AMENDMENT NO. 1 TO RIGHTS AGREEMENT
AMENDMENT NO. 1 TO RIGHTS AGREEMENT (this "AMENDMENT") dated as of November
9, 2005 by and between Kitty Hawk, Inc., a Delaware corporation (the "COMPANY"),
and American Stock Transfer & Trust Company (the "RIGHTS AGENT").
WHEREAS, the Company and the Rights Agent have previously entered into that
certain Rights Agreement dated as of January 21, 2004 (the "RIGHTS AGREEMENT");
and
WHEREAS, Section 27 of the Rights Agreement provides that, for so long as
the Rights (as defined in the Rights Agreement) are redeemable, the Company may
from time to time supplement or amend any provision of the Rights Agreement as
the Company may deem necessary or desirable without the approval of any holders
of certificates representing shares of Common Stock (as defined in the Rights
Agreement); and
WHEREAS, the Rights are currently redeemable; and
WHEREAS, the Board of Directors has determined in good faith that the
amendment to the Rights Agreement set forth herein is desirable and, pursuant to
the terms of the Rights Agreement, has duly authorized such amendment to the
Rights Agreement;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
1. Amendment to the Definition of "Acquiring Person". The definition of
"Acquiring Person" set forth in Section 1(a) of the Rights Agreement is hereby
amended and restated in its entirety as follows:
(a) "ACQUIRING PERSON" shall mean any Person (as such term is
hereinafter defined) who or which, together with all Affiliates and
Associates of such Person, shall be the Beneficial Owner (as such term is
hereinafter defined) of 15% or more of the shares of Common Stock then
outstanding, but shall not include (i) the Company, (ii) any Subsidiary of
the Company, (iii) any employee benefit plan of the Company or of any
Subsidiary of the Company, or any Person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan,
(iv) any Person who becomes an Acquiring Person solely as a result of a
reduction in the number of shares of Common Stock outstanding due to the
repurchase of shares of Common Stock by the Company, unless and until such
Person shall purchase or otherwise become (as a result of actions taken by
such Person or its Affiliates or Associates) the Beneficial Owner of
additional shares of Common Stock constituting 1% or more of the then
outstanding shares of Common Stock, or (v) an Exempted Person (as such term
is hereinafter defined). Notwithstanding the foregoing, if (i) the Board of
Directors of the Company determines in good faith that a Person who would
otherwise be an Acquiring Person, as defined pursuant to the foregoing
provisions of this paragraph, has become such inadvertently (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
Agreement) and without any intention of changing or influencing control of
the Company, and (ii) within ten Business Days of being requested by the
Company to advise it regarding the same, such Person certifies to the
Company that such Person acquired shares of Common Stock in excess of
14.99% inadvertently or without knowledge of the terms of the Rights and
who, together with all
Affiliates and Associates, thereafter does not acquire additional shares of
Common Stock and within ten Business Days of being requested by the Company
to do so disposes of the portion of such shares of Common Stock in excess
of 14.99%, then such Person shall not be deemed to be or to have become an
Acquiring Person for any purposes of this Agreement; provided, however,
that if the Person requested to so certify fails to do so within ten
Business Days of the Company's request or such Person fails to dispose of
such shares of Common Stock in excess of 14.99% within ten Business Days of
the Company's request, then such Person shall become an Acquiring Person
immediately after such ten Business Day period. The phrase "then
outstanding," when used with reference to a Person's Beneficial Ownership
of securities of the Company, shall mean the number of such securities then
issued and outstanding together with the number of such securities not then
actually issued and outstanding which such Person would be deemed to own
beneficially hereunder.
2. Amendment to the Definition of "Beneficial Owner". The definition of
"Beneficial Owner" set forth in Section 1(f) of the Rights Agreement is hereby
amended and restated in its entirety as follows:
(f) A Person shall be deemed the "BENEFICIAL OWNER" of, and shall be
deemed to "BENEFICIALLY OWN," any securities:
(i) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to acquire (whether such
right is exercisable immediately or only after the passage of time)
pursuant to any agreement, arrangement or understanding (whether or not in
writing) or upon the exercise of conversion rights, exchange rights,
rights, warrants or options, or otherwise; provided, however, that a Person
shall not, for purposes of this paragraph (i), be deemed the "Beneficial
Owner" of or to "beneficially own," (A) securities tendered pursuant to a
tender or exchange offer made by such Person or any of such Person's
Affiliates or Associates until such tendered securities are accepted for
purchase or exchange, or (B) securities issuable upon exercise of Rights at
any time prior to the occurrence of a Triggering Event, or (C) securities
issuable upon exercise of Rights from and after the occurrence of a
Triggering Event, which Rights were acquired by such Person or any of such
Person's Affiliates or Associates prior to the Distribution Date or
pursuant to Section 3(a) (Issuance of Rights Certificates -- Distribution
Date; Rights Certificates) or Section 22 (Issuance of New Rights
Certificates) (the "ORIGINAL RIGHTS") or pursuant to Section 11(i)
(Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Adjustment of Number of Rights) in connection with an adjustment
made with respect to any Original Rights;
(ii) which such Person or any of such Person's Affiliates or
Associates, directly or indirectly, has the right to vote or dispose of or
has "beneficial ownership" of (as determined pursuant to Rule 13d-3 of the
General Rules and Regulations under the Exchange Act), including pursuant
to any agreement, arrangement or understanding, whether or not in writing;
provided, however, that a Person shall not be deemed the "Beneficial Owner"
of, or to "beneficially own," any security under this subparagraph (ii) as
a result of an agreement, arrangement or understanding to vote such
security if such agreement, arrangement or understanding: (A) arises solely
from a revocable proxy given in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the applicable
provisions of the General Rules and Regulations under the Exchange Act, and
(B) is not also then reportable by such Person on a Schedule 13D under the
Exchange Act (or any comparable or successor report); or
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(iii) which are "beneficially owned," directly or indirectly, by
any other Person (or any Affiliate or Associate thereof) with which such
Person (or any of such Person's Affiliates or Associates) has any
agreement, arrangement or understanding (whether or not in writing), for
the purpose of acquiring, holding, voting (except pursuant to a revocable
proxy as described in the proviso to subparagraph (ii) of this paragraph
(f)) or disposing of any voting securities of the Company;
provided, however, that nothing in this paragraph (f) shall cause a Person
engaged in business as an underwriter of securities to be the "Beneficial Owner"
of or to "beneficially own," any securities acquired through such Person's
participation in good faith in a firm commitment underwriting until the
expiration of forty (40) calendar days after the date of such acquisition.
3. Amendment to the Definition of "Exempted Person". The definition of
"Exempted Person" set forth in Section 1(t) of the Rights Agreement is hereby
amended and restated in its entirety as follows:
(t) "EXEMPTED PERSON" shall mean Xxxxxx, unless and until the earlier
of such time as (i) Xxxxxx, directly or indirectly, and together with its
Affiliates and Associates, becomes the Beneficial Owner of 23.50% or more
of the shares of Common Stock then outstanding (other than under
circumstances described in Section 1(a)(iv) and in the second sentence of
Section 1(a) (replacing for purposes of this clause (i) all references in
Section 1(a) to 14.99% with 23.49%)), (ii) Xxxxxx, directly or indirectly,
and together with its Affiliates and Associates, becomes the Beneficial
Owner of less than 15% of the shares of Common Stock then outstanding, or
(iii) Xxxxxx breaches the terms of the Standstill Agreement. Upon the
occurrence of (i), (ii) or (iii) above, Xxxxxx immediately shall cease to
be an Exempted Person.
4. Deletion of Definitions. Section 1 of the Rights Agreement shall be
amended as follows:
(a) Section 1(q) of the Rights Agreement shall be amended and restated in
its entirety as follows:
"(q) [INTENTIONALLY DELETED]"
(b) Section 1(z) of the Rights Agreement shall be amended and restated in
its entirety as follows:
"(z) [INTENTIONALLY DELETED]"
(c) Section 1(ii) of the Rights Agreement shall be amended and restated in
its entirety as follows:
"(ii) [INTENTIONALLY DELETED]"
(d) Section 1(pp) of the Rights Agreement shall be amended and restated in
its entirety as follows:
"(pp) [INTENTIONALLY DELETED]"
5. Additional Definitions. Section 1 of the Rights Agreement shall be
amended to include the following definitions:
(uu) "XXXXXX" shall mean collectively, Xxxxx X. Xxxxxx, III and any of his
Affiliates and
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Associates.
(vv) "STANDSTILL AGREEMENT" shall mean that certain Standstill Agreement,
dated as of November 10, 2005, by and among the Company, Xxxxxx, and the other
parties thereto.
6. Amendment to Section 3(a). Section 3(a) of the Rights Agreement is
hereby amended and restated in its entirety as follows:
(a) Distribution Date; Rights Certificates. Until the earlier of (i) the
Close of Business on the tenth Business Day after the Stock Acquisition Date
(or, if the tenth Business Day after the Stock Acquisition Date occurs before
the Record Date, the Close of Business on the Record Date), or (ii) the Close of
Business on the tenth Business Day (or such later date as the Board shall
determine prior to such time as any Person becomes an Acquiring Person) after
the date that a tender or exchange offer by any Person (other than the Company,
any Subsidiary of the Company, any employee benefit plan of the Company or of
any Subsidiary of the Company, or any Person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan) is
first published or sent or given within the meaning of Rule 14d-2(a) of the
General Rules and Regulations under the Exchange Act, if upon consummation
thereof such Person would be the Beneficial Owner of 15% (or, in the case of
Xxxxxx, 23.50%, for so long as Xxxxxx is an Exempted Person) or more of the
shares of Common Stock then outstanding (the earlier of (i) and (ii) being
herein referred to as the "DISTRIBUTION DATE"), (x) the Rights will be evidenced
(subject to the provisions of paragraph (b) of this Section 3) by the
certificates for the Common Stock registered in the names of the holders of the
Common Stock (which certificates for Common Stock shall be deemed also to be
certificates for Rights) and not by separate certificates, and (y) the Rights
will be transferable only in connection with the transfer of the underlying
shares of Common Stock (including a transfer to the Company, except pursuant to
the provision of Section 23 (Redemption and Termination)). As soon as
practicable after the Distribution Date, the Rights Agent will send by
first-class, insured, postage prepaid mail, to each record holder of the Common
Stock as of the Close of Business on the Distribution Date, at the address of
such holder shown on the records of the Company, one or more rights
certificates, in substantially the form of Exhibit 2 hereto (the "RIGHTS
CERTIFICATES"), evidencing one Right for each share of Common Stock so held,
subject to adjustment as provided herein. In the event that an adjustment in the
number of Rights per share of Common Stock has been made pursuant to Section
11(p) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights -- Common Stock Adjustments) at the time of distribution of the Rights
Certificates, the Company shall make the necessary and appropriate rounding
adjustments (in accordance with Section 14(a) (Fractional Rights and Fractional
Shares -- Fractional Rights)) so that Rights Certificates representing only
whole numbers of Rights are distributed and cash is paid in lieu of any
fractional Rights. As of and after the Distribution Date, the Rights will be
evidenced solely by such Rights Certificates.
7. Amendment to Section 27. Section 27 of the Rights Agreement is hereby
amended and restated in its entirety as follows:
Section 27. Supplements and Amendments. For so long as the Rights are
redeemable, and subject to the penultimate sentence of this Section 27, the
Company may, and the Rights Agent shall, if the Company so directs, supplement
or amend any provision of this Agreement without the approval of any holders of
certificates representing shares of Common Stock or, on and after the
Distribution Date, the holders of Rights Certificates. At any time when the
Rights are no longer redeemable and subject to the penultimate sentence of this
Section 27, the Company and the Rights Agent shall, if the Company so directs,
supplement or amend this Agreement without the approval of any holders of Rights
Certificates; provided, however, that no such supplement or amendment may (i)
adversely affect the interests of the holders of Rights Certificates (other than
an Acquiring Person or an Affiliate or Associate of any such Person) or, prior
to the Distribution Date, holders of certificates representing shares of Common
Stock;
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(ii) cause this Agreement again to become amendable other than in accordance
with this sentence; or (iii) cause the Rights again to become redeemable. Upon
the delivery of a certificate from an appropriate officer of the Company which
states that the proposed supplement or amendment is in compliance with the terms
of this Section 27, the Rights Agent shall execute such supplement or amendment.
Notwithstanding anything contained in this Agreement to the contrary, no
supplement or amendment shall be made which changes the Redemption Price, the
Final Expiration Date, the Purchase Price, or the number of one one-thousandths
of a share of Preferred Stock for which a right is exercisable; provided,
however, that at any time prior to (i) a Stock Acquisition Date or (ii) the date
that a tender or exchange offer by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the Company or any
Subsidiary of the Company, or any Person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan) is
first published or sent or given within the meaning of Rule 14d-2(a) of the
General Rules and Regulations under the Exchange Act, if upon consummation
thereof, such Person would be the Beneficial Owner of 15% (or, in the case of
Xxxxxx, 23.50%, for so long as Xxxxxx is an Exempted Person) or more of the
shares of Common Stock then outstanding the Board may amend this Agreement to
increase the Purchase Price or extend the Final Expiration Date. Prior to the
Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Common Stock.
8. Effectiveness. This Amendment shall be effective as of November 9, 2005,
as if executed by both parties on such date. Except as expressly amended by this
Amendment, the Rights Agreement shall remain in full force and effect, and all
references to the Rights Agreement from and after such time shall be deemed to
be references to the Rights Agreement as amended hereby.
9. Governing Law. This Amendment shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be governed
by and construed in accordance with the laws of such state applicable to
contracts made and to be performed entirely within such state.
10. Counterparts. 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.
11. Severability. If any term, provision, covenant or restriction of this
Amendment 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 Amendment shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
12. Descriptive Headings. Descriptive headings of the several Sections of
this Amendment are inserted for convenience only and shall not control or affect
the meaning or construction of any of the provisions of this Amendment.
13. Exhibits. Exhibit 2 to the Rights Agreement shall be deemed amended in
a manner consistent with this Amendment.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the day and year first above written.
KITTY HAWK, INC.
By: /s/ Xxxxxx X. Xxxxxx, Xx.
----------------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
Title: President and Chief Executive Officer
AGREED AND ACCEPTED:
AMERICAN STOCK TRANSFER & TRUST COMPANY
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
(Signature Page to the Amendment No. 1 to Rights Agreement)
