SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
AMERICAN AXLE & MANUFACTURING
HOLDINGS, INC.
DELAWARE | 36-3161171 | |
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(State of incorporation or organization) | (I.R.S. Employer Identification No.) | |
1840 HOLBROOK AVENUE, | ||
DETROIT, MICHIGAN | 48212-3488 | |
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(Address of principal executive offices) | (Zip Code) |
If this form relates to the registration of a class of securities pursuant to Section 12(b) of the Exchange Act and is effective pursuant to General Instruction A.(c), check the following box o
If this form relates to the registration of a class of securities pursuant to Section 12(g) of the Exchange Act and is effective pursuant to General Instruction A .(d), check the following box x
Securities Act registration statement file number to which the form relates: (if applicable).
Securities to be registered pursuant to Section 12(b) of the Act:
Title Of Each Class
Name of Each Exchange On Which
To Be So Registered
Each Class Is To Be Registered
Securities to be registered pursuant to Section 12(g) of the Act:
PREFERRED SHARE PURCHASE RIGHTS
SIGNATURE | ||||||||
Rights Agreement, dated as of 09/15/03 | ||||||||
Press Release dated 9/15/03 |
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ITEM 1. DESCRIPTION OF REGISTRANTS SECURITIES TO BE REGISTERED
On September 15, 2003 the Board of Directors of American Axle & Manufacturing Holdings, Inc. (the Company) declared a dividend of one preferred share purchase right (a Right) for each outstanding share of common stock, par value $.01 per share of the Company (the Common Stock). The dividend is payable on September 25, 2003 (the Record Date) to the stockholders of record on that date. Each Right entitles the registered holder to purchase from the Company one one-thousandth of a share of Series A Junior Participating Preferred Stock, par value $.01 per share (the Preferred Stock) of the Company at a price of $120.00 per one one-thousandth of a share of Preferred Stock (as the same may be adjusted, the Purchase Price). The description and terms of the Rights are set forth in a Rights Agreement dated as of September 15, 2003 (as the same may be amended from time to time, the Rights Agreement), between the Company and EquiServe Trust Company, N.A., as Rights Agent (the Rights Agent).
Until the close of business on the earlier of (i) the tenth day after the first date of a public announcement that a person or group of affiliated or associated persons (an Acquiring Person) have acquired beneficial ownership of 15% or more of the outstanding shares of Common Stock 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 or group of affiliated persons becomes an Acquiring Person) after the date of commencement of, or the first public announcement of an intention to commence, 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 the outstanding shares of Common Stock (the earlier of such dates being called the Distribution Date), the Rights will be evidenced by the Common Stock certificates. The Rights Agreement does not restrict any person who beneficially owns 15% or more of the Common Stock as of the date of the Rights Agreement so long as such person does not become the beneficial owner of additional shares of Common Stock representing 2% or more of the outstanding shares of Common Stock.
The Rights Agreement provides that, until the Distribution Date (or earlier redemption or expiration of the Rights), the Rights will be transferable only in connection with the transfer of Common Stock. Until the Distribution Date (or earlier redemption or expiration of the Rights), the surrender for transfer of any certificates for shares of Common Stock outstanding as of the Record Date, even without a notation incorporating the Rights Agreement by reference or a copy of this Summary of Rights, will also constitute the transfer of the Rights associated with the shares of Common Stock represented by such certificate. As soon as practicable following the Distribution Date, separate certificates evidencing the Rights (Right Certificates) will be mailed to holders of record of the Common Stock as of the close of business on the Distribution Date and such separate Right Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date. The Rights will expire on September 15, 2013 (the Final Expiration Date), unless the Final Expiration Date is extended or unless the Rights are earlier redeemed or exchanged by the Company, in each case as described below.
The Purchase Price payable, and the number of shares of Preferred Stock or other securities or property issuable, upon exercise of the Rights are subject to adjustment from time to
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time to prevent dilution (i) in the event of a stock dividend on, or a subdivision, combination or reclassification of, the Preferred Stock, (ii) upon the grant to holders of the Preferred Stock of certain rights or warrants to subscribe for or purchase Preferred Stock at a price, or securities convertible into Preferred Stock with a conversion price, less than the then-current market price of the Preferred Stock or (iii) upon the distribution to holders of the Preferred Stock of evidences of indebtedness or assets (excluding regular periodic cash dividends or dividends payable in Preferred Stock) or of subscription rights or warrants (other than those referred to above).
The Rights are also subject to adjustment in the event of a stock dividend on the Common Stock payable in shares of Common Stock or subdivisions, consolidations or combinations of the Common Stock occurring, in any such case, prior to the Distribution Date.
Shares of Preferred Stock purchasable upon exercise of the Rights will not be redeemable. Each share of Preferred Stock will be entitled, when, as and if declared, to a minimum preferential quarterly dividend payment of the greater of (a) $1 per share and (b) an amount equal to 1,000 times the dividend declared per share of Common Stock. In the event of liquidation, dissolution or winding up of the Company, the holders of the Preferred Stock will be entitled to a minimum preferential liquidation payment of $100 per share (plus any accrued but unpaid dividends) but will be entitled to an aggregate 1,000 times the payment made per share of Common Stock. Each share of Preferred Stock will have 1,000 votes, voting together with the Common Stock. Finally, in the event of any merger, consolidation or other transaction in which shares of Common Stock are converted or exchanged, each share of Preferred Stock will be entitled to receive 1,000 times the amount received per share of Common Stock. These rights are protected by customary antidilution provisions.
Because of the nature of the Preferred Stocks dividend, liquidation and voting rights, the value of the one one-thousandth interest in a share of Preferred Stock purchasable upon exercise of each Right should approximate the value of one share of Common Stock.
In the event that any person or group of affiliated or associated persons becomes an Acquiring Person, each holder of a Right, other than Rights beneficially owned by the Acquiring Person (which will thereupon become void), will thereafter have the right to receive upon exercise of a Right and payment of the Purchase Price, that number of shares of Common Stock having a market value of two times the Purchase Price.
In the event that, after a person or group has become 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 (other than Rights beneficially owned by an Acquiring Person which will have become void) 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 person with whom the Company has engaged in the foregoing transaction (or its parent), which number of shares at the time of such transaction will have a market value of two times the Purchase Price.
At any time after any person or group becomes an Acquiring Person and prior to the acquisition by such person or group of 50% or more of the outstanding shares of Common Stock or the occurrence of an event described in the prior paragraph, the Board of Directors of
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the Company may exchange the Rights (other than Rights owned by such person or group which will have become void), in whole or in part, at an exchange ratio of one share of Common Stock, or a fractional share of Preferred Stock (or of a share of a similar class or series of the Companys preferred stock having similar rights, preferences and privileges) of equivalent value, per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price will be required until cumulative adjustments require an adjustment of at least 1% in such Purchase Price. No fractional shares of Preferred Stock will be issued (other than fractions which are integral multiples of one one-thousandth of a share of Preferred Stock, 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 Stock on the last trading day prior to the date of exercise.
At any time prior to the time an Acquiring Person becomes such, the Board of Directors of the Company may redeem the Rights in whole, but not in part, at a price of $.01 per Right (the Redemption Price). The redemption of the 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 Rights, the right to exercise the Rights will terminate and the only right of the holders of Rights will be to receive the Redemption Price.
For so long as the Rights are then redeemable, the Company may, except with respect to the Redemption Price, amend the Rights Agreement in any manner. After the Rights are no longer redeemable, the Company may, except with respect to the Redemption Price, amend the Rights Agreement in any manner that does not adversely affect the interests of holders of the Rights.
Until a Right is exercised or exchanged, 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 is filed as Exhibit 4.1 to this Form 8-A and a copy of the press release relating to the adoption of the Rights Plan is filed as Exhibit 99.1 to this Form 8-A. The foregoing summary description of the Rights Agreement is qualified in its entirety by reference to such exhibits.
ITEM 2. EXHIBITS
4.1 | Agreement, dated as of September 15, 2003, between the Corporation and EquiServe Trust Company, N.A., as Rights Agent, which includes the Certificate of Designations for the Series A Junior Participating Preferred Stock as Exhibit A, the Form of Right Certificate as Exhibit B and the Summary of Rights to Purchase Preferred Shares as Exhibit C. | |
99.1 | Press Release dated September 15, 2003. |
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereto duly authorized.
AMERICAN AXLE MANUFACTURING HOLDINGS, INC. | ||||||
DATED: | September 19, 2003 | By: | /s/ Patrick S. Lancaster | |||
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Name: Patrick S. Lancaster | ||||||
Title: Vice President, Chief Administrative Officer & Secretary |
EXHIBIT INDEX
Exhibit No.
Description
4.1
Rights Agreement, dated as of September 15, 2003, between the
Corporation and EquiServe Trust Company, N.A., as Rights Agent, which
includes the Certificate of Designations for the Series A Junior
Participating Preferred Stock as Exhibit A, the Form of Right
Certificate as Exhibit B and the Summary of Rights to Purchase
Preferred Shares as Exhibit C.
99.1
Press Release dated September 15, 2003.
EXHIBIT 4.1
AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
and
EQUISERVE TRUST COMPANY, N.A.
as Rights Agent
Rights Agreement
Dated as of September 15, 2003
TABLE OF CONTENTS
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Section 1. Certain Definitions | 1 | |||
Section 2. Appointment of Rights Agent | 5 | |||
Section 3. Issuance of Right Certificates | 5 | |||
Section 4. Form of Right Certificates | 7 | |||
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. Availability of Shares of Preferred Stock | 10 | |||
Section 10. Preferred Stock Record Date | 11 | |||
Section 11. Adjustment of Purchase Price, Number and Kind of Shares and Number of Rights | 11 | |||
Section 12. Certificate of Adjusted Purchase Price or Number of Shares | 18 | |||
Section 13. Consolidation, Merger or Sale or Transfer of Assets or Earnings Power | 19 | |||
Section 14. Fractional Rights and Fractional Shares | 22 | |||
Section 15. Rights of Action | 23 | |||
Section 16. Agreement of Right Holders | 24 | |||
Section 17. Right Certificate Holder Not Deemed a Stockholder | 24 | |||
Section 18. Concerning the Rights Agent | 24 | |||
Section 19. Merger or Consolidation or Change of Name of Rights Agent | 25 | |||
Section 20. Duties of Rights Agent | 25 | |||
Section 21. Change of Rights Agent | 27 | |||
Section 22. Issuance of New Right Certificates | 28 |
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Section 23. Redemption and Termination | 28 | |||
Section 24. Exchange | 29 | |||
Section 25. Notice of Certain Events | 30 | |||
Section 26. Notices | 31 | |||
Section 27. Supplements and Amendments | 31 | |||
Section 28. Successors | 32 | |||
Section 29. Benefits of this Rights Agreement | 32 | |||
Section 30. Determinations and Actions by the Board of Directors | 32 | |||
Section 31. Severability | 32 | |||
Section 32. Governing Law | 32 | |||
Section 33. Counterparts | 33 | |||
Section 34. Descriptive Headings | 33 |
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INDEX OF DEFINED TERMS
Page | Page | |||||||||
Acquiring Person | 1 | Original Rights | 3 | |||||||
Affiliate | 2 | Person | 4 | |||||||
Associate | 2 | Preferred Stock | 4 | |||||||
Authorized Officer | 26 | Principal Party | 20 | |||||||
Beneficial Owner | 2 | Purchase Price | 8 | |||||||
Beneficial Ownership | 2 | Record Date | 1 | |||||||
beneficially own | 2 | Redemption Date | 8 | |||||||
Business Day | 3 | Redemption Price | 28 | |||||||
close of business | 3 | Right | 1 | |||||||
Common Stock | 3 | Right Certificate | 5 | |||||||
Common Stock equivalents | 13 | Rights Agent | 1 | |||||||
Company | 1 | Rights Agreement | 1 | |||||||
Current Value | 13 | Section 11(a)(ii) Trigger Date | 13 | |||||||
Distribution Date | 5 | Securities Act | 4 | |||||||
equivalent preferred shares | 14 | Security | 15 | |||||||
Exchange Act | 2 | Spread | 13 | |||||||
Exchange Ratio | 30 | Stock Acquisition Date | 4 | |||||||
Exempt Person | 4 | Subsidiary | 4 | |||||||
Expiration Date | 8 | Substitution Period | 13 | |||||||
Final Expiration Date | 8 | Summary of Rights | 5 | |||||||
invalidation time | 12 | then outstanding | 2 | |||||||
Nasdaq | 4 | TIDE Committee | 4 | |||||||
NYSE | 4 | Trading Day | 15 |
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RIGHTS AGREEMENT
Rights Agreement, dated as of September 15, 2003 (as amended, supplemented or otherwise modified from time to time, the Rights Agreement) between AMERICAN AXLE & MANUFACTURING HOLDINGS, INC., a Delaware corporation (the Company), and EquiServe Trust Company, N.A., as Rights Agent (the Rights Agent).
The Board of Directors of the Company has on September 15, 2003 authorized and declared a dividend of one preferred share purchase right (a Right) for each share of Common Stock (as defined below) of the Company outstanding as of the close of business (as defined below) on September 25, 2003 (the Record Date), each Right representing the right to purchase one one-thousandth (subject to adjustment) of a share of Preferred Stock (as defined below), upon the terms and subject to the conditions herein set forth, and the Board of Directors has further authorized and directed the issuance of one Right (subject to adjustment as provided herein) with respect to each share of Common Stock that shall become outstanding between the Record Date and the earlier of the Distribution Date and the Expiration Date (as such terms are hereinafter defined); provided, however, that Rights may be issued with respect to shares of Common Stock that shall become outstanding after the Distribution Date and prior to the Expiration Date in accordance with Section 22.
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 Rights Agreement, the following terms have the meaning indicated:
(a) Acquiring Person shall mean any Person (as defined below) who or which shall be the Beneficial Owner (as defined below) of 15% or more of the shares of Common Stock then outstanding, but shall not include an Exempt Person (as defined below); provided, however, that if the Board of Directors of the Company determines in good faith that a Person who would otherwise be an Acquiring Person has become such inadvertently (including, without limitation, because (A) such Person was unaware that it beneficially owned a percentage of Common Stock that would otherwise cause such Person to be an Acquiring Person or (B) such Person was aware of the extent of its Beneficial Ownership of Common Stock but had no actual knowledge of the consequences of such Beneficial Ownership under this Rights Agreement) and without any intention of changing or influencing control of the Company, then such Person shall not be deemed to be or to have become an Acquiring Person for any purposes of this Rights Agreement unless and until such Person shall have failed to divest itself, as soon as practicable, if the Company so requests, of Beneficial Ownership of a sufficient number of shares of Common Stock so that such Person would no longer otherwise qualify as an Acquiring Person. Notwithstanding the foregoing: (i) if as of the date hereof, any Person is the Beneficial Owner of 15% or more of the shares of Common Stock then outstanding such Person shall not be deemed to be or to become an Acquiring Person unless and until such time as such Person shall (A) after the date hereof become the Beneficial Owner of additional shares of Common Stock representing 2% or more of the then-outstanding shares of Common Stock as of the date hereof (other than pursuant to a dividend or distribution paid or made by the
Company on the outstanding Common Stock or pursuant to a split or subdivision of the outstanding Common Stock) and (B) upon becoming the Beneficial Owner of such additional shares of Common Stock referred to in clause (A), such Person is then the Beneficial Owner of 15% or more of the shares of Common Stock then outstanding; and (ii) no Person shall be deemed an Acquiring Person as the result of an acquisition of shares of Common Stock 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 shares of Common Stock then outstanding; provided, however, that if a Person shall become the Beneficial Owner of 15% or more of the shares of Common Stock then outstanding by reason of such share acquisitions by the Company referred to in this clause (ii) and thereafter becomes the Beneficial Owner of any additional shares of Common Stock (other than pursuant to a dividend or distribution paid or made by the Company on the outstanding Common Stock or pursuant to a split or subdivision of the outstanding Common Stock), then such Person shall be deemed to be an Acquiring Person, subject to the proviso set forth in the first sentence of this Section 1(a), unless upon the consummation of the acquisition of such additional shares of Common Stock such Person does not beneficially own 15% or more of the shares of Common Stock then outstanding. The phrase then outstanding, when used with reference to a Persons 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.
(b) Affiliate and Associate shall have the respective meanings ascribed to such terms in Rule 12b-2 of the General Rules and Regulations under the Securities Exchange Act of 1934, as amended (the Exchange Act), as in effect on the date of this Rights Agreement.
(c) A Person shall be deemed the Beneficial Owner of, shall be deemed to have Beneficial Ownership of and shall be deemed to beneficially own any securities:
(i) which such Person or any of such Persons Affiliates or Associates is deemed to beneficially own, directly or indirectly, within the meaning of Rule 13d-3 of the General Rules and Regulations under the Exchange Act as in effect on the date of this Rights Agreement; |
(ii) which such Person or any of such Persons 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 the Beneficial Owner of, or to beneficially own, (x) securities tendered pursuant to a tender or exchange offer made by or on behalf of such Person or any of such Persons Affiliates or Associates until such tendered securities are accepted for purchase or exchange, (y) securities which such Person has a right to acquire on the exercise of Rights at any time prior to the time a Person becomes an Acquiring Person or (z) securities issuable upon exercise of Rights from and after the time a Person becomes an Acquiring Person if such Rights were acquired by such Person or any of such Persons Affiliates or Associates |
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prior to the Distribution Date or pursuant to Section 3 or Section 22 hereof (the Original Rights) or pursuant to Section 11(i) or Section 11(n) with respect to an adjustment to the Original Rights; or (B) the right to vote pursuant to any agreement, arrangement or understanding, written or otherwise; provided, however, that a Person shall not be deemed the Beneficial Owner of, or to beneficially own, any security by reason of such agreement, arrangement or understanding 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 (or any Affiliate or Associate thereof) with which such Person or any of such Persons 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 this Section 1(c)(ii)(B)) or disposing of such securities of the Company; |
provided, however, that (x) no Person who is an officer, director, or employee of an Exempt Person shall be deemed, solely by reason of such Persons status or authority as such, to be the Beneficial Owner of, to have Beneficial Ownership of or to beneficially own any securities that are beneficially owned (as defined in this Section 1(c)), including, without limitation, in a fiduciary capacity, by an Exempt Person or by any other such officer, director or employee of an Exempt Person; (y) a Person shall not be deemed the Beneficial Owner of, to have Beneficial Ownership of or to beneficially own, shares of Common Stock (or securities convertible into, exchangeable into or exercisable for Common Stock) held by such Person in trust accounts, managed accounts and the like, or otherwise held in a fiduciary capacity, that are Beneficially Owned by third Persons who are not Affiliates or Associates of such Person.
(d) Business Day shall mean any day other than a Saturday, a Sunday, or a day on which banking institutions in the State of New York, or the State in which the principal office of the Rights Agent is located, are authorized or obligated by law or executive order to close.
(e) close of business on any given date shall mean 5:00 P.M., Eastern time, on such date; provided, however, that if such date is not a Business Day it shall mean 5:00 P.M., Eastern time, on the next succeeding Business Day.
(f) Common Stock when used with reference to the Company shall mean the common stock, par value $.01, of the Company. Common Stock when used with reference to any Person other than the Company shall mean the capital stock (or, in the case of an unincorporated entity, the equivalent 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.
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(g) Exempt Person shall mean (i) Richard E. Dauch, members of his immediate family, any trust or other estate in which such person has a substantial beneficial interest and any relative or spouse of such person, or any relative of such spouse, who has the same home as such person (each, a Dauch Holder), provided, however, each Dauch Holder shall cease to be an Exempted Person in the event Richard E. Dauch ceases to be the Chief Executive Officer of the Company (such event, a Dauch Termination Event) and (ii) the Company, any Subsidiary (as defined below) of the Company, in each case including, without limitation, in its fiduciary capacity, or any employee benefit plan of the Company or of any Subsidiary of the Company or any entity or trustee holding Common Stock for or pursuant to the terms of any such plan or for the purpose of funding any such plan or funding other employee benefits for employees of the Company or of any Subsidiary of the Company. Notwithstanding clause (i) of this definition, a Dauch Holder shall not be deemed to be an Acquiring Person if at the time of a Dauch Termination Event such Person is the Beneficial Owner of 15% or more of the shares of Common Stock then outstanding unless and until such time as such Person shall (A) after the Dauch Termination Event become the Beneficial Owner of additional shares of Common Stock representing 2% or more of the then-outstanding shares of Common Stock as of the date of the Dauch Termination Event (other than pursuant to a dividend or distribution paid or made by the Company on the outstanding Common Stock or pursuant to a split or subdivision of the outstanding Common Stock) and (B) upon becoming the Beneficial Owner of such additional shares of Common Stock referred to in clause (A), such Person is then the Beneficial Owner of 15% or more of the shares of Common Stock then outstanding.
(h) Independent Director means a member of the Board of Directors of the Company, (i) who is not, and during the past three years has not been, an officer or employee of the Company, and (ii) who is not (A) an Acquiring Person or an Affiliate or Associate of an Acquiring Person or (B) a Person who shall have made a proposal to the Company or its shareholders, or taken any other action that, if effective, could cause such Person to become an Acquiring Person hereunder, or an Affiliate or Associate of any such Person.
(i) Nasdaq shall mean The Nasdaq Stock Markets National Market.
(j) NYSE shall mean The New York Stock Exchange.
(k) Person shall mean any individual, firm, corporation, partnership, limited liability company, trust or other entity, and shall include any successor (by merger or otherwise) of such entity.
(l) Preferred Stock shall mean the Series A Junior Participating Preferred Stock, par value $.01 per share, of the Company having the rights and preferences set forth in the Form of Certificate of Designations attached to this Rights Agreement as Exhibit A.
(m) Securities Act shall mean the Securities Act of 1933, as amended.
(n) Stock Acquisition Date shall mean the first date of public announcement
(which for purposes of this definition shall include, without limitation, a
report filed pursuant to Section 13(d) of the Exchange Act) by the Company or
an Acquiring Person that an Acquiring
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Person has become such or such earlier date as a majority of the Board of
Directors shall become aware of the existence of an Acquiring Person.
(o) Subsidiary of any Person 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
such Person, and any corporation or other entity that is otherwise controlled
by such Person.
(p) TIDE Committee shall mean the committee comprised of Independent
Directors selected by the Board of Directors as set forth in Section 23 hereof.
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 Common Stock) in accordance with the terms and
conditions hereof, and the Rights Agent hereby accepts such appointment. The
Company may from time to time appoint such co-Rights Agents as it may deem
necessary or desirable upon ten (10) days prior notice to the Rights Agent.
The Rights Agent shall have no duty to supervise, and shall in no event be
liable for the acts or omissions of any such co-Rights Agent.
Section 3. Issuance of Right Certificates. (a) Until the close of
business on the earlier of (i) the tenth day after the Stock Acquisition Date
or (ii) the tenth Business Day (or such later date as may be determined by
action of the Board of Directors prior to such time as any Person becomes an
Acquiring Person) after the date of the commencement by any Person (other than
an Exempt Person) of, or of the first public announcement of the intention of
such Person (other than an Exempt Person) to commence, a tender or exchange
offer the consummation of which would result in any Person (other than an
Exempt Person) becoming the Beneficial Owner of 15% or more of the shares of
Common Stock then outstanding (including, in the case of both clause (i) and
(ii), any such date which is after the date of this Rights Agreement and prior
to the issuance of the Rights) (the earlier of such dates 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 Stock
registered in the names of the holders thereof, and not by separate Right
Certificates (as defined below), and (y) the Rights will be transferable only
in connection with the transfer of Common Stock. 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 record holder of Common Stock as of the close of business on the
Distribution Date (other than any Acquiring Person or any Associate or
Affiliate of an Acquiring Person), at the address of such holder shown on the
records of the Company, a Right Certificate, in substantially the form of
Exhibit B hereto (a Right Certificate), evidencing one Right (subject to
adjustment as provided herein) for each share of Common Stock so held. As of
and after the Distribution Date, the Rights will be evidenced solely by such
Right Certificates.
(b) As promptly as practicable following the Record Date, the Company will
send a copy of a Summary of Rights to Purchase Shares of Preferred Stock, in
substantially the form of Exhibit C hereto (the Summary of Rights), by
first-class, postage-prepaid mail, to each
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record holder of Common Stock as of
the close of business on the Record Date (other than any Acquiring Person or
any Associate or Affiliate of any Acquiring Person), at the address of such
holder shown on the records of the Company. With respect to shares of Common
Stock outstanding as of the Record Date, until the Distribution Date, the
Rights associated with such shares will be evidenced by the share certificate
for such shares of Common Stock registered in the names of the holders thereof
together with the Summary of Rights. Until the Distribution Date (or, if
earlier, the Expiration Date), the surrender for transfer of any certificate
for Common Stock outstanding on the Record Date, with or without a copy of the
Summary of Rights, shall also constitute the transfer of the Rights associated
with the Common Stock represented thereby.
(c) Rights shall be issued in respect of all shares of Common Stock issued
or disposed of (including, without limitation, upon disposition of Common Stock
out of treasury stock or issuance or reissuance of Common Stock out of
authorized but unissued shares) after the Record Date but prior to the earlier
of the Distribution Date and the Expiration Date, or in certain circumstances
provided in Section 22 hereof, after the Distribution Date. Certificates issued
for Common Stock (including, without limitation, upon transfer of outstanding
Common Stock, disposition of Common Stock out of treasury stock or issuance or
reissuance of Common Stock out of authorized but unissued shares) after the
Record Date but prior to the earlier of the Distribution Date and the
Expiration Date shall have impressed on, printed on, written on or otherwise
affixed to them the following legend:
With respect to such certificates containing the foregoing legend, until the
Distribution Date, the Rights associated with the Common Stock represented by
such certificates shall be evidenced by such certificates alone, and the
surrender for transfer of any such certificate, except as otherwise
provided herein, shall also constitute the transfer of the Rights associated
with the Common Stock represented thereby. In the event that the Company
purchases or otherwise acquires any Common Stock after the Record Date but
prior to the Distribution Date, any Rights associated
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with such Common Stock
shall be deemed cancelled and retired so that the Company shall not be entitled
to exercise any Rights associated with the shares of Common Stock which are no
longer outstanding.
Notwithstanding this paragraph (c), the omission of a legend shall not
affect the enforceability of any part of this Rights Agreement or the rights of
any holder of the Rights.
Section 4. Form of Right Certificates. The Right Certificates (and the
forms of election to purchase shares and of assignment to be printed on the
reverse thereof) shall be substantially in the form set forth in Exhibit B
hereto and may have such marks of identification or designation and such
legends, summaries or endorsements printed thereon as the Company may deem
appropriate and as are not inconsistent with the provisions of this Rights
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 NYSE
or of any other stock exchange or automated quotation system on which the
Rights may from time to time be listed, or to conform to usage. Subject to the
provisions of Sections 11 and 22 hereof, the Right Certificates shall entitle
the holders thereof to purchase such number of one one-thousandths of a share
of Preferred Stock as shall be set forth therein at the Purchase Price (as
determined pursuant to Section 7), but the amount and type of securities
purchasable upon the exercise of each Right and the Purchase Price thereof
shall be subject to adjustment as provided herein.
Section 5. Countersignature and Registration. (a) The Right Certificates
shall be executed on behalf of the Company by the Chief Executive Officer, the
President, any of the Vice Presidents or the Treasurer of the Company, either
manually or by facsimile signature, shall have affixed thereto the Companys
seal or a facsimile thereof and shall be attested by the Secretary or an
Assistant Secretary of the Company, either manually or by facsimile signature.
The Right Certificates shall be countersigned by the Rights Agent, either
manually or by facsimile signature, and shall not be valid for any purpose
unless countersigned. In case any officer of the Company who shall have signed
any of the Right Certificates shall cease to be such officer of the Company
before countersignature by the Rights Agent and issuance and delivery by the
Company, such Right Certificates, nevertheless, may be countersigned by the
Rights Agent 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.
(b) Following the Distribution Date, the Rights Agent will keep or cause to be
kept, at an office or agency designated for such purpose, books for
registration and transfer of the Right Certificates issued hereunder. Such books shall show the names and
addresses of the respective holders of the Right Certificates, the number of
Rights evidenced on its face by each of the Right Certificates and the date of
each of the Right Certificates.
Section 6. Transfer, Split Up, Combination and Exchange of Right
Certificates; Mutilated, Destroyed, Lost or Stolen Right Certificates. (a)
Subject to the provisions of this Rights Agreement, at any time after the close
of business on the Distribution Date, and prior to
-7-
the close of business on the Expiration Date, any Right Certificate or Right Certificates may be
transferred, split up, combined or exchanged for another Right Certificate or
Right Certificates, entitling the registered holder to purchase a like number
of one one-thousandths of a share of Preferred Stock (or, following such time,
other securities, cash or assets as the case may be) 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 office
or agency of the Rights Agent designated for such purpose. Thereupon the
Rights Agent, subject to the provisions of this Rights Agreement, 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 to cover any tax or governmental charge
that may be imposed in connection with any transfer, split up, combination or
exchange of Right Certificates.
(b) Subject to the provisions of this Rights Agreement, at any time after
the Distribution Date and prior to the Expiration Date, upon receipt by the
Company and the Rights Agent of evidence reasonably satisfactory to them of the
loss, theft, destruction or mutilation of a Right Certificate, and, in case of
loss, theft or destruction, of indemnity or security reasonably satisfactory to
them, and, at the Companys 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) Except as otherwise provided herein, the Rights shall become exercisable
on the Distribution Date, and thereafter the registered holder of any Right
Certificate may, subject to Section 11(a)(ii) hereof and except as otherwise
provided herein, exercise the Rights evidenced thereby in whole or in part 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 the office or
agency of the Rights Agent designated for such purpose, together with payment
of the Purchase Price for each one one-thousandth of a share of Preferred Stock
(or other securities, cash or assets, as the case may be) as to which the
Rights are exercised, at any time which is both after the Distribution Date and
prior to the time (the Expiration Date) that is the earliest of (i) the close
of business on September 15, 2013 (the Final Expiration Date), (ii) the
time at which the Rights are redeemed as provided in Section 23 hereof (the
Redemption Date) or (iii) the time at which such Rights are exchanged as
provided in Section 24 hereof.
(b) The purchase price (the Purchase Price) shall be initially $120.00
for each one one-thousandth of a share of Preferred Stock purchasable upon the
exercise of a Right. The Purchase Price and the number of one one-thousandths
of a share of Preferred Stock or other securities or property to be acquired
upon exercise of a Right 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) of this Section
7.
-8-
(c) Except as otherwise provided herein, upon receipt of a Right
Certificate representing exercisable Rights, with the form of election to
purchase duly executed, accompanied by payment of the aggregate Purchase Price
for the number of shares of Preferred Stock 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 6 hereof, in cash or by certified check,
cashiers 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 Preferred Stock certificates for the number of shares of Preferred Stock to
be purchased (and the Company hereby irrevocably authorizes its transfer agent
to comply with all such requests), or (B) requisition from the depositary agent
appointed by the Company depositary receipts representing interests in such
number of one one-thousandths of a share of Preferred Stock as are to be
purchased, in which case certificates for the Preferred Stock 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 shares in accordance with
Section 14 hereof, (iii) promptly 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,
promptly deliver such cash to or upon the order of the registered holder of
such Right Certificate.
(d) Except as otherwise provided herein, 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
exercisable 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 Rights Agreement to the contrary,
neither the Rights Agent nor the Company shall be obligated to undertake any
action with respect to a registered holder of Rights upon the occurrence of any
purported transfer or exercise of Rights pursuant to Section 6 hereof or this
Section 7 unless such registered holder shall have (i) completed and signed the
certificate contained in the form of assignment or election to purchase set
forth on the reverse side of the Right Certificate surrendered for such
transfer or exercise and (ii) provided such additional evidence of the identity
of the Beneficial Owner (or former Beneficial Owner) 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 cancelled form, or,
if surrendered to the Rights Agent, shall be cancelled 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 cancelled Right Certificates to the Company, or shall, at the
written request of the Company, destroy or cause to be destroyed such cancelled
Right Certificates, and in such case shall deliver a certificate of destruction
thereof to the Company.
-9-
Section 9. Availability of Shares of Preferred Stock. (a) The Company
covenants and agrees that it will cause to be reserved and kept available out
of its authorized and unissued shares of Preferred Stock or any shares of
Preferred Stock held in its treasury, the number of shares of Preferred Stock
that will be sufficient to permit the exercise in full of all outstanding
Rights.
(b) So long as the shares of Preferred Stock (and, following the time that
a Person becomes an Acquiring Person, shares of Common Stock and other
securities) issuable upon the exercise of Rights may be listed or admitted to
trading on NYSE or listed on any other national securities exchange or
quotation system, the Company shall use its best efforts to cause, from and
after such time as the Rights become exercisable, all shares reserved for such
issuance to be listed or admitted to trading on NYSE or listed on any other
exchange or quotation system upon official notice of issuance upon such
exercise.
(c) From and after such time as the Rights become exercisable, the Company
shall use its best efforts, if then necessary to permit the issuance of shares
of Preferred Stock (and following the time that a Person first becomes an
Acquiring Person, shares of Common Stock and other securities) upon the
exercise of Rights, to register and qualify such shares of Preferred Stock (and
following the time that a Person first becomes an Acquiring Person, shares of
Common Stock and other securities) under the Securities Act and any applicable
state securities or Blue Sky laws (to the extent exemptions therefrom are not
available), cause such registration statement and qualifications to become
effective as soon as possible after such filing and keep such registration and
qualifications effective until the earlier of (x) the date as of which the
Rights are no longer exercisable for such securities and (y) the Expiration
Date. The Company may temporarily suspend, for a period of time not to exceed
ninety (90) days, the exercisability of the Rights in order to prepare and file
a registration statement under the Securities Act and permit it to become
effective. Upon any such suspension, the Company shall issue a public
announcement stating that the exercisability of the Rights has been temporarily
suspended, as well as a public announcement at such time as the suspension is
no longer in effect. Notwithstanding any provision of this Rights Agreement to
the contrary, the Rights shall not be exercisable in any jurisdiction unless
the requisite qualification or exemption in such jurisdiction shall have been
obtained and until a registration statement under the Securities Act (if
required) shall have been declared effective.
(d) The Company covenants and agrees that it will take all such action as may
be necessary to ensure that all shares of Preferred Stock (and, following the
time that a Person becomes an Acquiring Person, shares of Common Stock and other securities)
delivered upon exercise of Rights shall, at the time of delivery of the
certificates therefor (subject to payment of the Purchase Price), be duly and
validly authorized and issued and fully paid and nonassessable shares.
(e) The Company further covenants and agrees that it will pay when due and
payable any and all federal and state transfer taxes and charges which may be
payable in respect of the issuance or delivery of the Right Certificates or of
any shares of Preferred Stock (or shares of Common Stock or other securities)
upon the exercise of Rights. The Company shall not, however, be required to
pay any transfer tax or charge 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
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certificates or depositary receipts for the Preferred Stock (or
shares of Common Stock or other securities) in a name other than that of, the
registered holder of the Right Certificate evidencing Rights surrendered for
exercise or to issue or deliver any certificates or depositary receipts for
Preferred Stock (or shares of Common Stock or other securities) upon the
exercise of any Rights until any such tax or charge shall have been paid (any
such tax or charge being payable by that holder of such Right Certificate at
the time of surrender) or until it has been established to the Companys
reasonable satisfaction that no such tax or charge is due.
Section 10. Preferred Stock Record Date. Each Person in whose name any
certificate for Preferred Stock is issued upon the exercise of Rights shall for
all purposes be deemed to have become the holder of record of the shares of
Preferred Stock represented thereby on, and such certificate shall be dated,
the date upon which the Right Certificate evidencing such Rights was duly
surrendered and payment of the Purchase Price (and any applicable transfer
taxes or charges) was made; provided, however, that if the date of such
surrender and payment is a date upon which the Preferred Stock transfer books
of the Company are closed, such Person shall be deemed to have become the
record holder of such shares on, and such certificate shall be dated, the next
succeeding Business Day on which such transfer books are open. Prior to the
exercise of the Rights evidenced thereby, the holder of a Right Certificate
shall not be entitled to any rights of a holder of Preferred Stock for which
the Rights shall be exercisable, including, without limitation, the right to
vote or to receive dividends or other distributions, and shall not be entitled
to receive any notice of any proceedings of the Company, except as provided
herein.
Section 11. Adjustment of Purchase Price, Number and Kind of Shares and
Number of Rights. The Purchase Price, the number of shares of Preferred Stock
or other securities or property purchasable upon exercise of 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 Preferred Stock payable in shares of
Preferred Stock, (B) subdivide the outstanding shares of Preferred Stock, (C)
combine the outstanding shares of Preferred Stock into a smaller number of
shares of Preferred Stock or (D) issue any shares of its capital stock in a
reclassification of the shares of Preferred Stock (including any such
reclassification in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation), except as otherwise
provided in this Section 11(a), the Purchase Price in effect at the time of the
record date for such dividend or of the effective date of such subdivision,
combination or reclassification, as the case may be, 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 and at a
time when the Preferred Stock transfer books of the Company were open, the
holder 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.
-11-
-12-
-13-
(b) In case the Company shall fix a record date for the issuance of rights,
options or warrants to all holders of Preferred Stock entitling them (for a
period expiring within 45 calendar days after such record date) to subscribe
for or purchase Preferred Stock (or shares having similar rights, privileges
and preferences as the Preferred Stock (equivalent preferred shares)) or
securities convertible into Preferred Stock or equivalent preferred shares at a
price per share of Preferred Stock or equivalent preferred shares (or having a
conversion price per share, if a security convertible into shares of Preferred
Stock or equivalent preferred shares) less than the then-current per share
market price of the Preferred Stock (determined pursuant to Section 11(d)
hereof) on such record date, the Purchase Price to be in effect after such
record date shall be determined by multiplying the Purchase Price in effect
immediately prior to such record date by a fraction, the numerator of which
shall be the number of shares of Preferred Stock and equivalent preferred
shares outstanding on such record date plus the number of shares of Preferred
Stock and equivalent preferred shares which the aggregate offering price of the
total number of such 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 shares of Preferred Stock and equivalent preferred shares outstanding on
such record date plus the number of additional shares of Preferred Stock 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 and
which shall be binding on the Rights Agent. Shares of Preferred Stock and
equivalent 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 Preferred Stock (including any such
distribution made in connection with a consolidation or merger in which the
Company is the continuing or surviving corporation) of evidences of
indebtedness or assets (other than a regular quarterly cash dividend or a
dividend
-14-
payable in Preferred Stock) or subscription rights or warrants
(excluding those referred to in Section 11(b) hereof), the Purchase Price to be
in effect after such record date shall be determined by multiplying the
Purchase Price in effect immediately prior to such record date by a fraction,
the numerator of which shall be the then-current per share market price of the
Preferred Stock (determined pursuant to Section 11(d) hereof) on such record
date, less the fair market value (as determined in good faith by the Board of
Directors of the Company whose determination shall be described in a statement
filed with the Rights Agent and shall be binding on the Rights Agent) of the
portion of such assets or evidences of indebtedness so to be distributed or of
such subscription rights or warrants applicable to one share of Preferred
Stock, and the denominator of which shall be such current per share market
price of the Preferred Stock; 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 which would then be in effect if such record date had not been fixed.
(d) (i) Except as otherwise provided herein, 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 by (w)
the principal consolidated transaction reporting system with respect to
securities listed or admitted to trading on NYSE or, (x) if the Security is not
listed or admitted to trading on the NYSE, 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 (y) 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 Nasdaq or such other system then in use, or, (z) 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.
-15-
(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 not required to be made by
reason of this Section 11(e) 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 share of
Preferred Stock or share of Common Stock or 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 the earlier
of (i) three years from the date of the transaction which requires such
adjustment or (ii) the Expiration Date.
(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 the Preferred Stock,
thereafter the Purchase Price and the number of such other shares so receivable
upon exercise of a Right shall be subject to adjustment from time to time in a
manner and on terms as nearly equivalent as practicable to the provisions with
respect to the Preferred Stock contained in Section 11(a), 11(b), 11(c), 11(e),
11(h), 11(i) and 11(m) and the provisions of Sections 7, 9, 10, 13 and 14
hereof with respect to the Preferred Stock shall apply on like terms to any
such other shares.
(g) All Rights originally issued by the Company subsequent to any adjustment
made to the Purchase Price hereunder shall evidence the right to purchase, at
the adjusted Purchase Price, the number of one one-thousandths of a share of Preferred
Stock purchasable from time to time hereunder upon exercise of the Rights, all
subject to further adjustment as provided herein.
(h) Unless the Company shall have exercised its election as provided in
Section 11(i), upon each adjustment of the Purchase Price as a result of the
calculations made in Section 11(b) and (c), each Right outstanding immediately
prior to the making of such adjustment shall thereafter evidence the right to
purchase, at the adjusted Purchase Price, that number of one one-thousandths of
a share of Preferred Stock (calculated to the nearest one ten-thousandth of a
share of Preferred Stock) obtained by (i) multiplying (x) the number of one
one-thousandths of a share of Preferred Stock purchasable upon the exercise of
a Right immediately prior to such adjustment by (y) the Purchase Price in
effect immediately prior to such adjustment of the
-16-
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 pursuant to Sections 11(b) or 11(c) hereof to adjust the number
of Rights, in substitution for any adjustment in the number of one
one-thousandths of a share of Preferred Stock purchasable upon the exercise of
a Right. Each of the Rights outstanding after such adjustment of the number of
Rights shall be exercisable for the number of one one-thousandths of a share of
Preferred Stock for which a Right was exercisable immediately prior to such
adjustment. Each Right held of record prior to such adjustment of the number
of Rights shall become that number of Rights (calculated to the nearest one
ten-thousandth) obtained by dividing the Purchase Price in effect immediately
prior to adjustment of the Purchase Price by the Purchase Price in effect
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 issued, shall be at least 10 days later than the date of
the public announcement. If Right Certificates have been issued, upon each
adjustment of the number of Rights pursuant to this Section 11(i), the Company
may, 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 as a result of such adjustment. Right Certificates so to be
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-thousandths of a share of Preferred Stock issuable upon the
exercise of the Rights, the Right Certificates theretofore and thereafter
issued may continue to express the Purchase Price and the number of one
one-thousandths of a share of Preferred Stock 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 the then par value, if any, of the shares of Preferred
Stock or other shares of capital stock issuable upon exercise of the Rights,
the Company shall take any corporate action which may, in the opinion of its
counsel, be necessary in order that the Company may validly and legally issue
fully paid and nonassessable shares of Preferred Stock or other such 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 the
Preferred Stock, Common Stock or other capital stock or securities of
-17-
the Company, if any, issuable upon such exercise over and above the Preferred
Stock, Common Stock or 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 holders
right to receive such additional shares upon the occurrence of the event
requiring such adjustment.
(m) Notwithstanding anything in this Section 11 to the contrary, the
Company shall be entitled to make such adjustments in the Purchase Price, in
addition to those adjustments expressly required by this Section 11, as and to
the extent that it in its sole discretion shall determine to be advisable in
order that any consolidation or subdivision of the Preferred Stock, issuance
(wholly for cash) of any shares of Preferred Stock at less than the current
market price, issuance (wholly for cash) of Preferred Stock or securities which
by their terms are convertible into or exchangeable for Preferred Stock,
dividends on Preferred Stock payable in shares of Preferred Stock or issuance
of rights, options or warrants referred to hereinabove in Section 11(b),
hereafter made by the Company to holders of its Preferred Stock shall not be
taxable to such stockholders.
(n) Notwithstanding anything in this Rights Agreement to the contrary, in
the event that at any time after the date of this Rights Agreement and prior to
the Distribution Date, the Company shall (i) declare or pay any dividend on the
Common Stock payable in Common Stock or (ii) effect a subdivision, combination
or consolidation of the Common Stock (by reclassification or otherwise than by
payment of a dividend payable in Common Stock) into a greater or lesser number
of shares of Common Stock, then in any such case, the number of Rights
associated with each share of Common Stock then outstanding, or issued or
delivered thereafter, shall be proportionately adjusted so that the number of
Rights thereafter associated with each share of Common Stock following any such
event shall equal the result obtained by multiplying the number of Rights
associated with each share of Common Stock immediately prior to such event by a
fraction the numerator of which shall be the total number of shares of Common
Stock outstanding immediately prior to the occurrence of the event and the
denominator of which shall be the total number of shares of Common Stock
outstanding immediately following the occurrence of such event.
(o) The Company agrees that, after the earlier of the Distribution Date or the
Stock Acquisition Date, it will not, except as permitted by Sections 23, 24 or
27 hereof, take (or permit any Subsidiary to take) any action if at the time
such action is taken it is reasonably
foreseeable that such action will diminish substantially or eliminate the
benefits intended to be afforded by the Rights.
Section 12. Certificate of Adjusted Purchase Price or Number of Shares.
Whenever an adjustment is made as provided in Section 11 or 13 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 Stock or the
Preferred Stock a copy of such certificate and (c) mail a brief summary thereof
to each holder of a Right Certificate in accordance with Section 25 hereof (if
so required under Section 25 hereof). The Rights Agent shall be fully
protected in relying on any such
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certificate and on any adjustment therein
contained and shall not be deemed to have knowledge of any such adjustment
unless and until it shall have received such certificate.
Section 13. Consolidation, Merger or Sale or Transfer of Assets or
Earnings Power. (a) In the event, directly or indirectly, at any time after
any Person has become an Acquiring Person, (i) the Company shall merge with and
into any other Person, (ii) any Person shall consolidate with the Company, or
any Person shall 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 Stock shall be changed into or exchanged for
stock or other securities of any other Person (or of 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 to 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 record of a Right (other than Rights which have become void
pursuant to Section 11(a)(ii)) 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-thousandths of a share of Preferred Stock
for which a Right was exercisable (whether or not such Right was then
exercisable) immediately prior to the time that any Person first became an
Acquiring Person (each as subsequently adjusted thereafter pursuant to Section
11(a)(i), 11(b), 11(c), 11(h), 11(i) and 11(m)), in accordance with the terms
of this Rights Agreement and in lieu of Preferred Stock, such number of validly
issued, fully paid and non-assessable and freely tradeable shares of Common
Stock of the Principal Party (as defined below) not subject to any liens,
encumbrances, rights of first refusal or other adverse claims, as shall be
equal to the result obtained by (1) multiplying the then-current Purchase Price
by the number of one one-thousandths of a share of Preferred Stock for which a
Right was exercisable immediately prior to the time that any Person first
became an Acquiring Person (as subsequently adjusted thereafter pursuant to
Section 11(a)(i), 11(b), 11(c), 11(h), 11(i) and 11(m)) and (2) dividing that
product by 50% of the then-current per share market price of the Common Stock
of such Principal Party (determined pursuant to Section 11(d)(i) hereof) on the
date of consummation of such consolidation, merger, sale or transfer; provided
that the Purchase Price and the number of shares of Common Stock of such
Principal Party issuable upon exercise of each Right shall be
further adjusted as provided in Section 11(f) of this Rights Agreement to
reflect any events occurring in respect of such Principal Party after the date
of such consolidation, merger, sale or transfer;
(B) such Principal Party shall thereafter be liable for, and shall assume,
by virtue of such consolidation, merger, sale or transfer, all the obligations
and duties of the Company pursuant to this Rights Agreement;
(C) the term Company shall thereafter be deemed to refer to such
Principal Party; and
(D) such Principal Party shall take such steps (including, but not limited
to, the reservation of a sufficient number of its shares of its Common Stock)
in connection with such
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consummation of any such transaction as may be
necessary to assure that the provisions hereof shall thereafter be applicable,
as nearly as reasonably may be, in relation to the shares of its Common Stock
thereafter deliverable upon the exercise of the Rights; provided that, upon the
subsequent occurrence of any consolidation, merger, sale or transfer of assets
or other extraordinary transaction in respect of such Principal Party, each
holder of a Right shall thereupon be entitled to receive, upon exercise of a
Right and payment of the Purchase Price as provided in this Section 13(a), such
cash, shares, rights, warrants and other property which such holder would have
been entitled to receive had such holder, at the time of such transaction,
owned the Common Stock of the Principal Party receivable upon the exercise of a
Right pursuant to this Section 13(a), and such Principal Party shall take such
steps (including, but not limited to, reservation of shares of stock) as may be
necessary to permit the subsequent exercise of the Rights in accordance with
the terms hereof for such cash, shares, rights, warrants and other property.
(b) Principal Party shall mean:
provided, however, that in any such case described in the foregoing clause
(b)(i) or (b)(ii), if the Common Stock of such Person is not at such time or
has not been continuously over the preceding 12-month period registered under
Section 12 of the Exchange Act, then (1) if such Person is a direct or indirect
Subsidiary of another Person the Common Stock of which is and has been so
registered, the term Principal Party shall refer to such other Person, or (2)
if such Person is a Subsidiary, directly or indirectly, of more than one
Person, and the Common Stocks of all of such persons have been so registered,
the term Principal Party shall refer to whichever of such Persons is the
issuer of Common Stock having the greatest aggregate market value of shares
outstanding, or (3) if such Person is owned, directly or indirectly, by a joint
venture formed by two or more Persons that are not owned, directly or
indirectly, by the same Person, the
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rules set forth in clauses (1) and (2)
above shall apply to each of the owners having an interest in the venture as if
the Person owned by the joint venture was a Subsidiary of both or all of such
joint venturers, and the Principal Party in each such case shall bear the
obligations set forth in this Section 13 in the same ratio as its interest in
such Person bears to the total of such interests.
(c) The Company shall not consummate any consolidation, merger, sale or
transfer referred to in Section 13(a) hereof unless prior thereto the Company
and the Principal Party involved therein shall have executed and delivered to
the Rights Agent an agreement confirming that the requirements of Sections
13(a) and (b) hereof shall promptly be performed in accordance with their terms
and that such consolidation, merger, sale or transfer of assets shall not
result in a default by the Principal Party under this Rights Agreement as the
same shall have been assumed by the Principal Party pursuant to Sections 13(a)
and (b) hereof and providing that, as soon as practicable after executing such
agreement pursuant to this Section 13, the Principal Party will:
(d) In case the Principal Party has a provision in any of its authorized
securities or in its certificate of incorporation or by-laws or other
instrument governing its affairs, which provision would have the effect of (i)
causing such Principal Party to issue (other than to holders of Rights pursuant
to this Section 13), in connection with, or as a consequence of, the
consummation of a transaction referred to in this Section 13, shares of Common
Stock or Common Stock equivalents of such Principal Party at less than the
then-current market price per share thereof (determined pursuant to Section
11(d) hereof) or securities exercisable for, or convertible into, Common Stock
or Common Stock equivalents of such Principal Party at less
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than such then-current market price, or (ii) providing for any special payment, tax or
similar provision in connection with the issuance of the Common Stock of such
Principal Party pursuant to the provisions of Section 13, then, in such event,
the Company hereby agrees with each holder of Rights that it shall not
consummate any such transaction unless prior thereto the Company and such
Principal Party shall have executed and delivered to the Rights Agent a
supplemental agreement providing that the provision in question of such
Principal Party shall have been canceled, waived or amended, or that the
authorized securities shall be redeemed, so that the applicable provision will
have no effect in connection with, or as a consequence of, the consummation of
the proposed transaction.
(e) The Company covenants and agrees that it shall not, at any time after
a Person first becomes an Acquiring Person enter into any transaction of the
type contemplated by Sections 13(a)(i)-(iii) hereof if (x) at the time of or
immediately after such consolidation, merger, sale, transfer or other
transaction there are any rights, warrants or other instruments or securities
outstanding or agreements in effect which would substantially diminish or
otherwise eliminate the benefits intended to be afforded by the Rights, (y)
prior to, simultaneously with or immediately after such consolidation, merger,
sale, transfer or other transaction, the stockholders of the Person who
constitutes, or would constitute, the Principal Party for purposes of Section
13(b) hereof shall have received a distribution of Rights previously owned by
such Person or any of its Affiliates or Associates or (z) the form or nature of
organization of the Principal Party would preclude or limit the exercisability
of the Rights.
Section 14. Fractional Rights and Fractional Shares. (a) The Company shall
not be required to issue fractions of Rights (except prior to the Distribution
Date in accordance with Section 11(n) hereof) 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 by (w) the principal consolidated transaction reporting system with
respect to securities listed or
admitted to trading on NYSE or, (x) if the Rights are not listed or
admitted to trading on NYSE, 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, (y) 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, (z) 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.
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(b) The Company shall not be required to issue fractions of shares of
Preferred Stock (other than fractions which are integral multiples of one
one-thousandth of a share of Preferred Stock) upon exercise of the Rights or to
distribute certificates which evidence fractional shares of Preferred Stock
(other than fractions which are integral multiples of one one-thousandth of a
share of Preferred Stock). Interests in fractions of Preferred Stock in
integral multiples of one one-thousandth of a share of Preferred Stock may, at
the election of the Company, be evidenced by depositary receipts, pursuant to
an appropriate agreement between the Company and a depositary selected by it;
provided, that such agreement shall provide that the holders of such depositary
receipts shall have all the rights, privileges and preferences to which they
are entitled as beneficial owners of the Preferred Stock represented by such
depositary receipts. In lieu of fractional shares of Preferred Stock that are
not integral multiples of one one-thousandth of a share of Preferred Stock, the
Company shall pay to the registered holders of Right Certificates at the time
such Rights are exercised for shares of Preferred Stock as herein provided an
amount in cash equal to the same fraction of the current market value of one
share of Preferred Stock. For the purposes of this Section 14(b), the current
market value of a share of Preferred Stock shall be the closing price of a
share of Preferred Stock (as determined pursuant to Section 11(d)(ii) hereof)
for the Trading Day immediately prior to the date of such exercise.
(c) The Company shall not be required to issue fractions of shares of
Common Stock or to distribute certificates which evidence fractional shares of
Common Stock upon the exercise or exchange of Rights. In lieu of such
fractional shares of Common Stock, the Company shall pay to the registered
holders of the Right Certificates at the time such Rights are exercised or
exchanged for shares of Common Stock as herein provided an amount in cash equal
to the same fraction of the current market value of a whole share of Common
Stock (as determined in accordance with Section 11(d)(i) hereof) for the
Trading Day immediately prior to the date of such exercise or exchange.
(d) The holder of a Right by the acceptance of the Right expressly waives
the right to receive any fractional Rights or any fractional shares upon
exercise or exchange of a Right (except as provided above).
Section 15. Rights of Action. All rights of action in respect of this Rights
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 Stock); and any registered holder of any
Right Certificate (or, prior to the Distribution Date, of the Common Stock),
without the consent of the Rights Agent or of the holder of any other Right
Certificate (or, prior to the Distribution Date, of the Common Stock), on such
holders own behalf and for such holders own benefit, may enforce, and may
institute and maintain any suit, action or proceeding against the Company to
enforce, or otherwise act in respect of, such holders right to exercise the
Rights evidenced by such Right Certificate (or, prior to the Distribution Date,
such Common Stock) in the manner provided in such Right Certificate and in this
Rights 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 Rights
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 Rights Agreement.
-23-
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:
Section 17. Right Certificate Holder Not Deemed a Stockholder. No holder, as
such, of any Right Certificate shall be entitled to vote, receive dividends or
be deemed for any purpose the holder of the Preferred Stock or any other
securities of the Company which may at any time be issuable on the exercise or
exchange 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 this Rights Agreement), or to receive
dividends or subscription rights, or otherwise, until the Rights
evidenced by such Right Certificate shall have been exercised or exchanged
in accordance with the provisions hereof.
Section 18. Concerning the Rights Agent. (a) The Company agrees to pay
to the Rights Agent reasonable compensation for all services rendered by it
hereunder and, from time to time, on demand of the Rights Agent, its reasonable
expenses and counsel fees and other disbursements incurred in the
administration and execution of this Rights 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 Rights Agreement,
including the costs and expenses of defending against any claim of liability
arising therefrom, directly or indirectly.
(b) The Rights Agent shall be protected and shall incur no liability for,
or in respect of any action taken, suffered or omitted by it in connection
with, its administration of this Rights Agreement in reliance upon any Right
Certificate or certificate for the Preferred Stock or Common Stock or for other
securities of the Company, instrument of assignment or
transfer,
-24-
power of attorney, endorsement, affidavit, letter, notice, direction, consent,
certificate, statement, or other paper or document reasonably believed by it to
be genuine and to be signed, executed and, where necessary, verified or
acknowledged, by the proper Person or Persons, or otherwise upon the advice of
counsel as set forth in Section 20 hereof.
Section 19. Merger or Consolidation or Change of Name of Rights Agent.
(a) Any corporation into which the Rights Agent or any successor Rights Agent
may be merged or with which it may be consolidated, or any corporation
resulting from any merger or consolidation to which the Rights Agent or any
successor Rights Agent shall be a party, or any corporation succeeding to the
stock transfer or corporate trust powers of the Rights Agent or any successor
Rights Agent, shall be the successor to the Rights Agent under this Rights
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 Rights Agreement, any of the Right
Certificates shall have been countersigned but not delivered, 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 such successor Rights Agent; and in
all such cases such Right Certificates shall have the full force provided in
the Right Certificates and in this Rights Agreement.
(b) In case at any time the name of the Rights Agent shall be changed and at
such time any of the Right Certificates shall have been countersigned but not
delivered the Rights Agent may adopt the countersignature under its prior name
and deliver Right Certificates so countersigned; and in case at that time any
of the Right Certificates shall not have been
countersigned, the Rights Agent may countersign such Right Certificates
either in its prior name or in its changed name and in all such cases such
Right Certificates shall have the full force provided in the Right Certificates
and in this Rights Agreement.
Section 20. Duties of Rights Agent. The Rights Agent undertakes the
duties and obligations imposed by this Rights Agreement 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 Rights 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 Chief Executive Officer,
President, any Vice President, the Treasurer or the Secretary of the Company
(each, an
-25-
Authorized Officer) 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 Rights
Agreement in reliance upon such certificate.
(c) The Rights Agent shall be liable hereunder to the Company and any
other Person 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 Rights Agreement or in the
Right Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be deemed
to have been made by the Company only.
(e) The Rights Agent shall not be under any responsibility in respect of the
validity of this Rights 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 Rights Agreement or in any Right Certificate; nor
shall it be responsible for any change in the exercisability of the Rights
(including the Rights becoming void pursuant to Section 11(a)(ii) hereof) or
any adjustment in the terms of the Rights (including the manner, method or
amount thereof) provided for in Sections 3, 11, 13, 23 and 24, or the
ascertaining of the existence of facts that would require any such change or
adjustment (except with respect to the exercise of Rights evidenced by Right
Certificates after receipt of a certificate furnished pursuant to Section 12,
describing such change or 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 or other securities to be issued
pursuant to this Rights Agreement or any Right Certificate or as to whether any shares of
Preferred Stock or other securities will, when issued, be validly authorized
and issued, fully paid and nonassessable.
(f) The Company agrees that it will perform, execute, acknowledge and
deliver or cause to be performed, executed, acknowledged and delivered all such
further and other acts, instruments and assurances as may reasonably be
required by the Rights Agent for the carrying out or performing by the Rights
Agent of the provisions of this Rights Agreement.
(g) The Rights Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from any
person reasonably believed by the Rights Agent to be one of the Authorized
Officers, and to apply to such Authorized Officers for advice or instructions
in connection with its duties, and it shall not be liable for any action taken
or suffered by it in good faith in accordance with instructions of any such
Authorized Officer or for any delay in acting while waiting for those
instructions. Any application by the Rights Agent for written instructions
from the Company may, at the option of the Rights Agent, set forth in writing
any action proposed to be taken or omitted by the Rights Agent under this
Rights Agreement and the date on and/or after which such action shall be taken
or such omission shall be effective. The Rights Agent shall not be liable for
any action taken by, or omission of, the Rights Agent in accordance with a
proposal included in any such application on or after the date specified in
such application (which date shall not be less than five Business Days after
the date any Authorized Officer of the Company actually receives such
application, unless any such Authorized Officer shall have consented in writing
to an earlier date) unless, prior to taking any
-26-
such action (or the effective
date in the case of an omission), the Rights Agent shall have received written
instructions in response to such application specifying the action to be taken
or omitted.
(h) The Rights Agent and any stockholder, director, officer or employee of
the Rights Agent may buy, sell or deal in any of the Rights or other securities
of the Company or become pecuniarily interested in any transaction in which the
Company may be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Rights Agent under
this Rights 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.
(j) If, with respect to any Right Certificate surrendered to the Rights
Agent for exercise or transfer, the certificate contained in the form of
assignment or the form of election to purchase set forth on the reverse
thereof, as the case may be, has not been completed to certify the holder is
not an Acquiring Person (or an Affiliate or Associate thereof) or a transferee
thereof, the Rights Agent shall not take any further action with respect to
such requested exercise or transfer without first consulting with the Company.
Section 21. Change of Rights Agent. The Rights Agent or any successor
Rights Agent may resign and be discharged from its duties under this Rights
Agreement upon 30 days notice in writing mailed to the Company and to each
transfer agent of the Common Stock or Preferred Stock by registered or
certified mail, and, following the Distribution Date, to the holders of the
Right Certificates by first-class mail. In the event the transfer agency
relationship in effect between the Company and the Rights Agent terminates, the
Rights Agent will be deemed to resign automatically on the effective date of
such termination; and any required notice will be sent to the Company. The
Company may remove the Rights Agent or any successor Rights Agent upon 30 days
notice in writing, mailed to the Rights Agent or successor Rights Agent, as the
case may be, and to each transfer agent of the Common Stock or Preferred Stock
by registered or certified mail, and, following the Distribution Date, 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) a corporation
organized and doing business under the laws of the United States or any State
thereof, which is authorized under such laws to exercise corporate trust or
stock transfer powers and is subject to supervision or examination by federal or
-27-
state authority and which has at the time of its appointment as Rights Agent
a combined capital and surplus of at least $50 million or (B) an affiliate of a
corporation described in clause (A) of this sentence. After appointment, the
successor Rights Agent shall be vested with the same powers, rights, duties and
responsibilities as if it had been originally named as Rights Agent without
further act or deed; but the predecessor Rights Agent shall deliver and
transfer to the successor Rights Agent any property at the time held by it
hereunder, and execute and deliver any further assurance, conveyance, act or
deed necessary for the purpose. Not later than the effective date of any such
appointment the Company shall file notice thereof in writing with the
predecessor Rights Agent and each transfer agent of the Common Stock or
Preferred Stock, and, following the Distribution Date, 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 Rights Agreement or of the Rights to the contrary, the
Company may, at its option, issue new Right Certificates evidencing Rights in
such forms 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 Rights Agreement. In addition,
in connection with the issuance or sale of Common Stock following the
Distribution Date and prior to the Expiration Date, the Company may with
respect to shares of Common Stock so issued or sold pursuant to (i) the exercise of stock
options, (ii) under any employee plan or arrangement, (iii) the exercise,
conversion or exchange of securities, notes or debentures issued by the Company
or (iv) a contractual obligation of the Company, in each case existing prior to
the Distribution Date, issue Right Certificates representing the appropriate
number of Rights in connection with such issuance or sale.
Section 23. Redemption and Termination. (a) The Board of Directors of
the Company may, at any time prior to such time as any Person first becomes an
Acquiring Person, redeem all but not less than all the then-outstanding Rights
at a redemption price of $.01 per Right, appropriately adjusted to reflect any
stock split, stock dividend or similar transaction occurring after the date
hereof (the Redemption Price). The redemption of the 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. The Company may, at its
option, pay the Redemption Price in cash, shares of Common Stock (based on the
current market price of the Common Stock at the time of redemption as
determined pursuant to Section 11(d)(i) hereof) or any other form of
consideration deemed appropriate by the Board of Directors.
(b) Immediately upon the action of the Board of Directors ordering the
redemption of the Rights pursuant to paragraph (a) of this Section 23 (or at
such later time as the Board of Directors may establish for the effectiveness
of such redemption), 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 (or
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such later time as the Board of Directors may establish for the effectiveness of such redemption),
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 Stock. Any notice which is
mailed in the manner herein provided shall be deemed given, whether or not the
holder receives the notice. Each such notice of redemption shall state the
method by which the payment of the Redemption Price will be made.
(c) 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, Section 24 hereof
and other than in connection with the purchase of Common Stock prior to the
Distribution Date.
(d) It is understood that the TIDE Committee (as provided below) of the Board
of Directors shall review and evaluate this Agreement to determine whether the
maintenance of this Agreement continues to be in the interests of the Company,
its shareholders and any other relevant constituencies of the Company, at least
once every three years. Following each such review, the TIDE Committee will
communicate its conclusions to the full Board of Directors, including any
recommendation in light thereof as to whether this Agreement should be modified
or the Rights should be terminated. The TIDE Committee shall be comprised
of Independent Directors selected by the Board of Directors.
(e) The TIDE Committee (and Independent Directors, when considering the
termination of, or any supplement or amendment to the Rights requiring
Independent Directors) shall have the power to set their own agenda and to
retain at the expense of the Company their choice of legal counsel, investment
bankers and/or other advisors. The TIDE Committee (and the Independent
Directors when considering the termination of, or amendments or supplements to,
the Rights, as described above) shall have the authority to review all
information of the Company and to consider any and all factors they deem
relevant to an evaluation of whether to maintain or modify this Agreement or
terminate the Rights.
Section 24. Exchange. (a) The Board of Directors of the Company may, at
its option, at any time after any Person first becomes an Acquiring Person,
exchange all or part of the then-outstanding and exercisable Rights (which
shall not include Rights that have not become effective or that have become
void pursuant to the provisions of Section 11(a)(ii) hereof) for shares of
Common Stock at an exchange ratio of one share of Common Stock per Right,
appropriately adjusted to reflect any stock split, stock dividend or similar
transaction occurring after the date hereof (such amount per Right 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 an Acquiring Person becomes the Beneficial Owner of
shares of Common Stock aggregating 50% or more of the shares of Common Stock
then outstanding. From and after the occurrence of an event specified in
Section 13(a) hereof, any Rights that theretofore have not been exchanged
pursuant to this Section 24(a) shall thereafter be exercisable only in
accordance with Section 13 and may not be exchanged pursuant to this Section
24(a). The exchange of the Rights by the Board of Directors 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.
-29-
(b) Immediately upon the effectiveness of the action of the Board of
Directors of the Company ordering the exchange of any Rights pursuant to
paragraph (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 shares
of Common Stock equal to the number of such Rights held by such holder
multiplied by the Exchange Ratio. The Company shall promptly give public
notice of any such exchange; provided, however, that the failure to give, or
any defect in, such notice shall not affect the validity of such exchange. The
Company shall promptly mail a notice of any such exchange to all of the holders
of the Rights so exchanged 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 shares of Common Stock for Rights will be effected and, in the
event of any partial exchange, the number of Rights which will be exchanged.
Any partial exchange shall be effected pro rata based on the number of Rights
(other than Rights which have become void pursuant to the provisions of Section
11(a)(ii) hereof) held by each holder of Rights.
(c) The Company may at its option substitute and, in the event that there
shall not be sufficient shares of Common Stock issued but not outstanding or
authorized but unissued (and unreserved) to permit an exchange of Rights as
contemplated in accordance with this Section 24, the Company shall substitute
to the extent of such insufficiency, for each share of Common Stock that would
otherwise be issuable upon exchange of a Right, a number of shares of Preferred
Stock or fraction thereof (or equivalent preferred shares as such term is
defined in Section 11(b)) such that the current per share market price
(determined pursuant to Section 11(d) hereof) of one share of Preferred Stock
(or equivalent preferred share) multiplied by such number or fraction is equal
to the current per share market price of one share of Common Stock (determined
pursuant to Section 11(d) hereof) as of the date of such exchange.
Section 25. Notice of Certain Events. (a) In case the Company shall at
any time after the earlier of the Distribution Date or the Stock Acquisition
Date propose (i) to pay any dividend payable in stock of any class to the
holders of its Preferred Stock or to make any other distribution to the holders
of its Preferred Stock (other than a regular quarterly cash dividend), (ii) to
offer to the holders of its Preferred Stock rights or warrants to subscribe for
or to purchase any additional shares of Preferred Stock or shares of stock of
any class or any other securities, rights or options, (iii) to effect any
reclassification of its Preferred Stock (other than a reclassification
involving only the subdivision or combination of outstanding Preferred Stock),
(iv) to effect the liquidation, dissolution or winding up of the Company, or
(v) to declare or pay any dividend on the Common Stock payable in Common Stock
or to effect a subdivision, combination or consolidation of the Common Stock
(by reclassification or otherwise than by payment of dividends in Common
Stock), 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 or offering of rights or warrants, or the date
on which such liquidation, dissolution, reclassification, subdivision,
combination, consolidation or winding up is to take place and the date of
participation therein by the holders of the Common Stock and/or Preferred
Stock, if any such date is to be fixed, and such notice shall be so given in
the case of any action covered by clause (i) or (ii) above at least 10 days
prior to the record date for determining holders of the
-30-
Preferred Stock 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 Stock and/or Preferred
Stock, whichever shall be the earlier.
(b) In case any event described in Section 11(a)(ii) or Section 13 shall
occur then the Company shall as soon as practicable thereafter give to each
holder of a Right Certificate (or if occurring prior to the Distribution Date,
the holders of the Common Stock) 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) and
Section 13 hereof.
Section 26. Notices. Notices or demands authorized by this Rights 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:
American Axle & Manufacturing Holdings, Inc.
Subject to the provisions of Section 21 hereof, any notice or demand authorized
by this Rights 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:
Equiserve Trust Company, N.A.
Notices or demands authorized by this Rights 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. Except as otherwise provided in
this Section 27, for so long as the Rights are then redeemable, the Company may
in its sole and absolute discretion, and the Rights Agent shall if the Company
so directs, supplement or amend any provision of this Rights Agreement in any
respect without the approval of any holders of the Rights. At any time when
the Rights are no longer redeemable, except as otherwise provided in this
Section 27, the Company may, and the Rights Agent shall, if the Company so
directs, supplement or amend this Rights Agreement without the approval of any
holders of Right Certificates in order to (i) cure any ambiguity, (ii) correct
or supplement any provision contained herein which may be defective or
inconsistent with any other provisions herein, (iii) shorten or lengthen any
time period hereunder, or (iv) change or supplement the provisions hereunder in
any manner which the Company may deem necessary or desirable; provided,
however, that no
-31-
such supplement or amendment shall adversely affect the
interests of the holders of Right Certificates as such (other than an Acquiring
Person or an Affiliate or Associate of an Acquiring Person), and no such
amendment may cause the Rights again to become redeemable or cause this Rights
Agreement again to become amendable other than in accordance with this
sentence. Notwithstanding anything contained in this Rights Agreement to the
contrary, no supplement or amendment shall be made which decreases the
Redemption Price. Upon the delivery of a certificate from an appropriate
officer of the Company which states that the supplement or amendment is in
compliance with the terms of this Section 27, the Rights Agent shall execute
such supplement or amendment; provided that any supplement or amendment that
does not amend Sections 18, 19, 20 or 21 hereof in a manner adverse to the
Rights Agent shall become effective immediately upon execution by the Company,
whether or not also executed by the Rights Agent.
Section 28. Successors. All the covenants and provisions of this Rights
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 Rights Agreement. Nothing in this Rights
Agreement shall be construed to give to any Person other than the Company, the
Rights Agent and the registered holders of the Right Certificates (and, prior
to the Distribution Date, the Common Stock) any legal or equitable right,
remedy or claim under this Rights Agreement; but this Rights 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 Stock).
Section 30. Determinations and Actions by the Board of Directors. The
Board of Directors of the Company shall have the exclusive power and authority
to administer this Rights Agreement and to exercise the rights and powers
specifically granted to the Board of Directors of the Company or to the
Company, or as may be necessary or advisable in the administration of this
Rights Agreement, including, without limitation, the right and power to (i)
interpret the provisions of this Rights Agreement and (ii) make all
determinations deemed necessary or advisable for the administration of this
Rights Agreement (including, without limitation, a determination to redeem or
not redeem the Rights or to amend this Rights Agreement). All such actions,
calculations, interpretations and determinations (including, for purposes of
clause (y) below, all omissions with respect to the foregoing) that are done or
made by the Board of Directors of the Company in good faith, shall (x) be
final, conclusive and binding on the Company, the Rights Agent, the holders of
the Rights, as such, and all other parties, and (y) not subject the Board of
Directors to any liability to the holders of the Rights.
Section 31. Severability. If any term, provision, covenant or restriction
of this Rights Agreement or applicable to this Rights 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 Rights Agreement shall remain in full force and effect and
shall in no way be affected, impaired or invalidated.
Section 32. Governing Law. This Rights Agreement and each Right
Certificate issued hereunder shall be deemed to be a contract made under the
laws of the State of Delaware
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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.
Section 33. Counterparts. This Rights 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 34. Descriptive Headings. Descriptive headings of the several
Sections of this Rights Agreement are inserted for convenience only and shall
not control or affect the meaning or construction of any of the provisions
hereof.
Section 35. Force Majeure. Notwithstanding anything to the contrary contained
herein, Rights Agent shall not be liable for any delays or failures in
performance resulting from acts beyond its reasonable control including,
without limitation, acts of God, terrorist acts, shortage of supply, breakdowns
or malfunctions, interruptions or malfunction of computer facilities, or loss
of data due to power failures or mechanical difficulties with information
storage or retrieval systems, labor difficulties, war, or civil unrest.
-33-
IN WITNESS WHEREOF, the parties hereto have caused this Rights Agreement
to be duly executed and attested, all as of the day and year first above
written.
This certificate also evidences and entitles the holder
hereof to certain rights as set forth in a Rights Agreement
between American Axle & Manufacturing Holdings, Inc. and
EquiServe Trust Company Inc., dated as of September 15,
2003, as the same may be amended, supplemented or otherwise
modified from time to time (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 American Axle & Manufacturing Holdings, Inc.
Under certain circumstances, as set forth in the Rights
Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this
certificate. American Axle & Manufacturing Holdings, Inc.
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, as set
forth in the Rights Agreement, Rights owned by or
transferred to any Person who is or becomes an Acquiring
Person (as defined in the Rights Agreement) and certain
transferees thereof will become null and void and will no
longer be transferable.
(ii) Subject to Section 24 of this Rights Agreement and except as otherwise
provided in this Section 11(a)(ii) and Section 11(a)(iii), in the event
that any Person
becomes an Acquiring Person, each holder of a Right shall
thereafter have the right to receive, upon exercise thereof at a price
equal to the then-current Purchase Price, in accordance with the terms of
this Rights Agreement and in lieu of shares of Preferred Stock, such
number of shares of Common Stock (or at the option of the Company, such
number of one one-thousandths of a share of Preferred Stock) as shall
equal the result obtained by (x) multiplying the then-current Purchase
Price by the number of one one-thousandths of a share of Preferred Stock
for which a Right is then exercisable and dividing that product by (y) 50%
of the then-current per share market price of the Companys Common Stock
(determined pursuant to Section 11(d) hereof) on the date of the
occurrence of such event; provided, however, that the Purchase Price (as
so adjusted) and the number of shares of Common Stock so receivable upon
exercise of a Right shall thereafter be subject to further adjustment as
appropriate in accordance with Section 11(f) hereof. Notwithstanding
anything in this Rights Agreement to the contrary, however, from and after
the time (the invalidation time) when any Person first becomes an
Acquiring Person, any Rights that are beneficially owned by (x) any
Acquiring Person (or any Affiliate or Associate of any Acquiring Person),
(y) a transferee of any Acquiring Person (or any such Affiliate or
Associate) who becomes a transferee after the invalidation time or (z) a
transferee of any Acquiring Person (or any such Affiliate or Associate)
who became a transferee prior to or concurrently with the invalidation
time pursuant to either (I) a transfer from the Acquiring Person to
holders of its equity securities or to any Person with whom it has any
continuing agreement, arrangement or understanding, written or otherwise,
regarding the transferred Rights or (II) a transfer that the Board of
Directors has determined is part of a plan, arrangement or understanding,
written or otherwise, which has the purpose or effect of avoiding the
provisions of this paragraph, and subsequent transferees of such Persons,
shall be void without any further action and any holder of such Rights
shall thereafter have no rights whatsoever with respect to such Rights
under any provision of this Rights Agreement. The Company shall use all
reasonable efforts to ensure that the provisions of this Section 11(a)(ii)
are complied with, but shall have no liability to any holder of Right
Certificates or other Person as a result of its failure to make any
determinations with respect to an Acquiring Person or its Affiliates,
Associates or transferees hereunder. From and after the invalidation
time, no Right Certificate shall be issued pursuant to Section 3 or
Section 6 hereof that represents Rights that are or have become void pursuant
to the provisions of this paragraph, and any Right Certificate delivered
to the Rights Agent that represents Rights that are or have become void
pursuant to the provisions of this paragraph shall be cancelled. From and
after the occurrence of an event specified in Section 13(a) hereof, any
Rights that theretofore have not been exercised pursuant to this Section
11(a)(ii)
shall thereafter be exercisable only in accordance with Section
13 and not pursuant to this Section 11(a)(ii).
(iii) The Company may at its option substitute for a share of Common Stock
issuable upon the exercise of Rights in accordance with the foregoing
subparagraph (ii) such number or fractions of shares of Preferred Stock
having an aggregate current market value equal to the current per share
market price of a share of Common Stock. In the event that there shall
not be sufficient shares of Common Stock issued but not outstanding or
authorized but unissued (and unreserved) to permit the exercise in full of
the Rights in accordance with the foregoing subparagraph (ii), the Board
of Directors
shall, with respect to such deficiency, to the extent
permitted by applicable law and any material agreements then in effect to
which the Company is a party (A) determine the excess of (x) the value of
the shares of Common Stock issuable upon the exercise of a Right in
accordance with the foregoing subparagraph (ii) (the Current Value) over
(y) the then-current Purchase Price multiplied by the number of one
one-thousandths of shares of Preferred Stock for which a Right was
exercisable immediately prior to the time that the Acquiring Person became
such (such excess, the Spread), and (B) with respect to each Right
(other than Rights which have become void pursuant to Section 11(a)(ii)),
make adequate provision to substitute for the shares of Common Stock
issuable in accordance with subparagraph (ii) upon exercise of the Right
and payment of the applicable Purchase Price, (1) cash, (2) a reduction in
such Purchase Price, (3) shares of Preferred Stock or other equity
securities of the Company (including, without limitation, shares or
fractions of shares of preferred stock which, by virtue of having
dividend, voting and liquidation rights substantially comparable to those
of the shares of Common Stock, are deemed in good faith by the Board of
Directors to have substantially the same value as the shares of Common
Stock (such shares of preferred stock and shares or fractions of shares of
preferred stock are hereinafter referred to as Common Stock
equivalents)), (4) debt securities of the Company, (5) other assets or
(6) any combination of the foregoing, having a value which, when added to
the value of the shares of Common Stock actually issued upon exercise of
such Right, shall have an aggregate value equal to the Current Value (less
the amount of any reduction in such Purchase Price), where such aggregate
value has been determined by the Board of Directors upon the advice of a
nationally recognized investment banking firm selected in good faith by
the Board of Directors; provided, however, if the Company shall not make
adequate provision to deliver value pursuant to clause (B) above within
thirty (30) days following the date that the Acquiring Person became such
(the Section 11(a)(ii) Trigger Date), then the Company shall be
obligated to deliver, to the extent permitted by applicable law and any
material agreements then in effect to which the Company is a party, upon
the surrender for exercise of a Right and without requiring payment of the
Purchase Price, shares of Common Stock (to the extent available), and
then, if necessary, such number or fractions of shares of Preferred Stock
(to the extent available) and then, if necessary, cash, which shares
and/or cash have an aggregate value equal to the Spread. If
within the thirty (30) day period referred to above the Board of
Directors shall determine in good faith that it is likely that sufficient
additional shares of Common Stock could be authorized for issuance upon
exercise in full of the Rights, then, if the Board of Directors so elects,
such thirty (30) day period 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 thirty (30) day period, as
it may be extended, is hereinafter called the Substitution Period). To
the extent that the Company determines that some action need be taken
pursuant to the second and/or third sentence of this Section 11(a)(iii),
the Company (x) shall provide, subject to Section 11(a)(ii) hereof and the
last sentence of this Section 11(a)(iii) hereof, that such action shall
apply uniformly to all outstanding Rights and (y) may suspend the
exercisability of the Rights until the expiration of the Substitution
Period in order to seek any authorization of additional shares and/or to
decide the appropriate form of distribution to be made pursuant to such
second sentence and to
determine the value thereof. In the event of any
such suspension, the Company shall issue a public announcement stating
that the exercisability of the Rights has been temporarily suspended, as
well as a public announcement at such time as the suspension is no longer
in effect. For purposes of this Section 11(a)(iii), the value of the
shares of Common Stock shall be the current per share market price (as
determined pursuant to Section 11(d)(i)) on the Section 11(a)(ii) Trigger
Date and the per share or fractional value of any Common Stock equivalent
shall be deemed to equal the current per share market price of the Common
Stock. The Board of Directors of the Company may, but shall not be
required to, establish procedures to allocate the right to receive shares
of Common Stock upon the exercise of the Rights among holders of Rights
pursuant to this Section 11(a)(iii).
(ii) For the purpose of any computation hereunder, if the Preferred
Stock is publicly traded, the current per share market price of the
Preferred Stock shall be determined in accordance with the method set
forth in Section 11(d)(i). If the Preferred Stock is not publicly traded
but the Common Stock is publicly traded, the current per share market
price of the Preferred Stock shall be conclusively deemed to be the
current per share market price of the Common Stock, as determined pursuant
to Section 11(d)(i), multiplied by one thousand (appropriately adjusted to
reflect any stock split, stock dividend or similar transaction occurring
after the date hereof). If neither the Common Stock nor the Preferred
Stock is publicly 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 and shall be binding on the Rights Agent.
(i) in the case of any transaction described in (i) or (ii) of the
first sentence of Section 13(a) hereof: (A) the Person that is the issuer
of the securities into which the shares of Common Stock are converted in
such merger or consolidation, or, if there is more than one such issuer,
the issuer of the shares of Common Stock of which have the greatest
aggregate market value of shares outstanding, or (B) if no securities are
so issued, (x) the Person that is the other party to the merger, if such
Person survives said merger, or, if there is more than one such Person,
the Person the shares of Common Stock of which have the greatest aggregate
market value of shares outstanding or (y) if the Person that is the other
party to the merger does not survive the merger, the Person that does
survive the merger (including the Company if it survives) or (z) the
Person resulting from the consolidation; and
(ii) in the case of any transaction described in (iii) of the first
sentence in Section 13(a) hereof, the Person that is the party receiving
the greatest portion of the assets or earning power transferred pursuant
to such transaction or transactions, or, if each Person that is a party to
such transaction or transactions receives the same portion of the assets
or earning power so transferred or if the Person receiving the greatest
portion of the assets or earning power cannot be determined, whichever of
such Persons is the issuer of Common Stock having the greatest aggregate market value of
shares outstanding;
(i) prepare and file a registration statement under the Securities
Act, if necessary, with respect to the Rights and the securities
purchasable upon exercise of the Rights on an appropriate form, use its
best efforts to cause such registration statement to become effective as
soon as practicable after such filing and use its best efforts to cause
such registration statement to remain effective (with a prospectus at all
times meeting the requirements of the Securities Act) until the Expiration
Date, and similarly comply with applicable state securities laws;
(ii) use its best efforts, if the Common Stock of the Principal Party
shall be listed or admitted to trading on NYSE or on another national
securities exchange, to list or admit to trading (or continue the listing
of) the Rights and the securities purchasable upon exercise of the Rights
on NYSE or such securities exchange, or, if the Common Stock of the
Principal Party shall not be listed or admitted to trading on NYSE or a
national securities exchange, to cause the Rights and the securities
receivable upon exercise of the Rights to be reported by such other system
then in use;
(iii) deliver to holders of the Rights historical financial
statements for the Principal Party which comply in all respects with the
requirements for registration on Form 10 (or any successor form) under the
Exchange Act; and
(iv) obtain waivers of any rights of first refusal or preemptive
rights in respect of the Common Stock of the Principal Party subject to
purchase upon exercise of outstanding Rights.
(i) prior to the Distribution Date, the Rights will be transferable
only in connection with the transfer of the Common Stock;
(ii) after the Distribution Date, the Right Certificates are
transferable only on the registry books of the Rights Agent if surrendered
at the office or agency of the Rights Agent designated for such purpose,
duly endorsed or accompanied by a proper instrument of transfer; and
(iii) 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 Common Stock) 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 Common Stock certificate made by
anyone other than the Company or the Rights Agent) for all purposes
whatsoever, and neither the Company nor the Rights Agent, subject to
Section 7(e) hereof, shall be affected by any notice to the contrary.
1840 Holbrook Avenue
Detroit, Michigan 48212
Attn: General Counsel
150 Royall Street
Canton, MA 02021
Attn: General Counsel
AMERICAN AXLE & MANUFACTURING
HOLDINGS, INC. |
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Attest: | By: | |||
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Name: | ||||
Title: | ||||
EQUISERVE TRUST COMPANY, N.A.. | ||||
Attest: | By: | |||
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Name: | ||||
Title: |
EXHIBIT A
FORM
OF
CERTIFICATE OF DESIGNATIONS
OF
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
(Pursuant to Section 151 of the
General Corporation Law of the State of Delaware)
American Axle & Manufacturing Holdings, Inc., a corporation organized and existing under the General Corporation Law of the State of Delaware (the Company), hereby certifies that the following resolution was duly adopted by the Board of Directors of the Company as required by Section 151 of the General Corporation Law of the State of Delaware on September 15, 2003:
RESOLVED, that pursuant to the authority vested in the Board of Directors of the Company (hereinafter being referred to as the Board of Directors or the Board) in accordance with the provisions of the Companys Amended and Restated Certificate of Incorporation (hereinafter being referred to as the Certificate of Incorporation), the Board of Directors hereby creates a series of Preferred Stock, par value $.01 per share, of the Company, to be designated the Series A Junior Participating Preferred Stock and hereby adopts the resolution establishing the designations, number of shares, preferences, voting powers and other rights and the restrictions and limitations thereof, of the shares of such series as set forth below:
Section 1. Designation and Amount. The shares of such series shall be designated as Series A Junior Participating Preferred Stock (the Series A Preferred Stock) and the number of shares constituting the Series A Preferred Stock shall be 100,000. Such number of shares may be increased or decreased by resolution of the Board of Directors; provided, that no decrease shall reduce the number of shares of Series A Preferred Stock to a number less than the number of shares then outstanding plus the number of shares reserved for issuance upon the exercise of outstanding options, rights or warrants or upon the conversion of any outstanding securities issued by the Company convertible into Series A Preferred Stock.
Section 2. Dividends and Distributions
(A) Subject to the rights of the holders of any shares of any series of Preferred Stock of the Company (the Preferred Stock) (or any similar stock) ranking prior and superior to the Series A Preferred Stock with respect to dividends, the holders |
A-1
of shares of Series A Preferred Stock, in preference to the holders of Common Stock, par value $.01 per share, of the Company (the Common Stock) and of any other stock of the Company ranking junior to the Series A Preferred Stock, shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose, quarterly dividends payable in cash on the last day of January, April, July, and October in each year (each such date being referred to herein as a Dividend Payment Date), commencing on the first Dividend Payment Date after the first issuance of a share or fraction of a share of Series A Preferred Stock (the Issue Date), in an amount per share (rounded to the nearest cent) equal to the greater of (a) $1 or (b) subject to the provision for adjustment hereinafter set forth, 1,000 times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions other than a dividend payable in shares of Common Stock, declared on the Common Stock since the immediately preceding Dividend Payment Date or, with respect to the first Dividend Payment Date, since the first issuance of any share or fraction of a share of Series A Preferred Stock. In the event the Company shall at any time after the Issue Date declare and pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event under clause (b) of the preceding sentence shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. |
(B) The Company shall declare a dividend or distribution on the Series A Preferred Stock as provided in paragraph (A) of this Section immediately after it declares a dividend or distribution on the Common Stock (other than a dividend payable in shares of Common Stock); provided that, in the event no dividend or distribution shall have been declared on the Common Stock during the period between any Dividend Payment Date and the next subsequent Dividend Payment Date, a dividend of $1 per share on the Series A Preferred Stock shall nevertheless be payable, when, as and if declared, on such subsequent Dividend Payment Date. |
(C) Dividends shall begin to accrue and be cumulative, whether or not earned or declared, on outstanding shares of Series A Preferred Stock from the Dividend Payment Date next preceding the date of issue of such shares, unless the date of issue of such shares is prior to the record date for the first Dividend Payment Date, in which case dividends on such shares shall begin to accrue from the date of issue of such shares, or unless the date of issue is a Dividend Payment Date or is a date after the record date for the determination of holders of shares of Series A Preferred Stock entitled to receive a quarterly dividend and before such Dividend Payment Date, in either of which events such dividends shall begin to accrue and be cumulative from such Dividend Payment Date. Accrued but unpaid dividends shall not bear interest. Dividends paid on the shares of Series A Preferred Stock in an amount less than the total amount of such dividends at |
A-2
the time accrued and payable on such shares shall be allocated pro rata on a share-by-share basis among all such shares at the time outstanding. The Board of Directors may fix a record date for the determination of holders of shares of Series A Preferred Stock entitled to receive payment of a dividend or distribution declared thereon, which record date shall be not more than 60 days prior to the date fixed for the payment thereof. |
Section 3. Voting Rights. The holders of shares of Series A Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth and except as otherwise provided in the Certificate of Incorporation or required by law, each share of Series A Preferred Stock shall entitle the holder thereof to 1,000 votes on all matters upon which the holders of the Common Stock of the Company are entitled to vote. In the event the Company shall at any time after the Issue Date declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the number of votes per share to which holders of shares of Series A Preferred Stock were entitled immediately prior to such event shall be adjusted by multiplying such number by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. |
(B) Except as otherwise provided herein, in the Certificate of Incorporation or in any other Certificate of Designations creating a series of Preferred Stock or any similar stock, and except as otherwise required by law, the holders of shares of Series A Preferred Stock and the holders of shares of Common Stock and any other capital stock of the Company having general voting rights shall vote together as one class on all matters submitted to a vote of stockholders of the Company. |
(C) Except as set forth herein, or as otherwise provided by law, holders of Series A Preferred Stock shall have no special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Stock as set forth herein) for taking any corporate action. |
(D) If, at the time of any annual meeting of stockholders for the election of directors, the equivalent of six quarterly dividends (whether or not consecutive) payable on any share or shares of Series A Preferred Stock are in default, the number of directors constituting the Board of Directors of the Company shall be increased by two. In addition to voting together with the holders of Common Stock for the election of other directors of the Company, the holders of record of the Series A Preferred Stock, voting separately as a class to the exclusion of the holders of Common Stock shall be entitled at said meeting of stockholders (and at each subsequent annual meeting of stockholders), unless all dividends in arrears on the Series A Preferred Stock have been paid or declared and set apart for payment prior thereto, to vote for the election of two directors of the Company, the holders of any Series A Preferred Stock being entitled to cast a number of votes per |
A-3
share of Series A Preferred Stock as is specified in paragraph (A) of this Section 3. Each such additional director shall serve until the next annual meeting of stockholders for the election of directors, or until his successor shall be elected and shall qualify, or until his right to hold such office terminates pursuant to the provisions of this Section 3(D). Until the default in payments of all dividends which permitted the election of said directors shall cease to exist, any director who shall have been so elected pursuant to the provisions of this Section 3(D) may be removed at any time, without cause, only by the affirmative vote of the holders of the shares of Series A Preferred Stock at the time entitled to cast a majority of the votes entitled to be cast for the election of any such director at a special meeting of such holders called for that purpose, and any vacancy thereby created may be filled by the vote of such holders. If and when such default shall cease to exist, the holders of the Series A Preferred Stock shall be divested of the foregoing special voting rights, subject to revesting in the event of each and every subsequent like default in payments of dividends. Upon the termination of the foregoing special voting rights, the terms of office of all persons who may have been elected directors pursuant to said special voting rights shall forthwith terminate, and the number of directors constituting the Board of Directors shall be reduced by two. The voting rights granted by this Section 3(D) shall be in addition to any other voting rights granted to the holders of the Series A Preferred Stock in this Section 3. |
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions payable on the Series A Preferred Stock as provided in Section 2 are in arrears, thereafter and until all accrued and unpaid dividends and distributions, whether or not earned or declared, on shares of Series A Preferred Stock outstanding shall have been paid in full, the Company shall not: |
(i) declare or pay dividends, or make any other distributions, on any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock; | |
(ii) declare or pay dividends, or make any other distributions, on any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except dividends paid ratably on the Series A Preferred Stock and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which the holders of all such shares are then entitled; | |
(iii) redeem or purchase or otherwise acquire for consideration shares of any stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series A Preferred Stock, provided that the Company may at any time redeem, purchase or otherwise acquire shares of any such junior stock in exchange for shares of any stock of the Company ranking junior (as to dividends and upon dissolution, liquidation or winding up) to the Series A Preferred Stock or rights, warrants or options to acquire such junior stock; or |
A-4
(iv) redeem or purchase or otherwise acquire for consideration any shares of Series A Preferred Stock, or any shares of stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series A Preferred Stock, except in accordance with a purchase offer made in writing or by publication (as determined by the Board of Directors) to all holders of such shares upon such terms as the Board of Directors, after consideration of the respective annual dividend rates and other relative rights and preferences of the respective series and classes, shall determine in good faith will result in fair and equitable treatment among the respective series or classes. |
(B) The Company shall not permit any subsidiary of the Company to purchase or otherwise acquire for consideration any shares of stock of the Company unless the Company could, under paragraph (A) of this Section 4, purchase or otherwise acquire such shares at such time and in such manner. |
Section 5. Reacquired Shares. Any shares of Series A Preferred Stock purchased or otherwise acquired by the Company in any manner whatsoever shall be retired and cancelled promptly after the acquisition thereof. All such shares shall upon their retirement become authorized but unissued shares of Preferred Stock and may be reissued as part of a new series of Preferred Stock to be created by resolution or resolutions of the Board of Directors, subject to any conditions and restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. Upon any liquidation,
dissolution or winding up of the Company, no distribution shall be made (A) to
the holders of the Common Stock or of shares of any other stock of the Company
ranking junior, upon liquidation, dissolution or winding up, to the Series A
Preferred Stock unless, prior thereto, the holders of shares of Series A
Preferred Stock shall have received $100 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not earned
or declared, to the date of such payment, provided that the holders of shares
of Series A Preferred Stock shall be entitled to receive an aggregate amount
per share, subject to the provision for adjustment hereinafter set forth, equal
to 1,000 times the aggregate amount to be distributed per share to holders of
shares of Common Stock, or (B) to the holders of shares of stock ranking on a
parity upon liquidation, dissolution or winding up with the Series A Preferred
Stock, except distributions made ratably on the Series A Preferred Stock and
all such parity stock in proportion to the total amounts to which the holders
of all such shares are entitled upon such liquidation, dissolution or winding
up. In the event, however, that there are not sufficient assets available to
permit payment in full of the Series A liquidation preference and the
liquidation preferences of all other classes and series of stock of the
Company, if any, that rank on a parity with the Series A Preferred Stock in
respect thereof, then the assets available for such distribution shall be
distributed ratably to the holders of the Series A Preferred Stock and the
holders of such parity shares in the proportion to their respective liquidation
preferences. In the event the Company shall at any time after the Issue Date
declare or pay any dividend on the Common Stock payable in shares of Common
Stock, or effect a subdivision or combination or consolidation of the
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the aggregate amount
to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under the proviso in clause (A) of
A-5
the preceding sentence shall be adjusted by multiplying such amount by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
Neither the merger or consolidation of the Company into or with another entity nor the merger or consolidation of any other entity into or with the Company (nor the sale of all or substantially all of the assets of the Company) shall be deemed to be a liquidation, dissolution or winding up of the Company within the meaning of this Section 6.
Section 7. Consolidation, Merger, etc. In case the Company shall enter into any consolidation, merger, combination or other transaction in which the shares of Common Stock are converted into, exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case each share of Series A Preferred Stock shall at the same time be similarly converted into, exchanged for or changed into an amount per share (subject to the provision for adjustment hereinafter set forth) equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is converted, exchanged or converted. In the event the Company shall at any time after the Issue Date declare or pay any dividend on the Common Stock payable in shares of Common Stock, or effect a subdivision or combination or consolidation of the outstanding shares of Common Stock (by reclassification or otherwise than by payment of a dividend in shares of Common Stock) into a greater or lesser number of shares of Common Stock, then in each such case the amount set forth in the preceding sentence with respect to the conversion, exchange or change of shares of Series A Preferred Stock shall be adjusted by multiplying such amount by a fraction, the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series A Preferred Stock shall not be redeemable from any holder.
Section 9. Rank. The Series A Preferred Stock shall rank, with respect to the payment of dividends and the distribution of assets upon liquidation, dissolution or winding up of the Company, junior to all other series of Preferred Stock and senior to the Common Stock.
Section 10. Amendment. If any proposed amendment to the Certificate of Incorporation (including this Certificate of Designations) would alter, change or repeal any of the preferences, powers or special rights given to the Series A Preferred Stock so as to affect the Series A Preferred Stock adversely, then the holders of the Series A Preferred Stock shall be entitled to vote separately as a class upon such amendment, and the affirmative vote of two-thirds of the outstanding shares of the Series A Preferred Stock, voting separately as a class, shall be necessary for the adoption thereof, in addition to such other vote as may be required by the General Corporation Law of the State of Delaware.
Section 11. Fractional Shares. Series A Preferred Stock may be issued in
fractions of a share that shall entitle the holder, in proportion to such
holders fractional shares,
A-6
to exercise voting rights, receive dividends, participate in distributions and to have the benefit of all other rights of holders of Series A Preferred Stock.
A-7
IN WITNESS WHEREOF, this Certificate of Designations is executed on behalf
of the Company by its and attested by its Secretary this th
day of , 2003.
A-8
EXHIBIT B
FORM OF RIGHT CERTIFICATE
Right Certificate
AMERICAN AXLE & MANUFACTURING HOLDINGS, INC.
This certifies that
or registered assigns, is the registered
owner of the number of Rights set forth above, each of which entitles the owner
thereof, subject to the terms, provisions and conditions of the Rights
Agreement, dated as of September 15, 2003 as the same may be
amended from time to time (the Rights Agreement), between American Axle &
Manufacturing Holdings, Inc., a Delaware corporation (the Company), and
EquiServe Trust Company, N.A. as Rights Agent (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., New
York City time, on September 15, 2013 at the office or agency of the
Rights Agent designated for such purpose, or of its successor as Rights Agent,
one one-thousandth of a fully paid non-assessable share of Series A Junior
Participating Preferred Stock, par value $.01 per share (the Preferred
Stock), of the Company, at a purchase price of $120.00 per one
one-thousandth of a share of Preferred Stock (the Purchase Price), upon
presentation and surrender of this Right Certificate with the Form of Election
to Purchase duly executed. The number of Rights evidenced by this Rights
Certificate (and the number of one one-thousandths of a share of Preferred
Stock which may be purchased upon exercise hereof) set forth above, and the
Purchase Price set forth above, are the number and Purchase Price as of
September 15, 2003 based on the Preferred Stock as
constituted at such date. As provided in the Rights Agreement, the Purchase
Price, the number of one one-thousandths of a share of Preferred Stock (or
other securities or property) which may be purchased upon the exercise of the
Rights and the number of Rights evidenced by this Right Certificate are subject
to modification and adjustment upon the happening of certain events.
B-1
This Right Certificate is subject to all of the terms, provisions and
conditions of the Rights Agreement, which terms, provisions and conditions are
hereby incorporated herein by reference and made a part hereof and to which
Rights Agreement reference is hereby made for a full description of the rights,
limitations of rights, obligations, duties and immunities hereunder of the
Rights Agent, the Company and the holders of the Right Certificates. Copies of
the Rights Agreement are on file at the principal executive offices of the
Company. The Company will mail to the holder of this Right Certificate a copy
of the Rights Agreement without charge after receipt of a written request
therefor.
This Right Certificate, with or without other Right Certificates, upon
surrender at the office or agency of the Rights Agent designated for such
purpose, may be exchanged for another Right Certificate or Right Certificates
of like tenor and date evidencing Rights entitling the holder to purchase a
like aggregate number of shares of Preferred Stock as the Rights evidenced by
the Right Certificate or Right Certificates surrendered shall have entitled
such holder to purchase. If this Right Certificate shall be exercised in part,
the holder shall be entitled to receive upon surrender hereof another Right
Certificate or Right Certificates for the number of whole Rights not exercised.
Subject to the provisions of the Rights Agreement, the Rights evidenced by
this Certificate (i) may be redeemed by the Company at a redemption price of
$.01 per Right or (ii) may be exchanged in whole or in part for shares of
Preferred Stock or shares of the Companys Common Stock, par value $.01 per
share.
No fractional shares of Preferred Stock or Common Stock will be issued
upon the exercise or exchange of any Right or Rights evidenced hereby (other
than fractions of Preferred Stock which are integral multiples of one
one-thousandth of a share of Preferred Stock, which may, at the election of the
Company, be evidenced by depositary receipts), but in lieu thereof a cash
payment will be made, as provided in the Rights Agreement.
No holder of this Right Certificate, as such, shall be entitled to vote or
receive dividends or be deemed for any purpose the holder of the Preferred
Stock or of any other securities of the Company which may at any time be
issuable on the exercise or exchange 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 Right or Rights evidenced by this Right
certificate shall have been exercised or exchanged as provided in the Rights
Agreement.
This Right Certificate shall not be valid or obligatory for any purpose
until it shall have been countersigned by the Rights Agent.
B-2
WITNESS the facsimile signature of the proper officers of the Company and
its corporate seal. Dated as of
,
.
B-3
Form of Reverse Side of Right Certificate
FORM OF ASSIGNMENT
(
To be executed by the registered holder if such
FOR VALUE RECEIVED
hereby sells, assigns and transfer unto
Rights represented by this Right Certificate, together with all right, title
and interest therein, and does hereby irrevocably constitute and appoint
Attorney, to transfer said Rights on the books of the
within-named Company, with full power of substitution.
Signature Guaranteed:
Signatures must be guaranteed by a bank, trust company, broker, dealer or
other eligible institution participating in a recognized signature guarantee
medallion program.
The undersigned hereby certifies that the Rights evidenced by this Right
Certificate are not beneficially owned by, were not acquired by the undersigned
from, and are not being sold, assigned or transferred to, an Acquiring Person
or an Affiliate or Associate thereof (as defined in the Rights Agreement).
B-4
Form of Reverse Side of Right Certificate
continued
FORM OF ELECTION TO PURCHASE
(
To be executed if holder desires to exercise
To the Rights Agent:
The undersigned hereby irrevocably elects to exercise
Rights represented by this Right Certificate to purchase the shares of
Preferred Stock (or other securities or property) issuable upon the exercise of
such Rights and requests that certificates for such shares of Preferred Stock
(or such other securities) be issued in the name of:
If such number of Rights shall not be all the Rights evidenced by this Right
Certificate, a new Right Certificate for the balance remaining of such Rights
shall be registered in the name of and delivered to:
Signature Guaranteed:
Signatures must be guaranteed by a bank, trust company, broker, dealer or
other eligible institution participating in a recognized signature guarantee
medallion program.
The undersigned hereby certifies that the Rights evidenced by this Right
Certificate are not beneficially owned by, were not acquired by the undersigned
from, and are not being sold, assigned or transferred to, an Acquiring Person
or an Affiliate or Associate thereof (as defined in the Rights Agreement).
B-5
Form of Reverse Side of Right Certificate
continued
NOTICE
The signature in the Form of Assignment or Form of Election to Purchase,
as the case may be, must conform to the name as written upon the face of this
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, such
Assignment or Election to Purchase will not be honored.
B-6
EXHIBIT C
SUMMARY OF RIGHTS TO PURCHASE
On September 15, 2003 the Board of Directors of American Axle &
Manufacturing Holdings, Inc. (the Company) declared a dividend of one
preferred share purchase right (a Right) for each outstanding share of common
stock, par value $.01 per share of the Company (the Common Stock). The
dividend is payable on September 25, 2003 (the Record Date) to the
stockholders of record on that date. Each Right entitles the registered holder
to purchase from the Company one one-thousandth of a share of Series A Junior
Participating Preferred Stock, par value $.01 per share (the Preferred Stock)
of the Company at a price of $120.00 per one one-thousandth of a share of
Preferred Stock (as the same may be adjusted, the Purchase Price). The
description and terms of the Rights are set forth in a Rights Agreement dated
as of September 15, 2003 (as the same may be amended from time to time, the
Rights Agreement), between the Company and EquiServe Trust Company, N.A., as
Rights Agent (the Rights Agent).
Until the close of business on the earlier of (i) the tenth day after the
first date of a public announcement that a person or group of affiliated or
associated persons (an Acquiring Person) have acquired beneficial ownership
of 15% or more of the outstanding shares of Common Stock 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 or group of affiliated persons
becomes an Acquiring Person) after the date of commencement of, or the first
public announcement of an intention to commence, 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 the outstanding shares of Common Stock (the
earlier of such dates being called the Distribution Date), the Rights will be
evidenced by the Common Stock certificates. The Rights Agreement does not
restrict any person who beneficially owns 15% or more of the Common Stock as of
the date of the Rights Agreement so long as such person does not become the
beneficial owner of additional shares of Common Stock representing 2% or more
of the outstanding shares of Common Stock.
The Rights Agreement provides that, until the Distribution Date (or
earlier redemption or expiration of the Rights), the Rights will be
transferable only in connection with the transfer of Common Stock. Until the
Distribution Date (or earlier redemption or expiration of the Rights), the
surrender for transfer of any certificates for shares of Common Stock
outstanding as of the Record Date, even without a notation incorporating the
Rights Agreement by reference or a copy of this Summary of Rights, will also
constitute the transfer of the Rights associated with the shares of Common
Stock represented by such certificate. As soon as practicable following the
Distribution Date, separate certificates evidencing the Rights (Right
Certificates) will be mailed to holders of record of the Common Stock as of
the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.
C-1
The Rights are not exercisable until the Distribution Date. The Rights
will expire on September 15, 2013 (the Final Expiration Date), unless the
Final Expiration Date is extended or unless the Rights are earlier redeemed or
exchanged by the Company, in each case as described below.
The Purchase Price payable, and the number of shares of Preferred Stock or
other securities or property issuable, upon exercise of the Rights are subject
to adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the
Preferred Stock, (ii) upon the grant to holders of the Preferred Stock of
certain rights or warrants to subscribe for or purchase Preferred Stock at a
price, or securities convertible into Preferred Stock with a conversion price,
less than the then-current market price of the Preferred Stock or (iii) upon
the distribution to holders of the Preferred Stock of evidences of indebtedness
or assets (excluding regular periodic cash dividends or dividends payable in
Preferred Stock) or of subscription rights or warrants (other than those
referred to above).
The Rights are also subject to adjustment in the event of a stock dividend
on the Common Stock payable in shares of Common Stock or subdivisions,
consolidations or combinations of the Common Stock occurring, in any such case,
prior to the Distribution Date.
Shares of Preferred Stock purchasable upon exercise of the Rights will not
be redeemable. Each share of Preferred Stock will be entitled, when, as and if
declared, to a minimum preferential quarterly dividend payment of the greater
of (a) $1 per share and (b) an amount equal to 1,000 times the dividend
declared per share of Common Stock. In the event of liquidation, dissolution
or winding up of the Company, the holders of the Preferred Stock will be
entitled to a minimum preferential liquidation payment of $100 per share (plus
any accrued but unpaid dividends) but will be entitled to an aggregate 1,000
times the payment made per share of Common Stock. Each share of Preferred
Stock will have 1,000 votes, voting together with the Common Stock. Finally,
in the event of any merger, consolidation or other transaction in which shares
of Common Stock are converted or exchanged, each share of Preferred Stock will
be entitled to receive 1,000 times the amount received per share of Common
Stock. These rights are protected by customary antidilution provisions.
Because of the nature of the Preferred Stocks dividend, liquidation and
voting rights, the value of the one one-thousandth interest in a share of
Preferred Stock purchasable upon exercise of each Right should approximate the
value of one share of Common Stock.
In the event that any person or group of affiliated or associated persons
becomes an Acquiring Person, each holder of a Right, other than Rights
beneficially owned by the Acquiring Person (which will thereupon become void),
will thereafter have the right to receive upon exercise of a Right and payment
of the Purchase Price, that number of shares of Common Stock having a market
value of two times the Purchase Price.
In the event that, after a person or group has become 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 (other than Rights
beneficially owned by an Acquiring Person which will have become void) will
thereafter have the right to receive, upon the exercise thereof at the then-
C-2
current exercise price of the Right, that number of shares of common stock
of the person with whom the Company has engaged in the foregoing transaction
(or its parent), which number of shares at the time of such transaction will
have a market value of two times the Purchase Price.
At any time after any person or group becomes an Acquiring Person and
prior to the acquisition by such person or group of 50% or more of the
outstanding shares of Common Stock or the occurrence of an event described in
the prior paragraph, the Board of Directors of the Company may exchange the
Rights (other than Rights owned by such person or group which will have become
void), in whole or in part, at an exchange ratio of one share of Common Stock,
or a fractional share of Preferred Stock (or of a share of a similar class or
series of the Companys preferred stock having similar rights, preferences and
privileges) of equivalent value, per Right (subject to adjustment).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional shares of Preferred Stock will be issued
(other than fractions which are integral multiples of one one-thousandth of a
share of Preferred Stock, 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 Stock on the last
trading day prior to the date of exercise.
At any time prior to the time an Acquiring Person becomes such, the Board
of Directors of the Company may redeem the Rights in whole, but not in part, at
a price of $.01 per Right (the Redemption Price). The redemption of the
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 Rights, the right to exercise the Rights
will terminate and the only right of the holders of Rights will be to receive
the Redemption Price.
For so long as the Rights are then redeemable, the Company may, except
with respect to the Redemption Price, amend the Rights Agreement in any manner.
After the Rights are no longer redeemable, the Company may, except with
respect to the Redemption Price, amend the Rights Agreement in any manner that
does not adversely affect the interests of holders of the Rights.
Until a Right is exercised or exchanged, 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 has been filed with the Securities and
Exchange Commission as an Exhibit to a Registration Statement on Form 8-A dated
September 19, 2003. A copy of the Rights Agreement is available free of charge
from the Company. This summary description of the Rights does not purport to
be complete and is qualified in its entirety by reference to the Rights
Agreement, as the same may be amended from time to time, which is hereby
incorporated herein by reference.
C-3
Name:
Title:
Attest:
Secretary
Certificate No. R-___
___ Rights
NOT EXERCISABLE AFTER
, 2013 OR EARLIER IF REDEMPTION OR
EXCHANGE OCCURS. THE RIGHTS ARE SUBJECT TO REDEMPTION AT $.01 PER
RIGHT AND TO EXCHANGE ON THE TERMS SET FORTH IN THE RIGHTS AGREEMENT.
UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT,
RIGHTS OWNED BY OR TRANSFERRED TO ANY PERSON WHO IS OR BECOMES AN
ACQUIRING PERSON (AS DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN
TRANSFEREES THEREOF WILL BECOME NULL AND VOID AND WILL NO LONGER BE
TRANSFERABLE.
ATTEST:
AMERICAN AXLE & MANUFACTURING
HOLDINGS, INC.
By:
By:
Countersigned:
,
as Rights Agent
By:
Authorized Signatory
holder desires to transfer the Right Certificate
)
Dated:
,
Rights represented by the Rights Certificate
)
Please insert social security
or other identifying number:
Dated:
,
Signature
(Signature must conform to holder
specified on Right Certificate)
Signature
UNDER CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, RIGHTS
OWNED BY OR TRANSFERRED TO ANY PERSON WHO IS OR BECOMES AN ACQUIRING
PERSON (AS DEFINED IN THE RIGHTS AGREEMENT) AND CERTAIN TRANSFEREES
THEREOF WILL BECOME NULL AND VOID AND WILL NO LONGER BE TRANSFERABLE.
Shares of Preferred Stock
Exhibit 99.1
American Axle & Manufacturing Holdings, Inc. Adopts
Stockholder Rights Plan
September 15, 2003
Detroit, September 15, 2003 American Axle & Manufacturing Holdings, Inc. (NYSE: AXL), announced today that its Board of Directors has adopted a Stockholder Rights Plan. In the face of a rapidly evolving automotive supply industry, the adoption of the Rights Plan provides protection against coercive or unfair takeover tactics, and should encourage anyone seeking to acquire the Company to negotiate with the Board first. The Rights Plan is similar to plans adopted by many public companies and other automotive supply companies. The Company believes that the Rights Plan should provide a sound and reasonable means of safeguarding the interests of all stockholders should an effort be made to acquire the Company at a price not reflective of its fair value.
The purpose of this rights plan is to give our Board of Directors sufficient time to study and respond to any unsolicited attempt to acquire the Company and enable all stockholders of the Company to realize the full value of their investment, said Richard E. Dauch, Co-Founder, Chairman of the Board & Chief Executive Officer of the Company. The adoption of this Rights Plan is part of our ongoing effort to implement and execute prudent business practices and is not in response to any hostile acquisition attempt.
The Rights are designed to assure that all Company stockholders receive fair and equal treatment in the event of any proposed takeover of the Company and to guard against partial tender offers, open market accumulations, and other abusive tactics that might be used to gain control of the Company at a price not reflective of its fair value.
In connection with the adoption of the Rights Plan, the Board declared a dividend of one preferred share purchase right for each outstanding share of Company Common Stock. Each Right, which is not presently exercisable, entitles the holder to purchase one one-thousandth of a share of Series A Preferred Stock. In the event that any person acquires 15% or more of the outstanding shares of Common Stock, each holder of a Right (other than the acquiring person or group) will be entitled to receive, upon payment of the exercise price for the Right, shares of Common Stock having a market value of two times the exercise price. Existing shareholdings beneficially owned by Richard E. Dauch and Blackstone Capital Partners II Merchant Banking Fund L.P. and its affiliated funds that currently exceed 15% will be grandfathered under the Rights Plan. In order to retain flexibility and the ability to maximize stockholder value in the event of unknown future transactions, the Board retains the power to redeem the Rights for a set amount.
The distribution of the Rights will be made on September 25, 2003, payable to stockholders of record at the close of business on that date. In conjunction with the distribution, details of the Rights are contained in a letter that is being mailed to all stockholders of American Axle & Manufacturing Holdings, Inc.
2
Concurrently with the adoption of the Plan, the Board has also deemed it advisable and in the best interests of the Company and its shareholders to enter into certain arrangements providing for, among other things, certain severance payments and benefits to be provided upon the occurrence of certain qualifying terminations of employment which may occur following certain corporate events to its senior management and other key employees, as a method of retaining such executives and employees.
AAM is a world leader in the manufacture, design, engineering, and validation of driveline systems and related components and modules, chassis systems and forged products for trucks, sport utility vehicles and passenger cars. In addition to its 14 locations in the United States (in Michigan, New York and Ohio), AAM also has offices and facilities in Brazil, England, Germany, Japan, Mexico and Scotland.
Certain statements contained in this press release which are not historical facts contain forward-looking information with respect to the Companys plans, projections or future performance, the occurrence of which involves risk and uncertainties that could cause the companys actual results or plans to differ materially from those expected by the company which include risk factors described in the Companys filings with the Securities and Exchange Commission.
For more information, please contact either of the following:
Patrick S. Lancaster
Vice President, Chief Administrative
Officer & Secretary
(313) 974-2949
Washoj@aam.com
Robin J. Adams
Executive Vice President Finance &
Chief Financial Officer
(313) 974-2131
Robin.Adams@aam.com
Or visit the AAM website at http://www.aam.com