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EXHIBIT 3.1.3
CERTIFICATE OF DESIGNATION
of
SERIES A PARTICIPATING PREFERRED STOCK
of
CALPINE CORPORATION
(Pursuant to Section 151 of the
Delaware General Corporation Law)
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Calpine Corporation, a corporation organized and existing under
the General Corporation Law of the State of Delaware (hereinafter called the
"Corporation"), hereby certifies that the following resolution was adopted by
the Board of Directors of the Corporation as required by Section 151 of the
General Corporation Law at a meeting duly called and held on June 5, 1997:
RESOLVED, that pursuant to the authority granted to and vested in
the Board of Directors of the Corporation (hereinafter called the "Board of
Directors" or the "Board") in accordance with the provisions of the Certificate
of Incorporation, the Board of Directors hereby creates a series of Preferred
Stock, par value $0.001 per share (the "Preferred Stock"), of the Corporation
and hereby states the designation and number of shares, and fixes the relative
rights, preferences, and limitations thereof as follows:
Series A Participating Preferred Stock:
Section 1. Designation and Amount. The shares of such series
shall be designated as "Series A Participating Preferred Stock" (the "Series A
Preferred Stock") and the number of shares constituting the Series A Preferred
Stock shall be One Hundred Thousand (100,000). Such number of shares may be
increased or decreased by resolution of the Board of Directors;
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provided, however, that no decrease shall reduce the number of shares of Series
A Preferred Stock to a number less than the number of shares then outstanding
plus the number of shares reserved for issuance upon the exercise of outstanding
options, rights or warrants or upon the conversion of any outstanding securities
issued by the Corporation convertible into Series A Preferred Stock.
Section 2. Dividends and Distributions.
(A) Subject to the rights of the holders of any shares of any
series of Preferred Stock (or any similar stock) ranking prior and
superior to the Series A Preferred Stock with respect to dividends, each
holder of a share of Series A Preferred Stock, in preference to the
holders of shares of Common Stock, par value $0.001 per share (the
"Common Stock"), of the Corporation, and of any other junior stock,
shall be entitled to receive, when, as and if declared by the Board of
Directors out of funds legally available for the purpose, quarterly
dividends payable in cash on the first day of March, June, September and
December in each year (each such date being referred to herein as a
"Quarterly Dividend Payment Date"), commencing on the first Quarterly
Dividend Payment Date after the first issuance of a share or fraction of
a share of Series A Preferred Stock, in an amount per share (rounded to
the nearest cent) equal to, subject to the provision for adjustment
hereinafter set forth, One Thousand (1,000) times the aggregate per
share amount of all cash dividends, and One Thousand (1,000) times the
aggregate per share amount (payable in kind) of all non-cash dividends
or other distributions, other than a dividend payable in shares of
Common Stock or a subdivision of the outstanding shares of Common Stock
(by reclassification or otherwise), declared on the Common Stock since
the immediately preceding Quarterly Dividend Payment Date or, with
respect to the first Quarterly Dividend Payment Date, since the first
issuance of a share or fraction of a share of Series A Preferred Stock.
In the event the Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or
effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by payment
of a dividend in shares of Common Stock) into a greater or lesser number
of shares of Common Stock, then in each such case the amount to which
holders of shares of Series A Preferred Stock were entitled immediately
prior to such event under clause (b) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction, the numerator of
which is the number of shares of Common Stock outstanding immediately
after such event and the denominator of which is the number of shares of
Common Stock that were outstanding immediately prior to such event.
(B) The Corporation shall declare a dividend or distribution on
the shares of Series A Preferred Stock as provided in paragraph (A) of
this Section 2 immediately after it declares a dividend or distribution
on the Common Stock (other than a dividend payable in shares of Common
Stock); provided, however, that, in the event no dividend or
distribution shall have been declared on the Common Stock during the
period between any Quarterly Distribution Date and the next subsequent
Quarterly Dividend Payment Date,
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a dividend of $1.00 per share of Series A Preferred Stock shall
nevertheless be payable on such subsequent Quarterly Dividend Payment
Date.
(C) Dividends shall begin to accrue and be cumulative on each
outstanding share of Series A Participating Preferred Stock from the
Quarterly Dividend Payment Date next preceding the date of issue of such
share of Series A Participating Preferred Stock, unless the date of
issue of such share is prior to the record date for the first Quarterly
Dividend Payment Date, in which case dividends on such share shall begin
to accrue from the date of issue of such share, or unless the date of
issue is a Quarterly Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series A Preferred
Stock entitled to receive a quarterly dividend and before such Quarterly
Dividend Payment Date, in either of which events such dividends shall
begin to accrue and be cumulative from such Quarterly Dividend Payment
Date. Accrued but unpaid dividends shall not bear interest. Dividends
paid on the shares of Series A Preferred Stock in an amount less than
the total amount of such dividends at the time accrued and payable on
such shares shall be allocated pro rata on a share-by-share basis among
all such shares at the time outstanding. The Board of Directors may fix
a record date for the determination of holders of shares of Series A
Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be not more than
60 days prior to the date fixed for the payment thereof.
Section 3. Voting Rights. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set
forth, each share of Series A Preferred Stock shall entitle the holder
thereof to One Thousand (1,000) votes on all matters submitted to a vote
of the stockholders of the Corporation. In the event the Corporation
shall at any time declare or pay any dividend on the Common Stock
payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the outstanding shares of Common Stock
(by reclassification or otherwise than by payment of a dividend in
shares of Common Stock) into a greater or lesser number of shares of
Common Stock, then in each such case the number of votes per share to
which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event shall be adjusted by multiplying such
number by a fraction, the numerator of which is the number of shares of
Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) Except as otherwise provided herein, in any other
Certificate of Designations creating a series of Preferred Stock or any
similar stock, or by law, the holders of shares of Series A Preferred
Stock and the holders of shares of Common Stock and any other capital
stock of the Corporation having general voting rights shall vote
together as one class on all matters submitted to a vote of stockholders
of the Corporation.
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(C) (i) If at any time dividends on any shares of Series A
Preferred Stock shall be in arrears in an amount equal to six
quarterly dividends thereon, then during the period (a "default
period") from the occurrence of such event until such time as
all accrued and unpaid dividends for all previous quarterly
dividend periods and for the current quarterly dividend period
on all shares of Series A Preferred Stock then outstanding shall
have been declared and paid or set apart for payment, all
holders of shares of Series A Preferred Stock, voting separately
as a class, shall have the right to elect two (2) Directors.
(ii) During any default period, such voting rights of
the holders of shares of Series A Preferred Stock may be
exercised initially at a special meeting called pursuant to
subparagraph (iii) of this Section 3(C) or at any annual meeting
of stockholders, and thereafter at annual meetings of
stockholders, provided that neither such voting rights nor any
right of the holders of shares of Series A Preferred Stock to
increase, in certain cases, the authorized number of Directors
may be exercised at any meeting unless one-third of the
outstanding shares of Preferred Stock shall be present at such
meeting in person or by proxy. The absence of a quorum of the
holders of Common Stock shall not affect the exercise by the
holders of shares of Series A Preferred Stock of such rights. At
any meeting at which the holders of shares of Series A Preferred
Stock shall exercise such voting rights initially during an
existing default period, they shall have the right, voting
separately as a class, to elect Directors to fill up to two (2)
vacancies in the Board of Directors, if any such vacancies may
then exist, or, if such right is exercised at an annual meeting,
to elect two (2) Directors. If the number which may be so
elected at any special meeting does not amount to the required
number, the holders of the Series A Preferred Stock shall have
the right to make such increase in the number of Directors as
shall be necessary to permit the election by them of the
required number. After the holders of shares of Series A
Preferred Stock shall have exercised their right to elect
Directors during any default period, the number of Directors
shall not be increased or decreased except as approved by a vote
of the holders of shares of Series A Preferred Stock as herein
provided or pursuant to the rights of any equity securities
ranking senior to the Series A Preferred Stock.
(iii) Unless the holders of Series A Preferred Stock
shall, during an existing default period, have previously
exercised their right to elect Directors, the Board of Directors
may order, or any stockholder or stockholders owning in the
aggregate not less than 25% of the total number of the shares of
Series A Preferred Stock outstanding may request, the calling of
a special meeting of the holders of shares of Series A Preferred
Stock, which meeting shall thereupon be called by the Secretary
of the Corporation. Notice of such meeting and of any annual
meeting at which holders of shares of Series A Preferred Stock
are entitled to vote pursuant to this Section 3(C)(iii) shall be
given to each holder of record of shares of Series A Preferred
Stock by mailing a copy of such notice to such
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holder at such holder's last address as the same appears on the
books of the Corporation. Such meeting shall be called for a
time not earlier than 20 days and not later than 60 days after
such order or request or in default of the calling of such
meeting within 60 days after such order or request, such meeting
may be called on similar notice by any stockholder or
stockholders owning in the aggregate not less than 25% of the
total number of outstanding shares of Series A Preferred Stock.
Notwithstanding the provisions of this Section 3(C)(iii), no
such special meeting shall be called during the 60 days
immediately preceding the date fixed for the next annual meeting
of the stockholders.
(iv) During any default period, the holders of shares of
Common Stock and shares of Series A Preferred Stock, and other
classes or series of stock of the Corporation, if applicable,
shall continue to be entitled to elect all the Directors until
holders of the shares of Series A Preferred Stock shall have
exercised their right to elect two (2) Directors voting as a
separate class, after the exercise of which right (x) the
Directors so elected by the holders of shares of Series A
Preferred Stock shall continue in office until their successors
shall have been elected by such holders or until the expiration
of the default period, and (y) any vacancy in the Board of
Directors may (except as provided in Section 3(C)(ii)) be filled
by vote of a majority of the remaining Directors theretofore
elected by the holders of the class of capital stock which
elected the Director whose office shall have become vacant.
References in this Section 3(C) to Directors elected by the
holders of a particular class of capital stock shall include
Directors elected by such Directors to fill vacancies as
provided in clause (y) of the foregoing sentence.
(v) Immediately upon the expiration of a default period,
(x) the right of the holders of shares of Series A Preferred
Stock as a separate class to elect Directors shall cease, (y)
the term of any Directors elected by the holders of shares of
Series A Preferred Stock as a separate class shall terminate,
and (z) the number of Directors shall be such number as may be
provided for in the Certificate of Incorporation or by-laws
irrespective of any increase made pursuant to the provisions of
Section 3(C)(ii) (such number being subject, however, to change
thereafter in any manner provided by law or in the Certificate
of Incorporation or by-laws). Any vacancies in the Board of
Directors effected by the provisions of clauses (y) and (z) in
the preceding sentence may be filled by a majority of the
remaining Directors.
(vi) The provisions of this Section 3(C) shall govern
the election of Directors by holders of shares of Preferred
Stock during any default period notwithstanding any provisions
of the Certificate of Incorporation to the contrary, including,
without limitation, the provisions of Article Sixth of the
Certificate of Incorporation.
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(D) Except as set forth herein, or as otherwise provided by law,
holders of Series A Preferred Stock shall have no special voting rights
and their consent shall not be required (except to the extent they are
entitled to vote with holders of Common Stock as set forth herein) for
taking any corporate action.
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or
distributions payable on the Series A Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid
dividends and distributions, whether or not declared, on shares of
Series A Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
(i) declare or pay dividends, or make any other
distributions, on any shares of stock ranking junior (either as
to dividends or upon liquidation, dissolution or winding up) to
the Series A Preferred Stock;
(ii) declare or pay dividends, or make any other
distributions, on any shares of stock ranking on a parity
(either as to dividends or upon liquidation, dissolution or
winding up) with the Series A Preferred Stock, except dividends
paid ratably on the shares of Series A Preferred Stock and all
such parity stock on which dividends are payable or in arrears
in proportion to the total amounts to which the holders of all
such shares are then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking junior (either as to
dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock, provided that the Corporation may at
any time redeem, purchase or otherwise acquire shares of any
such junior stock in exchange for shares of any stock of the
Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A
Preferred Stock; or
(iv) redeem or purchase or otherwise acquire for
consideration any shares of Series A Preferred Stock, or any
shares of stock ranking on a parity with the Series A Preferred
Stock, except in accordance with a purchase offer made in
writing or by publication (as determined by the Board of
Directors) to all holders of such shares upon such terms as the
Board of Directors, after consideration of the respective annual
dividend rates and other relative rights and preferences of the
respective series and classes, shall determine in good faith
will result in fair and equitable treatment among the respective
series or classes.
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(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any
shares of stock of the Corporation unless the Corporation could, under
paragraph (A) of this Section 4, purchase or otherwise acquire such
shares at such time and in such manner.
Section 5. Reacquired Shares. Any shares of Series A Preferred
Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the acquisition
thereof. All such shares shall upon their cancellation become authorized but
unissued shares of Preferred Stock and may be reissued as part of a new series
of Preferred Stock subject to the conditions and restrictions on issuance set
forth herein, in the Certificate of Incorporation, or in any other Certificate
of Designations creating a series of Preferred Stock or any similar stock or as
otherwise required by law.
Section 6. Liquidation, Dissolution or Winding Up.
(A) Upon any liquidation, dissolution or winding up of the
Corporation, no distribution shall be made (1) to the holders of shares of stock
ranking junior (either as to dividends or upon liquidation, dissolution or
winding up) to the Series A Preferred Stock unless, prior thereto, the holders
of shares of Series A Preferred Stock shall have received One Thousand Dollars
($1,000), per share, plus an amount equal to accrued and unpaid dividends and
distributions thereon, whether or not declared, to the date of such payment;
provided, however, that the holders of shares of Series A Preferred Stock shall
be entitled to receive an aggregate amount per share, subject to the provision
for adjustment hereinafter set forth, equal to one thousand (1,000), times the
aggregate amount to be distributed per share to holders of shares of Common
Stock, or (2) to the holders of shares of stock ranking on a parity (either as
to dividends or upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except distributions made ratably on the Series A Preferred
Stock and all such parity stock in proportion to the total amounts to which the
holders of all such shares are entitled upon such liquidation, dissolution or
winding up. In the event the Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common Stock, then
in each such case the aggregate amount to which holders of shares of Series A
Preferred Stock were entitled immediately prior to such event under the proviso
in clause (1) of the preceding sentence shall be adjusted by multiplying such
amount by a fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately prior to
such event.
(B) In the event, however, that there are not sufficient assets
available to permit payment in full the Series A Liquidation Preference and the
liquidation preferences of all other series of Preferred Stock, if any, which
rank on a parity with the Series A Preferred Stock, then such remaining assets
shall be distributed ratably to the holders of such parity shares in proportion
to their respective liquidation preferences.
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Section 7. Consolidation, Merger, etc. In case the Corporation
shall enter into any consolidation, merger, combination or other transaction in
which the shares of Common Stock are exchanged for or changed into other stock
or securities, cash and/or any other property, then in any such case each share
of Series A Preferred Stock shall at the same time be similarly exchanged or
changed into an amount per share, subject to the provision for adjustment
hereinafter set forth, equal to One Thousand (1,000) times the aggregate amount
of stock, securities, cash and/or any other property (payable in kind), as the
case may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the Corporation shall at any time declare or pay any
dividend on the Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common Stock, then
in each such case the amount set forth in the preceding sentence with respect to
the exchange or change of shares of Series A Preferred Stock shall be adjusted
by multiplying such amount by a fraction, the numerator of which is the number
of shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 8. No Redemption. The shares of Series A Preferred Stock
shall not be redeemable.
Section 9. Rank. The Series A Preferred Stock shall rank, with
respect to the payment of dividends and the distribution of assets, junior to
all series of any other class of the Corporation's Preferred Stock.
Section 10. Amendment. The Certificate of Incorporation of the
Corporation shall not be amended in any manner which would materially alter or
change the powers, preferences or special rights of the Series A Preferred Stock
so as to affect them adversely without the affirmative vote of the holders of at
least a majority of the outstanding shares of Series A Preferred Stock, voting
together as a single class.
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IN WITNESS WHEREOF, this Certificate of Designation is executed
on behalf of the Corporation by its President and its corporate seal attested by
its Secretary this 16th day of June, 1997.
/s/ PETER CARTWRIGHT
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Name: Peter Cartwright
Title: Chairman, President and Chief Executive Officer
Attest:
/s/ ANN B. CURTIS
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Name: Ann B. Curtis
Title: Senior Vice President
and Corporate Secretary
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