Composite Copy
RESTATED ARTICLES OF INCORPORATION
OF
TAUBMAN CENTERS, INC.
1. These Restated Articles of Incorporation are executed on behalf of Taubman
Centers, Inc. (the "Corporation") pursuant to the provisions of Section 643
of the Michigan Business Corporation Act (the "Act").
2. The present name of the Corporation is: Taubman Centers, Inc.
3. The corporation identification number (CID) assigned by the Bureau is:
011-602.
4. Except for the Corporation's present name, the Corporation has not used any
name other than Taubman Realty, Inc.
5. The date of filing the original articles of incorporation was November 21,
1973.
6. These Restated Articles of Incorporation were duly adopted by the Board of
Directors of the Corporation in accordance with the provisions of Section
641(4) of the Act.
7. The following Restated Articles of Incorporation only restate and integrate
(and do not further amend) the Corporation's Second Amended and Restated
Articles of Incorporation, as previously amended. There is no material
discrepancy between the provisions of the Corporation's Second Amended and
Restated Articles of Incorporation, as amended, and the following Restated
Articles of Incorporation (referred to below as "these Amended and Restated
Articles of Incorporation").
ARTICLE I
Name
The name of the Corporation is: Taubman Centers, Inc.
ARTICLE II
Purpose
The purpose for which the Corporation is organized is to:
1. own, hold, develop and dispose of and invest in any type of retail real
property or mixed use real property having a retail component of
significant value in relation to the value of the entire mixed use real
property, including any entity whose material assets include such real
properties including, but not limited to, partnership interests in The
Taubman Realty Group Limited Partnership, a Delaware limited partnership,
and any successor thereto ("TRG");
2. act as managing general partner of TRG;
3. at such time, if ever, as TRG distributes its assets to its partners, own,
hold, manage, develop and dispose of said assets and in all other respects,
carry on the business of TRG;
4. qualify as a REIT (as hereinafter defined); and
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5. engage in any other lawful act or activity for which corporations may be
organized under the Michigan Business Corporation Act in addition to any of
the foregoing purposes, that is consistent with the Corporation's
qualification as a REIT.
ARTICLE III
Capital
1. Classes and Number of Shares.
The total number of shares of all classes of stock that the Corporation
shall have authority to issue is 500,000,000 shares. The classes and the
aggregate number of shares of stock of each class are as follows:
250,000,000 shares of Common Stock, par value $0.01 per share (the
"Common Stock"), which shall have the rights and limitations set forth
below.
250,000,000 shares of preferred stock (the "Preferred Stock"), which
may be issued in one or more series having such relative rights,
preferences, priorities, privileges, restrictions, and limitations as the
Board of Directors may determine from time to time.
2. Certain Powers, Rights, and Limitations of Capital Stock.
(a) Common Stock. Subject to the rights, preferences, and limitations that
the Board of Directors designates with respect to any series of Preferred Stock,
a statement of certain powers, rights, and limitations of the shares of the
Common Stock is as follows:
(i) Dividend Rights. The holders of shares of the Common Stock shall
be entitled to receive such dividends as may be declared by the Board of
Directors of the Corporation with respect to the Common Stock, subject to
the preferential rights of any series of Preferred Stock designated by the
Corporation's Board of Directors.
(ii) Rights Upon Liquidation. Subject to the provisions of Subsection
(e) of this Section 2 of this Article III, in the event of any voluntary or
involuntary liquidation, dissolution or winding up of, or any distribution
of the assets of, the Corporation, each holder of shares of the Common
Stock shall be entitled to receive, ratably with each other holder of
shares of the Common Stock, that portion of the assets of the Corporation
available for distribution to its holders of shares of Common Stock as the
number of shares of the Common Stock held by such holder bears to the total
number of shares of Common Stock (including shares of Common Stock that
have become Excess Stock) then outstanding.
(b) Voting Rights. Subject to the provisions of Subsection (e) of this
Section 2 of this Article III, the holders of shares of the Common Stock shall
be entitled to vote on all matters (for which a common shareholder shall be
entitled to vote thereon) at all meetings of the shareholders of the
Corporation, and shall be entitled to one vote for each share of the Common
Stock entitled to vote at such meeting. Any action to be taken by the
shareholders, other than the election of directors or adjourning a meeting,
including, but not limited to, the approval of an amendment to these Amended and
Restated Articles of Incorporation (other than an amendment by the Board of
Directors to establish the relative rights, preferences, priorities, privileges,
restrictions, and limitations of Preferred Stock as provided in Subsection (c)
of this Section 2 of this Article III, which amendment by the Board of Directors
shall require no action to be taken by the shareholders), shall be authorized if
approved by the affirmative vote of two-thirds of the shares of Capital Stock
entitled to vote thereon. Directors shall be elected if approved by a plurality
of the votes cast at an election.
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(c) Preferred Stock. The Preferred Stock shall have such relative rights,
preferences, priorities, privileges, restrictions, and limitations as the Board
of Directors may determine from time to time by one or more amendments to these
Amended and Restated Articles of Incorporation.
(i) Series A Preferred Stock. Subject in all cases to the other
provisions of this Section 2 of this Article III, including, without
limitation, those provisions restricting the Beneficial Ownership and
Constructive Ownership of shares of Capital Stock and those provisions
with respect to Excess Stock, the following sets forth the
designation, preferences, limitations as to dividends, voting and
other rights, and the terms and conditions of redemption of the Series
A Preferred Stock (defined below) of the Corporation.
(a) There is hereby established a series of Preferred Stock
designated "8.30% Series A Cumulative Redeemable Preferred Stock,
par value $0.01 per share" (the "Series A Preferred Stock"),which
shall consist of 8,000,000 authorized shares.
(b) All shares of Series A Preferred Stock redeemed,
purchased, exchanged, or otherwise acquired by the Corporation
shall be restored to the status of authorized but unissued shares
of Preferred Stock.
(c) The Series A Preferred Stock shall, with respect to
dividend rights, rights upon liquidation, winding up or
dissolution, and redemption rights, rank (i) junior to any other
series of Preferred Stock hereafter duly established by the Board
of Directors of the Corporation, the terms of which specifically
provide that such series shall rank prior to the Series A
Preferred Stock as to the payment of dividends and distribution
of assets upon liquidation (the "Senior Preferred Stock"), (ii)
pari passu with any other series of Preferred Stock hereafter
duly established by the Board of Directors of the Corporation,
the terms of which specifically provide that such series shall
rank pari passu with the Series A Preferred Stock as to the
payment of dividends and distribution of assets upon liquidation
(the "Parity Preferred Stock"), and (iii) prior to any other
class or series of Capital Stock, including, without limitation,
the Common Stock of the Corporation, whether now existing or
hereafter created (collectively, the "Junior Stock").
(d) (1) Subject to the rights of any Senior Preferred Stock,
the holders of the then outstanding shares of Series A Preferred
Stock shall be entitled to receive, as and when declared by the
Board of Directors, out of funds legally available for the
payment of dividends, cumulative preferential cash dividends at
the annual rate of 8.30% of the $25.00 per share liquidation
preference (i.e., $2.075 per annum per share). Such dividends
shall accrue and be cumulative from the date of original issue
and shall be payable in equal quarterly amounts in arrears on or
before the last day of each March, June, September, and December
or, if such day is not a business day, the next succeeding
business day (each, a "Dividend Payment Date") (for the purposes
of this Subparagraph (1) of this Paragraph (d), a "business day"
is any day, other than a Saturday, Sunday, or legal holiday, on
which banks in Detroit, Michigan, are open for business). The
first dividend, which shall be paid on December 31, 1997, will be
for less than a full quarter. All dividends on the Series A
Preferred Stock, including any dividend for any partial dividend
period, shall be computed on the basis of a 360-day year
consisting of twelve 30-day months. Dividends will be payable to
holders of record as they appear in the stock records of the
Corporation at the close of business on the applicable record
date, which shall be the 15th day of the calendar month in which
the applicable Dividend Payment Date falls or on such other date
designed by the Board of Directors of the Corporation for the
payment of dividends that is not more than 30 nor less than ten
days prior to such Dividend Payment Date (each, a "Dividend
Record Date").
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(2) No dividends on the Series A Preferred Stock shall
be declared by the Board of Directors or paid or set apart for
payment by the Corporation at such time as any agreement of the
Corporation, including any agreement relating to its
indebtedness, prohibits such declaration, payment, or setting
apart for payment or provides that such declaration, payment, or
setting apart for payment would constitute a breach of, or a
default under, such agreement or if such declaration, payment, or
setting aside shall be restricted or prohibited by law.
(3) Dividends on the Series A Preferred Stock shall
accrue and be cumulative regardless of whether the Corporation
has earnings, regardless of whether there are funds legally
available for the payment of such dividends, and regardless of
whether such dividends are declared. Accrued but unpaid dividends
on the Series A Preferred Stock will accumulate as of the
Dividend Payment Date on which they first become payable. Except
as set forth below in this Subparagraph (3), no dividends shall
be declared or paid or set apart for payment on any Common Stock
or any other series of Preferred Stock ranking, as to dividends,
on a parity with or junior to the Series A Preferred Stock (other
than a dividend in shares of Junior Stock) for any period unless
full cumulative dividends have been or contemporaneously are
declared and paid or declared and a sum sufficient for the
payment thereof is set apart for such payment on the Series A
Preferred Stock for all past dividend periods and the then
current dividend period. When dividends are not paid in full (and
a sum sufficient for such full payment is not so set apart) upon
the Series A Preferred Stock and the shares of any other series
of Preferred Stock ranking on a parity as to dividends with the
Series A Preferred Stock, all dividends declared upon the Series
A Preferred Stock and any other series of Preferred Stock ranking
on a parity as to dividends with the Series A Preferred Stock
shall be declared pro rata, so that the amount of dividends
declared per share of Series A Preferred Stock and such other
series of Preferred Stock shall in all cases bear to each other
the same ratio that accrued dividends per share on the Series A
Preferred Stock and such other series of Preferred Stock (which
shall not include any accrual in respect of unpaid dividends for
prior dividend periods if such Preferred Stock does not have a
cumulative dividend) bear to each other. No interest shall be
payable in respect of any dividend payment on the Series A
Preferred Stock that may be in arrears. Holders of shares of the
Series A Preferred Stock shall not be entitled to any dividend,
whether payable in cash, property, or stock, in excess of full
cumulative dividends on the Series A Preferred Stock as provided
above. Any dividend payment made on shares of the Series A
Preferred Stock shall first be credited against the earliest
accumulated but unpaid dividend due with respect to such shares
that remains payable.
(4) Except as provided in Subparagraph (3) of this
Paragraph (d) of this Item (i) of this Subsection (c) of this
Section 2 of this Article III, unless full cumulative dividends
on the Series A Preferred Stock have been or contemporaneously
are declared and paid or declared and a sum sufficient for the
payment thereof is set apart for payment for all past dividend
periods and the then current dividend period: (i) no dividends
(other than in shares of Junior Stock) shall be declared or paid
or set aside for payment nor shall any other distribution be
declared or made upon the Common Stock (or any other Preferred
Stock ranking junior to or on a parity with the Series A
Preferred Stock as to dividends or upon liquidation); and (ii) no
shares of Common Stock (or any other Preferred Stock of the
Corporation ranking junior to or on a parity with the Series A
Preferred Stock as to dividends or upon liquidation) shall be
redeemed, purchased, or otherwise acquired for any consideration
(nor shall any moneys be paid to or made available for a sinking
fund for the redemption of any such shares) by the Corporation
(except by conversion into or exchange for Junior Stock).
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(5) If for any taxable year the Corporation elects to
designate as "capital gains dividends" (as defined in Section 857
of the Code) any portion (the "Capital Gains Amount") of the
dividends paid or made available for the year to holders of all
classes of Capital Stock (the "Total Dividends"), then the
portion of the Capital Gains Amount that shall be allocable to
the holders of Series A Preferred Stock shall be the amount that
the total dividends paid or made available to the holders of the
Series A Preferred Stock for the year bears to the Total
Dividends.
(e) Subject to the rights of any Senior Stock, upon any
voluntary or involuntary liquidation, dissolution, or winding up
of the affairs of the Corporation, and before any distribution of
assets shall be made in respect of any Junior Stock, the holders
of the Series A Preferred Stock shall be entitled to be paid out
of the assets of the Corporation legally available for
distribution to its shareholders a liquidation preference of
$25.00 per share in cash (or property having a fair market value
as determined by the Board of Directors valued at $25.00 per
share), plus an amount equal to any accrued but unpaid dividends
to the date of payment. After payment of the full amount of the
liquidating distributions to which they are entitled, the holders
of Series A Preferred Stock shall have no right or claims to any
of the remaining assets of the Corporation. Neither the
consolidation or merger of the Corporation with or into any other
corporation, trust, or entity (or of any other corporation with
or into the Corporation) nor the sale, lease, or conveyance of
all or substantially all of the property or business of the
Corporation shall be deemed to constitute a liquidation,
dissolution or winding up of the Corporation for the purpose of
this Paragraph (e) of this Item (i).
(f) (1) The Series A Preferred Stock is not redeemable prior
to October 3, 2002. On and after October 3, 2002, the
Corporation, at its option upon not less than 30 nor more than 60
days' written notice, may redeem shares of the Series A Preferred
Stock, in whole or in part, at any time and from time to time,
for a cash redemption price of $25.00 per share, plus all accrued
and unpaid dividends to the date fixed for redemption (except as
provided below).
(2) The redemption price of the Series A Preferred Stock
(other than the portion thereof consisting of accrued but unpaid
dividends) shall be payable solely out of the sale proceeds of
other "capital stock" of the Corporation. For purposes of the
preceding sentence, the term "capital stock" means any equity
securities of the Corporation (including Common Stock and
Preferred Stock), shares, interest, participation, or other
ownership interests (however designated) and any rights (other
than debt securities convertible into or exchangeable for equity
securities) or options to purchase any of the foregoing. Holders
of Series A Preferred Stock to be redeemed shall surrender such
shares at the place designated in the notice of redemption and
shall be entitled to the redemption price and any accrued and
unpaid dividends payable upon such redemption following such
surrender. If notice of redemption has been given and if the
Corporation has set aside in trust the funds necessary for the
redemption, then from and after the redemption date: (i)
dividends shall cease to accrue on such shares of Series A
Preferred Stock; (ii) such shares of Series A Preferred Stock
shall no longer be deemed outstanding; and (iii) all rights of
the holders of such shares shall terminate, except the right to
receive the redemption price. If less than all of the outstanding
Series A Preferred Stock is to be redeemed, the Series A
Preferred Stock to be redeemed shall be selected pro rata (as
nearly as may be practicable without creating fractional shares)
or by any other equitable method determined by the Corporation.
(3) Unless full cumulative dividends on all shares of
Series A Preferred Stock shall have been or contemporaneously are
declared and paid or declared
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and a sum sufficient for the payment thereof set apart for
payment, no shares of Series A Preferred Stock shall be redeemed
unless all outstanding shares of Series A Preferred Stock are
simultaneously redeemed, and the Corporation shall not purchase
or otherwise acquire directly or indirectly any shares of Series
A Preferred Stock (except by exchange for Junior Stock); however,
the foregoing shall not prevent the purchase or acquisition of
shares of Series A Preferred Stock pursuant to a purchase or
exchange offer made on the same terms to holders of all
outstanding shares of Series A Preferred Stock.
(4) Notice of redemption shall be given by publication
in a newspaper of general circulation in The City of New York,
such publication to be made once a week for two successive weeks
commencing not less than 30 nor more than 60 days prior to the
redemption date. A similar notice shall be mailed by the
Corporation, postage prepaid, not less than 30 nor more than 60
days prior to the redemption date, addressed to the respective
holders of record of the Series A Preferred Stock to be redeemed
at their respective addresses as they appear on the stock
transfer records of the Corporation. No failure to give or defect
in such notice shall affect the validity of the proceedings for
the redemption of any shares of Series A Preferred Stock except
as to the holder to whom notice was defective or not given. Each
notice shall state: (i) the redemption date; (ii) the redemption
price; (iii) the number of shares of Series A Preferred Stock to
be redeemed; (iv) the place or places where the Series A
Preferred Stock is to be surrendered for payment of the
redemption price; and (v) that dividends on the shares to be
redeemed will cease to accrue on such redemption date. If fewer
than all shares of the Series A Preferred Stock held by any
holder are to be redeemed, the notice mailed to such holder shall
also specify the number of shares of Series A Preferred Stock to
be redeemed from such holder.
(5) The holders of Series A Preferred Stock at the close
of business on a Dividend Record Date shall be entitled to
receive the dividend payable with respect to such Series A
Preferred Stock on the corresponding Dividend Payment Date
notwithstanding the redemption thereof between such Dividend
Record Date and the corresponding Dividend Payment Date or the
Corporation's default in the payment of the dividend due. Except
as provided above, the Corporation will make no payment or
allowance for unpaid dividends, regardless of whether in arrears,
on called Series A Preferred Stock.
(6) The Series A Preferred Stock has no stated maturity
and shall not be subject to any sinking fund or mandatory
redemption. The Series A Preferred Stock is not convertible into
any other securities of the Corporation, but is subject to the
Excess Stock (and all other) provisions of this Article III.
(g) (1) Except as may be required by law or as otherwise
expressly provided in this Item (i) of this Subsection (c) of
this Section 2 of this Article III, the holders of Series A
Preferred Stock shall not be entitled to vote. On all matters
with respect to which the Series A Preferred Stock is entitled to
vote, each share of Series A Preferred Stock shall be entitled to
one vote.
(2) Whenever dividends on the Series A Preferred Stock
are in arrears for six or more quarterly periods, the number of
directors then constituting the Board of Directors shall be
increased by two, and the holders of Series A Preferred Stock
(voting separately as a class with all other series of Preferred
Stock upon which like voting rights have been conferred and are
exercisable) ("Voting Parity Preferred") shall have the right to
elect two directors of the Corporation at a special meeting
called by the holders of record of at least 10% of the Series A
Preferred Stock or at least 10% of any other Voting Parity
Preferred so in arrears (unless such request is received less
than 90 days before the date
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fixed for the next annual or special meeting of the shareholders)
or at the next annual meeting of shareholders, and at each
subsequent annual meeting, until all dividends accumulated on the
Series A Preferred Stock for the past dividend periods and the
then current dividend period have been fully paid or declared and
a sum sufficient for the payment of such dividends has been set
aside for payment. If and when all accumulated dividends and the
dividend for the then current dividend period on the Series A
Preferred Stock shall have been paid in full or set aside for
payment in full, the holders of the Series A Preferred Stock
shall be divested of the foregoing voting rights, and if all
accumulated dividends and the dividend for the then current
period have been paid in full or set aside for payment in full on
all series of Voting Parity Preferred, the term of office of each
director so elected by the holders of the Series A Preferred
Stock and the Voting Parity Preferred shall terminate.
(3) As long as any shares of Series A Preferred Stock
remain outstanding, the Corporation shall not, without the
affirmative vote or consent of the holders of at least two-thirds
of the outstanding shares of Series A Preferred Stock (voting as
a separate class): (i) authorize or create, or increase the
authorized or issued amount of, any Capital Stock ranking senior
to the Series A Preferred Stock with respect to the payment of
dividends or the distribution of assets upon liquidation,
dissolution, or winding up or reclassify any authorized Capital
Stock of the Corporation into such shares, or create, authorize,
or issue any obligation or security convertible into or
evidencing the right to purchase any such shares; or (ii) amend,
alter, or repeal the provisions of these Amended and Restated
Articles of Incorporation, whether by merger, consolidation, or
otherwise (an "Event"), so as to materially and adversely affect
any right, preference, privilege, or voting power of the Series A
Preferred Stock or the holders thereof; however, as long as the
Series A Preferred Stock remains outstanding with its terms
materially unchanged, taking into account that upon the
occurrence of an Event, the Corporation may not be the surviving
entity, the occurrence of an Event described in clause (ii) above
of this Subparagraph (3) shall not be deemed to materially and
adversely affect such rights, preferences, privileges, or voting
power of the holders of Series A Preferred Stock, and (x) any
increase in the amount of the authorized Preferred Stock or the
creation or issuance of any other series of Preferred Stock, or
(y) any increase in the amount of authorized shares of the Series
A Preferred Stock or any other series of Preferred Stock, in each
case ranking on a parity with or junior to the Series A Preferred
Stock with respect to payment of dividends or the distribution of
assets upon liquidation, dissolution, or winding up, shall not be
deemed to materially and adversely affect such rights,
preferences, privileges, or voting powers.
(4) Notwithstanding the foregoing, the Series A
Preferred Stock shall not be entitled to vote, and the foregoing
voting provisions shall not apply, if at or prior to the time
when the act with respect to which such vote would otherwise be
required is effected, all outstanding shares of the Series A
Preferred Stock have been redeemed or called for redemption, and
sufficient funds have been deposited in trust for the benefit of
the holders of the Series A Preferred Stock to effect such
redemption.
(ii) Series B Preferred Stock. Subject in all cases to the other
provisions of this Section 2 of this Article III, including, without
limitation, those provisions restricting the Beneficial Ownership and
Constructive Ownership of shares of Capital Stock and those provisions with
respect to Excess Stock, the following sets forth the designation,
preference, limitation as to dividends, voting, and other rights of the
Series B Preferred Stock (defined below) of the Corporation. Terms that are
used and not otherwise defined in this Item (ii) have the meanings ascribed
to them elsewhere in these Amended and Restated Articles of Incorporation
or, if not so defined, their conventional meanings.
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(a) There is hereby established a series of Preferred Stock
designated "Series B Non-Participating Convertible Preferred Stock,"
(the "Series B Preferred Stock"), which shall initially consist of
40,000,000 authorized shares, subject to one or more increases in the
authorized shares of the series by a further amendment(s) to these
Amended and Restated Articles of Incorporation to permit the issuance
of additional shares upon the issuance of additional Units (defined
below) to Registered Unitholders (defined below) and to accommodate
stock dividends or stock splits as provided below.
(b) All shares of Series B Preferred Stock purchased, exchanged,
or otherwise acquired by the Corporation or that are converted into
Common Stock shall be restored to the status of authorized but
unissued shares of Preferred Stock.
(c) Except upon the dissolution, liquidation, or winding up of
the Corporation, the Series B Preferred Stock shall have no right to
any assets of the Corporation, and (except as expressly set forth in
this Item (ii)) shall have no right to cash dividends or distributions
(from whatever source), but shall have the preference rights upon
dissolution, liquidation, and winding up that are set forth in this
Item (ii) of this Section 2. The Series B Preferred Stock ranks (i)
junior to the Series A Preferred Stock and junior to any Parity
Preferred Stock or Senior Preferred Stock (the Series A Preferred
Stock, the Parity Preferred Stock, and the Senior Preferred Stock are
collectively referred to as the "Series B Senior Preferred Stock"),
(ii) pari passu with any other series of Preferred Stock hereafter
duly established by the Board of Directors of the Corporation, the
terms of which specifically provide that such series shall rank pari
passu with the Series B Preferred Stock as to the distribution of
assets upon liquidation (the "Series B Parity Preferred Stock"), and
(iii) prior to any other class or series of Capital Stock, including,
without limitation, the Common Stock of the Corporation, whether now
existing or hereafter created (collectively, the "Series B Junior
Stock"). If shares of Common Stock or other securities are distributed
on the Common Stock or other voting Capital Stock (as a stock dividend
or otherwise) (a "Voting Stock Dividend"), then each share of Series B
Preferred Stock shall receive a distribution of the number of shares
(or warrants or rights to acquire shares, as the case may be) of
Series B Preferred Stock that would then be necessary to preserve the
relative voting power of the Series B Preferred Stock (i.e., in
relation to the voting power of all outstanding shares of voting
Capital Stock) that existed prior to the Voting Stock Dividend.
(d) Subject to the rights of the Series B Senior Preferred Stock,
upon any voluntary or involuntary dissolution, liquidation, or winding
up of the affairs of the Corporation, and before any distribution of
assets shall be made in respect of any Series B Junior Stock, the
holders of the Series B Preferred Stock shall be entitled to be paid
out of the assets of the Corporation legally available for
distribution to its shareholders a liquidation preference of $0.001
per share in cash (or property having a fair market value as
determined by the Board of Directors valued at $0.001 per share).
After payment of the full amount of the liquidating distributions to
which they are entitled, the holders of Series B Preferred Stock shall
have no right or claims to any of the remaining assets of the
Corporation.
(e) The Series B Preferred Stock has no stated maturity and shall
not be subject to redemption; however, the foregoing shall not be a
restriction on the Corporation's otherwise lawful redemption of shares
of Series B Preferred Stock on a consensual basis with each holder of
the shares to be redeemed.
(f) (1) The Series B Preferred Stock is convertible, and will be
automatically converted under the circumstances described below, into
Common Stock at a conversion ratio of 14,000:1; i.e., each 14,000
shares of Series B Preferred Stock may be
8
converted into one share of Common Stock. In lieu of issuing less than
a full share (a "fractional share") of Common Stock upon the
conversion of fewer than 14,000 shares (or an integral multiple of
14,000 shares) of Series B Preferred Stock, the Corporation shall
redeem the shares of Series B Preferred Stock that would otherwise be
convertible into a fractional share of Common Stock (the "Scrip
Shares"), and from and after the date of the conversion, the Scrip
Shares shall cease to be outstanding shares of Series B Preferred
Stock, shall not constitute any other class of Capital Stock, and
shall entitle the holder only to receive the cash redemption price, as
provided below.
(2) The Corporation will initially issue the Series B
Preferred Stock to each Person who, on the initial date of issuance,
is a Registered Unitholder at the rate of one share for each Unit held
by such Registered Unitholder, if such Registered Unitholder
subscribes for the shares and pays to the Corporation an amount equal
to the product of $0.001 multiplied by the number of shares of Series
B Preferred Stock to be issued to him. Shares of Series B Preferred
Stock may be issued only in certificated, fully registered form and
may be issued only to Registered Unitholders. The Corporation may
issue fractional shares of Series B Preferred Stock. Following the
initial issuance of the Series B Preferred Stock, each Registered
Unitholder acquiring one or more newly issued Units shall be entitled
to receive from the Corporation shares of Series B Preferred Stock
equal in number to the number of newly issued Units acquired by such
Registered Unitholder, provided that the Registered Unitholder
subscribes for the shares and pays to the Corporation an amount equal
to the product of $0.001 multiplied by the number of shares of Series
B Preferred Stock to be issued to him. Except as provided below, a
holder of shares of Series B Preferred Stock may freely effect a
transfer of the shares to any Person (subject to the Transfer being in
compliance with, or (to the satisfaction of the Corporation) exempt
from, applicable securities laws and regulations). Upon a Registered
Unitholder's Transfer of one or more Units to another Registered
Unitholder, then (to the extent of the transferring Registered
Unitholder's then ownership of Series B Preferred Stock) the
transferring Registered Unitholder shall be deemed to have transferred
to the transferee of the Units (i) shares of Series B Preferred Stock
equal in number to the number of transferred Units or if, after giving
effect to the Unit Transfer, the transferring Registered Unitholder
will cease to own any Units, (ii) all of the transferring Registered
Unitholder's shares of Series B Preferred Stock. Notwithstanding the
foregoing, a Registered Unitholder shall have the right (which shall
be exercised by delivering written notice at the time of the Unit
Transfer to the Corporation and the transferee of the Units) to negate
the deemed simultaneous Transfer of Series B Preferred Stock. A
Registered Unitholder desiring to sell (by exchange or otherwise)
Units to the Corporation shall be required to surrender to the
Corporation for conversion shares of Series B Preferred Stock equal in
number to the number of Units being sold (by exchange or otherwise),
but only if and to the extent that, after giving effect to the
Corporation's proposed purchase of Units, the number of outstanding
shares of Series B Preferred Stock will exceed the aggregate number of
Units held by all Registered Unitholders. Shares of Series B Preferred
Stock surrendered for conversion as provided in the immediately
preceding sentence shall be converted into Common Stock, as provided
in subparagraph (1) of this Paragraph (f), upon the Corporation's
purchase of the Units of the surrendering Registered Unitholder, and
the Corporation shall promptly redeem any resulting Scrip Shares for
cash, as provided below. Except as provided above in this subparagraph
(f)(2), a holder of Series B Preferred Stock shall have no voluntary
conversion rights with respect to the Series B Preferred Stock, but
shares of Series B Preferred Stock shall automatically convert into
Common Stock as provided in subparagraph (3) of this Paragraph (f).
(3) After giving effect to a Transfer of shares of Series B
Preferred Stock to a Registered Unitholder, the transferee Registered
Unitholder is permitted to own
9
shares of Series B Preferred Stock up to (i) the number of Units then
owned by such transferee Registered Unitholder or (ii) 5% of the
outstanding shares of Series B Preferred Stock, whichever is greater
(any shares in excess of a transferee Registered Unitholder's
permitted ownership of Series B Preferred Stock are referred to as the
"Disproportionate Shares"). After giving effect to a Transfer of
shares of Series B Preferred Stock to any Person who is not a
Registered Unitholder, the transferee is permitted to own up to 5% of
the outstanding shares of Series B Preferred Stock (any shares held by
a transferee of Series B Preferred Stock who is not a Registered
Unitholder in excess of such 5% limit are referred to as the "Greater
than 5% Shares"). Upon a Transfer of Series B Preferred Stock
resulting in the transferee holding Disproportionate Shares or Greater
than 5% Shares, as applicable, the Disproportionate Shares or Greater
than 5% Shares, as applicable, shall automatically convert into Common
Stock as provided in subparagraph (1) of this Paragraph (f) without
action on the part of anyone, and the Corporation shall promptly
redeem any resulting Scrip Shares for cash, as provided below. Upon
any such automatic conversion, each certificate evidencing converted
shares of Series B Preferred Stock shall instead represent the whole
number of shares of Common Stock into which such shares of Series B
Preferred Stock were converted and the right to receive the cash
redemption payment for any Scrip Shares evidenced by such certificate
until such certificate is surrendered to the Corporation for
cancellation in exchange for a Common Stock certificate and the
redemption price of the Scrip Shares (if any).
(4) Upon conversion of any shares of Series B Preferred
Stock, no payment or adjustment shall be made on account of dividends
declared and payable to holders of Common Stock of record on a date
prior to the date of conversion.
(5) As soon as practicable on or after the date of conversion
of shares of Series B Preferred Stock and the surrender to the
Corporation of the certificate(s) evidencing the converted shares, the
Corporation will issue and deliver to or at the direction of the
converting shareholder a certificate(s) for the whole number of shares
of Common Stock issuable upon such conversion. The Corporation shall
redeem Scrip Shares resulting from a voluntary or automatic conversion
of Series B Preferred Stock for a cash payment equal to the fair value
of the fractional share of Common Stock into which the Scrip Shares
would otherwise be convertible (the fair value shall be the product of
the relevant fraction multiplied by the closing price of the Common
Stock on the trading date next preceding the date of conversion on the
principal national securities exchange on which the Common Stock is
listed (or the average of the high and low prices of the Common Stock
on such date on the principal national market system on which the
Common Stock is traded) or (if the Common Stock is not so listed or
traded) the fair value of the Common Stock on such date as determined
by the Corporation's Board of Directors). The Corporation shall be
responsible for any stamp or other issuance taxes payable upon the
issuance of Common Stock in exchange for surrendered or automatically
converted shares of Series B Preferred Stock.
(g) (1) On all matters with respect to which shareholders of the
Corporation vote, each share of Series B Preferred Stock shall be
entitled to one vote. On all matters with respect to which the Series
B Preferred Stock is entitled to vote as a separate class, including
the nomination of directors pursuant to subparagraph (2) of this
Paragraph (g), the action shall be determined by the vote (which may
be by non-unanimous written consent) of a majority of the outstanding
shares of Series B Preferred Stock entitled to vote. On all other
matters, including the election of directors, the Series B Preferred
Stock will vote as a single class with all other Capital Stock
entitled to vote.
(2) With respect to each annual meeting of the Corporation's
10
shareholders, commencing with the annual meeting of the Corporation's
shareholders to be held in 1999 (the "1999 Annual Meeting"), the
holders of shares of Series B Preferred Stock shall have the right,
voting as a separate class, to designate nominees for election as
directors of the Corporation and to have such nominees included as
such in the Corporation's proxy statement and ballots (or, if none, in
a specially prepared proxy statement and ballots) submitted to the
shareholders of the Corporation entitled to vote in a timely manner
prior to the annual meeting. The Corporation shall use all reasonable
efforts, consistent with the Board of Directors' exercise of its
fiduciary duties, to cause the election of the nominees designated by
the holders of Series B Preferred Stock. With respect to the 1999
Annual Meeting, the holders of Series B Preferred Stock shall have the
right to designate four nominees. With respect to each succeeding
annual meeting of shareholders, the number of nominees to be
designated by the holders of Series B Preferred Stock (the "Base
Number of Series B Nominees") shall be equal to the difference between
(i) four and (ii) the number of directors whose terms commenced prior
to and will continue after such meeting and who were nominated to
serve such terms by the holders of Series B Preferred Stock, voting as
a separate class. The Base Number of Series B Nominees calculated as
set forth in the immediately preceding sentence shall be reduced (i)
by one, if as of the record date for determining the shareholders
entitled to vote for the election of directors at the relevant annual
meeting (the "Record Date"), the Registered Unitholders collectively
own less than 25% (but at least 15%) of the Fully Diluted Common Stock
of the Corporation, (ii) by two, if as of the Record Date, the
Registered Unitholders collectively own less than 15% (but at least
10%) of the Fully Diluted Common Stock of the Corporation, (iii) by
three, if as of the Record Date, the Registered Unitholders
collectively own less than 10% (but at least 5%) of the Fully Diluted
Common Stock of the Corporation, and (iv) to zero, if as of the Record
Date, the Registered Unitholders collectively own less than 5% of the
Fully Diluted Common Stock of the Corporation. For purposes of the
immediately preceding sentence, (i) "Fully Diluted Common Stock of the
Corporation" means all shares of Common Stock issued and outstanding
on the relevant Record Date, plus all shares of Common Stock issuable
upon the exercise of vested employee stock options to acquire Common
Stock and issuable upon the exchange of Units owned by the Registered
Unitholders (assuming a 1:1 exchange ratio and calculated without
regard to limitations imposed on the ability or rights of certain
Registered Unitholders to exchange Units for Common Stock), and (ii)
the Registered Unitholders shall be deemed to "collectively own" all
shares of Common Stock that they own in fact, that they have the right
to acquire upon the exercise of vested employee stock options, and
that would be issued upon the exchange (without regard to limitations
imposed on the ability or rights of certain Registered Unitholders to
exchange Units for Common Stock) of all outstanding Units (and Units
issuable upon the exercise of options to acquire Units) held by the
Registered Unitholders.
(h) At all times when the holders of Series B Preferred Stock,
voting as a separate class, are entitled to designate nominees for
election as directors of the Corporation, (i) the Board of Directors
shall consist of nine directors (other than during any vacancy caused
by the death, resignation, or removal of a director), plus the number
of directors that any series of Preferred Stock, voting separately as
a class, has the right to elect because of the Corporation's default
in the payment of preferential dividends due on such series, and (ii)
a majority of the directors shall be "independent" (for these
purposes, an individual shall be deemed "independent" if such
individual is neither an officer nor an employee of the Corporation or
any of its direct or indirect subsidiaries). At such time as the
holders of Series B Preferred Stock no longer have the right to
designate any nominees for election as directors of the Corporation,
the size of the Board of Directors shall be as determined in
accordance with the provisions of the By-Laws of the Corporation.
11
(i) For purposes of this Item (ii) of this Subsection (c) of this
Section 2 of this Article III, the following terms have the indicated
meanings:
(1) "Registered Unitholder" means a Person, other than the
Corporation, (i) who at the relevant time is reflected in the records
of The Taubman Realty Group Limited Partnership as a partner in such
partnership (or who as the result of a Transfer of Units is being
admitted as a partner in such partnership) or (ii) who is (or upon
completion of the relevant Transfer (including, for these purposes,
the exercise of an option to acquire a Unit) will become) a beneficial
owner of Units.
(2) "Units" means Units of Partnership Interest in The
Taubman Realty Group Limited Partnership (and its successors), and any
securities into which such Units of Partnership Interest (as a class)
are converted or for which such Units (as a class) are exchanged,
whether by merger, reclassification, or otherwise. All references in
this Item (ii) of this Subsection (c) of this Section 2 of this
Article III to numbers of Units shall be adjusted to reflect any
splits, reverse splits, or reclassifications of Units of Partnership
Interest.
(j) As long as shares of Series B Preferred Stock remain
outstanding, the Corporation shall not, without the affirmative vote
or consent of the holders of a majority of the outstanding shares of
Series B Preferred Stock (voting as a separate class):
(1) create, authorize, or issue any securities or any
obligation or security convertible into or evidencing the right to
purchase any such securities, the issuance of which could adversely
and (relative to the other outstanding Capital Stock) disparately
affect the voting power or voting rights of the Series B Preferred
Stock or the holders of Series B Preferred Stock (including the rights
under Paragraph (g) of this Item (ii) of this Subsection (c) of this
Section 2 of this Article III, and disregarding, for these purposes,
the right of any series of Preferred Stock, voting as a separate
class, to elect directors of the Corporation as the result of the
Corporation's default in the payment of a preferential dividend to
which the holders of such series of Preferred Stock are entitled);
(2) amend, alter, or repeal the provisions of these Amende
and Restated Articles of Incorporation, whether by merger,
consolidation, or otherwise, in a manner that could adversely affect
the voting power or voting rights of the Series B Preferred Stock or
the holders of Series B Preferred Stock (including the rights under
Paragraph (g) of this Item (ii) of this Subsection (c) of this Section
2 of this Article III, and disregarding, for these purposes, the right
of any series of Preferred Stock, voting as a separate class, to elect
directors of the Corporation as the result of the Corporation's
default in the payment of a preferential dividend to which the holders
of such series of Preferred Stock are entitled);
(3) be a party to a material transaction (including, without
limitation, a merger, consolidation, or share exchange) (a "Series B
Transaction") if the Series B Transaction could adversely and
(relative to the other outstanding Capital Stock) disparately affect
the voting power or voting rights of the Series B Preferred Stock or
the holders of Series B Preferred Stock (including the rights under
Paragraph (g) of this Item (ii) of this Subsection (c) of this Section
2 of this Article III, and disregarding, for these purposes, the right
of any series of Preferred Stock, voting as a separate class, to elect
directors of the Corporation as the result of the Corporation's
default in the payment of a preferential dividend to which the holders
of such series of Preferred Stock are entitled). The provisions of
this subparagraph (3) shall apply to successive Series B Transactions;
or
12
(4) issue any shares of Series B Preferred Stock to anyone
other than a Registered Unitholder as provided in Paragraph (c) or
subparagraph (f)(2) of this Item (ii).
(iii) Series C Preferred Stock. Subject in all cases to the other
provisions of this Section 2 of this Article III, including, without
limitation, those provisions restricting the Beneficial Ownership and
Constructive Ownership of shares of Capital Stock and those provisions with
respect to Excess Stock, the following sets forth the designation,
preferences, limitations as to dividends, voting and other rights, and the
terms and conditions of redemption of the Series C Preferred Stock (defined
below) of the Corporation.
(a) There is hereby established a series of Preferred Stock
designated "9% Series C Cumulative Redeemable Preferred Stock, par
value $0.01 per share" (the "Series C Preferred Stock"), which shall
consist of 2,000,000 authorized shares.
(b) All shares of Series C Preferred Stock redeemed, purchased,
exchanged, or otherwise acquired by the Corporation shall be restored
to the status of authorized but unissued shares of Preferred Stock.
(c) The Series C Preferred Stock shall, with respect to dividend
rights, rights upon liquidation, winding up or dissolution, and
redemption rights, rank (i) junior to any other series of Preferred
Stock hereafter duly established by the Board of Directors of the
Corporation, the terms of which specifically provide that such series
shall rank prior to the Series C Preferred Stock as to the payment of
dividends and distribution of assets upon liquidation (the "Senior
Preferred Stock"), (ii) pari passu with the Series A and Series B
Preferred Stock and any other series of Preferred Stock hereafter duly
established by the Board of Directors of the Corporation, the terms of
which specifically provide that such series shall rank pari passu with
the Series C Preferred Stock as to the payment of dividends and
distribution of assets upon liquidation (the "Parity Preferred
Stock"), and (iii) prior to any other class or series of Capital
Stock, including, without limitation, the Common Stock of the
Corporation, whether now existing or hereafter created (collectively,
the "Junior Stock").
(d) (1) Subject to the rights of any Senior Preferred Stock, the
holders of the then outstanding shares of Series C Preferred Stock
shall be entitled to receive, as and when declared by the Board of
Directors, out of funds legally available for the payment of
dividends, cumulative preferential cash dividends at the annual rate
of 9% of the $75 per share liquidation preference (i.e., $6.75 per
annum per share). Such dividends shall accrue and be cumulative from
the date of original issue and shall be payable in equal quarterly
amounts in arrears on or before the last day of each March, June,
September, and December or, if such day is not a business day, the
next succeeding business day except that, if such business day is in
the next succeeding calendar year, such payment shall be made on the
immediately preceding business day, in each case with the same force
and effect as if made on such date (each, a "Dividend Payment Date")
(for the purposes of this Subparagraph (1) of this Paragraph (d), a
"business day" is any day, other than a Saturday, Sunday, or legal
holiday, on which banks in Detroit, Michigan, are open for business).
The first dividend may be for less than a full quarter. All dividends
on the Series C Preferred Stock, including any dividend for any
partial dividend period, shall be computed on the basis of a 360-day
year consisting of twelve 30-day months. Dividends will be payable to
holders of record as they appear in the stock records of the
Corporation at the close of business on the applicable record date,
which shall be the 15th day of the calendar month in which the
applicable Dividend Payment Date falls or on such other date designed
by the Board of Directors of the Corporation for the payment of
dividends that is not more than 30 nor less than ten days prior to
such Dividend Payment Date (each, a "Dividend Record Date").
13
(2) No dividends on the Series C Preferred Stock shall be
declared by the Board of Directors or paid or set apart for payment by
the Corporation at such time as any agreement of the Corporation,
including any agreement relating to its indebtedness, prohibits such
declaration, payment, or setting apart for payment or provides that
such declaration, payment, or setting apart for payment would
constitute a breach of, or a default under, such agreement or if such
declaration, payment, or setting aside shall be restricted or
prohibited by law.
(3) Dividends on the Series C Preferred Stock shall accrue
and be cumulative regardless of whether the Corporation has earnings,
regardless of whether there are funds legally available for the
payment of such dividends, and regardless of whether such dividends
are declared. Accrued but unpaid dividends on the Series C Preferred
Stock will accumulate as of the Dividend Payment Date on which they
first become payable. Except as set forth below in this Subparagraph
(3), no dividends shall be declared or paid or set apart for payment
on any Common Stock or any other series of Preferred Stock ranking, as
to dividends, on a parity with or junior to the Series C Preferred
Stock (other than a dividend in shares of Junior Stock) for any period
unless full cumulative dividends have been or contemporaneously are
declared and paid or declared and a sum sufficient for the payment
thereof is set apart for such payment on the Series C Preferred Stock
for all past dividend periods and the then current dividend period.
When dividends are not paid in full (and a sum sufficient for such
full payment is not so set apart) upon the Series C Preferred Stock
and the shares of any other series of Preferred Stock ranking on a
parity as to dividends with the Series C Preferred Stock, all
dividends declared upon the Series C Preferred Stock and any other
series of Preferred Stock ranking on a parity as to dividends with the
Series C Preferred Stock shall be declared pro rata, so that the
amount of dividends declared per share of Series C Preferred Stock and
such other series of Preferred Stock shall in all cases bear to each
other the same ratio that accrued dividends per share on the Series C
Preferred Stock and such other series of Preferred Stock (which shall
not include any accrual in respect of unpaid dividends for prior
dividend periods if such Preferred Stock does not have a cumulative
dividend) bear to each other. No interest shall be payable in respect
of any dividend payment on the Series C Preferred Stock that may be in
arrears. Holders of shares of the Series C Preferred Stock shall not
be entitled to any dividend, whether payable in cash, property, or
stock, in excess of full cumulative dividends on the Series C
Preferred Stock as provided above. Any dividend payment made on shares
of the Series C Preferred Stock shall first be credited against the
earliest accumulated but unpaid dividend due with respect to such
shares that remains payable.
(4) Except as provided in Subparagraph (3) of this Paragraph
(d) of this Item (iii) of this Subsection (c) of this Section 2 of
this Article III, unless full cumulative dividends on the Series C
Preferred Stock have been or contemporaneously are declared and paid
or declared and a sum sufficient for the payment thereof is set apart
for payment for all past dividend periods and the then current
dividend period: (i) no dividends (other than in shares of Junior
Stock) shall be declared or paid or set aside for payment nor shall
any other distribution be declared or made upon the Common Stock or
the Series B Preferred Stock (or any other Preferred Stock ranking
junior to or on a parity with the Series C Preferred Stock as to
dividends or upon liquidation); and (ii) no shares of Common Stock or
the Series B Preferred Stock (or any other Preferred Stock of the
Corporation ranking junior to or on a parity with the Series C
Preferred Stock as to dividends or upon liquidation) shall be
redeemed, purchased, or otherwise acquired for any consideration (nor
shall any moneys be paid to or made available for a sinking fund for
the redemption of any such shares) by the Corporation (except by
conversion into or exchange for Junior Stock).
14
(5) If for any taxable year the Corporation elects to
designate as "capital gains dividends" (as defined in Section 857 of
the Code) any portion (the "Capital Gains Amount") of the dividends
paid or made available for the year to holders of all classes of
Capital Stock (the "Total Dividends"), then the portion of the Capital
Gains Amount that shall be allocable to the holders of Series C
Preferred Stock shall be the amount that the total dividends paid or
made available to the holders of the Series C Preferred Stock for the
year bears to the Total Dividends.
(6) Notwithstanding anything to the contrary set forth
herein, the Corporation may declare and pay a dividend on the Common
Stock, without preserving the priority of distributions described in
Subparagraphs 3 and 4 of this Paragraph (d) of this Item (iii) of this
Subsection (c) of this Section 2 of this Article III, but only to the
extent such dividends are required to preserve the Real Estate
Investment Trust status of the Corporation and to avoid the imposition
of an excise tax on the Corporation.
(e) Subject to the rights of any Senior Stock, upon any voluntary
or involuntary liquidation, dissolution or winding up of the affairs
of the Corporation, and before any distribution of assets shall be
made in respect of any Junior Stock, the holders of the Series C
Preferred Stock shall be entitled to be paid out of the assets of the
Corporation legally available for distribution to its shareholders a
liquidation preference of $75 per share in cash (or property having a
fair market value as determined by the Board of Directors valued at
$75 per share), plus an amount equal to any accrued but unpaid
dividends to the date of payment. After payment of the full amount of
the liquidating distributions to which they are entitled, the holders
of Series C Preferred Stock shall have no right or claims to any of
the remaining assets of the Corporation. Neither the consolidation or
merger of the Corporation with or into any other corporation, trust,
or entity (or of any other corporation with or into the Corporation)
nor the sale, lease, or conveyance of all or substantially all of the
property or business of the Corporation shall be deemed to constitute
a liquidation, dissolution or winding up of the Corporation for the
purpose of this Paragraph (e) of this Item (iii).
(f) (1) The Series C Preferred Stock is not redeemable prior to
September 3, 2004. On and after September 3, 2004, the Corporation, at
its option upon not less than 30 nor more than 60 days' written
notice, may redeem shares of the Series C Preferred Stock, in whole or
in part, at any time and from time to time, for a cash redemption
price of $75 per share, plus all accrued and unpaid dividends to the
date fixed for redemption (except as provided below).
(2) The redemption price of the Series C Preferred Stock
(other than the portion thereof consisting of accrued but unpaid
dividends) shall be payable solely out of the sale proceeds of other
"capital stock" of the Corporation. For purposes of the preceding
sentence, the term "capital stock" means any equity securities of the
Corporation (including Common Stock and Preferred Stock), shares,
interest, participation, or other ownership interests (however
designated) and any rights (other than debt securities convertible
into or exchangeable for equity securities) or options to purchase any
of the foregoing. Holders of Series C Preferred Stock to be redeemed
shall surrender such shares at the place designated in the notice of
redemption and shall be entitled to the redemption price and any
accrued and unpaid dividends payable upon such redemption following
such surrender. If notice of redemption has been given and if the
Corporation has set aside in trust the funds necessary for the
redemption, then from and after the redemption date: (i) dividends
shall cease to accrue on such shares of Series C Preferred Stock; (ii)
such shares of Series C Preferred Stock shall no longer be deemed
outstanding; and (iii) all rights of the holders of such shares shall
terminate, except the right to receive the redemption price. If
15
less than all of the outstanding Series C Preferred Stock is to be
redeemed, the Series C Preferred Stock to be redeemed shall be
selected pro rata (as nearly as may be practicable without creating
fractional shares) or by any other equitable method determined by the
Corporation.
(3) Unless full cumulative dividends on all shares of Series
C Preferred Stock shall have been or contemporaneously are declared
and paid or declared and a sum sufficient for the payment thereof set
apart for payment, no shares of Series C Preferred Stock shall be
redeemed unless all outstanding shares of Series C Preferred Stock are
simultaneously redeemed, and the Corporation shall not purchase or
otherwise acquire directly or indirectly any shares of Series C
Preferred Stock (except by exchange for Junior Stock); however, the
foregoing shall not prevent the purchase or acquisition of shares of
Series C Preferred Stock pursuant to a purchase or exchange offer made
on the same terms to holders of all outstanding shares of Series C
Preferred Stock.
(4) Notice of redemption shall be given by publication in a
newspaper of general circulation in The City of New York, such
publication to be made once a week for two successive weeks commencing
not less than 30 nor more than 60 days prior to the redemption date. A
similar notice shall be mailed by the Corporation, postage prepaid,
not less than 30 nor more than 60 days prior to the redemption date,
addressed to the respective holders of record of the Series C
Preferred Stock to be redeemed at their respective addresses as they
appear on the stock transfer records of the Corporation. No failure to
give or defect in such notice shall affect the validity of the
proceedings for the redemption of any shares of Series C Preferred
Stock except as to the holder to whom notice was defective or not
given. Each notice shall state: (i) the redemption date; (ii) the
redemption price; (iii) the number of shares of Series C Preferred
Stock to be redeemed; (iv) the place or places where the Series C
Preferred Stock is to be surrendered for payment of the redemption
price; and (v) that dividends on the shares to be redeemed will cease
to accrue on such redemption date. If fewer than all shares of the
Series C Preferred Stock held by any holder are to be redeemed, the
notice mailed to such holder shall also specify the number of shares
of Series C Preferred Stock to be redeemed from such holder.
(5) The holders of Series C Preferred Stock at the close of
business on a Dividend Record Date shall be entitled to receive the
dividend payable with respect to such Series C Preferred Stock on the
corresponding Dividend Payment Date notwithstanding the redemption
thereof between such Dividend Record Date and the corresponding
Dividend Payment Date or the Corporation's default in the payment of
the dividend due. Except as provided above, the Corporation will make
no payment or allowance for unpaid dividends, regardless of whether in
arrears, on called Series C Preferred Stock.
(6) The Series C Preferred Stock has no stated maturity and
no sinking fund shall be required and shall not be subject to
mandatory redemption. The Series C Preferred Stock is not convertible
into any other securities of the Corporation, but is subject to the
Excess Stock (and all other) provisions of this Article III.
(g) (1) Except as may be required by law or as otherwise
expressly provided in this Item (iii) of this Subsection (c) of this
Section 2 of this Article III, the holders of Series C Preferred Stock
shall not be entitled to vote. On all matters with respect to which
the Series C Preferred Stock is entitled to vote, each share of Series
C Preferred Stock shall be entitled to one vote.
(2) Whenever dividends on the Series C Preferred Stock are
in arrears
16
(which shall, with respect to any quarterly dividend, mean that any
such divided has not been paid in full whether or not earned or
declared) for six or more quarterly periods (whether consecutive or
not), the number of directors then constituting the Board of Directors
shall be increased by two, and the holders of Series C Preferred Stock
(voting separately as a class with all other series of Voting Parity
Preferred) shall have the right to elect two directors of the
Corporation at a special meeting called by the holders of record of at
least 10% of the Series C Preferred Stock or at least 10% of any other
Voting Parity Preferred so in arrears (unless such request is received
less than 90 days before the date fixed for the next annual or special
meeting of the shareholders) or at the next annual meeting of
shareholders, and at each subsequent annual meeting, until all
dividends accumulated on the Series C Preferred Stock for the past
dividend periods and the then current dividend period have been fully
paid or declared and a sum sufficient for the payment of such
dividends has been set aside for payment. If and when all accumulated
dividends and the dividend for the then current dividend period on the
Series C Preferred Stock shall have been paid in full or set aside for
payment in full, the holders of the Series C Preferred Stock shall be
divested of the foregoing voting rights (but subject always to the
same provision for the vesting of such voting rights in the case of
any similar future arrearages in six quarterly dividends), and if all
accumulated dividends and the dividend for the then current period
have been paid in full or set aside for payment in full on all series
of Voting Parity Preferred, the term of office of each director so
elected by the holders of the Series C Preferred Stock and the Voting
Parity Preferred shall terminate.
(3) As long as any hares of Series C Preferred Stock remain
outstanding, the Corporation shall not, without the affirmative vote
or consent of the holders of at least two-thirds of the outstanding
shares of Series C Preferred Stock (voting as a separate class); (i)
authorize or create, or increase the authorized or issued amount of,
any Capital Stock ranking senior to the Series C Preferred Stock with
respect to the payment of dividends or the distribution of assets upon
liquidation, dissolution, or winding up or reclassify any authorized
Capital Stock of the Corporation into or exchangeable for such shares,
or create, authorize, or issue any obligation or security convertible
into or evidencing the right to purchase any such shares; or (ii)
amend, alter, or repeal the provisions of these Amended and Restated
Articles of Incorporation, whether by merger, consolidation or
otherwise (an "Event"), so as to materially and adversely affect any
right, preference, privilege, or voting power of the Series C
Preferred Stock or the holders thereof; however, as long as the Series
C Preferred Stock remains outstanding with its terms materially
unchanged, taking into account that upon the occurrence of an Event,
the Corporation may not be the surviving entity, the occurrence of an
Event described in clause (ii) above of this Subparagraph (3) shall
not be deemed to materially and adversely affect such rights,
preferences, privileges, or voting power of the holders of Series C
Preferred Stock, and (x) any increase in the amount of the authorized
Preferred Stock or the creation or issuance of any other series of
Preferred Stock, or (y) any increase in the amount of authorized
shares of the Series C Preferred Stock or any other series of
Preferred Stock, in the case of either (x) or (y) ranking on a parity
with or junior to the Series C Preferred Stock with respect to payment
of dividends or the distribution of assets upon liquidation,
dissolution, or winding up, shall not be deemed to materially and
adversely affect such rights, preferences, privileges, or voting
powers.
(4) Notwithstanding the foregoing, the Series C Preferred
Stock shall not be entitled to vote, and the foregoing voting
provisions shall not apply, if at or prior to the time when the act
with respect to which such vote would otherwise be required is
effected, all outstanding shares of the Series C Preferred Stock have
been redeemed or called for redemption, and sufficient funds have been
deposited in trust for the benefit of the holders of the Series C
Preferred Stock to effect such redemption.
17
(iv) Series D Preferred Stock. Subject in all cases to the other
provisions of this Section 2 of this Article III, including, without
limitation, those provisions restricting the Beneficial Ownership and
Constructive Ownership of shares of Capital Stock and those provisions with
respect to Excess Stock, the following sets forth the designation,
preferences, limitations as to dividends, voting and other rights, and the
terms and conditions of redemption of the Series D Preferred Stock (defined
below) of the Corporation.
(a) There is hereby established a series of Preferred Stock
designated "9% Series D Cumulative Redeemable Preferred Stock, par
value $0.01 per share" (the "Series D Preferred Stock"), which shall
consist of 250,000 authorized shares.
(b) All shares of Series D Preferred Stock redeemed, purchased,
exchanged, or otherwise acquired by the Corporation shall be restored
to the status of authorized but unissued shares of Preferred Stock.
(c) The Series D Preferred Stock shall, with respect to dividend
rights, rights upon liquidation, winding up or dissolution, and
redemption rights, rank (i) junior to any other series of Preferred
Stock hereafter duly established by the Board of Directors of the
Corporation, the terms of which specifically provide that such series
shall rank prior to the Series D Preferred Stock as to the payment of
dividends and distribution of assets upon liquidation (the "Senior
Preferred Stock"), (ii) pari passu with the Series A, Series B and
Series C Preferred Stock and any other series of Preferred Stock
hereafter duly established by the Board of Directors of the
Corporation, the terms of which specifically provide that such series
shall rank pari passu with the Series D Preferred Stock as to the
payment of dividends and distribution of assets upon liquidation (the
"Parity Preferred Stock"), and (iii) prior to any other class or
series of Capital Stock, including, without limitation, the Common
Stock of the Corporation, whether now existing or hereafter created
(collectively, the "Junior Stock").
(d) (1) Subject to the rights of any Senior Preferred Stock, the
holders of the then outstanding shares of Series D Preferred Stock
shall be entitled to receive, as and when declared by the Board of
Directors, out of funds legally available for the payment of
dividends, cumulative preferential cash dividends at the annual rate
of 9% of the $100 per share liquidation preference (i.e., $9.00 per
annum per share). Such dividends shall accrue and be cumulative from
the date of original issue and shall be payable in equal quarterly
amounts in arrears on or before the last day of each March, June,
September, and December or, if such day is not a business day, the
next succeeding business day except that, if such business day is in
the next succeeding calendar year, such payment shall be made on the
immediately preceding business day, in each case with the same force
and effect as if made on such date (each, a "Dividend Payment Date")
(for the purposes of this Subparagraph (1) of this Paragraph (d), a
"business day" is any day, other than a Saturday, Sunday, or legal
holiday, on which banks in Detroit, Michigan, are open for business).
The first dividend may be for less than a full quarter. All dividends
on the Series D Preferred Stock, including any dividend for any
partial dividend period, shall be computed on the basis of a 360-day
year consisting of twelve 30-day months. Dividends will be payable to
holders of record as they appear in the stock records of the
Corporation at the close of business on the applicable record date,
which shall be the 15th day of the calendar month in which the
applicable Dividend Payment Date falls or on such other date designed
by the Board of Directors of the Corporation for the payment of
dividends that is not more than 30 nor less than ten days prior to
such Dividend Payment Date (each, a "Dividend Record Date").
(2) No dividends on the Series D Preferred Stock shall be
declared by
18
the Board of Directors or paid or set apart for payment by the
Corporation at such time as any agreement of the Corporation,
including any agreement relating to its indebtedness, prohibits such
declaration, payment, or setting apart for payment or provides that
such declaration, payment, or setting apart for payment would
constitute a breach of, or a default under, such agreement or if such
declaration, payment, or setting aside shall be restricted or
prohibited by law.
(3) Dividends on the Series D Preferred Stock shall accrue
and be cumulative regardless of whether the Corporation has earnings,
regardless of whether there are funds legally available for the
payment of such dividends, and regardless of whether such dividends
are declared. Accrued but unpaid dividends on the Series D Preferred
Stock will accumulate as of the Dividend Payment Date on which they
first become payable. Except as set forth below in this Subparagraph
(3), no dividends shall be declared or paid or set apart for payment
on any Common Stock or any other series of Preferred Stock ranking, as
to dividends, on a parity with or junior to the Series D Preferred
Stock (other than a dividend in shares of Junior Stock) for any period
unless full cumulative dividends have been or contemporaneously are
declared and paid or declared and a sum sufficient for the payment
thereof is set apart for such payment on the Series D Preferred Stock
for all past dividend periods and the then current dividend period.
When dividends are not paid in full (and a sum sufficient for such
full payment is not so set apart) upon the Series D Preferred Stock
and the shares of any other series of Preferred Stock ranking on a
parity as to dividends with the Series D Preferred Stock, all
dividends declared upon the Series D Preferred Stock and any other
series of Preferred Stock ranking on a parity as to dividends with the
Series D Preferred Stock shall be declared pro rata, so that the
amount of dividends declared per share of Series D Preferred Stock and
such other series of Preferred Stock shall in all cases bear to each
other the same ratio that accrued dividends per share on the Series D
Preferred Stock and such other series of Preferred Stock (which shall
not include any accrual in respect of unpaid dividends for prior
dividend periods if such Preferred Stock does not have a cumulative
dividend) bear to each other. No interest shall be payable in respect
of any dividend payment on the Series D Preferred Stock that may be in
arrears. Holders of shares of the Series D Preferred Stock shall not
be entitled to any dividend, whether payable in cash, property, or
stock, in excess of full cumulative dividends on the Series D
Preferred Stock as provided above. Any dividend payment made on shares
of the Series D Preferred Stock shall first be credited against the
earliest accumulated but unpaid dividend due with respect to such
shares that remains payable.
(4) Except as provided in Subparagraph (3) of this Paragraph
(d) of this Item (iv) of this Subsection (c) of this Section 2 of this
Article III, unless full cumulative dividends on the Series D
Preferred Stock have been or contemporaneously are declared and paid
or declared and a sum sufficient for the payment thereof is set apart
for payment for all past dividend periods and the then current
dividend period: (i) no dividends (other than in shares of Junior
Stock) shall be declared or paid or set aside for payment nor shall
any other distribution be declared or made upon the Common Stock, or
the Series B Preferred Stock (or any other Preferred Stock ranking
junior to or on a parity with the Series D Preferred Stock as to
dividends or upon liquidation); and (ii) no shares of Common Stock or
the Series B Preferred Stock (or any other Preferred Stock of the
Corporation ranking junior to or on a parity with the Series D
Preferred Stock as to dividends or upon liquidation) shall be
redeemed, purchased, or otherwise acquired for any consideration (nor
shall any moneys be paid to or made available for a sinking fund for
the redemption of any such shares) by the Corporation (except by
conversion into or exchange for Junior Stock).
(5) If for any taxable year the Corporation elects to
designate as "capital gains dividends" (as defined in Section 857 of
the Code) any portion (the "Capital
19
Gains Amount") of the dividends paid or made available for the year to
holders of all classes of Capital Stock (the "Total Dividends"), then
the portion of the Capital Gains Amount that shall be allocable to the
holders of Series D Preferred Stock shall be the amount that the total
dividends paid or made available to the holders of the Series D
Preferred Stock for the year bears to the Total Dividends.
(6) Notwithstanding anything to the contrary set forth
herein, the Corporation may declare and pay a dividend on the Common
Stock, without preserving the priority of distributions described in
Subparagraphs 3 and 4 of this Paragraph (d) of this Item (iii) of this
Subsection (c) of this Section 2 of this Article III, but only to the
extent such dividends are required to preserve the Real Estate
Investment Trust status of the Corporation and to avoid the imposition
of an excise tax on the Corporation.
(e) Subject to the rights of any Senior Stock, upon any voluntary
or involuntary liquidation, dissolution or winding up of the affairs
of the Corporation, and before any distribution of assets shall be
made in respect of any Junior Stock, the holders of the Series D
Preferred Stock shall be entitled to be paid out of the assets of the
Corporation legally available for distribution to its shareholders a
liquidation preference of $100 per share in cash (or property having a
fair market value as determined by the Board of Directors valued at
$100 per share), plus an amount equal to any accrued but unpaid
dividends to the date of payment. After payment of the full amount of
the liquidating distributions to which they are entitled, the holders
of Series D Preferred Stock shall have no right or claims to any of
the remaining assets of the Corporation. Neither the consolidation or
merger of the Corporation with or into any other corporation, trust,
or entity (or of any other corporation with or into the Corporation)
nor the sale, lease, or conveyance of all or substantially all of the
property or business of the Corporation shall be deemed to constitute
a liquidation, dissolution or winding up of the Corporation for the
purpose of this Paragraph (e) of this Item (iv).
(f) (1) The Series D Preferred Stock is not redeemable prior to
November 24, 2004. On and after November 24, 2004, the Corporation, at
its option upon not less than 30 nor more than 60 days' written
notice, may redeem shares of the Series D Preferred Stock, in whole or
in part, at any time and from time to time, for a cash redemption
price of $100 per share, plus all accrued and unpaid dividends to the
date fixed for redemption (except as provided below).
(2) The redemption price of the Series D Preferred Stock
(other than the portion thereof consisting of accrued but unpaid
dividends) shall be payable solely out of the sale proceeds of other
"capital stock" of the Corporation. For purposes of the preceding
sentence, the term "capital stock" means any equity securities of the
Corporation (including Common Stock and Preferred Stock), shares,
interest, participation, or other ownership interests (however
designated) and any rights (other than debt securities convertible
into or exchangeable for equity securities) or options to purchase any
of the foregoing. Holders of Series D Preferred Stock to be redeemed
shall surrender such shares at the place designated in the notice of
redemption and shall be entitled to the redemption price and any
accrued and unpaid dividends payable upon such redemption following
such surrender. If notice of redemption has been given and if the
Corporation has set aside in trust the funds necessary for the
redemption, then from and after the redemption date: (i) dividends
shall cease to accrue on such shares of Series D Preferred Stock; (ii)
such shares of Series D Preferred Stock shall no longer be deemed
outstanding; and (iii) all rights of the holders of such shares shall
terminate, except the right to receive the redemption price. If less
than all of the outstanding Series D Preferred Stock is to be
redeemed, the Series D Preferred Stock to be redeemed shall be
selected pro rata (as nearly as may be practicable
20
without creating fractional shares) or by any other equitable method
determined by the Corporation.
(3) Unless full cumulative dividends on all shares of Series
D Preferred Stock shall have been or contemporaneously are declared
and paid or declared and a sum sufficient for the payment thereof set
apart for payment, no shares of Series D Preferred Stock shall be
redeemed unless all outstanding shares of Series D Preferred Stock are
simultaneously redeemed, and the Corporation shall not purchase or
otherwise acquire directly or indirectly any shares of Series D
Preferred Stock (except by exchange for Junior Stock); however, the
foregoing shall not prevent the purchase or acquisition of shares of
Series D Preferred Stock pursuant to a purchase or exchange offer made
on the same terms to holders of all outstanding shares of Series D
Preferred Stock.
(4) Notice of redemption shall be given by publication in a
newspaper of general circulation in The City of New York, such
publication to be made once a week for two successive weeks commencing
not less than 30 nor more than 60 days prior to the redemption date. A
similar notice shall be mailed by the Corporation, postage prepaid,
not less than 30 nor more than 60 days prior to the redemption date,
addressed to the respective holders of record of the Series D
Preferred Stock to be redeemed at their respective addresses as they
appear on the stock transfer records of the Corporation. No failure to
give or defect in such notice shall affect the validity of the
proceedings for the redemption of any shares of Series D Preferred
Stock except as to the holder to whom notice was defective or not
given. Each notice shall state: (i) the redemption date; (ii) the
redemption price; (iii) the number of shares of Series D Preferred
Stock to be redeemed; (iv) the place or places where the Series D
Preferred Stock is to be surrendered for payment of the redemption
price; and (v) that dividends on the shares to be redeemed will cease
to accrue on such redemption date. If fewer than all shares of the
Series D Preferred Stock held by any holder are to be redeemed, the
notice mailed to such holder shall also specify the number of shares
of Series D Preferred Stock to be redeemed from such holder.
(5) The holders of Series D Preferred Stock at the close of
business on a Dividend Record Date shall be entitled to receive the
dividend payable with respect to such Series D Preferred Stock on the
corresponding Dividend Payment Date notwithstanding the redemption
thereof between such Dividend Record Date and the corresponding
Dividend Payment Date or the Corporation's default in the payment of
the dividend due. Except as provided above, the Corporation will make
no payment or allowance for unpaid dividends, regardless of whether in
arrears, on called Series D Preferred Stock.
(6) The Series D Preferred Stock has no stated maturity and
no sinking fund shall be required and shall not be subject to
mandatory redemption. The Series D Preferred Stock is not convertible
into any other securities of the Corporation, but is subject to the
Excess Stock (and all other) provisions of this Article III.
(g) (1) Except as may be required by law or as otherwise
expressly provided in this Item (iv) of this Subsection (c) of this
Section 2 of this Article III, the holders of Series D Preferred Stock
shall not be entitled to vote. On all matters with respect to which
the Series D Preferred Stock is entitled to vote, each share of Series
D Preferred Stock shall be entitled to one vote.
(2) Whenever dividends on the Series D Preferred Stock are
in arrears (which shall, with respect to any quarterly dividend, mean
that any such divided has not been paid in full whether or not earned
or declared) for six or more quarterly periods (whether
21
consecutive or not), the number of directors then constituting the
Board of Directors shall be increased by two, and the holders of
Series D Preferred Stock (voting separately as a class with all other
series of Voting Parity Preferred) shall have the right to elect two
directors of the Corporation at a special meeting called by the
holders of record of at least 10% of the Series D Preferred Stock or
at least 10% of any other Voting Parity Preferred so in arrears
(unless such request is received less than 90 days before the date
fixed for the next annual or special meeting of the shareholders) or
at the next annual meeting of shareholders, and at each subsequent
annual meeting, until all dividends accumulated on the Series D
Preferred Stock for the past dividend periods and the then current
dividend period have been fully paid or declared and a sum sufficient
for the payment of such dividends has been set aside for payment. If
and when all accumulated dividends and the dividend for the then
current dividend period on the Series D Preferred Stock shall have
been paid in full or set aside for payment in full, the holders of the
Series D Preferred Stock shall be divested of the foregoing voting
rights (but subject always to the same provision for the vesting of
such voting rights in the case of any similar future arrearages in six
quarterly dividends), and if all accumulated dividends and the
dividend for the then current period have been paid in full or set
aside for payment in full on all series of Voting Parity Preferred,
the term of office of each director so elected by the holders of the
Series D Preferred Stock and the Voting Parity Preferred shall
terminate.
(3) As long as any shares of Series D Preferred Stock remain
outstanding, the Corporation shall not, without the affirmative vote
or consent of the holders of at least two-thirds of the outstanding
shares of Series D Preferred Stock (voting as a separate class); (i)
authorize or create, or increase the authorized or issued amount of,
any Capital Stock ranking senior to the Series D Preferred Stock with
respect to the payment of dividends or the distribution of assets upon
liquidation, dissolution, or winding up or reclassify any authorized
Capital Stock of the Corporation into or exchangeable for such shares,
or create, authorize, or issue any obligation or security convertible
into or evidencing the right to purchase any such shares; or (ii)
amend, alter, or repeal the provisions of these Amended and Restated
Articles of Incorporation, whether by merger, consolidation or
otherwise (an "Event"), so as to materially and adversely affect any
right, preference, privilege, or voting power of the Series D
Preferred Stock or the holders thereof; however, as long as the Series
D Preferred Stock remains outstanding with its terms materially
unchanged, taking into account that upon the occurrence of an Event,
the Corporation may not be the surviving entity, the occurrence of an
Event described in clause (ii) above of this Subparagraph (3) shall
not be deemed to materially and adversely affect such rights,
preferences, privileges, or voting power of the holders of Series D
Preferred Stock, and (x) any increase in the amount of the authorized
Preferred Stock or the creation or issuance of any other series of
Preferred Stock, or (y) any increase in the amount of authorized
shares of the Series D Preferred Stock or any other series of
Preferred Stock, in the case of either (x) or (y) ranking on a parity
with or junior to the Series D Preferred Stock with respect to payment
of dividends or the distribution of assets upon liquidation,
dissolution, or winding up, shall not be deemed to materially and
adversely affect such rights, preferences, privileges, or voting
powers.
(4) Notwithstanding the foregoing, the Series D Preferred
Stock shall not be entitled to vote, and the foregoing voting
provisions shall not apply, if at or prior to the time when the act
with respect to which such vote would otherwise be required is
effected, all outstanding shares of the Series D Preferred Stock have
been redeemed or called for redemption, and sufficient funds have been
deposited in trust for the benefit of the holders of the Series D
Preferred Stock to effect such redemption.
(d) Restrictions on Transfer.
22
(i) Definitions. The following terms shall have the following meanings
for purposes of these Amended and Restated Articles of Incorporation:
"Affiliate" and "Affiliates" mean, (i) with respect to any
individual, any member of such individual's Immediate Family, a Family
Trust with respect to such individual, and any Person (other than an
individual) in which such individual and/or his Affiliate(s) owns, directly
or indirectly, more than 50% of any class of Equity Security or of the
aggregate Beneficial Interest of all beneficial owners, or in which such
individual or his Affiliate is the sole general partner, or is the sole
managing general partner, or which is controlled by such individual and/or
his Affiliates; and (ii) with respect to any Person (other than an
individual), any Person (other than an individual) which controls, is
controlled by, or is under common control with, such Person, and any
individual who is the sole general partner or the sole managing general
partner in, or who controls, such Person. The terms "Affiliated" and
"Affiliated with" shall have the correlative meanings.
"Beneficial Interest" means an interest, whether as partner, joint
venturer, cestui que trust, or otherwise, a contract right, or a legal or
equitable position under or by which the possessor participates in the
economic or other results of the Person (other than an individual) to which
such interest, contract right, or position relates.
"Beneficial Ownership" means ownership of shares of Capital Stock
(including Capital Stock that may be acquired upon conversion of
Debentures) (i) by a Person who owns such shares of Capital Stock in his
own name or is treated as an owner of such shares of Capital Stock
constructively through the application of Section 544 of the Code, as
modified by Sections 856(h)(1)(B) and 856(h)(3)(A) of the Code; or (ii) by
a person who falls within the definition of "Beneficial Owner" under
Section 776(4) of the Act. The terms "Beneficial Owner", "Beneficially
Owns" and "Beneficially Owned" shall have the correlative meanings.
"Capital Stock" means the Common Stock and the Preferred Stock,
including shares of Common Stock and Preferred Stock that have become
Excess Stock.
"Charitable Proceeds" means the amounts due from time to time to
the Designated Charity, consisting of (i) dividends or other distributions,
including capital gain distributions (but not including liquidating
distributions not otherwise within the definition of Excess Liquidation
Proceeds), paid with respect to Excess Stock, (ii) in the case of a sale of
Excess Stock, the excess, if any, of the Net Sales Proceeds over the amount
due to the Purported Transferee as determined under Item (iii)(b) of
Subsection (e) of this Section 2 of this Article III, and (iii) in the case
of any voluntary or involuntary liquidation, dissolution or winding up of
the Corporation, the Excess Liquidation Proceeds.
"Code" means the Internal Revenue Code of 1986, as amended from
time to time.
"Constructive Ownership" means ownership of shares of Capital
Stock (including Capital Stock that may be acquired upon conversion of
Debentures) by a Person who owns such shares of Capital Stock in his own
name or would be treated as an owner of such shares of Capital Stock
constructively through the application of Section 318 of the Code, as
modified by Section 856 (d)(5) of the Code. The terms "Constructive Owner",
"Constructively Owns" and "Constructively Owned" shall have the correlative
meanings.
"Control(s)" (and its correlative terms "Controlled By" and "Under
Common Control With") means, with respect to any Person (other than an
individual), possession by the applicable Person or Persons of the power,
acting alone (or solely among such applicable Person or Persons, acting
together), to designate and direct or cause the designation and direction
of the
23
management and policies thereof, whether through the ownership of voting
securities, by contract, or otherwise.
"Debentures" means any convertible debentures or other convertible
debt securities issued by the Corporation from time to time.
"Demand" means the written notice to the Purported Transferee
demanding delivery to the Designated Agent of (i) all certificates or other
evidence of ownership of shares of Excess Stock and (ii) Excess Share
Distributions. Any reference to "the date of the Demand" means the date
upon which the Demand is mailed or otherwise transmitted by the
Corporation.
"Designated Agent" means the agent designated by the Board of
Directors, from time to time, to act as attorney-in-fact for the Designated
Charity and to take delivery of certificates or other evidence of ownership
of shares of Excess Stock and Excess Share Distributions from a Purported
Transferee.
"Designated Charity" means any one or more organizations described
in Sections 501(c)(3) and 170(c) of the Code, as may be designated by the
Board of Directors from time to time to receive any Charitable Proceeds.
"Equity Security" has the meaning ascribed to it in the Securities
Exchange Act of 1934, as amended from time to time, and the rules and
regulations thereunder (and any successor laws, rules and regulations of
similar import).
"Excess Liquidation Proceeds" means, with respect to shares of
Excess Stock, the excess, if any, of (i) the amount which would have been
due to the Purported Transferee pursuant to Subsection (a)(ii) of this
Section 2 of this Article III with respect to such stock in the case of any
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation if the Transfer had been valid under Item (ii) of this
Subsection (d) of this Section 2 of this Article III, over (ii) the amount
due to the Purported Transferee as determined under Item (iii)(b)(2) of
Subsection (e) of this Section 2 of this Article III.
"Excess Share Distributions" means dividends or other
distributions, including, without limitation, capital gain distributions
and liquidating distributions, paid with respect to shares of Excess Stock.
"Excess Stock" means shares of Common Stock and shares of
Preferred Stock that have been automatically converted to Excess Stock
pursuant to the provisions of Item (iii) of this Subsection (d) of this
Section 2 of this Article III, and which are subject to the provisions of
Subsection (e) of this Section 2 of this Article III.
"Existing Holder" means (i) the General Motors Hourly-Rate
Employes Pension Trust, (ii) the General Motors Salaried Employes Pension
Trust (such trusts referred to in (i) or (ii) are hereinafter referred to
as "GMPTS"), (iii) the AT&T Master Pension Trust, (iv) any nominee of the
foregoing, and (v) any Person to whom an Existing Holder transfers
Beneficial Interest of Regular Capital Stock if (x) the result of such
transfer would be to cause the transferee to Beneficially Own shares of
Regular Capital Stock in excess of the greater of the Ownership Limit or
any pre-existing Existing Holder Limit with respect to such transferee
(such excess being herein referred to as the "Excess Amount") and (y) the
transferor Existing Holder, by notice to the Corporation in connection with
such transfer, designates such transferee as a successor Existing Holder
(it being understood that, upon any such transfer, the Existing Holder
Limit for the transferor Existing Holder shall be reduced by the Excess
Amount and the then applicable Ownership Limit or Existing Holder Limit for
the transferee Existing Holder shall be increased by such Excess
24
Amount).
"Existing Holder Limit" (i) for any Existing Holder who is an
Existing Holder by virtue of Clauses (i) and (ii) of the definition thereof
means the greater of (x) 9.9% of the outstanding Capital Stock, reduced
(but not below the Ownership Limit) by any Excess Amount transferred in
accordance with clause (v) of the definition of Existing Holder and (y)
4,365,713 shares of Regular Capital Stock (as adjusted to reflect any
increase in the number of outstanding shares as the result of a stock
dividend or any increase or decrease in the number of outstanding shares
resulting from a stock split or reverse stock split), reduced (but not
below the Ownership Limit) by any Excess Amount transferred in accordance
with clause (v) of the definition of Existing Holder, (ii) for any Existing
Holder who is an Existing Holder by virtue of Clause (iii) of the
definition thereof means the greater of (x) 13.74% of the outstanding
Capital Stock, reduced (but not below the Ownership Limit) by any Excess
Amount transferred in accordance with clause (v) of the definition of
Existing Holder and (y) 6,059,080 shares of Regular Capital Stock (as
adjusted to reflect any increase in the number of outstanding shares as the
result of a stock dividend or any increase or decrease in the number of
outstanding shares resulting from a stock split or reverse stock split),
reduced (but not below the Ownership Limit) by any Excess Amount
transferred in accordance with Clause (v) of the definition of Existing
Holder, (iii) for any Existing Holder who is an Existing Holder by virtue
of Clause (iv) of the definition thereof means the percentage of the
outstanding Capital Stock or the number of shares of the outstanding
Regular Capital Stock that the Beneficial Owner for whom the Existing
Holder is acting as nominee is permitted to own under this definition, and
(iv) for any Existing Holder who is an Existing Holder by virtue of Clause
(v) of the definition thereof means the greater of (x) a percentage of the
outstanding Capital Stock equal to the Ownership Limit or pre-existing
Existing Holder Limit applicable to such Person plus the Excess Amount
transferred to such Person pursuant to clause (v) of the definition of
Existing Holder and (y) the number of shares of outstanding Regular Capital
Stock equal to the Ownership Limit or pre-existing Existing Holder Limit
applicable to such Person plus the Excess Amount transferred to such Person
pursuant to clause (v) of the definition of Existing Holder.
"Family Trust" means, with respect to an individual, a trust for
the benefit of such individual or for the benefit of any member or members
of such individual's Immediate Family or for the benefit of such individual
and any member or members of such individual's Immediate Family (for the
purpose of determining whether or not a trust is a Family Trust, the fact
that one or more of the beneficiaries (but not the sole beneficiary) of the
trust includes a Person or Persons, other than a member of such
individual's Immediate Family, entitled to a distribution after the death
of the settlor if he, she, it, or they shall have survived the settlor of
such trust and/or includes an organization or organizations exempt from
federal income taxes pursuant to the provisions of Section 501(a) of the
Code and described in Section 501(c)(3) of the Code, shall be disregarded);
provided, however, that in respect of transfers by way of testamentary or
inter vivos trust, the trustee or trustees shall be solely such individual,
a member or members of such individual's Immediate Family, a responsible
financial institution and/or an attorney that is a member of the bar of any
state in the United States.
"Immediate Family" means, with respect to a Person, (i) such
Person's spouse (former or then current), (ii) such Person's parents and
grandparents, and (iii) ascendants and descendants (natural or adoptive, of
the whole or half blood) of such Person's parents or of the parents of such
Person's spouse (former or then current).
"Look Through Entity" means any Person that (i) is not an
individual or an organization described in Sections 401(a), 501(c)(17), or
509(a) of the Code or a portion of a trust permanently set aside or to be
used exclusively for the purposes described in Section 642(c) of the Code
or a corresponding provision of a prior income tax law, and (ii) provides
the Corporation with (a) a written affirmation and undertaking, subject
only to such exceptions as are acceptable to the
25
Corporation in its sole discretion, that (x) it is not an organization
described in Sections 401(a), 501(c)(17) or 509(a) of the Code or a portion
of a trust permanently set aside or to be used exclusively for the purposes
described in Section 642(c) of the Code or a corresponding provision of a
prior income tax law, (y) after the application of the rules for
determining stock ownership, as set forth in Section 544(a) of the Code, as
modified by Sections 856(h)(1)(B) and 856(h)(3)(A) of the Code, no
"individual" would own, Beneficially or Constructively, more than the
then-applicable Ownership Limit, taking into account solely for the purpose
of determining such "individual's" ownership for the purposes of this
clause (y) (but not for determining whether such "individual" is in
compliance with the Ownership Limit for any other purpose) only such
"individual's" Beneficial and Constructive Ownership derived solely from
such Person and (z) it does not Constructively Own 10% or more of the
equity of any tenant with respect to real property from which the
Corporation or TRG receives or accrues any rent from real property, and (b)
such other information regarding the Person that is relevant to the
Corporation's qualifications to be taxed as a REIT as the Corporation may
reasonably request.
"Market Price" means, with respect to any class or series of
shares of Regular Capital Stock, the last reported sales price of such
class or series of shares reported on the New York Stock Exchange on the
trading day immediately preceding the relevant date, or if such class or
series of shares of Regular Capital Stock is not then traded on the New
York Stock Exchange, the last reported sales price of such class or series
of shares on the trading day immediately preceding the relevant date as
reported on any exchange or quotation system over which such class or
series of shares may be traded, or if such class or series of shares of
Regular Capital Stock is not then traded over any exchange or quotation
system, then the market price of such class or series of shares on the
relevant date as determined in good faith by the Board of Directors of the
Corporation.
"Net Sales Proceeds" means the gross proceeds received by the
Designated Agent upon a sale of Regular Capital Stock that has become
Excess Stock, reduced by (i) all expenses (including, without limitation,
any legal expenses or fees) incurred by the Designated Agent in obtaining
possession of (x) the certificates or other evidence of ownership of the
Regular Capital Stock that had become Excess Stock and (y) any Excess Share
Distributions, and (ii) any expenses incurred in selling or transferring
such shares (including, without limitation, any brokerage fees,
commissions, stock transfer taxes or other transfer fees or expenses).
"Ownership Limit" means 8.23% of the value of the outstanding
Capital Stock of the Corporation.
"Person" means (a) an individual, corporation, partnership,
estate, trust (including a trust qualified under Section 401(a) or
501(c)(17) of the Code), a portion of a trust permanently set aside for or
to be used exclusively for the purposes described in Section 642(c) of the
Code, association, private foundation within the meaning of Section 509(a)
of the Code, joint stock company or other entity and (b) also includes a
group as that term is used for purposes of Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended from time to time, and the
rules and regulations thereunder (and any successor laws, rules and
regulations of similar import).
"Purported Transferee" means, with respect to any purported
Transfer which results in Excess Stock, the purported beneficial transferee
for whom the shares of Regular Capital Stock would have been acquired if
such Transfer had been valid under Item (ii) of this Subsection (d) of this
Section 2 of this Article III.
"Regular Capital Stock" means shares of Common Stock and Preferred
Stock that are not Excess Stock.
"REIT" means a Real Estate Investment Trust defined in Section 856
of the Code.
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"Transfer" means any sale, transfer, gift, assignment, devise or
other disposition of Capital Stock, (including (i) the granting of any
option or entering into any agreement for the sale, transfer or other
disposition of Capital Stock or (ii) the sale, transfer, assignment or
other disposition of any securities or rights convertible into or for
Capital Stock), whether voluntary or involuntary, whether of record or
beneficial ownership, and whether by operation of law or otherwise.
(ii) Restriction on Transfers.
(a) Except as provided in Item (viii) of this Subsection (d) of
this Section 2 of this Article III, no Person (other than an Existing
Holder) shall Beneficially Own or Constructively Own shares of Capital
Stock having an aggregate value in excess of the Ownership Limit, and
No Existing Holder shall Beneficially Own or Constructively Own shares
of Capital Stock in excess of the Existing Holder Limit for such
Existing Holder.
(b) Except as provided in Item (viii) of this Subsection (d) of
this Section 2 of this Article III, any Transfer that, if effective,
would result in any Person (other than an Existing Holder)
Beneficially Owning or Constructively Owning shares of Regular Capital
Stock having an aggregate value in excess of the Ownership Limit shall
be void ab initio as to the Transfer of such shares which would be
otherwise Beneficially Owned or Constructively Owned by such Person in
excess of the Ownership Limit, and the intended transferee shall
acquire no rights in such shares.
(c) Except as provided in Item (viii) of this Subsection (d) of
this Section 2 of this Article III, any Transfer that, if effective,
would result in any Existing Holder Beneficially Owning or
Constructively Owning shares of Regular Capital Stock in excess of the
applicable Existing Holder Limit shall be void ab initio as to the
Transfer of such shares which would be otherwise Beneficially Owned or
Constructively Owned by such Existing Holder in excess of the
applicable Existing Holder Limit, and such Existing Holder shall
acquire no rights in such shares.
(d) Except as provided in Item (viii) of this Subsection (d) of
this Section 2 of this Article III, any Transfer that, if effective,
would result in the Capital Stock being beneficially owned by fewer
than 100 Persons (determined without reference to any rules of
attribution) shall be void ab initio as to the Transfer of such shares
which would be otherwise beneficially owned by the transferee, and the
intended transferee shall acquire no rights in such shares.
(e) Any Transfer that, if effective, would result in the
Corporation being "closely held" within the meaning of Section 856(h)
of the Code shall be void ab initio as to the Transfer of the shares
of Regular Capital Stock which would cause the Corporation to be
"closely held" within the meaning of Section 856(h) of the Code, and
the intended transferee shall acquire no rights in such shares.
(f) In determining the shares which any Person Beneficially Owns
(or would Beneficially Own following a purported Transfer) or
Constructively Owns (or would Constructively Own following a purported
Transfer) for purposes of applying the limitations contained in
Paragraphs (a), (b), (c), (d) and (e) of this Item (ii) of this
Subsection (d) of this Article III:
(1) shares of Capita Stock that may be acquired upon
conversion of Debentures Beneficially Owned or Constructively Owned by
such Person, but not shares of Capital Stock issuable upon conversion
of Debentures held by others, are deemed to be
27
outstanding.
(2) a pension trust shall be treated as owning all shares of
Capital Stock (including Capital Stock that may be acquired upon
conversion of Debentures) as are (x) owned in its own name or with
respect to which it is treated as an owner constructively through the
application of Section 544 of the Code as modified by Section
856(h)(1)(B) of the Code but not by Section 856(h)(3)(A) of the Code
and (y) owned by, or treated as owned by, constructively through the
application of Section 544 of the Code as modified by Section
856(h)(1)(B) of the Code but not by Section 856(h)(3)(A) of the Code,
all pension trusts sponsored by the same employer as such pension
trust or sponsored by any of such employer's Affiliates.
Notwithstanding the foregoing, (y) above shall not apply in the case
of either Motors Insurance Corporation and its subsidiaries
(collectively, "MIC") or any pension trusts sponsored by the General
Motors Corporation, a Delaware corporation ("GMC"), or the American
Telephone and Telegraph Company, a New York corporation ("AT&T"), or
by any of their respective Affiliates, provided that with respect to
MIC and each such pension trust sponsored by GMC, AT&T or any of their
respective Affiliates, other than the Existing Holders described in
(i) through (iii) in the definition thereof, all of the following
conditions are met: (i) each such pension trust is administered, and
will continue to be administered, by persons who do not serve in an
administrative or other capacity to any other such pension trust
sponsored by GMC or any Affiliate of GMC or AT&T or any Affiliate of
AT&T, as applicable, including the Existing Holders described in (i)
through (iv) in the definition thereof, (it being understood that the
fact that any two such pension trusts may have in common one or more,
but less than a majority, of the persons having ultimate investment
authority for such pension trusts shall not cause such trusts to be
treated as one Person, provided that they are otherwise separately
administered as hereinbefore described), (ii) day to day investment
decisions with respect to MIC are made by a person or persons
different than the person or persons who make such decisions for the
pension trusts sponsored by GMC or its affiliates, including the
Existing Holders described in (i), (ii) and, in respect of (i) and
(ii), item (iv) in the definition thereof, (although MIC and the
pension trusts sponsored by GMC may have in common the person or
persons with ultimate investment authority for such entities), and the
investment of MIC in the Corporation does not exceed 2% of the value
of the outstanding Capital Stock of the Corporation, (iii) neither MIC
nor any such pension trust acts or will act, in concert with MIC, any
other pension trust sponsored by GMC or any Affiliate of GMC or AT&T
or any Affiliate of AT&T, as applicable, including the Existing
Holders described in (i) through (iv) in the definition thereof, with
respect to its investment in the Corporation, and (iv) as from time to
time requested by the Corporation, MIC and each pension trust shall
provide the Corporation with a representation and undertaking in
writing to the foregoing effect.
(3) If there are two or more classes of stock then
outstanding, the total value of the outstanding Capital Stock shall be
allocated among the different classes and series according to the
relative value of each class or series, as determined by reference to
the Market Price per share of each such class or series, using the
date on which the Transfer occurs as the relevant date, or the
effective date of the change in capital structure as the relevant
date, as appropriate.
(g) If any shares are transferred resulting in a violation of the
Ownership Limit or Paragraphs (b), (c), (d) or (e) of this Item (ii)
of this Subsection (d) of this Section 2 of this Article III, such
Transfer shall be valid only with respect to such amount of shares
transferred as does not result in a violation of such limitations, and
such Transfer otherwise shall be null and void ab initio.
28
(iii) Conversion to Excess Stock.
(a) If, notwithstanding the other provisions contained in
this Article III, at any time there is a purported Transfer or
other change in the capital structure of the Corporation such
that any Person (other than an Existing Holder) would
Beneficially Own or any Person (other than an Existing Holder)
would Constructively Own shares of Regular Capital Stock in
excess of the Ownership Limit, or that any Person who is an
Existing Holder would Beneficially Own or any Person who is an
Existing Holder would Constructively Own shares of Regular
Capital Stock in excess of the Existing Holder Limit, then,
except as otherwise provided in Item (viii) of this Subsection
(d) of this Section 2 of this Article III, such shares of Common
Stock or Preferred Stock, or both, in excess of the Ownership
Limit or Existing Holder Limit, as the case may be, (rounded up
to the nearest whole share) shall automatically become Excess
Stock. Such conversion shall be effective as of the close of
business on the business day prior to the date of the Transfer or
change in capital structure.
(b) If, notwithstanding the other provisions contained in
this Article III, at any time, there is a purported Transfer or
other change in the capital structure of the Corporation which,
if effective, would cause the Corporation to become "closely
held" within the meaning of Section 856(h) of the Code then the
shares of Common Stock or Preferred Stock, or both, being
Transferred which would cause the Corporation to be "closely
held" within the meaning of Section 856(h) of the Code or held by
a Person in excess of that Person's Ownership Limit or Existing
Holder Limit, as applicable (rounded up to the nearest whole
share) shall automatically become Excess Stock. Such conversion
shall be effective as of the close of business on the business
day prior to the date of the Transfer or change in capital
structure.
(c) Shares of Excess Stock shall be issued and outstanding
stock of the Corporation. The Purported Transferee shall have no
rights in such shares of Excess Stock except as provided in
Subsection (e) of this Section 2 of this Article III.
(iv) Notice of Restricted Transfer. Any Person who acquires or
attempts to acquire shares in violation of Item (ii) of this
Subsection (d) of this Section 2 of this Article III, or any Person
who is a transferee such that Excess Stock results under Item (iii) of
this Subsection (d) of this Section 2 of this Article III, shall
immediately give written notice to the Corporation of such event and
shall provide to the Corporation such other information as the
Corporation may request regarding such Person's ownership of Capital
Stock.
(v) Owners Required to Provide Information.
(a) Every Beneficial Owner of more than 5% (or such other
percentage, as provided in the applicable regulations adopted
under Sections 856 through 859 of the Code) of the outstanding
shares of the Capital Stock of the Corporation shall, within 30
days after January 1 of each year, give written notice to the
Corporation stating the name and address of such Beneficial
Owner, the number of shares Beneficially Owned and Constructively
Owned, and a full description of how such shares are held. Every
Beneficial Owner shall, upon demand by the Corporation, disclose
to the Corporation in writing such additional information with
respect to the Beneficial Ownership and Constructive Ownership of
the Capital Stock as the Board of Directors deems appropriate or
necessary (i) to comply with the provisions of the Code,
regarding the qualification of the Corporation as a REIT under
the Code, and (ii) to ensure compliance with the Ownership Limit
or the Existing Holder Limit.
29
(b) Any Person who is a Beneficial Owner or Constructive
Owner of shares of Capital Stock and any Person (including the
shareholder of record) who is holding Capital Stock for a
Beneficial Owner or Constructive Owner, and any proposed
transferee of shares, upon the determination by the Board of
Directors to be reasonably necessary to protect the status of the
Corporation as a REIT under the Code, shall provide a statement
or affidavit to the Corporation, setting forth the number of
shares of Capital Stock already Beneficially Owned or
Constructively Owned by such shareholder or proposed transferee
and any related person specified, which statement or affidavit
shall be in the form prescribed by the Corporation for that
purpose.
(vi) Remedies Not Limited. Subject to Subsection (h) of this
Section 2 of this Article III, nothing contained in this Article III
shall limit the authority of the Board of Directors to take such other
action as it deems necessary or advisable (i) to protect the
Corporation and the interests of its shareholders in the preservation
of the Corporation's status as a REIT, and (ii) to insure compliance
with the Ownership Limit and the Existing Holder Limit.
(vii) Determination. Any question regarding the application of
any of the provisions of this Subsection (d) of this Section 2 of this
Article III, including any definition contained in Item (i) of this
Subsection (d) of this Section 2 of this Article III, shall be
determined or resolved by the Board of Directors and any such
determination or resolution shall be final and binding on the
Corporation, its shareholders, and all parties in interest.
(viii) Exceptions. The Board of Directors, upon advice from, or
an opinion from, Counsel, may exempt a Person from the Ownership Limit
if such Person is a Look Through Entity, provided, however, in no
event may any such exception cause such Person's ownership, direct or
indirect (without taking into account such Person's ownership of
interests in TRG), to exceed 9.9% of the value of the outstanding
Capital Stock.
For a period of 90 days following the purchase of Regular
Capital Stock by an underwriter that (i) is a Look Through Entity and
(ii) participates in a public offering of the Regular Capital Stock,
such underwriter shall not be subject to the Ownership Limit with
respect to the Regular Capital Stock purchased by it as a part of such
public offering.
(e) Excess Stock.
(i) Surrender of Excess Stock to Designated Agent. Within thirty
business days of the date upon which the Corporation determines that
shares have become Excess Stock, the Corporation, by written notice to
the Purported Transferee, shall demand that any certificate or other
evidence of ownership of the shares of Excess Stock be immediately
surrendered to the Designated Agent (the "Demand").
(ii) Excess Share Distributions. The Designated Agent shall be
entitled to receive all Excess Share Distributions. The Purported
Transferee of Regular Capital Stock that has become Excess Stock shall
not be entitled to any dividends or other distributions, including,
without limitation, capital gain distributions, with respect to the
Excess Stock. Any Excess Share Distributions paid to a Purported
Transferee shall be remitted to the Designated Agent within thirty
business days after the date of the Demand.
30
(iii) Restrictions on Transfer; Sale of Excess Stock.
(a) Excess Stock shall be transferable by the Designated
Agent as attorney-in-fact for the Designated Charity. Excess
Stock shall not be transferable by the Purported Transferee.
(b) Upon delivery of the certificates or other evidence of
ownership of the shares of Excess Stock to the Designated Agent,
the Designated Agent shall immediately sell such shares in an
arms-length transaction (over the New York Stock Exchange or such
other exchange over which the shares of the applicable class or
series of Regular Capital Stock may then be traded, if
practicable), and the Purported Transferee shall receive from the
Net Sales Proceeds, the lesser of:
(1) the Net Sales Proceeds; or
(2) the price per share that such Purported Transferee
paid for the Regular Capital Stock in the purported Transfer that
resulted in the Excess Stock, or if the Purported Transferee did
not give value for such shares (because the Transfer was, for
example, through a gift, devise or other transaction), a price
per share equal to the Market Price determined using the date of
the purported Transfer that resulted in the Excess Stock as the
relevant date.
(c) If some or all of the shares of Excess Stock have been
sold prior to receiving the Demand, such sale shall be deemed to
been made for the benefit of and as the agent for the Designated
Charity. The Purported Transferee shall pay to the Designated
Agent, within thirty business days of the date of the Demand, the
entire gross proceeds realized upon such sale. Notwithstanding
the preceding sentence, the Designated Agent may grant written
permission to the Purported Transferee to retain an amount from
the gross proceeds equal to the amount the Purported Transferee
would have been entitled to receive had the Designated Agent sold
the shares as provided in Item (iii)(b) of this Subsection (e) of
this Section 2 of this Article III.
(d) The Designated Agent shall promptly pay to the
Designated Charity any Excess Share Distributions recovered by
the Designated Agent and the excess, if any, of the Net Sales
Proceeds over the amount due to the Purported Transferee as
provided in Item (iii)(b) of this Subsection (e) of this Section
2 of this Article III.
(iv) Voting Rights. The Designated Agent shall have the exclusive
right to vote all shares of Excess Stock as the attorney-in-fact for
the Designated Charity. The Purported Transferee shall not be entitled
to vote such shares (except as required by applicable law).
Notwithstanding the foregoing, votes erroneously cast by a Prohibited
Transferee shall not be invalidated in the event that the Corporation
has already taken irreversible corporate action to effect a
reorganization, merger, sale or dissolution of the Corporation.
(v) Rights Upon Liquidation. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of, or any
distribution of the assets of the Corporation, a Purported Transferee
shall be entitled to receive the lesser of (i) that amount which would
have been due to such Purported Transferee had the Designated Agent
sold the shares of Excess Stock as provided in Item (iii)(b) of this
Subsection (e) of this Section 2 of this Article III and (ii) that
amount which would have been due to the Purported Transferee if the
Transfer had been valid under Item (ii) of Subsection (d) of this
Section 2 of this Article III, determined (A) in the case of Common
Stock, pursuant to Subsection (a)(ii) of this Section 2 of this
Article III, and (B) in the case of Preferred Stock, pursuant to the
provisions of these Amended and Restated Articles of Incorporation,
amended as authorized by Section 1 of this Article III, which sets
forth the liquidation rights of such class or
31
series of Preferred Stock. With respect to shares of Excess Stock, a
Purported Transferee shall not have any rights to share in the assets
of the Corporation upon the liquidation, dissolution or winding up of
the Corporation other than the right to receive the amount determined
in the preceding sentence and shall not be entitled to any preference
or priority (as a creditor of the Corporation) over the holders of the
shares of Regular Capital Stock. Any Excess Liquidation Proceeds shall
be paid to the Designated Charity.
(vi) Action by Corporation to Enforce Transfer Restrictions. If
the Purported Transferee fails to deliver the certificates or other
evidence of ownership and all Excess Share Distributions to the
Designated Agent within thirty business days of the date of Demand,
the Corporation shall take such legal action to enforce the provisions
of this Article III as may be permitted under applicable law.
(f) Legend. Each certificate for Capital Stock shall bear the
following legend:
"The Amended and Restated Articles of Incorporation, as the
same may be amended (the "Articles"), impose certain
restrictions on the transfer and ownership of the shares
represented by this Certificate based upon the percentage of
the outstanding shares owned by the shareholder. At no charge,
any shareholder may receive a written statement of the
restrictions on transfer and ownership that are imposed by the
Articles."
(g) Severability. If any provision of this Article III or any
application of any such provision is determined to be invalid by any
Federal or state court having jurisdiction over the issues, the validity of
the remaining provisions shall not be affected and other applications of
such provision shall be affected only to the extent necessary to comply
with the determination of such court.
(h) New York Stock Exchange Settlement. Nothing contained in these
Amended and Restated Articles of Incorporation shall preclude the
settlement of any transaction entered into through the facilities of the
New York Stock Exchange or of any other stock exchange on which shares of
the Common Stock or class or series of Preferred Stock may be listed, or of
the Nasdaq National Market (if the shares are quoted on such Market) and
which has conditioned such listing or quotation on the inclusion in the
Corporation's Amended and Restated Articles of Incorporation of a provision
such as this Subsection (h). The fact that the settlement of any
transaction is permitted shall not negate the effect of any other provision
of this Article III and any transferee in such a transaction shall be
subject to all of the provisions and limitations set forth in this Article
III.
ARTICLE IV
Registered Office and Registered Agent
1. Registered Office.
The address and mailing address of the registered office of the Corporation
is 500 North Woodward Avenue, Suite 100, Bloomfield Hills, Michigan 48304.
2. Resident Agent.
The resident agent for service of process on the Corporation at the
registered office is Jeffrey H. Miro.
ARTICLE V
Plan of Compromise or Reorganization
32
When a compromise or arrangement or a plan of reorganization of the
Corporation is proposed between the Corporation and its creditors or any class
of them or between the Corporation and its shareholders or any class of them, a
court of equity jurisdiction within the State of Michigan, on application of the
Corporation or of a creditor or shareholder thereof, or on application of a
receiver appointed for the Corporation, may order a meeting of the creditors or
class of creditors or of the shareholders or class of shareholders to be
affected by the proposed compromise or arrangement or reorganization, to be
summoned in such manner as the court directs. If a majority in number
representing 75% in value of the creditors or class of creditors, or of the
shareholders or class of shareholders to be affected by the proposed compromise
or arrangement or a reorganization, agree to a compromise or arrangement or a
reorganization of the Corporation as a consequence of the compromise or
arrangement, the compromise or arrangement and the reorganization, if sanctioned
by the court to which the application has been made, shall be binding on all the
creditors or class of creditors, or on all the shareholders or class of
shareholders and also on the Corporation.
ARTICLE VI
Directors
For so long as the Corporation has the right to designate, pursuant to The
Amended and Restated Agreement of Limited Partnership of TRG (as the same may be
amended, the Partnership Agreement"), members of the committee of TRG that have
the power to approve or propose all actions, decisions, determinations,
designations, delegations, directions, appointments, consents, approvals,
selections, and the like to be taken, made or given, with respect to TRG, its
business and its properties as well as the management of all affairs of TRG (the
"Partnership Committee"), the Board of Directors shall consist of, except during
the period of any vacancy between annual meetings of the shareholders, that
number of members as are set forth in the By-Laws of the Corporation of which,
except during the period of any vacancy between annual meetings of the
shareholders, not less than 40% (rounded up to the next whole number) of the
members shall be Independent Directors (as hereinafter defined), and,
thereafter, the Board of Directors shall consist of, except during the period of
any vacancy between annual meetings of the shareholders, that number of members
as are set forth in the By-Laws of the Corporation. For purposes of this Article
VI, "Independent Director" shall mean an individual who is neither one of the
following named persons nor an employee, beneficiary, principal, director,
officer or agent of, or a general partner in, or limited partner (owning in
excess of 5% of the Beneficial Interest) or shareholder (owning in excess of 5%
of the Beneficial Interest) in, any such named Person: (i) for so long as TG
Partners Limited Partnership, a Delaware limited partnership, has the right to
appoint one or more Partnership Committee members, A. Alfred Taubman and any
Affiliate of A. Alfred Taubman or any member of his Immediate Family, (ii) for
so long as Taub-Co Management, Inc., a Michigan corporation (formerly The
Taubman Company, Inc. ("T-Co")) has the right to appoint one or more Partnership
Committee members, T-Co or an Affiliate of T-Co, (iii) for so long as a Taubman
Transferee (as hereinafter defined) has the right to appoint one or more
Partnership Committee members, a Taubman Transferee, or an Affiliate of such
Taubman Transferee, (iv) for so long as GMPTS has the right to appoint one or
more Partnership Committee members, GMPTS, General Motors Corporation, or an
Affiliate of GMPTS or of General Motors Corporation, and (v) for so long as a
GMPTS Transferee (as hereinafter defined) has the right to appoint one or more
Partnership Committee members, a GMPTS Transferee or an Affiliate of such GMPTS
Transferee. "Taubman Transferee" means a single Person that acquires, pursuant
to Section 8.1(b) or Section 8.3(a) of The Partnership Agreement, or upon the
foreclosure or like action in respect of a pledge of a partnership interest in
TRG, the then (i.e., at the time of such acquisition) entire partnership
interest in TRG (excluding, in the case of an acquisition pursuant to Section
8.3(a) of the Partnership Agreement or pursuant to a foreclosure or like action
in respect of a pledge of a partnership interest in TRG, the ability of such
Person to act as a substitute partner) of A. Alfred Taubman, and any Affiliate
of A. Alfred Taubman or any member of his Immediate Family, from one or more
such persons or from any Taubman Transferee; provided that the percentage
interest in TRG being transferred exceeds 7.7%. "GMPTS Transferee" means a
single Person that acquires, pursuant to Section 8.1(b) or Section 8.3(a) of the
Partnership Agreement, or upon the foreclosure or like action in respect of a
pledge of a partnership interest in TRG, the then (i.e., at the time of such
acquisition) entire such partnership interest in TRG (excluding, in the case of
an acquisition pursuant
33
to Section 8.3(a) of the Partnership Agreement or pursuant to a foreclosure or
like action in respect of a pledge of partnership interests in TRG, the ability
of such Person to act as a substitute partner) of GMPTS or of any GMPTS
Transferee; provided that the percentage interest in TRG being transferred
exceeds 7.7%.
For so long as the Corporation has the right to designate, pursuant to the
Partnership Agreement, any members of the Partnership Committee, the affirmative
vote of both a majority of the Independent Directors who do not have a
beneficial financial interest in the action before the Board of Directors and a
majority of all members of the Board of Directors who do not have a beneficial
financial interest in the action before the Board of Directors is required for
the approval of all actions to be taken by the Board of Directors; provided,
however, the Corporation may not appoint to the Partnership Committee as a
Corporation appointee an individual who does not satisfy the definition of
Independent Director in one or more respects without the affirmative vote of all
of the Independent Directors then in office. Thereafter, the affirmative vote of
a majority of all members of the Board of Directors who do not have a beneficial
financial interest in the action before the Board of Directors is required for
the approval of all actions to be taken by the Board of Directors. The
establishment of reasonable compensation of Directors for services to the
Corporation as Directors or officers shall not constitute action in which any
Director has a beneficial financial interest.
Subject to the foregoing, a Director shall be deemed and considered in all
respects and for all purposes to be a Director of the Corporation, including,
without limitation, having the authority to vote or act on all matters,
including, without limitation, matters submitted to a vote at any meeting of the
Board of Directors or at any meeting of a committee of the Board of Directors,
and the application to such Director of Articles VII and VIII of these Amended
and Restated Articles of Incorporation, notwithstanding a Purported Transferee's
unauthorized exercise of voting rights with respect to such Director's election.
ARTICLE VII
Limited Liability of Directors
No director of the Corporation shall be liable to the Corporation or its
shareholders for monetary damages for a breach of the director's fiduciary duty;
provided, however, the foregoing provision shall not be deemed to limit a
director's liability to the Corporation or its shareholders resulting from:
(i) a breach of the director's duty of loyalty to the
Corporation or its shareholders;
(ii) acts or omissions of the director not in good faith or which
involve intentional misconduct or knowing violation of law;
(iii)a violation of Section 551(1) of the Act or;
(iv) a transaction from which the director derived an improper
personal benefit.
ARTICLE VIII
Indemnification of Officers, Directors, Etc.
1. Indemnification of Directors.
The Corporation shall and does hereby indemnify a person (including the
heirs, executors, and administrators of such person) who is or was a party to,
or who is threatened to be made a party to, a threatened, pending, or completed
action, suit, or proceeding, whether civil, criminal, administrative, or
investigative and whether formal or informal, including, without limitation, an
action by or in the right of the Corporation, by reason of the fact that he or
she is or was a director of the Corporation, or is or was serving at the request
of the Corporation as a director (or in a similar capacity, including serving as
a member of the Partnership Committee and of any other committee of TRG) or in
any other representative capacity of another foreign or domestic corporation or
of or with respect to any other entity (including TRG), whether
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for profit or not, against expenses, attorneys' fees, judgments, penalties,
fines, and amounts paid in settlement actually and reasonably incurred by him or
her in connection with the action, suit, or proceeding. This Section 1 of this
Article VIII is intended to grant the persons herein described with the fullest
protection not prohibited by existing law in effect as of the date of filing
this Amended and Restated Articles of Incorporation or such greater protection
as may be permitted or not prohibited under succeeding provisions of law.
2. Indemnification of Officers, Etc.
The Corporation has the power to indemnify a person (including the heirs,
executors, and administrators of such person) who is or was a party to, or who
is threatened to be made a party to, a threatened, pending, or contemplated
action, suit, or proceeding, whether civil, criminal, administrative, or
investigative and whether formal or informal, including an action by or in the
right of the Corporation, by reason of the fact that he or she is or was an
officer, employee, or agent of the Corporation or is or was serving at the
request of the Corporation as an officer, partner, trustee, employee, or agent
of another foreign or domestic corporation, partnership (including TRG), joint
venture, trust or other enterprise, whether for profit or not, against expenses,
including attorneys' fees, judgments, penalties, fines, and amounts paid in
settlement actually and reasonably incurred by him or her in connection with the
action, suit, or proceeding, if the person acted in good faith and in a manner
he or she reasonably believed to be in or not opposed to the best interests of
the Corporation or its shareholders, and with respect to a criminal action or
proceeding, if the person had no reasonable cause to believe his or her conduct
was unlawful. Unless ordered by a court, an indemnification under this Section 2
of this Article VIII shall be made by the Corporation only as authorized in the
specific case upon a determination that indemnification of the officer,
employee, or agent is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in this Section 2 of this Article VIII.
3. Advancement of Expenses.
The Corporation shall pay the expenses incurred by a person described in
Section 1 of this Article VIII in defending a civil or criminal action, suit, or
proceeding described in such Section 1 in advance of the final disposition of
the action, suit, or proceeding. The Corporation shall pay the expenses incurred
by a person described in Section 2 of this Article VIII in defending a civil or
criminal action, suit, or proceeding described in such Section 2 in advance of
the final disposition of the action, suit, or proceeding upon receipt of an
undertaking by or on behalf of such person to repay the expenses if it is
ultimately determined that the person is not entitled to be indemnified by the
Corporation. Such undertaking shall be by unlimited general obligation of the
person on whose behalf advances are made but need not be secured.
Signed and certified as a true and complete composite as of the 9th day of
August, 2000.
/s/ ROBERT S. TAUBMAN
-------------------------------------
Robert S. Taubman
President and Chief Executive Officer
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