Exhibit 3(a)
[SEAL OF STATE OF NORTH CAROLINA DEPARTMENT OF THE SECRETARY OF STATE APPEARS
HERE]
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To all whom these presents shall come, Greetings:
I, Rufus L. Edmisten, Secretary of State of the State of North Carolina, do
hereby certify the following and hereto attached to be a true copy of
ARTICLES OF RESTATEMENT
OF
SOUTHERN NATIONAL CORPORATION
the original of which is now on file and a matter of record in this office.
IN WITNESS WHEREOF, I have hereunto set my hand
and affixed my official seal at the City of
Raleigh, this 3rd day of August, 1993.
[SEAL OF STATE OF NORTH CAROLINA DEPARTMENT OF THE SECRETARY OF STATE APPEARS
HERE]
/s/ Rufus L. Edmisten
Secretary of State
ARTICLES OF RESTATEMENT
Pursuant to (S) 55-10-06 and (S) 55-10-07 of the General Statutes of North
Carolina, the undersigned corporation hereby submits the following for the
purpose of amending and restating in full its Articles of Incorporation,
1. The name of the corporation is: Southern National Corporation, a North
Carolina corporation.
2. The text of the Amended and Restated Articles of Incorporation is attached
as Exhibit A.
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3. The Amended and Restated Articles of Incorporation contain amendments
requiring shareholder approval that were adopted by the Board of Directors
of the corporation on June 17, 1993 and were approved by shareholder action
on April 20, 1993 and May 17, 1993 as required by Chapter 55 of the North
Carolina General Statutes.
4. These Articles are to be effective upon filing.
This the 17th day of June, 1993.
SOUTHERN NATIONAL CORPORATION
By: /s/ David L. Craven, Senior
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David L. Craven, Senior
Vice President, General
Counsel and Secretary
"EXHIBIT #6"
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
SOUTHERN NATIONAL CORPORATION
ARTICLE I
The name of the Corporation is Southern National Corporation.
ARTICLE II
The period of duration of the Corporation shall be unlimited and
perpetual.
ARTICLE III
The purposes for which the Corporation is organized are:
(a) To act as a holding company; to operate, serve and conduct business
as a holding company of one or more banks and other corporations; to acquire and
own shares of stock or other interests in other businesses and corporations of
any lawful character including without limitation, banks, insurance agencies,
mortgage loan and servicing businesses, data processing businesses, factoring
businesses and other financially related businesses; to furnish services of all
types to and for such banks, corporations and businesses; and as shareholder or
as owner of other interests in such banks,
corporations and businesses, to exercise all rights, powers and privileges of
ownership incident thereto.
(b) To itself operate insurance agencies; to make and acquire mortgage
loans and render mortgage loan services; to render data processing services; to
render factoring services; to operate consumer and small loan businesses and to
make, acquire and service consumer and small loans; to organize, operate and
manage mutual funds; to render travel services; to operate credit card
businesses; to acquire, own and lease all types of equipment and property; to
engage in farming and forestry; to render farm and forestry management and
agency services and to engage in and operate all types of farming, agricultural
and forestry businesses; to lend its own money; to act as agent or broker in
procuring and making loans; and to render financial, management and business
services of all types.
(c) To engage in, operate, conduct, perform or participate in every kind
of financial, commercial, agricultural, mercantile, manufacturing, industrial,
mining, transportation or other enterprise, business, work, contract,
undertaking, venture, or operation.
(d) To carry on any other business to any extent and in any manner not
prohibited by the laws of North Carolina, or, where the Corporation may seek to
do business elsewhere, by local laws; and to engage in, operate and conduct any
business which may be deemed adapted, directly or indirectly, to add to the
profits of its principal businesses or to increase the value of its assets.
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(e) To do all and everything necessary, suitable, expedient or proper for
the accomplishment of any of the objects and purposes herein enumerated, or
incidental to the powers herein named, or incidental to the protection or
benefit of the Corporation, and, in general, to carry on any lawful business
necessary or incidental to the attainment of the objects or purposes of the
Corporation, or which may be conveniently carried on in connection with any of
the business of the Corporation, with all the powers now or hereafter conferred
by the laws of North Carolina upon corporations of like character.
ARTICLE IV
The Corporation shall have the authority to issue 120,000,000 shares of
Common Stock, par value $5 each, and 5,000,000 shares of Preferred Stock, par
value $5 each. The designations of each class are as follows:
a) The first class is Common Stock in the amount of 120,000,000 shares,
par value $5 each share.
b) The second class is Preferred Stock in the amount of 5,000,000 shares,
par value $5 each share. The Preferred Stock may be issued from time to time in
one or more series, and authority is expressly vested in the Board of Directors
without action of shareholders to divide the Preferred stock into series, to
provide for the issuance thereof, and to fix and determine the relative rights,
voting powers, preferences, limitations and designations of the shares of any
series so established.
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Authority is expressly vested in the Board of Directors, without limitation, to
determine: (1) The number of shares to constitute such series and the
distinctive designation thereof; (2) The dividend rate, conditions and time of
accrual and payment thereof, and the dividend preferences, if any, between the
classes of stock and between the series of Preferred Stock; (3) Whether
dividends shall be cumulative and, if, so, the date from which dividends on each
such series shall accumulate; (4) Whether, and to what extent, the holders of
one or more series of Preferred Stock shall enjoy voting rights, if any, in
addition to those prescribed by law; (5) Whether, and upon what terms, Preferred
Stock will be convertible into or exchangeable for shares of any class or any
other series of the same class; and (6) Whether, and upon what terms, the
Preferred Stock, will be redeemable, and the preference, if any, to which the
Preferred Stock will be entitled in the event of voluntary liquidation,
dissolution or winding up of the Corporation.
63/4% Cumulative Convertible Preferred Stock, Series A. The Corporation has
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designated 770,000 shares of the authorized but unissued shares of the
Corporation's Preferred stock, par value $5.00 per share, as 63/4% Cumulative
Convertible Preferred Stock, Series A (the "Series A Preferred Stock"). The
terms of the Series A Preferred Stock, in the respect in which the shares of
such series may vary from shares of any and all other series of Preferred Stock,
are as follows:
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(1) Stated Value. The Series A Preferred Stock shall have a stated value
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of $100.00 per share.
(2) Dividends and Distributions.
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(a) The holders of shares of Series A Preferred Stock shall be
entitled to receive, when and as declared by the Board of Directors, out of
assets of the Corporation legally available for payment, cash dividends,
accruing from the date of issuance, at the annual rate of $6.75 per share, and
no more, payable quarterly on February 15, May 15, August 15, and November 15 of
each year (each quarterly period ending on any such date being hereinafter
referred to as a "dividend period"), commencing May 15, 1992. The initial
dividend for the period commencing February 11, 1992 to, but not including,
May 15, 1992, will be $1.7625 per share and will be payable on May 15, 1992. The
date of initial issuance of shares of Series A Preferred Stock is hereinafter
referred to as the "Issue Date." Dividends payable on the Series A Preferred
Stock (i) for any period less than a full dividend period, shall be computed on
the basis of a 360-day year consisting of twelve 30-day months and (ii) for each
full dividend period, shall be computed by dividing the annual dividend rate by
four. Each such dividend will be payable to holders of record as they appear on
the stock register of the Corporation on such record dates, not more than 60
days nor less than 10 days preceding the payment dates, as shall be fixed by the
Board of Directors.
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(b) Dividends on shares of Series A Preferred Stock shall be
cumulative from the date of issue whether or not there shall be funds legally
available for payment thereof. Accumulations of dividends on Series A Preferred
Stock shall not bear interest. The Corporation shall not (i) declare or pay or
set apart for payment any dividends or distributions on any stock ranking as to
dividends junior to the Series A Preferred Stock (other than dividends paid in
shares of capital stock ranking junior to the Series A Preferred Stock as to
dividends and upon liquidation, dissolution or winding up or options, warrants
or rights to subscribe for such junior stock) or (ii) make any purchase or
redemption of, or any sinking fund payment for the purchase or redemption of,
any stock ranking as to dividends on a parity with or junior to the Series A
Preferred Stock (except by conversion into or exchange for capital stock of the
Corporation ranking junior to the Series A Preferred Stock as to dividends and
upon liquidation, dissolution or winding up) unless all dividends payable on all
outstanding shares of Series A Preferred Stock for all past dividend periods
shall have been paid in full or declared and a sufficient sum set apart for
payment thereof; provided, however, that any moneys theretofore deposited in any
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sinking fund with respect to any Preferred Stock of the Corporation in
compliance with the provisions of such sinking fund may thereafter be applied to
the purchase or redemption of such Preferred Stock in accordance with the terms
of such sinking fund regardless of whether at the time of such application all
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dividends payable on all outstanding shares of Series A Preferred Stock shall
have been paid in full or declared and a sufficient sum set apart for payment
thereof.
(c) All dividends declared on shares of Series A Preferred Stock and
any other class of Preferred Stock or series thereof ranking on a parity as to
dividends with the Series A Preferred Stock shall be declared pro rata, so that
the amount of dividends per share on the Series A Preferred Stock and such other
Preferred Stock for the same dividend period, or for the dividend period of the
Series A Preferred Stock ending within the dividend period of such other stock,
shall, in all cases, bear to each other the same ratio that accured dividends
per share on shares of the Series A Preferred Stock and such other stock bear to
each other.
(3) Liquidation Preferences.
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(a) In the event of any liquidation, dissolution or winding up of the
affairs of the Corporation, whether voluntary or involuntary, the holders of
Series A Preferred Stock shall be entitled to receive out of the assets of the
Corporation available for distribution to shareholders an amount equal to
$100.00 per share plus an amount equal to any accrued and unpaid dividends
thereon to but excluding the date of such distribution, and no more, before any
distribution shall be made to the holders of any class of stock of the
Corporation ranking junior to the Series A Preferred Stock as to liquidation
payments, but the holders of Series A Preferred Stock shall not be entitled to
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receive such distribution until the liquidation preference of any other shares
of the Corporation's capital stock ranking senior to the Series A Preferred
Stock with respect to rights upon liquidation, dissolution or winding up shall
have been paid (or a sufficient sum set aside for payment thereof) in full.
(b) In the event the assets of the Corporation available for
distribution to shareholders upon any liquidation, dissolution or winding up of
the affairs of the Corporation, whether voluntary or involuntary, shall be
insufficient to pay in full the amounts payable with respect to the Series A
Preferred Stock and any other shares of Preferred Stock of the Corporation
ranking on a parity with the Series A Preferred Stock as to the distribution of
assets, the holders of the Series A Preferred Stock and the holders of such
other Preferred Stock shall share ratably in any distribution of assets of the
Corporation in proportion to the full respective preferential amounts to which
they are entitled.
(c) The merger or consolidation of the Corporation into or with any
other corporation, the merger or consolidation of any other Corporation into or
with the Corporation or the sale, lease or conveyance of all or part of the
property or business of the Corporation shall not be deemed a liquidation,
dissolution or winding up of the affairs of the Corporation within the meaning
of this Paragraph 3.
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(4) Redeption.
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(a) The Corporation, at its option, may redeem any or all shares of
Series A Preferred Stock at any time on or after March 1, 1996, at the redeption
prices set forth below, plus an amount equal to accrued and unpaid dividends
thereon to but excluding the date of redemption (the "Redemption Price"):
Twelve month period
begginning March 1, Redemption Price
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1996............................. $104.050
1997............................. 103.375
1998............................. 102.700
1999............................. 102.025
2000............................. 101.350
2001............................. 101.675
2002 and thereafter ............. 100.00
(b) If less than all the outstanding shares of Series A Preferred
Stock are to be redeemed, the shares to be redeemed shall be selected pro rata
as nearly as practicable or by lot, or by such other method as the Board of
Directors may determine to be equitable (with adjustments to avoid fractional
shares).
(c) Notice of an redemption shall be given by first class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
date fixed for redemption to the holders of record of the shares of Series A
Preferred Stock to be redeemed, at their respective addresses appearing on the
books of the Corporation. Notice so mailed shall be conclusively presumed to
have been duly given whether or not actually received. Such notice shall
state: (i) the date fixed for redemption; (ii) the Redemption Price; (iii)
that the holder has the right to convert
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such shares into Common Stock until the close of business on the redemption
date; (iv) the then-effective conversion price and the place where certificates
for such shares may be surrendered for conversion; (v) if less than all the
shares held by such holder are tobe redeemed, the number of shares to be
redeemed form such holder; (vi) the place where certificates for such shares are
to be surrendered for payment of the Redemption Price; and (vii) that after such
date fixed for redemption the shares to be redeemed shall not accrue dividends.
(d) At the option of the Corporation, if notice of redemption is mailed
as aforesaid, and if prior to the date fixed for redemption funds sufficient to
pay in full the Redemption Price are deposited in trust, for the account of the
holders of the shares to be redeemed, with a bank or trust company named in such
notice doing business in the Borough of Manhattan, the City of New York, State
of New York or the State of North Carolina and having capital surplus and
undivided profits of at least $50 million (which bank or trust company also may
be the transfer agent and/or paying agent for the Series A Preferred Stock)
notwithstanding the fact that any certificate(s) for shares called for
redemption shall not have been surrendered for cancellation, on and after such
date of deposit the shares represented thereby so called for redemption shall
be deemed to be no longer outstanding, and all rights of the holders of such
shares as shareholders of the Corporation shall cease, except the right of the
holders thereof to convert such shares in accordance
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with the provisions of Paragraph 5 at any time prior to the close of business on
the redemption date and the right of the holders thereof to receive out of the
funds so deposited in trust the Redemption Price, without interest, upon such
surrender of the certificate(s) representing such shares. Any funds so deposited
with such bank or trust company in respect of shares of Series A Preferred Stock
converted before the close of business on the redemption date shall be returned
to the Corporation upon such conversion. Any funds so deposited with such bank
or trust company which shall remain unclaimed by the holders of shares called
for redemption at the end of two years after the redemption date shall be repaid
to the Corporation, on demand, and thereafter the holder of any such shares
shall look only to the Corporation for the payment, without interest, of the
Redemption Price.
(e) Any provision of this Paragraph 4 to the contrary
notwithstanding, in the event that any quarterly dividend payable on the Series
A Preferred Stock shall be in arrears and until all such dividends in arrears
shall have been paid or declared and set apart for payment, the Corporation
shall not redeem any shares of Series A Preferred Stock unless all outstanding
shares of Series A Preferred Stock are simultaneously redeemed and shall not
purchase or otherwise acquire any shares of Series A Preferred Stock except in
accordance with a purchase offer made by the Corporation on the same terms to
all holders of record of Series A Preferred Stock.
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(5) Conversion Rights. The holders of shares of Series A Preferred
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Stock shall have the right, at their option, to convert such shares into shares
of Common Stock on the following terms and conditions:
(a) Shares of Series A Preferred Stock shall be convertible at
any time on the basis of their stated value into fully paid and nonassessable
shares of Common Stock at a conversion price of $16.93 per share of Common Stock
(the "Conversion Price"). The Conversion Price shall be subject to adjustment
from time to time as hereinafter provided. No payment or adjustment shall be
made on account of any accrued and unpaid dividends on shares of Series A
Prefered Stock surrendered for conversion prior to the record date for the
determination of shareholders entitled to such dividends or on account of any
dividends on the shares of Common Stock issued upon such conversion subsequent
to the record date for the determination of shareholders entitled to such
dividends. If any shares of Series A Preferred Stock shall be called for
redemption, the right to convert the shares designated for redemption shall
terminate at the close of business on the date fixed for redemption unless
default is made in the payment of the Redemption Price. In the event of default
in the payment of the Redemption Price. In the event of default in the payment
of the Redemption Price, the right to convert the shares designated for
redemption shall terminate at the close of business on the date that such
default is cured.
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(b) To convert shares of Series A Preferred Stock into Common
Stock, the holder thereof shall surrender the certificate therefor, duly
endorsed if the Corporation shall so require, or accompanied by appropriate
instruments of transfer satisfactory to the Corporation, at the office of the
Transfer Agent for the Series A Preferred Stock, or at such other office as may
be designated by the Corporation, together with written notice that such holder
irrevocably elects to convert such shares. Such notice shall also state the
name and address in which such holder wishes the certificate for the shares of
Common Stock issuable upon conversion to be issued. As soon as practicable
after receipt of the certificate representing the shares of Series A Preferred
Stock to be converted and the notice of election to convert the same, the
Corporation shall issue and deliver at said office a certificate or certificates
for the number of whole shares of Common Stock issuable upon conversion of the
shares of Series A Preferred Stock surrendered for conversion, together with a
cash payment in lieu of any fraction of a share, as hereinafter provided, to the
person entitled to receive the same. Shares of Series A Preferred Stock shall
be deemed to have been converted immediately prior to the close of business on
the date such shares are surrendered for conversion and notice of election to
convert the same is received by the Corporation in accordance with the foregoing
provisions, and the person entitled to receive the Common Stock issuable upon
such
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conversion shall be deemed for all purposes to be the record holder of such
Common Stock as of such date.
(c) In the case of any share of Series A Preferred Stock that is
converted after any record date with respect to the payment of a dividend on the
Series A Preferred Stock and on or prior to the date on which such dividend is
payable by the Corporation (the "Dividend Due Date") the dividend due on such
Dividend Due Date shall be payable on such Dividend Due Date to the holder of
record of such shares as of such preceding record date notwithstanding such
conversion. Shares of Series A Preferred Stock surrendered for conversion
during the period from the close of business on any record date with respect to
the payment of a dividend on the Series A Preferred Stock next preceding any
Dividend Due Date to the opening of business on such Dividend Due Date shall
(except in the case of shares of Series A Preferred Stock which have been called
for redemption on a redemption date within such period) be accompanied by
payment in next-day funds or other funds acceptable to the Corporation of an
amount equal to the dividend payable on such Dividend Due Date on the shares of
Series A Preferred Stock being surrendered for conversion. The dividend with
respect to a share of Series A Preferred Stock called for redemption on a
redemption date during the period from the close of business on any record date
with respect to the payment of a dividend on the Series A Preferred Stock next
preceding any Dividend Due Date to the opening of business on such Dividend Due
Date shall be payable on such
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Dividend Due Date to the holder of record of such share of such dividend record
date notwithstanding the conversion of such share of Series A Preferred Stock
after such record date and prior to such Dividend due Date, and the holder
converting such share of Series A Preferred Stock need not include a payment of
such dividend amount upon surrender of such share of Series A Preferred Stock
for conversion. Except as provided in this paragraph, no payment or adjustment
shall be made upon any conversion on account of any dividends accrued on shares
of Series A Preferred Stock surrendered for conversion or on account of any
dividends on the shares of Common Stock issued upon conversion.
(d) No fractional shares of Common Stock shall be issued upon
conversion of any shares of Series A Preferred Stock. If more than one share of
Series A Preferred Stock is surrendered at one time by the same holder, the
number of full shares of Common Stock issuable upon conversion thereof shall be
computed on the basis of the aggregate number of shares so surrendered. If the
conversion of any shares of Series A Preferred Stock results in a fractional
share of Common Stock, the Corporation shall pay cash in lieu thereof in an
amount equal to such fraction multiplied by the closing price, as defined in
subsection (vi) of Paragraph 5(e) below, on the date on which the shares of
Series A Preferred Stock were duly surrendered for conversion, or if such date
is not a trading date, on the next succeeding trading date.
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(e) The Conversion Price shall be adjusted from time to time as
follows:
(i) In case the Corporation shall pay or make a dividend or
other distribution on shares of Common Stock in Common Stock, the Conversion
Price in effect at the opening of business on the date following the date fixed
for the determination of shareholders entitled to receive such dividend or other
distribution shall be reduced by multiplying such Conversion Price by a fraction
of which the numerator shall be the number of shares of Common Stock outstanding
at the close of business on the date fixed for such determination and the
denominator shall be the sum of such number of shares and the total number of
shares constituting such dividend or other distribution, such reduction to
become effective immediately after the opening of business on the date following
the date fixed for such determination. For purposes of this subsection, the
number of shares of Common Stock at any time outstanding shall include shares
issuable in respect of scrip certificates issued in lieu of fractions of shares
of Common Stock.
(ii) In case the Corporation shall issue rights or warrants to
all holders of its Common Stock entitling them to subscribe for or purchase
shares of Common Stock at a price per share less than the current market price
per share (determined as provided in subsection (vi) below) of the Common Stock
on the date fixed for the determination of shareholders entitled to receive such
rights or warrants (other than pursuant
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to a dividend reinvestment plan), the Conversion Price in effect at the opening
of business on the day following the date fixed for such determination shall be
reduced by multiplying such Conversion Price by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding at the close
of business on the date fixed for such determination plus the number of shares
of Common Stock which the aggregate of the offering price of the total number of
shares of Common Stock so offered for subscription or purchase would purchase at
such current market price and the denominator shall be the number of shares of
Common Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock so offered for
subscription or purchase, such reduction to become effective immediately after
the opening of business on the day following the date fixed for such
determination. For the purposes of this subsection (ii), the number of shares of
Common Stock at anytime outstanding shall include shares issuable in respect of
scrip certificates issued in lieu of fractions of shares of Common Stock.
(iii) In case outstanding shares of Common Stock shall be
subdivided into a greater number of shares of Common Stock, the Conversion Price
in effect at the opening of business on the day following the day upon which
such subdivision becomes effective shall be proportionately reduced, and,
conversely, in case outstanding shares of Common Stock shall be combined into a
smaller number of shares of Common Stock, the
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Conversion Price in effect at the opening of business on the day following the
day upon which such combination becomes effective shall be proportionately
increased, such reduction or increase, as the case may be, to become effective
immediately after the opening of business on the day following the day upon
which such subdivision or combination becomes effective.
(iv) In case the Corporation shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences of its indebtedness or
assets (including securities, but excluding any rights or warrants referred to
in subsection (ii) above, any dividend or distribution paid in cash out of the
retained earnings of the Corporation and any dividend or distribution referred
to in subsection (i) above), the Conversion Price shall be adjusted so that the
same shall equal the price determined by multiplying the Conversion Price in
effect immediately prior to the close of business on the date fixed for the
determination of shareholders entitled to receive such distribution by a
fraction of which the numerator shall be the current market price per share
(determined as provided in subsection (vi) below) of the Common Stock on the
date fixed for such determination less the then fair market value (as determined
by the Board of Directors, whose determination shall be conclusive and shall be
described in a statement filed with the Transfer Agent) of the portion of the
evidences of indebtedness or assets so distributed applicable to one share of
Common Stock and the denominator shall be such current market price per share
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of the Common Stock, such adjustment to become effective immediately prior to
the opening of business on the day following the date fixed for the
determination of shareholders entitled to receive such distribution.
(v) The reclassification of Common Stock into securities other
than Common Stock (other than any reclassification upon a consolidation or
merger to which Paragraph 5(g) below applies) shall be deemed to involve (A) a
distribution of such securities other than Common Stock to all holders of Common
Stock (and the effective date of such reclassification shall be deemed to be
"the date fixed for the determination of shareholders entitled to receive such
distribution" within the meaning of subsection (iv) above), and (B) a
subdivision or combination, as the case may be, of the number of shares of
Common Stock outstanding immediately prior to such reclassification into the
number of shares of Common Stock outstanding immediately thereafter (and the
effective date of such reclassification shall be deemed to be "the day upon
which such subdivision or combination becomes effective" within the meaning of
subsection (iii) above).
(vi) For the purpose of any computation under subsections
(ii) and (iv) above, the current market price per share of Common Stock on any
day shall be deemed to be the average of the daily closing prices for the ten
consecutive trading days selected by the Board of Directors commencing not more
than 20 trading days before and ending not later than the
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day in question. The closing price for each day shall be the reported last sale
price regular way or, in case no such reported sale takes place on such day, the
average of the reported closing bid and asked prices regular way, in either case
on the New York Stock Exchange or, if the Common Stock is not listed or admitted
to trading on such Exchange, on the principal national securities exchange on
which the Common Stock is listed or admitted to trading or, if not listed or
admitted to trading on any national securities exchange, on the National
Association of Securities Dealers Automated Quotation National Market System or,
if the Common Stock is not listed or admitted to trading on any national
securities exchange or quoted on such National Market System, the average of the
closing bid and asked prices in the over-the-counter market as furnished by any
New York Stock Exchange member firm selected from time to time by the Board of
Directors for that purpose.
(vii) No adjustment in the Conversion Price for the Series A
Preferred Shares shall be required unless such adjustment would require and
increase or decrease of at least 1% in such price; provided, however, that any
adjustments which by reason of this paragraph (vii) are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
All calculations under this Section shall be made to the nearest cent or to the
nearest one-hundredth of a share, as the case may be.
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(f) Whenever the Conversion Price shall be adjusted as herein
provided (i) the Corporation shall forthwith make available at the office of the
Transfer Agent for the Series A Preferred Stock a statement describing in
reasonable detail the adjustment, the facts requiring such adjustment and the
method of calculation used; and (ii) the Corporation shall cause to be mailed by
first class mail, postage prepaid, as soon as practicable to each holder of
record of shares of Series A Preferred Stock a notice stating that the
Conversion Price has been adjusted and setting forth the adjusted Conversion
Price.
(g) In the case of any consolidation or merger to which the
Corporation is a party and as a result of which holders of Common Stock shall be
entitled to receive securities, cash or other property with respect to or in
exchange for such Common Stock, or in case of any sale or conveyance to another
corporation of the property of the Corporation as an entirety or substantially
as an entirety, or in case of any reclassification or change in 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 of the Common Stock), there will be no adjustment of the
Conversion Price but the holder of each share of Series A Preferred Stock then
outstanding will have the right thereafter to convert such share into the kind
and amount of securities, cash or other property which such holder would have
owned or have been entitled to receive immediately after such consolidation or
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merger, sale or conveyance or reclassification or change had such share been
converted immediately prior to the effective date of such consolidation or
merger, sale or conveyance or reclassification or change. The adjustments
described in this paragraph shall be subject to further adjustments as
appropriate paragraph shall be subject to further adjustments as appropriate
that shall be as nearly equivalent as may be practicable to the relevant
adjustments provided for in Paragraph 5(e) and this paragraph 5(g). If, in the
case of any such consolidation, merger, sale or conveyance, the stock or other
securities and property receivable thereupon by a holder of shares of Common
Stock includes shares of stock, securities or other property or assets
(including cash) of an entity other than the successor or acquiring entity, as
the case may be, in such consolidation, merger, sale or conveyance, then the
Corporation shall enter into an agreement with such other entity for the benefit
of the holders of Series A Preferred Stock that shall contain such provisions
to protect the interests of such holders as the Board of Directors shall
reasonably consider necessary by reason of the foregoing. The provisions of this
Paragraph 5(g) shall similarly apply to successive consolidations, mergers,
sales, exchanges, reclassifications or changes.
(h) The Corporation shall pay any taxes that may be payable in
respect of the issuance of shares of Common Stock upon conversion of shares of
Series A Preferred Stock, but the Corporation shall not be required to pay any
taxes which may be payable in respect of any transfer involved in the issuance
of
-22-
shares of Common Stock in any name other than that in which the shares of Series
A Preferred Stock so converted are registered, and the Corporation shall not be
required to issue or deliver any such shares unless and until the person
requesting such issuance shall have paid to the Corporation the amount of any
such taxes, or shall have established to the satisfaction of the Corporation
that such taxes have been paid.
(i) The Corporation may make such reductions in the Conversion
Price, in addition to those required by subsections (i) through (iv) of
Paragraph 5(e) above, as it considers to be advisable in order that any event
treated for federal income tax purposes as a dividend of stock or stock rights
shall not be taxable to the recipients.
(j) The Corporation shall at all times reserve and keep
available out of its authorized but unissued Common Stock the full number of
shares of Common Stock issuable upon the conversion of all shares of Series A
Preferred Stock then outstanding.
(k) In the event that:
(i) the Corporation shall declare a dividend or any other
distribution of its Common Stock, payable otherwise than in cash out
of retained earnings; or
(ii) the Corporation shall authorize the granting to the
holders of its Common Stock of rights to subscribe for or purchase any
shares of capital stock of any class or of any other rights; or
-23-
(iii) the Corporation shall propose to effect any consolidation
of the Corporation with or merger of the Corporation with or into any
other corporation or a sale of the assets of the Corporation
substantially as an entirety which would result in an adjustment under
Paragraph 5(g);
the Corporation shall cause to be mailed to the holders of record of Series A
Preferred Stock at least 20 days prior to the applicable date hereinafter
specified a notice stating (x) the date on which a record is to be taken for the
purpose of such dividend, distribution or rights or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution or rights are to be determined or (y) the date on
which such consolidation, merger or sale is expected to become effective, and
the date as of which it is expected that holders of Common Stock of record shall
be entitled to exchange their shares of Common Stock for securities or other
property deliverable upon such consolidation, merger or sale. Failure to give
such notice, or any defect therein, shall not affect the legality or validity of
such dividend, distribution, consolidation, merger or sale.
(6) Voting Rights. Other than as required by applicable law, the Series A
-------------
Preferred Stock shall not have any voting powers either general or special,
except that:
(a) Unless the vote or consent of the holders of a greater
number of shares shall then be required by
-24-
law, the consent of the holders of at least two-thirds of all of the
shares of the Series A Preferred Stock at the time outstanding, given in
person or by proxy, either in writing or by a vote at a meeting called
for the purpose at which the holders of shares of Series A Preferred
Stock shall vote together as a separate class, shall be necessary to (i)
authorize, create or issue, or increase the authorized or issued amount
of, any class or series of stock ranking prior to the Series A Preferred
Stock with respect to payment of dividends or the distribution of assets
upon liquidation, dissolution or winding up, (ii) authorize, create or
issue, or increase the authorized or issued amount of, any class or
series of stock (including any class or series of Preferred Stock) which
ranks on a parity with the Series A Preferred Stock as to dividends and
upon liquidation, dissolution or winding up ("Parity Stock") unless the
Articles of Incorporation creating or authorizing such class or series
provide that if in any case the stated dividends or amounts payable upon
liquidation, dissolution or winding up are not paid in full on the Series
A Preferred Stock and all outstanding shares of Parity Stock, the shares
of all Parity Stock shall share ratably in the payment of dividends,
including accumulations (if any) in accordance with the sums
-25-
which would be payable on all Parity Stock if all dividends in respect of
all shares of Parity Stock were paid in full, and on any distribution of
assets upon liquidation, dissolution or winding up ratably in accordance
with the sums which would be payable in respect of all shares of Parity
Stock if all sums payable were discharged in full, or (iii) amend, alter
or repeal the provisions of the Articles of Incorporation, whether by
merger, consolidation or otherwise, so as to materially and adversely
affect any right, preference, privilege or voting power of such shares of
Series A Preferred Stock or the holders thereof; provided, however, that
any increase in the amount of the authorized Preferred Stock or any
outstanding series of Preferred Stock or any other capital stock of the
Corporation, or the creation and issuance of other series of Preferred
Stock including Series A Preferred Stock, or of any other capital stock
of the Corporation, in each case ranking on a parity with or junior to
the Series A Preferred Stock with respect to the payment of dividends and
the distribution of assets upon liquidation, dissolution or winding up
shall not be deemed to materially and adversely affect such rights,
preferences, privileges or voting powers.
-26-
(b) Whenever, at any time or times, dividends payable on the shares of
Series A Preferred Stock shall be in arrears in an amount equal to at least six
full quarterly dividends, whether or not consecutive, on shares of the Series A
Preferred Stock at the time outstanding, the holders of the outstanding shares
of Series A Preferred Stock shall have the exclusive right, voting separately as
a class together with all other series of cumulative Preferred Stock upon which
like voting rights have been conferred and are exercisable, to elect two
directors of the Corporation at the Corporation's next annual meeting of
shareholders and at each subsequent annual meeting of shareholders. At elections
for such directors, each holder of Series A Preferred Stock shall be entitled to
one vote for each share held. Upon the vesting of such right of the holders of
Series A Preferred Stock, the maximum authorized number of members of the Board
of Directors shall automatically be increased by two. The rights of the holders
of the Series A Preferred Stock, voting separately as a class (either alone or
together with the holders of shares of all other series of cumulative Preferred
Stock upon which like voting rights have been conferred and are exercisable) to
elect members of the Board of Directors of the Corporation as aforesaid shall
continue until such time.
-27-
as all dividends accumulated on the Series A Preferred Stock shall
have been paid in full, at which time such right shall terminate,
except as herein or by law expressly provided, subject to revesting
in the event of each and every subsequent default of the character
above mentioned.
(c) Each director elected pursuant to Paragraph (b) shall
continue to serve as such director for the full term for which he
shall have been elected, notwithstanding that prior to the end of
such term all dividends accumulated on the Series A Preferred Stock
shall have been paid in full. If the office of any director elected
by the holders of Series A Preferred Stock voting as a class becomes
vacant by reason of death, resignation, retirement, disqualification,
removal from office, or otherwise, the remaining director elected by
the holders of the Series A Preferred Stock voting as a class may
choose a successor who shall hold office for the unexpired term in
respect of which such vacancy occurred. Whenever the term of office
of the directors elected by and the special voting powers vested in
the holders of Series A Preferred Stock as provided in this Section
shall have expired, the number of directors shall be such number as
may be provided for in the Articles of Incorporation
-28-
or Bylaws irrespective of any increase made pursuant to the
provisions of this section.
(7) Reacquired Shares. Shares of Series A Preferred Stock converted,
-----------------
redeemed, or otherwise purchased or acquired by the Corporation shall be
restored to the status of authorized but unissued shares of Preferred Stock
without designation as to series.
(8) No Sinking Fund. Shares of Series A Preferred Stock are not subject
---------------
to the operation of a sinking fund.
ARTICLE V
The number of directors of the Corporation may be fixed by the Bylaws, but
shall not be less than three. The Board of Directors shall be divided into
three classes each class to be as nearly equal in number as possible. At each
annual meeting of the stockholders, the successors of the directors of the class
whose terms expire in that year shall be elected to hold office for the term of
three years, so that the term of office of one class of directors shall expire
each year. Directors may be removed from office, prior to the expiration of
their term, only for cause and only by the affirmative vote of the holders of
not less than a majority of the shares of stock outstanding and entitled to vote
for the election of directors. Notwithstanding any other provision of these
Articles of Incorporation or the Bylaws of the Corporation (and in addition to
any other vote that may be required by law, these Articles of Incorporation or
the
-29-
Bylaws of the Corporation), the affirmative vote of the holders of not less than
two-thirds of all the shares of stock outstanding and entitled to vote thereon
shall be required to amend, alter, change or repeal this Article V of these
Articles of Incorporation.
ARTICLE VI
In addition to the general powers granted corporations under the laws of
the State of North Carolina, the Corporation shall have full power and authority
to do the following:
(d) To acquire, by purchase or otherwise, the goodwill, business,
property rights, franchises and assets of every kind, with or without
undertaking either wholly or in part the liabilities, of any person, firm,
association or corporation; and to acquire any property or business as a going
concern or otherwise (i) by purchase of the assets thereof wholly or in part,
(ii) by acquisition of the shares of any part thereof, or (iii) in any other
manner, and to pay for the same in cash or in shares or bonds or other evidences
of indebtedness of the Corporation, or otherwise; to hold, maintain and operate,
or in any manner dispose of, the whole or any part of the goodwill, business,
rights and property so acquired, and to conduct in any lawful manner the whole
or any part of any business so acquired; and to exercise all the powers
necessary or convenient in and about the management of such business.
-30-
(e) To subscribe or cause to be subscribed for, and to take, purchase and
otherwise acquire, own, hold, use, sell, assign, transfer, exchange, distribute
and otherwise dispose of, the whole or any part of the shares of the capital
stock, bonds, coupons, mortgage, deeds of trust, debentures, securities,
obligations, evidences of indebtedness, notes, goodwill, rights, assets and
property of any and every kind, or any part thereof, of any other corporation or
corporations, association or associations, firm or firms, or person or persons,
together with shares, rights, units or interest in, or in respect of, any trust
estate, now or hereafter existing, and whether created by the laws of the State
of North Carolina or any other state, territory or country; and to operate,
manage and control such properties, or any of them either in the name of the
Corporation, and while the owners of any of said shares of capital stock to
exercise all the rights, powers and privileges of ownership of every kind and
description, including the right to vote thereon, with power to designate some
person or persons for that purpose from time to time, and to the same extent as
natural persons might or could do.
(f) To promote or aid in any manner, financially or otherwise, any
person, firm, corporation or association of which any shares of stock, bonds,
notes, debentures or other securities or evidences of indebtedness are held
directly or indirectly by the Corporation, and for this purpose to guarantee the
contracts,
-31-
dividends, shares, bonds, debentures, notes and other obligations of such other
persons, firms, corporations or associations; and to do any other act or things
designed to protect, preserve, improve or enhance the value of such shares,
bonds, notes, debentures or other securities or evidences of indebtedness.
(g) To acquire by purchase, subscription, exchange, or in any other
lawful manner, and to hold, receive, use, mortgage, pledge, sell, assign,
transfer, exchange, dispose of, and otherwise deal in and with securities (which
term, for the purpose of this Article VI, includes, without limitation of the
generality thereof, shares of stock, other shares, bonds, debentures, notes,
mortgages, or other obligations, and certificates, receipts, warrants, or other
instruments representing rights or options to receive, purchase or subscribe for
any of the same, or representing any other rights or interests therein or in any
property or assets) created or issued by any persons, firms, associations,
trusts, partnerships, corporations, joint ventures, syndicates, or governments
or subdivisions thereof; to pay for securities (as defined in this Article VI)
(i) in cash, (ii) by exchange of shares of stock, bonds or other evidences of
indebtedness of the Corporation for such securities acquired, (iii) in cash and
by such exchange of shares of stock, bonds or evidences of indebtedness, or (iv)
in any other lawful manner; and to exercise, as owner or holder of any such
securities as herein defined, any and all rights, powers and privileges in
respect thereof.
-32-
ARTICLE VII
No holder of: (a) any shares of stock of any class of the Corporation,
common or preferred, or (b) any options, rights or warrants to purchase any
stock, or (c) any shares or obligations convertible into shares of any class
shall be entitled as of right as such holder to purchase or to subscribe for any
unissued shares of any class nor any increased shares to be issued by reason of
any increase in the authorized capital stock of the Corporation, or any bonds,
certificates of indebtedness, debentures, or other securities convertible into
shares of stock of the Corporation or carrying any right to purchase shares of
stock of any class, whether now or hereafter authorized; and no such holder
shall have any preemptive or preferential right to purchase or to subscribe for
any unissued, additional or increased shares or any such bonds, certificates of
indebtedness, debentures or other securities; but any such unissued, additional
or increased shares of stock, and any such bonds, certificates of indebtedness,
debentures or other securities convertible into shares of stock or carrying any
right to purchase shares may be issued, sold, exchanged or disposed of from time
to time by authority of the Board of Directors of the Corporation to such
persons, firms, or corporations and for such consideration and upon such terms
as the Board of Directors in the exercise of its discretion shall from time to
time determine and deem advisable.
-33-
ARTICLE VIII
The Board of Directors of the Corporation shall have power by vote of a
majority of the directors then holding office and without the assent or vote of
the shareholders to adopt, make, alter, amend and rescind the Bylaws of the
Corporation.
ARTICLE IX
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 damage for breach of his duty as a director. Any
repeal or modification of this Article IX 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.
-34-
STATE OF [SEAL OF NORTH CAROLINA APPEARS HERE]
NORTH Department of The
CAROLINA Secretary of State
- --------------------------------------------------------------------------------
To all whom these presents shall come, Greetings:
I, ELAINE F. MARSHALL, Secretary of State of the State of
North Carolina, do hereby certify the following and hereto
attached to be a true copy of
ARTICLES OF AMENDMENT
OF
SOUTHERN NATIONAL CORPORATION
the original of which was filed in this office on the 14th day of
January, 1997.
IN WITNESS WHEREOF, I have hereunto set
my hand and affixed my official seal at
the City of Raleigh, this 14th day of
January, 1997.
[SEAL OF THE STATE
OF NORTH CAROLINA
APPEARS HERE] /s/ Elaine F. Marshall
Secretary of State
- --------------------------------------------------------------------------------
ARTICLES OF AMENDMENT
WITH RESPECT TO THE SERIES B JUNIOR PARTICIPANT
PREFERRED STOCK OF SOUTHERN NATIONAL CORPORATION
(Pursuant to Sections 55-6-02 and 55-10-06
of the North Carolina Business Corporations Act)
Southern National Corporation, a North Carolina corporation (the
"Corporation"), hereby submits these Articles of Amendment for the purpose of
amending its Articles of Incorporation to determine the preferences,
limitations, and relative rights (within the limits set forth in Section 55-6-01
of the North Carolina Business Corporation Act) of a new series of Preferred
Stock, par value $5 per share:
(1) The name of the Corporation is Southern National Corporation.
(2) Pursuant to authority granted by Article IV of the Amended and
Restated Articles of Incorporation of the Corporation and in accordance with the
provisions of Section 55-6-02 of the North Carolina Business Corporation Act,
the Board of Directors of the Corporation duly adopted on December 17, 1996, the
following amendment to the Articles of Incorporation of the Corporation:
1. Designation and Amount. The shares of such series shall be designated as
----------------------
"Series B Junior Participating Preferred Stock" and the number of shares
constituting such series initially shall be 2,000,000. Such number of
shares may be increased or decreased by the Board of Directors; provided,
--------
that no decrease shall reduce the number of shares of Series B Junior
Participating Preferred Stock to a number less than the number of shares
then outstanding plus the number of shares reserved for issuance upon the
exercise of outstanding options, rights or warrants or upon the
conversion of any outstanding securities issued by the Corporation
convertible into Series B Junior Participating Preferred Stock.
2. Dividends and Distributions.
---------------------------
(a) Subject to the prior and superior rights of the holders of any
shares of any series of Preferred Stock ranking prior and superior to the shares
of Series B Junior Participating Preferred Stock with
-2-
respect to dividends, the holders of shares of Series B Junior Participating
Preferred Stock, in preference to the holders of Common Stock, par value $5
per share, of the Corporation (the "Common Stock") and of any other junior
stock, shall be entitled to receive, when, as and if declared by the Board of
Directors out of funds legally available for the purpose, quarterly dividends
payable in cash on the first day of February, May, August and November in each
year (each such date being referred to herein as a "Quarterly Dividend Payment
Date"), commencing on the first Quarterly Dividend Payment Date after the first
issuance of a share or fraction of a share of Series B Junior Participating
Preferred Stock, in an amount per share (rounded to the nearest cent) equal to
the greater of (a) $1.00 or (b) subject to the provision for adjustment
hereinafter set forth, 100 times the aggregate per share amount of all cash
dividends, and 100 times the aggregate per share amount (payable in kind) of all
non-cash dividends or other distributions, other than a dividend payable in
shares of Common Stock or a subdivision of the outstanding shares of Common
Stock (by reclassification or otherwise), declared on the Common Stock since the
immediately preceding Quarterly Dividend Payment Date, or , with respect to the
first Quarterly Dividend Payment Date, since the first issuance of any share or
fraction of a share of Series B Junior Participating Preferred Stock. In the
event the Corporation shall on or at any time after December 17, 1996 (the
"Rights Declaration Date") (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine or consolidate the outstanding shares of Common Stock into a smaller
number of shares, then in each such case the amount to which holders of shares
of Series B Junior Participating Preferred Stock were entitled immediately prior
to such event under clause (b) of the preceding sentence shall be adjusted by
multiplying such amount by a fraction the numerator of which is the number of
shares of Common Stock outstanding immediately after such event and the
denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(b) The Corporation shall declare a dividend or distribution on the
Series B Junior Participating Preferred Stock as provided in paragraph (a) above
immediately after it declares a dividend or distribution on the Common Stock
(other than a dividend payable in shares of Common Stock); provided that,
subject to the requirements of applicable law and the Articles of
-3-
Incorporation, in the event no dividend or distribution shall have been declared
on the Common Stock during the period between any Quarterly Dividend Payment
Date and the next subsequent Quarterly Dividend Payment Date, a dividend of
$1.00 per share on the Series B Junior Participating Preferred Stock shall
nevertheless be payable on such subsequent Quarterly Dividend Payment Date.
(c) Dividends shall begin to accrue and be cumulative on outstanding
shares of Series B Junior Participating Preferred Stock from the Quarterly
Dividend Payment Date next preceding the date of issue of such shares of Series
B Junior Participating Preferred Stock, unless the date of issue of such shares
is prior to the record date for the first Quarterly Dividend Payment Date, in
which case dividends on such shares shall begin to accrue from the date of issue
of such shares, or unless the date of issue is a Quarterly Dividend Payment Date
or is a date after the record date for the determination of holders of shares of
Series B Junior Participating Preferred Stock entitled to receive a quarterly
dividend and before such Quarterly Dividend Payment Date, in either of which
events such dividends shall begin to accrue and be cumulative from such
Quarterly Dividend Payment Date. Accrued but unpaid dividends shall not bear
interest. Dividends paid on the shares of Series B Junior Participating
Preferred Stock in an amount less than the total amount of such dividends at the
time accrued and payable on such shares shall be allocated pro rata on a share-
by-share basis among all such shares at the time outstanding. The Board of
Directors may fix a record date for the determination of holders of shares of
Series B Junior Participating Preferred Stock entitled to receive payment of a
dividend or distribution declared thereon, which record date shall be no more
than 60 days prior to the date fixed for the payment thereof.
3. Voting Rights. The holders of shares of Series B Junior Participating
-------------
Preferred Stock shall have the following voting rights:
(a) Subject to the provision for adjustment hereinafter set forth,
each share of Series B Junior Participating Preferred Stock shall entitle the
holder thereof to 100 votes on all matters submitted to a vote of the
shareholders of the Corporation. In the event the Corporation shall at any time
on or after the Rights Declaration Date (i) declare any dividend on Common
-4-
Stock payable in shares of Common Stock, (ii) subdivide the outstanding Common
Stock, or (iii) combine or consolidate the outstanding Common Stock into a
smaller number of shares, then in each such case the number of votes per share
to which holders of shares of Series B Junior Participating Preferred Stock were
entitled immediately prior to such event shall be adjusted by multiplying such
number by a fraction the numerator of which is the number of shares of Common
Stock outstanding immediately after such event and the denominator of which is
the number of shares of Common Stock that were outstanding immediately prior to
such event.
(b) Except as otherwise provided herein, in any other amendment to
the Articles of Incorporation of the Corporation or by law, the holders of
shares of Series B Junior Participating Preferred Stock and the holders of
shares of Common Stock shall vote together as one group on all matters submitted
to a vote of shareholders of the Corporation.
(c) Except as set forth herein, holders of Series B Junior
Participating Preferred Stock shall have no special voting rights and their
consent shall not be required (except to the extent they are entitled to vote
with holders of Common Stock as set forth herein) for taking any corporate
action.
4. Certain Restrictions.
--------------------
(a) Whenever quarterly dividends or other dividends or distributions
payable on the Series B Junior Participating Preferred Stock as provided in
Section 2 are in arrears, thereafter and until all accrued and unpaid dividends
and distributions, whether or not declared, on shares of Series B Junior
Participating Preferred Stock outstanding shall have been paid in full, the
Corporation shall not:
(i) declare or pay dividends on, redeem or purchase or
otherwise acquire for consideration, or make any other distributions on any
shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series B Junior Participating Preferred
Stock:
(ii) declare or pay dividends on, redeem or purchase or
otherwise acquire for consideration, or make any other distributions on
- 5 -
any shares of stock ranking on a parity (either as to dividends or
upon liquidation, dissolution or winding up) with the Series B Junior
Participating Preferred Stock, provided that there may be declared and
paid ratably dividends on the Series B Junior Participating Preferred
Stock and all such parity stock on which dividends are payable or in
arrears in proportion to the total amounts to which the holders of all
such shares are then entitled; and provided further that the
Corporation may at any time redeem or purchase or otherwise acquire
shares of any such parity stock in exchange for shares of any stock of
the Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series B Junior
Participating Preferred Stock;
(iii) purchase or otherwise acquire for consideration any
shares of Series B Junior Participating Preferred Stock, or redeem or
purchase or otherwise acquire any shares of stock ranking on a parity
with the Series B Junior Participating Preferred Stock, except in
accordance with a purchase offer made in writing or by publication (as
determined by the Board of Directors) to all holders of such shares
upon such terms as the Board of Directors, after consideration of the
respective annual dividend rates and other relative rights and
preferences of the respective series and classes, shall determine in
good faith will result in fair and equitable treatment among the
respective series or classes.
(b) The Corporation shall not permit any subsidiary of the
Corporation (for the account of such subsidiary) to purchase or otherwise
acquire for consideration any shares of stock of the Corporation unless the
Corporation could, under paragraph (a) of this Section 4, purchase or otherwise
acquire such shares at such time and in such manner.
(c) No dividend shall be declared and paid, or set apart for
payment on, any share of the Series B Junior Participating Preferred Stock or
any share of any other series of Preferred Stock or any share of any class of
stock, or series thereof, ranking on a parity with this Series as to dividends,
for any dividend period unless at the same time a like proportionate dividend
for the same dividend period, ratably in
- 6 -
proportion to the respective dividends applicable thereto, shall be declared and
paid, or set apart for payment on, all shares of this Series and all shares of
all other series of Preferred Stock and all shares of any class, or series
thereof, ranking on a parity with this Series as to dividends, then issued and
outstanding and entitled to receive dividends.
5. Reacquired Shares. Any shares of Series B Junior Participating
-----------------
Preferred Stock purchased or otherwise acquired by the Corporation in any manner
whatsoever shall be retired and cancelled promptly after the acquisition
thereof. All such shares shall upon their cancellation become authorized but
unissued shares of Preferred Stock and may be reissued as part of a new series
of Preferred Stock, subject to the conditions and restrictions on issuance set
forth herein, in the Articles of Incorporation of the Corporation (including
Articles of Amendment duly adopted in accordance with the North Carolina
Business Corporation Act), creating a series of Preferred Stock or any similar
stock, or as otherwise required by law.
6. Liquidation, Dissolution or Winding Up.
--------------------------------------
(a) Upon any liquidation (voluntary or otherwise), dissolution or
winding up of the Corporation, no distribution shall be made to the holders of
shares of stock ranking junior (either as to dividends or upon liquidation,
dissolution or winding up) to the Series B Junior Participating Preferred Stock
unless, prior thereto, the holders of shares of Series B Junior Participating
Preferred Stock shall have received $100 per share, plus an amount equal to
accrued and unpaid dividends and distributions thereon, whether or not declared,
to the date of such payment (the "Series B Liquidation Preference"). Following
the payment of the full amount of the Series B Liquidation Preference, no
additional distributions shall be made to the holders of shares of Series B
Junior Participating Preferred Stock unless, prior thereto, the holders of
shares of Common Stock shall have received an amount per share (the "Common
Adjustment") equal to the quotient obtained by dividing (i) the Series B
Liquidation Preference by (ii) 100 (as appropriately adjusted as set forth in
subparagraph (c) below to reflect such events as stock splits, stock dividends
and recapitalizations with respect to the Common Stock) (such number in clause
(ii), the "Adjustment Number"). Following the payment of the full amount of the
Series B Liquidation Preference and the Common Adjustment in respect to all
- 7 -
outstanding shares of Series B Junior Participating Preferred Stock and Common
Stock, respectively, holders of Series B Junior Participating Preferred Stock
and holders of shares of Common Stock shall receive their ratable and
proportionate share of the remaining assets to be distributed in the ratio of
the Adjustment Number to one (1) respect to such Preferred Stock and Common
Stock, on a per share basis, respectively.
(b) In the event, however, that there are not sufficient assets
available to permit payment in full of the Series B Liquidation Preference and
the liquidation preferences of all other series of Preferred Stock, if any,
which rank on a parity with the Series B Junior Participating Preferred Stock,
then such remaining assets shall be distributed ratably to the holders of such
parity shares in proportion to their respective liquidation preferences. In the
event that there are not sufficient assets available to permit payment in full
of the Common Adjustment, then such remaining assets shall be distributed
ratably to the holders of Common Stock.
(c) In the event the Corporation shall at any time on or after the
Rights Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine the outstanding Common Stock into a smaller number of shares, then in
each such case the Adjustment Number in effect immediately prior to such event
shall be adjusted by multiplying such Adjustment Number by a fraction the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock that were outstanding immediately prior to such event.
(d) Neither the sale, lease or conveyance of all or substantially
all of the property or business of the Corporation, nor the merger,
consolidation or statutory share exchange of the Corporation into or with any
other corporation or the merger, consolidation or statutory share exchange of
any other corporation into or with the Corporation, shall be deemed to be a
liquidation, dissolution or winding-up, voluntary or involuntary, for the
purposes of this Paragraph 6.
7. Statutory Share Exchange, Merger Consolidation, etc. In case the
---------------------------------------------------
Corporation shall enter into any statutory share exchange, merger,
consolidation, combination or other transaction in which
- 8 -
the shares of Common Stock are exchanged for or changed into other stock
securities, cash and/or any other property, then in any such case the shares of
Series B Junior Participating Preferred Stock shall at the same time be
similarly exchanged or changed in an amount per share (subject to the provision
for adjustment hereinafter set forth) equal to 100 times the aggregate amount of
stock, securities, cash and/or any other property (payable in kind), as the case
may be, into which or for which each share of Common Stock is changed or
exchanged. In the event the Corporation shall at any time on or after the
Rights Declaration Date (i) declare any dividend on Common Stock payable in
shares of Common Stock, (ii) subdivide the outstanding Common Stock, or (iii)
combine or consolidate the outstanding Common Stock into a smaller number of
shares, then in each such case the amount set forth in the preceding sentence
with respect to the exchange or change of shares of Series B Junior
Participating Preferred Stock shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately prior to such
event.
8. No Redemption. The shares of Series A Junior Participating
-------------
Preferred Stock shall not be redeemable.
9. Ranking. The Series B Junior Participating Preferred Stock shall
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rank junior to all other series of the Corporation's Preferred Stock as to the
payment of dividends and the distribution of assets, unless the terms of any
such series shall provide otherwise.
10. Amendment. The Articles of Incorporation of the Corporation shall
---------
not be further amended in any manner which would materially alter or change the
powers, preferences or special rights of the Series B Junior Participating
Preferred Stock so as to affect them adversely, except in accordance with the
provisions of Section 55-10-04 of the North Carolina Business Corporation Act,
or as otherwise permitted by law.
11. Fractional Shares. Series B Junior Participating Preferred Stock
-----------------
may be issued in fractions of a share (which shall be integral multiples of one
one-hundredth of a share of Series B Junior Participating Preferred Stock),
which shall entitle the holder, in proportion to such holder's fractional
shares, to exercise voting rights, receive dividends,
- 9 -
participate in distributions and to have the benefit of all other rights of
holders of Series B Junior Participating Preferred Stock.
* * *
This 10th day of January 1997.
SOUTHERN NATIONAL CORPORATION
By: /s/ Kelly S. King
--------------------------
Name: Kelly S. King
Title: President