Exhibit 3.1
USX Corporation
Restated
Certificate of Incorporation
FILED IN OFFICE OF SECRETARY OF STATE,
STATE OF DELAWARE
MAY 1, 1999
Table of
Contents
Article First-Corporate Name 1
Article Second-Registered Office 1
Article Third-Corporate Purpose 1
Article Fourth-Capital Stock 1
Division I-Common Stock 1
1. Dividend Rights 1
2. Exchange and Redemption 2
3. Voting Rights 7
4. Liquidation Rights 9
5. Definitions 9
6.Determinations of the Board of Directors 12
Division II-Preferred Stock 12
Series A Junior Preferred Stock 13
6.50% Cumulative Convertible Preferred Stock 19
Article Fifth-Perpetual Existence 35
Article Sixth-Stockholder Liability 35
Article Seventh-Board of Directors 35
Article Eighth-By-laws 36
Article Ninth-Inspection of Accounts 36
Article Tenth-Dividends and Debt Obligations 36
Article Eleventh-Director Liability 36
Article Twelfth-Power and Authority 36
Article Thirteenth-Amendment of Certificate of Incorporation 37
Restated
Certificate of Incorporation
of
USX Corporation
(Originally incorporated under the name of U. S.
Steel Company on September 10, 1965)
First: The name of the Corporation (which is hereinafter
referred to as the "Corporation") is
USX Corporation
Second: Its registered office and place of business in the
State of Delaware is located at 1013 Centre Road, City of
Wilmington, County of New Castle. The registered agent in
charge thereof upon whom process against the Corporation
may be served is the Prentice-Hall Corporation System, Inc.
Third: The purposes of the Corporation are to engage in any
lawful act or activity for which corporations may be organized
under the General Corporation Law of Delaware, and without
limiting the foregoing to engage in integrated steel operations
and to develop, mine, produce, manufacture, construct, transport,
buy, hold, sell and generally deal in products, materials, property,
both tangible and intangible, and services of all kinds.
Fourth: The total number of shares of capital stock which the
Corporation shall have authority to issue is Eight Hundred Forty
Million (840,000,000), of which Forty Million (40,000,000) shares
shall be shares of Preferred Stock, without par value (hereinafter
called "Preferred Stock"), Five Hundred Fifty Million (550,000,000)
shares shall be shares of a class of common stock designated as
USX-Marathon Group Common Stock, par value $1.00 per share
("Marathon Stock"), Two Hundred Million (200,000,000) shares shall
be shares of a class of common stock designated as USX-U.S. Steel
Group Common Stock, par value of $1.00 per share ("Steel Stock"),
and Fifty Million (50,000,000) shares shall be shares of a class of
common stock designated as USX-Delhi Group Common Stock, par value
$1.00 per share ("Delhi Stock"). The Marathon Stock, the Steel Stock
and the Delhi Stock shall hereinafter collectively be called the
"Common Stock".
DIVISION I
The powers and rights of the shares of each class of Common Stock,
and the qualifications, limitations or restrictions therof, are
as follows:
1. Dividend Rights. Subject to the express terms of any outstanding
series of Preferred Stock, dividends may be declared and paid upon each
class of the Common Stock upon the terms provided for below with respect
to each such class solely in the discretion of the Board of Directors:
(a) Dividends on Marathon Stock. Dividends on the Marathon Stock
may be declared and paid out of funds of the Corporation legally
available therfor.
(b) Dividends on Steel Stock. Dividends on the Steel Stock may be
declared and paid only out of the lesser of (i) funds of the Corporation
legally available therfor and (ii) the Available Steel Dividend Amount.
(c) Dividends on Delhi Stock. Dividends on the Delhi Stock may be
declared and paid only out of the lesser of (i) funds of the Corporation
legally available therfor and (ii) the Available Delhi Dividend Amount.
(d) Discrimination Between Classes of Common Stock. The Board of
Directors, subject to the provisions of Sections 1(a), 1(b), 1(c), may
in its sole discretion, declare and pay dividends exclusively on any
class or classes of Common Stock in equal or unequal amounts,
notwithstanding the amounts of funds available for dividends on each
class, the respective voting and liquidation rights of each class, the
amount of prior dividends declared on each class or any other factor.
2. Exchange and Redemption. Shares of each class of Common Stock are
subject to exchange or redemption, as the case may be, upon the terms
provided below with respect to each such class; provided that no such class
may be exchanged or redeemed in its entirety if all of the other classes have
been, or are at the time being, exchanged or redeemed in their entirety:
(a) Exchange and Redemption of Marathon Stock.
(i) At any time on or after the date on which the Corporation has
transferred all of the assets and liabilities of the Marathon Group to
a wholly owned subsidiary of the Corporation (the ''Marathon Group
Subsidiary''), the Board of Directors may, in its sole discretion and
by a majority vote of the directors then in office, provided that there
are funds of the Corporation legally available therefor, declare that
all of the outstanding shares of Marathon Stock shall be exchanged on
an Exchange Date set forth in a notice to holders of Marathon Stock
pursuant to Section 2(d)(i), for all of the outstanding shares of
common stock of the Marathon Group Subsidiary, on a pro rata basis,
each of which shall, upon such issuance, be fully paid and
nonassessable.
(ii) After any Exchange Date for Marathon Stock, any share of
Marathon Stock that is issued on conversion or exercise of any
Convertible Securities shall, to the extent of funds of the Corporation
legally available therefor, immediately upon issuance pursuant to such
conversion or exercise and without any notice or any other action on
the part of the Corporation or its Board of Directors or the holder of
such share of Marathon Stock, be redeemed for $.01 in cash.
(b) Exchange and Redemption of Steel Stock.
(i) In the event of the Disposition, in one transaction or a series
of related transactions, by the Corporation of all or substantially all
of the properties and assets of the U.S. Steel Group (other than in
connection with the Disposition by the Corporation of all of its
properties and assets in one transaction) to any person, entity or
group (other than (A) the holders of all outstanding shares of Steel
Stock on a pro rata basis or (B) any person, entity or group in which
the Corporation, directly or indirectly, owns a majority equity
interest), the Corporation shall, on or prior to the first Business Day
following the 60th day following the consummation of such Disposition,
either:
(A) subject to paragraph 1(b) above, declare and pay a dividend in
cash and/or in securities or other property received as proceeds of
such Disposition to the holders of Steel Stock in an amount equal to
the Net Proceeds of such Disposition; or
(B) to the extent that there are funds of the Corporation legally
available therefor, redeem the number of whole shares of outstanding
Steel Stock that has an aggregate average Market Value, during the
ten-Business Day period beginning on the first Business Day
following such consummation, closest to the value of the Net
Proceeds of such Disposition, for cash and/or securities or other
property received as proceeds of such Disposition in an amount equal
to such Net Proceeds; or
(C) exchange each outstanding share of Steel Stock for a number of
fully paid and nonassessable shares of Marathon Stock or, if there
are no shares of Marathon Stock outstanding on the Exchange Date and
shares of Delhi Stock are then outstanding, of Delhi Stock equal to
110% of the average daily ratio (calculated to the nearest five
decimal places) of the Market Value of one share of Steel Stock to
the Market Value of one share of Marathon Stock or one share of
Delhi Stock, as the case may be, during such ten-Business Day
period.
For purposes of this Section 2(b)(i):
(x) as of any date, ''substantially all of the properties and assets
of the U.S. Steel Group'' shall mean a portion of such properties and
assets that represents at least 80% of either of the then-current
market value of, or the aggregate revenues for the immediately
preceding twelve fiscal quarterly periods of the Corporation derived
from, the properties and assets of the U.S. Steel Group as of such date
(excluding the properties and assets of any person, entity or group in
which the Corporation, directly or indirectly, owns less than a
majority equity interest);
(y) if immediately after any event, the Corporation, directly or
indirectly, owns less than a majority equity interest in any person,
entity or group in which the Corporation, directly or indirectly, owned
a majority equity interest immediately prior to the occurrence of such
event, a Disposition of all of the properties and assets of the U.S.
Steel Group owned by such person, entity or group shall be deemed to
have occurred; and
(z) in the case of a Disposition of properties and assets in a series
of related transactions, such Disposition shall not be deemed to have
been consummated until the consummation of the last of such
transactions.
(ii) The Board of Directors may, by a majority vote of the directors
then in office, at any time after a dividend or redemption pursuant to
clause (A) or (B), respectively, of Section 2(b)(i), declare that each
of the remaining outstanding shares of Steel Stock shall be exchanged,
on an Exchange Date set forth in a notice to holders of Steel Stock
pursuant to Section 2(d)(i), for a number of fully paid and
nonassessable shares of Marathon Stock or, if there are no shares of
Marathon Stock outstanding on such Exchange Date and shares of Delhi
Stock are then outstanding, of Delhi Stock, equal to 110% of the Market
Value Ratio as of the fifth Business Day prior to the date such notice
is mailed to such holders. For purposes of the preceding sentence,
''Market Value Ratio'', as of any date, shall mean the highest of the
following (calculated to the nearest five decimal places): (A) the
average ratio of S/X for the five-Business Day period ending on such
date, (B) the quotient of (1) the sum of (w) four times the average
ratio of S/X for the five-Business Day period ending on such date, (x)
three times the average ratio of S/X for the next preceding five-
Business Day period, (y) two times the average ratio of S/X for the
next preceding five-Business Day period and (z) the average ratio of
S/X for the next preceding five-Business Day period, divided by (2) ten
and (C) if the dividend pursuant to clause (A) of Section 2(b)(i) was
declared and paid or the redemption pursuant to (B) of Section 2(b)(i)
was made prior to the commencement of the most recently completed
fiscal quarter of the Corporation, the average ratio of S/X for such
fiscal quarter, where S is the Market Value of one share of Steel Stock
and X is the Market Value of one share of Marathon Stock or one share
of Delhi Stock, as the case may be.
(iii) At any time on or after the date on which the Corporation has
transferred all of the assets and liabilities of the U.S. Steel Group
(and no other assets or liabilities) to a wholly owned subsidiary of
the Corporation (the ''U.S. Steel Group Subsidiary''), the Board of
Directors may, in its sole discretion and by a majority vote of the
directors then in office, provided that there are funds of the
Corporation legally available therefor, declare that all of the
outstanding shares of Steel Stock shall be exchanged on an Exchange
Date set forth in a notice to holders of Steel Stock pursuant to
Section 2(d)(i), for all of the outstanding shares of common stock of
the U.S. Steel Group Subsidiary, on a pro rata basis, each of which
shall, upon such issuance, be fully paid and nonassessable.
(iv) After any Exchange Date or Redemption Date on which all
outstanding Steel Stock was exchanged or redeemed, any share of Steel
Stock that is issued on conversion or exercise of any Convertible
Securities shall, immediately upon issuance pursuant to such conversion
or exercise and without any notice or any other action on the part of
the Corporation or its Board of Directors or the holder of such share
of Steel Stock:
(A) in the event the then-outstanding Steel Stock was exchanged for
Marathon Stock or Delhi Stock on such Exchange Date pursuant to
Section 2(b)(i) or 2(b)(ii), be exchanged for the kind and amount of
shares of capital stock and other securities and property that a
holder of such Convertible Security would have been entitled to
receive pursuant to the terms of such Convertible Security had such
terms provided that the conversion privilege in effect immediately
prior to any exchange by the Corporation of any of its capital stock
for shares of any other capital stock of the Corporation would be
adjusted so that the holder of any such Convertible Security
thereafter surrendered for conversion would be entitled to receive
the number of shares of capital stock of the Corporation and other
securities and property he would have owned immediately following
such action had such Convertible Security been converted immediately
prior thereto; or
(B) in the event the then-outstanding Steel Stock was redeemed in
whole pursuant to clause (B) of Section 2(b)(i) or exchanged for
common stock of the U.S. Steel Group Subsidiary pursuant to Section
2(b)(iii), be redeemed, to the extent of funds of the Corporation
legally available therefor, for $.01 in cash.
The provisions of clause (A) of this Section 2(b)(iv) shall not
apply to the extent that equivalent adjustments are otherwise made
pursuant to the provisions of such Convertible Securities.
(c) Exchange and Redemption of Delhi Stock.
(i) In the event of the Disposition, in one transaction or a series
of related transactions, by the Corporation of all or substantially all
of the properties and assets of the Delhi Group (other than in
connection with the Disposition by the Corporation of all of its
properties and assets in one transaction) to any person, entity or
group (other than (A) the holders of all outstanding shares of Delhi
Stock on a pro rata basis or (B) any person, entity or group in which
the Corporation, directly or indirectly, owns a majority equity
interest), the Corporation shall, on or prior to the first Business Day
following the 60th day following the consummation of such Disposition,
either:
(A) subject to paragraph 1(c) above, declare and pay a dividend in
cash and/or in securities or other property received as proceeds of
such Disposition to the holders of Delhi Stock in an amount equal to
the product of the Delhi Fraction and the Net Proceeds of such
Disposition; or
(B) to the extent that there are funds of the Corporation legally
available therefor, redeem the number of whole shares of outstanding
Delhi Stock that has an aggregate average Market Value, during the
ten-Business Day period beginning on the first Business Day
following such consummation, closest to the value of the product of
the Delhi Fraction and the Net Proceeds of such Disposition, for
cash and/or securities or other property received as proceeds of
such Disposition in an amount equal to such product; or
(C) exchange each outstanding share of Delhi Stock for a number of
fully paid and nonassessable shares of Marathon Stock or, if there
are no shares of Marathon Stock outstanding on such Exchange Date
and shares of Steel Stock are then outstanding, of Steel Stock,
equal to 110% of the average daily ratio (calculated to the nearest
five decimal places) of the Market Value of one share of Delhi Stock
to the Market Value of one share of Marathon Stock or one share of
Steel Stock, as the case may be, during such ten-Business Day
period.
For purposes of this Section 2(c)(i):
(x) as of any date, ''substantially all of the properties and assets
of the Delhi Group'' shall mean a portion of such properties and assets
that represents at least 80% of either of the then-current market value
of, or the aggregate revenues for the immediately preceding twelve
fiscal quarterly periods of the Corporation derived from, the
properties and assets of the Delhi Group as of such date (excluding the
properties and assets of any person, entity or group in which the
Corporation, directly or indirectly, owns less than a majority equity
interest);
(y) if immediately after any event, the Corporation, directly or
indirectly, owns less than a majority equity interest in any person,
entity or group in which the Corporation, directly or indirectly, owned
a majority equity interest immediately prior to the occurrence of such
event, a Disposition of all of the properties and assets of the Delhi
Group owned by such person, entity or group shall be deemed to have
occurred; and
(z) in the case of a Disposition of properties and assets in a series
of related transactions, such Disposition shall not be deemed to have
been consummated until the consummation of the last of such
transactions.
(ii) The Board of Directors may, by a majority vote of the directors
then in office, at any time after a dividend or redemption pursuant to
clause (A) or (B), respectively, of Section 2(c)(i), declare that each
of the remaining outstanding shares of Delhi Stock shall be exchanged,
on an Exchange Date set forth in a notice to holders of Delhi Stock
pursuant to Section 2(d)(i), for a number of fully paid and
nonassessable shares of Marathon Stock or, if there are no shares of
Marathon Stock outstanding on such Exchange Date and shares of Steel
Stock are then outstanding, of Steel Stock equal to 110% of the Market
Value Ratio as of the fifth Business Day prior to the date such notice
is mailed to such holders.
(iii) The Board of Directors may, by a majority vote of the directors
then in office, at any time declare that each of the outstanding shares
of Delhi Stock shall be exchanged, on an Exchange Date set forth in a
notice to holders of Delhi Stock pursuant to Section 2(d)(i), for a
number of fully paid and nonassessable shares of Marathon Stock or, if
there are no shares of Marathon Stock outstanding on such Exchange
Date, of Steel Stock equal to 115% of the Market Value Ratio as of the
fifth Business Day prior to the date such notice is mailed to such
holders.
(iv) For purposes of Section 2(c)(ii) and (iii), the ''Market Value
Ratio'', as of any date, shall mean the highest of the following
(calculated to the nearest five decimal places): (A) the average ratio
of D/X for the five-Business Day period ending on such date, (B) the
quotient of (1) the sum of (w) four times the average ratio of D/X for
the five-Business Day period ending on such date, (x) three times the
average ratio of D/X for the next preceding five-Business Day period,
(y) two times the average ratio of D/X for the next preceding five-
Business Day period and (z) the average ratio of D/X for the next
preceding five-Business Day period, divided by (2) ten and (C) if the
dividend pursuant to clause (A) of Section 2(c)(i) was declared and
paid or the redemption pursuant to clause (B) of Section 2(c)(i) was
made prior to the commencement of the most recently completed fiscal
quarter of the Corporation, the average ratio of D/X for such fiscal
quarter, where D is the Market Value of one share of Delhi Stock and X
is the Market Value of one share of Marathon Stock or one share of
Steel Stock, as the case may be.
(v) At any time on or after the date on which the Corporation has
transferred all of the assets and liabilities of the Delhi Group (and
no other assets or liabilities) to a wholly owned subsidiary of the
Corporation (the ''Delhi Group Subsidiary''), the Board of Directors
may, in its sole discretion and by a majority vote of the directors
then in office, provided that there are funds of the Corporation
legally available therefor, declare that all of the outstanding shares
of Delhi Stock shall be exchanged on an Exchange Date set forth in a
notice to holders of Delhi Stock pursuant to Section 2(d)(i), for a
number of outstanding shares of common stock of the Delhi Group
Subsidiary equal to the product of the Delhi Fraction and the number of
all outstanding shares of common stock of the Delhi Group Subsidiary,
on a pro rata basis, each of which shall, upon such issuance, be fully
paid and nonassessable.
(vi) After any Exchange Date or Redemption Date on which all
outstanding Delhi Stock was exchanged or redeemed, any share of Delhi
Stock that is issued on conversion or exercise of any Convertible
Securities shall, immediately upon issuance pursuant to such conversion
or exercise and without any notice or any other action on the part of
the Corporation or its Board of Directors or the holder of such share
of Delhi Stock:
(A) in the event the then-outstanding Delhi Stock was exchanged for
Marathon Stock or Steel Stock on such Exchange Date pursuant to
Section 2(c)(i), 2(c)(ii) or 2(c)(iii), be exchanged for the kind
and amount of shares of capital stock and other securities and
property that a holder of such Convertible Security would have been
entitled to receive pursuant to the terms of such Convertible
Security had such terms provided that the conversion privilege in
effect immediately prior to any exchange by the Corporation of any
of its capital stock for shares of any other capital stock of the
Corporation would be adjusted so that the holder of any such
Convertible Security thereafter surrendered for conversion would be
entitled to receive the number of shares of capital stock of the
Corporation and other securities and property he would have owned
immediately following such action had such Convertible Security been
converted immediately prior thereto; or
(B) in the event the then-outstanding Delhi Stock was redeemed in
whole pursuant to clause (B) of Section 2(c)(i) or exchanged for
common stock of the Delhi Group Subsidiary pursuant to Section
2(c)(v), be redeemed, to the extent of funds of the Corporation
legally available therefor, for $.01 in cash.
The provisions of clause (A) of this Section 2(c)(vi) shall not apply
to the extent that equivalent adjustments are otherwise made pursuant
to the provisions of such Convertible Securities.
(d) General Exchange and Redemption Provisions.
(i) In the event of any exchange or redemption pursuant to this
Section 2 (other than Section 2(a)(ii), 2(b)(iv), or 2(c)(vi)), the
Corporation shall cause to be given to each holder of the class of
Common Stock to be so exchanged or redeemed a notice stating (A) that
shares of such class of Common Stock shall be exchanged or redeemed, as
the case may be, (B) the Exchange Date or the Redemption Date, (C) in
the event of a partial redemption of Steel Stock or Delhi Stock, as the
case may be, pursuant to clause (B) of Section 2(b)(i) or clause (B) of
Section 2(c)(i), respectively, the number of shares of Steel Stock or
Delhi Stock, as the case may be, to be redeemed, (D) the kind and
amount of shares of capital stock or cash and/or securities or other
property to be received by such holder with respect to each share of
such class of Common Stock held by such holder, including details as to
the calculation thereof, (E) the place or places where certificates for
shares of such class of Common Stock, properly endorsed or assigned for
transfer (unless the Corporation shall waive such requirement), are to
be surrendered for delivery of certificates for shares of such capital
stock or cash and/or securities or other property and (F) that, subject
to Section 2(d)(iv) hereof, dividends on such shares of Common Stock
will cease to be paid as of such Exchange Date or Redemption Date. Such
notice shall be sent by first-class mail, postage prepaid, not less
than 30 nor more than 60 days prior to the Exchange Date or Redemption
Date, as the case may be, and in any case to each holder of the class
of Common Stock to be exchanged or redeemed, at such holder's address
as the same appears on the stock transfer books of the Corporation.
Neither the failure to mail such notice to any particular holder of
such class of Common Stock nor any defect therein shall affect the
sufficiency thereof with respect to any other holder of such class of
Common Stock.
(ii) If less than all of the outstanding shares of Steel Stock or
Delhi Stock, as the case may be, are to be redeemed pursuant to clause
(B) of Section 2(b)(i) or clause (B) of Section 2(c)(i), respectively,
such shares shall be redeemed by the Corporation pro rata among the
holders of such class of Common Stock or by such other method as may be
determined by the Board of Directors to be equitable.
(iii) The Corporation shall not be required to issue or deliver
fractional shares of any class of capital stock or any fractional
securities to any holder of any class of Common Stock upon any
exchange, redemption, dividend or other distribution pursuant to this
Section 2. If more than one share of any class of Common Stock shall be
held at the same time by the same holder, the Corporation may aggregate
the number of shares of any class of capital stock that shall be
issuable or the amount of securities that shall be deliverable to such
holder upon any exchange, redemption, dividend or other distribution
(including any fractions of shares or securities). If the number of
shares of any class of capital stock or the amount of securities
remaining to be issued or delivered to any holder of any class of
Common Stock is a fraction, the Corporation shall, if such fraction is
not issued or delivered to such holder, pay a cash adjustment in
respect of such fraction in an amount equal to the fair market value of
such fraction on the fifth Business Day prior to the date such payment
is to be made. For purposes of the preceding sentence, ''fair market
value'' of any fraction shall be (i) in the case of any fraction of a
share of capital stock of the Corporation, the product of such fraction
and the Market Value of one share of such capital stock and (ii) in the
case of any other fractional security, such value as is determined by
the Board of Directors.
(iv) No adjustments in respect of dividends shall be made upon the
exchange or redemption of any shares of any class of Common Stock;
provided, however, that if the Exchange Date or Redemption Date with
respect to any class of Common Stock shall be subsequent to the record
date for the payment of a dividend or other distribution thereon or
with respect thereto, the holders of shares of such class of Common
Stock at the close of business on such record date shall be entitled to
receive the dividend or other distribution payable on or with respect
to such shares on the date set for payment of such dividend or other
distribution, notwithstanding the exchange or redemption of such shares
or the Corporation's default in payment of the dividend or distribution
due on such date.
(v) Before any holder of shares of any class of Common Stock shall be
entitled to receive certificates representing shares of any capital
stock or cash and/or securities or other property to be received by
such holder with respect to such shares of such class of Common Stock
pursuant to this Section 2, such holder shall surrender at such office
as the Corporation shall specify certificates for such shares of such
class of Common Stock, properly endorsed or assigned for transfer
(unless the Corporation shall waive such requirement). The Corporation
will as soon as practicable after such surrender of certificates
representing such shares of such class of Common Stock deliver to the
person for whose account such shares of such class of Common Stock were
so surrendered, or to his nominee or nominees, certificates
representing the number of whole shares of the kind of capital stock or
cash and/or securities or other property to which he shall be entitled
as aforesaid, together with any fractional payment contemplated by
Section 2(d)(iii). If less than all of the shares of any class of
Common Stock, represented by any one certificate are to be redeemed,
the Corporation shall issue and deliver a new certificate for the
shares of such class of Common Stock not redeemed.
(vi) From and after any applicable Exchange Date or Redemption Date,
all rights of a holder of shares of any class of Common Stock that were
exchanged or redeemed shall cease except for the right, upon surrender
of the certificates representing such shares of Common Stock, to
receive certificates representing shares of the kind and amount of
capital stock or cash and/or securities or other property for which
such shares were exchanged or redeemed, together with any fractional
payment contemplated by Section 2(d)(iii) and rights to dividends as
provided in Section 2(d)(iv). No holder of a certificate, that
immediately prior to the applicable Exchange Date for any class of
Common Stock represented shares of such class of Common Stock, shall be
entitled to receive any dividend or other distribution with respect to
shares of any kind of capital stock into which such class of Common
Stock was exchanged until surrender of such holder's certificate for a
certificate or certificates representing shares of such kind of capital
stock. Upon such surrender, there shall be paid to the holder the
amount of any dividends or other distributions (without interest) which
theretofore became payable with respect to a record date after the
Exchange Date, but that were not paid by reason of the foregoing, with
respect to the number of whole shares of the kind of capital stock
represented by the certificate or certificates issued upon such
surrender. From and after an Exchange Date for any class of Common
Stock, the Corporation shall, however, be entitled to treat the
certificates for such class of Common Stock that have not yet been
surrendered for exchange as evidencing the ownership of the number of
whole shares of the kind or kinds of capital stock for which the shares
of such class of Common Stock represented by such certificates shall
have been exchanged, notwithstanding the failure to surrender such
certificates.
(vii) The Corporation will pay any and all documentary, stamp or
similar issue or transfer taxes that may be payable in respect of the
issue or delivery of any shares of capital stock on exchange of shares
of any class of Common Stock pursuant hereto. The Corporation shall
not, however, be required to pay any tax that may be payable in respect
of any transfer involved in the issue and delivery of any shares of
capital stock in a name other than that in which the shares of the
class of Common Stock so exchanged were registered, and no such issue
or delivery shall be made unless and until the person requesting such
issue has paid to the Corporation the amount of any such tax, or has
established to the satisfaction of the Corporation that such tax has
been paid.
3. Voting Rights.
(a) Except as provided in clauses (c), (d) or (e) below, the holders of
all classes of Common Stock shall vote together as a single class on all
matters as to which holders of Common Stock are entitled to vote. On all
matters to be voted on by the holders of all classes of Common Stock
together as a single class, (i) each outstanding share of Marathon Stock
shall have one vote, (ii) each outstanding share of any other class of
Common Stock shall have a number of votes equal to the quotient
(calculated to the nearest three decimal places), as of the fifth Business
Day prior to the applicable record date or as of any other applicable
date, of (A) the sum of (1) four times the average ratio of X/Y for the
five-Business Day period ending on such fifth Business Day, (2) three
times the average ratio of X/Y for the next preceding five-Business Day
period, (3) two times the average ratio of X/Y for the next preceding five-
Business Day period and (4) the average ratio of X/Y for the next
preceding five-Business Day period, divided by (B) ten, where X is the
Market Value of such class of Common Stock and Y is the Market Value of
the Marathon Stock or if there are no shares of Marathon Stock outstanding
on such record or other applicable date or on any of the twenty-five
Business Days prior thereto, the sum of the Market Values of the Steel
Stock and of the Delhi Stock; provided that until the Delhi Stock has been
traded regular way on the New York Stock Exchange for at least twenty-five
Business Days, each outstanding share of the Delhi Stock shall have a
number of votes equal to the ratio of A/B (calculated to the nearest three
decimal places), where A is the average of the high and low reported sales
prices of a share of the Delhi Stock on the New York Stock Exchange, and B
is the average of the high and low reported sales prices of a share of
Marathon Stock or, if there are no shares of Marathon Stock outstanding,
the sum of the average of the high and low reported sales prices of a
share of the Steel Stock and a share of the Delhi Stock on such Exchange,
in each case on the Effective Date, or on the first Business Day
thereafter on which shares of the Delhi Stock are traded on such Exchange.
If shares of only one class of Common Stock are outstanding, each share of
that class shall have one vote.
(b) Unless the vote or consent of a greater number of shares shall then
be required by law, the vote or consent of the holders of a majority of
all of the shares of any class of Common Stock then outstanding, voting as
a separate class, shall be necessary for authorizing, effecting or
validating the merger or consolidation of the Corporation into or with any
other corporation if such merger or consolidation would adversely affect
the powers or special rights of such class of Common Stock either directly
by amendment of this Restated Certificate of Incorporation or indirectly
by requiring the holders of such class to accept or retain, in such merger
or consolidation, anything other than (i) shares of such class or (ii)
shares of the surviving or resulting corporation having, in either case,
powers and special rights identical to those of such class prior to such
merger or consolidation.
(c) Unless the vote or consent of a greater number of shares shall then
be required by law, the vote or consent of the holders of at least 662/3%
of all of the shares of Steel Stock then outstanding, voting as a separate
class, shall be necessary for:
(i) the declaration or payment of any dividend on, or the making of
any other payment or distribution with respect to any shares of any
other class of Common Stock, if such dividend, payment or distribution
is to be made with (A) proceeds from the Disposition of any of the
properties and assets of the U.S. Steel Group or (B) any portion of an
equity interest in a person, entity or group that owns any of the
properties or assets of the U.S. Steel Group; or
(ii) the use, or reservation for use, of any proceeds from the
Disposition of any of the properties and assets of the U.S. Steel
Group, or any of the properties and assets acquired with such proceeds,
in any business of the Corporation other than a business of the U.S.
Steel Group;
provided such vote shall not be required if such proceeds are loaned at a
rate or rates representative of actual borrowings and short-term
investments by the Corporation.
(d) Unless the vote or consent of a greater number of shares shall then
be required by law, the vote or consent of the holders of at least 662/3%
of all the shares of Marathon Stock then outstanding, voting as a separate
class, shall be necessary for:
(i) the declaration or payment of any dividend on, or the making of
any other payment or distribution with respect to, any shares of any
other class of Common Stock, if such dividend, payment or distribution
is to be made with (A) proceeds from the Disposition of any of the
properties and assets of the Marathon Group or (B) any portion of an
equity interest in a person, entity or group that owns any of the
properties and assets of the Marathon Group; or
(ii) the use, or reservation for use, of any proceeds from the
Disposition of any of the properties and assets of the Marathon Group,
or any of the properties and assets acquired with such proceeds, in any
business of the Corporation other than a business of the Marathon
Group;
provided such vote shall not be required to the extent such proceeds are
loaned at a rate or rates representative of actual borrowings and short-
term investments by the Corporation.
(e) Unless the vote or consent of a greater number of shares shall then
be required by law, the vote or consent of the holders of at least 662/3%
of all of the shares of Delhi Stock then outstanding, voting as a separate
class, shall be necessary for:
(i) the declaration or payment of any dividend on, or the making of
any other payment or distribution with respect to any shares of any
other class of Common Stock, if such dividend, payment or distribution
is to be made with (A) proceeds from the Disposition of any of the
properties and assets of the Delhi Group or (B) any portion of an
equity interest in a person, entity or group that owns any of the
properties or assets of the Delhi Group; or
(ii) the use, or reservation for use, of any proceeds from the
Disposition of any of the properties and assets of the Delhi Group, or
any of the properties and assets acquired with such proceeds, in any
business of the Corporation other than a business of the Delhi Group;
provided such vote shall not be required if such proceeds are loaned at a
rate or rates representative of actual borrowings and short-term
investments by the Corporation.
(f) The number of authorized shares of any class of Common Stock may be
increased or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of shares of Common
Stock having a majority of the votes entitled to be cast by the holders of
all classes of Common Stock, voting together as provided for in Section
3(a) and without a separate vote of the holders of any class.
4. Liquidation Rights. In the event of the dissolution, liquidation or
winding-up of the Corporation, whether voluntary or involuntary, after there
shall have been paid or set apart for the holders of Preferred Stock the full
preferential amounts to which they are entitled, the holders of the
outstanding shares of each class of Common Stock shall be entitled to receive
a fraction of the funds of the Corporation remaining for distribution to its
stockholders, where such fraction is equal to the quotient of (A) the sum of
(1) four times the average ratio of x/y for the five-Business Day period
ending on the Business Day prior to the date of the public announcement of
(I) a voluntary dissolution, liquidation or winding-up by the Corporation or
(II) the institution of the proceeding for the involuntary dissolution,
liquidation or winding-up of the Corporation, (2) three times the average
ratio of x/y for the next preceding five-Business Day period, (3) two times
the average ratio of x/y for the next preceding five-Business Day period and
(4) the average ratio of x/y for the next preceding five-Business Day period,
divided by (B) ten, where x is the Market Capitalization of such class of
Common Stock, and y is the aggregate Market Capitalization of all classes of
Common Stock. For purposes of the preceding sentence, ''Market
Capitalization'' of any class of Common Stock on any day shall mean the
product of (i) the Market Value of such class of Common Stock on such day and
(ii) the number of shares of such class of Common Stock outstanding on such
day.
5. Definitions. As used in this Division I, the following terms shall have
the following meanings (with terms defined in the singular having comparable
meaning when used in the plural and vice versa), unless another definition is
provided or the context otherwise requires:
''Available Delhi Dividend Amount'', on any date, shall mean the product
of the Delhi Fraction and either (a) the greater of (i) an amount equal to
(x) $172.9 million, increased or decreased, as appropriate, to reflect,
from June 30, 1992, (A) Delhi Net Income, (B) any dividends or other
distributions declared or paid with respect to, or repurchases or
issuances of, any shares of Marathon Stock prior to the close of business
on the date Delhi Stock is first issued attributed to the Delhi Group, (C)
any dividends or other distributions declared or paid with respect to, or
repurchases or issuances of, any shares of Delhi Stock or any shares of
Preferred Stock attributed to the Delhi Group, (D) assets or properties of
the Delhi Group that are no longer included as part of the Delhi Group as
a result of any such dividend, distribution or repurchase pursuant to the
proviso to the definition of ''Delhi Group'' and (E) any other adjustments
to stockholders' equity of the Delhi Group made in accordance with
generally accepted accounting principles, less (y) the sum of the
aggregate stated capital of all outstanding Preferred Stock attributed to
the Delhi Group and the quotient of the aggregate par value of all
outstanding Delhi Stock divided by the Delhi Fraction and (ii) the excess
of the fair market value of the net assets of the Delhi Group over the sum
of the aggregate stated capital of all outstanding Preferred Stock
attributed to the Delhi Group, and the quotient of the aggregate par value
of all outstanding Delhi Stock divided by the Delhi Fraction, or (b) in
case there shall be no such amount, an amount equal to Delhi Net Income
(if positive) for the fiscal year in which the dividend is declared and/or
the preceding fiscal year.
''Available Steel Dividend Amount'', on any date, shall mean either (a)
the greater of (i) an amount equal to (x) $2.244 billion, increased or
decreased, as appropriate, to reflect (A) Steel Net Income from the close
of business on December 31, 1990, (B) any dividends or other distributions
declared or paid with respect to, or repurchases or issuances of, any
shares of common stock of the Corporation after December 31, 1990 and
prior to the close of business on May 6, 1991 attributed to the U.S. Steel
Group, (C) any dividends or other distributions declared or paid with
respect to, or repurchases or issuances of, any shares of Steel Stock or
any shares of Preferred Stock attributed to the U.S. Steel Group and (D)
any other adjustments to stockholders' equity of the U.S. Steel Group made
in accordance with generally accepted accounting principles, less (y) the
sum of the aggregate par value of all outstanding Steel Stock and the
aggregate stated capital of all outstanding Preferred Stock attributed to
the U.S. Steel Group and (ii) the excess of the fair market value of the
net assets of the U.S. Steel Group over the sum of the aggregate par value
of all outstanding Steel Stock and the aggregate stated capital of all
outstanding Preferred Stock attributed to the U.S. Steel Group, in the
case of each of clause (i) and clause (ii) increased by an amount equal to
any effects of the recognition of the transition obligation upon the
adoption of Statement of Financial Accounting Standards (SFAS) No. 106,
''Employer's Accounting for Postretirement Benefits Other than Pensions''
(including any amendments thereto) and any cumulative effects of the
adoption of SFAS No. 109, ''Accounting for Income Taxes'' (including any
amendments thereto) in the year of adoption or (b) in case there shall be
no such amount, an amount equal to Steel Net Income (if positive) for the
fiscal year in which the dividend is declared and/or the preceding fiscal
year.
''Business Day'' shall mean each weekday other than any day on which any
relevant class of Common Stock is not traded on any national securities
exchange or the National Association of Securities Dealers Automated
Quotations National Market System or in the over-the-counter market.
''Convertible Securities'' shall mean any securities of the Corporation
that are convertible into or evidence the right to purchase any shares of
any class of Common Stock, pursuant to antidilution provisions of such
securities or otherwise.
The ''Delhi Fraction'' as of any date is a fraction the numerator of
which shall be the number of shares of Delhi Stock outstanding on such
date and the denominator of which shall be initially 14,000,000 provided
that such fraction shall in no event be greater than one. The denominator
of the Delhi Fraction shall be adjusted from time to time as appropriate
to reflect (i) subdivisions (by stock split or otherwise) and combinations
(by reverse stock split or otherwise) of the Delhi Stock and stock
dividends payable in shares of Delhi Stock to holders of Delhi Stock and
other reclassifications of Delhi Stock, (ii) the issuance of Delhi Stock,
the proceeds of which are attributed to the Delhi Group and (iii)
repurchases by the Corporation of outstanding shares of Delhi Stock.
''Delhi Group'' shall mean, (i) all of the businesses in which any of
Delhi Gas Pipeline Corporation, The Nueces Company, Delhi Gasmark, Inc.
(previously Texas Gasmark, Inc.), Tonkawa Gas Processing Company, Delhi
Gas Marketing Corp. (previously TXO Gas Marketing Corp.), Delhi Gas
Ventures Corp. (previously TXO Gas Ventures Corp.), Red River Gas Pipeline
Corporation, Ozark Gas Pipeline Corporation, Sweetwater Pipeline
Corporation, Western Gas Transmission, Inc., and Western Gas Corporation
(or any of their predecessors or successors) is or has been engaged,
directly or indirectly, (ii) all assets and liabilities of the Corporation
to the extent attributed to any of such businesses, whether or not such
assets or liabilities are or were assets and liabilities of such
companies, and (iii) such businesses, assets and liabilities acquired by
the Corporation for the Delhi Group as determined by the Board of
Directors to be included in the Delhi Group; provided that, from and after
any dividend or distribution with respect to any shares of Delhi Stock, or
any repurchase of shares of Delhi Stock from holders of Delhi Stock
generally, the Delhi Group shall no longer include an amount of assets or
properties of the Delhi Group equal to the aggregate amount of such kind
of assets or properties so paid in respect of shares of Delhi Stock
multiplied by a fraction, the numerator of which is equal to one less the
Delhi Fraction and the denominator of which is equal to the Delhi
Fraction. From and after the date on which all of the outstanding shares
of Steel Stock are exchanged for shares of Delhi Stock pursuant to any
provision of Section 2, all of the businesses, assets and liabilities of
the U.S. Steel Group shall be included in the Delhi Group.
''Delhi Group Subsidiary'' shall have the meaning set forth in Section
2(c)(v).
''Delhi Net Income'' shall mean the net income or loss of the Delhi
Group determined in accordance with generally accepted accounting
principles, including income and expenses of the Corporation attributed to
the operations of the Delhi Group on a substantially consistent basis,
including, without limitation, corporate administrative costs, net
interest and other financial costs and income taxes.
''Disposition'' shall mean the sale, transfer, assignment or other
disposition (whether by merger, consolidation, sale or contribution of
assets or stock or otherwise) of properties or assets.
''Exchange Date'' shall mean any date fixed for an exchange of shares of
any class of Common Stock, as set forth in a notice to holders of such
class of Common Stock pursuant to Section 2(d)(i).
''Marathon Group'' shall mean, at any time, (i) all of the businesses in
which any of Marathon Oil Company, Texas Oil & Gas Corp., Carnegie Natural
Gas Company and Apollo Gas Company (or any of their predecessors or
successors) is or has been engaged, directly or indirectly, other than the
businesses of the Delhi Group after the date of the first issuance of
Delhi Stock, (ii) all assets and liabilities of the Corporation to the
extent attributed to any of such businesses, whether or not such assets or
liabilities are or were assets and liabilities of such companies, (iii) a
proportionate interest in the business, assets and liabilities of the
Delhi Group equal to one less the Delhi Fraction, and (iv) such
businesses, assets, and liabilities acquired by the Corporation for the
Marathon Group after May 6, 1991 and as determined by the Board of
Directors to be included in the Marathon Group; provided that, from and
after any dividend or distribution with respect to any shares of Delhi
Stock, or any repurchase of shares of Delhi Stock from holders of Delhi
Stock generally, the Marathon Group shall include an amount of assets or
properties of the Delhi Group equal to the aggregate amount of such kind
of assets or properties so paid in respect of shares of Delhi Stock
multiplied by a fraction, the numerator of which is equal to one less the
Delhi Fraction and the denominator of which is equal to the Delhi
Fraction. From and after the date on which there are no shares of Steel
Stock outstanding (other than as a result of an exchange for shares of
Delhi Stock pursuant to any provision of Section 2), all of the
businesses, assets and liabilities of the U.S. Steel Group shall be
included in the Marathon Group.
''Marathon Group Subsidiary'' shall have the meaning set forth in
Section 2(a)(i).
''Market Value'' of any class of capital stock of the Corporation on any
Business Day shall mean the average of the high and low reported sales
prices regular way of a share of such class on such Business Day or in
case no such reported sale takes place on such Business Day the average of
the reported closing bid and asked prices regular way of a share of such
class on such Business Day, in either case on the New York Stock Exchange
Composite Tape, or if the shares of such class are not listed or admitted
to trading on such Exchange on such Business Day, on the principal
national securities exchange in the United States on which the shares of
such class are listed or admitted to trading, or if not listed or admitted
to trading on any national securities exchange on such Business Day, on
the National Association of Securities Dealers Automated Quotations
National Market System, or if the shares of such class are not listed or
admitted to trading on any national securities exchange or quoted on such
National Market System on such Business Day, the average of the closing
bid and asked prices of a share of such class in the over-the-counter
market on such Business Day as furnished by any New York Stock Exchange
member firm selected from time to time by the Corporation, or if such
closing bid and asked prices are not made available by any such New York
Stock Exchange member firm on such Business Day, the market value of a
share of such class as determined by the Board of Directors; provided that
(i) for purposes of determining the ratios set forth in Sections 2(b)(i),
2(b)(ii), 2(c)(i), 2(c)(ii), 2(c)(iii), 3(a) and 4, the ''Market Value''
of any share of any class of Common Stock on any day prior to the ''ex''
date or any similar date for any dividend or distribution paid or to be
paid with respect to such class of Common Stock (other than a regular
quarterly cash dividend or a dividend or distribution in shares of such
class of Common Stock) shall be reduced by the fair market value of the
per share amount of such dividend or distribution and (ii) for purposes of
determining the ratios set forth in Sections 2(b)(i), 2(b)(ii), 2(c)(i),
2(c)(ii), 2(c)(iii) and 3(a), the ''Market Value'' of any share of any
class of Common Stock on any day prior to (A) the effective date of any
subdivision (by stock split or otherwise) or combination (by reverse stock
split or otherwise) of outstanding shares of such class of Common Stock or
(B) the ''ex'' date or any similar date for any dividend or distribution
with respect to either such class of Common Stock in shares of such class
of Common Stock shall be appropriately adjusted to reflect such
subdivision, combination, dividend or distribution. For the purposes of
the foregoing clause (i) the Board of Directors shall determine the fair
market value of any dividend or distribution.
''Net Proceeds'', as of any date, from any Disposition of any of the
properties and assets of the U.S. Steel Group or the Delhi Group, as the
case may be, shall mean an amount, if any, equal to the gross proceeds of
such Disposition after any payment of, or reasonable provision for, (i)
any taxes payable by the Corporation in respect of such Disposition, (ii)
any taxes payable by the Corporation in respect of any dividend or
redemption pursuant to clause (A) or (B), respectively, of Sections
2(b)(i) or 2(c)(i), respectively, (iii) any transaction costs, including,
without limitation, any legal, investment banking and accounting fees and
expenses and (iv) any liabilities (contingent or otherwise) of, or
allocated to, the U.S. Steel Group or the Delhi Group, as the case may be,
including, without limitation, any indemnity obligations incurred in
connection with the Disposition. For purposes of this definition, any
properties and assets of the Steel Group or the Delhi Group, as the case
may be, remaining after such Disposition shall constitute ''reasonable
provision'' for such amount of taxes, costs and liabilities (contingent or
otherwise) as can be supported by such properties and assets. To the
extent the proceeds of any Disposition include any securities or other
property other than cash, the Board of Directors shall determine the value
of such securities or property.
''Redemption Date'' shall mean any date fixed for a redemption of shares
of any class of Common Stock, as set forth in a notice to holders of such
class of Common Stock pursuant to Section 2(d)(i).
''Steel Net Income'' shall mean the net income or loss of the U.S. Steel
Group determined in accordance with generally accepted accounting
principles, including income and expenses of the Corporation attributed to
the operations of the Steel Group on a substantially consistent basis,
including, without limitation, corporate administrative costs, net
interest and other financial costs and income taxes.
''U.S. Steel Group'' shall mean, at any time, all of the businesses in
which the Corporation is or has been engaged, directly or indirectly, and
all assets and liabilities of the Corporation, other than any businesses,
assets or liabilities of the Marathon Group or the Delhi Group if any
shares of Marathon Stock or Delhi Stock are outstanding.
''U.S. Steel Group Subsidiary'' shall have the meaning set forth in
Section 2(b)(iii).
6. Determinations by the Board of Directors. Any determinations made by the
Board of Directors of the Corporation under any provision in this Division I
of Article Fourth shall be final and binding on all stockholders of the
Corporation.
DIVISION II
A statement of the designations of the Preferred Stock or of any series
thereof, and the powers, preferences and relative, participating, optional or
other special rights, and qualifications, limitations or restrictions thereof,
or of the authority of the Board of Directors to fix by resolution or
resolutions such designations and other terms not fixed by the Certificate of
Incorporation, is as follows:
1. The Preferred Stock may be issued in one or more series, from time to
time, with each such series to have such designation, powers, preferences and
relative, participating, optional or other special rights, and
qualifications, limitations or restrictions thereof, as shall be stated and
expressed in the resolution or resolutions providing for the issue of such
series adopted by the Board of Directors of the Corporation, subject to the
limitations prescribed by law and in accordance with the provisions hereof,
the Board of Directors being hereby expressly vested with authority to adopt
any such resolution or resolutions. The authority of the Board of Directors
with respect to each such series shall include, but not limited to, the
determination or fixing of the following:
(i) The distinctive designation and number of shares comprising such
series, which number may (except where otherwise provided by the Board
of Directors in creating such series) be increased or decreased (but
not below the number of shares then oustanding) from time to time by
like action of the Board of Directors;
(ii) The dividend rate of such series, the conditions and times upon
which such dividends shall be payable, the relation which such
dividends shall bear to the dividends payable on any other class or
classes of stock or series thereof, or any other series of the same
class, and whether dividends shall be cumulative or non-cumulative;
(iii) The conditions upon which the shares of such series shall be
subject to redemption by the Corporation and the times, prices and
other terms and provisions upon which the shares of the series may be
redeemed;
(iv) Whether or not the shares of the series shall be subject to the
operation of a retirement or sinking fund to be applied to the purchase
or redemption of such shares and, if such retirement or sinking fund be
established, the annual amount thereof and the terms and provisions
relative to the operation thereof;
(v) Whether or not the shares of the series shall be convertible into
or exchangeable for shares of any other class or classes, with or
without par value, or of any other series of the same class, and, if
provision is made for conversion or exchange, the times, prices, rates,
adjustments, and other terms and conditions of such conversion or
exchange;
(vi) Whether or not the shares of the series shall have voting
rights, in addition to the voting rights provided by law, and, if so,
subject to the limitation hereinafter set forth, the terms of such
voting rights;
(vii) The rights of the shares of the series in the event of
voluntary or involuntary liquidation, dissolution, or upon the
distribution of assets of the Corporation;
(viii) Any other powers, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof, of the shares of such series, as the Board of
Directors may deem advisable and as shall not be inconsistent with the
provisions of this Certificate of Incorporation.
2. The holders of shares of the Preferred Stock of each series shall be
entitled to receive, when and as declared by the Board of Directors, out of
funds legally available for the payment of dividends, dividends at the rates
fixed by the Board of Directors for such series, and no more, before any
dividends, other than dividends payable in Common Stock, shall be declared
and paid, or set apart for payment, on the Common Stock with respect to the
same dividend period.
3. Whenever, at any time, dividends on the then outstanding Preferred Stock
as may be required with respect to any series outstanding shall have been
paid or declared and set apart for payment on the then outstanding Preferred
Stock, and after complying with respect to any retirement or sinking fund or
funds for any series of Preferred Stock, the Board of Directors may, subject
to the provisions of the resolution or resolutions creating any series of
Preferred Stock, declare and pay dividends on the Common Stock, and the
holders of shares of the Preferred Stock shall not be entitled to share
therein.
4. The holders of shares of the Preferred Stock of each series shall be
entitled upon liquidation or dissolution or upon the distribution of the
assets of the Corporation to such preferences as provided in the resolution
or resolutions creating such series of Preferred Stock, and no more, before
any distribution of the assets of the Corporation shall be made to the
holders of shares of the Common Stock.
5. Except as otherwise provided by a resolution or resolutions of the Board
of Directors creating any series of Preferred Stock or by the General
Corporation Law of Delaware, the holders of shares of the Common Stock issued
and outstanding shall have and possess the exclusive right to notice of
stockholders' meetings and the exclusive power to vote. The holders of shares
of the Preferred Stock issued and outstanding shall, in no event, be entitled
to more than one vote for each share of Preferred Stock held by them unless
otherwise required by law.
Terms of the Preferred Stocks are as follows:
Series A Junior Preferred Stock
Section 1. Designation and Amount. This resolution shall provide for a
single series of preferred stock, the designation of which shall be ''Series
A Junior Preferred Stock'', without par value, and the number of shares
constituting such series shall be Eight Million (8,000,000).
Section 2. Dividends and Distributions.
(A) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Stock ranking prior and superior to the
shares of Series A Junior Preferred Stock with respect to dividends, the
holders of shares of Series A Junior Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors out of funds
legally available for the purpose, quarterly dividends payable in cash on
the first day of March, June, September and December in each year (each
such date being referred to herein as a ''Quarterly Dividend Payment
Date''), commencing on the first Quarterly Dividend Payment Date after the
first issuance of a share or fraction of a share of Series A Junior
Preferred Stock, in an amount per share (rounded to the nearest cent)
equal to the greater of (a) $5.00 or (b) subject to the provision for
adjustment hereinafter set forth, 100 times the aggregate per share amount
of all cash dividends, and 100 times the aggregate per share amount
(payable in kind) of all non-cash dividends or other distributions other
than a dividend payable in shares of Common Stock or a subdivision of the
outstanding shares of Common Stock (by reclassification or otherwise), to
be or being declared on the Common Stock, par value $1.00 per share, of
the Corporation (the ''Common Stock'') with respect to the same dividend
period. If the Quarterly Dividend Payment Date is a Saturday, Sunday or
legal holiday then such Quarterly Dividend Payment Date shall be the first
immediately preceding calendar day which is not a Saturday, Sunday or
legal holiday. In the event the Corporation shall at any time after
October 10, 1989 (the ''Rights Declaration Date'') (i) declare any
dividend on Common Stock payable in shares of Common Stock, (ii) subdivide
the outstanding Common Stock, or (iii) combine the outstanding Common
Stock into a smaller number of shares, then in each such case the amount
to which holders of shares of Series A Junior Preferred Stock were
entitled immediately prior to such event under clause (b) of the preceding
sentence shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such
event.
(B) The Corporation shall declare a dividend or distribution on the
Series A Junior Preferred Stock as provided in paragraph (A) above
immediately prior to the time it declares a dividend or distribution on
the Common Stock (other than a dividend payable in shares of Common
Stock); provided that, in the event no dividend or distribution shall be
declared on the Common Stock with respect to a particular dividend period,
a dividend of $5.00 per share on the Series A Junior Preferred Stock shall
nevertheless be payable on such Quarterly Dividend Payment Date with
respect to such quarterly period.
(C) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Junior Preferred Stock from the Quarterly Dividend
Payment Date next preceding the date of issue of such shares of Series A
Junior Preferred Stock, unless the date of issue of such shares is prior
to the record date for the first Quarterly Dividend Payment Date, in which
case dividends on such shares shall begin to accrue from the date of issue
of such shares, or unless the date of issue is a Quarterly Dividend
Payment Date or is a date after the record date for the determination of
holders of shares of Series A Junior Preferred Stock entitled to receive a
quarterly dividend and before such Quarterly Dividend Payment Date, in
either of which events such dividends shall begin to accrue and be
cumulative from such Quarterly Dividend Payment Date. Accrued but unpaid
dividends shall not bear interest. Dividends paid on the shares of Series
A Junior Preferred Stock in an amount less than the total amount of such
dividends at the time accrued and payable on such shares shall be
allocated pro rata on a share-by-share basis among all such shares at the
time outstanding. The Board of Directors may fix a record date for the
determination of holders of shares of Series A Junior Preferred Stock
entitled to receive payment of a dividend or distribution declared
thereon, which record date shall be no more than 30 days prior to the date
fixed for the payment thereof. Dividends in arrears may be declared and
paid at any time, without reference to any Quarterly Dividend Payment
Date, to holders of record on such date, not exceeding 45 days preceding
the payment date thereof, as may be fixed by the Board of Directors.
(D) Except as hereinafter provided, no dividends shall be declared or
paid or set apart for payment on the shares of Series A Junior Preferred
Stock for any period if the Corporation shall be in default in the payment
of any dividends (including cumulative dividends, if applicable) on any
shares of Preferred Stock ranking, as to dividends, prior to the Series A
Junior Preferred Stock, unless the same shall be contemporaneously
declared and paid.
(E) Dividends payable on the Series A Junior Preferred Stock for the
initial dividend period and for any period less than a full quarterly
period, shall be computed on the basis of a 360-day year of 30-day months.
Section 3. Voting Rights. The holders of shares of Series A Junior
Preferred Stock shall have the following voting rights:
(A) Each share of Series A Junior Preferred Stock shall entitle the
holder thereof to one vote on all matters submitted to a vote of the
stockholders of the Corporation. The holders of Series A Junior Preferred
Stock shall be entitled to notice of all meetings of the stockholders of
the Corporation.
(B) Except as otherwise provided herein or by law, the holders of shares
of Series A Junior Preferred Stock and the holders of shares of Common
Stock shall vote together as one class on all matters submitted to a vote
of stockholders of the Corporation.
(C) If, on the date used to determine stockholders of record for any
meeting of stockholders for the election of directors, a default in
preference dividends on the Preferred Stock shall exist, the number of
directors constituting the Board of Directors of the Corporation shall be
increased by two, and the holders of the Preferred Stock of all series
(whether or not the holders of such series of Preferred Stock would be
entitled to vote for the election of directors if such default in
preference dividends did not exist), shall have the right at such meeting,
voting together as a single class without regard to series, to the
exclusion of the holders of Common Stock, to elect two directors of the
Corporation to fill such newly created directorships. Each director
elected by the holders of shares of Preferred Stock (herein called a
''Preferred Director''), shall continue to serve as such director for the
full term for which he shall have been elected, notwithstanding that prior
to the end of such term a default in preference dividends shall cease to
exist. Any Preferred Director may be removed by, and shall not be removed
except by, the vote of the holders of record of the outstanding shares of
Preferred Stock, voting together as a single class without regard to
series, at a meeting of the stockholders, or of the holders of shares of
Preferred Stock, called for the purpose. So long as a default in any
preference dividends on the Preferred Stock shall exist (i) any vacancy in
the office of a Preferred Director may be filled (except as provided in
the following clause (ii)) by an instrument in writing signed by the
remaining Preferred Director and filed with the Corporation and (ii) in
the case of the removal of any Preferred Director, the vacancy may be
filled by the vote of the holders of the outstanding shares of Preferred
Stock, voting together as a single class without regard to series, at the
same meeting at which such removal shall be voted. Each director appointed
as aforesaid by the remaining Preferred Director shall be deemed, for all
purposes hereof, to be a Preferred Director. Whenever the term of office
of the Preferred Directors shall end and no default in preference
dividends shall exist, the number of directors constituting the Board of
Directors of the Corporation shall be reduced by two. For the purposes of
this paragraph (C), a ''default in preference dividends'' on the Preferred
Stock shall be deemed to have occurred whenever the amount of accrued and
unpaid dividends upon any series of the Preferred Stock shall be
equivalent to six full quarterly dividends or more, and, having so
occurred, such default shall be deemed to exist thereafter until, but only
until, all accrued dividends on all shares of Preferred Stock of each and
every series then outstanding shall have been paid through the last
Quarterly Dividend Payment Date.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Junior Preferred Stock as provided in Section 2
are in arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A Junior
Preferred Stock outstanding shall have been paid in full, the Corporation
shall not:
(i) declare or pay dividends on, make any other distributions on
(other than a dividend in Common Stock or in any other stock of the
Corporation ranking junior to the Series A Junior Preferred Stock as to
dividends and upon liquidation, dissolution or winding up and other
than as provided in subparagraph (ii) of this section), or redeem or
purchase or otherwise acquire for consideration (except by conversion
into or exchange for stock of the Corporation ranking junior to the
Series A Junior Preferred Stock as to dividends and upon dissolution,
liquidation or winding up), any shares of stock ranking junior (either
as to dividends or upon liquidation, dissolution or winding up) to the
Series A Junior Preferred Stock;
(ii) declare or pay dividends on or make any other distributions on
any shares of stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Junior
Preferred Stock, except dividends paid ratably on the Series A Junior
Preferred Stock and all stock ranking on a parity with the Series A
Junior Preferred Stock as to dividends on which dividends are payable
or in arrears in proportion to the total amounts to which the holders
of all such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for consideration
shares of any stock ranking on a parity (either as to dividends or upon
liquidation, dissolution or winding up) with the Series A Junior
Preferred Stock, provided that the Corporation may at any time redeem,
purchase or otherwise acquire shares of any such parity stock in
exchange for shares of any stock of the Corporation ranking junior (as
to dividends and upon dissolution, liquidation or winding up) to the
Series A Junior Preferred Stock;
(iv) purchase or otherwise acquire for consideration any shares of
Series A Junior Preferred Stock, except in accordance with a purchase
offer made in writing or by publication (as determined by the Board of
Directors) to all holders of such shares upon such terms as the Board
of Directors, after consideration of the respective annual dividend
rates and other relative rights and preferences of the respective
series and classes, shall determine in good faith will result in fair
and equitable treatment among the respective series or classes.
(B) The Corporation shall not permit any subsidiary of the Corporation
to purchase or otherwise acquire for consideration any shares of stock of
the Corporation unless the Corporation could, under paragraph (A) of this
Section 4, purchase or otherwise acquire such shares at such time and in
such manner.
Section 5. Reacquired Shares. Any shares of Series A Junior Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and cancelled promptly after the acquisition thereof. All
such shares shall upon their cancellation become authorized but unissued
shares of Preferred Stock and may be reissued as part of a new series of
Preferred Stock to be created by resolution or resolutions of the Board of
Directors, subject to the conditions and restrictions on issuance set forth
herein.
Section 6. Liquidation, Dissolution or Winding Up.
(A) In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the holders of the Series A
Junior Preferred Stock shall be entitled to receive the greater of (a)
$100 per share, plus accrued dividends to the date of distribution,
whether or not earned or declared, or (b) an amount per share, subject to
the provision for adjustment hereinafter set forth, equal to 100 times the
aggregate amount to be distributed per share to holders of Common Stock
(the ''Series A Liquidation Preference''). In the event the Corporation
shall at any time after the Rights Declaration Date (i) declare any
dividend on Common Stock payable in shares of Common Stock, (ii) subdivide
the outstanding Common Stock or (iii) combine the outstanding Common Stock
into a smaller number of shares, then in each such case the amount to
which holders of shares of Series A Junior Preferred Stock were entitled
immediately prior to such event pursuant to clause (b) of the preceding
sentence shall be adjusted by multiplying such amount by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such
event.
(B) In the event, however, that there are not sufficient assets
available to permit payment in full of the Series A Liquidation Preference
and the liquidation preferences of all other series of preferred stock, if
any, which rank on a parity with the Series A Junior Preferred Stock, then
such remaining assets shall be distributed ratably to the holders of such
parity shares in proportion to their respective liquidation preferences.
Section 7. Consolidation, Merger, etc. In case the Corporation shall enter
into any consolidation, merger, combination or other transaction in which the
shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares
of Series A Junior Preferred Stock shall at the same time be similarly
exchanged or changed in an amount per share (subject to the provision for
adjustment hereinafter set forth) equal to 100 times the aggregate amount of
stock, securities, cash and/or any other property (payable in kind), as the
case may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the Corporation shall at any time after the Rights
Declaration Date (i) declare any dividend on Common Stock payable in shares
of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the amount set forth in the preceding sentence with respect to
the exchange or change of shares of Series A Junior Preferred Stock shall be
adjusted by multiplying such amount by a fraction the numerator of which is
the number of shares of Common Stock outstanding immediately after such event
and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
Section 8. Optional Redemption.
(A) The Corporation shall have the option to redeem the whole or any
part of the Series A Junior Preferred Stock at any time on at least 30
days notice in accordance with the provisions of paragraph (B) of this
Section 8 at a redemption price equal to, subject to the provision for
adjustment hereinafter set forth, 100 times the ''current per share market
price'' of the Common Stock on the date of the mailing of the notice of
redemption, together with unpaid accumulated dividends to the date of such
redemption. In the event the Corporation shall at any time after October
10, 1989 (i) declare any dividend on Common Stock payable in shares of
Common Stock, (ii) subdivide the outstanding Common Stock or (iii) combine
the outstanding Common Stock into a smaller number of shares, then in each
such case the amount to which holders of shares of Series A Junior
Preferred Stock were otherwise entitled immediately prior to such event
under the preceding sentence shall be adjusted by multiplying such amount
by a fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of
which is the number of shares of Common Stock that were outstanding
immediately prior to such event. The ''current per share market price'' on
any date shall be deemed to be the average of the closing price per share
of such Common Stock for the 10 consecutive Trading Days (as such term is
hereinafter defined) immediately prior to such date. The closing price for
each day shall be the last sale price, regular way, or, in case no such
sale takes place on such day, the average of the closing bid and asked
prices regular way, in either cases as reported in the principal
consolidated transaction reporting system with respect to securities
listed or admitted to trading on the New York Stock Exchange or, if the
Common Stock is not listed or admitted to trading on the New York Stock
Exchange, as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the
principal national securities exchange on which the Common Stock is listed
or admitted to trading or, if the Common Stock is not listed or admitted
to trading on any national securities exchange, the last quoted price or,
if not so quoted the average of the high bid and low asked prices in the
over-the-counter market, as reported by the National Association of
Securities Dealers, Inc. Automated Quotations System (''NASDAQ'') or such
other system then in use or, if on any such date the Common Stock is not
quoted by any such organization, the average of the closing bid and asked
prices as furnished by a professional market maker making a market in the
Common Stock selected by the Corporation. If on such date no such market
maker is making a market in the Common Stock, the fair value of the Common
Stock on such date as determined in good faith by the Board of Directors
of the Corporation shall be used. The term ''Trading Day'' shall mean a
day on which the principal national securities exchange on which the
Common Stock is listed or admitted to trading is open for the transaction
of business or, if the Common Stock is not listed or admitted to trading
on any national securities exchange, a Monday, Tuesday, Wednesday,
Thursday or Friday on which banking institutions in the State of New York
are not authorized or obligated by law or executive order to close.
(B) Whenever shares of Series A Junior Preferred Stock are to be
redeemed, the Corporation shall mail a notice (''Notice of Redemption'')
by first-class mail, postage prepaid, to each holder of record of shares
of Series A Junior Preferred Stock to be redeemed and to the transfer
agent for the Series A Junior Preferred Stock. The Notice of Redemption
shall be addressed to the holder at the address of the holder appearing on
the stock transfer books of the Corporation maintained by the transfer
agent for the Series A Junior Preferred Stock. The Notice of Redemption
shall include a statement of (i) the redemption date, (ii) the redemption
price, (iii) the number of shares of Series A Junior Preferred Stock to be
redeemed, (iv) the place or places where shares of the Series A Junior
Preferred Stock are to be surrendered for payment of the redemption price,
(v) that the dividends on the shares to be redeemed will cease to accrue
on such redemption date, and (vi) the provision under which redemption is
made. No defect in the Notice of Redemption or in the mailing thereof
shall affect the validity of the redemption proceedings, except as
required by law. From the date on which a Notice of Redemption shall have
been given as aforesaid and the Corporation shall have deposited with the
transfer agent for the Series A Junior Preferred Stock a sum sufficient to
redeem the shares of Series A Junior Preferred Stock as to which Notice of
Redemption has been given, with irrevocable instructions and authority to
pay the redemption price to the holders thereof, or if no such deposit is
made, then upon such date fixed for redemption (unless the Corporation
shall default in making payment of the redemption price), all rights of
the holders thereof as stockholders of the Corporation by reason of the
ownership of such shares (except their right to receive the redemption
price thereof, but without interest), shall terminate including, but not
limited to, their right to receive dividends, and such shares shall no
longer be deemed outstanding. The Corporation shall be entitled to
receive, from time to time, from the transfer agent for Series A Junior
Preferred Stock the interest, if any, on such monies deposited with it and
the holders of any shares so redeemed shall have no claim to any such
interest. In case the holder of any shares so called for redemption shall
not claim the redemption price for his shares within one year after the
date of redemption, the transfer agent for the Series A Junior Preferred
Stock shall, upon demand, pay over to the Corporation such amount
remaining on deposit and the transfer agent for the Series A Junior
Preferred Stock shall thereupon be relieved of all responsibility to the
holders of such shares and such holder of the shares of the Series A
Junior Preferred Stock so called for redemption shall look only to the
Corporation for the payment thereof.
(C) In the event that fewer than all the outstanding shares of the
Series A Junior Preferred Stock are to be redeemed, the number of shares
to be redeemed shall be determined by the Board of Directors and the
shares to be redeemed shall be determined by lot or pro rata as may be
determined by the Board of Directors or by any other method as may be
determined by the Board of Directors in its sole discretion to be
equitable.
(D) If the Corporation shall be in default in the payment of any
dividends (including cumulative dividends, if applicable) on any shares of
Preferred Stock ranking, as to dividends, prior to the Series A Junior
Preferred Stock, then no shares of the Series A Junior Preferred Stock
shall be redeemed and the Corporation shall not purchase or otherwise
acquire any shares of the Series A Junior Preferred Stock.
Section 9. Ranking.
(A) The Series A Junior Preferred Stock shall rank junior to all other
series of the Corporation's Preferred Stock as to the payment of dividends
and the distribution of assets upon liquidation, dissolution or winding
up, unless the terms of any such series shall provide otherwise.
(B) For purposes of this resolution, any stock of any class or classes
of the Corporation shall be deemed to rank:
(i) prior to the shares of the Series A Junior Preferred Stock,
either as to dividends or upon liquidation, dissolution or winding up,
if the holders of such class or classes shall be entitled to the
receipt of dividends or of amounts distributable upon dissolution,
liquidation or winding up of the Corporation, whether voluntary or
involuntary, as the case may be, in preference or priority to the
holders of shares of the Series A Junior Preferred Stock. Each holder
of any share of the Series A Junior Preferred Stock, by his acceptance
thereof, expressly covenants and agrees that the rights of the holders
of any shares of any other series of Preferred Stock of the Corporation
to receive dividends or amounts distributable upon dissolution,
liquidation or winding up of the Corporation, whether voluntary or
involuntary, shall be and hereby are expressly prior to his rights
unless in the case of any particular series of Preferred Stock the
certificate or other instrument creating or evidencing the same
expressly provides that the rights of the holders of such series shall
not be prior to the shares of the Series A Junior Preferred Stock; and
(ii) on a parity with shares of the Series A Junior Preferred Stock,
either as to dividends or upon liquidation, whether or not the dividend
rates, dividend payment dates or redemption or liquidation prices per
share or sinking fund provisions, if any, be different from those of
the Series A Junior Preferred Stock, if the holders of such stock shall
be entitled to the receipt of dividends or of amounts distributable
upon dissolution, liquidation or winding up of the Corporation, whether
voluntary or involuntary, as the case may be, in proportion to their
respective dividend rates or liquidation prices, without preference or
priority, one over the other, as between the holders of such stock and
the holders of shares of the Series A Junior Preferred Stock; and
(iii) junior to shares of the Series A Junior Preferred Stock, either
as to dividends or upon liquidation, if such class or classes shall be
Common Stock or if the holders of shares of the Series A Junior
Preferred Stock shall be entitled to receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, as the case may be, in
preference or priority to the holders of shares of such class or
classes.
Section 10. Amendment. Except as otherwise set forth in this Certificate of
Designation, Preferences and Rights with respect to the Series A Junior
Preferred Stock, holders of Series A Junior Preferred Stock shall not have
any special powers and their consent shall not be required for taking any
corporate action, provided, however, that:
(A) Unless the vote or consent of the holders of a greater number of
shares shall then be required by law, the consent of the holders of at
least 662/3% of all of the shares of the Series A Junior Preferred Stock
at the time outstanding, given in person or by proxy, either in writing or
by a vote at a meeting called for the purpose at which the holders of
shares of the Series A Junior Preferred Stock shall vote together as a
separate class, shall be necessary for authorizing, effecting or
validating the amendment, alteration or repeal of any of the provisions of
the Restated Certificate of Incorporation or of any certificate amendatory
thereof or supplemental thereto (including any Certificate of Designation,
Preferences and Rights or any similar document relating to any series of
Preferred Stock) so as to affect adversely the powers, preferences, or
rights, of this Series A Junior Preferred Stock. The increase of the
authorized amount of the Preferred Stock, or the creation, authorization
or issuance of any shares of any other class of stock of the Corporation
ranking prior to or on a parity with the shares of the Series A Junior
Preferred Stock as to dividends or upon liquidation, or the
reclassification of any authorized or outstanding stock of the Corporation
into any such prior or parity shares, or the creation, authorization or
issuance of any obligation or security convertible into or evidencing the
right to purchase any such prior or parity shares shall not be deemed to
affect adversely the powers, preferences or rights of the Series A Junior
Preferred Stock.
Section 11. Fractional Shares. Series A Junior Preferred Stock may be
issued in fractions of a share which shall entitle the holder, in proportion
to such holder's fractional shares, to exercise voting rights, receive
dividends, participate in distributions and to have the benefit of all other
rights of holders of Series A Junior Preferred Stock.
6.50% Cumulative Convertible Preferred Stock
(Without Par Value)
1. Designation. This resolution shall provide for a single series of
Preferred Stock, the designation of which shall be ''6.50% Cumulative
Convertible Preferred Stock'', without par value (hereinafter called this
''Series''), and the number of authorized shares constituting this Series is
3,000,000. Shares of this Series shall have a stated value of $1.00 per share
(which shall also be the stated capital of each share). The number of
authorized shares of this Series may be reduced by further resolution adopted
by the Board of Directors and by the filing of a certificate pursuant to the
provisions of the General Corporation Law of the State of Delaware stating
that such reduction has been so authorized, but the number of authorized
shares of this Series shall not be so increased.
2. Dividends.
(a) The holders of shares of this Series shall be entitled to receive
dividends payable in cash at a rate of 6.50% per annum per share on the
initial liquidation preference of $50.00 per share. Such dividends shall
be cumulative from the date of original issue of such shares, and shall be
payable, when, as and if declared by the Board of Directors, out of funds
legally available for such purpose, on the last calendar day of March,
June, September and December of each year, commencing June 30, 1993,
except that if such date is a Saturday, Sunday or legal holiday, then such
dividend shall be payable on the first immediately preceding calendar day
which is not a Saturday, Sunday or legal holiday.
(b) Each dividend on shares of this Series shall be paid to the holders
of record of such shares as they appear on the stock transfer books of the
Corporation on such record date, not exceeding 30 days preceding the
payment date thereof, as shall be fixed by the Board of Directors.
Dividends in arrears for any past dividend period or any part thereof may
be declared and paid at any time, without reference to any regular
dividend payment date, to holders of record on such date, not exceeding 45
days preceding the payment date thereof, as may be fixed by the Board of
Directors.
(c) Except as hereinafter provided, no dividends shall be declared or
paid or set apart for payment on the Preferred Stock of any series
ranking, as to dividends, on a parity with or junior to this Series for
any period unless full cumulative dividends have been or contemporaneously
are declared and paid on this Series for all past dividend periods. When
dividends are not paid in full, as aforesaid, upon the shares of this
Series and any other Preferred Stock ranking on a parity as to dividends
with this Series, all dividends declared upon shares of this Series and
any other Preferred Stock ranking on a parity as to dividends with this
Series shall be declared pro rata so that the amount of dividends declared
per share on this Series and such other Preferred Stock shall in all cases
bear to each other the same ratio that accrued dividends per share on the
shares of this Series and such other Preferred Stock bear to each other.
Holders of shares of this Series shall not be entitled to any dividends,
whether payable in cash, property or stock, in excess of full cumulative
dividends, as herein provided, on this Series. No interest, or sum of
money in lieu of interest, shall be payable in respect of any dividend
payment or payments on this Series which may be in arrears.
(d) So long as any shares of this Series are outstanding, no dividend
(other than a dividend in Common Stock or in any other stock of the
Corporation ranking junior to this Series as to dividends and upon
liquidation and other than as provided in Section 2(c)) shall be declared
or paid or set aside for payment or other distribution declared or made
upon the Common Stock or any other stock of the Corporation ranking junior
to or on a parity with this Series as to dividends or upon liquidation,
nor shall any Common Stock nor any other stock of the Corporation ranking
junior to or on a parity with this Series as to dividends or upon
liquidation be redeemed, purchased or otherwise acquired for any
consideration (or any moneys be paid to or made available for a sinking
fund for the redemption of any shares of any such stock) by the
Corporation (except by conversion into or exchange for stock of the
Corporation ranking junior to this Series as to dividends and upon
liquidation) unless, in each case, the full cumulative dividends on all
outstanding shares of this Series shall have been paid or
contemporaneously are declared and paid for all past dividend periods.
(e) Dividends payable on this Series for each full quarterly dividend
period shall be computed by dividing the annual dividend rate by four and
multiplying by the initial liquidation preference of $50.00 per share.
Dividends payable on this Series for any period shorter or longer than a
full quarterly dividend period, including for the initial dividend period,
shall be computed on the basis of a 360-day year of twelve 30-day months.
3. Optional Redemption; Provision for U.S. Steel Group Special Events;
Related Provisions.
(a) Except as provided in Section 3(b), the shares of this Series shall
not be redeemable by the Corporation prior to April 1, 1996. On and after
April 1, 1996, shares of this Series may, subject to the satisfaction of
the condition set forth in the last sentence of this Section 3(a), be
redeemed, in whole at any time or in part from time to time, at the option
of the Corporation, out of funds legally available for such purpose, for
cash in an amount equal to the following redemption prices per share if
redeemed during the twelve-month period beginning April 1 of the year
indicated below, upon giving notice as provided below:
Year Redemption Dollar
Price Equivalent
(As a
percentage of Per Share
initial
liquidation
preference)
1996 104.55% $52.275
1997 103.90 51.950
1998 103.25 51.625
1999 102.60 51.300
2000 101.95 50.975
2001 101.30 50.650
2002 100.65 50.325
2003 and
thereafter 100.00 50.000
and thereafter at the initial liquidation preference of $50.00 per share,
plus, in each case, an amount equal to all accrued and unpaid dividends
thereon to the date fixed for redemption. No shares of this Series may be
redeemed in accordance with this Section 3(a) if the Corporation shall be
advised on or prior to the related Redemption Date by either Moody's
Investors Service, Inc. (''Moody's'') (provided that Moody's is then
rating the senior unsecured debt of the Corporation) or Standard & Poor's
Corporation (''S&P'') (provided that S&P is then rating the senior
unsecured debt of the Corporation) that such redemption would result in an
immediate lowering by Moody's or S&P, as the case may be, of the credit
rating on the Corporation's senior unsecured debt from its then existing
level, unless the Corporation shall have received from the issuance of
common stock of the Corporation, since the date which is two years prior
to the related Redemption Date, net proceeds in an aggregate amount at
least equal to the product of the initial liquidation preference of $50.00
per share times the number of shares of this Series to be redeemed.
(b) (i) The shares of this Series shall be redeemed by the Corporation,
in whole, out of funds legally available for such purpose, for cash in an
amount equal to the Redemption Price if any of the following events with
respect to the U.S. Steel Group occur (such events, collectively, the
''U.S. Steel Group Special Events''):
(A) (1) The Corporation exchanges all of the outstanding shares of
Steel Stock for all of the outstanding shares of common stock of the
U.S. Steel Group Subsidiary (as provided in Section 2(b)(iii) of
Division I of the Certificate of Incorporation) (the ''Steel Group
Subsidiary Exchange'') or (2) in the event of a Disposition of all or
substantially all of the properties and assets of the U.S. Steel Group,
the Corporation either pays a dividend on the Steel Stock in, or
redeems a number of shares of Steel Stock for, an amount equal to the
Net Proceeds of such Disposition (as provided in Section 2(b)(i)(A) or
Section 2(b)(i)(B), respectively, of Division I of the Certificate of
Incorporation) (the ''Steel Group Disposition Dividend'' or the ''Steel
Group Disposition Redemption'', respectively); or
(B) The Corporation pays a dividend on, or the Corporation or any of
its Subsidiaries consummates a tender offer or exchange offer for,
shares of Steel Stock and the aggregate amount of such dividend or the
consideration paid in such tender offer or exchange offer is an amount
equal to all or substantially all of the properties and assets of the
U.S. Steel Group (the ''Steel Group Special Dividend'' or the ''Steel
Group Tender or Exchange Offer'', respectively); provided that the
calculation of all or substantially all of the properties and assets of
the U.S. Steel Group shall be made without giving effect to any money
borrowed by the Corporation or any of its Subsidiaries in connection
with such dividend or tender offer or exchange offer, as the case may
be.
The Redemption Date of shares of this Series pursuant to this Section
3(b)(i) shall be, if the applicable U.S. Steel Group Special Event is (I)
the Steel Group Subsidiary Exchange, the date of such exchange, (II) the
Steel Group Disposition Dividend or the Steel Group Special Dividend, the
date such dividend is paid, (III) the Steel Group Disposition Redemption,
the date of such redemption or (IV) the Steel Group Tender or Exchange
Offer, the date such tender offer or exchange offer is consummated.
Notwithstanding anything to the contrary contained in this Section
3(b)(i), any redemption pursuant to this Section 3(b)(i) shall be
conditioned upon the actual exchange of Steel Stock for shares of common
stock of the U.S. Steel Group Subsidiary, payment of the Steel Group
Disposition Dividend or the amount due as a result of the Steel Group
Disposition Redemption (in each case in the required kind of capital
stock, cash, securities and/or other property), payment of the Steel Group
Special Dividend or the consummation of the Steel Group Tender or Exchange
Offer, as the case may be.
(ii) The shares of this Series shall be redeemed by the Corporation, in
whole, out of funds legally available for such purpose, for cash in an
amount equal to the Redemption Price if following the Disposition of all
or substantially all of the properties and assets of the U.S. Steel
Group, the Corporation exchanges all of the outstanding shares of Steel
Stock for Marathon Stock (as provided in Section 2(b)(i)(C) of Division I
of the Certificate of Incorporation) and, at any time subsequent to such
exchange, any of the following events with respect to the Marathon Group
occur (such events, collectively, the ''Marathon Group Special Events''):
(A) The Corporation exchanges all of the outstanding shares of
Marathon Stock for all of the outstanding shares of common stock of the
Marathon Group Subsidiary (as provided in Section 2(a)(i) of Division I
of the Certificate of Incorporation) (the ''Marathon Group Subsidiary
Exchange''); or
(B) The Corporation pays a dividend on, or the Corporation or any of
its Subsidiaries consummates a tender offer or exchange offer for,
shares of Marathon Stock and the aggregate amount of such dividend or
the consideration paid in such tender offer or exchange offer is an
amount equal to all or substantially all of the properties and assets
of the Marathon Group (the ''Marathon Group Special Dividend'' or the
''Marathon Group Tender or Exchange Offer'', respectively); provided
that the calculation of all or substantially all of the properties and
assets of the Marathon Group shall be made without giving effect to any
money borrowed by the Corporation or any of its Subsidiaries in
connection with such dividend or tender offer or exchange offer, as the
case may be; provided, further, that, at the time of the payment of
such dividend on, or the consummation of such tender or exchange offer
for, Marathon Stock, there is another class of common stock, other than
Marathon Stock, of the Corporation then outstanding.
The Redemption Date of shares of this Series pursuant to this Section
3(b)(ii) shall be, if the applicable Marathon Group Special Event is (I)
the Marathon Group Subsidiary Exchange, the date of such exchange, (II)
the Marathon Group Special Dividend, the date such dividend is paid or
(III) the Marathon Group Tender or Exchange Offer, the date such tender
offer or exchange offer is consummated. Notwithstanding anything to the
contrary contained in this Section 3(b)(ii), any redemption pursuant to
this Section 3(b)(ii) shall be conditioned upon the actual exchange of
Marathon Stock for shares of common stock of the Marathon Group
Subsidiary, payment of the Marathon Group Special Dividend or the
consummation of the Marathon Group Tender or Exchange Offer, as the case
may be.
(c) The following general redemption provisions shall apply, as the
context requires, to any redemption of any shares of this Series pursuant
to this Section 3:
(i) In the event that fewer than all the outstanding shares of this
Series are to be redeemed, the number of shares to be redeemed shall be
determined by the Board of Directors and the shares to be redeemed
shall be determined by lot or pro rata as may be determined by the
Board of Directors or by any other method as may be determined by the
Board of Directors in its sole discretion to be equitable, provided
that the Corporation may redeem any number of shares of this Series
owned by holders whose aggregate holdings of such shares do not exceed
100 as may be specified by the Corporation.
(ii) In the event the Corporation shall redeem shares of this Series
pursuant to this Section 3, notice of such redemption shall be given,
(x) if such redemption is a result of the Steel Group Tender or
Exchange Offer or the Marathon Group Tender or Exchange Offer, on the
date of the public announcement of such tender offer or exchange offer
by the Corporation or any of its Subsidiaries, but in any event not
less than 30 days prior to such redemption, and on the date of the
public announcement of any extension thereof, (y) if such redemption is
a result of the Steel Group Disposition Dividend or the Steel Group
Disposition Redemption, on a date not less than 45 days prior to the
date selected by the Board of Directors for the payment of such
dividend or such redemption and (z) otherwise, on a date at least 30
days but not more than 60 days prior to the date fixed for such
redemption by the Board of Directors, in each case to each holder of
record of the shares of this Series to be redeemed. Such notice shall
be given by first class mail, postage prepaid, at such holder's address
as the same appears on the stock transfer books of the Corporation.
Neither the failure to mail, to any particular holder, any notice
required by this Section 3(c)(ii) nor any defect therein or in the
mailing thereof, shall affect the sufficiency of the notice or the
validity of the proceedings for redemption with respect to any other
holder. Any notice which was mailed in the manner herein provided shall
be conclusively presumed to have been duly given on the date mailed
whether or not the holder receives the notice. Each such notice shall
state, as appropriate: (A) the Redemption Date; (B) the number of
shares of this Series to be redeemed and, if fewer than all the shares
held by such holder are to be redeemed, the number of such shares to be
redeemed from such holder; (C) the Redemption Price to be paid in
respect of the redemption; (D) the place or places where certificates
for such shares are to be surrendered for the payment of the Redemption
Price; (E) the then current Conversion Price and, if any event then
known to the Corporation will result in an adjustment to the Conversion
Price on or prior to the Redemption Date, such adjusted Conversion
Price and the date of such adjustment; (F) if such redemption of shares
of this Series is the result of a U.S. Steel Group Special Event or a
Marathon Group Special Event, that such redemption is conditioned upon
the occurrence of the applicable U.S. Steel Group Special Event or
Marathon Group Special Event and if that U.S. Steel Group Special Event
is the Steel Group Disposition Dividend or the Steel Group Disposition
Redemption, the last date on which the shares of this Series may be
converted into shares of Steel Stock, determined as set forth in
Section 4(a); and (G) that dividends on the shares of this Series to be
redeemed shall cease to accrue on the Redemption Date, provided that if
such redemption of shares of this Series is the result of a U.S. Steel
Group Special Event or a Marathon Group Special Event, the conditions
to such redemption shall have been satisfied.
(iii) Notice having been given as provided in Section 3(c)(ii), from
and after the Redemption Date (unless default shall be made by the
Corporation in providing an adequate amount of money for the payment of
the Redemption Price necessary to effect such redemption in accordance
with the terms hereof) (A) except if the redemption is the result of a
U.S. Steel Group Special Event or a Marathon Group Special Event and
the conditions to such redemption shall not have been satisfied,
dividends on the shares of this Series so called for redemption shall
cease to accrue, (B) such shares shall no longer be deemed to be
outstanding and (C) all rights of the holders thereof as holders of
shares of this Series shall cease (except the right to receive from the
Corporation the Redemption Price, without interest thereon, upon
surrender and endorsement of their certificates). Upon surrender in
accordance with said notice of the certificates for any shares so
redeemed (properly endorsed or assigned for transfer, unless the
Corporation shall waive such requirement), such shares shall be so
redeemed by the Corporation.
(iv) The Corporation's obligation to provide an adequate amount of
money for the payment of the Redemption Price necessary to effect any
redemption in accordance with this Section 3 shall be deemed fulfilled
if, on or before the applicable Redemption Date, the Corporation shall
deposit with a bank or trust company that has an office in the Borough
of Manhattan, City of New York, and that has, or is an affiliate of a
bank or trust company that has, a capital and surplus of at least
$50,000,000, an amount of money adequate for the payment of the
aggregate Redemption Price necessary for such redemption in accordance
with the terms hereof, in trust, with irrevocable instructions that
such money be applied to the redemption of the shares of this Series so
called for redemption. If such redemption is conditioned upon the
payment of the Steel Group Disposition Dividend or payment of the
amount due as a result of the Steel Group Disposition Redemption, the
Corporation shall deposit such moneys and give such irrevocable
instructions in respect of such redemption, subject to the payment of
such Steel Group Disposition Dividend or payment of the amount due as a
result of such Steel Group Disposition Redemption, not later than the
30th day prior to the date selected by the Board for the payment of
such dividend on, or the redemption of, Steel Stock, but in any event
prior to the date the Corporation declares such dividend or gives
notice of such redemption, each in accordance with Section 2 of
Division I of the Certificate of Incorporation. No interest shall
accrue for the benefit of the holders of shares of this Series to be
redeemed on any money so payable by the Corporation in respect of any
redemption. Subject to applicable escheat laws, any money unclaimed at
the end of two years from the related Redemption Date shall revert to
the general funds of the Corporation, after which reversion the holders
of such shares so called for redemption shall look only to the general
funds of the Corporation for the payment of such money. In case fewer
than all the shares of this Series represented by any such certificate
are redeemed, a new certificate shall be issued representing the
unredeemed shares without cost to the holder thereof.
(v) Any shares of this Series which shall at any time have been
redeemed shall, upon the taking of any action required by law, have the
status of authorized but unissued shares of Preferred Stock, without
designation as to series until such shares are once more designated as
part of a particular series by the Board of Directors.
(vi) Notwithstanding the foregoing provisions of this Section 3,
unless the full cumulative dividends on all outstanding shares of this
Series shall have been paid or contemporaneously are declared and paid
for all past dividend periods, no shares of this Series shall be
redeemed unless all outstanding shares of this Series are
simultaneously redeemed, and the Corporation shall not purchase or
otherwise acquire any shares of this Series; provided, however, that
the foregoing shall not prevent the purchase or acquisition of shares
of this Series pursuant to a purchase or exchange offer made on the
same terms to holders of all outstanding shares of this Series.
4. Conversion or Exchange. Holders of shares of this Series shall have the
right to convert all or a portion of such shares into shares of Steel Stock,
as follows:
(a) Subject to and upon compliance with the provisions of this Section
4, a holder of shares of this Series shall have the right, at such
holder's option, at any time, to convert such shares into the number of
fully paid and nonassessable shares of Steel Stock equal to the quotient
of (i) the product of the initial liquidation preference for shares of
this Series of $50.00 per share for such shares times the number of shares
of this Series to be converted, divided by (ii) the Conversion Price (as
in effect on the date provided for in the last paragraph of Section 4(b))
by surrendering the certificates representing such shares to be converted,
such surrender to be made in the manner provided in accordance with this
Section 4; provided that the right to convert shares of this Series called
for redemption pursuant to Section 3 shall terminate at the close of
business on the related Redemption Date, unless the Corporation shall
default in making payment of any moneys payable upon such redemption under
Section 3 or, if the redemption of shares of this Series is the result of
a Steel Group Special Event or a Marathon Group Special Event, the
conditions to such redemption shall not have been satisfied; and,
provided, further, that if the Corporation has given notice of a
redemption pursuant to Section 3(c) which is conditioned on the occurrence
of the Steel Group Disposition Dividend or the Steel Group Disposition
Redemption, the right to convert shares of this Series shall terminate on
the 31st day prior to the date selected by the Board of Directors for such
redemption. Any holder of any share or shares of this Series may only
convert whole shares of this Series and the Corporation shall not be
obligated to issue any fractional shares of this Series.
(b) In order to exercise the conversion right, the holder of any shares
of this Series to be converted shall surrender the certificate
representing such shares, duly endorsed or assigned to the Corporation or
in blank, at the office of the Transfer Agent, accompanied by written
notice to the Corporation that the holder thereof elects to convert such
shares or a specified portion thereof. Unless the shares issuable on
conversion are to be issued in the same name as the name in which such
shares of this Series are registered, any shares surrendered for
conversion shall be accompanied by instruments of transfer, in form
satisfactory to the Corporation, duly executed by the holder or such
holder's duly authorized attorney and an amount sufficient to pay any
transfer or similar tax (or evidence reasonably satisfactory to the
Corporation demonstrating that such taxes have been paid).
Holders of shares of this Series at the close of business on a record
date for determining stockholders entitled to receive a dividend shall be
entitled to receive the dividend payable on such shares on the
corresponding dividend payment date (except that holders of shares called
for redemption on a Redemption Date between such record date and the
dividend payment date shall not be entitled to receive such dividend on
such dividend payment date) notwithstanding the conversion thereof
following such dividend record date and prior to such dividend payment
date. However, shares of this Series surrendered for conversion during the
period between the close of business on any dividend record date and the
opening of business on the corresponding dividend payment date (except
shares called for redemption on a Redemption Date during such period) must
be accompanied by payment of an amount equal to the dividend payable on
such shares on such dividend payment date. A holder of shares of this
Series on a dividend record date who (or whose transferee) tenders any
such shares for conversion into shares of Steel Stock on a dividend
payment date will receive the dividend payable by the Corporation on such
shares of this Series on such date, and the converting holder need not
include payment of the amount of such dividend upon surrender of such
shares for conversion. Except as provided above, the Corporation shall
make no payment or allowance for unpaid dividends, whether or not in
arrears, on converted shares or for dividends on the shares of Steel Stock
issued upon such conversion.
As promptly as practicable after the surrender of certificates for
shares of this Series as aforesaid, the Corporation shall issue and shall
deliver at such office to such holder, or on such holder's written order,
a certificate or certificates for the number of full shares of Steel Stock
issuable upon the conversion of such shares in accordance with the
provisions of this Section 4, and any fractional interest in respect of a
share of Steel Stock arising upon such conversion shall be settled as
provided in Section 4(c).
Each conversion shall be deemed to have been effected immediately prior
to the close of business on the date on which the certificates for shares
of this Series shall have been surrendered and the notice referred to in
the third preceding paragraph (and, if applicable, payment of an amount
equal to the dividend payable on such shares as described in the second
preceding paragraph) received by the Corporation as aforesaid, and the
person or persons in whose name or names any certificate or certificates
for shares of Steel Stock shall be issuable upon such conversion shall be
deemed to have become the holder or holders of record of the shares
represented thereby at such time on such date and such conversion shall be
at the Conversion Price in effect at such time on such date.
(c) No fractional shares or scrip representing fractions of shares of
Steel Stock or any other common stock of the Corporation shall be issued
upon conversion of any share of this Series. Instead of any fractional
interest in a share of Steel Stock or such other common stock that would
otherwise be deliverable upon the conversion of a share of this Series,
the Corporation shall pay to the holder of such share an amount in cash
based upon the Closing Price of Steel Stock or such other common stock on
the Trading Day immediately preceding the date of conversion. If more than
one share shall be surrendered for conversion at one time by the same
holder, the number of full shares of Steel Stock or such other common
stock issuable upon conversion thereof shall be computed on the basis of
the aggregate number of shares of this Series so surrendered.
(d) The Conversion Price per share of Steel Stock shall be adjusted from
time to time as follows:
(i) If the Corporation shall after the date on which shares of this
Series are initially issued (A) pay a dividend or make a distribution
on any class of its capital stock in shares of Steel Stock, (B)
subdivide the outstanding Steel Stock into a greater number of shares
or (C) combine the outstanding Steel Stock into a smaller number of
shares, then the Conversion Price in effect at the opening of business
on the day next following the date fixed for the determination of
stockholders entitled to receive such dividend or distribution or at
the opening of business on the day next following the day on which such
subdivision or combination becomes effective, as the case may be, shall
be adjusted so that the holder of any share of this Series thereafter
surrendered for conversion shall be entitled to receive the number of
shares of Steel Stock that such holder would have owned or have been
entitled to receive after the happening of any of the events described
above had such share been converted immediately prior to the record
date in the case of a dividend or distribution or the effective date in
the case of a subdivision or combination. An adjustment made pursuant
to this Section 4(d)(i) shall become effective immediately after the
opening of business on the day next following the record date (except
as provided in Section 4(m)) in the case of a dividend or distribution
and shall become effective immediately after the opening of business on
the day next following the effective date in the case of a subdivision
or combination.
(ii) If the Corporation shall issue after the date on which shares of
this Series are initially issued rights or warrants (other than any
rights or warrants (including the Rights) referred to in Section
4(d)(iii) below) to all holders of Steel Stock entitling them (for a
period expiring within 45 days after the record date mentioned below)
to subscribe for or purchase Steel Stock at a price per share less than
the Current Market Price per share of Steel Stock on the record date
for the determination of stockholders entitled to receive such rights
or warrants, then the Conversion Price in effect at the opening of
business on the day next following such record date shall be adjusted
to equal the price determined by multiplying (I) the Conversion Price
in effect immediately prior to the opening of business on the day next
following the date fixed for such determination by (II) a fraction, the
numerator of which shall be the sum of (A) the number of shares of
Steel Stock outstanding on the close of business on the date fixed for
such determination and (B) the number of shares that the aggregate
proceeds to the Corporation from the exercise of such rights or
warrants for Steel Stock would purchase at such Current Market Price,
and the denominator of which shall be the sum of (A) the number of
shares of Steel Stock outstanding on the close of business on the date
fixed for such determination and (B) the number of additional shares of
Steel Stock offered for subscription or purchase pursuant to such
rights or warrants. Such adjustment shall become effective immediately
after the opening of business on the day next following such record
date (except as provided in Section 4(m)). In determining whether any
rights or warrants entitle the holders of Steel Stock to subscribe for
or purchase shares of Steel Stock at less than the Current Market Price
thereof, there shall be taken into account any consideration received
by the Corporation upon issuance and upon exercise of such rights or
warrants, the value of such consideration, if other than cash, to be
determined by the Board of Directors.
(iii) If the Corporation shall distribute to all holders of the Steel
Stock any shares of capital stock (other than common stock of the
Corporation), evidences of indebtedness, cash or other assets of the
Corporation (including securities, but excluding (w) any dividend or
distribution referred to in Section 4(d)(i), (x) any rights or warrants
referred to in Section 4(d)(ii) or in the second or third paragraph of
this Section 4(d)(iii), (y) any dividend or distribution paid
exclusively in cash or (z) any stocks, securities or other property
received as a result of a transaction referred to in Section 4(f)) (any
of the foregoing being hereinafter referred to in this Section
4(d)(iii) as the ''Securities''), then in each such case the Conversion
Price shall be adjusted so that it shall equal the price determined by
multiplying (I) the Conversion Price in effect immediately prior to the
close of business on the date fixed for the determination of
stockholders entitled to receive such distribution by (II) a fraction,
the numerator of which shall be the Current Market Price per share of
the Steel Stock on the record date mentioned below less the then fair
market value (as determined by the Board of Directors) of the portion
of the Securities so distributed to one share of Steel Stock, and the
denominator of which shall be the Current Market Price per share of the
Steel Stock on the record date mentioned below. Such adjustment shall
become effective immediately at the opening of business on the day next
following the record date for the determination of stockholders
entitled to receive such distribution (except as provided in Section
4(m)).
With respect to the Amended and Restated Rights Agreement, dated as of
October 1, 1992 (as amended or otherwise modified from time to time, the
''Restated Rights Agreement''), between the Corporation and Mellon Bank,
N.A. (terms used in this paragraph and not otherwise defined herein having
the meanings set forth in the Restated Rights Agreement), the Conversion
Price will be adjusted only when the Rights issuable pursuant thereto
become exercisable after the Corporation's right of redemption thereunder
has expired. Subject to the foregoing, upon the later to occur of the
Distribution Date and a Section 11(a)(ii) Event (the ''Adjustment Date''),
the Conversion Price in effect at the opening of business on the
Adjustment Date shall be adjusted to equal the price determined by
multiplying such Conversion Price by a fraction the numerator of which
shall be equal to the Current Market Price per share of the Steel Stock on
the Trading Day immediately prior to the Adjustment Date less an amount
equal to the quotient of (x) the aggregate fair market value on the
Adjustment Date (as determined by the Board of Directors) of the Rights
distributed under the Restated Rights Agreement divided by (y) the number
of shares of Steel Stock outstanding on such day prior to the Adjustment
Date and the denominator of which shall be equal to such Current Market
Price per share of the Steel Stock. Such adjustment shall become effective
immediately after the opening of business on the day next following such
Adjustment Date.
In case the Corporation shall (other than pursuant to the Restated
Rights Agreement) distribute rights or warrants to purchase Steel Stock
pro rata to all holders of Steel Stock which rights or warrants are not at
such time immediately exercisable but, upon the occurrence of a specified
event or events (''Exercise Trigger Date'') will become exercisable and
once they become exercisable will entitle, or upon the occurrence of an
additional specified event or events (''Price Trigger Date'') will
entitle, the holder thereof to purchase Steel Stock at a price per share
of Steel Stock less than the Current Market Price of the Steel Stock on
the Trading Day next succeeding the later of the Exercise Trigger Date or
the Price Trigger Date (''Adjustment Trigger Date'') and there shall have
occurred such Adjustment Trigger Date, thus permitting the holders of such
rights or warrants irrevocably to exercise any exchange, subscription or
purchase rights conferred by such rights or warrants at a price per share
of Steel Stock less than such Current Market Price, then the Conversion
Price in effect at the opening of business on the Adjustment Trigger Date
shall be adjusted by multiplying (I) such Conversion Price by (II) a
fraction, the numerator of which shall be equal to the Current Market
Price per share of the Steel Stock on the Trading Day immediately prior to
the Adjustment Trigger Date less an amount equal to the quotient of (x)
the aggregate fair market value on the Adjustment Trigger Date of the
rights or warrants so distributed (as determined by the Board of
Directors) divided by (y) the number of shares of Steel Stock outstanding
on such day prior to the Adjustment Trigger Date and the denominator of
which shall be equal to such Current Market Price per share of the Steel
Stock. Such adjustment shall become effective immediately after the
opening of business on the day next following such Adjustment Trigger
Date.
(iv) If the Corporation shall, by dividend or otherwise, at any time
distribute to all holders of the Steel Stock cash (excluding any
regular quarterly dividend payable solely in cash, any cash that is
distributed as part of a distribution requiring a Conversion Price
adjustment pursuant to Section 4(d)(iii) and cash that is distributed
in a merger or consolidation to which Section 4(f) applies) in an
aggregate amount that, together with (A) the aggregate amount of any
other distributions to all holders of the Steel Stock made exclusively
in cash (to which this Section 4(d)(iv) would otherwise apply) within
the 12 months preceding the date of payment of such distribution and in
respect of which no Conversion Price adjustment has been made and (B)
all Excess Purchase Payments in respect of each tender offer or
exchange offer or other negotiated purchase for Steel Stock concluded
by the Corporation or any of its Subsidiaries within the 12 months
preceding the date of payment of such distribution and in respect of
which no Conversion Price adjustment has been made, exceeds an amount
equal to 121/2% of the product of the Current Market Price per share of
Steel Stock on the date fixed for determination of holders of Steel
Stock entitled to receive such distribution times the number of shares
of Steel Stock outstanding on such date, then the Conversion Price
shall be adjusted so that it shall equal the price determined by
multiplying (I) such Conversion Price in effect immediately prior to
the Conversion Price adjustment contemplated by this Section 4(d)(iv)
by (II) a fraction the numerator of which shall be the Current Market
Price per share of the Steel Stock on the date fixed for determination
of holders of Steel Stock entitled to receive such distribution less
the combined amount of such cash and such Excess Purchase Payments so
distributed applicable to one share of Steel Stock and the denominator
of which shall be such Current Market Price per share of the Steel
Stock on such date of determination. Such adjustment shall become
effective immediately prior to the opening of business on the day next
following the date fixed for such determination.
(v) In case a tender offer or exchange offer or other negotiated
purchase made by the Corporation or any of its Subsidiaries for all or
any portion of the Steel Stock shall be consummated, if the aggregate
amount of any Excess Purchase Payment, together with (A) the aggregate
amount of any distributions made to all holders of Steel Stock made
exclusively in cash (excluding any regular quarterly dividend payable
solely in cash, any cash that is distributed as part of a distribution
requiring a Conversion Price adjustment pursuant to Section 4(d)(iii)
and cash that is distributed in a merger or consolidation to which
Section 4(f) applies) within the 12 months preceding the consummation
of such tender or exchange offer or other negotiated purchase and in
respect of which no Conversion Price adjustment has been made, and (B)
all other Excess Purchase Payments in respect of each tender or
exchange offer or other negotiated purchase for Steel Stock concluded
by the Corporation or any of its Subsidiaries within the 12 months
preceding the consummation of such tender or exchange offer or other
negotiated purchase and in respect of which no Conversion Price
adjustment has been made, exceeds an amount equal to 121/2% of the
product of the Current Market Price per share of Steel Stock on the
consummation date of such tender or exchange offer or other negotiated
purchase (any such date, the ''Purchase Date'') times the number of
shares of Steel Stock outstanding (including any tendered, exchanged or
purchased shares) on such Purchase Date, then the Conversion Price
shall be adjusted so that it shall equal the price determined by
multiplying (I) such Conversion Price in effect immediately prior to
such Purchase Date by (II) a fraction, the numerator of which shall be
the Current Market Price per share of the Steel Stock on such Purchase
Date less the combined amount of Excess Purchase Payments and such cash
so distributed applicable to one share of Steel Stock and the
denominator of which shall be such Current Market Price per share on
such Purchase Date. Such adjustment shall become effective immediately
prior to the opening of business on the day next following such
Purchase Date.
(vi) The Corporation from time to time may reduce the Conversion
Price by any amount for any period of at least 20 business days (or
such other period as may then be required by applicable law), provided
that the Board of Directors shall have determined that such reduction
is in the best interests of the Corporation. No reduction in the
Conversion Price pursuant to this Section 4(d)(vi) shall become
effective unless the Corporation shall have mailed a notice, at least
15 days prior to the date on which such reduction is scheduled to
become effective, to each holder of shares of this Series. Such notice
shall be given by first class mail, postage prepaid, at such holder's
address as the same appears on the stock transfer books of the
Corporation. Such notice shall state the amount per share by which the
Conversion Price will be reduced and the period for which such
reduction will be in effect.
(vii) The Corporation may make such reductions in the Conversion
Price, in addition to those required by Sections 4(d)(i) through (v),
as the Board determines to be necessary in order that any event treated
for Federal income tax purposes as a dividend of stock or stock rights
will not be taxable to the recipients; provided that any such reduction
shall not be effective until written evidence of the action of the
Board authorizing such reduction shall be filed with the Secretary of
the Corporation and notice thereof shall have been given by first class
mail, postage prepaid, to each holder of shares of this Series at such
holder's address as the same appears on the stock transfer books of the
Corporation.
(e) No adjustment in the Conversion Price shall be required unless such
adjustment would require a cumulative increase or decrease of at least 1%
in such price; provided, however, that any adjustments that by reason of
this Section 4(e) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment until made; and provided,
further, that any adjustment shall be required and made in accordance with
the provisions of this Section 4 (other than this Section 4(e)) not later
than such time as may be required in order to preserve the tax-free nature
of a distribution to the holders of shares of Steel Stock or any other
common stock into which shares of this Series are convertible.
Notwithstanding any other provisions of this Section 4, the Corporation
shall not be required to make any adjustment of any Conversion Price
established hereunder for the issuance of any shares of common stock of
the Corporation (including Steel Stock) pursuant to any plan providing for
the reinvestment of dividends or interest payable on securities of the
Corporation and the investment of additional optional amounts in shares of
such common stock under such plan. All calculations under this Section 4
shall be made to the nearest 1/100 of a cent (with $.00005 being rounded
upward) or to the nearest 1/10,000 of a share (with .00005 of a share
being rounded upward), as the case may be.
(f) If the Corporation shall be a party to any transaction (including
without limitation a merger or consolidation of the Corporation and
excluding any transaction as to which Sections 4(d)(i) through (vi)
apply), in each case as a result of which shares of Steel Stock shall be
converted into the right to receive stock, securities or other property
(including cash or any combination thereof), (each of the foregoing being
referred to herein as a ''Transaction''), each share of this Series which
is not converted into the right to receive stock, securities or other
property in connection with such Transaction shall thereafter be
convertible into the kind and amount of shares of stock, securities and
other property (including cash or any combination thereof) receivable upon
the consummation of such Transaction by a holder of that number of shares
or fraction thereof of Steel Stock into which one share of this Series was
convertible immediately prior to such Transaction, assuming such holder of
Steel Stock (i) is not a person with which the Corporation consolidated or
into which the Corporation merged or which merged into the Corporation or
to which such sale or transfer was made, as the case may be (a
''Constituent Person''), or an affiliate of a Constituent Person and (ii)
failed to exercise his rights of election, if any, as to the kind or
amount of stock, securities and other property (including cash) receivable
upon such Transaction (provided that if the kind or amount of stock,
securities and other property (including cash) receivable upon such
Transaction is not the same for each share of Steel Stock of the
Corporation held immediately prior to such Transaction by other than a
Constituent Person or an affiliate thereof and in respect of which such
rights of election shall not have been exercised (''non-electing share''),
then for the purpose of this Section 4(f) the kind and amount of stock,
securities and other property (including cash) receivable upon such
Transaction by each non-electing share shall be deemed to be the kind and
amount so receivable per share by a plurality of the non-electing shares).
The Corporation shall not be a party to any Transaction unless the terms
of such Transaction are consistent with the provisions of this Section
4(f) and it shall not consent or agree to the occurrence of any
Transaction until the Corporation has entered into an agreement with the
other party or parties to such transaction for the benefit of the holders
of shares of this Series that will contain provisions enabling the holders
of such shares that remain outstanding after such Transaction to convert
into the consideration received by holders of Steel Stock at the
Conversion Price in effect immediately prior to such Transaction. The
provisions of this Section 4(f) shall similarly apply to successive
Transactions.
(g) The reclassification of common stock into which shares of this
Series are then convertible into securities which include securities other
than such common stock (other than any reclassification upon a
consolidation or merger to which Section 4(f) applies), shall be deemed to
involve (i) a distribution of such securities other than such common stock
to all holders of such common stock (and the effective date of such
reclassification shall be deemed to be ''the date fixed for the
determination of stockholders entitled to receive such distribution'') and
(ii) a subdivision or combination, as the case may be, of the number of
shares of such common stock outstanding immediately prior to such
reclassification into the number of shares of such common stock
outstanding immediately thereafter (and the effective date of such
reclassification shall be deemed to be the effective date of such
subdivision or combination).
(h) If the Corporation shall, by dividend or otherwise, distribute to
all holders of Steel Stock or other class of common stock into which
shares of this Series are then convertible shares of common stock other
than Steel Stock or any class of common stock into which shares of this
Series are then convertible, each share of this Series shall be
convertible, in addition to the number of shares of Steel Stock and/or
such other common stock into which such share is then convertible, into
the number of shares of such other common stock receivable upon payment of
such distribution to a holder of that number of shares or fraction thereof
of Steel Stock or such other common stock into which one share of this
Series was convertible immediately prior to the record date fixed for the
determination of stockholders entitled to receive such distribution.
Shares of this Series shall become so convertible immediately after the
opening of business on the day next following such record date (except as
provided in Section 4(m)). In addition, a Conversion Price shall be
established with respect to such common stock in an amount equal to the
quotient of (i) the initial liquidation preference of $50.00 per share of
this Series divided by (ii) the number of shares or fraction thereof of
such common stock that a holder of one share of Steel Stock or such other
common stock into which shares of this Series are then convertible would
be entitled to receive on the payment date for such distribution from and
after any such date of determination of stockholders entitled to receive
such distribution and, thereafter, Conversion Price adjustments as nearly
as equivalent in type as may be practicable to the adjustments pursuant to
Sections 4(d) through (f) which are to be made in respect of Steel Stock
shall be made in respect of shares of such common stock. Notwithstanding
the foregoing and the provisions of Section 4(d)(iii), if the Corporation
shall make such a distribution in common stock and, thereafter, all of the
shares of such common stock cease to be outstanding, on the date such
shares of common stock cease to be outstanding (x) the shares of this
Series shall cease to be convertible into shares of such common stock, (y)
a distribution of shares of such common stock shall be deemed to have
occurred on such date and (z) the Conversion Price for the class of common
stock upon which such distribution was made, or if no shares of such class
are then outstanding because shares of such class were exchanged for
shares of another class of common stock, of such other class of common
stock, shall be adjusted in the manner set forth in Section 4(d)(iii) to
the same extent as if shares of the common stock in which such
distribution was made were within the meaning of the term ''Securities''
in Section 4(d)(iii).
(i) After the date, if any, on which all outstanding shares of Steel
Stock or of any other common stock into which shares of this Series are
then convertible are exchanged for shares of another class of common stock
(as provided in the Certificate of Incorporation), each share of this
Series shall thereafter be convertible into the number of shares of such
other class of common stock receivable upon such exchange by a holder of
that number of shares or fraction thereof of Steel Stock and/or such other
common stock into which shares of this Series are then convertible into
which one share of this Series was convertible immediately prior to such
exchange. From and after any such exchange, Conversion Price adjustments
as nearly equivalent as may be practicable to the adjustments pursuant to
Sections 4(d) through 4(h) which, prior to such exchange, were made in
respect of Steel Stock and/or such other common stock into which shares of
this Series are then convertible shall instead be made pursuant to such
Sections 4(d) through 4(h) in respect of shares of such other class of
common stock.
(j) Subject to the provisions of Section 4(k), if:
(i) the Corporation takes any action that would require an adjustment
of the Conversion Price pursuant to Sections 4(d) through (i); or
(ii) there shall be any consolidation or merger to which the
Corporation is a party and for which approval of any stockholders of
the Corporation is required, or the sale or transfer of all or
substantially all of the assets of the Corporation or the U.S. Steel
Group; or
(iii) there shall occur the voluntary or involuntary liquidation,
dissolution or winding up of the Corporation; or
(iv) the Corporation or any of its Subsidiaries shall commence a
tender offer or exchange offer for all or a portion of the outstanding
shares of Steel Stock (or shall amend any such tender or exchange
offer),
then the Corporation shall cause to be filed with the Transfer Agent
and shall cause to be mailed to the holders of shares of this Series at
their addresses as shown on the stock transfer books of the
Corporation, as promptly as possible, but at least 15 days prior to the
earliest applicable date hereinafter specified, a notice stating, as
applicable, (A) the proposed record date for a dividend or distribution
or the proposed effective date of a consolidation, merger, sale,
transfer, liquidation, dissolution or winding up, (B) the date as of
which it is expected that holders of Steel Stock of record shall be
entitled to exchange their shares of Steel Stock for securities or
other property, if any, deliverable upon such consolidation, merger,
sale, transfer, liquidation, dissolution or winding up or (C) the date
on which such tender or exchange offer commenced, the date on which
such tender or exchange offer is scheduled to expire unless extended,
the consideration offered and the other material terms thereof (or the
material terms of any amendment thereto). Failure to give or receive
such notice or any defect therein shall not affect the legality or
validity of the related transaction.
(k) If the Corporation intends:
(i) to effect a U.S. Steel Group Special Event or a Marathon Group
Special Event; or
(ii) exchange shares of Steel Stock for Marathon Stock or Delhi Stock
following a Disposition of all or substantially all of the properties
and assets of the U.S. Steel Group,
then the Corporation shall cause to be filed with the Transfer Agent
and shall cause to be mailed to the holders of shares of this Series at
their addresses as shown on the stock transfer books of the
Corporation, not less than 45 days prior to the Steel Group Disposition
Dividend or the Steel Group Disposition Redemption and not less than 30
days prior to any other U.S. Steel Group Special Event, any Marathon
Group Special Event or any such exchange of Steel Stock for shares of
Marathon Stock or Delhi Stock, a notice stating, as applicable, (A) the
record date for any dividend that is a U.S. Steel Group Special Event
or a Marathon Group Special Event, (B) the date on which any redemption
or exchange that is a U.S. Steel Group Special Event, a Marathon Group
Special Event or an exchange of Steel Stock for shares of Marathon
Stock or Delhi Stock is expected to become effective, and the date as
of which it is expected that holders of record of Steel Stock or
Marathon Stock shall be entitled to exchange their shares of Steel
Stock or Marathon Stock, respectively, for securities or other property
deliverable upon such redemption or exchange or (C) the date on which
the Steel Group Tender or Exchange Offer or the Marathon Group Tender
or Exchange Offer commenced, the consideration offered and the other
material terms thereof (or the material terms of any amendment
thereto). In addition, from and after any exchange of Steel Stock for
Delhi Stock, effected in accordance with Section 2(b)(i) of Division I
of the Certificate of Incorporation, the Corporation shall give similar
notice of its intention to exchange Delhi Stock for shares of the Delhi
Group Subsidiary, if Steel Stock has been exchanged therefor, or to pay
a dividend on, or redeem shares of, Delhi Stock following the
Disposition of all or substantially all of the properties and assets of
the Delhi Group. Failure to give or receive any such notice or any
defect therein shall not affect the legality or validity of the related
transaction. In the event of any conflict between the notice provisions
of this paragraph (k) and paragraph (j) above, the notice provisions of
this paragraph (k) shall govern.
(l) Whenever the Conversion Price is adjusted as herein provided, the
Corporation shall promptly file with the Transfer Agent an officer's
certificate setting forth the Conversion Price after such adjustment and
setting forth a brief statement of the facts requiring such adjustment,
which certificate shall be prima facie evidence of the correctness of such
adjustment. Promptly after delivery of such certificate, the Corporation
shall prepare a notice of such adjustment of the Conversion Price setting
forth the adjusted Conversion Price and the effective date of such
adjustment and shall send such notice of such adjustment of the Conversion
Price by first class mail, postage prepaid, to the holder of each share of
this Series at such holder's address as the same appears on the stock
transfer books of the Corporation.
(m) In any case in which Section 4(d) or 4(h) provides that an
adjustment shall become effective on the day next following a record date
for an event, the Corporation may defer until the occurrence of such event
(A) issuing to the holder of any share of this Series converted after such
record date and before the occurrence of such event the additional shares
of Steel Stock or any other common stock of the Corporation issuable upon
such conversion by reason of the adjustment required by such event over
and above the number of shares of Steel Stock or such other common stock
issuable upon such conversion before giving effect to such adjustment and
(B) paying to such holder any amount in cash in lieu of any fraction
thereof pursuant to Section 4(c).
(n) For purposes of this Section 4, the number of shares of Steel Stock
or any other common stock of the Corporation at any time outstanding shall
not include any shares of Steel Stock or such other common stock then
owned or held by or for the account of Corporation. The Corporation shall
not pay a dividend or make any distribution on shares of Steel Stock or
such other common stock held in the treasury of the Corporation.
(o) There shall be no adjustment of the Conversion Price in case of the
issuance of any stock of the Corporation in a reorganization, acquisition
or other similar transaction except as specifically set forth in this
Section 4. If any action or transaction would require adjustment of any
Conversion Price established hereunder pursuant to more than one paragraph
of this Section 4, only the adjustment which would result in the largest
reduction of such Conversion Price shall be made.
(p) The Corporation covenants that it will at all times reserve and keep
available, free from preemptive rights, out of the aggregate of its
authorized but unissued shares of Steel Stock and/or, if the shares of
this Series are then convertible into other common stock of the
Corporation, such other common stock, or its issued shares of Steel Stock
or such other common stock, as the case may be, held in its treasury, or
both, for the purpose of effecting conversion of shares of this series,
the full number of shares of Steel Stock or such other common stock
deliverable upon the conversion of all outstanding shares of this Series
not theretofore converted. For purposes of this Section 4(p), the number
of shares of Steel Stock or such other common stock that shall be
deliverable upon the conversion of all outstanding shares of this Series
shall be computed as if at the time of computation all such outstanding
shares were held by a single holder.
The Corporation covenants that any shares of Steel Stock or other common
stock of the Corporation issued upon conversion of shares of this Series
shall be validly issued, fully paid and nonassessable.
The Corporation shall endeavor to list the shares of Steel Stock or other
common stock of the Corporation required to be delivered upon conversion of
shares of this Series, prior to such delivery, upon each national securities
exchange, if any, upon which the outstanding Steel Stock or such other common
stock is listed at the time of such delivery.
Prior to the delivery of any securities that the Corporation shall be
obligated to deliver upon conversion of shares of this Series, the
Corporation shall endeavor to comply with all federal and state laws and
regulations thereunder requiring the registration of such securities with, or
any approval of or consent to the delivery thereof by, any governmental
authority.
(q) The Corporation will pay any and all documentary, stamp or similar
issue or transfer taxes payable in respect of the issue or delivery of
shares of Steel Stock or other securities or property on conversion of
shares of this Series pursuant hereto; provided, however, that the
Corporation shall not be required to pay any tax that may be payable in
respect of any transfer involved in the issue or delivery of shares of
Steel Stock or other securities or property in a name other than that of
the holder of such shares to be converted and no such issue or delivery
shall be made unless and until the person requesting such issue or
delivery has paid to the Corporation the amount of any such tax or
established, to the reasonable satisfaction of the Corporation, that such
tax has been paid.
5. Voting. The shares of this Series shall not have any voting powers,
either general or special, except that:
(a) Unless the vote or consent of the holders of a greater number of
shares shall then be required by law, the consent of the holders of at
least 662/3% of all of the shares of this Series at the time outstanding,
given in person or by proxy, either in writing or by a vote at a meeting
called for the purpose at which the holders of shares of this Series shall
vote together as a separate class, shall be necessary for authorizing,
effecting or validating the amendment, alteration or repeal of any of the
provisions of the Certificate of Incorporation or of any certificate
amendatory thereof or supplemental thereto (including any Certificate of
Designation and Terms or any similar document relating to any series of
Preferred Stock) so as to affect adversely the powers, preferences, or
rights, of this Series. The increase of the authorized amount of the
Preferred Stock, or the creation or authorization of any shares of any
other class of stock of the Corporation ranking prior to or on a parity
with the shares of this Series as to dividends or upon liquidation, or the
reclassification of any authorized stock of the Corporation into any such
parity shares, or the creation or authorization of any obligation or
security convertible into or evidencing the right to purchase any such
prior or parity shares shall not be deemed to affect adversely the powers,
preferences or rights of this Series.
(b) Unless the vote or consent of the holders of a greater number of
shares shall then be required by law, the consent of the holders of at
least 662/3% of all of the shares of this Series and all other series of
Preferred Stock ranking on a parity with shares of this Series, either as
to dividends or upon liquidation, at the time outstanding, given in person
or by proxy, either in writing or by a vote at a meeting called for the
purpose at which the holders of shares of this Series and such other
series of Preferred Stock shall vote together as a single class without
regard to series, shall be necessary for authorizing, effecting or
validating the issuance of any shares of any class of stock of the
Corporation ranking prior to the shares of this Series as to dividends or
upon liquidation, or the reclassification of any outstanding stock of the
Corporation into any such prior shares, or the issuance of any obligation
or security convertible into or evidencing the right to purchase any such
prior shares.
(c) Unless the vote or consent of the holders of a greater number of
shares shall then be required by law, the consent of the holders of at
least a majority of all of the shares of this Series and all other series
of Preferred Stock ranking on a parity with this Series, either as to
dividends or upon liquidation, at the time outstanding, given in person or
by proxy, either in writing or by a vote at a meeting called for the
purpose at which the holders of shares of this Series and such other
series of Preferred Stock shall vote together as a single class without
regard to series, shall be necessary for authorizing, effecting or
validating the merger or consolidation of the Corporation into or with any
other corporation if such merger or consolidation would adversely affect
the powers, preferences or rights of this Series or such other series of
Preferred Stock or if, after such merger or consolidation, there shall be
outstanding any shares of any class of stock ranking prior to the shares
of this Series as to dividends or upon liquidation or any obligation or
security convertible into or evidencing the right to purchase any such
prior shares (except such stock, securities or obligations of the
Corporation as may have been outstanding immediately preceding such merger
or consolidation).
(d) If, on the date used to determine stockholders of record for any
meeting of stockholders for the election of directors, a default in
preference dividends on the Preferred Stock shall exist, the number of
directors constituting the Board of Directors shall be increased by two,
and the holders of the Preferred Stock of all series (whether or not the
holders of such series of Preferred Stock would be entitled to vote for
the election of directors if such default in preference dividends did not
exist), shall have the right at such meeting, voting together as a single
class without regard to series, to the exclusion of the holders of Common
Stock of the Corporation, to elect two directors of the Corporation to
fill such newly created directorships. Each director elected by the
holders of shares of Preferred Stock (herein called a ''Preferred
Director''), shall continue to serve as such director for the full term
for which such director shall have been elected, notwithstanding that
prior to the end of such term a default in preference dividends shall
cease to exist. Any Preferred Director may be removed without cause by,
and shall not be removed without cause except by, the vote of the holders
of record of the outstanding shares of Preferred Stock, voting together as
a single class without regard to series, at a meeting of the stockholders,
or of the holders of shares of Preferred Stock, called for the purpose. So
long as a default in any preference dividends on the Preferred Stock shall
exist (A) any vacancy in the office of a Preferred Director may be filled
(except as provided in the following clause (B)) by an instrument in
writing signed by the remaining Preferred Director and filed with the
Corporation and
(B) in the case of the removal of any Preferred Director, the vacancy may
be filled by the vote of the holders of the outstanding shares of
Preferred Stock, voting together as a single class without regard to
series, at the same meeting at which such removal shall be voted. Each
director appointed as aforesaid by the remaining Preferred Director shall
be deemed, for all purposes hereof, to be a Preferred Director. Whenever
the term of office of the Preferred Directors shall end and no default in
preference dividends shall exist, the number of directors constituting the
Board of Directors shall be reduced by two. For the purposes hereof, a
''default in preference dividends'' on the Preferred Stock shall be deemed
to have occurred whenever the amount of accrued and unpaid dividends upon
any series of the Preferred Stock shall be equivalent to six full
quarterly dividends or more (whether or not consecutive), and, having so
occurred, such default shall be deemed to exist thereafter until, but only
until, all accrued dividends on all shares of Preferred Stock of each and
every series then outstanding shall have been paid for all past dividend
periods.
6. Liquidation Rights.
(a) Upon the dissolution, liquidation or winding up of the Corporation,
whether voluntary or involuntary, the holders of the shares of this Series
shall be entitled to receive out of the assets of the Corporation
available for distribution to stockholders, before any payment or
distribution shall be made on any class of the common stock of the
Corporation or on any other class of stock ranking junior to the Preferred
Stock upon liquidation, the amount of $50 per share, plus a sum equal to
all dividends (whether or not earned or declared) on such shares accrued
and unpaid thereon to the date of final distribution.
(b) Neither the sale, lease or exchange (for cash, shares of stock,
securities or other consideration) of all or substantially all the
property and assets of the Corporation nor the merger or consolidation of
the Corporation into or with any other corporation or the merger or
consolidation of any other corporation into or with the Corporation, shall
be deemed to be a dissolution, liquidation or winding up, voluntary or
involuntary, for the purposes of this Section 6.
(c) After the payment to the holders of the shares of this Series of the
full preferential amounts provided for in this Section 6, the holders of
shares of this Series as such shall have no right or claim to any of the
remaining assets of the Corporation.
(d) In the event the assets of the Corporation available for
distribution to the holders of shares of this Series upon any dissolution,
liquidation or winding up of the Corporation, whether voluntary or
involuntary, shall be insufficient to pay in full all amounts to which
such holders are entitled pursuant to Section 6(a), no such distribution
shall be made on account of any shares of any other class or series of
Preferred Stock ranking on a parity with the shares of this Series upon
such dissolution, liquidation or winding up unless proportionate
distributive amounts shall be paid on account of the shares of this
Series, ratably, in proportion to the full distributable amounts for which
holders of all such parity shares are respectively entitled upon such
dissolution, liquidation or winding up.
7. Ranking. For purposes of this resolution, any stock of any class or
classes of the Corporation shall be deemed to rank:
(a) prior to the shares of this Series, either as to dividends or upon
liquidation, if the holders of such class or classes shall be entitled to
the receipt of dividends or of amounts distributable upon dissolution,
liquidation or winding up of the Corporation, whether voluntary or
involuntary, as the case may be, in preference or priority to the holders
of shares of this Series;
(b) on a parity with the shares of this Series, either as to dividends
or upon liquidation, whether or not the dividend rates, dividend payment
dates or redemption or liquidation prices per share or sinking fund
provisions, if any, be different from those of this Series, if the holders
of such stock shall be entitled to the receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the
Corporation, whether voluntary or involuntary, as the case may be, in
proportion to their respective dividend rates or liquidation prices,
without preference or priority, one over the other, as between the holders
of such stock and the holders of shares of this Series; and
(c) junior to shares of this Series, either as to dividends or upon
liquidation, if such class or classes shall be the Series A Junior
Preferred Stock issued by the Corporation pursuant to the Restated Rights
Agreement or if such class or classes shall be any class of common stock
of the Corporation or if the holders of shares of this Series shall be
entitled to receipt of dividends or of amounts distributable upon
dissolution, liquidation or winding up of the Corporation, whether
voluntary or involuntary, as the case may be, in preference or priority to
the holders of shares of such class or classes.
8. Determinations by the Board of Directors. Any determinations made by the
Board of Directors of the Corporation under any provision of this Resolution
shall be final and binding on all stockholders (including holders of shares
of this Series) of the Corporation.
9. Definitions. Unless otherwise defined herein, terms used herein shall
have the meanings assigned to them in Division I of the Certificate of
Incorporation and the following terms shall have the following meanings:
''Board of Directors'' or ''Board'' means, at any time, the duly elected or
acting board of directors (or duly authorized committee thereof) of the
Corporation at such time.
''Certificate of Incorporation'' means the Corporation's Restated
Certificate of Incorporation, as amended, supplemented or otherwise modified
from time to time.
''Closing Price'' of shares of any class of common stock of the Corporation
for any day shall mean the last reported sales price, regular way on such
day, or, if no reported sale takes place on such day, the average of the
reported closing bid and asked prices on such day, regular way, in either
case as reported on the New York Stock Exchange Composite Tape or, if such
common stock is not listed or admitted to trading on the NYSE, on the
principal national securities exchange on which such common stock is listed
or admitted to trading or, if not listed or admitted to trading on any
national securities exchange, on the National Market System of NASDAQ or, if
such common stock is not quoted on such National Market System, the average
of the closing bid and asked prices on such day in the over-the-counter
market as reported by NASDAQ or, if closing bid and asked prices for such
common stock on such day shall not have been reported through NASDAQ, the
average of the closing bid and asked prices on such day as furnished by any
NYSE member firm regularly making a market in such common stock selected for
such purpose by the Board of Directors.
''Conversion Price'' means the conversion price per share of Steel Stock
and/or other shares of common stock of the Corporation into which shares of
this Series are convertible, as such Conversion Price may be adjusted
pursuant to Section 4. The initial conversion price per share of Steel Stock
will be $46.125 (equivalent to a conversion rate of 1.084 shares of Steel
Stock for each share of this Series).
''Current Market Price'' shall mean, with respect to any class of common
stock of the Corporation, the average of the daily Closing Prices of a share
of such common stock during the five consecutive Trading Days selected by the
Corporation commencing not more than 20 Trading Days before, and ending not
later than, the date in question; provided, however, that (i) if the ''ex''
date for any event (other than the issuance or distribution requiring such
computation) that requires an adjustment to the Conversion Price pursuant to
Sections 4(d)(ii) through (v) occurs on or after the 20th Trading Day prior
to the day in question and prior to the ''ex'' date for the issuance or
distribution requiring such computation, the Closing Price for each Trading
Day prior to the ''ex'' date for such other event shall be adjusted by
multiplying such Closing Price by the same fraction by which the Conversion
Price is so required to be adjusted as a result of such other event, (ii) if
the ''ex'' date for any event (other than the issuance or distribution
requiring such computation) that requires an adjustment to the Conversion
Price pursuant to Sections 4(d) (ii) through (v) occurs on or after the
''ex'' date for the issuance or distribution requiring such computation and
on or prior to the day in question, the Closing Price for each Trading Day on
and after the ''ex'' date for such other event shall be adjusted by
multiplying such Closing Price by the reciprocal of the fraction by which the
Conversion Price is so required to be adjusted as a result of such other
event, and (iii) if the ''ex'' date for the issuance or distribution
requiring such computation is on or prior to the day in question, after
taking into account any adjustment required pursuant to clause (ii) of this
proviso, the Closing Price for each Trading Day on or after such ''ex'' date
shall be adjusted by adding thereto the amount of any cash and the fair
market value on the day in question (as determined by the Board of Directors
in a manner consistent with any determination of such value for purposes of
Section 4(d) (iii) or (iv)) of the evidences of indebtedness, shares of
capital stock or assets being distributed applicable to one share of the
applicable class of common stock of the Corporation as of the close of
business on the day before such ''ex'' date. For purposes of this definition,
the term ''ex'' date, with respect to any class of common stock of the
Corporation, (i) when used with respect to any issuance or distribution,
means the first date on which such common stock trades regular way on such
exchange or in the relevant market from which the Closing Price was obtained
without the right to receive such issuance or distribution, (ii) when used
with respect to any subdivision or combination of shares of such common
stock, means the first date on which such common stock trades regular way on
such exchange or in such market after the time at which such subdivision or
combination becomes effective, and (iii) when used with respect to any tender
or exchange offer means the first date on which such common stock trades
regular way on such exchange or in such market after the expiration time of
such tender or exchange offer.
''Excess Purchase Payment'' means the excess, if any, of (A) the aggregate
of the cash and the value (as determined by the Board of Directors) of all
other consideration paid by the Corporation or any of its Subsidiaries with
respect to the shares of the applicable class of common stock of the
Corporation acquired in a tender or exchange offer or other negotiated
purchase respectively, over (B) the product of the Current Market Price per
share of such common stock times the number of shares of such common stock
acquired in such tender or exchange offer or purchase .
''NASDAQ'' means the National Association of Securities Dealers, Inc.
Automated Quotations System or any successor thereto .
''NYSE'' means the New York Stock Exchange, Inc. or any successor thereto.
''Redemption Date'' means any date on which the Corporation redeems any
shares of this Series.
''Redemption Price'' means (i) with respect to any redemption pursuant to
Section 3(a), the applicable amount set forth in such Section and (ii) with
respect to any redemption pursuant to Section 3(b), an amount per share equal
to the sum of the initial liquidation preference of $50.00 per share of this
Series, plus an amount equal to all accrued and unpaid dividends thereon to
the date fixed for redemption .
''Restated Rights Agreement'' shall have the meaning given to it in the
second paragraph of Section
4(d)(iii).
''Rights'' shall mean the rights of the Corporation which are issuable
under the Corporation's stockholder rights plan adopted by the Board of
Directors, the terms and conditions of which are set forth in the Restated
Rights Agreement, or rights to purchase any capital stock of the Corporation
under any successor shareholder rights plan or plan adopted in replacement of
the Corporation's stockholder rights plan.
''Subsidiary'' means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Corporation or by one
or more other Subsidiaries. For the purposes of this definition, ''voting
stock'' means stock which ordinarily has voting power for the election of
directors, whether at all times or only so long as no senior class of stock
has such voting power by reason of any contingency.
''substantially all of the properties and assets of the U.S. Steel Group''
and ''substantially all of the properties and assets of the Marathon Group''
shall mean a portion of such properties and assets that represents at least
80% of either of the then-current market value of, or the aggregate revenues
for the immediately preceding twelve fiscal quarterly periods of the
Corporation derived from, the properties and assets of the U.S. Steel Group
or the Marathon Group, respectively, as of such date (excluding the
properties and assets of any person, entity or group in which the
Corporation, directly or indirectly, owns less than a majority interest).
''Trading Day'' shall mean, with respect to any class of common stock of
the Corporation, any day on which such common stock is traded on the NYSE, or
if such common stock is not listed or admitted to trading on the NYSE, on the
principal national securities exchange on which such common stock is listed
or admitted, or if not listed or admitted to trading on any national
securities exchange, on the National Market System of the NASDAQ, or if such
common stock is not quoted on such National Market System, in the applicable
securities market in which such common stock is traded.
''Transfer Agent'' means the Corporation, through its Shareholder Services
Department, or such other agent or agents of the Corporation as may be
designated by the Board of Directors as the Transfer Agent for shares of this
Series.
Fifth: The existence of the Corporation is to be perpetual.
Sixth: The private property of the stockholders shall not be subject to the
payment of corporate debts to any extent whatever.
Seventh: The number of directors of the Corporation shall be fixed from time
to time by, or in the manner provided in, its by-laws and may be increased or
decreased as therein provided; but the number thereof shall not be less than
three.
The directors of the Corporation shall be divided into three classes: Class I,
Class II and Class III. Each class shall consist, as nearly as may be possible,
of one-third of the whole number of the Board of Directors. In the election of
directors at the 1984 annual meeting of the stockholders, the Class I directors
shall be elected to hold office for a term to expire at the first annual meeting
of the stockholders thereafter; the Class II directors shall be elected to hold
office for a term to expire at the second annual meeting of the stockholders
thereafter; and the Class III directors shall be elected to hold office for a
term to expire at the third annual meeting of the stockholders thereafter, and
in the case of each class, until their respective successors are duly elected
and qualified. At each annual election held after the 1984 annual meeting of the
stockholders the directors elected to succeed those whose terms expire shall be
identified as being of the same class as the directors they succeed and shall be
elected to hold office for a term to expire at the third annual meeting of the
stockholders after their election, and until their respective successors are
duly elected and qualified. If the number of directors is changed, any increase
or decrease in directors shall be apportioned among the classes so as to
maintain all classes as equal in number as possible, and any additional director
elected to any class shall hold office for a term which shall coincide with the
terms of the other directors in such class and until his successor is duly
elected and qualified.
In the case of any increase in the number of directors of the Corporation, the
additional director or directors shall be elected by the Board of Directors.
In the case of any vacancy in the Board of Directors from death, resignation,
disqualification or other cause, a successor to hold office for the unexpired
portion of the term of the director whose place shall be vacant, and until the
election of his successor, shall be elected by a majority of the Board of
Directors then in office, though less than a quorum.
Directors of the Corporation may be removed only for cause.
Eighth: The Board of Directors shall have power to adopt, amend and repeal the
by-laws at any regular or special meeting of the Board of Directors, provided
that notice of intention to adopt, amend or repeal the by-laws in whole or in
part shall have been included in the notice of meeting; or, without any such
notice, by a vote of two-thirds of the directors then in office.
Stockholders may adopt, amend and repeal the by-laws at any regular or special
meeting of the stockholders by an affirmative vote of two-thirds of the shares
outstanding and entitled to vote thereon, provided that notice of intention to
adopt, amend or repeal the by-laws in whole or in part shall have been included
in the notice of the meeting.
Any action required to be taken at any annual or special meeting of the
stockholders of the Corporation, or any action which may be taken at any annual
or special meeting of the stockholders or otherwise, may not be taken without a
meeting, prior notice and a vote, and stockholders may not act by written
consent.
Ninth: The Board of Directors from time to time shall determine whether and to
what extent, and at what times and places, and under what conditions and
regulations, the accounts and books of the Corporation, or any of them, shall be
open to the inspection of the stockholders, and no stockholder shall have any
right to inspect any account or book or document of the Corporation, except as
conferred by law or authorized by the Board of Directors, or by the
stockholders.
Tenth: The directors may from time to time declare such dividends as they
shall deem advisable and proper, subject to the provisions of Article Fourth and
to such restrictions as may be imposed by law, and pay the same to the
stockholders at such times as they shall fix.
The Board of Directors shall have power to issue bonds, debentures, or other
obligations, either non-convertible or convertible into the Corporation's stock,
subject to the provisions of Article Fourth and upon such terms, in such manner
and under such conditions in conformity with law, as may be fixed by the Board
of Directors prior to the issue of such bonds, debentures or other obligations.
Eleventh: No director shall be personally liable to the Corporation or its
stockholders for monetary damages for any breach of fiduciary duty by such
director as a director, except (i) for 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) pursuant to Section 174 of the Delaware General Corporation Law, or (iv)
for any transaction from which the director derived an improper personal
benefit. No amendment to or repeal of this Article Eleventh shall apply to or
have any effect on the liability or alleged liability of any director of the
Corporation for or with respect to any acts or omissions of such director
occurring prior to such amendment or repeal.
Twelfth: The powers and authorities hereinbefore conferred upon the Board of
Directors are in furtherance and not in limitation of those conferred by the
laws of the State of Delaware.
Thirteenth: The Corporation reserves the right at any time and from time to
time to amend, alter, change or repeal any provision contained in this
Certificate of Incorporation in the manner now or hereafter prescribed by law;
and all rights preferences and privileges of whatsoever nature conferred upon
stockholders, directors or any other persons whomsoever by and pursuant to this
Certificate of Incorporation in its present form or as hereafter amended are
granted subject to the rights reserved in this Article.
In Witness Whereof, this Restated Certificate of Incorporation, which restates
and integrates and does not further amend the provisions of the Corporation's
Certificate of Incorporation, as heretofore amended and supplemented, there
being no discrepancies between those provisions and the provisions of this
Restated Certificate of Incorporation, and having been duly adopted by the Board
of Directors of the Corporation in accordance with the provisions of Section 245
of the General Corporation Law of the State of Delaware, has been executed on
the 1st day of May, 1999.
USX CORPORATION
/s/ T. J. Usher
By: T. J. Usher
Chairman of the Board
of Directors