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EXHIBIT 4.2
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NEW NISOURCE INC.
and
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
Rights Agent
Form
of
Rights Agreement
Dated as of _________ __, 2000
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TABLE OF CONTENTS
Page
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Section 1. Certain Definitions....................................................................2
Section 2. Appointment of Rights Agent............................................................5
Section 3. Issue of Right Certificates............................................................5
Section 4. Form of Right Certificate..............................................................6
Section 5. Countersignature and Registration......................................................7
Section 6. Transfer, Split Up, Combination and Exchange of Right Certificate, Mutilated,
Destroyed, Lost or Stolen Right Certificates...........................................7
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights..........................8
Section 8. Cancellation and Destruction of Right Certificates....................................10
Section 9. Reservation and Availability of Preferred Stock.......................................10
Section 10. Preferred Stock Record Date...........................................................12
Section 11. Adjustment of Purchase Price; Number of Shares or Number of Rights....................12
Section 12. Certificate of Adjusted Purchase Price or Number of Shares............................19
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power..................20
Section 14. Fractional Rights and Fractional Shares...............................................22
Section 15. Rights of Action......................................................................23
Section 16. Agreement of Right Holders............................................................24
Section 17. Right Certificate Holder Not Deemed a Stockholder.....................................24
Section 18. Concerning the Rights Agent...........................................................25
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Section 19. Merger or Consolidation or Change of Name of Rights Agent.............................25
Section 20. Terms and Conditions to Duties of Rights Agent........................................26
Section 21. Change of Rights Agent................................................................28
Section 22. Issuance of New Right Certificates....................................................29
Section 23. Redemption............................................................................30
Section 24. Exchange..............................................................................30
Section 25. Notice of Certain Events..............................................................31
Section 26. Notices...............................................................................32
Section 27. Supplements and Amendments............................................................33
Section 28. Successors............................................................................33
Section 29. Benefits of this Agreement............................................................33
Section 30. Governing Law.........................................................................33
Section 31. Counterparts..........................................................................34
Section 32. Descriptive Headings..................................................................34
Section 33. Severability..........................................................................34
Section 34. Determinations and Actions by the Board of Directors. etc.............................34
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RIGHTS AGREEMENT
This Agreement, dated as of ________ __, 2000, between New NiSource Inc., a
Delaware corporation (the "Company"), and ChaseMellon Shareholder Services,
L.L.C., a New Jersey limited liability company (the "Rights Agent").
W I T N E S S E T H
WHEREAS, the Company, NiSource Inc., an Indiana corporation("NiSource"),
Columbia Energy Group, a Delaware corporation ("Columbia"), Parent Acquisition
Corp., an Indiana corporation, Company Acquisition Corp., a Delaware
corporation, and NiSource Finance Corp., an Indiana corporation are parties to
that certain Agreement and Plan of Merger dated as of February 27, 2000, as
amended and restated as of March 31, 2000 (the "Merger Agreement"), pursuant to
which, among other things, NiSource and Columbia will become wholly owned
subsidiaries of the Company and the former stockholders of NiSource and Columbia
will become stockholders of the Company (the "Merger");
WHEREAS, as a part of the Merger, NiSource [and Columbia] [have] has
determined that it would be desirable to distribute Rights (as hereinafter
defined) associated with the shares of Common Stock (as hereinafter defined) of
the Company to be issued in the Merger to the former stockholders of NiSource
and Columbia and that certificates representing such Common Stock would also
evidence such Rights and that the registered holders of Common Stock would also
be the registered holders of the associated Rights;
WHEREAS, in order to effectuate the foregoing, NiSource, as the sole
stockholder of the Company, has authorized and directed the Company to create a
stockholder rights plan, and to issue Rights to the former stockholders of
NiSource and Columbia in connection with the Merger, which Rights will be
attached to the shares of Common Stock and evidenced by certificates
representing Common Stock;
WHEREAS, the Board of Directors of the Company has authorized the
distribution as of the Effective Time (as defined in the Merger Agreement) of
the Mergers (as defined in the Merger Agreement) of one Preferred Share Purchase
Right (as such number may hereafter be adjusted pursuant to the provisions of
this Agreement) in respect of each share of Common Stock, $.01 par value per
share, of the Company issued in connection with the Mergers, and authorized the
issuance of one Preferred Share Purchase Right in respect of each share of
Common Stock of the Company issued between the Effective Time (whether
originally issued or delivered from the Company's treasury) and the Distribution
Date or the Expiration Date (as such terms are hereinafter defined), each
Preferred Share Purchase Right initially representing the right to purchase one
one-hundredth of a share of Series A Junior Participating Preferred Stock (as
hereinafter defined) upon the terms and subject to the conditions hereinafter
set forth (individually a Right and collectively the Rights);
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth, the parties hereby agree as follows:
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Section 1. Certain Definitions. For purposes of this Agreement, the
following terms have the meanings indicated:
(a) "Acquiring Person" shall mean any Person (as such term is hereinafter
defined) who or which, together with all Affiliates (as such term is hereinafter
defined) and Associates (as such term is hereinafter defined) of such Person, is
or becomes the Beneficial Owner (as such term is hereinafter defined) of a
Substantial Block (as such term is hereinafter defined), but shall not include
the Company, any subsidiary of or other Person controlled by the Company, any
employee benefit plan of the Company or of any subsidiary of the Company or any
Person appointed as trustee by the Company or such subsidiary pursuant to the
terms of any such plan in that Person's capacity as trustee. Notwithstanding the
foregoing, no Person shall become an Acquiring Person solely as a result of an
acquisition of Common Stock and/or other securities by the Company which, by
reducing the number of outstanding share of Common Stock and/or other
securities, causes the share of Common Stock and/or other securities of the
Company beneficially owned by such Person to constitute a Substantial Block;
provided, however, that if after such acquisitions by the Company, such Person
becomes the Beneficial Owner of any additional shares of Common Stock and/or
other securities of the Company and is the Beneficial Owner of a Substantial
Block, then such Person shall be deemed to be an Acquiring Person.
(b) "Adjustment Shares" shall have the meaning set forth in Section
11(a)(ii) hereof.
(c) "Affiliate" and "Associate" shall have the respective meanings ascribed
to such terms in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934 (the "Exchange Act"), as in effect on the date
of this Agreement, but shall not include the Company, any subsidiary of or other
Person controlled by the Company, any employee benefit plan of the Company or of
any subsidiary of the Company or any Person appointed as trustee by the Company
or such subsidiary pursuant to the terms of any such plan in that Person's
capacity as trustee.
(d) A Person shall be deemed the "Beneficial Owner" of and shall be deemed
to "beneficially own" any securities:
(i) which such Person or any of such Person's Affiliates or Associates
directly or indirectly has "beneficial ownership," as determined pursuant
to Rule 13d-3 and Rule 13d-5 of the General Rules and Regulations under
the Exchange Act, as in effect on the date of this Agreement;
(ii) which such Person or any of such Person's Affiliates or
Associates has (A) the right to acquire (whether such right is exercisable
immediately or only after the passage of time) pursuant to any agreement,
arrangement or understanding (whether or not in writing and 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,
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warrants or options, or otherwise; provided, however, that a Person shall
not be deemed, pursuant to this clause (ii), to be the Beneficial Owner of,
or to beneficially own, (I) securities tendered pursuant to a tender or
exchange offer made by or on behalf of such Person or any of such Person's
Affiliates or Associates until such tendered securities are accepted for
purchase or exchange, (II) securities issuable upon exercise of Rights at
any time prior to the occurrence of a Section 11(a)(ii) Event or a Section
13(a) Event, or (III) securities issuable upon exercise of Rights from and
after the occurrence of a Section 11(a)(ii) Event or a Section 13(a) Event
but only if such Rights were acquired by such Person or any of such
Person's Affiliates or Associates prior to the Distribution Date or
pursuant to Section 3(a) or Section 22 hereof ("Original Rights") or
pursuant to Section 11(i) hereof in connection with an adjustment made with
respect to any Original Rights; or (B) the right (whether sole or shared)
to vote or dispose of pursuant to any agreement, arrangement or
understanding (whether or not in writing); provided, however, that a Person
shall not be deemed the Beneficial Owner of, or to beneficially own, any
security under this clause (B) pursuant to an agreement, arrangement or
understanding to vote such security that (1) arises solely from a revocable
proxy or consent given in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the Exchange Act and
the rules and regulations thereunder and (2) is not also then required to
be reported as beneficially owned on a Schedule 13D under the Exchange Act
(or any comparable or successor statement or report); or
(iii) which are beneficially owned, directly or indirectly, by any
other Person (or any Affiliate or Associate thereof) with which such Person
or any of such Person's Affiliates or Associates has any agreement,
arrangement or understanding (whether or not in writing and 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 clause (B) of subparagraph (ii) of this paragraph (d)) or
disposing of any securities of the Company.
Notwithstanding the foregoing, nothing in this Section 1(d) shall cause a Person
engaged in business as an underwriter of securities to be the Beneficial Owner
of, or to beneficially own, any securities acquired through such Person's
participation in good faith in a firm commitment underwriting until the
expiration of 40 days after the date of such acquisition.
(e) "Business Day" shall mean any day other than a Saturday, Sunday or a
day on which banking institutions in the State of New Jersey or the city in
which the office of the Rights Agent is located are authorized or obligated by
law or executive order to close.
(f) "Close of Business" on any given date shall mean 5:00 P.M., New Jersey
time, on such date; provided, however, that if such date is not a Business Day
it shall mean 5:00 P.M., New Jersey time, on the next succeeding Business Day.
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(g) "Common Stock" when used with reference to the Company shall mean the
shares of Common Stock, $.01 par value per share, of the Company. "Common Stock"
when used with reference to any Person other than the Company shall mean the
capital stock with the greatest aggregate voting power (or the equity securities
or other equity interests having power to control or direct the management) of
such Person or, if such Person is a subsidiary of or controlled by another
Person, the Person which ultimately controls such first-mentioned Person.
(h) "Distribution Date" shall have the meaning set forth in Section 3(a)
hereof.
(i) "Expiration Date" shall have the meaning set forth in Section 7(a)
hereof.
(j) "Final Expiration Date" shall have the meaning set forth in Section
7(a) hereof.
(k) "Original Shares" shall have the meaning set forth in Section 11
(a)(ii) hereof.
(l) "Person" shall mean any individual, firm, corporation, partnership,
trust, syndicate, limited liability company or other entity, and shall include
any successor (by merger or otherwise) of such entity.
(m) "Preferred Stock" shall mean the shares of Series A Junior
Participating Preferred Stock, without par value, of the Company having the
rights and preferences set forth in the Amended and Restated Certificate of
Incorporation of the Company.
(n) "Purchase Price" shall have the meaning set forth in Section 7(b)
hereof.
(o) "Section 11(a)(ii) Event" shall mean any event described in Section
11(a)(ii) hereof.
(p) "Section 13 Event" shall mean any event described in clause (i), (ii)
or (iii) of Section 13(a) hereof.
(q) "Stock Acquisition Date" shall mean the first date of public
announcement (which, for purposes of this definition, shall include, without
limitation, a report filed pursuant to Section 13(d) under the Exchange Act) by
the Company or an Acquiring Person that an Acquiring Person has become such.
(r) "Subsidiary" of any Person shall mean any corporation or other entity
of which a majority of the voting power of the voting equity securities or
equity interest is owned, directly or indirectly, by such Person.
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(s) "Substantial Block" shall mean a number of shares of Common Stock of
the Company and/or a number of shares of stock or amount of other securities of
the Company which in the aggregate represents 25% or more of the Voting Power.
(t) "Voting Power" shall mean the voting power of all securities of the
Company then outstanding generally entitled to vote for the election of
directors of the Company.
Section 2. Appointment of Rights Agent. The Company hereby appoints the
Rights Agent to act as agent for the Company in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such Co-Rights Agents as it may deem
necessary or desirable. The Rights Agent shall have no duty to supervise, and in
no event shall be liable for, the acts or omissions of any such Co-Rights Agent.
Section 3. Issue of Right Certificates.
(a) Until the earlier of (i) the tenth business day after the Stock
Acquisition Date, or (ii) the tenth Business Day (or such later date as may be
determined by action of the Board of Directors prior to such time as any Person
becomes an Acquiring Person) after the commencement of, or first public
announcement of the intent of any Person (other than the Company or any of its
subsidiaries or any employee benefit plan of the Company or of any subsidiary of
the Company or any Person appointed as trustee by the Company or such subsidiary
pursuant to the terms of any such plan in such Person's capacity as trustee) to
commence, a tender or exchange offer which would result in such Person becoming
an Acquiring Person (the earlier of such days being herein referred to as the
"Distribution Date"), (x) the Rights will be evidenced by the certificates for
the Common Stock of the Company registered in the names of the holders of the
Common Stock (which certificates for Common Stock shall be deemed also to be
Right Certificates) and not by separate Right Certificates, and (y) the right to
receive Right Certificates will be transferable only in connection with the
transfer of Common Stock. As soon as practicable after the Distribution Date,
the Rights Agent will send, by first-class, insured, postage prepaid mail, at
the expense of the Company, to each record holder of the Common Stock as of the
Close of Business on the Distribution Date, at the address of such holder shown
on the records of the Company, a Right Certificate, in substantially the form of
Exhibit A hereto, evidencing one Right for each Common Stock so held. As of and
after the Distribution Date, the Rights will be evidenced solely by such Right
Certificates.
(b) Rights shall be issued in respect of all shares of Common Stock which
are issued after the Effective Time but prior to the earlier of the Distribution
Date or the Expiration Date or, in certain circumstances provided in Section 22
hereof, after the Distribution Date. Certificates representing such shares of
Common Stock shall be deemed to be certificates for Rights and shall have
impressed on, printed on, written on or otherwise affixed to them the following
legend:
This certificate also evidences and entitles the holder hereof to certain
Rights as set forth in a Rights Agreement between New NiSource Inc. and
ChaseMellon
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Shareholder Services, L.L.C., dated as of ________ __, 2000 (the "Rights
Agreement"), the terms of which are hereby incorporated herein by reference
and a copy of which is on file at the principal executive offices of New
NiSource Inc. Under certain circumstances, as set forth in the Rights
Agreement, such Rights will be evidenced by separate certificates and will
no longer be evidenced by this certificate. New NiSource Inc. will mail to
the holder of this certificate a copy of the Rights Agreement without
charge promptly upon receipt of a written request therefor. Under certain
circumstances, Rights beneficially owned 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 then held by or on
behalf of such Person or by any subsequent holder, may become null and
void.
With respect to such certificates containing the foregoing legend, until the
earlier of the Distribution Date or the Expiration Date, the Rights associated
with the Common Stock represented by such certificates shall be evidenced by
such certificates alone, and the surrender for transfer of any of such
certificates shall also constitute the transfer of the Rights associated with
the Common Stock represented by such certificate.
Section 4. Form of Right Certificate.
(a) The Right Certificates (and the forms of election to purchase shares
and of assignment to be printed on the reverse thereof) shall be substantially
the same as 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, which do not affect the duties and
responsibilities of the Rights Agent and as are not inconsistent with the
provisions of this Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with any
rule or regulation of any stock exchange on which the Rights may from time to
time be listed, or to conform to usage. Subject to the provisions of Section 22
hereof, the Right Certificates, whenever issued, shall be dated as of the
Effective Time, and on their face shall entitle the holders thereof to purchase
such number of one one-hundredths of a share of Preferred Stock as shall be set
forth therein at the Purchase Price (as defined in Section 7(b)), but the number
of such one one-hundredths of a share and the Purchase Price shall be subject to
adjustments as provided herein.
(b) Any Right Certificate that represents Rights beneficially owned by an
Acquiring Person or any Associate or Affiliate of an Acquiring Person, or any
transferee of an Acquiring Person or any Associate or Affiliate of an Acquiring
Person under the circumstances set forth in Section 7(e), and any Right
Certificate issued upon transfer, exchange, replacement or adjustment of any
other Right Certificate referred to in this sentence, shall contain (to the
extent feasible) the following legend:
The Rights represented by this Certificate are or were beneficially owned
by a Person who was or became an Acquiring
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Person or an Affiliate or Associate of an Acquiring Person (as such terms
are defined in the Rights Agreement). This Right Certificate and the Rights
represented hereby may become void in the circumstances specified in
Section 7(e) of the Rights Agreement.
Section 5. Countersignature and Registration.
(a) The Right Certificates shall be executed on behalf of the Company by
the Chairman, the President or any Vice President of the Company, either
manually or by facsimile signature, and have affixed thereto the Company's seal
or a facsimile thereof which shall be attested by the Secretary or an Assistant
Secretary of the Company, either manually or by facsimile signature. The Right
Certificates shall be countersigned by the Rights Agent manually or by facsimile
and shall not be valid for any purpose unless so countersigned. In case any
officer of the Company who shall have signed any of the Right Certificates shall
cease to be such officer of the Company before countersignature by the Rights
Agent and issuance and delivery by the Company, such Right Certificates,
nevertheless, may be countersigned by the Rights Agent, issued and delivered
with the same force and effect as though the person who signed such Right
Certificates had not ceased to be such officer of the Company; and any Right
Certificate may be signed on behalf of the Company by any person who, at the
actual date of the execution of such Right Certificate, shall be a proper
officer of the Company to sign such Right Certificate, although at the date of
the execution of this Rights Agreement any such person was not such an officer.
(b) Following the Distribution Date and receipt by the Rights Agent of all
necessary information, the Rights Agent will keep or cause to be kept, at its
shareholder services offices in Ridgefield Park, New Jersey, books for
registration and transfer of the Right Certificates issued hereunder. Such books
shall show the names and addresses of the respective holders of the Right
Certificates, the number of Rights evidenced on its face by each of the Right
Certificates and the date of each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificate, Mutilated, Destroyed, Lost or Stolen Right Certificates.
(a) Subject to the provisions of Section 14 hereof, at any time after the
Close of Business on the Distribution Date, and at or prior to the Close of
Business on the Expiration Date, any Right Certificate or Certificates may be
transferred, split up, combined or exchanged for another Right Certificate or
Right Certificates, entitling the registered holder to purchase a like number of
one one-hundredths of a share of Preferred Stock (or, following the occurrence
of an event set forth in Section 11(a)(ii) or Section 13(a), shares of Common
Stock and/or other securities) as the Right Certificate or Right Certificates
surrendered then entitled such holder to purchase. Any registered holder
desiring to transfer, split up, combine or exchange any Right Certificate shall
make such request in writing delivered to the Rights Agent, and shall surrender
the Right Certificate or Right Certificates to be transferred, split up,
combined or exchanged at the principal office of the Rights Agent. Thereupon the
Rights Agent shall countersign and deliver to the Person entitled thereto a
Right Certificate or Right Certificates, as the case may be, as so requested.
The Company may require
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payment of a sum sufficient to cover any tax or charge that may be imposed in
connection with any transfer, split up, combination or exchange of Right
Certificates. The Rights Agent shall have no duty or obligation under this
Section unless and until it is satisfied that all such taxes and/or charges have
been paid.
(b) Upon receipt by the Company and the Rights Agent of evidence reasonably
satisfactory to them of the loss, theft, destruction or mutilation of a Right
Certificate, and, in case of loss, theft or destruction, of indemnity or
security satisfactory to them (if requested by the Company), and reimbursement
to the Company and the Rights Agent of all reasonable expenses incidental
thereto, and upon surrender to the Rights Agent and cancellation of the Right
Certificate if mutilated, the Company will make and deliver a new Right
Certificate of like tenor to the Rights Agent for delivery to the registered
owner in lieu of the Right Certificate so lost, stolen, destroyed or mutilated.
Section 7. Exercise of Rights; Purchase Price; Expiration Date of Rights.
(a) The registered holder of any Right Certificate may exercise the Rights
evidenced thereby (except as otherwise provided herein) in whole or in part at
any time after the Distribution Date, upon surrender of the Right Certificate,
with the form of election to purchase on the reverse side thereof duly and
properly executed, to the Rights Agent at the office of the Rights Agent,
together with payment of the Purchase Price for each one one-hundredth of a
share of Preferred Stock as to which the Rights are exercised, at or prior to
the Close of Business on the earliest of (i)________ __, 2010 (the "Final
Expiration Date"), (ii) the date on which the Rights are redeemed pursuant to
Section 23, (iii) consummation of a transaction pursuant to Section 13(g) (such
earliest date being herein referred to as the "Expiration Date") or (iv) the
time at which such Rights are exchanged pursuant to Section 24.
(b) The purchase price for each one one-hundredth of a share of Preferred
Stock (the "Purchase Price") pursuant to the exercise of a Right shall initially
be $60, shall be subject to adjustment from time to time as provided in Section
11 and shall be payable in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing exercisable Rights,
with the form of election to purchase duly and properly executed, accompanied by
payment of the Purchase Price for the shares to be purchased, and an amount
equal to any applicable tax or charge in cash, or by certified check or bank
draft payable to the order of the Company, the Rights specified in the election
shall be exercised, and the Rights Agent shall thereupon promptly (i) (A)
requisition from any transfer agent of the Preferred Stock (or make available,
if the Rights Agent is the transfer agent) certificates for the number of whole
shares of Preferred Stock to be purchased (and the Company hereby irrevocably
authorizes its transfer agent to comply with all such requests) or (B) if the
Company shall have elected to deposit the total number of shares of Preferred
Stock issuable upon exercise of the Rights hereunder with a depositary agent,
requisition from the depositary agent for the Preferred Stock depositary
receipts representing such number of one one-hundredths of a share of Preferred
Stock as are to be purchased (and the Company hereby irrevocably authorizes its
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depositary agent to comply with all such requests), in which case certificates
for the Preferred Stock represented by such receipts shall be deposited by the
transfer agent with the depositary agent, (ii) when appropriate, requisition
from the Company the amount of cash to be paid in lieu of issuance of fractional
shares in accordance with Section 14, (iii) promptly after receipt of such
certificates, cause the same to be delivered to or upon the order of the
registered holder of such Right Certificate, registered in such name or names as
may be designated by such holder and (iv) when appropriate, after receipt
promptly deliver such cash to or upon the order of the registered holder of such
Right Certificate. The payment of the Purchase Price may be made (x) in cash or
by certified bank check or bank draft payable to the order of the Company, or
(y) at the Company's option, by delivery of a certificate or certificates (with
appropriate share powers executed in blank attached thereto) evidencing a number
of shares of Common Stock equal to the then Purchase Price divided by the
closing price (as determined pursuant to Section 11(d) hereof) per share of
Common Stock on the Trading Day immediately preceding the date of such exercise.
In the event that the Company is obligated to issue other securities (including
shares of Common Stock) of the Company, pay cash and/or distribute other
property pursuant to Section 11(a) hereof, the Company will make all
arrangements necessary so that such other securities, cash and/or other property
are available for distribution by the Rights Agent, if and when appropriate.
(d) In case the registered holder of any Right Certificate shall exercise
less than all the Rights evidenced thereby, a new Right Certificate evidencing
Rights equivalent to the Rights remaining unexercised shall be issued by the
Rights Agent to the registered holder of such Right Certificate or to his duly
authorized assigns, subject to the provisions of Section 14.
(e) Notwithstanding the foregoing, upon the occurrence of a Section
11(a)(ii) Event or a Section 13(a) Event, any Rights that are or were on or
after the Distribution Date beneficially owned by (i) an Acquiring Person or any
Associate or Affiliate of an Acquiring Person, (ii) a transferee of an Acquiring
Person (or such Associate or Affiliate) who becomes a transferee after the
Acquiring Person becomes such, or (iii) a transferee of an Acquiring Person (or
such Associate or Affiliate) who becomes a transferee prior to or concurrently
with the Acquiring Person becoming such and receives such Rights pursuant to
either (A) a transfer (whether or not for consideration) from the Acquiring
Person to holders of equity interests in such Acquiring Person (or such
Associate or Affiliate) or to any Person with whom the Acquiring Person (or such
Associate or Affiliate) has any agreement, arrangement or understanding (whether
or not in writing) regarding the transferred Rights or (B) a transfer which is
part of a plan, arrangement or understanding (whether or not in writing) which
has as a primary purpose or effect avoidance of this Section 7(e), shall become
null and void and any holder of such Rights shall thereafter have no right to
exercise such Rights under any provision of this Agreement. The Company shall
use all reasonable efforts to insure that the provisions of this Section 7(e)
are complied with, but shall have no liability to any holder of Right
Certificate or to any other Person as a result of its failure to make any
determinations with respect to any Acquiring Person or any of their respective
Affiliates, Associates or transferees hereunder.
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(f) Notwithstanding anything in this Agreement to the contrary, the Rights
shall not be effectively exercised and neither the Rights Agent nor the Company
shall be obligated to undertake any action with respect to a registered holder
upon the occurrence of any purported exercise as set forth in this Section 7,
unless such registered holder shall have (i) completed and signed the
certificate contained in the form of election to purchase set forth on the
reverse side of the Right Certificate surrendered for such exercise, and (ii)
provided such additional evidence of the identity of the Beneficial Owner (or
former Beneficial Owner) or Affiliates or Associates thereof as the Company or
the Rights Agent shall reasonably request.
Section 8. Cancellation and Destruction of Right Certificates. All Right
Certificates surrendered for the purpose of exercise, transfer, split up,
combination or exchange shall, if surrendered to the Company or to any of its
agents, be delivered to the Rights Agent for cancellation or in canceled form,
or, if surrendered to the Rights Agent, shall be canceled by it, and no Right
Certificates shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Rights Agreement. The Company shall deliver to the
Rights Agent for cancellation and retirement, and the Rights Agent shall so
cancel and retire, any other Right Certificate purchased or acquired by the
Company otherwise than upon the exercise thereof. The Rights Agent shall deliver
all canceled Right Certificates to the Company, or shall at the written request
of the Company, destroy such canceled Right Certificates, and in such case shall
deliver a certificate of destruction thereof to the Company.
Section 9. Reservation and Availability of Preferred Stock.
(a) The Company covenants and agrees that it will cause to be reserved and
kept available, and not reserved for other purposes, out of its authorized and
unissued shares of Preferred Stock or its authorized and issued shares of
Preferred Stock held in its treasury (and, following the occurrence of a Section
11(a)(ii) Event or a Section 13(a) Event, out of its authorized and unissued
shares of Common Stock and/or other securities or out of its authorized and
issued shares of Common Stock and/or other securities held in its treasury), the
number of shares of Preferred Stock (and, following the occurrence of a Section
11(a)(ii) Event or a Section 13(a) Event, shares of Common Stock and/or other
securities) that will be sufficient to permit the exercise in full of all
outstanding Rights.
(b) If and so long as the Preferred Stock (or depositary receipts therefor)
(and, following the occurrence of a Section 11(a)(ii) Event or a Section 13(a)
Event, shares of Common Stock and/or other securities) issuable upon the
exercise of Rights may be listed on any national securities exchange, the
Company shall use its best efforts to cause, from and after the Distribution
Date, all shares reserved for such issuance (or depositary receipts therefor) to
be listed on such exchange upon official notice of issuance upon such exercise.
(c) The Company covenants and agrees that it will take all such action as
may be necessary to insure that all shares of Preferred Stock (and, following
the occurrence of a Section 11(a)(ii) Event or a Section 13(a) Event, shares of
Common Stock and/or other securities) delivered
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upon exercise of Rights shall, at the time of delivery of the certificates for
such shares (subject to payment of the Purchase Price), be duly and validly
authorized and issued and fully paid and nonassessable shares.
(d) The Company further covenants and agrees that it will pay when due and
payable any and all taxes and charges which may be payable in respect of the
issuance or delivery of the Right Certificates or of any shares of Preferred
Stock (and, following the occurrence of a Section 11 (a)(ii) Event or a Section
13(a) Event, shares of Common Stock and/or other securities) upon the exercise
of Rights. The Company shall not, however, be required to pay any tax or charge
which may be payable in respect of any transfer involved in the transfer or
delivery of Right Certificates or the issuance or delivery of certificates or
depositary receipts for Preferred Stock in a name other than that of the
registered holder of the Right Certificate evidencing Rights surrendered for
exercise or to issue or deliver any certificates or depositary receipts for
shares of Preferred Stock upon the exercise of any Rights until any such tax or
charge shall have been paid (any such tax or charge being payable by the holder
of such Right Certificate at the time of surrender) or until it has been
established to the Company's satisfaction that no such tax or charge is due.
(e) The Company shall use its best efforts (i) to file, as soon as
practicable following the first occurrence of a Section 11(a)(ii) Event for
which the consideration to be delivered by the Company upon exercise of the
Rights has been determined in accordance with Section 11(a)(ii) or (iii), or as
soon as is required by law following the Distribution Date, as the case may be,
a registration statement under the Securities Act of 1933 (the "Act"), with
respect to the securities purchasable upon exercise of the Rights on an
appropriate form, (ii) to cause such registration statement to become effective
as soon as practicable after such filing, and (iii) to cause such registration
statement to remain effective (with a prospectus at all times meeting the
requirements of the Act) until the earlier of (A) the date as of which the
Rights are no longer exercisable for such securities, and (B) the Expiration
Date. The Company shall use its best efforts to take such action as may be
appropriate under, or to ensure compliance with, the securities or "blue sky"
laws of the various states in connection with the exercisability of the Rights.
The Company may temporarily suspend, for a period of time not to exceed 90 days
after the date set forth in clause (i) of the first sentence of this paragraph,
the exercisability of the Rights in order to prepare and file such registration
statement and permit it to become effective. Upon any such suspension, the
Company shall issue a public announcement stating that the exercisability of the
Rights has been temporarily suspended, as well as a public announcement at such
time as the suspension is no longer in effect in either case, with prompt notice
thereof to the Rights Agent. Notwithstanding any provision of this Agreement to
the contrary, the Rights shall not be exercisable in any jurisdiction unless the
requisite qualification in such jurisdiction shall have been obtained. (1)
Section 10. Preferred Stock Record Date. Each Person in whose name any
certificate for shares of Preferred Stock is issued upon the exercise of Rights
shall for all purposes be deemed to have become the holder of record of the
Preferred Stock represented thereby on, and such certificate shall be dated, the
date upon which the Right Certificate evidencing such Rights was duly
surrendered and payment of the Purchase Price (and any applicable taxes or
charges) was made
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in accordance with Section 7; provided, however, that if the date of such
surrender and payment is a date upon which the Preferred Stock transfer books of
the Company are closed, such Person shall be deemed to have become the record
holder of such shares on, and such certificate shall be dated, the next
succeeding Business Day on which the Preferred Stock transfer books of the
Company are open. Prior to the exercise of the Rights evidenced thereby, the
holder of a Right Certificate shall not be entitled to any rights of a
stockholder of the Company with respect to shares for which the Rights shall be
exercisable, including, without limitation, the right to vote, to receive
dividends or other distributions or to exercise any preemptive rights, and shall
not be entitled to receive any notice of any proceedings of the Company, except
as provided herein.
Section 11. Adjustment of Purchase Price; Number of Shares or Number of
Rights. The Purchase Price, the number of shares covered by each Right and the
number of Rights outstanding are subject to adjustment from time to time as
provided in this Section 11.
(a) (i) In the event the Company shall at any time after the date of this
Agreement (A) declare or pay a dividend on the Preferred Stock payable in
Preferred Stock, (B) effect a subdivision, combination or consolidation of the
Preferred Stock (by reclassification or otherwise than by payment of dividends
in Preferred Stock) into a greater or lesser number of shares of Preferred Stock
or (C) effect a reclassification or recapitalization of the Preferred Stock into
another class of capital shares (including any such reclassification or
recapitalization 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, reclassification or recapitalization, and the number and kind of
capital shares issuable on such date, shall be proportionately adjusted so that
the holder of any Right exercised after such time shall be entitled to receive
the aggregate number and kind of capital shares, other securities and/or
property which, if such Right had been exercised immediately prior to such date
and at a time when the Preferred Stock transfer books of the Company were open,
such holder would have owned upon such exercise and been entitled to receive by
virtue of such dividend, subdivision, combination, reclassification or
recapitalization. If an event occurs which would require an adjustment under
both Section 11(a)(i) and Section 11(a)(ii), the adjustment provided for in this
Section 11(a)(i) shall be in addition to, and shall be made prior to, any
adjustment required pursuant to Section 11(a)(ii).
(ii) In the event any Person shall, at any time after the date of this
Agreement, become an Acquiring Person, unless the event causing such Person to
become an Acquiring Person is a transaction set forth in Section 13 hereof, or
is an acquisition of Common Stock pursuant to a tender offer or exchange offer
by such Person that (1) is for all outstanding shares of Common Stock and (2) is
at a price and on terms determined by the Board of Directors, after receiving
advice from one or more investment banking firms, to be (I) at a price which is
fair to stockholders (taking into account all factors which such members of the
Board deem relevant including, without limitation, prices which could reasonably
be achieved if the Company or its assets were sold on an orderly basis designed
to realize maximum value) and (II) otherwise in the best interests of the
Company and its stockholders, then proper provision shall be made so that each
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holder of a Right, except as provided below, shall thereafter have a right to
receive, upon exercise thereof at a price equal to the then current Purchase
Price multiplied by the number of one one-hundredths of a share of Preferred
Stock for which a Right is then exercisable, in accordance with the terms of
this Agreement, such number of shares of Common Stock of the Company as shall
equal the result obtained by (x) multiplying the then current Purchase Price by
the then number of one one-hundredths of a share of Preferred Stock for which a
Right is then exercisable and dividing that product by (y) 50% of the current
market price per share of Common Stock of the Company (determined pursuant to
Section 11(d)) on the date of such occurrence (such number of shares issuable
upon exercise of all outstanding Rights being herein referred to as the
"Adjustment Shares"); provided, however, that if the transaction that would
otherwise give rise to the foregoing adjustment is also subject to the
provisions of Section 13 hereof, then only the provisions of Section 13 hereof
shall apply and no adjustment shall be made pursuant to this Section 11(a)(ii);
provided further that, if the Common Stock of the Company have been reclassified
or recapitalized in a transaction described in Section 11(a)(i) or converted or
otherwise changed in any manner from the capital stock of the Company that were
shares of Common Stock of the Company on the date of this Agreement (such Common
Stock prior to any such reclassification, recapitalization, conversion or other
change being referred to as the "Original Shares"), then each holder of a Right
thereafter shall have a right to receive, upon exercise thereof at the then
current Purchase Price in accordance with the terms of this Agreement, at the
election of the holder, either the number of shares of Common Stock of the
Company determined pursuant to clauses (x) and (y) above or such number of
shares of capital stock, other securities and/or property into which the
Original Shares were reclassified, recapitalized, converted or changed, adjusted
to reflect changes in the market price of such capital stock or other securities
and in the fair market value of such property since the date of such
reclassification, recapitalization, conversion or other change, as determined by
a nationally recognized investment banking firm selected by the Board of
Directors of the Company, so that the holder of any Right exercised thereafter
shall be entitled to receive the aggregate number and kind of capital stock,
other securities and/or property (adjusted for changes in market price and fair
market value) which, if such Section 11(a)(ii) Event (and the related adjustment
of the number of Common Stock to be received upon exercise of a Right) had
occurred prior to the date of such reclassification, recapitalization,
conversion or other change and such Right as so adjusted had been exercised
immediately prior to such date and at a time when the transfer books of the
Company were open, such holder would have owned upon such exercise and been
entitled to receive by virtue of such reclassification, recapitalization,
conversion or change.
(iii) In the event that there shall not be sufficient authorized but
unissued shares of Common Stock and authorized and issued shares of Common Stock
held in the treasury and not reserved for other purposes to permit the exercise
in full of the Rights in accordance with the foregoing subparagraph (ii), the
Company shall take all such action as may be necessary to authorize additional
shares of Common Stock for issuance upon exercise of the Rights; provided,
however, that if the Company is unable to, or for any reason does not promptly,
cause the authorization of a sufficient number of additional shares of Common
Stock, then, in the event the Rights become exercisable as provided in Section
7(a), the Company, with respect to each Right and to the extent necessary under
and permitted by applicable law and any agreements or instruments in effect on
the
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Stock Acquisition Date to which it is a party, shall make adequate provision
to substitute for that number of the Adjustment Shares as to which additional
shares of Common Stock have not been authorized for issuance: (A) an amount in
cash equal to the excess of (1) the product of (x) the number of Adjustment
Shares, multiplied by (y) the current market price (determined pursuant to
Section 11(d)) per share of Common Stock on the date on which the Section
11(a)(ii) Event occurs (such product being hereinafter referred to as the
Current Value), over (2) the Purchase Price, in lieu of issuing shares of Common
Stock and requiring payment therefor, (B) debt or equity securities (other than
shares of Common Stock) having a value equal to the Current Value, where the
value of such securities shall be determined by a nationally recognized
investment banking firm selected by the Board of Directors of the Company, and
requiring the payment of the Purchase Price, (C) a number of shares of Preferred
Stock equal to the number of Adjustment Shares where a nationally recognized
investment banking firm selected by the Board of Directors of the Company shall
have determined such shares to have the same value as the shares of Common Stock
(a common stock equivalent), and requiring the payment of the Purchase Price, or
(D) any combination of cash, property, common stock equivalents and/or other
securities having the requisite value pursuant to Section 11 as determined by a
nationally recognized investment banking firm selected by the Board of Directors
of the Company and requiring the payment of all or any requisite portion of the
Purchase Price; provided further, however, that if the Company shall not have
made adequate provision to deliver value pursuant to clauses (A), (B), (C) or
(D) of the first proviso to the first sentence of this Section 11(a)(iii) within
60 days following the date of the occurrence of the Section 11(a)(ii) Event,
then the Company shall be obligated to deliver cash in accordance with clause
(A) above. To the extent that the Company determines that some action need be
taken pursuant to clauses (A), (B), (C) or (D) of the first proviso to the first
sentence of this Section 11(a)(iii), the Company may suspend the exercisability
of the Rights for a period of up to 60 days following the date of the occurrence
of the Section 11(a)(ii) Event, in order to decide the appropriate form of
distribution to be made pursuant to such first proviso and to determine the
value thereof. In the event of any such suspension, the Company shall issue a
public announcement stating that the exercisability of the Rights has been
temporarily suspended with prompt notice thereof to the Rights Agent.
(b) In case a record date is fixed by the Company or otherwise established
for the issuance of rights, options or warrants to all holders of Preferred
Stock entitling them (for a period expiring within 45 calendar days after such
record date) to subscribe for or purchase shares of Preferred Stock or shares
having the same rights, privileges and preferences as the Preferred Stock
(preferred stock equivalents) (or securities convertible into shares of
Preferred Stock or preferred stock equivalents) at a price per share of
Preferred Stock or preferred stock equivalent (or having a conversion price per
share, if a security convertible into Preferred Stock or preferred stock
equivalents) less than the current market price (as defined in Section 11(d))
per share of Preferred Stock on such record date, the Purchase Price to be in
effect after such record date shall be determined by multiplying the Purchase
Price in effect immediately prior to such record date by a fraction, of which
the numerator shall be the number of shares of Preferred Stock outstanding on
such record date plus the number of shares of Preferred Stock and/or preferred
stock equivalents which the aggregate offering price of the total number of
shares of Preferred Stock so to be offered (and/or the aggregate initial
conversion price of the convertible securities so to be offered) would purchase
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at such current market price and of which the denominator shall be the number of
shares of Preferred Stock outstanding on such record date plus the number of
additional shares of Preferred Stock and/or preferred stock equivalents 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 in a consideration part or all of which shall be in a form other than
cash, the value of such consideration shall be as determined in good faith by
the Board of Directors of the Company, whose determination shall be described in
a statement filed with the Rights Agent and which shall be conclusive for all
purposes. Preferred Stock owned by or held for the account of the Company shall
not be deemed outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date is fixed or
established; and in the event that such rights, options or warrants are not so
issued, the Purchase Price shall be adjusted to be the Purchase Price which
would then be in effect if such record date had not been fixed or established.
(c) In case a record date is fixed by the Company or otherwise established
for the making of a distribution to all holders of Preferred Stock (including
any such distribution made in connection with a consolidation or merger in which
the Company is the continuing or surviving corporation) of evidences of
indebtedness or assets (other than (i) a regular periodic cash dividend out of
earnings or retained earnings, (ii) a special cash dividend out of earnings or
retained earnings, or (iii) a dividend payable in Preferred Stock) or
subscription rights, options or warrants (excluding those referred to in Section
11(b)), 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, of which the numerator shall be the current market
price (as defined in Section 11(d)) per share of Preferred Stock on such record
date, less the fair market value (as determined in good faith by the Board of
Directors of the Company, whose determination shall be described in a statement
filed with the Rights Agent and which shall be conclusive for all purposes) of
the portion of the assets or evidences of indebtedness so to be distributed or
of such subscription rights, options or warrants applicable to one share of
Preferred Stock and of which the denominator shall be such current market price
per share of Preferred Stock. Such adjustment shall be made successively
whenever such a record date is fixed or established; and in the event that such
distribution is not so made, the Purchase Price shall again be adjusted to be
the Purchase Price which would then be in effect if such record date had not
been fixed or established.
(d) (i) For the purpose of any computation hereunder, the current market
price per share of Common Stock on any date shall be deemed to be the average of
the daily closing prices per share of Common Stock for the 30 consecutive
Trading Days (as such term is hereinafter defined) immediately prior to but not
including such date; provided, however, that in the event that the current
market price per share of Common Stock is determined during a period following
the announcement by the issuer of the Common Stock of (A) a dividend or
distribution on the Common Stock payable in Common Stock or securities
convertible into Common Stock or (B) any subdivision, combination or
reclassification of the Common Stock, and prior to the expiration of 30
consecutive Trading Days after but not including the ex-dividend date for such
dividend or distribution, or the record date for such subdivision, combination
or reclassification, as the case may be, then, and in each such case, the
current market price shall be appropriately adjusted to reflect the current
market price
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per common stock equivalent. The closing price for each day shall be the last
sale price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the shares of Common Stock are not listed or admitted to trading on the New
York Stock Exchange, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal national
securities exchange on which the shares of Common Stock are listed or admitted
to trading or, if the shares of Common Stock are not listed or admitted to
trading on any national securities exchange, the last quoted price or, if not so
quoted, the average of the high bid and low asked prices in the over-the-
counter market, as reported by the National Association of Securities Dealers,
Inc. Automated Quotation System (NASDAQ) or such other system then in use, or,
if on any such date the shares of Common Stock are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Common Stock selected by the
Board of Directors of the Company, except that, if on any such date no market
maker is making a market in the Common Stock, the fair value of such shares on
such date as determined in good faith by the Board of Directors of the Company
shall be used. The term "Trading Day" shall mean a day on which the principal
national securities exchange on which the shares of Common Stock are listed or
admitted to trading is open for the transaction of business or, if the shares of
Common Stock are not listed or admitted to trading on any national securities
exchange, a Business Day. If the shares of Common Stock are not publicly held or
not so listed or traded, "current market price" per share of Common Stock shall
mean the fair value per share as determined in good faith by the Board of
Directors of the Company, whose determination shall be described in a statement
filed with the Rights Agent and shall be conclusive for all purposes.
(ii) For the purpose of any computation hereunder, the current market
price per share of Preferred Stock on any date shall be determined in the same
manner as set forth for the Common Stock in Section 11(d)(i). If the current per
share market price of the Preferred Stock cannot be determined in such manner,
the current per share market price of the Preferred Stock shall be conclusively
deemed to be the current per share market price of the Common Stock
(appropriately adjusted to reflect any share split, share dividend or similar
transaction occurring after the date hereof), multiplied by 100. If either the
shares of Common Stock or the shares of Preferred Stock are not publicly held or
listed or traded as contemplated by Section 11(d)(i), current market price per
share of Common Stock or Preferred Stock shall mean the fair value per share as
determined in good faith by the Board of Directors of the Company, whose
determination shall be described in a statement filed with the Rights Agent and
shall be conclusive for all purposes.
(e) No adjustment in the Purchase Price shall be required unless such
adjustment would require an increase or decrease of at least 1% in such 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 as the case may
be. Notwithstanding the first sentence of this Section 11(e), any adjustment
required by this Section 11
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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 an adjustment made pursuant to Section 11(a), the
holder of any Right thereafter exercised shall become entitled to receive any
capital shares of the Company other than Preferred Stock, thereafter the number
of such other shares so receivable upon exercise of any Right shall be subject
to adjustment from time to time in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to the shares contained in this
Section 11 and the provisions of Sections 7, 9, 10 and 13 with respect to the
shares of Preferred Stock shall apply on like terms to any such other shares.
(g) All Rights originally issued by the Company subsequent to any
adjustment made to the Purchase Price hereunder shall evidence the right to
purchase, at the adjusted Purchase Price, the number of one one-hundredths of a
share of Preferred Stock purchasable from time to time hereunder upon exercise
of the Rights, all subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as provided in
Section 11(i), upon each adjustment of the Purchase Price as a result of the
calculations made in Section 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 shares (calculated to
the nearest ten-thousandth) obtained by (i) multiplying (A) the number of shares
covered by a Right immediately prior to this adjustment by (B) 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 substitution for any
adjustment in the number of one one-hundredths of a share of Preferred Stock
purchasable upon the exercise of a Right. Each of the Rights outstanding after
such adjustment of the number of Rights shall be exercisable for the number of
one one-hundredths of a share of Preferred Stock for which a Right was
exercisable immediately prior to such adjustment. Each Right held of record
prior to such adjustment of the number of Rights shall become that number of
Rights (calculated to the nearest ten-thousandth) obtained by dividing the
Purchase Price in effect immediately prior to adjustment of the Purchase Price
by the Purchase Price in effect immediately after adjustment of the Purchase
Price. The Company shall make a public announcement of its election to adjust
the number of Rights, indicating the record date for the adjustment, and, if
known at the time, the amount of the adjustment to be made, with prompt notice
thereof to the Rights Agent. Such record date may be the date on which the
Purchase Price is adjusted or any day thereafter, but, if the Right Certificates
have been issued, the record date shall be at least 10 days later than the date
of the public announcement. If Right Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section 11(i), the Company
shall, as promptly as practicable, cause to be distributed to holders of record
of Right Certificates on such record date Right Certificates evidencing, subject
to Section 14, the additional Rights to which such holders shall be entitled as
a result of such adjustment, or, at the option of the Company, shall
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cause to be distributed to such holders of record in substitution and
replacement for the Right Certificates held by such holders prior to the date of
adjustment, and upon surrender thereof, if required by the Company, new Right
Certificates evidencing all the Rights to which such holders shall be entitled
after such adjustment. Right Certificates so to be distributed shall be issued,
executed and countersigned in the manner provided for herein (and 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 Right Certificates on the record date
specified in the public announcement.
(j) Irrespective of any adjustment or change in the Purchase Price or the
number of one one-hundredths of a share of Preferred Stock issuable upon the
exercise of the Rights, the Right Certificates theretofore and thereafter issued
may continue to express the Purchase Price and the number of one one-hundredths
of a share which were expressed in the initial Right Certificates issued
hereunder.
(k) Before taking any action that would cause an adjustment reducing the
Purchase Price below one one-hundredth of the then par value per share, if any,
of the shares of Preferred Stock 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
fully paid and nonassessable shares of Preferred Stock at such adjusted Purchase
Price.
(l) In any case in which this Section 11 shall require that an adjustment
in the Purchase Price be made effective as of a record date for a specified
event, the Company may elect to defer, with prompt notice thereof to the Rights
Agent, until the occurrence of such event the issuing to the holder of any Right
exercised after such record date the shares of Preferred Stock and other capital
stock or securities of the Company, if any, issuable upon such exercise over and
above the shares of Preferred Stock and other capital stock or securities of the
Company, if any, issuable upon such exercise on the basis of the Purchase Price
in effect prior to such adjustment; provided however, that the Company shall
deliver to such holder a due bill or other appropriate instrument evidencing
such holder's right to receive such additional shares upon the occurrence of the
event requiring such adjustment.
(m) Anything in this Section 11 to the contrary notwithstanding, the
Company shall be entitled to make such reductions in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that it in its sole discretion shall determine to be advisable in
order that any consolidation or subdivision of the Preferred Stock, issuance
wholly for cash of any shares of Preferred Stock at less than the current market
price, issuance wholly for cash of shares of Preferred Stock or securities which
by their terms are convertible into or exchangeable for shares of Preferred
Stock, share dividends or issuance of rights, options or warrants referred to
hereinabove in this Section 11, hereafter made by the Company to holders of its
Preferred Stock shall not be taxable to such stockholders.
(n) Notwithstanding any other provision of this Agreement, no adjustment to
the Purchase Price, the number of one one-hundredths of a share of Preferred
Stock for which a Right
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is exercisable or the number of Rights outstanding (except as permitted by
Section 23 hereof) or any similar adjustment shall be made or be effective if
such adjustment would have the effect of reducing or limiting the benefits the
holders of the Rights would have had absent such adjustment, including, without
limitation, the benefits under Section 11(a)(ii) and Section 13, unless the
terms of this Agreement are amended so as to preserve such benefits.
(o) In the event that at any time after the date of this Agreement and
prior to the Distribution Date, the Company shall (i) declare or pay any
dividend on the Common Stock payable in Common Stock or (ii) effect a
subdivision, combination or consolidation of the Common Stock (by
reclassification or otherwise than by payment of dividends in Common Stock) into
a greater or lesser number of shares of Common Stock, then in any such case (i)
the number of one one-hundredths of a share of Preferred Stock purchasable after
such event upon proper exercise of each Right shall be determined by multiplying
the number of one one-hundredths of a share of Preferred Stock so purchasable
immediately prior to such event by a fraction, the numerator of which is the
number of shares of Common Stock outstanding immediately before such event and
the denominator of which is the number of shares of Common Stock outstanding
immediately after such event, and (ii) each share of Common Stock outstanding
immediately after such event shall have issued with respect to it that number of
Rights which each share of Common Stock outstanding immediately prior to such
event had issued with respect to it. The adjustments provided for in this
Section 11(o) shall be made successively whenever such a dividend is declared or
paid or such a subdivision, combination or consolidation is effected.
(p) The Company covenants and agrees that, following the Distribution Date,
except as permitted by Section 23 or Section 27 hereof, it will not, directly or
indirectly, take any action the purpose or effect of which is to eliminate or
otherwise diminish the benefits intended to be afforded by the Rights.
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Section 11 or 13, the Company
shall (a) promptly prepare a certificate setting forth such adjustment, and a
brief statement of the facts and computations accounting for such adjustment,
(b) promptly file with the Rights Agent and with each transfer agent for the
Common Stock or the Preferred Stock a copy of such certificate and (c) mail a
brief summary thereof to each holder of a Right Certificate in accordance with
Section 26. The Rights Agent shall be fully protected in relying on any such
certificate and on any adjustment contained therein and shall have no duty with
respect to and shall not be obligated or responsible for calculating any
adjustment nor shall it be deemed to have knowledge of such adjustment unless
and until it shall have received such certificate. Section 1.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning
Power.
(a) In the event that, on or after the Stock Acquisition Date, directly or
indirectly, (i) the Company shall consolidate with, or merge with and into, any
other Person, and the Company shall not be the continuing or surviving
corporation, (ii) any Person shall consolidate with the
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Company, or merge with and into the Company, and the Company shall be the
continuing or surviving corporation and, in connection therewith, all or part of
the Common Stock of the Company shall be changed into or exchanged for shares or
other securities of any other Person or cash or any other property, or (iii) the
Company shall sell or otherwise transfer (or one or more of its subsidiaries
shall sell or otherwise transfer), in one or more transactions, assets or
earning power aggregating 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,
then, and in each such case, proper provision shall be made so that (A) each
holder of a Right shall thereafter have the right to receive, upon the exercise
thereof at a price equal to the then-current Purchase Price multiplied by the
number of one one-hundredths of a share of Preferred Stock for which a Right is
then exercisable, in accordance with the terms of this Agreement, such number of
validly authorized and issued, fully paid, non-assessable and freely tradeable
shares of Common Stock of the Principal Party (as hereinafter defined), free and
clear of any liens, encumbrances and adverse claims and not subject to any
rights of call, purchase or first refusal, as shall be equal to the result
obtained by (x) multiplying the then current Purchase Price by the number of one
one-hundredths of a share of Preferred Stock for which a Right is then
exercisable and dividing that product by (y) 50% of the current market price
(determined pursuant to Section 11(d)) per share of Common Stock of the
Principal Party on the date or consummation of such consolidation, merger, sale
or transfer; (B) such Principal Party shall thereafter be liable for, and shall
assume, by virtue of such consolidation, merger, sale or transfer, all the
obligations and duties of the Company pursuant to this Agreement; (C) 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 an event set forth in
Section 13(a) hereof; and (D) such Principal Party shall take such steps
(including, but not limited to, the reservation of a sufficient number of its
shares of Common Stock in accordance with Section 9) in connection with such
consummation as may be necessary to assure that the provisions hereof shall
thereafter be applicable, as nearly as reasonably may be, in relation to its
shares of Common Stock or cash, property or other securities thereafter
deliverable upon the exercise of the Rights.
(b) "Principal Party" shall mean (i) in the case of any transaction
described in (i) or (ii) of the first sentence of Section 13(a), the Person that
is the issuer of any securities into which shares of Common Stock of the Company
are converted in such merger or consolidation, and if no securities are so
issued, the Person that is the other party to such merger or consolidation; and
(ii) in the case of any transaction described in (iii) of the first sentence in
Section 13(a), the Person that is the party receiving the greatest portion of
the assets or earning power transferred pursuant to such transaction or
transactions; provided, however, that in any such case, (1) if the shares of
Common Stock of such Person are not at such time and have 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 directly or indirectly controlled by another Person which has
Registered Common Stock outstanding, "Principal Party" shall refer to such other
Person; (2) if the shares of Common Stock of such Person are not Registered
Common Stock or such Person is not a corporation, and such Person is directly or
indirectly controlled by another Person which does not have Registered Common
Stock outstanding, "Principal Party" shall refer to the controlling Person of
such first-mentioned Person; (3) if the shares of Common Stock of such Person
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are 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 controlling Persons have Registered Common Stock outstanding,
"Principal Party" shall refer to whichever of such controlling Persons is the
issuer of the Registered Common Stock having the greatest aggregate market
value; and (4) if the shares of Common Stock of such Person are 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 controlling
Persons have Registered Common Stock outstanding, "Principal Party" shall refer
to whichever controlling Person is the corporation having the greatest
stockholders equity or, if no such controlling Person is a corporation, shall
refer to whichever controlling Person has the greatest net assets.
(c) The Company shall not consummate any such consolidation, merger, sale
or transfer unless prior thereto the Company and such Principal Party shall have
executed and delivered to the Rights Agent a legally valid, binding and
enforceable supplemental agreement in compliance with the provisions set forth
in Section 13(a) and (b), and if applicable Section 13(d), and further providing
that, as soon as practicable after the date of any consolidation, merger or sale
of assets mentioned in this Section 13, such issuer will (i) prepare and file a
registration statement under the Act, with respect to the Rights and the
securities purchasable upon exercise of the Rights on an appropriate form, and
will use its best efforts to cause such registration statement to (A) become
effective as soon as practicable after such filing and (B) remain effective
(with a prospectus at all times meeting the requirements of the Act) until the
Expiration Date; and (ii) will deliver to holders of the Rights historical
financial statements for such issuer and each of its Affiliates which comply in
all respects with the requirements for registration on Form 10 under the
Exchange Act.
(d) Notwithstanding anything in Section 13(b) and (c) to the contrary, if
the Principal Party as determined pursuant to paragraph (b) above is not a
corporation or does not have shares of Common Stock, proper provision shall be
made so that such Principal Party shall create or otherwise make available for
purposes of the exercise of the Rights in accordance with the terms of this
Agreement, cash or a type or types of securities having a fair market value (as
determined by a nationally recognized investment banking firm selected by the
Board of Directors of the Company) equal to at least the value of the shares of
Common Stock which each holder of a Right would have been entitled to receive if
such Principal Party had been a corporation or had shares of Common Stock.
(e) The Company covenants and agrees that, following the Distribution Date,
it shall not consummate any of the transactions described in clauses (i), (ii)
and (iii) of the first sentence of Section 13(a) if at the time of or after such
consummation there would be any charter or by-law provisions or any rights,
warrants or other instruments or securities outstanding or agreements in effect
or any other action taken which would diminish or eliminate the benefits
intended to be afforded by the Rights, unless prior thereto the Principal Party
shall have amended or repealed such charter or by-law provisions, instruments or
securities, agreements or actions or otherwise protected the holders of the
Rights from such diminution or elimination of benefits, and the Company and the
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Principal Party shall have executed and delivered to the Rights Agent a legally
valid, binding and enforceable supplemental agreement providing for such
amendment, repeal or other protection.
(f) The provisions of this Section 13 shall similarly apply to successive
mergers, consolidations, sales or other transfers. In the event that any
transaction set forth in Section 13 occurs 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 this Section 13.
(g) Notwithstanding anything in this Agreement to the contrary, Section 13
shall not be applicable to a transaction described in subparagraph (i) and (ii)
of Section 13(a) if (i) such transaction is consummated with a Person or Persons
who acquired shares of Common Stock pursuant to a tender offer or exchange offer
for all the outstanding shares of Common Stock of the type excepted from the
provisions of Section 11(a)(ii) hereof by the terms of that Section (or a wholly
owned subsidiary of any such Person or Persons), (ii) the price per share of
Common Stock offered in such transaction is not less than the price per share of
Common Stock paid to all holders of Common Stock whose shares were purchased
pursuant to such tender offer or exchange offer, and (iii) the form of
consideration being offered to the remaining holders of Common Stock pursuant to
such transaction is the same as the form of consideration paid pursuant to such
tender offer or exchange offer. Upon consummation of any such transaction
contemplated by this Section 13(g), all Rights hereunder shall expire.
Section 14. Fractional Rights and Fractional Shares.
(a) The Company shall not be required to issue fractions of Rights or to
distribute Right Certificates which evidence fractional Rights. In lieu of such
fractional Rights, there shall be paid to the registered holders of the Right
Certificates with regard to which such fractional Rights would otherwise be
issuable, an amount in cash equal to the same fraction of the current market
value of a whole Right. For the purposes of this Section 14(a), the current
market value of a whole Right shall be the closing price of the Rights for the
Trading Day immediately prior to the date on which such fractional Rights would
have been otherwise issuable. The closing price for any day shall be the last
sale price, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, in either case as
reported in the principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the New York Stock Exchange or,
if the Rights are not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting system
with respect to securities listed on the principal national securities exchange
on which the Rights are listed or admitted to trading or, if the Rights are not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by NASDAQ or such other
system then in use or, if on any such date the Rights are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the Rights selected by the Board of
Directors of the Company, except that, if on any such date no such market maker
is making a market in the Rights, the fair value of the Rights on such date as
determined in good faith by the Board of Directors of the Company shall be used.
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(b) The Company shall not be required to issue fractions of shares of
Preferred Stock upon exercise of the Rights or to distribute certificates which
evidence fractional shares of Preferred Stock, other than fractions of Preferred
Stock that are integral multiples of one one-hundredth of a share of Preferred
Stock and certificates evidencing such fractional shares. Fractions of shares of
Preferred Stock in integral multiples of one one-hundredth of a share of
Preferred Stock may, at the election of the Company, be evidenced by depositary
receipts, pursuant to an appropriate agreement between the Company and a
depositary agent selected by it, provided that such agreement shall provide that
the holders of such depositary receipts shall have all the rights, privileges
and preferences to which they are entitled as beneficial owners of the Preferred
Stock represented by such depositary receipts. In lieu of fractional shares of
Preferred Stock (other than fractional Preferred Stock that are integral
multiples of one one-hundredth of a share), the Company may pay to the
registered holders of Right Certificates at the time such Right Certificates are
exercised as herein provided an amount in cash equal to the same fraction of the
current market value of a share of Preferred Stock. For purposes of this Section
14(b), the current market value of a share of Preferred Stock shall be the
closing price of a share of Preferred Stock (as determined pursuant to Section
11(d)(ii)) for the Trading Day immediately prior to the date of such exercise.
(c) Following the occurrence of a Section 11(a)(ii) Event or a Section
13(a) Event, the Company or the Principal Party, as the case may be, shall not
be required to issue fractions of shares of Common Stock upon exercise of the
Rights or to distribute certificates which evidence fractional shares. In lieu
of fractional shares, the Company or the Principal Party, as the case may be,
may pay to the registered holders of Right Certificates at the time such Right
Certificates are exercised as herein provided an amount in cash equal to the
same fraction of the current market value of a share of Common Stock. For
purposes of this Section 14(c), the current market value of a share of Common
Stock shall be the closing price of a share of Common Stock (as determined
pursuant to Section 11(d)(i)) for the Trading Day immediately prior to the date
of such exercise.
(d) Each holder of a Right or Rights by the acceptance of the Rights
expressly waives his right to receive any fractional Rights or any fractional
shares upon exercise of a Right or Rights except as provided in Section 14(b)
and (c).
Section 15. Rights of Action. All rights of action in respect of this
Agreement, excepting the rights of action given to the Rights Agent under this
Agreement, are vested in the respective registered holders of the Right
Certificates (and, prior to the Distribution Date, the registered holders of the
Common Stock); and any registered holder of any Right Certificate (or, prior to
the Distribution Date, of the Common Stock), without the consent of the Rights
Agent or of the holder of any other Right Certificate (or, prior to the
Distribution Date, of the Common Stock), may, in his own behalf and for his own
benefit, enforce, and may institute and maintain any suit, action or proceeding
against the Company to enforce, or otherwise act in respect of, his right to
exercise the Rights evidenced by such Right Certificate in the manner provided
in such Right Certificate and in
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this Agreement. Without limiting the foregoing or any remedies available to
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
will be entitled to specific performance of the obligations under, and
injunctive relief against actual or threatened violations of, the obligations of
any Person subject to this Agreement.
Section 16. Agreement of Right Holders. Every holder of a Right by
accepting the same consents and agrees with the Company and the Rights Agent and
with every other holder of a Right that:
(a) prior to the Close of Business on the Distribution Date, the Rights
will be transferable only in connection with the transfer of Common Stock;
(b) after the Close of Business on the Distribution Date, the Rights will
be transferable only by transfer of the Right Certificates, which are
transferable only on the registry books of the Rights Agent if surrendered at
the principal office of the Rights Agent, duly endorsed or accompanied by a
proper instrument of transfer;
(c) the Company and the Rights Agent may deem and treat the person in whose
name each Right Certificate (or, prior to the Distribution Date, the associated
Common Stock certificate) is registered as the absolute owner thereof and of the
Rights evidenced thereby (notwithstanding any notations of ownership or writing
on the Right Certificate or the associated Common Stock certificate made by
anyone other than the Company or the Rights Agent) for all purposes whatsoever,
and neither the Company nor the Rights Agent 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 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 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 the obligation.
Section 17. Right Certificate Holder Not Deemed a Stockholder. No holder,
as such, of any Right Certificate shall be entitled to vote, receive dividends
or be deemed for any purpose the holder of 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
Right Certificate be construed to confer upon the holder of any Right
Certificate, as such, any of the rights of a stockholder of the Company or any
right to vote for the election of directors or upon any matter submitted to
stockholders at any meeting thereof, or to give or withhold consent to any
corporate action, or to receive notice of meetings or other actions affecting
stockholders (except as provided in Section 25), or to receive dividends or
subscription rights, or otherwise, until the Right
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or Rights evidenced by such Right Certificate shall have been exercised in
accordance with the provisions hereof.
Section 18. Concerning the Rights Agent.
(a) The Company agrees to pay to the Rights Agent reasonable compensation
for all services rendered by it hereunder and, from time to time, on demand of
the Rights Agent, its reasonable expenses and counsel fees and other
disbursements incurred in the administration and execution of this Agreement and
the exercise and performance of its duties hereunder. The Company also agrees to
indemnify the Rights Agent for, and to hold it harmless against, any loss,
liability, damage, judgment, fine, penalty, claim, demand, settlement, cost or
expense, incurred without gross negligence, bad faith or willful misconduct as
finally determined by a court of competent jurisdiction on the part of the
Rights Agent, for any action taken, suffered or omitted by the Rights Agent in
connection with the acceptance and administration of this Agreement, including
without limitation the costs and expenses of defending against any claim of
liability arising therefrom, directly or indirectly. The costs and expenses of
enforcing this right of indemnification shall also be paid by the Company. The
indemnification provided for hereunder shall survive the expiration of the
Rights and termination of this Agreement.
(b) The Rights Agent may conclusively rely upon and shall be protected and
shall incur no liability for or in respect of any action taken, suffered or
omitted by it in connection with its administration of this Agreement in
reliance upon any Right Certificate or certificate for Preferred Stock or for
other securities of the Company, instrument of assignment or transfer, power of
attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement or other, paper or document believed by it to be genuine
and to be signed, executed and, where necessary, verified or acknowledged, by
the proper person or persons or otherwise upon the advice or opinion of counsel
as set forth in Section 20 hereof.
(c) Notwithstanding anything in this Agreement to the contrary, in no event
shall the Rights Agent be liable for special, punitive, indirect or
consequential loss or damage of any kind whatsoever (including but not limited
to lost profits), even if the Rights Agent has been advised of the likelihood of
such loss or damage and regardless of the form of the action.
Section 19. Merger or Consolidation or Change of Name of Rights Agent.
(a) Any Person into which the Rights Agent or any successor Rights Agent
may be merged or with which it may be consolidated, or any Person resulting from
any merger or consolidation to which the Rights Agent or any successor, Rights
Agent shall be a party, or any Person succeeding to the shareholder services
business of the Rights Agent or any successor Rights Agent, shall be the
successor to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto;
provided, however, that such Person would be eligible for appointment as a
successor Rights Agent under the provisions of Section 21. In case at the time
such successor Rights Agent shall succeed to the agency created by
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this Agreement, any of the Right Certificates shall have been countersigned but
not delivered, any such successor Rights Agent may adopt the countersignature of
the predecessor Rights Agent and deliver such Right Certificates so
countersigned; and in case at that time any of the Right Certificates shall not
have been countersigned, any successor Rights Agent may countersign such Right
Certificates either in the name of the predecessor Rights Agent or in the name
of the successor Rights Agent; and in all such cases such Right Certificates
shall have the full force provided in the Right Certificates and in this
Agreement.
(b) In case at any time the name of the Rights Agent shall be changed and
at such time any of the Right Certificates shall have been countersigned but not
delivered, the Rights Agent may adopt the countersignature under its prior name
and deliver Right Certificates so countersigned; and in case at that time any of
the Right Certificates shall not have been countersigned, the Rights Agent may
countersign such Right Certificates either in its prior name or in its changed
name; and in all such cases such Right Certificates shall have the full force
provided in the Right Certificates and in this Agreement.
Section 20. Terms and Conditions to Duties of Rights Agent. The Rights
Agent undertakes only the duties and obligations expressly imposed by this
Agreement upon the following terms and conditions, and no implied duties or
obligations shall be read into this agreement against the Rights Agent, by all
of which the Company and the holders of Right Certificates, by their acceptance
thereof, shall be bound:
(a) Before the Rights Agent acts, or refrains from acting, the Rights Agent
may consult with legal counsel (who may be legal counsel for the Company), and
the advice and opinion of such counsel shall be full authorization and
protection to the Rights Agent for any action taken, suffered or omitted by it
in good faith and in accordance with such advice or 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 per share market price) be proved or established by the
Company prior to taking, suffering or omitting any action hereunder, such fact
or matter (unless other evidence in respect thereof be herein specifically
prescribed) may be deemed to be conclusively proved and established by a
certificate signed by the Chairman, the President or any Vice President and by
the Treasurer or any Assistant Treasurer or the Secretary or any Assistant
Secretary of the Company and delivered to the Rights Agent; and such certificate
shall be full authorization and protection to the Rights Agent and the Rights
Agent shall incur no liability for or in respect of any action taken, suffered
or omitted by it in good faith under the provisions of this Agreement in
reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its own gross
negligence, bad faith or willful misconduct as finally determined by a court of
competent jurisdiction.
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(d) The Rights Agent shall not be liable for or by reason of any of the
statements of fact or recitals contained in this Agreement or in the Right
Certificates (except its countersignature thereof) or be required to verify the
same, but all such statements and recitals are and shall be deemed to have been
made by the Company only.
(e) The Rights Agent shall not be under any liability or responsibility in
respect of the validity of this Agreement or the execution and delivery hereof
(except the due execution hereof by the Rights Agent) or in respect of the
validity or execution of any Right Certificate (except its countersignature
thereof); nor shall it be liable or responsible for any breach by the Company of
any covenant or condition contained in this Agreement or in any Right
Certificate; nor shall it be liable or responsible for any adjustment required
under the provisions of Sections 11 or 13 or responsible for the manner, method
or amount of any such adjustment or the ascertaining of the existence of facts
that would require any such adjustment (except with respect to the exercise of
Rights evidenced by Right Certificates after actual notice of any such
adjustment); nor shall it by any act hereunder be deemed to make any
representation or warranty as to the authorization or reservation of any shares
of Preferred Stock to be issued pursuant to this Agreement or any Right
Certificate or as to whether any shares of Preferred Stock will, when issued, be
validly authorized and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may reasonably be required
by the Rights Agent for the carrying out or performing by the Rights Agent of
the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
determinations, interpretations and instructions with respect to the performance
of its duties hereunder from the Chairman, the President or any Vice President
or the Secretary or any Assistant Secretary or 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, suffered or omitted to be taken by it in good faith in accordance
with determinations, interpretations and instructions of any such officer or any
delay in acting while waiting for these instructions. Any application by the
Rights Agent for written instructions from the Company may, at the option of the
Rights Agent, set forth in writing any action proposed to be taken, suffered or
omitted by the Rights Agent under this Agreement and the date on or after which
such action shall be taken, suffered or such omission shall be effective. The
Rights Agent shall not be liable for any action taken or suffered 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 ten Business Days after the date any officer of the Company
actually receives such application, unless any such officer shall have consented
in writing to an earlier date) unless, prior to taking any such action (or the
effective date in the case of an omission), the Rights Agent shall have received
written instructions in response to such application specifying the action to be
taken suffered or omitted.
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(h) The Rights Agent and any stockholder, director, officer, affiliate 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 Person.
(i) The Rights Agent may execute and exercise any of the rights or powers
hereby vested in it or perform any duty hereunder either itself or by or through
its attorneys or agents, and the Rights Agent shall not be answerable or
accountable for any act, default, negligence or misconduct of any such attorney
or agent or for any loss to the Company resulting from any such act, default,
negligence or misconduct, absent gross negligence, bad faith or wilful
misconduct, as finally determined by a court of competent jurisdiction, in the
selection and continued employment thereof.
(j) If, with respect to any Right Certificate surrendered to the Rights
Agent for exercise or transfer, the certificate attached to the form of
assignment or form of election to purchase, as the case may be, has not been
completed to identify if the holder is an Acquiring Person or an affiliate or
associate thereof, the Rights Agent, subject to the provisions of Section
11(a)(ii), shall not take any further action with respect to such requested
exercise or transfer without first consulting with the Company.
(k) No provision of this Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if
there shall be reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not reasonably
assured to it.
(l) The Rights Agent shall not be required to take notice or be deemed to
have any notice of any fact, event or determination (including, without
limitation, any dates or events defined in this Agreement or the designation of
any Person as an Acquiring Person, Affiliate or Associate) under this Agreement
unless and until the Rights Agent shall be specifically notified in writing by
the Company of such fact, event or determination.
Section 21. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Agreement
upon 30 days' notice in writing mailed to the Company and to each transfer agent
of the Common Stock by registered or certified mail, and, at the expense of the
Company, to the holders of the Right Certificates by first-class mail (at the
expense of the Company). The Company may remove the Rights Agent or any
successor Rights Agent upon 30 days' notice in writing, mailed to the Rights
Agent or successor Rights Agent, as the case may be, and to each transfer agent
of the Common Stock by registered or certified mail, and to the holders of the
Right Certificates by first-class mail. If the Rights Agent shall resign or be
removed or shall otherwise become incapable of acting or shall repeatedly fail
or refuse to act, the Company shall appoint a successor to the Rights Agent. If
the Company shall fail to make
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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 or
repeated failure or refusal to act by the Rights Agent or by the holder of a
Right Certificate (who shall, without notice, submit his Right Certificate for
inspection by the Company), then the registered holder of any Right Certificate
or the Rights Agent 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 Person organized and doing
business under the laws of the United States or of any state of the United
States so long as such Person is authorized to do business, is in good standing,
is authorized under such laws and is subject to supervision or examination by
federal or state authority and which has at the time of its appointment as
Rights Agent a combined capital and surplus of at least $100,000,000 or (b) an
Affiliate of any Person described in the foregoing 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, and the predecessor Rights Agent shall
deliver and transfer to the successor Rights Agent any property at the time held
by it hereunder, and execute and deliver any further assurance, conveyance, act
or deed necessary for the purpose. Not later than the effective date of any such
appointment, the Company shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Common Stock, and mail a
notice thereof in writing to the registered holders of the Right Certificates.
Failure to give any notice provided for in this Section 21, however, or any
defect therein, shall not affect the legality or validity of the resignation or
removal of the Rights Agent or the appointment of the successor Rights Agent, as
the case may be.
Section 22. Issuance of New Right Certificates. Notwithstanding any of the
provisions of this Agreement or of the Rights to the contrary, the Company may,
at its option, issue new Right Certificates evidencing Rights in such form as
may be approved by its Board of Directors to reflect any adjustment or change in
the Purchase Price per share and the number or kind or class of shares or other
securities or property purchasable under the Right Certificates made in
accordance with the provisions of this Agreement. In addition, in connection
with the issuance or sale of shares of Common Stock following the Distribution
Date and prior to the Expiration Date pursuant to the exercise, conversion or
exchange of share options, warrants, rights or convertible securities of the
Company that are outstanding prior to the Distribution Date, the Company shall
issue Rights with respect to all such shares of Common Stock so issued or sold
(and shall issue Right Certificates representing such Rights); provided,
however, that (i) no such Right Certificates 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 Right Certificates 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.
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Section 23. Redemption.
(a) The Board of Directors of the Company may, at its option, at any
time prior to the earlier of (i) the Close of Business on the tenth business day
after the Stock Acquisition Date (which date may be extended pursuant to Section
27 hereof) or (ii) the Final Expiration Date, redeem all but not less than all
the then outstanding Rights at a redemption price of $.01 per Right, as such
amount may be appropriately adjusted to reflect any share split, share dividend
or similar transaction occurring after the date hereof (such redemption price
being hereinafter referred to as the "Redemption Price"). Notwithstanding
anything contained in this Agreement to the contrary, the Rights shall not be
exercisable after the first occurrence of a Section 11(a)(ii) Event until such
time as the Company's right of redemption hereunder has expired.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights, and without any further action
and without any notice, the Rights will terminate and the only rights thereafter
of the holders of Rights shall be to receive the Redemption Price. Within ten
business days after the action of the Board of Directors ordering the redemption
of the Rights, the Company shall give notice of such redemption to the Rights
Agent and the holders of the then outstanding Rights by mailing such notice to
all such holders at their last addresses as they appear upon the registry books
of the Rights Agent or, prior to the Distribution Date, on the registry books of
the transfer agent for the Common Stock. Any notice which is mailed in the
manner herein provided shall be deemed given, whether or not the holder receives
the notice. Such notice of redemption shall 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 repurchase of Common Stock prior to
the Distribution Date.
Section 24. Exchange.
(a) The Board of Directors of the Company may, at its option, at any time
after the occurrence of a Section 11(a)(ii) Event or a Section 13(a) Event,
exchange all or part of the then outstanding and exercisable Rights (which shall
not include Rights that have become null and void pursuant to the provisions of
Section 7(e) hereof) for shares of Common Stock at an exchange ratio of one
share of Common Stock per Right, appropriately adjusted to reflect any share
split, share dividend or similar transaction occurring after the date hereof
(such exchange ratio being hereinafter referred to as the "Exchange Ratio").
(b) Immediately upon the action of the Board of Directors of the Company
ordering the exchange of any Rights pursuant to subsection (a) of this Section
24 and without any further action and without any notice, the right to exercise
such Rights shall terminate and the only right thereafter of the holders of such
Rights shall be to receive that number of shares of Common Stock equal to the
number of such Rights held by such holder multiplied by the Exchange Ratio. The
Company shall promptly give public notice of any such exchange with prompt
notice thereof to the
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Rights Agent; provided, however, that the failure to give, or any defect in,
such notice shall not affect the validity of such exchange. The Company promptly
shall mail a notice of any such exchange to all of the holders of such Rights at
their last addresses as they appear upon the registry books of the Rights Agent.
Any notice which is mailed in the manner herein provided shall be deemed given,
whether or not the holder receives the notice. Each such notice of exchange will
state the method by which the exchange of the Common Stock for Rights will be
effected and, in the event of any partial exchange, the number of Rights which
will be exchanged. Any partial exchange shall be effected pro rata based on the
number of Rights (other than Rights which have become null and void pursuant to
the provisions of Section 7(e) hereof) held by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the Company, at its
option, may substitute shares of Preferred Stock (or preferred stock
equivalents, as such term is defined in Section 11(b) hereof) for shares of
Common Stock exchangeable for Rights, at the initial rate of one one-hundredth
of a share of Preferred Stock (or preferred stock equivalent) for each share of
Common Stock, as appropriately adjusted to reflect adjustments in the voting
rights of the Preferred Stock so that the fraction of a share of Preferred Stock
delivered in lieu of each share of Common Stock shall have the same voting
rights as one share of Common Stock.
(d) In the event that there shall not be sufficient shares of Common Stock
or Preferred Stock issued but not outstanding or authorized but unissued to
permit any exchange of Rights as contemplated in accordance with this Section
24, the Company shall take all such action as may be necessary to authorize
additional shares of Common Stock or Preferred Stock for issuance upon exchange
of the Rights.
(e) The Company shall not be required to issue fractional shares of Common
Stock or to distribute certificates which evidence fractional shares of Common
Stock. In lieu of such fractional shares, the Company shall pay to the
registered holders of the Right Certificates with regard to which such
fractional shares would otherwise be issuable an amount in cash equal to the
same fraction of the current market value of a whole share of Common Stock. For
the purposes of this subsection (e), the current market value of a whole shares
f Common Stock shall be the closing price of a share of Common Stock (as
determined pursuant to the second sentence of Section 11(d)(i) hereof) for the
Trading Day immediately prior to the date of exchange pursuant to this Section
24.
Section 25. Notice of Certain Events. In case the Company shall propose (a)
to pay any dividend payable in shares of any class to the holders of its
Preferred Stock or to make any other distribution to the holders of its
Preferred Stock (other than a regular periodic cash dividend out of earnings or
retained earning or other than a special cash dividend out of earnings or
retained earnings), or (b) to offer to the holders of its Preferred Stock rights
or warrants to subscribe for or to purchase any additional shares of Preferred
Stock or shares of any class or any other securities, rights or options, or (c)
to effect any reclassification of its Preferred Stock (other than a
reclassification involving only the subdivision of outstanding shares of
Preferred Stock), or (d) to effect any consolidation or merger into or with, or
to effect any sale or other transfer (or to permit one or more of its
subsidiaries to effect any sale or other transfer), in one or more transactions,
of
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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, or (e) 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 Right and the Rights Agent, in
accordance with Section 26, a notice of such proposed action, which shall
specify the record date for the purposes of such shares dividend, distribution
of rights, 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 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 (a) or (b) above at least twenty days prior to the record date
for determining holders of the Preferred Stock for purposes of such action, and
in the case of any such other action, at least twenty days prior to the date of
the taking of such proposed action at the date of participation therein by the
holders of Preferred Stock, whichever shall be the earlier.
In case of the occurrence of a Section 11(a)(ii) Event Or a Section 13(a)
Event, then the Company or the Principal Party, as the case may be, shall as
soon as practicable thereafter give to each holder of a Right and the Rights
Agent, in accordance with Section 26, 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) or Section 13(a) hereof, as the case may be.
Section 26. Notices. Notices or demands authorized by this Agreement to be
given or made by the Rights Agent or by the holder of any Right Certificate to
or on the Company shall be sufficiently given or made if sent by first-class
mail, postage prepaid, addressed (until another address is filed in writing with
the Rights Agent) as follows:
NiSource Inc.
801 E. 86th Avenue
Merrillville, Indiana 46410
Attention: Chairman
with copy to the Secretary at the same address. Subject to the provisions of
Section 21, any notice or demand authorized by this Agreement to be given or
made by the Company or by the holder of any Right Certificate to or on the
Rights Agent shall be sufficiently given or made if sent by first- class mail,
postage prepaid, addressed (until another address is filed in writing with the
Company) as follows:
ChaseMellon Shareholder Services, L.L.C.
150 North Wacker Drive
Chicago, Illinois 60606
Attention: Kenneth Franke
Notices or demands authorized by this Agreement to be given or made by the
Company or the Rights Agent to the holder of any Right Certificate shall be
sufficiently given or made if sent by first-class
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mail, postage prepaid, addressed to such holder at the address of such holder as
shown on the registry books of the Company.
Section 27. Supplements and Amendments. Prior to the Distribution Date and
subject to the penultimate sentence of this Section 27, 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 Common Stock and Rights. From and after the Distribution Date and
subject to the penultimate sentence of this Section 27, the Company and the
Rights Agent shall, if the Company so directs, supplement or amend this
Agreement without the approval of any holders of Right Certificates in order (i)
to cure any ambiguity, (ii) to correct or supplement any provision contained
herein which may be defective or inconsistent with any other provisions herein,
(iii) to shorten or lengthen any time period hereunder, or (iv) to change or
supplement the provisions hereunder in any manner which the Company may deem
necessary or desirable and which shall not adversely affect the interests of the
holders of Right Certificates (other than an Acquiring Person or an Affiliate or
Associate of an Acquiring Person); provided, however, that this Agreement may
not be supplemented or amended to lengthen, pursuant to clause (iii) of this
sentence, a time period relating to when the Rights may be redeemed at any time
when the Rights are not redeemable. Upon the delivery of a certificate from an
appropriate officer of the Company which states that the proposed supplement or
amendment is in compliance with the terms of this Section 27, and such
supplement or amendment does not change or increase the Rights Agent's duties,
liabilities or obligations, 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 or
the number of one one-hundredths of a share of Preferred Stock for which a Right
is exercisable. Prior to the Distribution Date, the interests of the holders of
Rights shall be deemed coincident with the interests of the holders of Common
Stock.
Section 28. Successors. All the covenants and provisions of this Agreement
by or for the benefit of the Company or the Rights Agent shall bind and inure to
the benefit of their respective successors and assigns hereunder.
Section 29. Benefits of this Agreement. Nothing in this Agreement shall be
construed to give to any person or corporation other than the Company, the
Rights Agent and the registered holders of the Right Certificates (and, prior to
the Distribution Date, the shares of Common Stock) any legal or equitable right,
remedy or claim under this Agreement; but this Agreement shall be for the sole
and exclusive benefit of the Company, the Rights Agent and the registered
holders of the Right Certificates (and, prior to the Distribution Date, the
shares of Common Stock).
Section 30. Governing Law. This Agreement and each Right Certificate issued
hereunder shall be deemed to be a contract made under the laws of the State of
Delaware and for all purposes shall be governed by and construed in accordance
with the laws of such state applicable to contracts to be made and performed
entirely within such state; provided, however, that all provisions regarding the
rights, duties and obligations of the Rights Agent shall be governed by and
construed
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in accordance with the laws of the State of New York applicable to contracts
made and to be performed entirely within such state.
Section 31. Counterparts. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
Section 32. Descriptive Headings. Descriptive headings of the several
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
Section 33. Severability. If any term, provision, covenant or restriction
of this Agreement shall be held by a court of competent jurisdiction or other
authority to be invalid, void, illegal or unenforceable, the validity or
enforceability of the remainder of the terms, provisions, covenants and
restrictions shall not be affected thereby, 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, illegal or unenforceable and the Board of Directors of the
Company determines in its good faith judgment that severing the invalid language
from this Agreement would adversely affect the purpose or effect of this
Agreement, the right of redemption set forth in Section 23 hereof shall be
reinstated, if theretofore expired, or extended so as not to expire until the
Close of Business on the fifteenth business day following the date of such
determination by the Board of Directors.
Section 34. Determinations and Actions by the Board of Directors. etc. For
all purposes of this Agreement, any calculation of the number of shares of
Common Stock outstanding at any particular time, including for purposes of
determining the particular percentage of such outstanding shares of Common Stock
of which any Person is the Beneficial Owner, shall be made in accordance with
the last sentence of Rule 13d-3(d)(1)(i) of the General Rules and Regulations
under the Exchange Act. The Board of Directors of the Company 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 to (i) interpret the provisions of this
Agreement, and (ii) make determinations deemed necessary or advisable for the
administration of this Agreement (including a determination to redeem or not
redeem the Rights or to amend the Agreement). All such actions, calculations,
interpretations and determinations (including, for purposes of clause (y) below,
all omissions with respect to the foregoing) which are done or made by the
Board, shall (x) be final, conclusive and binding on the Company, the Rights
Agent, the holders of the Rights and all other parties, and (y) not subject the
Board to any liability to the holders of the Rights.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
Attest: NEW NISOURCE INC.
By: By:
--------------------------------- ------------------------
------------------------
------------------------
Attest: CHASEMELLON SHAREHOLDER
SERVICES, L.L.C.,
By: By:
--------------------------------- ------------------------
------------------------
------------------------
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Exhibit A
[Form of Right Certificate]
Certificate No. R- ______ Rights
NOT EXERCISABLE AFTER MARCH 12, 2010 OR EARLIER IF CONSUMMATION OF A
TRANSACTION PURSUANT TO SECTION 13(g) OF THE RIGHTS AGREEMENT OCCURS OR IF
NOTICE OF REDEMPTION OR EXCHANGE IS GIVEN. THE RIGHTS ARE SUBJECT TO
REDEMPTION AT $.01 PER RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE
RIGHTS AGREEMENT. [THE RIGHTS REPRESENTED BY THIS CERTIFICATE ARE OR WERE
BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN
ASSOCIATE OR AFFILIATE OF AN ACQUIRING PERSON. THIS RIGHT CERTIFICATE AND
THE RIGHTS REPRESENTED HEREBY MAY BECOME VOID IN THE CIRCUMSTANCES
SPECIFIED IN SECTION 7(e) OF THE RIGHTS AGREEMENT.]*
Right Certificate
NEW NISOURCE INC.
This certifies that _______________, or registered assigns, is the
registered owner of the number of Rights set forth above, each of which entitles
the owner thereof, subject to the terms, provisions and conditions of the Rights
Agreement dated as of________ __, 2000 (the "Rights Agreement") between New
NiSource Inc., a Delaware corporation (the "Company"), and ChaseMellon
Shareholder Services, L.L.C., a New Jersey limited liability company (the
"Rights Agent"), to purchase from the Company at any time after the Distribution
Date (as such term is defined in the Rights Agreement) when the rights are
exercisable pursuant to the Rights Agreement and prior to 5:00 P.M. (New Jersey
time) on ________ __, 2010 at the principal office of the Rights Agent, or its
successors as Rights Agent, one one-hundredth of a fully paid non-assessable
share of the Series A Junior Participating Preferred Stock, without par value
("Preferred Stock"), of the Company, at a purchase price of $60 per one
one-hundredth of a share (the "Purchase Price"), upon presentation and surrender
of this Right Certificate with the Form of Election to Purchase duly executed.
The number of Rights evidenced by this Right Certificate (and the number of one
one-hundredths of a share which may be purchased upon exercise thereof) set
forth above, and the Purchase Price set forth above, are the number and Purchase
Price as of ________ __, 2000, based on the Preferred Stock of the Company as
constituted at such date.
- -----------------
* The portion of the legend in brackets shall be inserted only if
applicable.
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40
As provided in the Rights Agreement, the Purchase Price and the number of
one one-hundredths of a share of Preferred Stock or other securities or property
which may be purchased upon the exercise of the Rights evidenced by this Right
Certificate are subject to modification and adjustment upon the happening of
certain events.
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the Rights Agreement are on file at the above-mentioned office of the Rights
Agent.
This Right Certificate, with or without other Right Certificates, upon
surrender at the office of the Rights Agent, may be exchanged for another Right
Certificate or Right Certificates of like tenor and date evidencing Rights
entitling the holder to purchase a like aggregate number of one one-hundredths
of a share of Preferred Stock or other securities or property as the Rights
evidenced by the Right Certificate or Right Certificates surrendered shall have
entitled such holder to purchase. If this Right Certificate shall be exercised
in part, the holder shall be entitled to receive upon surrender hereof another
Right Certificate or Right Certificates for the number of whole Rights not
exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Certificate may be redeemed by the Company at its option at a redemption
price of $.01 per Right.
No fractional shares of Preferred Stock will be issued upon the exercise of
any Right or Rights evidenced hereby (other than fractions that are integral
multiples of one one-hundredth of a share of Preferred Stock, which may, at the
election of the Company, be evidenced by depositary receipts), but in lieu
thereof a cash payment will be made, as provided in the Rights Agreement.
No holder of this Right Certificate shall be entitled to vote or receive
dividends or be deemed for any purpose the holder of a share of Preferred Stock
or of any other securities of the Company which may at any time be issuable on
the exercise hereof, nor shall anything contained in the Rights Agreement or
herein be construed to confer upon the holder hereof, as such, any of the rights
of a stockholder of the Company or any right to vote for the election of
directors or upon any matter submitted to stockholders at any meeting thereof,
or to give or withhold consent to any corporate action, or, to receive notice of
meetings or other actions affecting stockholders (except as provided in the
Rights Agreement), or to receive dividends or subscription rights, until the
Right or Rights evidenced by this Right Certificate shall have been exercised as
provided in the Rights Agreement.
This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
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41
WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal. Dated as of __________ 20__.
ATTEST: NEW NISOURCE INC.
By
----------------------------------
Secretary Title:
Countersigned:
By
-----------------------------------
Authorized Signature
A-3
42
[Form of Reverse Side of Right Certificate)
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Right Certificate.)
FOR VALUE RECEIVED
--------------------------------------------------------
hereby sells, assigns and transfers unto
---------------------------------------
- -------------------------------------------------------------------------------
(Please print name and address of transferee)
this Right Certificate, together
with all right, title and interest therein, and does hereby irrevocably
constitute and appoint _______________ Attorney, to transfer the within Right
Certificate on the books of the within- named Company, with full power of
substitution.
Dated:_________________, 20__
----------------------------------
Signature
Signature Guaranteed:
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NOTICE
The signature to the foregoing Assignment must correspond to the name as
written upon the face of this Right Certificate in every particular, without
alteration or enlargement or any change whatsoever.
A-5
44
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise the Right Certificate.)
To New NiSource Inc.:
The undersigned hereby irrevocably elects to exercise
______________________ Rights represented by this Right Certificate to purchase
the shares of Preferred Stock or other securities or property issuable upon the
exercise of such Rights and requests that certificates for such shares be issued
in the name of:
Please insert social security
or other identifying number
- --------------------------------------------------------------------------------
(Please print name and address)
- --------------------------------------------------------------------------------
If such number of Rights shall not be all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:
Please insert social security
or other identifying number
- --------------------------------------------------------------------------------
(Please print name and address)
- --------------------------------------------------------------------------------
Dated: _______________, 20__
------------------------------------
Signature
(Signature must conform in all
respects to name of holder as
specified on the face of this Right
Certificate)
Signature Guaranteed:
A-6