any manner, except pursuant to (i) the exercise of stock options granted
pursuant to the Company's existing and future stock option plans, and (ii) the
exercise of conversion rights contained in specified stock issues of the
Company), or (b) the Board declares any person to be an adverse person upon a
determination that such person has become the beneficial owner of a substantial
amount of Common Shares (which shall in no event be less than 10% of the Common
Shares then outstanding), the Rights Agreement provides that proper provision
shall be made so that each holder of a Right will thereafter be entitled to
receive, upon exercise, Common Shares (or, in certain circumstances, cash,
property or other securities of the Company) having a value equal to two times
the exercise price of the Right.
In the event that, at any time following the first date of
public announcement by the Company or an Acquiring Person indicating that an
Acquiring Person has become such (the "Shares Acquisition Date"), (a) the
Company engages in a merger or other business combination transaction in which
the Company is not the surviving corporation, (b) the Company engages in a
merger or other business combination transaction with another person in which
the Company is the surviving corporation, but in which its Common Shares are
changed or exchanged or (c) 50% or more of the Company's assets or earning power
is sold or transferred, the Rights Agreement provides that proper provision
shall be made so that each holder of a Right shall thereafter have the right to
receive, upon the exercise thereof at the then current exercise price of the
Right, common shares of the acquiring company having a value equal to two times
the exercise price of the Right.
The Board may, at its option, at any time after the right of
the Board to redeem the Rights has expired or terminated (with certain
exceptions), exchange all or part of the then outstanding and exercisable Rights
(other than those held by the Acquiring Person) for Common Shares at a ratio of
one Common Share per Right, as adjusted; provided, however, that such Right
cannot be exercised once a Person, together with such Person's Affiliates and
Associates, becomes the owner of 50% or more of the outstanding Common Shares.
If the Board authorizes such an exchange, the Rights will immediately cease to
be exercisable.
Notwithstanding any of the foregoing, following the occurrence of any
of the events set forth in the fourth and fifth paragraphs hereof, any Rights
that are, or (under certain circumstances specified in the Rights Agreement)
were, beneficially owned by any Acquiring Person shall immediately become null
and void. The Rights Agreement contains provisions intended to prevent the
utilization of voting trusts or similar arrangements (except for a contemplated
voting arrangement between two of the Company's principal stockholders) that
could have the effect of rendering ineffective or circumventing the beneficial
ownership rules set forth in the Rights Agreement.
The Purchase Price payable, and the number of Series A Shares or other
securities or property issuable, upon exercise of the Rights are subject to
adjustment from time to time to prevent dilution (a) in the event of a dividend
of Series A Shares on, or a
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