AMENDMENT NO. 1 TO RIGHTS AGREEMENT
Amendment No. 1 dated as of March 26, 1998 (the "Amendment"), to the Rights
Agreement, dated as of April 25, 1996 (the "Rights Agreement"), between
Gardenburger, Inc. (f/k/a Wholesome & Hearty Foods, Inc.), an Oregon corporation
(the "Company"), and First Chicago Trust Company of New York, a New York
corporation (the "Rights Agent").
WITNESSETH:
WHEREAS, the Company and the Rights Agent have entered into the Rights
Agreement; and
WHEREAS, on March 26, 1998, the Board of Directors of the Company, in
accordance with Section 26 of the Rights Agreement, determined it desirable and
in the best interests of the Company and its shareholders to supplement and
amend certain provisions of the Rights Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth, the parties hereby agree as follows:
Section 1. Amendment to Section 1.1. Section 1.1 of the Rights Agreement is
amended to read in its entirety as follows:
"1.1 'ACQUIRING PERSON' shall mean any Person (as such term is hereinafter
defined) who or which, together with all Affiliates and Associates (as such
terms are hereinafter defined) of such Person, shall be the Beneficial Owner (as
such term is hereinafter defined) of 15% or more of the Common Shares of the
Company then outstanding, but shall not include: (i) the Company; (ii) any
Subsidiary of the Company; (iii) any employee benefit plan of the Company or of
any Subsidiary of the Company or any entity holding shares of capital stock of
the Company for or pursuant to the terms of any such plan, in its capacity as an
agent or trustee for any such plan; or (iv) any Exempt Person, unless such
Exempt Person becomes the Beneficial Owner of more than the Exempt Percentage of
the Common Shares of the Company then outstanding. "Exempt Person" shall mean
(x) Xxxx X. Xxxxxx, together with all of his Affiliates and Associates,
including, without limitation, the Xxxx X. Xxxxxx Charitable Foundation Trust
(collectively, "Xxxxxx"); and (y) Dresdner Kleinwort Xxxxxx Private Equity
Partners LP, together with all of its Affiliates and Associates, or any one or
more of the Affiliates and Associates of Dresdner Kleinwort Xxxxxx Private
Equity Partners LP (collectively, "Dresdner"). "Exempt Percentage" shall mean,
with respect to Xxxxxx, up to 25% of the Common Shares of the Company then
outstanding and, with respect to Dresdner, up to 22% of the Common Shares of the
Company then outstanding. Notwithstanding the foregoing, no Person shall become
an "Acquiring Person" as the result of an acquisition of Common Shares by the
Company which, by reducing the number of shares outstanding, increases the
proportionate number of shares beneficially owned by such Person to 15% (25% as
to Xxxxxx and 22% as to Dresdner) or more of the Common Shares of the Company
then outstanding; provided, however, that if a Person shall become the
Beneficial Owner of 15% (25% as to Xxxxxx and 22% as to Dresdner) or more of the
Common Shares of the Company then outstanding solely by reason of share
purchases by the Company and shall, after such purchases by the Company, become
the Beneficial Owner of any additional Common Shares of the Company, then such
Person shall be deemed to be an "Acquiring Person." Notwithstanding the
foregoing, if the Board of Directors of the Company determines in good faith
that a Person who would otherwise be an "Acquiring Person," as defined pursuant
to the foregoing provisions of this Section 1.1, has become such inadvertently,
and such Person divests as promptly as practicable a sufficient number of Common
Shares so that such Person would no longer be an Acquiring Person, as defined
pursuant to the foregoing provisions of this Section 1.1, then such Person shall
not be deemed to be an "Acquiring Person" for any purposes of this Agreement (so
long as such Person does not become an Acquiring Person after such
divestiture)."
Section 2. Rights Agreement as Amended. The term "Agreement" as used in the
Rights Agreement shall be deemed to refer to the Rights Agreement as amended
hereby. This Amendment shall be effective as of the date hereof and, except as
set forth herein, the Rights Agreement shall remain in full force and effect and
be otherwise unaffected hereby.
Section 3. 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 of such counterparts shall together constitute but one
and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed and their respective corporate seals to be hereunto affixed, all as of
the day and year first above written.
GARDENBURGER, INC.
By /s/ Xxxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Executive Vice President and
Chief Financial Officer
FIRST CHICAGO TRUST COMPANY
OF NEW YORK
By /s/ Xxxxxx XxXxxxxxx
-----------------------------------
Name: ___________________________
Title: ___________________________
