SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 2, 2003
HEICO CORPORATION
(Exact name of registrant as specified in its charter)
Florida
(State or other jurisdiction of incorporation)
1-4604 65-0341002
(Commission File Number) (IRS Employer Identification No.)
3000 Taft Street, Hollywood, Florida 33021
(Address of principal executive offices) (Zip Code)
(954) 987-4000
(Registrant's telephone number, including area code)
ITEM 5. OTHER EVENTS AND REGULATION FD DISCLOSURE
Effective as of November 2, 2003, the Board of Directors of HEICO Corporation
(the "Company") declared: (i) a dividend of one preferred share purchase right
(a "Common Stock Right") for each outstanding share of common stock, par value
$0.01 per share (the "Common Shares") outstanding on November 2, 2003 (the
"Common Stock Record Date") and (ii) a dividend of one preferred share purchase
right (a "Class A Common Stock Right") for each outstanding share of Class A
common stock, par value $0.01 per share (the "Class A Common Shares")
outstanding on November 2, 2003 (the "Record Date"). The description and terms
of the Common Stock Rights and Class A Common Stock Rights are set forth in a
Rights Agreement (the "Rights Agreement") between the Company and SunTrust Bank,
as Rights Agent (the "Rights Agent") and summarized below.
I. SUMMARY OF COMMON STOCK RIGHTS TO PURCHASE SERIES B PREFERRED SHARES
Each Common Stock Right entitles the registered holder to purchase from the
Company one one-hundredth of a share of Series B Junior Participating Preferred
Stock, par value $0.01 per share (the "Series B Preferred Shares"), of the
Company, at a price of $45.00 per one one-hundredth of a Preferred Share (the
"Series B Purchase Price"), subject to adjustment.
Until the earlier to occur of (i) 10 days following a public announcement that a
person or group of affiliated or associated persons (an "Acquiring Person") has
acquired beneficial ownership of 15% or more of the outstanding Common Shares or
(ii) 10 business days (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)
following the commencement of, or announcement of an intention to make, a tender
offer or exchange offer the consummation of which would result in the beneficial
ownership by a person or group of 15% or more of such outstanding Common Shares
(the earlier of such dates being called the "Distribution Date"), the Common
Stock Rights will be evidenced, with respect to any of the Common Share
certificates outstanding as of the Record Date, by such Common Share certificate
with a copy of a Summary of Common Stock Rights attached thereto.
The Rights Agreement provides that, until the Distribution Date, the Common
Stock Rights will be transferred with and only with the Common Shares. Until the
Distribution Date (or earlier redemption or expiration of the Common Stock
Rights), new Common Share certificates issued after the Record Date or upon
transfer or new issuance of Common Shares will contain a notation incorporating
the Rights Agreement by reference. Until the Distribution Date (or earlier
redemption or expiration of the Common Stock Rights), the surrender for transfer
of any certificates for Common Shares, even without such notation or a copy of
this Summary of Rights to Purchase Series B Preferred Stock being attached
thereto, will also constitute the transfer of the Common Stock Rights associated
with the Common Shares represented by such certificate. As soon as practicable
following the Distribution Date, separate certificates evidencing the Common
Stock Rights ("Series B Right Certificates") will be mailed to holders of record
of the Common Shares as of the Close of Business on the Distribution Date and
such separate Series B Right Certificates alone will evidence the Common Stock
Rights.
The Common Stock Rights are not exercisable until the Distribution Date. The
Common Stock Rights will expire on November 2, 2013 (the "Final Expiration
Date"), unless the Final Expiration Date is extended or unless the Common Stock
Rights are earlier redeemed by the Company, in each case, as described below.
The Series B Purchase Price payable, and the number of Preferred Shares or other
securities or property issuable, upon exercise of the Common Stock Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of, the
Preferred Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights or warrants to subscribe for or purchase Preferred Shares at a
price, or securities convertible into Preferred Shares with a conversion price,
less than the then current market price of the Preferred Shares or (iii) upon
the distribution to holders of the Preferred Shares of evidences of indebtedness
or assets (excluding regular periodic cash dividends paid out of earnings or
retained earnings or dividends payable in Preferred Shares) or of subscription
rights or warrants (other than those referred to above).
The number of outstanding Common Stock Rights and the number of one
one-hundredth of a Preferred Share issuable upon exercise of each Common Stock
Right are also subject to adjustment in the event of a stock split of the Common
Shares or a stock dividend on the Common Shares payable in Common Shares or
subdivisions, consolidations or combinations of the Common Shares occurring, in
any such case, prior to the Distribution Date.
Preferred Shares purchasable upon exercise of the Common Stock Rights will not
be redeemable. Each Preferred Share will be entitled to a quarterly dividend
payment of 100 times the dividend declared per Common Share. In the event of
liquidation, the holders of the Preferred Shares will be entitled to an
aggregate payment of 100 times the aggregate payment made per Common Share. Each
Preferred Share will have 100 votes, voting together with the Common Shares. In
the event of any merger, consolidation or other transaction in which Common
Shares are exchanged, each Preferred Share will be entitled to receive 100 times
the amount received per Common Share. These rights are protected by customary
antidilution provisions.
Because of the nature of the Preferred Shares' dividend, liquidation and voting
rights, the value of the one one-hundredth interest in a Preferred Share
purchasable upon exercise of each Common Stock Right should approximate the
value of one Common Share.
From and after the occurrence of an event described in Section 11(a)(ii) of the
Rights Agreement, if the Common Stock Rights evidenced by a Series B Right
Certificate are or were at any time on or after the earlier of (x) the date of
such event and (y) the Distribution Date (as such term is defined in the Rights
Agreement) acquired or beneficially owned by an Acquiring Person or an Associate
or Affiliate of an Acquiring Person (as such terms are defined in the Rights
Agreement), such Common Stock Rights shall become void, and any holder of such
Common Stock Rights shall thereafter have no right to exercise such Common Stock
Rights.
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In the event that, at any time after a Person becomes an Acquiring Person, the
Company is acquired in a merger or other business combination transaction or 50%
or more of its consolidated assets or earning power are sold, proper provision
will be made so that each holder of a Common Stock Right will thereafter have
the right to receive, upon the exercise thereof at the then current exercise
price of the Common Stock Right, that number of shares of common stock of the
acquiring company which at the time of such transaction will have a market value
of two times the exercise price of the Common Stock Right. In the event that any
person becomes an Acquiring Person, proper provision shall be made so that each
holder of a Common Stock Right, other than Common Stock Rights beneficially
owned by the Acquiring Person and its Affiliates and Associates (which will
thereafter be void), will thereafter have the right to receive upon exercise
that number of Common Shares having a market value of two times the exercise
price of the Common Stock Right. If the Company does not have sufficient Common
Shares to satisfy such obligation to issue Common Shares, or if the Board of
Directors so elects, the Company shall deliver upon payment of the exercise
price of a Common Stock Right an amount of cash or securities equivalent in
value to the Common Shares issuable upon exercise of a Common Stock Right;
provided that, if the Company fails to meet such obligation within 30 days
following the later of (x) the first occurrence of an event triggering the right
to purchase Common Shares and (y) the date on which the Company's right to
redeem the Common Stock Rights expires, the Company must deliver, upon exercise
of a Common Stock Right but without requiring payment of the exercise price then
in effect, Common Shares (to the extent available) and cash equal in value to
the difference between the value of the Common Shares otherwise issuable upon
the exercise of a Common Stock Right and the exercise price then in effect. The
Board of Directors may extend the 30-day period described above for up to an
additional 60 days to permit the taking of action that may be necessary to
authorize sufficient additional Common Shares to permit the issuance of Common
Shares upon the exercise in full of the Common Stock Rights.
At any time after any Person becomes an Acquiring Person and prior to the
acquisition by any person or group of a majority of the outstanding Common
Shares, the Board of Directors of the Company may exchange the Common Stock
Rights (other than Common Stock Rights owned by such person or group which have
become void), in whole or in part, at an exchange ratio of one Common Share per
Common Stock Right (subject to adjustment).
With certain exceptions, no adjustment in the Series B Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Series B Purchase Price. No fractional Preferred Shares will be issued
(other than fractions which are integral multiples of one one-hundredth of a
Preferred Share, which may, at the election of the Company, be evidenced by
depositary receipts) and in lieu thereof, an adjustment in cash will be made
based on the market price of the Preferred Shares on the last trading day prior
to the date of exercise.
At any time prior to the time any Person becomes an Acquiring Person, the Board
of Directors of the Company may redeem the Common Stock Rights in whole, but not
in part, at a price of $0.01 per Common Stock Right (the "Redemption Price").
The redemption of the Common Stock Rights may be made effective at such time, on
such basis and with such conditions as the Board of Directors in its sole
discretion may establish. Immediately upon any redemption of the
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Common Stock Rights, the right to exercise the Common Stock Rights will
terminate and the only right of the holders of Common Stock Rights will be to
receive the Redemption Price.
The terms of the Common Stock Rights may be amended by the Board of Directors of
the Company without the consent of the holders of the Common Stock Rights,
except that from and after such time as any person becomes an Acquiring Person
no such amendment may adversely affect the interests of the holders of the
Common Stock Rights (other than the Acquiring Person and its Affiliates and
Associates).
Until a Common Stock Right is exercised, the holder thereof, as such, will have
no rights as a stockholder of the Company, including, without limitation, the
right to vote or to receive dividends.
II. SUMMARY OF CLASS A COMMON STOCK RIGHTS TO PURCHASE SERIES C PREFERRED
SHARES
Each Class A Common Stock Right entitles the registered holder to purchase from
the Company one one-hundredth of a share of Series C Junior Participating
Preferred Stock, par value $0.01 per share (the "Series C Preferred Shares"), of
the Company, at a price of $39.00 per one one-hundredth of a Preferred Share
(the "Series C Purchase Price"), subject to adjustment.
Until the earlier to occur of (i) 10 days following a public announcement that a
person or group of affiliated or associated persons (an "Acquiring Person") has
acquired beneficial ownership of 15% or more of the outstanding Class A Common
Shares or (ii) 10 business days (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) following the commencement of, or announcement of an intention
to make, a tender offer or exchange offer the consummation of which would result
in the beneficial ownership by a person or group of 15% or more of such
outstanding Class A Common Shares (the earlier of such dates being called the
"Distribution Date"), the Class A Common Stock Rights will be evidenced, with
respect to any of the Class A Common Share certificates outstanding as of the
Record Date, by such Class A Common Share certificate with a copy of a Summary
of Rights to Purchase Series C Preferred Stock attached thereto.
The Rights Agreement provides that, until the Distribution Date, the Class A
Common Stock Rights will be transferred with and only with the Class A Common
Shares. Until the Distribution Date (or earlier redemption or expiration of the
Class A Common Stock Rights), new Class A Common Share certificates issued after
the Record Date or upon transfer or new issuance of Class A Common Shares will
contain a notation incorporating the Rights Agreement by reference. Until the
Distribution Date (or earlier redemption or expiration of the Class A Common
Stock Rights), the surrender for transfer of any certificates for Class A Common
Shares, even without such notation or a copy of this Summary of Rights to
Purchase Series C Preferred Stock being attached thereto, will also constitute
the transfer of the Class A Common Stock Rights associated with the Class A
Common Shares represented by such certificate. As soon as practicable following
the Distribution Date, separate certificates evidencing the Class A Common Stock
Rights ("Series C Right Certificates") will be mailed to holders of record of
the
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Class A Common Shares as of the Close of Business on the Distribution Date and
such separate Series C Right Certificates alone will evidence the Class A Common
Stock Rights.
The Class A Common Stock Rights are not exercisable until the Distribution Date.
The Class A Common Stock Rights will expire on November 2, 2013 (the "Final
Expiration Date"), unless the Final Expiration Date is extended or unless the
Class A Common Stock Rights are earlier redeemed by the Company, in each case,
as described below.
The Series C Purchase Price payable, and the number of Series C Preferred Shares
or other securities or property issuable, upon exercise of the Class A Common
Stock Rights are subject to adjustment from time to time to prevent dilution (i)
in the event of a stock dividend on, or a subdivision, combination or
reclassification of, the Series C Preferred Shares, (ii) upon the grant to
holders of the Series C Preferred Shares of certain rights or warrants to
subscribe for or purchase Series C Preferred Shares at a price, or securities
convertible into Series C Preferred Shares with a conversion price, less than
the then current market price of the Series C Preferred Shares or (iii) upon the
distribution to holders of the Series C Preferred Shares of evidences of
indebtedness or assets (excluding regular periodic cash dividends paid out of
earnings or retained earnings or dividends payable in Series C Preferred Shares)
or of subscription rights or warrants (other than those referred to above).
The number of outstanding Class A Common Stock Rights and the number of one
one-hundredth of a Preferred Share issuable upon exercise of each Right are also
subject to adjustment in the event of a stock split of the Class A Common Shares
or a stock dividend on the Class A Common Shares payable in Class A Common
Shares or subdivisions, consolidations or combinations of the Class A Common
Shares occurring, in any such case, prior to the Distribution Date.
Series C Preferred Shares purchasable upon exercise of the Class A Common Stock
Rights will not be redeemable. Each Preferred Share will be entitled to a
quarterly dividend payment of 100 times the dividend declared per Class A Common
Share. In the event of liquidation, the holders of the Series C Preferred Shares
will be entitled to an aggregate payment of 100 times the aggregate payment made
per Class A Common Share. Each Preferred Share will have 10 votes, voting
together with the Class A Common Shares. In the event of any merger,
consolidation or other transaction in which Class A Common Shares are exchanged,
each Preferred Share will be entitled to receive 100 times the amount received
per Class A Common Share. These rights are protected by customary antidilution
provisions.
Because of the nature of the Series C Preferred Shares' dividend, liquidation
and voting rights, the value of the one one-hundredth interest in a Preferred
Share purchasable upon exercise of each Right should approximate the value of
one Class A Common Share.
From and after the occurrence of an event described in Section 11(a)(ii) of the
Rights Agreement, if the Class A Common Stock Rights evidenced by this Series C
Right Certificates are or were at any time on or after the earlier of (x) the
date of such event and (y) the Distribution Date (as such term is defined in the
Rights Agreement) acquired or beneficially owned by an Acquiring Person
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or an Associate or Affiliate of an Acquiring Person (as such terms are defined
in the Rights Agreement), such Class A Common Stock Rights shall become void,
and any holder of such Class A Common Stock Rights shall thereafter have no
right to exercise such Class A Common Stock Rights.
In the event that, at any time after a Person becomes an Acquiring Person, the
Company is acquired in a merger or other business combination transaction or 50%
or more of its consolidated assets or earning power are sold, proper provision
will be made so that each holder of a Right will thereafter have the right to
receive, upon the exercise thereof at the then current exercise price of the
Right, that number of shares of common stock of the acquiring company which at
the time of such transaction will have a market value of two times the exercise
price of the Right. In the event that any person becomes an Acquiring Person,
proper provision shall be made so that each holder of a Right, other than Class
A Common Stock Rights beneficially owned by the Acquiring Person and its
Affiliates and Associates (which will thereafter be void), will thereafter have
the right to receive upon exercise that number of Class A Common Shares having a
market value of two times the exercise price of the Right. If the Company does
not have sufficient Class A Common Shares to satisfy such obligation to issue
Class A Common Shares, or if the Board of Directors so elects, the Company shall
deliver upon payment of the exercise price of a Right an amount of cash or
securities equivalent in value to the Class A Common Shares issuable upon
exercise of a Right; provided that, if the Company fails to meet such obligation
within 30 days following the later of (x) the first occurrence of an event
triggering the right to purchase Class A Common Shares and (y) the date on which
the Company's right to redeem the Class A Common Stock Rights expires, the
Company must deliver, upon exercise of a Right but without requiring payment of
the exercise price then in effect, Class A Common Shares (to the extent
available) and cash equal in value to the difference between the value of the
Class A Common Shares otherwise issuable upon the exercise of a Right and the
exercise price then in effect. The Board of Directors may extend the 30-day
period described above for up to an additional 60 days to permit the taking of
action that may be necessary to authorize sufficient additional Class A Common
Shares to permit the issuance of Class A Common Shares upon the exercise in full
of the Class A Common Stock Rights.
At any time after any Person becomes an Acquiring Person and prior to the
acquisition by any person or group of a majority of the outstanding Class A
Common Shares, the Board of Directors of the Company may exchange the Class A
Common Stock Rights (other than Class A Common Stock Rights owned by such person
or group which have become void), in whole or in part, at an exchange ratio of
one Class A Common Share per Right (subject to adjustment).
With certain exceptions, no adjustment in the Series C Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Series C Purchase Price. No fractional Series C Preferred Shares will be
issued (other than fractions which are integral multiples of one one-thousandth
of a Preferred Share, which may, at the election of the Company, be evidenced by
depositary receipts) and in lieu thereof, an adjustment in cash will be made
based on the market price of the Series C Preferred Shares on the last trading
day prior to the date of exercise.
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At any time prior to the time any Person becomes an Acquiring Person, the Board
of Directors of the Company may redeem the Class A Common Stock Rights in whole,
but not in part, at a price of $0.01 per Right (the "Redemption Price"). The
redemption of the Class A Common Stock Rights may be made effective at such
time, on such basis and with such conditions as the Board of Directors in its
sole discretion may establish. Immediately upon any redemption of the Class A
Common Stock Rights, the right to exercise the Class A Common Stock Rights will
terminate and the only right of the holders of Class A Common Stock Rights will
be to receive the Redemption Price.
The terms of the Class A Common Stock Rights may be amended by the Board of
Directors of the Company without the consent of the holders of the Class A
Common Stock Rights, except that from and after such time as any person becomes
an Acquiring Person no such amendment may adversely affect the interests of the
holders of the Class A Common Stock Rights (other than the Acquiring Person and
its Affiliates and Associates).
Until a Right is exercised, the holder thereof, as such, will have no rights as
a stockholder of the Company, including, without limitation, the right to vote
or to receive dividends.
This summary description of the Common Stock Rights and Class A Common Stock
Rights does not purport to be complete and is qualified in its entirety by
reference to the Rights Agreement, which is hereby incorporated herein by
reference.
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ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits:
Exhibit No. Exhibit Title
- ----------- -------------
4.0 Rights Agreement dated as of November 2, 2003 between HEICO
Corporation and SunTrust Bank, a Georgia banking corporation, as
Rights Agent. The Rights Agreement includes, as Exhibit A,
Articles of Amendment of HEICO Corporation, as Exhibit B, Form of
Series B Preferred Stock Rights Certificate, as Exhibit C,
Summary of Rights to Purchase Series B Preferred Stock, as
Exhibit D, Form of Series C Preferred Stock Rights Certificate,
as Exhibit E, Summary of Rights to Purchase Series C Preferred
Stock.
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SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
HEICO CORPORATION
By: /s/Thomas S. Irwin
--------------------------------
Thomas S. Irwin
Executive Vice President and
Chief Financial Officer
Date: November 4, 2003
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EXHIBIT INDEX
Exhibit No. Exhibit Title
- ----------- -------------
4.0 Rights Agreement dated as of November 2, 2003 between HEICO
Corporation and SunTrust Bank, a Georgia banking corporation, as
Rights Agent. The Rights Agreement includes, as Exhibit A,
Articles of Amendment of HEICO Corporation, as Exhibit B, Form of
Series B Preferred Stock Rights Certificate, as Exhibit C,
Summary of Rights to Purchase Series B Preferred Stock, as
Exhibit D, Form of Series C Preferred Stock Rights Certificate,
as Exhibit E, Summary of Rights to Purchase Series C Preferred
Stock.
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EXHIBIT 4.0
HEICO CORPORATION
and
SUNTRUST BANK
Rights Agent
Rights Agreement
Dated as of November 2, 2003
TABLE OF CONTENTS
PAGE
- ----
Section 1. Certain Definitions 1
Section 2. Appointment of Rights Agent 5
Section 3. Issue of Right Certificates 5
Section 4. Form of Right Certificates. 5
Section 5. Countersignature and Registration 7
Section 6. Transfer, Split Up, Combination and Exchange of Right Certificates; 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. 9
Section 9. Status and Availability of Preferred Shares 9
Section 10. Preferred Shares Record Date. 9
Section 11. Adjustment of Purchase Price, Number of Shares or Number of Rights. 10
Section 12. Certificate of Adjustment 16
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earning Power. 16
Section 14. Fractional Rights and Fractional Shares 17
Section 15. Rights of Action. 18
Section 16. Agreement of Right Holders. 18
Section 17. Right Certificate Holder Not Deemed a Stockholder 18
Section 18. Concerning the Rights Agent 19
Section 19. Merger or Consolidation or Change of Name of Rights Agent 19
Section 20. Duties of Rights Agent. 19
Section 21. Change of Rights Agent. 21
Section 22. Issuance of New Right Certificates. 21
Section 23. Redemption. 21
Section 24. Exchange. 22
Section 25. Notice of Certain Events. 23
Section 26. Notices 24
Section 27. Supplements and Amendments. 25
Section 28. Successors. 25
Section 29. Benefits of this Agreement. 25
Section 30. Severability. 25
Section 31. Governing Law 25
Section 32. Counterparts. 25
Section 33. Descriptive Headings. 25
Section 34. Administration. 25
Exhibit A Articles of Amendment of Heico Corporation A-1
Exhibit B Form of Series B Preferred Stock Right Certificate B-1
Exhibit C Summary of Rights to Purchase Series B Preferred Stock. C-1
Exhibit D Form of Series C Preferred Stock Right Certificate D-1
Exhibit E Summary of Rights to Purchase Series C Preferred Stock. E-1
ii
RIGHTS AGREEMENT
Agreement, dated as of November 2, 2003 between HEICO Corporation, a Florida
corporation (the "Company"), and SunTrust Bank, a Georgia banking corporation
(the "Rights Agent").
The Board of Directors of the Company has authorized and declared a dividend of
one preferred share purchase right (a "Common Stock Right") for each share of
Common Stock, par value $0.01 per share, of the Company (a "Common Share")
outstanding at the Close of Business on November 2, 2003 (the "Common Stock
Record Date") and has authorized the issuance of one Right with respect to each
additional Common Share that shall become outstanding between the Record Date
and the earlier of the Distribution Date, the Redemption Date or the Final
Expiration Date (as such terms are defined in Sections 1, 3 and 7 hereof), each
Common Stock Right representing the right to purchase one one-hundredth (1/100)
of a Series B Preferred Share, as hereinafter defined, or such different amount
and/or kind of securities as shall be hereinafter provided.
The Board of Directors of the Company has authorized and declared a dividend of
one preferred share purchase right (a "Class A Common Stock Right") for each
share of Class A Common Stock, par value $0.01 per share, of the Company (a
"Class A Common Share") outstanding at the Close of Business on November 2, 2003
(the "Class A Common Stock Record Date") and has authorized the issuance of one
Right with respect to each additional Class A Common Share that shall become
outstanding between the Record Date and the earlier of the Distribution Date,
the Redemption Date or the Final Expiration Date (as such terms are defined in
Sections 1, 3 and 7 hereof), each Common Stock Right representing the right to
purchase one one-hundredth (1/100) of a Series C Preferred Share, as hereinafter
defined, or such different amount and/or kind of securities as shall be
hereinafter provided.
A Common Stock Right and a Class A Common Stock Right are sometimes hereinafter
collectively referred to as a "Right" and the Common Stock Record Date and the
Class A Common Stock Record Date are sometimes hereinafter collectively referred
to as the "Record Date".
Accordingly, in consideration of the premises and the mutual agreements herein
set forth, the parties hereby agree as follows:
Section 1. CERTAIN DEFINITIONS.
For purposes of this Agreement, the following terms have the meanings indicated:
"Acquiring Person" shall mean any Person who or which, together with all
Affiliates and Associates of such Person, shall be the Beneficial Owner of 15%,
or more of the Common Shares and/or Class A Common Shares of the Company then
outstanding but shall not include (i) the Company, (ii) any Subsidiary of the
Company, (iii) any employee benefit plan of the Company or any Subsidiary of the
Company, or (iv) any entity holding Common Shares and/or Class A Common Shares
for or pursuant to the terms of any such employee benefit plan. Notwithstanding
the foregoing, (1) no Person shall become an "Acquiring Person" as the result of
an acquisition of Common Shares and/or Class A Common Shares by the Company
which, by reducing the number of shares outstanding, increases the proportionate
number of shares beneficially owned by such Person to 15% or more of the Common
Shares and/or Class A Common Shares of the Company then outstanding; PROVIDED,
HOWEVER, that if a Person shall so become the Beneficial Owner of 15% or more of
the Common Shares and/or Class A Common Shares of
the Company then outstanding by reason of an acquisition of Common Shares and/or
Class A Common Shares by the Company and shall, after such share purchases by
the Company, become the Beneficial Owner of an additional 1% of the outstanding
Common Shares and/or Class A Common Shares of the Company, then such Person
shall be deemed to be an "Acquiring Person"; (2) if the Board of Directors of
the Company determines in good faith that a Person who would otherwise be an
"Acquiring Person," as defined pursuant to the foregoing provisions of this
paragraph, has become such inadvertently, and such Person divests as promptly as
practicable a sufficient number of Common Shares and/or Class A Common Shares so
that such Person would no longer be an "Acquiring Person," as defined pursuant
to the foregoing provisions of this paragraph, then such Person shall not be
deemed to have become an "Acquiring Person" for any purposes of this Agreement;
(3) no Person beneficially owning (together with such Person's Affiliates and
Associates) 15% or more of the Common Shares and/or Class A Common Shares as of
the Record Date (an "Original 15% Shareholder") and no Affiliate or Associate of
any such Original 15% Shareholder shall be an Acquiring Person; PROVIDED,
HOWEVER, that if such Person shall subsequently become the Beneficial Owner of
an additional 1% of the outstanding Common Shares and/or Class A Common Shares
of the Company as a result of an acquisition of Common Shares and/or Class A
Common Shares which is not approved by a majority of the Company's Disinterested
Directors then in office, then such Person shall be deemed to be an "Acquiring
Person"; (4) no Person shall become an "Acquiring Person" as the result of
either an acquisition of Common Shares and/or Class A Common Shares or the grant
of options exercisable for Common Shares and/or Class A Common Shares (and
subsequent exercise of those options) which has been approved by the majority of
the Company's Disinterested Directors then in office; PROVIDED, HOWEVER, that if
such Person shall subsequently become the Beneficial Owner of an additional 1%
of the outstanding Common Shares and/or Class A Common Shares of the Company as
a result of an acquisition of Common Shares and/or Class A Common Shares which
is not approved by a majority of the Company's Disinterested Directors then in
office, then such Person shall be deemed to be an "Acquiring Person"; and (5) no
Person shall become an "Acquiring Person" as a result of an acquisition of
Common Shares and/or Class A Common Shares in a stock acquisition of or a tender
or exchange offer for all of the Company's Common Shares and/or Class A Common
Shares pursuant to a definitive agreement by which such Person (absent the
provisions of this subparagraph (5)) would become an Acquiring Person and which
has been approved by a majority of the Company's Disinterested Directors then in
office prior to the execution of the definitive agreement providing for the
acquisition or the public announcement of the offer, as the case may be.
"Affiliate" and "Associate" shall have the respective meanings ascribed to such
terms in Rule 12b-2 of the General Rules and Regulations under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), as in effect on the date
of this Agreement.
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 beneficially owns, directly or indirectly;
(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 (other than customary agreements with and between
underwriters and selling group members with respect to a bona fide public
offering of securities), written or otherwise, or upon the exercise of
conversion rights, exchange rights, rights (other than the Rights), warrants or
options, or otherwise; PROVIDED, HOWEVER, that a Person shall not be deemed to
be the Beneficial Owner of, or to beneficially own, securities tendered pursuant
to a tender or exchange offer
-2-
made pursuant to, and in accordance with, the applicable rules and regulations
promulgated under the Exchange Act 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; or (B) the right to vote pursuant to any agreement,
arrangement or understanding; PROVIDED, HOWEVER, that a Person shall not be
deemed the Beneficial Owner of, or to beneficially own, any security if the
agreement, arrangement or understanding to vote such security (1) arises solely
from a revocable proxy or consent given to such Person in response to a public
proxy or consent solicitation made pursuant to, and in accordance with, the
applicable rules and regulations promulgated under the Exchange Act and (2) is
not also then reportable on Schedule 13D under the Exchange Act (or any
comparable or successor report); or
(iii) which are beneficially owned, directly or indirectly, by any
other Person with which such Person or any of such Person's Affiliates or
Associates has any agreement, arrangement or understanding (other than customary
agreements with and between underwriters and selling group members with respect
to a bona fide public offering of securities), written or otherwise, for the
purpose of acquiring, holding, voting (except to the extent contemplated by the
proviso to section (B) of the immediately preceding paragraph (ii)) or disposing
of any securities of the Company.
Notwithstanding anything in this definition of Beneficial Ownership to the
contrary, the phrase "then outstanding," when used with reference to a Person's
Beneficial Ownership of securities of the Company, shall mean the number of such
securities then issued and outstanding together with the number of such
securities not then actually issued and outstanding which such Person would be
deemed to own beneficially hereunder.
"Business Day" shall mean any day other than a Saturday, Sunday, or a day on
which banking institutions in the State of Florida are authorized or obligated
by law or executive order to close.
"Class A Common Shares" when used with reference to the Company shall mean the
shares of Class A common stock, par value $0.01 per share, of the Company.
"Close of Business" on any given date shall mean 5:00 P.M., Miami, Florida, on
such date; PROVIDED, HOWEVER, that if such date is not a Business Day it shall
mean 5:00 P.M., Miami, Florida, on the next succeeding Business Day.
"Common Shares" when used with reference to the Company shall mean the shares of
common stock, par value $0.01 per share, of the Company. "Common Shares" when
used with reference to any Person other than the Company shall mean the capital
stock (or equity interest) with the greatest voting power of such other Person
or, if such other Person is a Subsidiary of another Person, the Person or
Persons which ultimately control such first-mentioned Person.
"common stock equivalents" shall have the meaning set forth in Section
11(a)(iii)(B)(3) hereof.
"Current Value" shall have the meaning set forth in Section 11(a)(iii)(A)(1)
hereof.
"Disinterested Director" shall mean any member of the Company's Board of
Directors who is not (i) an employee of the Company or any of its subsidiaries,
(ii) an Acquiring Person or an Affiliate or Associate of any such Person or a
representative or nominee of an Acquiring Person or any such Affiliate or
Associate or (iii) a Person seeking approval to acquire Common Shares and/or
Class A Common Shares under one of the exceptions set forth in the definition of
"Acquiring Person" so as to not be deemed to be
-3-
an "Acquired Person" or an Affiliate or Associate of such Person or a
representative or nominee of such Person or any such Affiliate or Associate.
"Distribution Date" shall have the meaning set forth in Section 3 hereof.
"equivalent preferred shares" shall have the meaning set forth in Section 11(b)
hereof.
"Exchange Ratio" shall have the meaning set forth in Section 24(a) hereof.
"Final Expiration Date" shall mean November 2, 2013.
"Person" shall mean any individual, firm, corporation, partnership, limited
partnership, limited liability partnership, business trust, limited liability
company, unincorporated association or other entity, and shall include any
successor (by merger or otherwise) of such entity.
"Preferred Shares" shall collectively mean shares of Series B Junior
Participating Preferred Stock, par value $0.01 per share, of the Company and
shares of Series C Junior Participating Preferred Stock, par value $0.01 per
share, of the Company.
"Purchase Price" shall collectively mean the Series B Purchase Price and the
Series C Purchase Price.
"Redemption Date" shall mean the date on which the Rights are redeemed as
provided in Section 23 hereof.
"Right Certificate" shall collectively mean a certificate evidencing a Right in
substantially the form of Exhibit B and/or Exhibit D hereto.
"Section 11(a)(ii) Trigger Date" shall have the meaning set forth in Section
11(a)(iii) hereof.
"Series B Preferred Shares" shall mean shares of Series B Junior Participating
Preferred Stock, par value $0.01 per share, of the Company.
"Series B Purchase Price" shall have the meaning set forth in Section 7(b)
hereof.
"Series B Right Certificate" shall mean a certificate evidencing a Right in
substantially the form of Exhibit B hereto.
"Series B Summary of Rights" shall mean the Summary of Rights to Purchase Series
B Preferred Shares in substantially the form of Exhibit C hereto.
"Series C Preferred Shares" shall mean shares of Series C Junior Participating
Preferred Stock, par value $0.01 per share, of the Company.
"Series C Purchase Price" shall have the meaning set forth in Section 7(b)
hereof.
"Series C Right Certificate" shall mean a certificate evidencing a Right in
substantially the form of Exhibit D hereto.
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"Series C Summary of Rights" shall mean the Summary of Rights to Purchase Series
C Preferred Shares in substantially the form of Exhibit E hereto.
"Shares Acquisition Date" shall mean the earlier of the date of (i) the public
announcement by the Company or an Acquiring Person that an Acquiring Person has
become such or (ii) the public disclosure of facts by the Company or an
Acquiring Person indicating that an Acquiring Person has become such.
"Spread" shall have the meaning set forth in Section 11(a)(iii)(A)(2) hereof.
"Subsidiary" of any Person shall mean any Person of which a majority of the
voting power of the voting equity securities or equity interest is owned,
directly or indirectly, by such Person.
"Substitution Period" shall have the meaning set forth in Section 11(a)(iii)
hereof.
"Summary of Rights" shall mean collectively the Series B Summary of Rights to
Purchase Series B Preferred Shares in substantially the form of Exhibit C hereto
and the Series C Summary of Rights to Purchase Series C Preferred Shares in
substantially the form of Exhibit E hereto.
Section 2. APPOINTMENT OF RIGHTS AGENT. The Company hereby appoints the Rights
Agent to act as agent for the Company and the holders of the Rights (who, in
accordance with Section 3 hereof, shall prior to the Distribution Date also be
the holders of the Common Shares and/or Class A Common Shares) 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 upon ten (10) days' prior written notice to
the Rights Agent. The Rights Agent shall have no duty to supervise, and in no
event 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 day after the Shares
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 date of the commencement by any Person
(other than the Company, any Subsidiary of the Company, any employee benefit
plan of the Company or of any Subsidiary of the Company or any entity holding
Common Shares and/or Class A Common Shares for or pursuant to the terms of any
such plan) of, or of the first public announcement of the intention of any
Person (other than any of the Persons referred to in the preceding
parenthetical) to commence, a tender or exchange offer the consummation of which
would result in any Person becoming an Acquiring Person (such date being herein
referred to as the "Distribution Date"), (x) the Rights will be evidenced
(subject to the provisions of Section 3(b) hereof) by the certificates for
Common Shares and/or Class A Common Shares registered in the names of the
holders thereof (which certificates shall also be deemed 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 Shares and/or Class A Common Shares. As soon as practicable
after the Distribution Date, the Company will prepare and execute, the Rights
Agent will countersign, and the Company will send or cause to be sent (and the
Rights Agent will, if requested, send) by first-class, insured, postage-prepaid
mail, to each holder of record 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 evidencing one Right for each Common Share and/or Class A Common
Shares so held. As of the Distribution Date, the Rights will be evidenced solely
by such Right Certificates.
-5-
(b) On the Record Date, or as soon as practicable thereafter, the
Company will send a copy of the Summary of Rights by first-class,
postage-prepaid mail, to each holder of record as of the Close of Business on
the Record Date, at the address of such holder shown on the records of the
Company. With respect to certificates for Common Shares and/or Class A Common
Shares outstanding as of the Record Date, until the Distribution Date, the
Rights will be evidenced by such certificates registered in the names of the
holders thereof together with a copy of the Series B Summary of Rights and/or
Series C Summary of Rights attached thereto. Until the Distribution Date (or the
earlier of the Redemption Date or the Final Expiration Date), the surrender for
transfer of any certificate for Common Shares and/or Class A Common Shares
outstanding on the Record Date, with or without a copy of the Series B Summary
of Rights and/or Series C Summary of Rights attached thereto, shall also
constitute the transfer of the Rights associated with the Common Shares and/or
Class A Common Shares evidenced thereby.
(c) Certificates for Common Shares and/or Class A Common Shares
which become outstanding (including, without limitation, reacquired Common
Shares and/or Class A Common Shares referred to in the last sentence of this
paragraph (c)) after the Record Date but prior to the earliest of the
Distribution Date, the Redemption Date or the Final Expiration Date 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 Heico
Corporation and SunTrust Bank, as Rights Agent, dated as of November 2,
2003 (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 Heico Corporation. 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. Heico Corporation will mail to the holder of this
certificate a copy of the Rights Agreement without charge after receipt
of a written request therefor. Under certain circumstances, Rights that
are or were acquired or beneficially owned by Acquiring Persons (as
defined in the Rights Agreement) may become null and void."
With respect to such certificates containing the foregoing legend, until the
Distribution Date, the Rights associated with the Common Shares and/or Class A
Common Shares represented by certificates shall be evidenced by such
certificates alone, and the surrender for transfer of any such certificate shall
also constitute the transfer of the Rights associated with the Common Shares
and/or Class A Common Shares represented thereby. In the event that the Company
purchases or acquires any Common Shares and/or Class A Common Shares after the
Record Date but prior to the Distribution Date, any Rights associated with such
Common Shares and/or Class A Common Shares shall be deemed canceled and retired
so that the Company shall not be entitled to exercise any Rights associated with
the Common Shares and/or Class A Common Shares that are no longer outstanding.
Section 4. FORM OF RIGHT CERTIFICATES. The (i) Series B Right Certificates (and
the forms of election to purchase Series B Preferred Shares and of assignment to
be printed on the reverse thereof) shall be substantially the same as Exhibit B
hereto and (ii) Series C Right Certificates (and the forms of election to
purchase Series C Preferred Shares and of assignment to be printed on the
reverse thereof) shall be substantially the same as Exhibit D hereto and both
may have such marks of identification or designation and such legends, summaries
or endorsements printed thereon as the Company may deem appropriate and as are
not inconsistent with the provisions of this Agreement, or as may be required to
comply with any applicable law or with any rule or regulation 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
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usage. Subject to the other provisions of this Agreement: (i) the Series B Right
Certificates shall entitle the holders thereof to purchase such number of one
one-hundredth of a Series B Preferred Share as shall be set forth therein at the
Series B Purchase Price, but the number of one one-hundredth of a Series B
Preferred Share and the Series B Purchase Price shall be subject to adjustment
as provided herein and (ii) the Series C Right Certificates shall entitle the
holders thereof to purchase such number of one one-hundredth of a Series C
Preferred Share as shall be set forth therein at the Series C Purchase Price,
but the number of one one-hundredth of a Series C Preferred Share and the Series
C Purchase Price shall be subject to adjustment as provided herein.
Section 5. COUNTERSIGNATURE AND REGISTRATION. The Right Certificates shall be
executed on behalf of the Company by its Chairman of the Board, its Chief
Executive Officer, its President, or any of its Vice Presidents, either manually
or by facsimile signature, shall have affixed thereto the Company's seal or a
facsimile thereof, and shall be attested by the Secretary or any Assistant
Secretary of the Company, either manually or by facsimile signature. The Right
Certificates shall be countersigned by the Rights Agent and shall not be valid
for any purpose unless so countersigned, either manually or by facsimile. 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
and issued and delivered by the Company 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.
Following the Distribution Date, the Rights Agent will keep or cause to be kept,
at its principal office, books for registration of the 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 CERTIFICATES;
MUTILATED, DESTROYED, LOST OR STOLEN RIGHT CERTIFICATES. 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 earlier of
the Redemption Date or the Final Expiration Date, any Right Certificate or Right
Certificates (other than Right Certificates representing Rights that have become
void pursuant to Section 11(a)(ii) hereof or that have been exchanged pursuant
to Section 24 hereof) 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-hundredth of a Series B Preferred Share
and/or Series C Preferred Share 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 or
Right Certificates 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 payment of a sum sufficient for
any tax or governmental charge that may be imposed in connection with any
transfer, split up, combination or exchange of Right Certificates.
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
-7-
indemnity or security reasonably satisfactory to them, and, at the Company's
request, 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 holder 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 (other than a
holder whose Rights have become void pursuant to Section 11(a)(ii) hereof or
have been exchanged pursuant to Section 24 hereof) may exercise the Rights
evidenced thereby 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 executed, to the Rights Agent at its principal
office, together with payment of the Series B Purchase Price and/or Series C
Purchase Price for each one one-hundredth of a Series B Preferred Share and/or
Series C Preferred Share as to which the Rights are exercised, at or prior to
the earliest of (i) the Close of Business on the Final Expiration Date, (ii) the
Redemption Date, or (iii) the time at which such Rights are exchanged as
provided in Section 24 hereof.
(b) The purchase price for each one one-hundredth of a: (i) Series B
Preferred Share to be purchased upon the exercise of a Right shall initially be
Forty-Five ($45.00) (the "Series B Purchase Price"), shall be subject to
adjustment from time to time as provided in Sections 11 and 13 hereof and shall
be payable in lawful money of the United States of America in accordance with
paragraph (c) below and (ii) Series C Preferred Share to be purchased upon the
exercise of a Right shall initially be Thirty-Nine ($39.00) (the "Series C
Purchase Price"), shall be subject to adjustment from time to time as provided
in Sections 11 and 13 hereof and shall be payable in lawful money of the United
States of America in accordance with paragraph (c) below.
(c) Upon receipt of a Right Certificate representing exercisable
Rights, with the form of election to purchase and certificate duly executed,
accompanied by payment of the Purchase Price for the number of one one-hundredth
of a Series B Preferred Share and/or Series C Preferred Share to be purchased
and an amount equal to any applicable transfer tax required to be paid by the
holder of such Right Certificate in accordance with Section 9 hereof by cash,
certified check, cashier's check or money order payable to the order of the
Company, the Rights Agent shall thereupon promptly (i) (A) requisition from any
transfer agent of the Series B Preferred Share certificates and/or Series C
Preferred Share certificates for the number of one one-hundredth of a Series B
Preferred Share and/or Series C Preferred Share to be purchased and the Company
hereby irrevocably authorizes its transfer agent to comply with all such
requests, or (B) requisition from any depositary agent for the Series B
Preferred Share and/or Series C Preferred Share depositary receipts representing
such number of one one-hundredth of a Series B Preferred Share and/or Series C
Preferred Share as are to be purchased (in which case certificates for the
Series B Preferred Share and/or Series C Preferred Share represented by such
receipts shall be deposited by the transfer agent with the depositary agent) and
the Company hereby directs the depositary agent to comply with such request,
(ii) when appropriate, requisition from the Company the amount of cash to be
paid in lieu of issuance of fractional Series B Preferred Share and/or Series C
Preferred Share in accordance with Section 14 hereof, (iii) after receipt of
such certificates or depositary receipts, 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, deliver such cash to or upon the order of the
registered holder of such Right Certificate.
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(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 hereof.
(e) Notwithstanding anything in this Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder upon the occurrence of any purported
exercise as set forth in this Section 7 unless such registered holder shall have
(i) completed and signed the certificate following 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 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. STATUS AND AVAILABILITY OF PREFERRED SHARES.
(a) The Company covenants and agrees that it will take all such
action as may be necessary to ensure that all Series B Preferred Shares and/or
Series C Preferred Shares delivered upon exercise of Rights shall, at the time
of delivery of the certificates for such Series B Preferred Shares and/or Series
C Preferred Shares (subject to payment of the Purchase Price), be duly and
validly authorized and issued and fully paid and non-assessable shares.
(b) The Company further covenants and agrees that it will pay when
due and payable any and all federal and state transfer taxes and charges which
may be payable in respect of the issuance or delivery of the Right Certificates
or of any Series B Preferred Shares and/or Series C Preferred Shares upon the
exercise of Rights. The Company shall not, however, be required to pay any
transfer tax which may be payable in respect of any transfer or delivery of
Right Certificates to a person other than, or the issuance or delivery of
certificates or depositary receipts for the Series B Preferred Shares and/or
Series C Preferred Shares in a name other than that of, the registered holder of
the Right Certificate evidencing Rights surrendered for exercise or to issue or
to deliver any certificates or depositary receipts for Series B Preferred Shares
and/or Series C Preferred Shares upon the exercise of any Rights until any such
tax shall have been paid (any such tax being payable by the holder of such Right
Certificate at the time of surrender) or until it has been established to the
Company's reasonable satisfaction that no such tax is due.
(c) The Company covenants and agrees that it will cause to be
reserved and kept available, out of its authorized and unissued Series B
Preferred Shares and/or Series C Preferred Shares or any Preferred Shares held
in its treasury, the number of Series B Preferred Shares and/or Series C
Preferred Shares that will be sufficient to permit the exercise in full of all
outstanding Rights in accordance with Section 7 hereof.
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Section 10. PREFERRED SHARES RECORD DATE. Each person in whose name any
certificate for Series B Preferred Shares and/or Series C Preferred Shares is
issued upon the exercise of Rights shall for all purposes be deemed to have
become the holder of record of the Series B Preferred Shares and/or Series C
Preferred Shares 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 transfer
taxes) was made. Prior to the exercise of the Rights evidenced thereby, the
holder of a Right Certificate shall not be entitled to any rights of a holder of
Series B Preferred Shares and/or Series C Preferred 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 Preferred 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 a dividend on the Series B Preferred
Shares and/or Series C Preferred Shares payable in Series B Preferred
Shares and/or Series C Preferred Shares, respectively, (B) subdivide the
outstanding Series B Preferred Shares and/or Series C Preferred Shares,
(C) combine the outstanding Series B Preferred Shares and/or Series C
Preferred Shares into a smaller number of Series B Preferred Shares
and/or Series C Preferred Shares or (D) issue any shares of its capital
stock in a reclassification of the Series B Preferred Shares and/or
Series C Preferred Shares (including any such reclassification in
connection with a consolidation or merger in which the Company is the
continuing or surviving corporation), except as otherwise provided in
this Section 11(a), the Purchase Price in effect at the time of the
record date for such dividend or of the effective date of such
subdivision, combination or reclassification, and the number and kind of
shares of capital stock 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 shares of
capital stock which, if such Right had been exercised immediately prior
to such date, he would have owned upon such exercise and been entitled
to receive by virtue of such dividend, subdivision, combination or
reclassification; PROVIDED, HOWEVER, that in no event shall the
consideration to be paid upon the exercise of one Right be less than the
aggregate par value of the shares of capital stock of the Company
issuable upon exercise of one Right.
(ii) Subject to the following paragraph of this subparagraph
(ii) and to Section 24 of this Agreement, in the event any Person shall
become an Acquiring Person, each holder of a Right 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-hundredth of
a Series B Preferred Share and/or Series C Preferred Share for which a
Right is then exercisable, in accordance with the terms of this
Agreement and in lieu of Series B Preferred Shares and/or Series C
Preferred Shares, such number of Common Shares and/or Cass A Common
Shares of the Company as shall equal the result obtained by (x)
multiplying the then current Purchase Price by the number of one
one-hundredth of a Series B Preferred Shares and/or Series C Preferred
Shares for which a Right is then exercisable and dividing that product
by (y) 50% of the then current per share market price of the Company's
Common Shares and/or Class A Common Share, as the case may be,
(determined pursuant to Section 11(d) hereof) on the date such Person
became an Acquiring Person. In the event that any Person shall become an
Acquiring Person and the Rights shall then be outstanding, the Company
shall not take any action that would eliminate or diminish the benefits
intended to be afforded by the Rights.
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From and after the occurrence of such an event, any Rights that
are or were acquired or beneficially owned by such Acquiring Person (or
any Associate or Affiliate of such Acquiring Person) on or after the
earlier of (x) the date of such event and (y) the Distribution Date
shall be void and any holder of such Rights shall thereafter have no
right to exercise such Rights under any provision of this Agreement. No
Right Certificate shall be issued pursuant to Section 3 that represents
Rights beneficially owned by an Acquiring Person whose Rights would be
void pursuant to the preceding sentence or any Associate or Affiliate
thereof; no Right Certificate shall be issued at any time upon the
transfer of any Rights to an Acquiring Person whose Rights would be void
pursuant to the preceding sentence or any Associate or Affiliate thereof
or to any nominee of such Acquiring Person, Associate or Affiliate; and
any Right Certificate delivered to the Rights Agent for transfer to an
Acquiring Person whose Rights would be void pursuant to the preceding
sentence or any Associate or Affiliate thereof shall be canceled.
(iii) In the event that the number of Common Shares and/or
Class A Common Shares which are authorized by the Company's certificate
of incorporation and not outstanding or subscribed for, or reserved or
otherwise committed for issuance for purposes other than upon exercise
of the Rights, are not sufficient to permit the holder of each Right to
purchase the number of Common Shares and/or Class A Common Shares to
which he would be entitled upon the exercise in full of the Rights in
accordance with the foregoing subparagraph (ii) of paragraph (a) of this
Section 11, or should the Board of Directors so elect, the Company
shall: (A) determine the excess of (1) the value of the Common Shares
and/or Class A Common Shares issuable upon the exercise of a Right
(calculated as provided in the last sentence of this subparagraph (iii))
pursuant to Section 11(a)(ii) hereof (the "Current Value") over (2) the
Purchase Price (such excess, the "Spread"), and (B) with respect to each
Right, make adequate provision to substitute for such Common Shares
and/or Class A Common Shares, upon payment of the applicable Purchase
Price, any one or more of the following having an aggregate value
determined by the Board of Directors to be equal to the Current Value:
(1) cash, (2) a reduction in the Purchase Price, (3) Common Shares
and/or Class A Common Shares or other equity securities of the Company
(including, without limitation, shares, or units of shares, of preferred
stock which the Board of Directors of the Company has determined to have
the same value as shares of Common Stock and/or Class A Common Stock
(such shares of preferred stock, "common stock equivalents")), (4) debt
securities of the Company, or (5) other assets; PROVIDED, HOWEVER, if
the Company shall not have made adequate provision to deliver value
pursuant to clause (B) above within thirty (30) days following the first
occurrence of an event triggering the rights to purchase Common Shares
and/or Class A Common Shares described in Section 11(a)(ii) the "Section
11(a)(ii) Trigger Date"), then the Company shall be obligated to
deliver, upon the surrender for exercise of a Right and without
requiring payment of the Purchase Price, shares of Common Stock and/or
Class A Common Stock (to the extent available) and then, if necessary,
cash, which shares and cash have an aggregate value equal to the Spread.
If the Board of Directors of the Company shall determine in good faith
that it is likely that sufficient additional Common Shares and/or Class
A Common Shares could be authorized for issuance upon exercise in full
of the Rights, the thirty (30) day period set forth above may be
extended to the extent necessary, but not more than ninety (90) days
after the Section 11(a)(ii) Trigger Date, in order that the Company may
seek stockholder approval for the authorization of such additional
shares (such period, as it may be extended, the "Substitution Period").
To the extent that the Company determines that some action need be taken
pursuant to the first and/or second sentences of this Section
11(a)(iii), the Company (x) shall provide, subject to Section 7(e)
hereof and the last paragraph of Section 11(a)(ii) hereof, that such
action shall apply uniformly to
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all outstanding Rights, and (y) may suspend the exercisability of the
Rights until the expiration of the Substitution Period in order to seek
any authorization of additional shares and/or to decide the appropriate
form of distribution to be made pursuant to such first sentence and to
determine the value thereof. In the event of any such suspension, the
Company shall make a public announcement, and shall deliver to the
Rights Agent a statement, stating that the exercisability of the Rights
has been temporarily suspended. At such time as the suspension is no
longer in effect, the Company shall make another public announcement,
and deliver to the Rights Agent a statement, so stating. For purposes of
this Section 11(a)(iii), the value of the Common Shares and/or Class A
Common Shares shall be the current per share market price (as determined
pursuant to Section 11(d)(i) hereof) of the Common Shares and/or Class A
Common Shares on the Section 11(a)(ii) Trigger Date and the value of any
common stock equivalent shall be deemed to have the same value as the
Common Shares and/or Class A Common Shares on such date.
(b) In case the Company shall fix a record date for the issuance of
rights, options or warrants to all holders of Series B Preferred Shares and/or
Series C Preferred Shares entitling them (for a period expiring within 45
calendar days after such record date) to subscribe for or purchase Series B
Preferred Shares and/or Series C Preferred Shares (or shares having the same
rights, privileges and preferences as the Series B Preferred Shares and/or
Series C Preferred Shares ("equivalent preferred shares")) or securities
convertible into Series B Preferred Shares and/or Series C Preferred Shares or
equivalent preferred shares at a price per Series B Preferred Shares and/or
Series C Preferred Shares or equivalent preferred share (or having a conversion
price per share, if a security convertible into Series B Preferred Shares and/or
Series C Preferred Shares or equivalent preferred shares) less than the then
current per share market price of the Series B Preferred Shares and/or Series C
Preferred Shares (as defined in Section 11(d)) on such record date, the Purchase
Price to be in effect after such record date shall be adjusted by multiplying
the Purchase Price in effect immediately prior to such record date by a
fraction, the numerator of which shall be the number of Series B Preferred
Shares and/or Series C Preferred Shares outstanding on such record date plus the
number of Series B Preferred Shares and/or Series C Preferred Shares which the
aggregate offering price of the total number of Series B Preferred Shares and/or
Series C Preferred Shares and/or equivalent preferred shares so to be offered
(and/or the aggregate initial conversion price of the convertible securities so
to be offered) would purchase at such current market price and the denominator
of which shall be the number of Series B Preferred Shares and/or Series C
Preferred Shares outstanding on such record date plus the number of additional
Series B Preferred Shares and/or Series C Preferred Shares and/or equivalent
preferred shares to be offered for subscription or purchase (or into which the
convertible securities so to be offered are initially convertible); PROVIDED,
HOWEVER, that in no event shall the consideration to be paid upon the exercise
of one Right be less than the aggregate par value of the shares of capital stock
of the Company issuable upon exercise of one Right. 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. Series B Preferred Shares
and/or Series C Preferred Shares owned by or held for the account of the Company
shall not be deemed outstanding for the purpose of any such computation. Such
adjustment shall be made successively whenever such a record date is fixed; and
in the event that such rights, 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.
(c) In case the Company shall fix a record date for the making of a
distribution to all holders of the Series B Preferred Shares and/or Series C
Preferred Shares (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 a regular
quarterly cash dividend or a
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dividend payable in Series B Preferred Shares and/or Series C Preferred Shares)
or subscription rights or warrants (excluding those referred to in Section 11(b)
hereof), the Purchase Price to be in effect after such record date shall be
determined by multiplying the Purchase Price in effect immediately prior to such
record date by a fraction, the numerator of which shall be the then current per
share market price of the Series B Preferred Shares and/or Series C Preferred
Shares 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) of the portion of the
assets or evidences of indebtedness so to be distributed or of such subscription
rights or warrants applicable to one Series B Preferred Shares and/or Series C
Preferred Shares and the denominator of which shall be such current per share
market price of the Series B Preferred Shares and/or Series C Preferred Shares;
PROVIDED, HOWEVER, that in no event shall the consideration to be paid upon the
exercise of one Right be less than the aggregate par value of the shares of
capital stock of the Company to be issued upon exercise of one Right. Such
adjustments shall be made successively whenever such a record date is fixed; and
in the event that such distribution is not so made, the Purchase Price shall
again be adjusted to be the Purchase Price that would then be in effect if such
record date had not been fixed.
(d) (i) For the purpose of any computation hereunder, the
"current per share market price" of any security (a "Security" for the
purpose of this Section 11(d)(i)) on any date shall be deemed to be the
average of the daily closing prices per share of such Security for the
30 consecutive Trading Days (as such term is hereinafter defined)
immediately prior to such date; PROVIDED, HOWEVER, that in the event
that the current per share market price of the Security is determined
during a period following the announcement by the issuer of such
Security of (A) a dividend or distribution on such Security payable in
shares of such Security or securities convertible into such shares, or
(B) any subdivision, combination or reclassification of such Security
and prior to the expiration of 30 Trading Days after the ex-dividend
date for such dividend or distribution, or the record date for such
subdivision, combination or reclassification, then, and in each such
case, the current per share market price shall be appropriately adjusted
to reflect the current market price per share equivalent of such
Security. 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 Security is 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
Security is listed or admitted to trading or, if the Security is 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 Quotations
System ("NASDAQ") or such other system then in use, or, if on any such
date the Security is 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 Security selected by the Board of Directors
of the Company. The term "Trading Day" shall mean a day on which the
principal national securities exchange on which the Security is listed
or admitted to trading is open for the transaction of business or, if
the Security is not listed or admitted to trading on any national
securities exchange, a Business Day.
(ii) For the purpose of any computation hereunder, the
"current per share market price" of the Preferred Shares shall be
determined in accordance with the method set forth in Section 11(d)(i).
If the Preferred Shares are not publicly traded, the "current per share
market
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price" of the Series B Preferred Shares and/or Series C Preferred Shares
shall be conclusively deemed to be the current per share market price of
the Common Shares and/or Class A Common Shares as determined pursuant to
Section 11(d)(i) (appropriately adjusted to reflect any stock split,
stock dividend or similar transaction occurring after the date hereof),
multiplied by 100. If neither the Common Shares and/or Class A Common
Shares nor the Series B Preferred Shares and/or Series C Preferred
Shares are publicly held or so listed or traded, "current per share
market price" 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.
(e) No adjustment in the Purchase Price shall be required unless
such adjustment would require an increase or decrease of at least 1% in the
Purchase Price; PROVIDED, HOWEVER, that any adjustments which by reason of this
Section 11(e) are not required to be made shall be carried forward and taken
into account in any subsequent adjustment. All calculations under this Section
11 shall be made to the nearest cent or to the nearest one ten-thousandth of a
Series B Preferred Shares and/or Series C Preferred Shares or one ten-thousandth
of any other share or security as the case may be. Notwithstanding the first
sentence of this Section 11(e), any adjustment required by this Section 11 shall
be made no later than three years from the date of the transaction that requires
such adjustment.
(f) If as a result of an adjustment made pursuant to Section 11(a)
hereof, the holder of any Right thereafter exercised shall become entitled to
receive any shares of capital stock of the Company other than Series B Preferred
Shares and/or Series C Preferred Shares, the number of such other shares so
receivable upon exercise of any Right shall thereafter 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 Series B Preferred Shares and/or Series C
Preferred Shares contained in Section 11(a) through (c), inclusive, and the
provisions of Sections 7, 9, 10 and 13 with respect to the Series B Preferred
Shares and/or Series C Preferred Shares 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-hundredth of a
Series B Preferred Shares and/or Series C Preferred Shares 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 Sections 11(b) and (c), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of one one-hundredth of a
Series B Preferred Share and/or Series C Preferred Share (calculated to the
nearest one ten-thousandth of a Series B Preferred Shares and/or Series C
Preferred Shares) obtained by (i) multiplying (x) the number of one
one-hundredth of a share covered by a Right immediately prior to this adjustment
by (y) the Purchase Price in effect immediately prior to such adjustment of the
Purchase Price and (ii) dividing the product so obtained by the Purchase Price
in effect immediately after such adjustment of the Purchase Price.
(i) The Company may elect on or after the date of any adjustment of
the Purchase Price to adjust the number of Rights in substitution for any
adjustment in the number of one one-hundredth of a Series B Preferred Shares
and/or Series C Preferred Shares 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-hundredth of a Series B Preferred Shares
and/or Series C Preferred Shares for which a Right was exercisable immediately
prior to such adjustment. Each Right held of record prior to such adjustment of
the number of Rights shall become that number of Rights (calculated to the
nearest one
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hundred-thousandth) obtained by dividing the Purchase Price in effect
immediately prior to adjustment of the Purchase Price by the Purchase Price in
effect immediately after adjustment of the Purchase Price. The Company shall
make a public announcement of its election to adjust the number of Rights,
indicating the record date for the adjustment, and, if known at the time, the
amount of the adjustment to be made. This record date may be the date on which
the Purchase Price is adjusted or any day thereafter, but, if the Right
Certificates have been distributed, shall be at least 10 days later than the
date of the public announcement. If Right Certificates have been distributed,
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 hereof, the additional Rights to which such holders shall
be entitled as a result of such adjustment, or, at the option of the Company,
shall cause to be distributed to such holders of record in substitution and
replacement for the 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 to be so distributed shall be issued,
executed and countersigned in the manner provided for herein 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-hundredth of a Series B Preferred Share and/or Series C
Preferred Share 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-hundredth of a Series B Preferred Shares and/or Series C
Preferred Shares 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 of the Series B
Preferred Shares and/or Series C Preferred Shares 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 non-assessable Series B Preferred Shares and/or Series C
Preferred Shares at such adjusted Purchase Price.
(l) In any case in which this Section 11 shall require that an
adjustment in the Purchase Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuing to the holder of any Right exercised after such record date of
the Preferred Shares and other capital stock or securities of the Company, if
any, issuable upon such exercise over and above the Preferred Shares 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 (i) combination or subdivision of the Preferred Shares, (ii)
issuance wholly for cash of any Preferred Shares at less than the current market
price, (iii) issuance wholly for cash of Preferred Shares or securities which by
their terms are convertible into or exchangeable for Preferred Shares, (iv)
dividends on Preferred Shares payable in Preferred Shares or (v) issuance of any
rights, options or warrants referred to hereinabove in Section 11(b), hereafter
made by the Company to holders of its Preferred Shares shall not be taxable to
such stockholders.
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(n) 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 Shares and/or Class A Common Shares payable in Common
Shares and/or Class A Common Shares or (ii) effect a subdivision, combination or
consolidation of the Common Shares and/or Class A Common Shares (by
reclassification or otherwise other than by payment of dividends in Common
Shares and/or Class A Common Shares) into a greater or lesser number of Common
Shares and/or Class A Common Shares, then in any such case (i) the number of one
one-hundredth of a Preferred Share purchasable after such event upon proper
exercise of each Right shall be determined by multiplying the number of one
one-hundredth of a Preferred Share so purchasable immediately prior to such
event by a fraction, the numerator of which is the number of Common Shares
outstanding immediately before such event and the denominator of which is the
number of Common Shares and/or Class A Common Shares outstanding immediately
after such event, and (ii) each Common Share and/or Class A Common Shares
outstanding immediately after such event shall have issued with respect to it
that number of Rights which each Common Share and/or Class A Common Shares
outstanding immediately prior to such event had issued with respect to it. The
adjustments provided for in this Section 11(n) shall be made successively
whenever such a dividend is declared or paid or such a subdivision, combination
or consolidation is effected.
Section 12. CERTIFICATE OF ADJUSTMENT. Whenever an adjustment is made as
provided in Sections 11 and 13 hereof, the Company shall promptly (a) prepare a
certificate setting forth such adjustment, and a brief statement of the facts
accounting for such adjustment, (b) file with the Rights Agent and with each
transfer agent for the Common Shares and/or Class A Common Shares or the Series
B Preferred Shares and/or Series C Preferred Shares a copy of such certificate
and (c) mail a brief summary thereof to each holder of a Right Certificate in
accordance with Section 25 hereof. The Rights Agent shall be fully protected in
relying on any such certificate and on any adjustment therein contained.
Section 13. CONSOLIDATION, MERGER OR SALE OR TRANSFER OF ASSETS OR EARNING
POWER.
In the event that, at any time after a Person becomes an Acquiring Person,
directly or indirectly, (i) the Company shall consolidate with, or merge with
and into, any other Person, (ii) any Person shall consolidate with the Company,
or merge with and into the Company and the Company shall be the continuing or
surviving corporation of such merger and, in connection with such merger, all or
part of the Common Shares and/or Class A Common Shares shall be changed into or
exchanged for stock or other securities of any other Person (or the Company) 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 50% or more of
the assets or earning power of the Company and its Subsidiaries (taken as a
whole) to any other Person other than the Company or one or more of its
wholly-owned Subsidiaries, then, and in each such case, proper provision shall
be made so that (A) each holder of a Right (except as otherwise provided herein)
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-hundredth of a Preferred Share for which a Right is then exercisable, in
accordance with the terms of this Agreement and in lieu of Preferred Shares,
such number of Common Shares and/or Class A Common Shares of such other Person
(including the Company as successor thereto or as the surviving corporation) as
shall equal the result obtained by (x) multiplying the then current Purchase
Price by the number of one one-hundredth of a Preferred Share for which a Right
is then exercisable and dividing that product by (y) 50% of the then current per
share market price of the Common Shares and/or Class A Common Shares of such
other Person (determined pursuant to Section 11(d) hereof) on the date of
consummation of such consolidation, merger, sale or transfer; (B) the issuer of
such Common Shares and/or Class A Common Shares shall thereafter be liable for,
and shall assume, by virtue of such
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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 issuer; and (D) such issuer shall take such steps
(including, but not limited to, the reservation of a sufficient number of its
Common Shares and/or Class A Common Shares in accordance with Section 9 hereof)
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 the Common Shares and/or Class A Common Shares thereafter
deliverable upon the exercise of the Rights. The Company covenants and agrees
that it shall not consummate any such consolidation, merger, sale or transfer
unless prior thereto the Company and such issuer shall have executed and
delivered to the Rights Agent a supplemental agreement so providing. The Company
shall not enter into any transaction of the kind referred to in this Section 13
if at the time of such transaction there are any rights, warrants, instruments
or securities outstanding or any agreements or arrangements which, as a result
of the consummation of such transaction, would eliminate or substantially
diminish the benefits intended to be afforded by the Rights. The provisions of
this Section 13 shall similarly apply to successive mergers or consolidations or
sales or other transfers. For purposes hereof, the "earning power" of the
Company and its Subsidiaries shall be determined in good faith by the Company's
Board of Directors on the basis of the operating earnings of each business
operated by the Company and its Subsidiaries during the three fiscal years
preceding the date of such determination (or, in the case of any business not
operated by the Company or any Subsidiary during three full fiscal years
preceding such date, during the period such business was operated by the Company
or any Subsidiary).
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. If on any such date no such market maker is making a
market in the Rights, the fair value of the Rights on such date as determined in
good faith by the Board of Directors of the Company shall be used.
(b) The Company shall not be required to issue fractions of
Preferred Shares (other than fractions which are integral multiples of one
one-hundredth of a Preferred Share) upon exercise of the Rights or to distribute
certificates which evidence fractional Preferred Shares (other than fractions
which are integral multiples of one one-hundredth of a Preferred Share).
Fractions of Preferred Shares in integral multiples of one one-hundredth of a
Preferred Share may, at the election of the Company, be evidenced by depositary
receipts, pursuant to an appropriate agreement between the Company and a
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depositary selected by it; PROVIDED, that such agreement shall provide that the
holders of such depositary receipts shall have all the rights, privileges and
preferences to which they are entitled as beneficial owners of the Preferred
Shares represented by such depositary receipts. In lieu of fractional Preferred
Shares that are not integral multiples of one one-hundredth of a Preferred
Share, the Company shall pay to each registered holder of Right Certificates at
the time such Rights are exercised as herein provided an amount in cash equal to
the same fraction of the current market value of one Preferred Share as the
fraction of one Preferred Share that such holder would otherwise receive upon
the exercise of the aggregate number of rights exercised by such holder. For the
purposes of this Section 14(b), the current market value of a Preferred Share
shall be the closing price of a Preferred Share (as determined pursuant to the
second sentence of Section 11(d)(i) hereof) for the Trading Day immediately
prior to the date of such exercise.
(c) The holder of a Right by the acceptance of the Right expressly
waives any right to receive fractional Rights or fractional shares upon exercise
of a Right (except as provided above).
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 Section 18
hereof, are vested in the respective registered holders of the Right
Certificates (and, prior to the Distribution Date, the registered holders of the
Common Shares and/or Class A Common Shares); and any registered holder of any
Right Certificate (or, prior to the Distribution Date, of the Common Shares
and/or Class A Common Shares) may, 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 Shares and/or Class A Common Shares), on 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 this Agreement. Without limiting the
foregoing or any remedies available to the holders of Rights, it is specifically
acknowledged that the holders of Rights would not have an adequate remedy at law
for any breach of this Agreement and 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 Distribution Date, the Rights will be transferable
only in connection with the transfer of the Common Shares and/or Class A Common
Shares;
(b) after the Distribution Date, the Right Certificates are
transferable only on the registry books maintained by the Rights Agent if
surrendered at the principal office of the Rights Agent, duly endorsed or
accompanied by a proper instrument of transfer with a completed form of
certification; and
(c) the Company and the Rights Agent may deem and treat the person
in whose name the Right Certificate (or, prior to the Distribution Date, the
associated Common Shares certificate and/or Class A Common Shares certificate)
is registered as the absolute owner thereof and of the Rights evidenced thereby
(notwithstanding any notations of ownership or writing on the Right Certificates
or the associated Common Shares 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.
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
-18-
the holder of the Preferred Shares 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 hereof),
or to receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Right Certificate shall have been exercised in
accordance with the provisions hereof.
Section 18. CONCERNING THE RIGHTS AGENT. 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, or expense, incurred without
gross negligence, bad faith or willful misconduct on the part of the Rights
Agent, for anything done or omitted by the Rights Agent in connection with the
acceptance and administration of this Agreement, including the costs and
expenses of defending against any claim or liability in connection therewith.
The Rights Agent shall be protected and shall incur no liability for or in
respect of any action taken, suffered or omitted by it in connection with its
administration of this Agreement in reliance upon any 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.
Section 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF RIGHTS AGENT. Any
corporation into which the Rights Agent or any successor Rights Agent may be
merged or with which it may be consolidated, or any corporation resulting from
any merger or consolidation to which the Rights Agent or any successor Rights
Agent shall be a party, or any corporation succeeding to the corporate trust
business of the Rights Agent or any successor Rights Agent, shall be the
successor to the Rights Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto,
provided that such corporation would be eligible for appointment as a successor
Rights Agent under the provisions of Section 21 hereof. In case at the time such
successor Rights Agent shall succeed to the agency created by this Agreement,
any of the 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.
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.
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Section 20. DUTIES OF RIGHTS AGENT. The Rights Agent undertakes the duties and
obligations expressly set forth in this Agreement and no implied duties or
obligations shall be read into this Agreement against the Rights Agent. The
Rights Agent shall perform those duties and obligations upon the following terms
and conditions, by all of which the Company and the holders of Right
Certificates, by their acceptance thereof, shall be bound:
(a) The Rights Agent may consult with legal counsel (who may be
legal counsel for the Company), and the opinion of such counsel shall be full
and complete authorization and protection to the Rights Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion.
(b) Whenever in the performance of its duties under this Agreement
the Rights Agent shall deem it necessary or desirable that any fact or matter be
proved or established by the Company prior to taking or suffering any action
hereunder, such fact or matter (unless other evidence in respect thereof be
herein specifically prescribed) may be deemed to be conclusively proved and
established by a certificate signed by any one of the Chairman of the Board, the
President, a Vice President or the Secretary of the Company and delivered to the
Rights Agent; and such certificate shall be full authorization to the Rights
Agent for any action taken or suffered in good faith by it under the provisions
of this Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder only for its own
gross negligence, bad faith or willful misconduct.
(d) The Rights Agent shall not be liable for or by reason of any of
the statements of fact or recitals contained in this Agreement or in the Right
Certificates (except as to 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 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 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 responsible for any adjustment required under the provisions of
Sections 11 or 13 hereof or responsible for the manner, method or amount of any
such adjustment or the ascertaining of the existence of facts that would require
any such adjustment (except with respect to the exercise of Rights evidenced by
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 so issued, be validly authorized and issued, fully
paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge
and deliver or cause to be performed, executed, acknowledged end delivered all
such further and other acts, instruments and assurances as may reasonably be
required by the Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from any
one of the Chairman of the Board, the President, a Vice President or the
Secretary of the Company, and to apply to such officers for advice or
instructions in connection with its duties, and it shall not be liable for any
action taken or suffered to be taken by it in good faith in accordance with
instructions of any such officer.
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(h) The Rights Agent and any stockholder, director, officer or
employee of the Rights Agent may buy, sell or deal in any of the Rights or other
securities of the Company or become pecuniarily interested in any transaction in
which the Company may be interested, or contract with or lend money to the
Company or otherwise act as fully and freely as though it were not Rights Agent
under this Agreement. Nothing herein shall preclude the Rights Agent from acting
in any other capacity for the Company or for any other legal entity.
(i) The Rights Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either itself or by or
through its attorneys or agents, and the Rights Agent shall not be answerable or
accountable for any act, default, neglect or misconduct of any such attorneys or
agents or for any loss to the Company resulting from any such act, default,
neglect or misconduct, provided reasonable care was exercised in the selection
and continued employment thereof.
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 Shares and/or Class A Common Shares and the Preferred Stock by registered
or certified mail, and to the holders of the Right Certificates by first-class
mail. 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 Shares
and/or Class A Common Shares and the Preferred 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, the Company shall appoint a successor to the Rights Agent. If the
Company shall fail to make such appointment within a period of 30 days after
giving notice of such removal or after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Rights Agent or by
the holder of a Right Certificate (who shall, with such notice, submit his Right
Certificate for inspection by the Company), then the registered holder of any
Right Certificate may apply to any court of competent jurisdiction for the
appointment of a new Rights Agent. Any successor Rights Agent, whether appointed
by the Company or by such a court, shall be a corporation organized and doing
business under the laws of the United States or of any state of the United
States, in good standing, having an office in the United States which is
authorized to exercise corporate trust powers and is subject to supervision or
examination by federal or state authority and which has at the time of its
appointment as Rights Agent a combined capital and surplus of at least $100
million. After appointment, the successor Rights Agent shall be vested with the
same powers, rights, duties and responsibilities as if it had been originally
named as Rights Agent without further act or deed; but the predecessor Rights
Agent shall deliver and transfer to the successor Rights Agent any property at
the time held by it hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Not later than the effective
date of any such appointment the Company shall file notice thereof in writing
with the predecessor Rights Agent and each transfer agent of the Common Shares
and/or Class A Common Shares and the Preferred 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 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.
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Section 23. REDEMPTION.
(a) The Board of Directors of the Company may, at its option, at any
time prior to such time as any Person becomes an Acquiring Person, redeem all
but not less than all the then outstanding Rights at a redemption price of $0.01
per Right, payable in cash or the Company's Common Shares and/or Class A Common
Shares (rounded down to the nearest whole share) and appropriately adjusted to
reflect any stock split, stock dividend or similar transaction occurring after
the date hereof (such redemption price being hereinafter referred to as the
"Redemption Price"). The redemption of the Rights by the Board of Directors may
be made effective at such time, on such basis and subject to such conditions as
the Board of Directors in its sole discretion may establish.
(b) Immediately upon the action of the Board of Directors of the
Company ordering the redemption of the Rights pursuant to paragraph (a) of this
Section 23, and without any further action and without any notice, the right to
exercise the Rights will terminate and the only right thereafter of the holders
of Rights shall be to receive the Redemption Price. The Company shall promptly
give public notice of any such redemption; PROVIDED, HOWEVER, that the failure
to give, or any defect in, any such notice shall not affect the validity of such
redemption. Within 10 days after such action of the Board of Directors ordering
the redemption of the Rights pursuant to paragraph (a), the Company shall mail a
notice of redemption to all the holders of the then outstanding Rights 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 Shares and/or Class A Common Shares. Any notice which is mailed in
the manner herein provided shall be deemed given, whether or not the holder
receives the notice. If the payment of the Redemption Price is not included with
such notice, each such notice 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 or in
Section 24 hereof, other than in connection with the purchase of Common Shares
and/or Class A Common Shares prior to the Distribution Date.
Section 24. EXCHANGE.
(a) The Board of Directors of the Company may, at its option, at any
time after any Person becomes an Acquiring Person, exchange all or part of the
then outstanding and exercisable Rights (which shall not include Rights that
have become void pursuant to the provisions of Section 11(a)(ii) hereof) for
Common Shares and/or Class A Common Shares at an exchange ratio of one Common
Share and/or Class A Common Shares per Right, appropriately adjusted to reflect
any stock split, stock dividend or similar transaction occurring after the date
hereof (such exchange ratio being hereinafter referred to as the "Exchange
Ratio"). Notwithstanding the foregoing, the Board of Directors shall not be
empowered to effect such exchange at any time after any Person (other than the
Company, any Subsidiary of the Company, any employee benefit plan of the Company
or any such Subsidiary, or any entity holding Common Shares and/or Class A
Common Shares for or pursuant to the terms of any such plan), together with all
Affiliates and Associates of such Person, becomes the Beneficial Owner of a
sixty percent (60%) of the Common Shares and/or Class A Common Shares then
outstanding.
(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 a holder
of such Rights shall be to receive that number of Common Shares and/or Class A
Common Shares
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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; 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 Shares and/or Class A
Common Shares 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 void pursuant to the provisions of Section 11(a)(ii) hereof)
held by each holder of Rights.
(c) In any exchange pursuant to this Section 24, the Company, at its
option, may substitute Preferred Shares or common stock equivalents for Common
Shares and/or Class A Common Shares exchangeable for Rights, at the initial rate
of one one-hundredth of a Preferred Share (or an appropriate number of common
stock equivalents) for each Common Share and/or Class A Common Shares, as
appropriately adjusted to reflect adjustments in the voting rights of the
Preferred Shares pursuant to the terms thereof, so that the fraction of a
Preferred Share delivered in lieu of each Common Share and/or Class A Common
Shares shall have the same voting rights as one Common Share and/or Class A
Common Shares.
(d) In the event that there shall not be sufficient Common Shares
and/or Class A Common Shares, Preferred Shares or common stock equivalents
authorized by the Company's certificate of incorporation and not outstanding or
subscribed for, or reserved or otherwise committed for issuance for purposes
other than upon exercise of Rights, 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 Common Shares and/or Class A
Common Shares, Preferred Shares or common stock equivalents for issuance upon
exchange of the Rights.
(e) The Company shall not be required to issue fractions of Common
Shares and/or Class A Common Shares or to distribute certificates which evidence
fractional Common Shares and/or Class A Common Shares. In lieu of such
fractional Common Shares, the Company shall pay to the registered holders of the
Right Certificates with regard to which such fractional Common Shares and/or
Class A Common Shares would otherwise be issuable an amount in cash equal to the
same fraction of the current per share market value of a whole Common Share
and/or Class A Common Shares. For the purposes of this paragraph (e), the
current per share market value of a whole Common Share and/or Class A Common
Shares shall be the closing price of a Common Share and/or Class A Common Shares
(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.
(a) In case the Company shall after the Distribution Date propose
(i) to pay any dividend payable in stock of any class to the holders of its
Preferred Shares or to make any other distribution to the holders of its
Preferred Shares (other than a regular quarterly cash dividend), (ii) to offer
to the holders of its Preferred Shares rights or warrants to subscribe for or to
purchase any additional Preferred Shares or shares of stock of any class or any
other securities, rights or options, (iii) to effect any reclassification of its
Preferred Shares (other than a reclassification involving only the subdivision
of outstanding Preferred Shares), (iv) 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,
-23-
of 50% or more of the assets or earning power of the Company and its
Subsidiaries (taken as a whole) to, any other Person, (v) to effect the
liquidation, dissolution or winding up of the Company, or (vi) to declare or pay
any dividend on the Common Shares and/or Class A Common Shares payable in Common
Shares and/or Class A Common Shares or to effect a subdivision, combination or
consolidation of the Common Shares and/or Class A Common Shares (by
reclassification or otherwise than by payment of dividends in Common Shares
and/or Class A Common Shares), then, in each such case, the Company shall give
to each holder of a Right Certificate, in accordance with Section 26 hereof, a
notice of such proposed action, which shall specify the record date for the
purposes of such stock dividend, or distribution of rights or warrants, or the
date on which such reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution, or winding up is to take place and the date of
participation therein by the holders of the Common Shares and/or Class A Common
Shares and/or Preferred Shares, if any such date is to be fixed, and such notice
shall be so given in the case of any action covered by clause (i) or (ii) above
at least 10 days prior to the record date for determining holders of the
Preferred Shares for purposes of such action, and in the case of any such other
action, at least 10 days prior to the date of the taking of such proposed action
or the date of participation therein by the holders of the Common Shares and/or
Class A Common Shares and/or Preferred Shares, whichever shall be the earlier.
(b) In case any event set forth in Section 11(a)(ii) hereof shall
occur, then the Company shall as soon as practicable thereafter give to each
holder of a Right Certificate, in accordance with Section 26 hereof, a notice of
the occurrence of such event, which notice shall describe such event and the
consequences of such event to holders of Rights under Section 11(a)(ii) hereof.
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:
Heico Corporation
3000 Taft Street
Hollywood, Florida 33021
Attention: Victor H. Mendelson, General Counsel
Copy to:
Edwards & Angell, LLP
350 East Las Olas Boulevard
Suite 1150
Fort Lauderdale, Florida 33301
Attention: Charles J. Duffy, III, Esquire
-24-
Subject to the provisions of Section 21 hereof, 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:
SunTrust Bank
Corporate Trust
777 Brickell Avenue
Miami, Florida 33131
Attention: Holly Lee Jeske
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 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. The Company may from time to time, 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 to
cure any ambiguity, to correct or supplement any provision contained herein
which may be defective or inconsistent with any other provisions herein, or to
make any change to or delete any provision hereof or to adopt any other
provisions with respect to the Rights which the Company may deem necessary or
desirable; PROVIDED, HOWEVER, that from and after such time as any Person
becomes an Acquiring Person, this Agreement shall not be amended or supplemented
in any manner which would adversely affect the interests of the holders of
Rights (other than an Acquiring Person and its Affiliates and Associates). Any
supplement or amendment authorized by this Section 27 will be evidenced by a
writing signed by the Company and the Rights Agent.
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 Common Shares and/or Class A Common Shares) 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 Common Shares and/or Class A Common Shares).
Section 30. SEVERABILITY. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction or other authority
to be invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
Section 31. 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
Florida 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.
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Section 32. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
Section 33. DESCRIPTIVE HEADINGS. Descriptive headings of the several Sections
of this Agreement are inserted for convenience only and shall not control or
affect the meaning or construction of any of the provisions hereof.
Section 34. ADMINISTRATION. The Board of Directors of the Company shall have the
exclusive power and authority to administer and interpret the provisions of this
Agreement and to exercise all rights and powers specifically granted to the
Board of Directors or the Company or as may be necessary or advisable in the
administration of this Agreement. All such actions, calculations, determinations
and interpretations which are done or made by the Board of Directors in good
faith shall be final, conclusive and binding on the Company, the Rights Agent,
the holders of the Rights and all other parties and shall not subject the Board
of Directors to any liability to the holders of the Rights.
IN WITNESS WHEREOF, the parties hereto have caused this Rights Agreement to be
duly executed and their respective corporate seals to be hereunder affixed and
attested, all as of the day and year first above written.
HEICO CORPORATION
By: /s/ Thomas S. Irwin
Title: Treasurer
SUNTRUST BANK
By: /s/ Holly Lee Jeske
Title: Vice President
EXHIBIT A
ARTICLES OF AMENDMENT
OF
HEICO CORPORATION
The undersigned, being a Director HEICO Corporation, a Florida
corporation (the "Corporation"), does hereby file these Articles of Amendment to
the Corporation's Articles of Incorporation, pursuant to Sections 607.1006 and
607.0602 of the Florida Business Corporation Act.
1. The name of the Corporation is HEICO Corporation.
2. Article III of the Corporation's Articles of Incorporation shall be
amended by deleting current Section (f) and adding a new Section (f) and (g)
thereto, to read as follows:
"(f) SERIES B JUNIOR PARTICIPATING PREFERRED STOCK
(1) Designation and Amount. The shares of such series shall be
designated as "Series B Junior Participating Preferred Stock" (the "Series B
Preferred Stock") and the number of shares constituting such series shall be
300,000.
(2) Dividends and Distributions.
(A) Subject to the provisions for adjustment hereinafter set
forth, the holders of shares of Series B Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds legally
available for the purpose, (i) cash dividends in an amount per share (rounded to
the nearest cent) equal to 100 times the aggregate per share amount of all cash
dividends declared or paid on the Common Stock of the Corporation and (ii) a
preferential cash dividend (the "Series B Preferential Cash Dividends"), if any,
on the first day of February, May, August and November of each year (each a
"Series B Quarterly Dividend Payment Date"), commencing on the first Series B
Quarterly Dividend Payment Date after the first issuance of a share or fraction
of a share of Series B Preferred Stock, in an amount equal to $.75 per share of
Series B Preferred Stock less the per share amount of all cash dividends
declared on the Series B Preferred Stock pursuant to clause (i)of this sentence
since the immediately preceding Series B Quarterly Dividend Payment Date or,
with respect to the first Series B Quarterly Dividend Payment Date, since the
first issuance of any share or fraction of a share of Series B Preferred Stock.
In the event the Corporation shall, at any time after the issuance of any share
or fraction of a share of Series B Preferred Stock, make any distribution on the
shares of Common Stock of the Corporation, whether by way of a dividend or a
reclassification of stock, a recapitalization, reorganization or partial
liquidation of the Corporation or otherwise, which is payable in cash or any
debt security, debt instrument, real or personal property or any other property
(other than cash dividends subject to the immediately preceding sentence, a
distribution of shares of Common Stock or other capital stock of the Corporation
or a distribution of rights or warrants to acquire any such share, including any
debt security convertible into or exchangeable for any such share, at a price
less than the Fair Market Value (as defined in Section (f)(7)(D) of this Article
III) of such share), then and in each such event the Corporation shall
simultaneously pay on each then outstanding share of Series B Preferred Stock of
the Corporation a distribution, in like kind, of 100 times such distribution
paid on a share of Common Stock (subject to the provisions for adjustment
hereinafter set forth). The dividends and distributions on the Series B
Preferred Stock to which holders thereof are entitled pursuant to clause (i)
A-1
of the first sentence of this paragraph and pursuant to the second sentence of
this paragraph are hereinafter referred to as "Series B Participating Dividends"
and the multiple of such cash and non-cash dividends on the Common Stock
applicable to the determination of the Series B Participating Dividends, which
shall be 100 initially but shall be adjusted from time to time as hereinafter
provided, is hereinafter referred to as the "Series B Dividend Multiple". In the
event the Corporation shall at any time after November 2, 2003 declare or pay
any dividend or make any distribution on Common Stock payable in shares of
Common Stock, or effect a subdivision or split or a combination, consolidation
or reverse split of the outstanding shares of Common Stock into a greater or
lesser number of shares of Common Stock, then in each such case the Series B
Dividend Multiple thereafter applicable to the determination of the amount of
Series B Participating Dividends which holders of shares of Series B Preferred
Stock shall be entitled to receive shall be the Series B Dividend Multiple
applicable immediately prior to such event multiplied by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare each Series B
Participating Dividend at the same time it declares any cash or non-cash
dividend or distribution on the Common Stock in respect of which a Series B
Participating Dividend is required to be paid. No cash or non-cash dividend or
distribution on the Common Stock in respect of which a Series B Participating
Dividend is required to be paid shall be paid or set aside for payment on the
Common Stock unless a Series B Participating Dividend in respect of such
dividend or distribution on the Common Stock shall be simultaneously paid, or
set aside for payment, on the Series B Preferred Stock.
(C) Series B Preferential Cash Dividends shall begin to
accrue on outstanding shares of Series B Preferred Stock from the Series B
Quarterly Dividend Payment Date next preceding the date of issuance of any
shares of Series B Preferred Stock. Accrued but unpaid Series B Preferential
Cash Dividends shall be cumulative but shall not bear interest. Series B
Preferential Cash Dividends paid on the shares of Series B Preferred Stock in an
amount less than the total amount of such dividends at the time accrued and
payable on such shares shall be allocated pro rata on a share-by-share basis
among all such shares at the time outstanding.
(3) Voting Rights. The holders of shares of Series B Preferred Stock
shall have the following voting rights:
(A) Subject to the provisions for adjustment hereinafter set
forth, each share of Series B Preferred Stock shall entitle the holder thereof
to 100 votes on all matters submitted to a vote of the shareholders of the
Corporation. The number of votes which a holder of a share of Series B Preferred
Stock is entitled to cast, as the same may be adjusted from time to time as
hereinafter provided, is hereinafter referred to as the "Series B Vote
Multiple". In the event the Corporation shall at any time after November 2, 2003
declare or pay any dividend on Common Stock payable in shares of Common Stock,
or effect a subdivision or split or a combination, consolidation or reverse
split of the outstanding shares of Common Stock into a greater or lesser number
of shares of Common Stock, then in each such case the Series B Vote Multiple
thereafter applicable to the determination of the number of votes per share to
which holders of shares of Series B Preferred Stock shall be entitled after such
event shall be the Series B Vote Multiple immediately prior to such event
multiplied by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding immediately
prior to such event.
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(B) Except as otherwise provided in these Articles of
Incorporation or the Bylaws of the Corporation, the holders of shares of Series
B Preferred Stock and Series C Preferred Stock and the holders of shares of
Common Stock and Class A Common Stock shall vote together as a single voting
group on all matters submitted to a vote of shareholders of the Corporation.
(C) Unless otherwise provided in these Articles of
Incorporation, in the event that any preferential cash dividend to which the
holders of any currently existing or future series of the Series B Preferred
Stock are entitled (collectively, the "Series B Preferred Cash Dividends") has
accrued for four or more quarterly dividend periods, whether consecutive or not,
and shall not have been declared and paid (or a sum sufficient for the payment
thereof has been set aside) in full, the holders of record of such series of
Preferred Stock, other than any series in respect of which such right is
expressly withheld by these Articles of Incorporation (such holders existing
from time to time being hereinafter referred to as the "Unpaid Series B
Holders"), acting as a single voting group, shall have the right, at the next
meeting of shareholders called for the election of Directors, to elect one
member to the Board of Directors, which Director (hereinafter, the "Series B
Preferred Director") shall be in addition to the number of Directors required by
the Bylaws of the Corporation prior to such event, to serve until the next
annual meeting of shareholders and until their successors are elected and
qualified or their earlier resignation, removal or incapacity or until such
earlier time as all accrued and unpaid Series B Preferred Cash Dividends shall
have been paid (or a sum sufficient for the payment thereof has been set aside)
in full. If at any annual meeting of shareholders at which the term of a Series
B Preferred Director is fixed to expire there are accrued Series B Preferred
Cash Dividends which have not been paid (or a sum sufficient for payment thereof
has not been set aside) in full, the Unpaid Series B Holders shall have the
right to elect a Series B Preferred Director to the vacant Directorship
resulting from the expiration of the term of such Series B Preferred Director in
the manner provided in the immediately preceding sentence until all accrued and
unpaid Series B Preferred Cash Dividends shall have been paid (or a sum
sufficient for payment thereof has been set aside) in full; provided, however,
that at no time shall more than one Series B Preferred Director be a member of
the Board of Directors. The Series B Preferred Director may be removed, with or
without cause, by the Unpaid Series B Holders. Vacancies in such Directorships
(whether caused by death, resignation, removal or otherwise) may be filled (if
any accrued Series B Preferred Cash Dividends remain unpaid or a sum sufficient
for payment thereof has not been set aside) only by the Unpaid Series B Holders
in the manner permitted by law; provided, however, that any such action by the
Unpaid Series B Holders shall be taken at a meeting of shareholders and shall
not be taken by written consent; provided further, however, that by a vote of a
majority of the Board of Directors in office other than the Series B Preferred
Director, the Series B Preferred Director may be removed immediately after all
accrued and unpaid Series B Preferred Cash Dividends shall have been paid (or a
sum sufficient for the payment thereof has been set aside) in full.
(D) Except as otherwise provided in these Articles of
Incorporation or the Bylaws of the Corporation, holders of Series B Preferred
Stock shall have no special voting rights and their consent shall not be
required (except to the extent they are entitled to vote with holders of Common
Stock as set forth herein) for the taking of any corporate action.
(4) Certain Restrictions.
(A) Whenever Series B Preferential Cash Dividends or Series
B Participating Dividends are in arrears or the Corporation shall be in default
of payment thereof, thereafter and until all accrued and unpaid Series B
Preferential Cash Dividends and Series B Participating Dividends, whether or not
declared, on shares of Series B Preferred Stock outstanding shall have been paid
(or a sum sufficient for payment thereof has been set aside) in full, and in
addition to any and all other rights which
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any holder of shares of Series B Preferred Stock may have in such circumstances,
the Corporation shall not
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire for
consideration, any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series B Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity as to
dividends with the Series B Preferred Stock, unless dividends
are paid ratably on the Series B Preferred Stock and all such
parity stock on which dividends are payable or in arrears in
proportion to the total amounts to which the holders of all such
shares are then entitled if the full dividends accrued thereon
were to be paid;
(iii) except as permitted by subparagraph (iv) of this
paragraph (4)(A), redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either as
to dividends or upon liquidation, dissolution or winding up)
with the Series B Preferred Stock, provided that the Corporation
may at any time redeem, purchase or otherwise acquire shares of
any such parity stock in exchange for shares of any stock of the
Corporation ranking junior (both as to dividends and upon
liquidation, dissolution or winding up) to the Series B
Preferred Stock; or
(iv) purchase or otherwise acquire for consideration
any shares of Series B Preferred Stock, or any shares of stock
ranking on a parity with the Series B Preferred Stock (either as
to dividends or upon liquidation, dissolution or winding up),
except in accordance with a purchase offer made to all holders
of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other
relative rights and preferences of the respective series and
classes, shall determine in good faith will result in fair and
equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any Subsidiary (as
hereinafter defined) of the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the Corporation unless the Corporation
could, under paragraph (A) of this Section 4, purchase or otherwise acquire such
shares at such time and in such manner. A "Subsidiary" of the Corporation shall
mean any corporation or other entity of which securities or other ownership
interests having ordinary voting power sufficient to elect a majority of the
Board of Directors or other persons performing similar functions are
beneficially owned, directly or indirectly, by the Corporation or by any
corporation or other entity that is otherwise controlled by the Corporation.
(C) The Corporation shall not issue any shares of Series B
Preferred Stock except upon exercise of Rights (the "Series B Rights") issued
pursuant to that certain Rights Agreement dated as of November 2, 2003 between
the Corporation and SunTrust Bank, as rights agent, a copy of which is on file
with the Secretary of the Corporation at its principal executive office and
shall be made available to shareholders of record without charge upon written
request therefor addressed to said Secretary. Notwithstanding the foregoing
sentence, nothing contained in the provisions hereof shall prohibit or restrict
the Corporation from issuing for any purpose any series of Preferred Stock with
rights and privileges similar to, different from, or greater than, those of the
Series B Preferred Stock.
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(5) Reacquired Shares. Any shares of Series B Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and canceled promptly after the acquisition thereof. All such
shares upon their retirement and cancellation shall become authorized but
unissued shares of preferred stock, without designation as to series, and such
shares may be reissued as part of a new series of preferred stock to be created
by resolution or resolutions of the Board of Directors.
(6) Liquidation, Dissolution or Winding Up. Upon any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (A) to the holders of shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or winding up) to the
Series B Preferred Stock unless the holders of shares of Series B Preferred
Stock shall have received, subject to adjustment as hereinafter provided, (i)
$45 per one-hundredth share plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of such payment,
or (ii) if greater than the amount specified in clause (A)(i) of this sentence,
an amount equal to 100 times the aggregate amount to be distributed per share to
holders of Common Stock, as the same may be adjusted as hereinafter provided,
and (B) to the holders of stock ranking on a parity upon liquidation,
dissolution or winding up with the Series B Preferred Stock, unless
simultaneously therewith distributions are made ratably on the Series B
Preferred Stock and all other shares of such parity stock in proportion to the
total amounts to which the holders of shares of Series B Preferred Stock are
entitled under clause (A)(i) of this sentence and to which the holders of such
parity shares are entitled, in each case upon such liquidation, dissolution or
winding up. The amount to which holders of Series B Preferred Stock may be
entitled upon liquidation, dissolution or winding up of the Corporation pursuant
to clause (A) of the foregoing sentence is hereinafter referred to as the
"Series B Participating Liquidation Amount" and the multiple of the amount to be
distributed to holders of shares of Common Stock upon the liquidation,
dissolution or winding up of the Corporation applicable pursuant to said clause
to the determination of the Series B Participating Liquidation Amount, as said
multiple may be adjusted from time to time as hereinafter provided, is
hereinafter referred to as the "Series B Liquidation Multiple". In the event the
Corporation shall at any time after November 2, 2003 declare or pay any dividend
on Common Stock payable in shares of Common Stock, or effect a subdivision or
split or a combination, consolidation or reverse split of the outstanding shares
of Common Stock into a greater or lesser number of shares of Common Stock, then
in each such case the Series B Liquidation Multiple thereafter applicable to the
determination of the Series B Participating Liquidation Amount to which holders
of Series B Preferred Stock shall be entitled after such event shall be the
Series B Liquidation Multiple applicable immediately prior to such event
multiplied by a fraction the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding immediately
prior to such event.
(7) Certain Reclassifications and Other Events.
(A) In the event that holders of shares of Common Stock of
the Corporation receive after November 2, 2003 in respect of their shares of
Common Stock any share of capital stock of the Corporation (other than any share
of Common Stock of the Corporation), whether by way of reclassification,
recapitalization, reorganization, dividend or other distribution or otherwise (a
"Common Stock Transaction"), then and in each such event the dividend rights,
voting rights and rights upon the liquidation, dissolution or winding up of the
Corporation of the shares of Series B Preferred Stock shall be adjusted so that
after such event the holders of Series B Preferred Stock shall be entitled, in
respect of each share of Series B Preferred Stock held, in addition to such
rights in respect thereof to which such holder was entitled immediately prior to
such adjustment, to (i) such additional dividends as equal the
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Series B Dividend Multiple in effect immediately prior to such Common Stock
Transaction multiplied by the additional dividends which the holder of a share
of Common Stock shall be entitled to receive by virtue of the receipt in the
Common Stock Transaction of such capital stock, (ii) such additional voting
rights as equal the Series B Vote Multiple in effect immediately prior to such
Common Stock Transaction multiplied by the additional voting rights which the
holder of a share of Common Stock shall be entitled to receive by virtue of the
receipt in the Common Stock Transaction of such capital stock and (iii) such
additional distributions upon liquidation, dissolution or winding up of the
Corporation as equal the Series B Liquidation Multiple in effect immediately
prior to such Common Stock Transaction multiplied by the additional amount which
the holder of a share of Common Stock shall be entitled to receive upon
liquidation, dissolution or winding up of the Corporation by virtue of the
receipt in the Common Stock Transaction of such capital stock, as the case may
be, all as provided by the terms of such capital stock.
(B) In the event that holders of shares of Common Stock of
the Corporation receive after November 2, 2003 in respect of their shares of
Common Stock any right or warrant to purchase Common Stock (including as such a
right, for all purposes of this paragraph, any security convertible into or
exchangeable for Common Stock) at a purchase price per share less than the Fair
Market Value (as hereinafter defined) of a share of Common Stock on the date of
issuance of such right or warrant, then and in each such event the dividend
rights, voting rights and rights upon the liquidation, dissolution or winding up
of the Corporation of the shares of Series B Preferred Stock shall each be
adjusted so that after such event the Series B Dividend Multiple, the Series B
Vote Multiple and the Series B Liquidation Multiple shall each be the product of
the Series B Dividend Multiple, the Series B Vote Multiple and the Series B
Liquidation Multiple, as the case may be, in effect immediately prior to such
event multiplied by a fraction the numerator of which shall be the number of
shares of Common Stock outstanding immediately before such issuance of rights or
warrants plus the maximum number of shares of Common Stock which could be
acquired upon exercise in full of all such rights or warrants and the
denominator of which shall be the number of shares of Common Stock outstanding
immediately before such issuance of rights or warrants plus the number of shares
of Common Stock which could be purchased, at the Fair Market Value of the Common
Stock at the time of such issuance, by the maximum aggregate consideration
payable upon exercise in full of all such rights or warrants.
(C) In the event that holders of shares of Common Stock of
the Corporation receive after November 2, 2003 in respect of their shares of
Common Stock any right or warrant to purchase capital stock of the Corporation
(other than shares of Common Stock), including as such a right, for all purposes
of this paragraph, any security convertible into or exchangeable for capital
stock of the Corporation (other than Common Stock), at a purchase price per
share less than the Fair Market Value of such shares of capital stock on the
date of issuance of such right or warrant, then and in each such event the
dividend rights, voting rights and rights upon liquidation, dissolution or
winding up of the Corporation of the shares of Series B Preferred Stock shall
each be adjusted so that after such event each holder of a share of Series B
Preferred Stock shall be entitled, in respect of each share of Series B
Preferred Stock held, in addition to such rights in respect thereof to which
such holder was entitled immediately prior to such event, to receive (i) such
additional dividends as equal the Series B Dividend Multiple in effect
immediately prior to such event multiplied, first, by the additional dividends
to which the holder of a share of Common Stock shall be entitled upon exercise
of such right or warrant by virtue of the capital stock which could be acquired
upon such exercise and multiplied again by the Discount Fraction (as hereinafter
defined) and (ii) such additional voting rights as equal the Series B Vote
Multiple in effect immediately prior to such event multiplied, first, by the
additional voting rights to which the holder of a share of Common Stock shall be
entitled upon exercise of such right or warrant by virtue of the capital stock
which could be acquired upon such exercise and multiplied again by the Series B
Discount Fraction and (iii) such additional distributions upon liquidation,
dissolution or winding up of
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the Corporation as equal the Series B Liquidation Multiple in effect immediately
prior to such event multiplied, first, by the additional amount which the holder
of a share of Common Stock shall be entitled to receive upon liquidation,
dissolution or winding up of the Corporation upon exercise of such right or
warrant by virtue of the capital stock which could be acquired upon such
exercise and multiplied again by the Series B Discount Fraction. For purposes of
this paragraph, the "Series B Discount Fraction" shall be a fraction the
numerator of which shall be the difference between the Fair Market Value of a
share of the capital stock subject to a right or warrant distributed to holders
of shares of Common Stock of the Corporation as contemplated by this paragraph
immediately after the distribution thereof and the purchase price per share for
such share of capital stock pursuant to such right or warrant and the
denominator of which shall be the Fair Market Value of a share of such capital
stock immediately after the distribution of such right or warrant.
(D) For purposes of this Section (e) of Article III, the
"Fair Market Value" of a share of capital stock of the Corporation (including a
share of Common Stock) on any date shall be deemed to be the average of the
daily closing price per share thereof over the 30 consecutive Trading Days (as
such term is hereinafter defined) immediately prior to such date; provided,
however, that, in the event that such Fair Market Value of any such share of
capital stock is determined during a period which includes any date that is
within 30 Trading Days after (i) the ex-dividend date for a dividend or
distribution on stock payable in shares of such stock or securities convertible
into shares of such stock, or (ii) the effective date of any subdivision, split,
combination, consolidation, reverse stock split or reclassification of such
stock, then, and in each such case, the Fair Market Value shall be appropriately
adjusted by the Board of Directors of the Corporation to take into account
ex-dividend or post-effective date trading. 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 applicable transaction reporting system with
respect to securities listed or admitted to trading on the New York Stock
Exchange), or, if the shares are not listed or admitted to trading on the New
York Stock Exchange, as reported in the applicable transaction reporting system
with respect to securities listed on the principal national, securities exchange
on which the shares are listed or admitted to trading or, if the shares are not
listed or admitted to trading on any national securities exchange, the last
quoted price or, if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by the National Association
of Securities Dealers, Inc. Automated Quotation System's National Market System
("NASDAQ/NMS") or such other system then in use, or if on any such date the
shares are not quoted by any such organization, the average of the closing bid
and asked prices as furnished by a professional market maker making a market in
the shares selected by the Board of Directors of the Corporation. The term
"Trading Day" shall mean a day on which the principal national securities
exchange on which the shares are listed or admitted to trading is open for the
transaction of business or, if the shares are not listed or admitted to trading
on any national securities exchange, on which the NASDAQ/NMS or such national
securities exchange as may be selected by the Board of Directors of the
Corporation is open. If the shares are not publicly held or not so listed or
traded on any day within the period of 30 Trading Days applicable to the
determination of Fair Market Value thereof as aforesaid, "Fair Market Value"
shall mean the fair market value thereof per share as determined in good faith
by the Board of Directors of the Corporation. In either case referred to in the
foregoing sentence, the determination of Fair Market Value shall be described in
a statement filed with the Secretary of the Corporation.
(8) Consolidation, Merger, etc. In case the Corporation shall enter
into any consolidation, merger, combination or other transaction in which the
shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case each
outstanding share of Series B Preferred Stock shall at the same time be
similarly exchanged for or
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changed into the aggregate amount of stock, securities, cash and/or other
property (payable in like kind), as the case may be, for which or into which
each share of Common Stock is changed or exchanged multiplied by the highest of
the Series B Vote Multiple, the Series B Dividend Multiple or the Series B
Liquidation Multiple in effect immediately prior to such event.
(9) Effective Time of Adjustments.
(A) Adjustments to the Series B Preferred Stock required by
the provisions hereof shall be effective as of the time at which the event
requiring such adjustments occurs.
(B) The Corporation shall give prompt written notice to each
holder of a share of Series B Preferred Stock of the effect of any adjustment to
the voting rights, dividend rights or rights upon liquidation, dissolution or
winding up of the Corporation of such shares required by the provisions hereof.
Notwithstanding the foregoing sentence, the failure of the Corporation to give
such notice shall not affect the validity of or the force or effect of or the
requirement for such adjustment.
(10) No Redemption. The shares of Series B Preferred Stock shall not
be redeemable at the option of the Corporation or any holder thereof.
Notwithstanding the foregoing sentence of this Section 10, the Corporation may
acquire shares of Series B Preferred Stock in any other manner permitted by law
and the Articles of Incorporation.
(11) Ranking. Unless otherwise provided in these Articles of
Incorporation, the Series B Preferred Stock shall rank pari pasu with the Series
C Preferred Stock and junior to all other series of the Corporation's Preferred
Stock as to the payment of dividends and the distribution of assets on
liquidation, dissolution or winding up and shall rank senior to the Common
Stock.
(12) Amendment. These Articles of Incorporation of the Corporation
shall not be amended in any manner which would adversely affect the rights,
preferences or limitations of the Series B Preferred Stock without, in addition
to any other vote of shareholders required by law, the approval of (1) the
holders of the then outstanding Rights (as defined in Section (f)(4)(C) of this
Article III) and (2) the holders of the then outstanding shares of the Series B
Preferred Stock, with the holders of the Rights and the holders of the Series B
Preferred Stock voting together as a single voting group; provided, however,
that the holder of each share of Series B Preferred Stock shall have one vote
and the holder of each Right shall have one one-hundredth of a vote with respect
to each such amendment."
"(g) SERIES C JUNIOR PARTICIPATING PREFERRED STOCK
(1) Designation and Amount. The shares of such series shall be
designated as "Series C Junior Participating Preferred Stock" (the "Series C
Preferred Stock") and the number of shares constituting such series shall be
300,000.
(2) Dividends and Distributions.
(A) Subject to the provisions for adjustment hereinafter set
forth, the holders of shares of Series C Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds legally
available for the purpose, (i) cash dividends in an amount per share (rounded to
the nearest cent) equal to 100 times the aggregate per share amount of all cash
dividends declared or paid on the Class A Common Stock of the Corporation and
(ii) a preferential cash dividend (the "Series C Preferential Cash Dividends"),
if any, on the first day of February, May, August and
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November of each year (each a "Series C Quarterly Dividend Payment Date"),
commencing on the first Series C Quarterly Dividend Payment Date after the first
issuance of a share or fraction of a share of Series C Preferred Stock, in an
amount equal to $.65 per share of Series C Preferred Stock less the per share
amount of all cash dividends declared on the Series C Preferred Stock pursuant
to clause (i) of this sentence since the immediately preceding Series C
Quarterly Dividend Payment Date or, with respect to the first Series C Quarterly
Dividend Payment Date, since the first issuance of any share or fraction of a
share of Series C Preferred Stock. In the event the Corporation shall, at any
time after the issuance of any share or fraction of a share of Series C
Preferred Stock, make any distribution on the shares of Cass A Common Stock of
the Corporation, whether by way of a dividend or a reclassification of stock, a
recapitalization, reorganization or partial liquidation of the Corporation or
otherwise, which is payable in cash or any debt security, debt instrument, real
or personal property or any other property (other than cash dividends subject to
the immediately preceding sentence, a distribution of shares of Class A Common
Stock or other capital stock of the Corporation or a distribution of rights or
warrants to acquire any such share, including any debt security convertible into
or exchangeable for any such share, at a price less than the Fair Market Value
(as defined in Section (g)(7)(D) of this Article III) of such share), then and
in each such event the Corporation shall simultaneously pay on each then
outstanding share of Series C Preferred Stock of the Corporation a distribution,
in like kind, of 100 times such distribution paid on a share of Class A Common
Stock (subject to the provisions for adjustment hereinafter set forth). The
dividends and distributions on the Series C Preferred Stock to which holders
thereof are entitled pursuant to clause (i) of the first sentence of this
paragraph and pursuant to the second sentence of this paragraph are hereinafter
referred to as "Series C Participating Dividends" and the multiple of such cash
and non-cash dividends on the Class A Common Stock applicable to the
determination of the Series C Participating Dividends, which shall be 100
initially but shall be adjusted from time to time as hereinafter provided, is
hereinafter referred to as the "Series C Dividend Multiple". In the event the
Corporation shall at any time after November 2, 2003 declare or pay any dividend
or make any distribution on Class A Common Stock payable in shares of Class A
Common Stock, or effect a subdivision or split or a combination, consolidation
or reverse split of the outstanding shares of Class A Common Stock into a
greater or lesser number of shares of Class A Common Stock, then in each such
case the Series C Dividend Multiple thereafter applicable to the determination
of the amount of Series C Participating Dividends which holders of shares of
Series C Preferred Stock shall be entitled to receive shall be the Series C
Dividend Multiple applicable immediately prior to such event multiplied by a
fraction the numerator of which is the number of shares of Class A Common Stock
outstanding immediately after such event and the denominator of which is the
number of shares of Class A Common Stock that were outstanding immediately prior
to such event.
(B) The Corporation shall declare each Series C
Participating Dividend at the same time it declares any cash or non-cash
dividend or distribution on the Class A Common Stock in respect of which a
Series C Participating Dividend is required to be paid. No cash or non-cash
dividend or distribution on the Class A Common Stock in respect of which a
Series C Participating Dividend is required to be paid shall be paid or set
aside for payment on the Class A Common Stock unless a Series C Participating
Dividend in respect of such dividend or distribution on the Class A Common Stock
shall be simultaneously paid, or set aside for payment, on the Series C
Preferred Stock.
(C) Series C Preferential Cash Dividends shall begin to
accrue on outstanding shares of Series C Preferred Stock from the Series C
Quarterly Dividend Payment Date next preceding the date of issuance of any
shares of Series C Preferred Stock. Accrued but unpaid Series C Preferential
Cash Dividends shall be cumulative but shall not bear interest. Series C
Preferential Cash Dividends paid on the shares of Series C Preferred Stock in an
amount less than the total amount of such dividends at the
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time accrued and payable on such shares shall be allocated pro rata on a
share-by-share basis among all such shares at the time outstanding.
(3) Voting Rights. The holders of shares of Series C Preferred Stock
shall have the following voting rights:
(A) Subject to the provisions for adjustment hereinafter set
forth, each share of Series C Preferred Stock shall entitle the holder thereof
to 10 votes on all matters submitted to a vote of the shareholders of the
Corporation. The number of votes which a holder of a share of Series C Preferred
Stock is entitled to cast, as the same may be adjusted from time to time as
hereinafter provided, is hereinafter referred to as the "Series C Vote
Multiple". In the event the Corporation shall at any time after November 2, 2003
declare or pay any dividend on Class A Common Stock payable in shares of Class A
Common Stock, or effect a subdivision or split or a combination, consolidation
or reverse split of the outstanding shares of Class A Common Stock into a
greater or lesser number of shares of Class A Common Stock, then in each such
case the Series C Vote Multiple thereafter applicable to the determination of
the number of votes per share to which holders of shares of Series C Preferred
Stock shall be entitled after such event shall be the Series C Vote Multiple
immediately prior to such event multiplied by a fraction the numerator of which
is the number of shares of Class A Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Class A
Common Stock that were outstanding immediately prior to such event.
(B) Except as otherwise provided in these Articles of
Incorporation or the Bylaws of the Corporation, the holders of shares of Series
C Preferred Stock and Series B Preferred Stock and the holders of shares of
Class A Common Stock and Common Stock shall vote together as a single voting
group on all matters submitted to a vote of shareholders of the Corporation.
(C) Unless otherwise provided in these Articles of
Incorporation, in the event that any preferential cash dividend to which the
holders of any currently existing or future series of the Series C Preferred
Stock are entitled (collectively, the "Series C Preferred Cash Dividends") has
accrued for four or more quarterly dividend periods, whether consecutive or not,
and shall not have been declared and paid (or a sum sufficient for the payment
thereof has been set aside) in full, the holders of record of such series of
Series C Preferred Stock, other than any series in respect of which such right
is expressly withheld by these Articles of Incorporation (such holders existing
from time to time being hereinafter referred to as the "Unpaid Series C
Holders"), acting as a single voting group, shall have the right, at the next
meeting of shareholders called for the election of Directors, to elect one
member to the Board of Directors, which Director (hereinafter, the "Series C
Preferred Director") shall be in addition to the number of Directors required by
the Bylaws of the Corporation prior to such event, to serve until the next
annual meeting of shareholders and until their successors are elected and
qualified or their earlier resignation, removal or incapacity or until such
earlier time as all accrued and unpaid Series C Preferred Cash Dividends shall
have been paid (or a sum sufficient for the payment thereof has been set aside)
in full. If at any annual meeting of shareholders at which the term of a Series
C Preferred Director is fixed to expire there are accrued Series C Preferred
Cash Dividends which have not been paid (or a sum sufficient for payment thereof
has not been set aside) in full, the Unpaid Series C Holders shall have the
right to elect a Series C Preferred Director to the vacant Directorship
resulting from the expiration of the term of such Series C Preferred Director in
the manner provided in the immediately preceding sentence until all accrued and
unpaid Series C Preferred Cash Dividends shall have been paid (or a sum
sufficient for payment thereof has been set aside) in full; provided, however,
that at no time shall more than one Series C Preferred Director be a member of
the Board of Directors. The Series C Preferred Director may be removed, with or
without cause, by the Unpaid Series C Holders. Vacancies in such Directorship
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(whether caused by death, resignation, removal or otherwise) may be filled (if
any accrued Series C Preferred Cash Dividends remain unpaid or a sum sufficient
for payment thereof has not been set aside) only by the Unpaid Series C Holders
in the manner permitted by law; provided, however, that any such action by the
Unpaid Series C Holders shall be taken at a meeting of shareholders and shall
not be taken by written consent; provided further, however, that by a vote of a
majority of the Board of Directors in office other than the Series C Preferred
Director, the Series C Preferred Director may be removed immediately after all
accrued and unpaid Series C Preferred Cash Dividends shall have been paid (or a
sum sufficient for the payment thereof has been set aside) in full.
(D) Except as otherwise provided in these Articles of
Incorporation or the Bylaws of the Corporation, holders of Series C Preferred
Stock shall have no special voting rights and their consent shall not be
required (except to the extent they are entitled to vote with holders of Class A
Common Stock as set forth herein) for the taking of any corporate action.
(4) Certain Restrictions.
(A) Whenever Series C Preferential Cash Dividends or Series
C Participating Dividends are in arrears or the Corporation shall be in default
of payment thereof, thereafter and until all accrued and unpaid Series C
Preferential Cash Dividends and Series C Participating Dividends, whether or not
declared, on shares of Series C Preferred Stock outstanding shall have been paid
(or a sum sufficient for payment thereof has been set aside) in full, and in
addition to any and all other rights which any holder of shares of Series C
Preferred Stock may have in such circumstances, the Corporation shall not
(i) declare or pay dividends on, make any other
distributions on, or redeem or purchase or otherwise acquire for
consideration, any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series C Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity as to
dividends with the Series C Preferred Stock, unless dividends
are paid ratably on the Series C Preferred Stock and all such
parity stock on which dividends are payable or in arrears in
proportion to the total amounts to which the holders of all such
shares are then entitled if the full dividends accrued thereon
were to be paid;
(iii) except as permitted by subparagraph (iv) of this
paragraph (4)(A), redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either as
to dividends or upon liquidation, dissolution or winding up)
with the Series C Preferred Stock, provided that the Corporation
may at any time redeem, purchase or otherwise acquire shares of
any such parity stock in exchange for shares of any stock of the
Corporation ranking junior (both as to dividends and upon
liquidation, dissolution or winding up) to the Series C
Preferred Stock; or
(iv) purchase or otherwise acquire for consideration
any shares of Series C Preferred Stock, or any shares of stock
ranking on a parity with the Series C Preferred Stock (either as
to dividends or upon liquidation, dissolution or winding up),
except in accordance with a purchase offer made to all holders
of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other
relative rights and preferences of the respective series and
classes, shall determine
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in good faith will result in fair and equitable treatment among
the respective series or classes.
(B) The Corporation shall not permit any Subsidiary (as
hereinafter defined) of the Corporation to purchase or otherwise acquire for
consideration any shares of stock of the Corporation unless the Corporation
could, under paragraph (A) of this Section 4, purchase or otherwise acquire such
shares at such time and in such manner. A "Subsidiary" of the Corporation shall
mean any corporation or other entity of which securities or other ownership
interests having ordinary voting power sufficient to elect a majority of the
Board of Directors or other persons performing similar functions are
beneficially owned, directly or indirectly, by the Corporation or by any
corporation or other entity that is otherwise controlled by the Corporation.
(C) The Corporation shall not issue any shares of Series C
Preferred Stock except upon exercise of Rights (the "Series C Rights") issued
pursuant to that certain Rights Agreement dated as of November 2, 2003 between
the Corporation and SunTrust Bank, as rights agent, a copy of which is on file
with the Secretary of the Corporation at its principal executive office and
shall be made available to shareholders of record without charge upon written
request therefor addressed to said Secretary. Notwithstanding the foregoing
sentence, nothing contained in the provisions hereof shall prohibit or restrict
the Corporation from issuing for any purpose any series of preferred stock with
rights and privileges similar to, different from, or greater than, those of the
Series C Preferred Stock.
(5) Reacquired Shares. Any shares of Series C Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and canceled promptly after the acquisition thereof. All such
shares upon their retirement and cancellation shall become authorized but
unissued shares of preferred stock, without designation as to series, and such
shares may be reissued as part of a new series of preferred stock to be created
by resolution or resolutions of the Board of Directors.
(6) Liquidation, Dissolution or Winding Up. Upon any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (A) to the holders of shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or winding up) to the
Series C Preferred Stock unless the holders of shares of Series C Preferred
Stock shall have received, subject to adjustment as hereinafter provided, (i)
$39 per one-hundredth share plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of such payment,
or (ii) if greater than the amount specified in clause (A)(i) of this sentence,
an amount equal to 100 times the aggregate amount to be distributed per share to
holders of Class A Common Stock, as the same may be adjusted as hereinafter
provided, and (B) to the holders of stock ranking on a parity upon liquidation,
dissolution or winding up with the Series C Preferred Stock, unless
simultaneously therewith distributions are made ratably on the Series C
Preferred Stock and all other shares of such parity stock in proportion to the
total amounts to which the holders of shares of Series C Preferred Stock are
entitled under clause (A)(i) of this sentence and to which the holders of such
parity shares are entitled, in each case upon such liquidation, dissolution or
winding up. The amount to which holders of Series C Preferred Stock may be
entitled upon liquidation, dissolution or winding up of the Corporation pursuant
to clause (A) of the foregoing sentence is hereinafter referred to as the
"Series C Participating Liquidation Amount" and the multiple of the amount to be
distributed to holders of shares of Class A Common Stock upon the liquidation,
dissolution or winding up of the Corporation applicable pursuant to said clause
to the determination of the Participating Liquidation Amount, as said multiple
may be adjusted from time to time as hereinafter provided, is hereinafter
referred to as the "Series C Liquidation Multiple". In the event the Corporation
shall at any time after November 2, 2003 declare or pay any dividend on Class A
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Common Stock payable in shares of Class A Common Stock, or effect a subdivision
or split or a combination, consolidation or reverse split of the outstanding
shares of Class A Common Stock into a greater or lesser number of shares of
Class A Common Stock, then in each such case the Series C Liquidation Multiple
thereafter applicable to the determination of the Series C Participating
Liquidation Amount to which holders of Series C Preferred Stock shall be
entitled after such event shall be the Series C Liquidation Multiple applicable
immediately prior to such event multiplied by a fraction the numerator of which
is the number of shares of Class A Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Class A
Common Stock that were outstanding immediately prior to such event.
(7) Certain Reclassifications and Other Events.
(A) In the event that holders of shares of Class A Common
Stock of the Corporation receive after November 2, 2003 in respect of their
shares of Class A Common Stock any share of capital stock of the Corporation
(other than any share of Class A Common Stock of the Corporation), whether by
way of reclassification, recapitalization, reorganization, dividend or other
distribution or otherwise (a "Class A Common Stock Transaction"), then and in
each such event the dividend rights, voting rights and rights upon the
liquidation, dissolution or winding up of the Corporation of the shares of
Series C Preferred Stock shall be adjusted so that after such event the holders
of Series C Preferred Stock shall be entitled, in respect of each share of
Series C Preferred Stock held, in addition to such rights in respect thereof to
which such holder was entitled immediately prior to such adjustment, to (i) such
additional dividends as equal the Series C Dividend Multiple in effect
immediately prior to such Class A Common Stock Transaction multiplied by the
additional dividends which the holder of a share of Class A Common Stock shall
be entitled to receive by virtue of the receipt in the Class A Common Stock
Transaction of such capital stock, (ii) such additional voting rights as equal
the Series C Vote Multiple in effect immediately prior to such Class A Common
Stock Transaction multiplied by the additional voting rights which the holder of
a share of Class A Common Stock shall be entitled to receive by virtue of the
receipt in the Class A Common Stock Transaction of such capital stock and (iii)
such additional distributions upon liquidation, dissolution or winding up of the
Corporation as equal the Series C Liquidation Multiple in effect immediately
prior to such Class A Common Stock Transaction multiplied by the additional
amount which the holder of a share of Class A Common Stock shall be entitled to
receive upon liquidation, dissolution or winding up of the Corporation by virtue
of the receipt in the Class A common Stock Transaction of such capital stock, as
the case may be, all as provided by the terms of such capital stock.
(B) In the event that holders of shares of Class A Common
Stock of the Corporation receive after November 2, 2003 in respect of their
shares of Class A Common Stock any right or warrant to purchase Class A Common
Stock (including as such a right, for all purposes of this paragraph, any
security convertible into or exchangeable for Class A Common Stock) at a
purchase price per share less than the Fair Market Value (as hereinafter
defined) of a share of Class A Common Stock on the date of issuance of such
right or warrant, then and in each such event the dividend rights, voting rights
and rights upon the liquidation, dissolution or winding up of the Corporation of
the shares of Series C Preferred Stock shall each be adjusted so that after such
event the Series C Dividend Multiple, the Series C Vote Multiple and the Series
C Liquidation Multiple shall each be the product of the Series C Dividend
Multiple, the Series C Vote Multiple and the Series C Liquidation Multiple, as
the case may be, in effect immediately prior to such event multiplied by a
fraction the numerator of which shall be the number of shares of Class A Common
Stock outstanding immediately before such issuance of rights or warrants plus
the maximum number of shares of Class A Common Stock which could be acquired
upon exercise in full of all such rights or warrants and the denominator of
which shall be the number of shares of Class A
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Common Stock outstanding immediately before such issuance of rights or warrants
plus the number of shares of Class A Common Stock which could be purchased, at
the Fair Market Value of the Class A Common Stock at the time of such issuance,
by the maximum aggregate consideration payable upon exercise in full of all such
rights or warrants.
(C) In the event that holders of shares of Class A Common
Stock of the Corporation receive after November 2, 2003 in respect of their
shares of Class A Common Stock any right or warrant to purchase capital stock of
the Corporation (other than shares of Class A Common Stock), including as such a
right, for all purposes of this paragraph, any security convertible into or
exchangeable for capital stock of the Corporation (other than Class A Common
Stock), at a purchase price per share less than the Fair Market Value of such
shares of capital stock on the date of issuance of such right or warrant, then
and in each such event the dividend rights, voting rights and rights upon
liquidation, dissolution or winding up of the Corporation of the shares of
Series C Preferred Stock shall each be adjusted so that after such event each
holder of a share of Series C Preferred Stock shall be entitled, in respect of
each share of Series C Preferred Stock held, in addition to such rights in
respect thereof to which such holder was entitled immediately prior to such
event, to receive (i) such additional dividends as equal the Series C Dividend
Multiple in effect immediately prior to such event multiplied, first, by the
additional dividends to which the holder of a share of Class A Common Stock
shall be entitled upon exercise of such right or warrant by virtue of the
capital stock which could be acquired upon such exercise and multiplied again by
the Series C Discount Fraction (as hereinafter defined) and (ii) such additional
voting rights as equal the Series C Vote Multiple in effect immediately prior to
such event multiplied, first, by the additional voting rights to which the
holder of a share of Class A Common Stock shall be entitled upon exercise of
such right or warrant by virtue of the capital stock which could be acquired
upon such exercise and multiplied again by the Series C Discount Fraction and
(iii) such additional distributions upon liquidation, dissolution or winding up
of the Corporation as equal the Series C Liquidation Multiple in effect
immediately prior to such event multiplied, first, by the additional amount
which the holder of a share of Class A Common Stock shall be entitled to receive
upon liquidation, dissolution or winding up of the Corporation upon exercise of
such right or warrant by virtue of the capital stock which could be acquired
upon such exercise and multiplied again by the Series C Discount Fraction. For
purposes of this paragraph, the "Series C Discount Fraction" shall be a fraction
the numerator of which shall be the difference between the Fair Market Value of
a share of the capital stock subject to a right or warrant distributed to
holders of shares of Class A Common Stock of the Corporation as contemplated by
this paragraph immediately after the distribution thereof and the purchase price
per share for such share of capital stock pursuant to such right or warrant and
the denominator of which shall be the Fair Market Value of a share of such
capital stock immediately after the distribution of such right or warrant.
(D) For purposes of this Section (e) of Article III, the
"Fair Market Value" of a share of capital stock of the Corporation (including a
share of Class A Common Stock) on any date shall be deemed to be the average of
the daily closing price per share thereof over the 30 consecutive Trading Days
(as such term is hereinafter defined) immediately prior to such date; provided,
however, that, in the event that such Fair Market Value of any such share of
capital stock is determined during a period which includes any date that is
within 30 Trading Days after (i) the ex-dividend date for a dividend or
distribution on stock payable in shares of such stock or securities convertible
into shares of such stock, or (ii) the effective date of any subdivision, split,
combination, consolidation, reverse stock split or reclassification of such
stock, then, and in each such case, the Fair Market Value shall be appropriately
adjusted by the Board of Directors of the Corporation to take into account
ex-dividend or post-effective date trading. 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 applicable transaction reporting system with
respect to securities listed or admitted to
A-14
trading on the New York Stock Exchange), or, if the shares are not listed or
admitted to trading on the New York Stock Exchange, as reported in the
applicable transaction reporting system with respect to securities listed on the
principal national, securities exchange on which the shares are listed or
admitted to trading or, if the shares are not listed or admitted to trading on
any national securities exchange, the last quoted price or, if not so quoted,
the average of the high bid and low asked prices in the over-the-counter market,
as reported by the National Association of Securities Dealers, Inc. Automated
Quotation System's National Market System ("NASDAQ/NMS") or such other system
then in use, or if on any such date the shares are not quoted by any such
organization, the average of the closing bid and asked prices as furnished by a
professional market maker making a market in the shares selected by the Board of
Directors of the Corporation. The term "Trading Day" shall mean a day on which
the principal national securities exchange on which the shares are listed or
admitted to trading is open for the transaction of business or, if the shares
are not listed or admitted to trading on any national securities exchange, on
which the NASDAQ/NMS or such national securities exchange as may be selected by
the Board of Directors of the Corporation is open. If the shares are not
publicly held or not so listed or traded on any day within the period of 30
Trading Days applicable to the determination of Fair Market Value thereof as
aforesaid, "Fair Market Value" shall mean the fair market value thereof per
share as determined in good faith by the Board of Directors of the Corporation.
In either case referred to in the foregoing sentence, the determination of Fair
Market Value shall be described in a statement filed with the Secretary of the
Corporation.
(8) Consolidation, Merger, etc. In case the Corporation shall enter
into any consolidation, merger, combination or other transaction in which the
shares of Class A Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case each
outstanding share of Series C Preferred Stock shall at the same time be
similarly exchanged for or changed into the aggregate amount of stock,
securities, cash and/or other property (payable in like kind), as the case may
be, for which or into which each share of Class A Common Stock is changed or
exchanged multiplied by the highest of the Series C Vote Multiple, the Series C
Dividend Multiple or the Series C Liquidation Multiple in effect immediately
prior to such event.
(9) Effective Time of Adjustments.
(A) Adjustments to the Series C Preferred Stock required by
the provisions hereof shall be effective as of the time at which the event
requiring such adjustments occurs.
(B) The Corporation shall give prompt written notice to each
holder of a share of Series C Preferred Stock of the effect of any adjustment to
the voting rights, dividend rights or rights upon liquidation, dissolution or
winding up of the Corporation of such shares required by the provisions hereof.
Notwithstanding the foregoing sentence, the failure of the Corporation to give
such notice shall not affect the validity of or the force or effect of or the
requirement for such adjustment.
(10) No Redemption. The shares of Series C Preferred Stock shall not
be redeemable at the option of the Corporation or any holder thereof.
Notwithstanding the foregoing sentence of this Section 10, the Corporation may
acquire shares of Series C Preferred Stock in any other manner permitted by law
and the Articles of Incorporation.
(11) Ranking. Unless otherwise provided in these Articles of
Incorporation, the Series C Preferred Stock shall rank pari pasu with the Series
B Preferred Stock and junior to all other series of the Corporation's Preferred
Stock as to the payment of dividends and the distribution of assets on
liquidation, dissolution or winding up and shall rank senior to the Class A
Common Stock.
A-15
(12) Amendment. These Articles of Incorporation of the Corporation
shall not be amended in any manner which would adversely affect the rights,
preferences or limitations of the Series C Preferred Stock without, in addition
to any other vote of shareholders required by law, the approval of (1) the
holders of the then outstanding Rights (as defined in Section (g)(4)(C) of this
Article III) and (2) the holders of the then outstanding shares of the Series C
Preferred Stock, with the holders of the Rights and the holders of the Series C
Preferred Stock voting together as a single voting group; provided, however,
that the holder of each share of Series C Preferred Stock shall have one vote
and the holder of each Right shall have one one-hundredth of a vote with respect
to each such amendment."
3. The foregoing amendment was adopted by the Board of Directors on
November __, 2003. A vote of shareholders of the Corporation was not needed for
the adoption of these Articles of Amendment.
IN WITNESS WHEREOF, the undersigned Director of the Corporation has
executed these Articles of Amendment on November __, 2003.
HEICO CORPORATION
-------------------------------
By:
Title:
A-16
EXHIBIT B
Form of Series B Preferred Stock Right Certificate
Certificate No. R- _______ Common Stock Rights
NOT EXERCISABLE AFTER NOVEMBER 2, 2013 OR EARLIER IF REDEMPTION OR EXCHANGE
OCCURS. THE COMMON STOCK RIGHTS ARE SUBJECT TO REDEMPTION AT $0.01 PER RIGHT AND
TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER CERTAIN
CIRCUMSTANCES, COMMON STOCK RIGHTS THAT ARE OR WERE ACQUIRED OR BENEFICIALLY
OWNED BY AN ACQUIRING PERSON OR ANY ASSOCIATES OR AFFILIATES THEREOF (AS SUCH
TERMS ARE DEFINED IN THE COMMON STOCK RIGHTS AGREEMENT) OR ANY SUBSEQUENT HOLDER
OF SUCH COMMON STOCK RIGHTS MAY BECOME NULL AND VOID.
Series B Right Certificate
HEICO CORPORATION
This certifies that _______________________, or registered assigns, is the
registered owner of the number of Common Stock Rights set forth above, each of
which entitles the owner thereof, subject to the terms, provisions and
conditions of the Rights Agreement, dated as of November 2, 2003 (the "Rights
Agreement"), between Heico Corporation, a Florida corporation (the "Company"),
and SunTrust Bank (the "Rights Agent"), to purchase from the Company at any time
after the Distribution Date (as such term is defined in the Rights Agreement)
and prior to 5:00 P.M., Miami, Florida time, on November 2, 2013, at the
principal office of the Rights Agent, or at the office of its successor as
Rights Agent, one one-hundredth of a fully paid non-assessable share of Series B
Junior Participating Preferred Stock, par value $0.01 per share (the "Series B
Preferred Shares"), of the Company, at a purchase price of $45.00 per one
one-hundredth of a Series B Preferred Share (the "Series B Purchase Price"),
upon presentation and surrender of this Series B Right Certificate with the
certification and the Form of Election to Purchase duly executed. The number of
Common Stock Rights evidenced by this Series B Right Certificate (and the number
of one one-hundredth of a Series B Preferred Share which may be purchased upon
exercise hereof) set forth above, and the Series B Purchase Price set forth
above, are the number and Series B Purchase Price as of November 2, 2003, based
on the Series B Preferred Shares as constituted at such date. As provided in the
Rights Agreement, the Series B Purchase Price and the number of one
one-hundredth of a Series B Preferred Share which may be purchased upon the
exercise of the Common Stock Rights evidenced by this Series B Right Certificate
are subject to modification and adjustment upon the happening of certain events.
From and after the occurrence of an event described in Section 11(a)(ii) of the
Rights Agreement, if the Common Stock Rights are or were at any time on or after
the earlier of (x) the date of such event and (y) the Series B Distribution Date
(as such term is defined in the Rights Agreement) acquired or beneficially owned
by an Acquiring Person or an Associate or Affiliate of an Acquiring Person (as
such terms are defined in the Rights Agreement), such Common Stock Rights shall
become void, and any holder of such Common Stock Rights shall thereafter have no
right to exercise such Common Stock Rights.
This Series B 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
B-1
rights, limitations of rights, obligations, duties and immunities hereunder of
the Rights Agent, the Company and the holders of the Series B Right
Certificates. Copies of the Rights Agreement are on file at the principal
executive offices of the Company and the offices of the Rights Agent.
This Series B Right Certificate, with or without other Series B Right
Certificates, upon surrender at the principal office of the Rights Agent, may be
exchanged for another Series B Right Certificate or Series B Right Certificates
of like tenor and date evidencing Common Stock Rights entitling the holder to
purchase a like aggregate number of Preferred Shares as the Common Stock Rights
evidenced by the Series B Right Certificate or Series B Right Certificates
surrendered shall have entitled such holder to purchase. If this Series B Right
Certificate shall be exercised in part, the holder shall be entitled to receive
upon surrender hereof another Series B Right Certificate or Series B Right
Certificates for the number of whole Common Stock Rights not exercised.
Subject to the provisions of the Rights Agreement, at the Company's option, the
Common Stock Rights evidenced by this Certificate (i) may be redeemed by the
Company at a redemption price of $0.01 per Common Stock Right or (ii) may be
exchanged in whole or in part for shares of the Company's Class A Common Stock,
par value $0.01 per share, or Series B Preferred Shares.
No fractional Series B Preferred Shares will be issued upon the exercise of any
Common Stock Right or Common Stock Rights evidenced hereby (other than fractions
which are integral multiples of one one-hundredth of a Series B Preferred Share,
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 Series B Right Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Series B
Preferred Shares 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, or otherwise, until the Common Stock Right or Common Stock Rights
evidenced by this Series B Right Certificate shall have been exercised as
provided in the Rights Agreement.
[Balance of Page Intentionally Blank]
B-2
This Series B Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company and its
corporate seal. Dated as of _______________, ____.
Attest: HEICO CORPORATION
By:
------------------------------
Countersigned: Title:
---------------------------
- --------------------------------
Rights Agent
By:
-----------------------------
Authorized Signature
B-3
Form of Reverse Side of Series B Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Series B Right Certificate.)
FOR VALUE RECEIVED _________________________________ hereby sells, assigns and
transfers unto ____________________________________________________ (Please
print name and address of transferee) this Series B Right Certificate, together
with all right, title and interest therein, and does hereby irrevocably
constitute and appoint ____________________________, Attorney, to transfer the
within Series B Right Certificate on the books of the within-named Company, with
full power of substitution.
Dated: _____________ ___, _____
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company having an office or correspondent in
the United States.
The undersigned hereby certifies that the Common Stock Rights evidenced by this
Series B Right Certificate are not beneficially owned by an Acquiring Person or
an Affiliate or Associate thereof (as defined in the Rights Agreement).
Signature
B-4
Form of Reverse Side of Series B Right Certificate - continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise the Series B Right Certificate.)
To HEICO CORPORATION:
The undersigned hereby irrevocably elects to exercise ________________ Common
Stock Rights represented by this Series B Right Certificate to purchase the
Series B Preferred Shares issuable upon the exercise of such Common Stock Rights
and requests that certificates for such Series B Preferred Shares be issued in
the name of:
Please insert social security
or other identifying number
(Please print name and address)
If such number of Common Stock Rights shall not be all the Common Stock Rights
evidenced by this Series B Right Certificate, a new Series B Right Certificate
for the balance remaining of such Common Stock Rights shall be registered in the
name of and delivered to:
Please insert social security
or other identifying number
(Please print name and address)
Dated: _____________ ___, _____
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company having an office or correspondent in
the United States.
The undersigned hereby certifies that the Common Stock Rights evidenced by this
Series B Right Certificate are not beneficially owned by an Acquiring Person or
an Affiliate or Associate thereof (as defined in the Rights Agreement).
Signature
NOTICE
The signature in the foregoing Forms of Assignment and Election must conform to
the name as written upon the face of this Series B Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.
In the event the certification set forth above in the Form of Assignment or the
Form of Election to Purchase, as the case may be, is not completed, the Company
and the Rights Agent will deem the beneficial owner of the Common Stock Rights
evidenced by this Series B Right Certificate to be an Acquiring Person or an
Affiliate or Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.
B-5
EXHIBIT C
SUMMARY OF COMMON STOCK RIGHTS TO PURCHASE
PREFERRED SHARES
Effective November 2, 2003, the Board of Directors of Heico Corporation (the
"Company") declared a dividend of one preferred share purchase right (a "Common
Stock Right") for each outstanding share of common stock, par value $0.01 per
share (the "Common Shares") outstanding on November 2, 2003 (the "Common Stock
Record Date"). Each Common Stock Right entitles the registered holder to
purchase from the Company one one-hundredth of a share of Series B Junior
Participating Preferred Stock, par value $0.01 per share (the "Series B
Preferred Shares"), of the Company, at a price of $45.00 per one one-hundredth
of a Preferred Share (the "Series B Purchase Price"), subject to adjustment. The
description and terms of the Common Stock Rights will be set forth in a Rights
Agreement (the "Rights Agreement") between the Company and SunTrust Bank, as
Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) 10 days following a public announcement that a
person or group of affiliated or associated persons (an "Acquiring Person") has
acquired beneficial ownership of 15% or more of the outstanding Common Shares or
(ii) 10 business days (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)
following the commencement of, or announcement of an intention to make, a tender
offer or exchange offer the consummation of which would result in the beneficial
ownership by a person or group of 15% or more of such outstanding Common Shares
(the earlier of such dates being called the "Distribution Date"), the Common
Stock Rights will be evidenced, with respect to any of the Common Share
certificates outstanding as of the Record Date, by such Common Share certificate
with a copy of this Summary of Common Stock Rights attached thereto.
The Agreement provides that, until the Distribution Date, the Common Stock
Rights will be transferred with and only with the Common Shares. Until the
Distribution Date (or earlier redemption or expiration of the Common Stock
Rights), new Common Share certificates issued after the Record Date or upon
transfer or new issuance of Common Shares will contain a notation incorporating
the Agreement by reference. Until the Distribution Date (or earlier redemption
or expiration of the Common Stock Rights), the surrender for transfer of any
certificates for Common Shares, even without such notation or a copy of this
Summary of Rights to Purchase Series B Preferred Stock being attached thereto,
will also constitute the transfer of the Common Stock Rights associated with the
Common Shares represented by such certificate. As soon as practicable following
the Distribution Date, separate certificates evidencing the Common Stock Rights
("Series B Right Certificates") will be mailed to holders of record of the
Common Shares as of the Close of Business on the Distribution Date and such
separate Series B Right Certificates alone will evidence the Common Stock
Rights.
The Common Stock Rights are not exercisable until the Distribution Date. The
Common Stock Rights will expire on November 2, 2013 (the "Final Expiration
Date"), unless the Final Expiration Date is extended or unless the Common Stock
Rights are earlier redeemed by the Company, in each case, as described below.
The Series B Purchase Price payable, and the number of Preferred Shares or other
securities or property issuable, upon exercise of the Common Stock Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification
C-1
of, the Preferred Shares, (ii) upon the grant to holders of the Preferred Shares
of certain rights or warrants to subscribe for or purchase Preferred Shares at a
price, or securities convertible into Preferred Shares with a conversion price,
less than the then current market price of the Preferred Shares or (iii) upon
the distribution to holders of the Preferred Shares of evidences of indebtedness
or assets (excluding regular periodic cash dividends paid out of earnings or
retained earnings or dividends payable in Preferred Shares) or of subscription
rights or warrants (other than those referred to above).
The number of outstanding Common Stock Rights and the number of one
one-hundredth of a Preferred Share issuable upon exercise of each Common Stock
Right are also subject to adjustment in the event of a stock split of the Common
Shares or a stock dividend on the Common Shares payable in Common Shares or
subdivisions, consolidations or combinations of the Common Shares occurring, in
any such case, prior to the Distribution Date.
Preferred Shares purchasable upon exercise of the Common Stock Rights will not
be redeemable. Each Preferred Share will be entitled to a quarterly dividend
payment of 100 times the dividend declared per Common Share. In the event of
liquidation, the holders of the Preferred Shares will be entitled to an
aggregate payment of 100 times the aggregate payment made per Common Share. Each
Preferred Share will have 100 votes, voting together with the Common Shares. In
the event of any merger, consolidation or other transaction in which Common
Shares are exchanged, each Preferred Share will be entitled to receive 100 times
the amount received per Common Share. These rights are protected by customary
antidilution provisions.
Because of the nature of the Preferred Shares' dividend, liquidation and voting
rights, the value of the one one-hundredth interest in a Preferred Share
purchasable upon exercise of each Common Stock Right should approximate the
value of one Common Share.
From and after the occurrence of an event described in Section 11(a)(ii) of the
Rights Agreement, if the Common Stock Rights evidenced by this Series B Right
Certificate are or were at any time on or after the earlier of (x) the date of
such event and (y) the Distribution Date (as such term is defined in the Rights
Agreement) acquired or beneficially owned by an Acquiring Person or an Associate
or Affiliate of an Acquiring Person (as such terms are defined in the Rights
Agreement), such Common Stock Rights shall become void, and any holder of such
Common Stock Rights shall thereafter have no right to exercise such Common Stock
Rights.
In the event that, at any time after a Person becomes an Acquiring Person, the
Company is acquired in a merger or other business combination transaction or 50%
or more of its consolidated assets or earning power are sold, proper provision
will be made so that each holder of a Common Stock Right will thereafter have
the right to receive, upon the exercise thereof at the then current exercise
price of the Common Stock Right, that number of shares of common stock of the
acquiring company which at the time of such transaction will have a market value
of two times the exercise price of the Common Stock Right. In the event that any
person becomes an Acquiring Person, proper provision shall be made so that each
holder of a Common Stock Right, other than Common Stock Rights beneficially
owned by the Acquiring Person and its Affiliates and Associates (which will
thereafter be void), will thereafter have the right to receive upon exercise
that number of Common Shares having a market value of two times the exercise
price of the Common Stock Right. If the Company does not have sufficient Common
Shares to satisfy such obligation to issue Common Shares, or if the Board of
Directors so elects, the Company shall deliver upon payment of the exercise
price of a Common Stock Right an amount of cash or securities equivalent in
value to the Common Shares issuable upon exercise of a Common Stock Right;
provided that, if the Company fails to meet such obligation within 30 days
following the later of (x) the first occurrence of an event triggering the right
to purchase Common Shares and (y) the date on which the
C-2
Company's right to redeem the Common Stock Rights expires, the Company must
deliver, upon exercise of a Common Stock Right but without requiring payment of
the exercise price then in effect, Common Shares (to the extent available) and
cash equal in value to the difference between the value of the Common Shares
otherwise issuable upon the exercise of a Common Stock Right and the exercise
price then in effect. The Board of Directors may extend the 30-day period
described above for up to an additional 60 days to permit the taking of action
that may be necessary to authorize sufficient additional Common Shares to permit
the issuance of Common Shares upon the exercise in full of the Common Stock
Rights.
At any time after any Person becomes an Acquiring Person and prior to the
acquisition by any person or group of a majority of the outstanding Common
Shares, the Board of Directors of the Company may exchange the Common Stock
Rights (other than Common Stock Rights owned by such person or group which have
become void), in whole or in part, at an exchange ratio of one Common Share per
Common Stock Right (subject to adjustment).
With certain exceptions, no adjustment in the Series B Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Series B Purchase Price. No fractional Preferred Shares will be issued
(other than fractions which are integral multiples of one one-hundredth of a
Preferred Share, which may, at the election of the Company, be evidenced by
depositary receipts) and in lieu thereof, an adjustment in cash will be made
based on the market price of the Preferred Shares on the last trading day prior
to the date of exercise.
At any time prior to the time any Person becomes an Acquiring Person, the Board
of Directors of the Company may redeem the Common Stock Rights in whole, but not
in part, at a price of $0.01 per Common Stock Right (the "Redemption Price").
The redemption of the Common Stock Rights may be made effective at such time, on
such basis and with such conditions as the Board of Directors in its sole
discretion may establish. Immediately upon any redemption of the Common Stock
Rights, the right to exercise the Common Stock Rights will terminate and the
only right of the holders of Common Stock Rights will be to receive the
Redemption Price.
The terms of the Common Stock Rights may be amended by the Board of Directors of
the Company without the consent of the holders of the Common Stock Rights,
except that from and after such time as any person becomes an Acquiring Person
no such amendment may adversely affect the interests of the holders of the
Common Stock Rights (other than the Acquiring Person and its Affiliates and
Associates).
Until a Common Stock Right is exercised, the holder thereof, as such, will have
no rights as a stockholder of the Company, including, without limitation, the
right to vote or to receive dividends.
A copy of the Rights Agreement will be filed with the Securities and Exchange
Commission as an Exhibit to a Registration Statement on Form 8-A. A copy of the
Rights Agreement is available free of charge from the Company. This summary
description of the Common Stock Rights does not purport to be complete and is
qualified in its entirety by reference to the Rights Agreement, which is hereby
incorporated herein by reference.
C-3
EXHIBIT D
Form of Series C Preferred Stock Right Certificate
Certificate No. R- _______ Class A Common Stock Rights
NOT EXERCISABLE AFTER NOVEMBER 2, 2013 OR EARLIER IF REDEMPTION OR EXCHANGE
OCCURS. THE CLASS A COMMON STOCK RIGHTS ARE SUBJECT TO REDEMPTION AT $0.01 PER
RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT. UNDER
CERTAIN CIRCUMSTANCES, CLASS A COMMON STOCK RIGHTS THAT ARE OR WERE ACQUIRED OR
BENEFICIALLY OWNED BY AN ACQUIRING PERSON OR ANY ASSOCIATES OR AFFILIATES
THEREOF (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) OR ANY SUBSEQUENT
HOLDER OF SUCH CLASS A COMMON STOCK RIGHTS MAY BECOME NULL AND VOID.
Series C Right Certificates
HEICO CORPORATION
This certifies that _______________________, or registered assigns, is the
registered owner of the number of Class A Common Stock Rights set forth above,
each of which entitles the owner thereof, subject to the terms, provisions and
conditions of the Rights Agreement, dated as of November 2, 2003 (the "Rights
Agreement"), between Heico Corporation, a Florida corporation (the "Company"),
and SunTrust Bank (the "Rights Agent"), to purchase from the Company at any time
after the Distribution Date (as such term is defined in the Rights Agreement)
and prior to 5:00 P.M., Miami, Florida time, on November 2, 2013, at the
principal office of the Rights Agent, or at the office of its successor as
Rights Agent, one one-hundredth of a fully paid non-assessable share of Series C
Junior Participating Preferred Stock, par value $0.01 per share (the "Series C
Preferred Shares"), of the Company, at a purchase price of $39.00 per one
one-hundredth of a Series C Preferred Share (the "Series C Purchase Price"),
upon presentation and surrender of this Series C Right Certificates with the
certification and the Form of Election to Purchase duly executed. The number of
Class A Common Stock Rights evidenced by this Series C Right Certificates (and
the number of one one-hundredth of a Series C Preferred Share which may be
purchased upon exercise hereof) set forth above, and the Series C Purchase Price
set forth above, are the number and Series C Purchase Price as of November 2,
2003, based on the Series C Preferred Shares as constituted at such date. As
provided in the Rights Agreement, the Series C Purchase Price and the number of
one one-hundredth of a Preferred Share which may be purchased upon the exercise
of the Class A Common Stock Rights evidenced by this Series C Right Certificates
are subject to modification and adjustment upon the happening of certain events.
From and after the occurrence of an event described in Section 11(a)(ii) of the
Rights Agreement, if the Class A Common Stock Rights are or were at any time on
or after the earlier of (x) the date of such event and (y) the Distribution Date
(as such term is defined in the Rights Agreement) acquired or beneficially owned
by an Acquiring Person or an Associate or Affiliate of an Acquiring Person (as
such terms are defined in the Rights Agreement), such Class A Common Stock
Rights shall become void, and any holder of such Class A Common Stock Rights
shall thereafter have no right to exercise such Class A Common Stock Rights.
D-1
This Series C Right Certificates 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 Series C Right Certificates.
Copies of the Rights Agreement are on file at the principal executive offices of
the Company and the offices of the Rights Agent.
This Series C Right Certificate, with or without other Series C Right
Certificates, upon surrender at the principal office of the Rights Agent, may be
exchanged for another Series C Right Certificates or Series C Right Certificates
of like tenor and date evidencing Class A Common Stock Rights entitling the
holder to purchase a like aggregate number of Series C Preferred Shares as the
Class A Common Stock Rights evidenced by the Series C Right Certificates or
Series C Right Certificates surrendered shall have entitled such holder to
purchase. If this Series C Right Certificate shall be exercised in part, the
holder shall be entitled to receive upon surrender hereof another Series C Right
Certificate or Series C Right Certificates for the number of whole Class A
Common Stock Rights not exercised.
Subject to the provisions of the Rights Agreement, at the Company's option, the
Class A Common Stock Rights evidenced by this Certificate (i) may be redeemed by
the Company at a redemption price of $0.01 per Right or (ii) may be exchanged in
whole or in part for shares of the Company's Common Stock, par value $0.01 per
share, or Series C Preferred Shares.
No fractional Series C Preferred Shares will be issued upon the exercise of any
Class A Common Stock Right or Class A Common Stock Rights evidenced hereby
(other than fractions which are integral multiples of one one-hundredth of a
Preferred Share, 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 Series C Right Certificate shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Series C
Preferred Shares 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, or otherwise, until the Class A Common Stock Right or Class A Common
Stock Rights evidenced by this Series C Right Certificate shall have been
exercised as provided in the Rights Agreement.
[Balance of Page Intentionally Blank]
D-2
This Series C Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
WITNESS the facsimile signature of the proper officers of the Company and its
corporate seal. Dated as of _______________, ____.
Attest: HEICO CORPORATION
By:
------------------------------
Countersigned: Title:
---------------------------
- --------------------------------
Rights Agent
By:
-----------------------------
Authorized Signature
D-3
Form of Reverse Side of Series C Right Certificate
FORM OF ASSIGNMENT
(To be executed by the registered holder if such
holder desires to transfer the Series C Right Certificate.)
FOR VALUE RECEIVED _________________________________ hereby sells, assigns and
transfers unto ____________________________________________________ (Please
print name and address of transferee) this Series C Right Certificate, together
with all right, title and interest therein, and does hereby irrevocably
constitute and appoint ____________________________, Attorney, to transfer the
within Series C Right Certificate on the books of the within-named Company, with
full power of substitution.
Dated: _____________ ___, _____
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company having an office or correspondent in
the United States.
The undersigned hereby certifies that the Class A Common Stock Rights evidenced
by this Series C Right Certificate are not beneficially owned by an Acquiring
Person or an Affiliate or Associate thereof (as defined in the Rights
Agreement).
Signature
D-4
Form of Reverse Side of Series C Right Certificate - continued
FORM OF ELECTION TO PURCHASE
(To be executed if holder desires to
exercise the Series C Right Certificate.)
To HEICO CORPORATION:
The undersigned hereby irrevocably elects to exercise ________________ Class A
Common Stock Rights represented by this Series C Right Certificate to purchase
the Series C Preferred Shares issuable upon the exercise of such Class A Common
Stock Rights and requests that certificates for such Series C Preferred Shares
be issued in the name of:
Please insert social security
or other identifying number
(Please print name and address)
If such number of Class A Common Stock Rights shall not be all the Class A
Common Stock Rights evidenced by this Series C Right Certificate, a new Series C
Right Certificate for the balance remaining of such Class A Common Stock Rights
shall be registered in the name of and delivered to:
Please insert social security
or other identifying number
(Please print name and address)
Dated: _____________ ___, _____
Signature
Signature Guaranteed:
Signatures must be guaranteed by a member firm of a registered national
securities exchange, a member of the National Association of Securities Dealers,
Inc., or a commercial bank or trust company having an office or correspondent in
the United States.
The undersigned hereby certifies that the Class A Common Stock Rights evidenced
by this Series C Right Certificate are not beneficially owned by an Acquiring
Person or an Affiliate or Associate thereof (as defined in the Rights
Agreement).
Signature
NOTICE
The signature in the foregoing Forms of Assignment and Election must conform to
the name as written upon the face of this Series C Right Certificate in every
particular, without alteration or enlargement or any change whatsoever.
In the event the certification set forth above in the Form of Assignment or the
Form of Election to Purchase, as the case may be, is not completed, the Company
and the Rights Agent will deem the beneficial owner of the Class A Common Stock
Rights evidenced by this Series C Right Certificate to be an Acquiring Person or
an Affiliate or Associate thereof (as defined in the Rights Agreement) and such
Assignment or Election to Purchase will not be honored.
D-5
EXHIBIT E
SUMMARY OF RIGHTS TO PURCHASE
SERIES C PREFERRED SHARES
Effective November 2, 2003, the Board of Directors of Heico Corporation (the
"Company") declared a dividend of one preferred share purchase right (a "Class A
Common Stock Right") for each outstanding share of common stock, par value $0.01
per share (the "Class A Common Shares") outstanding on November 2, 2003 (the
"Record Date"). Each Class A Common Stock Right entitles the registered holder
to purchase from the Company one one-hundredth of a share of Series C Junior
Participating Preferred Stock, par value $0.01 per share (the "Series C
Preferred Shares"), of the Company, at a price of $39.00 per one one-hundredth
of a Preferred Share (the "Series C Purchase Price"), subject to adjustment. The
description and terms of the Class A Common Stock Rights will be set forth in a
Rights Agreement (the "Rights Agreement") between the Company and SunTrust Bank,
as Rights Agent (the "Rights Agent").
Until the earlier to occur of (i) 10 days following a public announcement that a
person or group of affiliated or associated persons (an "Acquiring Person") has
acquired beneficial ownership of 15% or more of the outstanding Class A Common
Shares or (ii) 10 business days (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) following the commencement of, or announcement of an intention
to make, a tender offer or exchange offer the consummation of which would result
in the beneficial ownership by a person or group of 15% or more of such
outstanding Class A Common Shares (the earlier of such dates being called the
"Distribution Date"), the Class A Common Stock Rights will be evidenced, with
respect to any of the Class A Common Share certificates outstanding as of the
Record Date, by such Class A Common Share certificate with a copy of this
Summary of Rights to Purchase Series C Preferred Stock attached thereto.
The Agreement provides that, until the Distribution Date, the Class A Common
Stock Rights will be transferred with and only with the Class A Common Shares.
Until the Distribution Date (or earlier redemption or expiration of the Class A
Common Stock Rights), new Class A Common Share certificates issued after the
Record Date or upon transfer or new issuance of Class A Common Shares will
contain a notation incorporating the Agreement by reference. Until the
Distribution Date (or earlier redemption or expiration of the Class A Common
Stock Rights), the surrender for transfer of any certificates for Class A Common
Shares, even without such notation or a copy of this Summary of Rights to
Purchase Series C Preferred Stock being attached thereto, will also constitute
the transfer of the Class A Common Stock Rights associated with the Class A
Common Shares represented by such certificate. As soon as practicable following
the Distribution Date, separate certificates evidencing the Class A Common Stock
Rights ("Series C Right Certificates") will be mailed to holders of record of
the Class A Common Shares as of the Close of Business on the Distribution Date
and such separate Series C Right Certificates alone will evidence the Class A
Common Stock Rights.
The Class A Common Stock Rights are not exercisable until the Distribution Date.
The Class A Common Stock Rights will expire on November 2, 2013 (the "Final
Expiration Date"), unless the Final Expiration Date is extended or unless the
Class A Common Stock Rights are earlier redeemed by the Company, in each case,
as described below.
The Series C Purchase Price payable, and the number of Series C Preferred Shares
or other securities or property issuable, upon exercise of the Class A Common
Stock Rights are subject to adjustment from
E-1
time to time to prevent dilution (i) in the event of a stock dividend on, or a
subdivision, combination or reclassification of, the Series C Preferred Shares,
(ii) upon the grant to holders of the Series C Preferred Shares of certain
rights or warrants to subscribe for or purchase Series C Preferred Shares at a
price, or securities convertible into Series C Preferred Shares with a
conversion price, less than the then current market price of the Series C
Preferred Shares or (iii) upon the distribution to holders of the Series C
Preferred Shares of evidences of indebtedness or assets (excluding regular
periodic cash dividends paid out of earnings or retained earnings or dividends
payable in Series C Preferred Shares) or of subscription rights or warrants
(other than those referred to above).
The number of outstanding Class A Common Stock Rights and the number of one
one-hundredth of a Preferred Share issuable upon exercise of each Right are also
subject to adjustment in the event of a stock split of the Class A Common Shares
or a stock dividend on the Class A Common Shares payable in Class A Common
Shares or subdivisions, consolidations or combinations of the Class A Common
Shares occurring, in any such case, prior to the Distribution Date.
Series C Preferred Shares purchasable upon exercise of the Class A Common Stock
Rights will not be redeemable. Each Preferred Share will be entitled to a
quarterly dividend payment of 100 times the dividend declared per Class A Common
Share. In the event of liquidation, the holders of the Series C Preferred Shares
will be entitled to an aggregate payment of 100 times the aggregate payment made
per Class A Common Share. Each Preferred Share will have 10 votes, voting
together with the Class A Common Shares. In the event of any merger,
consolidation or other transaction in which Class A Common Shares are exchanged,
each Preferred Share will be entitled to receive 100 times the amount received
per Class A Common Share. These rights are protected by customary antidilution
provisions.
Because of the nature of the Series C Preferred Shares' dividend, liquidation
and voting rights, the value of the one one-hundredth interest in a Preferred
Share purchasable upon exercise of each Right should approximate the value of
one Class A Common Share.
From and after the occurrence of an event described in Section 11(a)(ii) of the
Rights Agreement, if the Class A Common Stock Rights evidenced by this Series C
Right Certificates are or were at any time on or after the earlier of (x) the
date of such event and (y) the Distribution Date (as such term is defined in the
Rights Agreement) acquired or beneficially owned by an Acquiring Person or an
Associate or Affiliate of an Acquiring Person (as such terms are defined in the
Rights Agreement), such Class A Common Stock Rights shall become void, and any
holder of such Class A Common Stock Rights shall thereafter have no right to
exercise such Class A Common Stock Rights.
In the event that, at any time after a Person becomes an Acquiring Person, the
Company is acquired in a merger or other business combination transaction or 50%
or more of its consolidated assets or earning power are sold, proper provision
will be made so that each holder of a Right will thereafter have the right to
receive, upon the exercise thereof at the then current exercise price of the
Right, that number of shares of common stock of the acquiring company which at
the time of such transaction will have a market value of two times the exercise
price of the Right. In the event that any person becomes an Acquiring Person,
proper provision shall be made so that each holder of a Right, other than Class
A Common Stock Rights beneficially owned by the Acquiring Person and its
Affiliates and Associates (which will thereafter be void), will thereafter have
the right to receive upon exercise that number of Class A Common Shares having a
market value of two times the exercise price of the Right. If the Company does
not have sufficient Class A Common Shares to satisfy such obligation to issue
Class A Common Shares, or if the Board of Directors so elects, the Company shall
deliver upon payment of the exercise price of a Right an amount of cash or
securities equivalent in value to the Class A Common Shares issuable upon
exercise of a Right; provided that, if the Company fails to meet such obligation
within 30 days following
E-2
the later of (x) the first occurrence of an event triggering the right to
purchase Class A Common Shares and (y) the date on which the Company's right to
redeem the Class A Common Stock Rights expires, the Company must deliver, upon
exercise of a Right but without requiring payment of the exercise price then in
effect, Class A Common Shares (to the extent available) and cash equal in value
to the difference between the value of the Class A Common Shares otherwise
issuable upon the exercise of a Right and the exercise price then in effect. The
Board of Directors may extend the 30-day period described above for up to an
additional 60 days to permit the taking of action that may be necessary to
authorize sufficient additional Class A Common Shares to permit the issuance of
Class A Common Shares upon the exercise in full of the Class A Common Stock
Rights.
At any time after any Person becomes an Acquiring Person and prior to the
acquisition by any person or group of a majority of the outstanding Class A
Common Shares, the Board of Directors of the Company may exchange the Class A
Common Stock Rights (other than Class A Common Stock Rights owned by such person
or group which have become void), in whole or in part, at an exchange ratio of
one Class A Common Share per Right (subject to adjustment).
With certain exceptions, no adjustment in the Series C Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Series C Purchase Price. No fractional Series C Preferred Shares will be
issued (other than fractions which are integral multiples of one one-thousandth
of a Preferred Share, which may, at the election of the Company, be evidenced by
depositary receipts) and in lieu thereof, an adjustment in cash will be made
based on the market price of the Series C Preferred Shares on the last trading
day prior to the date of exercise.
At any time prior to the time any Person becomes an Acquiring Person, the Board
of Directors of the Company may redeem the Class A Common Stock Rights in whole,
but not in part, at a price of $0.01 per Right (the "Redemption Price"). The
redemption of the Class A Common Stock Rights may be made effective at such
time, on such basis and with such conditions as the Board of Directors in its
sole discretion may establish. Immediately upon any redemption of the Class A
Common Stock Rights, the right to exercise the Class A Common Stock Rights will
terminate and the only right of the holders of Class A Common Stock Rights will
be to receive the Redemption Price.
The terms of the Class A Common Stock Rights may be amended by the Board of
Directors of the Company without the consent of the holders of the Class A
Common Stock Rights, except that from and after such time as any person becomes
an Acquiring Person no such amendment may adversely affect the interests of the
holders of the Class A Common Stock Rights (other than the Acquiring Person and
its Affiliates and Associates).
Until a Right is exercised, the holder thereof, as such, will have no rights as
a stockholder of the Company, including, without limitation, the right to vote
or to receive dividends.
A copy of the Rights Agreement will be filed with the Securities and Exchange
Commission as an Exhibit to a Registration Statement on Form 8-A. A copy of the
Rights Agreement is available free of charge from the Company. This summary
description of the Class A Common Stock Rights does not purport to be complete
and is qualified in its entirety by reference to the Rights Agreement, which is
hereby incorporated herein by reference.
E-3