Exhibit 3(A)
RESTATED CERTIFICATE OF INCORPORATION
OF
McDONALD'S CORPORATION
(originally incorporated on December 21, 1964
under the name "Regrub, Inc.")
FIRST: The name of the corporation is McDONALD'S
CORPORATION.
SECOND: Its registered office in the State of Delaware is
located at 32 Loockerman Square, Suite L-100, in the City of Dover,
County of Kent.
The name and address of its registered agent is The
Prentice-Hall Corporation System, Inc., 32 Loockerman Square, Suite L-
100, Dover, Delaware 19901.
THIRD: The nature of the business of the Corporation and
the objects and purposes to be transacted, promoted or carried on are
as follows:
1. To obtain by license or otherwise and to grant to
others by license or otherwise the right to the use of drive-in food
establishment systems and food service systems of every kind and
character, and to manage and operate drive-in and other restaurants
and eating places of all kinds.
2. To manufacture, construct, lease, purchase and
otherwise acquire; to hold, own, repair, maintain, operate and invest,
trade and deal in; to lien, mortgage, pledge and otherwise encumber,
and to let, assign, transfer, sell and otherwise dispose of goods,
wares and merchandise and personal property of every kind and
description and wherever situated.
3. To the same extent as natural persons might or could
do, to purchase or otherwise acquire, hold, own, maintain, work,
develop, sell, lease, sublease, exchange, hire, convey, mortgage or
otherwise dispose of and turn to account and deal in, lands,
leaseholds, any interests, estates and rights in real property, any
personal or mixed property, and franchises, rights, licenses, permits
or privileges of every character.
4. To acquire by purchase, exchange or otherwise, all, or
any part of, or any interest in, the properties, assets, business and
good will of any one or more persons, firms, associations,
corporations or syndicates engaged in any business which the
Corporation is authorized to engage in; to pay for the same in cash,
property or its own or other securities; to hold, operate, reorganize,
liquidate, sell or in any manner dispose of the whole or any part
thereof; and in connection therewith, to assume or guarantee
performance of any liabilities, obligations or contracts of such
persons, firms, associations, corporations or syndicates, and to
conduct in any lawful manner the whole or any part of any business
thus acquired.
5. To acquire by purchase, subscription, contract or
otherwise, and to hold for investment or otherwise, sell, exchange,
mortgage, pledge or otherwise dispose of, or turn to account or
realize upon, and generally to deal in and with, any and all kinds of
securities issued or created by, or interests in, corporations,
associations, partnerships, firms, trustees, syndicates, individuals,
municipalities or other political or governmental divisions or
subdivisions, or any thereof, or by any combinations, organizations or
entities whatsoever, irrespective of their form or the name by which
they may be described; and to exercise any and all rights, powers, and
privileges of individual ownership or interest in respect of any and
all such securities and interests, including the right to vote thereon
and to consent and otherwise act with respect thereto; to do any and
all acts and things for the preservation, protection, improvement and
enhancement in value of any and all such securities or interests, and
to aid by loan, subsidy, guaranty or in any other manner permitted by
law those issuing, creating, or responsible for any such securities or
interests.
6. To develop, apply for, obtain, register, purchase,
lease, take licenses in respect of or otherwise acquire, and to hold,
own, use, operate, enjoy, turn to account, grant licenses in respect
of, manufacture under, introduce, sell, assign, mortgage, pledge or
otherwise dispose of any and all inventions, devices, formulae,
processes, improvements and modifications thereof, letters patent and
all rights connected therewith or appertaining thereunto, copyrights,
trademarks, trade names, trade symbols and other indications of origin
and ownership, franchises, licenses, grants and concessions granted by
or recognized under the laws of the United States of America or of any
state or subdivision thereof or of any other country or subdivision
thereof.
7. To loan money upon the security of real and/or personal
property of whatsoever name, nature or description, or without
security.
8. To borrow money for any of the purposes of the
Corporation, from time to time, and without limit as to amount; to
issue and sell its own securities in such amounts, on such terms and
conditions, for such purposes and for such prices, as the Board of
Directors shall determine; and to secure such securities, by mortgage
upon, or the pledge of, or the conveyance or assignment in trust of,
the whole or any part of the properties, assets, business and good
will of the Corporation, then owned or thereafter acquired.
It is the intention that the objects and purposes set forth
in the foregoing clauses of this Article Third shall not, unless
otherwise specified herein, be in any wise limited or restricted by
reference to, or inference from, the terms of any other clause of this
or any other article in this Certificate, but that the objects and
purposes specified in each of said clauses shall be regarded as
independent objects and purposes.
It is also the intention that the foregoing clauses shall be
construed as powers as well as objects and purposes; that the
Corporation shall be authorized to conduct its business or hold
property in any part of the United States and its possessions, and
foreign countries; that the foregoing enumeration of specific powers
shall not be held to limit or restrict in any manner the general
powers of the Corporation; and that generally the Corporation shall be
authorized to exercise and enjoy all other powers conferred on
corporations by the laws of Delaware.
FOURTH: The total number of shares of stock which the
Corporation shall have authority to issue is One Billion Four Hundred
Fifteen Million (1,415,000,000), consisting of One Billion Two Hundred
Fifty Million (1,250,000,000) shares of Common Stock without par value
and One Hundred Sixty-Five Million (165,000,000) shares of Preferred
Stock without par value.
A. COMMON STOCK
Each share of Common Stock shall be equal to every other
share of Common Stock in every respect. Subject to any exclusive
voting rights which may vest in holders of Preferred Stock under the
provisions of any series of the Preferred Stock established by the
Board of Directors pursuant to authority herein provided, the shares
of Common Stock shall entitle the holders thereof to one vote for each
share upon all matters upon which stockholders have the right to vote.
B. PREFERRED STOCK
(1) Preferred Stock may be issued from time to time in one
or more series, each of such series to have such designations,
preferences and relative, participating, optional or other special
rights, and qualifications, limitations or restrictions thereof, as
are stated and expressed in this Article and in the resolution or
resolutions providing for the issuance of such series adopted by the
Board of Directors as hereinafter provided.
(2) Authority is hereby expressly granted to the Board of
Directors subject to the provisions of this Article to authorize the
issuance of one or more series of Preferred Stock and, with respect to
each series, to fix by resolution or resolutions providing for the
issuance of such series:
(a) The number of shares to constitute such series and
the distinctive designations thereof;
(b) The dividend rate or rates to which such shares
shall be entitled and the restrictions, limitations and conditions
upon the payment of such dividends, whether dividends shall be
cumulative or non-cumulative and, if cumulative, the date or dates
from which dividends shall accumulate, the dates on which dividends,
if declared, shall be payable, and the preferences or relations to the
dividends payable on any other series of Preferred Stock;
(c) Whether or not all or any part of the shares of
such series shall be redeemable, and if so, the limitations and
restrictions with respect to such redemptions, the manner of selecting
shares of such series for redemption if less than all shares are to be
redeemed, and the amount, if any, in addition to any accrued dividends
thereon, which the holder of shares of such series shall be entitled
to receive upon the redemption thereof, which amount may vary at
different redemption dates and may be different with respect to shares
redeemed through the operation of any retirement or sinking fund and
with respect to shares otherwise redeemed;
(d) The amount in addition to any accrued dividends
thereon which the holders of shares of such series shall be entitled
to receive upon the voluntary or involuntary liquidation, dissolution
or winding up of the Corporation, which amount may vary depending on
whether such liquidation, dissolution or winding up is voluntary or
involuntary and, if voluntary, may vary at different dates;
(e) Whether or not the shares of such series shall be
subject to the operation of a purchase, retirement or sinking fund,
and, if so, whether such purchase, retirement or sinking fund shall be
cumulative or non-cumulative, the extent and the manner in which such
fund shall be applied to the purchase or redemption of the shares of
such series for retirement or to other corporate purposes and the
terms and provisions relative to the operation thereof;
(f) Whether or not the shares of such series shall be
convertible into, or exchangeable for, shares of stock of any other
class or classes, or of any other series of the same class, and if so
convertible or exchangeable, the price or prices or the rate or rates
of conversion or exchange and the method, if any, of adjusting the
same;
(g) The voting powers, if any, of such series in
addition to the voting powers provided by law; except that such powers
shall not include the right to have more than one vote per share;
(h) Any other preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof as shall not be inconsistent with law or with
this Article.
Notwithstanding the fixing of the number of shares
constituting a particular series upon the issuance thereof, the Board
of Directors may at any time thereafter authorize the issuance of
additional shares of the same series, or decrease the number of shares
constituting such series (but not below the number of shares of such
series then outstanding).
(3) All shares of any one series of Preferred Stock shall
be identical with all other shares of the same series except that
shares of any one series issued at different times may differ as to
the dates from which dividends thereon shall be cumulative; and all
series shall rank equally and be identical in all respects, except as
permitted by the foregoing provisions of paragraph B. (2).
(4) (a) The holders of Preferred Stock shall be entitled
to receive cash dividends when and as declared by the Board of
Directors at such rate per share per annum, cumulatively if so
provided, and with such preferences, as shall have been fixed by the
Board of Directors, before any dividends shall be paid upon or
declared and set apart for the Common Stock or any other class of
stock ranking junior to the Preferred Stock, and such dividends on
each series of the Preferred Stock shall cumulate, if at all, from and
after the dates fixed by the Board of Directors with respect to such
cumulation. Accrued dividends shall bear no interest.
(b) If dividends on the Preferred Stock are not
declared in full then dividends shall be declared ratably on all
shares of stock of each series of equal preference in proportion to
the respective unpaid cumulative dividends, if any, to the end of the
then current dividend period. No ratable distribution shall be
declared or set apart for payment with respect to any series until
accumulated dividends in arrears in full have been declared and paid
on any series senior in preference.
(c) Unless dividends on all outstanding shares of
series of the Preferred Stock having cumulative dividend rights shall
have been fully paid for all past dividend periods, and unless all
required sinking fund payments, if any, shall have been made or
provided for, no dividend (except a dividend payable in Common Stock
or in any other class of stock ranking junior to the Preferred Stock)
shall be paid upon or declared and set apart for the Common Stock or
any other class of stock ranking junior to the Preferred Stock.
(d) Subject to the foregoing provisions, the Board of
Directors may declare and pay dividends on the Common Stock and on any
class of stock ranking junior to the Preferred Stock, to the extent
permitted by law. After full dividends for the current dividend
period, and, in the case of Preferred Stock having cumulative dividend
rights after all prior dividends have been paid or declared and set
apart for payment, the holders of the Common Stock shall be entitled,
to the exclusion of the holders of the Preferred Stock, to all further
dividends declared and paid in such current dividend period.
(5) In the event of any liquidation, dissolution or winding
up of the Corporation, whether voluntary or involuntary, before any
payment or distribution of the assets of the Corporation shall be made
to or set apart for the holders of shares of any class or classes of
stock of the Corporation ranking junior to the Preferred Stock, the
holders of the shares of each series of the Preferred Stock shall be
entitled to receive payment of the amount per share fixed in the
resolution or resolutions adopted by the Board of Directors providing
for the issuance of the shares of such series, plus an amount equal to
all dividends accrued thereon to the date of final distribution to
such holders; but they shall be entitled to no further payment. If,
upon any liquidation, dissolution or winding up of the Corporation,
the assets of the Corporation, or proceeds thereof, distributable
among the holders of the shares of the Preferred Stock shall be
insufficient to pay in full the preferential amount aforesaid, then
such assets, or the proceeds thereof, shall be distributed among such
holders ratably in accordance with the respective amount which would
be payable on such shares if all amounts payable thereon were paid in
full. For the purposes of this paragraph B. (5), the sale,
conveyance, exchange or transfer (for cash, shares of stock,
securities or other consideration) of all or substantially all of the
property or assets of the Corporation or a consolidation or merger of
the Corporation with one or more corporations shall not be deemed to
be a dissolution, liquidation or winding up, voluntary or involuntary.
(6) Shares of any series of Preferred Stock which have been
issued and reacquired in any manner by the Company (excluding shares
purchased and retired, whether through the operation of a retirement
or sinking fund or otherwise, and shares which, if convertible or
exchangeable, have been converted into or exchanged for shares of
stock of any other class or classes) shall have the status of
authorized and unissued shares of Preferred Stock and may be reissued
as a part of the series of which they were originally a part or may be
reclassified and reissued as part of a new series of Preferred Stock
or as part of any other series of Preferred Stock, all subject to the
conditions or restrictions on issuance fixed by the Board of Directors
with respect to the shares of any other series of Preferred Stock.
(7) Except as otherwise specifically provided herein or in
the authorizing resolutions, none of the shares of any series of
Preferred Stock shall be entitled to any voting rights and the Common
Stock shall have the exclusive right to vote for the election of
directors and for all other purposes. So long as any shares of any
series of Preferred Stock are outstanding, the Corporation shall not,
without the consent of the holders of a majority of the then
outstanding shares of Preferred Stock, irrespective of series, either
expressed in writing (to the extent permitted by law) or by their
affirmative vote at a meeting called for that purpose: (i) adopt any
amendment to this Restated Certificate of Incorporation or take any
other action which in any material respect adversely affects any
preference, power, special right, or other term of the Preferred Stock
or the holders thereof, (ii) create or issue any class of stock
entitled to any preference over the Preferred Stock as to the payment
of dividends, or the distribution of capital assets, (iii) increase
the aggregate number of shares constituting the authorized Preferred
Stock or (iv) create or issue any other class of stock entitled to any
preference on a parity with the Preferred Stock as to the payment of
dividends or the distribution of capital assets.
(8) If in any case the amounts payable with respect to any
obligations to retire shares of the Preferred Stock are not paid in
full in the case of all series with respect to which such obligations
exist, the number of shares of each of such series to be retired
pursuant to any such obligations shall be in proportion to the
respective amounts which would be payable on account of such
obligations if all amounts payable in respect of such series were
discharged in full.
(9) The shares of Preferred Stock may be issued by the
Corporation from time to time for such consideration as may be fixed
from time to time by the Board of Directors. Any and all shares for
which the consideration so fixed shall have been paid or delivered
shall be deemed fully paid and nonassessable.
(10) For the purpose of the provisions of this Article
dealing with Preferred Stock or of any resolution of the Board of
Directors providing for the issuance of any series of Preferred Stock
or of any certificate filed with the Secretary of State of the State
of Delaware pursuant to any such resolution (unless otherwise provided
in any such resolution or certificate):
(a) The term "outstanding", when used in reference to
shares of stock, shall mean issued shares, excluding shares held by
the Corporation and shares called for redemption, funds for the
redemption of which shall have been set aside or deposited in trust;
(b) The amount of dividends "accrued" on any share of
Preferred Stock as at any dividend date shall be deemed to be the
amount of any unpaid dividends accumulated thereon to and including
such dividend date, whether or not earned or declared, and the amount
of dividends "accrued" on any share of Preferred Stock as at any date
other than a dividend date shall be calculated as the amount of any
unpaid dividends accumulated thereon to and including the last
preceding dividend date, whether or not earned or declared, plus an
amount equivalent to interest on the involuntary liquidation value of
such share at the annual dividend rate fixed for the shares of such
series for the period after such last preceding dividend date to and
including the date as of which the calculation is made;
(c) The term "class or classes of stock of the
corporation ranking junior to the Preferred Stock" shall mean the
Common Stock of the Corporation and any other class or classes of
stock of the Corporation hereafter authorized which shall rank junior
to the Preferred Stock as to dividends or upon liquidation.
C. PROVISIONS APPLICABLE TO ALL CAPITAL STOCK
No holder of any share or shares of any class of stock of
the Corporation shall have any preemptive or preferential right to
subscribe for or purchase any shares of stock of any class of the
Corporation now or hereafter authorized or any securities convertible
into or carrying any rights to purchase any shares of stock of any
class of the Corporation now or hereafter authorized, other than such
rights, if any, as the Board of Directors in its discretion from time
to time may grant, and at such prices and upon such other terms and
conditions as the Board of Directors in its discretion may fix.
D. SERIES OF PREFERRED STOCK
Following are the statements of the designations,
preferences and relative, participating, optional or other special
rights, and qualifications, limitations and restrictions thereof, of
the series of Preferred Stock that have been designated by the Board
of Directors as authorized herein:
1. Series A Junior Participating Preferred Stock.
RESOLVED, that pursuant to the authority granted to and
vested in the Board of Directors of this Corporation (hereinafter
called the "Board of Directors" or the "Board") in accordance with the
provisions of the Restated Certificate of Incorporation, the Board of
Directors hereby creates a series of Preferred Stock, without par
value (the "Preferred Stock"), of the Corporation and hereby states
the designation and number of shares, and fixes the relative rights,
preferences, and limitations thereof as follows:
Series A Junior Participating Preferred Stock:
Section 1. Designation and Amount. The shares of such
series shall be designated as "Series A Junior Participating Preferred
Stock" (the "Series A Preferred Stock") and the number of shares
constituting the Series A Preferred Stock shall be 2,050,000. Such
number of shares may be increased or decreased by resolution of the
Board of Directors; provided, that no decrease shall reduce the number
of shares of Series A Preferred Stock to a number less than the number
of shares then outstanding plus the number of shares reserved for
issuance upon the exercise of outstanding options, rights or warrants
or upon the conversion of any outstanding securities issued by the
Corporation convertible into Series A Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of
any series of Preferred Stock (or any similar stock) ranking prior and
superior to the Series A Preferred Stock with respect to dividends,
the holders of shares of Series A Preferred Stock, in preference to
the holders of Common Stock, without par value (the "Common Stock"),
of the Corporation, and of any other junior 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 March, June, September and December 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 Series A Preferred Stock, in an amount per share (rounded to
the nearest cent) equal to the greater of (a) $1 or (b) subject to the
provision for adjustment hereinafter set forth, 100 times the
aggregate per share amount of all cash dividends, and 100 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
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 Series A
Preferred Stock. In the event the Corporation shall at any time
declare or pay any dividend on the Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock)
into a greater or lesser number of shares of Common Stock, then in
each such case the amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event under
clause (b) of the preceding sentence shall be adjusted by multiplying
such amount by a fraction, the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or
distribution on the Series A Preferred Stock as provided in paragraph
(A) of this Section immediately after it declares a dividend or
distribution on the Common Stock (other than a dividend payable in
shares of Common Stock); provided that, 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 $1 per share
on the Series A 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 Series A Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such shares,
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 Series A 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. Dividends paid on the
shares of Series A Preferred Stock in an amount less than the total
amount of such dividends at the time accrued and payable on such
shares shall be allocated pro rata on a share-by-share basis among all
such shares at the time outstanding. The Board of Directors may fix a
record date for the determination of holders of shares of Series A
Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be not more
than 60 days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series
A Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth, each share of Series A Preferred Stock shall entitle the holder
thereof to one vote on all matters submitted to a vote of the
stockholders of the Corporation. In the event the Corporation shall
at any time declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by
reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common
Stock, then in each such case the number of votes per share to which
holders of Series A Preferred Stock were entitled immediately prior to
such event shall be adjusted by multiplying such number by a fraction,
the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which
is the number of shares of Common Stock that were outstanding
immediately prior to such event, provided that in no event shall a
share of Series A Preferred Stock be entitled to more than one vote.
(B) Except as otherwise provided herein, in any other
Certificate of Designations creating a series of Preferred Stock or
any similar stock, or by law, the holders of shares of Series A
Preferred Stock and the holders of shares of Common Stock and any
other capital stock of the Corporation having general voting rights
shall vote together as one class on all matters submitted to a vote of
stockholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by
law, holders of Series A 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 taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared, on shares of
Series A Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity (either as
to dividends or upon liquidation, dissolution or winding up) with the
Series A Preferred Stock, except dividends paid ratably on the Series
A Preferred Stock and all such parity stock on which dividends are
payable or in arrears in proportion to the total amounts to which the
holders of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock, provided that the Corporation may at any
time redeem, purchase or otherwise acquire shares of any such junior
stock in exchange for shares of any stock of the Corporation ranking
junior (either as to dividends or upon dissolution, liquidation or
winding up) to the Series A Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock, or any shares of
stock ranking on a parity with the Series A Preferred Stock, except in
accordance with a purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of such shares
upon such terms as the Board of Directors, after consideration of the
respective annual dividend rates and other relative rights and
preferences of the respective series and classes, shall determine in
good faith will result in fair and equitable treatment among the
respective series or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any
shares of stock of the Corporation unless the Corporation could, under
paragraph (A) of this Section 4, purchase or otherwise acquire such
shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A
Preferred Stock purchased or otherwise acquired by the Corporation in
any manner whatsoever shall be retired and cancelled promptly after
the acquisition thereof. All such shares shall upon their
cancellation become authorized but unissued shares of Preferred Stock
and may be reissued as part of a new series of Preferred Stock subject
to the conditions and restrictions on issuance set forth herein, in
the Restated Certificate of Incorporation, or in any other Certificate
of Designations creating a series of Preferred Stock or any similar
stock or as otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up. Upon
any liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (1) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series A Preferred Stock unless,
prior thereto, the holders of shares of Series A Preferred Stock shall
have received $100 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
Series A Preferred Stock shall be entitled to receive an aggregate
amount per share, subject to the provision for adjustment hereinafter
set forth, equal to 100 times the aggregate amount to be distributed
per share to holders of shares of Common Stock, or (2) to the holders
of shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Preferred
Stock, except distributions made ratably on the Series A Preferred
Stock and all such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. In the event the Corporation
shall at any time declare or pay any dividend on the Common Stock
payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common Stock
(by reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of shares of
Common Stock, then in each such case the aggregate amount to which
holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under the proviso in clause (1) of the
preceding sentence shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the
Corporation shall enter into any consolidation, merger, combination or
other transaction in which the shares of Common stock are exchanged
for or changed into other stock or securities, cash and/or any other
property, then in any such case each share of Series A Preferred Stock
shall at the same time be similarly exchanged or changed into an
amount per share, subject to the provision for adjustment hereinafter
set forth, equal to 100 times the aggregate amount of stock,
securities, cash and/or any other property (payable in kind), as the
case may be, into which or for which each share of Common Stock is
changed or exchanged. In the event the Corporation shall at any time
declare or pay any dividend on the Common Stock payable in shares of
Common Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of Common Stock (by reclassification or
otherwise than by payment of a dividend in shares of Common Stock)
into a greater or lesser number of shares of Common Stock, then in
each such case the amount set forth in the preceding sentence with
respect to the exchange or change of shares of Series A Preferred
Stock shall be adjusted by multiplying such amount by a fraction, the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately
prior to such event.
Section 8. No Redemption. The shares of Series A Preferred
Stock shall not be redeemable.
Section 9. Rank. The Series A Preferred Stock shall rank,
with respect to the payment of dividends and the distribution of
assets, junior to all series of any other class of the Corporation's
Preferred Stock.
Section 10. Amendment. The Restated Certificate of
Incorporation of the Corporation shall not be amended in any manner
which would materially alter or change the powers, preferences or
special rights of the Series A Preferred Stock so as to affect them
adversely without the affirmative vote of the holders of at least two-
thirds of the outstanding shares of Series A Preferred Stock, voting
together as a single class.
2. Series B ESOP Convertible Preferred Stock.
RESOLVED, that pursuant to the authority granted to and
vested in the Board of Directors of this Corporation (hereinafter
called the "Board of Directors" or the "Board"), in accordance with
the provisions of the Restated Certificate of Incorporation, the Board
of Directors hereby creates a series of Preferred Stock, without par
value (the "Preferred Stock"), of the Corporation and hereby states
the designation and number of shares, and fixes the relative rights,
preferences and limitations thereof as follows:
Series B ESOP Convertible Preferred Stock:
Section 1. Designation and Amount; Special Purpose
Restricted Transfer Issue.
(A) The shares of such series shall be designated as
"Series B ESOP Convertible Preferred Stock" (the "Series B Preferred
Stock") and the number of shares constituting the Series B Preferred
Stock shall be 5,413,434. Such number may be increased or decreased
by resolution of the Board of Directors; provided, that no decrease
shall reduce the number of shares of Series B Preferred Stock to a
number less than the number of shares then outstanding plus the number
of shares reserved for issuance upon the exercise of outstanding
options, rights or warrants issued by, or upon the conversion of any
outstanding securities issued by, the Corporation convertible into
Series B Preferred Stock.
(B) Shares of Series B Preferred Stock shall be issued
(whether upon original issuance or upon transfer) only to a trustee or
trustees (or to any successor trustee or trustees) (collectively, a
"Trustee") acting under a trust agreement for the benefit of
participants in one or more employee stock ownership plans or other
employee benefit plans of the Corporation or of any subsidiary of the
Corporation (any such plan, a "Plan"). In the event of a sale,
distribution or other transfer (any such sale, distribution or other
transfer, a "Transfer") of any shares of Series B Preferred Stock to
any person or entity other than the Corporation or a Trustee, but
excluding a distribution of such shares to participants or
beneficiaries in a Plan pursuant to the terms thereof, the shares of
Series B Preferred Stock which are the subject of a Transfer (the
"Transferred Shares") shall be automatically converted into shares of
the Corporation's Common Stock, without par value ("Common Stock") at
the conversion rate provided in Section 5(A) hereof; provided,
however, that in the event of a foreclosure or other realization upon
shares of Series B Preferred Stock pledged as collateral by or
pursuant to any credit agreement, indenture or other document or
instrument for the financing or refinancing of the initial purchase of
the Series B Preferred Stock by a Plan, the Transferred Shares shall
be automatically converted into shares of Common Stock at the
conversion rate provided in Section 5(B) hereof. In the event of a
Transfer of any shares of Series B Preferred Stock to any person or
entity other than the Corporation or a Trustee in connection with a
distribution of such shares to participants or beneficiaries in a Plan
pursuant to the terms thereof, the Transferred Shares shall
automatically be converted into Common Stock at the conversion rate
provided in Section 5(B) hereof. In each such case conversion will
occur immediately upon such Transfer and without any further action by
the Corporation or the holder of the Transferred Shares and thereafter
(i) any certificates for Transferred Shares shall be deemed to
represent the shares of Common Stock into which such Transferred
Shares have been so converted, (ii) no holder of such Transferred
Shares shall have any of the voting powers, preferences and relative,
participating, optional or special rights of a holder of shares of
Series B Preferred Stock, but, rather, only the powers and rights of a
holder of the Common Stock into which such shares of Series B
Preferred Stock shall be so converted and (iii) the holder of such
Transferred Shares shall be treated for all purposes as the holder of
the shares of Common Stock into which such shares of Series B
Preferred Stock have been automatically converted as of the date of
such Transfer. The pledge of Series B Preferred Stock as collateral
by or pursuant to any credit agreement, indenture or other document or
instrument for the financing or refinancing of the initial purchase of
the Series B Preferred Stock by a Plan shall not constitute a Transfer
for purposes of this Section 1(B), but the foreclosure or other
realization upon such pledged shares shall constitute a Transfer.
Certificates representing shares of Series B Preferred Stock shall be
legended to reflect the restrictions on transfer set forth in this
Section 1(B). Notwithstanding the foregoing provisions of this
Section 1(B), shares of Series B Preferred Stock (i) may be converted
into shares of Common Stock pursuant to Section 5 or 6 hereof at any
time prior to a Transfer and the shares of Common Stock issued upon
such conversion will not be subject to any of the restrictions of this
Section 1(B) and (ii) shall be redeemable by the Corporation upon the
terms and conditions provided by Sections 7 and 8 hereof.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of
any series of Preferred Stock (or any similar stock) ranking prior and
superior to the Series B Preferred Stock with respect to dividends,
the holders of shares of Series B Preferred Stock, in preference to
the holders of Common Stock and of any other Junior Stock (as defined
in Section 2(D) hereof), shall be entitled to receive, when, as and if
declared by the Board of Directors, out of funds legally available for
the purpose, cumulative cash dividends payable in an amount per share
equal to $.2515 per quarter and no more (such amount being referred to
herein as the "Dividend Amount"), payable in arrears on the first day
of March, June, September and December in each year (each such date
being referred to herein as "Dividend Payment Date"), commencing on
the first Dividend Payment Date after the first issuance of a share of
Series B Preferred Stock. In the event that any Dividend Payment Date
shall occur on any day other than a "Business Day" (as defined in
Section 9(F) hereof), the dividend payment due on such Dividend
Payment Date shall be paid on the Business Day immediately preceding
such Dividend Payment Date. The Board of Directors may fix a record
date for the determination of holders of shares of Series B Preferred
Stock entitled to receive payment of a dividend or distribution
declared thereon, which record date shall be not more than 60 days
prior to the date fixed for the payment thereof.
(B) Dividends shall begin to accrue on outstanding shares
of Series B Preferred Stock from the date of issue of such shares and
shall accrue on a daily basis whether or not declared and whether or
not the Corporation shall have earnings or surplus out of which such
dividends could be paid at the time. Dividends accrued on the shares
of Series B Preferred Stock for any period less than a full quarterly
period between Dividend Payment Dates shall be computed on the basis
of a 360-day year of 30-day months. Accrued but unpaid dividends shall
cumulate as of the Dividend Payment Date on which they first become
payable, but no interest shall accrue on accrued or accumulated but
unpaid dividends.
(C) Dividends paid on the shares of Series B Preferred
Stock in an amount less than the total amount of such dividends at the
time accrued and payable on such shares shall be allocated pro rata on
a share-by-share basis among all such shares at the time outstanding.
(D) So long as any Series B Preferred Stock shall be
outstanding, no dividend shall be declared and paid or set apart for
payment on any other series of stock ranking on a parity with the
Series B Preferred Stock as to dividends ("Parity Stock"), unless
there shall also be or have been declared and paid or set apart for
payment on the Series B Preferred Stock dividends for all dividend
payment periods of the Series B Preferred Stock ending on or before
the dividend payment date of such Parity Stock, ratably in proportion
to the respective amounts of dividends on the Series B Preferred Stock
accumulated and unpaid through the most recent such dividend payment
period, and accumulated and unpaid on such Parity Stock through the
dividend payment period on such Parity Stock ending on such dividend
payment date or such dividend payment date immediately preceding such
dividend payment period. So long as any Series B Preferred Stock shall
be outstanding, in the event that full cumulative dividends on the
Series B Preferred Stock have not been declared and paid or set apart
for payment when due, the Corporation shall not declare and pay or set
apart for payment any dividends or make any other distributions on, or
make any payment on account of the purchase, redemption or other
retirement of, Common Stock or any other class of stock or series
thereof of the Corporation ranking, as to dividends or as to
distributions in the event of a liquidation, dissolution or winding up
of the Corporation, junior to the Series B Preferred Stock
(collectively, "Junior Stock") until full cumulative and unpaid
dividends on the Series B Preferred Stock shall have been paid or
declared and set apart for payment; provided, however, that the
foregoing shall not apply to (i) any dividend payable solely in any
shares of any Junior Stock, or (ii) the acquisition of shares of any
Junior Stock either (x) pursuant to any employee or director incentive
or benefit plan or arrangement of the Corporation or any subsidiary of
the Corporation heretofore or hereafter adopted or (y) in exchange
solely for shares of any other Junior Stock. Subject to the foregoing
provisions of this Section 2(D), the Board of Directors may declare
and the Corporation may pay or set apart for payment dividends and
other distributions on any other Junior Stock or Parity Stock, and may
purchase or otherwise redeem or retire any of the Junior Stock or
Parity Stock or any warrants, rights, or options or other securities
exercisable for or convertible into any of the Junior Stock or Parity
Stock and the holders of shares of the Series B Preferred Stock shall
not be entitled to share therein.
Section 3. Voting Rights. The holders of shares of Series
B Preferred Stock shall have the following voting rights:
(A) Each share of Series B Preferred Stock shall entitle
the holder thereof to one vote on all matters submitted to a vote of
the stockholders of the Corporation; it being understood that whenever
the "Conversion Ratio" (as defined in Section 5(A) hereof) is adjusted
as provided in Section 9 hereof, the number of votes per share of
Series B Preferred Stock shall also be similarly adjusted.
Notwithstanding the foregoing, the number of votes per share of Series
B Preferred Stock shall at no time exceed the highest number then
permitted by the Restated Certificate of Incorporation of the
Corporation as then in effect or by applicable rules and regulations
of the Securities and Exchange Commission or the New York Stock
Exchange. In the event that the number of votes per share of Series B
Preferred Stock is not adjusted upon an adjustment to the Conversion
Ratio as a result of the immediately preceding sentence, then the
Board of Directors shall promptly take such action as may be necessary
to equitably adjust for such adjustment to the Conversion Ratio,
including without limitation, subdividing outstanding shares of Series
B Preferred Stock (by declaring a stock dividend or otherwise) to the
extent the Corporation has authorized shares of Series B Preferred
Stock which are not then outstanding, or designating and issuing
additional shares of Series B Preferred Stock to the extent the
Corporation has authorized shares of Preferred Stock which are not
then outstanding and are undesignated as to series; provided, however,
no such action on the part of the Board of Directors shall adjust or
change the aggregate economic terms assigned to the outstanding shares
of Series B Preferred Shares.
(B) Except as otherwise provided herein, in any other
Certificate of Designations creating a series of Preferred Stock or
any similar stock, or by law, the holders of shares of Series B
Preferred Stock and the holders of shares of Common Stock and any
other capital stock of the Corporation having general voting rights
shall vote together as one class on all matters submitted to a vote of
stockholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by
law, holders of Series B 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 taking any corporate action. Any increase or decrease in
the authorized class of Preferred Stock (but not below the number of
shares thereof then outstanding) shall not be deemed to alter or
change the powers, preferences, or special rights of the shares of
Series B Preferred Stock so as to affect them adversely within the
meaning of the General Corporation Law of the State of Delaware and no
class vote shall be required to authorize such increase or decrease.
(D) If at any time dividends payable on the Series B
Preferred Stock, or on any one or more other series of Preferred Stock
of the Corporation entitled to receive cumulative preferred dividends,
are in arrears and unpaid in an amount equal to or exceeding the
amount of dividends payable on such Series B Preferred Stock and/or
other series of Preferred Stock entitled to receive cumulative
dividends for six quarterly dividend periods, whether or not
consecutive, the holders of all outstanding shares of Preferred Stock
entitled to receive cumulative preferred dividends will have the
exclusive right, voting separately as a class, to elect two directors
to the Board of Directors of the Corporation at the next annual
meeting of stockholders of the Corporation, the authorized number of
Directors not to be increased for this purpose. Such voting right
will continue for such Preferred Stock until all dividends on the
Series B Preferred Stock and on such other series have been paid in
full, at which time such voting right of the holders of such Preferred
Stock will terminate, subject to re-vesting in the event of a
subsequent arrearage. Upon any termination of the aforesaid voting
right, the term of office of those directors elected by holders of
Preferred Stock voting separately as a class will terminate.
Section 4. Liquidation, Dissolution.
(A) Upon any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (i) to the holders of
shares of stock ranking junior with respect to rights to receive
distributions upon liquidation, dissolution or winding up to the
Series B Preferred Stock unless, prior thereto, the holders of shares
of Series B Preferred Stock shall have received an amount in cash of
$14.375 per share (such amount being referred to herein as the
"Liquidation Preference"), plus an amount in cash equal to accrued and
unpaid dividends thereon, whether or not declared, up to the date of
such payment, or (ii) to the holders of shares of stock ranking on a
parity with respect to the right to receive distributions upon
liquidation, dissolution or winding up with the Series B Preferred
Stock, except distributions made ratably on the Series B Preferred
Stock and all such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such
liquidation, dissolution or winding up. After payment of the full
amount to which they are entitled as provided by the foregoing
provisions of this Section 4(A), the holders of shares of Series B
Preferred Stock shall not be entitled to any further right or claim to
any of the remaining assets of the Corporation.
(B) Neither the merger or consolidation of the Corporation
with or into any other corporation or other entity, nor the merger or
consolidation of any other corporation or other entity with or into
the Corporation, nor the sale, transfer or lease of all or any portion
of the assets of the Corporation, shall be deemed to be a liquidation,
dissolution or winding up of the Corporation for purposes of this
Section 4, and the holders of Series B Preferred Stock shall
nevertheless be entitled in the event of any such merger or
consolidation to the rights provided by Section 8 hereof.
(C) Written notice of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation, stating the
payment date or dates when, and the place or places where, the amounts
distributable to holders of Series B Preferred Stock in such
circumstances shall be payable, shall be given by hand delivery, by
courier, by any standard form of telecommunication or by first-class
mail, postage prepaid, delivered, sent or mailed (as the case may be)
not less than twenty (20) days prior to any payment date stated
therein, to the holders of Series B Preferred Stock, at their
respective addresses shown on the books of the Corporation or any
transfer agent for the Series B Preferred Stock; provided, however,
that a failure to give notice as provided above or any defect therein
shall not affect the Corporation's ability to consummate a voluntary
or involuntary liquidation, dissolution or winding up of the
Corporation.
Section 5. Conversion into Common Stock.
(A) A holder of shares of Series B Preferred Stock shall be
entitled, at any time prior to the close of business on the date fixed
for redemption of such shares pursuant to Section 7 hereof, to cause
any or all of such shares to be converted into validly issued, fully
paid and nonassessable shares of Common Stock, initially at a
conversion rate equal to the ratio of .7692 share of Common Stock for
each one share of Series B Preferred Stock, which conversion rate
shall be adjusted as hereinafter provided (and, as so adjusted,
rounded to the nearest ten-thousandth, is hereinafter sometimes
referred to as the "Conversion Ratio"); provided, however, that, if
the shares of Common Stock have a par value, in no event shall the
Conversion Ratio be greater than the Liquidation Preference divided by
the par value of one share of Common Stock.
(B) Notwithstanding Section 5(A), in the event of an
automatic conversion pursuant to Section 1(B) hereof due to a
distribution of Series B Preferred Stock to participants or
beneficiaries in a Plan or foreclosure or other realization upon
shares of Series B Preferred Stock pledged as collateral by or
pursuant to any credit agreement, indenture or other document or
instrument for the financing or refinancing of the initial purchase of
the Series B Preferred Stock by a Plan, shares of Series B Preferred
Stock shall be converted into validly issued, fully paid and
nonassessable shares of Common Stock at a conversion rate, expressed
as a ratio of shares of Common Stock per share of Series B Preferred
Stock, equal to the greatest of: (i) the Conversion Ratio, (ii) a
fraction, the numerator of which shall be the Fair Market Value (as
defined in Section 9(F) hereof) of one share of Series B Preferred
Stock (plus an amount equal to accrued and unpaid dividends thereon,
if such dividends have not already been taken into account in
determining the Fair Market Value) and the denominator of which shall
be the Fair Market Value of one share of Common Stock, both computed
as of the date of conversion, or (iii) the lesser of: (A) one share of
Common Stock per share of Series B Preferred Stock, adjusted
accordingly with adjustments in the Conversion Ratio pursuant to
Section 9 hereof, or (B) a fraction, the numerator of which shall be
the Liquidation Preference plus an amount equal to accrued and unpaid
dividends thereon and the denominator of which shall be the Fair
Market Value of one share of Common Stock on the date of conversion.
(C) Any holder of shares of Series B Preferred Stock
desiring to convert such shares into shares of Common Stock shall
surrender the certificate or certificates representing the shares of
Series B Preferred Stock being converted, duly assigned or endorsed
for transfer to the Corporation (or accompanied by duly executed stock
powers relating thereto), at the principal executive office of the
Corporation or the offices of the transfer agent for the Series B
Preferred Stock or such office or offices in the continental United
States of an agent for conversion as may from time to time be
designated by notice to the holders of the Series B Preferred Stock by
the Corporation or the transfer agent for the Series B Preferred
Stock, accompanied by written notice of conversion. Such notice of
conversion shall specify (i) the number of shares of Series B
Preferred Stock to be converted and the name or names in which such
holder wishes the certificate or certificates for Common Stock to be
issued and for any shares of Series B Preferred Stock not to be so
converted to be issued (subject to compliance with applicable legal
requirements if any of said certificates are to be issued in a name
other than the name of the holder), and (ii) the address to which such
holder wishes delivery to be made of such new certificates to be
issued upon such conversion.
(D) Upon surrender of a certificate representing a share or
shares of Series B Preferred Stock for conversion, the Corporation or
the transfer agent for the Common Stock shall, as promptly as
practicable after such surrender, issue and deliver to the holder
thereof or to such holder's designee, at the address designated by
such holder, a certificate or certificates for the number of shares of
Common Stock to which such holder shall be entitled upon conversion,
together with any cash adjustment of any fraction of a share as
hereinafter provided. In the event that there shall have been
surrendered a certificate or certificates representing shares of
Series B Preferred Stock, only part of which are to be converted, the
Corporation shall issue and deliver to such holder or such holder's
designee a new certificate or certificates representing the number of
shares of Series B Preferred Stock which shall not have been
converted.
(E) A conversion of shares of Series B Preferred Stock into
shares of Common Stock shall be effective (i) if made at the option of
the holder thereof, as of the close of business on the day on which
the Corporation receives written notice of conversion pursuant to
Section 5(C) or (ii) if made pursuant to Section 1(B) hereof, at the
time of Transfer. On and after the effective date of conversion, the
shares of Series B Preferred so converted shall no longer be deemed to
be outstanding for any purpose, and the person or persons entitled to
receive the Common Stock issuable upon such conversion shall be
treated for all purposes as the record holder or holders of such
shares of Common Stock, but no allowance or adjustment shall be made
in respect of dividends payable to holders of Common Stock of record
on any date prior to such effective date. The Corporation shall not
be obligated to pay any dividends which shall have been declared and
shall be payable to holders of shares of Series B Preferred Stock on a
Dividend Payment Date if such Dividend Payment Date for such dividend
shall be on or subsequent to the effective date of conversion of such
shares, unless such declared dividends have been set aside for payment
prior to the effective date of conversion of such shares, which
dividends shall be paid on the applicable Dividend Payment Date.
(F) Whenever the Corporation shall issue shares of Common
Stock upon conversion of shares of Series B Preferred Stock as
contemplated by this Section 5, the Corporation shall issue together
with each such share of Common Stock one right to purchase Series A
Junior Participating Preferred Stock of the Corporation (or other
securities in lieu thereof) pursuant to the Rights Agreement dated as
of December 13, 1988 between the Corporation and The First National
Bank of Chicago, as Rights Agent, as such agreement may from time to
time be amended (such Agreement, as so amended, is hereinafter
referred to as the "Rights Agreement"), or any rights issued to
holders of Common Stock in addition thereto or in replacement
therefor, whether or not such rights shall be exercisable at such
time, but only if such rights are issued and outstanding and held by
other holders of Common Stock at such time and have not expired.
Section 6. Other Conversion Rights. In addition to the
conversion rights provided in Section 5(A) and 5(B) hereof, shares of
Series B Preferred Stock may be converted into shares of Common Stock
at the option of the holder at any time and from time to time upon
notice to the Corporation given not less than five (5) Business Days
prior to the date fixed by the holder in such notice for such
conversion, (A) when and to the extent necessary for such holder to
provide for distributions required to be made under, or to satisfy an
investment election provided to participants in accordance with, a
Plan to participants in such Plan at a conversion rate, expressed as a
ratio of shares of Common Stock per share of Series B Preferred Stock,
equal to the greater of (i) the Conversion Ratio or (ii) a fraction,
the numerator of which shall be the Fair Market Value of one share of
Series B Preferred Stock (plus accrued and unpaid dividends thereon to
the date of conversion if such dividends have not already been taken
into account in determining Fair Market Value) and the denominator of
which shall be the Fair Market Value of one share of Common Stock,
both computed as of the date of conversion, or (B) in the event that
the Plan is determined by the Internal Revenue Service not to be
qualified within the meaning of Sections 401(a) and 4975(e)(7) of the
Internal Revenue Code of 1986, as amended (the "Code") at a conversion
rate, expressed as a ratio of shares of Common Stock per share of
Series B Preferred Stock, equal to the greatest of (i) a fraction, the
numerator of which shall be the Fair Market Value of one share of
Series B Preferred Stock plus an amount equal to accrued and unpaid
dividends thereon (if such dividends have not already been taken into
account in determining the Fair Market Value) and the denominator of
which shall be the Fair Market Value of one share of Common Stock,
both computed as of the date of conversion, (ii) a fraction, the
numerator of which shall be the Liquidation Preference plus accrued
but unpaid dividends thereon to the date of conversion and the
denominator of which shall be the Fair Market Value of one share of
Common Stock on the date of conversion or (iii) the Conversion Ratio.
Section 7. Redemption At the Option of the Corporation.
(A) The Series B Preferred Stock shall be redeemable, in
whole or in part, at the option of the Corporation, out of funds
legally available therefor, at any time after September 8, 1992, at
the following redemption prices:
Redemption Price As
During the Twelve-Month A Percentage of
Period Beginning September 8 Liquidation Preference
---------------------------- ----------------------
1989 107.0
1990 106.3
1991 105.6
1992 104.9
1993 104.2
1994 103.5
1995 102.8
1996 102.1
1997 101.4
1998 100.7
and thereafter at the Liquidation Preference, plus, in each case, an
amount equal to all accrued and unpaid dividends thereon to the date
fixed for redemption. Payment of the redemption price shall be made by
the Corporation in cash or shares of Common Stock, or a combination
thereof, as permitted by Section 7(E). From and after the close of
business on the date fixed for redemption, dividends on shares of
Series B Preferred Stock called for redemption will cease to accrue,
such shares will no longer be deemed to be outstanding and all rights
in respect of such shares of the Corporation shall cease, except the
right to receive the redemption price; provided that shares of Series
B Preferred Stock may be converted pursuant to Section 5 or, if
applicable, Section 6 hereof at any time prior to the close of
business on the date fixed for redemption of such shares pursuant to
Section 7 or 8 hereof. No interest shall accrue on the redemption
price after the date fixed for redemption. If less than all of the
outstanding shares of Series B Preferred Stock are to be redeemed, the
Corporation shall select the shares to be redeemed in the manner
determined by the Board of Directors of the Corporation.
(B) Unless otherwise required by law, notice of redemption
with respect to a redemption pursuant to paragraphs (A), (C) or (D) of
this Section 7 will be sent to the holders of Series B Preferred Stock
at the address shown on the books of the Corporation or any transfer
agent for the Series B Preferred Stock by hand delivery, by courier,
by any standard form of telecommunication or by first class mail,
postage prepaid, delivered, sent or mailed (as the case may be) not
less than twenty (20) days nor more than sixty (60) days prior to the
redemption date. Each such notice shall state: (i) the redemption
date; (ii) the total number of shares of the Series B Preferred Stock
to be redeemed and, if fewer than all the shares held by such holder
are to be redeemed, the number of such shares to be redeemed from such
holder; (iii) the redemption price and method of payment therefor;
(iv) the place or places where certificates for such shares are to be
surrendered for payment of the redemption price; (v) that dividends on
the shares to be redeemed will cease to accrue on such redemption
date; and (vi) the conversion rights of the shares to be redeemed, the
period within which conversion rights may be exercised, and the
Conversion Ratio in effect at the time. Upon surrender of the
certificates for any shares called for redemption pursuant to the
provisions of this Section 7 or the provisions of Section 8 hereof,
which shares have not previously been converted, such shares shall be
redeemed by the Corporation at the date fixed for redemption and at
the applicable redemption price set forth in this Section 7 or in
Section 8 hereof.
(C) In the event (i) of a change in the federal tax law of
the United States of America or a determination by a court of
competent jurisdiction, which, in either case, has the effect of
precluding the Corporation from claiming any of the tax deductions for
dividends paid on the Series B Preferred Stock when such dividends are
used as provided under Section 404(k)(2) of the Internal Revenue Code
of 1986, as amended (the "Code") and in effect on the date shares of
Series B Preferred Stock are initially issued, or (ii) that shares of
Series B Preferred Stock are held by an employee benefit plan intended
to qualify as an employee stock ownership plan within the meaning of
Section 4975 of the Code, as amended, and such plan is determined by
the Internal Revenue Service not to qualify, the Corporation may, in
its sole discretion and notwithstanding anything to the contrary in
Section 7(A), elect to redeem such shares, out of funds legally
available therefor, at a redemption price equal to the greater of (i)
the Liquidation Preference plus an amount equal to accrued and unpaid
dividends or (ii) the Fair Market Value of a share of Series B
Preferred Stock, plus an amount equal to all accrued and unpaid
dividends thereon to the date fixed for redemption if such dividends
have not already been taken into account in determining Fair Market
Value, and otherwise on the terms and conditions set forth in
Sections 7(A) and 7(B).
(D) Notwithstanding anything to the contrary in Section
7(A), the Corporation may elect to redeem any or all of the shares of
Series B Preferred Stock at any time on or prior to September 8, 1992,
out of funds legally available therefor, at a redemption price equal
to the greater of (i) the applicable redemption price specified in
Section 7(A) hereof plus an amount equal to accrued and unpaid
dividends, or (ii) the Fair Market Value of a share of Series B
Preferred Stock, plus an amount equal to all accrued and unpaid
dividends thereon to the date fixed for redemption if such dividends
have not already been taken into account in determining Fair Market
Value, and otherwise on the terms and conditions set forth in Sections
7(A) and 7(B), if the Corporation terminates an employee stock
ownership plan or employee benefit plan pursuant to which shares of
Series B Preferred Stock are then held by a Trustee (in which case
only the shares held pursuant to such plan may be so redeemed).
(E) The Corporation, at its option, may make payment of the
redemption price required upon redemption of shares of Series B
Preferred Stock in cash or in shares of Common Stock, or in a
combination of such shares and cash, any such shares to be valued for
such purpose at their Fair Market Value as of the date of redemption.
Section 8. Consolidation, Combination, Merger, etc.
(A) In the event that the Corporation shall consummate any
exchange offer, liquidation, tender offer, consolidation, merger,
combination, reclassification, recapitalization or other transaction
pursuant to which the outstanding shares of Common Stock are by
operation of law exchanged solely for or changed, reclassified or
converted solely into, stock of any successor or resulting company
(including the Corporation) that constitutes "qualifying employer
securities" with respect to a holder of Series B Preferred Stock
within the meaning of Section 409(a) of the Code and Section 407 (d)
(5) of the Employee Retirement Income Security Act of 1974, as
amended, or any successor provisions of law (together, if applicable,
with a cash payment in lieu of fractional shares), the shares of
Series B Preferred Stock of such holder shall in connection therewith
be assumed by and shall become preferred stock of such successor or
resulting company, having in respect of such company insofar as
possible the same powers, preferences and relative, participating,
optional or other special rights (including the redemption rights
provided by Sections 6, 7 and 8 hereof), and the qualifications,
limitations or restrictions thereon, that the Series B Preferred Stock
had immediately prior to such transaction, except that after such
transaction each share of the Series B Preferred Stock shall be
convertible, otherwise on the terms and conditions provided by Section
5 or 6 hereof, into the number and kind of qualifying employer
securities so receivable by a holder of the number of shares of Common
Stock into which such shares of Series B Preferred Stock could have
been converted pursuant to Section 5(A) hereof immediately prior to
such transaction or, if Section 5(B) or 6 hereof is thereafter
applicable, into the kind of qualifying employer securities so
receivable by a holder of one share of Common Stock and the number of
such shares determined pursuant to Section 5(B) or 6; provided,
however, that if by virtue of the structure of such transaction, a
holder of Common Stock is required to make an election with respect to
the nature and kind of consideration to be received in such transac-
tion, which election cannot practicably be made by the holders of the
Series B Preferred Stock, then such election shall be deemed to be
solely for "qualifying employer securities" (together, if applicable,
with a cash payment in lieu of fractional shares) with the effect
provided above on the basis of the number and kind of qualifying
employer securities receivable by a holder of the number of shares of
Common Stock into which the shares of Series B Preferred Stock could
have been converted pursuant to Section 5(A) hereof immediately prior
to such transaction or if Section 5(B) or 6 hereof is thereafter
applicable, into the kind of qualifying employer securities receivable
by a holder of one share of Common Stock and the number of such shares
determined pursuant to Section 5(B) or 6 (it being understood that if
the kind or amount of qualifying employer securities receivable in
respect of each share of Common Stock upon such transaction is not the
same for each such share, then the kind and amount of qualifying
employer securities deemed to be receivable in respect of each share
of Common Stock for purposes of this proviso shall be the kind and
amount so receivable per share of Common Stock by a plurality of such
shares). The rights of the Series B Preferred Stock as preferred
stock of such successor or resulting company shall successively be
subject to adjustments pursuant to Section 9 hereof after any such
transaction as nearly equivalent as practicable to the adjustments
provided for by such Section prior to such transaction. The
Corporation shall not consummate any such merger, consolidation or
similar transaction unless all then outstanding shares of the Series B
Preferred Stock shall be assumed and authorized by the successor or
resulting company pursuant to this Section 8(A).
(B) In the event that the Corporation shall consummate any
exchange offer, liquidation, tender offer, consolidation, merger,
combination, reclassification, recapitalization or other transaction,
pursuant to which the outstanding shares of Common Stock are by
operation of law exchanged for or changed, reclassified or converted
into other stock or securities or cash or any other property, or any
combination thereof, other than any such consideration which is
constituted solely of qualifying employer securities (as referred to
in Section 8(A)) and cash payments, if applicable, in lieu of
fractional shares, outstanding shares of Series B Preferred Stock
shall, without any action on the part of the Corporation or any holder
thereof (but subject to Section 8(C)), be automatically converted by
virtue of such merger, consolidation, combination or similar business
combination transaction immediately prior to its consummation into the
number of shares of Common Stock into which such shares of Series B
Preferred Stock could have been converted at such time so that each
share of Series B Preferred Stock, shall, by virtue of such
transaction and on the same terms as apply to the holders of Common
Stock, be converted into or exchanged for the aggregate amount of
stock, securities, cash or other property (payable in like kind)
receivable by a holder of the number of shares of Common Stock into
which such shares of Series B Preferred Stock could have been
converted pursuant to Section 5(A) hereof immediately prior to such
transaction; provided, however, that if by virtue of the structure of
such transaction a holder of Common Stock is required to make an
election with respect to the nature and kind of consideration to be
received in such transaction, which election cannot practicably be
made by the holders of the Series B Preferred Stock, then the shares
of Series B Preferred Stock shall, by virtue of such transaction and
on the same terms as apply to the holders of Common Stock, be
converted into or exchanged for the aggregate amount of such stock,
securities, cash or other property (payable in kind) receivable by a
holder of the number of shares of Common Stock into which such shares
of Series B Preferred Stock could have been converted immediately
prior to such transaction if such holder of Common Stock had elected
to receive the maximum amount of qualifying employer securities
offered (it being understood that if the kind or amount of stock,
securities, cash or other property receivable upon such transaction is
not the same for each share which so elected the maximum amount of
qualifying employer securities, then the kind and amount of stock,
securities, cash or other property receivable upon such transaction
for each such share shall be the kind and amount so receivable per
share by a plurality of the shares which so elected the maximum amount
of qualifying employer securities).
(C) In the event the Corporation shall enter into any
agreement providing for any exchange offer, liquidation, tender offer,
consolidation, merger, combination, reclassification, recapitalization
or other transaction, described in Section 8(B), then the Corporation
shall as soon as practicable thereafter (and in any event at least ten
(10) Business Days before consummation of such transaction) give
notice of such agreement and the material terms thereof to each holder
of Series B Preferred Stock and each such holder shall have the right
to elect, by written notice to the Corporation, to receive, upon
consummation of such transaction (if and when such transaction is
consummated), out of funds legally available therefor, from the
Corporation or the successor of the Corporation, in redemption and
retirement of such Series B Preferred Stock, a cash payment equal to
the redemption price specified in Section 7(A) hereof in effect on the
date set for redemption plus an amount equal to all accrued and unpaid
dividends. No such notice of redemption shall be effective unless
given to the Corporation prior to the close of business on the
Business Day prior to consummation of such transaction, unless the
Corporation or the successor of the Corporation shall waive such prior
notice, but any notice of redemption so given prior to such time may
be withdrawn by notice of withdrawal given to the Corporation prior to
the close of business on the Business Day prior to consummation of
such transaction.
Section 9. Anti-Dilution Adjustments.
(A) (i) Subject to the provisions of Sections 9(D) and
9(E) hereof, in the event the Corporation shall, at any time or from
time to time while any of the shares of the Series B Preferred Stock
are outstanding, (x) pay a dividend or make a distribution in respect
of the Common Stock in shares of Common Stock or (y) subdivide the
outstanding shares of Common Stock into a greater number of shares, in
each case whether by reclassification of shares, recapitalization of
the Corporation, a recapitalization or reclassification effected by a
merger, consolidation or other transaction to which Section 8 hereof
applies or otherwise, then, in such event, the Board of Directors
shall, to the extent legally permissible, declare a dividend in
respect of the Series B Preferred Stock in shares of Series B
Preferred Stock (a "Special Dividend") in such a manner that a holder
of Series B Preferred Stock will become the holder of that number of
shares of Series B Preferred Stock equal to the product of the number
of such shares held prior to such event times a fraction (the "Sec.
9(A) Non-Dilutive Share Fraction"), the numerator of which is the
number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common
Stock outstanding immediately before such event. A Special Dividend
declared pursuant to this Section 9(A)(i) shall be effective upon
payment of such dividend or distribution in respect of the Common
Stock and in the case of a subdivision shall become effective
immediately as of the effective date thereof. Concurrently with the
declaration of the Special Dividend pursuant to this paragraph
9(A)(i), the Liquidation Preference and the Dividend Amount of all
shares of Series B Preferred Stock shall be adjusted by dividing the
Liquidation Preference and the Dividend Amount, respectively, in
effect immediately before such event by the Sec. 9(A) Non-Dilutive
Share Fraction.
(ii) The Corporation and the Board of Directors shall
each use its best efforts to take all necessary steps or to take all
actions as are reasonably necessary or appropriate for declaration of
the Special Dividend provided in paragraph 9(A)(i) but shall not be
required to call a special meeting of stockholders in order to
implement the provisions thereof. If for any reason the Board of
Directors is precluded from giving full effect to the Special Dividend
provided in paragraph 9(A)(i), then no such Special Dividend shall be
declared, but instead the Conversion Ratio shall automatically be
adjusted by multiplying the Conversion Ratio in effect immediately
before the event by the Sec. 9(A) Non-Dilutive Share Fraction, and the
Liquidation Preference and the Dividend Amount will not be adjusted.
An adjustment to the Conversion Ratio made pursuant to this paragraph
9(A)(ii) shall be given effect upon payment of such a dividend or
distribution as of the record date for the determination of holders
entitled to receive such dividend or distribution (on a retroactive
basis) and in the case of a subdivision shall become effective
immediately as of the effective date thereof. If subsequently the
Board of Directors is able to give full effect to the Special Dividend
as provided in paragraph 9(A)(i), then such Special Dividend will be
declared in accordance with the provisions of paragraph 9(A)(i) and
the adjustment in the Conversion Ratio as provided in this paragraph 9
(A)(ii) will automatically be reversed and nullified prospectively.
(iii) Subject to the provisions of Sections 9(D) and
9(E) hereof, in the event the Corporation shall, at any time or from
time to time while any of the shares of the Series B Preferred Stock
are outstanding, combine the outstanding shares of Common Stock into a
lesser number of shares, whether by reclassification of shares,
recapitalization of the Corporation, a recapitalization or
reclassification effected by a merger, consolidation or other
transaction to which Section 8 hereof applies or otherwise, then, in
such event, the Conversion Ratio shall automatically be adjusted by
multiplying the Conversion Ratio in effect immediately before such
event by the Sec. 9(A) Non-Dilutive Share Fraction, and the
Liquidation Preference and the Dividend Amount will not be adjusted.
An adjustment to the Conversion Ratio made pursuant to this paragraph
9(A)(iii) shall be given effect immediately as of the effective date
of such combination.
(B) (i) Subject to the provisions of Sections 9(D) and
(E) hereof, in the event the Corporation shall, at any time or from
time to time while any of the shares of Series B Preferred Stock are
outstanding, issue, sell or exchange shares of Common Stock (other
than pursuant to (x) any right or warrant to purchase or acquire
shares of Common Stock (including as such a right or warrant any
security convertible into or exchangeable for shares of Common Stock),
(y) the Rights Agreement or (z) any employee or director incentive,
compensation or benefit plan or arrangement of the Corporation or any
subsidiary of the Corporation heretofore or hereafter adopted) for a
consideration having a Fair Market Value on the date of issuance, sale
or exchange less than the Fair Market Value of such shares on the date
of issuance, sale or exchange, then, in such event, the Board of
Directors shall, to the extent legally permissible, declare a Special
Dividend in such a manner that a holder of Series B Preferred Stock
will become the holder of that number of shares of Series B Preferred
Stock equal to the product of the number of such shares held prior to
such event times a fraction (the "Sec. 9(B)(i) Non-Dilutive Share
Fraction"), the numerator of which is the number of shares of Common
Stock outstanding immediately before the public announcement of such
issuance, sale or exchange plus the number of shares of Common Stock
so issued, sold or exchanged by the Corporation and the denominator of
which is the number of shares of Common Stock outstanding immediately
before the public announcement of such issuance, sale or exchange plus
the number of shares of Common Stock which could be purchased at the
Fair Market Value of the consideration received by the Corporation in
respect of such issuance, sale or exchange. A Special Dividend
declared pursuant to this Section 9(B)(i) shall be effective upon such
issuance, sale or exchange. Concurrently with the declaration of the
Special Dividend pursuant to this Section 9(B)(i), the Liquidation
Preference and the Dividend Amount of all shares of Series B Preferred
Stock shall be adjusted by dividing the Liquidation Preference and the
Dividend Amount, respectively, in effect immediately before such
issuance, sale or exchange by the Sec. 9(B)(i) Non-Dilutive Share
Fraction.
(ii) Subject to the provisions of Sections 9(D) and
9(E) hereof, in the event the Corporation shall, at any time or from
time to time while any shares of Series B Preferred Stock are
outstanding issue, sell or exchange any right or warrant to purchase
or acquire shares of Common Stock (including as such a right or
warrant any security convertible into or exchangeable for shares of
Common Stock and rights issued under the Rights Agreement), other than
any such issuance to holders of shares of Common Stock as a dividend
or distribution (including by way of a reclassification of shares or a
recapitalization of the Corporation) and other than pursuant to any
employee or director incentive, compensation or benefit plan or
arrangement of the Corporation or any subsidiary of the Corporation
heretofore or hereafter adopted, exercisable for a consideration
having a Fair Market Value per share of Common Stock on the date of
such issuance, sale or exchange less than the Sec. 9(F) Non-Dilutive
Amount (as defined in Section 9(F) (vi)), then in such event, the
Board of Directors shall, to the extent legally permissible, declare a
Special Dividend in such a manner that a holder of Series B Preferred
Stock will become the holder of that number of shares of Series B
Preferred Stock equal to the product of the number of such shares held
prior to such event times a fraction (the "Sec. 9 (B)(ii) Non-Dilutive
Share Fraction"), the numerator of which is the number of shares of
Common Stock outstanding immediately before such issuance of rights or
warrants plus the maximum number of shares of Common Stock that could
be acquired upon exercise in full of all such rights and warrants and
the denominator of which is the number of shares of Common Stock
outstanding immediately before such issuance of rights or warrants
plus the number of shares of Common Stock which could be purchased at
the Fair Market Value of a share of Common Stock at the time of such
issuance for the maximum aggregate consideration payable upon exercise
in full of all such rights or warrants and any other amounts paid in
connection with such issuance of rights or warrants. A Special
Dividend declared pursuant to this Section 9(B)(ii) shall be effective
upon such issuance, sale or exchange. Concurrently with the
declaration of the Special Dividend pursuant to this Section 9(B)(ii),
the Liquidation Preference and the Dividend Amount of all shares of
Series B Preferred Stock shall be adjusted by dividing the Liquidation
Preference and the Dividend Amount, respectively, in effect
immediately before such issuance of rights or warrants by the Section
9(B)(ii) Non-Dilutive Share Fraction.
(iii) The Corporation and the Board of Directors shall
each use its best efforts to take all necessary steps or to take all
actions as are reasonably necessary or appropriate for declaration of
the Special Dividend provided in Sections 9(B)(i) and (ii) but shall
not be required to call a special meeting of stockholders in order to
implement the provisions hereof. In the event for any reason the
Board of Directors is precluded from giving full effect to the Special
Dividend provided in Section 9(B)(i) or 9(B)(ii), then no such Special
Dividend shall be declared, but instead the Conversion Ratio shall
automatically be adjusted by multiplying the Conversion Ratio in
effect immediately before such issuance of shares, rights or warrants
by the Sec. 9(B)(i) or 9(B)(ii) Non-Dilutive Share Fraction, as the
case may be, and the Liquidation Preference and Dividend Amount will
not be adjusted. If subsequently the Board of Directors is able to
give full effect to the Special Dividend as provided in Section
9(B)(i) or 9(B)(ii), then such Special Dividend will be declared in
accordance with the provisions of Section 9(B)(i) or 9(B)(ii), as the
case may be, and the adjustment in the Conversion Ratio as provided in
this Section 9(B)(iii) will automatically be reversed and nullified
prospectively.
(C) (i) Subject to the provisions of Sections 9(D) and
9(E) hereof, in the event the Corporation shall, at any time or from
time to time while any of the shares of Series B Preferred Stock are
outstanding, make an Extraordinary Distribution (as hereinafter
defined) in respect of the Common Stock, whether by dividend,
distribution, reclassification of shares or recapitalization of the
Corporation (including a recapitalization or reclassification effected
by a transaction to which Section 8 hereof does not apply) or effect a
Pro Rata Repurchase (as hereinafter defined) of Common Stock, then, in
such event, the Board of Directors shall, to the extent legally
permissible, declare a Special Dividend in such a manner that a holder
of Series B Preferred Stock will become the holder of that number of
shares of Series B Preferred Stock equal to the product of the number
of such shares held prior to such event times a fraction (the "Sec.
9(C) Non-Dilutive Share Fraction"), the numerator of which is the
product of (x) the number of shares of Common Stock outstanding
immediately before such Extraordinary Distribution or Pro Rata
Repurchase minus, in the case of a Pro Rata Repurchase, the number of
shares of Common Stock repurchased by the Corporation multiplied by
(y) the Fair Market Value of a share of Common Stock on the Valuation
Date (as defined in Section 9(F) (viii)) with respect to an
Extraordinary Distribution or on the expiration date (including all
extensions thereof) of any tender offer which is a Pro Rata Repurchase
or on the date of purchase with respect to any Pro Rata Repurchase
which is not a tender offer, as the case may be, and the denominator
of which is (x) the product of (I) the number of shares of Common
Stock outstanding immediately before such Extraordinary Distribution
or Pro Rata Repurchase multiplied by (II) the Fair Market Value of a
share of Common Stock on the Valuation Date with respect to an
Extraordinary Distribution, or on the expiration date (including all
extensions thereof) of any tender offer which is a Pro Rata
Repurchase, or on the date of purchase with respect to any Pro Rata
Repurchase which is not a tender offer, as the case may be, minus (y)
the Fair Market Value of the Extraordinary Distribution or the
aggregate purchase price of the Pro Rata Repurchase, as the case may
be. The Corporation shall send each holder of Series B Preferred
Stock (x) notice of its intent to make any Extraordinary Distribution
and (y) notice of any offer by the Corporation to make a Pro Rata
Repurchase, in each case at the same time as, or as soon as
practicable after, such offer is first communicated to holders of
Common Stock or the record date for such dividend is announced in
accordance with the rules of any stock exchange on which the Common
Stock is listed or admitted to trading, as the case may be. Such
notice shall indicate the intended record date and the amount and
nature of such dividend or distribution, or the number of shares
subject to such offer for a Pro Rata Repurchase and the purchase price
payable by the Corporation pursuant to such offer, as well as the
Conversion Ratio. A Special Dividend declared pursuant to this
Section 9(C)(i) shall be effective upon payment of any Extraordinary
Distribution, the expiration date (including all extensions thereof)
of any tender offer which is a Pro Rata Repurchase or on the date of
purchase with respect to any Pro Rata Repurchase which is not a tender
offer, as the case may be. Concurrently with the declaration of the
Special Dividend pursuant to this Section 9(C)(i), the Liquidation
Preference and the Dividend Amount of all shares of Series B Preferred
Stock shall be adjusted by dividing the Liquidation Preference and the
Dividend Amount, respectively, in effect immediately before such
Extraordinary Distribution or Pro Rata Repurchase by the Sec. 9(C)
Non-Dilutive Share Fraction.
(ii) The Corporation and the Board of Directors shall
each use its best efforts to take all reasonably necessary steps or to
take all actions as are necessary or appropriate for the declaration
of the Special Dividend provided in Section 9(C)(i) but shall not be
required to call a special meeting of stockholders in order to
implement the provisions hereof. In the event for any reason the
Board of Directors is precluded from giving full effect to the Special
Dividend provided in Section 9(C)(i), then no such Special Dividend
shall be declared, but instead the Conversion Ratio shall
automatically be adjusted by multiplying the Conversion Ratio in
effect immediately before such Extraordinary Distribution or Pro Rata
Repurchase by the Sec. 9(C) Non-Dilutive Share Fraction, and the
Liquidation Preference and the Dividend Amount will not be adjusted.
If subsequently the Board of Directors is able to give full effect to
the Special Dividend as provided in Section 9(C)(i), then such Special
Dividend will be declared in accordance with the provisions of Section
9(C)(i) and the adjustment in the Conversion Price as provided in this
Section 9(C)(ii) will automatically be reversed and nullified
prospectively.
(D) Notwithstanding any other provisions of this Section 9,
the Corporation shall not be required to make any adjustment of the
Conversion Ratio unless such adjustment would require an increase or
decrease equal to at least one percent (1%) in the Conversion Ratio
prior to such adjustment. Any lesser adjustment shall be carried
forward and shall be made no later than the time of, and together
with, the next subsequent adjustment which, together with any
adjustment or adjustments so carried forward, shall amount to an
increase or decrease of at least one percent (1%) in the Conversion
Ratio. All calculations under this Section 9 shall be made to the
nearest one-hundredth of a cent or the nearest one-ten thousandth of a
share, as the case may be.
(E) If the Corporation shall make any dividend or
distribution of the Common Stock or issue any Common Stock, other
capital stock or other equity security of the Corporation or any
rights or warrants to purchase or acquire any such security or any
other transaction related to or having an impact upon its Common Stock
or the Series B Preferred Stock, which transaction does not result in
an adjustment to the Conversion Ratio pursuant to the foregoing
provisions of this Section 9, the Board of Directors of the
Corporation shall consider whether such action is of such a nature
that it adversely affects the holders of the Series B Preferred Stock
and that an adjustment to the Conversion Ratio, the provisions of
Section 5(B) or 6, or a subdivision or combination of the outstanding
shares of Series B Preferred Stock into a greater or lesser number of
such shares should equitably be made in respect of such transaction.
If in such case the Board of Directors of the Corporation in its sole
discretion determines that an adjustment to the Conversion Ratio, the
provisions of Section 5(B) or 6, or a subdivision or combination of
the outstanding shares of Series B Preferred Stock into a greater or
lesser number of such shares should be made, such adjustment,
subdivision or combination shall be made effective as of such date as
determined by the Board of Directors of the Corporation. The
determination of the Board of Directors of the Corporation as to
whether an adjustment to the Conversion Ratio, the provisions of
Section 5(B) or a subdivision or combination of the outstanding shares
of Series B Preferred Stock into a greater or lesser number of such
shares should be made pursuant to the foregoing provisions of this
Section 9(E), and, if so, as to what adjustment, subdivision or
combination should be made, and when, shall be final and binding on
the Corporation and all stockholders of the Corporation. The
Corporation shall be entitled to make such additional adjustment in
the Conversion Ratio and the provisions of Section 5(B), in addition
to those required by the foregoing provisions of this Section 9, as
shall be necessary in order that any dividend or distribution in
shares of capital stock of the Corporation, subdivision,
reclassification or combination of shares of stock of the Corporation
or any recapitalization of the Corporation shall not be taxable to
holders of the Common Stock.
(F) For purposes of this resolution, the following
definitions shall apply:
(i) "Business Day" shall mean each day that is not a
Saturday, Sunday or a date on which federally or state chartered
banking institutions in Chicago, Illinois or New York, New York are
required or authorized to be closed.
(ii) "Extraordinary Distribution" shall mean any
dividend or other distribution (effected while any of the shares of
Series B Preferred Stock are outstanding) of (x) cash, where the
aggregate amount of such cash dividend or distribution together with
the amount of all cash dividends and distributions made during the
preceding 12 months, when combined with the aggregate amount of all
Pro Rata Repurchases (for this purpose, including only that portion of
the aggregate purchase price of each such Pro Rata Repurchase which is
in excess of the Fair Market Value of the Common Stock repurchased as
determined in accordance with Section 9(C)(i)), exceeds ten percent
(10%) of the aggregate Fair Market Value of all shares of Common Stock
outstanding on the record date for determining the shareholders
entitled to receive such Extraordinary Distribution and/or (y) any
shares of capital stock of the Corporation (other than shares of
Common Stock), other securities of the Corporation, evidences of
indebtedness of the Corporation or any other person or any other
property (including shares of any subsidiary of the Corporation), or
any combination thereof. The Fair Market Value of an Extraordinary
Distribution for purposes of Section 9(C) shall be equal to the sum of
the Fair Market Value of such Extraordinary Distribution as of the
date made.
(iii) "Fair Market Value" shall mean, as to shares of
Common Stock or any other class of capital stock or securities of the
Corporation or any other issuer which are publicly traded, the average
of the "Current Market Prices" of such shares or such securities for
each day of the Adjustment Period. The "Fair Market Value" of any
security which is not publicly traded or of any other property shall
mean the fair value thereof as determined by an independent investment
banking or appraisal firm experienced in the valuation of such
securities or property selected in good faith by the Board of
Directors of the Corporation or a committee thereof (which may be the
independent appraiser engaged by any Plan) based on principles
consistently applied, or, if no such investment banking or appraisal
firm is in the good faith judgment of the Board of Directors or such
committee available to make such determination, as determined in good
faith by the Board of Directors of the Corporation or such committee.
(iv) "Current Market Price" of publicly traded shares
of Common Stock or any other class of capital stock or other security
of the Corporation or any other issuer for any day shall mean the last
reported sales price, regular way, or, in case no such reported sale
takes place on such day, the average of the reported closing bid and
asked prices, regular way, in either case as reported on the New York
Stock Exchange Composite Tape, or, if such security is not listed or
admitted to trading on such Exchange, on the principal national
securities exchange on which such security is listed or admitted to
trading, or if not listed or admitted to trading on any national
securities exchange, on the National Association of Securities Dealers
Automated Quotations National Market System, or, if such security is
not listed or admitted to trading on any national securities exchange
or quoted on such National Market System, the average of the closing
bid and asked prices in the over-the-counter market as furnished by
any New York Stock Exchange member firm selected from time to time by
the Board of Directors or a committee thereof for such purpose, in
each case, on each trading day during the Adjustment Period.
(v) "Adjustment Period" shall mean the period of five
(5) consecutive trading days preceding, and including, the date as of
which the Fair Market Value of a security is to be determined.
(vi) "Sec. 9(F) Non-Dilutive Amount" in respect of an
issuance, sale or exchange by the Corporation of any right or warrant
to purchase or acquire shares of Common Stock (including any security
convertible into or exchangeable for shares of Common Stock) shall
mean (x) the product of (I) the Fair Market Value of a share of Common
Stock on the trading day immediately preceding the first public
announcement of such issuance, sale or exchange and (II) the maximum
number of shares of Common Stock which could be acquired on such date
upon the exercise in full of such rights and warrants (including upon
the conversion or exchange of all such convertible or exchangeable
securities), whether or not exercisable (or convertible or
exchangeable) at such date, minus (y) the aggregate amount payable
pursuant to such right or warrant to purchase or acquire such maximum
number of shares of Common Stock; provided, however, that in no event
shall the Sec. 9(F) Non-Dilutive Amount be less than zero. For
purposes of the foregoing sentence, in the case of a security
convertible into or exchangeable for shares of Common Stock, the
amount payable pursuant to a right or warrant to purchase or acquire
shares of Common Stock shall be the Fair Market Value of such security
on the date of the issuance, sale or exchange of such security by the
Corporation.
(vii) "Pro Rata Repurchase" shall mean any purchase of
shares of Common Stock by the Corporation or any subsidiary thereof,
whether for cash, shares of capital stock of the Corporation, other
securities of the Corporation, evidences of indebtedness of the
Corporation or any other person or any other property (including
shares of a subsidiary of the Corporation), or any combination
thereof, effected while any of the shares of Series B Preferred Stock
are outstanding, pursuant to any tender offer or exchange offer
subject to Section 13(e) of the Exchange Act, or any successor
provision of law, or pursuant to any other offer available to
substantially all holders of Common Stock; provided, however, that no
purchase of shares by the Corporation or any subsidiary thereof made
in open market transactions shall be deemed a Pro Rata Repurchase.
For purposes of this Section 9(F) (vii), shares shall be deemed to
have been purchased by the Corporation or any subsidiary thereof "in
open market transactions" if they have been purchased substantially in
accordance with the requirements of Rule 10b-18 as in effect under the
Exchange Act, on the date shares of Series B Preferred Stock are
initially issued by the Corporation or on such other terms and
conditions as the Board of Directors of the Corporation or a committee
thereof shall have determined are reasonably designed to prevent such
purchases from having a material effect on the trading market for the
Common Stock.
(viii) "Valuation Date" with respect to an Extraordi-
nary Distribution shall mean the day immediately preceding (i) the ex-
dividend date for such Extraordinary Distribution with respect to a
security listed on a national securities exchange or (ii) the record
date for such Extraordinary Distribution with respect to a security
which is not listed on a national securities exchange.
Section 10. Retirement of Shares. Any shares of Series B
Preferred Stock acquired by the Corporation by reason of the
conversion or redemption of such shares as provided hereby, or
otherwise so acquired, shall be cancelled as shares of Series B
Preferred Stock and restored to the status of authorized but unissued
shares of Preferred Stock of the Corporation, undesignated as to
series, and may thereafter be reissued as part of a new series of
Preferred Stock as permitted by law.
Section 11. Miscellaneous.
(A) All notices referred to herein shall be in writing, and
all notices hereunder shall be deemed to have been given upon the
earlier of receipt thereof or three (3) Business Days after the
mailing thereof if sent by registered mail (unless first-class mail
shall be specifically permitted for such notice under the terms of
this Certificate) with postage prepaid, addressed: (i) if to the
Corporation, to its office at McDonald's Plaza, Oak Brook, Illinois
60521 (Attention: Secretary) or to the transfer agent for the Series B
Preferred Stock, or other agent of the Corporation designated as
permitted by this Certificate or (ii) if to any holder of the Series B
Preferred Stock or Common Stock, as the case may be, to such holder at
the address of such holder as listed in the stock record books of the
Corporation (which may include the records of any transfer agent for
the Series B Preferred Stock or Common Stock, as the case may be) or
(iii) to such other address as the Corporation or any such holder, as
the case may be, shall have designated by notice similarly given.
(B) In the event that, at any time as a result of an
adjustment made pursuant to Section 9, the holder of any share of the
Series B Preferred Stock upon surrendering such shares for conversion
shall become entitled to receive any shares or other securities of the
Corporation other than shares of Common Stock, the Conversion Ratio in
respect of such other shares or securities so receivable upon
conversion of shares of Series B Preferred Stock shall thereafter be
adjusted, and shall be subject to further adjustment from time to
time, in a manner and on terms as nearly equivalent as practicable to
the provisions with respect to Common Stock contained in Section 9
hereof, and the provisions of each of the other Sections hereof with
respect to the Common Stock shall apply on like or similar terms to
any such other shares or securities.
(C) The Corporation shall pay any and all stock transfer
and documentary stamp taxes that may be payable in respect of any
issuance or delivery of shares of Series B Preferred Stock or shares
of Common Stock or other securities issued on account of Series B
Preferred Stock pursuant hereto or certificates representing such
shares or securities. The Corporation shall not, however, be required
to pay any such tax which may be payable in respect of any transfer
involved in the issuance or delivery of shares of Series B Preferred
Stock or Common Stock or other securities in a name other than that in
which the shares of Series B Preferred Stock with respect to which
such shares or other securities are issued or delivered were
registered, or in respect of any payment to any person with respect to
any such shares or securities other than a payment to the registered
holder thereof, and shall not be required to make any such issuance,
delivery or payment unless and until the person otherwise entitled to
such issuance, delivery or payment has paid to the Corporation the
amount of any such tax or has established, to the satisfaction of the
Corporation, that such tax has been paid or is not payable.
(D) In the event that a holder of shares of Series B
Preferred Stock shall not by written notice designate the name in
which shares of Common Stock to be issued upon conversion of such
shares should be registered or to whom payment upon redemption of
shares of Series B Preferred Stock should be made or the address to
which the certificate or certificates representing such shares, or
such payment, should be sent, the Corporation shall be entitled to
register such shares, and make such payment, in the name of the holder
of such Series B Preferred Stock as shown on the records of the
Corporation and to send the certificate or certificates representing
such shares, or such payment, to the address of such holder shown on
the records of the Corporation.
(E) Unless otherwise provided in this Certificate of
Designation, as the same may be amended, all payments in the form of
dividends, distributions on voluntary or involuntary dissolution,
liquidation or winding-up or otherwise made upon the shares of Series
B Preferred Stock and any other stock ranking on a parity with the
Series B Preferred Stock with respect to such dividend or distribution
shall be made pro rata, so that amounts paid per share on the Series B
Preferred Stock and such other stock shall in all cases bear to each
other the same ratio that the required dividends, distributions or
payments, as the case may be, then payable per share on the shares of
the Series B Preferred Stock and such other stock bear to each other.
(F) The Corporation may appoint, and from time to time
discharge and change, a transfer agent for the Series B Preferred
Stock. Upon any such appointment or discharge of a transfer agent,
the Corporation shall send notice thereof by first-class mail, postage
prepaid, to each holder of record of Series B Preferred Stock.
3. Series C ESOP Convertible Preferred Stock.
RESOLVED, that the issue of a new series of Preferred Stock
(the "Preferred Stock") without par value of the Corporation is hereby
authorized and the designation, number of shares, relative rights,
preferences and powers, and the qualifications, limitations and
restrictions thereof, are hereby fixed as follows:
Section 1. Designation and Amount; Special Purpose
Restricted Transfer Issue.
(A) The shares of such series shall be designated as
"Series C ESOP Convertible Preferred Stock" (the "Series C Preferred
Stock") and the number of shares constituting the Series C Preferred
Stock shall be 5,936,054. Such number may be increased or decreased
by resolution of the Board of Directors (hereinafter called the "Board
of Directors" or the "Board"); provided, that no decrease shall reduce
the number of shares of Series C Preferred Stock to a number less than
the number of shares then outstanding plus the number of shares
reserved for issuance upon the exercise of outstanding options, rights
or warrants issued by, or upon the conversion of any outstanding
securities issued by, the Corporation convertible into Series C
Preferred Stock.
(B) Shares of Series C Preferred Stock shall be issued
(whether upon original issuance or upon transfer) only to a trustee or
trustees (or to any successor trustee or trustees) (collectively, a
"Trustee") acting under a trust agreement for the benefit of
participants in one or more employee stock ownership plans or other
employee benefit plans of the Corporation or of any subsidiary of the
Corporation (any such plan, a "Plan"). In the event of a sale,
distribution or other transfer (any such sale, distribution or other
transfer, a "Transfer") of any shares of Series C Preferred Stock to
any person or entity other than the Corporation or a Trustee, but
excluding a distribution of such shares to participants or
beneficiaries in a Plan pursuant to the terms thereof, the shares of
Series C Preferred Stock which are the subject of a Transfer (the
"Transferred Shares") shall be automatically converted into shares of
the Corporation's Common Stock, without par value ("Common Stock") at
the conversion rate provided in Section 5(A) hereof; provided,
however, that in the event of a foreclosure or other realization upon
shares of Series C Preferred Stock pledged as collateral by or
pursuant to any credit agreement, indenture or other document or
instrument for the financing or refinancing of the initial purchase of
the Series C Preferred Stock by a Plan, the Transferred Shares shall
be automatically converted into shares of Common Stock at the
conversion rate provided in Section 5(B) hereof. In the event of a
Transfer of any shares of Series C Preferred Stock to any person or
entity other than the Corporation or a Trustee in connection with a
distribution of such shares to participants or beneficiaries in a Plan
pursuant to the terms thereof, the Transferred Shares shall
automatically be converted into Common Stock at the conversion rate
provided in Section 5(B) hereof. In each such case conversion will
occur immediately upon such Transfer and without any further action by
the Corporation or the holder of the Transferred Shares and thereafter
(i) any certificates for Transferred Shares shall be deemed to
represent the shares of Common Stock into which such Transferred
Shares have been so converted, (ii) no holder of such Transferred
Shares shall have any of the voting powers, preferences and relative,
participating, optional or special rights of a holder of shares of
Series C Preferred Stock, but, rather, only the powers and rights of a
holder of the Common Stock into which such shares of Series C
Preferred Stock shall be so converted and (iii) the holder of such
Transferred Shares shall be treated for all purposes as the holder of
the shares of Common Stock into which such shares of Series C
Preferred Stock have been automatically converted as of the date of
such Transfer. The pledge of Series C Preferred Stock as collateral
by or pursuant to any credit agreement, indenture or other document or
instrument for the financing or refinancing of the initial purchase of
the Series C Preferred Stock by a Plan shall not constitute a Transfer
for purposes of this Section 1(B), but the foreclosure or other
realization upon such pledged shares shall constitute a Transfer.
Certificates representing shares of Series C Preferred Stock shall be
legended to reflect the restrictions on transfer set forth in this
Section 1(B). Notwithstanding the foregoing provisions of this Section
1(B), shares of Series C Preferred Stock (i) may be converted into
shares of Common Stock pursuant to Section 5 or 6 hereof at any time
prior to a Transfer and the shares of Common Stock issued upon such
conversion will not be subject to any of the restrictions of this
Section 1(B) and (ii) shall be redeemable by the Corporation upon the
terms and conditions provided by Sections 7 and 8 hereof.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of
any series of Preferred Stock (or any similar stock) ranking prior and
superior to the Series C Preferred Stock with respect to dividends,
the holders of shares of Series C Preferred Stock, in preference to
the holders of Common Stock and of any other Junior Stock (as defined
in Section 2(D) hereof), shall be entitled to receive, when, as and if
declared by the Board of Directors, out of funds legally available for
the purpose, cumulative cash dividends payable in an amount per share
equal to $.2898 per quarter and no more (such amount being referred to
herein as the "Dividend Amount"), payable in arrears on the first day
of March, June, September and December in each year (each such date
being referred to herein as "Dividend Payment Date"), commencing on
the first Dividend Payment Date after the first issuance of a share of
Series C Preferred Stock. In the event that any Dividend Payment Date
shall occur on any day other than a "Business Day" (as defined in
Section 9(F) hereof), the dividend payment due on such Dividend
Payment Date shall be paid on the Business Day immediately preceding
such Dividend Payment Date. The Board of Directors may fix a record
date for the determination of holders of shares of Series C Preferred
Stock entitled to receive payment of a dividend or distribution
declared thereon, which record date shall be not more than 60 days
prior to the date fixed for the payment thereof.
(B) Dividends shall begin to accrue on outstanding shares
of Series C Preferred Stock from the date of issue of such shares and
shall accrue on a daily basis whether or not declared and whether or
not the Company shall have earnings or surplus out of which such
dividends could be paid at the time. Dividends accrued on the shares
of Series C Preferred Stock for any period less than a full quarterly
period between Dividend Payment Dates shall be computed on the basis
of a 360-day year of 30-day months. Accrued but unpaid dividends shall
cumulate as of the Dividend Payment Date on which they first become
payable, but no interest shall accrue on accrued or accumulated but
unpaid dividends.
(C) Dividends paid on the shares of Series C Preferred
Stock in an amount less than the total amount of such dividends at the
time accrued and payable on such shares shall be allocated pro rata on
a share-by-share basis among all such shares at the time outstanding.
(D) So long as any Series C Preferred Stock shall be
outstanding, no dividend shall be declared and paid or set apart for
payment on any other series of stock ranking on a parity with the
Series C Preferred Stock as to dividends ("Parity Stock"), unless
there shall also be or have been declared and paid or set apart for
payment on the Series C Preferred Stock dividends for all dividend
payment periods of the Series C Preferred Stock ending on or before
the dividend payment date of such Parity Stock, ratably in proportion
to the respective amounts of dividends on the Series C Preferred Stock
accumulated and unpaid through the most recent such dividend payment
period, and accumulated and unpaid on such Parity Stock through the
dividend payment period on such Parity Stock ending on such dividend
payment date or such dividend payment date immediately preceding such
dividend payment period. So long as any Series C Preferred Stock
shall be outstanding, in the event that full cumulative dividends on
the Series C Preferred Stock have not been declared and paid or set
apart for payment when due, the Corporation shall not declare and pay
or set apart for payment any dividends or make any other distributions
on, or make any payment on account of the purchase, redemption or
other retirement of, Common Stock or any other class of stock or
series thereof of the Corporation ranking, as to dividends or as to
distributions in the event of a liquidation, dissolution or winding-up
of the Corporation, junior to the Series C Preferred Stock
(collectively, "Junior Stock") until full cumulative and unpaid
dividends on the Series C Preferred Stock shall have been paid or
declared and set apart for payment; provided, however, that the
foregoing shall not apply to (i) any dividend payable solely in any
shares of any Junior Stock, or (ii) the acquisition of shares of any
Junior Stock either (x) pursuant to any employee or director incentive
or benefit plan or arrangement of the Corporation or any subsidiary of
the Corporation heretofore or hereafter adopted or (y) in exchange
solely for shares of any other Junior Stock. Subject to the foregoing
provisions of this Section 2(D), the Board of Directors may declare
and the Corporation may pay or set apart for payment dividends and
other distributions on any other Junior Stock or Parity Stock, and may
purchase or otherwise redeem or retire any of the Junior Stock or
Parity Stock or any warrants, rights, or options or other securities
exercisable for or convertible into any of the Junior Stock or Parity
Stock and the holders of shares of the Series C Preferred Stock shall
not be entitled to share therein.
Section 3. Voting Rights. The holders of shares of Series
C Preferred Stock shall have the following voting rights:
(A) Each share of Series C Preferred Stock shall entitle
the holder thereof to one vote on all matters submitted to a vote of
the stockholders of the Corporation; it being understood that whenever
the "Conversion Ratio" (as defined in Section 5(A) hereof) is adjusted
as provided in Section 9 hereof, the number of votes per share of
Series C Preferred Stock shall also be similarly adjusted.
Notwithstanding the foregoing, the number of votes per share of Series
C Preferred Stock shall at no time exceed the highest number then
permitted by the Restated Certificate of Incorporation of the
Corporation as then in effect or by applicable rules and regulations
of the Securities and Exchange Commission or the New York Stock
Exchange. In the event that the number of votes per share of Series C
Preferred Stock is not adjusted upon an adjustment to the Conversion
Ratio as a result of the immediately preceding sentence, then the
Board of Directors shall promptly take such action as may be necessary
to equitably adjust for such adjustment to the Conversion Ratio,
including without limitation, subdividing outstanding shares of Series
C Preferred Stock (by declaring a stock dividend or otherwise) to the
extent the Corporation has authorized shares of Series C Preferred
Stock which are not then outstanding, or designating and issuing
additional shares of Series C Preferred Stock to the extent the
Corporation has authorized shares of Preferred Stock which are not
then outstanding and are undesignated as to series; provided, however,
no such action on the part of the Board of Directors shall adjust or
change the aggregate economic terms assigned to the outstanding shares
of Series C Preferred Stock.
(B) Except as otherwise provided herein, in any other
Certificate of Designations creating a series of Preferred Stock or
any similar stock, or by law, the holders of shares of Series C
Preferred Stock and the holders of shares of Common Stock and any
other capital stock of the Corporation having general voting rights
shall vote together as one class on all matters submitted to a vote of
stockholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by
law, holders of Series C 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 taking any corporate action. Any increase or decrease in
the authorized class of Preferred Stock (but not below the number of
shares thereof then outstanding) shall not be deemed to alter or
change the powers, preferences, or special rights of the shares of
Series C Preferred Stock so as to affect them adversely within the
meaning of the General Corporation Law of the State of Delaware and no
class vote shall be required to authorize such increase or decrease.
(D) If at any time dividends payable on the Series C
Preferred Stock, or on any one or more other series of Preferred Stock
of the Corporation entitled to receive cumulative preferred dividends,
are in arrears and unpaid in an amount equal to or exceeding the
amount of dividends payable on such Series C Preferred Stock and/or
other series of Preferred Stock entitled to receive cumulative
dividends for six quarterly dividend periods, whether or not
consecutive, the holders of all outstanding shares of Preferred Stock
entitled to receive cumulative preferred dividends will have the
exclusive right, voting separately as a class, to elect two directors
to the Board of Directors of the Corporation at the next annual
meeting of stockholders of the Corporation, the authorized number of
Directors not to be increased for this purpose. Such voting right
will continue for such Preferred Stock until all dividends on the
Series C Preferred Stock and on such other series have been paid in
full, at which time such voting right of the holders of such Preferred
Stock will terminate, subject to re-vesting in the event of a
subsequent arrearage. Upon any termination of the aforesaid voting
right, the term of office of those directors elected by holders of
Preferred Stock voting separately as a class will terminate.
Section 4. Liquidation, Dissolution.
(A) Upon any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (i) to the holders of
shares of stock ranking junior with respect to rights to receive
distributions upon liquidation, dissolution or winding up of the
Corporation to the Series C Preferred Stock unless, prior thereto, the
holders of shares of Series C Preferred Stock shall have received an
amount in cash of $16.5625 per share (such amount being referred to
herein as the "Liquidation Preference"), plus an amount in cash equal
to accrued and unpaid dividends thereon, whether or not declared, up
to the date of such payment, or (ii) to the holders of shares of stock
ranking on a parity with respect to the right to receive distributions
upon liquidation, dissolution or winding up of the Corporation with
the Series C Preferred Stock, except distributions made ratably on the
Series C Preferred Stock and all such parity stock in proportion to
the total amounts to which the holders of all such shares are entitled
upon such liquidation, dissolution or winding up. After payment of
the full amount to which they are entitled as provided by the
foregoing provisions of this Section 4(A), the holders of shares of
Series C Preferred Stock shall not be entitled to any further right or
claim to any of the remaining assets of the Corporation.
(B) Neither the merger or consolidation of the Corporation
with or into any other corporation or other entity, nor the merger or
consolidation of any other corporation or other entity with or into
the Corporation, nor the sale, transfer or lease of all or any portion
of the assets of the Corporation, shall be deemed to be a liquidation,
dissolution or winding up of the Corporation for purposes of this
Section 4, and the holders of Series C Preferred Stock shall
nevertheless be entitled in the event of any such merger or
consolidation to the rights provided by Section 8 hereof.
(C) Written notice of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation, stating the
payment date or dates when, and the place or places where, the amounts
distributable to holders of Series C Preferred Stock in such
circumstances shall be payable, shall be given by hand delivery, by
courier, by any standard form of telecommunication or by first-class
mail, postage prepaid, delivered, sent or mailed (as the case may be)
not less than twenty (20) days prior to any payment date stated
therein, to the holders of Series C Preferred Stock, at their
respective addresses shown on the books of the Corporation or any
transfer agent for the Series C Preferred Stock; provided, however,
that a failure to give notice as provided above or any defect therein
shall not affect the Corporation's ability to consummate a voluntary
or involuntary liquidation, dissolution or winding up of the
Corporation.
Section 5. Conversion into Common Stock.
(A) A holder of shares of Series C Preferred Stock shall be
entitled, at any time prior to the close of business on the date fixed
for redemption of such shares pursuant to Section 7 hereof, to cause
any or all of such shares to be converted into validly issued, fully
paid and nonassessable shares of Common Stock, initially at a
conversion rate equal to the ratio of .8000 share of Common Stock for
each one share of Series C Preferred Stock, which conversion rate
shall be adjusted as hereinafter provided (and, as so adjusted,
rounded to the nearest ten-thousandth, is hereinafter sometimes
referred to as the "Conversion Ratio"); provided, however, that, if
the shares of Common Stock have a par value, in no event shall the
Conversion Ratio be greater than the Liquidation Preference divided by
the par value of one share of Common Stock.
(B) Notwithstanding Section 5(A), in the event of an
automatic conversion pursuant to Section 1(B) hereof due to a
distribution of Series C Preferred Stock to participants or
beneficiaries in a Plan or foreclosure or other realization upon
shares of Series C Preferred Stock pledged as collateral by or
pursuant to any credit agreement, indenture or other document or
instrument for the financing or refinancing of the initial purchase of
the Series C Preferred Stock by a Plan, shares of Series C Preferred
Stock shall be converted into validly issued, fully paid and
nonassessable shares of Common Stock at a conversion rate, expressed
as a ratio of shares of Common Stock per share of Series C Preferred
Stock, equal to the greatest of: (i) the Conversion Ratio, (ii) a
fraction, the numerator of which shall be the Fair Market value (as
defined in Section 9(F) hereof) of one share of Series C Preferred
Stock (plus an amount equal to accrued and unpaid dividends thereon,
if such dividends have not already been taken into account in
determining the Fair Market Value) and the denominator of which shall
be the Fair Market Value of one share of Common Stock, both computed
as of the date of conversion, or (iii) the lesser of: (A) one share of
Common Stock per share of Series C Preferred Stock, adjusted
accordingly with adjustments in the Conversion Ratio pursuant to
Section 9 hereof, or (B) a fraction, the numerator of which shall be
the Liquidation Preference plus an amount equal to accrued and unpaid
dividends thereon and the denominator of which shall be the Fair
Market Value of one share of Common Stock on the date of conversion.
(C) Any holder of shares of Series C Preferred Stock
desiring to convert such shares into shares of Common Stock shall
surrender the certificate or certificates representing the shares of
Series C Preferred Stock being converted, duly assigned or endorsed
for transfer to the Corporation (or accompanied by duly executed stock
powers relating thereto), at the principal executive office of the
Corporation or the offices of the transfer agent for the Series C
Preferred Stock or such office or offices in the continental United
States of an agent for conversion as may from time to time be
designated by notice to the holders of the Series C Preferred Stock by
the Corporation or the transfer agent for the Series C Preferred
Stock, accompanied by written notice of conversion. Such notice of
conversion shall specify (i) the number of shares of Series C
Preferred Stock to be converted and the name or names in which such
holder wishes the certificate or certificates for Common Stock to be
issued and for any shares of Series C Preferred Stock not to be so
converted to be issued (subject to compliance with applicable legal
requirements if any of said certificates are to be issued in a name
other than the name of the holder), and (ii) the address to which such
holder wishes delivery to be made of such new certificates to be
issued upon such conversion.
(D) Upon surrender of a certificate representing a share or
shares of Series C Preferred Stock for conversion, the Corporation or
the transfer agent for the Common Stock shall, as promptly as
practicable after such surrender, issue and deliver to the holder
thereof or to such holder's designee, at the address designated by
such holder, a certificate or certificates for the number of shares of
Common Stock to which such holder shall be entitled upon conversion,
together with any cash adjustment of any fraction of a share as
hereinafter provided. In the event that there shall have been
surrendered a certificate or certificates representing shares of
Series C Preferred Stock, only part of which are to be converted, the
Corporation shall issue and deliver to such holder or such holder's
designee a new certificate or certificates representing the number of
shares of Series C Preferred Stock which shall not have been
converted.
(E) A conversion of shares of Series C Preferred Stock into
shares of Common Stock shall be effective (i) if made at the option of
the holder thereof, as of the close of business on the day on which
the Corporation receives written notice of conversion pursuant to
Section 5(C) or (ii) if made pursuant to Section 1(B) hereof, at the
time of Transfer. On and after the effective date of conversion, the
shares of Series C Preferred so converted shall no longer be deemed to
be outstanding for any purpose, and the person or persons entitled to
receive the Common Stock issuable upon such conversion shall be
treated for all purposes as the record holder or holders of such
shares of Common Stock, but no allowance or adjustment shall be made
in respect of dividends payable to holders of Common Stock of record
on any date prior to such effective date. The Corporation shall not
be obligated to pay any dividends which shall have been declared and
shall be payable to holders of shares of Series C Preferred Stock on a
Dividend Payment Date if such Dividend Payment Date for such dividend
shall be on or subsequent to the effective date of conversion of such
shares, unless such declared dividends have been set aside for payment
prior to the effective date of conversion of such shares, which
dividends shall be paid on the applicable Dividend Payment Date.
(F) Whenever the Corporation shall issue shares of Common
Stock upon conversion of shares of Series C Preferred Stock as
contemplated by this Section 5, the Corporation shall issue together
with each such share of Common Stock one right to purchase Series A
Junior Participating Preferred Stock of the Corporation (or other
securities in lieu thereof) pursuant to the Rights Agreement dated as
of December 13, 1988 between the Corporation and The First National
Bank of Chicago, as Rights Agent, as such agreement has been, and may
from time to time be, amended (such Agreement, as so amended, is
hereinafter referred to as the "Rights Agreement"), or any rights
issued to holders of Common Stock in addition thereto or in
replacement therefor, whether or not such rights shall be exercisable
at such time, but only if such rights are issued and outstanding and
held by other holders of Common Stock at such time and have not
expired.
Section 6. Other Conversion Rights. In addition to the
conversion rights provided in Section 5(A) and 5(B) hereof, shares of
Series C Preferred Stock may be converted into shares of Common Stock
at the option of the holder at any time and from time to time upon
notice to the Corporation given not less than five (5) Business Days
prior to the date fixed by the holder in such notice for such
conversion, (A) when and to the extent necessary for such holder to
provide for distributions required to be made under, or to satisfy an
investment election provided to participants in accordance with, a
Plan, to participants in such Plan at a conversion rate, expressed as
a ratio of shares of Common Stock per share of Series C Preferred
Stock, equal to the greater of (i) the Conversion Ratio or (ii) a
fraction, the numerator of which shall be the Fair Market Value of one
share of Series C Preferred Stock (plus accrued and unpaid dividends
thereon to the date of conversion if such dividends have not already
been taken into account in determining Fair Market Value) and the
denominator of which shall be the Fair Market Value of one share of
Common Stock, both computed as of the date of conversion, or (B) in
the event that the Plan is determined by the Internal Revenue Service
not to be qualified within the meaning of Sections 401(a) and
4975(e)(7) of the Internal Revenue Code of 1986, as amended (the
"Code"), at a conversion rate, expressed as a ratio of shares of
Common Stock per share of Series C Preferred Stock, equal to the
greatest of (i) a fraction, the numerator of which shall be the Fair
Market Value of one share of Series C Preferred Stock plus an amount
equal to accrued and unpaid dividends thereon (if such dividends have
not already been taken into account in determining the Fair Market
Value) and the denominator of which shall be the Fair Market Value of
one share of Common Stock, both computed as of the date of conversion,
(ii) a fraction, the numerator of which shall be the Liquidation
Preference plus accrued but unpaid dividends thereon to the date of
conversion and the denominator of which shall be the Fair Market Value
of one share of Common Stock on the date of conversion or (iii) the
Conversion Ratio.
Section 7. Redemption at the Option of the Corporation.
(A) The Series C Preferred Stock shall be redeemable, in
whole or in part, at the option of the Corporation, out of funds
legally available therefor, at any time after April 1, 1994, at the
following redemption prices:
Redemption Price As
During the Twelve-Month A Percentage of
Period Beginning April 1 Liquidation Preference
------------------------ ----------------------
1991 107.0
1992 106.3
1993 105.6
1994 104.9
1995 104.2
1996 103.5
1997 102.8
1998 102.1
1999 101.4
2000 100.7
and thereafter at the Liquidation Preference, plus in each case, an
amount equal to all accrued and unpaid dividends thereon to the date
fixed for redemption. Payment of the redemption price shall be made
by the Corporation in cash or shares of Common Stock, or a combination
thereof, as permitted by Section 7(E). From and after the close of
business on the date fixed for redemption, dividends on shares of
Series C Preferred Stock called for redemption will cease to accrue,
such shares will no longer be deemed to be outstanding and all rights
in respect of such shares of the Corporation shall cease, except the
right to receive the redemption price; provided that shares of Series
C Preferred Stock may be converted pursuant to Section 5 or, if
applicable, Section 6 hereof at any time prior to the close of
business on the date fixed for redemption of such shares pursuant to
Section 7 or 8 hereof. No interest shall accrue on the redemption
price after the date fixed for redemption. If less than all of the
outstanding shares of Series C Preferred Stock are to be redeemed, the
Corporation shall select the shares to be redeemed in the manner
determined by the Board of Directors of the Corporation.
(B) Unless otherwise required by law, notice of redemption
with respect to a redemption pursuant to paragraphs (A), (C) or (D) of
this Section 7 will be sent to the holders of Series C Preferred Stock
at the address shown on the books of the Corporation or any transfer
agent for the Series C Preferred Stock by hand delivery, by courier,
by any standard form of telecommunication or by first class mail,
postage prepaid, delivered, sent or mailed (as the case may be) not
less than twenty (20) days nor more than sixty (60) days prior to the
redemption date. Each such notice shall state: (i) the redemption
date; (ii) the total number of shares of the Series C Preferred Stock
to be redeemed and, if fewer than all the shares held by such holder
are to be redeemed, the number of such shares to be redeemed from such
holder; (iii) the redemption price and method of payment therefor;
(iv) the place or places where certificates for such shares are to be
surrendered for payment of the redemption price; (v) that dividends on
the shares to be redeemed will cease to accrue on such redemption
date; and (vi) the conversion rights of the shares to be redeemed, the
period within which conversion rights may be exercised, and the
Conversion Ratio in effect at the time. Upon surrender of the
certificates for any shares called for redemption pursuant to the
provisions of this Section 7 or the provisions of Section 8 hereof,
which shares have not previously been converted, such shares shall be
redeemed by the Corporation at the date fixed for redemption and at
the applicable redemption price set forth in this Section 7 or in
Section 8 hereof.
(C) In the event (i) of a change in the federal tax law of
the United States of America or a determination by a court of
competent jurisdiction, which, in either case, has the effect of
precluding the Corporation from claiming any of the tax deductions for
dividends paid on the Series C Preferred Stock when such dividends are
used as provided under Section 404(k)(2) of the Internal Revenue Code
of 1986, as amended (the "Code") and in effect on the date shares of
Series C Preferred Stock are initially issued, or (ii) that shares of
Series C Preferred Stock are held by an employee benefit plan intended
to qualify as an employee stock ownership plan within the meaning of
Section 4975 of the Code, as amended, and such plan is determined by
the Internal Revenue Service not to qualify, the Corporation may, in
its sole discretion and notwithstanding anything to the contrary in
Section 7(A), elect to redeem such shares, out of funds legally
available therefor, at a redemption price equal to the greater of (i)
the Liquidation Preference plus an amount equal to accrued and unpaid
dividends or (ii) the Fair Market Value of a share of Series C
Preferred Stock, plus an amount equal to all accrued and unpaid
dividends thereon to the date fixed for redemption if such dividends
have not already been taken into account in determining Fair Market
Value, and otherwise on the terms and conditions set forth in Sections
7(A) and 7(B).
(D) Notwithstanding anything to the contrary in Section
7(A), the Corporation may elect to redeem any or all of the shares of
Series C Preferred Stock at any time on or prior to April 1, 1994, out
of funds legally available therefor, at a redemption price equal to
the greater of (i) the applicable redemption price specified in
Section 7(A) hereof plus an amount equal to accrued and unpaid
dividends, or (ii) the Fair Market Value of a share of Series C
Preferred Stock, plus an amount equal to all accrued and unpaid
dividends thereon to the date fixed for redemption if such dividends
have not already been taken into account in determining Fair Market
Value, and otherwise on the terms and conditions set forth in Sections
7(A) and 7(B), if the Corporation terminates an employee stock
ownership plan or employee benefit plan pursuant to which shares of
Series C Preferred Stock are then held by a Trustee (in which case
only the shares held pursuant to such plan may be so redeemed).
(E) The Corporation, at its option, may make payment of the
redemption price required upon redemption of shares of Series C
Preferred Stock in cash or in shares of Common Stock, or in a
combination of such shares and cash, any such shares to be valued for
such purpose at their Fair Market Value as of the date of redemption.
Section 8. Consolidation, Combination, Merger, etc.
(A) In the event that the Corporation shall consummate any
exchange offer, liquidation, tender offer, consolidation, merger,
combination, reclassification, recapitalization or other transaction
pursuant to which the outstanding shares of Common Stock are by
operation of law exchanged solely for or changed, reclassified or
converted solely into, stock of any successor or resulting company
(including the Corporation) that constitutes "qualifying employer
securities" with respect to a holder of Series C Preferred Stock
within the meaning of Section 409(a) of the Code and Section 407(d)(5)
of the Employee Retirement Income Security Act of 1974, as amended, or
any successor provisions of law (together, if applicable, with a cash
payment in lieu of fractional shares), the shares of Series C
Preferred Stock of such holder shall in connection therewith be
assumed by and shall become preferred stock of such successor or
resulting company, having in respect of such company insofar as
possible the same powers, preferences and relative, participating,
optional or other special rights (including the redemption rights
provided by Sections 6, 7 and 8 hereof), and the qualifications,
limitations or restrictions thereon, that the Series C Preferred Stock
had immediately prior to such transaction, except that after such
transaction each share of the Series C Preferred Stock shall be
convertible, otherwise on the terms and conditions provided by Section
5 or 6 hereof, into the number and kind of qualifying employer
securities so receivable by a holder of the number of shares of Common
Stock into which such shares of Series C Preferred Stock could have
been converted pursuant to Section 5(A) hereof immediately prior to
such transaction or, if Section 5(B) or 6 hereof is thereafter
applicable, into the kind of qualifying employer securities so
receivable by a holder of one share of Common Stock and the number of
such shares determined pursuant to Section 5(B) or 6; provided,
however, that if by virtue of the structure of such transaction, a
holder of Common Stock is required to make an election with respect to
the nature and kind of consideration to be received in such transac-
tion, which election cannot practicably be made by the holders of the
Series C Preferred Stock, then such election shall be deemed to be
solely for "qualifying employer securities" (together, if applicable,
with a cash payment in lieu of fractional shares) with the effect
provided above on the basis of the number and kind of qualifying
employer securities receivable by a holder of the number of shares of
Common Stock into which the shares of Series C Preferred Stock could
have been converted pursuant to Section 5(A) hereof immediately prior
to such transaction or if Section 5(B) or 6 hereof is thereafter
applicable, into the kind of qualifying employer securities receivable
by a holder of one share of Common Stock and the number of such shares
determined pursuant to Section 5(B) or 6 (it being understood that if
the kind or amount of qualifying employer securities receivable in
respect of each share of Common Stock upon such transaction is not the
same for each such share, then the kind and amount of qualifying
employer securities deemed to be receivable in respect of each share
of Common Stock for purposes of this proviso shall be the kind and
amount so receivable per share of Common Stock by a plurality of such
shares). The rights of the Series C Preferred Stock as preferred
stock of such successor or resulting company shall successively be
subject to adjustments pursuant to Section 9 hereof after any such
transaction as nearly equivalent as practicable to the adjustments
provided for by such Section prior to such transaction. The
Corporation shall not consummate any such merger, consolidation or
similar transaction unless all then outstanding shares of the Series C
Preferred Stock shall be assumed and authorized by the successor or
resulting company pursuant to this Section 8(A).
(B) In the event that the Corporation shall consummate any
exchange offer, liquidation, tender offer, consolidation, merger,
combination, reclassification, recapitalization or other transaction,
pursuant to which the outstanding shares of Common Stock are by
operation of law exchanged for or changed, reclassified or converted
into other stock or securities or cash or any other property, or any
combination thereof, other than any such consideration which is
constituted solely of qualifying employer securities (as referred to
in Section 8(A)) and cash payments, if applicable, in lieu of
fractional shares, outstanding shares of Series C Preferred Stock
shall, without any action on the part of the Corporation or any holder
thereof (but subject to Section 8(C)), be automatically converted by
virtue of such merger, consolidation, combination or similar business
combination transaction immediately prior to its consummation into the
number of shares of Common Stock into which such shares of Series C
Preferred Stock could have been converted at such time so that each
share of Series C Preferred Stock, shall, by virtue of such
transaction and on the same terms as apply to the holders of Common
Stock, be converted into or exchanged for the aggregate amount of
stock, securities, cash or other property (payable in like kind)
receivable by a holder of the number of shares of Common Stock into
which such shares of Series C Preferred Stock could have been
converted pursuant to Section 5(A) hereof immediately prior to such
transaction; provided, however, that if by virtue of the structure of
such transaction a holder of Common Stock is required to make an
election with respect to the nature and kind of consideration to be
received in such transaction, which election cannot practicably be
made by the holders of the Series C Preferred Stock, then the shares
of Series C Preferred Stock shall, by virtue of such transaction and
on the same terms as apply to the holders of Common Stock, be
converted into or exchanged for the aggregate amount of such stock,
securities, cash or other property (payable in kind) receivable by a
holder of the number of shares of Common Stock into which such shares
of Series C Preferred Stock could have been converted immediately
prior to such transaction if such holder of Common Stock had elected
to receive the maximum amount of qualifying employer securities
offered (it being understood that if the kind or amount of stock,
securities, cash or other property receivable upon such transaction is
not the same for each share which so elected the maximum amount of
qualifying employer securities, then the kind and amount of stock,
securities, cash or other property receivable upon such transaction
for each such share shall be the kind and amount so receivable per
share by a plurality of the shares which so elected the maximum amount
of qualifying employer securities).
(C) In the event the Corporation shall enter into any
agreement providing for any exchange offer, liquidation, tender offer,
consolidation, merger, combination, reclassification, recapitalization
or other transaction, described in Section 8(B), then the Corporation
shall as soon as practicable thereafter (and in any event at least ten
(10) Business Days before consummation of such transaction) give
notice of such agreement and the material terms thereof to each holder
of Series C Preferred Stock and each such holder shall have the right
to elect, by written notice to the Corporation, to receive, upon
consummation of such transaction (if and when such transaction is
consummated), out of funds legally available therefor, from the
Corporation or the successor of the Corporation, in redemption and
retirement of such Series C Preferred Stock, a cash payment equal to
the redemption price specified in Section 7(A) hereof in effect on the
date set for redemption plus an amount equal to all accrued and unpaid
dividends. No such notice of redemption shall be effective unless
given to the Corporation prior to the close of business on the
Business Day prior to consummation of such transaction, unless the
Corporation or the successor of the Corporation shall waive such prior
notice, but any notice of redemption so given prior to such time may
be withdrawn by notice of withdrawal given to the Corporation prior to
the close of business on the Business Day prior to consummation of
such transaction.
Section 9. Anti-Dilution Adjustments.
(A) (i) Subject to the provisions of Sections 9(D) and
9(E) hereof, in the event the Corporation shall, at any time or from
time to time while any of the shares of the Series C Preferred Stock
are outstanding, (x) pay a dividend or make a distribution in respect
of the Common Stock in shares of Common Stock or (y) subdivide the
outstanding shares of Common Stock into a greater number of shares, in
each case whether by reclassification of shares, recapitalization of
the Corporation, a recapitalization or reclassification effected by a
merger, consolidation or other transaction to which Section 8 hereof
applies or otherwise, then, in such event, the Board of Directors
shall, to the extent legally permissible, declare a dividend in
respect of the Series C Preferred Stock in shares of Series C
Preferred Stock (a "Special Dividend") in such a manner that a holder
of Series C Preferred Stock will become the holder of that number of
shares of Series C Preferred Stock equal to the product of the number
of such shares held prior to such event times a fraction (the "Sec.
9(A) Non-Dilutive Share Fraction"), the numerator of which is the
number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common
Stock outstanding immediately before such event. A Special Dividend
declared pursuant to this paragraph 9(A)(i) shall be effective upon
payment of such dividend or distribution in respect of the Common
Stock and in the case of a subdivision shall become effective
immediately as of the effective date thereof. Concurrently with the
declaration of the Special Dividend pursuant to this paragraph
9(A)(i), the Liquidation Preference and the Dividend Amount of all
shares of Series C Preferred Stock shall be adjusted by dividing the
Liquidation Preference and the Dividend Amount, respectively, in
effect immediately before such event by the Sec. 9(A) Non-Dilutive
Share Fraction.
(ii) The Corporation and the Board of Directors shall
each use its best efforts to take all necessary steps or to take all
actions as are reasonably necessary or appropriate for declaration of
the Special Dividend provided in paragraph 9(A)(i) but shall not be
required to call a special meeting of stockholders in order to
implement the provisions thereof. If for any reason the Board of
Directors is precluded from giving full effect to the Special Dividend
provided in paragraph 9(A)(i), then no such Special Dividend shall be
declared, but instead the Conversion Ratio shall automatically be
adjusted by multiplying the Conversion Ratio in effect immediately
before the event by the Sec. 9(A) Non-Dilutive Share Fraction, and the
Liquidation Preference and the Dividend Amount will not be adjusted.
An adjustment to the Conversion Ratio made pursuant to this paragraph
9(A)(ii) shall be given effect upon payment of such a dividend or
distribution as of the record date for the determination of holders
entitled to receive such dividend or distribution (on a retroactive
basis) and in the case of a subdivision shall become effective
immediately as of the effective date thereof. If subsequently the
Board of Directors is able to give full effect to the Special Dividend
as provided in paragraph 9(A)(i), then such Special Dividend will be
declared in accordance with the provisions of paragraph 9(A)(i) and
the adjustment in the Conversion Ratio as provided in this paragraph
9(A)(ii) will automatically be reversed and nullified prospectively.
(iii) Subject to the provisions of Sections 9(D) and
9(E) hereof, in the event the Corporation shall, at any time or from
time to time while any of the shares of the Series C Preferred Stock
are outstanding, combine the outstanding shares of Common Stock into a
lesser number of shares, whether by reclassification of shares,
recapitalization of the Corporation, a recapitalization or
reclassification effected by a merger, consolidation or other
transaction to which Section 8 hereof applies or otherwise, then, in
such event, the Conversion Ratio shall automatically be adjusted by
multiplying the Conversion Ratio in effect immediately before such
event by the Sec. 9(A) Non-Dilutive Share Fraction, and the
Liquidation Preference and the Dividend Amount will not be adjusted.
An adjustment to the Conversion Ratio made pursuant to this paragraph
9(A)(iii) shall be given effect immediately as of the effective date
of such combination.
(B) (i) Subject to the provisions of Sections 9(D) and
(E) hereof, in the event the Corporation shall, at any time or from
time to time while any of the shares of Series C Preferred Stock are
outstanding, issue, sell or exchange shares of Common Stock (other
than pursuant to (x) any right or warrant to purchase or acquire
shares of Common Stock (including as such a right or warrant any
security convertible into or exchangeable for shares of Common Stock),
(y) the Rights Agreement or (z) any employee or director incentive,
compensation or benefit plan or arrangement of the Corporation or any
subsidiary of the Corporation heretofore or hereafter adopted) for a
consideration having a Fair Market Value on the date of issuance, sale
or exchange less than the Fair Market Value of such shares on the date
of issuance, sale or exchange, then, in such event, the Board of
Directors shall, to the extent legally permissible, declare a Special
Dividend in such a manner that a holder of Series C Preferred Stock
will become the holder of that number of shares of Series C Preferred
Stock equal to the product of the number of such shares held prior to
such event times a fraction (the "Sec. 9(B)(i) Non-Dilutive Share
Fraction"), the numerator of which is the number of shares of Common
Stock outstanding immediately before the public announcement of such
issuance, sale or exchange plus the number of shares of Common Stock
so issued, sold or exchanged by the Corporation and the denominator of
which is the number of shares of Common Stock outstanding immediately
before the public announcement of such issuance, sale or exchange plus
the number of shares of Common Stock which could be purchased at the
Fair Market Value of the consideration received by the Corporation in
respect of such issuance, sale or exchange. A Special Dividend
declared pursuant to this paragraph 9(B)(i) shall be effective upon
such issuance, sale or exchange. Concurrently with the declaration of
the Special Dividend pursuant to this paragraph 9(B)(i), the
Liquidation Preference and the Dividend Amount of all shares of Series
C Preferred Stock shall be adjusted by dividing the Liquidation
Preference and the Dividend Amount, respectively, in effect
immediately before such issuance, sale or exchange by the Sec. 9(B)(i)
Non-Dilutive Share Fraction.
(ii) Subject to the provisions of Sections 9(D) and
9(E) hereof, in the event the Corporation shall, at any time or from
time to time while any shares of Series C Preferred Stock are
outstanding issue, sell or exchange any right or warrant to purchase
or acquire shares of Common Stock (including as such a right or
warrant any security convertible into or exchangeable for shares of
Common Stock and rights issued under the Rights Agreement), other than
any such issuance to holders of shares of Common Stock as a dividend
or distribution (including by way of a reclassification of shares or a
recapitalization of the Corporation) and other than pursuant to any
employee or director incentive, compensation or benefit plan or
arrangement of the Corporation or any subsidiary of the Corporation
heretofore or hereafter adopted, exercisable for a consideration
having a Fair Market Value per share of Common Stock on the date of
such issuance, sale or exchange less than the Sec. 9(F) Non-Dilutive
Amount (as defined in paragraph 9(F)(vi)), then in such event, the
Board of Directors shall, to the extent legally permissible, declare a
Special Dividend in such a manner that a holder of Series C Preferred
Stock will become the holder of that number of shares of Series C
Preferred Stock equal to the product of the number of such shares held
prior to such event times a fraction (the "Sec. 9(B)(ii) Non-Dilutive
Share Fraction"), the numerator of which is the number of shares of
Common Stock outstanding immediately before such issuance of rights or
warrants plus the maximum number of shares of Common Stock that could
be acquired upon exercise in full of all such rights and warrants and
the denominator of which is the number of shares of Common Stock
outstanding immediately before such issuance of rights or warrants
plus the number of shares of Common Stock which could be purchased at
the Fair Market Value of a share of Common Stock at the time of such
issuance for the maximum aggregate consideration payable upon exercise
in full of all such rights or warrants and any other amounts paid in
connection with such issuance of rights or warrants. A Special
Dividend declared pursuant to this paragraph 9(B)(ii) shall be
effective upon such issuance, sale or exchange. Concurrently with the
declaration of the Special Dividend pursuant to this paragraph
9(B)(ii), the Liquidation Preference and the Dividend Amount of all
shares of Series C Preferred Stock shall be adjusted by dividing the
Liquidation Preference and the Dividend Amount, respectively, in
effect immediately before such issuance of rights or warrants by the
Sec. 9(B)(ii) Non-Dilutive Share Fraction.
(iii) The Corporation and the Board of Directors shall
each use its best efforts to take all necessary steps or to take all
actions as are reasonably necessary or appropriate for declaration of
the Special Dividend provided in paragraphs 9(B)(i) and 9(B)(ii) but
shall not be required to call a special meeting of stockholders in
order to implement the provisions hereof. In the event for any reason
the Board of Directors is precluded from giving full effect to the
Special Dividend provided in paragraphs 9(B)(i) or 9(B)(ii), then no
such Special Dividend shall be declared, but instead the Conversion
Ratio shall automatically be adjusted by multiplying the Conversion
Ratio in effect immediately before such issuance of shares, rights or
warrants by the Sec. 9(B)(i) or 9(B)(ii) Non-Dilutive Share Fraction,
as the case may be, and the Liquidation Preference and Dividend Amount
will not be adjusted. If subsequently the Board of Directors is able
to give full effect to the Special Dividend as provided in paragraphs
9(B)(i) or 9(B)(ii), then such Special Dividend will be declared in
accordance with the provisions of paragraphs 9(B)(i) or 9(B)(ii), as
the case may be, and the adjustment in the Conversion Ratio as
provided in this paragraph 9(B)(iii) will automatically be reversed
and nullified prospectively.
(C) (i) Subject to the provisions of Sections 9(D) and
9(E) hereof, in the event the Corporation shall, at any time or from
time to time while any of the shares of Series C Preferred Stock are
outstanding, make an Extraordinary Distribution (as hereinafter
defined) in respect of the Common Stock, whether by dividend,
distribution, reclassification of shares or recapitalization of the
Corporation (including a recapitalization or reclassification effected
by a transaction to which Section 8 hereof does not apply) or effect a
Pro Rata Repurchase (as hereinafter defined) of Common Stock, then, in
such event, the Board of Directors shall, to the extent legally
permissible, declare a Special Dividend in such a manner that a holder
of Series C Preferred Stock will become the holder of that number of
shares of Series C Preferred Stock equal to the product of the number
of such shares held prior to such event times a fraction (the "Sec.
9(C) Non-Dilutive Share Fraction"), the numerator of which is the
product of (x) the number of shares of Common Stock outstanding
immediately before such Extraordinary Distribution or Pro Rata
Repurchase minus, in the case of a Pro Rata Repurchase, the number of
shares of Common Stock repurchased by the Corporation multiplied by
(y) the Fair Market Value of a share of Common Stock on the Valuation
Date (as defined in paragraph 9(F)(viii)) with respect to an
Extraordinary Distribution or on the expiration date (including all
extensions thereof) of any tender offer which is a Pro Rata Repurchase
or on the date of purchase with respect to any Pro Rata Repurchase
which is not a tender offer, as the case may be, and the denominator
of which is (x) the product of (I) the number of shares of Common
Stock outstanding immediately before such Extraordinary Distribution
or Pro Rata Repurchase multiplied by (II) the Fair Market Value of a
share of Common Stock on the Valuation Date with respect to an
Extraordinary Distribution, or on the expiration date (including all
extensions thereof) of any tender offer which is a Pro Rata
Repurchase, or on the date of purchase with respect to any Pro Rata
Repurchase which is not a tender offer, as the case may be, minus (y)
the Fair Market Value of the Extraordinary Distribution or the
aggregate purchase price of the Pro Rata Repurchase, as the case may
be. The Corporation shall send each holder of Series C Preferred
Stock (x) notice of its intent to make any Extraordinary Distribution
and (y) notice of any offer by the Corporation to make a Pro Rata
Repurchase, in each case at the same time as, or as soon as
practicable after, such offer is first communicated to holders of
Common Stock or the record date for such dividend is announced in
accordance with the rules of any stock exchange on which the Common
Stock is listed or admitted to trading, as the case may be. Such
notice shall indicate the intended record date and the amount and
nature of such dividend or distribution, or the number of shares
subject to such offer for a Pro Rata Repurchase and the purchase price
payable by the Corporation pursuant to such offer, as well as the
Conversion Ratio. A Special Dividend declared pursuant to this
paragraph 9(C)(i) shall be effective upon payment of any Extraordinary
Distribution, the expiration date (including all extensions thereof)
of any tender offer which is a Pro Rata Repurchase or on the date of
purchase with respect to any Pro Rata Repurchase which is not a tender
offer, as the case may be. Concurrently with the declaration of the
Special Dividend pursuant to this paragraph 9(C)(i), the Liquidation
Preference and the Dividend Amount of all shares of Series C Preferred
Stock shall be adjusted by dividing the Liquidation Preference and the
Dividend Amount, respectively, in effect immediately before such
Extraordinary Distribution or Pro Rata Repurchase by the Sec. 9(C)
Non-Dilutive Share Fraction.
(ii) The Corporation and the Board of Directors shall
each use its best efforts to take all reasonably necessary steps or to
take all actions as are necessary or appropriate for the declaration
of the Special Dividend provided in paragraph 9(C)(i) but shall not be
required to call a special meeting of stockholders in order to
implement the provisions hereof. In the event for any reason the
Board of Directors is precluded from giving full effect to the Special
Dividend provided in paragraph 9(C)(i), then no such Special Dividend
shall be declared, but instead the Conversion Ratio shall
automatically be adjusted by multiplying the Conversion Ratio in
effect immediately before such Extraordinary Distribution or Pro Rata
Repurchase by the Sec. 9(C) Non-Dilutive Share Fraction, and the
Liquidation Preference and the Dividend Amount will not be adjusted.
If subsequently the Board of Directors is able to give full effect to
the Special Dividend as provided in paragraph 9(C)(i), then such
Special Dividend will be declared in accordance with the provisions of
paragraph 9(C)(i) and the adjustment in the Conversion Price as
provided in this paragraph 9(C)(ii) will automatically be reversed and
nullified prospectively.
(D) Notwithstanding any other provisions of this Section 9,
the Corporation shall not be required to make any adjustment of the
Conversion Ratio unless such adjustment would require an increase or
decrease equal to at least one percent (1%) in the Conversion Ratio
prior to such adjustment. Any lesser adjustment shall be carried
forward and shall be made no later than the time of, and together
with, the next subsequent adjustment which, together with any
adjustment or adjustments so carried forward, shall amount to an
increase or decrease of at least one percent (1%) in the Conversion
Ratio. All calculations under this Section 9 shall be made to the
nearest one-hundredth of a cent or the nearest one-ten thousandth of a
share, as the case may be.
(E) If the Corporation shall make any dividend or
distribution of the Common Stock or issue any Common Stock, other
capital stock or other equity security of the Corporation or any
rights or warrants to purchase or acquire any such security or any
other transaction related to or having an impact upon its Common Stock
or the Series C Preferred Stock, which transaction does not result in
an adjustment to the Conversion Ratio pursuant to the foregoing
provisions of this Section 9, the Board of Directors of the
Corporation shall consider whether such action is of such a nature
that it adversely affects the holders of the Series C Preferred Stock
and that an adjustment to the Conversion Ratio, the provisions of
Sections 5(B) or 6, or a subdivision or combination of the outstanding
shares of Series C Preferred Stock into a greater or lesser number of
such shares should equitably be made in respect of such transaction.
If in such case the Board of Directors of the Corporation in its sole
discretion determines that an adjustment to the Conversion Ratio, the
provisions of Sections 5(B) or 6, or a subdivision or combination of
the outstanding shares of Series C Preferred Stock into a greater or
lesser number of such shares should be made, such adjustment,
subdivision or combination shall be made effective as of such date as
determined by the Board of Directors of the Corporation. The
determination of the Board of Directors of the Corporation as to
whether an adjustment to the Conversion Ratio, the provisions of
Section 5(B) or 6, or a subdivision or combination of the outstanding
shares of Series C Preferred Stock into a greater or lesser number of
such shares should be made pursuant to the foregoing provisions of
this Section 9(E), and, if so as to what adjustment, subdivision or
combination should be made and when, shall be final and binding on the
Corporation and all stockholders of the Corporation. The Corporation
shall be entitled to make such additional adjustment in the Conversion
Ratio and the provisions of Section 5(B) or 6, in addition to those
required by the foregoing provisions of this Section 9, as shall be
necessary in order that any dividend or distribution in shares of
capital stock of the Corporation, subdivision, reclassification or
combination of shares of stock of the Corporation or any
recapitalization of the Corporation shall not be taxable to holders of
the Common Stock.
(F) For purposes of this resolution, the following
definitions shall apply:
(i) "Business Day" shall mean each day that is not a
Saturday, Sunday or a date on which federally or state chartered
banking institutions in Chicago, Illinois or New York, New York are
required or authorized to be closed.
(ii) "Extraordinary Distribution" shall mean any
dividend or other distribution (effected while any of the shares of
Series C Preferred Stock are outstanding) of (x) cash, where the
aggregate amount of such cash dividend or distribution together with
the amount of all cash dividends and distributions made during the
preceding 12 months, when combined with the aggregate amount of all
Pro Rata Repurchases (for this purpose, including only that portion of
the aggregate purchase price of each such Pro Rata Repurchase which is
in excess of the Fair Market Value of the Common Stock repurchased as
determined in accordance with paragraph 9(C)(i)), exceeds ten percent
(10%) of the aggregate Fair Market Value of all shares of Common Stock
outstanding on the record date for determining the shareholders
entitled to receive such Extraordinary Distribution and/or (y) any
shares of capital stock of the Corporation (other than shares of
Common Stock), other securities of the Corporation, evidences of
indebtedness of the Corporation or any other person or any other
property (including shares of any subsidiary of the Corporation), or
any combination thereof. The Fair Market Value of an Extraordinary
Distribution for purposes of Section 9(C) shall be equal to the sum of
the Fair Market Value of such Extraordinary Distribution as of the
date made.
(iii) "Fair Market Value" shall mean, as to shares of
Common Stock or any other class of capital stock or securities of the
Corporation or any other issuer which are publicly traded, the average
of the "Current Market Prices" of such shares or such securities for
each day of the Adjustment Period. The "Fair Market Value" of any
security which is not publicly traded or of any other property shall
mean the fair value thereof as determined by an independent investment
banking or appraisal firm experienced in the valuation of such
securities or property selected in good faith by the Board of
Directors of the Corporation or a committee thereof (which may be the
independent appraiser engaged by any Plan) based on principles
consistently applied, or, if no such investment banking or appraisal
firm is in the good faith judgment of the Board of Directors or such
committee available to make such determination, as determined in good
faith by the Board of Directors of the Corporation or such committee.
(iv) "Current Market Price" of publicly traded shares
of Common Stock or any other class of capital stock or other security
of the Corporation or any other issuer for any day shall mean the last
reported sales price, regular way, or, in case no such reported sale
takes place on such day, the average of the reported closing bid and
asked prices, regular way, in either case as reported on the New York
Stock Exchange Composite Tape, or, if such security is not listed or
admitted to trading on such Exchange, on the principal national
securities exchange on which such security is listed or admitted to
trading, or if not listed or admitted to trading on any national
securities exchange, on the National Association of Securities Dealers
Automated Quotations National Market System, or, if such security is
not listed or admitted to trading on any national securities exchange
or quoted on such National Market System, the average of the closing
bid and asked prices in the over-the-counter market as furnished by
any New York Stock Exchange member firm selected from time to time by
the Board of Directors or a committee thereof for such purpose, in
each case, on each trading day during the Adjustment Period.
(v) "Adjustment Period" shall mean the period of five
(5) consecutive trading days preceding, and including, the date as of
which the Fair Market Value of a security is to be determined.
(vi) "Sec. 9(F) Non-Dilutive Amount" in respect of an
issuance, sale or exchange by the Corporation of any right or warrant
to purchase or acquire shares of Common Stock (including any security
convertible into or exchangeable for shares of Common Stock) shall
mean (x) the product of (I) the Fair Market Value of a share of Common
Stock on the trading day immediately preceding the first public
announcement of such issuance, sale or exchange and (II) the maximum
number of shares of Common Stock which could be acquired on such date
upon the exercise in full of such rights and warrants (including upon
the conversion or exchange of all such convertible or exchangeable
securities), whether or not exercisable (or convertible or
exchangeable) at such date, minus (y) the aggregate amount payable
pursuant to such right or warrant to purchase or acquire such maximum
number of shares of Common Stock; provided, however, that in no event
shall the Sec. 9(F) Non-Dilutive Amount be less than zero. For
purposes of the foregoing sentence, in the case of a security
convertible into or exchangeable for shares of Common Stock, the
amount payable pursuant to a right or warrant to purchase or acquire
shares of Common Stock shall be the Fair Market Value of such security
on the date of the issuance, sale or exchange of such security by the
Corporation.
(vii) "Pro Rata Repurchase" shall mean any purchase of
shares of Common Stock by the Corporation or any subsidiary thereof,
whether for cash, shares of capital stock of the Corporation, other
securities of the Corporation, evidences of indebtedness of the
Corporation or any other person or any other property (including
shares of a subsidiary of the Corporation), or any combination
thereof, effected while any of the shares of Series C Preferred Stock
are outstanding, pursuant to any tender offer or exchange offer
subject to Section 13(e) of the Exchange Act, or any successor
provision of law, or pursuant to any other offer available to
substantially all holders of Common Stock; provided, however, that no
purchase of shares by the Corporation or any subsidiary thereof made
in open market transactions shall be deemed a Pro Rata Repurchase.
For purposes of this paragraph 9(F)(vii), shares shall be deemed to
have been purchased by the Corporation or any subsidiary thereof "in
open market transactions" if they have been purchased substantially in
accordance with the requirements of Rule 10b-18 as in effect under the
Exchange Act, on the date shares of Series C Preferred Stock are
initially issued by the Corporation or on such other terms and
conditions as the Board of Directors of the Corporation or a committee
thereof shall have determined are reasonably designed to prevent such
purchases from having a material effect on the trading market for the
Common Stock.
(viii) "Valuation Date" with respect to an Extraordi-
nary Distribution shall mean the day immediately preceding (i) the ex-
dividend date for such Extraordinary Distribution with respect to a
security listed on a national securities exchange or (ii) the record
date for such Extraordinary Distribution with respect to a security
which is not listed on a national securities exchange.
Section 10. Retirement of Shares. Any shares of Series C
Preferred Stock acquired by the Corporation by reason of the
conversion or redemption of such shares as provided hereby, or
otherwise so acquired, shall be cancelled as shares of Series C
Preferred Stock and restored to the status of authorized but unissued
shares of Preferred Stock of the Corporation, undesignated as to
series, and may thereafter be reissued as part of a new series of
Preferred Stock as permitted by law.
Section 11. Miscellaneous.
(A) All notices referred to herein shall be in writing, and
all notices hereunder shall be deemed to have been given upon the
earlier of receipt thereof or three (3) Business Days after the
mailing thereof if sent by registered mail (unless first-class mail
shall be specifically permitted for such notice under the terms of
this Certificate of Designations) with postage prepaid, addressed: (i)
if to the Corporation, to its office at McDonald's Plaza, Oak Brook,
Illinois 60521 (Attention: Secretary) or to the transfer agent for the
Series C Preferred Stock, or other agent of the Corporation designated
as permitted by this Certificate or (ii) if to any holder of the
Series C Preferred Stock or Common Stock, as the case may be, to such
holder at the address of such holder as listed in the stock record
books of the Corporation (which may include the records of any
transfer agent for the Series C Preferred Stock or Common Stock, as
the case may be) or (iii) to such other address as the Corporation or
any such holder, as the case may be, shall have designated by notice
similarly given.
(B) In the event that, at any time as a result of an
adjustment made pursuant to Section 9 hereof, the holder of any share
of the Series C Preferred Stock upon surrendering such shares for
conversion shall become entitled to receive any shares or other
securities of the Corporation other than shares of Common Stock, the
Conversion Ratio in respect of such other shares or securities so
receivable upon conversion of shares of Series C Preferred Stock shall
thereafter be adjusted, and shall be subject to further adjustment
from time to time, in a manner and on terms as nearly equivalent as
practicable to the provisions with respect to Common Stock contained
in Section 9 hereof, and the provisions of each of the other Sections
hereof with respect to the Common Stock shall apply on like or similar
terms to any such other shares or securities.
(C) The Corporation shall pay any and all stock transfer
and documentary stamp taxes that may be payable in respect of any
issuance or delivery of shares of Series C Preferred Stock or shares
of Common Stock or other securities issued on account of Series C
Preferred Stock pursuant hereto or certificates representing such
shares or securities. The Corporation shall not, however, be required
to pay any such tax which may be payable in respect of any transfer
involved in the issuance or delivery of shares of Series C Preferred
Stock or Common Stock or other securities in a name other than that in
which the shares of Series C Preferred Stock with respect to which
such shares or other securities are issued or delivered were
registered, or in respect of any payment to any person with respect to
any such shares or securities other than a payment to the registered
holder thereof, and shall not be required to make any such issuance,
delivery or payment unless and until the person otherwise entitled to
such issuance, delivery or payment has paid to the Corporation the
amount of any such tax or has established, to the satisfaction of the
Corporation, that such tax has been paid or is not payable.
(D) In the event that a holder of shares of Series C
Preferred Stock shall not by written notice designate the name in
which shares of Common Stock to be issued upon conversion of such
shares should be registered or to whom payment upon redemption of
shares of Series C Preferred Stock should be made or the address to
which the certificate or certificates representing such shares, or
such payment, should be sent, the Corporation shall be entitled to
register such shares, and make such payment, in the name of the holder
of such Series C Preferred Stock as shown on the records of the
Corporation and to send the certificate or certificates representing
such shares, or such payment, to the address of such holder shown on
the records of the Corporation.
(E) Unless otherwise provided in this Certificate of
Designations, as the same may be amended, all payments in the form of
dividends, distributions on voluntary or involuntary dissolution,
liquidation or winding-up or otherwise made upon the shares of Series
C Preferred Stock and any other stock ranking on a parity with the
Series C Preferred Stock with respect to such dividend or distribution
shall be made pro rata, so that amounts paid per share on the Series C
Preferred Stock and such other stock shall in all cases bear to each
other the same ratio that the required dividends, distributions or
payments, as the case may be, then payable per share on the shares of
the Series C Preferred Stock and such other stock bear to each other.
(F) The Corporation may appoint, and from time to time
discharge and change, a transfer agent for the Series C Preferred
Stock. Upon any such appointment or discharge of a transfer agent,
the Corporation shall send notice thereof by first-class mail, postage
prepaid, to each holder of record of Series C Preferred Stock.
4. Series D Preferred Stock.
FURTHER RESOLVED, that pursuant to the authority granted to
and vested in the Board of Directors of this Corporation (hereinafter
called the "Board of Directors" or the "Board") in accordance with the
provisions of the Restated Certificate of Incorporation, the Board of
Directors hereby creates a series of Preferred Stock, without par
value (the "Preferred Stock"), of the Corporation and hereby states
the designation and number of shares, and fixes the relative rights,
preferences and limitations thereof as follows:
Series D Preferred Stock:
Section 1. Designation and Amount. The shares of such
series shall be designated as Series D Preferred Stock (the "Series D
Preferred Stock") and the number of shares constituting the Series D
Preferred Stock shall be three hundred thousand (300,000). Shares of
Series D Preferred Stock shall have a stated value of $100 per share.
Such number may be increased or decreased by resolution of the Board
of Directors; provided, however that no decrease shall reduce the
number of shares of Series D Preferred Stock to a number less than the
number of shares then outstanding plus the number of shares reserved
for issuance upon the exercise of outstanding options, rights or
warrants issued by or upon the conversion of any outstanding
securities issued by the Corporation convertible into Series D
Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of
any series of Preferred Stock (or any similar stock) ranking prior and
superior to the Series D Preferred Stock with respect to dividends,
the holders of shares of Series D Preferred Stock, in preference to
the holders of Common Stock and of any other Junior Stock (as
hereinafter defined in Section 4(B)), shall be entitled to receive a
cash dividend payable in an amount per share equal to $1.25 per
quarter and no more (such amount being referred to herein as the
"Dividend Amount"), which dividend shall be payable when and as
declared by the Board of Directors, out of funds legally available for
the purpose, payable quarterly in arrears on the first day of March,
June, September and December in each year (each such date being
referred to herein as "Dividend Payment Date"), subject to Section
2(B) below, commencing on the first Dividend Payment Date after the
first issuance of a share of Series D Preferred Stock. In the event
that any Dividend Payment Date shall occur on any day other than a
"Business Day" (as hereinafter defined), the dividend payment due on
such Dividend Payment Date shall be paid on the Business Day
immediately preceding such Dividend Payment Date. The Board of
Directors may fix a record date for the determination of holders of
shares of Series D Preferred Stock entitled to receive payment of a
dividend or distribution declared thereon, which record date shall be
not more than 60 days prior to the date fixed for the payment thereof.
For purposes of these resolutions, "Business Day" shall mean each day
that is not a Saturday, Sunday or a date on which federally or state
chartered banking institutions in Chicago, Illinois or New York, New
York are required or authorized to be closed.
(B) Dividends shall begin to accrue and be cumulative on
outstanding shares of Series D Preferred Stock from the date of issue
of such shares and shall accrue on a daily basis whether or not
declared and whether or not the Corporation shall have earnings or
surplus out of which such dividends could be paid at the time.
Dividends accrued on the shares of Series D Preferred Stock for any
period less than a full quarterly period between Dividend Payment
Dates shall be computed on the basis of a 360-day year of 30-day
months and in lieu of the initial quarterly dividend, such a
proportional dividend shall accrue for the period from the date of
issue until the first Dividend Payment Date after the issuance of any
such shares. Accrued but unpaid dividends shall not bear interest.
Accumulated but unpaid dividends shall cumulate as of the Dividend
Payment Date on which they first become payable, but no interest shall
accrue on accumulated but unpaid dividends.
(C) Dividends paid on the shares of Series D Preferred
Stock in an amount less than the total amount of such dividends at the
time accrued and payable on such shares shall be allocated pro rata on
a share-by-share basis among all such shares at the time outstanding.
Section 3. Voting Rights. The holders of shares of Series
D Preferred Stock shall have the following voting rights:
(A) Each share of Series D Preferred Stock shall entitle
the holder thereof to one vote on all matters submitted to a vote of
the stockholders of the Corporation.
(B) Except as otherwise provided by law or in the Restated
Certificate of Incorporation, the holders of shares of Series D
Preferred Stock and the holders of shares of Common Stock and any
other capital stock of the Corporation having general voting rights
shall vote together as one class on all matters submitted to a vote of
stockholders of the Corporation.
(C) Except as set forth herein, or as otherwise provided by
law or in the Restated Certificate of Incorporation, holders of
Series D 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 taking
any corporate action. Any increase or decrease in the authorized
class of Preferred Stock shall not be deemed to alter or change the
powers, preferences, or special rights of the shares of Series D
Preferred Stock so as to affect them adversely within the meaning of
the General Corporation Law of the State of Delaware and no class vote
shall be required to authorize such increase or decrease.
Section 4. Certain Restrictions.
(A) So long as any Series D Preferred Stock shall be
outstanding, no dividend shall be declared and paid or set apart for
payment on any other series of stock ranking on a parity with the
Series D Preferred Stock as to dividends ("Parity Stock"), unless
there shall also be or have been declared and paid or set apart for
payment on the Series D Preferred Stock dividends for all dividend
payment periods of the Series D Preferred Stock ending on or before
the dividend payment date of such Parity Stock, ratably in proportion
to the respective amounts of dividends on the Series D Preferred Stock
accumulated and unpaid through the most recent such dividend payment
period, and accumulated and unpaid on such Parity Stock through the
dividend payment period on such Parity Stock ending on such dividend
payment date or such dividend payment date immediately preceding such
dividend payment period.
(B) So long as any Series D Preferred Stock shall be
outstanding, in the event that full cumulative dividends on the Series
D Preferred Stock have not been declared and paid or set apart for
payment, the Corporation shall not declare and pay or set apart for
payment any dividends or make any other distributions on, or make any
payment on account of the purchase, redemption or other retirement of,
Common Stock or any other class of stock or series thereof of the
Corporation ranking, as to dividends or as to distributions in the
event of a liquidation, dissolution or winding up of the Corporation,
junior to the Series D Preferred Stock (collectively, "Junior Stock")
until full cumulative and unpaid dividends on the Series D Preferred
Stock shall have been paid or declared and set apart for payment;
provided, however, that the foregoing shall not apply to (i) any
dividend payable solely in any shares of Junior Stock, or (ii) the
acquisition of shares of Junior Stock either (x) pursuant to any
employee or director incentive or benefit plan or arrangement of the
Corporation or any subsidiary of the Corporation heretofore or
hereafter adopted or (y) in exchange solely for shares of any other
Junior Stock. Subject to the foregoing provisions of this Section 4,
the Board of Directors may declare and the Corporation may pay or set
apart for payment dividends and other distributions on any Junior
Stock or Parity Stock; and may purchase or otherwise redeem or retire
any of the Junior Stock or Parity Stock or any warrants, rights, or
options or other securities exercisable for or convertible into any of
the Junior Stock or Parity Stock and the holders of shares of the
Series D Preferred Stock shall not be entitled to share therein.
Section 5. Liquidation, Dissolution or Winding Up.
(A) Upon any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (i) to the holders of
shares of Junior Stock unless, prior thereto, the holders of shares of
Series D Preferred Stock shall have received $100 per share (such
amount being referred to herein as the "Liquidation Preference"), plus
an amount equal to accrued and unpaid dividends and distributions
thereon, whether or not declared, as to the date of such payment, or
(ii) to the holders of shares of Parity Stock, except distributions
made ratably on the Series D Preferred Stock and all such Parity Stock
in proportion to the total amounts to which the holders of all such
shares are entitled upon such liquidation, dissolution or winding up.
After payment of the full amount to which they are entitled as
provided by the foregoing provisions of this Section 5(A), the holders
of shares of Series D Preferred Stock shall not be entitled to any
further right or claim to any of the remaining assets of the
Corporation.
(B) Neither the merger or consolidation of the Corporation
with or into any other corporation or other entity, nor the merger or
consolidation of any other corporation or other entity with or into
the Corporation, nor the sale, transfer or lease of all or any portion
of the assets of the Corporation, shall be deemed to be a liquidation,
dissolution or winding up of the Corporation for purposes of this
Section 5.
(C) Written notice of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation, stating the
payment date or dates when, and the place or places where, the amounts
distributable to holders of Series D Preferred Stock in such
circumstances shall be payable, shall be made in accordance with
Section 8 below not less than 20 days prior to any payment date stated
therein, to the holders of Series D Preferred Stock, at their
respective addresses shown on the books of the Corporation or any
transfer agent for the Series D Preferred Stock; provided, however,
that a failure to give notice as provided herein or any defect therein
shall not affect the Corporation's ability to consummate a voluntary
or involuntary liquidation, dissolution or winding up of the
Corporation.
Section 6. Redemption.
All of the outstanding Series D Preferred Stock shall be
redeemed, by the Corporation, out of funds legally available therefor,
on the later of (i) February 1, 1997 and (ii) the death of Maurice J.
Sullivan, an individual residing in the State of Hawaii, to whom the
initial shares of Series D Preferred Stock will initially be issued
(the "Redemption Date"). The shares shall be redeemed at a price of
$100 per share, plus an amount equal to accrued and unpaid dividends
thereon, to the Redemption Date (the "Redemption Price"). On or
subsequent to the Redemption Date, upon surrender of the certificates
for any shares to be redeemed pursuant to the provisions of this
Section 6, the Redemption Price of such shares shall be paid in cash.
In the event that the Redemption Price is either paid or made
available for payment, then, notwithstanding that the certificate or
certificates evidencing any of the shares of the Series D Preferred
Stock shall not have been surrendered, all rights with respect to such
shares shall terminate, effective on the Redemption Date, and any such
certificate shall represent only the right to receive the Redemption
Price, without interest, upon surrender. No interest shall accrue on
the Redemption Price after the Redemption Date.
Section 7. Reacquired Shares. Any shares of Series D
Preferred Stock acquired by the Corporation by reason of the
redemption of such shares as provided hereby, or otherwise so
acquired, shall be retired and the Corporation shall take all actions
necessary to restore such shares to the status of authorized but
unissued shares of Preferred Stock, without par value, of the
Corporation, which shares may thereafter be reissued as part of a new
series of such Preferred Stock or as Series D Preferred Stock, as
permitted by law.
Section 8. Miscellaneous.
(A) All notices referred to herein shall be in writing, and
delivered personally, sent by courier, or by registered or certified
mail (postage prepaid, return receipt requested) addressed: (i) if to
the Corporation, to its office at McDonald's Plaza, Oak Brook,
Illinois 60521 (Attention: Secretary) or to the transfer agent
designated by the Corporation or (ii) if to any holder of the Series D
Preferred Stock, to such holder at the address of such holder as
listed in the stock records books of the Corporation (which may
include the records of any transfer agent for the Series D Preferred
Stock or Common Stock, as the case may be) or (iii) to such other
address as the Corporation or any such holder, as the case may be,
shall have designated by notice similarly given.
(B) The Corporation shall pay any and all stock transfer
and documentary stamp taxes that may be payable in respect of any
issuance or delivery or shares of Series D Preferred Stock or
certificates representing such shares. The Corporation shall not,
however, be required to pay any such tax which may be payable in
respect of any transfer involved in the issuance or delivery of shares
of Series D Preferred Stock in a name other than the name in which the
shares of Series D Preferred Stock with respect to which such shares
are issued or delivered were registered, or in respect of any payment
to any person with respect to any such shares other than a payment to
the registered holder thereof, and shall not be required to make any
such issuance, delivery or payment unless and until the person
otherwise entitled to such issuance, delivery or payment has paid to
the Corporation the amount of any such tax or has established, to the
satisfaction of the Corporation, that such tax has been paid or is not
payable.
(C) Unless otherwise provided in the Certificate of
Designations as the same may be amended, all payments in the form of
dividends, distributions on voluntary or involuntary dissolution,
liquidation or winding-up otherwise made upon the shares of Series D
Preferred Stock and any other stock ranking on a parity with the
Series D Preferred Stock with respect to such dividend or distribution
shall be made pro rata, so that amounts paid per share on the Series D
Preferred Stock and such other stock shall in all cases bear to each
other the same ratio that the required dividends, distributions or
payments, as the case may be, then payable per share on the shares of
the Series D Preferred Stock and such other stock bear to each other.
(D) The Corporation may appoint and from time to time
discharge and change, a transfer agent for the Series D Preferred
Stock. Upon any such appointment or discharge of a transfer agent,
the Corporation shall send notice thereof in accordance with Section
8(A) to each holder of record of Series D Preferred Stock.
5. Series E Preferred Stock.
RESOLVED, That the issuance of a series of Preferred Stock,
without par value, of the Corporation is hereby authorized and the
designations, preferences and privileges, relative, participating,
optional and other special rights and qualifications, limitations and
restrictions thereof, in addition to those set forth in the Restated
Certificate of Incorporation of the Corporation, are hereby fixed as
follows:
7.72% Cumulative Preferred Stock, Series E
Section 1. Designation and Amount. The shares of such
series shall be designated as 7.72% Cumulative Preferred Stock,
Series E (the "Series E Preferred Stock"), and the number of shares
constituting the Series E Preferred Stock shall be 10,000. Shares of
Series E Preferred Stock shall have a liquidation preference of
$50,000 per share. The number of shares may be increased or
decreased by resolution of the Board of Directors; provided, however,
that no decrease shall reduce the number of shares of Series E
Preferred Stock to a number less than the number of shares then
outstanding plus the number of shares reserved for issuance upon the
exercise of outstanding options, rights or warrants issued by or upon
the conversion of any outstanding securities issued by the
Corporation convertible into Series E Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of
any series of Preferred Stock (or any similar stock) ranking prior
and superior to Series E Preferred Stock with respect to dividends,
the holders of shares of Series E Preferred Stock, in preference to
the holders of Common Stock and of any other Junior Stock (as
hereinafter defined in Section 4(B)), shall be entitled to receive a
cash dividend payable in an amount per share equal to $965.00 per
quarter and no more (such amount being referred to herein as the
"Dividend Amount"), which dividend shall be payable when, as and if
declared by the Board of Directors, out of funds legally available
for that purpose, quarterly in arrears on the first day of March,
June, September and December in each year (each such date being
referred to herein as a "Dividend Payment Date"), commencing on March
1, 1993. In the event that any Dividend Payment Date shall occur on
any day other than a "Business Day" (as hereinafter defined), the
dividend payment due on such Dividend Payment Date shall be paid on
the Business Day immediately preceding such Dividend Payment Date.
The Board of Directors may fix a record date for the determination of
holders of shares of Series E Preferred Stock entitled to receive
payment of a dividend or distribution declared thereon, which record
date shall be not more than 60 days prior to the date fixed for the
payment thereof. For purposes of these resolutions, "Business Day"
shall mean each day that is not a Saturday, Sunday or a date on which
federally or state chartered banking institutions in Chicago,
Illinois or New York, New York are required or authorized to be
closed.
(B) Dividends shall begin to accrue on outstanding shares
of Series E Preferred Stock from the date of original issuance of
such shares and shall accrue on a daily basis whether or not declared
and whether or not the Corporation shall have earnings or surplus out
of which such dividends could be paid at the time. Dividends accrued
on the shares of Series E Preferred Stock for any period greater or
less than a full quarterly period between Dividend Payment Dates
shall be computed on the basis of a 360-day year of twelve 30-day
months. Accrued but unpaid dividends shall not bear interest.
Accrued but unpaid dividends shall cumulate as of the Dividend
Payment Date on which they first become payable, but no interest
shall accrue on such accumulated but unpaid dividends.
(C) Dividends paid on the shares of Series E Preferred
Stock in an amount less than the total amount of such dividends at
the time accrued and payable on such shares shall be allocated pro
rata on a share-by-share basis among all such shares at the time
outstanding.
Section 3. Voting Rights.
(A) Except as set forth herein, or as otherwise provided by
law or in the Restated Certificate of Incorporation, holders of Series
E Preferred Stock shall have no special voting rights and their
consent shall not be required for taking any corporate action. On
those matters where voting rights are conferred herein, by law or in
the Restated Certificate of Incorporation, each share of Series E
Preferred Stock shall entitle the voter thereof to one vote. Any
increase or decrease in the authorized class of Preferred Stock shall
not be deemed to alter or change the powers, preferences, or special
rights of the shares of Series E Preferred Stock so as to affect them
adversely within the meaning of the General Corporation Law of the
State of Delaware and no class vote shall be required to authorize
such increase or decrease.
(B) If at any time dividends payable on Series E Preferred
Stock, or on any one or more other series of Preferred Stock of the
Corporation entitled to receive cumulative preferred dividends, are
in arrears and unpaid in an amount equal to or exceeding the amount
of dividends payable on such Series E Preferred Stock and/or other
series of Preferred Stock entitled to receive cumulative dividends
for six quarterly dividend periods, whether or not consecutive, the
holders of all outstanding shares of Preferred Stock entitled to
receive cumulative preferred dividends will have the exclusive right,
voting separately as a class, to elect two directors to the Board of
Directors of the Corporation at the next annual meeting of
stockholders of the Corporation. The authorized number of Directors
shall not be increased for this purpose. Such voting right will
continue for such Preferred Stock until all dividends on Series E
Preferred Stock and on such other series have been paid in full, at
which time such voting right of the holders of such Preferred Stock
will terminate, subject to re-vesting in the event of a subsequent
arrearage. Upon any termination of the aforesaid voting right, the
term of office of those directors elected by holders of Preferred
Stock voting separately as a class will terminate.
Section 4. Certain Restrictions.
(A) So long as any Series E Preferred Stock shall be
outstanding, no dividend shall be declared and paid or set apart for
payment on any other series of stock ranking on a parity with Series
E Preferred Stock as to dividends ("Parity Stock"), unless there
shall also be or have been declared and paid or set apart for payment
on Series E Preferred Stock dividends for all dividend payment
periods of Series E Preferred Stock ending on or before the dividend
payment date of such Parity Stock, ratably in proportion to the
respective amounts of dividends on the Series E Preferred Stock
accrued and unpaid through the most recent such dividend payment
period, and accrued and unpaid on such Parity Stock through the
dividend payment period on such Parity Stock ending on such dividend
payment date or such dividend payment date immediately preceding such
dividend payment period.
(B) So long as any Series E Preferred Stock shall be
outstanding, in the event that full cumulative dividends on the
Series E Preferred Stock have not been declared and paid or set apart
for payment when due, the Corporation shall not declare and pay or
set apart for payment any dividends on Common Stock or any other
class of stock or series thereof of the Corporation ranking as to
dividends junior to Series E Preferred Stock (collectively, "Junior
Stock") until full cumulative and unpaid dividends on Series E
Preferred Stock shall have been paid or declared and set apart for
payment; provided, however, that the foregoing shall not apply to any
dividend payable solely in any shares of Junior Stock. Subject to
the foregoing provisions of this Section 4, the Board of Directors
may declare and the Corporation may pay or set apart for payment
dividends on any Junior Stock or Parity Stock and the holders of
shares of Series E Preferred Stock shall not be entitled to share
therein.
Section 5. Liquidation, Dissolution or Winding Up.
(A) Upon any liquidation, dissolution or winding up of the
Corporation, either voluntary or involuntary, no distribution shall
be made (i) to the holders of shares of stock ranking junior to the
Series E Preferred Stock as to distributions in the event of any
liquidation, dissolution or winding up of the Corporation unless,
prior thereto, the holders of shares of Series E Preferred Stock
shall have received $50,000 per share (such amount being referred to
herein as the "Liquidation Preference"), plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or
not declared, as to the date of such payment, or (ii) to the holders
of shares of stock ranking on a parity with the Series E Preferred
Stock as to distributions in the event of any liquidation,
dissolution or winding up of the Corporation ("Parity Liquidation
Stock"), except distributions made ratably on Series E Preferred
Stock and all such Parity Liquidation Stock in proportion to the
total amounts to which the holders of all such shares are entitled
upon such liquidation, dissolution or winding up. After payment of
the full amount to which they are entitled as provided by the
foregoing provisions of this Section 5(A), the holders of shares of
Series E Preferred Stock shall not be entitled to any further right
or claim to any of the remaining assets of the Corporation.
(B) Neither the merger or consolidation of the Corporation
with or into any other corporation or other entity, nor the merger or
consolidation of any other corporation or other entity with or into
the Corporation, nor the sale, lease, exchange or other transfer of
all or any portion of the assets of the Corporation, shall be deemed
to be a liquidation, dissolution or winding up of the Corporation for
purposes of this Section 5.
(C) Written notice of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation, stating
the payment date or dates when, and the place or places where, the
amounts distributable to holders of Series E Preferred Stock in such
circumstances shall be payable, shall be made in accordance with
Section 9 below not less than 20 days prior to any payment date
stated therein, to the holders of Series E Preferred Stock, at their
respective addresses shown on the books of the Corporation or any
transfer agent for the Series E Preferred Stock; provided, however,
that a failure to give notice as provided herein or any defect
therein shall not affect the Corporation's ability to consummate a
voluntary or involuntary liquidation, dissolution or winding up of
the Corporation.
Section 6. Redemption. The Series E Preferred Stock will
not be redeemable prior to December 3, 1997. The Series E Preferred
Stock will be redeemable, at the option of the Corporation, in whole
or in part, out of funds legally available therefor, at any time, on
or after December 3, 1997, upon not less than 30 nor more than 90
days' notice, at a redemption price per share of Series E Preferred
Stock equal to the Liquidation Preference, plus an amount equal to
accrued and unpaid dividends to the redemption date. On or
subsequent to the redemption date, upon surrender of the certificates
for any shares to be redeemed pursuant to the provisions of this
Section 6, the redemption price of such shares shall be paid in cash.
In the event that the redemption price is either paid or made
available for payment, then, notwithstanding that the certificate or
certificates evidencing any of the shares of the Series E Preferred
Stock shall not have been surrendered, all rights with respect to
such shares shall terminate, effective on the redemption date, and
any such certificate shall represent only the right to receive the
redemption price, without interest, upon surrender. No interest
shall accrue on the redemption price after the redemption date.
Section 7. Reacquired Shares. Any shares of Series E
Preferred Stock acquired by the Corporation by reason of the
redemption of such shares as provided hereby, or otherwise acquired,
shall be retired and the Corporation shall take all actions necessary
to restore such shares to the status of authorized but unissued
shares of Preferred Stock, without par value, of the Corporation,
which shares may thereafter be reissued as part of a new series of
such Preferred Stock or as Series E Preferred Stock, as permitted by
law.
Section 8. Ranking. The Series E Preferred Stock will
rank on a parity as to payment of dividends and distribution of
assets upon liquidation, dissolution or winding up, whether voluntary
or involuntary, of the Corporation with the Corporation's Series B
ESOP Convertible Preferred Stock, Series C ESOP Convertible Preferred
Stock and Series D Preferred Stock (which are the only series of
Preferred Stock currently outstanding) and prior to the Corporation's
Common Stock. The Series E Preferred Stock will rank prior to the
Corporation's Series A Junior Participating Preferred Stock (the
"Series A Preferred Stock") as to the payment of dividends and on a
parity with the Series A Preferred Stock as to distribution of assets
upon liquidation, dissolution or winding up, whether voluntary or
involuntary, if such Series A Preferred Stock is issued.
Section 9. Miscellaneous.
(A) All notices referred to herein shall be in writing,
and delivered personally, sent by courier, or by registered or
certified mail (postage prepaid, return receipt requested) addressed:
(i) if to the Corporation, to its office at One McDonald's Plaza, Oak
Brook, Illinois 60521 (Attention: Secretary) or to the transfer agent
designated by the Corporation or (ii) if to any holder of Series E
Preferred Stock, to such holder at the address of such holder as
listed in the stock record books of the Corporation or (iii) to such
other address as the Corporation or any such holder, as the case may
be, shall have designated by notice similarly given.
(B) The Corporation shall pay any and all stock transfer
and documentary stamp taxes that may be payable in respect of any
issuance or delivery of shares of Series E Preferred Stock or
certificates representing such shares. The Corporation shall not,
however, be required to pay any such tax which may be payable in
respect of any transfer involved in the issuance or delivery of
shares of Series E Preferred Stock in a name other than the name in
which such shares of Series E Preferred Stock were registered, or in
respect of any payment to any person with respect to any such shares
other than a payment to the registered holder thereof, and shall not
be required to make any such issuance, delivery or payment unless and
until the person otherwise entitled to such issuance, delivery or
payment has paid to the Corporation the amount of any such tax or has
established, to the satisfaction of the Corporation, that such tax
has been paid or is not payable.
(C) Unless otherwise provided in the Certificate of
Designations, Preferences and Rights, as the same may be amended, all
payments in the form of dividends, distributions on voluntary or
involuntary dissolution, liquidation or winding-up otherwise made
upon the shares of Series E Preferred Stock and any other stock
ranking on a parity with Series E Preferred Stock with respect to
such dividend or distribution shall be made pro rata, so that amounts
paid per share on Series E Preferred Stock and such other stock shall
in all cases bear to each other the same ratio that the required
dividends, distributions or payments, as the case may be, then
payable per share on the shares of the Series E Preferred Stock and
such other stock bear to each other.
(D) The Corporation may appoint, and from time to time
discharge and change, a transfer agent for Series E Preferred Stock.
Upon any such appointment or discharge of a transfer agent, the
Corporation shall send notice thereof in accordance with Section 9(A)
to each holder of record of Series E Preferred Stock.
FIFTH: The minimum amount of capital with which the
Corporation will commence business is One Thousand Dollars ($1,000).
SIXTH: The Corporation is to have perpetual existence.
SEVENTH: The private property of the stockholders of the
Corporation shall not be subject to the payment of corporate debts to
any extent whatsoever.
EIGHTH: In furtherance and not in limitation of the powers
conferred by the laws of the State of Delaware the Board of Directors
is expressly authorized and empowered:
(a) In the manner provided in the by-laws of the
Corporation to make, alter, amend and repeal the by-laws of the
Corporation in any respect not inconsistent with the laws of the State
of Delaware or with the Restated Certificate of Incorporation of the
Corporation;
(b) By a resolution or resolutions passed by a majority of
the whole Board, to designate one or more committees, each committee
to consist of two or more of the directors of the Corporation which,
to the extent provided in said resolution or resolutions or in the by-
laws of the Corporation, shall have and may exercise the powers of the
Board of Directors in the management of the business and affairs of
the Corporation, and may have power to authorize the seal of the
Corporation to be affixed to all papers which may require it. Such
committee or committees shall have such name or names as may be stated
in the by-laws of the Corporation or as may be determined from time to
time by resolution adopted by the Board of Directors;
(c) Subject to any applicable provisions of the by-laws of
the Corporation then in effect, to determine from time to time,
whether and to what extent and at what times and places and under what
conditions and regulations the accounts and books of the Corporation,
or any of them, shall be open to the inspection of the stockholders;
and no stockholder shall have any right to inspect any account or book
or document of the Corporation, except as conferred by the laws of the
State of Delaware, unless and until authorized so to do by resolution
of the Board of Directors or of the stockholders of the Corporation;
(d) To fix from time to time the amount of the surplus or
profits of the Corporation to be reserved as working capital or for
any other lawful purpose;
(e) Without any action by the stockholders, to authorize
the borrowing of moneys for any of the purposes of the Corporation
and, from time to time without limit as to amount, to authorize and
cause the making, execution, issuance, sale or other disposition of
promissory notes, drafts, bonds, debentures and other negotiable or
non-negotiable instruments and evidences of indebtedness, and the
securing of the same by mortgage, pledge, deed of trust or otherwise.
In addition to the powers and authorities hereinbefore or by
statute expressly conferred upon it, the Board of Directors may
exercise all such powers and do all such acts and things as may be
exercised, or done by the Corporation, subject, nevertheless, to the
provisions of the laws of the State of Delaware, this Restated
Certificate of Incorporation and the by-laws of the Corporation.
Any contract, transaction or act of the Corporation or of
the directors or of any committee, which shall be ratified by the
holders of a majority of the shares of stock of the Corporation
present in person or by proxy and voting at any annual meeting, or at
any special meeting called for such purpose, shall, insofar as
permitted by law or by this Restated Certificate of Incorporation, be
as valid and as binding as though ratified by every stockholder of the
Corporation.
The Corporation may enter into contracts or transact
business with one or more of its directors, or with any firm of which
one or more of its directors are members or with any trust, firm,
corporation or association in which any one or more of its directors
is a stockholder, director or officer or otherwise interested, and any
such contract or transaction shall not be invalidated in the absence
of fraud because such director or directors have or may have interests
therein which are or might be adverse to the interest of the
Corporation, even though the presence and/or vote of the director or
directors having such adverse interest shall have been necessary to
constitute a quorum and/or to obligate the Corporation upon such
contract or transaction, provided that such interests shall have been
disclosed to the other directors and a majority of the directors
voting shall have approved such contract or transaction; and no
director having such adverse interest shall be liable to this
Corporation or to any stockholder or creditor thereof, or to any other
person for any loss incurred by it under or by reason of any such
contract or transaction; nor shall any such director or directors be
accountable for any gains or profits realized thereon.
The Corporation shall have power to indemnify any and all of
its directors or officers or former directors or officers or any
person who may have served at its request as a director or officer of
another corporation in which it owns shares of capital stock or of
which it is a creditor against liabilities and expenses actually and
necessarily incurred by them in connection with the defense of any
action, suit or proceeding in which they, or any of them, are made
parties, or a party, by reason of being or having been directors or
officers or a director or officer of the Corporation, or of such other
corporation, except in relation to matters as to which any such
director or officer or former director or officer or person shall be
adjudged in such action, suit or proceeding to be liable for
negligence or misconduct in the performance of duty. Such
indemnification shall not be deemed exclusive of any other rights to
which those indemnified may be entitled, under any by-law, agreement,
vote of stockholders or otherwise.
NINTH: Meetings of stockholders may be held outside the
State of Delaware, if the by-laws so provide. The books of the
Corporation may be kept (subject to the laws of the State of Delaware)
outside the State of Delaware at such place or places as may be
designated from time to time by the Board of Directors or in the by-
laws of the Corporation. Elections of directors need not be by ballot
unless the by-laws of the Corporation shall so provide.
TENTH: The Corporation reserves the right to amend, alter,
change or repeal any provision contained in this Restated Certificate
of Incorporation, to the extent and in the manner now or hereafter
prescribed by statute, and all rights conferred upon stockholders
herein are granted subject to this reservation.
ELEVENTH: It is hereby declared to be a proper corporate
purpose, reasonably calculated to benefit stockholders, for the Board
of Directors to base the response of the Corporation to any
'Acquisition Proposal' on the Board of Directors' evaluation of what
is in the best interests of the Corporation and for the Board of
Directors, in evaluating what is in the best interests of the
Corporation, to consider:
(i) the best interest of the stockholders; for this
purpose the Board shall consider, among other factors, not only the
consideration being offered in the Acquisition Proposal, in relation
to the then current market price, but also in relation to the then
current value of the Corporation in a freely negotiated transaction
and in relation to the Board of Directors' then estimate of the future
value of the Corporation as an independent entity; and
(ii) such other factors as the Board of Directors deter-
mines to be relevant, including, among other factors, the social,
legal and economic effects upon franchisees, employees, suppliers,
customers and business.
"Acquisition Proposal" means any proposal of any person (a)
for a tender offer or exchange offer for any equity security of the
Corporation, (b) to merge or consolidate the Corporation with another
corporation, or (c) to purchase or otherwise acquire all or
substantially all of the properties and assets of the Corporation.
TWELFTH: Subject to all other applicable provisions of this
Restated Certificate of Incorporation and to all applicable provisions
of the law of Delaware, relating, inter alia, to stockholder approval,
the Board of Directors shall have the power to merge or consolidate
the Corporation with another corporation or to sell, lease or exchange
all or substantially all of the property and assets of the
Corporation, including its good will and its corporate franchises,
upon such terms and conditions and for such consideration, which may
be in whole or in part shares of stock in, and/or other securities of,
any corporation or corporations, as the Board of Directors shall deem
expedient and for the best interests of the Corporation, but,
regardless of any other provision of this Restated Certificate of
Incorporation, if any party to any such transaction shall be a person
or entity owning, immediately prior to the consummation of such
transaction, of record or beneficially, 2% or more of the stock of the
Corporation issued and outstanding having voting power, such power of
the Board of Directors shall be exercisable only when and as duly
authorized by the affirmative vote of the holders of not less than 66-
2/3% of the stock of the Corporation issued and outstanding having
voting power given at a stockholders' meeting duly called for that
purpose; provided, however, that the Board of Directors shall have the
power to merge the Corporation with another corporation without action
by the stockholders to the extent and in the manner permitted from
time to time by the law of Delaware. In determining whether or not
any person or entity (the 'Primary Holder') owns, of record or
beneficially, 2% or more of the stock of the Corporation issued and
outstanding having voting power, there shall be aggregated with all
shares of such stock owned of record or beneficially by the Primary
Holder (a) all shares of such stock owned of record or beneficially by
any person or entity who or which would be deemed to be controlling,
controlled by or under common control with the Primary Holder under
the Securities Act of 1933, as amended, the Securities Exchange Act of
1934, as amended, any federal statute enacted to take the place of
either or both such statutes or any regulation promulgated under
either of such statutes or such successor statutes (an 'Affiliate')
and (b) all shares of such stock owned of record or beneficially by
any person or entity acting in concert with the Primary Holder and/or
with an Affiliate of the Primary Holder. This Article Twelfth shall
not be altered, amended or repealed except by the affirmative vote of
the holders of not less than 66-2/3% of the stock of the Corporation
issued and outstanding having voting power, given at a stockholders'
meeting duly called for that purpose, upon a proposal adopted by the
Board of Directors.
THIRTEENTH: Board of Directors.
(a) Number, Election and Terms. The business and affairs
of the Corporation shall be managed by or under the direction of a
Board of Directors consisting of not less than 11 nor more than 24
persons. The exact number of directors within the minimum and maximum
limitations specified in the preceding sentence shall be fixed from
time to time by the Board of Directors pursuant to a resolution
adopted by a majority of the entire Board of Directors.
At the 1983 Annual Meeting of Stockholders, the directors
shall be divided into three classes, as nearly equal in number as
possible, with the term of office of the first class to expire at the
1984 annual meeting of stockholders, the term of office of the second
class to expire at the 1985 annual meeting of stockholders and the
term of office of the third class to expire at the 1986 annual meeting
of stockholders.
At each annual meeting of stockholders following such
initial classification and election, directors elected to succeed
those whose terms then expire shall be elected for a term of office
expiring at the third succeeding annual meeting of stockholders after
their election.
(b) Newly Created Directorships and Vacancies. Subject to
the rights of the holders of any series of Preferred Stock then
outstanding, newly created directorships resulting from any increase
in the authorized number of directors or any vacancies in the Board of
Directors resulting from death, resignation, retirement,
disqualification, removal from office or other cause shall be filled
by a majority vote of the directors then in office. Directors so
chosen shall hold office for a term expiring at the annual meeting of
stockholders at which the term of the class to which they have been
elected expires. No decrease in the number of directors constituting
the Board of Directors shall shorten the term of any incumbent
director.
(c) Removal. Subject to the rights of the holders of any
series of Preferred Stock then outstanding, any director, or the
entire Board of Directors, may be removed from office at any time, but
only for cause and only by the affirmative votes of the holders of at
least 80% of the voting power of all the shares of the Corporation
entitled to vote for the election of directors.
(d) Amendment, Repeal, Etc. Notwithstanding anything to
the contrary contained in this Restated Certificate of Incorporation,
the affirmative vote of the holders of at least 80% of the voting
power of all of the shares of the Corporation entitled to vote for the
election of directors shall be required to amend, alter or repeal, or
to adopt any provision inconsistent with, this Article Thirteenth.
FOURTEENTH: Stockholder Action. Any action required or
permitted to be taken by the stockholders of the Corporation must be
effected at a duly called annual or special meeting of stockholders of
the Corporation and may not be effected by any consent in writing by
such stockholders. Special meetings of stockholders of the
Corporation may be called upon not less than 10 nor more than 60 days'
written notice only by the Board of Directors pursuant to a resolution
approved by a majority of the Board of Directors. Notwithstanding
anything contained in this Restated Certificate of Incorporation to
the contrary, the affirmative vote of the holders of at least 80% of
the voting power of all of the shares of the Corporation entitled to
vote for the election of directors shall be required to amend, alter
or repeal, or to adopt any provision inconsistent with, this Article
Fourteenth.
FIFTEENTH: Elimination of Certain Liability of Directors.
To the fullest extent that the general corporate law of the State of
Delaware, as it exists on the date hereof or as it may hereafter be
amended, permits the limitation or elimination of the liability of
directors, no director of the Corporation shall be liable to the
Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director. No amendment to or repeal of this
Article Fifteenth shall apply to or have any effect on liability or
alleged liability of any director of the Corporation for or with
respect to any acts or omissions of such director occurring prior to
such amendment or repeal.
IN WITNESS WHEREOF, this Restated Certificate of
Incorporation, which restates and integrates but does not further
amend the Restated Certificate of Incorporation of
McDonald's Corporation, as heretofore amended or supplemented, there
being no discrepancy between such Restated Certificate of
Incorporation, as so amended and supplemented, and the provisions
hereof, and having been adopted in accordance with Section 245 of the
Delaware General Corporation Law, has been executed by its Senior Vice
President and attested by its Assistant Secretary, as of this 15th day
of November, 1994.
McDONALD'S CORPORATION
By: /s/ Shelby Yastrow
------------------------
Shelby Yastrow
Senior Vice President
ATTEST:
/s/ Gloria Santona
------------------------
Gloria Santona
Assistant Secretary