EXHIBIT 99.4
RIGHTS AGENT AGREEMENT
This RIGHTS AGREEMENT ("Agreement") is made and entered into as of
_________ ___, 1998, by and between Xxx-Xxxx.xxx, Inc. a Delaware corporation
(the "Company") and _______________ (the "Rights Agent").
R E C I T A L S
A. The Company has (i) declared a dividend of rights (each a "Right") to
purchase shares of common stock, $.01 par value per share ("Common Stock")
payable to stockholders of record on the close of business on December 31, 1998
and (ii) attached Rights to the shares of Common Stock underlying certain
outstanding options and warrants.
B. The Company will file with the Securities and Exchange Commission (the
"SEC"), under the Securities Act of 1933, as amended (the "Act"), a Registration
Statement on Form S-3 to relating the Common Stock to be issued on the exercise
of the Rights.
C. Each Right distributed to holders of record on December 31, 1998 (the
"Record Date") will entitle the holder thereof to purchase, subject to section
4.2 hereof, one share of Common Stock for $17.00 (the "Exercise Price").
D. The Company wishes the Rights Agent to act on its behalf in connection
with the rights offering (the "Rights Offering") as set forth herein, and the
Rights Agent is willing so to act.
A G R E E M E N T
NOW, THEREFORE, for good and valuable consideration the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
1. APPOINTMENT OF RIGHTS AGENT. The Company hereby appoints the Rights
Agent to act as agent in accordance with the instructions set forth in this
Agreement, and the Rights Agent hereby accepts such appointment and agrees to
take such actions as may be necessary to effectuate the terms of this Agreement.
The Company may from time to time appoint such co-rights agents as it may deem
necessary or desirable.
2. DISTRIBUTION OF RIGHTS CERTIFICATES.
2.1. Each Right Certificate, in substantially the form attached as
Exhibit A hereto, subject to such changes as the parties deem necessary ("Rights
Certificates"), shall evidence the holder of Rights (each a "Rightsholder")
therein named to purchase shares of Common Stock upon the terms and conditions
therein and herein set forth.
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2.2. Upon the written authorization of the Company, signed by any of
its duly authorized officers, as to the Record Date, the Rights Agent shall,
from a list of the Rightsholders of Common Stock to be prepared by the Rights
Agent in its capacity as Transfer Agent of the Company, prepare and record Right
Certificates in the names of the Rightsholders, setting forth the number of
Rights to purchase shares of Common Stock calculated on the basis of 0.05 Rights
for each share of Common Stock recorded on the books in the name of each such
Rightsholder. The number of Rights distributed to each Rightsholder shall be
rounded up to the nearest whole number. No Rights Certificate may be divided in
such a way as to permit the holder of such certificate to receive a greater
number of Rights than the number to which such Rights Certificate entitles its
holder, except that a registered broker-dealer, commercial bank or trust
company, securities depository or participant therein, or nominee therefor
(each, a "Qualified Financial Institution") holding shares of Common Stock on
the Record Date for more than one beneficial owner may, upon delivery of a duly
completed and executed Certification and Request for Additional Rights,
substantially in the form attached hereto as Exhibit B, to the Rights Agent on
or before 5:00 p.m., New York time, on the 30th day following the date of
distribution for the Rights, exchange its Rights Certificate to obtain a Rights
Certificate for the number of rights to which all such beneficial owners in the
aggregate would have been entitled had each been a Rightsholder. The Rights
Agent will, upon request, promptly deliver to each person making a request
therefor a form of the Certification and Request for Additional Rights referred
to in the preceding sentence. No fractional Rights will be issued upon exchange
of a Rights Certificate, and any requests to exchange a Rights Certificate that
would result in the issuance of fractional Rights will be rejected.
2.3. Upon the written authorization of the Company, signed by any of
its duly authorized officers, as to the exercise of outstanding warrants or
options the Rights Agent shall issue Rights Certificates to the holders of such
options and warrants calculated in the manner set forth in Section 2.2 above.
2.4. Upon the oral or written advice as to the effective date of the
Registration Statement, the Rights Agent shall promptly deliver the Rights
Certificates, together with a copy of the Prospectus, and any other document as
the Company deems necessary or appropriate, to all stockholders with record
addresses in the United States (including its territories and possessions and
the District of Columbia).
3. RIGHTSHOLDERS.
3.1. The Rights Certificate will be prepared by the Rights Agent, and
the Rights Agent shall affix such identifying information as it deems necessary
to identify each Rightsholder. No Rights Certificate shall be valid for any
purpose unless so executed.
3.2. The Rights Agent will keep or cause to be kept, at its principal
offices in the________, books for registration of Rights. Such books will show
the names and addresses of the respective Rightsholders and the number of Rights
that have been granted or are held.
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3.3. Rights may not be transferred, assigned, pledged or encumbered by
the Rightsholder or a beneficial owner of such Rightsholder.
3.4. Upon receipt by the Company and the Rights Agent of evidence
reasonably satisfactory to them of the loss, theft, destruction or mutilation of
a Rights Certificate, and, in case of loss, theft or destruction, of indemnity
and/or security satisfactory to them, in their sole discretion, and
reimbursement to the Company and the Rights Agent of all reasonable expenses
incidental thereto, and upon surrender and cancellation of the Rights
Certificate, if mutilated, the Rights Agent will make and deliver a new Rights
Certificate of like tenor to the registered Rightsholder, in lieu of the Rights
Certificate so lost, stolen, destroyed or mutilated. If required by the Company
or the Rights Agent, an indemnity bond must be sufficient in the judgment of
each party to protect the Company, the Rights Agent or any agent thereof from
any loss that any of them may suffer if a lost, stolen, destroyed or mutilated
Rights Certificate is replaced.
3.5. Rights issued as of the Record Date shall expire one (1) year
after the effective date of the Registration Statement (the "Expiration Date").
4. EXERCISE OF RIGHTS.
4.1. Subject to Section 4.2, a Rightsholder may exercise his or her
Right(s) by completing, signing and delivering or mailing the Rights Certificate
(with any required signature guarantee(s) as required by the form of Rights
Certificate), together with payment in full of the Exercise Price for each Right
for which he or she is exercising as follows: (i) by mail to __________, or (ii)
____________ by hand or overnight delivery to _______________________. In order
for a Rightsholder to exercise his or her Right(s), the completed Rights
Certificate and payment must be received by the Rights Agent by 5:00 p.m. New
York Time on or before the Expiration Date. Checks or money orders should be
made payable to "______________" in United States Dollars.
4.2. A Rightsholder may exercise his or her Rights only to the extent
such Rightsholder maintains continuous ownership (of record or beneficially) of
the shares of Common Stock to which the Rights relate from the Record Date (or,
in the case of warrants and options, the shares of Common Stock underlying such
warrants or options on the date of exercise of such warrants or options) through
the date on which the Rights are exercised. If the Rightsholder is both the
record and beneficial owner of the shares, then the Rightsholder shall certify
continued ownership as part of the executed Rights Certificate. If the
Rightsholder is exercising Rights on behalf of a beneficial owner of the shares
of Common Stock to which the Rights relate, then the Rightsholder shall certify
as to such beneficial owner's continued ownership of shares of Common Stock at
and through the applicable dates. Rights, and any fractions thereof, will become
unexercisable to the extent that beneficial ownership of the shares to which
they relate are transferred between the Record Date and the date of exercise.
4.3. The Exercise Price will be payable in United States dollars by
check drawn upon a U.S. bank or postal, telegraphic or express money order or
wire transfer of funds to the account maintained by the Rights Agent for such
purpose payable
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to the order of the Rights Agent. The Exercise Price will be deemed to have been
received by the Rights Agent only upon: (i) clearance of any uncertified check,
(ii) receipt by the Rights Agent of any certified check drawn upon a United
States bank or of any postal, telegraphic or express money order or (iii)
receipt of good funds in the Rights Agent's account.
5. REDEMPTION OF RIGHTS.
5.1. The Company may, at its option, redeem all but not less than all
of the then outstanding Rights, at a redemption price of $.01 per Right (the
"Redemption Price"), appropriately adjusted to reflect any stock split, stock
dividend or recapitalization, if (i) the last sale price of the Company's Common
Stock as reported on the Nasdaq National Market (or principal exchange on which
the Common Stock is then listed) exceeds $20.40 per share for 20 consecutive
trading days or (ii) upon a "Change is Control." A "Change in Control" means any
event where: (i) any "person" or "group" (as such terms are used in Section
13(d) and 14(d) of the Exchange Act) is or becomes the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act) of shares representing
more than 50% of the combined voting power of the then-outstanding securities
entitled to vote generally in elections of directors of the Company ("Voting
Stock"), (ii) the Company consolidates with or merges into any other
corporation, or any other person merges into the Company, and, in the case of
any such transaction, the outstanding Common Stock of the Company is
reclassified into or exchanged for any other property or security, unless the
stockholders of the Company immediately before such transaction own, directly or
indirectly immediately following such transaction, at least a majority of the
combined voting power of the outstanding voting securities of the corporation
resulting from such transaction in substantially the same proportion as their
ownership of the Voting Stock immediately before such transaction, (iii) the
Company conveys, transfers or leases all or substantially all of its assets to
any person (other than to one or more wholly-owned subsidiaries of the Company)
or (iv) any time the Continuing Directors do not constitute a majority of the
Board of Directors of the Company (or, if applicable, a successor corporation to
the Company). "Continuing Directors" means as of any date of determination, any
member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the date of this Agreement or (ii) was nominated for
election or elected to such Board of Directors with the approval of a majority
of the Continuing Directors who were members of such board at the time of such
nomination or election.
5.2. Promptly upon action by the Board of Directors of the Company
ordering the redemption of the Rights, the Company and Rights Agent shall give
30 days written notice ("Notice Period") of the redemption of the Rights. The
Rights Agent shall give notice of such redemption to the holders of the then
outstanding Rights by mailing such notice to all such holders at their last
address appearing upon the registry books of the Rights Agent. Any notice that
is mailed in the manner provided herein shall be deemed given, whether or not
the holder receives the notice. Upon expiration of the Notice Period, the right
to exercise the Rights will terminate and the only right thereafter of the
Rightsholders shall be to receive the Redemption Price.
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6. DELIVERY OF SECURITIES. The Rights Agent, in its capacity as the
Transfer Agent, shall issue certificates for Common Stock upon the instructions
of the Company, according to the executed Rights Certificates that have been
accepted by the Company. The Company shall inform the Rights Agent in writing as
to the acceptance of payment and the date for actual issuance of Common Stock to
each Rightsholder. Shares of Common Stock to be issued pursuant to the exercise
of Rights are to be registered in the name of the registered holder of the
Rights Certificate. Delivery of the stock certificates are to be to the
registered holder of the Rights Certificate unless otherwise indicated in the
Rights Certificate, in which case, signatures on such Rights Certificate must be
guaranteed by an Eligible Guarantor Institution, as defined in Rule
17AD-15(a)(2) of the Securities Exchange Act of 1934.
7. FRACTIONAL RIGHTS AND SHARES. No fractional Rights or cash in lieu
thereof will be issued or paid. The number of Rights distributed to each
Rightsholder or beneficial owner holding through a Qualified Financial
Institution that complies with the procedures set forth in Section 2.2 above
will be rounded up to the next whole number. All questions as to the validity
and eligibility of any rounding of fractional Rights (including, without
limitation, in connection with the surrender by a Qualified Financial
Institution of a Rights Certificate, as set forth in Section 2.2 hereof) will be
determined by the Company in its sole discretion, and its determination will be
final and binding.
8. REPORTS. The Rights Agent will notify the Company and its designated
representatives by telephone each commencing on the distribution date and ending
at the Expiration Date, which notice will thereafter be confirmed in writing, of
(i) the number of Rights exercised each week and (ii) the number of Rights for
which a defective Rights Certificate has been received and (iii) cumulative
totals with respect to the information set forth in each of the clauses (i) and
(ii) above. In addition, during the applicable 30-day period, each business day
the Rights Agent will notify the Company or its designated representatives as to
the number of requests from Qualified Financial Institutions holding Rights on
behalf of more than one beneficial owner of Common Stock to exchange a Rights
Certificate or Certificates so as to obtain additional Rights to which such
beneficial holders are entitled, as set forth in Section 2.2 above, and the
increase in the number of Rights that would result from such exchange. The
Rights Agent will also maintain and update a listing of Rightsholders who have
fully or partially exercised their Rights and Rightsholders who have not
exercised their Rights. The Rights Agent will provide the Company and its
respective designated representatives with the information compiled pursuant to
this Section 8 and any Rights Certificates or other documents or date from which
such information is derived, as any of them may request. The Rights Agent hereby
represents and warrants that the information contained in each notification
referred to in this Section 8 will be accurate in all material respects.
9. AMENDMENTS AND WAIVERS; TERMINATION. The Company reserves the right to
alter the Expiration Date upon 30 days notice to Rightsholders, and to amend the
terms and conditions of the Rights, whether the amended terms are more or less
favorable to Rightsholders. All questions as to the timeliness, validity, form
and eligibility (including time of receipt and record ownership) of any exercise
of Rights will be determined by the Company, whose determinations will be final
and binding, and
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Company reserves the right to reject any exercise of a Right if such exercise is
not in proper form, or if the acceptance thereof or the issuance of Common Stock
thereto could be deemed unlawful. The Company also reserves the right to waive
any defect or irregularity or permit a defect or irregularity to be corrected
within such time as it may determine. An exercise of Rights will not be deemed
to have been received or accepted until all irregularities have been waived or
cured within such time as the Company determines in its sole discretion. Neither
the Company nor the Rights Agent will be under any duty to give notification of
any defect or irregularity in connection with the submission of Rights
Certificates or incur any liability for failure to give such notification. Any
exercise as to which no notice of any defect or irregularity has been given by
the Company or the Rights Agent and no notice of rejection has been given prior
to the Expiration Date, shall be deemed accepted by the Company.
10. INSTRUCTIONS. The Rights Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties hereunder from
the Chief Executive Officer, Chief Financial Officer or General Counsel of the
Company, or any other person designated by any of them, and to apply to such
officers for advice or instructions in connection with its duties, and the
Rights Agent will not be liable for any action taken by it in good faith in
accordance with the instructions of any such officer.
11. FEES OF THE RIGHTS AGENT; INDEMNIFICATION.
11.1. The Company agrees to pay the Rights Agent compensation in
accordance with the fee schedule attached hereto as Exhibit C for all services
rendered by it hereunder and, from time to time, on demand of the Rights Agent,
its reasonable expenses and other disbursements incurred in the administration
and execution of this Agreement.
11.2. The Company hereby covenants and agrees to indemnify and to hold
the Rights Agent (the "Indemnified Party") harmless against any losses, claims,
damages, liabilities, costs and expenses (including reasonable fees and
disbursements of legal counsel) that the Indemnified Party may incur or become
subject to arising from or out of any claim or liability resulting from actions
taken as Rights Agent pursuant to this Agreement; PROVIDED, HOWEVER, that such
covenant and agreement does not extend to, and the Indemnified Party will not be
indemnified or held harmless with respect to, such losses, claims, damages,
liabilities, costs and expenses incurred or suffered by the Indemnified Party as
a result, or arising out of, the faith or breach of this Agreement. In
connection therewith, (i) in no case will the Company be liable with respect to
any claim against the Indemnified Party unless the Indemnified Party notifies
the Company in writing of the assertion of a claim against it or of any action
commenced against it, as soon as practicable after it has notice of any such
assertion of a claim or has been served with the summons or other first legal
process giving information as to the nature and basis of the claim (but in any
event at least ten days prior to the date on which an answer or other pleading
must be served in order to prevent a judgment by default in favor of the person
asserting such claim), (ii) the Company will be entitled to participate at its
own expense in the defense of any suit brought to enforce any such claim, and if
the Company so elects, it may assume the defense of any such suit, in which
event the
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Company will not thereafter be liable for the fees and expenses of any
additional counsel that the Indemnified Party may retain, so long as the Company
retains counsel satisfactory to the party to be indemnified, in the exercise of
the party's reasonable judgment, to defend such suit, and (iii) the Indemnified
Party agrees not to settle any litigation in connection with any claim or
liability with respect to which either or both of them may seek indemnification
from the Company without the prior written consent of the Company.
11.3. The Indemnified Party will be protected and will incur no
liability for or with respect to any action taken, suffered or omitted by it
without negligence and in good faith in connection with its administration of
this Agreement in reliance upon any Rights Certificate, 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.
11.4. Anything in this Agreement to the contrary notwithstanding, in
no event will the Indemnified Party be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including but not limited
to lost profits), even if the Indemnified Party has been advised of the
likelihood of such loss or damage and regardless of the form of action.
12. MERGER OR CONSOLIDATION. Any corporation into which the Rights Agent or
Company or any successor Rights Agent or Company may be merged or with which it
may be consolidated, or any corporation resulting from any merger or
consolidation to which any of them may be a party, or any corporation succeeding
to their respective businesses, or any successor, will be the successors to the
Rights Agent, or Company, respectively, under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties hereto.
13. CONCERNING THE RIGHTS AGENT. The Rights Agent undertakes the duties and
obligations imposed by this Agreement upon the following terms and conditions:
13.1. The Rights Agent may consult with legal counsel acceptable to
the Company (who may be, but is not required to be, legal counsel for the
Company), and the opinion of such counsel will 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.
13.2. Whenever in the performance of its duties under this Agreement
the Rights Agent may 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 the Chief Executive Officer, Chief
Financial Officer or General Counsel of the Company and delivered to the Rights
Agent, and such certificate will be full authorization to the Rights
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Agent for any action taken or suffered in good faith by it under the provisions
of this Agreement in reliance upon such certificate.
13.3. Nothing herein precludes the Rights Agent from acting in any
other capacity for the Company.
14. CERTAIN TAX MATTERS. The Rights Agent will comply with the information
reporting and backup withholding requirements of the Internal Revenue Code of
1986, as amended from time to time and any successor statute (the "Code"),
including without limitation, where appropriate, on a timely basis, filing with
the Internal Revenue Service and furnishing to the Company a duly completed form
1099B, if applicable. The Rights Agent will also collect and duly preserve Forms
W-8 and W-9 and other forms or information necessary to comply with the backup
withholding requirement of the Code.
15. GENERAL PROVISIONS.
15.1. NOTICES. Unless otherwise specifically permitted by this
Agreement, all notices or other communications required or permitted under this
Agreement shall be in writing, and shall be personally delivered or sent by
registered or certified mail, postage prepaid, return receipt requested, or sent
by telecopy, provided that the telecopy cover sheet contains a notation of the
date and time of transmission, and shall be deemed received: (i) if personally
delivered, upon the date of delivery to the address of the person to receive
such notice, (ii) if mailed in accordance with the provisions of this paragraph,
two (2) business days after the date placed in the United States mail, (iii) if
mailed other than in accordance with the provisions of this paragraph or mailed
from outside the United States, upon the date of delivery to the address of the
person to receive such notice, or (iv) if given by telecopy, when sent. Notices
shall be given at the following address:
If to the Company: Xxx-Xxxx.xxx, Inc.
0000 Xxxxx 000
Xxx Xxxx, Xxxxxxxxxxxx 00000
If to the Rights Agent:
15.2. COMPLETE AGREEMENT; MODIFICATION. This Agreement and written
agreements, if any, entered into concurrently herewith (i) constitute the
parties' entire agreement, including all terms, conditions, definitions,
warranties, representations, and covenants, with respect to the subject matter
hereof, (ii) merge all prior discussions and negotiations between or among any
or all of them as to the subject
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matter hereof, and (iii) supersede and replace all terms, conditions,
definitions, warranties, representations, covenants, agreements, promises and
understandings, whether oral or written, with respect to the subject matter
hereof. This Agreement may not be amended, altered or modified except by a
writing signed by the party to be bound. With regard to such amendments,
alterations, or modifications, telecopied signatures shall be effective as
original signatures. Any amendment, alteration, or modification requiring the
signature of more than one party may be signed in counterparts.
15.3. FURTHER ACTION. Each party agrees to perform any further acts
and execute and deliver any further documents reasonably necessary to carry out
the provisions of this Agreement.
15.4. ASSIGNMENT. No party may assign its rights under this Agreement
without the prior written consent of the other parties hereto.
15.5. SUCCESSORS AND ASSIGNS. Except as explicitly provided herein to
the contrary, this Agreement shall be binding upon and inure to the benefit of
the parties, their respective successors and permitted assigns.
15.6. SEVERABILITY. If any portion of this Agreement shall be held by
a court of competent jurisdiction to be invalid, void, or otherwise
unenforceable, the remaining provisions shall remain enforceable to the fullest
extent permitted by law if enforcement would not frustrate the overall intent of
the parties (as such intent is manifested by all provisions of this Agreement,
including such invalid, void, or otherwise unenforceable portion).
15.7. EXTENSION NOT A WAIVER. No delay or omission in the exercise of
any power, remedy, or right herein provided or otherwise available to any party
shall impair or affect the right of such party thereafter to exercise the same.
Any extension of time or other indulgence granted to a party hereunder shall not
otherwise alter or affect any power, remedy or right of any other party, or the
obligations of the party to whom such extension or indulgence is granted except
as specifically waived.
15.8. TIME OF ESSENCE. Time is of the essence of each and every term,
condition, obligation and provision hereof.
15.9. NO THIRD PARTY BENEFICIARIES. This Agreement and each and every
provision hereof is for the exclusive benefit of the parties hereto and not for
the benefit of any other party.
15.10. HEADINGS. The headings in this Agreement are inserted only as a
matter of convenience, and in no way define, limit, or extend or interpret the
scope of this Agreement or of any particular provision hereof.
15.11. REFERENCES. A reference to a particular paragraph of this
Agreement shall be deemed to include references to all subordinate paragraphs,
if any.
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15.12. GENDER, NUMBER, AND TENSE. Throughout this Agreement, unless
the context otherwise requires:
(i) the masculine, feminine, and neuter genders each includes the
other;
(ii) the singular includes the plural, and the plural includes
the singular; and
(iii) the past tense includes the present, and the present tense
includes the past.
15.13. COUNTERPARTS. This Agreement may be signed in multiple
counterparts with the same force and effect as if all original signatures
appeared on one copy; and in the event this Agreement is signed in counterparts,
each counterpart shall be deemed an original and all of the counterparts shall
be deemed to be one agreement.
15.14. DRAFTER. The parties acknowledge that each party has received
and approved this Agreement and the normal rules of construction to the effect
that any ambiguities are to be resolved against the drafting party shall not be
employed in the interpretation of this Agreement.
15.15. APPLICABLE LAW. This Agreement shall be construed in accordance
with, and governed by, the laws of the State of Delaware.
IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be duly executed as of the date first above written.
Xxx-Xxxx.xxx, Inc.
a Delaware corporation
By:
-------------------------------
Its:
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[Rights Agent]
By:
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