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FIRST AMENDMENT TO
PREFERRED SHARES RIGHTS AGREEMENT
This First Amendment to Preferred Shares Rights Agreement (this
"Amendment") is made as of May 22, 1998 by and between Pete's Brewing Company, a
California corporation (the "Company"), and Norwest Bank Minnesota, N.A., a
national banking association (the "Rights Agent").
WHEREAS, the Company and American Stock Transfer and Trust Company (the
"Former Agent") entered into a Preferred Shares Rights Agreement dated as of
November 25, 1996 (the "Agreement").
WHEREAS, effective as of October 1, 1997, the Company discharged
American Stock Transfer and Trust Company as rights agent under the Agreement
and appointed the Rights Agent as the successor rights agent.
WHEREAS, the Company has entered into an Agreement and Plan of Merger
dated as of May 22, 1998 (as it may be amended or supplemented from time to
time, the "Merger Agreement") among PBC Holdings, Inc. ("PBC Holdings"), PBC
Acquisition Corp. ("PBC Acquisition"), The Gambrinus Company and the Company.
WHEREAS, Section 3.16 of the Merger Agreement provides that the Company
will amend the Agreement (defined below) within two Business Days (as defined in
the Merger Agreement) following the date of the Merger Agreement to (i) render
the Agreement inapplicable to the Merger (as defined in the Merger Agreement)
and the Merger Agreement, (ii) ensure that (y) none of PBC Holdings, PBC
Acquisition or any of their respective affiliates is an Acquiring Person (as
defined in the Agreement) pursuant to the Agreement solely by virtue of the
execution of the Merger Agreement and the consummation of the Merger and (z) a
Distribution Date or a Shares Acquisition Date (as such terms are defined in the
Agreement) does not occur by reason of the Merger, the execution of the Merger
Agreement or the consummation of the Merger and (iii) provide that the Final
Expiration Date (as defined in the Agreement) shall occur immediately prior to
the Effective Time (as defined in the Merger Agreement), and such amendment will
not be further amended by the Company without the prior consent of PBC Holdings
in its sole discretion.
WHEREAS, pursuant to Section 27 of the Agreement, this Amendment is
being executed by the Company and the Rights Agent for the purpose of amending
the Agreement as set forth below.
NOW, THEREFORE, the Agreement is hereby amended as follows:
1. Section 1(a) is amended by inserting the following at the end of
Section 1(a):
"Notwithstanding the foregoing or any provision to the contrary
in this Agreement, none of PBC Holdings, Inc. ("PBC Holdings"),
PBC Acquisition Corp. ("PBC
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Acquisition"), their subsidiaries, Affiliates or Associates or
permitted assignees or transferees under those certain
Stockholder Agreements of even date herewith between PBC Holdings
and certain stockholders of the Company (the "Voting Agreements")
is an Acquiring Person pursuant to this Agreement solely by
virtue of the execution of the Agreement and Plan of Merger dated
May 22, 1998 among PBC Holdings, PBC Acquisition, The Gambrinus
Company and the Company (the "Merger Agreement") and the Voting
Agreements or the consummation of the Merger (as defined in the
Merger Agreement) or the other transactions contemplated by the
Voting Agreements."
2. Section 1(h) is amended by inserting the following at the end of
Section 1(h):
"Notwithstanding the foregoing or any provision to the contrary
in this Agreement, a Distribution Date shall not occur solely by
reason of the execution of the Merger Agreement and the Voting
Agreements, the consummation of the Merger, or the consummation
of the other transactions contemplated by Merger Agreement or the
Voting Agreements."
3. Section 1(t) is amended by inserting the following at the end of
Section 1(t):
"Notwithstanding the foregoing or any provision to the contrary
in this Agreement, a Shares Acquisition Date shall not occur
solely by reason of the execution of the Merger Agreement and the
Voting Agreements, the consummation of the Merger, or the
consummation of the other transactions contemplated by the Merger
Agreement or the Voting Agreements."
4. Section 1(x) is amended by inserting the following at the end of
Section 1(x):
"Notwithstanding the foregoing or any provision to the contrary
in this Agreement, a Triggering Event shall not occur solely by
reason of the execution of the Merger Agreement and the Voting
Agreements, the consummation of the Merger, or the consummation
of the other transactions contemplated by the Merger Agreement or
the Voting Agreements."
5. Section 1(k) is amended and restated in its entirety to read as
follows:
"(k) 'FINAL EXPIRATION DATE' shall mean the earlier of (i)
immediately prior to the Effective Time (as defined in the Merger
Agreement) or (ii) October 22, 2006."
6. A new Section 35 is added to the end of the Agreement to read in
its entirety as follows:
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"Section 35. Merger Agreement with PBC Holdings, PBC Acquisition
Corp. and The Gambrinus Company. Neither the performance of the
Merger Agreement nor the consummation of the transactions
contemplated thereby will result in any separation of the Rights
(as defined in the Agreement) from the underlying Common Shares
of the Company, nor entitle or permit the holders of the Rights
to exercise the Rights or otherwise affect the rights of the
holders of Rights, including giving the holders of the Rights
the right to acquire securities of any party to the Merger
Agreement."
7. (a) This Amendment shall be deemed to be entered into under
the laws of the State of California 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.
(b) This Amendment 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.
8. As amended hereby, the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the day and year first above written.
THE COMPANY: THE RIGHTS AGENT UNDER THE AGREEMENT:
PETE'S BREWING COMPANY NORWEST BANK MINNESOTA, N.A.
By: /s/ XXXXXXX X. XXXXXX By: /s/ XXX XXXXXXX
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Name: Xxxxxxx X. Xxxxxx Name: Xxx Xxxxxxx
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Title: Chief Executive Officer Title: Trust Officer
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