As amended December 12, 1997
BY-LAWS
OF
NEW ENGLAND POWER COMPANY
ARTICLE 1.
Classes of Capital Stock
The capital stock of the corporation shall consist of common
stock of the par value of $20 a share, and three classes of
preferred stock, 6% Cumulative Preferred Stock of the par value
of $100 a share, Dividend Series Preferred Stock of the par value
of $100 a share and Preferred Stock-Cumulative of the par value
of 425 a share, each having respective preferences, voting
rights, restrictions and qualifications as follows:
Section 1. 6% Cumulative Preferred Stock and Common
Stock. (Whenever in this Section 1 reference is made to
"preferred" or "preferred stock", it shall be deemed to be a
reference to the 6% Cumulative Preferred Stock unless expressly
provided otherwise.)
At every meeting of the stockholders every holder of shares
of stock, whether preferred or common, shall be entitled to one
vote either in person or by proxy for every such share registered
in his name. The holders of the preferred stock shall be
entitled to receive or to have set apart, out of the surplus or
net profits of the corporation, as and when declared by the board
of directors, a dividend at the rate of, but never exceeding, six
per centum per annum, cumulative, on all such preferred stock
outstanding at the time, which dividend shall be payable yearly,
half-yearly or quarterly as the board of directors may, from time
to time, fix and determine, and before any dividend shall be set
apart for or paid on the common stock. Whenever a dividend is
declared or paid on the preferred stock and all prior dividends
on the outstanding shares of such stock shall have been paid or
set apart, the board of directors may, if in its judgment, the
surplus or net profits, after deducting the amount of dividends
to accrue on the said outstanding preferred stock during the
current year, shall be sufficient for such purpose, then or
thereafter declare and pay dividends on the common stock payable
yearly, half-yearly or quarterly, and payable then or thereafter
out of any remaining surplus or net profits of the year then
current or last past and of any previous year in which full
dividends shall have been paid on the preferred stock. In case
of a liquidation or dissolution or winding up (whether voluntary
or involuntary) of the corporation, the holders of the preferred
stock shall receive cash to the amount of the par value of such
preferred stock, together with all accrued and unpaid dividends
thereon (but no more), before any payment is made to the holders
of the common stock, and the holders of the common stock shall be
solely entitled to the entire assets of the corporation or the
proceeds thereof, remaining after the payment in full, at its par
value, of the preferred stock then outstanding, together with all
dividends thereon accrued and unpaid. But dividends shall not
cumulate upon any preferred shares for any period during which
the same were not outstanding preferred shares of the
corporation. If the corporation at any time increases its
capital stock, and the new or additional shares are required by
law to be offered proportionately to its stockholders, the
holders of all classes of preferred stock only shall be entitle
to subscribe for new or additional preferred stock of any class
and the holders of common stock only shall be entitled to
subscribe for new or additional common stock and notice of such
increase as required by law need be given and the new shares need
be offered proportionately only to the stockholders who are so
entitled to subscribe.
Section 2. Dividend Series Preferred Stock.
A. The shares of Dividend Series Preferred Stock may be
issued, as the board of directors may determine, in one or more
series designated "Cumulative Preferred Stock, % Series" or,
with respect to issues subsequent to July 1, 1975, "Cumulative
Preferred Stock, $100 Par Value, % Series" (inserting in
each case the amount of the annual dividend rate, as determined
by the board of directors for each such series) or, with respect
to issues with an adjustable dividend rate, "Cumulative Preferred
Stock, $100 Par Value, Adjustable Rate Series "
(inserting in each case an appropriate designation, as determined
by the board of directors for each such series). All shares of
Dividend Series Preferred Stock, irrespective of series, shall
constitute one and the same class of stock and shall be of equal
rank as to dividends and assets with each other and with the 6%
Cumulative Preferred Stock and the Preferred Stock-Cumulative.
The shares of Dividend Series Preferred Stock of different
series, subject to any applicable provisions of law, may vary, as
the board of directors may determine, as to the following rights
and preferences:
(1) the dividend rate, or method of calculation
thereof, and the date from which the dividends on shares
issued prior to the record date for the first dividend shall
be cumulative and the date for the first dividend;
(2) the redemption price or prices, or method of
calculation thereof, and any restriction on the exercise by
the corporation of its right to redeem such series;
(3) the amount or amounts payable upon any liquidation
or dissolution or winding up.
(4) the terms and amount of any sinking fund provided
for the purchase or redemption of shares; and
(5) the conversion, participation or other special
rights.
B. Before any dividends on, or any distribution of assets
(by purchase of shares or otherwise) to holders of, the Common
Stock or any other stock ranking junior to the Dividend Series
Preferred Stock as to dividends (both hereinafter called "junior
stock") shall be paid or set apart for payment or otherwise
provided, the holders of the Dividend Series Preferred Stock
shall be entitled to receive, but only when and as declared by
the board of directors, out of any funds legally available for
the declaration of dividends, cumulative dividends at the annual
dividend rate per share fixed for the particular series payable
quarterly on the first days of January, April, July and October
in each year commencing on a date specified for the first
dividend date as herein provided to stockholders of record on the
respective dates, not exceeding forty-five (45) days preceding
such dividend payment dates fixed in advance for the purpose by
the board of directors prior to the payment of each particular
dividend. No dividends shall be declared on any series of the
Dividend Series Preferred Stock or of any other class of
preferred stock ranking on a parity therewith, as to dividends,
in respect of any quarter-yearly dividend period, unless there
shall likewise be declared on all shares of all series of the
Dividend Series Preferred Stock and of any other class of such
parity preferred stock at the time outstanding, like
proportionate dividends, ratably, in proportion to the respective
annual dividend rates fixed therefor, in respect of the same
quarter-yearly dividend period, to the extent that such share are
entitled to receive dividends for such quarter-yearly dividend
period. The dividends on shares of all series of the Dividend
Series Preferred Stock shall be cumulative. In the case of all
shares of each particular series, the dividends on shares of such
series shall be cumulative:
(1) on shares issued prior to the record date for the
first dividend on the shares of such series, from the date
for the particular series fixed therefor;
(2) on shares issued after a record date for a
dividend, but prior to the dividend payment date for such
dividend, from said dividend payment date; and
(3) otherwise from the quarter-yearly dividend payment
date next preceding the date of issue of such shares;
so that dividends accrued on all outstanding shares of Dividend
Series Preferred Stock to the last preceding quarterly dividend
payment date shall have been paid in full or declared and set
apart for payment before there shall be any distribution on, or
purchase of, junior stock. The holders of the Dividend Series
Preferred Stock shall not be entitled to receive any dividends
thereon other than the dividends referred to in this subsection B
and other than distributions provided in subsection D below. As
used in this Section 2, the expression "dividends accrued" shall
mean the sum of amounts with respect to all shares of Dividend
Series Preferred Stock then outstanding, which as to each share
shall be an amount computed at the rate per annum of the par
value thereof fixed for the particular series from the date from
which dividends on such share become cumulative to the date with
reference to which the expression is used, irrespective of
whether such amount shall have been declared as dividends or
there shall have existed any funds legally available for the
payment thereof, less the aggregate of all dividends paid or
declared payable on or before said last mentioned date and set
aside for such payment on such share.
(1) on shares issued prior to the record date for the
first dividend on the shares of such series, from the date
for the particular series fixed therefor;
(2) on share issued after a record date for a dividend,
but prior to the dividend payment date for such dividend,
from said dividend payment date; and
(3) otherwise from the quarter-yearly dividend payment
date next preceding the date of issue of such shares;
so that dividends accrued on all outstanding shares of Dividend
Series Preferred Stock to the last preceding quarterly dividend
payment date shall have been paid in full or declared and set
apart for payment before there shall be any distribution on, or
purchase of, junior stock. The holders of the Dividend Series
Preferred Stock shall not be entitled to receive any dividends
thereon other than the dividends referred to in this subsection B
and other than distributions provided in subsection D below. As
used in this Section 2, the expression "dividends accrued" shall
mean the sum of amounts with respect to all shares of Dividend
Series Preferred Stock then outstanding, which as to each share
shall be an amount computed at the rate per annum of the par
value thereof fixed for the particular series from the date from
which dividends on such share become cumulative to the date with
reference to which the expression is used, irrespective of
whether such amount shall have been declared as dividends or
there shall have existed any funds legally available for the
payment thereof, less the aggregate of all dividends paid or
declared payable on or before said last mentioned date and set
aside for such payment on such share.
C. The corporation, pursuant to action of its board of
directors or as provided in subsection A(8) of Section 4 of this
Article I, may redeem the whole or any part of the series of the
Dividend Series Preferred Stock at the time outstanding, at any
time or from time to time, by paying in cash as herein provided
the redemption price of the shares of the particular series fixed
therefor, together with dividends accrued to the date fixed for
such redemption, and by mailing, postage prepaid, at least thirty
(30) days and not more than ninety (90) days prior to the date
fixed for said redemption a notice specifying said redemption
date to the holders of record of the Dividend Series Preferred
Stock to be redeemed, at their respective addresses as the same
shall appear on the books of the corporation; provided, however,
that the exercise by the corporation of its right to redeem
shares of any particular series may be subject to such
restrictions as are determined for said series. In case of the
redemption of a part only of any series of the Dividend Series
Preferred Stock at the time outstanding, the corporation shall
select by lot in such manner as the board of directors
determines, the shares so to be redeemed. If such notice of
redemption shall have been so mailed, and if on or before the
redemption date specified in such notice all funds necessary for
such redemption shall have been set aside by the corporation, so
as to be and continue to be available therefor, then, on and
after said redemption date, notwithstanding that any certificate
for the shares of the Dividend Series Preferred Stock so called
for redemption shall not have been surrendered for cancellation,
the shares represented thereby shall no longer be deemed
outstanding, the right to receive dividends thereon shall cease
to accrue, and all rights of the holders thereof shall forthwith
cease and terminate, except only the right of the holders thereof
to receive the amount payable upon redemption thereof, but
without interest; provided, however, that if, after mailing said
notice as aforesaid and prior to the date of redemption specified
in such notice, said funds shall be set aside by deposit in
trust, for the account of the holders of the Dividend Series
Preferred Stock to be redeemed, with a bank or trust company in
good standing, organized under the laws of the United States of
America or of The Commonwealth of Massachusetts, having a
capital, undivided profits and surplus aggregating at least
$5,000,000, thereupon all shares of the Dividend Series Preferred
Stock with respect to which such deposit shall have been made
shall no longer be deemed to be outstanding, and all rights with
respect to such shares of Dividend Series Preferred Stock shall
forthwith upon such deposit in trusts cease and terminate, except
only the right of the holders thereof to receive from such
deposit the amount payable upon the redemption but without
interest. In case the holders of the Dividend Series Preferred
Stock which shall have been redeemed shall not within four years
of the date of redemption thereof claim any amount so deposited
in trust for the redemption of such shares, such bank or trust
company shall, upon demand, pay over to the corporation any such
unclaimed amount so deposited with it and shall thereupon be
relieved of all responsibility in respect thereof, and the
corporation shall not be required to hold the amount so paid over
to it separate and apart from its other funds, and thereafter the
holders of such shares of Dividend Series Preferred Stock shall
look only to the corporation for payment of the redemption price
thereof, but without interest. If there are any dividends
accrued to the last preceding quarterly dividend payment date or
dates on the outstanding Dividend Series Preferred Stock or any
other class of preferred stock ranking on a parity therewith as
to assets (both of which are hereinafter in this sentence
collectively referred to as "Preferred Stock"), (i) no Preferred
Stock which is redeemable shall be redeemed, unless all such
Preferred Stock shall be redeemed and unless an offer is made (a)
to purchase all Preferred Stock of any series which is not
redeemable at the time under limited restrictions then applicable
thereto at a price equal to the then redemption price for such
series if such restrictions were not applicable and (b) to
purchase all Preferred Stock which is not redeemable at the time
at a price equivalent to the highest then redemption price on any
outstanding shares of Preferred Stock, after giving effect to the
differences in par value among classes of Preferred Stock, and
(ii) no Preferred Stock shall be purchased, unless an offer is
made to purchase all Preferred Stock for which redemption prices
applicable at the time have been established (whether or not
there is then any applicable restriction on the redemption
thereof) at the same percentage (not in excess of one hundred per
centum (100%)) of the then applicable redemption price of each
series of said stock and unless an offer is made to purchase all
Preferred Stock for which redemption prices applicable at the
time have not been established at the same percentage of a price
equal to the then highest redemption price for any of said stock
for which a redemption price applicable at the time has been
established. All stock redeemed or purchased under the
provisions of this subsection C shall be retired.
D. In the event of any liquidation, dissolution or winding
up (whether voluntary or involuntary) of the affairs of the
corporation or any distribution of its capital, then before any
distribution shall be made to the holders of stock ranking junior
to the Dividend Series Preferred Stock as to assets, the holders
of each series of the Dividend Series Preferred Stock at the time
outstanding shall be entitled to be paid in cash the amount for
the particular series fixed therefor, together in each case with
dividends accrued thereon to the date fixed for payment of such
distributive amounts, and no more. No payments on account of
such distributive amounts shall be made to the holders of any
series of the Dividend Series Preferred Stock or of any other
class of preferred stock ranking on a parity therewith, as to
assets, unless there shall likewise be paid at the same time to
the holders of each other series of the Dividend Series Preferred
Stock and of such parity preferred stock at the time outstanding
like proportionate distributive amounts, ratably, in proportion
to the full distributive amounts to which they are respectively
entitled. After such payment to the holders of Dividend Series
Preferred Stock, the remaining assets and funds of the
corporation shall be divided and distributed among the holders of
junior stock then outstanding according to the respective rights.
Neither the consolidation nor the merger of the corporation with
or into any other corporation shall be deemed to be a
liquidation, dissolution or winding up of the corporation.
E. The holders of Dividend Series Preferred Stock shall
have no right to vote except as provided by law and except as
hereafter specifically provided in Section 4 of this Article I.
F. Except as otherwise expressly provided by law, no
holder of Dividend Series Preferred Stock shall be entitled as
such as a matter of right to subscribe for or purchase any part
of any new or additional issue of stock or warrants carrying
rights to stock, or securities convertible into stock, of any
class whatever, whether now or hereafter authorized, and whether
issued for cash, property, services or otherwise. If it is
expressly required by law that such new or additional issue be
offered proportionately to the stockholders, the holders of all
classes of preferred stock only shall be entitled to subscribe
for new or additional preferred stock of any class and the
holders of common stock only shall be entitled to subscribe for
new or additional common stock; and notice of such increase as
required by law need be given and the new shares need be offered
proportionately only to the stockholders who are so entitled to
subscribe.
G. Subject to the limitations, if any, contained in
Sections 4 and 5 of this Article I, the corporation may from time
to time issue additional capital stock divided into classes with
such preferences as to dividends, voting power and other
incidents as may be determined in accordance with applicable
provisions of law and terms of outstanding capital stock.
Without limiting the generality of the foregoing, any such
additional capital stock may be an additional series of Dividend
Series Preferred Stock or additional shares of the initial or any
other series of Dividend Series Preferred Stock.
H. So long as any shares of the Dividend Series Preferred
Stock of any series are outstanding, the payment of dividends on
stock of the corporation ranking junior to the Dividend Series
Preferred Stock as to dividends or assets (other than (i)
dividends payable in stock ranking junior to the Dividend Series
Preferred Stock as to dividends and assets or (ii) dividends paid
in cash if immediately thereafter there shall be paid to the
corporation in cash an amount equal to such dividends for shares
of or as a capital contribution with respect to stock ranking
junior to the Dividend Series Preferred Stock as to dividends or
assets) and the making of any distribution of assets to holders
of stock ranking junior to the Dividend Series Preferred Stock as
to dividends or assets by purchase of shares or otherwise (each
of such actions being herein embraced within the term "payment of
junior stock dividends") shall be subject to the following
limitations:
(1) if and so long as the junior stock equity is less
than twenty per cent (20%) of total capitalization, the
payment of junior stock dividends, including the proposed
payment, during the twelve months ending with and including
the date on which the proposed payment is to be made shall
not exceed fifty per cent (50%) of the net income of the
corporation available for the payment of dividends on the
stock ranking junior to the Dividend Series Preferred Stock
as to dividends and assets for the twelve full calendar
months immediately preceding the calendar month in which
such dividend is declared;
(2) if and so long as the junior stock equity is less
than twenty-five per cent (25%) but is twenty per cent (20%)
or more of total capitalization, the payment of junior stock
dividends, including the proposed payment, during the twelve
months ending with and including the date on which the
proposed payment is to be made shall not exceed seventy-five
per cent (75%) of the net income of the corporation
available for the payment of dividends on the stock ranking
junior to the Dividend Series Preferred Stock as to
dividends and assets for the twelve full calendar months
immediately preceding the calendar month in which such
dividend is declared; and
(3) except to the extent permitted under subsections
(1) and (2) above, the corporation shall not make any
payment of junior stock dividends which would reduce the
junior stock equity to less than twenty-five per cent (25%)
of total capitalization.
For the purposes of this subsection H "net income" shall be
determined in accordance with sound accounting practice, less the
excess, if any, of the largest minimum depreciation requirement
for the period of any mortgage indenture to which the corporation
is a party during such period over the amount charged by the
corporation on its books for depreciation during such period.
The term "junior stock equity" is defined in subsection
E(2)(i) of Section 4 of this Article I.
The term "total capitalization" as used in this subsection H
means the aggregate of (x) the junior stock equity, (y) the par
value of, or stated capital represented by, the outstanding
shares of Dividend Series Preferred Stock and any other stock
ranking prior thereto or on a parity therewith as to dividends or
assets and the premium thereon, and (z) the principal amount of
all outstanding indebtedness of the corporation represented by
bonds, notes and other evidences of indebtedness maturing by
their terms more than one year from the date of issue thereof.
I. No stockholder, director, officer or agent of the
corporation shall be held individually responsible for any action
taken in good faith though subsequently adjudged to be in
violation of this Section 2.
J. The shares of Dividend Series Preferred Stock from time
to time duly authorized may be issued for such consideration as
may be fixed from time to time either by the board of directors
or otherwise, as provided by law. Any and all shares of Dividend
Series Preferred Stock upon receipt by the corporation of the
consideration so fixed shall be deemed fully paid stock and shall
not be liable to any further call or assessment thereon.
K. Every holder of Dividend Series Preferred Stock of the
corporation by becoming such shall be held to have consented to
all of these provisions and to have agreed to be bound thereby
and to have waived to the full extent permitted by law any right
such holder may have either now or at any time in the future
contrary to these provisions.
Section 3. Preferred Stock-Cumulative.
A. The shares of Preferred Stock-Cumulative may be issued,
as the board of directors may determine, in one or more series
designated "Cumulative Preferred Stock, $25 Par Value,
% Series" (inserting in each case the amount of the annual
dividend rate, as determined by the board of directors for each
such series) or, with respect to issues with an adjustable
dividend rate, "Cumulative Preferred Stock, $100 Par Value,
Adjustable Rate Series "(inserting in each case an
appropriate designation, as determined by the board of directors
for each such series). All shares of Preferred Stock-Cumulative,
irrespective of series, shall constitute one and the same class
of stock and shall be of equal rank as to dividends and assets
with each other and with the 6% Cumulative Preferred Stock and
the Dividend Series Preferred Stock. The shares of Preferred
Stock-Cumulative of different series, subject to any applicable
provisions of law, may vary, as the board of directors may
determine, as to the following rights and preferences:
(1) the dividend rate, or method of calculation
thereof, and the date from which the dividends on shares
issued prior to the record date for the first dividend shall
be cumulative and the date for the first dividend;
(2) the redemption price or prices, or method of
calculation thereof, and any restriction on the exercise by
the corporation of its right to redeem such series;
(3) the amount or amounts payable upon any liquidation
or dissolution or winding up;
(4) the terms and amount of any sinking fund provided
for the purchase or redemption of shares; and
(5) the conversion, participation or other special
rights.
B. Before any dividends on, or any distribution of assets
(by purchase of shares or otherwise) to holders of, the Common
Stock or any other stock ranking junior to the Preferred Stock-
Cumulative as to dividends (both hereinafter called "junior
stock") shall be paid or set apart for payment or otherwise
provided, the holders of the Preferred Stock-Cumulative shall be
entitled to receive, but only when and as declared by the board
of directors, out of any funds legally available for the
declaration of dividends, cumulative dividends at the annual
dividend rate per share fixed for the particular series payable
quarterly on the first days of January, April, July and October
in each year commencing on a date specified for the first
dividend date as herein provided to stockholders of record on the
respective dates, not exceeding forty-five (45) days preceding
such dividend payment dates fixed in advance for the purpose by
the board of directors prior to the payment of each particular
dividend. No dividends shall be declared on any series of the
Preferred Stock-Cumulative or of any other class of preferred
stock ranking on a parity therewith, as to dividends, in respect
of any quarter-yearly dividend period, unless there shall
likewise be declared on all shares of all series of the Preferred
Stock-Cumulative and of any other class of such parity preferred
stock at the time outstanding, like proportionate dividends,
ratably, in proportion to the respective annual dividend rates
fixed therefor, in respect of the same quarter-yearly dividend
period, to the extent that such shares are entitled to receive
dividends for such quarter-yearly dividend period. The dividends
on shares of all series of the Preferred Stock-Cumulative shall
be cumulative. In the daze of all shares of each particular
series, the dividends on shares of such series shall be
cumulative.
(1) on shares issued prior to the record date for the
first dividend on the shares of such series, from the date
for the particular series fixed therefor;
(2) on shares issued after a record date for a
dividend, but prior to the dividend payment date for such
dividend, from said dividend payment date; and
(3) otherwise from the quarter-yearly dividend payment
date next preceding the date of issue of such shares;
so that dividends accrued on all outstanding shares of Preferred
Stock-Cumulative to the last preceding quarterly dividend payment
date shall have been paid in full or declared and set apart for
payment before there shall be any distribution on, or purchase
of, junior stock. The holders of the Preferred Stock-Cumulative
shall not be entitled to receive any dividends thereon other than
the dividends referred to in this subsection B and other than
distributions provided in subsection D below. As used in this
Section 3, the expression "dividends accrued" shall mean the sum
of amounts with respect to all shares of Preferred Stock-
Cumulative then outstanding, which as to each share shall be an
amount computed at the rate per annum of the par value thereof
fixed for the particular series from the date from which
dividends on such share become cumulative to the date with
reference to which the expression is used, irrespective of
whether such amount shall have been declared as dividends or thee
shall have existed any funds legally available for the payment
thereof, less the aggregate of all dividends paid or declared
payable on or before said last mentioned date and set aside for
such payment on such share.
C. The corporation, pursuant to action of its board of
directors or as provided in subsection A(8) of Section 4 of this
Article I, may redeem the whole or any part of any series of the
Preferred Stock-Cumulative at the time outstanding; at any time
or from time to time, by paying in cash as herein provided the
redemption price of the shares of the particular series fixed
therefor, together with dividends accrued to the date fixed for
such redemption, and by mailing, postage prepaid, at least thirty
(30) days and not more than ninety (90) days prior to the date
fixed for said redemption a notice specifying said redemption
date to the holders of record of the Preferred Stock-Cumulative
to be redeemed, at their respective addresses as the same shall
appear on the books of the corporation; provided, however, that
the exercise by the corporation of its right to redeem shares of
any particular series may be subject to such restrictions as are
determined for said series. In case of the redemption of a part
only of any series of the Preferred Stock-Cumulative at the time
outstanding, the corporation shall select by lot in such manner
as the board of directors determines, the shares so to be
redeemed. If such notice of redemption shall have been so
mailed, and if on or before the redemption date specified in such
notice all funds necessary for such redemption shall have been
set aside by the corporation, so as to be and continue to be
available therefor, then, on and after said redemption date,
notwithstanding that any certificate for the shares of the
Preferred Stock-Cumulative so called for redemption shall not
have been surrendered for cancellation, the shares represented
thereby shall no longer be deemed outstanding, the right to
receive dividends thereon shall cease to accrue, and all rights
of the holders thereof shall forthwith cease and terminate,
except only the right of the holders thereof to receive the
amount payable upon redemption thereof, but without interest;
provided, however, that if, after mailing said notice as
aforesaid and prior to the date of redemption specified in such
notice, said funds shall be set aside by deposit in trust, for
the account of the holders of the Preferred Stock-Cumulative to
be redeemed, with a bank or trust company in good standing,
organized under the laws of the United States of America or of
The Commonwealth of Massachusetts, having a capital, undivided
profits and surplus aggregating at least $5,000,000, thereupon
all shares of the Preferred Stock-Cumulative with respect to
which such deposit shall have been made shall no longer be deemed
to be outstanding, and all rights with respect to such shares of
Preferred Stock-Cumulative shall forthwith upon such deposit in
trust cease and terminate, except only the right of the holders
thereof to receive from such deposit the amount payable upon the
redemption but without interest. In case the holders of the
Preferred Stock-Cumulative which shall have been redeemed shall
not within four years of the date of redemption thereof claim any
amount so deposited in trust for the redemption of such shares,
such bank or trust company shall, upon demand, pay over to the
corporation any such unclaimed amount so deposited with it and
shall thereupon be relieved of all responsibility in respect
thereof, and the corporation shall not be required to hold the
amount so paid over to it separate and apart from its other
funds, and thereafter the holders of such shares of Preferred
Stock-Cumulative shall look only to the corporation for payment
of the redemption price thereof, but without interest. If there
are any dividends accrued to the last preceding quarterly
dividend payment date or dates on the outstanding Preferred
Stock-Cumulative or any other class of preferred stock ranking on
a parity therewith as to assets (both of which are hereinafter in
this sentence collectively referred to as "Preferred Stock"), (i)
no Preferred Stock which is redeemable shall be redeemed, unless
all such Preferred Stock shall be redeemed and unless an offer is
made (a) to purchase all Preferred Stock of any series which is
not redeemable at the time under limited restrictions then
applicable thereto at a price equal to the then redemption price
for such series if such restrictions wee not applicable and (b)
to purchase all Preferred Stock which is not redeemable at the
time at a price equivalent to the highest then redemption price
on any outstanding shares of Preferred Stock, after giving effect
to the differences in par value among classes of Preferred Stock,
and (ii) no Preferred Stock shall be purchased, unless an offer
is made to purchase all Preferred Stock for which redemption
prices applicable at the time have been established (whether or
not there is then any applicable restriction on the redemption
thereof) at the same percentage (not in excess of one hundred per
centum (100%)) of the then applicable redemption price for each
series of said stock and unless an offer is made to purchase all
Preferred Stock for which redemption prices applicable at the
time have not been established at the same percentage of a price
equal to the then highest redemption price for any of said stock
for which a redemption price applicable at the time has been
established. All stock redeemed or purchased under the
provisions of this subsection C shall be retired.
D. In the event of any liquidation, dissolution or winding
up (whether voluntary or involuntary) of the affairs of the
corporation or any distribution of its capital, then before any
distribution shall be made to the holders of stock ranking junior
to the Preferred Stock-Cumulative as to assets, the holders of
each series of the Preferred Stock-Cumulative at the time
outstanding shall be entitled to be paid in cash the amount for
the particular series fixed therefor, together in each case with
dividends accrued thereon to the date fixed for payment of such
distributive amounts, and no more. No payments on account of
such distributive amounts shall be made to the holders of any
series of the Preferred Stock-Cumulative or of any other class of
preferred stock ranking on a parity therewith, as to assets,
unless there shall likewise be paid at the same time to the
holders of each other series of the Preferred Stock-Cumulative
and of such parity preferred stock at the time outstanding like
proportionate distributive amounts, ratably, in proportion to the
full distributive amounts to which they are respectively
entitled. After such payment to the holders of Preferred Stock-
Cumulative, the remaining assets and funds of the corporation
shall be divided and distributed among the holders of junior
stock then outstanding according to the respective rights.
Neither the consolidation nor the merger of the corporation with
or into any other corporation shall be deemed to be a
liquidation, dissolution or winding up of the corporation.
E. The holders of Preferred Stock-Cumulative shall have no
right to vote except as provided by law and except as hereafter
specifically provided in Section 4 of this Article I.
F. Except as otherwise expressly provided by law, no
holder of Preferred Stock-Cumulative shall be entitled as such as
a matter of right to subscribe for or purchase any part of any
new or additional issue of stock or warrants carrying rights to
stock, or securities convertible into stock, of any class
whatever, whether now or hereafter authorized, and whether issued
for cash, property, services or otherwise. If it is expressly
required by law that such new or additional issue be offered
proportionately to the stockholders, the holders of all classes
of preferred stock only shall be entitled to subscribe for new or
additional preferred stock of any class and the holders of common
stock only shall be entitled to subscribe for new or additional
common stock; and notice of such increase as required by law need
be given and the new shares need be offered proportionately only
to the stockholders who are so entitled to subscribe.
G. Subject to the limitations, if any, contained in
Sections 4 and 5 of this Article I, the corporation may from time
to time issue additional capital stock divided into classes with
such preferences as to dividends, voting power and other
incidents as may be determined in accordance with applicable
provisions of law and terms of outstanding capital stock.
Without limiting the generality of the foregoing, any such
capital stock may be an additional series of Preferred Stock-
Cumulative or additional shares of the initial or any other
series of Preferred Stock-Cumulative.
H. So long as any shares of the Preferred Stock-Cumulative
of any series are outstanding, the payment of dividends on stock
of the corporation ranking junior to the Preferred Stock-
Cumulative as to dividends or assets (other than (i) dividends
payable in stock ranking junior to the Preferred Stock-Cumulative
as to dividends and assets or (ii) dividends paid in cash if
immediately thereafter there shall be paid to the corporation in
cash an amount equal to such dividends for shares of or as a
capital contribution with respect to stock ranking junior to the
Preferred Stock-Cumulative as to dividends or assets) and the
making of any distribution of assets to holders of stock ranking
junior to the Preferred Stock-Cumulative as to dividends or
assets by purchase of shares or otherwise (each of such actions
being herein embraced within the term "payment of junior stock
dividends") shall be subject to the following limitations:
(1) if and so long as the junior stock equity is less
than twenty per cent (20%) of total capitalization, the
payment of junior stock dividends, including the proposed
payment, during the twelve months ending with and including
the date on which the proposed payment is to be made shall
not exceed fifty per cent (50%) of the net income of the
corporation available for the payment of dividends on the
stock ranking junior to the Preferred Stock-Cumulative as to
dividends and assets for the twelve full calendar months
immediately preceding the calendar month in which such
dividend is declared:
(2) if and so long as the junior stock equity is less
than twenty-five per cent (25%) but is twenty per cent (20%)
or more of total capitalization, the payment of junior stock
dividends, including the proposed payment, during the twelve
months ending with and including the date on which the
proposed payment is to be made shall not exceed seventy-five
per cent (75%) of the net income of the corporation
available for the payment of dividends on the stock ranking
junior to the Preferred Stock-Cumulative as to dividends and
assets for the twelve full calendar months immediately
preceding the calendar month in which such dividend is
declared; and
(3) except to the extent permitted under subsections
(1) and (2) above, the corporation shall not make any
payment of junior stock dividends which would reduce the
junior stock equity to less than twenty-five per cent (25%)
of total capitalization.
For the purposes of this subsection H "net income" shall be
determined in accordance with sound accounting practice, less the
excess, if any, of the largest minimum depreciation requirement
or the period of any mortgage indenture to which the corporation
is a party during such period over the amount charged by the
corporation on its books for depreciation during such period.
The term "junior stock equity" is defined in subsection
E(2)(i) of Section 4 of this Article I.
The term "total capitalization" as used in this subsection H
means the aggregated of (x) the junior stock equity, (y) the par
value of, or stated capital represented by, the outstanding
shares of Preferred Stock-Cumulative and any other stock ranking
prior thereto or on a parity therewith as to dividends or assets
and the premium thereon, and (z) the principal mount of all
outstanding indebtedness of the corporation represented by bonds,
notes and other evidences of indebtedness maturing by their terms
more than one year from the date of issue thereof.
I. No stockholder, director, officer or agent of the
corporation shall be held individually responsible for any action
taken in good faith though subsequently adjudged to be in
violation of this Section 3.
J. The share of Preferred Stock-Cumulative from time to
time duly authorized may be issued for such consideration as may
be fixed from time to time either by the board of directors or
otherwise, as provided by law. Any and all shares of Preferred
Stock-Cumulative upon receipt by the corporation of the
consideration so fixed shall be deemed fully paid stock and shall
not be liable to any further call or assessment thereon.
K. Every holder of Preferred Stock-Cumulative of the
corporation by becoming such shall be held to have consented to
all of these provisions and to have agreed to be bound thereby
and to have waived to the full extent permitted by law any right
such holder may have either now or at any time in the future
contrary to these provisions
Section 4. Certain Rights of Dividend Series Preferred
Stock and Preferred Stock-Cumulative.
A. (1) If dividends accrued to the last preceding
quarterly dividend payment date or dates on the outstanding
Dividend Series Preferred Stock, Preferred Stock-Cumulative and
any other class of preferred stock ranking on a parity therewith,
as to dividends, shall at any time and from time to time equal or
exceed an amount equivalent to four (4) full quarterly dividends
on any shares of any series of the Dividend Series Preferred
Stock, Preferred Stock-Cumulative and such parity preferred stock
at the time outstanding, then until all dividends in default on
the Dividend Series Preferred Stock, Preferred Stock-Cumulative
and such parity preferred stock shall have been paid, the holders
of Dividend Series preferred Stock, Preferred Stock-Cumulative
and such parity preferred stock, voting separately as one class,
shall have the right to elect the smallest number of directors
necessary to constitute a majority of the full board of
directors, and the holders of stock generally entitled to vote,
voting separately as one class, shall have the right to elect the
remaining members of the board of directors. If and when all
dividends in default on the Dividend Series Preferred Stock,
Preferred Stock-Cumulative and such parity preferred stock shall
be paid (and, except when prevented from so doing by any
applicable restriction of law or contained in any agreement
relating to indebtedness of the corporation, such dividends shall
be declared and paid out of any funds legally available therefor
as soon as reasonably practicable unless, by a majority vote of
the directors elected by the holders of stock generally entitled
to vote, it is determined that such payment is not in the best
interests of the corporation), the Dividend Series Preferred
Stock, Preferred Stock-Cumulative and such parity preferred stock
shall thereupon be divested of such special right to elect any
member of the board of directors, but subject always to the same
provisions for the vesting of such special right in the Dividend
Series Preferred Stock, Preferred Stock-Cumulative and such
parity preferred stock in case of further like default or
defaults.
(2) Whenever under the provisions of this subsection A
the holders of Dividend Series Preferred Stock, Preferred Stock-
Cumulative and any other class of preferred stock ranking on
parity therewith as to dividends become entitled to elect a
majority of the board of directors, a special meeting of the
holders of Dividend Series Preferred Stock, Preferred Stock-
Cumulative and such parity preferred stock and a special meeting
of the stockholders generally entitled to vote shall be held for
the purpose of electing directors. Notices thereof shall be
given promptly by the corporation and in any case within fifteen
(15) days of the occurrence of such change in voting powers, the
meetings to be held not sooner than forty-five (45) days nor
later than sixty (60) days after the occurrence of such change in
voting powers. However, if the change occurs within ninety (90)
days prior to the date set for the annual meeting of the
stockholders generally entitled to vote, no special meetings need
be called prior thereto and an annual meeting of holders of
Dividend Series Preferred Stock, Preferred Stock-Cumulative and
any other such parity preferred stock shall be called for the
same date as the date of the annual meeting of stockholders
generally entitled to vote; provided, however, that, if the
change occurs within forty-five (45) days prior to the date set
for the annual meeting of the stockholders generally entitled to
vote, special meetings in lieu of annual meetings shall be called
to be held not later than sixty (60) days after such change
occurs. If the corporation fails to call the special or annual
meetings as above provided or fails to hold such annual meetings
within three (3) days of the date provided therefor in the by-
laws, any holder or holders of Dividend Series Preferred Stock,
Preferred Stock-Cumulative, such parity preferred stock and/or
stock generally entitled to vote holding in the aggregate one
thousand (1,000) shares may call special meetings for such
purpose. Notice of each such meeting of stockholders of the
corporation setting forth the purpose or purposes of such meeting
shall be mailed by the corporation not less than thirty (30) days
prior to such meeting to all stockholders at their respective
addresses appearing upon the books of the corporation entitled to
vote thereat, unless such notice shall have been waived either
before or after the holding of such meeting by all such
stockholders.
(3) Upon reversion, pursuant to subsection A(1), of the
voting powers to their status prior to default, a special or
annual meeting of stockholders generally entitled to vote shall
be held for the purpose of electing directors. Notice thereof
shall have been given promptly by the corporation and in any case
within fifteen (15) days after such reversion, such notice to be
mailed by the corporation not less than seven (7) nor more than
ten (10) days prior to such meeting to all stockholders generally
entitled to vote at their respective addresses appearing upon the
books of the corporation, unless such notice shall have been
waived either before or after the holding of such meeting by all
such stockholders. If the corporation fails to call such meeting
or fails to hold such annual meeting within three (3) days of the
date provided therefor in the by-laws, any holder or holders of
stock generally entitled to vote holding in the aggregate one
thousand (1,000) shares may call a special meeting for such
purpose.
(4) Any director elected by holders of Dividend Series
Preferred Stock, Preferred Stock-Cumulative and any other class
of preferred stock ranking on a parity therewith, as to
dividends, shall hold office until the next annual meeting of the
holders of Dividend Series Preferred Stock, Preferred Stock-
Cumulative and such parity preferred stock and until his
successor is chosen and qualified, except as otherwise provided
in this subsection A. Once any directors have been elected by
holders of Dividend Series Preferred Stock, Preferred Stock-
Cumulative and such parity preferred stock, and so long as such
holders are entitled to elect such directors, annual meetings of
such holders shall be held for the purpose of electing directors,
such meetings to immediately follow the annual meetings of
stockholders generally entitled to vote. During any period in
which the holders of Dividend Series Preferred Stock, Preferred
Stock-Cumulative and such parity preferred stock have the right
to elect a majority of the board of directors, pursuant to
subsection A(1), the number of directors constituting the full
board of directors shall be the number constituting the full
board of directors immediately prior to said period unless it be
changed by a two-thirds vote at an annual meeting of such holders
and by a two-thirds vote at an annual meeting in the same year of
the holders of stock generally entitled to vote. In the event
the number of directors is so increased or decreased, the holders
of Dividend Series Preferred Stock, Preferred Stock-Cumulative
and such parity preferred stock shall have the right at such
annual meeting to elect the smallest number of directors
necessary to constitute a majority of the new number of
directors, and the holders of stock generally entitled to vote
shall have the right to elect the remaining directors, provided,
however, that neither group of directors so elected shall be
entitled to hold office until both groups have been duly elected.
(5) At all meetings of stockholders held for the purpose of
electing directors, during such times as the holders of shares of
the Dividend Series Preferred Stock, Preferred Stock-Cumulative
and any other class of preferred stock ranking on a parity
therewith, as to dividends, shall have the right to elect a
majority of the board of directors, pursuant to the foregoing
provisions of this subsection A, the presence in person or by
proxy of the holders of a majority of the outstanding shares of
the stock generally entitled to vote, as one class, shall be
required to constitute a quorum of such class for the election of
directors and the presence in person or by proxy of the holders
of a majority of the outstanding shares of all series of the
Dividend Series Preferred Stock, Preferred Stock-Cumulative and
such parity preferred stock, voting separately as one class,
shall be required to constitute a quorum of such class for the
election of directors. The absence of a quorum of the holders of
either such class shall not prevent or invalidate the election of
directors by the other such class if the necessary quorum of the
holders of stock of such class is present in person or by proxy
at the meeting of such class or any adjournment thereof, except
that in the case of the first election following the accrual of
the special right of the holders of Dividend Series Preferred
Stock, Preferred Stock-Cumulative and any such parity preferred
stock to elect a majority of the board of directors, the
directors elected by the holders of stock generally entitled to
vote shall not take office until the election of such majority.
In the absence of a quorum of the holders of stock of either such
class, the meeting shall be adjourned from time to time, which
may be without notice other than announcement at the meeting,
until such quorum shall be obtained within ninety (90) days from
the date of such meeting as originally called (or, in the case of
any annual meeting held during the continuance of such special
right, from the date fixed for such annual meeting) the presence
in person or by proxy of the holders of one-third, instead of
said majority, of said shares shall then be sufficient to
constitute a quorum for the election of the directors whom such
stockholders are then entitled to elect. In the calculation of
any quorum of the class composed of the holders of the Dividend
Series Preferred Stock, the Preferred Stock-Cumulative and parity
preferred stock, each share of stock bearing $100 par value shall
be counted as one and each share of stock bearing $25 par value
shall be counted as one-quarter.
(6) Forthwith upon the election of a majority of the board
of directors of the corporation by the holders of Dividend Series
Preferred Stock, Preferred Stock-Cumulative and any other class
of preferred stock ranking on a parity therewith, as to
dividends, pursuant to subsection A(1) hereof, the terms of
office of all persons who may be directors of the corporation at
the time shall terminate, whether or not the holders of stock
generally entitled to vote shall then have elected the remaining
members of the board of directors, and, if the holders of stock
generally entitled to vote shall not have elected the remaining
members of the board of directors, then the directors so elected
by the holders of Dividend Series Preferred Stock, Preferred
Stock-Cumulative and such parity preferred stock shall constitute
the board of directors pending such election of the remaining
members by such holders of stock generally entitled to vote.
Upon the reversion, pursuant to subsection A(1), of the voting
powers to their status prior to default, then forthwith upon the
election of new directors by the holders of stock generally
entitled to vote, the terms of office of the directors elected by
the holders of Dividend Series Preferred Stock, Preferred Stock-
Cumulative and such parity preferred stock shall terminate.
(7) In case of any vacancy in the office of a director
elected by the holders of Dividend Series Preferred Stock,
Preferred Stock-Cumulative and any other class of preferred stock
ranking on a parity therewith, as to dividends, pursuant to the
foregoing provisions of this subsection A, the remaining
directors elected by the holders of Dividend Series Preferred
Stock, Preferred Stock-Cumulative and such parity preferred
stock, by affirmative vote of a majority of said directors, or
the remaining director so elected if there be but one, may elect
a successor or successors to hold office for the unexpired term
of the director or directors whose place or places shall be
vacant.
(8) Under all circumstances, however, the directors elected
by the holders of stock generally entitled to vote shall have the
right, and neither the holders of Dividend Series Preferred
Stock, Preferred Stock-Cumulative or any other class of preferred
stock ranking on a parity therewith, as to dividends, nor any
directors elected under these provisions by the holders of
Dividend Series Preferred Stock, Preferred Stock-Cumulative and
any other class of preferred stock ranking on a parity therewith,
as to dividends, shall have any right, to vote upon the question
of calling for redemption, or of purchasing, all of the Dividend
Series Preferred Stock, the Preferred Stock-Cumulative and such
parity preferred stock at the time outstanding.
(9) Except when some mandatory provision of law shall be
controlling or as otherwise provided in this Section 4 and, with
respect to any special rights of (i) the Dividend Series
Preferred Stock as a class, or (ii) the Preferred Stock-
Cumulative as a class, or (iii) any series of either such class
as a series, in the provisions or of the by-laws or articles of
organization controlling said class or in the votes creating said
series, neither the Dividend Series Preferred Stock nor the
Preferred Stock-Cumulative shall be entitled to vote as a
separate class, and no outstanding series of either such class
shall be entitled to vote as a separate series, on any matter and
all shares of the Dividend Series Preferred Stock of all series
and all shares of the Preferred Stock-Cumulative of all series
shall be deemed to constitute but one class for any purpose for
which a vote of the stockholders of the corporation by classes
may now or hereafter be required.
(10) During the period the Dividend Series Preferred Stock
and the Preferred Stock-Cumulative have the special voting rights
provided by this subsection A, the 6%Cumulative Preferred Stock,
which is generally entitled to vote as specified in Section 1,
may vote either as stock generally entitled to vote or as parity
preferred stock or as both.
B. So long as any shares of the Dividend Series Preferred
Stock of any series are outstanding, the corporation shall not,
without the vote at a meeting called for that purpose of the
holders of at least two-thirds of the total number of shares of
the Dividend Series Preferred Stock of all series then
outstanding make any change in the provisions relative to the
Dividend Series Preferred stock, or of any series thereof, which
would change the express terms and provisions of such stock
(other than the express terms and provisions thereof set forth in
subsections A, D, and E of this Section 4) in any manner
prejudicial to the holders thereof except that if such change is
prejudicial to the holders of one or more, but not all of such
series, only to the vote of the holders of two-thirds of the
total number of shares of all series so affected and then
outstanding shall be required.
C. So long as any shares of the Preferred Stock-Cumulative
of any series are outstanding, the corporation shall not, without
the vote at a meeting called for that purpose of the holders of
at least two-thirds of the total number of shares of the
Preferred Stock-Cumulative of all series then outstanding make
any change in the provisions relative to the Preferred Stock-
Cumulative, or of any series thereof, which would change the
express terms and provisions of such stock (other than the
express terms and provisions thereof set forth in subsections A,
D, and E of this Section 4) in any manner prejudicial to the
holders thereof except that if such change is prejudicial to the
holders of one or more, but not all of such series, only to the
vote of the holders of two-thirds of the total number of shares
of all series so affected and then outstanding shall be required.
D. So long as any shares of the Dividend Series Preferred
Stock or the Preferred Stock-Cumulative of any series are
outstanding, the corporation shall not, without the vote at a
meeting called for that purpose of at least two-thirds of the
votes entitled to be cast by the holders of the total number of
shares of the Dividend Series Preferred Stock and the Preferred
Stock-Cumulative of all series then outstanding:
(1) make any change in the provisions of this Section
4, which would change the express terms and provisions of
subsections A, D, or E of this Section 4 in any manner
prejudicial to the holders of the Dividend Series Preferred
Stock and the Preferred Stock-Cumulative except that if such
change is prejudicial to the holders of one class, but not
both, only the vote of the holders of two-thirds of the
total number of shares of the class so affected and then
outstanding shall be required; or
(2) create or authorize any class of stock which shall
be preferred as to dividends or assets over the Dividend
Series Preferred Stock or the Preferred Stock-Cumulative.
No preferred stock so preferred as to dividends or assets
over the Dividend Series Preferred Stock or the Preferred
Stock-Cumulative shall be issued more than six months after
the above referred to vote creating or authorizing such
class of stock unless within six months prior to such issue
approval thereof has been obtained, at a meeting called for
the purpose, by vote of at least two-thirds of the total
number of shares of Dividend Series Preferred Stock and the
Preferred Stock-Cumulative of all series outstanding.
"Premium" as used in this subsection D with reference to
capital stock shall mean such premium on capital stock as has
been paid in, or will have been paid in immediately after the
proposed issue of additional capital stock, and is not available
for distribution on, or purchase of, junior stock. If the
corporation has outstanding at any time shares without par value,
then references in subsection D (2) above to par value shall
refer, in the case of such shares without par value, to that part
of the stated capital represented by such share.
E. So long as any shares of the Dividend Series Preferred
Stock or the Preferred Stock-Cumulative of any series are
outstanding, the corporation shall not, without the vote at a
meeting called for that purpose of at least a majority of the
votes entitled to be case by the holders of the total number of
shares of the Dividend Series Preferred Stock and the Preferred
Stock-Cumulative of all series then outstanding:
(1) Issue shares of any series of Dividend Series
Preferred Stock or Preferred Stock-Cumulative if after such
issue the aggregate outstanding par value of all such series
would exceed $250,000,000.
(2) Issue additional shares of any series of Dividend
Series Preferred Stock or Preferred Stock-Cumulative or of
any other stock ranking prior thereto or on a parity
therewith as to dividends or assets, except for refunding an
equal par value of Dividend Series Preferred Stock or
Preferred Stock-Cumulative, or other such prior or parity
preferred stock, of the corporation theretofore outstanding:
(i) unless the junior stock equity to be
outstanding immediately after such issue shall be at
least equal to the aggregate of the par or stated value
of the Dividend Series Preferred Stock and the
Preferred Stock-Cumulative and of any other such prior
or parity stock to be outstanding immediately after
such issue; provided, however, that if for the purpose
of meeting this requirement it shall have been
necessary to take into consideration any earned surplus
of the corporation, such surplus shall not be available
thereafter for distribution of or purchase of stock
ranking junior to the Dividend Series Preferred Stock
or the Preferred Stock-Cumulative as to dividends or
assets while said additional issue is outstanding (the
term "junior stock equity" as used in this subsection E
and in subsections H of Sections 2 and 3 means the
aggregate of the par value of, or stated capital
represented by, the outstanding shares of stock ranking
junior to the Dividend Series Preferred Stock and the
Preferred Stock-Cumulative as to dividends and assets,
of the premium on such junior stock and of the surplus
(including Retained earnings and other paid-in capital)
of the corporation less, unless the amounts or items
are being amortized or are being provided for by
reserves, (a) any amounts recorded on the books of the
corporation for utility plant and other plant in excess
of the original cost thereof, (b) unamortized debt
discount and expense, capital stock discount and
expense and any other intangible items set forth on the
asset side of the balance sheet as a result of
accounting convention, (c) the excess, if any of the
aggregate amount payable on involuntary liquidation,
dissolution or winding up of the affairs of the
corporation upon all outstanding preferred stock of the
corporation over the aggregate par or stated value
thereof and any premiums thereon and (d) the aggregate
of the excess, if any, for each year and the final
fraction of a year, if any, during the period from
January 1, 1953 to the end of a month within ninety
(90) days preceding the date as of which junior stock
equity is determined, of the largest minimum
depreciation requirement for such year and such final
fraction of a year of any mortgage indenture to which
the corporation is a party during such year or such
final fraction of a year over the amount charged by the
corporation on its books for depreciation during such
year or such final fraction of a year);
(ii) unless the gross income of the corporation
available for interest on its indebtedness and for
dividends on the Dividend Series Preferred Stock, the
Preferred Stock-Cumulative and any other such prior or
parity stock, determined in accordance with sound
accounting practice, for a period of twelve (12)
consecutive calendar months within the fifteen (15)
calendar months immediately preceding the calendar
month in which such additional stock is issued, or in
which a contract for the issuance and sale thereof is
made, is at least one and one-half (1-1/2) times the
aggregate of the annual interest charges and dividend
requirements on all interest bearing indebtedness and
all series of Dividend Series Preferred Stock,
Preferred Stock-Cumulative and such prior or parity
stock to be outstanding immediately after the proposed
issue; and
(iii) unless the net income of the corporation
available for dividends on the Dividend Series
Preferred Stock, the Preferred Stock-Cumulative and any
other such prior or parity stock, determined in
accordance with sound accounting practice, for the same
twelve (12) months' period, is at least two (2) times
the aggregate of the annual dividend requirements on
all series of Dividend Series Preferred Stock,
Preferred Stock-Cumulative and such prior or parity
stock to be outstanding immediately after the proposed
issue.
In said computations in subsections (ii) and (111):
(a) interest on indebtedness and dividends on
stock in each case to be retired with the proceeds of
the proposed issue are to be excluded;
(b) such gross income or net income, respectively,
similarly determined for said twelve (12) month period,
from any property acquired by purchase, merger or
otherwise during or after said period or to be acquired
in connection with the proposed issue, may be included:
(c) the amount deducted for taxes shall be the
amount charged by the corporation on its books for
taxes; and
(d) the amount deducted for depreciation shall be
the higher of the amount charged by the corporation on
its books for depreciation during such period or the
largest minimum depreciation requirement for such
period of any mortgage indenture to which the
corporation is a party during such period.
(3) Merge or consolidate with or into any other
corporation or corporations or sell, lease or dispose of all
or substantially all its assets, unless such merger,
consolidation or sale, lease or disposition, or the issuance
and assumption of all securities to be issued or assumed in
connection therewith, shall have been ordered, approved or
permitted by the Securities and Exchange Commission under
the provisions of the Public Utility Holding Company Act of
1935 or by any successor commission or regulatory authority
of the United States of America having jurisdiction in the
premises under said Act or by any court of the United States
having such jurisdiction.
F. No stockholder, director, officer or agent of the
corporation shall be held individually responsible for any action
taken in good faith though subsequently adjudged to be in
violation of this Section 4.
The voting rights set forth in subsection B, C and D shall
not be effective if, in connection with any matter specified
therein, provision is made for the purchase, redemption or
retirement of all the Dividend Series Preferred Stock and the
Preferred Stock-Cumulative at the time outstanding, or it is
provided that the proposed action shall not be effective unless
such provision is made.
In the calculations in subsections D and E of "at least two-
thirds of the total number of shares of the Dividend Series
Preferred Stock and the Preferred Stock-Cumulative" or of "at
least a majority of the total number" of such shares, each share
of Dividend Series Preferred Stock bearing $100 par value shall
be counted as one and each share of the Preferred Stock-
Cumulative bearing $25 par value shall be counted as one-quarter.
Section 5. Maximum Issues of Preferred Stock. The
corporation shall not, without the vote at a meeting called for
the purpose of at least a majority of the shares of stock
generally entitled to vote, issue shares of any series of
Dividend Series Preferred Stock or Preferred Stock-Cumulative if
after such issue the aggregate outstanding par value of all such
series would exceed $250 million.
ARTICLE II.
Stock Certificates and Transfers.
Section 1. Certificates. Each stockholder shall be
entitled to a certificate of the capital stock of the corporation
owned by him in such form as shall, in conformity to law, be
prescribed from time to time by the board of directors. Such
certificate shall be signed by the president or a vice-president
and by the treasurer or an assistant treasurer, and shall bear
the seal of the corporation; provided, however, that when any
such certificate is signed by a transfer agent and by a registrar
and the registrar is not the same person, partnership,
association, trust or corporation as the transfer agent, the
signature of the president or a vice-president or of the
treasurer or an assistant treasurer of the corporation, or both
such signatures, or the seal of the corporation, or either or
both of such signatures and such seal, upon such certificate may
be facsimile, and such certificate shall be as valid and
effectual for all purposes as if signed by such officer or
officers, or sealed with the seal of the corporation, as the case
may be. The fact that a person signing has ceased to be an
officer shall not invalidate any such certificate.
Section 2. Transfer Books. The Treasurer or such agent
or agents as may be employed by the treasurer with the approval
of the board of directors shall keep the stock and transfer books
of the corporation and a record of all certificates of stock
issued and of all transfers of stock and a register of all the
stockholders, their addresses and the number of shares held by
each. The board of directors may fix in advance a time, not more
than thirty days preceding the date of any meeting of
stockholders or the date for the payment of any dividend or the
making of any distribution to stockholders or the last day on
which the consent or dissent of stockholders may be effectively
expressed for any purpose, as the record date for determining the
stockholders having the right to notice of and to vote at such
meeting and any adjournment thereof or the right to receive such
dividend or distribution or the right to give such consent or
dissent, and in such case only stockholders of record on such
record date shall have such right, notwithstanding any transfer
of stock on the books of the corporation after the record date;
or without fixing such record date the board of directors may for
any of such purposes close the transfer books for all or any part
of such thirty-day period.
Section 3. Transfer of Shares. Subject to the
restrictions, if any, imposed by the agreement of association,
title to a certificate of stock and to the shares represented
thereby shall be transferred only by delivery of the certificate
properly endorsed, or by delivery of the certificate accompanied
by a written assignment of the same, or a written power or
attorney to sell, assign or transfer the same or the share
represented thereby, properly executed; but the person registered
on the books of the corporation as the owner of shards shall have
the exclusive right to receive dividends thereon and to vote
thereon as such owner and, except only as may be required by law,
may in all respects be treated by the corporation as the
exclusive owner thereof.
It shall be the duty of each stockholder to notify the
corporation of his post office address.
Section 4. Loss of Certificates. In case of the alleged
loss or destruction, or the mutilation of a certificate of stock,
a duplicate certificate may be issued in place thereof, upon such
reasonable terms as the board or directors may prescribe.
ARTICLE III.
Stockholders.
Section 1. Annual Meeting. The annual meeting of
stockholders generally entitled to vote shall be held on the
third Wednesday of April in each year, if it be not a legal
holiday, and if it be a legal holiday, then on the next
succeeding full business day not a legal holiday. Annual
meetings of stockholders shall be held at the office of the
corporation in the Town of Westborough, Massachusetts, or at such
other place in Massachusetts as the president or a majority of
the directors may designate. Purposes for which annual meetings
are to be held additional to those prescribed by law, by the
agreement of association and by these by-laws may be specified by
the board of directors or by writing signed by the president or
by a majority of the directors or by stockholders who hold at
least one-tenth of the aggregated par value of the capital stock
entitled to vote at the meeting. If any such annual meeting is
omitted on the day herein provided therefor, a special meeting
may be held in place thereof, and any business transacted or
elections held at such meeting shall have the same effect as if
transacted or held at said annual meeting.
Section 2. Special Meetings. Special meetings of the
stockholders may be called to be held anywhere in Massachusetts
by the president or by a majority of the directors, and shall be
called by the clerk or, in case of the death, absence, incapacity
or refusal of the clerk, by any other officer of the corporation,
upon written application of stockholders who hold at least one-
tenth of the aggregate par value of the capital stock entitled to
vote at the meeting, stating the time, place and purpose of the
meeting.
Section 3. Notice of Meetings. Except as otherwise
provided in Section 4 of Article I, a written or printed notice
of each meeting of stockholders, stating the place, day and hour
thereof and the purpose for which the meeting is called, shall be
given by the clerk, at least seven days before such meeting, to
each stockholder entitled to vote thereat, by leaving such notice
with him or at his residence or usual place of business, or by
mailing it, postage prepaid and addressed to such stockholder at
his address as it appears upon the books of the corporation. In
the absence or disability of the clerk, such notice may be given
by a person designated either by the clerk or by the person or
persons calling the meeting or by the board of directors. No
notice of the time, place or purpose of any regular or special
meeting of the stockholders shall be required if every
stockholder entitled to notice thereof is present in person or is
represented at the meeting by proxy or if every such stockholder,
or his attorney thereunto authorized, by a writing which is filed
with the records of the meeting, waives such notice.
Section 4. Quorum. Except as otherwise provided in
Section 4 of Article I, at any meeting of the stockholders, a
majority in interest of all stock issued and outstanding and
entitled to vote upon a question to be considered at the meeting
shall constitute a quorum for the consideration of such question,
but a lesser interest may adjourn any meeting from time to time,
and the meeting may be held as adjourned without further action.
When a quorum is present at any meeting, a majority of the stock
represented thereat and entitled to vote shall, except where a
larger vote is required by law, by the agreement of association
or by these by-laws, decide any question brought before such
meeting.
Section 5. Proxies and Voting. Subject to the
provisions of Article I hereof and to provisions of law,
stockholders who are entitled to vote shall have one vote for
each share of stock owned by them, except that holders of
Preferred Stock-Cumulative shall have one-quarter vote for each
share of such stock owned by them. Stockholders may vote either
in person or by proxy in writing dated not more than six (6)
months before the meeting named therein, which shall be filed
with the clerk of the meeting before being voted. Such proxies
shall entitle the holders thereof to vote at any adjournment of
such meeting but shall not be valid after the final adjournment
of such meeting.
ARTICLE IV.
Directors.
Section 1. Powers. The board of directors shall have,
and may exercise, all the powers of the corporation, except such
as are conferred upon the stockholders by law, by the agreement
of association and by these by-laws.
Section 2. Election. A board of not less than three
directors shall be chosen by ballot at the annual meeting of the
stockholders or at the special meeting held in place thereof, or
as provided in Section 4 of Article I. The number of directors
for each corporate year shall be fixed by vote at the meeting at
which they are elected but the stockholders may, at any special
meeting held for the purpose during any such year, increase or
decrease (within the limit above specified) the number of
directors as thus fixed, and elect new directors to complete the
number so fixed, or remove directors to reduce the number of
directors to the number so fixed; provided, however, that while
thee are four (4) full quarterly dividends in default on the
Dividend Series Preferred Stock and the Preferred Stock-
Cumulative the number of such directors shall be fixed in
accordance with Section 4 of Article I. No director need be a
stockholder. Subject to law, to the articles of organization, to
the terms of the Dividend Series Preferred Stock and the
Preferred Stock -Cumulative and to the other provisions of these
by-laws, each director shall hold office until the next annual
meeting of the stockholders electing such director and until his
successor is chosen and qualified.
Section 3. Regular Meeting. Regular meetings of the
board of directors may be held at such places and at such times
as the board may by vote from time to time determine, and if so
determined, no notice thereof need be given. A regular meeting
of the board of directors may be held without notice immediately
after, and at the same place as the annual meeting of the
stockholders, or the special meeting of the stockholders held in
place of such annual meeting.
Section 4. Special Meetings. Special meetings of the
board of directors may be held at any time and at any place when
called by the president, treasurer or two or more directors,
reasonable notice thereof being given to each director, or at any
time without call or formal notice, provided all the directors
are present or waive notice thereof by a writing which is filed
with the records of the meeting. In any case it shall be deemed
sufficient notice to a director to send notice by mail or
telegram at least forty-eight hours before the meeting addressed
to him as his usual or last known business or residence address.
Section 5. Quorum. A majority of the board of
directors shall constitute a quorum for the transaction of
business, but a less number may adjourn any meeting from time to
time, and the meeting may be held as adjourned without further
notice. Except as otherwise provided, when a quorum is present
at any meeting, a majority of the members in attendance thereat
shall decide any question brought before such meeting.
Section 6. Vacancies. If the office of any director,
one or more, elected by the stockholders generally entitled to
vote, becomes vacant by reason of death, resignation, removal,
disqualification or otherwise, the remaining directors so
elected, though less than a quorum, may, unless such vacancy
shall have been filled by the stockholders generally entitled to
vote, choose by a majority vote of their entire number, a
successor or successors, who shall hold office for the unexpired
term. Any vacancy in the office of a director elected by holders
of the Dividend Series Preferred Stock and the Preferred Stock-
Cumulative shall be filled as provided in Section 4 of Article I.
ARTICLE V.
Officers.
Section 1. Election and Appointment. The officers shall
be a president, a clerk, a treasurer and such other officers and
agents as the board of directors may in their discretion appoint.
The treasurer and the clerk shall be chosen by ballot at the
annual meeting of the stockholders generally entitled to vote.
The president shall be elected annually by the board of directors
after its election by the stockholders. The president shall be a
director. The clerk shall be a resident of Massachusetts. So
far as is permitted by law, any two or more offices may be filled
by the same person. Subject to law, to the agreement of
association and to the other provisions of theses by-laws, the
treasurer and clerk shall each hold office until the next annual
meeting of stockholders generally entitled to vote and until his
successor is chosen and qualified, the president shall hold
office until the first meeting of directors after the next annual
meeting of stockholders generally entitled to vote and until his
successor is chosen and qualified and the other officers and
agents shall hold office during the pleasure of the board of
directors or for such term as the board of directors shall
prescribe. Each officer shall, subject to these by-laws, have in
addition to the duties and powers herein set forth such duties
and powers as are commonly incident to his office, and such
duties and powers as the board of directors shall from time to
time designate.
Section 2. President. Except as otherwise determined by
the board of directors, the president shall be the chief
executive officer of the corporation and shall preside at all
meetings of the stockholders and of the board of directors at
which he is present. The president shall have custody of the
treasurer's bond.
Section 3. Clerk. The clerk shall keep an accurate
record of the proceedings of all meetings of the stockholders in
books provided for the purpose, which books shall be kept at the
principal office of the corporation and shall be open at all
reasonable times to the inspection of any stockholder. In the
absence of the clerk at any such meeting, a temporary clerk shall
be chosen, who shall record the proceedings of such meeting in
the aforesaid books. The clerk and such temporary clerk shall be
sworn.
If no secretary is appointed, the clerk shall also keep
accurate minutes of all meetings of the board of directors and in
his absence from any such meeting a temporary clerk shall be
chosen, who shall be sworn and shall record the proceedings of
such meeting.
Section 4. Secretary. If a secretary is appointed, he
shall keep accurate minutes of all meetings of the board of
directors, and in his absence from any such meeting a temporary
secretary shall record the proceedings thereof.
Section 5. Treasurer. The treasurer shall, subject to
the direction and under the supervision of the board of
directors, have general charge of the financial concerns of the
corporation and the care and custody of the funds and valuable
papers of the corporation, except his own bond, and he shall have
power to endorse for deposit or collection all notes, checks,
drafts, etc., payable to the corporation or its order, and to
accept drafts on behalf of the corporation. He shall keep, or
cause to be kept, accurate books of account, which shall be the
property of the corporation. If required by the board of
directors he shall give bond for the faithful performance of his
duty in such form, in such sum, and with such sureties as the
board of directors shall require.
Any assistant treasurer shall have such powers as the board
of directors shall from time to time designate.
Section 6. Removals. The stockholders generally
entitled to vote may, at any special meeting called for the
purpose, by vote of a majority of the capital stock issued and
outstanding and generally entitled to vote, remove from office
the treasurer, clerk or any director elected by the stockholders
generally entitled to vote, and elect his successor. The board
of directors may likewise, by vote of a majority of their entire
number, remove from office any officer or agent of the
corporation; provided, however, that the board of directors may
remove the treasurer or clerk for cause only.
Section 7. Vacancies. If the office of any officer or
agent, one or more, becomes vacant by reason of death,
resignation, removal, disqualification or otherwise, the
directors may, unless such vacancy, if in the office of the
treasurer or clerk, shall have been filled by the stockholders
generally entitled to vote, choose by a majority vote of their
entire number, a successor or successors, who shall hold office
for the unexpired term, subject to the provisions of Section 6 of
this Article V.
ARTICLE V-A
Liability and Indemnification.
No director of the corporation shall be personally liable to
the corporation or its stockholders for monetary damages for
breach of fiduciary duty as a director notwithstanding any
provision of law imposing such liability, except with respect to
any matter as to which such liability shall have been imposed (i)
for any breach of the director's duty of loyalty to the
corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under section sixty-one or sixty-
two of chapter one hundred and fifty-six B of the General Laws of
Massachusetts, or (iv) for any transaction from which the
director derived an improper personal benefit.
The corporation shall indemnify each of its directors and
officers against any loss, liability or expense, including
amounts paid in satisfaction of judgments, in compromise or as
fines and penalties, and counsel fees, imposed upon or reasonably
incurred by him in connection with the defense or disposition of
any action, suit or other proceeding, whether civil or criminal,
including but not limited to derivative suits (to the extent
permitted by law), in which he may be involved or with which he
may be threatened, while in office or thereafter, by reason of
his being or having been a director or officer, except with
respect to any matter as to which he shall have been adjudicated
in such action, suit or proceeding not to have acted in good
faith in the reasonable belief that his action was in the best
interests of the corporation, or, to the extent that such matter
relates to service with respect to any employee benefit plan, as
in the best interests of the participants or beneficiaries of
such plan. As to any matter disposed of by a compromise payment
by a director or officer, pursuant to a consent decree or
otherwise, no indemnification either for said payment or for any
other expenses shall be provided unless such compromise shall be
approved as in the best interests of the corporation, after
notice that it involves such indemnification, if no change in
control has occurred (a) by a disinterested majority of the
directors then in office, (b) by a majority of the disinterested
directors then in office, provided that there has been obtained
an opinion in writing of independent legal counsel to the effect
that such director or officer appears to have acted in good faith
in the reasonable belief that his action was in the best
interests of the corporation, or (c) by the vote, at a meeting
duly called and held, of the holders of a majority of the shares
outstanding and entitled to vote thereon, exclusive of any shares
owned by any interested director or officer or, if a change in
control shall have occurred, by an opinion in writing of
independent legal counsel to the effect that such director or
officer appears to have acted in good faith in the reasonable
belief that his action was in the best interests of the
corporation.
Expenses incurred with respect to the defense or disposition
of any action, suit or proceeding heretofore referred to in this
Article shall be advanced by the corporation prior to the final
disposition of such action, suit or proceeding, upon receipt of
an undertaking by or on behalf of the recipient to repay such
amount if it is ultimately determined that he is not entitled to
indemnification, which undertaking shall be accepted without
reference to the financial ability of the recipient to make such
repayment. If in an action, suit or proceeding brought by or in
right of the corporation, a director is held not liable, whether
because relieved of liability under the first paragraph of this
Article or otherwise, he shall be deemed to have been entitled to
indemnification for expenses incurred in defense of said action,
suit or proceeding.
(i) The term "officer" includes (a) persons who serve
at the request of the corporation as directors, officers, or
trustees of another organization and (b) employees of the
corporation and its affiliates who serve in any capacity
with respect to benefit plans for the corporation's
employees.
(ii) An "interested director" or officer is one against
whom in such capacity the proceeding in question or another
proceeding on the same or similar grounds is then pending.
(iii) A "change in control" occurs when (a) any
individual, corporation, association, partnership, joint
venture, trust or other entity or association thereof acting
in concert (excluding any employee benefit plan, dividend
reinvestment plan or similar plan of the corporation, or any
trustee thereof acting in such capacity) acquires more than
20% of the corporation's outstanding stock having general
voting rights or more than 20% of the common shares of any
entity owning more than 50% of the corporation's outstanding
stock having general voting rights, whether in whole or in
part, by means of an offer made publicly to the holders of
all or substantially all of such outstanding stock or shares
to acquire stock or shares for cash, other property, or a
combination thereof or by any other means, unless the
transaction is consented to by vote of a majority of the
continuing directors; or (b) continuing directors cease to
constitute a majority of the board.
(iv) The term "continuing director" shall mean any
director of the corporation who (a) was a member of the
board of directors of the corporation on the later of
January 1, 1987, or the date the director or officer seeking
indemnification first became such, or (b) was recommended
for his initial term of office by a majority of continuing
directors in office at the time of such recommendation.
Nothing contained in this Article shall (i) limit the power
of the corporation to indemnify employees and agents of the
corporation or its subsidiaries other than directors and officers
on any terms it deems appropriate not prohibited by law, (ii)
limit the power of the corporation to indemnify directors and
officers for expenses incurred in suits, actions, or other
proceedings initiated by such director of officer or (iii) affect
any rights to indemnification to which corporation personnel
other than directors and officers may be entitled by contract or
otherwise. The rights provided in this Article shall not be
exclusive of or affect any other right to which any director or
officer may be entitled and such rights shall inure to the
benefit of its or his successors, heirs, executors,
administrators and other legal representatives. Such other
rights shall include all powers, immunities and rights of
reimbursement allowable under the laws of The Commonwealth of
Massachusetts.
The provisions of this Article shall not apply with respect
to any act or omission occurring prior to June 25, 1987. No
amendment to or repeal of this Article shall apply to or have any
effect upon the liability, exoneration or indemnification of any
director or officer for or with respect to any acts or omissions
of the director or officer occurring prior to such amendment or
repeal.
ARTICLE VI.
Seal.
The seal of the corporation shall, subject to alteration by
the board of directors, consist of a flat-faced circular die with
the words "New England Power Company Massachusetts" on the
periphery, and the words "Corporate Seal Consolidated 1916"
within the circle, cut or engraved thereon.
ARTICLE VII.
Execution of Papers.
Except as the board of directors may generally or in
particular cases authorized the execution thereof in some other
manner, all deeds, leases, transfers, contracts, bonds, notes,
checks, drafts and other obligations made, accepted or endorsed
by the corporation, shall be signed by the president, any vice-
president, the treasurer or any assistant treasurer.
ARTICLE VII.
Fiscal Year.
Except as from time to time otherwise provided by the board
of directors, the fiscal year of the corporation shall be the
calendar year.
ARTICLE IX.
Amendments.
Subject to the provisions of law and of the Dividend Series
Preferred Stock and the Preferred Stock-Cumulative, these by-laws
may be amended, altered or repealed by a vote of a majority of
the outstanding capital stock generally entitled to vote at any
meeting of such stockholders, provided notice of the proposed
amendment, alteration or repeal is given in the notice of said
meeting.