Exhibit 4.1


 


AMENDMENT NO. 2 TO RIGHTS AGREEMENT


 


This Amendment No. 2 to Rights Agreement (this “Amendment”) is
entered into as of June 11, 2004 (to become effective on the date set forth in
Section 6 of this Amendment), between WATER PIK TECHNOLOGIES, INC., a Delaware
corporation (the “Company”), and MELLON INVESTOR SERVICES LLC, a New
Jersey limited liability company (the “Rights Agent”), and amends the
Rights Agreement dated as of November 12, 1999, between the Company and the
Rights Agent, as amended by Amendment No. 1 to Rights Agreement dated as of
December 28, 2000 (the “Rights Agreement”).


 


WHEREAS, the Company desires to amend the Rights Agreement to provide
for the redemption of the Rights and termination of the Rights Agreement by
action of the stockholders of the Company upon consummation of an offer for the
Common Shares of the Company that meets certain predetermined criteria, subject
to the terms and conditions set forth in this Amendment; and


 


WHEREAS, this Amendment is entered into pursuant to Section 27 of the
Rights Agreement prior to the time that any Person, to the knowledge of the
Company, has become as Acquiring Person.


 


NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:


 


1.             Defined
Terms.  Terms defined in the Rights
Agreement and used and not otherwise defined herein shall have the meanings
given to them in the Rights Agreement.


 


2.             Amendment
of Definition of Acquiring Person. 
The first sentence of the definition of Acquiring Person contained in
Section 1(a) of the Rights Agreement shall be replaced in its entirety by a new
first sentence to read 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 ATI, the Company or of any Subsidiary of the Company, any entity
holding Common Shares for or pursuant to the terms of any such plan, or any
Person who becomes a Beneficial Owner of at least 75% of the Common Shares of
the Company then outstanding as a result of the consummation of a Qualified
Offer.”


 


3.             Addition
of Qualified Offer Definition. 
Section 1 of the Rights Agreement is hereby further amended to add the
following definition, which shall be inserted into Section 1 in alphabetical
order:


 


“Qualified Offer” shall mean an all-cash
tender offer for all outstanding Common Shares of the Company that meets all of
the following requirements:


 


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(i) 
on or prior to the date such offer is commenced within the meaning of
Rule 14d-2(a) of the General Rules and Regulations under the Exchange Act, the
Person making such offer:


 


(A) 
has on hand cash or cash equivalents for the full amount necessary to
consummate such offer and has irrevocably committed in writing to the Company
to utilize such cash or cash equivalents for purposes of such offer if
consummated and to set apart and maintain available such cash or cash
equivalents for such purposes until the offer is consummated or withdrawn; or


 


(B) 
has all financing in the full amount necessary to consummate such offer
and has:


 


(1) 
entered into, and provided to the Company certified copies of,
definitive financing agreements (including exhibits and related documents) for
funds for such offer which, when added to the amount of cash and cash
equivalents available, committed in writing, set apart and maintained in the
same manner as described in clause (A) above, are in an amount not less than
the full amount necessary to consummate such offer, which agreements are with
one or more responsible financial institutions or other entities having the
necessary financial capacity and ability to provide such funds, and are subject
only to customary terms and conditions (which shall in no event include
conditions requiring access by such financial institutions or other entities to
non-public information to be provided by the Company, conditions based on the
accuracy of any information concerning the Company, or conditions requiring the
Company to make any representations, warranties or covenants in connection with
such financing), and


 


(2) 
provided to the Company copies of all written materials prepared by such
Person for such financial institutions or other entities in connection with
entering into such financing agreements; provided that, “the full amount
necessary to consummate such offer” in either clause (A) or (B) above shall be
an amount sufficient to pay for all Common Shares outstanding on a fully
diluted basis in cash pursuant to the offer and all related expenses;


 


(ii) 
such offer remains open for at least 120 calendar days;


 


(iii) 
the price to be paid to holders of Common Shares pursuant to the offer
is greater than or equal to the higher of (a) 150% of the average closing price
of the Common Shares during the 90 calendar days preceding the date the offer
commences and (b) 135% of the highest closing price of the Common Shares during
the 24 months preceding the date the offer commences (the term “closing price”
shall have the meaning set forth in the second to last sentence of Section
11(d)(i) of the Rights Agreement);


 


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(iv) 
such offer is supported by a written opinion, in customary form, of a
nationally recognized investment banking firm designated by the Company that is
not being compensated on a “percentage of the deal” basis, which opinion must
(a) be addressed to the Company and the holders of Common Shares, (b) state
that the price to be paid to holders pursuant to the offer is fair from a
financial point of view to such holders, and (c) include any written
presentation of such firm showing the analysis and range of values underlying
such conclusions; such written opinion and such presentation must be updated
and provided to the Company within two Business Days prior to the date such
offer is consummated;


 


(v) 
such offer must include a non-waivable and non-amendable condition that
such offer will not be consummated unless the Person making such offer will
own, after consummating such offer, at least 75% of the Common Shares then
outstanding;


 


(vi) 
prior to or upon commencing such offer, the Person making such offer
must irrevocably commit in writing to the Company and in the offer to purchase
relating to the offer:


 


(A) to, immediately upon consummation of the
Qualified Offer, cause all of the Common Shares held by such Person and all of
the Common Shares acquired by such Person as a result of the consummation of
the offer to be voted at a special meeting of the stockholders of the Company,
or any other means of taking stockholder action then permitted by the Company’s
certificate of incorporation or bylaws, in favor of a proposal or resolution to
redeem all but not less than all of the outstanding Rights at the Redemption
Price and terminate the Rights Agreement, which redemption and termination
shall be effective immediately following such stockholder vote,


 


(B) to, immediately upon consummation of the
Qualified Offer, consummate a transaction whereby all Common Shares then
outstanding and not tendered into the offer will be acquired at the same price
per share and for the same consideration paid pursuant to the offer, and
otherwise not to purchase any Common Shares following consummation of the
offer,


 


(C) that such Person will not materially
amend such offer, except to increase the price offered, and no amendment shall
have any adverse effect on the holders or change any of the terms required for
such offer to be a Qualified Offer as set forth herein, and


 


(D) that such Person will not make any offer
for any equity securities of the Company for twelve months after commencement
of the original offer if the original offer does not result in the tender of
the number of shares required to be purchased pursuant to subsection (v) above
or is not consummated for any reason, unless another Qualified Offer with a per
share offer price at least 10% higher than the last price offered by the Person
making the original offer is commenced by another Person or Persons who are not
Affiliates or Associates of, acting in concert with, or instigated or financed
by, the Person making the original offer or


 


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with whom the
Person making the original offer has any agreement, arrangement or
understanding relating to the Company or any assets or securities of it or any
of its Subsidiaries; and


 


(vii) 
in addition to each of the requirements set forth above, such offer is
not subject to any condition relating to completion of or satisfaction with any
due diligence or similar investigation, and, subject to the foregoing,
otherwise provides for usual and customary terms and conditions.”


 


4.             Amendment
of Section 3.  The first sentence of
Section 3(a) shall be replaced in its entirety by a new first sentence of
Section 3(a) to read as follows:


 


“(a) Until the earlier of (i) the Shares Acquisition
Date or (ii) the tenth business day (or such later date as may be determined by
action of the Board of Directors prior to such time as any Person becomes an
Acquiring Person) after the date of the commencement or the announcement of an
intention to commence by any Person (other than the Company, any Subsidiary of
the Company, any employee benefit plan of the Company or of any Subsidiary of
the Company or any entity holding Common Shares for or pursuant to the terms of
any such plan) of a tender or exchange offer the consummation of which would
result in any Person becoming an Acquiring Person (including any such date
which is after the date of this Rights Agreement and prior to the issuance of
the Rights; the earlier of such dates being herein referred to as the
“Distribution Date”), (x) the Rights will be evidenced (subject to the
provisions of Section 3(b)) by the certificates for Common Shares registered in
the names of the holders thereof (which certificates shall also be deemed to be
Right Certificates) and not by separate Right Certificates, and (y) the right
to receive Right Certificates will be transferable only in connection with the
transfer of Common Shares.”


 


5.             Amendment
of Section 13.  Section 13 of the
Rights Agreement is hereby amended by adding the following new paragraph at the
end of Section 13 (as a separate paragraph):


 


“Notwithstanding anything in this Agreement to the contrary, this
Section 13 shall not be applicable to any transaction described in clauses (a)
or (b) of the first paragraph of this Section 13 if (i) such transaction is
consummated with a Person or Persons who acquired Common Shares of the Company
pursuant to a Qualified Offer, (ii) the consideration per Common Share of the
Company offered in such transaction is not less than the consideration per
Common Share paid to holders of Common Shares pursuant to such Qualified Offer,
and (iii) the form of consideration per Common Share of the Company offered in
such transaction is the same as the form of consideration paid to holders of
Common Shares pursuant to such Qualified Offer.”


 


6.             Effectiveness.  This Amendment shall be deemed effective
immediately following the 2005 Annual Meeting of Stockholders of the
Company.  Except as amended hereby, the
Rights Agreement shall remain in full force and effect and shall be otherwise
unaffected hereby.


 


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7.             Miscellaneous.  This Amendment shall be deemed to be a
contract made under the laws of the State of Delaware and for all purposes
shall be governed by and construed in accordance with the laws of such
state.  This Amendment may be executed
in any number of counterparts, each of such counterparts shall for all purposes
be deemed an original and all such counterparts shall together constitute but
one and the same instrument.


 


IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2
to the Rights Agreement to be duly executed and attested, all as of the day and
year first above written.


 


 


	
  Attest:

  	
  WATER PIK TECHNOLOGIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
     /s/  RICHARD D. TIPTON

  	
   

  	
  By:

  	
     /s/  MICHAEL P. HOOPIS 

  	
   

  
	
   

  	
  Name: Richard D. Tipton

  	
  Name:

  	
  Michael P. Hoopis

  
	
   

  	
  Title:   Vice President,
  General Counsel

  and Secretary

  	
  Title:

  	
  President and CEO

  
	
   

  	
   

  
	
   

  	
   

  
	
  Attest:

  	
  MELLON INVESTOR SERVICES LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
     /s/  SHARON KNEPPER

  	
   

  	
  By:

  	
     /s/  JAMES KIRKLAND

  	
   

  
	
   

  	
  Name:  Sharon Knepper

  	
  Name:

  	
  James Kirkland

  
	
   

  	
  Title:    Vice President

  	
  Title:

  	
  Assistant Vice President

  
											



 


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