EXHIBIT B
FORM OF CERTIFICATE OF AMENDMENT TO THE
THIRD RESTATED AND AMENDED
ARTICLES OF INCORPORATION
OF
PIONEER HI-BRED INTERNATIONAL, INC.
I.
The Corporation's Third Restated and Amended Articles of
Incorporation is hereby amended by deleting clause (ii) of paragraph A
of Article IV in its entirety and inserting the following so that
clauses (ii) and (iii) of paragraph A of Article IV shall hereafter
read as follows:
"(ii) 600,000 shares of Class B Common Stock without par
value, and (iii) 10,000,000 shares, consisting of one class designated
as serial preferred without par value."
II.
The Corporation's Third Restated and Amended Articles of
Incorporation is hereby amended by inserting a new paragraph D and
renaming the old paragraph D as paragraph F so that paragraphs D and F
of Article IV shall hereafter read as follows:
"D. 1. Designation; Class and Amount; Certain Definitions. The
series of Class B Common Stock, the issuance of which is hereby
authorized, shall comprise of 600,000 shares the distinctive serial
designation of which shall be "Class B Common Stock." Each share of
Class B Common Stock shall be identical in all respects with all other
shares of Class B Common Stock. The number of shares of Class B
Common Stock which are purchased or otherwise acquired by the
Corporation or converted into Common Stock shall be canceled and shall
revert to authorized but unissued shares of Class B Common Stock. The
Corporation shall not issue, sell or otherwise transfer shares of
Class B Common Stock to any Person other than the members of the
Investor Group. Certain capitalized terms used herein have the
meanings specified therefor in Section 9 below.
2. Dividends. (a) Except as set forth in the Investment
Agreement, each Holder of shares of Class B Common Stock shall
participate with the holders of Common Stock in all Dividends (other
than Dividends in respect of which an adjustment is made in the number
of shares of Common Stock issuable upon conversion as prescribed in
Section 6(c)(i) below), when, as and if declared by the Board and paid
or distributed by the Corporation on or in respect of the Common Stock
on a share for share basis and in like tenor and forms as the Dividend
paid on the Common Stock as if all shares of Class B Common Stock were
converted into the number of shares of Common Stock (whether or not
the Class B Common Stock is then so convertible) calculated in
accordance with Section 6 below, immediately prior to the record date
for such Dividend. Except as set forth above, holders of shares of
Class B Common Stock shall not be entitled to receive any dividends.
Except to the extent payable in respect of dividends paid on the
Common Stock, no interest, or sum of money in lieu of interest, shall
be payable in respect of any dividend payment or payments on shares of
Class B Common Stock.
(b) Dividends on the Class B Common Stock in respect of
each Dividend shall be payable, when and if declared by the Board of
Directors, concurrently with each date of payment (each such date, a
"Dividend Payment Date") by the Corporation of Dividends on the Common
Stock. Dividends payable in cash shall be paid by wire transfer in
immediately available funds to the accounts designated by the
respective Holders in written notices given to the Corporation at
least two Business Days prior to the payment date or by such other
means as may be agreed to by the Corporation and the respective
Holders.
(c) The Corporation will cause written notice of each
Dividend on the Class B Common Stock to be given to each Holder within
five Business Days after it is determined by the Board of Directors.
3. Voting Rights. (a) Except as otherwise provided herein,
or expressly provided in the Investement Agreement or as required by
law, the Holders of Class B Common Stock shall not be entitled to any
Vote.
(b) At any meeting called for the purpose of voting on
(or acting by written consent with respect to) any matter to be voted
upon by the holders of Common Stock of the Corporation, the holders of
shares of Class B Common Stock and the holders of shares of Common
Stock shall vote together as one class on all matters so submitted to
a vote of stockholders of the Corporation. At any such meeting or in
connection with any such action by written consent, each share of
Class B Common Stock shall carry, as of the record date applicable to
such vote, a number of votes equal to the Per Share Vote Amount as
calculated by the Corporation for such meeting.
(c) In accordance with Section 6.2(b) of the Investment
Agreement, the Corporation will cause written notice of any vote as to
which holders of Common Stock are entitled to vote as a separate class
or voting group under the Articles of Incorporation or Iowa Law (a
"Class Vote"), to be given to each Holder at least 15 Business Days
prior to such Class Vote.
4. Liquidation Preference. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the affairs of
the Corporation, the Holders of shares of Class B Common Stock then
outstanding shall be entitled, for each share of Class B Common Stock,
to be paid out of the assets of the Corporation available for
distribution to its stockholders the amount of cash or other property
that would be payable on the number of shares of Common Stock then
issuable upon conversion of such share of Class B Common Stock
(whether or not then convertible) (such amount payable being adjusted
appropriately to reflect any stock split, stock dividend, reverse
stock split, or any transaction with comparable effect upon the Common
Stock) (the "Liquidation Preference"). This entitlement of the Holders
of shares of Class B Common Stock, to the extent equal to $.01 for
each share of Class B Common Stock, shall be satisfied before any
similar payment shall be made or any assets distributed to the holders
of the Common Stock or any other security junior in rank to the Class
B Common Stock as to distribution of assets upon such dissolution,
liquidation or winding up and otherwise shall be satisfied on a pari
passu basis with the holders of the Common Stock. If the assets of the
Corporation are not sufficient to pay in full the liquidation payments
payable to all of the Holders of the outstanding shares of Class B
Common Stock, then the Holders of all such shares shall share ratably
in such distribution of assets in accordance with the liquidation
preference to which they are entitled. For the purposes of this
section, neither the voluntary sale, conveyance, exchange or transfer
(for cash, shares of stock, securities or other consideration) of all
or substantially all of the property or assets of the Corporation nor
the consolidation or merger of the Corporation with one or more other
corporations shall be deemed to be a liquidation, dissolution or
winding up, voluntary or involuntary, unless such voluntary sale,
conveyance, exchange or transfer shall be in connection with a
dissolution or winding up of the business of the Corporation.
5. Restrictions on Transfer. The shares of Class B Common
Stock are subject to the provisions of the Investment Agreement
(including the provisions thereof restricting transfer of such stock).
6. Conversion. (a) (i) Concurrently with the transfer of
Beneficial Ownership of any share of Class B Common Stock to any
Person other than the Investor or another member of the Investor Group
or Other Investor Affiliate, such share of Class B Common Stock shall
convert into 100 fully-paid and non-assessable shares of Common Stock
(as adjusted pursuant to Section 6(c)), in accordance with the
procedures provided in clause (b) of this Section 6.
(ii) At any time (x) at the direction of the
Corporation, but only if the Corporation intends to recommend approval
of a Voting Amendment (as defined in the Investment Agreement), and
(y) at the direction of the Investor, following the approval and
effectiveness of a Voting Amendment, shares of Class B Common Stock
shall be mandatorily convertible into fully-paid and non-assessable
shares of Common Stock, with each share of Class B Common Stock being
converted into 100 shares of Common Stock (as adjusted pursuant to
Section 6(c)).
(iii) At any time that all outstanding shares
of Common Stock (or whatever security received upon conversion or
exchange thereof) have the same vote per share, if any, without any
time phase voting, all shares of Class B Common Stock shall be
convertible into fully-paid and non-assessable shares of Common Stock,
with each such share of Class B Common Stock being converted into 100
shares of Common Stock (as adjusted pursuant to Section 6(c)).
(iv) Except as set forth in this Section 6(a),
the shares of Class B Common Stock are not convertible at the option
of the Holder thereof.
(b) (i) Any Holder of shares of Class B Common
Stock required (or in the case of clause (iii) above requesting) to
convert any or all such shares into Common Stock shall surrender the
certificate(s) evidencing such shares of Class B Common Stock of the
Holder at the office of the transfer agent appointed for the purpose
of such conversion by the Corporation. Such surrendered
certificate(s), if the Corporation shall so require, shall be duly
endorsed to the Corporation or in blank, or accompanied by proper
instruments of transfer to the Corporation or in blank.
(ii) The Corporation shall, within one Business
Day after such surrender of certificates evidencing shares of Class B
Common Stock accompanied by written notice and in compliance with any
other conditions contained herein, issue and deliver, or cause to be
issued and delivered, to the Person(s) for whose account such
certificate(s) evidencing shares of Class B Common Stock were so
surrendered, or to the nominee(s) of such Person(s), certificates
representing the number of full shares of Common Stock to which such
Person shall be entitled pursuant to the then-applicable conversion
rate. Such conversion shall be deemed to have been made on the date of
such surrender of the certificate(s) evidencing shares of Class B
Common Stock to be converted (the "Surrender Date") and the Person(s)
entitled to receive the Common Stock deliverable upon conversion of
such Class B Common Stock shall be treated for all purposes as the
record holder(s) of such Common Stock on such date and thereafter.
Conversion of Class B Common Stock may otherwise be achieved in
accordance with such procedures as the Corporation and a majority of
the Holders may agree.
(iii) In the event that fewer than all shares of
Class B Common Stock represented by a surrendered certificate are to
be converted hereunder, a new certificate shall be issued at the
Corporation's expense representing the shares of Class B Common Stock
not so converted.
(iv) In connection with the conversion of any
shares of Class B Common Stock, no fractions of shares of Common Stock
shall be issued, but in lieu thereof the Corporation shall pay a cash
adjustment in respect of such fractional interest in an amount equal
to such fractional interest multiplied by the Market Price (as defined
in the Investment Agreement) per share of Common Stock on the day on
which such shares of Class B Common Stock are deemed to have been
converted.
(c) The conversion rate shall be adjusted from time to
time as follows:
(i) In case the Corporation shall, at any time
or from time to time while any of the shares of Class B Common Stock
are outstanding, (A) subdivide or reclassify its outstanding shares of
Common Stock into a larger number of shares (including a subdivision
effected by declaring and paying a Dividend payable in additional
shares of Common Stock), or (B) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the conversion
rate in effect immediately prior to such action shall be adjusted so
that the Holder of any shares of Class B Common Stock thereafter
surrendered for conversion shall be entitled to receive the number of
shares of Common Stock which such Holder would have owned or have been
entitled to receive immediately following such action had such shares
of Class B Common Stock been converted immediately prior thereto
(which adjustments shall be in lieu of payment of any Dividend on the
Class B Common Stock). An adjustment made pursuant to this Section
6(c)(i) shall become effective immediately after the close of business
on the effective date of a subdivision, reclassification or
combination. If, as a result of an adjustment made pursuant to this
Section 6(c)(i), the Holder of any shares of Class B Common Stock
thereafter surrendered for conversion shall become entitled to receive
shares of two or more classes of capital stock of the Corporation, the
Board of Directors shall make an appropriate allocation of the
adjusted conversion rate between or among shares of such classes of
capital stock in accordance with the entitlements of the Common Stock
underlying the Class B Common Stock in connection with such
adjustment.
(ii) Whenever an adjustment in the conversion
rate is required, the Corporation shall forthwith place on file with
its Transfer Agent a statement signed by its Chief Executive Officer,
Chief Financial Officer or a Vice President and by its Secretary,
Assistant Secretary, Treasurer or Assistant Treasurer, stating the
adjusted conversion rate determined as provided herein. Such
statements shall set forth in reasonable detail such facts as shall be
necessary to show the reason and the manner of computing such
adjustment.
(iii) In the event that prior to the issuance of
the Class B Common Stock the Company shall (A) subdivide or reclassify
its outstanding shares of Common Stock into a larger number of shares
(including a subdivision effected by declaring or paying a Dividend
payable in additional shares of Common Stock) or (B) combine or
reclassify its outstanding shares of Common Stock into a smaller
number of shares, the conversion ratio applicable to the Class B
Common Stock shall be appropriately adjusted.
(d) (i) The Corporation shall at all times reserve
and keep available, free from preemptive rights, out of its authorized
and unissued stock, such number of shares of its Common Stock as shall
from time to time be sufficient to effect the conversion of all shares
of Class B Common Stock from time to time outstanding, solely for the
purpose of effecting such conversion. The Corporation shall, from time
to time, in accordance with the laws of the State of Iowa, increase
the authorized number of shares of Common Stock if at any time the
number of shares of authorized and unissued Common Stock shall not be
sufficient to permit the conversion of all the then outstanding shares
of Class B Common Stock.
(ii) The Corporation will pay any and all stamp
and transfer taxes that may be payable in respect of the issuance or
delivery of shares of Common Stock upon conversion of shares of Class
B Common Stock pursuant hereto. The Corporation shall not, however, be
required to pay any tax which may be payable in respect of any
transfer involved in the issuance and delivery of shares of Common
Stock in a name other than that in which the shares of Class B Common
Stock so converted were registered and no such issuance or delivery
shall be made unless and until the person requesting such issuance has
paid to the Corporation the amount of any such tax or has established
to the satisfaction of the Corporation that such tax has been paid.
(e) In case of (i) any reclassification or change of
outstanding shares of Common Stock (other than a change in par value
or from par value to no par value or from no par value to par value,
or as a result of a subdivision or combination) or (ii) any
consolidation or merger of the Corporation with one or more other
corporations (other than a consolidation or merger in which the
Corporation is the continuing corporation and which does not result in
any reclassification or change of outstanding shares of Common Stock
issuable upon conversion of Class B Common Stock) or (iii) any sale or
conveyance to another corporation or other entity of all or
substantially all of the property of the Corporation, then the
Corporation, or such successor corporation or other entity, as the
case may be, shall make appropriate provision so that the holder of
each share of Class B Common Stock then outstanding shall have the
right to convert such share into the kind and amount of shares of
stock or other securities and property receivable upon such
consolidation, merger, sale, reclassification, change or conveyance by
a holder of the number of shares of Common Stock into which such
shares of Class B Common Stock might have been converted immediately
prior to such consolidation, merger, sale, reclassification, change or
conveyance, subject to adjustment which shall be as nearly equivalent
as may be practicable to the adjustments provided for in Section 6(c).
If the holders of Common Stock are entitled to elect the consideration
payable pursuant to any consolidation, merger, sale, conveyance or other
transaction or event set forth above, the Holders also shall be
entitled to elect between such forms of consideration. The provisions
of this paragraph shall apply similarly to successive consolidations,
mergers, sales, conveyances or other transactions or events.
(f) Whenever the number of shares of Common Stock into
which each share of Class B Common Stock is convertible is adjusted as
provided in this Section 6, the Corporation shall promptly mail to the
Holders a notice in accordance with Section 8 below stating that the
number of shares of Common Stock into which the shares of Class B
Common Stock are convertible has been adjusted and setting forth the
new number of shares of Common Stock (or describing the new stock,
securities, cash or other property) into which each share of Class B
Common Stock is convertible, as a result of such adjustment, a brief
statement of the facts requiring such adjustment and the computation
thereof, and when such adjustment became effective.
7. Limited Priority. The Class B Common Stock shall, to the
extent of the Liquidation Preference set forth in Section 4, be senior
in rank as to distribution of assets upon any liquidation, dissolution
or winding up of the affairs of the Corporation, to the Common Stock,
or any class of equity securities of the Corporation which by its
terms are junior to the Class B Common Stock, unless the Holders of
66 2/3 percent of the outstanding shares of the Class B Common Stock
shall otherwise consent.
8. Notices. The Corporation shall provide notice to each
Holder of any action taken or proposed to be taken or any
determination made by the Corporation and/or the Holder under the
terms of this Third Restated and Amended Articles of Incorporation.
Notice of any such action or determination by the Corporation and/or
the Holder and all other notices and other communications provided for
in this Third Restated and Amended Articles of Incorporation shall be
delivered by facsimile and by reputable overnight courier,
(a) If to the Company, to:
Pioneer Hi-Bred International, Inc.
800 Capital Square
Des Moines, Iowa 50309
Attention: General Counsel
Telephone: 515-248-4800
Facsimile: 515-248-4844
with a copy to:
Fried, Frank, Harris, Shriver & Jacobson
One New York Plaza
New York, New York 10004
Facsimile: (212) 859-4000
Attn.: Stephen Fraidin
or such other address as the Corporation shall have
furnished to the Holders in writing,
(b) if to a Holder, to the address and facsimile number of
such Holder listed on the Stock Books of the Corporation.
9. Definitions. Certain capitalized terms are used herein as
defined below:
"Affiliate" of a Person has the meaning set forth in Rule
12b-2 under the Exchange Act.
"Articles of Incorporation" means the Third Restated and
Amended Articles of Incorporation of the Corporation, as amended from
time to time.
"Beneficially Owned" with respect to any securities means
having "beneficial ownership" of such securities (as determined
pursuant to Rule 13d-3 under the Exchange Act, as in effect on the
date hereof, without limitation by the 60-day provision in paragraph
(d)(1)(i) thereof). The terms "Beneficial Ownership" and "Beneficial
Owner" have correlative meanings.
"Board" means the Board of Directors of the Corporation.
"Business Day" means any day other than a Saturday, Sunday,
or a day on which banking institutions in the State of Iowa are
authorized or obligated by law or executive order to close.
"Class B Common Stock" has the meaning specified in Section 1
above.
"Common Stock" means the Common Stock, par value $1.00 per
share, of the Corporation.
"Common Voting Power" means, in respect of any record date
for any meeting of stockholders (or action by written consent in lieu
of a meeting) the aggregate Votes represented by all then outstanding
Voting Securities other than the Class B Common Stock as determined by
the Board in accordance with the procedures set forth in the Articles
of Incorporation based on the actual Votes entitled to be voted at
such meeting (excluding any estimation of any kind, including as to
who would have been entitled to 5 Votes per share if such shareholders
had taken the requisite steps to obtain such Vote).
"Dividend" means any dividend or distribution on or in
respect of the Common Stock of the Corporation, whether in cash,
additional shares of Common Stock or other property.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the regulations promulgated thereunder.
"Holder" means a holder of record of a share or shares of
Class B Common Stock.
"Investment Agreement" means the Agreement, dated as of
August 6, 1997, between the Investor and the Corporation, as amended
and/or restated from time to time.
"Investor" means E.I. du Pont de Nemours and Company.
"Investor Group" shall have the meaning set forth in the
Investment Agreement.
"Investor Group Total Ownership Percentage" means, with
respect to the Investor Group calculated at a particular point in
time, the ratio, expressed as a percentage, of (a) the total number of
shares of Common Stock Beneficially Owned by the Investor Group and
issuable upon conversion of (whether or not then convertible), or
otherwise constituting the economic equivalent of, all Common
Securities (as defined in the Investment Agreement) Beneficially Owned
by the Investor Group, over (b) the total number of shares of Common
Stock then outstanding and the number of shares of Common Stock
issuable upon conversion (whether or not then convertible) of, or
otherwise constituting the economic equivalent of, all outstanding
Common Securities; provided that in no event shall the Investor Group
Total Ownership Percentage of all Holders of Class B Common Stock be
greater than 20%.
"Iowa Law" shall mean the Business Corporation Act of the
State of Iowa.
"Liquidation Preference" has the meaning specified in Section
4 above.
"Other Investor Affiliate" shall have the meaning set forth
in the Investment Agreement.
"Per Share Vote Amount" means in respect of any record date
for any meeting of stockholders (or action by written consent in lieu
of a meeting) that number of Votes per share of Class B Common Stock
equal to (x) the Total Preferred Vote Amount as of such record date
amount divided by (y) the number of shares of Class B Common Stock
outstanding as of such record date.
"Person" means any individual, corporation, company,
association, partnership, joint venture, limited liability company,
trust or unincorporated organization, group (within the meaning of
Rule 13d-5 under the Exchange Act) or a government or any agency or
political subdivision thereof.
"Stock Books" means the stock transfer books of the
Corporation relating to its Common Stock and Preferred Stock.
"Subsidiary" means, as to any Person, any other Person more
than fifty percent (50%) of the shares of the voting stock or other
voting interests of which are owned or controlled, or the ability to
select or elect more than fifty percent (50%) of the directors or
similar managers is held, directly or indirectly, by such first Person
or one or more of its Subsidiaries or by such first Person and one or
more of its Subsidiaries. A Subsidiary that is directly or indirectly
wholly-owned by another Person except for directors' qualifying shares
shall be deemed wholly-owned for purposes of this Agreement.
"Surrender Date" has the meaning specified in Section 6
above.
"13D Group" shall mean any group of Persons who, with respect
to those acquiring, holding, voting or disposing of Voting Securities
would, assuming ownership of the requisite percentage thereof, be
required under Section 13(d) of the Exchange Act and the rules and
regulations thereunder to file a statement on Schedule 13D with the
Securities and Exchange Commission as a "person" within the meaning of
Section 13(d)(3) of the Exchange Act, or who would be considered a
"person" for purposes of Section 13(g)(3) of the Exchange Act.
"Total Preferred Vote Amount" means, in respect of the record
date for any meeting (or action by written consent in lieu of a
meeting) of shareholders of the Corporation to vote on any matter, an
aggregate number of Votes equal to (a) the Common Voting Power as of
such record date multiplied by (b) a fraction, the numerator of which
is the Investor Group Total Ownership Percentage (expressed as a
fraction carried to two decimal places) as of such record date and the
denominator of which is 1.00 minus the Investor Group Total Ownership
Percentage (expressed as a fraction carried to two decimal places) as
of such record date; provided that in no event shall the Total
Preferred Vote Amount be greater than 20% of Total Voting Power.
"Total Voting Power" means in respect of any record date for
any meeting of stockholders (or action by written consent in lieu of a
meeting) the aggregate Votes represented by all then outstanding
Voting Securities as determined by the Board in accordance with the
procedures set forth in the Articles of Incorporation based on the
actual Votes entitled to be voted at such meeting (excluding any
estimation of any kind, including as to who would have been entitled
to 5 Votes per share if such shareholders had taken the requisite
steps to obtain such Vote).
"Votes" shall mean, at any time, with respect to any Voting
Securities, the total number of votes that would be entitled to be
cast by the holders of such Voting Securities generally (by the terms
of such Voting Securities, the Articles of Incorporation or any
certificate of designations for such Voting Securities) in a meeting
for the election of directors held at such time, including the votes
that would be able to be cast by holders of shares of Class B Common
Stock in accordance with the procedures set forth in the Articles of
Incorporation based on the actual number of Votes entitled to be voted
at such meeting (excluding any estimation of any kind, including as to
who would have been entitled to 5 Votes per share if such shareholders
had taken the requisite steps to obtain such Vote).
"Voting Securities" means the shares of Common Stock, the
Class B Common Stock and any other securities of the Corporation
entitled to vote generally for the election of directors, and any
securities (other than employee stock options) which are convertible
into, or exercisable or exchangeable for, Voting Securities.
F. The holder of any shares of such Common Stock, Class B Common
Stock or Serial Preferred Stock shall have no preemptive rights to
acquire any additional shares of the Corporation or to acquire any
treasury stock of the Corporation."
III.
Upon the filing in the Office of the Secretary of State of the
State of Iowa of this Certificate of Amendment, (i) each of the
outstanding 164,445.86 shares of Series A Convertible Preferred Stock
of the Corporation issued and outstanding immediately prior to such
filing of this Certificate of Amendment shall be automatically
reclassified and changed without any further action on the part of the
Corporation or shareholders of the Corporation into one fully paid and
nonassessable share of Class B Common Stock, and (ii) each of the
200,000 authorized shares of Series A Convertible Preferred Stock will
revert to serial preferred without designation and the Certificate of
Designation of Series A Convertible Preferred Stock will cease to be
in force and effect.