EX-4.2 3 november19ex4-2.txt AMENDMENT NO. 1 TO RIGHTS AGREEMENT Exhibit 4.2 AMENDMENT NO. 1 TO RIGHTS AGREEMENT AMENDMENT No. 1, dated as of November 18, 2001, to the Rights Agreement (the "Rights Agreement"), dated as of August 1, 1999, between Phillips Petroleum Company, a Delaware corporation (the "Company") and Mellon Investor Services LLC (as successor to ChaseMellon Shareholder Services, L.L.C.), as Rights Agent (the "Rights Agent"). WHEREAS, the Company and the Rights Agent have heretofore executed and entered into the Rights Agreement; and WHEREAS, pursuant to Section 27 of the Rights Agreement, the Company may from time to time supplement or amend the Rights Agreement in accordance with the provisions of Section 27 thereof; and WHEREAS, the Company intends to enter into an Agreement and Plan of Merger (as it may be amended or supplemented from time to time, the "Merger Agreement"), dated as of November 18, 2001, by and among the Company, CorvettePorsche Corp., a Delaware corporation ("New Parent"), Porsche Merger Corp., a Delaware corporation and direct wholly owned subsidiary of New Parent ("Merger Sub One"), Corvette Merger Corp., a Delaware corporation and direct wholly owned subsidiary of New Parent ("Merger Sub Two"), and Conoco Inc., a Delaware corporation ("Conoco") (all capitalized terms used in this Amendment and not otherwise defined herein shall have the meaning ascribed thereto in the Merger Agreement); and WHEREAS, the Board of Directors has (i) determined that the Merger Agreement and the transactions contemplated thereby are advisable, fair to and in the best interests of the Company and its stockholders, (ii) approved the Agreement and (iii) recommended that this Agreement be adopted by the holders of Phillips Common Stock; and WHEREAS, the Board of Directors has found that it is in the best interests of the Company and its stockholders, and has deemed it necessary and desirable, to amend the Rights Agreement to exempt the Merger Agreement and the transactions contemplated thereby from the application of the Rights Agreement. NOW, THEREFORE, the Company hereby amends the Rights Agreement as follows: 1. Section 1(a) of the Rights Agreement is hereby modified, amended and restated in its entirety as follows: "Acquiring Person" shall mean any Person who or which, together with all Affiliates and Associates of such Person, shall be the Beneficial Owner of 15% or more of the Common Shares of the Company then outstanding, but shall not include the Company, any Subsidiary of the Company, any employee benefit plan of the Company or any Subsidiary of the Company, or any entity holding Common Shares for or pursuant to the terms of any such plan. 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 Common Shares of the Company outstanding, increases the proportionate number of Common Shares of the Company beneficially owned by such Person to 15% or more of the Common Shares of the Company then outstanding; provided, however, that, if a Person shall become the Beneficial Owner of 15% or more of the Common Shares of the Company then outstanding by reason of share purchases by the Company and shall, after such share 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, (i) 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 paragraph (a), 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 paragraph (a), then such Person shall not be deemed to be an "Acquiring Person" for any purposes of this Agreement and (ii) neither Conoco Inc., a Delaware corporation ("Conoco"), CorvettePorsche Corp., a Delaware corporation ("New Parent"), Porsche Merger Corp., a Delaware corporation and direct wholly owned subsidiary of New Parent ("Merger Sub One") or Corvette Merger Corp., a Delaware corporation and direct wholly owned subsidiary of New Parent ("Merger Sub Two"), shall be deemed to be an Acquiring Person by virtue of: (A) the execution and delivery of the Agreement and Plan of Merger (as it may be amended or supplemented from time to time, the "Merger Agreement") entered into as of November 18, 2001, by and among the Company, New Parent, Merger Sub One, Merger Sub Two and Conoco, (B) the conversion of Common Shares into the right to receive the Phillips Merger Consideration (as defined in the Merger Agreement) in accordance with Section 3.1 of the Merger Agreement, or (C) the consummation of the Phillips Merger or the Conoco Merger (as defined in the Merger Agreement) (each of the events set forth in foregoing clauses (A) to (C), an "Exempt Event"). 2. Section 1(u) of the Rights Agreement is hereby modified and amended by adding the following sentence at the end thereof: "No Exempt Event shall cause a Shares Acquisition Date." 3. Section 3(a) of the Rights Agreement is hereby modified and amended by adding the following sentence at the end thereof: "Notwithstanding the foregoing, no Exempt Event shall cause a Distribution Date." 4. Section 7(a) of the Rights Agreement is hereby modified, amended and restated in its entirety as follows: -2- The registered holder of any Right Certificate may exercise the Rights evidenced thereby (except as otherwise provided herein), in whole or in part, at any time after the Distribution Date, upon surrender of the Right Certificate, with the form of election to purchase on the reverse side thereof duly and properly executed, to the Rights Agent at the office of the Rights Agent, together with payment of the Purchase Price for each one one-hundredth of a Preferred Share as to which the Rights are exercised, at or prior to the earliest of (i) the time immediately prior to the consummation of the Phillips Merger and the Conoco Merger, (ii) the Close of Business on July 31, 2009 (the "Final Expiration Date"), (iii) the time at which the Rights are redeemed as provided in Section 23 hereof (the "Redemption Date"), or (iv) the time at which such Rights are exchanged as provided in Section 24 hereof. 5. Section 29 of the Rights Agreement is hereby modified and amended to add the following sentence at the end thereof: "Notwithstanding the foregoing, nothing in this Agreement shall be construed to give any holder of Rights or any other Person any legal or equitable rights, remedy or claim under this Agreement in connection with any transactions contemplated by the Merger Agreement." 6. This Amendment may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute one and the same instrument. * * * [SIGNATURE PAGE FOLLOWS] -3- IN WITNESS WHEREOF, this Amendment has been duly executed by the Company and the Rights Agent as of the day and year first written above. Attest: PHILLIPS PETROLEUM COMPANY By /s/ Robert B. Koch By /s/ J. Bryan Whitworth -------------------------- ------------------------------- Name: Robert B. Koch Name: J. Bryan Whitworth Title: Senior Counsel Title: Executive Vice President MELLON INVESTOR SERVICES LLC Attest: (As Rights Agent) By /s/ Marie Sandauer By /s/ Gary D' Allesandro --------------------------- -------------------------------- Name: Marie Sandauer Name: Gary D' Alessandro Title: Vice President Title: Vice President -4-