Shareholder Rights Letter and Plan
The following are the letter and Shareholder Rights Plan Plan sent out by Cymer. This is a machine-converted scan, so I'm sorry if there are any weirdnesses. I fixed whichever ones I saw, but some may have eluded me.
***************** Letter ****************************
March 30, 1998
To Our Stockholders:
Your Board of Directors has declared a dividend distribution of Preferred Shares Purchase Rights. This letter describes the Preferred Shares Purchase Rights Plan and the Board of Director's reasons for adopting it. The accompanying Summary of Terms describes the terms of the Rights as set forth in the Rights Agreement pursuant to which the Rights have been issued.
The Rights are designed to protect and maximize the value of your interest in the Company. We believe that the Rights Plan, while not intended to prevent a takeover, will provide protection to you, our stockholders, from the abusive and coercive tactics that often occur in takeover attempts.
The Rights contain provisions to protect stockholders in the event of an unsolicited takeover attempt through such methods as a gradual accumulation of shares in excess of 15% of the outstanding stock followed by a two-tier tender offer or other tactics that do not treat all stockholders equally. These tactics may unfairly pressure stockholders, deprive them of the full value of their shares, or squeeze them out of their investment without giving them any real choice. With over 1700 other companies having established rights plans to protect stockholders, we consider the Rights Plan to be the best available means of protecting the full value of your investment in the Company, while not preventing a fair acquisition offer for the Company.
The Rights will initially trade with shares of the Company's Common Stock and have no impact on the way in which you can presently trade the Company's shares. As explained in detail in the attached Summary of Rights, the Rights are not exercisable until ten days after a person or group announces acquisition of 15% or more of the Company's outstanding Common Stock or the commencement of a tender offer which would result in ownership by the person or group of 15% or more of the outstanding Common Stock.
In implementing this Rights Plan, we have exercised our continued confidence in the -Company's future and our determination that you, our stockholders, be given every opportunity to participate fully in that future.
On behalf of the Board of Directors,
Robert P. Akins, President, Chief Executive Officer
and Chairman of the Board
******************* Plan ***********************
STOCKHOLDER RIGHTS PLAN
CYMER, INC,
Summary of Rights
Distribution and Transfer of Rights, Rights Certificate:
The Board of Directors has declared a dividend of one Right for each share of Cymer, Inc. Common Stock outstanding. Prior to the Distribution Date referred to below, the Rights will be evidenced by and trade with the certificates for the Common Stock. After the Distribution Date, Cymer, Inc. (the "Company") will mail Rights Certificates to the Company's stockholders and the Rights become transferable apart from the Common Stock.
Distribution Date:
Rights will separate from the Common Stock and become exercisable following (a) the tenth day after a person or group acquires beneficial ownership of 15% or more of the Company's Common Stock or (b) the tenth business day (or such later date as may be determined by the Company's Board of Directors) after a person or group announces a tender or exchange offer, the consummation of which would result in ownership by a person or group of 15% or more of the Company's Common Stock.
Preferred Stock Purchasable Upon Exercise of Rights:
After the Distribution Date, each Right will entitle the holder to purchase for $100.00 (the "Exercise Price"), a fraction of a share of the Company's Preferred Stock with economic terms similar to that of one share of the Company's Common Stock.
Flip-In:
If an acquiror (an "Acquiring Person ") obtains 15% or more of the Company's Common Stock then each Right (other than Rights owned by an Acquiring Person or its affiliates) will entitle the holder thereof to purchase, for the Exercise Price, a number of shares of the Company's Common Stock having a then current market value of twice the Exercise Price.
Flip-Over:
If, after an Acquiring Person obtains 15% or more of the Company's Common Stock, (a) the Company merges into another entity, (b) an acquiring entity merges into the Company or (c) the Company sells more than 50% of the Company's assets or earning power, then each Right (other than Rights owned by an Acquiring Person or its affiliates) will entitle the holder thereof to purchase, for the Exercise Price, a number of shares of Common Stock of the person engaging in the transaction having a then current market value of twice the Exercise Price.
Exchange Provision:
At any time after the date an Acquiring Person obtains 15% or more of the Company's Common Stock and prior to the acquisition by the Acquiring Person of 50% of the outstanding Common Stock, the Company's Board of Directors may exchange the Rights (other that, Rights owned by the Acquiring Person or its affiliates), in whole or in part, for shares of Common Stock of the Company at an exchange ratio of one share of Common Stock per Right (subject to adjustment).
Redemption of the Rights:
Rights will be redeemable at the Company's option for $0.01 per Right at any time on or prior to public announcement that a Person has acquired beneficial ownership of 15% or more of the Company's Common Stock (the "Shares Acquisition Date").
Expiration of the Rights:
The Rights expire on the earliest of (a) February 13, 2008 or (b) exchange or redemption of the Rights as described above.
Amendment of Terms of Rights:
The terms of the Rights and the Rights Agreement may be amended in any respect without the consent of the Rights holders on or prior to the Distribution Date; thereafter, the terms of the Rights and the Rights Agreement may be amended without the consent of the Rights holders in order to cure any ambiguities or to make changes which do not adversely affect the interests of the Rights Agent or Rights holders (other than the Acquiring Person).
Voting Rights:
Rights will not have any voting rights.
Anti-Dilution Provisions:
Rights will have the benefit of certain customary anti-dilution visions.
Taxes:
The Rights distribution should not be taxable for federal income tax purposes. However, following an event which renders the Rights exercisable or upon redemption of the Rights, stockholders may recognize taxable income.
The foregoing is a summary of certain principal terms of the Stockholder Rights Plan only and is qualified in its entirety by reference to the detailed terms of the Rights Agreement dated as of February 13, 1998, between the Company and the Rights Agent.
THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN SECTION 7(e) OF THE RIGHTS AGREEMENT BETWEEN CYMER, INC. AND CHASEMELLON SHAREHOLDER SERVICES, L.L.C. DATED AS OF FEBRUARY 13, 1998. |
