EXHIBIT 3.1
ARTICLES OF INCORPORATION
OF
ST. JUDE MEDICAL, INC.
ARTICLE I.
Name
----
The name of the corporation shall be St. Jude Medical, Inc.
ARTICLE II.
Business Purposes
-----------------
The purposes for which this corporation is organized are as follows:
a. General business purposes.
b. To do everything necessary, proper, advisable or convenient
for the accomplishment of the purposes hereinabove set forth,
and to do all other things incidental thereto or connected
therewith, which are not forbidden by the laws under which
this corporation is organized, by other laws, or by these
Articles of Incorporation.
c. To carry out the purposes hereinabove set forth in any state,
territory, district or possession of the United States, or in
any foreign country, to the extent that such purposes are not
forbidden by law, to limit in any certificate for application
to do business, the purposes or purpose which the corporation
proposes to carry on therein to such extent as are not
forbidden by law thereof.
ARTICLE III.
Duration
--------
The duration of the corporation shall be perpetual.
1
(2005 Restatement)
ARTICLE IV.
Registered Office
-----------------
The location and post office address of the registered office of the
corporation in the State of Minnesota is One Lillehei Plaza, St. Paul, Minnesota
55117.
ARTICLE V.
Powers of the Corporation
-------------------------
This corporation shall have all the powers granted to private
corporations organized for profit by said Minnesota Business Corporation Act,
and in furtherance and not in limitation of the powers conferred by the laws of
the State of Minnesota upon corporations organized for the foregoing purposes,
the corporation shall have the power:
a. To acquire, hold, mortgage, pledge or dispose of the shares,
bonds, securities or other evidences of indebtedness of the
United States of America, or of any domestic or foreign
corporation, and while the holder of such shares to exercise
all the privileges of ownership, including the right to vote
thereof, to the same extent as a natural person might or could
do, by the president of this corporation or by proxy appointed
by him, unless some other person, by resolution of the Board
of Directors, shall be appointed to vote such shares.
b. To purchase or otherwise acquire on such terms and in such
manner as the Bylaws of this corporation from time to time
provide, and to own all shares of the capital stock of this
corporation, and to reissue the same from time to time.
c. When and as authorized by the vote of the holders of not less
than a majority of the shares entitled to vote, at a
shareholders' meeting called for that purpose, or when
authorized upon the written consent of the holders of a
majority of such shares, to sell, lease, exchange or otherwise
dispose of all, or substantially all, of its property and
assets, including its goodwill, upon such terms and for such
consideration which may be money, shares, bonds or other
instruments for the payment of money or other property as the
Board of Directors deems expedient or advisable.
d. To acquire, hold, lease, encumber, convey or otherwise dispose
of, either alone or in conjunction with others, real and
personal property within or without the state; and to take
real and personal property by will or gift.
e. To acquire, hold, take over as a going concern and thereafter
to carry on, mortgage, sell or otherwise dispose of, either
alone or in conjunction with
2
(2005 Restatement)
others, the rights, property and business of any person,
entity, partnership, association or corporation heretofore or
hereafter engaged in any business, the purpose of which is
similar to the purposes set forth in Article II of these
Articles of Incorporation.
f. To enter into any lawful arrangement for sharing profits,
union of interests, reciprocal association or cooperative
association with any corporation, association, partnership,
individual or other legal entity, for the carrying on of any
business, the purpose of which is similar to the purposes set
forth in Article II of these Articles of Incorporation.
ARTICLE VI.
Mergers and Consolidation
-------------------------
Any agreement for consolidation or merger with one or more foreign or
domestic corporations may be authorized by vote of the holders of a majority of
the shares entitled to vote.
ARTICLE VII.
Capital Stock
-------------
The authorized capital stock of this corporation shall be Five Hundred
Million (500,000,000) shares of common stock of the par value of Ten Cents
($.10) per share (the "Common Stock") and Twenty-Five Million (25,000,000)
shares of preferred stock of the par value of One Dollar ($1.00) per share (the
"Preferred Stock").
SECTION 1. General.
(a) No holder of capital stock in the corporation shall be
entitled to any cumulative voting rights.
(b) No holder of capital stock of the corporation shall have
any preferential, preemptive or other rights of subscription to any
shares of any class of capital stock of the corporation allotted or
sold or to be allotted or sold now or hereafter authorized, or to any
obligations convertible into the capital stock of the corporation of
any class, or any right of subscription to any part thereof.
SECTION 2. Common Stock. Subject to all of the rights of the Preferred
Stock, and except as may be expressly provided with respect to the Preferred
Stock herein, by law or by the Board of Directors pursuant to this Article VII:
3
(2005 Restatement)
(a) The holders of the Common Stock shall be entitled to
receive when and as declared by the Board of Directors, out of earnings
or surplus legally available therefore, dividends, payable either in
cash, in property, or in shares of the capital stock of the
corporation.
(b) The Common Stock may be allotted for such consideration
and as and when the Board of Directors shall determine, and, under and
pursuant to the laws of the State of Minnesota, the Board of Directors
shall have the power to fix or alter, from time to time, in respect to
shares then unallotted, any or all of the following: the dividend rate,
the redemption price, the liquidation price, the conversion rights and
the sinking or purchase fund rights of shares of any class, or of any
series of any class, or the number of shares constituting any series of
any class. The Board of Directors shall also have the power to fix the
terms, provisions and conditions of options to purchase or subscribe
for shares of any class or classes, including the price and conversion
basis thereof. The Board of Directors shall also have the power to
issue shares of stock of the corporation or assets of other business
enterprises, as it may from time to time deem expedient.
SECTION 3. Preferred Stock. The Preferred Stock may be issued from time
to time by the Board of Directors as shares of one or more series. Subject to
the provisions hereof and the limitations prescribed by law, the Board of
Directors is expressly authorized by adopting resolutions providing for the
issuance of shares of any particular series and, if and to the extent from time
to time required by law, by filing with the Minnesota Secretary of State a
statement with respect to the adoption of the resolutions pursuant to the
Minnesota Business Corporation Act (or other law hereafter in effect relating to
the same or substantially similar subject matter), to establish the number of
shares to be included in each such series and to fix the designation and
relative powers, preferences and rights and the qualifications and limitations
or restrictions thereof relating to the shares of each such series. The
authority of the Board of Directors with respect to each series shall include,
but not be limited to, determination of the following:
(a) the distinctive serial designation of such series and the
number of shares constituting such series, provided that the aggregate
number of shares constituting all series of Preferred Stock shall not
exceed Twenty-five Million (25,000,000);
(b) the annual dividend rate on shares of such series, if any,
whether dividends shall be cumulative and, if so, from which date or
dates;
(c) whether the shares of such series shall be redeemable and,
if so, the terms and conditions of such redemption, including the date
or dates upon and after which such shares shall be redeemable, and the
amount per share payable in case of redemption, which amount may vary
under different conditions and at different redemption dates;
4
(2005 Restatement)
(d) the obligation, if any, of the corporation to retire
shares of such series pursuant to a sinking fund;
(e) whether shares of such series shall be convertible into,
or exchangeable for, shares of stock of any other class or classes and,
if so, the terms and conditions of such conversion or exchange,
including the price or prices or the rate or rates of conversion or
exchange and the terms of adjustment, if any;
(f) whether the shares of such series shall have voting
rights, in addition to the voting rights provided by law, and, if so,
the terms of such voting rights;
(g) the rights of the shares of such series in the event of
voluntary or involuntary liquidation, dissolution or winding up of the
corporation; and
(h) any other relative rights, powers, preferences,
qualifications, limitations or restrictions thereof relating to such
series.
The shares of Preferred Stock of any one series shall be identical with
each other in all respects except as to the dates from and after which dividends
thereon shall cumulate, if cumulative.
ARTICLE VIII.
Stated Capital
--------------
The minimum amount of stated capital with which the corporation will
begin business is $1,000.00.
ARTICLE IX.
Management and Additional Powers
--------------------------------
Section 1. The management and conduct of the business and affairs of
the corporation shall be vested in a Board of Directors which shall consist of
such number of directors, not less than three, the exact number to be fixed from
time to time solely by resolution of the Board of Directors, acting by not less
than a majority of the directors then in office.
Section 2. The Board of Directors shall be divided into three classes,
with the term of office of one class expiring each year. At the Annual Meeting
of Shareholders in 1986, two directors of the first class shall be elected to
hold office for a term expiring at the 1987 Annual Meeting, two directors of the
second class shall be elected to hold office for a term expiring at the 1988
Annual Meeting, and one director of the third class shall be elected to hold
office for a term expiring at the 1989 Annual Meeting. Commencing
5
(2005 Restatement)
with the Annual Meeting of Shareholders in 1987, each class of directors whose
term shall then expire shall be elected to hold office for a three-year term. In
the case of any vacancy on the Board of Directors, including a vacancy created
by an increase in the number of directors, the vacancy shall be filled by
election of the Board of Directors with the director so elected to serve for the
remainder of the term of the director being replaced or, in the case of an
additional director, for the remainder of the term of the class to which the
director has been assigned. All directors shall continue in office until the
election and qualification of their respective successors in office. When the
number of directors is changed, any newly created directorships or any decrease
in directorships shall be so assigned among the classes by a majority of the
directors then in office, though less than a quorum, as to make all classes as
nearly equal in number as possible. No decrease in the number of directors shall
have the effect of shortening the term of any incumbent director.
Section 3. Any director or directors may be removed from office at any
time, but only for cause and only by the affirmative vote of at least 80% of the
votes entitled to be cast by holders of all the outstanding shares of Voting
Stock (as defined in Article XIII hereof), voting together as a single class.
Section 4. The Board of Directors shall have the authority to accept or
reject subscriptions for capital stock made after incorporation and may grant
options to purchase or subscribe for capital stock. The Board of Directors
shall, from time to time, fix and determine the consideration for which the
corporation shall issue and sell its capital stock, and also the dividends to be
paid by the corporation upon the capital stock. The Board of Directors shall
have authority to fix the terms and conditions of rights to convert any
securities of this corporation into shares and to authorize the issuance of such
conversion rights.
Section 5. The Board of Directors shall have the authority to issue
bonds, debentures or other securities convertible into capital stock or other
securities of any class, or bearer warrants or other evidences of optional
rights to purchase and/or subscribe to capital stock or other securities of any
class, upon such terms, in such manner, and under such conditions as may be
fixed by resolution of the Board prior to the issue thereof.
Section 6. The Board of Directors shall have the authority to make and
alter the Bylaws, subject to the power of the shareholders to change or repeal
the Bylaws.
Section 7. A quorum for any meeting of shareholders to transact
business of this corporation, except as otherwise specifically provided herein
or by law, shall be the presence in person or by proxy of the holders of a
majority of the shares of common stock of the corporation outstanding and of
record on the record date set for such meeting.
Section 8. Notwithstanding any other provision of these Articles of
Incorporation or of law which might otherwise permit a lesser vote or no vote,
but in addition to any
6
(2005 Restatement)
affirmative vote of the holders of any particular class of Voting Stock required
by law or these Articles of Incorporation, the affirmative vote of at least 80%
of the votes entitled to be cast by holders of all the outstanding shares of
Voting Stock (as defined in Article XIII hereof), voting together as a single
class, shall be required to alter, amend or repeal this Article IX.
ARTICLE X.
Directors
---------
The first Board of Directors shall be comprised of one person whose
name and address are as follows:
Manuel A. Villafana
2220 Innsbruck Parkway
Columbia Heights, Minnesota 55421
ARTICLE XI.
Incorporators
-------------
The name and address of the incorporator is as follows:
Thomas H. Garrett III
4200 IDS Center
80 South Eighth Street
Minneapolis, Minnesota 55402
ARTICLE XII.
Amendment
---------
Any provisions contained in these Articles of Incorporation may be
amended solely by the affirmative vote of the holder of a majority of the stock
entitled to vote.
7
(2005 Restatement)
ARTICLE XIII.
Fair Price Provisions
---------------------
Section 1. In addition to all other requirements imposed by law or
these Articles of Incorporation (including Article VI hereof), and except as
otherwise expressly provided in Section 2 of this Article XIII, a Business
Combination (as hereinafter defined) shall require the affirmative vote of not
less than seventy-five percent (75%) of the votes entitled to be cast by the
holders of all then outstanding shares of Voting Stock (as hereinafter defined),
voting together as a single class. Such affirmative vote shall be required
notwithstanding the fact that no vote may be required, or that a lesser
percentage or separate class vote may be specified, by law or by any other
provision of these Articles of Incorporation or in any agreement with any
national securities exchange or otherwise.
Section 2. The provisions of Section 1 of this Article XIII shall not
be applicable to any particular Business Combination, and such Business
Combination shall require only such affirmative vote, if any, as is required by
law or by any other provision of these Articles of Incorporation or in any
agreement with any national securities exchange or otherwise, if the conditions
specified in either of the following Paragraphs 1 or 2 are met:
1. The Business Combination shall have been approved by a
majority of the Continuing Directors (as hereinafter defined).
2. All of the following conditions shall have been met:
a. The aggregate amount of cash and the Fair Market
Value (as hereinafter defined) as of the date of the
consummation of the Business Combination of consideration
other than cash to be received per share by holders of Common
Stock in such Business Combination shall be at least equal to
the higher amount determined under clauses (i) and (ii) below:
(i) (if applicable) the highest per share
price (including any brokerage commissions, transfer
taxes and soliciting dealers' fees) paid by or on
behalf of the Interested Shareholder (as hereinafter
defined) for any share of common stock in connection
with the acquisition by the Interested Shareholder of
beneficial ownership of shares of common stock (a)
within the two-year period immediately prior to the
date of the first public announcement of the proposed
Business Combination (the "Announcement Date") or (b)
in the transaction in which it became an Interested
Shareholder, whichever is higher; and
(ii) the Fair Market Value per share of
common stock on the Announcement Date or on the date
on which the Interested Shareholder became an
Interested Shareholder (such latter date
8
(2005 Restatement)
being referred to herein as the "Determination
Date"), whichever is higher.
b. The aggregate amount of cash and the Fair Market
Value as of the date of the consummation of the Business
Combination of consideration other than cash to be received
per share by holders of shares of any class or series of
outstanding capital stock (as hereinafter defined), other than
common stock, shall be at least equal to the highest amount
determined under clauses (i), (ii) and (iii) below:
(i) (if applicable) the highest per share
price (including any brokerage commissions, transfer
taxes and soliciting dealers' fees) paid by or on
behalf of the Interested Shareholder for any share of
such class or series of Capital Stock in connection
with the acquisition by the Interested Shareholder of
beneficial ownership of shares of such class or
series of Capital Stock (a) within the two-year
period immediately prior to the Announcement Date or
(b) in the transaction in which it became an
Interested Shareholder, whichever is higher;
(ii) the Fair Market Value per share of such
class or series of Capital Stock on the Announcement
Date or on the Determination Date, whichever is
higher; and
(iii) (if applicable) the highest
preferential amount per share to which the holders of
shares of such class or series of Capital Stock would
be entitled in the event of any voluntary or
involuntary liquidation, dissolution or winding up of
the affairs of the corporation, regardless of whether
the Business Combination to be consummated
constitutes such an event.
The provisions of this Paragraph 2.b shall
be required to be met with respect to every
class or series of outstanding Capital
Stock, whether or not the Interested
Shareholder has previously acquired
beneficial ownership of any shares of a
particular class or series of Capital Stock.
c. The consideration to be received by holders of a
particular class or series of outstanding Capital Stock shall
be in cash or in the same form as previously has been paid by
or on behalf of the Interested Shareholder in connection with
its direct or indirect acquisition of beneficial ownership of
shares of such class or series of Capital Stock. If the
consideration so paid for shares of any class or series of
Capital Stock varied as to form, the form of consideration for
such class or series of Capital
9
(2005 Restatement)
Stock shall be either cash or the form used to acquire
beneficial ownership of the largest number of shares of such
class or series of Capital Stock previously acquired by the
Interested Shareholder. The price determined in accordance
with Paragraphs 2.a and 2.b of Section 2 of this Article XIII
shall be subject to appropriate adjustment in the event of any
stock dividend, stock split, combination of shares or similar
event.
d. After such Interested Shareholder has become an
Interested Shareholder and prior to the consummation of such
Business Combination: (i) there shall have been no failure to
declare and pay at the regular date therefore any full
quarterly dividends (whether or not cumulative) payable in
accordance with the terms of any outstanding Capital Stock
having a preference over the common stock as to dividends, or
upon liquidation, except as approved by a majority of the
Continuing Directors; (ii) there shall have been no reduction
in the annual rate of dividends paid on the common stock
(except as necessary to reflect any stock dividend, stock
split, combination of shares or similar event), except as
approved by a majority of the Continuing Directors; (iii)
there shall have been an increase in the annual rate of
dividends paid on the common stock as necessary to reflect any
reclassification (including any reverse stock split),
recapitalization, reorganization or any similar transaction
that has the effect of reducing the number of outstanding
shares of common stock, unless the failure to increase such
annual rate is approved by a majority of the Continuing
Directors; and (iv) except as approved by a majority of the
Continuing Directors, such Interested Shareholder shall not
have become the beneficial owner of any additional shares of
Capital Stock except as part of the transaction that results
in such Interested Shareholder becoming an Interested
Shareholder and except in the transaction that, after giving
effect thereto, would not result in any increase in the
Interested Shareholder's percentage beneficial ownership of
any class or series of Capital Stock.
e. After such Interested Shareholder has become an
Interested Shareholder, such Interested Shareholder shall not
have received the benefit, directly or indirectly (except
proportionately as a shareholder of the corporation), of any
loans, advances, guarantees, pledges or other financial
assistance or any tax credits or other tax advantages provided
by the corporation, whether in anticipation of or in
connection with such Business Combination or otherwise.
f. A proxy or information statement describing the
proposed Business Combination and complying with the
requirements of the Securities Exchange Act of 1934 (the
"Act") and the rules and regulations thereunder (or any
subsequent provisions replacing such Act, rules or
regulations) shall be mailed to all shareholders of the
corporation at least 30 days prior to the consummation of such
Business Combination (whether of not such proxy or information
statement is required to be mailed pursuant to the Act or
subsequent provisions). The proxy or
10
(2005 Restatement)
information statement shall contain on the first page thereof,
in a prominent place, any statement as to the advisability (or
inadvisability) of the Business Combination that a majority of
the Continuing Directors may choose to make and, if deemed
advisable by a majority of the Continuing Directors as to the
fairness (or lack of fairness) of the terms of the Business
Combination from a financial point of view to the holders of
the outstanding shares of Capital Stock other than the
Interested Shareholder and its Affiliates (as hereinafter
defined) or Associates (as hereinafter defined).
g. Such Interested Shareholder shall not have made or
caused to be made any major change in the corporation's
business or equity capital structure without the approval of a
majority of the Continuing Directors.
Section 3. For the purpose of this Article XIII:
1. The term "Business Combination" shall mean:
a. any merger, consolidation or statutory exchange of
shares of the corporation or any Subsidiary (as hereinafter
defined) with (i) any Interested Shareholder or (ii) any other
corporation (whether or not itself an Interested Shareholder)
which is or after such merger, consolidation or statutory
share exchange would be an Affiliate or Associate of an
Interested Shareholder; provided, however, that the foregoing
shall not include the merger of a wholly owned Subsidiary of
the corporation into the corporation or the merger of two or
more wholly owned Subsidiaries of the corporation; or
b. any sale, lease, exchange, mortgage, pledge,
transfer or other disposition (in one transaction or a series
of transactions) to or with an Interested Shareholder or any
Affiliate or Associate of any Interested Shareholder of any
assets of the corporation or any Subsidiary equal to or
greater than ten percent (10%) of the book value of the
consolidated assets of the corporation; or
c. any sale, lease, exchange, mortgage, pledge,
transfer or other disposition (in one transaction or a series
of transactions) to or with the corporation or any Subsidiary
of any assets of any Interested Shareholder or any Affiliate
or Associate of any Interested Shareholder equal to or greater
than ten percent (10%) of the book value of the consolidated
assets of the corporation; or
d. the issuance or transfer by the corporation or any
Subsidiary (in one transaction or a series of transactions) to
any Interested Shareholder or any Affiliate or Associate of
any Interested Shareholder of
11
(2005 Restatement)
any securities of the corporation (except pursuant to stock
dividends, stock splits, or similar transactions which would
not have the effect, directly or indirectly, of increasing the
proportionate share of any class or series of Capital Stock,
or any securities convertible into Capital Stock or into
equity securities of any Subsidiary, that is beneficially
owned by any Interested Shareholder, directly or indirectly,
of increasing the proportionate share of any class or series
of Capital Stock, or any securities convertible into Capital
Stock or into equity securities of any Subsidiary, that is
beneficially owned by any Interested Shareholder or any
Affiliate or Associate of any Interested Shareholder) or of
any securities of a Subsidiary (except pursuant to a pro rata
distribution to all holders of common stock of the
corporation); or
e. 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 any Affiliate or
Associate of any Interested Shareholder; or
f. any transaction (whether or not with or otherwise
involving and Interested Shareholder) that has the effect,
directly or indirectly, of increasing the proportionate share
of any class or series of Capital Stock, or any securities
convertible into Capital Stock or into equity securities of
any Subsidiary, that is beneficially owned by any Interested
Shareholder or any Affiliate or Associate of any Interested
Shareholder, including, without limitation, any
reclassification of securities (including any reverse stock
split), or recapitalization of the corporation, or any merger,
consolidation or statutory exchange of shares of the
corporation with any of its Subsidiaries; or
g. any agreement, contract or other agreement or
understanding providing for any one or more of the actions
specified in the foregoing clauses (a) to (f).
2. The term "Capital Stock" shall mean all capital stock of
the corporation authorized to be issued from time to time under Article
VII of these Articles of Incorporation. The term "Voting Stock" shall
mean all Capital Stock of the corporation entitled to vote generally in
the election of directors of the corporation.
3. The term "person" shall mean any individual, firm,
corporation or other entity and shall include any group comprised of
any person and any other person or persons with whom such person or any
Affiliate or Associate of such person has any agreement, arrangement or
understanding, directly or indirectly, for the purpose of acquiring,
holding, voting, or disposing of Capital Stock.
12
(2005 Restatement)
4. The term "Interested Shareholder" shall mean any person
(other than the corporation or any Subsidiary and other than any
profit-sharing, employee stock ownership or other employee benefit plan
of the corporation or any Subsidiary or any trustee of or fiduciary
with respect to any such plan when acting in such capacity) who (a) is
the beneficial owner of Voting Stock representing ten percent (10%) or
more of the votes entitled to be cast by the holders of all then
outstanding shares of Voting Stock; or (b) is an Affiliate or Associate
of the corporation and at any time within the two-year period
immediately prior to the date in question was the beneficial owner of
Voting Stock representing ten percent (10%) or more of the votes
entitled to be cast by the holders of all then outstanding shares of
Voting Stock; or (c) is an assignee of or has otherwise succeeded to
any shares of Voting Stock which were at any time within the two-year
period immediately prior to the date in question beneficially owned by
an Interested Shareholder, if such assignment or succession shall have
occurred in the course of a transaction or series of transactions not
involving a public offering within the meaning of the Securities Act of
1933.
5. A person shall be a "beneficial owner" of any Capital Stock
(a) which such person or any of its Affiliates or Associates
beneficially owns, directly or indirectly; (b) which such person or any
of its Affiliates or Associates has, directly or indirectly, (i) the
right to acquire (whether such right is exercisable immediately or
subject only to the passage of time), pursuant to any agreement,
arrangement or understanding or upon the exercise of conversion rights,
exchange rights, warrants or options, or otherwise, or (ii) the right
to vote pursuant to any agreement, arrangement or understanding, or
(iii) the right to dispose or direct the disposition of, 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 Capital Stock. For the
purposes of determining whether a person is an Interested Shareholder
pursuant to Paragraph 4 of this Section 3, the number of shares of
Capital Stock deemed to be outstanding shall include shares deemed
beneficially owned by such person through application of this Paragraph
5, but shall not include any other shares of Capital Stock that may be
issuable pursuant to any agreement, arrangement or understanding, or
upon exercise of conversion rights, exchange rights, warrants or
options, or otherwise.
6. The term "Affiliate," used to indicate a relationship with
a specified person, shall mean a person that directly, or indirectly
through one or more intermediaries, controls, or is controlled by, or
is under common control with, such specified person. The term
"Associate," used to indicate a relationship with a specified person,
shall mean (a) any person (other than the corporation or a Subsidiary)
of which such specified person is an officer or partner or is, directly
or indirectly, the beneficial owner of ten percent (10%) or more of any
class of equity securities, (b) any trust or other estate in which such
specified person has a
13
substantial beneficial interest or as to which such specified person
serves as a trustee or in a similar fiduciary capacity, (c) any
relative or spouse of such specified person or any relative of such
spouse, who has the same home as such specified person or who is a
director or officer of the corporation or any Subsidiary, and (d) any
person who is a director or officer of such specified person or any of
its parents or subsidiaries (other than the corporation or a
Subsidiary).
7. The term "Subsidiary" shall mean any corporation of which a
majority of any class of equity security is beneficially owned,
directly or indirectly, by the corporation; provided, however, that for
the purposes of Paragraph 4 of this Section 3, the term "Subsidiary"
shall mean only a corporation of which a majority of each class of
equity security is beneficially owned, directly or indirectly, by the
corporation.
8. The term "Continuing Director" shall mean any member of the
Board of Directors of the corporation, while such person is a member of
the Board of Directors, who was a member of the Board of Directors
prior to the time that the Interested Shareholder involved in the
Business Combination in question became an Interested Shareholder, and
any member of the Board of Directors, while such person is a member of
the Board of Directors, whose election, or nomination for election by
the corporation's shareholders, was approved by a vote of a majority of
the Continuing Directors; provided, however, that in no event shall an
Interested Shareholder involved in the Business Combination in question
or any Affiliate, Associate or representative of such Interested
Shareholder, be deemed to be a Continuing Director.
9. The term "Fair Market Value" shall mean (a) in the case of
cash, the amount of such cash; (b) in the case of stock, on the
principal United States securities exchange registered under the Act on
which such stock is listed, or, if such stock is not listed on any such
exchange, the highest closing sale or closing bid quotation (whichever
is applicable) with respect to a share of such stock during the 30-day
period immediately preceding the date in question of a share of such
stock on the National Association of Securities Dealers, Inc. Automated
Quotations System or any similar system then in use, or if no such
quotations are available, the fair market value on the date in question
of a share of such stock as determined by a majority of the Continuing
Directors in good faith; and (c) in the case of property other than
cash or stock, the fair market value of such property on the date in
question as determined in good faith by a majority of the Continuing
Directors.
10. In the event of any Business Combination in which the
corporation survives, the phrase "consideration other than cash to be
received" as used in Paragraphs 2.a and 2.b of Section 2 of this
Article XIII shall include the shares of common stock and/or the shares
of any other class or series of Capital Stock retained by the holders
of such shares.
14
(2005 Restatement)
Section 4. The Continuing Directors by majority vote shall have the
power to determine for the purposes of this Article XIII, on the basis of
information known to them after reasonable inquiry, (a) whether a person is an
Interested Shareholder, (b) the number of shares of Capital Stock (including
Voting Stock) or other securities beneficially owned by any person, (c) whether
a person is an Affiliate or Associate of another, (d) whether the assets that
are the subject of any Business Combination equal or exceed ten percent (10%) of
the book value of the consolidated assets of the corporation, (e) whether a
proposed plan of dissolution or liquidation is proposed by or on behalf of an
Interested Shareholder or any Affiliate or Associate of any Interested
Shareholder, (f) whether any transaction has the effect, directly or indirectly,
of increasing the proportionate share of any class or series of Capital Stock,
or any securities convertible into Capital Stock or into equity securities of
any Subsidiary, that is beneficially owned by an Interested Shareholder or any
Affiliate or Associate of an Interested Shareholder, (g) whether any Business
Combination satisfies the conditions set forth in Paragraph 2 of Section 2 of
this Article XIII, and (h) such other matters with respect to which a
determination is required under this Article XIII. Any such determination made
in good faith shall be binding and conclusive on all parties.
Section 5. Nothing contained in this Article XIII shall be construed to
relieve any Interested Shareholder from any fiduciary obligation imposed by law.
Section 6. The fact that any Business Combination complies with the
provisions of Section 2 of this Article XIII shall not be construed to impose
any fiduciary duty, obligation or responsibility on the Board of Directors, or
any member thereof, or the Continuing Directors, or any of them, to approve such
Business Combination or recommend its adoption or approval to the shareholders
of the corporation, nor shall such compliance limit, prohibit or otherwise
restrict in any manner the Board of Directors, or any member thereof, or the
Continuing Directors, or any of them, with respect to evaluations of or actions
and responses taken with respect to such Business Combination. The Board of
Directors of the corporation, when evaluating any actions or transactions
described in Section 2 of this Article XIII, shall, in connection with the
exercise of its judgment in determining what is in the best interests of the
corporation and its shareholders, give due consideration to all relevant factors
including without limitation the social and economic effects on the employees,
customers, suppliers and other constituents of the corporation and its
subsidiaries and on the communities in which the corporation and its
subsidiaries operate or are located.
Section 7. Notwithstanding any other provisions of these Articles of
Incorporation (and notwithstanding the fact that a lesser percentage or separate
class vote may be specified by law or these Articles of Incorporation), the
affirmative vote of the holders of not less than 80% of the votes entitled to be
cast by the holders of all then outstanding shares of Voting Stock, voting
together as a single class, shall be required to amend or repeal, or adopt any
provisions inconsistent with this Article XIII.
15
(2005 Restatement)
ARTICLE XIV.
Director Liability
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No director of this Corporation shall be personally liable to the
Corporation or its shareholders for monetary damages for breach of fiduciary
duty as a director, except for liability (i) for any breach of the director's
duty of loyalty to the Corporation or its shareholders; (ii) for acts or
omissions not in good faith or that involve intentional misconduct or a knowing
violation of law; (iii) under Sections 302A.559 or 80A.23 of the Minnesota
Statutes; (iv) for any transaction from which the director derived any improper
personal benefit; or (v) for any act or omission occurring prior to the date
when this provision becomes effective.
The provisions of this Article shall not be deemed to limit or preclude
indemnification of a director by the Corporation for any liability of a director
which has not been eliminated by the provisions of this Article.
If the Minnesota Statutes hereafter are amended to authorize the
further elimination or limitation of the liability of directors, then the
liability of a director of the Corporation shall be eliminated or limited to the
fullest extent permitted by the amended Minnesota Statutes.
16
(2005 Restatement)