ARTICLES OF INCORPORATION
OF
CT COMMUNICATIONS, INC.
The undersigned person does hereby organize a business corporation under
the laws of the State of North Carolina, as contained in Chapter 55 of the
General Statutes of North Carolina, entitled "North Carolina Business
Corporation Act" and the several amendments thereto, and to that end does
hereby set forth:
1. The name of the Corporation is "CT Communications, Inc.".
2. The aggregate number of shares which the Corporation shall have
authority to issue is Eighteen Million Nineteen Thousand (18,019,000) shares
of capital stock which shall be classified and bear designations as follows:
(a) Three Million (3,000,000) shares of common stock designated
Voting Common Stock.
(b) Fifteen Million (15,000,000) shares of common stock designated
as Class B Nonvoting Common Stock. These shares shall be in all
respects the same as the Voting Common Stock except that the share shall not
be entitled to vote.
(c) Two Thousand (2,000) shares of preferred stock designated as
Four and One-half Percent Preferred Stock.
(d) Seventeen Thousand (17,000) shares of preferred stock
designated as Five Percent Preferred Stock.
3. The holders of the Four and One-Half Percent Preferred Stock shall
be entitled to receive, when and as declared from the surplus or net profits
arising from the business of the Corporation, cumulative dividends at the
rate of four and one-half percent (4-1/2%) per annum, and no more, payable
either quarterly, semiannually or annually as determined by the Board of
Directors, before any dividends shall be paid to the common stock, which shall
be entitled to receive any and all sums which may be distributed as dividends
in excess of the said dividends on the Four and One-half Percent Preferred
Stock.
Upon any distribution of capital assets, this Preferred Stock shall be
entitled to receive the sum of one hundred dollars ($100) a share, together
with a sum equivalent to all unpaid dividends (if any) accumulated thereon,
before any distribution shall be made to the common stock, which shall be
entitled to receive all the remainder of any capital assets so distributed.
This Preferred Stock shall be subject to redemption, either in whole or
in part, at the option of the Corporation upon any dividend date at one
hundred dollars ($100) per share, plus any unpaid accumulated dividends to
date of redemption, upon the vote of not less than a majority in interest of
the outstanding Voting Common Stock. Notice of the intention of the
Corporation to redeem this Preferred Stock shall be mailed thirty days before
the date of redemption to each holder of record of Four and One-half Percent
Preferred Stock at his last known post office address, and dividends on such
shares of stock as shall have been so called for redemption shall not accrue
after the redemption date given in said notice.
This Preferred Stock shall not have any voting rights.
4. The holders of the Five Percent Preferred Stock shall be entitled to
receive thereon from the surplus or net profits arising from the business of
the Corporation a fixed cumulative dividend when and as declared by the Board
of Directors of five percent (5%) per annum, and no more, payable
semiannually on the first day of January and July of each year. Should the
surplus or net profits arising from the business of this Corporation prior to
any dividend date be insufficient to pay the dividend on this Five Percent
Preferred Stock, such dividend shall be payable from future profits, and no
dividend shall at any time be paid on the common stock until the full amount
of five percent (5%) per annum up to such time shall have been paid or set
apart.
In the event of dissolution or liquidation of this Corporation,
the holders of the Five Percent Preferred Stock shall be entitled to receive
the par value of their stock, together with accumulated dividends thereon to
the date of payment, before holders of the common stock shall be entitled
to receive anything thereon. Thereafter the Five Percent Preferred Stock
shall not been titled to share in the assets of the Corporation.
The Five Percent Preferred Stock may be called or redeemed in whole or in
part on any semi-annual dividend payment date, at the option of the Board of
Directors, at the price of One Hundred Dollars ($100) per share and all
unpaid dividends accrued on such share. Not less than thirty (30) days
prior notice to the holders of record of the Five Percent Preferred Stock
shall be given by mailing notice to the last known address of the holder
thereof or by giving such other notice as may be prescribed by the bylaws or
by resolution of the Board of Directors.
The Five Percent Preferred Stock shall not have any voting rights.
5. The address of the initial registered office of the Corporation is
68 Cabarrus Avenue, East, Concord, Cabarrus County, North Carolina 28026-0227
and the name of the initial registered agent at such address is
Michael R. Coltrane.
6. The name and address of the sole incorporator is:
Name Address
Michael R. Coltrane 68 Cabarrus Avenue, East
Concord, NC 28026-0227
7. The number of directors constituting the initial board of directors
shall be seven (7) and the names and addresses of the persons who are to
serve as directors until the first annual meeting of shareholders, or until
their successors are elected and qualified, are:
Name Address
Betty Gay C. Bivens 400 Avinger Lane
Cottage 424
Davidson, NC 28036
John R. Boger, Jr. P. 0. Box 810
Concord, NC 28026-0810
Lester D. Coltrane, III 151 Ingleside Drive
Concord, NC 28025
Michael R. Coltrane 68 Cabarrus Avenue, East
Concord, NC 28026-0227
Jerry H. McClellan 68 Cabarrus Avenue, East
Concord, NC 28026-0227
Mariam C. Schramm 400 Avinger Ln, Apt. 201
Davidson, NC 28036
Phil W. Widenhouse 215 Union St., South
Concord, NC 28025
8. The purposes for which the corporation is organized are:
(a) To transact, operate and carry on in all of its branches a
general telecommunication business in Cabarrus, Rowan, and Stanly
counties and elsewhere in North Carolina with exchanges at Concord,
Kannapolis, China Grove - Landis, Mt.Pleasant, Harrisburg, Albemarle,
Badin, Oakboro, and New London and at such other places in North
Carolina or outside of North Carolina as seem to be desirable, either
directly or through subsidiaries and affiliates; and
(b) To engage in any lawful act or activity for which corporations
may be organized under Chapter 55 of the General Statutes of North
Carolina, entitled "North Carolina Business Corporation Act".
9. The shareholders shall not be entitled to cumulate their votes for
directors of the Corporation.
10. (a) In addition to any affirmative vote required by law or these
Articles of Incorporation, any "Business Combination" (as defined below)
involving the Corporation or any subsidiary thereof and any "Interested
Shareholder" (as defined below) shall require the affirmative vote of the
holders of at least 80% of the voting power of the outstanding shares of
capital stock of the Corporation entitled to vote generally in the election
of directors (the "Voting Stock"), voting together as a single class, unless
the Business Combination is approved by a majority of (i) the directors who
are unaffiliated with the Interested Shareholder and who were directors
before the Interested Shareholder became an Interested Shareholder
("Disinterested Directors"), and (ii) any successor or successors to any of
the Disinterested Directors who are not affiliated with an Interested
Shareholder and who were recommended by a majority of the Disinterested
Directors then on the Board. The 80% affirmative vote set forth above
shall be required, notwithstanding the fact that no vote may be required,
or that a lesser percentage may be specified, by law or otherwise.
(i) For purposes of this Article 10, the term "Business
Combination" and "Business Combinations" includes the
following transactions: (A) a merger or consolidation of the
Corporation or any subsidiary thereof with an Interested
Shareholder or with any other corporation or entity which is, or
after such merger or consolidation would be, an Affiliate (as
defined below) of an Interested Shareholder; (B) any sale, lease,
exchange or other disposition of the Corporation or any subsidiary
thereof of 20% or more of the total assets of the Corporation
(with the total assets determined as of the most recently audited
financial statements of the Corporation) if an Interested
Shareholder (or an Affiliate thereof) is a party to the
transaction; (C) the issuance of stock or other securities of the
Corporation or any subsidiary thereof to an Interested
Shareholder (or an Affiliate thereof) in exchange for cash or
property (including stock or other securities) having an aggregate
fair market value equal to or greater than 20% of the total assets
of the Corporation (with the total assets determined as of the most
recently audited financial statements of the Corporation); (D) the
adoption of any plan or proposal for the liquidation or
dissolution of the Corporation proposed by or on behalf of an
Interested Shareholder (or an Affiliate thereof); or (E) any
reclassification of securities (including any reverse
stock split), recapitalization, merger with a subsidiary or other
transaction which has the effect, directly or indirectly, of
increasing the proportionate share of the outstanding stock (or
securities convertible into stock) of any class of the
Corporation or any subsidiary thereof owned by an Interested
Shareholder.
(ii) For purposes of this Article 10, the term "Interested
Shareholder" shall mean any person (other than the Corporation or
any subsidiary thereof) who or which (A) is the beneficial owner,
directly or indirectly, of 20% or more of the voting power of the
outstanding Voting Stock; (B) is an Affiliate of the Corporation
and at any time within the two-year period immediately prior to
the date of any proposed Business Combination, was the beneficial
owner, directly or indirectly, of 20% or more of the voting power
of the then Voting Stock; or (C) is an assignee or has otherwise
succeeded to any shares of Voting Stock in a transaction not
involving a public offering which were at any time within the
two-year period prior to the date of any proposed Business
Combination beneficially owned by an Interested Shareholder.
(iii) For purposes of this Article 10, a person shall be
a "beneficial owner" of any Voting Stock: (A) if such person or
any of its Affiliates or Associates (as herein defined)
beneficially owns, directly or indirectly; or (B) if such person
or any of its Affiliates or Associates has (1) the right to acquire
(whether such right is exercisable immediately or only after the
passage of time) pursuant to any agreement, arrangement or
understanding or upon the exercise of conversion rights, exchange
rights, warrants, options or otherwise or (2) the right to vote
pursuant to any agreement, arrangement or understanding; or (C)
which are beneficially owned, directly or indirectly, by any other
person with which such person or any of its Affiliates or
Associates has any agreement, arrangement or understanding for the
purpose of acquiring, holding, voting or disposing of any shares
of Voting Stock.
(iv) For purposes of this Article 10, the terms "Affiliate"
or "Associate" shall have the respective meanings ascribed to such
terms in Rule 12b-2 of the General Rules and Regulations under the
Securities Exchange Act of 1934, as amended.
(b) The majority of directors of the Corporation shall have the
power and duty, among other things, to determine for purposes of this
Article 10 on the basis of information known to them after reasonable
inquiry, (i) whether a person is an Interested Shareholder, (ii) the
number of shares of Voting Stock beneficially owned by any person,
(iii) whether a person is an Affiliate or Associate of another, and
(iv) whether the assets which are the subject of any Business
Combination have, or the consideration to be received for the issuance
or transfer of securities by the Corporation or any subsidiary in any
Business Combination has, an aggregate fair market value equal to or
in excess of 20% of the total assets of the Corporation, with the total
assets determined as of the most recently audited financial statements
of the Corporation.
(c) Nothing contained in this Article 10 shall be construed to
relieve any Interested Shareholder from any fiduciary obligation
imposed by law.
(d) Notwithstanding any other provision of these Articles of
Incorporation or the Bylaws of the Corporation (and notwithstanding
that a lesser percentage may be specified by law, these Articles of
Incorporation or the Bylaws of the Corporation), the affirmative vote
of the holders of 80% or more of the outstanding Voting Stock, voting
together as a single class, shall be required to amend or repeal, or
adopt any provision inconsistent with, this Article 10.
11. As soon as permissible by North Carolina Statutes, the Directors
shall be divided into three classes, as nearly equal in number as may be,
the term of office of those of the first class to expire at the first Annual
Meeting of Shareholders after their election, the term of office
of those of the second class to expire at the second Annual Meeting of
Shareholders after their election, and the term of office of those of the
third class to expire at the third Annual Meeting of Shareholders after
their election. At each annual election held thereafter, directors shall be
chosen for a term of three years to succeed those whose terms expire.
12. In considering or acting on an offer or proposal that relates to the
sale of all of substantially all of the assets of this Corporation, whether
or not in the usual and regular course of the business of this Corporation,
or an offer or proposal that relates to the sale of all or substantially all
of the stock of this Corporation or a sufficient amount of the voting stock
to effect the control of the Corporation, a director of this Corporation
shall consider, in determining what he or she reasonably believes to be in
the best interest of the Corporation and its subsidiaries, considered as one
enterprise, (1) the long- term, as well as the short-term, interests of the
Corporation and its subsidiaries, (2) the interests of the shareholders of the
Corporation and its subsidiaries, long-term as well as short-term, including
the possibility that those interests may be best served by the continued
independence of the Corporation and its subsidiaries, (3) the interests of
the employees, customers, creditors and suppliers of the Corporation and its
subsidiaries, and (4) community and societal considerations including those
of any community in which any office or other facility of the Corporation
and its subsidiaries is located. A Director may also in his or her
discretion consider any other factors he or she believes to be in the best
interests of the Corporation and its subsidiaries. A person who performs
his or her duties in accordance with this Article shall be deemed to have no
liability by reason of being or having been a Director of the Corporation.
13. To the fullest extent permitted by the North Carolina Business
Corporation Act, as the same exists or may hereafter be amended, a director
of the Corporation shall not be personally liable to the Corporation, its
shareholders or otherwise, for monetary damages for breach of duty as a
director. Any repeal or modification of this Article shall be prospective
only and shall not adversely affect any limitation on the personal liability
of a director of the Corporation existing at the time of such repeal or
modification.
14. A director of the Corporation may be removed only for cause by a
vote of the shareholders of the Corporation if the number of votes cast to
remove such director exceeds the number of votes cast not to remove him or
her. If a director is elected by a voting group of shareholders, only the
shareholders of that voting group may participate in the vote to remove
such director. A director may not be removed by the shareholders at a meeting
unless the notice of the meeting states that the purpose, or one of the
purposes, of the meeting is removal for cause of the director. If any
directors are so removed, new directors may be elected at the same
meeting.
15. The provisions of the North Carolina Shareholder Protection Act
entitled "Shareholder Protection Act" of the North Carolina Business
Corporation Act shall not be applicable to this Corporation.
16. The provisions of the North Carolina Control Share Acquisition Act
entitled "Control Share Acquisitions" of the North Carolina Business
Corporation Act shall not be applicable to this Corporation.
17. These Articles will become effective when filed.
IN WITNESS WHEREOF, the incorporator has executed these Articles of
Incorporation, this the ____ day of July, 1993.
__________________________
Michael R. Coltrane,
Incorporator