exv4w1



 





Exhibit 4.1




AMENDMENT TO STOCKHOLDERS RIGHTS PLAN




AMENDMENT NO. 1 TO 

 RIGHTS AGREEMENT




     This Amendment No. 1 to Rights Agreement (this “Amendment”), is entered into on April 27, 2007
and effective as of October 18, 2006, between Virco Mfg. Corporation, a Delaware corporation (the
“Company”), and Mellon Investor Services LLC, as successor to The Chase Manhattan Bank (the “Rights
Agent”). This Amendment amends that certain Rights Agreement, dated as of October 18, 1996 (the
“Agreement”), between the Company and the Rights Agent. Capitalized terms used herein and not
otherwise defined shall have the meanings given to such terms in the Agreement.



RECITALS




     WHEREAS, the Company previously authorized, declared and paid a dividend of one preferred
stock purchase right (a “Right”) for each share of common stock, par value .01 per share, of the
Company subject to the terms and conditions of the Agreement;



     WHEREAS, pursuant to the Agreement, the Rights will expire on October 25, 2006;




     WHEREAS, the Board of the Directors of the Company deems it to be in the best interests of the
Company to amend the Agreement, in accordance with the terms hereof, to extend the term of the
Rights and to make such other changes as provided herein; and



     WHEREAS, the Company and the Rights Agent desire to enter into this Amendment to extend the
term of the Rights and to make such other changes as provided herein.



     NOW, THEREFORE, in consideration of the mutual promises and covenants hereinafter set forth,
the Company and the Rights Agent hereby agree as follows:



AGREEMENT




     1. Section 1(n) of the Agreement is hereby deleted in its entirety and replaced with the
following:




     “(n) “Expiration Date” shall mean October 25, 2016, unless the
Distribution Date shall occur on or prior to such date and the Rights shall
have been separated from the Common Shares pursuant to the terms of this
Agreement, in which case “Expiration Date” shall mean the date which is the
tenth anniversary of the Distribution Date.”



     2. The first sentence of Section 2 of the Agreement is hereby deleted in its entirety and
replaced with the following:




     “The Company hereby appoints the Rights Agent to act as rights agent for the
Company in accordance with the terms and conditions hereof, and the Rights Agent
hereby accepts such appointment.”



     3. The references to “The Chase Manhattan Bank” in Section 3(e) and Section 3(f) of the
Agreement are hereby deleted and replaced with “Mellon Investor Services LLC.”



     4. Section 3 of the Agreement is hereby amended by inserting the following as Section 3(i)
thereof:




     “(i) The Company shall promptly notify the Rights Agent in writing upon the
occurrence of the Distribution Date and, if such notification is given orally, the
Company shall confirm same in writing



 









 







on or prior to the Business Day next following. Until such notice is received
by the Rights Agent, the Rights Agent may presume conclusively for all purposes that
the Distribution Date has not occurred.”



     5. Section 4 of the Agreement is hereby amended by inserting “(but which do not affect the
rights, duties or responsibilities of the Rights Agent)” after the phrase “as the Company may deem
appropriate”.



     6. The references to “in New York, New York” in Section 5(b) and Section 7(b) of the Agreement
are hereby deleted and replaced with “designated for such purpose.”



     7. The following sentence is hereby added as the last sentence of Section 6(a) of the
Agreement:




     “The Rights Agent shall have no duty or obligation under this Section unless and
until it is satisfied that all such taxes and/or charges have been paid.”



     8. Section 11(c) of the Agreement is hereby amended by inserting “(as determined in good faith
by the Board of Directors of the Company, whose determination shall be described in a statement
filed with the Rights Agent)” after the phrase “over and above the fair market value”.



     9. Section 11(i) of the Agreement is hereby amended by inserting “(with prompt written notice
to the Rights Agent) after the phrase “make a public announcement”.



     10. Section 11(l) of the Agreement is hereby amended by inserting “(with prompt written notice
thereof to the Rights Agent)” after the phrase “the Company may elect to defer”.



     11. Section 12 of the Agreement is hereby deleted in its entirety and replaced with the
following:




     “Whenever an adjustment is made or any event affecting the Rights or their
exercisability (including without limitation an event which causes Rights to become
null and void) occurs as provided in Section 11 or 13 hereof, the Company shall
promptly (a) prepare a certificate setting forth such adjustment or describing such
event, and a brief, reasonably detailed statement of the facts, computations and
methodology accounting for any adjustment, (b) file with the Rights Agent and with
each transfer agent for the securities issuable upon exercise of the Rights a copy of
such certificate and (c) mail a brief summary thereof to each holder of Rights in
accordance with Section 25 and Section 26 hereof. The Rights Agent shall be fully
protected in relying on any such certificate and on any adjustment or statement
therein contained and shall have no duty or liability with respect to, and shall not
be deemed to have knowledge of, any adjustment or any such event unless and until it
shall have received such a certificate.”



     12. Section 14 of the Agreement is hereby amended by inserting the following as Section 14(d)
thereof:




     “(d) Whenever a payment for fractional Rights or fractional shares is to be made
by the Rights Agent, the Company shall (i) promptly prepare and deliver to the Rights
Agent a certificate setting forth in reasonable detail the facts related to such
payments and the prices and/or formulas utilized in calculating such payments, and
(ii) provide sufficient monies to the Rights Agent in the form of fully collected
funds to make such payments. The Rights Agent shall be fully protected in relying
upon such a certificate and shall have no duty with respect to, and shall not be
deemed to have knowledge of any payment for fractional Rights or fractional shares
under any Section of this Agreement relating to the payment of fractional Rights or
fractional shares unless and until the Rights Agent shall have received such a
certificate and sufficient monies.”



     13. Section 15 of the Agreement is hereby amended by inserting “and Section 20 hereof” after
the phrase “Section 18”.



     14. Section 15 of the Agreement is hereby amended by inserting the following as Section 15(b)
thereof:




     “(b) Notwithstanding anything in this Agreement to the contrary, neither the
Company nor



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the Rights Agent shall have any liability to any holder of a Right or
other Person as a result of its inability to perform any of its obligations under
this Agreement by reason of any preliminary or permanent injunction or other order,
judgment, decree or ruling (whether interlocutory or final) issued by a court or
by a governmental, regulatory, self-regulatory or administrative agency or
commission, or any statute, rule, regulation or executive order promulgated or
enacted by any governmental authority, prohibiting or otherwise restraining
performance or such obligation.”



     15. Section 18(a) of the Agreement is hereby deleted in its entirety and replaced with the
following:




     “(a) The Company agrees to pay the Rights Agent reasonable compensation for all
services rendered by it hereunder and, from time to time, on demand of the Rights
Agent, its reasonable expenses and counsel fees and other disbursements incurred in
the preparation, delivery, amendment, administration and execution of this Agreement
and the exercise and performance of its duties hereunder. The Company also agrees to
indemnify the Rights Agent for, and to hold it harmless against, any loss, liability,
damage, judgment, fine, penalty, claim, demand, settlement, cost or expense
(including, without limitation, the reasonable fees and expenses of legal counsel),
incurred without gross negligence or bad faith on the part of the Rights Agent (which
gross negligence or bad faith must be determined by a final, non-appealable order,
judgment, decree or ruling of a court of competent jurisdiction), for any action
taken, suffered, or omitted by the Rights Agent in connection with the acceptance,
administration, exercise and performance of its duties under this Agreement. The
costs and expenses incurred in enforcing this right of indemnification shall be paid
by the Company. The provisions of this Section 18 and Section 20 below shall survive
the termination of this Agreement, the exercise or expiration of the Rights and the
resignation, replacement or removal of the Rights Agent.”



     16. Any and all references to “corporation” in Section 19 of the Agreement are hereby deleted
and replaced with references to “Person”.



     17. The reference to “corporate trust or stock transfer” in Section 19 of the Agreement is
hereby deleted and replaced with a reference to “shareholder services”.



     18. Section 20(c) of the Agreement is hereby amended by inserting the following at the end of
Section 20(c):




     “Any liability of the Rights Agent under this Agreement will be limited to four
(4) times the amount of annual fees paid by the Company to the Rights Agent.”



     19. Section 20(c) of the Agreement is hereby amended by inserting “(which negligence, bad
faith or willful misconduct must be determined by a final, non-appealable order, judgment, decree
or ruling of a court of competent jurisdiction”) after the phase “negligence, bad faith or willful
misconduct.”)



     20. Section 20(i) of the Agreement is hereby amended by deleting “provided that reasonable
care was exercised in the selection thereof” and replacing it with the following:




     “absent gross negligence or bad faith in the selection and continued employment
thereof (which gross negligence or bad faith must be determined by a final,
non-appealable order, judgment, decree or ruling of a court of competent
jurisdiction).”



     21. Section 20(g) of the Agreement is hereby amended by deleting the phrase “and it shall not
be liable for any action taken or suffered by it in good faith in accordance with the instructions
of any such officer” and replacing it with the following:




     “and the Rights Agent shall not be liable for or in respect of any action taken,
suffered or omitted by it in accordance with instructions of any such officer or for
any delay in acting while waiting for those instructions. The Rights Agent shall be
fully authorized and protected in relying upon the most recent instructions received
by any such officer. Any application by the Rights Agent for written instructions



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from the Company may, at the option of the Rights Agent, set forth in writing any
action proposed to be taken, suffered or omitted by the Rights Agent under this
Agreement and the date on and/or after which such action shall be taken or suffered
or such omission shall be effective.”



     22. Section 20 of the Agreement is hereby amended by inserting the following as Section 20(j)
thereof.




     “(j) No provision of this Rights Agreement shall require the Rights Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if it
reasonably believes that repayment of such funds or adequate indemnification against
such risk or liability is not reasonably assured to it.”



     23. Any and all references to “corporation” in Section 21 of the Agreement are hereby deleted
and replaced with references to “Person”.



     24. Section 21 of the Agreement is hereby amended by inserting the following at the end of the
fifth sentence of Section 21:




     “or an Affiliate of such a Person.”



     25. Section 23(a) of the Agreement is hereby deleted in its entirety and replaced with the
following:




     “(a) Until the earliest of (i) the date of the first Section 11(a)(ii)
Event, (ii) the date of the first Section 13(a) Event or (iii) the Expiration
Date, the Board of Directors of the Company may, at its option, authorize and
direct the redemption of all, but not less than all, of the then outstanding
Rights at a redemption price of $.001 per Right, as such redemption price
shall be appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the date hereof (the “Redemption Price”),
and the Company shall so redeem the Rights.”



     26. The following is hereby added as the second sentence of Section 23(b) of the Agreement:




     “The Company shall promptly give public notice of any such redemption (with
prompt written notice thereof to the Rights Agent).”



     27. The following is hereby added as the second sentence of Section 24(b) of the Agreement:




     “The Company shall promptly given public notice of any such exchange (with
prompt written notice thereof to the Rights Agent.”



     28. The provision of Section 26 of the Agreement relating to the address of the Rights Agent
is hereby deleted in its entirety and replaced with the following:


“Mellon Investor Services LLC

600 N. Pearl Street

Suite 1010

Dallas, TX 75201

Attention: Relationship Manager

Facsimile No.: (214) 922-4477



With a copy to:



Mellon Investor Services LLC

Newport Office Center VII

480 Washington Blvd.

Jersey City, New Jersey 07310

Facsimile No.: (201) 680-4610”




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     29. Section 27(a) of the Agreement is hereby amended by adding the following before the phrase
“the Rights Agent shall so supplement”:




     “, upon receipt of a certificate from an appropriate officer of the
Company that states that the proposed supplement or amendment complies with
this Section 27,”



     30. Section 27(a) of the Agreement is hereby amended by adding the following at the
end of Section 27(a):




     “Notwithstanding anything contained in this Agreement to the contrary,
the Rights Agent may, but is not obligated to, enter into any supplement or
amendment that affects the Rights Agent’s own rights, duties, obligations or
immunities under this Agreement.”



     31. The proviso in Section 32 of the Agreement is hereby deleted in its entirety and replaced
with the following:




     “provided, however, that all provisions regarding the rights, duties and
obligations of the Rights Agent shall be governed by and construed in accordance with
the laws of the State of New York applicable to contracts made and to be performed
entirely within such State.”



     32. The reference to “October 25, 2006” in the block header of Exhibit B to the Agreement is
hereby replaced with a reference to “October 25, 2016”.



     33. The reference to “October 25, 2006” in the first paragraph of Exhibit B to the Agreement
is hereby replaced with a reference to “October 25, 2016.”



     34. The references to “The Chase Manhattan Bank” in Exhibit B are hereby replaced with
references to “Mellon Investor Services LLC.”



     35. Section 4 of Exhibit C to the Agreement is hereby deleted in its entirety and replaced
with the following:




     “The Rights shall expire on October 25, 2016, unless earlier redeemed or
exchanged, unless the Distribution Date has previously occurred and the
Rights have separated from the Common Shares, in which case the Rights will
remain outstanding for ten years.”



     36. 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 applicable to contracts made and performed entirely within such State; provided,
however, that with respect solely to matters regarding the rights and obligations of the Rights
Agent hereunder, the laws of the State of New York shall govern.



     37. This Amendment may be executed by facsimile signature and in two or more counterparts,
each of which shall constitute an original, but all of which, when taken together, shall constitute
one instrument.



     38. Except as expressly provided in this Amendment, all terms and provisions of the Agreement
shall remain unmodified and in full force and effect.



[signature page follows]




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IN WITNESS WHEREOF, this Amendment is entered into as of the date first above written.




	 	 	 	 	 	 	 
	 	 	VIRCO MFG. CORPORATION,

a Delaware corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	MELLON INVESTOR SERVICES LLC,
 as Rights Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title: