Exhibit 4.1
GENERAL SEMICONDUCTOR, INC.
CERTIFICATE OF DESIGNATION, PREFERENCES
AND RIGHTS OF SERIES A JUNIOR PARTICIPATING
PREFERRED STOCK
(Pursuant to Section 151
of the General Corporation Law of the State of Delaware)
I, Stephen B. Paige, Senior Vice President, General Counsel and Secretary
of General Semiconductor, Inc., a corporation organized and existing under the
General Corporation Law of the State of Delaware (the "Corporation"), in
accordance with the provisions of Section 103 thereof, do hereby certify:
That pursuant to the authority conferred upon the Board of Directors by the
Corporation's Restated and Amended Certificate of Incorporation (the
"Certificate of Incorporation"), the Board of Directors on January 6, 1997,
adopted the following resolution creating a series of 400,000 shares of
Preferred Stock designated as Series A Junior Participating Preferred Stock:
WHEREAS, the Certificate of Incorporation provides that the Corporation is
authorized to issue 20,000,000 shares of preferred stock, none of which are
outstanding, now therefore it is.
RESOLVED, that pursuant to the authority vested in the Board of Directors
of the Corporation by Article FOURTH of the Certificate of Incorporation, a
series of Preferred Stock of the Corporation be, and it hereby is, created out
of the authorized but unissued shares of the capital stock of the Corporation,
such series to be designated Series A Junior Participating Preferred Stock (the
"Participating Preferred Stock"), to consist of four hundred thousand (400,000)
shares, par value $.01 per share, of which the preferences and relative and
other rights, and the qualifications, limitations or restrictions thereof, shall
be as follows:
1. Future Increase or Decrease.
Subject of paragraph 4(e) of this resolution, the number of shares of said
series may at any time or from time to time be increased or decreased by the
Board of Directors notwithstanding that shares of such series may be outstanding
at such time of increase or decrease.
2. Dividend Rate.
(a) The holders of shares of Participating Preferred Stock shall be
entitled to receive, when, as and if declared by the Board of Directors out of
funds legally available for the purpose, quarterly dividends payable in cash on
the first day of each November, February, May and August in each year (each such
date being referred to herein as a "Quarterly Dividend Payment Date"),
commencing on the first Quarterly Dividend Payment Date after the first issuance
of a share or fraction of a share of Participating Preferred Stock, in an amount
per share (rounded to the nearest cent) equal to the greater of (a) $10.00 or
(b) 1,000 times the aggregate per share amount of all cash dividends and 1,000
times the aggregate per share amount (payable in kind) of all non-cash dividends
or other distributions other than a dividend payable in shares of Common Stock
or a subdivision of the outstanding shares of Common Stock (by reclassification
or otherwise), declared on the Common Stock, par value $.01 per share, of the
Corporation (the "Common Stock") since the immediately preceding Quarterly
Dividend Payment Date, or, with respect to the first Quarterly Dividend Payment
Date, since the first issuance of any share or fraction of a share of
Participating Preferred Stock.
(b) On or after the first issuance of any share or fractional share of
Participating Preferred Stock, no dividend on Common Stock shall be declared
unless concurrently therewith a dividend or distribution is declared on the
Participating Preferred Stock as provided in paragraph (a) above; and the
declaration of any such dividend on the Common Stock shall be expressly
conditioned upon payment or declaration of and provision for a dividend on the
Participating Preferred Stock as above provided. In the event no dividend or
distribution shall have been declared on the Common Stock during the period
between any Quarterly Dividend Payment Date and the next subsequent Quarterly
Dividend Payment Date, a dividend of $10.00 per share on the Participating
Preferred Stock shall nevertheless be payable on such subsequent Quarterly
Dividend Payment Date.
(c) Dividends shall begin to accrue and be cumulative on outstanding shares
of Participating Preferred Stock from the Quarterly Dividend Payment Date next
preceding the date of issue of such shares of Participating Preferred Stock,
unless the date of issue of such shares is prior to the record date for the
first Quarterly Dividend Payment Date, in which case dividends on such shares
shall begin to accrue from the date of issue of such shares, or unless the date
of issue is a Quarterly Dividend Payment Date or is a date after the record date
for the determination of holders of shares of Participating Preferred Stock
entitled to receive a quarterly dividend and before such Quarterly Dividend
Payment Date, in either of which events such dividends shall begin to accrue and
be cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. The Board of Directors may fix a record date
for the determination of holders of shares of Participating Preferred Stock
entitled to receive payment of a dividend distribution declared thereon, which
record date shall be no more than 30 days prior to the date fixed for the
payment thereof.
3. Dissolution, Liquidation and Winding Up.
In the event of any voluntary or involuntary dissolution, liquidation or
winding up of the affairs of the Corporation (hereinafter referred to as a
"Liquidation"), the holders of Participating Preferred Stock shall receive at
least $100.00 per share, plus an amount equal to accrued and unpaid dividends
and distributions thereon, whether or not declared, to the date of such payment,
provided that the holders of shares of Participating Preferred Stock shall be
entitled to receive at least an aggregate amount per share equal to 1,000 times
the aggregate amount to be distributed per share to holders of Common Stock (the
"Participating Preferred Liquidation Preference").
4. Voting Rights.
The holders of shares of Participating Preferred Stock shall have the
following voting rights:
(a) Each share of Participating Preferred Stock shall entitle the holder
thereof to one thousand (1,000) votes on all matters submitted to a vote of the
stockholders of the Corporation.
(b) Except as otherwise provided herein, or by law, the Certificate of
Incorporation or the Amended and Restated By-laws of the Corporation (the
"By-laws"), the holders of shares of Participating Preferred Stock and the
holders of shares of Common Stock shall vote together as one class on all
matters submitted to a vote of stockholders of the Corporation.
(c) If and whenever dividends on the Participating Preferred Stock shall be
in arrears in an amount equal to six quarterly dividend payments, then and in
such event the holders of the Participating Preferred Stock, voting separately
as a class (subject to the provisions of subparagraph (d) below), shall be
entitled at the next annual meeting of the stockholders or at any special
meeting to elect two (2) directors. Each share of Participating Preferred Stock
shall be entitled to one vote, and holders of fractional shares shall have the
right to a fractional vote. Upon election, such directors shall become
additional directors of the Corporation and the authorized number of directors
of the Corporation shall thereupon be automatically increased by such number of
directors. Such right of the holders of Participating Preferred Stock to elect
directors may be exercised until all dividends in default on the Participating
Preferred Stock shall have been paid in full, and dividends for the current
dividend period declared and funds therefor set apart, and when so paid and set
apart, the right of the holders of Participating Preferred Stock to elect such
number of directors shall cease, the term of such directors shall thereupon
terminate, and the authorized number of directors of the Corporation shall
thereupon return to the number of authorized directors otherwise in effect, but
subject always to the same provisions for the vesting of such special voting
rights in the case of any such future dividend default or defaults. The fact
that dividends have been paid and set apart as required by the preceding
sentence shall be evidenced by a certificate executed by the President and the
chief financial officer of the Corporation and delivered to the Board of
Directors. The directors so elected by holders of Participating Preferred Stock
shall serve until the certificate described in the preceding sentence shall have
been delivered to the Board of Directors or until their respective successors
shall be elected or appointed and qualify.
At any time when such special voting rights have been so vested in the
holders of the Participating Preferred Stock, the Secretary of the Corporation
may, and upon the written request of the holders of record of 10% or more of the
number of shares of the Participating Preferred Stock then outstanding addressed
to such Secretary at the principal office of the Corporation in the State of
Illinois, shall, call a special meeting of the holders of the Participating
Preferred Stock for the election of the directors to be elected by them as
hereinabove provided, to be held in the case of such written request within
forty (40) days after delivery of such request, and in either case to be held at
the place and upon the notice provided by law and in the By-laws of the
Corporation for the holding of meetings of stockholders; provided, however, that
the Secretary shall not be required to call such a special meeting (i) if any
such request is received less than ninety (90) days before the date fixed for
the next ensuing annual or special meeting of stockholders or (ii) if at the
time any such request is received, the holders of Participating Preferred Stock
are not entitled to elect such directors by reason of the occurrence of an event
specified in the third sentence of subparagraph (d) below.
(d) if, at any time when the holders of Participating Preferred Stock are
entitled to elect directors pursuant to the foregoing provisions of this
paragraph 4, the holders of any one or more additional series of Preferred Stock
are entitled to elect directors by reason of any default or event specified in
the Certificate of Incorporation, as in effect at the time of the certificate of
designation for such series, and if the terms for such other additional series
so permit, the voting rights of the two or more series then entitled to vote
shall be combined (with each series having a number of votes proportional to the
aggregate liquidation preference of its outstanding shares). In such case, the
holders of Participating Preferred Stock and of all such other series then
entitled so to vote, voting as a class, shall elect such directors. If the
holders of any such other series have elected such directors prior to the
happening of the default or event permitting the holders of Participating
Preferred Stock to elect directors, or prior to a written request for the
holding of a special meeting being received by the Secretary of the Corporation
from the holders of not less than 10% of the then outstanding shares of
Participating Preferred Stock, then such directors so previously elected will be
deemed to have been elected by and on behalf of the holders of Participating
Preferred Stock as well as such other series, without prejudice to the right of
the holders of Participating Preferred Stock to vote for directors if such
previously elected directors shall resign, cease to serve or fail to stand for
reelection while the holders of Participating Preferred Stock are entitled to
vote. If the holders of any such other series are entitled to elect in excess of
two (2) directors, the Participating Preferred Stock shall not participate in
the election of more than two (2) such directors, and those directors whose
terms first expire shall be deemed to be the directors elected by the holders of
Participating Preferred Stock; provided that, if at the expiration of such terms
the holders of Participating Preferred Stock are entitled to vote in the
election of directors pursuant to the provisions of this paragraph 4, then the
Secretary of the Corporation shall call a meeting (which meeting may be the
annual meeting or special meeting of stockholders referred to in
subparagraph (c)) of holders of Participating Preferred Stock for the purpose of
electing replacement directors (in accordance with the provisions of this
paragraph 4) to be held on or prior to the time of expiration of the expiring
terms referred to above.
(e) Except as otherwise set forth herein or required by law, the
Certificate of Incorporation or the By-laws, holders of Participating Preferred
Stock shall have no special voting rights and their consent shall not be
required (except to the extent they are entitled to vote with holders of Common
Stock as set forth herein) for the taking of any corporate action. No consent of
the holders of outstanding shares of Participating Preferred Stock at any time
outstanding shall be required in order to permit the Board of Directors to:
(i) increase the number of authorized shares of Participating Preferred Stock or
to decrease such number to a number not below the sum of the number of shares of
Participating Preferred Stock then outstanding and the number of shares with
respect to which there are outstanding rights to purchase; or (ii) to issue
Preferred Stock which is senior to the Participating Preferred Stock, junior to
the Participating Preferred Stock or on a parity with the Participating
Preferred Stock.
5. Redemption.
The shares of Participating Preferred Stock shall not be redeemable.
6. Conversion Rights.
The Participating Preferred Stock is not convertible into Common Stock or
any other security of the Corporation.
IN WITNESS WHEREOF, the undersigned Senior Vice President, General Counsel
and Secretary of the Corporation declares under penalty or perjury the truth, to
the best of his knowledge, of this Certificate of Designation, Preferences and
Rights of Series A Junior Participating Preferred Stock.
Executed this 25th day of July, 1997 in Melville, New York
By: /s/ Stephen B. Paige
Stephen B. Paige,
Senior Vice President,
General Counsel and Secretary