Exhibit 4.01
CERTIFICATE OF DESIGNATION
of
6.365% CUMULATIVE PREFERRED STOCK, SERIES F
of
TRAVELERS GROUP INC.
______________________________
pursuant to Section 151 of the
General Corporation Law of the State of Delaware
______________________________
TRAVELERS GROUP INC., a Delaware corporation (the "Corporation"),
hereby certifies that:
1. The Restated Certificate of Incorporation, as amended, of the
Corporation (the "Certificate of Incorporation") fixes the total number of
shares of all classes of capital stock that the Corporation shall have the
authority to issue at one billion five hundred million (1,500,000,000) shares of
common stock, par value $.01 per share ("Common Stock") and thirty million
(30,000,000) shares of preferred stock, par value $1.00 per share ("Preferred
Stock").
2. The Certificate of Incorporation expressly grants to the Board of
Directors of the Corporation (the "Board of Directors") authority to provide for
the issuance of the shares of Preferred Stock in series, and to establish from
time to time the number of shares to be included in each such series and to fix
the designation, powers, preferences and rights of the shares of each such
series and the qualifications, limitations or restrictions thereof. Pursuant to
resolutions duly adopted by the Board of Directors in accordance with Section
141 of the General Corporation Law of the State of Delaware (the "DGCL"), the
Board of Directors has granted such authority to its Executive Committee (the
"Executive Committee").
3. Pursuant to the authority conferred upon the Board of Directors
by the Certificate of Incorporation, and upon the Executive Committee by
resolution of the Board of Directors, the Executive Committee, by action duly
taken on May 30, 1997, adopted resolutions that provide for a series of
Preferred Stock as follows:
RESOLVED, that an issue of a series of Preferred Stock is hereby
provided for, and the number of shares to be included in such series is
established, and the designation, powers, preference and rights, and
qualifications, limitations or restrictions thereof, of such series are fixed,
hereby as follows:
1. DESIGNATION AND NUMBER OF SHARES. The designation of
such series shall be 6.365% Cumulative Preferred Stock, Series F (the
"Series F Preferred Stock"), and the number of shares constituting
such series shall be 1,600,000. The number of authorized shares of
Series F Preferred Stock may be reduced (but not below the number of
shares thereof then outstanding) by further resolution duly adopted by
the Board of Directors or the Executive Committee and by the filing of
a certificate pursuant to the provisions of the DGCL stating that such
reduction has been so authorized, but the number of authorized shares
of Series F Preferred Stock shall not be increased.
2. DIVIDENDS. Dividends on each share of Series F
Preferred Stock shall be cumulative from the date of original issue of
such share and shall be payable, when and as declared by the Board of
Directors out of funds legally available therefor, in cash on March 1,
June 1, September 1 and December 1 of each year, commencing September
1, 1997.
Each quarterly period beginning on February 15, May 15,
August 15 and November 15 in each year and ending on and including the
day next preceding the first day of the next such quarterly period
shall be a "Dividend Period." If a share of Series F Preferred Stock
is outstanding during an entire Dividend Period, the dividend payable
on such share on the first day of the calendar month immediately
following the last day of such Dividend Period shall be $3.978125 (or
one-fourth of 6.365% of the Liquidation Preference (as defined in
Section 7) for such share). If a share of Series F Preferred Stock is
outstanding for less than an entire Dividend Period, the dividend
payable on such share on the first day of the calendar month
immediately following the last day of such Dividend Period on which
such share shall be outstanding shall be the product of $3.978125
multiplied by the ratio (which shall not exceed one) that the number
of days that such share was outstanding during such Dividend Period
bears to the number of days in such Dividend Period.
If, prior to 18 months after the date of the original
issuance of the Series F Preferred Stock, one or more amendments to
the Internal Revenue Code of 1986, as amended (the "Code") are enacted
that reduce the percentage of the dividends-received deduction
(currently 70%) as specified in section 243(a)(1) of the Code or any
successor provision (the "Dividends-Received Percentage"), the amount
of each dividend
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payable (if declared) per share of Series F Preferred Stock for dividend
payments made on or after the effective date of such change in the Code
will be adjusted by multiplying the amount of the dividend payable
described above (before adjustment) by the following fraction (the "DRD
Formula"), and rounding the result to the nearest cent (with one-half cent
rounded up):
1-.35(1-.70)
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1-.35(1-DRP)
For the purposes of the DRD Formula, "DRP" means the Dividends-Received
Percentage (expressed as a decimal) applicable to the dividend in question;
provided, however, that if the Dividends-Received Percentage applicable to
the dividend in question shall be less than 50%, then the DRP shall equal
.50. Notwithstanding the foregoing provisions, if, with respect to any
such amendment, the Company receives either an unqualified opinion of
nationally recognized independent tax counsel selected by the Company or a
private letter ruling or similar form of authorization from the
Internal Revenue Service ("IRS") to the effect that such amendment
does not apply to a dividend payable on the Series F Preferred Stock,
then such amendment will not result in the adjustment provided for
pursuant to the DRD Formula with respect to such dividend.
If any such amendment to the Code is enacted after the
dividend payable on a dividend payment date has been declared, the
amount of the dividend payable on such dividend payment date will not
be increased; instead, additional dividends (the "Post Declaration
Date Dividends") equal to the excess, if any, of (x) the product of
the dividend paid by the Company on such dividend payment date and the
DRD Formula (where the DRP used in the DRD Formula would be equal to
the greater of the Dividends-Received Percentage applicable to the
dividend in question and .50) over (y) the dividend paid by the
Company on such dividend payable date, will be payable (if declared)
to holders of Series F Preferred Stock on the record date applicable
to the next succeeding dividend payment date or, if the Series F
Preferred Stock is called for redemption prior to such record date, to
holders of Series F Preferred Stock on the applicable redemption date,
as the case may be, in addition to any other amounts payable on such
date.
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If any such amendment to the Code is enacted and the
reduction in the Dividends-Received Percentage retroactively applies
to a dividend payment date as to which the Company previously paid
dividends on the Series F Preferred Stock (each, an "Affected Dividend
Payment Date"), the Company will pay (if declared) additional
dividends (the "Retroactive Dividends") to holders of Series F
Preferred Stock on the record date applicable to the next succeeding
dividend payment date (or, if such amendment is enacted after the
dividend payable on such dividend payment date has been declared, to
holders of Series F Preferred Stock on the record date following the
date of enactment) or, if the Series F Preferred Stock is called for
redemption prior to such record date, to holders of Series F Preferred
Stock on the applicable redemption date, as the case may be, in an
amount equal to the excess of (x) the product of the dividend paid by
the Company on each Affected Dividend Payment Date and the DRD Formula
(where the DRP used in the DRD Formula would be equal to the greater
of the Dividends-Received Percentage and .50 applied to each Affected
Dividend Payment Date) over (y) the sum of the dividend paid by the
Company on each Affected Dividend Payment Date.
Each dividend on the shares of Series F Preferred Stock
shall be paid to the holders of record of shares of Series F Preferred
Stock as they appear on the stock register of the Corporation on such
record date, not more than 60 days nor less than 10 days preceding the
payment date of such dividend, as shall be fixed in advance by the
Board of Directors. Dividends on account of arrears for any past
Dividend Periods may be declared and paid at any time, without
reference to any regular dividend payment date, to holders of record
on such date, not exceeding 45 days preceding the payment date
thereof, as may be fixed in advance by the Board of Directors.
If there shall be outstanding shares of any other class
or series of preferred stock of the Corporation ranking on a parity as
to dividends with the Series F Preferred Stock, the Corporation, in
making any dividend payment on account of arrears on the Series F
Preferred Stock or such other class or series of preferred stock,
shall make payments ratably upon all outstanding shares of Series F
Preferred Stock and such other class or series of preferred stock in
proportion to the respective amounts of dividends in arrears upon all
such outstanding shares of Series F
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Preferred Stock and such other class or series of preferred stock to the
date of such dividend payment.
Holders of shares of Series F Preferred Stock shall not
be entitled to any dividend, whether payable in cash, property or
stock, in excess of full cumulative dividends on such shares. No
interest, or sum of money in lieu of interest, shall be payable in
respect of any dividend payment that is in arrears.
3. REDEMPTION. The Series F Preferred Stock is not
subject to any mandatory redemption pursuant to a sinking fund or
otherwise. The Corporation, at its option, may redeem shares of Series
F Preferred Stock, as a whole or in part, at any time or from time to
time on or after June 16, 2007, at a price of $250 per share, plus
accrued and accumulated but unpaid dividends thereon to but excluding
the date fixed for redemption (the "Redemption Price").
If the Corporation shall redeem shares of Series F
Preferred Stock pursuant to this Section 3, notice of such redemption
shall be given by first class mail, postage prepaid, not less than 30
or more than 90 days prior to the redemption date, to each holder of
record of the shares to be redeemed, at such holder's address as shown
on the stock register of the Corporation. Each such notice shall
state: (a) the redemption date; (b) the number of shares of Series F
Preferred Stock to be redeemed and, if less than all such shares held
by such holder are to be redeemed, the number of such shares to be
redeemed from such holder; (c) the Redemption Price; (d) the place or
places where certificates for such shares are to be surrendered for
payment of the Redemption Price; and (e) that dividends on the shares
to be redeemed will cease to accrue on such redemption date. Notice
having been mailed as aforesaid, from and after the redemption date
(unless default shall be made by the Corporation in providing money
for the payment of the Redemption Price) dividends on the shares of
Series F Preferred Stock so called for redemption shall cease to
accrue, and such shares shall no longer be deemed to be outstanding,
and all rights of the holders thereof as stockholders of the
Corporation (except the right to receive from the Corporation the
Redemption Price) shall cease. Upon surrender in accordance with such
notice of the certificates for any shares so redeemed (properly
endorsed or assigned for transfer, if the Board of Directors shall so
require and the notice shall so state), the Corporation shall redeem
such shares at the Redemption Price. If
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less than all the outstanding shares of Series F Preferred Stock are to be
redeemed, the Corporation shall select those shares to be redeemed from
outstanding shares of Series F Preferred Stock not previously called for
redemption by lot or pro rata (as nearly as may be) or by any other method
determined by the Board of Directors to be equitable.
The Corporation shall not redeem less than all the
outstanding shares of Series F Preferred Stock pursuant to this
Section 3, or purchase or acquire any shares of Series F Preferred
Stock otherwise than pursuant to a purchase or exchange offer made on
the same terms to all holders of shares of Series F Preferred Stock,
unless full cumulative dividends shall have been paid or declared and
set apart for payment upon all outstanding shares of Series F
Preferred Stock for all past Dividend Periods, and unless all matured
obligations of the Corporation with respect to all sinking funds,
retirement funds or purchase funds for all series of Preferred Stock
then outstanding have been met.
4. SHARES TO BE RETIRED. All shares of Series F
Preferred Stock redeemed by the Corporation shall be retired and
canceled and shall be restored to the status of authorized but
unissued shares of Preferred Stock, without designation as to series,
and may thereafter be reissued.
5. CONVERSION OR EXCHANGE. The holders of shares of
Series F Preferred Stock shall not have any rights to convert any such
shares into or exchange any such shares for shares of any other class
or series of capital stock of the Corporation.
6. VOTING. Except as otherwise provided in this
Section 6 or as otherwise required by law, the Series F Preferred
Stock shall have no voting rights.
If six quarterly dividends (whether or not consecutive)
payable on shares of Series F Preferred Stock are in arrears at the
time of the record date to determine stockholders for any annual
meeting of stockholders of the Corporation, the number of directors of
the Corporation shall be increased by two, and the holders of shares
of Series F Preferred Stock (voting separately as a class with the
holders of shares of any one or more other series of Preferred Stock
upon which like voting rights have been conferred and are exercisable)
shall be entitled at such annual meeting of
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stockholders to elect two directors of the Corporation, with the remaining
directors of the Corporation to be elected by the holders of shares of any
other class or classes or series of stock entitled to vote therefor. In any
such election, holders of shares of Series F Preferred Stock shall have one
vote for each share held.
At all meetings of stockholders at which holders of
Preferred Stock shall be entitled to vote for Directors as a single
class, the holders of a majority of the outstanding shares of all
classes and series of capital stock of the Corporation having the
right to vote as a single class shall be necessary to constitute a
quorum, whether present in person or by proxy, for the election by
such single class of its designated Directors. In any election of
Directors by stockholders voting as a class, such Directors shall be
elected by the vote of at least a plurality of shares held by such
stockholders present or represented at the meeting. At any such
meeting, the election of Directors by stockholders voting as a class
shall be valid notwithstanding that a quorum of other stockholders
voting as one or more classes may not be present or represented at
such meeting.
Any director who has been elected by the holders of
shares of Series F Preferred Stock (voting separately as a class with
the holders of shares of any one or more other series of Preferred
Stock upon which like voting rights have been conferred and are
exercisable) may be removed at any time, with or without cause, only
by the affirmative vote of the holders of the shares at the time
entitled to cast a majority of the votes entitled to be cast for the
election of any such director at a special meeting of such holders
called for that purpose, and any vacancy thereby created may be filled
by the vote of such holders. If a vacancy occurs among the Directors
elected by such stockholders voting as a class, other than by removal
from office as set forth in the preceding sentence, such vacancy may
be filled by the remaining Director so elected, or his successor then
in office, and the Director so elected to fill such vacancy shall
serve until the next meeting of stockholders for the election of
Directors.
The voting rights of the holders of the Series F
Preferred Stock to elect Directors as set forth above shall continue
until all dividend arrearages on the Series F Preferred Stock have
been paid or declared and set apart for payment. Upon the termination
of such voting rights, the terms of office of all persons who may have
been elected pursuant to such voting rights shall
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immediately terminate, and the number of directors of the Corporation shall
be decreased by two.
Without the consent of the holders of shares entitled
to cast at least two-thirds of the votes entitled to be cast by the
holders of the total number of shares of Preferred Stock then
outstanding, voting separately as a class without regard to series,
with the holders of shares of Series F Preferred Stock being entitled
to cast one vote per share, the Corporation may not:
(i) create any class of stock that shall have
preference as to dividends or distributions of assets over the Series
F Preferred Stock; or
(ii) alter or change the provisions of the Certificate
of Incorporation (including any Certificate of Amendment or
Certificate of Designation relating to the Series F Preferred Stock)
so as to adversely affect the powers, preferences or rights of the
holders of shares of Series F Preferred Stock;
PROVIDED, however, that if such creation or such alteration or change
would adversely affect the powers, preferences or rights of one or
more, but not all, series of Preferred Stock at the time outstanding,
such alteration or change shall require consent of the holders of
shares entitled to cast at least two-thirds of the votes entitled to
be cast by the holders of all of the shares of all such series so
affected, voting as a class.
7. LIQUIDATION PREFERENCE. In the event of any
liquidation, dissolution or winding up of the Corporation, voluntary
or involuntary, the holders of Series F Preferred Stock shall be
entitled to receive out of the assets of the Corporation available for
distribution to stockholders, before any distribution of assets shall
be made to the holders of the Common Stock or of any other shares of
stock of the Corporation ranking as to such distribution junior to the
Series F Preferred Stock, a liquidating distribution in an amount
equal to $250 per share (the "Liquidation Preference") plus an amount
equal to any accrued and accumulated but unpaid dividends thereon to
the date of final distribution. The holders of the Series F Preferred
Stock shall not be entitled to receive the Liquidation Preference and
such accrued dividends, however, until the liquidation preference of
any other class of stock of the Corporation ranking senior to the
Series F Preferred Stock as to rights upon liquidation, dissolution or
winding up shall have
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been paid (or a sum set aside therefor sufficient to provide for payment)
in full.
If, upon any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the assets available for
distribution are insufficient to pay in full the amounts payable with
respect to the Series F Preferred Stock and any other shares of stock
of the Corporation ranking as to any such distribution on a parity
with the Series F Preferred Stock, the holders of the Series F
Preferred Stock and of such other shares shall share ratably in any
distribution of assets of the Corporation in proportion to the full
respective preferential amounts to which they are entitled.
After payment to the holders of the Series F Preferred
Stock of the full preferential amounts provided for in this Section 7,
the holders of the Series F Preferred Stock shall be entitled to no
further participation in any distribution of assets by the
Corporation.
Consolidation or merger of the Corporation with or into
one or more other corporations, or a sale, whether for cash, shares of
stock, securities or properties, of all or substantially all of the
assets of the Corporation, shall not be deemed or construed to be a
liquidation, dissolution or winding up of the Corporation within the
meaning of this Section 7 if the preferences or special voting rights
of the holders of shares of Series F Preferred Stock are not impaired
thereby.
8. LIMITATION ON DIVIDENDS ON JUNIOR STOCK. So long
as any Series F Preferred Stock shall be outstanding the Corporation
shall not declare any dividends on the Common Stock or any other stock
of the Corporation ranking as to dividends or distributions of assets
junior to the Series F Preferred Stock (the Common Stock and any such
other stock being herein referred to as "Junior Stock"), or make any
payment on account of, or set apart money for, a sinking fund or other
similar fund or agreement for the purchase, redemption or other
retirement of any shares of Junior Stock, or make any distribution in
respect thereof, whether in cash or property or in obligations or
stock of the Corporation, other than a distribution of Junior Stock
(such dividends, payments, setting apart and distributions being
herein called "Junior Stock Payments"), unless the following
conditions shall be satisfied at the date of such declaration in the
case of any such dividend, or the date of such setting apart in the
case of any such fund, or the date
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of such payment or distribution in the case of any other Junior Stock
Payment:
(i) full cumulative dividends shall have been paid or
declared and set apart for payment on all outstanding shares of
Preferred Stock other than Junior Stock; and
(ii) the Corporation shall not be in default or in
arrears with respect to any sinking fund or other similar fund or
agreement for the purchase, redemption or other retirement of any
shares of Preferred Stock other than Junior Stock;
PROVIDED, however, that any funds theretofore deposited in any sinking
fund or other similar fund with respect to any Preferred Stock in
compliance with the provisions of such sinking fund or other similar
fund may thereafter be applied to the purchase or redemption of such
Preferred Stock in accordance with the terms of such sinking fund or
other similar fund regardless of whether at the time of such
application full cumulative dividends upon shares of Series F
Preferred Stock outstanding to the last dividend payment date shall
have been paid or declared and set apart for payment by the
Corporation.
Travelers Group Inc. has caused this Certificate to be duly executed
by its Executive Vice President, and attested by its Assistant
Secretary this 16th day of June, 1997.
TRAVELERS GROUP INC.
By /s/ Charles O. Prince, III
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Charles O. Prince, III
Executive Vice President
Attest:
/s/ Shelley J. Dropkin
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Shelley J. Dropkin
Assistant Secretary
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