any other capacity for the Company or
for any other legal entity.
(i) The Rights Agent may execute and exercise any of
the rights or powers hereby vested in it or perform any duty
hereunder either itself or by or through its attorneys or agents,
and the Rights Agent shall not be answerable or accountable for
any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such
act, default, neglect or misconduct; Provided, 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 Certificate
surrendered to the Rights Agent for exercise or transfer, the
certificate attached to the form of assignment or form of
election to purchase, as the case may be, has 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.
(l) The Rights Agent shall not be required to take
notice or be deemed to have notice of any fact, event or
determination (including the occurrence of a section 24(a)(ii)
Event) under this Agreement unless and until the Rights Agent
shall be specifically notified in writing by the Company of such
fact, event or determination.
Section 34. 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 Certifi-
cate may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor Rights Agent,
whether appointed by the Company or by such a court, shall be (a)
a corporation organized and doing business under the laws of the
United States or of the State of New York or the Commonwealth of
Massachusetts (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 New York or the Commonwealth of
Massachusetts), in good standing, having a principal office in
the State of New York or the Common laws to exercise corporate
trust or stock transfer powers and is subject to supervision or
examination by federal or state authority and which has at the
time of its appointment as Rights Agent a combined capital and
surplus of at least $50,000,000 or (b) an Affiliate of a corpora-
tion described in clause (a) of this sentence. After appointment,
the successor Rights Agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the
predecessor Rights Agent shall deliver and transfer to the
successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Not later than
the effective date of any such Appointment, the Company shall
file notice thereof in writing with the predecessor Rights Agent
and each transfer agent of the Common 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 34, 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 35. 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, granted or awarded as of the Distribution Date, 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 36. Redemption and Termination.
(a) The Board of Directors of the Company may, at its option, at
any time prior
of (i) the close of business on the tenth day following the Stock
Acquisition Date (or, if the Stock Acquisition Date shall have
occurred prior to the Record Date, the close of business on the
tenth day following the Record 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 amount
may be appropriately adjusted to reflect any stock split, stock
dividend or similar transaction occurring after the date hereof
(such redemption price being hereinafter referred to as the
"Redemption Price"). Notwithstanding the foregoing, the Board of
Directors may not redeem any Rights following a determination
pursuant to Section 24(a (ii)(B) that any Person is an Adverse
Person. Notwithstanding anything contained in this Agreement to
the contrary, the Rights shall not be exercisable after the first
occurrence of a Section 24(a)(ii) Event until such time as the
Company's right of redemption hereunder has expired. The Company
may, at its option, pay the Redemption Price in cash, shares of
Common Stock (based on the "current market price", as defined in
Section 24(d)(i) hereof, of the Common Stock at the time of
redemption) or any other form of consideration deemed appropriate
by the Board of Directors.
(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.
Section 37. 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 subdivision 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 24(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, cash flow 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 24(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 38 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.
(b) In case any of the events set forth in Section
24(a)(ii) hereof shall occur, then, in any such case, (i) the
Company shall as soon as practicable thereafter give to each
holder of a Rights Certificate, to the extent feasible and in
accordance with Section 38 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 24 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 38. Notices. Notices or demands authorized 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:
The Hartford Steam Boiler
Inspection and Insurance Company
One State Street
Hartford, Connecticut 06102
Attention: Corporate Secretary
Subject to the provisions of Section 34, 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:
The First National Bank of Boston
P.O. Box 1865
Boston, Massachusetts 02105
Attention: Shareholder Services Division
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.
Section 39. Supplements and Amendments. Prior to the
Distribution Date and subject to the penultimate sentence of this
Section 39, 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 39, 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 (other than an Acquiring Person, an Adverse Person
or an Affiliate or Associate of an Acquiring Person or an Adverse
Person); provided, this Agreement may not be supplemented 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 39, 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 Depositary
Receipts for which a Right is exercisable. 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 40. Successors. All the covenants and provisions of
this Agreement by or for the benefit of the Company or the Rights
Agent shall bind and inure to the benefit of their respective
successors and assigns hereunder.
Section 41. Determinations and Actions by the Board of
Directors, etc. For all purposes of this agreement, any
calculation of the number of shares of Common Stock outstanding
at any particular time, including for purposes of determining the
particular percentage of such outstanding shares of Common Stock
of which any Person is the Beneficial Owner, shall be made in
accordance with the last sentence of Rule 13d-3(d)(1)(i) of the
General Rules and Regulations under the Exchange Act. The Board
of Directors of the Company (or, as set forth herein, certain
specified members thereof) shall have the exclusive power and
authority to administer this Agreement and to exercise all rights
and powers specifically granted to the Board (or, as set forth
herein, certain specified members thereof) or to the Company, or
as may be necessary or advisable in the administration of this
Agreement, including, without limitation, the right and power to
(i) interpret the provisions of this Agreement and (ii) make all
determinations deemed necessary or advisable for the
administration of this Agreement (including a determination to
redeem or not redeem the Rights or to amend the Agreement). 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 (or
as set forth herein certain specified members thereof) 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 to any liability to the holders of
the Rights.
Section 42. 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 Certifi-
cates (and, prior to the Distribution Date, registered holders of
the Common Stock).
Section 43. Severability. If any term, provision, covenant
or restriction of this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void or
unenforceable, the remainder of the terms, provisions, covenants
and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated;
provided, however, that notwithstanding anything in this
Agreement to the contrary, if any such term, provision, covenant
or restriction 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 36 hereof shall be reinstated and shall not expire until
the close of business on the tenth day following the date of such
determination by the Board of Directors.
Section 44. 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 Connecticut 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.
Section 45. Counterparts. This Agreement may be executed in
any number of counterparts and each of such counterparts shall
for all purposes be deemed to be an original, and all such
counterparts shall together constitute but one and the same
instrument.
Section 46. 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.
[ Seal ]
Attest: THE HARTFORD STEAM BOILER
INSPECTION AND INSURANCE
COMPANY
By /s/ Roberta A. O'Brien By /s/ John J. Kelley
Name: Roberta A. O'Brien Name: John J. Kelley
Title: Assistant Secretary Title: Corporate Secretary
[ Seal]
Attest:
THE FIRST NATIONAL
BANK OF BOSTON, as Rights Agent
By /s/ Kenyon Bissell By /s/ Darlene M. DioDato
Name: Kenyon Bissell Name: Darlene M. DioDato
Title: Assistant Vice President Title: Vice President
EXHIBIT A
FORM OF
CERTIFICATE OF DESIGNATION, PREFERENCES AND
RIGHTS OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
of
THE HARTFORD STEAM BOILER INSPECTION
AND INSURANCE COMPANY
Pursuant to Section 33-340 of the Connecticut Stock
Corporation Act
THE HARTFORD STEAM BOILER INSPECTION AND INSURANCE COMPANY, a
corporation organized and existing under and by virtue of the
laws of Connecticut (hereinafter called the "Corporation"),
pursuant to the provisions of Section 33-340 of the Connecticut
Stock Corporation Act, does by Wilson Wilde, its President, and
John J. Kelley, its Corporate Secretary, hereby certify that,
pursuant to authority expressly vested in the Board of Directors
of the Corporation by the provisions of its Charter, said Board
of Directors at a meeting duly called and held on November 28,
1988, duly adopted resolutions providing for the issuance of a
series of Preferred Stock, without par value, of the Corporation
and setting forth the voting powers, designation, preferences and
relative, participating, optional and other special rights of
such series and the qualifications, limitations and restrictions
of such rights, to the extent that the foregoing are not set
forth in the Charter of the Corporation, which resolutions are as
follows:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of this Corporation in accordance with the provisions
of its Charter, a series of Preferred Stock of the Corporation be
and it hereby is created, and that the designation and amount
thereof and the voting powers, preferences and relative,
participating, optional and other special rights of the shares of
such series, and the qualifications, limitations or restrictions
thereof are as follows:
Section 1. Designation and Amount. The shares of such series
shall be designated as "Series A Junior Participating Preferred
Stock" and the number of shares constituting such series shall be
250,000.
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the holders of
any shares of any series of Preferred Stock ranking prior and
superior to the shares of Series A Junior Participating Preferred
Stock with respect to dividends, the holders of shares of Series
A Junior Participating Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors out
of funds legally available for the purpose, quarterly dividends
payable in cash on the last business day of January, April, July
and October in each year (each such date being referred to herein
as a "Quarterly Dividend Payment Date ), commencing on the first
Quarterly Dividend Payment Date after the first issuance of a
share or fraction of a share of Series A Junior Participating
Preferred Stock, in an amount per share (rounded to the nearest
cent) equal to the greater of (a) $12.00 or (b) subject to the
provision for adjustment hereinafter set forth, 200 times the
aggregate per share amount of all cash dividends, and 200 times
the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions other than a dividend payable in
shares of Common Stock or a subdivision of the outstanding shares
of Common Stock (by reclassification or otherwise), declared on
the Common Stock, without par value, of the Corporation (the
"Common Stock") since the immediately preceding Quarterly
Dividend Payment Date, or, with respect to the first Quarterly
Dividend Payment Date,, since the first issuance of any share or
fraction of a share of Series A Junior Participating Preferred
Stock. In the event the Corporation shall at any time after
November 28, 1988 (the "Rights Declaration Date") (i) declare any
dividend on Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding Common Stock or (iii) combine the
outstanding Common Stock into a smaller number of shares, then in
each such case the amount to which holders of shares of Series A
Junior Participating Preferred Stock were entitled immediately
prior to such event under clause (b) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on
the Series A Junior Participating Preferred Stock as provided in
Paragraph (A) above immediately after it declares a dividend or
distribution on the Common Stock (other than a dividend payable
in shares of Common Stock); provided that, in the event no
dividend or distribution shall have been declared on the Common
Stock during the period between any Quarterly Dividend Payment
Date and the next subsequent Quarterly Dividend Payment Date, a
dividend of $12.00 per share on the Series A Junior Participating
Preferred Stock shall nevertheless be payable on such subsequent
Quarterly Dividend Payment Date.
(C) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series A Junior Participating Preferred
Stock from the Quarterly Dividend Payment Date next preceding the
date of issue of such shares of Series A Junior Participating
Preferred stock unless the date of issue of such shares is prior
to the record date for the first Quarterly Dividend Payment Date,
in which case dividends on such shares shall begin to accrue from
the date of issue of such shares or unless the date of issue is a
Quarterly Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series A
Junior Participating Preferred Stock entitled to receive a
quarterly dividend and before such Quarterly Dividend Payment
Date in either of which events such dividends shall begin to
accrue and be cumulative from such Quarterly Dividend Payment
Date. Accrued but unpaid dividends shall not bear interest.
Dividends paid on the shares of Series A Junior Participating
Preferred Stock in an amount less than the total amount of such
dividends at the time accrued and payable on such shares shall be
allocated pro rata on a share-by-share basis among all such
shares at the time outstanding. The Board of Directors may fix a
record date for the determination of holders of shares of Series
A Junior Participating Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which
record date shall be no more than 30 days prior to the date fixed
for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A
Junior Participating Preferred Stock shall have the following
voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth, each share of Series A Junior Participating Preferred
Stock shall entitle the holder thereof to 200 votes on all
matters submitted to a vote of the shareholders of the
Corporation. In the event the Corporation shall at any time after
the Rights Declaration Date (i) declare any dividend on Common
Stock payable in shares of Common Stock (ii) subdivide the
outstanding Common Stock, or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such case the
number of votes per share to which holders of shares of Series A
Junior Participating Preferred Stock were entitled immediately
prior to such event shall be adjusted by multiplying such number
by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
(B) Except as otherwise provided herein or by law, the holders of
shares of Series A Junior Participating Preferred Stock and the
holders of shares of Common Stock shall vote together as one
class on all matters submitted to a vote of shareholders of the
Corporation.
(C) (i) If at any time dividends on any Series A Junior
Participating Preferred Stock shall be in arrears in an amount
equal to six (6) quarterly dividends thereon, the occurrence' of
such contingency shall mark the beginning of a period (herein
called a "default period") which shall extend until such time
when all accrued and unpaid dividends for all previous quarterly
dividend periods and for the current quarterly dividend period on
all shares of Series A Junior Participating Preferred Stock then
outstanding shall have been declared and paid or set apart for
payment. During each default period, all holders of Preferred
Stock (including holders of the Series A Junior Participating
Preferred Stock) with dividends in arrears in an amount equal to
six (6) quarterly dividends thereon, voting as a class,
irrespective of series, shall have the right to elect two (2)
Directors.
(ii) During any default period, such voting right of the holders
of Series A Junior Participating Preferred Stock may be exercised
initially at a special meeting called pursuant to subparagraph
(iii) of this Section 3(C) or at any annual meeting of
shareholders, and thereafter at annual meetings of shareholders,
provided that neither such voting right nor the right of the
holders of any other series of Preferred Stock, if any, to
increase, in certain cases, the authorized number of Directors
shall be exercised unless the holders of ten percent (10%) in
number of shares of Preferred Stock outstanding shall be present
in person or by proxy. The absence of a quorum of the holders of
Common Stock shall not affect the exercise by the holders of
Preferred Stock of such voting right. At any meeting at which the
holders of Preferred Stock shall exercise such voting right
initially during an existing default period, they shall have the
right, voting as a class, to elect Directors to fill such
vacancies, if any in the Board of Directors as may then exist up
to two (2) Directors or, if such right is exercised at an annual
meeting, to elect two (2) Directors. If the number which may be
so elected at any special meeting does not amount to the required
number, the holders of the Preferred Stock shall have the right
to make such increase in the number of Directors as shall be
necessary to permit the election by them of the required number.
After the holders of the Preferred Stock shall have exercised
their right to elect Directors in any default period and during
the continuance of such period, the number of Directors shall not
be increased or decreased except by vote of the holders of
Preferred Stock as herein provided or pursuant to the rights of
any equity securities ranking senior to or pari passu with the
Series A Junior Participating Preferred Stock.
(iii) Unless the holders of Preferred Stock shall, during an
existing default period, have previously exercised their right to
elect Directors, the Board of Directors may order, or any
shareholder or shareholders owning in the aggregate not less than
ten percent (10%) of the total number of shares of Preferred
Stock outstanding, irrespective of series, may request, the
calling of special meeting of the holders of Preferred Stock,
which meeting shall thereupon be called by the President, a
Vice-President or the Secretary of the Corporation. Notice of
such meeting and of any annual meeting at which holders of
Preferred Stock are entitled to vote pursuant to this paragraph
(C)(iii) shall be given to each holder of record of Preferred
Stock by mailing a copy of such notice to him at his last address
as the same appears on the books of the Corporation. Such meeting
shall be called for a time not earlier than 20 days and not later
than 60 days after such order or request or in default of the
calling of such meeting within 60 days after such order or
request, such meeting may be called on similar notice by any
shareholder or shareholders owning in the aggregate not less than
ten percent (10%) of the total number of shares of Preferred
Stock outstanding. Notwithstanding the provisions of this
paragraph (C)(iii), no such special meeting shall be called
during the period within 60 days immediately preceding the date
fixed for the next annual meeting of the shareholders.
(iv) In any default period, the holders of Common Stock, and
other classes of stock of the Corporation if applicable, shall
continue to be entitled to elect the whole number of Directors
until the holders of Preferred Stock shall have exercised their
right to elect two (2) Directors voting as a class, after the
exercise of which right (x) the Directors so elected by the hold-
ers of Preferred Stock shall continue in office until their
successors shall have been elected by such holders or until the
expiration of the default period and (y) any vacancy in the Board
of Directors may (except as provided in paragraph (C)(ii) of this
Section 3.5)be filled by vote of a majority of the remaining
Directors theretofore elected by the holders of the class of
stock which elected the Director whose office shall have become
vacant. References in this paragraph (C) to Directors elected by
the holders of a particular class of stock shall include
Directors elected by such Directors to fill vacancies as provided
in clause (y) of the foregoing sentence.
(v) Immediately upon the expiration of a default period,(x) the
right of the holders of Preferred Stock as a class to elect
Directors shall cease, (y) the term of any Directors elected by
the holders of Preferred Stock as a class shall terminate and (z)
the number of Directors shall be such number as may be provided
for in the certificate of incorporation or by-laws irrespective
of any increase made pursuant to the provisions of paragraph
(C)(ii) of this Section 3 (such number being subject, however, to
change thereafter in any manner provided by law or in the
certificate of incorporation or by-laws). Any vacancies in the
Board of Directors effected by the provisions of clauses (y) and
(z) in the preceding sentence may be filled by a majority of the
remaining Directors.
(D) Except as set forth herein, holders of Series A Junior
Participating Preferred Stock shall have no special voting rights
and their consent shall not be required (except to the extent
they are entitled to vote with holders of Common Stock as set
forth herein) for taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Junior Participating
Preferred Stock as provided in Section 2 are in arrears,
thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A
Junior Participating Preferred Stock outstanding shall have been
paid in full, the Corporation shall not
(i) declare or pay dividends on, make any other distributions on,
or redeem or purchase or otherwise acquire for consideration any
shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Junior
Participating Preferred Stock;
(ii) declare or pay dividends on or make any other distributions
on any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with
the Series A Junior Participating Preferred Stock, except
dividends paid ratably on the Series A Junior Participating
Preferred Stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts to which
the holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking on a parity (either as to dividends
or upon liquidation, dissolution or winding up) with the Series A
Junior Participating Preferred Stock, provided that the
Corporation may at any time redeem, purchase or otherwise acquire
shares of any such parity stock in exchange for shares of any
stock of the Corporation ranking junior (either as to dividends
or upon dissolution, liquidation or winding up) to the Series A
Junior Participating Preferred Stock;
(iv) purchase or otherwise acquire for consideration any shares
of Series A Junior Participating Preferred Stock, or any shares
of stock ranking on a parity with the Series A Junior
Participating-Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as determined
by the Board of Directors) to all holders of such shares upon
such terms as the Board of Directors, after consideration of the
respective annual dividend rates and other relative rights and
preferences of the respective series and classes, shall determine
in good faith will result in fair and equitable treatment among
the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration
any shares of stock of the Corporation unless the Corporation
could, under paragraph (A) of this Section 4, purchase or
otherwise acquire such shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A Junior
Participating Preferred Stock purchased or otherwise acquired by
the Corporation in any manner whatsoever shall be retired and
cancelled promptly after the acquisition thereof. All such shares
shall upon their cancellation become authorized but unissued
shares of Preferred Stock and may be reissued as part of a new
series of Preferred Stock to be created by resolution or
resolutions of the Board of Directors, subject to the conditions
and restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. (A) Upon any
liquidation (voluntary or otherwise), dissolution or winding up
of the Corporation, no distribution shall be made to the holders
of shares of stock ranking junior (either as to dividends or upon
liquidation, dissolution or winding up) to the Series A Junior
Participating Preferred Stock unless, prior thereto, the holders
of shares of Series A Junior Participating Preferred Stock shall
have received $200 per share, plus an amount equal to accrued and
unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment (the "Series A Liquidation
Preference"). Following the payment of the full amount of the
Series A Liquidation Preference, no additional distributions
shall be made to the holders of shares of Series A Junior Par-
ticipating Preferred Stock unless, prior thereto, the holders of
shares of Common Stock shall have received an amount per share
(the "Common Adjustment") equal to the quotient obtained by
dividing (i) the Series A Liquidation Preference by (ii) 200 (as
appropriately adjusted as set forth in paragraph (C) below to
reflect such events as stock splits, stock dividends and
recapitalizations with respect to the Common Stock) (such number
in clause (ii), the "Adjustment Number"). Following the payment
of the full amount of the Series A Liquidation Preference and the
Common Adjustment in respect of all outstanding shares of Series
A Junior Participating Preferred Stock and Common Stock,
respectively, holders of Series A Junior Participating Preferred
Stock and holders of shares of Common Stock shall receive their
ratable and proportionate share of the remaining assets to be
distributed in the ratio of the Adjustment Number to 1 with
respect to such Preferred Stock and Common Stock, on a per share
basis, respectively.
(B) In the event, however that there are not sufficient assets
available to permit payment in full of the Series A Liquidation
Preference and the liquidation preferences of all other series of
preferred stocks if any, which rank on a parity with the Series A
Junior Participating Preferred Stock, then such remaining assets
shall be distributed ratably to the holders of such parity shares
in proportion to their respective liquidation preferences. In the
event, however, that there are not sufficient assets available to
permit payment in full of the Common Adjustment then such
remaining assets shall be distributed ratably to the holders of
Common Stock.
(C) In the event the Corporation shall at any time after the
Rights Declaration Date (i) declare any dividend on Common Stock
payable in shares of Common Stock, (ii) subdivide the outstanding
Common Stock or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the Adjustment
Number in effect immediately prior to such event shall be
adjusted by multiplying such Adjustment Number by a fraction the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 7. Consolidation, Merger. etc. In case the Corporation
shall enter into any consolidation, merger, combination or other
transaction in which the shares of Common Stock are exchanged for
or changed into other stock or securities, cash and/or any other
property, then in any such case the shares of Series A Junior
Participating Preferred Stock shall at the same time be similarly
exchanged or changed in an amount per share (subject to the
provision for adjustment hereinafter set forth) equal to 200
times the aggregate amount of stock, securities, cash and/or any
other property (payable in kind), as the case may be, into which
or for which each share of Common Stock is changed or exchanged.
In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock payable
in shares of Common Stock, (ii) subdivide the outstanding Common
Stock or (iii) combine the outstanding Common Stock into a
smaller number of shares, then in each such case the amount set
forth in the preceding sentence with respect to the exchange or
change of shares of Series A Junior Participating Preferred Stock
shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 8. Optional Redemption. (A) The Corporation shall have
the option to redeem the whole or any part of the Series A Junior
Participating Preferred Stock at any time at a redemption price
equal to, subject to the provision for adjustment hereinafter set
forth, 200 times the "current per share market price" of the
Common Stock on the date of the mailing of the notice of
redemption, together with unpaid accumulated dividends to the
date of such redemption. In the event the Corporation shall at
any time after the Rights Declaration Date (i) declare any
dividend on Common Stock payable in shares of Common Stock, (ii)
subdivide the outstanding Common Stock, (iii) combine the
outstanding Common Stock into a smaller number of shares or (iv)
issue any shares by reclassification of its shares of Common
Stock, then in each such case the amount to which holders of
shares of Series A Junior Participating Preferred Stock shall be
otherwise entitled immediately prior to such event under the
immediately preceding sentence shall be adjusted by multiplying
such amount by a fraction the numerator of which shall be the
number of shares of Common Stock outstanding immediately after
such event and the denominator of which shall be the number of
shares of Common Stock that shall have been outstanding
immediately prior to such event. The "current per share market
price" on any date shall be deemed to be the average of the
closing prices per share of such Common Stock for the 10
consecutive Trading Days (as such term is hereinafter defined)
immediately prior to such date. The closing price for each day
shall be the last sale price, regular way, or, in case no such
sale shall take 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 Common Stock shall not be listed or admitted
to trading on the New York Stock Exchange, as reported in the
principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the principal
national securities exchange on which the Common Stock shall not
be listed or admitted to trading or, if the Common Stock shall
not be 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 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 Common Stock shall
not be 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 Common Stock selected by the
Board of Directors of the Corporation. If on such date no such
market maker shall be making a market in the Common Stock, the
fair value of the Common Stock on such date as determined in good
faith by the Board of Directors of the Corporation shall be used.
The term "Trading Day" shall mean a day on which the principal
national securities exchange on which the Common Stock shall be
listed or admitted to trading shall be open for the transaction
of business or, if the Common Stock shall not be listed or
admitted to trading on any national securities exchange, a
Monday, Tuesday, Wednesday, Thursday or Friday on which banking
institutions in the State of New York shall not be authorized or
obligated by law or executive order to close.
(B) Notice of any such redemption shall be given by mailing to
the holders of the Series A Junior Participating Preferred Stock
a notice of such redemption, first class postage prepaid, not
later than the thirtieth day and not earlier than the
sixtieth-day before the date fixed for redemption, at their last
address as the same shall appear upon the books of the Corpora-
tion. Any notice which shall be mailed in the manner herein
provided shall be conclusively presumed to have been duly given,
whether or not the stockholder shall have received such notice,
and failure duly to give such notice by mail, or any defect in
such notice, to any holder of Series A Junior Participating
Preferred Stock shall not affect the validity of the proceedings
for the redemption of such Series A Junior Participating Pre-
ferred Stock.
(C) If less than all the outstanding shares of the Series A
Junior Participating Preferred Stock are to be redeemed by the
Corporation, the number of shares to be redeemed shall be
determined by the Board of Directors and the shares to be
redeemed shall be determined by lot or pro rata or in such fair
and equitable other manner as may be prescribed by resolution of
the Board of Directors.
(D) The notice of redemption to each holder of Series A Junior
Participating Preferred Stock shall specify (a) the number of
shares of Series A Junior Participating Preferred Stock of such
holder to be redeemed, (b) the date fixed for redemption, (c) the
redemption price and (d) the place of payment of the redemption
price.
(E) If any such notice of redemption shall have been duly given
or if the corporation shall have given to the bank or trust
company hereinafter referred to irrevocable written authorization
promptly to give or complete such notice, and if on or before the
redemption date specified therein the funds necessary for such
redemption shall have been deposited by the Corporation. with the
bank or trust company designated in such notice, doing business
in the United States of America and having a capital, surplus and
undivided profits aggregating at least $25,000,000 according to
its last published statement of condition, in trust for the
benefit of the holders of Series A Junior Participating Preferred
Stock called for redemption, then, notwithstanding that any
certificate for such shares so called for redemption shall not
have been surrendered for cancellation, from and after the time
of such deposit all such shares called for redemption shall no
longer be deemed outstanding, all rights with respect to such
shares shall no longer be deemed outstanding and all rights with
respect to such shares shall forthwith cease and terminate,
except the right of the holders thereof to receive from such bank
or trust company at any time after the time of such deposit the
funds so deposited, without interest, the right to exercise, up
to the close of business on the fifth day before the date fixed
for redemption, all privileges of conversion or exchange if any.
In case less than all the shares represented by any surrendered
certificate shall be redeemed, a new certificate shall be issued
representing the unredeemed shares Any interest accrued on such
funds so deposited shall be paid to the Corporation from time to
time. Any funds so deposited and unclaimed at the end of six
years from such redemption date shall be repaid to the
Corporation, after which the holders of shares of Series A Junior
Participating Preferred Stock called for redemption shall look
only to the Corporation for payment thereof; provided, however,
that any funds so deposited which shall not be required for
redemption because of the exercise of any privilege of conversion
or exchange subsequent to the date of deposit shall be repaid to
the Corporation forthwith.
Section 9. Ranking. The Series A Junior Participating Preferred
Stock shall rank junior to all other series of the Corporation's
Preferred Stock as to the payment of dividends and the
distribution of assets, unless the terms of any such series shall
provide otherwise.
Section 10. Amendment. The Charter of the Corporation shall not
be further amended in any manner which would materially alter or
change the powers, preferences or special rights of the Series A
Junior Participating Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of at least
a majority of the outstanding shares of Series A Junior
Participating Preferred Stock, voting separately as a class.
RESOLVED, FURTHER, that the proper officers of the Corporation be
and they are hereby authorized and directed,jointly and
severally, to prepare, execute and file a certificate setting
forth a copy of the foregoing resolutions and to execute any and
all other documents and take any and all other steps necessary or
appropriate in order to comply with the laws of the State of
Connecticut and effectuate the purposes of said resolutions.
IN WITNESS WHEREOF, HARTFORD STEAM BOILER INSPECTION AND
INSURANCE COMPANY has caused this Certificate to be signed in its
name by Wilson Wilde, its President, and John J. Kelley, its
Corporate Secretary, and its corporate seal to be hereunto
affixed, as of this 28th day of November, 1988.
THE HARTFORD STEAM BOILER INSPECTION AND INSURANCE COMPANY
[CORPORATE SEAL]
/s/ Wilson Wilde
Name: Wilson Wilde
Title: President
Attest:
/s/ John J. Kelley
Name: John J. Kelley
Title: Corporate Secretary
STATE OF CONNECTICUT)
) ss,:
COUNTY OF HARTFORD )
On this 28th day of November, 1988, before me, , a
Notary Public in and for said County and State, residing therein,
duly commissioned and sworn, personally appeared Wilson Wilde and
John J. Kelley known to me or proved to me on the basis of
satisfactory evidence to be the President and the Assistant
Secretary, respectively, of THE HARTFORD STEAM BOILER INSPECTION
AND INSURANCE COMPANY, a Connecticut corporation, the Corporation
that executed the foregoing Certificate of Designation and
Preferences, and upon oath did severally depose and say, each for
himself and not for the other, that he is the officer of said
Corporation as above designated; that he is acquainted with the
seal of said Corporation and that the seal affixed to said
instrument is the corporate seal of said Corporation; that the
signatures to said instrument were made by said officers of said
Corporation as indicated after said signatures; and that the said
Corporation executed the said instrument freely and voluntarily
and for the uses and purposes therein mentioned.
IN WITNESS WHEREOF, I have hereunto subscribed my name and
affixed my official seal at my office in the County of Hartford,
State of Connecticut, on the day and year in this certificate
first above written.
Notary Public in and for the
County of Hartford State of Connecticut
(SEAL)
My Commission Expires:
EXHIBIT B
[FORM OF FACE OF DEPOSITARY RECEIPT]
DEPOSITARY RECEIPT FOR SERIES A JUNIOR PARTICIPATING PREFERRED
STOCK
of
THE HARTFORD STEAM BOILER INSPECTION AND INSURANCE COMPANY
Certificate No ...........
Depositary Preferred Shares
(Each such share being exchangeable for one two-hundredth of a
share of Series A Junior Participating Preferred Stock)
This certifies that or registered assigns, is the
registered owner of Depositary Preferred Shares, each of
which is exchangeable for one two-hundredth of a share of Series
A Junior Participating Preferred Stock (the "Preferred Stock") of
The Hartford Steam Boiler Inspection and Insurance Company, a
Connecticut corporation (the "Company"), upon presentation and
surrender of this Depositary Receipt with the Form of Election to
Exercise duly executed. Certificates representing the shares of
Preferred Stock have been deposited by the Company at the office
of The First National Bank of Boston (the "Rights Agent")
designated for such purpose. The Depositary Receipts, of which
this Depositary
Receipt is one ("Depositary Receipts"), are issued upon the
terms and conditions set forth in the Rights Agreement, dated as
of November 28, 1988 (the "Rights Agreement"), by and between the
Company and the Rights Agent.
This Depositary Receipt is subject to all of the terms,
provisions and conditions of the Rights Agreement, which terms,
provisions and conditions are hereby incorporated herein by
reference and made a part hereof and to which Rights Agreement
reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities
hereunder of the Rights Agent, the Company and the holders of the
Depositary Receipts. Copies of the Rights Agreement are on file
at the office of the Company and are also available upon written
request to the Company.
This Depositary Receipt shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Rights
Agent.
WITNESS the facsimile signature of the proper
officers of the Company and its corporate seal.
Dated as of 19
ATTEST:
Secretary
Countersigned:
THE FIRST NATIONAL BANK OF BOSTON, as Rights Agent
By
Authorized Signature
By
Title:
[FORM OF REVERSE OF DEPOSITARY RECEIPT]
The following summary of certain provisions of the Rights
Agreement is subject to the detailed provisions thereof, to which
reference is hereby made.
1. Surrender of Depositary Receipts and Withdrawal of Stock. Upon
surrender of this Depositary Receipt to the Rights Agent at its
office designated for such purpose, and subject to the provisions
of the Rights Agreement, the holder hereof is entitled to
delivery to him, or upon his order, of the Preferred Stock and
any money and other property at the time represented thereby;
provided, however, that in the event fractional shares of
Preferred Stock would be created, the Rights Agent shall deliver
the maximum number of whole shares of Preferred Stock, if any,
and a new Depositary Receipt evidencing the Preferred Stock which
shall be exchangeable for the Preferred Stock not so withdrawn.
Upon the happening of any event referred to in paragraph 10 below
and the surrender of this Depositary Receipt to the Rights Agent,
the holder hereof is entitled to delivery to him, or upon his
order, of the new securities into which the Preferred Stock has
been changed or which have been received by the Rights Agent in
exchange for the Preferred Stock.
2. Transfers, Split-ups, Combinations. This
Depositary Receipt is transferable on the books of the Rights
Agent upon surrender of this Depositary Receipt to the Rights
Agent, properly endorsed or accompanied by a properly executed
instrument of transfer, and upon such transfer the Rights Agent
shall sign and deliver a Depositary Receipt to or upon the order
of the person entitled thereto, as provided in the Rights
Agreement. This Depositary Receipt may be split into other
Depositary Receipts or combined with other Depositary Receipts
into one Depositary Receipt, representing the same aggregate
number of shares of Depositary Preferred Stock as the Depositary
Receipt or Depositary Receipts surrendered.
3. Suspension of Delivery, Transfer, etc. The delivery of this
Depositary Receipt in exchange for Preferred Stock or the
transfer, surrender or exchange of this Depositary Receipt, may
be suspended during any period when the register of stockholders
of the Company is closed or if any such action is deemed
necessary or advisable by the Rights Agent or the Company at any
time or from time to time because of any requirement of law or of
any government or governmental body or commission or stock
exchange, or under any provision of the Rights Agreement.
4. Payment of Taxes or Other Governmental
Charges. If any tax or other governmental charge shall become
payable by or on behalf of the Rights Agent with respect to this
Depositary Receipt, such tax (including transfer taxes, if any)
or governmental charge shall be payable by the holder hereof.
Transfer of this Depositary Receipt, or any delivery of Preferred
Stock exchangeable for this Depositary Receipt, may be refused
until such payment is made, and any dividends or other
distributions may be withheld, or any part or all of the
Preferred Stock exchangeable for this Depositary Receipt and not
theretofore sold may be sold for the account of the holder
hereof, and such dividends or other distributions or the proceeds
of any such sale may be applied in any payment of such tax or
other governmental charge holder of this Depositary Receipt
remaining liable for any deficiency.
5. Amendment. The form of the Depositary Receipt and any
provisions of the Rights Agreement may be amended as provided in
the Rights Agreement.
6. Title to Receipts. It is a condition of this Depositary
Receipt, and every successive holder hereof by accepting or
holding the same consents and agrees, that this Depositary
Receipt (and the Depositary Preferred Shares evidenced hereby),
when properly endorsed or accompanied by a properly executed
instrument of transfer, is transferable by delivery with the same
effect as in the case of a negotiable instrument; provided,
however, that until this Depositary Receipt shall be transferred
on the books of the Rights Agent the Rights Agent may,
notwithstanding any notice to the contrary, treat the record
holder hereof at such time as the absolute owner hereof for the
purpose of determining the person entitled to distribution of
dividends or other distributions or to any notice provided for
the Rights Agreement, and for all other purposes.
7. Dividends and Distributions. Whenever the Rights Agent
receives any cash dividend or other cash distribution on the
Preferred Stock, the Rights Agent will, subject to the provisions
of the Rights Agreement, make such distribution to the Depositary
Receipt holders as nearly as practicable in proportion to the
number of shares of Depositary Preferred Stock held by them;
provided, however, that the amount distributed will be reduced by
any amounts required to be withheld by the Company or the Rights
Agent on account of taxes. Other distributions received on the
Preferred Stock may be distributed to holders of Depositary
Receipts as provided in the Rights Agreement.
8. Fixing of Record Date. Whenever any cash dividend or other
cash distribution shall become payable or any distribution other
than cash shall be made, or whenever rights, preferences or
privileges shall be offered, with respect to the Preferred Stock,
or whenever the Rights Agent shall receive notice of any meeting
at which holders of Preferred Stock are entitled to vote or of
which holders of Preferred Stock are entitled to notice, the
Rights Agent shall fix a record date, which shall be the record
date fixed by the Company with respect to the Preferred Stock,
and, in accordance with the Rights Agreement, shall send notice
of such record date to the record holders of Depositary Receipts.
9. Voting Rights. Upon receipt of notice of any meeting at which
the holders of Preferred Stock are entitled to vote, the Rights
Agent shall include in the notice to the record holders of
Depositary Receipts referred to in the immediately preceding
paragraph: (a) such information as is contained in the notice of
meeting received by the Rights Agent; (b) a statement that the
holders of Depositary Receipts at the close of business on the
record date specified therein will be entitled, subject to any
applicable provisions of law and of the Company's Charter, to
instruct the Rights Agent as to the
exercise of the voting rights pertaining to the amount of
Preferred Stock represented by their respective shares of
Depositary Preferred Stock; and (c) a brief statement as to the
manner in which such instructions may be given. Upon the written
request of a holder of a Depositary Receipt on such record date,
the Rights Agent shall endeavor insofar as practicable to vote or
cause to be voted the amount of Preferred Stock exchangeable for
such Depositary Receipt in accordance with the instructions set
forth in such request. In the absence of specific instructions
from the holder of a Depositary Receipt, the Rights Agent will
abstain from voting to the extent of the Preferred Stock
underlying such Depositary Receipt.
10. Changes Affecting Deposited Securities.
Upon any change in par or stated value, split-up, consolidation
or any other reclassification of the Preferred Stock or upon any
recapitalization, reorganization, merger, consolidation or sale
of assets affecting the Company or to which it is a party, the
Rights Agent shall, with the approval of the Company and in such
manner as the Rights Agent may deem equitable, treat any
securities into which the Preferred Stock shall be changed or
which shall be received by the Rights Agent in exchange for or in
conversion of or in respect of the Preferred Stock as new
deposited securities under the Rights Agreement, and Depositary
Receipts then outstanding shall thenceforth be exchangeable for
the new securities into which the Preferred Stock shall be
changed or which are so received in exchange or conversion. In
any such case, the Rights Agent may in its discretion, with the
approval of the Company, execute and deliver additional
Depositary Receipts or may call for the surrender of outstanding
Depositary Receipts to be exchanged for new Depositary Receipts
specifically describing such new deposited securities.
FORM OF ASSIGNMENT
(To be executed by the registered holder if such holder desires
to transfer the Depositary Receipt.)
FOR VALUE RECEIVED
hereby sells, assigns and transfers unto
(Please print name and address of transferee)
this Depositary Receipt, together with all right, title and
interest therein, and does hereby irrevocably constitute and
appoint Attorney, to transfer the within
Depositary Receipt on the books of the withinnamed Company, with
full power of substitution.
Date: , 19
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Assignment must correspond to the
name as written upon the face of this Depositary Receipt in every
particular, without alteration or enlargement or any change
whatsoever.
FORM OF ELECTION TO EXERCISE
(To be executed if holder desires to exercise Depositary
Preferred Shares represented by the Depositary Receipt.)
To: THE HARTFORD STEAM BOILER INSPECTION AND INSURANCE COMPANY
The undersigned hereby irrevocably elects to exercise
Depositary Receipts represented by this Depositary Receipt
Certificate to receive the shares of Depositary Preferred Stock
issuable upon the exercise of the Depositary Receipt (or such
other securities of the Company or of any other person which may
be issuable upon the exercise of Depositary Receipt) and requests
that certificate for such shares be issued in the name of:
Please insert social security or other identifying number
(Please print name and address
If such number of Depositary Receipts shall not be all the
Depositary Receipts evidenced by this Depositary Receipt
Certificate, a new Depositary Receipt Certificate for the balance
of such Depositary Receipts shall be registered in the name of
and delivered to:
Please insert social security or other identifying number
(Please print name and address)
Dated: , 19
signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Election to Exercise must
correspond to the name as written upon the face of this
Depositary Receipt Certificate in every particular, without
alteration or enlargement or any change whatsoever.
Exhibit C
[Form of Rights Certificate]
Certificate No. R- Rights
NOT EXERCISABLE AFTER NOVEMBER 28, 1998 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 OR AN ADVERSE PERSON
(AS SUCH TERMS ARE 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 ADVERSE PERSON OR AN AFFILIATE OR ASSOCIATE OF AN
ACQUIRING PERSON OR AN ADVERSE 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 RIGHTS
AGREEMENT.*
*The portion of the legend in brackets shall be inserted only if
applicable and shall replace the preceding sentence.
Rights Certificate
THE HARTFORD STEAM BOILER INSPECTION
AND INSURANCE COMPANY
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
November 28, 1988 (the "Rights Agreement") between The Hartford
Steam Boiler Inspection and Insurance Company, a Connecticut
corporation (the "Company"), and The First National Bank of
Boston, a national banking association (the "Rights Agent"), to
purchase from the Company at any time prior to 5:00 P.M. (Boston
time) on November 28, 1998 at the office or offices of the Rights
Agent designated for such purpose, or its successors as Rights
Agent, one Depositary Receipt (a "Depositary Receipt") which is
exchangeable into one two-hundredth of a fully paid,
nonassessable share of Series A Junior Participating Preferred
Stock, without par value (the "Preferred Stock"), of the Company
at a purchase price of $110.00 per Depositary Receipt (the
"Purchase Price"), upon presentation and surrender of this Rights
Certificate with the Form of Election to Purchase and related
Certificate duly executed. The number of Rights evidenced by this
Rights Certificate (and the number of Depositary Receipts which
may be purchased upon exercise thereof) set forth above, and the
Purchase Price per Depositary Receipt set forth above, are the
number and Purchase Price as of November 28, 1988. All terms used
and not defined herein shall have the meaning set forth in the
Rights Agreement.
Upon the occurrence of a Section 24(a)(ii) Event if the Rights
evidenced by this Rights Certificate are beneficially owned by
(i) an Acquiring Person, an Adverse Person or an Affiliate or
Associate of any such Person (as such terms are defined in the
Rights Agreement), (ii) a transferee of any such Acquiring
Person, Adverse 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, an Adverse Person or an Affiliate or Associate
of an Acquiring Person or an Adverse 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 occurrence of such
Section 24(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 (as hereinafter defined).
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 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 Company.
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 Certificates of like
tenor and date evidencing Rights entitling the holder to purchase
a like aggregate number of Depositary Receipts 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 holder of this Rights Certificate, as such, shall be entitled
to vote or receive dividends or be deemed for any purpose the
holder of Depositary Receipts or shares of Preferred Stock or of
any other securities of the Company which may at any time be
issuable 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 countersigned by the Rights
Agent.
WITNESS the facsimile signature of the proper officers of the
Company and its corporate seal.
Dated as of , 19
ATTEST:
Secretary
THE HARTFORD STEAM BOILER INSPECTION AND INSURANCE COMPANY
By
Title:
Countersigned:
THE FIRST NATIONAL BANK OF BOSTON, as Rights Agent
By
Authorized Signature
[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.
Dated: 19-
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, an Adverse Person or an Affiliate or
Associate of any such Person (as such terms are defined pursuant
to the Rights Agreement);
(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 subsequently became an Acquiring Person, an Adverse Person or
an Affiliate or Associate of any such Person.
Dated: 19-
Signature
Signature Guaranteed:
NOTICE
The signature to the foregoing Assignment 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.
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to exercise Rights represented
by the Rights Certificate)
To: HARTFORD STEAM BOILER INSPECTION AND INSURANCE COMPANY:
The undersigned hereby irrevocably elects to exercise
Rights represented by this Rights Certificate to purchase the
Depositary Receipts 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: 19-
Signature
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, an Adverse Person or an Affiliate or
Associate of any such Person (as such terms are defined pursuant
to the Rights Agreement);
(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, an Adverse Person or an Affiliate or
Associate of any such Person.
Dated: 19-
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.
Exhibit D
SUMMARY OF SHAREHOLDER RIGHTS PLAN
On November 28, 1988, the Board of Directors of The Hartford
Steam Boiler Inspection and Insurance Company (the "Company")
declared a dividend distribution of one Right for each
outstanding share of Company Common Stock to shareholders of
record at the close of business on December 8, 1988. Each Right
entitles the registered holder to purchase from the Company a
Depositary Receipt exercisable for one two-hundredth of a share
(a "Unit") of Series A Junior Participating Preferred Stock,
without par value (the "Preferred Stock"), at a Purchase Price
of $110.00 per Depositary Receipt subject to adjustment. The
description and terms of the Rights are set forth in a Rights
Agreement (the "Rights Agreement") between the Company and The
First National Bank of Boston, as Rights Agent.
Initially, the Rights will be attached to all Common Stock
certificates representing shares then outstanding, and no
separate Rights Certificates will be distributed. The Rights will
separate from the Common Stock and a Distribution Date will occur
upon the earliest of (i) 10 business days following a public
announcement that a person or group of affiliated or associated
persons (an "Acquiring Person") has acquired, or obtained the
right to acquire, beneficial ownership of 20% or more of the
outstanding shares of Common Stock (the "Stock Acquisition
Date"), (ii) 10 business days following the commencement of a
tender offer or exchange offer that would result in a person or
group beneficially owning 20% or more of such outstanding shares
of Common Stock or (iii) 10 business days after the Board of
Directors of the Company determines any person, alone or together
with its affiliates and associates has become the Beneficial
Owner of an amount of Common Stock which the Board of Directors
determines to be substantial (which amount shall in no event be
less than 10% of the shares of Common Stock outstanding) and
determines after reasonable inquiry and investigation, including
consultation with such persons as such directors shall deem
appropriate, that (a) such beneficial ownership by such person is
intended to cause the Company to repurchase the Common Stock
beneficially owned by such person or to cause pressure on the
Company to take action or enter into a transaction or series of
transactions intended to provide such person with short-term
financial gain under circumstances where the Board of Directors
determines that the best long-term interests of the Company and
its stockholders would not be served by taking such action or
entering into such transactions or series of transactions at that
time or (b) such beneficial ownership is causing or reasonably
likely to cause a material adverse impact (including, but not
limited to, by jeopardizing the Company's licenses or
authorizations from, or relationships with, state insurance
regulators, or by impairing relationships with customers or the
Company's ability to maintain its competitive position) on the
business or prospects of the Company to the detriment of the
Company's shareholders (any such person being referred to herein
and in the Rights Agreement as an "Adverse Person").
Until the Distribution Date, (i) the Rights will be evidenced by
the Common Stock certificates and will be transferred with and
only with such Common Stock certificates, (ii) new Common Stock
certificates issued after December 8, 1988 will contain a
notation incorporating the Rights Agreement by reference and
(iii) the surrender for transfer of any certificates for Common
Stock outstanding will also constitute the transfer of the Rights
associated with the Common Stock represented by such certificate.
The Rights are not exercisable until the Distribution Date and
will expire at the close of business on November 28, 1998, unless
earlier redeemed by the Company as described below.
As soon as practicable after the Distribution Date, Rights
Certificates will be mailed to holders of record of the Common
Stock as of the close of business on the Distribution Date and,
thereafter, the separate Rights Certificates alone will represent
the Rights. Except as otherwise determined by the Board of
Directors, only shares of Common Stock issued prior to the
Distribution Date will be issued with Rights.
In the event that the Board of Directors determines that a person
is an Adverse Person or, at any time following the Distribution
Date, a Person becomes the beneficial owner of more than 20% of
the then outstanding shares of Common Stock (except pursuant to
an offer for all outstanding shares of Common Stock which the
independent directors determine to be fair to and otherwise in
the best interests of the Company and its shareholders), each
holder of a Right will thereafter have the right to receive, upon
exercise, Common Stock (or, in certain circumstances, cash,
property or other securities of the Company) having a value equal
to two times the exercise price of the Right. Notwithstanding any
of the foregoing, following the occurrence of any of the events
set forth in this paragraph, all Rights that are, or (under
certain circumstances specified in the Rights Agreement) were,
beneficially owned by any Acquiring Person or Adverse Person will
be null and void. However, Rights are not exercisable following
the occurrence of either of the events set forth above until such
time as the Rights are no longer redeemable by the Company as set
forth below.
For example, at an exercise price of $110.00 per Right, each
Right not owned by an Acquiring Person or an Adverse Person by
certain related parties) following an event set forth in the
preceding paragraph would entitle its holder to purchase $220.00
worth of Common Stock (or other consideration, as noted above)
for $110.00. Assuming that the Common Stock had a per share value
of [current market] at such time, the holder of each valid Right
would be entitled to purchase shares of Common Stock for $110.00.
In the event that, at any time following the Stock Acquisition
Date,(i) the Company is acquired in a merger or other business
combination transaction in which the Company is not the surviving
corporation (other than a merger which follows an offer described
in the second preceding paragraph or a merger which follows an
offer described in the second preceding paragraph), (ii) the
Company engages in a merger or other business combination with
another person in which the Company is the surviving corporation,
but in which its Common Stock is changed or exchanged, or (iii)
50% or more of the Company's assets, cash flow or earning power
is sold or transferred, each holder of a Right (except Rights
which previously have been voided as set forth above) shall
thereafter have the right to receive, upon exercise, common stock
of the acquiring company having a value equal to two times the
exercise price of the Right. The events set forth in this
paragraph and in the second preceding paragraph are referred to
as the "Triggering Events".
The Purchase Price payable, and the number of Depositary Receipts
or other securities or property issuable, upon exercise of the
Rights are subject to adjustment from time to time to prevent
dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Preferred
Stock, (ii) if holders of the Preferred Stock are granted certain
rights or warrants to subscribe for Preferred Stock or
convertible securities at less than the current market price of
the Preferred Stock or (iii) upon the distribution to holders of
the Preferred Stock of evidences of indebtedness or assets
(excluding regular quarterly cash dividends) or of subscription
rights or warrants (other than those referred to above).
With certain exceptions no adjustment in the Purchase Price will
be required until cumulative adjustments amount to at least 1% of
the Purchase Price. No fractional Units will be issued and, in
lieu thereof, an adjustment in cash will be made based on the
market price of the Preferred Stock on the last trading date
prior to the date of exercise.
In general, the Company may redeem the Rights in whole, but not
in part, at a price of $.01 per Right (payable in cash, Common
Stock or other consideration deemed appropriate by the Board of
Directors), at any time until ten days following the Stock
Acquisition Date. The Company may not redeem the Rights if the
Board of Directors has previously declared a person to be an
Adverse Person. After the redemption period has expired, 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. Immediately upon the
action of the Board of Directors ordering redemption of the
Rights, the Rights will terminate and the only right of the
holders of Rights will be to receive the $.01 redemption price.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a shareholder of the Company, including,
without limitation, the right to vote or to receive dividends.
While the distribution of the Rights will not be taxable to
shareholders or to the Company, shareholders may, depending upon
the circumstances, recognize taxable income in the event that the
Rights become exercisable for Common Stock (or other
consideration) of the Company or for common stock of the
acquiring company as set forth above.
Other than those provisions relating to the principal economic
terms of the Rights, any of the provisions of the Rights
Agreement may be amended by the Board of Directors of the Company
prior to the Distribution Date. After the Distribution Date, the
provisions of the Rights Agreement may be amended by the Board in
order to cure any ambiguity, to make changes which do not
adversely affect the interests of holders of Rights (excluding
the interests of any Acquiring Person), or to shorten or lengthen
any time period under the Rights Agreement; provided, however,
that no amendment to adjust the time period governing redemption
shall be made at such time as the Rights are not redeemable.
A copy of the Rights Agreement is being filed with the Securities
and Exchange Commission as an Exhibit to a Current Report on Form
8-K. A copy of the Rights Agreement is available free of charge
from the Rights Agent. This summary description of the Rights
does not purport to be complete and is qualified in its entirety
by reference to the Rights Agreement, which is incorporated
herein by reference.