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EXHIBIT 4g
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ROWAN COMPANIES, INC.
and
CITIBANK, N.A.,
Rights Agent
_______________
Rights Agreement
As Amended
Dated as of February 25, 1992
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Table of Contents
Section Page
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1 Certain Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2 Appointment of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3 Issue of Rights Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4 Form of Rights Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
5 Countersignature and Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
6 Transfer, Split Up, Combination and Exchange of
Rights Certificates; Mutilated, Destroyed,
Lost or Stolen Rights Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
7 Exercise of Rights; Purchase Price; Expiration Date of Rights . . . . . . . . . . . . . . . . . . 13
8 Cancellation and Destruction of Rights Certificates . . . . . . . . . . . . . . . . . . . . . . . 16
9 Reservation and Availability of Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . 17
10 Junior Preferred Stock Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
11 Adjustment of Purchase Price, Number and Kind of
Shares or Number of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
12 Certificate of Adjusted Purchase Price or Number of Shares . . . . . . . . . . . . . . . . . . . 34
13 Consolidation, Merger or Sale or Transfer of Assets
or Earning Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
14 Fractional Rights and Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
15 Rights of Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
16 Agreement of Rights Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
17 Rights Certificate Holder Not Deemed a Shareholder . . . . . . . . . . . . . . . . . . . . . . . 43
18 Concerning the Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
19 Merger or Consolidation or Change of Name of Rights Agent . . . . . . . . . . . . . . . . . . . . 45
20 Duties of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
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21 Change of Rights Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
22 Issuance of New Rights Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
23 Redemption and Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
24 Notice of Certain Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
25 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
26 Supplements and Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
27 Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
28 Determinations and Actions by the Board of Directors, etc. . . . . . . . . . . . . . . . . . . . 56
29 Benefits of this Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
30 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
31 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
32 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
33 Descriptive Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Exhibit A -- Form of Rights Certificate
Exhibit B -- Form of Summary of Rights
Exhibit C -- Certificate of Designation
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RIGHTS AGREEMENT
RIGHTS AGREEMENT ("Agreement"), dated as of February 25, 1992 (the
"Agreement"), between Rowan Companies, Inc., a Delaware corporation (the
"Company"), and Citibank, N.A., a national banking association (the "Rights
Agent").
WHEREAS, on February 25, 1992 (the "Rights Dividend Declaration
Date"), the Board of Directors of the Company authorized and declared a
distribution of one Right for each share of common stock, par value $.125 per
share, of the Company (the "Company Common Stock") outstanding at the Close of
Business on March 11, 1992 (the "Record Date"), and has authorized the issuance
of one Right (as such number may hereinafter be adjusted pursuant hereto) for
each share of Company Common Stock issued between the Record Date (whether
originally issued or delivered from the Company's treasury) and, except as
otherwise provided in Section 22, the Distribution Date, each Right initially
representing the right to purchase upon the terms and subject to the conditions
hereinafter set forth one Unit of Series A Junior Preferred Stock (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 (other than the
Company, any Subsidiaries of the Company, any employee benefit plan maintained
by the Company or any of its Subsidiaries or any trustee or fiduciary with
respect to such plan acting in such capacity) which shall be the Beneficial
Owner of 15% or more of the shares of Company Common Stock then outstanding.
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(b) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as in
effect on the date hereof.
(c) A Person shall be deemed the "Beneficial Owner" of, and shall be
deemed to "beneficially own", any securities:
(i) of which such Person or any of such Person's Affiliates
or Associates is considered to be a "beneficial owner" under Rule
13d-3 of the General Rules and Regulations under the Exchange Act (the
"Exchange Act Regulations") as in effect on the date hereof, provided,
however, that a Person shall not be deemed the "Beneficial Owner" of,
or to "beneficially own", any securities under this subparagraph (i)
as a result of an agreement, arrangement or understanding to vote such
securities if such agreement, arrangement or understanding (A) arises
solely from a revocable proxy given in response to a proxy or consent
solicitation made pursuant to, and in accordance with, the applicable
provisions of the Exchange Act and the Exchange Act Regulations, and
(B) is not reportable by such Person on Schedule 13D under the
Exchange Act (or any comparable or successor report);
(ii) which are beneficially owned, directly or indirectly,
by any other Person (or any Affiliate or Associate of such other
Person) with which such Person (or any of such Person's Affiliates or
Associates) has any agreement, arrangement or understanding (whether
or not in writing) (other than customary agreements with and between
underwriters and selling group members with respect to a bona fide
public offering of securities), for the purpose of acquiring, holding,
voting (except pursuant to a revocable proxy as described in the
proviso to subparagraph (i) of this paragraph (c)) or disposing of
such securities; provided, however, that in no case shall an officer
or director of
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the Company be deemed (x) the Beneficial Owner of any securities
beneficially owned by another officer or director of the Company
solely by reason of actions undertaken by such persons in their
capacity as officers and directors of the Company or (y) the
Beneficial Owner of securities held of record by the trustee of any
employee benefit plan of the Company or any Subsidiary of the Company
for the benefit of any employee of the Company or any Subsidiary of
the Company, other than the officer or director, by reason of any
influence that such officer or director may have over the voting of
the securities held in the plan;
(iii) which such Person or any of such Person's Affiliates
or Associates, directly or indirectly, has the right or obligation to
acquire (whether such right or obligation is exercisable immediately
or only after the passage of time or upon the satisfaction of
conditions) pursuant to any agreement, arrangement or understanding
(whether or not in writing) (other than customary agreements with and
between underwriters and selling group members with respect to a bona
fide public offering of securities) or upon the exercise of conversion
rights, exchange rights, rights (other than these Rights), warrants or
options, or otherwise; or
(iv) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right or obligation to
vote pursuant to any agreement, arrangement or understanding (whether
or not in writing);
provided, however, that under this paragraph (c) 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 in accordance with Exchange Act
Regulations by such Person or any of such Person's Affiliates or Associates
until such tendered securities are accepted for purchase or exchange, (B)
securities that may be issued upon exercise of Rights at any time prior to the
occurrence of a Triggering Event, or (C) securities that may be issued upon
exercise of Rights from and after the occurrence of a
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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(c) or Section 22 hereof (the "Original Rights") or pursuant to
Section 11(i) hereof in connection with an adjustment made with respect to any
Original Rights.
(d) "Board Approval" shall mean the adoption by the Board of
Directors of the Company of a resolution or resolutions authorizing or
approving the action or determination (A) by the unanimous written consent of
all of the members of the Board of Directors of the Company or (B) by the
affirmative vote of not less than a majority of the members of the Board of
Directors of the Company (including not less than a majority of Continuing
Directors) at a meeting duly called and held at which a quorum was present and
acting throughout, provided, that at the time of adoption by the Board of
Directors of any such resolution or resolutions (x) there are not less than
three Continuing Directors and (y) a majority of the members of the Board of
Directors of the Company are Continuing Directors.
(e) "Board of Directors" shall mean the Board of Directors of the
Company.
(f) "Business Day" shall mean any day other than a Saturday,
Sunday or a day on which banking institutions in the states of New York or
Texas are authorized or obligated by law or executive order to close.
(g) "Close of Business" on any given date shall mean 5:00 P.M.,
New York, New York time, on such date; provided, however, that if such date is
not a Business Day it shall mean 5:00 P.M., New York, New York time, on the
next succeeding Business Day.
(h) "Common Stock" of any Person other than the Company shall mean
the capital stock of such Person with the greatest voting power, or, if such
Person shall have no capital stock, the equity securities or other equity
interest having power to control or direct the management of such Person.
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(i) "common stock equivalents" has the meaning set forth in Section
11(a)(iii).
(j) "Company Common Stock" has the meaning set forth in the
Whereas Clause.
(k) "Continuing Director" shall mean, as of the time a
determination is made, a member of the Board of Directors of the Company who is
not an Acquiring Person or an Affiliate or Associate of an Acquiring Person or
a director, officer or agent of an Acquiring Person or of any such Affiliate or
Associate, and who either (i) was a member of the Board of Directors of the
Company on February 25, 1992 or (ii) subsequently becomes a director of the
Company and whose election or nomination for election by the Company's
stockholders, received Board Approval.
(l) "current market price" has the meaning set forth in Section
11(d).
(m) "Current Value" has the meaning set forth in Section
11(a)(iii).
(n) "Distribution Date" has the meaning set forth in Section 3(a).
(o) "equivalent preferred stock" has the meaning set forth in
Section 11(b).
(p) "Expiration Date" has the meaning set forth in Section 7(a).
(q) "Final Expiration Date" has the meaning set forth in Section
7(a).
(r) "Junior Preferred Stock" shall mean the Series A Junior
Preferred Stock, $1.00 par value, of the Company having the voting powers,
designation, preferences and relative, participating, optional or other special
rights and qualifications, limitations and restrictions set forth in the form
of Certificate of Designation attached to this Agreement as Exhibit C.
(s) "Person" shall mean any individual, partnership, firm,
corporation, association, trust, unincorporated organization or other entity,
as well as any syndicate or group deemed to be a person under Section 14(d)(2)
of the Exchange Act.
(t) "Principal Party" has the meaning set forth in Section 13(b).
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(u) "Purchase Price" has the meaning set forth in Section 7(b).
(v) "Record Date" has the meaning set forth in the Whereas Clause.
(w) "Redemption Price" has the meaning set forth in Section 23.
(x) "Right" has the meaning set forth in the Whereas Clause.
(y) "Rights Certificate" has the meaning set forth in Section 3(a).
(z) "Rights Dividend Declaration Date" has the meaning set forth
in the Whereas Clause.
(aa) "Section 11(a)(ii) Event" shall mean any event described in
Section 11(a)(ii)(A), (B) or (C) hereof.
(bb) "Section 13 Event" shall mean any event described in clause
(x), (y) or (z) of Section 13(a) hereof.
(cc) "Stock Acquisition Date" shall mean the earlier of (i) the
first date of public announcement by the Company or an Acquiring Person that an
Acquiring Person has become such and (ii) the first date on which the Company
has actual knowledge of a filing with the Securities and Exchange Commission of
a report pursuant to Section 13(d) or 13(f) of the Exchange Act (which shall
include, without limitation, reports on Schedule 13D, Schedule 13G and Form
13F) by an Acquiring Person reflecting that an Acquiring Person has become
such.
(dd) "Subsidiary" shall mean, with reference to any Person, any
other Person of which an amount of voting securities or equity interests
sufficient to elect at least a majority of the directors or equivalent
governing body of such other Person is beneficially owned, directly or
indirectly, by such Person, or otherwise controlled by such first-mentioned
Person.
(ee) "Triggering Event" shall mean any Section 11(a)(ii) Event or
any Section 13 Event.
(ff) "Unit" has the meaning set forth in Section 7(b).
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, shall prior to the Distribution Date also
be holders of the Common Stock) in accordance with the terms and conditions
hereof,
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and the Rights Agent hereby accepts such appointment. With the consent of the
Rights Agent, the Company may from time to time appoint such Co-Rights Agents
("Co-Rights Agents") as it may deem necessary or desirable. In the event the
Company appoints one or more Co-Rights Agents, the respective duties of the
Rights Agent and any Co-Rights Agents shall be as the Company shall determine.
SECTION 3. ISSUE OF RIGHTS CERTIFICATES. (a) Until the earlier of (i)
the Close of Business on the tenth day after the Stock Acquisition Date, and
(ii) the Close of Business on the tenth day after the date of the commencement
of, or first public announcement of the intention of any Person (other than the
Company, any Subsidiary of the Company, any employee benefit plan maintained by
the Company or any of its Subsidiaries or any trustee or fiduciary with respect
to such plan acting in such capacity) to commence (which intention to commence
remains in effect for five business days after such announcement), a tender or
exchange offer, if upon consummation thereof such Person would be the
Beneficial Owner of 30% or more of the shares of Company Common Stock then
outstanding (the earlier of (i) and (ii) above being the "Distribution Date"),
(x) the Rights will be evidenced (subject to the provisions of paragraph (b) of
this Section 3) by the certificates for shares of Company Common Stock
registered in the names of the holders of shares of Company Common Stock as of
and subsequent to the Record Date (which certificates for shares of Company
Common Stock shall be deemed also to be certificates for Rights) and not be
separate certificates, and (y) the Rights will be transferable only in
connection with the transfer of the underlying shares of Company Common Stock
(including a transfer to the Company). As soon as practicable after the
Distribution Date, the Company will prepare and execute, the Rights Agent will
countersign and the Company will send or cause to be sent (and the Rights Agent
will, if requested by the Company, send) by first-class, insured, postage
prepaid mail, to each record holder of shares of Company Common Stock as of the
Close of Business on the Distribution
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Date, at the address of such holder shown on the records of the Company, one or
more rights certificates, in substantially the form of Exhibit A hereto (the
"Rights Certificates"), evidencing one Right for each share of Company Common
Stock so held, subject to adjustment as provided herein. In the event that an
adjustment in the number of Rights per share of Company Common Stock has been
made pursuant to Section 11(p) hereof, at the time of distribution of the
Rights Certificates, the Company may make the necessary and appropriate
rounding adjustments (in accordance with Section 14(a) hereof) so that Rights
Certificates representing only whole numbers of Rights are distributed and cash
is paid in lieu of any fractional Rights. As of and after the Distribution
Date, the Rights will be evidenced solely by such Rights Certificates.
(b) As promptly as practicable following the Record Date, the
Company will send a copy of a Summary of Rights to Purchase Junior Preferred
Stock, in a form which may be appended to certificates that represent shares of
Company Common Stock, in substantially the form attached hereto as Exhibit B
(the "Summary of Rights"), by first-class, postage prepaid mail, to each record
holder of shares of Company 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.
(c) Rights shall, without any further action, be issued in respect
of all shares of Company Common Stock which are issued (including any shares of
Company Common Stock held in treasury) after the Record Date but prior to the
earlier of the Distribution Date and the Expiration Date. Certificates,
representing such shares of Company Common Stock, issued after the Record Date
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
Rowan Companies, Inc. (the "Company") and Citibank, N.A. (the "Rights
Agent") dated as of February 25, 1992 (the "Rights Agreement"), the
terms of
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which are hereby incorporated herein by reference and a copy
of which is on file at the principal office of the Company. Under
certain circumstances, as set forth in the Rights Agreement, such
Rights may be redeemed, may expire, or may 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 any
Affiliate or Associate thereof (as such terms are defined in the
Rights Agreement), whether currently held by or on behalf of such
Person or by any subsequent holder, may become null and void."
With respect to certificates representing shares of Company Common Stock
(whether or not such certificates include the foregoing legend or have appended
to them the Summary of Rights), until the earlier of the Distribution Date and
the Expiration Date, the Rights associated with the shares of Company Common
Stock represented by such certificates shall be evidenced by such certificates
alone and registered holders of the shares of Company 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 shares of Company Common Stock represented by such certificates.
SECTION 4. FORM OF RIGHTS CERTIFICATE. (a) The Rights Certificates
(and the forms of election to purchase, assignment and certificate to be
printed on the reverse thereof) shall each be substantially in the form set
forth in Exhibit A hereto and may have such marks of identification or
designation and such legends, 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 any
rule or regulation thereunder or with any rule or regulation of any stock
exchange on which the Rights may from time to time be listed or to conform to
usage. Subject to the provisions of Section 11 and Section 22 hereof, the
Rights Certificates, whenever distributed, shall be dated as of
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the Record Date and on their face shall entitle the holders thereof to purchase
such number of Units of Junior Preferred Stock as shall be set forth therein at
the price set forth therein, but the amount and type of securities, cash or
other assets that may be acquired 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 hereto that represents
Rights beneficially owned by: (i) an Acquiring Person or any Associate or
Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) which becomes a transferee after the
Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person (or
of any such Associate or Affiliate) which becomes a transferee prior to or
concurrently with the Acquiring Person becoming such and which receives such
Rights pursuant to either (A) a transfer (whether or not for consideration)
from the Acquiring Person (or any such Associate or Affiliate) to holders of
equity interests in such Acquiring Person (or such Associate or Affiliate) or
to any Person with whom such Acquiring Person (or such Associate or Affiliate)
has any continuing agreement, arrangement or understanding regarding either the
transferred Rights, shares of Company Common Stock or the Company or (B) a
transfer which the Board of Directors by Board Approval has determined to be
part of a plan, arrangement or understanding which has as a primary purpose or
effect the avoidance of Section 7(e) hereof shall, upon the written direction
of the Board of Directors, 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 Affiliate or Associate of an Acquiring Person (as such terms are
defined in the Rights Agreement). Accordingly, this Rights
Certificate and the Rights represented hereby may become null and void
in the circumstances specified in Section 7(e) of such Agreement.
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The Company shall notify the Rights Agent and, if such notification is
given orally, the Company shall confirm same in writing on or prior to the
Business Day next following, at such time as the Company has notice that any
Person constitutes an Acquiring Person or an Affiliate or Associate of an
Acquiring Person, and until such notice is received by the Rights Agent, the
Rights Agent may conclusively presume for all purposes that the foregoing
legend need be imprinted only on Rights Certificates beneficially owned by
Persons that the Company has previously identified to the Rights Agent as
constituting an Acquiring Person or an Affiliate or Associate of an Acquiring
Person and transferees of any such Persons.
The provisions of Section 7(e) shall be operative whether or not the
foregoing legend is contained on any such Rights Certificate.
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 one of its Vice Presidents, under its corporate seal
reproduced thereon attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers on the Rights Certificate
may be manual or facsimile. Rights Certificates bearing the manual or
facsimile signatures of the individuals who were at any time the proper
officers of the Company shall bind the Company, notwithstanding that such
individuals or any of them have ceased to hold such offices prior to the
countersignature of such Rights Certificates or did not hold such offices at
the date of such Rights Certificates. No Rights Certificate shall be entitled
to any benefit under this Agreement or be valid for any purpose unless there
appears on such Rights Certificate a countersignature, for purposes of
authentication only, duly executed by the Rights Agent by manual signature of
an authorized signatory, and such countersignature upon any Rights Certificate
shall be conclusive evidence, and the only evidence, that such Rights
Certificates has been duly countersigned as
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required hereunder. It shall not be necessary for the same signatory of the
Rights Agent to countersign all of the Rights Certificates issued hereunder.
(b) Following the Distribution Date, the Rights Agent will keep or
cause to be kept, at its office designated for surrender of Rights Certificates
upon exercise or transfer, books for registration and transfer of the Rights
Certificates issued hereunder and shall keep such books until three years
following the first to occur of (i) the Expiration Date or (ii) the effective
date of redemption of the Rights pursuant to Section 23. Such books shall show
the name and address of each holder of the Rights Certificates, the number of
Rights evidenced on its face by each Rights Certificate, the Certificate number
and the date of each Rights Certificate.
SECTION 6. TRANSFER, SPLIT UP, COMBINATION AND EXCHANGE OF RIGHTS
CERTIFICATES; MUTILATED, DESTROYED, LOST OR STOLEN RIGHTS CERTIFICATES. (a)
Subject to the provisions of Sections 4(b), 7(e) and 14 hereof, at any time
after the Close of Business on the Distribution Date, and at or prior to the
Close of Business on the Expiration Date, any Rights Certificate or
Certificates may be transferred, split up, combined or exchanged for another
Rights Certificate or Certificates, entitling the registered holder to purchase
a like number of Units of Junior Preferred Stock (or, following a Triggering
Event, other securities, cash or other assets, as the case may be) as the
Rights Certificate or Certificates surrendered then entitled such holder 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
at the office 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 executed the certificate set
forth in the form of assignment on the reverse side of such
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Rights Certificate and shall have provided such additional evidence of the
identity of the Beneficial Owner (or former Beneficial Owner) of the Rights
represented by such Rights Certificate or Associates or Affiliates thereof as
the Company shall reasonably request; whereupon the Rights Agent shall, subject
to the provisions of Section 4(b), Section 7(e) and Section 14, 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 a
Rights Certificate or Rights Certificates.
(b) If a Rights Certificate shall be mutilated, lost, stolen or
destroyed, upon request by the registered holder of the Rights represented
thereby and upon payment to the Company and the Rights Agent of all reasonable
expenses incident thereto, there shall be issued, in exchange for and upon
cancellation of the mutilated Rights Certificate, or in substitution for the
lost, stolen or destroyed Rights Certificate, a new Rights Certificate, in
substantially the form of the prior Rights Certificate, of like tenor and
representing the equivalent number of Rights, but, in the case of loss, theft
or destruction, only upon receipt of evidence satisfactory to the Company and
the Rights Agent of such loss, theft or destruction of such Rights Certificates
and, if requested by the Company or the Rights Agent, indemnity also
satisfactory to it.
SECTION 7. EXERCISE OF RIGHTS; PURCHASE PRICE; EXPIRATION DATE OF
RIGHTS. (a) Prior to the earlier of (i) the Close of Business on February 25,
2002 (the "Final Expiration Date"), or (ii) the time at which the Rights are
redeemed as provided in Section 23 hereof (the earlier of (i) and (ii) being
the "Expiration Date"), the registered holder of any Rights Certificate may,
subject to the provisions of Sections 7(e) and 9(c), exercise the Rights
evidenced thereby in whole or in part at any time after the Distribution Date
upon surrender of the Rights Certificate, with
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the form of election to purchase and the certificate on the reverse side
thereof duly executed, to the Rights Agent at the office of the Rights Agent
designated for such purpose, together with payment of the aggregate Purchase
Price (as hereinafter defined for the number of Units of Junior Preferred Stock
(or, following a Triggering Event, other securities, cash or other assets, as
the case may be) for which such surrendered Rights are then exercisable.
(b) The purchase price for each one one-hundredth of a share (each
such one one-hundredth of a share being a "Unit") of Junior Preferred Stock
upon exercise of Rights shall be $30.00, subject to adjustment from time to
time as provided in Sections 11 and 13(a) hereof (such purchase price, as so
adjusted, being the "Purchase Price"), and shall be payable in lawful money of
the United States of America 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 for the Units of Junior Preferred Stock (or, following a
Triggering Event, other securities, cash or other assets, as the case may be)
to be purchased thereby as set forth below and an amount equal to any
applicable transfer tax or evidence satisfactory to the Company of payment of
such tax, the Rights Agent shall, subject to Section 20(k) hereof, thereupon
promptly (i) requisition from any transfer agent of the Junior Preferred Stock
or Company Common Stock, as the case may be (or make available, if the Rights
Agent is the transfer agent) certificates for the number of Units of Junior
Preferred Stock or Company Common Stock, as the case may be, to be purchased
and the Company hereby irrevocably authorizes its transfer agent to comply with
all such requests,(ii) requisition from the Company the amount of cash, if any,
to be paid in lieu of fractional shares in accordance with Section 14 hereof,
(iii) after receipt of such certificates, cause the same to be delivered to or
upon the order of the registered
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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. In the event that the Company is obligated to issue Company
Common Stock, other securities of the Company, pay cash and/or distribute other
property pursuant to Section 11(a) hereof, the Company will make all
arrangements necessary so that such Company Common Stock, other securities,
cash and/or other property are available for distribution by the Rights Agent,
if and when appropriate. The payment of the Purchase Price (as such amount may
be reduced pursuant to Section 11(a)(iii) hereof) may be made in cash or by
certified or bank check or money order payable to the order of the Company.
(d) In case the registered holder of any Rights Certificate shall
exercise less than all the Rights evidenced thereby, a new Rights Certificate
evidencing the Rights remaining unexercised shall be issued by the Rights Agent
and delivered to, or upon the order of, the registered holder of such Rights
Certificate, registered in such name or names as may be designated by such
holder, subject to the provisions of Section 14 hereof.
(e) Notwithstanding anything in this Agreement to the contrary,
from and after the first occurrence of a Section 11(a)(ii) Event, any Rights
beneficially owned by (i) an Acquiring Person or an Associate or Affiliate of
an Acquiring Person, (ii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) which becomes a transferee after the Acquiring Person
becomes such, or (iii) a transferee of an Acquiring Person (or of any such
Associate or Affiliate) which becomes a transferee prior to or concurrently
with the Acquiring Person becoming such and which receives such Rights pursuant
to either (A) a transfer (whether or not for consideration) from the Acquiring
Person (or any such Associate or Affiliate) to holders of equity interests in
such Acquiring Person (or any such Associate or
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Affiliate) or to any Person with whom the Acquiring Person (or such Associate
or Affiliate) has any continuing agreement, arrangement or understanding
(whether or not in writing) regarding the transferred Rights, shares of Company
Common Stock or the Company or (B) a transfer which the Board of Directors by
Board of Approval has determined to be part of a plan, arrangement or
understanding which has as a primary purpose or effect the avoidance of this
Section 7(e), shall be 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 ensure 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 or any other Person as a result of its failure to make any
determination under this Section 7(e) or such Section 4(b) with respect to an
Acquiring Person or its Affiliates, Associates or transferees.
(f) Notwithstanding anything in this Agreement or any Rights
Certificate 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 by such registered holder unless such
registered holder shall have (i) completed and executed the certificate
following 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) of the Rights represented by such Rights Certificate or
Associates or Affiliates thereof as the Company shall reasonably request.
SECTION 8. CANCELLATION AND DESTRUCTION OF RIGHTS CERTIFICATE. 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
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to the Rights Agent, shall be cancelled by it, and no Rights Certificates shall
be issued in lieu thereof except as expressly permitted by this Agreement. The
Company shall deliver to the Rights Agent for cancellation and retirement, and
the Rights Agent shall so cancel and retire, any Rights Certificates 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 deliver a certificate of destruction thereof to the
Company.
SECTION 9. RESERVATION AND AVAILABILITY OF CAPITAL STOCK. (a) The
Company shall at all times prior to the Expiration Date cause to be reserved
and kept available out of its authorized and unissued shares of Junior
Preferred Stock, the number of shares of Junior Preferred Stock that, as
provided in this Agreement, will be sufficient to permit the exercise in full
of all outstanding Rights. Upon the occurrence of any events resulting in an
increase in the aggregate number of shares of Junior Preferred Stock (or other
equity securities of the Company) issued upon exercise of all outstanding
Rights above the number then reserved, the Company shall make appropriate
increases in the number of shares so reserved,
(b) So long as the shares of Junior Preferred Stock to be issued
and delivered upon the exercise of the Rights may be listed on any national
securities exchange, the Company shall during the period from the Distribution
Date through the Expiration Date use its best efforts to cause all securities
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 (i) as soon as
practicable following the occurrence of a Section 11(a)(ii) Event and a
determination by the Company in accordance with Section 11(a)(iii) hereof of
the consideration to be delivered by the Company upon exercise of the Rights
or, if so required by law, as
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soon as practicable following the Distribution Date (such date being the
"Registration Date"), to file a registration statement on an appropriate form
under the Securities Act of 1933, as amended (the "Securities Act"), with
respect to the securities that may be acquired upon exercise of the Rights (the
"Registration Statement"), (ii) to cause the Registration Statement to become
effective as soon as practicable after such filing, (iii) to cause the
Registration Statement to continue to be effective (and to include a prospectus
complying with the requirements of the Securities Act) until the earlier of (A)
the date as of which the Rights are no longer exercisable for the securities
covered by the Registration Statement, and (B) the Expiration Date and (iv) to
take as soon as practicable following the Registration Date such action as may
be required to ensure that any acquisition of securities upon exercise of the
Rights complies with any applicable state securities or "blue sky" laws.
(d) The Company shall take such action as may be necessary to
ensure that all shares of Junior Preferred Stock (and, following the occurrence
of a Triggering Event, any other securities that may be delivered upon exercise
of Rights) shall be, at the time of delivery of the certificates or depositary
receipts for such securities, duly and validly authorized and issued and fully
paid and non-assessable.
(e) The Company shall pay any documentary, stamp or transfer tax
imposed in connection with the issuance or delivery of the Rights Certificates
or upon the exercise of Rights; provided, however, the Company shall not be
required to pay any such tax imposed in connection with the issuance or
delivery of Units of Junior Preferred Stock, or any certificates or depositary
receipts for such Units of Junior Preferred Stock (or, following the occurrence
of a Triggering Event, any other securities, cash or assets, as the case may
be) to any Person other than the registered holder of the Rights Certificates
evidencing the Rights surrendered for exercise. The Company shall not be
required to issue or deliver any certificates or depositary
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receipts for Units of Junior Preferred Stock (or, following the occurrence of a
Triggering Event, any other securities, cash or assets, as the case may be) to,
or in a name other than that of, the registered holder upon the exercise of any
Rights until any 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 10. JUNIOR PREFERRED STOCK RECORD DATE. Each Person in whose
name any certificate for Units of Junior Preferred Stock (or, following the
occurrence of a Triggering Event, other securities) is issued upon the exercise
of Rights shall for all purposes be deemed to have become the holder of record
of the Units of Junior Preferred Stock (or, following the occurrence of a
Triggering Event, other securities) 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 any applicable transfer taxes) was made; provided, however, that if the
date of such surrender and payment is a date upon which the Junior Preferred
Stock (or following the occurrence of a Triggering Event, other securities)
transfer books of the Company are closed, such Person shall be deemed to have
become the record holder of such securities on, and such certificate shall be
dated, the next succeeding Business Day on which the Junior Preferred Stock
(or, following the occurrence of a Triggering Event, other securities) transfer
books of the Company are open and, further provided, however, that if delivery
of Units of Junior Preferred Stock is delayed pursuant to Section 9(c) hereof,
such Persons shall be deemed to have become the record holders of such Units of
Junior Preferred Stock only when such Units first become deliverable. Prior to
the exercise of the Rights evidenced thereby, the holder of a Rights
Certificates shall not be entitled to any rights of a stockholder of the
Company with respect to securities for which the Rights shall be exercisable,
including, without limitation, the right to vote, to receive
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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 and to the extent provided herein.
SECTION 11. ADJUSTMENT OF PURCHASE PRICE, NUMBER AND KIND OF SHARES
OR NUMBER OF RIGHTS. The Purchase Price, the number and kind of securities
covered by each Right and the number of Rights outstanding are subject to
adjustment from time to time as provided in this Section 11.
(a) (i) In the event the Company shall at any time after the date
of this Agreement (A) declare a dividend on the Junior Preferred Stock payable
in shares of Junior Preferred Stock, (B) subdivide the outstanding Junior
Preferred Stock, (C) combine the outstanding Junior Preferred Stock into a
smaller number of shares, or (D) issue any shares of its capital stock in a
reclassification of the Junior Preferred Stock (including any such
reclassification in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation), except as otherwise
provided in this Section 11(a), the Purchase Price in effect at the time of the
record date for such dividend or of the effective date of such subdivision,
combination or reclassification, and the number and kind of shares of Junior
Preferred Stock or capital stock, as the case may be, issuable on such date
upon exercise of the Rights, shall be proportionately adjusted so that the
holder of any Right exercised after such time shall be entitled to receive,
upon payment of the Purchase Price then in effect, the aggregate number and
kind of shares of Junior Preferred Stock or capital stock, as the case may be,
which, if such Right had been exercised immediately prior to such date, 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 adjustment under both this Section 11(a)(i)
and Section 11(a)(ii) hereof, the
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adjustment provided for in this Section 11(a)(i) shall be in addition to, and
shall be made prior to, any adjustment required pursuant to Section 11 (a)(ii)
hereof.
(ii) In the event:
(A) Any Acquiring Person or any Associate or Affiliate of
any Acquiring Person, at any time after the date of this Agreement,
directly or indirectly, (1) shall merge into the Company or otherwise
combine with the Company and the Company shall be the continuing or
surviving corporation of such merger or combination and the Company
Common Stock shall remain outstanding and unchanged, (2) shall, in one
transaction or a series of transactions, transfer any assets to the
Company or to any of its Subsidiaries in exchange (in whole or in
part) for shares of Company Common Stock, for other equity securities
of the Company or any such Subsidiary, or for securities exercisable
for or convertible into shares of equity securities of the Company or
any of its Subsidiaries (whether Company Common Stock or otherwise) or
otherwise obtain from the Company or any of its Subsidiaries, with or
without consideration, any additional shares of such equity securities
or securities exercisable for or convertible into such equity
securities (other than pursuant to a pro rata distribution to all
holders of Company Common Stock), (3) shall sell, purchase, lease,
exchange, mortgage, pledge, transfer or otherwise acquire or dispose
of, in one transaction or a series of transactions, to, from or with
(as the case may be) the Company or any of its Subsidiaries or any
employee benefit plan maintained by the Company or any of its
Subsidiaries or any trustee or fiduciary with respect to such plan
acting in such capacity, assets (including securities) on terms and
conditions less favorable to the Company or such Subsidiary or plan
than those that could have been obtained in arm's-length negotiations
with an unaffiliated third party, other than pursuant to a transaction
set forth in Section 13(a) hereof, (4) shall sell, purchase, lease,
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exchange, mortgage, pledge, transfer or otherwise acquire or dispose
of, in one transaction or a series of transactions, to, from or with
the Company or any of the Company's Subsidiaries or any employee
benefit plan maintained by the Company or any of its Subsidiaries or
any trustee or fiduciary with respect to such plan acting in such
capacity, assets (including securities) having an aggregate fair
market value of more than $5,000,000, other than pursuant to a
transaction set forth in Section 13(a) hereof, (5) shall receive, or
any designee, agent or representative of such Acquiring Person or any
Associate or Affiliate of such Acquiring Person shall receive, any
compensation from the Company or any of its Subsidiaries other than
compensation for full-time employment as a regular employee at rates
in accordance with the Company's (or its Subsidiaries') past
practices, or (6) shall receive the benefit, directly or indirectly
(except proportionately as a holder of Company Common Stock or as
required by law or governmental regulation), of any loans, advances,
guarantees, pledges or other financial assistance or any tax credits
or other tax advantage provided by the Company or any of its
Subsidiaries or any employee benefit plan maintained by the Company or
any of its Subsidiaries or any trustee or fiduciary with respect to
such plan acting in such capacity; or
(B) any Person (other than the Company, any Subsidiary of
the Company, any employee benefit plan maintained by the Company or
any of its Subsidiaries or any trustee or fiduciary with respect to
such plan acting in such capacity) shall become the Beneficial Owner
of 15% or more of the shares of Company Common Stock then outstanding,
other than pursuant to any transaction set forth in Section 13(a)
hereof, or
(C) during such time as there is an Acquiring Person, there
shall be any reclassification of securities (including any reverse
stock split) or recapitalization of the Company, or any merger or
consolidation of the Company
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with any of its Subsidiaries or any other transaction or series of
transactions involving the Company or any of its Subsidiaries, other
than a transaction or transactions to which the provisions of Section
13(a) apply (whether or not with or into or otherwise involving an
Acquiring Person), which has the effect, directly or indirectly, of
increasing by more than 1% the proportionate share of the outstanding
shares of any class of equity securities of the Company or any of its
Subsidiaries which is directly or indirectly beneficially owned by any
Acquiring Person or any Associate or Affiliate of any Acquiring
Person;
then, immediately upon the date of the occurrence of an event described in
Section 11(a)(ii)(A)-(C) hereof (a "Section 11(a)(ii) Event"), proper provision
shall be made so that each holder of a Right (except as provided below and in
Section 7(e) hereof) shall thereafter have the right to receive, upon exercise
thereof at the then current Purchase Price in accordance with the terms of this
Agreement, in lieu of the number of Units of Junior Preferred Stock for which a
Right was exercisable immediately prior to the first occurrence of a Section
11(a)(ii) Event, such number of shares of Company Common Stock as shall equal
the result obtained by (x) multiplying the then current Purchase Price by the
then number of Units of Junior Preferred Stock for which a Right was
exercisable immediately prior to the first occurrence of a Section 11(a)(ii)
Event (such product thereafter being, for all purposes of this Agreement other
than Section 13 hereof, the "Purchase Price"), and (y) dividing that product by
50% of the then current market price (determined pursuant to Section 11(d)
hereof) per share of Company Common Stock on the date of such first occurrence
(such number of shares of Company Common Stock being the "Adjustment Shares").
(iii) In the event that, upon the occurrence of a Section 11(a)(ii)
Event, the number of shares of Company Common Stock which are treasury shares
or are authorized by the Company's Certificate of Incorporation and are not
issued or
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reserved for issuance for purposes other than upon exercise of the Rights is
not sufficient to permit the exercise in full of the Rights in accordance with
the foregoing subparagraph (ii) of this Section 11(a), the Company, by Board
Approval, 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 being the "Spread"), and (B) with respect to each
Right, make adequate provision to substitute for such Adjustment Shares, upon
payment of the applicable Purchase Price, (1) cash, (2) a reduction in the
Purchase Price, (3) a number of shares, or units of shares, or other equity
securities of the Company (including, without limitation, shares, or units of
shares, of preferred stock (such other shares being "common stock
equivalents")), (4) debt securities of the Company, (5) other assets or (6) any
combination of the foregoing, having an aggregate value equal to the Current
Value, where such aggregate value has been determined by the Board of Directors
by Board Approval, after receiving advice from a nationally recognized
investment banking firm; provided, however, that if the Company shall not have
made adequate provision to deliver value pursuant to clause (B) above within 90
days following the later of (x) the first occurrence of a Section 11(a)(ii)
Event and (y) the date on which the Company's right of redemption pursuant to
Section 23(a) expires (the later of (x) and (y) being referred to herein as the
"Section 11(a)(iii) 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 Company Common Stock (to the extent
available) and then, if necessary, cash, which shares of Company Common Stock
and/or cash shall have an aggregate value equal to the Spread. To the extent
that the Company determines that some action need be taken pursuant to the
first sentence of this Section 11(a)(iii), the Company shall provide, subject
to Section 7(e) hereof, that such action shall apply uniformly to all
outstanding Rights. For purposes of this Section 11(a)(iii), the value of a
share of Company Common Stock
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shall be the current market price (as determined pursuant to Section 11(d)
hereof) per share of Company Common Stock on the Section 11(a)(iii) Trigger
Date and the value of any common stock equivalent shall be deemed to have the
same value as the Company 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 Junior Preferred Stock
entitling them to subscribe for or purchase (for a period expiring within 45
calendar days after such record date) shares of Junior Preferred Stock (or
shares having substantially the same rights, privileges and preferences as
shares of Junior Preferred Stock ("equivalent preferred stock")) or securities
convertible into Junior Preferred Stock or equivalent preferred stock at a
price per share of Junior Preferred Stock or per share of equivalent preferred
stock (or having a conversion price per share, if a security convertible into
Junior Preferred Stock or equivalent preferred stock) less than the current
market price (as determined pursuant to Section 11(d) hereof) per share of
Junior 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 sum of the number of shares of Junior Preferred Stock
outstanding on such record date plus the number of shares of Junior Preferred
Stock which the aggregate offering price of the total number of shares of
Junior 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 Junior Preferred Stock outstanding on
such record date plus the number of additional shares of Junior 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
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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 by Board Approval, 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 Junior Preferred Stock owned by or
held for the account of the Company or any Subsidiary 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 shares of Junior Preferred Stock (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing corporation) of evidences of indebtedness, cash
(other than a regular quarterly cash dividend out of the earnings or retained
earnings of the Company), assets (other than a dividend payable in shares of
Junior Preferred Stock, but including any dividend payable in stock other than
Junior Preferred Stock) or subscription rights or warrants (excluding those
referred to in Section 11(b) hereof), the Purchase Price to be in effect after
such record date shall be determined by multiplying the Purchase Price in
effect immediately prior to such record date by a fraction, the numerator of
which shall be the current market price (as determined pursuant to Section
11(d) hereof) per share of Junior Preferred Stock on such record date less the
fair market value (as determined in good faith by the Board of Directors by
Board Approval, whose determination shall be described in a statement filed
with the Rights Agent and shall be binding on the Rights Agent and the holder
of the Rights) of the cash, assets or evidences of indebtedness so to be
distributed or of such subscription rights or warrants distributable in respect
of a share of Junior Preferred Stock and the
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denominator of which shall be such current market price (as determined pursuant
to Section 11(d) hereof) per share of Junior 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, the "current
market price" per share of Company Common Stock or Common Stock on any date
shall be deemed to be the average of the daily closing prices per share of such
shares for the ten consecutive Trading Days (as such term is hereinafter
defined) immediately prior to such date; provided, however, if prior to the
expiration of such requisite ten Trading Day period the issuer announces either
(A) a dividend or distribution on such shares payable in such shares or
securities convertible into such shares (other than the Rights), or (B) any
subdivision, combination or reclassification of such shares, then, following
the ex-dividend date for such dividend or the record date for such subdivision,
as the case may be, the "current market price" shall be properly adjusted to
take into account such event. The closing price for each date shall be, if the
shares are listed and admitted to trading on a national securities exchange, as
reported in the principal consolidated transaction reporting system with
respect to securities listed on the principal national securities exchange on
which such shares are listed or admitted to trading or, if such shares 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 such shares 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 such shares
selected by the Board of Directors by Board Approval. If on
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any such date no market maker is making a market in such shares, the fair value
of such shares on such date as determined in good faith by the Board of
Directors by Board Approval shall be used. If such shares are 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
by Board Approval, whose determination shall be described in a statement filed
with the Rights Agent and shall be conclusive for all purposes. The term
"Trading Day" shall mean, if such shares are listed or admitted to trading on
any national securities exchange, a day on which the principal national
securities exchange on which such shares are listed or admitted to trading is
open for the transaction of business or, if such shares are not so listed or
admitted, a Business Day.
(ii) For the purpose of any computation hereunder, the "current
market price" per share of Junior Preferred Stock shall be determined in the
same manner as set forth above for Company Common Stock in clause (i) of this
Section 11(d) (other than the fourth sentence thereof). If the current market
price per share of Junior Preferred Stock cannot be determined in the manner
provided above or if the Junior Preferred Stock is not publicly held or listed
or traded in a manner described in clause (i) of Section 11(d), the "current
market price" per share of Junior Preferred Stock shall be conclusively deemed
to be an amount equal to 100 (as such amount may be appropriately adjusted for
such events as stock splits, stock dividends and recapitalizations with respect
to Company Common Stock occurring after the date of this Agreement) multiplied
by the current market price per share of Company Common Stock. If neither
Company Common Stock nor Junior Preferred Stock is publicly held or so listed
or traded, "current market price" per share of the Junior Preferred Stock shall
mean the fair value per share as determined in good faith by the Board of
Directors by Board Approval whose determination shall be described in a
statement filed with the Rights Agent and shall be binding on the Rights Agent
and
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the holders of the Rights. For all purposes of this Agreement, the "current
market price" of a Unit of Junior Preferred Stock shall be equal to the
"current market price" of one share of Junior Preferred Stock divided by 100.
(e) Anything herein to the contrary notwithstanding, no adjustment
in the Purchase Price shall be required unless such adjustment would require an
increase or decrease of at least 1% in the Purchase Price; provided, however,
that any adjustments which by reason of this Section 11(e) are not required to
be made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made to the
nearest cent or to the nearest ten-thousandth of a share of Company Common
Stock or Common Stock or other share or one-millionth of a share of Junior
Preferred Stock, as the case may be. Notwithstanding the first sentence of
this Section 11(e), any adjustment required by this Section 11 shall be made no
later than the earlier of (i) three years from the date of the transaction
which mandates such adjustment or (ii) the Expiration Date.
(f) If as a result of any provision of Sections 11(a)(ii) or 13(a)
hereof, the holder of any Right thereafter exercised shall become entitled to
receive any shares of capital stock other than Junior 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 Junior Preferred Stock contained in Sections
11(a), (b), (c), (d), (e), (g), (h), (i), (j), (k), (l) and (m), and the
provisions of Sections 7, 9, 10, 13 and 14 hereof with respect to the Junior
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 Units of Junior
Preferred Stock (or other securities or amount of cash or combination thereof)
that may be
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acquired from time to time hereunder upon exercise of the Rights, all subject
to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as
provided in Section 11(i), upon each adjustment of the Purchase Price as a
result of the calculations made in Sections 11(b) and (c), each Right
outstanding immediately prior to the making of such adjustment shall thereafter
evidence the right to purchase, at the adjusted Purchase Price, that number of
Units of Junior Preferred Stock (calculated to the nearest one-ten thousandth
of a Unit) obtained by (i) multiplying (x) the number of Units of Junior
Preferred Stock covered by a Right immediately prior to this adjustment by (y)
the Purchase Price in effect immediately prior to such adjustment of the
Purchase Price and (ii) dividing the product so obtained by the Purchase Price
in effect immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any adjustment
of the Purchase Price to adjust the number of Rights, in lieu of any adjustment
in the number of Units of Junior Preferred Stock that may be acquired 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 Units of Junior
Preferred Stock for which a Right was exercisable immediately prior to such
adjustment. Each Right held of record prior to such adjustment of the number
of Rights shall become that number of Rights (calculated to the nearest
ten-thousandth) obtained by dividing the Purchase Price in effect immediately
prior to adjustment of the Purchase Price by the Purchase Price in effective
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
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been issued, shall be at least ten days later than the date of such public
announcement. If Rights Certificates have been issued, upon each adjustment of
the number of Rights pursuant to this Section 11(i), the Company shall, as
promptly as practicable, cause to be distributed to holders of record of Rights
Certificates on such record date Rights Certificates evidencing, subject to
Section 14 hereof, the additional Rights to which such holders shall be
entitled as a result of such adjustment, or, at the option of the Company,
shall cause to be distributed to such holders of record in substitution and
replacement for the 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 to be so 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 Units of Junior Preferred Stock issuable upon the exercise of
the Rights, the Rights Certificates theretofore and thereafter issued may
continue to express the Purchase Price per Unit and the number of Units of
Junior Preferred Stock which was 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 par value of the number of Units of
Junior Preferred Stock issuable upon exercise of the Rights, or below the then
par value of the shares of Company Common Stock if then issuable upon exercise
of the Rights, 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 such fully paid and non-assessable number of Units of Junior
Preferred Stock or, if applicable, shares
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of Company Common Stock at such adjusted Purchase Price. If upon any exercise
of the Rights, a holder is to receive a combination of Units of Junior
Preferred Stock and preferred stock equivalents or Company Common Stock and
common stock equivalents, a portion of the consideration paid upon such
exercise, equal to at least the then par value of a share of Junior Preferred
Stock or Company Common Stock, as the case may be, shall be allocated as
payment for each share of Junior Preferred Stock or Company Common Stock so
received.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuance to the holder of any Right exercised after such record date
of that number of Units of Junior Preferred Stock and shares of other capital
stock or securities of the Company, if any, issuable upon such exercise over
and above the number of Units of Junior Preferred Stock and shares of 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 11 to the contrary notwithstanding,
the Company shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that in their good faith judgment the Board of Directors by Board
Approval shall determine to be advisable in order that any (i) consolidation or
subdivision of the Junior Preferred Stock, (ii) issuance wholly for cash of any
shares of Junior Preferred Stock at less than the current market price, (iii)
issuance wholly for cash of shares of Junior Preferred Stock or securities
which by their terms are convertible into or
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exchangeable for shares of Junior Preferred Stock, (iv) stock dividends or (v)
issuance of rights, options or warrants referred to in this Section 11,
hereafter made by the Company to holders of its Junior Preferred Stock, shall
not be taxable to such holders or shall reduce the taxes payable by such
holders.
(n) The Company shall not, at any time after the Distribution
Date, (i) consolidate with any other Person (other than a Subsidiary of the
Company in a transaction which complies with Section 11(o) hereof), (ii) merge
with or into any other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) hereof), or (iii) sell or
transfer (or permit any Subsidiary to sell or transfer), in one transaction, or
a series of transactions, assets or earning power aggregating more than 50% of
the assets or earning power of the Company and its Subsidiaries (taken as a
whole) to any other Person or Persons (other than the Company and/or any of its
Subsidiaries in one or more transactions each of which complies with Section
11(o) hereof), if (x) at the time of or immediately after such consolidation,
merger or sale there are any rights, warrants or other instruments or
securities outstanding or agreements in effect which would substantially
diminish or otherwise eliminate the benefits intended to be afforded by the
Rights or (y) prior to, simultaneously with or immediately after such
consolidation, merger or sale, the Person which constitutes, or would
constitute, the "Principal Party" for purposes of Section 13(a) hereof shall
have distributed or otherwise transferred (or will distribute or otherwise
transfer) to its stockholders, or other persons holding an equity interest in
such Person, Rights previously owned by such Person or any of its Affiliates
and Associates; provided, however, this Section 11(n) shall not affect the
ability of any Subsidiary of the Company to consolidate with, merge with or
into, or sell or transfer assets or earning power to, any other Subsidiary of
the Company.
(o) After the Distribution Date, the Company shall not, except as
permitted by Section 23 or Section 26 hereof, take (or permit any Subsidiary to
take)
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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 Company Common Stock payable in shares of Company
Common Stock, (ii) subdivide the outstanding shares of Company Common Stock,
(iii) combine the outstanding shares of Company Common Stock into a smaller
number of shares, or (iv) issue any shares of its capital stock in a
reclassification of Company Common Stock (including any such reclassification
in connection with a consolidation or merger in which the Company is the
continuing or surviving corporation), the number of Rights associated with each
share of Company 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
Company Common Stock following any such event shall equal the result obtained
by multiplying the number of Rights associated with each share of Company
Common Stock immediately prior to such event by a fraction the numerator of
which shall be the total number of shares of Company Common Stock outstanding
immediately prior to the occurrence of the event and the denominator of which
shall be the total number of shares of Company Common Stock outstanding
immediately following the occurrence of such event.
SECTION 12. CERTIFICATE OF ADJUSTED PURCHASE PRICE OR NUMBER OF
SHARES. Whenever an adjustment is made as provided in Section 11 or Section 13
hereof, the Company shall (a) promptly prepare a certificate setting forth such
adjustment and a brief statement of the facts accounting for such adjustment,
(b) promptly file with the Rights Agent, and with each transfer agent for the
Junior
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Preferred Stock and the Company 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 Company Common Stock) in accordance with Section 25 hereof; provided,
however, that the failure of the Company to make such a certificate or give
such notice shall not affect the validity or the force or effect of the
requirement for such an adjustment. The Rights Agent shall be fully protected
in relying on any such certificate and on any adjustment therein contained and
shall not be deemed to have knowledge of any such adjustment unless and until
it shall have received such certificate.
SECTION 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR
EARNING POWER. (a) In the event that, following the Stock Acquisition Date,
directly or indirectly, either (x) the Company shall consolidate with, or merge
with and into, any other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) hereof), and the Company shall
not be the continuing or surviving corporation of such consolidation or merger,
(y) any Person (other than a Subsidiary of the Company in a transaction which
complies with Section 11(o) hereof) shall consolidate with, or merge with or
into, the Company, and the Company shall be the continuing or surviving
corporation of such consolidation or merger and, in connection with such
consolidation or merger, all or part of the outstanding shares of Company
Common Stock shall be converted 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) to any Person or Persons (other than the Company or any of
its Subsidiaries in one or more transactions each of which complies with
Section 11(o) hereof), in one or more transactions, assets or earning power
aggregating more than 50% of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) (any such event being a "Section 13 Event"),
then, and in each such case, proper provision
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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, such number of validly
authorized and issued, fully paid, and non-assessable shares of Common Stock of
the Principal Party (as such term is hereinafter defined), which shares shall
not be subject to any liens, encumbrances, rights of call or first refusal,
transfer restrictions or other adverse claims, as shall be equal to the result
obtained by (1) multiplying the then current Purchase Price by the number of
Units of Junior Preferred Stock for which a Right is exercisable immediately
prior to the first occurrence of a Section 13 Event (or, if a Section 11
(a)(ii) Event has occurred prior to the first occurrence of a Section 13 Event,
multiplying the number of such Units for which a Right would be exercisable
hereunder but for the occurrence of such Section 11(a)(ii) Event by the
Purchase Price which would be in effect hereunder but for such first
occurrence) and (2) dividing that product (which, following the first
occurrence of a Section 13 Event, shall be the "Purchase Price" for all
purposes of this Agreement) by 50% of the current market price (determined
pursuant to Section 11(d) hereof) per share of the Common Stock of such
Principal Party on the date of consummation of such Section 13 Event; (ii) such
Principal Party shall thereafter be liable for, and shall assume, by virtue of
such Section 13 Event, all the obligations and duties of the Company pursuant
to this Agreement; (iii) the term "Company" shall thereafter be deemed to refer
to such Principal Party, it being specifically intended that the provisions of
Section 11 hereof shall apply only to such Principal Party following the first
occurrence of a Section 13 Event; (iv) such Principal Party shall take such
steps (including, but not limited to, the reservation of a sufficient number of
shares of its Common Stock) in connection with the consummation of any such
transaction as may be necessary to ensure that the provisions of this Agreement
shall thereafter be applicable to its shares of Common Stock thereafter
deliverable upon the exercise of the Rights; and (v) the
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provisions of Section 11(a)(ii) hereof shall be of no further effect following
the first occurrence of any Section 13 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 13(a), (A) the Person that is
the issuer of any securities into which shares of Company Common Stock
are converted in such merger or consolidation, or, if there is more
than one such issuer, the issuer of Common Stock that has the highest
aggregate current market price (determined pursuant to Section 11(d)
hereof) and (B) if no securities are so issued, the Person that is the
other party to such merger or consolidation, or, if there is more than
one such Person, the Person the Common Stock of which has the highest
aggregate current market price (determined pursuant to Section 11(d)
hereof); and
(ii) in the case of any transaction described in clause (z)
of the first sentence of Section 13(a), the Person that is the party
receiving the largest portion of the assets or earning power
transferred pursuant to such transaction or transactions, or, if each
Person that is a party to such transaction or transactions received
the same portion of the assets or earning power transferred pursuant
to such transaction or transactions or if the Person receiving the
largest portion of the assets or earning power cannot be determined,
whichever Person the Common Stock of which has the highest aggregate
current market price (determined pursuant to Section 11(d) hereof);
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-month period registered under Section 12 of the Exchange Act
("Registered Common Stock"), or such Person is not a corporation, and such
Person is a direct or indirect Subsidiary of another Person that has Registered
Common Stock outstanding,
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"Principal Party" shall refer to such other Person; (2) if the Common Stock of
such Person is not Registered Common Stock or such Person is not a corporation,
and such Person is a direct or indirect Subsidiary or another Person but is not
a direct or indirect Subsidiary of another Person which has Registered Common
Stock outstanding, "Principal Party" shall refer to the ultimate parent entity
of such firstmentioned Person; (3) if the Common Stock of such Person is not
Registered Common Stock or such Person is not a corporation, and such Person is
directly or indirectly controlled by more than one Person, and one or more of
such other Persons has Registered Common Stock outstanding, "Principal Party"
shall refer to whichever of such other Persons is the issuer of the Registered
Common Stock having the highest aggregate current market price (determined
pursuant to Section 11(d) hereof); and (4) if the Common Stock of such Person
is not Registered Common Stock or such Person is not a corporation, and such
Person is directly or indirectly controlled by more than one Person, and none
of such other Persons have Registered Common Stock outstanding, "Principal
Party" shall refer to whichever ultimate parent entity is the corporation
having the greatest shareholders equity or, if no such ultimate parent entity
is a corporation, shall refer to whichever ultimate parent entity is the entity
having the greatest net assets.
(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 13, 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 13 and further providing that the Principal Party will:
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(i) (A) prepare and file on an appropriate form, as soon as
practicable following the execution of such agreement and at its own
expense, a registration statement under the Securities Act with
respect to the Common Stock that may be acquired upon exercise of the
Rights, (B) use its best efforts to cause such registration statement
to become and remain effective (and to include a prospectus complying
with the requirements of the Securities Act) until the Expiration
Date, and (C) as soon as practicable following the execution of such
agreement, take such action as may be required to ensure that any
acquisition of such Common Stock upon the exercise of the Rights
complies with any applicable state security or "blue sky" laws; and
(ii) 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.
(d) In case the Principal Party which is to be a party to a
transaction referred to in this Section 13 has a provision in any of its
authorized securities or in its Certificate of Incorporation or By-laws or
other instrument governing its corporate affairs, which provision would have
the effect of (i) causing such Principal Party to issue, in connection with, or
as a consequence of, the consummation of a transaction referred to in this
Section 13, shares of Common Stock of such Principal Party at less than the
then current market price per share (determined pursuant to Section 11(d)
hereof) or securities exercisable for, or convertible into, Common Stock of
such Principal Party at less than such than current market price (other than,
in each case, to holders of Rights pursuant to this Section 13) or (ii)
providing for any special payment, tax or similar provisions in connection with
the issuance of the Common Stock of such Principal Party pursuant to the
provisions of this Section 13; then, in such event, the Company shall not
consummate any such transaction unless prior thereto the Company and such
Principal Party shall have executed and
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delivered to the Rights Agent a supplemental agreement providing that the
provision in question of such Principal Party shall have been cancelled, waived
or amended, or that the authorized securities shall be redeemed, so that the
applicable provision will have no effect in connection with, or as a
consequence of, the consummation of the proposed transaction.
(e) The provisions of this Section 13 shall similarly apply to
successive mergers or consolidations or sales or other transfers. In the event
that a Section 13 Event shall occur at any time after the occurrence of a
Section 11(a)(ii) Event, the Rights which have not theretofore been exercised
shall thereafter become exercisable in the manner described in Section 13(a).
SECTION 14. FRACTIONAL RIGHTS AND FRACTIONAL SHARES. (a) The Company
shall not be required to issue fractions of Rights or to distribute Rights
Certificates which evidence fractional Rights. In lieu of such fractional
Rights, there shall be paid to the Persons to which such fractional Rights
would otherwise be issuable, an amount in cash equal to such fraction of the
market value of a whole Right. For purposes of this Section 14(a), the 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,
if the Rights are listed or admitted to trading on a national securities
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
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a market in the Rights selected by the Board of Directors by Board Approval.
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 by Board Approval shall be used and such determination shall be
described in a statement filed with the Rights Agent and the holders of the
Rights.
(b) The Company shall not be required to issue fractions of shares
of Junior Preferred Stock (other than fractions which are integral multiples of
one one-hundredth of a share of Junior Preferred Stock) upon exercise of the
Rights or to distribute certificates which evidence such fractional shares of
Junior Preferred Stock (other than fractions which are integral multiples of
one one-hundredth of a share of Junior Preferred Stock). Fractions of shares
of Junior Preferred Stock in integral multiples of one one-hundredth of a share
of Junior Preferred Stock may, at the election of the Company, be evidenced by
depositary receipts, pursuant to an appropriate agreement between the Company
and a depositary selected by it provided that such agreement shall provide that
the holders of such depositary receipts shall have all the rights, privileges
and preferences to which they are entitled as beneficial owners of the
fractions of shares of Junior Preferred Stock represented by such depositary
receipts. In lieu of such fractional shares of Junior Preferred Stock that are
not integral multiples of one one-hundredth of a share, the Company may pay to
the registered holders of Rights Certificates at the time such Rights are
exercised as herein provided an amount in cash equal to the same fraction of
the then current market price of a share of Junior Preferred Stock on the day
of exercise, determined in accordance with Section 11(d) hereof.
(c) The holder of a Right by the acceptance of the Rights
expressly waives his right to receive any fractional Rights or any fractional
shares upon exercise of a Right, except as permitted by this Section 14.
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SECTION 15. RIGHTS OF ACTION. All rights of action in respect of this
Agreement, other than rights of action vested in the Rights Agent pursuant to
Section 18, are vested in the respective registered holders of the Rights
Certificates (and, prior to the Distribution Date, the registered holders of
certificates representing shares of Company Common Stock); and any registered
holder of a Rights Certificate (or, prior to the Distribution Date, of a
certificate representing shares of Company 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 a certificate representing shares of Company
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 or
any other Person 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. Holders of Rights shall be entitled to recover the
reasonable costs and expenses, including attorneys' fees, incurred by them in
any contested action to enforce the provisions of this Agreement where that
action is terminated and the relief requested by the holders is granted.
SECTION 16. AGREEMENT OF RIGHTS HOLDERS. Every holder of a Right by
accepting the same consents and agrees with the Company and the Rights Agent
and with every other holder of a Right that:
(a) prior to the Distribution Date, the Rights will be
transferable only in connection with the transfer of Company Common
Stock;
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(b) after the Distribution Date, the Rights Certificates are
transferable only on the registry books of the Rights Agent if
surrendered at the office 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 duly
executed;
(c) subject to Section 6(a) and Section 7(f), 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
Company 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 Company 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), shall 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 any 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 promptly as practicable.
SECTION 17. RIGHTS CERTIFICATE HOLDER NOT DEEMED A STOCKHOLDER. No
holder, as such, of any Rights Certificate shall be entitled to vote, receive
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dividends or be deemed for any purpose the holder of the number of shares of
Junior Preferred Stock or any other securities of the Company which may at any
time be issuable on the exercise of the Rights represented thereby, nor shall
anything contained herein or in any Rights Certificate be construed to confer
upon the holder of any Rights Certificate, as such, any of the rights of a
stockholder of the Company or any right to vote for the election of directors
or upon any matter submitted to stockholders at any meeting thereof, or to give
or withhold consent to any corporate action, or, except as provided in Section
24 hereof, to receive notice of meetings or other actions affecting
stockholders, 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 thereof.
SECTION 18. CONCERNING THE RIGHTS AGENT. (a) The Company agrees to
pay to the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses, including reasonable fees and disbursements of its counsel, incurred
in connection with the execution and administration of this Agreement and the
exercise and performance of its duties hereunder. The Company shall indemnify
the Rights Agent for, and hold it harmless against, any loss, liability, or
expense, incurred without negligence, bad faith or willful misconduct on the
part of the Rights Agent, for anything done or omitted by the Rights Agent in
connection with the acceptance and administration of this Agreement, including
the costs and expenses of defending against any claim of liability arising
therefrom, directly or indirectly, or prosecuting any action to determine the
rights or obligations of the parties hereunder.
(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 Junior Preferred Stock or Company Common
Stock or for other
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securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, instruction, direction,
consent, certificate, statement or other paper or document believed by it to be
genuine and to have been signed, executed and, where necessary, verified or
acknowledged by the proper Person or Persons.
SECTION 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS
AGENT. (a) Any corporation into which the Rights Agent or any successor Rights
Agent may be merged or with which it may be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any corporation succeeding to the
corporate trust or shareholder services businesses 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 document 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 21 hereof. In case at the time such successor Rights Agent
shall succeed to the agency created by this Agreement, any of the Rights
Certificates shall have been countersigned but not delivered, any such
successor Rights Agent may adopt the countersignature of a predecessor Rights
Agent and deliver such Rights 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
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and deliver Rights Certificates so countersigned; and in case at that time any
of the Rights Certificates shall not have been countersigned, the Rights Agent
may countersign such Rights Certificates either in its prior name or in its
changed name; and in all such cases such Rights Certificates shall have the
full force provided in the Rights Certificates and in this Agreement.
SECTION 20. DUTIES OF RIGHTS AGENT. The Rights Agent undertakes the
duties and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the holders of Rights 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 and the
determination of "current market price") be proved or established by the
Company prior to taking or suffering any action hereunder, such fact or matter
(unless other evidence in respect thereof be specified herein) may be deemed to
be conclusively proved and established by a certificate signed by the Chairman
of the Board, the President, any Vice President, the Treasurer, any Assistant
Treasurer, the Secretary or any Assistant Secretary of the Company and
delivered to the Rights Agent; provided, however, that so long as any Person is
an Acquiring Person hereunder, such certificate shall be signed and delivered
by a majority of the Continuing Directors; 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.
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(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 have any responsibility for the
validity of this Agreement or the execution and delivery hereof (except the due
execution hereof by the Rights Agent) or for 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 failure by the
Company to satisfy conditions contained in this Agreement or in any Rights
Certificate; nor shall it be responsible for any adjustment required under the
provisions of Section 11 or Section 13 hereof or 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 by the Rights Agent of
the certificate describing any such adjustment contemplated by Section 12); nor
shall it be responsible for any determination by the Board of Directors by
Board Approval of Current Value or Spread pursuant to the provisions of Section
11(a)(iii) or the current market price of the Junior Preferred Stock, Company
Common Stock or any other security pursuant to the provisions of Section 11(d);
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 Junior
Preferred Stock or any other securities to be issued pursuant to this Agreement
or any Rights Certificate or as to whether any shares of Junior Preferred Stock
or any other securities will, when so issued, be validly authorized and issued,
fully paid and non-assessable; nor shall it be liable for
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any federal or state transfer taxes or charges that may be due upon the
issuance or transfer of any shares of Junior Preferred Stock, Company Common
Stock or other securities or any Rights Certificate.
(f) The Company shall perform, execute, acknowledge and deliver or
cause to be performed, executed, acknowledged and delivered all such further
acts, instruments and assurances as may reasonably be required by the Rights
Agent for the performance by the Rights Agent of its duties under 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 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;
provided, however, that so long as any Person is an Acquiring Person hereunder,
the Rights Agent shall accept such instructions and advice only from a majority
of the Continuing Directors and shall not be liable for any action taken or
suffered to be taken by it in good faith in accordance with such instructions
of the majority of the Continuing Directors. 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 Rights Agreement and the date on and/or after
which such action shall be taken or such omission shall be effective. The
Rights Agent shall not be liable for any action taken by, or omission of, the
Rights Agent in accordance with a proposal included in any such application on
or after the date specified in such application (which date shall not be less
than five Business Days after the date any such officer of the Company actually
receives such application, unless any such officer shall have consented in
writing to an earlier date) unless,
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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.
(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 or in the exercise of its rights hereunder
if the Rights Agent shall have 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 Rights 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, not signed 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 or transfer without first consulting with
the Company. If such certificate has been completed and signed and shows a
negative response to clauses 1 and 2 of such certificate, unless previously
instructed otherwise in writing by the Company (which
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instructions may impose on the Rights Agent additional ministerial
responsibilities, but no discretionary responsibilities), the Rights Agent may
assume without further inquiry that the Rights Certificate is not owned by a
person described in Section 4(b) or Section 7(e) hereof and shall not be
charged with any knowledge to the contrary.
SECTION 21. CHANGE OF RIGHTS AGENT. The Rights Agent or any
successor Rights Agent may resign and be discharged from its duties under this
Agreement upon 30 days' prior notice in writing mailed to the Company, and to
each transfer agent of the Junior Preferred Stock and the Company Common 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 30 days'prior notice in writing, mailed to the Rights Agent
or successor Rights Agent, as the case may be, and to each transfer agent of
the Junior Preferred Stock and the Company Common 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 30 days
after giving notice of such removal or after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Rights Agent
or by the holder of a Rights Certificate (who shall, with such notice, submit
his Rights Certificate for inspection by the Company), then any registered
holder of any Rights Certificate may apply to any court of competent
jurisdiction for the appointment of a new Rights Agent. Any successor Rights
Agent, whether appointed by the Company or by such a court, shall be (a) a
corporation organized and doing business under the laws of the United States or
the States of Texas or New York in good standing, shall be authorized to do
business as a banking institution in the State of New York, shall be authorized
under such laws to exercise corporate trust or stock transfer powers, shall be
subject to supervision or examination by
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federal or state authorities and shall have 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 corporation described in clause (a). 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 Junior Preferred Stock
and the Company Common Stock, and mail a notice thereof in writing to the
registered holders of the Rights Certificates. Failure to give any notice
provided for in this Section 21, however, or any defect therein, shall not
affect the legality or validity of the resignation or removal of the Rights
Agent or the appointment of the successor Rights Agent, as the case may be.
SECTION 22. ISSUANCE OF NEW RIGHTS CERTIFICATES. Notwithstanding any
of the provisions of this Agreement or 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 the Board of Directors by Board Approval to reflect
any adjustment or change made in accordance with the provisions of this
Agreement in the Purchase Price or the number or kind or class of shares or
other securities or property that may be acquired under the Rights
Certificates. In addition, in connection with the issuance or sale of shares
of Company Common Stock following the Distribution Date and prior to the
Expiration Date, the Company (a) shall, with respect to shares of Company
Common Stock so issued or sold pursuant to the exercise of stock options or
under any employee plan or arrangement, or upon the exercise, conversion or
exchange of securities hereinafter issued by the Company, and
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(b) may, in any other case, if deemed necessary or appropriate by the Board of
Directors by Board Approval, issue Rights Certificates representing the
appropriate number of Rights in connection with such issuance or sale;
provided, however, that (i) no such Rights Certificate shall be issued if, and
to the extent that, the Company shall be advised by counsel that such issuance
would create a significant risk of material adverse tax consequences to the
Company or the person to whom such Rights Certificate would be issued, and (ii)
no such Rights Certificate shall be issued if, and to the extent that,
appropriate adjustment shall otherwise have been made in lieu of the issuance
thereof.
SECTION 23. REDEMPTION AND TERMINATION. (a) Subject to Section 30
hereof, the Company may, at its option, by the Board of Directors acting by
Board Approval, at any time prior to the earlier of (i) the Close of Business
on the tenth day following the Stock Acquisition Date, or (ii) the Close of
Business on the Final Expiration Date, redeem all but not less than all of the
then outstanding Rights at a redemption price of $.Ol 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"), and the Company may,
at its option, by the Board of Directors acting by Board Approval, pay the
Redemption Price either in cash, shares of Company Common Stock (based on the
"current market price", as defined in Section 11(d) hereof, of the shares of
Company Common Stock at the time of redemption) or any other form of
consideration deemed appropriate by the Board of Directors by Board Approval.
(b) Immediately upon the action of the Board of Directors by Board
Approval ordering the redemption of the Rights, evidence of which shall be
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
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Rights shall be to receive the Redemption Price for each Right so held.
Promptly after the action of the Board of Directors by Board Approval 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 Company 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. Neither the Company nor any of its Affiliates or Associates may redeem,
acquire or purchase for value any Rights at any time in any manner other than
that specifically set forth in this Section 23, and other than in connection
with the purchase or acquisition of Company Common Stock prior to the
Distribution Date.
SECTION 24. NOTICE OF CERTAIN EVENTS. (a) In case the Company shall
propose, at any time after the Distribution Date, (i) to pay any dividend
payable in stock of any class to the holders of Junior Preferred Stock or to
make any other distribution to the holders of Junior Preferred Stock (other
than a regular quarterly cash dividend out of earnings or retained earnings of
the Company), (ii) to offer to the holders of Junior Preferred Stock rights or
warrants to subscribe for or to purchase any additional shares of Junior
Preferred Stock or shares of stock of any class or any other securities, rights
or options, (iii) to effect any reclassification of its Junior Preferred Stock
(other than a reclassification involving only the subdivision of outstanding
shares of Junior Preferred Stock), (iv) to effect any consolidation or merger
into or with any other Person (other than a Subsidiary of the Company in a
transaction which complies with Section 11(o) hereof), or to effect any sale or
other transfer (or to permit one or more of its Subsidiaries to effect any sale
or other
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transfer), in one or more transactions, of more than 50% of the assets or
earning power of the Company and its Subsidiaries (taken as a whole) to any
other Person or Persons (other than the Company and/or any of its Subsidiaries
in one or more transactions each of which complies with Section 11(o) hereof),
or (v) to effect the liquidation, dissolution or winding up of the Company,
then, in each such case, the Company shall give to each holder of a Rights
Certificate, to the extent feasible and in accordance with Section 25 hereof, a
notice of such proposed action, which shall specify the record date for the
purposes of such stock dividend, distribution of rights or warrants, or the
date on which such reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution, or winding up is to take place and the date of
participation therein by the holders of the shares of Junior 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 20 days prior to the
record date for determining holders of the shares of Junior Preferred Stock for
purposes of such action, and in the case of any such other action, at least 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 Junior Preferred Stock
whichever shall be the earlier; provided, however, no such notice shall be
required pursuant to this Section 24, if any Subsidiary of the Company effects
a consolidation or merger with or into, or effects a sale or other transfer of
assets or earning power to, any other Subsidiary of the Company.
(b) In case any of the events set forth in Section 11(a)(ii)
hereof shall occur, then, in any such case, (i) the Company shall as soon as
practicable thereafter give to each holder of a Rights Certificate, to the
extent feasible and in accordance with Section 25 hereof, a notice of the
occurrence of such event, which shall specify the event and the consequences of
the event to holders of Rights under Section 11(a)(ii) hereof.
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SECTION 25. NOTICES. All notices and other communications provided
for hereunder shall, unless otherwise stated herein, be in writing (including
any telex, telegram or cable) and mailed or sent or delivered, if to the
Company, at its address at:
Rowan Companies, Inc.
5450 Transco Tower
2800 Post Oak Boulevard
Houston, Texas 77056-6196
Attention: Secretary
And if to the Rights Agent, at its address at:
Citibank, N.A.
111 Wall Street
5th Floor, Equity Administration
New York, New York 10043
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 Company 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 or the Rights Agent,
as the case may be.
SECTION 26. SUPPLEMENTS AND AMENDMENTS. Prior to the Distribution
Date and subject to the penultimate sentence of this Section 26, the Company
and the Rights Agent shall, if the Company so directs, supplement or amend any
provision of this Agreement without the approval of any holders of certificates
representing shares of Company Common Stock. From and after the Distribution
Date and subject to the penultimate sentence of this Section 26, the Company
and the Rights Agent shall, if the Company so directs, supplement or amend this
Agreement without the approval of any holders of Rights Certificates in order
(i) to cure any ambiguity, (ii) to correct or supplement any provision
contained herein which may be defective or inconsistent with any other
provisions herein, (iii) to shorten or lengthen any time
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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 or an Affiliate or Associate of an Acquiring Person);
provided, however, this Agreement may not be supplemented or amended to
lengthen, pursuant to clause (iii) of this sentence, (A) subject to Section 30
hereof, 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 or, so long as any
Person is an Acquiring Person hereunder, from the majority of the Continuing
Directors which states that the proposed supplement or amendment is in
compliance with the terms of this Section 26, the Rights Agent shall execute
such supplement or amendment. Notwithstanding anything contained in this
Agreement to the contrary, no supplement or amendment shall be made which
changes the Redemption Price, the Purchase Price, the Expiration Date or the
number of Units of Junior Preferred Stock for which a Right is exercisable
without the approval of a majority of the Continuing Directors. Prior to the
Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Company Common Stock.
SECTION 27. SUCCESSORS. All the covenants and provisions of
this Agreement by or for the benefit of the Company or the Rights Agent shall
bind and inure to the benefit of their respective successors and assigns
hereunder.
SECTION 28. DETERMINATIONS AND ACTIONS BY THE BOARD OF
DIRECTORS, ETC. For all purposes of this Agreement, any calculation of the
number of shares of Company Common Stock outstanding at any particular time,
including for purposes of determining the particular percentage of such
outstanding shares of Company
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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 as in effect on the date hereof. Except
as otherwise specifically provided herein, the Board of Directors of the
Company shall have the exclusive power and authority to administer this
Agreement and to exercise all rights and powers specifically granted to the
Board or to the Company, or as may be necessary or advisable in the
administration of this Agreement, including, without limitation, the right and
power (i) to interpret the provisions of this Agreement, and (ii) to make all
determinations deemed necessary or advisable for the administration of this
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 by a majority of the
Continuing Directors in good faith, shall (x) be final, conclusive and binding
on the Company, the Rights Agent, the holders of the Rights and all other
parties, and (y) not subject the Board or any member thereof to any liability
to the holders of the Rights.
SECTION 29. BENEFITS OF THIS AGREEMENT. Nothing in this
Agreement shall be construed to give to any Person other than the Company, the
Rights Agent and the registered holders of the Rights Certificates (and, prior
to the Distribution Date, registered holders of shares of Company Common Stock)
any legal or equitable right, remedy or claim under this Agreement; but this
Agreement shall be for the sole and exclusive benefit of the Company, the
Rights Agent and the registered holders of the Rights Certificates (and, prior
to the Distribution Date, registered holders of shares of Company Common
Stock).
SECTION 30. 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
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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 by Board Approval
determines in its good faith judgment that severing the invalid language from
this Agreement would adversely affect the purpose or effect of this Agreement
and the Rights shall not then be redeemable, the right of redemption set forth
in Section 23 hereof shall be reinstated and shall not expire until the Close
of Business on the tenth day following the date of such determination by a
majority of the Continuing Directors.
SECTION 31. GOVERNING LAW. THIS AGREEMENT, EACH RIGHT AND EACH
RIGHTS CERTIFICATE ISSUED HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO CONTRACTS
EXECUTED IN AND TO BE PERFORMED ENTIRELY IN SUCH STATE.
SECTION 32. COUNTERPARTS. This Agreement may be executed in one
or more counterparts, and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original,
but all of which taken together shall constitute one and the same instrument.
SECTION 33. DESCRIPTIVE HEADINGS. The headings contained in
this Agreement are for descriptive purposes only and shall not affect in any
way the meaning or interpretation of this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be daily executed, all as of the date first above written.
ATTEST: ROWAN COMPANIES, INC.
By: /s/ MARK H. HAY By: /s/ E.E. THIELE
Name: Mark H. Hay Name: E.E. Thiele
Title: Corporate Secretary Title: Vice President
ATTEST: CITIBANK, N.A.
By: /s/ JOHN W. REASOR By: /s/ P. DEFELICE
Name: John W. Reasor Name: P. Defelice
Title: Assistant Vice President Title: Vice President
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