AMENDMENT NO. 1 TO RIGHTS AGREEMENT
This AMENDMENT NO. 1 TO RIGHTS AGREEMENT (this "Amendment")
dated as of March 17, 1999 between the Associated Group, Inc., a
Delaware corporation (the "Company"), and ChaseMellon Shareholder
Services, L.L.C., successor to Mellon Bank, N.A., a federally chartered
banking entity (the "Rights Agent").
W I T N E S S E T H
WHEREAS, the Company and the Rights Agent entered into a
Rights Agreement dated as of December 14, 1994 (the "Original
Agreement"); and
WHEREAS, the Company and the Rights Agent now desire to amend
the Original Agreement in the manner set forth herein effective as of
the date of this Amendment; and
WHEREAS, Section 26 of the Original Agreement provides that
the Company and the Rights Agent shall, if the Board so directs, amend
any provision of the Original Agreement without the approval of the
Company's stockholders;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements set forth herein, the parties hereby agree as
follows:
1. Section 1 of the Original Agreement is amended (a) to
delete both paragraph "(q)" thereof and all references to paragraph "(q)" in the
text thereof in their respective entireties and (b) to reletter the succeeding
paragraphs "(r)" through "(xx)" thereof so that they are paragraphs "(q)"
through "(ww)" of Section 1, as so amended. All references in the text of the
Original Agreement to these paragraphs "(r)" through "(xx)" of Section 1 shall
correspondingly be amended to reference the paragraphs as relettered hereby.
2. Section 2 of the Original Agreement is amended by deleting
from the first sentence the following clause: "and the holders of the Rights
(who, in accordance with Section 3 hereof, shall prior to the Distribution Date
also be the holders of the Common Stock)".
3. Section 11(a)(iii) of the Original Agreement is amended (a)
to delete the words "(which resolution shall be effective only with the
concurrence of a majority of the Continuing Directors)" in each of the two
places they appear therein and (b) to delete the words "(with the concurrence of
a majority of the Continuing Directors)" in each of the two places they appear
therein.
4. Section 11(b) of the Original Agreement is amended to
delete the words "(with the concurrence of a majority of the Continuing
Directors)" appearing therein.
5. Section 11(c) of the Original Agreement is amended to
delete the words "(with the concurrence of a majority of the Continuing
Directors)" appearing therein.
6. Section 11(d)(i) of the Original Agreement is amended to
delete the words "(with the concurrence of a majority of the Continuing
Directors)" in each of the two places they appear therein.
7. Section 11(d)(ii) of the Original Agreement is amended to
delete the words "(with the concurrence of a majority of the Continuing
Directors)" appearing therein.
8. Section 14(a) of the Original Agreement is amended to
delete the words "(with the concurrence of a majority of the Continuing
Directors)" in each of the two places they appear therein.
9. The first paragraph of Section 18 of the Original Agreement
is hereby amended by inserting the following sentence at the end of the
paragraph: "Anything to the contrary notwithstanding, in no event shall the
Rights Agent be liable for special, indirect, punitive, consequential or
incidental loss or damage of any kind whatsoever (including, but not limited to,
lost profits), even if the Rights Agent has been advised of the likelihood of
such loss or damage.
10. Section 23(a) of the Original Agreement is amended to
delete the words "(following the Stock Acquisition Date, only with the
concurrence of a majority of the Continuing Directors)" appearing therein.
11. Section 23(b) of the Original Agreement is amended to
delete the words "(with, if required, the concurrence of a majority of the
Continuing Directors)" appearing therein.
12. Section 26 of the Original Agreement is amended to delete
the words "(with, where required, the concurrence of a majority of the
Continuing Directors)" appearing therein.
13. Section 28 of the Original Agreement is amended to delete
the second, third and fourth sentences thereof in their entireties and to insert
in lieu thereof the following three sentences:
The Board or, as provided for in Section 11(a)(ii)(A)(2) hereof, the
Outside Directors shall have the exclusive power and authority to
administer this Agreement and to exercise all rights and powers
specifically granted to each of them or, in the case of the Board, to
the Company. The Board also shall have the exclusive power and
authority to exercise such other rights and powers as may be necessary
or advisable in the administration of this Agreement including, without
limitation, the right and power to (a) interpret the provisions of this
Agreement and (b) make all determinations deemed necessary or advisable
for the administration of this Agreement (including a determination to
redeem or not to redeem the Rights, to approve any
agreement described in Section 1(w) hereof, to designate the Ownership
Limitation or to amend the Agreement). All such actions, calculations,
interpretations and determinations (including, for purposes of clause
(y) below, all omissions with respect to the foregoing) which are done
or made by the Board, the Outside Directors or the Company in good
faith, shall (x) be final, conclusive and binding on the Company, the
Rights Agent, the holders of the Rights and all other parties and (y)
not subject the Board or the Outside Directors to any liability to the
holders of the Rights and Rights Certificates. The Rights Agent shall
always be entitled to assume that the Board, the Outside Directors and
the Company acted in good faith and shall be fully protected and incur
no liability in reliance thereon.
14. Section 29(a) of the Original Agreement is amended to
delete the words "(with the concurrence of the Continuing Directors)" appearing
therein.
15. Section 31 of the Original Agreement is amended (a) to
delete the words "(with the concurrence of a majority of the Continuing
Directors)" and (b) to delete the words "the Board with the concurrence of a
majority of the Continuing Directors or by the Continuing Directors or by"
appearing therein.
16. The parties hereto acknowledge that the purpose and intent
of this Amendment is to remove from the Original Agreement the defined term
"Continuing Directors" and all references to "Continuing Directors" therein. If
this Amendment fails to fully achieve that purpose or effectuate that intent,
the parties agree to use all reasonable efforts to fully achieve that purpose
and effectuate that intent.
17. This Amendment is effective as of the date hereof, and
except as amended hereby, the terms and provisions of the Original Agreement
remain in full force and effect and are unaffected hereby.
18. This Amendment may be executed in counterparts, each of
which shall be deemed an original, and which together shall constitute one and
the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed under seal as of the day and year first
above written.
Attest: THE ASSOCIATED GROUP, INC.
By _______________________ By __________________________
Name: Name:
Title: Title:
Attest: CHASEMELLON SHAREHOLDER SERVICES,
L.L.C., as Rights Agent
By _______________________ By __________________________
Name: Name:
Title: Title:
